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Financial Statements (unaudited) for the year ended March 31, 2016

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, 2016, and all information contained in these statements rests with the management of Western Economic Diversification Canada (WD). 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 WD's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in WD's Departmental Performance 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 WD 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.

WD 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 Internal Control.

A Core Control Audit was performed in 2013-2014 by the Office of the Comptroller General of Canada (OCG). The Audit Report and related Management Action Plan are posted on the departmental web site.

The financial statements of Western Economic Diversification Canada have not been audited.

 

Dylan Jones, Deputy Minister
Edmonton, Canada




 
 
Date
 
Cathy McLean
Chief Financial Officer



 
 
Date
 

 


 

Statement of Financial Position (Unaudited)
As at March 31

(in dollars)

  2016 2015
Liabilities
Accounts payable and accrued liabilities (note 4) $ 53,405,680 $ 69,985,935
Vacation pay and compensatory leave 1,195,630 1,321,515
Employee future benefits (note 5) 1,690,386 1,855,569
Total gross liabilities 56,291,696 73,163,019
 
Total net liabilities 56,291,696 73,163,019
 
Financial assets
Due from Consolidated Revenue Fund 53,129,082 69,983,622
Accounts receivable and advances  (note 6) 282,971 5,895
Loans receivable (note 7) 35,712,911 19,253,531
Total gross financial assets 89,124,964 89,243,048
 
Financial assets held on behalf of Government
Loans receivable (note 7) (35,712,911) (19,253,531)
Total financial assets held on behalf of Government (35,712,911) (19,253,531)
 
Total net financial assets 53,412,053 69,989,517
 
Departmental net debt 2,879,643 3,173,502
 
Non-financial assets
Tangible capital assets (note 8) 90,885 228,463
Total non-financial assets 90,885 228,463
 
Departmental net financial position $ (2,788,758) $ (2,945,039)
Contractual obligations (note 9)

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

 

Dylan Jones, Deputy Minister
Edmonton, Canada




 
 
Date
 
Cathy McLean
Chief Financial Officer



 
 
Date
 

 


 

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

(in dollars)

  2016
Planned
Results
2016 2015
Expenses
Business Development and Innovation $ 91,482,536 $ 79,540,950 $ 98,881,388
Community Economic Growth 32,058,341 33,312,611 28,944,563
Policy, Advocacy and Coordination 11,202,994 9,920,124 9,674,552
Internal Services 14,526,416 15,860,126 15,216,891
Expenses incurred on behalf of Government (256,956) (1,743,640) (1,503,300)
Total expenses 149,013,331 136,890,171 151,214,094
 
Revenues
Other 182,268 744,672 708
Amortization of discount 34,529 139,508 871,108
Interest 24,680 33,128 34,929
Revenues earned on behalf of Government (239,606) (914,064) (906,156)
Total revenues 1,871 3,244 589
 
Net cost of operations before government funding and transfers 149,011,460 136,886,927 151,213,505
 
Government funding and transfers
Net cash provided by Government   148,400,795 137,964,702
Change in due from Consolidated Revenue Fund   (16,854,540) 8,150,088
Services provided without charge by other government departments (note 10)   5,531,454 5,520,716
Transfer of the transition payments for implementing salary payments in arrears (note 11)   (15,190) (970,664)
Transfer of assets and liabilities from (to) other government departments (note 12)   (19,311) (1,351)
Total government funding and transfers   137,043,208 150,663,491
 
Net cost of operations after government funding and transfers   (156,281) 550,014
 
Departmental net financial position — Beginning of year   (2,945,039) (2,395,025)
Departmental net financial position — End of year   $ (2,788,758) $ (2,945,039)
Segmented information (note 13)

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)

  2016 2015
Net cost of operations after government funding and transfers $ (156,281) $ 550,014
 
Change due to tangible capital assets
Acquisition of tangible capital assets 10,687 24,139
Amortization of tangible capital assets (122,188) (242,348)
(Loss) on disposal of tangible capital assets (6,766) (19,429)
Transfer to other government departments (note 12) (19,311) (1,351)
Total change due to tangible capital assets (137,578) (238,989)
 
Net increase (decrease) in departmental net debt (293,859) 311,025
 
Departmental net debt - Beginning of year 3,173,502 2,862,477
Departmental net debt - End of year $ 2,879,643 $ 3,173,502
The accompanying notes form an integral part of these financial statements.

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

(in dollars)

  2016 2015
Operating activities
Net cost of operations before government funding and transfers $ 136,886,927 $ 151,213,505
Non-cash items:
Amortization of tangible capital assets (122,188) (242,348)
(Loss) on disposal of tangible capital assets (6,766) (19,429)
Services provided without charge by other government departments (note 10) (5,531,454) (5,520,716)
 
Variations in Statement of Financial Position:
Increase (decrease) in accounts receivable and advances 277,076 (28,316)
Decrease (increase) in accounts payable and accrued liabilities 16,580,255 (8,118,190)
Decrease in vacation pay and compensatory leave 125,885 88,380
Decrease (increase) in employee future benefits 165,183 (402,987)
Transition payments for implementing salary payments in arrears (note 11) 15,190 970,664
Cash used in operating activities 148,390,108 137,940,563
 
Capital investing activities
Acquisition of tangible capital assets 10,687 24,139
Cash used in capital investing activities 10,687 24,139
 
Net cash provided by Government of Canada $ 148,400,795 $ 137,964,702
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 to promote the development and diversification of the economy of Western Canada and to advance the interests of the West in national economic policy, program and project development and implementation. The Minister of Innovation, Science and Economic Development is responsible for this organization.

The Department operates under the provision of the Western Economic Diversification Act, which came into force on June 28, 1988. WD is responsible for regional development in Western Canada by developing and supporting economic policies, programs and activities to promote economic growth.

Its western base has enabled the Department to foster extensive partnerships across Western Canada with business and community organizations, research and academic institutions, Aboriginal groups as well as provincial and municipal governments.

WD works to develop and diversify the western Canadian economy, helping to build businesses that are innovative and competitive globally, while diversifying the base of the western Canadian economy beyond primary resource industries:

WD's strategic outcome is advanced through the following programs:

  • Business Development and Innovation: Western Canadian small and medium-sized enterprises (SMEs) are engaged in international business, competitive and innovative;
     
  • Community Economic Growth: Western Canadian communities have strong businesses, the capacity for socio-economic development and the necessary public infrastructure to support economic growth;
     
  • Policy, Advocacy and Coordination: Policies and programs that strengthen the western Canadian economy; and
     
  • Internal Services: Effective and efficient support for advancing the department's strategic outcome.
     

2. Summary of significant accounting policies

These financial statements have been prepared using the Government'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 – WD is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to WD 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 2015-16 Report on Plans and Priorities. 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 2015-16 Report on Plans and Priorities.
     
  2. Net Cash Provided by Government – WD operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada.  All cash received by WD is deposited to the CRF, and all cash disbursements made by WD 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 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 WD is entitled to draw from the CRF without further authorities to discharge its liabilities.
     
  4. Revenues:
     
    • Revenues are accounted for in the period in which the underlying transaction or event that gave rise to the revenue takes place.
       
    • Revenues that are non-respendable are not available to discharge WD's liabilities. While the 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 considered to be earned on behalf of the Government of Canada and are therefore presented in reduction of the entity's gross revenues.
       
  5. Expenses - Expenses are recorded on the accrual basis:
     
    • Transfer payments are recorded as expenses when authorization for the payment exists and the recipient has met the eligibility criteria or the entitlements established for the transfer payment program. Transfer payments that become repayable as a result of conditions specified in the contribution agreement that have come into being are recorded as a reduction to transfer payment expense and as a receivable.

      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 estimated cost.
       
  6. Employee future benefits
     
    1. Pension benefits: Eligible employees participate in the Public Service Pension Plan (The Public Service Superannuation Act), a multiemployer plan administered by the Government. WD's contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. WD'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: Employees entitled to severance benefits under labour contracts or conditions of employment earn these as services necessary to earn them are rendered. 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.
       
  7. Accounts and loans receivable
     
    • These are stated at the lower of cost and net recoverable value. A valuation allowance is recorded for accounts and loans receivable where recovery is considered uncertain.
       
    1. Unconditionally repayable transfer payments: Transfer payments that are unconditionally repayable are recognized as loans receivable because they must be repaid without condition, under various repayment terms. The loans have significant concessionary terms as they include a no-interest clause, and are discounted so they can be recorded at their estimated present value.
       
    2. Transfer payments recoverable – Conditionally repayable transfer payments: Transfer payments that are conditionally repayable are reclassified as accounts receivable when conditions specified in the agreement come into effect, or in the event of default.
       
  8. Tangible capital assets – All tangible assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. WD does not capitalize intangibles, works of art and historical treasures that have cultural, aesthetic or historical value, assets located on Indian Reserves and museum collections.

    Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset as follows:
     
    Asset Class Amortization Period
    Machinery and equipment 10 years
    Vehicles 5 years
    Computer Software 3-7 years
    Leasehold improvements

    Lesser of the remaining term of lease or useful life of the improvement

    Assets under construction are recorded in the applicable capital asset class in the year that they become available for use and are not amortized until they become available for use.

  9. Measurement uncertainty – The preparation of these financial statements 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 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 transfer payments. 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.

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3. Parliamentary authorities

WD 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, WD 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

  2016 2015
(in dollars)
Net cost of operations before government funding and transfers $ 136,886,927 $ 151,213,505
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets (122,188) (242,348)
Services provided without charge by other government departments (5,531,454) (5,520,716)
Decrease in vacation pay and compensatory leave 125,885 88,380
Decrease (increase) in employee future benefits 165,183 (402,987)
Decrease in accrued liabilities not charged to authorities 421,834 1,777,917
Refund of prior years expenditures 3,802,501 4,748,771
Other (3,522) (15,258)
Total items affecting net cost of operations but not affecting authorities (1,141,761) 433,759
 
Adjustments for items not affecting net cost of operations, but affecting authorities:
Acquisitions of tangible capital assets 10,687 24,139
Transition payments for implementing salary payments in arrears 15,190 970,664
Unconditionally repayable transfer payments 19,920,331 9,360,469
Total items not affecting net cost of operations but affecting authorities 19,946,208 10,355,272
 
Current year authorities used $ 155,691,374 $ 162,002,536

(b) Authorities provided and used

  2016 2015
(in dollars)
Authorities provided:
Vote 1 - Operating expenditures $ 38,841,639 $ 39,107,069
Vote 5 - Transfer payments 122,248,119 122,232,026
Statutory amounts 4,029,284 4,248,406
 
Less:
Lapsed: Operating (3,512,174) (3,050,614)
Lapsed: Transfer payments (5,915,494) (534,351)
 
Current year authorities used $ 155,691,374 $ 162,002,536

4. Accounts payable and accrued liabilities

The following table presents details of WD's accounts payable and accrued liabilities:

  2016 2015
(in dollars)
Accounts payable - Other government departments and agencies $ 483,135 $ 215,039
Accounts payable - External parties 50,822,605 67,706,090
Total accounts payable 51,305,740 67,921,129
 
Accrued liabilities 2,099,940 2,064,806
 
Total accounts payable and accrued liabilities $ 53,405,680 $ 69,985,935

In Canada's Economic Action Plan 2012, the Government announced savings measures to be implemented by departments over the next three fiscal years starting in 2012-2013. As a result, the Department has recorded at March 31, 2016, an obligation for termination benefits for an amount of $0 ($42,191 in 2014-2015) as part of accrued liabilities to reflect the estimated workforce adjustment costs.

5. Employee future benefits

(a) Pension benefits

WD 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 WD 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 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 2015-2016 expense amounts to $2,774,330 ($2,899,376 in 2014-2015).  For Group 1 members, the expense represents approximately 1.25 times (1.41 times in 2014-2015) the employee contributions and, for Group 2 members, approximately 1.24 times (1.39 times in 2014-2015) the employee contributions.

WD'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

WD provides severance benefits to its employees based on eligibility, years of service and salary at termination of employment. These severance benefits are not pre-funded.  Benefits will be paid from future authorities.

As part of the collective agreement negotiations with certain employee groups, and changes to conditions of employment for executives and certain non-represented employees, the accumulation of severance benefits under the employee severance pay program ceased for these employees commencing in 2012. Employees subject to these changes have been given the option to be immediately paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits on termination from the public service. These changes have been reflected in the calculation of the outstanding severance benefit obligation. Information about the severance benefits, measured as at March 31, is as follows:

  2016 2015
(in dollars)
Accrued benefit obligation - Beginning of year $ 1,855,569 $ 1,452,582
Expense for the year 246,392 755,974
Benefits paid during the year (411,575) (352,987)
Accrued benefit obligation - End of year $ 1,690,386 $ 1,855,569

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6. Accounts receivable and advances

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

  2016 2015
(in dollars)
Receivables - Other government departments and agencies $ 274,998 $ 413
Receivables - External parties 6,373 3,582
Employee advances 1,600 1,900
Gross and net accounts receivable $ 282,971 $ 5,895

7. Loans receivable

The following table presents details of WD's loans and transfer payments recoverable balances:

  2016 2015
(in dollars)
Loans receivable
Unconditionally repayable transfer payments $ 47,802,711 $ 30,490,742
Accrued interest - unconditionally repayable transfer payments 9,268 7,375
Less: Unamortized discount (1,091,071) (695,620)
Subtotal 46,720,908 29,802,497
 
