Future-Oriented Financial Statements for the Years Ending March 31, 2013 and March 31, 2014

Statement of Management Responsibility

The Management of the Commission for Public Complaints Against the RCMP (CPC) is responsible for these future-oriented financial statements, including responsibility for the appropriateness of the assumptions on which these statements are prepared. These statements are based on the best information available and assumptions adopted as at January 9, 2013, and reflect the plans described in the Report on Plans and Priorities.

These future-oriented financial statements have been prepared in accordance with the Treasury Board's accounting policies and its Guide on the preparation of general purpose future-oriented financial statements.

These future-oriented financial statements have not been audited.

Originally signed by:

Helen Banulescu
Chief Financial Officer
Ottawa, Canada
Ian McPhail, Q.C.
Interim Chair
Ottawa, Canada

Future-Oriented Statement of Financial Position (unaudited)

As at March 31
(in dollars)
  Expected Results
2013
Forecast
2014
Liabilities
Accounts payable and accrued liabilities (note 7) $239,812 $265,881
Vacation pay and compensatory leave 196,024 186,919
Employee future benefits (note 8) 340,000 295,000
Total net liabilities $775,836 $747,800
Financial assets
Due from Consolidated Revenue Fund $238,579 $264,604
Accounts receivable and advances (note 6) 39,710 48,640
Total financial assets $278,289 $313,244
Departmental net debt $497,547 $434,556
Non-Financial assets
Tangible capital assets 679,896 684,824
Total non-financial assets $679,896 $684,824
Departmental net financial position $182,349 $250,268

The accompanying notes form an integral part of these future-oriented financial statements.

Originally signed by:

Helen Banulescu
Chief Financial Officer
Ottawa, Canada
Ian McPhail, Q.C.
Interim Chair
Ottawa, Canada

Future-Oriented Statements of Operations and Departmental Net Financial Position (unaudited)

For the Year Ended March 31
(in dollars)
  Expected Results
2013
Forecast
2014
Expenses
Civilian review of RCMP members' conduct $4,055,819 $2,667,078
Internal services 5,539,159 3,809,571
Total expenses $9,594,978 $6,476,649
Revenues
Respendable revenue - -
Miscellaneous revenue 5,892 5,500
Revenues earned on behalf of government (5,892) (5,500)
Total revenues - -
Net cost of operations before government funding and transfers $9,594,978 $6,476,649
Government Funding and Transfers
Net cash provided by government 8,456,310 5,408,543
Change in due from the Consolidated Revenue Fund (14,881) 26,025
Services provided without charge by other government departments (note 9) 1,110,000 1,110,000
Net cost of operations after government funding and transfers $43,549 $(67,919)
Departmental net financial position – beginning of year $225,898 $182,349
Departmental net financial position – end of year $182,349 $250,268

Segmented information (Note 11)

The accompanying notes form an integral part of these future-oriented financial statements.

Future-Oriented Statement of Change in Departmental Net Debt (unaudited)

For the Year Ended March 31
(in dollars)
  Estimated Results
2013
Forecast
2014
Net cost of operations after government funding and transfers $43,549 $(67,919)
Change due to tangible capital assets
Acquisition of tangible capital assets (note 10) 160,000 220,000
Amortization of tangible capital assets (note 10) (183,305) (215,072)
Total change due to tangible capital assets $343,305 $435,072
Net increase in departmental net debt due to operations $20,244 $(62,991)
Departmental net debt – beginning of year $477,303 $497,547
Departmental net debt – end of year $497,547 $434,556

The accompanying notes form an integral part of these future-oriented financial statements.

Future-Oriented Statement of Cash Flows (unaudited)

Future-Oriented Statement of Cash Flows For the Year Ended March 31
(in dollars)
  Estimated Results
2013
Forecast
2014
Operating Activities
Net cost of operations before government funding and transfers $9,594,978 $6,476,649
Non-cash items:
Amortization of tangible capital assets (Note 8) (183,305) (215,072)
Services provided without charge by other government departments (Note 10) (1,110,000) (1,110,000)
Variations in statement of financial position:
Increase (decrease) in accounts receivable (15,709) 8,930
Decrease (Increase) in accounts payable and accrued liabilities 12,649 (26,069)
Decrease (increase) in vacation leave and compensatory leave (313) 9,105
Decrease (Increase) in employee future benefits (1,990) 45,000
Cash used in operating activities 8,296,310 5,188,543
Capital Investment Activities
Acquisitions of tangible capital assets 160,000 220,000
Cash used in capital investing activities 160,000 220,000
Net cash provided by Government of Canada 8,456,310 5,408,543

The accompanying notes form an integral part of these future-oriented financial statements.

