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Section III: Supplementary Information
3.1 Link to Government of Canada Outcome Areas
The Government of Canada’s performance reporting framework consists of thirteen outcomes grouped under three spending areas: Economic, Social and International Affairs. In addition, the PPSC, like several government organizations, provides advice that supports other government departments and agencies. These services are aligned with a fourth spending area, Government Affairs. The table below illustrates how the PPSC’s four program activities are linked to Canada’s performance.
| Strategic Outcome: Prosecute criminal offences under federal law in a manner that is independent of any improper influence and respects the public interest. | ||||
|---|---|---|---|---|
| Actual Spending 2007-2008 ($ millions) |
Alignment to Government of Canada Outcome Area | |||
| Budgetary | Non-budgetary | Total | ||
| Program Activity #1: Prosecution of drug, organized crime and Criminal Code offences | 85.9 | N/A | 85.9 | Social Affairs Government Affairs |
| Program Activity #2: Prosecution of federal offences to protect the environment, natural resources, economic and social health | 18.8 | N/A | 18.8 | Economic Affairs Social Affairs Government Affairs |
| Program Activity #3: Addressing criminal issues, in the context of prosecutions, to contribute to a safer world for Canada | 4.4 | N/A | 4.4 | International Affairs Government Affairs |
| Program Activity #4: Promoting a fair and effective justice system that reflects Canadian values within a prosecutorial context | 0.8 | N/A | 0.8 | Social Affairs Economic Affairs International Affairs |
| Total | 109.9 | - | 109.9 | |
(For more information about the Government of Canada’s four broad Spending Areas and the corresponding 13 Outcomes, visit http://www.tbs-sct.gc.ca/ppg-cpr/Home-Accueil-eng.aspx.)
3.2 Partners
Department of Justice Canada
The PPSC continues to work closely and cooperatively with the Department of Justice Canada. Federal prosecutors benefit from consultations with Justice counsel in areas such as human rights law, constitutional law, Aboriginal law and criminal law policy. Both the PPSC and the Department provide legal advice to investigative agencies.
From an administrative perspective, the PPSC continues to rely on the Department for most transactional corporate services.
Investigative Agencies
The PPSC works with several investigative agencies, including the RCMP and other police forces. It also works with the enforcement arms of federal departments and agencies, including the Competition Bureau, the Canada Revenue Agency, the Canada Border Services Agency, Fisheries and Oceans Canada, Environment Canada, and Health Canada.
Investigations that target sophisticated organizations or that use techniques that have not received definitive judicial consideration usually require ongoing advice from prosecutors. The complexity of the law and the high costs of multi-year investigations make it increasingly important for police to know as early as possible the impact of their decisions on potential prosecutions. In an era where considerable time in a trial can be spent analyzing investigative decisions, the PPSC provides ongoing legal advice before a charge is laid.
As well, certain key evidence gathering orders require – or may benefit from – the involvement of PPSC counsel. This includes wiretap applications and orders to produce potential evidence. In this capacity, counsel ensures that the court has what it needs in order to decide whether the police should be empowered to do what they are asking.
The early and ongoing involvement of prosecutors both during major investigations and in the implementation of national enforcement programs helps ensure that the police and other investigative agencies benefit from legal advice to decide how best to enforce the law.
Provinces
Jurisdiction over prosecutions is shared between the federal and provincial governments. From this shared responsibility, the need arises for cooperation and coordination in the enforcement of criminal law. For example, the PPSC may prosecute Criminal Code offences which fall under the jurisdiction of provincial Attorneys General with their consent and on their behalf, where it is more efficient and cost-effective to do so. This generally occurs where the Criminal Code offences are related to some federal charge, such as firearms offences related to a drug charge.
Similarly, a provincial prosecution service may prosecute a drug charge where the charge is one of many offences and where the major offence is one within its jurisdiction. Such arrangements are called “major-minor
” agreements, meaning that the prosecution service responsible for prosecuting the “major
” charge will prosecute the “minor
” one as well. On February 10, 2007, the Director was assigned the power to conduct prosecutions that the Attorney General of Canada is authorized to undertake under such agreements.
Major cases that involve serious Criminal Code and other federal offences are also increasingly being prosecuted by joint prosecution teams, particularly in organized crime files.
3.3 Supplementary Tables
Table 1: Comparison of Planned to Actual Spending (including FTEs)
| 2007-2008 | ||||||
|---|---|---|---|---|---|---|
| ($ millions) | 2005-2006 Actual | 2006-2007 Actual | Main Estimates | Planned Spending | Total Author- ities |
Actual |
| Prosecution of drug, organized crime and Criminal Code offences | N/A | N/A | 75.7 | 99.2 | 94.4 | 85.9 |
| Prosecution of federal offences to protect the environment, natural resources, economic and social health | N/A | N/A | 17.6 | 19.9 | 19.1 | 18.8 |
| Addressing criminal issues to contribute to a safer word for Canada | N/A | N/A | 4.3 | 5.1 | 4.8 | 4.4 |
| Promoting a fair and effective justice system that reflects Canadian values in a prosecutorial context. | N/A | N/A | 0.9 | 1.1 | 0.9 | 0.8 |
| Total | 98.5 | 125.3 | 119.2 | 109.9 | ||
| Less: Non-respendable revenue | N/A | N/A | N/A | N/A | N/A | 1.2 |
| Plus: Cost of services received without charge | N/A | N/A | 9.5 | 9.5 | N/A | 11.6 |
| Total Organizational Spending | 108.0 | 134.8 | 119.2 | 120.3 | ||
| Full time equivalents | N/A | N/A | 674 | 724 | - | 748 |
Table 2: Voted and Statutory Items
| ($ thousands) | 2007-2008 | ||||
|---|---|---|---|---|---|
| Vote or Statutory Item | Truncated Vote or Statutory Wording | Main Estimates | Planned Spending | Total Authorities | Actual |
| Vote 35 | Program expenditures | 86.3 | 112.1 | 109.1 | 99.8 |
| - | Capital expenditures | N/A | N/A | N/A | N/A |
| - | Grants and contributions | N/A | N/A | N/A | N/A |
| - | Minister - Salary and motor car allowance | N/A | N/A | N/A | N/A |
| - | Contributions to employee benefit plans |
12.2 | 13.2 | 10.1 | 10.1 |
| Total | 98.5 | 125.3 | 119.2 | 109.9 | |
Table 3: Sources of Respendable and Non-Respendable Revenue
For supplementary information on the PPSC’s sources of respendable and non respendable revenue please visit: http://www.tbs-sct.gc.ca/dpr-rmr/2007-2008/index-eng.asp
Table 4: Reporting on Horizontal Initiatives
During 2007-2008, the PPSC participated in two horizontal initiatives: the Federal Tobacco Control Strategy led by Health Canada, and the Public Security and Anti-Terrorism (PSAT) initiative, led by Public Safety Canada.
Supplementary information on horizontal initiatives can be found at
http://www.tbs-sct.gc.ca/rma/eppi-ibdrp/hrdb-rhbd/profil_e.asp.
Table 5: Internal Audits and Evaluations
No internal audits or evaluations were conducted during 2007-2008.
Table 6: Travel Policies
The PPSC follows the Treasury Board of Canada Secretariat Special Travel Authorities and the Treasury Board of Canada Secretariat Travel Directive, Rates and Allowances.
Supplementary information on travel policies can be found at
http://publiservice.tbs-sct.gc.ca/pubs_pol/hrpubs/TBM_113/menu-travel-voyage_e.asp
Table 7: Financial Statements
All federal government departments and agencies as defined in section 2 of the Financial Administration Act and departments with revolving funds are to include their financial statements in their Departmental Performance Report.
Financial Statements (Unaudited) - For the Year Ended March 31, 2008
Management Responsibility for Financial Statements
Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2008 and all information contained in these statements rests with PPSC management. These financial statements have been prepared by management in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.
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 organization’s financial transactions. The financial statements included in this Departmental Performance Report are consistent with financial information submitted to the Public Accounts of Canada.
Management maintains a system of financial management and internal control designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are in accordance with the Financial Administration Act, are executed in accordance with prescribed regulations, within Parliamentary authorities, and are properly recorded to maintain accountability of Government funds. Management also seeks to ensure the objectivity and integrity of data in its financial statements by careful selection, training and development of qualified staff, by organizational arrangements that provide appropriate divisions of responsibility, and by communication programs aimed at ensuring that regulations, policies, standards and managerial authorities are understood throughout the organization.
The financial statements of the PPSC have not been audited.
Original copy signed by
Ottawa, Canada
Date August 15, 2008
Statement of Financial Position (unaudited)
As at March 31
(in thousands)
| Assets | 2008 |
|---|---|
| Financial assets | |
| Receivables (Note 6) | 5,528 |
| Advances (Note 7) | 5 |
| Total financial assets | 5,533 |
| Non-financial assets | |
| Tangible capital assets (Note 8) | 4,375 |
| Total non-financial assets | 4,375 |
| Total | 9,908 |
| Liabilities and Equity of Canada | 2008 |
|---|---|
| Liabilities | |
| Accounts payable and accrued liabilities (Note 9) | 14,326 |
| Vacation pay and compensatory leave | 2,548 |
| Employee severance benefits (Note 10) | 12,553 |
| Total liabilities | 29,427 |
| Equity of Canada | (19,519) |
| Total | 9,908 |
Contingent liabilities (Note 11)
The accompanying notes form an integral part of these financial statements.
Statement of Operations (unaudited)
For the year ended March 31
(in thousands)
| Expenses (Note 4) | 2008 |
|---|---|
| Prosecution of drug, organized crime and Criminal Code offences | 94,399 |
| Prosecution of federal offences to protect the environment, natural resources, economic and social health | 30,621 |
| Addressing criminal issues, in the context of prosecutions, to contribute to a safer world for Canada | 4,828 |
| Promoting a fair and effective justice system that reflects Canadian values within a prosecutorial context | 897 |
| Total expenses | 130,745 |
| Revenues (Note 5) | 2008 |
|---|---|
| Prosecution of federal offences to protect the environment, natural resources, economic and social health | 10,809 |
| Prosecution of drug, organized crime and Criminal Code offences | 1,201 |
| Total revenues | 12,010 |
| Net cost of operations | 118,735 |
The accompanying notes form an integral part of these financial statements.
Statement of Equity of Canada (unaudited)
For the year ended March 31
(in thousands)
| 2008 | |
|---|---|
| Equity of Canada, beginning of year | 0 |
| Net cost of operations | (118,735) |
| Current year appropriations used (Note 3) | 109,939 |
| Revenue not available for spending | (1,230) |
| Change in net position in the Consolidated Revenue Fund (Note 3) | (1,855) |
| Net asset transfer from Department of Justice (Note 13) | (19,250) |
| Services provided without charge by other government departments (Note 12) | 11,612 |
| Equity of Canada, end of year | (19,519) |
The accompanying notes form an integral part of these financial statements.
Statement of Cash Flow (unaudited)
For the year ended March 31
(in thousands)
| Operating activities | 2008 |
|---|---|
| Net cost of operations | 118,735 |
| Non-cash items | |
| Amortization of tangible capital assets (Note 8) | (1,451) |
| Services provided without charge by other government departments (Note 12) | (11,612) |
| Variations in Statement of Financial Position | |
| Increase in accounts receivable and advances | 5,533 |
| Increase in liabilities | (29,427) |
| Cash used by operating activities | 81,778 |
| Capital investment activities | 2008 |
|---|---|
| Acquisitions of tangible capital assets (Note 8) | 851 |
| Transfer of tangible capital assets from Justice (Note 8) | 4,975 |
| Proceeds from disposal of tangible capital assets | 0 |
| Cash used by capital investment activities | 5,826 |
| Financing activities | 2008 |
|---|---|
| Net cash provided by Government of Canada | (106,854) |
| Net asset transfer from Department of Justice (Note 13) | 19,250 |
| Cash used by financing activities | (87,604) |
The accompanying notes form an integral part of these financial statements.
Notes to the Financial Statements (Unaudited)
1. Authority and objectives
Under this program activity, the PPSC provides prosecution-related advice and litigation support during the police investigation, and prosecutes all drug charges under the Controlled Drugs and Substances Act, regardless of whether a federal, provincial or municipal police agency lays the charges, except in the case of Quebec and New Brunswick, where the PPSC prosecutes drug charges laid by the RCMP. The PPSC also prosecutes organized crime cases, and, pursuant to understandings with the provinces, Criminal Code offences where they are related to drug charges and the drug aspect forms the major part of the case. In the three territories, the PPSC prosecutes all Criminal Code offences. The operational priority for prosecution-related advice provided during the investigative stage is primarily on cases of high complexity and that involve a high level of legal risk.
PA 2: Prosecution of federal offences to protect the environment, natural resources, economic and social health
Under this program activity, the PPSC provides advice and litigation support to federal investigative agencies, and prosecutes federal offences under 50 federal statutes upholding the mandates and policies of federal departments, e.g. Fisheries Act, Income Tax Act, Copyright Act, Canadian Environmental Protection Act. The PPSC also provides advice and prosecutes complex capital market fraud cases.
PA 3: Addressing criminal issues, in the context of prosecutions, to contribute to a safer world for Canada
Under this program activity, the PPSC prosecutes offences under such federal statutes as the Proceeds of Crime (Money Laundering) Terrorist Financing Act, Customs Act, Excise Act, and the Excise Tax Act to combat trans-national crime and terrorism. As well, the PPSC may provide counsel to assist in the execution of extradition and mutual legal assistance requests before Canadian courts under the Extradition Act, and the Mutual Legal Assistance in Criminal Matters Act.
