1
Annual Report 73rd Annual General Meeting Monday, March 7, 2016 Vermilion Regional Centre, Vermilion, Alberta Registration – 6:30 p.m. Business Meeting – 7:00 p.m. Refreshments & Snacks to Follow
2
2015 Annual Report
at the 73rd Annual Meeting
Agenda Registration: 6:30 p.m. Program:
7:00 p.m.
Table of Contents
Welcome Introduction of Guests, Officers and Head Table Staff Long Term Service Awards Quorum
Page 1
Mission Statement/Values/Vision
Page 1
Table of Contents
Page 2
Annual Meeting Agenda
Page 2
Community Involvement & Support
Call to Order Approval of Agenda Presentation of Minutes of the Annual General Meeting
Notice of Meeting
72nd
Page 3-7
New Products
Page 8
Board of Directors
Page 9
Employee Service Awards
Page 10
Business Arising from the Minutes
Management and Staff
Page 11
Operations Report to the Membership
72nd Annual Meeting Minutes March 2, 2015
Nominating Committee Report
Page 12-16
Audit and Finance Committee Report
Board Chair’s Message to Membership
Page 17
Credit Committee Report
Operations Report to Membership
Page 18
Community Sponsorship
Financial Summary
Page 19
Resolution #1
Nominating Committee
Page 20
Auditor’s Report and Financial Statement
Audit & Finance Committee Report
Page 21
Credit Committee
Page 22
New Business Adjournment Refreshments & Snacks
Community Sponsorship Resolution #1 Financial Statements
Page 23-24 Page 25 Page 26-33
3
To Commemorate our We contributed $1,000.00 each to 15 organizations within our Community. Thank you to our Corporate and Prize Sponsors, our Volunteers, Staff and Golfers for their generous support and dedication.
Baking Robots Clandonald Parent Advisory (Hot Lunch Program) Innisfree Ukrainian Dancers Islay Health Centre Auxiliary Society Mannville 4-H Clubs Mannville Care Centre Mannville Community Fitness Centre Mannville Historical Society
Mannville/Vermilion Highland Dance St. Jerome’s Breakfast Program Vermilion 4-H Horse Club Vermilion Minor Ball Vermilion Nordic Ski Club Vermilion Play Development Vermilion Soccer Association
4
Fat Cat Certificate Recipients of a $100 bill - 2 students, chosen by their school for excellent participation in the Accelerated Reading Program
Daniel Sawkew & Jillayne Needham St. Jerome’s Separate School
Alexis Garnier was the lucky winner of both $100 draws Clandonald School
Neil Wiebe & Jordan Mitchell of Mannville School
Teyha Gould & ZiQi Shang Vermilion Elementary School
5
Our Bulletin Board of Thank You’s Community Support & Involvement
6
Our Community Support/Staff Involvement
Hot Lunch Programs Lakeland College Awards
Meals on Wheels
Anti-Bullying
Vermilion Fair Parade
The Baking Robots
7
Community Involvement/Fun Stuff/Staff Participation
Anti -Bullying Mannville School Accelerated Reading Celebration
Minburn Innisfree 4-H Show& Sale
Mannville Kindergarten Tour Clandonald Fair
Mannville Historical Society Pancake Breakfast
Canada Day Celebrations
Santas Anonymous Board, Staff, and VCU Donation $1,690
8
Exciting New Products Deposit Anywhere
Mobile App
New Member Cards
It’s here... Our new MemberCard debit card with Chip, and INTERACƗ Flash
9
Our Board of Directors The Board of Directors of Vermilion Credit Union Limited were pleased to announce the distribution of $424,375 in common share dividends and patronage rebates from 2015 profits. Our Credit Union has returned over 4 Million Dollars since the program inception year of 1999
Left to Right: Devon Whitten - Vice Chair, TJ Hinton, Maxine Sweeney, Willow Jaremco, Ryan Gibson, Sonia Matichuk, Larry Bingham - Chair, Charlene McFarlane,
Wayne Wright
10
Employee Service Awards 10 Years
15 Years Brenda Jackson
Alta Matters
Dorie Jackson
Gail Ruttan
Janice Mulgrew
20 Years – Connie Wilkinson
25 Years – Laura Tyner
11
Vermilion Credit Union Ltd. Management & Staff
Management David Eremko Laura Tyner Trina Fisher Mike Myhovich Roselyn Sikora Brenda Jackson Lyle Worobec
Chief Executive Officer Manager Lending Services Manager of Operations Mannville Branch Manager Manager Finance and Control Assistant Manager Lending Services Manager Financial Planning
Vermilion Branch Staff Darlene Balash Erinn Baldwin Carrie Barlow Laurie Barlow Skyler Brown Wanda Evans Christa Grocock Mitzi Isley Dorie Jackson Jodi Jones Alta Matters Alysha McNicol Janice Mulgrew Elaine Poliakiwski Corrine Rehmann Louella Schneider Bailey Snelgrove Tammy Snelgrove Ashton Stuparyk Carol Therrien Makinley Weber Tanya Westling Connie Wilkinson
