PrairiesCan 2023–2024 Financial Statements (unaudited) for the year ended March 31, 2024

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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, 2024, and all information contained in these financial statements rests with the management of Prairies Economic Development Canada (PrairiesCan). These financial statements have been prepared by management using the Government of Canada’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 PrairiesCan’s financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in PrairiesCan’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 PrairiesCan 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 on-going process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

PrairiesCan is subject to periodic Core Control Audits performed by the Office of the Comptroller General and uses the results of such audits to comply with the Treasury Board Policy on Financial Management.

In the interim, PrairiesCan has undertaken a self-assessment of the system of ICFR for the year ended March 31, 2024, in accordance with the Treasury Board Policy on Financial Management, and the results are summarized in the annex.

The financial statements of PrairiesCan have not been audited.

 

 

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Statement of Financial Position (Unaudited)
As at March 31

(in dollars)

Statement of Financial Position (Unaudited) as at March 31

	2024	2023
Liabilities
Accounts payable and accrued liabilities (note 4)	$ 140,396,946	$ 208,796,160
Vacation pay and compensatory leave	2,246,670	2,496,510
Employee future benefits (note 5)	591,891	623,226
Total gross liabilities	143,235,507	211,915,896
Total net liabilities	143,235,507	211,915,896
Financial assets
Due from Consolidated Revenue Fund	140,329,449	208,552,987
Accounts receivable and advances (note 6)	3,890,108	384,239
Loans receivable (note 7)	361,209,122	393,719,868
Total gross financial assets	505,428,679	602,657,094
Financial assets held on behalf of Government
Accounts receivable and advances (note 6)	(3,822,825)	(117,915)
Loans receivable (note 7)	(361,209,122)	(393,719,868)
Total financial assets held on behalf of Government	(365,031,947)	(393,837,783)
Total net financial assets	140,396,732	208,819,311
Departmental net debt	2,838,775	3,096,585
Non-financial assets
Prepaid expenses	45,686	62,905
Tangible capital assets (note 8)	1,441,637	1,722,462
Total non-financial assets	1,487,323	1,785,367
Departmental net financial position	$ (1,351,452)	$ (1,311,218)
Contractual obligations (note 9) The accompanying notes form an integral part of these financial statements.

 

 

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Statement of Operations and Departmental Net Financial Position (Unaudited)
For the Year Ended March 31

(in dollars)

Statement of Operations and Departmental Net Financial Position (Unaudited) For the Year Ended March 31

	2024 Planned Results	2024	2023
Expenses
Community Initiatives	$ 108,122,538	$ 142,804,584	$ 195,348,334
Innovation	120,856,036	89,098,499	81,326,304
Business Services	29,746,245	33,171,915	32,771,889
Business Growth	16,607,702	31,973,839	77,572,936
Internal Services	17,570,988	19,972,508	20,239,535
Expenses incurred on behalf of Government	40,848,433	(12,532,957)	(30,596,489)
Total expenses	333,751,942	304,488,388	376,662,509
Revenues
Amortization of discount	8,873,501	6,207,750	3,364,807
Services to other government departments	2,591,785	4,083,683	2,666,542
Interest	583,954	783,001	426,951
Other	352	13,355	14,764
Revenues earned on behalf of Government	(12,049,267)	(11,087,789)	(6,472,884)
Total revenues	325	0	180
Net cost of operations before government funding and transfers	333,751,617	304,488,388	376,662,329
Government funding and transfers
Net cash provided by Government of Canada		366,991,957	293,599,871
Change in due from Consolidated Revenue Fund		(68,223,538)	77,919,327
Services provided without charge by other government departments (note 12)		5,667,284	5,368,334
Transfer of assets and liabilities from other government departments (note 13)		12,451	22,920
Net cost of operations after government funding and transfers		40,234	(248,123)
Departmental net financial position — Beginning of year		(1,311,218)	(1,559,341)
Departmental net financial position — End of year		$ (1,351,452)	$ (1,311,218)
Segmented information (note 14) 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)

Statement of Change in Departmental Net Debt (Unaudited) For the Year Ended March 31

	2024	2023
Net cost of operations after government funding and transfers	$ 40,234	$ (248,123)
Change due to tangible capital assets
Acquisition of tangible capital assets	0	46,027
Amortization of tangible capital assets	(280,825)	(255,549)
Total change due to tangible capital assets	(280,825)	(209,522)
Change due to prepaid expenses	(17,219)	62,905
Net increase (decrease) in departmental net debt	(257,810)	(394,740)
Departmental net debt - Beginning of year	3,096,585	3,491,325
Departmental net debt - End of year	$ 2,838,775	$ 3,096,585
The accompanying notes form an integral part of these financial statements.

