City records a surplus in the 2019 budget; they call that a favourable variance - most of the upside came from investments

News 100 redBy Pepper Parr

April 9th, 2020



We are not likely to see numbers like these in the 2020 financials – linger over them.

Surplus graphic

Most financial statements use the phrase profit/loss or surplus/deficit. Municipalities are different – they refer to what we know as a surplus as a “positive variance” and what we know as a deficit is a “negative variance”.

Municipalities are not permitted to have a loss – which is why they have reserves; funds they can draw upon when a particular account eats up what the departments had budgeted.

Snow removal is one account that is almost impossible to budget for – the 2014 flood was another example. When they need funds for unexpected events like these – they turn to a reserve fund.

The Tax Stabilization fund is the “piggy bank” that gets tapped frequently. It is also the account that any “surplus” or positive variance gets deposited into.

Where were the budgets over and under from the Strategic Plan viewpoint?

Op budget perf 2019

The four strategic plan pillars – how the budget was allocated.

Spending looked at from a departmental viewpoint.  Where things went well and where things slipped up.

The expensive mistake of getting the Customer Service software in place and operation isn’t reflected in this report – some questions to ask at this level.

The earnings on investment appears to be what made the positive variance.

Does this report give the city finance department an A or a C?

Acct document

Corp rev part 2 of acct doc

The investment revenue sort of papered over the problem areas.

This report provides an overview of the financial performance of the 2019 Operating Budget and additional variance commentary for select services as at December 31, 2019.

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