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2009-10 Financial Statements (DPR)

Statement of Management Responsibility

Office of the Public Sector Integrity Commissioner of Canada

Responsibility for the integrity and objectivity of the accompanying financial statements of the Office of the Public Sector Integrity Commissioner of Canada (the Office) for the year ended March 31, 2010 and all information contained in these statements rests with Office’s management. These financial statements have been prepared by management in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

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 fulfil its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the Office’s financial transactions.  Financial information submitted to the Public Accounts of Canada and included in the Office’s Departmental Performance Report is consistent with these financial statements.

Management maintains a system of financial management and internal control designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are in accordance with the Financial Administration Act and regulations and the Public Servants Disclosure Protection Act, are executed in accordance with prescribed regulations, are within Parliamentary authorities, and are properly recorded to maintain accountability of Government funds.  Management also seeks to ensure the objectivity and integrity of data in its financial statements by careful selection, training and development of qualified staff, by organizational arrangements that provide appropriate divisions of responsibility, and by communication programs aimed at ensuring that regulations, policies, standards and managerial authorities are understood throughout the Office.

The Office’s financial statements have been audited by the Auditor General of Canada, the independent auditor for the Government of Canada.

 

Christiane Ouimet
Public Sector Integrity Commissioner
of Canada
 France Duquette
Special Advisor and Chief Financial Officer

Ottawa, Canada
June 4, 2010

 

Auditor's Report

To the Speaker of the House of Commons and the Speaker of the Senate

I have audited the statement of financial position of the Office of the Public Sector Integrity Commissioner of Canada as at 31 March 2010 and the statements of operations, equity of Canada and cash flow for the year then ended. These financial statements are the responsibility of the Office’s management. My responsibility is to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with Canadian generally accepted auditing standards. Those standards require that I plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.

In my opinion, these financial statements present fairly, in all material respects, the financial position of the Office as at 31 March 2010 and the results of its operations and its cash flows for the year then ended in accordance with Canadian generally accepted accounting principles.

Further, in my opinion, the transactions of the Office that have come to my notice during my audit of the financial statements have, in all significant respects, been in accordance with the Financial Administration Act and regulations and the Public Servants Disclosure Protection Act.

Sheila Fraser, FCA
Auditor General of Canada

Ottawa, Canada
4 June 2010

 

Statement of Financial Position

Office of the Public Sector Integrity Commissioner of Canada

As at March 31

(in dollars)

20102009
Assets
Financial Assets  
Due from the Consolidated Revenue Fund38,069 136,556
Accounts receivable and advances (note 4)150,292237,191
Total Financial Assets188,361 373,747
   
Non-Financial Assets  
Tangible capital assets (note 5)104,421 89,114
Total Assets292,782 462,861
   
Liabilities  
Accounts payable and accrued liabilities (note 6)187,234 369,400
Vacation pay and compensatory leave107,400 188,847
Employee severance benefits (note 7b)409,200471,341
Total Liabilities703,8341,029,588
   
Equity of Canada(411,052)(566,727)
Total Liabilities and Equity of Canada292,782 462,861
Contractual obligations (note 10)

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


Christiane Ouimet
Public Sector Integrity Commissioner
of Canada
 France Duquette
Special Advisor and Chief Financial Officer

 

 

Statement of Operations

Office of the Public Sector Integrity Commissioner of Canada

For the year ended March 31

(in dollars)

20102009
Operating Expenses
Salaries, wages and benefits2,437,777 2,695,933
Professional and special services1,067,494889,725
Accommodation259,100278,600
Information93,299140,240
Travel and relocation42,498 85,568
Communication39,404 48,682
Rentals38,80815,545
Utilities, material and supplies20,457 40,861
Equipment expenses18,97811,746
Amortization of tangible capital assets17,988 17,988
Repairs and maintenance8,9592,674
Total Operating Expenses4,044,762 4,227,562
   
Revenues  
Revenues-30
Net Cost of Operations4,044,762 4,227,532

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

 

 

Statement of Equity of Canada

Office of the Public Sector Integrity Commissioner of Canada

For the year ended March 31

(in dollars)

20102009
Equity of Canada, beginning of year(566,727)(453,358)
Net cost of operations(4,044,762)(4,227,532)
Net cash provided by Government of Canada3,768,8243,896,092
Change in due from the Consolidated Revenue Fund(98,487)(410,829)
Services received without charge from other government departments (note 9)530,100 628,900
Equity of Canada, end of the year(411,052)(566,727)

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

 

 

Statement of Cash Flow

Office of the Public Sector Integrity Commissioner of Canada

For the year ended March 31

(in dollars)

20102009
Operating Activities
Net Cost of Operations4,044,762 4,227,532
   
Non-cash items included in Net Cost of Operations:  
Amortization of tangible capital assets (note 5)(17,988)(17,988)
Services received without charge from other government departments (note 9)(530,100)(628,900)
   
Variations in Statement of Financial Position:  
(Decrease) Increase in accounts receivable and advances(86,899)199,405
Decrease in accounts payable and accrued liabilities 182,166215,771
Decrease in vacation pay and compensatory leave81,44768,000
Decrease (Increase) in employee severance benefits 62,141(167,728)
Cash Used by Operating Activities3,735,5293,896,092
   
Capital Investment Activities  
Acquisitions of tangible capital assets (note 5)33,295 -
Cash Used by Capital Investment Activities33,295 -
Net Cash Provided by Government of Canada3,768,824 3,896,092

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

 

 

Notes to the Financial Statements

Office of the Public Sector Integrity Commissioner of Canada

1. Authority and Objective

The Office of the Public Sector Integrity Commissioner of Canada (the Office) was created under the Public Servants Disclosure Protection Act, which came into force on April 15, 2007. The Integrity Commissioner is an independent officer of Parliament appointed by the Governor-in-Council following approval for her nomination by resolution of the Senate and the House of Commons. The Office is established under the authority of Schedule I.1 of the Financial Administration Act and is funded through annual appropriations. The Commissioner is accountable for, and reports directly to Parliament on the results achieved.

The Office has the mandate to establish a safe, confidential mechanism for public servants or members of the public to disclose potential wrongdoing in the public sector. The Office also protects the public servants from reprisal for making such disclosures or participating in investigations.

2. Summary of Significant Accounting Policies

(a) Basis of presentation

The financial statements have been prepared in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

(b) Parliamentary appropriations

The Office is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the Office do not parallel financial reporting according to Canadian generally accepted accounting principles for the public sector since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the Statement of Operations and the Statement of Financial Position are not necessarily the same as those provided through appropriations from Parliament. Note 3 provides a high-level reconciliation between the bases of reporting.

(c) Due from the Consolidated Revenue Fund

The Office operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the Office is deposited to the CRF and all cash disbursements made by the Office are paid from the CRF. Due from the Consolidated Revenue Fund represents amounts of cash that the Office is entitled to draw from the CRF, without further appropriations, in order to discharge its liabilities. The net cash provided by Government is the difference between all cash receipts and all cash disbursements including transactions between departments of the federal government.

(d) Accounts receivable

Accounts receivable are stated at amounts expected to be ultimately realized. A provision is made for accounts receivable where recovery is considered uncertain.

(e) Tangible capital assets

Tangible capital assets and leasehold improvements having an initial cost of $5,000 or more are recorded at their acquisition cost. The Office does not capitalize intangibles. Amortization of tangible capital assets is done on a straight line basis over their estimated useful lives, as follows:

Tangible capital asset classAmortization period
Informatics hardware3 to 5 years
Informatics software3 to 5 years
Other equipment1 to 15 years
Leasehold improvementsLesser of the remaining term of the lease or useful life of the improvement

Amortization of the tangible capital asset commences the month following the asset is put into service.

(f) Salaries and benefits, and vacation leave

Salaries and benefits, and vacation leave are expensed as they accrue to employees under their respective terms of employment. The employee salaries and benefits liability is calculated based on the respective terms of employment using the employees’ salary levels at year end, and the number of days remaining unpaid at the end of the year. The liability for vacation leave is calculated at the salary levels in effect at March 31st for all unused vacation leave benefits accruing to employees. Employee vacation pay liabilities payable on cessation of employment represent obligations of the Office that are normally funded through future years’ appropriations.

(g) Employee future benefits

√ Pension benefits
Eligible employees participate in the Public Service Pension Plan, a multiemployer plan administered by the Government of Canada.  The Office’s contributions to the Plan are charged to expenses in the year incurred and represent the total Office obligation to the Plan.  Current legislation does not require the Office to make contributions for any actuarial deficiencies of the Plan.

√ Severance benefits
Employees are entitled to severance benefits under collective agreements or conditions of employment.  These benefits are accrued as employees render the services necessary to earn them.  The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.

(h) Revenues

Revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.

(i) Services received without charge by other government departments

Services received without charge from other government departments and agencies are recorded as operating expenses at their estimated cost. A corresponding amount is reported directly in the Statement of Equity of Canada.

(j) Measurement uncertainty

The preparation of these financial statements in accordance with Treasury Board accounting policies, which are consistent with Canadian generally accepted accounting principles for the public sector, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. The liability for employee severance benefits and the estimated useful life of tangible capital assets are the most significant items where estimates are used. 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.

3. Parliamentary Appropriations

The Office receives most of its funding through annual Parliamentary appropriations.  Items recognized in the Statement of Operations and the Statement of Financial Position in one year may be funded through Parliamentary appropriations in prior, current or future years.  Accordingly, the Office has different net results of operations for the year on a government funding basis than on an accrual accounting basis.  The following tables present the reconciliation between the current year appropriations used, the net cost of operations and the net cash provided by the Government:

(a) Reconciliation of net cost of operations to current year appropriations used:
(in dollars) 20102009
Net cost of operations4,044,762 4,227,532
   
Items affecting net cost of operations but not affecting appropriations:  
Services received without charge from other government departments (note 9)(530,100)(628,900)
Amortization of tangible capital assets(17,988)(17,988)
Revenue not available for spending38 1,330
Variation in vacation pay and compensatory leave81,44768,000
Variation in employee severance benefits62,141(167,728)
Adjustments to previous year’s expenses173,591128,446
 (230,871)(616,840)
Items not affecting net cost of operations but affecting appropriations:  
Advance - employees(2,555)-
Acquisitions of tangible capital assets33,295-
 30,740-
Current Year Appropriations Used3,844,6313,610,692

 

 

(b) Appropriations provided and used:
(in dollars)20102009
Program expenditures - Vote 506,347,8636,113,998
Statutory - Contributions to employee benefits plan363,431330,997
 6,711,2946,444,995
Lapsed(2,866,663)(2,834,303)
Current Year Appropriations Used3,844,6313,610,692

 

 

(c) Reconciliation of net cash provided by Government to current year appropriations used:
(in dollars)20102009
Net cash provided by Government3,768,8243,896,092
Revenue not available for spending38 1,330
Decrease (Increase) in accounts receivable and advances84,344(199,405)
Decrease in accounts payable and accrued liabilities(182,166)(215,771)
Adjustments to previous year’s expenses173,591 128,446
Current Year Appropriations Used3,844,6313,610,692

 

 

4. Accounts Receivable and Advances

(in dollars)20102009
Accounts receivable
Other government departments149,165232,844
External parties127792
 149,292233,636
Advances
Employees-2,555
Petty cash1,000 1,000
 1,0003,555
 150,292237,191

 

 

5. Tangible Capital Assets

Tangible capital assets
(in dollars)
Balance beginning of yearAcquisitionsDisposals /
write-offs Adjustments
Balance end of year
Informatics hardware10,723 --10,723
Informatics software- 33,295-33,295
Other equipment22,758 --22,758
Leasehold improvements83,375 --83,375
 116,856 33,295-150,151

 

Accumulated amortization
(in dollars)
Balance beginning of year AmortizationDisposals /
write-offs Adjustments
Balance end of year
Informatics hardware2,1452,145 -4,290
Informatics software- ---
Other equipment5,185 3,457 -8,642
Leasehold improvements20,41212,386 -32,798
 27,74217,988 -45,730

 

Net book value
(in dollars)
20102009
Informatics hardware6,4338,578
Informatics software33,295-
Other equipment14,11617,573
Leasehold improvements50,57762,963
 104,421 89,114

 

 

6. Accounts Payable and Accrued Liabilities

(in dollars)20102009
External parties  
Accounts payable and accrued liabilities136,337167,963
Accrued salaries-53,617
Other government departments  
Accounts payable50,897147,820
 187,234369,400

 

 

7. Employee Future Benefits

(a) Pension benefits

The Office’s eligible employees participate in the Public Service Pension Plan, which is sponsored and administered by the Government of Canada.  Pension benefits accrue up to 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 the Canada and Quebec Pension Plans benefits and they are indexed to inflation.

Both the employees and the Office contribute to the cost of the Plan.  In 2009-10, the expenses amount to $262,397 ($238,980 in 2008-09), which represents approximately 1.9 times (2.0 in 2008-09) the employees’ contributions.

The Office’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

The Office provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information about the severance benefits, measured as at March 31, is as follows:

(in dollars)20102009
Liability for employee severance benefits, beginning of year471,341303,613
Expense for the year(62,141) 167,728
Benefits paid during the year--
Liability for employee severance benefits, end of year409,200 471,341

 

8. Related Party Transactions

The Office is related as a result of common ownership to all Government of Canada departments, agencies and Crown corporations. The Office enters into transactions with these entities in the normal course of business and on normal trade terms.

During the year, the Office incurred expenses of $1,544,973 ($1,994,743 in 2008-09) from transactions in the normal course of business with other Government departments, agencies and Crown corporations. These expenses include services received without charge of $530,100 ($628,900 in 2008-09) as described in note 9.

9. Services received without charge from other government departments

During the year, the Office received services without charge from other departments, which are recorded at their estimated cost in the Statement of Operations as follows:

(in dollars) 20102009
Accommodation provided by Public Works and Government Services Canada259,100 278,600
Employer’s contribution to the health and dental insurance plans and expenditures paid by Treasury Board of Canada Secretariat 175,000166,900
Audit services provided by Office of the Auditor General of Canada96,000 100,000
Leasehold improvements paid by Public Works and Government Services Canada- 83,400
 530,100 628,900

 

10. Contractual Obligations

The nature of the Office’s activities can result in some large multi-year contracts and obligations whereby the Office will be obligated to make future payments when the goods or services are received. These obligations include service contracts and equipment rental. Significant contractual obligations that can be reasonably estimated are summarized as follows:

(in dollars)
2010-11649,300
2011-12178,400

 

2015-10-21