audit & finance committee meeting public...

AUDIT & FINANCE COMMITTEE MEETINGPUBLIC SESSION

Wednesday, November 16, 2016 at 9:00 a.m.

Boardroom, 787 Ouellette Avenue, Windsor, Ontario

Commissioners

E. Sovran, Chair J. Elliott

D. Lawson H. Payne

1. Call to Order & Declarations of Conflicts of Interest

2. Summary of Business

3. Consent Agenda

3.1 WUC Audit & Finance Meeting Minutes of September 28, 2016

3.2 Audit Planning Report

4. Communication Agenda

4.1 2016 Meeting Dates

4.2 2017 Meeting Dates

4.3 Initiatives Tracking Report

5. EnWin Executive Reports

5.1 Financial Results Q3 2016

6. In Camera Session (enclosed under separate cover)

6.1 WUC Audit & Finance In Camera Meeting Minutes of August 18, 2016s. 239(2)(a) the security of the property of the municipality or local board s. 239(2)(f) advice that is subject to solicitor-client privilege

7. Other Business

8. Conclude Meeting

WUC Audit & Finance Committee Meeting - Agenda

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SUMMARY OF BUSINESS

WINDSOR UTILITIES COMMISSION AUDIT & FINANCE COMMITTEE

WEDNESDAY, NOVEMBER 16, 2016PUBLIC SESSION

Item Pg# Recommendation

1. NA Call to Order and Declarations of Conflicts of Interest

NA That the agenda be approved.

3. 3-29

That the following Consent Agenda items be received or approved as recommended:

3.1 WUC A&F Committee Meeting Minutes of September 28, 2016 be approved 3.2 Audit Planning Report

4. 30-36

That the following Communication Agenda items be received as recommended:

4.1 2016 Meeting Dates be received 4.2 2017 Meeting Dates be received 4.3 Initiatives Tracking Report be received

5.1 37-48 Financial Results Q3 2016

6. NA

That the Commission move in camera.

That the in camera session be concluded.

That the recommendations discussed in camera be brought forward for consideration.

That the following Consent Agenda items be received or approved as recommended:

6.1 WUC A&F Committee Meeting Minutes of September 28, 2016 be approved

8 NA That the meeting be adjourned.

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WUC Audit & Finance Committee Meeting - Summary of Business

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WINDSOR UTILITIES COMMISSION AUDIT & FINANCE COMMITTEE MEETING

PUBLIC MEETING MINUTES WEDNESDAY, SEPTEMBER 28, 2016

A public meeting of the Windsor Utilities Commission Audit & Finance Committee was held on Wednesday, September 28, 2016, in the Boardroom at 787 Ouellette Avenue, Windsor, Ontario. ATTENDANCE Commissioners: Doug Lawson, John Elliott and Egidio Sovran Regrets: Hilary Payne EWU Management: President & CEO, H. Reidel, VP Finance & CFO, V. Zuber,

VP Asset Management, J. Wladarski, VP Operations, J. Stuart, L. Rauch, Director Finance, Water Controller, B. Pougnet, Hydro Controller, H. Malcolm-Kiss and Recording Secretary, C. Menard

Guests: Commissioner J. Drummond CALL TO ORDER & DECLARATION OF CONFLICTS OF INTEREST There being a quorum and proper notices received, the Chair called the meeting to order at 9:07 a.m. CONSENT AGENDA Moved by D. Lawson and seconded by J. Elliott That the following Consent Agenda items be received or approved as recommended:

3.1 WUC A&F Committee Meeting Minutes of August 18, 2016 be approved -CARRIED

COMMUNICATIONS AGENDA Moved by J. Elliott and seconded by D. Lawson That the following Communication Agenda items be received as recommended:

4.1 2016 Meeting Schedule be received 4.2 Initiatives Tracking Report be received -CARRIED

EXECUTIVE REPORTS V. Zuber presented a PowerPoint deck highlighting areas of interest concerning the 2017-2022 budgets, mainly an increase in operational expenses, reduced revenue and a cash flow deficit.

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WUC Audit & Finance Committee Meeting - Consent Agenda

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2 WUC AUDIT & FINANCE COMMITTEE DRAFT Public Meeting Minutes September 28, 2016 There was a consensus that it would be beneficial to discuss agenda items 5.2 through 5.5 prior to approving the budget. The agenda items were rearranged accordingly. WUC CASH MANAGEMENT ALTERNATIVES REPORT Management presented cash alternatives to address potential deficits projected for 2018 through 2021. The options presented for consideration were; increased rates, deferral of the sinking fund payment, borrowing of funds and reduction in capital spending. After a very detailed review of the contributing factors and the recommended solutions, the Committee was opposed to the deferral of the sinking fund contributions and in support of a temporary reduction in capital spending to address the short-term cashed deficit. H. Reidel noted that the current budget does not include the central feeder main and Management would have to address the impact that it would have on cash flow if the project were to be reintroduced. There was a discussion concerning cash reporting and the Committee asked Management to report back to the Commission on borrowing options concerning cash flow. Moved by D. Lawson and seconded by J. Elliott That the WUC Cash Management Alternatives Report be received; That the WUC Cash Management Alternatives Report along with the PowerPoint presentation with additional options presented by the CFO, be received; And that the Audit & Finance Committee recommend to the Board of Commissioners that the capital budget be reduced by $2 million in each of 2017, 2018 and 2019, to reduce the need for borrowing other means to alleviate the cash deficit; And that the Audit & Finance Committee further recommend to the Windsor Utilities Commission that Management be authorized to proceed with required joint capital projects with the City of Windsor that are not identified within the budget as they arise, subject to the ability to borrow any necessary funds from the City of Windsor for these projects to alleviate any further potential cash deficit. - CARRIED WATER METER REPLACEMENT ACCELERATION PROJECT REPORT Moved by D. Lawson and seconded by J. Elliott That the Water Meter Replacement Acceleration Project Report be received. - CARRIED

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3 WUC AUDIT & FINANCE COMMITTEE DRAFT Public Meeting Minutes September 28, 2016 RESERVOIR “G” COSTING REPORT J. Stuart provided an update on the Reservoir project. The RFP was issued and proponents are being assessed with an expected closing date of late October. A discussion took place concerning the established budget for the new reservoir project. The Commission was advised that in the mandatory proponent interviews one proponent indicated that the budget may be insufficient but the others did not reference the magnitude of the budget. Therefore management remains hopeful that the budget is sufficient but this will not be known until the RFP envelope 2 is opened. Moved by D. Lawson and seconded by J. Elliott That the Reservoir “G” Costing Report be received. - CARRIED WATER VOLUMETRIC FLOW ESTIMATES REPORT There was a detailed discussion outlining the consistency of water flow projections and how volumes are calculated within the budget. V. Zuber advised the Committee that a new methodology was used and is expected to more closely reflect the declining volumes then in prior years. The Committee expressed concern regarding the reduction in water volumes and the declining trend and asked Management to monitor the situation and report back on concerns or abnormalities. H. Reidel noted that if trends continue to decline The Commission will need to consider addressing water rates, specifically the fixed portion to relieve the potential cash flow shortfall. For the interim, Management suggested the precautionary approach to hold the rates and continue to assess the situation and if needed, consider the contingency plan. H. Reidel advised that Management will be providing a rate analysis sometime within the first half of 2017. There was a discussion regarding the possibility of a revenue surplus at end of the year. Management confirmed that if a surplus is generated, it could be set aside to fund capital requirements in accordance with the terms of the WSOA. Management will report back to the Committee on reserve funding options.

