2004/05 Audited Financial Statements An Overview November 9, 2005

Agenda Highlights Review of Statements PHRD Schools & Sites ADLC

Enrolments 94/9503/0404/05 Proj. 04/05 Actual Kindergarten - Community Schools Grades Community Schools Vista Virtual Total K-12 Excl. Virtual

Average CEU Completion Rate Jurisdiction Average Jurisdiction Average, excl. Vista Virtual 02/03 (gr. 11 & 12) /04 (gr. 11 & 12) /05 (gr ) NOTE: 1092 of the 1238 Vista Virtual students are in grades Because these students only register for 1-2 courses each, their completion average (04/05=7.68) distorts the PHRD Community Schools average.

ADLC Highlights Total Students Served: 04/05 – 14,651; 3, FTE 03/ ,449; 3, FTE % increase = 8.94% (+2.65% FTE) Funded Students Served: 04/05 – 12,502; 2, FTE 03/ ,359; 2, FTE % increase = 10.06% (+4.31% FTE)

04/05 Operating Surplus (Deficit) Pembina Hills Regional Div. No. 7$358,675 03/04 = $(116,355) Alberta Distance Learning Centre$29,500 03/04 = $198,804

Operating & Capital Reserves PHRD$4.82 million (03/04=$4.72 million) Represents 11.5% of 04/05 operational expenses (03/04=11%) Operating Reserves only = $2.6 million, or 6.30% of operational expenses ADLC$0.98 million (03/04=$0.97 million) Represents 10% of 04/05 operational expenses (03/04 =10%)

The Statements A Quick Overview

Statement of Financial Position (aka Balance Sheet) Primary purpose - to present the PHRD’s economic resources, obligations and net assets (equity) at August 31 Assets - funded by liabilities and/or equity

Balance Sheet - some unique terms School Generated Funds (SGF) funds under control & responsibility of schools (eg. yearbook sales, grad fees, etc) Balance Sheet states the ending bank balances of SGF’s. Deferred Capital Allocations funds received for capital projects (eg. Block Modernization funds) that have not been expended at August 31

Balance Sheet - some unique terms Unamortized capital allocations supported capital funds that have been expended but have yet to be amortized over the useful life of the applicable assets purchased Represents the provincial government’s equity in our school buildings

Overview - PHRD Balance Sheet

Overview - ADLC Balance Sheet

Statement of Revenues and Expenses (aka Income Statement) Provides information on PHRD’s operations for the year. Surplus (Deficit) of revenue over expenses represents the change in PHRD’s unrestricted resources as a result of operations for the year. Surplus (Deficit) does not account for unsupported capital additions or transfers to and from reserves. Comparative 2004/05 budget figures are those approved May 12, They do not account for budget adjustments throughout the year (eg. actual Sept enrolment)

Overview - PHRD Statement of Revenues and Expenses

Overview - ADLC Statement of Revenues and Expenses

Statement of Changes in Net Assets (aka Statement of Changes in Equity) “Total net assets” = equity Equity represents the jurisdiction’s residual interest (value) in the assets. To fully understand the nature of PHRD’s financial activities in the period, information is required about changes to net assets as a result of: Operations Capital assets Assets that are externally and internally restricted.

Statement of Changes in Net Assets (aka Statement of Changes in Equity) The statement of changes in net assets provides critical financial information and shows the extent to which PHRD’s activities have resulted in an increase or decrease in net assets

Overview - PHRD Statement of Changes in Equity

Overview - ADLC Statement of Changes in Equity

Statement of Cash Flows Reports and explains the PHRD total changes in cash equivalents as a result of activities during the year PHRD experienced a decrease in cash flow from the beginning of the year of $251,248 ADLC experienced an increase in cash flow from the beginning of the year of $905,704 Main contributor to increased cash flow Aug 31/04 PHRD owed ADLC $680,779 Aug 31/05, ADLC owed PHRD $115,550 (net difference - $796,329)

PHRD Schools & Sites Summary Information

Renewed Funding Framework 04/05 marked the 1 st year of the Renewed Funding Framework The renewed framework is an allocation system and is not intended to provide expenditure direction. Jurisdictions have enhanced flexibility to spend funding as they choose to meet needs of their students’ and local priorities This supports the principle of flexibility

Instruction Budget Surplus/ (Deficit) – Sept/04 (budget adjusted for actual enrolment) Actual Surplus/ (Deficit) 2004/05 Community Schools $(67,730)$181,429 Co-op Pool$100,000$259,719 Total Instruction (03/04 = $34,405) $32,270$441,148

