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report of the AUDITOR GENERAL for the year ended 31 March 1978 British Columbia. Legislative Assembly [1982]

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 Province of
British Columbia
report
of the
AUDITOR
GENERAL
for the year ended
31 March 1978
J
  Province of
British Columbia
Office of the
Auditor General
Province of British Columbia
756 Fort Street
Victoria
British Columbia
V8V1X4
The Honourable Evan M. Wolfe
Minister of Finance
Province of British Columbia
Sir:
I have the honour to transmit herewith my Report to the
Legislative Assembly for the fiscal year ended 31 March 1978
for submission to the Assembly in accordance with the
provisions of Section 10(1) of the Auditor General Act,
S.B.C. 1976, Chapter 3.
usfffa"'*'"
Auditor General
Victoria, British Columbia
30 March 1979
  REPORT OF THE AUDITOR GENERAL 5
TABLE OF CONTENTS
Section Page
1. Highlights     7
2. Introduction     9
3. Nature and Extent of Examination  11
4. Report on the Financial Statements  12
5. Legislation  14
6. Stated Accounting Policies  15
7. Internal Control Over Expenditures   17
8. Statement of Assets and Liabilities  22
A. Fund Accounts  22
Fund Accounting Procedures  22
B. General Fund—Revenue Surplus Section  23
Cash  23
Accounts Receivable From Other Governments and Agencies  24
Working Capital Advances  24
Other Current Liabilities  25
Revenue Surplus .  26
C. General Fund—Capital Surplus Section  28
Capital Surplus  28
Analysis of Changes in Capital Surplus  29
Taxes and Other Accounts Receivable  30
Loans and Other Advances  30
Investment in, and Advances to, Crown Corporations  32
Investments, Other.  3 2
Fixed Assets  3 2
D. Special Purpose Funds  34
Housing Fund  34
Lottery Fund  35
Provincial Home Acquisition Fund  36
Provincial Transit Fund  36
E. Superannuation Funds  3 8
F. Trust Funds  39
Courts  39
Public Trustee.  39
9. Guaranteed Debt  40
10. Revenue  42
11. Ministries  43
Ministry of Consumer and Corporate Affairs—
Liquor Distribution Branch  43
 6 REPORT OF THE AUDITOR GENERAL
TABLE OF CONTENTS—Continued
Section Pagb
11. Ministries—Continued
Ministry of Education—
Public School Insurance  43
Ministry of Finance—
Treasury Section  44
Securities Section  45
Consumer Taxation Branch  45
12. Public Bodies  47
13. Organization and Activities of the Audit Office  48
Appendices
I  Sections of the Auditor General Act Relevant to the Responsibilities of the
Auditor General  51
II  Public Bodies of Which the Auditor General was the Appointed Auditor
as at 31 March 1978  54
III Public Bodies, of Which the Auditor General was not the Appointed Auditor, Whose Financial Statements are Included in Section F of the Public
Accounts .  55
IV Sections A (pages A 1 to A 12), B and C of the Public Accounts  56
 REPORT OF THE AUDITOR GENERAL
1    HIGHLIGHTS
A Personal Overview
The Auditor General Act, S.B.C. 1976, chapter 3, imposes three specific
responsibilities on the Auditor General in regard to the accounts of the Government
of the Province.   They are:
—to examine the accounts and records;
—to report on the financial statements as presented in accordance with stated
accounting policies; and
—to report on the work of the Office, calling attention to anything resulting
from the examination which the Auditor General feels should be brought to
the attention of the Legislative Assembly, including certain specified matters
and others which are discretionary or permitted.
Section 3 of this Report deals with the nature and extent of the examination
conducted.
My report on the financial statements for the year ended 31 March 1978, which
has been printed in the Public Accounts, is reproduced in Section 4 herein.
This initial annual report to the Legislative Assembly deals with the background, organization, and activities of my Office. It presents comments and
observations, arising from the examination conducted by my staff, which are additional or supplementary to the considerations on which my report on the financial
statements is based.
The items included have been selected to provide important general information, because of their individual significance, or because they are illustrative of
particular situations.
Major concerns discussed include:
—the urgent necessity for revision of financial legislation to meet contemporary needs;
—the importance of the establishment of, and adherence to, a body of clearly
stated accounting policies, and improved financial statement presentation to
remove present deficiencies and ambiguities;
—the need for correction of serious weaknesses which are evident in the
systems of internal control over expenditures; and
—the significance of the status of substantial debt guaranteed by the Province
which is disclosed only by implication through a note to the financial statements and which, in my opinion, should be included as direct liability of the
Province.
Throughout my examination, excellent co-operation was received from the
various ministry and public body officials, and I wish to express my appreciation to
them.
It is gratifying to note that correction of some of the weaknesses noted is in
progress or is planned. I trust that remedial action will proceed or be undertaken
with the least possible delay.
 8
REPORT OF THE AUDITOR GENERAL
The efforts of my Office will continue to be directed toward meeting, to the
best of its capacity, the requirements as to statutory examination, report and
opinion, and associated obligations in regard to the accounts and statements of
Government and the public bodies of which 1 am the auditor. In addition, I look
forward to extending the scope of the examinations and studies conducted by my
Office to include permissive areas of assessment and report as provided by the Act.
 REPORT OF THE AUDITOR GENERAL
2    INTRODUCTION
Foreword
2.1 This is my first Report submitted to the Legislative Assembly of the Province
of British Columbia in accordance with the provisions of the Auditor General Act,
S.B.C. 1976, chapter 3. It describes the background and statutory responsibilities
of my position, presents the required opinion on the financial statements of the
Government, and reports on the work of my Office, as required by that Act. Within
the permissive provisions of the Act, I also present initial comments on the basis
of presentation and disclosure of the financial statements.
Legislation
2.2 The Auditor General Act was proclaimed in force on 23 June 1977, with
the exception of section 7 and section 21 (e) and (/). These excepted sections
were proclaimed in force on 20 January 1978. Accordingly, my first annual report
is that required on the financial statements of the Government for the fiscal year
ended 31 March 1978.
Financial Statements
2.3 Financial statements are prepared for the purpose of providing summarized
information as to the financial position of an organization at a given point in time,
and the results of its financial activities over a specified period. The Public Accounts
are the medium by which this information is provided for the Province of British
Columbia.
2.4 The magnitude of financial operations summarized in the Public Accounts,
and the special nature of the accountability of governments to the people they
represent, impose a great responsibility on those concerned with the proper maintenance of the records on which they are based and the presentation of the results
in the most accurate and clearly understandable form possible. This responsibility
rests with the Comptroller-General who is the chief accounting officer of the
Government. Responsibility for the accounts and financial statements of public
bodies rests with the management of those bodies. Representations in the financial
statements of the Government and of the public bodies are therefore those of the
Government and of the managements of the public bodies.
Function of the Auditor General
2.5 Governments have long felt the need to appoint an officer independent of the
government of the day and of public officials and employees, to carry out an
examination of the public accounts, and report directly to the elected legislative
entity. The practice is international, and Canada has had an Audit Office since
1878. All of the provinces have, over the years, established such offices. In 1976
the Legislative Assembly enacted the Auditor General Act establishing the position
of Auditor General for the Province of British Columbia. I was appointed as the
first incumbent under that Act, taking office on 1 September 1977.   I am an officer
 10 REPORT OF THE AUDITOR GENERAL
of the Legislature, appointed by the Lieutenant-Governor on the recommendation
of the Legislative Assembly. By the Act I am independent of the Government,
and report directly to the Legislative Assembly.
2.6 One of the primary functions of an auditor is to report on the representations
made by management in the financial statements submitted by it to its constituency.
Such financial statements are a report by management of its stewardship. In the
case of a provincial government, the management is the government of the day.
The financial statements are embodied in the Public Accounts submitted to the
Legislative Assembly.
2.7 To carry out this function the auditor examines such audit evidence as is
deemed appropriate and is available. The examination is conducted in accordance
with professionally established generally accepted auditing standards. The Canadian
Institute of Chartered Accountants pronounces upon these standards. On the
basis of the evidence examined the auditor endeavours to arrive at an opinion as
to the credibility of management's representations, and to the degree of their
compliance with established accounting principles. In most activities other than
those of governments, these are known as "generally accepted accounting principles". Because generally accepted accounting principles have not been established
for governments, it is usual to report on the degree of compliance with stated
accounting policies.
2.8 Under early legislation of other government jurisdictions, it was usual to
restrict the duties required of legislative auditors to those described in the previous
paragraph. More recently it has become accepted that they may, or are required
to, extend their audit functions beyond those traditionally required for the expression
of an opinion, in order to provide additional information for the improvement of
financial management. The concept has also evolved that legislative auditors may
or should extend the scope of their work to include assessments of the degree to
which programs are economically and efficiently administered and the appropriateness of the basis of accounting for fair presentation in the Public Accounts. These
extended duties are included in the areas on which the Auditor General of British
Columbia may report under the Auditor General Act. Future audits and reports,
as the capacity of the Office permits, will be directed toward these areas.
2.9 The text of the sections of the Auditor General Act relevant to the duties
and responsibilities of the Auditor General is included as Appendix I.
 REPORT OF THE AUDITOR GENERAL
11
3 NATURE AND EXTENT OF EXAMINATION
3.1 The nature and extent of my examination in my initial audit was governed
by several factors. They included the legislative requirements of the Auditor
General Act, the size and complexity of the audit entity, the fact that no independent
audit had previously been performed, time constraints, and availability of staff.
3.2 In complying with the requirements of the Act, I decided that the verification
of assets and liabilities, and the assessment of internal controls over revenue and
expenditure were essential. These matters were accordingly given the highest
priority.
3.3 The size and complexity of the financial operations of the Government are
readily apparent. The sections of the Act requiring an opinion on the financial
statements for the fiscal year ended 31 March 1978 were proclaimed on 20 January
1978, at which time my audit staff numbered 20, of whom only six senior staff
members had been with me for more than one month. In addition, the audits of
19 public bodies had been assigned to my Office in December 1977. These facts
all combined to limit the extent of audit coverage possible.
3.4 Initial efforts of my staff were directed toward those functions, within both
the Ministry of Finance and the Office of the Comptroller-General, concerned with
the collection of revenue, the management and custody of cash and investments,
and the maintenance of the centralized accounting systems from which the financial
statements of the Government are prepared. In addition to assessing the controls
exercised by these central agencies, my staff reviewed the major complementary
internal controls established within the ministries. The central offices of all
ministries were visited, as well as a limited number of regional and district offices.
3.5 The audit findings, comments, and recommendations contained in this Report
have been reviewed and discussed with senior officials of the various ministries
directly involved.
 12 REPORT OF THE AUDITOR GENERAL
4    REPORT ON THE FINANCIAL STATEMENTS
My report on the financial statements of the Government, required under
section 7 of the Auditor General Act, has been included in the Public Accounts for
the year ended 31 March 1978.   It reads as follows:
AUDITOR GENERAL'S REPORT
To the Legislative Assembly
of the Province of British Columbia
Parliament Buildings
Victoria, British Columbia
I have examined the financial statements of the Government of the Province
of British Columbia for the year ended March 31, 1978 as presented in the Public
Accounts, and the related schedules contained in Sections B and C of the Public
Accounts.   These statements are:
Statement of Assets and Liabilities as at March 31, 1978.
Notes to Financial Statements.
Summary of Transactions for the Fiscal Year ended March 31, 1978.
Summary of General Fund Revenues for the Fiscal Year ended March
31, 1978.
Summary of General Fund Expenditures for the Fiscal Year ended March
31, 1978.
Statement of Source and Application of Funds for the Fiscal Year ended
March 31, 1978.
These statements and schedules in my opinion constitute the statements of
financial position, the results of operations and changes in financial position referred to in section 7 of the Auditor General Act, S.B.C. 1976, chapter 3.
I did not examine and do not express an opinion on:
Statement of Consolidated Revenue by Major Sources for the fiscal
years ended March 31, 1973 through 1978.
Statement of Consolidated Expenditure by Major Functions for the fiscal
years ended March 31, 1973 through 1978.
The information contained in these statements is supplementary in nature and not
an integral part of the financial statements on which I am required to report.
Except as explained in the following paragraph, my examination was made in
accordance with generally accepted auditing standards, and accordingly included
such tests and other procedures as I considered necessary in the circumstances.
I have received all the information and explanations I have required for the purpose
of my examination.
My Office commenced operations in January 1978, and staff resources and time
available for this initial examination were limited. It was not feasible to satisfy
myself as to the asset and liability position at the beginning of the 1978 fiscal year
and, in addition, an independent audit was not performed for the preceding fiscal
year. As a result of these conditions the extent of my tests and procedures was
insufficient to provide the level of assurance necessary for an unqualified opinion
 REPORT OF THE AUDITOR GENERAL
13
on the financial statements and on the consistency of the accounting bases followed
as between the fiscal years 1977 and 1978.
I have relied upon information furnished by the Consulting Actuary for the
Public Service Superannuation Fund and the Teachers' Pensions Fund as to the
accuracy of Note 4 to the financial statements as presented in the Public Accounts.
I report in accordance with section 7 of the Auditor General Act. In my
opinion, except for the effect of any adjustments which might have been indicated
by a more extensive audit examination, these financial statements present fairly the
financial position of the Government of the Province of British Columbia as at
March 31, 1978 and the results of operations and changes in financial position
for the year then ended in accordance with the stated accounting policies as set out
in Notes 1, 2, 3 and 5 to the financial statements. For the reasons stated, I do not
express an opinion with respect to the consistency of the accounting bases followed
as between the fiscal years 1977 and 1978, nor on the 1977 comparative figures
presented in the financial statements.
It is emphasized that my opinion above is limited under section 7 of the Act
to an opinion on presentation of the financial statements in accordance with the
stated accounting policies of the Government. Under section 8 of the Act I report
separately to the Legislative Assembly on other matters. That report, dated
January 31, 1979, contains a number of comments in regard to accounting policies
and disclosure. The most important of these comments relates to the treatment in
the Government's financial statements of debt of other parties guaranteed by the
Province when the debtor appears unable to meet his obligations. This is of
particular importance this year in relation to debt of British Columbia Railway
Company guaranteed by the Province.
^^\_^T^=^f?y7^^7 ''•
ERMA MORRISON, C.A.
Auditor General
Victoria, B.C.
January 31,1979.
 14
REPORT OF THE AUDITOR GENERAL
5    LEGISLATION
5.1 The two main statutes providing legislative authority and direction for the
administration and control of the financial affairs of the Province are the Financial
Control Act (formerly the Audit Act) and the Revenue Act. Both of these Acts
are outdated, and fail to recognize changed circumstances or to provide essential
statutory definition of duties, responsibilities, and requirements to deal with the
financial activities of the Government in present times and circumstances. The
provisions of the Financial Control Act are basically unchanged from those of the
Audit Act of 1917. No significant amendments of a financial control nature have
been made to the Revenue Act since 1932.
5.2 Legislation to meet current and anticipated requirements in this critical area
is urgently needed, and I recommend that action be taken to provide it without
delay.
 REPORT OF THE AUDITOR GENERAL
15
6    STATED ACCOUNTING POLICIES
6.1 In expressing my opinion on the financial statements, I am required to report
whether they present certain financial information fairly in accordance with the
stated accounting policies of the Government.
6.2 The purpose of a formal statement of accounting policies, as an integral part
of the financial statements, is to provide a clear understanding of the principles and
methods used to present the financial information contained in the statements. Due
to the nature of government accounting, especially when compared to practices
followed in the private sector, the accounting policies stated in the Notes to Financial
Statements have particular importance to a reader who would wish to have an
adequate understanding of the Public Accounts.
6.3 The major accounting policies of the Government are derived from the
provisions of various statutes such as the Revenue Act, the Financial Control Act,
the Supply Act, and other Acts which stipulate policies and practices to be followed
in the administration of some Special Purpose Funds. Certain other policies are
based on conventional accounting practices, while others are formulated at management's discretion.
6.4 A clear and concise description of the significant accounting policies is an
essential element of fair presentation of the financial statements. Inherent in this
is the understanding that all major accounting practices followed will be subject
to the stated policies. It should be noted, however, that an adequate description of
stated accounting policies does not necessarily result in fair presentation of the
financial statements if the policies are not appropriate in the circumstances.
6.5 The auditor, in commenting on the fairness of presentation of the financial
statements, is faced with potential difficulties concerning stated accounting policies.
These include:
—Certain key policies may not be stated, or may not be clear.
—There may be departures from stated policies.
—Stated policies may not result in the most appropriate presentation.
—Changes in accounting policies or major accounting practices, and their
effects, may not be adequately described in the financial statements.
6.6 In the course of my examination examples of all of the above-mentioned
difficulties were encountered, as described below in this section and elsewhere in
my Report.
Policies not Stated or Unclear
6.7    Capital surplus. This account is derived from the recording of the following
asset accounts which appear in the Statement of Assets and Liabilities:
—Taxes and other accounts receivable.
—Loans and other advances.
—Investment in, and advances to, Crown corporations.
—Investments, other.
—Fixed assets.
 16 REPORT OF THE AUDITOR GENERAL
There is no statement of policy concerning the bases upon which assets are included
in Capital Surplus, or how certain transactions affecting Capital Surplus are to be
handled.
6.8 Funds. Policies concerning the treatment of Funds and fund divisions in
the financial statements are unclear in that they do not adequately disclose the
accounting practice followed with respect to pooling of cash and short-term investments.   Further details are contained in Section 8A of this Report.
6.9 Other current liabilities. Although there is a stated policy of accounting
for revenues and expenditures on a cash basis (with certain major modifications),
it does not clearly disclose the accounting treatment of some substantial current
liability items.
Departures From Stated Policies
6.10 Liquor Distribution Branch. Budgetary Revenue of the Province includes net profits of this Branch. These profits are calculated on a full accrual
basis, which does not conform to the stated policy of accounting for Provincial
revenue on a cash basis. In my opinion, the accrual basis is appropriate for this
particular operation. However, attention should be drawn in the Notes to Financial
Statements to this modification of the general policy.
Policies not Resulting in Appropriate Presentation
6.11 Loans and other advances. Appropriate allowances for losses are not
provided in all cases where realization is considered doubtful, and the extent of
loss reasonably determinable.
6.12 Investment in, and advances to, Crown corporations. This classification, shown at cost in accordance with stated policy, does not reflect long-term
diminution of value of certain major investments.
Changes in Policies and Practices
6.13 Major changes in cost allocations. As a result of significant changes
arising from the establishment of the British Columbia Buildings Corporation,
building occupancy charges formerly reported as expenditures of the Ministry of
Highways and Public Works are now being reported as expenditures of individual
user ministries. The effect of this change on the financial statements should have
been disclosed.
6.14 / consider that deficiencies and ambiguities in the content and application
of stated accounting policies are sufficiently serious to warrant a thorough study of
the Government's accounting policies and financial statement presentation.
 REPORT OF THE AUDITOR GENERAL
7    INTERNAL CONTROL OVER EXPENDITURES
17
7.1 In the fiscal year ended 31 March 1978, the Provincial Government reported
General Fund expenditures of approximately $4,000 million. The total movement
of moneys through this and other Funds under the administration of the Government in the course of the year was estimated to be at least three times this figure.
The Government is a large and complex entity, consisting of 18 ministries and
hundreds of responsibility centres.
7.2 In these circumstances it is essential that there be reliable internal controls
to ensure the safeguarding of assets, the reliability of accounting records, and the
presentation of accurate financial information.
7.3 My staff conducted a study and evaluation of the internal controls over
general disbursements and payrolls. Although certain basic controls were found
to be in place in the Comptroller-General's office and in the ministries, in my
opinion they were not sufficient to achieve adequate control. Principal matters
of concern, detailed later in this section, are summarized hereunder:
—Policies, directives, and guidelines in the area of financial management and
control are not clearly defined, nor effectively communicated to individuals
concerned,   (paragraph 7.6)
—Delegation of authority in the disbursement process lacks definition and
regulation, and is inadequately documented,    (paragraphs 7.7 to 7.9)
—Organizations have not adequately segregated duties of individuals for
purposes of better control,    (paragraph 7.10)
—Batch processing controls of documents and other vital controls are seldom
utilized,    (paragraphs 7.11 to 7.13)
—Financial reports from the Office of the Comptroller-General were not
effectively used by most ministries, thus negating the control features
inherent in the reports,    (paragraph 7.14)
—There has been no audit of expenditures by the Internal Audit Division of
the Comptroller-General's office,    (paragraph 7.15)
—The payroll system is inadequate,    (paragraphs 7.16 to 7.20)
—Payroll bank accounts have not been reconciled on a regular or frequent
basis,   (paragraph 7.19)
7.4 Based on these findings, I am of the opinion that the system of internal control over the disbursement of Provincial funds fails to meet generally recognized
standards. I recommend that corrective action to bring controls to an adequate
level be given high priority.
7.5 My findings in this regard are described in further detail in the balance of
this section. Future audits will continue to evaluate the internal controls as to
their adequacy and effectiveness.
 18
REPORT OF THE AUDITOR GENERAL
General Disbursements
7.6 Policies, directives, and guidelines. Since the Government is a large,
decentralized organization it is vital that financial control policies be clearly defined
and that related directives and guidelines be effectively communicated to all those
concerned. To accomplish this there should be clear, concise direction through
readily available financial control manuals. There are no such manuals in use.
Directives on accounting matters from the Office of the Comptroller-General are
usually contained in Audit Memoranda. Treasury Board matters of general interest
are published in Treasury Board Directives. These documents are not appropriately
classified and indexed, and cover only a limited range of financial control subjects.
7.7 Delegation of authority. Proper delegation of authority, clearly documented, is necessary to ensure that only those individuals who have been specifically
authorized to do so may be involved in the acquisition of goods and services, and
payment therefor. Approval by these individuals is the evidence the Office of the
Comptroller-General relies on in processing vouchers for payment. From these
signatures it is assumed that procedures for receiving goods or services have been
observed and that the terms of purchase were complied with. Limitation of the
number of such persons and their level of responsibility provides a key control in
large, decentralized systems.
7.8 From my examination it appears that there is no standard basis for delegating
authority, and no standard format for recording such delegation. Some ministries
have no documented evidence of delegation, while in others, delegation instruments
indicate little discrimination in determining the types or amounts of payments which
may be authorized by various individuals. As a result, some documents may be
passed for payment, even for substantial amounts, on the signature of junior
employees. Often the types or amounts of expenditures which an individual may
approve are not restricted, permitting staff members to be involved with transactions inconsistent with their knowledge and level of responsibility.
7.9 The function of the Voucher Processing Section of the Comptroller-General's
office is to evaluate the propriety of all transactions by review and approval prior
to payment. For the year under review, the Voucher Processing Section had no
systematic and reliable method of ensuring that the signatures on vouchers were
those of persons to whom approval authority had been delegated. Vouchers were
often passed for payment on the basis of personal knowledge of previous transactions.   Few signature cards or similar documents were on file.
7.10 Segregation of duties. Segregation of duties is a method of control
employed to reduce risk of fraud and to detect errors. A purchases/payables/
payments system should be designed so that the same individuals do not participate
in both purchasing or receiving goods and services, and accounting for them. My
staff found that in many branch offices of ministries the same individuals initiated
purchases, received goods or services, and approved payment therefor. In some
smaller offices the lack of segregation of duties was unavoidable because of limited
staff numbers. However, in many cases where segregation could have been
achieved, this control feature has not been recognized in establishing procedures.
 REPORT OF THE AUDITOR GENERAL
19
7.11 Batch processing controls. Batch processing is a system of grouping
and controlling documents in order to ensure that all data transferred to another
location or submitted for processing is actually received and is complete. Control
information determined by the source location prior to processing is reconciled
with information received after processing to ensure its completeness and accuracy.
7.12 In those ministries with decentralized accounting authority, documents
originating from numerous field locations are usually sent directly to the
Comptroller-General's office for processing. This compounds the control problem,
in that these documents have not been subject to review by a central accounting
authority within the ministry.
7.13 In most ministries little attempt is made to ensure that all data is controlled
from one step to the next. Within the Comptroller-General's office no batch controls are implemented until immediately before the data is to be processed by the
computer. Data could be lost, changed, or removed during the numerous processes
before this point. In addition, as discussed more fully later, there is limited user
review of output. Without data controls or detailed user review of output there
is no assurance that incomplete, inaccurate, or unauthorized data will be detected.
7.14 Timely and meaningful reports. Reports supplying information as to
actual disbursements processed are issued to the various ministries by the Comptroller-General's office. Normally such reports would be reconciled to approved
disbursements by the originating offices in order to ensure that the reports received
accurately reflect expenditures for which each office is responsible. Many ministries,
however, have stopped using these reports, preferring instead to rely on their own
internally developed reports which frequently are not reconciled to those issued
centrally. This reliance on internally generated information means that the ministries do not check the financial data reported by the Comptroller-General's office,
thus negating an important check on the basic accuracy of the central accounting
system.
