Financial Statements 2020–21

Statement of Management Responsibility Including Internal Control Over Financial Reporting

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2021 and all information contained in these financial statements rests with the management of the Office of the Commissioner of Official Languages (OCOL). These financial statements have been prepared by management using the Government of Canada's accounting policies, which are based on Canadian public sector accounting standards.

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 OCOL’s financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in OCOL’s Departmental Results Report, is consistent with these financial statements.

Management is also responsible for maintaining an effective system of internal control over financial reporting (ICFR) 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 OCOL and through conducting an annual risk-based assessment of the effectiveness of the system of ICFR.

The system of ICFR is designed to mitigate risks to a reasonable level based on an ongoing process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

A risk-based assessment of the system of ICFR for the year ended March 31, 2021 was completed in accordance with the Treasury Board Policy on Financial Management and the results and action plans are summarized in the annex in the 2020-21 Departmental Results Report.

The effectiveness and adequacy of OCOL's system of internal control is reviewed by the work of internal audit staff, who conduct periodic audits of different areas of OCOL's operations, and by the Audit and Evaluation Committee, which oversees management's responsibilities for maintaining adequate control systems and the quality of financial reporting, and which recommends the financial statements for approval to the Commissioner.

The Auditor General of Canada, the independent auditor for the Government of Canada, has expressed an opinion on the fair presentation of OCOL's financial statements, which does not include an audit opinion on the annual assessment of the effectiveness of OCOL's internal controls over financial reporting.

The original version was signed by:
Raymond Théberge
Commissioner of Official Languages

The original version was signed by:
Éric Trépanier, CPA, CGA
Chief Financial Officer
Assistant Commissioner, Corporate Management

 

Gatineau, Canada
July 28, 2021

Independent Auditor’s Report

To the Speaker of the House of Commons and the Speaker of the Senate

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of the Office of the Commissioner of Official Languages (the OCOL), which comprise the statement of financial position as at 31 March 2021, and the statement of operations and net financial position, statement of change in net debt and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the OCOL as at 31 March 2021, and the results of its operations, changes in its net debt, and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the OCOL in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the OCOL’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the OCOL or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the OCOL’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

  • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
  • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the OCOL’s internal control.
  • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
  • Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the OCOL’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the OCOL to cease to continue as a going concern.
  • Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Report on Compliance with Specified Authorities

Opinion

In conjunction with the audit of the financial statements, we have audited transactions of the Office of the Commissioner of Official Languages coming to our notice for compliance with specified authorities. The specified authorities against which compliance was audited are the Financial Administration Act and regulations, and the Official Languages Act.

In our opinion, the transactions of the Office of the Commissioner of Official Languages that came to our notice during the audit of the financial statements have complied, in all material respects, with the specified authorities referred to above.

Responsibilities of Management for Compliance with Specified Authorities

Management is responsible for the Office of the Commissioner of Official Languages’ compliance with the specified authorities named above, and for such internal control as management determines is necessary to enable the Office of the Commissioner of Official Languages to comply with the specified authorities.

Auditor’s Responsibilities for the Audit of Compliance with Specified Authorities

Our audit responsibilities include planning and performing procedures to provide an audit opinion and reporting on whether the transactions coming to our notice during the audit of the financial statements are in compliance with the specified authorities referred to above.

The original version was signed by:
Nathalie Chartrand, CPA, CA
Principal for the Auditor General of Canada

 

28 July 2021
Ottawa, Canada

Financial Statements

Statement of Financial Position As at March 31 (in dollars)

  2021 2020
Liabilities: Accounts payable and accrued liabilities (note 4) 1,724,779 2,317,893
Liabilities: Vacation pay and compensatory leave 1,413,451 1,104,083
Liabilities: Employee future benefits (note 5) 193,841 188,011
Total liabilities 3,332,071 3,609,987
Financial assets: Due from the Consolidated Revenue Fund 1,586,450 1,725,940
Financial assets: Accounts receivable and advances (note 6) 186,364 606,541
Total financial assets 1,772,814 2,332,481
Net debt 1,559,257 1,277,506
Non-financial assets: Prepaid expenses 45,408 61,152
Non-financial assets: Tangible capital assets (note 7) 1,548,517 1,911,674
Total non-financial assets 1,593,925 1,972,826
Net financial position 34,668 695,320

Contractual obligations (note 8)

The accompanying notes form an integral part of these financial statements.

