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Unaudited supplementary financial information

Financial performance information – parliamentary appropriations

Introduction

This section provides the details of the CRA's resource management performance for the purpose of reporting to Parliament on the use of appropriations in 2014-2015. This complements the information provided in the spending profile sections under each program and satisfies the reporting requirements set for annual reports to Parliament.

Financial reporting methodologies

The CRA's funding is provided by Parliament through annual appropriations (modified cash accounting basis) and, in this section, the CRA reports its expenditures and performance, together with details on the management of Parliamentary appropriations on the same basis. In addition to its reporting requirements, the CRA also has to prepare its annual financial statements in accordance with the accounting principles applied in preparing the financial statements of the Government of Canada (full accrual accounting basis). Accordingly, the audited Statement of Operations and Agency Net Financial Position – Agency Activities includes certain items such as services received without charge from other government departments and federal agencies. A reconciliation can be found in note 3.

The CRA prepared and included future-oriented financial statements in the 2014-15 Report on Plans and Priorities. As directed by the Treasury Board of Canada Secretariat, this future-oriented financial information was prepared on an accrual basis to strengthen accountability and improve transparency and financial management. As part of the analysis of net cost of operations, the report compares actual results to the initial future-oriented financial statements contained in the 2014-15 Report on Plans and Priorities.

The Financial Statements – Agency Activities reports total Parliamentary appropriations used as $3,861.2 million (note 3b shows the reconciliation to the net cost of operations). The difference from the $4,060.8 million noted above is primarily explained by two items reported in the Financial Statements – Administered Activities, namely statutory disbursements to provinces under the Softwood Lumber Products Export Charge Act, 2006, -$15.1 million; and children's special allowance payments, $214.8 million.

Overview

For 2014-2015, Parliament approved $3,861.3 million through the Main Estimates, as shown in the CRA's 2014-15 Report on Plans and Priorities.

The 2014-2015 Main Estimates were increased to include:

• $339.2 million for the carry-forward from 2013-2014;
• $88.1 million for the one-time transition payment for implementing the pay-in-arrears model;
• $75.7 million for severance payments, parental benefits and vacation credits;
• $34.4 million for contributions to employee benefit plans;
• $31.2 million for enhancements to non-audit compliance programs;
• $22 million for the implementation and administration of various tax measures announced in the 2013 and 2014 federal budgets;
• $13.9 million transferred from Public Works and Government Services Canada due to a reduction in CRA's accommodation needs;
• $3.6 million for court awards and Crown assets disposal; and
• $2.5 million for collective bargaining increases.

These increases were offset by the following reductions:

• $95.1 million for disbursements to provinces under the Softwood Lumber Products Export Charge Act, 2006;
• $13.2 million in the spending of revenues received through the conduct of its operations, primarily attributable to reductions in services to the province of Ontario; and
• $31.2 million in payments under the Children's Special Allowance Act for eligible children in the care of agencies and foster parents.

This resulted in total approved authorities of $4,332.4 million for 2014-2015, representing an in-year increase of 12.2% over the Main Estimates.

Of the $4,332.4 million total authority, CRA's actual spending totalled $4,060.8 million resulting in $271.6 million remaining unexpended at year-end. After deducting unused resources related primarily to Government advertising campaigns, accommodation and real property services, Canada School of Public Service and employee benefit plans associated with converting operating costs to personnel costs, the remaining $261.4 million is available for use by the CRA in 2015-2016 under its statutory two-year spending authority.

The CRA's two-year spending authority enables the CRA to be more strategic in using public funds by taking a multi-year view of plans and budgets. The financial flexibility in 2014-2015 was notably reduced from the prior fiscal year as a result of the implementation of initiatives to improve efficiency. The carry-forward from 2014-2015 forms part of the CRA's strategy to address unfunded operating pressures in 2015-2016, including the amounts set aside in anticipation of wage settlements for the period under the operating budget freeze.

Revenues administered by the CRA

Total revenues administered by the CRA amount to $376.3 billion in 2014-2015, an increase of 4.6% from the $359.9 billion administered in 2013-2014.

Supplementary information tables

The supplementary information tables^xiv can be found on the CRA's website at www.cra.gc.ca^xv.

• Departmental sustainable development strategy;
• Details on transfer payment programs;
• Internal audits and evaluations;
• Response to parliamentary committees and external audits;
• Sources of respendable and non-respendable revenue;
• Details on project spending;
• User fees reporting.

Tax expenditures and evaluations

The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance Canada publishes cost estimates and projections for these measures annually in the Tax Expenditures and Evaluations^xvi publication. The tax measures presented in the Tax Expenditures and Evaluations publication are the sole responsibility of the Minister of Finance.

Table Notes

1. Spending authorized by Parliament at the beginning of the fiscal year.

2. Main Estimates authorities plus other amounts authorized as reported in the 2014-15 Report on Plans and Priorities.

3. Total spending authorized by Parliament during the fiscal year.

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