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Financial Statements For the Year Ended March 31, 2012 Table of Contents Statement of Management Responsibility ............................................................................................... 3 Independent Auditors’ Report to the Clerk of the House of Commons ................................................... 4 Statement of Financial Position ................................................................................................................ 6 Statement of Operations and Net Financial Position ................................................................................ 7 Statement of Change in Net Debt ............................................................................................................. 8 Statement of Cash Flow ............................................................................................................................ 9 Notes to the Financial Statements .......................................................................................................... 10 2 Statement of Management Responsibility Responsibility for the integrity and objectivity of the accompanying Financial Statements of the House of Commons for the year ended March 31, 2012, and of all information contained in these statements rests with management.
These Financial Statements have been prepared by management in accordance with Canadian generally accepted accounting principles for the public sector, using management’s best estimates and judgements where appropriate and giving due consideration to materiality.

Financial information submitted to the Public Accounts of Canada is consistent with these Financial Statements.
Management maintains a system of ﬁnancial management and internal control and management practices designed to provide reasonable assurance that the ﬁnancial information is reliable, that assets are safeguarded, that resources are managed economically and eﬃciently in the achievement of House of Commons objectives and that transactions reﬂect the By-laws approved by the Board of Internal Economy and statutory requirements.
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, guidelines, standards, and managerial authorities are understood throughout the House of Commons.
At the request of management, these Financial Statements have been audited by KPMG LLP, the independent auditors of the House of Commons.

On behalf of the House of Commons, on the 14th day of June 2012.
3 KPMG LLP Chartered Accountants Suite 2000 160 Elgin Street Ottawa, ON K2P 2P8 Canada Telephone (613) 212-KPMG (5764) Fax Internet (613) 212-2896 www.kpmg.ca INDEPENDENT AUDITORS' REPORT To the Clerk of the House of Commons We have audited the accompanying financial statements of House of Commons, which comprise the consolidated statement of financial position as at March 31, 2012, the statements of operations and net financial position, change in net debt and cash flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian public sector accounting standards, 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.
Auditors’ Responsibility Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Canadian generally accepted auditing standards.

Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.

The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
In making those risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
4 Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of the House of Commons as at March 31, 2012 and its results of operations, its changes in net debt and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.
Chartered Accountants, Licensed Public Accountants June 14, 2012 Ottawa, Canada 5 Statement of Financial Position As at March 31 (in thousands of dollars) Liabilities Accounts payable and accrued liabilities (note 4) Vacation pay and compensatory leave Lease obligations for tangible capital assets (note 5) Employee severance beneﬁts (note 6) Centennial Flame Research Award Fund (note 8) Total liabilities Financial assets Cash Due from the Consolidated Revenue Fund Accounts receivable (note 9) Advances (note 10) Inventory held for sale Total ﬁnancial assets 2012 19,773 6,327 3,302 52,277 19 81,698 364 14,358 6,636 713 214 22,285 2011 Restated (note 17) 13,228 6,985 4,082 48,566 17 72,878 185 11,132 3,296 352 205 15,170 Net debt 59,413 57,708 Non-ﬁnancial assets Prepaid expenses Inventories held for use Tangible capital assets (note 11) Total non-ﬁnancial assets Net ﬁnancial position Contractual obligations (note 12) Contingent liabilities (note 13) Approved by: 1,091 2,098 14,781 17,970 346 1,992 16,063 18,401 41,443 39,307 The accompanying notes form an integral part of these Financial Statements.
6 Statement of Operations and Net Financial Position For the year ended March 31 (in thousands of dollars) Expenses Operating Budget (note 14) 2012 2011 Reclassified (note 18) Salaries and employee benefits Accommodations Transportation and communications Professional and special services Utilities, materials and supplies Rentals Computer and office equipment, furniture and fixtures Repair and maintenance Information Amortization of tangible capital assets Net loss on disposal of tangible capital assets Other Total operating expenses 528,347 509,104 497,344 Transfer payments to international associations 940 886 884 Total expenses 529,287 509,990 498,228 Revenues Food Services – sales Other Total revenues 2,050 85 2,135 1,951 74 2,025 2,392 111 2,503 Net cost of operations 527,152 507,965 495,725 Government funding and transfers Net cash provided by Government of Canada Change in due from the Consolidated Revenue Fund Services received without charge (note 15) Transfer of tangible capital assets from other government departments (note 11) Net cost of operations after government funding and transfers (423,942) (3,226) (76,979) (428,336) 5,254 (69,758) (1,682) ‐ 2,136 2,885 Net financial position ‐ beginning of year 39,307 36,422 Net financial position ‐ end of year 41,443 39,307 The accompanying notes form an integral part of these Financial Statements.
7 Statement of Change in Net Debt For the year ended March 31 (in thousands of dollars) 2012 Net cost of operations after government funding and transfers 2,136 Change due to tangible capital assets Acquisition of tangible capital assets Amortization of tangible capital assets Net loss on disposal of tangible capital assets Proceeds from disposal of tangible capital assets Transfer of tangible capital assets from other government departments (note 11) Total change due to tangible capital assets Change due to inventories held for use Change due to prepaid expenses Net increase in net debt Net debt ‐ beginning of year Net debt ‐ end of year 3,422 (5,535) (829) (22) 1,682 (1,282) 106 745 1,705 57,708 59,413 2011 2,885 9,708 (4,049) (76) (29) ‐ 5,554 (459) 297 8,277 49,431 57,708 The accompanying notes form an integral part of these Financial Statements.
8 Statement of Cash Flow For the year ended March 31 (in thousands of dollars) Operating activities Net cost of operations Non‐cash items 2012 2011 Reclassified (note 18) 507,965 495,725 Services received without charge (note 15) Amortization of tangible capital assets Net loss on disposal of tangible capital assets (76,979) (5,535) (829) (69,758) (4,049) (76) Variations in Statement of Financial Position Increase (decrease) in cash Increase (decrease) in accounts receivable Increase (decrease) in advances Increase (decrease) in prepaid expenses Increase (decrease) in inventories Decrease (increase) in accounts payable and accrued liabilities Decrease (increase) in vacation pay and compensatory leave Decrease (increase) in employee severance benefits Decrease (increase) in Centennial Flame Research Award Fund 179 3,340 361 745 115 (6,545) 658 (3,711) (2) (650) 396 (6) 297 (439) 4,917 (214) (3,847) ‐ Cash used in operating activities 419,762 422,296 Capital investing activities Acquisitions of tangible capital assets Proceeds from disposal of tangible capital assets Cash used in capital investing activities Financing activities Increase of lease obligations for tangible capital assets Lease payments for tangible capital assets Cash used in financing activities 3,422 (22) 3,400 ‐ 780 780 9,708 (29) 9,679 (4,220) 581 (3,639) Net cash provided by Government of Canada 423,942 428,336 The accompanying notes form an integral part of these Financial Statements.
9 Notes to the Financial Statements For the year ended March 31 1.

Authority and objectives The House of Commons is a self‐governing institution established under the Constitution Act, 1867.

Through the Board of Internal Economy, it has the authority to act on all financial and administrative matters pursuant to the Parliament of Canada Act.
The Board of Internal Economy is the governing body of the House of Commons and oversees its financial management and administration on behalf of Members and Canadians.

It is chaired by the Speaker and comprised of Members representing all recognized parties.

The Clerk of the House of Commons is the Secretary to the Board of Internal Economy and, as the senior official of the House Administration, reports to the Speaker.
Members assume the roles of legislators and elected representatives of their constituencies.

In their constituencies, Members participate in events and activities and hold discussions with constituents about their concerns.

In the Chamber, Members participate in debates and study and vote on legislation.
Members sit on standing committees and special or joint committees, since the House of Commons delegates in‐depth consideration of bills and the thorough scrutiny of the Government’s programs and policies to its committees.

Members also participate in parliamentary associations and interparliamentary groups, and are members of delegations in parliamentary exchanges.
Finally, in caucus, Members develop strategy, discuss policy and examine important issues with fellow party members, and direct the work of party research offices.

Some Members, such as the Speaker, Deputy Speaker, House Leaders and Chief Whips, assume additional functions as House Officers.
The House Administration provides the support required by elected Members during a Parliament and, in addition, serves the House as an institution on a permanent basis by providing continuity from one Parliament to another, access to parliamentary records, and a stable infrastructure to support Members in the democratic process.
Advice and support are provided through a wide variety of services such as procedural, legislative, legal, information technology and management, building management, security, food, finance, human resources, health and safety.

