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3. SINKING FUND 2007 FINANCIAL
STATEMENTS ÉTATS FINANCIERS DE 2007 DU FONDS D’AMORTISSEMENT |
Committee Recommendation
That Council receive the Sinking Fund Financial Statements for 2007.
Recommandation du comité
Que le Conseil prenne connaissance des États financiers de 2007 du fonds
d’amortissement.
1. City Treasurer’s report dated 2 June 2008 (ACS2008-CMR-FIN-0026).
Corporate Services and Economic Development
Committee
Comité des services organisationnels et du développement économique
and Council / et au Conseil
02 June 2008 / le 02 juin 2008
Submitted by/Soumis par : Marian Simulik,
Director Financial Services and City Treasurer
Contact Person/Personne ressource : Gerry Mahoney, Manager, Treasury
Services
Financial
Services/Services financiers
(613)
580-2424 x 21310, gerry.mahoney@ottawa.ca
SUBJECT:
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OBJET :
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That the Corporate
Services and Economic Development Committee and Council receive the Sinking
Fund Financial Statements for 2007.
Que le Comité des services organisationnels et
du développement économique ainsi que le Conseil prennent connaissance des
États financiers de 2007 du fonds d’amortissement.
When the
City issues sinking fund debentures, annual contributions are made to the
Sinking Fund, which together with interest earnings derived from the investment
of these funds accumulate to an amount that will be sufficient to pay the
debentures on maturity.
When the Sinking Fund balance for a debenture issue along with expected future interest earnings is considered to be sufficient to pay the principal amount of the debenture issue at maturity, Council may reduce or discontinue the annual levy contribution in accordance with Section 409(9) and 409(10) of the Municipal Act. When the sinking fund balance for a debenture issue is already more than sufficient to pay the principal amount due on the maturity date, this surplus may be distributed to the general fund in accordance with Section 409 of the Municipal Act.
The accounts for the Sinking Fund have been closed and audited for the year ending 31 December 2007. The value of the Sinking Fund portfolio as at 31 December 2007 was $173.7 million on an amortized cost basis (the market value was $179.1 million). The portfolio exceeds the actuarial requirements of $157.6 million which is the minimum amount required as at 31 December 2007, to accumulate sufficient funds to meet total sinking fund debentures at maturity. Commitments of $285 million are scheduled to mature from 2009 to 2019.
A review of each Sinking Fund account indicates that there will be sufficient funds to meet each debenture commitment at maturity but funds have not accumulated in respect of any by-law to an amount which would support further reducing or discontinuing any levies.
The public consultation process is not applicable.
Sinking
Fund levies are budgeted as debt charges until such time as the contribution is
reduced or discontinued in accordance with Section 409 of the Municipal Act.
Document 1: 2007 Sinking Fund Financial Statements
Document 2: Sinking Fund Earnings by By-law for 2007
Following
consideration by the Corporate Services and Economic Development Committee,
this report will be forwarded to Council for its consideration.