National Film Board

Public Accounts of Canada 2015 Volume III - Top of the page Navigation

(Note: The annex mentioned in the Statement of Management Responsibility can be found on the National Film Board Web site).

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Statement of Management Responsibility

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2015, and all information contained in these statements rests with the management of the National Film Board (the "Board"). These financial statements have been prepared by management using the Government's accounting policies, which are based on Canadian public sector accounting standards. They have been approved by the Board of Trustees.

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 the Board's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in the Board'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 the Board 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 ongoing process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

The Board will be subject to periodic Core Control Audits performed by the Office of the Comptroller General and will use the results of such audits to adhere to the Treasury Board Policy on Internal Control.

In the interim, the Board has undertaken a risk‑based assessment of the system of ICFR for the year ended March 31, 2015, in accordance with the Treasury Board Policy on Internal Control, and the results and action plan are summarized in the annex which can be found on the National Film Board Website.

The Office of the Auditor General, the independent auditor for the Government of Canada, has expressed an opinion on the fair presentation of the financial statements of the Board which does not include an audit opinion on the annual assessment of the effectiveness of the Board's internal controls over financial reporting.

Approved by:

Claude Joli‑Coeur
Government Film Commissioner

Luisa Frate, CPA, CA
Director General,
Finance, Operations and Technology
Chief Financial Officer

July 10, 2015

Statement of Authority Used (Unaudited) for the year ended March 31

Table Summary

The table presents on a comparative basis the statement of Authority 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 use of funds and totals are displayed at authority used.

(in thousands of dollars)

  2015 2014
Estimates Actual Estimates Actual
Cost of operation (negative 63,894) (negative 60,715) (negative 69,289) (negative 62,466)
Add: items not requiring use of funds   3,511   (negative 1,959)
Operating use of funds (negative 63,894) (negative 57,204) (negative 69,289) (negative 64,425)
Less: items requiring use of funds        
Net capital acquisitions   3,827   2,162
Transition payments for implementing salary payments in arrears   1,108    
Net other assets and liabilities   424   279
Authority used (negative 63,894) (negative 62,563) (negative 69,289) (negative 66,866)
Annual voted authority used   (negative 61,032)   (negative 66,587)
Revolving Fund statutory authority used   (negative 1,531)   (negative 279)

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 at the end of year and the totals are displayed at unused authority carried forward.

(in thousands of dollars)

  2015 2014
Credit balance in the accumulated net charge against the Fund's authority 3,353 2,518
Payables at year‑end charged against the credit account after March 31 7,690 6,994
Net Revolving Fund statutory authority used, end of year 11,043 9,512
Revolving Fund statutory authority limit 15,000 15,000
Unused Revolving Fund statutory authority carried forward 3,957 5,488

Independent Auditor's Report

To the Minister of Canadian Heritage and Official Languages

Report on the Financial Statements

I have audited the accompanying financial statements of the National Film Board, which comprise the statement of financial position as at March 31, 2015, and the statement of operations and departmental net financial position, statement of change in departmental net debt and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian public sector accounting standards, 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.

Auditor's Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with Canadian generally accepted auditing standards. Those standards require that I 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 auditor's 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.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Opinion

In my opinion, the financial statements present fairly, in all material respects, the financial position of National Film Board as at March 31 2015, and the results of its operations, changes in its net debt, and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.

Report on Other Legal and Regulatory Requirements

In my opinion, the transactions of National Film Board that have come to my notice during my audit of the financial statements have, in all significant respects, been in accordance with the National Film Act and the by‑laws of the National Film Board.

René Béliveau, CPA auditor, CA
Principal,
for the Auditor General of Canada

Montréal, Canada
July 10, 2015

Statements 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: liabilities and assets, both displaying totals at total net liabilities and department net financial position. Item descriptions for assets are grouped in two: financial assets and non‑financial assets, both displaying subtotals at total net financial assets and total non‑financial assets.