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4 WUC AUDIT & FINANCE COMMITTEE DRAFT Public Meeting Minutes September 28, 2016 Moved by D. Lawson and seconded by J. Elliott That the Water Volumetric Flow Estimates Report be received. And that for budget planning purposes, volumetric flows be monitored and that Management report back to the Commission annually as recommended by the Audit & Finance Committee. And that the Audit & Finance Committee recommend to the Windsor Utilities Commission, that any surplus generated be invested into an established reserve fund within the parameters of the WSOA; And that established water rates be monitored to address potential volume fluctuations with a report back to the WUC in the first half of 2017. -CARRIED 2017 – 2022 WATER SYSTEM OPERATING EXPENSE AND CAPITAL EXPENDITURE PLANS There was a discussion about the 2017-2022 Water System Operating Expense and Capital Expenditure Plans, specifically cash flow and contributing factors to the potential deficit. Management noted that several items were removed and or reduced from prior years to produce this budget. The Committee was satisfied with the information provided and recommended appropriate amendments to the capital budget to address the cash flow concern. Moved by J. Elliott and seconded by D. Lawson That the 2017 – 2022 Water System Operating Expense and Capital Expenditure Plans be received; And the Audit & Finance Committee recommend to the Windsor Utilities Commission that the capital budget be reduced by $2 million annually in 2017, 2018 and 2019 to compensate for the forecasted cash flow shortfall contained in the budget presented by Management; And that the Audit & Finance Committee recommend to the Windsor Utilities Commission that Management be authorized to proceed with required joint capital projects with the City of Windsor that are not identified in the budget as they arise, subject to the ability to borrow any required funds from the City of Windsor to alleviate any further potential cash deficit; And that the 2017 – 2022 Water System Operating Expense and Capital Expenditure Plans be confirmed with amendments as recommended by the Audit & Finance Committee, with a report back to the Windsor Utilities Commission on water rates in the first half of 2017. -CARRIED

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5 WUC AUDIT & FINANCE COMMITTEE DRAFT Public Meeting Minutes September 28, 2016 ADJOURNMENT Moved by J. Elliott and seconded by D. Lawson That the meeting be adjourned. -CARRIED Meeting adjourned at 10:28 a.m. Recording Secretary Chair

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Windsor Utilities Commission

Audit Planning Report For the year ended December 31, 2016

Licensed Public Accountants

November 16, 2016

kpmg.ca/audit

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Windsor Utilities Commission Audit Planning Report for the year ended December 31, 2016 2

Table of contents Executive summary 3

Risk assessment 4

Audit approach 5

Data & analytics in the audit 8

Materiality 9

Highly talented and experienced team 10

Value for fees 11

Audit cycle and timetable 13

Appendices 14

At KPMG, we are passionate about earning your trust. We take deep personal accountability, individually and as a team, to deliver

exceptional service and value in all our dealings with you.

At the end of the day, we measure our success from the only perspective that matters – yours.

The contacts at KPMG in connection with this report are:

Cynthia Swift

Lead Audit Engagement Partner

Tel: 519-251-3520 [email protected]

Amy Wolters

Audit Manager

Tel: 519-251-3506 [email protected]

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This Audit Planning Report should not be used for any other purpose or by anyone other than the Audit and Finance Committee. KPMG shall have no responsibility or liability for loss or damages or claims, if any, to or by any third party as this Audit Planning Report has not been prepared for, and is not intended for, and should not be used by, any third party or for any other purpose.

Executive summary Audit and business risk Our audit is risk-focused. In planning our audit we have taken into account key areas of focus for financial reporting.

See page 4.

KPMG team The KPMG team will be led by Cynthia Swift and Amy Wolters.

See page 10.

Effective communication We are committed to transparent and thorough reporting of issues to Helga Reidel, President and CEO, Victoria Zuber, CFO, Laura Rauch, Director of Finance, and the Audit and Finance Committee. See page 13 and Appendix 3

Audit Materiality Materiality has been determined based on total assets. We have determined materiality to be $1.5M for the year ending December 31, 2016.

See page 9.

Value for fees While the primary objective of our engagement is the completion of an audit of the financial statements in accordance with professional standards, we also believe that our role as external auditor of Windsor Utilities Commission and the access to information and people in conjunction with our audit procedures, places us in a position to provide other forms of value.

See page 11.

Independence We are independent and have extensive quality control and conflict checking processes in place. We provide complete transparency on all services and follow Audit and Finance Committee approved protocols.

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Risk assessment Our planning begins with an assessment of inherent risk of material misstatement in your financial statements. Our assessment is based on a variety of factors that include our knowledge of your business, the market and the susceptibility of the account balance to the risk of material misstatement.

This diagram represents our top-down view of the financial reporting risks and their potential misstatement impact, mapped against the likelihood of a misstatement occurring (before considering controls).

Likelihood of occurrence (before considering controls)

Mag

nitu

de o

f im

pact

Low

High

Regulatory risk

Fraud risk over management override

of controls Related party transactions

Significant financial reporting risks, including estimates and judgement Operational risks Other areas of focus

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Audit approach Significant financial

reporting risks Why Our audit approach

We have not identified any financial reporting risks during our audit planning that we consider to be significant.

Not applicable. Not applicable.

Inherent risk is the susceptibility of a balance or assertion to misstatement which could be material, individually or when aggregated with other misstatements, assuming that there are no related controls.

Our assessment of inherent risk is based on various factors, including the size of the balance, its inherent complexity, the level of uncertainty in measurements, as well as significant external market factors or those particular to the internal environment of the entity.

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Audit approach (continued) CAS

requirements Why We have rebutted this fraud risk as it is not applicable to

Windsor Utilities Commission as performance is not measured based on revenue or earnings.

Fraud risk from revenue recognition

This is a presumed fraud risk. There are generally pressures or incentives on management to commit fraudulent financial reporting through inappropriate revenue recognition when performance is measured in terms of year-over-year revenue growth or profit.

We have rebutted this fraud risk as it is not applicable to Windsor Utilities Commission as performance is not measured based on revenue or earnings.

Fraud risk from management override of controls

This is a presumed fraud risk. We have not identified any specific additional risks of management override relating to this audit.

