Statement of Management Responsibility

 

Return to 2013-2014 Report on Plans and Priorities

 

Responsibility for the compilation, content, and presentation of the accompanying future-oriented financial information for the years ended March 31, 2013 and March 31, 2014 rests with the management of the CRTC. Departmental management is responsible for the information contained in these future-oriented financial statements and for the appropriateness of the assumptions on which these statements are prepared. Assumptions and estimates adopted as at January 23, 2013 are based upon the best information available and known to management at the time of development and reflect the plans described in the Report on Plans and Priorities.

The future-oriented financial statements for the Canadian Radio-television and Telecommunications Commission have not been audited.

 

(the original version was signed by)(the original version was signed by)

Jean-Pierre Blais,
Chairman and CEO
Gatineau, Canada
February 15, 2013
John Traversy,
Secretary General
Gatineau, Canada
February 15, 2013

 


 

Canadian Radio-television and Telecommunications Commission
Future-oriented Statement of Financial Position (Unaudited)
As at March 31
(in thousands of dollars)
The accompanying notes form an integral part of these
future-oriented financial statements.
  Estimated
Results
2012-13
Planned
Results
2013-14
Liabilities    
Accounts payable and accrued liabilities (Note 6) 3,765 3,957
Vacation pay and compensatory leave 1,846 1,845
Employee future benefits (Note 7) 5,206 2,145
Total net liabilities 10,817 7,947
Financial assets    
Due from Consolidated Revenue Fund 3,762 3,954
Accounts receivable and advances (Note 8) 416 428
Total gross financial assets 4,178 4,382
Financial assets held on behalf of Government    
Accounts receivable and advances (Note 8) (73) (98)
Total financial assets held on behalf of Government (73) (98)
Total net financial assets 4,105 4,284
Departmental net debt 6,712 3,663
Non-financial assets    
Prepaid expenses 289 229
Tangible capital assets (Note 9) 3,774 4,690
Total non-financial assets 4,063 4,919
Departmental net financial position (2,649) 1,256

 

Jean-Pierre Blais
Chairman and CEO
Gatineau, Canada
February 15, 2013
 
John Traversy
Chief Financial Officer
Gatineau, Canada
February 15, 2013

 

 

Canadian Radio-television and Telecommunications Commission
Future-oriented Statement of Operations and Departmental
Net Financial Position (Unaudited)
For the Year Ended March 31
(in thousands of dollars)
Segmented information (note 12)
The accompanying notes form an integral part of these
future-oriented financial statements.
  Estimated
Results
2012-13
Planned
Results
2013-14
Expenses    
Canadian Broadcasting 2012-13 21,668
Canadian Content Creation 2013-14 (Note 1) 22,584
Canadian Telecommunications 2012-13 23,464
Connection to the Communication
System 2013-14 (Note 1)
25,930
Internal services 17,899 15,064
Expenses incurred on behalf of Government (69) (75)
Total expenses 62,962 63,503
Revenues    
Rights and privileges 104,752 106,428
Regulatory fees 56,965 60,235
Miscellaneous revenues 158 167
Revenues earned on behalf of Government (118,261) (120,342)
Total revenues 43,614 46,488
Net cost of operations before government
funding and transfers
19,348 17,015
Government funding and transfers    
Net cash provided by Government 13,240 14,336
Change in due from Consolidated Revenue Fund (383) 192
Services provided without charge by other government departments (Note 10) 6,345 6,392
Net revenue from operations after
government funding and transfers
146 (3,905)
Departmental net financial position -
Beginning of year
(2,503) (2,649)
Departmental net financial position -
End of year
(2,649) 1,256

 

Canadian Radio-television and Telecommunications Commission
Future-oriented Statement of Change in Departmental Net Debt (Unaudited)
For the Year Ended March 31
(in thousands of dollars)
The accompanying notes form an integral part of these
future-oriented financial statements.
  Estimated
Results
2012-13
Planned
Results
2013-14
Net revenue from operations after government
funding and transfers
146 (3,905)
Change due to tangible capital assets
Acquisition of tangible capital assets 1,406 2,372
Amortization of tangible capital assets (1,380) (1,456)
Total change due to tangible capital assets 26 916
Change due to prepaid expenses (120) (60)
Net increase (decrease) in departmental net debt 52 (3,049)
Departmental net debt - Beginning of year 6,660 6,712
Departmental net debt - End of year 6,712 3,663

