Financial statements for the year ended March 31, 2025

Statement of management responsibility including internal control over financial reporting

Responsibility for the integrity and objectivity of the accompanying financial statements for the ear ended March 31, 2025 and all information contained in these statements rests with the management of the Transportation Safety Board of Canada (TSB). These financial statements have been prepared by management using the Government’s accounting policies which are based on Canadian public sector accounting standards.

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 fulfill its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the TSB's financial transactions. Financial information submitted in the preparation of the Public Accounts of Canada and included in the TSB's Departmental Results Report is consistent with these financial statements.

Management is also responsible for maintaining an effective system of internal control over financial reporting (ICFR) designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are properly authorized and recorded in accordance with the Financial Administration Act and other applicable legislation, regulations, authorities and policies.

Management seeks to ensure the objectivity and integrity of data in its financial statements through careful selection, training, and development of qualified staff; through organizational arrangements that provide appropriate divisions of responsibility; through communication programs aimed at ensuring that regulations, policies, standards, and managerial authorities are understood throughout the TSB and through conducting an annual risk-based assessment of the effectiveness of the system of ICFR.

The system of ICFR is designed to mitigate risks to a reasonable level based on an on-going process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments. A risk-based assessment of the system of ICFR for the year ended March 31, 2024 was completed in accordance with the Treasury Board Policy on Financial Management and the results and action plans are summarized in the annex. The TSB is currently working on the assessment for the year ended March 31, 2025.

The 2024–25 financial statements of the TSB have not been audited. 

Statement of financial position (unaudited) as at March 31 (in thousands of dollars)*

* See Note 8: Contractual obligations
* The accompanying notes form an integral part of these financial statements.

Statement of operations and departmental net financial position (unaudited) for the year ended March 31 (in thousands of dollars)*

* See Note 10: Segmented information
* The accompanying notes form an integral part of these financial statements.

Statement of change in departmental net debt (unaudited) for the year ended March 31 (in thousands of dollars)*

* The accompanying notes form an integral part of these financial statements.

Statement of cash flows (unaudited) for the year ended March 31 (in thousands of dollars)*

* The accompanying notes form an integral part of these financial statements.

Notes to the financial statements (unaudited) for the year ended March 31

Note 1: Authority and objectives

The Canadian Transportation Accident Investigation and Safety Board (CTAISB) was established in 1990 under the Canadian Transportation Accident Investigation and Safety Board Act and is a departmental corporation named in Schedule II to the Financial Administration Act. In its day-to-day activities the CTAISB is also known by the name Transportation Safety Board of Canada, or simply the TSB. The objective of the TSB is to advance transportation safety. It seeks to identify safety deficiencies in transportation occurrences and to make recommendations designed to eliminate or reduce any such safety deficiencies. In addition to investigations, including where necessary public inquiries into selected occurrences, the TSB may conduct studies into more general matters pertaining to transportation safety. The TSB has the exclusive authority to make findings as to causes and contributing factors when it investigates a transportation occurrence.

The TSB has the following four key programs to support the "independent safety investigations and communication of risks in the transportation system" core responsibility:

• Aviation Occurrence Investigations
• Marine Occurrence Investigations
• Pipeline Occurrence Investigations
• Rail Occurrence Investigations

Within each program, personnel conduct independent safety investigations into selected transportation occurrences. They identify causes and contributing factors, assess risks to the system, formulate recommendations to improve safety, publish investigation reports, communicate safety information to stakeholders, undertake outreach activities with key change agents, as well as assess and follow up on responses to recommendations. These activities are carried out by highly qualified investigators who are experts in the transportation operational sectors. They also work closely with personnel who are responsible for executing specialized work in the following fields: engineering and technical, macro-analysis, human performance and communications.

The Internal services program also contributes to the achievement of TSB’s strategic outcome. This program includes the functions and resources required to support the needs of the programs of the four transportation modes and to meet the department’s corporate obligations in areas such as human resources, finance, administration, , information management and information technology.