Account Officer Member Service Officer - Casual Deposit Administrative Clerk Accounting & Finance Admin Officer Junior Account Manager Investment Officer Member Service Supervisor Loan Admin Clerk - Security Receptionist Account Manager Loan Admin Clerk - Audit Member Service Officer/Investments Marketing Coordinator Member Service Officer - Job Share Account Officer Member Service Officer - Job Share Investment Officer Loan Admin Clerk - Documentation Member Service Officer Member Service Officer - Casual Member Service Officer Member Service Officer Finance Admin/Investments
Mannville Branch Staff Dawn Jackson Rebecca Hochhausen Gail Ruttan Holly Staden
Senior Member Service Officer Member Service Officer Member Service Officer - Casual Member Service Officer - Casual
12
Minutes of the 72ND Annual Meeting Welcome: Devon Whitten introduced himself and welcomed everyone to the72nd Annual Meeting. Introduction of Guests: Devon Whitten requ ested that the guests stand for introductions. Sean Lesy, Chief Investment Officer Alison Starke, Board Chair Wilmer Rempel, Manager, Regulation and Credit Risk Assessment Mickey Mikkelson, Account Executive Dr. Richard Starke, MLA Jim Jackson, Councilor Steve Friend, CEO Bruce Weinkauf, Sr. VP Operations Garth Bradley, VP of Credit Shirley Mayowski, VP of Finance Judy Cabay, Board Vice Chair Joe Mohan, Sr. VP Operations Ray Styranka, VP Credit Amy Gertsma, VP Information Services
Alberta Central Alberta Central CUDGC CRI Canada Vermilion -Lloydminster Village of Mannville Vision Credit Union Vision Credit Union Lakeland Credit Union Lakeland Credit Un ion Lakeland Credit Union Vision Credit Union Wainwright Credit Union Wainwright Credit Union
Introduction of Officers: Devon Whitten introduced the head table and the Board of Directors . Introduction of Staff: David Eremko, CEO introduced the Management and Staff and had them stand as a group. Presentations to the Staff: - David Eremko Christa Grocock – 5 Years Mitzi Isley – 5 Years Nicole Warman – 5 Years Brian Hodgson – 30 Years
Mike Myhovich – 10 Years Carol Th errien – 10 Years (was unable to attend) Lyle Worobec – 10 Years
Quorum Report: - Larry Bingham Larry Bingham reported 57 members and 14 guests in attendance which represents a quorum. He then called the meeting to order at 7:10 p.m.
13
Approval of Agenda: Larry Bingham moved for the Agenda to be accepted as presented. Seconded by Brian Hodgson. All in Favor. Carried. Presentation of Minutes from 71st Annual Meeting: David Eremko moved to adopt the minutes as presented. Gail Ruttan seconded. All in Favor. Carried. Business Arising from the Minutes: There was no business arising from the minutes. Operational Reports: Larry Bingham, Chairman of the Board Larry Bingham, Chairman of the Board, referred to his report and described the challenge of the low interest rate environment and how our Credit Union adapted with another successful year. Larry Bingham highlighted areas, such as the renewed demand in the Loan Portfolio, Net Income showing a 20% increase over the previous year, and the return of $378,885 to the membership in common share and dividend payouts. Larry reported that the Board of Directors continues to place strong emphasis on training and he was pleased to report that the present Board average age is lower than before, which he finds encouraging, going forth into future years of the Credit Union. Larry Bingham said that the Strategic Planning Session, held yearly, is attended both by Directors and the management team and provides a great opportunity to look back at the past, welcome change in the future and to define what the long term goals and vision of the Credit Union will be. Larry reported a welcome change to the Strategic Planning Session by having a Facilitator conduct the session and therefore providing more insights for all in attendance. In closing, Larry Bingham thanked the management team and staff for controlling expenses and providing a secure loan portfolio. David Eremko, CEO David Eremko, CEO thanked everyone for venturing out and braving the cold to share their evening with us and continued by thanking the members for their continued support and endorsement of our Credit Union. While referring to his report, David said that Asset Growth, Deposits, Income before Allocations and Taxes, Net Income, Capital and Retained earnings all improved from last year; reflecting positive growth. David indicated that we have had consistent member growth with good advancement in our youth membership, which bodes well for our Credit Union in the years ahead. David then reported that our credit union is focused on technology with the addition of two ATM’s, Fraud Detection software, improved banking forms, as well as the fact that we are presently working on obtaining a mobile banking app and a Remote Deposit Capture service.
