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Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2010, and all information contained in these statements rests with the management of the Canada Border Services Agency. These financial statements have been prepared by management in accordance with Treasury Board accounting policies, which are based on Canadian generally accepted accounting principles for the public sector.
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 Canada Border Services Agency's Departmental Performance Report, is consistent with these financial statements.
Management is also responsible for maintaining an effective system of internal control over financial reporting 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 assessment of the effectiveness of the system of internal control over financial reporting. An assessment for the year ended March 31, 2010 was completed in accordance with the Policy on Internal Control and the results and action plans are summarized in the annex.
The system of internal control over financial reporting is designed to mitigate risks to a reasonable level based on an on-going process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments. The effectiveness and adequacy of the department's system of internal control is reviewed by the work of internal audit staff, who conduct periodic audits of different areas of the department's operations, and by the Departmental Audit Committee, which oversees management's responsibilities for maintaining adequate control systems and the quality of financial reporting, and which recommends the financial statements to the President of the Canada Border Services Agency.
The financial statements of the Canada Border Services Agency have not been audited.
(in thousands of dollars)
2010 | 2009 | ||||||||
---|---|---|---|---|---|---|---|---|---|
Risk Assessment | Enforcement | Facilitated Border | Conventional Border | Trade | Recourse | Internal Services | Total | Total | |
Operating Expenses | |||||||||
Salaries and employee benefits | 104,177 | 163,366 | 34,549 | 560,612 | 71,708 | 8,375 | 371,450 | 1,314,237 | 1,282,812 |
Professional and special services | 15,484 | 41,427 | 1,785 | 13,456 | 262 | 83 | 182,435 | 254,932 | 262,337 |
Rental of land and buildings | 3,812 | 6,046 | 1,391 | 20,713 | 2,680 | 310 | 28,547 | 63,499 | 59,351 |
Transportation and telecommunication | 3,295 | 11,911 | 435 | 6,647 | 946 | 79 | 27,820 | 51,133 | 70,598 |
Amortization | 1,361 | 4,841 | 315 | 5,668 | 27 | 0 | 34,917 | 47,129 | 34,445 |
Repair and maintenance | 197 | 1,596 | 2,093 | 26 | 148 | 0 | 19,942 | 24,002 | 23,966 |
Materials and supplies | 458 | 2,250 | 89 | 3,163 | 292 | 6 | 16,560 | 22,818 | 20,348 |
Consumable machinery and equipment (parts) | 4,108 | 1,178 | 123 | 751 | 89 | 2 | 13,066 | 19,317 | 34,907 |
Other | 81 | 3,983 | 12 | 895 | 40 | 1 | 5,564 | 10,576 | 10,015 |
Bad debts | 0 | 158 | 146 | 657 | 0 | 0 | 14 | 975 | 274 |
Total Expenses | 132,973 | 236,756 | 40,938 | 612,588 | 76,192 | 8,856 | 700,315 | 1,808,618 | 1,799,053 |
Revenues | |||||||||
Sale of goods and services | 0 | 2,021 | 3,882 | 17,437 | 0 | 0 | 68 | 23,408 | 22,979 |
Forfeitures of cash bonds | 0 | 1,181 | 0 | 0 | 0 | 0 | 0 | 1,181 | 1,567 |
Miscellaneous | 0 | 538 | 0 | 0 | 0 | 0 | 25 | 563 | 3,016 |
Seized property | 0 | 445 | 0 | 0 | 0 | 0 | 0 | 445 | 216 |
Gain on sale of assets | 0 | 0 | 0 | 0 | 0 | 0 | 178 | 178 | 252 |
Interest, penalties and fines | 0 | 0 | 0 | 0 | 0 | 0 | 119 | 119 | 172 |
Total Revenues | 0 | 4,185 | 3,882 | 17,437 | 0 | 0 | 390 | 25,894 | 28,202 |
Net Cost of Operations | 132,973 | 232,571 | 37,056 | 595,151 | 76,192 | 8,856 | 699,925 | 1,782,724 | 1,770,851 |
The accompanying notes form an integral part of these financial statements.
(in thousands of dollars)
2010 | 2009 | |
---|---|---|
ASSETS | ||
Financial assets | ||
Cash | 0 | 121 |
Accounts receivable and advances (Note 4) | 12,855 | 11,170 |
Total financial assets | 12,855 | 11,291 |
Non-financial assets | ||
Prepaid expenses | 85 | 141 |
Inventory | 7,386 | 7,110 |
Tangible capital assets (Note 5) | 412,256 | 383,825 |
Total non-financial assets | 419,727 | 391,076 |
Total | 432,582 | 402,367 |
LIABILITIES AND EQUITY OF CANADA | ||
Liabilities | ||
Bank indebtedness | 76 | 0 |
Accounts payable and accrued liabilities (Note 6) | 161,865 | 240,183 |
Deposit accounts (Note 7) | 31,554 | 32,307 |
Employee severance benefits (Note 8) | 222,706 | 207,198 |
Total | 416,201 | 479,688 |
Equity of Canada (Deficit of Canada) | 16,381 | (77,321) |
Total | 432,582 | 402,367 |
Contingent liabilities (Note 9)
The accompanying notes form an integral part of these financial statements.
(in thousands of dollars)
2010 | 2009 | |
---|---|---|
Deficit of Canada, beginning of year | (77,321) | (30,060) |
Net cost of operations | (1,782,724) | (1,770,851) |
Current year appropriations used (Note 3) | 1,641,044 | 1,647,636 |
Revenue not available for spending | (4,749) | (6,207) |
Change in net position in the Consolidated Revenue Fund (Note 3) | 84,689 | (69,863) |
Services provided without charge from other government departments (Note 10) | 155,442 | 152,024 |
Equity of Canada (Deficit of Canada), end of year | 16,381 | (77,321) |
The accompanying notes form an integral part of these financial statements.
