2019–20 Future-oriented statement of operations

Table of contents

1. Methodology and significant assumptions
2. Variations and changes to the forecast financial information
3. Summary of significant accounting policies
4. Parliamentary authorities

The accompanying notes form an integral part of these future-oriented financialstatements.

Notes to the future-oriented statement of operations

1. Methodology and significant assumptions

The future-oriented financial statements have been prepared on the basis of the government priorities and the plans of the organization as described in the Report on Plans and Priorities.

The information in the estimated results for fiscal year 2018-19 is based on actual results as at December 31, 2018 and on forecasts for the remainder of the fiscal year. Forecasts have been made for the planned results for the year 2019-20 (future year) fiscal year.

The main assumptions underlying the forecasts are as follows:

• OCL's activities will remain substantially the same as for the previous year.
• Expenses, including the determination of amounts internal and external to the government, are based on historical experience. The general historical pattern is expected to continue.

These assumptions are adopted as at January 31, 2019.

2. Variations and changes to the forecast financial information

While every attempt has been made to forecast final results for the remainder of 2018-19 and for 2019-20, actual results achieved for both years are likely to vary from the forecast information presented, and this variation could be material.

In preparing these future-oriented financial statements, OCL has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Factors that could lead to material differences between the future-oriented financial statements and the historical financial statements include:

• The timing and amounts of acquisitions and disposals of property, plant and equipment may affect gains/losses and amortization expense.
• Implementation of new collective agreements.
• Further changes to the operating budget through additional new initiatives or technical adjustments later in the year.

Once the Report on Plans and Priorities is presented, OCL will not be updating the forecasts for any changes to authorities or forecast financial information made in ensuing supplementary estimates. Variances will be explained in the Departmental Performance Report.

3. Summary of significant accounting policies

"The future-oriented statement of operations has been prepared using the Government's accounting policies that came into effect for the 2011-12 fiscal year which are based on Canadian public sector accounting standards. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian public sector accounting standards."

Significant accounting policies are as follows:

Expenses

Expenses are recorded on an accrual basis:

• Expenses for the OCL operations are recorded when goods are received or services are rendered including services provided without charges for accommodation, employee contributions to health and dental insurance plans, and audit services which are recorded as expenses at their estimated cost.
• Vacation pay and compensatory leave as well as severance benefits are accrued and expenses are recorded as the benefits are earned by employees under their respective terms of employment.
• Expenses also include amortization of tangible capital assets which are capitalized at their acquisition cost. Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset.

4. Parliamentary authorities

OCL receives its funding through annual parliamentary authorities. Items recognized in the Future-oriented Statement of Operations and Net Financial Position and the Future-oriented Statement of Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, OCL 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: