2012 chs annual report

2012 ANNUAL REPORTMore than a shelter

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6-78-91011

12-22

chairdirectorvideosupportersresponsibility auditorsfinancials

Message from Deanna Steblyk, Board Chair for the Calgary Humane Society

Message from Mark Takhar, Executive Director for the Calgary Humane Society

Video of the 2012 Annual General Report

The Calgary Humane Society gratefully acknowledges our supporters

Management’s Responsibility to the members of the Calgary Humane Society for prevention of cruelty to animals

Independent Auditors’ to the Members of the Calgary Humane Society for Prevention of Cruelty to Animals

Calgary Humane Society for Prevention of Cruelty to Animals Statement of Financial Position

42012 Annual ReportCalgary Humane Society

chairMessage from Deanna Steblyk, Board Chair for the Calgary Humane Society

Once again, it is my pleasure and privilege to report on another successful year at the Calgary Humane Society. In 2012, we celebrated our 90th Anniversary in the city, welcomed a new Executive Director who has loads of personality and a wealth of experience in the animal welfare sector, enjoyed hosting our usual set of fun-filled special events, and, most importantly, helped thousands of animals find their forever homes. Our exceptional staff and volunteers worked hard to maintain, expand, and improve our broad host of programs and services, develop resources, and ensure that all of the critters who passed through our doors received the very best in care and attention. On behalf of the Board of Directors, I would like to take advantage of this annual opportunity to thank everyone involved in generating this success, including our valued members and supporters. Your efforts are seen and appreciated, and none of what we do would be possible without each and every one of you. We look forward to working with you all in 2013 to continue our efforts to help as many animals as we can.

Deanna Steblyk, Board Chair


Mark Takhar, Executive Director

directorMessage from Mark Takhar, Executive Director for the Calgary Humane Society

When I first accepted my position at Calgary Humane Society I was told I was coming to work for an amazing organization. A few weeks later I arrived for my first day to find dozens of staff decked out in neon yellow t-shirts and bouncy castles on the front lawn. My first day coincided with a birthday party for the Calgary Humane Society… a celebration of 90 years of connecting lives. It was by far the best greeting that anyone could wish for.

As I look back on my first year here I can say, without a doubt, that Calgary Humane Society is a wonderful place to be and I am very fortunate that I have the opportunity ‘to help as many animals as we can.’

Today we are excited to share with you, our members, a snapshot of 2012 at Calgary Humane. In the past 90 years Calgary Humane Society has become ‘more than a shelter’ and we look forward to continuing our work in connecting lives and being leaders in animal welfare. We are proud as we look back on the accomplishments of 2012, but more importantly it is with excitement that we look forward to our future. Calgary Humane Society would not be here without you.

Thank you for your support.


videoVideo of the 2012 Annual General Report

http://youtu.be/nEY3wuXRMPM

Video: Department Overview

• Adoptions• Animal Admissions• Animal Care• Animal Health• Behavior

• Breed Rescue• Communications & Marketing• Protection & Investigations• Resource Development• Volunteer & Fostering

Follow the link below to watch the full video of the 2012 Annual General Report:


Video: Highlights

Protection & Investigation Animal Admissions

Animal Health Resource Development

CHS Volunteers Humane Education


supportersThe Calgary Humane Society gratefully acknowledges the following supporters:

INDIVIDUALSAchtman, ConnieAnderson, GordonBalm, SherriBarber, John & PamBascom, JohnBennett, L.Benningen, ReneeBenny, MikeBerkhold, GrahamBirchall, Larry & RuthBjorndalen, Cathy & Sudlow, PaulBloom, DebbieBragg, RuthBrennan, PatrickBrightman, FamilyButalia, JasCarey, MiriamCarter, DaveChambers, LauraineChartrand, LucChomey, BryonClark, RobertCole, KrisCook, DonCoughlan, AnnelieseCrosson, BrentDamberger, StevenDamps, BridgetDavidson, JamesDeoni, ColleenDobson, MarilynDouglas, DanielDraper, JeanFesyk, DavidFichter, DarrenFreeze, AnnieGabriel, VincentGirard, LouisGodin, StephanieGordon, LyleGorman, DeirdreGrayson, AliciaHampson, ChrisHansen, ArneHartley, GordonHatch, Laura

Hibberd, BarbaraHobbs, Robert & AnneHolland, DaveHorn, B.Hunt, RosemaryHutchinson, WilliamJamieson, MarilynJircik, VictorJohnston, LaurieKelly, GloriaKendall, CherylKoftinoff, SherryLaing, Peta LynL’Amarca, DonnaLaszlo, AdriannaLawson, AnthonyLeong, AnthonyLivermore, AmyLundberg, MaryMacDonald, AngelaMacDonald, GlennMacNeill, BrianMarshall, MurrayMcBean, BruceMcCarthy, BonitaMerk, M LuiseMills, ChristopherNg, ElizaNieman, RiaanPasley, ScottPetriuk, StacyPezzin Enns, DevinPhillips, DonaldPhilp, GregoryPower, JeffReiser, SusanRiccio, Lucio & TrishSalter, ReginaldSchneider, AnnettSchulz, PhilipSchwab, DavidSereda, LeanneShachnowich, A.S.Sherbanuk, TashaSkulski, Catherine L.Sparks, Paul & Janet

Stanfield, M. A.Steblyk, Harvey & DeannaSteiger, DennisStruthers, ChadSzabo, KeithTaylor, MerleThomas, JaneVan Hal, JanVan Niekerk, Drew & SusanVan Schaick, CarolWalker, MargaretWallace, JoanneWalsh, MarieWhite, DeborahWilson, BarbWilson, VickieWilson, JanetWolfe, WayneWriedt, ArthurWright, DavidYanke, CarolZawaly, John

Altarus Supply Ltd.Angles Technical Services Inc.Apache Canada Ltd.ARC Financial Corp.ATCO Energy Solutions Ltd.ATCO EpicATCO Power Canada Ltd.BMO Bank of MontrealBuchanan Barry LLPCalgary Co-operative Association Ltd.Calgary HondaCDMVCenovus Energy Inc.Central Auto Parts Distributors Ltd.Central Services FundraisingChurchill Armoured Car Service Inc.CIBC Wood GundyCity of CalgaryConocoPhillips CanadaCoral Lane Group Inc.Country Hills PetroleumDeerfoot MallDeloitte Management Services LPDennis Mahoney Trucking Ltd.DP Consulting Services LTDEECOL Electric Corp.EnCana CorporationFirst Calgary FinancialFirstEnergy Capital Corp.Fish Creek SchoolFranklin Templeton Investments CorpFreehold Royalties Ltd.Future Shop - ShawnessyGift Funds CanadaHalliburton Canada Inc.Home Trust CompanyIan Bazalgette SchoolKent Hansen The Plumber Ltd.Kiewitt EnergyLanmark Engineering Inc,LululemonMacleod Trail Animal HospitalMaggnum Ventures Inc.Media Learning Systems Inc.MNP - LLPMovac Mobile Vacuum Services Ltd.

CARING CORPORATIONS


MSH International (Canada) Ltd.Oilquest Resources Inc.Otafest 2012People Engaged In (P.E.I.) Benevolent Activities AssociationPet Valu Canada Inc.Progress Energy Canada Ltd.QV InvestorsRedwater CorporationRobane Management Ltd.Rocky View County Cultivating CommunitiesShaw Communications Inc.Sinopec Daylight Energy Ltd.Spartan Controls LtdStan Poulsen Trucking Ltd.T3 Social Corporation Ltd.TELUSThe Bank of Nova Scotia Trust CompanyThe Qualico PartnershipTransCanada Pipelines LimitedTrotter & MortonUnited Communities L.P.United Way of Calgary and Area, Donor Choice ProgramUnited Way of Fort McMurrayUnited Way of Greater TorontoUnited Way of Peel RegionUnited Way of the Alberta Captial RegionVetoquinol Canada Inc.Vistavu Solutions Inc.Western Financial Insurance CompanyWhite Minerals Ltd.

Anne Marie Peterson Legacy FundBelich Family FundBoston Pizza FoundationCalgary Real Estate Board FoundationCanadian Online Giving FoundationChinook FoundationDT Kayra FundDr. Jocelyn P. Mandelstam FoundationElmer and Penny Harbridge FundEncana Cares FoundationFirstEnergy Community FoundationGeorgina Sawyer Memorial FoundationJohn and Elsie Collins FoundationLawrence W. West Family FundLily Street FoundationMacquarie Group Foundation LtdN. Murray Edwards Charitable FoundationNickle Family FoundationPatrick E. Fuller FoundationRuth Elizabeth Craig FundSouthworth Charitable FoundationStrategic Charitable Giving FoundationThe Calgary FoundationThe William and Constance Topley FundViewpoint Charitable Foundation

Estate of Alice RitterEstate of Arthur Bruce RobertsEstate of Bererly Anne WattEstate of Betty Helena SmartEstate of Edna Carr-MegliEstate of Flora McDonald BrownEstate of Hazel Elizabeth GillespieEstate of Herta TresnakEstate of Horst Guenter RittnerEstate of Jeanne Patricia JeffreyEstate of Joan Isabella GriffithsEstate of Margaret Erminie RasonEstate of Muriel Agnes MacBeanEstate of Pirkko AhonenEstate of Theresa Catherine BaxterEstate of Violet SmealEstate of William Henry Samuel Engelke

FOUNDATIONS BEQUESTS

The Calgary Humane Society gratefully acknowledges all of our generous donors many of whom wish to remain anonymous. We sincerely apologize for any name that have been inadvertently omitted.


responsibilityManagement’s Responsibility to the Members of the Calgary Humane Society for Prevention of Cruelty to Animals

Management is responsible for the preparation and presentation of the accompanying financial statements, including responsibility for significant accounting judgments and estimates in accordance with Canadian accountingstandards for not-for-profit organizations and ensuring that all information in the annual report is consistent with thestatements. This responsibility includes selecting appropriate accounting principles and methods, and making decisions affecting the measurement of transactions in which objective judgment is required.

In discharging its responsibilities for the integrity and fairness of the financial statements, management designs andmaintains the necessary accounting systems and related internal controls to provide reasonable assurance that transactions are authorized, assets are safeguarded and financial records are properly maintained to provide reliable information for the preparation of financial statements.

The Board of Directors and Finance and Audit Committee are composed primarily of directors who are neither management nor employees of the Society. The Board is responsible for overseeing management in the performance of its financial reporting responsibilities, and for approving the financial information included in the annual report. The Finance and Audit Committee fulfils these responsibilities by reviewing the financial information prepared by management and discussing relevant matters with management and external auditors. The Board is also responsible for recommending the appointment of the Society’s external auditors.

MNP LLP, an independent firm of Chartered Accountants, is appointed by the members to audit the financial statements and report directly to them; their report follows. The external auditors have full and free access to, and meet periodically and separately with, both the Committee and management to discuss their audit findings.

Mark Takhar, Executive DirectorMarch 27, 2013


auditorsIndependent Auditors’ to the Members of the Calgary Humane Society for Prevention of Cruelty to Animals

We have audited the accompanying financial statements of Calgary Humane Society for Prevention of Cruelty to Animals, which comprise the statement of financial position as at December 31, 2012, December 31, 2011 and January 1, 2011, and the statements of revenue and expenses and changes in fund balances and cash flows for the years ended December 31, 2012 and December 31, 2011, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of these 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.

Auditors’ ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements 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 entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

Except as explained in the following paragraph, we believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion.

Basis for Qualified OpinionIn common with many not-for-profit organizations, the Society derives a significant portion of its revenue from donations and fundraising, 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 Society and we were not able to determine whether any adjustments might be necessary to revenue, excess of revenue over expenses, assets and fund balances.

Qualified OpinionIn our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements present fairly, in all material respects, the financial position of the Calgary Humane Society for Prevention of Cruelty to Animals as at December 31, 2012, December 31, 2011 and January 1, 2011 and the results of its financial performance and its cash flows for the years ended December 31, 2012 and December 31, 2011 in accordance with Canadian accounting standards for not-for-profit organizations.

Calgary, AlbertaMarch 27, 2013

Chartered Accountants


financialsCalgary Humane Society for Prevention of Cruelty to Animals Statement of Financial Position

The accompanying notes are an integral part of these financial statements.

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Calgary Humane Society for Prevention of Cruelty to AnimalsStatement of Financial Position

As at

General Operating Fund Capital Fund Restricted Fund Total

December 31, 2012

December 31, 2011

December 31, 2012

December 31, 2011

December 31, 2012

December 31, 2011

December 31, 2012

December 31, 2011

January 1,

2011

AssetsCurrent

Cash 1,563,234 1,042,266 - - 66,022 65,766 1,629,256 1,108,032 1,372,228

Accounts receivable 97,235 357,835 - - - - 97,235 357,835 58,770Inventory (Note 4) 64,585 59,166 - - - - 64,585 59,166 78,760

Prepaid expenses 31,762 60,382 - - - - 31,762 60,382 34,855

Due from (to) other funds (1,324,935) (799,010) 1,341,580 815,399 (16,645) (16,389) - - -

431,881 720,639 1,341,580 815,399 49,377 49,377 1,822,838 1,585,415 1,544,613

Marketable securities (Note 5) 8,114,767 7,329,101 - - - - 8,114,767 7,329,101 6,789,880Property and equipment (Note 6) - - 7,992,292 8,490,870 - - 7,992,292 8,490,870 9,038,492

8,546,648 8,049,740 9,333,872 9,306,269 49,377 49,377 17,929,897 17,405,386 17,372,985

LiabilitiesAccounts payable

and accrued liabilities (Note 7)510,347 398,299 - - - - 510,347 398,299 393,797

Deferred revenue 51,476 57,763 - - - - 51,476 57,763 55,537

561,823 456,062 - - - - 561,823 456,062 449,334

Fund balancesUnrestricted (Note 8) 1,098,816 667,110 - - - - 1,098,816 667,110 818,844Restricted for endowment purposes (Note 9)

- - - - 45,000 45,000 45,000 45,000 45,000

Invested in property and equipment - - 7,992,292 8,490,870 - - 7,992,292 8,490,870 9,038,492

Externally restricted (Note 10) 21,671 72,395 - - 4,377 4,377 26,048 76,772 104,351Internally restricted (Note 10) 6,864,338 6,854,173 1,341,580 815,399 - - 8,205,918 7,669,572 6,916,964

7,984,825 7,593,678 9,333,872 9,306,269 49,377 49,377 17,368,074 16,949,324 16,923,651

8,546,648 8,049,740 9,333,872 9,306,269 49,377 49,377 17,929,897 17,405,386 17,372,985

Approved on behalf of the Board:

________________________________ Director ______________________________ Director


The accompanying notes are an integral part of these financial statements.4

Calgary Humane Society for Prevention of Cruelty to AnimalsStatement of Revenue and Expenses and Changes in Fund Balances

For the year ended December 31, 2012

General Operating Fund Capital Fund Restricted Fund Total2012 2011 2012 2011 2012 2011 2012 2011