(in thousands of dollars)

  2015 2014
Liabilities    
Accounts payable and accrued liabilities (Note 4) 6,980 6,042
Accrued salaries 1,859 530
Vacation pay 765 350
Deferred revenue 232 375
Employee future benefits (Note 5) 2,880 2,655
Total net liabilities 12,716 9,952
Financial assets    
Due from Consolidated Revenue Fund 5,694 3,896
Accounts receivable (Note 6) 2,117 2,271
Deposits 96 277
Total net financial assets 7,907 6,444
Departmental net debt 4,809 3,508
Non‑financial assets    
Prepaid expenses 461 342
Inventory 72 99
Tangible capital assets (Note 7) 7,939 6,414
Total non‑financial assets 8,472 6,855
Departmental net financial position 3,663 3,347

Approved by the Board of Trustees:

Claude Joli-Coeur
Government Film Commissioner and Chairperson

Louis Puddister
Member of the Board of Trustees

Statement of Operations and Departmental Net Financial Position for the year ended March 31

Table Summary

The table presents on a comparative basis the statement of Operations and Departmental Net Financial Position. It consists of four columns: item descriptions, current year planned results, current year and previous year. Item descriptions for the English programming expenses and French programming expenses are grouped separately, each displaying subtotals. Subtotals for expenses are displayed at total expenses which include the English programming expenses, French programming expenses and the other item descriptions related to expenses. Subtotals for revenues are displayed at total revenues. Subtotals for total expenses, net of total revenues are displayed at net cost operations before government funding. Subtotals for net cost operations before government funding, net of net cash provided by Government of Canada and change in due from Consolidated Revenue Fund are displayed at net cost of operations after government funding in the current year and previous year columns. Totals for net cost of operations after government funding, net of departmental net financial position beginning of year are displayed at departmental net financial position end of year in the current year and previous year columns.

(in thousands of dollars)

  2015
Planned results
2015 2014
Expenses (Note 10a)      
English programming      
Production of films and other forms of visual presentation      
Board's program 20,422 19,924 20,405
Sponsored production and pre‑sale 100 15 244
Subtotal 20,522 19,939 20,649
French programming      
Production of films and other forms of visual presentation      
Board's program 15,338 12,663 12,694
Sponsored production and pre‑sale 375 326 182
Subtotal 15,713 12,989 12,876
Distribution 5,759 5,987 4,912
Marketing, accessibility and outreach 11,922 13,166 13,385
Digital development and applications 5,390 2,959 5,328
Internal services 10,287 9,405 9,291
Subtotal 33,358 31,517 32,916
Total expenses 69,593 64,445 66,441
Revenues (Note 10b)      
Institutional and educational 2,500 1,629 1,442
Television 1,300 509 755
Stock shots 600 612 524
Home video 700 400 495
Sponsored production and pre‑sale 475 341 426
Theatrical 50 59 50
Miscellaneous 75 180 283
Total Revenues 5,700 3,730 3,975
Net cost of operations before government funding and transfers 63,893 60,715 62,466
Government funding and transfers      
Net cash provided by Government of Canada 62,580 60,341 65,199
Change in due from Consolidated Revenue Fund   1,798 1,388
Transfer of the transition payments for implementing salary payments in arrears (Note 12)   (negative 1,108)  
Net cost of operations after government funding and transfers 1,313 (negative 316) (negative 4,121)
Departmental net financial position ‑ beginning of year 3,347 3,347 (negative 774)
Departmental net financial position ‑ end of year 2,034 3,663 3,347

Statement of Change in Departmental Net Debt for the year ended 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 three: operating activities with subtotals at cash used in operating activities, capital investing activities with subtotals at cash used in capital investing activities and financial activities with subtotals at cash used in financial activities. Totals are displayed at net cash provided by Government of Canada which include the cash used in operating activities, the cash used in capital investing activities and the cash used in financial activities.

(in thousands of dollars)

  2015
Planned results
2015 2014
Net cost of operations after government funding and transfers 1,313 (negative 316) (negative 4,121)
Change due to tangible capital assets      
Acquisition of tangible capital assets 1,065 3,827 2,166
Amortization of tangible capital assets (negative 2,378) (negative 2,302) (negative 2,265)
Proceeds from disposal of tangible capital assets     (negative 69)
Gain on disposal of tangible capital assets     38
Total change due to tangible capital assets (negative 1,313) 1,525 (negative 130)
Change due to inventories   (negative 27) (negative 57)
Change due to prepaid expenses   119 (negative 130)
Net decrease in departmental net debt   1,301 (negative 4,438)
Department net debt ‑ beginning of year 3,508 3,508 7,946
Department net debt ‑ end of year 3,508 4,809 3,508

Statement of Cash Flows for the year ended March 31

Table Summary

The table presents on a comparative basis the statement of Change in Departmental Net Debt. It consists of four columns: item descriptions, current year planned results, current year and previous year. Item descriptions for change due to tangible capital assets are grouped together and are displaying subtotals at total change due to tangible capital assets. Subtotals for net cost of operations after government funding, net of total change due to tangible capital assets, change due to inventories and change due to prepaid expenses are displayed at net increase (decrease) in departmental net debt. Totals for net increase (decrease) in departmental net debt, net of departmental net debt beginning of year are displayed at departmental net debt end of year.

(in thousands of dollars)

  2015 2014
Operating activities    
Net cost of operations before government funding and transfers 60,715 62,466
Non‑cash items:    
Amortization of tangible capital assets (negative 2,302) (negative 2,265)
Gain on disposal of tangible capital assets   38
Transition payments for implementing salary payments in arrears 1,108  
Variations in Statement of Financial Position    
Variations in accrued salaries (negative 1,329) (negative 124)
Change in vacation pay (negative 414) (negative 30)
Net change in employee future benefits (negative 225) 3,183
Change in accounts payable and accrued liabilities (negative 938) 259
Change in financial assets other than due from Consolidated Revenue Fund (negative 336) (negative 404)
Change in deferred revenue 143 101
Change in prepaid expenses 119 (negative 130)
Change in inventory (negative 27) (negative 57)
Cash used in operating activities 56,514 63,037
Capital investing activities    
Acquisition of tangible capital assets 3,827 2,166
Proceeds from disposal of tangible capital assets   (negative 69)
Cash used in capital investing activities 3,827 2,097
Financing activities    
Lease payments for tangible capital assets   65
Cash used in financing activities   65
Net cash provided by Government of Canada 60,341 65,199

Notes to the Financial Statements for the year ended March 31, 2015

1. Authority and purposes

The National Film Board was established in 1939 under the National Film Act and is the agency responsible for administering the Act.

The National Film Board (the "Board") is a cultural agency named in Schedule I.1 of the Financial Administration Act reporting to the Minister of Canadian Heritage and Official Languages. It is administered by a Board of Trustees appointed by the Governor in Council and chaired by the Government Film Commissioner.

The Board's legislative mandate is to initiate and promote the production and distribution of films in the national interest and, in particular:

  • to produce and distribute and to promote the production and distribution of films designed to interpret Canada to Canadians and to other nations;
  • to represent the Government of Canada in its relations with persons engaged in commercial motion picture film activity in connection with motion picture films for the Government or any department thereof;
  • to engage in research in film activity and to make available the results thereof to persons engaged in the production of films;
  • to advise the Governor in Council in connection with film activities;
  • to discharge such other duties relating to film activity as the Governor in Council may direct it to undertake.

The Board is not subject to income taxes.

2. 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:

a. Parliamentary authorities

Operations are funded through a permanent authority from Parliament (Revolving Fund) and Parliamentary authorities voted annually.

The Revolving Fund allows the Board to make payments out of the Consolidated Revenue Fund for working capital, interim financing of operating costs and capital assets acquisitions. This authority requires that the aggregate of admissible working capital and net book value of capital assets does not exceed $15 million.

The Board is also financed in part by the Government of Canada through Parliamentary authorities voted annually. Financial reporting of authorities provided to the Board does 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 reconciliation between the two bases of reporting. The planned results amounts presented 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 2015–2015 Report on Plans and Priorities. The planned results amounts 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 were prepared for internal management purposes and have not been previously published.

Every year, the Board presents information on planned expenditures to Parliament through the tabling of Estimates publications. These estimates result in the introduction of supply bills (which, once passed into legislation, become appropriation acts) in accordance with the reporting cycle for government expenditures. The Board exercises expenditure initiation processes such that unencumbered balances of budget allotments and appropriations are monitored and reported on a regular basis to help ensure sufficient authority remains for the entire period and appropriations are not exceeded.