14
David commented on the general negative tone of our economy with regard to the oil industry and said that we will continue to promote the safeguarding of the membership. In closing, David thanked everyone for coming, thanked the management, staff and directors. David Eremko moved the Operational Reports for acceptance. The Operational Reports were seconded by Michael Myhovich. All in favor. Carried. Nominating Committee Report: Devon Whitten, Chair of the Nominating Committee, stated that each year there are three Directors whose terms expire and named these Directors as Larry Bingham, Sonia Matichuk, and Maxine Sweeney. Devon reported that the call for nominations notice was published in the Vermilion Standard, Vermilion Voice as well as posted in branch and on the website. There were no new nominees, however; Larry, Sonia and Maxine graciously agreed to complete another term and therefore; were elected by acclamation. In closing, Devon Whitten thanked and was grateful to Larry Bingham, Sonia Matichuk and Maxine Sweeney for allowing their names to stand. Devon Whitten moved that the Nominating Committee Report be accepted. Dorie Jackson seconded the motion. All in Favor. Carried. Audit and Finance Committee Report: Willow Jaremco, Audit and Finance Committee, presented the report on behalf of Sonia Matichuk, who is the Chair of the Committee. Willow reported that the Audit and Finance Committee met independent of the CEO and management, with Credit Union Central of Alberta and Hawkings Epp Dumont to discuss and review the audit process after each audit. Both Credit Union Central and Hawkings Epp Dumont were able to provide position feedback and a clean opinion. In closing, Willow thanked the management and staff for their efforts in producing great audit results. Willow Jaremco moved the report for acceptance. Seconded by Wayne Wright. All in Favor. Carried. Credit Committee Report: Brian Hodgson, Manager Lending Services, confirmed the members of the Credit Committee as being, David Eremko, Brenda Jackson, Michael Myhovich, Roselyn Sikora, Laura Tyner and himself. Brian provided information as he presented statistics for the Lending Department and highlighted that all areas of lending show an increase, with a very low delinquency rate of .09% , representing a dollar value of $113,000. Brian Hodgson moved that the Credit Committee Report be accepted. Lyle Worobec seconded the motion. All in Favor. Carried.
15
Community Sponsorship: While referring to the PowerPoint presentation, David Eremko said that Vermilion Credit Union has donated over $35,000 to various organizations in our surrounding communities and that the staff worked over 1000 volunteer hours during the past year. David Eremko said that our participation in the Fat Cat Accelerated Reading Program within our 4 local schools continues to be of major importance. David went on to say that this program is an annual commitment and the Credit Union donated $6,545 in 2014 which allows schools to purchase reading material for the students, encouraging them to read. David added that we held our 14th Annual Charity Golf Tournament; with the beneficiaries being Innisfree Public Library, Mannville Centennial Library and the Vermilion Public Library each being awarded $3,500. David was appreciative of the tremendous support from the sponsorship, from golfers, those who participated, plus the efforts of staff and volunteers for this very worthwhile event. Auditors’ Report and Financial Statement: Michael Epp, CA of Hawkings Epp Dumont began his presentation speaking of the current state of affairs within Alberta and said that his firm works with Credit Unions throughout the Province, including cities and rural towns. Michael stated that it’s hard to even read the news as our Alberta, once having endless opportunities, is now going through tough times. He continued in saying that the positive side after the 50% tumble since June of 2014, the predicted mild recession of 2015 and with home sales down, that the “East”, being Ontario and Manitoba are now beginning to prosper. However; with the inventory decline, the demand is positive and the markets are calm, believing that we are “Suffering temporary pain for long term gain”. Michael continued by giving account of an Alberta family man’s struggle who had just been laid off from his position within the oilfield, who told him that he is curbing spending and concentrating just on the survival of his family. Michael then added that this man could be the spouse of an employee or a member of Vermilion Credit Union and we need to stand by both, which is why the Credit Union involvement in their community, plus their local decision making, has such a huge impact on the people who live within. Michael said that Trevor Dodd has recently became a partner in the company and has played a role in the audit service at Vermilion Credit Union and then thanked Roselyn Sikora, Manager of Finance, Brian Hodgson, Manager of Lending, David Eremko, CEO and all staff for their assistance and sound practices. Michael, then “shed light on the numbers” while referring to his PowerPoint presentation by beginning with Assets, Loans to Members, Member Deposits, Financial Margin Trend, Other Income, Operating Expenses Trend, Operating Expenses as a percentage of Assets, Net Income before Patronage allocation and Income Tax, Patronage & Dividends and ended with Member’s Equity and accentuated on how well managed the expenses of this Credit Union are. In closing, Michael congratulated the Vermilion Credit Union on a successful and respectable year with a clean audit and said that we all must forge ahead, rein in our expenses and adjust to the life style for our new journey and wished all the best for 2015.
