2012 Financial Statements - Workers' Compensation Board

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Workers’ Compensation Board – Alberta Statements of Cash Flows Year Ended December 31 ($ thousands) 2012 2011 OPERATING ACTIVITIES Cash inflows (outflows) from business operations Employer premiums Benefits to claimants and/or third parties on their behalf Administrative and other goods and services Injury reduction program Net cash from operating activities $ 1,174,681 (655,870) (206,476) (46,768) 265,567 $ 1,005,468 (644,982) (189,586) (45,628) 125,272 INVESTING ACTIVITIES Cash inflows (outflows) related to investment assets Interest income Dividend income Other investment income Gains on sale of investments Proceeds (payments) on settlement of derivatives Investment management expense Sale (purchase) of investments at cost Purchase of investments from reinvested income Cash outflows related to operating assets Property, plant and equipment Computer software Net cash from investing activities 84,442 47,474 30,674 146,980 38,097 (23,539) (389,358) (339,464) (7,150) (6,363) (418,207) 82,098 62,493 4,715 94,129 (61,091) (18,374) 137,957 (175,944) (9,078) (7,887) 109,018 FUNDING ACTIVITIES Cash outflows from funding activities Surplus distributions Net cash used for funding activities - - (227,847) (227,847) NET INCREASE (Decrease) IN CASH AND CASH EQUIVALENTS (152,640) 6,443 Cash and cash equivalents, beginning of year 368,548 362,105 CASH AND CASH EQUIVALENTS, END OF YEAR $ 215,908 $ 368,548 The accompanying notes are an integral part of these financial statements. 2012 FINANCIAL STATEMENTS and notes 47
Notes to the Financial Statements For the year ended December 31, 2012 with comparatives for the year ended December 31, 2011 (thousands of dollars unless stated otherwise) 1. REPORTING ENTITY The Workers’ Compensation Board – Alberta (WCB) is a provincial board created by legislation in 1918. As a statutory corporation, WCB administers the workers’ compensation system for the province of Alberta under the authority of the Workers’ Compensation Act (the Act). WCB’s corporate head office is located in Edmonton, Alberta, with operations exclusively within the province of Alberta. WCB’s legislated mandate is to provide disability benefits to workers who sustain injuries in the course of employment. 2. SIGNIFICANT ACCOUNTING POLICIES The following accounting policies have been applied in the preparation of the financial statements for all years presented, unless otherwise indicated. General Accounting Policies Basis of preparation These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). They comply, in all material respects, with IFRS as issued by the International Accounting Standards Board (IASB) in effect as at December 31, 2012. These financial statements have been prepared on a historic cost basis except for investments carried at fair value. The principal accounting policies applied in the preparation of the financial statements on an IFRS basis are set out below. Foreign currency translation WCB’s financial statements are presented in Canadian dollars, which is also the functional currency. All financial information presented has been rounded to the nearest thousand, unless otherwise stated. Monetary assets and liabilities denominated in foreign currency are translated into Canadian dollars at the exchange rate in effect at the date of the statement of financial position. Exchange differences arising from settlement of monetary items are included in income in the period in which they arise. Non-monetary assets and liabilities denominated in foreign currency are translated at the exchange rate in effect when those transactions occurred. Measurement uncertainty and use of accounting estimates The preparation of financial statements in accordance with IFRS requires the use of estimates that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting periods presented. Some accounting measurements require management’s best estimates, based on assumptions as at the financial statement date, that reflect the most probable set of economic conditions and planned courses of action. Employee benefit liabilities (Note 10), claim benefit liabilities (Note 11), and the Partnerships in Injury Reduction rebates accrual (Note 13) are the most significant items that are based on accounting estimates. Actual results could differ from the estimates determined by management in these financial statements. These differences, which may be material, could require adjustment in subsequent reporting periods. 48 WCB-Alberta 2012 Annual Report
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Page 13 and 14: 5. INVESTMENTS ACCOUNTING POLICY WC
Page 15 and 16: Reconciliation of Level 3 activity
Page 17 and 18: Interest rate risk Interest rate ri
Page 19 and 20: Securities lending risk WCB partici
Page 21 and 22: 8. INTANGIBLE ASSETS ACCOUNTING POL
Page 23 and 24: 10. EMPLOYEE BENEFITS ACCOUNTING PO
Page 25 and 26: Defined benefit plan liabilities ($
Page 27 and 28: Actuarial methodology and basis of
Page 29 and 30: Claims development The table that f
Page 31 and 32: 14. CLAIMS AND CLAIMS MANAGEMENT EX
Page 33 and 34: 16. INVESTMENT INCOME AND EXPENSE A
Page 35 and 36: Key management compensation The tab
Page 37 and 38: 19. SUPPLEMENTAL INFORMATION (a) Ca
Page 39 and 40: Appendix: Glossary Asset-liability

2012 Financial Statements - Workers' Compensation Board

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