Under this program activity, the PPSC contributes to strengthening the criminal justice system across Canada and improving its efficiency by providing legal training to police, and by promoting federal/provincial/ territorial cooperation within the prosecution community on important shared issues.
2. Summary of significant accounting policies
a) Parliamentary appropriations
- Revenues derived from the provision of legal services are recognized in the year the services are rendered.
- Fines, forfeitures and court costs are recognized upon receipt of payment by the organization.
- Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
- Expenses related to the provision of legal services are limited to those costs borne and settled directly by the organization. These legal services may or may not be recovered as revenue from the client organization. The cost of legal services which are paid directly by client organizations to outside suppliers such as legal agents, are not included in the expenses of the organization.
- Services provided without charge by other government departments for accommodation, the employer’s contribution to the health and dental insurance plans, and workers' compensation coverage are recorded as operating expenses at their estimated cost.
- Pension benefits Eligible employees participate in the Public Service Pension Plan, a multiemployer plan administered by the Government of Canada. The organization's contributions to the Plan are charged to expenses in the year incurred and represent the total organizational obligation to the Plan. Current legislation does not require the organization to make contributions for any actuarial deficiencies of the Plan.
- Severance benefits Employees are entitled to severance benefits under labour contracts or conditions of employment. These benefits are accrued as employees render the services necessary to earn them. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.
h) Contingent liabilities
i) Tangible capital assets
| Asset class | Acquisition cost equal or greater than | Amortization period |
|---|---|---|
| Office and other equipment | $10,000 | 5 to 8 years |
| Telecommunications equipment | $10,000 | 4 to 5 years |
| Informatics hardware | $1,000 | 3 to 5 years |
| Informatics software | $10,000 | 3 to 5 years |
| Furniture and furnishings | $1,000 | 10 years |
| Motor vehicles | $10,000 | 5 years |
| Leasehold improvements | $10,000 | Lesser of useful life or term of the lease |
| Work in progress | In accordance with asset class | Once in service, in accordance with asset class |
j) Measurement uncertainty
3. Parliamentary appropriations
(a) Reconciliation of net cost of operations to current year appropriations used
| ($ thousands) | 2008 | |
|---|---|---|
| Net cost of operations | 118,735 | |
| Adjustments for items affecting net cost of operations but not affecting appropriations | ||
| Add (Less) | ||
| Services provided without charge by other government departments (Note 12) | (11,612) | |
| Amortization of tangible capital assets (Note 8) | (1,451) | |
| Employee severance benefits | (1,164) | |
| Vacation pay and compensatory leave | (120) | |
| Receivables from external parties | 312 | |
| Revenue not available for spending | 1,230 | |
| Employee benefits plan (EBP) (part of employer) component of legal services revenue | 1,527 | |
| Refunds and reversals of previous year expenses | 1,631 | |
| (9,647) | ||
| Adjustments for items not affecting net cost of operations but affecting appropriations | ||
| Add | ||
| Acquisitions of tangible capital assets (Note 8) | 851 | |
| Current year appropriations used | 109,939 | |
(b) Appropriations provided and used
| ($ thousands) | 2008 |
|---|---|
| Vote 35 - Program expenditures | 109,088 |
| Statutory amounts | 10,150 |
| 119,238 | |
| Less | |
| Voted authorities lapsed | (9,299) |
| Current year appropriations used | 109,939 |
(c) Reconciliation of net cash provided by Government to current year appropriations used
| ($ thousands) | 2008 |
|---|---|
| Net cash provided by Government | 106,854 |
| Revenue not available for spending | 1,230 |
| 108,084 | |
| Change in net position in the Consolidated Revenue Fund | |
| Adjustments and refunds of previous year accounts payable | 1,631 |
| Employee benefits component of legal services revenue | 1,527 |
| Other adjustments | (1,303) |
| 1,855 | |
| Current year appropriations used | 109,939 |
4. Expenses
| ($ thousands) | 2008 |
|---|---|
| Operating | |
| Salaries and employee benefits | 85,806 |
| Professional and special services | 26,702 |
| Accommodation | 8,084 |
| Travel and relocation | 4,110 |
| Utilities, materials and supplies | 1,710 |
| Amortization of tangible capital assets | 1,451 |
| Communications | 1,215 |
| Information | 867 |
| Other | 356 |
| Rentals | 269 |
| Repairs and maintenance | 152 |
| Claims and ex-gratia payments | 23 |
| Total operating expenses | 130,745 |
5. Revenues
| ($ thousands) | 2008 |
|---|---|
| Services | |
| Legal services | 10,809 |
| Other revenues | |
| Fines and forfeitures | 911 |
| Rent from residential housing provided to employees | 316 |
| Other | (26) |
| 1,201 | |
| Total revenues | 12,010 |
6. Receivables
| ($ thousands) | 2008 |
|---|---|
| Federal government departments and agencies | 5,137 |
| External parties | 391 |
| Total receivables | 5,528 |
7. Advances
| ($ thousands) | 2008 |
|---|---|
| Standing advances held by employees for travel and petty cash | 5 |
| Total advances | 5 |
8. Tangible capital assets
| ($ thousands) | Cost | Accumulated amortization | 2008 | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Capital asset class | Opening balance | Acqui- sitions |
Disposals and transfers | Closing balance | Opening balance | Current Year amor- tization |
Disposals and transfers | Closing balance | Net book value |
| Office and other equipment | 17 | 0 | 0 | 17 | 0 | 0 | 0 | 0 | 17 |
| Telecommu- nications equipment |
0 | 0 | 12 | 12 | 0 | 0 | 0 | 0 | 12 |
| Informatics hardware | 1,029 | 303 | (12) | 1,320 | 471 | 257 | 0 | 728 | 592 |
| Informatics software | 91 | 131 | 0 | 222 | 67 | 17 | 0 | 84 | 138 |
| Furniture and furnishings | 491 | 368 | 0 | 859 | 153 | 71 | 0 | 224 | 635 |
| Motor vehicles | 56 | 0 | 0 | 56 | 29 | 10 | 0 | 39 | 17 |
| Leasehold improvements | 5,722 | 0 | 103 | 5,825 | 1,814 | 1,096 | 0 | 2,910 | 2,915 |
| Work in progress - leasehold improvements | 103 | 49 | (103) | 49 | 0 | 0 | 0 | 0 | 49 |
| Total tangible capital assets | 7,509 | 851 | 0 | 8,360 | 2,534 | 1,451 | 0 | 3,985 | 4,375 |
Transfer of tangible assets from Department of Justice equals opening balance of costs less opening balance of accumulated amortization, $4,975.
9. Accounts payable and accrued liabilities
| ($ thousands) | 2008 |
|---|---|
| Federal government departments and agencies | |
| Accounts payable | 310 |
| External parties | |
| Accounts payable | 11,916 |
| Accrued salaries | 1,900 |
| Other liabilities | 200 |
| 14,016 | |
| Total accounts payable and accrued liabilities | 14,326 |
10. Employee benefits
Both the employees and the PPSC contribute to the cost of the Plan. The expense presented below represents approximately 2.1 times (2.2 in 2006-07) the contributions by employees.
| ($ thousands) | 2008 |
|---|---|
| Pension expense | 7,378 |
The organization'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.
The organization 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:
| ($ thousands) | 2008 |
| Accrued benefit obligation, beginning of year | 11,389 |
|---|---|
| Expense for the year | 1,732 |
| Benefits paid during the year | (568) |
| Accrued benefit obligation, end of year | 12,553 |
11. Contingent liabilities
Claims have been made against the organization in the normal course of operations. Legal proceedings for claims totalling approximately $5,770,000 were still pending at March 31, 2008. Some of these potential liabilities may become actual liabilities when the event occurs or fails 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. An amount of $200,000 has been recorded for the fiscal year 2007-2008.
12. Related party transactions
Also, during the year, the organization received, without charge from other departments, accommodation, the employer's contribution to the health and dental insurance plans, and workers' compensation coverage. These services without charge have been recognized in the organization's Statement of Operations as follows:
| ($ thousands) | 2008 |
|---|---|
| Accommodation provided by Public Works and Government Services Canada | 6,915 |
| Employer's contributions to the health and dental insurance plans paid by Treasury Board Secretariat | 4,697 |
| Total | 11,612 |
The Government has structured some of its administrative activities for efficiency and cost-effectiveness purposes so that one department performs these on behalf of all without charge. The cost 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 organization's Statement of Operations.
In addition, the Office of the Director of Public Prosecutions has provided legal services without charge to other government departments throughout the fiscal year for a total amount of $8,793,753.
13. Organizational reorganization - Net asset transfer
The summary of assets and liabilities related to the activities transferred from the Department of Justice to the PPSC, as of April 2007, are provided below:
| ($ thousands) | 2007 |
|---|---|
| Statement of Financial Position | |
| Assets | 7,634 |
| Liabilities | (26,884) |
| Net liabilities for transfer | (19,250) |
14. Comparative information