16
Devon Whitten moved for the Approval of the Auditors’ Report and Elaine Poliakiwski seconded the Auditors’ Report. All in Favor. Carried. New Business: Devon Whitten asked if there was any new business arising and there was none. Thank You’s – David Eremko thanked all presenters and guests for attending, the caterer, the long term staff for their commitment and the management and staff for setting up for the AGM. David then explained the door prize procedure and thanked Celero, CRI Canada and Hawkings Epp Dumont for their door prize donations. Adjournment: Devon Whitten adjourned the Annual General Meeting at 7:45 p.m.
17
Board Chair’s Message to the Membership The on-going low interest rate environment continues to present our institution with challenges. The management and staff of our Credit Union have dealt with this business environment very successfully. The Vermilion Credit Union achieved excellent results during the past year of operations. The downturn in our local economy beginning in 2015 was evident in a somewhat lower rate of increase in member deposits. Fortunately the slower growth on the deposit side of the business was offset by increased growth in loan demand. Loans increased by more than 5% over the course of the fiscal year. Operating expenses rose by 3% compared to the previous ye ar. Revenues grew sufficiently to offset the rising expenses. Net i ncome increased by approximately $17,000, in spite of the fact that the dividend from Credit Union Central was approximately 26% lower than the previous year. The Credit Union returned more than $424,000 to its members in the form of patronage rebates and dividends on common shares. That is a very significant contribution to the local economy, and is in accordance with our long standing policy guidelines in this area. During the past year, the Board of Directors continued our emphasis on director training as a way of increasing our effectiveness in fulfilling our duties. All of our current directors have met the training standards outlined in our policy. We have an energetic and engaged group of Directors who take an active role in formulating the strategic direction of our Credit Union. I find this to be a very encouraging prospect for this Credit Union as we move forward. In June of 2015, Directors and Management participated in our annual strategic planning session. This enabled us to identify both the challenges and the opportunities the Vermilion Credit Union faces. The facilitated workshop was a very positive experience for the Board and Management Team, and we intend to build on the goals identified during the planning session. The continued depression in the energy sector is of concern to us, but we feel that the balanced nature of our Credit Union’s business will help mitigate potential negative effects. The agricultural, commercial, and consumer sectors of our business provide the necessary balance . We continue to appreciate the ability of our management team in managing operating expenses, achieving a commendable net income, and in maintaining a very secure loan portfolio. We would also like to thank our members for their continued support and participation in our Credit Union. Respectfully submitted,
Larry Bingham
Chairman of the Board of Directors
18
Operations Report to the Membership Thank you to our membership and communities for your continued support and commitment to a better banking alternative that remains focused on providing community based financial services. The last number of months have been challenging for our members and community as the effects of a province wide economic slowdown have taken its toll both financially and personally. We admire the resiliency of our membership as they continue to weather this uncertain and troubling time in our lives. Profitability continued with net income of $1,033,985, a slight increase from the previous year end. Revenues, while up over the fiscal 2014, experienced pressure due to the continued downward movement of interest rates. Expenses were also up over 2014 but were below budget in all areas. This reflects the continued care and attention of the management team and staff to ensure sound and prudent financial management throughout the year. Capital and retained earnings increased to $15,592,701, which meets all provincial regulatory levels for capital and provides continued evidence of strength and security for our membership. The enclosed financial statement will provide further insight into the overall balance sheet and financial results generated by your credit union in the past year. Your credit union continues to focus on adopting technology that will improve the overall member experience, safety and convenience for all of our members. New product offerings saw tap enabled member debit cards, our new mobile banking app for smartphones, as well as remote deposit capture. Our board of directors, continue to provide sound judgment and guidance throughout the year. This is accomplished through ongoing strategic planning, board mandated training and a continued focus on the overall risk profile and of the credit union. To insure accountability and oversight by independent professional bodies, external audits are completed quarterly by Alberta Central and Hawkings Epp Dumont LLP. Thank you to our valued staff whose dedication and efforts have resulted in a positive and successful year for your Vermilion Credit Union.