As the risk is not rebuttable, our audit methodology incorporates the required procedures in professional standards to address this risk. These procedures include testing of journal entries and other adjustments, performing a retrospective review of estimates and evaluating the business rationale of significant unusual transactions.

Professional standards presume the risk of fraudulent revenue recognition and the risk of management override of controls exist in all companies.

The risk of fraudulent recognition can be rebutted, but the risk of management override of control cannot, since management is typically in a unique position to perpetrate fraud because of its ability to manipulate accounting records and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively.

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Audit approach (continued) Other areas

of focus Why Our audit approach

Related party transactions

Due to the Water System Operating Agreement and Employee Arrangement Agreements in place between EnWin Utilities Ltd. (“EnWin”) and Windsor Utilities Commission, there is increased public awareness around the related party transactions of this entity.

– In response to the enclosed risk, KPMG will recalculate the compensation calculations in the respective agreements to ensure that they are accurate and reflective of the terms and conditions of the underlying agreements. Furthermore, KPMG will ensure that the balances outstanding and annual transactions are agreed amongst related parties.

Property, plant, and equipment

Significant of the account balances. Large volume of capital activity and key decision points regarding the identification of capital vs. operating work orders.

– Test a sample of capital additions.

– Review and evaluate the process for allocating overhead to constructed assets.

– Calculations of depreciation expense.

Revenue and unbilled revenue

Significant of the account balances. Estimates in the calculation of unbilled revenue.

– Perform analysis based on approved/market rates and monthly consumption.

– Compare billings, usage, and rates in subsequent period (i.e. January and February 2017) to substantiate the unbilled amounts.

Other areas of focus include the following:

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Data & analytics in the audit Area(s) of focus Planned D&A routines

Journal entry testing

– Utilizing KPMG application software (IDEA) to evaluate the completeness of the journal entry population through a roll-forward of all accounts

– Utilizing computer-assisted audit techniques (CAATs) to analyze journal entries and apply certain criteria to identify potential high-risk journal entries for further testing

Detailed results and summary insights gained from D&A will be shared with management and presented in our Audit Findings Report.

We will be integrating Data & Analytics (D&A) procedures into our planned audit approach.

Use of innovative D&A allows us to analyze greater quantities of data, dig deeper and deliver more value from our audit.

We believe that D&A will improve both the quality and effectiveness of our audit by allowing us to analyze large volumes of financial information quickly, enhancing our understanding of your business as well as enabling us to design procedures that better target risks.

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Materiality The determination of materiality requires professional judgment and is based on a combination of quantitative and qualitative assessments including the nature of account balances and financial statement disclosures.

Materiality determination Comments Amount

Metrics Relevant metrics include assets and revenues.

Benchmark Based on total assets from interim statements as at September 30, 2016. This benchmark is consistent with the prior year.

$295,133,000

% of Benchmark 0.5%

Materiality Determined to plan and perform the audit and to evaluate the effects of identified misstatements on the audit and of any uncorrected misstatements on the financial statements (2015 - $1.4 million).

$1.5 million

Performance materiality

Used 75% of materiality, and used primarily to determine the nature, timing and extent of audit procedures (2015 - $1.05 million).

$1.1 million

Audit Misstatement Posting Threshold (AMPT)

Threshold used to accumulate misstatements identified during the audit (2015 - $70,000, $140,000 for reclassification).

$75,000 $150,000 for reclassification

Professional standards require us to re-assess materiality at the completion of our audit based on period-end results or new information in order to confirm whether the amount determined for planning purposes remains appropriate.

Our assessment of misstatements, if any, in amounts or disclosures at the completion of our audit will include the consideration of both quantitative and qualitative factors.

The first step is the determination of the amounts used for planning purposes as follows.

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Highly talented and experienced team Team member Background / experience Discussion of role

Cynthia Swift Lead Audit Engagement Partner [email protected] 519-251-3520

– Cynthia is an Audit Partner in our Windsor office with over 25 years of experience. Cynthia is involved in the audits of a number of small to large clients including several IFRS clients. Cynthia has been on the Windsor Utilities Commission audit since 2010.

– Cynthia will lead our audit of Windsor Utilities Commission and will be responsible for the overall deliverables to the Audit and Finance Committee.

– She will do a high level review of the audit and will always be available and accessible to you.

Amy Wolters Audit Manager [email protected] 519-251-3506

– Amy has experience with various clients in the not-for-profit, private, and public sector, including IFRS clients. Amy has been involved in the Windsor Utilities Commission audit since 2013

– Amy will work very closely with Cynthia on all aspects of our audit. She will be on site periodically throughout fieldwork to lead and manage our audit team.

– Amy will be in direct contact with the management/finance team throughout the entire audit.

Jill Mackie Audit Senior [email protected] 519-251-3500

– Jill has over 2 years of experience in public accounting, with various clients in the not-for-profit, private, and public sector. Jill has been involved in the Windsor Utilities Commission audit since 2015.

– Jill will be onsite throughout the course of our fieldwork and will lead the audit team as they are in the field.

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Value for fees The value of our audit services We recognize that the primary objective of our engagement is the completion of an audit of the financial statements in accordance with professional standards. We also believe that our role as external auditor of Windsor Utilities Commission and the access to information and people in conjunction with our audit procedures, place us in a position to provide other forms of value. We know that you expect this of us.

We want to ensure we understand your expectations. To facilitate a discussion (either in the upcoming meeting or in separate discussions), we have outlined some of the attributes of our team and our processes that we believe enhance the value of our audit service. We recognize that certain of these items are necessary components of a rigorous audit. We welcome your feedback.

– Extensive industry experience on our audit team – as outlined in our team summary, the senior members of our team have extensive experience in audits of companies in your industry. This experience ensures that we are well positioned to identify and discuss observations and insights that are important to you;

– Current development update sessions – we will organize and deliver a tailored information session on current developments in financial reporting and other matters that are likely to be significant to the Commission and your team. These sessions will assist the Commission in proactively responding to financial reporting and regulatory changes;

– Involvement of KPMG specialists – Our audit team is supported by specialists in income and other taxes, information risk management, valuations, derivatives. We expect each of the specialists to provide insights and observations resulting from their audit support processes;

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Value for fees In determining the fees for our services, we have considered the nature, extent and timing of our planned audit procedures as described above. Our fee analysis has been reviewed with and agreed upon by management.

Our fees are estimated as follows:

Current period (budget) Prior period (actual)

Audit of the annual financial statements $16,700 $16,700

Matters that could impact our fee The proposed fees outlined above are based on the assumptions described in the engagement letter. The critical assumptions, and factors that cause a change in our fees, include:

– Significant changes in the nature or size of the operations of the Commission beyond those contemplated in our planning processes;

– Changes in professional standards or requirements arising as a result of changes in professional standards or the interpretation thereof;

– Changes in the time of our work.

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Audit cycle and timetable

Our key activities during the year are designed to achieve our one principal objective:

To provide a robust audit, efficiently delivered by a high quality team focused on key issues.

