To the Board of Directors of Canadian Patient Safety Institute
Opinion
The summary financial statements, which comprise the summary statement of financial position as at March 31, 2020, and the summary statement of operations for the year then ended, and related notes, are derived from the audited financial statements of Canadian Patient Safety Institute (the “Institute”) for the year ended March 31, 2020.
In our opinion, the accompanying summary financial statements are a fair summary of the audited financial statements, in accordance with the criteria disclosed in Note 2 to the summary financial statements.
Summary Financial Statements
The summary financial statements do not contain all the disclosures required by Canadian accounting standards for not-for-profit organizations. Reading the summary financial statements and the auditor's report thereon, therefore, is not a substitute for reading the Institute’s audited financial statements and the auditor's report thereon.
The summary financial statements and the audited financial statements do not reflect the effects of events that occurred subsequent to the date of our report on the audited financial statements.
The Audited Financial Statements and Our Report Thereon
We expressed an unmodified audit opinion on the audited financial statements in our report dated June 18, 2020.
Management’s Responsibility for the Summary Financial Statements
Management is responsible for the preparation of the summary financial statements in accordance with the criteria disclosed in Note 2 to the summary financial statements.
Auditor’s Responsibility
Our responsibility is to express an opinion on whether the summary financial statements are a fair summary of the audited financial statements based on our procedures, which were conducted in accordance with Canadian Auditing Standard (CAS) 810, Engagements to Report on Summary Financial Statements.
Chartered Professional Accountants
June 26, 2020
| 2020 | 2019 | |
|---|---|---|
| $ | $ | |
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | 1,463,592 | 1,977,992 |
| Accounts receivable | 179,058 | 239,358 |
| Prepaid expenses | 165,721 | 198,762 |
| 1,808,371 | 2,416,112 | |
| Capital assets | 99,394 | 202,499 |
| 1,907,765 | 2,618,611 | |
| Liabilities | ||
| Current liabilities | ||
| Accounts payable and accrued liabilities | 487,932 | 792,640 |
| Deferred government revenue (Note 4) | 254,821 | 531,494 |
| Deferred revenue | 178,571 | 208,559 |
| Deferred lease allowance | 16,824 | 84,121 |
| Deferred rent allowance | 2,218 | 11,090 |
| 940,366 | 1,627,904 | |
| Net Assets | ||
| Invested in capital assets | 82,570 | 118,378 |
| Unrestricted net assets | 429,582 | 417,082 |
| Internally restricted net assets | 455,247 | 455,247 |
| 967,399 | 990,707 | |
| 1,907,765 | 2,618,611 |
The accompanying notes are an integral part of the summary financial statements.
| 2020 | 2019 | |
|---|---|---|
| $ | $ | |
| Revenue | ||
| Contributions from Government of Canada (Note 4) | 7,876,673 | 7,647,778 |
| Registration, sponsorships and product sales | 422,398 | 423,147 |
| Other revenues | 47,766 | 55,996 |
| Gain on disposal of capital assets | - | 190 |
| 8,346,837 | 8,127,111 | |
| Program expenses | ||
| Safety Improvement Projects | 1,402,278 | 1,890,194 |
| Policy Impact | 486,204 | 271,568 |
| Making Patient Safety a Priority | 418,160 | 190,277 |
| Alliances and Networks | 253,657 | 283,071 |
| 2,560,299 | 2,635,110 | |
| Operations expenses | ||
| Salaries, wages and benefits | 4,209,993 | 3,927,357 |
| Other operating costs | 727,876 | 753,138 |
| Travel and meetings | 219,217 | 216,509 |
| Professional services | 215,865 | 121,005 |
| Corporate communications | 168,167 | 182,021 |
| Depreciation | 140,435 | 141,855 |
| Board of Directors | 128,293 | 155,521 |
| 5,809,846 | 5,497,406 | |
| Total expenses | 8,370,145 | 8,132,516 |
| Deficiency of revenue over expenses | (23,308) | (5,405) |
The accompanying notes are an integral part of the summary financial statements.
Purpose of organization
The Canadian Patient Safety Institute (the “Institute”) was incorporated under the Canada Corporations Act on December 5, 2003, and effective October 1, 2014, continued under the Canada Not-for-Profit Corporations Act. The purpose of the Institute is to address patient safety issues by strengthening system coordination, promoting best practices and providing advice to governments and stakeholders that places patient safety in the broader context of quality improvement in healthcare.
The Institute is exempt from income taxes under Section 149(1)(I) of the Income Tax Act.
Basis of presentation
The summary financial statements do not contain all the disclosures required by Canadian accounting standards for not-for-profit organizations. The statement of changes in net assets, the statement of cash flows and certain note disclosures have been omitted. Reading the summary financial statements, therefore, is not a substitute for reading the audited financial statements of the Institute.
The Institute is committed to full accountability and transparency in all we do. Our audited financial statements for the year ended March 31, 2020, including all disclosures required by Canadian accounting standards for not-for-profit organizations, can be found on the Institute’s website at www.patientsafetyinstitute.ca.
Future funding and continuation
During the year, the Boards of the Institute and of the Canadian Foundation for Healthcare Improvement (“CFHI”) have approved a letter of intent to pursue the formation of a combined organization dedicated to advancing safety and quality in the Canadian healthcare system. Over the coming months, the two organizations will seek the approval of their voting members to proceed with a plan to create the amalgamated organization. If approved, the intent of the Institute and CFHI is to have the amalgamated organization in place by April 2021, as well as a new contribution agreement with Health Canada that directs the existing funding of both organizations towards the new entity. As the operations of the Institute are planned to continue under the combined organization and the Institute has committed funding until March 31, 2021, note 4, the going concern basis continues to be appropriate.
Contributions from Government of Canada
Funding received for the 2019-20 fiscal year was the seventh year of funding under a contribution agreement with the Government of Canada. The contribution agreement initially provided for total contributions of up to $38,160,000 for the 2014-2018 fiscal years. In both the 2017-18 and 2018-19 fiscal years, the agreement was extended for one year, and in the 2019-20 fiscal year, it was extended again to provide an additional $7,600,000 for the 2020-21 fiscal year, to the end of March 2021. The Institute received payments of $7,600,000 (2019 - $7,600,000) from the Government of Canada during the year.
The contribution agreement specifies that the funding must be used for the eligible expenditures under the contribution agreement or returned to the Government of Canada. Eligible expenditures are determined on a capital expenditure basis. Where funds received in a given year are not fully expended on eligible expenditures, the agreement permits that up to 15% (2019 - 15%) of the current year’s funding can be carried forward to the following year, up until the final year of the contribution agreement. Of the $7,600,000 in funds received in the year plus the $531,494 carried forward from the prior 2018-19 year, the Institute recognized $7,876,673 as revenue, and is holding the remaining $254,821 as deferred revenue to be applied in the 2020-21 fiscal year. The Institute’s excess of revenue over eligible expenditures for Government of Canada purposes was $12,500 (2019 - $20,000), as reflected in the increase in net assets other than those invested in capital.
| 2020 | 2019 | |
|---|---|---|
| $ | $ | |
| Adjustment to capital expenditure basis: | ||
| Deficiency of revenue over expenses | (23,308) | (5,405) |
| Add back depreciation | 140,435 | 141,855 |
| Deduct capital expenditures | (37,330) | (49,153) |
| Reverse amortization of deferred lease allowance | (67,297) | (67,297) |
| Add proceeds on disposal of capital assets | - | 190 |
| Reverse gain on disposal of capital assets | - | (190) |
| Net result reported to Government of Canada | 12,500 | 20,000 |
The Institute’s ability to continue operations depends on the Government of Canada providing on-going contributions in accordance with the contribution agreement.
