2011-2012 Consolidated Departmental Financial Statements

Table of Contents

• Statement of Management Responsibility including Internal Control over Financial reporting
• Consolidated Statement of Financial Position
• Consolidated Statement of Operations and Departmental Net Financial Position
• Consolidated Statement of Change in Departmental Net Debt
• Consolidated Statement of Cash Flow
• Notes to the Consolidated Financial Statements
  1. Authority and Objectives
  2. Summary of Significant Accounting Policies
  3. Parliamentary Authorities
  4. Accounts Payable and Accrued Liabilities
  5. Other Liabilities
  6. Lease Obligations for Tangible Capital Assets
  7. Employee Future Benefits
  8. Contingent and Environmental Liabilities
  9. Accounts Receivable and Advances
  10. Inventory
  11. Tangible Capital Assets
  12. Departmental Net Financial Position
  13. Contractual Obligations
  14. Related party transactions
  15. Transferred and Discontinued Operations
  16. Segmented Information
  17. Restatement
  18. Comparative Information
• Annex A – Assessment of Internal Control over Financial Reporting

Statement of Management Responsibility including Internal Control over Financial reporting

Responsibility for the integrity and objectivity of the accompanying consolidated departmental financial statements for the year ended March 31, 2012, and all information contained in these statements rests with Public Works and Government Services Canada (PWGSC) management. These consolidated departmental financial statements have been prepared by management using the Government’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 consolidated departmental financial statements. Some of the information in the consolidated departmental 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 PWGSC's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada and included in PWGSC's Departmental Performance Report is consistent with these consolidated departmental 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 Department; and through conducting an annual risk-based assessment of the effectiveness of the system of internal control over financial

The system of internal control over financial reporting is designed to mitigate risks to a reasonable level based on an on-going process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

For the year ended March 31, 2012, a risk-based assessment of the system of internal control over financial reporting was completed in accordance with the Treasury Board Policy on Internal Control and the results and action plans are summarized in Annex A – Assessment of Internal Control over Financial Reporting.

The effectiveness and adequacy of the Department's system of internal control is reviewed by internal audit staff, who conduct periodic audits of different areas of the Department's operations.

The Department’s Audit and Evaluation Committee have reviewed these consolidated departmental financial statements for the purpose of advising the Deputy Minister on any apparent material concerns. The role of this committee is to provide the Deputy Minister of PWGSC with objective advice and recommendations regarding the sufficiency, quality and results of assurance on the adequacy and functioning of the Department's risk management, control, and governance frameworks and processes. The Committee also provides advice on the oversight of core areas of departmental management, control and accountability, including financial reporting.

The consolidated departmental financial statements of PWGSC have not been audited.

François Guimont, Deputy Minister
Gatineau, Canada
August 28, 2012

Alex Lakroni, Chief Financial Officer
Gatineau, Canada
August 23, 2012

Consolidated Statement of Financial Position (Unaudited )
As at March 31

(in thousands of dollars)	2012	2011 Restated (Note 17)
Liabilities
Accounts payable and accrued liabilities (Note 4)	770,706	859,649
Vacation pay and compensatory leave	51,202	54,398
Other liabilities (Note 5)	85,241	76,353
Lease obligations for tangible capital assets (Note 6)	2,277,140	2,279,073
Lease inducements	35,516	40,534
Employee future benefits (Note 7)	139,334	232,701
Contingent and environmental liabilities (Note 8)	336,750	337,390
	3,695,889	3,880,098
Total net liabilities	3,695,889	3,880,098
Financial assets
Due from Consolidated Revenue Fund	123,947	515,156
Accounts receivable and advances (Note 9)	704,139	456,999
Seized Property Working Capital Account	(1,282)	8,369
	826,804	980,524
Financial assets held on behalf of Government
Accounts receivable and advances (Note 9)	(23,790)	(17,305)
Seized Property Working Capital Account	1,282	(8,369)
	(22,508)	(25,674)
Total net financial assets	804,296	954,850
Departmental net debt	2,891,593	2,925,248
Non-financial assets
Prepaid expenses	3,786	4,145
Inventory (Note 10)	3,970	4,915
Tangible capital assets (Note 11)	5,479,264	5,243,147
	5,487,020	5,252,207
Departmental net financial position (Note 12)	2,595,427	2,326,959

Contractual obligations (Note 13)
The accompanying notes form an integral part of these consolidated financial statements.

François Guimont, Deputy Minister
Gatineau, Canada
August 28, 2012

Alex Lakroni, Chief Financial Officer
Gatineau, Canada
August 23, 2012

Consolidated Statement of Operations and Departmental Net Financial Position (Unaudited)
For the year ended March 31

(in thousands of dollars)	2012 Planned results	2012	2011 Restated (Note 17)
Expenses
Accommodation and Real Property Assets Management	3,602,405	3,781,687	3,905,357
Internal Services	309,093	520,534	439,318
Acquisitions	288,854	354,916	268,916
Linguistic Management and Services	247,536	203,401	228,410
Receiver General for Canada	132,068	142,940	134,653
Federal Pay and Pension Administration	104,292	128,988	99,081
Specialized Programs and Services	94,751	76,780	166,823
Procurement Ombudsman	4,295	3,712	3,269
Expenses incurred on behalf of Government		(30,919)	(53,650)
	4,783,294	5,182,039	5,192,177
Revenues
Sales of goods and information products		1,282,367	1,489,126
Rentals		863,477	806,169
Services of a non-regulatory nature		380,716	347,612
Services of a regulatory nature		149,897	149,650
Other revenues		47,426	66,525
Revenue from Seized Property Proceeds Account (Note 12)		28,685	28,675
Revenues earned on behalf of Government		(92,993)	(109,353)
	2,479,824	2,659,575	2,778,404
Net cost from continuing operations	2,303,470	2,522,464	2,413,773
Transferred and discontinued operations (Note 15)
Expenses	476,723	123,045	454,517
Revenues	(347,729)	(116,272)	(312,031)
	128,993	6,773	142,486
Net cost of operations before government funding and transfers	2,432,463	2,529,237	2,556,259
Government funding and transfers
Net cash provided by Government of Canada	2,727,171	3,126,481	3,008,536
Change in due from Consolidated Revenue Fund		(391,209)	44,343
Services provided without charge by other government departments (Note 14)	60,218	66,568	67,118
Transfer of assets and liabilities from (to) other government departments (Note 14)		2,745	(17,459)
Transfer of assets and liabilities from (to) other government departments as a result of a reorganization (Note 15)		(6,880)	-
Net cost of operations after government funding and transfers	(354,925)	(268,468)	(546,279)
Departmental net financial position - beginning of year	2,383,160	2,326,959	1,780,680
Departmental net financial position - End of year	2,738,085	2,595,427	2,326,959

Segmented information (Note 16)
The accompanying notes form an integral part of these consolidated financial statements.

Consolidated Statement of Change in Departmental Net Debt (Unaudited)
For the year ended March 31

(in thousands of dollars)	2012 Planned results	2012	2011 Restated (Note 17)
Net Cost of Operations after government funding and transfers	(354,925)	(268,468)	(546,279)
Change Due to Tangible Capital Assets
Acquisitions of tangible capital assets (Note 11)	600,390	641,323	827,446
Acquisitions of leased tangible capital assets (Note 11)		197,967	103,979
Amortization of tangible capital assets (Note 11)	(513,350)	(472,262)	(456,982)
Proceeds from disposal of tangible capital assets		-	(107)
Net (loss) or gain on disposals / Adjustments of tangible capital assets		(96,145)	10,496
Transfers to other government departments (Note 15)		(34,766)	-
Change Due to Tangible Capital Assets	87,040	236,117	484,832
Change Due to Prepaid Expenses		(359)	(689)
Change Due to Inventory		(945)	(622)
Net Increase (decrease) in departmental net debt	(267,885)	(33,655)	(62,758)
Departmental Net Debt - Beginning of year		2,925,248	2,988,006
Departmental Net Debt - End of year	(267,885)	2,891,593	2,925,248

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

Consolidated Statement of Cash Flow (Unaudited)
For the year ended March 31

(in thousands of dollars)	2012	2011 Restated (note 17)
Operating activities
Net cost of operations before government funding and transfers	2,529,237	2,556,259
Non cash items:
Amortization of tangible capital assets (Note 11)	(472,262)	(456,982)
Gain (loss) on disposals / Adjustments of tangible capital assets	(98,491)	28,970
Services provided without charge by other government departments (Note 14)	(66,568)	(67,118)
Variations in Consolidated Statement of Financial Position:
Increase (decrease) in accounts receivable and advances	240,655	(34,119)
Increase (decrease) in Seized Property Working Capital Account	-	-
Increase (decrease) in prepaid expenses	(359)	(689)
Increase (decrease) in inventory	(945)	(622)
Decrease (increase) in accounts payable and accrued liabilities	88,943	(91,695)
Decrease (increase) in other liabilities	(8,888)	15,802
Decrease (increase) in vacation pay and compensatory leave	3,196	360
Decrease (increase) in employee future benefits	93,367	(19,658)
Decrease (increase) in contingent and environmental liabilities	640	30,480
Decrease (increase) in lease inducements	5,018	1,679
Transfer of liabilities to other government departments (Note 15)	(27,915)	-
Cash used by operating activities	2,285,628	1,962,667
Capital investing activities
Acquisitions of tangible capital assets (Note 11)	641,323	827,446
Acquisitions of assets under construction for capital leases (Note 11)	43,317	49,442
Proceeds on disposal of tangible capital assets	-	(107)
Cash used by capital investing activities	684,640	876,781
Financing activities
Payments on lease obligations for tangible capital assets	156,213	169,088
Cash used by financing activities	156,213	169,088
Net cash provided by Government of Canada	3,126,481	3,008,536

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

Notes to the Consolidated Financial Statements (Unaudited)
For the year ended March 31

1. Authority and Objectives

The department of Public Works and Government Services Canada (PWGSC) was established effective June 20, 1996, under the Department of Public Works and Government Services Act. This legislation specifies that PWGSC shall provide common, central and shared services to other government departments and agencies, thereby enabling them to provide programs and services to Canadians. These services are delivered through the following program activities:

• Accommodation and Real Property Assets Management program activity provides federal departments and agencies with safe, healthy and affordable office and common use accommodation that support the effective delivery of their programs and services. It acts as steward for various public works such as buildings, bridges and dams, and national treasures such as the Parliamentary Precinct and other heritage assets across Canada. PWGSC also provides other federal departments and agencies with responsive and cost-effective real property services;
• Information Technology Infrastructure Services program activity provides leadership in supporting government-wide IT transformation initiatives. It works closely with client federal organizations to understand and respond to their IT requirements, while delivering secure IT services and solutions. It includes the brokering, developing and/or managing of products and services for distributed computing environments, data centres, telecommunications and information technology security;
• Internal Services are groups of related activities such as Human Resources, Finance, Legal, and resources that are administered to support the needs of programs and other corporate obligations of an organization. Internal Services include only those activities and resources that apply across an organization and not those provided specifically to a program;
• Acquisitions program activity identifies PWGSC as the government’s primary procurement service provider, offering federal organizations a broad base of procurement solutions such as specialized contracts, standing offers and supply arrangements. The role of PWGSC in this area is to provide timely value-added acquisitions and related common services to Canadians and the federal government;
• Linguistic Management and Services program activity identifies the Translation Bureau, a key component of the federal government’s service delivery infrastructure. The Translation Bureau is the sole internal linguistic services provider and offers translation, revision, interpretation and other linguistic services for Parliament, the judiciary, and federal departments and agencies. It is also the terminology authority within the federal government and has been mandated to develop terminology standards to ensure clear, uniform and quality communications within government. Moreover, it ensures that there is a sustainable, qualified and secure supply of linguistic resources available to support any linguistic requirements of the government and to support Canada’s economic and social agenda. This program is mandated under the Translation Bureau Act;
• Specialized Programs and Services program activity ensures high quality, timely and accessible specialized services and programs to federal institutions in support of sound, prudent and ethical management and operations. It includes activities such as the Industrial Security Program, Greening of Government Operations, Government Information Services, Government Consulting Services (terminated), Audit Services Canada (terminated) and Shared Services Integration;
• Receiver General for Canada program activity manages the operations of the federal treasury and maintains the Accounts of Canada. It provides federal departments with optional financial management systems, bill payment services and document imaging;
• Federal Pay and Pension Administration program activity provides reliable central systems and processes for pay and pension administration to other federal organizations and ensures that federal government employees and pensioners are paid accurately and on time. Through this activity, PWGSC provides payroll services for 110 departments, separate employers and other federal organizations, and administers the pension accounts for approximately 231,900 former public servants, 111,400 former members of the Canadian Forces and 1,375 former Members of Parliament and judges;
• Procurement Ombudsman program activity, operating at arm's length from the government, reviews procurement practices across federal departments and agencies, investigates complaints from potential suppliers with respect to awards of contracts for goods and services below certain thresholds as well as complaints concerning the administration of contracts; and ensures the provision of an alternative dispute resolution program for contracts. This activity helps to promote fairness and transparency in the procurement process.

2. Summary of Significant Accounting Policies

These consolidated financial statements have been prepared using the Government'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

PWGSC is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to PWGSC does not parallel financial reporting according to Canadian generally accepted accounting principles since authorities are primarily based on cash flow requirements. Consequently, items recognized in the Consolidated Statement of Operations and Departmental Net Financial Position and in the Consolidated Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament. Note 3 provides a high-level reconciliation between the two bases of reporting.

B. Consolidation

These consolidated financial statements include the accounts of seven revolving funds as listed below, one of them being inactive. Six revolving funds prepare a complete set of financial statements annually that are audited and published in the Public Accounts of Canada. The accounts of these revolving funds have been consolidated with those of PWGSC and intradepartmental balances and transactions have been eliminated.

The PWGSC revolving funds are as follows:

• Consulting and Audit Canada Revolving Fund (terminated March 31, 2012)
• Defence Production Revolving Fund (inactive)
• Optional Services Revolving Fund
• Real Property Disposition Revolving Fund
• Real Property Services Revolving Fund
• Telecommunications and Informatics Common Services Revolving Fund (transferred to Shared Services Canada August 4, 2011)
• Translation Bureau Revolving Fund

C. Planned Results

The planned results are those presented in the 2011-2012 Future Oriented Financial Statements (FOFS) that were included into the 2011-2012 Report on Plans and Priorities (RPP). The major assumptions related to these planned results are mentioned in the 2011-2012 FOFS. A reclassification has been done in order to re-align the planned results with the actual results presented in accordance with the new version of the Treasury Board Accounting Standards 1.2 - 2011-2012.

D. Net Cash Provided By Government

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

E. Amounts Due From The Consolidated Revenue Fund (CRF)

These 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 the Department is entitled to draw from the CRF, without further authorities, in order to discharge its liabilities.

F. Revenues

Revenues are presented on an accrual basis:

• Revenues from regulatory fees are recognized in the accounts based on the services provided in the year.
• Other revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.
• Revenues that are non-respendable are not available to discharge the Department's liabilities. While the Deputy Minister of PWGSC is expected to maintain accounting control, he has no authority regarding the disposition of non-respendable revenues. As a result, non-respendable revenues are considered to be earned on behalf of the Government of Canada and are therefore presented in reduction of the entity's gross revenues.

G. Expenses

Expenses are recorded on the accrual basis of accounting:

• Transfer payments are recorded as expenses when authorization for the payment exists and the recipient has met the eligibility criteria or the entitlements established for the transfer payment program. In situations where payments do not form part of an existing program, transfer payments are recorded as expenses when the Government announces a decision to make a non- recurring transfer, provided the enabling legislation or authorization for payment receives parliamentary approval prior to the completion of the financial statements. Transfer payments that become repayable as a result of conditions specified in the contribution agreement that have come into being are recorded as a reduction to transfer payment expense and as a receivable.
• Services provided without charge by other government departments for the employer's contribution to the health and dental insurance plans, worker's compensation and legal services are recorded as operating expenses at their estimated cost.
• Vacation pay and compensatory leave are accrued as the benefits are earned by employees under their respective terms of employment.
• Generally, PWGSC does not provide grants and contributions to individuals or organizations to fund specific programs and services. PWGSC administers the Payments in Lieu of Taxes Program (PILT) on behalf of all federal departments under the statutory authority of the Payments in Lieu of Taxes Act , which is disclosed under Grants in the Main Estimates. The Government of Canada voluntarily pays a fair share of the costs of local government, from which it is exempt, to municipalities and other taxation authorities having jurisdiction to levy and collect real property taxes in locations where federal lands and buildings are situated. The PILT issued by PWGSC on behalf of other participating federal departments are recovered from them and are recorded as Grants in the Public Accounts of Canada.

H. Employee Future Benefits

1. Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multiemployer pension plan administered by the Government. The Department’s contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. The Department’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: Employees entitled to severance benefits under labour contracts or conditions of employment earn these benefits as services necessary to earn them are rendered. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.

I. Accounts Receivable and Advances

Accounts receivable and advances are stated at the lower of cost and net recoverable value; a valuation allowance is recorded for receivables where recovery is considered uncertain.

J. Lease Inducements

Lease inducements represent incentives received by PWGSC to enter into a lease. Lease inducements include incentives such as: free rent, cash received to be applied to rent, lump sum cash, leasehold improvements and moving costs paid by the lessor. Lease inducements are accounted for as follows:

• Rent-free periods or periods of significantly reduced rent are allocated over the term of the lease on a straight-line basis;
• Cash payments from the lessor to the lessee are accounted for by the lessee, as reductions in rental expense over the term of the lease;
• Leasehold improvements are amortized over the remaining life of the lease or the useful life of the improvement, whichever is shorter;
• Moving costs absorbed by the lessor are amortized over the term of the lease.

K. 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 consolidated financial statements.

L. Environmental Liabilities

Environmental liabilities reflect the estimated costs related to the management and remediation of environmentally contaminated sites. Based on management's best estimates, a liability is accrued and an expense recorded when the contamination occurs or when the Department becomes aware of the contamination and is obligated, or is likely to be obligated to incur such costs. If the likelihood of the Department's obligation to incur these costs is not determinable, or if an amount cannot be reasonably estimated, the costs are disclosed as contingent liabilities in the notes to the consolidated financial statements.

M. Inventory

• Inventory held for resale consists of physical items that will be sold in the future in the ordinary course of business to parties outside of the government reporting entity. Inventory held for re-sale is measured at the lower of cost and net realizable value;
• Work in process includes direct costs, and recovered costs incurred for sales or transfers of properties not yet finalized at the fiscal year end.

N. Tangible Capital Assets

Tangible capital assets are recorded at their acquisition cost, and the following is the capitalization threshold for tangible capital assets:

• Betterments and leasehold improvements carried out on buildings and on works and infrastructure, having an initial cost of $25,000 or more;
• All other tangible capital assets having an initial cost of $10,000 or more.

The department does not capitalize intangibles and non-operational heritage assets such as: works of art and historical treasures that have cultural, aesthetic or historical value; immovable assets located on Indian Reserves; or museum collections.

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

Asset Class	Amortization period
Buildings	25 years
Works and infrastructure	40 years
Machinery and equipment	3 to 15 years
Informatics hardware and software	3 to 10 years
Vehicles	6 to 20 years
Leasehold improvements	Lesser of the remaining term of the lease or useful life of the improvement
Leased tangible capital assets	In accordance with asset class if ownership is likely to transfer to PWGSC; otherwise, over the lease term

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

O. Measurement Uncertainty

The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the consolidated financial statements. At the time of preparation of these consolidated statements, management believes the estimates and assumptions to be reasonable. The most significant items where estimates are used are the allowance for doubful accounts, contingent liabilities, environmental liabilities, accounts receivable held on behalf of Government, 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 consolidated financial statements in the year they become known.

P. Seized Property Working Capital Account

The Seized Property Working Capital Account was established pursuant to section 12 of the Seized Property Management Act . Expenses incurred, and advances made, to maintain and manage any seized or restrained property and other properties subject to a management order or forfeited to Her Majesty, are charged to this account. The Seized Property Working Capital Account is credited when expenses and advances to third parties are repaid or recovered and when revenues from these properties or proceeds of their disposal are received and credited with seized cash upon forfeiture.

The total amount authorized to be outstanding at any time is $50,000,000.

Any shortfall between the proceeds from the disposition of any property forfeited to Her Majesty and the amounts that were charged to this account and that are still outstanding, is charged to a Seized Property Proceeds Account and credited to this account.

3. Parliamentary Authorities

PWGSC receives most of its funding through annual parliamentary authorities. Items recognized in the Consolidated Statement of Operations and Departmental Net Financial Position and the Consolidated Statement of Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, PWGSC 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 thousands of dollars)	2012	2011 Restated (Note 17)
Net cost of operations before government funding and transfers	2,529,237	2,556,259
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets (Note 11)	(472,262)	(456,982)
Reclassification of assets under construction	(84,060)	(45,974)
Services provided without charge by other government departments (Note 14)	(66,568)	(67,118)
Increase in lease inducements	(2,397)	(6,197)
Decrease (increase) in vacation pay and compensatory leave	3,196	360
Decrease (increase) in employee future benefits (Note 7)	93,367	(19,658)
Refunds / Adjustments to previous years' expenses	17,417	9,894
Decrease (increase) in contingent and environmental liabilities	640	30,480
Other	(80,684)	17,045
	(591,351)	(538,150)
Adjustments for items not affecting net cost of operations but affecting auhorities:
Acquisitions of tangible capital assets (Note 11)	641,321	827,446
Acquisitions of assets under construction for capital leases (Note 11)	43,317	49,442
Payments on lease obligations for tangible capital assets	156,213	169,088
Other	5,122	6,107
	845,973	1,052,083
Current year authorities used	2,783,859	3,070,192

B. Authorities provided and used

(in thousands of dollars)	2012	2011
Vote 1 – Operating expenditures	2,266,031	2,501,985
Vote 1 – Grants & Contributions	5,210	4,900
Vote 5 – Capital expenditures	509,319	689,430
Statutory items:
Revolving Funds	372,112	572,501
Other	116,684	114,960
Authorities provided	3,269,356	3,883,776
Less:
Authorities available for future years	(365,000)	(587,837)
Lapsed authorities	(110,847)	(215,372)
Current year budgetary authorities used	2,793,509	3,080,567
Seized Property Management Act	(9,650)	(10,374)
Current year authorities used	2,783,859	3,070,193

4. Accounts Payable and Accrued Liabilities

The following table presents details of the Department's accounts receivable and advances:

(in thousands of dollars)	2012	2011
Accounts payable	384,367	480,814
Accrued liabilities	191,944	224,747
Accrued salaries and wages	22,138	21,355
Contractors' holdbacks and other payables	47,353	48,483
Accounts payable to other government departments and agencies	46,620	54,010
Public Private Partnership accrued liabilities	78,284	30,240
Total	770,706	859,649

5. Other Liabilities

The following table presents details of other liabilities:

(in thousands of dollars)	2011	Receipts and credits	Payments and charges	2012
Seized property - cash	70,459	36,359	(28,461)	78,357
Deposits on disposals	830	8,102	(7,863)	1,069
Contractors' security	4,127	5,259	(4,516)	4,870
deposits Francophone summits	12	62	(54)	20
Credit card - special project fund	925	-	-	925
Total	76,353	49,782	(40,894)	85,241

Seized property - cash

This account was established pursuant to the Seized Property Management Act, to record seized cash. These funds will be deposited to the Consolidated Revenue Fund and credited to the account until returned to the owner or forfeited.

Deposits on disposals

This account was established in accordance with the terms and conditions of the Real Property Disposition Revolving Fund to record receipts on disposals of properties.

Contractors' security deposits

This account was established to record contractors' securities that are required for the satisfactory performance of work in accordance with the Government Contracts Regulations.

Francophone summits

This account was established to record funding granted since 1994 by the Agence intergouvernementale de la Francophonie (Paris), which changed its name in 2006 to the Organisation internationale de la Francophonie, for projects involving the development of French and partner languages in order to express scientific and technical modernity.

Credit card - special project fund

This account was established to record funds received from American Express (AMEX) to improve the Travel Card Program.

6. Lease Obligations for Tangible Capital Assets

PWGSC has entered into capital lease agreements with a cost of $2,526,604,466 and accumulated amortization of $1,158,486,769 as at March 31, 2012 ($2,387,112,915 and $1,035,526,150 respectively as at March 31, 2011) (Note 11). The obligations for upcoming years consist of the following:

(in thousands of dollars)	Total future minimum lease payments	Weighted average imputed interest rate 5.7% (5.8% in 2011)	2012	2011
Land	11,174	3,444	7,730	8,332
Buildings	3,341,653	1,072,243	2,269,410	2,270,407
Information technology equipment	-	-	-	334
Total	3,352,827	1,075,687	2,277,140	2,279,073

The following table presents the future minimum lease payments:

(in thousands of dollars)	2013	2014	2015	2016	2017 and thereafter
Land	1,382	1,382	1,382	1,382	5,646
Buildings	278,843	305,640	235,047	223,421	2,298,702
Information technology equipment	–	–	–	–	–
Total	280,225	307,022	236,429	224,803	2,304,348

7. Employee Future Benefits

A. Pension Benefits

PWGSC 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 percent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Quebec Pension Plan benefits and they are indexed to inflation.

Both the employees and the department contribute to the cost of the Plan. The 2011-2012 expense amounts to $121,201,756 ($123,313,793 in 2011), which represents approximately 1.8 times (1.9 times in 2011) the contributions by employees.

PWGSC's responsibility with regard to the Plan is limited to its contributions. Actuarial deficiencies are recognized in the consolidated financial statements of the Government of Canada, as the Plan's sponsor.

B. Severance Benefits

The department provides severance benefits to its employees based on eligibility, years of service and salary at termination of employment. These severance benefits are not pre-funded. Benefits will be paid from future authorities and revolving funds.

Commencing in 2012, as part of collective agreement negotiations with certain employee groups, and changes to conditions of employment for executives and certain non-represented employees, the accumulation of severance benefits under the employee severance pay program ceased for these employees. Employees subject to these changes have been given the option to be immediately paid the full or partial value of benefits earned to date or to collect the full or remaining value of benefits on termination from the public service. These changes have been reflected in the calculation of the outstanding severance benefit obligation.

Information about the severance benefits, measured as at March 31 is as follows:

(in thousands of dollars)	2012	2011
Accrued benefit obligation, beginning of year	232,701	213,043
Transferred to Shared Services Canada, effective August 4, 2011 (Note 15)	(22,514)	-
Expense for the year	17,788	44,086
Benefits paid during the year	(88,641)	(24,428)
Accrued benefit obligation, end of year	139,334	232,701

8. Contingent and Environmental Liabilities

Contingent liabilities arise in the normal course of operations and their ultimate disposition is unknown. They are grouped into two categories as follows:

A. Claims and Litigation

Claims have been made against PWGSC in the normal course of operations. These claims include items with pleading amounts and others for which no amount is specified. While the total amount claimed in these actions is significant, their outcomes are not determinable. The department has recorded an allowance amounting to $55,138,210 ($21,225,000 in 2011) for claims and litigations where it is likely that there will be a future payment and a reasonable estimate of the loss can be made. Claims and litigations for which the outcome is not determinable and a reasonable estimate can be made by management amount to approximately $8,874,157 (no amount in 2011) at March 31, 2012.

B. Contaminated Sites

Liabilities are accrued to record the estimated costs related to the management and remediation of contaminated sites where PWGSC is obligated or likely to be obligated to incur such costs. The department has identified approximately 143 sites (168 in 2011) where such action is possible and for which a liability of $281,612,052 ($316,165,045 in 2011) has been recorded in accrued liabilities. Of this amount, $128,478,851 ($173,575,932 in 2011) is related to environmental remediation activity for the Sydney Tar Ponds and Coke Ovens remediation project. PWGSC has estimated additional clean-up costs of $45,064,643 ($45,215,524 in 2011) that are not accrued, as these are not considered likely to be incurred at this time. PWGSC's ongoing efforts to assess contaminated sites may result in additional environmental liabilities related to newly identified sites, or changes in the assessments or intended use of existing sites. These liabilities will be accrued by PWGSC in the year in which they become likely and are reasonably estimable.

9. Accounts Receivable and Advances

The following table presents details of the Department's accounts receivable and advances:

(in thousands of dollars)	2012	2011
Accounts receivable from other government departments and agencies	653,717	390,605
Accounts receivable from external parties	53,785	69,286
Advances	139	247
	707,641	460,138
Less: Allowance for doubtful accounts on external receivables	(3,502)	(3,139)
Gross accounts receivable	704,139	456,999
Accounts receivable held on behalf of Government	(23,790)	(17,305)
Net accounts receivable	680,349	439,694

10. Inventory

The following table presents details of the inventory:

(in thousands of dollars)	2012	2011
Inventory held for resale	1,318	1,374
Work in Progress	2,652	3,541
Total	3,970	4,915

Inventory held for resale consists of physical items that will be sold in the future in the ordinary course of business to parties outside of the government reporting entity. Inventory held for re-sale is measured at the lower of cost and net realizable value.

Work in process includes direct costs, and recovered costs incurred for sales or transfers of properties not yet finalized at the fiscal year end.