(in thousands of dollars)
2010 | 2009 | |
---|---|---|
Operating activities | ||
Net cost of operations | 1,782,724 | 1,770,851 |
Non-cash items: | ||
Services provided without charge by other government departments | (155,442) | (152,024) |
Amortization of tangible capital assets | (47,129) | (34,445) |
Gain on disposal and write-down of tangible capital assets | 2,159 | 2,688 |
Other | (349) | 11 |
Variations in Statement of Financial Position: | ||
Increase (decrease) in accounts receivable and advances | 1,685 | (2,933) |
(Decrease) in prepaid expenses | (56) | (125) |
Increase (decrease) in inventory | 276 | (95) |
(Increase) decrease in accounts payable and accrued liabilities | 78,318 | (69,592) |
Decrease in deposit accounts | 753 | 715 |
(Increase) in employee severance benefits | (15,508) | (24,414) |
Cash used by operating activities | 1,647,431 | 1,490,637 |
Capital investment activities | ||
Acquisitions of tangible capital assets | 73,941 | 81,264 |
Proceeds from disposal of tangible capital assets | (191) | (275) |
Cash used by capital investment activities | 73,750 | 80,989 |
Financing activities | ||
Net cash provided by the Government of Canada | (1,720,984) | (1,571,562) |
Net cash used | 197 | 64 |
Cash, beginning of year | 121 | 185 |
(Bank indebtedness) Cash at end of year | (76) | 121 |
The accompanying notes form an integral part of these financial statements.
The Canada Border Services Agency (Agency Activities) is responsible for providing integrated border services that support national security and public safety priorities and facilitate the free flow of persons and goods. The Canada Border Services Agency Act received royal assent on November 3, 2005. The Agency is a departmental corporation named in Schedule II of the Financial Administration Act and reports to Parliament through the Minister of Public Safety. The Agency is funded through appropriations from the Government of Canada.
The Agency is responsible for the administration and enforcement of the following acts or portions of these acts: the Customs Act, the Customs Tariff, the Excise Act, the Excise Tax Act, the Citizenship Act, the Immigration and Refugee Protection Act, as well as other acts on behalf of other federal departments and provinces.
In delivering efficient and effective border management that contributes to the security and prosperity of Canada, the Agency operates under the following program activities:
The financial statements have been prepared in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.
Significant accounting policies are as follows:
(a) Parliamentary appropriations
The Agency is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the Agency do not parallel financial reporting according to generally accepted accounting principles since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the statement of operations and the statement of financial position are not necessarily the same as those provided through appropriations from Parliament. Note 3 provides a high-level reconciliation between the bases of reporting.
(b) Net Cash Provided by the Government of Canada
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 to the CRF and all cash disbursements made by the Agency are paid from the CRF. The net cash forwarded to the Government of Canada is the difference between all cash receipts and all cash disbursements including transactions between departments of the federal government.
(c) Change in net position in the Consolidated Revenue Fund
The change in net position in the Consolidated Revenue Fund is the difference between the net cash provided by Government and appropriations used in a year, excluding the amount of non respendable revenue recorded by the Agency. It results from timing differences between when a transaction affects appropriations and when it is processed through the CRF.
(d) Non-tax revenues
Non-tax revenues reported in this statement include revenues collected on behalf of the Government of Canada under the Immigration and Refugee Protection Act, the Agriculture and Agri-Food Administrative Monetary Penalties Act and other similar legislation.
Non-tax revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenue.
(e) Expenses
All expenses are recorded on an accrual basis:
(f) Cash
Cash includes amounts received in Agency offices or by Agency agents as at March 31 but not yet deposited to the credit of the CRF of the Government of Canada.
(g) Accounts receivable and advances
Accounts receivable and advances are stated at amounts expected to be ultimately realized; a provision is made for doubtful accounts where recovery is considered uncertain based on the percentages of aging of receivables. The percentages have been increased this year to reflect the increased rate of the aging of receivables.
(h) Inventory
Inventory consists of forms, publications and uniforms and is not intended for resale. Items in the inventory are valued at cost using the weighted average cost method. Items that are considered obsolete are written off. The cost of inventory is charged to operations in the period in which the items are used.
(i) Tangible capital assets
All tangible capital assets having an initial cost of $10,000 or more are recorded at their acquisition cost. Amortization of capital assets, except land, is performed on a straight-line basis over the estimated useful lives of the assets as follows:
Asset class | Amortization period |
---|---|
Buildings | 30 years |
Works and infrastructure | 40 years |
Machinery and equipment | 10 years |
Information technology equipment | 5 years |
In-house-developed software | 7 years |
Purchased software | 3 years |
Vehicles | 5 years to 10 years |
Leasehold improvements | Over the useful life of the improvement or the lease term, whichever is shorter. |
Assets under construction | Once in service, determined in accordance with asset type. |
(j) Employee future benefits
(k) Contingent liabilities
Contingent liabilities are potential liabilities, which may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense recorded. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.
(l) Environmental liabilities
Environmental liabilities reflect the estimated costs related to the management and remediation of contaminated sites. Based on management's best estimates, a liability is accrued and an expense recorded when the contamination occurs or when the Agency becomes aware of the contamination and is obligated or is likely to be obligated to incur remedial costs. If the likelihood of the Agency's obligation to incur these costs is either not determinable or unlikely, or if an amount cannot be reasonably estimated, the costs are disclosed as contingent liabilities in the notes to the financial statements.
(m) Measurement uncertainty
The preparation of these financial statements, in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable.
The most significant items where estimates are used are contingent liabilities, environmental liabilities, the liability for employee severance benefits, the allowances for doubtful accounts 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.
(n) Comparative information – Change in reporting entity - transition
For financial reporting purposes, the activities of the Agency have been divided into two sets of financial statements: Agency Activities and Administered Activities. The financial statements - Agency Activities include those operational revenues and expenses which are managed by the Agency and utilized in running the organization. The financial statements - Administered Activities include those net revenues that are administered for someone other than the Agency, such as the federal government, a province or territory, or another group or organization. The purpose of the distinction between Agency and Administered activities is to facilitate, among other things, the assessment of the administrative efficiency of the Agency in achieving its mandate.
The Agency receives most of its funding through Parliamentary appropriations. Items recognized in the statement of operations and the statement of financial position in one year may be funded through Parliamentary appropriations in prior, current or future years. Accordingly, the Agency has different net results for the year on a government funding basis than on an accrual accounting basis.
These differences are reconciled below:
(a) Reconciliation of net results to current year appropriations used
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Net cost of operations | 1,782,724 | 1,770,851 |
Adjustments for items affecting net results but not affecting appropriations |
||
Add (Less): | ||
Revenue not available for spending | 4,749 | 6,207 |
Services provided without charge | (155,442) | (152,024) |
Bad Debt | (975) | (274) |
Amortization of tangible capital assets | (47,129) | (34,445) |
Employee severance benefits | (15,508) | (24,414) |
Vacation pay and compensatory leave | (4,692) | (3,119) |
Adjustment to prior year's expenditures | 886 | 931 |
Environmental Liabilities | 70 | 407 |
Gain on disposal and write-down of tangible capital assets | 2,159 | 2,688 |
Other | 41 | (216) |
Total | (215,841) | (204,259) |
Adjustments for items not affecting net results but affecting appropriations | ||
Add (Less): | ||
Acquisition of tangible capital assets | 73,941 | 81,264 |
Inventory variation | 276 | (95) |
Prepaid expenses | (56) | (125) |
Total | 74,161 | 81,044 |
Current year appropriations used | 1,641,044 | 1,647,636 |
(b) Appropriations provided and used
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Parliamentary appropriations | ||
Vote 10 – Operating expenditures | 1,538,564 | 1,579,624 |
Vote 15 – Capital expenditures | 116,639 | 115,505 |
Total | 1,655,203 | 1,695,129 |
Statutory amounts | ||
Contributions to employee benefit plans | 182,102 | 161,233 |
Spending proceeds from disposal of surplus crown assets | 340 | 396 |
Refunds of amounts credited to revenues from previous years | 59 | 42 |
Court Awards | 0 | 11 |
Collection agency fees | 0 | 4 |
Total | 182,501 | 161,686 |
Available for use in subsequent years | ||
Vote 10 – Operating expenditures | (91,678) | (146,524) |
Vote 15 – Capital expenditures | (66,275) | (62,505) |
Total | (157,953) | (209,029) |
Appropriations available for future years | (168) | (150) |
Lapsed appropriations: Operating | (38,539) | 0 |
Total | (38,707) | (150) |
Current year appropriations used | 1,641,044 | 1,647,636 |
(c) Reconciliation of net cash provided by (forwarded to) Government to current year appropriations used
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Net cash provided by Government | 1,720,984 | 1,571,562 |
Revenue not available for spending | 4,749 | 6,207 |
Change in net position in the Consolidated Revenue Fund | ||
Variation in accounts receivable and advances | (1,564) | 2,997 |
Variation in accounts payable and accrued liabilities | (78,318) | 69,592 |
Other adjustments | (4,807) | (2,726) |
Total | (84,689) | 69,863 |
Other | 0 | 4 |
Current year appropriations used | 1,641,044 | 1,647,636 |
The following table presents details of the accounts receivable and advances:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Receivables from other Federal Government departments and agencies | 8,028 | 6,180 |
Receivables from external parties | 5,159 | 4,306 |
Employee advances and other receivables | 1,602 | 1,673 |
Total | 14,789 | 12,159 |
Less: allowance for doubtful accounts on external receivables | (1,934) | (989) |
Total | 12,855 | 11,170 |
(in thousands of dollars)
The following table presents details of the tangible capital assets:
Cost | Accumulated amortization | 2010 | 2009 | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Capital asset class | Opening balance |
Acquisi- tions |
Transfers, disposals, write-offs | Closing balance |
Opening balance | Amorti-zation | Transfers, disposals, write-offs |
Closing balance |
Net book value |
Net book value |
Land | 4,467 | 58 | 0 | 4,525 | 0 | 0 | 0 | 0 | 4,525 | 4,467 |
Buildings | 159,128 | 5,234 | (17,984) | 182,346 | 55,854 | 7,886 | 769 | 62,971 | 119,375 | 103,274 |
Leasehold Improvements | 8,153 | 1,376 | (7,782) | 17,311 | 2,321 | 5,297 | 0 | 7,618 | 9,693 | 5,832 |
Works and infrastructure |
1,124 | 28 | 0 | 1,152 | 377 | 22 | 0 | 399 | 753 | 747 |
Machinery and equipment |
69,295 | 14,418 | (472) | 84,185 | 35,550 | 6,845 | (88) | 42,483 | 41,702 | 33,745 |
Information technology equipment, in-house-developed and purchased software |
136,911 | 1,578 | (32,743) | 171,232 | 81,891 | 24,194 | 1,056 | 105,029 | 66,203 | 55,020 |
Vehicles | 28,384 | 1,984 | 1,757 | 28,611 | 20,559 | 2,885 | 1,734 | 21,710 | 6,901 | 7,825 |
Assets under construction |
172,915 | 49,265 | 59,076 | 163,104 | 0 | 0 | 0 | 0 | 163,104 | 172,915 |
Total | 580,377 | 73,941 | 1,852 | 652,466 | 196,552 | 47,129 | 3,471 | 240,210 | 412,256 | 383,825 |
The following table presents details of accounts payable and accrued liabilities:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Payables to external parties | 47,889 | 41,133 |
Payables to other Federal Government departments and agencies | 47,183 | 31,175 |
Accrued salary, vacation pay and compensatory leave | 66,793 | 167,875 |
Total | 161,865 | 240,183 |
The deposit accounts were established to record cash and securities required to guarantee payment of customs duties and excise taxes on imported goods pursuant to the Customs Act and the Excise Tax Act and to guarantee the compliance of transporters and individuals with the provisions of the Immigration and Refugee Protection Act.
The following table presents details on the deposit accounts:
Opening Balance |
Receipts | Payments | Closing Balance |
|
---|---|---|---|---|
(in thousands of dollars) | ||||
Guarantee deposit accounts | 27,765 | 22,801 | (24,026) | 26,540 |
Other deposit accounts | 4,542 | 933 | (461) | 5,014 |
Total deposit accounts | 32,307 | 23,734 | (24,487) | 31,554 |
(a) Pension benefits
The Agency's employees participate in the Public Service Pension 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 two percent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Quebec pension plan benefits and they are indexed to inflation.
Both the employees and the Agency contribute to the cost of the Plan. The 2009-2010 expense amounts to $131,477,000 ($116,410,000 in 2008-2009), which represents approximately 1.9 times (2.0 in 2008-09) the contributions by employees.
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.
(b) Severance benefits
The Agency provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information about the severance benefits, measured as at March 31, is as follows:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Accrued benefit obligation, beginning of year | 207,198 | 182,784 |
Expense for the year | 29,135 | 35,623 |
Benefits paid during the year | (13,627) | (11,209) |
Accrued benefit obligation, end of year | 222,706 | 207,198 |
(a) Contaminated sites
Liabilities are accrued to record the estimated costs related to the management and remediation of contaminated sites where the Agency is obligated or likely to be obligated to incur such costs. The Agency identified one site in 2010 (one site in 2009) where such action is possible and for which a liability of $292,000 ($362,000 in 2009) has been recorded. The Agency's ongoing efforts to assess contaminated sites may result in additional environmental liabilities related to newly identified sites, or changes in the assessments or intended use of existing sites. These liabilities will be accrued in the year in which they become known.
(b) Claims and litigation
Claims have been made against the Agency in the normal course of operations. Legal proceedings for claims totaling approximately $1,650,000,000 ($1,686,000,000 in 2009) were still pending as at March 31, 2010.
Some of these claims and appeals may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability and expense are recorded in the financial statements. As at March 31, 2010, the Agency has recorded an estimated liability of $290,000 ($290,000 in 2009).
The Agency is related in terms of common ownership to all Government of Canada departments, agencies and Crown corporations. The Agency enters into transactions with these entities in the normal course of business and on normal trade terms. Also during the year, the Agency received services, which were obtained without charge from other government departments as presented in part (a).
(a) Services provided without charge
During the year, the Agency received without charge from other departments, accommodation, legal services, workers' compensation coverage and the employer's contribution to the health and dental insurance plans.
These services without charge have been recognized in the Agency's statement of operations as follows:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Accommodation | 60,562 | 58,403 |
Employer's contribution to the health and dental insurance plans | 80,368 | 79,530 |
Workers' compensation coverage | 391 | 346 |
Legal services | 14,121 | 13,745 |
Total | 155,442 | 152,024 |
The Government has structured some of its administrative activities for efficiency and cost-effectiveness such that one department performs these on behalf of all without charge. The costs of these services, which include payroll and cheque issuance services provided by Public Works and Government Services Canada, are not included as an expense in the Agency's statement of operations.
(b) Administration of programs
The Agency has arrangements with the Canada Revenue Agency for the provision of information technology services, which are paid for on a quarterly basis for a total of $127,740,000 in 2010 ($121,874,000 in 2009).
Separate financial statements have been prepared for the Agency's Activities and Agency's Administered Activities commencing in 2010. The purpose of this is to more accurately represent the actual cost of Agency operations from those revenues that are administered on behalf of the Government of Canada.
Comparative figures have been reclassified to conform to the current year's presentation. The 2009 amounts have been restated to exclude Agency Administered Activities. Furthermore, amounts payable to and receivable from Agency Administered Activities were eliminated upon consolidation in fiscal year 2009. These have been subsequently included within the restated 2009 amounts for comparative purposes.
The following table outlines the restated comparison of key amounts:
Administered Activities | Agency Activities | Total (restated) | Total (Previously Reported) | Difference | ||||||
---|---|---|---|---|---|---|---|---|---|---|
2009 | + | 2009 | = | 2009 | - | 2009 | = | 2009 | ||
(in thousands of dollars) | ||||||||||
Statement of Operations | ||||||||||
Total Tax Revenues | 22,622,415 | + | 0 | = | 22,622,415 | - | 22,622,415 | = | 0 | |
Total Non-Tax Revenues | 72,642 | + | 28,202 | = | 100,844 | - | 100,844 | = | 0 | |
Total Expenses | 67,605 | + | 1,799,053 | = | 1,866,658 | - | 1,866,659 | = | -1 | * |
Total Net Revenues (Cost of Operations) | 22,627,452 | + | (1,770,851) | = | 20,856,601 | - | 20,856,600 | = | 1 | * |
* The difference is due to the rounding as a result of adding amounts from two different trial balances, compared to the rounding when using one trial balance. | ||||||||||
Statement of Financial Position | ||||||||||
Total Assets | 2,557,220 | + | 402,367 | = | 2,959,587 | - | 2,957,608 | = | 1,979 | ** |
Total Liabilities | 59,850 | + | 479,688 | = | 539,538 | - | 537,559 | = | 1,979 | ** |
Total Equity of Canada (Deficit of Canada) | 2,497,370 | + | (77,321) | = | 2,420,049 | - | 2,420,049 | = | 0 | |
** The difference is due to the total payables and receivables between CBSA Administered Activities and CBSA Agency Activities eliminated from the Financial Statements in last year's presentation since both trial balances were included. This year, the payables and receivables are on different financial statements and cannot be eliminated. |
(in thousands of dollars)
2010 | 2009 | |||||
---|---|---|---|---|---|---|
Conventional Border | Trade | Enforcement | Internal Services | Total | Total | |
Administered Revenues | ||||||
Tax revenues | ||||||
Excise taxes (Note 3) | 16,266,855 | 0 | 0 | 0 | 16,266,855 | 17,348,016 |
Customs import duties | 3,476,703 | 13,080 | 0 | 0 | 3,489,783 | 4,036,148 |
Excise duties | 1,256,842 | 0 | 0 | 0 | 1,256,842 | 1,238,251 |
Total | 21,000,400 | 13,080 | 0 | 0 | 21,013,480 | 22,622,415 |
Non-tax revenues | ||||||
Interest, penalties and fines | 22,860 | 0 | 1,410 | 0 | 24,270 | 23,763 |
Seized property | 10 | 0 | 11,049 | 0 | 11,059 | 46,241 |
Sale of goods and services | 685 | 0 | 304 | 0 | 989 | 1,924 |
Miscellaneous | 714 | 0 | 0 | 8 | 722 | 714 |
Total | 24,269 | 0 | 12,763 | 8 | 37,040 | 72,642 |
Total Revenue Administered on behalf of the Government of Canada |
21,024,669 | 13,080 | 12,763 | 8 | 21,050,520 | 22,695,057 |
Bad Debts | 27,146 | 0 | 0 | 0 | 27,146 | 67,605 |
Net Administered Revenues | 20,997,523 | 13,080 | 12,763 | 8 | 21,023,374 | 22,627,452 |
The accompanying notes form an integral part of these financial statements.
(in thousands of dollars)
2010 | 2009 | |
---|---|---|
ADMINISTERED ASSETS | ||
Cash | 1,512,636 | 1,343,984 |
Amounts receivable from other Federal Government departments and agencies (Note 4) |
1,802,895 | 143,064 |
Taxes receivable (Note 5) | 1,040,162 | 1,070,172 |
TOTAL | 4,355,693 | 2,557,220 |
ADMINISTERED LIABILITIES | ||
Liabilities | ||
Amounts payable to other Federal Government departments and agencies |
56,035 | 37,846 |
Payable to provinces (Note 6) | 15,481 | 13,451 |
Taxes payable | 1,114 | 1,531 |
Deposit accounts (Note 7) | 8,931 | 7,022 |
Total Liabilities | 81,561 | 59,850 |
Net amount due to the Consolidated Revenue Fund on behalf of the Government of Canada (Note 8) |
4,274,132 | 2,497,370 |
TOTAL | 4,355,693 | 2,557,220 |
The accompanying notes form an integral part of these financial statements.
(in thousands of dollars)
2010 | 2009 | |
---|---|---|
Total Net Administered Revenues | 21,023,374 | 22,627,452 |
Change in administered assets and liabilities: | ||
(Increase) in cash | (168,652) | (72,870) |
Decrease (Increase) in accounts receivable | (1,659,831) | 3,638,383 |
Decrease in tax receivables | 30,010 | 306,436 |
(Decrease) Increase in accounts payable | 18,189 | (1,811,885) |
Increase in payable to provinces | 2,030 | 6,544 |
Increase in deposit accounts | 1,909 | 497 |
(Decrease) in tax payables | (417) | (21,039) |
Net cash Deposited in the Consolidated Revenue Fund of the Government of Canada |
19,246,612 | 24,673,518 |
Consisting of: | ||
Cash deposits to the Consolidated Revenue Fund | 21,554,869 | 28,066,029 |
Cash payments/refunds from the Consolidated Revenue Fund | (2,308,257) | (3,392,511) |
Net cash Deposited in the Consolidated Revenue Fund of the Government of Canada |
19,246,612 | 24,673,518 |
The accompanying notes form an integral part of these financial statements.
The Canada Border Services Agency (Agency) is responsible for providing integrated border services that support national security and public safety priorities and facilitate the free flow of persons and goods. The Canada Border Services Agency Act received royal assent on November 3, 2005. The Agency is a departmental corporation named in Schedule II of the Financial Administration Act and reports to Parliament through the Minister of Public Safety. The Agency is funded through appropriations from the Government of Canada.
The Agency is responsible for the administration and enforcement of the following acts or portions of these acts: the Customs Act, the Customs Tariff, the Excise Act, the Excise Tax Act, the Citizenship Act, the Immigration and Refugee Protection Act, as well as other acts on behalf of other federal departments and provinces.
In delivering efficient and effective border management that contributes to the security and prosperity of Canada, the Agency operates under the following program activities:
The financial statements have been prepared in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.
Significant accounting policies are as follows:
(a) Tax Revenues
Tax revenues reported in this statement include revenues assessed under the authority of the Customs Act, the Customs Tariff, the Excise Act and the Excise Tax Act. These taxes include:
The determination of the Agency's tax revenues is based on the taxes and duties assessed that relate to goods authorized by the Agency to enter into Canada during the fiscal year that ended March 31. These revenues are recognized at the time the goods are released.
The Canadian customs and tax systems are predicated on self-assessment where importers are expected to understand the laws and comply with them. This has an impact on the completeness of duty and tax revenues when importers fail to comply with laws, for example, if they do not declare or incorrectly declare goods imported. The Agency has implemented systems and controls in order to detect and correct situations where importers are not complying with the various acts it administers. These systems and controls include performing audits of importer records where determined necessary by the Agency. Such procedures cannot be expected to identify all undeclared or incorrectly declared importations or other cases of non-compliance. The Agency does not estimate the amount of unreported duties and taxes. However, such amounts are included in revenues when assessed.
(b) Non-tax revenues
Non-tax revenues reported in this statement include revenues collected on behalf of the Government of Canada under the Immigration and Refugee Protection Act, the Agriculture and Agri-Food Administrative Monetary Penalties Act and other similar legislation.
Non-tax revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenue.
(c) Cash
Cash includes amounts received in Agency offices or by Agency agents as at March 31 but not yet deposited to the credit of the Consolidated Revenue Fund (CRF) of the Government of Canada.
(d) Accounts receivable
Accounts receivable are stated at amounts expected to be ultimately realized; a provision is made for doubtful accounts where recovery is considered uncertain.
(e) Taxes receivable
Taxes receivable represent duties and taxes and other revenues assessed or estimated by the Agency but not yet collected. All receivables are stated at amounts ultimately expected to be realized. A provision is made for doubtful accounts where recovery is considered uncertain. This allowance for doubtful accounts reflects management's best estimate of the collectability of amounts assessed but not yet paid.
(f) Allowance for doubtful accounts
The allowance for doubtful accounts reflects management's best estimate of the collectability of amounts assessed, including the related interest and penalties, but not yet paid. The allowance for doubtful accounts is composed of two parts; which are reviewed on an annual basis. A portion of the allowance is based on the age of the accounts and the other portion is calculated based on accounts in dispute.
The allowance for doubtful accounts is adjusted by an annual provision for doubtful accounts and is reduced by amounts written off as uncollectable during the year. The annual provision is reported net of taxes receivable in the Statement of Administered Assets and Liabilities.
(g) Taxes payable
Taxes payable to importers represent refunds and related interest resulting from assessments completed after March 31 for excise duties, customs import duties and GST/HST for current or prior year imports.
(h) Contingent liabilities
Contingent liabilities are potential liabilities, which may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense recorded. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.
(i) Measurement uncertainty
The preparation of these financial statements, in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable.
The most significant item where estimates are used is the allowances for doubtful accounts. 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.
(j) Comparative information – Change in reporting entity - transition
For financial reporting purposes, the activities of the Agency have been divided into two sets of financial statements: Agency Activities and Administered Activities. The financial statements - Agency Activities include those operational revenues and expenses which are managed by the Agency and utilized in running the organization. The financial statements - Administered Activities include those net revenues that are administered for someone other than the Agency, such as the federal government, a province or territory, or another group or organization. The purpose of the distinction between Agency and Administered activities is to facilitate, among other things, the assessment of the administrative efficiency of the Agency in achieving its mandate.
The economic recession contributed to the reduction in GST/HST assessed on imported goods.
Furthermore, a change in methodology relating to the accounting of HST transfers to the provinces was also implemented. Prior to this fiscal year, the transfers of HST to the Department of Finance Canada were conducted by way of monthly installments based on a remittance schedule set by that department. The proportions remitted by the CBSA and the CRA were derived based on the net GST/HST revenues assessed by each agency, respectively. Commencing this fiscal year, the proportions remitted by the Agency and the CRA were reassessed and subsequently reduced. Consequently, the CRA will be remitting 100% of the estimate to the Department of Finance Canada and the Agency will be transferring actual Provincial HST revenues collected on an annual basis.
The following table presents details of the excise tax revenues:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
GST/HST | 16,261,032 | 19,243,932 |
Tax remission order | (40,333) | (89,363) |
Transfer of HST to Provinces | (14,432) | (1,888,287) |
Total | 16,206,267 | 17,266,282 |
Excise tax - gasoline | 28,714 | 34,448 |
Other excise tax | 31,874 | 47,286 |
Total | 60,588 | 81,734 |
Total excise taxes | 16,266,855 | 17,348,016 |
This value represents amounts due to the Agency from other Federal Government departments and agencies. Due to the change in methodology relating to the accounting of HST transfers to the provinces, the CRA will now be remitting 100% of the estimate to the Department of Finance Canada; with the Agency transferring actual Provincial HST amounts collected to the CRA on an annual basis. As the Agency had previously been remitting to the Department of Finance Canada on a monthly basis, the resultant overpayment will be recovered from the CRA.
The following table presents details of the amounts receivable:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
HST receivable from Canada Revenue Agency | 1,779,297 | 0 |
Receivables from other Federal Government departments and agencies |
23,598 | 143,064 |
Total | 1,802,895 | 143,064 |
Taxes receivable represent the customs duties, excise taxes, GST and HST due to the Receiver General for Canada as a result of importations into Canada.
The following table presents details of taxes receivable:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Taxes receivable | 1,166,744 | 1,209,436 |
Less: allowance for doubtful accounts | (126,582) | (139,264) |
Net taxes receivable | 1,040,162 | 1,070,172 |
The following table presents details on the memorandums of understanding (MOUs) that have been established between the provinces and the Agency, whereby the Agency collects provincial sales, alcohol and tobacco taxes on behalf of the provinces and remits these collections directly to the provinces.
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Payable to provinces, beginning of year | 13,451 | 6,907 |
Receipts from taxpayers | 107,180 | 179,841 |
Refunds to taxpayers | (4,081) | (2,361) |
Payments to provinces | (101,069) | (170,936) |
Payable to provinces, end of year | 15,481 | 13,451 |
The deposit accounts were established to record cash and securities required to guarantee payment of customs duties and excise taxes on imported goods pursuant to the Customs Act and the Excise Tax Act and to guarantee the compliance of transporters and individuals with the provisions of the Immigration and Refugee Protection Act.
The following table presents details on the deposit accounts:
Opening Balance |
Receipts | Payments | Closing Balance |
|
---|---|---|---|---|
(in thousands of dollars) | ||||
Guarantee deposit accounts | 7,022 | 2,213 | (304) | 8,931 |
The net amount due to the CRF on behalf of the Government of Canada is the difference between administered assets and other administered liabilities payable by the Agency out of the CRF.
The change in the net amount due to the CRF during the fiscal year is presented in the table below:
2010 | 2009 | |
---|---|---|
(in thousands of dollars) | ||
Net amount due to the Consolidated Revenue Fund on behalf of the Government of Canada at the beginning of the year |
2,497,370 | 4,543,436 |
Total net administered revenues | 21,023,374 | 22,627,452 |
Net cash deposited in the Consolidated Revenue Fund of the Government of Canada |
(19,246,612) | (24,673,518) |
Net amount due to the Consolidated Revenue Fund on behalf of the Government of Canada at end of year | 4,274,132 | 2,497,370 |
Claims have been made against the Agency in the normal course of operations. Appeals for previously assessed customs duties, excise duties, GST and HST have been received in the amount of $176,000,000 ($111,000,000 in 2009).
Some of these claims and appeals may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability and expense are recorded in the financial statements. In this regard, the Agency has not recorded an estimated liability for claims and appeals (2009 “NIL”).
The Agency is related in terms of common ownership to all Government of Canada departments, agencies and Crown corporations. The Agency enters into transactions with these entities in the normal course of business and on normal trade terms.
Separate financial statements have been prepared for the Agency's Administered Activities and Agency Activities commencing in 2010. The purpose of this is to more accurately represent the actual cost of Agency operations from those revenues that are administered on behalf of the Government of Canada.
