Future-Oriented Financial Statements for the Years Ending March 31, 2010 and March 31, 2011

The Office of the Registrar of the Supreme Court of Canada

Statement of Management Responsibility
Future-Oriented Statement of Operations (Unaudited)
Notes to Future-Oriented Financial Information

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Statement of Management Responsibility

Responsibility for the compilation, content, and presentation of the accompanying future-oriented financial information for the years ended March 31, 2010 and March 31, 2011 rests with departmental management. The future-oriented financial information has been prepared by management in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector. The future-oriented financial information is submitted for Part III of Estimates (Report on Plans and Priorities), and will be used in the department's Departmental Performance Report to compare with actual results.

Management is responsible for the integrity and objectivity of the information contained in future-oriented financial information and for the process of developing assumptions. Assumptions and estimates are based upon information available and known to management at the time of development, reflect current business and economic conditions, and assume a continuation of current governmental priorities and consistency in departmental mandate and strategic objectives.  Much of the future-oriented financial information is based on these assumptions, best estimates, and judgment and gives due consideration to materiality.  At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. However, as with all such assumptions, there is a measure of uncertainty surrounding them. This uncertainty increases as the forecast horizon extends.

The actual results achieved for the fiscal years covered in the accompanying future-oriented financial information will vary from the information presented and the variations may be material. (Note:  The department is preparing these statements as part of a two year pilot project and readers should be cautioned that this is the second year of the pilot.)

 

Roger Bilodeau, Q.C.
Registrar
Ottawa, Ontario
February 9, 2010

 

Lynn Potter
Director General,
Corporate Services
Ottawa, Ontario
February 4, 2010

Future-Oriented Statement of Operations (unaudited)

For the Year Ended March 31
(in thousands of dollars)

	Process Hearings 2011	Internal Services 2011	Total Forecast 2011
Salaries and benefits	19,523	5,896	25,419
Professional services	5,129	1,294	6,423
Accommodation	3,601	1,471	5,071
Amortization of tangible capital assets	-	1,937	1,937
Materials, office supplies and equipment	291	339	631
Library materials	1,153	2	1,155
Travel	712	36	747
Telecommunications services	226	107	333
Equipment rentals	149	58	207
Repairs & maintenance	20	60	80
Printing services	187	6	193
Postage and courier	50	10	60
Other	19	11	31
Total expenses	31,059	11,227	42,286
Less: Revenues	200	-	200
Net cost of Operations	30,859	11,227	42,086

For the Year Ended March 31
(in thousands of dollars)

	Process Hearings 2010	Internal Services 2010	Total Forecast 2010
Salaries and benefits	19,295	5,614	24,909
Professional services	4,909	1,277	6,186
Accommodation	3,343	1,366	4,709
Amortization of tangible capital assets	-	2,055	2,055
Materials, office supplies and equipment	289	336	625
Library materials	1,138	2	1,140
Travel	705	36	740
Telecommunications services	221	105	326
Equipment rentals	146	57	203
Repairs and maintenance	20	59	79
Printing services	183	6	189
Postage and courier	49	10	59
Other	19	11	30
Total expenses	30,316	10,934	41,250
Less: Revenues	200	-	200
Net cost of Operations	30,116	10,934	41,050

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

Notes to Future-Oriented Financial Information for the years ended March 31, 2010 and March 31, 2011

1. Authority and Objectives

The Supreme Court of Canada was constituted in 1875 by an act of Parliament and is now governed by the Supreme Court Act. It is comprised of a Chief Justice and eight puisne judges (puisne meaning ranked after), all appointed by the Governor in Council for terms of "good behaviour".

The mandate of the Supreme Court of Canada is to have and exercise an appellate, civil and criminal jurisdiction within and throughout Canada. As the final court of appeal, the Supreme Court of Canada serves Canadians by leading the development of common and civil law through its decisions on questions of public importance.

The Supreme Court of Canada is committed to the Rule of Law, independence, impartiality and accessibility to justice. The Office of the Registrar of the Supreme Court of Canada supports the Supreme Court of Canada by providing responsive administrative services; nurturing the dedication, pride and professionalism of its employees; respecting diversity and linguistic duality, and collaborating with other courts and legal institutions.

