Financial Statements

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 departmental management. These financial statements have been prepared by management in accordance with Treasury Board accounting policies, which are based on 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 Department's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada and included in the Department'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 Department; 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 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 identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments. The effectiveness and adequacy of the Department's system of internal control is reviewed by the work of internal audit staff, who conduct periodic audits of different areas of the Department's operations, and by the Departmental Audit Committee, which oversees management's responsibilities for maintaining adequate control systems and the quality of financial reporting, and which recommends the financial statements to the Deputy Head of the Department.

The financial statements of the Department have not been audited.

Myles J. Kirvan
Deputy Minister of Justice and
Deputy Attorney General of Canada

Ottawa, Canada
August  12, 2010

Daniel Schnob
Chief Financial Officer

Statement of Financial Position (Unaudited)
As at March 31
(in thousands of dollars)

Assets
  2010 2009
Restated
(Note 3)
Financial assets
Due from the Consolidated Revenue Fund 444,915 398,017
Receivables and advances (Note 7) 19,151 19,691
Total financial assets 464,066 417,708
Non-financial assets
Prepaid expenses 85 78
Tangible capital assets (Note 8) 40,282 36,836
Total non-financial assets 40,367 36,914
Total 504,433 454,622

Liabilities and Equity of Canada
  2010 2009
Restated
(Note 3)
Liabilities
Accounts payable and accrued liabilities (Note 9) 70,284 92,672
Family Law account (Note 10) 6,578 6,626
Transfer payments payable 400,114 350,658
Vacation pay and compensatory leave 18,082 16,331
Employee severance benefits (Note 11) 90,297 96,249
Total liabilities 585,355 562,536
Deficit of Canada (80,922) (107,914)
Total 504,433 454,622

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

Myles J. Kirvan
Deputy Minister of Justice and
Deputy Attorney General of Canada

Ottawa, Canada
August  12, 2010

Daniel Schnob
Chief Financial Officer

Statement of Operations (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2010 2009
Restated
(Note 3)
Expenses (Note 5 and Note 16)
Services to government 449,566 440,957
Justice policies, laws and programs 462,519 418,396
The Office of the Federal Ombundsman for Victims of Crime 1,353 1,315
Internal Services 161,923 158,297
Total expenses 1,075,361 1,018,965
Revenues (Note 6 and Note 16)
Services to government 262,281 234,208
Justice policies, laws and programs 8,603 8,126
Internal Services 64 11
Total revenues 270,948 242,345
Net cost of operations 804,413 776,620

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

Statement of Equity of Canada (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2010 2009
Restated
(Note 3)
Deficit of Canada, beginning of year (107,914) (74,617)
Net cost of operations (804,413) (776,620)
Change in due from the Consolidated Revenue Fund 46,898 (334,668)
Net cash provided by Government 702,045 1,001,226
Services provided without charge by other government departments (Note 14) 82,462 76,765
Deficit of Canada, end of year (80,922) (107,914)

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

Statement of Cash Flow (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2010 2009
Restated
(Note 3)
Operating activities
Net cost of operations 804,413 776,620
Non-cash items
Amortization of tangible capital assets (Note 8) (10,700) (10,605)
Loss on disposal and transfer of capital assets - (27)
Services provided without charge by other government departments (Note 14) (82,462) (76,765)
Variations in Statement of Financial Position
(Decrease) increase in accounts receivable and advances (540) (21,574)
Increase (decrease) in prepaid expenses 7 (25)
Decrease (increase) in liabilities (22,819) 318,802
Cash used by operating activities 687,899 986,426
Capital investment activities
Acquisitions of tangible capital assets (Note 8) 14,146 14,800
Cash used by capital investment activities 14,146 14,800
Net cash provided by Government 702,045 1,001,226

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

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