Liquidity risk is the risk that the Department will encounter difficulty in meeting its obligations associated with financial liabilities. The Board's objective for managing liquidity risk is to manage operations and cash expenditures within the appropriation authorized by Parliament or allotment limits approved by the Treasury Board.

Consistent with section 32 of the Financial Administration Act, the Board's policy to manage liquidity risk is that no contract or other arrangement providing for a payment shall be entered into with respect to any program for which there is an appropriation by Parliament or an item included in estimates then before the House of Commons to which the payment will be charged, unless there is a sufficient unencumbered balance available out of the appropriation or item to discharge any debt that, under the contract or other arrangement, will be incurred during the fiscal year in which the contract or other arrangement in entered into.

The Board's risk of exposure and its objectives, policies and processes to manage and measure this risk did not change significantly from the prior year.

b. Net cash provided by Government of Canada

The Board operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the Board is deposited to the CRF and all cash disbursements made by the Board are paid from the CRF. The net cash provided by the Government is the difference between all cash receipts and all cash disbursements including transactions between departments of the federal Government.

c. Due from or to the Consolidated Revenue Fund

Amounts due from or to the Consolidated Revenue Fund (CRF) are the result of timing differences between when a transaction affects the Board's authorities and when it is processed through the CRF. Amounts due from the CRF represent the net amount of cash that the Board is entitled to draw from the CRF without further authorities to discharge its liabilities. This amount is not considered to be a financial instrument.

d. Expense recognition

All expenses are recorded on an accrual basis.

Vacation pay is expensed as the benefits are earned by employees under their respective terms of employment.

e. Production of films and other forms of visual presentations

All production costs are charged to operations in the year in which they are incurred and are shown in the Statement of Operations and Departmental Net Financial Position as follows:

  • Board's program

    All costs incurred for unsponsored productions and co-productions or other forms of visual presentation.

    Sponsored production and pre-sale

    Part of costs incurred for film productions and co-productions or other forms of visual presentation corresponding to sponsor's contribution. The excess of costs over the sponsor's contribution is charged to the Board's program.

f. Revenues

Revenues from the production of films and other forms of visual presentation are accounted for at an amount equal to the sponsored production and pre‑sale costs during the year in which these costs are incurred. Any profit is recognized in the year the production is completed.

Royalty revenues are recognized once all of the Board's obligations have been fulfilled and its expenses have been accounted for, regardless of when the acquirer actually uses the work.

Other revenues are accounted for in the period in which the underlying transaction or event that gave rise to the revenue takes place.

g. Accounts receivable

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

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Board is not exposed to significant credit risk. The Board provides services to other government departments and agencies and to external parties in the normal course of business. Accounts receivable are due on demand. The Board's maximum exposure to credit risk is equal to the carrying value of its accounts receivable.

h. Inventory

Materials and supplies are valued at cost.

Film prints and other forms of visual presentation held for sale are valued at the lower of cost or net realizable value.

i. Tangible capital assets

All tangible capital assets having an initial cost of $5,000 or more and leasehold improvements of $10,000 or more are recorded at their acquisition cost.

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

Table Summary

The table presents tangible capital assets and consists of 2 columns: the asset class with its respective amortization period.

Asset class Amortization period
Technical equipment 4 to 10 years
Software and data processing equipment 5 to 10 years
Office furniture, equipment and other 5 to 10 years
Leasehold improvements terms of the leases

Amounts related to projects in progress are transferred to the appropriate tangible capital assets category when the project is complete and amortized according to the Board's policy.

The Board has a collection of nearly twenty thousand audiovisual works produced since 1895. This inestimable collection is not intended for sale and does not have a measurable value. It has, however, been assigned a nominal value of $1 in the financial statements, appearing on the Statement of Financial Position and in Note 7 as tangible capital assets to ensure that the reader is aware of its existence. The Board does not capitalize other intangibles that have cultural, aesthetic or historical value.

The Board enters into operating lease agreements to acquire the exclusive use of certain tangible capital assets over the term of the lease. These rental fees are charged to operations in the year to which they apply.

j. Other financial assets and financial liabilities

Financial instruments of the Board are stated at cost or amortized cost. Financial assets consist of assets that could be used to reimburse existing liabilities or finance future operations.

The Board has the following financial assets:

  • Accounts receivable related to the sale of audiovisual products to external parties or other departments and agencies (net of allowances for doubtful accounts)
  • Deposits related to production abroad

Financial liabilities consist of accounts payable and accrued liabilities and accrued salaries.

k. Employee future benefits

Pension benefits

Eligible employees participate in the Public Service Pension Plan, a multiemployer pension plan administered by the Government. The Board's contributions to the Plan are charged to expenses in the year incurred and represent the Board's total obligation to the Plan. The Board'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 are entitled to severance benefits as provided under collective agreements or conditions of employment. In 2012, the program for all employees was eliminated and, consequently, the severance benefits ceased to accumulate. The cost of severance was recorded in the periods in which the benefits were earned by employees. The obligation under severance benefits is calculated at present using the most probable management assumptions regarding wage, the discount rate and the timing of retirement. These assumptions are reviewed annually.

Compensated absences

Employees are entitled to sick leave and worker's compensation benefits as provided in their collective agreements or conditions of employment. Sick leave days accumulate but do not vest, enabling the employees to be paid during their absence in recognition of prior service rendered. As the employees render services, the value of the compensated absences attributed to those services is recorded as a liability and an expense. The Board records the cost of worker's compensation benefits to be paid when the event giving rise to the obligation occurs. Management uses assumptions and its best estimates, such as the discount rate, age of retirement, utilization rate of days in excess of the leave granted annually, probability of departure and salary review rate to calculate the present value of the compensated absences obligation. These assumptions are reviewed annually.

l. Contingent liabilities

Contingent liabilities are potential liabilities which 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 recorded. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.

m. 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 the allowance for doubtful accounts, contingent liabilities, the liability related to employee future benefits and the useful life of tangible capital assets. 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

The Board 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, the Board 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:

  1. Reconciliation of net cost of operations to current year authorities used

    Table Summary

    The table presents on a comparative basis the parliamentary authorities, more specifically the reconciliation of net cost of operations to current year authorities used. It consists of three columns: item descriptions, current year and previous year. Item descriptions for adjustments for items affecting net cost of operations but not affecting authorities are grouped together, displaying subtotals. Item descriptions for adjustments for items not affecting net cost of operations but affecting authorities are grouped together, displaying subtotals. Totals are displayed at current year authorities used.

    (in thousands of dollars)

      2015 2014
    Net cost of operations before government funding and transfers 60,715 62,466
    Adjustments for items affecting net cost of operations but not affecting authorities:    
    Add (less):    
    Gain on disposal of tangible capital assets   38
    Change in vacation pay (negative 414) (negative 30)
    Change in accrued liabilities not charged to authorities (negative 570) 1,033
    Net change in employee future benefits (negative 225) 3,183
    Amortization of tangible capital assets (negative 2,302) (negative 2,265)
    Subtotal (negative 3,511) 1,959
    Adjustments for items not affecting net cost of operations but affecting authorities:    
    Add (less):    
    Acquisition of tangible capital assets 3,827 2,166
    Lease payments for tangible capital assets   65
    Proceeds from disposal of tangible capital assets   (negative 69)
    Transition payments for implementing salary payments in arrears (Note 12) 1,108  
    Subtotal 4,935 2,162
    Current year authorities used 62,139 66,587
  2. Authorities provided and used

    Table Summary

    The table presents on a comparative basis the parliamentary authorities more specifically the authorities provided and used. It consists of three columns: item descriptions, current year and previous year. Totals are displayed on the last row.

    (in thousands of dollars)

      2015 2014
    Authorities provided    
    Vote 75 ‑ Main Estimates 59,912 62,890
    Supplementary Estimates authorities 4,506 6,398
    Less:    
    Authorities available for future years (negative 2,246) (negative 2,701)
    Frozen allotment (negative 33)  
    Current year authorities used 62,139 66,587

4. Accounts payable and accrued liabilities

Accounts payable and accrued liabilities are measured at cost and are due, mainly, within six months following the closing date.

