Exhibit 99.10

Public Accounts Ministry of Finance Office of the Comptroller General For the Fiscal Year Ended March 31, 2023

National Library of Canada Cataloguing in Publication Data

British Columbia. Office of the Comptroller General.

Public accounts for the year ended... – 2000/2001

Annual. 

Report year ends Mar. 31. 

Continues: British Columbia. Ministry of Finance.

Public accounts. ISSN 1187–8657. 

ISSN 1499–1659 = Public accounts–British Columbia. 

Office of the Comptroller General

1. British Columbia–Appropriations and expenditures–Periodicals. 2. Revenue–British Columbia–Periodicals. 

3. Finance, Public–British Columbia–Periodicals. 1. British Columbia. Ministry of Finance. 2. Title.

HJ13.B74         352.4’09711’05        C2001–960204–9

August 29, 2023

Victoria, British Columbia

Lieutenant Governor of the Province of British Columbia

MAY IT PLEASE YOUR HONOUR:

The undersigned has the honour to present the Public Accounts of the Government of the Province of British Columbia for the fiscal year ended March 31, 2023.

KATRINE CONROY

Minister of Finance

Ministry of Finance

Victoria, British Columbia

Honourable Katrine Conroy

Minister of Finance

I have the honour to submit herewith the Public Accounts of the Government of the Province of British Columbia for the fiscal year ended March 31, 2023.

Respectfully submitted,

CARL FISCHER

Comptroller General

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

British Columbia’s Public Accounts

The Public Accounts include the Summary Financial Statements of the provincial Government Reporting Entity which includes the financial results of all ministries and Crown agencies presented on a consolidated basis. The supporting notes and schedules define the accounting policies followed in preparing the province’s financial statements and form an integral part of the overall financial picture of the province’s financial activities in the fiscal year ending March 31, 2023.

Responsibility for the preparation of the government’s financial statements rests with the Office of the Comptroller General. The accounting standards followed by the province are established in section 23.1 of the Budget Transparency and Accountability Act. Although accounting policies are based on Public Sector Accounting Standards (PSAS), the application of standards to specific programs and transactions is the responsibility of the preparer who must use professional judgement to determine the treatment that is most representative of the underlying economic substance and best serves the information requirements of the users of government financial statements. To ensure due diligence in the application of accounting policies, decisions are based on comprehensive understanding of the substance of transactions, reference to existing and emerging accounting standards, and consultation with standard setters, other jurisdictions and the audit community.

In September 1999 the final report of the Budget Process Review Panel established clear principles for financial reporting based on user needs and led to the introduction of the Budget Transparency and Accountability Act which forms the basis of British Columbia’s legislated reporting framework. British Columbia is at the forefront of financial accountability by providing all financial reporting on a full accrual basis with direct comparability between budget and actual results. Conflicts can arise between the legislated requirement for comparable and consistent financial reporting and the national and international standards that guide accounting or the interpretation of those standards. Our obligation is to ensure financial reporting meets the accountability requirements of the public and stakeholders, within the framework established in legislation.

Despite the growing complexity of the reporting process, British Columbia remains committed to timely delivery of the Public Accounts each year and continues to focus on consistency in budgeting and financial reporting based on the comparability of its Estimates and Public Accounts, and the focus on “one bottom line”; that is, the Summary Financial Statements of the province.

In the 2022/23 fiscal year, government continued to provide emergency support in response to the COVID–19 pandemic, which included pandemic response and economic recovery spending of $2,392 million. As in previous years, additional financial information specific to the pandemic is included on page 12. We continue to maintain the highest standards of transparency and accountability to provide comprehensive accounting of this extraordinary event spanning several fiscal years.

I would like to thank the Select Standing Committee on Public Accounts of the Legislative Assembly, government ministries, Crown corporations and agencies, and the Auditor General and his staff for their cooperation and support in preparing the Public Accounts.

Comments or questions regarding the Public Accounts document are encouraged and much appreciated. Please direct your comments or questions to me by mail at PO Box 9413 STN PROV GOVT, Victoria BC V8W 9V1; e–mail at: Carl.Fischer@gov.bc.ca; by telephone at 250–387–6692; or by fax at 250–356–2001.

Further information on the government’s financial performance is also provided through the Consolidated Revenue Fund Extracts (available on the Internet – website http://gov.bc.ca/publicaccounts). These extracts compare actual to planned spending of ministries on an appropriation basis, fulfilling ministries accountability back to the Legislative Assembly.

CARL FISCHER

Comptroller General

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Contents

Overview (Unaudited) 

Public Accounts Content	9
legislative Compliance and Accounting Policy Report	10
Financial Statement Discussion and Analysis Report	11
Highlights	11
Discussion and Analysis	13
Economic Highlights	28
Summary Financial Statements
Statement of Responsibility for the Summary Financial Statements of the Government of the Province of British Columbia	33
Report of the Auditor General of British Columbia	35
Consolidated Statement of Financial Position	43
Consolidated Statement of Operations	44
Consolidated Statement of Change in Net liabilities	45
Consolidated Statement of Remeasurement Gains and losses	46
Consolidated Statement of Cash Flow	47
Notes to Consolidated Summary Financial Statements	49
Reporting Entity	93
Consolidated Statement of Financial Position by Sector	96
Consolidated Statement of Operations by Sector	100
Statement of Financial Position for Self–supported Crown Corporations and Agencies	104
Summary of Results of Operations and Statement of Equity for Self–supported Crown Corporations and Agencies	106
Consolidated Statement of Tangible Capital Assets	108
Consolidated Statement of Guaranteed Debt	109
Schedule of Investments	110
Supplementary Information (Unaudited)
Adjusted Net Income of Crown Corporations, Agencies and the SUCH Sector	113
SUCH Statement of Financial Position	116
SUCH Statement of Operations	118
Consolidated Staff Utilization	119
Consolidated Revenue Fund Extracts (Unaudited)
Statement of Financial Position	123
Statement of Operations	124
Statement of Remeasurement Gains and losses	125
General Fund Statement of Financial Position	126
General Fund Statement of Operations	127
BC Prosperity Fund Statement of Financial Position	128
BC Prosperity Fund Statement of Operations	128
Statement of Cash Flow	129
Schedule of Net Revenue by Source	131
Schedule of Comparison of Estimated Expenses to Actual Expenses	133
Schedule of Financing Transaction Disbursements	135
Schedule of Write–offs, Extinguishments and Remissions	136

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Contents

Provincial Debt Summary
Overview of Provincial Debt (Unaudited)	139
Provincial Debt (Unaudited)	140
Change in Provincial Debt (Unaudited)	141
Reconciliation of Summary Financial Statements’ Deficit (Surplus) to Change in Taxpayer–supported Debt and Total Debt (Unaudited)	142
Reconciliation of Total Debt to Summary Financial Statements’ Debt (Unaudited)	142
Change in Provincial Debt, Comparison to Budget (Unaudited)	143
Interprovincial Comparison of Taxpayer–supported Debt as a Percentage of Gross Domestic Product (Unaudited)	144
Interprovincial Comparison of Taxpayer–supported Debt Service Costs as a Percentage of Revenue (Unaudited)	145
Report of the Auditor General of British Columbia on the Summary of Provincial Debt, Key Indicators of Provincial Debt, and Summary of Performance Measures	147
Summary of Provincial Debt	149
Key Indicators of Provincial Debt	151
Summary of Performance Measures	152
Definitions (Unaudited)	153
Acronyms (Unaudited)	156

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PUBLIC ACCOUNTS 2022/23

Public Accounts Content

Financial Statement Discussion and Analysis (Unaudited)—this section provides a written commentary on the Summary Financial Statements plus additional information on the financial performance of the provincial government.

Consolidated Summary Financial Statements—these audited statements have been prepared to disclose the financial impact of the government’s activities. They aggregate the Consolidated Revenue Fund (CRF), the taxpayer–supported Crown corporations and agencies (government organizations), the self–supported Crown corporations and agencies (government business enterprises) and the school districts, universities, colleges, institutes and health organizations (SUCH) sector.

Supplementary Information (Unaudited)—this section provides supplementary schedules containing detailed information on the results of those Crown corporations and agencies that are part of the government reporting entity and the impact of the SUCH sector on the province’s financial statements.

Consolidated Revenue Fund Extracts (Unaudited)— the CRF reflects the core operations of the province as represented by the operations of government ministries and legislative offices. Its statements are included in an abridged form. The CRF Extracts include statements and schedules of the financial activities of the CRF, as required by statute.

Provincial Debt Summary—this section presents unaudited schedules and unaudited statements that provide further details on provincial debt and reconcile the Summary Financial Statements debt to the province’s total debt. Also included are the audited Summary of Provincial Debt, Key Indicators of Provincial Debt and Summary of Performance Measures.

This publication is available on the Internet at: http://gov.bc.ca/finance

Additional Information Available (Unaudited)

Consolidated Revenue Fund Supplementary Schedules —this section contains schedules that provide details of financial activities of the CRF, including details of expenses by ministerial appropriations, an analysis of statutory appropriations, Special Accounts and Special Fund balances and operating statements, and financing transactions.

Consolidated Revenue Fund Detailed Schedules of Payments—this section contains detailed schedules of salaries, wages, travel expenses, grants and other payments.

Financial Statements of Government Organizations and Enterprises—this section contains links to the audited financial statements of those Crown corporations, agencies and SUCH sector entities that are included in the government reporting entity.

This additional information is available only on the Internet at: http://gov.bc.ca/finance

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	PUBLIC ACCOUNTS 2022/23

Legislative Compliance and Accounting Policy Report

The focus of the province’s financial reporting is the Summary Financial Statements, which consolidate the operating and financial results of the province’s Crown corporations, agencies, school districts, universities, colleges, institutes and health organizations with the Consolidated Revenue Fund. These are general–purpose statements designed to meet, to the extent possible, the information needs of a variety of users.

The Public Accounts are prepared in accordance with the Financial Administration Act and the Budget Transparency and Accountability Act (BTAA).

The BTAA was amended in 2001 with the passing of Bill 5. Under section 20 of that Bill, the government has mandated that “all accounting policies and practices applicable to documents required to be made public under this Act for the government reporting entity must conform to generally accepted accounting principles.”

For senior governments, generally accepted accounting principles (GAAP) is generally considered to be the recommendations and guidelines of the Canadian Public Sector Accounting Board.

Section 4.1 of the BTAA established an Accounting Policy Advisory Committee (APAC) to advise Treasury Board on the implementation of GAAP for the government reporting entity (GRE). With the government’s transition to full GAAP for the 2004/05 year, the role of APAC changed to include the provision of advice on evolving developments in accounting standards by the accounting profession, as well as emerging issues within government.

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PUBLIC ACCOUNTS 2022/23

Financial Statement Discussion and Analysis Report

Highlights

The highlights section provides a summary of the key events affecting the financial statements based on information taken from the Summary Financial Statements and Provincial Debt Summary included in the Public Accounts. The budget figures are from pages 171, 177, 178, 180 and 181 of the Budget and Fiscal Plan 2022/23–2024/25.

Budget and Actual Results 2022/23

	In Millions						Variance
	2022/23  Budget		2022/23  Updated  Forecast		2022/23  Actual		2021/22  Actual		2022/23  Actual to  Budget		2022/23  vs  2021/22
	$		$		$		$		$		$
Revenue	68,552		82,700		81,536		72,392		12,984		9,144
Expense	(73,013	)	(79,108	)	(80,832	)	(71,127	)	(7,819	)	(9,705	)
Surplus (deficit) before forecast allowance	(4,461	)	3,592		704		1,265		5,165		(561	)
Forecast allowance	(1,000	)							1,000
Surplus (deficit) for the year	(5,461	)	3,592		704		1,265		6,165		(561	)
Capital spending:
Taxpayer–supported capital spending	9,279		8,117		6,755		6,020		(2,524	)	735
Self–supported capital spending	4,374		4,055		4,165		3,652		(209	)	513
Total capital spending	13,653		12,172		10,920		9,672		(2,733	)	1,248
Provincial debt:
Taxpayer–supported	73,475		63,701		59,934		62,341		(13,541	)	(2,407	)
Self–supported	30,956		29,788		29,492		28,325		(1,464	)	1,167
Forecast allowance	1,000								(1,000	)
Total provincial debt	105,431		93,489		89,426		90,666		(16,005	)	(1,240	)
Taxpayer–supported debt to GDP ratio	20.0	%	16.4	%	15.4	%	17.9	%	(4.6	)	(2.5	)

Summary Accounts Surplus (Deficit)

The province ended the year with a surplus of $704 million, which was an improvement of $6,165 million over the deficit forecast in the Budget and Fiscal Plan 2022/23–2024/25. The 2022/23 surplus of $704 million was $561 million less than the surplus of $1,265 million in fiscal year 2021/22. 

Revenue increased by $9,144 million over fiscal year 2021/22 and was $12,984 million higher than budget. The annual increase in revenue in the current year was mainly due to increases in taxation revenue, natural resources, and contributions from the federal government. 

Expense increased by $9,705 million over fiscal year 2021/22 and was higher than budget by $7,819 million. The increases in spending in the current year were mainly in the health, natural resources and economic development, social services, general government, and other sectors. Additional spending over budget was authorized through supplementary estimates and various statutory appropriations.

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Financial Statement Discussion and Analysis Report

Capital Spending

Taxpayer–supported infrastructure spending on hospitals, schools, post–secondary facilities, transit, and roads totalled $6,755 million in 2022/23, $2,524 million lower than budget mainly due to project scheduling changes. This spending has been deferred to future years. 

Self–supported infrastructure spending on electrical generation, transmission and distribution projects and other capital assets totalled $4,165 million in 2022/23. Self–supported capital spending was $209 million lower than budget.

Provincial Debt 

When calculating total provincial debt, the province adds to its financial statement debt all debt guarantees and the debt directly incurred by self–supported Crown corporations, reduced by sinking fund assets and unrealized foreign exchange adjustments of hedged foreign denominated debt translated to March 31, 2023 exchange rates. This balance is referred to as the total provincial debt. 

Taxpayer–supported provincial debt decreased by $2,407 million in 2022/23 due to improved operating results over the fiscal year resulting in decreased borrowing. Self–supported provincial debt increased by $1,167 million due to an increase in capital infrastructure related to power projects. Total provincial debt decreased by $1,240 million compared to the budgeted increase of $14,765 million. The key measure of taxpayer–supported debt to GDP ended the year at 15.4%, which is lower than the forecasted 20.0% in the budget.

COVID–19 Pandemic Spending and Related Measures 

This section provides an overview of spending through the Province’s pandemic response and economic recovery initiatives during the current year. This spending was authorized by voted appropriations.

	In Millions
	Vote 47  Pandemic and  Recovery		Ministry Votes		Total Spend
	$		$		$
Health Related COVID–19 Management		780		778		1,558
Supports for Vulnerable Populations		135		22		157
Tourism Initiative Envelope		94		1		95
Other Recovery Initiatives		481		101		582
Total Pandemic Response and Recovery Initiatives Spending		1,490		902		2,392

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Financial Statement Discussion and Analysis Report

Discussion and Analysis

The detailed analysis section provides an overview of significant trends relating to the Statement of Operations, Statement of Financial Position and Provincial Debt.

Revenue Analysis

Revenue analysis helps users understand the government’s finances in terms of its revenue sources and allows them to evaluate the revenue producing capacity of the government.

Revenue by Source

Revenue by source provides an outline of the primary sources of provincial revenue and how results change between those sources over time. Revenues are reported by separate components of taxation, contributions from the federal government, natural resources and other sources, which include fees and licences, contributions from self–supported Crown corporations, and investment income.

	In Millions
	2018/19  Actual		2019/20  Actual		2020/21  Actual		2021/22  Actual		2022/23 Actual
		$		$		$		$		$
Taxation		32,715		33,266		34,166		40,717		49,025
Contributions from federal government		9,052		9,535		12,894		11,980		12,526
Fees and licences		5,592		5,572		4,329		4,584		4,928
Miscellaneous		3,413		3,837		3,136		3,910		4,445
Net earnings of self–supported Crown corporations and agencies		2,005		2,919		3,964		5,424		3,098
Natural resources		3,108		2,268		2,403		4,471		6,198
Investment income		1,243		1,263		1,264		1,306		1,316
Total revenue		57,128		58,660		62,156		72,392		81,536

Provincial revenues increased by $9,144 million in 2022/23. The improvement in provincial revenue was primarily due to increases in taxation revenue of $8,308 million, natural resources revenue of $1,727 million, contributions from the federal government of $546 million, and other revenue of $889 million. Increases in these significant sources of revenue were offset by a decrease in net earnings from self–supported Crown corporations of $2,326 million.

2018/19 to 2022/23

 

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	PUBLIC ACCOUNTS 2022/23

Financial Statement Discussion and Analysis Report

In 2022/23, taxation revenue increased by $8,308 million (20.4%). Personal and corporate income tax revenue increased by $7,667 million (40.9%), reflecting a stronger income and tax base. Provincial sales tax revenue increased $1,087 million (12.5%). Other taxation revenues increased by $588 million, mainly from increases in property tax, employer health tax and carbon tax. Property transfer tax revenue decreased by $1,034 million (31.1%) due to a lower number of houses sold. 

The net earnings of self–supported Crown corporations and agencies were $2,326 million lower than 2021/22 mainly from decreased earnings of $2,413 million in ICBC. 

Natural resource revenues were $1,727 million higher than 2021/22, reflecting higher natural gas, coal, petroleum and electricity prices.

Own–source Revenue to GDP

The ratio of own–source revenue to GDP represents the amount of revenue the provincial government is taking from the provincial economy in the form of taxation, natural resource revenue, earnings of self–supported Crown corporations and user fees and licences (own–source revenue is all revenue except for federal transfers). 

Own–source revenue to GDP has remained stable over the past five years, ending the year at 17.7%.

2018/19 to 2022/23

 

Percentage Change in Revenue

Trend analysis of revenue provides users with information about significant changes in revenue over time and between sources. This enables users to evaluate past performance and assess potential implications for the future. 

Over the five years since 2018/19, total revenue has increased in relation with the increase in GDP. Taxation revenue has continued to exceed the growth in GDP, and natural resource revenue has increased over prior years. Contributions from the federal government increased in the year due to extreme weather event support funding.

2018/19 to 2022/23

 

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PUBLIC ACCOUNTS 2022/23

Financial Statement Discussion and Analysis Report

Natural Resource Revenue

The chart of natural resource revenue by source explains past trends of natural resource revenue in total and by major category. 

Petroleum, natural gas and mineral revenues increased by $1,508 million from 2021/22. These categories of natural resource revenue account for 54.1% of natural resource revenue compared to 41.3% in 2021/22.

Water and other resource revenues increased by $225 million in the year. They comprise 15.4% of provincial natural resource revenue. 

Forestry revenue decreased by $6 million in 2022/23. The proportion of natural resource revenue derived from forestry decreased to 30.4% in 2022/23 from 42.3% in 2021/22.

2018/19 to 2022/23

 

Government–to–Government Transfers to Total Revenue

The ratio of government–to–government transfers to total revenue is an indicator of how dependent the province is on transfers from the federal government. An increasing trend shows more reliance and a decreasing trend shows less reliance. 

Federal transfers increased in 2022/23 by $546 million. The ratio of federal contributions to total revenue decreased to 15.4% due to total revenue increasing $9,144 million over the prior year.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Expense Analysis 

The following analysis helps users to understand the impact of the government’s spending on the economy, the government’s allocation and use of resources, and the cost of government programs.

Expense by Function 

Expense by function provides a summary of the major areas of government spending, and changes in spending over time. Functions, which indicate the purpose of expenditures, are defined by Statistics Canada’s Financial Management System of Government Statistics. The province uses the following functions: health, education, social services, natural resources and economic development, interest, other, transportation, general government, and protection of persons and property. The health, education and social services functions account for approximately three quarters of the province’s total operating costs.

	In Millions
	2018/19 Actual		2019/20 Actual		2020/21 Actual		2021/22 Actual		2022/23 Actual
		$		$		$		$		$
Health		22,159		23,456		25,613		27,591		30,322
Education		14,094		14,740		14,948		15,801		16,991
Social services		5,343		5,887		7,789		7,268		9,652
Other		1,831		2,524		2,862		3,082		5,736
Natural resources and economic development		3,825		3,779		4,191		5,213		6,284
Interest		2,684		2,727		2,722		2,742		2,719
Protection of persons and property		2,004		2,126		2,258		2,937		3,483
Transportation		2,021		2,126		3,362		4,453		3,319
General government		1,673		1,657		3,919		2,040		2,326
Total expense		55,634		59,022		67,664		71,127		80,832

Government spending on programs and services increased by $9,705 million in 2022/23. 

The province increased spending on the health sector by $2,731 million (9.9%), the other sector by $2,654 million (86.1%), the social services sector by $2,384 million (32.8%), the education sector by $1,190 million (7.5%), the natural resources sector by $1,071 million (20.5%), the protection sector by $546 million (18.6%), and the general government sector by $286 million (14.0%). Spending in the transportation sector decreased by $1,134 million (25.5%) over 2021/22. Expenses of the year included $2,392 million in pandemic response and recovery program costs as detailed on page 12.

2018/19 to 2022/23

 

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PUBLIC ACCOUNTS 2022/23

Financial Statement Discussion and Analysis Report

In 2022/23, provincial operating expenses were $80,832 million, a $9,705 million (13.6%) increase from 2021/22. Program spending has increased by $25,198 million (45.3%) since 2018/19. This is compared to increases in GDP of 31.8% over the same period.

Expense to GDP

The ratio of expense to GDP represents the amount of government spending in relation to the overall provincial economy. 

Government spending as a percentage of GDP increased from 20.5% to 20.8% in 2022/23, reflecting increased spending in 2022/23 on key priority initiatives.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Changes in Actual Results from 2021/22 to 2022/23

	In Millions
	Revenue			Expense			Surplus
		$			$			$
2021/22 Surplus		72,392			71,127			1,265
Increase in taxation revenue		8,308						8,308
Increase in natural resources revenue		1,727						1,727
Increase in other revenues		889						889
Increase in contributions from the federal government		546						546
Decrease in net earnings of self–supported Crown corporations and agencies		(2,326	)					(2,326	)
Increase in other program spending					3,177			(3,177	)
Increase in health spending					2,731			(2,731	)
Increase in social services spending					2,384			(2,384	)
Increase in education spending					1,190			(1,190	)
Increase in natural resource spending					1,071			(1,071	)
Increase in general government spending					286			(286	)
Decrease in transportation spending					(1,134	)		1,134
Subtotal of changes in actual results		9,144			9,705			(561	)
		81,536			80,832
2022/23 Surplus								704
2021/22 Accumulated Surplus before Remeasurement Gains and Losses								2,201
2022/23 Accumulated Surplus before Remeasurement Gains and Losses								2,905
Effect of remeasurement gains and (losses)								(202	)
2022/23 Accumulated Surplus								2,703

The year over year increase in total revenue of $9,144 million, offset by the increase in total expense of $9,705 million, resulted in a surplus that was $561 million lower than the 2021/22 surplus. Accumulated surplus, including remeasurement gains and losses, increased from $2,607 million in 2021/22 to $2,703 million at the end of 2022/23.

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Financial Statement Discussion and Analysis Report

Changes from 2022/23 Budget

	In Millions
	Revenue			Expense			Forecast  Allowance			Surplus  (Deficit)
	$			$			$			$
(Deficit) per 2022/23 Budget		68,552			73,013			(1,000	)		(5,461	)
Increased taxation revenue		8,955									8,955
Increased natural resources revenue		2,811									2,811
Increased contributions from the federal government		1,186									1,186
Increased miscellaneous revenue		638									638
Increased other revenues		60									60
Decreased net earnings of self–supported Crown corporations and agencies		(666	)								(666	)
Increased health spending					2,637						(2,637	)
Increased natural resources and economic development spending					2,536						(2,536	)
Increased social services spending					1,736						(1,736	)
Increased protection spending					1,004						(1,004	)
Increased transportation spending					865						(865	)
Increased general government spending					678						(678	)
Decreased other spending					(1,637	)					1,637
Forecast allowance								1,000			1,000
Subtotal of changes in actual results compared to budget		12,984			7,819			1,000			6,165
Actual Results		81,536			80,832			0			704

Revenue was $12,984 million (18.9%) higher than the budgeted amount of $68,552 million and expenses were $7,819 million (10.7%) higher than the budgeted amount of $73,013 million. Additional spending over budget was authorized by supplementary estimates and various statutory appropriations.

Net Liabilities and Accumulated Surplus

In accordance with Canadian generally accepted accounting principles, the government’s Consolidated Statement of Financial Position is presented on a net liabilities basis. Net liabilities represent net future cash outflows resulting from past transactions and events. An analysis of net liabilities and accumulated surplus helps users to assess the government’s overall financial position and the future revenue required to pay for past transactions and events.

	In Millions									Variance
	2022/23  Budget			2022/23  Actual			2021/22  Actual			2022/23  Budget  to Actual			2022/23  vs  2021/22
	$			$			$			$			$
Financial assets		64,054			68,624			64,198			4,570			4,426
Less: liabilities		(133,665	)		(129,303	)		(121,662	)		4,362			(7,641	)
Net Liabilities		(69,611	)		(60,679	)		(57,464	)		8,932			(3,215	)
Less: non–financial assets		67,197			63,382			60,071			(3,815	)		3,311
Accumulated surplus		(2,414	)		2,703			2,607			5,117			96

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Financial Statement Discussion and Analysis Report

The accumulated surplus represents the sum of the current and prior years’ operating results, and accumulated changes in unrealized remeasurement gains and losses. At March 31, 2023, the accumulated surplus was $2,703 million, $5,117 million higher than budget. 

Financial assets were $4,426 million higher than 2021/22 as a result of increases in cash, cash equivalents and temporary investments of $1,105 million, loans for the purchase of assets, recoverable from agencies of $927 million, equity in self–supported Crown corporations and agencies of $411 million, and $1,983 million in other financial assets. 

Liabilities increased by $7,641 million from 2021/22. This was the result of an increase in amounts due to other governments of $2,435 million, an increase in deferred revenue of $1,626 million, an increase in self–supported debt of $1,123 million, a decrease of $2,001 million in taxpayer–supported debt, and an increase of $4,458 million in accounts payable and other liabilities. 

Non–financial assets typically represent resources, such as tangible capital assets, that the government can use in the future to provide services. Non–financial assets increased by $3,311 million over 2021/22 representing government’s investment in current year infrastructure spending.

Accumulated Surplus

The accumulated surplus represents current and all prior years’ operating results. In 2022/23, the province had an accumulated surplus of $2,703 million, $96 million higher than in 2021/22. The positive operating results of prior years continue to provide the flexibility to sustain core public services.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Components of Net Liabilities

Financial Assets 

Trend analysis of financial assets provides users with information regarding the amount of resources available to the government that can be converted to cash to meet obligations or fund operations.

	In Millions
	2018/19  Actual		2019/20  Actual		2020/21  Actual		2021/22  Actual		2022/23  Actual
	$		$		$		$		$
Cash, cash equivalents, temporary investments		3,029		3,985		6,560		7,142		8,247
Equity in self–supported Crown corporations and agencies		5,738		6,523		9,632		12,223		12,634
Loans, advances and mortgages receivable		2,395		2,952		4,032		4,199		4,763
Loans for the purchase of assets, recoverable from agencies		22,547		24,768		26,301		27,218		28,145
Other financial assets		10,994		10,144		11,870		13,416		14,835
Total financial assets		44,703		48,372		58,395		64,198		68,624

In 2022/23, financial assets increased by $4,426 million primarily due to an increase in cash, cash equivalents, and temporary investments of $1,105 million, an increase in recoverable capital loans of $927 million due to investments in power projects, and an increase in equity in self–supported Crown corporations and agencies of $411 million. The remaining financial assets including receivables, other investments, and derivative financial instruments increased by $1,983 million.

Liabilities 

Trend analysis of liabilities provides users with information to understand and assess the demands on financial assets and the revenue raising capacity of government.

	In Millions
	2018/19  Actual		2019/20  Actual		2020/21  Actual		2021/22  Actual		2022/23  Actual
		$		$		$		$		$
Taxpayer–supported debt		43,209		46,669		59,982		62,565		60,564
Self–supported debt		22,655		24,847		26,275		27,209		28,332
Total financial statement debt		65,864		71,516		86,257		89,774		88,896
Accounts payable and other liabilities		12,137		13,101		14,733		18,509		25,402
Deferred revenue		10,543		10,651		12,211		13,379		15,005
Total liabilities		88,544		95,268		113,201		121,662		129,303

In 2022/23, total liabilities increased by $7,641 million. Liabilities are obligations that must be settled at a future date by the transfer or use of assets. Taxpayer–supported financial statement debt decreased by $2,001 million and self–supported financial statement debt increased by $1,123 million. Information relating to the government’s debt management can be found in more detail in the analysis of the total provincial debt on page 25. Deferred revenue increased by $1,626 million and accounts payable and other liabilities increased by $6,893 million. Deferred revenue represents unearned revenues and restricted contributions that will be recognized as revenue in future periods.

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Financial Statement Discussion and Analysis Report

Non–financial Assets 

Trend analysis of non–financial assets provides users with information to assess the management of a government’s infrastructure and long–term non–financial assets.

	In Millions
	2018/19  Actual		2019/20  Actual		2020/21  Actual		2021/22  Actual		2022/23  Actual
	$		$		$		$		$
Tangible capital assets		47,902		50,095		52,851		56,133		59,811
Other non–financial assets		2,786		3,031		3,585		3,938		3,571
Total non–financial assets		50,688		53,126		56,436		60,071		63,382

Management of non–financial assets has a direct impact on the level and quality of services a government is able to provide to the public. Non–financial assets typically represent resources that government can use in the future to provide services. At March 31, 2023, non–financial assets were $63,382 million which was $3,311 million higher than 2021/22 and $12,694 million higher than fiscal 2018/19. The majority of the province’s non–financial assets represent capital expenditures for tangible capital assets net of amortization. The government has increased its investment in infrastructure spending by $3,678 million, to ensure service potential is available to deliver programs and services in future periods. Capital expenditures are not included on the Consolidated Statement of Operations and have no effect on the annual surplus (deficit). They reduce future operating results in the form of amortization expense as the service potential of assets is used to deliver programs and services.

Change in Capital Stock  

This measure shows the impact of net changes to the government’s stock of physical capital. Positive amounts demonstrate an investment in infrastructure to replace existing capital and provide service potential in future periods. 

The net annual investment in capital was $3,678 million in 2022/23, and $13,985 million since the start of fiscal 2018/19. Total capital stock has also increased steadily over that period, which indicates that capital infrastructure is available to continue providing programs and services in future periods.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Net Liabilities and Accumulated Surplus

	In Millions
	2018/19  Actual			2019/20  Actual			2020/21  Actual			2021/22  Actual			2022/23  Actual
	$			$			$			$			$
Financial assets		44,703			48,372			58,395			64,198			68,624
Less: liabilities		(88,544	)		(95,268	)		(113,201	)		(121,662	)		(129,303	)
Net liabilities		(43,841	)		(46,896	)		(54,806	)		(57,464	)		(60,679	)
Less: non–financial assets		50,688			53,126			56,436			60,071			63,382
Accumulated surplus		6,847			6,230			1,630			2,607			2,703

Net liabilities increased by $3,215 million in 2022/23. Liabilities include deferred revenue of $15,005 million which represents unearned revenues and restricted contributions that will be recognized as revenue in future periods. 

In the year, the financial measure of net liabilities has increased less than the increase in investments in infrastructure, resulting in an increase in accumulated surplus. The accumulated surplus of the province was $2,703 million at the end of 2022/23, indicating that the cumulative result of all past annual surpluses and deficits is positive, or that the province remains in a positive net financial position.

Non–financial Assets as a Portion of Liabilities

The chart provides an indication of the proportion of liabilities used to fund capital infrastructure as opposed to funding working capital requirements including accounts payable and other operating liabilities, as well as revenue deferred to future periods. Over the past five years, the relationship between non–financial assets and net liabilities has remained stable.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Net Liabilities to GDP

The net liabilities to GDP ratio provides an indication of the province’s ability to maintain existing programs and meet existing creditor requirements without increasing the debt burden on the economy as a whole.

The trend toward increased net liabilities to GDP reflects the ongoing impacts from the COVID–19 pandemic and disaster response, while the ratio returned to a more normal level in 2022/23. Net liabilities include deferred revenue that will be recognized as revenue in future periods, and obligations to outside parties including accounts payable and debt.

2018/19 to 2022/23

 

Surplus (Deficit) to GDP

The annual surplus (deficit) to GDP ratio is an indicator of sustainability that compares the province’s financial results to the overall results of the economy.

Results in the positive range of the chart indicate that the economy is growing faster than net government spending. Results in the negative range of the chart reflect government spending on initial pandemic response and recovery programs.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Total Provincial Debt

Total provincial debt is calculated differently than financial statement debt. Analysis of total provincial debt helps users to assess the extent of long–term liabilities and the government’s ability to meet future debt obligations.

	In Millions
	2018/19 Actual			2019/20 Actual			2020/21 Actual			2021/22 Actual			2022/23 Actual
	$			$			$			$			$
Gross debt		65,864			71,516			86,257			89,774			88,896
Less: sinking fund assets		(752	)		(692	)		(492	)		(510	)		(521	)
Third party guarantees and non–guaranteed debt		850			1,337			1,335			1,402			1,523
Foreign exchange adjustments														(472	)
Total provincial debt		65,962			72,161			87,100			90,666			89,426

When reporting to rating agencies, the province adds to its financial statement debt all debt guarantees and the debt directly incurred by self–supported Crown corporations, reduced by sinking fund assets. This balance is referred to as the total provincial debt.

Total provincial debt is $530 million higher than the amounts reported in the province’s financial statements after deducting sinking funds held to pay down the debt, unrealized foreign exchange adjustments of hedged foreign denominated debt translated to March 31, 2023 exchange rates and including guaranteed debt and the debt of self–supported Crown corporations.

Total provincial debt decreased by $1,240 million in 2022/23 due to less borrowing required as a result of improved operating results. Taxpayer–supported debt decreased by $2,407 million, including decreases for government direct operating debt of $7,233 million and education sector of $695 million. These were partly offset by increases for BC Transportation Financing Authority of $4,377 million, the health sector by $207 million, and other taxpayer–supported corporations and agencies by $937 million. The debt of self–supported Crown corporations and agencies increased $1,167 million for investments in power projects.

Taxpayer–supported debt to GDP

The ratio of taxpayer–supported debt to GDP is a key measure used by financial analysts and investors to assess a province’s ability to repay debt and is a key measure monitored by the bond rating agencies. A decreasing ratio means that debt is growing slower than the growth of the economy as measured by GDP.

At the end of 2022/23, taxpayer–supported debt to GDP was 15.4%, which was lower than the budgeted 20.0%, returning to a stable trend after the impacts of COVID–19 in 2020/21.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Strong Credit Rating

Reflecting the province’s fiscal performance, British Columbia has maintained a strong credit rating with all three credit rating agencies. In 2022/23, Moody’s Investors Service Inc. gave the province a Aaa credit rating (2022: Aaa); Standard and Poor’s gave the province a AA credit rating (2022: AA+); and Dominion Bond Rating Service gave the province a AA(high) credit rating (2022: AA(high)).

Credit Ratings March 31, 2023

Rating Agency1
	Moody’s Investors		Dominion Bond
Jurisdiction	Service Inc.	Standard and Poor’s	Rating Service
British Columbia	Aaa	AA	AA (high)
Alberta	Aa2	A+	AA (low)
Saskatchewan	Aa1	AA	AA (low)
Manitoba	Aa2	A+	A (high)
Ontario	Aa3	A+	AA (low)
Quebec	Aa2	AA–	AA (low)
New Brunswick	Aa2	A+	A (high)
Nova Scotia	Aa2	AA–	A(high)
Prince Edward Island	Aa2	A	A
Newfoundland	A1	A	A (low)
Canada	Aaa	AAA	AAA

¹The rating agencies assign letter ratings to borrowers. The major categories, in descending order of credit quality, are: AAA/Aaa; AA/Aa; A; BBB/Baa; BB/Ba; and B. The “1”, “2”, “3”, “high”, “low”, “–”, and “+” modifiers show relative standing within the major categories. For example, AA+ exceeds AA.

A more comprehensive overview of provincial debt, including key debt indicators is located on pages 139–152.

Public Debt Charges to Revenue (the Interest Bite)

The public debt charges to revenue indicator is often referred to as the “interest bite”. This provides users with the percentage of provincial revenue used to pay interest on debt. The ratio is sensitive to the cost of debt arising from either increasing interest rates or increasing debt, as well as decreases in revenue.

If an increasing proportion of provincial revenue is required to pay interest on provincial debt, less money is available to provide core public services. The interest bite has remained stable over the last five years. In 2022/23, the province spent 2.5 cents of each revenue dollar on interest on the provincial taxpayer–supported debt.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Non–Hedged Foreign Currency Debt to Total Provincial Debt

The ratio of non–hedged foreign currency debt to total provincial debt shows the degree of vulnerability of a government’s public debt position to swings in exchange rates.

Non–hedged foreign currency debt directly offset by instruments in the same foreign currency are considered “natural hedges”. These amounts are excluded from the ratio.

In 2022/23, the province had the equivalent of CAD $307 million in non–hedged debt.

2018/19 to 2022/23

 

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Financial Statement Discussion and Analysis Report

Economic Highlights

British Columbia’s economy grew by 3.6% in the 2022 calendar year, tied with Ontario for fourth highest among provinces, following a gain of 6.2% in 2021 according to preliminary GDP by industry data from Statistics Canada. The estimated 3.6% advancement for British Columbia in 2022 is an improvement compared to the government’s Budget 2023 estimate of 2.8% growth.

Real Gross Domestic Product in Calendar Year 2022

Both Service–producing industries and goods–producing industries experienced growth in 2022.

Service–producing industries saw 3.7% growth in 2022, with most sectors experiencing gains, except for wholesale trade (down 2.0%), retail trade (down 1.5%) and management of companies and enterprises sector (down 21.3%). Output in the transportation and warehousing (up 10.2%), accommodation and food services (up 19.6%), professional, scientific and technical services (up 5.6%), and healthcare and social assistance (up 3.8%) sectors were the main drivers of the increase. Service–producing sectors experienced a lift from the removal of remaining COVID–19 related restrictions in 2022, but several industries are still below 2019 GDP levels, such as accommodation and food services; transportation and warehousing; and arts, entertainment and recreation.

B.C.’s goods–producing industries grew by 3.3% in 2022, following growth of 5.7% in the previous year. Output in the construction industry provided the largest contribution of all sectors to growth in 2022 increasing by 5.8% compared to 2021. Increases were also observed in the manufacturing (up 3.1%), utilities (up 4.4%) and the mining, quarrying and oil and gas extraction sectors (up 1.7%). Meanwhile, the agriculture, forestry, fishing and hunting sector declined by 4.2% compared to 2021 and remained below pre–pandemic levels.

Provincial Comparison

 

Unemployment Rate

British Columbia’s annual unemployment rate was 4.6% in 2022, down from 6.6% in 2021, and was near record lows throughout most of the year. The unemployment rate in B.C. in 2022 was lower than the national unemployment rate of 5.3%. The average level of employment in B.C. increased by 3.2% in 2022, following a gain of 6.2% in 2021.

2018 to 2022

 

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Financial Statement Discussion and Analysis Report

Risks and Uncertainties

The government’s main exposure to risks and uncertainties arises from variables, which the government does not directly control. These include:

● assumptions underlying revenue and Crown corporation forecasts such as economic factors, commodity prices and weather conditions;

● the outcome of litigation, arbitration, and negotiations with third parties;

● potential changes to federal transfer allocations, cost–sharing agreements with the federal government and impacts on the provincial income tax bases arising from federal tax policy and budget changes;

● utilization rates for government services such as health care, children and family services, and income assistance;

● exposure to interest rate fluctuations, foreign exchange rates and credit risk; and

● changes in Canadian generally accepted accounting principles.

The following are the approximate effect of changes in some of the key variables on the surplus (deficit):

Key Fiscal Sensitivities
Variable	Increase Of	Annual Fiscal Impact ($ millions)
Nominal GDP	1%	$200 to $300
Lumber prices (US$/thousand board feet)	$50	$100 to $1501
Natural gas prices (Cdn$/gigajoule)	25 cents	$130 to $1502
US exchange rate (US cents/Cdn$)	1 cent	($25) to ($50)
Interest rates	1 percentage point	($186)
Debt	$500 million	($19) to ($20)

¹Sensitivity relates to stumpage revenue only.

²Sensitivities can vary significantly, especially at lower prices.

Although the government is unable to directly control these variables, strategies have been implemented to mitigate these risks and uncertainties. The development of taxation, financial and corporate regulatory policy to reinforce British Columbia’s position as an attractive place to invest and create jobs will help offset the increase in competition for investment as a result of globalization of economic and financial markets. As in previous years, the government applied a forecast allowance in the budget to account for risks to revenue, expenditure, and the forecasts of Crown corporations, school districts, universities, colleges, institutes, and health organizations (SUCH sector). The use of forecast allowances recognizes the uncertainties in predicting future economic developments.

Risk management in relation to debt is discussed in Note 20 on page 73 of the Notes to the Consolidated Summary Financial Statements.

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Consolidated

Summary Financial Statements

Province of British Columbia

For the Fiscal Year Ended

March 31, 2023

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Statement of Responsibility
for the Summary Financial Statements
of the Government of the Province of British Columbia

Responsibility for the integrity and objectivity of the Summary Financial Statements for the Government of the Province of British Columbia rests with the government. The Comptroller General prepares these financial statements in accordance with the Budget Transparency and Accountability Act (BTAA), which requires generally accepted accounting principles (GAAP) for senior governments in Canada, supported by regulations of Treasury Board under the BTAA. The fiscal year of the government is from April 1 to March 31 of the following year.

To fulfill its accounting and reporting responsibilities, the government maintains financial management and internal control systems. These systems give due consideration to costs, benefits and risks, and are designed to provide reasonable assurance that transactions are properly authorized by the Legislative Assembly, are executed in accordance with prescribed regulations and are properly recorded. This is done to maintain accountability of public money and safeguard the assets and properties of the Province of British Columbia under government administration. The Comptroller General of British Columbia maintains the accounts of British Columbia, a centralized record of the government’s financial transactions, and obtains additional information as required from ministries, Crown corporations, agencies, school districts, universities, colleges, institutes and health organizations to meet accounting and reporting requirements.

The Auditor General of British Columbia provides an independent opinion on the financial statements prepared by the government. The duties of the Auditor General in that respect are contained in section 11 of the Auditor General Act.

Annually, the financial statements are tabled in the legislature as part of the Public Accounts, and are referred to the Select Standing Committee on Public Accounts of the Legislative Assembly. The Select Standing Committee on Public Accounts reports to the Legislative Assembly with the results of its examination and any recommendations it may have with respect to the financial statements and accompanying audit opinions.

Approved on behalf of the Government of the Province of British Columbia:

/s/ Katrine Conroy

KATRINE CONROY

Chair, Treasury Board

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PUBLIC ACCOUNTS 2022/23

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Independent Auditor’s Report

To the Legislative Assembly of the Province of British Columbia:

Qualified Opinion

I have audited the Summary Financial Statements of the Government of the Province of British Columbia (“government”) using my staff and resources. The Engagement Leader, Molly Pearce, CPA, CA is responsible for this audit and its performance. The Summary Financial Statements of government comprise the consolidated statement of financial position as at March 31, 2023, and the consolidated statements of operations, change in net liabilities, remeasurement gains and losses and cash flows for the year then ended, and notes to the Summary Financial Statements including a summary of significant accounting policies.

In my opinion, except for the effects of the matters described in the basis for qualified opinion section of my report, the Summary Financial Statements present fairly, in all material respects, the financial position of government as at March 31, 2023, and the results of its operations, change in its net liabilities, remeasurement gains and losses, and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.

Basis for Qualified Opinion

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my qualified opinion.

I conducted my audit in accordance with Canadian generally accepted auditing standards. My responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Summary Financial Statements section of my report. I am independent of government in accordance with the ethical requirements that are relevant to my audit of the Summary Financial Statements in Canada, and I have fulfilled my other ethical responsibilities in accordance with these requirements.

Deferral of Revenues

Government’s accounting treatment for funds received from other governments, and for externally restricted funds received from non-government sources, is to initially record them as deferred revenue (a liability) and then recognize revenue in the statement of operations either on the same basis as the related expenditures occur or, in the case of funds for the purchase or construction of capital assets, to recognize revenue on the same basis as the related assets are amortized.

Under Canadian public sector accounting standards, government’s method of accounting for contributions is only appropriate in circumstances where the funding meets the definition of a liability. Otherwise, the appropriate accounting treatment is to record contributions as revenue when they are received or receivable. In my opinion, certain contributions from others do not meet the definition of a liability, and as such government’s method of accounting for those contributions represents a departure from Canadian public sector accounting standards.

This departure has existed since the inception of the standard, which applies to periods beginning on or after April 1, 2012. Had government made an adjustment to correct for this departure in the current year, the liability for deferred revenue as at March 31, 2023 would have been lower by $6.97 billion, contribution revenue, surplus for the year, and accumulated surplus would have been higher by $6.97 billion, and net liabilities would have been lower by $6.97 billion.

LEGISLATIVE ASSEMBLY OF THE PROVINCE OF BRITISH COLUMBIA

Independent Auditor’s Report

Incomplete Contractual Obligations Disclosure

Under Canadian public sector accounting standards, contractual obligations that commit government to make certain expenditures, for a considerable period into the future, are required to be disclosed so that financial statement users understand the nature and extent to which government’s resources are already committed to meet its future obligations. The Summary Financial Statements do not provide the required disclosures in relation to certain contracts, such as many contracts below the $50 million threshold noted in Note 28 – Contingent Liabilities and Contractual Obligations as well as larger contracts such as the obligation to the BC First Nations Gaming Revenue Sharing Limited Partnership (see following qualification). In my opinion, this represents a departure from Canadian public sector accounting standards. The following table, derived from historical information and management’s records, sets out the estimated effect of this departure on Note 28 – Contingent Liabilities and Contractual Obligations.

Understatement of Contractual Obligations	In Millions
											2029
											and
	2024		2025		2026		2027		2028		beyond		Total
	$		$		$		$		$		$		$
Consolidated Revenue Fund and Taxpayer-supported Crown corporations and agencies		987		604		455		427		384		2,070		4,927

BC First Nations Gaming Revenue Sharing Agreement Accounting Treatment

On October 31, 2019, amendments to the Gaming Control Act (the Act) added Division 4 – First Nations Revenue Sharing. On September 16, 2020, the Province of British Columbia entered into the Long-Term BC First Nations Gaming Revenue Sharing and Financial Agreement (the Agreement) which sets out the administrative mechanism for implementing the amendments to the Act. Both the amendments and the Agreement set out the direction to pay 7% of the net income of British Columbia Lottery Corporation (BCLC) to the BC First Nations Gaming Revenue Sharing Limited Partnership (the Partnership) each year for 23 years commencing in 2022.

Under Canadian public sector accounting standards, this arrangement should be accounted for on a gross basis, whereby, the net income of BCLC should be included in the revenue of government and the transfer of 7% of the BCLC net income made to the Partnership should be recorded as a government transfer expense. Note disclosures associated with this transaction should reflect this accounting treatment. Government’s Summary Financial Statements have accounted for this transaction on a net basis. As a result, neither the revenues nor the expenses have been reflected on the statement of operations. Note 39 – Dedicated Revenues describes the transaction as a “flow-through” arrangement. In my opinion, government’s method of accounting for the Agreement, and the disclosure in Note 39 – Dedicated Revenues, represents a departure from Canadian public sector accounting standards.

The effect of this departure is an understatement of both revenues and expenses on the statement of operations in the current year of $113.6 million, and an inaccurate characterization of this transaction as a “flow-through” arrangement in Note 39. Additionally, the Agreement represents a contractual obligation that should be included in Note 28 – Contingent Liabilities and Contractual Obligations (see previous qualification).

 

LEGISLATIVE ASSEMBLY OF THE PROVINCE OF BRITISH COLUMBIA

Independent Auditor’s Report

Key Audit Matters

Key audit matters are those that, in my professional judgment, were of most significance in my audit of the Summary Financial Statements of the current period. These matters were addressed in the context of my audit of the Summary Financial Statements as a whole and in forming my opinion thereon and I do not provide a separate opinion on these matters. In addition to the matters described in the basis for qualified opinion section, I have determined the matters described below to be the key audit matters to be communicated in my report.

Estimate of Personal and Corporate Income Taxation Revenue

Personal and corporate income tax are two of government’s largest tax revenue streams, estimated at more than $17.3 billion and $9.2 billion respectively, for fiscal 2023. These two revenue streams are included in Note 29 – Taxation Revenue with further information included in Note 2 - Measurement Uncertainty.

Personal and corporate income tax revenue in a fiscal year is derived from management’s estimate of income tax for two separate calendar years. For the fiscal year ending March 31, 2023, government records nine months of revenue for calendar year 2022 and three months of revenue for calendar year 2023. However, the tax assessments for the 2022 calendar year will not be finalized until many months later, and the 2023 tax assessments won’t be available until one year later. This means precise income tax revenue figures cannot be determined until at least 21 months after the fiscal year-end date. As a result, government is required to estimate these revenues based on the best information available at the time of reporting. For the current year, this included ensuring the estimates incorporated information received in the most recent tax sharing statements received in late July. Both the estimates are complex and include several inputs and assumptions and as a result have collectively been identified as a key audit matter.

Audit work to address this key audit matter included assessing the appropriateness of the methods used to make the estimates and performing a retrospective review to evaluate the accuracy of the models used. Audit work was also performed work to ensure the underlying data supporting management’s estimates is correct, testing the accuracy of management’s calculations supporting the estimates and developing range estimates to assess management’s estimates against. Audit procedures also included a review of the estimates for indications of management bias, an evaluation of the quality of the measurement uncertainty disclosure in the Summary Financial Statements and obtaining written representations from management related to estimates.

An auditor’s specialist was engaged to assist with the audit of these complex estimates.

Financial Instruments and Related Standards

Effective for the current year, government adopted a suite of public sector accounting standards related to financial instruments. These standards include PS3450: Financial Instruments, PS3041: Portfolio Investments, PS2601: Foreign Currency Translation, and PS1201: Financial Statement Presentation. As described in Note 1(d), government’s financial instruments include cash, receivables, investments, payables and debt, as well as derivative instruments such as cross-currency swaps, interest rate swaps, and forward foreign exchange contracts. Government has over $90 billion in long-term debt. Government hedges the risks that arise related to their debt borrowing using the aforementioned derivative instruments. Financial instruments can be difficult to measure and can expose government to risks. These standards are designed to provide financial statement users with information about how the instruments were measured, and the extent to which government is exposed to risks arising from the financial instruments it holds.

These accounting standards require government to present a new statement called the statement of remeasurement gains and losses, which is designed to show gains and losses associated with changes in the value of financial instruments from one period to the next, along with any changes resulting from financial instrument transactions that occurred during the period. These standards also require government to include key disclosures relating to its financial instruments, such as the fair value for government’s $7.5 billion investments, distinguishing between three categories of measurement to help financial statement users understand the level of subjectivity associated with their measurement. Furthermore, government is required to make certain disclosures related to the risk exposure associated with their use of financial instruments, including disclosures relating to liquidity risk, interest rate risk, foreign exchange risk, credit risk and other market risks. The valuation of financial instruments is complex and involves significant judgments and estimates, and there are extensive disclosure requirements on the risks associated with government’s use of these instruments. As a result, the adoption of these standards has been identified as a key audit matter.

 

LEGISLATIVE ASSEMBLY OF THE PROVINCE OF BRITISH COLUMBIA

Independent Auditor’s Report

Audit work to address this key audit matter included assessing government’s accounting policy for compliance with these standards, evaluating the completeness of the scoped in financial instruments, assessing the appropriateness of government’s methodology, data, and assumptions to value derivative financial instruments, assessing significant contracts for embedded derivatives, reviewing documents to assess the appropriateness of the new statement of remeasurement gains and losses, and evaluating the presentation and disclosure of financial instruments in accordance with the requirements of Canadian public sector accounting standards.

An auditor’s specialist was engaged to assist with the audit of fair values of the derivative financial instruments.

Valuation of Plan Assets and Pension Benefits for Pension Plans

Government participates in four jointly trusteed pension plans that include a joint defined benefit component for most British Columbia public servants. The estimated plan assets and accrued benefit obligations of these plans both exceed $89 billion.

Pension plan accounting values plan assets at market-related value for funded plans. Market-related value is derived from the fair value of plan assets reported in the pension plan financial statements. When observable market data is not available for investments, estimates of fair value are required. Fair value estimates require significant management judgment.

Government relies on a third-party actuarial specialist to estimate the accrued benefit obligation and other information for financial statement note disclosures. These calculations rely on management’s assumptions for significant economic and demographic assumptions.

Valuing pension benefits is a complex area requiring significant judgement and estimates. Given the magnitude of the accrued benefit obligation, small changes to the long-term assumptions can have a material impact on the liability, or asset, and expenses. As a result, pension plan accounting has been identified as a key audit matter.

Audit work to address this key audit matter included performing procedures to rely on the pension plan auditor’s reports for the plan assets used in the estimates, as well as their work over the data provided by management to the actuary for making the estimate. Audit work also included assessing the qualifications of management’s actuarial expert, gaining an understanding of the assumptions and methods used by the actuary in determining the accrued benefit obligation for pension benefits, obtaining the actuarial report, audited pension plan financial statements and other supporting documentation to test management’s assumptions, calculations and journal entries for pension accounting and evaluating the presentation and disclosure of pension plans in accordance with the requirements of Canadian public sector accounting standards.

 

LEGISLATIVE ASSEMBLY OF THE PROVINCE OF BRITISH COLUMBIA

Independent Auditor’s Report

Asset Retirement Obligations

Effective for the current year, government adopted the new public sector accounting standard PS3280: Asset Retirement Obligations. This new standard requires government to record a liability for obligations related to the retirement of assets. It defines which retirement activities should be accrued for, establishes when to recognize the liability, how to measure asset retirement obligations, and provides requirements for financial statement presentation and disclosure. As at March 31, 2023, government recorded $1.87 billion in asset retirement obligations, with $1.7 billion reported for the prior year which has been restated.

The Summary Financial Statements provide information about the impact of the implementation of this new standard in Note 1(e) changes in accounting policy – Adoption of Public Sector Accounting Standards PS 3280, Asset Retirement Obligations. Further information is included in note 1(d) significant accounting policies – Asset Retirement Obligations, Note 12 - Accounts Payable and Accrued Liabilities and Note 36 - Asset Retirement Obligations.

The adoption of this standard required government to identify tangible capital assets with retirement activities meeting the definition of an asset retirement obligation, estimate the cost to complete retirement activities, and determine when retirement activities will occur. This process was complex and required significant judgment and assumptions and as a result, has been identified as a key audit matter.

Audit work to address this key audit matter included assessing government’s accounting policy for asset retirement obligations, evaluating the completeness and accuracy of identified tangible capital assets with qualifying retirement activities, assessing the appropriateness of government’s methodology, data, and assumptions to estimate the cost of retirement activities, and evaluating the presentation and disclosure of asset retirement obligations in accordance with the requirements of Canadian public sector accounting standards. This also included assessing the qualifications and work of government’s experts engaged to assist in the estimation process.

Other accompanying information

Government is responsible for the information they report in the annual Public Accounts. My opinion on the Summary Financial Statements does not cover other information included in the annual Public Accounts that accompanies the Summary Financial Statements and, except for my independent auditor’s report on the debt-related statements, I do not express any form of assurance conclusion thereon.

In connection with my audit of the Summary Financial Statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Summary Financial Statements, or my knowledge obtained during the audit or otherwise appears to be materially misstated.

Prior to the date of my auditor’s report, I obtained a copy of the Public Accounts. If, based on the work I have performed on the other information, I conclude that there is a material misstatement therein, I am required to report that fact in this auditor’s report.

As described in the basis for qualified opinion section above, I believe there are material misstatements in government’s accounting for deferral of revenues. I have concluded that the other information is materially misstated for the same reason with respect to the amounts or other items in the annual report affected by this departure from Canadian public sector accounting standards.

Responsibilities of Treasury Board for the Summary Financial Statements

The Treasury Board of British Columbia is responsible for the oversight of the financial reporting process including the approval of significant accounting policies. The Comptroller General of British Columbia (comptroller general) is responsible for the preparation and fair presentation of the Summary Financial Statements in accordance with the Budget Transparency and Accountability Act, and for such internal control as the comptroller general determines is necessary to enable the preparation of the Summary Financial Statements that are free from material misstatement, whether due to fraud or error.

 

LEGISLATIVE ASSEMBLY OF THE PROVINCE OF BRITISH COLUMBIA

Independent Auditor’s Report

In preparing the Summary Financial Statements, the comptroller general is responsible for assessing government’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting when government will continue its operations for the foreseeable future.

Auditor’s responsibilities for the audit of the Summary Financial Statements

My objectives are to obtain reasonable assurance about whether the Summary Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion in accordance with generally accepted accounting principles, being public sector accounting standards for senior governments in Canada. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Summary Financial Statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, I exercise professional judgment and maintain professional skepticism throughout the audit. I also:

● Identify and assess the risks of material misstatement of the Summary Financial Statements, whether due to fraud or error; design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

● Obtain an understanding of internal control relevant to the audit 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 government’s internal control.

● Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the comptroller general.

● Conclude on the appropriateness of the comptroller general’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on government’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the Summary Financial Statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause government to cease to continue as a going concern.

● Evaluate the overall presentation, structure and content of the Summary Financial Statements, including the disclosures, and whether the Summary Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

The audit of the Summary Financial Statements is a group audit engagement. As such I also obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the Summary Financial Statements. I am responsible for the direction, supervision and performance of the group audit and I remain solely responsible for my audit opinion.

 

LEGISLATIVE ASSEMBLY OF THE PROVINCE OF BRITISH COLUMBIA

Independent Auditor’s Report

I communicate with the Chair of Treasury Board regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

I also provide the Chair of Treasury Board with a statement that I have complied with relevant ethical requirements regarding independence, and communicated with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards.

/s/ Michael A. Pickup

Michael A. Pickup, FCPA, FCA

Auditor General of British Columbia

Victoria, British Columbia, Canada

August 22, 2023

 

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA	43
PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Statement of Financial Position

as at March 31, 2023

			In Millions
	Note		2023			2022
						as restated
			$			$
Financial Assets
Cash and cash equivalents				7,833			6,827
Temporary investments				414			315
Accounts receivable		3		7,396			6,779
Inventories for resale		4		103			74
Due from other governments		5		1,360			1,778
Due from self–supported Crown corporations and agencies		6		421			331
Equity in self–supported Crown corporations and agencies		7		12,634			12,223
Loans, advances and mortgages receivable		8		4,763			4,199
Other investments		9		4,371			3,944
Sinking fund investments		10		521			510
Derivative financial instruments		20		663
Loans for purchase of assets, recoverable from agencies		11		28,145			27,218
				68,624			64,198
Liabilities
Accounts payable and accrued liabilities		12		17,386			14,060
Employee future benefits		13		3,234			3,075
Due to other governments		14		3,108			673
Due to Crown corporations, agencies and trust funds		15		643			701
Deferred revenue		16		15,005			13,379
Taxpayer supported debt		18		60,564			62,565
Self–supported debt		19		28,332			27,209
Derivative financial instruments		20		1,031
				129,303			121,662
Net assets (liabilities)		21		(60,679	)		(57,464	)
Non–financial Assets
Tangible capital assets		22		59,811			56,133
Restricted assets		23		2,224			2,147
Prepaid program costs		24		1,104			1,347
Other assets		25		243			444
				63,382			60,071
Accumulated surplus (deficit)		26		2,703			2,607
Measurement uncertainty		2
Employee pension plans		17
Contingent assets and contractual rights		27
Contingent liabilities and contractual obligations		28

The accompanying notes and supplementary statements are an integral part of these consolidated financial statements.

Prepared in accordance with Canadian generally accepted accounting principles.

/s/ Carl Fischer

CARL FISCHER

Comptroller General

44	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Statement of Operations

for the Fiscal Year Ended March 31, 2023

	In Millions
	2023						2022
	Estimates						Actual
	(Note 34)			Actual			as restated
	$			$			$
Revenue
Taxation (Note 29)		40,070			49,025			40,717
Contributions from the federal government		11,340			12,526			11,980
Fees and licenses		4,886			4,928			4,584
Miscellaneous		3,807			4,445			3,910
Net earnings of self–supported Crown corporations and agencies (Note 7)		3,764			3,098			5,424
Natural resources (Note 30)		3,387			6,198			4,471
Investment income		1,298			1,316			1,306
		68,552			81,536			72,392
Expense (Note 31)
Health		27,685			30,322			27,591
Education		16,673			16,991			15,801
Social services		7,916			9,652			7,268
Other		7,484			5,736			3,082
Natural resources and economic development		3,748			6,284			5,213
Interest		2,926			2,719			2,742
Protection of persons and property		2,479			3,483			2,937
Transportation		2,454			3,319			4,453
General government		1,648			2,326			2,040
		73,013			80,832			71,127
Surplus (deficit) for the year before forecast allowance		(4,461	)		704			1,265
Forecast allowance		(1,000	)
Surplus (deficit) for the year		(5,461	)		704			1,265
Accumulated surplus (deficit)—beginning of year as restated (Note 26)					2,201			946
Net remeasurement gains and (losses)					(202	)		396
Accumulated surplus (deficit)—end of year					2,703			2,607

The accompanying notes and supplementary statements are an integral part of these consolidated financial statements.

PROVINCE OF BRITISH COLUMBIA	45
PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Statement of Change in Net Liabilities

for the Fiscal Year Ended March 31, 2023

	In Millions
	2023						2022
							Actual
	Estimates1			Actual			as restated
	$			$			$
Surplus (deficit) for the year		(5,461	)		704			1,265
Effect of change in tangible capital assets:
Acquisition of tangible capital assets		(9,279	)		(6,755	)		(6,020	)
(Gain) or loss on sale of tangible capital assets		(22	)		(40	)		(18	)
Amortization of tangible capital assets		2,815			2,926			2,681
Disposals and valuation adjustments		20			191			74
		(6,466	)		(3,678	)		(3,283	)
Effect of change in:
Restricted assets		(66	)		(77	)		(144	)
Prepaid program costs		(6	)		243			(83	)
Other assets		1			201			(126	)
		(71	)		367			(353	)
Effect of self–supported Crown corporations’ and agencies’ other comprehensive income		10			231			(287	)
Effect of net remeasurement gains and (losses)					(829	)
Effect of change in other investments2					(10	)
(Increase) in net liabilities		(11,988	)		(3,215	)		(2,658	)
Net (liabilities)—beginning of year		(57,623	)		(57,464	)		(54,806	)
Net (liabilities)—end of year (Note 21)		(69,611	)		(60,679	)		(57,464	)

The accompanying notes and supplementary statements are an integral part of these consolidated financial statements.

¹The estimates amounts are from page 178 of the Budget and Fiscal Plan 2022/23–2024/25.

²Due to adoption of the financial instruments accounting standard during fiscal 2023.

46	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Statement of Remeasurement Gains and Losses

for the Fiscal Year Ended March 31, 2023

	In Millions
	2023			2022
	$			$
Accumulated remeasurement gains (losses) – beginning of year, before other comprehensive income		0			0
Adjustments for adoption of the financial instruments–related standards:
Foreign exchange		120
Derivatives		144
Portfolio investments1		128
Total adjusted accumulated remeasurement gains (losses) – beginning of year		392			0
Changes in unrealized gains (losses) attributable to:
Foreign exchange		(1,125	)
Derivatives		286
Portfolio investments		(47	)
Total changes in unrealized gains (losses)		(886	)		0
Amounts reclassified to the statement of operations:
Foreign exchange		533
Derivatives		(798	)
Portfolio investments		(70	)
Total reclassified to the statement of operations		(335	)		0
Total remeasurement gains (losses) attributable to:
Foreign exchange		(472	)
Derivatives		(368	)
Portfolio investments		11
Remeasurement gains and (losses), before other comprehensive income from self–supported Crown corporations and agencies		(829	)		0
Accumulated other comprehensive income from self–supported Crown corporations and agencies – beginning of the year		396			683
Other comprehensive income from self–supported Crown corporations and agencies		231			(287	)
Accumulated other comprehensive income from self–supported Crown corporations and agencies		627			396
Accumulated remeasurement gains (losses) – end of year		(202	)		396

The accompanying notes and supplementary statements are an integral part of these consolidated financial statements.

¹Portfolio investments include equities, bonds and certain other investments designated to the fair value measurement category.

PROVINCE OF BRITISH COLUMBIA	47
PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Statement of Cash Flow

for the Fiscal Year Ended March 31, 2023

	In Millions
	2023								2022
	Receipts		Disbursements			Net			Net as restated
	$		$			$			$
Operating Transactions
Surplus (deficit) for the year1							704			1,265
Non–cash items included in surplus (deficit):
Amortization of tangible capital assets							2,926			2,681
Amortization of public debt deferred revenue and deferred charges							40			(57	)
Concessionary loan adjustments increase							10			5
(Gain) or loss on sale of tangible capital assets							(40	)		(18	)
Valuation adjustment							305			118
Net earnings of self–supported Crown corporations and agencies							(3,098	)		(5,424	)
Temporary investments (increase) decrease							(99	)		82
Accounts receivable (increase)							(705	)		(892	)
Due from other governments decrease (increase)							418			(67	)
Due from self–supported Crown corporations and agencies (increase)							(90	)		(49	)
Accounts payable and accrued liabilities increase							3,326			3,526
Employee future benefits increase							159			210
Due to other governments increase							2,435			50
Due to Crown corporations, agencies and funds (decrease)							(58	)		(9	)
Employee pension plan (decrease)										(1	)
Items applicable to future operations increase							1,875			925
Dividends from self–supported Crown corporations and agencies							2,919			2,546
Cash derived from operations							11,027			4,891
Capital Transactions
Tangible capital assets dispositions (acquisitions)		183		(6,755	)		(6,572	)		(5,955	)
Cash (used for) capital		183		(6,755	)		(6,572	)		(5,955	)
Investment Transactions
Investment in self–supported Crown corporations and agencies				(1	)		(1	)
Loans, advances and mortgages receivable (issues)		256		(872	)		(616	)		(187	)
Other investments—net (increase)				(414	)		(414	)		(601	)
Restricted assets—net (increase)				(77	)		(77	)		(144	)
Sinking fund investments—net (increase)		23		(44	)		(21	)		(30	)
Cash (used for) investments		279		(1,408	)		(1,129	)		(962	)
Sub–total cash excess (requirements)							3,326			(2,026	)

48	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Statement of Cash Flow—Continued

for the Fiscal Year Ended March 31, 2023

	In Millions
	2023								2022
	Receipts		Disbursements			Net			Net
	$		$			$			$
Sub–total cash excess (requirements) carried forward from previous page							3,326			(2,026	)
Financing Transactions2
Public debt (decreases) increases		24,844		(26,166	)		(1,322	)		3,598
(Used for) purchase of assets, recoverable from agencies		9,224		(10,222	)		(998	)		(908	)
Cash (used for) derived from financing		34,068		(36,388	)		(2,320	)		2,690
Increase in cash and cash equivalents							1,006			664
Cash and cash equivalents—beginning of year							6,827			6,163
Cash and cash equivalents—end of year							7,833			6,827
Cash and cash equivalents are made up of:
Cash							7,059			5,843
Cash equivalents							774			984
							7,833			6,827

¹Interest received during the year was $1,304 million (2022: $1,302 million). Interest paid during the year was $2,696 million (2022: $2,725 million). Interest received includes interest income from the Statement of Operations in the amount of $1,316 million (2022: $1,306 million) plus the change in accrued interest receivable in the amount of $(12) million (2022: $(4) million). Interest paid includes interest expense from the Statement of Operations in the amount of $2,719 million (2022: $2,742 million) plus the change in accrued interest payable in the amount of $(23) million (2022: $(17) million).

²Financing transaction receipts are from debt issues and disbursements are for debt repayments.

The accompanying notes and supplementary statements are an integral part of these consolidated financial statements.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 49

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023

1. Significant Accounting Policies

(a) BASIS OF ACCOUNTING

The government’s Summary Financial Statements are prepared in accordance with the Budget Transparency and Accountability Act (BTAA), which requires generally accepted accounting principles (GAAP) for senior governments in Canada, supported by regulations of Treasury Board under the BTAA.

(b) REPORTING ENTITY

These financial statements include the accounts of organizations that meet the criteria of control (by the province) as established under Canadian Public Sector Accounting Standards. The reporting entity also includes government partnerships.

A list of organizations included in these consolidated financial statements may be found on pages 93 – 95. Trusts administered by government or government organizations are excluded from the reporting entity.

(c) PRINCIPLES OF CONSOLIDATION

Taxpayer–supported Crown corporations, agencies, and the school districts, universities, colleges, institutes, health organizations (SUCH) and the Consolidated Revenue Fund (CRF) are consolidated using the full consolidation method. The government’s interests in government partnerships are recorded on a proportional consolidation basis. Self–supported Crown corporations, agencies, entities and government business partnerships are consolidated using the modified equity basis of consolidation.

Organizations are reviewed annually to determine whether they can be expected to meet the definition of self–supported over their normal course of operations. In determining whether organizations will be able to maintain their operations and meet their liabilities from revenues received from sources outside of the government reporting entity, the following factors are considered as they apply:

i) The organization’s history of maintaining its operations and meeting its liabilities;

ii)  Whether the organization would continue to maintain its operations and meet its liabilities without relying on sales to, or subsidies in cash or kind from, the government reporting entity;

iii) Past, present and future economic conditions within which the organization operates; and

iv)  Whether the organization has realistic and specific plans that show how it expects to be able to maintain its operations and meet its liabilities in the future.

The status of self–supported organizations is not changed in response to financial results which are reasonably expected to be temporary in nature. Organizations are classified as self–supported on establishment and during a start up period if they are reasonably expected to meet the definition of self–supported in their normal course of operations.

The definitions of these consolidation methods can be found on page 153.

Adjustments are made for Crown corporations, agencies and entities whose fiscal year ends are different from the government’s fiscal year end of March 31. These Crown corporations, agencies and entities consist of all school districts (June 30).

Statistics Canada’s Financial Management System for Government Statistics provides the guidance for establishing segment disclosure and function reporting. The Consolidated Statement of Financial Position by Sector and the Consolidated Statement of Operations by Sector are found on pages 96 – 103. These statements include the operations of the CRF, taxpayer–supported Crown corporations and agencies, and SUCH sector organizations. Each taxpayer–supported Crown corporation, agency and SUCH sector organization is assigned to a sector based on its major activity. Sectors are identified using functions. The nature of each function is described in greater detail under Note 1(d) Classification by Sector. 

50 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

1. Significant Accounting Policies—Continued

(d) SPECIFIC ACCOUNTING POLICIES

Classification by Sector

The province uses the following sectors: health, education, social services, natural resources and economic development, protection of persons and property, transportation, general government, debt servicing and other.

The health sector includes the provincial health care system. It includes providing medical, hospital and preventive care, and other health–related services such as laboratories and diagnostic facilities.

The education sector includes education services. It includes elementary, secondary, and post–secondary schools. It also includes other education services such as programs to upgrade the skills of individuals and to provide apprenticeship training.

The social services sector includes outlays that the province made to help disadvantaged individuals and families overcome obstacles and circumstances which threaten their well–being. It includes counselling and rehabilitation services, transfer payments to individuals with a physical or mental disability, and services and goods provided by the province to the elderly.

The natural resources and economic development sector includes the promotion and development of industries, as well as the development and conservation of the natural resources on which these industries depend. It includes regulating the various industrial activities that are carried on in the province, as well as research related to resource conservation.

The protection of persons and property sector includes the protection of persons and property from negligence, abuse and crime. It includes policing, operating and maintaining courts of law and correctional facilities. It includes services related to new immigrants. It also includes negotiations to resolve land, resources, governance and jurisdictional issues with First Nations.

The transportation sector includes the operation and maintenance of transportation systems. This includes highway infrastructure, other road systems and public transit.

The general government sector is composed of three sub–categories. These are general administration, executive and legislature, and other general government services. General administration includes central accounting, budgeting, tax administration and collection, and other centralized administrative services. Executive and legislature includes the political, law enactment and constitutional activities of the province.

The debt servicing sector represents the financial impacts of activities related to management of public debt.

The other sector consists of activities, such as housing and culture, which cannot be allocated to any of the specifically described sector classifications.

Revenue

All revenue is recorded on an accrual basis. For corporate income tax, the cash received from the federal government is used as the basis for estimating the tax revenue. Annual tax revenues also include adjustments between the estimated revenues of previous years and actual amounts, as well as revenues from reassessments relating to prior years. Revenues do not include estimates of unreported taxes, or the impact of future reassessments that cannot be reliably determined.

Personal income tax revenue is accrued in the year earned based on estimates of household and taxable income. The revenue reported in the fiscal year is based on a pro-ration of the calendar year estimates.

Direct taxes, such as sales, fuel, carbon and tobacco, are recorded during the period in which the taxable event occurs and when authorized by legislation. Property tax revenues are recorded based on a pro–ration of actual property tax billings for each of the calendar years that comprise the fiscal year.

Taxes payable by the province in the normal course of operations are reported on the gross basis, as are the related expenses.

Tax concessions are accrued on the same basis as the associated tax revenues and reduce gross taxation revenue, but are not considered valuation allowances.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 51

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

1. Significant Accounting Policies—Continued

Royalty revenue is reported net of allowable credits integral to determining the amount of royalty. Amounts are reported as revenue when received or receivable.

Government transfers are recognized as revenues in the period during which the transfer is authorized and any eligibility criteria are met. Government transfers are deferred if they are restricted through stipulations for specific programs such as health transfers.

Expense

The cost of all goods consumed and services received during the year is expensed. Interest expense includes debt servicing costs such as amortization of discounts and premiums, realized foreign exchange gains and losses, and issue costs.

Pension expense is calculated as the cost of pension benefits earned by employees during the year, interest on the pension benefits liability, net of pension plan assets, and amortization of the government’s share of any experience gains or losses, less contributions made by members. The estimated total cost of government’s share of plan amendments related to past service is expensed in the year the plan is amended.

Government transfers include grants, entitlements and transfers under agreements, as defined in the definitions on page 154. Government transfers are recognized as expenses in the period in which the events giving rise to the transfer occurred, as long as the transfer is authorized, eligibility criteria have been met and a reasonable estimate of the amount can be made.

Financial Instruments

Financial instruments include primary instruments, such as cash, receivables, investments, payables, and debt, and derivative instruments such as interest rate swaps and currency swaps. Derivatives, portfolio investments in equities and bonds quoted in an active market, and certain other investments are measured at fair value. All other financial assets and liabilities are measured at cost or amortized cost. A government classifies fair value measurements using a hierarchy with the following levels:

Level 1: quoted prices in active markets for identical assets or liabilities

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability

Level 3: inputs that are not based on observable market data.

Derivatives are measured using internal models developed from observable market data (Level 2), portfolio investments are measured using quoted prices (Level 1), and certain other investments are measured with inputs not based on observable market data (Level 3). Unrealized gains and losses from changes in the fair value of financial instruments are recognized in the Consolidated Statement of Remeasurement Gains and Losses. Upon settlement, cumulative gains or losses are reclassified to the Consolidated Statement of Operations.

Assets

Assets are recorded to the extent they represent cash and claims upon outside parties, items held for resale to outside parties, prepaid expenses, deferred charges, derivative financial instruments, or tangible capital assets acquired as a result of events and transactions prior to year end.

Financial Assets

Cash and cash equivalents include cash on hand, demand deposits and short–term highly liquid investments that are readily convertible to known amounts of cash. These are subject to an insignificant risk of changes in value. These short–term investments generally have a maturity of three months or less and are held for the purpose of meeting short–term cash commitments rather than for investing.

52 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

1. Significant Accounting Policies—Continued

Temporary investments and Warehouse Program investments include short–term investments recorded at the lower of cost or market value. The fair values of short–term investments approximate their carrying values because of the short–term maturity of these instruments. Warehouse Program investments are short–term investments related to specific borrowings in advance of requirements under the Warehouse Borrowing Program.

Inventories for resale are expected to be sold within one year and include property that has been purchased, or for which development costs have been incurred, and that is held for ultimate resale or lease to outside parties. Inventories for resale are recorded at the lower of cost or net realizable value.

Equity in self–supported Crown corporations and agencies represents the province’s investment (including long–term advances) in those self–supported Crown corporations and agencies at cost, increases/decreases in the investees’ net assets, and other comprehensive income.

Loans for purchase of assets recoverable from agencies are recorded at maturity value, less unamortized premium or discount, deferred foreign exchange gains or losses and sinking fund balances. Premium/discount is amortized on a constant yield basis.

Loans and advances are recorded at cost less adjustment for any prolonged impairment in value. Mortgages receivable are recorded at the principal amount less valuation allowance, are secured by real estate and are repayable over varying terms. Concessionary loans and mortgages are recorded at net present value at issue, and related present value discounts are expensed. Valuation allowances are made when collectibility is considered doubtful. Interest is accrued on loans receivable only when collection is certain. Otherwise, it is recognized on the cash basis.

Investments in equities and bonds quoted in an active market and certain other investments are recorded at fair value. Other investments are recorded at the cost of acquisition, which may be adjusted by attributed income. Valuation adjustments are made when the value of investments is impaired.

Sinking fund investments are cash and marketable securities held specifically for the purpose of repaying outstanding debt at maturity. Sinking fund investments in marketable securities are recorded at fair value.

Tangible Capital Assets

Tangible capital assets are recorded at historical cost, plus asset retirement obligations, less accumulated amortization and valuation adjustments. The recorded cost, less the residual value, is generally amortized over the estimated useful lives of the assets on a straight–line basis.

All significant tangible capital assets of government organizations and operations have been capitalized. Intangible assets and items inherited by right of the Crown, such as forest, water and mineral resources, are not recognized in these financial statements. Crown land is capitalized at a nominal value of one dollar.

The value of collections (e.g. artifacts, documents, specimens, works of art) has been excluded from the Consolidated Statement of Financial Position. When collections are purchased, these items are expensed.

Liabilities

All liabilities are recorded to the extent they represent claims payable to outside parties as a result of events and transactions prior to year end. This includes probable losses on loan guarantees issued by the province, contingent liabilities (when it is likely a liability exists and the amount of the liability can be reasonably determined on an individual or portfolio basis), unfunded pension liabilities, and derivative financial instruments. Liabilities are not recorded for tax concessions or royalty credits which are integral in determining the amount of revenue.

Guaranteed debt includes guarantees by the Minister of Finance, made through specific agreements or legislation, to repay promissory notes, bank loans, lines of credit, mortgages and other securities. Loss provisions on guaranteed debt are recorded when it is likely that a loss will occur. The amount of the loss provision represents the best estimate of future payments less recoveries. The loss provision is recorded as a liability and an expense in the year determined and is adjusted as necessary to ensure it equals the expected payout of the guarantee.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 53

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

1. Significant Accounting Policies—Continued

Employee Pension Plans

The province accounts for employee pension plans by recognizing a liability and an expense in the reporting period in which the employee has provided service. The amount is calculated using the accrued benefit actuarial cost method. Where plans are in a net asset position and Joint Trusteeship Agreements restrict access to the assets, the province records the value of plan net assets as nil. The province records a liability for its share where plans are in a net obligation position. Changes in net liabilities/assets, which arise as a result of actuarial gains and losses, are amortized on a straight–line basis over the average remaining service period of employees active at the date of the adjustments. Past service costs from plan amendments are recognized in full in the year of the amendment.

Unfunded pension liabilities of the Members of the Legislative Assembly Superannuation Account represent the terminal funding that would be required from the province for the difference between the present value of the obligations for future benefit entitlements and the amount of funds available in the account.

Public Debt

Public debt represents the direct debt obligations of the Province of British Columbia, including borrowings incurred for government operating purposes, the acquisition of capital assets, re–lending to authorized government bodies and borrowings in advance of future requirements under the Warehouse Borrowing Program. Public debt is reported at amortized cost and consists of short–term promissory notes, notes, bonds and debentures, bank loans, capital leases and mortgages payable. These obligations are recorded at principal less unamortized premium or discount and are adjusted for unrealized foreign exchange gains or losses.

Public debt is reported under two categories:

(i) Taxpayer–supported debt—includes direct debt used for government operating and capital purposes, the debt of those Crown corporations, agencies and SUCH sector entities who require an operating or debt servicing subsidy from the provincial government, and the debt of an entity that is fully consolidated within these financial statements.

(ii) Self–supported debt—includes the portion of debt of self–supported organizations and entities that has been borrowed through the government’s fiscal agency loan program. It does not include all debt of self–supported organizations as these entities are consolidated on the modified equity basis. Self–supported organizations fully fund their operations and debt from revenue generated through the sale of goods and/or services at commercial rates to buyers that are outside the government reporting entity. Self–supported debt includes debt of the Warehouse Borrowing Program.

Debt premium/discount is amortized using the effective interest method. Unamortized premium/discount on bonds is amortized over the life of the debt.

Foreign Currency Translation

Monetary assets and liabilities denominated in foreign currencies are translated to Canadian dollars at the exchange rate prevailing at year end. Foreign currency transactions are translated at the exchange rate prevailing at the date of the transaction. Adjustments to revenue or expense transactions arising as a result of foreign currency translation are credited or charged to operations at the time the adjustments arise. Unrealized foreign currency gains and losses on long–term, fixed–term monetary assets and liabilities are reported in the Consolidated Statement of Financial Position and in the Consolidated Statement of Remeasurement Gains and Losses. Non–monetary assets and liabilities are translated at historical rates of exchange.

54 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

1. Significant Accounting Policies—Continued

Derivative Financial Instruments

The province is a party to financial instruments whose value may vary due to fluctuations in foreign currency exchange rates, interest rate fluctuations and counterparty default on financial obligations, and utilizes derivative financial instruments in hedging strategies to mitigate risk. The fair value of derivative financial instruments is reported in the Consolidated Statement of Financial Position and in the Consolidated Statement of Remeasurement Gains and Losses. The province does not use derivative financial instruments for speculative purposes. Off–balance sheet position data is given in the form of nominal principal amounts outstanding. Amounts earned and expenses incurred under swaps are recognized and offset against the related interest expense.

Other Comprehensive Income

Any recognition of other comprehensive income for self–supported Crown corporations has been reflected in the equity in self–supported Crown corporations and agencies, and in the accumulated surplus (deficit).

Asset Retirement Obligations

The province recognizes asset retirement obligations where there is a legal obligation to retire a tangible capital asset and a reasonable estimate of the fair value of the obligation can be determined. For assets that are not fully amortized, the associated retirement costs are capitalized as part of the carrying value and amortized over the underlying assets’ useful lives. Costs relating to obligations for fully amortized assets or assets no longer in productive use are expensed.

(e) CHANGES IN ACCOUNTING POLICY

Adoption of Public Sector Accounting Standards PS 1201, financial statement presentation; PS 2601, foreign currency translation; PS 3041, portfolio investments; and PS 3450, financial instruments

The province adopted these standards prospectively, beginning in this fiscal year. First–time effects of this change include an increase in financial assets of $11 million from portfolio investments adjusted to fair value, an increase to foreign currency–denominated debt of $472 million, and recognition of derivative financial instruments liabilities of $368 million, resulting in net remeasurement losses of $829 million before other comprehensive income from self–supported Crowns corporations and agencies.

Adoption of Public Sector Accounting Standards PS 3280, asset retirement obligations

The province adopted this standard on a modified retroactive basis with restatement, beginning in this fiscal year. The effects of this change include an increase in liabilities of $1,826 million (2022: $1,680 million), an increase in non–financial assets of $131 million (2022: $132 million), a decrease in accumulated surplus (deficit)–beginning of year of $1,548 million (2022: $1,507 million), and an increase in expense of $147 million (2022: $41 million).

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 55

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

2. Measurement Uncertainty

The preparation of financial statements requires the province to make estimates and assumptions that affect the amounts of assets, liabilities, revenues and expenses during the reporting period. Uncertainty in the determination of these amounts is known as measurement uncertainty.

Some of the more significant estimates used in these financial statements affect the accrual of tax revenues, Canada Health Transfer and Canada Social Transfer entitlements, liabilities for pension obligations and other employee future benefits, accruals for environmental obligations, future payments related to contingent liabilities, and valuation allowances for loans, investments and advances. Actual results could differ from estimates. For many common financial statement items, such as accounts payable and allowances for doubtful accounts, measurement uncertainty is inherent but inestimable.

A provision for environmental clean–up is included in accounts payable and accrued liabilities. The provision is subject to a high degree of measurement uncertainty because the existence and extent of contamination, the responsibility for clean–up, and the timing and cost of remediation cannot be reliably estimated in all circumstances. The degree of measurement uncertainty resulting from the estimation of the provision cannot be reasonably determined. Environmental clean–up disclosure is included in Note 28.

A provision for asset retirement obligations is included in accounts payable and accrued liabilities. The provision is subject to a high degree of measurement uncertainty due to the long–term nature of these liabilities and often indeterminate settlement dates. The degree of measurement uncertainty resulting from the estimation of the provision cannot be reasonably determined. Asset retirement obligation disclosure is included in Note 36.

The amount of personal income tax attributable to the year can change as a result of changes in the underlying revenue assumptions, such as household income growth and tax base growth, and as a result of tax assessments and reassessments. The amount of corporate income tax attributable to the tax year can change as a result of tax assessments and reassessments in subsequent years. Tax transfer expenses related to refundable tax credits attributable to the year are also impacted by both personal income tax and corporate income tax assessments and reassessments. The variability of the final amounts attributable to the year cannot be reasonably determined.

Estimates are based on the best information available at the time of preparation of the financial statements and are reviewed annually to reflect new information as it becomes available. The amount of variability cannot be reasonably determined at this time.

56 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

2. Measurement Uncertainty—Continued

Measurement uncertainty exists in these financial statements, as identified in the table below, for items with a variability of over $10 million:

	In Millions
	Actual1
	Amount		Measurement		Uncertainty		Range
Program Area	Recorded		Minimum		Maximum		Minimum			Maximum
	$		$		$		$			$
Liabilities
Accounts Payable and Accrued Liabilities
Litigation and Arbitration		166		141		216		(25	)		50
Crime Victim Assistance Program		223		190		225		(33	)		2
Silviculture Liability		200		180		220		(20	)		20
Employee Leave Entitlements		464		450		481		(14	)		17
Long–Term Disability Special Account		515		489		541		(26	)		26
Variability arises from uncertainty of the outcomes or the use of estimates.
Revenue
Taxation
Personal Income Tax		17,268		16,868		18,068		(400	)		800
Employer Health Tax		2,720		2,584		2,856		(136	)		136
Speculation and Vacancy Tax		52		44		60		(8	)		8
Provincial Sales Tax Rebate		100		95		106		(5	)		6
Natural Resources
Logging Tax		403		222		584		(181	)		181
Mineral and Mining Tax		817		749		1,001		(68	)		184
Contributions from the Federal Government
Canada Health Transfer payments2		6,176		6,131		6,221		(45	)		45
Canada Social Transfer payments2		2,177		2,161		2,193		(16	)		16
Expense (Note 31)
Government Transfers
Tax Transfers		3,919		3,719		4,119		(200	)		200
Variability is based on the potential differences between the estimates for the economic factors used in calculating the accruals and actual economic results.

¹Actual amount recorded for each program area may not represent the entire amount in the financial statement line item.

²Canada Health Transfer and Canada Social Transfer payments are transfers from the federal government based on the provincial share of national population figures.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 57

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

3. Accounts Receivable

	In Millions
	2023			2022
	$			$
Accounts receivable		4,340			4,049
Taxes receivable		3,453			3,169
Accrued interest		373			361
		8,166			7,579
Provision for doubtful accounts		(770	)		(800	)
		7,396			6,779

4. Inventories for Resale

	In Millions
	2023		2022
	$		$
Properties		40		13
Miscellaneous		63		61
		103		74

Inventories for resale are charged to the statement of operations when sold. During the year, the total cost of sales was $123 million (2022: $113 million) including the effect of write–downs of $1 million (2022: $1 million). Write–downs occurred due to obsolete materials no longer used, damaged goods, and reductions in the market value of goods.

5. Due from Other Governments

	In Millions
	2023		2022
	$		$
Government of Canada:
Current		1,272		1,692
Provincial governments:
Current		24		24
Local governments:1
Current		60		58
Long–term		4		4
		1,360		1,778

¹Local governments are municipal units established by the provincial government which include regional and metropolitan municipalities, cities, towns, townships, districts, rural municipalities and villages.

58 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

6. Due from Self–supported Crown Corporations and Agencies

	In Millions
	2023		2022
	$		$
British Columbia Lottery Corporation		177		168
British Columbia Liquor Distribution Branch		71		43
UBC Properties Investments Ltd.		54		49
Columbia Power Corporation		47		47
British Columbia Hydro and Power Authority		44		13
SFU Community Trust		18
Vancouver Island Technology Park Trust		7		7
Heritage Realty Properties Ltd.		3		4
		421		331

See Statement of Financial Position for Self–supported Crown Corporations and Agencies on pages 104 – 105 for details.

7. Equity in Self–supported Crown Corporations and Agencies

	In Millions
	2023											2022
	Investments		Unremitted Earnings			Other Comprehensive Income			Total			Total
	$		$			$			$			$
British Columbia Hydro and Power Authority		20		7,328			(58	)		7,290			6,980
Insurance Corporation of British Columbia				3,151			603			3,754			3,709
Columbia Power Corporation		26		186						212			197
British Columbia Lottery Corporation				(17	)		88			71			32
		46		10,648			633			11,327			10,918
Self–Supported Subsidiaries1
Columbia Basin Trust joint ventures2		941		24						965			966
British Columbia Railway Company3		107		130			(6	)		231			238
Great Northern Way Campus Trust4		72		(19	)					53			55
UBC Properties Investments Ltd.				45						45			33
SFU Community Trust				13						13			8
Vancouver Island Technology Park Trust5		1		(5	)					(4	)		1
Miscellaneous		1		3						4			4
		1,122		191			(6	)		1,307			1,305
		1,168		10,839			627			12,634			12,223

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 59

Notes to Consolidated Summary Financial Statements 

for the Fiscal Year Ended March 31, 2023—Continued

7. Equity in Self–supported Crown Corporations and Agencies—Continued

	In Millions
	2023											2022
	Investments		Unremitted Earnings			Other Comprehensive Income			Total			Total
	$		$			$			$			$
Change in Equity in Self–supported Crown Corporations and Agencies
Balance–beginning of year		46		10,470			402			10,918			8,309
Increase (decrease) in other comprehensive income							231			231			(286	)
Net earnings of self–supported Crown corporations and agencies				3,008						3,008			5,342
Dividends				(2,576	)					(2,576	)		(2,230	)
Adjustments to dividends				(254	)					(254	)		(217	)
Balance—end of year		46		10,648			633			11,327			10,918
Self–Supported Subsidiaries1
Balance–beginning of year		1,121		190			(6	)		1,305			1,323
Increase (decrease) in investment		1								1
Increase (decrease) in other comprehensive income													(1	)
Net earnings of self–supported Crown corporations and agencies				90						90			82
Dividends				(106	)					(106	)		(102	)
Transfers (to) from deferred revenue				17						17			3
Balance–end of year		1,122		191			(6	)		1,307			1,305
		1,168		10,839			627			12,634			12,223

¹Self–supported subsidiaries are non–core government business enterprises that are consolidated under the modified equity method by taxpayer–supported organizations.

²Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation and Waneta Expansion Power Corporation are jointly controlled with Columbia Power Corporation.

³A subsidiary of BC Transportation Financing Authority.

⁴Great Northern Way Campus Trust is owned 25% each by Emily Carr University of Art & Design, British Columbia Institute of Technology, The University of British Columbia, and Simon Fraser University.

⁵A subsidiary of the University of Victoria.

See Statement of Financial Position for Self–supported Crown Corporations and Agencies and Summary of Results of Operations and Statement of Equity for Self–supported Crown Corporations and Agencies on pages 104 – 107 for details.

60 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

8. Loans, Advances and Mortgages Receivable

	In Millions
	2023			2022
	$			$
Loans and Advances
Land tax deferment loans		1,900			1,669
Construction loans to social housing projects		1,222			927
BC student loans		1,120			1,094
Note receivable		618			610
Miscellaneous		211			189
		5,071			4,489
Provision for doubtful accounts		(324	)		(303	)
		4,747			4,186
Mortgages Receivable
Reconstruction Program		17			18
Provision for doubtful accounts		(1	)		(5	)
		16			13
		4,763			4,199

The Land Tax Deferment Program allows eligible owners to defer payment of all, or a portion of, annual property taxes due on principal residences. Eligible individuals are either 55 years of age or older, a surviving spouse, a person with a disability, or an owner who is financially supporting, at the time of application, a dependent child. The program for individuals 55 years of age or older, a surviving spouse, or a person with a disability, requires 25% equity in the home. The program for families with dependent children requires 15% equity in the home. Simple interest is charged on the deferred taxes at a rate set by the minister of finance. This rate will not exceed the prime lending rate of the principal banker to the government and there is a different interest rate between the two programs. The deferred taxes, plus any administration fees or outstanding interest, must be repaid before the residence can be legally transferred to a new owner, other than directly to a surviving spouse or adding a current spouse to title. Land Tax Deferment Loans are secured by registered charge on title.

Construction loans are provided by British Columbia Housing Management Commission (BCHMC), a taxpayer–supported Crown corporation and an approved lender under the National Housing Act. BCHMC provides construction loans for societies that are building approved projects under social housing programs. Interest is payable at the province’s weighted average borrowing rate for short–term funds, plus administration costs. Loans are repaid at substantial completion of each project from financing arranged with private lenders.

The BC Student Loan Program provides funding in the form of interest–free repayable loans to students for post secondary education leading toward a credential. Amortization of the loans is set on repayment commencement by the borrower. Most periods are 114 months in length but borrowers can extend that amortization to a maximum of 174 months if minimum payment requirements have been met. Defaulted loans are due on demand. The Ministry of Finance also administers defaulted student loans issued by financial institutions under a guaranteed or a risk sharing agreement with the province.

The note receivable is due to a sale of property by Providence Health Care Society.

Miscellaneous loans include housing and other loans receivable issued by The University of British Columbia of $48 million (2022: $42 million) in accordance with the University’s Housing Action Plan, bearing interest of nil or at the Canada Revenue Agency’s prescribed interest rate, with maturities up to 30 years, commercial loans of $33 million (2022: $25 million) issued by Columbia Basin Trust bearing interest of 3.65% to 10.20% maturing by 2048 and loans of $19 million (2022: $20 million) issued by University of Victoria to subsidiary government business enterprises bearing interest of 5.13% to 8.70% maturing by 2030.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 61

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

8. Loans, Advances and Mortgages Receivable—Continued

The Reconstruction Loan Program was established in 1998 under the Homeowner Protection Act to provide financial assistance to British Columbians who own homes damaged by premature building envelope failure and have limited ability to secure financing to pay for necessary remediation work. The financial assistance includes interest free loans as well as guarantees and interest subsidies of those loans provided by lenders outside of the government reporting entity. No new applicants under the program were being accepted after July 31, 2009. Financial assistance is secured by registered mortgages.

9. Other Investments

	In Millions
	2023		2022
	$		$
Pooled investment portfolios		2,804		2,622
Equity investments		637		459
Municipal, corporate and other bonds		133		132
British Columbia Ferry Services Inc.		75		75
Provincial government bonds		70		86
Government of Canada bonds		17		7
Commercial loans and investments		14		11
Miscellaneous		621		552
		4,371		3,944

Investments in equities and bonds traded on active markets and certain other investments are recognized at fair market value.¹ All other investments are recognized at cost.

Pooled investment portfolios consist mainly of units in various funds of the British Columbia Investment Management Corporation. These funds’ investments consist primarily of debt and equity holdings of privately held companies. Pooled investment portfolios have a market value of $2,811 million (2022: $2,748 million).

Equity investments have a historical cost of $417 million. They include investments in Canadian, United States (U.S.) and international equity markets.

Municipal, corporate and other bonds have a historical cost of $138 million with yields ranging from 1.09% to 7.96%. Maturity dates range from April 4, 2023 to May 26, 2082.

As part of a secured debenture amendment and preferred share surrender agreement dated May 23, 2003, the province exchanged its interest in British Columbia Ferry Corporation for 75,477 preferred shares in British Columbia Ferry Services Inc. These non–voting preferred shares are valued at $1,000 per share and entitle the province to a fixed cumulative dividend at a rate of 8% of the issue price.

Provincial bonds of various provinces have a historical cost of $77 million with yields ranging from 0.00% to 7.60%. Maturity dates range from April 17, 2024 to December 2, 2051.

Government of Canada bonds have a historical cost of $17 million with yields ranging from 0.25% to 5.75%. Maturity dates range from June 15, 2024 to December 1, 2064.

Commercial loans and investments are recorded at the lower of cost of acquisition adjusted by attributed income and market value. Commercial loans and investments include Columbia Basin Trust’s $14 million (2022: $11 million) investment in power developments and other investments.

Miscellaneous investments consist of other pooled funds as well as various forms of income securities, notes and treasury bills. The market value of miscellaneous investments is $621 million (2022: $676 million).

¹The fair market value recognition of investments began in fiscal 2023. In fiscal 2022 all investments were recognized at cost.

62 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

10. Sinking Fund Investments

	In Millions
	2023		2022
	$		$
Sinking fund investments related to taxpayer–supported debt		219		230
Sinking fund investments related to self–supported debt		302		280
		521		510

	In Millions
	2023		2022
	$		$
Provincial government bonds		515		490
Pooled investment portfolios		1		15
Local government bonds		5		5
		521		510

Provincial bonds of various provinces have a historical cost of $532 million, with yields ranging from 3.43% to 4.94%. Maturity dates range from April 17, 2023 to June 18, 2050.

Pooled investment portfolios have a historical cost of $1 million. These pooled investment portfolios consist of units in the British Columbia Investment Management Corporation’s bond funds, which mainly consist of various governments’ bonds and short–term unitized funds that hold money market instruments.

Local government bonds have a historical cost of $5 million, with yields of 4.49%. Maturity date is November 30, 2023. Local government bonds mainly consist of debt issued by the Municipal Finance Authority of British Columbia.

Sinking fund investments related to self–supported debt include Province of British Columbia bonds with a carrying value of $104 million (2022: $103 million).

Sinking fund investments are recorded at fair market value¹.

¹The fair market value recognition of investments began in fiscal 2023. In fiscal 2022 all investments were recognized at cost.

11. Loans for Purchase of Assets, Recoverable from Agencies

	In Millions
	2023		2022
	$		$
British Columbia Hydro and Power Authority		26,796		25,850
Columbia Basin Trust joint ventures1		945		958
Columbia Power Corporation		261		266
British Columbia Lottery Corporation		140		140
Improvement districts		3		4
		28,145		27,218

¹Columbia Basin Trust joint ventures with Columbia Power Corporation (Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation, and Waneta Expansion Power Corporation).

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 63

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

12. Accounts Payable and Accrued Liabilities

	In Millions
	2023		2022
	$		$
Accounts payable		9,672		7,676
Other accrued estimated liabilities1		5,090		3,936
Asset retirement obligations2		1,870		1,717
Accrued interest on debt		754		731
		17,386		14,060

¹Includes pending litigation, provision for guaranteed debt payout and other miscellaneous accrued claims as disclosed in Note 28.      

²See Asset Retirement Obligations disclosed in Note 36.      

13. Employee Future Benefits

	In Millions
	2023		2022
	$		$
Vacation, compensatory time off, sick bank		1,493		1,425
Retirement allowance		831		804
Long–term disability		469		420
Post–retirement benefits		222		239
Worker compensation benefits		219		187
		3,234		3,075

There are a variety of employee benefit plans across the reporting entity with different terms that provide for post–employment benefits, compensated absences, and termination benefits. The cost of benefits is recognized in the periods the employee provides service. A liability is recognized for benefits that do not vest or accumulate when an event that obligates the province to pay benefits occurs.

The retirement allowance includes actuarially determined liabilities. As at March 31, 2023, unamortized actuarial losses (gains) from actuarial estimates performed every three years were $17 million (2022: $22 million). During the year, the amount of benefits paid was $53 million (2022: $67 million).

Amounts recorded in the financial statements relating to long–term disability benefits represents the actuarial estimate for future payments based on claims ongoing at year–end.

Post–retirement benefits include amounts accrued for non–pension retiree and early retirement benefits.

Worker compensation benefits represent the actual premiums and claims costs accruing to WorkSafeBC for the year.

64 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

14. Due to Other Governments

	In Millions
	2023		2022
	$		$
Government of Canada:
Current		2,760		577
Provincial governments:
Current		17		26
Local governments:1
Current		331		70
		3,108		673

¹ Local governments are municipal units established by the provincial government that include regional and metropolitan municipalities, cities, towns, townships, districts, rural municipalities and villages.

15. Due to Crown Corporations, Agencies and Trust Funds

	In Millions
	2023		2022
	$		$
Columbia Basin Trust joint ventures1		619		627
Great Northern Way Campus Trust		9		9
Trust funds		15		65
		643		701

¹ Columbia Basin Trust joint ventures with Columbia Power Corporation (Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation, and Waneta Expansion Power Corporation).

16. Deferred Revenue

	In Millions
	2023		2022
	$		$
Deferred restricted contributions (see table)		11,953		10,342
Unearned lease revenue		1,297		1,265
Tuition		680		603
Motor vehicle licences and permits		308		301
Petroleum, natural gas and minerals, leases and fees		172		249
Water rentals and recording fees		135		124
Derivative debt instruments				64
Miscellaneous		460		431
		15,005		13,379

Unearned lease revenue represents lease payments received in advance. Revenue is recognized as the performance obligations are met over the term of the lease.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 65

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

16. Deferred Revenue—Continued

Petroleum, natural gas and minerals, leases and fees include payments received from external sources to obtain exclusive subsurface tenure rights to explore for, or produce, petroleum and natural gas resources. Revenue is recognized over the average term of the tenures issued, currently estimated at 10 years.

Deferred Restricted Contributions are those contributions received from external sources that are restricted through legislative or contractual stipulations for the purpose of program delivery. These deferred contributions are reduced and recognized as revenue when the stipulations of the contribution agreement are satisfied.

		In Millions
	Revenue Recognition	2023		2022
	(Years)	$		$
Restricted Contributions from the Federal Government
Build Canada fund for highway and transportation infrastructure	3–100		2,141		2,037
Infrastructure and economic diversification	20–50		880		691
Operating contributions for other sectors	1–12		744		589
Emergency response and recovery assistance	1–12		695
Operating contributions for the education sector	1–12		553		560
Strategic infrastructure fund investments in post–secondary institutions	3–40		399		362
Miscellaneous contributions for post–secondary institutions	1–40		72		83
Regional services and facilities in the health sector	3–40		41		20
Miscellaneous contributions for transportation infrastructure	1–40		12		81
Other	1–40		2		83
Restricted Contributions from Municipal Sources
Regional hospital districts for equipment and facilities	3–40		1,345		1,279
Bylaw capital funding for schools	3–40		162		144
Operating contributions for the transportation sector	1–12		94		114
Municipal transportation infrastructure funding	3–77		69		67
Restricted Contributions from Other Sources
Health endowments and other contributions	5–50		2,159		2,038
Education endowments	30		1,685		1,290
Operating contributions for the education sector	1–12		590		587
Operating contributions for the health sector	1–12		71		125
Operating contributions for the other sector	1–12		29		16
Miscellaneous contributions from other sources	5–50		210		176
			11,953		10,342

Impact to revenue for the next five fiscal years and thereafter is estimated to be:

	In Millions
	$
2024		2,775
2025		864
2026		594
2027		576
2028		1,365
Thereafter		5,779
Total deferred restricted contributions		11,953

66 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

17. Employee Pension Plans

Joint trusteed plans

The province contributes to four pension plans for substantially all of its employees. The four pension plans are the Public Service Pension Plan, the Municipal Pension Plan, the Teachers’ Pension Plan and College Pension Plan. The plans provide basic pensions based on length of service, highest five–year average earnings and plan members’ age at retirement. Benefits, such as group health benefits and inflation protection for the basic pension, are not guaranteed and are contingent upon available funding. No unfunded liability exists for the future indexing of pensions as the obligation is limited to the amount of available assets in separate inflation accounts.

The Public Service, Municipal, Teachers’ and College pension plans are joint trusteed plans. In joint trusteed plans, control of the plans and their assets is assumed by individual pension boards made up of plan employer and plan member appointed trustees. The Province participates as a plan employer in each plan. Provisions of these plans stipulate that the province has no formal claim to any pension plan surplus or asset. The boards are fully responsible for the management of the plans, including investment of the assets and administration of the plans. The BC Pension Corporation provides benefit administrative services as an agent of the boards of trustees. The British Columbia Investment Management Corporation provides investment management services as an agent of the boards of trustees.

In the event an unfunded liability is determined by an actuarial valuation (performed at least every three years), the pension boards are required to address it through contribution adjustments shared equally by plan members and employers.

The reported net assets or net obligations of the pension plans are administered under joint trust arrangements. The province has no claim on accrued asset amounts. The province is responsible for 50% of a reported net obligation. Settlement of the obligation will occur in future periods as contributions maintain a fully funded plan status over time. Also, only 70% of the pension fund assets, accrued benefit obligation, and preliminary current year employer contributions are included for the Municipal Pension Plan, reflecting the province’s interest in the plan.

The accrued benefit obligations and pension assets shown for 2022/23 are based on extrapolations of the most recent actuarial valuations as shown below. Fund assets are based on market–related value at the date of actuarial valuation and extrapolated using actuarial growth assumptions as shown in the following table. The expected long–term inflation rates used in these assumptions are nil, since the future indexing of pensions is limited to the amount of available assets in the inflation adjustment account.

Key actuarial assumptions, data and dates:

	Public Service Pension Plan	Municipal Pension Plan	Teachers’ Pension Plan	College Pension Plan
Date of actuarial valuation	Mar 31/20	Dec 31/21	Dec 31/20	Aug 31/21
Date of audited financial statements	Mar 31/22	Dec 31/21	Dec 31/21	Aug 31/22
Expected long–term rate of return used as discount rate	6.00%	6.00%	5.75%	6.00%
Expected average remaining service life of employee group	9.9 years	10.5 years	12.1 years	8.7 years
Normal actuarial cost used in extrapolations	15.76%	16.80%	17.24%	17.39%
Basic benefits paid during the plan’s fiscal year (in millions)	$1,244	$2,191	$1,309	$248
Total contribution rate for basic benefits (members and employers)	14.20%	15.08%	16.34%	16.88%
Assumed rate of salary escalation	3.25%	3.25%	3.25%	3.25%
Current benefit accrual rate	1.95%	1.90–2.12%	1.90%	2.00%
Entry–age normal cost rate–basic account	15.26%	15.49%	17.01%	16.83%
Market value of plan net assets at latest financial statement date (in millions)	$31,299	$42,526	$30,521	$5,130

Actuarial assumptions are decisions of the individual pension boards and have been collected from the latest audited financial statements and actuarial valuation of each pension plan. The audited financial statements and actuarial valuations of each pension plan listed, except the Account, may be found in the annual reports at www.pensionsbc.ca outside these audited statements.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 67

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

17. Employee Pension Plans—Continued

Accrued net obligation (asset) table:

The estimated financial position as at March 31, 2023, for the basic pension in each joint trusteed plan is as follows:

	In Millions
	Public Service Pension Plan			Municipal Pension Plan			Teachers’ Pension Plan			College Pension Plan			Total
	$			$			$			$			$
Accrued benefit obligation		24,616			35,281			24,429			4,955			89,281
Pension fund assets		28,451			42,444			27,871			5,478			104,244
		(3,835	)		(7,163	)		(3,442	)		(523	)		(14,963	)
Unamortized actuarial gain (loss)		827			3,594			2,455			168			7,044
Accrued net obligation (asset)		(3,008	)		(3,569	)		(987	)		(355	)		(7,919	)
Attributable to the province		(1,504	)		(1,784	)		(494	)		(177	)		(3,959	)
Valuation adjustment		1,504			1,784			494			177			3,959
Province’s reported net obligation		0			0			0			0			0

The province is obligated under labour contracts to provide retirement benefits for its employees through contributions to these pension plans. Contribution rates are adjusted to reflect the results of the triennial actuarial valuation of each plan. The province contributes approximately 50% of the total contributions for these plans; therefore, the province’s accrued net obligation is 50%. An accrued net obligation will not result in a payment to the plan, but will be addressed through increased contributions over time.

The preliminary overall fund rates of return (loss) reported to the pension boards as at December 31, 2022 for each plan are: the Public Service Pension Plan (3.2%) (2022: 12.3%), the Municipal Pension Plan (3.4%) (2022: 11.5%), the Teachers’ Pension Plan (3.3%) (2022: 11.7%), and the College Pension Plan (4.1%) (2022: 12.8%).

The province’s share includes contributions for all participants in the government reporting entity. When the plans are in an accrued net asset position for accounting purposes, pension expense for the period is equal to employer contributions. Total employer contributions this year for each plan are: the Public Service Pension Plan $514 million (2022: $478 million), the Municipal Pension Plan $954 million (2022: $938 million), the Teachers’ Pension Plan $428 million (2022: $406 million), and the College Pension Plan $125 million (2022: $121 million).

Members of the Legislative Assembly Superannuation Account

The Legislative Assembly Superannuation Account (the “Account”) is administered by the British Columbia Pension Corporation (the “BC Pension Corporation”). As members of the Legislative Assembly retire, the present value of the amount required to provide a legislative member’s future pension benefit is transferred from the Account to the Public Service Pension Plan from which monthly pensions are paid. The province contributes to this plan and provides additional funding when the present value of the funding exceeds the accumulated assets in the Account available to fund those members’ benefit entitlements in the plan. This plan provides basic pension benefits based on length of service, highest four–year average earnings and plan members’ age at retirement. Benefits, such as group health benefits and inflation protection for the basic pension, are not guaranteed and are contingent upon available funding.

68 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

17. Employee Pension Plans—Continued

Other pension plans 

Other pension plans represent defined benefit plans outside of the College, Public Service, Municipal, and Teachers’ Pension plans which are funded by entities within the government reporting entity and are included in other investments in Note 9. Total employer contributions this year for each plan are: Simon Fraser University’s Academic Pension Plan and Administrative/Union Pension Plan $29 million (2022: $25 million), the University of Victoria’s pension plan for employees other than faculty and professional staff $6 million (2022: $6 million), and Canadian Blood Services’ pension plan for regular employees $2 million (2022: $2 million). Only 14.67% of the pension fund assets and accrued benefit obligation are included for the Canadian Blood Services pension plan, reflecting the province’s interest in the plan.

The estimated financial position as at March 31, 2023, for the other pension plans is as follows:

	In Millions
	Simon Fraser University Pension Plan			University of Victoria Pension Plan			Canadian Blood Services Pension Plan			Total
	$			$			$			$
Accrued benefit obligation		430			273			78			781
Pension fund assets		485			315			79			879
		(55	)		(42	)		(1	)		(98	)
Unamortized actuarial gain (loss)		(43	)		(3	)					(46	)
Accrued net obligation (asset)		(98	)		(45	)		(1	)		(144	)

There are additional employee pension plans in Crown corporations and agencies consolidated on the modified equity basis. Total employer contributions this year for each plan are: British Columbia Hydro and Power Authority $51 million (2022: $51 million), British Columbia Lottery Corporation $14 million (2022: $13 million), and the Insurance Corporation of British Columbia (ICBC) $38 million (2022: $38 million). Net assets or net liabilities of the pension funds are included in the equity balance of the particular Crown corporation or agency in Note 7.

The estimated financial position as at March 31, 2023, for the pension plans of commercial Crown corporations is as follows:

	In Millions
	BC Hydro Pension Plan		ICBC Pension Plan			BC Lottery Pension Plan			BC Railway Pension Plan		Total
	$		$			$			$		$
Accrued benefit obligation		5,141		2,542			359			19		8,061
Pension fund assets		4,581		2,720			396			16		7,713
Accrued net obligation (asset)		560		(178	)		(37	)		3		348

PROVINCE OF BRITISH COLUMBIA 69

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

18. Taxpayer–supported Debt¹

	In Millions
	Year of Maturity		Canadian Dollar		US Dollar2		Other Currencies2		2023			2022
				$		$		$		$			$
Short–term promissory notes		2023								0			4,908
		2024		2,252		1,267				3,519			0
Notes, bonds and debentures3		2023								0			3,709
		2024		3,338						3,338			3,325
		2025		1,517		1,663		712		3,892			3,898
		2026		3,835				350		4,185			4,119
		2027		1,090		4,110		170		5,370			5,367
		2028		2,081						2,081			2,061
		2029–2033		12,618		2,224		392		15,234			13,701
		2034–2038		3,162				209		3,371			3,372
		2039–2043		5,073				502		5,575			5,588
		2044–2048		1,945				340		2,285			2,134
		2049–2053		8,336				1,245		9,581			9,330
		2054–2058		1,130						1,130			130
		2059–2063		181						181			181
		2064–2068								0			0
Capital leases		2023–2048		262						262			264
Total debt issued at face value				46,820		9,264		3,920		60,004			62,087
Unamortized premium										144			478
Unrealized foreign exchange (gain) loss4										416
Total taxpayer–supported debt										60,564			62,565
The effective interest rates (weighted average) as at March 31 on the above debt are:
2023										3.47	%
2022													3.13	%

¹The balances and interest rates reflect the impact of the related derivative contracts, presented in Note 20. 

²Foreign currency denominated debt as at March 31, 2023 includes USD$7,186 million which was fully hedged to CAD$9,264 million; 100 million Swiss Francs was fully hedged into CAD$96 million; 1,908 million EURO was fully hedged to CAD$2,807 million, $1,018 million AUD was fully hedged to CAD$1,017 million. 

³Notes, bonds, and debentures includes $24 million (2022: $26 million) in other loans. 

⁴The foreign currency denominated debt adjustment to exchange rates as at March 31, 2023, includes USD$7,186 million converted to CAD$9,724 million; 100 million Swiss Francs converted into CAD$148 million; 1,908 million EURO converted to CAD$2,806 million; and $1,018 million AUD converted to CAD$922million.

70 PROVINCE OF BRITISH COLUMBIA

 PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

18. Taxpayer–supported Debt—Continued

Notes, bonds and debentures

Redeemable by the province 

Balances include debentures issued to the Canada Pension Plan totalling $2,459 million (2022: $2,823 million) at a weighted average interest rate of 4.25% (2022: 4.49%). These debentures mature at various dates from April 7, 2023 to July 12, 2049 with interest rates varying between 1.98% and 5.98%. These debentures are redeemable in whole or in part before maturity, on thirty days prior notice, at the option of the province. During the year, no Canada Pension Plan debentures were issued (2022: $103 million).

Public–private partnership obligations 

Balances include the present value of the minimum payments related to tangible capital assets financed by public–private partnership agreements totalling $3,369 million (2022: $3,400 million).

Mortgages 

Balances include mortgages totalling $191 million (2022: $191 million) secured by land and buildings. The carrying value is $260 million (2022: $273 million).

Aggregate payments to meet sinking fund instalments and retirement provisions 

Aggregate payments for the next five fiscal years and thereafter to meet sinking fund instalments and retirement provisions on notes, bonds and debentures are:

	In Millions
	$
2024		3,734
2025		3,904
2026		4,182
2027		5,337
2028		2,071
2029–2068		37,196
Total of stated minimum payments		56,424

Capital Lease Obligations

Capital lease obligations consist of the present value of the minimum lease payments related to capital leased assets. The province has lease agreements with terms between 2 years and 42 years, with interest rates ranging between nil and 25.00%.

Major leases include: Vancouver Coastal Health Authority capital lease obligation for the Gordon and Leslie Diamond Health Care Centre of $92 million (2022: $95 million), with a weighted average interest rate of 5.37% and maturing August 1, 2036, Ministry of Citizens’ Services capital lease obligation for office space in Capital Park of $87 million (2022: $91 million), with a weighted average interest rate of 3.97% and maturing March 1, 2040, Thompson Rivers University lease agreements for land and student residences of $34 million (2022: $35 million), with a weighted average interest rate of 5.14% and maturing August 31, 2047, and British Columbia Institute of Technology capital lease obligation for the building at Annacis Island Campus of $22 million (2022: $15 million), with a weighted average interest rate of 4.00% and maturing July 31, 2044.

PROVINCE OF BRITISH COLUMBIA 71

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

18. Taxpayer–supported Debt—Continued

Aggregate payments to meet capital lease payments

Aggregate minimum lease payments over the next five fiscal years and thereafter are:

	In Millions
	$
2024		32
2025		29
2026		25
2027		23
2028		22
2029–2048		248
Total minimum lease payments		379
Less imputed interest		(117	)
Total capital lease liability		262

72 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

19. Self–supported Debt¹

	In Millions
	Year of Maturity		Canadian Dollar		US Dollar2		Other Currencies2		2023			2022
				$		$		$		$		$
Short–term promissory notes		2023								0		2,939
		2024		2,181		747				2,928		0
Notes, bonds and debentures		2023								0		500
		2024		200						200		200
		2025								0		0
		2026		900		648		391		1,939		1,923
		2027		850						850		850
		2028		1,000						1,000		1,000
		2029–2033		6,510				200		6,710		5,735
		2034–2038				378				378		370
		2039–2043		3,273						3,273		3,273
		2044–2048		2,900						2,900		2,900
		2049–2053		8,106						8,106		7,356
		2054–2058		60						60		60
		2059–2063		50						50		50
Total debt issued at face value				26,030		1,773		591		28,394		27,156
Unamortized premium (discount)										(118	)	46
Unrealized foreign exchange (gain) loss3										56		7
Total self–supported debt										28,332		27,209
The effective interest rates (weighted average) as at March 31 on the above debt are:
2023										3.20	%
2022												3.12	%

¹The balances and interest rates reflect the impact of the related derivative contracts, presented in Note 20. 

²Foreign currency denominated debt as at March 31, 2023 includes USD$1,351 million (CAD$1,773 million), of which USD$1,124 million was fully hedged to CAD$1,466 million and USD$227 million was unhedged (CAD$307 million), and 402 million EURO was fully hedged to CAD$591 million.

³The foreign currency denominated debt adjustment to exchange rates as at March 31, 2023, includes USD$1,351 million converted to CAD$1,828 million; and 402 million EURO converted to CAD$592 million. 

Notes, bonds and debentures

Redeemable by the province 

Balances include debentures issued to the Canada Pension Plan totalling $223 million (2022: $223 million) at a weighted average interest rate of 3.34% (2022: 3.34%). These debentures mature at various dates from May 8, 2042 to July 10, 2042, with interest rates varying between 3.22% and 3.54%. These debentures are redeemable in whole or in part before maturity, on thirty days prior notice, at the option of the province. During the year, no Canada Pension Plan debentures were issued (2022: nil).

PROVINCE OF BRITISH COLUMBIA 73

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

19. Self–supported Debt—Continued

Aggregate payments to meet retirement provisions 

Aggregate payments for the next five fiscal years and thereafter to meet retirement provisions on notes, bonds and debentures are:

	In Millions
	$
2024		200
2025		0
2026		1,939
2027		850
2028		1,000
2029–2063		21,477
Total of stated minimum payments		25,466

20. Risk Management and Derivative Financial Instruments

The province borrows funds in both domestic and foreign capital markets, and manages its existing debt portfolio to achieve the lowest debt costs within specified risk parameters. As a result, the province is exposed to risks associated with fluctuations in interest rates, foreign exchange rates, and credit risk. In accordance with the risk management policy guidelines set by the Risk Committee of the Ministry of Finance, the province uses a variety of derivative financial instruments to hedge the exposure to these risks.

Debt at amortized cost includes the impacts of the related derivative contracts. Derivatives used by the province include interest rate swaps, cross–currency swaps, and forward foreign exchange contracts. A derivative instrument is a financial contract with a counterparty that is applied to hedge against interest rate or foreign exchange exposure that exists in the underlying provincial debt instrument. A derivative derives value from the impact of market changes on the underlying hedged debt instrument. The fair value of derivatives is reported in the statement of financial position and in the statement of remeasurement gains and losses, as detailed in the following table.

Derivative Financial Instruments (Market Values)

	In Millions
	2023
	$
Taxpayer–supported derivative assets		419
Self–supported derivative assets		244
Derivative assets		663
Taxpayer–supported derivative liabilities		(972	)
Self–supported derivative liabilities		(59	)
Derivative liabilities		(1,031	)
Total derivative financial instruments		(368	)

74 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

20. Risk Management and Derivative Financial Instruments—Continued

The following tables present maturity schedules of the province’s derivatives, based on the notional amounts of the contracts. Cross–currency swaps can have an exchange of the notional amounts at the start of the contract, the end of the contract, or both. There is no exchange of the notional amounts in interest rate swaps.

Taxpayer–supported Portfolios (Notional Values)

	In Millions
	Year of Maturity		Cross– Currency Swaps1		Interest Rate Swaps1		Forward Foreign Exchange Contracts1		Total
				$		$		$	$
		2024		41		132		1,267	1,440
		2025		2,375		2			2,377
		2026		350		100			450
		2027		4,280		321			4,601
		2028				103			103
		2029–2033		2,616		472			3,088
		2034–2038		209		127			336
		2039–2043		502		100			602
		2044–2048		340		200			540
		2049–2053		1,245		400			1,645
		2054–2058				78			78
Total				11,958		2,035		1,267	15,260

¹At March 31, 2023, fair market valuation was an unrealized loss of $512 million (2022: $117 million loss) on cross–currency swaps, and an unrealized loss of $40 million (2022: $117 million gain) on interest rate swaps, and an unrealized loss of $1 million (2022: $15 million loss) on forward foreign exchange contracts. These unrealized gains and losses are incurred on derivatives held in matched hedging arrangements with related debt instruments. The unrealized gains or losses on these hedging derivatives are offset by corresponding unrealized gains or losses on the matched debt instruments. These gains and losses are subject to measurement uncertainty.

PROVINCE OF BRITISH COLUMBIA 75

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

20. Risk Management and Derivative Financial Instruments—Continued

Self–supported Portfolios (Notional Values)

	In Millions
	Year of Maturity		Cross– Currency Swaps2		Interest Rate Swaps2		Forward Foreign Exchange Contracts2		Total
				$		$		$		$
		2024						747		747
		2025								0
		2026		391				436		827
		2027								0
		2028								0
		2029–2033		200						200
		2034–2038				1,325		283		1,608
		2039–2043								0
		2044–2048								0
		2049–2053								0
		2054–2058				1,550				1,550
Total				591		2,875		1,466		4,932

²At March 31, 2023, fair market valuation was an unrealized loss of $31 million (2022: $27 million loss) on cross currency swaps, an unrealized gain of $184 million (2022: $130 million gain) on interest rate swaps, no unrealized gain or loss (2022: $50 million gain) on advanced rate setting agreements, and an unrealized gain of $33 million (2022: $6 million gain) on forward foreign exchange contracts. These unrealized gains and losses are incurred on derivatives held in matched hedging arrangements with related debt instruments that are held to maturity. The unrealized gains or losses on these hedging derivatives are offset by corresponding unrealized gains or losses on the matched debt instruments. These gains and losses are subject to measurement uncertainty.

