Financial Statements 2008-09

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Statement of Management Responsibility

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2009 and all information contained in these statements rests with management of the Canadian International Development Agency (CIDA). These financial statements have been prepared by management in accordance with Treasury Board accounting policies, which are consistent with 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 CIDA's financial transactions. Financial information submitted to the Public Accounts of Canada and included in CIDA's Departmental Performance Report is consistent with these financial statements.

Management maintains a system of financial management and internal control designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are in accordance with the Financial Administration Act, are executed in accordance with prescribed regulations, within Parliamentary authorities, and are properly recorded to maintain accountability of Government funds. Management also seeks to ensure the objectivity and integrity of data in its financial statements by careful selection, training and development of qualified staff, by organizational arrangements that provide appropriate divisions of responsibility, and by communication programs aimed at ensuring that regulations, policies, standards and managerial authorities are understood throughout CIDA.

CIDA's financial statements have not been audited.


_______________________________
Margaret Biggs
President

 


_______________________________
Date


_______________________________
Christine Walker
Chief Financial Officer

 


_______________________________
Date

Canadian International Development Agency
Statement of Operations (unaudited) for the year ended March 31
(in thousands of dollars)
 20092008
Expenses (Note 4) (Note 18)
Multilateral, International and Canadian Institutions1,297,3431,149,791
Countries of Concentration943,535761,040
Fragile States and Countries Experiencing Humanitarian Crisis874,355608,287
Selected Countries and Regions336,326412,954
Engaging Canadian Citizens29,14154,202
Total expenses3,480,7002,986,274
Revenues (Note 5)  
Multilateral, International and Canadian Institutions162,80089,542
Countries of Concentration32,6258,443
Selected Countries and Regions11,2248,124
Fragile States and Countries Experiencing Humanitarian Crisis149
Engaging Canadian Citizens48
Total revenues206,667106,126
Net cost of operations3,274,0332,880,148

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

Canadian International Development Agency
Statement of Financial Position (unaudited) as at March 31
(in thousands of dollars)
 20092008
Assets  
Financial assets  
Accounts receivable and advances (Note 6)3,9074,947
Loans to developing countries and international financial institutions (Note 7)142,998159,818
Investments and advances to international financial institutions (Note 8)6,054,5525,663,827
Allowance for valuation of investments and advances to international financial institutions (Note 8)(6,054,552)(5,663,827)
Canada Investment Fund for Africa (Note 9)90,399100,000
Total financial assets237,304264,765
Non-financial assets  
Prepaid expenses189,793105,755
Tangible capital assets (Note 10)3,8732,549
Total non-financial assets193,666108,304
Total430,970373,069
Liabilities  
Accounts payable and accrued liabilities (Note 11)569,799300,983
Vacation pay and compensatory leave8,3868,449
Notes payable to international financial institutions (Note 12)9,76328,791
Accrued liability for matching funds programs13,61272,509
Employee severance benefits (Note 13)39,41133,081
Otder liabilities (Note 14)1,0001,840
Total liabilities641,971445,653
Equity of Canada(211,001)(72,584)
Total430,970373,069

Contingent liabilities (Note 15)
Contractual obligations (Note 16)

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

Canadian International Development Agency
Statement of Equity of Canada (unaudited) as at March 31
(in thousands of dollars)
 20092008
Equity of Canada, beginning of year(72,584)(621,057)
Net cost of operations(3,274,033)(2,880,148)
Current year appropriations used (Note 3)3,818,4973,469,452
Revenue not available for spending(15,928)(8,568)
Change in net position in the Consolidated Revenue
Fund (Note 3 (c))
(688,897)(51,201)
Services provided without charge by other
government departments (Note 17)
21,94418,938
Equity of Canada, end of year(211,001)(72,584)

