SASKATCHEWAN ALFALFA SEED PRODUCERS DEVELOPMENT COMMISSION

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1 Box 114 Middle Lake, Saskatchewan S0K 2X ANNUAL REPORT The Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) was established on July 24, 1997 and is currently in its twentieth year of operation. The 20 th SASPDC annual business meeting will be held in Saskatoon on January 13 th, The current SASPDC board is comprised of the following directors: (elected at the 2017 AGM) Jason Veikle, Chairman, Cut Knife, SK Evan LeBras, Vice-Chairman, Arborfield, SK Don Payak, Weyburn, SK David Espenant, Hudson Bay, SK Jeffrey Freedman, Ridgedale, SK Landon Thack, Hudson Bay, SK Guenette Bautz, SASPDC Administrator, Middle Lake, Sk Wayne Goerzen, Research Scientist, Saskatoon, SK Establishment of the Commission The process leading to the establishment of the Commission was initiated by the Saskatchewan Alfalfa Seed Producers Association (SASPA). The intent of the alfalfa seed producers was to establish a commission whereby producer funding could be utilized in areas of research and development in order to benefit the alfalfa seed industry in Saskatchewan. A lengthy period of consultation with alfalfa seed producers in the province was undertaken with the advice and assistance of the Agri-Food Council. Following this consultation period, a producer vote was held in January, 1996 at a well-publicized general meeting of alfalfa seed producers in Saskatoon, with representation from the Agri-Food Council in attendance. At the meeting, the implementation of an alfalfa seed levy was strongly supported by alfalfa seed producers. The Commission was formally established on July 24, 1997 and collection of the levy commenced on August 01, Initially, the levy was set at $ (3/4 of one cent) per pound of alfalfa seed. The levy is mandatory in nature and completely refundable to producers twice each year. Purpose of the Commission The general purpose and intent of the Commission is to provide for the orderly and effective development of the alfalfa seed industry in Saskatchewan. Specific purposes of the Commission are: 1. To promote and develop the alfalfa seed and alfalfa leafcutter bee industries in Saskatchewan; 2. To develop procedures to maximize returns to producers; 3. To encourage the production of a uniform high-quality product; 4. To gather, compile, and distribute information related to the production of alfalfa seed and the management of alfalfa leafcutter bees; 5. To conduct and encourage research on the production of alfalfa seed and the management of alfalfa leafcutter bees; 6. To promote and improve understanding among individuals and organizations within the alfalfa seed and alfalfa leafcutter bee industries; 7. To establish a system of levies on alfalfa seed crops for carrying out the purposes of the Commission; and

2 8. To represent and lobby on behalf of registered producers in matters relating to the development of the alfalfa seed and alfalfa leafcutter bee industries. Mandate of the Commission The Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) was established to assist in the development of the alfalfa seed and alfalfa leafcutter bee industry in Saskatchewan. As the level of government funding available for research and development decreases, the SASPDC allows alfalfa seed producers to take on a role in the funding of research and development. Through the SASPDC, producers have major input in the utilization of levy funds collected; collection of the levy also makes it possible for the alfalfa seed and alfalfa leafcutter bee industries to match funds with government under new funding initiatives in order to support research and development projects in which the alfalfa seed producers are directly involved. Research Priorities of the Commission Consultation to determine the research priorities of Saskatchewan alfalfa seed producers is ongoing. Research projects currently underway include the following initiatives: 1. SASPDC disease monitoring & Agrologist monitoring initiative The Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) alfalfa disease research project was initiated in 2001 with producer-cooperators establishing large-scale fungicide treatment plots in alfalfa seed fields at locations throughout the province. This research project was subsequently expanded to include the collection of weather data. The objectives of this research project were to develop fungicide application recommendations and to utilize weather data in order to predict disease potential / disease severity. Saskatchewan alfalfa seed producers were thus able to utilize information from this research project in making fungicide application decisions. The current SASPDC weather network & Agrologist monitoring initiative, undertaken during the 2009, 2010, 2011, 2012, 2013, 2014, 2015 AND 2016 field seasons, has involved establishing a network of weather stations deployed in alfalfa seed production areas throughout Saskatchewan in order to collect key meteorological data required for development of an alfalfa disease forecasting system. This research initiative has supported the preparation of alfalfa disease risk reports for circulation to alfalfa seed producers throughout the province. 2. Alfalfa leafcutter bee parasite and disease control research The alfalfa leafcutter bee is an important pollinator of alfalfa grown for seed production which has been used by Saskatchewan alfalfa seed producers as a dependable pollinator for over forty years. Factors which may limit alfalfa leafcutter bee reproduction in Saskatchewan include infestations of chalcid parasites and incidence of fungal pathogens. Since these factors have the potential to damage Saskatchewan alfalfa leafcutter bee populations, the objective of ongoing research undertaken by the SASPDC is to develop parasite and disease control strategies which will assist Saskatchewan alfalfa seed producers in maintaining high quality alfalfa leafcutter bee populations, thus enhancing bee reproduction and alfalfa seed production. Parasite control research currently underway involves investigation into the use of essential oil and volatile organic compounds, along with evaluation of a potential parasite male-killing bacterium. Disease control research involves work with anti-microbial compounds and evaluation of pollinator bio-control vector technology. Utilization of newly-developed parasite and disease control strategies by producers

3 will increase the value of Saskatchewan alfalfa leafcutter bees as pollinators in the hybrid canola seed production and blueberry production sectors, and in conventional alfalfa seed production export markets. The current SASPDC alfalfa leafcutter bee research project "Development of new strategies for control of parasites and disease in alfalfa leafcutter bee populations" is co-funded by the Agriculture Development Fund (ADF), the Western Grains Research Foundation (WGRF), and the SASPDC. 3. Initiatives in support of the registration of pest control products In order to facilitate the registration of pest control products required by the alfalfa seed industry, the Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) is a member of the Prairie Pesticide Minor Use Consortium (PPMUC). This consortium of western Canadian producer organizations works to obtain user-requested minor use label expansions (URMULE) for pest control products currently registered in Canada on other crops, user-requested minor use registrations (URMUR) for pest control products registered in the USA or OECD countries but not in Canada, and emergency pest control product registrations. Membership in the PPMUC has allowed the SASPDC to obtain minor use registrations for fungicides, herbicides, and insecticides which are important management tools for use in alfalfa seed production. 4. Prevention and Management of Chalkbrood in Leafcutter Bees (Pollinators) Saskatchewan alfalfa seed growers are diligent producers that are committed to insuring the provinces bee population is free of disease. The SASPDC continues to support the Canadian Coccoon testing centre and encourage producers to submit samples to the Canadian Coccoon testing centre for the testing of Chalkbrood for prevention and management purposes. Previous Projects of the Commission 1. Promotion of alfalfa as a forage crop in North America The Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) with co-funding from Canadian Adaptation and Rural Development Saskatchewan (CARDS), worked to develop a publication for promotion of alfalfa as a forage crop throughout North America. This promotional publication outlines the dependability of alfalfa as a forage crop and also highlights the nutritional, economic, and conservation advantages associated with growing and utilizing alfalfa as a forage crop in dairy and beef operations. By targeting groups including dairy and beef producers throughout Canada and the midwestern United States, many of whom are currently growing corn or other crops for silage feed, sales of Canadian alfalfa seed into new Canadian and U.S. markets will serve to increase the value of Canadian alfalfa seed and stabilize alfalfa seed prices over a long-term period. 2. Understanding changes in alfalfa seed and forage markets In order to better understand the role of alfalfa seed in North American forage markets, the Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) contracted agricultural economists in the University of Saskatchewan Department of Agricultural Economics to undertake a market research initiative entitled Understanding changes in the alfalfa seed and forage market. This market research study is of importance to western Canadian alfalfa seed producers in that it seeks to provide understanding of factors involved in changing alfalfa seed market conditions. The key information provided in the final report of this market research initiative has assisted alfalfa seed producers in the development of strategic planning to ensure the future of the western Canadian alfalfa

