Financial statements, March 31, 2019

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, 2019, and all information contained in these statements rests with the management of Statistics Canada (the agency). These financial statements have been prepared by management using the Government of Canada'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 judgment, and gives due consideration to materiality. To fulfill its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the agency's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in the agency's Departmental Results 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 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 agency 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 the effectiveness of associated key controls, and to make any necessary adjustments.

A risk-based assessment of the system of ICFR for the year ended March 31, 2019 was completed in accordance with the Treasury Board Policy on Financial Management and the results and action plans are summarized in the annex, which can be found at the end of the notes to these financial statements.

The effectiveness and adequacy of the agency's system of internal control is reviewed by the work of internal finance staff, who conduct periodic assessments of different areas of the agency's operations, and by the Departmental Audit Committee (DAC), who provide advice to the Chief Statistician on the adequacy and effectiveness of the agency's risk management, control and governance frameworks and processes.

The financial statements of Statistics Canada have not been audited.

Statement of Financial Position (Unaudited)
As at March 31
(in thousands of dollars)

	2019	2018
Liabilities
Accounts payable and accrued liabilities (note 4)	79,357	84,754
Vacation pay and compensatory leave	27,577	25,611
Deferred revenue (note 5)	619	627
Lease obligation for tangible capital assets (note 6)	6	30
Employee future benefits (note 7)	19,280	22,852
Total net liabilities	126,839	133,874
Financial assets
Due from Consolidated Revenue Fund	63,107	62,149
Accounts receivable and advances (note 8)	7,316	8,659
Total net financial assets	70,423	70,808
Departmental net debt	56,416	63,066
Non-financial assets
Prepaid expenses	4,174	5,355
Consumable supplies	1,098	1,280
Tangible capital assets (note 9)	164,985	156,338
Total non-financial assets	170,257	162,973
Departmental net financial position	113,841	99,907
Contractual obligations and contractual rights (note 10) Contingent liabilities and contingent assets (note 11) The accompanying notes form an integral part of these financial statements.

Statement of Operations and Departmental Net Financial Position (Unaudited)
For the Year Ended March 31
(in thousands of dollars)

	2019 Planned Results	2019	2018
Expenses
Economic and environmental statistics	0	0	147,595
Socio-economic statistics	0	0	110,129
Censuses	0	0	76,229
Statistical infrastructure	0	0	171,120
Cost-recovered statistical services	0	0	126,098
Statistical Information	578,921	610,940	0
Internal services	73,688	78,608	80,828
Total expenses	652,609	689,548	711,999
Revenues
Special statistical services	131,017	143,882	129,915
Other revenues	100	80	111
Revenues earned on behalf of Government	-18,604	-20,418	-18,543
Total revenues	112,513	123,544	111,483
Net cost of operations before government funding and transfers	540,096	566,004	600,516
Government funding and transfers
Net cash provided by Government of Canada		504,373	535,731
Change in due from Consolidated Revenue Fund		958	7,842
Services provided without charge by other federal government departments (note 12a)		74,507	81,447
Transfer of the transition payments for implementing salary payments in arrears		0	-3
Transfer of assets to other federal government departments		100	-0
Net revenue of operations after government funding and transfers		-13,934	-24,501
Departmental net financial position - Beginning of year		99,907	75,406
Departmental net financial position - End of year		113,841	99,907
Segmented information (note 13) Comparative information (note 14) The accompanying notes form an integral part of these financial statements.

Statement of Change in Departmental Net Debt (Unaudited)
For the Year Ended March 31
(in thousands of dollars)

	2019	2018
Net revenue of operations after government funding and transfers	-13,934	-24,501
Change due to tangible capital assets
Acquisition of tangible capital assets (note 9)	36,046	33,837
Amortization of tangible capital assets (note 9)	-27,418	-24,998
Net loss on disposal of tangible capital assets	-76	-108
Transfer of tangible capital assets to other federal government departments	95	-0
Total change due to tangible capital assets	8,647	8,731
Change due to consumable supplies	-182	150
Change due to prepaid expenses	-1,181	-281
Net decrease in departmental net debt	-6,650	-15,901
Departmental net debt - Beginning of year	63,066	78,967
Departmental net debt - End of year	56,416	63,066
The accompanying notes form an integral part of these financial statements.

Statement of Cash Flows (Unaudited)
For the Year Ended March 31
(in thousands of dollars)

	2019	2018
Operating activities
Net cost of operations before government funding and transfers	566,004	600,516
Non-cash items:
Amortization of tangible capital assets (note 9)	-27,418	-24,998
Loss on disposal of tangible capital assets	-76	-108
Services provided without charge by other federal government departments (note 12a)	-74,507	-81,447
Transfer of emergency salary advances to other federal government departments	-5	0
Transition payments for implementing salary payments in arrears	0	3
Variations in Statement of Financial Position:
Decrease in accounts receivable and advances	-1,343	-10,007
Decrease in prepaid expenses	-1,181	-281
Decrease / increase in consumable supplies	-182	150
Decrease in accounts payable and accrued liabilities	5,397	21,194
Increase in vacation pay and compensatory leave	-1,966	-2,353
Decrease in deferred revenue	8	286
Decrease / increase in employee future benefits	3,572	-1,142
Cash used in operating activities	468,303	501,813
Capital investing activities
Acquisitions of tangible capital assets, excluding capital leases (note 9)	36,046	33,837
Cash used in capital investing activities	36,046	33,837
Financing activities
Payments of lease obligation for tangible capital assets	24	81
Cash used in financing activities	24	81
Net cash provided by Government of Canada	504,373	535,731
The accompanying notes form an integral part of these financial statements.

Notes to the Financial Statements (Unaudited)
For the Year Ended March 31

1. Authority and objectives

Statistics Canada (the agency) was established in 1918, pursuant to the Statistics Act. The agency received full departmental status by order-in-council in 1965.

The agency is a division of the public service named in Schedule I.1 of the Financial Administration Act. The minister responsible for Statistics Canada is the Minister of Innovation, Science and Economic Development, who represents the agency in Parliament and in Cabinet.

The agency's mandate derives primarily from the Statistics Act. The act requires the agency — under the direction of the minister — to collect, compile, analyze, and publish statistical information on the economic, social, and general conditions of the country and its citizens. Statistics Canada has a mandate to coordinate and manage the country's statistical system.

The agency's mandate has two primary objectives:

• Provide statistical information and analysis of the economic and social structure and functioning of Canadian society as a basis for the development, operation and evaluation of public policies and programs. This information is used for public and private decision-making, and for the general benefit of all Canadians.
• Promote the quality, coherence, and international comparability of Canada's statistics through collaboration with other federal departments and agencies, with the provinces and territories, and in accordance with sound scientific standards and practices.

The agency reports on the two core responsibilities described below.

Statistical information - The agency has a responsibility to produce objective high-quality statistical information for the whole of Canada. The statistical information produced relates to the commercial, industrial, financial, social, economic, environmental and general activities and conditions of the people of Canada.

Internal services - Internal services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization.

2. Summary of significant accounting policies

These financial statements have been prepared using the agency'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.

The significant accounting policies are as follows:

(a) Parliamentary authorities

The agency is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to the agency 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 Financial Position and in the Statement of Operations and Departmental Net 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 Position are the amounts reported in the Future-oriented Statement of Operations included in the 2018-19 Departmental Plan. 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 2018-19 Departmental Plan.

(b) Net cash provided by Government

The agency operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the agency is deposited into the CRF, and all cash disbursements made by the agency are paid from the CRF. The net cash provided by the Government is the difference between all cash receipts and all cash disbursements, including transactions between federal government departments.

(c) Amounts due from or to the CRF

Amounts due from or to the CRF are the result of timing differences at year-end between the time 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 agency is entitled to draw from the CRF without further authorities to discharge its liabilities.

(d) Revenues

• Revenues received for special statistical services are recorded as deferred revenue upon receipt. These amounts are recognized as revenue in the period in which the services are rendered and related expenses are incurred.
• 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. While the Chief Statistician; is expected to maintain accounting control, he has no authority regarding 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 entity's gross revenues.

(e) 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.
• 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 federal government departments for accommodation, employer contributions to the health and dental insurance plans, and workers' compensation are recorded as operating expenses at their carrying value.

(f) Employee future benefits

1. Pension benefits — Eligible employees participate in the Public Service Pension Plan, a multi-employer pension plan administered by the Government. The agency's contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. The agency'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.
2. Severance benefits — The accumulation of severance benefits for voluntary departures ceased for applicable employee groups. The remaining obligation for employees who did not withdraw benefits is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.

(g) Accounts receivable

Accounts receivable are initially recorded at cost. When necessary, an allowance for valuation is recorded to reduce the carrying value of accounts receivable to amounts that approximate their net recoverable value.

(h) Non-financial assets

• All tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. Tangible capital assets do not include immovable assets located on reserves as defined in the Indian Act, works of art, museum collection and Crown land to which no acquisition cost is attributable; and intangible assets.
• Consumable supplies include items held for future program delivery and are not intended for resale. These supplies are recorded at the acquisition cost. If there is no longer a service potential, the supplies are valued at the lower of cost or net realizable value.

(i) Contingent liabilities

Contingent liabilities are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, a provision is accrued and an expense recorded to other expenses. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.

(j) Contingent assets

Contingent assets are possible assets which may become actual assets when one or more future events occur or fail to occur. If the future even is likely to occur or fail to occur, the contingent asset is disclosed in the notes to the financial statements.

(k) Transactions involving foreign currencies

Transactions involving foreign currencies are translated into Canadian dollar equivalents using rates of exchange in effect at the time of those transactions. Gains and losses resulting from foreign currency transactions are reported on the Statement of Operations and Departmental Net Financial Position according to the activities to which they relate.

(l) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported and disclosed amounts of assets, liabilities, revenues and expenses reported in the financial statements and accompanying notes at March 31. The estimates are based on facts and circumstances, historical experience, general economic conditions and reflect the Government's best estimate of the related amount at the end of the reporting period. The most significant items where estimates are used are 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.

(m) Related party transactions

Inter-entity transactions are transactions between commonly controlled entities. Inter-entity transactions, other than restructuring transactions, are recorded on a gross basis and are measured at the carrying amount, except for the following:

1. Services provided on a recovery basis are recognized as revenues and expenses on a gross basis and measured at the exchange amount.
2. Certain services received on a without charge basis are recorded for departmental financial statement purposes at the carrying amount.

3. Parliamentary authorities

The agency 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 agency 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:

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

Reconciliation of net cost of operations to current year authorities used

	2019	2018
	(in thousands of dollars)
Net cost of operations before government funding and transfers	566,004	600,516
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets	-27,418	-24,998
Loss on disposal of tangible capital assets	-76	-108
Services provided without charge by other federal government departments	-74,507	-81,447
Increase in vacation pay and compensatory leave	-1,966	-2,353
Decrease / increase in employee future benefits	3,572	-1,142
Refund of prior years' expenditures	1,548	754
Consumption of prepaid expenses	-9,261	-8,122
Bad debt expense	-80	-3
Consumption of supplies	-182	0
Increase / decrease in accrued salary receivable	183	-55
Total items affecting net cost of operations but not affecting authorities	-108,187	-117,474
Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisition of tangible capital assets, excluding capital leases	36,046	33,837
Decrease in lease obligations for tangible capital assets	24	81
Decrease in respendable accounts receivable	-664	-193
Acquisition of prepaid expenses	8,081	7,842
Acquisition of consumable supplies	0	150
Increase in salary receivable	353	847
Increase / decrease in salary advances	6	-4
Transition payments for implementing salary payments in arrears	0	3
Payments for pay equity settlement	6,081	20,166
Total items not affecting net cost of operations but affecting authorities	49,927	62,729
Current year authorities used	507,744	545,771

(b) Authorities provided and used

Authorities provided and used

	2019	2018
	(in thousands of dollars)
Authorities provided:
Vote 1 - Operating expenditures	466,035	504,907
Statutory amounts	69,622	70,220
Total authorities provided	535,657	575,127
Less:
Lapsed: Operating expenditures	-27,913	-29,356
Current year authorities used	507,744	545,771

4. Accounts payable and accrued liabilities

The following table presents details of the agency's accounts payable and accrued liabilities:

Accounts payable and accrued liabilities

	2019	2018
	(in thousands of dollars)
Accounts payable - Other federal government departments and agencies	9,323	11,759
Accounts payable - External parties	24,631	39,713
Accrued salaries and wages	45,403	33,282
Total accounts payables and accrued liabilities	79,357	84,754

5. Deferred revenue

The agency has the authority to expend revenue received during the fiscal year. Deferred revenue represents the balance at year-end of unearned revenues stemming from amounts received from external parties, which are restricted for specific statistical services. Revenue is recognized in the period in which these expenditures are incurred or in which the service is performed. Details of the transactions related to this account are as follows:

Deferred revenue

	2019	2018
	(in thousands of dollars)
Opening balance	627	913
Amount received	143,874	129,629
Revenues recognized	-143,882	-129,915
Net closing balance	619	627

6. Lease obligation for tangible capital assets

The agency has entered into agreements to lease photocopiers under capital leases with a cost of $110 thousand and accumulated amortization of $104 thousand as at March 31, 2019 ($110 thousand and $81 thousand respectively as at March 31, 2018). Obligations for the coming years include the following:

Lease obligation for tangible capital assets

	2019
	(in thousands of dollars)
2020	6
2021	0
2022 and subsequent	0
Total future minimum lease payments	6
Less: imputed interest (0.61% to 1.51%)	-0
Balance of obligations under leased tangible capital assets	6

7. Employee future benefits

a) Pension benefits

The agency's employees participate in the Public Service Pension Plan ("the 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 Canada/Québec Pension Plan benefits and they are indexed to inflation.

Both the employees and the agency contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to Economic Action Plan 2012, employee contributors have been divided into two groups – Group 1 relates to existing plan members as of December 31, 2012, and Group 2 relates to members who joined the Plan as of January 1, 2013. Each group has a distinct contribution rate.

The 2018-2019 expense amounts to $48,546 thousand ($47,801 thousand in 2017-2018). For Group 1 members, the expense represents approximately 1.01 times (1.01 times in 2017-2018) the employee contributions and, for Group 2 members, approximately 1.00 times (1.00 times in 2017-2018) the employee contributions.

The agency's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the Consolidated Financial Statements of the Government of Canada, as the Plan's sponsor.

b) Severance benefits

Severance benefits provided to the agency's employees were previously based on an employee's eligibility, years of service and salary at termination of employment. However, since 2011 the accumulation of severance benefits for voluntary departures progressively ceased for substantially all employees. Employees subject to these changes were given the option to be paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits upon departure from the public service. By March 31, 2019, substantially all settlements for immediate cash out were completed. Severance benefits are unfunded and, consequently, the outstanding obligation will be paid from future authorities.

The changes in the obligations during the year were as follows:

Severance benefits

	2019	2018
	(in thousands of dollars)
Accrued benefit obligation - Beginning of year	22,852	21,710
Expense or adjustment for the year	-1,308	4,077
Benefits paid during the year	-2,264	-2,935
Accrued benefit obligation - End of year	19,280	22,852

8. Accounts receivable and advances

The following table presents details of the agency's accounts receivable and advances balances:

Accounts receivable and advances

	2019	2018
	(in thousands of dollars)
Receivables - Other federal government departments and agencies	1,153	2,307
Receivables - External parties	5,987	6,409
Employees advances	178	165
Subtotal	7,318	8,881
Allowance for doubtful accounts on receivables from external parties	-2	-222
Net accounts receivable and advances	7,316	8,659

9. Tangible capital assets

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

Amortization period of tangible capital assets

Asset class	Amortization period
Computer hardware	5 years
Computer software	5 years
Other equipment	5 years
Motor vehicles	7 years
Leasehold improvements	25 years
Assets under construction	Once in service
Software under development	Once in service
Assets under capital leases	Term of lease

Assets under construction and software assets under development are recorded in the applicable asset class in the year that they are put into service and are not amortized until they are put into service.

Tangible capital assets

Capital Asset Class	Cost					Accumulated Amortization					Net Book Value
	Opening Balance	Acquisitions	Disposals and Write-Offs	AdjustmentsFootnote 1	Closing Balance	Opening Balance	Amortization	Disposals and Write-Offs	AdjustmentsFootnote 1	Closing Balance	2019	2018
	(in thousands of dollars)
Computer hardware	3,127	179	-48	-172	3,086	2,999	49	-48	-172	2,828	258	128
Computer software	285,878	526	-5,483	48,774	329,695	209,501	25,628	-5,407	0	229,722	99,973	76,377
Other equipment	4,067	399	-87	132	4,511	2,329	522	-87	37	2,801	1,710	1,738
Motor vehicles	2,697	115	0	0	2,812	1,884	301	0	0	2,185	627	813
Leasehold improvements	22,355	779	0	744	23,878	7,539	895	0	0	8,434	15,444	14,816
Assets under construction	744	54	0	-744	54	0	0	0	0	0	54	744
Software under development	61,693	33,994	0	-48,774	46,913	0	0	0	0	0	46,913	61,693
Assets under capital leases	110	0	0	0	110	81	23	0	0	104	6	29
Total	380,671	36,046	-5,618	-40	411,059	224,333	27,418	-5,542	-135	246,074	164,985	156,338
Footnote 1 Included in adjustments are the following: software assets under development of $48,774 thousand that were transferred to computer software upon completion of the assets; assets under construction of $744 thousand that were transferred to leasehold improvements upon completion of construction; computer hardware with a net book value of $1 which was transferred to Public Services and Procurement Canada; equipment with a net book value of $95 thousand which was transferred to the agency from Canada Revenue Agency. Return to the first footnote 1 referrer

10. Contractual obligations and contractual rights

a) Contractual obligations

The nature of the agency's activities may result in some large multi-year contracts and obligations whereby the agency will be obligated to make future payments when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:

Contractual obligations

	2020	2021	2022	2023	2024 and subsequent	Total
	(in thousands of dollars)
Acquisition of goods and services	4,610	10,582	2,573	0	0	17,765
Total	4,610	10,582	2,573	0	0	17,765

b) Contractual rights

The activities of the agency sometimes involve the negotiation of contracts or agreements with outside parties that result in the agency having rights to both assets and revenues in the future. They involve sales of goods and services. Major contractual rights that will generate revenues in future years and that can be reasonably estimated are summarized as follows:

Contractual rights

	2020	2021	2022	2023	2024 and subsequent	Total
	(in thousands of dollars)
Sales of goods and services	2,981	479	0	0	0	3,460
Total	2,981	479	0	0	0	3,460

11. Contingent liabilities and contingent assets

a) Contingent liabilities

Contingent liabilities arise in the normal course of operations and their ultimate disposition is unknown.

Claims and litigations

The agency records an allowance for claims and litigations where it is likely that there will be a future payment and a reasonable estimate of the loss can be made. In 2018-2019, the agency did not have any contingent liabilities.

b) Contingent assets

The agency discloses contingent assets that are likely to be realized. In 2018-2019, the agency did not have any contingent assets.

12. Related party transactions

The agency is related as a result of common ownership to all government departments, agencies, and Crown corporations. Related parties also include individuals who are members of key management personnel or close family members of those individuals, and entities controlled by, or under shared control of, a member of key management personnel or a close family member of that individual.

