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Section III Supplementary Information

Appendix A – HMIRC's Organization

The Council of Governors constitutes the key element of the Commission's governance structure, acts as an advisory body and provides strategic advice and guidance to the Commission. The Council consists of up to 18 members: 2 representing workers, 1 representing suppliers, 1 representing employers, 1 representing the federal government, and between 4 and 13 representing the provincial and territorial governments. Each governor is appointed by the Governor in Council for up to three years. The Council is headed by a chairperson chosen by the governors for a term of one year. The Council is responsible for making various recommendations to the Minister of Health, including changes to the regulations related to the Commission's fee structure, the procedures for reviewing claims for exemption, and the appeal procedures.

Most Council members concurrently represent other occupational health and safety organizations, and thus are part of the existing multi-jurisdictional occupational health and safety network.

The President and CEO is appointed by the Governor in Council and has the authority and responsibility to supervise and direct the organization's work on a day-to-day basis. The President is accountable to Parliament through the Minister of Health.

The Vice-President of Operations directs the work of the MSDS Compliance and the Screening divisions.

The Vice-President of Corporate Services and Adjudication directs the work of the Corporate Services, Regulatory Affairs and Appeals, and Communications divisions.

Appendix B – Financial Performance

Departmental Link to Government of Canada Outcome Area

Strategic Outcome:	Trade secret exemptions within WHMIS that balance the right of industry to withhold bona fide confidential business information with the right of employers and workers to be provided with complete and accurate information on the health and safety hazards posed by workplace chemicals.
	Actual Spending 2007-08			Alignment to Government of Canada Outcome Area
($ thousands)	Budgetary	Non-budgetary	Total
Claims Exemption Process	3,621	-	3,621	Healthy Canadians

The Commission's work supports:

• improved occupational health and safety for Canadian workers, a key element to achieving a healthy Canadian population; and
• competitive conditions in the marketplace to attract investment, encourage innovation, and protect the public interest, a key element to achieving Government of Canada's strategic outcome of a fair and secure marketplace.

Table 1: Comparison of planned to actual spending (including FTEs)

($ thousands)			2007–2008
	2005–06 Actual	2006–07 Actual	Main Estimates	Planned Spending	Total Authorities	Total Actuals
Claims Exemption Process	3,257	3,401	3,506	3,506	3,828	3,621
Total	3,257	3,401	3,506	3,506	3,828	3,621
Less: Non-Respendable Revenue	(1)570	591	-	570	-	(2)572
Plus: Cost of Services Received without Charge	894	754	-	723	-	745
Total Departmental Spending	3,581	3,564	-	3,659	-	745
Full-Time Equivalents	31	30	-	35	-	32

⁽¹⁾ 2005-06: The $570,000 actual revenues are comprised of $486,260 of fees collected plus $83,740 of Health Canada's frozen allotment.
⁽²⁾ 2007-08: The $572,000 actual revenues are comprised of $500,395 of fees collected plus $69,605 of Health Canada's frozen allotment and $2,000 from appeals.

Table 2:  Voted and statutory items ($ thousands)

Vote or Statutory Item	Truncated Vote or Statutory Wording	2007–2008
		Main Estimates	Planned Spending	Total Authorities	Total Actuals
25	Operating expenditures	3,024	3,024	3,438	3,231
(S)	Contributions to employee benefit plan	482	482	390	390
	Total	3,506	3,506	3,828	3,621

Table 3: Sources of Non-Respendable Revenue

For supplementary information on the Commission's sources of non-respendable revenue please visit: http://www.tbs-sct.gc.ca/dpr-rmr/st-ts-eng.asp

Table 4-A: User Fees Act

For supplementary information on the department's User Fees, please visit: http://www.tbs-sct.gc.ca/dpr-rmr/st-ts-eng.asp

Table 4-B: Policy on Service Standards for External Fees

For supplementary information on the department's Service Standards for External Fees, please visit: http://www.tbs-sct.gc.ca/dpr-rmr/st-ts-eng.asp

Appendix C – Financial Statements

Financial statements are prepared in accordance with accrual accounting principles. The unaudited supplementary information presented in the financial tables in the DPR is prepared on a modified cash basis of accounting in order to be consistent with appropriations-based reporting. Note 3 on page 39 reconciles these two accounting methods.

Statement of Management Responsibility

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 management. 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 judgement 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 the Commission's financial transactions. Financial information submitted to the Public Accounts of Canada and included in the Commission'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 the Commission.

The financial statements of the Commission have not been audited.

Sharon Watts
President and Chief Executive Officer
Ottawa, Canada
Date: August 7, 2008

Mary Hill
A/Vice-President, Corporate Services and Adjudicator
Ottawa, Canada
Date: August 7, 2008

 

Statement of Operations (unaudited)

For the year ended March 31 (in dollars)	2008	2007
Expenses
Salaries and employee benefits	2,946,016	3,080,696
Accommodation	563,056	556,982
Professional and special services	512,762	383,970
Utilities, material and supplies	196,666	101,907
Travel and relocation	42,784	43,607
Information	12,922	13,370
Communication	33,666	29,124
Rentals	15,956	12,018
Purchased repair and maintenance	5,512	7,137
Other	(916)	0
	4,328,424	4,228,811
Revenues
Client Services	502,040	591,445
Net cost of operations	3,826,384	3,637,366

 

Statement of Financial Position (unaudited)

At March 31 (in dollars)	2008	2007
Assets
Financial Assets
Accounts receivable and advances (Note 4)	117,160	126,606
	117,160	126,606
Liabilities and Equity of Canada
Liabilities
Accounts payable and accrued liabilities	602,127	323,418
Vacation pay and compensatory leave	168,847	141,267
Employee severance benefits (Note 5)	479,898	541,257
	1,250,872	1,005,942
Equity of Canada	(1,133,712)	(879,336)
	117,160	126,606

 

Statement of Equity (unaudited)

For the year ended March 31 (in dollars)	2008	2007
Equity of Canada, beginning of year	(879,336)	(630,811)
Net cost of operations	(3,826,384)	(3,637,366)
Current year appropriations used (Note 3)	3,620,795	3,400,784
Revenue not available for spending	(502,400)	(591,445)
Change in net position in the Consolidated Revenue Fund (Note 3)	(291,337)	(174,172)
Services received without charge by other government departments (Note 6)	744,950	753,674
Equity of Canada, end of year	(1,133,712)	(879,336)

 

Statement of Cash Flow (unaudited)

For the year ended March 31 (in dollars)	2008	2007
Operating activities
Net cost of operations	3,826,384	3,637,366
Non-cash items:
Services received without charge by other government departments (Note 6)	(744,950)	(753,674)
Variations in Statement of Financial Position:
Decrease in accounts receivable and advances	(9,446)	(32,986)
Increase in liabilities	(244,930)	(215,539)
Cash used for operating activities	2,827,058	2,635,167
Financing activities
Net cash provided by Government of Canada	(2,827,058)	(2,635,167)

 

Notes to the Financial Statements (unaudited)

1. Authority and purpose

The Hazardous Materials Information Review Commission was created as an independent quasi-judicial agency in 1987 by proclamation of the Hazardous Materials Information Review Act and is accountable to the Parliament of Canada through the Minister of Health. The Commission is charged with providing the trade secret protection mechanism within the Workplace Hazardous Materials Information System (WHMIS).

HMIS is a nation wide system which contributes to the reduction of illness and injury caused by using hazardous materials in the Canadian workplace. WHMIS requires that manufacturers and suppliers provide employers with information on the hazards of materials produced, sold, or used in Canadian workplaces. The employers, in turn, provide that information to employees through product labels, worker education programs and material safety data sheets (MSDSs).

The Commission's dual role is to balance the right of chemical companies to protect trade secrets and the need of workers to have accurate health and safety information about hazardous chemicals used in the workplace.

The Commission's mandate is to:

• formally register claims for trade secret exemptions and issue registry numbers;
• issue decisions on the validity of claims for exemption using prescribed regulatory criteria;
• make decisions on the compliance of MSDSs and labels within WHMIS requirements; and
• convene independent boards with representatives from labour, suppliers or employers to hear appeals from claimants or affected parties on decisions and orders issued by the Commission.

The Commission is responsible for the administration and enforcement of the following statutes and/or regulations, for which the Minister of Health is accountable to Parliament as the responsible Minister for the Commission: Hazardous Materials Information Review Act, Hazardous Materials Information Review Regulations, Hazardous Materials Information Review Act Appeal Board Procedures Regulations, Hazardous Products Act, Controlled Products Regulations, Canada Labour Code-Part II, Canada Occupational Safety and Health Regulations, provincial and territorial occupational safety and health acts and regulations, and Inquiries Act.

 

2. 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:

(a) Parliamentary appropriations
The Commission is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the Commission do not parallel financial reporting according to generally accepted accounting principles since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the statement of operations and the statement of financial position are not necessarily the same as those provided through appropriations from Parliament. Note 3 provides a high-level reconciliation between the bases of reporting.