4 seed industry. The project was co-funded by the SASPDC, the Alfalfa Seed Commission (Alberta) and the Manitoba Forage Seed Association (MFSA). Overview of the Saskatchewan Alfalfa Seed Industry Alfalfa seed production in Saskatchewan is undertaken on over 35,000 acres, representing about 60% of the alfalfa seed acreage in Canada and making Saskatchewan the largest alfalfa seed production area in the world. Alfalfa leafcutter bee populations, estimated at 20,000-25,000 bees per acre, have grown to a total of about 1.25 billion bees. Under ideal conditions, this population doubles each year and the excess production is marketed for pollination of alfalfa grown for seed production throughout the northwestern U.S., for pollination of hybrid canola for seed production in southern Alberta and the western U.S., and for pollination of lowbush blueberry in the Atlantic provinces and the Lac St. Jean region of Quebec. Saskatchewan alfalfa leafcutter bee sales currently total $13 - $14 million each year, while the value of Saskatchewan alfalfa seed production is $16 - $18 million annually. The value of hybrid canola seed production on 50,000 acres in southern Alberta is in excess of $325 million annually. The pollination requirements for production of this valuable crop involve utilizing 50% alfalfa leafcutter bees and 50% honeybees; most of the alfalfa leafcutter bees used in the hybrid canola seed production area are produced by Saskatchewan alfalfa seed producers. SASPDC Approved Budget 2015 / 2016 A copy of the SASPDC 2015 / 2016 budget, approved by the SASPDC board of directors at the July 25, 2016 directors teleconference meeting, is attached as an appendix to this report. The SASPDC 2015 / 2016 budget was presented to the membership at the 20 th SASPDC annual meeting held in Saskatoon on January 13 th, SASPDC Reporting Standards Certification A copy of the Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) Reporting Standards Certification document, signed and dated by the SASPDC Audit Chair, is attached to this report as required by the Agri-Food Council under the authority of The Agri-Food Act, SASPDC Financial Statements for the 2015 / 2016 fiscal year The Saskatchewan Alfalfa Seed Producers Development Commission (SASPDC) audited financial statements for the fiscal year August 01, July 31, 2016 are included with this report. These financial statements, prepared according to Agri-Food Council guidelines, include an audit report on the financial statements, an audit report on internal rules and procedures to safeguard and control assets, an audit report on compliance with authorities, and a statement comparing actual results to budgeted results.

5 SASPDC payee list for period August 01, July 31, 2014 CATEGORY AMOUNT Personal Services D. Espenant - SASPDC directors expenses $530 J. Veikle - SASPDC directors expenses $320 E. LeBras - SASPDC directors expenses $441 D. Payak - SASPDC directors expenses $659 B. Mennie - SASPDC directors expenses $515 J. Altwasser, SASPDC levy collector - levy collection fees / expenses $4,209 G. Bautz, SASPDC Administrator travel expenses $387 W. Goerzen, SASPDC Research Scientist travel expenses $3,616 Research and Development Hope Floats Services Inc. - weather network & disease monitoring initiative $15,628 Prairie Pesticide Minor Use Consortium - minor use registration development $5,250 SLA / Radisson Hotel Saskatoon - SASPDC 2013 annual general meeting $2,000 Sask. Leafcutters Assoc. - alfalfa seed / leafcutter bee research initiatives / administration $7,500 SASPDC LCB Research Project $30,000 CUETS Financial LCB research project supplies $2,729 Sask Leafcutters Association Research / Special Projects Funding Support $7,500 Supplier Payments Milton and Associates, Chartered Accountant - SASPDC audit / financial statements $2,530 Innovation Place Research Park - SASPDC office space / research storage space $9,727 Wayne Goerzen SASPDC research scientist $70,000 Note: This list includes payees over the $1, threshold, as established by the SASPDC board of directors, and is prepared according to Agri-Food Council guidelines. A copy of the SASPDC payee list is available to any Saskatchewan alfalfa seed producer upon request.