The staff of the House of Commons strives to support the institution and Members in their roles as legislators and representatives of 308 constituencies in the Chamber, in committee and in caucus.
The House Administration comprises six Service Areas that employ the equivalent of 1,898 full‐time workers and report to the Clerk: Procedural Services; the Office of the Law Clerk and Parliamentary Counsel; Information Services; Parliamentary Precinct Services; Finance Services; and Human Resources, Corporate Planning and Communications Services.

10 Notes to the Financial Statements For the year ended March 31 2.
Summary of significant accounting policies (a) Basis of presentation These Financial Statements have been prepared in accordance with Canadian generally accepted accounting principles for the public sector.

(b) Parliamentary authorities The House of Commons is funded by the Government of Canada through parliamentary authorities.
Financial reporting of authorities provided to the House of Commons do not parallel financial reporting according to Canadian generally accepted accounting principles, since authorities are primarily based on cash flow requirements.

Consequently, items recognized in the Statement of Operations and Net Financial Position and in the Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament.
Note 3 provides a high‐level reconciliation between the bases of reporting.

(c) Net cash provided by Government of Canada The House of Commons operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada.

All cash received by the House of Commons is deposited to the CRF and all cash disbursements made by the House of Commons are paid from the CRF.
The net cash provided by Government of Canada is the difference between all cash receipts and all cash disbursements including transactions with departments of the Government of Canada.

(d) Due from the Consolidated Revenue Fund Amounts due from 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 House of Commons is entitled to draw from the CRF without further appropriations to discharge its liabilities.

(e) Accounts receivable and advances Accounts receivable and advances are stated as amounts expected to be ultimately realized; a provision is made for receivables where recovery is considered uncertain.
(f) Inventory held for sale Inventory held for sale consists of items in the canteens, cafeterias and the Parliamentary Dining Room.

This inventory is valued at the lower of cost or net realizable value using the first in, first out method.

11 Notes to the Financial Statements For the year ended March 31 2.
Summary of significant accounting policies (continued) (g) Inventories held for use Inventories held for use consist of consumable parts, material and office supplies held for future activities and having a value of $50,000 or more.

Inventories are valued at the lower of cost or net realizable value using the average cost method for office supplies, and using the first in, first out method for other items.
(h) Tangible capital assets All tangible capital assets having an initial cost of $10,000 or more are recorded at their acquisition cost.

Similar items under $10,000 are expensed in the Statement of Operations and Net Financial Position.

The House of Commons does not capitalize intangibles, works of art or historical treasures that have cultural, aesthetic or historical value.
Amounts included in assets under development are transferred to the appropriate class of asset upon completion and are then amortized.
Amortization of tangible capital assets is done on a straight‐line basis over the estimated useful life of the asset as follows: Asset Class Informatics hardware and infrastructure Software Machinery and equipment Vehicles Other equipment Leasehold improvements Leased equipment Amortization Period 3 years 3 to 10 years 7 to 10 years 5 to 7 years 5 to 10 years Lesser of 10 years or term of lease 5 to 10 years (i) Salaries and employee benefits and vacation leave Salaries, benefits, and vacation leave are expensed as they accrue to employees under their respective terms of employment.
The salaries and employee benefits liability is calculated based on the respective terms of employment using the employees’ salary levels at year end and the number of days remaining unpaid at the end of the year.

The liability for vacation leave is calculated at the salary levels in effect at March 31st for all unused vacation leave benefits accruing to employees.
Employee vacation pay liabilities payable upon cessation of employment represent House of Commons obligations that are normally funded through future years’ authorities.

12 Notes to the Financial Statements For the year ended March 31 2.

Summary of significant accounting policies (continued) (j) Employee severance benefits Employees entitled to severance benefits under labour contracts or conditions of employment earn these benefits as the services necessary to earn them are 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 of Canada as a whole.

Members who are not eligible for an immediate pension are entitled to a severance allowance under the Parliament of Canada Act upon ceasing to perform their parliamentary functions.

The severance allowance liability is reported in the Government of Canada financial statements.
(k) Pension benefits i.