(b) Net Cash Provided by Government
The Commission operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the Commission is deposited to the CRF and all cash disbursements made by the Commission are paid from the CRF. The net cash provided by Government is the difference between all cash receipts and all cash disbursements including transactions between departments of the federal government.

(c) Change in net position in the Consolidated Revenue Fund
The change in net position in the Consolidated Revenue Fund is the difference between the net cash provided by Government and appropriations used in a year, excluding the amount of non respendable revenue recorded by the Commission. It results from timing differences between when a transaction affects appropriations and when it is processed through the CRF.

(d) Revenues
HMIRC's revenues represent the fees for the claims of exemption from the requirement of manufacturers to disclose a product's hazardous materials. Revenues are accounted for and considered earned in the period in which the claim is registered and a registry number is issued.

(e) Expenses
Expenses are recorded on an accrual basis:

• Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
• Services provided without charge by other government departments for accommodation and the employer's contribution to the health and dental insurance plans are recorded as operating expenses at their estimated cost.

(f) Employee future benefits

1. Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multiemployer plan administered by the Government of Canada. The Commission's contributions to the Plan are charged to expenses in the year incurred and represent the total obligation to the Plan by the Commission. Current legislation does not require the Commission 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.

(g) Receivables
All receivables recorded by the Commission are from other government departments for which the recovery is considered certain. As a result, no provision has been made.

(h) Measurement uncertainty
The preparation of these financial statements in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. The most significant item where an estimate is used is the liability for employee severance benefits. Actual results could significantly differ from those estimated. Management's estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

 

3. Parliamentary Appropriations

The Commission 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, the Commission 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:

(in dollars)	2008	2007
Net cost of operations	3,826,384	3,637,366
Adjustments for items affecting net cost of operations but not affecting appropriations: Add (Less):
Services provided without charge from other government departments	(744,950)	(753,674)
Revenue not available for spending	502,400	591,445
Justice Canada legal fees	0	(27,356)
Severance pay benefits	61,359	(110,735)
Vacation pay and compensatory leave	(27,580)	25,054
Refund/adjustment of previous year's expenditures	3,182	38,684
Current year appropriations used	3,620,795	3,400,784

 

(b) Appropriations provided and used:

(in dollars)	2008	2007
Operating expenditures - Vote 25	3,438,155	3,224,850
Statutory Amounts	390,032	376,331
	3,828,187	3,601,181
Less: Lapsed Appropriations	(207,392)	(200,397)
Current year appropriations used	3,620,795	3,400,784

 

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

(in dollars)	2008	2007
Net cash provided by Government	2,827,058	2,635,167
Revenue not available for spending	502,400	591,445
	3,329,458	3,226,612
Change in net position in the Consolidated Revenue Fund
Justice Canada legal fees	0	(27,356)
Refund/adjustment of previous year's expenditures	3,182	38,684
Variation in accounts receivable	9,447	32,986
Variation in accounts payables	278,708	129,858
	291,337	174,172
Current year appropriations used	3,620,795	3,400,784

 

4. Accounts receivable and advances

(in dollars)	2008	2007
Receivables from other Federal Government departments and agencies	116,958	125,791
Receivables from external parties	2	615
Employee advances	200	200
Net accounts receivable and advances	117,160	126,606

 

5. Employee benefits

(a) Pension benefits

The Commission's employees participate in the Public Service Pension Plan, which is sponsored and administered by the Government of Canada. Pension benefits accrue up to a maximum period of 35 years at a rate of 2 percent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Québec Pension Plans benefits and they are indexed to inflation.

Both the employees and the Commission contribute to the cost of the Plan. The current and previous year expenses, which represent approximately 2.1 times (2.2 in 2006-07) the contributions by employees, amount to:

(in dollars)	2008	2007
Expense for the year	284,071	277,356

The Commission'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 Commission 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:

(in dollars)	2008	2007
Accrued benefit obligation, beginning of year	541,257	430,522
Expense for the year	18,333	170,142
Benefits paid during the year	(79,692)	(59,407)
Accrued benefit obligation, end of year	479,898	541,257

 

6. Related party transactions

The Commission is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. The Commission enters into transactions with these entities in the normal course of business and on normal trade terms. Also, during the year, the Commission 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 Commission received without charge from other departments, accommodation, legal fees 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 dollars)	2008	2007
Accommodation	563,056	556,982
Employer's contribution to the health and dental insurance plans	169,447	196,692
Legal services	12,447	0
Services provided without charges	744,950	753,674

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, are not included as an expense in the Commission's Statement of Operations.

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

(in dollars)	2008	2007
Accounts payable to other government departments and agencies	217,855	17,003

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