6 (SASPDC) SASPDC BOARD APPROVED BUDGET August 1, 2015 July 31, 2016 INCOME Budget Income $95,000 EXPENDITURES SASPDC Extension & Tech Transfer / Support 15,000 SASPDC alfalfa seed / leafcutter bee production research initiatives 20,000 Annual Meeting Expense 2,000 SASPDC disease monitoring & agrologist services initiative 19,500 SASPDC office / administrative expenditures 10,000 SASPDC Administration 7,500 SASPDC directors expenses 6,000 SASPDC technology transfer / fall research letter 2,000 Prairie Pesticide Minor Use Consortium (PPMUC) 5,500 SASPDC annual audit 2,500 SASPDC levy collection expenses 5,000 Total $ 95,000

7 TWIGG & COMPANY CHARTERED ACCOUNTANTS J.S. TWIGG B.Comm., C.A. L.D. SAFINUK B. Comm., C.A 650 REGENCY CENTER th STREET EAST SASKATOON, SK. S7K 0L4 M. LINGARD B. Comm., MPAcc., C.A. TELEPHONE (306) FACSIMILE (306) SASKATCHEWAN ALFALFA SEED PRODUCERS DEVELOPMENT COMMISSION AUDITED FINANCIAL STATEMENTS for the year ended July 31, 2016

8 TWIGG & COMPANY CHARTERED ACCOUNTANTS J.S. TWIGG B.Comm., C.A. L.D. SAFINUK B. Comm., C.A 650 REGENCY CENTER th STREET EAST SASKATOON, SK. S7K 0L4 M. LINGARD B. Comm., MPAcc., C.A. Independent Auditors Report TELEPHONE (306) FACSIMILE (306) To the Members of Saskatchewan Alfalfa Seed Producers Development Commission. Report on the Financial Statements We have audited the accompanying financial statements of Saskatchewan Alfalfa Seed Producers Development Commission, which comprise the statement of financial position as at July 31, 2016 and the statements of operations, changes in net assets, and cash flows for the year the ended, and a summary of significant accounting policies and other explanatory information. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian accounting standards for not-for-profit organizations, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatements, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

9 TWIGG & COMPANY CHARTERED ACCOUNTANTS J.S. TWIGG B.Comm., C.A. L.D. SAFINUK B. Comm., C.A 650 REGENCY CENTER th STREET EAST SASKATOON, SK. S7K 0L4 M. LINGARD B. Comm., MPAcc., C.A. Independent Auditors Report TELEPHONE (306) FACSIMILE (306) Independent Auditors Report (continued) (continued from page 1) Basis for Qualified Opinion The Commission collects a levy fee from Saskatchewan producers through buyers of alfalfa seed. It was not practical for us to verify whether all buyers of alfalfa seed produced in Saskatchewan have collected and remitted the required levy fee to the commission and as such the completeness of the related revenue does not lend itself to satisfactory audit verification. Accordingly, our verification of the levy fee revenue was limited to the amounts recorded in the accounts of the commission. As such, we were unable to determine whether any adjustments might be necessary to revenue, deficiency of revenue over expenses, assets, liabilities, net assets and cash flows of the Commission. Qualified Opinion In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, these financial statements present fairly, in all material respects, the financial position of Saskatchewan Alfalfa Seed Producers Development Commission as at July 31, 2016 and the results of its operations and cash flows for the year then ended in accordance with Canadian accounting standards for not-for-profit organizations. The financial statements as at July 31, 2015 and for the year then ended were audited by other auditors who expressed an unqualified opinion on those statements in their report dated October 23, January 23, 2017 Saskatoon, Saskatchewan Chartered Accountants

10 STATEMENT OF FINANCIAL POSITION as at July 31, 2016 ASSETS CURRENT: Cash $ 137,532 $ 161,139 Accounts receivable (Note 3) - 5, , ,219 INTERNALLY RESTRICTED INVESTMENT (Note 5) 100, ,199 LIABILITIES $ 237,932 $ 266,418 CURRENT: Accounts payable (Note 4) 3,445 4,872 Deferred revenue (Note 2(a)) 3,648 - NET ASSETS 7,093 4,872 INTERNALLY RESTRICTED (Note 5) 100, ,000 UNRESTRICTED 130, , , ,546 $ 237,932 $ 266,418 APPROVED BY THE BOARD: Director Director

11 STATEMENT OF OPERATIONS for the year ended July 31, Budget Actual Actual (Unaudited) REVENUE (Note 7) Levy revenue (Note 6) $ - $ 76,255 $ 49,466 Less levy refund - ( 2,802) ( 2,300) 73,453 47,166 Agrologist services monitoring initiative - 23,855 25,065 IODF Funding - 3,400 5,000 SASPDC LCB research grants - 20,409 77,728 SLA contribution - - 4,600 Interest , , ,302 EXPENSES Research Agrologist services monitoring initiative 34,500 11,171 16,608 LCB research project - 91, ,703 Memberships Other research/development Prairie pesticide minor use consortium 5,500 5,250 5,250 SASPDC administrator 7,500 7,500 7,500 SASPDC alfalfa seed/leafcutter bee research initiatives 20,000 1,222 1,222 SASPDC office 2,000 2,233 2,141 IODF funded project - 7, , , ,547 Administrative Bad debt Director s expenses 6,000 2,729 4,273 SASPDC audit 2,500 5,530 2,475 Office and administration 12,000 12,254 10,404 20,500 20,708 17,152 Levy collection Levy collection salary 5,000 2,400 2,400 Levy collection administration expenses - 1,535 1,150 5,000 3,935 3,550 95, , ,249 DEFICIENCY OF REVENUE OVER EXPENSES FOR THE YEAR $ - $( 30,707) $( 16,947)

12 STATEMENT OF CHANGES IN NET ASSETS for the year ended July 31, 2016 Internally Restricted Unrestricted Total Total NET ASSETS, BEGINNING OF YEAR $ 100,000 $ 161,546 $ 261,546 $ 278,493 Deficiency of revenue over expenses - ( 30,707) ( 30,707) ( 16,947) NET ASSETS, END OF YEAR $ 100,000 $ 130,839 $ 230,839 $ 261,546

13 STATEMENT OF CASH FLOWS for the year ended July 31, OPERATING ACTIVITIES Deficiency of revenue over expenses $ ( 30,707) $ ( 16,947) Changes in non-cash working capital balances related to operations: Accounts receivable 5080 ( 4,884) Accounts payable ( 1,427) 965 Deferred revenue 3,648-7,301 ( 3,920) Total from operating activities ( 23,406) ( 20,866) DECREASE IN CASH DURING THE YEAR ( 23,406) ( 20,866) CASH AND EQUIVALENTS, BEGINNING OF YEAR 261, ,204 CASH AND EQUIVALENTS, END OF YEAR $ 237,932 $ 261,338 CASH AND EQUIVALENTS, CONSIST OF : Cash 137, ,139 Term deposits internally restricted 100, ,199 $ 237,932 $ 261,338

14 NOTES TO FINANCIAL STATEMENTS for the year ended July 31, DESCRIPTION OF BUSINESS The Saskatchewan Alfalfa Seed Producers Development Commission (Commission) is a nonprofit organization which was established in 1997 under the Agri-Food Act of Saskatchewan. The mission of Commission is to promote and enhance alfalfa seed production in Saskatchewan for maximum return to producers through research, leadership and communication in the industry. 2. SIGNIFICANT ACCOUNTING POLICIES These financial statements are prepared in accordance with Part III of the CPA Handbook Accounting Standards for Not-for Profit Organizations, which sets out generally accepted accounting principles for not-for-profit organizations in Canada and includes the significant accounting policies summarized below. (a) Revenue recognition: The organization follows the deferral method of accounting for contributions, which include government funding and grants. Restricted contributions are recognized as revenue in the year in which the related expenses are incurred or restrictions met. Unspent amounts are included in deferred contributions. Unrestricted contributions are recognized as revenue when received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured. Levy revenue is recognized at the time of settlement. Levy revenue received related to the following year is included in deferred revenue. Interest revenue are recognized as earned. (b) Cash and cash equivalents: Cash and cash equivalents consist of balances with banks and short-term investments with maturities of less than a year. (c) Grants and research and development expense recognition: Research and development expenditures are recognized when grants and / or projects are approved and the recipient has met eligibility criteria. Funds advanced to recipients prior to meeting eligibility criteria are recorded as advances.

