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PRINCE EDWARD ISLAND
LIQUOR CONTROL COMMISSION
Notes to Financial Statements
March 31,2015
12.
Leases and Commitments
The Commission leases fourteen retail outlets. Eleven of those outlets are classified as
operating leases and three retail outlets are classified as finance leases.
Finance Leases
The following are the future minimum lease payments and present values for the finance
leases as at March 31,2015:
Within 1 Year
1 to 5 Years
After 5 Years
$
$
$
$
Minimum ease payments
143,502
574,008
1,960,807
2,678,317
Present value
132,670
437,957
802,769
1,373,396
The present value was calculated by discounting the minimum lease payments using the
estimated interest rates implicit in the lease over the same period as the length of the lease
including any renewal options. Estimated interest rates implicit in the lease range between
7.27 and 9.27 percent.
Operating Leases
The following are the Commission’s future minimum lease payments for the operating
leases:
Within 1 Year
1 to 5 Years
After 5 Years
Renewal ODtions
I2J
$
$
$
$
$
March 31,2015
471,429
839,479
559,746
4,468,560
6,339,214
March 31, 2014
639,837
1,195,132
671,508
5,545,150
8,051,627
Total future minimum operating lease payments include lease renewal options which can be
exercised by the Commission for periods above their current lease contract. Lease payments
recognized as an expense during the period are $632,021 (2014
-
$759,284). Dependent on
the terms of the lease, other costs incurred by the Commission associated with property
leases generally
include
insurance,
taxes,
repairs and maintenance,
and
leasehold
improvements.
Commitments
The Commission has
entered
into contracts with various
suppliers
for
hardware
maintenance, software support services,
internet access, marketing and security services.
The total of these contracts is $783,935 and they expire in one to three years.