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Treasury Board of Canada Secretariat
Financial Statements (Unaudited)
For the Year Ended March 31, 2010

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, 2010, and all information contained in these statements rests with the management of the Treasury Board Secretariat. 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.

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 Secretariat's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada and included in the Secretariat'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 Secretariat, 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 attached 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 assess key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

The system of internal control is augmented by Internal Audit, which conducts periodic audits and reviews of different areas of the Secretariat's operations. In addition, the Chief Audit Executive has free access to the Audit Committee, which provides advice on management's responsibilities for maintaining adequate control systems and the quality of financial reporting. The Committee undertakes a review of the financial statements, including all significant accounting estimates and judgments therein, and advises the Secretariat on any apparent material concerns.

The financial statements of the Treasury Board of Canada Secretariat have not been audited.

 

 

 

Treasury Board of Canada Secretariat
Statement of Operations (Unaudited)
For the year ended March 31
($ thousands)

	2010 Planned Results	2010	2009
Expenses (Note 4)
Government-Wide Funds and Public Service Employer Payments	2,112,764	2,067,613	1,743,227
Management Policy Development  and Oversight	126,179	159,056	120,253
Expenditure Management and Financial  Oversight	41,856	40,054	37,009
Internal Services	72,660	100,863	71,110
Total Expenses	2,353,459	2,367,586	1,971,599
Revenues (Note 5)
Government-Wide Funds and Public Service  Employer Payments	11,762	11,667	11,697
Management Policy Development  and Oversight	4,879	4,772	4,036
Expenditure Management and Financial  Oversight	-	-	-
Internal Services	-	8	20
Total Revenues	16,641	16,447	15,753
Net Cost of Operations	2,336,818	2,351,139	1,955,846

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

Treasury Board of Canada Secretariat
Statement of Financial Position (Unaudited)
At March 31
($ thousands)

	2010	2009
Assets
Financial assets
Accounts receivable and advances (Note 6)	659,454	230,049
Non-financial assets
Prepaid expenses	64	-
Tangible capital assets (Note 7)	14,722	13,126
Total Assets	674,240	243,175
Liabilities
Accounts payable and accrued liabilities (Note 8)	566,775	439,214
Vacation pay and compensatory leave	10,137	6,547
Employee severance benefits (Note 9)	36,126	28,888
	613,038	474,649
Equity of Canada	61,202	(231,474)
Total Liabilities and Equity	674,240	243,175
Contingent liabilities (Note 10) Contractual obligations (Note 11)

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

Treasury Board of Canada Secretariat
Statement of Equity of Canada (Unaudited)
At March 31
($ thousands)

	2010	2009
Equity of Canada, beginning of year	(231,474)	(356,265)
Net cost of operations	(2,351,139)	(1,955,846)
Current year appropriations used (Note 3)	2,341,557	1,959,625
Revenue not available for spending	(12,534)	(12,571)
Change in net position in the Consolidated Revenue Fund  (Note 3)	311,070	116,365
Services received without charge from other government  departments (Note 12)	23,839	17,218
Transferred from Public Service Human Resource Management  Agency of Canada, effective April 1, 2009 (note 13)	(20,117)	-
Equity of Canada, end of year	61,202	(231,474)

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

Treasury Board of Canada Secretariat
Statement of Cash Flow (Unaudited)
For the year ended March 31
($ thousands)

	2010	2009
Operating activities
Net cost of operations	2,351,139	1,955,846
Non-cash items:
Amortization of tangible capital assets	(3,341)	(1,225)
Gain on disposal of tangible capital asset	1	7
Services received without charge from other  government departments	(23,839)	(17,218)
Variations in Statement of Financial Position:
Increase in accounts receivable and advances	429,405	126,865
(Decrease) increase in prepaid expenses	64	(36)
(Decrease) increase in accounts payable and  accrued liabilities	(127,561)	2,291
(Increase) in vacation pay and compensatory leave	(3,590)	(470)
(Increase) in employee severance benefits	(7,238)	(5,185)
Transferred from Public Service Human Resource  Management Agency of Canada, effective April 1, 2009 (note 13)	20,117	-
Cash used by operating activities	2,635,157	2,060,875
Capital investment activities
Acquisition of tangible capital assets	1,263	2,551
Transfer of capital assets from Department of Finance and Public Service Human Resource Management Agency of Canada	3,687	-
Proceeds from disposition of tangible capital assets	(14)	(7)
Cash used by capital investment activities	4,936	2,544
Total Operating and Capital Investment Activities	2,640,093	2,063,419
Net cash provided by the Government of Canada	(2,640,093)	(2,063,419)

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

1. Authority and Objectives

Under the broad authority of sections 5 to 13 of the Financial Administration Act, the Secretariat supports the Treasury Board as a committee of ministers in its role as the general manager and employer of the public administration. It is headed by a Secretary, who reports to the President of the Treasury Board.

The mission of the Secretariat is to ensure that the rigorous stewardship of public resources achieves results for Canadians.

The core business of the Secretariat is currently organized into four programs. Therefore, figures for 2008-2009 in the Statement of Operations are redistributed for comparison purposes.

The Program activities are described as follow:

a) Government-Wide Funds and Public Service Employer Payments

Primarily payments and receipts made on behalf of other government departments for the employer's share of Public Service Pension Plan and group insurance obligations.

B) Management Policy Development and Oversight

The Secretariat provides support to the Treasury Board in its role as management board. This includes the promotion of improved management performance and the development of policies that support the prudent and effective management of the government's assets and its human, financial, information, and technology resources.

c) Expenditure Management and Financial Oversight

The Secretariat's role is to provide advice and recommendations to Treasury Board on the allocation and reallocation of resources to ensure that they are aligned with the government's priorities and responsibilities and that federal programs are effective, efficient, and provide value for money.

d) Internal Services

The Internal Services program activity includes the following key functions and costs that support Treasury Board and the internal management of the Secretariat: Minister's office operations, senior departmental management, strategic planning, communications, legal services, finances, human resources, accommodation, security, information management and information technology support, as well as some centrally administered services (e.g. translation).

2. Summary of Significant Accounting Policies

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 Secretariat is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the Secretariat 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 to these financial statements provides a high-level reconciliation between the bases of reporting.

b) Net cash provided by the Government of Canada

The Secretariat operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the Secretariat is deposited to the CRF and all cash disbursements made by the Secretariat are paid from the CRF. The net cash provided by 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 CRF is the difference between net cash provided by the Government and appropriations used in a year, excluding the amount of non-respendable revenue recorded by the Secretariat. It results from timing differences between when a transaction affects appropriations and when it is processed through the CRF.

d) Revenues

Revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.

e) Expenses

Expenses are recorded on the accrual basis:

• Contributions are recognized in the year in which the recipient has met the eligibility criteria or fulfilled the terms of a contractual transfer agreement.
• Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
• Services received without charge from other government departments for accommodation and legal services are recorded as operating expenses at their estimated cost.

f) Government-wide employee benefits

Eligible public service employees participate in the Public Service Pension Plan sponsored by the Government of Canada. Contributions to the Plan for all departments and agencies, including additional contributions in respect of any actuarial deficiencies, are funded by the Secretariat as centrally managed funds, and they are expensed in the year incurred. The Secretariat recovers a portion of the pension contributions from other departments and agencies.

The Government of Canada also sponsors a variety of other benefit plans that the Secretariat is responsible to administer and or fund through its centrally managed funds. These benefits are recognized to expenses when they become due. A portion of these benefits is also recovered from other departments and agencies.

For the pension benefits and other future employee benefits covered by these plans, actuarially determined liabilities and related disclosure are presented in the financial statements of the Government of Canada, the ultimate sponsor of these benefits. As administrator of the centrally managed funds, the Secretariat expenses these benefits or contributions as they become due and records no accruals for future benefits. This accounting treatment corresponds to the funding provided to the department through Parliamentary appropriations.

g) Departmental employee future benefits

Pension benefits: Eligible employees of the Secretariat participate in the Public Service Pension Plan. The Secretariat's share of contributions pertaining to the current service cost of its employees is allocated to the expenses of the program activities of Expenditure Management and Financial Oversight, Management Policy Development and Oversight, and in Internal Services in the year incurred.

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 of the Secretariat is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government of Canada as a whole.

h) Accounts receivable and advances

Accounts receivable and advances are stated at amounts expected to be ultimately realized.

i) 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.

j) Tangible capital assets

All tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. The Secretariat does not capitalize intangibles, works of art, and historical treasures that have cultural, aesthetic, or historical value.

Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset as follows:

Asset class	Amortization period
Machinery and equipment	3 to 10 years
Motor vehicles	3 years
Leasehold improvements	Lesser of the remaining term of the lease or useful life of the improvement
Assets under construction	Once in service, in accordance with asset class

k) 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, the liability for employee severance 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 Appropriations

The Secretariat receives most of its funding through annual 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 a prior, current or future year. Accordingly, the Secretariat 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 appropriations used

	2010	2009
	($ thousands)
Net cost of operations	2,351,139	1,955,846
Adjustments for items affecting net cost of operations but not affecting appropriations: Add (Less):
Services received without charge from other   government departments	(23,839)	(17,218)
Revenue not available for spending	12,534	12,571
(Increase) in vacation pay and compensatory leave	(3,590)	(470)
(Increase) in employee severance benefits	(7,238)	(5,185)
Amortization of tangible capital assets	(3,341)	(1,225)
Other	14,038	13,169
	(11,436)	1,642
Adjustments for items not affecting net cost of operations but affecting appropriations: Add (Less):
Acquisitions of tangible capital assets	1,263	2,551
Advances	591	(414)
	1,854	2,137
Current year appropriations used	2,341,557	1,959,625

b) Appropriations provided and used

	2010	2009
	($ thousands)
Appropriations provided
Vote 1 — Program expenditures	263,987	196,337
Vote 5 — Government contingencies	712,117	651,565
Vote 10 — Government-Wide initiatives	7,511	7,141
Vote 15 — Compensation adjustments	-	1
Vote 20 — Public service insurance	2,164,302	1,862,944
Vote 25 — Operating budget carry forward	481,554	113,426
Vote 30 — Pay list Requirements	4,543	-
Vote 35 — Budget implementation initiatives	883,489	-
	4,517,503	2,831,414
Statutory authorities:
Contributions to employee benefit plans	31,286	20,835
Unallocated employer contributions made under the Public  Service Superannuation Act and other retirement acts, and  the Employment Insurance Act	6,471	9,481
Payments for the pay equity settlement pursuant to section  30 of the Crown Liability and Proceedings Act	(517)	(972)
President of the Treasury Board - salary and car allowance	78	77
Other statutory authorities	24	20
	37,342	29,441
Less:
Lapsed authorities:
Vote 1 — Program expenditures	(21,901)	(12,129)
Vote 5 — Government contingencies	(712,117)	(651,565)
Vote 10 — Government-Wide initiatives	(7,511)	(7,141)
Vote 15 — Compensation adjustments	-	(1)
Vote 20 — Public service insurance	(102,152)	(116,951)
Vote 25 — Operating budget carry forward	(481,554)	(113,426)
Vote 30 — Pay list Requirements	(4,543)	-
Vote 35 —  Budget implementation initiatives	(883,489)	-
Spending of proceeds from the disposal of surplus crown assets	(21)	(17)
	(2,213,288)	(901,230)
Current year appropriations used	2,341,557	1,959,625

c) Reconciliation of net cash provided by Government to current year appropriations used

	2010	2009
	($ thousands)
Net cash provided by the Government of Canada	2,640,093	2,063,419
Revenue not available for spending	12,534	12,571
Change in net position in the Consolidated Revenue Fund:
(Increase) in accounts receivable and advances	(429,405)	(126,865)
(Decrease) increase in prepaid expenses	(64)	36
(Decrease) increase in accounts payable and accrued liabilities	127,561	(2,291)
Increase in vacation pay and compensatory leave	3,590	470
Transferred from Public Service Human Resource Management Agency of Canada, effective April 1, 2009 (note 13)	(20,117)	-
Other	7,365	12,285
	(311,070)	(116,365)
Current year appropriations used	2,341,557	1,959,625

4. Expenses

a) The following table presents details of expenses by category:

	2010	2009
	($ thousands)
Transfer payments	220	228
Operating expenses:
Centrally Managed Funds (Note 4b)	2,067,613	1,743,227
Departmental salaries and employee benefits	212,981	160,983
Professional and special services	47,675	39,519
Accommodation	19,263	13,523
Transportation and telecommunications	5,795	5,064
Machinery and equipment	4,698	3,257
Utilities, materials and supplies	1,921	1,524
Rentals	1,312	969
Information	1,033	733
Repairs and maintenance	1,354	342
Amortization	3,341	1,225
Other	380	1,005
Total operating expenses	2,367,366	1,971,371
Total Expenses including Transfer Payments	2,367,586	1,971,599

b) Public Service Human Resource Management Agency of Canada Merger

As identified in Note 13, the Public Service Human Resource Management Agency of Canada (Canada Public Service Agency) was merged with Treasury Board Secretariat effective April 1, 2009. The expenses for the Treasury Board Secretariat for 2008-09 were not restated to reflect the merged department. A substantial portion of the increase in operating expenses for the Treasury Board of Canada Secretariat from 2008-09 to 2009-10, apart from centrally managed funds, is related to the merger.

c) Centrally Managed Funds

The Government of Canada sponsors defined benefit pension plans covering most of its employees. The Secretariat funds the employer's contributions to the Public Service Pension Plan and Retirement Compensation Arrangement, including additional contributions in respect of actuarial deficiencies.

The Secretariat also funds payments to or in respect of:

• the employer's share of contributions to the Public Service Death Benefit Account;
• the employer's share of Canada/Quebec Pension Plan contributions and Employment Insurance premiums;
• the employer's share of health, disability, and life insurance premiums and related Quebec sales tax;
• the employer's share of the Quebec Parental Insurance Plan premium;
• claims and related costs under the Public Service Dental Care Plan and the Pensioners' Dental Services Plan;
• provincial payroll taxes;
• pension, benefit, and insurance plans for employees engaged locally outside Canada by Canadian missions abroad; and
• returns to certain employees of their share of the Employment Insurance premium reduction.

Generally, Public Service Pension Plan contributions, Public Service Death Benefit Account contributions, Canada/Quebec Pension Plan contributions, and Employment Insurance premiums are recovered from all departments, agencies, and revolving funds pro-rata, based on salaries and wages incurred. Contributions to health care plans are recovered from certain departments and agencies, and all revolving funds based on 8.5 per cent (8.0 per cent in 2009) of salaries and wages incurred.

A breakdown by major category is as follows:

	2010	2009
	($ thousands)
Expenses
Public Service Pension Plan and Retirement Compensation  Arrangement contributions (Statutory)	2,687,405	2,323,497
Public Service Health Care Plan (Vote 20)	909,815	790,469
Canada/Quebec Pension Plan contributions (Statutory)	666,590	590,851
Provincial payroll taxes (Vote 20)	524,764	464,549
Group disability and life insurance (Vote 20)	472,401	355,677
Employment Insurance premiums (Statutory)	274,641	248,404
Public Service Dental Care Plan (Vote 20)	269,608	227,128
Pensioners' Dental Services Plan (Vote 20)	122,031	110,840
Pension and other government employee benefits in  respect of locally engaged staff employed in Canadian  missions abroad (Vote 20)	50,330	47,384
Provincial Health Insurance Plan premiums (Vote 20)	31,068	35,626
Quebec Parental Insurance Plan premiums (Vote 20)	32,333	27,307
Public Service Death Benefit Account contributions (Statutory)	11,582	10,430
Public Service Pension Plan and Retirement Compensation  Arrangement contributions in respect of actuarial deficits  (Statutory)	6,200	9,500
Operating expenses (Vote 20)	5,584	5,566
Pension and similar payments to former government employees  (Vote 20 & Statutory)	3,297	2,689
Employment Insurance premium reduction (Vote 20)	1,749	1,341
Miscellaneous special payments (Statutory)	(517)	(972)
Total Expenses	6,068,881	5,250,286
Recoveries
Employer's contributions to government employee benefit  plans recovered from government departments and agencies  (Statutory)	3,639,946	3,173,201
Employer's contributions to government employee insurance  plans recovered from government departments and agencies  (Vote 20)	177,942	156,180
Employee's contributions to Public Service Health Care Plan  recovered from government departments and other organizations  (Vote 20)	132,159	129,256
Pensioners' contributions to the Pensioners' Dental Services Plan  (Vote 20)	51,221	48,422
Total Recoveries	4,001,268	3,507,059
Net Expenses	2,067,613	1,743,227

5. Revenues

The following table presents details of revenues by category:

	2010	2009
	($ thousands)
Parking fees	11,595	11,643
Recovery of pension administration costs	4,772	4,036
Other	80	74
Total Revenues	16,447	15,753

6. Accounts Receivable and Advances

The following table presents details of accounts receivable and advances:

	2010	2009
	($ thousands)
Receivables from other Federal Government departments and agencies	657,819	229,142
Advances to external parties	1,054	564
Receivables from external parties	473	271
Advances to employees	105	60
Deposits in transit to the Receiver General	3	12
Total Accounts Receivable and Advances	659,454	230,049

7. Tangible Capital Assets

The following table presents the details of Tangible Capital Assets:

Amortization expense for the year ended March 31, 2010, is $3,341, thousand ($1,225 thousand in 2009).

The Transfer of Assets columns take into account all assets and related amortization as a result of the merger with the Public Service Human Resource Management Agency of Canada and the transfer from Department of Finance (Note 13).

($ thousands)	Cost
Capital asset class	Opening balance	Transfer Assets (note 13)	Acqui-sitions	Disposals & write-offs	Closing balance
Machinery and  equipment	15,084	8,816	1,227	(104)	25,023
Motor vehicles	102	59	36	(72)	125
Leasehold  improvements	1,952	-	-	-	1,952
Assets under  construction	-	-	-	-	-
Total	17,138	8,875	1,263	(176)	27,100

($ thousands)	Accumulated amortization
Capital asset class	Opening balance	Transfer Assets (note 13)	Amorti-zation	Disposals & write-offs	Closing balance
Machinery and  equipment	2,005	5,158	3,307	(96)	10,374
Motor vehicles	55	30	34	(67)	52
Leasehold  improvements	1,952	-	-	-	1,952
Assets under  construction	-	-	-	-	-
Total	4,012	5,188	3,341	(163)	12,378

($ thousands)	Net book value
Capital asset class	2010	2009
Machinery and equipment	14,649	13,079
Motor vehicles	73	47
Leasehold improve-ments	-	-
Assets under construction	-	-
Total	14,722	13,126

8. Accounts payable and accrued liabilities

The following table presents the details of accounts payable and accrued liabilities:

	2010	2009
	($ thousands)
Accounts payable to other government departments and agencies	321,929	254,804
Accounts payable to external parties	244,846	184,410
Total accounts payable and accrued liabilities	566,775	439,214

9. Employee Benefits

a) Pension benefits

Eligible public service 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 2 per cent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with the Canada/Québec Pension Plans benefits and they are indexed to inflation.

The Secretariat funds the employer contributions to the Public Service Pension Plan, including additional contributions in respect of actuarial deficiencies, on behalf of all government departments and agencies, and recovers a portion of those costs.