Transfer payments recoverable - Conditionally repayable transfer payments 85,355 0
Subtotal 46,806,263 29,802,497
 
Less: Allowance for uncollectibility (11,093,352) (10,548,966)
 
Gross loans receivable 35,712,911 19,253,531
 
Loans receivable held on behalf of Government (35,712,911) (19,253,531)
 
Net loans receivable $ 0 $ 0

(a) Unconditionally repayable transfer payments

The unconditionally repayable transfer payment portfolio consists of 70 non-interest bearing loans issued in the years from 1997 to 2016, 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 $11,093,252 ($10,548,966 in 2014–2015) has been recorded.

With respect to interest charged on unconditionally repayable transfer payments, an allowance of $100 ($0 in 2014–2015) has been recorded.

(b) Transfer payments recoverable – Conditionally repayable transfer payments

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. No allowance in 2015–2016 ($0 in 2014–2015) has been recorded.

8. Tangible capital assets

Capital asset class Cost Accumulated Amortization Net Book Value
Opening Balance Acquisitions Adjustments
(1)
Disposals and Write-Offs Closing balance Opening Balance Amortization Adjustments
(1)
Disposals and Write-Offs Closing Balance 2016 2015
(in dollars)
Machinery and equipment $ 81,946 $ 10,687 $ 0 $ 12,690 $ 79,943 $ 59,632 $ 2,677 $ (1) $ 5,922 $ 56,386 $ 23,557 $ 22,314
Computer software 1,885,642 0 0 0 1,885,642 1,780,706 80,983 0 0 1,861,689 23,953 104,936
Vehicles 80,568 0 (24,139) 0 56,429 24,138 16,114 (4,829) 0 35,423 21,006 56,430
Leasehold improvements 843,970 0 0 433,698 410,272 799,187 22,414 0 433,698 387,903 22,369 44,783
Total $ 2,892,126 $ 10,687 $ (24,139) $ 446,388 $ 2,432,286 $ 2,663,663 $ 122,188 $ (4,830) $ 439,620 $ 2,341,401 $ 90,885 $ 228,463

(1) During March 2016, WD transferred to Privy Council Office a vehicle with a net book value of $19,311 (refer to note 12 for further details). This transfer is included with other minor rounding adjustments.

9. Contractual obligations

The nature of WD's activities can result in some large multi-year contracts and obligations whereby WD 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:

  2017 2018 2019 2020 2021 and thereafter Total
(in dollars)
Transfer payments
Western Diversification Program $ 64,402,497 $ 33,567,152 $ 6,929,139 $ 3,343,961 $ 3,676,139 $ 111,918,888
Community Futures Program 26,428,310 27,230,069 0 0 0 53,658,379
Canada 150 Community Infrastructure Program 22,824,152 23,093,507 0 0 0 45,917,659
Women's Enterprise Initiative 3,753,750 3,900,000 0 0 0 7,653,750
Total $ 117,408,709 $ 87,790,728 $ 6,929,139 $ 3,343,961 $ 3,676,139 $ 219,148,676

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10. Related party transactions

WD is related as a result of common ownership to all government departments, agencies and Crown Corporations. WD enters into transactions with these entities in the normal course of business and on normal trade terms. During the year, WD received common services which were obtained without charge from other government departments as disclosed below.

(a) Common services provided without charge by other government departments

During the year, WD received services without charge from certain common service organizations, related to accommodation, the employer's contribution to the health and dental insurance plans and workers' compensation coverage. These services provided without charge have been recorded in WD's Statement of Operations and Departmental Net Financial Position as follows:

  2016 2015
(in dollars)
Employer's contribution to the health and dental insurance plans $ 2,286,151 $ 2,304,565
Accommodation 3,196,252 3,168,401
Workers' Compensation 49,051 47,750
Total $ 5,531,454 $ 5,520,716

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 Works and Government Services Canada, audit services provided by the Office of the Auditor General, and the email, network and data centre services provided by Shared Services Canada, are not included in WD's Statement of Operations and Departmental Net Financial Position.

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

Part of WD's mandate is to coordinate federal economic activities in the West. In this regard, WD implements programs on behalf of other federal departments and agencies. The following is a list of programs valued at greater than one million dollars in federal transfer payments administered by WD over the last two fiscal years. These transfer payment expenses are reflected in the financial statements of Infrastructure Canada and Aboriginal Affairs and Northern Development Canada, and not those of WD.

