Cornwall had ‘excellent year’ financially despite what audited statements say: auditor

In this April 2019, file photo, MNP accountants Jamie Pollock and Ross Markell speak to Cornwall City Council. Pollock presented the 2019 financial statements to council on Monday, June 29, 2020. (Newswatch Group/Bill Kingston, FIle)

CORNWALL – The city’s auditor says Cornwall had a “very excellent year” financially despite what the figures say in the 2019 audited financial statements for the municipality.

Jamie Pollock of MNP presented the audit results to council during a special meeting Monday night.

“You are in much better financial shape than these statements are telling you,” Pollock stated.

The statement of financial position shows Cornwall ended up with a $6.5 million deficit in 2019, compared to an $18.6 million surplus in 2018.

As part of accounting rules, the city had to put a $16.7 million charge on the books in 2019 for the future closure of the landfill. It really isn’t debt right now but a future liability as the city plans for its closure in 2032, where costs are expected to reach $38 million by then.

There was also an expense of just over $5 million that the city had to pay back to Walmart as part of a settlement in October 2019 around a municipal property assessment appeal on two of its distribution centers.

Had it not been for those two items, the city would have been in the black by $3.3 million, Pollock said.

The city had planned for the appeal settlement and stockpiled cash the year before, but it also drew down its operating reserves for the payout from $8.6 million to $3.7 million – a reserve account Pollock suggested was on the “low side” and would need to be topped up again. The target amount for the operating reserve is $7.4 million.

Looking forward, Mayor Bernadette Clement asked how things were looking for 2020 with the fallout of the coronavirus pandemic.

Pollock says the city’s reserves will help weather the storm but it may have to look at “maybe postponing some capital projects…without really auditing your 2020 figures, I believe the city will be able to handle this pandemic quite well…you’re in a strong financial position.”

“The municipality would weather this very well and I won’t be surprised, you’ll be just as strong at the end of it as you were going into this unfortunate situation.”

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