Financial Statements (unaudited) for the year ended March 31, 2017
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, 2017, 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 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 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.
Edmonton, Canada
August 22, 2017
Chief Financial Officer
August 21, 2017
Statement of Financial Position (Unaudited)
As at March 31
(in dollars)
2017 | 2016 | |
---|---|---|
Liabilities | ||
Accounts payable and accrued liabilities (note 4) | $ 61,389,983 | $ 53,405,680 |
Vacation pay and compensatory leave | 1,136,913 | 1,195,630 |
Employee future benefits (note 5) | 1,320,844 | 1,690,386 |
Total gross liabilities | 63,847,740 | 56,291,696 |
Total net liabilities | 63,847,740 | 56,291,696 |
Financial assets | ||
Due from Consolidated Revenue Fund | 60,954,607 | 53,129,082 |
Accounts receivable and advances (note 6) | 435,387 | 282,971 |
Loans receivable (note 7) | 52,733,424 | 35,712,911 |
Total gross financial assets | 114,123,418 | 89,124,964 |
Financial assets held on behalf of Government | ||
Loans receivable (note 7) | (52,733,424) | (35,712,911) |
Total financial assets held on behalf of Government | (52,733,424) | (35,712,911) |
Total net financial assets | 61,389,994 | 53,412,053 |
Departmental net debt | 2,457,746 | 2,879,643 |
Non-financial assets | ||
Tangible capital assets (note 8) | 76,786 | 90,885 |
Total non-financial assets | 76,786 | 90,885 |
Departmental net financial position | $ (2,380,960) | $ (2,788,758) |
Contractual obligations (note 9) The accompanying notes form an integral part of these financial statements. |
Edmonton, Canada
August 22, 2017
Chief Financial Officer
August 21, 2017
Statement of Operations and Departmental Net Financial Position (Unaudited)
For the Year Ended March 31
(in dollars)
2017 Planned Results |
2017 | 2016 | |
---|---|---|---|
Expenses | |||
Business Development and Innovation | 82,851,377 | 79,506,709 | 79,540,950 |
Community Economic Growth | 56,993,254 | 75,006,796 | 33,312,611 |
Policy, Advocacy and Coordination | 9,385,095 | 7,842,208 | 9,920,124 |
Internal Services | 13,965,032 | 14,030,210 | 15,860,126 |
Expenses incurred on behalf of Government | (56,901) | (10,650,154) | (1,743,640) |
Total expenses | 163,137,857 | 165,735,769 | 136,890,171 |
Revenues | |||
Amortization of discount | 92,016 | 71,156 | 139,508 |
Interest | 44,086 | 44,910 | 33,128 |
Other | 1,688 | 2,305 | 744,672 |
Revenues earned on behalf of Government | (136,546) | (116,131) | (914,064) |
Total revenues | 1,244 | 2,240 | 3,244 |
Net cost of operations before government funding and transfers | 163,136,613 | 165,733,529 | 136,886,927 |
Government funding and transfers | |||
Net cash provided by Government | 152,880,653 | 148,400,795 | |
Change in due from Consolidated Revenue Fund | 7,825,525 | (16,854,540) | |
Services provided without charge by other government departments (note 10) | 5,442,138 | 5,531,454 | |
Transfer of the transition payments for implementing salary payments in arrears | (2,705) | (15,190) | |
Transfer of assets and liabilities from (to) other government departments (note 11) | (4,284) | (19,311) | |
Total government funding and transfers | 166,141,327 | 137,043,208 | |
Net cost of operations after government funding and transfers | (407,798) | (156,281) | |
Departmental net financial position — Beginning of year | (2,788,758) | (2,945,039) | |
Departmental net financial position — End of year | $ (2,380,960) | $ (2,788,758) | |
Segmented information (note 12) 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)
2017 | 2016 | |
---|---|---|
Net cost of operations after government funding and transfers | $ (407,798) | $ (156,281) |
Change due to tangible capital assets | ||
Acquisition of tangible capital assets | 30,494 | 10,687 |
Amortization of tangible capital assets | (40,309) | (122,188) |
Loss on disposal of tangible capital assets | 0 | (6,766) |
Transfer to other government departments (note 11) | (4,284) | (19,311) |
Total change due to tangible capital assets | (14,099) | (137,578) |
Net decrease in departmental net debt | (421,897) | (293,859) |
Departmental net debt - Beginning of year | 2,879,643 | 3,173,502 |
Departmental net debt - End of year | $ 2,457,746 | $ 2,879,643 |
The accompanying notes form an integral part of these financial statements. |
Statement of Cash Flows (Unaudited)
For the Period Ended March 31
(in dollars)
2017 | 2016 | |
---|---|---|
Operating activities | ||
Net cost of operations before government funding and transfers | $ 165,733,529 | $ 136,886,927 |
Non-cash items: | ||
Amortization of tangible capital assets | (40,309) | (122,188) |
Loss on disposal of tangible capital assets | 0 | (6,766) |
Services provided without charge by other government departments (note 10) | (5,442,138) | (5,531,454) |
Transition payments for implementing salary payments in arrears | 2,705 | 15,190 |
Variations in Statement of Financial Position: | ||