 

Canadian Radio-television and Telecommunications Commission
Future-oriented Statement of Cash Flow (Unaudited)
For the Year Ended March 31
(in thousands of dollars)
The accompanying notes form an integral part of these
future-oriented financial statements.
  Estimated
Results
2012-13
Planned
Results
2013-14
Operating activities    
Net cost of operations before government funding
and transfers
19,348 17,015
Non-cash items:    
Amortization of tangible capital assets (1,380) (1,456)
Services provided without charge by other government departments (Note 10) (6,345) (6,392)
Variations in Statement of Financial Position:    
Increase (decrease) in accounts receivable and advances 136 (13)
Increase (decrease) in prepaid expenses (120) (60)
Decrease (increase) in accounts payable and
accrued liabilities
422 (192)
Decrease (increase) in vacation pay and
compensatory leave
(3) 1
Decrease (increase) in future employee benefits (224) 3,061
Cash used in operating activities 11,834 11,964
Capital investing activities    
Acquisitions of tangible capital assets 1,406 2,372
Cash used in capital investing activities 1,406 2,372
Net cash provided by Government of Canada 13,240 14,336

Canadian Radio-television and Telecommunications Commission

Notes to Future-oriented Financial Statements

1. Authority and Objectives

The Canadian Radio-television and Telecommunications Commission (CRTC) was created by Parliament in 1968 under the Canadian Radio-television and Telecommunications Commission Act. The CRTC reports to Parliament through the Minister of Canadian Heritage.

The CRTC is vested with the authority to regulate and supervise all aspects of the Canadian broadcasting system, as well as the telecommunications services providers and common carriers that come under federal jurisdiction. The CRTC's powers in the area of broadcasting regulation derive from the Broadcasting Act. Its powers over telecommunications come from the Telecommunications Act and from various "special acts" of Parliament passed for specific telecommunications companies.

In December 2010, Royal Assent was granted for Anti-spam legislation entitled An Act to promote the efficiency and adaptability of the Canadian economy by regulating certain activities that discourage reliance on electronic means of carrying out commercial activities, and to amend the Canadian Radio-television and Telecommunications Commission Act, the Competition Act, the Personal Information Protection and Electronic Documents Act and the Telecommunications Act (hereinafter referred to as Anti-spam legislation).Under this legislation, the CRTC has obtained new investigative and enforcement responsibilities and powers to counter spam and malware. The legislation is expected to come into force in 2013-14.

CRTC Programs

The CRTC's Program Alignment Architecture (PAA) in 2012-13 included the programs: Canadian Broadcasting; Canadian Telecommunications; and Internal Services. For fiscal year 2013-14 the CRTC received Treasury Board approval to revise its Program Alignment Architecture (PAA) to the following programs: Canadian Content Creation; Connection to the Communication System; and Internal Services. A description of each program is noted as follows:

2012-13

Canadian Broadcasting

The Broadcasting Act requires that the CRTC regulate and monitor broadcasters and broadcasting services, including radio, television, cable distribution and direct-to-home satellite systems, through the issuance of licenses. This program is important in order to ensure the predominance of Canadian content and by providing Canadians with full access to the broadcasting system, as participants in the industry and as audiences.


Canadian Telecommunications

The Telecommunications Act requires that the CRTC regulate and supervise the telecommunications industry by approving tariffs and fostering competition. The CRTC's regulation of the telecommunications industry is based on an increased reliance on market forces and, where required, effective and efficient regulation. As a result of the CRTC's regulation of the telecommunications industry, Canadians have access to reliable telephone and other high-quality telecommunications services at affordable prices. The CRTC's activities related to the Anti-spam legislation will seek to reduce the volume of unwanted commercial electronic messages and harmful computer programs that Canadians receive, thereby ensuring access to more reliable telecommunications services and increasing confidence in electronic commerce.

