Province Of Nova Scotia 18-K Annual report (foreign governments)

Exhibit 99.2

Auditor General of Nova Scotia

1888 Brunswick Street, Suite 302	902 424 4046 tel
Halifax, Nova Scotia	902 424 4350 fax
B3J 3J8	www.oag-ns.ca
	pickupmz@gov.ns.ca

INDEPENDENT AUDITOR’S REPORT

To the Members of the Legislative Assembly of Nova Scotia:

Report on the Consolidated Financial Statements

I have audited the accompanying consolidated financial statements of the Province of Nova Scotia, which comprise the consolidated statement of financial position as at March 31, 2014, and the consolidated statements of operations and accumulated deficits, change in net debt and cash flow for the year then ended, and a summary of significant accounting policies and other explanatory information.

Government’s Responsibilities for the Consolidated Financial Statements

The Government of Nova Scotia is responsible for the preparation and fair representation of these consolidated financial statements in accordance with Canadian generally accepted accounting principles for the public sector and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

My responsibility is to express an opinion on these consolidated financial statements based on my audit. I conducted my audit in accordance with Canadian generally accepted auditing standards. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated 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 the accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Opinion

In my opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Province of Nova Scotia as at March 31, 2014, and its consolidated financial performance and cash flows for the year then ended in accordance with Canadian generally accepted accounting principles for the public sector.

Michael A. Pickup, CA

Auditor General of Nova Scotia

July 24, 2014

Halifax, Nova Scotia

69

Intentionally Left Blank

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Statement 1

Province of Nova Scotia

Consolidated Statement of Financial Position

As at March 31, 2014

($ thousands)

	2014			2013
				(as restated)
Financial Assets
Cash and Short-Term Investments (Note 3)		645,206			774,202
Accounts Receivable		769,169			846,737
Inventories for Resale		8,403			11,703
Loans Receivable (Schedule 3)		2,134,742			2,023,912
Investments (Note 3 & Schedule 3)		148,724			148,047
Investment in Government Business Enterprises (Schedule 6)		141,440			112,157
Assets Held for Sale (Note 4)		2,507			30,566
		3,850,191			3,947,324
Liabilities
Bank Advances and Short-Term Borrowings		539,565			550,440
Accounts Payable and Accrued Liabilities		2,030,107			1,796,086
Deferred Revenue (Note 5)		230,900			245,339
Accrued Interest		209,736			221,550
Unmatured Debt (Schedules 4 & 5)		12,991,397			12,869,245
Unamortized Foreign Exchange Translation Gains and Losses, Premiums and Discounts		149,928			178,000
Federal Equalization Repayable Loan (Note 6)		24,064			36,097
Pension, Retirement and Other Obligations (Note 7)		2,436,241			1,992,939
		18,611,938			17,889,696
Net Debt		(14,761,747	)		(13,942,372	)
Non-Financial Assets
Tangible Capital Assets (Schedule 7)		5,543,972			5,400,182
Inventories of Supplies		54,763			52,481
Prepaid Expenses		13,848			19,436
		5,612,583			5,472,099
Accumulated Deficits		(9,149,164	)		(8,470,273	)
Accounting Changes (Note 2)
Contingencies and Contractual Obligations (Note 12)
Trust Funds under Administration (Note 14)

The accompanying notes and schedules are an integral part of these Consolidated Financial Statements

71

Statement 2 Province of Nova Scotia Consolidated Statement of Operations and Accumulated Deficits For the fiscal year ended March 31, 2014 ($ thousands)

	Adjusted Estimate 2014		Actual 2014			Actual 2013
						(as restated)
Revenue (Schedule 1)
Provincial Sources
Tax Revenue		5,104,782		4,791,787			4,901,794
Other Provincial Revenue		1,274,276		1,297,906			1,390,634
Net Income from Government Business Enterprises (Schedule 6)		350,313		351,257			354,355
Investment Income		191,041		202,124			194,575
		6,920,412		6,643,074			6,841,358
Federal Sources		3,346,117		3,392,055			3,262,765
Total Revenue		10,266,529		10,035,129			10,104,123
Expenses (Schedule 2)
Agriculture		65,546		65,498			67,141
Communities, Culture and Heritage		61,668		59,750			59,363
Community Services		1,003,600		1,056,559			1,029,692
Economic and Rural Development and Tourism		176,190		188,998			212,132
Education and Early Childhood Development		1,401,881		1,442,134			1,422,771
Energy		27,682		31,513			30,393
Environment		73,661		72,189			72,569
Finance		47,260		50,165			88,808
Fisheries and Aquaculture		9,044		9,398			8,474
Health and Wellness		4,066,577		4,190,457			4,075,656
Justice		315,354		314,424			312,981
Labour and Advanced Education		403,342		424,402			388,901
Assistance to Universities		337,152		336,749			380,847
Natural Resources		91,316		86,724			100,995
Public Service		140,653		133,989			136,824
Seniors		1,859		1,813			1,748
Service Nova Scotia and Municipal Relations		251,637		266,288			270,102
Transportation and Infrastructure Renewal		426,837		457,911			417,747
Restructuring Costs		202,480		148,721			136,475
Restructuring of Nova Scotia Agricultural College (Note 8)		—		—			36,996
Pension Valuation Adjustment (Note 7)		110,793		388,160			108,510
Refundable Tax Credits		129,356		101,983			127,145
Debt Servicing Costs (Note 9)		906,252		886,195			921,484
Total Expenses (Note 10)		10,250,140		10,714,020			10,407,754
Provincial Surplus (Deficit)		16,389		(678,891	)		(303,631	)
Accumulated Deficits, Beginning of Year
As Previously Reported				(8,481,670	)		(8,179,179	)
Accounting Changes (Note 2)				11,397			12,537
As Restated				(8,470,273	)		(8,166,642	)
Accumulated Deficits, End of Year				(9,149,164	)		(8,470,273	)

The accompanying notes and schedules are an integral part of these Consolidated Financial Statements

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Statement 3

Province of Nova Scotia

Consolidated Statement of Changes in Net Debt

For the fiscal year ended March 31, 2014

($ thousands)

	Adjusted Estimate 2014			Actual 2014			Actual 2013
							(as restated)
Net Debt, Beginning of Year
As Previously Reported		(13,942,372	)		(13,953,769	)		(13,382,946	)
Accounting Changes (Note 2)		—			11,397			12,537
As Restated		(13,942,372	)		(13,942,372	)		(13,370,409	)
Changes in the Year *
Provincial Surplus (Deficit)		16,389			(678,891	)		(303,631	)
Acquisitions and Transfers of Tangible Capital Assets		(460,859	)		(545,850	)		(690,862	)
Amortization of Tangible Capital Assets		295,078			399,796			382,898
Disposals of Tangible Capital Assets		—			2,264			29,997
Decrease (Increase) in Inventories of Supplies		—			(2,282	)		4,558
Decrease in Prepaid Expenses		—			5,588			5,077
Total Changes in the Year		(149,392	)		(819,375	)		(571,963	)
Net Debt, End of Year		(14,091,764	)		(14,761,747	)		(13,942,372	)

* Except for the Provincial Surplus (Deficit) figure, the adjusted estimates for items under Changes in the Year reflect the activity of the General Revenue Fund only

The accompanying notes and schedules are an integral part of these Consolidated Financial Statements

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Statement 4 Province of Nova Scotia Consolidated Statement of Cash Flow For the fiscal year ended March 31, 2014 ($ thousands)

	2014			2013
				(as restated)
Cash Inflows (Outflows) from the following activities:
Operating
Provincial Deficit		(678,891	)		(303,631	)
Sinking Fund and Public Debt Management Fund Earnings		(111,470	)		(111,146	)
Amortization of Premiums and Discounts on Unmatured Debt		(2,595	)		(8,321	)
Amortization of Tangible Capital Assets		399,796			382,898
Net Income from Government Business Enterprises		(351,257	)		(354,355	)
Profit Distributions from Government Business Enterprises		321,974			343,646
Loss on Disposal of Tangible Capital Assets		(2,955	)		14,523
Net Change in Other Items (Note 11)		752,428			488,080
		327,030			451,694
Investing
Repayment of Loans		317,383			390,970
Advances and Investing		(439,843	)		(458,931	)
Write-offs		10,953			42,441
		(111,507	)		(25,520	)
Capital
Acquisition of Tangible Capital Assets		(545,850	)		(690,862	)
Proceeds from Disposal of Tangible Capital Assets		5,219			15,474
		(540,631	)		(675,388	)
Financing
Debentures Issued		964,771			1,359,519
Repayment of Federal Equalization Repayable Loan		(12,033	)		(12,032	)
Foreign Exchange Amortization		(17,172	)		(37,392	)
Sinking Fund Withdrawals (Installments)		274,551			(44,075	)
Repayment of Debentures and Other Long-Term Obligations		(1,014,005	)		(999,690	)
		196,112			266,330
Cash Inflows (Outflows)		(128,996	)		17,116
Cash Position, Beginning of Year		774,202			757,086
Cash Position, End of Year		645,206			774,202
Cash Position Represented by:
Cash and Short-Term Investments		645,206			774,202

The accompanying notes and schedules are an integral part of these Consolidated Financial Statements

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Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

1. Financial Reporting and Accounting Policies

The Province’s financial statements are prepared in accordance with Canadian generally accepted accounting principles (GAAP) for the public sector, which are represented by the Public Sector Accounting Standards (PSAS) of the Public Sector Accounting Board (PSAB) of the Chartered Professional Accountants of Canada (CPA Canada), supplemented where appropriate by other accounting standards of CPA Canada and the International Federation of Accountants.

The consolidated financial statements are prepared using the following significant accounting policies:

(a) Government Reporting Entity

The government reporting entity (GRE) is comprised of the General Revenue Fund, other governmental units (GUs), government business enterprises (GBEs), and the Province’s proportionate share of government partnership arrangements (GPAs). GUs and GBEs represent the entities that are controlled by the government. Control is defined as the power to govern the financial and operating policies of another organization with expected benefits or the risk of loss to the government from the other organization’s activities. Control exists regardless of whether the government chooses not to exercise its power to govern so long as it has the ability to govern. Control must exist at the financial statement date, without the need to amend legislation or agreements. GPAs represent entities for which decision making and significant risks and benefits are shared with other parties outside of the GRE.

Trusts administered by the Province are excluded from the GRE and are disclosed in Note 14 for information purposes only.

(b) Principles of Consolidation

A GBE is a self-sustaining organization that has the financial and operating authority to sell goods and services to individuals and non-government organizations as its principal activity and source of revenue. GBEs are accounted for on the modified equity basis. Their accounting principles are not adjusted to conform with those of the Province. The total net assets of all GBEs are included under Investment in GBEs on the Consolidated Statement of Financial Position. The total net income from all GBEs is reported as a separate item on the Consolidated Statement of Operations and Accumulated Deficits.

A GPA is a contractual arrangement between the government and a party or parties outside the GRE. The partners have significant clearly defined common goals, make a financial investment in the partnership, share control of decision making, and share, on an equitable basis, the significant risks and benefits associated with the operations of the government partnership. Where significant, the government’s interest in partnerships is accounted for using the proportionate consolidation method.

A GU is a government organization that is not a GBE or a GPA. GUs include government departments, public service units, funds, agencies, boards, commissions, government not-for-profit organizations, and service organizations. The accounts of GUs are consolidated on a line-by-line basis after adjusting the accounting policies to be consistent with those described in Note 1(d). Significant inter-organization accounts and transactions are eliminated.

A complete listing of the organizations within the GRE is provided in Schedule 10.

75

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

1. Financial Reporting and Accounting Policies (continued)

(c) Presentation of Estimates

Each year, the Province prepares an annual budget, referred to as the Estimates, which represents the financial plan of the Province presented by the government to the House of Assembly for the fiscal year commencing April 1. The Estimates, forming the basis of the Appropriations Act, are prepared primarily for the management and oversight of the General Revenue Fund based upon the government’s policies, programs, and priorities. Impacts of consolidation are summarized in the Estimates and included on a net basis as Consolidation and Accounting Adjustments.

For consolidation purposes, the Estimates were adjusted on a line-by-line basis to gross up the associated revenues and expenses of the consolidated entities in order to be comparative with these consolidated financial statements.

(d) Significant Accounting Policies

Revenues

Revenues are recorded on the accrual basis. The main components of revenue are various taxes, legislated levies, program recoveries, user fees, and investment income. Revenues from Personal and Corporate Income Taxes, as well as Harmonized Sales Tax and Petroleum Royalties, are accrued in the year earned based upon estimates using statistical models. Tax revenues are recorded at the amount estimated, after considering certain adjustments for non-refundable tax credits and other adjustments from the federal government. Refundable tax credits are not recognized as a reduction of tax revenues. Petroleum Royalties may be reduced by a portion of estimated abandonment costs for the future decommissioning or restoration of offshore field assets.

Government transfers are recognized as revenue in the period during which the transfer is authorized and all eligibility criteria are met, except when and to the extent that the transfer stipulations give rise to an obligation that meets the definition of a liability. Transfers meeting the definition of a liability are recorded as deferred revenue and are recognized as revenue when the funds are used as intended.

Expenses

Expenses are recorded on the accrual basis and are reported in more detail in Note 10, Expenses by Object. Grants and other government transfers are recognized as expenses in the period at the earlier of 1) the transfer being authorized and all eligibility criteria are met by the recipients and 2) time of the payment.

Provisions are made for probable losses on certain loans, investments, loan guarantees, accounts receivable, advances, forgivable loans, and for contingent liabilities when it is likely that a liability exists and the amount can be reasonably determined. These provisions are updated as estimates are revised, at least annually.

Financial Assets

Cash and Short-Term Investments are recorded at cost, which approximate market value. Investments are R-1 (low, mid, high) rated federal and provincial government bills or promissory notes, bankers’ acceptances, term deposits, and commercial paper. Terms of investments are generally 1 to 90 days. The average interest rate was 1.04 per cent at year-end.

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Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

1. Financial Reporting and Accounting Policies (continued)

Accounts Receivable and Advances are recorded at the principal amount less valuation allowances.

Inventories for Resale are held for sale in the ordinary course of operations and are recorded at the lower of cost and net realizable value.

Loans Receivable are recorded at cost less adjustments for concessionary assistance and any prolonged impairment in value. Concessionary assistance consists of subsidies provided by the Province and is recognized as an expense at the date of issuance of the loan. Any loan write-offs must be approved by the Governor-in-Council. Loans usually bear interest at approximate market rates and normally have fixed repayment schedules.

Investments are recorded at cost less adjustments for concessionary assistance and any prolonged impairment in value. Concessionary assistance consists of subsidies provided by the Province and is recognized as an expense at the date of issuance of the investment. Any write-down of an investment to reflect a loss in value is not reversed if there is a subsequent increase in value.

Liabilities

Bank Advances and Short-Term Borrowings have initial maturities of one year or less and are recorded at cost, which approximates market value. At year-end, short-term Canadian dollar borrowings had a weighted average interest rate of 0.97 per cent.

Unmatured Debt is comprised of debentures and various loans in Canadian and foreign currencies, as well as capital leases. Debt is recorded at par, net of sinking funds (including Public Debt Management Funds).

Hedge accounting is used when financial instruments form a hedging relationship, the relationship is highly effective, and it is considered to be consistent with the Province’s financial risk management goals. To have reasonable assurance of the effectiveness of a hedging relationship, the Province must expect the relationship to be effective in achieving offsetting changes in the fair value or cash flows of the hedged item and the hedging item. Effectiveness requires a high correlation of changes in fair values or cash flows. To ensure hedge effectiveness, the Province employs non-speculative derivatives that match the critical terms of the underlying hedged item.

Hedging relationships include synthetic instruments, which involve relationships between two or more assets or liabilities with matching terms for the purpose of emulating the net cash flows or other characteristics of a single asset or liability. Synthetic instrument accounting is used to account for the assets and liabilities in a synthetic instrument relationship as though they were the item being emulated.

Sinking Fund and Public Debt Management Fund investments are recorded at cost and consist primarily of debentures of the Province of Nova Scotia, other provincial governments, and the Government of Canada. Premiums and discounts on sinking funds are deferred and amortized over the life of the investment. Amortization and realized gains and losses for premiums and discounts relating to sinking fund balances and installments are netted against sinking fund earnings.

77

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

1. Financial Reporting and Accounting Policies (continued)

Unamortized Foreign Exchange Translation Gains and Losses result when debentures payable in foreign currencies, and sinking funds invested in foreign currencies are translated into Canadian dollars at the rate of exchange in effect at March 31 and upon entering into derivative contracts. Foreign exchange gains and losses on the translation of foreign currency are amortized on a straight-line basis over the remaining term of the related monetary item.

Premiums and Discounts, as well as underwriting commissions relating to the issuance of debentures, are deferred and amortized over the term of the related debt. Amortization and realized foreign exchange gains and losses, premiums and discounts relating to debt balances, serial retirements, sinking fund balances, and installments are charged to debt servicing costs except as noted above.

Pension, Retirement and Other Obligations include various employee future benefit plans, including accumulated sick leave benefits, where responsibility for the provision of benefits rests with the Province. Liabilities for these plans are calculated using the projected benefit actuarial method using accounting assumptions that reflect the Province’s best estimates of performance over the long-term. The projected benefit actuarial method attributes the estimated cost of benefits to the periods of employee service. The net liability represents accrued employee benefits less the market related value of plan assets (if applicable) and the balance of unamortized experience gains and losses. The market related values are determined in a rational and systematic manner so as to recognize asset market value gains and losses over a five-year period.

The Public Service Superannuation Plan (PSSP) is now subject to a joint governance framework with a new trustee that is arms-length to the Province and bears responsibility for the plan. The pension benefit plan for the majority of health sector employees is offered by a multi-employer plan administrator and is not sponsored by the Province. Employer contributions to these two plans are expensed in the period paid. The accrued benefit asset (liability) of these plans are not recognized in these financial statements.

Accumulated Sick Leave Benefits (ASLBs) arise from sick leave provisions in certain governmental units that accumulate but do not vest. Due to the nature of these benefits, a liability and an expense are measured using actuarial valuations taking into consideration the extent to which accumulated sick days are expected to be used by employees in future years. The accrued benefit obligation is accrued as employees render the service that gives rise to the benefits. These benefits are unfunded, meaning the Province has not set aside any assets to cover the future related costs.

Contingent liabilities, including provisions for losses on loan guarantees, are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense recorded. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements. In cases where an accrual is made, but exposure exists beyond the amount accrued, this excess exposure would also be disclosed, unless the impact is immaterial or the disclosure would have an adverse effect on the outcome of the contingency.

Net Debt

Net Debt represents the total liabilities of the Province less its financial assets. Net debt is the accumulation of current and past annual surpluses and deficits and net investments in non-financial assets.

78

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

1. Financial Reporting and Accounting Policies (continued)

Non-Financial Assets

Tangible Capital Assets have useful lives extending beyond the accounting period, are held for use in the production and supply of goods and services, and are not intended for sale in the ordinary course of operations. Tangible capital assets are recorded at gross historical cost (or estimated cost when the actual cost is unknown) and include all costs directly attributable to the acquisition, construction, development, and installation of the tangible capital asset, except interest. Tangible capital assets include land, buildings, major equipment and software, vehicles, ferries, roads, highways, and bridges.

Tangible capital assets do not include intangibles or assets acquired by right, such as forests, water and mineral resources, or works of art and historical treasures. Tangible capital assets are amortized to expense over the useful lives of the assets. The amortization methods and rates applied by the other governmental units are not adjusted to the methods and rates used by the General Revenue Fund.

Inventories of Supplies are held for consumption or use by the Province in the course of its operations and are recorded at the lower of cost and current replacement cost.

Prepaid Expenses are cash disbursements for goods or services, other than tangible capital assets and inventories of supplies, that will provide economic benefits in one or more future periods. The prepaid amount is recognized as an expense in the year the good or service is used or consumed.

Accumulated Deficits

Accumulated Deficits represent the total liabilities of the Province less financial assets and non-financial assets. This represents the cumulative balance of net surpluses and deficits arising from the operations of the Province.

(e) Measurement Uncertainty

Uncertainty in the determination of the amount at which an item is recorded in the financial statements is known as measurement uncertainty. Many items are measured using management’s best estimates based on assumptions that reflect the most probable set of economic conditions and planned courses of action. Uncertainty exists whenever estimates are used because it is reasonably possible that there could be a material difference between the recognized amount and another reasonably possible amount.

Measurement uncertainty exists in the accruals for such items as pension, retirement and other obligations, environmental remediation obligations, and federal and provincial source revenues. The nature of the uncertainty in the accruals for pension, retirement and other obligations arises because actual results may differ significantly from the Province’s various assumptions about plan members and economic conditions in the marketplace. Uncertainty exists in the accruals for environmental remediation obligations because the actual extent of the remediation activities, methods, and site contamination may differ significantly from the Province’s original remediation plans. Uncertainty related to Sales and Income Taxes, petroleum royalties, Canada Health Transfer, and Canada Social Transfer arises because of the possible differences between the estimated and actual economic growth and other assumptions used in statistical models to accrue these revenues.

79

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

1. Financial Reporting and Accounting Policies (continued)

(f) Future Changes in Accounting Policies

The Public Sector Accounting Board has issued a new accounting recommendation effective for fiscal years beginning on or after April 1, 2014. Section PS 3260 — Liability for Contaminated Sites establishes standards on how to account for and report a liability associated with the remediation of contaminated sites. Specifically, the section:

a) defines which activities would be included in a liability for remediation

b) establishes when to recognize and how to measure a liability for remediation

c) provides the related financial statement presentation and disclosure requirements.

The Province has analyzed this standard and does not expect any significant impacts on its financial statements in the year of adoption.

2. Accounting Changes

An accounting change was made during the year that has the following impact:

($ thousands)	2014				2013
	Net Debt April 1, 2013		Accumulated Deficits April 1, 2013		Provincial Deficit			Net Debt April 1, 2012		Accumulated Deficits April 1, 2012
Nova Scotia Teachers’
Pension Plan		11,397		11,397		(1,140	)		12,537		12,537

The gain realized upon transition of the Teachers’ Pension Plan (TPP) to joint trusteeship in 2006 should have been recognized immediately but was deferred and amortized over the expected average remaining service life (EARSL) of plan members. This was corrected retroactively this year, resulting in an increase of $1.1m to pension valuation adjustment expense and a decrease of $12.5 million to the opening accumulated deficits and net debt in 2013. The current year impact was an increase of $1.1 million to the pension valuation adjustment expense and a decrease of $11.4 million to the opening accumulated deficits.

3. Restricted Assets

As at March 31, 2014, assets of $57.0 million (2013 - $49.4 million) were designated for restricted purposes by parties external to the Province. Restricted cash and short-term investments totaled $6.3 million (2013 - $7.9 million), comprised of: $2.6 million (2013 - $2.4 million) for gas market development as part of the Nova Scotia Market Development Initiative Fund, $1.4 million (2013 - $3.2 million) for endowment and scholarship funds, and $2.3 million (2013 - $2.3 million) for various other purposes. Restricted investments totaled $50.7 million (2013 - $41.5 million), comprised of: $31.3 million (2013 - $26.7 million) for Capital District Health Authority’s (CDHA) Centre for Clinical Research, $9.5 million (2013 - $7.6 million) for other CDHA purposes, $7.4 million (2013 - $4.8 million) for endowment funds, and $2.5 million (2013 - $2.4 million) for various other purposes.

Externally restricted inflows not spent by year-end create a liability that will be settled by using the restricted assets for their intended purposes. The restricted assets described in this note are segregated from other assets and will be used as prescribed in a future period.

80

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

4. Assets Held for Sale

On December 10, 2012 (the “Acquisition Date”), the Province purchased 100% of the outstanding shares of Bowater Mersey Paper Company (Bowater), along with its wholly owned subsidiary, Brooklyn Power Corporation (BPC), for cash consideration of one dollar plus acquisition costs of $1.3 million. The Province gained control of the entity with the full intention to manage the orderly wind-up of Bowater’s operations. Effective December 11, 2012, Bowater’s name was changed to Renova Scotia Bioenergy Inc. (Renova).

The net assets acquired on the Acquisition Date included total assets of $149.5 million and total liabilities assumed of $148.2 million. Since the Acquisition Date, Renova has disposed of the majority of all assets held for sale under the agreements and plans in place at the Acquisition Date including the sale of BPC to a third party and the sale of physical assets to a third party.

At March 31, 2014, assets in the amount of $2.5 million were classified as held for sale. The wind-up of Renova is expected to be completed by August 31, 2014.

5. Deferred Revenue

Receipts are recorded as deferred revenue if they are restricted by external parties for a stated purpose, such as a specific program or the purchase of tangible capital assets. Deferred revenue is recognized into revenue over time as the recognition criteria are achieved or is drawn down to reimburse third parties as conditions are met. The balance includes the following components:

($ thousands)	2014		2013
Housing Nova Scotia - Social Housing Agreement		64,850		61,769
Capital District Health Authority - Capital and Research Funds		41,196		34,460
Provincial-Territorial Base Funding Agreement - Infrastructure and Highways		36,200		39,777
Izaak Walton Killam Health Centre - Capital and Research Funds		23,567		20,204
Resource Recovery Fund Board Inc. - Unearned Revenue from Container Deposits, Paint Levies and Tire Deposits		14,304		14,167
Nova Scotia Community College		12,410		10,271
Seniors Pharmacare		6,496		6,069
Waterfront Development Corporation Limited		4,070		3,996
Halifax Regional School Board		3,644		3,460
Nova Scotia School Insurance Program		3,503		1,633
Nova Scotia Market Development Initiative Fund		2,738		3,771
Trade Centre Limited		2,659		3,293
Cape Breton District Health Authority		1,917		5,691
Annapolis Valley Regional School Board		1,765		1,431
Labour Market Agreement		1,478		3,927
Public Archives of Nova Scotia		1,390		1,347
Heritage Canada - Official Languages in Education Protocol (OLEP)		317		4,755
South Shore District Health Authority - Capital Funds		227		3,318
Early Learning Child Care Funds		—		7,161
C-50 Police Officers Recruitment Fund		—		3,500
Nova Scotia Gas Tax Agreement on Municipal Funding		—		1,400
Other Externally Restricted Funds		8,169		9,939
Total Deferred Revenue		230,900		245,339

81

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

6. Federal Equalization Repayable Loan

The Province received an equalization repayable loan from the federal government in March 2005 in the amount of $120.3 million. The loan bears no interest and is being repaid over 10 years, with bi-monthly deductions of $0.5 million that commenced in April 2006. As at March 31, 2014, the balance of the loan was $24.1 million (2013 – $36.1 million).

7. Pension, Retirement and Other Obligations

The Province offers a variety of pension and other retirement, post-employment, and special termination benefits. The Province is responsible for adequately funding most of the plans. Except as otherwise noted, the cost of benefits are recognized in the periods the employee provides service. For benefits that do not vest or accumulate, a liability is recognized when an event that obligates the Province to pay benefits occurs.

(a) Description of Obligations

Pension Benefit Plans

The Province participates in two funded pension plans, the Nova Scotia Public Service Superannuation Plan (PSSP) and the Nova Scotia Teachers’ Pension Plan (TPP). Both plans are defined benefit plans with plan assets primarily composed of Canadian and foreign equities, government and corporate bonds, debentures, secured mortgages and real estate. The plans are jointly funded with contributions from employees being matched by the Province. Benefits paid upon retirement are based on an employee’s length of service, rate of pay, and inflation adjustments.

On April 1, 2013, the PSSP transitioned to a joint governance structure where the Minister of Finance transferred responsibility for the PSSP to the Public Service Superannuation Plan Trustee Inc. (PSSPTI), the new trustee of the PSSP. PSSPTI is a body corporate comprised of 13 board members – six representing the Province as the employer and six representing the employees with an independent chairperson. This detailed joint governance framework included in the Financial Measures (2010) Act was implemented by way of the Financial Measures (2012) Act.

Due to the plan amendments, the Province has no residual liability for the PSSP and therefore no longer carries an asset or liability associated with the PSSP on its Statement of Financial Position. This resulted in an immediate recognition of the PSSP’s $318.3 million accrued benefit asset, which has been recorded as a pension valuation adjustment expense in 2014. There was no impact on prior years. The Province’s pension expense for the PSSP is now limited to contributions paid to the PSSP as an employer, which are equal to the employee contributions. The contribution rate is set by PSSPTI pursuant to the funding policy and is set for a five year cycle. Beginning in 2015, PSSPTI will review the funded health of the plan and implement any required changes as prescribed by the funding policy. The Province’s employer contributions to the PSSP in 2014 were $81.7 million.

82

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

7. Pension, Retirement and Other Obligations (continued)

On April 1, 2006, the Minister of Finance transferred responsibility for the governance of the Nova Scotia Teachers’ Pension Plan to the Teachers’ Pension Plan Trustee Inc. (TPPTI). The TPPTI is the trustee for the plan and is comprised of nine board members – four nominated by the Nova Scotia Teachers’ Union, four nominated by the Province, and one Chair agreed to by both parties. As a result of this transfer, the Province and Union agreed to share all surpluses and deficits of the plan equally. The Province accounts for half of all components of the accrued benefit liability associated with the plan in its financial statements. In addition, the Province recognizes half of components associated with the net benefit expense (recovery) associated with this plan. As at March 31, 2014, the total accrued benefit liability associated with this plan was $436.3 million.

The Province has several unfunded defined pension plans. The majority of these plans do not require contributions from employees. Benefits paid upon retirement are based on an employee’s length of service, rate of pay, and inflation adjustments.

Employees in the health sector are members of a multi-employer defined benefit pension plan. As the Province does not sponsor this plan, the annual net benefit plan expense is the amount of required contributions provided for employees’ services rendered during the year. The accrued benefit asset (liability) of this plan is not recognized in these financial statements. The most recent actuarial valuation was performed on April 1, 2012 and extrapolated to December 31, 2013, which indicated a funding surplus of $721.7 million. The Province’s employer contributions to this plan in 2014 were $99.3 million (2013 - $92.3 million).

Other Retirement Benefit Plans

The Province sponsors two other retirement benefit plans: retirement allowances and retirement health plan benefits. These plans are not funded. Benefits paid upon retirement for retirement allowances are based on an employee’s length of service and rate of pay. Retirement health plan benefits vary depending on the collective agreements negotiated with each group. The Province pays 65 per cent and 100 per cent of the cost of retirement health plan benefits for the PSSP and TPP retirees, respectively.

Post-Employment Benefits

The Province offers two significant post-employment benefit plans: Self Insured Workers’ Compensation and Long-Term Disability. The amount recorded in these financial statements represents the actual amount of benefits paid during the year plus the actuarial estimate of future payments, based on claims ongoing at year-end. For the Long-Term Disability plan, the obligation is offset by the market related value of plan assets.

Accumulated Sick Leave Provisions

The Province’s Regional School Boards, District Health Authorities, and Nova Scotia Community College have collective agreements containing sick leave provisions that accumulate but do not vest. Under Public Sector Accounting Standards, governments must measure and record an obligation associated with the accumulated sick leave benefits (ASLBs) that are anticipated to be used in future years. Within the Province, ASLBs are unfunded, meaning there are no assets set aside to cover the related costs of these benefits in the future.

83

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

7. Pension, Retirement and Other Obligations (continued)

Due to the nature of these benefits, actuarial valuations are required to estimate their financial value. An actuarial assumption must be developed to reflect the probability of employees actually using ASLB “banked days”. This involves a detailed analysis of several years of data to determine historical usage. A historical usage pattern is not based on the data group as a whole but must take into account a number of specific factors such as, but not limited to, gender, age, and type of contract/job responsibilities, each of which may impact the anticipated amount of accumulated sick leave time to be taken in the future. As a result, the anticipated usage assumption may involve a number of criteria and circumstances that then must be applied to the data in coordination with other actuarial assumptions such as discount rate, retirement assumptions, future salary increases, mortality tables, etc.

The recording of liabilities for ASLBs in 2014 is based on actuarial valuations that were completed in 2012 and 2013 and extrapolated to March 31, 2014.

Special Termination Benefits

The Province has offered early retirement incentive programs to members of the PSSP and TPP at various times commencing in 1986 and 1994 respectively. Qualified members were offered additional years of pensionable service if they elected to retire. The cost of these benefits was accrued in the year the employee accepted the early retirement option.

Retirement Obligations of Renova Scotia Bioenergy Inc.

As part of the Province’s acquisition of Renova, described in Note 4, there were unfunded pension liabilities associated with various pension plans and retirement health benefits. The obligations and assets associated with these plans were noted as “acquisitions” in 2013 in the continuity statements in Note 7(b). The net unfunded liabilities of these plans totaled $112.0 million as at December 10, 2012. Land and other assets were subsequently sold, and the proceeds were used to fund the liabilities. As at March 31, 2014, the net unfunded liabilities associated with these plans were $19.3 million and are included in these financial statements.

84

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

7. Pension, Retirement and Other Obligations (continued)

(b) Summary of Activity During the Year

($ thousands)	Pension Benefits 2014			Other Benefits 2014			Total 2014			Total 2013
										(as restated)
Projected Benefit Obligation, Beginning of Year		8,567,836			1,864,155			10,431,991			9,726,972
Current Benefit Cost		65,555			108,455			174,010			325,829
Interest Cost		212,692			77,459			290,151			609,947
Actuarial (Gains) Losses		48,784			83,035			131,819			32,733
Benefit Payments		(233,132	)		(106,948	)		(340,080	)		(597,283	)
Other		552			(1,274	)		(722	)		7,385
Acquisitions		—			—			—			317,800
Plan Amendments		(5,015,314	)		—			(5,015,314	)		8,608
Projected Benefit Obligation, End of Year		3,646,973			2,024,882			5,671,855			10,431,991
Market Related Value of Plan Assets, Beginning of Year		7,124,041			131,773			7,255,814			6,864,968
Expected Return on Plan Assets		146,839			4,603			151,442			445,968
Actuarial Gains (Losses)		82,684			440			83,124			(154,125	)
Benefit Payments		(233,132	)		(106,948	)		(340,080	)		(597,283	)
Other		1,120			(700	)		420			8,042
Plan Amendments		(4,584,312	)		—			(4,584,312	)		—
Acquisitions		—			—			—			205,800
Employer Contributions		70,158			100,528			170,686			346,687
Employee Contributions		39,166			6,608			45,774			135,757
Market Related Value of Plan Assets, End of Year		2,646,564			136,304			2,782,868			7,255,814
Funded Status, End of Year		(1,000,409	)		(1,888,578	)		(2,888,987	)		(3,176,177	)
Unamortized Net Actuarial (Gains) Losses		418,952			96,179			515,131			1,239,713
Valuation Allowance		—			(62,385	)		(62,385	)		(56,475	)
Accrued Benefit Liability, End of Year		(581,457	)		(1,854,784	)		(2,436,241	)		(1,992,939	)

85

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

7. Pension, Retirement and Other Obligations (continued)

(c) Actuarial Assumptions

The table below shows significant weighted-average assumptions used to measure pension and other benefit plan obligations.

	Pension Benefits						Other Benefits
	2014			2013			2014			2013
Long-term inflation rates		2.25	%		2.25	%		2.25	%		2.25	%
Expected real rate of return on plan assets:
PSSP		—			4.15	%
TPP		4.50	%		4.40	%
Long-Term Disability Plan								1.22	%		3.25	%
Rate of compensation increase		2.00% to 3.00% + merit			2.50% to 5.25% + merit			2.00% to 3.00% + merit			2.40% to 4.90% + merit
Discount rates:
PSSP		—			6.50	%
TPP		6.85	%		6.75	%
Long-Term Disability Plan								3.50	%		5.57	%
Other Plans								4.10	%		4.30	%

Other assumptions

7.0 per cent annual rate increase in the cost per person of covered healthcare benefits for 2013-14, decreasing to an ultimate rate of 4.5 per cent per annum over 15 years.

7.0 per cent annual rate increase in the cost per person of covered prescription drugs for 2013-14, decreasing to an ultimate rate of 4.5 per cent per annum over 15 years.

Actuarial assumptions are reviewed and assessed on a regular basis to ensure that the accounting assumptions take into account various changing conditions and reflect the Province’s best estimate of performance over the long-term.

(d) Other Disclosure

The net unamortized actuarial gains (losses) are amortized on a straight-line basis over the expected average remaining service life (EARSL) of the related employee groups ranging from 5 years to 18 years (weighted-average EARSL is 15 years).

During the year, the weighted average actual rate of return on plan assets was 12.4 per cent (2013 – 10.1 per cent). The total market value of plan assets at March 31, 2014 was $4.8 billion (2013 - $9.2 billion).

The most recent actuarial valuations performed for most of the benefit plans was at December 31, 2012 with the exception of certain other retirement benefit plans that were performed on various dates and the post-employment benefit plans that are performed annually at March 31.

86

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

7. Pension, Retirement and Other Obligations (continued)

(e) Net Benefit Plans Expense

The table below shows the components of the net benefit plans expense (recovery).

($ thousands)	2014									2013
	Pension Benefits			Other Benefits			Total			Total
										(as restated)
Current Benefit Cost		65,555			108,455			174,010			325,829
Employee Contributions		(39,663	)		(6,632	)		(46,295	)		(136,277	)
Employer Contributions *		36,998			—			36,998			39,706
Plan Amendments		318,261			—			318,261			8,608
Amortization of Net Actuarial (Gains) Losses		22,027			896			22,923			88,352
Recognition of Actuarial Losses on Plan Amendment		—			—			—			(425	)
Other		(320	)		679			359			556
Increase (Decrease) in Valuation Allowance		—			5,910			5,910			7,120
Interest Cost		212,692			77,459			290,151			609,947
Expected Return on Plan Assets		(146,839	)		(4,603	)		(151,442	)		(445,968	)
Employer Contributions to Multi-Employer Plan		180,938			—			180,938			92,295
Net Benefit Plans Expense		649,649			182,164			831,813			589,743
Recorded as:
Fringe Benefits Expense		239,348			65,596			304,944			317,254
Pension Valuation Adjustment		344,448			43,712			388,160			108,510
Net Pension Interest Cost		65,853			72,856			138,709			163,979
Net Benefit Plans Expense		649,649			182,164			831,813			589,743

* This represents one-half of the employer contributions made by the Province to the TPP. Included in the figures above are one-half of all transactions associated with TPP to reflect the Province’s share of this plan under joint trusteeship.

8. Restructuring of Nova Scotia Agricultural College

On September 1, 2012, the Nova Scotia Agricultural College (NSAC) was merged with Dalhousie University (Dalhousie) in accordance with the Dalhousie University – Nova Scotia Agricultural College Merger Act. The NSAC campus land, buildings, and other operating assets were transferred to Dalhousie as at the date of the merger. Therefore, NSAC no longer forms part of the Province’s Government Reporting Entity effective September 1, 2012. The merger included a three year funding agreement between the Province and Dalhousie. The funding for NSAC in 2014 was included in Agriculture expenses.

87

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

8. Restructuring of Nova Scotia Agricultural College (continued)

Expenses related to the transfer of NSAC charged to Restructuring Costs in 2013 were as follows:

($ thousands)	2014		2013
Net Book Value of Assets Transferred to Dalhousie		—		29,218
Other Transition Costs		—		7,778
Restructuring of Nova Scotia Agricultural College		—		36,996

9. Debt Servicing Costs

($ thousands)	2014			2013
CDN$ Denominated Debt		748,230			770,787
Pension, Retirement and Other Obligations		138,709			163,979
Capital Leases		14,743			16,052
Other Debt		7,248			8,503
Premium / Discount Amortization		(2,734	)		(8,321	)
Foreign Exchange		(21,010	)		(30,679	)
Miscellaneous		1,009			1,163
Total Debt Servicing Costs		886,195			921,484

Debt servicing costs for the Province’s government business enterprises were $12.3 million (2013—$13.4 million) for the year ended March 31, 2014.

10. Expenses by Object

($ thousands)	2014		2013
			(as restated)
Grants and Subsidies		3,588,447		3,712,408
Salaries and Employee Benefits		3,974,493		3,550,010
Operating Goods and Services		1,572,600		1,478,327
Professional Services		288,880		330,223
Amortization		399,796		382,898
Debt Servicing Costs		886,195		921,484
Other		3,609		32,404
Total Expenses by Object		10,714,020		10,407,754

88

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

11. Cash Flow — Net Change in Other Items

($ thousands)	2014			2013
				(as restated)
Change in Receivables from Government Business Enterprises		(37,161	)		9,642
Change in Accounts Receivable		114,729			116,955
Change in Accounts Payable and Other Short-Term Borrowings		223,146			189,186
Change in Inventories for Resale		3,300			(2,733	)
Change in Assets Held for Sale		28,059			(30,566	)
Change in Inventories of Supplies		(2,282	)		4,558
Change in Prepaid Expenses		5,588			5,077
Change in Deferred Revenue		(14,439	)		(33,528	)
Change in Accrued Interest		(11,814	)		4,959
Change in Pension, Retirement and Other Obligations		443,302			224,530
Total Net Change in Other Items		752,428			488,080

12. Contingencies and Contractual Obligations

(a) Contingent Liabilities

Environmental Sites

Various provincially owned sites throughout the province are considered environmental or contaminated sites. Studies are ongoing to assess the nature and extent of damage to develop remediation plans. Provisions for these costs are recorded when it is determined a liability exists and a reasonable estimate of the remediation costs can be made. With the exception of the remediation costs noted in the following paragraphs, no further provisions have been recognized in these financial statements.

Engineering and environmental studies have generated estimates for the cost of remediation of the Sydney Steel Corporation (SYSCO) and adjacent sites as well as the Sydney Tar Ponds site. As a result, the Province recorded liabilities totaling $318.5 million in 2000 for environmental site clean-up. At March 31, 2014, $75.6 million (2013 - $65.2 million) remains unspent. The provision will continue to be utilized for future decommissioning, demolition, and remediation of SYSCO’s and adjacent sites, including the Sydney Tar Ponds site. Based on currently available information, the provision, in aggregate, appears to be sufficient to cover the estimated costs to remediate these sites.

Other remediation liabilities amounting to $31.6 million (2013 – $16.0 million) have been recognized in these financial statements.

Lawsuits

The Province of Nova Scotia is involved in various legal proceedings arising from government activities. These different disputes result from breaches of contract, damages suffered by individuals or property, and related elements. These claims include items with pleading amounts and items where an amount is not specified. While the total amount claimed in these actions may be significant, their outcomes are not certain.

When a liability is determined to likely exist and the amount can be reasonably estimated, the amount is recorded as an accrued liability and an expense. The accrued liability for pending litigation in process at March 31, 2014 was $48.7 million (2013 – $52.0 million).

89

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

12. Contingencies and Contractual Obligations (continued)

Guarantees

Guarantees by the Province are authorized by various acts of legislature and provided through specific agreements and programs to repay promissory notes, bank loans, lines of credit, mortgages, and other securities. Provisions for losses on guarantees are recorded when it is likely that a loss will occur. The amount of the loss provisions represents the Province’s best estimate of future payments. Estimates take into consideration the nature of the loan guarantees, loss experience, and current conditions. The provisions are reviewed on an ongoing basis and changes in the provisions are recorded as expenses in the year they become known. Details on guarantees authorized, utilized, and accrued are presented in Schedule 8.

Other Contingent Liabilities

The Province also has contingent liabilities in the form of indemnities. The Province’s potential liability, if any, cannot be determined at this time.

(b) Contingent Gains

The Province may receive funds in the future from recoveries of various types of claims paid out and other agreements pending the occurrence of certain events. Recoveries are recorded once the contingent events occur and collectability is reasonably assured.

(c) Contractual Obligations

As at March 31, 2014, the Province has contractual obligations as follows:

($ thousands)	Governmental Units		Government Business Enterprises		Total Contractual Obligations
Fiscal Year
2015		987,219		20,483		1,007,702
2016		568,472		14,271		582,743
2017		516,591		13,456		530,047
2018		493,035		5,001		498,036
2019		476,059		869		476,928
2020-2024		1,675,636		—		1,675,636
2025-2029		1,744,074		—		1,744,074
2030-2034		1,560,472		—		1,560,472
2035 & thereafter		454,799		—		454,799
		8,476,357		54,080		8,530,437

These contractual obligations are comprised of $8,336.7 million from the General Revenue Fund, $139.6 million from the Province’s governmental units, and $54.1 million from government business enterprises. Included are contractual obligations from the Department of Health and Wellness of $4,047.8 million for service agreements with long-term care facilities and $581.8 million for the management of the ground ambulance fleet, $2,566.2 million from the Department of Justice for RCMP policing services, $317.0 million from the Department of Labour and Advanced Education for university assistance, $184.6 million from the Department of Education and Early Childhood Development for P3 School maintenance agreements, and $77.7 million from Nova Scotia Business Inc. for projects approved under its various programs.

90

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

12. Contingencies and Contractual Obligations (continued)

LEASES

As at March 31, 2014, the Province was contractually obligated under various operating leases. Future minimum annual lease payments are as follows:

($ thousands)	Governmental Units		Government Business Enterprises		Total Lease Payments
Fiscal Year
2015		72,558		6,923		79,481
2016		57,945		5,191		63,136
2017		51,654		3,897		55,551
2018		35,362		3,473		38,835
2019		27,305		3,194		30,499
2020-2024		32,035		8,390		40,425
2025-2029		2,796		—		2,796
2030-2034		1,105		—		1,105
		280,760		31,068		311,828

13. Risk Management and the Use of Derivative Financial Instruments

As a result of borrowing in both Canadian and foreign financial markets and being a party to financial instruments, the Province is exposed to interest rate risk, foreign exchange risk, credit risk, and liquidity risk. The Province employs various risk management strategies and operates within fixed risk exposure limits to ensure exposure to risk is managed in a prudent and cost effective manner. A variety of strategies are used, including the use of derivative financial instruments (derivatives). Derivatives are financial contracts, the value of which is derived from underlying instruments. The Province uses derivatives to hedge and to mitigate foreign exchange risk and interest rate risk. The Province does not use derivatives for speculative purposes.

Interest rate risk

Interest rate risk is the risk that debt servicing costs will vary unfavourably due to fluctuations in interest rates. To reduce its exposure to interest rate risk, the Province uses derivatives to manage the fixed and floating interest rate mix of its debt portfolio. Interest rate contracts include swap agreements and options on swaps. These contracts are used to vary the amounts and periods for which interest rates on borrowings are fixed or floating.

As at March 31, 2014, the Province has executed 35 interest rate swap contracts to convert certain interest payments from fixed to floating, floating to fixed, and floating to floating. These swaps have terms remaining of 101 days to 14.6 years, a notional principal value of $1.4 billion, and a mark to market value of -$1.9 million.

Foreign exchange risk

Foreign exchange risk is the risk that the cash flows needed to repay the interest and principal on loans in foreign currencies will vary due to fluctuations in foreign exchange rates. To manage this risk, the Province uses derivative contracts to convert foreign currency principal and interest cash flows into Canadian dollar denominated cash flows. Derivative contracts hedge the underlying debt by matching the critical terms to achieve effectiveness. Foreign exchange contracts include swap agreements that are used to convert the liability for foreign currency borrowing and associated costs into Canadian dollars.

91

Province of Nova Scotia Notes to the Consolidated Financial Statements As at March 31, 2014

13. Risk Management and the Use of Derivative Financial Instruments (continued)

The Province has currency swap contracts which convert foreign denominated debt into Canadian dollar denominated debt as follows:

Termination Date	Original Currency		Original Principal		Current Currency	Current Principal		Mark to Market1
			($     thousands)			($     thousands)		($     thousands)
April 16, 2019		UK£		60,000	CDN$		114,387		(4,729	)
Total		UK£		60,000	CDN$		114,387		(4,729	)
July 21, 2015		US$		750,000	CDN$		771,750		74,050
March 15, 2016		US$		150,000	CDN$		205,725		(29,629	)
January 26, 2017		US$		500,000	CDN$		562,470		39,268
February 1, 2019		US$		200,000	CDN$		198,000		29,940
July 1, 2019		US$		200,000	CDN$		199,900		24,474
November 15, 2019		US$		244,000	CDN$		246,318		28,348
March 1, 2020		US$		300,000	CDN$		409,200		(82,196	)
May 1, 2021		US$		300,000	CDN$		312,002		26,016
April 1, 2022		US$		300,000	CDN$		379,517		(46,422	)
July 30, 2022		US$		300,000	CDN$		329,310		3,657
Total		US$		3,244,000	CDN$		3,614,192		67,506

¹  Mark to Market is an indication of the swap’s market value as at March 31, 2014. It is also the equivalent of the present value of future cash flows based on market conditions at March 31, 2014.

Credit risk

Credit risk is the risk that a counterparty will default on its contractual obligations. The Province manages its credit risk exposure from derivatives by, among other activities, dealing only with high credit quality counterparties and regularly monitoring compliance to credit limits. The Province’s policy requires that a minimum credit rating for counterparties to derivative transactions be ‘A’, where the minimum rating in the “A” category is “A-“or equivalent.

Liquidity risk

Liquidity risk is the risk that the Province will not be able to meet its financial commitments over the short term. To reduce liquidity risk, the Province maintains liquid reserves (cash and cash equivalents) at levels that will meet future cash requirements and will give the Province flexibility in the timing of issuing debt. In addition, the Province has a short-term note program, uncommitted bank lines, and discretionary sinking funds as alternative sources of liquidity. This risk is also managed by distributing debt maturities over many years and having 50.0 per cent of long-term debt with a maturity of over 15 years.

92

Province of Nova Scotia

Notes to the Consolidated Financial Statements

As at March 31, 2014

14. Trust Funds Under Administration

Trust fund assets solely administered by the Province are as follows:

($ thousands)	2014			2013
				(as restated)
Nova Scotia Public Service Superannuation Fund		—			4,709,136
Sydney Steel Corporation Superannuation Plan(1) (2)		(6	)		8
Nova Scotia Public Service Long Term Disability Plan(1) (3)		136,954			127,804
Nova Scotia Credit Union Deposit Insurance Corporation(3)		23,057			20,584
Public Trustee(1)		52,508			51,913
Miscellaneous Trusts(4)		9,416			19,226
Total Trust Funds Under Administration		221,929			4,928,671

(1) Financial statements of these funds are available in Public Accounts, Volume 2.

(2) Administration of the assets of Sydney Steel Corporation Superannuation Fund was assumed during 2001.

(3) These represent trusts with December 31 year-ends.

(4) Miscellaneous trusts include a large number of relatively small funds.

Other

The Nova Scotia Teachers’ Union and the Province of Nova Scotia agreed to joint trusteeship of the Nova Scotia Teachers’ Pension Fund effective April 1, 2006. Under joint trusteeship, the Trustee of the Fund is the Nova Scotia Teachers’ Pension Plan Trustee Inc., of which the Province has four of nine members. The Trustee is responsible for the administration of the Fund and investment management of fund assets. Total net assets available for benefits as at December 31, 2013 were $4.6 billion (2012 – $4.2 billion).

Effective April 1, 2013, the Minister of Finance transferred responsibility of the Public Service Superannuation Plan to a new trustee, Public Service Superannuation Plan Trustee Inc. As a result of this transfer, the Province no longer has any responsibility for this plan. Total net assets available for benefits as at March 31, 2014 were $5.1 billion (2013 – $4.7 billion).

15. Related Party Transactions

Included in these consolidated financial statements are insignificant transactions with various provincial crown corporations, agencies, boards, and commissions. Significant related party transactions have been offset and eliminated for purposes of consolidated reporting. Parties are deemed to be related to the General Revenue Fund due to common control or ownership by the Province of Nova Scotia.

The most significant unadjusted related party transactions are described in more detail in Schedule 6 – Government Business Enterprises.

16. Comparative Figures

Certain of the prior year’s figures have been reclassified to conform to the presentation format adopted in the current year.

93

Schedule 1 Revenue For the fiscal year ended March 31, 2014 ($ thousands)

	2014			2013
Provincial Sources
Tax Revenue
Personal Income Tax		2,130,543			2,128,498
Corporate Income Tax		407,971			434,078
Harmonized Sales Tax		1,620,772			1,729,344
Tobacco Tax		217,229			206,287
Motive Fuel Tax		246,800			243,446
Other Tax Revenue		168,472			160,141
		4,791,787			4,901,794
Other Provincial Revenue
Recoveries		368,373			377,443
Other Revenue from Governmental Units		467,268			461,193
Municipal Contributions to School Boards		240,435			220,902
Petroleum Royalties		(124,819	)		3,535
Registry of Motor Vehicles		120,506			113,434
Other Government Charges		59,996			68,679
Miscellaneous		161,686			130,138
Net Gain on Disposal of Crown Assets		4,461			15,310
		1,297,906			1,390,634
Net Income from Government Business Enterprises		351,257			354,355
Investment Income
Interest Revenue		90,654			83,429
Sinking Fund and Public Debt Management Fund Earnings		111,470			111,146
		202,124			194,575
Total Provincial Sources		6,643,074			6,841,358
Federal Sources
Equalization Payments		1,718,183			1,578,829
Canada Health Transfer		833,130			793,237
Canada Social Transfer		327,322			323,897
Recoveries		262,065			247,434
Offshore Accord		89,461			146,059
TCA Cost Shared Revenue		22,485			24,470
Crown Share		4,577			12,916
Other Federal Transfers		134,832			135,923
Total Federal Sources		3,392,055			3,262,765
Total Revenue		10,035,129			10,104,123

94

Schedule 2

Expenses

For the fiscal year ended March 31, 2014

($ thousands)

	2014		2013
			(as restated)
Agriculture
Department of Agriculture		56,634		57,683
Nova Scotia Blueberry Institute Fund		—		34
Nova Scotia Crop and Livestock Insurance Commission		3,502		2,251
Nova Scotia Harness Racing Fund		1,001		1,000
Perennia Food and Agriculture Incorporated		4,361		6,173
		65,498		67,141
Communities, Culture and Heritage
Department of Communities, Culture and Heritage		53,485		52,182
Art Gallery of Nova Scotia		3,371		4,039
Public Archives of Nova Scotia		111		83
Schooner Bluenose Foundation		21		622
Sherbrooke Restoration Commission		2,762		2,415
Vive l’Acadie Community Fund		—		22
		59,750		59,363
Community Services
Department of Community Services		909,297		880,246
Housing Nova Scotia		147,262		149,446
		1,056,559		1,029,692
Economic and Rural Development and Tourism
Department of Economic and Rural Development and Tourism		119,938		157,036
Bioscience Enterprise Centre Incorporated		33
Film and Creative Industries Nova Scotia		6,151		4,796
Nova Scotia Business Inc.		29,842		18,132
Nova Scotia Innovation Corporation		10,397		10,687
Nova Scotia Strategic Opportunities Fund Incorporated		10		4
Renova Scotia Bioenergy Inc.		2,364		—
Trade Centre Limited		15,990		15,317
Waterfront Development Corporation Limited		4,303		6,157
		188,998		212,132
Education and Early Childhood Development
Department of Education and Early Childhood Development		246,030		249,965
Annapolis Valley Regional School Board		129,423		127,374
Cape Breton Victoria Regional School Board		146,786		148,904
Chignecto-Central Regional School Board		194,039		190,799
Conseil scolaire acadien provincial		60,388		56,552
Halifax Regional School Board		439,395		426,174
Nova Scotia School Boards Association		595		617
Nova Scotia School Insurance Program		5,176		4,137
South Shore Regional School Board		73,615		73,173
Strait Regional School Board		80,155		78,972
Tri-County Regional School Board		66,532		66,104
		1,442,134		1,422,771

95

Schedule 2 Expenses (continued) For the fiscal year ended March 31, 2014 ($ thousands)

	2014		2013
			(as restated)
Energy
Department of Energy		30,311		29,209
Nova Scotia Market Development Initiative Fund		1,033		1,113
Pengrowth Nova Scotia Energy Scholarship Fund		169		71
		31,513		30,393
Environment
Department of Environment		24,562		24,703
Resource Recovery Fund Board Inc.		47,627		47,866
		72,189		72,569
Finance
Department of Finance		40,108		37,639
Nova Scotia Pension Agency		—		41,237
Nova Scotia Utility and Review Board		9,409		9,917
3052155 Nova Scotia Limited		648		15
		50,165		88,808
Fisheries and Aquaculture
Department of Fisheries and Aquaculture		9,015		8,474
Nova Scotia Sportfish Habitat Fund		383		—
		9,398		8,474
Health and Wellness
Department of Health and Wellness		1,921,405		1,916,813
Annapolis Valley District Health Authority		136,207		129,969
Cape Breton District Health Authority		311,654		298,403
Capital District Health Authority		944,400		883,949
Colchester East Hants Health Authority		91,452		81,092
Cumberland Health Authority		64,802		66,749
Gambling Awareness Foundation of Nova Scotia		703		432
Guysborough Antigonish Strait Health Authority		87,687		84,382
Izaak Walton Killam Health Centre		251,465		247,970
Nova Scotia Health Research Foundation		5,126		5,442
Pictou County Health Authority		85,627		80,580
Provincial Drug Distribution Program		94,330		90,253
South Shore District Health Authority		91,626		89,355
South West Nova District Health Authority		103,973		100,267
		4,190,457		4,075,656
Justice
Department of Justice		286,649		285,320
Law Reform Commission		297		301
Nova Scotia E911 Cost Recovery Fund		4,648		4,809
Nova Scotia Legal Aid Commission		22,830		22,551
		314,424		312,981

96

Schedule 2

Expenses (continued)

For the fiscal year ended March 31, 2014

($ thousands)

	2014		2013
			(as restated)
Labour and Advanced Education
Department of Labour and Advanced Education		212,461		188,329
Nova Scotia Community College		211,941		200,572
		424,402		388,901
Assistance to Universities		336,749		380,847
Natural Resources
Department of Natural Resources		84,711		98,978
Coal Research Agreement Fund		300		—
Crown Land Mine Remediation Fund		54		—
Habitat Conservation Fund		130		160
Nova Scotia Primary Forest Products Marketing Board		136		112
Off-Highway Vehicle Infrastructure Fund		1,320		1,745
Species-at-risk Conservation Fund		73		—
		86,724		100,995
Public Service		133,989		136,824
Seniors
Department of Seniors		1,813		1,748
Service Nova Scotia and Municipal Relations
Department of Service Nova Scotia and Municipal Relations		265,383		269,248
Nova Scotia Coordinate Referencing System Trust Fund		61		—
Nova Scotia Municipal Finance Corporation		844		854
		266,288		270,102
Transportation and Infrastructure Renewal
Department of Transportation and Infrastructure Renewal		455,799		416,515
Harbourside Commercial Park Inc.		745		673
Nova Scotia Lands Inc.		1,367		559
		457,911		417,747
Restructuring Costs		148,721		136,475
Restructuring of Nova Scotia Agricultural College		—		36,996
Pension Valuation Adjustment		388,160		108,510
Refundable Tax Credits		101,983		127,145

97

Schedule 2 Expenses (continued) For the fiscal year ended March 31, 2014 ($ thousands)

	2014		2013
			(as restated)
Debt Servicing Costs
General Revenue Fund		826,209		871,273
Annapolis Valley District Health Authority		802		808
Annapolis Valley Regional School Board		893		862
Cape Breton District Health Authority		2,031		2,078
Cape Breton Victoria Regional School Board		1,089		992
Capital District Health Authority		8,105		8,148
Chignecto-Central Regional School Board		1,522		1,445
Colchester East Hants Health Authority		467		483
Conseil scolaire acadien provincial		403		354
Cumberland Health Authority		362		379
Guysborough Antigonish Strait Health Authority		492		509
Halifax Regional School Board		4,207		4,153
Housing Nova Scotia		17,963		19,841
Izaak Walton Killam Health Centre		1,936		1,928
Nova Scotia Community College		1,721		1,685
Nova Scotia Innovation Corporation		81		82
Nova Scotia Legal Aid Commission		408		384
Nova Scotia Municipal Finance Corporation		175		152
Nova Scotia Strategic Opportunities Fund Incorporated		3,276		3,168
Nova Scotia Utility and Review Board		38		39
Perennia Food and Agriculture Incorporated		28		—
Pictou County Health Authority		487		514
Renova Scotia Bioenergy Inc.		10,400		(800	)
Resource Recovery Fund Board Inc.		15		—
Sherbrooke Restoration Commission		56		12
South Shore District Health Authority		566		584
South Shore Regional School Board		509		574
South West Nova District Health Authority		740		760
Strait Regional School Board		637		516
Trade Centre Limited		69		74
Tri-County Regional School Board		481		464
Waterfront Development Corporation Limited		21		23
Waycobah School Assistance Fund		6		—
		886,195		921,484
Total Expenses		10,714,020		10,407,754

98

Schedule 3

Loans and Investments

As at March 31, 2014

($ thousands)

	Loans and Investments		Provisions		Net 2014		Net 2013
Loans
Agriculture and Rural Credit Act		179,471		10,524		168,947		157,708
Educational & Services Products (NS) Ltd		15		—		15		15
Education - Student Loans Direct Lending		208,638		107,185		101,453		114,241
Fisheries Development Act		110,243		2,406		107,837		106,515
Halifax-Dartmouth Bridge Commission		—		—		—		2,000
Nova Scotia Business Inc.		62,228		22,092		40,136		36,980
Housing Nova Scotia		592,709		3,874		588,835		585,515
Nova Scotia Innovation Corporation		5,337		3,237		2,100		1,850
Nova Scotia Jobs Fund Act		383,615		127,834		255,781		175,084
Nova Scotia Market Development
Initiative Fund		3,360		—		3,360		4,480
Nova Scotia Municipal Finance Corporation		790,252		—		790,252		764,182
Nova Scotia Strategic Opportunities
Fund Incorporated		75,791		—		75,791		74,991
Perennia Food and Agriculture Incorporated		—		—		—		113
Resource Recovery Fund Board Inc.		212		—		212		238
Venture Corporations Act		809		809		—		—
Waterfront Development Corporation Limited		23		—		23		—
Total Loans Receivable		2,412,703		277,961				2,023,912
Investments
Art Gallery of Nova Scotia		2,831		—		2,831		2,247
Capital District Health Authority		71,418		—		71,418		59,373
Gambling Awareness Foundation of Nova Scotia		3,554		—		3,554		3,444
Nova Scotia Business Inc.		50,089		20,612		29,477		36,800
Nova Scotia Community College		5,701		—		5,701		3,200
Nova Scotia Innovation Corporation		26,308		9,427		16,881		14,938
Nova Scotia Jobs Fund Act		30,441		23,441		7,000		17,600
Nova Scotia School Insurance Program		9,495		—		9,495		8,711
Perennia Food and Agriculture Incorporated		1,343		—		1,343		719
Public Archives of Nova Scotia		1,024		—		1,024		1,015
Total Investments		202,204		53,480		148,724		148,047

The provisions listed above include $5.9 million (2013 - $6.3 million) for possible guarantee payouts from the Nova Scotia Jobs Fund Act. Also included in the provisions is $9.5 million (2013 - $10.0 million) for the Debt Reduction Assistance Program of the Education Student Loans of which $3.5 million (2013 - $3.7 million) relates to the student loans guaranteed by the Province.

99

Schedule 4 Unmatured Debt As at March 31, 2014 ($ thousands)

	Gross Unmatured Debt		Sinking Funds and Defeasance Assets		Net Unmatured Debt 2014		Net Unmatured Debt 2013
General Revenue Fund		15,323,369		2,531,101		12,792,268		12,655,796
Capital District Health Authority		662		—		662		901
Housing Nova Scotia		189,623		—		189,623		202,119
Nova Scotia Municipal
Finance Corporation		7,959		—		7,959		8,749
Nova Scotia Power
Finance Corporation		881,590		881,590		—		—
Waterfront Development
Corporation Limited		885		—		885		1,680
Total Unmatured Debt		16,404,088		3,412,691		12,991,397		12,869,245

Gross Unmatured Debt

All debt is presented in Canadian dollar equivalents and after giving effect to currency swap contracts itemized in Note 13.

Gross Unmatured Debt consists of the outstanding current and long-term debt of the Province’s governmental units, as well as the unmatured debt of the General Revenue Fund. Current and long-term debt of the government business enterprises is reflected in the Province’s Investment in Government Business Enterprises and further detailed in Schedule 6.

100

Schedule 4

Unmatured Debt (continued)

As at March 31, 2014

($ thousands)

Sinking Fund Assets

As at March 31, 2014, the General Revenue Fund held Sinking Funds and Public Debt Management Funds of $2,531.1 million (2013 - $2,694.2 million). These funds were comprised of $2,369.0 million in Sinking Funds and $162.1 million in Public Debt Management Funds. The total market value of both funds was $2,690.0 million at year-end. During the year, contributions were $39.4 million, total earnings were $111.5 million, and total redemptions were $313.9 million.

Sinking fund assets are recorded at cost, which include premiums and discounts associated with the purchase of these investments. These premiums and discounts are amortized on a straight-line basis over the term of the related investment. The net unamortized portion of the premiums and discounts as at March 31, 2014 was $39.2 million (2013 - $43.0 million) and is included as part of the value of the sinking funds.

Sinking fund assets consist primarily of debentures of the Provinces and Government of Canada with fixed interest rates ranging from 2.75% to 10.00%. Sinking fund payments normally commence on the first anniversary date of the issue of the debenture and are designed to retire the debt over the relevant period to maturity. At year-end, the Province held a carrying value of $559.2 million (2013 - $675.9 million) of its own debentures in Sinking Funds and Public Debt Management Funds as active investments.

As per the Nova Scotia Power Corporation Privatization Agreement, Nova Scotia Power Finance Corporation provides for defeasance of its debt. The portfolio of defeasance assets consists of Nova Scotia Power Corporation, other Provincial Governments and utilities, Federal US bonds, coupons or residuals. This debt is shown net of defeasance assets on the Statement of Financial Position.

Projected net principal repayments, capital lease payments, and sinking fund requirements for the next five years and thereafter are as follows:

	Net Principal Repayments		Capital Lease Payments		Sinking Fund Payments		Total Payments
2015		568,834		28,379		29,831		627,044
2016		995,577		30,318		29,831		1,055,726
2017		905,005		32,492		29,831		967,328
2018		415,965		34,748		29,831		480,544
2019		989,058		34,028		27,725		1,050,811
2020 & thereafter		8,689,753		63,957		56,234		8,809,944
		12,564,192		223,922		203,283		12,991,397

Net principal repayments are comprised of the principal amounts due on loans and debentures less available designated sinking funds to retire the debentures.

In addition, the Province has approximately $827.2 million (2013 - $814.8 million) in unrestricted sinking funds that can be used towards the retirement of any unmatured debt. The use of these funds is evaluated each year based on a detailed analysis of cash requirements and market conditions.

101

Schedule 5 Gross Unmatured Debt As at March 31, 2014 ($ thousands)

	Foreign Exchange Rate		CDN $ Amount		Maturity Dates		Interest Rates
Debentures
General Revenue Fund
General Revenue Fund (CDN$)				15,072,228		2014 to 2062		3.44% to 11.75%
General Revenue Fund (US$)		0.9047		—		2015 to 2022		2.38% to 9.50%
General Revenue Fund (UK£)		0.5426		—		2019		11.75%
Nova Scotia Municipal Finance Corporation				7,959		2014 to 2032		1.00% to 2.62%
Nova Scotia Power Finance Corporation (CDN$)				550,000		2014 to 2031		10.25% to 11.25%
Nova Scotia Power Finance Corporation (US$)		0.9047		331,590		2021		9.40%
Total Debentures				15,961,777
Loans
General Revenue Fund - Other Debt		27,881		2014 to 2018		1.35% to 3.36%
Housing Nova Scotia				189,623		2014 to 2034		1.53% to 10.50%
Waterfront Development Corporation Limited				885		Demand loan		—
Total Loans				218,389
Capital Leases
General Revenue Fund				223,260		2018 to 2026		6.04% to 7.25%
Capital District Health Authority				662		2016 to 2017		6.19% to 6.29%
Total Capital Leases				223,922
Gross Unmatured Debt				16,404,088

Call, Redemption and Other Features

General Revenue Fund

Canadian debentures include $1,079.4 million in CPP debentures, which are redeemable in whole or in part before maturity, on six months notice, at the option of the Minister of Finance of Canada.

The interest rates shown for the Canadian and US debentures reflect the fixed interest rates only. There are debentures that have floating interest rates. Floating interest rates are adjusted on a quarterly basis.

Housing Nova Scotia

Mortgages and notes payable are secured by investments in social housing.

102

Schedule 6

Government Business Enterprises

As at March 31, 2014

($ thousands)

	2014												2013
	Halifax- Dartmouth Bridge Commission		Highway 104 Western Alignment Corporation		Nova Scotia Liquor Corporation		Nova Scotia Provincial Lotteries and Casino Corporation		QEII Health Sciences Centre Auxiliary		Total		Total
Cash		9,270		685		13,612		20,913		2,116		46,596		44,470
Accounts Receivable		306		1,593		1,843		32,751		613		37,106		5,227
Inventory		—		8		47,196		2,775		307		50,286		47,955
Investments		15,903		34,311		—		1		—		50,215		52,920
Tangible Capital Assets		98,400		36,534		45,369		95,240		1,449		276,992		277,440
Other Assets		183		480		5,590		13,685		3		19,941		20,254
Total Assets		124,062		73,611		113,610		165,365		4,488		481,136		448,266
Accounts Payable		3,798		680		40,867		103,240		4,125		152,710		121,350
Unmatured Debt		42,000		43,554		20		45,758		—		131,332		144,376
Other Liabilities		3,287		7,639		28,350		16,117		261		55,654		70,383
Total Liabilities		49,085		51,873		69,237		165,115		4,386		339,696		336,109
Equity		74,977		21,738		44,373		250		102		141,440		112,157
Total Liabilities and Equity		124,062		73,611		113,610		165,365		4,488		481,136		448,266
Total Revenue		32,456		22,113		598,847		406,697		9,044		1,069,157		1,074,321
Debt Servicing		2,286		7,522		1,154		1,292		—		12,254		13,399
Other Expenses		17,885		12,951		369,447		296,414		8,949		705,646		706,567
Total Expenses		20,171		20,473		370,601		297,706		8,949		717,900		719,966
Net Income		12,285		1,640		228,246		108,991		95		351,257		354,355

103

Schedule 6 Government Business Enterprises (continued) As at March 31, 2014

Halifax-Dartmouth Bridge Commission

The Halifax-Dartmouth Bridge Commission (HDBC), operating as Halifax Harbour Bridges, was created in 1950 by a special statute of the Province of Nova Scotia (now the Halifax-Dartmouth Bridge Commission Act). The purpose of HDBC is to construct, maintain, and operate bridges and their necessary approaches across the Halifax Harbour, between the communities of Halifax and Dartmouth, and across the North West Arm.

HDBC currently operates and maintains two toll bridges across the Halifax Harbour; the Angus L. Macdonald Bridge and the A. Murray MacKay Bridge. In accordance with the Halifax-Dartmouth Bridge Commission Act, the Nova Scotia Utility and Review Board, a provincially controlled public sector entity, sets the rates, tolls, and charges to be paid for the use of the two bridges operated by HDBC.

Long-Term Loan Agreement

On July 25, 2007, HDBC entered into a long-term loan agreement with the Province for $60.0 million with a final maturity date of December 4, 2019. This agreement requires annual principal repayments of $3.0 million plus interest, with a final principal repayment of $27.0 million along with all accrued and unpaid interest thereon due on the final maturity date. At March 31, 2014, HDBC had $39.0 million (2013 - $42.0 million) of long-term debt and $3.0 million (2013 - $3.0 million) of debt maturing within one year.

Interest is payable semi-annually on July 4 and December 4 of each year. The average interest rate over the life of the loan is 5.13%. This debt is unsecured. For the period ending March 31, 2014, interest expense on the long term debt was $2.3 million (2013 – $2.4 million), of which $694.0 thousand (2013 – $742.0 thousand) was payable at year-end.

This agreement also requires that HDBC maintain three reserve funds: the Operating, Maintenance & Administrative Fund (OM Fund), Debt Service Fund, and Capital Fund. At March 31, 2014, these restricted assets totaled $15.9 million (2013 – $14.0 million) and were invested in GICs with a rate of 1.25% and various provincial bonds with annual yields of 3.99% to 10.00%.

Line of Credit Agreement

On June 30, 2008, HDBC entered into an agreement with the Province for a $60.0 million revolving, unsecured line of credit. At March 31, 2014, HDBC had no advances outstanding against this line of credit (2013 - $2.0 million) and no accrued interest for the year (2013 – $27.0 thousand, of which $8.0 thousand was payable at year-end).

104

Schedule 6

Government Business Enterprises (continued)

As at March 31, 2014

Highway 104 Western Alignment Corporation

The Highway 104 Western Alignment Corporation (H104) was established for the purpose of financing, designing, constructing, operating, and maintaining a 45 km stretch of highway (referred to as the Cobequid Pass) between Masstown and Thomson Station in the counties of Colchester and Cumberland, Nova Scotia.

Related Party Transactions

Included in the financial statements of H104 are transactions with various Crown corporations, ministries, agencies, boards and commissions related to H104 by virtue of common control by the Province. All other transactions with parties under the control of the government are routine operating transactions carried out as part of H104’s normal day-to-day operations. These routine transactions are individually insignificant and include maintenance services, enforcement costs, and purchases of inventory and property, plant and equipment. Collectively the transactions increase enforcement costs by $60.0 thousand (2013 – $60.0 thousand), maintenance services by $1.2 million (2013 – $1.2 million), inventory by $25.8 thousand (2013 – $25.8 thousand), and property, plant and equipment by $254.0 thousand (2013 – $94.6 thousand).

At March 31, 2014, H104 had a receivable from the Province in the amount of $637.3 thousand (2013 – $638.4 thousand). Government grants are recognized initially as deferred income at fair value when there is reasonable assurance that they will be received and H104 will comply with the conditions associated with them. Grants to cover expenses incurred are recognized in profit or loss on a systematic basis in the same periods in which the expenses are recognized. Grants to cover the cost of an asset are deferred and amortized to operations over the expected project life or useful life of the asset using the straight-line method.

Omnibus Agreement

The Omnibus Agreement, dated April 1, 1996, is an agreement between H104, the Contractor, the Operator, and the Province to design, finance, construct, operate and maintain the Highway 104 Western Alignment. Under this agreement, the Province of Nova Scotia retains ownership of the highway. However, H104 is granted the right to operate the highway and collect tolls for a 30-year period, after which time the right will revert to the Province.

Restricted accounts for capital reserve, major maintenance reserve, and debt service reserve have been established in accordance with the Omnibus Agreement. Restricted assets totaling $34.3 million (2013 – $38.9 million) are comprised of investments that are recorded at fair value and include accrued interest of $67.8 thousand (2013 – $91.4 thousand), have a weighted average term of 6.86 (2013 – 6.77) months to maturity, and a weighted average interest rate of 1.16 per cent (2013 – 1.20 per cent).

Annual Roadway Maintenance Agreement

The annual roadway maintenance agreement is a 30-year agreement between H104 and the Department of Transportation and Infrastructure Renewal for the provision of annual roadway maintenance services and is renewable in five year increments. The annual fee was $1.2 million for the current fiscal year (2013 – $1.2 million). During the year, H104 incurred management fees of $226.8 thousand (2013 – $94.6 thousand) from the Province.

105

Schedule 6 Government Business Enterprises (continued) As at March 31, 2014

Highway 104 Western Alignment Corporation (continued)

Long-Term Debt

Long-term debt is comprised of senior toll revenue bonds bearing interest of 10.25 per cent per year, compounded semi-annually, and maturing March 31, 2026. The bonds are payable in equal installments of interest and principal. At year-end, H104 had $41.6 million (2013 – $48.4 million) of long-term debt and $2.0 million (2013 – $2.0 million) of debt maturing within one year. Interest expense on the long term debt was $7.5 million (2013 – $8.8 million) for the year.

Minimum principal repayments for the next five years are as follows: 2015 – $2.0 million

2016 – $2.2 million

2017 – $2.4 million

2018 – $2.7 million

2019 – $3.0 million

As security, H104 has provided an assignment of all the present and future property and assets, including rights to operate the facility, and a security interest in the Debt Service Reserve Account and the Major Maintenance Reserve Account.

Nova Scotia Liquor Corporation

The Nova Scotia Liquor Corporation (NSLC) derives its mandate from the Liquor Control Act, Chapter 260 of the Revised Statutes of Nova Scotia, 1989. NSLC was created June 1, 2001, by Chapter 4 of the Government Restructuring (2001) Act, via continuance of the Nova Scotia Liquor Commission as a body corporate.

NSLC operates retail sales locations across the province and has a fiscal year-end of March 31. In 2014, remittances to the Minister of Finance totaled $226.0 million (2013 – $224.5 million).

Obligations under Finance Lease

At March 31, 2014, NSLC had long-term obligations under finance lease of $1.0 thousand (2013 – $21.0 thousand) and current obligations under finance lease of $19.0 thousand (2013 – $20.0 thousand). Interest expense on the finance lease obligations was $2.0 thousand (2013 – $2.0 thousand) for the year.

Equity

Upon conversion to International Financial Reporting Standards (IFRS) in 2012, NSLC reclassified its payable to the Minister of Finance from a liability to equity. At March 31, 2014, NSLC’s equity was $44.4 million (2013 – $39.8 million).

106

Schedule 6

Government Business Enterprises (continued)

As at March 31, 2014

Nova Scotia Provincial Lotteries and Casino Corporation

The Nova Scotia Gaming Corporation (NSGC) was incorporated on February 15, 1995 by Chapter 4 of the Acts of 1994-95, the Gaming Control Act. The Gaming Control Act was amended on November 13, 2012, whereby the name of NSGC was changed to Nova Scotia Provincial Lotteries and Casino Corporation (NSPLCC). The principal activities of NSPLCC are to develop, undertake, organize, conduct, and manage casinos and other lottery business on behalf of the Province of Nova Scotia. Revenues of NSPLCC are derived from two casinos, located in Halifax and Sydney, as well as ticket and video lottery sales.

Payable to the Province

At March 31, 2014, NSPLCC had a payable to the Province in the amount of $84.8 million (2013 – $54.9 million).

Capital Lease Arrangements

At March 31, 2014, NSPLCC had long-term commitments for minimum lease payments relating to non-cancellable capital leases of $0.3 million (2013 – $0.5 million) and current portion of long-term leases of $0.3 million (2013 – $0.9 million). Interest expense related to software under capital lease was $36.0 thousand (2013 – $68.0 thousand) for the year.

The aggregate payment of long-term leases payable for the next five years are as follows:

2015 – $0.3 million

2016 – $0.1 million

2017 – $0.1 million

2018 – $33.0 thousand

2019 – $nil

Special Payments to Government Departments

NSPLCC is obligated to make direct payments annually to three provincial government departments: Department of Communities, Culture and Heritage (in support of the Cultural Federation of Nova Scotia), Department of Agriculture (in support of the Exhibition Association of Nova Scotia), and Department of Health and Wellness (in support of Sport Nova Scotia). These payments totaled $0.2 million (2013 – $0.2 million).

Additionally, as part of its Gaming Strategy, the Province approved a contribution of $3.0 million to the Department of Health and Wellness in 2014 (2013 – $3.0 million) to fund problem gambling treatment.

Gambling Awareness Foundation Contribution

Video Lottery (VL) retailers in Nova Scotia have agreed, under the terms of their agreements with Atlantic Lottery Corporation Inc., to contribute one per cent of their VL commission to the Gambling Awareness Foundation of Nova Scotia. NSPLCC has agreed to contribute an amount equal to all contributions made by the VL retailers. At March 31, 2014, NSPLCC had a payable to the Gambling Awareness Foundation in the amount of $35.0 thousand (2013 – $38.0 thousand).

Harness Racing Fund Contribution

NSPLCC annually contributes to the Nova Scotia Harness Racing Fund, pursuant to the Nova Scotia Harness Racing Fund Regulations. These contributions go towards supporting the harness racing industry in Nova Scotia. In 2014, the contribution was $1.0 million (2013 – $1.0 million).

107

Schedule 6 Government Business Enterprises (continued) As at March 31, 2014

Nova Scotia Provincial Lotteries and Casino Corporation (continued)

Due to Atlantic Gaming Equipment

At March 31, 2014, the amount due to Atlantic Gaming Equipment Limited was $45.8 million (2013 – $48.9 million). This liability represents a portion of Atlantic Lottery Corporation Inc.’s (ALC) debt used in the acquisition of property, plant and equipment operated on behalf of NSPLCC. All amounts are payable by ALC and are due on or before August 2026. The debt is based on variable interest rates ranging from 1.83 to 2.88 per cent. The aggregate maturity of long-term debt for the years subsequent to March 31, 2014 is approximately as follows:

2015 – $21.9 million

2016 – $7.8 million

2017 – $4.7 million

2018 – $4.8 million

2019 – $4.9 million

Included in interest expense is $1.1 million (2013 - $0.8 million) relating to long-term debt.

Disputed HST Assessments

Included in accounts receivable at March 31, 2014 is $31.6 million that was paid to Canada Revenue Agency, on a without prejudice basis, for an assessment of HST in respect to the operation of certain video lottery terminals. The assessment is being contested and the outcome is undeterminable at this time, so no amounts related to the contingent liability have been accrued in NSPLCC’s financial statements.

Queen Elizabeth II Health Sciences Centre Auxiliary

The Queen Elizabeth II Health Sciences Centre Auxiliary, operating as Partners for Care, is a volunteer based non-profit, charitable organization. The primary objective of Partners for Care is to generate revenue for Capital District Health Authority (CDHA) through parking and retail services, rental activities, and other special projects that generally take place within the hospital premises. Partners for Care was identified and consolidated as a government business enterprise by CDHA.

Payable to Capital District Health Authority

At March 31, 2014, Partners for Care had a payable to CDHA in the amount of $4.0 million (2013 – receivable from CDHA in the amount of $1.3 million).

Capital Lease

At March 31, 2014, Partners for Care had a current obligation under capital lease of $nil (2013 – $23.0 thousand).

Transfers to Capital District Health Authority

Transfers to CDHA totaled $4.8 million in 2014 (2013 – $nil).

108

Schedule 7

Tangible Capital Assets

As at March 31, 2014

($ thousands)

	2014																		2013
	Land			Buildings and Land Improve- ments			Machinery, Computers and Equipment			Vehicles and Ferries			Roads, Bridges and Highways			Total			Total
Costs
Opening Costs					4,612,659			1,422,827			149,639			2,386,660			9,522,617			8,954,845
Transfers		(7	)		7,947			(8,197	)		—			—			(257	)		—
Additions		15,373			187,143			90,613			17,581			235,340			546,050			690,862
Disposals		(199	)		(2,288	)		(12,818	)		(2,422	)		—			(17,727	)		(123,090	)
Closing Costs		965,999			4,805,461			1,492,425			164,798			2,622,000			10,050,683			9,522,617
Accumulated Amortization
Opening Accumulated Amortization		—			(1,938,798	)		(1,036,710	)		(91,475	)		(1,055,452	)		(4,122,435	)		(3,832,630	)
Transfers		—			(3,714	)		3,771			—			—			57			—
Disposals		—			1,157			11,903			2,403			—			15,463			93,093
Amortization Expense		—			(145,041	)		(89,678	)		(12,299	)		(152,778	)		(399,796	)		(382,898	)
Closing Accumulated Amortization		—			(2,086,396	)		(1,110,714	)					(1,208,230	)		(4,506,711	)		(4,122,435	)
Net Book Value		965,999			2,719,065			381,711			63,427			1,413,770			5,543,972			5,400,182
Opening Balance		950,832			2,673,861			386,117			58,164			1,331,208			5,400,182			5,122,215
Closing Balance		965,999			2,719,065			381,711			63,427			1,413,770			5,543,972			5,400,182
Increase (Decrease) in Net Book Value		15,167			45,204			(4,406	)		5,263			82,562			143,790			277,967

109

Schedule 7 Tangible Capital Assets (continued) As at March 31, 2014

Amortization is calculated on a declining balance basis for most assets of the General Revenue Fund. The amortization percentages of the more common tangible capital assets are as follows:

Buildings and Land Improvements	5 - 30 per cent
Machinery, Computers and Equipment	15 - 50 per cent
Vehicles and Ferries	15 - 35 per cent
Roads, Bridges and Highways	5 - 15 per cent

Capital leases of the General Revenue Fund are amortized on a straight-line basis over the length of each lease, ranging from 3 to 25 years.

Amortization is generally calculated on a straight-line basis for assets of the governmental units. The estimated useful lives of the more common tangible capital assets are as follows:

Buildings (including Leasehold Improvements) and Land Improvements	3 - 50 years
Machinery, Computers and Equipment	2 - 50 years
Vehicles and Ferries	3 - 7 years

Capital leases of the governmental units are amortized on a straight-line basis over the length of each lease, ranging from 5 to 45 years.

Social Housing assets are included in Buildings and Land Improvements and relate to Housing Nova Scotia. These assets are amortized using the straight-line method. The net book value of these assets is $324.7 million (2013 - $339.6 million).

Included in the closing costs of the various classes as at March 31, 2014, are costs for assets under construction, which have not yet been amortized. These costs relate to buildings and land improvements of $186.6 million, machinery, computers and equipment of $59.7 million, vehicles and ferries of $21.4 million, and roads, bridges and highways of $119.5 million.