7.15 Internal audit. There is an Internal Audit Division in the Office of the
Comptroller-General. During the period of our review this Division performed
no audits of expenditures due to commitments to revenue, statutory, and other
audit matters. I consider that internal audit of expenditure is essential for adequate
internal control.
Payrolls
7.16 Payrolls are prepared through a centralized computer and manual system
installed essentially in 1966 when there were approximately 25,000 employees on
the Government payroll. At that time there were no collective agreements, and
therefore no accommodation for the peculiarities of specific contracts was required.
Compensation plans were simple enough to allow all salaried and hourly employees
to be paid through the same system.
 20 REPORT OF THE AUDITOR GENERAL
7.17 Since 1966, major changes have occurred in the Government's relationships with its employees. Compensation plans have become complicated, and in
1978 the Government was party to some 30 collective agreements. Remuneration
of approximately 50,000 individuals is processed through the payroll system.
Many alterations have been made to both the computer and manual systems to
deal with the changing requirements. A project to completely redesign and
modernize the system to deal with current circumstances is now in progress.
7.18 During the year under review, it was evident that the total payroll system
was under considerable stress, in both the computer and manual environments.
Pressures on staff to produce payrolls and deliver cheques to employees on a timely
basis have resulted in a weakening of those controls necessary to prevent errors
and irregularities, and those established to ensure that delegated responsibilities
are properly discharged.
7.19 Although some improvements were made during the year, the present
payroll procedures do not ensure sufficient control over these expenditures, nor
can they be relied upon in the future to pay employees on a timely basis. Key
controls which were found to be ineffective or nonexistent include:
—As at 31 March 1978, the payroll bank account had not been reconciled
beyond 31 August 1977.
—Batch controls over documents which transfer key payroll information to,
through, and from the central pay office, the data centre, and numerous
locations throughout the Province, are often lacking. This constitutes a
constant risk that data may be mislaid or changed, or that unauthorized
data may be entered into the processing system.
—Responsibilities for the payroll payment process are not effectively segregated from the responsibilities for maintenance of employee data. Procedures should be designed so that individuals who are able to initiate
changes to employee data should not prepare or process the payroll, handle
cheques, or distribute them to employees. This is particularly important in
a computer environment.
7.20 The serious problems inherent in the payroll system have been recognized
by the Comptroller-General. As mentioned earlier, some improvements have
already been made. Although efforts should be continued to strengthen controls
within the existing system, the total system redesign project should be given
priority.
Financial Management Reporting System
7.21 In order to properly manage their ministries, senior officials need adequate
financial information. The Province's financial information systems were originally
developed primarily to meet legislative requirements, particularly those of the
Financial Control Act. Section 13 of that Act requires that the accounts show the
standing of all legislative appropriations at all times.
 REPORT OF THE AUDITOR GENERAL
21
7.22 The necessity for additional information was recognized some time ago,
and a Financial Management Reporting System was introduced in 1975. This
system reports budgets to the lowest level of program and responsibility centre,
and produces monthly reports of actual expenditures and a comparison with budget.
7.23 Few ministries are using the Financial Management Reporting System
effectively. In at least one large ministry, a parallel system, which includes commitment reporting, has been designed and implemented. In other ministries
systems have been set up, or are contemplated, to overcome the shortcomings of
the present system. This clearly indicates a pressing need for improvements in
the management information systems.
 22 REPORT OF THE AUDITOR GENERAL
STATEMENT OF ASSETS AND LIABILITIES
8A    Fund Accounts
8A.1 The Statement of Assets and Liabilities shows four fund divisions accounted
for by the Government, namely:
—General Fund.
—Special Purpose Funds.
—Superannuation Funds.
—Trust Funds.
8A.2 General Fund. This fund reflects all revenues and expenditures of a
general operating nature, as well as certain nonbudgetary transactions. The net
assets of the General Fund are equal to Revenue Surplus and Capital Surplus
combined, which represent the balance of the fund.
8A.3 Special Purpose Funds. These funds are set aside or earmarked by
legislation for specific purposes. They are not available for the general operations
of the Government.
8A.4 Superannuation Funds and Trust Funds. These funds are administered
by the Government in its fiduciary capacity. They are not available for the general
operating or special purposes of the Government, but are held in trust.
Fund Accounting Procedures
8A.5 For accounting purposes, a fund is defined as a self-balancing entity with
its own assets on the one hand, offset by liabilities and a fund balance on the other.
The presentation of funds in the financial statements of the Province suggests that
the individual funds are accounted for in this manner. In fact, only the assets of
the Sinking Funds, which form part of Trust Funds, are permanently separated
from those of the other funds. On a day-to-day operating basis, cash and temporary
investments of all other funds are intermingled. It is only at a financial statement
date that completely balanced positions are achieved by an accounting entry
allocating cash and investments from the General Fund to the Special Purpose,
Superannuation, and Trust Funds.
8A.6 It is clear that the present method of accounting for the funds does not
meet the generally recognized procedures of fund accounting. Superannuation
and Trust Funds are, by their nature, distinctly separate from the other funds
administered by the Government, and it would be preferable that their assets be
segregated from those of the other funds at all times.
SAT The fact that cash and short-term investments of all funds are pooled during
the year should have been clearly described in the stated accounting policies,
together with an explanation of the bases used to allocate interest income among
the funds.
 REPORT OF THE AUDITOR GENERAL
23
STATEMENT OF ASSETS AND LIABILITIES
8B     General Fund—Revenue Surplus Section
8B.1    The assets and liabilities comprising the Revenue Surplus Section of the
Statement of Assets and Liabilities are:
Assets:
—Cash.
—Temporary investments.
—Accounts receivable from other governments and agencies.
—Working capital advances.
Liabilities:
—Outstanding cheques.
—Accounts payable.
—Other current liabilities.
—Unmatured debt.
I comment more fully on certain of these items in the following paragraphs.
8B.2 It will be noted throughout the balance of this Report that references are
made to specific sections and pages of the Public Accounts. For example, the
Statement of Assets and Liabilities as at March 31, 1978, would be referenced for
convenience as (PA A 2 and A 3). Sections A (pages A 1 to A 12), B and C of
the Public Accounts are included as Appendix IV to this Report.
Cash
8B.3 Cash comprises a number of Government bank accounts for which the
Treasury Section of the Ministry of Finance has general responsibility. The following matters regarding bank accounts were noted.
8B.4 Bank reconciliations. The Financial Control Act requires the Comptroller-General to prepare monthly reconciliations of bank accounts operated by
the Treasury Section. My staff observed that monthly reconciliations were not
performed regularly during the year, thus making it difficult, if not impossible, to
reconcile some accounts at the year-end date. As at 31 March 1978, the payroll
bank account had not been reconciled beyond 31 August 1977. A number of
other accounts contained long-standing unreconciled or unexplained differences.
While none of these was substantial in amount, their existence gives cause for
concern. I am advised at the date of this Report that the bank reconciliations
have been brought up-to-date.
8B.5 Authorization of bank accounts. The Revenue Act states that "all
public moneys . . . shall be paid to the credit of the Minister of Finance,
through such banks or persons as the Minister of Finance may . . . direct and
appoint." Within the Ministry of Finance the Treasury Section keeps a list of
authorized bank accounts. This list is inaccurate in that various changes to the
original banking arrangements, such as signing authorities, have not been updated,
and it is incomplete in that there are various Government bank accounts which
are not listed.
 24
REPORT OF THE AUDITOR GENERAL
8B.6 In view of my comments in Section 7 of this Report concerning internal
control weaknesses, and the risks inherent in the control and management of cash
resources, I strongly urge that bank reconciliations and authorizations be maintained on a current basis in the future.
Accounts Receivable From Other Governments and Agencies
8B.7 The Notes to Financial Statements state that the accounts of the General
Fund are maintained on a cash basis whereby revenues are taken into the accounts
in the fiscal period in which they are received. A major modification to this policy
is described in Note l.A. (a) as follows:
"Moneys received in April of the next following year pertaining to cost-
sharing programs with other governments (principally the Government of
Canada), and for which the relative program expenditures have been charged
to the current year, are included in revenues and shown as accounts receivable
in the statement of assets and liabilities."
8B.8 My examination disclosed that this policy was not fully complied with.
Cash received subsequent to 30 April 1978 amounting to $1,251,657 and returned
cheques not cleared at that date amounting to $797,134 were included in the
amount shown as receivable from sundry agencies and miscellaneous accounts as
at 31 March 1978.
8B.9 The returned cheques referred to consist mainly of NSF cheques, a few
of which date back to 1970. Items such as these that are considered uncollectible
should be deleted from the accounts.
Working Capital Advances
8B.10 Liquor Distribution Branch. The Working Capital Advance of
$4,030,606 represents the excess of assets over liabilities in the accounts of the
Liquor Distribution Branch. These are determined on the accrual basis and therefore contain certain assets and liabilities which would not normally have been
included in the accounts of the Province.
8B.11 Further reference to, and recommendations regarding this Branch are
contained in Sections 6 and 11 of this Report.
8B.12    Queen's Printer.   The operations of the Queen's Printer are governed
by the Public Printing Act, which states in section 11 (1):
"The Queen's Printer shall prepare a statement of accounts made up to the
thirty-first day of March in each year and at such other times as the Minister
may direct, and shall submit the same to the Comptroller-General for his
certification."
8B.13 Although annual statements have been prepared, they have not been
certified by the Comptroller-General in recent years. My staff was informed that
the accounting system was not considered sufficiently reliable to support certification
of the statements.
 REPORT OF THE AUDITOR GENERAL
25
8B.14 The major portion of this advance, for which funds are provided from
the Consolidated Revenue Fund, consists of inventories of material and supplies
which are normally in excess of $1 million. As at 31 March 1978 it was stated
to be approximately $1.2 million. At that date members of my staff attended the
physical stocktaking and performed the audit tests normal to such procedure. The
following deficiencies were noted:
—lack of documented procedures to ensure completeness and accuracy of
the physical stock count;
—failure to maintain perpetual inventory records to provide control over the
material and supplies, work in process and finished goods included in
inventory; and
—lack of clear pricing policy to support assigned inventory values.
8B.15 I am informed that some attempts were made since 1976 to redesign the
accounting system and to install perpetual inventory records, but that no such work
is now in progress. Steps should be taken, without further delay, to remedy the
existing deficiencies by instituting systems and procedures to provide accurate
information for both management and reporting purposes.
Other Current Liabilities
8B.16 This general classification contains a wide variety of accounts of a
liability or suspense nature arising from various types of transactions, and affecting
practically all ministries. The following matters were observed in the course of
my examination.
8B.17 Stated accounting policies. Although there is a stated policy of
accounting for revenues and expenditures on a cash basis (with certain major
modifications), it does not clearly disclose the policy followed with respect to the
following current liability items:
—Holdbacks on construction contracts amounting to $10,022,267 were
charged to expenditures of the 1978 fiscal year. The actual cash disbursements were made in the following fiscal year. Although this is a commonly
accepted practice, it is a departure from the stated policy of accounting.
—Revenue from the sale or lease of Crown lands is only recorded when the
Crown grant transferring title or granting a lease is made. As a result of this
practice, approximately $2.7 million received prior to 31 March 1978 was
deferred, instead of being recorded in revenue as implied in the stated
policy. While this procedure may be technically correct, the opposite
treatment is used when property is acquired by the Province.
8B.18 Suspense accounts. The accounts in this category totalled $13,578,159
as at 31 March 1978. By their very nature, suspense accounts tend to be catchalls
for transactions awaiting completion or clarification. Accordingly, it is important
that control be maintained over these accounts by the ministries and the Office
of the Comptroller-General through a process of regular account reconciliations and
disposition of outstanding items.   I am concerned about the following matters:
 26 REPORT OF THE AUDITOR GENERAL
—Many suspense accounts have not been reconciled or cleared for some time.
In some cases a lack of adequate subsidiary records precludes any form of
reconciliation.
—The suspense account maintained by the Ministry of Forests ($4,925,504
as at 31 March 1978) is supported by subsidiary records maintained in
District Offices. Monthly reconciliations of these records to central control
accounts have not been thoroughly reviewed at ministry headquarters and,
as a result, the accounts contain numerous old balances which should be
adjusted or eliminated.
—Suspense accounts incorrectly include $1,002,540 receivable from the British
Columbia Ferry Corporation for payroll taxes paid on its behalf. This
balance should have been shown in current assets as receivable from the
Corporation.
—As at 31 March 1978, the Rights-of-Way—Highways account included
$96,164 which represented duplicate charges to the appropriations. These
charges arose from failure to adjust the accounts for cheques issued and
subsequently redeposited.
8B.19 Guarantee and performance deposits. As a condition of contracting
with the Government, or engaging in certain businesses, contractors and licensees
are often required to deposit cash or securities which are held by the Government
as a guarantee of performance. If the deposit is in cash it is recorded in Other
Current Liabilities. If, however, the depositor offers a negotiable security as a
deposit it is not recorded in the Provincial accounts, but is noted in memorandum
records only as the property of the depositor.
8B.20 During my staff's examination it was noted that effective control is not
always maintained over securities lodged as deposits. In one instance a security
with $5,000 face value could not be located in the files of one ministry for over
a year. In order to meet the Government's fiduciary responsibility for the safekeeping of such property, I recommend that all securities held as deposits be under
the direct supervision and record keeping of the Securities Section in the Ministry
of Finance.
Revenue Surplus
SB.21 The excess of assets over liabilities of the General Fund is presented
in two sections in the Statement of Assets and Liabilities. The first of these sections
deals with surplus and deficit resulting from operational revenues and expenditures,
and the second with Capital Surplus. This discussion is related to the first section.
Surplus is the balance of revenue less expenditure accumulated to the financial
statement date. If accumulated expenditure exceeds accumulated revenue the
result is a deficit.
8B.22 The Statement of Assets and Liabilities presents both a surplus and a
deficit. The revenue surplus of $216,618,708 is the accumulated excess of revenue
over expenditure during the period 1 April 1976 to 31 March 1978. The deficit
of $261,447,790 was accumulated prior to 1 April 1976.
 REPORT OF THE AUDITOR GENERAL
27
8B.23 The net result of the above balances in the accounts of the Province is
a deficit of $44,829,082, which appears as an untitled amount in the Statement of
Assets and Liabilities.
SB.24 I do not consider that the presentation in the financial statements achieves
the most appropriate disclosure of the deficit in the Province's accounts at 31 March
1978. The balance of $44,829,082 should be identified as "Deficit" in the Statement of Assets and Liabilities, and the balance of $216,618,708 in Revenue Surplus
Account in the Summary of Transactions (PA A9) should be clearly shown to be
"for the period 1 April 1976 to 31 March 1978".
8B.25 Subsequent event. The Revenue Surplus of 1976-77 Appropriation
Act, 1978 referred to in Note 8 to the financial statements was passed subsequent
to the 1978 fiscal year end; consequently it did not affect the financial statements
for that year.
 28 REPORT OF THE AUDITOR GENERAL
STATEMENT OF ASSETS AND LIABILITIES
8C     General Fund—Capital Surplus Section
Capital Surplus
8C.1 Capital Surplus is derived from the recording of certain assets in the
Provincial accounts.   These assets are basically of four kinds:
—taxes receivable, not treated as revenue until received in cash;
—other accounts receivable, which generally record recoverable amounts
previously expended from the Consolidated Revenue Fund;
—long-term investments, loans, and advances arising out of expenditures
from the Consolidated Revenue Fund; and
—fixed assets, adjusted each year to reflect certain additional expenditures
out of the Consolidated Revenue Fund, and depreciation.
8C.2 Certain of these assets are commented on in this section of my Report.
As stated in the Notes to Financial Statements these assets are recorded "for purposes of record only". It should be noted that no cash transactions would be
involved in any of the adjustments recommended.
8C.3 Because there is no precise description or definition of Capital Surplus,
assets in this category have been included on traditional and often arbitrary bases.
I therefore recommend that, in order to present Capital Surplus fairly, the stated
accounting policies concerning this account be more clearly defined both as to
purpose and content.
8C.4 Fixed assets comprise the largest part of Capital Surplus assets. It should
be noted, however, that the amounts shown do not include the whole of the
Province's equity in its fixed assets. Land, buildings acquired by ministries other
than Highways and Public Works, machinery and equipment, motor-vehicles, and
furnishings and equipment acquired through Government expenditures have not
been accounted for as fixed assets, or presented as such in the financial statements.
I comment further in this regard in paragraphs 8C.26 to 8C.31.
8C.5 In general, Capital Surplus assets result from expenditures out of the
Revenue Surplus section of the General Fund. Fixed assets such as highways,
bridges, etc., are acquired through annual expenditures from appropriated moneys.
Similarly, amounts invested in or advanced to Crown corporations, public bodies,
and other entities are provided from either annual or special legislative appropriations. The balance of the Capital Surplus assets (taxes receivable) represents
uncollected revenue amounts pertaining to current and prior years which will be
recorded as budgetary revenue when received in cash.
8C.6 The analysis of changes in Capital Surplus presented in the financial statements (PA B8) does not, I believe, provide sufficient information about significant
transactions. Since these transactions often include the sale or transfer of major
Provincial assets, I consider it desirable that the related elements of each transaction
be grouped so that the net results are clearly shown. A suggested alternative is
presented in the following schedule.
 REPORT OF THE AUDITOR GENERAL
29
Analysis of Changes in Capital Surplus During the Year Ended
31 March 1978
INCREASES
Assets acquired from budgetary  and nonbudgetary expenditures
of the year:
Fixed assets	
$
Investments in and advances to Crown corporations, and other
loans and advances:
Ocean Falls Corporation  2,000,000
T.S. Holdings Ltd. __   13,767
Swan Valley Foods Ltd. (shares)   7,631,250
Sundry loans and advances—net of repayments  6,616,320
Shares in Canadian Cellulose Company Ltd., held as temporary
investments 	
Total
Increase in taxes and other accounts receivable	
Dividend paid by British Columbia Cellulose Company in shares
of various companies     19,849,421
Less advances written off     14,355,123
Additional shares of Swan Valley Foods Ltd., acquired for waiver
of interest on advances 	
British Columbia Resources Investment Corporation shares and
promissory note, received for Crown assets and rights transferred   151,532,935
Less book value of assets transferred    54,794,369
Total increases during the year .
262,089,693
16,261,337
1,824,942
280,175,972
20,677,857
5,494,298
251,000
96,738,566
403,337,693
DECREASES
Depreciation provided on fixed assets	
Write-off of fixed assets transferred to British Columbia Buildings
Corporation:
Net book value of assets transferred	
Less consideration received—promissory note	
Instalment payment received on British Columbia Buildings Corporation promissory note, recorded as budgetary revenue of the
year 	
Write-off of Swan Valley Foods Ltd.  investment and advances:
Book value of shares	
Advances 	
Less consideration received—
Promissory note
297,211,290
143,570,934
Balance of cash held in trust	
Debenture (face value $1,500,000)
8,307,751
4,440,616
12,748,367
2,000,000
161,452
1
2,161,453
9,812,082
153,640,356
10,000,000
10,586,914
 30 REPORT OF THE AUDITOR GENERAL
Analysis of Changes in Capital Surplus During the Year Ended
31 March 1978—Continued
DECREASES—Continued
Repayment of advances received from British Columbia Harbours
Board, recorded as nonbudgetary revenue of the year	
Write-off of investment in Crown Development Corporation	
Total decreases during the year	
2,000,000
1,000
186,040,352
Net increase during the year j    217,297,341
Balance of Capital Surplus—31 March 1977 1 2,524,103,353
Balance of Capital Surplus—31 March 1978 2,741,400,694
Taxes and Other Accounts Receivable
8C.7 The note regarding this item (PA B3) states: "These accounts are included
for record purposes only. The amounts are not taken into revenue until received
in cash." This practice results in annual adjustments of these accounts being made
to Capital Surplus; neither Net Revenue for the year nor the Revenue Surplus
account is affected. Nevertheless, these asset accounts should reflect the best
available estimate of the amounts receivable.
8C.8 My examination indicates that a more accurate statement of receivables
would have been presented had the following items been recognized in the accounts
as at 31 March 1978.
8C.9 Timber royalties and stumpage and grazing fees. These accounts
receivable represent unpaid billings as at 31 March 1978. My staff has estimated
that an amount of $43 million could reasonably have been added to this receivable,
representing timber scalings made in March 1978 and prior months which had not
been billed as at 31 March 1978. Had billings been made on a current basis, it is
estimated that $26 million of the above amount would probably have been collected
and included as revenue in the 1978 fiscal year. Further details in this regard
appear in Section 10 of this Report.
8C.10 Other allowances and adjustments. No provision was made for
estimated doubtful accounts receivable of $6.2 million, nor have adjustments been
made for errors noted by my staff which totalled approximately $1.4 million and
affected various accounts included in this category.
Loans and Other Advances
8C.11 The note to this item (PA B3) states: "These assets are carried at book
value, as the amount of ultimate realization cannot be determined at this date."
8C.12 The loan of $1,592,876 to Southern Okanagan Lands Project has been
fully provided for by a "reserve for losses on realization". I consider that further
provisions for losses are required as described in the following paragraphs. To the
extent that provision has not been made, these assets and, by reflection, Capital
Surplus are overstated as at 31 March 1978.
 REPORT OF THE AUDITOR GENERAL
31
8C.13 Ministry of Economic Development Act. In December 1975, under
authority of this Act, advances to a borrower totalling $2,500,000 were approved.
The terms of repayment called for an instalment of $100,000 on or before 31 March
1977, and thereafter, on each succeeding 31 March, a payment of $300,000 or 50
per cent of the net cash flow from operations, whichever is greater.
8C.14 As at 31 March 1978, no payments had been received by the Province,
and my staff has not been able to find any agreements or authority for delaying
repayment. Steps should be taken either to enforce the terms of this loan agreement or to obtain authorization for deferral.
8C.15 Farm Products Industry Improvement Act. As part of the transactions encompassed in the sale of Swan Valley Foods Ltd., Creston Valley Foods
Ltd. purchased from Swan Valley its plant and processing equipment at Creston,
and issued a debenture for $1,500,000 in payment. Swan Valley Foods Ltd. subsequently assigned this debenture to the Province. It is included in Loans and
Other Advances at the nominal value of $1. I have not been able to determine the
authority for this reduction to the nominal amount. Section 25 (2) of the Revenue
Act requires approval by the Lieutenant-Governor in Council to write off assets in
excess of $200.
8C.16 Pacific North Coast Native Co-operative Loan Act. Loans totalling
$5,500,000 were authorized by the above Act to be made to the Co-operative.
A repayment of $10,708 and proceeds of $67,000 from the sale of fixed assets
have reduced the loan to the present balance.
8C.17 The independent auditors' report on the financial statements of the Cooperative for the year ended 30 April 1978 contains the following qualification:
"The Co-operative has incurred substantial operating losses and has never
made any repayments on its long-term debt. The Co-operative does not have
sufficient working capital to sustain continued losses and its future depends
upon its ability to obtain adequate financing and attain profitable operations."
8C.18 In addition, at 31 March 1978, the Co-operative was in arrears for interest
in the amount of $592,731. Under the circumstances the collectibility of this loan
is questionable, and appropriate provision should be made.
8C.19 Provincial Transit Fund. Advances totalling $10,000,000 were made
to this Fund as nonbudgetary expenditures in the 1977 and 1978 fiscal years. These
advances are shown as an amount receivable in the General Fund. Since the
Provincial Transit Fund (a Special Purpose Fund) is on the cash basis of accounting, no corresponding liability is shown in the fund accounts. Furthermore, it has
no sources of revenue, other than the General Fund, from which to repay advances.
Accordingly, I consider that the advance was not, at 31 March 1978, a realizable
asset of the General Fund.
8C.20 General. A number of other items were noted as being wholly or partially irrecoverable. Because the individual amounts are not considered to be
material for purposes of this Report, they are not described in detail. They should,
however, be reviewed and considered for deletion from the accounts or offset by an
allowance for loss as may seem appropriate in the circumstances.
 32
REPORT OF THE AUDITOR GENERAL
Investment in, and Advances to, Crown Corporations
8C.21 British Columbia Railway Company. The financial statements of the
Company show accumulated operating losses of $255,913,606 as at 31 December
1977, and an over-all deficiency of equity of $9,090,706. In view of forecasts from
various responsible sources as to the financial future of the Company, it appears
that the value of its shares has been completely eroded.
8C.22 In the interests of fair presentation, I recommend that this investment,
consisting of the entire issued capital stock of the Company in the amount of
$185,572,900, be written down to a nominal value of $1.
8C.23 I comment further with respect to debt of the Company in Section 9 of
this Report.
Investments, Other
8C.24    British Columbia Resources Investment  Corporation.     As  at  31
March 1978, all issued shares of this Corporation were held in trust for the
Province. It seems, therefore, that the promissory note and shares of this Corporation totalling $151,532,935 would be more appropriately included in Investments
in, and Advances to, Crown Corporations.
8C.25    Kootenay Dehydrators Ltd.   The Province has an investment of $100,-
000 in the shares of this Company and has guaranteed its loans to a total of
$1,952,000. The Company has received interest reimbursement grants from the
Province amounting to $27,678 in the 1978 fiscal year and $99,410 subsequently.
1 have been advised by ministry officials of concerns as to the viability of this
Company as a self-supporting enterprise. I therefore recommend reappraisal of
the value of this investment and potential loss under the guarantees, with appropriate
action to reflect these as accurately as possible in the accounts and statements of
the Province.
Fixed Assets
8C.26 Stated accounting policy. The only reference to policy on fixed assets
is contained in Note 1 to the financial statements which reads, in part: ". . . the
Province records certain assets for purposes of record only through credits to Capital
Surplus Account. These are: ... and fixed assets." This fails to address the
questions of specific exclusions, basis of valuation, depreciation, or accounting for
sale or disposal.
8C.27 In practice, only highways, bridges, wharves, ferries and ferry landings,
and buildings and furnishings constructed or otherwise acquired by the Ministry
of Highways and Public Works, and reported by that ministry to the Comptroller-
General as fixed assets, are included under this account heading.
8C.28 Assets generally regarded as fixed in nature (including land and buildings),
but acquired by other ministries through current appropriations or through Special
Purpose Funds, are not recorded as fixed assets in the accounts of the Province.
My staff was unable to determine, or even to estimate the amount of fixed asset
 REPORT OF THE AUDITOR GENERAL
33
acquisitions which have not been recorded in prior years. An indication of the
extent of this item is provided in the following figures extracted from expenditure
summaries for the 1978 fiscal year:
($ Millions)
Machinery and equipment  26.7
Motor-vehicles (transport of personnel)      3.7
Office furniture and equipment     3.6
8C.29 In light of the foregoing comments, steps should be taken to clarify the
stated policy regarding fixed assets so that it reflects the practices deemed appropriate in the circumstances.
8C.30 Disposal of fixed assets. Note 3 to the Schedule of Fixed Assets
(PA B5) states: "As of March 30, 1978, assets in the amount of $381,571,109
(at cost) less accumulated depreciation of $84,359,819 were transferred to the
British Columbia Buildings Corporation pursuant to the British Columbia Buildings
Corporation Act."
8C.31 The adjustment referred to constituted the elimination from the accounts
of the Province of all asset values for buildings and furnishings, other than those
identified as pertaining to the Parliament Buildings, Government House, and the
Glendale Laundry. Due to the lack of subsidiary records of buildings and furnishings, it was not possible to identify net book values of particular assets transferred,
or to determine the cost of assets transferred to the British Columbia Buildings
Corporation which had never been recorded as fixed assets in the accounts of the
Province.
 34 REPORT OF THE AUDITOR GENERAL
STATEMENT OF ASSETS AND LIABILITIES
8D     Special Purpose Funds
8D.1 Special Purpose Funds are set aside by legislation for specific purposes,
and are separated from the ordinary operating funds of the Government. They are
listed in PA Bl 1.   I comment on certain of these Funds in the following paragraphs.
Housing Fund
SD.2 The Housing Fund was established in 1973, pursuant to the Ministry of
Municipal Affairs and Housing Act, for the purposes of supervising, acquiring,
developing, maintaining, improving, and disposing of housing within the Province.
8D.3 The purposes of the Fund have, to a large extent, been achieved through
two other organizations: the Housing Corporation of British Columbia (HCBC),
a Crown corporation; and the Central Mortgage and Housing Corporation
(CMHC), a federal agency.
8D.4 The Housing Fund was administered by the Ministry of Municipal Affairs
and Housing during the year under review. Due to the Ministry's relationship
with HCBC in regard to projects administered by HCBC, the Housing Fund has
historically relied on HCBC billings and project cost allocations for accounting
data. For projects undertaken jointly by the Housing Fund and CMHC, CMHC
has been the active partner in the majority of projects. As the active partner,
CMHC is responsible for the administration of the projects, while the Housing
Fund provides a portion of the financing. Included in the agreement with CMHC
is the right to audit, which has never been exercised.
8D.5 The assets of the Housing Fund include inventories of real estate under
development and mortgages receivable arising from the sale of completed properties. The Housing Fund maintains subsidiary records of the Province's share of
costs for federal/provincial partnership projects. These records were not reconciled
to the Housing Fund's control account balance of $17,352,865 at 31 March 1978.
The Fund's share ($1,917,980) of mortgages receivable under the Rural and
Remote Housing Program is not supported by Fund subsidiary records. To establish the correctness of these balances it would have been necessary to rely on CMHC
records. At the time of our review the Fund records had not been reconciled with
those of CMHC.
8D.6 As a result of the deficiencies described in the foregoing paragraph, the
records maintained by the Fund for projects administered by HCBC and CMHC
fail to provide adequate control or complete information. The accounting records
in general are poorly organized, frequently incomplete, and often do not properly
record the transactions which have taken place.
8D.7 Errors were noted during my staff's review of the Housing Fund accounts.
Although their adjustment would have resulted in an increase to the Fund balance
of only $301,000, this represents the net result of several major offsetting transactions.
 REPORT OF THE AUDITOR GENERAL
35
8D.8 The Ministry has recognized this situation and significant improvements
are in progress. Since my audit, meetings have been held by the Ministry with
CMHC, and the Ministry informs me that it expects better information to be provided
on both partnership projects and Rural and Remote Housing mortgages in the
future.
8D.9 A further item noted by my staff during the examination of the Housing
Fund concerned expenditures for professional services which required specific
Treasury Board approval. The Ministry of Municipal Affairs and Housing obtained
professional services from the Housing Corporation of British Columbia. The total
cost of these services was $256,163, of which $175,322 required Treasury Board
approval based on the amounts of the individual projects involved. This approval
was not obtained. The expenditures were charged as "office expense", and "grants,
contributions and subsidies", rather than being properly classified as "professional
services".
Lottery Fund
8D.10 The Lottery Fund was established by authority of section 6 of the
Lotteries Act which states that the Fund is to "be paid all proceeds from the conduct
and operation of lotteries by the Province, or jointly with Canada or other provinces,
or with municipalities, regional districts, and other local government bodies, or
other persons." Sections 6 and 7 of the Act provide for the payment of costs of
administration of the Act, and use of the balance for "cultural or recreational
purposes or for preserving the cultural heritage of the Province or for any other
purpose consistent with the objects of the Western Canada Lottery Foundation."
8D.11 The Western Canada Lottery Foundation was granted Supplementary
Letters Patent on 27 September 1977, expanding the areas for which funds could
be used. The expanded areas now include: "objects of a national, patriotic,
religious, philanthropic, charitable, scientific, artistic, social, professional, sporting,
recreational, social welfare, civic improvement, educational, environmental or con-
servational nature, and to purchase, establish, develop, maintain and operate
facilities, programs and services used or useful in connection therewith."
SD.12 The Lotteries Branch is divided into two sections. The Licensing Section
is concerned with the licensing and regulation of all lottery operations in the Province, except the Federal and Provincial government lotteries. The Western Canada
Lottery Foundation Section is responsible for the distribution of and accounting for
tickets of the Western Express and Provincial lotteries.
8D.13 Revenue totalling $233,630 earned by the Licensing Section was credited
to Budgetary Revenue in the 1978 fiscal year, while its operating costs of approximately $150,000 were charged to the Lottery Fund. It would be more appropriate
and accurate for related revenues and expenditures to be reported through the
same fund.
8D.14 Although the Fund is to "be paid all proceeds" in the words of the Act,
in practice all cash receipts are deposited in the Province's general bank account and
Fund disbursements are made from the same account. The unexpended Fund
balance, therefore, appears only as a liability account in the books of the Province.
 36
REPORT OF THE AUDITOR GENERAL
8D.15 This is the only major Special Purpose Fund which is not credited with
interest income. The potential income is significant, based on the average Fund
balance of approximately $10 million in the 1978 fiscal year. In view of the
Fund's primary revenue source and its stated purposes, it would seem reasonable
that the Fund be credited with the interest earned on its unexpended balance.
8D.16 My staff reviewed the grants made from the Fund during their audit for
the fiscal year ended 31 March 1978, with which period this Report is concerned.
The purposes for which the grants were designated were consistent with the objects
of the Western Canada Lottery Foundation.
Provincial Home Acquisition Fund
8D.17 The Provincial Home Acquisition Fund was established in 1967. At
31 March 1978, the Fund balance was $277,133,149, including $242,047,536 in
mortgages. Approximately 64,000 mortgages have been advanced under three
Acts:
—The Provincial Home Acquisition Act and the Home Purchase Assistance
Act provide second mortgages and grants on first-time purchases of homes.
Mortgages under these Acts totalled $224,888,891 at 31 March 1978.
—The Leasehold and Conversion Mortgage Loan Act provides mortgage
funds for building on Crown land or converting single family homes to
multiple unit dwellings. Mortgages under this Act amounted to $17,158,645
at 31 March 1978.
8D.18 It was noted that no allowance had been made in the accounts for
doubtful mortgages. Loans written off as uncollectible totalled $185,352 in the
1977 fiscal year, and $622,940 in the 1978 year. The Director of the Fund estimates that a reasonable allowance as at 31 March 1978 would have been $3 million
(1.24 per cent of mortgages receivable). Based on the increasing number of bad
debts and foreclosures during the 1978 fiscal year, I believe such a provision should
have been made.
Provincial Transit Fund
8D.19 This Fund was originally established in 1968 under the Burrard Inlet
(Third Crossing) Fund Act with a transfer of $27 million from the Consolidated
Revenue Fund. The enabling legislation is now called the Provincial Transit Fund
Act (1974) and its purposes are stated as "purchasing, constructing, equipping, and
operating such transit facilities or services within the Province as may be required
under that Act."
8D.20 The Provincial Transit Fund is unique among the Special Purpose Funds
which acquire long-term assets in that it does not record such assets, as is done by
the Housing Fund and the Provincial Home Acquisition Fund. It is used simply
as an expenditure vehicle. An intimate knowledge of the Public Accounts would
be required to determine what assets had been acquired from expenditures of this
Fund. The transit facilities acquired are provided for the use of Crown corporations
and municipal transit systems at no cost to those entities.
 REPORT OF THE AUDITOR GENERAL 37
8D.21 Major capital acquisitions of transit facilities made since 1974, largely
from the Provincial Transit Fund supplemented by voted appropriations, were as
follows:
Provincial Transit Fund ($ Millions)
—Burrard Inlet Ferry System (Sea-Bus)   37.1
—Transit Fleet  18.1
55.2
1977 Appropriations
—Burrard Inlet Ferry System (Sea-Bus)     7.1
—Transit Fleet     7.5
14.6
8D.22 Advances of $10,000,000 from the General Fund to the Provincial
Transit Fund are discussed under Loans and Other Advances in Section 8C of this
Report.
8D.23 During their review, my staff found two cases of duplicate payments which
resulted in an understatement of $468,235 of the Fund balance at 31 March 1978.
The first involved a cheque for $446,000 in payment of a land purchase which was
subsequently replaced with a cheque for a different amount. The original cheque
remained outstanding and uncashed from October 1977 to October 1978 when the
error was discovered and the cheque returned for cancellation. The second instance
concerned a duplicate cheque for $22,235 issued in November 1977 which was
cashed by the payee. When the duplicate payment was found, ministry officials
contacted the payee and obtained a reimbursement cheque in November 1978.
 38
REPORT OF THE AUDITOR GENERAL
STATEMENT OF ASSETS AND LIABILITIES
8E     Superannuation Funds
8E.1 In addition to the Public Service Superannuation Fund and the Members
of the Legislative Assembly Superannuation Account included in the financial
statements of the Province, I have audited and reported separately on the following
superannuation and pension funds:
British Columbia Power Commission Superannuation Fund.
British Columbia Railway Company Pension Fund.
College Pension Fund.
Municipal Superannuation Fund.
Teachers' Pensions Fund.
Workers' Compensation Board Superannuation Fund.
 REPORT OF THE AUDITOR GENERAL 39
STATEMENT OF ASSETS AND LIABILITIES
8F    Trust Funds
8F.1 The Government acts in a fiduciary capacity in the safekeeping and administration of certain funds held in trust, as listed in the Schedule of Trust Funds
Balances (PA B15). During their examination of the individual trust accounts, my
staff noted the following matters.
Courts
8F.2 There are 92 local court offices throughout the Province which receive, in
trust, deposits in connection with various legal proceedings. These deposits are
usually transferred to the Provincial Treasury where they are recorded as Trust
Funds. However, certain amounts are retained in local court bank accounts for
direct payment to legal recipients in cases where early disposition of the funds is
expected. As at 31 March 1978, bank confirmations received by my Office
showed $5.8 million on deposit in local court bank accounts. This figure suggests
that fairly substantial amounts, held in local accounts, are not reflected in the
central accounting system, nor in Trust Funds reported in the financial statements.
Public Trustee
8F.3 My staff made a preliminary review, but have not yet conducted a detailed
examination, of the system and records maintained by the Public Trustee. Based
on this limited review, discussions with ministry officials, and observations contained
in the Acting Comptroller-General's report on his audit of the accounts and records
of the Public Trustee for the period from 25 October 1975 to 23 June 1977,1 offer
the following comments.
8F.4 Asset control accounts. The Public Trustee accounts for cash and other
assets on behalf of Intestate Estates, the Official Committee, and the Official
Guardian. Only cash is included in the Public Accounts, while other assets such as
jewellery, real estate, automobiles, securities, and personal effects are recorded only
as memorandum accounts until converted into cash. These noncash assets as at
31 March 1978 were assigned values totalling $27,095,077 in the records of the
Public Trustee. The control account relating to these assets maintained by the
Office of the Comptroller-General showed a balance of $59,747,909. The difference between the balances in the two offices was attributed to a breakdown in
reconciliation procedures caused by data processing problems. While the assets
and corresponding liability are not reflected in the Public Accounts, steps should be
taken to reconcile the accounts and to maintain them on a controlled basis.
8F.5 Investigative teams. It was noted by the Acting Comptroller-General in
his report that single investigators, rather than investigative teams of more than one
individual, were being used to inventory and receipt trust assets. This is unsatisfactory from the standpoint of control, as well as being at variance with the
procedures prescribed by the Ministry of the Attorney-General.
 40
REPORT OF THE AUDITOR GENERAL
9    GUARANTEED DEBT
9.1 The Province has undertaken, under the provisions of various Acts, to
guarantee the repayment of principal and interest on indebtedness incurred by
others. As of 31 March 1978, the Schedule of Guaranteed Debt of the Province
shows guarantees for debts of municipalities and other local governments, Crown
agencies, and resource enterprises totalling $6,288,180,152 net of sinking funds.
9.2 The guarantee of debt generally facilitates the borrowing of money, and may
enable the borrower to obtain funds at a lower cost than would otherwise be
possible. The possibility always exists that a borrower will be unable to repay a loan
and the guarantor will be called upon to honour the contingent liability. Should
that happen, the contingent liability then becomes the direct obligation of the
guarantor. Good financial reporting requires that the obligation be recognized as
a liability in the financial statements of the guarantor immediately it is known that
the borrower is unable to repay the debt from his own resources. My comments
in regard to liability of the Province are based on the foregoing criteria.
9.3 British Columbia Railway Company. As at 31 March 1978, the Public
Accounts show guaranteed debt of the British Columbia Railway Company in the
net amount of $652,760,711.
9.4 The Royal Commission on the British Columbia Railway, in its report dated
25 August 1978 concluded, in part, as follows:
"BCR has borrowed for many years to meet commitments on earlier borrowings and to cover losses; if this practice continues BCR's loss could exceed
$600 million annually by the year 2000 and impair the province's credit. We
recommend that the present total debt of close to $700 million be removed
from BCR's accounts and assumed directly by the province . . .".
9.5 The Railway, in its submission to the Royal Commission, as quoted in Note 6
to the financial statements of the Province, expressed the opinion that the Railway
cannot in the foreseeable future expect to earn sufficient moneys to service let alone
repay its debt.
9.6 Considering the present financial position of the Company, and the forecasts
as to its ability to meet its debt obligations, I am of the opinion that the net debt of
the British Columbia Railway Company guaranteed by the Province should be
recognized as a direct debt, and recorded as such in the accounts of the Province.
9.7 Other guaranteed debts. My general comments as to recognition of direct
liability apply also to certain other smaller debts guaranteed by the Province where
the circumstances are such that the debtor cannot reasonably be expected to repay.
9.8 Calculation of net guaranteed debt. The net outstanding guaranteed debt
of $6,288,180,152 shown in the Public Accounts comprises $6,913,656,916 gross
outstanding debt less $625,476,764 in sinking funds. Note 1 to the Schedule of
Guaranteed Debt (PA B17) states that gross debt would have been increased by
approximately $169 million had accrued interest been included. The sinking fund
figures reported include accrued interest of approximately $11 million.    For the
 REPORT OF THE AUDITOR GENERAL
41
sake of consistency, interest should be treated on the same basis in both gross
guaranteed debt and sinking funds. I consider that this schedule would provide
better disclosure if accruals were used in both cases. This treatment would also be
consistent with that used in regard to the Province's direct unmatured debt in the
Statement of Assets and Liabilities as described in Note 1A (c) to the financial
statements.
 42
REPORT OF THE AUDITOR GENERAL
10    REVENUE
10.1 My examination included a review of the systems of internal control over
the collection and recording of major Provincial revenues. In the course of this
review it came to my attention that abnormal delays had occurred in the billing of
timber royalties and stumpage fees. These delays were attributed to problems
encountered with a new computerized billing system in the Ministry of Forests.
As a result an estimated $26 million of revenue, which otherwise would have been
collected in the 1978 fiscal year, was collected and recorded as revenue in the
following fiscal year.
J
 REPORT OF THE AUDITOR GENERAL
11     MINISTRIES
43
11.1 In this section I comment on matters which came to my attention concerning
specific ministries of the Government, and which have not been dealt with elsewhere
in this Report.
Ministry of Consumer and Corporate Affairs
Liquor Distribution Branch
11.2 During the year my staff reviewed the accounts and records of the Branch,
and its systems and procedures. In general the accounting systems and procedures
were found to be inadequate for today's business environment. As a result the
information flowing from them lacked many elements important to management
for the purposes of operational control. In December 1977, based on submissions
from the Branch, the Treasury Board also recognized such deficiencies and approved
$1.6 million for the development of new management information systems. Although
there was little indication of progress during the audit period, my staff has since
observed that work on the improvement of systems has been given priority, and
that considerable progress has been made.
11.3 Recommendations to the Branch arising from the audit included:
—establishment of formal plans and budgets in order to measure operating
performance against defined objectives;
—expansion of scope of the internal audit function to include the audit of
accounting systems and warehouse operations; and
—improvement of various accounting controls.
11.4 Branch management has recognized the problems identified, and is presently
in the process of implementing improved procedures.
11.5 Comments on the accounting treatment in the Provincial accounts with
respect to the Liquor Distribution Branch appear in Section 8B of this Report.
Financial statements of the Liquor Distribution Branch for the fiscal year ended
31 March 1978 are contained in Section F of the Public Accounts.
Ministry of Education
Public School Insurance
11.6 Prior to 1974 the responsibility for obtaining fire and general insurance
protection for public schools throughout the Province was undertaken by the Boards
of Trustees of individual School Districts. The cost of insurance was met out of
School District operating funds. On 1 January 1974 the insurance of all public
school property was placed with the Insurance Corporation of British Columbia
(ICBC) and, commencing in the 1975 fiscal year, the Ministry of Education began
paying the required premiums for insurance on public schools out of the current
year's appropriations.
 44 REPORT OF THE AUDITOR GENERAL
11.7 As a result of the Province increasing the insurance deductible amount
through two stages (from $1,000 to $1,000,000 on 1 March 1976, and from
$1,000,000 to $5,000,000 on 1 March 1977) and thereby assuming a larger obligation for self-insurance, premium refunds became due to the Province and were
recognized as a liability by ICBC. The two increases in deductible amounts resulted in premium reductions of $4,757,752 and $3,703,691 respectively.
11.8 These amounts were never reimbursed to the Province, but were held by
ICBC and formed, in effect, a fund from which disbursements of an insurance claim
or property protection nature were made at the direction of the Ministry of Education. To the fund so created the Ministry transferred $633,372 from the 1978
appropriations, and ICBC added interest of $784,870. The accounts of ICBC
record $2,690,483 as a liability to the Province as at 31 March 1978. No corresponding account receivable exists in the accounts of the Province.
11.9 The over-all effects of these transactions were:
—Due to changes in insurance coverage, insurance premiums paid to ICBC
from moneys appropriated by the Legislature for the 1976 and 1977
fiscal years were greater than was required for that purpose.
—The premium overpayments were not returned to the Consolidated Revenue
Fund but were held to the credit of the Province by ICBC.
—The fund so created, arising from moneys appropriated for specific fiscal
years, was used in subsequent years without being charged to votes or
appropriations of those later years.
11.10 In my opinion the fund balance should be returned to the Consolidated
Revenue Fund.
Ministry of Finance
Treasury Section
11.11 The Treasury Section of the Ministry of Finance is responsible for the
banking of all Provincial revenue, overseeing all bank accounts, distributing
cheques, and controlling and distributing the Government stock of law stamps,
permits, and licences. This Section also reconciles the main bank accounts of the
Province.
11.12 My staff reviewed compliance with applicable legislation, and evaluated
and tested the accounting system, procedures, and controls. The principal areas of
concern are commented on in the following paragraphs.
11.13 Bank accounts. The Revenue Act requires that all public moneys be
deposited in bank accounts as directed by the Minister of Finance. The Treasury
Section exercises this authority on behalf of the Minister and maintains lists of bank
accounts and cheque signatories. The cheque signatories list has not been kept
current, and many cases were found of Government bank accounts having been
set up without proper authorization.
 REPORT OF THE AUDITOR GENERAL 45
11.14 Bank reconciliations. The Treasury Section prepares the reconciliations
of the major Government bank accounts. Reconciliations were not kept up-to-
date, and unresolved and sometimes long-standing differences existed in a number
of these accounts.   Further comments appear in Section 8B of this Report.
Securities Section
11.15 The Securities Section is responsible for the investment, custody, administration, and accounting for short-term and long-term securities which totalled over
$5,000 million at 31 March 1978. These are the security investments of the
General and Special Purpose Funds, and those held on behalf of Superannuation
Funds, Trust Funds, and other funds administered by the Province in a fiduciary
capacity.
11.16 My audit of the Securities Section disclosed a number of weaknesses in
organization and supervision, internal controls and accounting records.
11.17 One notable result of these weaknesses came to my attention when my
staff carried out their first physical count and reconciliation of securities in the last
week of January 1978. At that time it was ascertained that securities in bearer form
totalling $1 million, which had been sent to the issuer for registration in November
1977, had never been received by the issuer. The securities had apparently been
misdirected in mailing, and were subsequently recovered. No loss was incurred
by the Province, but it is of concern to me that this error could remain undetected
for a period in excess of two months.
11.18 It appears that many of the Section's past problems arose from insufficient
supervisory staff, and deficiencies in its computerized systems. In recent months
progress has been made toward correcting these problems. In view of the complexity and responsibilities of this Section, I urge that efforts in this area continue to
be given high priority.
Consumer Taxation Branch
11.19 A number of procedures and controls used to monitor the collection and
receipt of taxes by the Consumer Taxation Branch were found to need considerable
improvement.   My main concerns are outlined below.
11.20 Cash handling. Procedures used for receiving and recording cash and
cheques totalling approximately $987 million in taxes annually need considerable
improvement to reach a desirable standard.
11.21 Accounts receivable and collections. Accounts receivable arise mainly
from the work of the Audit and Collections Section of the Branch. Of the total
recorded receivables of $6,305,314 at 31 March 1978, approximately 53 per cent,
or $3.3 million, is considered doubtful of collection. This high percentage is
attributed to incomplete records, collection difficulties, and the age of the accounts.
There had been no write-offs since 1975.
 46
REPORT OF THE AUDITOR GENERAL
11.22 Fuel taxes. My review indicated that tax audit coverage was not sufficiently comprehensive to ensure adequate monitoring and collection of fuel taxes.
