Financial Statements of Transport Canada (Unaudited) For the year ended March 31, 2018

Transport Canada

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, 2018, and all information contained in these financial statements rests with the management of Transport Canada. These financial statements have been prepared by management using the Government of Canada'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 Transport Canada's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in Transport Canada's Departmental Results 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 Transport Canada 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, 2018 was completed in accordance with the Treasury Board Policy on Financial Management and the results and action plans are summarized in the annex.

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

The financial statements of Transport Canada have not been audited.

Original signed by

Thao Pham, Acting as Deputy Minister
Ottawa, Canada

August 27, 2018

Date

 

Original signed by

André Lapointe, Chief Financial Officer
Ottawa, Canada

August 21, 2018

Date

 

TRANSPORT CANADA

Statement of Financial Position (Unaudited)
As at March 31

(in thousands of dollars)

 

2018

2017

Liabilities

Accounts payable and accrued liabilities (note 4)

584,729

640,907

Vacation pay and compensatory leave

33,170

26,920

Environmental liabilities (note 5)

171,038

198,378

Deferred revenue (note 6)

5,920

3,745

Lease obligation for tangible capital assets (note 7)

464,037

487,038

Employee future benefits (note 8)

24,239

24,062

Contingent liabilities (note 15)

9,750

54,750

Total net liabilities

1,292,883

1,435,800

Financial assets

Due from Consolidated Revenue Fund

500,629

568,363

Accounts receivable and advances (note 9)

35,703

24,106

Loans receivable (note 10)

1,839

1,795

Total gross financial assets

538,171

594,264

Financial assets held on behalf of Government

Accounts receivable and advances (note 9)

(22,147)

(15,009)

Loans receivable (note 10)

(1,839)

(1,795)

Total financial assets held on behalf of Government

(23,986)

(16,804)

Total net financial assets

514,185

577,460

Departmental net debt

778,698

858,340

Non-financial assets

Prepaid expenses

3,614

3,341

Consumable parts (note 11)

13,340

12,314

Tangible capital assets (note 12)

2,789,024

2,773,281

Total non-financial assets

2,805,978

2,788,936

Departmental net financial position (note 13)

2,027,280

1,930,596

Contractual obligations and contractual rights (note 14)
Contingent liabilities and contingent assets (note 15)

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

Original signed by

Thao Pham, Acting as Deputy Minister
Ottawa, Canada

August 27, 2018

Date

 

Original signed by

André Lapointe, Chief Financial Officer
Ottawa, Canada

August 21, 2018

Date

 

TRANSPORT CANADA

Statement of Operations and Departmental Net Financial Position (Unaudited)
For the Year Ended March 31

(in thousands of dollars)

 

2018
Planned
Results

2018

2017

Expenses

A Safe and Secure Transportation System

515,498

554,932

470,788

An Efficient Transportation System

640,270

419,201

557,860

Internal Services

171,411

174,503

165,407

A Clean Transportation System

70,743

88,422

94,652

Specified purpose accounts (note 13)

1,496

4,062

5,222

Expenses incurred on behalf of Government

(1,496)

(4,062)

(5,222)

Total expenses

1,397,922

1,237,058

1,288,707

Revenues

Leases of property

343,607

374,808

348,892

Monitoring and enforcement revenues

51,065

47,738

48,873

Aircraft maintenance and flying services

26,160

27,581

25,442

Rentals and concessions

19,840

24,055

26,008

Specified purpose accounts (note 13)

3,608

23,332

8,302

Transport facilities user fees

13,381

14,731

12,309

Other

3,699

3,370

3,022

Revenues earned on behalf of Government

(391,086)

(442,446)

(399,584)

Total revenues

70,274

73,169

73,264

Net cost from continuing operations

1,327,648

1,163,889

1,215,443

Government funding and transfers

Net cash provided by Government of Canada

 

1,237,377

1,073,069

Change in due from Consolidated Revenue Fund

 

(67,734)

109,758

Services provided without charge by other government departments (note 16)

 

 

96,615

 

90,421

Transfer of assets to other government departments (note 12 and note 17)

 

 

(5,685)

 

(67,196)

Net cost of operations after government funding and transfers

 

(96,684)

9,391

Departmental net financial position – Beginning of year

 

1,930,596

1,939,987

Departmental net financial position – End of year

 

2,027,280

1,930,596

Segmented information (note 18)

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

TRANSPORT CANADA

Statement of Change in Departmental Net Debt (Unaudited)
For the Year Ended March 31

(in thousands of dollars)

 

2018

2017

Net cost of operations after government funding and transfers

(96,684)

9,391

Change due to tangible capital assets

Acquisitions of tangible capital assets (note 12)

154,993

180,772

Amortization of tangible capital assets (note 12)

(137,391)

(145,439)

Proceeds from disposal of tangible capital assets

(24,171)

(7,455)

Net gain on disposal of tangible capital assets (note 18)

21,240

4,831

Adjustments to assets under construction (note 12(a))

6,757

546

Transfer to other government departments (note 17)

(5,685)

(67,196)

Total change due to tangible capital assets

15,743

(33,941)

Change due to consumable parts (note 11)

1,026

14

Change due to prepaid expenses

273

1,972

Net decrease in departmental net debt

(79,642)

(22,564)

Departmental net debt – Beginning of year

858,340

880,904

Departmental net debt – End of year

778,698

858,340

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

TRANSPORT CANADA

Statement of Cash Flows (Unaudited)
For the Year Ended March 31

(in thousands of dollars)

 

2018

2017

Operating activities

Net cost of operations before government funding and transfers

1,163,889

1,215,443

Non-cash items:

Amortization of tangible capital assets (note 12)

(137,391)

(145,439)

Adjustments to assets under construction (note 12(a))

6,757

546

Services provided without charge by other government departments (note 16)

(96,615)

(90,421)

Gain on disposal of tangible capital assets (note 18)

21,240

4,831

Variations in Statement of Financial Position:

Increase (decrease) in accounts receivable and advances (note 9)

4,459

(8,447)

Increase (decrease) in prepaid expenses

273

1,972

Increase (decrease) in consumable parts (note 11)

1,026

14

Decrease (increase) in accounts payable and accrued liabilities (note 4)

56,178

(98,963)

Increase in vacation pay and compensatory leave

(6,250)

(710)

Decrease (increase) in environmental liabilities (note 5)

27,340

(9,978)

Decrease (increase) in deferred revenue (note 6)

(2,175)

5,993

Decrease (increase) in employee future benefits (note 8)

(177)

912

Decrease in contingent liabilities (note 15)

45,000

2,000

Cash used in operating activities

1,083,554

877,753

Capital investing activities

Acquisitions of tangible capital assets (note 12)

154,993

180,772

Proceeds from disposal of tangible capital assets

(24,171)

(7,455)

Cash used in capital investing activities

130,822

173,317

Financing activities

Decrease in lease obligation for tangible capital assets (note 7)

23,001

21,999

Cash used in financing activities

23,001

21,999

Net cash provided by Government of Canada

1,237,377

1,073,069

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

TRANSPORT CANADA
Notes to the Financial Statements (Unaudited)
For the Year Ended March 31

1. Authority and objectives

Transport Canada is a department of the Government of Canada named in Schedule 1 of the Financial Administration Act and reports to Parliament through the Minister of Transport.

Transport Canada is responsible for the transportation policies, programs and goals set by the Government of Canada, which are supported through the following departmental programs:

  • An Efficient Transportation System: supports trade, economic prosperity and a better quality of life through low costs, reliable service, the best use of all modes and innovation in transportation. Transport Canada promotes an efficient transportation system in Canada by: modernizing marketplace frameworks so that the transportation sector can adapt, innovate and remain competitive; implementing trade corridor initiatives; ensuring the renewal of federal transportation infrastructure; encouraging innovation in the transportation sector; and partnering with provinces, territories, municipal governments, and public and private sector entities in various transportation initiatives.
  • A Clean Transportation System: advances the federal government's environmental agenda in the transportation sector and complements other federal programs designed to reduce air emissions to protect the health of Canadians and the environment for generations to come; protects the marine environment by reducing the pollution of water from transportation sources; and fulfills Transport Canada's responsibilities in working towards a cleaner and healthier environment with regard to its own operations.
  • A Safe and Secure Transportation System: moves people and goods across Canada, and to international destinations, without loss of life, injury, or damage to property. Transport Canada supports a safe and secure transportation system by influencing the behaviour of the public and industry through policies, standards, regulations and laws. Harmonized and streamlined regulatory regimes, informed by the practices of multiple countries and stakeholders, promote effective, safe and secure transportation operations and a sound safety and security culture. Transport Canada ensures that Canadians and the transportation industry are in compliance with the regulatory framework through its oversight program.
  • Internal Services: Internal Services are groups of related activities and resources that the federal government considers to be services in support of programs and/or required to meet corporate obligations of an organization. Internal Services refers to the activities and resources of the 10 distinct service categories that support Program delivery in the organization, regardless of the Department's Internal Services delivery model. The 10 service categories are: Management and Oversight Services; Communications Services; Legal Services; Human Resources Management Services; Financial Management Services; Information Management Services; Information Technology Services; Real Property Services; Materiel Services; and Acquisition Services.

Transport Canada delivers its programs and services under numerous legislative and constitutional authorities including Department of Transport Act, Canada Transportation Act, Aeronautics Act, Canada Marine Act, Marine Liability Act, Canada Shipping Act, Navigation Protection Act, Railway Safety Act, Transportation of Dangerous Goods Act, Motor Vehicle Safety Act, Canadian Air Transport Security Authority Act, Marine Transportation Security Act and Safe and Accountable Rail Act.

2. Summary of significant accounting policies

These financial statements are prepared using Transport Canada's accounting policies stated below, 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:

  1. Parliamentary authorities
    Transport Canada is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to Transport Canada do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements.Consequently, items recognized in the Statement of Operations and Departmental Net Financial Position and in the Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament. Note3 provides a reconciliation between the bases of reporting. The planned results amounts in the “Expenses” and “Revenues” sections of the Statement of Operations and Departmental Net Financial Position are the amounts reported in the Future-oriented Statement of Operations included in the 2017-18 Departmental Plan. Planned results are not presented in the “Government funding and transfers” section of the Statement of Operations and Departmental Net Financial Position and in the Statement of Change in Departmental Net Debt because these amounts were not included in the 2017-18 Departmental Plan.

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

  3. Amounts due from or to the CRF
    Amounts due from or to the CRF are the result of timing differences at year-end between when a transaction affects authorities and when it is processed through the CRF. Amounts due from the CRF represent the net amount of cash that Transport Canada is entitled to draw from the CRF without further authorities to discharge its liabilities.

  4. Revenues
    Revenues from regulatory fees are recognized in the accounts based on the services provided in the year. Funds received from external parties for specified purposes are recorded upon receipt as deferred revenue.

    Revenues are then 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 Transport Canada's liabilities. While the Deputy Head is expected to maintain accounting control, he or she has no authority regarding 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 entity's gross revenues.

  5. 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.

    Vacation pay and compensatory leave are accrued as the benefits are earned by employees under their respective terms of employment.

    Services provided without charge by other government departments for accommodation, employer contributions to the health and dental insurance plans, legal services and workers' compensation are recorded as operating expenses at their carrying value.