The original version was signed by:
Raymond Théberge
Commissioner of Official Languages

The original version was signed by:
Éric Trépanier, CPA, CGA
Chief Financial Officer
Assistant Commissioner, Corporate Management

 

Gatineau, Canada
July 28, 2021

Statement of Operations and Net Financial Position For the Year Ended March 31 (in dollars)

  Planned results (note 2a)
2021
2021 2020
Expenses: Protection of rights related to official languages 8,957,933 9,083,553 8,859,010
Expenses: Advancement of English and French in Canadian society 8,244,166 8,091,916 8,076,938
Expenses: Internal Services 7,742,918 9,648,270 8,316,356
Net cost of operations before government funding 24,945,017 26,823,739 25,252,304
Government funding: Net cash provided by Government of Canada 21,585,476 22,863,208 22,641,301
Government funding: Change in due from Consolidated Revenue Fund (58,185) (139,490) (968,390)
Government funding: Services provided without charge from common service organizations (note 9) 3,174,889 3,404,995 3,276,111
Government funding: Transfer of accounts receivables from other government departments - 34,374 231
Net cost (revenue) of operations after government funding 242,837 660,652 303,051
Net financial position - Beginning of year 974,029 695,320 998,371
Net financial position - End of year 731,192 34,668 695,320

Segmented information (note 10)

The accompanying notes form an integral part of these financial statements.

 

Statement of Change in Net Debt For the Year Ended March 31 (in dollars)

  Planned results (note 2a)
2021
2021 2020
Net cost (revenue) of operations after government funding 242,837 660,652 303,051
Change due to tangible capital assets: Acquisition of tangible capital assets (note 7) 157,989 27,266 287,286
Change due to tangible capital assets: Amortization of tangible capital assets (note 7) (455,709) (390,423) (337,980)
Total change due to tangible capital assets (297,720) (363,157) (50,694)
Change due to prepaid expenses (15,559) (15,744) (100,522)
Net increase (decrease) in net debt (70,442) 281,751 151,835
Net debt - Beginning of year 1,191,794 1,277,506 1,125,671
Net debt - End of year 1,121,352 1,559,257 1,277,506

The accompanying notes form an integral part of these financial statements.

 

Statement of Cash Flows For the Year Ended March 31 (in dollars)

Operating activities 2021 2020
Net cost of operation before government funding 26,823,739 25,252,304
Non-cash items: Amortization of tangible capital assets (note 7) (390,423) (337,980)
Non-cash items: Services provided without charge from common service organizations (note 9) (3,404,995) (3,276,111)
Non-cash items: Transfer of accounts receivable from other government departments (34,374) (231)
Variations in Statement of Financial Position: Increase (decrease) in accounts receivable and advances (420,177) 332,527
Variations in Statement of Financial Position: Decrease in prepaid expenses (15,744) (100,522)
Variations in Statement of Financial Position: Decrease in accounts payable and accrued liabilities (note 4, 7) 548,616 401,024
Variations in Statement of Financial Position: Increase in vacation pay and compensatory leave (309,368) (193,459)
Variations in Statement of Financial Position: Decrease (increase) in employee future benefits (5,830) 17,783
Cash used in operating activities 22,791,444 22,095,335
Capital investing activities: Acquisition of tangible capital assets (note 7) 71,764 545,966
Cash used in capital investing activities 71,764 545,966
Net cash provided by Government of Canada 22,863,208 22,641,301

The accompanying notes form an integral part of these financial statements.

 

Notes to the Financial Statements For the Year Ended March 31

1. Authority and objectives

The Parliament of Canada adopted the first Official Languages Act in 1969. This Act provides that "English and French would henceforth have equality of status and equal rights and privileges as to their use in all the institutions of the Parliament and Government of Canada”.

Under the Act, therefore, the Commissioner of Official Languages is required to take every measure within his power to ensure that the three main objectives of the Official Languages Act are met:

  • the equality of the status and use of English and French in Parliament, the Government of Canada, the federal administration and the institutions subject to the Act;
  • the development of official language communities in Canada; and
  • the advancement of the equality of English and French in Canadian society.

The Commissioner of Official Languages is appointed by commission under the Great Seal, after approval by resolution of the House of Commons and the Senate, for a seven-year term. The Commissioner of Official Languages reports directly to Parliament.

The Office of the Commissioner of Official Languages (OCOL), which serves the public from its offices in Gatineau and its five regional offices, supports the Commissioner of Official Languages in fulfilling his mandate.

OCOL has three programs which are described below:

Through the Protection of rights related to official languages program, OCOL takes the appropriate steps, including complaints processing, audits and interventions, to ensure compliance with the Official Languages Act and language rights in Canada.

Through the Advancement of English and French in Canadian society program, OCOL raises awareness of issues related to the advancement of the equal status of English and French in federal institutions and Canadian society, while supporting the development and vitality of Official Language Minority Communities.

The Internal Services program involves those groups of related activities and resources that the federal government considers to be services in support of programs and/or required to meet corporate obligations of an organization. Internal Services refers to the activities and resources of the 10 distinct service categories that support Program delivery in the organization, regardless of the Internal Services delivery model in an organization. The 10 service categories are Management and Oversight Services, Communications Services, Legal Services, Human Resources Management Services, Financial Management Services, Information Management Services, Information Technology Services, Real Property Services, Materiel Services and Acquisition Services.

Since legal remedies are set out in the Act, the Office of the Commissioner of Official Languages’ Legal Services are excluded from its Internal Services and are an integral part of its Protection of rights related to official languages program. As well, given their specific mandate, its Communications Services are not included in Internal Services, but rather form part of its Advancement of English and French in Canadian society program.

OCOL is named in Schedule I.1 of the Financial Administration Act (FAA) and is funded through annual parliamentary authorities.

2. Summary of significant accounting policies

These financial statements are prepared using the Government of Canada's accounting policies stated below, 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) Parliamentary authorities

OCOL is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to OCOL do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Consequently, items recognized in the Statement of Operations and Net Financial Position and in the Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament. Note 3 provides a reconciliation between the bases of reporting. The planned results amounts in the “Expenses” section of the Statement of Operations and Net Financial Position are the amounts reported in the Future-oriented Statement of Operations included in the 2020-21 Departmental Plan. The planned results amounts in the “Government funding” section of the Statement of Operations and Net Financial Position and in the Statement of Change in Net Debt were prepared for internal management purposes and have not been previously published.

Liquidity risk is the risk that OCOL will encounter difficulty in meeting its obligations associated with financial liabilities. OCOL’s objective for managing liquidity risk is to manage operations and cash expenditures within the appropriation authorized by Parliament or allotment limits approved by the Treasury Board.

Each year, OCOL presents information on planned expenditures to Parliament through the tabling of Estimates publications. These estimates result in the introduction of supply bills (which, once passed into legislation, become appropriation acts) in accordance with the reporting cycle for government expenditures. OCOL exercises expenditure initiation processes such that unencumbered balances of budget allotments and appropriations are monitored and reported on a regular basis to help ensure sufficient authority remains for the entire period and appropriations are not exceeded.

Consistent with Section 32 of the Financial Administration Act, OCOL’s policy to manage liquidity risk is that no contract or other arrangement providing for a payment shall be entered into with respect to any program for which there is an appropriation by Parliament or an item included in estimates then before the House of Commons to which the payment will be charged unless there is a sufficient unencumbered balance available out of the appropriation or item to discharge any debt that, under the contract or other arrangement, will be incurred during the fiscal year in which the contract or other arrangement is entered into.

OCOL’s risk exposure and its objectives, policies and processes to manage and measure this risk did not change significantly from the prior year.

(b) Net cash provided by Government

OCOL operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by OCOL is deposited to the CRF, and all cash disbursements made by OCOL are paid from the CRF. The net cash provided by Government of Canada is the difference between all cash receipts and all cash disbursements, including transactions between departments of the Government of Canada.

(c) Due from the Consolidated Revenue Fund (CRF)

Amounts due from the CRF are the result of timing differences at year-end between when a transaction affects authorities and when it is processed through the CRF. Amounts due from the CRF represent the net amount of cash that OCOL is entitled to draw from the CRF without further authorities to discharge its liabilities.

(d) Expenses

Expenses are recorded on the accrual basis. Vacation pay and compensatory leave are accrued as the benefits are earned by employees under their respective terms of employment.

