Crown Indigenous Relations and Northern Affairs – Future-Oriented Statements of Operations for the Year Ending March 31, 2019

Consult: Indigenous Services Canada – Future-Oriented Statements of Operations for the Year Ending March 31, 2019

Table of contents

Crown Indigenous Relations and Northern Affairs
Future-Oriented Statement of Operations (Unaudited)
For the Year Ended March 31

(in thousands of dollars) Forecast Results
2017-18
Planned Results
2018-19
Expenses
Rights and Self-Determination
6,641,706 4,035,869
Community and Regional Development
743,830 438,432
Internal Services
324,329 220,927
Unallocated
3,946,714 0
Expenses incurred on behalf of Government
(4,148) (4,144)
Total expenses 11,652,431 4,691,084
Revenues
Finance and administrative services
2,539 2,432
Leases and rentals
1,249 1,191
Interest on loans
1,352 943
Resource royalties
747 743
Miscellaneous
3,684 3,903
Revenues earned on behalf of Government
(6,091) (5,569)
Total revenues 3,480 3,643
Net cost of operations before government funding and transfers 11,648,951 4,687,441
  • The accompanying notes form an integral part of the Future-Oriented Statement of Operations.

Crown Indigenous Relations and Northern Affairs
Notes to the Future-Oriented Statement of Operations (Unaudited)
For the Year Ended March 31

1. Methodology and Significant Assumptions

The Future-Oriented Statement of Operations has been prepared on the basis of the government priorities and departmental plans as described in the Departmental Plan.

The information in the forecasted results for fiscal year 2017-18 is based on actual results as at October 31, 2017 and forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for fiscal year 2018-19.

The main assumptions underlying the forecasts are as follows:

  1. the department's activities will remain substantially the same as the previous year;
  2. expenses and revenues, including the determination of amounts internal and external to the government, are based on past experience. The general historical pattern is expected to continue;
  3. the forecasts take in consideration the transfer of two programs at Indigenous Services Canada from November 30, 2017;
  4. accruals for new environmental liabilities cannot be reasonably foreseen or quantified and have therefore been excluded from the forecast;
  5. allowances for uncollectibles are based on historical experience.

These assumptions are adopted as of December 31, 2017.

2. Variations and changes to the forecast financial information

Although every attempt has been made to forecast final results for the remainder of 2017-18 and for 2018-19, actual results achieved for both years are likely to differ from the forecast information presented, and this variation could be material.

In preparing this Future-Oriented Statement of Operations, the department has made estimates and assumptions about the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are based on past experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances, and are continually evaluated.

Factors that could lead to material differences between the Future-Oriented Statement of Operations and the historical statement of operations include:

  1. the timing and the amount of acquisitions and disposals of property, plants and equipment, which may affect gains, losses and amortization expense;
  2. the implementation of new collective agreements;
  3. economic conditions, which may affect both the amount of revenue earned and the collectability of loan receivables;
  4. interest rates in effect at the time of issue, which will affect the net present value of non-interest-bearing loans; and
  5. other changes to the operating budget, such as new initiatives or technical adjustments later in the fiscal year.

After the Department Plan is tabled in Parliament, the department will not be updating the forecasts for any changes in financial resources made in ensuing supplementary estimates. Variances will be explained in the Departmental Results Report.

3. Summary of significant accounting policies

The Future-Oriented Statement of Operations has been prepared using the Government of Canada's accounting policies in effect for the fiscal year 2017-2018, and is based on Canadian public sector accounting standards. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian public sector accounting standards.

Significant accounting policies are as follows:

  1. Expenses

    The department records expenses on an accrual basis.

    Transfer payments are recorded as expenses in the year the transfer is authorized and all eligibility criteria have been met by the recipient.

    Other expenses are generally recorded when goods are received or services are rendered and include expenses related to personnel, professional and special services, repair and maintenance, utilities, materials and supplies, as well as amortization of tangible capital assets. Provisions to reflect changes in the value of assets or liabilities, such as provisions for bad debts, loans, investments and advances, as well as utilization of prepaid expenses, and other are also included in other expenses.
  2. Revenues

    Revenues from regulatory fees are recognized in the accounts based on the services provided in the fiscal year.

    Other revenues are accounted for in the period in which the underlying transaction or event that gave rise to the revenue takes place.

    Revenues that are non-respendable are not available to discharge department's liabilities. Although, the deputy head is expected to maintain accounting control, he or she has no authority the disposition of non-respendable revenues. As a result, non-respendable revenues are considered to be earned on behalf of the Government of Canada and are therefore presented as a reduction of the department's gross revenues.

4. Parliamentary authorities

The department is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to the department differs from financial reporting according to generally accepted accounting principles because authorities are based mainly on cash flow requirements. Items recognized in the Future-Oriented Statement of Operations in one year may be funded through parliamentary authorities in prior, current, or future years. Accordingly, the department has different net cost 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 authorities requested (in thousands of dollars)
  Forecast Results
2017-18
Planned Results
2018-19
Net cost of operations before government funding and transfers 11,648,951 4,687,441
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets
(7,643) (6,242)
Gain on disposal of tangible capital assets
941 1,211
Services provided without charge by other government departments
(71,133) (45,955)
Bad debt expense (not incurred on behalf of government)
(1,466) (1,184)
Increase in provision for claims and litigation
(4,908,811) (2,247,056)
Increase in liability for settled claims
(2,019) 0
Increase in environmental liabilities
(111,639) (67,578)
Decrease (increase) in employee future benefits
(1,962) 1,469
Increase in vacation pay and compensatory leave
(1,188) (1,522)
Transfer of land held for future claim settlements
(268) (268)
Decrease in finance and administrative services
159 432
Refunds/adjustments of previous years’ expenditures
39,242 16,042
Total items affecting net cost of operations but not affecting authorities (5,065,787) (2,350,651)
Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisition of tangible capital assets
45,119 15,091
Acquisition of land held for future claims settlements
1,785 0
Expenditures related to settled claims
62,089 65,959
Expenditures related to claims and litigation
1,447,627 392,521
Expenditures reducing environmental liabilities
227,087 273,844
Total items not affecting net cost of operations but affecting authorities 1,783,707 747,415
Requested authorities 8,366,871 3,084,205
b. Authorities requested (in thousands of dollars)
  Forecast Results
2017-18
Planned Results
2018-19
Authorities requested:
Vote 1 – Operating expenditures 854,847 613,212
Vote 5 – Capital expenditures 45,119 15,091
Vote 7 – Debt forgiveness 527 0
Vote 9 – Debt write-off 100 0
Vote 10 – Grants and contributions 7,300,757 2,359,855
Statutory amounts 165,521 96,047
Total authorities requested 8,366,871 3,084,205

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