  6. Employee future benefits

    1. Pension benefits―Eligible employees participate in the Public Service Pension Plan (the “Plan”), a multi-employer pension plan administered by the Government of Canada. Transport Canada's contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. Transport Canada'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.
    2. Severance benefits―The accumulation of severance benefits for voluntary departures ceased for applicable employee groups. The remaining obligation for employees who did not withdraw benefits is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.
  7. Accounts and loans receivable
    Accounts and loans receivable are initially recorded at cost and where necessary, are discounted to reflect their concessionary terms. Concessionary terms of loans include cases where loans are made on a long-term, low interest or interest-free basis. Transfer payments that are unconditionally repayable are recognized as loans receivable. When necessary, an allowance for valuation is recorded to reduce the carrying value of accounts and loans receivable to amounts that approximate their net recoverable value.

  8. Non-financial assets
    The costs of acquiring land, buildings, equipment and other capital property are capitalized as tangible capital assets and, except for land, are amortized to expense over the estimated useful lives of the assets, as described in Note 12. All tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. Tangible capital assets do not include immovable assets located on reserves as defined in the Indian Act, works of art, museum collections and Crown land to which no acquisition cost is attributable, and intangible assets.

    Inventories are valued at cost and are comprised of spare parts and supplies held for future program delivery and are not primarily intended for resale. Inventories that no longer have service potential are valued at the lower of cost or net realizable value.

  9. Contingent liabilities
    Contingent liabilities are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, a provision is accrued and an expense recorded to other expenses. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.

  10. Contingent assets
    Contingent assets are possible assets which may become actual assets when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, the contingent asset is disclosed in the notes of the financial statements.

  11. Environmental liabilities
    An environmental liability for the remediation of contaminated sites is recognized when all of the following criteria are satisfied: an environmental standard exists, contamination exceeds the environmental standard, the Government is directly responsible or accepts responsibility, it is expected that future economic benefits will be given up and a reasonable estimate of the amount can be made. The liability reflects the Government's best estimate of the amount required to remediate the sites to the current minimum standard for their use prior to contamination. When the future cash flows required to settle or otherwise extinguish a liability are estimable, predictable and expected to occur over extended future periods, a present value technique is used. The discount rate used reflects the Government's cost of borrowing, associated with the estimated number of years to complete remediation.

    The recorded liabilities are adjusted each year, for present value adjustments, inflation, new obligations, changes in management estimates and actual costs incurred.

    If the likelihood of the Government's responsibility is not determinable, a contingent liability is disclosed in the notes to the consolidated statements.

  12. Transactions involving foreign currencies
    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 at March 31st. Gains and losses resulting from foreign currency transactions are reported on the Statement of Operations and Departmental Net Financial Position according to the activities to which they relate.

  13. Measurement uncertainty
    The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements and accompanying notes as at March 31st. The estimates are based on facts and circumstances, historical experience, general economic conditions and reflect the Government's best estimate of the related amount at the end of the reporting period. The most significant items where estimates are used are contingent liabilities, environmental liabilities, the liability for employee future benefits and the useful life of capital assets. 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.

    Environmental liabilities are subject to measurement uncertainty as discussed in Note 5 due to the evolving technologies used in the estimation of the costs for remediation of contaminated sites, the use of discounted present value of future estimated costs, and the fact that not all sites have had a complete assessment of the extent and nature of remediation. Changes to underlying assumptions, the timing of the expenditures, the technology employed, or the revisions to environmental standards or changes in regulatory requirements could result in significant changes to the environmental liabilities recorded.

  14. Related party transactions
    Related party transactions, other than inter-entity transactions, are recorded at the exchange amount.

    Inter-entity transactions are transactions between commonly controlled entities. Inter-entity transactions, other than restructuring transactions, are recorded on a gross basis and are measured at the carrying amount, except for the following:

    1. Services provided on a recovery basis are recognized as revenues and expenses on a gross basis and measured at the exchange amount.
    2. Certain services received on a without charge basis are recorded for departmental financial statement purposes at the carrying amount.
3. Parliamentary authorities

Transport Canada receives most of its funding through annual parliamentary authorities. Items recognized in the Statement of Operations and Departmental Net Financial Position and the Statement of Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, Transport Canada 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 authorities used

 

2018

2017

 

(in thousands of dollars)

Net cost of operations before government funding and transfers

1,163,889

1,215,443

Adjustments for items affecting net cost of operations but not affecting authorities:

Amortization of tangible capital assets (note 12)

(137,391)

(145,439)

Services provided without charge by other government departments
(note 16)

(96,615)

(90,421)

Gain on disposal of tangible capital assets (note 18)

21,240

4,831

Adjustments to assets under construction (note 12(a))

6,757

546

Increase in vacation pay and compensatory leave

(6,250)

(710)

Decrease (increase) in environmental liabilities (note 5)

27,340

(9,978)

Decrease (increase) in employee future benefits (note 8)

(177)

912

Decrease in contingent liabilities (note 15)

45,000

2,000

Decrease (increase) in accrued liabilities not charged to authorities

(702)

6,596

Refund of prior years' expenditures

701

998

Adjustments of previous years accounts payable

1,312

1,090

Bad debt expense

22

(274)

Other expenditures not affecting authorities

(850)

188

Total items affecting net cost of operations but not affecting
authorities

(139,613)

(229,661)

Adjustments for items not affecting net cost of operations but affecting authorities:

Acquisitions of tangible capital assets (note 12)

154,993

180,772

Decrease in lease obligations for tangible capital assets (note 7)

23,001

21,999

Increase in consumable parts (note 11)

1,026

14

Increase in prepaid expenses

273

1,972

Other

2,151

620

Total items not affecting net cost of operations but affecting authorities

181,444

205,377

Current year authorities used

1,205,720

1,191,159

(b) Authorities provided and usedFootnote 1

 

2018

2017

 

(in thousands of dollars)

Authorities provided:

Vote 1 – Operating expenditures

723,506

605,978

Vote 5 – Capital expenditures

163,553

151,178

Vote 10 – Grants and contributions – Gateways and corridors

113,277

257,904

Vote 15 – Grants and contributions – Transportation infrastructure

278,421

195,547

Vote 20 – Grants and contributions – Other

55,323

50,415

Statutory amounts

150,621

190,705

Total authorities provided

1,484,701

1,451,727

Less:

Authorities available for future years

(179)

(3,015)

Lapsed: Operating expenditures

(45,238)

(71,042)

Lapsed: Capital expenditures

(63,526)

(61,640)

Lapsed: Grants and contributions – Gateways and corridors

(54,287)

(100,729)

Lapsed: Grants and contributions – Transportation infrastructure

(92,050)

(5,690)

Lapsed: Grants and contributions – Other

(23,701)

(18,257)

Lapsed: Other lapsed amounts

-

(195)

Current year authorities used

1,205,720

1,191,159

4. Accounts payable and accrued liabilities

The following table presents details of Transport Canada's accounts payable and accrued liabilities.

 

2018

2017

 

(in thousands of dollars)

Accounts payable – Other government departments and agencies

47,914

62,169

Accounts payable – External parties

458,933

509,516

Total accounts payable

506,847

571,685

Accrued liabilities

77,882

69,222

Total accounts payable and accrued liabilities

584,729

640,907

5. Environmental liabilities

Remediation of contaminated sites

The Government's “Federal Approach to Contaminated Sites” sets out a framework for management of contaminated sites using a risk-based approach. Under this approach the Government has inventoried the contaminated sites identified on federal lands, allowing them to be classified, managed and recorded in a consistent manner. This systematic approach aids in identification of the high risk sites in order to allocate limited resources to those sites which pose the highest risk to human health and the environment.

Transport Canada has identified approximately 298 sites (286 sites in 2016-2017) where contamination may exist and assessment, remediation and monitoring may be required. Of these, Transport Canada has identified approximately 96 sites (109 sites in 2016-2017) where action is required and for which a gross liability of $146,526 thousand ($178,627 thousand in 2016-2017) has been recorded. This liability estimate has been determined based on site assessments performed by environmental experts.

In addition, a statistical model is applied to a group of unassessed sites in order to estimate both the number of sites that are likely to be remediated, and the associated expense based on consideration of current and historical costs. Of the 70 unassessed sites considered (70 sites in 2016-2017), the model predicted that 48 sites (49 sites in 2016-2017) would ultimately be remediated at an estimated cost of $24,512 thousand ($19,751 thousand in 2016-2017).

These two liability estimates combined, totalling $171,038 thousand ($198,378 thousand in 2016-2017) represent management's best estimate of the costs required to remediate the sites to the current minimum standard for their use prior to contamination, based on information available at the financial statement date.

For the remaining 154 sites (128 sites in 2016-2017), no liability for remediation has been recognized. Some of these sites are at various stages of testing and evaluation and if remediation is required, liabilities will be reported as soon as a reasonable estimate can be determined. For other sites, Transport Canada does not expect to give up any future economic benefits (there is likely no significant environmental impact or human health threats). These sites will be re-examined and a liability for remediation will be recognized if future economic benefits will be given up.

The following table presents the total estimated amounts of these liabilities by nature and source, the associated expected recoveries and the total undiscounted future expenditures as at March 31, 2018, and March 31, 2017. When the liability estimate is based on a future cash requirement, the amount is adjusted for inflation using a forecast CPI rate of 1.9% (2% in 2017). Inflation is included in the undiscounted amount. The Government of Canada's cost of borrowing by reference to the actual zero-coupon yield curve for Government of Canada bonds has been used to discount the estimated future expenditures. The March 2018 rates range from 1.79% (0.76% in 2016-2017) for 2 year term to 2.24% (2.39% in 2016-2017) for a 30 or greater year term.

Also, 7 sites were closed during the year (22 sites in 2016-2017) as they were either remediated or assessed to confirm that they no longer meet all the criteria required to record a liability for contaminated sites.

Nature and Source of Liability

 

2018

2017

Nature & Source

Total Number of Sites

Number of Sites with a Liability

Estimated Liability

Estimated Total Undiscounted Expenditures

Total Number of Sites

Number of Sites with a Liability

Estimated Liability

Estimated Total Undiscounted Expenditures

 

(in thousands of dollars)

(in thousands of dollars)

Military & Former Military SitesFootnote 1

6

1

182

190

6

1

143

145

Fuel Related Practices Footnote 2

61

25

24,589

26,423

60

28

28,700

30,210

Landfill/Waste SitesFootnote 3

24

11

33,761

36,216

21

14

38,495

40,338

Engineered Asset/Air & Land TransportationFootnote 4

69

44

28,965

30,293

69

44

28,631

29,705

Marine Facilities/Aquatic SitesFootnote 5

76

41

81,556

89,013

72

45

101,128

105,621

OtherFootnote 6

62

22

1,985

2,138

58

26

1,281

1,426

Totals

298

144

171,038

184,273

286

158

198,378

207,445

6. Deferred revenue

Deferred revenue represents the balance at year-end of unearned revenues stemming from amounts received from external parties that are restricted in order to fund the expenditures related to specific research projects and stemming from amounts received for fees prior to services being performed. Revenue is recognized in the period in which these expenditures are incurred or in which the service is performed. Details of the transactions related to this account are as follows:

 

2018

2017

 

(in thousands of dollars)

Shared-cost agreementsFootnote *

Opening balance

646

6,452

Amounts received

3,325

702

Revenue recognized

(1,385)

(6,508)

Closing balance

2,586

646

Other

Opening balance

3,099

3,286

Amounts received

2,937

2,573

Revenue recognized

(2,702)

(2,760)

Closing balance

3,334

3,099

Net closing balance

5,920

3,745

7. Lease obligation for tangible capital assets

Under the Northumberland Strait Crossing Act, the Government of Canada entered into a long-term capital lease arrangement in 1992 and is obligated to pay an annual subsidy of $41,900 thousand indexed to the annual inflation rate to the Strait Crossing Finance Inc., a wholly owned corporation of the Province of New Brunswick, for the construction of the Confederation Bridge.

The annual payments made by Transport Canada are due on April 1 and will be used to retire $661,543 thousand of 4.5% real rate bonds issued in October 1993 by Strait Crossing Finance Inc. to finance the construction of the bridge. Annual payments made by Transport Canada began in 1997 and will continue until 2033. At such time, the ownership of the bridge will be transferred to the Government of Canada.

On April 1, 2017, an annual payment in the amount of $64,942 thousand ($63,588 thousand in 2016-2017) was made. This payment represents a payment of principal in the amount of $23,001 thousand ($21,999 thousand in 2016-2017), interest of $22,173 thousand ($23,175 thousand in 2016-2017), and an amount of $19,768 thousand ($18,414 thousand in 2016-2017) representing the indexing of the payment to the annual inflation rate.

The interest expense and indexing adjustment accrued at March 31, 2018 amounts to $21,126 thousand ($22,173 thousand in 2016-2017) and $20,872 thousand ($19,769 thousand in 2016-2017), respectively.

Transport Canada has a capital lease obligation of $464,037 thousand at March 31, 2018 ($487,037 thousand in 2016-2017), based on the present value for the future payments using an interest rate of 6.06% (6.06% in 2016-2017).

The obligations related to the upcoming years include the following:

 

2018

 

(in thousands of dollars)

2019

62,920

2020

63,871

2021

64,836

2022

65,815

2023

66,809

2024 and thereafter

584,695

Total future minimum lease payments

908,946

Less: imputed interest (6.06%)

(444,909)

Balance of obligations under leased tangible capital assets

464,037

8. Employee future benefits
  1. Pension benefits

    Transport Canada's employees participate in the Public Service Pension Plan (the “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 Canada/Québec Pension Plan benefits and they are indexed to inflation.

    Both the employees and Transport Canada contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to Economic Action Plan 2012, employee contributors have been divided into two groups – Group 1 relates to existing plan members as of December 31, 2012 and Group 2 relates to members joining the Plan as of January 1, 2013. Each group has a distinct contribution rate.

    The 2017-2018 expense amounts to $62,944 thousand ($56,968 thousand in 2016-2017). For Group 1 members, the expense represents approximately 1.01 times (1.12 times in 2016-2017) the employee contributions and, for Group 2 members, approximately 1.00 times (1.08 times in 2016-2017) the employee contributions.

    Transport Canada's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the Consolidated Financial Statements of the Government of Canada, as the Plan's sponsor.

  2. Severance benefits

    Severance benefits provided to Transport Canada's employees were previously based on an employee's eligibility, years of service and salary at termination of employment. However, since 2011 the accumulation of severance benefits for voluntary departures progressively ceased for substantially all employees. Employees subject to these changes were given the option to be paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits upon departure from the public service. By March 31, 2018, substantially all settlements for immediate cash out were completed. Severance benefits are unfunded and, consequently, the outstanding obligation will be paid from future authorities.

    The changes in the obligations during the year were as follows:

 

2018

2017

 

(in thousands of dollars)

Accrued benefit obligation - Beginning of year

24,062

24,974

Expense for the year

3,970

2,508

Benefits paid during the year

(3,793)

(3,420)

Accrued benefit obligation - End of year

24,239

24,062

9. Accounts receivable and advances

The following table presents details of Transport Canada's accounts receivable and advances balances:

 

2018

2017

 

(in thousands of dollars)

Receivables – Other government departments and agencies

11,774

13,906

Receivables – External parties

21,455

11,859

Employee advances

3,120

807

Subtotal

36,349

26,572

Allowance for doubtful accounts on receivables from external parties

(646)

(2,466)

Gross accounts receivable

35,703

24,106

Accounts receivable held on behalf of Government

(22,147)

(15,009)

Net accounts receivable

13,556

9,097

10. Loans receivable

The following table presents details of Transport Canada's loans receivable:

 

2018

2017

 

(in thousands of dollars)

Loans receivable – Victoria Harbour

2,023

2,066

Loans receivable – St. Lawrence Seaway Management Corporation

174

174

Subtotal

2,197

2,240

Less: Unamortized discount

(184)

(271)

Subtotal

2,013

1,969

Less: Allowance for uncollectibility

(174)

(174)

Gross loans receivable

1,839

1,795

Loans receivable held on behalf of Government

(1,839)

(1,795)

Net loans receivable

-

-

  1. Loans receivable from Victoria Harbour

    The Victoria Harbour loan receivable relates to the sale of a parcel of Victoria Harbour land for $2,578 thousand. A discount of $184 thousand ($271 thousand in 2016-2017) is recorded to reflect the concessionary nature of the loan. A payment of $43 thousand ($43 thousand in 2016-2017) was received in fiscal year 2017-2018.

  2. Loans receivable from St. Lawrence Seaway Management Corporation

    The St. Lawrence Seaway Management Corporation loan portfolio account was established by subsection 80(1) of the Canada Marine Act. Loans previously managed by the St. Lawrence Seaway Authority are now managed by the St. Lawrence Seaway Management Corporation in accordance with an agreement between Transport Canada and the Corporation. The repayments of these loans are recorded in this account. An allowance for uncollectibility has been recorded for the remaining amount of the loans receivable as there is uncertainty of recovering the monies owed.

11. Inventory

 

2018

2017

 

(in thousands of dollars)

Consumable parts

13,340

12,314

Total inventory

13,340

12,314

The cost of consumed inventory recognized as an expense in the Statement of Operations and Departmental Net Financial Position is $2,724 thousand in 2017-2018 ($1,474 thousand in 2016-2017).

12. Tangible capital assets

Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the assets as follows:

Asset Class

Amortization Period

Confederation Bridge Footnote *

100 years

Assets under capital leases

Lease term

Buildings

20 to 40 years

Works and Infrastructure

10 to 60 years

Leasehold improvements

Lease term

Machinery and Equipment

5 to 30 years

Informatics Hardware

3 to 5 years

Informatics Software

3 years

Ships and Boats

10 to 35 years

Aircraft

6 to 20 years

Motor Vehicles

6 to 35 years

Assets under construction are recorded in the applicable asset class in the year they are put into service and are not amortized until they are put into service.

 

Cost

Accumulated Amortization

Net Book Value

Capital Asset Class

Opening Balance

Acquisitions

Adjustments (a)

Disposals and Write-Offs

Closing Balance

Opening Balance

Amortization

Adjustments (a)

Disposals and Write-Offs

Closing Balance

2018

2017

(in thousands of dollars)

LandFootnote 1Footnote 6

211,766

-

(5,421)

(576)

205,769

-

-

-

-

-

205,769

211,766

Confederation Bridge

818,820

-

-

-

818,820

162,399

8,188

-

-

170,587

648,233

656,421

BuildingsFootnote 2Footnote 7

861,415

1,974

39

-

863,428

602,287

30,418

(8,593)

-

624,112

239,316

259,128

Works and InfrastructureFootnote 3Footnote 8

3,455,514

53,987

60,107

(840)

3,568,768

2,168,571

58,425

2,692

(266)

2,229,422

1,339,346

1,286,945

Leasehold ImprovementsFootnote 5

29,858

-

296

-

30,154

16,581

1,118

4

-

17,703

12,451

13,276

Machinery and EquipmentFootnote 4Footnote 9

117,697

3,911

8,308

(118)

129,798

78,276

6,041

4,776

(104)

88,989

40,809

39,421

Informatics Hardware

11,708

21

27

(148)

11,608

5,811

432

-

(133)

6,110

5,498

5,897

Informatics Software

133,674

51

8,271

(152)

141,844

101,878

16,574

-

(152)

118,300

23,544

31,795

Ships and Boats

145,830

-

4,514

(107)

150,237

78,992

2,117

17

(66)

81,060

69,177

66,838

Aircraft

148,743

-

3,319

(695)

151,367

114,558

3,768

-

(608)

117,718

33,649

34,185

Motor Vehicles

465,778

6,878

33

(15,297)

457,392

387,429

10,310

33

(13,673)

384,099

73,293

78,348

Assets under construction

89,260

88,171

(79,492)

-

97,939

-

-

-

-

-

97,939

89,261

Total

6,490,063

154,993

1

(17,933)

6,627,124

3,716,782

137,391

(1,071)

(15,002)

3,838,100

2,789,024

2,773,281

(a) Adjustments include assets under construction of $70,192 thousand that were transferred to the other asset categories upon completion as well as other adjustments to assets under construction of $6,757 thousand ($9,301 thousand that were expensed, offset by $16,058 thousand in other adjustments).

Effective April 1, 2017, Transport Canada transferred land, buildings, and machinery with a net book value of $5,690 thousand to Parks Canada Agency, as well as received capital assets with a net book value of $5 thousand from other government departments. These transfers are included in the adjustment columns (refer to note 17 for further details on the transfers).

National Airport System assets

Land, buildings, works and infrastructures owned by Transport Canada related to the 23 Canadian airports comprising the National Airport System are included in the table above. Tangible capital assets owned by airport authorities are not reflected in these financial statements.

Transport Canada has leased all of these airports under long-term operating agreements with Canadian Airport Authorities and a municipal government. These agreements are in accordance with the federal National Airports Policy, the Public Accountability Principles for Canadian Airport Authorities and the Fundamental Principles for the Creation and Operations of Canadian Airport Authorities, which, in part, entail the transfer of the management, operations and maintenance of certain airports in Canada to Canadian Airport Authorities.

Transport Canada has the right to terminate the operating agreements and assume the responsibility for the management, operation and maintenance of the airport if the leased airports are not operated in accordance with the terms of the respective operating agreements and the Policies and Principles referred to above.

Values recorded for the National Airport System assets for 23 National Airports are:

St. Lawrence Seaway assets

Land, buildings, works and infrastructure, and machinery and equipment owned by Transport Canada related to the St. Lawrence Seaway (Seaway) are included in the table above. Ownership of these assets was transferred to Transport Canada effective October 1, 1998, when the St. Lawrence Seaway Management Corporation (SLSMC) was established. The original 20-year agreement with the federal government that was expected to end on March 31, 2018 was extended in 2017 for a period of five years and will therefore be in force until March 31, 2023. The SLSMC is responsible for managing and operating the Seaway, as well as the maintenance, repairs, acquisition and replacement of government-owned Navigation Seaway Assets. Transport Canada is responsible for funding any SLSMC financial requirements net of revenues. In 2017-2018, $54,157 thousand of the annual funding provided was utilized to acquire tangible capital assets ($90,113 thousand in 2016-2017). Other amounts to fund minor maintenance and repairs are recorded as an operating expense in the statement of operations.

Values recorded for the Seaway assets are:

13. Departmental net financial position

A portion of Transport Canada's net financial position is restricted for specific purposes. Related revenues and expenses are included in the Statement of Operations and Departmental Net Financial Position. Transport Canada has three accounts which fall under this category:

  1. Ship-source Oil Pollution Fund (SOPF)

    The Ship-source Oil Pollution Fund (Fund) was established pursuant to subsection 2001, c.6 of the Marine Liability Act (previously the Canada Shipping Act), to record levy tonnage payments for oil carried by ships in Canadian waters. Maritime pollution claims, the fee of the fund administrator, and related oil pollution control expenses, are financed out of the Fund. Additional information regarding the Ship-source Oil Pollution Fund can be found on the Fund's website.

