Future-Oriented Financial Statement

Future-Oriented Statement of Operations (Unaudited)

CANADA INDUSTRIAL RELATIONS BOARD

For the year ending March 31
(in thousands of dollars)
Estimated Results 2013–14 Planned Results 2014–15
Expenses
Adjudicative and Dispute Resolution Program 11,813 12,573
Internal Services 5,016 4,994
Total Expenses 16,829 17,567
Revenues
Miscellaneous revenues 0 0
Revenues earned on behalf of government - -
Total Revenues 0 0
Net Cost of Operations 16,829 17,567

Information for the year ending March 31, 2014, includes actual amounts from April 1, 2013, to December 31, 2013.

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

Notes to Future-Oriented Financial Statements (Unaudited)

CANADA INDUSTRIAL RELATIONS BOARD

1. Authority and Objective

The Canada Industrial Relations Board (the CIRB or the Board) contributes to and promotes a harmonious industrial relations climate in federally regulated sectors and seeks to provide effective and appropriate dispute resolution services for its client community in a fair and timely manner. Established in 1999 to replace the previous Canada Labour Relations Board, the CIRB is an independent, representative, quasi-judicial tribunal, responsible for the interpretation and application of Part I of the Canada Labour Code (the Code), which establishes the framework for collective bargaining, the acquisition and termination of bargaining rights, determination of unfair labour practices and protection of public health and safety in the event of work stoppages affecting essential services. The Board also administers certain provisions of Part II of the Code related to Occupational Health and Safety. Since April 1, 2013, the Board is also responsible for the interpretation and application of Part II of the Status of the Artist Act.

According to the approved Program Alignment Architecture (PAA), the Statement of Operations was detailed by the following Programs (Business Lines):

Adjudicative and Dispute Resolution Program
Through this program, the CIRB resolves labour relations issues by exercising its statutory powers relating to the application and interpretation of Part I (Industrial Relations), and certain provisions of Part II (Occupational Health and Safety), of the Code. Activities include the granting, modification and termination of bargaining rights; the investigation, mediation and adjudication of complaints alleging violation of Part I of the Code; the determination of level of services required to be maintained during a work stoppage; the exercise of ancillary remedial authority; the exercise of cease and desist powers in cases of unlawful strikes or lockouts; the settlement of the terms of a first collective agreement; the provision of administrative services to support these activities.

Internal Services
Internal Services are groups of activities and resources that are administered to support the operational needs of the Board's adjudicative and dispute resolution program and other corporate obligations of the CIRB, including Central Agency requirements. These groups are: management and oversight services; human resources services; financial and administrative services (including facilities, materiel and procurement services); information management (IM) services; information technology (IT) services.

2. Significant Assumptions

The future-oriented financial statements have been prepared on the basis of the government priorities and the plans of the CIRB as described in the Report on Plans and Priorities.

The estimated results for fiscal year 2013–14 are based on actual results as at December 31, 2013 and forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for the 2014–15 fiscal year.

The main assumptions underlying the forecasts are as follows:

  1. The department's activities will remain substantially the same as for the previous year.
  2. Expenses and revenues, including the determination of amounts internal and external to the government, are based on historical experience. The general historical pattern is expected to continue.

These assumptions are adopted as at January 31, 2014.

3. Variations and Changes to the Forecast Financial Information

While every attempt has been made to accurately forecast final results for the remainder of 2013–14 and for 2014–15, actual results achieved for both years are likely to vary from the forecast information presented, and this variation could be material.

In preparing this future-oriented financial statement of operations, the CIRB has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Factors that could lead to material differences between the future-oriented financial statements and the historical financial statements include:

  1. Effect of timing and amounts of acquisitions and disposals of equipment on gains/losses and amortization expense.
  2. Implementation of new collective agreements.
  3. Further changes to the operating budget through additional new initiatives or technical adjustments later in the year.
  4. Changes in standard rate used by Treasury Board to calculate employee benefits.

Once the Report on Plans and Priorities is presented, the CIRB will not be updating the forecasts for any changes in financial ressources made in ensuing supplementary estimates. Variances will be explained in the Departmental Performance Report.

4. Summary of Significant Accounting Policies

The future-oriented statement of operations has been prepared using Government’s accounting policies that came into effect for the 2012–13 fiscal year which are based on Canadian public sector accounting standards. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian public sector accounting standards.

