One enrolled child, up to three payers
A centre inside the Canada-wide Early Learning and Child Care system can be paid three ways for one spot: the family pays the capped fee, CWELCC funding flows through your municipal service system manager, and a purchase-of-service agreement covers some or all of the family share where a fee subsidy applies. Each payer has its own rules, its own timing and its own paper trail, and none of them forgive blending. We build the chart of accounts so each stream posts to its own line, all of them tied back to one spine: the enrolment register.
Fee caps have stepped down more than once since 2022, and the cap that took effect in January 2025 set base fees for eligible children at $22 a day. Wherever the cap sits in a given year, the accounting job is constant: what a family may be charged is set by policy, what the funder pays follows enrolment, and the books must prove both, child by child, month by month. End-to-End Accounting keeps bookkeeping, payroll, financial reporting and tax filing in one engagement so that proof exists all year, not just at reporting time.
Funding you may have to give back
CWELCC money arrives as advances and settles later. Since January 2025 Ontario has funded participating operators through a cost-based formula, and your service system manager reconciles what was advanced against what the formula says the centre earned. An over-advance is not revenue, it is a liability, and a centre that spent it as revenue meets that discovery at the worst possible moment.
| Stream | Who pays it | What must reconcile |
|---|---|---|
| Parent fees | Families, at the capped rate | Fee schedule times enrolled days, against deposits on file |
| CWELCC funding | Service system manager | Enrolment reports and the annual reconciliation |
| Fee subsidy | Municipality, under purchase of service | Approved days against attendance records |
| Wage enhancement | Service system manager, by application | Payroll registers showing it reached named staff |
| Registration deposits | Families | Held as a liability until applied or refunded |
We keep a deferred and repayable funding schedule beside the income statement, so at any month-end you can see what has been earned, what is still an advance, and what is likely going back.
Payroll, the cost the ratio writes
Staffing ratios under Ontario's Child Care and Early Years Act make wages the dominant cost of every licensed program, and this payroll carries funder conditions most employers never see. The Provincial Wage Enhancement, up to $2 an hour for eligible program staff, must flow through payroll as wages with CPP, EI and income tax withheld, and we run it as its own pay item so the year-end report to your municipality can show exactly who received it. The RECE wage floor that came with CWELCC rises on a schedule, which means the wage grid needs a review every January, not whenever someone remembers.
The rest is the ordinary hard parts done properly: bi-weekly runs across full-time educators, part-time assistants and supply staff, vacation accruals, public-holiday pay for part-timers, T4s in February, and Employer Health Tax once payroll clears the exemption. How the ratios shape margin room by room is a finance question, covered on our daycare CFO services page.
Parent money has rules of its own
Ontario banned waitlist fees for licensed child care in 2016, so a waitlist is a pipeline, never a revenue line. Registration deposits are still allowed, and they sit on the balance sheet as a liability until applied to fees or refunded; recognizing a deposit as income the day it lands overstates a month you may have to give back. Receipts matter at the other end: families claim child care expenses on Form T778, and they will ask for a year-end receipt in February whether or not your records are ready.
The toolchain keeps this light. Enrolment platforms like Lillio, formerly HiMama, handle registration and pre-authorized payments; we map their deposits into QuickBooks Online by program, push supplier bills through Dext, and keep the parent ledger clean enough that a refund or subsidy adjustment takes minutes. One flag worth knowing: childcare is HST-exempt, so fees carry no tax and the centre recovers none on rent, toys or renovations, a budgeting reality we unpack under daycare tax services.
Month-end a board or a funder could read
Month-end closes with statements by program: infant, toddler, preschool and school-age each carry their own revenue and staffing cost, so cross-subsidies are visible instead of buried in a centre-wide average. Nonprofit centres get reporting a volunteer board can actually use; for-profit owners get margin by room. Where a funder or lender wants CPA-prepared statements, Compilation and Review Engagements sit on top of books we already trust. For centres across Mississauga and the GTA, the fee is quoted in writing after a free 15-minute discovery call, so it is known before the work starts.