Employee pension benefits Eligible employees participate in the Public Service Pension Plan under the Public Service Superannuation Act, which is sponsored and administered by the Government of Canada.

The House of Commons’ contributions to the Plan are charged to expenses in the year incurred and represent the total obligation of the House of Commons to the Plan.
The House of Commons is not required under current legislation to make contributions for any actuarial deficiencies of the Plan.

ii.

Members’ pension benefits Eligible Members participate in a defined benefit pension plan under the Members of Parliament Retiring Allowances Act, which is sponsored and administered by the Government of Canada.
Assets and liabilities for the Members’ pension accounts are not included in the House of Commons Statement of Financial Position, as these accounts are the responsibility of the Government of Canada.

The House of Commons’ contributions to these accounts are charged to the salaries and employee benefits expense in the year incurred.

(l) Contingent liabilities Contingent liabilities are potential liabilities that 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.

If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the Notes to the Financial Statements.

13 Notes to the Financial Statements For the year ended March 31 2.
Summary of significant accounting policies (continued) (m) Revenues Revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.

(n) Services received without charge Services received without charge from federal government departments for accommodation, employer contributions to the health and dental insurance plans, and workers’ compensation are recorded as operating expenses at their estimated cost.
(o) Transfer payments Transfer payments to international parliamentary and independent associations are recognized in the year in which the recipient has met the eligibility criteria or fulfilled the terms of a contractual transfer agreement.

(p) Foreign currency transactions Transactions involving foreign currencies are converted into Canadian dollar equivalents using rates of exchange in effect at the time of those transactions.
(q) Measurement uncertainty The preparation of these Financial Statements in accordance with Canadian generally accepted accounting principles for the public sector requires that management make estimates and assumptions that affect the 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 items where estimates are used are contingent liabilities, the liability for employee severance benefits and the useful life of tangible capital assets.

Actual results could significantly differ from those estimated.

Management’s estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the Financial Statements in the year they become known.

14 Notes to the Financial Statements For the year ended March 31 3.
Parliamentary authorities The House of Commons receives most of its funding through annual parliamentary authorities.

Items recognized in the Statement of Operations and Net Financial Position in one year may be funded through parliamentary authorities in prior, current or future years.

Accordingly, the House of Commons has different net results of operations for the year on a government funding basis than on an accrual accounting basis.
The differences are reconciled in the following tables: (a) Reconciliation of net cost of operations to current year authorities used (in thousands of dollars) Net cost of operations Adjustments for items affecting net cost of operations but not affecting authorities: Services received without charge (note 15) Inventory used Amortization of tangible capital assets Employee severance benefits Refund of previous years’ expenditures Net loss on disposal of tangible capital assets Vacation pay and compensatory leave Prepaid expenses consumption Other Adjustments for items not affecting net cost of operations but affecting authorities: Acquisitions of tangible capital assets Purchase of inventories Tangible capital asset lease principal payments Increase in prepaid expenses Advances issued 2012 2011 Reclassified (note 18) 507,965 495,725 (76,979) (4,316) (5,535) (3,711) 301 (829) 658 (346) 134 (90,623) 3,422 4,431 801 1,091 148 9,893 (69,758) (4,418) (4,049) (3,847) 652 (76) (214) (49) (96) (81,855) 5,488 3,979 581 346 ‐ 10,394 Current year authorities used 427,235 424,264 15 Notes to the Financial Statements For the year ended March 31 3.
Parliamentary authorities (continued) (b) Authorities provided and used (in thousands of dollars) 2012 2011 Vote 5 – Operating expenditures Statutory amounts Less: Lapsed ‐ Operating Current year authorities used 4.
Accounts payable and accrued liabilities (in thousands of dollars) Payables – External parties Payables – Federal government departments, agencies and Crown corporations Accrued liabilities Total accounts payable and accrued liabilities 294,170 152,252 446,422 (19,187) 427,235 290,992 149,786 440,778 (16,514) 424,264 2012 13,663 717 14,380 5,393 19,773 2011 Reclassified (note 18) 10,168 448 10,616 2,612 13,228 16 Notes to the Financial Statements For the year ended March 31 5.
Lease obligations for tangible capital assets The House of Commons has entered into agreements to lease equipment under capital leases with a cost of $5,129,647 and accumulated amortization of $1,914,464 as at March 31, 2012 ($5,303,076 and $1,215,253 respectively as at March 31, 2011).

