Notes to Consolidated Financial Statements


To facilitate a better understanding of the Bank’s Consolidated Financial Statements, significant accounting policies, and related disclosures, a listing of all the notes is provided below.


NOTE TOPIC 1


2 3


4 5 6 7 8 9


10 11 12 13 14 15 16 17 18


Nature of Operations Summary of Significant Accounting Policies


Significant Accounting Judgments, Estimates, and Assumptions


Current and Future Changes in Accounting Policies Fair Value Measurements


Offsetting Financial Assets and Financial Liabilities Securities


Loans, Impaired Loans, and Allowance for Credit Losses Transfers of Financial Assets Structured Entities Derivatives


Investment in Associates and Joint Ventures Significant Acquisitions and Disposals Goodwill and Other Intangibles


Other Assets Deposits


Other Liabilities


PAGE 124


124 133


135 136 147 148 152 155 157 160 167 168 168


Land, Buildings, Equipment, and Other Depreciable Assets 170 170 171 172


NOTE TOPIC 19


20 21 22 23 24 25 26 27 28


29 30 31 32 33 34 35


Subordinated Notes and Debentures Capital Trust Securities Equity


Trading-Related Income Insurance


Share-Based Compensation Employee Benefits Income Taxes


Earnings Per Share


Provisions, Contingent Liabilities, Commitments, Guarantees, Pledged Assets, and Collateral Related Party Transactions Segmented Information Interest Rate Risk Credit Risk


Regulatory Capital Risk Management


Information on Subsidiaries


PAGE 172


173 173 175 176 178 179 184 186


186 189 190 192 194 198 199 199


NOTE 1


NATURE OF OPERATIONS CORPORATE INFORMATION


The Toronto-Dominion Bank is a bank chartered under the Bank Act. The shareholders of a bank are not, as shareholders, liable for any liability, act, or default of the bank except as otherwise provided under the Bank Act. The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Group (“TD” or the “Bank”). The Bank was formed through the amalgamation on February 1, 1955, of The Bank of Toronto (chartered in 1855) and The Dominion Bank (chartered in 1869). The Bank is incorporated and domiciled in Canada with its registered and principal business offices located at 66 Wellington Street West, Toronto, Ontario. TD serves customers in three business segments operating in a number of locations in key financial centres around the globe: Canadian Retail, U.S. Retail, and Wholesale Banking.


BASIS OF PREPARATION


The accompanying Consolidated Financial Statements and accounting principles followed by the Bank have been prepared in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB), including the accounting requirements of the Office of the Superintendent of Financial Institutions Canada (OSFI). The Consolidated Financial Statements are presented in Canadian dollars, unless otherwise indicated.


NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF CONSOLIDATION


The Consolidated Financial Statements include the assets, liabilities, results of operations, and cash flows of the Bank and its subsidiaries including certain structured entities which it controls. The Bank controls an entity when (1) it has the power to direct the activities of the entity which have the most significant impact on the entity’s risks and/or returns; (2) it is exposed to significant risks and/or returns arising from the entity; and (3) it is able to use its power to affect the risks and/or returns to which it is exposed.


The Bank’s Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and events in similar circumstances. All intercompany transactions, balances, and unrealized gains and losses on transactions are eliminated on consolidation.


Subsidiaries


Subsidiaries are corporations or other legal entities controlled by the Bank, generally through directly holding more than half of the voting power of the entity. Control of subsidiaries is determined based on the


These Consolidated Financial Statements were prepared using the accounting policies as described in Note 2. Certain comparative amounts have been restated/reclassified to conform with the presentation adopted in the current period.


The preparation of the Consolidated Financial Statements requires that management make estimates, assumptions, and judgments regarding the reported amount of assets, liabilities, revenue and expenses, and disclosure of contingent assets and liabilities, as further described in Note 3. Accordingly, actual results may differ from estimated amounts as future confirming events occur. The accompanying Consolidated Financial Statements of the Bank were approved and authorized for issue by the Bank’s Board of Directors, in accordance with a recommendation of the Audit Committee, on November 30, 2016.


Certain disclosures are included in the shaded sections of the “Managing Risk” section of the accompanying 2016 Management’s Discussion and Analysis (MD&A), as permitted by IFRS, and form an integral part of the Consolidated Financial Statements. The Consolidated Financial Statements were prepared under a historical cost basis, except for certain items carried at fair value as discussed in Note 2.


124 TD BANK GROUP ANNUAL REPORT 2016 FINANCIAL RESULTS


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