 

Statement of Cash Flows (Unaudited)
For the Year Ended March 31

(in dollars)

Statement of Cash Flows (Unaudited) For the Period Ended March 31

	2024	2023
Operating activities
Net cost of operations before government funding and transfers	$ 304,488,388	$ 376,662,329
Non-cash items:
Amortization of tangible capital assets	(280,825)	(255,549)
Services provided without charge by other government departments (note 12)	(5,667,284)	(5,368,334)
Variations in Statement of Financial Position:
Increase (decrease) in accounts receivable and advances	(199,041)	193,897
Increase (decrease) in prepaid expenses	(17,219)	62,905
Decrease (increase) in accounts payable and accrued liabilities	68,399,214	(78,089,741)
Decrease (increase) in vacation pay and compensatory leave	249,840	150,422
Decrease (increase) in employee future benefits	31,335	220,835
Transfer of assets from other government departments (note 13)	(12,451)	(22,920)
Cash used in operating activities	366,991,957	293,553,844
Capital investing activities
Acquisitions of tangible capital assets	0	46,027
Cash used in capital investing activities	0	46,027
Net cash provided by Government of Canada	$ 366,991,957	$ 293,599,871
The accompanying notes form an integral part of these financial statements.

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Notes to the Financial Statements (Unaudited)
For the Year Ended March 31

1. Authority and Objectives

Western Economic Diversification Canada (WD) was established in 1987 to promote growth and diversification in the economy of the West. In August 2021, WD’s operating name was changed to Prairies Economic Development Canada (PrairiesCan). PrairiesCan promotes the economic growth and diversification in the economy of the prairie provinces (Alberta, Saskatchewan and Manitoba). PrairiesCan also advances the interests of the prairie provinces in national economic policy, program and project development and implementation. The Minister of Northern Affairs is responsible for PrairiesCan.

PrairiesCan’s mandate, enabled by the Western Economic Diversification Act, is to grow and diversify the economy of the Prairies and to advance the interests of western Canada in national economic policy, program and project development and implementation. This broad mandate allows the department to deliver a wide range of initiatives across the Prairies and make strategic investments to build on regional competitive advantages. PrairiesCan also contributes to Government of Canada priorities and ministerial mandate letter commitments.

PrairiesCan builds upon the foundation created by WD. Since 2011, the department has touched nearly 1,000 communities, over 6,300 for-profits, over 3,800 not-for-profits, and supported 290,000 jobs. PrairiesCan has recently expanded its presence with more locations across the Prairies and a strengthened approach to economic development.

This focus on the Prairies enables the department to foster strong partnerships with business and community organizations, research and academic institutions, Indigenous Peoples, and provincial and municipal governments. These connections help PrairiesCan reflect Prairie perspectives in national decision-making.

PrairiesCan is strengthening its four roles in the service of businesses and communities in Manitoba, Saskatchewan, and Alberta. These four roles are:

• Investor: create jobs and growth through strategic investments and targeted initiatives
• Convenor: connect economic actors to support collaboration and growth
• Advisor: inform economic decision-making and advocate for Prairie interests
• Pathfinder: help people navigate federal economic programs and services

We are proud to be able to assist the people of the Prairies to grow, transform, and achieve long-term success.

PrairiesCan promotes growth and diversification in the economy of the Prairies (Alberta, Saskatchewan and Manitoba) by enhancing innovation, improving business competitiveness, promoting the adoption of clean technologies, and inclusive growth.

PrairiesCan’s core responsibility, Economic Development in the Prairies, is complemented by three improved departmental results:

1. Businesses are growing in the Prairies;
2. Communities are developing economically in the Prairies; and
3. Businesses are commercializing technology and adopting it in the Prairies.

PrairiesCan’s strategic outcome is advanced through the following programs:

• Innovation: Prairie businesses are innovative;
• Business Growth: Prairie businesses are competitive and export their products/services;
• Business Services: Prairie businesses have access to advisory services and capital;
• Community Initiatives: Prairie community economic development is supported; and
• Internal Services: Effective and efficient support for advancing the department’s strategic outcome.

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2. Summary of significant accounting policies

These financial statements are prepared using the department’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:

1. Parliamentary authorities
   PrairiesCan is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to PrairiesCan 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” sections of the Statement of Operations and Departmental Net Financial Position are the amounts reported in the Future-oriented Statement of Operations included in the 2023–2024 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 2023–2024 Departmental Plan.
    
2. Net cash provided by Government
   PrairiesCan operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by PrairiesCan is deposited to the CRF, and all cash disbursements made by PrairiesCan 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.
    
3. Amounts due from or to the CRF
   Amounts due from or to 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 PrairiesCan is entitled to draw from the CRF without further authorities to discharge its liabilities.
    
4. Revenues
   Revenues are comprised of revenues earned from non-tax sources. They include exchange transactions where goods or services are provided for consideration where a performance obligation exists, and non-exchange transactions where no performance obligations exist to provide a good or service. These transactions can be recurring or non-recurring in nature. Recurring transactions are viewed as ongoing, routine activities that form part of the normal course of operations and can be used to indicate if they can be reasonably expected to be earned again in future years.
   
   Revenues are recognized in the period the event giving rise to the revenues occurred.
   
   Revenues that are non-respendable are not available to discharge PrairiesCan’s liabilities. While the Departmental Deputy Head is expected to maintain accounting control, she has no authority regarding 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 the entity’s gross revenues. Revenues earned on behalf of Government consist of the sale of services and gains on the sale of assets. These are recognized when earned.
    
5. 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.
   
   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 accommodation, employer contributions to the health and dental insurance plans, legal services and workers’ compensation are recorded as operating expenses at their carrying value.
    
6. Employee future benefits
    
   1. Pension benefits: Eligible employees participate in the Public Service Pension Plan (The Public Service Superannuation Act), a multiemployer pension plan administered by the Government. PrairiesCan’s contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. PrairiesCan’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.
       
   2. 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.
       
7. Financial Instruments
   A contract establishing a financial instrument creates, at its inception, rights, and obligations to receive or deliver economic benefits. The financial assets and financial liabilities portray these rights and obligations in the financial statements. The Department recognizes a financial instrument when it becomes a party to a financial instrument contract.
   
   Financial instruments consist of accounts and loans receivable, and accounts payable and accrued liabilities.
   
   All financial assets and liabilities are recorded at cost or amortized cost. Any associated transaction costs are added to the carrying value upon initial recognition. For financial instruments measured at amortized cost, the effective interest method is used to determine interest revenue or expense.
   
   See Note 11 Risk Management for risks related to Prairiecan’s financial instruments.
   
   Accounts and loans receivable are initially recorded at cost and where necessary, are discounted to reflect their concessionary terms. Concessionary terms of loans include cases where loans are made on a long-term, low interest or interest-free basis or include forgiveness clauses. Unconditionally repayable contributions are recognized as loans receivable. When necessary, an allowance for valuation is recorded to reduce the carrying value of accounts and loans receivable to amounts that approximate their net recoverable value. Loans receivable are subsequently measured at amortized cost.
    
8. 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 8. 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.
    
9. Contingent liabilities
   Contingent liabilities, including the allowance for guarantees, 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.
   
   For guarantees, an allowance is recorded when it is determined that a loss is likely and the amount of the allowance is estimated taking into consideration the nature of the guarantee, loss experience and current conditions. The allowance is reviewed on an ongoing basis and changes in the allowance are recorded as expenses in the year they become known.
    
10. Contingent assets
    Contingent assets are possible assets which may become actual assets when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, the contingent asset is disclosed in the notes to the financial statements.
     
11. 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 allowance for doubtful accounts, the liability for employee future benefits, the useful life of tangible capital assets and unamortized discount related to unconditionally repayable contributions.
    
    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.
     
12. 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:
     
    1. Services provided on a recovery basis are recognized as revenues and expenses on a gross basis and measured at the exchange amount.
        
    2. Certain services received on a without charge basis are recorded for departmental financial statement purposes at the carrying amount.
        