  2016 2015
(in dollars)
Building Canada Fund (Communities) $ 20,014,860 $ 23,907,933
Canada Strategic Infrastructure Fund 0 1,712,743
Strategic Partnerships Initiative 0 1,441,859
Total $20,014,860 $ 27,062,535

(c) Other transactions with related parties

  2016 2015
(in dollars)
Expenses - Other government departments and agencies $ 2,121,721 $ 1,450,252

11. Transfer of the transition payments for implementing salary payments in arrears

  2016 2015
(in dollars)
Transition Payment
Transferred to Public Works and Government Services Canada $ 15,190 $ 970,664
Adjustment to the departmental net financial position $ 15,190 $ 970,664

The Government of Canada implemented salary payments in arrears in 2014-2015. As a result, a one-time payment was issued to employees and will be recovered from them in the future. The transition to salary payments in arrears forms part of the transformation initiative that replaces the pay system and also streamlines and modernizes the pay processes. This change to the pay system had no impact on the expenses of the Department. However, it did result in the use of additional spending authorities by the Department. Prior to year-end, the transition payments for implementing salary payments in arrears were transferred to a central account administered by Public Works and Government Services Canada, who is responsible for the administration of the Government pay system.

12. Transfers from/to other government departments

  2016 2015
(in dollars)
Assets:
Tangible capital assets (net book value) (note 8)
Transferred to Privy Council Office $ 19,311 $ 0
Transferred from Treasury Board of Canada Secretariat 0 (21,059)
Transferred to Natural Resources Canada 0 22,409
Transferred to Employment and Social Development Canada 0 1
Total assets transferred 19,311 1,351
 
Adjustment to the departmental net financial position $ 19,311 $ 1,351

13. Segmented information

Presentation by segment is based on WD's program alignment architecture. 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 program activities, by major object of expense and by major type of revenue. The segment results for the period are as follows:

  Business Development and Innovation Community Economic Growth Policy, Advocacy and Coordination Internal Services 2016
Total
2015
Total
(in dollars)
Transfer payments
Non-profit organizations $ 61,755,486 $ 31,250,299 $ 2,040,418 $ 0 $ 95,046,203 $ 110,160,351
Industry 627,133 0 0 0 627,133 502,206
Other levels of governments within Canada 88,000 0 0 0 88,000 (21,728)
Transfer payment conditions met 0 (2,886,992) 0 0 (2,886,992) (4,183,821)
Total transfer payments 62,470,619 28,363,307 2,040,418 0 92,874,344 106,457,008
 
Operating expenses
Salaries and employee benefits 11,386,369 3,894,416 6,764,158 10,238,586 32,283,529 33,615,312
Professional and special services 3,428,889 207,385 90,700 1,827,713 5,554,687 5,025,969
Accommodation 1,238,867 394,417 617,836 945,132 3,196,252 3,168,401
Rentals 26,515 6,754 23,415 1,105,901 1,162,585 1,262,198
Bad debt expense 764,002 352,505 0 0 1,116,507 1,001,094
Transportation and communication 163,843 85,170 319,870 351,298 920,181 970,252
Acquisition of machinery and equipment 7,702 2,446 16,866 821,060 848,074 623,474
Information 32,440 5,342 31,810 165,691 235,283 211,970
Repairs and maintenance 457 143 2,077 177,863 180,540 23,604
Utilities, materials and supplies 14,262 4,233 14,994 107,511 141,000 150,144
Amortization of tangible capital asset 0 0 0 122,188 122,188 242,348
Other 6,985 (3,507) (2,020) (2,817) (1,359) (34,380)
Expenses incurred on behalf of government (1,391,135) (352,505) 0 0 (1,743,640) (1,503,300)
Total operating expenses 15,679,196 4,596,799 7,879,706 15,860,126 44,015,827 44,757,086
Total expenses 78,149,815 32,960,106 9,920,124 15,860,126 136,890,171 151,214,094
 
Revenues
Other 1,127 741,777 563 1,205 744,672 708
Amortization of discount 0 139,508 0 0 139,508 871,108
Interest 0 33,128 0 0 33,128 34,929
Revenues earned on behalf of government 0 (914,054) 0 (10) (914,064) (906,156)
Total revenues 1,127 359 563 1,195 3,244 589
Net cost from continuing operations $ 78,148,688 $ 32,959,747 $ 9,919,561 $ 15,858,931 $ 136,886,927 $ 151,213,505

14. Comparative information

Comparative figures have been reclassified to conform to the current year's presentation.