Revenue from this source amounted to approximately $189 million in the 1978
fiscal year. Fuel tax audits are currently performed by personnel whose main
efforts are directed toward audits under the Social Services Tax Act. The volume
of revenue generated by fuel taxes requires a concentration of audit effort, and
consideration should be given to supplying specialized staff for this purpose. Of
particular concern are the frequency of audits, and the audits of truckers' rebates,
transactions between oil companies, common storage facilities for fuels with
different tax rates, and marked fuel.
 REPORT OF THE AUDITOR GENERAL
47
12    PUBLIC BODIES
12.1 A "public body", as defined in section 1 of the Auditor General Act, means:
(i)  an agency of the Crown, or
(ii) a board, commission, council, or other body of persons, whether or
not incorporated, all the members of which or all the members of the
board of management or board of directors of which are appointed by an
Act, an order of the Lieutenant-Governor in Council, or a minister of
the Crown, or
(iii) a corporation, more than 50 per cent of the shares or ownership of
which is, directly or indirectly, vested in the Crown, or
(iv) a corporation, association, board, commission, or society to which a
grant or advance of public money is made, or the borrowings of which
may be guaranteed by the Crown under the authority of any Act.
12.2 Nineteen audits of public bodies previously performed by the Comptroller-
General were transferred to the Auditor General on 15 December 1977 by Order
in Council under section 18 of the Auditor General Act. Six additional audits were
later assigned to me, resulting in a total of 25 public body audits for which I was
responsible as at 31 March 1978. The assets and annual expenditures of these
public bodies total approximately $3,500 million and $1,250 million respectively.
A list of the public bodies of which I have been appointed the auditor appear as
Appendix II.
12.3 Included in Section F of the Public Accounts are financial statements of a
number of public bodies of which I am not the auditor. These are listed in
Appendix III to this Report.
12.4 The Liquor Distribution Branch, which was formerly audited and reported
on by the Comptroller-General as a separate body, has been audited for the year
ended 31 March 1978 by my Office. I have not reported on this Branch separately
as it is a Branch of the Ministry of Consumer and Corporate Affairs and as such is
included in the audit and report on the general accounts of the Government.
12.5 Three public body audits still remain the responsibility of the Comptroller-
General, or persons designated by him.   They are:
British Columbia Development Corporation.
British Columbia Systems Corporation.
T.S. Holdings Ltd.
In all cases these entities have been audited and reported on by firms of public
accountants.    In view of the Comptroller-General's responsibilities, which are
internal to the Government, it would seem more appropriate to completely divorce
external and internal audit responsibilities.
 48 REPORT OF THE AUDITOR GENERAL
13    ORGANIZATION AND ACTIVITIES OF THE
AUDIT OFFICE
Organization and Personnel
13.1 My appointment as Auditor General became effective on 1 September 1977.
The four months following my assumption of office were necessarily devoted to the
basic requirements of planning and organizing, as there was no pre-existing organization or transfer of personnel. Concurrently, an extensive recruiting program was
established, with the objective of engaging experienced professional accountants for
the more senior positions, and individuals of high potential for less senior positions
in the Office. This is a most time-consuming and difficult process, but one of the
highest importance as the ultimate success of the Office depends on the quality
of its staff.   I feel that to date this endeavour has been most successful.
13.2 Since inception, the policy established for the Office is to require that all
members of the audit staff either possess a recognized accounting qualification, or
be actively pursuing a course of study toward such qualification. This general
policy has been successfully followed by the Legislative Auditors of the other
provinces, and by the Auditor General of Canada. At 31 December 1978, 21 members of my professional staff were members of professional accounting associations.
In addition, 20 students-in-accounts were following programs leading to such
qualifications.
13.3 In June 1978, following an extensive review and assessment of the standards
and programs of the Office, the Institute of Chartered Accountants of British
Columbia approved the Office for the registration of students in its training program.
This recognition has greatly helped in the development of our professional objectives, and the success of our recruiting efforts.
13.4 The functions of the Office of the Auditor General are comparable to those
of a major firm engaged in the professional practice of public accounting. Therefore, I have considered it appropriate to organize the Office along lines similar to
those of such firms. A factor in the plan of organization has been the requirement
that suitable ratios of senior to junior staff be established to ensure that high professional standards are maintained commensurate with the performance of audits
in a cost-effective manner.
13.5 I am assisted in the over-all direction and administration of the Office by
the following senior officers:
Robert J. Hayward, C.A., Deputy Auditor General.
Frank Barr, C.A., Audit Director.
Gordon W. Dawson, C.A., Audit Director.
 REPORT OF THE AUDITOR GENERAL 49
13.6    The staff complement at 31 March 1978 and projected to 31 March 1979
is summarized hereunder:
Actual Projected
31 March 31 March
1978 1979
Senior management    4 6
Managers and supervisors      7 15
Auditors     3 10
Other audit staff  10 24
Total professional staff
Administrative staff	
24
4
55
5
28
60
13.7 The eventual size and composition of our staff will depend on many factors
yet to be determined or assessed.   These will include:
—the degree of reliance placed on systems of internal and managerial control
throughout the Government;
—the geographic dispersion of functions and operations of ministries;
—the exposure and sensitivity of transactions to error and fraud;
—the extent of involvement in special assignments; and
—the reliance on assistance from outside sources.
Audit Activities
13.8 On 16 January 1978, members of my staff began auditing the Provincial
accounts, and those of certain public bodies of which I am the auditor. The difficulties faced by professional accountants in the initial audit of such large enterprises
are considerable. The fact that the accounts of the Province had never before been
subject to an independent examination of this nature compounded the difficulty of
that assignment.
13.9 A number of the public bodies audited by my staff, such as the Workers'
Compensation Board, The University of British Columbia, Simon Fraser University, the University of Victoria, the British Columbia Institute of Technology, and
the Medical Services Plan of British Columbia are complex and substantial audits.
13.10 I emphasize these points in order to stress my appreciation of the extra
effort and devotion to duty shown by the members of my staff in achieving the
results they have, under difficult circumstances and over a relatively short span of
time.
13.11 In the early stages of development, my staff resources were insufficient
to perform these audits in a timely manner and at an acceptable level of coverage.
This gap was bridged by making extensive use of the services of public accounting
firms, who provided professional staff to work under the direction of my own
personnel.   I wish to express my appreciation to both the staff and firms involved.
 50
REPORT OF THE AUDITOR GENERAL
13.12 While the requirements for outside help will gradually diminish as the
capabilities of my Office are built up, there will be continued need to rely on the
private sector for assistance and advice in areas where special expertise is required.
Advisory Council
13.13 I have been assisted by a small group of highly qualified and respected
members of the accounting profession who served as an Advisory Council. I wish
to acknowledge with appreciation their advice, which was of great assistance to me
in resolving some of the extremely difficult problems I encountered in formulating
my opinion on the financial statements.
Canadian Legislative Auditors' Conference
13.14 Since 1973 the legislative auditors of all the provinces, and the Auditor
General of Canada, have met annually to discuss matters of common interest and
concern. Prior to my appointment, the Comptroller-General represented the
Province at these meetings.
13.15 The sixth annual Conference of Legislative Auditors was held in Edmonton on 25-27 September 1978. It was my honour to serve as General Chairman of
the Conference this year. Guest speakers included the Hon. Peter Lougheed,
Premier of Alberta; John D. Heller, Assistant to the Comptroller General, U.S.
General Accounting Office; and Kenneth J. Sharp, Head of the Government
Accountancy Service, Great Britain. Some 40 senior members of the various offices
attended, including four from this Office.
In Memoriam
13.16 The sudden death on 23 July 1978 of Donald Barry Wallace, C.A., an
Audit Manager on the staff of this Office, saddened his many friends. Although he
was with the Office for only some six months, he will long be remembered for his high
ethical and moral standards, professional competence, enthusiasm, and warm, good
nature. My condolences and those of my staff are extended to Mrs. Wallace and
their family.
 REPORT OF THE AUDITOR GENERAL
51
APPENDIX I
Sections of the Auditor General Act Relevant to the
Responsibilities of the Auditor General
Examination of Accounts
6. (1) The auditor general shall examine in such manner as he considers necessary the
accounts and records of the Government relating to the Consolidated Revenue Fund and all
public money, including trust and special funds under the management of the Government,
and to public property.
(2) Notwithstanding any other Act, the auditor general
(a) shall be given access to the records of account and administration of any
ministry, and
(b) may require and receive from any person in the public service, information,
reports and explanations necessary for the performance of his duties.
Report on Financial Statements
7. (1) The auditor general shall report annually to the Legislative Assembly on the financial
statements of the Government, including those required by section 40 of the Financial Control
Act, respecting the fiscal year then ended.
(2) The report shall form part of the Public Accounts and shall state
(a) whether he has received all of the information and explanations he has required, and
(Z>) whether in his opinion, the financial statements present fairly the financial
position, results of operations and changes in financial position of the Government in accordance with the stated accounting policies and as to whether they
are on a basis consistent with that of the preceding year.
(3) Where the report of the auditor general does not contain the unqualified opinion
required under this section, the auditor general shall state the reasons why.
Annual Report
8. (1) The auditor general shall report annually to the Legislative Assembly on the work of
his office and call attention to anything resulting from his examination that he considers should
be brought to the attention of the Legislative Assembly including any case where he has
observed that
(a) accounts have not been faithfully and properly kept or public money has not been
fully accounted for, or
(b) essential records have not been maintained, or
(c) the rules, procedures, or systems of internal control applied have been insufficient
(i) to safeguard and protect the assets of the Crown, or
(ii) to secure an effective check on the assessment, collection and proper
allocation of the revenue, or
(iii) to ensure that expenditures have been made only as authorized, or
(iv)  to ensure the accuracy and reliability of the accounting data, or
(d) public money has been expended for purposes other than for which it was appropriated by the Legislature.
(2) In the report the auditor general may also include an assessment
(a) as to whether the financial statements of the Government are prepared in
accordance with the most appropriate basis of accounting for the purpose of
fair presentation and disclosure, or
(b) as to whether any program being administered by a ministry is being administered
economically and efficiently.
Trivial Matters
9. The auditor general need not report to the Legislative Assembly on any matter he considers
immaterial or insignificant.
 52
REPORT OF THE AUDITOR GENERAL
Tabling Annual Report
10. (1) A report of the auditor general to the Legislative Assembly shall be submitted by him
through the Minister of Finance.
(2) Upon receipt of a report of the auditor general, the Minister of Finance shall lay the
report before the Legislative Assembly as soon as possible.
(3) If the Minister of Finance does not lay the report before the Legislative Assembly
on the first sitting day following the receipt of the report by him, the auditor general shall
transmit the report to the Speaker and the Speaker shall lay the report before the Legislative
Assembly.
(4) Upon being laid before the Legislative Assembly, the annual report of the auditor
general shall be referred to the Public Accounts Committee of the Legislative Assembly.
Special Report
11. The auditor general may at any time make a special report to the Legislative Assembly on
a matter of primary importance or urgency that, in his opinion, should not be deferred until
he makes his annual report.
Other Reports
12. The auditor general may at any time make a report to the Minister of Finance, the Treasury
Board, the Lieutenant-Governor in Council, or any public officer on any matter that in the
opinion of the auditor general should be brought to his or their attention.
Special Assignments
13. The auditor general may undertake special assignments at the request of the Lieutenant-
Governor in Council, but he is under no obligation to carry out any such requested assignment
if, in his opinion, it would interfere with his primary responsibilities.
Stationing Officers in Ministries
14. (1) The auditor general may station in any ministry a person employed in his office to
enable him more effectively to carry out his duties, and the ministry shall provide the necessary
office accommodation for a person so stationed.
(2) The auditor general shall require every person employed in his office who is to
examine the accounts or the administration of a ministry pursuant to this Act to comply with
any security requirements applicable to, and to take any oath of secrecy required to be taken
by, persons employed in that ministry.
Inquiry Powers
15. The auditor general may examine any person on oath on any matter pertaining to his
responsibilities and for the purpose of such an examination the auditor general has all the
powers, protection and privileges of a commissioner under sections 7, 10 and 11 of the
Public Inquiries Act.
Public Bodies
16. (1) Notwithstanding any other Act, where the auditor general is not the auditor of a
public body,
(a) the public body shall, on the request of the auditor general, supply the auditor
general with a copy of all financial statements and reports relating to the public
body,
(b) the auditor of the public body shall, on the request of the auditor general, make
available to the auditor general, within a reasonable time, all working papers,
reports and other documents in his possession relating to the public body, and
(c) the auditor general may conduct such examinations of the records and operations
of the public body as he considers necessary or advisable to carry out his duties
under this Act.
(2) Notwithstanding any other Act, the auditor general
(a) shall be given access to the records of account and administration of any public
body, and
(b) may require and receive from any officer or employee of a public body information reports and information necessary for the performance of his duties.
J
 REPORT OF THE AUDITOR GENERAL
53
Eligibility as Auditor
17. Notwithstanding any other Act, the auditor general is eligible to be appointed the auditor,
or a joint auditor, of a Crown corporation, Crown agency, or public body.
Transfer of Audit Duties
18. The Lieutenant-Governor in Council may transfer to the auditor general the duty imposed
by any Act on the comptroller-general to conduct an audit.
 54
REPORT OF THE AUDITOR GENERAL
APPENDIX II
Public Bodies of Which the Auditor General was the Appointed
Auditor as at 31 March 1978
♦British Columbia Assessment Authority
British Columbia Educational Institutions Capital Financing Authority
♦British Columbia Harbours Board
British Columbia Heritage Trust
British Columbia Institute of Technology
British Columbia Power Commission Superannuation Fund
British Columbia Railway Company Pension Fund
♦British Columbia Regional Hospital Districts Financing Authority
♦British Columbia School Districts Capital Financing Authority
Captain Cook Bi-Centennial Committee
College Pension Fund
Creston Valley Wildlife Management Area Trust Fund
♦Legal Services Commission
♦Medical Services Plan of British Columbia
Municipal Superannuation Fund
Pacific Vocational Institute
Provincial Capital Commission
♦Provincial Rental Housing Corporation
Simon Fraser University
Teachers' Pensions Fund
The University of British Columbia
The University of British Columbia Health Sciences Centre
University of Victoria
♦Workers' Compensation Board of British Columbia
Workers' Compensation Board Superannuation Fund
• Included in Section F of the Public Accounts.
 REPORT OF THE AUDITOR GENERAL
55
APPENDIX III
Public Bodies, of Which the Auditor General was not the Appointed Auditor,
Whose Financial Statements are Included in Section F of the Public Accounts
British Columbia Buildings Corporation
British Columbia Cellulose Company
British Columbia Development Corporation
British Columbia Ferry Corporation
British Columbia Health Care Research Foundation
British Columbia Housing Management Commission
British Columbia Hydro and Power Authority
British Columbia Petroleum Corporation
British Columbia Railway Company
British Columbia Steamship Company (1975) Ltd.
British Columbia Systems Corporation
Canadian Cellulose Company, Limited
Health Facilities Association of British Columbia
Housing Corporation of British Columbia
Insurance Corporation of British Columbia
Kootenay Forest Products Ltd.
Ocean Falls Corporation
Panco Poultry Ltd.
Plateau Mills Ltd.
T.S. Holdings Ltd.
Vancouver Resources Board
 56
REPORT OF THE AUDITOR GENERAL
APPENDIX IV
Sections A (pages Al to A12), B and C
of the Public Accounts
 PUBLIC ACCOUNTS 1977/78
SECTION A
MAIN FINANCIAL STATEMENTS OF THE PROVINCE
CONTENTS
Page
Statement of assets and liabilities as at March 31, 1978  A   2
Notes to financial statements  A   4
Report of the Auditor General  A    7
Summary of transactions for the fiscal year ended March 31, 1978 (General
Fund and Special Purpose Funds)  A   9
Summary of General Fund revenues for the fiscal year ended March 31,
1978  A 10
Summary of General Fund expenditures for the fiscal year ended March 31,
1978  A 11
(Where appropriate, comparative figures for the preceding year are given.)
 A 2 PROVINCE OF BRITISH COLUMBIA
STATEMENT OF ASSETS AND
(with comparative figures
ASSETS
Net increase
or (decrease)
1978 1977 during 1977/78
General Fund $ $                        $
Cash   2,134,949 17,660,827 (15,525,878)
Temporary investments    467,333,172 273,349,807 193,983,365
Accounts   receivable   from   other   governments and agencies   23,631,007 50,919,790 (27,288,783)
Working capital advances    8,909,831 9,416,158         (506,327)
502,008,959       351,346,582    150,662,377
Taxes and other accounts receivable  71,371,084 50,693,227 20,677,857
Loans and other advances (note 2)   53,539,815 49,202,658 4,337,157
Investment in, and advances to, Crown corporations (notes 3 and 6)  386,841,069 275,275,747 111,565,322
Investments, other   151,718,489 26,067,805 125,650,684
Fixed  assets   2,077,930,237 2,122,863,916 (44,933,679)
3,243,409,653 2,875,449,935 367,959,718
Special Purpose Funds
Cash                    20,209 305,193 (284,984)
Investments             237,612,176 157,569,246 80,042,930
Other assets         399,196,778 414,925,420 (15,728,642)
636,829,163 572,799,859 64,029,304
Superannuation Funds
Cash                .      ....                   10,621 20,830 (10,209)
Investments         573,867,624 479,303,442 94,564,182
573,878,245 479,324,272 94,553,973
Trust Funds
Cash and investments       739,451,785 622,051,305 117,400,480
5,193,568,846 4,549,625,371 643,943,475
Notes:
The notes on pages A 4 to A 6 are an integral part of this statement.   Detailed schedules
of the Asset and Liability accounts can be found in Section B.
 PUBLIC ACCOUNTS 1977/78
LIABILITIES AS AT MARCH 31, 1978
as at March 31, 1977)
LIABILITIES
1978
General Fund $
Outstanding cheques           92,417,903
Accounts payable        147,030,787
Other current liabilities         45,941,561
285,390,251
Unmatured debt—
Deficit repayment   261,447,790
Other       —
Less sinking funds    —
261,447,790
Excess of assets over liabilities—
Revenue surplus (note 8)      216,618,708
Deficit at March 31, 1976, funded    (261,447,790)
(44,829,082)
Capital  surplus   2,741,400,694
2,696,571,612
3,243,409,653
Special Purpose Funds
Fixed capital funds—
Capital accounts    90,000,000
Current accounts   8,016,805
Other funds     534,280,208
Miscellaneous statutory accounts   4,532,150
636,829,163
Superannuation Funds (note 4)
Public Service          572,276,598
Members of the Legislative Assembly  1,601,647
573,878,245
Trust Funds
Miscellaneous trust deposits       739,451,785
5,193,568,846
Guaranteed Debt
Debt of municipalities, other local governments, and Crown agencies, etc., guaranteed by the Province (net)  (note 6)  6,288,180,152
Commitments (note 5)
A 3
Net increase
or (decrease)
1977 during 1977/78
$ $
82,703,277
152,248,168
40,265,407
9,714,626
(5,217,381)
5,676,154
275,216,852  10,173,399
261,447,790    —
422,150   (422,150)
(422,150)   422,150
261,447,790
76,129,730 140,488,978
(261,447,790)    —
(185,318,060) 140,488,978
2,524,103,353 217,297,341
2,338,785,293 357,786,319
2,875,449,935 367,959,718
90,000,000
7,024,861
472,149,176
3,625,822
991,944
62,131,032
906,328
572,799,859  64,029,304
478,012,366  94,264,232
1,311,906    289,741
479,324,272  94,553,973
622,051,305 117,400,480
4,549,625,371 643,943,475
5,484,270,450
LIONEL G. BONNELL, C.A.
Comptroller-General
 A 4
PROVINCE OF BRITISH COLUMBIA
NOTES TO FINANCIAL STATEMENTS
1. Accounting
For purposes of the financial statements, funds or accounts held in trust and those set
aside or earmarked for specific or special purposes are segregated from the general operating
accounts of the government. Thus the accounts are presented in four separate fund divisions—
General, Special Purpose, Superannuation and Trust—as shown in the Statement of Assets
and Liabilities. The accounting policies and practices employed in the four divisions are
summarized below:
A. General Fund
The accounts of the General Fund are maintained on a cash basis whereby revenues are
taken into the accounts in the fiscal period in which they are received and expenditures are
charged when the actual payments are made. The financial statements reflect this cash-basis
accounting, but with the following major modifications:
(a) Moneys received in April of the next following year pertaining to cost-sharing
programs with other governments (principally the Government of Canada), and
for which the relative program expenditures have been charged to the current
year, are included in revenues and shown as accounts receivable in the statement
of assets and liabilities.
(b) Accounts payable at March 31 for which cheques are issued during April of the
next following year are included in current-year expenditures and are shown as
accounts payable in the statement of assets and liabilities.
(c) Interest accrued on the unmatured deficit repayment debt at March 31 is included
in budgetary expenditure and shown in other current liabilities in the statement
of assets and liabilities.
General Fund revenues and expenditures are separated into two distinct categories:
(a) Budgetary transactions: All regular revenues and all ordinary expenditures of
government. These are reported in the form of and are compared with the
annual Estimates of Revenue and Expenditure as authorized by the Legislature.
(b) Other, nonbudgetary transactions: Any extraordinary revenues of significant
amount and all nonbudgetary expenditures and surplus appropriations, such as
appropriations of moneys to and recoveries of balances from Special Purpose
Funds, and capital investment in and advances to Crown corporations, boards,
etc.
The overall net revenue or expenditure of the General Fund for a fiscal period increases
or decreases the Revenue Surplus Account of the Province.
In addition to the operational or current assets and liabilities and the unmatured debt, the
Province records certain assets for purposes of record only through credits to Capital Surplus
Account. These are: Taxes and other accounts receivable which are not included in Revenue
until received in cash, loans and other advances, investments in and advances to Crown corporations, etc., and fixed assets.
B. Special Purpose Funds
The accounts of all Special Purpose Funds are maintained on a cash basis with the exception of the Housing, Lottery and Provincial Home Acquisition Funds, wherein mortgage loans,
accounts and advances receivable, and investments in real estate, as well as investments in and
advances to housing corporations are not charged to expenditure accounts but are capitalized
and shown as assets of the respective Funds.
C. Superannuation Funds and Trust Funds
The individual Funds in these categories are maintained on a cash basis.
2. Loans and Other Advances
Loans and other advances are carried as assets at book value (net of reserves in certain
cases), as the amount of their ultimate realization cannot be determined at this date.
3.  Investment in and Advances to Crown Corporations
The interest of the Province in its Crown corporations is shown in the financial statements
only to the extent of the amounts actually invested in or advanced to them; thus accumulated
earnings (or deficits) of these organizations are not reflected therein. Financial statements of
Crown corporations and other Government agencies are presented in Section F of this
publication.
 PUBLIC ACCOUNTS 1977/78
A 5
4. Superannuation and Pension Plans
A. Public Service Superannuation Plan
This plan is financed by employee contributions, matching employer contributions, and
additional employer contributions paid at the time each allowance is granted for any shortfall
between the actuarial present value of the allowance and the accumulated employee and matching employer contributions.
Under the Public Service Superannuation Act, an actuarial valuation of the plan is required
to be conducted at least once every five years. The most recent valuation was conducted as
at March 31, 1977.
In that report the actuary indicated that, if the plan were financed on the entry age normal
basis, a basis frequently employed by private pension plans, there would be an actuarial liability
as at March 31, 1977, of about $154 million in respect of basic benefits. In the actuary's
opinion, aggregate statutory contributions, as described above, will exceed entry age normal
contributions and he has estimated that these contributions will be sufficient to fully amortize
the $154 million actuarial liability over a period of approximately 20 years if all actuarial
assumptions are realized.
Allowances in payment are automatically adjusted quarterly to reflect increases in the
Consumer Price Index. Such pension supplements are financed on an approximate "pay-as-
you-go" basis by contributions of one-half per cent of salary by both employees and employer.
Actuarial liabilities associated with such increases are not funded under the statutory financing
provisions, but there is provision for both employee and employer contributions to be increased
to 1 per cent of salary when required to maintain the financing on a "pay-as-you-go" basis.
There is no statutory provision for any additional contributions beyond this to finance these
post-retirement supplements even though it is possible that in future such contributions would
be required to maintain financing on the "pay-as-you-go" basis. The actuary reported that as
at March 31, 1977, there was an actuarial liability of $37 million in respect of the pension
supplements granted up to that date.
B. Teachers' Pensions Plan
Under the Teachers' Pensions Act the Province is responsible for the employer contributions to the Teachers' Pensions Fund administered by the Commissioner of Teachers' Pensions;
these contributions are included in the budgetary expenditures of the Ministry of Education.
A report on the administration of the plan and fund is made annually to the Legislature.
This plan is financed by teacher contributions, matching Government contributions, and
additional Government contributions made to ensure that at any time the assets in the fund are
at least equal to the actuarial present value of all allowances which are in effect and the total
amount of contributions, accumulated with interest, held in the fund on behalf of "teachers in
respect of whom no allowance has been granted.
