Canadian Grain Commission Revolving Fund

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Statement of Management Responsibility

We have prepared the accompanying financial statements of the Canadian Grain Commission Revolving Fund as required by and in accordance with the policy of Treasury Board on Special Revenue Spending Authorities and the reporting requirements and standards of the Receiver General for Canada. These financial statements were prepared by management of the Fund in accordance with the significant accounting policies set out in Note 2 of the statements, on a basis consistent with that of the preceding year. Some previous year's figures have been reclassified to conform to the current year's presentation.

Responsibility for the integrity and objectivity of these financial statements rests with the management of the Fund. To assure maximum objectivity and freedom from bias, the financial data contained in these financial statements has been examined by the Departmental Audit Committee. The information included in these financial statements is based on management's best estimate and judgment with due consideration given to materiality. To fulfill its accounting and reporting responsibilities, the Fund maintains a set of accounts which provides a centralized record of the Fund's financial transactions. Financial information submitted to the Public Accounts of Canada and included in the department's Departmental Performance Report is consistent with these financial statements.

The Canadian Grain Commission's Finance Division develops and disseminates financial management and accounting policies and issues specific directives, which maintain standards of accounting and financial management. The Fund maintains systems of financial management and internal control which gives due consideration to costs, benefits and risks. They are designed to provide reasonable assurance that transactions are properly authorized by Parliament, are executed in accordance with prescribed regulations, and are properly recorded to maintain accountability of Government funds and safeguard the assets under the Fund's administration. Financial management and internal control systems are augmented by the maintenance of internal audit programs. The Fund also seeks to assure the objectivity and integrity of data in its financial statements by the careful selection, training and development of qualified staff, by organizational arrangements that provide appropriate divisions of responsibility and by communicating programs aimed at ensuring that its regulations, policies, standards and managerial authorities are understood throughout the organization.

In order to assure maximum objectivity and freedom from bias, these financial statements have been examined by external auditors. The auditors' role is to express an independent opinion as to whether the financial statements present fairly the financial position of the Fund as at March 31, 2015 and the results of operations and the change in financial position for the year. This opinion has been appended to these financial statements.

Approved by:

Cheryl Blahey
Chief Financial Officer

May 22, 2015

Statement of Authority provided (Used)(unaudited) for the year ended as at March 31

Table Summary

The table presents on a comparative basis the statement of Authority provided (Used) (Unaudited). It consists of five columns: item descriptions, current year with two columns — estimates and actual, and previous year with two columns — estimates and actual. Subtotals are displayed at operating source (use) of funds and totals are displayed at the authority provided (used).

(in thousands of dollars)

  2015 2014
Estimates Actual Estimates Actual
Net results 3,867 29,882 1,565 31,518
Add: items not requiring use of funds 3,295 277 3,861 (negative 3,874)
Operating source of funds 7,162 30,159 5,426 27,644
Less: items requiring use of funds        
Net capital acquisitions 3,961 3,343 3,318 2,636
Transition payments for implementing salary payments in arrears   1,093    
Net other assets and liabilities 11,147 1,307 5,308 15,047
Authority provided (used) (negative 7,946) 24,416 (negative 3,200) 9,961

Reconciliation of Unused Authority (Unaudited) as at March 31

Table Summary

The table presents on a comparative basis the reconciliation of Unused Authority (Unaudited). It consists of three columns: item descriptions, current year and previous year. Subtotals are displayed at net authority used, end of year and totals are displayed at the unused authority carried forward.

(in thousands of dollars)

  2015 2014
Debit balance in the accumulated net charge against the Fund's authority 63,284 35,610
Payables at year‑end charged against the appropriation after March 31 3,659 5,957
Amounts credited to the appropriation after March 31 (negative 292) (negative 1,251)
Net authority provided, end of year 67,235 42,818
Authority limit 2,000 2,000
Unused authority carried forward 69,235 44,818

Independent Auditors' Report

To the Chief Commissioner, Commissioners and the Departmental Audit Committee of Canadian Grain Commission Revolving Fund

We have audited the accompanying financial statements of the Canadian Grain Commission Revolving Fund, which comprise the statement of financial position as at March 31, 2015, and the statements of operations and net assets (liabilities), and cash flows for the year then ended, and the related notes, which comprise a summary of significant accounting policies and other explanatory information. These financial statements have been prepared by management of the Fund to meet the requirements of Section 6.4 of the Treasury Board of Canada's Special Revenue Spending Authorities.

Management's responsibility for the financial statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Section 6.4 of the Treasury Board of Canada's Policy on Special Revenue Spending Authorities, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors' responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Canadian Grain Commission Revolving Fund as at March 31, 2015, and the results of its operations and its cash flow for the year then ended in accordance with Section 6.4 of the Treasury Board of Canada's Policy on Special Revenue Spending Authorities.

Basis of accounting and restriction on use

Without modifying our opinion, we draw attention to Note 2 to the financial statements, which describes the basis of accounting. The financial statements are prepared to assist the Canadian Grain Commission Revolving Fund to meet the requirements of Section 6.4 of the Treasury Board of Canada's Policy on Special Revenue Spending Authorities. As a result, the financial statements may not be suitable for another purpose. Our report is intended solely for the management of the Canadian Grain Commission Revolving Fund and the Treasury Board of Canada and should not be used by parties other than the Canadian Grain Commission Revolving Fund or the Treasury Board of Canada.

PricewaterhouseCoopers LLP
Chartered Professional Accountants,
Licensed Public Accountants

May 26, 2015

Statement of Financial Position as at March 31

Table Summary

The table presents on a comparative basis the statement of Financial Position. It consists of three columns: item descriptions, current year and previous year. Item descriptions are grouped in two: the assets and the liabilities and net liabilities, both displaying totals. Current item descriptions are grouped together for assets and for liabilities, both displaying subtotals at total current assets and at total current liabilities. Subtotals are displayed at total liabilities and at total net liabilities.

(in thousands of dollars)

  2015 2014
Assets    
Current    
Cash in transit 807 494
Accounts receivable (Note 3) 8,725 9,629
Other assets 268 377
Total current assets 9,800 10,500
Long‑term    
Capital assets (Note 4)    
At cost 31,728 35,220
Less: Accumulated amortization (negative 23,369) (negative 27,337)
Total long‑term assets 8,359 7,883
Total assets 18,159 18,383
Liabilities and Net Assets (Liabilities)    
Current    
Accounts payable and accrued liabilities (Note 5) 1,767 1,196
Salaries payable (Note 6) 3,821 3,324
Vacation, overtime and compensatory leave payable 1,854 1,898
Deferred revenue 830 603
Current portion of employee severance benefits liability (Note 7) 346 2,984
Total current liabilities 8,618 10,005
Long‑term    
Employee severance benefits liability (Note 7) 2,781 2,733
Total liabilities 11,399 12,738
Net assets (liabilities) (Note 9) 6,760 5,645
Total 18,159 18,383

Approved by:

Elwin Hermanson
Deputy Head

Cheryl Blahey
Chief Financial Officer

Statement of Operations for the year ended as at March 31

Table Summary

The table presents on a comparative basis the statement of Operations with fourteen columns. The first column lists the item descriptions which are grouped in two: revenue and expenses, both displaying subtotals at total revenue and at total expenses. The last item description displays the net results. The next ten columns provide current year budgeted amounts and current year actuals for each following categories: quality assurance, quantity assurance, grain quality research, producer protection, internal services. columns twelve and thirteen displays the totals of the five previous categories under budget total and under actual total. The last column provides the total for the previous year at actual totals.

(in thousands of dollars)

  2015 2014
Quality Assurance Quantity Assurance Grain Quality Research Producer Protection Internal Service Total Total
Budget Actual Budget Actual Budget Actual Budget Actual Budget Actual Budget Actual Actual
Revenue                          
Service fees 48,575 67,499 3,802 6,071   4 11 237 20 47 52,408 73,858 51,177
Special appropriations (Note 8)           815           815 16,927
Parliamentary appropriations (Note 8)         5,247 5,230     245 245 5,492 5,475 5,447
Employee termination benefit appropriations (Note 8)   756   303   72   23 2,945 47 2,945 1,201 12,568
Contract revenue   1,046     356 545       16 356 1,607 1,103
License fees and producer cars             1,908 1,969     1,908 1,969 886
Total revenue 48,575 69,301 3,802 6,374 5,603 6,666 1,919 2,229 3,210 355 63,109 84,925 88,108
Expenses                          
Salaries and employee benefits 22,792 20,199 1,334 1,712 4,180 4,315 1,940 2,877 10,511 9,511 40,757 38,614 40,967
Occupancy costs 2,673 2,562 246 41 1,649 1,704 137 164 965 874 5,670 5,345 4,969
Travel 1,144 1,357 112 114 318 183 94 135 792 592 2,460 2,381 2,227
Repairs and supplies 618 672 6 21 1,185 1,385 8 56 838 819 2,655 2,953 2,521
Amortization of capital assets 918 732     1,037 877   47 1,294 947 3,249 2,603 2,603
Professional and special services 145 121 10 1 58 51 5 18 2,089 1,321 2,307 1,512 1,779
Communications 22 20     3 6 12 65 806 783 843 874 1,167
Other expenses 1,160 285   1   39 10 256 132 180 1,302 761 357
Total expenses 29,472 25,948 1,708 1,890 8,430 8,560 2,206 3,618 17,427 15,027 59,243 55,043 56,590
Net results 19,103 43,353 2,094 4,484 (negative 2,827) (negative 1,894) (negative 287) (negative 1,389) (negative 14,217) (negative 14,672) 3,866 29,882 31,518

Statement of Accumulated Surplus for the year ended as at March 31

Table Summary

The table presents on a comparative basis the statement of Accumulated Surplus. It consists of three columns: item descriptions, current year and previous year. Totals are displayed at accumulated surplus, end of year.

(in thousands of dollars)

Statement of Operations and Net Assets(Liabilities) for the year ended March 31

  2015 2014
Net results 29,882 31,518
Net assets (liabilities), beginning of year 5,645 (negative 19,333)
Transfer of the transition payments for implementing salary payments in arrears (Note 13) (negative 1,093)  
Net financial resources provided and change in the accumulated net charge against Fund's authority, during the year (negative 27,674) (negative 6,540)
Net assets (liabilities), end of year 6,760 5,645

Statement of Cash Flows for the year ended as at March 31

Table Summary

The table presents on a comparative basis the statement of Cash Flows. It consists of three columns: item descriptions, current year and previous year. Item descriptions are grouped in two: Operating activities and Investing activities, both displaying subtotals. subtotals are displayed at net financial resources (used) by and change in the accumulated net charge against the Fund's authority during the year. Totals are displayed at accumulated net charge against the Fund's authority end of year.

(in thousands of dollars)

  2015 2014
Operating activities    
Net results for the year 29,882 31,518
Items not affecting use of cash    
Amortization of capital assets 2,603 2,603
Provision for employee severance benefits (negative 67) 1,027
Loss (gain) on disposal of capital assets 264 (negative 137)
Subtotal 32,682 35,011
Payments of employee severance benefits (negative 2,523) (negative 7,367)
Transition payments for implementing salary payments in arrears (negative 1,093)  
Changes in non‑cash working capital items    
Cash in transit (negative 313) (negative 231)
Accounts receivable 904 (negative 2,138)
Other assets 109 (negative 118)
Accounts payable and accrued liabilities 571 (negative 458)
Salaries payable 497 (negative 15,400)
Vacation, overtime and compensatory leave payable (negative 44) (negative 862)
Deferred revenue 227 477
Net financial resources provided by operating activities 31,017 8,914
Investing activities    
Acquisition of capital assets (negative 3,343) (negative 2,374)
Net financial resources provided and change in the accumulated net charge against the Fund's authority, during the year 27,674 6,540
Accumulated net charge against the Fund's authority, beginning of year 35,610 29,070
Accumulated net charge against the Fund's authority, end of year 63,284 35,610

Notes to the financial statements for the year ended March 31, 2015

1. Authority and purpose

The Canadian Grain Commission Revolving Fund ("CGC", the "Revolving Fund" or the "Fund") derives its authority from the Canada Grain Act . The CGC's mandate as set out in the Act is to, in the interest of grain producers, establish and maintain standards of quality for Canadian grain, regulate grain handling in Canada, and to ensure a dependable commodity for domestic and export markets.

