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2022 to 2023 Future-Oriented Statement of Operations for the Canadian Food Inspection Agency (unaudited)

for the year ending March 31
(in thousands of dollars)
Forecast
results
2021 to 2022
Planned
results
2022 to 2023
Expenses

Safe food and healthy plants and animals

753,291 787,305

Internal services

189,737 201,772
Total expenses 943,028 989,077
Revenues

Inspection fees

37,965 38,389

Registrations, permits, certificates

8,579 8,396

Miscellaneous fees and services

4,854 4,784

Establishment license fees

1,381 1,218

Administrative monetary penalties

455 424

Grading

88 86

Interest

20 26

Revenues earned on behalf of government

(342) (323)
Total revenues 53,000 53,000
Net cost of operations before government funding and transfers 890,028 936,077

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

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Siddika Mithani, Ph.D.
President

Ottawa, Canada
Date: February 2, 2022

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Jacques Cormier, CPA, CGA
Vice-President, Corporate Management
Branch and Chief Financial Officer

Date: February 2, 2022

Notes to the Future-Oriented Statement of Operations (unaudited)

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 2021 to 2022 is based on actual results as at December 31, 2021 and on forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for the fiscal year 2022 to 2023.

The main assumptions underlying the forecasts are as follows:

These assumptions are made as at December 31, 2021.

2. Variations and changes to the forecast financial information

Although every attempt has been made to forecast final results for the remainder of 2021 to 2022 and for 2022 to 2023, 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 2021 to 2022, 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 1 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
2021 to 2022
Planned
results
2022 to 2023
Net cost of operations before government funding and transfers 890,028 936,077
Adjustment for items affecting net cost of operations but not affecting authorities:

Amortization of tangible capital assets

(42,618) (41,748)

Gain (loss) on disposal of tangible capital assets

(214) (228)

Services provided without charge by other government departments

(74,841) (75,796)

Increase (decrease) in prepaid expenses

58 0

Increase (decrease) in inventory

(11) 11

Decrease (increase) in vacation pay and compensatory leave

2,883 (305)

Spending of revenues pursuant to Section 30 of the Canadian Food Inspection Agency ActTable note 1

53,000 53,000

Decrease (increase) in employee future benefits

(350) (356)

Decrease (increase) in allowance for Expired Collective Agreements

(2,782) (12,204)

Decrease (increase) in allowance for bad debt expense

47 (84)

Post-capitalization of tangible capital assets

0 0

Total items affecting net cost of operations but not affecting authorities

(64,828) (77,710)
Adjustment for items not affecting net cost of operations but affecting authorities:

Acquisition of tangible capital assets

21,666 55,599

Proceeds from disposal of tangible capital assets

(329) (304)

Total items not affecting net cost of operations but affecting authorities

21,337 55,295
Requested authorities forecasted to be used 846,537 913,662
(b) Authorities requested (in thousands of dollars)
Forecast
results
2021 to 2022
Planned
results
2022 to 2023
Authorities requested
Vote 1: operating expenditures 676,749 672,690
Vote 5: capital expenditures 33,840 55,599
Statutory contributions to employee benefits plans 90,403 84,278
Statutory compensation payments 12,500 12,500
Statutory authority for spending of revenues pursuant to section 30 of the Canadian Food Inspection Agency ActTable note 1 100,814 88,595
Total authorities requested 914,306 913,662
Less: estimated unused authorities

Vote 1: operating expenditures

20,000 0

Vote 5: capital expenditures

12,174 0

Statutory authority for spending of revenues pursuant to section 30 of the Canadian Food Inspection Agency ActTable note 1

35,595 0
Requested authorities forecasted to be used 846,537 913,662
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