76 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

20. Risk Management and Derivative Financial Instruments—Continued

Undiscounted Cashflows for Derivative Instruments¹

In Millions
Year of Maturity	Cross– Currency Swaps Principal Outflows			Cross– Currency Swaps Principal Inflows		Cross– Currency Swaps Interest Outflows			Cross– Currency Swaps Interest Inflows		Interest Rate Swaps Interest Outflows			Interest Rate Swaps Interest Inflows		Forward Foreign Exchange Contracts Principal Outflows			Forward Foreign Exchange Contracts Principal Inflows
		$			$		$			$		$			$		$			$
2024		(41	)		37		(290	)		185		(96	)		72		(2,014	)		2,012
2025		(2,375	)		2,326		(264	)		171		(72	)		65
2026		(741	)		735		(211	)		129		(53	)		64		(436	)		464
2027		(4,280	)		4,552		(157	)		95		(43	)		60
2028							(120	)		65		(36	)		57
2029–2033		(2,816	)		3,018		(539	)		255		(160	)		170
2034–2038		(209	)		221		(371	)		118		(149	)		105		(283	)		311
2039–2043		(502	)		515		(292	)		80		(124	)		75
2044–2048		(340	)		338		(186	)		46		(72	)		58
2049–2053		(1,245	)		1,221		(51	)		13		(5	)		5
Total		(12,549	)		12,963		(2,481	)		1,157		(810	)		731		(2,733	)		2,787

¹Undiscounted cash inflows and outflows of the Province’s cross currency swaps, interest rate swaps, and forward foreign exchange contracts. Future foreign payments paid or received are converted to Canadian dollars using the March 31, 2023 foreign exchange rates.

Interest rate risk 

Interest rate risk is the risk that the province’s debt servicing costs will fluctuate due to changes in interest rates. The province uses derivative contracts (interest rate swaps) to manage interest rate risk by exchanging a series of interest payments and assuming either a fixed or floating rate liability to a counterparty, based on the notional principal amount. Derivatives allow the province to alter the proportion of its debt held in fixed and floating rate form to take advantage of changes in interest rates.

The government’s current policy guidelines with respect to the provincial government direct debt portfolio, which totals $36,751 million (2022: $43,533 million), allow floating rate exposure up to 45.00% (2022: 45.00%) of this portion of the taxpayer–supported debt. At March 31, 2023, floating rate debt exposure was 14.23% (2022: 16.08%) of the government direct debt portfolio.

Under current policy guidelines for British Columbia Hydro and Power Authority (BC Hydro), the maximum floating rate exposure is 25.00% (2022: 25.00%) of their debt which totals $26,667 million (2022: $25,569 million). At March 31, 2023, floating rate debt exposure for BC Hydro was 10.80% (2022: 12.70%) of their debt.

Based on the taxpayer–supported and self–supported debt portfolios at March 31, 2023, a one percent change in interest rates would impact the annual debt servicing expense by $68 million (2022: $87 million) for the taxpayer–supported debt portfolio and $29 million (2022: $29 million) for the self–supported debt portfolio.

At March 31, 2023, swap agreements relating to investments held by taxpayer–supported portfolios included interest rate swaps totalling $44 million (2022: $44 million).

PROVINCE OF BRITISH COLUMBIA 77

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

20. Risk Management and Derivative Financial Instruments—Continued

Foreign exchange risk 

Foreign exchange risk is the risk that the province’s debt servicing costs and principal payments will fluctuate due to changes in foreign exchange rates. The province uses derivative contracts (cross–currency swaps) to hedge foreign exchange risk by converting foreign currency principal and interest cash flows into Canadian dollar cash flows.

The government’s current policy guidelines with respect to the provincial government direct debt portfolio, which totals $36,751 million (2022: $43,533 million), allow unhedged foreign debt exposure up to 10.00% (2022: 10.00%) of this portion of the taxpayer–supported debt. At March 31, 2023, there was no unhedged foreign debt exposure of the government direct debt portfolio (2022: nil).

Under current policy guidelines for BC Hydro, the maximum unhedged foreign debt exposure is 5.00% (2022: 5.00%) of its debt, which totals $26,667 million (2022: $25,569 million). At March 31, 2023, 0.00% (2022: 0.00%) of its debt was in the form of unhedged foreign debt in US dollars.

Based on the taxpayer–supported and self–supported debt portfolios at March 31, 2023, a one cent change in the Canadian dollar versus the US dollar would not impact the annual debt servicing cost (2022: nil) for the taxpayer–supported debt portfolio; however, the self–supported debt portfolio would increase by $2 million (2022: $2 million).

At March 31, 2023, swap agreements relating to investments held by taxpayer–supported portfolios included cross–currency swaps totalling $37 million (2022: $34 million).

Credit risk 

Credit risk is the risk that the province will incur financial losses due to a counterparty defaulting on its financial obligations. In accordance with the government’s policy guidelines, the province reduces its credit risk by dealing with only highly rated counterparties. The province only enters into derivative transactions with counterparties that have a rating from Standard & Poor’s or Moody’s Investors Service Inc. of at least A+/A1. The province also establishes limits on individual counterparty credit exposures and monitors these exposures on a regular basis.

The province implements Credit Support Annex agreements for all derivative type transactions, including cross–currency and interest rate swaps, to mitigate exposure to counterparty default risk. Under the terms of these agreements, the province may be required to pledge or receive eligible collateral with its counterparties. These amounts will be returned to or received from the counterparties when there are no longer any outstanding obligations. As at March 31, 2023, gross counterparty exposure was valued at $(365) million (2022: $154 million), and collateral held was $83 million (2022: $529 million held), with a $2 million net counterparty exposure (2022: nil). Collateral held consists of $351 million net cash paid which is included in accounts receivable (see Note 12) (2022: $104 million cash received), and $434 million (2022: $425 million) of securities received, which have not been recognized in the financial statements as it is pledged by counterparties and held by a third party until the derivative transaction is completed or default occurs.

Liquidity Risk 

The province utilizes a cash management framework to ensure that cash is available where and when it is needed while minimizing the cost of cash and maximizing returns on temporary balances. The province forecasts all cash inflows and outflows, including debt and the related derivatives maturities, for the full current fiscal year and the following two fiscal years. The forecast is for each business day and is revised daily based on actual flows, analysis of current trends, historical patterns, and emerging market conditions.

Market Price Risk 

The province is committed to generating long–term investment returns that meet or exceed targets and benchmarks without unnecessary risk. The province is exposed to market price risk on its portfolio investments, and utilizes strategies such as diversification and the selection of only high–quality investment assets to mitigate this exposure.

78 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

21. Net Liabilities

The Consolidated Statement of Change in Net Liabilities (see page 45) shows the net impact of applying the expenditure basis of accounting. The net liabilities calculation uses the expenditure, rather than the expense basis of accounting. Under the expenditure basis of accounting, tangible capital assets, prepaid program costs and other assets are recorded as expenditures when calculating the current year surplus or deficit. Under the expense basis of accounting, these items are recorded on the Consolidated Statement of Financial Position as assets and amortized over an applicable period of time.

22. Tangible Capital Assets

	In Millions
	2023		2022
	$		$
Land and land improvements		6,220		6,129
Buildings (including tenant improvements)		30,232		28,106
Highway infrastructure		15,099		14,267
Transportation equipment		3,507		3,120
Computer hardware and software		2,299		2,191
Other		2,454		2,320
		59,811		56,133

See Consolidated Statement of Tangible Capital Assets on page 108.

The estimated useful lives of the more common tangible capital assets are: buildings (3–90 years); highway infrastructure (3–90 years); transportation equipment (including rapid transit, ferries and related infrastructure) (15–100 years); computer hardware and software (1–18 years); major software systems (1–18 years); and other (including vehicles, specialized equipment, and furniture and equipment) (1–30 years). Land improvements are amortized over 30 years (recreation areas) or 40 years (dams and water management systems). Leasehold improvements (2–40 years) are amortized over the lesser of the lease term and the life of the asset.

BC Transportation Financing Authority (BCTFA) assets include capital assets under lease to South Coast British Columbia Transportation Authority (SCBCTA). These capital assets under lease consist of land, land improvements, interests in land, park and ride facilities, stations, guideways, rolling stocks and other assets related to the SkyTrain system, including the Millennium Line, Evergreen Line, the Expo Line SkyTrain systems and the West Coast Express. These assets are made available for use by SCBCTA under operating lease arrangements for a nominal lease amount pursuant to an Order in Council and to the Millennium Line Use Agreement, and represent one of the province’s contributions toward public transportation in the Metro Vancouver service area. The Expo Line and Millennium Line Use Agreements expire in January 2024 and may be renewed, if mutually agreed, for successive five year terms as long as the assets remain a part of the Greater Vancouver regional transportation system. The net book value of these assets is $2,215 million (2022: $2,266 million).

The province received donations of tangible capital assets during the year of $29 million (2022: $3 million).

PROVINCE OF BRITISH COLUMBIA 79

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

23. Restricted Assets

	In Millions
	2023		2022
	$		$
Endowment funds		2,224		2,147

Donors have placed restrictions on their contributions to the endowment funds of universities, colleges, school districts, health organizations, and taxpayer–supported Crown corporations. One restriction is that the original contribution should not be spent. Endowment agreements may also require that a portion of investment income be used to offset the eroding effect of inflation or preserve the original value.

24. Prepaid Program Costs

	In Millions
	2023		2022
	$		$
Prepaid program costs		1,104		1,347

The prepaid program costs include deferred costs associated with the BC Timber Sales Program, prepaid operating costs and inventories of supplies and other not–for–resale items held by taxpayer–supported Crown corporations and agencies which are charged to expense when consumed in the normal course of operations. At March 31, 2023, the total inventories held for use or consumption was $522 million (2022: $800 million). During the year, the total expense due to the consumption of inventories was $2,187 million (2022: $1,626 million) including the effect of write–downs of $168 million (2022: $10 million).

25. Other Assets

	In Millions
	2023		2022
	$		$
Deferred debt instrument costs				137
Other deferred costs		243		307
		243		444

Other deferred costs include funds held by a service provider to provide group health and welfare benefits on behalf of health authorities, affiliates and community social service organizations.

80 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

26. Accumulated Surplus (Deficit)

	In Millions
	2023			2022
	$			$
Accumulated surplus (deficit)—before remeasurement gains and losses—beginning of year as previously reported1		3,759			2,453
Adjustments to accumulated surplus (deficit)2,3		(1,558	)		(1,507	)
Accumulated surplus (deficit)—beginning of year as restated		2,201			946
Surplus (deficit) for the year		704			1,265
Accumulated surplus (deficit)—before remeasurement gains and losses		2,905			2,211
Effect of remeasurement gains and (losses)		(202	)		396
Accumulated surplus (deficit)—end of year		2,703			2,607

1  The opening accumulated surplus (deficit) figures for April 1, 2022 and April 1, 2021 are reported before remeasurement gains and losses.
2  During 2022/23, adjustments were made to the opening accumulated surplus for 2021/22 for the following items:
Adoption of the asset retirement obligations accounting standard during fiscal 2023	(1,507	)
Total	(1,507	)
3  During 2022/23, adjustments were made to the opening accumulated surplus for 2022/23 for the following items:
Adoption of the asset retirement obligations accounting standard during fiscal 2023	(1,548	)
Adjustments to opening equity for the adoption of the financial instruments accounting standard during fiscal 2023	(10	)
Total	(1,558	)

PROVINCE OF BRITISH COLUMBIA 81

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

27. Contingent Assets and Contractual Rights

(a) UNRECOGNIZED ASSETS 

Intangible assets and items inherited by right of Crown, such as forest, water and mineral resources, are not recognized in these financial statements. Land inherited by the right of Crown is capitalized at a nominal value of one dollar. The value of collections (e.g. artifacts, specimens, works of art, and documents) has been excluded from the Statement of Financial Position. When collections are purchased, these items are expensed.

(b) CONTINGENT ASSETS 

The province has no contingent assets where the estimated amount is, or exceeds $100,000, and the occurrence of the confirming future event is likely.

(c) CONTRACTUAL RIGHTS 

Contractual rights are future–oriented financial information based on multi–year contracts the government has entered into that will become assets and revenue when terms of the contracts are met. The following table presents contractual rights that are greater than $50 million, by sector, by year.

	In Millions
	2024		2025		2026		2027		2028		2029 and beyond		Total
	$		$		$		$		$		$		$
Consolidated Revenue Fund and Taxpayer–supported Crown corporations and agencies
Health		1		1		1								3
Education		38		23		19		18		15		17		130
Social services		729		842		911								2,482
Natural resources and economic development		193		186		184		182		162		4,851		5,758
Transportation		425		377		258		54		43		1,210		2,367
General government		413		392		482		467		443		2,595		4,792
		1,799		1,821		1,855		721		663		8,673		15,532
Self–supported Crown corporations and agencies
Natural resources and economic development		461		317		291		260		221		4,444		5,994
Protection of persons and property		22		18		15		13		8		22		98
		483		335		306		273		229		4,466		6,092
Total		2,282		2,156		2,161		994		892		13,139		21,624

82 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

27. Contingent Assets and Contractual Rights—Continued

The following table presents amounts provided in multi-year government transfer agreements that are greater than $50 million, by sector, by year. These government transfers may be authorized by the federal government in the future.

	In Millions
	2024		2025		2026		2027		2028		2029 and beyond		Total
	$		$		$		$		$		$		$
Consolidated Revenue Fund and Taxpayer–supported Crown corporations and agencies
Education		98												98
Social services		388		45		45								478
Other		149		153		52		37		23		27		441
Natural resources and economic
development		18		17		17		17		17				86
Total		653		215		114		54		40		27		1,103

28. Contingent Liabilities and Contractual Obligations

(a) GUARANTEED DEBT 

The authorized limit for loans guaranteed by the province as at March 31, 2023 was $398 million (2022: $398 million). These guarantees include amounts where indemnities have been made for explicit quantifiable loans. Guaranteed debt as at March 31, 2023 totalled $15 million (2022: $16 million). See Consolidated Statement of Guaranteed Debt on page 109 for details.

(b) CONTINGENT LIABILITIES

Litigation 

The province is a defendant in legal actions and is involved in matters such as expropriation, contract and tax disputes. These matters may give rise to future liabilities.

The province has the following contingent liabilities where the estimated or known claim is, or exceeds $100,000, but the likelihood of payment is uncertain.

	In Millions
	2023		2022
	$		$
Tax disputes		64		49
Property access disputes		30		27
Contract disputes		33		16
Damage to persons or property		3		2
Negligence and miscellaneous		1,794		345
		1,924		439

When it is determined it is likely a liability exists and the amount can be reasonably estimated, the amount is recorded as an accrued liability (see Note 12) and an expense. The accrued liability for pending litigation in process at March 31, 2023 was $117 million (2022: $116 million).

PROVINCE OF BRITISH COLUMBIA 83

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

28. Contingent Liabilities and Contractual Obligations—Continued

Tax Appeals 

The province has received appeals under various tax statutes totalling $201 million (2022: $147 million). The cost to the province cannot be determined as the outcome of these appeals is uncertain.

Guarantees and Indemnities 

The province also has contingent liabilities in the form of indemnities, indirect guarantees and outstanding claims for amounts that are not explicit or reasonably estimable at this time.

Environmental Clean–up 

The province is responsible for the remediation of numerous contaminated sites in the province that are no longer in productive economic use.

For sites where the province is directly responsible or has assumed responsibility for remediation, the following provision for future clean–up costs has been accrued based on preliminary environmental assessments, or estimations for those sites where an assessment has not been conducted. The provision is recorded as an accrued liability (see Note 12).

	In Millions
	2023		2022
	$		$
Mine sites		348		350
Transportation infrastructure		33		33
Industrial sites		25		26
Salt sheds		5		5
Maintenance yards		5		3
Pulp mills		1		4
Miscellaneous		96		101
		513		522

This provision for future clean–up costs is an estimate of the minimum remediation costs for known sites where an assessment has been conducted, or where available information on sites is sufficient to estimate the costs. Where information is not available to make an estimate, costs are extrapolated from the estimated costs of similar sites. The undiscounted estimated costs for sites that require ongoing remediation, monitoring or maintenance is $124 million. Where settlement dates are known, these costs are discounted using the province’s estimated weighted average cost of capital at periodic evaluation dates. As at March 31, 2023, the weighted average cost of capital is 3.47% (2022: 3.13%).

As at the reporting date, 27 sites where historical industrial activity has occurred have been identified for monitoring purposes. Remediation activities are unlikely to be performed on these sites and a liability may be recorded at a later date.

Additional environmental liabilities of government business enterprises include $270 million (2022: $296 million) accrued by British Columbia Hydro and Power Authority, and $10 million (2022: $96 million) accrued by British Columbia Railway Company. The liabilities are included in the investment balance of the Crown corporation or agency in Note 7.

84 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

28. Contingent Liabilities and Contractual Obligations—Continued

Treaty Negotiations 

Treaty negotiations between the province, Canada and First Nations commenced in 1994. The province anticipates these negotiations will result in modern–day treaties defining the boundaries and nature of First Nations treaty settlement lands. As of March 31, 2023, there were 73 First Nations in various stages of negotiation, including 39 First Nations in active or completed negotiations.

When final treaty agreements are ratified by all parties, the provincial cost of treaties is recorded in the Public Accounts. Costs are accounted for based on the substance of the final agreement.

A Final Agreement with Yale First Nation was ratified by Yale First Nation in March 2011, by the provincial government on June 2, 2011 and by the Parliament of Canada on June 19, 2013. A treaty effective date has not yet been agreed to by the parties. Through the treaty, the province will provide Yale with a capital transfer of $2.5 million, economic development funding of $1.1 million and 1,179 hectares of provincial Crown lands.

It is expected the capital transfer components for all treaty agreements will be, in most cases, entirely provided by Canada. The current commitments of provincial Crown land for all Final Agreement and Increment Treaty Agreement tables are as follows:

● Ditidaht, 3,567 hectares

● Homalco, 822 hectares

● In–SHUCK–ch, (Skatin and Samahquam) 9,474 hectares

● Kaska Dena Council, 677 hectares

● Kitselas, 34,839 hectares

● Kitsumkalum, 44,661 hectares

● K’omoks, 3,040 hectares

● Ktunaxa Nation Council, 418 hectares

● Lake Babine Nation (BC only), 511 hectares with a one–time payment of $0.02 million

● Lheidli T’enneh, 3,416 hectares

● Nazko, 172 hectares

● NStQ (Canoe Creek, Sugar Cane, Canim Lake, Soda Creek), 3,656 hectares

● Pacheedaht, 1,216 hectares

● Te’mexw (Malahat, Scia’new, Snaw–naw–as, Songhees and T’Sou–ke), 1,182 hectares

● Tla–o–qui–aht, 47 hectares

● Wei Wai Kai (Cape Mudge First Nation), 3,100 hectares

● Wei Wai Kum (Campbell River First Nation) 2,276 hectares

● Wuikinuxv, 13,946 hectares

● Yekooche, 5,960 hectares

Upon coming into effect, treaties and other incremental agreements will also trigger implementation costs and may result in compensation to third parties. Those costs are not determinable at this time.

Some First Nations have chosen not to negotiate through the formal British Columbia Treaty Commission process. A number of those First Nations have chosen to advance their claims through litigation. Claims include declarations with respect to aboriginal rights and title, commercial rights, challenges with respect to adequacy of consultation and accommodation, and damages for unjustified infringements. The amount of any provincial liability is not determinable at this time.

PROVINCE OF BRITISH COLUMBIA 85

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

28. Contingent Liabilities and Contractual Obligations—Continued

Crown Corporations, Agencies and School Districts, Universities, Colleges, Institutes and Health Organizations (SUCH)

(i) The BC Transportation Financing Authority has unrecorded contingent liabilities of $67 million (2022: $103 million), including $18 million (2022: $17 million) for expropriation claims and $27 million (2022: $27 million) for contaminated sites.

(ii) The B.C. Pavilion Corporation and predecessor property owners remain liable for environmental and reclamation obligations for known hazards that may exist at its facilities. Management is not aware of any existing environmental problems related to its facilities that may result in a material liability to the B.C. Pavilion Corporation.

(c) CONTRACTUAL OBLIGATIONS 

The government has entered into a number of multiple–year contracts for the delivery of services and the construction of assets. These contractual obligations will become liabilities in the future when the terms of the contracts are met. Disclosure relates to the unperformed portion of the contracts. Contractual obligations are future–oriented financial information about non–discounted future cash payments for operating and capital contracts, and do not indicate when the related expenses will be recognized in the financial statements.

The following table presents the minimum amounts required to satisfy the contractual obligations, for contractual obligations that are greater than $50 million, by sector, by year. Details are available as unaudited supplementary information on the public website at http://gov.bc.ca/publicaccounts.

	In Millions
	2024		2025		2026		2027		2028		2029 and beyond		Total
	$		$		$		$		$		$		$
Consolidated Revenue Fund and Taxpayer–supported Crown corporations and agencies
Health		4,600		2,415		1,764		1,128		908		5,331		16,146
Education		1,003		471		215		100		50		153		1,992
Social services		136												136
Other		411		330		251		191		162		4,110		5,455
Natural resources and economic development		45		34		35		38		63		203		418
Transportation		2,344		1,584		1,090		870		831		9,723		16,442
Protection of persons and property		577		553		528		529		514		2,279		4,980
General government		557		489		158		134		114		283		1,735
		9,673		5,876		4,041		2,990		2,642		22,082		47,304
Self–supported Crown  corporations and agencies
Natural resources and economic development		3,709		3,183		2,398		2,244		2,179		39,886		53,599
General government		163		73		19		1		1				257
		3,872		3,256		2,417		2,245		2,180		39,886		53,856
Total		13,545		9,132		6,458		5,235		4,822		61,968		101,160

86 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

28. Contingent Liabilities and Contractual Obligations—Continued

The following table presents the amounts provided in multiple–year government transfer agreements that are greater than $50 million, by sector, by year. While there is no current obligation for these amounts, these government transfers may be authorized by government in a future year.

	In Millions
	2024		2025		2026		2027		2028		2029 and beyond		Total
	$		$		$		$		$		$		$
Consolidated Revenue Fund and Taxpayer–supported Crown corporations and agencies
Education		96		87		68								251
Social services		472		13										485
Other		54		55		56		57		60		444		726
Natural resources and economic
development		580		194		397								1,171
Total		1,202		349		521		57		60		444		2,633

29.Taxation Revenue

	In Millions
	2023		2022
	$		$
Personal income		17,268		13,704
Provincial sales		9,818		8,731
Corporate income		9,156		5,053
Property		3,253		3,012
Employer health		2,720		2,443
Property transfer		2,293		3,327
Carbon		2,161		2,011
Fuel		1,021		1,022
Tobacco		531		708
Other		804		706
		49,025		40,717

Personal income tax and corporate income tax revenues are recorded after deductions for non–refundable tax credits. Deductions allowable in the calculation of personal income tax revenue were $176 million (2022: $110 million) and corporate income tax were $232 million (2022: $127 million). The types of tax credits adjusting personal income tax and corporation income tax revenues are for foreign taxes, logging taxes, venture capital, scientific and experimental development tax, and mining flow–through share.

Personal income tax revenue was also reduced by $199 million (2022: $191 million) for the BC Tax Reduction.

Personal and corporate income tax refunds related to prior years may be issued under the International Business Activity Act. Corporate income tax reimbursements were $3 million (2022: $10 million).

Property tax revenue was recorded net of home owner grants of $892 million (2022: $878 million).

PROVINCE OF BRITISH COLUMBIA 87

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

30. Natural Resource Revenue

	In Millions
	2023		2022
	$		$
Petroleum, natural gas and minerals		3,356		1,848
Forests		1,887		1,893
Water and other		955		730
		6,198		4,471

Oil and gas royalty revenues are reported after adjustments for various royalty deduction programs such as producer cost of service allowances, deep well, marginal, ultra marginal, low production, net profit, new pool discovery and road construction. Deductions allowable in the calculation of royalty revenue were $1,671 million (2022: $1,517 million). Natural resource revenue includes mining taxes of $801 million (2022: $660 million) and logging taxes of $403 million (2022: $154 million).

The province offers credits for certain costs incurred by producers including the deep well, road and summer drilling programs. Deep well credits of $2,215 million (2022: $2,838 million), road credits of $10 million (2022: $14 million) and summer drilling credits of $3 million (2022: $3 million) have been incurred by producers and will reduce future natural gas royalties payable when wells go into production.

31. Expense

	In Millions
	2023		2022
	$		$
Total Expense by Group Account Classification
Government transfers		28,246		22,425
Salaries and benefits		28,214		26,124
Operating costs		17,595		16,340
Amortization		2,926		2,681
Interest1		2,719		2,742
Other		1,132		815
		80,832		71,127

¹Total interest function costs include a $79 million net loss (2022: $25 million net gain) related to cross currency and interest rate derivatives.

88 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

32. Valuation Allowances

	In Millions
	2023		2022
	$		$
Inventory held for use		167		10
Accounts receivable		88		84
Loans, advances and mortgages receivable		42		15
Tangible capital assets		8		9
		305		118

These amounts are included in “Other” of “Total Expense by Group Account Classification” in Note 31, and represent the write–down of assets in the above Consolidated Statement of Financial Position categories.

33. Trusts Under Administration

Trusts Under Administration are not included in the Summary Financial Statements because the province has no equity in, or power of appropriation over, these trusts. The province administers these trusts on behalf of third parties according to the terms of the underlying trust arrangements. The trust assets consist of cash, term deposits, investments, real estate, and other sundry assets. Trust liabilities consist of trade payables, loans payable, and mortgages payable. Summary financial information from the financial statements of trust funds is provided below.

	In Millions
	Assets		Liabilities			2023		2022
	$		$			$		$
Public Guardian and Trustee of British Columbia1 —administered by government officials		1,410		(47	)		1,363		1,265
Credit Union Deposit Insurance Corporation of British Columbia1 —administered by various government officials and a non–government investment corporation		861		(2	)		859		810
Supreme and provincial court (Suitors’ Funds) —administered by the Courts		213					213		223
Other trust funds —administered by various government officials		252		(62	)		190		144
		2,736		(111	)		2,625		2,442

¹These organizations are reported under International Financial Reporting Standards.

34. Comparison to Estimates

The Estimates numbers on the Statement of Operations are taken from the Estimated Statement of Operations, the Estimated Revenue by Source, and the Estimated Expense by Function, on pages 4 – 6 of the Estimates, Fiscal Year Ending March 31, 2023, presented to the Legislative Assembly February 22, 2022.

35. Comparatives

Comparative figures have been restated to conform with the current year’s presentation. The effect of restatements on the previously reported operating result is disclosed in Note 26.

PROVINCE OF BRITISH COLUMBIA 89

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

36. Asset Retirement Obligations

Asset retirement obligations recognized by the province include estimated costs for which there is a legal obligation to conduct activities associated with the retirement of tangible capital assets. Activities may include remediation of hazardous materials such as asbestos in buildings and the decommissioning or restoration of assets such as land or leaseholds to their original use and condition. The following table summarizes the changes to the province’s asset retirement obligations during the year:

	In Millions
	Balance– beginning of year		New liabilities in the year		Accretion expense in the year		Changes in estimate1			Liabilities settled in the year			2023		2022
		$		$		$		$			$			$	$
Consolidated Revenue Fund and Taxpayer–supported Crown corporations and agencies
Health		335		2		12								349	335
Education		719		2		4		82						807	719
Other		248		10		17								275	248
Natural Resources and Economic Development		36		7		1					(3	)		41	36
Protection of Persons and Property				1										1
Transportation		244		3										247	244
General Government		135				4		11						150	135
		1,717		25		38		93			(3	)		1,870	1,717
Self–supported Crown corporations and agencies
Natural Resources and Economic
Development		80				2		(5	)		(7	)		70	80
Transportation		191				5		(21	)					175	191
General Government		1						2						3	1
		272		0		7		(24	)		(7	)		248	272
		1,989		25		45		69			(10	)		2,118	1,989

The estimated undiscounted cash flows required to settle these obligations are $2,103 million. Those with legally stipulated settlement dates are expected to be settled between 2023 and 2083. The timing of settlement for all other obligations is dependent on the use of the underlying assets. Where the settlement date is known, estimated future costs are discounted using the province’s estimated weighted average cost of capital at periodic evaluation dates. As at March 31, 2023, the weighted average cost of capital is 3.47% (2022: 3.13%).

Self–supported Crown corporations’ balances are calculated using International Financial Reporting Standards.

¹Can include changes in the estimated cost, timing of settlement and the discount of the current value of the obligation.

90 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

37. Government Partnerships

Canadian Blood Services owns and operates the national blood supply system for Canada, except for the province of Quebec. It is a government partnership amongst Canadian provinces and territories. The ministers of health for the provinces and territories, except Quebec, provide contributions to fund its operations. Its financial results are proportionately consolidated with those of the province based upon the province’s share of its total provincial contributions (14.67%). The amounts included in these financial statements are as follows:

Consolidated Statement of Financial Position	In Millions
	2023			2022
	$			$
Financial assets		101			99
Liabilities		131			128
Net liabilities		(30	)		(29	)
Non–financial assets		81			79
Accumulated surplus (deficit)		51			50

Consolidated Statement of Operations	In Millions
	2023		2022
	$		$
Revenue		202		197
Expenses		201		190
Surplus (deficit) for the year		1		7
Accumulated surplus (deficit) beginning of year		50		43
Accumulated surplus (deficit) end of year		51		50

38. Regulatory Accounting

Included in the Summary Financial Statements are entities that are regulated by the independent British Columbia Utilities Commission (the Commission). The Commission is responsible for regulating utilities in British Columbia which includes establishing tariffs, approving the construction of new facilities planned by utilities, and their issuance of securities. As an independent provincial agency, the operating results of the Commission are also included in the Summary Financial Statements.

Rate–regulation can result in the deferral and amortization of costs and recoveries to allow for adjustment of future rates. In the absence of rate–regulation, these amounts would otherwise be included in the determination of net income in the year the amounts are incurred. BC Hydro had unamortized net regulatory assets at the end of March 31, 2023 of $1,467 million (2022: $2,911 million). Regulatory accounting resulted in a decrease to net income for BC Hydro for the year ended March 31, 2023 of $1,162 million (2022: $608 million decrease). Further details are available in BC Hydro’s financial statements outside these audited financial statements at http://gov.bc.ca/financepublications.

PROVINCE OF BRITISH COLUMBIA 91

PUBLIC ACCOUNTS 2022/23

Notes to Consolidated Summary Financial Statements

for the Fiscal Year Ended March 31, 2023—Continued

39. Dedicated Revenue

Legislation establishes the right of other governments and organizations to revenues under various enactments. The province acts as an administrative agent for revenues collected on behalf of, and transferred to, other governments and organizations. These revenues are not included in the provincial operating results because the province has no discretion to direct the use of, or cease, the flow–through.

