Future-oriented Statement of Operations

Future-Oriented Statement of Operations (unaudited)
For the Year Ending March 31
(in dollars)

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Future-Oriented Statement of Operations (unaudited) for the year ending March 31
  Forecast Results
Planned Results
Business Services $ 33,973,028 $ 82,563,746
Business Growth 35,062,986 76,156,043
Community Initiatives 51,583,578 42,267,512
Innovation 8,428,487 20,741,324
Internal Services 4,322,866 7,243,182
Expenses incurred on behalf of government (25,190,925) 3,173,475
Total expenses 108,180,020 232,145,282
Amortization of discount 0 1,750,513
Interest 1,124 562
Other 238 178
Revenues earned on behalf of government (1,286) (1,751,198)
Total revenues 76 55
Net cost of operations before government funding and transfers $ 108,179,944 $ 232,145,227

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

Notes to the Future-Oriented Statement of Operations (unaudited)
For the year ending March 31

1. Methodology and significant assumptions

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

The information in the forecast results for fiscal year 2021–22 is based on actual results as at November 30, 2021 and on forecasts for the remainder of the fiscal year.  Forecasts have been made for the planned results for fiscal year 2022–23.

The main assumptions underlying the forecasts are as follows:

These assumptions are made as at November 30, 2021.

2. Variations and changes to the forecast financial information

Although every attempt has been made to forecast final results for the remainder of 2021–22 and for 2022–23, 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, Pacific Economic Development Canada (PacifiCan) 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 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:

After the Departmental Plan is tabled in Parliament, PacifiCan 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 fiscal year 2021–22, 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:

a) Expenses

Transfer payments are recorded as an expense 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 and inventory obsolescence, as well as utilization of inventories and prepaid expenses, and other are also included in other expenses.

b) Revenues

Revenues from regulatory fees are recognized 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 PacifiCan’s liabilities. Although the deputy head is expected to maintain accounting control, he has no authority over the disposition of non-respendable revenues. As a result, non-respendable revenues are earned on behalf of the Government of Canada and are therefore presented as a reduction of PacifiCan’s gross revenues.

4. Parliamentary authorities

PacifiCan is financed by the Government of Canada through parliamentary authorities.  Financial reporting of authorities provided to PacifiCan 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, PacifiCan 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 requested authorities

  Forecast Results
Planned Results
(in dollars)
Net cost of operations before government funding and transfers $ 108,179,944 $ 232,145,227
Adjustment for items affecting net cost of operations but not affecting authorities:
Services provided without charge by other government departments (1,350,953) (2,273,563)
Decrease (increase) in vacation pay and compensatory leave 3,789 (736,998)
Decrease (increase) in employee future benefits (71,774) 8,545
Decrease (increase) in accrued liabilities not charged to authorities 19,932 173,550
Refunds of previous years' expenditures 46,829 48,991
Other 76 55
Total items affecting net cost of operations but not affecting authorities (1,352,101) (2,779,420)
Adjustment for items not affecting net cost of operations but affecting authorities:
Unconditionally repayable transfer payments 66,528,591 25,641,715
Increase in employee advances 1,350 3,740
Total items not affecting net cost of operations but affecting authorities 66,529,941 25,645,455
Requested authorities forecasted to be used $ 173,357,784 $ 255,011,262

b) Authorities provided/requested

  Forecast Results
Planned Results
(in dollars)
Authorities provided/requested
Vote 1 - Operating expenditures $ 22,837,934 $ 26,202,522
Vote 5 - Transfer payments 207,333,025 226,052,644
Statutory amounts 3,206,984 2,756,096
Total authorities provided/requested $ 233,377,943 $ 255,011,262
Less: Estimated unused authorities and other adjustments (60,020,159) 0
Requested authorities forecasted to be used $ 173,357,784 $ 255,011,262
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