Note 2: Summary of significant accounting policies

These financial statements have been prepared using the TSB’s accounting policies stated below, which are based on Canadian public sector accounting standards. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian public sector accounting standards.

Significant accounting policies are as follows:

(a) Parliamentary authorities

The TSB is financed by the Government of Canada through Parliamentary authorities. Financial reporting of authorities provided to the TSB does not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Consequently, items recognized in the Statement of Financial Position and the Statement of Operations and Departmental Net Financial Position are not necessarily the same as those provided through authorities from Parliament. Note 3 provides a reconciliation between the two bases of reporting. The planned results amounts in the “Expenses” and “Revenues” sections of the Statement of Operations and Departmental Net Financial Position are the amounts reported in the Future-oriented Statement of Operations included in the 2024–25 Departmental Plan. Planned results are not presented in the “Government funding and transfers” section of the Statement of Operations and Departmental Net Financial Position and in the Statement of Change in Departmental Net Debt because these amounts were not included in the 2024-25 Departmental Plan.

(b) Net cash provided by Government

The TSB operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the TSB is deposited to the CRF and all cash disbursements made by the TSB 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 Government.

(c) Amounts due from the CRF

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 represents the net amount of cash that the TSB is entitled to draw from the CRF without further authorities to discharge its liabilities.

(d) Revenues

Revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenue takes place.

(e) Expenses

Expenses are recorded on an accrual basis:

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

(f) Employee future benefits

• Pension benefits: Eligible employees participate in the Public Service Pension Plan, a multi-employer pension plan administered by the Government. The TSB's contributions to the Plan are charged to expenses in the year incurred and represent the total TSB obligation to the Plan. The TSB’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.
• Severance benefits: The accumulation of severance benefits for voluntary departures ceased for applicable employee groups. The remaining obligation for employees who did not withdraw benefits is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole.

(g) Contingent liabilities

Contingent liabilities are potential liabilities which  may become actual liabilities when one or more future events occur or fail to occur. If the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made,  a provision is accrued, and an expense recorded to other expenses. 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) Inventory

Inventories consist of personal protective clothing, corporate communications clothing and supplies held for future program delivery and not intended for resale. Inventory is valued at cost using the average cost method. If there is no longer any service potential, inventory is valued at the lower of cost or net realizable value.

(i) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements and accompanying notes as at March 31. 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 the useful life of tangible capital assets and the liability for employee future 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.

(j) Related party transactions

Related party transactions, other than inter-entity transactions, are recorded at the exchange amount.

Inter-entity transactions are transactions between commonly controlled entities. Inter-entity transactions, other than restructuring transactions, are recorded on a gross basis and are measured at the carrying amount, except for the following:

1. Services provided on a recovery basis are recognized as revenues and expenses on a gross basis and measured at the exchange amount.
2. Certain services received on a without charge basis are recorded for departmental financial statement purposes at the carrying amount.

Note 3: Parliamentary authorities

The TSB receives most of its funding through annual parliamentary authorities. Items recognized in the Statement of Financial Position and the Statement of Operations and Departmental Net Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. Accordingly, the TSB 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)

(b) Authorities provided and used (in thousands of dollars)

Note 4: Accounts payable and accrued liabilities

Accounts payable and accrued liabilities (in thousands of dollars)

Note 5: Employee future benefits

(a) Pension benefits

The TSB's employees participate in the public service pension plan (the “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 Plan benefits and they are indexed to inflation.

Both the employees and the TSB contribute to the cost of the Plan. Due to the amendment of the Public Service Superannuation Act following the implementation of provisions related to Economic Action Plan 2012, employee contributors have been divided into two groups: Group 1 relates to existing plan members as of December 31, 2012, and Group 2 relates to members joining the Plan as of January 1, 2013. Each group has a distinct contribution rate.

The 2024-25 expense amounts to $2,749,948 ($2,477,127 in 2023-2024). For Group 1 members, the expense represents approximately 1.02 times (1.02 times in 2023–2024) the employee contributions and, for Group 2 members, approximately 1.00 times (1.00 times in 2023–2024) the employee contributions.