2013-14

Canadian Content Creation

This program focuses on ensuring that a wealth of Canadian content is created and made available to all Canadians on a variety of platforms. Through its orders, decisions, licensing frameworks and other regulatory activities, the Canadian Radio‑television and Telecommunications Commission encourages the creation of diverse programming that reflects the attitudes, opinions, ideas, values and artistic creativity of Canadians. By requiring the display of Canadian content in entertainment programming and the provision of information and analysis concerning Canada, the CRTC is enabling Canadians to better participate in their country's democratic and cultural life.


Connection to the Communication System

The Canadian Radio‑television and Telecommunications Commission facilitates the orderly development of a communication system for all Canadians in order to strengthen the social and economic fabric of Canada and enhance the safety and interests of Canadians. This program focuses on ensuring that Canadians can connect to a choice of accessible, innovative and quality communication services at affordable prices, and can have access to compelling and creative Canadian content. Through this program, the Canadian Radio‑television and Telecommunications Commission promotes compliance with and enforcement of its various laws and regulations, including unsolicited communications. It helps to ensure that Canadians have access to emergency communication services such as 9‑1‑1 service and alerting systems. As a result, Canadians have increased protection and benefit from a more secure communications system.

The Program description for Internal Services is the same for both 2012-13 and 2013-14.

Internal Services

Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization. These groups 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; Acquisition Services; and Travel and Other Administrative Services. Internal Services include only those activities and resources that apply across an organization and not to those provided specifically to a program.

2. Methodology and significant assumptions

These future-oriented statements have been prepared on the basis of the government priorities and the plans of the department as described in the Report on Plans and Priorities.

The main assumptions are as follows:

  1. The department's operating activities will remain substantially the same as for the previous year.
  2.  Expenses and revenues, including the determination of amounts internal and external to the government, are based on historical experience. A new regulatory fee is being introduced in 2013-14 (effective April 1, 2013) under the authority of the Telecommunications Act and the Unsolicited Telecommunications Fees Regulations. This fee will be charged to telemarketers in order to recover the CRTC's investigation and enforcement costs associated with the National Do Not Call List (DNCL). Previously, the activities related to the DNCL were funded on a temporary basis through Parliamentary appropriations. As a result, regulatory fee revenue is expected to increase by $3.3 million for 2013-14 with the introduction of this new fee. Aside from this new fee, the general historical pattern for expenses and revenues is expected to continue.
  3. It is not possible to accurately forecast revenues related to administrative monetary penalties (AMPs) associated with compliance and enforcement activities for the National DNCL. Amounts may vary significantly from year to year based on the level of compliance by telemarketers as well as the number of investigations conducted and completed by CRTC's DNCL staff.
  4. Allowances for uncollectibility are based on historical experience. The general historical pattern is expected to continue.
  5. The information in the estimated results for fiscal year 2012-13 is based on actual results as at November 30th 2012 and forecast for the remainder of the fiscal year. Estimated year end information for 2012-13 is used as the opening position for the 2013-14 planned results.

The assumptions are adopted as at January 23rd, 2013.

3. Variations and Changes to the Forecast Financial Information

While every attempt has been made to accurately forecast final results for the remainder of 2012-13 and for 2013-14, actual results achieved for both years are likely to vary from the forecast information presented, and this variation could be material.

In preparing these future-oriented financial statements the CRTC has made estimates and assumptions concerning the future. These estimates and judgements may differ from the subsequent actual results. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Factors that could lead to material differences between the future-oriented financial statements and the historical financial statements include:

  1. Implementation of new collective agreements.
  2. The timing and amounts of acquisitions and disposals of property, plant and equipment may affect gains/losses and amortization expense.
  3. Further changes to the operating budget through additional new initiatives or technical adjustments later in the year.

Once the Report on Plans and Priorities is presented, the CRTC will not be updating the forecasts for any changes to authorities or forecast financial information made in ensuing estimates. Variances will be explained in the Departmental Performance Report.

4. Summary of significant accounting policies

The future-oriented financial information has been prepared in accordance with Treasury Board accounting policies stated below, which are based on Canadian generally accepted accounting principles for the public sector. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian generally accepted accounting principles.

