Financial Statements Highlights
The financial highlights are intended to provide a general overview of the Department’s financial position and the net cost of operations before government funding and transfers. The financial highlights presented in this section are drawn from NRCan’s financial statements and have been prepared in accordance with Treasury Board accounting policies, which are based on Canadian public sector accounting standards.
Condensed Statement of Operations and Departmental Net Financial Position
|2012-13 Planned Results||2012-13 Actual||2011-12 Actual||$ Change
(2012-13 Planned vs. Actual)
(2012-13 Actual vs. 2011-12 Actual)
|Net cost of operations before government funding and transfers||2,756||1,938||3,450||818||(1,512)|
|Departmental net financial position||(1,060)||(1,119)||(59)|
Total expenses were $3.460 billion in 2011-12 compared to $1.964 billion in 2012-13 for a net decrease of $1.496 billion or 43%, which is fully attributable to transfer payments. The operating expenses have remained constant between 2011-12 and 2012-13 (respectively $889 million and $890 million). The net decrease in transfer payments can be mainly explained as follows:
- $749 million or 50% of the reduction is due to reduction in payments from 2011-12 to 2012-13 to the Newfoundland Offshore Petroleum Resource Revenue Fund ($494 million), to the Nova Scotia Offshore Revenue Account ($102 million), to the Crown Share Adjustment Payments for Nova Scotia Offshore Petroleum Resources ($59 million), to the Clean Energy Fund ($67 million) and to ecoENERGY for Biofuels ($27 million);
- The variance in Royalties collected and paid to the Newfoundland Offshore Petroleum Resource Revenue Fund and to the Nova Scotia Offshore Revenue Account is, from year to year, entirely a function of such factors as production levels, commodity prices and operator costs.
- $688 million or 46% of the reduction is attributable to a number of large transfer payment programs that have ended in 2011-12, mainly ecoENERGY Retrofit – Homes ($198 million in 2011-12), Pulp and Paper Green Transformation Program ($450 million in 2011-12) and ecoENERGY Technology and Innovation ($40 million).
The revenues have remained constant from 2011-12 ($25 million) to 2012-13 ($26 million). The planned revenues were based on historical data.
Transferred operations in 2011-12 represent the transfer by the Department to Shared Services Canada (SSC) on November 15, 2011, of the responsibility for providing email, data centre and network services. For 2011-12, the $14.8 million represents the expenses incurred by the Department for SSC’s activities for the period April 1 to November 14, 2011, where the transfer of activities to SSC became effective. In 2012-13, SSC incurred these expenditures and reported these on their financial statements.
The planned results presented are derived from the amounts presented in the 2012-13 future-oriented statement of operations and included in the 2012-13 Departmental Report on Plans and Priorities. The planned results were based on several assumptions and information known at that time.
The difference in total expenses between the 2012-13 actual ($1,964 million) and the 2012-13 planned results ($2,794 million) is $830 million or 29% of overestimated expenses. This is attributable in part to a $510 million decrease in the statutory programs, specifically to the unforeseen decrease in offshore payments of $451 million and $59 million for the statutory grant payment to the Canada Foundation for Sustainable Development Technology. It is also attributable to a decrease in Grants and Contributions of $319 million attributable to lapsed programs mostly attributable to the Clean Energy Fund Program ($127 million), to ecoENERGY for Biofuels ($106 million) and to the Grant to the Canada Foundation for Sustainable Development Technology ($63 million).
Condensed Statement of Financial Position
|Total net liabilities||1,769||2,361||(592)|
|Total net financial assets||462||928||(466)|
|Departmental net debt||1,307||1,433||(126)|
|Total non-financial assets||248||314||(66)|
|Departmental net financial position||(1,059)||(1,119)||60|
Total net liabilities have varied from $2.361 billion in 2011-12 to $1.769 billion in 2012-13 resulting in a net decrease of $592 million or 25%. $589 million of the $592 million is attributable to:
- A decrease of $369 million in accounts payable and accrued liabilities attributed mostly to terminated transfer payment programs in 2011-12 for which payables were not set up in 2012-13;
- A decrease of $180 million in transfer payment holdbacks explained by the release of holdbacks as transfer payment program are terminated;
- A decrease of $50 million in environmental liabilities;
- Increases of $32 million in the allowance for contingent liabilities;
- A decrease of $16 million in estimated workforce adjustment costs;
- A decrease of $14 million in employee future benefits, mainly due to the elimination of severance pay for certain groups of government employees; and
- An increase of $8 million in payables to other government departments.
Total net financial assets have decreased by $466 million or 50% (from $928 million in 2011-12 to $462 million in 2012-13). The decrease is mainly attributable to the decrease in the account Due from Consolidated Revenue Fund (CRF) of $468 million, which represents cash the Department is entitled to draw from without further appropriations. The decrease in the transfer payment holdbacks and the decrease of accounts payable and accrued liabilities as indicated above are the main contributors to the decrease in the account Due from CRF.
The overall change in total net liabilities and total net financial assets are then reflected in the Departmental net debt.
Total non-financial assets, which include prepayments, inventory and tangible capital assets varied from $314 million in 2011-12 to $248 million in 2012-13, resulting in a net decrease of $66 million. A decrease of $80 million in prepayments offset by a net increase of $14 million in tangible capital assets explains that variance. The decrease of $80 million in prepayments is the result of a change in accounting policy required with the adoption of the Treasury Board accounting policy 3.2 – Transfer Payments, which translated into expensing in 2012-13 of $85 million in transfer payment prepayments.
The total non-financial assets are then subtracted from the Departmental net debt to reflect the Departmental net financial position.
Supplementary Information Tables
Details on Transfer Payment Programs
- TPP_exceeding $5 million_ecoENERGY for Biofuels
- TPP_exceeding $5 million_ICFS
- TPP_exceeding $5 million_ITAP
- TPP_exceeding $5 million_NL Offshore Petroleum Resource Revenue Fund
- TPP_exeeding $5 million_clean energy fund
- TPP_exeeding $5 million_Departmental Class Grant
- TPP_exeeding $5 million_ecoENERGY for renewable power
- TPP_exeeding $5 million_ecoEnergy innovation initiative
- TPP_exeeding $5 million_IFIT
- TPP_exeeding $5 million_NS crown share adjustment payments regs
- TPP_exeeding $5 million_payments to the NS offshore revenue account
- TPP_exeeding $5 million_WPPI contribution program
Up-Front Multi-Year Funding
- Multi_Year_Funding_Green Municipal Fund
- Multi_Year_Funding_SDTC NextGen Biofuels
- Multi_year_SDTC_SD Tech Fund
Tax Expenditures and Evaluations Report
The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance publishes cost estimates and projections for these measures annually in the Tax Expenditures and EvaluationsFootnote80 publication. The tax measures presented in the Tax Expenditures and Evaluations publication are the sole responsibility of the Minister of Finance.
- Date Modified: