Financial Statements 2015–2016 (Unaudited)

For the year ended March 31, 2016

Table of Contents

• Statement of Management Responsibility Including Internal Control Over Financial Reporting
• Statement of Financial Position (Unaudited)
• Statement of Operations and Departmental Net Financial Position (Unaudited)
• Statement of Change in Departmental Net Debt (Unaudited)
• Statement of Cash Flows (Unaudited)
• Notes to the Financial Statements (Unaudited)
  • 1. Authority and objectives
  • 2. Summary of significant accounting policies
  • 3. Parliamentary authorities
  • 4. Accounts payable and accrued liabilities
  • 5. Employee future benefits
  • 6. Accounts receivable and advances
  • 7. Tangible capital assets
  • 8. Contractual obligations
  • 9. Related party transactions
  • 10. Transfer of the transition payments for implementing salary payments in arrears
  • 11. Segmented information
  • 12. Comparative Information

Statement of Management Responsibility Including Internal Control Over Financial Reporting

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2016, and all information contained in these statements rests with the management of the Canada School of Public Service (the School). These financial statements have been prepared by management using the Government's accounting policies, which are based on Canadian public sector accounting standards.

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 judgement and gives due consideration to materiality. To fulfil its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the School's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada and included in the School'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, the Canada School of Public Service 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 School 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 School is subject to periodic Core Control Audits performed by the Office of the Comptroller General (OCG) and uses the results of such audits to comply with the Treasury Board Policy on Internal Control.

A Core Control Audit was performed in 2014–2015 by the OCG. The Audit Report and related Management Action Plan are posted on the School's Web site.

The financial statements of the School have not been audited.

Statement of Financial Position (Unaudited)

Contractual obligations (note 8)
The accompanying notes form an integral part of the financial statements.

Statement of Operations and Departmental Net Financial Position (Unaudited)

Segmented information (note 11)
The accompanying notes form an integral part of the financial statements.

Statement of Change in Departmental Net Debt (Unaudited)

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

Statement of Cash Flows (Unaudited)

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

Notes to the Financial Statements (Unaudited)

For the year ended March 31

1. Authority and objectives

On April 1, 2004, amendments to the Canadian Centre for Management Development Act were proclaimed and the organization was renamed the Canada School of Public Service (the School). The amended legislation, now entitled the Canada School of Public Service Act, continues and expands the mandate of the former organization as a departmental corporation. The School reports to the President of the Treasury Board.

The School has a single strategic outcome: "Public servants have the common knowledge and the leadership and management competencies they require to fulfil their responsibilities in serving Canadians." One program supports this strategic outcome: Learning Services.

The School was created to ensure that all employees of the Public Service of Canada have the required competencies and common knowledge to serve Canadians in the most efficient and effective way possible. To achieve this goal, the School continues to offer a strong, consistent curriculum that focuses on the key skills and knowledge required by a dynamic public service that must constantly adapt to the needs of its stakeholders and Canadians.

2. Summary of 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:

1. Parliamentary authorities
   The School is financed primarily by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to the School do 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 a reconciliation between the bases of reporting. The planned results amounts in the "Expenses" and "Revenues" sections of the Statement of Operations and Departmental Net Financial Positions are the amounts reported in the Future-oriented Statement of Operations included in the 2015–16 Report on Plans and Priorities. Planned results are not presented 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 because these amounts were not included in the 2015–16 Report on Plans and Priorities.
2. Net cash provided by Government
   The School operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the School is deposited to the CRF, and all cash disbursements made by the School are paid from the CRF. The net cash provided by Government is the difference between all cash receipts and all cash disbursements, including transactions between departments of the Government.
3. Due from or to the CRF
   Amounts due from or to the CRF are the result of timing differences at year-end between when a transaction affects authorities and when it is processed through the CRF. Amounts due from the CRF represent the net amount of cash that the School is entitled to draw from the CRF without further authorities to discharge its liabilities.
4. Revenues
   Revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.
5. Expenses

   Expenses are recorded on the accrual basis:

   • Vacation pay and compensatory leave are accrued as the benefits are earned by employees under their respective terms of employment.
   • Services provided without charge by other government departments for accommodation and employer contributions to the health and dental insurance plans are recorded as operating expenses at their estimated cost.
6. Employee future benefits
   
   • Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multiemployer pension plan administered by the Government of Canada. The School's contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. The School'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 entitled to severance benefits under labour contracts or conditions of employment earn these benefits as services necessary to earn them are rendered. 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.
7. Accounts receivable and advances
   Accounts receivable and advances are stated at the lower of cost or net recoverable value. A valuation allowance is recorded for receivables where recovery is considered uncertain.
8. 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 School does not capitalize intangibles, works of art and historical treasures that have cultural, aesthetic or historical value, assets located on Indian Reserves and museum collections.

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

   Note 2 - Summary of significant accounting policies. (h) Tangible capital assets. Amortization periods for tangible capital assets based on a straight-line basis over the estimated useful life of the assets. Read down the first column for the asset class and down the second for the amortization period.

   Asset class	Amortization period
   Machinery and Equipment	5-10 years
   Other Equipment (including furniture)	5-12 years
   Informatics Hardware	3-5 years
   Software (including developed software)	3-5 years
   Motor Vehicles	4 years
   Leasehold Improvements	2-10 years

   Assets under construction are recorded in the applicable capital asset class in the year that they become available for use and are not amortized until they become available for use.

9. 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, the liability for 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 School 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 School 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
   
   

   Note 3 - Parliamentary authorities. (a) Reconciliation of net cost of operations to current year authorities used. Read down the first column for the net cost of operations before government funding, transfers and adjustments, adjustments for items affecting the net cost of operations but not affecting authorities, and adjustments for items not affecting the net cost of operations but affecting authorities. Read across to the right for the amounts, in thousands of dollars, for 2016 and 2015. Current year authorities used is presented in the last row of the table.

   (in thousands of dollars)	2016	2015
   Net cost of operations before government funding and transfers	92,043	69,536
   Adjustments for items affecting net cost of operations but not affecting authorities
   Revenues	11,723	31,482
   Services provided without charge by other government departments	(14,434)	(13,784)
   Decrease (increase) in employee future benefits	232	(1,527)
   Amortization of tangible capital assets	(914)	(2,036)
   Gain (loss) on disposal of tangible capital assets	(7)	(12)
   Prior year adjustments	228	143
   Decrease (increase) in vacation pay and compensatory leave	132	(49)
   Other	902	216
   Total adjustments for items affecting net cost of operations but not affecting authorities	(2,138)	14,433
   Adjustments for items not affecting net cost of operations but affecting authorities
   Acquisition of tangible capital assets (note 7)	2,843	2,486
   Transition payments for implementing salary payments in arrears (note 10)	19	1,756
   Increase (decrease) in prepaid expenses	(615)	298
   Total adjustments for items not affecting net cost of operations but affecting authorities	2,247	4,540
   Current year authorities used	92,152	88,509

2. Authorities provided and used

   Note 3 - Parliamentary authorities. (b) Authorities provided and used. Read down the first column for the authorities provided and lapsed and statutory authorities. Read across to the right for the amounts, in thousands of dollars, for 2016 and 2015. Current year authorities used is presented in the last row of the table.

   (in thousands of dollars)	2016	2015
   Authorities provided
   Vote 1 – Program expenditures	55,790	42,349
   Less
   Lapsed authorities	(4,967)	(4,416)
   Total authorities used	50,823	37,933
   Statutory authorities
   Spending of revenues pursuant to subsection 18(2) of the Canada School of Public Service Act	32,849	42,278
   Contributions to employee benefits plan	8,480	8,280
   Spending of proceeds from the disposal of surplus Crown assets	-	18
   Total statutory authorities used	41,329	50,576
   Current year authorities used	92,152	88,509

4. Accounts payable and accrued liabilities

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