Table of contents

 

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, 2019, and all information contained in these financial statements rests with the management of the Parks Canada Agency. 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 the Agency's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada, and included in the Agency'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 the Agency; 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, 2019 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 the Agency's system of internal control is reviewed by the work of internal audit staff, who conduct periodic audits of different areas of the Agency's operations, and by the Audit Committee, which oversees management's responsibilities for maintaining adequate control systems and the quality of financial reporting.

The financial statements of the Agency have not been audited.

Ron Hallman

Chief Executive Officer, Parks Canada
Gatineau, Canada
Date: August 30, 2019

Ghislaine Lalonde

A/Chief Financial Officer, Parks Canada
Gatineau, Canada
Date: August 30, 2019

Statement of financial position (unaudited)

Table 1 as at March 31 (in thousands of dollars)
Liabilities 2019 2018
Restated (note 18)
Accounts payable and accrued liabilities (Note 4) 187,770 174,676
Environmental liabilities (Note 5) 76,893 58,051
Deferred revenue (Note 6) 38,713 37,843
Lease obligations for tangible capital assets (Note 7) 2,036 2,453
Employee future benefits (Note 8) 10,364 10,251
Total liabilities 315,776 283,274
Financial assets
Due from the Consolidated Revenue Fund 197,721 181,482
Accounts receivable and advances (Note 9) 26,810 28,571
Total financial assets 224,531 210,053
Net debt 91,245 73,221
Non-financial assets
Prepaid expenses 3,424 2,440
Inventory (Note 10) 12,191 9,828
Tangible capital assets (Note 11) 3,807,040 3,275,746
Total non-financial assets 3,822,655 3,288,014
Net financial position (Note 12) 3,731,410 3,214,793

Contractual obligations and contractual rights (Note 13)

Contingent liabilities (Note 14)

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

Ron Hallman

Chief Executive Officer, Parks Canada
Gatineau, Canada
Date: August 30, 2019

Ghislaine Lalonde

A/Chief Financial Officer, Parks Canada
Gatineau, Canada
Date: August 30, 2019

Statement of operations and net financial position (unaudited)

Table 2 for the year ended March 31 (in thousands of dollars)
Expenses 2019 Planned Results 2019 2018
Restated (note 18)
Parks Canada programs
Heritage places establishment 26,863 13,082 9,815
Heritage resources conservation 139,963 228,925 197,307
Heritage places promotion and public support 51,794 67,395 50,933
Visitor experience 298,132 413,656 333,959
Heritage canals, highways and townsite management 96,421 134,776 108,145
Internal services 172,267 136,680 178,254
Total expenses 785,440 994,514 878,413
Revenues
Entrance fees 66,785 81,350 15,465
Recreational fees 32,625 41,761 36,881
Rentals and concessions 27,120 31,933 33,806
Other operating revenues 7,270 9,964 8,064
Townsites revenues 3,150 2,963 3,126
Staff housing 3,131 3,586 3,544
Revenues from donated properties - 16,738 41,357
Revenues earned on behalf of Government (81) (154) (99)
Total revenues 140,000 188,141 142,144
Net cost of operations before government funding and transfers 645,440 806,373 736,269
Government funding and transfers
Net cash provided by Government of Canada   1,251,504 1,181,190
Change in due from Consolidated Revenue Fund   16,239 9,217
Services provided without charge by other government departments (Note 15a)   55,195 50,953
Transfer of the transition payments for implementing salary payments in arrears   - -
Transfer of assets from other government departments   52 6,001
Total government funding and transfers   1,322,990 1,247,361
Net cost of operations after government funding and transfers   (516,617) (511,092)
Net financial position - Beginning of year   3,214,793 2,703,701
Net financial position - End of year   3,731,410 3,214,793

Segmented information (Note 16)

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

Statement of change in net debt (unaudited)

Table 3 for the year ended March 31 (in thousands of dollars)
(in thousands of dollars) 2019 2018
Restated (note 18)
Net cost of operations after government funding and transfers (516,617) (511,092)
Change due to tangible capital assets
Acquisitions and improvements to tangible capital assets 692,696 654,541
Amortization of tangible capital assets (145,419) (122,512)
Proceeds from disposal of tangible capital assets (1,300) (648)
Net loss on disposal of tangible capital assets including adjustments (14,745) (22,594)
Transfer from other government departments 62 6,001
Total change due to tangible capital assets 531,294 514,788
Change due to inventory 2,363 1,233
Change due to prepaid expenses 984 (118)
Net increase in net debt 18,024 4,811
Net debt - Beginning of year 73,221 68,410
Net debt - End of year 91,245 73,221

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

Statement of cash flows (unaudited)

Table 4 for the year ended March 31
(in thousands of dollars) 2019 2018
Restated (note 18)
Operating activities
Net cost of operations before government funding and transfers 806,373 736,269
Non-cash items:
Amortization of tangible capital assets (145,419) (122,512)
Net loss on disposal of tangible capital assets including adjustments (14,745) (22,594)
Services provided without charge by other government departments (Note 15a) (55,195) (50,953)
Variations in statement of financial position:
(Decrease) increase in accounts receivable and advances (1,761) 6,361
Increase (decrease) in prepaid expenses 984 (118)
Increase in inventory 2,363 1,233
Increase in accounts payable and accrued liabilities (13,094) (10,498)
Increase in deferred revenue (870) (2,911)
Decrease (increase) in employee future benefits (113) 55
Increase in environmental liabilities (18,842) (7,413)
Transfer of other assets 10 -
Cash used in operating activities 559,691 526,919
Capital investing activities
Acquisitions and improvements to tangible capital assets 692,696 654,541
Proceeds from disposal of tangible capital assets (1,300) (648)
Cash used in capital investing activities 691,396 653,893
Financing activities
Payments on lease obligations for tangible capital assets 417 378
Cash used in financing activities 417 378
Net cash provided by Government of Canada 1,251,504 1,181,190

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

Notes to the financial statements (unaudited) for the year ended March 31

1. Authority and objectives

In December 1998, Parks Canada Agency (the Agency) was established under the Parks Canada Agency Act as a departmental corporation and acts as an agent of Her Majesty in Right of Canada. The Parks Canada Agency is a separate entity listed under Schedule II of the Financial Administration Act and reports to the Minister of Environment and Climate Change.

The Agency's mandate is to protect and present nationally significant examples of Canada's natural and cultural heritage, and foster public understanding, appreciation and enjoyment in ways that ensure the ecological and commemorative integrity of these places for present and future generations. In carrying out its mandate, the Agency delivers the programs set out in the Agency's legislation and authorities.

The authorities for the programs for which Parks Canada is responsible are mainly derived from the Parks Canada Agency Act, the Canada National Parks Act, the Rouge National Urban Park Act, the Historic Sites and Monuments Act, the Canada National Marine Conservation Areas Act, the Saguenay-St. Lawrence Marine Park Act, the Historic Canal Regulations pursuant to the Department of Transport Act, the Heritage Railway Stations Protection Act, the Heritage Lighthouse Protection Act, and the Species at Risk Act.

The programs include:

Heritage Places Establishment:
This program aims to establish heritage places in order to conserve Canada’s natural and cultural heritage for the benefit and enjoyment of present and future generations. This process results in national parks, national marine conservation areas, national historic sites, persons and events, and other designated heritage places, including world heritage sites. Establishment or designation is achieved through feasibility assessments, public nominations, research, consultation and engagement with Indigenous Peoples, stakeholders and the general public, negotiations with other governments and Indigenous organizations, and recommendations from advisory bodies, where required. The Program also supports the Government of Canada’s outcome of “A vibrant Canadian culture and heritage” and Canada’s international biodiversity goals (Canada Target 1).
Heritage Places Conservation:
This program aims to protect and conserve the natural and cultural resources of heritage places managed by Parks Canada, including some World Heritage Sites in Canada, for the benefit and enjoyment of present and future generations. This program also provides financial and professional support and advice to heritage places not administered by Parks Canada, and supports Canada’s international conservation obligations. Conservation of natural and cultural resources includes various knowledge-based approaches, applied science, monitoring and reporting, active management, ecological restoration, species recovery, environmental assessment, fire management, commemorative integrity assessments and statements for national historic sites and compliance activities. The Program supports the Government of Canada’s outcome of “A clean and healthy environment.”
Heritage Places Promotion and Public Support:
This program aims to strengthen awareness and appreciation of Canada's national parks, national historic sites, and national marine conservation areas, and to introduce key audiences, such as youth, new Canadians, low- and middle-income Canadians, and urban Canadians to these places. Promotional activities strengthen awareness of heritage places managed by Parks Canada as well as key visitor experience offers and programs. Promotional activities include advertising, social media promotion, marketing, proactive media, and collaborative efforts with national, regional, and local partners and the tourism trade. Outreach activities introduce Canadians to these places through direct connections, interactive experiences, and learning. Outreach activities include digital products such as online video, television, websites, and social media and also include interactive activities such as activation events and participation in learning and tourism events, community gatherings, festivals, and presence at institutions such as museums and aquariums. Collaborative arrangements and partnerships play an important role in promotions and outreach. This program supports the Government of Canada's outcome of "A vibrant Canadian culture and heritage".
Visitor Experience:
This program provides visitors to national parks, national historic sites, and national marine conservation areas with opportunities to enjoy and appreciate these places in safe and meaningful ways. The program includes a range of activities, such as trip planning, reception, camping, accommodations, visitor safety, visitor services, interpretive activities, merchandise, compliance, and support for visitor facilities. This program supports the Government of Canada's outcome of "A vibrant Canadian culture and heritage".
Heritage Canals, Highways and Townsites Management:
This program involves the management of infrastructure for Canadians and provides opportunities for socio-economic benefits to adjacent communities. This program includes: the operation, maintenance and improvement of the Trans-Canada and provincially numbered highways within national parks and a national historic site; water management activities and the management of bridge and dam infrastructure at heritage canals; and the provision of municipal services to certain national park townsites, and the management of related infrastructure. This program supports the Government of Canada’s outcome of “A safe and secure Canada.”
Internal Services:
Internal Services are those 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 Internal Services delivery model in a department. 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.

2. Summary of significant accounting policies

These financial statements are prepared using the Government of 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:

(a) Parliamentary authorities

The Agency is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to the Agency 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 Net Financial Position and in the Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament. Note 3 provides a reconciliation between the bases of reporting. The planned results amounts in the “Expenses” and “Revenues” sections of the Statement of Operations and Net Financial Position are the amounts reported in the Future-oriented Statement of Operations included in the 2018-2019 Departmental Plan. Planned results are not presented in the “Government funding and transfers” section of the Statement of Operations and Net Financial Position and in the Statement of Change in Net Debt because these amounts were not included in the 2018-2019 Departmental Plan.

(b) Net cash provided by Government

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

(c) 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 the Agency is entitled to draw from the CRF without further authorities to discharge its liabilities.

(d) Revenues

Entrance fees, recreational fees, rental and concessions, townsites, staff housing and other operating revenues are recognized based on the goods or services provided in the year by the Agency.

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 the Agency's liabilities. While the CEO is expected to maintain accounting control, he 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 Agency's gross revenues.

(e) 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.

(f) Employee future benefits

  • Pension benefits:
Eligible employees participate in the Public Service Pension Plan, a multiemployer pension plan administered by the Government. The Agency's contributions to the Plan are charged to expenses in the year incurred and represent the total obligation to the Plan. The Agency’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.
  • 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.

(g) Accounts receivable

Accounts receivable are initially recorded at cost. When necessary, an allowance for valuation is recorded to reduce the carrying value of accounts receivable to amounts that approximate their net recoverable value.

(h) 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 11. 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 and museum collection to which no acquisition cost is attributable; and intangible assets. Acquired lands are recorded at historical cost. Crown lands acquired as a result of Confederation or the subsequent joining of a province or territory are recorded at a nominal value. Donated lands are recorded at their estimated market value at time of acquisition.

Inventories are valued at cost and are comprised of consumable 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.

(i) 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.

(j) 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 its 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.

(k) Transactions involving foreign currencies

Transactions involving foreign currencies are translated in Canadian dollar equivalents using rates of exchange in effect at the time of those transactions.

(l) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported and disclosed amounts of assets, liabilities, revenues and expenses reported in the financial statements and accompanying notes at March 31. 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 tangible 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.

(m) 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 agency financial statement purposes at the carrying amount.

3. Parliamentary authorities

The Agency receives most of its funding through annual parliamentary authorities. Items recognized in the Statement of Operations and 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, the Agency 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

Table 5 for the year ended March 31
(in thousands of dollars) 2019 2018
Restated (note 18)
Net cost of operations before government funding and transfers 806,373 736,269
Total revenues as per Statement of Operations 188,141 142,144
less: Revenues from donated properties (16,738) (41,357)
Revenues received pursuant to section 20 of the Parks Canada Agency Act 171,403 100,787
Adjustments for items affecting net cost of operations but not affecting authorities:
Amortization of tangible capital assets (145,419) (122,512)
Services provided without charge by other government departments (55,195) (50,953)
Net loss on disposal of tangible capital assets including adjustments (14,745) (22,594)
Increase in vacation pay and compensatory leave (2,170) (2,843)
Decrease (increase) in employee future benefits (113) 55
Increase in environmental liability (18,842) (7,413)
Refund of prior years' expenditures 3,362 2,024
Increase in New Parks and Historic Sites Account 17,762 25,082
Other (1,497) (2,271)
Total items affecting net cost of operations but not affecting authorities (216,857) (181,425)
Adjustments for items not affecting net cost of operations but affecting authorities:
Acquisitions and improvements to tangible capital assets 692,696 654,541
Salary overpayments 3,864 5,031
Proceeds from disposal of tangible capital assets (1,300) (648)
Decrease in lease obligation for tangible capital assets 417 378
Increase in inventory 2,363 1,233
Increase (decrease) in prepaid expenses 984 (118)
Transition payments for implementing salary payments in arrears - -
Other 382 985
Total items not affecting net cost of operations but affecting authorities 699,406 661,402
Current year authorities used 1,460,325 1,317,033

(b) Authorities provided and used

Table 6 for the year ended March 31
(in thousands of dollars) 2019 2018 Restated (note 18)
Authorities provided:
Vote 1 - Program expenditures 1,678,280 1,570,654
Vote 5 - New Parks and Historic Sites Account 44,007 25,546
Statutory amounts:
Expenditures equivalent to revenue received pursuant to section 20 of the Parks Canada Agency Act 196,038 121,405
Contributions to employee benefit plans 63,338 51,596
Total authorities 1,981,663 1,769,201
Less:
Authorities available for future years 500,281 365,264
Lapsed authorities 21,057 86,904
Current year authorities used 1,460,325 1,317,033

4. Accounts payable and accrued liabilities

Table 7 for the year ended March 31
The following table presents details of the Agency’s accounts payable and accrued liabilities:
(in thousands of dollars) 2019 2018
Accounts payable - Other government departments and agencies 39,480 31,756
Accounts payable - External parties 109,904 107,654
Total accounts payable 149,384 139,410
Accrued liabilities 38,386 35,266
Total accounts payable and accrued liabilities 187,770 174,676

5. Environmental liabilities

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.

The Agency has identified 234 sites (235 sites in 2018) where contamination may exist and assessment, remediation and monitoring may be required. Of these, the Agency has identified 88 sites (90 sites in 2018) where action is required and for which a gross liability of $58,610,506 ($39,644,198 in 2018) has been recorded. This liability estimate has been determined based on site assessments performed by environmental experts.

In addition, a statistical model based upon a projection of the number of sites that will proceed to remediation and upon which current and historical costs are applied is used to estimate the liability for a group of unassessed sites. As a result, there are 67 unassessed sites (96 sites in 2018) where a liability estimate of $18,282,159 ($18,406,472 in 2018) has been recorded using this model.

These two estimates combined, totaling $76,892,665 ($58,050,670 in 2018) represents management’s best estimate of the costs required to remediate sites to the current minimum standard for its use prior to contamination, based on information available at the financial statement date.

For the remaining 79 sites (49 sites in 2018), 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, the Agency 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, 2019, and March 31, 2018. When the liability estimate is based on a future cash requirement, the amount is adjusted for inflation using a forecast CPI rate of 2.2% (1.9% in 2018). 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 2019 rates range from 1.55% (1.79% in 2018) for 2 year term to 1.92% (2.24% in 2018) for a 30 or greater year term.

Table 8 for the year ended March 31 (in thousands of dollars)
Nature and Source Number of Sites 2019 Estimated Liability 2019 Estimated Total Undiscounted Expenditures 2019 Number of Sites 2018 Estimated Liability 2018 Estimated Total Undiscounted Expenditures 2018
Former Mineral Exploration Sites 1 4 3,829 4,007 4 3,708 3,921
Military & Former Military Sites 2 1 152 159 1 147 156
Fuel Related Practices 3 21 5,254 5,498 24 7,625 8,063
Landfill/Waste Sites 4 72 23,432 24,522 97 24,058 25,440
Engineered Asset/Air & Land Transportation 5 2 349 365 2 344 364
Marine Facilities/Aquatic Sites 6 5 24,816 25,970 6 1,831 1,936
Office/Commercial/Industrial Operations 7 34 14,985 15,682 36 16,463 17,409
Other 8 16 4,075 4,265 16 3,875 4,098
Totals 155 76,892 80,468 186 58,051 61,387

Also during the year 3 sites (8 in 2018) were closed 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.

Table 8 note 1

Contamination associated with former mine activities, e.g. heavy metals, petroleum hydrocarbons, etc. Sites often have multiple sources of contamination.

1

Table 8 note 2

Contamination associated with the operations of military and former military sites where activities such as fuel handling and storage activities, waste sites, metals/PCB-based paint used on buildings resulted in former or accidental contamination, e.g. petroleum hydrocarbons, polychlorinated biphenyls (PCBs), heavy metals. Sites often have multiple sources of contamination.

2

Table 8 note 3

Contamination primarily associated with fuel storage and handling, e.g. accidental spills related to fuel storage tanks or former fuel handling practices, e.g. petroleum hydrocarbons, polyaromatic hydrocarbons and BTEX (benzene, toluene, ethylbenzene and xylenes).

3

Table 8 note 4

Contamination associated with former landfill/waste site or leaching from materials deposited in the landfill/waste site, e.g. metals, petroleum hydrocarbons, BTEX, other organic contaminants, etc.

4

Table 8 note 5

Contamination associated with the operations of engineered assets such as airports, railways and roads where activities such as, fuel storage/handling, waste sites, firefighting training facilities and chemical storage areas resulted in former or accidental contamination, e.g. metals, petroleum hydrocarbons, polyaromatic hydrocarbons, BTEX and other organic contaminants. Sites often have multiple sources of contamination.

5

Table 8 note 6

Contamination associated with the operations of marine assets, e.g. port facilities, harbours, navigation systems, light stations, hydrometric stations, where activities such as fuel storage/handling, use of metal based paint (e.g. on light stations) resulted in former or accidental contamination, e.g. metals, petroleum hydrocarbons, polyaromatic hydrocarbons and other organic contaminants. Sites often have multiple sources of contamination.

6

Table 8 note 7

Contamination associated with the operations of the office/commercial/industrial facilities where activities such as fuel storage/handling waste sites and use of metal-based paint resulted in former or accidental contamination, e.g. metals, petroleum hydrocarbons, polyaromatic hydrocarbons, BTEX, etc. Sites often have multiple sources of contamination.

7

Table 8 note 8

Contamination from other sources, e.g. use of pesticides, herbicides, fertilizers at agricultural sites, use of PCBs, firefighting training areas, firing ranges and training facilities, etc.

8

6. Deferred revenue

Deferred revenue represents the balance at year-end of unearned revenues stemming from amounts received from external parties for fees prior to services being performed. Revenue is recognized in the period in which the service is performed. Details of the transactions related to this account are as follows:

Table 9 for the year ended March 31
(in thousands of dollars) 2019 2018
Deferred revenue - Beginning of year 37,843 34,932
Amounts received 37,561 35,235
Revenue recognized (36,691) (32,324)
Deferred revenue - End of year 38,713 37,843

7. Lease obligations for tangible capital assets

The Agency has entered into agreements to lease commercial and office space under capital leases with a cost of $19,205,164 and accumulated amortization of $8,269,377 as at March 31, 2019 ($20,967,931 and $8,216,548 respectively as at March 31, 2018). The obligations related to the upcoming years include the following:

Table 10 for the year ended March 31
(in thousands of dollars) 2019 2018
2019 - 544
2020 509 509
2021 403 403
2022 403 403
2023 403 403
2024 and subsequent 788 797
Total future minimum lease payment 2,506 3,059
Less: imputed interest (6.3%) 470 606
Balance of obligations under leased tangible capital assets 2,036 2,453

8. Employee future benefits

(a) Pension benefits

The Agency'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 the Agency 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 related 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 2019 expense amounts to $44,171,750 ($35,136,745 in 2018). For Group 1 members, the expense represents approximately 1.01 times (1.01 times in 2018) the employee contributions and, for Group 2 members, approximately 1.00 times (1.00 times in 2018) the employee contributions.

The Agency'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.

(b) Severance benefits

Severance benefits provided to the Agency’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:

Table 11 for the year ended March 31
(in thousands of dollars) 2019 2018
Accrued benefit obligation - Beginning of year 10,251 10,306
Expense for the year 1,670 926
Benefits paid during the year (1,557) (981)
Accrued benefit obligation - End of year 10,364 10,251

9. Accounts receivable and advances

Table 12 for the year ended March 31
The following table presents details of the Agency's accounts receivable and advances balances:
(in thousands of dollars) 2019 2018
Receivables - Other government departments and agencies 5,584 6,531
Receivables - External parties 18,399 19,919
Employee advances 3,562 3,194
Subtotal 27,545 29,644
Allowance for doubtful accounts on receivables from external parties (735) (1,073)
Total accounts receivable and advances 26,810 28,571

10. Inventory

Table 13 for the year ended March 31
(in thousands of dollars) 2019 2018
Stationery, office and miscellaneous supplies 3,874 3,256
Equipment, materials and supplies 1,797 1,620
Safety equipment 1,275 1,122
Fabricated wood and metal products 1,172 866
Fuel and other petroleum products 926 833
Top soil, sand, gravel and other crude material 1,481 641
Construction material and supplies 669 576
Printed books, publications and maps 544 543
Uniforms and protective clothing 453 371
Total inventory 12,191 9,828
The cost of consumed inventory recognized as an expense in the Statement of Operations and Net Financial Position is $69,840,693 in 2019 ($71,953,938 in 2018).

11. Tangible capital assets

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

Asset Class
Amortization Period

Buildings

25-50 years

Fortifications

50-100 years

Leasehold improvements

Lesser of the remaining term of the lease or useful life of the improvement

Leased tangible capital assets

Term of lease or economic life of the property if the lease contains a bargain purchase option

Landscaping and improvement

10-40 years

Roads

40 years

Bridges

25-50 years

Canals and marine facilities

25-80 years

Utilities

20-40 years

Vehicles and equipment

3-15 years

Exhibits

5-10 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.

Collections and archaeological sites

Core to the Agency's mandate to protect and present nationally significant examples of our cultural heritage is the management of collections and archaeological sites. Although not capitalized like other cultural assets such as buildings or fortifications, these treasures have inestimable cultural value.

(a) Collections

The Agency manages collections that are made up of archaeological and historical objects.

The collection of archaeological objects includes specimens and records that represent a cross-section of human habitation and activities. These holdings consist of a range of functional groups of artifacts that represent domestic activities to industrial processes and includes tools, ships' fittings, as well as soil and botanical samples.

The collection of historic objects dates from the 10th century to the present day. They encompass ethnographic material, civilian, military and fur trade items, furniture and furnishings, tools and documents.

In addition, the Agency manages a collection of reproductions including period costumes, tools and furniture that have been copied from original objects or made based on historical data.

(b) Archaeological sites

An archaeological site encompasses surface, subsurface, or submerged remains of human activity. Archaeologists define a site by identifying the different activities that were conducted within an area. There are many archaeological sites identified within Parks Canada's national historic sites, national parks and marine conservation areas. The types of sites vary greatly, from Indigenous villages, hunting camps, observation areas, and animal processing areas, to European fur trade and military posts, battlefields, shipwrecks, homesteads, and transportation and industrial sites.

Table 14 for the year ended March 31 (in thousands of dollars)
Cost Opening Balance
Restated (note 18)
Acquisitions Adjustments Footnote 1 Disposals and Write-offs Closing Balance
Tangible capital assets
Land 233,460 36,263 (1,944) 363 267,416
Buildings, fortifications and leasehold improvements 1,022,821 24,187 49,781 3,350 1,093,439
Landscaping and improvement 693,274 4,866 14,740 7,856 705,024
Roads 1,681,583 112,585 63,896 27,778 1,830,286
Bridges 565,140 52,221 76,466 8,511 685,316
Canal and marine facilities 693,587 7,227 26,687 1,317 726,184
Utilities 300,523 3,347 12,005 979 314,896
Vehicles and equipment 190,833 7,991 9,137 4,706 203,255
Exhibits 107,245 106 520 1,849 106,022
- 5,488,466 248,793 251,288 56,709 5,931,838
Assets under construction
Buildings, fortifications and leasehold improvements 157,631 108,060 (37,444) 294 227,953
Landscaping and improvement 80,957 53,046 (11,745) 5,427 116,831
Roads 161,240 52,218 (107,483) 873 105,102
Bridges 60,974 36,622 (38,039) 20 59,537
Canal and marine facilities 162,194 163,480 (24,524) 413 300,737
Utilities 49,561 23,180 (11,138) 92 61,511
Vehicles and equipment 17,414 5,373 (7,677) 255 14,855
Exhibits 9,364 1,924 (384) 336 10,568
- 699,335 443,903 (238,434) 7,710 897,094
Leased tangible capital assets
Buildings, fortifications and leasehold improvements 20,968 - (1,763) - 19,205
Total 6,208,769 692,696 11,091 64,419 6,848,137
Footnote 1

Adjustments include assets under construction of $241,334,042 that were transferred to the other categories upon completion of the assets.

Return to footnote 1 referrer

 
Table 15 for the year ended March 31 (in thousands of dollars)
Accumulated Amortization Opening Balance Amortization AdjustmentsFootnote 1 Disposals and Write-offs Closing Balance Net Book Value
2019 2018
Restated (note 18)
Tangible capital assets
Land - - - - - 267,416 233,460
Buildings, fortifications and leasehold improvements 650,253 20,377 9,193 2,629 677,194 416,245 372,568
Landscaping and improvement 592,179 9,849 (526) 7,497 594,005 111,019 101,095
Roads 827,274 65,665 100 23,573 869,466 960,820 854,309
Bridges 144,606 14,728 - 4,543 154,791 530,525 420,534
Canal and marine facilities 353,335 9,565 234 940 362,194 363,990 340,252
Utilities 143,994 7,581 235 921 150,889 164,007 156,529
Vehicles and equipment 117,961 14,336 309 4,554 128,052 75,203 72,872
Exhibits 95,205 2,562 - 1,529 96,238 9,784 12,040
- 2,924,807 144,663 9,545 46,186 3,032,829 2,899,009 2,563,659
Assets under construction
Buildings, fortifications and leasehold improvements - - - - - 227,953 157,631
Landscaping and improvement - - - - - 116,831 80,957
Roads - - - - - 105,102 161,240
Bridges - - - - - 59,537 60,974
Canal and marine facilities - - - - - 300,737 162,194
Utilities - - - - - 61,511 49,561
Vehicles and equipment - - - - - 14,855 17,414
Exhibits - - - - - 10,568 9,364
  - - - - - 897,094 699,335
Leased tangible capital assets
Buildings, fortifications and leasehold improvements 8,216 756 (704) - 8,268 10,937 12,752
Total 2,933,023 145,419 8,841 46,186 3,041,097 3,807,040 3,275,746
Footnote 1

During 2018-19, the Agency transferred in equipment with a net book value of $74,129 from Environment and Climate Change Canada and transferred a vehicle with a net book value of $12,029 to Indian Affairs and Northern Development. These transfers are included in the adjustments column.

Return to footnote 1 referrer

12. Net financial position

A portion of the Agency's net financial position is used for a specific purpose. Related revenues and expenses are included in the Statement of Operations and Net Financial Position.

The New Parks and Historic Sites Account was established pursuant to the Parks Canada Agency Act. Funds are provided to the New Parks and Historic Sites Account by voted authorities, proceeds from the sale of lands and buildings that are surplus to operational requirements and all general donations. Furthermore, the Minister of Finance may, on the request of the Minister of the Environment, authorize the making of advances of up to $10 million to the New Parks and Historic Sites Account. All amounts received remain in this account until eligible capital expenditures are made for the purpose of establishing or developing new parks or historic sites and heritage areas, in compliance with the terms and conditions set out in the Parks Canada Agency Act and related Treasury Board directives. The balance of the account is to be used to acquire real property or immovables related to, or to develop or maintain any national park, national historic site, national marine conservation area or other protected heritage area that is being established, enlarged or designated.

The late The Right Hon W L Mackenzie King bequeathed Laurier House, Ottawa, and the sum of $225,000, to the Government of Canada. This amount was credited to the account and earns interest, in accordance with the terms of section 3 of the Laurier House Act. The interest is to be used to assist in the maintenance of the Laurier House, which is to be preserved as a place of historic interest, and also to provide accommodation for study and research.

Table 16 for the year ended March 31
The following table presents details of the Agency's net financial position (in thousands of dollars):
Restricted 2019 2018
Restated (note 18)
New Parks and Historic Sites Account
Available at beginning of year 39,843 14,761
Receipts:
Parliamentary authorities 44,007 25,546
Proceeds on disposal of tangible capital assets 987 330
Donations 545 3
  45,539 25,879
Capital expenditures 27,777 797
New Parks and Historic Sites Account - Available at end of year 57,605 39,843
Mackenzie King Trust Account 225 225
Restricted - Available at end of year 57,830 40,068
Unrestricted 3,673,580 3,174,725
Net financial position at year end 3,731,410 3,214,793

13. Contractual obligations and contractual rights

a) Contractual obligations

The nature of the Agency's activities may result in some large multi-year contracts and obligations whereby the Agency 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:

Table 17 for the year ended March 31
(in thousands of dollars) 2020 2021 2022 2023 2024 and subsequent Total
Operating leases 924 171 171 140 219 1,625
Purchases and transfer payments 476,173 220,129 43,011 653 2,147 742,113
Total 477,097 220,300 43,182 793 2,366 743,738

b) Contractual rights

The activities of the agency sometimes involve the negotiation of contracts or agreements with outside parties that results in the agency having rights to both assets and revenues in the future. Major contractual rights that will generate revenues in future years and that can be reasonably estimated are summarized as follows:

Table 18 for the year ended March 31
(in thousands of dollars) 2020 2021 2022 2023 2024 and subsequent Total
Leases of property 6,604 6,517 6,636 6,750 170,538 197,045
OtherFootnote 1 2,033 2,049 2,065 2,082 2,099 10,328
Total 8,637 8,566 8,701 8,832 172,637 207,373
Footnote 1

Includes municipal incorporation agreements and residential licenses that do not have an end date, therefore amounts for 2023-24 and subsequent cannot be determined.

Return to footnote 1 referrer

14. Contingent liabilities

Contingent liabilities arise in the normal course of operations and their ultimate disposition is unknown. The Agency's contingent liabilities consist of claims which include items with pleading amounts and other for which no amount is specified. While the total amount claimed in these actions is significant, their outcomes are not determinable. The Agency has recorded an allowance for claims and litigations 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 $1,150,000 at March 31, 2019 ($1,325,000 in 2018).

15. Related party transactions

The Agency 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.

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

a) Common services provided without charge by other government departments

During the year, the Agency 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 the carrying value in the Agency's Statement of Operations and Agency's Net Financial Position as follows:

Table 19 for the year ended March 31
(in thousands of dollars) 2019 2018
Note 17
Employer's contribution to the health and dental insurance plans 36,398 33,118
Accommodation 18,495 17,600
Legal services 171 159
Workers' compensation 131 76
Total 55,195 50,953

The Government has centralized some of its administrative activities for efficiency, cost-effectiveness purposes and economic delivery 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 as well as the email, network and data center services and the workplace technology devices provided by Shared Services Canada are not included in the Agency's Statement of Operations and Agency's Net Financial Position.

(b) Other transactions with other government departments and agencies

Table 20 for the year ended March 31
(in thousands of dollars) 2019 2018
Accounts receivable 5,584 6,531
Accounts payable 39,480 31,756
Expenses 318,062 267,202
Revenues 45,032 26,015
Expenses and revenues disclosed in (b) exclude common services provided without charge, which are already disclosed in (a).

16. Segmented information

Presentation by segment is based on the Agency'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:

Table 21 for the year ended March 31 (in thousands of dollars)
Heritage Places Establishment Heritage Places Conservation Heritage Places Promotion and Public Support Visitor Experience Heritage Canals, Highways and Townsite Management Internal Services 2019 2018
Restated (note 18)
Salaries and employee benefits 7,390 119,982 42,007 208,145 28,711 103,604 509,839 430,141
Operating expenses
Amortization of tangible capital assets 8 9,532 402 66,744 65,183 3,550 145,419 122,512
Professional and special services 311 50,810 4,483 30,237 16,534 15,701 118,076 93,323
Utilities, materials and supplies 500 14,002 1,599 39,069 11,179 1,969 68,318 68,379
Rentals 102 12,638 977 6,709 245 3,485 24,156 32,083
Transportation and communications 719 6,961 2,971 6,073 521 4,102 21,347 23,124
Net loss on disposal of tangible capital assets including adjustments - (12) (700) 10,465 5,371 (379) 14,745 22,594
Payments in lieu of taxes - - - 18,725 - - 18,725 19,000
Repairs and maintenance 13 4,690 38 14,063 5,405 267 24,476 18,687
Accommodation 257 4,280 1,464 7,615 1,173 3,706 18,495 17,600
Information 139 547 4,320 3,493 40 627 9,166 9,171
Miscellaneous expenses - 161 119 (1,292) 89 48 (875) 3,393
Total Operating expenses 2,049 103,609 15,673 201,901 105,740 33,076 462,048 429,866
Grants and contributions 3,643 5,334 9,715 3,610 325 - 22,627 18,407
Total expenses 13,082 228,925 67,395 413,656 134,776 136,680 994,514 878,414
Revenues
Entrance fees - - - 81,350 - - 81,350 15,465
Recreational fees - - - 41,761 - - 41,761 36,881
Rentals and concessions - 1,090 - 23,432 7,004 407 31,933 33,806
Other operating revenues 543 910 100 5,754 983 1,674 9,964 8,064
Townsites revenues - - - - 2,963 - 2,963 3,126
Staff housing - 1,178 - 2,408 - - 3,586 3,544
Revenues from donated properties - - - 16,738 - - 16,738 41,357
Revenues earned on behalf of Government - - - - - (154) (154) (99)
Total revenues 543 3,178 100 171,443 10,950 1,927 188,141 142,144
Net cost from continuing operations 12,539 225,747 67,295 242,213 123,826 134,753 806,373 736,270

17. Comparative information

Comparative figures have been reclassified to conform to the current year’s presentation.

18. Adjustments to prior year's results

In 2018-19, the agency conducted a review of its tangible capital assets. As a result, the agency identified donated tangible capital assets that should have been recorded in the previous fiscal year. This correction has been applied retroactively and comparative information for 2017-18 has been restated.

The effect of this adjustment is presented in the table below.

Table 22 for the year ended March 31 (in thousands of dollars)
2018
As previously stated

Effect of the adjustment
2018
Restated
Statement of Financial Position
Tangible capital assets 3,234,389 41,357 3,275,746
Total non-financial assets 3,246,657 41,357 3,288,014
Net financial position 3,173,436 41,357 3,214,793
Statement of Operations and Net Financial Position
Revenues from donated properties - 41,357 41,357
Total revenues 100,787 41,357 142,144
Net cost of operations before government funding and transfers 777,626 (41,357) 736,269
Net cost of operations after government funding and transfers (469,735) (41,357) (511,092)
Net financial position - End of year 3,173,436 41,357 3,214,793
Statement of Change in Net Debt
Net cost of operations after government funding and transfers (469,735) (41,357) (511,092)
Acquisitions and improvements to tangible capital assets 613,184 41,357 654,541
Total change due to tangible capital assets 473,431 41,357 514,788
Statement of Cash Flows
Net cost of operations before government funding and transfers 777,626 (41,357) 736,269
Acquisitions and improvements to tangible capital assets 613,184 41,357 654,541