The agency enters into transactions with these entities in the normal course of business and on normal trade terms.

a) Common services provided without charge by other federal government departments

During the year, the agency received services without charge from certain common service organizations related to accommodation, the employer's contribution to the health and dental insurance plans and workers' compensation coverage. These services provided without charge have been recorded at the carrying value in the agency's Statement of Operations and Departmental Net Financial Position as follows:

Common services provided without charge by other federal government departments

	2019	2018
	(in thousands of dollars)
Accommodation	35,973	36,605
Employer's contribution to the health and dental insurance plans	38,458	44,754
Worker's compensation	76	88
Total	74,507	81,447

The Government has centralized some of its administrative activities for efficiency, cost-effectiveness purposes and economic delivery of programs to the public. As a result, the Government uses central agencies and common service organizations so that one department performs services for all other departments and agencies without charge. The costs of these services, such as the payroll and cheque issuance services provided by Public Services and Procurement Canada and audit services provided by the Office of the Auditor General are not included in the agency's Statement of Operations and Departmental Net Financial Position.

b) Other transactions with other federal government departments and agencies

Other transactions with other federal government departments and agencies

	2019	2018
	(in thousands of dollars)
Accounts receivable	1,153	2,307
Accounts payable	9,323	11,759
Expenses	16,189	17,935
Revenues	102,004	94,770

Expenses and revenues disclosed in (b) exclude common services provided without charge, which are already disclosed in (a).

13. Segmented information

Presentation by segment is based on the agency's core responsibilities. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in note 2. The following table presents the expenses incurred and revenues generated for the main core responsibilities, by major object of expense and by major type of revenue. The segment results for the period are as follows:

Segmented information

	Statistical Information	Internal services	2019 Total	2018 Total
	(in thousands of dollars)
Transfer payments
Grant to the Organisation for Economic Co-operation and Development	100	0	100	100
Total transfer payments	100	0	100	100
Operating expenses
Salaries and employee benefits	497,722	56,744	554,466	578,016
Accommodation	28,776	7,197	35,973	36,605
Professional and special services	24,342	9,574	33,916	34,205
Transportation and postage	16,927	1,867	18,794	15,307
Amortization	26,721	697	27,418	24,998
Repairs and maintenance	317	182	499	342
Materials and supplies	3,105	1,387	4,492	10,364
Rentals	11,763	942	12,705	11,280
Communication and printing	994	19	1,013	571
Loss on write-offs of assets	76	0	76	108
Bad debts	80	0	80	3
Other	17	-1	16	100
Total operating expenses	610,840	78,608	689,448	711,899
Total expenses	610,940	78,608	689,548	711,999
Revenues
Special statistical services	143,882	0	143,882	129,915
Other revenues	80	0	80	111
Revenues earned on behalf of Government	-20,418	0	-20,418	-18,543
Total revenues	123,544	0	123,544	111,483
Net cost from continuing operations	487,396	78,608	566,004	600,516

14. Comparative information

With the introduction of the new Treasury Board Secretariat Policy on Results, the reporting structure has changed from the previous Program Alignment Architecture to the new Departmental Results Framework. As a result, expenses for 2017-18 and 2018-19 could not be prepared on the same basis. The 2017-18 expenses are presented by Program in accordance with the previous Program Alignment Architecture, whereas expenses for 2018-19 are presented by core responsibility in accordance with the new Departmental Results Framework.

Annex to the Statement of Management Responsibility Including Internal Control over Financial Reporting of Statistics Canada for Fiscal Year 2018-2019 (Unaudited)

1. Introduction

This document provides summary information on the measures taken by Statistics Canada to maintain an effective system of internal control over financial reporting (ICFR), including information on internal control management, assessment results and related action plans.

Detailed information on the agency's authority, mandate and core responsibilities can be found in the Departmental Plan for the 2019-2020 fiscal year and the Departmental Results Report for the 2018-2019 fiscal year.

2. Departmental system of internal control over financial reporting

2.1 Internal control management

Statistics Canada has a well-established governance and accountability structure to support departmental assessment efforts and oversight of its system of internal control.

A departmental internal control management framework, approved by the Chief Statistician and the Chief Financial Officer (CFO), is in place and includes:

• organizational accountability structures as they relate to internal control management to support sound financial management, including roles and responsibilities of senior managers in their areas of responsibility for control management;
• values and ethics considerations;
• ongoing communication and training on statutory requirements, and policies and procedures for sound financial management and control; and
• regular updates to and monitoring, on at least a semi-annual basis, of internal control management as well as the provision of related assessment results and action plans to the Chief Statistician, senior departmental management and the Departmental Audit Committee (DAC).

The DAC provides advice to the Chief Statistician on the adequacy and effectiveness of the agency's risk management, control and governance frameworks and processes.

2.2 Service arrangements relevant to financial statements

Statistics Canada relies on other organizations for the processing of certain transactions that are recorded in its financial statements, as follows:

2.2.1 Common arrangements

• Public Services and Procurement Canada (PSPC), which administers the payment of salaries and the procurement of goods and services, and provides accommodation services;
• Shared Services Canada (SSC), which provides information technology (IT) infrastructure services to the agency;
• The Department of Justice Canada, which provides legal services;
• Treasury Board of Canada Secretariat, which provides information on public service insurance and centrally administers payment of the employer's share of contribution toward statutory employee benefit plans.

2.2.2 Specific arrangements

• Public Services and Procurement Canada provides Statistics Canada with the Common Departmental Financial System (CDFS) platform to capture and report financial transactions.

Readers of this annex may refer to the annexes of the above-noted departments for a greater understanding of the systems of internal control over financial reporting related to these specific services.

3. Departmental assessment results during fiscal year 2018-2019

The following table summarizes the status of the ongoing monitoring activities according to the previous fiscal year's rotational plan.

Progress during the 2018-2019 fiscal year

Previous fiscal year's rotational ongoing monitoring plan for current fiscal year	Status
IT general controls under agency management controls, operating expenditures, financial close and reporting, and payroll and benefits	Completed as planned; no remedial actions required
Budgeting and planning, and direct and precise monitoring controls	Completed as planned; remedial actions started

In the 2018-2019 fiscal year, Statistics Canada conducted a fraud risk assessment in addition to the progress made in ongoing monitoring.

The key findings and adjustments required from the current fiscal year's assessment activities are summarized in subsection 3.1.

3.1 New or significantly amended key controls

In the current year, there were no new or significantly amended key controls in existing processes which required a reassessment.

3.2 Ongoing monitoring program

As part of its ongoing rotational monitoring plan, the agency completed its reassessment of direct and precise monitoring controls, IT general controls (ITGCs), and the financial controls within the business processes of budget and planning, financial close and reporting, operating expenditures, and payroll and benefits. For the most part, the key controls that were tested performed as intended.

4. Departmental action plan for the next fiscal year and subsequent fiscal years

Statistics Canada's ongoing rotational monitoring plan over the next three fiscal years, based on an annual validation of the high-risk processes and controls and related adjustments to the ongoing monitoring plan as required, is shown in the following table.

Ongoing rotational monitoring plan^{Footnote *}

Key control areas	2019-2020 fiscal year	2020-2021 fiscal year	2021-2022 fiscal year
Entity-level controls		X
Direct and precise monitoring	X	X	X
IT general controls under agency management	X	X	X
Budgeting and Planning		X
Capital assets	X		X
Census payroll	X	X
Financial close and reporting	X	X	X
Interviewers' payroll	X		X
Operating expenditures		X
Revenues	X		X
Payroll and benefits	X	X	X
Footnote * The length of the ongoing monitoring plan is at the discretion of the agency and will depend on how often the agency conducts its risk-based assessment. For example, a plan could cover a one-, three- or five-year cycle. A three-year cycle is presented for illustrative purposes. Statistics Canada is in the last year of its ongoing rotational monitoring plan, and as such is conducting its risk-based assessment in the summer of 2019-2020. Therefore, the ongoing rotational monitoring plan above may be adjusted based on the results of this risk assessment. Return to footnote * referrer

In addition to the ongoing monitoring rotational plan, the agency plans to conduct additional design and operating effectiveness testing in 2019-2020 over anti-fraud controls identified in the fraud risk assessment. Further, the agency plans to conduct risk assessments on the following new financial management business processes in line with the policy on internal controls over financial management:

• Budgeting
• Forecasting
• Costing
• Investment planning
• Cabinet submission including CFO attestation.

Ongoing follow-ups will be performed on the previous years' testing recommendations. In addition, the business process narratives will be updated and design and implementation testing will be performed as required. The services of an external consultant have been retained to provide independent, objective advice and to help complete the ongoing monitoring plan.