15 NOTES TO FINANCIAL STATEMENTS for the year ended July 31, SIGNIFICANT ACCOUNTING POLICIES (continued) (d) Income taxes: No provision for income taxes has been made in these financial statements as the Commission is exempt from income tax under Section 149 (1) of the Income Tax Act. (e) Financial instrument classification: Investments and internally restricted investments are recorded at fair value. Transactions are recorded on a trade basis and transaction costs are expensed as incurred. Other financial instruments, including cash, accounts receivable, accounts payable and accrued liabilities, are initially recorded at their fair market value and are subsequently measured at amortized cost, net of any provisions for impairment. (f) Use of estimates: The preparation of financial statements in conformity with Canadian accounting standards for notfor-profit organizations 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 balance sheet date and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Significant estimates include, but are not limited to the valuation of accounts receivable and the accounts payable. 3. ACCOUNTS RECEIVABLE Levy receivables $ - $ 2,085 Other receivables - 2,995 $ - $ 5,080

16 NOTES TO FINANCIAL STATEMENTS for the year ended July 31, ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Research payable $ - $ 4,597 Accrued audit fee 3,000 - Accrued levy collection administration expense Accrued levy collection salary Accrued SASPDC/ LCB research expense $ 3,445 $ 4, INTERNALLY RESTRICTED NET ASSETS The Commission s Board has internally restricted net assets. The amount is fully funded by investment in guaranteed investment certificates and is not available for other purpose without the approval of the Board. The Commission is currently holding $100,000 ( $100,000) in internally restricted investments. 6. PRODUCER FUND LEVY Under current regulations, each buyer of alfalfa seed is required to remit a levy that is deducted from any payments made to producers. Pursuant to the Agri-Food Act, 2004 Order No. 13/15, the levy was set at $1.25 per pound ( $.75 per pound) of alfalfa seed. Producers can request a refund for any levy paid from February 1 to July 31 by submitting a refund application by July BUDGETED FIGURES Budgeted figures are unaudited and are based on the budget approved by the board in July 2015 and presented at the Annual General Meeting. No revisions were made after this date. 8. FINANCIAL INSTRUMENTS Interest rate risk Interest rate risk is the risk that the value of a financial instrument might be adversely affected by a change in the interest rates. Changes in market interest rates may have an effect on the cash flows associated with some financial assets and liabilities, known as cash flow risk, and on the fair value of other financial assets or liabilities, known as price risk. The Commission is exposed to interest rate risk on its investments.

17 NOTES TO FINANCIAL STATEMENTS for the year ended July 31, FINANCIAL INSTRUMENTS (continued) Credit risk Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Commission is exposed to credit risk on the accounts receivable from its members, however, it does not have significant exposure to any individual member. In order to reduce its credit risk, the Commission regularly reviews outstanding accounts receivable and follow internal collection policies. Liquidity risk Liquidity risk is the risk that an entity will encounter difficulty in meeting its obligations associated with financial liabilities. The Commission s exposure to liquidity risk is dependent upon the receipt of funds from its operations and other sources. Funds from these sources are primarily used to finance working capital and capital expenditures and are considered adequate to meet the commission s obligations. 9. COMPARATIVE FIGURES Certain 2015 comparative figures have been reclassified to conform to the financial statement presentation adopted for 2016.

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