2017 Annual Report

85 City of Chilliwack 2017 Annual Report TOURISM CHILLIWACK INC. Notes to Consolidated Financial Statements Year ended December 31, 2017 Basis of presentation: Tourism Chilliwack Inc. (the "Company") was incorporated on December 16, 2006 and began operations on January 1, 2007. The Company is wholly-owned by the City of Chilliwack. The mandate of the Company is to develop and promote the tourism industry as well as provide economic development programs and services aimed at growing the tourism industry in the City of Chilliwack. 1. Significant accounting policies: These financial statements are prepared in accordance with the CPA Canada Public Sector Accounting Handbook. The Company's significant accounting policies are as follows: (a) Basis of consolidation: The consolidated financial statements include the accounts of the Company and the Company's proportionate interest in the Fraser Valley Joint Venture. All material inter-entity accounts and transactions have been eliminated. (b) Inventories: Inventories are measured at the lower of cost and net realizable value by using first-in, first- out costing methodology. The Company uses the same cost formula for all the inventories having a similar nature and use to the entity. When circumstances which previously caused inventories to be written down no longer exist the previous impairment is reversed. (c) Interest in joint venture: Interest in joint venture is considered to be in government unit and accordingly is accounted on a proportionate basis in the accounts of the Company. (d) Tangible capital assets: Tangible capital assets are stated at cost, less accumulated amortization. Amortization is provided using the following methods and annual rates: Asset Basis Useful life - years Furniture and fixtures Declining balance 30% Computer Declining balance 30% Leasehold improvements Declining balance 30% Website Declining balance 45% Works of art and cultural and historical assets are not recorded as assets in these financial statements. Purchased works of art are expensed in year acquired. 5 Tourism Chilliwack Inc. Financial Statements