Significant accounting policies are as follows:

  1. Parliamentary authorities and vote-netting ‑ The CRTC is financed in part by the Government of Canada through Parliamentary authorities (e.g. Statutory Vote for Employee Benefits Plans (EBP), Budgetary Vote for the Anti-spam legislation activities) and the balance by vote-netted fees it collects from the broadcasting, telecommunications and telemarketing industries. Vote-netting is a means of funding selected programs or activities wherein Parliament authorizes a department to apply revenues collected from fee payers towards costs directly incurred for specific activities. CRTC has the authority to use a portion of: a) the Part I licence fees collected from broadcasters; b) the annual telecommunications fees collected from telecommunications carriers; and c) the unsolicited telecommunications fees from telemarketers (starting in 2013-14) to finance the costs it incurs in discharging its statutory responsibilities under the Broadcasting Act and Telecommunications Act (i.e. respendable revenue). The balance of these three fees recovers the costs for items funded through budgetary authorities (e.g. EBP) and costs incurred by other government departments on the CRTC's behalf and are classified as non-respendable revenue. Part II broadcasting licence fees are entirely classified as non-respendable revenue.
    The cash accounting basis is used to recognize transactions affecting parliamentary authorities. The future-oriented financial statements are based on accrual accounting. Consequently, items recognized in the Future-oriented Statement of Operations and the Future-oriented Statement of Financial Position are not necessarily the same as those provided through fee collection and through authorities from Parliament.
  2. Net cash provided to Government ‑ The CRTC operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the CRTC is deposited to the CRF and all cash disbursements made by the CRTC are paid from the CRF. The net cash provided to Government is the difference between all cash receipts and all cash disbursements including transactions between departments of the Government.
  3. Amounts due from/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 CRTC is entitled to draw from the CRF without further parliamentary expenditure authorities to discharge its liabilities.
  4. Revenues ‑ The CRTC collects fees under the authority of the Broadcasting Act and Telecommunications Act and the regulations made pursuant to these Acts, namely the Broadcasting Licence Fee Regulations, 1997 the Telecommunications Fees Regulations, 2010, and the Unsolicited Telecommunications Fees Regulations. These fees are accounted for in the period in which the underlying transaction or event occurs that give rise to the revenues. The CRTC's regulatory fees (Part I broadcasting licence fees, annual telecommunications fees, and unsolicited telecommunications fees) recover the CRTC's costs associated with its programs. The Part II licence fees are regulatory charges imposed in relation to a broadcaster's privilege for holding a broadcasting licence (i.e. rights and privileges). These fees recover part of the Government of Canada's substantial annual investment in the Canadian broadcasting system.
  5. Expenses ‑ Expenses are recorded on an accrual basis:
    1. Vacation pay and compensatory leave are accrued as the benefits are earned by employees under their respective terms of employment
    2. Services provided without charge by other government departments for accommodation, the employer's contribution to the health and dental insurance plans, and worker's compensation are recorded as operating expenses at their estimated cost.
  6. Employee future benefits
    1. Pension benefits ‑ Eligible employees participate in the Public Service Pension Plan, a multi-employer plan administered by the Government of Canada. The CRTC's contributions to the Plan are charged to expenses in the year incurred and represent the total departmental obligation to the Plan. Current legislation does not require the CRTC to make contributions for any actuarial deficiencies of the Plan.
    2. Severance benefits ‑ Employees are entitled to severance benefits under labour contracts or conditions of employment. These benefits are accrued as employees render the services necessary to earn them. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.
  7. Accounts receivables are stated at the lower of costs and net recoverable value; a valuation allowance is established for receivables where recovery is considered uncertain.
  8. Tangible capital assets – All tangible capital assets and leasehold improvements having an initial cost of $5,000 or more are recorded at their acquisition cost. The CRTC does not capitalize intangibles, works of art and historical treasures that have cultural, aesthetic or historical value.

    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
    Informatics equipment 3 years
    Informatics software 5 years
    Vehicles 5 years
    Equipment 5 years
    Leasehold improvements 25 years

  9. Measurement uncertainty - The preparation of these future-oriented financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the future-oriented financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. Actual results could significantly differ from those estimated.