	In Millions
	2023		2022
	$		$
Rural areas		457		423
South Coast British Columbia Transportation Authority		400		400
Municipalities or eligible entities		118		63
British Columbia First Nations Gaming Revenue Sharing Limited Partnership		114		91
Habitat Conservation Trust		6		5
Cowichan Tribes		4		4
		1,099		986

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA 93

PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the

Consolidated Summary Financial Statements

Reporting Entity

for the Fiscal Year Ended March 31, 2023

TAXPAYER–SUPPORTED CROWN CORPORATIONS AND AGENCIES

(GOVERNMENT ORGANIZATIONS)

RECORDED ON A CONSOLIDATED BASIS

Consolidated Revenue Fund¹

Health Sector

BC Health Care Occupational Health and Safety Society

Canadian Blood Services²

Fraser Health Authority

Interior Health Authority

Louis Brier Home and Hospital

Menno Hospital

Mount St. Mary Hospital

Nisga’a Valley Health Authority

Northern Health Authority

Providence Health Care Society

Provincial Health Services Authority

St Michael’s Centre

Vancouver Coastal Health Authority

Vancouver Island Health Authority

Education Sector

BCNET

British Columbia Institute of Technology

Camosun College

Capilano University

Coast Mountain College

College of New Caledonia

College of the Rockies

Douglas College

Emily Carr University of Art & Design

Justice Institute of British Columbia

Knowledge Network Corporation

Kwantlen Polytechnic University

Langara College

Nicola Valley Institute of Technology

North Island College

Northern Lights College

Okanagan College

94 PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the

Consolidated Summary Financial Statements

Reporting Entity

for the Fiscal Year Ended March 31, 2023—Continued 

TAXPAYER–SUPPORTED CROWN CORPORATIONS AND AGENCIES 

(GOVERNMENT ORGANIZATIONS) 

RECORDED ON A CONSOLIDATED BASIS

Education Sector—Continued

Royal Roads University

School Districts

Selkirk College

Simon Fraser University

SkilledTradesBC³

The British Columbia Council for International Education

The University of British Columbia

Thompson Rivers University

University of the Fraser Valley

University of Northern British Columbia

University of Victoria

Vancouver Community College

Vancouver Island University

Natural Resources and Economic Development Sector

BC Infrastructure Benefits Inc.

B.C. Pavilion Corporation

British Columbia Energy Regulator³

British Columbia Enterprise Corporation⁴

Columbia Basin Trust

Creston Valley Wildlife Management Authority Trust Fund

Destination BC Corp.

Forest Enhancement Society of BC

Forestry Innovation Investment Ltd

InBC Investment Corp.

Infrastructure BC Inc.

Innovate BC

Nechako–Kitamaat Development Fund Society

Transportation Sector

BC Transportation Financing Authority

British Columbia Transit

Protection of Persons and Property Sector

BC Family Maintenance Agency Ltd.

BC Financial Services Authority

British Columbia Securities Commission

Organized Crime Agency of British Columbia Society

Real Estate Foundation of British Columbia⁵

PROVINCE OF BRITISH COLUMBIA 95

PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the

Consolidated Summary Financial Statements

Reporting Entity

for the Fiscal Year Ended March 31, 2023—Continued

TAXPAYER–SUPPORTED CROWN CORPORATIONS AND AGENCIES

(GOVERNMENT ORGANIZATIONS)

RECORDED ON A CONSOLIDATED BASIS

Social Services Sector

Community Living British Columbia

Legal Services Society

Other Sector

BC Games Society

British Columbia Assessment Authority

British Columbia Housing Management Commission

British Columbia Public School Employers’ Association

Community Social Services Employers’ Association of British Columbia

Crown Corporations Employers’ Association

First Peoples’ Heritage, Language and Culture Council

Health Employers Association of British Columbia

Post–Secondary Employers’ Association

Provincial Rental Housing Corporation

The Royal British Columbia Museum Corporation

SELF–SUPPORTED CROWN CORPORATIONS AND AGENCIES

(GOVERNMENT BUSINESS ENTERPRISES)

RECORDED ON A MODIFIED EQUITY BASIS

British Columbia Hydro and Power Authority⁶

British Columbia Liquor Distribution Branch⁷

British Columbia Lottery Corporation⁷

Columbia Power Corporation⁶

Insurance Corporation of British Columbia⁸

¹The Consolidated Revenue Fund has been allocated to the appropriate sector on the Consolidated Statement of Financial Position by Sector (page 96) and on the Consolidated Statement of Operations by Sector (page 100). 

²This organization reflects a government partnership amongst Canadian provinces and is proportionally consolidated based upon the province’s share (14.67%) of the total provincial contributions to the partnership. 

³This organization was renamed during the year.

⁴This organization was wound up during the year. 

⁵This organization left the Government Reporting Entity during the year. 

⁶These organizations were included in the Natural Resources and Economic Development Sector results.

⁷These organizations were included in the General Government Sector results.

⁸This organization was included in the Protection of Persons and Property Sector results.

96 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Financial Position by Sector

as at March 31, 2023

	In Millions
	Health				Education				Social Services				Other1				Natural Resources and Economic Development
	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
	$		$		$		$		$		$		$		$		$		$
Financial Assets
Cash and cash equivalents		2,179		2,735		3,333		3,302		47		36		194		134		156		165
Temporary investments				1		135		73						117		105		124		104
Accounts receivable		952		947		393		472		63		58		293		280		913		901
Inventories for resale		3		3		29		19						2		2		64		41
Due from Crown corporations and agencies		13		14		43		44		1		1		134		51		7		11
Due from other governments		88		156		98		60		56		55		96		67		197		195
Due from self–supported Crown corporations and agencies						82		60										91		60
Equity in self–supported Crown corporations and agencies						109		100										8,469		8,145
Loans, advances and mortgages receivable		626		614		911		889		1		1		1,269		979		64		58
Other investments		81		81		3,659		3,202						197		192		291		289
Sinking fund investments						67		64
Derivative financial instruments
Loans for purchase of assets, recoverable from agencies
		3,942		4,551		8,859		8,285		168		151		2,302		1,810		10,376		9,969

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 97

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Financial Position by Sector

as at March 31, 2023—Continued

	In Millions
	Debt Servicing2				Protection of Persons and Property				Transportation				General Government3				Adjustments4						Total
	2023		2022		2023		2022		2023		2022		2023		2022		2023			2022			2023		2022
	$		$		$		$		$		$		$		$		$			$			$		$
Financial Assets
Cash and cash equivalents		4,322		2,424		41		28		72		76		376		540		(2,887	)		(2,613	)		7,833		6,827
Temporary investments						38		32																414		315
Accounts receivable		803		389		107		93		59		67		4,041		3,717		(228	)		(145	)		7,396		6,779
Inventories for resale						2		2		1		4		2		3								103		74
Due from Crown corporations and agencies										10		3						(208	)		(124	)		0		0
Due from other governments						516		961		134		116		175		168								1,360		1,778
Due from self–supported Crown corporations and agencies														248		211								421		331
Equity in self–supported Crown corporations and agencies						3,753		3,709		232		238		71		31								12,634		12,223
Loans, advances and mortgages receivable						1		1						1,898		1,667		(7	)		(10	)		4,763		4,199
Other investments		9		9		58		95		76		76												4,371		3,944
Sinking fund investments		521		510						57		76						(124	)		(140	)		521		510
Derivative financial instruments		663																						663		0
Loans for purchase of assets, recoverable from agencies		47,946		42,356														(19,801	)		(15,138	)		28,145		27,218
		54,264		45,688		4,516		4,921		641		656		6,811		6,337		(23,255	)		(18,170	)		68,624		64,198

98 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Financial Position by Sector

as at March 31, 2023—Continued

	In Millions
	Health						Education						Social Services						Other1						Natural Resources and Economic Development
	2023			2022			2023			2022			2023			2022			2023			2022			2023		2022
	$			$			$			$			$			$			$			$			$		$
Liabilities
Accounts payable and accrued liabilities		4,269			2,934			2,443			2,288			769			388			1,921			1,049			3,055		1,819
Employee future benefits		1,551			1,438			745			754			31			35			18			17			43		44
Due to other governments		106			102			47			95			1			2			304			27			10		11
Due to Crown corporations, agencies and trust funds		143			54			13			15			7			6			15			66			629		643
Due to the Province of British Columbia														11			6			9			8			11		10
Deferred revenue		3,672			3,580			5,782			5,270			491			319			295			230			749		852
Taxpayer–supported debt		1,984			1,840			978			1,026									1,241			977			155		164
Self–supported debt
Derivative financial instruments
		11,725			9,948			10,008			9,448			1,310			756			3,803			2,374			4,652		3,543
Net assets (liabilities)		(7,783	)		(5,397	)		(1,149	)		(1,163	)		(1,142	)		(605	)		(1,501	)		(564	)		5,724		6,426
Non–financial Assets
Tangible capital assets		11,344			10,117			20,052			19,170			128			140			3,662			3,467			2,267		2,273
Restricted assets		5			5			2,219			2,142
Prepaid program costs		559			801			116			113			47			22			9			60			243		239
Other assets		240			305			3			3
		12,148			11,228			22,390			21,428			175			162			3,671			3,527			2,510		2,512
Accumulated surplus (deficit)		4,365			5,831			21,241			20,265			(967	)		(443	)		2,170			2,963			8,234		8,938

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 99

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Financial Position by Sector

as at March 31, 2023—Continued

	In Millions
	Debt Servicing2						Protection of Persons and Property				Transportation						General Government3				Adjustments4						Total
	2023			2022			2023		2022		2023			2022			2023		2022		2023			2022			2023			2022
	$			$			$		$		$			$			$		$		$			$			$			$
Liabilities
Accounts payable and accrued liabilities		745			841			908		545		1,981			3,066			1,518		1,273		(223	)		(143	)		17,386			14,060
Employee future benefits								65		67		35			35			746		685								3,234			3,075
Due to other governments								290		337		5			1			2,345		98								3,108			673
Due to Crown corporations, agencies and trust funds		2,896			2,621			2		2		6			7							(3,068	)		(2,713	)		643			701
Due to the Province of British Columbia												5			1							(36	)		(25	)		0			0
Deferred revenue					64			1,032		334		2,973			2,717			11		13								15,005			13,379
Taxpayer–supported debt		56,355			58,293							18,895			15,235			310		319		(19,354	)		(15,289	)		60,564			62,565
Self–supported debt		28,332			27,209																							28,332			27,209
Derivative financial instruments		1,031										574										(574	)					1,031			0
		89,359			89,028			2,297		1,285		24,474			21,062			4,930		2,388		(23,255	)		(18,170	)		129,303			121,662
Net assets (liabilities)		(35,095	)		(43,340	)		2,219		3,636		(23,833	)		(20,406	)		1,881		3,949		0			0			(60,679	)		(57,464	)
Non–financial Assets
Tangible capital assets								169		144		20,408			19,130			1,798		1,707		(17	)		(15	)		59,811			56,133
Restricted assets																												2,224			2,147
Prepaid program costs								7		6		50			31			73		75								1,104			1,347
Other assets					80										56													243			444
		0			80			176		150		20,458			19,217			1,871		1,782		(17	)		(15	)		63,382			60,071
Accumulated surplus (deficit)		(35,095	)		(43,260	)		2,395		3,786		(3,375	)		(1,189	)		3,752		5,731		(17	)		(15	)		2,703			2,607

¹The Other Sector consists of activities, such as housing and culture, which cannot be allocated to any of the specifically described sector classifications.

²Debt servicing represents the financial impacts of activities related to management of the public debt.

³Includes the Legislature, tax collection and administration, Canadian Health and Social Transfers from the federal government, liquor and gaming profits, general administration and central agency services such as accounting, auditing, budgeting, insurance and risk management to all sectors.

⁴Represents sectoral adjustments to conform to government accounting policies and to eliminate transactions between sectors.

100 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Operations by Sector

for the Fiscal Year Ended March 31, 2023

	In Millions
	Health				Education				Social Services				Other1				Natural Resources and Economic Development
	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
	$		$		$		$		$		$		$		$		$		$
Revenue
Taxation														106		101
Contributions from the federal government		291		333		1,398		1,347		551		243		244		222		194		177
Fees and licenses		652		499		2,898		2,752		3		3		40		41		157		139
Miscellaneous		1,590		1,390		1,583		1,491		24		28		125		97		360		193
Contributions from the provincial government / net earnings of self–supported Crown corporations and agencies		85		81		358		304		23		20		248		101		540		835
Natural resources																		6,198		4,471
Investment income		72		17		332		315		5		2		14		17		27		25
Total revenue		2,690		2,320		6,569		6,209		606		296		777		579		7,476		5,840

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 101

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Operations by Sector

for the Fiscal Year Ended March 31, 2023—Continued

	In Millions
	Debt Servicing2				Protection of Persons and Property					Transportation				General Government3				Adjustments4						Total
	2023		2022		2023			2022		2023		2022		2023		2022		2023			2022			2023		2022
	$		$		$			$		$		$		$		$		$			$			$		$
Revenue
Taxation											597		575		48,322		40,041								49,025		40,717
Contributions from the federal government						665			726		255		164		8,928		8,768								12,526		11,980
Fees and licenses						1,069			1,052		75		63		34		35								4,928		4,584
Miscellaneous		2		1		237			226		96		158		503		419		(75	)		(93	)		4,445		3,910
Contributions from the provincial government / net earnings of self–supported Crown corporations and agencies						(197	)		2,199		8		25		2,783		2,401		(750	)		(542	)		3,098		5,424
Natural resources																									6,198		4,471
Investment income		1,462		1,273		4			4		11		9		105		60		(716	)		(416	)		1,316		1,306
Total revenue		1,464		1,274		1,778			4,207		1,042		994		60,675		51,724		(1,541	)		(1,051	)		81,536		72,392

102 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Operations by Sector

for the Fiscal Year Ended March 31, 2023—Continued

	In Millions
	Health						Education						Social Services						Other1						Natural Resources and Economic Development
	2023			2022			2023			2022			2023			2022			2023			2022			2023		2022
	$			$			$			$			$			$			$			$			$		$
Expense
Salaries and benefits		12,498			11,253			11,631			11,080			605			551			261			236			1,020		908
Government transfers		7,327			6,636			1,662			1,520			7,541			5,336			4,997			2,457			3,930		2,748
Operating costs		9,935			9,257			2,438			2,117			1,542			1,389			288			248			937		1,171
Interest		124			119			47			43									33			10			23		22
Amortization		736			652			1,068			945			23			23			138			126			142		134
Other		321			147			263			213			86			71			66			29			282		282
Operating expense		30,941			28,064			17,109			15,918			9,797			7,370			5,783			3,106			6,334		5,265
Surplus (deficit) for the Fiscal Year ended March 31		(28,251	)		(25,744	)		(10,540	)		(9,709	)		(9,191	)		(7,074	)		(5,006	)		(2,527	)		1,142		575

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 103

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Operations by Sector

for the Fiscal Year Ended March 31, 2023—Continued

	In Millions
	Debt Servicing2						Protection of Persons and Property					Transportation						General Government3				Adjustments4						Total
	2023			2022			2023			2022		2023			2022			2023		2022		2023			2022			2023		2022
	$			$			$			$		$			$			$		$		$			$			$		$
Expense
Salaries and benefits								1,161			1,108		259			239			779		749								28,214		26,124
Government transfers								1,517			1,333		1,224			2,345			581		411		(533	)		(361	)		28,246		22,425
Operating costs								760			452		1,196			1,239			505		473		(6	)		(6	)		17,595		16,340
Interest		2,620			2,525								574			421			17		17		(719	)		(415	)		2,719		2,742
Amortization								34			31		646			633			139		137								2,926		2,681
Other								49			34		20			22			328		286		(283	)		(269	)		1,132		815
Operating expense		2,620			2,525			3,521			2,958		3,919			4,899			2,349		2,073		(1,541	)		(1,051	)		80,832		71,127
Surplus (deficit) for the Fiscal Year ended March 31		(1,156	)		(1,251	)		(1,743	)		1,249		(2,877	)		(3,905	)		58,326		49,651		0			0			704		1,265

¹The Other Sector consists of activities, such as housing and culture, which cannot be allocated to any of the specifically described sector classifications.

²Debt servicing represents the financial impacts of activities related to management of the public debt.

³Includes the Legislature, tax collection and administration, Canadian Health and Social Transfers from the federal government, liquor and gaming profits, general administration and central agency services such as accounting, auditing, budgeting, insurance and risk management to all sectors.

⁴Represents sectoral adjustments to conform to government accounting policies and to eliminate transactions between sectors.

104 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Statement of Financial Position

for Self–supported Crown Corporations and Agencies¹

as at March 31, 2023

	In Millions
	Natural Resources and Economic Development2			Protection of Persons and Property3		General Government4			2023 Sub–Total		2022 Sub–Total
	$			$		$			$		$
Assets
Cash and cash equivalents		160			26		41			227		271
Accounts receivable		1,029			1,696		85			2,810		3,127
Inventories		387					242			629		482
Other investments		1,933			19,501		83			21,517		22,141
Tangible capital assets		38,805			401		700			39,906		37,011
Other assets		4,303			557		122			4,982		5,398
Total Assets		46,617			22,181		1,273			70,071		68,430
Liabilities
Accounts payable and accrued liabilities		5,073			15,727		482			21,282		22,591
Deferred revenue		5,202			2,648		30			7,880		6,540
Due to Province of British Columbia		91					248			339		271
Debt due to Province of British Columbia		27,320					140			27,460		26,395
Other debt		1,429			52		302			1,783		1,715
		39,115			18,427		1,202			58,744		57,512
Equity
Investment by Province of British Columbia		46								46		46
Other comprehensive income		(58	)		603		88			633		402
Unremitted earnings–end of year		7,514			3,151		(17	)		10,648		10,470
		7,502			3,754		71			11,327		10,918
Total Liabilities and Equity		46,617			22,181		1,273			70,071		68,430

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 105

Supplementary Statement to the Summary Financial Statements

Statement of Financial Position

for Self–supported Crown Corporations and Agencies¹

as at March 31, 2023—Continued

	In Millions
	Education subsidiaries5		Natural Resources subsidiaries6		Transportation subsidiaries7			2023 Grand Total		2022 Grand Total
	$		$		$			$		$
Assets
Cash and cash equivalents		61		25		21			334		478
Accounts receivable		126		490		3			3,429		3,711
Inventories		43							672		559
Other investments		70		20		271			21,878		22,449
Tangible capital assets		711		843		151			41,611		38,690
Other assets		2		263		4			5,251		5,665
Total Assets		1,013		1,641		450			73,175		71,552
Liabilities
Accounts payable and accrued liabilities		54		13		194			21,543		22,972
Deferred revenue		49		1		24			7,954		6,596
Due to Province of British Columbia		82							421		331
Debt due to Province of British Columbia		32							27,492		26,432
Other debt		685		662		1			3,131		2,998
		902		676		219			60,541		59,329
Equity
Investment by Province of British Columbia		74		941		107			1,168		1,167
Other comprehensive income						(6	)		627		396
Unremitted earnings–end of year		37		24		130			10,839		10,660
		111		965		231			12,634		12,223
Total Liabilities and Equity		1,013		1,641		450			73,175		71,552

¹Self–supported Crown corporations and agencies report under International Financial Reporting Standards. These statements include related party transactions between self–supported Crown corporations and with taxpayer–supported entities. No elimination entries are recorded for these transactions. They are in the normal course of operations and are recorded at the exchange amount. The normal course of operations includes trade, financial and legal services, shared administration, business relationships, collaboration on projects, carbon offsets, and payment of cash dividends. Significant balances are disclosed in the notes to these financial statements.

²British Columbia Hydro and Power Authority and Columbia Power Corporation.

³Insurance Corporation of British Columbia.

⁴British Columbia Liquor Distribution Branch and government's proportionate share of British Columbia Lottery Corporation.

⁵Self–supported subsidiaries, including Great Northern Way Campus Trust, Heritage Realty Properties Ltd., SFU Community Trust, UBC Properties Trust, and Vancouver Island Technology Park Trust, of post–secondary institutions.

⁶Columbia Basin Trust joint ventures with Columbia Power Corporation (Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation, and Waneta Expansion Power Corporation).

⁷British Columbia Rail Company, a subsidiary of BC Transportation Financing Authority.

106 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Summary of Results of Operations and Statement

of Equity for Self–supported Crown Corporations and Agencies¹

for the Fiscal Year Ended March 31, 2023

	In Millions
	Natural Resources and Economic Development2			Protection of Persons and Property3			General Government4			2023 Sub–Total			2022 Sub–Total
	$			$			$			$			$
Revenue		8,116			5,826			6,777			20,719			19,963
Expense		7,694			6,023			3,994			17,711			14,621
Net earnings of self–supported Crown corporations and agencies		422			(197	)		2,783			3,008			5,342
Dividends		(47	)					(2,529	)		(2,576	)		(2,230	)
Adjustments to dividends								(254	)		(254	)		(217	)
Transfers (to) from deferred revenue											0			0
Increase(decrease) in unremitted earnings in self–supported Crown corporations and agencies		375			(197	)		0			178			2,895
Unremitted earnings—beginning of year		7,139			3,348			(17	)		10,470			7,575
Unremitted earnings—end of year		7,514			3,151			(17	)		10,648			10,470
Accumulated other comprehensive income—beginning of year		(8	)		361			49			402			688
Adjustments to accumulated other comprehensive income											0			0
Other comprehensive income		(50	)		242			39			231			(286	)
Accumulated other comprehensive income—end of year		(58	)		603			88			633			402
Investment by Province of British Columbia		46									46			46
Equity in self–supported Crown corporations and agencies for the year		7,502			3,754			71			11,327			10,918

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 107

Supplementary Statement to the Summary Financial Statements

Summary of Results of Operations and Statement

of Equity for Self–supported Crown Corporations and Agencies¹

for the Fiscal Year Ended March 31, 2023—Continued 

	In Millions
	Education subsidiaries5			Natural Resources subsidiaries6			Transportation subsidiaries7			2023 Grand Total			2022 Grand Total
	$			$			$			$			$
Revenue		44			149			32			20,944			20,191
Expense		26			70			39			17,846			14,767
Net earnings of self–supported Crown corporations and agencies		18			79			(7	)		3,098			5,424
Dividends		(26	)		(80	)					(2,682	)		(2,332	)
Adjustments to dividends											(254	)		(217	)
Transfers (to) from deferred revenue		17									17			3
Increase(decrease) in unremitted earnings in self–supported Crown corporations and agencies		9			(1	)		(7	)		179			2,878
Unremitted earnings—beginning of year		28			25			137			10,660			7,782
Unremitted earnings—end of year		37			24			130			10,839			10,660
Accumulated other comprehensive income—beginning of year								(6	)		396			683
Adjustments to accumulated other comprehensive income
Other comprehensive income											231			(287	)
Accumulated other comprehensive income—end of year		0			0			(6	)		627			396
Investment by Province of British Columbia		74			941			107			1,168			1,167
Equity in self–supported Crown corporations and agencies for the year		111			965			231			12,634			12,223

¹Self–supported Crown corporations and agencies report under International Financial Reporting Standards. These statements include related party transactions between self–supported Crown corporations and with taxpayer–supported entities. No elimination entries are recorded for these transactions. They are in the normal course of operations and are recorded at the exchange amount. The normal course of operations includes trade, financial and legal services, shared administration, business relationships, collaboration on projects, carbon offsets, and payment of cash dividends. Significant balances are disclosed in the notes to these financial statements.

²British Columbia Hydro and Power Authority and Columbia Power Corporation.

³Insurance Corporation of British Columbia.

⁴British Columbia Liquor Distribution Branch and government's proportionate share of British Columbia Lottery Corporation.

⁵Self–supported subsidiaries, including Great Northern Way Campus Trust, Heritage Realty Properties Ltd., SFU Community Trust, UBC Properties Trust, and Vancouver Island Technology Park Trust, of post–secondary institutions.

⁶Columbia Basin Trust joint ventures with Columbia Power Corporation (Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation, and Waneta Expansion Power Corporation).

⁷British Columbia Rail Company, a subsidiary of BC Transportation Financing Authority.

108 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the Summary Financial Statements

Consolidated Statement of Tangible Capital Assets¹

for the Fiscal Year Ended March 31, 2023

	In Millions
	Land and Land Improvements			Building			Highway Infrastruc– ture			Transport – ation Equipment			Computer Hardware/ Software			Other3			2023 Total			2022 Total
	$			$			$			$			$			$			$			$
Historical Cost2
Opening Cost		6,515			46,284			26,634			4,822			5,676			7,554			97,485			92,033
Additions		145			3,531			1,392			505			518			664			6,755			6,020
Disposals and valuation adjustments					(216	)		(14	)		(18	)		(183	)		(347	)		(778	)		(568	)
		6,660			49,599			28,012			5,309			6,011			7,871			103,462			97,485
Accumulated Amortization
Opening balance		(386	)		(18,178	)		(12,367	)		(1,702	)		(3,485	)		(5,234	)		(41,352	)		(39,182	)
Amortization expense		(31	)		(1,282	)		(560	)		(117	)		(415	)		(521	)		(2,926	)		(2,681	)
Effect of disposals and valuation adjustments		(23	)		93			14			17			188			338			627			511
		(440	)		(19,367	)		(12,913	)		(1,802	)		(3,712	)		(5,417	)		(43,651	)		(41,352	)
Net book value for the year ended March 31, 2023		6,220			30,232			15,099			3,507			2,299			2,454			59,811
Net book value for the year ended March 31, 2022		6,129			28,106			14,267			3,120			2,191			2,320						56,133

¹This statement includes assets that are held on capital leases at March 31, 2023 at a gross value of $402 million less accumulated amortization of $(134) million for a net book value totalling $268 million (2022: gross value of $387 million less accumulated amortization of $(118) million for a net book value of $269 million) comprised of: heavy equipment gross $2 million less accumulated amortization $(2) million for a net book value of nil (2022: gross $2 million less accumulated amortization $(2) million for a net book value of nil); computer hardware/software gross $72 million less accumulated amortization $(43) million for a net book value of $29 million (2022: gross $67 million less accumulated amortization $(36) million for a net book value of $31 million); buildings gross $321 million less accumulated amortization $(83) million for a net book value of $238 million (2022: gross $310 million less accumulated amortization $(74) million for a net book value $236 million); and other assets gross $7 million less accumulated amortization $(6) million for a net book value of $1 million (2022: gross $8 million less accumulated amortization $(6) million for a net book value of $2 million).

²Historical cost includes work–in–progress at March 31, 2023 totalling $8,270 million (2022: $6,820 million) comprised of: buildings $4,271 million (2022: $3,334 million); land improvements $71 million (2022: $84 million); highway infrastructure $2,099 million (2022: $1,385 million); transportation equipment $1,082 million (2022: $659 million); computer hardware/software $533 million (2022: $1,187 million); and specialized equipment $214 million (2022: $171 million). Work–in–progress is not amortized. Work–in–progress includes capitalized interest expense at March 31, 2023 totalling $38 million (2022: $13 million).

³"Other" at net book value includes office furniture and equipment $932 million (2022: $884 million), vehicles $107 million (2022: $100 million), machinery $1,243 million (2022: $1,165 million) and miscellaneous $172 million (2022: $171 million).

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23 109

Supplementary Statement to the

Summary Financial Statements

Consolidated Statement of Guaranteed Debt

as at March 31, 2023

Guaranteed debt represents the debt of organizations that has been explicitly guaranteed or indemnified by the government under the authority of a statute as to net principal or redemption provisions. These organizations may include municipalities and other governments, private enterprises and individuals, minority interests of provincial Crown corporations and agencies, and SUCH¹ sector entities.

	In Millions
	2023					2022
	Maximum Guarantee Authorized		Net Outstanding			Maximum Guarantee Authorized		Net Outstanding
	$		$			$		$
Taxpayer–supported Guaranteed Debt
General government:
Homeowner Protection Act loan guarantees2		375					375
Subtotal, general government		375		0			375		0
Natural resources and economic development:
Financial Administration Act:
Feeder's Association Loan Guarantee		13		5			13		6
Subtotal, natural resources and economic development		13		5			13		6
Total taxpayer–supported guaranteed debt		388		5			388		6
Self–supported Guaranteed Debt
Hydro and Power Authority Act bonds and debentures3		10		10			10		10
Total self–supported guaranteed debt		10		10			10		10
Grand total, all guaranteed debt		398		15			398		16
Provision for probable payout				(1	)				(1	)
Net total, all guaranteed debt		398		14			398		15

¹School districts, universities, colleges and health authorities/hospital societies.

²Homeowner Protection Act loan guarantees include indemnities provided to Canada Mortgage and Housing Corporation for any claims made on reconstruction loans made to homeowners for repairs to homes with premature building envelope failure.

³The government has unconditionally guaranteed the payment of principal and interest for $10 million (2022: $10 million) of debentures issued to the Canada Pension Plan Investment Fund that matures on August 9, 2024 with a coupon rate of 5.54%.

110 PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

Supplementary Statement to the

Summary Financial Statements

Schedule of Investments

as at March 31, 2023

Investments include short–term cash equivalents and portfolio investments.

	In millions
	Cost		Fair value level 1		Fair value level 2		Fair value level 3		Pensions1		Total
	$		$		$		$		$		$
Interest–bearing securities				2,783		96		1				2,880
Equities				2,379		28		55				2,462
Other types of investments		701		32		20		1,183		253		2,189
Total		701		5,194		144		1,239		253		7,531

¹ Pension investments included in the financial statements of certain post–secondary institutions.

Supplementary Information

(Unaudited)

The following unaudited supplementary information is intended to provide additional information to financial statement readers and includes:

a) the impacts of the Crown corporations and the school districts, universities, colleges, institutes and health organizations (SUCH) sector on the province’s annual surplus (deficit); and

b) the Consolidated Staff Utilization.

The purpose of this information is to report organizational impacts on the Summary Financial Statements.

PROVINCE OF BRITISH COLUMBIA

PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA	113
PUBLIC ACCOUNTS 2022/23

Adjusted Net Income of Crown Corporations, Agencies and the SUCH Sector¹

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	Revenue		Expense			Net Income			Adjustments			Dividends		Adjusted Net Income2
	$		$			$			$			$		$
Taxpayer–supported (Government Organizations)
BC Family Maintenance Agency Ltd.		20		(20	)
BC Financial Services Authority		66		(62	)		4			(1	)				3
BC Games Society		6		(6	)
BC Health Care Occupational Health and Safety Society		3		(3	)					(1	)				(1	)
BC Infrastructure Benefits Inc.		143		(143	)
BCNET		24		(23	)		1								1
B.C. Pavilion Corporation		132		(137	)		(5	)		(20	)				(25	)
BC Transportation Financing Authority		645		(1,506	)		(861	)		(21	)				(882	)
British Columbia Assessment Authority		116		(117	)		(1	)							(1	)
British Columbia Energy Regulator		114		(102	)		12			(1	)				11
British Columbia Housing Management Commission		2,410		(2,410	)					220					220
British Columbia Public School Employers’ Association		9		(9	)					1					1
British Columbia Securities Commission		74		(68	)		6								6
British Columbia Transit		412		(410	)		2			23					25
Canadian Blood Services		200		(202	)		(2	)		3					1
Columbia Basin Trust		17		(86	)		(69	)		1			80		12
Community Living British Columbia		1,455		(1,455	)					(2	)				(2	)
Community Social Services Employers’ Association of British Columbia		4		(4	)
Creston Valley Wildlife Management Authority Trust Fund		1		(1	)
Crown Corporations Employers’ Association
Destination BC Corp.		63		(63	)
First Peoples’ Heritage, Language and Culture Council		39		(39	)					2					2
Forest Enhancement Society of BC		9		(9	)					18					18
Forestry Innovation Investment Ltd.		25		(25	)

114	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Adjusted Net Income of Crown Corporations, Agencies and the SUCH Sector¹

for the Fiscal Year Ended March 31, 2023—Continued

(Unaudited)

	In Millions
	Revenue		Expense			Net Income			Adjustments			Dividends		Adjusted Net Income2
	$		$			$			$			$		$
Taxpayer–supported (Government Organizations)—Continued
Health Employers Association of British Columbia		36		(36	)					120					120
InBC Investment Corp.		1		(4	)		(3	)							(3	)
Infrastructure BC Inc.		10		(9	)		1								1
Innovate BC		17		(17	)
Knowledge Network Corporation		21		(20	)		1			2					3
Legal Services Society		123		(123	)					(5	)				(5	)
Nechako–Kitamaat Development Fund Society
Organized Crime Agency of British Columbia Society		27		(27	)
Post–Secondary Employers’ Association		3		(3	)
Provincial Rental Housing Corporation		145		(139	)		6			177					183
Real Estate Foundation of British Columbia		17		(9	)		8			(24	)				(16	)
SkilledTradesBC		118		(116	)		2								2
The British Columbia Council for International Education		2		(2	)
The Royal British Columbia Museum Corporation		26		(31	)		(5	)		11					6
Taxpayer–supported Crown corporations and agencies		6,533		(7,436	)		(903	)		503			80		(320	)
SUCH Sector
School Districts		7,907		(7,934	)		(27	)		366					339
Universities		6,230		(6,053	)		177			185			26		388
Colleges and Institutes		1,596		(1,591	)		5			90					95
Health Authorities		22,486		(22,687	)		(201	)		780					579
Hospital Societies		1,351		(1,355	)		(4	)		23					19
SUCH sector		39,570		(39,620	)		(50	)		1,444			26		1,420
Net impact of taxpayer–supported Crown corporations, agencies and SUCH sector		46,103		(47,056	)		(953	)		1,947			106		1,100

PROVINCE OF BRITISH COLUMBIA	115
PUBLIC ACCOUNTS 2022/23

Adjusted Net Income of Crown Corporations, Agencies and the SUCH Sector¹

for the Fiscal Year Ended March 31, 2023—Continued

(Unaudited)

	In Millions
	Revenue		Expense			Net Income			Adjustments		Dividends			Adjusted Net Income2
	$		$			$			$		$			$
Self–supported (Government Enterprises)
British Columbia Hydro and Power Authority		8,027		(7,667	)		360								360
British Columbia Liquor Distribution Branch		3,892		(2,693	)		1,199					(1,199	)
British Columbia Lottery Corporation		2,885		(1,301	)		1,584					(1,584	)
Columbia Power Corporation		89		(27	)		62					(47	)		15
Insurance Corporation of British Columbia		5,826		(6,023	)		(197	)							(197	)
Sub–total		20,719		(17,711	)		3,008			0		(2,830	)		178
British Columbia Railway Company3		32		(39	)		(7	)							(7	)
Columbia Basin Trust joint ventures4		149		(70	)		79					(80	)		(1	)
Great Northern Way Campus Trust5		4		(6	)		(2	)							(2	)
Heritage Realty Properties Ltd.6		4		(4	)
SFU Community Trust		1					1					(18	)		(17	)
UBC Properties Investments Ltd.		20					20					(8	)		12
Vancouver Island Technology Park Trust6		6		(6	)
Miscellaneous		9		(10	)		(1	)							(1	)
Sub–total		225		(135	)		90			0		(106	)		(16	)
Net impact of self–supported Crown corporations and agencies		20,944		(17,846	)		3,098			0		(2,936	)		162

¹This schedule does not include elimination entries between entities.

²Adjusted Net Income includes the effect of contributions paid to the Consolidated Revenue Fund to indicate the impacts that the Crown corporations and agencies and the SUCH sector have made on the Consolidated Revenue Fund operating result. The Adjusted Net Income of Crown corporations and agencies and the SUCH sector combined with the Consolidated Revenue Fund operating result, after elimination entries between entities, make up the Summary Financial Statements surplus (deficit).

³Subsidiary of BC Transportation Financing Authority.

⁴Columbia Basin Trust joint ventures with Columbia Power Corporation (Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation, and Waneta Expansion Power Corporation).

⁵Subsidiary owned 25% each by Emily Carr University of Art & Design, British Columbia Institute of Technology, The University of British Columbia, and Simon Fraser University.

⁶Subsidiaries of the University of Victoria.

116	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

SUCH ¹ Statement of Financial Position

as at March 31, 2023

(Unaudited)

	In Millions
	Health
	Authorities &
	Hospital						Colleges and			School		2023			2022
	Societies2			Universities			Institutes			Districts		Total			Total
	$			$			$			$		$			$
Financial Assets
Cash and cash equivalents		2,150			866			537			1,915		5,468			5,998
Temporary investments		1			59			20			56		136			76
Accounts receivable		485			280			44			99		908			820
Inventories for resale		166			15			13			1		195			467
Due from Crown corporations, agencies and trust funds		1,864			92			28			20		2,004			618
Due from other governments		65			33			6			3		107			99
Due from self–supported Crown corporations and agencies					71			2					73			59
Equity in self–supported Crown corporations and agencies					90			14			2		106			101
Loans, advances and mortgages receivable		700			105			1					806			806
Other investments		5			3,352			232			73		3,662			3,732
Sinking fund investments					49			16					65			67
Financial assets before accounting adjustments		5,436			5,012			913			2,169		13,530			12,843
Policy accounting adjustments		(134	)		(51	)		(4	)		23		(166	)		(968	)
Financial assets		5,302			4,961			909			2,192		13,364			11,875

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SUCH ¹ Statement of Financial Position

as at March 31, 2023—Continued

(Unaudited)

	In Millions
	Health
	Authorities &
	Hospital						Colleges and			School			2023			2022
	Societies2			Universities			Institutes			Districts			Total			Total
	$			$			$			$			$			$
Liabilities
Accounts payable and accrued liabilities		2,891			799			287			1,185			5,162			4,348
Employee future benefits		1,537			374			101			264			2,276			2,169
Due to other governments		92			30			12						134			99
Due to Crown corporations, agencies and trust funds		79			13			2			2			96			81
Deferred revenue		10,952			7,641			1,715			8,168			28,476			26,630
Taxpayer–supported debt		1,984			860			95			22			2,961			2,866
Liabilities before accounting adjustments		17,535			9,717			2,212			9,641			39,105			36,193
Policy accounting adjustments		(7,319	)		(3,014	)		(1,253	)		(7,482	)		(19,068	)		(18,010	)
Liabilities		10,216			6,703			959			2,159			20,037			18,183
Net liabilities		(4,914	)		(1,742	)		(50	)		33			(6,673	)		(6,308	)
Non–financial Assets
Tangible capital assets		11,369			8,072			1,793			10,170			31,404			29,325
Restricted assets		5			2,142			49			2			2,198			2,137
Prepaid program costs		341			75			17			22			455			414
Other assets		239									3			242			304
Non–financial assets before accounting adjustments		11,954			10,289			1,859			10,197			34,299			32,180
Policy accounting adjustments		1			(6	)		(6	)		(4	)		(15	)		258
Non–financial assets		11,955			10,283			1,853			10,193			34,284			32,438
Accumulated surplus (deficit)		7,041			8,541			1,803			10,226			27,611			26,130

¹ School districts, universities, colleges, institutes, and health organizations.

² These numbers include inter–entity eliminations between Health Authorities and Hospital Societies.

118	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

SUCH¹ Statement of Operations

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	Health Authorities & Hospital Societies2			Universities		Colleges and Institutes		School Districts			2023 Total			2022 Total
	$			$		$		$			$			$
Revenue
Contributions from the federal government		16			609		28		16			669			638
Fees and licenses		519			2,081		570		232			3,402			3,155
Contributions from the provincial government/Crown corporations and agencies		21,293			2,145		851		7,267			31,556			29,624
Miscellaneous		716			1,157		124		345			2,342			2,099
Investment income		64			257		22		47			390			323
Total revenue		22,608			6,249		1,595		7,907			38,359			35,839
Expense
Salaries and benefits		12,215			3,954		1,127		6,506			23,802			21,948
Government transfers					346		19					365			358
Operating costs		9,405			1,113		292		1,010			11,820			10,991
Interest		123			39		4		1			167			159
Amortization		714			455		112		404			1,685			1,575
Other		356			146		37		13			552			322
Total operating expense		22,813			6,053		1,591		7,934			38,391			35,353
Surplus (deficit) for the year before accounting adjustments		(205	)		196		4		(27	)		(32	)		486
Policy accounting adjustments		803			185		90		366			1,444			1,609
Surplus (deficit) for the year		598			381		94		339			1,412			2,095

¹ School districts, universities, colleges, institutes, and health organizations.

² These numbers include inter–entity eliminations between Health Authorities and Hospital Societies.

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PUBLIC ACCOUNTS 2022/23

Summary Financial Statements

Consolidated Staff Utilization¹

for the Fiscal Year Ended March 31, 2023

(Unaudited)

							Variance
							2022/23			2022/23
	2022/23		2022/23		2021/22		Actual			vs
	Budget		Actual		Actual		To Budget			2021/22
Consolidated Revenue Fund2		34,400		33,696		33,400		(704	)		296
Taxpayer–supported Crown corporations and agencies3		8,108		7,746		6,767		(362	)		979
Total staff utilization		42,508		41,442		40,167		(1,066	)		1,275

The table above provides a summary of full–time equivalent (FTE) employment.

¹Staff utilization is the full–time equivalent of the number of persons employed in the fiscal year whose salaries are paid by taxpayer–supported entities within the Summary Financial Statements. The figures do not include the SUCH entities or the self–supported Crown corporations and agencies.

²See the unaudited Consolidated Revenue Fund schedules at http://gov.bc.ca/publicaccounts for details outside these financial statements.

³See Financial Statements of Government Organizations and Enterprises at http://gov.bc.ca/financepublications for details outside these financial statements.

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Consolidated Revenue Fund

Extracts

(Unaudited)

The following unaudited Consolidated Revenue Fund Extracts are intended to provide additional information to financial statement readers and includes details of the Consolidated Revenue Fund.

The purpose of this information is to reflect management accountability including appropriation control.

The accounting policies applied for this unaudited information are different in some cases from the generally accepted accounting principles followed for the audited Summary Financial Statements. For example, in order to reflect different management accountabilities, the Consolidated Revenue Fund nets recoveries against expenses, nets sinking funds against debt and nets sinking fund earnings against interest expense.

PROVINCE OF BRITISH COLUMBIA
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PROVINCE OF BRITISH COLUMBIA	123
PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund¹

Statement of Financial Position

as at March 31, 2023

(Unaudited)

	In Millions
	2023			2022
	$			$
Financial Assets
Cash and cash equivalents		4,712			2,995
Accounts receivable		6,866			6,031
Inventories for resale		77			53
Due from other governments		1,175			1,602
Due from Crown corporations and agencies		353			280
Investments in Crown corporations and agencies		594			594
Loans, advances and mortgages receivable		2,749			2,517
Other investments		354			355
Derivative financial instruments		663
Loans for purchase of assets, recoverable from agencies		47,370			42,356
		64,913			56,783
Liabilities
Accounts payable and accrued liabilities		11,022			6,481
Employee future benefits		893			839
Due to other governments		2,960			572
Due to Crown corporations, agencies and trust funds		5,613			3,759
Deferred revenue		2,054			1,423
Taxpayer–supported debt		56,446			58,381
Self–supported debt		28,030			26,929
Derivative financial instruments		1,031
		108,049			98,384
Net assets (liabilities)		(43,136	)		(41,601	)
Non–financial Assets
Tangible capital assets		3,617			3,476
Prepaid program costs		387			341
Other assets					80
		4,004			3,897
Accumulated operating result		(39,132	)		(37,704	)

¹ The Consolidated Revenue Fund includes the General Fund and the BC Prosperity Fund.

124	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund¹

Statement of Operations

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	2023						2022
	Estimates2			Actual			Actual
	$			$			$
Revenue
Taxation		39,274			48,207			39,920
Contributions from the federal government		8,685			9,581			9,537
Other revenue		1,545			1,890			1,596
Dividends		2,383			2,575			2,231
Natural resources		3,119			5,511			4,181
		55,006			67,764			57,465
Expense
Health		27,679			29,054			26,943
Education		11,599			11,468			10,939
Social services		7,367			9,195			7,093
Other		7,202			5,324			2,742
Natural resources and economic development		2,921			5,014			4,445
Interest3		1,361			1,290			1,267
Protection of persons and property		2,150			3,084			2,570
Transportation		924			2,021			1,118
General government		1,345			1,872			1,599
		62,548			68,322			58,716
Operating result for the year		(7,542	)		(558	)		(1,251	)
Accumulated operating result —beginning of year					(37,704	)		(36,453	)
Net remeasurement gains and (losses)					(870	)
Accumulated operating result —end of year					(39,132	)		(37,704	)

¹The Consolidated Revenue Fund includes the General Fund and the BC Prosperity Fund.

²The estimated amount consists of the Main Estimates presented to the Legislative Assembly on February 22, 2022. It does not include other authorizations granted in subsequent Supplementary Estimates or under statutory authority of $7,968 million (2022: $2,055 million)

³Interest expense does not include the following: interest of $1,262 million (2022: $1,251 million) on cost of borrowing for relending to government bodies; and interest of $7 million (2022: $6 million) funded by sinking fund earnings. These amounts are not included because the interest expense and recovery are offsetting.

PROVINCE OF BRITISH COLUMBIA	125
PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund¹

Statement of Remeasurement Gains and Losses

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	2023			2022
	$			$
Accumulated remeasurement gains (losses) – beginning of year		0			0
Adjustments for adoption of the financial instruments–related standards:
Foreign exchange		120
Derivatives		144
Portfolio investments		12
Total adjusted accumulated remeasurement gains (losses) – beginning of year		276			0
Changes in unrealized gains (losses) attributable to:
Foreign exchange		(1,125	)
Derivatives		287
Portfolio investments		(43	)
Total changes in unrealized gains (losses)		(881	)		0
Amounts reclassified to the statement of operations:
Foreign exchange		533
Derivatives		(798	)
Total reclassified to the statement of operations		(265	)		0
Total remeasurement gains (losses) attributable to:
Foreign exchange		(472	)
Derivatives		(367	)
Portfolio investments		(31	)
Accumulated remeasurement gains (losses) – end of year		(870	)		0

¹ The Consolidated Revenue Fund includes the General Fund and the BC Prosperity Fund.

126	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

General Fund

Statement of Financial Position

as at March 31, 2023

(Unaudited)

	In Millions
	2023			2022
	$			$
Financial Assets
Cash and cash equivalents		4,152			2,455
Accounts receivable		6,866			6,031
Inventories for resale		77			53
Due from other governments		1,175			1,602
Due from Crown corporations and agencies		353			280
Investments in Crown corporations and agencies		594			594
Loans, advances and mortgages receivable		2,749			2,517
Other investments		354			355
Derivative financial instruments		663
Loans for purchase of assets, recoverable from agencies		47,370			42,356
		64,353			56,243
Liabilities
Accounts payable and accrued liabilities		11,022			6,481
Employee future benefits		893			839
Due to other governments		2,960			572
Due to Crown corporations, agencies and trust funds		5,613			3,759
Deferred revenue		2,054			1,423
Taxpayer–supported debt		56,446			58,381
Self–supported debt		28,030			26,929
Derivative financial instruments		1,031
		108,049			98,384
Net assets (liabilities)		(43,696	)		(42,141	)
Non–financial Assets
Tangible capital assets		3,617			3,476
Prepaid program costs		387			341
Other assets					80
		4,004			3,897
Accumulated operating result		(39,692	)		(38,244	)

PROVINCE OF BRITISH COLUMBIA	127
PUBLIC ACCOUNTS 2022/23

General Fund

Statement of Operations

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	2023						2022
	Estimates			Actual			Actual
	$			$			$
Revenue
Taxation		39,274			48,207			39,920
Contributions from the federal government		8,685			9,581			9,537
Other revenue		1,541			1,870			1,593
Dividends		2,383			2,575			2,231
Natural resources		3,119			5,511			4,181
		55,002			67,744			57,462
Expense
Health		27,679			29,054			26,943
Education		11,599			11,468			10,939
Social services		7,367			9,195			7,093
Other		7,202			5,324			2,742
Natural resources and economic development		2,921			5,014			4,445
Interest		1,361			1,290			1,267
Protection of persons and property		2,150			3,084			2,570
Transportation		924			2,021			1,118
General government		1,345			1,872			1,599
		62,548			68,322			58,716
Operating result for the year		(7,546	)		(578	)		(1,254	)
Accumulated operating result — beginning of year					(38,244	)		(36,990	)
Net remeasurement gains and (losses)					(870	)
Accumulated operating result—end of year					(39,692	)		(38,244	)

128	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

BC Prosperity Fund

Statement of Financial Position

as at March 31, 2023

(Unaudited)

	In Millions
	2023		2022
	$		$
Financial Assets
Cash and cash equivalents		560		540
		560		540
Accumulated operating result		560		540

BC Prosperity Fund

Statement of Operations

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	2023				2022
	Estimates		Actual		Actual
	$		$		$
Revenue
Other revenue		4		20		3
		4		20		3
Operating result for the year		4		20		3
Accumulated operating result—beginning of year				540		537
Accumulated operating result—end of year				560		540

PROVINCE OF BRITISH COLUMBIA	129
PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Statement of Cash Flow

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	2023								2022
	Receipts		Disbursements			Net			Net
	$		$			$			$
Operating Transactions
Operating result for the year							(558	)		(1,251	)
Non cash items included in surplus (deficit):
Amortization of tangible capital assets							318			291
Amortization of public debt deferred revenue and deferred charges							(25	)		(51	)
Concessionary loan adjustments increase							10			5
(Gain) on sale of tangible capital assets							(2	)		(1	)
Valuation adjustments							38			19
Accounts receivable (increase)							(830	)		(736	)
Due from other governments decrease (increase)							427			(34	)
Due from self–supported Crown corporations and agencies (increase)							(73	)		(70	)
Accounts payable increase							4,541			944
Employee future benefits increase							54			115
Due to other governments increase							2,388			32
Due to Crown corporations, agencies and funds increase							1,854			250
Employee pension plan (decrease)										(1	)
Items applicable to future operations increase							1,465			45
Cash derived from (used for) operations							9,607			(443	)
Capital Transactions
Tangible capital assets dispositions (acquisitions)		12		(470	)		(458	)		(377	)
Cash (used for) capital		12		(470	)		(458	)		(377	)
Investment Transactions
Loans, advances and mortgages receivable issues		256		(540	)		(284	)		(220	)
Other investments–net increase		4		(20	)		(16	)		(1	)
Cash (used for) investments		260		(560	)		(300	)		(221	)
Total cash inflows (requirements)							8,849			(1,041	)

130	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Statement of Cash Flow

for the Fiscal Year Ended March 31, 2023—Continued

(Unaudited)

	In Millions
	2023								2022
	Receipts		Disbursements			Net			Net
	$		$			$			$
Total cash inflows (requirements) carried forward from previous page							8,849			(1,041	)
Financing Transactions1
Public debt (decrease) increase		24,842		(26,161	)		(1,319	)		3,249
(Used for) purchase of assets, recoverable from agencies		13,762		(19,575	)		(5,813	)		(2,087	)
Cash (used for) derived from financing		38,604		(45,736	)		(7,132	)		1,162
Increase in cash and cash equivalents							1,717			121
Cash and cash equivalents—beginning of year							2,995			2,874
Cash and cash equivalents—end of year							4,712			2,995
Cash and cash equivalents are made up of:
Cash							4,397			2,943
Cash equivalents							315			52
							4,712			2,995

¹ Financing transaction receipts are from debt issues and disbursements are for debt repayments.

PROVINCE OF BRITISH COLUMBIA	131
PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Schedule of Net Revenue by Source

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Millions
	2023						2022
	Estimates			Actual			Actual
	$			$			$
Taxation Revenue1
Personal income		12,848			17,268			13,704
Provincial sales		9,002			9,811			8,727
Corporate income		5,501			9,156			5,053
Property		2,960			3,024			2,816
Property transfer		2,500			2,292			3,327
Employer health		2,257			2,720			2,443
Carbon		2,311			2,161			2,011
Tobacco		760			531			708
Fuel		566			555			546
Other		660			804			706
Commissions on collection of public funds		(69	)		(79	)		(75	)
Valuation adjustments		(22	)		(36	)		(46	)
Total taxation revenue		39,274			48,207			39,920
Contributions from the Federal Government
Canada health and social transfers		8,363			8,606			8,541
Other contributions		322			975			996
Total contributions from the federal government		8,685			9,581			9,537
Other Revenue
Motor vehicle licences and permits		614			613			610
Other fees and licences		518			607			573
Investment earnings		78			267			99
Miscellaneous		339			438			347
Asset dispositions		34			2			1
Commissions on collection of public funds		(7	)		(6	)		(7	)
Valuation adjustments		(31	)		(31	)		(27	)
Total other revenue		1,545			1,890			1,596
Dividends
Self–supported Crown corporations
British Columbia Liquor Distribution Branch		1,160			1,198			1,189
British Columbia Lottery Corporation		1,176			1,330			995
Columbia Power Corporation		47			47			47
Total dividends		2,383			2,575			2,231

132	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Schedule of Net Revenue by Source

for the Fiscal Year Ended March 31, 2023—Continued

(Unaudited)

	In Millions
	2023						2022
	Estimated			Actual			Actual
Natural Resource Revenue2
Forests		1,065			1,774			1,837
Petroleum, natural gas and minerals		1,358			2,932			1,690
Water and other		704			822			662
Commissions on collection of public funds		(1	)		(1	)		(1	)
Valuation adjustments		(7	)		(16	)		(7	)
Total natural resource revenue		3,119			5,511			4,181
Net Consolidated Revenue Fund Revenue		55,006			67,764			57,465
Revenue Collected for and Transferred to Crown Corporations, Agencies and Other Entities3
Ministry of Energy, Mines and Low Carbon Innovation
British Columbia Energy Regulator		(44	)		(48	)		(44	)
Ministry of Finance
British Columbia Transit		(18	)		(18	)		(18	)
BC Transportation Financing Authority		(474	)		(455	)		(462	)
Cowichan Tribes		(4	)		(4	)		(4	)
Municipalities or Eligible Entities		(53	)		(118	)		(63	)
Rural Areas		(430	)		(457	)		(423	)
South Coast British Columbia Transportation Authority		(398	)		(400	)		(400	)
Ministry of Forests
Habitat Conservation Trust		(6	)		(6	)		(5	)
Ministry of Indigenous Relations and Reconciliation
British Columbia First Nations Gaming Revenue Sharing Limited Partnership		(101	)		(114	)		(91	)
Total		(1,528	)		(1,620	)		(1,510	)

¹Personal income tax and corporate income tax revenues are recorded after deductions for non–refundable tax credits. Deductions allowable in the calculation of personal income tax revenue were $176 million (2022: $110 million) and corporate income tax were $232 million (2022: $127 million). The types of tax credits adjusting personal income tax and corporation income tax revenues are for foreign taxes, logging taxes, venture capital, scientific and experimental development tax, and mining flow–through share.

Personal income tax revenue was also reduced by $199 million (2022: $191 million) for the BC Tax Reduction.

Personal and corporate income tax refunds related to prior years may be issued under the International Business Activity Act. Corporate income tax refunds were $3 million (2022: $10 million).

Property tax revenue was recorded net of home owner grants of $892 million (2022: $878 million).

²Oil and gas royalty revenues are reported after adjustments for various royalty deduction programs such as producer cost of service allowances, deep well, marginal, ultra marginal, low production, net profit, new pool discovery and road construction. Deductions allowable in the calculation of royalty revenue were $1,671 million (2022: $1,517 million). Natural resource revenue includes mining taxes of $801 million (2022: $660 million) and logging taxes of $403 million (2022: $154 million).

The province offers credits for certain costs incurred by producers including the deep well, road and summer drilling programs. Deep well credits of $2,215 million (2022: $2,838 million), road credits of $10 million (2022: $14 million) and summer drilling credits of $3 million (2022: $3 million) have been incurred by producers and will reduce future natural gas royalties payable when wells go into production.

³The revenue collected for and transferred to Crown corporations, agencies and other entities has not been included in the Consolidated Revenue Fund.

PROVINCE OF BRITISH COLUMBIA	133
PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Schedule of Comparison of Estimated Expenses to Actual Expenses

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Thousands
	Estimates		Other Authorizations			Total		Actual
	$		$			$		$
Special Offices, Ministries and Other Appropriations
Legislative Assembly		91,983					91,983		87,342
Officers of the Legislature		87,077		7,553			94,630		91,301
Office of the Premier		14,692					14,692		14,194
Agriculture and Food		107,021		185,577			292,598		292,490
Attorney General		1,374,030		(566,218	)		807,812		804,982
Children and Family Development		1,742,045		1,555			1,743,600		1,742,821
Citizens’ Services		656,645		111,733			768,378		767,542
Education and Child Care		8,217,449		16,581			8,234,030		8,220,031
Emergency Management and Climate Readiness				820,946			820,946		818,323
Energy, Mines and Low Carbon Innovation		111,959		287,992			399,951		399,038
Environment and Climate Change Strategy		367,946		213,280			581,226		574,292
Finance		1,221,177		2,870,621			4,091,798		4,048,429
Forests		832,516		357,567			1,190,083		1,181,461
Health		25,455,895		928,889			26,384,784		26,336,341
Housing				897,387			897,387		897,254
Indigenous Relations and Reconciliation		177,919		600,041			777,960		776,763
Jobs, Economic Development and Innovation		110,926		114,498			225,424		225,166
Labour		17,423		17,044			34,467		34,339
Mental Health and Addictions		24,602		172,983			197,585		197,585
Municipal Affairs		259,814		1,663,933			1,923,747		1,921,886
Post–Secondary Education and Future Skills		2,612,688		79,512			2,692,200		2,691,618
Public Safety and Solicitor General		1,393,726		(265,405	)		1,128,321		1,121,452
Social Development and Poverty Reduction		4,456,033		233,768			4,689,801		4,688,364
Tourism, Arts, Culture and Sport		173,385		254,878			428,263		427,233
Transportation and Infrastructure		955,980		1,088,382			2,044,362		2,043,188
Water, Land and Resource Stewardship		92,008		372,450			464,458		464,454
Management of Public Funds and Debt		1,361,388		(7,137	)		1,354,251		1,290,311
Contingencies (All Ministries) and New Programs1		4,848,000		(4,366,064	)		481,936		(9,098	)
Capital Funding		3,733,581					3,733,581		2,247,797
Commissions on Collection of Public Funds		1					1
Allowances for Doubtful Revenue Accounts		1					1
Tax Transfers		2,044,000		1,875,400			3,919,400		3,919,400
Electoral Boundaries Commission		2,194					2,194		1,476
Forest Practices Board		3,896					3,896		3,887
Total expense		62,548,000		7,967,746			70,515,746		68,321,662

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PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Schedule of Comparison of Estimated Expenses to Actual Expenses

for the Fiscal Year Ended March 31, 2023—Continued

(Unaudited)

	In Thousands
	Estimated			Other Authorizations			Total			Actual
	$			$			$			$
Summary of Appropriations
Voted expense		61,245,194			5,165,062			66,410,256			64,279,573
Statutory
Various Acts		850			1,508,656			1,509,506			1,468,656
Special Accounts		1,384,409			1,393,413			2,777,822			2,755,271
Inter–account transfers		(82,453	)		(99,385	)		(181,838	)		(181,838	)
Total expense by appropriation 2022/23		62,548,000			7,967,746			70,515,746			68,321,662
Total expense by appropriation 2021/22		58,306,000			2,054,738			60,360,738			58,716,114

¹ The budget for contingencies has been reallocated to ministries with approved access.

PROVINCE OF BRITISH COLUMBIA	135
PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Schedule of Financing Transaction Disbursements

for the Fiscal Year Ended March 31, 2023

(Unaudited)

	In Thousands
	Estimated		Other Authorizations			Total		Actual
	$		$			$		$
Special Offices, Ministries and Other Appropriations
All Ministries				281,271			281,271		281,271
Legislative Assembly		9,473					9,473		4,997
Officers of the Legislature		2,096					2,096		875
Office of the Premier		3					3
Agriculture and Food		1,229					1,229		910
Attorney General		15,087					15,087		9,753
Children and Family Development		1,000					1,000		828
Citizens’ Services		466,510					466,510		328,722
Education and Child Care		3					3		1
Emergency Management and Climate Readiness		495					495		14
Energy, Mines and Low Carbon Innovation		44,586		3,869			48,455		48,423
Environment and Climate Change Strategy		52,914					52,914		33,762
Finance		1,916,002		160,744			2,076,746		2,005,636
Forests		188,411					188,411		138,507
Health		30		11,002			11,032		11,032
Indigenous Relations and Reconciliation		135,263		12,646			147,909		135,507
Jobs, Economic Development and Innovation		3					3		1
Labour		3					3
Mental Health and Addictions		3					3
Municipal Affairs		2,354					2,354		1,519
Post–Secondary Education and Future Skills		504					504		54
Public Safety and Solicitor General		3,169					3,169		2,407
Social Development and Poverty Reduction		1,822					1,822
Tourism, Arts, Culture and Sport		603					603		142
Transportation and Infrastructure		5,005					5,005		2,137
Water, Land and Resource Stewardship		245					245		189
Contingencies (All Ministries) and New Programs		125,150		(11,002	)		114,148
Total financing transaction disbursements		2,971,963		458,530			3,430,493		3,006,687
Summary of Appropriations
Loans, investments and other requirements		689,089		347,695			1,036,784		929,040
Revenue collected for, and transferred to, other entities		1,528,200		110,835			1,639,035		1,619,937
Capital expenditures		754,674					754,674		457,710
Total financing transactions by appropriation		2,971,963		458,530			3,430,493		3,006,687

136	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Consolidated Revenue Fund

Schedule of Write–offs, Extinguishments and Remissions

for the Fiscal Year Ended March 31, 2023

(Unaudited)

			In Millions
	Assets,
	Debts and		Debts and
	Obligations		Obligations		Remissions
	Written Off		Extinguished		Made
	$		$		$
Ministry
Ministry of Attorney General		1
Ministry of Children and Family Development		3
Ministry of Citizens’ Services		5
Ministry of Energy, Mines and Low Carbon Innovation						3
Ministry of Finance		216		14		9
Ministry of Health		6
Ministry of Jobs, Economic Development and Innovation		1
Ministry of Public Safety and Solicitor General		9
Ministry of Social Development and Poverty Reduction		4		7
Total 2022/23		245		21		12
Total 2021/22		69		20		4

This statement includes amounts authorized by sections 17, 18 and 19 of the Financial Administration Act. Amounts authorized for write–off, forgiveness or remission by other statutes are not shown separately in these financial statements.

