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Financial Tables

In this section:

Table 1: Comparison of Planned to Actual Spending (including FTEs)



($000s) 2004-2005 Actual 2005-2006 Actual 2006-2007
Main Estimates Planned Spending Total Authorities Total Actuals
Effective and Efficient Environmental Assessment 18,272.6 17,578.5 17,383.0 18,033.0 19,524.8 18,372.1
Less: Non-respendable revenue 3.8 18.4 261.8 261.8
Plus: Cost of services received without charge 3,464.4 2,886.7 3,276.0 3,276.0 3,179.5 3,179.5
Total Agency Spending 21,733.2 20,446.8 20,659.0 21,309.0 22,442.5 21,289.8
Full-Time Equivalents 135.0 135.0 149.0 149.0 148.0 148.0

This table provides a summary of resource levels for the last three years, as well as the evolution of the 2006-2007 resources. The fluctuation in total resources over the years is the result of funding changes in various initiatives, such as the Canadian Environmental Assessment Act, the Northern Gas Pipeline Project, collective bargaining and cost of services received without charge. The variance between the Total Authorities and the Actual Spending mainly consists of an approved reprofile of $500K to 2007-2008 for the Participant Funding Program and resources to cover legal services of $535K received from the Department of Justice.

 

Table 2: Resources by Program Activity



2006-2007
  Budgetary ($000s)
Program Activity Operating Contributions Total: Gross Budgetary Expenditures Less: Respendable Revenue Total
Effective and Efficient Environmental Assessment          
Main Estimates 18,941.0 1,943.0 20,884.0 -3,501.0 17,383.0
Planned Spending 18,941.0 2,593.0 21,534.0 -3,501.0 18,033.0
Total Authorities 25,879.1 2,646.7 28,525.8 -9,001.0 19,524.8
Actual Spending 22,915.1 2,049.4 24,964.5 -6,592.4 18,372.1

 

Table 3: Voted and Statutory Items



Vote or Statutory Item Truncated Vote or
Statutory Wording
2006-2007 ($000s)
Main Estimates Planned Spending Total Authorities Total Actuals
20 Program expenditures 15,609.0 16,259.0 17,614.7 16,462.1
(S) Contributions to employee benefit plans 1,774.0 1,774.0 1,909.9 1,909.9
(S) Spending of proceeds from the disposal of surplus Crown assets 0.2
  Total 17,383.0 18,033.0 19,524.8 18,372.1

This table presents resources that have been voted to the Agency by Parliament. It should be noted that Parliament approves the voted funding whereas the statutory information is provided for information purposes. Explanation of variance in resource levels can be found in tables 1 and 2.

 

Table 4: Services Received Without Charge



  2006-2007 ($000s)
Accommodation provided by Public Works and Government Services Canada 1,554.3
Contributions covering employers' share of employees' insurance premiums and expenditures paid by Treasury Board of Canada Secretariat (excluding revolving funds) 824.4
Salary and associated expenditures of legal services provided by the Department of Justice Canada 800.8
Total 2006-2007 Services Received Without Charge 3,179.5

This table reflects the services received without charge from other government departments. For 2006-2007, the actual expenditures were slightly lower than the planned spending reflected in the 2006-2007 Report on Plans and Priorities, mostly because of lower costs than expected for legal services provided by Justice Canada.

 

Table 5: Sources of Respendable and Non-Respendable Revenue



Respendable Revenue
($000s) Actual 2004-2005 Actual 2005-2006 2006-2007
Main Estimates Planned Revenue Total Authorities Actual
Effective and Efficient Environmental Assessment            
Cost recovery for environmental assessment services 877.9 4,167.7 3,351.0 3,351.0 8,851.0 6,305.1
Cost recovery for publications, training and education materials (federal) 105.2 85.8 75.0 75.0 90.0 120.6
Cost recovery for publications, training and education materials (external) 108.0 153.3 75.0 75.0 60.0 166.7
Total
Respendable Revenue
1,091.1 4,406.8 3,501.0 3,501.0 9,001.0 6,592.4
 
Non-Respendable Revenue
($000s) Actual 2004-2005 Actual 2005-2006 2006-2007
Main Estimates Planned Revenue Total Authorities Actual
Effective and Efficient Environmental Assessment 3.8 18.4 261.8 261.8
Total Non-Respendable Revenue 3.8 18.4 261.8 261.8
             
Total Revenues 1,094.9 4,425.2 3,501.0 3,501.0 9,262.8 6,854.2

The Agency has authority to recover costs for environmental assessment services, publications, training and education materials. However, it should be noted that the use of this authority depends on the level of review panel activity that is eligible for cost recovery. As such, the level of revenue tends to fluctuate from year to year.

 

Table 6-A: User Fees Act



User Fee Fee Type Fee-Setting Authority Date Last Modified 2006-2007 ($000s) Planning Years
Forecast Revenue ($000s) Actual Revenue ($000s) Full Cost ($000s) Performance Standard Performance Results Fiscal Year Forecast Revenue ($000s) Estimated Full Cost ($000s)
Environmental assessment services R Environmental Assessment Review Panel Services Charges Order 2002 3,351.0 6,305.1 9,129.8 The Agency has identified shortcomings with the existing performance standards, specifically with regards to the sufficiency of the Cost Recovery Order. The Agency has developed and is piloting a Participant Satisfaction Survey to establish indicators (such as fairness, accessibility, timeliness, efficiency and value for investment) to allow for qualitative performance evaluation. The Agency will use these measures in the 2007-2008 DPR. 2007-2008


2008-2009


2009-2010

3,351.0



3,351.0



3,351.0

4,926.0



4,926.0



4,926.0
Fees charged for the processing of access requests filed under the Access to Information Act O Access to Information Act 1992 0.1 122.5 Service standards are in the Access to Information Act, section 7: http://laws.justice.gc.ca/en/a-1/218072.html Statutory deadlines were met 83% of the time 2007-2008


2008-2009


2009-2010

0.3



0.3



0.3

129.7



147.3



164.9
      Sub-total
(R)
3,351.0 6,305.1 9,129.8     Total 2007-2008 3,351.3 5,055.7
      Sub-total
(O)
0.1 122.5     Total 2008-2009 3,351.3 5,073.3
      Total 3,351.0 6,305.2 9,252.3     Total 2009-2010 3,351.3 5,090.9

For 2006-2007, environmental assessment services constitute the main source of revenues of the Agency. This amount is subject to variation depending on the level of review panel activity that is eligible for cost recovery. Reflected forecasted revenues of $3,351K are based on authorities. As review panel activity increases additional authorities will be sought. Full costs of environmental assessment services are based on actual revenues for 2006-2007 and forecasted revenues for 2007-2008, 2008-2009 and 2009-2010 adjusted for an estimated portion of the cost provided without charge1 and other costs that can not be recovered under the current authorities.

Actual and forecasted revenues for Access to Information and Privacy ( ATIP ) are based on a set fee per request as prescribed in the Access to Information Act. Full costs are based on actual costs related to generating the required information adjusted by an estimated portion of the cost provided without charge.

 

Table 6-B: Policy on Service Standards for External Fees

Supplementary information on Service Standards for External Fees can be found at:

http://www.tbs-sct.gc.ca/rma/dpr3/06-07/index_e.asp

 

Table 7: Progress against the Agency's Regulatory Plan



Regulatory Initiatives Expected Results Results Achieved
Development of Crown Corporation Regulations

Crown corporations will come under the Act in June 2006. The Agency will help these organizations meet their new obligations. New regulations will vary the assessment process for Crown corporations involved in the provision of commercial loans. The Exclusion List Regulations will be reviewed and amended to ensure that it takes into account the needs of Crown corporations.