David Eremko
Chief Executive Officer
19
Assets
Deposits
$200,000,000
$200,000,000
$150,000,000
$150,000,000
$100,000,000
Assets
$50,000,000
$100,000,000
Deposits
$50,000,000
$0
$0
2010 2011 2012 2013 2014 2015
2010 2011 2012 2013 2014 2015
Capital and Retained Earnings $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $-
Income before Allocations and Taxes
$1,400,000 $1,200,000 $1,000,000 $800,000 Retained Earnings $600,000 Common $400,000 Shares $200,000 $-
Income before Allocations
2010 2011 2012 2013 2014 2015
2010 2011 2012 2013 2014 2015
Net Income
Patronage/Dividend Payments to Our Members Thousands
$500,000 $400,000 $300,000
Patronage Dividends
$200,000 $100,000 $2010 2011 2012 2013 2014 2015
$1,200 $1,000 $800 $600 $400 $200 $-
Net Income
2010 2011 2012 2013 2014 2015
20
Nominating Committee Report The Vermilion Credit Union Limited Board of Directors is made up of 9 individuals that represent the body of members. Each year the term of 3 Directors expire. This year the terms of Maxine Sweeney, Devon Whitten and Wayne Wright expire. A call for nominations from the membership at large was published in the Vermilion Standard and the Vermilion Voice as well as in both the Vermilion and Mannville branches. As a result of these notices and the work of the Nominating Committee, a list of candidates for the Board of Directors was presented to the membership for consideration. In-branch balloting was then conducted from Feb 11, 2016 to Mar 3, 2016. The results of this election will be revealed during the Annual General Meeting on March 7, 2016 Maxine Sweeney has decided to step down from her position as Director after the completion of three terms. The Nominating Committee would like to express our appreciation to Toland Cochrane, Kellen Snelgrove, Devon Whitten, Patrick Willis and Wayne Wright for allowing their names to stand for election. We look forward to working with the successful candidates in the future.
Respectfully submitted,
Ryan Gibson
Chair of the Nominating Committee
21
Audit and Finance Committee Report During the past year, the Vermilion Credit Union Audit and Finance Committee consisted of Ryan Gibson, Willow Jaremco, Wayne Wright and myself, Sonia Matichuk. The Audit and Finance Committee met on four separate occasions to complete the tasks and responsibilities assigned to it by the board. The committee also reviewed Quarterly Financial Reports prepared by management prior to the board to ensure industry and Vermilion Credit Union benchmarks and goals are being met. On behalf of the board of directors, Credit Union Central of Alberta was engaged to complete Internal Audits for the first 3 quarters of the fiscal year, January, April and July. Hawkings Epp Dumont, the Credit Union’s external auditor, completed the Fourth Quarter Audit and the year-end Financial Statement as of October 31, 2015. The Audit and Finance Committee reviewed all audit reports along with management’s responses and were satisfied with the integrity of systems and controls, which are supported by all external bodies. Meetings were held independent of the CEO and management with Credit Union Central to discuss and review the audit process after each audit. Discussion was held throughout the year on the work of the Enterprise Risk Management committee as well as the credit union’s progress towards complying with the new capital requirements, which our credit union has fully met. On behalf of the Audit and Finance Committee, we thank the staff and management for all their efforts during this past year. The audit reports received are a result of their hard work and attention to following policies and procedures. Thank you to my fellow committee members, Board of Directors, management and staff. Respectfully submitted
Sonia J. Matichuk
Chair of the Audit & Finance Committee
22
Credit Committee Report As of October 31, 2015 the loan portfolio was $131,523,309, an increase of $6,722,005 or 5.39% from the last fiscal year end.
Member Loans Millions $150 $100 Loans
$50 $2010
2011
2012
2013
2014
2015
The overall increase in the portfolio is attributed to our residential mortgages and agricultural portfolios. Loan delinquency as of October 31, 2015 was at .01% of the total loans and authorized overdrafts, which were delinquent in excess of 60 days. This represents a total dollar value of $7,127.
Loan Portfolio Breakdown Oct 31/2015
$32,953,713 25%
$14,601,248 11% Consumer Residential Mortgages
$26,320,215 20%
$57,153,124 44%
Commercial Agricultural
Respectfully Submitted
Laura Tyner Manager, Lending Services
23
Our staff, management and directors take pride in the commitment Vermilion Credit Union gives to our community. During the 2015 fiscal year, donations were made to a number of organizations, clubs and groups in the Vermilion and surrounding area. We contributed over $42,000 through community sponsorship, donations, and event participation. Major recipients of financial contributions were the Vermilion, Mannville, Clandonald, and St. Jerome’s Elementary Schools in the amount of $6,665 for the Fat Cat Accelerated Program. One other major recipient was the 4-H Beef purchase in the amount of $1,975. This year was our 15th anniversary of our Annual Charity Golf Tournament. We were pleased to have raised $15,000 and 15 local organizations were recipients of $1,000 each. We are proud that our staff, for the 2015 fiscal year, volunteered in excess of 750 hours to sports teams, school events, and various other organizations within our communities.