Under the Teachers' Pensions Act, an actuarial valuation of the plan is required to be
conducted by an actuary at least once in each consecutive five-year period. The most recent
valuation was conducted as at December 31, 1974. In that report the actuary recommended
that the statutory basis of contributions be strengthened so that contributions, in future, would
be sufficient to fully finance benefits for all new entrants to the plan and to hold the actuarial
liability constant as a percentage of future teacher payroll. On this basis, he advised that the
actuarial liability was $468 million for basic benefits. An actuarial valuation is presently being
conducted as at December 31, 1977, and the actuary expects to submit his report by February
28, 1979. Preliminary indications are that the actuarial liability at December 31, 1977, will
increase to about $550 million from the $468 million at December 31, 1974.
Discussions are continuing between Government and teachers as to the manner in which
the recommended increase in contribution rates should be achieved and no change has yet been
made.   Any such change would require amendment of the Act.
Allowances in payment are automatically adjusted quarterly to reflect increases in the
Consumer Price Index. Such pension supplements are financed on an approximate "pay-as-
you-go" basis by contributions of 1 per cent of salary by both teachers and Government.
Actuarial liabilities associated with such increases are not funded under the statutory financing
provisions. There is no statutory provision for any additional contributions to finance these
post-retirement supplements even though it is possible that in future such contributions would
be required to maintain financing on the "pay-as-you-go" basis.
5. Commitments
No provision is made in the accounts for commitments under construction or other contracts in force at the year-end. Such future expenditures are charged to appropriations in the
years in which the work or service is performed.
 A 6
PROVINCE OF BRITISH COLUMBIA
6. British Columbia Railway Company
The Province holds the entire issued share capital of the Railway and, pursuant to the
British Columbia Railway Company Construction Loan Act, the Province guarantees the payment of the principal and interest of all moneys borrowed by the Railway. The investment and
guarantee are shown in the financial statements under
(a) Investment in and advances to Crown corporations:
The investment is carried at the historical cost of the shares, $185,572,900.
(See note 3 above.)
(b) Guaranteed debt:
The outstanding debt of the Railway at March 31, 1978, net of sinking funds
held, aggregated $652,760,711.
The financial statements of the Railway at December 30, 1977 (reproduced in Section F
of this report) show that the net overall shareholder's position is a deficit of $9,090,706 after
recording a net loss for the year then ended of $58,291,395. The Railway in a submission to
the Royal Commission (see below) stated that "Substantial debt relief is required. B.C. Railway cannot in the foreseeable future expect to earn sufficient moneys to service let alone repay
this debt." The annual interest and debt repayment charges will average approximately $69
million over the next five years.
By Order in Council dated February 7, 1977, a Royal Commission was appointed "to
make inquiry into and concerning all aspects of the management and development of the British
Columbia Railway and the participation of the Crown therein as shareholder," including a
particular inquiry into "the foreseeable financial requirements of the Railway for all purposes."
The final report of the Commission was submitted to the Government on August 28, 1978, and
is currently under review. An addendum dealing with specific statutory revisions to give effect
to its recommendations has not yet been received.
7. Anti-inflation Legislation
The Province is subject to controls on compensation instituted by the Government of
Canada pursuant to an agreement entered into under the Anti-Inflation Measures Act (1976,
chap. 1), effective June 21, 1976.
8. Revenue Surplus Appropriation
Pursuant to the Revenue Surplus of 1976-77 Appropriation Act, 1978, $76,129,730 of the
Revenue Surplus Account has been appropriated for specific purposes.
 PUBLIC ACCOUNTS 1977/78
A 7
AUDITOR GENERAL'S  REPORT
To the Legislative Assembly
of the Province of British Columbia
Parliament Buildings
Victoria, British Columbia
I have examined the financial statements of the Government of the Province
of British Columbia for the year ended March 31, 1978, as presented in the Public
Accounts, and the related schedules contained in Sections B and C of the Public
Accounts.   These statements are:
Statement of Assets and Liabilities as at March 31, 1978.
Notes to Financial Statements.
Summary of Transactions for the Fiscal Year ended March 31, 1978.
Summary of General Fund Revenues for the Fiscal Year ended March
31, 1978.
Summary of General Fund Expenditures for the Fiscal Year ended March
31, 1978.
Statement of Source and Application of Funds for the Fiscal Year ended
March 31, 1978.
These statements and schedules in my opinion constitute the statements of
financial position, the results of operations and changes in financial position referred to in section 7 of the Auditor General Act, S.B.C. 1976, chapter 3.
I did not examine and do not express an opinion on:
Statement of Consolidated Revenue by Major Sources for the fiscal years
ended March 31, 1973, through 1978.
Statement of Consolidated Expenditure by Major Functions for the fiscal
years ended March 31, 1973, through 1978.
The information contained in these statements is supplementary in nature and
not an integral part of the financial statements on which I am required to report.
Except as explained in the following paragraph, my examination was made
in accordance with generally accepted auditing standards, and accordingly included such tests and other procedures as I considered necessary in the circumstances. I have received all the information and explanations I have required for
the purpose of my examination.
My office commenced operations in January 1978, and staff resources and
time available for this initial examination were limited. It was not feasible to
satisfy myself as to the asset and liability position at the beginning of the 1978 fiscal
year and, in addition, an independent audit was not performed for the preceding
fiscal year. As a result of these conditions, the extent of my tests and procedures
was insufficient to provide the level of assurance necessary for an unqualified
opinion on the financial statements and on the consistency of the accounting bases
followed as between the fiscal years 1977 and 1978.
I have relied upon information furnished by the Consulting Actuary for the
Public Service Superannuation Fund and the Teachers' Pensions Fund as to the
accuracy of Note 4 to the financial statements as presented in the Public Accounts.
 A 8
PROVINCE OF BRITISH COLUMBIA
I report in accordance with section 7 of the Auditor General Act. In my
opinion, except for the effect of any adjustments which might have been indicated
by a more extensive audit examination, these financial statements present fairly
the financial position of the Government of the Province of British Columbia as
at March 31, 1978, and the results of operations and changes in financial position
for the year then ended in accordance with the stated accounting policies as set
out in Notes 1, 2, 3, and 5 to the financial statements. For the reasons stated,
I do not express an opinion with respect to the consistency of the accounting bases
followed as between the fiscal years 1977 and 1978, nor on the 1977 comparative
figures presented in the financial statements.
It is emphasized that my opinion above is limited under section 7 of the Act
to an opinion on presentation of the financial statements in accordance with the
stated accounting policies of the Government. Under section 8 of the Act I
report separately to the Legislative Assembly on other matters. That report, dated
January 31, 1979, contains a number of comments in regard to accounting policies
and disclosure. The most important of these comments relates to the treatment
in the Government's financial statements of debt of other parties guaranteed by the
Province when the debtor appears unable to meet his obligations. This is of
particular importance this year in relation to debt of British Columbia Railway
Company guaranteed by the Province.
Erma Morrison, C.A.
Auditor General
Victoria, B.C.
January 31, 1979.
 PUBLIC ACCOUNTS 1977/78
A 9
SUMMARY OF TRANSACTIONS FOR THE FISCAL YEAR ENDED
MARCH 31, 1978
GENERAL FUND
Revenue $ $
Budgetary revenue        4,055,491,833
Nonbudgetary revenue .....     — -        84,251,098
4,139,742,931
Expenditure
Budgetary expenditure     — 3,895,464,582
Nonbudgetary expenditure          103,789,371
3,999,253,953
Net Revenue for the year   I.....         140,488,978
Revenue Surplus Account1
Balance at beginning of year
76,129,730
Balance at end of year          216,618,708
SPECIAL PURPOSE  FUNDS
Revenue and Credits
Transfers from General Fund—
Budgetary expenditure—
Ministry of Agriculture (Vote 97)  	
Ministry of Municipal Affairs and Housing (Vote 199)
Nonbudgetary expenditure     	
Interest on investments and loans
Other receipts 	
Expenditure
Grants—
Fixed-capital (perpetual)  funds .
Other funds 	
Miscellaneous statutory accounts
Expenditures—
Fixed-capital (perpetual) funds ..
Other funds    	
Miscellaneous statutory accounts
Net Increase in funds  	
Balance of funds at beginning of year
7,148,611
4,342,302
15,134
11,506,047
111,341
59,558,623
3,656,513
28,381,594
16,000,000
6,665,099
51,046,693
37,726,944
50,088,191
138,861,828
74,832,524
64,029,304
572,799,859
Balance at end of year (page B 11)            636,829,163
iNot including deficit at March 31,  1976. $261,447,790 funded pursuant to the British  Columbia Deficit
Repayment Act, 1975-76.
 A 10 PROVINCE OF BRITISH COLUMBIA
SUMMARY OF GENERAL FUND REVENUES FOR THE FISCAL YEAR
ENDED MARCH 31, 1978
(With comparative figures for the preceding fiscal year.)
Estimated,
1978                                                                                                                                           1978 1977
$                Budgetary Revenue                                                                      $ $
20,400,000    Property taxes           21,562,622 21,738,190
980,500,000    Social services, fuel taxes, etc       987,175,258 889,194,512
1,443,500,000    Corporation, personal, succession, and gift taxes 1,287,193,360 1,124,181,413
451,390,000    Privileges, licences, and natural resources taxes
and royalties           712,949,614 500,339,740
55,800,000    Sales and service fees         57,310,264 45,908,951
8,500,000    Fines and penalties          10,377,029 9,295,256
12,000,000    Interest, discount, premium, and exchange         34,896,363 16,494,886
627,810,000    Contributions from other governments       707,418,676 671,730,802
203,000,000    Contributions from Government enterprises .....     195,677,062 211,054,141
27,000,000    Miscellaneous   ...:        40,931,585 39,965,588
3,829,900,000 Total budgetary revenue    4,055,491,833    3,529,903,479
Nonbudgetary Revenue
Government of Canada contribution to assist in
the construction of Dease Lake rail line  79,852,785 —    • *
Interest earned on above     1,315,295 —
Recovery of advance to B.C. Harbours Board .... 2,000,000 —
Proceeds  on  windup   of  Consolidated   Sinking
Fund         1,083,018 —
Sale of ferry vessels    — 48,442,000
Recovery of special purpose fund balances  — 29,760,388
Recovery of an advance to a special purpose fund — 10,800,000
Total nonbudgetary revenue    84,251,098 89,002,388
Combined General Fund Revenues    4,139,742,931 3,618,905,867
Details of revenue are shown on pages C 2 and C 3.
■
 PUBLIC ACCOUNTS 1977/78
A 11
SUMMARY OF GENERAL FUND EXPENDITURES  FOR THE
FISCAL YEAR ENDED MARCH 31,  1978
(With comparative figures for the preceding fiscal year.)
Estimated,
1978
$
3,580,426
119,810,768
713,648
107,689,915
147,108,802
7,086,857
45,543,610
64,569,333
64,294,319
8,560,926
104,025,393
336,012,897
947,709,405
981,237,356
569,826,615
223,017,301
35,540,134
8,633,118
54,939,177
3,829,900,000
1978
Budgetary Expenditure $
Legislation       5,280,369
Auditor General   344,966
Ministry of Finance   134,297,718
Executive Council     691,125
Ministry of the Provincial Secretary and Travel
Industry   114,832,084
Ministry of the Attorney-General   152,669,696
Ministry of Economic Development  .. ;': ! ., 10,220,302
Ministry of the Environment   45,520,646
Ministry of Agriculture   55,671,527
Ministry of Energy, Transport and Communications    80,456,445
Ministry of Mines and Petroleum Resources   ... 7,974,777
Ministry of Forests   100,849,814
Ministry of Highways and Public Works .  431,021,965
Ministry of Education      940,584,501
Ministry of Health   954,710,057
Ministry of Human Resources   545,140,791
Ministry of Municipal Affairs and Housing  215,567,548
Ministry of Labour ...........   39,613,181
Ministry of Consumer and Corporate Affairs ..... 8,630,049
Ministry of Recreation and Conservation   51,387,021
Total budgetary expenditure „       3,895,464,582
Nonbudgetary Expenditure Charged
to Current Revenue
Special purpose funds—
Appropriation to funds 	
Advances to a fund 	
1,665,099
5,000,000
6,665,099
19771
$
3,345,188
127,727,355
553,458
88,352,267
118,510,162
.    4,537,262
38.987,412
54,875,367
103,400,069
7,148,147
87,866,010
378,160,016
854,546,043
857,980,426
481,011,458
219,038,162
18,096.869
6,261,259
41,032,809
3,491,429,/39
6,000,000
5,000,000
11,000,000
Crown corporations—
Advances     2,000,000
Investments       7,631,250
Grants     85,668,080
312,505
32,600.000
95,299,330 32,912,505
Other-
Book adjustment to capital surplus account
Elimination of publication services working
capital account 	
Transfer of investment in Canadian Cellulose Company Ltd. shares to British Columbia Resources Investment Corporation
in exchange for noncash asset (promissory
note)      *	
Total nonbudgetary expenditure
1,824,942
1,824,942
103,789.371
2,873,008
4,560,885
7,433,893
51,346,398
Combined General Fund Expenditures     3,999,253,953     3,542,776,137
Details of expenditures are shown on pages C 4 to C 12.
1 The 1977 figures have been restated to reflect reorganizational changes between ministries made in the fiscal
year 1976/77, pursuant to the Constitution Act.
 A  12 PROVINCE OF BRITISH COLUMBIA
STATEMENT OF SOURCE AND APPLICATION OF FUNDS FOR THE
FISCAL YEAR ENDED MARCH 31, 1978
GENERAL FUND
Source $ $
Budgetary revenue      4,055,491,833
Nonbudgetary revenue           84,251,098
  4,139,742,931
Application
Budgetary expenditure    ... 3,895,464,582
Nonbudgetary expenditure         103,789,371
  3,999,253,953
Net Funds Received accounted for by the increase in current position during the
year  :.. .=,__           140,488,978
$
Increase in current assets (page A 2)     150,662,377
Less increase in current liabilities  (page
A 3)        10,173,399
140,488,978
SPECIAL  PURPOSE  FUNDS
Source
Transfers from General Fund              51,046,693
Interest and other receipts            87,815,135
Decrease in other assets (net) .              15,728,642
154,590,470
Application
Grants and other expenditures     —        74,832,524
Increase in investments             80,042,930
154,875,454
Net Cash Applied accounted for by the decrease in cash position during the year
(page A 2)         (284,984)
■.-•■.
 PUBLIC ACCOUNTS 1977/78
SECTION B
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES
CONTENTS
Page
General Fund—-
Assets  B 2
Liabilities    B 6
Capital and Revenue Surplus Accounts  B 8
Special purpose funds—
Assets  B 9
Summary of transactions and balances of funds  B 11
Superannuation funds—
Assets    B 12
Summary of transactions for the year ended March 31, 1978  B 14
Trust funds—assets, fund balances  B 15
Guaranteed debt    B 16
Details of unmatured debt  B 18
 B 2
PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES
AS AT MARCH 31, 1978
(With comparative figures as at March 31, 1977.)
GENERAL FUND ASSETS
Cash
Cash on hand	
Cash in chartered banks in Canada	
Cash in banks in England (converted at current rate).
Cash in banks in United States (U.S. dollars)	
1978
$
7,323
1,536,805
264,942
325,879
2,134,949
Temporary Investments
Revenue Act, sec. 9 (at cost).
Securities at par value—
Short-term   deposits   with   chartered   banks,
trust companies, etc.—
Banque Canadienne Nationale   —
Bank of British Columbia..   11,929,194
Bank of Montreal      56,669,858
Bank of Nova Scotia   59,302,280
British Columbia Central Credit Union...... 3,327,500
Canadian Commercial Industrial Bank  1,000,000
Canadian Imperial Bank of Commerce  141,424,153
Mercantile Bank of Canada   4,011,020
Northland Bank  1,000,000
Provincial Bank of Canada   3,084,000
Royal Bank of Canada     63,373,117
Toronto Dominion Bank    96,662,597
Yorkshire Trust Company..   —
Other-
British Columbia Buildings Corporation
notes -  	
1British  Columbia  Development  Corporation note	
1British Columbia Hydro and Power Authority parity bonds	
2Export Development Corporation notes...
3Procan Ltd. notes 	
Less excess of par value over cost.
Stocks   (book   value)—Canadian   Cellulose
Company Ltd., 278,100 common shares.—
i Province of British Columbia guarantee.
2 Government of Canada guarantee.
3 Provincial Bank of Canada guarantee.
1977
$
8,330
17,167,467
219,537
265,493
7,283,684
10,500,000
41,736,926
43,038,338
21,000
43,372,651
11,230,847
5,321,400
50,821,377
34,645,300
2,000,000
441,783,719      249,971,523
2,000,000
19,808,112
20,000,000
9,000
981,161 —
4,770,090 —
467,543,970 271,779,635
210,798 254,770
467,333,172 271,524,865
— 1,824,942
Total securities at cost, above     467,333,172 273,349,807
Net increase
or (decrease)
during 1977/78
$
(1,007)
(15,630,662)
45,405
60,386
17,660,827       (15,525,878)
467,333,172       273,349,807        193,983,365
 PUBLIC ACCOUNTS 1977/78 B 3
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GENERAL FUND ASSETS—Continued
1978
Accounts Receivable From Other Governments and Agencies, $
etc.
Government of Canada—re shared-cost program         11,647,116
British Columbia Buildings Corporation         4,646,566
British Columbia municipalities—re shared-cost program        4,175,885
Sundry agencies and miscellaneous accounts          3,161,440
Working Capital Advances
Langford Warehouse	
Liquor Distribution Branch	
Workers' Compensation Board	
Queen's Printer	
Miscellaneous advances—ministries..
Taxes and Other Accounts Receivable
Note—These   accounts  are  included   for   record  purposes  only.
The amounts are not taken into revenue until received in cash.
Property taxes	
Social services tax	
Corporation capital tax	
Insurance premiums tax	
Logging tax	
Mining and mineral land tax 	
Probate fees and succession duties	
Timber royalty and stumpage and grazing fees	
Social and health agencies	
Student-aid loans	
Teacher-training loans..
8,909,831
10,603,456
6,305,314
1,124,803
2,512
2,733,249
457,830
4,726,315
32,507,826
691,059
41,864
9,306
Farmers' land-clearing, domestic water, and irrigation
drainage assistance	
Land sales (principal)	
Sundry  	
11,633,525
533,771
254
71,371,084
1977
$
43,158,929
5,052,552
2,708,309
9,416,158
10,395,027
3,464,864
792,201
10,172
2,956,313
215,101
6,299,923
15,865,441
41,864
9,306
10,218,941
423,966
108
50,693,227
Net increase
or (decrease)
during 1977/78
(31,511,813)
4,646,566
(876,667)
453,131
23,631,007 50,919,790       (27,288,783)
274,601
287,900
(13,299)
4,030,606
4,902,791
(872,185)
245,000
245,000
—
1,406,799
1,377,187
29,612
2,952,825
2,603,280
349,545
(506,327)
208,429
2,840,450
332,602
(7,660)
(223,064)
242,729
(1,573,608)
16,642,385
691,059
1,414,584
109,805
146
20,677,857
Loans and Other Advances
Note—These assets are carried at book value, as the amount of
ultimate realization cannot be determined at this date.
School districts, library districts, improvement districts,
and local areas (recoverable through rural
property tax collections, mainly in next following year)—
Various school districts         25,056,000 23,552,100
Various regional library districts         1,125,924 1,141,801
Various improvement districts  1,619,384 1,526,626
Miscellaneous     118,342 86,903
Dyking districts, co-operative associations, and other—
Various dyking districts    — 20,718
Various water and irrigation districts   342,337 382,418
Various co-operative associations, etc  29,038 44,757
Various enterprises re economic development—
Ministry of Economic Development Act   3,320,800 3,320,800
Farm Products Industry Improvement Act  2,265,846 4,507,366
Pacific North Coast Native Co-operative Loan Act.. 5,422,292 5,450,000
1,503,900
(15,877)
92,758
31,439
(20,718)
(40,081)
(15,719)
(2,241,520)
(27,708)
 B 4
PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GENERAL FUND ASSETS—Continued Netincrease
or (decrease)
1978 1977 during 1977/78
Loans and Other Advances—Continued                                                       $ $ $
Provincial Transit Fund       10,000,000 5,000,000 5,000,000
Southern Okanagan Lands Project         1,592,876 1,592,901 (25)
University Endowment Lands Administration Account....        4,184,887 4,184,887 —
Sundry                  54,965 5,000 49,965
55,132,691 50,816,277 4,316,414
Less reserve for losses on realization—
Various dyking districts              — 20,718 20,718
Southern Okanagan Lands Project         1,592,876 1,592,901 25
Investment in, and Advances to, Crown Corporations
British Columbia Buildings Corporation—advances	
British Columbia Cellulose Company—
Entire issued capital stock of two common shares...
Advances 	
2British   Columbia   Development   Corporation—entire
issued capital stock of 250,000 common shares	
British   Columbia   Ferry   Corporation—entire   issued
capital stock of 58,497 shares of $100 each	
British Columbia Harbours Board, advances	
British   Columbia   Railway   Company—entire   issued
capital stock of 1,855,729 shares of $100 each	
British Columbia Steamship Company (1975) Ltd.—
entire issued capital stock of five common shares	
Crown Development Corporation—entire issued capital
stock of 10 common shares (1977 only)  	
I.O.K. Poultry Ltd.—100 per cent interest, 600 common shares at cost  	
Ocean Falls Corporation—
Amount paid to the corporation pursuant to the
Ocean Falls Corporation Appropriation Act,
1973, for the purpose of acquiring the mill
and other properties at Ocean Falls   789,952
Advances         6,000,000
Panco Poultry Ltd.—
Entire issued capital stock of 101,750 common
and 11,027 preferred shares    4,800,000
Plateau Mills Ltd.—97.5 per cent interest, 8,775 common shares at cost (1977 only)   —
T. S. Holdings Ltd.—
Entire issued capital stock of one common share  1
Advances               3,918,282
789,952
4,000,000
4,800,000
7,663,256
1
3,904,515
2,000,000
(7,663,256)
13,767
386,841,069       275,275,747       111,565,322
lPursuant to the British Columbia Buildings Corporation Act (Order in Council 763/78), the British Columbia Buildings
Corporation issued a noninterest bearing promissory note to the Province dated March 30, 1978, in the amount of $143,570,934
payable in 29 semiannual instalments, in payment for the completed buildings transferred to the Corporation by the Province.
The Corporation paid the first Instalment due March 31, 1978, in the amount of $10,000,000. As buildings under construction
are completed, further notes are to be issued to the Province in consideration of expenditures made by the Province on such
buildings prior to transfer to the Corporation.
2 In addition to its investment in the capital stock of the British Columbia Development Corporation, the Government
has advanced the corporation $20,000,000 repayable March 31, 1979. This advance is included in Temporary Investments
(page B2).
53,539,815
49,202,658
4,337,157
133,570,934
—
133,570,934
2
2
14,355,123
(14,355,123)
25,000,000
25,000,000
5,849,700
21,338,693
5,849,700
23,338,693
(2,000,000)
185,572,900
185,572,900
—
5
5
—
—
1,000
(1,000)
600
600
—
 PUBLIC ACCOUNTS 1977/78
B 5
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GENERAL FUND ASSETS—Continued
1978
Investments, Other $
British Columbia Resources Investment Corporation—
Shares	
Note    	
Chef Ready Foods Ltd.—33.33 per cent interest, 10,000
common shares at cost	
Kootenay Dehydrators Ltd.—
33.33 per cent interest, 2,000 common shares at cost.
Entire   issued  capital   stock  of  98,000   Class   B
common shares	
South Peace Dehy-Products Ltd.—27.7 per cent interest, 277 nonvoting common and 277 voting preferred shares at cost	
Swan Valley Foods Ltd.—40 per cent interest, 219,804
common and 28,266 preferred shares at cost	
Westcoast Transmission Company Limited—10.6 per
cent interest, 1,157,125 common shares at cost.	
151,532,930
85,000
2,000
98,000
554
1977
$
85,000
2,000
98,000
554
425,501
25,456,750
Net increase
or (decrease)
during 1977/78
$
151,532,930
(425,501)
(25,456,750)
151,718,489 26,067,805       125,650,684
Fixed Assets
Gross...
   2,198,517,376    2,317,998,792
Less depreciation       120,587,139       195,134,876
(119,481,416)
(74,547,737)
2,077,930,237    2,122,863,916       (44,933,679)
Gross
Detail as of March 31, $
1978—
2Highways  1,759,596,435
Bridges..   383,860,047
Wharves  203,250
Ferries    and    ferry-
landings _. 33,897,240
3Buildings   and   furnishings...  20,186,714
Songhees   Reserve,
Victoria  773,690
Depreciation
$
108,825,047
203,240
7,110,566
4,448,286
Net
$
1,759,596,435
275,035,000
10
26,786,674
15,738,428
773,690
2,198,517,376   120,587,139 2,077,930,237
1 Pursuant to the British Columbia Resources Investment Corporation Act (Order in Council 530/78) the following assets
and rights were transferred to the British Columbia Resources Investment Corporation in exchange for a promissory note
based on the valuations shown:
Canadian Cellulose Company Limited—
9,848,453 common shares without par value; 39,750 nonvoting shares without par value     $64,273,320
Plateau Mills Ltd.—9,000 common shares, par value of $10 _ _ _        9,000,000
Kootenay Forest Products Ltd.—11,993,399 common shares, par value of $1     _._  1
Westcoast Transmission Company Limited—1,157,125 common shares without par value       37,363,566
Province of British Columbia—Assigned petroleum or natural gas rights _         40,896,043
Valuation of promissory note
$151,532,930
The book values of these assets and rights were as follows:
(a) Shares received as a dividend from British Columbia Cellulose Company in repayment of advances   $19,849,421
Canadian Cellulose Company Limited—9,570,353 common shares; 39,750 nonvoting shares
Plateau Mills Ltd.—225 common shares
Kootenay Forest Products Ltd.—11,993,339 common shares
(M Canadian Cellulose Company Limited—278,100 common shares held as temporary investment 	
(c) Plateau Mills Ltd.—8,775 common shares held as investment in Crown corporation 	
(d) Westcoast Transmission Company Limited—1,157,125 common shares held as investment, other       25,456,750
(e) Petroleum and natural gas rights  _ _ _          Nil
2 Placed on the books March 31, 1926, by order of the Treasury Board, based on mileage classification and average value
determined by the then Department of Public Works, plus additions to date.
3 As of March 30, 1978, assets in the amount of $381,571,109 (at cost) less accumulated depreciation of $84,359,819 were
transferred to the British Columbia Buildings Corporation pursuant to the British Columbia Buildings Corporation Act.
1,824,942
7,663,256
 B 6                                                 PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GENERAL   FUND   LIABILITIES Net increase
or (decrease)
1978 1977 during 1977/78
$ $ $
Outstanding Cheques        92,417,903 82,703,277 9,714,626
Accounts Payable (paid in April of next following year)    147,030,787 152,248,168 (5,217,381)
Other Current Liabilities
Accrued interest payable on public debt   4,253,159 4,536,490 (283,331)
Education tuition fees   8,000,000 8,000,000 —
Guarantee and performance deposits—contractors, licensees, etc    2,145,028 2,006,603 138,425
Holdbacks on construction contracts    10,022,267 5,860,040 4,162,227
Hospital  construction  funds  held pending  claims  by
hospitals       179,911 221,768 (41,857)
Municipal vehicle licence account     584,040 590,452 (6,412)
Petroleum  production  credits  redeemable  upon  performance of exploration and development work..  7,178,997 10,454,539 (3,275,542)
Suspense—
Permit and licence applications  8,697,588 3,023,944 5,673,644
Taxes, fees, etc        1,578,938 1,566,536 12,402
Miscellaneous ministerial accounts    3,301,633 4,005,035 (703,402)
45,941,561 40,265,407 5,676,154
Unmatured Debt (for details as to terms of issue, etc., see
pageB 18)
tDeficit repayment
Debentures—
Series AA: Due Dec. 22, 1977, 9<A per cent...  — 50,000,000 (50,000,000)
Series AB: Due Sept. 1, 1978, 9Va per cent  — 50,000,000 (50,000,000)
Set:»s AC: Due Nov. 1, 1978, 9V4 percent  50,000,000 50,000,000 —
Series AD: Due Feb. 18, 1979, 8 per cent......  100,000,000 100,000,000 —
Series AE: Due Mar. 15, 1979, 8 per cent  11,447,790 11,447,790 —
Subtotal, deficit repayment debentures  161,447,790 261,447,790 (100,000,000)
Treasury Bills—
Series DS: Due Mar. 31, 1979, 8 per cent  50,000,000 — 50,000,000
Series DT: Due Mar. 31, 1979, 8 percent  50,000,000 — 50,000,000
Subtotal, deficit repayment Treasury Bills...... 100,000,000 — 100,000,000
Total deficit repayment   261,447,790 261,447,790 —
Other-
Treasury Bills, payable to Government of Canada in annual instalments through 1977—
Interest free  — 278,073 (278,073)
Interest at 2Ya per cent.....    — 144,077 (144,077)
Subtotal, other    — 422,150 (422,150)
261,447,790 261,869,940 (422,150)
l Borrowing made pursuant to British Columbia Deficit Repayment Act, 1975-1976 (1976, chap. 6). On May 1, 1978, the
above debentures were substituted for 9.125% bonds in the same amount repayable in 10 annual instalments commencing May
1, 1979.   (See Note 5, B-18.)
 PUBLIC ACCOUNTS 1977/78 B 7
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GENERAL FUND LIABILITIES—Continued Net increase
or (decrease)
1978 1977 during 1977/78
linking Funds (deducted from unmatured debt) $ $ $
Book value of funds; being less than par value of assets — 422,150 (422,150)
Assets at par value—
Cash in banks      — 373
Short-term deposits with chartered banks and trust
companies     — 1,087,560
Securities—
Province of Manitoba  — 422,150
— 1,510,083
Less excess of par value over book value (including a provision for future interest
requirements)...    — 1,087,933
Total sinking fund assets at book value, as
above   — 422,150
Summary of Sinking Fund Transactions During Year
Payments and charges—
Redemption of debt   422,150
Transfer to Consolidated Revenue Fund—
Extraordinary income on wind up of fund         1,083,018
1,505,168
Receipts and credits—
Proceeds on disposal of investments          1,083,018
Net reduction in sinking funds during year,
as above   422,150
l These sinking funds have been provided for the full repayment of long-term debt (principal and interest) exclusive of
borrowings pursuant to the British Columbia Deficit Repayment Act, 1975-1976 (1976, chap. 6).
 PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GENERAL FUND EXCESS OF ASSETS OVER LIABILITIES
Revenue Surplus
Balance at March 31, 1977	
Net revenue for the year (page A 9)  	
        76,129,730
          140,488,978
Balance at March 31, 1978           216,618,708
Deficit at March 31, 1976, funded pursuant to the British Columbia Deficit Repayment Act,
1975-1976..
(261,447,790)
Capital Surplus
Balance at March 31, 1977       2,524,103,353
Expenditure on fixed assets, less depreciation (page B 5)-
Highways  	
Bridges-
Gross Expenditure
$
...  234,027,257
..    22,312,325
Ferries and ferry-landings           3,516,452
Buildings and furnishings           2,233,659
Less transfer to British Columbia Buildings Corporation (page B 5)	
Depreciation
$
8,694,905
728,827
388,350
9,812,082
84,359,819
(119,481,416)  (74,547,737)
262,089,693
381,571,109
(44,933,679)
Net increase in taxes and accounts receivable (page B 3 )        20,677,857
Net increase in loans and advances (page B 4)    4,337,157
Transactions pertaining to investments in and advances to Crown Corporations
and other long-term investments
British Columbia Buildings Corporation—
Promissory note received for depreciable assets transferred    143,570,934
Instalment payment received      (10,000,000)
British Columbia Cellulose Company-
Dividends received in various securities      19,849,421
Less applied to advances outstanding        14,355,123
133,570,934
Balance representing interest earned on advances    5,494,298
British Columbia Harbours Board—Advances repaid  —         (2,000,000)
British Columbia Resources Investment Corporation—
Shares at nominal value        5
Promissory note received for assets and rights transferred        151,532,930
Book values of assets transferred     54,794,369
Less those that were held as temporary investments (see nonbudgetary expenditure)        1,824,942
(See footnote (J) on page B 5 for particulars of transfer)
Crown Development Corporation—write-off shares, corporation wound up.
Ocean Falls Corporation—additional advances  .__
Swan Valley Foods Ltd.—
Additional shares acquired:
For cash    	
For other considerations    	
(52,969,427)
(1,000)
2,000,000
Book value of the entire Swan Valley Foods Ltd. shareholding sold to
Standard Brands Ltd. for $2,200,000 represented by promissory note
of $2,000,000 and cash held in trust subject to claims settlement.
(Included in loans and advances—Farm Products Industry Improvement Act, page B-3)   	
T. S. Holdings Ltd.—advances    	
7,631,250
251,000
7,882,250
(8,307,751)
(425,501)
13,767
Balance at March 31, 1978      2,741,400,694
Combined balance of surplus at March 31, 1978—     2,696,571,612
 PUBLIC ACCOUNTS 1977/78
B 9
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
Cash (in banks).
SPECIAL PURPOSE FUNDS—ASSETS
1978
$
   20,209
Investments (at cost)..       237,612,176
Securities Held at Par Value
Short-term deposits with chartered banks, trust companies, etc.—
Banque Canadienne Nationale	
Bank of British Columbia  	
Bank of Montreal 	
Bank of Nova Scotia    	
British Columbia Central Credit Union-
Canadian Imperial Bank of Commerce
Mercantile Bank  	
Provincial Bank of Canada 	
Royal Bank of Canada 	
Toronto Dominion Bank	
Other—
tBritish Columbia Hydro and Power Authority
parity bonds      	
!British Columbia Railway Company parity bonds ...
iBritish Columbia Regional Hospital Districts Financing Authority bonds	
British Columbia School Districts Capital Financing Authority bonds	
2Export Development Corporation notes	
Less excess of par value over cost
i Province of British Columbia guarantee.
2 Government of Canada guarantee.
1977
$
305,193
157,569,246
—
2,000,000
365,000
4,000,000
9,754,000
3,124,875
7,643,679
8,390,000
272,500
—
30,775,746
—
—
2,421,900
173,000
5,000,000
43,278,583
12,817,444
20,072,000
11,000,000
112,334,508
48,754,219
17,511,800
16,009,200
10,235,000
10,235,000
22,000,000
22,000,000
60,592,000
60,592,000
15,000,000
—
237,673,308
157,590,419
61,132
21,173
237,612,176
157,569,246
Net increase
or (decrease)
during 1977/78
$
(284,984)
80,042,930
 B 10 PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
SPECIAL  PURPOSE  FUNDS—ASSETS—Continued Net increase
or (decrease)
1978 1977 during 1977/78
Other Assets $ $ $
Note—These assets are carried at book value as the amount of
ultimate realization cannot be determined at this date.
Housing Fund (pursuant to the Ministry of Municipal
Affairs and Housing Act) —
Accounts and advances receivable          18,411,597 4,674,334 13,737,263
Mortgages receivable—secured.            4,891,401 3,484,632 1,406,769
Real estate   87,852,500 63,440,514 24,411,986
Investments in, and advances to
Housing Corporation of British Columbia—
Entire issued share capital of 1,355,084
common shares at cost   5,799,760 5,799,760 —
Advances  3,889,535 39,441,231        (35,551,696)
Provincial Rental Housing Corporation—
Entire issued share capital of three common shares at cost  633,511 633,511 —
Advances        34,473,986 37,439,221 (2,965,235)
British Columbia Housing Management Commission Advances     1,096,952 6,099,732 (5,002,780)
157,049,242       161,012,935 (3,963,693)
Lottery Fund—working capital—
Advance to the Western Canada Lottery Foundation    100,000 100,000 —
tProvincial Home Acquisition Fund—mortgage loans
pursuant to the Provincial Home Acquisition Act
and the Leasehold and Conversion Mortgage Loan
Act           242,047,536      253,812,485       (11,764,949)
399,196,778       414,925,420       (15,728,642)
l Summary of loan transactions during year (Provincial Home Acquisition Fund)-
Loans issued    	
Deposits refunded (net)
Less-
Repayment of principal
Statutory remissions
Loans written off (uncollectable)	
34,014,348
13,116
34,027,464
44,836,893
319,820
635,700
45,792,413
Net decrease in book value of loans during year, as above _  11,764,949
 PUBLIC ACCOUNTS 1977/78
B 11
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 B  12
PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
SUPERANNUATION FUNDS—ASSETS
1978
Cash (in banks) $
Public Service Superannuation Fund    7,520
Members of the Legislative Assembly Superannuation
Account....      3,101
10,621
1977
$
18,920
1,910
20,830
Net increase
or (decrease)
during 1977/78
$
(11,400)
1,191
(10,209)
Investments (at book value)
Public Service Superannuation Fund  	
Members of the Legislative Assembly Superannuation
Account 	
Securities Held
Public Service Superannuation Fund—
Debt securities (par value)—
Short-term deposits with chartered banks..
Province of British Columbia	
Province of Ontario	
Province of Quebec	
Province of Saskatchewan 	
Government of Canada 	
Canadian National Railway..
572,269,078
1,598,546
Manitoba Hydro-electric Commission (Province of Manitoba guarantee)	
Manitoba Telephone Systems (Province of
Manitoba guarantee) 	
Montreal Auto Route (Province of Quebec
guarantee)	
New Brunswick Electric Power Commission
(Province of New Brunswick guarantee)
Newfoundland and Labrador Hydro-electric
Corporation (Province of Newfoundland
guarantee)	
Nova Scotia Power Corporation (Province of
Nova Scotia guarantee)	
Ontario Hydro-electric Power Commission
(Province of Ontario guarantee)	
Quebec Hydro-electric Commission (Province
of Quebec guarantee).
British Columbia Hydro and Power Authority..
iBritish Columbia Ferry Authority..
iBritish Columbia Railway Company 	
British Columbia Regional Hospital Districts
Financing Authority 	
iBritish Columbia School Districts Capital Financing Authority   	
iBritish Columbia Steamship Company (1975)
Ltd 	
1British Columbia municipalities	
xBritish Columbia improvement districts..
1British Columbia school districts	
Less excess of par value over book value..
572,371,601
11,814,135
477,993,446
1,309,996
573,867,624  479,303,442
11,170,000
127,463,090
1,242,000
727,000
3,451,000
15,454,000
6,000
35,488,545
111,558,790
939,000
25,000
1,600,000
250,000
6,000
312,000
16,000
70,000
70,000
250,000
250,000
1,595,000
—
700,000
—
2,325,000
1,000,000
30,197,000
4,201,000
5,257,000
275,232,545
44,353,000
2,869,000
200,134,000
15,273,000
45,823,000
10,000,000
10,000,000
18,378,000
18,056,800
3,400,000
5,928,666
12,234,600
2,625,700
2,800,000
6,875,412
11,912,400
4,104,000
473,251,947
6,970,113
560,557,466  466,281,834
94,275,632
288,550
94,564,182
i Province of British Columbia guarantee.
 PUBLIC ACCOUNTS 1977/78
B 13
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
SUPERANNUATION  FUNDS—ASSETS—Continued
Investments (at book value)—Continued
Securities Held—Continued
Public Service Superannuation Fund—Continued
Stocks (book value)—
Bank of British Columbia, 51,055 shares	
British   Columbia   Telephone   Company,
1,001,955 common shares	
Canadian   Pacific   Limited,   1,200   common
shares	
Imperial Oil Limited, 300 common shares	
International   Nickel   Company   of   Canada
Ltd., 450 common shares	
1978
$
14,344
Members of the Legislative Assembly Superannuation
Account (par value)—
Short-term deposits with chartered banks	
1British Columbia Hydro and Power Authority	
JBritish Columbia Railway Company  	
iBritish Columbia School Districts Capital Financing Authority  	
iBritish Columbia improvement districts	
iBritish Columbia municipalities	
iBritish Columbia school districts 	
Government of Canada  	
2Ontario Hydro-electric Power Commission	
Less excess of par value over book value-
Total securities at book value, above.—
1,624,000
25,454
1,598,546
1977
$
1,147,589
1,147,589
10,517,167
10,517,167
19,800
12,712
19,800
12,712
14,344
Total securities at book value, above     572,269,078       477,993,446
373,600
53,600
1,047,000
1,118,000
20,000
20,000
90,000
90,000
14,000
16,000
—
2,000
24,400
32,000
15,000
—
40,000
—
1,331,600
21,604
1,309,996
l Province of British Columbia guarantee,
s Province of Ontario guarantee.
 B  14 PROVINCE OF BRITISH COLUMBIA
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
SUPERANNUATION FUNDS—SUMMARY OF TRANSACTIONS FOR THE YEARS ENDED
MARCH 31,  1978 AND 1977
PUBLIC SERVICE SUPERANNUATION FUND
March 31, 1978 March 31, 1977
Receipts and Credits                                                                                                              $ $
Contributions—
Employees......         38,749,640 32,243,433
Province of British Columbia      44,467,071 38,005,601
Other employers         7,503,560 4,208,069
Transfers from other plans and funds (net)  _.        1,428,096 841,867
^Transfers from Member's Account (below)             — 649,713
Interest on investments         33,993,531 34,178,961
126,141,898       110,127,644
Disbursements and Charges
Superannuation allowances        22,463,649 18,696,384
Refunds—
Employees            5,110,493 4,534,397
Province of British Columbia        4,303,524 3,872,153
31,877,666        27,102,934
Net increase in funds during year...       94,264,232 83,024,710
Balance at credit of funds at beginning of year   478,012,366       394,987,656
Balance at credit of funds at end of year   572,276,598      478,012,366
MEMBERS OF THE LEGISLATIVE ASSEMBLY SUPERANNUATION ACCOUNT
Receipts and Credits
Contributions—
Members   85,703 73,051
Province of British Columbia     131,017 343,637
Interest on investments    76,442 109,770
293,162 526,458
Disbursements and Charges
transfer to Public Service Fund (above).....     — 649,713
Refunds—Members.......   3,421 12,753
3,421 662,466
Net increase (decrease) in funds during year    —.        289,741 (136,008)
Balance at credit of funds at beginning of year        1,311,906 1,447,914
Balance at credit of funds at end of year—        1,601,647 1,311,906
i Superannuation allowances to former Members of the Legislative Assembly are paid from the Public Service Superannuation Fund for purposes of administration. The capitalized values of the allowances are provided by transfer from the Members
of the Legislative Assembly Account.
 PUBLIC ACCOUNTS 1977/78 B 15
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
TRUST   FUNDS ASSETS Net increase
or (decrease)
1978 1977 during 1977/78
Cash and Investments $ $ $
Cash in banks.     1,116,786 2,221,066 (1,104,280)
Short-term  deposits  with  chartered  banks  and  trust
companies   195,801,024 79,757,971 116,043,053
Investments—direct  or   guaranteed   securities   of   the
Government of Canada and the Provinces  542,533,975 540,072,268 2,461,707
739,451,785       622,051,305       117,400,480
TRUST FUNDS—BALANCES
Trust Deposits
Bond redemption account (unclaimed bonds)    7,500
Bond interest coupon account (unclaimed bond coupons)  	
Cemetery Tax Account	
Companies in liquidation  	
Courts  	
Intestate estates  	
Official Committee	
Official Guardian  	
Patients' accounts, Provincial institutions..
Miscellaneous  	
Sinking Funds
British Columbia Buildings Corporation	
British Columbia Hydro and Power Authority..
British Columbia Ferry Authority 	
British Columbia Railway Company..
British Columbia Regional Hospital Districts Financing
Authority  	
British Columbia School Districts Capital Financing
Authority	
Burnaby, District of  	
Greater Vancouver Sewerage and Drainage District	
Queensborough Bridge Account. 	
Sundry improvement districts  	
109,010,065
314,852
288,858,958
31,268,867
84,557,874
154,212,609
709,379
18,112,156
1,524,243
5,164,789
Other
Ferries Insurance Fund	
Land Registry Assurance Fund_..
Workers' Compensation Board,
account	
Accident Fund bank
British Columbia Buildings Corporation
Travel Agents Assurance Fund	
4,381,113
806,522
405,602
203,300
15,500
244,095,289
50,490,303
70,870,204
121,494,030
632,332
17,319,689
1,752,120
4,387,919
624,645,183       540,228,979
4,045,164
757,153
1,027,233
17,750,584
(8,000)
3,284
4,589
(1,305)
85,312
84,872
440
382,632
424,941
(42,309)
65,944,112
19,687,523
46,256,589
13,784,862
12,245,058
1,539,804
22,627,835
20,953,480
1,674,355
5,650,246
4,215,745
1,434,501
346,377
435,717
(89,340)
177,905
174,767
3,138
58,242,192 50,767,873
314,852
44,763,669
(19,221,436)
13,687,670
39,921,456        29,187,093 10,734,363
32,718,579
77,047
792,467
(227,877)
776,870
84,416,204
335,949
49,369
(621,631)
(17,750,584)
203,300
5,796,537        23,580,134       (17,783,597)
Total miscellaneous trust deposits     739,451,785       622,051,305       117,400,480
 B  16
PROVINCE OF BRITISH COLUMBIA
Less
Gross
Sinking
Net
Outstanding*
Funds 2
Outstanding
$
$
$
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GUARANTEED  DEBT
Debt Guaranteed as to Principal and Interest by $
the Province
Municipalities   and   other   local   governments—
(1) Guarantees authorized pursuant
to the Public Schools Construction Act (principally funded)..   .  867,412,200
Less held by British Columbia
School Districts Capital Financing Authority  851,714,000
(2)  Guarantees authorized pursuant
to   sec.   46,   Regional  Hospital
Districts Act  331,464,000
Less held by British Columbia
Regional Hospital Districts
Financing Authority  331,464,000
15,698,2003 —
(3) Guarantees authorized pursuant to sec. 3,
Municipalities Assistance Act (principally
serials)  	
(4) Guarantees authorized pursuant to sec. 3,
Village Municipalities Assistance Act (repayable serially)..   	
(5) Guarantees authorized pursuant to sec. 12,
Improvement Districts Assistance Loan Act,
debentures (principally serials)	
(6) Greater Vancouver Sewerage and Drainage
District debentures (some serials)	
Subtotals,  municipalities and local governments 	
15,698,200
36,994,645
763,973
36,230,672
33,500
—
33,500
27,429,400
5,804,369
21,625,031
20,085,000
17,006,622
3,078,378
100,240,745
23,574,964
76,665,781
 Less
Sinking
Funds2
Net
Outstanding
$
$
PUBLIC ACCOUNTS 1977/78 B 17
SCHEDULES TO STATEMENT OF ASSETS AND LIABILITIES—Continued
GUARANTEED  DEBT—Continued
Gross
Outstanding!
Crown agencies— $
(7) Guarantees authorized pursuant to sec. 46,
British Columbia Hydro and Power Authority
Act, 1964—
Bonds and debentures—funded       4,683,319,200
Parity bonds—unfunded         75,000,000
(8) Guarantees authorized pursuant to sec. 17,
British Columbia Railway Company Construction Loan Act—
Bonds and debentures—funded        736,585,000
Notes—unfunded   6,200,000
(9) Guarantees authorized pursuant to sec. 28,
British Columbia Ferry Authority Act, bonds
and debentures—funded   18,685,000
(10) Guarantees authorized pursuant to sec. 9,
British Columbia School Districts Capital Financing Authority Act, debentures—principally funded...         851,714,000
(11) Guarantees authorized pursuant to sec. 9,
British Columbia Regional Hospital Districts
Financing Authority Act, debentures—funded        331,464,000
(12) Guarantees authorized pursuant to sec. 8,
British Columbia Cellulose Company Act,
1973 (U.S. funds)  37,000,000
(13) Guarantees authorized pursuant to sec. 4a,
Ministry of the Environment Act   3,400,000
(14) Guarantees authorized pursuant to sec. 12,
British Columbia Buildings Corporation Act,
1976, debentures—funded         33,000,000
(15) Guarantees authorized pursuant to sec. 14,
Development Corporation of British Columbia
Act, 1973—notes..     22,600,000
Subtotal, Crown agencies     6,798,967,200
294,335,480   4,388,983,720
— 75,000,000
90,024,289       646,560,711
— 6,200,000
18,685,000 —
157,896,764 693,817,236
40,639,189 290,824,811
— 37,000,000
— 3,400,000
321,078 32,678,922
— 22,600,000
601,901,800    6,197,065,400
Resource enterprises—
(16) Guarantees   authorized   pursuant   to   sec.   3,
Farm   Products  Industry   Improvement   Act,
1973, 2nd Sess  10,584,309
(17) Guarantees   authorized   pursuant   to   sec.   3,
Agricultural Credit Act, 1973, 2nd Sess  3,525,462
(18) Guarantees authorized pursuant to sec. 4 (3),
Ministry of Economic Development Act.   339,200
Subtotal, resource enterprises  14,448,971
Grand total all guaranteed debt..     6,913,656,916
10,584,309
3,525,462
339,200
14,448,971
625,476,764   6,288,180,152
l Except in the case of the British Columbia Hydro and Power Authority where debt payable in United States dollars is
translated to Canadian dollars at the rates of exchange prevailing at the date the debt was incurred, debt payable in United
States dollars is recorded at par. Translation of the debt payable in United States dollars at the rate of exchange as at March
31, 1978, would increase the total gross debt outstanding by approximately $198 million. In addition, interest accrued at
March 31, 1978, on the gross debt would further increase the total gross debt by approximately $169 million.
' Sinking funds comprise cash and investments recorded at par value plus accrued interest except for Item (7) recorded at
book value plus cash and accrued interest and Item (9) shown at an adjusted value equivalent to the debt outstanding (book
value plus accrued interest equals 531,514,681). Translation of securities payable in United States funds, including accrued
interest, at the rate of exchange as at March 31, 1978, would increase the total value of sinking funds by approximately $11
million.
S Repayable serially.
 B  18
PROVINCE OF BRITISH COLUMBIA
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o;5
 PUBLIC ACCOUNTS 1977/78
SECTION C
SCHEDULES OF GENERAL FUND REVENUE AND EXPENDITURE
CONTENTS
Page
Revenue for the fiscal year ended March 31, 1978—Details by source  C    2
Expenditure for the fiscal year ended March 31, 1978—
Budgetary expenditures and appropriations by ministries—
Legislation	
Auditor General  C
Ministry of Finance  C
Executive Council  C
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o
Ministry o:
the Provincial Secretary and Travel Industry  C
the Attorney-General  C
Economic Development  C
the Environment  C
Agriculture  C
Energy, Transport and Communications  C
Mines and Petroleum Resources  C
Forests  C
Highways and Public Works  C
Education  C
Health    C
4
4
4
4
4
6
6
7
•7
7
8
8
8
9
9
Human Resources  C 10
Municipal Affairs and Housing  C 10
Labour  C 11
Consumer and Corporate Affairs  C 11
Recreation and Conservation  C 11
Nonbudgetary expenditure.
C 12
 C 2
PROVINCE OF BRITISH COLUMBIA
DETAILS OF REVENUE FOR THE FISCAL YEAR ENDED MARCH 31,  1978
SOURCE
$
PROPERTY TAXES
20,400,000    Real property tax _._ _ _  21,562,622
Estimated
$
Received
7,000,000
740,000,000
171,000,000
19,000,000
3,000,000
32,000,000
8,500,000
980,500,000
SOCIAL SERVICES, FUEL TAXES, ETC.
Pari mutuel betting tax — 	
Social services tax (net).- _	
Gasoline tax    	
Motive-fuel use tax.
Fuel-oil tax 	
Cigarette and tobacco tax ~
Hotel and motel room tax.
Total, social services, fuel taxes, etc.
8,002,981
748,383,192
167,031,542
19,792,152
2,458,145
33,255,747
8,251,499
987,175,258
CORPORATION, PERSONAL, SUCCESSION, AND
GIFT TAXES
Corporation:
283,000,000       Income tax _ -   _	
33,000,000       Capital tax    	
1,115,500,000   Personal income tax   	
12,000,000   Succession and gift taxes - - _  	
1,443,500,000
Total,  corporation,  personal,
gift taxes   	
succession,   and
245,699,084
41,452,916
985,990,685
14,050,675
1,287,193,360
PRIVILEGES, LICENCES, AND NATURAL RESOURCES
TAXES AND ROYALTIES
48,600,000    Motor-vehicle Licences and Permits	
Natural Resources
6,100,000    Wildlife Act—Fees and licences _ _	
Lands and Forests—
500,000       Grazing permits and fees— _    460,041
5,000,000       Land leases, rentals and fees  _  7,050,778
10,000,000        Logging tax       48,461,112
150,000       Timber leases - - - -    143,532
500,000       Timber licences      505,639
7,000,000       Timber royalties    - 8,668,094
50,000,000       Timber sales    _   -  79,234,093
Minerals—
5,300,000       Coal, minerals, and metals royalties  —  4,516,651
245,600,000       Petroleum and natural gas royalties, leases, and fees.._ 426,691,591
200,000       Free miners' certificates    216,478
2,500,000       Mining receipts, general     2,004,955
11,000,000       Mining tax  —  9,150,820
9,040,000       Mineral land tax    8,087,921
11,000,000       Mineral resource tax  _   - - 11,396,392
Water Resources—
13,300,000       Water rentals and recording fees.	
57,791,570
5,541,912
144,523,289
462,064,808
14,588,575
600,000
175,000
3,300,000
2,200,000
990,000
175,000
210,000
10,000,000
1,800,000
1,000,000
240,000
4,910,000
451,390,000
Other
Agricultural licences and fees.
Boiler inspection fees	
Companies Branch-
Electrical energy inspection fees	
Fire Marshal Act—fees, etc .	
Gas Act—fees	
Insurance Act 	
Insurance premiums tax.
Law stamps	
Probate fees 	
Securities Act.	
Sundry licences and permits _
648,577
292,854
3,787,118
1,941,632
1,645,580
188,171
460,966
12,356,562
2,098,662
1,321,694
178,715
3,518,929
Total privileges, licences, and natural resources
taxes and royalties.. _	
28,439,460
712,949,614
 PUBLIC ACCOUNTS 1977/78
C 3
DETAILS OF REVENUE FOR THE FISCAL YEAR ENDED MARCH 31,  1978—Continued
Estimated
$
1,250,000
350,000
SOURCE
SALES AND SERVICE FEES
Sales
Land sales 	
Sale of maps and air photos...
',303,889
354,528
Services
Administration Act-
•fees-
4,000,000
693,000
5,900,000
2,500,000
2,567,000
6,750,000
840,000
18,000,000
5,068,000
1,500,000
1,000,000
550,000
4,832,000
55,800,000
Motor-vehicle lien and search fees...
Education course and examination fees  _	
Medicare Services recoveries _ _     6
Ferry revenue	
Ambulance Service	
Forest scaling fees _
Land-clearing receipts..
Land Registry fees.
Reservoir waterway improvements.
Sheriffs' fees  _
Publications Service Branch (Education) rentals and sales —
Vital Statistics  __ _ _ _	
Sundry services   _	
303,459
,883,321
580,739
,020,036
,562,969
,246,843
,374,248
,468,974
,269,289
,277,549
,312,285
868,281
456,154
,027,700
Received
2,658,417
54,651,847
Total, sales and service fees..
57,310,264
FINES AND PENALTIES
8,500,000   Court fees and fines	
INTEREST, DISCOUNT,  PREMIUM, AND EXCHANGE
12,000,000   Miscellaneous interest and dividend income.._ _	
10,377,029
34,896,363
CONTRIBUTIONS FROM OTHER GOVERNMENTS
2,300,000 Canada statutory subsidies  _	
2,000,000 Canada percentage of power corporation tax	
310,300,000 Canada established programs financing  -	
282,403,000 Canada share of joint service programs in lieu of opting out _
597,003,000
30,785,000   Municipal share of joint service programs.
22,000   Other provinces _ _   _
627,810,000
Total, contributions from other governments.
2,116,848
477,620
373,854,000
298,211,283
674,659,751
32,685,829
73,0%
707,418,676
CONTRIBUTIONS FROM GOVERNMENT ENTERPRISES
170,000,000    Net profit, Liquor Distribution Branch (including permits) _.
33,000,000    British Columbia Buildings Corporation — -	
203,000,000
Total,   contributions  from   Government  enterprises    _	
180,677,062
15,000,000
195,677,062
MISCELLANEOUS
7,045,000    Institutional maintenance receipts _.	
19,955,000   Miscellaneous revenue  	
27,000,000
3,829,900,000
Total, miscellaneous ...
Total, budgetary revenue
15,082,041
25,849,544
40,931,585
4,055,491,833
NONBUDGETARY
Government of Canada contribution to assist in the construction of Dease Lake rail line   - 	
Interest earned on above _ __ _ _	
Recovery of advance to B.C. Harbours Board -	
Proceeds on wind up of Consolidated Sinking Fund 	
Total, nonbudgetary revenue	
Total revenue _	
79,852,785
1,315,295
81,168,080
2,000,000
1,083,018
84,251,098
4,139,742,931
 C 4
PROVINCE OF BRITISH COLUMBIA
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH 31,  1978
SUMMARY SHOWING EXPENDITURE COMPARED WITH MAIN ESTIMATES AND OTHER AUTHORIZATIONS
No.
of
vote
SERVICE
Legislation
1    Legislation  _ _ _	
Statutory—
Constitution Act (R.S.B.C. 1960, chap.
71, sec. 71)  	
Crown    Corporation    Reporting    Act
(1977, chap. 49, sec. 10)..— 	
Auditor General
Statutory—Auditor   General  Act   (1976,
chap. 3, sec. 20) 	
Total
expenditure
5,131,913
148,456
5,280,369
344,966
Main
estimates
voted
$
3,580,426
3,580,426
Expenditure
over (under)
main
estimates
$
1,551,487
148,456
1,699,943
344,966
Other
authorizations1
1,551,487
148,456
1,699,943
344,966
Net
over (under)
expenditure
Ministry of Finance
Minister's office  	
Supplement—Special Warrant No. 72..
Administrative and support services	
Supplement—Special Warrant No. 72 .
Controlling and audit branch..
Computer and consulting services 	
Supplement—Special Warrant No. 72	
Statutory—Revenue Act, (R.S.B.C.  1960,
chap. 341, sec. 55 (3))  	
Purchasing Commission _   _
Supplement—Special Warrant No. 72	
Taxation administration  _	
8 Assessment Appeal Board   	
Supplement—Special Warrant No. 59..
9 Government agencies   	
10   Interest on public debt..
Supplement—Special Warrant No. 72	
11 Grants, contributions and subsidies—	
Supplement—Special Warrant No. 14	
12 Interest on funds and deposits —	
13 Incidentals    .' 	
Supplement—
Special Warrant No. 29	
Special Warrant No. 72
14 Salary contingencies (all ministries)	
Supplement—Special Warrant No. 72 .
15 Treasury Board-
Supplement—Special Warrant No. 15	
16 Building occupancy charges	
17 Computer and consulting charges	
Statutory—
Court of Revision costs. Assessment
Amendment Act (1977, chap. 30,
sec. 165 )   	
Judgments against Crown, Crown Proceedings Act (1974, chap. 24, sec.
13 (4))  _ _ _  	
Staff reduction salary savings	
Executive Council
18 Executive Council.   	
Ministry of the Provincial Secretary
and Travel Industry
Provincial Secretary and
Travel Industry
19 Minister's office — -	
20 General administration _  	
21 Central Microfilm Bureau  -	
22 Postal Branch 1 	
Supplement—Special Warrant No. 67.
23 Legislative Library 	
24 Provincial Archives  	
Supplement—Special Warrant No. 21	
25    Queen's Printer 	
Statutory—Public Printing Act (R.S.B.C.
1960, chap. 318, sec. 12)...- - _
105,026
95,034
9,992
10,000
(8)
947,853
903,968
43,885
70,000
(26,113)
2,599,261
2,830,063
(230,802)
(230,802)
5,856,154
3,500,010
2,356,^44
300,000
2,056,144
1,311,898
1,315,344
(3,446)
110,000
(113,446)
3,982,898
4,322,478
(339,580)
(339,580)
168,175
100,000
68,175
72,500
(4,325)
(328,149)
4,589,145
4,917,294
(328,149)
22,507,492
13,875,000
8,632,492
8,691,508
(39,016)
31,590,883
30,260,000
1,330,883
3,100,000
(1,769,117)
3,430,358
3,500,000
(69,642)
(69,642)
1,941,053
788,510
1,152,543
742,500
440,000
(29,957)
41,358,721
41,362,498
(3,777)
2,750,000
(2,753,777)
10,251,329
10,765,913
(514,584)
265,000
(779,584)
1,616,695
1,666,187
(49,492)
(49,492)
1,595,502
1,595,502
—
—
421,839
23,436
134,297,718
134,297,718
691,125
144,787
354,802
737,173
5,030,070
615,642
770,534
121,797,801
1,987,033
119,810,768
713,648
155,690
339,252
806,242
4,529,088
646,994
742,620
30,312
421,839
23,436
12,499,917
1,987,033
14,486,950
(22,523)
(10,903)
15,550
(69,069)
500,982
(31,352)
27,914
30,302
421,839
23,436
19,052,927
19,052,927
600,000
39,300
30,302
(6,553,010)
1,987,033
(4,565,977)
(22,523)
(10,903)
15,550
(69,069)
(99,018)
(31,352)
(11,386)
 PUBLIC ACCOUNTS 1977/78
C 5
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH  31,   1978—Continued
No.
of SERVICE
voto
Ministry of the Provincial Secretary
and Travel Industry—Continued
Provincial Secretary and Travel
Industry—Continued
26 Government House  	
Supplement—Special Warrant No. 22	
27 Agent  General's  Office  and  British  Co
lumbia House, London, England 	
Supplement—Special Warrant No. 23	
28 Indian Advisory Act  -	
29 Public Inquiries Act   	
Statutory—Public Inquiries Act (R.S.B.C.
1960, chap. 315, sec. 13) .._ -	
30 Grants—Special services and events	
31 Provincial Elections Act...- —	
32 Provincial Emergency Programme	
33 Air Services 	
Statutory—Revenue Act, (R.S.B.C. 1960,
chap. 341, sec. 55 (3))     - -
34 British Columbia Lottery Branch 	
35 Unemployment Insurance  and  Workers'
Compensation  	
36 Provincial   Museum   and   Resource   Mu
seums — — — ~	
Supplement—Special Warrant No. 24	
37 Government publications 	
38 Public information  _	
39 Legislative tour guides  -	
40 Queen Elizabeth II British Columbia
Centennial Scholarship Act 	
41 Flood Relief Act  _	
42 General administration—travel industry ....
43 Travel division ...  	
Supplement—Special Warrant No. 56	
44 Beautiful British Columbia Magazine	
45 California and London offices  -
46 Film and photographic branch —	
47 Building occupancy charges —	
48 Computer and consulting charges	
Statutory—
Advances to committee, Captain Cook
Bi-centennial Commemoration Act
(1977, chap. 23, sec. 9)  	
Medical expenses, London, England
and California, Public Service Act
(1973, 2nd Sess., chap. 143, sec.
74(1))..._ _ __ _ 	
Subtotal, Provincial Secretary and Travel
Industry     ...
Staff reduction salary savings	
Public Service Commission
49 Public   Service   Commission   administra
tion     	
50 Grants   re   Public   Service   and   retiring
allowance    	
51 Public Service Adjudication Board	
Special    Warrant    No.    42—Negotiated
termination settlements - 	
Subtotal, Public Service Commission	
Staff reduction salary savings	
Superannuation Branch
52 Superannuation Branch administration	
Statutory—Public Service Superannuation
Act (R.S.B.C. I960, chap. 57, sec. 29)-
53 Public Service  Superannuation   and  Re
tirement Benefits     	
Statutory—Public Service Superannuation
Act (R.S.B.C. 1960, chap. 57, sec.
30 (1))   _
54 Members   of   the   Legislative   Assembly
Superannuation Act 	
55 Municipal Superannuation Act 	
Total
expenditure
150,296
Main
estimates
voted
131,888
Expenditure
over {under)
main
estimates
$
18,408
Other
authorizations^
Net
over {under)
expenditure
25,000
(6,592)
519,338
44,567
1,292,477
454,184
60,420
280,000
65,154
(15,853)
1,012,477
130,000
(64,846)
(15,853)
2,674,762
515,215
1,266,110
1,782,1162
2,910,000
580,236
1,347,486
1,508,000
(235,238)
(65,021)
(81,376)
274,116
1,012,477
(235,238)
(65,021)
(81,376)
—
10
(10)
274,116
(10)
13,269,589
13,200,000
69,589
69,589
3,712,823
190,392
141,229
85,954
3,659,102
200,000
150.000
96,354
53,721
(9,608)
(8,771)
(10,400)
128,000
(74,279)
(9,608)
(8,771)
(10,400)
10,500
63,427
5,134,905
1,164,420
182,308
583,110
5,262,452
450,000
10,500
50,000
63,380
4,237,780
1,185,068
174,720
588,182
5,496,452
450,000
(50,000)
47
897,125
(20.648)
7.588
(5,072)
(234,000)
900,000
(50,000)
47
(2,875)
(20,648)
7,588
(5,072)
(234,000)
1,250,000
1,250,000
1,250,000
—
8,140
8,140
8,140
—
47,437,450
44,053,658
1,139,410
3,383,792
1,139,410
4,397,335
(1,013,543)
1,139,410
47,437,450
42,914,248
4,523,202
4,397,335
125,867
2,248,937
2,564,830
(315,893)
(315,893)
3,609,827
21,200
3,970,000
266,600
(360,173)
(245,400)
(360,173)
(245,400)
65,371
65,371
100,000
(34,629)
5,945,335
6,801,430
274,554
(856,095)
274,554
100,000
(956,095)
274,554
5,945,335
6,526,876
(581,541)
100,000
(681,541)
1,157,308
1,153,661
3,647
3,647
49,706,880
45,120,000
4,586,880
4,586,880
131,017
27,850
135,000
50,000
(3,983)
(22,150)
(3,983)
(22,150)
 C 6
PROVINCE OF BRITISH COLUMBIA
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH  31,  1978—Continued
No.
of
vote
56
SERVICE
Ministry of the Provincial Secretary
and Travel Industry—Continued
Superannuation Branch—Continued
Employee benefits — —	
Subtotal, Superannuation Branch	
Staff reduction salary savings	
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
Total, Ministry of the Provincial Secretary and Travel Industry  -	
Staff reduction salary savings	
Ministry of the Attorney-General
Minister's office  _ —
Administration and support _	
Courts — - -
Supplement—
Special Warrant No. 55  _	
Special Warrant No. 65  _.._	
Crown Counsel  —  	
Supplement—Special Warrant No. 65-
Police services —   —
Supplement—Special Warrant No. 65-
Corrections. - _	
Supplement—
Special Warrant No. 9 	
Special Warrant No. 49 - _
Srecial Warrant No. 65 	
Regional justice co-ordination	
Supplement—Special Warrant No. l...
Legal Services Commission —
Justice Development Commission -.
Supplement—Special Warrant No. 1 —
Legal services to Government -
Supplement—Special Warrant No. 65-
Judiciary  — 	
Coroners     - —
Supplement—Special Warrant No. 65-
British Columbia Parole Board _.
Law Reform Commission - _
Criminal Injuries Compensation Act....
Public Trustee _ - 	
Fire Marshal  	
Racing Commission 	
Supplement—Special Warrant No. 25-
Land Registry Program .
Order in Council Patients' Review Board.
Supplement—Special Warrant No. 65	
Building occupancy charges—	
Computer and consulting charges	
Statutory—
Separation   allowance   for   Provincial
Judge, Provincial Court Act  (1975,
chap. 57, sec. 34 (4)) __	
Task  force  on  policing  costs,  Police
Act (1974, chap. 64, sec. 7 (4))	
Staff reduction salary savings	
Ministry of Economic Development
Minister's office   	
General administration _	
Supplement—
Special Warrant No. 13   	
Special Warrant No. 62	
Grants  - - —	
Building occupancy charges  -	
Computer and consulting charges _	
Special Warrant No. 57—Canada-British
Columbia Industrial Development Subsidiary Agreement _ _ _	
Total
expenditure
10,426,244
61,449,299
61,449,299
114,832,084
106,035
2,910,004
25,155,200
8,511,248
29,893,855
43,147,454
388,549
7,275,491
1,618,473
2,733,456
5,143,893
1,263,760
73,203
197,067
1,452,474
1,123,462
661,059
368,124
4,408,393
52,769
16,006,032
144,000
21,000
14,695
152,669,696
Main
estimates
voted
11,952,391
58,411,052
162,261
58,248,791
109,266,140
1,576,225
114,832,084       107,689,915
104,720
3,423,788
24,727,125
7,644,422
29,137,388
40,974,313
392,576
7,300,000
1,721,()00
2,277,050
5,350,841
980,080
114,416
291,353
1,500,000
1,179,013
745,692
351,078
4,503,510
50,000
16,466,107
144,000
149,378,472
2,269,670
152,669,696       147,108,802
Staff reduction salary savings .
113,313
4,670,476
1,060,580
215,933
160,000
4,000,000
10,220,302
10,220,302
141,324
5,501,806
1,100,000
227,933
160,000
7,131,063
44,206
7,086,857
Expenditure
over (under)
main
estimates
$
(1,526,147)
3,038,247
162,261
3,200,508
5,565,944
1,576,225
7,142,169
1,315
(513,784)
428,075
866,826
756,467
2,173,141
(4,027)
(24,509)
(102,527)
456,406
(206,948)
283,680
(41,213)
(94,286)
(47,526)
(55,551)
(84,633)
17,046
(95,117)
2,769
(460,075)
3,291,224
2,269,670
5,560,894
(28,011)
(831,330)
(39,420)
(12,000)
4,000,000
3,089,239
44,206
Other
authorizations1
4,590,527
4,590,527
9,087,862
9,087,862
35,000
250,000
900,000
800,000
1,138,550
39,500
1,000,000
20,000
328,000
500,000
400,000
35,000
10,000
21,000 21,000
14,695 14,695
5,491,745
5,491,745
6,837,500
110,000
4,000,000
10,947,500
Net
over (under)
expenditure
(1,526,147)
(1,552,280)
162,261
(1,390,019)
(3,521,918)
1,576,225
(1,945,693)
1,315
(513,784)
143,075
(33,174)
(43,533)
(4,909)
(24,027)
(24,509)
(430,527)
(43,594)
(206,948)
(116,320)
(41,213)
(94,286)
(47,526)
(55,551)
(84,633)
(17,954)
(95,117)
(7,231)
(460,075)
3,133,445        10,947,500
(2,200,521)
2,269,670
69,149
(28,011)
(7,778,830)
(39,420)
(12,000)
(7,858,261)
44,206
(7,814,05$)
 PUBLIC ACCOUNTS 1977/78
C 7
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH 31,  1978—Continued
No.
of
vote
87
88
89
90
91
92
SERVICE
Ministry of the Environment
Minister's office 	
General administration           	
Land and Water Management	
Supplement—
Special Warrant No. 51  -
Special Warrant No. 71 _ _	
Environmental and engineering services—
Supplement—
Special Warrant No. 7	
Special Warrant No. 28	
Environmental protection	
Environment  and  Land  Use Committee
Secretariat  -	
Provincial Land Commission  	
Building occupancy charges._ _.„	
Computer and consulting charges	
Statutory—
Agricultural Land Reserves, Land
Commission Act (1973, chap. 46, sec.
21)  _	
Land purchase, Greenbelt Act (1977,
chap. 36, sec. 11)  —
Staff reduction salary savings -	
93
94
95
96
97
98
99
100
101
102
103
104
103
106
107
108
109
110
111
112
113
114
115
Ministry of Agriculture
Minister's office   	
Deputy Minister's office  	
General administration—	
Production and marketing 	
General and financial services - —
Supplement—Special Warrant No. 37 -
Specialist and regulatory services	
Milk Board - _.	
Building occupancy charges -	
Computer and consulting charges	
Statutory—Livestock improvement,
Horned Cattle Purchases Act (R.S.B.C.
1960, chap. 176, sec. 8)  	
Staff reduction salary savings 	
Ministry of Energy, Transport
and Communications
Minister's office   	
General administration	
Engineering Branch 	
Weigh Scaie Branch	
Motor-vehicle Branch	
Motor Carrier Branch. 	
Telecommunications Service Branch   	
Communications System Development
and Regulation Branch	
Motor Carrier Commission —- -	
Transport Research and Planning Branch .
Supplement—Special Warrant No. 27	
British Columbia Energy Commission	
Supplement—Special Warrant No. 46	
British Columbia Ferries  —	
Statutory—Annual Highway Equivalent
Subsidy, British Columbia Ferry Corporation Act (1976, chap. 8, sec. 18
(2) )  - — _	
Building occupancy charges  _ —
Computer and consulting charges	
Staff reduction salary savings —...
Total
expenditure
Main
estimates
voted
Expenditure
over (under)
main
estimates
Other
authorizations1
Net
over (under)
expenditure
$
$
$
$
$
111,521
1,502,803
8,023,104
124,088
2,201,513
8,535,823
(12,567)
(698.710)
(512,719)
(12,567)
(698,710)
25,255,278
25,676,795
(421,517)
81,000
75,000
(668,719)
6,241,670
7,022,355
(780,685)
200,523
1,126,883
(1,748,923)
(780,685)
695,196
618,025
2,196,118
726,000
1,114,830
667,830
2,294,118
726,000
(419,634)
(49,805)
(98,000)
(419,634)
(49,805)
(98,000)
43,205
1,666,619
789,000
80,456,445
80,456,445
43,205
43,205
107,726
107,726
107,726
—
45,520,646
48,363,352
(2,842,706)
1,634,337
(4,477,043)
2,819,742
2,819,742
2,819,742
45,520,646
45,543,610
(22,964)
1,634,337
(1,657,301)
84,049
85,952
(1,903)
(1,903)
1,133,787
1,186,506
(52,719)
(52,719)
1,135,790
1,063,149
72,641
72,641
3,687,229
4,125.391
(438,162)
(438,162)
43,482,605
52,769,511
(9,286,906)
6,000,000
(15,286,906)
3,537,455
3,962,022
(424,567)
(424,567)
164,813
176,148
(11,335)
(11,335)
2,194,521
2,291,521
(97,000)
(97,000)
221,000
221,000
■"■■
30,278
30,278
30,278
—
55,671,527
65,881,200
(10,209,673)
6,030,278
(16,239,951)
1,311,867
1,311,867
1,311,867
55,671,527
64,569,333
(8,897,806)
6,030,278
(14,928,084)
125,013
134,140
(9,127)
(9,127)
581,615
745,512
(163,897)
(163,897)
544,511
600,906
(56,395)
(56,395)
2,379,957
2,668,076
(288,119)
(288,119)
10,794,763
14,515,844
(3,721.081)
(3,721,081)
782,294
878,840
(96,546)
(96,546)
10,858,421
11,864,584
(1,006,163)
(1,006,163)
350,636
616,780
(266,144)
(266,144)
211,434
326,596
(115,162)
(115,162)
1,733,050
548,692
1,184,358
4,732,500
(3,548,142)
1,260,632
1,122,870
137,762
212,500
(74,738)
48,378,500
29,819,800
18,558,700
1,740,619
789,000
66,372,259
2,077,940
(74,000)
14,084,186
2,077,940
18,558,700
23,503,700
64,294,319 16,162,126       23,503,700
(74,000)
(9,419,514)
2,077,940
(7,341,574)
 C 8
PROVINCE OF BRITISH COLUMBIA
No.
of
vote
EXPENDITURE FOR THE FISCAL YEAR  ENDED MARCH 31,  1978—Continued
SERVICE
Ministry of Mines and Petroleum Resources
116
117
118
119
120
121
122
123
124
125
126
127
128
Minister's office - - 	
Deputy Minister's office _ _ 	
Mineral Resources Branch  	
Petroleum Resources Branch  -	
Grants and subsidies   	
Mineral Road Program  _ _	
Prospectors' Assistance Program 	
Mineral Research Program  -	
Mineral Data Program    	
Mineral Employment Program  -
Energy Resource Evaluation Program	
Supplement—Special Warrant No. 31	
Building occupancy charges — —	
Computer and consulting charges —	
Statutory—Correction of safety hazards,
Mines Regulation Act (1967, chap. 25,
sec. 12 (2))..._ _ 	
Staff reduction salary savings 	
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
Ministry of Forests
Minister's office   	
Ministry Administration Program —	
Engineering Support Services Program —
Public Information Services Program	
Resource Management Program- _	
Special Studies Program  	
Reforestation Program —	
Research Program    _	
Fire Suppression Program  -	
Forest Protection Program 	
Inventory Program _  	
Supplement—Special Warrant No. 35	
Scaling Program _  	
Range Management Program 	
Forest Development Roads Program	
Supplement—Special Warrant No. 41	
Reservoir Waterway Improvements Program _  	
Supplement—Special Warrant No. 40 -
Building occupancy charges _	
Computer and consulting charges —	
Special Warrant No. 4—Forest Policy
Advisory Committee of British Columbia  _ _	
Staff reduction salary savings —	
146
147
148
149
150
151
Ministry of Highways and Public Works
Minister's office   _	
General administration—Highways 	
Supplement—Special Warrant No. 75	
Highway maintenance 	
Supplement—
Special Warrant No. 60 _	
Special Warrant No. 73	
Highway Construction—Capital —
Supplement—
Special Warrant No. 8	
Special Warrant No. 36	
Special Warrant No. 43	
Special Warrant No. 52 -	
Special Warrant No. 73    _
General administration—Public Works	
Statutory—Revenue Act, (R.S.B.C. 1960,
chap. 341, sec. 55 (3))	
Government building maintenance 	
Statutory—Revenue Act, (R.S.B.C. 1960,
chap. 341, sec. 55 (3))	
Total
expenditure
Main
estimates
voted
Expenditure
over (under)
main
estimates
Other
authorizations1
Net
over (under)
expenditure
$
$
$
$
$
79,233
86,016
(6,783)
(6,783)
675,888
1,061,418
(385,530)
(385,530)
3,878,596
4,127,990
(249,394)
(249,394)
1,113,191
1,405,616
(292,425)
(292,425)
54,000
54,000
—
—
790,530
1,000,000
(209,470)
(209,470)
202,044
215,000
(12,956)
(12,956)
46,320
82,000
(35,680)
(35,680)
159,605
200,000
(40,395)
(40,395)
38,433
60,000
(21,567)
(21,567)
299,431
325,000
(25,569)
175,000
(200,569)
515,614
538,614
(23,000)
(23,000)
118,000
118,000
—
—
3,892
3,892
3,892
—
7,974,777
9,273,654
(1,298,877)
178,892
(1,477,769)
712,728
712,728
712,728
7,974,777
8,560,926
(586,149)
178,892
(765,041)
105,278
101,012
4,266
4,266
18,398,237
19,421,832
(1,023,595)
(1,023,595)
9,417,731
9,830,468
(412,737)
(412,737)
572,228
591,742
(19,514)
(19,514)
6,973,645
8,055,875
(1,082,230)
(1,082,230)
357,015
522,569
(165,554)
(165,554)
18,418,485
20,853,993
(2,435,508)
(2,435,508)
2,421,640
2,800,000
(378,360)
(378,360)
7,508,997
9,202,000
(1,693,003)
(1,693,003)
8,659,281
10,100,000
(1,440,719)
(1,440,719)
5,063,109
6,000,000
(936,891)
52,748
(989,639)
9,446,684
9,800,000
(353,316)
(353,316)
1,713,747
2,000,000
(286,253)
(286,253)
6,191,538
7,000,000
(808,462)
150,000
(958,462)
3,152,984
2,500,000
652,984
800,000
(147,016)
1,617,621
1,689,621
(72,000)
(72,000)
535,000
535,000
—
—
296,594
296,594
341,300
(44,706)
100,849,814
111,004,112
(10,154,298)
1,344,048
(11,498,346)
6,978,719
6,978,719
6,978,719
100,849,814
104,025,393
(3,175,579)
1,344,048
(4,519,627)
152,532
158,130
(5,598)
(5,598)
4,244,458
4,169,162
75,296
80,000
(4,704)
144,028,277
136,239,800
7,788,477
7,760,000
2,000,000
(1,971,523)
259,856,034
179,895,078
79,960,956
4,440,000
58,000,000
561,000
2,975,000
14,000,000
(15,044)
8,241
10
8,231
8,231
1,082,272
10
1,082,262
1,082,262
 PUBLIC ACCOUNTS 1977/78
C 9
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH 31,  1978—Continued
No.
of
vote
152
153
154
155
156
157
158
159
160
161
162
163
164
165
166
167
168
169
170
171
172
173
174
175
SERVICE
Ministry of Highways and
Public Works—Continued
Construction of Provincial buildings	
Supplement—
Special Warrant No. 53  	
Special Warrant No. 75  	
Statutory—Revenue Act, (R.S.B.C. 1960,
chap. 341, sec. 55 (3))  	
Rentals     - 	
Safety Engineering Division	
Glendale laundry  —
Building occupancy charges	
Computer and consulting charges _	
Staff reduction salary savings...
Ministry of Education
Minister's office  —	
Administration and support services —
Supplement—
Special Warrant No. 38 	
Special Warrant No. 39— - -
Special Warrant No. 45 _ _	
Special Warrant No. 66 _ 	
Special Warrant No. 70 - _ 	
Basic Education K-XII Program  	
Statutory—Provincial Home-owner Grant
Act (R.S.B.C. 1960, chap. 308, sec. 15).
Post-secondary Education—Universities	
Supplement—Special Warrant No. 32	
Post-secondary   education—commu n i t y
colleges and others — - _	
Student Aid Programs	
Teachers' Pension Fund _.	
Metric conversion— - _ 	
Advances re rural school taxes—net	
Statutory—Public Schools Act (R.S.B.C.
1960, chap. 319, sec. 197 (10)) 	
Building occupancy charges   _	
Computer and consulting charges	
Statutory—
Transfer of property to Province, The
Notre Dame University of Nelson
Act (1977, chap. 82, sec. 10) 	
Pacific Vocational Institute start-up
costs, Colleges and Provincial Institutes Act (1977, chap. 67, sec. 84)	
Trinity Western College, Colleges and
Provincial Institutes Act (1977, chap.
67, sec. 84)   _ 	
Staff reduction salary savings	
Ministry of Health
Minister's office  — -	
Deputy Minister's office and support services  — —	
Supplement—Special Warrant No. 18	
Community Health Programs:
Deputy  Minister  and  Branch support
services   -	
Public Health Programs	
Supplement—
Special Warrant No. 16 _	
Special Warrant No. 17  —
Special Warrant No. 19	
Mental Health Programs.   	
Special Health Services 	
Other health care expenditures	
Supplement—Special Warrant No. 16....
Total
expenditure
$
5,257,561
Mam
estimates
voted
10
Expenditure
over (under)
main
estimates
5,257,551
Other
authorizations1
Net
over (under)
expenditure
1,000,000
500,000
4,299,879
1,532,129
10,244,582
316,000
10
4,786,793
1,586,334
10,699,582
316,000
(10)
(486,914)
(54,205)
(455,000)
3,757,551
(10)
(486,914)
(54,205)
(455,000)
431,021,965
337,850,919
1,838,022
93,171,046
1,838,022
96,164,044
(2,992,998)
1,838,022
431,021,965
336,012,897
95,009,068
96,164,044
(1,154,976)
120,506
4,565,039
133,168
5,064,827
(12,662)
(499,788)
(12,662)
564,202,106
363,700,000
502,106
150,000
106,588
36,700
152,156
345,000
(1,290,232)
190,898,040
191,866,037
(967,997)
502,106
400,000
(1,367,997)
111,637,739
9,070,648
38,225,809
191,377
2,112,655
118,633,963
11,179,254
38,300,000
195,630
10
(6,996,224)
(2,108,606)
(74,191)
(4,253)
2,112,645
(6,996,224)
(2,108,606)
(74,191)
(4,253)
18,392,874
232,000
19,209,874
232,000
(817,000)
2,112,645
(817,000)
231,506
231,506
231,506
—
136,202
136,202
136,202
—
568,000
568,000
568,000
—
940,584,501
948,514,763
805,358
(7,930,262)
805,358
4,740,903
(12,671,165)
805,358
940,584,501
947,709,405
(7,124,904)
4,740,903
(11,865,807)
103,293
107,670
(4,377)
(4,377)
1,215,216
1,414,550
(199,334)
75,000
(274,334)
2,744,080
25,896,463
2,870,519
27,193,153
(126,439)
(1,296,690)
(126,439)
12,561,368
13,723,667
8,316,934
16,128,032
15,330,884
9,688,020
(3,566,664)
(1,607,217)
(1,371,086)
89,548
100,000
2,437,324
144,730
(3,923,562)
(3,566,664)
(1,607,217)
(1,515,816)
 C 10
PROVINCE OF BRITISH COLUMBIA
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH 31,  1978—Continued
No.
of
vote
SERVICE
Ministry of Health—Continued
176 Office of the Deputy Minister of Medical
and Hospital Programs  	
177 Hospital Programs — _ 	
Supplement—Special Warrant No. 19	
178 Government Institutions  _	
179 Forensic Psychiatric Services 	
180 Medical Services Commission — —
181 Emergency Health Services 	
182 Building occupancy charges.— - —
Supplement—
Special Warrant No. 16  _	
Special Warrant No. 19-
183   Computer and consulting charges	
Special   Warrant   No.   50—Out-of-court
settlement —  	
Staff reduction salary savings _	
Total
expenditure
61,745
594,766,410
49,038,718
2,867,246
207,300,000
20,063,364
15,863,461
168,000
20,092
954,710,057
Main
estimates
voted
63,980
615,621,231
53,084,751
3,106,101
207,300,000
20,923,537
16,568,461
168,000
989,568,889
8,331,533
Expenditure Qth
°Veri?£fe,) authori-
estimates -«°nsl
$ $
(2,235)
(20,854,821)
(4,046,033)
(238,855)
(860,173)
(705,000)
(34,858,832)
8,331,533
31,182,676
24,102
65,000
20,092 20,092
34,138,472
Net
over (under)
expenditure
(2,235)
(52,037,497)
(4,046,033)
(238,855)
(860,173)
(794,102)
(68,997,304)
8,331,533
954,710,057       981,237,356       (26,527,299)      34,138,472        (60,665,771)
184
185
186
187
188
189
190
191
192
193
194
Ministry of Human Resources
Minister's office.
Administration and community service	
Supplement—Special Warrant No. 48	
Services for families and children	
Supplement—
Special Warrant No. 48—  	
Special Warrant No. 74  	
Services for seniors and handicapped	
Supplement—Special Warrant No. 48	
Health services  -	
Supplement—Special Warrant No. 74	
Community programs -  	
Supplement—Special Warrant No. 48	
Income Assistance Program  	
Special programs for the retarded _	
Burns   Lake   Community   Development
Association	
Building occupancy charges	
Computer and consulting charges .
Staff reduction salary savings
133,983
33,041,501
54,983,131
155,251,563
39,705,845
23,348,717
191,413,797
36,698,760
203,239
9,761,255
599,000
545,140,791
146,516
32,660,388
60,273,365
167,023,863
37,100,000
30,793,471
193,920,046
39,407,911
206,800
10,195,255
599,000
572,326,615
2,500,000
(12,533)
381,113
(5,290,234)
(11,772,300)
2,605,845
(7,444,754)
(2,506,249)
(2,709,151)
(3,561)
(434,000)
(27,185,824)
2,500,000
(12,533)
(6,099,487)
(8,485,134)
(12,106,500)
(194,155)
(7,473,754)
(2,506,249)
(2,709,151)
(3,561)
(434,000)
(40,024,524)
2,500,000
545,140,791        569,826,615        (24,685,824)      12,838,700        (37,524,524)
6,480,600
1,694,900
1,500,000
334,200
2,800,000
29,000
12,838,700
Ministry of Municipal Affairs and Housing
195 Minister's office   	
196 Office of the Deputy Minister—Municipal
Affairs ._ - 	
197 Grants, Contributions and subsidies _
Supplement—Special Warrant No. 20	
Statutory—
Municipalities Aid Act (R.S.B.C. 1960,
chap. 259, sec. 4) _ _ 	
Provincial Home-owner Grant Act
(R.S.B.C. 1960, chap. 308, sec. 15)_.
198 Office of the Deputy Minister—Housing—
199 Housing and Development  	
Statutory—Mobile Home Act (1977, chap.
40, sec. 46)   __ 	
200 Central Ministry Services  _	
201 Building occupancy charges —
202 Computer and consulting charges	
Special   Warrant   No.   2—Police   costs;
Williams   Lake,   Mackenzie,   Comox,
Sidney, and Langley City — 	
Special Warrants No. 6 and 61—Northeast Coal Development Project	
Staff reduction salary savings
161,534
5,390,944
142,506,124
2,607,400
62,559,069
357,334
519,638
255,000
618,750
591,755
215,567,548
147,856
6,861,776
140,677,000
3,051,234
71,770,500
361,115
542,638
255,000
223,667,119
649,818
13,678
(1,470,832)
1,829,124
(443,834)
(9,211,431)
(3,781)
(23,000)
150,000
1,390,152
288,972
168,310
618,750 618,750
591,755 1,781,989
(8,099,571) 4,398,173
649,818
13,678
(1,470,832)
(443,834)
(9,379,741)
(3,781)
(23,000)
(1,190,234)
(12,497,744)
649,818
215,567,548       223,017,301
(7,449,753)        4,398,173        (11,847,926)
 PUBLIC ACCOUNTS 1977/78
C 11
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH 31,  1978—Continued
No.
of
vote
203
204
205
206
207
208
209
210
211
SERVICE
Ministry of Labour
Minister's office  	
Ministerial administration and support
service  -   - —
Supplement—Special Warrant No. 30	
Job Training and Employment Opportunity Program   	
Supplement—Special Warrant No. 3	
Occupational Environment and Compensation Advisory Services  	
Collective Bargaining and Employment
Standards Program  	
Human Rights Programs — -	
Labour Relations Board
Building occupancy charges	
Computer and consulting charges.
Staff reduction salary savings	
Ministry of Consumer and Corporate Affairs
212
213
214
215
216
217
218
219
220
221
222
223
224
225
226
227
228
229
230
Minister's office  ~.
Administrative and support...
Legal Services Branch	
Trade Practices Branch .
Community Programs Branch 	
Debtor Assistance Branch —	
Companies Branch  - 	
Insurance and Real Estate Branch	
Supplement—Special Warrant No. 69	
Superintendent of Brokers -	
Supplement—Special Warrant No. 10	
Credit Unions and Co-operatives Branch...
Supplement—Special Warrant No. 64 _
Film Classification Branch 	
Supplement—Special Warrant No. 11	
Rentalsman   —	
Rent Review Commission 	
Liquor Control and Licensing Branch	
British    Columbia    Liquor    Distribution
Branch  „ - 	
Corporate  and  Financial  Services Commission  —   —	
Trust Companies Branch —	
Building occupancy charges —	
Supplement—Special Warrant No. 12	
Computer and consulting charges— 	
Statutory—
Travel Agents Registration Act  (1977,
chap. 22, sec. 36)— 	
Residential Tenancy Act  (1977, chap.
61, sec. 82) _	
Staff reduction salary savings	
Total
Main
estimates
expenditure
over (under)
Other
authori
Net
over (under)
voted
estimates
zations1
expenditure
$
$
$
$
$
127,567
131,284
(3,717)
(3,717)
1,534,557
1,632,508
(97,951)
250,000
(347,951)
31,787,679
28,036,112
3,751,567
7,500,000
(3,748,433)
1,210,094
1,179,094
31,000
31,000
2,395,136
2,583,042
(187,906)
(187,906)
381,994
402,488
(20,494)
(20,494)
1,128,949
1,147,204
(18,255)
(18,255)
866,205
905,205
(39,000)
(39,000)
181,000
181,000
—
—
39,613,181
36,197,937
3,415,244
7,750,000
(4,334,756)
657,803
657,803
657,803
39,613,181
35,540,134
4,073,047
7,750,000
(3,676,953)
110,343
108,644
1,699
1,699
581,292
641,818
(60,526)
(60,526)
79,200
87,122
(7,922)
(7,922)
645,905
648,720
(2,815)
(2,815)
711,106
922,804
(211,698)
(211,698)
391,502
397,838
(6,336)
(6,336)
992,504
1,007,540
(15,036)
(15,036)
360,116
358,320
1,796
14,000
(12,204)
723,406
777,732
(54,326)
5,050
(59,376)
210,870
217,440
(6,570)
22.000
(28,570)
109,392
111,347
(1,955)
9,000
(10,955)
580,649
1,331,092
(750,443)
(750,443)
423,785
439,358
(15,573)
(15,573)
997,479
1,064,138
(66,659)
(66,659)
7,481
45,000
(37,519)
(37,519)
23,669
30,144
(6,475)
(6,475)
49,750
86,772
(37,022)
(37,022)
783,619
818,619
(35,000)
Ministry of Recreation and Conservation
231 Minister's office  	
232 General administration  	
233 Information and education  	
Supplement—Special Warrant No. 33—
234 Marine resources—  	
Supplement—Special Warrant No. 54—
235 Fisheries Enhancement Program  -
236 Fish and Wildlife  -	
237 Federal and other agency programs	
Supplement—Special Warrant No. 34—
238 Creston Valley Wildlife Management—
239 Parks operation  _ 	
240 Parks—Capital Program   	
Supplement—Special Warrant No. 44...
159,000
159,000
61,148
(96,148)
42,002
42,002
42,002
—
646,979
646,979
646,979
—
8,630,049
9,253,448
(623,399)
800,179
(1,423,578)
620,330
620,330
620,330
8,630,049
8,633,118
(3,069)
800,179
(803,248)
83,124
102,752
(19,628)
(19,628)
802,140
1,009,729
(207,589)
(207,589)
361,251
438,598
(77,347)
62,000
(139,347)
615,334
558,778
56,556
85,000
(28,444)
263,808
300,000
(36,192)
(36,192)
8,549,144
9,348,676
(799,532)
(799,532)
676,662
640,000
36,662
240,950
(204,288)
129,862
129,750
112
112
13,965,408
15,501,080
(1,535,672)
(1,535,672)
5,225,985
4,500,000
725,985
923,000
(197,015)
 C 12
PROVINCE OF BRITISH COLUMBIA
No.
of
vote
241
242
243
244
245
246
247
248
249
250
251
252
253
254
EXPENDITURE FOR THE FISCAL YEAR ENDED MARCH 31,  1978—Continued
Total Main "SPffiS Other                     Net
SERVICE                                        ...niSiS!,,, estimates OVer„(X     } authori-            over (under)
expenditure vwed ^ates zations1            expenditure
Ministry of Recreation and                                 $ $ $ $                           $
Conservation—Continued
British Columbia National Parks (Pacific
Rim)  -                732,529 2,158,000 (1,425,471) (1,425,471)
Youth Crew    _..._ -                999,440 1,000,000 (560) (560)
Heritage Conservation Branch - _             1,127,263 1,468,805 (341,542) (341,542)
Heritage Conservation Capital Program.—                76,203 100,000 (23,797) (23,797)
Recreation and Fitness Branch  -            1,000,002 1,546,778 (546,776) (546,776)
Recreation Facilities Program                 291,927 446,588 (154,661) (154,661)
Recreation facilities grants               8,000,000 8,000,000 — —
Grants-in-aid of Regional Park Development               1,180,000 1,180,000 — —
Cultural Services Branch                 307,599 427,274 (119,675) (119,675)
Library Services Program  -             3,733,396 3,846,362 (112,966) (112,966)
British Columbia Arts Program                     8,948 74,076 (65,128) (65,128)
Capital Improvement District                427,495 470,000 (42,505) (42,505)
Building occupancy charges—             2,478,501 2,588,501 (110,000) (110,000)
Computer and consulting charges                351,000 351,000 — —
51,387,021 56,186,747 (4,799,726) 1,310,950           (6,110,676)
Staff reduction salary savings  1,247,570 1,247,570 1,247,570
51,387,021 54,939,177 (3,552,156) 1,310,950           (4,863,106)
Subtotal budgetary expenditure   3,895,464,582 3,866,328,564 29,136,018 241,457,619      (212,321,601)
Total staff reduction salary savings—  36,428,564 36,428,564 36,428,564
Total budgetary expenditure _    3,895,464,582 3,829,900,000 65,564,582 241,457,6193    (175,893,037)
Nonbudgetary Expenditure Charged to
Current Revenue
Special Purpose Funds
Transit   Fund
Advance—Provincial   Transit   Fund    (Special
Warrant No. 5)—     5,000,000
Grant—Provincial Transit Fund (Special Warrant No. 58) re Burrard Inlet Ferries construction costs- _ _ _  1,665,099
Crown Corporations
Advance—Ocean   Falls   Corporation    (Ocean
Falls Corporation Act, 1973, chap. 64, sec.
9)..._     — 2,000,000
Grant—British Columbia Buildings Corporation (Special Warrant No. 68) re acquisition
of Lansdowne Campus of Camosun College.-. 4,500,000
Grant—British   Columbia   Railway   Company
(British Columbia Railway Company Grant
Act, 1977, chap. 46, sees. 1 and 2) re Federal
Contribution, Dease Lake rail line — 81,168,080
Other
Purchase of additional shares in Swan Valley
Foods Limited (Special Warrant No. 26)  7,631,250
Transfer of Investment in Canadian Cellulose
Company Ltd. shares to British Columbia
Resources Investment Corporation in exchange for noncash asset (promissory note)... 1,824,942
Total nonbudgetary expenditure ___     103,789,371
Combined general fund expenditure  3,999,253,953
1 "Other authorizations" comprise statutory and special warrant authorizations as indicated.
2 Pursuant to sections 12a and 12b of the Constitution Act, administration of Vote 33 was transferred to the Ministry of
Energy, Transport and Communications effective December 8, 1977.
3 The total of $241,457,619 represents statutory authorizations of $41,426,304 and special warrant (Financial Control Act)
authorizations of $200,031,315.
  

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