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

Canadian International Development Agency
Statement of Cash Flow (unaudited)
for the year ended March 31
(in thousands of dollars)
 20092008
Operating activities  
Cash received from :  
Interest and service fees on loans2,2802,427
Other revenues4,1761,233
Sub-total Cash received from6,4563,660
Cash paid for :  
Transfer payments(2,646,838)(2,856,230)
Salaries and employee benefits(177,787)(166,140)
Operating and maintenance(73,505)(73,890)
Sub-total Cash paid from(2,898,130)(3,096,260)
Cash used by operating activities(2,891,674)(3,092,600)
Investment activities  
Net acquisitions of capital assets(2,445)(586)
Decrease in loans24,34226,566
Increase in investments and advances(247,483)(302,725)
Decrease in the Canada Investment Fund
for Africa
3,588(40,337)
Cash used for investment activities(221,998)(317,082)
Financing activities  
Net cash provided by Government of Canada3,113,6723,409,682

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

1. Authority and objectives

The Canadian International Development Agency (CIDA) is designated as a department for the purposes of the Financial Administration Act by Order-in-Council P.C. 1968-923 of May 8, 1968. The authority for the CIDA program and related purposes is found in the Department of Foreign Affairs and International Trade Act, in the Annual Appropriations Act and in the International Development (Financial Institutions) Assistance Act . CIDA is the lead government organization responsible for Canada's Official Development Assistance (ODA). In addition, the Official Development Assistance Accountability Act (ODAAA) came into force on June 28, 2008. The ODAAA imposes reporting obligations on the Government.

The three goals of Canadian foreign policy are the promotion of prosperity, the protection of Canadians and global security, and the projection of Canadian values. CIDA's mandate is to manage Canada's support and resources effectively and accountably to achieve meaningful, sustainable results, and engage in policy development in Canada and internationally, enabling Canada's efforts to realize its development objectives. CIDA fulfills its mandate through five main business lines :

  • "Multilateral, International and Canadian Institutions" program activities support programming development assistance and engaging with selected multilateral institutions and Canadian/international organizations. A considerable portion of CIDA programming is devoted to providing assistance to, and through, multilateral or international organizations, which play important roles in providing development assistance worldwide, through financial contributions, expertise, and implementation of projects in the field. CIDA supports organizations whose mandates, objectives and capacities to deliver development initiatives are consistent with Government of Canada objectives and priorities.
  • "Countries of Concentration" program activities involve programming long-term development assistance in selected countries of concentration. CIDA has long-standing relationships with a limited number of countries of concentration. These countries have goals and significant development needs in areas where Canada provides added value. The focus is on enhancing their capacity to achieve their development goals.
  • "Fragile States and Countries Experiencing Humanitarian Crisis" program activities involve programming development and/or humanitarian assistance in fragile states and/or countries experiencing humanitarian crises. Fragile states present a complex and challenging situation, yet Canada's action is critical to creating a more stable and secure environment. To help fragile states restore the capacity of their public institutions and civil societies, CIDA must provide effective and equitable long-term development investments. In countries experiencing humanitarian crisis brought on by natural disasters or conflicts, CIDA focuses on helping people improve their situation. This means returning key health, nutrition, mortality, stability and other indicators to pre-crisis levels for all people as soon as possible. To achieve this, CIDA must provide effective, and timely, humanitarian aid.
  • "Selected Countries and Regions" program activities involve programming development assistance in selected countries and regions eligible for Canadian international assistance. The countries and regions in this grouping are at varying stages of development, but all have some level of strategic importance to their neighbors and/or to Canada. They also play a key role in addressing regional dimensions of development, including trans-boundary issues like pollution, conflict, communicable diseases and natural resource management. Initiatives with selected countries and regions are designed to assist them to achieve stability and/or development goals, and are delivered in partnership with the private sector, NGOs, academia, ethnic communities and other levels of government. The aid focus is to complement other Canadian government departmental objectives, and to build upon the linkages established between Canadian partners and their local partners in selected countries and regions. Policy dialogue and advice also complement CIDA's programming efforts.
  • "Engaging Canadian Citizens" program activities provide opportunities for Canadians to increase their awareness, deepen their understanding and foster their greater engagement in international development. The Agency undertakes a range of initiatives to inform and engage Canadians, including outreach to youth, support for the public engagement activities of Canadian partners, support for mass media and education initiatives to increase awareness and understanding of international development and cooperation issues among Canadians.

2. Summary of significant accounting policies

The financial statements have been prepared in accordance with Treasury Board accounting policies, which are consistent with Canadian generally accepted accounting principles for the public sector.

Significant accounting policies are as follows :

(a) Parliamentary appropriations
CIDA is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to CIDA do not fully align with financial reporting according to generally accepted accounting principles since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the statement of operations and the statement of financial position are not necessarily the same as those provided through appropriations from Parliament. Note 3 provides a high-level reconciliation between the two bases of reporting.

(b) Net cash provided by government
CIDA operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by CIDA is deposited to the CRF and all cash disbursements made by CIDA 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.

(c) Change in net position in the Consolidated Revenue Fund
Represents the difference between the net cash provided by Government and appropriations used in a year, excluding the amount of non respendable revenue recorded by CIDA. It results from timing differences between when a transaction affects appropriations and when it is processed through the CRF.

(d) Revenues
Revenues are accounted for in the period in which the transaction or event that gave rise to the revenues occurred. CIDA's revenues mainly consist of foreign exchange gain on revaluation as well as interest and service fees on loans.

(e) Expenses
Expenses are recorded on the accrual basis. CIDA's expenses mainly consist of grants and contributions, operating transactions and foreign exchange loss on revaluation.

  • Grants are recognized in the year in which the conditions for payment are met. In the case of grants that do not form part of an existing program, the expense is recognized 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.
  • Contributions are recognized in the year in which the recipient has met the eligibility criteria or fulfilled the terms of a contractual transfer agreement.
  • Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
  • Services provided without charge by other government departments, such as accommodation, employer's contribution to the health and dental insurance plans and legal services, are recorded as operating expenses at their estimated cost.

(f) Employee future benefits

(i) Pension benefits: Eligible employees participate in the Public Service Superannuation Plan. This defined benefit is a multi-employer pension plan administered by the Government of Canada. CIDA's contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. Current legislation does not require CIDA to make contributions for any actuarial deficiencies of the Plan.

(ii) Severance benefits: Employees are entitled to severance benefits under labour contracts or conditions of employment. These benefits are accrued as employees render the services necessary to earn them. 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.

(g) Accounts receivable and advances
Accounts receivable and advances are stated at amounts expected to be ultimately realized. An allowance is taken for receivables where recovery is considered uncertain.

(h) Loans to developing countries and International Financial Institutions (IFI)
Loans to developing countries and International Financial Institutions for international development assistance are recorded at cost and are adjusted to reflect the concessionary terms of those loans made on a long-term, low interest or interest-free basis. The discount determined at the date of the issuance is amortized to revenue using a straight-line amortization. Any interest or service fees revenue is recognized with the passage of time and according to the terms of the loan agreement. However, when specific loan balances are deemed uncollectible, interest and service fees revenue ceases to be accrued on these loans. No new loans have been recorded by CIDA since April 1, 1986.

An allowance for valuation is further used to reduce the carrying value of the loans to amounts that approximate their net realizable value. The allowance is determined based on the Government's identification and evaluation of countries that have formally applied for debt relief, estimated probable losses that exist on the remaining portfolio, and changes in the economic conditions of sovereign debtors.

Any loans written off or forgiven are presented as an integral part of the Countries of Concentration expense in the Statement of Operations and distinctly under Transfer payments in the note on expenses, in the fiscal year during which the required Parliamentary authority is obtained and the government of Canada writes off or forgives the loan amounts owing to CIDA. Should subsequent recoveries arise, they are presented in the revenue for Countries of Concentration in the Statement of Operations and are highlighted in the note on revenues in the fiscal year during which the monies are received.

See Note 7 for more details.

(i) Investments and advances to International Financial Institutions (IFI)
Investments and advances to International Financial Institutions are recorded at cost.

Investments

Investments consist of subscriptions to the share capital of a number of international financial institutions and are composed of both paid-in and callable capital. Subscriptions to international organizations do not provide a return on investment, but are repayable on termination of the organization or upon CIDA's withdrawal from the organization. Paid-in capital is made through a combination of cash payments and the issuance of non-interest bearing, non-negotiable notes payable to the organization. Callable share capital is composed of resources that are not paid to the banks but act as a guarantee to allow them to borrow on international capital markets to finance their lending program.

Advances

Advances are issued to International Financial Institutions that use these funds to issue loans to developing countries at concessionary terms.

For these investments and advances to International Financial Institutions, an allowance is established based on their estimated realizable value.

See Note 8 for more details.

(j) Prepaid expenses
CIDA has the authority to make advance payments under CIDA's Terms and Conditions for contribution agreements before the expenditures are incurred. The portion of a payment which is intended to cover expenses to be incurred in a subsequent fiscal year is recorded as prepaid expenses.

(k) Tangible capital assets
All tangible capital assets having an initial cost of 10,000 or more are recorded at their acquisition cost.

Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the tangible capital asset as follows:
Asset ClassAmortization period
Communication equipment3 years
Informatics equipment5 years
Computer Software3-5 years
Other equipment3-5 years
Vehicles5 years
Assets under constructionOnce in service, in accordance with asset type

(l) Notes payable to International Financial Institutions (IFI)
Notes payable to International Financial Institutions represent non-interest bearing, non-negotiable demand notes for share capital subscriptions and advances that are later presented for encashment according to the terms of the agreement. Amounts pertaining to notes already issued and the related future encashment obligations are presented in the Statement of Financial Position under Notes payable to International Financial Institutions, while the amounts for notes payable that will be both issued and encashed under the terms of signed agreements are presented in Note 16 on contractual obligations.

(m) Contingent liabilities
Contingent liabilities are potential liabilities that 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 financial statements.

(n) Foreign currency transactions
Transactions involving foreign currencies are translated into Canadian dollar equivalents using rates of exchange in effect at the time of those transactions. Monetary assets and liabilities denominated in a foreign currency are translated into Canadian dollars using the rate of exchange in effect on March 31. Gains and losses resulting from foreign currency transactions are included in the Statement of Operations, and shown in Notes 4 and 5.

(o) Measurement uncertainty
The preparation of these financial statements in accordance with Treasury Board accounting policies are consistent with Canadian generally accepted accounting principles for the public sector, which requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. The most significant items where estimates are used are in determining the allowance for doubtful accounts, allowance for loans, prepaid contributions, the useful life of tangible capital assets, contingent liabilities and the liability for employee severance benefits. Actual results could significantly differ from those estimated. Management's estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

3. Parliamentary Appropriations

CIDA receives its funding through annual Parliamentary appropriations. Items recognized in the Statement of Operations and the Statement of Financial Position in one year may be funded through Parliamentary appropriations in prior, current or future years. Accordingly, CIDA 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 appropriations used
(in thousands of dollars)20092008
Net cost of operations3,274,0332,880,148
Adjustments for items affecting net cost of operations
but not affecting appropriations:
  
Add (Less):  
Amortization of tangible capital assets(1,098)(1,088)
Bad debts expense(2,265)(388)
Services provided without charge(21,944)(18,938)
Refunds of prior years expenditures13,9017,324
Gains on foreign exchange162,83889,069
(Loss) Gain on disposal of tangible capital assets(23)-
Other revenue5,4162,902
Discounts and allowance related to loans7,52217,915
Variation in notes payables for advances11,52286,814
Accrued liability for matching fund programs53,34441,355
Vacation pay and compensatory leave63(208)
Employee severance benefits(6,331)(1,897)
Contingent liability related to the Budget Implementation Act, 2007-110,000
 3,496,9783,213,008
Adjustments for items not affecting net cost of operations but affecting appropriations:  
Add (Less):  
Capital acquisitions2,445586
Prepaid expenses84,038489
Advances / subscriptions to International Financial Institutions235,036215,032
Payments to the Canada Investment Fund for Africa-40,337
Current year appropriations used3,818,4973,469,452
(b) Appropriations provided and used
(in thousands of dollars)20092008
Appropriations provided  
Budgetary  
Vote 20 - Operating expenditures232,437235,958
Vote 25 - Grants and contributions2,947,1272,517,123
Statutory amounts426,953524,351
Total Budgetary3,606,5173,277,432
Non-Budgetary  
Vote L30 - Issuance of notes to the
Fund Accounts
227,032215,032
Vote L40 - Contribution to the Canada
Investment Fund for Africa
-45,583
Statutory amounts8,685,6627,360,374
Total Non-Budgetary8,912,6947,620,989
Total appropriations provided12,519,21110,898,421
Less:  
Appropriations available for future years(8,677,658)(7,356,735)
Lapsed appropriations: Operating(6,774)(20,253)
Lapsed appropriations: Grants and contributions(16,282)(43,096)
Statutory appropriations lapsed-4
Lapsed non-budgetary appropriations-(8,889)
Current year appropriations used3,818,4973,469,452
(c) Reconciliation of net cash provided by Government to current year appropriations used
(in thousands of dollars)20092008
Net cash provided by Government3,113,6723,409,682
Revenue not available for spending15,9288,569
Change in net position in the Consolidated Revenue Fund  
Variation in accounts receivable and advances1,040488
Variation in accounts payable and accrued liabilities268,816(276,879)
Variation in discounts, allowances related to loans, investments and advances to developing countries and international financial institutions383,203109,195
Other adjustments35,838218,397
 688,89751,201
Current year appropriations used3,818,4973,469,452

4. Expenses

The following table presents details of expenses by category:
(in thousands of dollars)20092008
Transfer payments  
Multilateral, International and Canadian Institutions1,065,4611,005,943
Countries of Concentration881,060687,900
Fragile States and Countries Experiencing Humanitarian Crisis822,756569,280
Selected Countries and Regions248,502329,557
Engaging Canadian Citizens20,66644,233
Total transfer payment expenses3,038,4452,636,913
Operating  
Salaries and employee benefits202,358179,322
Loss on foreign exchange163,27088,813
Professional and special services37,79339,684
Travel and communication15,05817,168
Rentals12,08811,255
Repair and maintenance6,0775,520
Bad debts2,265388
Communication, computer and office material2,1684,810
Amortization of tangible capital assets1,0981,088
Other801,313
Total operating expenses442,255349,361
Total expenses3,480,7002,986,274

5. Revenues

The following table presents details of revenues by category:
(in thousands of dollars)20092008
Gains on foreign exchange162,83889,069
Amortization of discount on loans38,41314,154
Other revenues3,136621
Interest and service fees on loans2,2802,282
Total revenues206,667106,126

6. Accounts receivable and advances

Accounts receivable and advances for CIDA consist mainly of:

  • Amounts to be recovered where the recipient has not complied with the terms and conditions of the contribution agreement for which a payment has been made.
  • Salaries to be recovered for CIDA's employees on secondment to another department or a private organization.
The following table presents details of accounts receivable and advances:
(in thousands of dollars)20092008
Interest and service fees on loans640640
Receivables from other Federal Government
departments and agencies
2,3532,989
Receivables from external parties6,6627,126
Accountable and standing advances74113
Sub-total9,72910,868
Less: Allowance for doubtful accounts on
receivables from external parties, and on interest
and service fees on loans
(5,822)(5,921)
Total3,9074,947

7. Loans to developing countries and International Financial Institutions

The following table presents details of loans to developing countries and International Financial Institutions:
(in thousands of dollars)20092008
(a) 30 year term, 7 year grace period, unsecured, 3 percent interest per annum, with the final repayment in March 2005:
Cuba9,5479,547
(b) 35 year term, 4 year grace period, unsecured, 5 percent interest per annum, semi-annual interest repayments with first principal repayment due January 2017 and final repayment in July 2026:
Egypt44,99644,996
(c) 50 year term, 10 year grace period, unsecured, non-interest bearing, with final repayments between March 2015 and September 2035:
African Development Bank1,4691,594
Algeria6,1756,614
Andean Development Corporation1,8131,937
Argentina149168
Bolivia551594
Brazil209230
Central American Bank for Economic Integration650727
Chile784932
Colombia237263
Dominican Republic3,4143,650
Ecuador3,8904,152
Guatemala1,7811,881
Indonesia174,489185,480
Malaysia1,4201,483
Malta375400
Mexico2225
Morocco6,6227,208
Myanmar (Burma)8,3068,306
Pakistan447,508447,508
Paraguay160180
Peru3437
Philippines1,5491,646
Sri Lanka81,03986,578
Thailand17,09317,940
Tunisia48,58451,887
(d) 53 year term, 13 year grace period, unsecured, non-interest bearing, with the final repayment in September 2025:
Algeria17,43118,676
Subtotal880,297904,639
Less:  
Unamortized discount(558,563)(596,976)
Subtotal321,734307,663
Less:  
Allowance for valuation(178,736)(147,845)
Total142,998159,818

The grace period refers to interval from date of issuance of the loan to first repayment of loan principal.

The loan with the Philippines was issued in Canadian dollars. However, it is reimbursable in Philippine pesos in equivalent Canadian dollar semi-annual installments of 48,580 until September 2024. The installments are converted to Philippine pesos using the foreign exchange rate in effect at the time of repayment.

In 2006-07, the Government of Canada, as represented by CIDA, entered into an agreement with the Government of Pakistan to forgive its outstanding 447,000,000 loan. In order to expire its debt obligation, the Government of Pakistan will be required to make education sector investments that are equivalent to the current present value of its debt (117,400,000). According to the agreement, these investments are to be made over a five-year period, and Pakistan's debt is to be written down proportionally by CIDA as the investments are made. Debt will be forgiven proportionally once CIDA obtains necessary authorities.

8. Investments and advances to International Financial Institutions

The following table presents details of investments and advances to International Financial Institutions:
(in thousands of dollars)20092008
Investments  
African Development Bank120,055109,460
Asian Development Bank192,608162,609
Caribbean Development Bank23,36420,177
Inter-American Development Bank226,406184,876
Investments - subtotal562,433477,122
Advances  
African Development Fund2,033,8031,915,393
Asian Development Bank-Special27,02727,027
Asian Development Fund1,972,0541,921,547
Caribbean Development Bank-
Agricultural Development Fund
2,0002,000
Caribbean Development Bank-
Commonwealth Caribbean Regional
5,0454,106
Caribbean Development Bank-Special217,465200,933
Global Environment Facility Trust Fund467,013428,410
Inter-American Development Bank-
Fund for Special Operations
382,283338,934
Multilateral Investment Fund33,49027,173
International Bank for Reconstruction and Development25,22620,530
International Fund for Agriculture Development229,383216,958
International Monetary Fund13,83611,260
Montreal Protocol Mutilateral Fund83,49472,434
Advances - subtotal5,492,1195,186,705
Subtotal investments and advances6,054,5525,663,827
Less:  
Allowance for valuation(6,054,552)(5,663,827)
Total--

The allowance for valuation reduces the net realizable value of the investments and advances to International Financial Institutions to zero, as it is not expected that CIDA will recover these investments and advances in the future.

9. Canada Investment Fund for Africa (CIFA)

The CIFA is a joint public-private sector initiative designed to provide risk capital for private investments in Africa that generate growth. The CIFA is a direct response to the New Partnership for Africa's Development (NEPAD) and the G8 Africa Action Plan. The main objectives of the CIFA are to optimize public-private investment in the Fund, to confer a beneficial development impact on Africa by way of increased foreign direct investment and to optimize the beneficial impact of the Fund's activities on Canadian interests.

The Government of Canada is a limited partner in the CIFA and its commitment towards the Fund was subject to matching funds of other investors and was to be equal to the lesser of: (i) 100M and (ii) the aggregated commitments of all other limited partners of the partnership. The investment period in the CIFA ended January 1, 2009. From thereon, and until the term of the partnership is reached on December 31, 2013, CIDA will only receive income and returns of capital.

The following table presents details of the Canada Investment Fund for Africa:
(The CIFA is presented at cost)
(in thousands of dollars)20092008
Cumulated payments as at March 31*100,000100,000
Cumulated returns of capital as at March 31(9,601)(5,027)
Accrued liability as at March 31-5,027
Total90,399100,000

* including gain on foreign exchange rates since 2005

10. Tangible capital assets

(in thousands of dollars)

(a) Cost:

Capital asset classOpening balanceAcquisitionsDisposals & write-offsClosing balance
Communication equipment845--845
Informatic equipment10,794254-11,048
Computer software51--51
Other equipment1,585--1,585
Vehicles1575331179
Assets under construction-2,138-2,138
Total13,4322,4453115,846
(b) Accumulated amortization:

Capital asset classOpening balanceAcquisitionsDisposals & write-offsClosing balance
Communication equipment63677-713
Informatic equipment9,012665-9,677
Computer software2810-38
Other equipment1,135332-1,467
Vehicles7214779
Assets under construction----
Total10,8831,098711,974

Amortization expenses for the year ended on March 31, 2009 is 1,098,000 ( 1,088,000 in 2008).

(c) Net book value:

Capital asset class20092008
Communication equipment132209
Informatic equipment1,3711,782
Computer software1323
Other equipment118450
Vehicles10085
Assets under construction2,138-
Total3,8722,549

11. Accounts payable and accrued liabilities

The following table presents details of accounts payable and accrued liabilities:

(in thousands of dollars)20092008
Accounts payable:  
Multilateral387,117163,951
Civil Society136,10593,954
Governmental5,5729,915
Individual1,4531,836
Para-governmental821118
Employees114254
Subtotal Accounts payable531,182270,028
Accrued liabilities21,12217,326
Contractor's holdback12,5919,456
Accrued salaries4,9044,173
Subtotal liabilities38,61730,955
Total569,799300,983

12. Notes payable to International Financial Institutions

The following table presents details of notes payable to International Financial Institutions:

(in thousands of dollars)20092008
Investments  
Caribbean Development Bank-7,506
Advances  
Asian Development Fund-1,144
Global Environment Facility Trust Fund9,76320,141
Subtotal9,76321,285
Total9,76328,791

Investments
During the year, note encashments amounted to 8,004,000 (0 in 2008), net of a loss on foreign exchange of 498,000.

Advances
During the year, note issuances amounted to 227,957,000 (215,911,000 in 2008) and note encashments amounted to 239,479,000 (302,725,000 in 2008) for a net decrease of notes payables of 11,522,000.

13. Employee Benefits

(a) Pension benefits: CIDA's 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 the Canada/Quebec Pension Plans benefits and they are indexed to inflation.

Both the employees and the Agency contribute to the cost of the Plan. The 2008-2009 expense amounts to 18,089,000 (17,223,000 in 2007-2008), which represents approximately 2.0 times (2.1 in 2007-2008) the contributions by employees.

CIDA'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.

(b) Severance benefits: CIDA provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations.

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

(in thousands of dollars)20092008
Accrued benefit obligation, beginning of year33,08131,184
Expense for the year9,2794,822
Benefits paid during the year(2,949)(2,925)
Accrued benefit obligation, end of year39,41133,081

14. Other liabilities

Other liabilities consist of funds received from external organizations to carry out specific aid projects and to be administered by CIDA on their behalf.

In 2008-2009, the primary liability of this nature was a contribution received from the Government of the Netherlands, acting through the Netherlands Minister for Development Cooperation, to provide significant resources to the education sector in Nicaragua.

