Download PDF (619 ko )FSST and CSST Financial Statements 2007

FSST and CSST 

Financial Statements 

2007

FSST and CSST 


2007

The Financial Statements of the Commission 

de la santé et de la sécurité du travail and the 

Fonds de la santé et de la sécurité du travail were 

produced by the Direction de la comptabilité 

et de la gestion de l’information. 

Translation 

Gillian Misener, C.Tr. 

Graphic design 

Jean Frenette Design 

Printing and distribution tracking 

Marie-France Pineault, 

Direction des communications 

Printing 

Imprimerie de la CSST 

If there is a discrepancy or contradiction between 

the French and English versions of the financial 

statements for the year ended December 31, 2007, 

the French version shall prevail. 

The FSST and CSST Financial Statements are also 

available on the Web site of the Commission de la 

santé et de la sécurité du travail at www.csst.qc.ca 

Reproduction authorized subject to acknowledgement 

of the source. 

© Commission de la santé et de la sécurité du travail 

du Québec 

Legal deposit – Bibliothèque et Archives nationales 

du Québec, 2007 

ISBN : 978-2-550-52668-1

Fonds de la santé 

et de la sécurité 

du travail 


for the Year Ended December 31, 2007 

The term “assessment” used in these financial statements 

refers to the amounts that employers contribute to the CSST 

and that are subsequently transferred to the FSST.

Trustee’s Report 

FSST Financial Statements 

The Commission de la santé et de la sécurité du travail (CSST), in its capacity as trustee of the 

Fonds de la santé et de la sécurité du travail (FSST), prepares the financial statements of this trust. 

It is responsible for the integrity and fairness of the data, including significant accounting judgements 

and estimates. This responsibility includes the choice of appropriate accounting policies in 

keeping with Canadian generally accepted accounting principles. The financial information contained 

elsewhere in the Annual Management Report is consistent with these financial statements. 

To fulfil its responsibilities regarding the integrity and fairness of the financial statements, CSST 

management exercises the internal controls necessary to provide users with reasonable assurance 

that the financial information is relevant and reliable and the assets are adequately safeguarded. 

The internal audit branch interne conducts periodic audits to ensure that the internal controls applied 

uniformly by the CSST are adequate and sustained. 

CSST management recognizes that it is responsible for administering its affairs in accordance with 

the statutes and regulations governing the FSST. 

In accordance with accepted actuarial practice, the CSST’s actuaries evaluate commitments to cover 

future payments under compensation programs for work-related injuries, the For a Safe Maternity 

program, administrative expenses and expenses for the financing of administrative tribunals regarding 

events that occurred on or before December 31, 2007, as they appear in the FSST’s financial 

statements, and report their conclusions to the CSST’s Audit Committee. 

The CSST’s Board of Directors is responsible for monitoring the manner in which management fulfils 

its responsibilities regarding financial information, and approves the financial statements. The CSST’s 

Audit Committee, whose members are not part of CSST management, assists the Board of Directors 

in this mandate. This Committee meets with CSST management and the Auditor General, reviews 

the financial statements and recommends the approval thereof to the Board of Directors. 

An actuary from the firm Eckler Ltée was appointed actuarial consultant to the CSST. His role is to 

conduct an independent examination of the actuarial value of the commitments outlined in the FSST’s 

financial statements. 

The Auditor General of Québec has audited the financial statements of the FSST in accordance with 

Canadian generally accepted auditing standards. The Auditor’s report sets out the nature and scope 

of this audit and expresses the Auditor’s opinion. The Auditor General may, without any restriction, 

meet with the audit committee to discuss all matters concerning the audit. 

For the Commission de la santé et de la sécurité du travail, 

trustee of the Fonds de la santé et de la sécurité du travail 

Luc Meunier 

Chairman of the Board and Chief Executive Officer 

André Beauchemin 

Vice-President, Finance 

Québec City, Canada, March 24, 2008 

4

Auditor’s Report 

To the National Assembly 

I have audited the balance sheet of the Fonds de la santé et de la sécurité du travail (FSST) as at 

December 31, 2007 and the income statements, accumulated (deficits) surpluses and cash flows for 

the year then ended. These financial statements are the responsibility of the management of the 

Commission de la santé et de la sécurité du travail, in its capacity as trustee. My responsibility is 

to express an opinion on these financial statements based on my audit. 

I conducted my audit in accordance with Canadian generally accepted auditing standards. These 

standards require that I plan and perform an audit to obtain reasonable assurance whether the financial 

statements are free of material misstatement. An audit includes examining, on a test basis, 

evidence supporting the amounts and disclosures in the financial statements. An audit also includes 

assessing the accounting principles used and significant estimates made by management, as well as 

evaluating the overall financial statement presentation. 

In my opinion, these financial statements present fairly, in all material respects, the financial 

position of the FSST as at December 31, 2007 and the results of its operations and its cash flows 

for the year then ended in accordance with Canadian generally accepted accounting principles. 

As required by the Auditor General Act (R.S.Q., chapter V-5.01), I report that, in my opinion, these 

principles have been applied on a basis consistent with that of the previous year. 


Renaud Lachance, CA 

Auditor General of Québec 


5

Actuarial Report regarding the Commitments 

of the Fonds de la santé et de la sécurité du travail 

as at December 31, 2007 


We have evaluated the actuarial liability of the Fonds de la santé et de la sécurité du travail (FSST) 

for the purpose of establishing its balance sheet as at December 31, 2007 and its income statement 

for the year then ended. In our opinion, the actuarial liability in the amount of $10,933,780,000 

constitutes an appropriate provision to cover future payments under compensation programs for 

work-related injuries, the For a Safe Maternity program, administrative expenses and expenses for 

the financing of administrative tribunals required to honour these commitments regarding events that 

occurred on or before December 31, 2007 among all employers subject to assessment. The estimate 

of future payments for the compensation of work-related injuries addresses the provisions of the 

Workmen’s Compensation Act, the Act respecting industrial accidents and occupational diseases and the 

Act respecting indemnities for victims of asbestosis and silicosis in mines and quarries. The estimate of 

future payments under the For a Safe Maternity program addresses the provisions of the Act respecting 

occupational health and safety. 

The Commission de la santé et de la sécurité du travail (CSST), in its capacity as trustee of the 

FSST, pursues, on the latter’s behalf, a full-funding objective. According to the full-funding concept 

adopted by the CSST, its assets must be equal to its liabilities without a surplus necessarily being 

maintained. This situation is reflected in the approach used to produce its financial statements and 

evaluate its actuarial liability. Hence, the assumptions used were selected based on a best-estimate 

approach, which implies that there is no margin for adverse statistical deviations or an unfavourable 

evolution of experience. 

However, the assumption related to the real rate of return is an exception to the general bestestimate 

approach. Indeed, given that the FSST’s commitments guarantee the adjustment of its indemnities 

to future inflation and in order to allow for greater stability of assessment rates and the 

financial results, the assumption of a real rate of return of 4.0% is based on long-term trends, and 

a mechanism is used to amortize the annual differences related to the real rate of return. 

The actuarial liability rose from $10,119,571,000 as at December 31, 2006 to $10,933,780,000 

as at December 31, 2007. This $814,209,000 increase, consisting of an increase of $778,770,000 

for compensation programs, an increase of $10,329,000 for the For a Safe Maternity program, an 

increase of $25,444,000 for administrative expenses and a decrease of $334,000 for the financing 

of administrative tribunals, was posted in the income statement for 2007. 

6

The $814,209,000 increase in the actuarial liability includes an increase of $416,719,000 resulting 

from changes made to the methods and assumptions used. 

Additional information regarding the evaluation of the actuarial liability is presented in a more 

detailed actuarial report. 

In our opinion, the amount of the actuarial liability has been determined using reliable and 

sufficient data and appropriate assumptions and methods in accordance with accepted actuarial 

practice. 

Gylles Binet, F.S.A., F.I.C.A. 

Actuary 

Commission de la santé 

et de la sécurité du travail 


Anne St-Martin, F.S.A., F.I.C.A. 

Actuary 


et de la sécurité du travail 


7

Actuarial Consultant’s Report regarding the Commitments 

of the Fonds de la santé et de la sécurité du travail 



I have reviewed the evaluation of the actuarial liability of the Fonds de la santé et de la sécurité 

du travail (FSST) on December 31, 2007 for future payments for the compensation of work-related 

injuries in accordance with the provisions of the Workmen’s Compensation Act, the Act respecting industrial 

accidents and occupational diseases and the Act respecting indemnities for victims of asbestosis and 

silicosis in mines and quarries, and for future payments under the For a Safe Maternity program provided 

for in the Act respecting occupational health and safety. This evaluation was prepared by the 

actuaries of the Commission de la santé et de la sécurité du travail (CSST). 

I have examined the CSST’s funding policy, the provisions of the above-mentioned acts, the 

procedures used to ensure that the data presented is sufficient and reliable, the assumptions and 

methods selected, and how they were applied in evaluating the actuarial liability. 

In keeping with the CSST’s financing objectives, the assumptions used in evaluating the actuarial 

liability were established using a best-estimate approach, except for the assumption related to the 

real rate of return, which was based on long-term trends. 