Comparative figures have been reclassified to conform to the current year's presentation. The 2009 amounts have been restated to exclude Agency Activities. Furthermore, amounts payable to and receivable from Agency Activities were eliminated upon consolidation in fiscal year 2009. These have been subsequently included within the 2009 amounts for comparative purposes.
The following table outlines the restated comparison of key amounts:
Administered Activities | Agency Activities | Total (restated) | Total (Previously Reported) | Difference | ||||||
---|---|---|---|---|---|---|---|---|---|---|
2009 | + | 2009 | = | 2009 | - | 2009 | = | 2009 | ||
(in thousands of dollars) | ||||||||||
Statement of Operations | ||||||||||
Total Tax Revenues | 22,622,415 | + | 0 | = | 22,622,415 | - | 22,622,415 | = | 0 | |
Total Non-Tax Revenues | 72,642 | + | 28,202 | = | 100,844 | - | 100,844 | = | 0 | |
Total Expenses | 67,605 | + | 1,799,053 | = | 1,866,658 | - | 1,866,659 | = | -1* | |
Total Net Revenues (Cost of Operations) | 22,627,452 | + | (1,770,851) | = | 20,856,601 | - | 20,856,600 | = | 1* | |
* The difference is due to the rounding as a result of adding amounts from two different trial balances, compared to the rounding when using one trial balance. |
||||||||||
Statement of Financial Position | ||||||||||
Total Assets | 2,557,220 | + | 402,367 | = | 2,959,587 | - | 2,957,608 | = | 1,979** | |
Total Liabilities | 59,850 | + | 479,688 | = | 539,538 | - | 537,559 | = | 1,979** | |
Total Equity of Canada (Deficit of Canada) | 2,497,370 | + | (77,321) | = | 2,420,049 | - | 2,420,049 | = | 0 | |
** The difference is due to the total payables and receivables between CBSA Administered Activities and CBSA Agency Activities eliminated from the Financial Statements in last year's presentation since both trial balances were included. This year, the payables and receivables are on different financial statements and cannot be eliminated. |
With the new Treasury Board Policy on Internal Control, effective April 1, 2009, departments are now required to demonstrate the measures they are taking to maintain an effective system of internal control over financial reporting (ICFR).
As part of this policy, departments are expected to conduct annual assessments of their system of ICFR, establish action plan(s) to address any necessary adjustments, and to attach to their Statements of Management Responsibility a summary of their assessment results and action plan.
Effective systems of ICFR aim to achieve reliable financial statements and to provide assurances that:
It is important to note that the system of ICFR is not designed to eliminate all risks, but rather to mitigate risk to a reasonable level, incorporating controls that are balanced and proportionate to the risks they aim to mitigate.
The maintenance of an effective system of ICFR is an ongoing process designed to identify and prioritize risks and the controls to mitigate these risks, as well as to monitor its performance in support of continuous improvement. As a result, the scope, regularity and status of departmental assessments of the effectiveness of their system of ICFR will vary from one organization to another based on risks and taking into account their unique circumstances.
This document is attached to the Canada Border Services Agency (CBSA) Statement of Management Responsibility Including Internal Control over Financial Reporting as required by the new Treasury Board Policy on Internal Control, effective April 1, 2009. This document provides summary information of the measures taken by the CBSA to maintain an effective system of internal control over financial reporting (ICFR). Specifically, it provides information of the assessments conducted by the CBSA and the related status of ICFR as of March 31, 2010; which includes progress, results, action plans and financial highlights pertinent to the CBSA’s control environment. For fiscal year 2009-10, the financial statements for the Agency’s activities (expenditures) and administered activities (revenues) are reported separately.
Detailed information on the CBSA's authority, mandate and program activities can be found in the Departmental Performance Report [Estimates & Supply] and the Report on Plans and Priorities [Estimates & Supply].
The CBSA conducts a significant portion of its financial activities in offices located in the Regions and the Headquarters Branches. These activities, which include the processing and recording of financial transactions, are monitored, reviewed and verified by the Comptrollership Branch under the Direction of the Chief Financial Officer.
Financial statements (unaudited) of the Agency activities (expenditures) for fiscal-year 2009-2010 can be found at [Corporate Documents]. Information can also be found in the Public Accounts of Canada [Receiver General for Canada].
Agency administered activities (revenues)
Financial statements (unaudited) of the Administered activities (revenues) for fiscal-year 2009-2010 can be found at [Corporate Documents]. Information can also be found in the Public Accounts of Canada [Receiver General for Canada].
The CBSA relies on other organizations for the processing of certain transactions that are recorded in its financial statements.
As previously stated, for fiscal year 2009-2010, the financial statements have been divided in two: Agency Activities (expenditures) and Administered Activities (revenues). This change has been implemented to inform the readers of the financial statements of the cost of operations (Agency activities) separate from the revenues administered on behalf of the Government of Canada.
The CBSA recognizes the importance of setting the tone from the top to help ensure that staff at all levels understand their roles in maintaining effective systems of ICFR and is well equipped to exercise these responsibilities effectively. The CBSA’s focus is to ensure risks are managed well through a responsive and risk-based control environment that enables continuous improvement and innovation.
The following are the CBSA’s key positions and committees with responsibilities for maintaining and reviewing the effectiveness of its system of ICFR.
President – The President, as Accounting Officer, assumes overall responsibility and leadership for the measures taken to maintain an effective system of internal control. In this role, the President chairs the Departmental Audit Committee and the Executive Management Committee. In addition, there are five standing committees that support the Executive Management Committee which address: Operations, Technology, Comptrollership, Programs, and Human Resources.
Executive Vice-President – The Executive Vice-President (EVP), reports directly to the President. In this role, the EVP is the primary support to the President in discharging his obligations as Accounting Officer and for ensuring that an effective system of internal control is in place and functioning as intended. The EVP also chairs the Operations committee.
Chief financial Officer (CFO) – The CFO reports directly to the President and provides leadership for the coordination, coherence and focus on the design and maintenance of an effective system of ICFR. The CFO chairs the Comptrollership Standing committee (CSC), and associate VP of operations, and its membership includes the Vice Presidents of Programs and Science and Technology, the Chief Audit Executive and Director Generals from Operations and Programs. The CSC monitors operating and capital budgets, Administered activities (revenues), reviews financial and administrative strategies, identify risks and recommends mitigation strategies.
Vice Presidents– The Vice Presidents are responsible for maintaining and assessing the effectiveness of the system of ICFR within their respective areas of responsibility.
Chief Audit Executive (CAE)– The CAE reports directly to the President and provides assurance through periodic internal audits which are instrumental to the maintenance of an effective system of ICFR.
Departmental Audit Committee (DAC) - The DAC is an advisory committee that provides objective views on the Agency’s risk management, control and governance frameworks. The DAC was established in 2007 and it is comprised of the President, the EVP and four external members. As such, the DAC reviews the CBSA’s Risk Profile and its system of internal control, including the assessment and action plans relating to the system of ICFR.
The CBSA's control environment incorporates a series of measures that provide employees with the knowledge, the tools and resources required to identify and manage risk effectively. These measures include:
In 2004, the Government of Canada commenced an initiative to determine the ability of departments to sustain control-based audits of their financial statements, thus placing reliance on well functioning internal controls. As a result in 2006, the largest departments, including the CBSA, began formalizing their approach to managing their systems of ICFR, including readiness assessments and action plans.
Whether it is to support control-based audits or meet the requirements of the Policy on Internal Control, the CBSA needs to be able to maintain an effective system of ICFR with the objective to provide reasonable assurance that:
In view of that, the CBSA is required to assess the design and operating effectiveness of its system of ICFR as well as to put in place an on-going monitoring program to sustain and continuously improve the system of ICFR.
Design effectiveness means to ensure that key control points are identified, documented, in place and that they are aligned with the risks they aim to mitigate and that any required remediation is addressed. This includes the mapping of key processes and IT systems to the main accounts by location as applicable.
Operating effectiveness means that key controls have been tested over a defined period and that any required remediation is addressed.
On-going monitoring program means that a systematic integrated approach to monitoring is in place, including periodic risk-based assessments and timely remediation. This on-going monitoring program covers all departmental control levels which include corporate and entity general computer and business process controls.
In continuing the preparation for its control-based audit of the financial statements, the CBSA has taken measures to assess its system of ICFR starting with the following financial statements main accounts:
The CBSA documented key processes using a standardized format. Key processes were identified considering both the quantitative and qualitative nature of the process and associated risks. Control frameworks have been created for the following:
For each significant account/location, the CBSA completed the following steps:
The CBSA has also documented its corporate (entity) level controls. Other key activities such as Procurement activities, Asset Security control frameworks and IT general system controls (IT infrastructure) will be completed during fiscal year 2010-2011.
In developing control frameworks, the CBSA has also taken into account information available from recent audits, including a recent independent testing of the opening balance sheet.
As of year end 2009-10, the CBSA was in the process of finalizing its control frameworks of all key expenditure processes. The testing of operating effectiveness of the payment requisitioning process was also underway.
When undertaking design effectiveness testing, the CBSA completed all documentation and ensured whether the process and related documentation is in place and corresponded to actual practices. These activities covered both headquarters and all regional offices. Design effectiveness also included ensuring appropriate alignment of each key control with the risks they aimed to mitigate.
Based on design effectiveness testing phase, the Agency has better articulated particular control frameworks that support the overall effective control environment. For example, the following improvements were identified:
Documentation:
Data reconciliation and integrity:
IT general system management controls:
Monitoring and quality assurance of financial statement preparation:
In fiscal year 2010-2011, a cascading certification process will be introduced, requiring process owners, accountable managers and executives to attest to the design and implementation of controls.
In 2009-10, the CBSA commenced the assessment of operating effectiveness of the payment requisition key controls. The Agency identified and tested these key controls, based on risk and location, defined the appropriate test-period as well as the method and frequency of testing. Remediation requirements have been partially addressed and plans are underway to complete it before end of 2010-11 fiscal year.
During 2009-2010, CBSA has continued to make significant progress in assessing and improving its key controls over ICFR. Below is a summary of the main progress achieved by the CBSA.
The CBSA has completed work to address the following necessary adjustments:
The CBSA has substantially advanced work to address the following necessary adjustments:
Building on the progress to date, the CBSA is positioned to complete the assessment of its system of ICFR in 2011-12. As of March 2010, the design effectiveness phase was well under way.
By end of fiscal year 2010-11, the CBSA plans to:
By end of fiscal year 2011-12, the CBSA plans to:
The CBSA will be modernizing and making significant improvements to the systems and processes that support the administration of revenues. These improvements will also facilitate the Agency’s capacity to sustain a control-based audit and meet the requirements under the Policy on Internal Control for ICFR. The CBSA Assessment and Revenue Management (CARM) and the Accounts Receivable Sub-ledger (ARL) systems are the principal initiatives which will enable these improvements, and are scheduled to begin in fiscal year 2010-11. With the implementation of these systems and expected impact on business processes and related controls, the various phases (Design and Operating effectiveness and On-going monitoring) to support ICFR will be developed as these systems are conceived and implemented.
As at year end 2009-10, certain measures and audits have been completed to improve and/or verify the effectiveness of certain internal controls in the Agency administered activities (revenues). These measures and audits include the following:
Internal Audit of Cash Cut-Off Procedures:
Cash Management Review:
Audit of the Payment Process for Importer/Broker Account Statements:
By end of fiscal year 2010-11, the CBSA plans to:
Revenue Management
Systems Improvements
In 2010-11, work will begin to implement the CBSA Assessment and Revenue Management (CARM) and the Accounts Receivable Sub-ledger (ARL). The primary focus of these initiatives is to provide a viable solution to obtain accurate, timely, complete and reliable financial information and manage and account for tax revenues efficiently and effectively.
By end of fiscal year 2011-12, the CBSA plans to:
Revenue Management
Systems Improvements
In 2011-12, work will continue to implement the CBSA Assessment and Revenue Framework (CARM) and the Accounts Receivable Sub-ledger (ARL).
By end of fiscal year 2012-13, the CBSA plans to:
Revenue Management
Systems Improvements