Indigenous Services Canada: Future-Oriented Statements of Operations for the Year Ended March 31, 2020

Consult: Crown Indigenous Relations and Northern Affairs : Future-Oriented Statements of Operations for the Year Ending March 31, 2020

Table of contents

Indigenous Services Canada:
Future-Oriented Statement of Operations (Unaudited)
For the Year Ended March 31

(in thousands of dollars) Forecast results
2018-2019
Planned results
2019-2020
Expenses
Health and Social Service
6,143,477 4,488,260
Governance and Community Development
3,073,257 2,545,051
Service and Benefits to Individuals
1,986,991 2,146,320
Indigenous Self-determined Service
493,325 2,350,530
Internal Services
162,755 140,444
Expenses incurred on behalf of Government
(23) (24)
Total expenses 11,859,782 11,670,581
Revenues
Respendable Revenue
159,703 169,762
Finance and administrative services
19,417 19,417
Interest on loans
91 91
Miscellaneous
159 152
Revenues earned on behalf of Government
(186) (196)
Total revenues 179,184 189,226
Net cost of operations before government funding and transfers 11,680,598 11,481,355
  • The accompanying notes form an integral part of the Future-Oriented Statement of Operations.

Indigenous Services Canada:
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 2018-19 is based on actual results as at December 31, 2018 and forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for fiscal year 2019-20.

The main assumptions underlying the forecasts are as follows:

  1. 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; and
  2. Allowances for uncollectibles are based on historical experience.

These assumptions are adopted as of December 31, 2018.

2. Variations and changes to the forecast financial information

Although every attempt has been made to forecast final results for the remainder of 2018-19 and for 2019-20, 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, Indigenous Service Canada (ISC) 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, ISC 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 2018-2019, 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

    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.

    Funds received from external parties for specified purposes are recorded upon receipt as deferred revenue. These revenues are recognized in the period in which the related expenses are incurred.

    Deferred revenue consists of amounts received in advance of the delivery of goods and rendering of services that will be recognized as revenue in a subsequent fiscal year as it is earned.

    Other revenues are recognized in the period the event giving rise to the revenues occurred.

    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 over 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
2018-2019
Planned Results
2019-2020
Net cost of operations before government funding and transfers 11,680,598 11,481,355
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets
(6,126) (6,035)
Gain on disposal of tangible capital assets
223 257
Services provided without charge by other government departments
(55,321) (57,078)
Bad debt expense (not incurred on behalf of government)
(2,122) (1,624)
Decrease in accrued liabilities
34,571 57,209
Increase in provision for claims and litigation
(1,660) 0
Increase in employee future benefits
(1,189) (910)
Increase in vacation pay and compensatory leave
(606) (2,160)
Others
7,617 18,674
Refunds/adjustments of previous years' expenditures
32,938 32,938
Total items affecting net cost of operations but not affecting authorities 8,325

41,271

Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisition of tangible capital assets
8,563 5,618
Expenditures related to claims and litigation
33,835 50,373
Total items not affecting net cost of operations but affecting authorities 42,398 55,991
Requested authorities 11,731,321 11,578,617
b. Authorities requested (in thousands of dollars)
  Forecast Results
2018-2019
Planned Results
2019-2020
Authorities requested:
Vote 1: Operating expenditures 1,891,654 1,954,110
Vote 5: Capital expenditures 8,563 5,618
Vote 10: Grants and contributions 9,737,806 9,496,194
Statutory amounts 93,298 122,695
Total authorities requested 11,731,321 11,578,617

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