1.1 The present document contains the text of the policy, as
approved on February 10th, 2000 and is effective
immediately.
2.1 The government's intent in this policy is to optimize the
process for disposing of surplus moveable Crown assets,
consistent with its overall objectives of modernizing
comptrollership and increasing the use of private sector service
providers wherever feasible and justifiable in terms of
costs.
2.2 The Surplus Crown Assets Act (R.S., c. S-20, s. 1.)
was amended in 1993 to provide departments with additional
options for the disposal of surplus moveable assets, subject to
terms and conditions to be prescribed by Treasury Board of
Canada. Associated with the passage of this amendment, Treasury
Board of Canada Secretariat (TBS) authorized six pilot projects
to evaluate the feasibility of alternate mechanisms for disposal.
TBS then carried out analysis and interdepartmental consultation
at the national and regional levels to determine what disposal
terms and conditions would be appropriate. Consequently, Treasury
Board has approved the policy and guidelines herein to provide
departments and agencies with direction and guidance on the
disposal of surplus moveable Crown assets.
3.1 To provide the best overall outcome for the government of
Canada in its disposal of surplus moveable assets, to the end
that
3.1.1 the highest net value is obtained through disposal;
3.1.2 there is an open opportunity for Canadians to
participate in the disposal;
3.1.3 the disposal process is characterized by prudence,
probity and integrity;
3.1.4 the health and safety of persons and the environment are
protected; and
3.1.5 heritage items are treated appropriately.
4.1 Surplus Crown assets are to be disposed of by means of
sale to the public at market value. However, under circumstances
set out in the Appendix, Section 5, the minister through whom a
department reports to Parliament may authorize disposal of a
surplus Crown asset through gratuitous transfer, through sale to
a limited market, or through sale at other-than-market value. The
department that has custody or control of an asset (the
custodian) is to be responsible for identifying and declaring
assets which are surplus to its requirements. The custodian is
responsible for all costs of ownership throughout an asset's
life-cycle (planning, acquisition, operation and disposal) and is
either entitled to net benefits or is responsible for net costs
on disposal of that asset.
4.2 Wherever feasible and cost-effective, surplus Crown assets
are to be sold to the general public by private sector
contractors. Sales are to be conducted under contracts and
standing offers put in place by Public Works and Government
Services Canada (PWGSC) and used by all departments. In cases
where sale by a contractor is not feasible or cost-effective,
disposal by sale is to be conducted by PWGSC itself. To the
greatest extent practicable, the benefits and costs of sales are
to be assigned directly to the respective custodians.
4.3 Mechanisms, channels and statements of work for the
disposal of surplus Crown assets are to be developed through
consultation with representatives of user departments in disposal
panels. (User departments are those with these or similar
assets.) Disposal panels are to respond to users needs in an
efficient and timely manner. Custodians wishing to introduce
alternative disposal mechanisms are to present their proposals to
the applicable disposal panel for consideration. If the proposal
is accepted, the new mechanism is to be established by PWGSC for
the use of departments as appropriate. If the disposal panel does
not accept the proposal, the initiating department may make a
submission to Treasury Board requesting approval to use an
alternative mechanism. This submission must present a clear
business case showing that the proposed disposal mechanism will
result in greater overall benefit to the Crown than those already
put in place by the disposal panel. The submission must also set
out the audit process that the department will use to verify that
these benefits are actually realized.
4.4 In cases where the estimated costs of a disposal
(described in the Appendix, Section 9) are likely to exceed the
proceeds of sale, a custodian may choose not to sell the asset,
but instead to dispose of it by:
4.4.1 gratuitous transfer to a Crown corporation or to another
level of government;
4.4.2 gratuitous transfer to a recognized charitable or
non-profit organization;
4.4.3 for assets located outside Canada, gratuitous transfer
to a government, charity or non-profit organization recognized by
the host country, by any treaty organization of which Canada is a
member, or by the United Nations; or
4.4.4 destruction of the asset in an environmentally
appropriate manner and with due regard to public scrutiny.
4.5 Surplus assets are sold, donated or transferred "as is,
where is," with no warranty as to condition, serviceability or
fitness for use. The government assumes no liability for
accident, injury or loss resulting from the use of the asset
subsequent to disposal.
4.6 Custodians are responsible for ensuring that any
restrictions regarding disposal that were imposed as a condition
of original purchase (e.g. international agreements or treaties,
licensing requirements) are respected, and are imposed on any
subsequent buyer with full force and effect. It is the
custodian's responsibility to ensure that the buyer of any such
assets can be relied on to meet these obligations. Where such
assets are being sold for museum display or scrap, it is the
custodian's responsibility to ensure that the assets are
permanently disabled to the satisfaction of all parties to the
original purchase agreement.