Our timeline is in line with prior year.

Planning

Interim fieldwork

Final fieldwork

and reporting

Statutory / Other Reporting

Debrief

Strategy Ongoing communication with

Board/Audit and Finance Committee

and Senior Management

Audit plan discussion: November 2016

Final fieldwork: Weeks of January 30 and February 6, 2017

Audit strategy Discussions based on

debrief of audit

Audit findings discussion: April 2017

Interim fieldwork: Week of November 14,

2016

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Appendices Appendix 1: Audit quality and risk management

Appendix 2: KPMG’s audit approach and methodology

Appendix 3: Required communications

Appendix 4: Data & analytics in audit

Appendix 5: Expanded Auditor Reporting

Appendix 6: Current developments

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Appendix 1: Audit quality and risk management KPMG maintains a system of quality control designed to reflect our drive and determination to deliver independent, unbiased advice and opinions, and also meet the requirements of Canadian professional standards.

Quality control is fundamental to our business and is the responsibility of every partner and employee. The following diagram summarises the six key elements of our quality control systems.

Visit our Audit Quality Resources page for more information including access to our audit quality report, Audit quality: Our hands-on process.

Independence, integrity, ethics and objectivity

Independent monitoring

– Other controls include:

– Before the firm issues its audit report, Engagement Quality Control Reviewer reviews the appropriateness of key elements of publicly listed client audits.

– Technical department and specialist resources provide real-time support to audit teams in the field.

– We conduct regular reviews of engagements and partners. Review teams are independent and the work of every audit partner is reviewed at least once every three years.

– We have policies and guidance to ensure that work performed by engagement personnel meets applicable professional standards, regulatory requirements and the firm’s standards of quality.

– All KPMG partners and staff are required to act with integrity and objectivity and comply with applicable laws, regulations and professional standards at all times.

– We do not offer services that would impair our independence.

– The processes we employ to help retain and develop people include:

– Assignment based on skills and experience; – Rotation of partners; – Performance evaluation; – Development and training; and – Appropriate supervision and coaching.

– We have policies and procedures for deciding whether to accept or continue a client relationship or to perform a specific engagement for that client.

– Existing audit relationships are reviewed annually and evaluated to identify instances where we should discontinue our professional association with the client.

Audit quality and risk

management

Personnel management

Other risk management

quality controls

Independent monitoring

Engagement performance

standards

Acceptance & continuance of

clients / engagements

Independence, integrity, ethics and objectivity

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Appendix 2: KPMG’s audit approach and methodology Technology-enabled audit workflow (eAudIT) Engagement Setup

– Tailor the eAudIT workflow to your circumstances

– Access global knowledge specific to your industry

– Team selection and timetable

Completion


– Update risk assessment

– Perform completion procedures and overall evaluation of results and financial statements

– Form and issue audit opinion on financial statements

– Obtain written representation from management

– Required Audit Committee communications

– Debrief audit process

Risk Assessment


– Understand your business and financial processes

– Identify significant risks

– Plan the use of KPMG specialists and others including auditor’s external experts, management experts, internal auditors, service organizations auditors and component auditors

– Determine audit approach

– Evaluate design and implementation of internal controls (as required or considered necessary)

Testing


– Perform tests of operating effectiveness of internal controls (as required or considered necessary)

– Perform substantive tests

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Appendix 3: Required communications In accordance with professional standards, there are a number of communications that are required during the course of our audit. These include:

– Engagement letter – the objectives of the audit, our responsibilities in carrying out our audit, as well as management’s responsibilities, are set out in the engagement letter dated November 5, 2015.

– Audit planning report – as attached

– Required inquiries – professional standards require that during the planning of our audit we obtain your views on risk of fraud and other matters. We make similar inquiries to management as part of our planning process; responses to these will assist us in planning our overall audit strategy and audit approach accordingly

– Management representation letter – we will obtain from management certain representations at the completion of the annual audit. In accordance with professional standards, copies of the representation letter will be provided to the Audit and Finance Committee

– Audit findings report – at the completion of our audit, we will provide a report to the Audit and Finance Committee

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Appendix 4: Data & analytics in audit Turning data into value KPMG continues to make significant investments in our Data & Analytics (D&A) capabilities to help enhance audit quality and provide actionable insight to our clients by unlocking the rich information that businesses hold.

When D&A is applied to the audit, it enables us to test complete data populations and understand the business reasons behind outliers and anomalies. Advancements in D&A tools allow us to analyze data at more granular levels, focusing on higher risk areas of the audit and developing insights you can then leverage to improve compliance, potentially uncover fraud, manage risk and more.

KPMG is enhancing the audit The combination of our proven industry experience, technical know-how and external data allows us to focus our audit on the key business risks, while providing relevant insights of value to you.

– Automated testing of 100% of the population

– Focuses manual audit effort on key exceptions and identified risk areas

Audit quality

For the audit

– Helping you see your business from a different perspective

– How effectively is your organization using your systems?

Actionable insight

For your business

D&A enabledaudit

methodology

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Appendix 5: Expanded Auditor Reporting In response to investors demanding more than a binary pass/fail opinion from the auditors’ report, the new and revised auditor reporting standards have introduced significant changes to the traditional report we provide.

What’s new? The new standards are intended to provide greater insight and transparency for users of financial statements.

The most significant changes to the audit report impacting listed entities include:

description of key audit matters; and

disclosure of the name of the engagement partner.

Other changes impacting listed and non-listed entities include moving the audit opinion to the first section of the report and expanding descriptions of the auditors’ and management’s responsibilities with respect to the audited financial statements.

When are the new requirements effective? While the new standards have already been issued by the International Auditing and Assurance Standards Board, effective for 2016 calendar year-end, they have yet to be adopted as Canadian Auditing Standards (CASs).

The Auditing and Assurance Standards Board in Canada continues to deliberate the new standards including possible effective dates and whether to allow for early application. It is expected, however, that the new auditor reporting standards will be approved in late 2016/early 2017 with an effective date of 2018 calendar year-end audits with possible staggered implementation for certain types of entities.

Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the financial statements of the current period.

We will be required to include in our auditors’ report why the key audit matter is of most significance and what procedures we performed to address the matter.

Matters communicated to those charged with governance

Matters that required significant auditor attention in performing the audit

Key audit matters(Matters of most significance)

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Appendix 6: Current developments Please visit the Audit Committee Institute page for current developments in IFRS, Canadian securities matters, Canadian auditing other professional standards and US accounting, auditing and regulatory matters.

The following is a summary of the current developments that are relevant to the Commission.

Standard Summary and implications Reference

IFRS 9, Financial Instruments The new standard introduces new requirements and changes to the classification and measurement of financial assets and liabilities, impairment and general hedge accounting. The mandatory effective date of IFRS 9 is for annual periods beginning on or after January 1, 2018 and must be applied retrospectively with some exemptions. Early adoption is permitted. The Commission does not intend to early adopt these standards.

For additional information about the Financial Instruments Standard, refer to KPMG’s website Financial Instruments - Introducing IFRS 9, In the Headlines – Issue 2013/19

IFRS 15, Revenue from Contracts with Customers

The new standard contains a single, principles based five-step model for recognizing revenue from customers. The new standard does not apply to insurance contracts, financial instruments or lease contracts, which fall in the scope of other IFRSs. The mandatory effective date of IFRS 15 is for annual periods beginning on or after January 1, 2018. Early adoption is permitted. The Commission does not intend to early adopt these standards.

For more details, refer to KPMG’s website IFRS – Revenue and publication First Impressions: IFRS 15 Revenue.

IFRS 16, Leases

The new standard introduces a single lessee accounting model which requires companies to bring most leases on balance sheet. The mandatory effective date of IFRS 16 is for annual periods beginning on or after January 1, 2019. Early adoption is permitted for entities that apply IFRS 15 at or before the date of initial adoption of IFRS 16. The Commission does not intend to early adopt these standards.

For more details, refer to KPMG’s publications IFRS Breaking News: New leases standard - Introducing IFRS 16, KPMG’s SlideShare Presentation and First Impressions: IFRS 16 Leases.

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KPMG LLP, an Audit, Tax and Advisory firm (kpmg.ca) and a Canadian limited liability partnership established under the laws of Ontario, is the Canadian member firm of KPMG International Cooperative (“KPMG International”).

KPMG member firms around the world have 174,000 professionals, in 155 countries.

The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss entity. Each KPMG firm is a legally distinct and separate entity, and describes itself as such.

© 2016 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

kpmg.ca/audit

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S M T W TH F S S M T W TH F S1 2 1 2 3 4 5 6

3 4 5 6 7 8 9 7 8 9 10 11 12 1310 11 12 13 14 15 16 14 15 16 17 18 19 2017 18 19 20 21 22 23 21 22 23 24 25 26 2724 25 26 27 28 29 30 28 2931

S M T W TH F S S M T W TH F S1 2 3 4 5 1 2

6 7 8 9 10 11 12 3 4 5 6 7 8 913 14 15 # # # 19 10 11 12 13 14 15 1620 21 22 23 24 25 26 17 18 19 20 21 22 2327 28 29 30 31 24 25 26 27 28 29 30

S M T W TH F S S M T W TH F S1 2 3 4 5 6 7 1 2 3 48 9 10 11 12 13 14 5 6 7 8 9 10 11

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Statutory Declared Holiday

School Holidays ~ March 14-18, 2016

TUESDAY MEETINGS

WUC Governance Committee @ 10:30am

THURSDAY MEETINGS

WUC Audit & Finance Committee @ 9:15 am

WUC Audit & Finance Committee @ 11:00 am

FRIDAY MEETINGS

WUC Board of Commissioners @ 9:15 am

ALL MEETINGS HELD AT 787 OUELLETTE IN THE SECOND FLOOR BOARDROOM

WINDSOR UTILITIES COMMISSIONSCHEDULE OF MEETINGS - 2016

JANUARY 2016 FEBRUARY 2016

NOVEMBER 2016 DECEMBER 2016

MARCH 2016 APRIL 2016

MAY 2016 JUNE 2016

JULY 2016 AUGUST 2016

SEPTEMBER 2016 OCTOBER 2016

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MONDAY MEETINGS

EWE Board of Directors @ 8:30 am

TUESDAY MEETINGS

WCU & EWU Audit & Finance Committees - Joint Meeting @ 9:15 am

EWU Audit & Finance Committee @ 9:30 am

EWU Board of Directors @ 9:15 am (*October 21 @ 10:15 am; November 10 @ 9:30 am)

THURSDAY MEETINGS

EWU Governance & Human Resources Committee @ 10:30 am (*November 10 @ 8:30 am)

WCU Board of Directors @ 10:30 am

SPECIAL MEETINGS

EWU/WCU Audit & Finance Committee (Contract Approvals) @ 9:15 amEWU Board Meeting (Contract Approvals) @ 9:45 am

ALL MEETINGS HELD AT 787 OUELLETTE IN THE SECOND FLOOR BOARDROOM

DECEMBER 2016

MAY 2016 JUNE 2016


NOVEMBER 2016

SCHEDULE OF MEETINGS - 2016ENWIN GROUP OF COMPANIES




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Statutory Declared HolidaySchool Holidays ~ March 13-17, 2017 WCU Board of Directors WCU Audit & Finance CommitteeEWU Board of DirectorsEWU Audit & Finance Committee EWU Governance & Human Resources CommitteeEWU Executive Committee EWE Board of Directors WUC Board of Commissioners WUC Audit & Finance Committee WUC Governance Committee

MEETINGS WILL BE HELD AT 787 OUELLETTE IN THE SECOND FLOOR BOARDROOM AT 9 AM

*EWU EXECUTIVE COMMITTEE MEETINGS AT 8 AM

SCHEDULE OF MEETINGS - 2017ENWIN GROUP OF COMPANIES




DECEMBER 2017

MAY 2017 JUNE 2017


NOVEMBER 2017

4.2


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31



WUC Board of Commissioners

WUC Audit & Finance Committee

WUC Governance Committee

MEETINGS WILL BE HELD AT 787 OUELLETTE IN THE SECOND FLOOR BOARDROOM AT 9 AM

WINDSOR UTILITIES COMMISSIONSCHEDULE OF MEETINGS - 2017




NOVEMBER 2017 DECEMBER 2017

MAY 2017 JUNE 2017


4.2


33

Board or Committee Date

1 A&F / Board August 2016 DEW Strategic Assessment / Business Case VP Shared Services TBD

2 A&F/ Board August 2015 Investment Policy Sensitivity Analysis CFO December 2016

3 A&F May 2016 Development Charge Project Tracking Report CFO April 2017

4 A&F / Board August 2016 Water Agreement Contractual Reset Report VP Water Prior to March 17

5 Board May 2016 Insurance Coverage & Indemnification By-law Report VP Corporate Services December 2016

6 A&F August 2016 PWC Findings Update Report CFO December 2016

7 A&F Sept 2016 Cash Management, Borrowing Options & Rate Analysis CFO Q2 2017

8 Board August 2016 Commissioner Compensation (Comparators for CouncilConsideration ) VP Corporate Services Q1 2018

9 Board October 2016 Leaking washers on water meters report VP Shared Services Q1 2017

10 Board October 2016 Reservoir 'G' Update Report VP Water Q1 2017

11 Board October 2016 Employee Benefits Costs Analysis - current vs. previous years CFO Q1 2017

12 Board October 2016 Lead services in residential areas report update VP Water Q1 2017

13 Board October 2016 Community Energy Plan re; DEW VP Shared Services Q1 2017

Windsor Utilities Commission Board and Committees

Initiatives Tracking Report (2016)

InitiatedInitiatives Management Lead Return Date

Outstanding Initiatives 4.3


34

Ongoing Initiatives


1 Board 2015 Sinking Fund Portfolio Review CFO Bi-Annually

2 Board April 2016 Confirm Water Operator MOECC Certification VP Water Annually

3 Board May 2016 Risk Insurance Coverage CFO Annually

4 A&F Sept 2016 Water Volumes & Rate Abnormalities Reporting VP Water / CFO Annually

Windsor Utilities CommissionBoard and Committees

Initiatives Tracking Report (2016)

InitiatedInitiatives Management Lead Return

Date

4.3


35

R:\Board & Committee Agendas\Audit & Finance Meetings\2016\9. November Working Files\WUC_Initiatives Tracking Report_Nov 2016.xlsx


1 Board April 2016 Commission Compensation Comparators CFO May 2016

2 Board April 2016 Risk Management Plan CFO August 2016

3 A&F May 2016 George Avenue Park Rendering VP Operations August 2016

4 Board May 2016 Enterprise Risk Management CFO November 2016

5 Board May 2016 Cyber Security (Training Presentation) CFO August 2016

6 Board May 2016 Compensation Recommendation CEO August 2016

7 Board April 2016 DEW Strategy VP Asset Management August 2016

8 A&F April 2016 Sinking Fund - RBC Presentation CFO August 2016

9 Board August 2016 Annual Wholesale Cost Report CFO September 2016

10 Board August 2016 Publication of Draft Committee Minutes in Board Package VP Corporate Services October 2016

11 A&F Sept 2016 Verbal Review of Reserve Funding Options (WSOA) CEO Q1 2017

Completion DateInitiatives Management Lead

Board and CommitteesInitiatives Tracking Report (2016)

Initiated

Completed Initiatives 4.3


36

5.1

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37

5.1


38

WINDSOR UTILITIES COMMISSIONBALANCE SHEETAS AT SEPTEMBER 30, 2016(in thousands of Canadian dollars)

September September December2016 2015 2015

Current AssetsCash and Bank 4,321$ 6,356$ 1,929$ Investments 26,479 26,074 26,182 Accounts Receivable 4,787 4,291 4,142 Accounts Receivable - Unbilled Revenue 3,727 4,817 4,188 Inventories 716 736 581 Prepaid Expenses 251 228 315

Total Current Assets 40,281 42,502 37,337

Property, Plant and EquipmentProperty, Plant and Equipment 287,161 264,221 271,299 Accumulated Depreciation (36,799) (30,154) (31,727)

Total Property, Plant and Equipment 250,362 234,067 239,572

Other AssetsInvestments, Sinking Fund 4,479 3,150 3,785 Work in Progress 12 39 6

Total Other Assets 4,491 3,189 3,791

TOTAL ASSETS 295,134$ 279,758$ 280,700$

Current LiabilitiesAccounts Payable and Accrued Liabilities 9,772$ 8,316$ 6,781$ Due to Related Parties 3,182 3,142 3,114

Total Current Liabilities 12,954 11,458 9,895

Long-Term LiabilitiesLong-Term Debt 51,329 51,316 51,320 Due to EWU 4,520 5,342 4,520 Customer Deposits 72 85 4 Employee Future Benefits 6,190 6,492 6,251 Deferred Revenue 1,511 1,877 1,536

Total Long-Term Liabilities 63,622 65,112 63,631

EquityContributed Capital 61,854 61,854 61,854 Retained Earnings 156,704 141,334 145,320

Total Equity 218,558 203,188 207,174

TOTAL LIABILITIES AND EQUITY 295,134$ 279,758$ 280,700$

ASSETS

LIABILITIES

SHAREHOLDER'S EQUITY

5.1


39

WINDSOR UTILITIES COMMISSIONINCOME STATEMENT

FOR THE PERIOD ENDED SEPTEMBER 30, 2016

(in thousands of Canadian dollars)Annual Latest Current

Actuals Budget Variance Actuals Variance Budget Estimate

REVENUEFixed Revenues 12,979$ 12,973$ 6$ 12,968$ 11 17,298$ 17,303$ Consumption Revenues 11,122 11,908 (786) 10,324 798 15,496 14,277 Suburban Wholesale 2,478 2,088 390 2,078 400 2,674 3,064 Watermain Levy 10,846 11,196 (350) 10,481 365 14,757 14,211

TOTAL REVENUE 37,425 38,165 (740) 35,851 1,574 50,225 48,855

MISCELLANEOUS REVENUESDistrict Energy (Net) 830 926 (96) 835 (5) 1,238 1,142 Change of Occupancy 90 78 12 80 10 104 116 Late Payment and Collection Charges 48 48 - 54 (6) 64 64 Sale of Scrap 43 14 29 19 24 18 48 Other Operating Revenues 809 294 515 404 405 391 905

TOTAL MISCELLANEOUS REVENUES 1,820 1,360 460 1,392 428 1,814 2,275

OPERATING EXPENSESCost of Water Production 4,197 3,962 (235) 4,054 (143) 5,246 5,481 Transmission and Distribution Maintenance 2,992 3,180 188 3,371 379 4,236 4,236 Community Relations 129 136 7 125 (4) 181 181 Customer Billing and Collection 510 512 2 476 (34) 682 682 Administration and General 1,551 1,935 384 1,528 (23) 2,558 2,280 Vehicle Operations and Maintenance 147 75 (72) 149 2 126 199 Property and Tools Maintenance 1,171 1,206 35 1,284 113 1,597 1,580 Salaries & Benefits 6,910 6,988 78 6,682 (228) 9,157 9,107 Regulatory 7 6 (1) 7 - 6 6 Employee Future Benefits 1,423 1,424 1 1,500 77 1,899 1,899

TOTAL OPERATING EXPENSES 19,037 19,424 387 19,176 139 25,690 25,651

OPERATING INCOME 20,208 20,101 107 18,067 2,141 26,349 25,479

OTHER EXPENSESDepreciation 7,041 7,132 91 6,555 (486) 9,509 9,418 Interest Expense 1,406 1,419 13 1,433 27 1,893 1,879 Loss (Gain) on Sale of Property, Plant & Equipment 377 - (377) 194 (183) - 377

TOTAL OTHER EXPENSES 8,824 8,551 (273) 8,182 (642) 11,402 11,674

NET INCOME (LOSS) 11,384$ 11,550$ (166)$ 9,885$ 1,499$ 14,948$ 13,805$

Year to Date - September 30, 2016 Previous Year to Date - September 30, 2015

5.1


40

WINDSOR UTILITIES COMMISSIONCONSOLIDATED STATEMENT OF CHANGES IN FINANCIAL POSITIONFOR THE PERIOD ENDED SEPTEMBER 30, 2016(in thousands of Canadian dollars) September September December