In order to effectively pursue its mandate, the CGC aims to achieve the following strategic outcome: Canada's grain is safe, reliable and marketable and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies.

The CGC's Program Alignment Architecture has five programs. The Quality Assurance Program, Quantity Assurance Program, Grain Quality Research Program, and Producer Protection Program each contribute to making progress to the sole strategic outcome. The Internal Services program supports all other programs within the CGC.

The Canadian Grain Commission Revolving Fund was established under Appropriation Act No. 6, 1994–1995. The Fund has a continuing non–lapsing authority from Parliament to make payments out of the Consolidated Revenue Fund for working capital, capital acquisitions and temporary financing of accumulated operating deficits, the total of which cannot exceed $2,000,000 at any time.

The CGC received authorization from Treasury Board to access its net authority provided for a total amount up to $7,946,483 in fiscal year 2014–2015 to allow payments for severance obligations that have been expensed in previous years.

In the fall of 2012, two initiatives were announced that have impacted the services and organizational structure of the CGC. Firstly, Bill C‑45, containing proposed amendments to the Canada Grain Act, was introduced in Parliament. Secondly, on November 1, 2012, the CGC launched consultations on CGC user fees that reflected an updated Canada Grain Act and streamlined CGC operations. Bill C‑45 received Royal Assent on December 14, 2012. The amendments to the Canada Grain Act came into force on August 1, 2013. Updated user fees took effect August 1, 2013 concurrent with changes to the Canada Grain Act. In response to both the legislative changes and restructured user fees, the CGC had adjusted its workforce (Note 6), organizational design, and operations.

The revised funding model which came into effect on August 1, 2013 is based on full cost recovery through user fees and ongoing appropriations. Until the implementation of this model, the CGC was funded through its ongoing appropriations, fees collected and special appropriation.

In accordance with the Government's policy on self‑insurance, the CGC does not carry its own insurance. The CGC is not subject to income tax.

2. Significant accounting policies

The financial statements have been prepared in accordance with accounting standards issued by the Treasury Board of Canada Secretariat and the reporting requirements of the Receiver General for Canada. The basis of accounting used in these financial statements differs from generally accepted accounting principles because:

  • The liabilities for employee termination benefits and severance liability are based on management's best estimate rather than actuarial valuations; and
  • The services received without charge from other government departments and agencies are not reported as expenses.

The significant accounting policies are as follows:

a. Use of estimates

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as at the date of the financial statements and the reported amounts of revenue and expenses during the periods covered by the financial statements. The principal financial statement components subject to measurement uncertainty include salaries payable related to unsettled labour contracts, the estimated useful life of capital assets and the liabilities for employee vacation, severance benefits and employee termination benefits. Actual results could differ from those estimates. Management's estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

b. Revenue recognition

Revenue is recognized in the accounting period in which it is earned through the provision of goods or services, or when an event giving rise to a claim has taken place. The majority of service fees such as inspection and weighing activities are dependent on grain volumes handled. Revenues that have been received but not yet earned are presented as deferred revenues. Deferred revenue is primarily received for licensing fees which usually covers a 12 month period.

c. Expense recognition

Unless otherwise disclosed, expenses are recorded in the period they are incurred.

d. Cash in transit

Cash in transit includes cash and cheques received prior to March 31 but not deposited until the subsequent year.

e. Parliamentary, special and employee termination benefit appropriation

Operations are funded primarily from a permanent authority from Parliament (Revolving Fund) where the CGC is allowed to spend fees collected. Some of the operations of the Grain Quality Research Program and Internal Audit are funded by ongoing Parliamentary appropriation through their annual votes. Special appropriations were also received to cover affected employees' termination benefits. These appropriations have been recorded as revenue of the Fund.

f. Accounts receivable

Accounts receivable are stated at amounts expected to be ultimately realized. Allowances are established for all accounts for which interest or principal payments are 180 days past due.

g. Capital assets

Certain assets previously under the custody of the Department of Agriculture and Agri‑Food Canada were assumed by the Revolving Fund on April 1, 1995. The assumed assets were considered to be contributed capital and recorded at the Crown's estimated net book value. Assets acquired subsequent to April 1, 1995 were recorded at cost. Proceeds from the disposal of capital assets are retained by the Revolving Fund.

All capital assets and leasehold improvements with a cost equal to or greater than $10,000 are capitalized at their acquisition cost.

Assets are amortized on a straight‑line basis over their estimated useful lives, commencing in the month after they are put into service, as follows:

Table Summary

The table presents the tangible capital assets and consists of 2 columns: the assets categories with respective amortization periods.

Scientific equipment 5 years
Office equipment and furniture 5 years
Operational equipment 10 years
Motor vehicles 5 years
Computer equipment and software 3 years
Leasehold improvements 5 years (term of the lease)

The costs for assets under construction are capitalized as incurred with amortization commencing in the month after they are put into service.

h. Vacation, overtime and compensatory leave

Vacation, overtime and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.

i. Employee severance benefits

Severance benefits accrue to employees over their years of service with the Government of Canada as stipulated in their collective agreements. The CGC provides for the severance entitlements earned by employees. The obligation relating to the benefits earned by employees is calculated using information derived from management's estimate of the liability.

j. Employee termination benefits

Employees affected by the amendments to the Canada Grain Act are entitled to termination benefits, calculated based on salary levels in effect at the time of termination as stipulated in their collective agreements. The obligation is calculated using information derived from management's estimate of the liability.

k. Pension plan

Employees of the CGC are covered by the Public Service Superannuation Act and the Supplementary Retirement Benefits Act. The Government of Canada's portion of the pension cost is included in the employee benefit charge assessed against the Revolving Fund. The actual payment of the pension is made from the Public Service Superannuation and Supplementary Retirement Benefits Accounts. Current legislation does not require the CGC to make contributions for any actuarial deficiencies of the Public Service Superannuation account.

l. Sick leave

Employees are permitted to accumulate unused sick leave. However, such leave entitlements do not vest and may only be used in the event of illness. Unused sick leave upon employee termination is not payable to the employee. No amount has been accrued in these financial statements and payments of sick leave benefits are included in current operations as incurred.

3. Accounts receivable

Table Summary

The table presents on a comparative basis the accounts receivable. It consists of three columns: item descriptions, current year and previous year. The last row presents the totals for accounts receivable net of allowance for doubtful accounts.

(in thousands of dollars)

  2015 2014
Other government departments and agencies 292 1,251
Outside parties 8,433 8,379
Subtotal 8,725 9,630
Less: allowance for doubtful accounts from outside parties   (negative 1)
Total 8,725 9,629

4. Capital assets

Table Summary

The table presents the Capital assets with eleven columns. The first column lists the item descriptions and the next eight columns are grouped in two: cost (opening balance, acquisitions, disposals, and closing balance) and accumulated amortization (opening balance, amortization, decrease and closing balance). The last two columns provide the net book value for the current year and for the previous year. Totals are displayed on the last row.

(in thousands of dollars)

  Cost Accumulated amortization Net book value
Opening balance Acquisitions Disposals Closing balance Opening balance Amortization Decrease Closing balance 2015 2014
Scientific equipment 16,261 2,010 (negative 1,708) 16,563 12,846 1,085 (negative 1,700) 12,231 4,332 3,415
Office equipment and furniture 644   (negative 340) 304 640 3 (negative 339) 304   4
Operational equipment 2,038 378 (negative 211) 2,205 708 178 (negative 207) 679 1,526 1,330
Motor vehicles 398 28 (negative 103) 323 215 49 (negative 103) 161 162 183
Computer equipment and software 8,934 412 (negative 3,492) 5,854 7,556 845 (negative 3,427) 4,974 880 1,378
Leasehold improvements 6,945 515 (negative 981) 6,479 5,372 443 (negative 795) 5,020 1,459 1,573
Total 35,220 3,343 (negative 6,835) 31,728 27,337 2,603 (negative 6,571) 23,369 8,359 7,883

5. Accounts payable and accrued liabilities

Table Summary

The table presents on a comparative basis the accounts payable and accrued liabilities. It consists of three columns: item descriptions, current year and previous year. The last row presents the totals.

(in thousands of dollars)

  2015 2014
Other government departments and agencies 519 601
Outside parties 1,248 595
Total 1,767 1,196

6. Salaries payable

With the legislative changes to the Canada Grain Act, a segment of the CGC work force became eligible for the provision of termination benefits. As a result, the CGC has recorded an obligation for termination benefits as part of salaries payable to reflect the estimated workforce adjustment costs. As the changes were implemented, employees received their termination benefits and there is a portion of these benefits payable in future years.

Table Summary

The table presents on a comparative basis salaries payable. It consists of three columns: item descriptions, current year and previous year. Subtotals are displayed at Employee termination benefits, end of year. Totals are displayed at salaries payable.

(in thousands of dollars)

  2015 2014
Employee termination liability, beginning of year 1,666 15,887
Expense for the year 715 (negative 1,216)
Benefits paid during the year (negative 1,219) (negative 13,005)
Employee termination liability, end of year 1,162 1,666
Other salary costs including benefits 2,659 1,658
Salaries payable 3,821 3,324

7. Employee severance benefits

The CGC provides severance benefits to its employees based on eligibility, years of service and final salary. These benefits are currently calculated based on the actual severance owed to each employee.

With Budget 2011, the Government of Canada announced its intention to eliminate the ongoing accumulation of severance benefits. As collective agreements for the CGC have been are negotiated and severance benefits have ceased to accumulate. Employees are being given the option to liquidate immediately or collect upon departure from the public service.

Table Summary

The table presents on a comparative basis the employee severance benefits. It consists of three columns: item descriptions, current year and previous year. Subtotals are displayed at employee severance benefits end of year. Totals are displayed at long‑term portion of employee severance benefits.

(in thousands of dollars)

  2015 2014
Employee severance benefits liability, beginning of year 5,717 12,057
Expense for the year (negative 67) 1,027
Benefits paid during the year (negative 2,523) (negative 7,367)
Employee severance benefits liability, end of year 3,127 5,717
Current portion of employee severance benefits liability (negative 346) (negative 2,984)
Long‑term portion of employee severance benefits liability 2,781 2,733

8. Parliamentary, special and employee termination benefits appropriation

The CGC is financed by the Government of Canada through a combination of an ongoing Parliamentary appropriation, authority to re‑spend fees collected, accumulated surpluses from prior years and a revolving line of credit of $2,000,000. The government funding basis is used to recognize transactions affecting Parliamentary appropriations. The statement of operations and net assets (liabilities) is based on accrual accounting. Consequently, items presented in the statement of operations and net assets (liabilities) are not necessarily the same as those provided through appropriations from Parliament. Items recognized in the statement of operations and net assets (liabilities) in one year may be funded through Parliamentary authorities in prior, current, or future years. Accordingly, the CGC has different appropriation authorities for the year on a government funding basis than on an accrual accounting basis. Details on appropriation authorities provided and used are shown in the following tables.

Appropriation authorities provided and used:

Table Summary

The table presents on a comparative basis the appropriation authorities provided and used. It consists of three columns: item descriptions, current year and previous year. Totals are displayed at current year appropriation funds provided and used.

(in thousands of dollars)

  2015 2014
Total appropriation funds provided 9,262 37,600
Employee termination benefits:    
Frozen allotment (lapsed) (negative 10) (negative 1,686)
Under‑spent (lapsed) (negative 1,761) (negative 972)
Current year appropriation funds provided and used 7,491 34,942

Total current year appropriation funds provided and used consists of:

Table Summary

The table presents on a comparative basis the special appropriation for the total current year appropriation funds provided and used. It consists of three columns: item descriptions, current year and previous year. Totals are displayed at current year appropriation funds provided and used.

(in thousands of dollars)

  2015 2014
Special appropriation 815 16,927
Employee termination benefits appropriation 1,201 12,568
Parliamentary appropriation 5,475 5,447
Current year appropriation funds provided and used 7,491 34,942

9. Net assets (liabilities)

Contributed capital represents the value of the capital assets financed from capital contributions at the inception of the Fund.

The accumulated surplus is the accumulation of each fiscal year's surplus net of deficits since the inception of the Fund.

The accumulated net charge against the Fund's authority is the amount of the Revolving Fund's non‑lapsing authority that has been accumulated since its inception.

Table Summary

The table presents on a comparative basis the accumulated net charge against the Fund's authority. It consists of three columns: item descriptions, current year and previous year. Totals are displayed at total accumulated net charge against the Fund's authority.

(in thousands of dollars)

  2015 2014
Contributed Capital 4,941 4,941
Accumulated Surplus    
Opening balance 36,314 4,796
Net results 29,882 31,518
Transfer of the transition payments for implementing salary payments in arrears (negative 1,093)  
Closing balance 65,103 36,314
Accumulated net charge against the Fund's authority    
Opening balance (negative 35,610) (negative 29,070)
Change in net resources provided (negative 27,674) (negative 6,540)
Closing balance (negative 63,284) (negative 35,610)
Total net assets (liabilities) 6,760 5,645

10. Contractual obligations

CGC leases its premises under occupancy instruments. An occupancy instrument is a formal agreement between the CGC and Public Works and Government Services Canada recording the terms and conditions that govern the provision and occupancy of the accommodation. Expected future payouts are as follows:

Table Summary

The table presents the Contractual obligations for the next five years and thereafter. It consists of two columns: the year and the respective amount.

(in thousands of dollars)

2016 4,806
2017 4,599
2018 3,838
2019 3,749
2020 and thereafter 11,251

11. Contingent liabilities

In the normal course of its operations, CGC may become involved in various legal actions. Some of these potential liabilities may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense is recorded in the financial statements. As at March 31, 2015, there are no claims outstanding against CGC.

12. Related party transactions

The CGC is related in terms of common ownership to all Government of Canada departments, agencies and Crown corporations. The CGC enters into transactions with these entities at arm's length in the normal course of business and on normal trade terms.

Services provided by other government departments

During the year, the CGC paid occupancy costs and certain professional services to other government departments or agencies. Employer's health insurance plan contributions and employee benefit plans were also provided by and paid to other government departments. Significant services have been recognized in the CGC statement of operations and net assets (liabilities) as follows:

Table Summary

The table presents on a comparative basis related party transactions involving services provided by other government departments. It consists of three columns: item descriptions, current year and previous year. The last row presents the totals.

(in thousands of dollars)

  2015 2014
Employer's contribution to employee benefit plans 7,475 11,654
Occupancy costs 5,094 4,758
Professional and special services    
Audit and accounting services 25 137
Consulting services 99 164
Legal services 367 402
Translation services 252 287
Other 116 148
Total 13,428 17,550

Included in accounts receivable, accounts payable, and salaries payable at year end are the following amounts with related parties:

Table Summary

The table presents on a comparative basis the total accounts receivable and the total accounts payable at year end with related parties. It consists of three columns: item descriptions, current year and previous year.

(in thousands of dollars)

  2015 2014
Accounts receivable 292 1,251
Accounts payable 519 601
Employer's contribution to employee benefit plans payable 680 1,083

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

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 process. This change to the pay system had no impact on the expenses of the Revolving Fund. However, it did result in the use of authorities by the Revolving Fund and impacted the accumulated net charge against the Fund's authority. Prior to year end, 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.

14. Financial instruments

The Revolving Fund's financial instruments consist of cash in transit, accounts receivable, accounts payable and accrued liabilities, salaries payable, vacation, overtime and compensatory leave payable, and employee severance benefits. The carrying values of these financial instruments approximate their fair value because of their short terms to maturity, except for employee severance benefits and employee termination benefits which are based on management's best estimate. Unless otherwise noted, it is management's opinion that the Revolving Fund is not exposed to significant interest, currency or credit risk arising from these financial instruments.

Financial instruments that potentially subject the CGC to concentrations of credit risk consist primarily of trade accounts receivable. For the year ended March 31, 2015, six large integrated organizations accounted for $3,768,507 or 89 percent of the CGC's outside parties receivable balances (2014 — eight organizations, $3,975,128 or 89 percent).

15. Comparative information

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

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