Instruction Instructional Operating Aug 31/05 - $2,547,106 (03/04=$2,105,958) Community Schools - $1,362,717 (03/04=$1,181,285) Co-op Pool - 800,293 (03/04=$234,545) WAN (telephone system) - 0 (03/04=$306,029) Vista Virtual - 384,096 (03/04=$384,096) Average program cost per FTE student in Kindergarten to Grade 12 - $6,566 03/04=$6,381

Co-op Pool 04/05 Surplus/(Deficit) = $259,719 03/04 = $66,013 Variance Analysis RevenueExpenses Class Size Initiative - +$737,093 Small School by Necessity - +$333,973Video Conferencing/Smart Board (cost shared with AISI) - +$85,000 Socio Economic Status - +$125,308VOIP Communication System - +$378,873 Stabilization Funding - +$117,432Other net variances - +$2,481 FNMI - +$69,360 Hutterite funding - +$20,000 Video-Conferencing 1 time funding - +$60,000

Co-op Pool (cont.) Operating Aug 31/05 = $800,293 Recommendation for disbursement of reserve to be discussed at November 24, 2005 Administrators’ meeting Recommendation will be placed on December 14, 2005 Regular Board Meeting Agenda

Barrhead Composite High School 04/05 Surplus/(Deficit) - $(8,313) 03/04 = $85,775 04/05 budgeted transfer from operating reserve(deficit) - $75,000 Average high school CEU completion rate – (gr ) 03/04 (gr 11&12) = Operating Aug 31/05 - $323,972

Barrhead Elementary School 04/05 Surplus/(Deficit) - $34,799 03/04 = $(43,350) 04/05 budgeted Surplus/(Deficit) - $(64,066) Operating Aug 31/05 - $205,195

Busby School 04/05 Surplus/(Deficit) - $(2,472) 03/04 = $(8,579) 04/05 budgeted Surplus/(Deficit) - $(6,493) Operating Aug 31/05 - $51,040

Dapp School 04/05 Surplus/(Deficit) - $(19,112) 03/04 = $13,291 03/04 budgeted Surplus/(Deficit) - $(15,000) Operating Aug 31/05 - $168,404

Dunstable School 04/05 Surplus(Deficit) - $7,480 03/04 = $(7,043) 04/05 budgeted Surplus/(Deficit) - $(2,277) Operating Aug 31/05 - $94,874

Eleanor Hall School 04/05 Surplus/(Deficit) - $(266) 03/04 = $(32,043) 04/05 budgeted Surplus/(Deficit) - $696 Operating Aug 31/05 - $(32,976) A 2 year deficit reduction plan has been developed by the school, with approx. $20,000 of the accumulated deficit to be recaptured in the 05/06 school year and the balance in 06/07

Fort Assiniboine School 04/05 Surplus/(Deficit) - $3,712 03/04 = $(19,588) Includes Forestry Funding of $82,341 04/05 budgeted Surplus/(Deficit) - $(22,783) Average high school CEU completion rate – (gr 10-12) 03/04 (gr 11&12)=29.69 Operating Aug 31/05 - $52,323

Hillman Colony School 04/05 Surplus/(Deficit) - $(2,990) Low enrolment continues to be a challenge 04/05 – 2 Kindergarten students; 14 students in grades /06 change in ESL funding for Hutterite students in Colony Schools – 5 yr. Max. funding limit may be waived for individual students Operating Aug 31/05 - $3,010

Jarvie School 04/05 Surplus/(Deficit) - $(19,664) 03/04 = $5,118 04/05 budgeted Surplus/(Deficit) - $(20,489) Operating Aug 31/05 - $871

Meadowview School 04/05 Surplus/(Deficit) - $(17,181) 03/04 = $662 $17,810 in Federal CAP funding remaining for future years’ expenditures 04/05 budgeted Surplus/(Deficit) - $(29,746) Operating Aug 31/05 - $36,997

Neerlandia School 04/05 Surplus/(Deficit) - $22,432 03/04 = $(11,531) 04/05 budgeted Surplus/(Deficit) - $4,740 Operating Aug 31/05 - $142,488

R.F. Staples Secondary School 04/05 Surplus/(Deficit) - $38,273 03/04 = $(131,058) 04/05 budgeted Surplus/(Deficit) - $(78,176) Average high school CEU completion rate – (gr 10-12) 03/04 (gr 11&12)=34.81 Operating Aug 31/05 - $152,788

Sunniebend Colony School 04/05 Surplus/(Deficit) - $4,153 Low enrolment continues to be a challenge 04/05 – 3 Kindergarten students; 11 students in grades /06 change in ESL funding for Hutterite students in Colony Schools – 5 yr. Max. funding limit may be waived for individual students Operating Aug 31/05 - $5,153

Swan Hills School 04/05 Surplus/(Deficit) - $65,425 03/04 = $56,394 04/05 budgeted Surplus/(Deficit) - $32,214 Average high school CEU completion rate – (gr 10-12) 03/04 (gr 11&12)=29.53 Operating Aug 31/05 - $64,393

Vimy School 04/05 Surplus/(Deficit) - $29,614 03/04 = $(34,895) 04/05 budgeted Surplus/(Deficit) - $28,235 Operating Aug 31/05 - $(4,129)

W.R. Frose School 04/05 Surplus/(Deficit) - $(17,384) 03/04 = $(7,994) 04/05 budgeted Surplus/(Deficit) - $10,901 Operating Aug 31/05 - $(31,313) A 2 year deficit reduction plan is being developed by the school

Westlock Elementary School 04/05 Surplus/(Deficit) - $55,655 03/04 = $(77,073) 04/05 budgeted Surplus/(Deficit) - $72,546 Operating Aug 31/05 - $132,915

Outreach Centres 04/05 combined surplus/(deficit) - $7,268 03/04 = $(122,981) Combined CEU completion rate – (gr ) 03/04 (gr 11&12) = Combined Operating Aug 31/05 - $(3,288) Accumulated deficit to be recovered in 05/06

Vista Virtual A virtual school operated by PHRD PHRD contracts the ADLC OnLine Program to provide instruction. Similarly, other school jurisdictions contract ADLC OnLine to provide instruction for their virtual programs. 1,238 students were registered with Vista Virtual in 04/05 03/04 – 1,107 High School CEU completion rate = 7.68 (gr 10-12) 03/04 (gr 11&12)=6.69 lower completion due to students taking only a portion of their courseload thru OnLine 04/05 instructional funding received - $1,863,223

Operations & Maintenance of Schools 04/05 Surplus/(Deficit) - $(102,983) 03/04=$(1,639) 04/05 Surplus/(Deficit), excluding gain on sale from Swan Hills House - $(130,972) Projected Surplus/(Deficit) - $(178,470) Responsibility for funding of PO&M transferred from Alta. Infrastructure & Transportation to Alta. Education effective April 1, 2005 PO&M funding for boards from April 1-Aug 31/05 not finalized Based April 1-Aug 31/05 estimate on letter received from AIT in October, 2004 Based on summer of 2005 announcement from AIT, 05/06 PO&M funding should increase approx. $300,000 over 04/05 levels

Operations & Maintenance of Schools Average cost per FTE student in Kindergarten to Grade 12 - $1,345 03/04 - $1,329 Average cost, excluding debenture & BQRP costs - $766 03/04 - $729 Aug 31/05 Operating - $(80,735) Capital (for future fleet replacements) - $131,084 Capital –Swan Hills Property Disposition (for future upgrades to Swan Hills School) - $27,990

Student Transportation 04/05 Surplus/(Deficit) - $(6,237) 03/04=$102,823 04/05 budgeted Surplus/(Deficit) - $46,129 An annual surplus is required in the transportation area to help fund the cost of replacement buses for the division owned fleet

Student Transportation Average cost per student transported - $1,320 02/03 - $1,261 03/04 - $1,335 Operating Aug 31/05 - $109,351 Capital Reserve (for future fleet replacements) - $392,962 Represents funding for approx. 5 buses

Board & System Administration 04/05 Surplus/(Deficit) - $32,903 03/04=$(35,778) Average cost per FTE student in Kindergarten to Grade 12 - $355 (03/04 - $375) Variance attributable to replacement of computer workstations in 03/04 as well as employee recognition program start-up costs Average cost per ADLC Funded FTE student - $175 Operating Aug 31/05 - $56,906

External Services 04/05 Surplus/(Deficit) - $(6,156) 03/04=$(147,356) Operating Aug 31/05: Bhd. Adult Learning - $22,519 Bhd. Adult Literacy - $12,719 SHARE (Swan Hills) - $15,041

Alberta Distance Learning Centre

ADLC - Operating 04/05 Surplus/(Deficit) - $29,500 03/04=$198,804 Operating Reserve at August 31/05 - $981,684 Initiatives Operating Reserve - $330,009 General Operating 651,675