Translation Bureau

Public Accounts of Canada 2023 Volume III—Top of the page Navigation

Statement of management responsibility

We have prepared the accompanying financial statements of the Translation Bureau Revolving Fund as required by the Treasury Board Directive on Charging and Special Financial Authorities in accordance with the Receiver General reporting requirements. These financial statements were prepared by the management of the Fund in accordance with the significant accounting policies set out in note 2 of the financial statements, on a basis consistent with that of the preceding year.

Responsibility for the integrity and objectivity of these financial statements rests with the management of the Fund. The information included in these financial statements is based on management's best estimates and judgment with due consideration given to materiality. To fulfill its accounting and reporting responsibilities, management maintains a set of accounts which provides a centralized record of the Fund's financial transactions. Financial information submitted to the Public Accounts of Canada and included in the Department's Departmental Results Report is consistent with these financial statements.

Management develops and disseminates financial management and accounting policies and issues specific directives which maintain standards of accounting and financial management. Management maintains systems of financial management and internal control which give due consideration to costs, benefits and risks. They are designed to provide reasonable assurance that transactions are properly authorized, are executed in accordance with prescribed regulations, and are properly recorded to maintain accountability of Government funds and safeguard the assets under the Fund's administration. Financial management and internal control systems are augmented by the maintenance of internal audit programs. Management also seeks to ensure the objectivity and integrity of data in its financial statements by the 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 its regulations, policies, standards and managerial authorities are understood throughout the organization.

Management has presented the financial statements to the independent external auditor, who audited them and has provided an independent opinion, which has been appended to these financial statements.

Approved by:

Wojo Zielonka, CPA
Assistant Deputy Minister and Chief Financial Officer
Public Services and Procurement Canada

Nathalie Laliberté
for Dominic Laporte
Chief Executive Officer,
Translation Bureau
Public Services and Procurement Canada

June 15, 2023
Gatineau, Canada

Table 1:Statement of authority provided (used) (unaudited) for the year ended March 31, 2023
(in thousands of dollars)
  2023 2022
EstimatesLink to table note 1 Actual EstimatesLink to table note 1 Actual
Net results (negative 4,430) (negative 1,368) (negative 1,472) (negative 10,745)
Items not requiring use of funds
Amortization 2,646 1,940 1,811 929
Operating source (use) of funds (negative 1,784) 572 339 (negative 9,816)
Items requiring use of funds
Net tangible capital assets acquisitions (negative 2,778) (negative 1,524) (negative 3,178) (negative 2,654)
Transfer of salary overpayments between government departments – 16 – (negative 70)
Net other assets and liabilities (negative 2,790) 3,028 (negative 528) 1,405
Authority provided (used) (negative 7,352) 2,092 (negative 3,367) (negative 11,135)

Table 2:Reconciliation of unused authority (unaudited) as at March 31, 2023
(in thousands of dollars)
  2023 2022
Credit balance in the accumulated net charge against the Fund's authority (negative 2,094) (negative 3,455)
Payables charged against the appropriation at year-end (negative 12,139) (negative 10,135)
Receivables credited to the appropriation at year-end 6,456 4,192
Other items 9,117 8,646
Net authority provided (used), end of year 1,340 (negative 752)
Authority limit (note 1) 30,000 30,000
Unused authority carried forward 31,340 29,248

Independent auditor's report

To the Deputy Minister, Public Services and Procurement Canada

Opinion

We have audited the financial statements of the Translation Bureau Revolving Fund (the Fund), which comprise the statement of financial position as at March 31, 2023, and the statement of operations and net liabilities and statement of cash flow for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements are prepared, in all material respects, in accordance with the financial reporting provisions of Section 1 of the Receiver General for Canada Instructions for Volume III of the Public Accounts of Canada.

Basis for opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Fund in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Emphasis of matter—basis of accounting and restriction on distribution and use

We draw attention to note 2 to the financial statements, which describes the basis of accounting. The financial statements are prepared to assist the Fund in complying with the financial reporting provisions of Section 1 of the Receiver General for Canada Instructions for Volume III of the Public Accounts of Canada. As a result, the financial statements may not be suitable for another purpose. Our report is intended solely for the Fund, the management of Public Services and Procurement Canada, the Treasury Board of Canada and the Receiver General for Canada and should not be used by parties other than the Fund, the management of Public Services and Procurement Canada, the Treasury Board of Canada and the Receiver General for Canada. Our opinion is not modified in respect of this matter.

Responsibilities of management and those charged with governance for the financial statements

Management is responsible for the preparation of these financial statements in accordance with the financial reporting provisions of Section 1 of the Receiver General for Canada Instructions for Volume III of the Public Accounts of Canada, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Fund's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Fund or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Fund's financial reporting process.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Ernst & Young LLP
Chartered Professional Accountants,
Licensed Public Accountants

June 15, 2023
Ottawa, Canada

Table 3:Statement of financial position as at March 31, 2023
(in thousands of dollars)
  2023 2022
Assets
Financial assets
Accounts receivable (note 3) 9,015 6,977
Other assets (note 4) 2,109 1,592
Total financial assets 11,124 8,569
Non-financial assets
Prepaid expenses 2 1
Tangible capital assets (note 5) 8,448 8,864
Total non-financial assets 8,450 8,865
Total assets 19,574 17,434
Liabilities
Accounts payable and accrued liabilities (note 6) 16,523 10,865
Vacation pay and compensatory leave 4,658 5,127
Employee severance benefits (note 7) 2,274 2,610
Total liabilities 23,455 18,602
Net liabilities (note 8) (negative 3,881) (negative 1,168)
Total 19,574 17,434

Table 4:Statement of operations and net liabilities for the year ended March 31, 2023
(in thousands of dollars)
  2023 2022
Revenues
Translation services 131,082 122,540
Interpretation services 21,213 19,339
Terminology services 14,220 13,758
Other 10,125 8,905
Total revenues 176,640 164,542
Operating expenses
Salaries and employee benefits 111,496 111,768
Professional and special services 37,416 35,043
Corporate and administrative services 20,272 21,902
Occupancy costs 3,809 4,505
Amortization (note 5) 1,940 929
Transportation and telecommunications 1,760 401
Other expenses 838 594
Utilities, materials and supplies 526 384
Employee severance benefits (note 7) (negative 49) (negative 239)
Total operating expenses 178,008 175,287
Net results (negative 1,368) (negative 10,745)
Net liabilities, beginning of year (negative 1,168) (negative 5,454)
Transfer of salary overpayments between government departments 16 (negative 70)
Net financial resources used (provided) and change in the accumulated net charge against the Fund's authority, during the year (note 8) (negative 1,361) 15,101
Net liabilities, end of year (note 8) (negative 3,881) (negative 1,168)

Table 5:Statement of cash flows for the year ended March 31, 2023
(in thousands of dollars)
  2023 2022
Operating activities
Net results (negative 1,368) (negative 10,745)
Items not requiring use of funds
Amortization of tangible capital assets (note 5) 1,940 929
Subtotal 572 (negative 9,816)
Variations in statement of financial position
Decrease (increase) in accounts receivable (negative 2,038) (negative 556)
Decrease (increase) in other assets (negative 517) (negative 239)
Decrease (increase) in prepaid expenses (negative 1) 1
Increase (decrease) in accounts payable and accrued liabilities 5,658 (negative 1,030)
Increase (decrease) in vacation pay and compensatory leave (negative 469) (negative 164)
Increase (decrease) in employee severance benefits (negative 336) (negative 573)
Total variations in statement of financial position 2,297 (negative 2,561)
Transfer of salary overpayments between government departments 16 (negative 70)
Net financial resources provided (used) by operating activities 2,885 (negative 12,447)
Capital investing activities
Acquisitions of tangible capital assets (note 5) (negative 1,524) (negative 2,654)
Net financial resources used by capital investing activities (negative 1,524) (negative 2,654)
Net financial resources provided (used) and change in the accumulated net charge against the Fund's authority, during the year (note 8) 1,361 (negative 15,101)
Accumulated net charge against the Fund's authority, beginning of year (negative 3,455) 11,646
Accumulated net charge against the Fund's authority, end of year (negative 2,094) (negative 3,455)

Notes to the financial statements for the year ended March 31, 2023

1. Authority and purpose

The Translation Bureau Revolving Fund (the Fund) is a Special Operating Agency that provides, on a cost recovery basis, translation, technolinguistic and other linguistic services to the judiciary and federal departments and agencies and, upon request, to other governments in Canada and international organizations. Although the Translation Bureau has existed since 1934, when the Translation Bureau Act came into effect, it was not until April 1993 that the Treasury Board approved the establishment of the Bureau as a Special Operating Agency, effective April 1, 1995. The Translation Bureau also became a revolving fund on April 1, 1995.

The Fund has a continuing non-lapsing authority from Parliament to make payments out of the Consolidated Revenue Fund for the purposes of working capital, capital acquisitions and the temporary financing of accumulated operating deficits, the total of which is not to exceed $30,000,000 at any time. Previously at $20,000,000, the authority limit was increased to $30,000,000 in 2021–2022 through the Appropriation Act No. 5, 2021–22.

2. Significant accounting policies

These financial statements have been prepared in accordance with the significant accounting policies set out below to comply with the reporting requirements for revolving funds described in Section 1 of the Receiver General for Canada instructions for Volume III of the Public Accounts of Canada. The basis of accounting used in these financial statements differs from Canadian public sector accounting standards mainly because:

The significant accounting policies are as follows:

(a) Revenue recognition

Revenues from translation services performed by the Fund for other government departments and agencies and external clients are recognized based on the percentage of completion of the project which is determined by the proportion of services provided at year end.

Revenues from the terminology standardization program, interpretation services, and other services are recognized as services are rendered.

(b) Accounts receivable

Accounts receivable are stated at amounts expected to be ultimately realized. An allowance is made for receivables where recovery is considered uncertain. Accounts receivable include the estimated amount of revenue earned for services rendered but not billed at year end.

(c) Expense recognition

All expenses are recorded on an accrual basis in the year they are incurred.

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

(d) Tangible capital assets

Tangible capital assets are amortized from the year of acquisition on a straight-line basis over their estimated useful life as follows:

Depreciation policy
Category Estimated useful life
Computer hardware 3 to 5 years
Computer software 3 to 5 years
Leasehold improvements Lesser of the remaining term of the occupancy instrument or useful life of the improvement
Assets under construction Once in service, in accordance with asset class

(e) Employee future benefits

Pension benefits

Eligible employees of the Fund participate in the Public Service Pension Plan (the Plan), a multiemployer pension plan administered by the Government of Canada. The Fund's contributions to the Plan are charged to expenses in the year which they are incurred and represent the total Fund obligation to the Plan. The Fund's responsibility with regard to the Plan is limited to the contributions paid. Actuarial surpluses or deficiencies are recognized in the financial statements of the Government of Canada, as the Plan's sponsor.

Severance benefits

Eligible employees of the Fund were entitled to severance benefits under labour contracts or conditions of employment. These benefits were earned as the services necessary to earn them were rendered. 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.

(f) Sick leave

Employees are permitted to accumulate unused sick leave. However, such leave entitlements may only be used in the event of an illness. As per current government practice, unused sick leave upon employee termination is not payable to the employee. Accordingly, no liability has been accrued in these financial statements. Payments of sick leave benefits are included in current operations as incurred.

(g) Contingent liabilities

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

(h) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses reported in the financial statements. At the time of preparation of these financial statements, management believes the estimates and assumptions to be reasonable. The most significant items where estimates are used are the allowance for doubtful accounts on receivables from outside parties, the estimated useful lives of tangible capital assets, the amount of certain liabilities, the liability for vacation pay and compensatory leave, and the liability for employee severance benefits. Actual results could significantly differ from those estimates. Management's estimates are reviewed periodically, and as adjustments become necessary, they are recorded in the financial statements in the year they become known.

3. Accounts receivable

Table 7:Accounts receivable
(in thousands of dollars)
  2023 2022
Other government departments and agencies 6,456 4,192
Outside parties 2,560 2,786
Total 9,016 6,978
Less: allowance for doubtful accounts on receivables from outside parties (negative 1) (negative 1)
Net accounts receivable 9,015 6,977

4. Other assets

Table 8:Other assets
(in thousands of dollars)
  2023 2022
Sales tax refundable advances 1,888 1,349
Other advances 221 243
Total other assets 2,109 1,592

5.Tangible capital assets

Table 9:Cost
(in thousands of dollars)
  Balance at beginning of year Acquisitions Disposals, write‑offs and transfers Balance at end of year
Computer hardware 245 552 – 797
Computer software 22,937 972 (negative 30) 23,879
Leasehold improvements 8,995 – (negative 2,855) 6,140
Assets under construction 1,280 – (negative 1,280) –
Total 33,457 1,524 (negative 4,165) 30,816

Table 10:Accumulated amortization
(in thousands of dollars)
  Balance at beginning of year Current year amortization Disposals, write‑offs and transfers Balance at end of year
Computer hardware (negative 179) (negative 95) – (negative 274)
Computer software (negative 19,328) (negative 1,080) 30 (negative 20,378)
Leasehold improvements (negative 5,086) (negative 765) 4,135 (negative 1,716)
Total (negative 24,593) (negative 1,940) 4,165 (negative 22,368)

Table 11:Net book value
(in thousands of dollars)
  2023 2022
Computer hardware 523 66
Computer software 3,501 3,609
Leasehold improvements 4,424 3,909
Assets under construction – 1,280
Total 8,448 8,864

6. Accounts payable and accrued liabilities

Table 12:Accounts payable and accrued liabilities
(in thousands of dollars)
  2023 2022
Outside parties 10,157 8,500
Other government departments and agencies 1,982 1,635
Total 12,139 10,135
Accrued liabilities 4,384 730
Total accounts payable and accrued liabilities 16,523 10,865

7. Employee severance benefits

The Fund provides severance benefits to its employees based on eligibility, years of service and salary at termination of employment. These severance benefits are not pre-funded. Benefits will be paid by future authorities.

Commencing in 2012, as part of collective agreement negotiations and changes to conditions of employment, the accumulation of severance benefits under the employee severance pay program ceased. The employees were given the option to be immediately paid the full or partial value of benefits earned to date or to collect the full or remaining value of benefits on termination from the public service. These changes have been reflected in the calculation of the outstanding severance benefits obligation.

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

Table 13:Employee severance benefits
(in thousands of dollars)
  2023 2022
Employee severance benefits obligation, beginning of year 2,610 3,183
Expense for the year (negative 49) (negative 239)
Benefits paid during the year (negative 287) (negative 334)
Employee severance benefits obligation, end of year 2,274 2,610

8. Net liabilities

The accumulated surplus is the accumulation of each fiscal year's surplus net of deficits since the inception of the Fund.

The accumulated net charge against the Fund's authority represents the cumulative receipts and disbursements over the life of the Fund.

Table 14:Net liabilities
(in thousands of dollars)
  2023 2022
Accumulated (deficit) surplus, beginning of year (negative 4,623) 6,192
Net results (negative 1,368) (negative 10,745)
Transfer of salary overpayments between government departments 16 (negative 70)
Accumulated (deficit) surplus, end of year (negative 5,975) (negative 4,623)
Accumulated net charge against the Fund's authority, beginning of year 3,455 (negative 11,646)
Net financial resources used (provided) and change in the accumulated net charge against the Fund's authority, during the year (negative 1,361) 15,101
Accumulated net charge against the Fund's authority, end of year 2,094 3,455
Net liabilities, end of year (negative 3,881) (negative 1,168)

9. Contractual obligations

The nature of the Fund's activities can result in some large multi-year contracts and obligations whereby the Fund will be obligated to make future payments when the goods and services are received. Estimated future payments are as follows:

Table 15:Contractual obligations
(in thousands of dollars)
   
Year ending March 31
2024 5,911
2025 2,137
2026 6,476
2027 1,637
2028 and thereafter 1,637
Total contractual obligations 17,798

10. Contingent liabilities

In connection with its operations, the Fund is involved in certain legal action. The amount of the litigation is not determinable. Settlement, if any, that may be made with respect to litigation is expected to be accounted for as a charge against income of the applicable years when future events are likely to occur and a reasonable estimate of the loss can be made.

11. Related party transactions

Through common ownership, the Fund is related to all Government of Canada departments, agencies, and Crown corporations. The Fund enters into transactions with these entities in the normal course of business and on normal trade terms.

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