The House of Commons has recorded a capital lease obligation of $3,302,226 as at March 31, 2012 ($4,082,072 as at March 31, 2011).
The obligations related to the upcoming years include the following: (in thousands of dollars) 2013 2014 2015 2016 2017 and thereafter Total future minimum lease payments Imputed interest (1.3% to 12.2%) Total obligations under leased tangible capital assets 6.

Employee severance benefits 2012 959 954 953 755 ‐ 3,621 (319) 3,302 The House of Commons 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 from future authorities.
Information about the severance benefits, measured as at March 31, is as follows: (in thousands of dollars) Employee severance benefit obligation ‐ beginning of year Expense for the year Benefits paid during the year Employee severance benefit obligation ‐ end of year 2012 48,566 19,053 (15,342) 52,277 2011 44,719 7,629 (3,782) 48,566 As part of changes to conditions of employment for executives, the accumulation of severance benefits under the employee severance pay program ceased for these employees commencing in 2012.
Employees subject to these changes have been given the option to be immediately paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits on termination of their employment.

These changes have been reflected in the calculation of the outstanding severance benefit obligation.

17 Notes to the Financial Statements For the year ended March 31 7.
Pension benefits (a) Employee pension benefits Employees of the House of Commons 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 the Canada and Quebec Pension Plans benefits and they are indexed to inflation.
Both the employees and the House of Commons contribute to the cost of the plan.

The 2011‐2012 expense amounts to $25,177,862 ($24,813,177 in 2010‐2011), which represents approximately 1.8 times (1.9 times in 2010‐2011) the employees’ contributions.

The House of Commons’ 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) Members’ pension benefits Members of Parliament participate in a pension plan consisting of two separate accounts, the Members of Parliament Retiring Allowances (MPRA) account and the Members of Parliament Retirement Compensation Arrangements (RCA), which are sponsored and administered by the Government of Canada.

Members of Parliament are eligible at age 55 to receive a basic retiring allowance upon termination of membership and after having contributed to the plan for at least six years.
The basic allowance is based on the best five years average sessional indemnity and accrues at a rate of three percent of those average indemnities.

Basic allowances are indexed to inflation once recipients reach age 60.

Both the Members of Parliament and the House of Commons contribute to the cost of the plan.

Contributions made by the House of Commons to these accounts totalled $25,520,459 in 2011‐2012 ($23,440,262 in 2010‐2011) and are recorded in salaries and employee benefits expense.
18 Notes to the Financial Statements For the year ended March 31 8.

Centennial Flame Research Award Fund The purpose of the Centennial Flame Research Award Fund is to provide awards of money to enable persons with disabilities to conduct research and prepare reports on the contributions of one or more persons with disabilities to the public life of Canada or the activities of Parliament.
Pursuant to section 3 of the Centennial Flame Research Award Act, the Centennial Flame Research Award Fund is credited with money collected from the Centennial Flame monument on Parliament Hill in Ottawa, as well as any money otherwise received as a donation.

9.

