Financial Statements 2019-2020

Statement of Management Responsibility Including Internal Control over Financial Reporting

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2020 and all information contained in these statements rests with the management of Polar Knowledge Canada (POLAR). These financial statements have been prepared by management using the Government's accounting policies, which are based on Canadian public sector accounting standards.

Management is responsible for the integrity and objectivity of the information in these financial statements. Some of the information in the financial statements is based on management's best estimates and judgment, and gives due consideration to materiality. To fulfill its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of POLAR’s financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in POLAR’s Departmental Results Report, is consistent with these financial statements.

Management is also responsible for maintaining an effective system of internal control over financial reporting (ICFR) designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are properly authorized and recorded in accordance with the Financial Administration Act and other applicable legislation, regulations, authorities and policies.

Management seeks to ensure the objectivity and integrity of data in its financial statements through careful selection, training and development of qualified staff; through organizational arrangements that provide appropriate divisions of responsibility; through communication programs aimed at ensuring that regulations, policies, standards, and managerial authorities are understood throughout POLAR and through conducting an annual risk-based assessment of the effectiveness of the system of ICFR.

The system of ICFR is designed to mitigate risks to a reasonable level based on an ongoing process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

POLAR will be subject to periodic Core Control Audits performed by the Office of the Comptroller General and will use the results of such audits to adhere to the Treasury Board Policy on Financial Management.

During 2019-2020, POLAR has continued to make progress towards ensuring that a risk-based departmental system of internal control over financial management is established, monitored and maintained. A multi-phase risk based assessment plan is being established. The plan is progressing from the documentation of the key internal control processes, through the design and operating effectiveness testing of controls, to the full ongoing monitoring stage. Additional information regarding POLAR’s progress is presented in the annex as required by the Treasury Board Policy on Financial Management.

The financial statements of POLAR have not been audited.

_____________________________
Julie Laghi, CPA, CMA
A/President and Chief Executive Officer
Executive Director, Corporate Services & Chief Financial Officer
Ottawa, Canada
Date: October 6, 2020

Statement of Financial Position (Unaudited)

As at March 31


(in dollars)

2020

2019
Liabilities
  • Accounts payable and accrued liabilities (Note 4)
4,581,167 4,176,810
  • Vacation pay and compensatory leave
802,476 350,455
  • Employee future benefits (Note 5)
123,254 111,832
Total liabilities 5,506,897 4,639,097
Financial assets
  • Due from Consolidated Revenue Fund
4,376,232 4,021,357
  • Accounts receivable and advances (Note 6)
374,073 431,001
Total financial assets 4,750,305 4,452,358
Departmental net debt 756,592 186,739
Non-financial assets
  • Prepaid expenses
29,644 41,410
  • Tangible capital assets (note 7)
1,715,699 1,905,089
Total non-financial assets 1,745,343 1,946,499
Departmental net financial position 988,751 1,759,760

Contractual obligations (note 8)

_____________________________
Julie Laghi, CPA, CMA
A/President and Chief Executive Officer
Executive Director, Corporate Services & Chief Financial Officer
Ottawa, Canada
Date: October 6, 2020

Statement of Operations and Departmental Net Financial Position (Unaudited)

For the Year Ended March 31



(in dollars)
Planned
Results
2020


2020


2019
Expenses
  • Polar Science and Knowledge
16,523,491 15,871,352 15,882,870
  • Internal services
16,877,567 15,802,147 9,268,340
Total expenses 33,401,058 31,673,499 25,151,210
Revenues
  • Lease and use of public property
363,295 300,815 294,238
  • Revenues earned on behalf of Government
(363,295) (300,815) (294,238)
Total revenues - - -
Net cost of operations before government funding and transfers 33,401,058 31,673,499 25,151,210
Government funding and transfers
  • Net cash provided by Government of Canada
29,954,573 23,294,427
  • Change in due from Consolidated Revenue Fund
354,875 1,303,665
  • Services provided without charge by other government departments (note 9)
599,173 596,306
  • Transfer of capital assets from other government departments
- 91,507
Total government funding and transfers 30,902,490 25,285,905
Net cost of operations after government funding and transfers 771,009 (134,695)
Departmental net financial position - Beginning of year 1,759,760 1,625,065
Departmental net financial position - End of year 988,751 1,759,760

Segmented information (note 10)

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

Statement of Change in Departmental Net Debt (Unaudited)

For the Year Ended March 31


(in dollars)

2020

2019
Net cost of operations after government funding and transfers 771,009 (134,695)
Change due to tangible capital assets
  • Acquisition of tangible capital assets
119,621 256,037
  • Amortization of tangible capital assets
(308,675) (249,615)
  • Net loss on disposal of tangible capital assets including adjustments
(336) -
  • Transfer from other government departments
- 91,507
Total change due to tangible capital assets (189,390) 97,929
Change due to prepaid expenses (11,766) 29,441
Net increase (decrease) in departmental net debt 569,853 (7,325)
Net decrease in departmental net debt 569,853 (7,325)
Departmental net debt - Beginning of year 186,739 194,064
Departmental net debt - End of year 756,592 186,739

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

Statement of Cash Flows (Unaudited)

For the Year Ended March 31


(in dollars)

2020

2019
Operating activities
Net cost of operations before government funding and transfers 31,673,499 25,151,210
Non-cash items:
  • Amortization of tangible capital assets
(308,675) (249,615)
  • Net loss on disposal of tangible capital assets including adjustments
(336) -
  • Services provided without charge by other government departments (Note 9)
(599,173) (596,306)
Variations in Statement of Financial Position:
  • (Decrease) increase in accounts receivable and advances
(56,928) 103,741
  • (Decrease) increase in prepaid expenses
(11,766) 29,441
  • Increase in accounts payable and accrued liabilities
(404,357) (1,280,647)
  • Increase in vacation pay and compensatory leave
(452,021) (107,185)
  • Increase in employee future benefits
(11,422) (12,249)
Cash used in operating activities 29,834,952 23,038,390
Capital investing activities
  • Acquisition of tangible capital assets
119,621 256,037
Cash used in capital investing activities 119,621 256,037
Net cash provided by Government of Canada 29,954,573 23,294,427

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

Notes to the Financial Statements (Unaudited)

For the Year Ended March 31

  1. Authority and objectives

    Polar Knowledge Canada (POLAR) is a federal agency (departmental corporation) that was established with the coming into force of the Canadian High Arctic Research Station Act on June 1, 2015. POLAR is responsible for advancing Canada’s knowledge of the Arctic, strengthening Canadian leadership in polar science and technology, and promoting the development and distribution of knowledge of other circumpolar regions, including Antarctica. POLAR operates the Canadian High Arctic Research Station (CHARS) campus and conducts world-class cutting edge Arctic research out of this extraordinary facility.

    The Statement of Operations and Departmental Net Financial Position presents the Core responsibilities and Internal services:

    Polar Science and Knowledge: Polar Knowledge Canada is Canada’s polar science agency operating out of the world-class Canadian High Arctic Research Station campus in Cambridge Bay, Nunavut. Polar Knowledge Canada performs and publishes multi-disciplinary polar research. Through its grants and contributions program, it funds external partners such as academia, northern communities and organizations who conduct research and related projects. Polar Knowledge Canada aims to include Indigenous and local knowledge wherever possible, and increases domestic and international research coordination and collaboration by leveraging resources with partners. Through workshops, conferences, social media, and other tools, Polar Knowledge Canada shares and promotes the exchange of knowledge across polar scientific and policy communities and the general public. Throughout all of its core activities, Polar Knowledge Canada aims to fund and train the next generation of polar research personnel, with a focus on northern youth.

    Internal services: 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. Internal services include only those activities and resources that apply across an organization, and not those provided to a specific program. The groups of activities are; Management and Oversight Services, Communications Services, Legal Services, Human Resources Management Services, Financial Management Services, Information Management Services, Information Technology Services, Real Property Services, Materiel Services and Acquisition Services.

  1. Summary of significant accounting policies

    These financial statements are prepared using POLAR'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 authorities
    POLAR is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to POLAR do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Consequently, items recognized in the 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 3 provides a reconciliation between the bases of reporting. The planned results amounts in the "Expenses" and "Revenues" section of the Statement of Operations and Departmental Net Financial Position are the amounts reported in the Future-oriented Statement of Operations included in the 2019-2020 Departmental Plan. Planned results are not presented in the “Government funding and transfers” section of the Statement of Operations and Departmental Net Financial Position and in the Statement of Change in Departmental Net Debt because these amounts were not included in the 2019-2020 Departmental Plan.

    (b) Net cash provided by Government of Canada
    POLAR operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by POLAR is deposited to the CRF, and all cash disbursements made by POLAR are paid from the CRF. The net cash provided by Government is the difference between all cash receipts and all cash disbursements, including transactions between departments of the Government.

    (c) Amounts due 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 POLAR is entitled to draw from the CRF without further authorities to discharge its liabilities.

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

    Revenues that are non-respendable are not available to discharge POLAR's liabilities. While the President and Chief Executive Officer 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 as a reduction of the entity's gross revenues.

