Financial Statements

Statement of 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, 2016, and all information contained in these statements rests with the management of the Department of Justice. These 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 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 of Justice’s financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in the Department of Justice’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 (ICFR) 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 of Justice and through conducting an annual risk-based assessment of the effectiveness of the system of ICFR.

The system of ICFR is designed to mitigate risks to a reasonable level based on an ongoing process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

A risk-based assessment of the system of ICFR for the year ended March 31, 2016 was completed in accordance with the Treasury Board Policy on Internal Control and the results and action plans are summarized in the annex.

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

The financial statements of the Department of Justice have not been audited.

William F. Pentney, Q.C.
Deputy Minister of Justice and
Deputy Attorney General of Canada

Ottawa, Canada
September 2, 2016

Johanne Bernard, CPA, CMA
Assistant Deputy Minister
Management Sector, and
Chief Financial Officer

Statement of Financial Position (Unaudited)
As at March 31
(in thousands of dollars)
  2016 2015
Liabilities
Accounts payable and accrued liabilities (note 4) 63,799 62,251
Family Law account (note 5) 3,130 5,565
Transfer payments payable 283,867 345,864
Vacation pay and compensatory leave 20,269 19,664
Employee future benefits (note 6) 46,244 43,640
Total liabilities 417,309 476,984
Financial assets
Due from the Consolidated Revenue Fund 317,740 376,685
Accounts receivable and advances (note 7) 34,037 32,645
Total gross financial assets 351,777 409,330
Financial assets held on behalf of Government
Accounts receivable and advances (note 7) (751) (807)
Total net financial assets 351,026 408,523
Departmental net debt 66,283 68,461
Non-financial assets
Prepaid expenses 853 58
Tangible capital assets (note 8) 33,318 36,158
Total non-financial assets 34,171 36,216
Departmental net financial position (32,112) (32,245)

Contractual obligations (note 9)

Contingent liabilities (note 10)

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

William F. Pentney, Q.C.
Deputy Minister of Justice and
Deputy Attorney General of Canada

Ottawa, Canada
September 2, 2016

Johanne Bernard, CPA, CMA
Assistant Deputy Minister
Management Sector, and
Chief Financial Officer

Statement of Operations and Departmental Net Financial Position (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2016 Planned Results 2016 2015 Restated (note 14)
Expenses
Legal services to Government program 522,333 485,957 492,542
Stewardship of the Canadian Legal Framework 438,649 414,554 416,565
Office of the Federal Ombudsman for Victims of Crime 1,462 1,218 1,143
Internal Services 170,732 158,553 173,661
Total expenses 1,133,176 1,060,282 1,083,911
Revenues
Legal services 337,958 333,098 336,854
Family Law fees 8,376 8,132 7,721
Common services 3,455 3,352 3,518
Other revenues - 5,361 824
Revenues earned on behalf of Government (8,376) (56,366) (51,692)
Total revenues 341,413 293,577 297,225
Net cost of operations before government funding and transfers 791,763 766,705 786,686
Government funding and transfers
Net cash provided by Government   736,471 632,613
Change in due from Consolidated Revenue Fund   (58,945) 72,722
Services provided without charge by other government departments (note 11)   89,506 88,398
Transfer of the transition payments for implementing salary payments in arrears (note 12)   (193) (17,849)
Transfer of tangible capital assets to other government departments   (1) -
Net cost (revenue) of operations after government funding and transfers   (133) 10,802
Departmental net financial position - Beginning of Year   (32,245) (21,443)
Departmental net financial position - End of Year   (32,112) (32,245)

Segmented information (note 13)

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

Statement of Change in Departmental Net Debt (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2016 2015
Net cost (revenue) of operations after government funding and transfers (133) 10,802
Change due to tangible capital assets
Acquisitions of tangible capital assets 10,213 7,450
Amortization of tangible capital assets (12,487) (13,550)
Net loss on write off of tangible capital assets (565) (1,346)
Transfer of tangible capital assets to other government departments (1) -
Total change due to tangible capital assets (2,840) (7,446)
Change due to prepaid expenses 795 (8)
Net increase (decrease) in departmental net debt (2,178) 3,348
Departmental net debt - Beginning of Year 68,461 65,113
Departmental net debt - End of Year 66,283 68,461

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

Statement of Cash Flows (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2016 2015 Restated (note 14)
Operating activities
Net cost of operations before government funding and transfers 766,705 786,686
Non-cash items:
Amortization of tangible capital assets (note 8) (12,487) (13,550)
Loss on write off of capital assets (565) (1,346)
Services provided without charge by other government departments (note 11) (89,506) (88,398)
Transition payments for implementing salary payments in arrears (note 12) 193 17,849
Variations in Statement of Financial Position:
Increase in accounts receivable and advances 1,448 2,689
Increase (decrease) in prepaid expenses 795 (8)
Increase in accounts payable and accrued liabilities (1,548) (7,903)
Decrease (increase) in Family Law account 2,435 (4,062)
Decrease (increase) in transfer payments payable 61,997 (57,799)
Increase in vacation pay and compensatory leave (605) (645)
Increase in future employee benefits (2,604) (8,350)
Cash used in operating activities 726,258 625,163
Capital investment activities
Acquisitions of tangible capital assets (note 8) 10,213 7,450
Cash used in capital investment activities 10,213 7,450
Net cash provided by Government of Canada 736,471 632,613

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

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