Information about the other liabilities, measured as at March 31, is as follows:

(in thousands of dollars)20092008
Other liabilities, beginning of year1,8405,815
Amounts received during the year14,64111,339
Amounts disbursed during the year(15,481)(15,314)
Other liabilities, end of year1,0001,840

15. Contingent liabilities

(a) Callable share capital:

CIDA is liable for callable share capital in certain international organizations that could require future payments to those organizations. Callable share capital is composed of resources that are not paid to the organizations but act as a guarantee to allow them to borrow on international capital markets to finance their lending program. Callable share capital, which has never been drawn on by the organizations, would only be utilized in extreme circumstances to repay unrecoverable loans, should the organization's reserves not be sufficient. As at March 31, 2009, the callable share capital is valued at 8.7 billion and no provision was recorded for this amount.

However, different methods are used by CIDA and by the Asian Development Bank (ADB) to calculate the value of CIDA's callable shares for disclosure as a contingent liability. CIDA uses the US foreign exchange rate at the time of the investments and revalues its shares at the end of every fiscal year using the year-end US exchange rate. On the basis of this method, CIDA's valuation of its ADB callable shares is 2,530,815,000 as at March 31, 2009. However, ADB decided to use the Special Drawing Right (SDR) for purposes of denominating its capital in lieu of the US dollar. The value of the SDR against the US and Canadian dollar exchange rates at the time of inception was used to establish the par value of SDR. This par value of CIDA's callable shares is then translated using the latest exchange rate of SDR against the US and Canadian dollar exchange rates. Valuation of these callable shares on this basis amounts to 3,242,990,000, representing a difference of 712,175,000 with CIDA's own valuation as at March 31, 2009.

(b) Litigation cases:

CIDA is a defendant in certain pending and threatened litigation cases which arose in the normal course of operations. Legal proceedings for claims totalling approximately
1,100,000 (400,000 in 2008) were still pending as at March 31, 2009. Some of these potential liabilities 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 in the financial statements.

16. Contractual obligations

The nature of CIDA's activities results in multi-year contracts and obligations whereby CIDA will be obligated to make future payments when the services/goods are received.

Significant contractual obligations that can be reasonably estimated are summarized as follows:
(in thousands of dollars)20102011201220132014 and thereafterTotal
Transfer payments1,479,9661,137,306550,771279,651208,9283,656,622
Professional services11,2453,03048--14,323
Operating leases1,075185163105191,547
Encashment of notes by International Financial Institutions141,053143,3873,165--287,605
Total1,633,3391,283,908554,147279,756208,9473,960,097

17. Related party transactions

CIDA is related as a result of common ownership to all Government of Canada departments, agencies and Crown corporations. CIDA enters into transactions with these entities in the normal course of business and on normal trade terms. Throughout the year, the agency received services that were obtained without charge from other Government departments as presented in part (a).

(a) Services received without charge:

During the year, CIDA received without charge from other departments the following: accommodation, administrative services pertaining to workers' compensation claims, legal fees and the employer's contribution to the health and dental insurance plans.

These services without charge have been recognized in CIDA's Statement of Operations as follows:

(in thousands of dollars)20092008
Employer's contribution to the health
and dental insurance plans
12,6329,921
Accommodation8,6578,371
Legal services562548
Administrative charges pertaining to workers'
compensation claims
9398
Total21,94418,938

The Government has structured some of its administrative activities for efficiency and cost-effectiveness purposes so that one department performs these activities on behalf of all, without charge. The costs of some of these services, notably the payroll and cheque issuance services provided by Public Works and Government Services Canada, are not included as an expense in CIDA's Statement of Operations.

(b) Payables and receivables outstanding at year-end with related parties:

(in thousands of dollars)20092008
Accounts receivable with other government departments2,3532,989
Accounts payable with other government departments5,5729,915

18. Correction of error

During the year, a review of the calculations related to the net present value of loans to developing countries was undertaken. As a result of this review, an adjustment of 25,000,000 was made to the carrying value of loans due to errors identified in the historical calculations. The full amount was recorded as revenue in the current fiscal year, by including it in the amortization of discount on loans.

19. Comparative information

Where applicable, comparative figures have been reclassified to conform to the current year's presentation.

Footnotes

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