Each year the Alma Mater Society of Queen’s University Incorporated (AMS) prepares a financial statement which is intended to reflect the activities of the Corporation as at, and for the year-ended, April 30th.  This financial statement is then subject to an independent audit by a public accounting firm.   The result is a summary of the assets, liabilities, reserves, fund balances and operations of the corporation for the fiscal year.

Copies of the complete audited financial statement may be obtained from the AMS general office and on the web at http://www.ams.queensu.ca.  Excerpts from the financial statements are included here to draw attention to some of the more significant information contained therein.  What follows is a brief summary of the contents of the audited financial statement, which should serve as a guide for the inexperienced reader of such documents.

Auditors’ Report

As previously discussed, the Alma Mater Society’s books are subject to an annual audit by an independent accounting firm (KPMG, in this case).    This audit is intended to provide reasonable, but not absolute, assurance that the financial statements are free of material error.  This does not mean that the financial statements do not contain errors, but rather that they contain no errors which would significantly impact on decisions made by the “stakeholders” of the AMS.

The audit procedures include examining, on a test basis, the evidence supporting amounts and disclosures in the financial statements.  It also includes assessing the accounting principles used in constructing the financial data and ensuring that those principles are both appropriate in the circumstances and consistently applied.

That said, the 2008 audit report by KPMG is a “clean” or unreserved opinion, meaning that the auditors were able to satisfy themselves that the above conditions were satisfactorily met.

Balance Sheet

The balance sheet is commonly described as a “snapshot” of a firm at a particular point in time.  It provides an opportunity to examine the financial soundness of the firm (the ability of the corporation to cover its debts) and the manner in which the firm is using its assets to earn income.

The balance sheet is divided into three main sections - assets, liabilities and net assets:

Assets: An asset is something which is expected to provide benefit to the firm now or in the future.  Assets are listed on a balance sheet in order of liquidity (i.e. ease with which the asset can be converted into cash).  A review of the AMS balance sheet shows a high level of assets held in the form of cash or near-cash items.  Capital assets are recorded at historical cost and are depreciated (charged to operations) over a period of time determined by the Board of Directors.

Liabilities: A liability is something which entails future obligation.  As with assets, liabilities are segmented between obligations which will come due in the short-term (current liabilities) and those which will come due in the long-term.  The liabilities of the AMS  consist of amounts due to suppliers, government agencies and amounts held by the AMS on behalf of other non-AMS groups.

Net assets: Equity is the residual after deducting liabilities from assets.  In essence, it represents the “net worth” of the company.  The equity section of the AMS balance sheet is divided into a number of components.  The operating fund represents the accumulated profits and losses from operations of the AMS over its history.  It is increased (or decreased) annually by the net income (or loss) from the operation of AMS services and commissions.  Over the years the Society has appropriated funds for specific services or projects.  These are known as reserves and are disclosed in the equity section of the balance sheet.  Finally, the AMS has established internally restricted funds to handle the flow of money through projects outside normal operations (the Accessibility Queen’s Fund, Advantage FundHealth and Dental Plans Fund, Student Centre Fund, and the Journal House Fund).  The reported balance represents the amounts segregated by the AMS to be used for those specific purposes.

Statement of Operations

The statement of operations provides a summary of the revenues and expenses for a corporation for a given period.

For the year-ended April 30, 2008, the AMS reported a net loss from operations of $106,640.  This figure is broken down further on the schedules of Service, Other Corporate, and Government Revenues and Expenses included in this package.  The schedules disclose revenues and expenses by service or commission and arrive at a “net contribution” to the overall deficit of $106,640 for the year.

Statement of Changes in Net Assets

The statement of changes in net assets provides the continuity between beginning of period fund balances and end of period balances.

The AMS operating fund and net assets invested in capital assets have decreased by a combined total of $106,640 in 2008, entirely attributable to the net loss from operations during the year.

The internally restricted fund balances have increased by $61,928 in 2008, as a result of the income from those funds.  This leaves a balance in those funds of $2,258,237 at April 30, 2008.

Other Relevant Data

As previously discussed, the financial data included in this package are excerpts from the annual financial statements.  Other important data included in the complete financial statements are as follows:

Statement of Cash Flows: This statement discloses those factors which have contributed to an increase in the cash position of the AMS over the past year.  Included here are such components as net income, purchases of property, furniture and equipment, collection of accounts receivable, etc.

Notes to Financial Statements: The notes provide a forum for the disclosure of the accounting policies followed by the AMS, and additional details related to items contained in the statements.

Files

2009-04-30 alma mater society fs - audited statements.pdf