Significant accounting policies are as follows:

  1. Expenses - are recorded on the accrual basis:

    Expenses are recorded on an accrual basis. Expenses for the CIRB operations are recorded when goods are received or services are rendered including services provided without charges for accommodation, employee contributions to health and dental insurance plans, legal services and worker’s compensation which are recorded as expenses at their estimated cost. Vacation pay and compensatory leave as well as severance benefits are accrued and expenses are recorded as the benefits are earned by employees under their respective terms of employment.

    Expenses also include provisions to reflect changes in the value of assets, including provisions for bad debt on accounts receivable, provision for valuation on loans, investments and advances and inventory obsolescence or liabilities, including contingent liabilities and environmental liabilities to the extent the future event is likely to occur and a reasonable estimate can be made.

    Expenses also include amortization of tangible capital assets which are capitalized at their acquisition cost. Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset.

  2. Revenues

    Revenues from regulatory fees are recognized in the accounts based on the services provided in the year.

    Other 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 the CIRB’s liabilities. While the Deputy Head is expected to maintain accounting control, he or she has no authority regarding the disposition of non-respendable revenues. As a result, non-respendable revenues are considered to be earned on behalf of the Government of Canada and are therefore presented in reduction of the entity’s gross revenues.

5. Parliamentary Authorities

The CIRB is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to the CIRB do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Items recognized in the Future-Oriented Statement of Operations in one year may be funded through parliamentary authorities in prior, current, or future years. Accordingly, the CIRB has different net cost 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 requested authorities:
(in thousands of dollars) Estimated 2013–14 Planned 2014–15
Net cost of operations 16,829 17,567
 
Adjustments for items affecting net cost of operations but not affecting authorities:
Services provided without charge by othe governement departements (3,801) (3,858)
Amortization of tangible capital assets (480) (605)
Decrease in employee future benefits 92 92
Increase in vacation pay and compensatory leave (2) (2)
Revenue not available for spending 0 0
Refunds of previous year's expenditures 62 40
  (4,129) (4,333)
 
Adjustments for items not affecting net cost of operations but affecting appropriations:
Acquisitions of tangible capital assets 115 365
Forecasted current year lapse 1,662 596
Requested authorities 14,477 14,194

(b) Authorities requested:
(in thousands of dollars) Estimated 2013–14 Planned 2014–15
Authorities requested
Vote 10 – Operating expenditures 11,917 11,824
Vote 15 – Compensation adjustments 66 -
Vote 25 – Operating budget carry forward 571 596
Vote 30 – Reimbursement of eligible paylist expenditures 286 234
Statutory contributions to employee benefit plans 1,637 1,540
Authorities requested 14,477 14,194

6. 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, the Board received common services which were obtained without charge from other government departments as disclosed below.

  1. Common services provided without charge by other government departments
    During the year, the Board received services without charge from certain common service organizations, related to accommodation, legal services and the employer’s contribution to the health and dental insurance plans. These services provided without charge have been recorded in the Board’s Statement of Operations and Departmental Net Financial Position as follows:

    (in thousands of dollars) Estimated Results 2013–14 Planned Results 2014–15
    Accommodation 2,988 3,033
    Employer's contribution to the health and dental insurance plans 803 815
    Legal services 10 10
    Total 3,801 3,858

    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, are not included in the Board's Future-Oriented Statement of Operations.

7. Segmented Information

Presentation by segment is based on the Board’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 4. The following table presents the expenses incurred and revenues generated for the main programs, by major object of expense and by major type of revenue. The segment results for the period are as follows:

(in thousands of dollars) Estimated Results 2013–14 Adjudicative and Dispute Resolution Program Internal Services Planned Results 2014–15
Operating expenses
Salaries and employee benefits 11,355 8,570 3,264 11,834
Accommodation 2,988 2,197 836 3,033
Travel and relocation 551 567 91 657
Amortization of tangible capital assets 480 - 605 605
Professional and special services 698 510 81 591
Equipment 50 221 35 257
Utilities, materials and supplies 125 114 18 132
Equipment rentals 230 107 17 124
Repairs and maintenance 25 72 11 83
Information 55 14 2 16
Other 271 202 32 234
Total expenses 16,829 12,573 4,994 17,567
         
Miscellaneous revenues 0 - 0 0
Revenues earned on behalf of government - - - -
Total revenues 0 - 0 0
         
Net cost of operations 16,826 12,573 4,994 17,567
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