4.7 Custodians must take into account the heritage value of
surplus assets. When appropriate, representative examples of
surplus equipment will be preserved and made available to
organizations such as federal, provincial, municipal and
not-for-profit museums, or municipalities, Canadian Legions and
veteran associations. With the exception of items designated for
federal museums and Canadian Forces museums, all lethal equipment
(e.g. military and police weapons and weapon delivery systems)
must be rendered permanently inoperable.
5.1 This policy applies to departments as defined in Section 2
of the Financial Administration Act and optionally at
their discretion to federal bodies as defined in Section 2 of the
Surplus Crown Assets Act.
6.1 Disposal panels are to be formed, each consisting of
representatives from user departments and from PWGSC.
6.2 If a pilot project department has a contract with a
private sector disposal service in force when this policy takes
effect, the department may continue to use this contract service
for a maximum of five years from the effective date of this
policy, provided that this use is compliant with the original
memorandum of understanding of the pilot project.
6.3 Private sector disposal mechanisms that have been found
successful during the pilot projects are to be used to the
greatest extent possible when establishing permanent mechanisms
for the use of all departments. Where deemed suitable by the
applicable disposal panel and to the extent permitted by
contracting regulations, disposal contracting arrangements under
pilot projects may be expanded to accommodate the disposal
requirements of other departments and used as a basis for future
operations. In such cases, the applicable disposal panel will
initiate expansion of these contracts with the assistance of
PWGSC.
6.4 Custodians must put into place appropriate measures to
monitor sales and reconcile proceeds for all assets sold through
contractors and through PWGSC.
6.5 Custodians must set up appropriate accounting procedures
for disposal revenues and expenditures in accordance with
Treasury Board accounting policy and practices. (See Appendix
Section 9.14.1 below.)
7.1 To assess the utility of this policy, information will be
obtained from sources such as meetings of disposal panels,
reviews of receipts and selling costs from surplus asset
disposals, custodian departmental monitoring, internal audits and
program evaluations.
7.2 A Treasury Board Secretariat led, inter-departmental
evaluation of the policy will be conducted and concluded within a
three year period from the effective date of the policy.
8.1 Please direct all enquiries about the implementation or
application of this policy to:
Senior Materiel Advisor
Materiel and Project Management Division
Comptrollership Branch
Treasury Board of Canada Secretariat
Telephone Number: (613) 957-0205
Facsimile Number: (613) 952-1381
1.
Introduction
1.1 These guidelines are provided to assist government
departments in managing their disposal operations. In general,
disposal operations should aim to recover residual investment
from assets that are surplus to government requirements. In some
cases, however, the public interest may out-balance the need to
maximize disposal revenues. In other cases, where assets have no
residual value, they should be removed from government ownership
at minimum cost.
1.2 The guidelines provided in this chapter proceed from the
following general principles:
1.2.1 Surplus assets should normally be sold at fair market
value in a manner that maximizes revenue and minimizes expenses.
To the greatest extent feasible and cost-effective, the actual
selling should be done by the private sector.
1.2.2 In exceptional circumstances, valuable surplus assets
may be transferred gratuitously or sold at less than fair market
value when, in the opinion of the custodial minister, such action
serves the public interest better than sale on the open
market.
1.2.3 Assets with little or no market value may be transferred
gratuitously or may be scrapped in an environmentally acceptable
manner when, in the opinion of the custodial minister or persons
duly authorized by that minister, this is the most cost-effective
means of disposal and will withstand public scrutiny.
1.2.4 To the greatest extent feasible, the general public
should have the opportunity to purchase surplus Crown assets.
2.
Applicable Laws and Regulations
2.1 Custodians should ensure that all disposals conform to
applicable federal laws and regulations, including but not
limited to the Criminal Code of Canada, the Financial
Administration Act, the Surplus Crown Assets Act, the
Atomic Energy Control Act, the Explosives Act, the
Hazardous Products Act, the Pest Control Products
Act, the Official Languages Act, the National
Archives Act, the Conflict of Interest and Post-Employment
Code for the Public Service, Government Contracts Regulations,
other Treasury Board policies, and all applicable provincial,
municipal and local laws and regulations. Applicable taxes should
be collected and remitted on all sales. These would include the
GST, PST or HST in Canada, or locally applicable taxes for sales
conducted outside Canada.
3.
Ethics
3.1 The disposal of surplus Crown assets attracts considerable
interest in industry and the general public. Public servants and
contractors involved in the disposal process should demonstrate
prudence, probity and integrity in all their actions. Care should
be taken to avoid any actual or perceived conflict of
interest.
