Future Oriented Statement of Operations March 31st, 2018

Statement of Management Responsibility

Management of the Parole Board of Canada (PBC) is responsible for the future-oriented statement of operations, including responsibility for the appropriateness of the assumptions on which the statements are prepared. The statements are based on the best information available and assumptions adopted as at November 30th, 2016 and reflect the plans described in the Departmental Plan.

Harvey Cenaiko
Chairperson

Cathy Gaudet, CPA, CA
Chief Financial Officer

Ottawa, Canada
January, 2017

Future-Oriented Statement of Operations For the Year Ending March 31

(in thousands of dollars) Estimated
Results
2016-17
Planned
Results
2017-18
Expenses
Conditional release decisions $ 42,139 $ 40,300
Conditional release openness and accountability 4,709 4,462
Record suspension decisions and clemency
recommendations

6,275

5,976
Internal services 8,021 7,661
Total expenses 61,144 58,399
Revenues
Regulatory fees 5,048 5,679
Revenues earned on behalf of Government (1,288) (1,449)
Total revenues 3,760 4,230
Net cost of operations $ 57,384 54,169

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

1. Methodology and Significant Assumptions

The future-oriented statement of operations has been prepared on the basis of government priorities and the departmental plans as described in the Departmental Plan.

The information in the estimated results for fiscal year 2016-17 is based on actual results as at November 30th, 2016 and on forecasts for the remainder of the fiscal year.  Forecasts have been made for the planned results for the 2017-18 fiscal year. 

The main assumptions underlying the forecasts are as follows:

  • The department’s activities will remain substantially the same as in the previous year;
  • Expenses and revenues, including the determination of amounts internal and external to the government are based on historical experience.  The general historical pattern is expected to continue.

These assumptions are adopted as at November 30th, 2016.

2. Variation and Changes to the Forecast Financial Information

While every attempt has been made to forecast final results for the remainder of 2016-17 and for
2017-18, actual results achieved for both years are likely to vary from the forecast information presented, and this variation could be material.

In preparing this future-oriented statement of operations the PBC 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 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 statement of operations and the historical financial statements of operations include the following:

  • The timing and amounts of acquisitions and disposals of equipment may affect gains/losses and amortization expense.
  • Implementation of new collective agreements.
  • Economic conditions may affect the amount of revenue earned.
  • Further changes to the operating budget through additional new initiatives or technical adjustments later in the year.

Once the Departmental Plan is presented, the PBC will not be updating the forecasts for any changes to appropriations or forecast financial information made in ensuing supplementary estimates. Variances will be explained in the Departmental Performance Report.

3. Summary of Significant Accounting Policies

The future-oriented statement of operations has been prepared using Government’s accounting policies that came in effect for the 2016-17 fiscal year which are based on 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
  2. Expenses are recorded on an accrual basis.  Expenses for the Department operations are recorded when goods are received or services are rendered including services provided without charges for accommodation, employee contributions to health and dental insurance plans, legal services and worker’s compensation which are recorded as expenses at their estimated cost.  Vacation pay and compensatory leave, as well as severance benefits, are accrued and expenses are recorded as the benefits are earned by employees under their terms of employment.

    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. 

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

    Other 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 Department 's liabilities. While the Deputy Head is expected to maintain accounting control, he or 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 the entity'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 do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Items recognized in the future-oriented statements 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 requested
authorities

(in thousands of dollars)
Estimated
2016-17
Planned
2017-18
Net cost of operations
$ 57,384 $ 54,169
Adjustment for items affecting net cost of operations but not
affecting authorities:
Services provided without charge by other government departments (7,680) (7,523)
Amortization of tangible capital assets (934) (582)
Employee future benefits (346) 137
Prepaid expenses previously charged to authorities (110) (110)
Vacation pay and compensatory leave (40) -
  (9,110) (8,078)
Adjustment for items not affecting net cost of operations but
affecting authorities:
Acquisitions of tangible capital assets 1,131 505
Prepaid expenses 110 110
  1,241 615
Requested authorities $ 49,515 $ 46,706
b) Authorities requested
(in thousands of dollars)
Estimated
2016-17
Planned
2017-18
Authorities requested:
Vote 1 - Program expenditures $ 43,396 $ 41,120
Statutory amounts 6,119 5,586
Less:
Lapsed authorities: Program expenditures - -
Requested authorities $ 49,515 $ 46,706

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