The actuarial liability of $10,933,780,000 covers future commitments regarding events that occurred 

on or before December 31, 2007 among all employers subject to assessment, including the CSST’s 

administrative expenses and expenses for the financing of administrative tribunals required to honour 

these commitments. In my opinion, this amount constitutes an appropriate provision for the value 

of the FSST’s commitments on December 31, 2007, considering its financing objectives. 

In my opinion, the data on which the evaluation is based is sufficient and reliable and the 

assumptions are, in general, appropriate for the purpose of the evaluation, as are the methods used. 

I have produced this report and expressed the opinions set out therein in accordance with accepted 

actuarial practice. 

Richard Larouche, F.S.A., F.I.C.A. 

Actuary 

Eckler Ltée 


8

Fonds de la santé et de la sécurité du travail 

Income Statement 

for the year ended December 31, 2007 

2007 

(in thousands of dollars) 

2006 

Income 

Employer assessments (Note 3) 2,277,622 2,261,608 

Investment income and interest on assessments (Note 4) 628,679 1,474,994 

Other 5,259 4,234 

2,911,560 3,740,836 

Expenses 

Compensation programs (Note 5) 

Benefits 1,718,219 1,644,080 

Variation in actuarial liability (Note 15) 778,770 344,428 

2,496,989 1,988,508 

For a Safe Maternity program (Note 6) 

Benefits 191,650 187,888 

Variation in actuarial liability (Note 15) 10,329 (16,707) 

201,979 171,181 

Prevention programs (Note 7) 108,290 105,517 

Administrative expenses 

Administrative expenses – CSST 318,600 327,187 

Depreciation – tangible assets 5,968 4,246 

Depreciation – intangible assets 12,824 8,383 

Variation in actuarial liability (Note 15) 25,444 25,263 

362,836 365,079 


Financing of administrative tribunals 

Contributions to the financing of administrative 

tribunals – CSST 53,006 51,807 

Variation in actuarial liability (Note 15) (334) 98 

52,672 51,905 

Doubtful accounts – CSST 17,390 18,062 

3,240,156 2,700,252 

(Deficiency)Exccess of income over expenses (328,596) 1,040,584 

Consisting of : 

Result related to the application of the funding policy 200,395 169,363 

(Deficit) Surplus related to the real rate of return (61,319) 903,546 

Operating deficit for the current year (Note 8) (467,672) (32,325) 

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

9


Accumulated (Deficits) Surpluses 


2007 2006 



Cumulative Cumulative 

Cumulative differences differences 

differences related to related to 

related to the financial the financial 

the real rate requirements for requirements for 

of return previous years current years Total Total 

Balance, beginning of the year 994,806 (767,031) 25,831 253,606 (786,978) 

Result related to the 

application of the funding policy 

Employer assessments 

Assessments related 

to funding (Note 1b) 17,468 186,101 (13,743) 189,826 250,652 

Assessments related to the 

retrospective ratemaking method — — (13,836) (13,836) (28,493) 

17,468 186,101 (27,579) 175,990 222,159 

Interest related to the 

retrospective ratemaking method — — (1,454) (1,454) (2,465) 

Interest on accumulated surpluses 

(deficits) 75,254 (50,675) 1,280 25,859 (50,331) 

92,722 135,426 (27,753) 200,395 169,363 

(Deficit) Surplus related 

to the real rate of return (61,319) — — (61,319) 903,546 

Operating deficit for the 

current year 

(Deficit) Surplus related to financial 

requirements for the current year — — (17,894) (17,894) 8,800 

Deficit related to financial 

requirements for previous years — (449,778) — (449,778) (41,125) 

— (449,778) (17,894) (467,672) (32,325) 

(Deficiency) Exccess of income 

over expenses 31,403 (314,352) (45,647) (328,596) 1,040,584 

Balance, end of year 1,026,209 (1,081,383) (19,816) (74,990) 253,606 


10


Balance Sheet 




2006 

Assets 

Owed by the CSST 262,993 250,120 

Funds deposited with the Caisse de dépôt 

et placement du Québec (Note 9) 10,906,893 10,392,748 

Tangible assets (Note 10) 20,203 20,954 

Intangible assets (Note 11) 67,584 43,054 

11,257,673 10,706,876 

Liabilities 

Bank overdraft 4,564 9,576 

Accounts payable and accruals 106,230 77,233 

Assessments collected in advance 67,330 46,765 

Provision for assessment refunds (Note 12) 125,648 110,815 

Due to the CSST (Note 13) 93,131 87,130 

Long-term debts (Note 14) 1,980 2,180 

Actuarial liability (Note 15) 10,933,780 10,119,571 

11,332,663 10,453,270 

Accumulated (deficits) surpluses (74 990) 253 606 

11,257,673 10,706,876 


Commitments (Note 17) 


For the CSST’s Board of Directors, 

Michel Kelly-Gagnon 

Michel Arsenault 

11


Cash Flows 





Operating activities 

(Deficiency) Excess of income over expenses (328,596) 1,040,584 

Adjustments for: 

Depreciation of tangible assets 5,968 4,246 

Depreciation of intangible assets 12,824 8,383 

Losses on disposal of tangible assets 14 408 

Variation in the provision for assessment refunds 14,833 49,986 

Increase in actuarial liability 814,209 353,082 

Gains on disposal of investment units – Funds 

deposited with the Caisse de dépôt et placement 

du Québec (69,967) (30,488) 

Variation in fair value – Funds deposited with 

the Caisse de dépôt et placement du Québec 216,523 (850,427) 

665,808 575,774 

Variation in non-cash items: 

Owed by the CSST (12,873) 26,914 

Investment income receivable – Funds deposited 

with the Caisse de dépôt et placement du Québec 39,413 11,663 


Assessments collected in advance 20,565 20,470 

Due to the CSST 6,001 12,673 

84,943 80,944 

Cash flows provided by operating activities 750,751 656,718 

Investment activities 

Funds deposited with the Caisse de dépôt et placement 

du Québec: 

Acquisitions of investment units (857,716) (797,966) 

Proceeds from disposal of investment units 382,541 194,003 

Acquisitions of tangible assets (11,518) (4,494) 

Acquisitions of intangible assets (33,595) (14,852) 

Proceeds from disposal of tangible assets — 3 

Cash flows used for investment activities (520,288) (623,306) 

financing activities 

Repayment of long-term debts, i.e. cash flows used 

for financing activities (512) (445) 

Increase in cash and cash equivalents 229,951 32,967 

Shortfall of cash and cash equivalents, beginning of year (314,584) (347,551) 

Shortfall of cash and cash equivalents, end of year (Note 16) (84,633) (314,584) 


12


Notes to Financial Statements 


1. Incorporation, Functions and Financing 

The Fonds de la santé et de la sécurité du travail (FSST), a social trust within the meaning of 

the Civil Code of Québec, is established under section 136.1 of the Act respecting occupational health 

and safety (R.S.Q., chapter S-2.1). The FSST was established following the transfer of the majority 

of the assets of the Commission de la santé et de la sécurité du travail (CSST), which is the trustee 

of the FSST. 

The patrimony of the FSST is dedicated to the payment of the sums or benefits to which any person 

may be entitled under the acts administered by the CSST and to the achievement of any purpose 

provided for in those acts. The CSST transfers to the FSST, as and when received, the sums that it 

collects, except for those kept on deposit, in accordance with the acts it administers. 

The Institut de recherche Robert-Sauvé en santé et en sécurité du travail du Québec (IRSST) has 

been entrusted with the responsibility of developing, coordinating and conducting research activities 

designed to help achieve the objectives of the Act respecting occupational health and safety 

(R.S.Q., chapter S-2.1). The FSST pays it an annual balanced-budget subsidy for this purpose. 

a) Financing method 

The FSST’s main source of income consists of amounts that employers contribute to the CSST and 

that are subsequently transferred to the FSST, in accordance with the law. 


As administrator of the plan, the CSST determines the assessments and, for this purpose, classifies 

the activities of each employer under one or more units according to the rules it establishes by regulation. 

Determined in accordance with basic insurance principles, the assessments vary on the basis 

of the risk associated with the activity performed by the employer and the cost of the work-related 

injuries. More specifically: 

• The assessment rate applicable to an employer is established according to one of the following 

three methods: the unit ratemaking method, the personalized ratemaking method and the 

retrospective ratemaking method. 

• An employer qualifies for, or is subject to, any one of the above-mentioned ratemaking methods 

according to the amount of its assessment. 

Unit ratemaking method 

The assessment is calculated on the basis of the rate of the unit under which the enterprise’s 

activities are classified. The unit rate is determined according to the provincial average rate and 

the cost of work-related injuries associated with the unit in question. 

Personalized ratemaking method 

The assessment is calculated on the basis of a personalized rate, namely, the rate for the unit 

under which the enterprise’s activities are classified, adjusted to take into account the employer’s 

prevention and return-to-work efforts for the victims of work-related injuries. 

13


Retrospective ratemaking method 

The goal of this ratemaking method is to match, as closely as possible, the employer’s annual 

assessment with the real expenses for work-related injuries associated with the employer in 

question. Consequently, the employer’s assessment for a given year will be adjusted subsequently 

to take into account the real cost of the work-related injuries that occurred in its enterprise 

during that same year. 

b) Funding policy 

The full-funding concept adopted by the CSST on behalf of the FSST means that the latter’s assets 

must be equal to its liabilities, without a surplus necessarily being maintained. 

As a result, measures are planned to balance assets and liabilities as expediently as possible, without 

losing sight of the objectives of fairness, stability and prevention. 

These measures result in adjustments to employer assessments and are presented separately in the 

note on employer assessments. 

The main terms and conditions of the funding policy are to: 

• amortize over a ten-year period, with interest, the cumulative differences related to the real 

rate of return; 

• amortize according to the retrospective method, or over a three-year period, with interest, the 

cumulative differences related to the financial requirements for the current year; 

• amortize over a ten-year period, with interest, the cumulative differences related to the financial 

requirements for previous years. 

c) Funding level 

The funding level as at December 31, 2007 stood at 99.3% (2006: 102.4%). This percentage was 

established on the basis of the proportion of assets over liabilities. 

2. Accounting Policies 

The preparation of the financial statements of the FSST in conformity with Canadian generally 

accepted accounting principles requires that management make estimates and assumptions that 

affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities 

at the date of the financial statements and the reported amounts of revenue and expenses during 

the year covered by the financial statements. The main items for which CSST management used 

estimates and assumptions include the fair value of financial instruments, assessments collected in 

advance, the provision for assessment refunds and actuarial liability. Actual results could differ from 

these estimates. 

14

a) Employer assessments 

Assessment income is transferred by the CSST and determined on the basis of an estimate of the 

final assessments. This estimate is designed to take into account the final payroll and classification 

of each employer. It also takes into account, for both employers subject to the personalized 

ratemaking method and those subject to the retrospective ratemaking method, the disbursements 

that will ultimately be charged for the application of these ratemaking methods. 

b) Prevention programs 

The discretionary financial assistance granted is accounted for when authorized and once the beneficiary 

has met any applicable eligibility conditions. 

c) Financial instruments 

Categories of financial instruments 

Assets held for trading are acquired mainly with a view to short-term resale in order to make a 

profit. They are part of a portfolio of financial instruments that are designated as such and managed 

as a whole, and indicate a recent history of short-term profit-taking. This category also includes assets 

that do not satisfy the above-mentioned criteria but that CSST management has chosen to designate 

irrevocably as being held for trading. 

Financial liabilities held for trading are part of a portfolio of financial instruments that are designated 

as such and managed as a whole, and indicate a recent history of short-term profit-taking. 

These liabilities also include those that CSST management has chosen to designate irrevocably as 

being held for trading. 


Other financial liabilities include all non-derivative financial liabilities that do not fall into the 

above category. 

Initial recognition 

Financial instruments are recognized at fair value on the transaction date. 

Subsequent measurement 

Other financial liabilities not held for trading are measured at their amortized cost using the effective 

interest rate method. Assets and liabilities held for trading are measured at fair value, and 

remeasurement gains and losses are recognized in net income. 

Embedded derivatives 

Embedded derivatives are accounted for at fair value, which had no impact on the FSST financial 

statements. 

15

Fair value 

Fair value is the amount of consideration agreed upon in an arm’s length transaction between 

knowledgeable, willing parties who are under no compulsion to act. 


Funds deposited with the Caisse de dépôt et placement du Québec 

The funds deposited with the Caisse de dépôt et placement du Québec are posted at fair value 

as established by the Caisse on the basis of measurement methods used in capital markets, such 

as the discounting of future cash flows at current interest rates, monitoring of major stock 

markets and those provided by recognized stockbrokers. In addition, the Caisse performs certain 

measurements on the basis of commonly used measurement methods. These include, on the 

one hand, the investment deposits in an individual fund at the Caisse that have been designated 

irrevocably as being held for trading and related income receivable and, on the other hand, a 

short-term loan from the Caisse’s general fund and related accrued interest. The variation in 

fair value is posted as investment income. 

Other financial instruments 

Amounts owed by the CSST, items other than investment deposits posted as “Funds deposited 

with the Caisse de dépôt et placement du Québec”, the bank overdraft, and accounts payable and 

accruals are held for trading or have been designated irrevocably as such. They are accounted for 

at fair value which is equal to cost, given that they will mature shortly. 

Amounts due to the CSST are classified as other financial liabilities. Therefore, they are accounted 

for at their amortized cost using the effective interest rate method. The fair value of the amounts 

due to the CSST cannot be estimated, given that there is no market for this type of liability. 

Comprehensive income 

During the fiscal year ended December 31, 2007, the FSST did not conduct any transaction 

having an impact on comprehensive income, and no opening or closing balance is presented for 

accumulated comprehensive income. 

d) Tangible assets 

Tangible assets are presented at their original cost and depreciated in proportion to their estimated 

useful life, according to the straight-line depreciation method, at the following annual rates: 

Furniture and equipment 10% 

Automotive equipment 25% 

Computer equipment 20% 

Telecommunications system 20% 

Equipment under a capital lease 20% 

Leasehold improvements 

Duration of the lease 

16

e) Capital leases 

Lease agreements that the FSST has entered into as lessee and whereby virtually all risks and 

benefits associated with ownership are transferred to it are accounted for as capital leases and 

included in tangible assets and long-term debts. Costs attributed to capital leases represent the 

present value of minimum amounts payable under the lease. 

All other lease agreements are accounted for as operating leases and the resulting leasing costs 

are posted as expenses during the fiscal year in which they are incurred. 

f) Intangible assets 

Intangible assets are presented at their original cost and depreciated in proportion to their estimated 


Software 20% 

Computer systems development 20% 

g) Impairment of Assets 

Tangible assets are regularly examined by management to determine whether their value incurred a 

loss when events or changing circumstances suggest that their carrying value might not be recoverable. 

Impairment is assessed by comparing the carrying value of an asset with undiscounted future 

cash flows estimated at use and with its residual value. If the value of the assets is considered 

impaired, the impairment is allocated to the results for the period during which it is determined. 

The impairment represents the difference between the carrying value and the fair value of the asset. 

The estimate of future cash flows is a matter of professional judgement and may vary over time. 


h) Provision for assessment refunds 

The goal of the retrospective ratemaking method established by the CSST is to match, as closely 

as possible, the employer’s annual assessment with the real expenses for work-related injuries associated 

with the employer in question. Consequently, the employer’s assessment for a given year 

will be adjusted subsequently to take into account the real cost of the work-related injuries that 

occurred in its enterprise during that same year. 

The FSST records annually, as a provision for assessment refunds, the previous year’s adjustment of 

assessment estimates established by the CSST, as well as previous years’ revised estimates for this 

provision. The annual variation of the provision is applied to income from employer assessments. 

However, this provision does not take into account the adjustment for the current year, considering 

the uncertainty related to this adjustment. 

17


i) Actuarial liability 

The liability includes the current estimated value of all future payments to be made regarding 

work-related injuries and preventive withdrawals of pregnant or breast-feeding workers that occurred 

during the current year and during previous years, among all employers subject to assessment. 

This liability includes provisions for pending benefit claims and for compensation of victims of 

industrial accidents whose claims will reach the CSST after the end of the current year. It also 

includes provisions for compensation of victims of work-related injuries who are now being compensated 

and those who may be compensated following a relapse, a recurrence or an aggravation. 

This liability includes a provision for future administrative expenses as well as for future contributions 

to the financing of administrative tribunals regarding events that occurred at the end of 

the year. 

The economic assumptions are established using a real long-term rate of return of 4.0%. 

j) Cash and cash equivalents 

The FSST’s policy is to present bank balances in cash and cash equivalents, including bank 

overdrafts whose balances often fluctuate between overdraft and cash on hand and the line of 

credit used to cover monthly cash deficits. 

k) Future accounting policy changes 

During the next fiscal year, the FSST will apply the new recommendations of the Canadian Institute 

of Chartered Accountants (CICA) with respect to the following sections: 

3862 – Financial Instruments – Disclosure 

3863 – Financial Instruments – Presentation 

The aim of these sections is to provide users with information that allows them to assess the 

significance of financial instruments for the entity’s financial position and performance. They also 

allow users to assess the nature and extent of risks arising from financial instruments to which 

the entity is exposed and the way it manages these risks. These sections replace CICA Handbook 

Section 3861, Financial Instruments – Disclosure and Presentation. Disclosure requirements are 

revised and enhanced, while presentation requirements remain essentially unchanged. 

The CICA has also issued Handbook Section 3064 – Goodwill and Intangible Assets to replace 

Section 3062 – Goodwill and Other Intangible Assets and Section 3450 – Research and Development 

Costs. This new section establishes standards for the recognition, measurement and disclosure of 

goodwill and intangible assets, including internally generated intangible assets, and will be effective 

for financial statements commencing October 1, 2008. 

Sections 3862 and 3863 specifically target disclosure and will have no impact on the FSST’s 

income. As for Section 3064, which will apply for fiscal 2009, management will assess the impact 

of its application during fiscal 2008. 

18

3. Employer assessments 

Assessments related to the current ratemaking year* 



Current operations 2,116,774 2,057,048 

Application of the funding policy 

Adjustment resulting from the amortization 

of the cumulative differences related to the financial 

requirements for previous years 186,101 189,698 


of the cumulative differences related to the financial 

requirements for current years (13,743) (36,707) 


of the cumulative differences related to the real rate 

of return 17,468 97,661 

189,826 250,652 

2,306,600 2,307,700 

Assessments related to previous ratemaking years 

Current operations 

Assessment adjustments (9,095) (17,614) 

(Decrease) Increase resulting from a variation 

in the provision for assessment refunds (6,047) 15 

(15,142) (17,599) 

Application of the funding policy related 

to the retrospective ratemaking method 

Decrease resulting from a variation 

in the provision for assessment refunds (13,836) (28,493) 

(28,978) (46,092) 


2,277,622 2,261,608 

* Assessments for the 2007 ratemaking year were determined by the CSST on the basis of an estimated 

coverage payroll of $105,500,000,000 (2006: $100,500,000,000). 

19

4. Investment Income and Interest on Assessments 




Investment income 

Investment deposits in an individual fund at 

the Caisse de dépôt et placement du Québec 

Current income 437,189 376,012 

Gains realized 389,177 225,139 

Variation in fair value (216,523) 850,427 

609,843 1,451,578 

Interest on short-term deposits with the Caisse 620 465 

Interest on short-term loans with the Caisse (5,318) (7,524) 

605,145 1,444,519 

Interest on bank balances and other 320 276 

Interest on amounts due to the CSST (3,834) (3,026) 

601,631 1,441,769 

Interest on assessments 

Required 41,692 40,466 

Granted (14,644) (7,241) 

27,048 33,225 

628,679 1,474,994 

20

5. Compensation Programs 



Expenses for work-related injuries 

that occurred during the year 

Benefits* 335,127 334,017 

Variation in actuarial liability** 1,159,769 1,094,190 

1,494,896 1,428,207 

Expenses for work-related injuries 

that occurred in previous years 

Benefits* 1,383,092 1,310,063 

Variation in actuarial liability** (380,999) (749,762) 

1,002,093 560,301 

Distribution of compensation programs: 

2,496,989 1,988,508 

Benefits* 

Income replacement 

Medical consolidation and rehabilitation 565,409 566,185 

Post-rehabilitation 497,051 464,800 

1,062,460 1,030,985 

Medical assistance and rehabilitation expenses 424,214 377,161 

Bodily injury 94,924 93,006 

Permanent disability 89,845 93,171 

Death 38,365 40,592 

Economic and social stabilization 8,411 9,165 

1,718,219 1,644,080 

Variation in actuarial liability** 778,770 344,428 


2,496,989 1,988,508 

* Represents all benefits issued for which the coverage period begins during the fiscal year. 

** At the time of the CSST’s ratemaking, the cost of compensation programs, established on July 1, is one of 

the items taken into account in the annual determination of the financial requirements to be met by employer 

assessments. For the purposes of these financial statements, the cost, on July 1, 2007, of compensation programs 

related to events that occurred in 2007 was established at $1,467,611,000, whereas the cost on July 1, 2006 for 

events that occurred in 2006 had been established at the end of 2006 at $1,401,659,000. 

21

6. For a Safe Maternity Program 




Expenses for preventive withdrawals that occurred 

during the year 

Benefits* 129,813 120,988 

Variation in actuarial liability** 63,471 53,287 

193,284 174,275 

Expenses for preventive withdrawals that occurred 

in previous years 

Benefits* 61,837 66,900 

Variation in actuarial liability** (53,142) (69,994) 

8,695 (3,094) 

201,979 171,181 

* Represents all benefits issued for which the coverage period begins during the fiscal year. 

** At the time of the CSST’s ratemaking, the cost of the For a Safe Maternity program, established on July 1, is 

one of the items taken into account in the annual determination of the financial requirements to be met by employer 

assessments. For the purposes of these financial statements, the cost, on July 1, 2007, of the For a Safe Maternity 

program regarding preventive withdrawals in 2007 was established at $191,030,000, whereas the cost on July 1, 2006 

regarding preventive withdrawals in 2006 had been established at the end of 2006 at $172,383,000. 

7. Prevention Programs 



Occupational health services 63,331 61,020 

Subsidy to the Institut de recherche Robert-Sauvé 

en santé et en sécurité du travail du Québec (Note 18) 18,000 17,770 

Subsidies for training and information: 

Joint sector-based associations (Note 18) 17,303 17,029 

Union and employer associations 9,251 9,160 

Other 405 538 

108,290 105,517 

22

8. Operating Deficit for the Current Year 

The operating deficit for the current year represents the ratemaking-related surpluses or deficits 

generated during the current year, which must be adjusted to employer assessments for subsequent 

years, in keeping with the funding policy described in Note 1b. 

The operating deficit for the current year stems from the following variations related to the CSST’s 

ratemaking: 


Surplus (Deficits) 


Variations – Financial requirements for the current year 

Employer assessments* (29,326) (13,152) 

Other income 5,259 4,234 

Compensation programs** 2,589 21,041 

For a Safe Maternity program*** (18,430) (18,683) 

Prevention programs (2,190) (4,017) 

Administrative expenses 15,969 7,686 

Financing of administrative tribunals (842) (510) 

Doubtful accounts 9,610 11,938 

(17,361) 8,537 

Accrued interest from July 1 to December 31 on variations 

related to financial requirements for the current year (533) 263 

(17,894) 8,800 


Variations – Financial requirements for previous years 

Employer assessments**** (15,142) (17,599) 

Compensation programs***** (433,002) (29,167) 

For a Safe Maternity program (6,849) 6,006 

Administrative expenses 2,568 (3,286) 

Financing of administrative tribunals 2,647 2,921 

(449,778) (41,125) 

Operating deficit for the current year (467,672) (32,325) 

* Assessments for the 2007 ratemaking year are approximately $29,326,000 less than initially estimated, which 

constitutes a deficit. Of this amount, a deficit of approximately $26,700,000 stems from a different-than-forecast 

economic activity, which should decrease the cost of compensation programs by about $25,600,000. The remaining 

deficit of approximately $2,600,000 stems from various elements. 

** At the time of the ratemaking, the cost on July 1, 2007 of work-related injuries for 2007 was established at 

$1,470,200,000. This same cost stands at $1,467,611,000 in these financial statements, resulting in a surplus of 

$2,589,000. 

23

However, this surplus of $2,589,000 must be considered in relation to the fact that the differences observed in 

economic activity should have led to a decrease of approximately $25,600,000 in the cost of compensation programs. 

The relative increase of some $23,000,000 in the cost of compensation programs corresponds mainly to medical assistance 

and rehabilitation expenses. 


*** At the time of the ratemaking, the cost on July 1, 2007 of the For a Safe Maternity program was established 

at $172,600,000. In these financial statements, the same cost stands at $191,030,000, resulting in a deficit of 

$18,430,000, which is due mainly to the fact that the number of workers compensated is almost 7% higher than 

estimated. 

**** The deficit of $15,142,000 is due primarily to assessment refunds resulting from corrections made to charges 

that were more substantial than forecast. 

***** This deficit of $433,002,000 is composed of several elements. First, a deficit of $355,362,000 corresponds 

to medical assistance and rehabilitation expenses. Of this amount, $255,015,000 stems from the recognition of recent 

experience in establishing assumptions, while the remaining $100,347,000 can be ascribed to the 2007 impact of 

changes made in the delivery of hearing-aid services. Second, a deficit of $145,931,000 is due to tax changes announced 

by the finance ministers in 2007. The remaining surplus amounts to $68,291,000, including a surplus of $49,327,000 

concerning income replacement indemnities paid during the post-rehabilitation period, and a surplus of $28,287,000 

for income replacement indemnities paid during a medical consolidation and rehabilitation period. 

9. Funds Deposited with the Caisse de dépôt et placement du Québec 



Assets held for trading 

Individual fund 

Investment deposit at fair value 10,968,399 10,639,780 

Income receivable 18,563 57,976 

10,986,962 10,697,756 

General fund 

Variable-rate short-term loan and accrued interest* (80,069) (305,008) 

10,906,893 10,392,748 

* The FSST has a $450-million line of credit with the Caisse to cover its monthly cash deficits. The interest 

rate on this line of credit is based on the rate of return of the demand deposit account established daily, 

plus 0.05%. The interest rate was 4.3% as at December 31, 2007 (2006: 4.3%). This line of credit expires in 2008. 

Pursuant to the credit agreement with the Caisse, except on the first day of every month, the authorized maximum 

may exceed $450 million in the course of any given month. 

24

The investment deposit in an individual fund at the Caisse de dépôt et placement du Québec (Caisse) 

is expressed in units. These units are redeemable upon prior notice, according to the terms of 

the Caisse’s regulations and specific agreements, at fair value of the net equity of the individual fund 

at the end of each month. At the close of each monthly period of the individual fund, the Caisse 

allocates the net investment income as well as the gains and losses on investments to the FSST. 

Restructuring of third-party ABCP 

The Caisse determined the fair value of the investment deposit as at December 31, 2007 by recognizing 

a decrease in value on its investments in the Canadian market for non-bank asset-backed 

commercial paper being restructured (ABCP). 

