ARCHIVED - Indian and Northern Affairs Canada Financial Statements for the Year Ended March 31, 2007 (Unaudited)

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Date: March 2007

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Table of Contents


2006-2007 Financial Statements

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2007 and all information contained in these statements rests with the management of Indian and Northern Affairs Canada (INAC). These financial statements have been prepared by management in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

Management is responsible for the integrity and objectivity of the information in these financial statements. Some of the information in the financial statements is based on management's best estimates and judgment and gives due consideration to materiality. To fulfil its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of INAC's financial transactions. Financial information submitted to the Public Accounts of Canada and included in the department's Departmental Performance Report is consistent with these financial statements.

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

The financial statements of INAC have not been audited.

Michael Wernick, Deputy Minister
Jim Quinn, Chief Financial Officer
Gatineau, Canada
Date: August 8th, 2007

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Statement of Operations

(in thousands of dollars)

EXPENSES (Note 4) 2007 2006
People 3,348,986 3,360,637
Economy 1,759,212 1,354,578
Government 832,981 771,454
Land 604,369 331,722
Office of the Federal Interlocutor 38,353 40,650
Total Expenses 6,583,901 5,859,041

REVENUES (Note 5) 2007 2006
People 14 14
Economy 11,442 10,716
Government 7,352 12,303
Land 189,312 245,689
Office of the Federal Interlocutor   20
Total Revenues 208,120 268,742

Net Cost of Operations 6,375,781 5,590,299

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Statement of Financial Position

(in thousands of dollars)

ASSETS 2007 2006
Financial assets    
Accounts receivable (Note 6) 147,040 76,963
Loans and advances (Note 7) 711,687 679,683
Total financial assets 858,727 756,646
Non-financial assets    
Prepaid expenses 28,165 29,956
Tangible capital assets (Note 8) 38,990 22,624
Total non-financial assets 67,155 52,580
TOTAL 925,882 809,226

LIABILITIES 2007 2006
Accounts payable and accrued liabilities 753,619 628,644
Vacation pay and compensatory leave 16,207 17,074
Other liabilities 75,484 94,939
Trust accounts (Note 12) 993,724 1,026,689
Environmental liabilities (Note 10) 1,313,856 1,071,014
Liability for claims and litigation (Note 10) 9,785,811 9,415,193
Settled claims 642,160 831,489
Employee severance benefits (Note 9) 56,349 53,199
TOTAL 925,882 809,226
Equity of Canada (12,711,328) (12,329,015)
TOTAL 925,882 809,226

Contingent liabilities (Note 10)
Contractual obligations (Note 11)
The accompanying notes form an integral part of these financial statements

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Statement of Equity

(in thousands of dollars)

2007 2006
Equity of Canada, beginning of the year (12,329,015) (12,719,705)
Net cost of operations (6,375,781) (5,590,299)
Current year appropriations used (Note 3) 6,086,238 5,824,235
Revenue not available for spending (208,120) (268,724)
Change in net position in the Consolidated Revenue Fund (Note 3) 39,623 356,639
Services received without charge from other government departments (Note 13) 72,381 68,839
Transfer in of Aboriginal Business Canada and First Nations SchoolNet from Industry Canada 3,346  
Equity of Canada, end of year (12,711,328) (12,329,015)

The accompanying notes form an integral part of these financial statements

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Statement of Cash Flow

(in thousands of dollars)

Operating activities 2007 2006
Net cost of operations 6,375,781 5,590,299
Non-cash items:    
Amortization of tangible capital assets (5,243) (4,956)
Gain (loss) on disposal and write-down of tangible capital assets (1,433) 77
Services provided without charge (72,381) (68,839)
Adjustments to tangible capital assets 12,342  
Transfer in of Aboriginal Business Canada and First Nations SchoolNet from Industry Canada (3,346)  
Variations in Statement of Financial Position    
Increase (decrease) in accounts receivable 70,077 (38,946)
Increase (decrease) in loans and advances 32,004 39,766
Increase (decrease) in prepaid expenses (1,791) (13,404)
Decrease (increase) in liabilities (498,969) 408,545
Cash used by operating activities 5,907,041 5,912,542

Capital investment activities 2007 2006
Acquisitions of tangible capital assets 11,682 5,119
Proceeds from disposal of tangible capital Assets (982) (5,511)
Cash used by capital investment activities 10,700 (392)

Financing activities 2007 2006
Net cash provided by Government of Canada 5,917,741 5,912,150

The accompanying notes form an integral part of these financial statements

INDIAN AND NORTHERN AFFAIRS CANADA
Notes to Financial Statements (Unaudited)

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Authority and Objectives

Indian and Northern Affairs Canada (INAC) was created in 1966 to provide basic services to First Nations, such as education and housing, road maintenance, and water and sewer systems. Today, the department is evolving towards an advisory, funding, and supportive agency in its relations with First Nations, Inuit and Northerners.

INAC financial statements are presented along five major Strategic Outcome lines.

Government
Under this strategic outcome, activities support good governance, effective institutions and co-operative relationships as the foundation for self-reliant and self-sufficient First Nations, Inuit and Northerners. Building trust and effective accountability between First Nations, Inuit and Northerners and their governments is a prerequisite to success.

People
This strategic outcome promotes First Nations' access to a range and level of services reasonably comparable to those enjoyed by other Canadians. By ensuring that basic needs are met, and by focusing on education, this strategic outcome looks at key socioeconomic indicators to effect real change.

Land
This strategic outcome promotes efficient land management practices that address the Crown's existing obligation to protect, conserve and manage lands and the environment; resource management consistent with the principles of sustainable development; and First Nations' aspirations to control of their lands and resources.

Economy
This strategic outcome concentrates on establishing a supportive investment/business climate to enable First Nations, Inuit and northern individuals, communities and businesses to seize economic opportunities. It also focuses on building the economic and community foundations necessary to increase Aboriginal and northern participation in the economy.

Office of the Federal Interlocutor
This strategic outcome is designed to work towards achieving practical ways of improving socio-economic conditions for Métis and Non-Status Indians and urban Aboriginal people; to develop, maintain and nurture good relationships with Métis and Non-Status Indian groups and organizations, urban Aboriginal Canadians, and provincial governments and municipalities (especially in western Canada); and to help Métis and Non-Status Indian organizations to become more self-sufficient, better able to represent their members when engaging with federal and provincial governments, and more accountable to their members and to federal and provincial governments for public funding.

INDIAN AND NORTHERN AFFAIRS CANADA
Notes to Financial Statements (Unaudited)

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Summary of Significant Accounting Policies

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

Significant accounting policies are as follows:

Asset Class Amortization period
Buildings:  
Residential mobile 10 years
Administrative, institutional, recreational and residential 40 years
Works and Infrastructure 30 years
Machinery and equipment:  
Communications equipment 5 years
Lab, scientific and testing equipment 10 years
Construction, excavating and clearing equipment 15 years
Generating equipment 15 years
Informatics hardware 3 years
Informatics software 3 years
Ships and boats 10 years
Motor vehicles::  
Passenger vehicles and light trucks "<" 1 ton 5 years
Heavy trucks ">" 1 ton 10 years
Other vehicles 5 years
Leasehold improvement Lesser of useful life or term of lease
Assets under construction Once in service, in accordance with asset type

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Parliamentary Appropriations

INAC receives most of its funding through annual Parliamentary appropriations. Items recognized in the statement of operations and the statement of financial position in one year may be funded through Parliamentary appropriations in prior, current or future years. Accordingly, INAC has different net results of operations for the year on a government funding basis than on an accrual accounting basis. The differences are reconciled in the following tables:

a) Reconciliation of net cost of operations to current year appropriations used:

  2007 2006
Net cost of operations 6,375,781 5,590,299

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

Add (Less): 2007 2006
Services provided without charge (72,381) (68,839)
Amortization of tangible capital assets (5,243) (4,956)
Revenue not available for spending 208,120 268,724
Employee severance benefits (3,150) (7,497)
(Loss) Gain on disposal of tangible capital assets (1,433) 77
Liability for claims against the Department (370,618) 445,737
Expenses related to environmental liabilities (242,843) (99,963)
Expenses for settled claims 189,329 (258,917)
Others (1,215) (32,145)
Total 6,076,347 5,832,520

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

  2007 2006
Capital acquisitions 11,682 5,119
Prepaid expenses (1,791) (13,404)
Current year appropriations used 6,086,238 5,824,235

b) Appropriations provided and used

  2007 2006
Vote 1 Operating Expenditures 702,783 604,813
Vote 5 Capital Expenditures 25,308 22,758
Vote 10 Grants and Contributions 5,375,668 5,005,289
Vote 15 Payment to Canada Post Corporation 40,900 40,900
Vote 20 Office of the Federal Interlocutor - Operating expenditures 7,805 7,989
Vote 25 Office of the Federal Interlocutor - Contributions 30,654 30,394
Statutory Amounts 261,855 297,428
Less:    
Appropriations available for future years (33,107) (29,978)
Lapsed appropriations: Operating (325,628) (155,358)
Current year appropriations used 6,086,238 5,824,235

c) Reconciliation of net cash provided by Government to current year appropriations used

  2007 2006
Net cash provided by Government 5,917,741 5,912,150
Revenue not available for spending 208,120 268,724
Change in net position in the Consolidated Revenue Fund    
Variation in accounts receivable and advances (70,077) 38,946
Variation in loans and advances (32,004) (39,766)
Variation in accounts payable and accrued liabilities 124,975 (53,966)
Variation in trust accounts (32,965) (272,849)
Other adjustments (29,552) (29,004)
  (39,623) (356,639)
Current year appropriations used 6,086,238 5,824,235

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Expenses

The following table presents details of expenses by category:

  2007 2006
Payments to or on behalf of aboriginals 4,132,956 4,440,010
Transfers to other levels of government 673,639 647,528
Transfers to industry 294,800 276,560
Transfers to non-profit organizations 37,818 38,946
Assistance to Encourage Employment 13,056 0
Other transfers to individuals 2,421 1,081
Total transfer payments 5,154,690 5,401,329
Salaries and employee benefits 380,053 371,588
Claims and Litigation 370,618 (445,737)
Professional Services 262,176 235,365
Contaminated Sites 242,843 99,963
Travel and relocation 40,362 39,091
Canada Post Corporation 39,311 40,900
Operating expenses 36,001 66,220
Accommodations 26,789 25,577
Court Awards and other settlements 23,625 5,158
Amortization 5,243 4,956
Loss on Disposal of tangible capital assets 1,748  
Service charges and fees 281 406
Bad debts 155 14,227
Loss (Gain) on Foreign Exchange 6 (2)
Total operating expenses 1,429,211 457,712
Total Expenses 6,583,901 5,859,041

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Revenues

The following table presents details of expenses by category:

  2007 2006
Payments to or on behalf of aboriginals 4,132,956 4,440,010
Transfers to other levels of government 673,639 647,528
Transfers to industry 294,800 276,560
Transfers to non-profit organizations 37,818 38,946
Assistance to Encourage Employment 13,056 0
Other transfers to individuals 2,421 1,081
Total transfer payments 5,154,690 5,401,329
Salaries and employee benefits 380,053 371,588
Claims and Litigation 370,618 (445,737)
Professional Services 262,176 235,365
Contaminated Sites 242,843 99,963
Travel and relocation 40,362 39,091
Canada Post Corporation 39,311 40,900
Operating expenses 36,001 66,220
Accommodations 26,789 25,577
Court Awards and other settlements 23,625 5,158
Amortization 5,243 4,956
Loss on Disposal of tangible capital assets 1,748  
Service charges and fees 281 406
Bad debts 155 14,227
Loss (Gain) on Foreign Exchange 6 (2)
Total operating expenses 1,429,211 457,712
Total Expenses 6,583,901 5,859,041

The following table presents details of revenues by category:

  2007 2006
Return on investment from outside the Government 135,352 142,889
Rights and privileges 34,423 92,726
Miscellaneous 32,547 28,414
Lease "&" use of public property 4,413 3,885
Other Revenue 1,385 828
Total Revenue 208,120 268,742

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Accounts receivable

The following table presents details of accounts receivable:

  2007 2006
Receivables from other government departments 54,463 29,450
Receivables from external parties 114,259 69,121
  168,722 98,571
Less: allowance for doubtful accounts on external receivables (21,682) (21,608)
Total 147,040 76,963

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Loans and advances

  2007 2006
Native Claimants 410,657 391,319
First Nations in British Columbia 366,299 337,996
Loans on expired loan guarantees 23,103 14,929
Council of Yukon First Nations - Elders 8,710 9,495
Other Loans and Advances 530 547
  809,299 754,286
Less: allowance for doubtful accounts (97,612) (74,603)
Total 711,687 679,683

Native Claimants

Loans have been made to native claimants, to defray the costs related to the research, development and negotiation of claims.

During the year, loans were authorized by Indian Affairs and Northern Development Vote L30 and L30a, Appropriation Act No.2 and No. 3 2006-2007.

The terms and conditions of the loans are as follows:

(a) loans made before an agreement-in-principle for the settlement of a claim is reached are non-interest bearing;
(b) loans made after the date on which an agreement-in-principle for the settlement of a claim has been reached, bear interest at a rate equal to the rate established by the Minister of Finance in respect of borrowings for equivalent terms by Crown corporations; and,
(c) loans are due and payable, as to principal and interest, on the date on which the claim is settled, or on a date fixed in the agreement.

The interest bearing and the non-interest bearing portions of the loans outstanding at year end are $140,143,513 and $270,513,603 respectively

First Nations in British Columbia

Loans have been made to First Nations in British Columbia, to support their participation in the British Columbia Treaty Commission process related to the research, development and negotiation of treaties.

During the year, loans were authorized by Indian Affairs and Northern Development Vote L35, Appropriation Act No.2, 2006-2007.

The terms and conditions of the loans are as follows:

(a) loans made before an agreement-in-principle for the settlement of a treaty is reached are non-interest bearing;
(b) loans made before April 1, 2004 and after the date on which an agreement-in-principle for the settlement of a treaty has been reached, bear interest at a rate equal to the rate established by the Minister of Finance in respect of borrowings for equivalent terms by Crown corporations;
(c) loans made between April 1, 2004 and March 31, 2009, and after the date on which an agreement-in-principle for the settlement of a treaty has been reached, shall be interest free unless the loans become due and payable during this period; and
(d) loans are due and payable by the First Nation and the loan will be paid on the earliest of the following dates:

The interest-bearing and non-interest bearing portions of the loans outstanding at year end are $54,059,828 and $312,238,927 respectively.

Loans on Expired Loan Guarantees

The expired loan guarantees are the outstanding balances of principal and other amounts that were paid out of the Consolidated Revenue Fund

Council of Yukon First Nations - Elders

Loans have been made to the Council of Yukon First Nations, to provide interim benefits to elderly Yukon Indians pending settlement of Yukon Indian land claims.

During the year, loans were authorized by Indian Affairs and Northern Development Votes L30 and L30a, Appropriation Acts No. 2 and No.3, 2006-2007.

The terms and conditions of the loans are as follows:

(a) loans made before an agreement-in-principle for the settlement of a claim is reached are non-interest bearing;
(b) loans made after the date on which an agreement-in-principle for the settlement of a claim has been reached, bear interest at a rate equal to the rate established by the Minister of Finance in respect of borrowings for equivalent terms by Crown corporations; and,
(c) loans are due and payable, as to principal and interest, on the date on which the claim is settled or on a date fixed in the agreement, which shall be no later than March 31,2007, whichever date is earlier.

Other Loans and Advances

Inuit Loan Fund

Loans have been made to individual Inuit or groups of Inuit, to promote commercial activities and gainful occupations. Loans have also been made to co-operative associations, credit unions, caisses populaires or other credit societies incorporated under provincial laws, where the majority of members are Inuit, or to corporations incorporated under the laws of Canada, or provincial laws, where the controlling interest is held by Inuit. One loan is remaining with an interest rate of 5.50 percent per annum.

Indian Economic Development Fund

Loans have been made for the purposes of economic development, to Indians or Indian Bands, to individuals, partnerships or corporations, the activities of which contribute or may contribute to such development. Loans bear interest at a rate equal to the rate established by the Minister of Finance in respect of borrowings for equivalent terms by Crown corporations.

Stoney Band Perpetual Loan

In 1946, Loans were made to Stoney Band of Alberta for land acquisition beyond their treaty entitlement. A loan not exceeding $500,000 was made to purchase additional land. The expended amount of the loan bears interest at a rate of 3.00 percent per annum.

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Tangible Capital Assets

(in thousands of dollars)

  Cost Accumulated amortization  
Capital
asset
class
Opening
balance
Acqui
sitions
Disposals
and
writeoffs
Closing
balance
Opening
balance
Amortiz
ation
Disposals
and
writeoffs
Closing
balance
2007
Net
book
value
2006
Net
book
value
Land 702   (96) 606         606 702
Buildings 29,030   (14) 29,016 12,509 812 (2,140) 11,181 17,835 16,521
Work
and
Infrastructure
1,432   (23) 1,409 1,146 48 (14) 1,180 229 286
Machinery
and
Equipment
8,199 294 (18) 8,312 6,255 617 (1,640) 5,232 3,080 1,944
Informatics
Hardware
35,005 2,047 500 37,552 34,134 3,197 (7,256) 30,075 7,477 871
Informatics
software
101 665 (646) 120 12 4 (12) 4 116 89
Other
Equipments
(non-Furn.)
329   (329) 0         0 329
Ships
and
Boats
165   (35) 130 55 6   61 69 110
Motor
Vehicles
4,484 470 (1,056) 3,898 3,709 532 (1,573) 2,668 1,230 775
Other
Vehicles
540 57 (257) 340 503 27 (319) 211 129 37
Leasehold
improvements
125 58 (125) 58         58 125
Assets
under
construction
835 8,091 (765) 8,161         8,161 835
Total 80,974 11,682 (3,027) 89,602 58,323 5,243 (12,954) 50,612 38,990 22,624

Amortization expense for the year ended March 31, 2007 is $5,243,000 (2005 - $4,956,000).

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Employee Benefits

a) Pension benefits: INAC's employees participate in the Public Service Pension Plan, which is sponsored and administered by the Government of Canada. Pension benefits accrued for 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 INAC contribute to the cost of the Plan. The expense amounts to $36,006,000 ($37,742,000 in 2006) which represents approximately 2.2 times (2.6 in 2006) the contributions by employees.

INAC'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: INAC provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information about the severance benefits, measured as at March 31, is as follows.

  2007 2006
Accrued benefit obligation, beginning of year 53,199 45,702
Expense for the year 8,380 12,825
Benefits paid during the year (5,230) (5,328)
Accrued benefit obligation, end of year 56,349 53,199

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Contingent liabilities

Contingent liabilities arise in the normal course of operations and their ultimate disposition is unknown. They are classified into three categories: claims and litigation, contaminated sites and loan guarantees.

a) Claims and Litigation

There are hundreds of claims and pending and threatened litigation cases outstanding against the department. These claims include items with pleading amounts and many where an amount is not specified. While the total amount claimed in these actions is significant, their outcomes are not determinable. There are three significant types of claims faced by INAC:

(i) Comprehensive land claims: These are claims that are based on traditional Native use and occupancy of land and represent settlements for modern treaties. The primary purpose of comprehensive claims settlement is to conclude agreements with Aboriginal groups that will resolve the legal ambiguities associated with the common law concept of Aboriginal rights. The process is intended to result in agreement on special rights Aboriginal peoples will have in the future with respect to lands and resources. There are 71 (74 in 2006) comprehensive land claims.

(ii) Specific Claims: These address past grievances arising out of non-fulfilment of Indian treaties and other lawful obligations, or the improper administration of lands and other assets under the Indian Act or formal agreements that are being pursued through negotiations. There are currently 744 (729 in 2006) specific claims under negotiation, accepted for negotiation or under review.

(iii) General Litigation claims: Comprehensive land claims and specific claims are pursued through the department while general litigation claims are claims that are being pursued through the legal system and where a formal statement of claim or application has been filed before the court and with the Department of Justice. There are currently 451 (439 in 2006) claims being pursued through the courts where the plaintiffs are seeking damages.

The department has recorded an allowance of $9,785,811,000 ($9,415,193,000 in 2006) as an estimate of the likely liability that will result from the above claims. This estimate includes projections based on historical rates and costs of settlements or similar claims.

b) Contaminated Sites

Liabilities are accrued to record the estimated costs related to the management and remediation of contaminated sites where the department is obligated to incur such costs. The department has identified contaminated sites for which a liability of $1,313,856,000 ($1,071,014,000 in 2006) has been recorded. Estimated additional clean-up costs of $519,205,000 ($627,880,000 in 2006) have not been accrued, as the likelihood of incurring these costs cannot be determined at this time. INAC's ongoing efforts to assess contaminated sites may result in additional environmental liabilities related to newly identified sites, or changes in the assessments or intended use of existing sites. These liabilities will be accrued by the department in the year in which they become known.

c) Loan Guarantees

The amount of the allowance for losses is determined by taking into consideration the weighed average of the contingent liability and the historical percentage of default. Losses on loan guarantees are recorded when it is likely that a payment will be made to honour a guarantee. As at March 31st, 2007, INAC has recorded an allowance for losses on loan guarantees of $1,800,000 ($1,800,000 in 2006).

As at March 31st, 2007, the department has the following balances available for new guarantees:

  2007 2006
Indian Economic Development Guarantee Program 60,000 31,578
On Reserve Housing Guarantee Program 1,700,000 181,432
Aboriginal Business Loan Insurance Program No Limit Not Applicable

(i) The Indian Economic Development Guarantee authority, established under Vote L53(b), Appropriation Act No. 1, 1970, amended under P.C. 1977-3608, authorized the department to guarantee loans for Indian business on a risk-sharing basis with commercial lenders. The guarantee level is not to exceed at any time $60,000,000, less the total amount of payments made to implement previous guarantees under that authority.

(ii) On Reserve Housing guarantees provide needed support to Indian or Indian bands residing on reserves or crown land. Reserves are, as such, non mortgageable and the ministerial guarantee provides security to the lending institution in the event of a default by the client.

In 1987, a reserve for losses of $2, 000,000 per annum was established within the department's reference levels to cover all Guarantee Loan Programs administered.

(iii) The Aboriginal Business Loan Insurance Program, established under the Department of Industry, Science and Technology Act, Section 9 and Paragraph 15 (1) (b), and Order in Council nos. P.C. 1990-370 and P.C. 1990-371, and amended under Department of Industry Act (1995), Part IV, Paragraph 14 (1) (b), provides loan insurance to financial institutions on behalf of loans issued to Aboriginal individuals, organizations, corporations or partnerships for the purpose of increasing commercial enterprise activity by Aboriginal Canadians. No limit was established regarding the maximum insured amount.

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Contractual Obligations

The nature of INAC's activities can result in some multi-year contracts and obligations whereby the department will be obligated to make future payments when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:

(in thousands of dollars) 2008 2009 20010 20011 2012 and thereafter Total
Transfer payments 1,256 744 644 213 15 2,872
Operating leases 29 15 - - - 44
Total 1,285 759 644 213 15 2,916

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Trust Accounts

Trust accounts represent the department's financial obligations in its role as administrator of certain monies that it has received or collected for specified purposes and that it will pay out accordingly. The following trust accounts are administered by the department.

(in thousands of dollars) 2008 2006
Trust Accounts Opening Balance Receipts Payments March 31, 2007 Balance March 31, 2006 Balance
Indian Band Funds 979,331 253,287 (290,578) 942,040 979,331
Indian Savings Accounts 36,195 7,218 (4,337) 39,076 36,195
Indian Estates Accounts 11,163 4,939 (3,494) 12,608 11,163
Total 1,026,689 265,444 (298,409) 993,724 1,026,689

Indian Band Funds:

This account was established to record monies belonging to Indian bands throughout Canada pursuant to sections 61 to 69 of the Indian Act.

Indian Savings Accounts:

These accounts were established to record monies received and disbursed for individual Indians pursuant to sections 52 and 52.1 to 52.5 of the Indian Act.

Indian Estate Accounts:

These accounts were established to record monies received and disbursed for estates of deceased Indians, mentally incompetent Indians and missing Indians pursuant to sections 42 to 51 and 52.3 of the Indian Act.

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Related party transactions

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

(a) Services provided without charge:

During the year, the department received without charge from other departments, accommodation, legal services and the employer's contribution to the health and dental insurance plans.

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

(in thousands of dollars) 2007 2006
Accommodation provided by Public Works and Government Services Canada (PWGSC) 26,789 25,577
Contributions covering employers' share of employees' insurance premiums and expenditures paid by TBS (excluding revolving funds) 24,219 23,068
Workman's compensation coverage provided by Human Resource Canada 637 605
Salary and associated expenditures for legal services provided by Justice Canada 20,736 19,589
Total 72,381 68,839

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

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

(in thousands of dollars) 2007 2006
Accounts payable to other government departments and agencies 25,776 15,313

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Comparative information

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

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Date modified: