2020 Annual Report

Annual Report 2020 105 TOURISM CHILLIWACK INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Year Ended December 31, 2020 TOURISM CH LLIWACK INC. Notes to Consolidated Financial Statements Year ended December 31, 2020 Basis of presentation: Tourism Chilliwack Inc. (the "Company") was incorporated on December 16, 2006 and began operations on January 1, 2007. The Company is wholly-owned by the City of Chilliwack. The mandate of the Company is to develop and promote the tourism industry as well as provide economic development programs and services aimed at growing the tourism industry in the City of Chilliwack. 1. Significant accounting policies: These financial statements are prepared in accordance with the CPA Canada Public Sector Accounting Handbook. The Company's significant accounting policies are as follows: (a) Basis of consolidation: The consolidated financial statements include all of the funds of the Company. Inter-fund transactions, fund balances and activities have been eliminated on consolidation. The funds of the Company include Facility Management, Tourism Services and Retail Services. (b) Investments: Investments are recorded at amortized cost plus accrued interest. If it is determined that there is a permanent impairment in the value of an investment, it is written down to net realizable value. (c) Inventories: Inventories are measured at the lower of cost and net realizable value by using first-in, first- out costing methodology. The Company uses the same cost formula for all the inventories having a similar nature and use to the entity. When circumstances which previously caused inventories to be written down no longer exist the previous impairment is reversed. (d) Tangible capital assets: Tangible capital assets are stated at cost, less accumulated amortization. Amortization is provided using the declining balance method at the following annual rates: Asset Rate Furniture and fixtures 30% Computers 30% Leasehold improvements 30% Website 45% Works of art and cultural and historical assets are not recorded as assets in these financial statements. Purchased works of art are expensed in year acquired. 5