  2. Fines for Transport of Dangerous Goods

    The Fines for Transport of Dangerous Goods account was established pursuant to the Transportation of Dangerous Goods Act 1992 and related regulations to record fines levied by courts under the Act. The balance of the account is used for program funding.

  3. Fund for Railway Accidents Involving Designated Goods (FRAIDG)

    The Fund for Railway Accidents Involving Designated Goods was established pursuant to the Safe and Accountable Rail Act to establish a compensation fund to cover the losses, damages, costs and expenses resulting from a railway accident involving crude oil or other designated goods that exceed the minimum liability insurance coverage. This account is financed by a levy on shipments of crude oil by rail.

Activities incurred during the year in the accounts are as follows:

 

2018

2017

 

(in thousands of dollars)

Ship-source Oil Pollution Fund

Balance – Beginning of year

409,455

411,288

Revenues

6,438

3,317

Expenses

(3,689)

(5,150)

Balance – End of year

412,204

409,455

Fines for Transport of Dangerous Goods

Balance – Beginning of year

514

514

Revenues

3,600

-

Expenses

-

-

Balance – End of year

4,114

514

Fund for Railway Accidents Involving Designated Goods

Balance – Beginning of year

4,913

-

Revenues

13,294

4,985

Expenses

(373)

(72)

Balance – End of year

17,834

4,913

Total balance – End of year

434,152

414,882

Unrestricted

1,593,128

1,515,714

Departmental net financial position – End of year

2,027,280

1,930,596

14. Contractual obligations and contractual rights
  1. Contractual obligations

    The nature of Transport Canada's activities may result in some large multi-year contracts and obligations whereby Transport Canada will be obligated to make future payments in order to carry out its transfer payment programs or when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:

     

    2019

    2020

    2021

    2022

    2023 and
    thereafter

    Total

     

    (in thousands of dollars)

    Transfer payments

    135,260

    104,111

    38,901

    31,827

    89,458

    399,557

    Other goods and services

    67,947

    44,912

    28,553

    27,354

    26,856

    195,622

    Tangible capital assets

    50,355

    53,082

    63,000

    59,427

    53,136

    279,000

    Total

    253,562

    202,105

    130,454

    118,608

    169,450

    874,179

  2. Contractual rights

    The activities of Transport Canada sometimes involve the negotiation of contracts or agreements with outside parties that result in Transport Canada having rights to both assets and revenues in the future. They principally involve leases of property such as airports and hopper cars. Major contractual rights that will generate revenues in future years and that can be reasonably estimated are summarized as follows:

     

    Leases of property

     

    (in thousands of dollars)

    2019

    377,933

    2020

    388,591

    2021

    401,209

    2022

    417,183

    2023

    425,290

    2024 and subsequent

    -

    Total

    2,010,206

15. Contingent liabilities and contingent assets
  1. Contingent liabilities

    Contingent liabilities arise in the normal course of operations and their ultimate disposition is unknown.

    Claims and litigation
    Claims have been made against Transport Canada in the normal course of operations. These claims include items with pleading amounts and others for which no amount is specified. While the total amount claimed in these actions is significant, their outcomes are not determinable. Transport Canada has recorded an allowance for claims and litigations in the amount of $9,750 thousand ($54,750 thousand in 2016-2017) where it is likely that there will be a future payment and a reasonable estimate of the loss can be made. Claims and litigations for which the outcome is not determinable and a reasonable estimate can be made by management amount to approximately $6,747 thousand ($9,611 thousand in 2016-2017) at March 31,2018. Transport Canada has no claims and litigation with related parties at March 31, 2018.

  2. Contingent assets
    Transport Canada has determined that there are no contingent assets which require disclosure in these financial statements.

  3. Environmental liabilities
    Transport Canada has disclosed a contingent liability in the amount of $2,371 thousand for 3 sites ($6,532 thousand in 2016-2017 for 3 sites) where Transport Canada has determined that it is not directly responsible, nor does it accept responsibility; however, there is uncertainty as to whether Transport Canada may be held legally or morally responsible.

16. Related party transactions

Transport Canada is related as a result of common ownership to all government departments, agencies, and Crown corporations. Related parties also include individuals who are members of key management personnel or close family members of those individuals, and entities controlled by, or under shared control of, a member of key management personnel or a close family member of that individual.

Transport Canada enters into transactions with these entities in the normal course of business and on normal trade terms.

All material transactions with related parties were transacted at values consistent with an arm's-length transaction.

  1. Common services provided without charge by other government departments

    During the year, Transport Canada received services without charge from certain common service organizations related to accommodation, legal services, the employer's contribution to the health and dental insurance plans and workers' compensation coverage. These services provided without charge have been recorded at their carrying value in Transport Canada's Statement of Operations and Departmental Net Financial Position as follows:

     

    2018

    2017

     

    (in thousands of dollars)

    Employer's contribution to health and dental insurance plans

    45,718

    38,940

    Office accommodation

    44,062

    43,598

    Legal services

    4,176

    5,031

    Workers' compensation

    2,659

    2,852

     

    96,615

    90,421

    The Government has centralized some of its administrative activities for efficiency and cost-effectiveness purposes of programs to the public. As a result, the Government uses central agencies and common service organizations so that one department performs services for all other departments and agencies without charge. The costs of these services, such as the payroll and cheque issuance services provided by Public Services and Procurement Canada, and audit services provided by the Office of the Auditor General are not included in Transport Canada's Statement of Operations and Departmental Net Financial Position.

