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									Mount Royal College Day Care Society
Financial Statements

June 30, 2007
                                     Mount Royal College

                                      Day Care Society

                                     Financial Statements

                                        June 30. 2007




Auditor’s Report

Statement of Financial Position

Statement of Operations

Statement of Changes in Net Assets

Statement of Cash Flows

Notes to the Financial Statements




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                                      Auditor’s Report

To the Board of Directors of the Mount Royal Day Care Society


I have audited the statement of financial position of the Mount Royal College Day Care Society
as at June 30, 2007 and the statements of operations, changes in net assets, and cash flows for the
year then ended. These financial statements are the responsibility of the Mount Royal College
Day Care Society’s management. My responsibility is to express an opinion on these financial
statements based on my audit.

I conducted my audit in accordance with Canadian generally accepted auditing standards. Those
standards require that I plan and perform an audit to obtain reasonable assurance whether the
financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.

In my opinion, these financial statements present fairly, in all material respects, the financial
position of the Mount Royal College Day Care Society as at June 30, 2007 and the results of its
operations and its cash flows for the year then ended in accordance with Canadian generally
accepted accounting principles.



                                                         “Original Signed by Fred J. Dunn”, FCA
                                                                                Auditor General
Edmonton, Alberta
October 26, 2007




“The official version of this Report of the Auditor General, and the information the Report
covers, is in printed form.”
                                Mount Royal College Day Care Society
                                  Statement of Financial Position
                                        As at June 30, 2007


                                                             2007           2006

Current assets

Accounts receivable                                     $     32,708    $    26,661
                                                             165,122         42,024
Due from Mount Royal College                                 197,830         68,685

Capital assets (note 3)                                         6,086         12,631

                                                        $    203,916    $    81,316


Current liabilities

Accrued payables                                        $     19,787    $     9,615
Deferred revenue                                              62,855         19,185
Vacation liability                                            20,483         13,515
                                                             103,125         42,315

Unamortized deferred capital contributions (note 4)             3,367         6,864

Net assets:
 Unrestricted                                                  94,703        26,370
 Investment in capital assets                                   2,721         5,767
                                                               97,424        32,137

                                                        $    203,916    $    81,316




 The accompanying notes are a part of these financial statements.




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                                Mount Royal College Day Care Society
                                      Statement of Operations
                                  For the year ended June 30, 2007



                                           Approved
                                            Budget             2007                2006
                                                                             ____________


                                                               (note 6)


Revenues

Grants:
 Alberta Children’s Services           $       25,000      $        33,735    $       26,107
 Alberta Learning                                                                     23,284
 Other Grants                                  65,000             103,279             65,865
Fees                                          680,312             736,207            640,415
Earned Capital Contributions                                        3,497              3,933
Other                                                  -            5,448              3,215
                                              770,312             882,166            762,819


Expenses

Salaries (note 5)                             603,036             646,883            587,022
Benefits                                       94,636              78,900             76,705
Food services                                  28,560              30,912             27,954
Supplies and printing                          16,269              30,833             17,805
Bad debt expense                                6,000               2,031              2,871
Professional development                        1,020              10,658              4,053
Bank services                                   2,652               7,286              5,200
Advertising                                     4,080               2,578              5,720
Miscellaneous                                   4,500                 255              2,238
Amortization expense                            3,400               6,543              7,856
                                              764,153             816,879            737,424

Excess of revenues over expenses       $           6,159   $        65,287    $       25,395




   The accompanying notes are a part of these financial statements.


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                                Mount Royal College Day Care
                             Statement of Changes in Net Assets
                              For the year ended June 30, 2007


                                                                       2007                              2006
                                                            Investment in
                                               Unrestricted Capital Assets                Total          Total


Excess of revenues over expenses               $      65,287       $             -    $    65,287    $     25,395

Changes in investment in capital assets
 amortization of internally funded assets                 3,046
                                              _____________               (3,046)
                                                                  ____________




Increase (decrease) in net assets                      68,333             (3,046)           65,287          25,395

Balance, beginning of year                             26,370               5,767           32,137           6,742

Balance, end of year                           $      94,703
                                              ____________         $       2,721
                                                                  ___________         $    97,424
                                                                                     ___________     $     32,137




    The accompanying notes are a part of these financial statements.




