ONTARIO E LE CTRONIC STE WARDSHIP 2 014 ANNUAL RE P ORT 23 Ontario Electronic Stewardship Notes to Financial Statements December 31 2014 1. Significant Accounting Policies The following is a summary of significant accounting policies of the Organization a Business Organization and Operations The Ontario Electronic Stewardship Organization is set up to act as the Industry Funding Organization for the administration of provincial programs for the reduction reuse and recycling of waste electrical and electronic equipment WEEE pursuant to the Waste Diversion Act 2002. The Organization is a notforprofit organization and as such is not subject to income taxes. On September 20 2007 the Organization was formally incorporated in the province of Ontario as a corporation without share capital. On July 9 2008 the Organization was designated as the Industry Funding Organization for WEEE by regulation under the Waste Diversion Act 2002. The Phase 1 WEEE Program officially commenced April 1 2009. The Phase 1 WEEE Program was expanded to include the Phase 2 materials and to reflect the Revised Phase 1 and 2 Program Plan components which commenced April 1 2010. The Revised Plan encompasses 44 materials grouped into 8 categories. The Organization operates the WEEE Program under the terms of a Program Agreement dated July 10 2009 with Waste Diversion Ontario. On February 19 2013 the Minister of the Environment approved an amendment to the WEEE Program Plan giving effect to the new cost recovery principles for steward feesetting. Effective May 1 2013 steward fees are based on the principal of full cost recovery with provision for appropriate operating reserves material category past deficit recovery over a five year period and annual reconciliation to actual operating costs. b Basis of Accounting The financial statements have been prepared using Canadian accounting standards for notforprofit organizations. c Revenue Recognition Steward fees are recognized as revenue as stewards register with the Organization and submit unit details. Revenues resulting from compliance and enforcement activities are recognized when the amount can be reasonably estimated and collection is reasonably assured. Investment income is recognized on an accrual basis. The Organization follows the deferral method of accounting.