RevenueDonations and fundraising 2,431,428 2,599,462 - 3,000 - - 2,431,428 2,602,462Programs and services 1,851,493 1,882,672 - - - 5,000 1,851,493 1,887,672Bequests 1,922,332 1,161,905 - - - - 1,922,332 1,161,905City of Calgary contribution 259,784 254,690 - - - - 259,784 254,690Investment income 207,390 253,443 - - - - 207,390 253,443Unrealized gain on marketable securities 180,762 20,672 - - - - 180,762 20,672Gain on sale of property and equipment - - 500 96 - - 500 96

6,853,189 6,172,844 500 3,096 - 5,000 6,853,689 6,180,940

ExpensesWages and employee benefits 3,934,175 3,692,805 - - - - 3,934,175 3,692,805Operating 972,965 1,025,504 - - - - 972,965 1,025,504General and administrative 356,564 428,404 - - - - 356,564 428,404Fundraising 553,253 391,599 - - - - 553,253 391,599Amortization - - 617,982 616,955 - - 617,982 616,955

5,816,957 5,538,312 617,982 616,955 - - 6,434,939 6,155,267

Excess (deficiency) of revenue overexpenses 1,036,232 634,532 (617,482) (613,859) - 5,000 418,750 25,673

Fund balances, beginning of year 7,593,678 7,690,081 9,306,269 9,188,453 49,377 45,117 16,949,324 16,923,651Inter-fund transfers (Note 8) (645,085) (730,935) 645,085 731,675 - (740) - -

Fund balances, end of year 7,984,825 7,593,678 9,333,872 9,306,269 49,377 49,377 17,368,074 16,949,324


financialsContinued...

The accompanying notes are an integral part of these financial statements.5

Calgary Humane Society for Prevention of Cruelty to AnimalsStatement of Cash Flows


2012 2011

OperatingExcess of revenue over expenses 418,750 25,673Items not affecting cash

Amortization 617,982 616,955Unrealized gain on marketable securities (180,762) (20,672)Loss (gain) on sale of marketable securities 55,084 (43,157)Gain on sale of property and equipment (500) (96)Foreign exchange loss on investment account 5,350 6,627

915,904 585,330

Changes in non-cash working capital:Accounts receivable 260,600 (299,065)Inventory (5,419) 19,594Prepaid expenses 28,620 (25,527)Accounts payable and accrued liabilities 112,048 4,502Deferred revenue (6,287) 2,226

1,305,466 287,060

InvestingPurchase of equipment (119,404) (69,333)Proceeds on sale of equipment 500 96Proceeds on sale of marketable securities 3,400,912 5,965,194Purchase of marketable securities (4,066,250) (6,447,213)

(784,242) (551,256)

Increase (decrease) in cash resources 521,224 (264,196)

Cash, beginning of year 1,108,032 1,372,228

Cash, end of year 1,629,256 1,108,032


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Calgary Humane Society for Prevention of Cruelty to AnimalsNotes to the Financial Statements


1. Nature of operations

The Calgary Humane Society for Prevention of Cruelty to Animals (“the Society”) is a not-for-profit organization that wasincorporated under the Alberta Societies Act in 1922. The Society is a registered charity as defined under paragraph149(1)(f) of the Income Tax Act, and therefore, is not subject to income tax. The mandate of the Society is to improve thewelfare of animals through programs and services in sheltering, education, protection and advocacy.

2. Impact of adopting accounting standards for not-for-profit organizations

These are the Society’s first financial statements prepared in accordance with Canadian accounting standards fornot-for-profit organizations (“ASNPO”). The accounting policies in Note 3 have been applied in preparing the financialstatements for the year ended December 31, 2012, the comparative information for the year ended December 31, 2011,and the opening ASNPO statement of financial position as at January 1, 2011 (the Society’s date of transition to ASNPO).

In preparing these financial statements, the Society has elected to apply none of the transitional provisions permitted byCICA 1501 First time adoption by not-for-profit organizations at the date of transition to ASNPO. As such, the transition toASNPO has not affected the statement of financial position, statement of revenue and expenses and changes in fundbalances or statement of cash flows reported under previous Canadian accounting standards for not-for-profitorganizations.

3. Significant accounting policies

The financial statements have been prepared in accordance with Canadian accounting standards for not-for-profitorganizations as issued by the Accounting Standards Board, and include the following significant accounting policies:

Fund accountingThe Society follows the restricted fund method of accounting. Activities of the Society are segregated in the following funds:

i) The General Operating Fund accounts for the Society’s program delivery and administrative activities. This fundreports unrestricted resources, restricted operating grants, and other internally restricted amounts.

ii) The Capital Fund accounts for the assets, liabilities, revenue and expenses related to the Society’s property andequipment. This fund reports both internally and externally restricted funds.

iii) The Restricted Fund accounts for the assets, liabilities, revenue and expenses of the Society’s endowment funds,and its internally and externally restricted funds.

Pledges receivablePledges receivable are not recorded in the Society’s financial statements, as there is no assurance that they will ultimatelybe collected. Pledges are recorded in the financial statements when they are received.

Cash and equivalentsCash and cash equivalents include balances with banks. Cash subject to restrictions that prevent its use for currentpurposes is included in restricted cash.

InventoryGoods for resale are recorded as inventory and are recorded at the lower of cost and net realizable value. Cost isdetermined by the average cost method.

Due from (to) other fundsDue from (to) other funds represents amounts owed between certain funds. These inter-fund balances are non-interestbearing and have no fixed terms of repayment.



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3. Significant accounting policies (continued from previous page)

Financial instruments

The Society recognizes its financial instruments when the Society becomes party to the contractual provisions of thefinancial instrument. All financial instruments are initially recorded at their fair value, including financial assets andliabilities originated and issued in related party transactions.

At initial recognition, the Society may irrevocably elect to subsequently measure any financial instrument at fair value. TheSociety has not made such an election during the year.

The Society subsequently measures its marketable securities at fair value. Fair value is determined by published pricequotations. All other financial assets and liabilities are subsequently measured at amortized cost.

Transaction costs and financing fees directly attributable to the origination, acquisition, issuance or assumption of financialinstruments subsequently measured at fair value are immediately recognized in earnings. Conversely, transaction costsand financing fees are added to the carrying amount for those financial instruments subsequently measured at amortizedcost or cost.

The carrying values of financial assets and financial liabilities measured at amortized cost are as follows:

December 31, 2012 December 31, 2011

Financial assets measured at amortized cost:

Cash 1,629,256 1,108,032

Accounts receivable 97,235 357,835

Financial liabilities measured at amortized cost:

Accounts payable and accrued liabilities 510,347 398,299

Financial asset impairment

The Society assesses impairment of all its financial assets measured at cost or amortized cost. When there is an indicationof impairment, the Company determines whether it has resulted in a significant adverse change in the expected timing oramount of future cash flows during the year. If so, the Society reduces the carrying amount of any impaired financial assetsto the highest of: the present value of cash flows expected to be generated by holding the assets; the amount that could berealized by selling the assets; and the amount expected to be realized by exercising any rights to collateral held againstthose assets. Any impairment, which is not considered temporary, is included in the current year excess (deficiency) ofrevenue and expenses.

The Society reverses impairment losses on financial assets when there is a decrease in impairment and the decrease canbe objectively related to an event occurring after the impairment loss was recognized. The amount of the reversal isrecognized in the excess (deficiency) of revenue and expenses in the year the reversal occurs.


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3. Significant accounting policies (continued from previous page)

Property and equipmentProperty and equipment are recorded at cost. Donated property and equipment are recorded at fair market value at the dateof contribution. Amortization is reported in the Capital Fund and is recorded using the straight-line method at the followingannual rates, intended to recognize the cost of the assets over their expected useful lives. In the year of acquisition,amortization is taken at one half the standard rates:

Buildings and landscaping 5% - 10%Equipment and furniture 20%Automotive equipment 15%

Revenue recognitionRestricted contributions related to general operations are recognized as revenue of the General Operating Fund in the yearin which the related expenses are incurred. All other restricted contributions are recognized as revenue of the appropriaterestricted fund, or if no restricted fund exists, they are recognized in the General Operating Fund using the deferral methodof accounting.

Unrestricted contributions are recognized as revenue of the General Operating Fund in the year received or receivable if theamount to be received can be reasonably estimated and collection is reasonably assured.

Programs and services and fee for service revenue are recognized when the related service is provided.

Investment income includes dividends, interest income, and realized and unrealized investment gains and losses, which isrecognized as revenue of the General Operating Fund when earned.

Donated services and materialsDonated services and materials are recorded in the financial statements at fair market value when fair market value can bereasonably estimated and when these items would have otherwise been purchased. The Society’s programs benefit fromsubstantial services in the form of volunteer time, which is not recorded in the Society’s financial statements, because of thedifficulty in determining their fair value.

Foreign exchangeTransaction amounts denominated in foreign currencies are translated into their Canadian dollar equivalents at exchangerates prevailing at the transaction dates. Carrying values of monetary assets and liabilities reflect the exchange rates at thebalance sheet date. Gains and losses on translation or settlement are included in the determination of excess of revenue overexpenses for the current period.

Income taxesThe Society is registered as a charitable organization under the Income Tax Act (“the Act") and as such is exempt fromincome taxes and is able to issue donation receipts for income tax purposes. In order to maintain its status as a registeredcharity under the Act, the Society must meet certain requirements within the Act. In the opinion of management, theserequirements have been met.

Use of estimatesThe preparation of financial statements in conformity with Canadian accounting standards for not-for-profit organizationsrequires management to make estimates and assumptions that affect the reported amounts of assets and liabilities anddisclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue andexpenses during the reporting period. Accounts receivable are stated after evaluation as to their collectability and anappropriate allowance for doubtful accounts is provided where considered necessary. Provisions are made for slow movingand obsolete inventory. Amortization is based on the estimated useful lives of property and equipment.

These estimates and assumptions are reviewed periodically and, as adjustments become necessary they are reported in theexcess of revenue and expenses in the periods in which they become known.



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4. Inventory

The cost of inventory recognized as an operating expense amounted to $150,038 (2011 - $168,786).

5. Marketable securities

Marketable securities are recorded at market value. At December 31, 2012 the cost of the investments was $7,575,511 (2011- $6,970,606).

6. Property and equipment

CostAccumulatedAmortization

2012Net Book

Value

2011Net Book

Value

Land 1,550,000 - 1,550,000 1,550,000Buildings and landscaping 9,260,798 3,062,139 6,198,659 6,618,105Equipment and furniture 1,185,820 965,990 219,830 284,514Automotive equipment 163,838 140,035 23,803 38,251

12,160,456 4,168,164 7,992,292 8,490,870

7. Accounts payable and accrued liabilities

Included in accounts payable and accrued liabilities is $10,040 (2011 - $10,727) relating to source deductions payable.

8. Unrestricted fund balances2012 2011

Balance, beginning of year 667,110 818,844Excess of revenue over expenses 1,036,232 634,532Transfer to capital fund (645,085) (731,675)Transfer from restricted fund - 740Transfer to emergency fund (10,165) (87,170)Transfer from externally restricted funds 50,724 31,839

Balance, end of year 1,098,816 667,110

9. Restricted for endowment purposes

The amount restricted for endowment purposes is a bequest from Gordon Wright, which has an externally imposedrestriction that the resources be maintained in perpetuity.


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10. Restricted funds

a) Externally restricted funds:

Expenses from the restricted funds are required to be used as follows:

Alberta Gaming and Liquor Funds: restricted for use as per gaming licenses

Phoebe and Joan Snyder Education Fund: to promote humane attitudes towards animals through media advertisingand the violence prevention program.