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3. Parliamentary authorities

PrairiesCan receives most of 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, PrairiesCan 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

 

Reconciliation of net cost of operations to current year authorities used

	2024	2023
	(in dollars)
Net cost of operations before government funding and transfers	$ 304,488,388	$ 376,662,329
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets	(280,825)	(255,549)
Services provided without charge by other government departments	(5,667,284)	(5,368,334)
Decrease (increase) in vacation pay and compensatory leave	249,840	150,422
Decrease (increase) in employee future benefits	31,335	220,835
Decrease (increase) in accrued liabilities not charged to authorities	5,917,875	2,301,680
Refund of prior years’ expenditures	1,962,029	2,731,456
Services to other government departments	(4,083,683)	(2,666,542)
Other	601,134	419,358
Total items affecting net cost of operations but not affecting authorities	(1,269,579)	(2,466,674)
Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisitions of tangible capital assets	0	46,027
Unconditionally repayable transfer payments	74,395,472	125,101,220
Increase in employee advances	10,472	2,215
Increase (decrease) in prepaid expenses	(17,219)	62,905
Total items not affecting net cost of operations but affecting authorities	74,388,725	125,212,367
Current year authorities used	$ 377,607,534	$ 499,408,022

(b) Authorities provided and used

Authorities provided and used

	2024	2023
	(in dollars)
Authorities provided:
Vote 1 - Operating expenditures	$ 49,320,994	$ 51,752,430
Vote 5 - Transfer payments	374,975,943	529,226,790
Statutory amounts	5,456,533	5,310,338
Less:
Lapsed: Operating	(4,615,913)	(3,914,267)
Lapsed: Transfer payments	(47,530,023)	(82,967,269)
Current year authorities used	$ 377,607,534	$ 499,408,022

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4. Accounts payable and accrued liabilities

The following table presents details of PrairiesCan’s accounts payable and accrued liabilities:

Accounts payable and accrued liabilities

	2024	2023
	(in dollars)
Accounts payable - Other government departments and agencies	$ 1,063,496	$ 826,962
Accounts payable - External parties	135,608,551	204,812,002
Total accounts payable	136,672,047	205,638,964
Accrued liabilities	3,724,899	3,157,196
Total accounts payable and accrued liabilities	$ 140,396,946	$ 208,796,160

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5. Employee future benefits

(a) Pension benefits

PrairiesCan’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/Québec Pension Plan benefits and they are indexed to inflation.

Both the employees and PrairiesCan contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to Economic Action Plan 2012, employee contributors have been divided into two groups – Group 1 related 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 2023–2024 expense amounts to $3,230,814 ($3,469,127 in 2022–2023). For Group 1 members, the expense represents approximately 1.02 times (1.02 times in 2022–2023) the employee contributions and, for Group 2 members, approximately 1.00 times (1.00 times in 2022–2023) the employee contributions.

PrairiesCan’s responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the Consolidated Financial Statements of the Government of Canada, as the Plan’s sponsor.

(b) Severance benefits

Severance benefits provided to PrairiesCan’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, 2018, 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:

Accrued benefit obligation - Beginning of year

	2024	2023
	(in dollars)
Accrued benefit obligation - Beginning of year	$ 623,226	$ 844,061
Expense for the year	4,159	(126,951)
Benefits paid during the year	(35,494)	(93,884)
Accrued benefit obligation - End of year	$ 591,891	$ 623,226

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6. Accounts receivable and advances

The following table presents details of PrairiesCan’s accounts receivable and advances balances:

Accounts receivable and advances

	2024	2023
	(in dollars)
Receivables - Other government departments and agencies	$ 44,146	$ 233,615
Receivables - External parties	3,822,611	141,066
Employee advances	23,351	9,558
Gross accounts receivable	$ 3,890,108	$ 384,239
Accounts receivable held on behalf of Government	(3,822,825)	(117,915)
Net accounts receivable	$ 67,283	$ 266,324

Employee advances totalling $12,451 were transferred from other government departments to PrairiesCan during 2023–2024 ($22,920 in 2022–2023). Refer to note 13 for further details.

The following table provides an aging analysis of accounts receivable from external parties and the associated valuation allowances used to reflect their net recoverable value.

Accounts receivable from external parties	2024	2023
	(in dollars)
Not past due	$ 3,688,277	$ 139,058
Number of days past due
1 to 30	133,952	0
61 to 90	0	1,840
Over 365	168	168
Total	$ 3,822,611	$ 141,066

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7. Loans receivable

The following table presents details of PrairiesCan’s loans and unconditionally repayable contribution balances:

Loans receivable

	2024	2023
	(in dollars)
Loans receivable
Unconditionally repayable contributions	$ 673,875,531	$ 702,093,796
Accrued interest - unconditionally repayable transfer payments	2,326,043	997,303
Less: Unamortized discount	(53,710,489)	(50,112,466)
Subtotal	622,491,085	652,978,633
Transfer payments recoverable	3,156,913	1,631,483
Subtotal	625,647,998	654,610,116
Less: Allowance for uncollectibility	(264,438,876)	(260,890,248)
Gross loans receivable	361,209,122	393,719,868
Loans receivable held on behalf of Government	(361,209,122)	(393,719,868)
Net loans receivable	$ 0	$ 0

Unconditionally repayable contributions

The unconditionally repayable contributions portfolio consists of 2,915 non-interest-bearing loans issued in the years from 2010 to 2024, with prescribed repayment terms. The loans are recorded at their discounted net present values using market interest rates at the time of the loans. An allowance of $260,205,491 ($259,296,761 in 2022–2023) has been recorded.

With respect to interest charged on unconditionally repayable transfer payments, an allowance of $1,350,437 ($535,977 in 2022–2023) has been recorded.

Transfer payments recoverable

Transfer payments recoverable relate to payments made to outside parties which are repayable based on conditions specified in the contribution agreement that have come into being. An allowance of $2,882,948 ($1,057,510 in 2022–2023) has been recorded.

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8. Tangible capital assets

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

Tangible capital assets

Asset Class	Amortization Period
Machinery and equipment	10 years
Computer software	7 years
Leasehold improvements	Lesser of the remaining term of lease or useful life of the improvement

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9. Contractual obligations

The nature of PrairiesCan’s activities may result in some large multi-year contracts and obligations whereby PrairiesCan 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:

 

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10. Revenues

PrairiesCan has the following major types of revenues: Amortization of discount, services to other government departments, interest, other and revenues earned on behalf of the Government. Amortization of discount, interest, other fees and charges and miscellaneous revenues are recorded when they are earned. Services to other government departments and gain on disposal of non-capital assets are recorded when the performance obligations are satisfied.

(a) Disaggregated revenues

	2024	2023
	(in dollars)
Revenues
Amortization of discount (non-exchange)	$6,207,750	$3,364,807
Services to other government departments (exchange)	4,083,683	2,666,542
Interest (non-exchange)	783,001	426,951
Other
Other fees and charges (exchange and non-exchange)	13,355	14,580
Gain on disposal of non-capital assets (exchange)	0	180
Miscellaneous (non-exchange)	0	4
Total other	13,355	14,764
Revenues earned on behalf of Government (exchange and non-exchange)	(11,087,789)	(6,472,884)
Total revenues	$ 0	$180

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11. Risk management

PrairiesCan has exposure to the following risks from its use of financial instruments: credit risk, market risk and liquidity risk.

(a) Credit Risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss. PrairiesCan’s maximum exposure to credit risk at March 31, 2024 and March 31, 2023 is the carrying amount of its financial assets. PrairiesCan has determined that there is no significant concentration of credit risk related to accounts receivable from external parties. An analysis of the age of these financial assets and the associated valuation allowances used to reflect these accounts at their net recoverable value is disclosed in Note 6. PrairiesCan intentionally takes on counterparty risk related to certain loans receivable with concessionary terms in order to support various policy aims. Valuation allowances are applied accordingly to reflect these accounts at their net recoverable value, as explained in Note 7.

(b) Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk is comprised of currency risk, interest rate risk and other price risk.

i) Currency Risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in the foreign exchange rates. PrairiesCan has determined that there is no significant concentration of currency risk related to foreign denominated financial instruments.

ii) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. PrairiesCan’s unconditional repayable contributions and transfer payments recoverable are non-interest bearing instruments. Although the fair value of these financial instruments will be affected by changes in market interest rates, there is no impact on PrairiesCan’s financial statements as these items are measured at cost or amortized cost.

(c) Liquidity Risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting its obligations associated with financial liabilities.

As the funding for PrairiesCan’s financial liabilities is drawn from the Consolidated Revenue Fund, its exposure to liquidity risk is fully mitigated.

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12. Related party transactions

PrairiesCan 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.

PrairiesCan 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, PrairiesCan received services without charge from certain common service organizations, related to accommodation and the employer’s contribution to the health and dental insurance plans. These services provided without charge have been recorded at the carrying value in PrairiesCan’s Statement of Operations and Departmental Net Financial Position as follows:

Common services provided without charge by other government departments

	2024	2023
	(in dollars)
Employer’s contribution to the health and dental insurance plans	$ 3,524,694	$ 3,378,821
Accommodation	2,142,590	1,989,513
Total	$ 5,667,284	$ 5,368,334

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 and audit services provided by the Office of the Auditor General are not included in PrairiesCan’s Statement of Operations and Departmental Net Financial Position.

(b) Administration of programs on behalf of other government departments

Under separate interdepartmental letters of agreement signed with the Department of Indigenous Services Canada (ISC) on September 22, 2022, April 28, 2023 and July 6, 2023, PrairiesCan administers the Strategic Partnerships Initiative for Indigenous communities to participate in developing clean energy and critical minerals. During the year, PrairiesCan incurred expenses of $752,450 ($0 in 2022-2023) for the clean energy initiative and $1,693,383 ($0 for 2022-23) for the critical minerals partnerships initiative. These expenses are reflected in the financial statements of ISC and are not recorded in these financial statements.

Administration of programs on behalf of other government departments

	2024	2023
	(in dollars)
Strategic Partnerships Initiative	$ 2,445,833	$ 0
Total	$ 2,445,833	$ 0

(c) Other transactions with other government departments and agencies

Other transactions with other government departments and agencies

	2024	2023
	(in dollars)
Accounts receivable	$ 44,146	$ 233,615
Accounts payable	1,063,496	826,962
Expenses	1,384,685	2,336,933
Revenues	4,083,683	2,666,542

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

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13. Transfers from/to other government departments

Transfers from/to other government departments

	2024	2023
	(in dollars)
Assets:
Accounts receivable and advances (note 6)
Transferred from Indigenous Services Canada	$ (6,258)	$ (7,758)
Transferred from Environment and Climate Change Canada	(3,262)	0
Transferred from Canada Energy Regulator	(700)	0
Transferred from House of Commons Canada	(690)	0
Transferred from Employment and Social Development Canada	(524)	(2,485)
Transferred from Public Safety Canada	(503)	0
Transferred from Canada Border Services Agency	(462)	0
Transferred from Correctional Service Canada	(210)	0
Transferred from Veterans Affairs Canada	0	(12,373)
Transferred from Federal Economic Development Agency for Southern Ontario	0	(58)
Transferred to Canadian Heritage	0	3
Transferred to Canadian Radio-television and Telecommunications Commission	0	13
Transferred to Agriculture and Agri-Food Canada	18	0
Transferred to Innovation, Science and Economic Development Canada	140	(262)
Adjustment to the departmental net financial position	$ (12,451)	$ (22,920)

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14. Segmented information

Presentation by segment is based on PrairiesCan’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 generated for the main core responsibilities, by major object of expense and by major type of revenue. The segment results for the period are as follows:

Summary of the assessment of effectiveness of the systems of internal control over financial reporting and the action plan of Prairies Economic Development Canada for fiscal year 2023–2024 (unaudited)

Annex to the Statement of Management Responsibility lncluding lnternal Control Over Financial Reporting (unaudited)

1. Introduction
In support of an effective system of internal control, Prairies Economic Development Canada (PrairiesCan) annually assesses the performance of its financial controls to ensure that:

• financial arrangements or contracts are entered into only when sufficient funding is available
• payments for goods and services are made only when the goods or services have been received or the conditions of contracts or other arrangements have been satisfied
• payments have been properly authorized

PrairiesCan will leverage the results of planned self-assessment exercises in addition to any of the periodic core control audits performed by the Office of the Comptroller General. Below is a summary of the results of the self-assessment conducted during the 2023 to 2024 fiscal year.

2. Assessment results for the 2023 to 2024 fiscal year
For the most part, controls related to payment for goods and services and payment authority were functioning well and form an adequate basis for the department’s system of internal control.

In the current year there were no significantly amended key controls which required a reassessment.

The department conducted on-going monitoring as follows:

• Completed as planned and remedial actions partially commenced – Contracting, Receivables Management and Year-end Payables.
• Action plans will be completed by December 31, 2024 .

3. Assessment plan
PrairiesCan will continue to monitor the performance of its system of internal control, with a focus on the core controls related to financial transactions.  The department will address items identified for remedial action.