Future-Oriented Statement of Operations 2022-2023

Expenses

for the year ending March 31	Forecast results 2021-2022 (in dollars)	Planned results 2022-2023 (in dollars)
Polar Science and Knowledge	16,558,041	16,438,920
Internal Services	18,158,068	17,319,229
Total expenses	34,716,109	33,758,149

Revenues

for the year ending March 31	Forecast results 2021-2022 (in dollars)	Planned results 2022-2023 (in dollars)
Lease and use of public property	732,099	886,211
Revenues earned on behalf of Government	-	-
Total revenues	732,099	886,211

Net cost of operations before government funding and transfers

for the year ending March 31	Forecast results 2021-2022 (in dollars)	Planned results 2022-2023 (in dollars)
Expenses minus revenues	33,984,010	32,871,938

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

Notes to Future-Oriented Statements of Operations (unaudited)

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 December 31, 2021 and on forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for the 2022-23 fiscal year.

The main assumptions underlying the forecasts are as follows:

• The activities of the organization will evolve following the implementation of the Station;
• Expenses, including the determination of amounts internal and external to the government, are based on past experience. The general historical pattern is expected to continue;
• Revenues were estimated based on the anticipated number of employees to be located in Cambridge Bay and will occupy rental units.

These assumptions are made as at December 31, 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, the department 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 past 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:

• the timing and the amount of acquisitions, transfers and disposals of property, plant and equipment, which may affect gains, losses and amortization expense;
• the implementation of new collective agreements;
• economic conditions, which may affect both the amount of revenue earned and the collectability of loan receivables;
• the COVID-19 pandemic could significantly impact the department's program delivery;
• other changes to the operating budget, such as new initiatives or technical adjustments later in the fiscal year.

"After the Departmental Plan is tabled in Parliament, Polar Knowledge Canada 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

The department records expenses on an accrual basis.

Expenses for the department's operations are recorded when goods are received or services are rendered, including services provided without charge for employer contributions to health and dental insurance plans, 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.

Transfer payments are recorded as expenses when the recipients have met all the eligibility criteria and the transfers are authorized by March 31. In the case of transfers that do not form part of an existing program, the transfers are considered to be authorized 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 financial statements.

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.

b) Revenues

Revenues from the lease and use of public property are recognized in the period the event giving rise to the revenues occurred.

4. Parliamentary authorities

The department is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to the department 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, 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:

Reconciliation of net cost of operations to requested authorities	Forecast results 2021-2022 (in dollars)	Planned results 2022-2023 (in dollars)
Net cost of operations before government funding and transfers	33,984,010	32,871,938
Revenues received pursuant to subsection 6(2) of the Canadian High Arctic Research Station Act	732,099	886,211
Adjustments for items affecting net cost of operations but not affecting authorities: Amortization of tangible capital assets	(271,455)	(322,472)
Adjustments for items affecting net cost of operations but not affecting authorities: Services provided without charge by other government departments	(523,524)	(523,524)
Adjustments for items affecting net cost of operations but not affecting authorities: Decrease (increase) in vacation pay and compensatory leave	(87,821)	(87,821)
Adjustments for items affecting net cost of operations but not affecting authorities: Decrease (increase) in employee future benefits	(3,193)	(3,193)
Total items affecting net cost of operations but not affecting authorities	(885,993)	(937,010)
Adjustments for items not affecting net cost of operations but affecting authorities: Acquisitions and improvements to tangible capital assets	(530,124)	(455,000)
Adjustments for items not affecting net cost of operations but affecting authorities: Increase (decrease) in prepaid expenses	-	-
Total items not affecting net cost of operations but affecting authorities	(530,124)	(455,000)
Requested authorities forecast to be used	33,299,992	32,366,139

(b) Authorities provided / requested

Authorities provided / requested	Forecast results 2021-2022 (in dollars)	Planned results 2022-2023 (in dollars)
Authorities provided / requested: Vote 1 - Program expenditures	30,843,899	29,886,748
Statutory amounts: Expenditures equivalent to revenue received pursuant to subsection 6(2) of the Canadian High Arctic Research Station Act	732,099	732,099
Statutory amounts: Contributions to employee benefits plan	1,723,994	1,747,292
Total authorities provided / requested	33,299,992	32,366,139
Requested authorities forecast to be used (less: Estimated unused authorities and other adjustments)	33,299,992	32,366,139