  • The Agency will assist Crown corporations in implementing their new obligations under the Act. Regulations will be developed to address the unique business activities of Crown corporations involved in the provision of commercial loans. Changes to the Exclusion List Regulations will allow for more efficient use of environmental assessment resources.

39 of 41 parent Crown Corporations came under the Act in June 2006 with no need for a regulatory variation modifying the environmental assessment process.

A regulation varying the environmental assessment process for two Crown corporations that provide commercial loans came into force on June 11, 2006. The regulation allows them to implement their new responsibilities under the Act while maintaining their ability to deliver their services in a competitive environment.

Proposed changes to the Exclusion List Regulations were developed by interested Crown corporations in collaboration with the Agency. The Minister's multi-stakeholder Regulatory Advisory Committee, the federal Senior Management Committee on Environmental Assessment, and other Crown corporations were consulted on the proposed changes.

Amendments to the Exclusion List Regulations

New entries will be added to these regulations to prescribe new classes of projects to be excluded from environmental assessment and to modify thresholds of certain existing entries.

  • Reductions in the number of environmental assessments of projects having insignificant effects conducted by federal responsible authorities, particularly with regard to screening assessments.
  • More efficient and effective use of environmental assessment resources.
A new version of the regulations was prepared for final approvals, with a target date for coming into force in the late spring of 2007.
Amendments to Federal Coordination Regulations

Federal Coordination Regulations will be amended to take into account changes brought about in 2003 by the renewed Act.

  • Increased coordination among federal departments in fulfilling environmental assessment requirements and improved coordination with other participants in the environmental assessment process, including provinces, industry, environmental organizations and others.
  • A more timely and predictable environmental assessment process.
  • Increased transparency in the environmental assessment process.

In response to comments received on the previous proposals, and in light of the new Cabinet Directive on Implementing the Canadian Environmental Assessment Act, a new approach to amending the Federal Coordination Regulations was developed. Federal departments and agencies were consulted on the approach and a draft plain language version of the proposed regulations was prepared.

Amendments to Canada Port Authority Environmental Assessment Regulations

In accordance with changes brought about by the renewed Act in 2003, amendments to these regulations are needed to ensure the comprehensiveness, consistency, transparency and overall quality of port authorities' environmental assessment processes.

  • Environmental assessment procedures for port authorities will be consistent with provisions of the amended Act, particularly with regard to comprehensive studies and the Registry.
Port authorities, federal departments and the Regulatory Advisory Committee were consulted on a final unofficial draft of a new version of the Canada Port Authority Environmental Assessment Regulations. Drafting the final new regulation is in progress.
Airport Authority Regulations

In accordance with changes brought about by the renewed Act, these regulations will close a gap in the Act by requiring airport authorities to conduct an assessment of the environmental effects of projects located on the federal land over which those authorities have administration, management or other specified rights or interests.

  • An environmental assessment process that captures all appropriate airport authority activities for assessment.
Consultation and discussions with the airport authorities and Transport Canada have been ongoing, and new draft airport authority regulations are expected to follow shortly after completion of the new port authority regulations.
Review of Four Key Regulations Under the Act

In accordance with changes brought about in 2003 by the renewed Act, the Inclusion List Regulations, Law List Regulations, Comprehensive Study List Regulations and Exclusion List Regulations will be reviewed to ensure they remain relevant to government programs and priorities.

  • Regulations kept current, reflecting latest approaches and experience with environmental assessment.
A major revision of the Exclusion List Regulations was prepared with a target date for coming into force by the late spring of 2007. Projects were undertaken toward amendments of the other four key regulations. A discussion paper was made available to the public on proposed amendments that would add the International Boundary Waters Treaty Act to the Law List Regulations and the Inclusion List Regulations. A review of section 10 of the Comprehensive Study List Regulations was initiated with Infrastructure Canada.

A Crown corporation-focused review of the Exclusion List Regulations was initiated.


 

Table 8: Response to Parliamentary Committees, and Audits and Evaluations



Response to Parliamentary Committees
During the reporting period, the Agency did not table any responses to Parliamentary Committee reports.
Response to the Auditor General including to the Commissioner of the Environment and Sustainable Development (CESD)
During the reporting period, no recommendation of the Auditor General was addressed specifically to the Agency.
External Audits (Note: These refer to other external audits conducted by the Public Service Commission of Canada (PSC) or the Office of the Commissioner of Official Languages.)
During 2006-2007, two audits (Hospitality and Travel Claims) were conducted by a central agency (Treasury Board Secretariat). The results of these audits will be reported in the next Departmental Performance Report.
Internal Audits or Evaluations
During the reporting period, the Agency did not undertake any audits or evaluations.

 

Table 9: Sustainable Development Strategy



Points to Address Input
1. What are the key goals, objectives, and/or long-term targets of the Sustainable Development Strategy? The 2007-2009 Sustainable Development Strategy (SDS) 20-year vision frames the goals, objectives and long-term targets for the Agency. The long-term vision of the SDS is to take into account environmental considerations, alongside economic and social ones, in all federal government decisions respecting policies, plans, programs and projects in a way that supports balanced, integrated decision making and progress toward sustainable development.

The Agency recognizes that to achieve its vision, it must shift from leading a process-oriented federal environmental assessment framework to a results-oriented one, viewing the success of its initiatives through improvement in process as well as through improvements in the results it influences. The long-term goal of the 2007-2009 Sustainable Development Strategy is therefore to promote the full and meaningful application of a results-oriented federal environmental assessment framework. As such, the following three main objectives have been identified:

  • development of effective, efficient and mutually supportive environmental analysis tools;
  • early, full and meaningful application of environmental analysis tools; and
  • continuous learning and improvement.

The SDS states that the Agency will begin the research phase of its long-term plan, which includes specific targets, to ensure that it can achieve this broad goal. The goals and objectives of the SDS are supported by 14 specific commitments.

2. How do your key goals, objectives, and/or long-term targets help achieve your department's strategic outcomes? The vision and goal of the 2007-2009 SDS directly supports the Agency's identified strategic outcomes to build the framework for more integrated environmental assessment, assume a more active leadership role in federal environmental assessment and build capacity to deliver existing and new responsibilities by striving to acquire the knowledge needed to strengthen the role of environmental assessment in advancing sustainable development in Canada.
3. What were your targets for the reporting period? Of the 46 commitments identified in the previous 2004-2006 SDS, the Agency fulfilled 25 commitments. Several initiatives were put on hold or were no longer considered priority items for the Agency.

The 2007-2009 SDS is a new strategy for the Agency, introduced recently as of January 2007, and includes revised targets that differ from the previous 2004-2006 SDS. Specific targets that support long-term outcomes or objectives for the SDS include supporting research and development, and fostering open dialogue, with a view to advancing the science and practice of environmental assessment, and sharing these findings with our stakeholders. It includes learning by doing: putting theory into practice and taking on new roles and responsibilities. Most importantly, it is about increasing our knowledge of the outcomes influenced by our federal environmental assessment framework, so that within the opportunities that lie ahead, the Agency is positioned to provide sound and forward-looking advice to Parliament regarding the role of the Agency, and the future of the federal environmental assessment framework.

4. What is your progress to date? The 2007-2009 SDS Action Framework sets out to address the main challenges the Agency faces in leading an environmental assessment framework that supports Canadians achieving and maintaining sustainable development. Progress to date has not yet been measured as the strategy was only recently implemented, however the SDS will shortly undergo its first evaluation of progress using the Agency's Monitoring and Tracking System (MATS).
5. What adjustments have you made, if any? The need to make adjustments to the 2007-2009 SDS has not yet been identified. Should adjustments be required following the first evaluation of progress, these will be documented and reported in the next Departmental Performance Report.

