Future-oriented Statements 2019-2020

Copyright Board of Canada (116)

Copyright Board of Canada
Future-Oriented Statement of Operations (Unaudited)
For the year ended March 31

The accompanying notes form an integral part of these financial statements

Copyright Board of Canada
Notes to the Future-Oriented Statement of Operations (Unaudited)
At March 31

1. Authority and Objectives

The Copyright Board of Canada is an independent administrative agency which has been conferred department status for purposes of the Financial Administration Act. Its mandate stems from the Copyright Act.

The Copyright Board of Canada plays a major role in the collective administration of copyright, particularly where the public performance and the communication to the public, by telecommunication, of musical works, as well as the retransmission of distant radio and television signals are concerned. The Copyright Board of Canada plays a surveillance role in three ways with respect to collective societies which administer very large repertoires of work created by a multitude of originators both in Canada and in other countries: as an economic regulatory body, by approving tariff proposals by the various copyright collective societies; as an arbitrator in private disputes; and as an arbitrator of the public interest.

The Copyright Board of Canada’s principal mandate is to set royalties which are fair and reasonable for both copyright owners and the users of copyright-protected works, as well as issuing non-exclusive licences authorizing the fully legal use of works when the copyright owner cannot be located.

The Copyright Board of Canada reports annually to Parliament through the Minister of Innovation, Science and Economic Development.

2. Methodology and Significant Assumptions

The future-oriented statement of operations has been prepared on the basis of the government priorities and departmental plans as described in the Departmental Plan.

The information in the forecast 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 fiscal year 2019–20.

The main assumptions are as follows:

• the Copyright Board of Canada’s activities will remain substantially the same as for the previous year, with the exception of the New Intellectual Property Strategy of 2019–20;
• 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.
• allowances are based on historical experience and the most up-to-date information possible.
• the resources provided will enable the Copyright Board to deliver the expected results specified in the Departmental Plan.

These assumptions are adopted as at January 31, 2018.

3. Variations and Changes to the Forecast Financial Information

Although 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 differ from the forecast information presented, and this variation could be material.

In preparing the Future-Oriented Statements of Operations, the Copyright Board of Canada has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are based on past experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances, and continually evaluated.

Factors that could lead to material differences between the Future-Oriented Statement of Operations and the historical statement of operations include:

1. the timing and the amount of acquisitions and disposals of property, plant and equipment, which may affect gains, losses and amortization expense;
2. the implementation of new collective agreements;
3. economic conditions may affect both the amount of revenue earned and the collectability of loan receivables;
4. interest rates in effect at the time of issue, which will effect the net present value of non-interest bearing loans;
5. other changes to the operating budget, such as new initiatives or technical adjustments later in the year.

After the Departmental Plan is tabled in Parliament, the Copyright Board of Canada will not be updating the forecasts for any changes in financial resources made in ensuing supplementary estimates. Variances will be explained in the Departmental Results Report.

4. Summary of Significant Accounting Policies

The Future-Oriented Statement of Operations has been prepared using the Government of Canada's accounting policies in effect for the 2018–19 fiscal year, and is 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:

1. Expenses
   
   Transfer payments are recorded as an expense in the year the transfer is authorized and all eligibility criteria have been met by the recipient.
   
   Other expenses are generally recorded when goods are received or services are rendered and include expenses related to personnel, professional and special services, repair and maintenance, utilities, materials and supplies, as well as amortization of tangible capital assets. Provisions to reflect changes in the value of assets or liabilities, such as provisions for bad debts, loans, investments and advances and inventory obsolescence, as well as utilization of inventories and prepaid expenses, and other are also included in other expenses.
    
2. Revenues
   
   Revenues from regulatory fees are recognized based on the services provided in the fiscal year.
   
   Funds received from external parties for specified purposes are recorded upon receipt as deferred revenue. These revenues are recognized in the period in which the related expenses are incurred.
   
   Deferred revenue consists of amounts received in advance of the delivery of goods, and rendering of services that will be recognized as revenue in a subsequent fiscal year as it is earned.
   
   Other revenues are recognized in the period the event giving rise to the revenues occurred.
   
   Revenues that are non-respendable are not available to discharge the Copyright Board’s liabilities. Although the Deputy Head is expected to maintain accounting control, he or she has no authority over 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 as a reduction of the Board’s gross revenues.

5. Parliamentary Authorities

The Copyright Board of Canada is financed by the Government of Canada through parliamentary authorities. Financial reporting of authorities provided to the Copyright Board of Canada differs from financial reporting according to generally accepted accounting principles because authorities are based mainly on cash flow requirements. Items recognized in the Future-Oriented Statement of Operations in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, the Copyright Board of Canada has different net cost 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 the net cost of operations to requested authorities

b) Authorities requested