Table of Contents
Notes to Future-oriented Financial Statements (unaudited)
1. Authority and Objectives
The Veterans Review and Appeal Board was established in 1995 pursuant to the Veterans Review and Appeal Board Act. The Veterans Review and Appeal Board received full departmental status by Order in Council in 2009.
The Veterans Review and Appeal Board is a division of the public service named in Schedule I.1 of the Financial Administration Act. The Minister of Veterans Affairs is designated the appropriate Minister for the Veterans Review and Appeal Board in Parliament and at Cabinet.
The Board's objective is to ensure that Canada's traditional Veterans, Canadian Armed Forces members and Veterans, Royal Canadian Mounted Police applicants, qualified civilians and their families receive the disability pensions, disability awards and other benefits to which they are entitled under the law.
2. Underlying Assumptions
The future-oriented statement of operations has been prepared on the basis of government priorities and departmental plans as described in the Report on Plans and Priorities.
The information in the estimated results for fiscal year 2014-15 is based on actual results as at December 31, 2014 and on forecasts for the remainder of the fiscal year. Forecasts have been made for planned results for the 2015-16 fiscal year.
The main assumptions underlying the forecasts are as follows:
- as at 31 December, 2014
- on the basis of government policies, government priorities, and external environment at the time the future-oriented financial information was finalized.
- according to the requirements of Treasury Board Accounting Policies which are based on Canadian generally accepted accounting principles for the public sector.
- on the basis that the resources provided will enable the Veterans Review and Appeal Board to deliver the expected results specified in the Report on Plans and Priorities.
- on the basis of historical costs.
3. Variations and Changes to the Forecast Financial Information
While every attempt has been made to accurately forecast final results for the remainder of 2014-15 and for 2015-16, actual results achieved for both years are likely to vary from the forecast information presented, and any variation could be material.
In preparing these future-oriented financial statements, the Veterans Review and Appeal Board has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Factors that could lead to material differences between the future-oriented financial statements and the historical financial statements include:
- The timing and amounts of acquisitions and disposals of property, plant and equipment may affect gains/losses and amortization expense.
- Implementation of new collective agreements.
- Further changes to the operating budget through additional new initiatives or technical adjustments later in the year.
Once the Report on Plans and priorities is presented, the Veterans Review and Appeal Board will not be updating the forecasts for any changes to appropriations or forecast financial information made in ensuing supplementary estimates. Variances will be explained in the Departmental Performance Report.
4. Summary of Significant Accounting Policies
The future-oriented statement of operations has been prepared using Government's accounting policies that came into effect for the 2014-15 fiscal year which are 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) Forecasted expenses are recorded on an accrual basis:
- Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
- Services provided without charge by other government departments for accommodations, the employer's contribution to the health and dental insurance plans, legal services and workers' compensation are recorded as operating expenses at their estimated cost.
(b) Measurement uncertainty
The preparation of the future-oriented financial information requires management to make estimates and assumptions that affect the reported amounts of all the assets, liabilities, revenues and expenses reported in the future-oriented financial statements. Assumptions are based upon information available and known to management at the time of development; reflect current business and economic conditions, a continuation of current governmental priorities, and consistency in departmental mandate and strategic objectives. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. Nonetheless, as with all such estimates and assumptions, there is a measure of uncertainty surrounding them. This uncertainty increases as the forecast horizon extends.
5. Parliamentary Authorities
The Veterans Review and Appeal Board is funded by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to the department do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based 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, the Veterans Review and Appeal Board 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) Authorities requested
| Category | Estimated 2015 | Planned 2016 |
|---|---|---|
| (in thousands of dollars) | ||
| Authorities requested | ||
| Program expenditures | 9,979 | 9,461 |
| Statutory amounts | 1,410 | 1,436 |
| 11,389 | 10,897 | |
| Less: | ||
| Estimated lapse - Operating | (389) | 0 |
| Forecast authorities available | 11,000 | 10,897 |
Authorities presented reflect current forecast of statutory items, and program expenditures.
(b) Reconciliation of net cost of operations to requested authorities
| Estimated 2015 | Planned 2016 | |
|---|---|---|
| (in thousands of dollars) | ||
| Net cost of operations | 12,343 | 12,299 |
| Adjustments for items affecting net cost of operations but not affecting appropriations: | ||
| Add (Less): | ||
| Services provided without charge | (1,366) | (1,402) |
| Decrease in employee severance benefits | 23 | 0 |
| Amortization of tangible capital assets | 0 | 0 |
| Total | 11,000 | 10,897 |
| Adjustment for items not affecting net cost of operations but affecting appropriations: | ||
| Add (Less): | ||
| Acquisition of tangible capital assets | 0 | 0 |
| Total | 0 | 0 |
| Requested authorities | 11,000 | 10,897 |
6. Related party transactions
The Veterans Review and Appeal Board has related party transactions as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. Veterans Review and Appeal Board enters into transactions with these entities in the normal course of business and on normal trade terms. Also, during the year, the Veterans Review and Appeal Board 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 Veterans Review and Appeal Board received services without charge from other departments, including accommodations, legal fees and the employer's contribution to health and dental insurance plans. These services without charge have been recognized on the department's Statement of Operations as follows:
| Category | Estimated Results 2015 | Planned Results 2016 |
|---|---|---|
| (in thousands of dollars) | ||
| Accommodations | 657 | 658 |
| Employer's contribution to the health and dental insurance plans | 709 | 744 |
| Legal services | 0 | 0 |
| Workers Compensation | 0 | 0 |
| Total | 1,366 | 1,402 |
The Government has structured some of its administrative services for efficiency and cost-effectiveness purposes so 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 and audit services provided by the Office of the Auditor General, are not included as an expense in the Veterans Review and Appeal Boards' Statement of Operations.