Future-Oriented Statement of Operations of the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)

Unaudited

For the Year Ending March 31

Future-Oriented Statement of Operations For the Year 2021–22 (PDF version, 61 KB)


Future-Oriented Statement of Operations For the Year 2020–21
  Forecast Results
2020–21
(In thousands of dollars)
Planned Results
2021–22
(In thousands of dollars)
Expenses
Compliance Program 23,197 30,004
Financial Intelligence Program 15,979 22,461
Internal services 26,363 37,780
Total expenses 65,539 90,245
Revenues
Compliance Program 147 0
Revenues earned on behalf of Government (147) 0
Total revenues 0 0
Net Cost of OperationsFootnote 1 65,539 90,245

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

1. Methodology and Significant Assumptions

The Future-Oriented Statement of Operations has been prepared based on government priorities and the plans of FINTRAC as described in the Departmental Plan.

The information in the forecast results for fiscal year 2020–21 is based on actual results as at December 8, 2020 and on forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for fiscal year 2021–22.

The main assumptions underlying the forecasts are as follows:

  1. The activities of FINTRAC will remain substantially the same as in the previous year.
  2. Expenses and revenues, including the determination of amounts internal and external to the government, are based on experience. The general historical pattern is expected to continue.
  3. Forecast results of 2020–21 year end information are used as the opening position for the 2021–22 planned results.

These assumptions are made as at December 8, 2020.

2. Variations and Changes to the Forecast Financial Information

Although every attempt has been made to forecast final results for the remainder of 2020–21 and for 2021–22, 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, FINTRAC 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 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, FINTRAC 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 202021, 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

Expenses are recorded on an accrual basis. Expenses for FINTRAC's operations are recorded when goods are received or services are rendered, including services provided without charges for employee contributions to health and dental insurance plans and workers' compensation, which are recorded as expenses at their estimated cost. Vacation pay and compensatory leave, as well as severance benefits, are accrued and expenses are recorded as the benefits are earned by employees under their terms of employment.

Expenses also include provisions to reflect changes in the value of assets, including provisions for bad debt on accounts receivable or liabilities, including contingent liabilities to the extent the future event is likely to occur and a reasonable estimate can be made.

Expenses also include amortization of tangible capital assets, which are capitalized at their acquisition cost. Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset.

b) Revenues

Since December 30, 2008, FINTRAC has had the legislative authority to issue administrative monetary penalties (AMPs) to reporting entities that are in non-compliance with Canada's Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA). Accordingly, results commencing in the 2009‒10 fiscal year indicate the AMPs as a source of non-respendable revenue.

Revenues that are non-respendable are not available to discharge FINTRAC'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 in reduction of the entity's gross revenues.

4. Parliamentary Authorities

FINTRAC is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to FINTRAC 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 one year may be funded through parliamentary authorities in prior, current, or future years. Accordingly, FINTRAC 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
  Forecast Results
2020–21
(In thousands of dollars)
Planned Results
2021–22
(In thousands of dollars)
Net cost of operations before government funding and transfers 65,539 90,245
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets (243) (263)
Services provided without charge by other government departments (3,379) (4,252)
Vacation pay and compensatory leave (122) 142
Employee future benefits 87 69
Refund of previous years' expenditures 235 336
Total items affecting net cost of operations but not affecting authorities Footnote 1 (3,422) (3,968)
Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisition of tangible capital assets 247 246
Prepaid expenses (12) 77
Total items not affecting net cost of operations but affecting authorities Footnote 1 235 324
Requested authorities Footnote 1 62,352 86,601
(b) Authorities requested (in thousands of dollars)
  Forecast Results
2020–21
(In thousands of dollars)
Planned Results
2021–22
(In thousands of dollars)
Authorities Requested
Vote 1 – Program expenditures 74,319 79,760
Statutory Amounts 6,561 6,840
Less:
Lapsed Vote 1 – Program expenditures
(18,528) 0
Requested Authorities Footnote 1 62,352 86,601
Date Modified: