Financial Statements

Financial Statements of CANADIAN GUIDE DOGS FOR THE BLIND Year ended December 31, 1999

AUDITORS' REPORT TO THE DIRECTORS We have audited the statement of financial position of Canadian Guide Dogs for the Blind as at December 31, 1999 and the statements of operations, changes in net assets and cash flows for the year then ended. These financial statements are the responsibility of the organization's management. Our responsibility is to express an opinion on these financial statements based on our audit. Except as explained in the following paragraph, we conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. The organization derives revenue, the completeness of which is not susceptible of satisfactory audit verification, except for testamentary bequests, Patron's account and investment income. Accordingly, our verification of revenues other than testamentary bequests, Patron's account income and investment income was limited to the amounts recorded in the records of the organization and we were not able to determine whether any adjustments might be necessary to revenue, excess of revenue over expense, assets and net assets. In our opinion, except for the effect of adjustments, if any, which we might have determined to be necessary had we been able to satisfy ourselves concerning the completeness of the revenue referred to in the preceding paragraph, these financial statements present fairly, in all material respects, the financial position of the organization as at December 31, 1999 and results of its operations and cash flows for the year then ended in accordance with Canadian generally accepted accounting principles. As required by the Canada Corporations Act we report that, in our opinion, these principles have been applied on a basis consistent with that of the preceding year. Chartered Accountants Ottawa, Canada February 3, 2000

CANADIAN GUIDE DOGS FOR THE BLIND Statement of Financial Position December 31, 1999, with comparative figures for 1998 1999 1998 Assets Current assets: Cash $ 588,355 $ 943,104 Amounts receivable 57,092 45,095 Accrued investment income 10,823 8,136 Inventory 59,052 43,160 Prepaid expenses 1,935 1,759 717,257 1,041,254 Long-term investments 460,895 250,000 Restricted cash (note 1(h)) 20,000 10,000 Restricted patron's account assets – 31,867 Pledges receivable 2,000 26,000 Capital assets (note 2) 785,409 777,157 $ 1,985,561 $ 2,136,278 Liabilities and Net Assets Current liabilities: Accounts payable and accrued liabilities $ 32,747 $ 28,188 Deferred contributions 2,000 26,000 Deferred patron's account revenue – 31,867 Deferred capital contributions 51,500 27,000 Other deferred revenue 4,900 45,050 Net assets: Invested in capital assets 733,911 750,157 Heather Gillin Endowment Fund 20,000 10,000 Unrestricted 1,140,503 1,218,016 1,894,414 1,978,173 Deferred gifts (note 5) $ 1,985,561 $ 2,136,278 See accompanying notes to financial statements. On behalf of the Board: _______________________ Director _______________________ Director

CANADIAN GUIDE DOGS FOR THE BLIND Statement of Operations Year ended December 31, 1999, with comparative figures for 1998 1999 1998 Revenue: Contributions: Individuals $ 177,660 $ 239,385 Testamentary bequests 85,031 147,715 Corporations 44,939 42,025 Other foundations 31,675 33,019 Clubs and associations 32,799 28,477 Donations in kind 18,271 17,551 User donations 3,692 2,264 394,067 510,436 Guiders and fundraising activities 390,642 384,888 BC Branch income 212,937 269,726 Chapter income 192,552 183,934 Patron's account 34,490 28,741 Investment income 37,675 28,864 Donations - life insurance policies 24,673 18,090 Dog sales 16,534 17,842 Merchandise sales (net of expenses of $14,082) 12,538 4,676 1,316,108 1,447,197 Expenses: Training 353,148 334,143 BC Branch 287,495 232,251 Dogs 80,652 71,674 Users 63,189 41,457 Property 43,663 43,841 Vehicles 23,379 31,817 Chapters 24,796 22,899 Administration 173,926 185,695 Guiders and fundraising 296,629 263,205 Amortization of capital assets 62,990 66,268 1,409,867 1,293,250 Excess (deficiency) of revenue over expenses $ (93,759) $ 153,947 See accompanying notes to financial statements.

CANADIAN GUIDE DOGS FOR THE BLIND Statement of Changes in Net Assets Year ended December 31, 1999, with comparative figures for 1998 Heather Gillin Invested in Endowment Total Total capital assets Fund Unrestricted 1999 1998 Net assets, beginning of year $ 750,157 $ 10,000 $ 1,218,016 $ 1,978,173 $ 1,814,226 Excess (deficiency) of revenue over expenses – – (93,759) (93,759) 153,947 Endowment contributions (note 1(h)) – 10,000 – 10,000 10,000 Amortization of capital assets (62,990) – 62,990 – – Capital asset additions 71,244 – (71,244) – – Amortization of deferred capital contribution 6,750 – (6,750) – – Increase in deferred capital contribution (31,250) – 31,250 – – Net assets, end of year $ 733,911 $ 20,000 $ 1,140,503 $ 1,894,414 $ 1,978,173 See accompanying notes to financial statements.

CANADIAN GUIDE DOGS FOR THE BLIND Statement of Cash Flows Year ended December 31, 1999, with comparative figures for 1998 1999 1998 Cash provided by (used in): Operations: Excess (deficiency) of revenue over expenses $ (93,759) $ 153,947 Items not involving cash: Amortization of deferred capital contributions (6,750) – Amortization of capital assets 62,990 66,267 Gain on disposal of capital assets (11,842) – Change in non-cash operating working capital (note 3) (66,343) 22,196 (115,704) 242,410 Investments: Deferred capital contribution 31,250 27,000 Endowment contributions (10,000) (10,000) Restricted cash 10,000 10,000 Purchase of capital assets (71,244) (840) Proceeds on disposal of capital assets 11,842 – Long-term investments acquired (210,895) (250,000) (239,047) (223,840) Increase (decrease) in cash (354,751) 18,570 Cash and short-term investments, beginning of year 943,104 924,534 Cash and short-term investments, end of year $ 588,353 $ 943,104 Cash and short-term investments excludes restricted assets. See accompanying notes to financial statements.

CANADIAN GUIDE DOGS FOR THE BLIND Notes to Financial Statements Year ended December 31, 1999 Canadian Guide Dogs for the Blind was incorporated under Part II of the Canada Corporations Act on January 12, 1984 and is a registered charity under the Income Tax Act (Canada). Its objectives are to provide trained and educated dogs to act as efficient and safe guides for blind persons and to train and educate blind persons in the proper and safe use of guide dogs and to provide such additional services and facilities for the relief of blind persons as shall from time to time be deemed necessary. 1. Significant accounting policies: (a) Cash: Cash includes deposits with financial institutions that can be withdrawn without prior notice or penalty and short-term deposits with an original maturity of ninety days or less. (b) Revenue: Pledges, bequests and interest are recorded on the accrual basis. All other contributions and donations are recorded as revenue when received. Pledges for subsequent years are recorded as deferred contributions. (c) Inventory: Inventory is carried at the lower of cost and estimated net realizable value. (d) Capital assets: Capital assets are recorded at cost and are amortized on the straight-line basis over the estimated useful life of the assets as noted below. Asset Rate Training centre and kennels 40 years Site development 20 years Furniture, furnishings and equipment 5-10 years Vehicles 4 years Collecting boxes 4 years

CANADIAN GUIDE DOGS FOR THE BLIND Notes to Financial Statements, page 2 Year ended December 31, 1999 1. Significant accounting policies (continued): (e) Deferred capital contributions: Contributions restricted for the purpose of capital assets are deferred and amortized into revenue on a straight-line basis, at a rate corresponding with the amortization rate for the related capital assets. (f) Investments: Investments are recorded at cost. (g) Restricted assets: Restricted assets represent amounts donated by a Patron for apprentice education. (h) Endowment: Net assets restricted for endowment purposes are subject to externally imposed restrictions stipulating that the resources must be maintained permanently. Investment income on this amount is unrestricted. (i) Use of estimates: The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

CANADIAN GUIDE DOGS FOR THE BLIND Notes to Financial Statements, page 3 Year ended December 31, 1999 2. Capital assets: 1999 1998 Accumulated Net book Net book Cost amortization value value Land $ 79,560 $ – $ 79,560 $ 79,560 Training centre and kennels 802,224 242,210 560,014 579,979 Site development 171,924 97,926 73,998 82,595 Furniture, furnishings and equipment 214,413 204,579 9,834 9,830 Vehicles 189,276 129,325 59,951 21,088 Collecting boxes 185,957 183,905 2,052 4,105 $ 1,643,354 $ 857,945 $ 785,409 $ 777,157 Cost and accumulated amortization of capital assets at December 31, 1998 amounted to $1,629,712 and $852,555. 3. Statement of cash flows: Change in non-cash operating working capital is as follows: 1999 1998 Amounts receivable $ (11,997) $ (8,971) Accrued investment income (2,687) (5,991) Inventory (15,892) (12,457) Prepaid expenses (176) – Accounts payable and accrued liabilities 4,559 8,165 Other deferred revenue (40,150) 41,450 $ (66,343) $ 22,196

CANADIAN GUIDE DOGS FOR THE BLIND Notes to Financial Statements, page 4 Year ended December 31, 1999 4. Financial instruments: For certain of the Organization's financial instruments, including short-term investments, amounts receivable, accrued investment income and accounts payable and accrued liabilities, the carrying amounts approximate fair value due to the immediate or short-term maturity of these financial instruments. The fair value of the pledges receivable could not be determined as there is no market for this financial asset. The carrying amount and fair value of the long-term investments are as follows: 1999 1998 Carrying Fair Carrying Fair amount value amount value Savings bonds - unrestricted $ 460,895 $ 467,240 $ 250,000 $ 255,029 5. Deferred gifts: (a) Charitable Remainder Trust: The Organization has been designated the beneficiary of a Charitable Remainder Trust. At December 31, 1999, the estimate of the amount from the Charitable Remainder Trust to be received in future years is $100,000. This amount is not recorded in the accompanying financial statements. (b) Funds: The Organization has two funds established at the Community Foundation of Ottawa. The capital of these funds shall be held permanently by the Foundation and as such are not recorded in the accompanying financial statements.

CANADIAN GUIDE DOGS FOR THE BLIND Notes to Financial Statements, page 5 Year ended December 31, 1999 6. Uncertainty due to the Year 2000 Issue: The Year 2000 Issue arises because many computerized systems use two digits rather than four to identify a year. Date-sensitive systems may recognize the year 2000 as 1900 or some other date, resulting in errors when information using year 2000 dates is processed. In addition, similar problems may arise in some systems which use certain dates in 1999 to represent something other than a date. Although the change in date has occurred, it is not possible to conclude that all aspects of the Year 2000 Issue that may affect the Organization, including those related to customers, suppliers, or other third parties, have been fully resolved. 7. Comparative figures: Certain 1998 comparative figures have been reclassified to conform with the financial statement presentation adopted for 1999.

Financial Statements

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