  2. Administration of programs on behalf of other government departments:

    1. Canada Strategic Infrastructure Fund (CSIF) and Border Infrastructure Fund (BIF)

      Under a memorandum of understanding signed with Infrastructure Canada on January 31, 2003, Transport Canada administers the CSIF and the BIF. During the year, Transport Canada incurred expenses of $35,908 thousand ($39,350 thousand in 2016-2017) related to the CSIF, and $68 thousand (NIL in 2016-2017) related to the BIF, on behalf of Infrastructure Canada. These expenses are reflected in the financial statements of Infrastructure Canada and are not recorded in these financial statements.

    2. Building Canada Fund (BCF)

      Under a memorandum of understanding signed with Infrastructure Canada on April 25, 2008, Transport Canada administers the BCF. During the year, Transport Canada incurred expenses of $184,451 thousand ($425,938 thousand in 2016-2017) on behalf of Infrastructure Canada. These expenses are reflected in the financial statements of Infrastructure Canada and are not recorded in these financial statements.

  3. Other transactions with other government departments and agencies:

     

    2018

    2017

     

    (in thousands of dollars)

    ExpensesFootnote 1

    104,248

    84,280

    RevenuesFootnote 2

    36,960

    31,872

Expenses and revenues disclosed in (c) exclude common services provided without charge, which are already disclosed in (a).

17. Transfers from/to other government departments

During the year, tangible capital assets were transferred to other government departments. The transfers were recorded at their net book value.

Assets:

(in thousands of dollars)

Tangible capital assets transferred to Parks CanadaFootnote 1 (note 12)

(5,690)

Tangible capital asset transferred from other government departments (note 12)

5

Impact on tangible capital assets and net financial position

(5,685)

18. Segmented information

Presentation by segment is based on Transport Canada's program alignment architecture. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in note 2. The following table presents the expenses incurred and revenues generated for the main programs, by major object of expense and by major type of revenue. The segment results for the period are as follows:

 

An Efficient
Transportation
System

A Safe and
Secure
Transportation
System

Internal
Services

A Clean
Transportation
System

Specified
Purpose
Accounts
(note 13)

2018
Total

2017
Total

 

(in thousands of dollars)

Operating expenses

Salaries and employee benefits

48,283

393,149

139,970

39,632

-

621,034

522,752

Amortization of tangible capital assets (note 12)

108,302

16,418

11,515

1,156

-

137,391

145,439

Professional and special services

29,502

33,412

33,157

26,470

-

122,541

124,110

Accommodation (note 16)

3,598

27,397

10,322

2,745

-

44,062

43,598

Interest and inflation adjustment on capital lease payments (note 7)

41,998

-

-

-

-

41,998

41,942

Equipment repair and maintenance

6,260

18,562

7,553

5,710

-

38,085

25,506

Travel and relocation

1,883

21,288

1,329

2,317

-

26,817

16,817

Utilities, materials and supplies

3,255

10,681

1,133

793

-

15,862

13,677

Operating costs in respect of St. Lawrence Seaway

14,984

-

-

-

-

14,984

25,283

Rentals

351

4,498

2,900

345

-

8,094

6,828

Payments in lieu of property taxes

4,812

1,259

705

-

-

6,776

7,114

Damage and other claims against the Crown

4,400

1,561

467

-

-

6,428

1,721

Information services – communications

2,538

1,569

323

589

-

5,019

3,684

Specified purpose accounts (note 13)

-

-

-

-

4,062

4,062

5,222

Other

275

504

3,232

(54)

-

3,957

2,141

Postage

484

1,286

236

121

-

2,127

1,675

Telecommunications

105

814

785

59

-

1,763

1,492

Expenses incurred on behalf of Government

-

-

-

-

(4,062)

(4,062)

(5,222)

Reclassification of Work in Progress

(16,194)

-

9,437

-

-

(6,757)

287

Gain on disposal of tangible capital assets

(17,262)

(417)

(3,561)

-

-

(21,240)

(4,831)

Decrease in contingent liabilities (note 15)

-

-

(45,000)

-

-

(45,000)

(2,000)

Total operating expenses

237,574

531,981

174,503

79,883

-

1,023,941

977,235

Transfer payments

Other levels of government within Canada

93,025

8,866

-

842

-

102,733

197,528

Industry

81,058

9,520

-

5,295

-

95,873

90,700

Non-profit organizations

7,323

4,373

-

2,397

-

14,093

22,509

Individuals

221

6

-

-

-

227

255

Other countries and international organizations

-

186

-

5

-

191

480

Total transfer payments

181,627

22,951

-

8,539

-

213,117

311,472

Total expenses

419,201

554,932

174,503

88,422

-

1,237,058

1,288,707

Revenues

Leases of property

374,808

-

-

-

-

374,808

348,892

Monitoring and enforcement revenues

24,214

22,526

998

-

-

47,738

48,873

Aircraft maintenance and flying services

-

27,581

-

-

-

27,581

25,442

Rentals and concessions

10,632

961

12,462

-

-

24,055

26,008

Specified purpose accounts (note 13)

-

-

-

-

23,332

23,332

8,302

Transport facilities user fees

13,873

858

-

-

-

14,731

12,309

Other

1,600

1,619

151

-

-

3,370

3,022

Revenues earned on behalf of Government

(405,548)

(574)

(12,992)

-

(23,332)

(442,446)

(399,584)

Total revenues

19,579

52,971

619

-

-

73,169

73,264

Net cost from continuing operations

399,622

501,961

173,884

88,422

-

1,163,889

1,215,443

19. Subsequent Events

On August 8, 2018, the federal government announced its decision to transfer the ports of Matane, Gaspé, Rimouski and Gros-Cacouna to the Province of Quebec, effective March 31, 2020. As part of the agreement, the federal government will provide $163,000 thousands to the Province of Quebec, including a grant in the amount of $148,800 thousands to sustain the future operating costs and maintenance for the 4 ports. The impact of the transfer, once finalized, will be reflected in the 2019-2020 financial statements.

20. Comparative Information

Certain comparative figures have been reclassified to conform to the current year's presentation.