 

Table 10: Financial Statements

Canadian Environmental Assessment Agency

Financial Statements

For the Year Ended March 31, 2007

(Unaudited)

 

Canadian Environmental Assessment Agency

Statement of Management Responsibility

Responsibility for the integrity and objectivity of the accompanying financial statements of the Canadian Environmental Assessment Agency for the year ended March 31, 2007 and all information contained in this report rests with the Agency's management. These financial statements have been prepared by management in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

Management is responsible for the integrity and objectivity of the information in these financial statements. Some of the information in the financial statements is based on management's best estimates and judgment and gives due consideration to materiality. To fulfil its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the Agency's financial transactions. Financial information submitted to the Public Accounts of Canada and included in the Agency's Departmental Performance Report is consistent with these financial statements.

Management maintains a system of financial management and internal control designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are in accordance with the Financial Administration Act, are executed in accordance with prescribed regulations, within Parliamentary authorities, and are properly recorded to maintain accountability of Government funds. Management also seeks to ensure the objectivity and integrity of data in its financial statements by careful selection, training and development of qualified staff, by organizational arrangements that provide appropriate divisions of responsibility, and by communication programs aimed at ensuring that regulations, policies, standards and managerial authorities are understood throughout the department.

The financial statements of the Agency have not been audited.


____________________ ____________________
Jean-Claude Bouchard Daniel Nadeau
President Acting Senior Financial Officer
Ottawa, Canada
August 10, 2007

 

Canadian Environmental Assessment Agency

Statement of Financial Position (Unaudited)

At March 31

(in dollars)


  2007 2006
 
ASSETS
Financial assets
  Accounts receivable and advances (Note 4) 1,685,469 1,036,663
 
Total financial assets 1,685,469 1,036,663
Non-financial assets
  Tangible capital assets (Note 5) 11,247 12,653
 
Total non-financial assets 11,247 12,653
TOTAL 1,696,716 1,049,316
 
 
Liabilities
  Accounts payable and accrued liabilities (Note 6) 2,838,598 2,984,157
  Vacation pay and compensatory leave 616,707 412,076
  Employee severance benefits (Note 7) 2,335,215 2,087,903
 
Total liabilities 5,790,520 5,484,136
 
Equity of Canada (4,093,804) (4,434,820)
 
TOTAL 1,696,716 1,049,316
 

Contingent liabilities (Note 8)

Contracted obligations (Note 9)

The accompanying notes and schedules form an integral part of these statements.

 

Canadian Environmental Assessment Agency

Statement of Operations (Unaudited)

For the Year Ended March 31

(in dollars)


  2007 2006
 
Transfer payments
  First Nations 814,192 549,916
  Non-profit organizations 729,694 398,530
  Other levels of government 195,500 245,500
  Industry 70,000 13,500
  Other countries and international organizations 5,000 5,000
  Individuals 407 5,000
 
Total transfer payments 1,814,793 1,217,446
 
Operating Expenses
  Salaries and employee benefits 14,763,557 13,794,906
  Professional and special services 6,191,270 6,191,397
  Rentals 2,418,018 1,901,967
  Travel and relocation 2,332,312 1,680,726
  Information 339,476 333,472
  Telecommunications 287,906 199,302
  Utilities, materials and supplies 188,832 171,864
  Furniture and equipment 142,478 413,335
  Postage 51,869 58,339
  Repairs and maintenance 11,330 9,649
  Other 6,258 3,659
  Amortization 1,406 1,406
 
Total operating expenses 26,734,712 24,760,022
 
Total Expenses 28,549,505 25,977,468
 
Revenues
  Environmental assessment and training services 7,230,419 5,343,257
  Miscellaneous revenues 345 207
 
Total Revenues 7,230,764 5,343,464
 
 
Net Cost of Operations 21,318,741 20,634,004
 

The accompanying notes and schedules form an integral part of these statements.

 

Canadian Environmental Assessment Agency

Statement of Cash Flow (Unaudited)

For the Year Ended March 31

(in dollars)


  2007 2006
 
Operating Activities
 Net cost of operations 21,318,741 20,634,004
 Non-cash items:
   Services provided without charge (Note 10) (3,179,502) (3,106,219)
   Amortization of tangible capital assets (Note 5) (1,406) (1,406)
 
 Variations in Statement of Financial Position:
   Increase (decrease) in accounts receivable and advances (Note 4) 648,806 982,218
   Decrease (increase) in liabilities (306,384) (828,556)
 
 
 Cash used by Operating Activities 18,480,255 17,680,041
 
Financing Activities
 
 Net cash provided by Government of Canada 18,480,255 17,680,041
 

The accompanying notes and schedules form an integral part of these statements.

 

Canadian Environmental Assessment Agency

Statement of Equity of Canada (Unaudited)

At March 31

(in dollars)


  2007 2006
 
Equity of Canada, beginning of year (4,434,820) (4,587,076)
 Net cost of operations (21,318,741) (20,634,004)
 Current year appropriations used (Note 3) 18,372,079 17,578,452
 Revenue not available for spending (924,311) (948,750)
 Change in net position in the Consolidated Revenue Fund (Note 3) 1,032,487 1,050,339
 Services received without charge (Note 10) 3,179,502 3,106,219
 
Equity of Canada, end of year (4,093,804) (4,434,820)
 

The accompanying notes and schedules form an integral part of these statements.

 

Canadian Environmental Assessment Agency

Notes to the Financial Statements (Unaudited)

For the Year Ended March 31, 2007

1. Authority and Objectives

The Canadian Environmental Assessment Agency was established in 1995 under the Canadian Environmental Assessment Act. The Agency is mandated to provide high-quality federal environmental assessments that promote sustainable development. The Agency achieves this objective by:

  (a) providing administrative and advisory support for environmental assessment review panels;

  (b) promoting uniformity and harmonization of environmental assessment activities across Canada at all levels of government;

  (c) providing opportunities for meaningful public participation in the federal environmental assessment process.

The Agency has one core program activity which is "effective and efficient environmental assessment" which serves as the basis for its mission. This core program activity is supported by Corporate Services which provides modern, timely and responsive services.

In addition, the Agency has obligations under the Canada-Wide Accord on Environmental Harmonization and bilateral agreements with the provincial governments as well as international agreements covering environmental assessments.

The Agency is listed in Schedule I.1 of the Financial Administration Act and reports to Parliament through the Minister of the Environment.

2. Summary of Significant Accounting Policies

The financial statements have been prepared in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector

  (a) Parliamentary appropriations - The Canadian Environmental Assessment Agency is primarily financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the Agency do not parallel financial reporting according to generally accepted accounting principles since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the statement of operations and the statement of financial position are not necessarily the same as those provided through appropriations from Parliament. Note 3 provides a high level reconciliation between the bases of reporting.

  (b) Net Cash Provided by Government - The Agency operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the Agency is deposited to the CRF and all cash disbursements made by the Agency are paid from the CRF. The net cash provided by Government is the difference between all cash receipts and all cash disbursements including transactions between the Agency and other federal government departments.

  (c) Change in net position in the Consolidated Revenue Fund is the difference between the net cash provided by Government and appropriations used in a year, excluding the amount of non-respendable revenue recorded by the Agency. It results from timing differences between when a transaction affects appropriations and when it is processed through the CRF.

  (d) Revenues:

  • Revenues from regulatory fees are recognized in the accounts based on the services provided in the year.
  • Revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.

  (e) Expenses - Expenses are recorded on an accrual basis:

  • Contributions are recognized in the year in which the recipient has met the eligibility criteria or fulfilled the terms of a contractual transfer agreement.
  • Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
  • Services provided without charge by other government departments are recorded as operating expenses at their estimated cost.

  (f) Employee future benefits

  • Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multiemployer plan administered by the Government of Canada. The Agency's contributions to the Plan are charged to expenses in the year incurred and represent the total Agency obligation to the Plan. Current legislation does not require the Agency to make contributions for any actuarial deficiencies of the Plan.
  • Severance benefits: Employees are entitled to severance benefits under labour contracts or conditions of employment. These benefits are accrued as employees render the services necessary to earn them. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.

  (g) Accounts receivables are stated at amounts expected to be ultimately realized; a provision is made for receivables where recovery is considered uncertain.

  (h) Contingent liabilities - Contingent liabilities are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. To the extent that 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.

  (i) Foreign currency transactions - Transactions involving foreign currencies are translated into Canadian dollar equivalents using rates of exchange in effect at the time of those transactions. Monetary assets and liabilities denominated in foreign currencies are translated into Canadian dollars using the rate of exchange in effect on March 31.

  (j) Tangible capital assets - All tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the capital asset as follows:


Asset class Sub-asset class Amortization period
Machinery and equipment Furniture and fixtures 10 years

  (k) Measurement uncertainty - The preparation of financial statements in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector requires management to make estimates and assumptions that could affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these financial statements, management believes the estimates and assumptions to be reasonable. The most significant estimated items are employee severance benefits, allowances for employee vacation and compensatory benefits and the useful life of tangible capital assets. Actual results could significantly differ from those estimated. Management's estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

3. Parliamentary Appropriations

The Agency receives most of its funding through annual Parliamentary appropriations. Items recognized in the statement of operations and the statement of financial position in one year may be funded through Parliamentary appropriations in prior, current or future years. Accordingly, the Agency has different net results of operations for the year on a government funding basis than on an accrual accounting basis. The differences are reconciled in the following tables:

 

  a) Reconciliation of net cost of operations to current year appropriations used:


  2007 2006
 
  (in dollars)
Net cost of operations 21,318,741 20,634,004
Adjustments for items affecting net cost of operations
but not affecting appropriations
 
Add (Less):
  Services provided without charge (Note 10) (3,179,502) (3,106,219)
  Amortization of tangible capital assets (Note 5) (1,406) (1,406)
  Revenue not available for spending 924,311 948,750
  Vacation pay and compensatory leave (154,663) (248,096)
  Legal expenses charged by Justice Canada (535,402) (655,841)
  Other 0 7,260
 
Current year appropriations used 18,372,079 17,578,452
 

 

  (b) Appropriations provided and used


  Appropriations Provided
  2007 2006
 
  (in dollars)
Vote 20 - Program expenditures 17,614,665 17,466,946
Statutory amounts 1,909,930 1,991,890
Less:
  Lapsed appropriations (1,152,516) (1,880,384)
 
Current year appropriations used 18,372,079 17,578,452
 

 

  (c) Reconciliation of net cash provided by Government to current year appropriations used


  2007 2006
 
  (in dollars)
Net cash provided by Government 18,480,255 17,680,041
Revenue not available for spending 924,311 948,750
Change in net position in the Consolidated Revenue Fund
  Variation in accounts receivable and advances (648,806) (982,218)
  Variation in accounts payable and accrued liabilities (145,559) 679,771
  Variation in employee severance benefits 247,312 0
  Legal expenses charged by Justice Canada (535,402) (655,841)
  Other adjustments 49,968 (92,051)
 
  (1,032,487) (1,050,339)
 
 
Current year appropriations used 18,372,079 17,578,452
 

 

4. Accounts Receivable and Advances

The following table presents details of accounts receivable and advances:


  2007 2006
 
  (in dollars)
Receivables from other Federal Government departments and agencies 39,482 81,497
Receivables from external parties 1,643,187 952,366
Employee advances 2,800 2,800
 
 
Total 1,685,469 1,036,663
 

 

5. Tangible Capital Assets

(in dollars)


Cost Accumulated amortization    
Capital asset class Opening balance Acquisitions Disposals and write-offs Closing balance Opening balance Amortization Disposals and write-offs Closing balance 2007 Net book value 2006 Net book value
Machinery and equipment 14,059 - - 14,059 1,406 1,406 - 2,812 11,247 12,653
Total 14,059 - - 14,059 1,406 1,406 - 2,812 11,247 12,653

Amortization estimated expense for the year ended March 31, 2007 is $1,406 (2006 - $1,406).

 

6. Accounts Payable and Accrued Liabilities

The following table presents details of accounts payable and accrued liabilities:


  2007 2006
 
  (in dollars)
Payables to other Federal Government departments and agencies 341,249 352,181
Payables to external parties 2,003,023 2,259,583
Accrued salaries 494,326 372,393
 
 
Total 2,838,598 2,984,157
 

7. Employee Benefits

  (a) Pension benefits: The Agency's employees participate in the Public Service Pension Plan, which is sponsored and administered by the Government of Canada. Pension benefits accrue up to a maximum period of 35 years at a rate of 2 percent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Qubec Pension Plans benefits and they are indexed to inflation.

Both the employees and the Agency contribute to the cost of the Plan. The 2006-07 expense amounts to $1,407,619 ($1,473,276 in 2005-06), which represents approximately 2.2 times (2.6 in 2005-06) the contributions by employees.

The Agency's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the financial statements of the Government of Canada, as the Plan's sponsor.

  (b) Severance benefits: The Agency provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information about the severance benefits, measured as at March 31, is as follows:


  2007 2006
 
  (in dollars)
Accrued benefit obligation, beginning of year 2,087,903 1,767,148
Expense for the year 364,768 399,576
Benefits paid during the year (117,456) (78,821)
 
 
Accrued benefit obligation, end of year 2,335,215 2,087,903
 

8. Contingent Liabilities - Claims and Litigation

In the normal course of its operations, the Agency becomes involved in various legal actions. Some of these potential liabilities may become actual liabilities when one or more future events occur or fail to occur. To the extent that 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 on the Government's consolidated financial statements. These estimated liabilities are not recognized on the Agency's financial statement as a liability until the amount of the liability is firmly established. At March 31, 2007, no actual liabilities exist and insufficient information is available to determine if any of the potential liabilities will become actual liabilities.

9. Contractual Obligations

The nature of the Agency's activities can result in some multi-year contracts and obligations whereby the Agency will be obligated to make future payments when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:


(in dollars) 2008 2009 2010 2011 2012 Total

Transfer payments 514,220 - - - - 514,220
Professional services 333,603 42,538 27,987 12,300 - 416,428
Operating leases 166,645 73,298 7,474 7,474 7,474 262,365
 
 
Total 1,014,468 115,836 35,461 19,774 7,474 1,193,013
 

10. Related Party Transactions

The Agency is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. The Agency enters into transactions with these entities in the normal course of business and on normal trade terms. Also, during the year, the Agency received services which were obtained without charge from other Government departments as presented below.

During the year the Agency received without charge from other departments, accommodation, legal fees and employer's contribution to the health and dental insurance plans. These services without charge have been recognized in the Agency's Statement of Operations as follows:


  2007 2006
 
  (in dollars)
Accommodation 1,554,311 1,539,563
Employer's contribution to the health and dental insurance plans 824,373 802,296
Legal services provided by the Department of Justice 800,818 764,360
 
 
Total 3,179,502 3,106,219
 

The Agency also obtains selected financial services, materiel management, informatics and compensation and benefits services under a shared services agreement with Environment Canada. A portion of the cost of these services is paid annually and is reflected in the net cost of the program while a further portion is non-reimbursing and represents the commitment to shared services which was made at the time of the Agency's creation.

In addition, the Government has structured some of its administrative activities for efficiency and cost-effectiveness purposes so that one department performs these on behalf of all without charge. The costs of these services, which include payroll and cheque issuance services provided by Public Works and Government Services Canada and audit services provided by the Office of the Auditor General, are not included as an expense in the Agency's Statement of Operations.