    (e) Expenses
    Expenses are recorded on the accrual basis:

    • Transfer payments are recorded as an expense in the year the transfer is authorized and all eligibility criteria have been met by the recipient.
    • 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 employer contributions to the health and dental insurance plans are recorded as operating expenses at their carrying value.

    (f) Employee future benefits

    • Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multiemployer pension plan administered by the Government. POLAR’s contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. POLAR’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.
    • Severance benefits: The accumulation of severance benefits for voluntary departures ceased for applicable employee groups. The remaining obligation for employees who did not withdraw benefits is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.

    (g) Accounts receivable
    Accounts receivable are stated at the lower of cost and net recoverable value. A valuation allowance is recorded for accounts receivable where recovery is considered uncertain.

    (h) Non-financial assets
    The costs of acquiring land, buildings, equipment and other capital property are capitalized as tangible capital assets and, except for land, are amortized to expense over the estimated useful lives of the assets, as described in Note 7. All tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. Tangible capital assets do not include immovable assets located on reserves as defined in the Indian Act, works of art, museum collection and Crown land to which no acquisition cost is attributable; and intangible assets.

    (i) Contingent liabilities
    Contingent liabilities are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, a provision is accrued and an expense recorded to other expenses. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.

    (j) Measurement uncertainty
    The preparation of these financial statements requires management to make estimates and assumptions that affect the reported and disclosed amounts of assets, liabilities, revenues and expenses reported in the financial statements and accompanying notes at March 31. The estimates are based on facts and circumstances, historical experience, general economic conditions and reflect the Government's best estimate of the related amount at the end of the reporting period. The most significant items where estimates are used are contingent liabilities, the liability for employee future benefits and the useful life of tangible capital assets. Actual results could significantly differ from those estimated. Management’s estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

    (k) Related party transactions
    Related party transactions, other than inter-entity transactions, are recorded at the exchange amount.

    Inter-entity transactions are transactions between commonly controlled entities. Inter-entity transactions, other than restructuring transactions, are recorded on a gross basis and are measured at the carrying amount, except for the following:

    • Services provided on a recovery basis are recognized as revenues and expenses on a gross basis and measured at the exchange amount.
    • Certain services received on a without charge basis are recorded for departmental financial statement purposes at the carrying amount.
  1. Parliamentary authorities

    POLAR receives its funding through annual parliamentary authorities. Items recognized in the Statement of Operations and Departmental Net Financial Position and the Statement of Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, POLAR 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 current year authorities used

    (in dollars) 2020 (Note 11)
    2019
    Net cost of operations before government funding and transfers 31,673,499 25,151,210
    Adjustments for items affecting net cost of operations but not affecting authorities:
    • Services provided without charge by other government departments
    (599,173) (596,306)
    • Amortization of tangible capital assets
    (308,675) (249,615)
    • Net loss on disposal of tangible capital assets including adjustments
    (336) -
    • Increase in vacation pay and compensatory leave
    (452,021) (107,185)
    • Increase in employee future benefits
    (11,422) (12,249)
    • Refund of prior years' expenditures
    135,740 116,888
    • Decrease in accrued liabilities not charged to authorities
    - 24,500
    Total items affecting net cost of operations but not affecting authorities (1,235,887) (823,967)
    Adjustments for items not affecting net cost of operations but affecting authorities:
    • Variation in prepaid expenses
    (11,766) 29,441
    • Acquisition of tangible capital assets
    119,621 256,037
    • Variation in advances
    32,025 43,950
    Total items not affecting net cost of operations but affecting authorities 139,880 329,428
    Current year authorities used 30,577,492 24,656,671

(b) Authorities provided and used

(in dollars) 2020 2019
Authorities provided:
  • Vote 1 - Program expenditures
32,794,357 26,972,600
  • Statutory amounts
1,143,190 956,451
Total authorities provided 33,937,547 27,929,051
Less:
  • Lapsed: Operating
(3,360,055) (3,272,380)
Current year authorities used 30,577,492 24,656,671
  1. Accounts payable and accrued liabilities

    (in dollars) 2020 2019
    Accounts receivable - Other government departments and agencies 1,754,466 1,919,577
    Accounts payable - External parties 1,674,992 784,918
    3,429,458 2,704,495
    Accrued liabilities 1,151,709 1,472,315
    Total accounts payable and accrued liabilities 4,581,167 4,176,810
  1. Employee future benefits

    (a) Pension benefits
    POLAR's employees participate in the Public Service Pension Plan (the Plan), which is sponsored and administered by the Government of Canada. 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 POLAR contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to the Economic Action Plan 2012, employee contributors have been divided into two groups – Group 1 relates to existing plan members as of December 31, 2012 and Group 2 relates to members joining the Plan as of January 1, 2013. Each group has a distinct contribution rate.

    The 2019-2020 expense amounts to $792,002 ($667,029 in 2018-2019). For Group 1 members, the expense represents approximately 1.01 times (1.01 times in 2018-2019) the employee contributions and, for Group 2 members, approximately 1.00 times (1.00 times in 2018-2019) the employee contributions.

    POLAR'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

    Severance benefits provided to POLAR's employees were previously based on an employee’s eligibility, years of service and salary at termination of employment. However, since 2011 the accumulation of severance benefits for voluntary departures progressively ceased for substantially all employees. Employees subject to these changes were given the option to be paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits upon departure from the public service. By March 31, 2020, substantially all settlements for immediate cash out were completed. Severance benefits are unfunded and, consequently, the outstanding obligation will be paid from future authorities.

    The changes in the obligations during the year were as follows:

    (in dollars) 2020 2019
    Accrued benefit obligation - Beginning of year 111,832 99,583
    Expense for the year 11,422 14,299
    Benefits paid during the year - (2,050)
    Accrued benefit obligation - End of year 123,254 111,832
  1. Accounts receivable and advances

    The following table presents details of POLAR's accounts receivable and advances:

    (in dollars) 2020 2019
    Receivables - Other government departments and agencies 204,927 98,816
    Receivables - External parties 103,318 214,594
    Employee advances 65,828 117,591
    Total accounts receivable and advances 374,073 431,001
  1. Tangible capital assets

    Amortization of tangible capital assets is done on a straight line basis over the estimated useful like of the assets as follows:

    Asset Class Amortization Period
    Machinery and equipment 5 years
    Informatics hardware 5 years
    Other equipment, including furniture 5 to 10 years
    Ships and boats 10 years
    Motor vehicles (Non-military) 4 to 7 years
    Other vehicles 10 years
    Leasehold improvements Lesser of the remaining term of lease or useful life of the improvement
    Cost
    (in dollars)
    Opening Balance Acquisitions Adjustments Disposals and Write-Offs Closing Balance
    Machinery and equipment 1,374,632 34,423 (336) - 1,408,719
    Informatics hardware 62,221 - - - 62,221
    Other equipment, including furniture 23,504 - - - 23,504
    Ships and Boats 23,400 22,115 - - 45,515
    Motor Vehicles (Non-Military) 291,092 - - - 291,092
    Other Vehicles 278,250 63,083 - - 341,333
    Leasehold improvements 539,328 - - - 539,328
    Total 2,592,427 119,621 (336) - 2,711,712
    Accumulated Amortization
    (in dollars)
    Opening Balance Amortization Adjustments Disposals and Write-Offs Closing Balance
    Machinery and equipment 344,902 136,344 - - 481,246
    Informatics hardware 8,296 16,593 - - 24,889
    Other equipment, including furniture 10,577 2,350 - - 12,927
    Ships and Boats 10,335 3,815 - - 14,150
    Motor Vehicles (Non-Military) 193,200 62,696 - - 255,896
    Other Vehicles 10,335 32,030 - - 42,365
    Leasehold improvements 109,693 54,847 - - 164,540
    Total 687,338 308,675 - - 996,013
    Net Book Value
    (in dollars)
    2020 2019
    Machinery and equipment 927,473 1,029,730
    Informatics hardware 37,332 53,925
    Other equipment, including furniture 10,577 12,927
    Ships and Boats 31,365 13,065
    Motor Vehicles (Non-Military) 35,196 97,892
    Other Vehicles 298,968 267,915
    Leasehold improvements 374,788 429,635
    Total 1,715,699 1,905,089
  1. Contractual obligations

    The nature of POLAR’s activities can result in some large multi-year contracts and obligations whereby POLAR will be obligated to make future payments in order to carry out its transfer payment programs or when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:


    (in dollars)

    2021

    2022

    2023

    2024
    2025 and
    subsequent

    Total
    Transfer payments 253,234 - - - - 253,234
    Total 253,234 - - - - 253,234
  1. Related party transactions

    POLAR is related as a result of common ownership to all government departments, agencies, and Crown corporations. Related parties also include individuals who are members of key management personnel or close family members of those individuals, and entities controlled by, or under shared control of, a member of key management personnel or a close family member of that individual.

    POLAR enters into transactions with these entities in the normal course of business and on normal trade terms.

    a) Common services provided without charge by other government departments
    During the year, POLAR received services without charge from certain common service organizations, related to the employer’s contribution to the health and dental insurance plans. These services provided without charge have been recorded at the carrying value in POLAR’s Statement of Operations and Departmental Net Financial Position as follows:

    (in dollars) 2020 2019
    Employer's contribution to the health and dental insurance plans 599,173 596,306
    Total 599,173 596,306

    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 the payroll and cheque issuance services provided by Public Services and Procurement Canada are not included in the Department’s Statement of Operations and Departmental Net Financial Position.

    (b) Other transactions with other government departments and agencies

    (in dollars) 2020 2019
    Accounts receivable 204,927 98,816
    Accounts payable 1,754,466 1,919,577
    Expenses 9,484,999 6,072,941

    Expenses and revenues disclosed in (b) exclude common services provided without charge, which are already disclosed in (a).

  1. Related party transactions

    Presentation by segment is based on POLAR's core responsibility. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in note 2. The following table presents the expenses incurred and revenues for the core responsibility, by major object of expense and type of revenue. The segment results for the period are as follows:

    (in dollars) Polar Science and Knowledge Internal Services 2020 2019
    Transfer payments
    • Other Levels of Government
    4,451,598 - 4,451,598 6,348,679
    • Non-profit institutions and other organizations
    1,467,137 - 1,467,137 1,694,641
    • Indigenous peoples
    472,912 - 472,912 642,850
    • Industry
    429,400 - 429,400 226,200
    • Individuals
    13,000 - 13,000 10,000
    Total transfer payments 6,834,047 - 6,834,047 8,922,370
    Operating expenses
    • Salaries and employee benefits
    5,371,026 4,818,290 10,189,316 8,580,370
    • Professional services
    727,472 2,418,529 3,146,001 2,591,762
    • Transportation and telecommunications
    1,433,668 2,790,323 4,223,991 2,015,918
    • Rentals
    18,435 1,108,827 1,127,262 1,157,280
    • Repairs and maintenance
    1,172 2,435,949 2,437,121 544,595
    • Utilities, materials and supplies
    74,471 1,836,219 1,910,690 510,668
    • Machinery and equipment
    452,883 168,452 621,335 338,080
    • Amortization of tangible capital assets
    237,235 71,440 308,675 249,615
    • Information
    683,223 99,995 783,218 222,789
    • Other
    37,720 54,123 91,843 17,763
    Total Operating expenses 9,037,305 15,802,147 24,839,452 16,228,840
    Total expenses 15,871,352 15,802,147 31,673,499 25,151,210
    Revenues
    • Lease and use of public property
    225,448 75,367 300,815 294,238
    • Revenues earned on behalf of Government
    (225,448) (75,367) (300,815) (294,238)
    Total revenues - - - -
    Net cost from continuing operations 15,871,352 15,802,147 31,673,499 25,151,210
  1. Comparative information

    Certain comparative figures have been reclassified to conform to the current year’s presentation.

Annex: Internal Control Over Financial Reporting

  1. Introduction

    As a new department, created in 2015, Polar Knowledge Canada (POLAR) is continually strengthening its system of internal control as the organization matures, its governance structures are refined and it approaches steady-state operations.

    During 2018-19, the department undertook the requisite preliminary steps towards enabling the structured ongoing assessment of the performance of its financial controls by documenting the following key business processes:

    • Delegation of Authorities
    • Allotment, Budgeting and Forecasting
    • Transfer Payments
    • Pay and Benefits
    • Purchases, Payables and Payments

    Key control points for these business processes, as well as entity level controls and IT general controls, were identified and their design effectiveness assessed. That assessment identified some control deficiencies and during 2019-2020, attention was directed towards remediating those deficiencies.

  1. Remediation activities during the 2019-20 fiscal year

    Activities undertaken during the year to address risks related to control deficiencies noted during the design effectiveness testing include:

    • Practices related to FAA Section 34 approval for timesheets and overtime were strengthened;
    • Personnel files were reviewed for completeness and missing documentation obtained;
    • Concise guidance on the various procurement methods was developed and incorporated into the updated Supporting Notes to the Delegation of Spending and Financial Signing Authorities Chart;
    • A Departmental Security Plan was developed and approved by the President;
    • POLAR’s first compliance audits of contribution recipients were conducted by a third party service provider; and
    • A Manager, IM/IT was hired.
  1. Assessment plan

    POLAR intends to conduct operational effectiveness testing of the controls referred to in Section 1 in fiscal year 2020-21 however this timeline may be revised should an ongoing requirement for its workforce to continue to work remotely as a result of the COVID-19 pandemic preclude the testing from happening as planned.

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