Section 9—Loans, investments and advances

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Loans, investments and advances

Loans, investments and advances is a category of financial claims represented by debt instruments and ownership interests held by the Government of Canada acquired through the use of parliamentary appropriations, except for the portion of the investment balances representing adjustments for the equity of enterprise Crown corporations and other government business enterprises. Some of these appropriations permit repayments to be used for further loans and advances. Details of the use of non-budgetary appropriations, for loans, investments and advances, can be found in the ministerial sections of Volume II.

The investment in enterprise Crown corporations and other government business enterprises is accounted for under the modified equity method and is carried at cost which is adjusted for the annual profits or losses of the enterprises and reduced by any dividends paid by the corporations to the Government. Under the modified equity method, the accounting policies of the enterprise Crown corporations and other government business enterprises are not adjusted to conform to the Government's accounting policies. The Government also reports any amounts receivable from or payable to these corporations and where the Government has advanced funds to the corporations to support their direct lending activities, the amounts are recorded as loans and advances by the Government.

Other loans, investments and advances are initially recorded at cost and are subject to annual valuation to reflect reductions from the recorded value to the approximate net recoverable value. Foreign currency transactions are translated and recorded in Canadian dollar equivalents at the exchange rates prevailing at the transaction dates. Balances of loans, investments and advances resulting from foreign currency transactions are reported at year-end closing rates of exchange; net gains and losses related to these sovereign loans are presented with the return on investments from these loans under other program revenues.

The allowance established to reflect reductions from the recorded value to the approximate net recoverable value of financial claims held by the Government has been authorized by the Minister of Finance and the President of the Treasury Board, under subsection 63(2) of the Financial Administration Act.

Revenues received during the year on loans, investments and advances, are credited to other revenues; details are provided in Section 3 of this volume and in Section 10 of Volume III.

Table 9.1 presents the transactions and year-end balances of loans, investments and advances by category.

Some tables in this section present the continuity of accounts, by showing the opening and closing balances, as well as payments and other charges and receipts and other credits. A narrative description is provided for accounts reported in some tables. Such descriptions follow the same presentation order as their respective tables.

Table summary

The table presents, in dollars, the transactions and year-end balances of loans, investments and advances by category. It consists of five columns: a detailed listing of components; April 1 of the current year; Payments and other charges; Receipts and other credits; March 31 of the current year. The first six rows present the loans, investments and advances by category, followed by a subtotal. The subsequent row presents the allowance for valuation. A final row presents the total for this table.

Table 9.1
Loans, investments and advances
(in dollars)
  April 1, 2015 Payments and other charges Receipts and other credits March 31, 2016
Enterprise Crown corporations and other government business enterprises, Table 9.2 89,374,816,914 59,428,431,837 57,687,566,809 91,115,681,942
Portfolio investments, Table 9.11 78,204,351 – 4,608,891 73,595,460
National governments including developing countries, Table 9.12 987,937,466 39,297,354 61,223,245 966,011,575
International organizations, Table 9.13 20,189,000,296 993,719,122 21,372,123 21,161,347,295
Provincial and territorial governments, Table 9.14 1,112,139,912 73,629,000 766,736,822 419,032,090
Other loans, investments and advances, Table 9.15 28,245,810,702 6,641,943,082 5,290,576,094 29,597,177,690
Subtotal 139,987,909,641 67,177,020,395 63,832,083,984 143,332,846,052
Less: allowance for valuation 26,306,691,248 1,646,629,023 577,043,483 27,376,276,788
Total 113,681,218,393 65,530,391,372 63,255,040,501 115,956,569,264

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