Immigration, Refugees and Citizenship Canada Consolidated Future-Oriented Statement of Operations (unaudited) For the Year Ending March 31, 2018

Forecast Results 2016-2017
(in thousands of dollars)
Planned Results 2017-2018
(in thousands of dollars)
Newcomer Settlement and Integration $1,249,103 $1,208,022
Passport 488,259 461,639
Migration Control and Security Management 274,768 242,262
Citizenship for Newcomers and All Canadians 83,000 83,638
Permanent Economic Residents 84,349 78,345
Family and Discretionary Immigration 95,411 76,645
Temporary Economic Residents 98,691 71,452
Health Protection 85,924 70,204
Refugee Protection 99,669 58,506
Canadian Influence in International Migration and Integration Agenda 9,019 9,218
Internal Services 244,195 240,721
Total Expenses $2,812,388 $2,600,652
Passport fees earned $665,968 $609,077
Immigration service fees 493,171 468,315
Right of permanent residence 122,791 123,779
Citizenship service fees 133,829 133,829
Right of citizenship 23,514 23,514
International Experience Canada 9,938 9,938
Interest on loans 220 200
Passport miscellaneous revenues 250 250
Other 351 289
Revenues earned on behalf of Government (773,863) (749,913)
Total Revenues 676,169 619,278
Net cost of operations before government funding and transfers $2,136,219 $1,981,374

The accompanying notes form an integral part of this Consolidated Future-Oriented Statement of Operations.

1. Methodology and Significant Assumptions

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

The main assumptions are as follows:

  1. IRCC’s activities for both 2016-2017 and 2017-2018 will be strongly focused on meeting the government’s objectives of resettling refugees as well as solidifying Canada’s commitment to an immigration system that strengthens the Canadian middle class through economic growth and attracting investment, supports diversity and helps build vibrant, dynamic and inclusive communities.
  2. Expenses and revenues, including the determination of amounts internal and external to the government, are based on historical experience and knowledge of IRCC operations, with the exception of the Passport Program, and the current efforts on refugees. Expenses and revenues related to the Passport Program are based on forecasted volumes.

These assumptions are adopted as at January 27, 2017.

2. Variations and Changes to the Forecast Financial Information

Although every attempt has been made to forecast final results for the remainder of 2016-2017 and for 2017-2018, actual results achieved for both years are likely to differ from the forecast information presented, and this variation could be material.

In preparing the Consolidated Future-Oriented Statement of Operations, IRCC has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions 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 Consolidated Future-Oriented Statement of Operations and the historical statement of operations include the following:

  1. the timing and amount of acquisitions and disposals of property, plant and equipment 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. further changes to the operating budget through additional new initiatives or technical adjustments later in the fiscal year.

After the Departmental Plan is tabled in Parliament, IRCC will not be updating the forecasts for any changes in financial resources made in ensuing supplementary estimates.

3. Summary of Significant Accounting Policies

The Consolidated Future-Oriented Statement of Operations has been prepared using the Government of Canada’s accounting policies in effect for fiscal year 2016-2017 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. Consolidation

This Consolidated Future-Oriented Statement of Operations includes the accounts of the Passport Program Revolving Fund for which the Deputy Head (DH) is accountable. The accounts of the Passport Program Revolving Fund have been consolidated with those of IRCC, and all inter-organizational balances and transactions have been eliminated.

b. Expenses

Expenses are recorded on an accrual basis. Expenses for IRCC’s operations are recorded when goods are received or services are rendered, including services provided without charge for international immigration services at missions abroad, accommodation, employer contributions to health and dental insurance plans, legal services, and workers’ compensation, which are recorded as expenses at their estimated cost. Vacation pay and compensatory leave are accrued and expenses are recorded as the benefits are earned by employees under their respective terms of employment.