11. Tangible Capital Assets

(in thousands of dollars)	Cost
	Opening balance	Acquisitions	Adjustments 1	Disposals and write-offs	Closing balance
Tangible capital assets
Land	252,799	-	6,466	(3,045)	256,220
Buildings	3,880,095	-	111,196	(5,593)	3,985,698
Works and infrastructure	836,787	-	126,601	-	963,388
Machinery and equipment	9,258	505	1,222	(54)	10,931
Informatics hardware and software	302,580	1,018	(58,296)	(870)	244,432
Vehicles	11,678	759	(35)	(1,242)	11,160
Leasehold improvements	688,417	-	92,051	(142)	780,326
	5,981,614	2,282	279,205	(10,946)	6,252,155
Assets under construction
Buildings	729,333	386,360	(152,322)	-	963,371
Works and infrastructure	240,082	41,792	(118,207)	-	163,667
Informatics hardware and software	174,855	58,704	(137,347)	-	96,212
Leasehold improvements	351,873	104,140	(163,487)	-	292,526
	1,496,143	590,996	(571,363)	-	1,515,776
Public Private Partnership
Assets under construction 2	71,046	96,087	-	-	167,133
	71,046	96,087	-	-	167,133
Leased tangible capital assets
Land	31,242	-	-	-	31,242
Buildings	2,221,331	154,650	(2)	(43,864)	2,332,115
Informatics equipment	2,605	-	(2,605)	-	-
Assets under construction	131,935	43,317	(12,005)	-	163,247
	2,387,113	197,967	(14,612)	(43,864)	2,526,604
Total	9,935,916	887,332	(306,770)	(54,810)	10,461,668

(in thousands of dollars)	Accumulated amortization					Net Book Value
	Opening balance	Amortization	Adjustments	Disposals and Write-Offs	Closing balance	2012	2011
Tangible capital assets
Land						256,220	252,799
Buildings	2,664,933	177,765	3,174	(5,275)	2,840,597	1,145,101	1,215,162
Works and infrastructure	380,239	32,399	-	-	412,638	550,750	456,548
Machinery and equipment	5,435	799	(722)	(44)	5,468	5,463	3,823
Informatics hardware and software	256,948	25,073	(133,663)	(868)	147,490	96,942	45,632
Vehicles	7,180	996	-	(1,174)	7,002	4,158	4,498
Leasehold improvements	342,507	65,154	3,114	(52)	410,723	369,603	345,910
	3,657,242	302,186	(128,097)	(7,413)	3,823,918	2,428,237	2,324,372
Assets under construction
Buildings						963,371	729,333
Works and infrastructure						163,667	240,082
Informatics hardware and software						96,212	174,855
Leasehold improvements						292,526	351,873
						1,515,776	1,496,143
Public Private Partnership
Assets under construction						167,133	71,046
						167,133	71,046
Leased tangible capital assets
Land						31,242	31,242
Buildings	1,033,182	169,902	(854)	(43,744)	1,158,486	1,173,629	1,188,149
Informatics equipment	2,345	174	(2,519)	-	-	-	260
Assets under construction	-	-	-	-	-	163,247	131,935
	1,035,527	170,076	(3,373)	(43,744)	1,158,486	1,368,118	1,351,586
Total	4,692,769	472,262	(131,470)	(51,157)	4,982,404	5,479,264	5,243,147

12. Departmental Net Financial Position

A portion of PWGSC's net financial position is restricted and earmarked for specified purposes. Transactions related to the Seized Property Proceeds Account are recorded in special categories of revenues, and payments and expenses are charged against such revenues.

The Seized Property Proceeds Account was established pursuant to section 13 of the Seized Property Management Act. The net proceeds received from the disposition of seized and forfeited properties to Her Majesty or fines imposed and also funds received from the governments of foreign states pursuant to agreements for the purpose of the Act are to be earmarked for specified purposes. Under the Act, expenses to be charged against the revenues include: operating expenses incurred in carrying out the purpose of the Act, amounts paid as a result of claims and repayments of advances from the Minister of Finance, interest on the drawdown from the Seized Property Working Capital Account and distribution of the proceeds to the relevant jurisdictions and the Consolidated Revenue Fund.

The balance of the account at the end of the year is included in the Consolidated Statement of Operations and Departmental Net Financial Position. Activity in the account is as follows:

(in thousands of dollars)	2012	2011 Restated (Note 17)
Seized Property Proceeds Account - Restricted
Balance - Beginning of year - Restricted	35,005	59,980
Revenues	28,685	28,675
Expenses	(30,919)	(53,650)
	(2,234)	(24,975)
Balance - End of year - Restricted	32,771	35,005
Unrestricted	2,562,656	2,291,954
Departmental net financial position - End of year	2,595,427	2,326,959

13. Contractual Obligations

The nature of PWGSC’s activities can result in some large multi-year contracts and obligations whereby the department will be obligated to make future payments when the services/goods are received.

Significant contractual obligations ($10 million or more) that can be reasonably estimated are summarized as follows:

(in thousands of dollars)	2013	2014	2015	2016	2017 and thereafter	Total
Capital assets	343,737	306,788	249,844	15,273	153,395	1,069,037
Capital assets - Future Capital Leases	16,177	29,005	41,949	51,967	1,196,535	1,335,633
Operating leases	199,275	206,647	185,532	180,117	610,477	1,382,048
Purchases	833,972	855,388	180,062	154,192	2,457,161	4,480,775
Purchases - Future Capital Leases	2,857	21,344	23,413	23,413	514,307	585,334
Total	1,396,018	1,419,172	680,800	424,962	4,931,875	8,852,827

14. Related party transactions

PWGSC is related as a result of common ownership to all government departments, agencies, and Crown Corporations. PWGSC enters into transactions with these entities in the normal course of business and on normal trade terms. During the year, the Department received and provided common services which were obtained without charge from other government departments as disclosed below.

A. Common services provided without charge by other Government Departments

During the year, the Department received services without charge from certain common service organizations, related to legal services, the employer’s contribution to the health and dental insurance plans and workers' compensation coverage. These services provided without charge have been recorded in PWGSC's Consolidated Statement of Operations and Departmental Net Financial Position as follows:

(in thousands of dollars)	2012	2011
Employer's contribution to the health and dental insurance plans (excluding revolving funds) paid by Treasury Board	57,319	57,977
Legal services provided by Justice Canada	7,034	6,750
Workers' compensation coverage provided by Human Resources and Social Development Canada	2,215	2,391
Total	66,568	67,118

The Government has centralized some of its administrative activities for efficiency, cost-effectiveness purposes and economic delivery of programs to the public. As a result, the Government uses central agencies and common service organizations so that one department performs services for all other departments and agencies without charge. The costs of these services, such as the audit services provided by the Office of the Auditor General are not included in PWGSC's Consolidated Statement of Operations and Departmental Net Financial Position.

B. Common services provided without charge to other Government Departments

As a federal common service provider, PWGSC provides accommodation without charge to other government departments. Throughout the fiscal year, PWGSC provided accommodation without charge to other government departments for a fair value amounting to $1,558,891,630 ($1,503,670,882 in 2011). These accommodation services are not recognized as revenues in the Consolidated Statement of Operations and Departmental Net Financial Position.

C. Other transactions with related parties

(in thousands of dollars)	2012	2011
Accounts receivable - other government departments and agencies	653,717	390,605
Accounts payable - other government departments and agencies	46,620	54,010
Consolidated expenses - other government departments and agencies	127,142	82,395
Consolidated revenues - other government departments and agencies	2,429,962	2,809,217

Expenses and revenues disclosed in (c) exclude common services provided without charge, which are already disclosed in (a).

D. Transfers of tangible capital assets from/to other government departments (excluding the transfer to Shared Services Canada)

During the year, PWGSC transferred tangible capital assets to other federal government departments or agencies. The transfers were measured at their net book values.

(in thousands of dollars)	2012	2011
Agriculture and Agri Food Canada	-	(10,284)
Canadian Food Inspection Agency	-	(6,203)
Health Canada	3,088	-
House of Commons	(1,682)	-
Library of Parliament	-	(972)
Transport Canada	1,339	-
Total	2,745	(17,459)

15. Transferred and Discontinued Operations

A. Transfers from/to other government departments

Effective August 4, 2011, PWGSC transferred responsibility for the Information Technology Infrastructure Services (ITIS) program to Shared Services Canada, pursuant to an Order-in-Council (PC Number: 2011-0877), including stewardship responsibility for the assets and liabilities related to the program. Accordingly, PWGSC transferred the following assets and liabilities related to the ITIS program to Shared Services Canada effective August 4, 2011:

(in thousands of dollars)	2011
Assets
Prepaid expenses	29
Tangible capital assets	34,766
Total assets transferred	34,795
Liabilities
Vacation pay and compensatory leave	5,266
Lease obligations for tangible capital assets	135
Employee future benefits	22,514
Total liabilities transferred	27,915
Adjustment to the departmental net financial position	6,880

The revenues and expenses related to the ITIS 2011-2012 activities for the period ending August 3, 2011 are amounted to $106,603,534 and $116,294,690, respectively. In addition, the 2011 comparative figures have been reclassified on the Consolidated Statement of Operations and Departmental Net Financial Position to present the revenues and expenses of the transferred operations.

During the transition period, the Department continued to administer the transferred activities on behalf of Shared Services Canada. The administered revenues and expenses amounted to $286,628,218 and to $350,887,611, respectively, for the fiscal year. These revenues and expenses are not recorded in these financial statements.

B. Discontinued Operations

On June 20, 2011, as a result of the Strategic Review Process, the department announced that the Consulting and Audit Canada Revolving Fund would be winding up by March 31, 2012. The organization ceased its operations in fiscal year 2011-2012 and no longer exists as of April 1, 2012.

The revenues and expenses related to the 2011-2012 activities of the above mentioned revolving fund are amounted to $9,667,975 and $6,750,554, respectively. In addition, the 2011 comparative figures have been reclassified on the Consolidated Statement of Operations and Departmental Net Financial Position to present revenues amounted to $30,591,691 and expenses amounted to $32,645,706 of the ceased operations.

16. Segmented Information

Presentation by segment is based on the Department's program activity 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 and revenues generated for the main program activities, by major object of expense and by major type of revenue. The segment results for the period are as follows:

(in thousands of dollars)	Accommodation and Real Property Assets	Internal Services	Acquisitions	Linguistic Management and Services	Specialized Programs and Services	Receiver General for Canada	Federal Pay and Pension Administration	Procurement Ombudsman	2012	2011 Restated (Note 17)
Expenses
Transfer payments
Payments in lieu of taxes to municipalities and other taxing authorities on behalf of other departments	509,138	-	-	-	-	-	-	-	509,138	492,432
Recovery of Payments in lieu of taxes to other departments	(509,028)	-	-	-	-	-	-	-	(509,028)	(492,445)
Other grants and contributions	-	-	-	5,053	-	-	-	-	5,053	4,214
	110	-	-	5,053	-	-	-	-	5,163	4,214
Operating expenses
Salaries and employee benefits	358,139	306,336	184,657	148,740	45,902	34,022	76,831	3,102	1,157,729	1,174,988
Repairs and maintenance	771,022	3,102	331	(698)	9,167	1,002	(642)	-	787,917	977,818
Professional and special services	494,734	179,587	29,940	39,523	11,411	5,119	17,765	495	778,574	857,77
Rentals	918,340	1,921	1,378	(264)	(1,634)	199	233	11	920,174	921,713
Amortization of tangible capital assets	445,480	2,675	19	1,957	33	868	16,204	-	467,236	441,791
Transportation and communications	15,874	5,039	14,131	2,176	2,004	48,191	3,230	21	90,666	92,173
Utilities, material and supplies	104,486	2,688	92,308	520	670	5,950	687	51	207,360	176,711
Payments in lieu of taxes to municipalities	169,167	-	-	-	-	-	-	-	169,167	164,319
Interest on capital lease payments	132,628	-	-	-	-	-	-	-	132,628	138,124
Reclassification of assets under construction	72,349	-	-	-	-	(43)	11,754	-	84,060	45,974
Land, buildings and works 3	276,349	-	-	-	-	-	-	-	45,974	159,424
Contingent and environmental liabilities	(34,140)	33,500	-	-	-	-	-	-	(640)	(30,480)
Machinery and equipment 3	41,320	6,174	2,130	1,659	828	566	1,485	1	54,163	48,007
Interest and banking fees	241	10	85	3	6	47,266	-	-	47,611	46,643
Other expenses	3,979	1,173	690	124	4,490	19	99	1	10,575	55,444
Information	1,265	511	163	100	7,374	120	195	30	9,758	13,440
Expenses from Seized Property Proceeds Account (Note 12)	-	-	30,919	-	-	-	-	-	30,919	53,650
Refunds / Adjustments to previous years' expenses	(9,596)	(7,143)	(2,560)	(39)	(6)	(39)	(32)	-	(19,415)	(11,951)
Recoveries of expenditures between programs or departments	19,940	(19,672)	725	4,547	(3,465)	(300)	1,189	-	2,964	(83,935)
Expenses incurred on behalf of Government	-	-	-	-	(30,919)	-	-	-	(30,919)	(53,650)
Total Expenses	3,781,687	520,534	354,916	203,401	45,861	142,940	128,988	3,712	5,182,039	5,192,177
Revenues
Sales of goods and information products	1,276,544	-	611	14	5,198	-	-	-	1,282,367	1,489,126
Rentals	862,674	803	-	-	-	-	-	-	863,477	806,169
Services of a non-regulatory nature	19,501	10,669	167,771	144,746	38,437	(408)	-	-	380,716	347,612
Services of a regulatory nature	7,652	347,612	-	-	(1,665)	37,515	105,050	-	149,897	149,650
Other revenues	121	1,648	23,038	1	4,281	247	18,090	-	47,426	66,525
Revenues from Seized Property Proceeds Account (Note 12)	-	-	28,685	-	-	-	-	-	28,685	28,675
Revenues earned on behalf of Government	497	(13,353)	(14,014)	358	(47,308)	(1,052)	(18,121)	-	(92,993)	(109,353)
Total revenues	2,166,989	1,112	206,091	145,119	(1,057)	36,302	105,019	-	2,659,575	2,778,404
Net cost from continuing operations	1,614,698	519,422	148,825	58,282	46,918	106,638	23,969	3,712	2,522,464	2,413,773

Services of a non-regulatory nature are mainly comprised of special accommodation and real property services, real property project management services, information technology and telecommunication services, translation services, professional services for consulting and audit services as well as traffic management.

Services of a regulatory nature are mainly comprised of cost recovery for services provided to administer the Public Service Superannuation Act (PSSA) and for payment services for Receiver General functions.

17. Restatement

A. Accounting Changes

During 2011-2012, amendments were made to Treasury Board Accounting Standard 1.2 Departmental and Agency Financial Statements to improve financial reporting by government departments and agencies. The amendments are effective for financial reporting of fiscal years ending March 31, 2012, and later. The significant changes to the Department’s financial statements are described below. These changes have been applied retroactively, and comparative information for 2010-2011 has been restated.

Net debt (calculated as liabilities less financial assets) is now presented in the Consolidated Statement of Financial Position. Accompanying this change, the Department now presents a Consolidated Statement of Change in Net Debt and no longer presents a Consolidated Statement of Equity.

Revenue and related accounts receivable are now presented net of non-respendable amounts in the Consolidated Statement of Operations and Departmental Net Financial Position and Consolidated Statement of Financial Position. The effect of this change is to increase the net cost of operations before government funding and transfers by $92,993,140 for 2012 ($109,353,248 for 2011) and decrease total financial assets by $22,508,452 for 2012 ($25,673,607 for 2011).

Government funding and transfers, as well as the credit related to services provided without charge by other government departments, are now recognized in the Statement of Operations and Departmental Net Financial Position below “Net cost of operations before government funding and transfers.” These transactions have been reclassified in this table and presented under the Consolidated Statement of Operations and Departmental Net Financial Position as they were previously under the Consolidated Statement of Equity of Canada. The effect of this change is to decrease the net cost of operations before government funding and transfers by $5,124,664,120 for 2012 ($4,883,219,275 for 2011).

B. Restatement of Tangible Capital Assets

In the publication process of the 2010-11 Consolidated Financial Statements, a number have been erroneously reported twice in the tangible capital assets balance of the department. Additional measures have been implemented in the production and publication process to mitigate the recurrent risks of similar situations in the future.

This situation has been accounted for retroactively in the present statements, with the following restatement and impact on 2010-11 comparative figures:

(in thousands of dollars)	As previously stated	Effect of changes		Restated
		17.A	17.B
Consolidated Statement of Financial Position
Financial assets
Assets held on behalf of Government	-	(25,674)	-	(25,674)
Non-financial assets
Tangible capital assets (Note 11)	5,272,803	-	(29,656)	5,243,147
Departmental net financial position	2,382,289	(25,674)	(29,656)	2,326,959
Consolidated Statement of Operations and Departmental Net Financial Position
Revenues	2,887,757	(109,353)	-	2,778,404
Expenses	5,245,827	(53,650)	-	5,192,177
Government funding and transfers 4
Net cash provided by Government of Canada	2,959,765	48,771	-	3,008,536
Change in due from Consolidated Revenue Fund	44,343	-	-	44,343
Services provided without charge by other goverment departments (Note 14)	67,118	-	-	67,118
Other transactions with related parties (Note 14)	(17,459)	-	-	(17,459)
Transfer of assets and liabilities from (to) other government departments (Note 15)	-	-	-	-
Departmental net financial position ‐ Beginning of year	1,810,336	-	(29,656)	1,780,680
Departmental net financial position ‐ End of year	2,382,289	-	(29,656)	2,326,959
Note 11 Tangible capital assets
Assets under construction
Works and infrastructure	269,738	-	(29,656)	240,082
Total	5,272,803	-	(29,656)	5,243,147

18. Comparative Information

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

---

1. Adjustments include assets under construction of $345,912,553 that were transferred to the other categories upon completion of the assets. Effective August 4, 2011, the Department transferred land and buildings with a net book value of $34,766,415 to Shared Services Canada. This transfer is included in the adjustment columns (refer to note 15 for further detail on the transfer). (Return to original note 1)
2. The total acquisition of $641M as presented in the Consolidated Statement of Cash Flow is comprised of the acquisition of Tangible capital assets, the acquisition of Assets under construction and the part ($48M) of the Assets under construction acquired under the Public Private Partnership agreement that impacted the Consolidated Statement of Cash Flow. (Return to original note 2)
3. These expenses are mainly related to tangible capital assets that are below PWGSC's capitalization threshold. (Note 2m) (Return to original note 3)
4. These transactions have been included in this table under the Consolidated Statement of Operations and Departmental Net Financial Position as they were previously presented under the Consolidated Statement of Equity of Canada. (Return to original note 4)