5. Parliamentary authorities

The CRTC receives the major portion of its funding through fees assessed to the broadcasting, telecommunications and telemarketing industries as well as a portion from Parliamentary authorities. Since Parliamentary authorities are not calculated on the accrual accounting basis, the CRTC 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) Authorities requested

Authorities requested
  Estimated
2012-13
Planned
2013-14
  (in thousands of dollars)
Vote 50 - Operating expenditures 11,039 10,248
Statutory amounts 6,311 6,803
Less:    
Forecast authorities available for future years (2,345) (2,510)
Forecast lapsed: Operating (2,323) -
Current year forecast authorities available 12,682 14,541

Authorities presented reflect current forecasts of statutory items, approved initiatives included and expected to be included in Estimates documents and, when reasonable estimates can be made, estimates of amounts to be allocated from Treasury Board central votes.

(b) Reconciliation of net revenue of operations to requested authorities:

  Estimated
2012-13
Planned
2013-14
(in thousands of dollars)
Net cost of operations before government funding and transfers 19,348 17,015
Adjustments for items affecting net revenue of operations but not affecting authorities:    
Decrease (increase) in employee future benefits (224) 3,061
Services provided without charge by other government departments (6,345) (6,392)
Amortization of tangible capital assets (1,380) (1,456)
Decrease (increase) in vacation pay and compensatory leave (3) 1
Sub-total (7,952) (4,786)
Adjustments for items not affecting net revenue of operations but affecting authorities:    
Acquisitions of tangible capital assets 1,406 2,372
Increase (decrease) in prepaid expenses (120) (60)
Sub-total 1,286 2,312
Forecast authorities available 12,682 14,541

6. Accounts payable and accrued liabilities

The following table presents details of the CRTC's accounts payable and accrued liabilities:

 
  Estimated
Results
2012-13
Planned
Results
2013-14
  (in thousands of dollars)
Accounts payable to other government departments and agencies 348 225
Accounts payable to external parties 2,401 2,549
Total accounts payable 2,749 2,774
Accrued liabilities 1,016 1,183
Total accounts payable and accrued liabilities 3,765 3,957

7. Employee future benefits

(a) Pension benefits:

The CRTC's employees participate in the Public Service Pension Plan, which is sponsored and administered by the Government. 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 Plans benefits and they are indexed to inflation.

Both the employees and the CRTC contribute to the cost of the Plan. The forecast expenses are $4.5 million in 2012-13 and $4.8 million in 2013-14, representing approximately 1.8 times the contributions of employees.

The CRTC's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the financial statements of the Government of Canada, as the Plan's sponsor.

(b) Severance benefits:

The CRTC provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future authorities. Information about the severance benefits, estimated as at the date of these statements, is as follows:

  Estimated
Results
2012-2013
Planned
Results
2013-14
  (in thousands of dollars)
Accrued benefit obligation, beginning of year 4,982 5,206
Expense for the year 921 32
Expected benefits payments during the year (697) (3,093)
Accrued benefit obligation, end of year 5,206 2,145

8. Accounts receivable and advances

The following table presents details of the CRTC's accounts receivable and advances balances:

  Estimated
Results
2012-13
Planned
Results
2013-14
  (in thousands of dollars)
Receivables from other government departments and agencies 142 154
Receivables from external parties 488 563
Employee advances 3 3
Subtotal 633 720
Allowance for doubtful accounts on receivables from external parties (217) (292)
Gross accounts receivables 416 428
Accounts receivables held on behalf of Government - National Do Not call List (Administrative Monetary Penalties) (73) (98)
Net accounts receivable 343 330

9. Tangible capital assets (in thousands of dollars)

Cost
Capital asset class Opening balance Acquisitions Disposals and write-offs Closing balance
Equipment 232 - - 232
Vehicles 54 - - 54
Informatics
Equipment
2,956 1,172 - 4,128
Informatics
Software
8,522 1,200 - 9,722
Leasehold
Improvements
346   - 346
Total 12,110 2,372 0 14,482

 

Accumulated amortization
Capital asset class Opening balance Amortization Disposals and write-offs Closing balance
Equipment 230 2 - 232
Vehicles 41 5 - 46
Informatics
Equipment
2,429 329 - 2,758
Informatics
Software
5,602 1,106 - 6,708
Leasehold
Improvements 
34 14 - 48
Total 8,336 1,456 0 9,792

 

Net book value
Capital asset class 2013 2014
Equipment 2 0
Vehicles 13 8
Informatics
Equipment
527 1,370
Informatics
Software
2,920 3,014
Leasehold
Improvements 
312 298
Total 3,774 4,690

10. Related party transactions

The CRTC is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. CRTC enters into transactions with these entities in the normal course of business and on normal trade terms. During the year, the CRTC received common services which were obtained without charge from other Government departments as disclosed below.

(a) Common services provided without charge by other government departments

During the year, the CRTC receives services without charge from certain common service organizations, related to accommodation, the employer's contribution to the health and dental insurance plans and worker's compensation coverage. These services provided without charge have been recorded in the Department's Future-oriented Statement of Operations and Departmental Net Financial Position as follows:

  Estimated
Results
2012-2013
Planned
Results
2013-2014
(in thousands of dollars)
Employer's contribution to the health and dental insurance plans 3,193 3,245
Accommodation 3,059 3,059
Worker's Compensation 93 88
Total 6,345 6,392

Other services provided without charge to the CRTC as noted above are a component of the Part I broadcasting licence fee and the annual telecommunications fee collected by the CRTC.

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 payroll and cheque issuance services provided by Public Works and Government Services Canada and audit services provided by the Office of the Auditor General of Canada, are not included in the CRTC's Future-oriented Statement of Operations and Departmental Net Financial Position, nor are they recovered as a component of any of the CRTC fees.

(b) Other transactions with related parties:

  Estimated
Results
2012-2013
Planned
Results
2013-2014
  (in thousands of dollars)
Accounts receivable - Other government departments and agencies (Note 8) 142 154
Accounts payable - Other government departments and agencies (Note 6) 348 225
Expenses - Other government departments and agencies 1,916 1,831

11. Revenues

(a) Rights & Privileges

Part II licence fees ‑The Broadcasting Licence Fee Regulations, 1997 were amended in 2010 (Broadcasting Regulatory Policy CRTC 2010-476). A cap of $100 million was introduced for the calculation of Part II broadcasting licence fees assessed in 2010-11. This cap is adjusted annually on a compound basis in accordance with the percentage increase or decrease to the Consumer Price Index (CPI) for the calendar year prior to the year of the adjustment. The CPI index was 1.8% for fiscal year 2011-12, 2.9% for fiscal year 2012-13 and estimated at 1.6% for 2013-14. The CPI is the annual average all-items CPI for Canada that is published by Statistics Canada.

These fees recover part of the Government of Canada's substantial annual investment in the Canadian broadcasting system.

(b) Regulatory Fees

The CRTC collects fees under the authority of regulations in the Broadcasting Act and Telecommunications Act.

Broadcasting licence fees ‑Section 11 of the Broadcasting Act gives the Commission the authority to make regulations respecting licence fees. These regulations apply to most licensees, who are required to pay their Part I and Part II licence fees to the Commission annually. The last amendment to the Broadcasting Licence Fee Regulations was done in 2010. Details on the amendment can be found in Broadcasting Regulatory Policy CRTC 2010-476 on the CRTC website. The Broadcasting Licence Fee Regulations can be found on the Department of Justice web site.

Part I licence fees ‑Part I licence fees are based on the broadcasting regulatory costs incurred each year by the Commission and other federal departments or agencies, and are equal to the aggregate of:

The CRTC's estimated broadcasting regulatory costs are set out in its Expenditure Plan published in Part III of the Estimates of the Government of Canada (Report on Plans and Priorities).

There is an annual adjustment ('true-up') amount to the Part I fee to adjust estimated costs to actual expenditures. Any excess fees or shortfalls are credited or charged to the licensee in a following year's invoice.

Telecommunications fees ‑ Section 68 of the Telecommunications Act grants the CRTC authority to create the Telecommunications Fees Regulations.

The Telecommunications Fees Regulations amended in March 2010 (Telecom Decision CRTC 2010‑183 dated 25 March 2010) requires all telecommunications service providers (TSPs), or groups of related TSPs, with at least $10 million dollars in Canadian telecommunications service revenues (CTSR) to pay telecommunications fees, whether or not they file a tariff for approval with the Commission. The Telecommunications Fees Regulations can be found on the Department of Justice web site.

The CRTC's annual telecommunications fees are equal to the aggregate of:

The CRTC's estimated telecommunications regulatory costs are set out in its Expenditure Plan, published in Part III of the Estimates of the Government of Canada (Report on Plans and Priorities).

There is an annual adjustment ('true-up') amount to the telecommunications fees to adjust estimated costs to actual expenditures. Any excess fees or shortfalls are credited or charged to the carriers in the following year's invoice.

Unsolicited Telecommunications Fees - Section 41.21(1) of the Telecommunications Act grants the CRTC authority to create the Unsolicited Telecommunications Fees Regulations. These fees recover the CRTC's investigation and enforcements costs, associated with the National Do Not Call List (DNCL), from telemarketers.

On June 29, 2012 Bill C-38 "An Act to Implement Certain Provisions of the Budget Tabled in Parliament on March 29, 2012 and other measures" received Royal Assent. As part of this Bill, changes to the Telecommunications Act (e.g. section 41.21(1)) were approved that allow the Commission to make regulations prescribing fees for the purposes of recovering all or a portion of the costs that the Commission determines to be attributable to its responsibilities under section 41.2 and following of the Telecommunications Act.

In accordance with section 41.21(3) of the Act, the CRTC issued a Notice of Consultation (NoC # 2012-588) on October 23, 2012. In this NoC, the CRTC was seeking comments on the new "Unsolicited Telecommunications Fees Regulations" that, when implemented, will be used to fund the CRTC's DNCL investigation and enforcement activities, on a cost recovery basis, from fees assessed to telemarketers. The Commission considered public comments received and approved these new fees regulations in (Decision 2013-26) that will come into effect on April 1, 2013, for the 2013-14 fiscal year.

For 2013-14 the CRTC will be seeking to recover $3.3 million in costs though the fees assessed to telemarketers. The fee schedule is contained in a schedule to the regulations.

These fees will be collected by the Commission's delegate (National DNCL List Operator) and remitted to the Commission for deposit to the Consolidated Revenue Fund. In the event that, in any given fiscal year, the amount collected exceeds the Commission's approved budgetary authorities (i.e. $3.3 million for 2013-14), the regulations set out a refund mechanism to refund telemarketers any excess fees paid.

The Unsolicited Telecommunications Fees Regulations can be found on the Department of Justice web site.

(c) Other Revenues

Other revenues is comprised of: (a) interest on overdue accounts receivable for CRTC broadcasting licence fees, telecommunications fees and administrative monetary penalties (AMPs), (b) DNCL AMPS, (c) miscellaneous non tax revenue (e.g. access to information fees), and (d) gain on disposal of non-capital assets to outside parties.

12. Segmented information

Presentation by segment is based on the CRTC'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 4. The following table presents the projected expenses and revenues for the main program activities, by major object of expense and by major type of revenue. The segment results for the period are as follows:

(in thousands of dollars)
  2012-13 Estimated Results Total Canadian Content Creation Connection to the Communications System Internal services 2013-14 Planned Results Total
Expenses          
Salaries and employee benefits 47,844 17,669 20,282 11,618 49,569
Professional and special services 4,346 1,047 1,297 1,313 3,657
Accommodation 3,059 1,107 1,242 710 3,059
Travel and relocation 1,880 597 671 383 1,651
Amortization 1,381 728 728 - 1,456
Rentals 914 469 527 301 1,297
Information, advertising and communications services 1,149 384 431 246 1,061
Repair and maintenance 776 256 287 164 707
Furniture and equipment 1,217 155 197 219 571
Materials and supplies 389 171 192 109 472
Bad debt 69 - 75 - 75
Other 7 1 1 1 3
Expenses incurred on behalf of Government (69) - (75) - (75)
Total expenses  62,962  22,584  25,855  15,064  63,503
Revenues (Note 4(d))          
Rights and privileges 104,752 106,428 - - 106,428
Regulatory fees 56,965 23,399 21,487 15,349 60,235
Other revenues 158 9 158 - 167
Revenues earned on behalf of Government (118,261) (113,992) (6,350) - (120,342)
Total revenues  43,614  15,844  15,295  15,349  46,488
Net cost of operations before government funding and transfers  19,348  6,740  10,560  (285)  17,015

 

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