2016 2015 2015

OPERATING ACTIVITIESNet Income 11,384$ 9,885$ 13,871$

Add (Deduct) Items not Affecting CashDepreciation 5,312 4,899 6,589 Loss (Gain) On Sale of Equipment 411 238 523 Change in Employee Future Benefits (61) (54) (295) Change in Cost of Issuing Debentures 9 9 13 Change in Work in Progress (6) (28) 5 Change in Non-Cash Working Capital Components 2,781 (1,160) (2,271) TOTAL CASH PROVIDED (USED) FROM OPERATIONS 19,830 13,790 18,435

FINANCING ACTIVITIESAmount Owing to EnWin Utilities Ltd. - - (822) Receipts from (Payments to) EnWin Utilities Ltd. 68 1,956 1,928 TOTAL CASH PROVIDED (USED) FROM FINANCING 68 1,956 1,106

INVESTING ACTIVITIESAcquisition of Capital Assets (16,514) (9,984) (17,464) Acquisition of Investments, Sinking Fund (600) (600) (1,200) Interest Earned on Investments (392) (357) (500) TOTAL CASH PROVIDED (USED) FROM INVESTING (17,506) (10,941) (19,164)

Net Increase (Decrease) in Cash for the Period 2,392 4,804 377

Cash, Beginning of Period 1,929 1,552 1,552

Cash, End of Period 4,321$ 6,356$ 1,929$

5.1


41

Windsor Utilities CommissionFinancial HighlightsWUC‐ September 30, 2016

REVENUES Actual Budget Positive (Negative)

Variance % Variance Reasons for VarianceTotal Revenues 37,425$ 38,165$ (740)$ -2% Water volumes pumped are 33,307 ML which is 2% below forecast.

Residential water consumption is up by 1% due to a very hot summer with below average precipitation. Commercial water usage is down 7% when compared to budget, however, after allowing for adjustments, consistent with 2015 levels. Historically Windsor consumption has been proportionately higher for ICI customers with the current trending towards a more even distribution with residential. Fixed meter revenues are consistent to budget.

Water Volumes Pumped (in ML) 33,307 34,006 (699) -2% Water volumes are below forecasted levels as water usage from residential customers are slightly above plan while commercial customers are lower than planned averages. Conservation, high-efficiency appliances as well as the 2016 budget was forecasted based on a three year average. 2016 forecast and 2017's budget is consistent with current trending.

Non Revenue Water % 16% 17% 1% September year to date results and the rolling 12 month average have NRW favourable compared to budget. NRW can be impacted by watermain breaks which tend to occur more often during the colder seasons.

Miscellaneous Revenues 1,820$ 1,360$ 460$ 34% Favourable variance is a result of increased revenue from scrap meter sales (offsetting some of the disposal costs on meters below) along with Development Charges, reconnection of services and tapping fees, all slightly offset by District Energy's unbudgeted variable rent settlement.

EXPENSES Actual Budget Positive (Negative)

Variance % Variance Reasons for VarianceCost of Water Production 4,197 3,962 (235) -6% Unfavourable variance is a result of waste water and utility costs higher than

planned offset by reduced chemical usage related to the delayed timing of corrosion control implementation.

Transmission and Distribution Maintenance 2,992 3,180 188 6% Favourable variance relates to hydrants, distribution mains and valve expenses offset by unfavourable meter maintenance, service and customer premise expenses. Watermain breaks are 34 below budget while service breaks are over budget by 23.

Community Relations 129 136 7 5% Variance is a result of timing.

Customer Billing and Collection 510 512 2 0% Amounts consistent with budget.

(in 000's) 5.1


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(in 000's)Administration and General 1,551 1,935 384 20% Favourable variance, consistent with Q2, is related to reduced professional

and legal services compared to budget as well as reduced shared services costs specifically in training, marketing, advertising and IT support costs.

5.1


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(in 000's)

EXPENSES Actual Budget Positive (Negative)

Variance % Variance Reasons for VarianceVehicle Operations and Maintenance 147$ 75$ (72)$ -96% Unfavourable variance related to the reduced internal allocation of trucking.

Property and Tool Maintenance 1,171 1,206 35 3% Favourable variance is a result of savings in property insurance and timing of tool maintenance.

Salaries and Benefits 6,910 6,988 78 1% Amounts consistent with budget.Regulatory 7 6 (1) -17% Amounts consistent with budget.Employee Future Benefits 1,423 1,424 1 0% Amounts consistent with budget. Total Operating Expenses 19,037$ 19,424$ 387 2%

Net Operating Profit 20,208$ 20,101$ 107 1%

Depreciation 7,041 7,132 91 1% Favourable variance is a result of the timing of capital expenditures being completed and placed into service.

Interest Expense 1,406 1,419 13 1% Overall consistent with budget. Loss (Gain) on Sale of PP&E 377 - (377) 100% Disposal of meter assets resulting from meter replacement program.Net Income 11,384$ 11,550$ (166)$ -1%

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Windsor Utilities CommissionKey Operational Metrics SummarySeptember 30, 2016

Cost Driver Operational Areas Impacted2016 YTD Actual

2016 YTD Budget

2015 YTD Actual

Water Pumpage YTD ‐ water filtration expenses ‐ water pumping expenses‐ chemical expenditures

33,307 ML 34,006 ML 33,002 ML

Watermain Breaks ‐ distribution main expenses‐ service line expenses 94 128 103

Service Line Breaks ‐ service line expenses 96 73 99Non Revenue Water % YTD ‐ water consumption revenues

‐ meter maintenance expenses‐ distribution main and service repair expenses

16% 17% 18%

Capital Expenditures ‐ operations and maintenance‐ depreciation expense

$ 16.5 M (1) $ 27.4 M $ 9.8 M

Source Water Quality ‐ chemical expenditures ‐ water filtration expenses 19.5 NTU (Avg

Per Month)19.7 NTU (Avg Per Month)

8.4 NTU (Avg Per Month)

(1) Favourable variance primarily due to delay in start of Reservoir project.

LegendNegative variance to budget RPositive variance to budget GNeutral impact to budget Y

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WINDSOR UTILITIES COMMISSION Month: 6

SUMMARY CAPITAL PLANSeptember 30, 2016(in thousands of Canadian dollars)

YTD YTD YTDActuals Budget Variance

2016 2016 2016

Category

Total Watermain Renewal and Improvements 9,339 11,033 1,694

New Reservoir 3,074 12,338 9,264

GPS Surveying Unit D - 21 21

Hydrants 91 223 132 Valves 60 60 - Services G 245 111 (134) Fill Stations 5 - (5) Tools H - 18 18

Total Transmission and Distribution Projects 401 413 12

Total Meter Projects I 2,620 1,752 (868)

AJ Brian Pumping Station J 9 100 91 Albert H. Weeks WTP K 537 1,244 707 Hanna Street Water Tower - 35 35 Generator Building L 438 290 (148) George Avenue / JF Cook Pumping Station M 60 144 84

Total Water Treatment Facilities 1,044 1,812 768

WATER CAPITAL ONLY 16,479 27,368 10,889

District Energy O 35 53 18

TOTAL WUC CAPITAL EXPENDITURES 16,514 27,420 10,906

Description

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Original Revised September 2016 VarianceWindsor Utilities Commission Budget Budget Actuals Forecast Variance Analysis

Watermain Watermain Renewal & Improvements 14,710 14,710 9,339 14,150 560 All projects tracking on time and as planned.

Watermain Renewal & Improvements 14,710 14,710 9,339 14,150 560

New ReservoNew Reservoir 16,450 16,450 3,074 3,124 13,326 RFP for the Box Phase of the project will close Oct 26th. Construction will not commence until Q1 of 2017.

Reservoir & Feedermain Projects 16,450 16,450 3,074 3,124 13,326 GPS Survey GPS Surveying Unit 28 28 - - 28 No anticipated spend for 2016Engineering Projects 28 28 - - 28 Hydrants Hydrants 297 297 91 110 187 Number tends to pick up in the fall when inspection cycle beginsValves Valves 80 80 60 70 10 There are a couple of feeder valve repairs in the planning stagesServices Services 149 149 245 310 (161) Impacted by a number of lead service replacements that were doneFill Stations Fill Stations - - 5 5 (5) A rebuild on the Deziel station damaged by the Aug 24th tornadoTools Tools 25 25 - 65 (40) In the process of purchasing a large equipment trailer (15K)Transmission & Distribution Projects 550 550 401 560 (10) Meters Water Meter Replacements - WUC 1,680 1,680 797 904 776 WMRP Accelerated Replacement Program - Neptune 656 656 1,823 1,823 (1,167) Funds reallocated from watermain renewalMeters 2,336 2,336 2,620 2,727 (391)

Overhaul pumps 30 30 - - 30 Deferred and consolidated to provide funding for the Mirrlee's Diesel Motor replacement project

Mirlee Mirrlees diesel replacement - - 4 255 (255) Project bid award awaiting board approval. Project is delayed and will take place partially in 2016 and be completed in 2017.

Install VFD on HL1 - - - 250 (250) Project pulled forward from 2017 to replace Mirrlees spending shortfall

Low lift pumps overhaul - install 1 VFD & 1 soft start 76 76 - - 76 Deferred and consolidated to provide funding for the Mirrlee's Diesel Motor replacement project

Weather Sealing - - - 43 (43) Emergency repairsRoof Replace roof - - 5 5 (5) Completed Week of Oct 17 2016

Security System 28 28 - 28 - Out for tender closes Oct 25thAJ Brian Pumping Station 133 133 9 581 (448)

Windsor Utilities Commission2016 Capital Plan Budget to Actuals

(in 000's)

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Original Revised September 2016 VarianceWindsor Utilities Commission Budget Budget Actuals Forecast Variance Analysis

Windsor Utilities Commission2016 Capital Plan Budget to Actuals

(in 000's)

Replace 1 air handling unit 30 30 - 67 (37) Fabricating work was required due to locationReplace 2 medium fans 30 30 - - 30 Reallocated to weather sealing at AJ BrianReplace 4 propeller fans 15 15 - 15 - Consistent to budgetReplace rooftop AC unit 7 7 - - 7 Reallocated to replace air handling unitReplace 1 dehumidifier 30 30 - - 30 Reallocated to replace air handling unitReplace 4 gas fired unit heaters 3 3 - - 3 Reallocated to weather sealing at AJ BrianReplace 2 gas infrared heaters 3 3 - - 3 Reallocated to weather sealing at AJ Brian

Twin O2 feedline from oxygen tank to ozone room 80 80 - - 80 Deferred and consolidated to provide funding for the Mirrlee's Diesel Motor replacement project

Twin water feed to chlorine header 20 20 - - 20 Deferred and consolidated to provide funding for the Mirrlee's Twin hydro feed to George pump station 95 95 - - 95 Deferred and consolidated to provide funding for the Mirrlee's Twin feed to the plant from wyandotte 20 20 - - 20 Deferred and consolidated to provide funding for the Mirrlee's Retork on George pumps (3) 50 50 - - 50 Deferred and consolidated to provide funding for the Mirrlee's Automate clarifier drain valves 20 20 - - 20 Deferred and consolidated to provide funding for the Mirrlee's Two new delpac tanks (same size) 95 95 - - 95 Deferred and consolidated to provide funding for the Mirrlee's Install new tanks for quench agent in chemical building 20 20 - - 20 Deferred and consolidated to provide funding for the Mirrlee's

Ozone Ozone diffusers 50 50 28 28 22 Completed and under budget

Light Plant lighting conversion 95 95 97 130 (35) On schedule for completion in 2016. Variance is a result of completion of prior year project.

AH Roof Replace roof 743 743 348 743 - Phase 1 Completed Security System 54 54 - 54 - Out for tender closes Oct 25th

Waste WaterWaste water sewer connection 200 200 64 89 111 On schedule for completion in 2016.AH Weeks Treatment Plant 1,658 1,658 537 1,124 534

Replace 2 medium fans 30 30 - - 30 Deferred and consolidated to provide funding for MAU

Gen 4 Replace 4 motorized dampers and motors 4 4 21 21 (16) Additional fabricating work was done due to location of replacementReplace 4 gas fired unit heaters 3 3 - - 3 Reallocated to weather sealing at AJ Brian

Genset Genset rebuilds 350 350 418 418 (68) Rebuilds are complete. Core credits have not been received to date which will reduce the total cost.

Generator Building 387 387 438 438 (51) Replace 2 small fans 3 3 - - 3 Reallocated to weather sealing at AJ BrianReplace 2 motorized dampers with motors 1 1 - - 1 Reallocated to weather sealing at AJ BrianReplace 4 electric baseboard heaters 1 1 - - 1 Reallocated to weather sealing at AJ Brian

Pump Rebuild pumps 56 56 60 96 (40) Project has been consolidated with valve overhauls under JF Cook building. Costs are expected to be within budget.

Security System 53 53 - 53 - Out for tender closes Oct 25thGeorge Avenue / JF Cook Pumping Station 114 114 60 149 (36)

Security System 46 46 - 46 - Out for tender closes Oct 25thHanna Street / Benjamin Street Water Towers 46 46 - 46 -

Overhaul valves - recirculation valve (new retork needed) 40 40 - - 40 See previous line item under George Avenue "Rebuild Pumps". These two projects have been consolidated.

Replace chemical systems 39 39 - 39 - Project is scheduled for completion in 2016JF Cook Pumping Station 79 79 - 39 40

Total Water 36,491 36,491 16,479 22,939 13,552

District EnerDistrict Energy 70 70 35 70 - Consistent to budgetDistrict Energy 70 70 35 70 -

Total Windsor Utilities Commission Capital Expenditures 36,561$ 36,561$ 16,514$ 23,009$ 13,552$

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audit & finance committee meeting public...

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