ARC Resources Fund - to subsidize tuition fees which allow children to attend Humane Education summer andwinter day camps that otherwise would not be able to.

2012 2011

Alberta Gaming and Liquor Funds 21,671 72,395Phoebe and Joan Snyder Education Fund 117 117ARC Resources Fund 4,260 4,260

26,048 76,772

During the year $50,724 was transferred from the Alberta Gaming and Liquor Funds to the unrestricted fund (2011 -$31,389 was transferred from the unrestricted to the Alberta Gaming and Liquor Funds)

There was no change in the Phoebe and Joan Snyder Humane Education Fund during the year (2011 - $nil).

There was no change in the ARC Resources Fund during the year. In 2011 $4,260 was transferred to the ARC fund.

b) Internally restricted funds:

These amounts are internally restricted by the Board of Directors to be held for the following purposes:

2012 2011

Emergency Fund 1,432,335 1,422,170Estate of Dr. Robert Lundberg 5,432,003 5,432,003Capital Fund 1,341,580 815,399

8,205,918 7,669,572

In 2012, the Board of Directors transferred $10,165 to the Emergency fund (2011 - $87,170). The Emergency Fund isintended to finance the Society for three months of operations.

In March 2008, the Board of Directors approved a motion to internally restrict all funds received and expected to be receivedfrom the Estate of Dr. Robert Lundberg for the purpose of achieving the strategic goals of the Society.

The Capital fund represents amounts internally restricted for acquisition of property and equipment. During the year$645,085 was transferred to the Capital Fund (2011 - $731,675).



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11. Fundraising expenses

As required under The Charitable Fundraising Act of Alberta, the Society reports that $239,027 was paid as remuneration toemployees primarily responsible for fundraising in the year ended December 31, 2012 (2011 - $250,046).

12. Financial instruments

The Society, as part of its operations, carries a number of financial instruments. It is management's opinion that the Society isnot exposed to significant interest rate, currency or credit risks arising from these financial instruments except as otherwisedisclosed.

Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because ofchanges in foreign exchange rates.

The Society enters into investment transactions denominated in United States currency for which the related revenue,expenses, cash and marketable securities balances are subject to exchange rate fluctuations. As at December 31, 2012,foreign denominated cash and marketable securities were as follows:

2012CAD

2011CAD

Cash 130,884 152,282Marketable securities 1,646,135 1,263,204

In seeking to manage the risks from foreign exchange rate fluctuations, the Society closely follows exchange rates andmanagement monitors investment performance monthly. A 1% increase in foreign exchange rates would decrease cash by$1,309 (2011 - $1,523) and marketable securities by $16,461 (2011 - $12,632), resulting in a decrease of revenue overexpenses of $17,770 (2011 - $14,155).

Interest Rate Risk

Interest rate risk is the risk that the fair value of a financial instrument might be adversely affected by a change in the interestrates. Changes in market interest rates may have an effect on the cash flows associated with some financial assets andliabilities, known as cash flow risk, and on the fair value of other financial assets or liabilities, known as price risk. The Societyis not exposed to significant interest rate risk.


Notes:


DEANNA STEBLYK, CHAIR / DALE SUTHERLAND, VICE CHAIR / PAM BARBER, SECRETARYSUSAN SIMPSON, TREASURER / MARK TAKHAR, EXECUTIVE DIRECTOR

CATHY BJORNDALEN, DIRECTOR / DR. DREW VAN NIEKERK, DIRECTOR / ANNE HOBBS, DIRECTORJIM DAVIDSON, DIRECTOR / TRISH RICCIO, DIRECTOR / HEATHER EDWARDS, DIRECTORSUE SCULLY, DIRECTOR / DR. MIRIAM CAREY, DIRECTOR / JUDITH DWARKIN, DIRECTOR

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