(e) Employee future benefits

  1. Pension benefits: Eligible employees participate in the Public Service Pension Plan (Plan), a multiemployer pension plan administered by the Government of Canada. OCOL’s contributions to the Plan are charged to expenses in the year incurred and represent the total obligation to the Plan. OCOL’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.
  2. Severance benefits: The accumulation of severance benefits for voluntary departures ceased for applicable employee groups. Due to the size of OCOL, the remaining obligation for employees who did not withdraw benefits is calculated using employee specific information.

(f) Accounts receivable

Accounts receivable are stated at the lower of cost and net recoverable value. A valuation allowance is recorded for accounts receivable where recovery is considered uncertain.

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. OCOL is not exposed to significant credit risk. OCOL provides services to other government departments and agencies and to external parties in the normal course of business. Accounts receivable are due on demand. The majority of accounts receivable are due from other Government of Canada departments and agencies where there is minimal potential risk of loss. The maximum exposure OCOL has to credit risk equal to the carrying value of its accounts receivable.

(g) Contingent liabilities

Contingent liabilities are potential liabilities, which may become actual liabilities when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, a provision is accrued and an expense recorded to other expenses. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.

(h) Tangible capital assets

All tangible capital assets are recorded at their acquisition cost. OCOL does not capitalize intangible assets.

Amortization of capital assets is done on a straight-line basis as follows:

Asset Class Amortization Period
Equipment and material 5 years
Informatics hardware 4 years
Furniture 5 years
Informatics software 3 years
Motor vehicles 7 years
Leasehold improvements Lesser of the remaining term of the lease or the useful life of the improvement

Assets under construction are recorded in the applicable capital asset class in the year they become available for use and are not amortized until they become available for use.

 

(i) Related party transactions

Inter-entity transactions

OCOL is related, in terms of common ownership, to all government departments, agencies, and Crown corporations. OCOL enters into transactions with these entities in the normal course of business, which are measured at the carrying amount, except for the following:

  1. Inter-entity transactions are measured at the exchange amount when undertaken on similar terms and conditions to those adopted if the entities where dealing at arm’s length, or where costs provided are recovered.
  2. Goods or services received without charge between commonly controlled entities, when used in the normal course of the operations and would otherwise have been purchased, are recorded as revenues and expenses at their carrying amount.
Other related party transactions

Related parties also include key management personnel (KMP) having authority and responsibility for planning, directing and controlling the activities of OCOL, as well as their close family members. OCOL has defined its KMP to be the Commissioner, Assistant Commissioners, and General Counsel.

These related party transactions are recorded at the exchange amount.

(j) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported and disclosed amounts of assets, liabilities and expenses reported in the financial statements and accompanying notes at March 31. The estimates are based on facts and circumstances, historical experience, general economic conditions and reflect OCOL's best estimate of the related amount at the end of the reporting period. The most significant items where estimates are used are the liability for vacation pay and compensatory leave, employee future benefits 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.

3. Parliamentary authorities

OCOL receives its funding through annual parliamentary authorities. Items recognized in the Statement of Operations and Net Financial Position and the Statement of Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, OCOL has different net results of operations for the year on a government funding basis than on an accrual accounting basis. The differences are reconciled in the following tables:

(a) Reconciliation of net cost of operations to current year authorities used
(in dollars)
  2021 2020
Net cost of operations before government funding 26,823,739 25,252,304
Adjustments for items affecting net cost of operations but not affecting authorities:
Services provided without charge from common service organizations (note 9)
(3,404,995) (3,276,111)
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets (note 7)
(390,423) (337,980)
Adjustments for items affecting net cost of operations but not affecting authorities:
Increase in vacation pay and compensatory leave
(309,368) (193,459)
Adjustments for items affecting net cost of operations but not affecting authorities:
Expenditures not charged to authorities
(65,500) -
Adjustments for items affecting net cost of operations but not affecting authorities:
Decrease (increase) in employee future benefits
(5,830) 17,783
Adjustments for items affecting net cost of operations but not affecting authorities:
Other
3,939 (18,061)
Total items affecting net cost of operations but not affecting authorities (4,172,177) (3,807,828)
Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisitions of tangible capital assets (note 7)
27,266 287,286
Adjustments for items not affecting net cost of operations but affecting authorities:
Decrease in prepaid expenses
(15,744) (100,522)
Total items not affecting net cost of operations but affecting authorities 11,522 186,764
Current year authorities used 22,663,084 21,631,240
 
(b) Reconciliation of authorities provided and used
(in dollars)
  2021 2020
Authorities provided: Vote 1 – Program expenditures 21,663,707 20,459,164
Authorities provided: Statutory – Contributions to employee benefit plans 2,510,639 2,182,990
Authorities provided: Statutory – Proceeds from the disposal of surplus Crown assets 75 34
Total authorities provided 24,174,421 22,642,188
Less: Lapsed: Operating (1,511,296) (1,010,914)
Less: Authorities available for future years (41) (34)
Current year authorities used 22,663,084 21,631,240
 

4. Accounts payable and accrued liabilities

Accounts payable and accrued liabilities are measured at cost, the majority of which are due within three months of year-end.

