The board of Initiatives Prince George (IPG) sent the following statement to Mayor and Council on Friday to clarify a statement made at IPG's budget presentation Wednesday night, which resulted in subsequent media coverage referring to an $800,000 surplus held by IPG.
Mayor and Council,
On behalf of the Board of Directors of Initiatives Prince George (IPG), I wish to advise Mayor and Council that a serious misinterpretation of IPG's financial position was made at the IPG budget meeting of Feb. 9.
IPG has not "squirreled" away funds and does not have a surplus reserve of $800,000 as was referenced at Wednesday night's budget meeting and in today's and yesterday's media coverage.
It should be noted that IPG does not have a surplus in excess of $800,000 as at December 31, 2009. As per page four of the audited financial statements, IPG's fund balances total in 2009 is cumulative and includes the carry forward balances from 2008.
The capital fund represents the unused portion of the building and other capital assets held by IPG.
Buildings and other capital assets are amortized over their estimated useful life and as a result the surplus in the capital fund is representative of the remaining useful life of those assets. Annual amortization of approximately $89,000 is recorded and will eventually deplete this surplus to zero.
This amortization represents the annual usage of the building and other capital assets used by IPG. The capital fund and the annual amortization represent non-cash items.
The total amount of cash on hand as at Dec. 31, 2009 is $61,106. There are no other cash sources held by IPG.
Glen Wonders
Chair
Initiatives Prince George