The Supreme Court of Canada is one of Canada's most important national institutions. It hears appeals from courts of appeal of the provinces and territories as well as from the Federal Court of Appeal. In addition, the Supreme Court of Canada is required to give its opinion on any question referred to it by the Governor in Council.

The importance of the decisions of the Supreme Court of Canada for Canadian society is well recognized. The Supreme Court of Canada assures uniformity, consistency and correctness in the articulation, development and interpretation of legal principles throughout the Canadian judicial system. Its jurisdiction is derived from the Supreme Court Act and other Acts of Parliament such as the Criminal Code.

2. Underlying Assumptions

These future-oriented statements have been prepared: 

• as at January 12, 2010
• on the basis of government policies, government priorities, and external environment at the time the future-oriented financial information was finalized
• according to requirements of Treasury Board Accounting Policies which are based on Canadian generally accepted accounting principles for the public sector
• on the basis that the resources provided will enable the Office of the Registrar of the Supreme Court of Canada to deliver the expected results specified in the Report on Plans and Priorities
• on the basis of historical cost and trend analysis

3. Variations and Changes to the Forecast Financial Information

While every attempt has been made to accurately forecast final results for 2009/10 and 2010/11, actual results achieved are likely to vary from the forecast information presented, and this variation could be material.

Once the Report on Plans and Priorities is presented, the Office of the Registrar of the Supreme Court of Canada will not be updating the forecasts for any changes to appropriations or forecast financial information made in ensuing estimates. Variances will be explained in the Departmental Performance Report.

4. Summary of significant accounting policies

The future-oriented financial information has been prepared in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

Significant accounting policies are as follows:

(a) Parliamentary appropriations – The Office of the Registrar of the Supreme Court of Canada is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the Office of the Registrar of the Supreme Court of Canada do not parallel financial reporting according to Canadian generally accepted accounting principles since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the future-oriented statement of operations are not necessarily the same as those provided through appropriations from Parliament. Note 5 provides a high-level reconciliation between the bases of reporting.

(b) Forecasted revenues – Sales and other revenues are accounted for in the period in which the underlying transaction or event is forecasted that gave rise to the revenues.

(c) Forecasted Expenses – These are recorded when the underlying transaction or expense is estimated subject to the following:

1. Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
2. Services provided without charge by other government departments for accommodation, the employer's contribution to the health and dental insurance plans, legal services, worker's compensation, interpretation services and security services are recorded as operating expenses at their estimated cost.

(d) Employee and federally-appointed Supreme Court of Canada Judges future benefits

1. Employee pension benefits: Eligible employees participate in the Public Service Pension Plan, a multi employer plan administered by the Government of Canada. The Office of the Registrar of the Supreme Court of Canada's contributions to the Plan are charged to expenses in the year incurred and represent its total obligation to the Plan. Current legislation does not require the Office of the Registrar of the Supreme Court of Canada to make contributions for any actuarial deficiencies of the Plan.
2. Employee severance benefits: Employees are entitled to severance benefits under labour contracts or conditions of employment. These benefits are accrued as employees render the services necessary to earn them. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.
3. Federally appointed Supreme Court of Canada judges pension benefits: Eligible federally appointed judges and their survivors are entitled to fully indexed annuities providing that the judges meet minimum age and service requirements. The main benefits paid from this plan are recorded on a pay-as-you-go basis. They are included in the Statement of Operations as a component of salaries and benefits and the judges' contributions are credited to revenue.

(e) Tangible capital assets – All tangible capital assets and leasehold improvements having an initial cost of $5,000 or more are recorded at their acquisition cost. The Office of the Registrar of the Supreme Court of Canada has many works of art and historically significant assets such as rare books, paintings, busts, clocks and other works of art. In accordance with Treasury Board of Canada Secretariat policy, these values are not capitalized as they are considered non-operational heritage assets. Intangible assets are not capitalized.

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

Asset Class	Amortization Period
Machinery and equipment	3 - 10 years
Office furniture and equipment	5 - 10 years
Computer equipment	3 - 10 years
Computer software	3 - 10 years
Motor vehicles	3 years
Leasehold improvements	5 years
Assets under construction	Once in service, in accordance with asset type

(f) Measurement uncertainty – The preparation of the future-oriented financial information requires management to make estimates and assumptions that affect the reported amounts of all the assets, liabilities, revenues and expenses reported in the future-oriented financial statements. Assumptions are based upon information available and known to management at the time of development, reflect current business and economic conditions, and assume a continuation of current governmental priorities and consistency in departmental mandate and strategic objectives. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. Nonetheless, as with all such estimates and assumptions, there is a measure of uncertainty surrounding them. This uncertainty increases as the forecast horizon extends.

5. Parliamentary Appropriations

The Office of the Registrar of the Supreme Court of Canada receives all of its funding through annual Parliamentary appropriations. Items recognized in the Statement of Operations and the Statement of Financial Position in one year may be funded through Parliamentary appropriations in prior, current or future years. Accordingly, the Office of the Registrar of the Supreme Court of Canada 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 table:

(a) Reconciliation of net cost of operations to current year appropriations used:

(in dollars)

	2011	2010
Net cost of operations	42,085,962	41,049,695
Adjustments for items affecting net cost of operations but not affecting appropriations
Add (Less):
Services provided without charge from other government departments	(9,876,497)	(9,453,706)
Amortization of tangible capital assets	(1,936,772)	(2,055,131)
Revenue not available for spending	192,000	195,000
Decrease (increase) - Vacation and compensatory leave	(54,852)	(57,322)
Decrease (increase) - Employee severance benefits	(72,718)	(29,589)
Adjustments for items not affecting net cost of operations but affecting appropriations:
Add (Less):
Acquisition of tangible capital assets	658,939	718,009
Appropriations available for use	30,996,062	30,366,956

(b) Appropriations available for use:

(in dollars)

	2011	2010
Vote 50 - Operating expenditures	21,631,955	22,798,960
Contributions to employee benefits plan	2,281,275	2,179,996
Judges salaries, allowances and annuities	5,488,000	5,388,000
Appropriations available per ARLU	29,401,230	30,366,956
Add:
Additional authorities anticipated:	1,594,832	0
Total appropriations for use	30,996,062	30,366,956

6. Employee Benefits

(a) Pension benefits: The Office of the Registrar of the Supreme Court of Canada's 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 the Canada/Québec Pension Plans benefits and they are indexed to inflation.

Both the employees and the Office of the Registrar of the Supreme Court of Canada contribute to the cost of the Plan. The 2010-11 projected expense amounts to $1,763,224 (projected at $1,728,651 in 2009-10).

The Office'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.

(b) Severance benefits: The Office of the Registrar of the Supreme Court of Canada provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information about the severance benefits, measured as at March 31, is as follows:

(in dollars)

	Forecast 2011	Forecast 2010
Accrued benefit obligation, beginning of year	3,001,425	2,971,836
Expense for the year	377,760	160,322
Benefits paid during the year	(305,042)	(130,733)
Accrued benefit obligation, end of year	3,074,143	3,001,425

7. Related Party Transactions

The Office of the Registrar of the Supreme Court of Canada is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. The Office of the Registrar of the Supreme Court of Canada enters into transactions with these entities in the normal course of business and on normal trade terms.

(a) Services provided without charge

During the year the Office of the Registrar of the Supreme Court of Canada received services without charge from other government departments. These services have been recognized in the Office's Statement of Operations as follows:

(in dollars)

	Forecast 2011	Forecast 2010
Interpretation services provided by PWGSC	123,464	122,242
Worker's compensation provided by HRSDC	39,964	39,442
Accommodation provided by PWGSC	5,071,140	4,708,934
Security services provided by the RCMP	3,306,602	3,273,863
Employer's contributions to health and dental insurance plans	1,331,174	1,305,072
Legal services provided by Justice Canada	4,153	4,153
	9,876,497	9,453,706