Notes to the Future-Oriented Statements (unaudited)

For the Year Ended March 31, 2014

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 (RCMP 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 RCMP 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. Significant assumptions

The future-oriented statements have been prepared on the basis of the government priorities and the plans of the organization as described in the Report on Plans and Priorities.

The main assumptions are as follows:

  • (a) The Commission's activities will remain substantially the same as in the previous year.
  • (b) Estimated year-end information for 2012-13 is used as the opening position for the 2013-14 forecasts.  
  • (c) Expected Results for 2012-13 expenses and revenues, including the determination of amounts internal and external to the government, are based on historical experience.
  • (d) Forecasts for 2013-14 expenses and revenues are based on Main Estimates and do not reflect amounts which may be appropriated in Supplementary Estimates. These financial statements will not be updated to reflect changes through Supplementary Estimates.
  • (e) Allowances for uncollectibility are based on the likely outcome of actual situation.

These assumptions are adopted as at January 9, 2013.

3. Variations and changes to the forecast financial information

While every attempt has been made to accurately forecast final results for the remainder of 2012–13 and for 2013–14, actual results achieved for both years are likely to vary from the forecast information presented, and this variation could be material.

In preparing these financial statements, the Commission has made estimates and assumptions concerning the future. These estimates and judgements may differ from the subsequent actual results. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Factors that could lead to material differences between the Future-Oriented Statements of Operations and the Departmental Net Financial Position and historical statement of operations include:

  • (a) The timing and amounts of acquisitions and disposals of property, equipment may affect gains/losses and  amortization expense; and/or
  • (b) Further changes to the operating budget through additional new initiatives or technical adjustments later in the year.

Once the Report on Plans and Priorities is presented, the Commission will not be updating the forecasts for any changes to appropriations or forecast financial information made after January 9, 2013. Variances will be explained in the Departmental Performance Report.

4. Summary of significant accounting policies

The future-oriented statements have been prepared using the government's accounting policies stated below, which are 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:

(a) Parliamentary appropriations

The Commission is financed by the Government of Canada through Parliamentary authorities. The cash accounting basis is used to recognize transactions affecting parliamentary authorities. The future-oriented financial statements are based on accrual accounting. Consequently, items presented in the Future-Oriented Statement of Operations and Departmental Net Financial Position and in the Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament. Note 5 provides a reconciliation between these basis 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 Office are paid from the CRF. The net cash provided by the government is the difference between all cash receipts and all cash disbursements, including transactions between departments of the federal government.

(c) Amounts due from/to the CRF

Amounts due/from 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 Office is entitled to draw from the CRF without further authorities to discharge its liabilities.

(d) Revenues

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 the Commission's liabilities. While the Chair is expected to maintain accounting control, he has no authority regarding 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 in reduction of the entity's gross revenues.

(e) Expenses

  • 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 employer contributions to the health and dental insurance plans are recorded as operating expenses at their estimated cost.

(f) Employee future benefits

  1. Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multi-employer pension plan administered by the government. The Commission's contributions to the Plan are charged to expenses in the year incurred and represent the total obligation to the Plan. 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.
  2. Severance benefits: Employees entitled to severance benefits under conditions of employment earn these benefits as services necessary to earn them are rendered. The obligation relating to the benefits earned by employees is calculated using information derived from the results of 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 cost and recoverable value. A provision is made for receivables where recovery is considered uncertain.

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

5. 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 appropriations 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 requested authorities:
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Net cost of operations before government funding and transfers $9,954,978 $6,476,649
Adjustments for items affecting net cost of operations but not affecting authorities:
Add (Less):
Decrease (increase) in employee future benefits (note 8) (1,990) 45,000
Services provided without charge by other government departments (note 9) (1,110,000) (1,110,000)
Refund of prior year expenditures    
Adjustments to previous years' payables at year-end    
Decrease (increase) in vacation pay and compensatory leave (313) 1,905
Amortization of tangible capital assets (note 10) (183,305) (215,072)
Bad debt expenses - -
Adjustments for items not affecting net cost of operations but affecting authorities:
Add (Less):
Acquisition of tangible capital assets (note 8) 160,000 220,000
Proceeds from disposal of tangible capital assets - -
Forecast of authorities available 8,459,371 5,425,682

(b) Authorities requested

Authorities requested
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Program expenditures – Vote 65 $7,882,977 $4,850,334
Contributions to employee benefits plan 576,394 575,348
Forecast of authorities available $8,459,371 $5,425,682

Forecast authorities requested for the year ending March 31, 2014, are the planned spending amounts presented in the 2013–14 Report on Plans and Priorities. Estimated authorities requested for the year ending March 31, 2013, include amounts presented in the 2012–13 Main Estimates and supplementary Estimates (A) and (B), planned for presentation in Supplementary Estimates (C) and estimates of amounts to be allocated at year-end from Treasury Board central votes.

6. Accounts receivable and advances

The following table represents details of accounts receivable and advances:

Accounts receivable and advances
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Receivables – other government departments and agencies $39,043 $48,018
Receivables – external parties - -
Employee advances 667 622
Subtotal $39,710 $48,640
Allowance for doubtful accounts on receivables from external parties - -
Net accounts receivable $39,710 $48,640

7. Accounts payable and accrued liabilities

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

Accounts payable and accrued liabilities
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Accounts payable to other government departments and agencies $73,558 $90,631
Accounts payable to external parties 128,527 137,097
Total accounts payable $202,085 $227,728
Accrued liabilities 37,727 38,153
Total accounts payable and accrued liabilities $239,812 $265,881

8. 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. 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 2012-13 and 2013-14 expense amounts are estimated at $411,545 for both years, which represents approximately 1.8 times 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 salary at termination of employment. 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
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Accrued benefit obligation – beginning of year $338,010 $340,000
Expense for the year 141,990 9,272
Benefits paid during the year (140,000) (54,272)
Accrued benefit obligation – end of year $340,000 $295,000

9. 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 are obtained without charge from other government departments, as disclosed below:

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

During the year, the Commission is forecasted to receive services without charge from other departments, accommodation, the employer's contribution to the health and dental insurance plans and workers' compensation coverage. These services provided without charge have been recorded in the Commission's Future-Oriented Statement of Operations and Net Accountability as follows:

Common services provided without charge by other government departments
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Accommodation $750,000 $750,000
Employer's contributions to the health and dental insurance plans 360,000 360,000
Total $1,110,000 $1,110,000

The government has centralized some of its administrative activities for efficiency, cost-effectiveness purposes and economic delivery of programs to the public. As a result, the Government uses central agencies and common service organizations 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 Future-Oriented Statement of Operations and Departmental Net Financial Position.

b) Other transactions with related parties

Other transactions with related parties
  Estimated
2013
(in dollars)
Forecast
2014
(in dollars)
Expenses and revenues disclosed in (b) exclude common services provided without charge, which are already disclosed in (a).
Expenses – other government departments and agencies $536,385 $520,000

10. Tangible capital assets

For the Year Ended March 31, 2014

Cost (in dollars)
Capital asset class Opening balance Acquisitions Adjustments Closing balance
Computer hardware 106,357 10,000 0 116,357
Computer software 15,569 180,000 0 195,569
Other equipment including furniture 270,436 10,000 0 280,436
Leasehold improvements 667,008 20,000 0 687,008
Total $1,059,370 $220,000 $- $1,279,369
Accumulated Amortization (in dollars)
Capital asset class Opening balance Amortization Adjustments Closing balance
Computer hardware 33,036 15,194 0 48,230
Computer software 9,342 3,114 0 12,456
Other equipment including furniture 90,125 54,087 0 144,212
Leasehold improvements 246,971 142,677 0 389,648
Total $379,475 $215,072 $- $594,548
Net book value (in dollars)
Capital asset class 2014 2013
Computer hardware 68,127 73,321
Computer software 183,113 6,227
Other equipment including furniture 136,224 180,311
Leasehold improvements 297,360 420,037
Total $684,823 $679,896

11. 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 4. 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:

Segmented information (in dollars)
  Expected Results 2013
Total
Forecast 2014
Civilian Review
Forecast 2014
Internal Services
Forecast 2014
Total
Expenses
Salaries and employee benefits 5,843,170 1,800,772 2,387,070 4,187,842
Professional and special services 1,465,876 226,272 440,041 666,313
Accommodation 1,501,796 559,548 561,690 1,121,238
Travel and relocation 159,894 47,416 24,719 72,135
Equipment 116,161 3,347 56,296 59,643
Utilities, material and supplies 92,275 8,600 36,163 44,763
Communication 83,084 12,843 26,331 39,174
Equipment rentals 73,224 5,063 29,816 34,879
Information 37,351 2,731 10,673 13,404
Amortization 183,305 0 215,072 215,072
Repairs 38,842 486 21,700 22,186
Total expenses 9,594,978 2,667,078 3,809,571 6,476,649
Revenues
Respendable revenue - - - -
Miscellaneous revenue 5,892   5,500 5,500
Revenue earned on behalf of government (5,892)   (5,500) (5,500)
Total revenue -   - -
Net cost from continuing operations $9,594,978 $2,667,078 $3,809,571 $6,476,649

Date modified: