2023 Annual Report

Notes to the Consolidated Financial Statements

Consolidated Financial Statements

N otes to t h e Consolidated Financial Statements Fo r t h e y ea r ended D ecem b e r 31, 2023

For the year ended December 31, 2023

1. Cas h and cas h e q uivalents Cas h and cas h e q uivalents as at D ecem b e r 31, 2023 we r e comp r ised as follows : D ec 31, 2023

Dec 31, 2022

Cash

$ 29,777,724 $ 7,443,999 15,489,057 $ 61,015,863 $ 22,933,056 31,238,139

Cash equivalents

Cash equivalents are comprised of a pooled mortgage fund which has generated returns at an interest rate of 3.54% (3.10 % for 2022) and a pooled money market fund which has generated returns at an interest rate of 5.06% (n/a for 2022) 2. P o r tfolio I nvestments Portfolio investments include Canadian bank notes, Guaranteed Investment Certificates and BC Credit Union term deposits with effective interest rates of 1.41% - 6.04%. A portion of the of the bank notes held have interest payments linked to the performance of a set of equities or a financial index without stated or certain interest rates and following the prospective adoption of PS 3450 Financial Instruments have been classified as fair value financial instruments and recorded at their market value as at December 31, 2023. Fair value financial instruments with a face value of $41,000,000 have a market value of $39,686,960 as at December 31, 2023 resulting in a remeasurement loss of $1,313,040. The carrying value of remaining portfolio investments at December 31, 2023 was $197,316,453 ( $253,251,692 for 2022). The market value of portfolio investments at December 31, 2023 was $196,449,377 ( $243,693,597 for 2022). 3. Financial I nst r uments Fai r V alue Fair value estimates are made at the Statement of Financial Position date based on relevant market information and information about the financial instrument. Financial instruments recorded at fair value in the City's Statement of Financial Position are categorized based on the level of judgement required to asses fair value. Hierarchal levels of fair value are defined by PS3450 as follows:  Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);  Inputs other than quoted prices included within Level 1 that are observable for the financial instrument, either directly (i.e., as prices) or indirectly (i.e., derived from prices) (Level 2);  Inputs for the financial instrument that are not based on observable market data (unobservable inputs) (Level 3). The City's portfolio investments measured at fair value as described in Note 2 are classified as Level 2 as at December 31, 2023. R isk M anagement The City is exposed to credit risk, liquidity risk, and interest rate risk from its financial instruments. This note describes the City's objectives, policies, and processes for managing those risks and the methods used to measure them. Further qualitative and quantitative information in respect of these risks is presented below and throughout these financial statements. There have not been any changes from the prior year in the City's exposure to the above risks or the policies, procedures and methods it uses to manage and measure the risks.

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