Charity Golf Tournament Recipients Baking Robots Clandonald Parent Advisory (Hot Lunch Program) Innisfree Ukrainian Dancers Islay Health Centre Auxiliary Society Mannville 4-H Clubs Mannville Care Centre Mannville Community Fitness Centre Mannville Historical Society
Mannville/Vermilion Highland Dance St. Jerome’s Breakfast Program Vermilion 4-H Horse Club Vermilion Minor Ball Vermilion Nordic Ski Club Vermilion Play Development Vermilion Soccer Association
Sports Islay Curling Club Derwent Curling Club Mannville Curling Club Mannville Minor Hockey Mannville Riverview Golf and Recreation Society St Jerome’s School Carnival Vermilion Curling Club Vermilion Farm Curl Vermilion Golf Club Vermilion Jr. Curling Bonspiel
Vermilion Junior B Tigers Vermilion Lacrosse Vermilion Lions Club Charity Golf Tournament Vermilion Minor Hockey Vermilion Rotary Golf Tournament Vermilion Skating Club Vermilion Soccer Association
Educational Brighter Beginnings Clandonald School Awards Clandonald School Fat Cat Accelerated Reading Program Innisfree Delnorte School Awards J.R. Robson School Awards J.R. Robson Senior High School Awards Kiddie Oasis Lakeland College Awards
Mannville School Awards Mannville School Fat Cat Accelerated Reading Program St. Jerome’s School Awards St. Jerome’s School Carnival St. Jerome’s School Fat Cat Accelerated Reading Program The Baking Robots Vermilion Elementary School Fat Cat Accelerated Reading Program
24
Arts
Vermilion Allied Arts Council Vermilion Cinematic & Performing Arts Association Vermilion Community Art Club
Vermilion Music Festival Vermilion Ukrainian Cultural Association Vermilion Ukrainian Dance Association Vermilion Dance Festival
Clubs Clandonald Ag Society (Hay Clandonald) Lakeland Agility Club Lakeland Runaway Vermilion Army Cadets Vermilion Golf and Country Club
Vermilion Rotary Club Vermilion 4-H Sheep Club Vermilion 4-H Beef Club
Service Groups /Associations Etc. Auberndale Community Centre Citizens on Patrol Communities in Bloom Creighton Women’s Institute Derwent Ag Society Mannville Ag Society Mannville Chamber of Commerce Mannville Cops Society Mannville Fair Group Mannville Feeder Association Mannville Health Care Centre Mannville Welcome Wagon
Pathfinder Community Centre Pink Shirt Day The Good Life Institute Vermilion Ag Society Vermilion Chamber of Commerce Vermilion Heritage Museum Vermilion Legion Vermilion Lions Vermilion Rotary Vermilion Ukrainian Cultural Association
Events Alberta Professional Chuck wagon & Chariot Association
Border Cowboys Mounted Shooters Candy Cane Count Down Courage Canada Trail Ride Farm Curl
Home Expo Mannville Canada Days Vermilion Multiculturalism & Canada Days Women’s Conference
25
Resolution #1 SUBMITTED BY:
The Board of Directors of Vermilion Credit Union Limited
RESOLUTION:
Compensation Disclosure
WHEREAS:
Compensation of executive managers of the Credit Union is determined by members serving on the Board of Directors of the Credit Union, and
WHEREAS:
The Board of Directors in determining compensation considers such factors as market compensation surveys, the skills and responsibility of staff, and the financial resources and performance of the credit union, and
WHEREAS:
The Credit Union has not disclosed senior executive compensation in its financial statements in order to respect the confidentiality of the employment relationship with its staff and the personal security of those staff, and
WHEREAS:
The Province of Alberta in 1995 amended the Credit Union Act to cause credit unions to present to annual general meetings commencing in 1996, and at least every 5 years thereafter, a resolution that provided members the option of requiring the credit union to disclose the individual remuneration of its executive managers in its annual financial statements, and
WHEREAS:
A Resolution pursuant to the Credit Union Act was presented to the membership at the Annual General Meetings held in 1996, 2001, 2006, 2011 and our membership voted to not disclose executive managers compensation.
WHEREAS:
The following resolution is presented for the consideration of the members in accordance with the Credit Union Act and is subject to approval or rejection by a simple majority of the members.
