Financial statements, March 31, 2015

7. Notes to financial statments: Authority and purpose

The Canadian Grain Commission Revolving Fund ("CGC", "the Revolving Fund" or "the Fund") derives its authority from the Canada Grain Act. The Canadian Grain Commission's mandate as set out in the Act is to, in the interest of grain producers, establish and maintain standards of quality for Canadian grain, regulate grain handling in Canada and to ensure a dependable commodity for domestic and export markets.

In order to effectively pursue its mandate, the Canadian Grain Commission aims to achieve the following strategic outcome: Canada's grain is safe, reliable and marketable and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies.

The Canadian Grain Commission's Program Alignment Architecture has five programs. The Quality Assurance Program, Quantity Assurance Program, Grain Quality Research Program, and Producer Protection Program each contribute to making progress to the sole strategic outcome. The Internal Services program supports all other programs within the Canadian Grain Commission.

The Canadian Grain Commission Revolving Fund was established under Appropriation Act No. 6, 1994-1995. The Fund has a continuing non-lapsing authority from Parliament to make payments out of the Consolidated Revenue Fund for working capital, capital acquisitions and temporary financing of accumulated operating deficits, the total of which cannot exceed $2,000,000 at any time.

The Canadian Grain Commission received authorization from Treasury Board to access its net authority provided for a total amount up to $7,946,483 in fiscal year 2014-2015 to allow payments for severance obligations that have been expensed in previous years.

In the fall of 2012, two initiatives were announced that have impacted the services and organizational structure of the Canadian Grain Commission. Firstly, Bill C-45, containing proposed amendments to the Canada Grain Act, was introduced in Parliament. Secondly, on November 1, 2012, the Canadian Grain Commission launched consultations on Canadian Grain Commission user fees that reflected an updated Canada Grain Act and streamlined Canadian Grain Commission operations. Bill C-45 received Royal Assent on December 14, 2012. The amendments to the Canada Grain Act came into force on August 1, 2013. Updated user fees took effect August 1, 2013, concurrent with changes to the Canada Grain Act. In response to both the legislative changes and restructured user fees, the Canadian Grain Commission has adjusted its workforce (note 6), organizational design, and operations.

The revised funding model which came into effect on August 1, 2013, is based on full cost recovery through user fees and ongoing appropriations. Until the implementation of this model, the Canadian Grain Commission was funded through its ongoing appropriations, fees collected and special appropriation.

In accordance with the Government's policy on self-insurance, the Canadian Grain Commission does not carry its own insurance. The Canadian Grain Commission is not subject to income tax.