The following table presents details of OCOL's accounts payable and accrued liabilities:

Accounts payable and accrued liabilities (in dollars)
  2021 2020
Other government departments and organizations 383,027 299,855
External parties 2,361 549,509
Total accounts payable 385,388 849,364
Accrued liabilities 1,339,391 1,468,529
Total accounts payable and accrued liabilities 1,724,779 2,317,893
 

5. Employee future benefits

(a) Pension benefits

OCOL’s employees participate in the Public Service Pension Plan (the ''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 2 percent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Québec Pension Plan benefits and they are indexed to inflation.

Both the employees and OCOL contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to Economic Action Plan 2012, employee contributors have been divided into two groups – Group 1 related to existing plan members as of December 31, 2012 and Group 2 relates to members joining the Plan as of January 1, 2013. Each group has a distinct contribution rate.

The 2020-21 expense amounts to $1,713,260 ($1,512,375 in 2019-20). For Group 1 members, the expense represents approximately 1.01 times (1.01 times in 2019-20) the employee contributions and, for Group 2 members, approximately 1.00 time (1.00 time in 2019-20) the employee contributions.

OCOL’s responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the Consolidated Financial Statements of the Government of Canada, as the Plan’s sponsor.

(b) Severance benefits

Severance benefits provided to OCOL's employees were previously based on an employee's eligibility, years of service and salary at termination of employment. However, since 2011 the accumulation of severance benefits for voluntary departures progressively ceased for substantially all employees. Employees subject to these changes were given the option to be paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits upon departure from the public service. As at March 31, 2021, substantially all settlements for immediate cash out were completed and the remaining obligation will be disbursed upon departure from the public service. Severance benefits are unfunded and, consequently, the outstanding obligation will be paid from future authorities.

The changes in the obligation during the year are as follows:

Severance benefits (in dollars)
  2021 2020
Accrued benefit obligation - Beginning of year 188,011 205,794
Expense for the year 14,327 795
Benefits paid during the year (8,497) (18,578)
Accrued benefit obligation - End of year 193,841 188,011
 

6. Accounts receivable and advances

The following table presents details of OCOL's accounts receivable and advances balances:

Accounts receivable and advances (in dollars)
  2021 2020
Receivables - Other government departments and agencies 105,066 502,598
Employee advances and overpayments 81,298 103,943
Total accounts receivable and advances 186,364 606,541
 

7. Tangible capital assets

Cost
(in dollars)
  Opening Balance Acquisitions Disposals and Write-Offs and Transfers Closing Balance
Equipment and material 560,718 - (3,778) 556,940
Informatics hardware 593,831 - - 593,831
Furniture 481,794 20,757 - 502,551
Informatics software 211,541 - (7,850) 203,691
Motor vehicles 30,557 - - 30,557
Leasehold improvements 2,212,407 - - 2,212,407
Assets under construction - 6,509 - 6,509
Total Cost 4,090,848 27,266 (11,628) 4,106,486
Accumulated Amortization
(in dollars)
  Opening Balance Amortization Disposals and Write-Offs and Transfers Closing Balance
Equipment and material 370,879 52,774 (3,778) 419,875
Informatics hardware 459,186 55,070 - 514,256
Furniture 350,227 30,734 - 380,961
Informatics software 211,541 - (7,850) 203,691
Motor vehicles 9,094 4,366 - 13,460
Leasehold improvements 778,247 247,479 - 1,025,726
Total Accumulated Amortization 2,179,174 390,423 (11,628) 2,557,969
Net Book Value
(in dollars)
  Opening Balance Closing Balance
Equipment and material 189,839 137,065
Informatics hardware 134,645 79,575
Furniture 131,567 121,590
Informatics software - -
Motor vehicles 21,463 17,097
Leasehold improvements 1,434,160 1,186,681
Assets under construction - 6,509
Total Net Book Value 1,911,674 1,548,517

The "Acquisition of tangible capital assets” and the “Decrease in accounts payables and accrued liabilities” presented in the Statement of Cash Flows include an amount of $71,764 in relation to the acquisition of tangible capital assets, as the amount relates to capital investing activities in 2019-20 that were paid in 2020-21 and excludes an amount of $27,266 as the amount relates to capital investing activities in 2020-21 that remain to be paid as at March 31, 2021.

8. Contractual obligations

The nature of OCOL’s activities may result in some large multi-year contracts and obligations whereby OCOL will be obligated to make future payments when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:

Contractual obligations (in dollars)
  2021-22 2022-23 2023-24 2024-25 2025-26
Total contractual obligations 147,603 133,045 120,398 97,009 135,339
 

9. Related party transactions

(a) Services provided without charge from common service organizations

During the year, OCOL received services without charge from common service organizations and these services have been recorded in OCOL’s Statement of Operations and Net Financial Position as follows:

Services provided without charge from common service organizations (in dollars)
  2021 2020
Accommodation 1,682,588 1,697,200
Employer's contribution to the health and dental insurance plans 1,502,407 1,410,911
Audit services 220,000 168,000
Total 3,404,995 3,276,111
 

(b) Other transactions with related parties

OCOL incurred expenses from transactions in the normal course of business with other government departments, agencies and Crown corporations. These expenses exclude services received without charge, which are already disclosed in section a). Other transactions with related parties are summarized below :

Other transactions with related parties (in dollars)
  2021 2020
Accounts receivable 105,066 502,598
Accounts payable 375,613 290,093
Expenses 3,415,406 3,269,363
Tangible capital assets 6,509 159,322
 

10. Segmented information

Presentation by segment is based on OCOL's program alignment architecture. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in note 2. The following table presents the expenses incurred for the programs, by major object of expenses. The segment results for the period are as follows:

Segmented information (in dollars)
Expenses Protection of rights related to official languages Advancement of English and French in Canadian society Internal Services Total
2021
Total
2020
Salaries and employee benefits 7,993,891 6,680,565 6,746,520 21,420,976 18,955,558
Professional and special services 290,513 692,873 1,439,010 2,422,396 2,240,153
Accommodation 617,779 514,716 550,093 1,682,588 1,697,200
Amortization of tangible capital assets 143,348 119,433 127,642 390,423 337,980
Equipment and supplies 29,998 9,958 300,743 340,699 865,004
Rentals 321 157 206,119 206,597 267,006
Transportation and telecommunications 4,617 28,245 171,072 203,934 605,285
Repairs, maintenance and others 3,002 13 104,619 107,634 141,372
Communications and printing 84 45,956 2,452 48,492 142,746
Total expenses 9,083,553 8,091,916 9,648,270 26,823,739 25,252,304

Annex to the Statement of Management Responsibility Including Internal Control over Financial Reporting (ICFR) (unaudited); for the year ended March 31, 2021

1. Introduction

This document provides summary information on the measures taken by the Office of the Commissioner of Official Languages (OCOL) to maintain an effective system of internal control over financial reporting (ICFR), including information on internal control management, assessment results and related action plans.

Detailed information on OCOL’s authority, mandate and program activities can be found in the 2020-2021 Departmental Results Report and the 2021-2022 Departmental Plan.

Due to the COVID-19 pandemic, an assessment of OCOL’s overall control environment was performed in 2020-2021, and it was determined that none of the key controls were compromised as a result of the pandemic.

Although operations continued remotely in 2020-2021 due to the COVID pandemic, financial transactions continued to be approved by the appropriate authority and no changes were required to OCOL’s delegation instruments.

There were no changes required to the risk assessment done at the beginning of the COVID-19 pandemic. The risk related to the key controls continue to be low and therefore there is no impact on the validity, accuracy and completeness of OCOL’s Financial Statements, including the Notes.