Increase in accounts receivable and advances | 152,416 | 277,076 |
(Increase) decrease in accounts payable and accrued liabilities | (7,984,303) | 16,580,255 |
Decrease in vacation pay and compensatory leave | 58,717 | 125,885 |
Decrease in employee future benefits | 369,542 | 165,183 |
Cash used in operating activities | 152,850,159 | 148,390,108 |
Capital investing activities | ||
Acquisition of tangible capital assets | 30,494 | 10,687 |
Cash used in capital investing activities | 30,494 | 10,687 |
Net cash provided by Government of Canada | $ 152,880,653 | $ 148,400,795 |
The accompanying notes form an integral part of these financial statements. |
Notes to the Financial Statements (Unaudited)
For the Year Ended March 31
1. Authority and Objectives
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 with business and community organizations, research and academic institutions, Indigenous Peoples, as well as provincial and municipal governments across Western Canada.
WD works to grow the western Canadian economy by helping to build businesses that are productive, 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 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:
- 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 2016-2017 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 2016-2017 Report on Plans and Priorities.
- 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.
- 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.
- 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, he has no authority regarding the disposition of non-respendable revenues. As a result, non-respendable revenues are considered to be earned on behalf of the Government of Canada and are therefore presented in reduction of the entity's gross revenues.
- Revenues are accounted for in the period in which the underlying transaction or event that gave rise to the revenue takes place.
- 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.
- 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.
- Employee future benefits
- 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.
- Severance benefits: Employees entitled to severance benefits under labour contracts or conditions of employment earn these benefits 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.
- 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.
- 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.
- 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.
- 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.
- 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.
- 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:
Tangible capital assets Asset Class Amortization Period Machinery and equipment 10 years Computer hardware 3 years Computer software 7 years Vehicles 5 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.
- 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.
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
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Net cost of operations before government funding and transfers | $ 165,733,529 | $ 136,886,927 |
Adjustments for items affecting net cost of operations but not affecting authorities: | ||
Amortization of tangible capital assets | (40,309) | (122,188) |
Services provided without charge by other government departments | (5,442,138) | (5,531,454) |
Decrease in vacation pay and compensatory leave | 58,717 | 125,885 |
Decrease in employee future benefits | 369,542 | 165,183 |
Decrease in accrued liabilities not charged to authorities | 492,508 | 421,834 |
Refund of prior years expenditures | 79,145 | 3,802,501 |
Other | 1,809 | (3,522) |
Total items affecting net cost of operations but not affecting authorities | (4,480,726) | (1,141,761) |
Adjustments for items not affecting net cost of operations, but affecting authorities: | ||
Acquisitions of tangible capital assets | 30,494 | 10,687 |
Transition payments for implementing salary payments in arrears | 2,705 | 15,190 |
Unconditionally repayable transfer payments | 29,197,272 | 19,920,331 |
Total items not affecting net cost of operations but affecting authorities | 29,230,471 | 19,946,208 |
Current year authorities used | $ 190,483,274 | $ 155,691,374 |
(b) Authorities provided and used
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Authorities provided: | ||
Vote 1 - Operating expenditures | $ 36,720,314 | $ 38,841,639 |
Vote 5 - Transfer payments | 163,559,924 | 122,248,119 |
Statutory amounts | 3,811,508 | 4,029,284 |
Less: | ||
Lapsed: Operating | (2,792,064) | (3,512,174) |
Lapsed: Transfer payments | (10,816,408) | (5,915,494) |
Current year authorities used | $ 190,483,274 | $ 155,691,374 |
4. Accounts payable and accrued liabilities
The following table presents details of WD's accounts payable and accrued liabilities:
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Accounts payable - Other government departments and agencies | $ 98,149 | $ 483,135 |
Accounts payable - External parties | 59,280,211 | 50,822,605 |
Total accounts payable | 59,378,360 | 51,305,740 |
Accrued liabilities | 2,011,623 | 2,099,940 |
Total accounts payable and accrued liabilities | $ 61,389,983 | $ 53,405,680 |
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 2016-2017 expense amounts to $2,653,917 ($2,774,330 in 2015-2016). For Group 1 members, the expense represents approximately 1.12 times (1.25 times in 2015-2016) the employee contributions and, for Group 2 members, approximately 1.08 times (1.24 times in 2015-2016) 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
Severance benefits provided to WD 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, 2017, 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:
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Accrued benefit obligation - Beginning of year | $ 1,690,386 | $ 1,855,569 |
Expense for the year | (16,390) | 246,392 |
Benefits paid during the year | (353,152) | (411,575) |
Accrued benefit obligation - End of year | $ 1,320,844 | $ 1,690,386 |
6. Accounts receivable and advances
The following table presents details of WD's accounts receivable and advances balances:
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Receivables - Other government departments and agencies | $ 433,776 | $ 274,998 |
Receivables - External parties | 11 | 6,373 |
Employee advances | 1,600 | 1,600 |
Gross and net accounts receivable | $ 435,387 | $ 282,971 |
7. Loans receivable
The following table presents details of WD's loans and transfer payments recoverable balances:
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Loans receivable | ||
Unconditionally repayable transfer payments | $ 75,463,922 | $ 47,802,711 |
Accrued interest - unconditionally repayable transfer payments | 32,923 | 9,268 |
Less: Unamortized discount | (2,821,068) | (1,091,071) |
Subtotal | 72,675,777 | 46,720,908 |
Transfer payments recoverable - Conditionally repayable transfer payments | 0 | 85,355 |
Subtotal | 72,675,777 | 46,806,263 |
Less: Allowance for uncollectibility | (19,942,353) | (11,093,352) |
Gross loans receivable | 52,733,424 | 35,712,911 |
Loans receivable held on behalf of Government | (52,733,424) | (35,712,911) |
Net loans receivable | $ 0 | $ 0 |
(a) Unconditionally repayable transfer payments
The unconditionally repayable transfer payment portfolio consists of 97 non-interest bearing loans issued in the years from 1997 to 2017, 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 $19,942,253 ($11,093,252 in 2015–2016) has been recorded.
With respect to interest charged on unconditionally repayable transfer payments, an allowance of $100 ($100 in 2015–2016) has been recorded.
(b) Transfer payments recoverable – Conditionally repayable transfer payments
Transfer payments recoverable relate to contributions made to outside parties which are repayable based on conditions specified in the contribution agreement that have come into being. No allowance in 2016–2017 ($0 in 2015–2016) 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 | 2017 | 2016 | |
(in dollars) | ||||||||||||
Machinery and equipment | $ 79,943 | $ 0 | $ 0 | $ 0 | $ 79,943 | $ 56,386 | $ 2,805 | $ 0 | $ 0 | $ 59,191 | $ 20,752 | $ 23,557 |
Computer hardware | 0 | 30,494 | 0 | 0 | 30,494 | 0 | 2,541 | 0 | 0 | 2,541 | 27,953 | 0 |
Computer software | 1,885,642 | 0 | 0 | 0 | 1,885,642 | 1,861,689 | 18,247 | 0 | 0 | 1,879,936 | 5,706 | 23,953 |
Vehicles | 56,429 | 0 | (32,130) | 0 | 24,299 | 35,423 | 7,002 | (27,846) | 0 | 14,579 | 9,720 | 21,006 |
Leasehold improvements | 410,272 | 0 | 0 | 121,345 | 288,927 | 387,903 | 9,714 | 0 | 121,345 | 276,272 | 12,655 | 22,369 |
Total | $ 2,432,286 | $ 30,494 | $ (32,130) | $ 121,345 | $ 2,309,305 | $ 2,341,401 | $ 40,309 | $ (27,846) | $ 121,345 | $ 2,232,519 | $ 76,786 | $ 90,885 |
(1) Effective September 2016, WD transferred a vehicle with a net book value of $4,284 to Correctional Services Canada (refer to note 11 for further details).
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:
2018 | 2019 | 2020 | 2021 | 2022 and thereafter | Total | |
---|---|---|---|---|---|---|
(in dollars) | ||||||
Transfer payments | ||||||
Western Diversification Program | $ 59,693,311 | $ 17,938,639 | $ 4,141,394 | $ 2,621,649 | $ 2,514,218 | $ 86,909,211 |
Canada 150 Community Infrastructure Program | 55,574,941 | 0 | 0 | 0 | 0 | 55,574,941 |
Community Futures Program | 26,365,978 | 0 | 0 | 0 | 0 | 26,365,978 |
Women's Enterprise Initiative | 3,753,917 | 0 | 0 | 0 | 0 | 3,753,917 |
Total | $ 145,388,147 | $ 17,938,639 | $ 4,141,394 | $ 2,621,649 | $ 2,514,218 | $ 172,604,047 |
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:
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Employer's contribution to the health and dental insurance plans | $ 2,364,627 | $ 2,286,151 |
Accommodation | 3,028,472 | 3,196,252 |
Workers' Compensation | 49,039 | 49,051 |
Total | $ 5,442,138 | $ 5,531,454 |
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 Indigenous and Northern Affairs Canada, and not those of WD.