The following table presents details of the Board's accounts payable and accrued liabilities.

Table Summary

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

(in thousands of dollars)

  2015 2014
Other government departments and agencies 1,132 1,258
External parties 4,848 4,722
Total accounts payable 5,980 5,980
Accrued liabilities 1,000 62
Total accounts payable and accrued liabilities 6,980 6,042

In March 2015, the Board announced a reorganization of its operations. As a result, the Board has recorded at March 31, 2015, an obligation for termination benefits in the amount of $1,000,144 in its accrued liabilities for estimated workforce adjustment costs. In 2014, the accrued liability corresponds to the liability balance linked to the workforce adjustment following the savings measures announced in Canada's Economic Action Plan 2012.

5. Employee future benefits

Pension benefits

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

Both the employees and the Board contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to the 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.

In 2015, the expense amount for Group 1 and Group 2 members of $3,376,831 (2014 — $3,591,936) represents approximately 1.5 times (2014 — 1.7 times) the employee contributions.

The Board'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 and compensated absences

Severance benefits

The Board 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 collective agreement negotiations and conditions of employment, the accumulation of severance benefits under the employees' severance pay program ceased commencing in 2012. Employees subject to these changes had, until December 31, 2013, 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. As at March 31, 2015, to calculate the obligation of the remaining portion, the Board uses a rate of compensation increase of 0.96 percent (2014 — 2.70 percent), an estimated discount rate of 1.65 percent (2014 — 2.71 percent) and a horizon of retirement estimated at maximum of 13 years (15 years in 2014).

Compensated absences

The Board provides its employees with sick leave benefits based on their salary and the entitlements accumulated over their years of service. These entitlements are accumulated but do not vest. As of March 2015, the Board has also recognized a worker's compensation obligation.

To calculate the obligation of sick leaves, the Board uses an average daily wage of $287 (2014 — $280), a rate of salary increase of 0.96 percent (2014 — 2.70 percent), an average annual utilization rate of 2.80 percent (2014 — 2.48 percent), a discount rate of 1.65 percent (2014 — 2.71 percent), a 5.00 percent (2014 — 4.90 percent) probability of employee departure and a retirement age assumption of 60.

To calculate the workers' compensation obligation, the Board uses the provisions of the applicable workers' compensation plan and a discount rate of 1.65 percent.

Information about the severance and sick leave benefits, measured as at March 31, 2015, is as follows:

Table Summary

The table presents employee future benefits related to severance and sick leave benefits. It consists of four columns: item descriptions, severance benefits, compensated absences and total. Subtotals are displayed at balance as at March 31 of the previous year. Totals are displayed at balance as at March 31 of the current year.

(in thousands of dollars)

  Severance benefits Compensated Absences Total
Balance as at March 31, 2013 4,542 1,296 5,838
Expense for the year (negative 248) 142 (negative 106)
Benefits paid during the year (negative 3,077)   (negative 3,077)
Balance as at March 31, 2014 1,217 1,438 2,655
Expense for the year 22 525 547
Benefits paid during the year (negative 295) (negative 27) (negative 322)
Balance as at March 31, 2015 944 1,936 2,880

6. Accounts receivable

The following table presents details of the Board's 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. Totals are displayed at total accounts receivable.

(in thousands of dollars)

  2015 2014
Other government departments and agencies 494 506
External parties 1,971 2,008
Subtotal 2,465 2,514
Allowance for doubtful accounts on receivables from external parties (negative 348) (negative 243)
Total accounts receivable 2,117 2,271

7. Tangible capital assets

Table Summary

The table presents the tangible capital assets, with six columns. The first column lists the item descriptions and the next five columns are grouped in two: cost (opening balance, additions, disposals & write‑offs, Transfers and closing balance) and accumulated amortization (opening balance, amortization, disposals & write‑offs, Transfers and closing balance). The last row provides the net book value for the current year and for previous year.

(in thousands of dollars)

  Balance at March 31, 2014 Additions Disposals and Write-offs Transfers Balance at March 31, 2015
Cost          
Technical Equipment 26,440 590 (negative 7,358)   19,672
Software & data processing equipment 13,539 1,471 (negative 888) 403 14,525
Office furniture, equipment & other 603 8 (negative 22)   589
Leasehold improvements 6,649 231   52 6,932
Collection 1       1
Work in progress 455 1,527   (negative 455) 1,527
Total 47,687 3,827 (negative 8,268)   43,246
Accumulated Amortization Balance at March 31, 2014 Amortization Disposals and Write-offs Transfers Balance at March 31, 2015
Technical Equipment (negative 24,680) (negative 900) 7,358   (negative 18,222)
Software & data processing equipment (negative 10,828) (negative 891) 888   (negative 10,831)
Office furniture, equipment & other (negative 593) (negative 4) 22   (negative 575)
Leasehold improvements (negative 5,172) (negative 507)     (negative 5,679)
Total (negative 41,273) (negative 2,302) 8,268   (negative 35,307)
Net book value 6,414       7,939

8. Contractual obligations

The nature of the Board's activities can result in multi‑year contracts and obligations whereby the Board will be obligated to make future payments for the acquisition of goods or services. Significant contractual obligations that can be reasonably estimated are summarized as follows:

The agreements for leased premises total to $5,830,176 were signed with Public Works and Government Services Canada.

Table Summary

The table presents the contractual obligations from 2016 to 2018 and the total of these obligations from 2020 to 2031. It consists of four columns: year, premises, other goods and services and total of the two previous columns. The totals of each columns are displayed the last line.

(in thousands of dollars)

  Premises Other goods and services Total
2016 1,484 1,337 2,821
2017 1,184 345 1,529
2018 505 47 552
2019 510 11 521
2020 to 2031 2,147 7 2,154
Subtotal 5,830 1,747 7,577

9. Contingent liabilities

The Board is subject to various legal claims arising in the normal course of its operations. In management's view, the ultimate disposition of these claims is not expected to have a material impact on the financial statements.

10. Expenses by major object and types of revenues

The following table presents the expenses committed and revenues generated by main expenditures and objects and types of revenues.

a. Expenses

Table Summary

The table presents on a comparative basis expenses by major object. It consists of three columns: item descriptions, current year and previous year. Totals are displayed on the last row.

(in thousands of dollars)

  2015 2014
Salaries and benefits 37,027 37,374
Professional and special services 9,897 10,758
Rentals 6,719 7,232
Transportation and communication 2,765 3,131
Amortization of tangible capital assets 2,302 2,265
Materials and supplies 1,588 1,527
Cash financing in co‑productions 1,225 877
Repairs and upkeep 933 1,077
Royalties 796 1,058
Contracted film production and laboratory processing 517 481
Information 436 565
Miscellaneous 240 134
Gain on disposal of tangible capital assets   (negative 38)
Total 64,445 66,441

b. Revenues

Table Summary

The table presents on a comparative basis revenues by types. It consists of three columns: item descriptions, current year and previous year. Totals are displayed on the last row.

(in thousands of dollars)

  2015 2014
Royalties 1,984 2,067
Film prints 613 675
Stock shots 612 524
Sponsored production and pre‑sale 341 426
Miscellaneous 180 283
Total 3,730 3,975

11. Related party transactions

The Board is related as a result of common ownership, to all government departments, agencies and Crown corporations. The Board enters into transactions with these entities in the normal course of business and on normal trade terms. During the year ending March 31, 2015, the Board leased premises from Public Works and Government Services Canada for the amount of $5,638,560 (2014 — $6,777,346).

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

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
Accounts receivable ‑ Other government departments and agencies 495 506
Accounts payable ‑ Other government departments and agencies 1,132 1,258
Expenses ‑ Other government departments and agencies 14,148 15,320
Revenues ‑ Other government departments and agencies 487 547

12. 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 processes. 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.

13. The Documentary Channel

Since 2002, the National Film Board owns a permanent share of 14 percent (14 x $1 units) of the specialized television channel The Documentary Channel. Pursuant to the investment agreement, the National Film Board's obligations with respect to debts, liabilities, and other obligations are limited to the capital invested.

Revenues from portfolio investments are recognized only to the extent that they are received or eligible and they are presented under miscellaneous revenues in the income statement in the amount of $136,788 (2014 — $177,546).

14. Comparative information

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

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