Capital leases are included in the various classes as at March 31, 2014 as follows: buildings and land improvements - cost of $452.6 million, accumulated amortization of $306.3 million; machinery, computers and equipment - cost of $41.5 million, accumulated amortization of $40.2 million; and vehicles and ferries - cost of $21.3 million, accumulated amortization of $12.9 million.

110

Schedule 8

Direct Guarantees

As at March 31, 2014

($ thousands)

	Authorized 2014		Utilized 2014			Utilized 2013
Bank Loans
Department of Labour and Advanced Education Student Loan Program		6,148		6,148			9,977
Nova Scotia Business Inc.		—		—			300
Nova Scotia Jobs Fund Act		76,300		55,499			45,749
Total Bank Loan Guarantees		82,448		61,647			56,026
Mortgages
Housing Nova Scotia Act		8,394		8,394			8,774
Housing Nova Scotia Act - CMHC Indemnities		68,561		68,561			78,457
Provincial Finance Act		3		3			8
Total Mortgage Guarantees		76,958		76,958			87,239
Total Direct Guarantees		159,406		138,605			143,265
Less: Provision for Guarantee Payout
Department of Labour and Advanced Education Student Loan Program				(771	)		(1,776	)
Housing Nova Scotia Act				(5,695	)		(11,981	)
Nova Scotia Business Inc.				—			(300	)
Nova Scotia Jobs Fund Act				(5,906	)		(6,275	)
				(12,372	)		(20,332	)
Less: Provision for Student Debt Reduction Program
Department of Labour and Advanced Education Student Loan Program				(3,548	)		(3,742	)
Net Direct Guarantees				122,685			119,191
(Not provided for in these Consolidated Financial Statements)

111

Schedule 9 Segment Reporting As at March 31, 2014

Segment reporting is designed to assist users in identifying the resources allocated to support the major activities of government and to better understand the performance of segments.

The following schedules provide segment information for the 2014 and 2013 fiscal years. Segment results represent the activities of that segment and include any inter-segment transactions. Inter-segment eliminations are shown in a separate column. The Province has determined that the following segments represent the major activities of government.

Health

The provision of such services and institutions to the public that will lead to a higher state of personal health.

Education

The provision of all aspects and phases of training to equip people with necessary skills to pursue productive lives. This includes: Primary to Grade 12, post-secondary and advanced education, as well as labour support.

Infrastructure & Public Works

The provision of the means to facilitate the effective and efficient movement of persons and property. This includes the net results of the Halifax-Dartmouth Bridge Commission and the Highway 104 Western Alignment Corporation.

Social Services

The provision of services and assistance to economically and/or socially disadvantaged persons requiring aid.

Natural Resources & Economic Development

The provision for the maintenance and upkeep, efficient extraction, processing, and utilization of the natural attributes of the province with the aim of creating employment and contributing to the material well-being of residents.

Other Government

Revenues and expenses that relate to activities that are not identified as a separate segment or cannot be directly allocated on a reasonable basis to individual segments because they support a wide range of service delivery activities. This includes certain items from the General Revenue Fund such as general tax revenues, sinking fund earnings, debt servicing costs, and the pension valuation adjustment.

112

Schedule 9

Segment Reporting

For the fiscal year ended March 31, 2014

($ thousands)

	Health						Education						Infrastructure & Public Works						Social Services
	2014			2013			2014			2013			2014			2013			2014			2013
				(as restated)						(as restated)						(as restated)						(as restated)
Revenue
Provincial Sources
Tax Revenue		217,229			206,287			—			—			246,800			243,446			—			—
Other Provincial Revenue		412,130			401,594			437,409			433,991			13,928			14,303			105,270			107,725
Net Income from GBEs		95			955			—			—			13,925			13,596			—			—
Investment Income		2,266			2,747			5,467			5,087			—			—			27,122			27,024
Federal Sources		893,858			855,136			278,511			268,099			23,794			27,574			265,196			267,508
Total Revenue		1,525,578			1,466,719			721,387			707,177			298,447			298,919			397,588			402,257
Expenses
Grants and Subsidies		1,680,617			1,658,973			644,396			641,547			418			459			791,899			810,472
Salaries and Employee Benefits		1,675,876			1,586,717			1,161,882			1,143,912			128,743			123,882			165,267			155,815
Operating Goods and Services		762,190			715,597			328,872			325,341			134,367			107,026			112,371			82,215
Professional Services		85,401			95,101			30,520			28,214			15,748			18,166			3,477			3,432
Amortization		99,103			98,214			78,873			76,290			177,734			169,487			20,500			19,245
Debt Servicing Costs		17,014			17,348			11,463			11,044			—			—			43,833			45,571
Other		—			1			—			—			—			—			—			—
Total Expenses		4,320,201			4,171,951			2,256,006			2,226,348			457,010			419,020			1,137,347			1,116,750
Segment Result		(2,794,623	)		(2,705,232	)		(1,534,619	)		(1,519,171	)		(158,563	)		(120,101	)		(739,759	)		(714,493	)

113

Schedule 9 Segment Reporting For the fiscal year ended March 31, 2014 ($ thousands)

	Natural Resources & Economic Development						Other Government					Inter-Segment Eliminations						Total
	2014			2013			2014		2013			2014			2013			2014			2013
Revenue					(as restated	)				(as restated	)					(as restated	)					(as restated	)
Provincial Sources
Tax Revenue		334			363			4,327,424		4,451,698			—			—			4,791,787			4,901,794
Other Provincial Revenue		29,588			142,865			418,125		424,011			(118,544	)		(133,855	)		1,297,906			1,390,634
Net Income from GBEs		—			—			337,237		339,804			—			—			351,257			354,355
Investment Income		14,672			9,818			185,787		184,733			(33,190	)		(34,834	)		202,124			194,575
Federal Sources		103,397			167,617			1,827,299		1,676,831			—			—			3,392,055			3,262,765
Total Revenue		147,991			320,663			7,095,872		7,077,077			(151,734	)		(168,689	)		10,035,129			10,104,123
Expenses
Grants and Subsidies		151,302			200,353			365,812		453,795			(45,997	)		(53,191	)		3,588,447			3,712,408
Salaries and Employee Benefits		137,094			140,122			744,945		448,119			(39,314	)		(48,557	)		3,974,493			3,550,010
Operating Goods and Services		149,144			137,969			90,853		118,882			(5,197	)		(8,703	)		1,572,600			1,478,327
Professional Services		16,127			19,889			138,206		166,126			(599	)		(705	)		288,880			330,223
Amortization		6,407			5,721			17,179		13,941			—			—			399,796			382,898
Debt Servicing Costs		16,468			6,718			857,995		898,035			(60,578	)		(57,232	)		886,195			921,484
Other		3,658			32,704			—		—			(49	)		(301	)		3,609			32,404
Total Expenses		480,200			543,476			2,214,990		2,098,898			(151,734	)		(168,689	)		10,714,020			10,407,754
Segment Result		(332,209	)		(222,813	)		4,880,882		4,978,179			—			—			(678,891	)		(303,631	)

114

Schedule 10

Government Reporting Entity

As at March 31, 2014

The government reporting entity is comprised of the Province’s departments and public service units (General Revenue Fund) as well as the following governmental units, government business enterprises, and a proportionate share of government partnership arrangements:

Governmental Units

(Consolidation Method)

Acadia Coal Company Limited Fund	Nova Scotia Crop and Livestock Insurance Commission
Annapolis Valley District Health Authority	Nova Scotia E911 Cost Recovery Fund
Annapolis Valley Regional School Board	Nova Scotia Environmental Trust
Art Gallery of Nova Scotia	Nova Scotia Farm Loan Board
Arts Nova Scotia	Nova Scotia Fisheries and Aquaculture Loan Board
Bioscience Enterprise Centre Incorporated (inactive)	Nova Scotia Government Acadian Bursary Program Fund
Cape Breton District Health Authority	Nova Scotia Harness Racing Fund
Cape Breton Victoria Regional School Board	Nova Scotia Health Research Foundation
Capital District Health Authority	Nova Scotia Innovation Corporation
Check Inns Limited (inactive)	1402998 Nova Scotia Limited
Chignecto-Central Regional School Board	3087532 Nova Scotia Limited
Coal Research Agreement Fund	Nova Scotia Jobs Fund
Colchester East Hants Health Authority	Nova Scotia Lands Inc.
Conseil scolaire acadien provincial	Nova Scotia Legal Aid Commission
CorFor Capital Repairs and Replacements Fund	Nova Scotia Market Development Initiative Fund
Creative Nova Scotia Leadership Council	Nova Scotia Municipal Finance Corporation
Crown Land Mine Remediation Fund	Nova Scotia Nominee Program Fund
Crown Land Silviculture Fund	Nova Scotia Power Finance Corporation
Cumberland Health Authority	Nova Scotia Primary Forest Products Marketing Board
Democracy 250 (inactive)	Nova Scotia School Boards Association (1)
Film and Creative Industries Nova Scotia	Nova Scotia School Insurance Exchange (2)
Gambling Awareness Foundation of Nova Scotia	Nova Scotia School Insurance Program Association (2)
Gaming Addiction Treatment Trust Fund	Nova Scotia Sportfish Habitat Fund
Guysborough Antigonish Strait Health Authority	Nova Scotia Strategic Opportunities Fund Incorporated
Habitat Conservation Fund	Nova Scotia Tourism Agency
Halifax Regional School Board	Nova Scotia Utility and Review Board
Harbourside Commercial Park Inc.	Off-Highway Vehicle Infrastructure Fund
Sydney Utilities Limited	P3 Schools Capital and Technology Refresh Fund (3)
Housing Nova Scotia	Pengrowth Nova Scotia Energy Scholarship Fund
Cape Breton Island Housing Authority	Perennia Food and Agriculture Incorporated
Cobequid Housing Authority	Pictou County Health Authority
Eastern Mainland Housing Authority	Provincial Drug Distribution Program
Metropolitan Regional Housing Authority	Public Archives of Nova Scotia
Western Regional Housing Authority	Public Debt Management Fund
Izaak Walton Killam Health Centre	Renova Scotia Bioenergy Inc.
Law Reform Commission	Resource Recovery Fund Board Inc.
Muggah Creek Remediation Fund	Rockingham Terminal Incorporated (inactive)
Nova Scotia Arts Council (inactive)	Schooner Bluenose Foundation
Nova Scotia Business Inc.	Scotia Learning Technology Refresh Fund
Nova Scotia Community College	Select Nova Scotia Fund
Nova Scotia Community College Foundation	Sherbrooke Restoration Commission
Nova Scotia Coordinate Referencing System Trust Fund	South Shore District Health Authority

115

Schedule 10 Government Reporting Entity As at March 31, 2014

Governmental Units (continued)	Government Business Enterprises
(Consolidation Method)	(Modified Equity Method)
South Shore Regional School Board	Halifax-Dartmouth Bridge Commission
South West Nova District Health Authority	Highway 104 Western Alignment Corporation
Species-at-risk Conservation Fund	Nova Scotia Liquor Corporation
Strait Regional School Board	Nova Scotia Provincial Lotteries and Casino Corporation
Sustainable Forestry Fund	Atlantic Lottery Corporation (25% ownership)
Sydney Environmental Resources Limited	Interprovincial Lottery Corporation (10% ownership)
(inactive) Sydney Steel Corporation	Nova Scotia Gaming Equipment Limited
Sydney Tar Ponds Agency	Queen Elizabeth II Health Sciences Centre Auxiliary
Sysco Decommissioning
Fund Trade Centre Limited
Tri-County Regional School Board
Upper Clements Family Theme Park Limited	Government Partnership Arrangements
(inactive) Vive l’Acadie Community Fund	(Proportionate Consolidation Method)
Waterfront Development Corporation
Limited 3104102 Nova Scotia Limited	Atlantic Provinces Special Education Authority
Waycobah School Assistance Fund	(approximately 55% share)
3052155 Nova Scotia Limited	Canada-Nova Scotia Offshore Petroleum Board
	(50% share)
	Canadian Sports Centre Atlantic
	(approximately 14% share)
	Council of Atlantic Premiers
	(approximately 46% share)

(1) – Entity is a partnership controlled by the eight school boards.

(2) – Entity is a partnership controlled by the eight school boards and the Nova Scotia Community College.

(3) – This includes all refresh funds related to P3 schools.

116