Transfer payments are recorded as expenses when authorization of the payment exists and the recipient has met the eligibility criteria or the entitlements established for the transfer payment program. In situations where payments do not form part of an existing program, transfer payments are recorded as expenses when the Government announces a decision to make a non-recurring transfer, provided the enabling legislation or authorization for payment receives parliamentary approval prior to the completion of the consolidated financial statements. Transfer payments that become repayable as a result of conditions specified in the contribution agreement that have come into being are recorded as a reduction to transfer payment expense and as a receivable.

Expenses also include provisions to reflect changes in the value of assets, including provisions for bad debt on accounts receivable, provisions for valuation on loans, investments and advances and inventory obsolescence, or liabilities, including contingent liabilities to the extent the future event is likely to occur and a reasonable estimate can be made.

Expenses also include amortization of tangible capital assets, which are capitalized at their acquisition cost. Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset.

c. Revenues

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

The recognition of revenues from immigration service fees and citizenship service fees is considered deferred until the application is processed, while the recognition of revenues from rights (right of citizenship and right of permanent residence) is deferred until the right is granted. Revenues from passport fees are recognized upon request for a passport service, which is upon receipt of payment and verification of the passport application for completeness. Other revenues, including International Experience Canada, are accounted for in the period in which the underlying transaction or event that gave rise to the revenues takes place.

Revenues that are non-respendable are not available to discharge IRCC’s liabilities. While the DH is expected to maintain accounting control, she 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 IRCC’s gross revenues.

Revenues that are respendable are available to discharge the liabilities of the Passport and International Experience Canada programs.

4. Parliamentary Authorities

IRCC is mainly financed by the Government of Canada through parliamentary authorities. IRCC is also responsible for the management of the Passport Program Revolving Fund, a continuing non-lapsing authority from Parliament to make payments out of the Consolidated Revenue Fund for working capital, capital acquisitions and temporary financing of accumulated operating deficits. Employee benefits are authorized by a statutory authority. IRCC issues immigration loans through a non-budgetary non-lapsing authority.

Financial reporting of authorities provided to IRCC do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Items recognized in the Consolidated Future-Oriented Statement of Operations in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, IRCC 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
Forecast Results 2016-2017
(in thousands of dollars)
Planned Results 2017-2018
(in thousands of dollars)
Net cost of operations before government funding and transfers $2,136,219 $1,981,374
Adjustments for items affecting net cost of operations but not affecting authorities :
Amortization of tangible capital assets (34,267) (37,159)
Gain on disposal of tangible capital assets 13 13
Services provided without charge by other government departments (327,434) (326,206)
Decrease in vacation pay and compensatory leave 1,287 1,422
Decrease in employee future benefits not charged to authorities 143 191
Decrease in accrued liabilities not charged to authorities 652 632
Bad debt expense 843 (18)
Refund of previous year’s expenditures 1,491 1,415
Other 410 566
Total items affecting net cost of operation but not affecting authorities (356,862) (359,144)
Adjustments for items not affecting net cost of operations but affecting authorities :
Acquisition of tangible capital assets 13,870 24,200
Proceeds from disposal of tangible capital assets (13) (13)
Decrease in loans issued on behalf of Government (2,014) (808)
Decrease in inventory held for resale (4,054) (672)
Increase (decrease) in consumable inventory (632) 167
Increase in prepaid expenses 953 1,008
Federal Skilled Worker, Immigrant Investor Program and Entrepreneur Program returned fees 3,611 3,912
Refunds of prior years’ revenues 9,415 9,425
Other (94) 40
Total items not affecting net cost of operations but affecting authorities 21,042 37,259
Requested authorities $1,800,399 $1,659,489
b. Authorities requested
Forecast Results
(in thousands of dollars)
Planned Results
(in thousands of dollars)
Authorities requested
Vote 1 – Operating Expenditures $681,061 $545,295
Vote 5 – Capital Expenditures 12,888 23,756
Vote 10 – Grants and Contributions 1,210,139 1,170,172
Non-budgetary items (2,014) (808)
Statutory amounts – Passport (net revenues) (184,208) (151,038)
Statutory amounts – Other 82,533 72,112
Total authorities requested $1,800,399 $1,659,489
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