HomeMy WebLinkAboutFSD-028-26Staff Report
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Report To: Council
Date of Meeting: June 22, 2026 Report Number: FSD-028-26
Authored By: Michelle Pick, Accounting Services Manager/Deputy Treasurer
Submitted By: Trevor Pinn, Deputy CAO/Treasurer, Finance and Technology
Reviewed By: Mary-Anne Dempster, CAO
By-law Number: Resolution Number:
File Number:
Report Subject: 2025 Audited Financial Statements
Recommendations:
1.That Report FSD-028-26, and any related delegations or communication items, be
received;
2.That the Financial Statements for the Board of Management for Historic Downtown
Bowmanville Business Improvement Area for the year ending December 31, 2025,
be approved;
3.That the Financial Statements for the Board of Management for the Newcastle
Central Business District Improvement Area for the year ending December 31, 2025,
be approved;
4.That the Financial Statements for the Board of Management for the Orono Central
Business District Improvement Area for the year ending December 31, 2025, be
approved;
5.That the Financial Statements for the Municipality of Clarington Trusts for the year
ending December 31, 2025, be approved;
6.That the Consolidated Financial Statements for the Municipality of Clarington for the
year ending December 31, 2025, be approved;
7.That the Deputy CAO/Treasurer and Accounting Services Manager/Deputy
Treasurer be authorized to sign the required letters to finalize each of the audits;
C-172-26
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Report FSD-028-26
8. That Staff prepare the Annual Financial Report for the year ending December 31,
2025, for publication;
9. That the Mayor be given delegated authority to approve the final version of the
financial statements, as substantially in the form attached to Report FSD-028-26;
and
10. That all interested parties listed in Report FSD-028-26, be advised of Council’s
decision.
Municipality of Clarington Page 3
Report FSD-028-26
Report Overview
To further enhance the transparency and understandability of the Municipality’s financial
1. Background
1.1 Section 294.1 of the Municipal Act, 2001 requires that a municipality, for each fiscal
year, prepare annual financial statements for the municipality in accordance with
generally accepted accounting principles for local governments as recommended, from
time to time, by the Public Sector Accounting Board.
1.2 The statements included in the attachments to this report have been prepared in
accordance with the current Public Sector Accounting Standards (PSAS) that are in
force. Municipality of Clarington Finance and Technology Department staff continue t o
monitor changes to PSAS as they become effective.
1.3 The Consolidated Financial Statements for the Municipality of Clarington include the
organizations, local boards and committees that are controlled by the Municipality and
form the reporting entity under PSAS. These include:
a. Board of Management for the Historic Downtown Bowmanville Business
Improvement Area
b. Board of Management for the Newcastle Central Business District Improvement
Area
c. Board of Management for the Orono Central Business District Improvemen t Area
d. Clarington Public Library Board and Clarington Museums and Archives
e. Newcastle Arena Board
f. Newcastle Community Hall Board
g. Solina Hall Board
Municipality of Clarington Page 4
Report FSD-028-26
h. Tyrone Community Hall Board
i. Clarington Heritage Committee
j. Bowmanville Santa Clause Parade Committee
1.4 Section 295 of the Act requires the Municipality to publish, within 60 days, the audited
financial statements in a newspaper having general circulation within the municipality
and a notice that the statements and notes would be available at no cost to the
taxpayer upon request. The information may also be provided in a manner that the
Treasurer considers appropriate. As in the past, these statements will be made
available on the Municipality’s website, and copies may be obtained from Finance and
Technology Department.
1.5 The Finance and Technology Department drafts an Annual Financial Report, which
provides the audited financial statements as well as financial discussion and analysis.
This report is becoming a more common report from larger municipalities and is similar
to reports seen by publicly traded companies. The numbers in a financial statement
only provide a certain amount of information, to be usable to stakeholders’ additional
information may be beneficial. Staff include five-year charts to provide a trend analysis
of certain financial information.
2. Financial Statements for the Board of Management for
Historic Downtown Bowmanville Business Improvement Area
2.1 The Statement of Financial Position of the Bowmanville BIA increased in 2025 with
higher cash and cash equivalents stemming from increased fundraising revenue.
2.2 The fundraising revenue increased by $7,411, driven by successful events, such as
Maplefest, Moonlight Magic and Applefest.
2.3 Expenses were higher in 2025 versus 2024, with a total increase of $31,324. The
increase is mainly driven by higher events and promotional costs.
2.4 The Bowmanville BIA has an accumulated surplus of $117,996 (2024 – 103,567).
3. Financial Statements for the Board of Management for the
Newcastle Central Business District Improvement Area
3.1 The Newcastle BIA’s revenue was higher by $14,120 versus 2024, driven by higher
fundraising revenue during the year related to successful events.
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Report FSD-028-26
3.2 Expenses are higher by $28,976, which primarily is due to increased advertising and
event expenses for Canada day and Christmas / parade expenses.
3.3 The annual deficit of $15,528 decreases the accumulated surplus to $64,770, which
can be utilized in future years to promote and support the Newcastle BIA.
3.4 The net financial assets of the Newcastle BIA decreased by $33,514, which is a mainly
driven by the annual deficit of $16,613 and the purchase of tangible capital assets of
$16,801.
4. Financial Statements for the Orono Central Business District
Improvement Area
4.1 The main changes in the Orono BIA statement of financial position are a decrease of
cash of $9,428 and an increase in accounts receivable of $3,641, which is related to
the annual deficit of $5,951.
4.2 The Orono BIA saw a decrease in revenue of $9,878 for 2025 over 2024. This was
driven mainly by a decrease in transfers from reserve funds. In 2024, the transfer from
reserve funds was used to support improved lighting, branding and festival banners.
4.3 The 2025 expenses were in line with spending levels from 2024.
4.4 The annual deficit of $5,951 decreased the accumulated surplus to $8,411. The BIA
has an accumulated surplus which is sufficient to cover its liabilities.
5. Financial Statements for the Municipality of Clarington Trust
Funds
5.1 The Trust Funds consist of various trust funds administered by the Municipali ty of
Clarington. The Trust Funds include holdings related to the care and maintenance of
cemeteries and funds bequest to the Newcastle Community Hall. Trust Funds are not
included in the Municipality of Clarington’s consolidated financial statements. The
financial reporting is in accordance with the Canadian accounting standards for not-for-
profit organizations.
5.2 The Trusts do not have any liabilities and consist predominantly of investments, which
are primarily GICs. The due (to) from the Municipality of Clarington relates to expenses
incurred at the cemetery or funds received by the Municipality, which are due to be
transferred to the trust fund.
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Report FSD-028-26
5.3 During the year, $67,784 in care and maintenance receipts were received, with an
additional $69,372 of interest earned on the trust fund investments. The trusts
transferred $65,098 to the Municipality for the ongoing maintenance of the cemeteries.
6. Consolidated Financial Statements for the Municipality of
Clarington
Administrative
6.1 The letter stating management’s responsibility for the financial statements is a
requirement of PSAS and serves to emphasize that the financial statements are the
responsibility of the Municipality, not the auditors.
6.2 The Independent Auditor’s Report is in accordance with requirements of Canadian
Auditing Standards (CAS). The report indicates the auditor’s opinion on whether the
financial statements and the notes are in accordance with Canadian public sector
accounting standards. The audit opinion is “clean” which indicates that we are
materially compliant with applicable accounting standards.
Consolidated Statement of Financial Position
6.3 The Consolidated Statement of Financial Position is the public sector accounting
equivalent of a balance sheet. The statement provides a snapshot, as at December 31,
2025, of the assets, liabilities and accumulated surplus (an indicator of service
capacity) specifically on that day.
6.4 Net Financial Assets (the difference between financial assets and liabilities) decreased
by approximately $1.1 million in 2025. The financial asset-to-liability ratio of 1.5:1.0
shows that the Municipality is able to fulfill its financial obligations. The reserve and
reserve fund balances total $66.6 million and are slightly lower than the 2024 level of
$70.0 million.
6.5 A detailed breakdown of the accumulated surplus is presented in Note 20,
“Accumulated Surplus” of the Consolidated Financial Statements. The term
“accumulated surplus” does not mean and cannot be implied to mean that there are
“cash or funds” available for spending. Most of the value in the accumulated surplus
represents non-financial assets and reflects the Municipality’s investment in the
required infrastructure to deliver the programs and services that stakeholders expect.
Consolidated Statement of Operations
6.6 The Consolidated Statement of Operations is the public sector accounting equivalent of
an income statement in the private sector. The Consolidated Statement of Operations
Municipality of Clarington Page 7
Report FSD-028-26
provides a summary of revenue and expenses for the year, with the annual surplus
representing the difference between the cost of providing the Municipality’s services
and the revenues recognized during the year.
6.7 In accordance with PSAS, the Municipality uses the accrual basis of accounting rather
than the cash-basis. Revenue is recognized when it is earned, and expenses are
recognized when they are incurred, as opposed to when funds transfer.
6.8 The Consolidated Statement of Operations, as required by PSAS, lists revenues based
on like revenue streams (e.g., taxation, user charges, grants) and expenses based on
functional segments. The functional segments for expenses follows the Province of
Ontario’s Financial Information Return (FIR) segmentation on service lines.
6.9 Information on the segments’ revenues and expenses, including expense accounting
object (e.g., salaries and wages, operating materials, contract services), are included in
Schedule 2. Current year and prior year schedules are provided to allow for year -over-
year comparisons.
6.10 Schedule 3 shows the budgeted breakdown by segment for each accounting object.
This is not a required schedule; but is included to provide additional information to
users.
6.11 Property taxation includes the Municipality’s portion only. Funds which are co llected on
behalf of the Region of Durham, and the Province of Ontario (for education purposes)
are not shown as part of the Statement of Operations. The notes to the financial
statements contain a note disclosure on the funds which have been collected and
remitted on behalf of the other levels of government.
6.12 Investment income and deferred revenue experienced increases. Most of the deferred
revenue earned relates to development charges and is recognized when the asset is
recognized. Deferred revenue may also be recognized when grant obligations or
performance obligations are met.
6.13 Amortization expense is a non-cash expense which allocates the capital cost of assets
across the useful life of the asset.
6.14 Overall, the expenses for the Municipality were slightly above the 2025 budget, and
higher than 2024 actuals. It should be noted that the surplus and budget shown on the
statements are in accordance with PSAB and are not shown on the same basis that the
Municipality budgets annually (which uses a modified cash-basis). Note 22 in the
Consolidated Financial Statements contains a reconciliation of adopted budget to
PSAB financial statements budget figures.
Municipality of Clarington Page 8
Report FSD-028-26
6.15 The Consolidated Statement of Operations shows an annual surplus of $21.4 million for
2025; this compares to a $7.2 million surplus indicated in the budget column. This
variance is a result of the differing treatment between the cash-based budget process
and the accrual-based reporting process. Included in revenue is $7.4 million, the fair
market value of contributed assets transferred from developers (assumed subdivisions)
during the year. In future years there will be expenses related to these assets'
replacement, maintenance and repairs. As well, there was a significant donation from
Ontario Power Generation in 2025, in the amount of $14.0 million, which is reflected in
the increase in Donations and contributions from others revenue.
Consolidated Statement of Remeasurement Gains
6.16 The Consolidated Statement of Remeasurement Gains shows the impacts of certa in
unrealized gains on the financial instruments of the Municipality. In 2025, the gains
shown reflect the adjustment from cost to market value of the portfolio investments as
at December 31, 2025.
6.17 Unrealized gains and losses are transferred to the Consolidated Statement of
Operations once realized. The fluctuations in market are shown through this statement,
as an indicator of potential risk.
Consolidated Statement of Changes in Net Financial Assets
6.18 The purpose of the Consolidated Statement of Change in Net Financial Assets is to
provide financial statement users additional information on the Municipality’s financial
activities during the year.
6.19 The statement starts with the annual surplus and backs out non -financial activities such
as amortization, accounting gains/losses, and the purchase and sale of assets.
6.20 The main variances between 2025 and 2024 relate to the acquisition of tangible capital
assets and the difference in the assets under construction transferred to tangible
capital assets in 2025, as well as the impact of unrealized remeasurement gains for the
year.
Consolidated Statement of Cash Flows
6.21 The Consolidated Statement of Cash Flows explains how the organization financed its
activities and met its cash obligations. As is common with public se ctor entities, the
Municipality uses the indirect method of cash flow statements, which takes the annual
surplus/deficit and adjusts for non-cash transactions as well as the implied cash impact
through changes in the statement of financial position.
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Report FSD-028-26
6.22 The cash position of the Municipality decreased during the year from $105.6 million in
cash to $100.4 million. During the year, operating activities contributed to an increase
of $42.1 million, this includes the receipt of receivables as well as cash (development
charges) that are restricted to be used in future years.
6.23 Capital activities represent the investment the Municipality has made in its tangible
capital assets that are utilized in the delivery of services to stakeholders. The
Municipality invested $57.4 million in cash outlays in 2025.
6.24 The Municipality investment levels increased during 2025 by $38.9 million, mainly due
to the investment of debenture proceeds received in 2025, as the capital expenditures
associated with these funds will be expended in future years.
6.25 Financing activities during the year included repayment of $3.8 million in the principal of
long-term debenture debt and an increase in proceeds of debenture issue of $52.8
million.
7. Financial Considerations
Not Applicable.
8. Strategic Plan
Not Applicable.
9. Climate Change
Not Applicable.
10. Concurrence
Not Applicable.
11. Conclusion
It is respectfully recommended that the financial statements for the Municipality and its
components be approved (subject to the completion of the Deloitte LLP quality control
review, and possible minor wording or note disclosure adjustments), that Staff be
authorized to sign the final letters to complete the audit, and that Staff be directed to
finalize the Annual Financial Report with the approved financial statements.
Staff Contact: Michelle Pick, Accounting Services Manager/Deputy Treasurer, 905-623-3379
ext. 2605 or mpick@clarington.net.
Municipality of Clarington Page 10
Report FSD-028-26
Attachments:
Attachment 1 – Attachment 1 - Draft Financial Statements - Historic Downtown Bowmanville
BIA
Attachment 2 – Attachment 2 – Draft Financial Statements - Newcastle Central District BIA
Attachment 3 – Attachment 3 - Draft Financial Statements - Orono Central BIA
Attachment 4 – Attachment 4 - Draft Financial Statements - Municipality of Clarington Trusts
Attachment 5 – Attachment 5 - Draft Consolidated Financial Statements - Municipality of
Clarington
Interested Parties:
The following interested parties will be notified of Council's decision:
TD Bank
Ministry of Municipal Affairs and Housing
Bereavement Authority of Ontario
If this information is required in an alternate format, please contact the Accessibility Coordinator at (905) 623-3379 ext.
2563.
Financial statements of
The Corporation of the Municipality
of Clarington Board of Management
for Historic Downtown Bowmanville
Business Improvement Area
December 31, 2025
Attachment 1 to Report FSD-028-26
3
4
5
6
7
Independent Auditor’s Report 1–
Statement of financial position
Statement of operations
Statement of change in net financial assets
Statement of cash flows
Notes to the financial statements 8 –9
Deloitte LLP
Bay Adelaide East
8 Adelaide Street West
Suite 200
Toronto ON M5H 0A9
Canada
Tel: 416-601-6150
Fax: 416-601-6151
www.deloitte.ca
Independent Auditor’s Report
To the Members of Council of The Corporation of the Municipality of Clarington, Members of The Board
of Management for the Historic Downtown Bowmanville Business Improvement Area, Inhabitants and
Ratepayers of The Corporation of the Municipality of Clarington
Qualified Opinion
We have audited the financial statements of The Board of Management for the Historic Downtown
Bowmanville Business Improvement Area (the “BIA”), which comprise of the statement of financial
position as at December 31, 2025, and the statements of operations, changes in net financial assets and
cash flows for the year then ended, and notes to the financial statements, including a summary of
significant accounting polices (collectively referred to as the “financial statements”).
In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion
section of our report, the accompanying financial statements present fairly, in all material respects, the
financial position of the BIA as at December 31, 2025, and the results of its operations, its changes in net
financial assets, and its cash flows for the year then ended in accordance with Canadian public sector
accounting standards.
Basis for Qualified Opinion
The BIA derives revenue from fundraising activities the completeness of which is not susceptible to
satisfactory audit verification. Accordingly, our verification of these revenues was limited to the amounts
recorded in the records of the BIA and we were not able to determine whether any adjustments might be
necessary to fundraising revenue, annual surplus, and cash flows from operations for the years ended
December 31, 2025 and 2024, financial assets as at December 31, 2025 and 2024, and net financial assets
as at January 1 and December 31 for both the 2025 and 2024 years.
We conducted our audit in accordance with Canadian generally accepted auditing standards
(“Canadian GAAS”). Our responsibilities under those standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the BIA in accordance with the ethical requirements that are relevant to our audit of the
financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our qualified opinion.
Other Matter
The financial statements for the year ended December 31, 2024 were audited by another auditor who
expressed a qualified opinion on those statements on July 14, 2025 for the reasons described in the Basis
for Qualified Opinion section of our report.
Responsibilities of Management and Those Charged with Governance for the
Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with Canadian public sector accounting standards, and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the BIA’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the BIA or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the BIA’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with Canadian GAAS, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the BIA’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the BIA’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the BIA to cease to continue as a going
concern.
Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
Chartered Professional Accountants
Licensed Public Accountants
________, 2026
The Corporation of the Municipality of Clarington Board of Management for the
Historic Downtown Bowmanville Business District Improvement Area
Statement of financial position
As at December 31, 2025
2024
Notes $
Financial assets
Cash and cash equivalents 103,997
Harmonized Sales Tax receivable 4,473
108,470
Liabilities
Accounts payable 4,903
Net financial assets 103,567
Accumulated surplus 103,567
2025
$
114,066
4,507
118,573
577
117,996
117,996
The accompanying notes are an integral part of these financial statements.
Page 4
The Corporation of the Municipality of Clarington Board of Management for the
Historic Downtown Bowmanville Business District Improvement Area
Statement of operations
Year ended December 31, 2025
Budget 2025 2024
Notes $ $ $
(Note 2) (Note 5)
Revenues
Taxation - Municipality of Clarington 3 184,821 184,821 180,314
Fundraising 68,957 86,856 79,445
253,778 271,677 260,892
Expenses
Administration 24,853 6,243 5,853
Events and promotion 134,000 127,469 105,000
Salaries and wages 43,150 82,498 73,700
Streetscape 46,950 41,038 40,238
Capital works 29,850 — —
278,803 257,248 225,924
Annual (deficit) surplus (25,025) 14,429 34,968
Accumulated surplus, beginning of year 103,567 103,567 68,599
Accumulated surplus, end of year 78,542 117,996 103,567
The accompanying notes are an integral part of these financial statements.
Page 5
The Corporation of the Municipality of Clarington Board of Management for the
Historic Downtown Bowmanville Business District Improvement Area
Statement of change in net financial assets
As at December 31, 2025
Budget
$
(Note 2)
2025
$
2024
$
Annual (deficit) surplus
Net financial assets, beginning of year
Net financial assets, end of year
(25,025)
103,567
78,542
14,429
103,567
117,996
34,968
68,599
103,567
The accompanying notes are an integral part of these financial statements.
Page 6
The Corporation of the Municipality of Clarington Board of Management for the
Historic Downtown Bowmanville Business District Improvement Area
Statement of cash flows
Year ended December 31, 2025
2025 2024
$ $
Operating activities
Annual surplus 14,429 34,968
Changes in non-cash operating items
Harmonized Sales Tax receivable (34) (515)
Accounts payable (4,326) 4,903
10,069 39,356
Net increase in cash 10,069 39,356
Cash, beginning of year 103,997 64,641
Cash, end of year 114,066 103,997
The accompanying notes are an integral part of these financial statements.
Page 7
The Corporation of the Municipality of Clarington Board of Management for the
Historic Downtown Bowmanville Business District Improvement Area
Notes to the financial statements
December 31, 2025
The Corporation of the Municipality of Clarington Board of Management for Historic Downtown
Bowmanville Business Improvement Area (the “Board”) is a Municipal Local Board in the Province of
Ontario, Canada. It conducts its operations guided by the provisions of provincial statutes such as the
Municipal Act and related legislation.
1. Significant accounting policies
The financial statements of the Board are the representations of management prepared in
accordance with Canadian public sector accounting standards (“PSAS”).
The focus of the financial statements is on the financial position of the Board and the changes
thereto. The Statement of Financial Position includes the assets and liabilities of the Board.
Financial assets are those assets which could provide resources to discharge existing liabilities
or finance future operations.
Non-financial assets are not available to discharge existing liabilities and are held for use in the
provision of services. They have useful lives extending beyond the current year and are not
intended for sale in the ordinary course of operations.
Accumulated surplus represents the difference between assets and liabilities of the Board. This
provides information about the Board’s overall future revenue requirements and its ability to
finance operations and meet its obligations.
(a) Revenue recognition
Taxation revenue is recorded when earned and is based on a special assessment. Other
revenues are recorded in the period in which transactions or events occurred that gave rise
to the revenues.
(b) Use of estimates
The preparation of financial statements in conformity with PSAS requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenue and expenses during the year. Actual results could
differ from those estimates.
(c) Cash and cash equivalents
Cash and cash equivalents are made up of cash held in financial institutions as well as
temporary investments with maturities of 90 days or less.
(d) Accounts receivable
Accounts receivable includes amounts to be received that can be reasonably estimated and
collection is reasonably assured.
2. Budget data
As per the Board’s By-laws, the budget information presented in these financial statements is
based on the budget approved by the Board Members on February 11, 2025.
3. Related party transactions
The Board is controlled by The Corporation of the Municipality of Clarington (the “Municipality”)
and is dependent on the Municipality for funding through taxes levied by the Municipality on
behalf of the Board on an annual basis.
During the year, the Board received $184,821 ($180,314 in 2024) of taxes levied by the
Municipality on behalf of the Board.
Page 8
The Corporation of the Municipality of Clarington Board of Management for the
Historic Downtown Bowmanville Business District Improvement Area
Notes to the financial statements
December 31, 2025
4. Risk management
The Board has exposure to the following risks from its use of financial instruments:
credit risk and liquidity risk.
(a) Credit risk
Credit risk is the risk of a financial loss to the Board if a customer or counterparty
to a financial instrument fails to meet its contractual obligations. Such risks arise
principally from certain financial assets held by the Board consisting of accounts
receivable. The Board’s exposure to credit risk associated with accounts receivable
is assessed as low because they are due from governments.
(b) Liquidity risk
Liquidity risk is the risk that the Board will not be able to meet its financial
obligations as they become due. The Board’s objective is to have sufficient liquidity
to meet these liabilities when due. The Board monitors its cash balance and cash
flows generated from operations to meet its liquidity requirements. The liquidity
risk arises from the financial liabilities consisting of accounts payable.
5. Comparative amounts
Certain of the prior year comparative amounts have been reclassified to conform to the current
year’s financial statement presentation.
Page 9
If this information is required in an alternate format, please contact the Accessibility Coordinator at (905) 623-3379 ext.
2563.
Financial statements of
The Corporation of the Municipality
of Clarington Board of Management
for the Newcastle Central Business
District Improvement Area
December 31, 2025
Attachment 2 to Report FSD-028-26
3
4
5
6
7
Independent Auditor’s Report 1–
Statement of financial position
Statement of operations
Statement of change in net financial assets
Statement of cash flows
Notes to the financial statements 8–9
Tel: 416-601-6150
Fax: 416-601-6151
www.deloitte.ca
Independent Auditor’s Report
To the Members of Council of The Corporation of the Municipality of Clarington, Members of The Board
of Management for the Newcastle Central Business Improvement Area, Inhabitants and Ratepayers of
The Corporation of the Municipality of Clarington
Qualified Opinion
We have audited the financial statements of The Board of Management for the Newcastle Central
Business Improvement Area (the “BIA”), which comprise of the statement of financial position as at
December 31, 2025, and the statements of operations, changes in net financial assets and cash flows for
the year then ended, and notes to the financial statements, including a summary of significant accounting
polices (collectively referred to as the “financial statements”).
In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion
section of our report, the accompanying financial statements present fairly, in all material respects, the
financial position of the BIA as at December 31, 2025, and the results of its operations, its changes in net
financial assets, and its cash flows for the year then ended in accordance with Canadian public sector
accounting standards.
Basis for Qualified Opinion
The BIA derives revenue from fundraising activities the completeness of which is not susceptible to
satisfactory audit verification. Accordingly, our verification of these revenues was limited to the amounts
recorded in the records of the BIA and we were not able to determine whether any adjustments might be
necessary to fundraising revenue, annual deficit, and cash flows from operations for the years ended
December 31, 2025 and 2024, financial assets as at December 31, 2025 and 2024, and net financial assets
as at January 1 and December 31 for both the 2025 and 2024 years.
We conducted our audit in accordance with Canadian generally accepted auditing standards
(“Canadian GAAS”). Our responsibilities under those standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the BIA in accordance with the ethical requirements that are relevant to our audit of the
financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our qualified opinion.
Other Matter
The financial statements for the year ended December 31, 2024 were audited by another auditor who
expressed a qualified opinion on those statements on July 14, 2025 for the reasons described in the Basis
for Qualified Opinion section of our report.
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with Canadian public sector accounting standards, and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the BIA’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the BIA or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the BIA’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with Canadian GAAS, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the BIA’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the BIA’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the BIA to cease to continue as a going
concern.
Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
Chartered Professional Accountants
Licensed Public Accountants
________, 2026
The Corporation of the Municipality of Clarington Board of Management for the
Newcastle Central Business District Improvement Area
Statement of financial position
As at December 31, 2025
2024
Notes $
Financial assets
Cash and cash equivalents 82,021
Inventory for resale —
82,021
Liabilities
Accounts payable 1,723
Net financial assets 80,298
Non-financial assets
Tangible capital assets 4 —
Prepaid expense —
Total non-financial assets —
Accumulated surplus 80,298
2025
$
42,348
6,086
48,434
565
47,869
14,401
2,500
16,901
64,770
The accompanying notes are an integral part of these financial statements.
Approved on behalf of the Board
Chair
The Corporation of the Municipality of Clarington Board of Management for the
Newcastle Central Business District Improvement Area
Statement of operations
Year ended December 31, 2025
2025 2024
Budget Actual Actual
Notes $ $ $
(Note 2)
Revenues
Taxation - Municipality of Clarington 5 40,000 40,000 40,000
Fundraising — 64,351 50,231
40,000 104,351 90,231
Expenses
Administration 2,000 3,795 5,296
Advertising 10,000 12,019 9,764
Events 5,000 80,679 53,695
Downtown safety and décor 23,000 20,986 22,148
Amortization expense — 2,400 —
40,000 119,879 90,903
Annual deficit — (15,528) (672)
Accumulated surplus, beginning of year 80,298 80,298 80,970
Accumulated surplus, end of year 80,298 64,770 80,298
The accompanying notes are an integral part of these financial statements.
The Corporation of the Municipality of Clarington Board of Management for the
Newcastle Central Business District Improvement Area
Statement of change in net financial assets
As at December 31, 2025
Budget 2025 2024
$ $ $
(Note 2)
Annual deficit — (15,528) (672)
Acquisition of tangible capital assets — (16,801) —
Amortization of tangible capital assets — 2,400 —
Acquisition of prepaid expenses — (2,500) —
Decrease in net financial assets — (32,429) (672)
Net financial assets, beginning of year 80,298 80,298 80,970
Net financial assets, end of year 80,298 47,869 80,298
The accompanying notes are an integral part of these financial statements.
The Corporation of the Municipality of Clarington Board of Management for the
Newcastle Central Business District Improvement Area
Statement of cash flows
Year ended December 31, 2025
2025 2024
$ $
Operating activities
Annual deficit
Non-cash item
Amortization of tangible capital assets
Changes in non-cash operating items
Inventory for resale
Accounts payable
Prepaid expense
Capital activity
Acquisition of tangible capital assets
(15,528) (672)
2,400 —
(6,086) —
(1,158) 847
(2,500) —
(22,872) 175
(16,801) —
Net (decrease) increase in cash (39,673) 175
Cash, beginning of year 82,021 81,846
Cash, end of year 42,348 82,021
The accompanying notes are an integral part of these financial statements.
The Corporation of the Municipality of Clarington Board of Management for the
Newcastle Central Business District Improvement Area
Notes to the financial statements
December 31, 2025
1. Significant accounting policies (continued)
(f) Tangible capital assets
Tangible capital assets are not available to discharge existing liabilities and are held for use
in the provision of services. They have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
Tangible capital assets are recorded at cost, which includes amounts that are directly
attributable to acquisition, construction, development or betterment of the asset.
Amortization tangible capital assets is provided on a straight-line basis as follows:
Equipment 7 years
2. Budget data
As per the Board’s By-laws, the budget information presented in these financial statements is
based on the budget approved by the Board Members on January 28, 2025.
3. Tangible capital assets
2025
Accumulated Net book
Cost amortization value
$$$
Equipment 16,801 2,400 14,401
4. Related party balances and transactions
The Board is controlled by The Corporation of the Municipality of Clarington (the “Municipality”)
and is dependent on the Municipality for funding through taxes levied by the Municipality on
behalf of the Board on an annual basis.
During the year, the Board received $40,000 ($40,000 in 2024) of taxes levied by the
Municipality on behalf of the Board.
5. Risk management
The Board has exposure to the following risks from its use of financial instruments: credit risk
and liquidity risk.
(a) Credit risk
Credit risk is the risk of a financial loss to the Board if a customer or counterparty to a
financial instrument fails to meet its contractual obligations. Such risks arise principally from
certain financial assets held by the Board consisting of accounts receivable. The Board’s
exposure to credit risk associated with accounts receivable is associated as low because the
Board assesses, on a continuous basis, amounts receivable on the basis of amounts for
which ultimate collection is reasonably assured.
Page 8
The Corporation of the Municipality of Clarington Board of Management for the
Newcastle Central Business District Improvement Area
Notes to the financial statements
December 31, 2025
5. Risk management (continued)
(b) Liquidity risk
Liquidity risk is the risk that the Board will not be able to meet its financial obligations as
they become due. The Board’s objective is to have sufficient liquidity to meet these liabilities
when due. The Board monitors its cash balance and cash flows generated from operations to
meet its liquidity requirements. The liquidity risk arises from the financial liabilities
consisting of accounts payable.
Page 9
If this information is required in an alternate format, please contact the Accessibility Coordinator at (905) 623-3379
ext. 2563.
Financial statements of
The Corporation of the Municipality
of Clarington Board of Management
for the Orono Central Business
District Improvement Area
December 31, 2025
Attachment 3 to Report FSD-028-26
3
4
5
6
7
Independent Auditor’s Report 1–
Statement of financial position
Statement of operations
Statement of change in net financial assets
Statement of cash flows
Notes to the financial statements 8–9
Deloitte LLP
Bay Adelaide East
8 Adelaide Street West
Suite 200
Toronto ON M5H 0A9
Canada
Tel: 416-601-6150
Fax: 416-601-6151
www.deloitte.ca
Independent Auditor’s Report
To the Members of Council of The Corporation of the Municipality of Clarington, Members of The Board
of Management for the Orono Central Business Improvement Area, Inhabitants and Ratepayers of The
Corporation of the Municipality of Clarington
Qualified Opinion
We have audited the financial statements of The Board of Management for the Orono Central Business
Improvement Area (the “BIA”), which comprise of the statement of financial position as at December 31,
2025, and the statements of operations, changes in net financial assets and cash flows for the year then
ended, and notes to the financial statements, including a summary of significant accounting polices
(collectively referred to as the “financial statements”).
In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion
section of our report, the accompanying financial statements present fairly, in all material respects, the
financial position of the BIA as at December 31, 2025, and the results of its operations, its changes in net
financial assets, and its cash flows for the year then ended in accordance with Canadian public sector
accounting standards.
Basis for Qualified Opinion
The BIA derives revenue from donations and fundraising activities the completeness of which is not
susceptible to satisfactory audit verification. Accordingly, our verification of these revenues was limited to
the amounts recorded in the records of the BIA and we were not able to determine whether any
adjustments might be necessary to donation and fundraising revenue, annual surplus, and cash flows
from operations for the years ended December 31, 2025 and 2024, financial assets as at December 31,
2025 and 2024, and net financial assets as at January 1 and December 31 for both the 2025 and 2024
years.
We conducted our audit in accordance with Canadian generally accepted auditing standards
(“Canadian GAAS”). Our responsibilities under those standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the BIA in accordance with the ethical requirements that are relevant to our audit of the
financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our qualified opinion.
Other Matter
The financial statements for the year ended December 31, 2024 were audited by another auditor who
expressed a qualified opinion on those statements on July 14, 2025 for the reasons described in the Basis
for Qualified Opinion section of our report.
Responsibilities of Management and Those Charged with Governance for the
Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with Canadian public sector accounting standards, and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the BIA’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the BIA or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the BIA’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with Canadian GAAS, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the BIA’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the BIA’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the BIA to cease to continue as a going
concern.
Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
Chartered Professional Accountants
Licensed Public Accountants
________, 2026
The Corporation of the Municipality of Clarington Board of Management for the
Orono Central Business District Improvement Area
Statement of financial position
As at December 31, 2025
2024
Notes $
Financial assets
Cash and cash equivalents 14,362
Accounts receivable 3 —
14,362
Liabilities
Accounts payable —
Net financial assets 14,362
14,362 Accumulated surplus
2025
$
4,934
3,641
8,575
164
8,411
8,411
The accompanying notes are an integral part of these financial statements.
Page 4
Notes
Budget
$
2025
$
2024
$
(Note 2)
1,5 6,000 6,000 6,000
4,000 2,000 —
5,500 8,013 9,891
— — 10,000
15,500 16,013 25,891
21,850 16,755 14,692
4,200 3,565 3,464
1,240 1,644 3,522
27,290 21,964 21,678
(11,790)
14,362
(5,951)
14,362
4,213
10,149
2,572 8,411 14,362
The Corporation of the Municipality of Clarington Board of Management for the
Orono Central Business District Improvement Area
Statement of operations
Year ended December 31, 2025
Revenues
Taxation - Municipality of Clarington
Grants - Provincial
Donations, fundraising and miscellaneous
Contribution from reserve funds
Expenses
Advertising and promotion
Landscaping
Miscellaneous
Annual (deficit) surplus
Accumulated surplus, beginning of year
Accumulated surplus, end of year
The accompanying notes are an integral part of these financial statements.
Page 5
The Corporation of the Municipality of Clarington Board of Management for the
Orono Central Business District Improvement Area
Statement of change in net financial assets
As at December 31, 2025
Budget
$
(Note 2)
2025
$
2024
$
Annual (deficit) surplus
Net financial assets, beginning of year
Net financial assets, end of year
(11,790)
14,362
2,572
(5,951)
14,362
8,411
4,213
10,149
14,362
The accompanying notes are an integral part of these financial statements.
Page 6
The Corporation of the Municipality of Clarington Board of Management for the
Orono Central Business District Improvement Area
Statement of cash flows
Year ended December 31, 2025
Operating activities
Annual (deficit) surplus
Changes in non-cash operating items
Accounts receivable
Accounts payable
Net (decrease) increase in cash
Cash, beginning of year
Cash, end of year
The accompanying notes are an integral part of these financial statements.
2025 2024
$ $
(5,951) 4,213
(3,641) —
164 (1,480)
(9,428) 2,733
(9,428) 2,733
14,362 11,629
4,934 14,362
Page 7
The Corporation of the Municipality of Clarington Board of Management for the
Orono Central Business District Improvement Area
Notes to the financial statements
December 31, 2025
The Corporation of the Municipality of Clarington Board of Management for the Orono Central Business
District Improvement Area (the “Board”) is a Municipal Local Board in the Province of Ontario, Canada.
It conducts its operations guided by the provisions of provincial statutes such as the Municipal Act and
related legislation.
1. Significant accounting policies
The financial statements of the Board are the representations of management prepared in
accordance with Canadian public sector accounting standards (“PSAS”).
The focus of the financial statements is on the financial position of the Board and the changes
thereto. The Statement of Financial Position includes the assets and liabilities of the Board.
Financial assets are those assets which could provide resources to discharge existing liabilities
or finance future operations.
Non-financial assets are not available to discharge existing liabilities and are held for use in the
provision of services. They have useful lives extending beyond the current year and are not
intended for sale in the ordinary course of operations.
Accumulated surplus represents the difference between assets and liabilities of the Board. This
provides information about the Board’s overall future revenue requirements and its ability to
finance operations and meet its obligations.
(a) Revenue recognition
Taxation revenue is recorded when earned and is based on a special assessment.
Grant revenue is recognized as revenue as funds are spent in accordance with the grant
restriction and reasonably estimated and collection is reasonably assured.
Other revenues are recorded in the period in which transactions or events occurred that
gave rise to the revenues.
(b) Use of estimates
The preparation of financial statements in conformity with PSAS requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenue and expenses during the year. Actual results could
differ from those estimates.
(c) Cash and cash equivalents
Cash and cash equivalents are made up of cash held in financial institutions as well as
temporary investments with maturities of 90 days or less.
(d) Accounts receivable
Accounts receivable includes amounts to be received that can be reasonably estimated and
collection is reasonably assured.
Page 8
The Corporation of the Municipality of Clarington Board of Management for the
Orono Central Business District Improvement Area
Notes to the financial statements
December 31, 2025
2. Budget data
As per the Board’s By-laws, the budget information presented in these financial statements is
based on the budget approved by the Board Members on September 22, 2023 as part of the
2024 to 2027 multiyear budget submission.
3. Accounts receivable
As of December 31, 2025, $1,116 (nil in 2024) is receivable from customers for merchandise
sales and $2,525 (nil in 2024) relate to donations which were collected subsequent to the year-
end.
4. Related party balances and transactions
The Board is controlled by The Corporation of the Municipality of Clarington (the “Municipality”)
and is dependent on the Municipality for funding through taxes levied by the Municipality on
behalf of the Board on an annual basis.
During the year, the Board received $6,000 ($6,000 in 2024) of taxes levied by the Municipality
on behalf of the Board.
5. Risk management
The Board has exposure to the following risks from its use of financial instruments: credit risk
and liquidity risk.
(a) Credit risk
Credit risk is the risk of a financial loss to the Board if a customer or counterparty to a
financial instrument fails to meet its contractual obligations. Such risks arise principally from
certain financial assets held by the Board consisting of accounts receivable. The Board’s
exposure to credit risk associated with accounts receivable is assessed as low because the
Board assesses, on a continuous basis, amounts receivable on the basis of amounts for
which ultimate collection is reasonably assured.
(b) Liquidity risk
Liquidity risk is the risk that the Board will not be able to meet its financial obligations as
they become due. The Board’s objective is to have sufficient liquidity to meet these liabilities
when due. The Board monitors its cash balance and cash flows generated from operations to
meet its liquidity requirements. The liquidity risk arises from the financial liabilities
consisting of accounts payable.
Page 9
If this information is required in an alternate format, please contact the Accessibility Coordinator at (905) 623-3379 ext.
2563.
Financial statements of
The Corporation of the
Municipality of Clarington
Trust Funds
December 31, 2025
Attachment 4 to Report FSD-028-26
Independent Auditor’s Report 1–3
Statement of financial position 4
Statement of operations and changes in fund balances 5
Statement of cash flows 6
Notes to the financial statements 7–9
Deloitte LLP
Bay Adelaide East
8 Adelaide Street West
Suite 200
Toronto ON M5H 0A9
Canada
Tel: 416-601-6150
Fax: 416-601-6151
www.deloitte.ca
Independent Auditor’s Report
To the Members of Council of
The Corporation of the Municipality of Clarington
Opinion
We have audited the financial statements of The Corporation of the Municipality of Clarington Trust
Funds (the “Trust Funds”), which comprise of the statement of financial position as at December 31,
2025, and the statements of operations and changes in fund balances, and cash flows for the year then
ended, and notes to the financial statements, including a summary of significant accounting polices
(collectively referred to as the “financial statements”).
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial
position of the Trust Funds as at December 31, 2025, and the results of its operations and its cash flow for
the year then ended in accordance with Canadian accounting standards for not-for-profit organizations.
Basis for Opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards
(“Canadian GAAS”). Our responsibilities under those standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the Trust Funds in accordance with the ethical requirements that are relevant to our
audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
Other Matter
The financial statements for the year ended December 31, 2024 were audited by another auditor who
expressed an unmodified opinion on those statements on July 15, 2025.
Responsibilities of Management and Those Charged with Governance for the
Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with Canadian accounting standards for not-for-profit organizations, and for such internal
control as management determines is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Trust Funds’ ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the Trust Funds or to
cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Trust Funds’ financial reporting
process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with Canadian GAAS, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Trust Funds’ internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Trust Funds’ ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
report to the related disclosures in the financial statements or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Trust Funds to cease to
continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
Chartered Professional Accountants
Licensed Public Accountants
________, 2026
The Corporation of the Municipality of Clarington Trust Funds
Statement of financial position
As at December 31, 2025
Current assets
Due from
Interest Municipality
Investments receivable of Clarington Fund balances
$ $ $ $
(Note 3)
Advent Cemetery 918 2 — 920
Bondhead Cemetery 296,870 578 — 297,448
Bowmanville Cemetery 1,457,820 2,836 3,918 1,464,574
Hampton Cemetery 53,101 103 — 53,204
Lakeview Cemetery 70,044 137 — 70,181
Lovekin Cemetery 10,000 19 — 10,019
Orono Cemetery 320,242 623 — 320,865
St. George’s Cemetery 50,390 98 — 50,488
Trulls Cemetery 1,774 3 — 1,777
Vanderveer Legacy Trust 1,000 2 — 1,002
2,262,159 4,401 3,918 2,270,478
Montague Trust 12,225 118 — 12,343
Estate of Irene Rinch/Newcastle
Community Hall 167,834 1,623 — 169,457
Total - 2025 2,442,218 6,142 3,918 2,452,278
Total - 2024 2,366,306 8,841 5,073 2,380,220
Total - January 1, 2024 (Note 2) 2,196,265 12,176 10,315 2,218,756
The accompanying notes are an integral part of these financial statements.
Page 4
The Corporation of the Municipality of Clarington Trust Funds
Statement of operations and changes in fund balances
Year ended December 31, 2025
Revenues
Less: Excess
Fund balances Care and contribution (deficiency) of
beginning of maintenance Other to revenues over Fund balances
year receipts Interest contributions Total cemeteries expenses end of year
$ $ $ $ $ $ $ $
(Note 2) (Note 4)
Advent Cemetery 921 — 26 — 26 27 (1) 920
Bondhead Cemetery 286,133 11,517 8,243 — 19,760 8,445 11,315 297,448
Bowmanville Cemetery 1,412,800 52,806 40,788 — 93,594 41,820 51,774 1,464,574
Hampton Cemetery 52,533 712 1,507 — 2,219 1,548 671 53,204
Lakeview Cemetery 69,857 379 1,992 — 2,371 2,047 324 70,181
Lovekin Cemetery 10,028 — 286 — 286 295 (9) 10,019
Orono Cemetery 318,744 2,370 9,108 — 11,478 9,357 2,121 320,865
St. George's Cemetery 50,529 — 1,437 — 1,437 1,478 (41) 50,488
Trulls Cemetery 1,779 — 51 — 51 53 (2) 1,777
Vanderveer Legacy Trust 1,003 — 27 — 27 28 (1) 1,002
2,204,327 67,784 63,465 — 131,249 65,098 66,151 2,270,478
Montague Trust 11,942 — 401 — 401 — 401 12,343
Estate of Irene Rinch/Newcastle
Community Hall 163,951 — 5,506 — 5,506 — 5,506 169,457
Total - 2025 2,380,220 67,784 69,372 — 137,156 65,098 72,058 2,452,278
Total - 2024 2,218,756 86,758 108,991 69,466 265,215 103,751 161,464 2,380,220
The accompanying notes are an integral part of these financial statements.
Page 5
The Corporation of the Municipality of Clarington Trust Funds
Statement of cash flows
Year ended December 31, 2025
2025 2024
$ $
(Note 2)
Operating activities
Excess of revenue over expenses 72,058 161,464
Change in non-cash working capital items
Interest receivable 2,699 3,335
Due from Municipality of Clarington 1,155 5,242
75,912 170,041
Investing activity
Purchase of investments (75,912) (170,041)
Net increase in cash — —
Cash, beginning of year — —
Cash, end of year — —
The accompanying notes are an integral part of these financial statements.
Page 6
The Corporation of the Municipality of Clarington Trust Funds
Notes to the financial statements
December 31, 2025
The Corporation of the Municipality of Clarington Trust Funds (the “Trust Funds”) consist of various
trust funds administered by the Corporation of the Municipality of Clarington (the “Municipality”). The
Trust Funds include holdings related to the care and maintenance of cemeteries and bequests of
funds to the Newcastle Community Hall.
1. Significant accounting policies
The financial statements of the Trust Funds are the representations of management prepared in
accordance with Canadian accounting standards for not-for-profit organizations and reflect the
following policies:
Basis of accounting
Revenues are recorded in the period in which the transactions or events occurred that gave rise
to the revenue. Interest revenue is recorded as earned.
Expenditures are recorded in the period the goods and services are acquired and a liability is
incurred. Refunds are reported in the period issued.
Financial instruments
The Trust Funds has selected the following classifications and measurements for its financial
instruments’ assets and liabilities:
Asset/liability Category
Cash Fair value
Investments Cost
Interest receivable Amortized cost
Due from Municipality of Clarington Amortized cost
Financial assets and financial liabilities are initially recognized at fair value when the Trust Funds
becomes a party to the contractual provisions of the financial instrument.
Financial assets and financial liabilities originated or exchanged in related party transactions are
initially measured at cost. When the instrument has repayment terms, cost is determined using
its undiscounted cash flows, excluding interest payments, less any impairment losses. Otherwise,
the cost is determined using the consideration transferred or received by the Trust Funds.
Subsequently, all financial instruments are measured at amortized cost, with the exception of
cash.
Financial assets measured at amortized cost are assessed at each reporting date for indications
of impairment. If such impairment exists, the asset is written down and the resulting impairment
loss is recognized in the statement of operations and changes in fund balances.
Use of estimates
The preparation of the financial statements in conformity with Canadian accounting standards for
not-for-profit organizations, requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amount of revenues and
expenditures during the year. Actual results could differ from these estimates. There are no
significant estimates in these financial statements.
Page 7
The Corporation of the Municipality of Clarington Trust Funds
Notes to the financial statements
December 31, 2025
2. Impact of the change in the basis of accounting
These financial statements are the first financial statements for which the Trust Funds applied
Canadian accounting standards for not-for-profit organizations as the financial reporting
framework. Prior to January 1, 2025, the Trust Funds followed Canadian Public Sector Accounting
Standards. First-time adoption of this basis of accounting had no impact on the statement of
financial position as at the transition date, January 1, 2024, or on the excess of revenue over
expenses for the year ended December 31, 2024. However, adopting these standards resulted in
the addition of a statement of cash flows for the year ended December 31, 2024, which is
unaudited.
3. Investments
The total investments held by the trust funds of $2,442,218 ($2,366,306 in 2024) reported on
the Statement of Financial Position at cost have a fair value of $2,447,303 ($2,372,583 in 2024)
at the end of the year. The investments consist of holdings pursuant to the provisions of the
Municipality’s investment policy and comprise guaranteed investment certificates issued by a
financial institution. It is the Trust Funds’ intention to hold these investments until maturity. The
investments have interest rates ranging from 2.05% to 2.40% (2024 - 2.75 – 4.03%) with
maturity dates ranging from August 6, 2026, to September 4, 2026 (2024 – August 6, 2025 –
September 8, 2025).
4. Care and maintenance funds
The Care and Maintenance Funds administered by the Municipality are funded by the sale of
cemetery plots. These funds are invested, and the interest earned is used to perform care and
maintenance to the Municipality’s cemeteries. The operations and investments of these funds are
undertaken by the Municipality in accordance with the regulations of the Cemeteries Act.
5. Related party transactions
Related party transactions include $3,918 ($5,073 in 2024) receivable from the Municipality as at
December 31, 2025.
6. Government remittances
There are no amounts outstanding with regards to government remittances as at December 31,
2025, and 2024.
7. Risk management
Credit risk
Credit risk is the risk of a financial loss to the Trust Fund if a counterparty to a financial
instrument fails to meet its contractual obligations. Credit risk arises from the Trust Funds’
accounts receivable. The Trust Funds’ exposure to credit risk is assessed as low because amounts
are receivable from a reputable financial institution and the Municipality, and therefore ultimate
collection is reasonably assured.
Page 8
The Corporation of the Municipality of Clarington Trust Funds
Notes to the financial statements
December 31, 2025
7. Risk management (continued)
Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will
fluctuate because of changes in market prices. Market risk comprises three types of risk:
currency risk, interest rate risk and equity risk.
a) Currency risk:
Currency risk is the risk that the fair value of future cash flows of a financial
instrument will fluctuate because of changes in foreign currency rates. The Trust
Funds are not exposed to currency risk.
b) Interest risk:
Interest rate risk is the potential for financial loss caused by fluctuations in fair
value or future cash flows of financial instruments because of changes in market
interest rates. The Trust Funds are exposed to this risk through its interest-bearing
investments.
c) Equity risk:
Equity risk is the uncertainty associated with the valuation of assets arising from
changes in equity markets. The Trust Funds are not exposed to equity risk.
There were no changes to risk exposures from the prior year.
Page 9
If this information is required in an alternate format, please contact the Accessibility Co-ordinator at
905-623-3379 ext. 2563
The Corporation of the Municipalit of Clarin ton
Consolidated Financial Statements
December 31, 2025
Attachment 5 to Report FSD-028-26
Table of Contents
Pa e
Consolidated Financial Statements
Management's Responsiblity for the Consolidated Finanacial Statements
1 - 3Independent Auditor's Report
Consolidated Statement of Financial Position 4
Consolidated Statement of Operations 5
Consolidated Statement of Remeasurement Gains (Losses) 6
Consolidated Statement of Change in Net Financial Assets 7
Consolidated Statement of Cash Flows 8
Notes to the Consolidated Financial Statements 9 - 38
Consolidated Schedule of Tangible Capital Assets - Schedule 1 39 - 40
Consolidated Schedule of Segmented Information - Actual - Schedule 2 41 - 42
Consolidated Schedule of Segmented Information - Budget - Schedule 3 43 - 44
Supplementary Statement of Operations - Library and Museum 45 - 46
The Corporation of the Municipality of Clarington
December 31, 2025
Management’s Responsibility for the Consolidated Financial Statements
The accompanying consolidated financial statements of the Corporation of the
Municipality of Clarington are the responsibility of the Municipality’s management and
have been prepared in accordance with Canadian public sector accounting standards.
The preparation of the financial statements necessarily involves the use of estimates
based on management’s judgment, particularly when transactions affecting the current
accounting period cannot be finalized with certainty until future periods.
The Corporation maintains a system of internal controls designed to provide reasonable
assurance that the financial information is relevant, reliable, and accurate, that
transactions are properly authorized, and the Corporation’s assets are properly
accounted for and adequately safeguarded.
The financial statements have been audited by Deloitte LLP, Chartered Professional
Accountants, the external auditors for the Corporation. The responsibility of the external
auditor is to express an opinion on whether the financial statements are fairly
presented, in all material respects, in accordance with Canadian public sector
accounting standards.
Council is responsible for ensuring that management fulfills its responsibility for financial
reporting and internal control. Council meets periodically with management, as well as
the external auditors to satisfy itself that each party is properly discharging its
responsibilities with respect to internal controls and financial reporting.
The external auditor reviews the consolidated financial statements and discusses any
significant financial reporting or internal control matters prior to the approval of the
consolidated financial statements by Council.
Trevor Pinn, CPA, CA Michelle Pick, CPA, CGA
Deputy CAO / Treasurer Accounting Services Manager / Deputy Treasurer
_______, 2026 _______ , 2026
Independent Auditor’s Report
To the Members of Council of
The Corporation of the Municipality of Clarington
Opinion
We have audited the consolidated financial statements of The Corporation of the Municipality of
Clarington (the “Municipality”), which comprise of the consolidated statement of financial position
as at December 31, 2025, and the consolidated statements of operations, the consolidated
statement of remeasurement gains, the consolidated statement of changes in net financial assets
and cash flows for the year then ended, and notes to the consolidated financial statements,
including a summary of significant accounting polices (collectively referred to as the “financial
statements”).
In our opinion, the accompanying financial statements present fairly, in all material respects, the
financial position of the Municipality as at December 31, 2025, and the results of its operations, its
remeasurement gains, changes in its net financial assets, and its cash flows for the year then
ended in accordance with Canadian public sector accounting standards (“PSAS”).
Basis for Opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards
(“Canadian GAAS”). Our responsibilities under those standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the Municipality in accordance with the ethical requirements that are relevant to
our audit of the financial statements in Canada, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our opinion.
Other Matter
The financial statements for the year ended December 31, 2024 were audited by another auditor
who expressed an unmodified opinion on those statements on July 15, 2025.
Responsibilities of Management and Those Charged with Governance for the
Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with Canadian public sector accounting standards, and for such internal control as
management determines is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
200
ON M5H 0A9
-601-6150
-601-6151
FOR DISCUSSION PURPOSES ONLY
1
In preparing the financial statements, management is responsible for assessing the Municipality’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the
Municipality or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Municipality’s financial
reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with Canadian GAAS will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with Canadian GAAS, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Municipality’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Municipality’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditor’s report to the related disclosures in the financial statements or,
if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause the Municipality to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves fair presentation.
• Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the
financial information of the entities or business units within the Municipality as a basis for
forming an opinion on the financial statements. We are responsible for the direction,
supervision and review of the audit work performed for purposes of the group audit. We remain
solely responsible for our audit opinion.
FOR DISCUSSION PURPOSES ONLY
2
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
Chartered Professional Accountants
Licensed Public Accountants
__________, 2026
FOR DISCUSSION PURPOSES ONLY
3
The Corporation of the Municipalit of Clarin ton
Consolidated Statement of Financial Position
As at December 31, 2025
2025 2024
Financial assets
Cash and cash equivalents (Note 2) $100,443,293 $105,646,870
Investments (Notes 2,5) 226,108,263 170,166,029
Accounts receivable (Note 2) 20,166,345 21,284,448
Taxes receivable (Note 6) 21,776,601 18,133,202
Inventories for resale 12,892 3,755
Inventory - surplus land 146,349 146,349
Promissory notes receivable (Note 7) -8,321,000
Investment in Elexicon Corporation (Note 8) 28,084,486 19,586,381
Total financial assets 396,738,229 343,288,034
Liabilities
Accounts payable and accrued liabilities (Note 2) 19,180,790 16,354,255
Employee future benefits liabilities (Notes 2,9) 10,294,698 10,113,440
Debenture debt (Notes 2,11) 129,120,126 80,164,952
Other long-term liabilities - Asset Retirement Obligations (Note 1) 464,209 462,416
Deferred revenue - general 23,144,385 21,297,535
Deferred revenue - obligatory reserve funds (Note 13) 89,135,436 88,351,472
Total liabilities 271,339,644 216,744,070
Net financial assets 125,398,585 126,543,964
Non-financial assets
Tangible capital assets (Note 19) (Schedule 1) 522,602,064 483,339,815
Prepaid expenses 2,089,087 2,235,181
Inventory supplies 1,182,448 1,024,337
Total non-financial assets 525,873,599 486,599,333
Accumulated surplus (Note 20) 651,272,184 613,143,297
Accumulated surplus comprised of:
Accumulated operating surplus 622,358,437 600,978,504
Accumulated remeasurement gains 28,913,747 12,164,793
Accumulated surplus $651,272,184 $613,143,297
Contingencies (Note 15) and Contractual Commitments (Note 16)
The accompanying notes are an integral part of these consolidated financial statements.
4
The Corporation of the Municipalit of Clarin ton
Consolidated Statement of Operations
For the ear ended December 31, 2025
2025
Budget
Note 22
2025
Actual
2024
Actual
Revenues
Taxation and user charges
Property taxation $ 83,339,712 $ 82,841,026 $ 77,975,507
Taxation from other governments 5,013,347 5,072,780 4,881,256
User charges 19,305,380 21,172,128 18,311,885
Grants
Government of Canada 10,500 140,203 477,810
Province of Ontario 107,481 994,213 214,638
Othe
Deferred revenue earned 24,838,801 15,881,723 12,934,534
Investment income 3,271,750 9,268,846 8,912,578
Penalty and interest on taxes 1,900,000 3,179,663 2,536,811
Fines 313,100 333,821 298,171
Donations and contribution from others 140,698 15,621,289 4,342,432
Elexicon Corporation
Equity share of net income -466,722 512,524
Contributed tangible capital assets (Note 19 (a)) 7,430,765 7,430,765 9,088,680
Other income -5,594 639,399
Loss on disposal of tangible capital assets -(59,842) (25,812)
Total revenue 145,671,534 162,348,931 141,100,413
Expenses
General government services 12,730,776 12,559,135 10,558,263
Protection services 26,768,609 26,883,768 24,392,258
Transportation services 40,100,252 42,893,150 40,741,414
Enviromental services 4,640,442 4,280,312 4,701,428
Health services 948,993 1,072,279 1,132,418
Recreation and cultural services 43,370,426 44,270,144 38,063,189
Planning and development services 9,888,748 9,010,210 8,481,765
Total expenses 138,448,246 140,968,998 128,070,735
Annual surplus 7,223,288 21,379,933 13,029,678
Accumulated surplus, be innin of ea 600,978,504 600,978,504 587,948,826
Accumulated surplus, end of ea $608,201,792 $622,358,437 $600,978,504
The accompanying notes are an integral part of these consolidated financial statements.
5
The Corporation of the Municipalit of Clarin ton
Consolidated Statement of Remeasurement Gains
For the Year Ended December 31, 2025
2025 2024
Remeasurement gains / losses $ 12,164,793 $ 828,517
Unrealized ains attributable to:
Portfolio investments 28,913,747 11,880,255
Remeasurement ains 28,913,747 11,880,255
Amounts reclassified to the consolidated statement o
operations:
Portfolio investments (12,164,793) 1,113,055
Amounts reclassified to the consolidated statement o
operations
Proportion of other comprehensive income from investment in
Elexicon Corporation
(12,164,793
-
1,113,055
-
Accumulated remeasurement ains, end of ea $ 28,913,747 $12,164,793
The accompanying notes are an integral part of these consolidated financial statements.
6
The Corporation of the Municipalit of Clarin ton
Consolidated Statement of Chan e in Net Financial Assets
For the ear ended December 31, 2025
2025 2025 2024
Budget Actual Actual
Annual surplus $ 7,223,288 $ 21,379,933 $ 13,029,678
Amortization of tangible capital assets 24,979,788 25,511,407 24,078,934
Acquisition of tangible capital assets (26,441,056) (43,486,617) (31,232,882)
Investment in assets under construction -(38,980,568) (19,777,532)
ssets under construction transferred to tan ible
capital assets -17,199,446 9,230,417
Net book value of tan ible capital assets disposals
adjustments -494,083 215,843
Decrease (increase) in prepaid expenses -146,094 (29,738)
Increase in inventory supplies -(158,111) (199,470)
Net change in remeasurement gains for the year -16,748,954 12,993,310
Increase (decrease) in net financial assets 5,762,020 (1,145,379) 8,308,560
Net financial assets, be innin of ea 126,543,964 126,543,964 118,235,404
Net financial assets, end of ea $ 132,305,984 $125,398,585 $126,543,964
The accompanying notes are an integral part of these consolidated financial statements.
7
The Corporation of the Municipalit of Clarin ton
Consolidated Statement of Cash Flows
For the ear ended December 31, 2025
2025 2024
Operatin activities
Annual surplus
Non-cash items
Amortization of tangible capital assets
Loss on disposal of tangible capital assets
Equity share of Elexicon Corporation net income
Contributed tangible capital assets recorded in revenue
Accretion expense
Change in non-cash operating items
Accounts receivable
Taxes receivable
Inventories for resale
Accounts payable and accrued liabilities
Employee future benefits liabilities
Deferred revenue - general
Deferred revenue - obligatory reserve funds
Prepaid expenses
Inventory supplies
$ 21,379,933 $ 13,029,678
25,511,407 24,078,934
59,842 25,812
(466,722) (512,524)
(7,430,765) (9,088,680)
1,793 12,509
1,118,103 (8,070,747)
(3,643,399) (5,069,154)
(9,137) 5,453
2,826,535 2,823,207
181,258 180,282
1,846,850 789,421
783,964 4,532,637
146,094 (29,738)
(158,111) (199,470)
42,147,645 22,507,620
Capital activities
Acquisition of tangible capital assets (net of contributed) (57,836,974) (32,691,317)
Proceeds on disposal of tangible capital assets 434,241 190,031
(57,402,733) (32,501,286)
Investin activities
Increase in investments (39,193,280) (3,958,835)
Elexicon equity investment change 351,196 -
Dividends (returned) received from Elexicon Corporation (61,579) 505,179
(38,903,663) (3,453,656)
Financin activities
Repayment of long term liabilities (3,794,826) (2,039,737)
Proceeds of debenture issue 52,750,000 51,867,000
48,955,174 49,827,263
Net (decrease) increase of cash and cash equivalents (5,203,577) 36,379,941
Cash and cash equivalents, beginning of year 105,646,870 69,266,929
Cash and cash equivalents, end of ear $100,443,293 $105,646,870
The accompanying notes are an integral part of these consolidated financial statements.
8
The Municipality of Clarington (the “Municipality”) is a municipality in the Province of Ontario, Canada.
It conducts its operations guided by the provisions of provincial statutes such as the Municipal Act,
the Municipal Affairs Act and related legislation.
1.Si nificant accountin policies
The consolidated financial statements of the Municipality are the representations of management
prepared in accordance with Canadian Public Sector Accounting Standards (“PSAS”).
a.Si nificant accountin policies adopted are as follows:
i.Reportin entit
These consolidated financial statements reflect financial assets, liabilities, operating
revenues and expenses, and the changes in investment in tangible capital assets of
the Municipality of Clarington. The reporting entity is comprised of all organizations,
local boards and committees controlled by the Municipality, including the following:
- Board of Mana ement for the Historic Downtown - Newcastle Arena Board
Bowmanville Business Improvement Area
- Board of Mana ement for the Newcastle Central - Newcastle Communit Hall
Business District Improvement Area Board
- Board of Mana ement for the Orono Central - Solina Hall Board
Business District Improvement Area
- Clarin ton Public Librar Board and Clarin ton - Tyrone Community Hall Board
Museums and Archives
- Bowmanville Santa Claus Parade Committee - Clarington Heritage Committee
All material inter-entity transactions and balances are eliminated on consolidation.
ii.Investment in Elexicon Corporation
The Municipality of Clarington, along with the City of Pickering, the Town of Ajax, the
City of Belleville and the Town of Whitby own Elexicon Corporation. The Municipality of
Clarington holds a 9.6433% (2024 - 9.248%) share of ownership. This share interest
changed in 2025 with the redemption of promissory notes and subsequent conversion
to newly issued common shares of Elexicon Corporation.
The Municipality’s investment in Elexicon Corporation and its subsidiaries is accounted
for on a modified equity basis, consistent with generally accepted accounting principles
as recommended by PSAS for investments in government business partnerships.
Under the modified equity basis of accounting, the business partnership’s accounting
principles are not adjusted to conform to those of the Municipality and inter-
organizational transactions and balances are not eliminated. The Municipality
recognizes its equity interest in the annual income or loss of Elexicon Corporation in its
“Consolidated Statement of Operations” with a corresponding increase or decrease in
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
9
1.Si nificant accountin policies continued
a.Si nificant accountin policies adopted are as follows: continued
ii.Investment in Elexicon Corporation continued
its investment asset account. Any dividends that the Municipality may receive from
Elexicon Corporation and other capital transactions will be reflected as adjustments in
the investment asset account.
iii.Accountin for re ion and school board transactions
The taxation and other revenues, expenses, assets and liabilities with respect to the
operations of the school boards and the Regional Municipality of Durham are not
reflected in these consolidated financial statements.
iv.Accountin for phase-in/cappin provisions
Increases/decreases in property taxes levied as a result of the application of phase-
in/capping legislation are not reflected in the Consolidated Statement of Operations but
are reported on the Consolidated Statement of Financial Position.
v.Trust funds
Trust funds and their related operations administered by the Municipality are not
included in these consolidated financial statements, but are reported separately on the
“Trust Funds Statement of Operations” and “Trust Funds Statement of Financial
Position”.
vi.Financial Instruments
Cash and cash equivalents and investments quoted in an active market are measured
at fair value. All other investments are measured at cost. Accounts receivable,
promissory notes receivable, accounts payable, and long-term debt are measured at
cost or amortized cost. The carrying amount of each of these financial instruments is
presented on the Consolidated Statement of Financial Position.
Unrealized gains and losses from changes in the fair value of financial instruments are
recognized in the Consolidated Statement of Remeasurement Gains and Losses. Upon
settlement, the cumulative gain or loss is reclassified from the Consolidated Statement
of Remeasurement Gains and Losses and recognized in the Consolidated Statement
of Operations. Interest and dividends attributable to financial instruments are reported
in the Consolidated Statement of Operations.
When investment income and realized and unrealized gains and losses from changes
in the fair value of financial instruments are externally restricted, the investment income
and fair value changes are recognized as revenue in the period in which the resources
are used for the purpose specified.
For financial instruments measured using amortized cost, the effective interest rate
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
10
1.Si nificant accountin policies continued
a.Si nificant accountin policies adopted are as follows: continued
vi.Financial Instruments continued
method is used to determine interest revenue or expense.
All financial assets are tested annually for impairment. When financial assets are
impaired, impairment losses are recorded in the Consolidated Statement of
Operations.
Transaction costs are added to the carrying value for financial instruments measured
using cost or amortized cost. Transaction costs are expensed for financial instruments
measured at fair value.
b.Basis of accountin
i.Accrual basis of accountin
Revenues and expenses are reported on the accrual basis of accounting. The accrual
basis of accounting recognizes revenues in the period in which transactions or events
occurred that gave rise to the revenues; expenses are recognized in the period the
goods and services are acquired and a liability is incurred or transfers are due.
ii.Non-financial assets
Non-financial assets are not available to discharge existing liabilities and are held for
use in the provision of services. They have useful lives extending beyond the current
year, and are not intended for sale in the ordinary course of operations. The change in
non-financial assets during the year, together with the excess of revenues over
expenses, provides the Changes in Net Financial Assets for the year.
(a)Tangible capital assets (“TCA”)
Tangible capital assets are recorded at cost, which includes all amounts that are
directly attributable to acquisition, construction, development or betterment of the
asset. The cost, less residual value, of the tangible capital assets are amortized on
a straight-line basis over their estimated useful lives as follows:
Land improvements 20-75 years
Buildings 5-75 years
Vehicles 7-20 years
Equipment 3-25 years
Linear road and related 7-75 years
Linear storm sewers 40-75 years
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
11
1.Si nificant accountin policies continued
b.Basis of accountin continued
ii.Non-financial assets continued
Amortization
The Municipality uses the straight line method of amortization. For pooled assets
and networks such as roads and storm sewers, one half of the annual amortization
is charged in the year of acquisition or in-service date and in the year of disposal.
For individual assets, if acquired (or in-service) in the first half of the year, the full
year of the amortization is charged. If acquired (or in-service) in the second half of
the year, one half of the annual amortization is charged. Similarly in the year of
disposal, if the asset is disposed of in the first half of the year, one half of the
amortization is charged but if disposed of in the second half of the year the full
annual amortization is charged. Assets under construction are not amortized until
the asset is available for productive use, at which time they are capitalized.
Contribution of tangible capital assets
Tangible capital assets received as contributions are recorded at their fair value at
the date received/assumed and that fair value is also recorded as revenue.
Works of art and historic assets
The Municipality holds various works of art and historical trasures pertaining to the
heritage and history of the Municipality. These items are not recognized as tangible
caital assets in the consolidated financial statements as a reasonable estimate of
the future benefits associated with such property cannot be made.
(b)Inventories
Inventories held for consumption are recorded at the lower of cost or replacement
cost.
iii.Reserves and reserve funds
Certain amounts, as approved by Council, are set aside in reserves and reserve funds
for future operating and capital purposes. Transfers to and/or from reserves and
reserve funds are an adjustment to the respective fund when approved. Reserves and
reserve funds form part of the Municipality’s accumulated surplus.
iv.Deferred revenues
Deferred revenues, which include advance payments for tickets, building permits and
program registration fees; contributions from developers according to Section 37 of the
Planning Act; and revenues set aside for specific purposes (obligatory reserve funds),
represent fees which have been collected, but for which the related services have not
yet been provided. Revenue is recognized when the related activity occurs or the
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
12
1.Si nificant accountin policies continued
b.Basis of accountin continued
iv.Deferred revenues continued
service is performed.
v.Emplo ee future benefits
The present value of the cost of providing employees with future benefits programs is
expensed as employees earn these entitlements through service. The cost of the
benefits earned by employees is actuarially determined using the projected benefit
method prorated on service and management’s best estimate of retirement ages of
employees and expected health care and dental costs. Actuarial gains or losses are
amortized on a straight-line basis over the expected average remaining service life of
all employees covered.
vi.Contaminated sites
Contaminated sites are the result of contamination being introduced in air, soil, water
or sediment of a chemical, organic, or radioactive material or live organism that exceed
an environmental standard. A liability for remediation of contaminated sites is
recognized when all of the following criteria are met: a) an environmental standard
exists; b) contamination exceeds the environmental standard; c) the organization is
directly responsible or accepts responsibility for the liability; d) future economic benefits
will be given up; and e) a reasonable estimate of the liability can be made. Changes in
this estimate are recorded in the Municipality’s statement of operations. As of
December 31, 2025, there was no liability recorded on the statement.
vii.Revenue reco nition
Taxation
Property tax billings are prepared by the Municipality based on assessment rolls issued
by the Municipal Property Assessment Corporation (“MPAC”). Tax rates are
established annually by Council, incorporating amounts to be raised for local services
and amounts the Municipality is required to collect on behalf of the Regional
Municipality of Durham and the Province of Ontario in respect of education taxes.
Taxes are recorded at estimated amounts when they meet the definition of an asset,
have been authorized and the taxable event occurs. For property taxes, the taxable
event is the period for which the tax is levied. As taxes recorded are initially based on
management’s best estimate of the taxes that will be received, it is possible that
changes in future conditions, such as reassessments due to audits, appeals and court
decisions, could result in a change in the amount of tax revenue recognized. Taxes
receivable are recognized net of an allowance for anticipated uncollectible amounts.
A normal part of the assessment process is the issuance of supplementary
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
13
1.Si nificant accountin policies continued
b.Basis of accountin continued
vii.Revenue reco nition continued
assessment rolls which provide updated information with respect to changes in
property assessment. Once a supplementary roll is received, the Municipality
determines the taxes applicable and renders supplementary tax billings. Assessments
of the related property taxes are subject to appeal. Any supplementary billing
adjustments made necessary by the determination of such changes will be issued /
billed as they are determined and the effect shared with the Region of Durham and
school boards, as appropriate.
Government transfers
Government transfers are recognized as revenue in the consolidated financial
statements when the transfer is authorized and any eligibility criteria are met, except to
the extent that transfer stipulations give rise to an obligation that meets the definition of
a liability. Transfers are recognized as deferred revenue when transfer stipulations give
rise to a liability. Transfer revenue is recognized in the statement of operations as the
stipulation liabilities are settled.
Government transfers and developer contributions-in-kind related to capital acquisitions
are required to be recognized as revenue in the consolidated financial statements in
the period in which the tangible capital assets are acquired.
User fees and service charges
User charges for licenses and permits are recognized when the services are
performed, good are delivered, all performance obiligations are satisfied and there is
reasonable assurance of collection. All other user fees are recognized when the
services are performed or goods are delivered and there is reasonable assurance of
collection.
Other
Other revenue is recorded when it is earned and collection is reasonably assured.
Investment income
Investment income earned on operating surplus funds and reserve funds (other than
obligatory reserve funds) are recorded as revenue in the period earned. Investment
income earned on obligatory reserve funds are recorded directly to each respective
fund balance and forms part of the deferred revenue – obligatory reserve funds
balance.
viii.Inventor for resale
Inventory for resale is valued at the lower of cost or net realizable value on an average
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
14
1.Si nificant accountin policies continued
b.Basis of accountin continued
viii.Inventor for resale continued
cost basis.
ix.Use of estimates
Since precise determination of many assets and liabilities is dependent upon future
events, the preparation of periodic financial statements necessarily involves the use of
estimates and approximations. These have been made using careful judgment. Actual
results could differ from these estimates.
x.Asset retirement obli ations
Asset retirement obligations (ARO's) are provisions for legal obligations for the
retirement of the Municipality's tangible capital assets that are either in productive use
or no longer in productive use.
An ARO liability is recognized when, as at the financial reporting date:
(a)there is a statutory, contractual, or legal obligation to incur retirement costs in
relation to a tangible capital asset;
(b)the past transaction or event giving rise to the liability has occurred;
(c)it is expected that future economic benefits will be given up; and
(d)a reasonable estimate of the amount can be made.
The Municipality recognizes asset retirement obligations in the period in which it incurs
a statutory, contractual, or legal obligation associated with the retirement of tangible
capital assets resulting from acquisition, construction, development, and or normal
operation of tangible capital assets.
The liabilities are measured initially at management’s best estimate of the discounted
future cash flows required to settle the retirement obligation. For tangible capital assets
that are still in productive use, the estimated retirement costs are capitalized and
amortized on the same basis as the related tangible capital asset. For assets that are
no longer in productive use, the liability is expensed in the period.
In subsequent periods, the liability is accreted over time. The asset retirement
obligations estimates are adjusted, if necessary, for changes in the liability estimate or
timing of the future cash flows, as applicable. Accretion expenses are included in the
Consolidated Statement of Operations. Actual costs incurred are charged against the
asset retirement obligation to the extent of the liability recorded. Differences between
actual costs incurred and the liability, if any are recognized in the Consolidated
Statement of Operations when remediation is complete.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
15
2.Financial Instruments
a.Classification
The carrying value of each class of the Municipality's financial instruments is provided in the
following tables, based on their measurement method.
Cost /2025
Amortized
Fair Value Cost Total
Cash and cash equivalents $100,443,293 $ - $ 100,443,293
Investments 95,684,588 130,423,675 226,108,263
Accounts receivable - 20,166,345 20,166,345
Promissory notes ---
Accounts payable and accrued liabilities - (19,180,790) (19,180,790)
Debenture debt - (129,120,126) (129,120,126)
Balance at the end of the ea $196,127,881 $ 2,289,104 $ 198,416,985
Cost / 2024
Amortized
Fair Value Cost Total
Cash and cash equivalents $105,646,870 $ - $105,646,870
Investments 40,196,827 129,969,202 170,166,029
Accounts receivable - 21,284,448 21,284,448
Promissory notes - 8,321,000 8,321,000
Accounts payable and accrued liabilities - (16,354,255) (16,354,255)
Debenture debt - (80,164,952) (80,164,952)
Balance at the end of the yea $145,843,697 $ 63,055,443 $208,899,140
The only financial instruments that are measured subsequent to initial recognition at fair
value are cash and cash equivalents and certain equity investments quoted in an active
market. These are fair value measurements that are derived from quoted prices (unadjusted)
in the active markets for identical assets or liabilities using the last bid price.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
16
2.Financial Instruments continued
b.Financial Instrument Fair Value Measurement
The following table provides an analysis of financial instruments that are measured at fair
value, using a fair value hierarchy of levels 1 to 3. The levels reflect the significance of the
inputs used in making the fair value measurements, as described below:
•Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities
•Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)
•Level 3 - Inputs for the asset or liability that are not based on observable market data
(unobservable inputs)
Cash and cash equivalents
Investments
Total
Level 1 Level 2 Level 3 2025 Total
$100,443,293 $ - $ - $100,443,293
95,684,588 - - 95,684,588
$196,127,881 $ - $ - $196,127,881
Cash and cash equivalents
Investments
Total
Level 1 Level 2 Level 3 2024 Total
$105,646,870 $ - $ - $105,646,870
40,196,827 - - 40,196,827
$145,843,697 $ - $ - $145,843,697
There were no transfers between Level 1 and Level 2 for the year ended December 31,
2025. There were also no transfers in or out of Level 3.
c.Financial Instrument Risk Mana ement
The Municipality is exposed to credit risk, liquidity risk, interest rate risk and other price risk
from its financial instruments. This note describes the Municipality'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 consolidated financial statements.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
17
2.Financial Instruments continued
c.Financial Instrument Risk Mana ement continued
Credit Risk
Credit risk is the risk of financial loss to the Municipality if a debtor fails to make payments of
interest and principal when due. The Municipality is exposed to this risk relating to its cash
and cash equivalents, investments, and accounts receivable. The Municipality holds its cash
accounts with federally regulated chartered banks who are insured by the Canadian Deposit
Insurance Corporation. In the event of default, the Municipality's cash accounts are insured
up to $100,000.
Accounts receivable are primarily due from the federal and provincial governments, as well
as various developers and residents. Credit risk is mitigated by the financial solvency of the
Provincial government and the highly diversified nature of the receivables.
The Municipality measures its exposure to credit risk based on how long the amounts have
been outstanding. An impairment allowance for accounts receivable of $12,000 (2024 -
$11,000) and taxes receivable of $100,000 (2024 - $100,000) is set up based on the
Municipality's historical experience regarding collections. It is management's opinion that the
Municipality is not exposed to significant credit risk.
There have been no significant changes from the previous year in the exposure to risk or
policies, procedures and methods used to measure the risk.
Market Risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will
fluctuate because of changes in market prices. Market risk comprises three types of risk:
currency risk, interest rate risk and equity risk.
There have been no significant changes from the previous year in the exposure to risk or
policies, procedures and methods used to measure the risk.
Currency Risk
Currency risk is the risk that the fair value of future cash flows of a financial instrument will
fluctuate because of changes in foreign currency rates. The Municipality is not exposed to
currency risk.
Interest Rate Risk
Interest rate risk is the potential for financial loss caused by fluctuations in fair value or future
cash flows of financial instruments because of changes in market interest rates. The
Municipality is exposed to this risk through its municipal debt and interest bearing
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
18
2.Financial Instruments continued
c.Financial Instrument Risk Mana ement continued
investments.
The Municipality holds investments which consist of guaranteed investment certificates
(GICs), fixed income securities, principal protected notes and investments managed by
Prudent Investor with varying maturities from January 2026 to November 2035 (2024 -
January 2025 to August 2034) and bearing interest rates between 1.40% and 8.45% (2024 -
0.95% to 12.0%). Investments with a maturity of less than 90 days as at the Consolidated
Statement of Financial Position date are reported within cash and cash equivalents, due to
the highly liquid nature of these investments.
The Municipality holds municipal debt with variable interest rates which involve risks of
default on interest and principal and price changes due to, without limitation, such factors as
interest rate changes and general economic conditions.
The Municipality structures its finances so as to stagger the maturities of debt, thereby
minimizing exposure to interest rate fluctuations.
There has been an increase in interest rate risk in the December 31, 2025 year end as the
amount invested in the investment portfolio increased in the year.
Equity Risk
Equity risk is the uncertainty associated with the valuation of assets arising from changes in
equity markets. The Municipality is exposed to this risk for investments measured at fair
value. Refer to note 5 for a breakdown of investments by type.
Liquidity Risk
Liquidity risk is the risk that the Municipality will encounter difficulty in meeting its obligation
associated with financial liabilities. Liquidity risk includes the risk that, as a result of
operational liquidity requirements, the Municipality will not have sufficient funds to settle a
transaction on the due date; will be forced to sell financial assets at a value, which is less
than what they are worth; or may be unable to settle or recover a financial asset. The
Municipality is exposed to this risk mainly in respect of accounts payable and accrued
liabilities and long-term debt. The Municipality's approach to managing liquidity is to ensure
as far as possible, that it will always have sufficient cash flows to fund its operations and to
meet its liabilities when due, under both normal and stressed conditions. There have not
been any changes to these risks from the prior year.
Unless otherwise noted, the expected cash outflows are within one year. The following table
sets out the contractual maturities (representing undiscounted contractual cash-flows) of
financial liabilities:
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
19
2.Financial Instruments continued
c.Financial Instrument Risk Mana ement continued
2025
Within 6 6 months to
months 1 year 1 to 5 years Over 5 years
Accounts pa able and accrued
liabilities $ 18,756,794 $ 423,997 $ - $-
Debenture debt - 6,190,263 32,087,146 90,842,717
$ 18,756,794 $ 6,614,260 $ 32,087,146 $ 90,842,717
2024Within 6 6 months to 1
months year 1 to 5 years Over 5 years
ccounts pa able and accrued
liabilities $ 16,008,759 $ 345,496 $ - $-
Debenture debt - 3,794,826 20,617,419 55,752,707
$ 16,008,759 $ 4,140,322 $ 20,617,419 $ 55,752,707
3.Trust funds
Trust funds administered by the Municipality amounting to $2,452,278 (2024 – $2,380,220) have
not been included in the “Consolidated Statement of Financial Position” nor have their financial
activities been included in the “Consolidated Statement of Operations”.
4.Operations of school boards and The Re ional Municipalit of Durham
Further to Note 1(a)(iii), requisitions were made by the Regional Municipality of Durham and
School Boards requiring the Municipality of Clarington to collect property taxes and payments in
lieu of property taxes on their behalf. The amounts levied and remitted are summarized below:
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
20
4.Operations of school boards and The Re ional Municipalit of Durham continued
School
Boards
Regional
Municipality
of Durham
2025
Property taxes $ 35,018,973 $129,307,584
Taxation from other governments 107,011 3,742,390
Total $ 35,125,984 $133,049,974
2024
Property taxes $ 34,697,695 $119,368,139
Taxation from other governments 107,011 3,446,298
Total $ 34,804,706 $122,814,437
5.Investments
Total investments consist of investments pursuant to provisions of the Municipality’s investment
policy and comprise guaranteed investment certificates (GICs), principal protected notes,
government bonds issued by various financial institutions and investments managed by Prudent
Investor. It is the Municipality’s intention to hold these investments until maturity.
2025 2024
GICs $ 10,722,953 $ 19,466,866
Principal Protected Notes 116,189,100 86,117,800
Bonds 48,298,105 52,416,570
Prudent Investments 21,984,358 -
Subtotal 197,194,516 158,001,236
Adjustment to Fair Value 28,913,747 12,164,793
Total $226,108,263 $170,166,029
The Municipality holds investments with a maturity of less than 90 days, in a High Interest Savings
Account. This value is reported within cash and cash equivalents, due to the highly liquid nature of
these investments. Total investments, with a maturity of less than 90 days, have a value of
$6,112,139 (2024 - $18,138,354) as included in cash and cash equivalents on the Consolidated
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
21
5.Investments continued
Statement of Financial Position.
6.Taxes receivable
The balance in taxes receivable, including penalties and interest, is comprised of the following:
2025 2024
Current year taxes $ 14,970,070 $ 13,224,917
Previous year taxes 6,906,531 5,008,285
21,876,601 18,233,202
Allowance for uncollectible taxes (100,000) (100,000)
$ 21,776,601 $ 18,133,202
7. Promissor notes receivable
2025 2024
Promissor note receivable from Elexicon Corporation due on
demand and bearin interest at the Ontario Ener Board
deemed lon -term debt rate on an annual basis to maturit
(4.13% for the current year). $ -$ 2,355,000
Promissor note receivable from Elexicon Ener Inc. maturin
November 1, 2039 and bearin interest at the Ontario Ener
Board deemed lon -term debt rate on a annual basis to
maturity (4.13% for the current year). -5,966,000
$ -$ 8,321,000
Elexicon Corporation and Elexicon Energy Inc promissory notes were redeemed in August of 2025
and converted to common shares. Interest revenue earned from these notes receivable totaled
$229,105 (2024 - $343,658).
8.Investment in Elexicon Corporation
a.Investment in Elexicon Corporation
The Municipality is accounting for its investment in Elexicon Corporation using a modified
equity basis in these financial statements. The financial impact to the Municipality of
Clarington's investment and equity are reported below.
The following table provides condensed supplementary financial information of Elexicon
Corporation and its subsidiaries for the year ended December 31:
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
22
The Corporation of the Municipalit of Clarin ton
Notes to the Consolidated Financial Statements
December 31, 2025
8. Investment in Elexicon Corporation continued
a.Investment in Elexicon Corporation continued
2025 2024
Financial position
Assets
Current
Capital and intangibles
Othe
Regulatory balances
$ 134,275,000
858,960,000
168,000
60,426,000
$ 124,314,000
786,041,000
701,000
53,757,000
Total assets and regulatory balances 1,053,829,000 964,813,000
Liabilities
Current
Long-term debt
Othe
134,517,000
340,341,000
232,891,000
193,653,000
283,463,000
218,555,000
Total liabilities 707,749,000 695,671,000
Shareholders' equity
Share capital
Contributed capital
Retained earnings
Regulatory balances
159,844,000
25,000
158,609,000
27,602,000
97,692,000
25,000
156,746,000
14,679,000
Total shareholders' equity and regulatory balances 346,080,000 269,142,000
Total liabilities, equity and regulatory balances 1,053,829,000 964,813,000
23
The Corporation of the Municipalit of Clarin ton
Notes to the Consolidated Financial Statements
December 31, 2025
8. Investment in Elexicon Corporation continued
a.Investment in Elexicon Corporation continued
Financial activities
Revenues
Other income
Expenses
Net movements in regulatory balances, net of tax
2025
590,295,000
12,799,000
(593,465,000)
(8,431,000)
2024
564,962,000
9,721,000
(563,200,000)
(5,941,000)
Net income for the yea $ 1,198,000 $ 5,542,000
b.Municipalit 's equit is represented b :
2025 2024
Promissory notes receivable (Note 7) $ -$ 8,321,000
Initial investment in shares of the Corporation 10,146,495 10,146,495
Investment in additional common shares of the Corporation 7,969,805 -
Accumulated net income 24,319,658 24,204,131
Net increase in value of investment 751,321 400,126
Accumulated dividends received (15,102,793) (15,164,371)
Total equity 28,084,486 27,907,381
Municipality of Clarington's investment represented by:
Investment in Corporation 28,084,486 19,586,381
Promissory notes receivable -8,321,000
$ 28,084,486 $ 27,907,381
c.Contin encies and uarantees of Elexicon Corporation the “Corporation” as
disclosed in their financial statements are as follows:
(i)Insurance claims
The Corporation is a member of the Municipal Electric Association Reciprocal Insurance
Exchange (“MEARIE”) which was created on January 1, 1987. A reciprocal insurance
exchange may be defined as a group of persons formed for the purpose of exchanging
reciprocal contracts of indemnity or inter-insurance with each other. MEARIE provides
general liability insurance to member electric utilities. MEARIE also provides vehicle and
property insurance to the Corporation.
24
8.Investment in Elexicon Corporation continued
c.Contin encies and uarantees of Elexicon Corporation the “Corporation” as
disclosed in their financial statements are as follows: continued
Insurance premiums charged to each member electric utility consist of a levy per $1,000
of service revenue subject to a credit or surcharge based on each electric utility’s claims
experience.
(ii)Contractual obligation - Hydro One Networks Inc.
The Corporation's subsidiary, Elexicon Energy Inc. (EE), is party to a connection and cost
recovery agreement with Hydro One related to the construction by Hydro One of a
transformer station designated to meet EE's anticipated electricity load growth.
Construction of the project was completed during 2007 and EE connected to the
transformer station during 2008.
To the extent that the cost of the project is not recoverable from future transformation
connection revenues, EE is obliged to pay a capital contribution equal to the difference
between these revenues and the construction costs allocated to EE. The construction
costs allocated to EE for the project are $19,950,000.
Hydro One has performed a final true-up in 2024 based on actual load at the end of the
fifteenth anniversary of the in-service date. The shortfall of connection transformation
revenue for Hydro One resulted in an accrual recorded in 2024 of $4,062,000 and EE
recognized this amount as an intangible asset. The final true-up payment was made in
January 2025 and there is no further obligation with respect to this agreement.
d.Lease commitments - Elexicon Corporation
Future minimum non-cancellable lease payment obligations under finance leases are as
follows:
2026 $ 71,000
2027 44,000
$ 115,000
9.Emplo ee future benefits liabilities
a.Accumulated sick leave entitlement
(i)Firefighters
The Municipality provides two sick leave accumulation plans for firefighters. Plan A
accumulates at the rate of one day per month of completed years of service to a
maximum of 182 days. These employees may become entitled to a cash payment on
retirement, early retirement, termination or death, at the rate of 50% of the accumulated
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
25
9.Emplo ee future benefits liabilities continued
a.Accumulated sick leave entitlement continued
credit, to a maximum of one-half a year’s salary. Plan B accumulates at the rate of one
day per month once the employees complete five years of service. The estimated liability
at December 31, 2025 was $1,578,122 (2024 - $1,405,844) and is included in the
Consolidated Statement of Financial Position in the Employee future benefits liabilties.
(ii)Other
During the 1993 fiscal year, the Municipality negotiated an agreement with all employees
(except firefighters) to terminate the sick leave benefit plan which had been in effect for
many years. The Municipality agreed to pay to those employees covered by the plan and
who had at least five-years’ service with the Municipality a cash equivalent of 50% of sick
leave days accumulated to July 1, 1993 to a maximum of 120 days of salary.
Remuneration for the buying out of sick days identified will be available to the employee
at any time up to the time that the employee either leaves the Corporation or retires, at
the rate of remuneration in effect at July 31, 1993. The estimated liability at December
31, 2025 amounted to $12,911 (2024 - $15,405) and is included in the Consolidated
Statement of Financial Position in the Employee future benefits liabilities.
b.Post-emplo ment benefits - othe
The Municipality makes available to qualifying employees who retire before the age of 65
(firefighters - age 60) the opportunity of continuing their coverage for benefits such as
medical (extended health), dental, and life insurance benefits. Coverage ceases at age 65.
Dependent upon the eligibility, the cost of this coverage may be a shared responsibility
between the Municipality and the retired employees.
An actuarial valuation was performed as at December 31, 2025 based on data as at the
valuation date and plan provisions. The accrued benefit obligation and net benefit costs (i.e.
the expense) for the 2025 fiscal year end was determined by this valuation.
The significant actuarial assumptions employed for the valuation are as follows:
(i)Discount rate will be 4.10% per annum, raising to 4.30% in 2026.
(ii)Future inflation rates will be 3.75% for 2026, and 3.25% thereafter
(iii)Dental cost trend rates will be 3.30% in fiscal 2025 and will increase to 4.0% for
2027 through 2030.
(iv)Extended health care trend rates will be 6.58% in fiscal 2025; and remain stable
at that level through to 2030.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
26
9.Emplo ee future benefits liabilities continued
c.Information about the Municipalit ’s emplo ee future benefits liabilities is as follows:
2025 2024
Accrued benefit obli ation
Balance, beginning of yea $ 8,477,448 $ 8,314,232
Employer current service cost 532,862 511,874
Interest cost 355,260 345,967
Benefits paid (529,038) (533,140)
Actuarial (gain) loss (488,749) (161,485)
Balance, end of yea 8,347,783 8,477,448
Unamortized net actuarial gains 1,946,915 1,635,992
Emplo ee future benefits liabilities, end of ea $ 10,294,698 $ 10,113,440
2025 2024
Post retirement non-pension benefits $ 8,384,439 $ 8,379,213
Retiree cash bonus benefits 147,727 131,787
Sick leave entitlement benefits 1,591,033 1,421,249
Council severance benefits 169,499 181,191
Emplo ee future benefits liabilities, end of ea $ 10,292,698 $ 10,113,440
10.Pension a reements
The Municipality makes contributions to the Ontario Municipal Employees Retirement Fund
(“OMERS”). OMERS is a multi-employer defined benefit pension plan which provides pensions for
employees of Ontario municipalities, local boards, public utilities and school boards. The pension
plan is financed by equal contributions from participating employers and employees, and by the
investment earnings of the fund. The most recent actuarial valuation of the Plan was conducted at
December 31, 2025. The results of this valuation disclosed total going concern actuarial obligations
of $151,365 million with respect to benefits accrued for service with actuarial net assets at that
date of $150,043 million indicating an actuarial deficit of $1,322 million. Because OMERS is a
multi-employer plan, any Plan surpluses or deficits are the joint responsibility of Ontario municipal
organizations and their employees. As a result the Municipality does not recognize any share of
the Plan surplus or deficit.
The Municipality recognizes the expense related to this plan as contributions are made. The
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
27
10.Pension a reements continued
contribution rates and year's maximum pensionable earnings (YMPE) are outlined in the table
below.
Yea YMPE
NRA 65 up
to YMPE
NRA 65 up
to YMPE
NRA 60 up
to YMPE
NRA 60
over YMPE
2025 $ 71,300 9.00 % 14.60 % 9.20 % 15.80 %
2024 $ 71,300 9.00 % 14.60 % 9.20 % 15.80 %
The amount contributed to OMERS for 2025 was $5,553,830 (2024 – $4,516,416) for current
services and is included as an expense on the Consolidated Statement of Operations.
11.Debenture Debt
The debenture debt consists of several debentures that mature in the years 2029 to 2045. In 2025,
the Municipality, through the Region of Durham, entered into a sinking fund debenture valued at
$47,750,000. As at December 31, 2025, the Municipality and Region have not made any
contributions towards the principal amount of this sinking fund debenture.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
28
11.Debenture Debt continued
a.Debenture debt details
At the end of the year, the outstanding principal amount of this liability is $129,120,126
(2024 - $80,164,952).
Maturity Date Interest Rate %1
Regional
By-law # 2025 2024
July 2, 2029 1.25 to 2.80 38-2014 $ 1,997,600 $ 2,460,600
October 17, 2031 1.70 to 3.30 48-2016 430,000 496,000
April 13, 2032 1.70 to 3.30 56-2017 520,122 586,182
April 13, 2032 1.70 to 3.30 56-2017 667,404 752,170
July 5, 2042 3.35 to 4.30 32-2022 18,009,000 18,698,000
July 5, 2032 3.70 to 4.60 32-2022 4,727,000 5,305,000
October 25, 2044 3.40 to 4.60 2024-044 38,568,000 40,000,000
October 25, 2044 3.40 to 4.60 2024-044 591,000 650,000
October 25, 2044 3.40 to 4.60 2024-044 3,100,000 3,217,000
October 25, 2044 3.40 to 4.60 2024-044 7,760,000 8,000,000
June 27, 2045 2.75 to 4.70 2025-023 5,000,000 -
October 25, 2044 -
Sinking Fund 3.75 2025-039 47,750,000 -
129,120,126 80,164,952
Less: sinking fund assets --
Less: value of Re ion
sinking fund deposits --
Total debenture debt $129,120,126 $ 80,164,952
1 Interest rates gradually increase to the upper limits noted in the table.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
29
11.Debenture Debt continued
b.Principal pa ments
Of the municipal debt reported in (a) of this note, principal payments are payable from
general municipal revenues as follows:
Debenture
Payments
Sinking Fund
Deposits
Total Principal
Payments
2026 $ 4,124,915 $ 2,065,348 $ 6,190,263
2027 4,263,458 2,065,348 6,328,806
2028 4,409,001 2,065,348 6,474,349
2029 4,559,598 2,065,348 6,624,946
2030 4,186,449 2,065,348 6,251,797
Thereafte 59,826,705 37,423,260 97,249,965
$ 81,370,126 $ 47,750,000 $ 129,120,126
c.Principal and interest
The annual principal and interest payments required to service these liabilities are within the
annual debt repayment limit prescribed by the Ministry of Municipal Affairs and Housing.
Principal payments include sinking fund contributions. To date, $nil of contributions were
made related to the sinking fund debenture.
d.Interest expense
Total interest expense related to the debenture debt amounted to $3,705,235 (2024 -
$1,660,494) and is reported on the Consolidated Statement of Operations.
12.Internal Loans
As a means of funding various capital acquisitions, funds are borrowed from the Municipal Capital
Reserve Fund. These funds are secured by promissory notes with interest rates ranging from
2.20% to 3.30% and payment terms of 15 years. The financing arrangements and ultimate
repayment are approved by Council through the budget process.
a.The followin is a summar of the individual loans:
Major Parking Lot Rehabilitation $ 1,030,031
LED Street lighting Conversion 1,530,969
$ 2,561,000
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
30
12.Internal Loans continued
b.Of the internal loans reported in a of this note, principal pa ments are as follows:
2026 $ 287,000
2027 296,000
2028 304,000
2029 314,000
2030 324,000
Thereafte 1,036,000
$ 2,561,000
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
31
13.Deferred revenue - obli ator reserve funds
The continuity of “deferred revenue - obligatory reserve funds” of the Municipality is summarized
as follows:
2025 2024
Balance, beginning of yea $ 88,351,472 $ 83,818,835
Contributions:
Contributions from developers 7,635,555 4,533,465
Investment Income 5,708,385 6,345,996
Canada community-building 3,321,747 3,234,339
Provincial infrastructure -3,353,372
16,665,687 17,467,172
Utilization:
Transfer to operating 2,635,981 3,554,483
Acquisition of TCA - construction 13,245,742 9,380,051
15,881,723 12,934,534
Change in deferred revenue during the yea 783,964 4,532,637
Balance, end of yea 89,135,436 88,351,472
Balance, end of year - analyzed as follows:
Parkland cash-in-lieu 10,309,036 9,251,640
Canada community-building 5,340,929 3,821,009
Building code act (1) -(2,448,667)
Provincial infrastructure 6,474,853 9,630,972
Development charges (Note 14) 67,010,618 68,096,518
Total deferred revenue – obligatory reserve funds $ 89,135,436 $ 88,351,472
(1)Building Division expenditures have exceeded revenues for fiscal 2025 ($1,691,711) and 2024
($2,448,667), due to the cyclical nature of building permit activities. In 2025, the total deficit of
$4,140,378 was offset by a transfer from the Rate Stabilization reserve fund. The Rate
Stabilization reserve fund will be replenished in future years, when building permit revenues
exceed expenditures.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
32
The Corporation of the Municipalit of Clarin ton
Notes to the Consolidated Financial Statements
December 31, 2025
14. Continuit of development char es reserve funds
2025 2024
Balance at the beginning of the yea $ 68,096,518 $ 64,217,390
Development charges collections 6,911,605 4,975,087
Investment income 5,004,807 5,623,697
Tangible capital assets acquisitions and construction (7,917,664) (4,620,206)
Operating expenses (incl debenture payments) (5,084,648) (2,099,450)
Balance at the end of the yea $ 67,010,618 $ 68,096,518
15.Contin encies
Various legal actions and claims have been initiated by and against the Municipality, the outcomes
of which cannot be determined at the time of reporting. Accordingly, no provision has been made in
these consolidated financial statements for any liability which may result. Should any gain or loss
occur as a result of the above legal actions the Municipality will account for the gain/loss when it is
likely that such a gain/loss will occur and the amount is measurable.
16.Contractual commitments
During the year the Municipality had work done on several major projects with contract values
totaling approximately $13,825,262 (2024 - $23,669,084). These contracts relate to the
construction and expansion of certain permanent facilities. As at December 31, 2025, $51,266,433
(2024 - $3,000,121) relating to these contracts had not been expended.
17.Related part transactions and balances - Elexicon Corporation
The Municipality's investment in Elexicon Corporation is accounted for on a modified equity basis.
Transactions of a non-investment nature are recorded at cost.
2025 2024
Transactions
Dividends (returned) received
Interest earned on promissory notes
Property taxes
Energy and services purchases
$ (61,579) $
229,105
40,110
738,265
505,179
343,658
36,607
670,152
Balances
Promissory notes receivable
Accounts payable and accrued liabilities $
-
57,882 $
8,321,000
54,010
33
18.Guarantees
In the normal course of business, the Municipality enters into agreements which contain
guarantees. The Municipality’s primary guarantees are as follows:
(i)The Municipality has provided indemnities under lease agreements for the use of various
facilities or land. Under the terms of these agreements the Municipality agrees to indemnify the
counterparties for various items including, but not limited to, all liabilities, losses, suits, and
damages arising during, on or after the term of the agreement. The maximum amount of any
potential future payment cannot be reasonably estimated.
(ii)The Municipality indemnifies employees and elected officials for various items including, but not
limited to, all costs to settle suits or actions due to association with the Municipality, subject to
certain restrictions. The Municipality has purchased liability insurance to mitigate the cost of any
potential future suits or actions. The term of the indemnification is not explicitly defined, but is
limited to the period over which the indemnified party served as an employee or elected official
of the Municipality. The maximum amount of any potential future payment cannot be
reasonably estimated.
(iii) The Municipality has entered into agreements that may include indemnities in favour of third
parties, such as purchase and sale agreements, confidentiality agreements, engagement letters
with advisors and consultants, outsourcing agreements, leasing contracts, information
technology agreements and service agreements. These indemnification agreements may
require the Municipality to compensate counterparties for losses incurred by the counterparties
as a result of breaches in representation and regulations or as a result of litigation claims or
statutory sanctions that may be suffered by the counterparty as a consequence of the
transaction. The terms of these indemnities are not explicitly defined and the maximum amount
of any potential reimbursement cannot be reasonably estimated.
The nature of these indemnification agreements prevents the Municipality from making a
reasonable estimate of the maximum exposure due to the difficulties in assessing the amount of
liability which stems from the unpredictability of future events and the unlimited coverage offered to
counterparties. Historically, the Municipality has not made any significant payments under such or
similar indemnification agreements and therefore no amount has been accrued in these
consolidated financial statements with respect to these agreements.
19.Tan ible capital assets
The continuity of the historical cost and accumulated amortization for various categories of tangible
capital assets can be found in Schedule 1.
Further information relating to tangible capital assets is as follows:
a.Contributed tan ible capital assets
The Municipality of Clarington records all tangible assets contributed by an external party at
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
34
19.Tan ible capital assets continued
a.Contributed tan ible capital assets continued
fair value on the earlier of the date received or of the transfer of risk and responsibility.
Typical examples are roadways, parks, land, and storm sewer lines installed by a developer
as part of a subdivision agreement. For subdivision assets, the recorded date is considered
to be the date of acceptance with the exclusion of streetlights with the recorded date as the
date of completion. In 2025, there were contributed assets of $7,430,765 (2024 -
$9,088,680).
b.Works of Art and Historical Treasures
The Municipality has one historical collection. The Clarington Museums and Archives
collection is currently insured for $287,800. Also included in historical treasures are the
cenotaphs located in Bowmanville, Newcastle, Orono and Newtonville. Due to the rural
history, there are several abandoned cemeteries located throughout the Municipality. All
associated physical items, including historical signs and cairns, or concrete structures build
for old headstones, are considered a historical treasure.
20.Accumulated surplus
Accumulated surplus is comprised of the following:
2025 2024
Tangible capital assets $ 522,602,064 $ 483,339,815
General surplus 30,754,117 3,521,819
Capital surplus 131,663,037 96,796,437
Inventory - surplus land 146,349 146,349
Debenture debt (129,120,126) (80,164,952)
Over Unfunded emplo ee benefits and post-emplo ment
liabilities 973,212 (4,614)
Other long-term liabilities - ARO (464,209) (462,416)
Accumulated remeasurement gains 28,913,747 (12,993,310)
Reserves set aside for specific purposes b Council:
Acquisition of capital assets reserves 9,557,937 10,060,101
Legal / consulting 3,223,152 3,240,304
Election expenses 516,965 391,965
Fire prevention 305,489 305,489
Burketon park improvements 7,569 7,569
Samuel Wilmot nature area 7,166 3,373
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
35
20.Accumulated surplus continued
2025 2024
Secondary plans 8,101 24,093
Clarington Heritage committee board 13,762 12,262
Library and Museum 615,678 1,580,406
Reserve funds set aside for specific purposes b Council:
General municipal purposes 5,676,290 7,459,135
Rate stabilization 4,957,409 13,750,978
Strategic capital 8,928,764 8,753,953
Parks and cemeteries 4,365,606 836,751
Debenture repayment 971,687 940,489
Economic development 998,983 683,111
Other cultural -38,508
Acquisition of capital assets reserve funds 8,873,787 6,484,077
Transportation Infrastructure 637,982 5,995
Miscellaneous capital 9,099,570 8,608,758
Engineering, bridges & culverts 2,975,281 2,898,375
Climate Action 322,074 184,104
Port Granby 347,166 336,016
Community improvement plan 3,312,071 2,204,883
Business improvement areas 133,962 129,680
Cemetery perpetual care -149,818
Community emergency management 776,804 880,661
Equity in Elexicon Corporation 28,084,486 27,835,212
Accumulated surplus $ 651,272,184 $ 613,143,297
21.Se mented information
The Municipality provides a wide range of services to its residents. Distinguishable functional
segments have been separately reported on Schedule 2. For each segment, revenues and
expenses represent amounts that are directly attributable to each segment. Tax revenues are
reported as part of general government.
The nature of the segments and the activities they encompass are as follows:
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
36
21.Se mented information continued
a.General overnment services
General government is comprised of all departments that support the corporate governance,
management and program support for the Municipality.
b.Protection services
Protection services includes protection to persons and property and is comprised of
Emergency and Fire Services, Municipal Law Enforcement, Animal Services and Building
Inspection / Enforcement services. Emergency and Fire Services includes responsibility for
emergency management, fire prevention and public education, fire suppression,
communication, and training.
c.Transportation services
Transportation services includes services provided by the Public Works department. The
primary responsibilities include the inspection, planning and maintenance of the roads,
bridges, sidewalks, streetlights, roadsides, winter snow clearing, subdivision planning, traffic
engineering, development, and municipal servicing reviews. Other services include fleet
maintenance, parking and school crossing guards.
d.Environmental services
Environmental services includes storm-water management, erosion control and resale of
waste diversion goods.
e.Health services
Health services includes the maintenance and operation of the Municipality’s active and
abandoned cemeteries and crematorium, cemetery records management and the sale of
cemetery plots, permits and headstones.
f.Recreation and cultural services
Recreation and cultural services includes the administration, operation and maintenance of
all recreational, aquatic, arena, community recreational facilities, parks and trails. Clarington
Libraries, Museums and other external cultural agencies are also included in this segment.
g.Plannin and development services
Planning and development services includes the development of planning policies, urban
design, development approvals, heritage preservation, real estate services and geomatics.
This segment further includes business improvement areas and tourism activities.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
37
22.Bud et amounts
The 2025 budgeted adopted by Council was prepared using the traditional fund accounting basis,
whereas the financial statements are prepared on a full accrual basis. As a result, the approved
2025 budget figures have been adjusted to align with full accrual accounting for financial reporting
purposes. These adjustments include recognizing amortization of tangible capital assets and other
capital-related items, removing transfers to and from reserves and reserve funds, and
incorporating post-employment benefit expenses. A reconciliation of the originally adopted budget
to the figures presented in the consolidated financial statements is provided below.
Bud et Consolidated Bud et
adopted b
Council
entities
adjustments
PSAB
Adjustments
presented in
statements
Taxation $ 88,353,059 $ -$-$ 88,353,059
User charges 18,744,658 560,722 -19,305,380
Grants 113,981 4,000 -117,981
Other revenues 28,259,702 95,207 2,109,440 30,464,349
Contributed TCA --7,430,765 7,430,765
Total revenue 135,471,400 659,929 9,540,205 145,671,534
General government 38,407,999 -(25,677,223) 12,730,776
Protection 22,699,237 -4,069,372 26,768,609
Transportation 20,656,718 -19,443,534 40,100,252
Environmental 2,530,000 -2,110,442 4,640,442
Health 759,893 -189,100 948,993
Recreation & cultural 41,848,122 568,661 953,643 43,370,426
Planning & development 8,569,431 115,272 1,204,045 9,888,748
Total expenses 135,471,400 683,933 2,292,913 138,448,246
Annual surplus $ -$24,004 $ 7,247,292 $ 7,223,288
23. Comparative fi ures
Certain comparative figures have been reclassified to conform to the financial statement
presentation adopted in the current year.
The Corporation of the Municipality of Clarington
Notes to the Consolidated Financial Statements
December 31, 2025
38
The Corporation of the Municipalit of Clarin ton
Consolidated Schedule of Tan ible Capital Assets - Schedule 1
For the Year Ended December 31, 2025
2025
General Infrastructure
Land Linear Road Linear Storm Assets under
Land Improvements Buildings Vehicles Equipment Land & Related Sewers Buildings Vehicles Equipment construction Total
Cost
Balance, be innin
of year (note 23) $ 72,823,374 $ 53,321,753 $118,380,784 $ 10,436,805 $ 16,935,910 $ 15,074,254 $445,103,425 $104,051,594 $ 2,510,405 $ 16,922,068 $ 480,648 $ 26,983,361 $883,024,381
Add: additions
during the yea -4,054,432 11,889,548 3,322,776 1,172,576 1,661,900 12,495,599 1,833,185 108,486 6,816,672 120,318 38,980,568 82,456,060
Less: disposals
during the yea -(83,754) (573,724) (582,520) (806,634) - (2,061,404) -- (1,762,535) - (17,199,446) (23,070,017)
Balance, end of yea 72,823,374 57,292,431 129,696,608 13,177,061 17,301,852 16,736,154 455,537,620 105,884,779 2,618,891 21,976,205 600,966 48,764,483 942,410,424
Accumulated
amortization
Balance, be innin
of yea - 20,373,193 64,266,010 7,590,255 10,705,276 - 257,681,641 27,069,563 1,861,421 9,996,784 140,423 -399,684,566
Add: amortization
during the yea -1,807,049 3,692,851 838,276 1,392,183 - 14,659,919 1,403,824 63,468 1,589,545 64,292 -25,511,407
Less: accumulated
amortization on
disposals -(52,814) (328,888) (582,520) (792,610) - (1,868,246) -- (1,762,535) --(5,387,613)
Balance, end of yea -22,127,428 67,629,973 7,846,011 11,304,849 - 270,473,314 28,473,387 1,924,889 9,823,794 204,715 -419,808,360
Net book value o
tan ible capital
assets $ 72,823,374 $ 35,165,003 $ 62,066,635 $ 5,331,050 $ 5,997,003 $ 16,736,154 $185,064,306 $ 77,411,392 $ 694,002 $ 12,152,411 $ 396,251 $ 48,764,483 $522,602,064
39
The Corporation of the Municipalit of Clarin ton
Consolidated Schedule of Tan ible Capital Assets - Schedule 1
For the Year Ended December 31, 2025
2024
General Infrastructure
Land Linear Road Linear Storm Assets under
Land Improvements Buildings Vehicles Equipment Land & Realated Sewers Buildings Vehicles Equipment construction
Total Cost
Balance, be innin
of yea $ 72,823,374 $ 47,987,193 $113,436,785 $ 9,796,389 $ 16,200,670 $ 9,448,254 $437,788,911 $102,632,133 $ 2,510,405 $ 17,881,727 $ 358,577 $ 16,436,245 $847,300,663
Add: additions
during the yea -5,502,891 5,766,435 943,710 1,668,524 5,626,000 9,067,297 1,419,461 - 1,121,491 122,071 19,777,533 51,015,413
Less: disposals
during the yea -(168,331) (822,436) (486,731) (933,284) - (1,752,783) -- (1,897,713) - (9,230,417) (15,291,695)
Balance, end of yea 72,823,374 53,321,753 118,380,784 10,253,368 16,935,910 15,074,254 445,103,425 104,051,594 2,510,405 17,105,505 480,648 26,983,361 883,024,381
Accumulated
amortization
Balance, be innin
of yea - 18,920,560 61,620,810 7,397,468 10,273,847 - 244,881,085 25,688,128 1,776,797 10,795,019 92,354 -381,446,068
Add: amortization
during the yea -1,620,964 3,430,305 635,775 1,364,713 - 14,376,551 1,381,435 84,624 1,136,498 48,069 -24,078,934
Less: accumulated
amortization on
disposals -(168,331) (785,105) (486,731) (933,284) - (1,575,995) -- (1,890,990) --(5,840,436)
Balance, end of yea - 20,373,193 64,266,010 7,546,512 10,705,276 - 257,681,641 27,069,563 1,861,421 10,040,527 140,423 -399,684,566
Net book value o
tan ible capital
assets $ 72,823,374 $ 32,948,560 $ 54,114,774 $ 2,706,856 $ 6,230,634 $ 15,074,254 $187,421,784 $ 76,982,031 $ 648,984 $ 7,064,978 $ 340,225 $ 26,983,361 $483,339,815
40
The Corporation of the Municipalit of Clarin ton
Consolidated Schedule of Se mented Information - Schedule 2
For the Year Ended December 31, 2025
2025
General
overnment
services
Protection
services
Transportation
services
Environmental
services
Recreation and
Health services cultural services
Plannin and
development Consolidated
Operatin revenue
Taxation and user charges
Grants
Othe
Elexicon Corporation
Contributed tangible capital assets
Other income
Loss on disposal of tangible capital assets
$ 90,657,870 $
56,033
26,636,168
466,722
-
2,590
1,999
1,368,693 $
64,014
450,966
-
-
-
-
6,683,799 $
(25,378)
10,395,403
-
4,524,781
1,415
243,700
175,704 $
51,813
-
-
1,415,984
-
-
375,772 $
-
65,096
-
-
-
-
7,292,841 $
553,184
6,565,784
-
1,490,000
62
(305,541)
2,531,255 $
434,750
171,925
-
-
1,527
-
109,085,934
1,134,416
44,285,342
466,722
7,430,765
5,594
(59,842)
Total operatin revenue 117,821,382 1,883,673 21,823,720 1,643,501 440,868 15,596,330 3,139,457 162,348,931
Operatin expenses
Salaries and wages
Operating materials and supplies
Contract services
Rent and financial expenses
External transfers to others
Amortization expense
Interest on long-term liabilities
8,658,207
769,501
1,557,823
234,393
-
1,316,388
22,823
23,116,647
1,602,719
1,073,762
-
-
1,090,640
-
11,869,641
10,664,220
3,541,061
12,204
-
16,335,004
471,020
696,325
1,151,635
623,540
-
-
1,808,812
-
560,849
442,707
-
-
-
68,723
-
23,732,431
7,858,254
3,236,232
123,376
1,186,478
4,833,995
3,299,378
6,772,513
490,209
1,689,643
-
-
57,845
-
75,406,613
22,979,245
11,722,061
369,973
1,186,478
25,511,407
3,793,221
Total operatin expenses 12,559,135 26,883,768 42,893,150 4,280,312 1,072,279 44,270,144 9,010,210 140,968,998
Annual surplus deficit $ 105,262,247 $ 25,000,095 $ 21,069,430 $ 2,636,811 $ 631,411 $ 28,673,814 $ 5,870,753 $ 21,379,933
41
The Corporation of the Municipalit of Clarin ton
Consolidated Schedule of Se mented Information - Schedule 2
For the Year Ended December 31, 2025
2024
General
overnment
services
Protection
services
Transportation
services
Environmental
services
Recreation and
Health services cultural services
Plannin and
development Consolidated
Operatin revenue
Taxation and user charges
Grants
Othe
Elexicon Corporation
Contributed tangible capital assets
Other income
Loss on disposal of tangible capital assets
$ 83,671,952 $
41,906
11,342,195
512,524
-
994
7,516
1,244,922 $
-
3,353,874
-
-
-
-
5,660,407 $
344,909
9,989,127
-
2,355,332
9,905
3,924
139,328 $
-
2,679
-
1,107,348
-
-
474,117 $
-
133,374
-
-
-
-
6,906,084 $
318,133
3,912,260
-
5,626,000
-
(37,252)
3,071,838 $
(12,500)
291,017
-
-
628,500
-
101,168,648
692,448
29,024,526
512,524
9,088,680
639,399
(25,812)
Total operatin revenue
Operatin expenses
Salaries and wages
Operating materials and supplies
Contract services
Rent and financial expenses
External transfers to others
Amortization expense
Interest on long-term liabilities
95,577,087
7,084,749
791,886
1,276,466
192,269
-
1,187,802
25,091
4,598,796
20,849,909
1,245,087
1,243,363
-
-
1,053,899
-
18,363,604
10,399,607
7,497,743
7,071,595
13,615
-
15,566,055
192,799
1,249,355
726,205
1,419,864
775,674
-
-
1,779,685
-
607,491
491,999
588,071
-
-
-
52,348
-
16,725,225
19,619,843
7,616,138
3,754,665
147,523
1,036,941
4,388,088
1,499,991
3,978,855
6,394,917
461,497
1,574,294
-
-
51,057
-
141,100,413
65,567,229
19,620,286
15,696,057
353,407
1,036,941
24,078,934
1,717,881
Total operatin expenses
Annual surplus deficit $
10,558,263
85,018,824 $
24,392,258
19,793,462 $
40,741,414
22,377,810 $
4,701,428
3,452,073 $
1,132,418
524,927 $
38,063,189
21,337,964 $
8,481,765
4,502,910 $
128,070,735
13,029,678
42
The Corporation of the Municipalit of Clarin ton
Consolidated Schedule of Se mented Information - Schedule 3
For the Year Ended December 31, 2025
2025 - Budget
General
overnment
services
Protection
services
Transportation
services
Environmental
services Health services
Recreation and
cultural services
Plannin and
development Consolidated
Operatin revenue
Taxation and user charges
Grants
Othe
Contributed tangible capital assets
$ 88,952,359 $
-
5,102,600
-
2,609,400 $
-
1,531,684
-
6,357,550 $
-
18,066,962
4,524,781
154,300 $
-
-
1,415,984
382,600 $
-
-
-
6,781,660 $
113,981
5,688,646
1,490,000
2,420,570 $
4,000
74,457
-
107,658,439
117,981
30,464,349
7,430,765
Total operatin revenue 94,054,959 4,141,084 28,949,293 1,570,284 382,600 14,074,287 2,499,027 145,671,534
Operatin expenses
Salaries and wages
Operating materials and supplies
Contract services
Rent and financial expenses
External transfers to others
Amortization expense
Interest on long-term liabilities
9,733,647
851,042
698,195
234,900
-
1,189,644
23,348
22,733,779
1,493,196
1,445,738
-
-
1,095,896
-
11,149,102
9,207,820
3,275,575
11,335
-
16,279,222
177,198
533,071
1,272,123
1,062,740
-
-
1,772,508
-
497,164
432,512
-
-
-
19,317
-
22,291,577
7,858,187
4,126,560
131,308
1,152,356
4,578,549
3,231,889
7,885,039
689,200
1,269,857
-
-
44,652
-
74,823,379
21,804,080
11,878,665
377,543
1,152,356
24,979,788
3,432,435
Total operatin expense 12,730,776 26,768,609 40,100,252 4,640,442 948,993 43,370,426 9,888,748 138,448,246
Annual surplus deficit $ 81,324,183 $ 22,627,525 $ 11,150,959 $ 3,070,158 $ 566,393 $ 29,296,139 $ 7,389,721 $ 7,223,288
43
The Corporation of the Municipalit of Clarin ton
Consolidated Schedule of Se mented Information - Schedule 3
For the Year Ended December 31, 2025
2024 - Budget
General
overnment
services
Protection
services
Transportation
services
Environmental
services Health services
Recreation and
cultural services
Plannin and
development Consolidated
Operatin revenue
Taxation and user charges
Grants
Othe
Contributed tangible capital assets
Other Income
$ 83,537,052 $
-
4,102,800
-
-
2,503,200 $
-
807,911
-
-
781,500 $
-
7,683,550
2,355,332
5,054,750
154,300 $
-
-
1,107,348
-
382,600 $
-
-
-
-
6,198,270 $
113,981
1,643,214
5,626,000
-
2,470,970 $
-
63,000
-
-
96,027,892
113,981
14,300,475
9,088,680
5,054,750
Total operatin revenue 87,639,852 3,311,111 15,875,132 1,261,648 382,600 13,581,465 2,533,970 124,585,778
Operatin expenses
Salaries and wages
Operating materials and supplies
Contracted services
Rent and financial expenses
Enternal transfers to others
Amortization expense
Interest on long-term liabilities
7,261,958
909,123
792,975
162,300
-
1,189,644
25,574
20,129,219
1,178,300
1,458,087
-
-
1,095,896
-
11,162,589
7,193,418
7,633,035
11,374
-
16,279,222
200,240
545,632
1,148,234
1,048,267
-
-
1,772,508
-
481,289
508,341
-
-
-
19,317
-
19,138,698
8,107,937
3,713,361
127,726
1,044,519
4,578,549
1,127,472
7,826,129
618,613
1,067,061
-
-
44,652
-
66,545,514
19,663,966
15,712,786
301,400
1,044,519
24,979,788
1,353,286
Total operatin expense 10,341,574 23,861,502 42,479,878 4,514,641 1,008,947 37,838,262 9,556,455 129,601,259
Annual surplus deficit $ 77,298,278 $ 20,550,391 $ 26,604,746 $ 3,252,993 $ 626,347 $ 24,256,797 $ 7,022,485 $ 5,015,481
44
Statement of Operations - Library
Supplementary Schedule
for the year ended December 31, 2025
2025 2024
Actual Actual
(Note 23)
$ $
Revenues
Municipality of Clarington operating grant 4,617,291 3,989,337
Province of Ontario grant 107,111 125,911
Government of Canada grant 20,191 -
Grants from others 24,498 -
Fines, fees, sales, discards 50,037 44,142
Donations and bequests 16,126 8,008
Interest 136,349 184,678
Miscellaneous 40,815 10,011
Contributions from reserves 729,384 78,511
Contributions from reserve funds 81,604 -
Total revenues 5,823,406 4,440,598
Expenses
Personnel costs 4,945,810 3,379,237
Collections, operating and materials 219,112 188,816
Facility support 307,642 199,623
Products & supplies 44,139 44,390
Programs 31,412 41,826
Contracted services 76,967 107,879
Information Technology 142,720 188,810
Staff development 55,604 44,396
mortization expense 514,647 544,073
Transfer to reserves -256,916
Total expenses 6,338,053 4,995,966
Annual deficit (514,647) (555,368)
45
Statement of Operations - Museum
Supplementary Schedule
for the year ended December 31, 2025
2025 2024
Actual Actual
Note 23
$ $
Revenues
Municipality of Clarington operating grant 421,911 328,114
Province of Ontario grant -39,353
Government of Canada grant -8,394
Grants from others 25,161 -
Fines, fees, sales, discards 3,016 2,795
Donations and bequests 1,469 441
Interest 25,100 35,750
Miscellaneous 4,368 6
Contributions from reserves 53,173 65,185
Total revenues 734,542 480,038
Expenses
Personnel costs 580,567 319,021
Collections, operating and materials 43,576 1,477
Facility support 76,775 57,081
Products & supplies 10,568 4,729
Programs 4,436 5,686
Contracted services 18,039 91,715
Information Technology 809 1,954
Staff development 1,071 1,078
Total expenses 735,841 482,741
Annual deficit (1,299) (2,703)
46