2. Organisational System of Internal Control over Financial Reporting

2.1 Internal Control Management

OCOL has a well-established governance and accountability structure to support organizational assessment efforts and oversight of its system of internal control. An organizational internal control management framework, approved by the Commissioner, is in place and includes:

  • Organizational accountability structures as they relate to internal control management to support sound financial management, including roles and responsibilities of senior managers in their areas of responsibility for control management;
  • Values and ethics;
  • Ongoing communication and training on statutory requirements, and policies and procedures for sound financial management and control; and
  • Monitoring of and regular updates on internal control management, as well as the provision of related assessment results and action plans to the Commissioner and organizational senior management and, as applicable, OCOL’s Audit and Evaluation Committee (AEC).

The AEC provides advice to the Commissioner on the adequacy and functioning of OCOL’s risk management, control and governance frameworks and processes.

2.2 Service Arrangements Relevant to Financial Statements

OCOL relies on other organizations for the processing of certain transactions that are recorded in its financial statements as follows:

Common Arrangements
  • Public Services and Procurement Canada (PSPC) centrally administers:
    • the procurement of goods and services in accordance with OCOL’s Delegation of Authority; and
    • provides accommodation services;
  • Treasury Board of Canada Secretariat provides information used to calculate various accruals and allowances;
  • Public Service Commission provides OCOL with language evaluation services;
  • The Office of the Auditor General provides audit services; and
  • Shared Services Canada provides information technology infrastructure services to OCOL in the areas of internet connectivity and email security.
Specific Arrangements
  • PSPC provided OCOL with:
    • a financial system platform, the Common Departmental Financial System (CDFS), to capture and report all financial transactions until March 31, 2021.  Effective April 1, 2021, OCOL is using the SAP financial and materiel management system; and
    • translation services;
  • OCOL and the other tenants at 30 Victoria Street, Gatineau, have entered into a Memorandum of Understanding (MOU) for base building security and multi tenant responsibilitiesFootnote 1; and
  • The Canada School of Public Service provides OCOL with some training servicesFootnote 1.

3. Organizational Assessment Results During Fiscal Year 2020-2021

Due to the COVID-19 pandemic, an assessment of OCOL’s overall control environment was performed in 2020-2021, and it was determined that none of the key controls were compromised as a result of the pandemic. Senior management concluded that the risk related to these key controls was low.

As of April 1, 2021, OCOL started using TBS’s SAP financial and materiel management system. TBS is hosting OCOL on their SAP interface as is the case with several other government departments. Prior to OCOL’s transition to SAP, an independent third-party review of TBS’s general internal control environment was completed, in order to provide OCOL with assurance regarding TBS’s internal controls. An extensive documentation review was conducted on available governance instruments and work procedures. The review found no issues with TBS’s general internal control environment.  In addition, TBS will provide OCOL with an annual statement on the effectiveness of the SAP internal control environment. TBS is required to supply this statement to partners as a service provider.

A review of the TBS directives on ICFM was also done in 2020-2021 to determine the impacts of these directives on the organisation. As a result, OCOL’s internal control plan for future years was updated to reflect new ICFM activities beginning in 2021-2022.

4. Organizational Action Plan

4.1 Progress During Fiscal Year 2020-2021

During 2020-2021, OCOL continued to make significant progress in assessing and improving its key controls. The following table summarizes OCOL’s progress based on the plans identified in the previous fiscal year’s annex.

Elements in previous year’s action plan Status
Salaries / Pay administration Remediation of deficiencies were completed.
Procurement to Payment Remediation of deficiencies advanced significantly (only one outstanding recommendation).
Capital Assets Remediation of deficiencies were completed.

4.2 Status and Action Plan for the Next Fiscal Year and Subsequent Years

Following OCOL’s transition to the SAP financial and materiel management system on April 1, 2021, key control areas will be reviewed and changes to business processes and internal controls will be documented as indicated in OCOL’s action plan.

The status and action plan for the completion of the identified control areas for the next fiscal year and for subsequent years are shown in the following table.

Ongoing Monitoring Activities for the Next 4 Years
Key Control Areas 2021-2022 2022-2023 2023-2024 2024-2025
Internal Controls Over Financial Management:  
Salaries / Pay Administration X      
Forecasting   X    
Planning and Budgeting (including Investment Planning)     X  
Internal Controls Over Financial Reporting:  
Information Technology General Controls X      
Entity-Level Controls     X  
Procurement to Payment X X    
Financial Close and Reporting   X    
Journal Entry Framework X      
Capital Assets X X    
Travel, Hospitality, Conference and Event Expenditures (THCEE)       X
Delegation of Signing and Financial Authority X      
Date modified:
2022-02-01