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Future-Oriented Statement of Operations for the Canadian Food Inspection Agency (Unaudited)

for the year ending March 31
(in thousands of dollars)
Forecast
Results
2019-20
Planned
Results
2020-21
Expenses

Safe food and healthy plants and animals

687,583 725,099

Internal Services

165,497 173,413
Total expenses 853,080 898,512
Revenues

Inspection fees

37,070 37,060

Registrations, permits, certificates

8,571 8,591

Miscellaneous fees and services

5,326 5,146

Establishment license fees

1,897 1,894

Administrative monetary penalties

745 635

Grading

93 91

Interest

9 7

Revenues earned on behalf of Government

(550) (424)
Total revenues 53,161 53,000
Net cost of operations before government funding and transfers 799,919 845,512

The accompanying notes form an integral part of this Future-Oriented Statement of Operations.

Siddika Mithani, Ph.D.
President

Ottawa, Canada
Date: January 30, 2020

Dominique Osterrath, CPA, CA
Vice-President, Corporate Management
Branch and Chief Financial Officer

Date: January 30, 2020

1. Methodology and significant assumptions

The Future-Oriented Statement of Operations has been prepared on the basis of the government priorities and the Canadian Food Inspection Agency (the Agency) plans as described in the Departmental Plan.

The information in the forecast results for fiscal year 2019-20 is based on actual results as at December 31, 2019 and on forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for the fiscal year 2020-21.

The main assumptions underlying the forecasts are as follows:

These assumptions are made as at December 31, 2019.

2. Variations and changes to the forecast financial information

Although every attempt has been made to forecast final results for the remainder of 2019-20 and for 2020-21, actual results achieved for both years are likely to differ from the forecast information presented, and this variation could be material.

In preparing this Future-Oriented Statement of Operations, the Agency has made estimates and assumptions about the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are based on past experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances, and are continually evaluated.

Factors that could lead to material differences between the Future-Oriented Statement of Operations and the historical statement of operations include:

After the Departmental Plan is tabled in Parliament, the Agency will not be updating the forecasts for any changes in financial resources made in ensuing supplementary estimates. Variances will be explained in the Departmental Results Report.

3. Summary of Significant Accounting Policies

The Future-Oriented Statement of Operations has been prepared using the Government of Canada's accounting policies in effect for fiscal year 2019-20, and is 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) Expenses

Transfer payments are recorded as an expense in the year the transfer is authorized and all eligibility criteria have been met by the recipient.

Other expenses are generally recorded when goods are received or services are rendered and include expenses related to personnel, professional and special services, repair and maintenance, utilities, materials and supplies, as well as amortization of tangible capital assets. Provisions to reflect changes in the value of assets or liabilities, such as provisions for bad debts, and inventory obsolescence, as well as utilization of inventories and prepaid expenses, and other are also included in other expenses.

b) Revenues

Revenues from regulatory fees, permits and certificates are recognized based on the services provided in the fiscal year.

Funds received from external parties for specified purposes are recorded upon receipt as deferred revenue. These revenues are recognized in the period in which the related expenses are incurred.

Deferred revenue consists of amounts received in advance of the delivery of goods and rendering of services that will be recognized as revenue in a subsequent fiscal year as it is earned.

Other revenues are recognized in the period the event giving rise to the revenues occurred. Revenues that are non-respendable are not available to discharge the Agency's liabilities. Although the deputy head is expected to maintain accounting control, he or she has no authority over 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 as a reduction of the Agency's gross revenues.

4. Parliamentary Authorities

The Agency is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to the Agency differs from financial reporting according to generally accepted accounting principles because authorities are based mainly 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 Agency 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)
Forecast
results
2019-20
Planned
results
2020-21
Net cost of operations before government funding and transfers 799,919 845,512
Adjustment for items affecting net cost of operations but not affecting authorities

Amortization of tangible capital assets

(41,898) (48,727)

Gain (loss) on disposal of tangible capital assets

97 161

Services provided without charge by other government departments

(72,521) (72,248)

Increase (decrease) in prepaid expenses

1,759 1,512

Increase (decrease) in inventory

(82) (95)

Decrease (increase) in vacation pay and compensatory leave

1,247 (541)

Spending of revenues pursuant to Section 30 of the CFIA act

53,161 53,000

Decrease (increase) in employee future benefits

419 2,006

Decrease (increase) in allowance for Expired Collective Agreements

3,956 (21,217)

Decrease (increase) in allowance for bad debt expense

21 (124)

Post-capitalization of tangible capital assets

42 125

Total items affecting net cost of operations but not affecting authorities

(53,799) (86,148)
Adjustment for items not affecting net cost of operations but affecting authorities

Acquisition of tangible capital assets

24,467 23,028

Proceeds from disposal of tangible capital assets

(356) (380)

Total items not affecting net cost of operations but affecting authorities

24,111 22,648
Requested authorities forecasted to be used 770,231 782,012
(b) Authorities requested (in thousands of dollars)
Forecast
results
2019-20
Planned
results
2020-21
Authorities requested

Vote 1: operating expenditures

612,652 603,021

Vote 5: capital expenditures

27,467 23,028

Statutory contributions to employee benefits plans

82,622 77,463

Statutory compensation payments

12,500 12,500

Statutory authority for spending of revenues pursuant to section 30 of the CFIA Act Table Note 1

70,990 66,000
Total authorities requested 806,231 782,012
Less: Estimated unused authorities

Vote 1: operating expenditures

20,000 0

Vote 5: capital expenditures

3,000 0

Statutory authority for spending of revenues pursuant to section 30 of the CFIA Act

13,000 0
Requested authorities forecasted to be used 770,231 782,012

Table Note

Table Note 1

The statutory authority for spending of revenues includes the portion available from prior years (amounts of $17,828,995 and $13,000,000 for fiscal years 2019-20 and 2020-21, respectively). Those amounts are in addition to the Main Estimates figure ($53,161,000 and $53,000,000, respectively) for that statutory authority.

Return to table note 1  referrer

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