Accounts receivable (in thousands of dollars) Receivables – Federal government departments, agencies and Crown corporations Receivables – External parties Allowance for doubtful accounts on external receivables Total accounts receivable 10.
Advances (in thousands of dollars) Petty cash for Members of Parliament Travel and tuition advances Petty cash and floats for House of Commons employees Postage‐related advances Total advances 2012 2011 6,156 490 6,646 (10) 6,636 2012 295 360 39 19 713 2,872 434 3,306 (10) 3,296 2011 283 11 39 19 352 19 Notes to the Financial Statements For the year ended March 31 11.
Tangible capital assets (in thousands of dollars) Cost Accumulated Amortization Net Book Value Disposals Transfers of Disposals March 31, Acquisi‐ tions adjustments construction and assets under March 31, 2012 March 31, Amorti‐ and adjust‐ March 31, 2012 ments zation 2011 2012 2011 2011 Informatics hardware and infrastructure Software Machinery and equipment Vehicles Other equipment Leasehold improvements Assets under development 9,261 1,729 11,668 481 5,183 1,612 4,257 5,743 392 38 27 126 260 761 Subtotal 38,116 3,422 Leased equipment 5,303 ‐ Total 43,419 3,422 993 (182) (191) (51) (572) ‐ ‐ (3) (173) (176) ‐ 11,983 5,957 2,211 86 8,254 3,729 3,304 922 12,889 9,649 1,161 (163) 10,647 2,242 2,019 ‐ ‐ ‐ ‐ 5,030 1,588 3,811 6,003 (922) 231 ‐ ‐ ‐ 41,535 5,130 46,665 4,040 350 3,333 2,812 ‐ 294 241 201 554 ‐ (154) 4,180 850 1,143 (35) 556 1,032 1,262 (568) 2,966 845 924 ‐ ‐ 3,366 2,637 2,931 ‐ 231 392 26,141 4,662 (834) 29,969 11,566 11,975 1,215 873 (173) 1,915 3,215 4,088 27,356 5,535 (1,007) 31,884 14,781 16,063 Amortization expense for the year is $5,534,710 ($4,048,530 in 2010‐2011).
The House of Commons received informatics hardware and infrastructure with a net book value of $1,681,909 (cost of $3,760,104 and accumulated amortization of $2,078,195) from Public Works and Government Services Canada.

This transfer is shown in the disposals and adjustments columns.

20 Notes to the Financial Statements For the year ended March 31 12.
Contractual obligations The nature of the House of Commons' activities can result in some large multi‐year obligations whereby the House of Commons will be obligated to make future payments when the goods are received and services are rendered.
Significant contractual obligations that can be reasonably estimated are as follows: (in thousands of dollars) Equipment leases 2013 2014 2015 2016 2017 and thereafter Total 718 731 745 759 774 3,727 In the normal course of operations, the House of Commons assumes a contractual obligation through guarantees provided with respect to Members’ constituency office leases.

This guarantee covers up to 3 months of lease costs in the event a lease is terminated for various operational reasons.
Based on lease costs which can be incurred by the House as at March 31, 2012, the maximum obligation is estimated to be $2,225,958 ($2,124,749 as at March 31, 2011).

13.

Contingent liabilities As of March 31, 2012, management is not aware of any claims or possible claims against the House of Commons.

14.

Budget figures Budget figures have been provided for comparison purposes and are not audited.
Given the difference between parliamentary authorities and Canadian generally accepted accounting principles for the public sector, the budget figures presented have been adjusted to conform to the basis of accounting for these Financial Statements.

Note 3 provides a high‐level reconciliation between the bases of reporting.

21 Notes to the Financial Statements For the year ended March 31 15.
Related party transactions The House of Commons is related, as a result of common ownership, to all Government of Canada departments, agencies, and Crown corporations.

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

(a) Services received without charge During the year, the House of Commons received services that were obtained without charge from other departments and agencies.
These services received without charge have been recorded in the House of Commons’ Statement of Operations and Net Financial Position as follows: (in thousands of dollars) 2012 2011 Public Works and Government Services Canada – Accommodation Treasury Board Secretariat – Employer’s share of insurance premiums Human Resources and Skills Development Canada – Administrative charges related to Worker’s Compensation payments Total services received without charge 59,005 17,644 330 76,979 51,849 17,557 352 69,758 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 or agency performs services for all other departments and agencies without charge.

The cost of these services, such as payroll and cheque issuance services provided by Public Works and Government Services Canada, are not included as an expense in the House of Commons’ Statement of Operations and Net Financial Position.
(b) Other transactions with related parties Expenses shown below include services received without charge as described in section (a) of this note.

(in thousands of dollars) 2012 2011 Expenses – Other Government departments and agencies 137,409 128,185 22 Notes to the Financial Statements For the year ended March 31 16.

Expenses by function (in thousands of dollars) Members and House Officers House Administration Total expenses 17.
Restatement 2012 261,967 248,023 509,990 The Centennial Flame Research Award Fund was added to the 2011‐2012 Financial Statements.

In order to present comparative information, balances which existed as at March 31, 2011 were included in the Statement of Financial Position.

(in thousands of dollars) 2011 – end of year Restatement 2011 – end of year (restated) 18.
Comparative information Liabilities Financial assets 72,861 17 72,878 15,153 17 15,170 Comparative figures have been reclassified to conform to the current year's presentation.

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