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                              Mount Royal College Day Care Society
                                   Statement of Cash Flows
                                 Forthe year ended June 30, 2007


                                                             2007            2006

Operating activities:
       Excess of revenues over expenses                  $    65,287     $    25,395

  Non-cash transactions
      Amortization of capital assets                           6,543           7,856
      Earned Capital Contributions                            (3,497)         (3,933)

  Net change in non-cash working capital                      54,765           2,804

Cash generated from operating activities                     123,098          32,122

Investing activities:
   Acquisition of capital assets
        From internal funds                                          -          (942)

Cash used for investing activities                                   -          (942)


Increase in due from Mount Royal College                     123,098          31,180

Due from Mount Royal College,
  beginning of year                                           42,024          10,844

Due from Mount Royal College,
  end of year                                            $ 165,122       $    42,024




  The accompanying notes are a part of these financial statements.




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                       Mount Royal College Day Care Society
                         Notes to the Financial Statements
                         For the year ended June 30, 2007

Note 1   Purpose of the Organization

         The Mount Royal College Day Care Society (the “Society”) is incorporated under the
         Societies Act of the Province of Alberta. It is governed by a Board of Directors, the
         majority of whose members are appointed by Mount Royal College (the “College”).

         The Society is formed to provide day care service primarily for children of students and
         employees of the College, as well as members of the general public. The Society also
         provides a facility for practicum experience for students in the College’s Early
         Childhood Education Program. The Society’s operation is dependent on financial
         contributions provided by Alberta Children’s Services and Alberta Education.

Note 2   Significant Accounting Policies

         a) General and Use of Estimates

         These financial statements have been prepared in accordance with Canadian generally
         accepted accounting principles. The measurement of certain assets and liabilities is
         contingent upon future events; therefore, the preparation of these financial statements
         requires the use of estimates, which may vary from actual results. The following
         accounting policies and reporting practices are considered significant.

         b) Revenue Recognition

         Restricted contributions are deferred and recognized as revenue in the year in which
         the related expenses are incurred. Unrestricted contributions are recognized as
         revenue when receivable.
         Fees and contract revenue are deferred and then recognized as revenue in the period
         the services are provided.

         c) Capital Assets

         Capital assets are recorded at cost. Contributed capital assets are recorded at fair
         value at the date of contribution when fair value can be reasonably determined;
         otherwise they are recorded at a nominal value. Amortization is provided on a straight-
         line basis over the asset’s estimated useful life, which for furnishings and equipment is
         3 tolO years, for leasehold improvements is 5 years, and for computer equipment is 3
         years.

         d) Financial Instruments

         The carrying value of the due from Mount Royal College, accounts receivable, vacation
         liability and accounts payable approximate their fair value due to the relatively short
         periods to maturity of the instruments.



                                              8
Note 2   Significant Accounting Policies (Continued)

         e) Contributed Services

         Mount Royal College provides 680 square meters of space to the Society to operate its
         programs and provide its services. As well, the costs associated with the provision of
         certain equipment, furniture and overhead have been borne by the College. The
         Society provides the College with a program base for students of the College’s Early
         Childhood Education Program to complete the practicum experience component of
         their studies. The value of the services provided by the College to the Society, and by
         the Society to the College, are not recognized in these financial statements.

         f) Unamortized Deferred Capital Contributions

         The unamortized deferred capital contributions are recognized in revenue in the same
         period as the amortization on the capital assets.
         g) Due from Mount Royal College

         This represents the Society’s cash that is held by Mount Royal College.