The TSB's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the Consolidated Financial Statements of the Government of Canada, as the Plan's sponsor.

(b) Severance benefits

Severance benefits provided to the TSB’s  employees were previously based on an employee’s eligibility, years of service and salary at termination of employment. However, since 2011 the accumulation of severance benefits for voluntary departures progressively ceased for substantially all employees. Employees subject to these changes were given the option to be paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits upon departure from the public service. By March 31, 2025 all settlements for immediate cash out were completed. Severance benefits are unfunded and, consequently, the outstanding obligation will be paid from future authorities.

Changes in obligations (in thousands of dollars)

Note 6: Accounts receivable and advances

Accounts receivable and advances (in thousands of dollars)

Note 7: Tangible capital assets

All tangible capital assets having an initial cost of $5,000 or more are recorded at their acquisition cost. In addition, acquisitions of all informatics hardware are recorded as tangible capital assets regardless of their acquisition cost.

Amortization of tangible capital assets is done on a straight-line basis over the estimated useful life of the asset as follows:

Assets under construction are recorded in the applicable capital asset class in the year that they become available for use and are not amortized until they become available for use.

Cost (in thousands of dollars)

Accumulated amortization (in thousands of dollars)

Note 8: Contractual obligations

The nature of the TSB's activities can result in some large multi-year contracts and obligations whereby the TSB 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:

Summary of significant contractual obligations (in thousands of dollars)

Note 9: Related party transactions

The TSB is related as a result of common ownership to all government departments, agencies and Crown corporations.

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

a) Common services provided without charge by other government departments

During the year, the TSB received services without charge from certain common service organizatioons, related to accommodation, workers' compensation, the employer's contribution to the health and dental insurance plans and worker’s compensation coverage. These services provided without charge have been recorded at the carrying value in the TSB's Statement of Operations and Departmental Net Financial Position as follows:

Common services provided without charge by other government departments (in thousands of dollars)

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 services organizations so that one department performs services for all other departments and agencies without charge. The costs of these services, such as the payroll and cheque issuance services provided by Public Services and Procurement Canada, are not included as an expense in the TSB's Statement of Operations and Departmental Net Financial Position.

(b) Other transactions with other government departments and agencies (in thousands of dollars)

Expenses and revenues disclosed in (b) exclude common services provided without charge, which are already disclosed in (a).

Note 10: Segmented information

Presentation by segment is based on the TSB's core responsibility. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in Note 2.

Expenses incurred and revenues generated for the core responsibility, by major object of expense and by major type of revenue (in thousands of dollars)

Annex to the Statement of Management Responsibility Including Internal Control over Financial Reporting of the TSB for Fiscal Year 2024- 2025

B.1 Introduction

In support of an effective system of internal control, the Transportation Safety Board of Canada (TSB) conducted self-assessments of key control areas that were identified to be assessed in the 2024 to 2025 fiscal year. A summary of the assessment results and action plan is provided in subsection B.2.

The TSB completed the assessment of key control areas as indicated in the following table. A summary of the results, action plans, and additional details are also provided.

B.2 Assessment results for the 2024 to 2025 fiscal year

The TSB completed the assessment of key control areas as indicated in the following table. A summary of the results, action plans, and additional details are also provided.

With respect to the key control areas of the Pay Administration, the controls were functioning well and provide an adequate basis for the department’s system of internal control. As such, no action plan was required.

In the case of Financial Management Governance, the TSB fully met all assessed criteria except the criterion for timely external financial reporting. It was found that certain external reporting deadlines during the period of assessment were late as a result of capacity constraints within a smaller organization. To improve compliance with external reporting requirements going forward, the TSB has implemented remedial measures including improved project coordination and stronger HR planning to mitigate vacancies.

B.3 Assessment plan

The TSB will assess the performance of its system of internal control by focusing on key control areas over a cycle of years as shown in the following table.

Assessment plan (subject to change, in accordance with TBS internal audit coverage of risks)