This schedule is produced as required under Section 9(2)(d)(ii),(iii) and (iv) of the Budget Transparency and Accountability Act.

Provincial Debt

Summary

(Unaudited)

The following unaudited Provincial Debt Summary information is intended to provide additional information to financial statement readers.

The accounting policies applied to this unaudited information are different, in some cases, from the Budget Transparency and Accountability Act (BTAA); which requires generally accepted accounting principles (GAAP) for senior governments in Canada, supported by regulations of Treasury Board under the BTAA, and that are followed for the audited Summary Financial Statements. The Provincial Debt Summary figures include guaranteed debt in the calculation of total debt; calculate debt, interest costs and revenue as if the modified equity enterprises were consolidated on a line–by–line basis; and do not include adjustments made to convert debt denominated in foreign currency to the exchange rate as at the fiscal year–end.

 

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

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PROVINCE OF BRITISH COLUMBIA	139
PUBLIC ACCOUNTS 2022/23

Overview of Provincial Debt

(Unaudited)

The provincial government, its Crown corporations, agencies and government organizations incur debt to fund operations and finance capital projects.

Provincial debt is reported using two basic classifications: (1) taxpayer–supported debt; and (2) self–supported debt.

Taxpayer–supported Debt—includes government direct debt, which is incurred for government operating and capital purposes, the debt of Crown corporations and agencies, school districts, universities, colleges, institutes and health organizations that require operating or debt service subsidies from the provincial government and are fully consolidated in the Summary Financial Statements. The BC Transportation Financing Authority is an example of a taxpayer–supported Crown corporation.

Self–supported Debt—includes the debt of commercial Crown corporations and agencies as well as the Warehouse Borrowing Program. Commercial Crown corporations and agencies generate sufficient revenues to cover interest costs and repay principal and may pay dividends to the province. The British Columbia Hydro and Power Authority is an example of a commercial Crown corporation. The Warehouse Borrowing Program takes advantage of borrowing opportunities in advance of requirements. Eventually, this debt is allocated to the province or Crown corporations and agencies. In the interim, the funds are invested at market rates.

The Finance Statutes (Deficit Authorization and Debt Elimination) Amendment Act, 2009 requires that effective April 1, 2013, any increase in cash and cash equivalents in the Consolidated Revenue Fund must be applied to reduce or eliminate any provincial government direct operating debt. Supplementary estimates may not be presented to the Legislative Assembly if the most recent quarterly report includes a forecast that there will be provincial government direct operating debt at the end of the fiscal year to which the quarterly report applies. Under the Economic Stabilization (COVID–19) Act, 2020, this section of the Act does not apply for fiscal years 2020/21–2023/24.

The following provincial debt summary provides additional detailed information and related key indicators and benchmarks to allow a more informed assessment of the debt totals. A reconciliation is also provided to explain the differences between the Summary of Provincial Debt and the Summary Financial Statements.

The total provincial net debt as at March 31, 2023 was $89,426 million, which consists of $88,896 million in the Summary Financial Statements and excludes the unrealized foreign exchange loss of $472 million of hedged foreign denominated debt translated to the March 31, 2023 exchange rates, in addition to $1,508 million of debt included as part of equity in self–supported Crown corporations and agencies and $15 million of guaranteed debt less $521 million of sinking fund investments.

140	PROVINCE OF BRITISH COLUMBIA
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Provincial Debt 

as at March 31, 2023
(Unaudited)

The accumulated provincial net debt of $89,426 million has been incurred for various purposes as shown in Chart 1 below. Over the years, the proceeds from borrowings have contributed to economic development in the province and have provided resources to deliver health, education and social programs, and transportation infrastructure.

At March 31, 2023, taxpayer–supported net debt totalled $59,934 million including government capital ($36,538 million), BC Transportation Financing Authority ($18,992 million), Health Authorities and Hospital Societies ($1,983 million), social housing ($1,241 million), post–secondary institutions ($910 million) and other debt ($270 million). Other debt is comprised mainly of debt related to BC Pavilion Corporation, BC Transit, InBC Investment Corporation, and school districts.

At March 31, 2023, self–supported debt totalled $29,492 million including debt of commercial Crown corporations and agencies: British Columbia Hydro and Power Authority ($26,707 million), Columbia Basin power projects ($1,298 million), commercial subsidiaries of certain post–secondary institutions ($685 million), Columbia Power Corporation ($270 million), British Columbia Lottery Corporation ($201 million), British Columbia Liquor Distribution Branch ($242 million), and debt of other government business enterprises ($89 million). Debt of other government business enterprises is debt related to Columbia Basin Trust’s share of real estate investment joint ventures, and the Insurance Corporation of British Columbia.

Chart 1 – Provincial debt as at March 31, 2023

In Millions/Percent of Total

 

PROVINCE OF BRITISH COLUMBIA	141
PUBLIC ACCOUNTS 2022/23

Change in Provincial Debt¹ 

(Unaudited)

Provincial debt decreased by $1,240 million in 2022/23 when compared to the prior year. This includes a decrease in taxpayer–supported debt of $2,407 million and an increase in self–supported debt of $1,167 million. Warehouse Program debt was nil at fiscal year–end. Chart 2 below shows the change in provincial debt for the year ended March 31, 2023.

Taxpayer–supported Debt—Decreased by $2,407 million due to a reduction of debt of $7,233 million for government operating requirements. Offset by $4,377 million for BC Transportation Financing Authority, $267 million for social housing, and $182 million for Other, which is comprised of: $144 million for Health Authorities and Hospital Societies, $51 million to fund government capital requirements, offset by a net $13 million reduction in other taxpayer–supported entities.

Self–supported Debt—Increased by $1,167 million due to new capital financing requirements of $1,096 million for British Columbia Hydro and Power Authority, $70 million for post–secondary institutions’ subsidiaries and a net increase of $1 million in other commercial Crown corporations and agencies.

Chart 2 – Change in provincial debt for the year ended March 31, 2023

 

¹Includes gross new borrowings plus changes in sinking fund balances less debt maturities.

142	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Reconciliation of Summary Financial Statements’ Deficit (Surplus)

to Change in Taxpayer–supported Debt and Total Debt
for the Fiscal Year Ended March 31, 2023
(Unaudited)

	In Millions
	2023			2022
	$			$
(Surplus) for the year		(704	)		(1,265	)
Taxpayer–supported debt decreased by:
Non–cash expenses included in (surplus)		(3,287	)		(2,808	)
Accounts receivable, accounts payable and other working capital net changes		(5,766	)		(3,111	)
Foreign exchange adjustments		(416	)
		(9,469	)		(5,919	)
Taxpayer–supported debt increased by:
Self–supported Crown corporation and agency earnings in excess of contributions to the Consolidated Revenue Fund		301			2,943
Tangible capital asset net acquisitions		6,572			5,955
Net increases in loans, advances and investments		893			877
		7,766			9,775
Net (decrease) increase in taxpayer–supported debt		(2,407	)		2,591
Taxpayer–supported debt—beginning of year		62,341			59,750
Taxpayer–supported debt—end of year		59,934			62,341
Self–supported debt		29,492			28,325
Total debt1		89,426			90,666

Reconciliation of Total Debt to Summary Financial Statements’ Debt
as at March 31, 2023

(Unaudited)

	In Millions
	2023			2022
	$			$
Total debt		89,426			90,666
Debt included as part of equity in self–supported Crown corporations and agencies		(1,508	)		(1,386	)
Contingent liabilities for debt of individuals and organizations that have been guaranteed by the province		(15	)		(16	)
Sinking fund investments		521			510
Foreign exchange adjustments.		472
Summary Financial Statements’ debt.		88,896			89,774
Comprised of:
Taxpayer–supported debt		60,564			62,565
Self–supported debt		28,332			27,209
Summary Financial Statements’ debt		88,896			89,774

¹See Summary of Provincial Debt, page 149.

PROVINCE OF BRITISH COLUMBIA	143
PUBLIC ACCOUNTS 2022/23

Change in Provincial Debt,
Comparison to Budget
(Unaudited)

Provincial debt decreased by $1,240 million compared to a budgeted increase of $14,765 million resulting in a $16,005 million decrease from budget net of the $1,000 million forecast allowance. Chart 3 below shows the difference between the actual change in provincial debt and the budgeted change by major category.

Taxpayer–supported debt decreased by $2,407 million compared to a budgeted increase of $11,134 million. The $13,541 million decrease from budget reflects the lower than forecasted borrowing for government operating requirements ($10,411 million), government capital ($4,035 million), Social Housing ($691 million), and other taxpayer–supported entities ($58 million). These decreases were offset by higher than forecasted borrowing for post–secondary institutions ($22 million), BC Transportation Financing Authority ($1,480 million), and Health Authorities and Hospital Societies ($152 million).

Self–supported debt increased by $1,167 million compared to a budgeted increase of $2,631 million. The $1,464 million decrease from budget is due to lower than forecasted borrowing for British Columbia Hydro and Power Authority ($1,583 million), other self–supporting entities, primarily the Insurance Corporation of British Columbia ($26 million), Columbia Basin power projects ($2 million), and British Columbia Lottery Corporation ($1 million). These decreases were partially offset by higher than forecasted borrowing for commercial subsidiaries of certain post–secondary institutions ($110 million), British Columbia Liquor Distribution Branch ($29 million), and Columbia Power Corporation ($9 million).

Chart 3 – Change in provincial debt¹, comparison to budget for the year ended March 31, 2023

 

¹The change in forecast allowance is not included in this chart.

144	PROVINCE OF BRITISH COLUMBIA
	PUBLIC ACCOUNTS 2022/23

Interprovincial Comparison of Taxpayer–supported Debt
as a Percentage of Gross Domestic Product
(Unaudited)

Chart 4 below shows the ratio of each province’s taxpayer–supported debt as a percentage of their gross domestic product (GDP). The ratio of a province’s taxpayer–supported debt relative to its GDP highlights the ability of a province to service its debt load. This ratio is often used by investors and credit rating agencies when assessing a province’s investment quality. According to the most recent data published by Moody’s Investors Service Inc. (Moody’s), British Columbia’s taxpayer–supported debt ratio is one of the lowest in Canada and this translates into a strong credit rating and relatively low debt servicing costs.

Chart 4 – Interprovincial comparison of taxpayer–supported debt as a percentage of GDP

Percent of GDP at March 31

 

Source: Moody’s Investors Service Inc. as at July 18, 2023

British Columbia’s result as per Ministry of Finance’s actuals; Moody’s result for British Columbia as at March 31, 2022 was 17.1%.

PROVINCE OF BRITISH COLUMBIA	145
PUBLIC ACCOUNTS 2022/23

Interprovincial Comparison of Taxpayer–supported Debt
Service Costs as a Percentage of Revenue
(Unaudited)

Chart 5 shows the ratio (interest bite) of each province’s taxpayer–supported debt servicing costs as a percentage of revenue. The interest bite indicates how much of each dollar of provincial revenue is used to pay for taxpayer–supported debt service costs. According to the most recent data published by Moody’s, British Columbia has one of the lowest taxpayer–supported debt service costs as a percentage of revenue of all provinces.

Chart 5 – Interprovincial comparison of taxpayer–supported debt service costs as a percentage of revenue

Percent of revenue at March 31

 

Source: Moody’s Investors Service Inc. as at July 18, 2023

British Columbia’s result as per Ministry of Finance’s actuals; Moody’s result for British Columbia as at March 31, 2022 was 2.6%.

Moody’s definition of taxpayer–supported debt is modestly different from the definition used by the Ministry of Finance. The financial community has not agreed upon a definition for taxpayer–supported debt. The definition used by Moody’s is the closest to that employed by the ministry, however there are small differences. The value of presenting Moody’s debt indicators is that it provides an interprovincial comparison from a third party source, which is helpful for readers to understand the province’s relative performance and ranking.

More comprehensive information on the debt of the province and its Crown corporations and agencies is provided on the Debt Management Branch website. This detailed information can assist readers in assessing the province’s debt position. The website is available online at: www.fin.gov.bc.ca/PT/dmb/index.shtml.

PROVINCE OF BRITISH COLUMBIA
PUBLIC ACCOUNTS 2022/23

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Independent Auditor’s Report

To the Minister of Finance, Province of British Columbia

Opinion

I have audited the accompanying debt-related statements of the Government of the Province of British Columbia (“government”), which comprise the summary of provincial debt as at March 31, 2023, the key indicators of provincial debt and the summary of performance measures for the year then ended, and a summary of significant accounting policies and other explanatory information.

In my opinion, the summary of provincial debt as at March 31, 2023, the key indicators of provincial debt and the summary of performance measures for the year then ended are prepared, in all material respects, in accordance with the basis of accounting as described in the notes to the debt-related statements.

Basis for Opinion

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

I conducted my audit in accordance with Canadian generally accepted auditing standards. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the debt-related statements section of my report. I am independent of the government in accordance with the ethical requirements that are relevant to my audit of the debt-related statements in Canada, and I have fulfilled my other ethical responsibilities in accordance with these requirements.

Emphasis of matter – basis of accounting

I draw attention to the notes to the debt-related statements, which describe the basis of accounting. Through the debt-related statements, the government reports to the Legislative Assembly on its debt management by presenting five years of information on provincial debt and debt indicators, and compares its actual results of performance measure to its target measures for the fiscal year ended March 31, 2023. As a result, the debt-related statements may not be suitable for another purpose. My opinion is not modified in respect of this matter.

Other accompanying information

Government is responsible for the other information in the annual Public Accounts.

My opinion on the debt-related statements does not cover other information in the Public Accounts that accompanies the debt-related statements and, except for my independent auditor’s report on the Summary Financial Statements, I do not express any form of assurance conclusion thereon.

In connection with my audit of the debt-related statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the debt-related statements or my knowledge obtained during the audit or otherwise appears to be materially misstated.

Prior to the date of my auditor’s report, I obtained a copy of the Public Accounts. If, based on the work I have performed on the other information, I conclude that there is a material misstatement therein, I am required to report that fact in this auditor’s report. Other than the material misstatements described in the other accompanying information of my independent auditor’s report on the Summary Financial Statements, I have nothing to report in this regard.

MINISTER OF FINANCE
Independent Auditor’s Report

Government’s Responsibilities for the Debt-Related Statements

Government is responsible for determining the appropriateness of the stated basis of accounting as described in the notes to the debt-related statements and for the preparation of the debt-related statements in accordance with the stated basis of accounting. Government is also responsible for such internal control as government determines is necessary to enable the preparation of the debt-related statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibilities for the Audit of the Debt-Related Statements

My objectives are to obtain reasonable assurance about whether the debt-related statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decision of users taken on the basis of the debt-related statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, I exercise professional judgment and maintain professional skepticism throughout the audit. I also:

• Identify and assess the risks of material misstatement of the debt-related statements, whether due to fraud or error; design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit 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 internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by government.

• Evaluate the overall presentation, structure and content of the debt-related statements, and whether it represents the underlying transactions and events in a manner that complies with the basis of accounting described in the notes to the debt-related statements.

I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

/s/ Michael A. Pickup

Michael A. Pickup, FCPA, FCA
Auditor General of British Columbia

Victoria, British Columbia, Canada

August 22, 2023

 

PROVINCE OF BRITISH COLUMBIA	149
PUBLIC ACCOUNTS 2022/23

Summary of Provincial Debt¹

as at March 31

	In Millions
	2023		2022		2021		2020		2019
		$		$		$		$		$
Taxpayer–supported Debt
Provincial government direct operating
Provincial government operating				7,233		8,746
Capital
K–12 education2		10,893		11,342		10,529		9,757		8,885
Post–secondary institutions2		5,502		5,732		5,426		4,917		4,607
Health facilities2		8,286		8,223		7,484		6,705		6,173
Ministries general capital		4,549		4,087		3,702		3,133		2,363
Transportation2		5,391		5,401		5,401		5,401		5,401
Social housing3		1,648		1,424		1,062		805		619
Other4		269		278		268		252		242
Total Capital		36,538		36,487		33,872		30,970		28,290
Total provincial government		36,538		43,720		42,618		30,970		28,290
Taxpayer–supported entities
British Columbia Pavilion Corporation		126		129		132		135		138
British Columbia Transit		53		56		60		65		73
BC Transportation Financing Authority		18,992		14,615		13,321		12,193		11,293
Health Authorities and Hospital Societies		1,983		1,839		1,875		1,802		1,795
InBC Investment Corporation		21		19		37		45		70
Post–secondary institutions		910		922		882		753		763
School districts		21		25		24		18		19
Social housing3		1,241		974		770		222		225
Other4		49		42		31		26		15
Total taxpayer–supported entities		23,396		18,621		17,132		15,259		14,391
Total taxpayer–supported debt		59,934		62,341		59,750		46,229		42,681
Self–supported Debt
Commercial Crown corporations and agencies
British Columbia Hydro and Power Authority		26,707		25,611		24,650		23,238		22,064
British Columbia Lottery Corporation		201		195		228		233		100
Columbia Basin Trust joint ventures5		1,298		1,319		1,349		1,387		418
Columbia Power Corporation		270		266		271		276		282
British Columbia Liquor Distribution Branch.		242		230		233		210
Post–secondary institutions’ subsidiaries6		685		615		520		504		387
Other7		89		89		99		84		30
Total self–supported debt		29,492		28,325		27,350		25,932		23,281
Total provincial debt		89,426		90,666		87,100		72,161		65,962

¹Debt is after deductions of sinking funds and unamortized discounts, and excludes unrealized foreign exchange (gains)/losses and accrued interest. 

²Represents government direct debt incurred for capital financing of education and health facilities and public transit infrastructure. 

³Includes the debt of the British Columbia Housing Management Commission and the Provincial Rental Housing Corporation. 

⁴Includes debt of other taxpayer–supported Crown corporations and agencies and the fiscal agency loans to local governments. Also includes reconstruction loan program guarantees, student loan guarantees, loan guarantees to agricultural producers, guarantees under economic development. 

⁵Debt related to Columbia Basin Trust joint ventures with Columbia Power Corporation (Brilliant Power Corporation, Brilliant Expansion Power Corporation, Arrow Lakes Power Corporation, and Waneta Expansion Power Corporation). 

⁶Includes debt of Heritage Realty Properties Ltd., SFU Community Trust, UBC Property Investments Ltd, and Vancouver Island Technology Park. 

⁷Includes Columbia Basin Trust’s share of real estate investment joint ventures’ debt and Insurance Corporation of British Columbia.

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Summary of Provincial Debt 

The debt–related statements are prepared using financial information that supports the government’s Summary Financial Statements, which are prepared in accordance with the Budget Transparency and Accountability Act (BTAA), which requires generally accepted accounting principles (GAAP) for senior governments in Canada, supported by regulations of Treasury Board. However, in the debt–related statements, there are some differences in the methods of compilation and presentation compared to generally accepted accounting principles. In the debt–related statements, debt is calculated net of sinking fund assets, includes debt directly incurred by modified equity enterprises and other commercial subsidiaries of taxpayer–supported entities, includes debt incurred by others outside the government reporting entity where there is provincial guarantee as to the payment of principal and interest, and does not include adjustments made to convert debt denominated in foreign currency to the exchange rate as at the fiscal year–end. Also, total provincial revenue and interest costs include the gross revenue and interest costs of modified equity enterprises, and total provincial interest costs are net of sinking fund earnings.

Provincial government general capital 

In February 2009, government tabled the Finance Statutes (Deficit Authorization and Debt Elimination) Amendment Act, 2009, which prohibited spending on supplementary estimates until operating debt was eliminated. Historically, government direct operating debt included debt attributed to financing ministry capital expenditures, in addition to borrowing for operating deficits and working capital needs. In accordance with the amending legislation, beginning in 2009/10, debt attributed to amounts spent on ministry capital are reported as “Provincial government general capital” and reported separately from direct operating debt for deficit financing. Amounts attributed to ministry capital spending prior to 2008/09 are disclosed as a component of direct operating debt for compliance with the amended legislation. These segregated debt disclosures are consistent with government’s policy of paying down operating debt before other types of debt.

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Key Indicators of Provincial Debt¹

for the Fiscal Years Ended March 31

	2023				2022		2021		2020		2019
	Budget  Estimate		Actual		Actual		Actual		Actual		Actual
Debt to Revenue (percent)
Total provincial		124.5		90.6		104.3		115.1		95.9		89.5
Taxpayer–supported		110.9		74.3		90.8		101.2		80.6		75.0
Debt per Capita ($)2
Total provincial		19,834		16,813		17,386		16,919		14,230		13,214
Taxpayer–supported		13,823		11,268		11,954		11,606		9,116		8,550
Debt to GDP (percent)3
Total provincial		28.7		23.0		26.1		29.5		23.6		22.3
Taxpayer–supported		20.0		15.4		17.9		20.2		15.1		14.5
Interest Bite (cents per dollar of revenue)4
Total provincial		3.5		3.2		3.3		3.7		3.8		3.8
Taxpayer–supported		3.0		2.5		2.8		3.1		3.1		3.2
Interest Costs ($ millions)
Total provincial		2,967		3,114		2,848		2,817		2,872		2,786
Taxpayer–supported		2,012		2,030		1,896		1,832		1,807		1,793
Interest Rate (percent)5
Taxpayer–supported		3.0		3.3		3.1		3.5		4.1		4.2
Revenue Factor for Key Indicators ($ millions)
Total provincial6		84,672		98,655		86,903		75,691		75,283		73,734
Taxpayer–supported7		66,226		80,647		68,658		59,033		57,386		56,881

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Key Indicators of Provincial Debt¹

for the Fiscal Years Ended March 31—Continued

	2023				2022		2021		2020		2019
	Budget Estimate		Actual		Actual		Actual		Actual		Actual
Total Debt ($ millions)
Total provincial		105,431		89,426		90,666		87,100		72,161		65,962
Taxpayer–supported8		73,475		59,934		62,341		59,750		46,229		42,681
Provincial GDP ($ millions)9		367,966		389,129		347,653		295,282		306,272		295,316
Population (thousands at July 1)10		5,316		5,319		5,215		5,148		5,071		4,992

¹Figures for prior years have been restated to conform with the presentation used for 2022/23 and to include the effects of changes in underlying data. 

²The ratio of debt to population (e.g., debt at March 31, 2023 divided by population at July 1, 2022). 

³The ratio of debt outstanding at fiscal year end to provincial nominal gross domestic product (GDP) for the calendar year ending in the fiscal year (e.g., debt at March 31, 2023 divided by 2022 GDP) 

⁴The ratio of interest costs (less sinking fund interest) to revenue. Figures include capitalized interest expense in order to provide a more comparable measure to outstanding debt. 

⁵Weighted average of all outstanding debt issues. 

⁶Includes revenue less earnings related to enterprises (sinking fund earnings, loan interest and net earnings), plus revenue of all enterprises. 

⁷Excludes revenue of government enterprises, but includes dividends from enterprises paid to the Consolidated Revenue Fund. 

⁸Excludes debt of commercial Crown corporations and agencies, and funds held under the province’s warehouse borrowing program. 

⁹Nominal GDP for the calendar year ending in the fiscal year (e.g. GDP for 2022 is used for the fiscal year ended March 31, 2023). As nominal GDP for the calendar year ending 2022 is not available, the 2022 GDP projected in the February 2023 Budget and Fiscal Plan 2023/24 – 2025/26 has been used for the fiscal year ended March 31, 2023 for demonstration purposes. Preliminary GDP figures are presented as published for the year noted. 

¹⁰Population at July 1st within the fiscal year (e.g. population at July 1, 2022 is used for the fiscal year ended March 31, 2023). Preliminary population figures are presented as published for the year noted per the February 2023 Budget and Fiscal Plan 2023/24 – 2025/26.

Summary of Performance Measures

for the Fiscal Year Ended March 31, 2023

	2023			2023			2022
	Target2			Actual			Actual
Taxpayer–supported debt to GDP ratio1		20.0	%		15.4	%		17.9	%
Taxpayer–supported debt service costs as a percentage of revenue		3.0	%		2.5	%		2.8	%

¹These performance measures, among others, are key indicators on which credit rating agencies rely to determine the province’s credit rating. 

²The target amounts are from page 182 of the Budget and Fiscal Plan 2022/23–2024/25.

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Definitions
(Unaudited)

Consolidated Revenue Fund—includes the taxpayer–supported activities of the General Fund and special funds of the government through which the government delivers central government programs. It does not include the activities of government operated through Crown corporations and agencies or the school districts, universities, colleges, institutes and health organizations (SUCH) sector.

Consolidation—the methods used to combine the results of Crown corporations and agencies and the SUCH sector entities with the Consolidated Revenue Fund. The two methods used are: 

(i)  Full or Proportional Consolidation—the accounts of the Crown corporation, agency or SUCH sector entity are adjusted to a basis consistent with the accounting policies of the government. The operating result and financial position of the Crown and SUCH entities are combined with those of the Consolidated Revenue Fund on a line–by–line basis. Inter–entity accounts and transactions are eliminated upon consolidation. Proportional consolidation differs from full consolidation in that only the government’s portion of operating and financial results of a joint venture is combined with those of the Consolidated Revenue Fund on a line–by–line basis. 

(ii) Modified Equity Consolidation—the original investment of the government in the Crown corporation, agency or SUCH sector entity is initially recorded at cost and adjusted annually to include the net earnings/losses and other net equity changes of the entity. There is no adjustment to conform to government accounting policies. Since the government ensures the ongoing activities of self–supported Crown corporations and agencies, full account is taken of losses in these entities, even when cumulative losses exceed the original investment. Accounts and transactions between self–supported entities are not eliminated; however, profit elements included in such transactions, including certain increases in contributed surplus, are eliminated.

Debt has a variety of meanings: 

(i)  Gross debt—the par value of the debt, unamortized discount and premiums, and unrealized foreign exchange gains or losses. 

(ii) Net debt—gross debt less sinking fund investments. 

(iii)  Provincial debt—net debt plus guaranteed debt and debt directly incurred by modified equity entities.

Deficit—the meaning is dependent upon the statement to which it applies: 

(i)Consolidated Statement of Financial Position: Accumulated Deficit—the amount by which the total liabilities of the government exceeds its total assets. 

(ii)Consolidated Statement of Operations: Annual Deficit—the amount by which the total annual expenses for the operating year exceed total annual revenues (see “Surplus” definition).

Entitlement—a government transfer that must be made if the recipient meets specified eligibility criteria. Entitlements are non–discretionary in the sense that both eligibility criteria and the amount of the payment are prescribed in a statute or regulation.

Financial assets—assets on hand at the end of the accounting period, including cash and assets that are readily convertible into cash and are not intended for consumption in the normal course of activities. These assets could be liquidated to discharge existing liabilities or finance future operations. Financial assets could include sinking fund investments held to pay debt at maturity.

Government business enterprise—a government organization that has all the following characteristics: 

(i)is a separate legal entity with the power to contract in its own name and that can sue or be sued; 

(ii) has been delegated the financial and operational authority to carry on a business; 

(iii)sells goods and/or services to individuals and organizations outside the government reporting entity as its principal activity; and 

(iv)can, in the normal course of its operation, maintain its operations and meet its liabilities from revenue received from sources outside the government reporting entity.

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Definitions—Continued
(Unaudited)

Government partnership—a contractual arrangement between the government and a party or parties outside the government reporting entity that has all the following characteristics: 

(i) the partners cooperate toward achieving significant, clearly defined common goals; 

(ii) the partners make a financial investment in the government partnership; 

(iii) the partners share control of decisions related to the financial and operating policies of the government partnership on an ongoing basis; and 

(iv) the partners share, on an equitable basis, significant risks and benefits associated with the operation.

Government transfers—transfer of money from government to an individual, organization or another government from which the government making the transfer does not: 

(i) receive any goods or services directly in return; 

(ii) expect to be repaid in the future; nor 

(iii)expect a financial return.

Grants—a government transfer made at the sole discretion of the government. The government has the discretion to decide whether or not to make the grant, any conditions to be complied with, the amount of the grant and the recipient of the grant.

Net liabilities—the amount by which the total liabilities of the government exceed its total financial assets. The separate calculation of this number on the Consolidated Statement of Financial Position is unique to financial statements for Canadian senior governments. This calculation excludes non–financial assets such as buildings and prepaid expenses.

Other comprehensive income (OCI)—is made up of certain unrealized gains and losses of self–supported Crown corporations that are not reported in their statement of operations, but are reported in their statement of financial position. These unrealized gains and losses will be recognized in the statement of operations when they become realized gains and losses.

Provincial government direct debt—combines the government direct operating debt and the debt incurred to finance education, health facilities and public transit. This combined portfolio represents the debt for which the government has direct responsibility for the associated debt service costs.

Self–supported Crown corporations and agencies—all Crown corporations and agencies that are accountable for the administration of their financial affairs and resources either to a minister of the government or directly to the legislature and are owned or controlled by the government. In addition, they must also carry on a business that sells goods and/or services to persons outside the government reporting entity as their principal activity and maintain operations and meet liabilities from revenue received outside the government reporting entity in the normal course of operations. This also includes the government’s interest in government business enterprises.

Sinking funds—a pool of cash and investments earmarked to provide resources for the redemption of debt.

Summary accounts—the financial position and operating result of the government reporting entity including the Consolidated Revenue Fund, Crown corporations, agencies and SUCH sector entities; the amounts represented by the Summary Financial Statements of the government.

Surplus—meaning is dependent upon the statement to which it applies: 

(i)Consolidated Statement of Financial Position: the accumulated surplus is the amount by which the total assets of the government exceeds its total liabilities. 

(ii)Consolidated Statement of Operations: the annual surplus is the amount by which the total annual revenues for the operating year exceed total annual expenses (see “Deficit” definition).

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Definitions—Continued
(Unaudited)

Taxpayer–supported Crown corporations and agencies and SUCH sector entities—all Crown corporations and agencies and entities outside the Consolidated Revenue Fund that meet the criteria of control (by the province) as established by generally accepted accounting principles. In addition, they must not meet the criteria for being self–supported. This also includes the government’s interest in government partnerships that are not government business enterprises.

Transfers under agreements (including shared cost)—a government transfer that is a reimbursement of eligible expenditures pursuant to an agreement between the government and the recipient. The recipient usually spends the money first; however, the government has some input into how the money is spent.

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Acronyms
(Unaudited)

APAC	Accounting Policy Advisory Committee
BC Hydro	British Columbia Hydro and Power Authority
BCHMC	British Columbia Housing Management Commission
BTAA	Budget Transparency and Accountability Act
CPA	Chartered Professional Accountant
CRF	Consolidated Revenue Fund
GAAP	Generally accepted accounting principles (for senior governments as recommended by the Canadian Public Sector Accounting Board)
GDP	Gross domestic product
ICBC	Insurance Corporation of British Columbia
Moody’s	Moody’s Investors Service
PSAS	Public Sector Accounting Standards
SCBCTA	South Coast British Columbia Transportation Authority
SFU	Simon Fraser University
SUCH	School districts, universities, colleges, institutes and health organizations
UBC	The University of British Columbia