NOW THEREFORE: BE IT RESOLVED THAT Vermilion Credit Union disclose the individual remuneration and benefits of the following of its executive managers as a notation to its annual financial statements in the form set out in Schedule 3 to the Credit Union (Principal) Regulation: -
CEO & General Manager Manager of Lending Services Assistant Manager Lending Services Manager of Finance & Control Manager Branch Operations Manager Financial Planning Mannville Branch Manager
26
27
INDEPENDENT AUDITORS' REPORT To the Members of Vermilion Credit Union Limited We have audited the accompanying financial statements of Vermilion Credit Union Limited, which comprise the statement of financial position as at October 31, 2015 and the statements of net income and comprehensive income, changes in member equity, and cash flows for the year ended October 31, 2015, and the related notes, which comprise a summary of significant accounting policies and other explanatory information. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, 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' Responsibility Our 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 controls 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 controls. 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. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of Vermilion Credit Union Limited as at October 31, 2015 and its financial performance and cash flows for the year ended October 31, 2015 in accordance with International Financial Reporting Standards.
Edmonton, Alberta January 28, 2016
Hawkings Epp Dumont LLP Chartered Accountants
28
MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL REPORTING These financial statements were prepared by the management of Vermilion Credit Union Limited (the "Credit Union") who are responsible for their accuracy, completeness and integrity. They were developed in accordance with the requirements of the Credit Union Act of Alberta and conform in all material respects with International Financial Reporting Standards. Systems of internal control and reporting procedures are designed to provide reasonable assurance that the financial records are complete and accurate so as to safeguard the assets of the Credit Union. These systems include establishment and communication of standards of business conduct throughout all levels of the organization to provide assurance that all transactions are authorized and proper records are maintained. Internal control provides management with the ability to assess the adequacy of these controls. Further, they are reviewed by the Credit Union's external auditors. The Board of Directors (the "Board") has approved the financial statements. The Board, comprising of nine directors who are not officers or employees of the Credit Union, has reviewed the statements with the external auditors, in detail, and received regular reports on internal control findings. Hawkings Epp Dumont LLP, the external auditors appointed by the membership, have examined the financial statements of the Credit Union in accordance with Canadian auditing standards. They have had full and free access to the internal audit staff, other management staff, and the Audit and Finance Committee of the Board. Their report appears herein.
29
VERMILION CREDIT UNION LIMITED STATEMENT OF FINANCIAL POSITION AS AT OCTOBER 31, 2015
2015
2014
ASSETS Cash and cash equivalents (Note 6) Investments (Note 7) Derivative assets (Note 20) Member loans (Note 8) Other assets Property and equipment (Note 10) Intangible assets (Note 11)
$ 32,015,367 $ 35,912,636 6,828,409 5,270,894 125,498 63,403 131,523,309 124,801,304 92,986 87,863 1,380,750 1,468,063 186,439 237,119 $ 172,090,663 $ 167,903,377
LIABILITIES Accounts payable and accrued liabilities Deferred income tax liability (Note 9) Derivative liabilities (Note 20) Income taxes payable Member deposits (Note 13) Allocation payable (Note 14)
$
216,098 $ 247,496 55,781 115,407 63,403 125,498 12,707 41,554 156,012,098 153,897,444 137,875 72,575 156,497,962
154,499,974
286,500 5,834,142 9,472,059
311,150 4,434,069 8,658,184
15,592,701
13,403,403
MEMBERS' EQUITY Allocation distributable (Note 14) Common shares (Note 15) Retained earnings
$ 172,090,663 $ 167,903,377
Commitments (Note 17)
ON BEHALF OF THE BOARD:
30
VERMILION CREDIT UNION LIMITED STATEMENT OF NET INCOME AND COMPREHENSIVE INCOME FOR THE YEAR ENDED OCTOBER 31, 2015
2015
2014
5,173,414 $ 362,705 60,308
5,103,983 393,262 82,787
5,596,427
5,580,032
