Canada Revenue Agency - Unaudited supplementary financial information

Canada Revenue Agency - Unaudited supplementary financial information

Financial performance information - Parliamentary appropriations

Introduction

This section of the Canada Revenue Agency (CRA) Annual Report to Parliament 2012-2013 provides the details of the CRA's resource management performance for the purpose of reporting to Parliament on the use of appropriations in 2012-2013. 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 to Parliament, together with details on the management of Parliamentary appropriations on the same basis. In addition to the above reporting requirements, the CRA is also required 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 on page 99 in the Annual Report to Parliament 2012-2013 includes certain items such as services received without charge from other government departments and federal agencies. A reconciliation can be found in note 4 on page 107 in the Annual Report to Parliament 2012-2013.

The CRA has prepared and included future-oriented financial statements in the 2012-2013 Report on Plans and Priorities. As directed by 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 Annual Report to Parliament compares actual results to the initial future-oriented financial statements contained in the 2012-2013 Report on Plans and Priorities.

CRA financial information

Activities of the Canada Revenue Agency

(Footnote 1): Spending authorized by Parliament at the beginning of the fiscal year.

(Footnote 2): Main Estimates authorities plus other amounts anticipated to be authorized during the fiscal year.

(Footnote 3): Total spending authorized by Parliament during the fiscal year.

The Financial Statements - Agency Activities reports $3,943.5 million as total Parliamentary appropriations used (note 4 on page 107 shows the reconciliation to the net cost of operations in the Annual Report to Parliament 2012-2013). The difference from the $4,318.5 million reported in this section is explained by two items reported in the Financial Statements - Administered Activities: the statutory disbursements to provinces under the Softwood Lumber Products Export Charge Act, 2006, $136.9 million; and the Children's Special Allowance payments, $238.0 million.

Overview

For 2012-2013, Parliament approved $4,375.0 million through the Main Estimates, as shown in the CRA's 2012-2013 Report on Plans and Priorities.

The 2012-2013 Main Estimates were adjusted to include:

• $248.3 million for the carryforward from 2011-2012;
• $215.8 million for severance payments, parental benefits and vacation credits;
• $7.6 million for a transfer from Public Works and Government Services Canada - Reduction in accommodation requirements;
• $7.2 million for increased employee benefit plans costs;
• $5.0 million for increased Children's Special Allowance payments; and
• $1.7 million for Court Awards and Crown Assets Disposal.

These increases were offset by the following reductions:

• $143.1 million for decreased disbursements to provinces under the Softwood Lumber Products Export Charge Act, 2006;
• $39.8 million for decreased respendable revenue mainly for the provision of services to the Canada Border Services Agency; and
• $4.3 million for the transfer to Shared Services Canada to adjust the initial transfer amount to Shared Services Canada.

This resulted in total approved authorities of $4,673.4 million for 2012-2013, representing an in-year increase of 6.8% over the Main Estimates.

Of the $4,673.4 million total authority, CRA's actual spending totalled $4,318.5 million resulting in $354.9 million remaining unexpended at year-end. After deducting unused resources related primarily to British Columbia's decision to revert to a provincial sales tax model, proposed Foreign Investment Entities and Non-Resident Trusts, Budget 2012 Spending Review, Government advertising campaigns, accommodation and real property services as well as employee benefit plans associated with the conversion of Non-Personnel to Personnel costs, the remaining $299.8 million is available for use by the CRA in 2013-2014 under its statutory two-year spending authority. This amount represents 6.4% of the total authority.

The CRA's two-year spending authority enables the CRA to be more strategic in its use of public funds by taking a multi-year view of plans and budgets. The financial flexibility in 2012-2013 was somewhat higher than usual due to restraint measures introduced by the CRA in response to the Operating Budget freeze implemented by the Government in Budget 2010 and Budget 2012 Spending Review. This increased carryforward was part of the CRA's strategy to address unfunded operating pressures in 2013-2014, including previously approved salary increases for employees.

Revenues administered by the Canada Revenue Agency

Total revenues administered by the CRA amount to some $346.8 billion in 2012-2013, an increase of 3.6% from the $334.7 billion administered in 2011-2012. Please note that fiscal year 2011-2012 revenue amounts have been restated in compliance with the new standard issued by the Public Sector Accounting Board - Section PS 3510 on tax revenues.

List of supplementary information tables

All electronic supplementary information tables listed below can be found on the CRA website at: www.cra-arc.gc.ca/gncy/prfrmnc_rprts/menu-eng.html.

• Details on transfer payment programs
• Greening government operations
• Internal audits and evaluations
• Sources of Respendable and Non-Respendable Non-Tax Revenue
• Details on project spending
• User fees reporting
• Response to parliamentary committees and external audits

Date modified:

2013-11-06