ARCHIVED - Financial Statements (unaudited) 2009-2010

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Statement of Management Responsibility

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2010, and all information contained in these statements rests with the management of the Commission for Public Complaints Against the RCMP (CPC). These financial statements have been prepared by management in accordance with Treasury Board accounting policies which are based on 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 fulfill its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the CPC's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada and included in the CPC's Departmental Performance Report is consistent with these financial statements.

Management is also responsible for maintaining an effective system of internal controls over financial reporting designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are properly authorized and recorded in accordance with the Financial Administration Act and other applicable legislation, regulations, authorities and policies.

Management seeks to ensure the objectivity and integrity of data in its financial statements through careful selection, training and development of qualified staff; through organizational arrangements that provide appropriate divisions of responsibility; and through communication programs aimed at ensuring that regulations, policies, standards and managerial authorities are understood throughout the CPC.

The financial statements of the CPC have not been audited.

Originally signed by:

_____________________
Ian McPhail, Q.C.
Interim Chair

_____________________
Helen Banulescu
Chief Financial Officer

Statement of Financial Position (unaudited)

Assets March 31 (in dollars)
Financial Assets 2010 2009
Due from Consolidated Revenue Fund $ 124,855 $ 609,709
Accounts receivable and advances (Note 4) 12,919 51,155
Total Financial Assets 137,774 660 864
Assets March 31 (in dollars)
Non-financial assets 2010 2009
Tangible capital assets (Note 8) 195,681 81,711
Total Asset $ 333,455 $ 742,575
Liabilities and Equity of Canada March 31 (in dollars)
Liabilities 2010 2009
Accounts payable and accrued liabilities (note 5) $ 124,555 $ 654,072
Vacation pay and compensatory leave 154,337 213,336
Employee future benefits (Note 6) 632,830 707,296
Total Liabilities 911,722 1,574,704
Liabilities and Equity of Canada March 31 (in dollars)
Equity of Canada 2010 2009
Equity of Canada (578,267) (832,129)
Total Liabilities and Equity of Canada $ 333,455 $ 742,575

The accompanying notes form an integral part of these financial statements

Statement of Operations (unaudited)

Statement of Operations For the Year Ended March 31 (in dollars)
Expenses 2010 2009
Civilian Review of RCMP members' conduct $ 3,421,877 $ 3,951,375
Internal Services 4,558,548 5,261,437
Total Expenses 7,980,425 9,212,812
Statement of Operations For the Year Ended March 31 (in dollars)
Revenues 2010 2009
Civilian Review of RCMP members' conduct $ 50 $ 20
Internal Services 11,735 3,992
Total Revenues 11,785 4,012
Net Cost of Operations $ 7,968,640 $ 9,208,800

Segmented information (Note 9)

The accompanying notes form an integral part of these financial statements

Statement of Equity of Canada (unaudited)

Statement of Equity of Canada For the Year Ended March 31 (in dollars)
  2010 2009
Restated (Note 10)
Equity of Canada, beginning of year $ (832,129) $ (739,841)
Net cost of operations (7,968,640) (9,208,800)
Net cash provided by Government of Canada 7,925,952 7,951,352
Change in due from the Consolidated Revenue Fund) (484,854) 363,661
Services provided without charge by other government departments (Note 7) (781,405) 801,499
Equity of Canada, end of year $ (578,267) $ (832,129)

Totals may not add due to rounding

The accompanying notes form an integral part of these financial statements

Statement of Cash Flow (unaudited)

Operating activities For the Year Ended March 31 (in dollars)
  2010 2009
Restated (Note 10)
Net Cost of Operations $ 7,968,640 $ 9,208,800
Operating activities For the Year Ended March 31 (in dollars)
Non-cash items: 2010 2009
Restated (Note 10)
Services received without charge from other government departments (Note 7) (781,405) (801,499)
Amortization of tangible capitale assets (Note 8) (35,703) (26,500)
Operating activities For the Year Ended March 31 (in dollars)
Variations in Statement of Financial Position: 2010 2009
Restated (Note 10)
(Decrease) increase in accounts receivable and advances (38,236) (37,271)
(Increase) decrease in accounts payable and accrued liabilities 529,517 (327,927)
Decrease (increase) in vacation pay and compensatory leave 58,999 -
(Increase) decrease in employee future benefits (Note 6) 74,466 (119,461)
Cash used by operating activities 7,776,278 7,896,142
Capital investment activities For the Year Ended March 31 (in dollars)
Capital investment activities 2010 2009
Restated (Note 10)
Acquisitions of tangible capital assets (Note8) 149,673 55,210
Net cash provided by Government of Canada $ (7,925,952) $ (7,951,352)

Totals may not add due to rounding

The accompanying notes form an integral part of these financial statements


Notes to the Financial Statements (unaudited)

For the Year Ended March 31, 2010

1. Authority and purpose

The Commission for Public Complaints Against the RCMP (CPC) is a federal agency reporting to Parliament that receives and reviews public complaints about the conduct of members of the RCMP in the performance of any duty or function under the Royal Canadian Mounted Police Act. The Commission is entirely separate from and independent of the RCMP. The mandate of the Commission is set out in Part VII of the Royal Canadian Mounted Police Act and can be summarized as follows:

  • To receive complaints from the public about the conduct of RCMP members;
  • To initiate complaints to delve into RCMP conduct when it is in the public interest to do so;
  • To conduct reviews when complainants are not satisfied with the RCMP's disposition of their complaints;
  • To hold hearings and conduct investigations; and
  • To report findings and recommendations.

Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization.

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. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian generally accepted accounting principles.

Significant accounting policies are as follows:

(a) Parliamentary authorities

The Commission is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to the CPC does not parallel financial reporting according to generally accepted accounting principles since authorities 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 authorities from Parliament. Note 3 provides a reconciliation between the bases of reporting.

(b) Net Cash Provided by Government

The Commission operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the Commission is deposited to the CRF and all cash disbursements made by the Commission 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 departments of the Government.

(c) Amount due from/to CRF

Amounts due from/to the CRF are the result of timing differences at year-end between when a transaction affects authorities and when it is processed through the CRF. Amounts due from the CRF represent the net amount of cash that the Commission is entitled to draw from the CRF without further appropriations to discharge its liabilities.

(d) Revenues

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

Funds that have been received are recorded as deferred revenue, provided the Commission has an obligation to other parties for the provision of goods, services or the use of assets in the future.

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

(e) Expenses

Expenses are recorded on the accrual basis:

  • Vacation pay and compensatory leave are accrued as the benefits are earned by employees under their respective terms of employment.
  • Services provided without charge by other government departments for accommodation and the employer contributions to the health and dental insurance plans 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 pension plan administered by the Government of Canada. The Commission's contributions to the Plan are charged to expenses in the year incurred and represent the Commission's total obligation to the Plan. Current legislation does not require the Commission 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 Receivable and Advances

Accounts receivable and advances are stated at the lower of cost and net recoverable value; a valuation allowance is recorded for receivables where recovery is considered uncertain.

(h) 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. The Commission does not capitalize intangibles, works of art and historical treasures that have cultural, aesthetic or historical value, or assets located on Indian reserves and museum collections.

Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset as follows :

Asset Class
Other equipment including furniture
Computer hardware
Computer software
Leasehold improvements
Amortization Period
5 years
4 years
3-5 years
Lesser of the remaining term of the lease or useful life of the improvement

Assets under construction are recorded in the applicable capital asset class in the year that they become available for use and are not amortized until they become available for use.

(i) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. The most significant items where estimates are used are the liability for employee future 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 authorities

The Commission receives most of its funding through annual Parliamentary authorities. Items recognized in the statement of operations and the statement of financial position in one year may be funded through Parliamentary authorities in prior, current or future years. Accordingly, the Commission 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 authorities used:

Reconciliation of net cost of operations to current year authorities used (in dollars)
  2010 2009
Net cost of operations $ 7,968,640 $ 9,208,800
Reconciliation of net cost of operations to current year authorities used (in dollars)
Adjustments for items affecting net cost of operations but not affecting authorities: 2010 2009
Services provided without charge by other government departments (Note 7) (781,405) (801,499)
Refund of prior years' expenditures 3,263 1,300
Adjustments of accounts payable at year end 99,783 19,883
Decrease (Increase) in Employee future benefits 74,466 (119,461)
Decrease in vacation pay and compensatory leave 58,999 -
Revenue not available for spending 11,785 4,012
Amortization of tangible capital assets (35,703) (26,500)
  (568,812) (922,265)
Reconciliation of net cost of operations to current year authorities used (in dollars)
Adjustments for items not affecting net cost of operations but affecting authorities: 2010 2009
Acquisition of tangible capital assets 149,673 55,210
Current year authorities used $ 7,549,501 $ 8,341,745

(b) Authorities provided and used:

Authorities provided and used (in dollars)
Authorities Provided: 2010 2009
Program expenditures – Vote 70 $ 7,965,414 $ 8,481,026
Less:
Lapsed: Operating
1,017,689 916,442
  6,947,725 7,564,584
Contributions to employee benefits plan 601,776 777,161
Current year authorities used $ 7,549,501 $ 8,341,745

4. Accounts receivable and advances

The following table presents details of the Commission's accounts receivable and advances:

The Commission's accounts receivable and advances (in dollars)
  2010 2009
Receivables from other government departments and agencies $ 12,119 50,355
Employee advances 800 800
Total $ 12,919 51,155

5. Accounts payable and accrued liabilities

The following table presents details of the Commission's accounts payable and accrued liabilities:

The Commission's accounts payable and accrued liabilities (in dollars)
  2010 2009
Accounts payable to other government departments and agencies $ 102,517 $ 174,927
Accounts payable to external parties 22,039 351,448
Accrued liabilities - 127,697
Total $ 124,555 $ 654,072

6. Employee future benefits

(a) Pension benefits

The Commission'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/Quebec Pension Plans benefits and they are indexed to inflation.

Both the employees and the Commission contribute to the cost of the Plan. The 2009-2010 expense amounts to $434,483 ($561,110 in 2008-2009), which represents approximately 1.9 times (2.0 in 2008-2009) the contributions by employees.

The Commission'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 Commission 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 authorities. Information about the severance benefits, measured as at March 31, is as follows:

Severance benefits, measured as at March 31 (in dollars)
  2010 2009
Accrued benefit obligation, beginning of year $ 707,296 $ 587,835
Expense or adjustment for the year (74,061) 154,131
Benefits paid during the year (405) (34,670)
Accrued benefit obligation, end of year $ 632,830 $ 707,296

7. Related party transactions

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

(a) Common services provided without charge by other government departments

During the year the Commission received common services without charge from certain common service organizations related to accommodation and the employer's contribution to the health and dental insurance plans. These services provided without charge have been recorded in the Commission's Statement of Operations as follows:

Commission's Statement of Operations (in dollars)
  2010 2009
Accommodation $ 563,844 $ 591,307
Employer contributions to the health and dental insurance plans 217,561 210,192
  $ 781,405 $ 801,499

The Government has centralized some of its administrative activities for efficiency and cost-effectiveness purposes and economic delivery of programs to the public. As a result, the Government uses central agencies and common services organization so that one department performs services for all other departments and agencies without charge. The costs of these services, such as 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 in the Commission's Statement of Operations.

b) Other transactions with related parties

Other transactions with related parties (in dollars)
  2010 2009
Expenses – Other government departments and agencies $ 455,095 $ 316,451

8. Tangible capital assets

Cost (in dollars)
Capital asset class Opening
balance
1/04/2009
Acquisitions Disposals &
write-offs
Closing
balance
31/03/2010
Computer hardware 32,174 34,183   66,357
Computer software 0 15,569   15,569
Other equipment including furniture 23,036 99,921   122,957
Leasehold improvements 79,501     79,501
Total $ 134,711 $ 149,673   $ 284,384
Accumulated Amortization (in dollars)
Capital asset class Opening
balance
1/04/2010
Amortization Disposals &
write-offs
Closing
balance
31/03/2010
Computer hardware   4,596   4,596
Computer software        
Other equipment including furniture   4,607   4,607
Leasehold improvements 53,000 26,500   79,500
Total $ 53,000 $ 35,703   $ 88,703

Amortization expenses for the year ended March 31, 2010 is $35,703 ($26,500 for the year ended March 31, 2009).

9. Segmented Information

Presentation by segment is based on the Commission's program activity architecture. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in note 2. The following table presents the expenses incurred and revenues generated for the main program activities, by major object of expenses and by major type of revenues. The segment results for the period are as follows:

Expenses incurred and revenues generated for the main program activities For the Year Ended March 31 (in dollars)
Expenses Civilian Review
2010
Internal Services
2010
Total
2010
Total
2009
Salaries and employee benefits $ 2,478,781 $ 2,376,237 $ 4,855,018 $ 5,594,073
Professional and special services 459,512 1,382,997 1,842,509 1,939,541
Accommodation 308,659 262,920 571,579 616,818
Travel and relocation 99,731 52,874 152,605 170,320
Equipment 12,254 110,514 122,768 252,847
Utilities, material and supplies 10,327 101,616 111,943 133,840
Communication 22,306 73,986 96,292 147,445
Equipment rentals 10,198 83,603 93,801 64,204
Information 20,109 50,711 70,820 165,520
Amortization - 35,703 26,500  
Repairs - 27,387 27,387 101,704
Total Expenses 3,421,877 4,558,548 7,980,425  
Expenses incurred and revenues generated for the main program activities For the Year Ended March 31 (in dollars)
Revenues Civilian Review
2010
Internal Services
2010
Total
2010
Total
2009
Other revenues 50 11,735 11,785 4,012
Expenses incurred and revenues generated for the main program activities For the Year Ended March 31 (in dollars)
Net Cost of Operations Civilian Review
2010
Internal Services
2010
Total
2010
Total
2009
Net Cost of Operations $ 3,421,827 $ 4,546,813 $ 7,968,640 $ 9,208,800

10. Adoption of new accounting policies

During the year, the Commission adopted the revised Treasury Board accounting policy TBAS 1.2: Departmental and Agency Financial Statements which is effective for the Commission for the 2009-2010 fiscal year. The major change in the accounting policies of the Commission required by the adoption of the revised TBAS 1.2 is the recording of amounts due from the Consolidated Revenue Fund as an asset on the Statement of Financial Position.

The adoption of the new Treasury Board accounting policies have been accounted for retroactively with the following impact on comparatives for 2008-2009:

The adoption of the new Treasury Board accounting policies have been accounted for retroactively with the following impact on comparatives for 2008-2009 (in dollars)
Statement of Financial Position 2009
As previously stated
2009
Effect of changes
2009
Restated
Assets $ 132,866 $ 609,709 $ 742,575
Equity of Canada $ (1,441,838) $ 609,709 $ (832,129)

11. Comparative information

Comparative figures have been reclassified to conform to the current year's presentation.

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