1,452,616 1
1,560,996 514
1,452,617
1,561,510
4,143,810
4,018,522
51,073
11,879
4,092,737
4,006,643
933,490
918,429
NET INTEREST AND OTHER INCOME
5,026,227
4,925,072
OPERATING EXPENSES (SCHEDULE I) Personnel Occupancy Security Organization General
2,050,340 134,229 274,839 85,973 1,056,149
2,010,960 130,940 231,511 92,256 1,031,120
3,601,530
3,496,787
1,424,697
1,428,285
137,875
72,575
1,286,822
1,355,710
312,463 (59,626)
289,898 49,441
252,837
339,339
INTEREST INCOME Interest from member loans Investment income Patronage income
$
INTEREST EXPENSE Interest on member deposits Interest on financing
NET INTEREST INCOME BEFORE PROVISION FOR LOAN IMPAIRMENT PROVISION FOR LOAN IMPAIRMENT (NOTE 8) NET INTEREST INCOME AFTER PROVISION FOR LOAN IMPAIRMENT OTHER INCOME
INCOME BEFORE PATRONAGE ALLOCATION AND INCOME TAXES PATRONAGE ALLOCATION (NOTE 14) INCOME BEFORE INCOME TAXES INCOME TAXES (NOTE 9) Current Deferred (recovery)
NET INCOME AND COMPREHENSIVE INCOME
$
1,033,985 $
1,016,371
31
VERMILION CREDIT UNION LIMITED STATEMENT OF CHANGES IN MEMBERS' EQUITY FOR THE YEAR ENDED OCTOBER 31, 2015
Allocation Distributable Balance, October 31, 2013
$
Net income Dividends paid through issuance of member shares Dividends accrued Income tax recovery, dividends declared Issuance of member shares Redemption of member shares Balance, October 31, 2014
Net income Dividends paid through issuance of member shares Dividends accrued Income tax recovery, dividends declared Issuance of member shares Redemption of member shares Balance, October 31, 2015
$
160,300 $
Retained Earnings
Member Shares 4,528,624 $
Total
7,879,459 $ 12,568,383
-
-
1,016,371
1,016,371
(160,300) 311,150 -
155,656 70,919 (321,130)
4,644 (311,150) 68,860 -
68,860 70,919 (321,130)
311,150
4,434,069
8,658,184
13,403,403
-
-
1,033,985
1,033,985
(311,150) 286,500 -
314,041 1,249,017 (162,985)
(2,891) (286,500) 69,281 -
69,281 1,249,017 (162,985)
5,834,142 $
9,472,059 $ 15,592,701
286,500 $
32
VERMILION CREDIT UNION LIMITED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED OCTOBER 31, 2015
2015 OPERATING ACTIVITIES Interest received from member loans Interest received from investments Dividends received Other income received Patronage income received Interest paid to members Income taxes paid Net operating expenses paid Patronage allocation paid Net change in member loans Net change in investments Net change in member deposits
$
2014
5,130,043 $ 5,126,282 325,210 391,253 43,200 32,000 933,490 918,429 60,308 82,787 (1,391,791) (1,802,762) (272,029) (176,068) (3,470,058) (3,255,331) (72,575) (73,835) (6,729,707) (10,195,633) (1,563,220) 12,858,511 2,053,829 7,337,363 (4,953,300)
11,242,996
(30,000) -
(118,864) (11,510)
(30,000)
(130,374)
1,563,058 (162,985) (314,041) (1)
226,575 (321,130) (155,656) (514)
1,086,031
(250,725)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(3,897,269)
10,861,897
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
35,912,636
25,050,739
INVESTING ACTIVITIES Purchase of property and equipment Purchase of intangible assets
FINANCING ACTIVITIES Issue of member shares Redemption of member shares Dividends on common shares Interest paid on financing
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 32,015,367 $ 35,912,636
33
VERMILION CREDIT UNION LIMITED SCHEDULE I SCHEDULE OF OPERATING EXPENSES FOR THE YEAR ENDED OCTOBER 31, 2015
Personnel Salaries Benefits Training and other
$
Occupancy Repairs and maintenance Depreciation Utilities Property taxes
Security Deposit guarantee assessment Bonding Insurance
Organization Central dues Directors' fees Directors' expenses Other
General Computer, cash and service charges Office Depreciation Courier and postage Office equipment, rental and maintenance Advertising and community support Professional fees Amortization of intangible assets Telephone Travel Loan associated expenses Insurance Loss on disposal of property and equipment
$
2015
2014
1,726,870 $ 234,891 88,579
1,708,989 224,739 77,232
2,050,340
2,010,960
40,593 35,400 32,972 25,264
39,831 35,400 31,461 24,248
134,229
130,940
249,850 21,412 3,577
205,540 24,449 1,522
274,839
231,511
46,137 15,500 14,021 10,315
43,808 15,350 18,384 14,714
85,973
92,256
456,388 125,105 77,085 74,629 61,035 59,091 53,800 50,594 35,245 21,991 19,166 17,168 4,852
453,415 111,189 67,153 94,886 52,891 67,545 48,283 50,399 33,229 17,407 14,697 16,919 3,107
1,056,149
1,031,120
3,601,530 $
3,496,787
34
Notes
______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________
35
36
