In June 2006, PSAB approved PS 3150, which requires municipalities to report Tangible Capital Assets (TCA) on their Statement of Financial Position (i.e. balance sheet) effective January 1, 2009. It also requires a new format for municipal financial statements and requires that tangible capital assets be amortized on the Statement of Operations (i.e. income statement). Source Ministry of Municipal Affairs and Housing http://www.mah.gov.on.ca/page6677.aspx
What is a “tangible capital asset”? | What impact will TCA accounting have on the Region of Peel’s MPMP performance reporting? | What is amortization (depreciation)? | Why is there a need to report these assets differently now? | Are there any other changes to annual reporting requirements?
is MPMP? | Will
any new services be added to expand the MPMP program?
does municipal benchmarking benefit the Region
of Peel? | How
does the Region of Peel compare to other municipalities?
the provincial government reporting MPMP results
from across the Province of Ontario?
I want to know more about MPMP who can I contact?
is the Region of Peel contact regarding MPMP?
What is a “tangible capital asset”?
Tangible capital assets are non-financial assets having a physical substance with economic lives that extend beyond the current year. For governments they are a key component in the delivery of programs and the provision of services. The following are some of the major classes of tangible capital assets (TCA) that support basic municipal services.
- road networks
- fleet and equipment
- waste management facilities and landfill sites
- general purpose buildings
- land for providing municipal services
- water and wastewater plants
- water and wastewater networks
- information technology software and hardware
- furniture and fixtures
What impact will TCA accounting have on the Region of Peel’s MPMP performance reporting?
The Region is now required to include the costs of capital maintenance, reported as capital expenditures in prior years, as part of our operating costs. For some program areas, this has made a significant impact in the costs reported for 2011.We are also required to add amortization (depreciation) and interest on long-term debt to operating costs and subtract Revenue from other Municipalities for Tangible Capital Assets. To reflect this we have included two costs measures, one for operating costs and one that is the total of operating costs and amortization and interest on long term debt called “Totals Costs”.
What is amortization (depreciation)?
Amortization is the cost of a tangible asset attributed to the current year. Amortization allocates the cost of acquiring an asset over the estimated number of years the asset will be in service.
Why is there a need to report these assets differently now?
As the existing capital asset base ages and population grows, increased demands for new capital assets will place further pressures on the ability of a local government to sustain those services. Information about the existing stock, the cost of its use and the needs for its replacement must be at the forefront of decision making.
With the introduction of TCA Municipal accounting practices are now consistent with financial reporting at the Provincial and Federal levels.
Are there any other changes to annual reporting requirements?
What is MPMP?
The Municipal Performance Measurement Program (MPMP) is an initiative introduced by the Ontario Government in October 2000 to provide taxpayers with useful information on service delivery and to give municipalities a tool to improve those services over time. Objectives of the program are:
- to provide a tool to assess how well municipal services are delivered
- to improve performance: measuring the efficiency (cost) and effectiveness (quality) of local services
- to strengthen local accountability to taxpayers and promote greater understanding of municipal responsibilities by the taxpayer, and
- to provide a systematic resource that allows municipalities to share information on performance and learn better or new practices from each other.
Will any new services be added to expand the MPMP program?
Now that the program is well underway, the province plans to gradually add new service areas to the performance measures collected by MPMP. New measures introduced for the 2011 reporting year are: For 2011, there are no new measures that affect the Region of Peel.
How does municipal
benchmarking benefit the Region of Peel?
The practice of benchmarking allows performance statistics to be shared and operational best practices to be identified and adopted. The Region of Peel benefits from benchmarking because it provides a framework that leverages improvements in municipal services.
How does the Region of
Peel compare to other municipalities?
The Region is a firm believer in benchmarking and uses performance measurements to guide improvements in its own services over time. Peel does not specifically use MPMP results to compare itself to other municipalities as results are influenced by a number of factors including: service responsibility, population density, urban versus rural, geography, accessibility and others.
Is the Provincial
Government reporting MPMP results from across
the Province of Ontario?
The most current report of provincewide MPMP results are available on the website.
If I want to know
more about the MPMP who can I contact?
For more information about MPMP across Ontario
you can visit the Ministry of Municipal Affairs
and Housing website at www.mah.gov.on.ca
Manager Municipal Performance and Accountability
Ministry of Municipal Affairs and Housing
Who is the Region
of Peel contact regarding MPMP?
For more information about the Region,
Manager, Business Improvement & Solutions
Corporate Services, The Region of Peel
Tel: 905-791-7800, ext. 4387