ABCP is a short-term financing instrument issued by trusts, also referred to as “conduits,” generally 

for maturities ranging from one to three months. ABCP is backed by various assets, such as mortgage 

debt or consumer and financial assets. Since August 2007, the Caisse has not been able to 

redeem, on maturity, the ABCP that it holds. 

Since there is no active market for ABCP securities, the Caisse established the fair value of its 

holdings of various ABCP securities according to a measurement technique based on a financial model 

whose assumptions and probabilities reflect uncertainties related to the amounts and the maturities 

of the cash flow, the credit risk of the underlying debt and financial assets and the return. The 

assumptions, based on the information available as at December 31, 2007, rely as much as possible 

on observable market data, such as interest rates and credit quality. By establishing the fair values 

of the securities, the Caisse is attributing a strong probability of success to the restructuring proposal 

currently being studied by the Pan-Canadian Investors Committee for Third-Party Structured 

ABCP, and a low probability to a scenario involving orderly or forced liquidation. 


According to the audited financial statements of the individual fund of the Caisse, the estimate of 

fair values recognized for ABCP is reasonable and the most appropriate as at December 31, 2007. 

Nonetheless, the fair values reported may vary significantly over subsequent periods. The most critical 

assumption is based on the probability of success of the restructuring proposal. Assigning greater 

weight to a liquidation scenario would substantially increase the estimated unrealized decrease in 

value. On the other hand, acceptance of the restructuring proposal and a return to normal market 

conditions would result in an increase in the estimated fair values of ABCP. An adjustment to the 

decrease in value recognized by the Caisse would have an effect on the fair value of the investment 

deposit held by the FSST. 

As at December 31, 2007, the share of investment results, net of ABCP securities attributed to the 

FSST individual fund by the general fund, in accordance with the terms and conditions of the general 

fund reserve stipulated in this regard, consists of: 

• the share of the unrealized loss on these securities, in the amount of $112.5 million, and 

• the share of the reversal of interest paid to specialized portfolios in relation to these securities, 

in the amount of $15.6 million, and the share of the restructuring costs of these securities and 

others, in the amount of $3.9 million. 

25

10. Tangible Assets 


Accumulated 

Cost depreciation Net Net 

Furniture and equipment 4,410 1,438 2,972 2,990 

Automotive equipment 914 614 300 358 

Computer equipment 23,847 11,004 12,843 13,090 

Telecommunications system 3,157 1,222 1,935 2,114 

Leasehold improvements 2,674 1,156 1,518 1,890 

35,002 15,434 19,568 20,442 

Equipment under a capital 

lease 940 305 635 512 

35,942 15,739 20,203 20,954 

11. Intangible Assets 





Accumulated 


Software 16,729 4,943 11,786 5,757 

Computer systems development* 80,367 24,569 55,798 37,297 

97,096 29,512 67,584 43,054 

* Computer systems development valued at $10,949,262 (2006: $3,766,533) was being carried out as at 

December 31, 2007, and is not amortized. 

26

12. Provision for Assessment Refunds 

Provision regarding the adjustments of assessments 

for employers subject to the retrospective 

ratemaking method 



Balance, beginning of year 110,815 60,829 

Variation for the year 

Application of the funding policy with respect 

to the retrospective ratemaking method 13,836 28,493 

Revision of the estimate for previous years 6,047 (15) 

Interest 10,509 6,545 

30,392 35,023 

Net impact of adjustments made during the year 

Assessments (10,713) 15,928 

Interest on assessments granted (4,846) (965) 

(15,559) 14,963 

Balance, end of year 125,648 110,815 


13. Due to the CSST 

The amounts due to the CSST have no fixed terms of repayment. The interest rate on these 

amounts is the average yearly rate applicable to the FSST’s line of credit with the Caisse de dépôt 

et placement du Québec which, for 2007, was 4.4% (2006: 4.1%). 

27

14. Long-term Debts 


Obligations under capital leases at interest rates varying 

from 2.6% to 4.3% (2006: 2.6% and 3.3%), maturing until 2012 605 466 

Obligations under the financing of leasehold improvements 

included in leases at interest rates varying from 2.6% to 4.3% 

(2006: 2.6% and 3.3%), maturing until 2015 1,375 1,714 

Future minimum payments are as follows: 

2008 583 

2009 488 

2010 345 

2011 284 

2012 201 

2013 to 2015 217 

Total minimum payments 2,118 

Less: amount representing the interest included 

in minimum payments 138 



1,980 2,180 

1,980 

The fair value of long-term debts (obligations arising from capital leases and the financing of 

leasehold improvements included in the leases), which represents the present value of future 

payments at the market rate on December 31, 2007, is $1,924,340 (2006: $2,089,099). 

28

15. Actuarial Liability 

Balance, beginning of year 10,119,571 9,766,489 

Variation in actuarial liability 

Compensation programs 

Evolution of actuarial liability 362,051 337,466 

Changes in non-economic assumptions 

and methods of calculating actuarial liability 416,719 6,962 

778,770 344,428 

For a Safe Maternity program 



Evolution of actuarial liability 10,329 (16,707) 

Administrative expenses 

Evolution of actuarial liability 25,444 25,207 

Changes in non-economic assumptions 

and methods of calculating actuarial liability — 56 

25,444 25,263 

Financing of administrative tribunals 

Evolution of actuarial liability (334) 98 

814,209 353,082 


Balance, end of year 10,933,780 10,119,571 

This actuarial liability is distributed as follows 

with respect to indemnities borne by the FSST: 

Compensation programs 

Income replacement 

Medical consolidation and rehabilitation 1,233,422 1,192,921 

Post-rehabilitation 5,644,689 5,297,628 

6,878,111 6,490,549 

Medical assistance and rehabilitation expenses 1,847,960 1,444,950 

Bodily injury 351,342 327,880 

Permanent disability 825,380 851,766 

Death 254,680 258,715 

Economic and social stabilization 39,937 44,780 

10,197,410 9,418,640 

For a Safe Maternity program 65,297 54,968 

Administrative expenses 540,301 514,857 

Financing of administrative tribunals 130,772 131,106 

10,933,780 10,119,571 

29

16. Cash Flows 


Cash and cash equivalents 

The cash and cash equivalents appearing in the statement of cash flows include the following 

recorded amounts: 



Bank overdraft (4,564) (9,576) 

Funds deposited with the Caisse de dépôt et placement 

du Québec – Variable-rate short-term loan and accrued 

interest (Note 9) (80,069) (305,008) 

Shortfall of cash and cash equivalents (84,633) (314,584) 

Interest paid during the year* 48,148 32,559 

* The interest paid is already included in the income statements or presented separately in the Notes to Financial 

Statements. 

During the year, tangible assets were acquired under lease agreements at a cost of $311,649 

(2006: $352,928). 

As at December 31, 2007, the item “Accounts payable and accruals” includes acquisitions of 

tangible and intangible assets, respectively valued at $539,001 and $4,255,721 (2006: $7,138,460 

and $496,494). 

30

17. Commitments 

As of January 1, 2003, the FSST shall assume all the obligations of a financial nature contracted 

by the CSST before that date, in accordance with the Act respecting occupational health and safety 

(R.S.Q., chapter S-2.1). 

Commitments 

Rental space leases 

The FSST is committed to rental space leases entered into by the CSST totalling $198,521,079 on 

December 31, 2007 (2006: $137,933,198). These leases run until 2029 with a renewal option upon 

expiry. A clause provides for rent review based on increases in operating expenses or taxes. 

Payments over the next five years, based on the rental amounts as at December 31, 2007, are 

as follows: 

2008 $21,643,216 

2009 $19,506,523 

2010 $18,290,624 

2011 $16,409,831 

2012 $15,263,641 

Equipment leasing and service contracts 

The FSST is committed to various equipment leasing and service contracts entered into by the 

CSST, estimated at $77,466,764 on December 31, 2007 (2006: $79,563,934). These contracts, 

which extend over a period of one to five years, call for the following annual payments: 


Regular activities 

Modernization of services 

2008 $23,484,857 2008 $31,966,558 

2009 $9,852,795 2009 $5,441,788 

2010 $3,577,371 2010 $2,445,987 

2011 $645,256 2011 $ — 

2012 $52,152 2012 $ — 

31

18. Related Party Transactions 


The FSST is related to the CSST, its trustee, to the IRSST, which is controlled by the CSST, and 

to joint sector-based associations, which are significantly influenced by the CSST. The FSST did not 

conclude any commercial transaction with these related parties other than in the normal course of 

its activities and under the usual commercial conditions. These related party transactions, accounted 

for at exchange value, are presented in these financial statements. 

19. Financial Instruments 

Management of risks related to financial instruments 

CSST management has implemented the policies and procedures required to manage and control 

the risks inherent in financial instruments. 

Market risk and concentration risk 

Market risk corresponds to the financial loss the FSST may incur due to adverse changes in the 

value of financial instruments, resulting from changes in the variables underlying their valuation, 

in particular interest rates, exchange rates and share prices. 

Concentration risk arises where investments are made with a single entity. 

The major risk in this regard concerns the fluctuation in the funds wholly deposited with the 

Caisse de dépôt et placement du Québec. To manage these risks, the CSST follows an investment 

policy designed to optimize the return on the individual fund, while ensuring a level of risk that is 

acceptable for the FSST. 

Liquidity risk 

Liquidity risk represents the possibility that the FSST may not be able to raise, in a timely manner 

and under reasonable conditions, the funds needed to meet its financial commitments. 

To deal with this risk, the liquidity requirements of the FSST are forecast on a daily basis and 

the necessary transfers are carried out with the Caisse de dépôt et placement du Québec. The FSST 

can also draw on a $450-million line of credit with the Caisse de dépôt et placement du Québec 

to meet its liquidity requirements. Additionally, the FSST has access to a $10-million line of credit 

with a financial institution. 

32

Interest-rate risk 

Interest-rate volatility has an impact on the fair value of FSST financial assets and liabilities as well 

as on its cash and cash equivalents. 

The short-term loan from the general fund of the Caisse de dépôt et placement du Québec and 

the amount due to the CSST bear interest at variable rates, which results in a cash flow risk as to 

the interest that will be paid on these debts. 

Long-term debts bear interest at fixed rates. Consequently, the risk exposure of the FSST in relation 

to such debts is minimal, since the FSST plans to hold them until maturity. 

20. Line of Credit 

The FSST has a $10-million line of credit with a financial institution that can be used as credit 

on request or as an overdraft and expires on October 31, 2008. The applicable interest rate is 

the base rate, and the line of credit was undrawn as at December 31. 

21. Comparative Figures 

Certain figures from 2006 have been reclassified to conform to the 2007 presentation of the 



33


et de la sécurité 

du travail 


for the Year Ended December 31, 2007

Management’s Report 

CSST Financial Statements 

The financial statements of the Commission de la santé et de la sécurité du travail (CSST) are 

prepared by management, which is responsible for the integrity and fairness of the data, 

including significant accounting judgements and estimates. This responsibility includes the choice of 

appropriate accounting policies in keeping with Canadian generally accepted accounting principles. 

The financial information contained elsewhere in the Annual Management Report is consistent with 

these financial statements. 

To fulfil its responsibilities regarding the integrity and fairness of the financial statements, 

management exercises the internal controls necessary to provide users with reasonable assurance 

that the financial information is relevant and reliable and the assets are adequately safeguarded. 

The internal audit branch conducts periodic audits to ensure that the internal controls applied 

uniformly by the CSST are adequate and sustained. 

CSST management recognizes that it is responsible for administering its affairs in accordance with 

the statutes and regulations governing it. 

The Board of Directors is responsible for monitoring the manner in which management fulfils its 

responsibilities regarding financial information, and approves the financial statements. The Audit 

Committee, whose members are not part of management, assists the Board of Directors in this 

mandate. This Committee meets with management and the Auditor General, reviews the financial 

statements and recommends the approval thereof to the Board of Directors. 

The Auditor General of Québec has audited the financial statements of the CSST in accordance with 

Canadian generally accepted auditing standards. The Auditor’s report sets out the nature and scope 

of this audit and expresses the Auditor’s opinion. The Auditor General has free access to the audit 

committee to discuss audit-related issues. 

Luc Meunier 

Chairman of the Board and Chief Executive Officer 

André Beauchemin 

Vice-President, Finance 


36

Auditor’s report 

To the National Assembly 

I have audited the balance sheet of the Commission de la santé et de la sécurité du travail (CSST) 

as at December 31, 2007 and the income statements, accumulated surpluses and cash flows for 

the year then ended. These financial statements are the responsibility of CSST management. My 

responsibility is to express an opinion on these financial statements based on my audit. 

I conducted my audit in accordance with Canadian generally accepted auditing standards. These 

standards require that I plan and perform an audit to obtain reasonable assurance whether the financial 

statements are free of material misstatement. An audit includes examining, on a test basis, 

evidence supporting the amounts and disclosures in the financial statements. An audit also includes 

assessing the accounting principles used and significant estimates made by management, as well as 

evaluating the overall financial statement presentation. 

In my opinion, these financial statements present fairly, in all material respects, the financial 

position of the CSST as at December 31, 2007 and the results of its operations and its cash flows 

for the year then ended in accordance with Canadian generally accepted accounting principles. As 

required by the Auditor General Act (R.S.Q., chapter V-5.01), I report that, in my opinion, with 

the exception of the accounting policy changes relating to financial instruments explained in Note 3, 

these principles have been applied on a basis consistent with that of the previous year. 


Renaud Lachance, CA 

Auditor General of Québec 


37

Commission de la santé et de la sécurité du travail 

Income Statement 





Income* 

Contributions from the FSST (Note 1) 388,996 397,056 

Interest income 4,082 3,245 

Other 526 494 

393,604 400,795 

Expenses 

Administrative expenses (Note 4) 318,600 327,187 

Financing of administrative tribunals (Note 5) 53,006 51,807 

Doubtful accounts 17,390 18,062 

388,996 397,056 

Excess of income over expenses 4,608 3,739 

* The CSST assessed employers for the amount of $2,277,622,000 in 2007 (2006: $2,261,608,000) under the acts 

it administers. However, these amounts do not appear in this statement because they are transferred as and when they 

are collected by the CSST to the Fonds de la santé et de la sécurité du travail (FSST), in accordance with section 136.5 

of the Act respecting occupational health and safety (R.S.Q., chapter S-2.1). 


38


Accumulated Surpluses 









39


Balance Sheet 





Assets 

Cash 6,058 5,810 

Assessments to be collected for the FSST 

and other receivables (Note 6) 343,276 341,358 

Owed by depositors (Note 11) 17,538 18,622 

Prepaid expenses 6,585 2,431 

Owed by the FSST (Notes 1 and 7) 93,131 87,130 

Tangible assets (Note 8) 4,254 5,542 

Intangible assets (Note 9) — 335 

470,842 461,228 

Liabilities 


Owed to the FSST (Note 1) 262,993 250,120 

Provision for sick leave and vacation time (Note 10) 86,596 86,816 

367,399 362,393 

Accumulated surpluses 103,443 98,835 


470,842 461,228 

For the Board of Directors, 

Michel Kelly-Gagnon 

Michel Arsenault 

40


Cash Flows 




2006 

Operating activities 


Adjustments for: 

Depreciation of tangible assets 1,276 2,152 

Depreciation of intangible assets 335 6,963 

Losses on disposal of tangible assets 11 27 

Variation in the provision for sick leave and vacation time (220) 3,017 

6,010 15,898 

Variation in non-cash items: 

Assessments to be collected for the FSST and other 

receivables (1,918) 20,168 

Owed by depositors 1,084 (105) 

Prepaid expenses (4,154) (955) 

Owed by the FSST (6,001) (12,673) 

Accounts payable and accruals (7,647) 4,787 

Owed to the FSST 12,873 (26,914) 

(5,763) (15,692) 

Cash flows provided by operating activities 247 206 

Investment activities 

Proceeds from disposal of tangible assets, i.e. cash flows 

provided by investment activities 1 29 


Increase in cash 248 235 

Cash, beginning of year 5,810 5,575 

Cash, end of year 6,058 5,810 


41


Notes to Financial Statements 



1. Incorporation, Functions and Financing 

The Commission de la santé et de la sécurité du travail (CSST) is a legal person, as defined in the 

Civil Code of Québec, and was incorporated on March 13, 1980 under the Act respecting occupational 

health and safety (R.S.Q., chapter S-2.1). For the purposes of this Act, the CSST is responsible for 

preparing, proposing and implementing policies relating to worker health and safety to ensure a safer 

work environment. It collects the amounts necessary for the administration of this Act from employers. 

The CSST is also responsible, for the purposes of the Workmen’s Compensation Act (R.S.Q., chapter A-3) 

and the Act respecting industrial accidents and occupational diseases (R.S.Q., chapter A-3.001), for 

assessing employers annually, in accordance with its financing method and following actuarial 

valuations, at the rates applicable to the units under which their activities are classified, or at the 

applicable personalized rates or, where applicable, in accordance with the Regulation respecting 

retrospective adjustment of the assessment. 

The CSST is the trustee of the Fonds de la santé et de la sécurité du travail (FSST), a social trust 

established on January 1, 2003, the patrimony of which is dedicated to the payment of the sums 

or benefits to which any person may be entitled under the acts administered by the CSST and to 

the achievement of any purpose provided for in those acts. The FSST is not consolidated, because 

it constitutes a separate trust patrimony under section 136.2 of the Act respecting occupational 

health and safety (R.S.Q., chapter S-2.1). 

To account for the administration of the FSST, the following table presents a summary of its 

balance sheet. 



Assets 

Funds deposited with the Caisse de dépôt 

et placement du Québec 10,906,893 10,392,748 

Owed by the CSST 262,993 250,120 

Other assets 87,787 64,008 

11,257,673 10,706,876 

Liabilities 

Actuarial liability 10,933,780 10,119,571 

Owed to the CSST 93,131 87,130 

Other liability 305,752 246,569 

11,332,663 10,453,270 

Accumulated (deficits) surpluses (74,990) 253,606 

11,257,673 10,706,876 

The CSST is also responsible for administering the Crime Victims Compensation Act (R.S.Q., 

chapter I-6) and the Act to promote good citizenship (R.S.Q., chapter C-20). The amounts necessary 

for the administration of these acts are reimbursed by the Government of Québec. 

42

Contributions from the FSST 

In accordance with section 136.8 of the Act respecting occupational health and safety (R.S.Q., 

chapter S-2.1), the expenses related to the administration of the FSST are payable by the FSST. 

The expenses of the CSST related to the application of the acts it administers are also payable by 

the FSST, except those that are paid out of the sums it keeps on deposit. 

Financing method 

The CSST chooses the financing method that it deems appropriate to enable it to meet the obligations 

of the plan and the expenses borne by the FSST as they arise, and to prevent employers from 

being unduly burdened thereafter with compensation payments attributable to past work-related 

injuries. 

The CSST applies a ratemaking method that is more reflective of the dual role assigned to it by 

law, as both a prevention agent and a public insurer. 

The CSST determines the employer classification units by regulation on an annual basis. 

For the purposes of determining employer assessments, the CSST classifies the activities of each 

employer under one or more units according to the rules it establishes by regulation. Determined in 

accordance with basic insurance principles, the assessments vary on the basis of the risk associated 

with the activity performed by the employer and the cost of the work-related injuries. 

The assessment rate applicable to an employer is established according to one of the following three 

methods: the unit ratemaking method, the personalized ratemaking method and the retrospective 

ratemaking method. 


The CSST collects from employers the sums it assesses under the acts it administers. These sums are 

transferred as and when they are collected by the CSST to the FSST, in accordance with section 

136.5 of the Act respecting occupational health and safety (R.S.Q., chapter S-2.1). 

2. Accounting Policies 

The preparation of the financial statements of the CSST in conformity with Canadian generally 

accepted accounting principles requires that management make estimates and assumptions that affect 

the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at 

the date of the financial statements and the reported amounts of revenue and expenses during 

the period covered by the financial statements. The main item for which CSST management used 

estimates and assumptions is the allowance for doubtful accounts. Actual results could differ from 

these estimates. 

a) Financial instruments 

Categories of financial instruments 

Assets held for trading are acquired mainly with a view to short-term resale in order to make a 

profit. They are part of a portfolio of financial instruments that are designated as such and managed 

as a whole, and indicate a recent history of short-term profit-taking. This category also includes 

assets that do not satisfy the above-mentioned criteria but that CSST management has chosen to 

designate irrevocably as being held for trading. 

43

Loans and receivables do not include debt securities. 


Financial liabilities held for trading are part of a portfolio of financial instruments that are designated 

as such and managed as a whole, and indicate a recent history of short-term profit-taking. 

These liabilities also include those that CSST management has chosen to designate irrevocably as 

being held for trading. 

Initial recognition 

Financial instruments are recognized at fair value on the transaction date. 

Subsequent measurement 

Loans and receivables are measured at their amortized cost using the effective interest rate method. 

Assets and liabilities held for trading are measured at fair value, and remeasurement gains and 

losses are recognized in net income. 

Embedded derivatives 

Embedded derivatives are accounted for at fair value, which had no impact on the CSST financial 

statements. 

Fair value 

Fair value is the amount of consideration agreed upon in an arm’s length transaction between 

knowledgeable, willing parties who are under no compulsion to act. 

• Cash, assessments to be collected for the FSST and other receivables, amounts owed by 

depositors, accounts payable and accruals, and amounts owed to the FSST are held for trading 

or have been designated irrevocably as such. They are accounted for at fair value which is equal 

to cost, given that they will mature shortly. 

• The amounts owed by the FSST are classified as loans and receivables. Therefore, they are 

accounted for at their amortized cost using the effective interest rate method. The fair value of 

these amounts cannot be estimated, given that there is no market for this type of asset. 

Comprehensive income 

During the fiscal year ended December 31, 2007, the CSST did not conduct any transaction 

having an impact on comprehensive income, and no opening or closing balance is presented for 

accumulated comprehensive income. 

b) Tangible assets 

Tangible assets are presented at their original cost and depreciated in proportion to their estimated 


Buildings 2.5% 

Furniture and equipment 10% 

Automotive equipment 25% 

Computer equipment 20% 

Telecommunications system 20% 

Leasehold improvements 

Duration of the lease 

44

c) Intangible assets 

Intangible assets are presented at their original cost and depreciated in proportion to their estimated 


Software 20% 

Computer systems development 20% 

d) Impairment of Assets 

Tangible assets are regularly examined by management to determine whether their value incurred a 

loss when events or changing circumstances suggest that their carrying value might not be recoverable. 

Impairment is assessed by comparing the carrying value of an asset with undiscounted future 

cash flows estimated at use and with its residual value. If the value of the assets is considered 

impaired, the impairment is allocated to the results for the period during which it is determined. 

The impairment represents the difference between the carrying value and the fair value of the asset. 

The estimate of future cash flows is a matter of professional judgement and may vary over time. 

e) Pension plans 

The accounting method used for defined contribution pension plans is applied to government 

inter-enterprise defined benefit plans, since the CSST does not have enough information to apply 

the accounting method for defined benefit plans. 

f) Future accounting policy changes 

During the next fiscal year, the CSST will apply the new recommendations of the Canadian Institute 

of Chartered Accountants (CICA) with respect to the following sections: 


3862 – Financial Instruments – Disclosure 

3863 – Financial Instruments – Presentation 

The aim of these sections is to provide users with information that allows them to assess the 

significance of financial instruments for the entity’s financial position and performance. They also 

allow users to assess the nature and extent of risks arising from financial instruments to which 

the entity is exposed and the way it manages these risks. These sections replace CICA Handbook 

Section 3861, Financial Instruments – Disclosure and Presentation. Disclosure requirements are 

revised and enhanced, while presentation requirements remain essentially unchanged. These sections 

specifically target disclosure and will have no impact on the CSST’s income. 

3. Accounting Change 

As of the current fiscal year, the CSST is applying the new Canadian Institute of Chartered Accountants 

recommendations relating to the recognition, measurement and presentation of financial instruments, 

in advance, retrospectively and without restatement of prior periods, further to the publication of 

Section 1530 – Comprehensive Income, Section 3855, Financial Instruments – Recognition and 

Measurement, Section 3861 – Financial Instruments – Disclosure and Presentation and, lastly, 

Section 3865 – Hedges. For the CSST, the impact of these new accounting policies is limited solely 

to the disclosure of additional information, given that the categories adopted by the CSST had no 

impact on the measurement of financial instruments. These categories are explained in Note 2 a). 

45

4. Administrative Expenses 




Wages and employee benefits 241,186 241,895 

Training and professional development 699 763 

Travel expenses 9,798 9,155 

Postage, courier and telecommunications 7,169 6,946 

Communications and information 3,943 4,415 

Professional services – administration and computing 23,066 26,237 

Maintenance and repairs – computer equipment 7,322 7,364 

Maintenance and repairs – tangible assets and other 4,590 3,255 

Material and supplies 3,456 3,251 

Rental space 23,175 22,638 

Equipment rental – computing 2,649 2,840 

Equipment rental – other 601 643 

Insurance, taxes and power supply 2,241 2,157 

Other expenses and services 2,642 2,724 

Depreciation – tangible assets 1,276 2,152 

Depreciation – intangible assets 335 6,963 

334,148 343,398 

Less: 

Expenses charged (Note 11) 

Employers personally liable for the payment 

of benefits 1,309 1,785 

Government of Canada, with respect to the 

Government Employees Compensation Act 2,959 3,828 

Government of Québec, with respect to the 

Crime Victims Compensation Act 10,580 9,925 


Act to promote good citizenship 57 109 

14,905 15,647 

Other expenses charged 643 564 

15,548 16,211 

318,600 327,187 

46

5. Financing of Administrative Tribunals 



Contributions for the year 

Commission des lésions professionnelles 54,067 52,779 

Tribunal administratif du Québec 20 26 

54,087 52,805 

Less: 

Expenses charged (Note 11) 


of benefits 324 317 


Government Employees Compensation Act 757 681 

1,081 998 

53,006 51,807 

6. Assessments to be collected for the FSST and other receivables 




Assessments to be collected 365,362 360,162 

Overpayment of compensation program benefits 

to be collected 26,608 26,623 

Other receivables 6,786 6,407 

398,756 393,192 

Less: 

Allowance for doubtful accounts 55,480 51,834 

343,276 341,358 

47

7. Owed by the FSST 


These amounts have no fixed terms of repayment. The interest rate on these amounts is the average 

yearly rate applicable to the FSST’s line of credit with the Caisse de dépôt et placement du Québec 

which, for 2007, was 4.4% (2006: 4.1%). 

8. Tangible Assets 



Accumulated 


Land 749 — 749 749 

Buildings 10,556 8,516 2,040 2,304 

Furniture and equipment 15,529 14,159 1,370 1,877 

Automotive equipment 586 586 — — 

Computer equipment 33,113 33,113 — 459 

Telecommunications system 8,420 8,420 — 39 

Leasehold improvements 4,684 4,589 95 114 

73,637 69,383 4,254 5,542 

9. Intangible Assets 



Accumulated 


Software 30,241 30,241 — 335 

Computer systems development 173,276 173,276 — — 

203,517 203,517 — 335 

48

10. Provision for Sick Leave and Vacation Time 

Sick leave Vacation time Total Total 

Balance, beginning of year 62,011 24,805 86,816 83,799 

Expenditure for the year 10,842 20,986 31,828 32,676 

Benefits paid during the year (10,879) (21,169) (32,048) (29,659) 

Balance, end of year 61,974 24,622 86,596 86,816 

11. Deposits in Trust 



Under the Workers’ Compensation Act (R.S.Q., chapter A-3), the CSST may, where it believes it 

necessary, require a deposit from employers who are personally liable for the payment of benefits, 

in order to ensure prompt payment of these benefits. Such deposits are held in trust by the CSST, 

thereby enabling it to pay benefits to beneficiaries for whom these employers are responsible. 

Employers who are personally liable for the payment of benefits also pay their share of the costs 

incurred by the CSST for the administration of the Workers’ Compensation Act and the Act respecting 

industrial accidents and occupational diseases (R.S.Q., chapter A-3.001). Under the Government 

Employees Compensation Act (R.S.C., 1985, chapter G-5) and according to an agreement with 

the Government of Canada, the latter and its agencies are considered to be employers who are 

personally liable for the payment of benefits, and thus pay a deposit to the CSST for that purpose. 


In addition to administering Québec’s occupational health and safety system, the CSST has also been 

mandated to see to the administration of the Crime Victims Compensation Act (R.S.Q., chapter I-6) 

and the Act to promote good citizenship (R.S.Q., chapter C-20). For both of these mandates, the 

Government of Québec deposits with the CSST the sums the latter holds in trust to compensate beneficiaries 

under these two acts and to cover the administrative expenses it incurs in this respect. 

In all of the above cases, since they are fully borne by employers who are personally liable for 

the payment of benefits, these and future benefits related to events that occurred at the end of the 

year are not presented in the CSST’s income statement or in its balance sheet. However, the amounts 

collected to finance the expenses incurred by the CSST for the administration of these acts are 

offset against administrative expenses and the costs of financing administrative tribunals. 

49

For the fiscal year, the benefits and administration costs thus borne by employers who are 

personally liable for the payment of benefits, by the Government of Canada with respect to the 

Government Employees Compensation Act and by the Government of Québec with respect to the 

Crime Victims Compensation Act and the Act to promote good citizenship are as follows: 


Benefits 




of benefits 14,261 14,914 







103,701 101,725 

Administration costs applied against CSST 

administrative expenses and financing of 

administrative tribunals for: 


of benefits 1,633 2,102 







15,986 16,645 

119,687 118,370 

50

To account for the administration of deposits in trust, the balance sheet and the statement 

concerning the evolution of deposits in trust have been established as follows. 

Assets 

Deposit in trust 

Balance Sheet 


Depositors’ claims* 17,538 18,622 

Funds invested in trust for depositors* 6,412 6,599 

Liabilities** 



23,950 25,221 

Accounts payable to the CSST 17,538 18,622 

Deposits in trust 


of benefits** 2,189 2,376 







6,412 6,599 


23,950 25,221 

* The fair value of depositors’ claims and the funds invested in trust for depositors in the form of bank deposits 

is equal to their book value, given that they will mature shortly. 

** The CSST has not evaluated or recorded in actuarial liabilities the value of the commitments related to benefit 

claims on behalf of employers personally liable for the payment of benefits, due to the very slight probability that 

all employers personally liable for the payment of benefits, as well as their insurers or sureties or warrantors, will 

disappear or become insolvent. 

51

Deposit in trust 

Evolution of Deposits in Trust 






Change in the year 

Interest on deposits 49 83 

Benefits offset against deposits (207) (210) 

Refund of deposits (29) (1,655) 

(187) (1,782) 


12. Related Party Transactions 

The CSST is related to the FSST, of which it is trustee. The CSST did not conclude any 

commercial transaction with this related party other than in the normal course of its activities and 

under the usual commercial conditions. These transactions with the related party, accounted for 

at exchange value, are presented in these financial statements. 

13. Employer Contributions to Pension Plans 

The CSST’s employees subscribe to the Civil Service Superannuation Plan, the Government and Public 

Employees’ Retirement Plan and the Management Employees Pension Plan, which are administered 

by the Commission administrative des régimes de retraite et d’assurances. These are multiemployer 

defined benefit plans that guarantee payment at retirement and death. 

The CSST’s obligations toward these government plans are limited to its contributions for regular 

services as an employer. The CSST’s contributions charged to this year’s expenses amount to 

$11,140,477 (2006: $10,590,100). 

52

14. Financial Instruments 

Management of risks related to financial instruments 

CSST management has implemented the policies and procedures required to manage and control the 

risks inherent in financial instruments. 

Credit risk 

The use of financial instruments may entail a credit risk corresponding to the risk of financial loss 

resulting from a counterparty’s inability or refusal to fully meet its contract obligations. 

Since the CSST’s receivables stem from its role as a government insurer, it must assume its credit 

risk with regard to them. However, it ensures sound management of its receivables by applying strict 

terms and conditions for recovery and establishing adequate provisions. 

15. Comparative Figures 

Certain figures from 2006 have been reclassified to conform to the 2007 presentation of the 



53

CSST Offices 

Just one number for 

the CSST: 

1 866 302-CSST (2778) 

Head Office 

524, rue Bourdages 

C. P. 1200 

Succursale Terminus 

Québec 

(Québec) G1K 7E2 

Fax 418 266-4398 

Administrative Centre 

1199, rue De Bleury 

C. P. 6056 

Succursale Centre-ville 

Montréal 

(Québec) H3C 4E1 

Fax 514 906-3852 

Regional Offices 

Abitibi-Témiscamingue 

33, rue Gamble Ouest 

Rouyn-Noranda 

(Québec) J9X 2R3 

Fax 819 762-9325 

2e étage 

1185, rue Germain 

Val-d’Or 

(Québec) J9P 6B1 

Fax 819 874-2522 

Bas-Saint-Laurent 

180, rue des Gouverneurs 

Case postale 2180 

Rimouski 

(Québec) G5L 7P3 

Fax 418 725-6237 

Chaudière-Appalaches 

835, rue de la Concorde 

Saint-Romuald 

(Québec) G6W 7P7 

Fax 418 839-2498 

Côte-Nord 

Bureau 236 

700, boulevard Laure 

Sept-Îles 

(Québec) G4R 1Y1 

Fax 418 964-3959 

235, boulevard La Salle 

Baie-Comeau 

(Québec) G4Z 2Z4 

Fax 418 294-7325 

Estrie 

Place-Jacques-Cartier 

Bureau 204 

1650, rue King Ouest 

Sherbrooke 

(Québec) J1J 2C3 

Fax 819 821-6116 

Gaspésie– 

Îles-de-la-Madeleine 

163, boulevard de Gaspé 

Gaspé 

(Québec) G4X 2V1 

Fax 418 368-7855 

200, boulevard Perron Ouest 

New Richmond 

(Québec) G0C 2B0 

Fax 418 392-5406 

Île-de-Montréal 

1, complexe Desjardins 

Tour Sud, 31e étage 


Succursale Place-Desjardins 

Montréal 

(Québec) H5B 1H1 

Fax 514 906-3200 

Lanaudière 

432, rue De Lanaudière 


Joliette 

(Québec) J6E 7N2 

Fax 450 756-6832 

Laurentides 

6e étage 

85, rue De Martigny Ouest 

Saint-Jérôme 

(Québec) J7Y 3R8 

Fax 450 432-1765 

Laval 

1700, boulevard Laval 

Laval 

(Québec) H7S 2G6 

Fax 450 668-1174 

Longueuil 

25, boulevard La Fayette 

Longueuil 

(Québec) J4K 5B7 

Fax 450 442-6373 

Mauricie et 

Centre-du-Québec 

Bureau 200 

1055, boulevard des Forges 

Trois-Rivières 

(Québec) G8Z 4J9 

Fax 819 372-3286 

Outaouais 

15, rue Gamelin 


Gatineau 

(Québec) J8X 3Y3 

Fax 819 778-8699 

Québec 

425, rue du Pont 


Succursale Terminus 

Québec 

(Québec) G1K 7S6 

Fax 418 266-4015 

Saguenay–Lac-Saint-Jean 

Place-du-Fjord 

901, boulevard Talbot 


Chicoutimi 

(Québec) G7H 6P8 

Fax 418 545-3543 

Complexe du Parc 

6e étage 

1209, boulevard du Sacré- 

Cœur 


Saint-Félicien 

(Québec) G8K 2P8 

Fax 418 679-5931 

Saint-Jean-sur-Richelieu 

145, boulevard Saint-Joseph 


Saint-Jean-sur-Richelieu 

(Québec) J3B 6Z1 

Fax 450 359-1307 

Valleyfield 

9, rue Nicholson 

Salaberry-de-Valleyfield 

(Québec) J6T 4M4 

Fax 450 377-8228 

Yamaska 

2710, rue Bachand 

Saint-Hyacinthe 

(Québec) J2S 8B6 

Fax 450 773-8126 

Bureau RC-4 

77, rue Principale 

Granby 

(Québec) J2G 9B3 

Fax 450 776-7256 

Bureau 102 

26, place Charles-De 

Montmagny 

Sorel-Tracy 

(Québec) J3P 7E3 

Fax 450 746-1036 

54

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