During the year, the Secretariat contributed $22,589 thousand ($15,043 thousand in 2009) in respect of its own employees, which represents approximately 1.9 times (2.0 times in 2009) the contributions made by its employees.

b) Severance benefits

The Secretariat 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. The liability for severance for 2009-2010 is determined using a Government-Wide estimate of 23.27% (compared to 26.92% in 2008-2009) and applying it to the Secretariat annual gross payroll related to indeterminate employees. Information about the severance benefits, measured as at March 31, is as follows:

	2010	2009
	($ thousands)
Accrued benefit obligation, beginning of year	28,888	23,703
Expense for the year	1,070	7,149
Benefits paid during the year	(3,935)	(1,964)
Transferred from other government department,  effective April 1, 2009 (note 13)	10,103	-
Accrued benefit obligation, end of year	36,126	28,888

10. Contingent liabilities

Claims and Litigations

Claims have been made against the Secretariat in the normal course of operations. Legal proceedings for claims totaling approximately $67 billion ($62 billion in 2009) were still pending at March 31, 2010. Some of these potential liabilities 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 on the financial statements. No accrual for these contingent liabilities has been made in the financial statements.

The most significant of these legal actions is described as follows:

In September 1999, the Public Sector Pension Investment Board Act (Bill C-78) was passed by Parliament, providing for improvements in the financial management of federal public service pension plans, including the Public Service (PSSA), RCMP (RCMPSA), and Canadian Forces (CFSA) superannuation plans. The new Act authorized the President of the Treasury Board to debit the accounts in order to reduce the amount of certain excess balances in the superannuation accounts. In late 1999, the major public service unions and pensioner associations launched three lawsuits against the Crown challenging the validity of the legislation. On November 20, 2007, the plaintiffs' actions were dismissed. In February 2008, all 3 plaintiffs appealed the decisions. The appeal was heard on April 19, 20 and 21, 2010. A decision is pending.

11. Contractual Obligations

The nature of the Secretariat's activities can result in some large multi-year contracts and obligations whereby the Secretariat 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:

	2011	2012	2013	2014	2015 and there-after	Total
	($ thousands)
Public Service Health/Dental Plans	33,381	34,134	24,644	26,494	28,777	147,430
Other professional services	5,491	1,514				7,005
Management consulting	1,718					1,718
Protection services	2,107					2,107
Computer services	1,160					1,160
Total	43,857	35,648	24,644	26,494	28,777	159,420

12. Related-party transactions

Services received without charge

The Secretariat is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. The Secretariat enters into transactions with these entities in the normal course of business and on normal trade terms.

Also, during the year, the Secretariat received without charge services from other departments as shown in the following table:

	2010	2009
	($ thousands)
Accommodation	19,263	13,523
Legal services	4,576	3,695
Total	23,839	17,218

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 departments 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 Statement of Operations.

13. Transfer from other government department

a) Order in Council P.C. 2009-0181 approved the amalgamation of the Public Service Human Resources Management Agency of Canada (Canada Public Service Agency) with the Treasury Board Secretariat, effective March 2, 2009.  The financial impact of this merger on assets, liabilities and equity has been reported effective April 1, 2009 and the following assets and liabilities have been transferred from the Public Service Human Resources Management Agency of Canada to the Treasury Board Secretariat:

	2010
	($ thousands)
Assets
Accounts receivable and advances	2,438
Tangible capital assets	76
	2,514
Liabilities
Accounts payables and accrued liabilities	9,670
Vacation pay and compensatory leave	2,858
Employee severance benefits	10,103
	22,631
Adjustment to Equity of Canada	(20,117)

b) Order in Council P.C. 2009-0112 approved the transfer from the Department of Finance to the Treasury Board of Canada Secretariat of the control and the supervision of portions of the federal public administration related to shared corporate services in the Department of Finance, effective February 1, 2009. Assets of a net book value of $3,611 thousand have been transferred from the Department of Finance to the Treasury Board Secretariat in 2009-2010.

14. Comparative information

Comparative figures have been reclassified to conform to the current year's changed program activity presentation.

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