Government Operations committee  Thank you, Mr. Chair. Members of the committee, good morning. Bonjour. My name is Mike Hawkes. I'm the chief financial officer at Public Works and Government Services Canada. I'm pleased to be here today with my colleague, John McBain, the associate assistant deputy minister of Real Property Branch, as part of your review of the supplementary estimates (B) that were tabled in the House on January 29, 2009.

Government Operations committee  That will be assessed through the process of the fairness monitor and it will be assessed by the Department of Finance.

Government Operations committee  It will be assessed in the overall assessment of options. It has to be assessed.

Government Operations committee  Yes, it does, Madam Chair. It appears in the Public Accounts statements, where there is a balance sheet for the Government of Canada. It will describe the crude value of the assets and the accumulated depreciation. It's very high-level; it's done for illustration purposes. As you know from the appearance and discussion you had at this committee before, the government is examining a full move to accrual-based expenditure management and accrual-based budgeting, and through different work studies they're doing, they plan to propose to the government, through the Treasury Board, how to proceed to implement that project.

Government Operations committee  All authorities to spend come from the government, so the receipt of the cash would be deposited, you're quite correct, to the consolidated revenue fund, and then the priority of the government would be decided as to what the use of that cash would be.

Government Operations committee  They are two totally different formulas. In terms of their value, we haven't finished calculating that yet. Some of the older assets in the group of nine are fully depreciated. I think there are at least two that are fully depreciated. Others are barely in the early stages of the depreciation.

Government Operations committee  The government has accounting standards that very closely match generally accepted accounting principles. The Comptroller General could explain them to you in great detail if you had him here.

Government Operations committee  We would recognize the sale of an asset, so it would be taken off the balance sheet. The accumulated depreciation would come off. The gain or loss on the sale would be reported against the equity. It's exactly the same as you'd do it in the private sector.

Government Operations committee  That's correct, the cash would go into the consolidated revenue fund.

Government Operations committee  We're still working through the details of how exactly we're going to apply it. There will be a proceeds of sale, so we'll record the proceeds of the sale. There will be the sale of assets, so the balance sheet would have to have the assets removed and the accumulated depreciation from those assets would be removed.

Government Operations committee  No, you're reading it perfectly clearly. What we have in this case is what I already identified in the base of the expenditures for PWGSC. A lot of the source of funds for that comes to us from other programs and organizations. In particular, we have some of those that are sunsetted—that is, the funding was provided to the government for a period of time to implement a series of priorities.

Government Operations committee  I can't either.

Government Operations committee  One way or the other, I'm not an expert in that field at all.

Government Operations committee  We did not consider it in this exercise.

Government Operations committee  This wasn't an issue that was raised during this particular reduction, but we are examining the issue of that split on a regular basis.