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Building Canada Fund (Communities) | $ 9,340,723 | $ 20,014,860 |
Strategic Partnerships Initiative | 2,042,100 | 0 |
Total | $ 11,382,823 | $ 20,014,860 |
(c) Other transactions with related parties
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Expenses - Other government departments and agencies | $ 1,613,276 | $ 2,121,721 |
11. Transfers from/to other government departments
2017 | 2016 | |
---|---|---|
(in dollars) | ||
Assets: | ||
Tangible capital assets (net book value) (note 8) | ||
Transferred to Correctional Services Canada | $ 4,284 | $ 0 |
Transferred to Privy Council Office | 0 | 19,311 |
Total assets transferred | 4,284 | 19,311 |
Adjustment to the departmental net financial position | $ 4,284 | $ 19,311 |
12. 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 | 2017 Total |
2016 Total |
|
---|---|---|---|---|---|---|
(in dollars) | ||||||
Transfer payments | ||||||
Non-profit organizations | $ 52,465,330 | $ 51,681,704 | $ 0 | $ 0 | $ 104,147,034 | $ 95,046,203 |
Other levels of governments within Canada | 996,408 | 17,971,352 | 0 | 0 | 18,967,760 | 88,000 |
Industry | 1,906,945 | 0 | 0 | 0 | 1,906,945 | 627,133 |
Transfer payment conditions met | 0 | 0 | 0 | 0 | 0 | (2,886,992) |
Total transfer payments | 55,368,683 | 69,653,056 | 0 | 0 | 125,021,739 | 92,874,344 |
Operating expenses | ||||||
Salaries and employee benefits | 10,477,505 | 4,503,813 | 6,711,985 | 9,355,818 | 31,049,121 | 32,283,529 |
Bad debt expense | 8,652,890 | 90,319 | 0 | 0 | 8,743,209 | 1,116,507 |
Professional and special services | 3,644,719 | 212,797 | 116,975 | 941,364 | 4,915,855 | 5,554,687 |
Accommodation | 1,046,337 | 444,277 | 619,928 | 917,930 | 3,028,472 | 3,196,252 |
Rentals | 210,182 | 73,451 | 330,658 | 691,424 | 1,305,715 | 920,181 |
Transportation and communication | 43,317 | 5,982 | 20,042 | 920,995 | 990,336 | 1,162,585 |
Acquisition of machinery and equipment | 10,145 | 3,655 | 7,494 | 649,059 | 670,353 | 848,074 |
Repairs and maintenance | 1,091 | 421 | 1,231 | 273,373 | 276,116 | 180,540 |
Information | 17,086 | 9,731 | 12,407 | 141,752 | 180,976 | 235,283 |
Utilities, materials and supplies | 20,240 | 8,109 | 15,213 | 90,648 | 134,210 | 141,000 |
Amortization of tangible capital asset | 0 | 0 | 0 | 40,309 | 40,309 | 122,188 |
Other | 14,514 | 1,185 | 6,275 | 7,538 | 29,512 | (1,359) |
Expenses incurred on behalf of government | (10,559,835) | (90,319) | 0 | 0 | (10,650,154) | (1,743,640) |
Total operating expenses | 13,578,191 | 5,263,421 | 7,842,208 | 14,030,210 | 40,714,030 | 44,015,827 |
Total expenses | 68,946,874 | 74,916,477 | 7,842,208 | 14,030,210 | 165,735,769 | 136,890,171 |
Revenues | ||||||
Amortization of discount | 0 | 71,156 | 0 | 0 | 71,156 | 139,508 |
Interest | 57 | 44,853 | 0 | 0 | 44,910 | 33,128 |
Other | 814 | 299 | 446 | 746 | 2,305 | 744,672 |
Revenues earned on behalf of government | (57) | (116,009) | 0 | (65) | (116,131) | (914,064) |
Total revenues | 814 | 299 | 446 | 681 | 2,240 | 3,244 |
Net cost from continuing operations | $ 68,946,060 | $ 74,916,178 | $ 7,841,762 | $ 14,029,529 | $ 165,733,529 | $ 136,886,927 |
13. Comparative information
Comparative figures have been reclassified to conform to the current year's presentation.
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