Note 3   Capital Assets

                                                      2007                                2006
                                        Cost       Accumulated        Net Book           Net Book
                                                   Amortization        Value              Value


          Computer equipment          $ 1,475       $ 1,475       $              -   $              -




          Furnishings and equipment      44,545        39,506             5,039             11,234

          Leasehold improvements          1,745            698            1,047               1,397

                                      $ 47,765      $ 41,679      $      6,086       $      12,631




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Note 4   Unamortized deferred capital contributions

                                                                           2007        2006


             Earned and transferred to revenue                           $ (3,497)    $ (3,933)


             Decrease during the year                                      (3,497)         (3,933)

             Balance, beginning of year                                      6,864         10,797

             Balance, end of year                                        $ 3,367      $ 6,864



Note 5   Salaries and Benefits

         This note complies with the requirements of the Alberta Treasury Board Salary and
         Benefits Disclosure Directive dated December 16, 1998 (amended on June 13, 2007)
         as applied to the Society.

                                                                                                     2007        2006
                                                                 Other        Other
                                           Base                   Cash       Non-cash
                                           Salary     (1)       Benefits~2’) Benefits (3)            Total       Total
         Chairman and members
         of the Board   (4)                $     -          $        -            $    -        $        -   $           -


         Executive Director (5)            $ 52,376 $                5,000 $          4,851     $ 62,227 $ 61,998



                 1) Base salary includes pensionable base pay.
                 2) Other cash benefits include bonuses, overtime, lump sum payments and honoraria
                 3) Employer’s share of all employee benefits and contributions or payments made on
                    behalf of employees including pension, health care, dental
                    coverage, out of country medical benefits, group life insurance, accidental disability
                    and dismemberment insurance, and long term disability plan.
                 4) The Society’s Board of Directors receive no remuneration for their service.
                 5) The Executive Director includes two incumbents; the Executive Director from
                    December 2006 until June 2007 and the Acting Executive Director from July 2006
                    to December 2006.




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Note 6            Statement of Operations by Program

                 The Society receives grant funding for the Supported Childcare program and salary
                 enhancement. The grants are received from the Ministry of Alberta Children’s Services.
                 Any deficiency of revenue over expense is funded out of fees. The grants have been
                 accounted for as follows in the current year:


                                       Mount Royal College Day Care Society
                                              Statement of Operations
                                         For the year ended June 30, 2007

                                       Day Care     Preschool            Supported         2007          2006
                                       Services      Program             Childcare         Total         Total

  Revenues

  Grants:
   Alberta Children’s Services        $             $           -        $   33,735    $    33,735   $   26,107
   Alberta Education                                                                                      23,284
   Other Grants                           103,279               -            31,997
                                                                                -          103,279        65,865
  Fees                                    633,092            103,115            -          736,207       640,415
  Earned Capital Contributions              3,497               -               -            3,497         3,933
  Other                                     3,900              1,548            -            5,448         3,215
                                          743,768            104,663         33,735        882,166       762,819

  Expenses

  Salaries                                553,611            61,275                        646,883       587,022
  Benefits                                 70,259              4,486          4,155         78,900        76,705
  Food Services                            30,912                                           30,912        27,954
  Supplies and Printing                    27,665              3,168                        30,833        17,805
  Bad Debt Expense                          2,031                                            2,031         2,871
  Professional Development                 10,568                   90                      10,658         4,053
  Bank Services                             7,286                                            7,286         5,200
  Advertising                               1,179              1,399                         2,578         5,720
  Miscellaneous                               255                                              255         2,238
  Amortization Expense                      6,543                                            6,543         7,856
                                          710,309            70,418          36,152        816,879       737,424

  Excess (deficiency) of revenues
            over expense              $   33,459    $        34,245      $   (2,417)   $    65,287   $   25,395



Note 7           Approval of Financial Statements

                 These Statements were approved by the Society’s Board of Directors.




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