4.
Treatment of Surplus Assets
4.1 Value of Assets
4.1 Whether an asset has marketable value or not, owning it
costs money. With low-value assets, the costs of storage,
handling and administration can quickly add up to more than the
value of the item. With high-value items, the capital tied up in
it is unavailable for other expenditures. Timely identification
and disposal of surplus assets is therefore essential.
4.1 Transfer to Another Department or Agency
4.2 Where practical and cost-effective, a custodian who
determines that an asset is no longer required should offer the
asset to other government departments or agencies before
declaring it surplus. Should a need be found for the asset
elsewhere within government, a transfer may be arranged directly
between the disposing and receiving custodian, including payment
of shipping, handling and administrative costs incurred by the
disposing custodian to effect the transfer.
4.3 Declaring an Asset Surplus
4.3.1 Assets no longer required by government should be
declared surplus promptly, and disposal action initiated. Typical
reasons for disposal include:
4.3.1.1 the asset is no longer needed due to changes in
operational requirements;
4.3.1.2 the asset is technologically obsolete or incompatible
with other assets;
4.3.1.3 the asset has reached the point at which it is most
economical to dispose of it (from age, usage, mileage, etc.),
thus minimizing through-life costs;
4.3.1.4 the asset is beyond economical repair;
4.3.1.5 the costs of capital tied up, storage, handling, etc.,
cannot be justified when compared with the cost of alternatives,
such as rental or just-in-time procurement; and,
4.3.1.6 continued possession or use of the asset contravenes
occupational health or safety standards, or the asset contains
hazardous materials, and so forth.
4.4 Preparing an Asset for Disposal
4.4.1 It is the custodian's responsibility, before
transferring an asset or releasing it for sale, to search it
thoroughly in order to find and remove all:
4.4.1.1 government and departmental property markings,
inventory stickers, etc.;
4.4.1.2 ammunition, pyrotechnics, drugs or other dangerous or
controlled substances;
4.4.1.3 hazardous material (see Section 10 below);
4.4.1.4 classified, protected or other sensitive information
contained in hard copy, electronic storage media, microfiche or
other form which, if disclosed, would result in a breach of the
Official Secrets Act or Privacy Act, or would otherwise cause
embarrassment to the government (see Section 8.2.4 below for
guidance on erasing data from computer hard disks and removable
disks);
4.4.1.5 classified equipment, such as Tempest or other
encryption equipment and high-security safes; and,
4.4.1.6 valuable material (e.g. cash, securities, precious
metals, tools, jigs and fixtures) in containers which are
intended to be sold empty, such as safes, cabinets, filing
cabinets and tool boxes.
5.
Options for Disposal
5.1 Disposal for proceeds: This category consists of
assets where the anticipated revenue from the sale exceeds the
expected costs of sale (e.g. transportation, handling and storage
where necessary, advertising, preparing for and conducting the
sale, recording and distributing the proceeds) and for which the
custodian wishes to seek an open-market price. Assets in this
category are to be disposed of using processes established by the
applicable disposal panel.
5.2 Trade-in: This category consists of assets that are
offered as partial payment for purchases of new items. Assets in
this category are to be disposed of as part of the procurement
contract for the new item. (NOTE: Trade-ins are not authorized
for passenger vehicles, station wagons and light trucks, or for
computers and related equipment addressed in Section 8.2,
Computers for Schools Program, below.)
5.3 Sale to a limited market, or sale at other-than-market
value: This category consists of assets that the government
has decided to sell to a restricted group of purchasers at what
may be less than open-market price, in order to meet specific or
general program purposes of government. (For example, this might
include artifacts sold at a nominal price to bona-fide museums
for display purposes.) The terms of such sales must be approved
by the minister through whom the custodian department reports to
Parliament. An officer of PWGSC should normally conduct sales of
this type. Contractors should not normally be used.
5.4 Gratuitous transfer (donation) of valuable assets:
This category consists of assets which have marketable value, but
which are being donated to recipients which a custodian minister
designates in order to meet specific or general program purposes
of government. Some donations are pre-approved as part of an
ongoing government program (e.g. the Computers for Schools
Program). In all other cases, the donation must be approved by
the minister through whom the department reports to Parliament.
Gratuitous transfers should normally be carried out by an officer
of the custodian department. Contractors should not normally be
used.
5.5 Cost-minimizing disposal: This category consists of
low-value assets where the anticipated costs of selling the goods
exceeds expected proceeds of sales. In this situation, a
custodian may dispose of assets by donating them to a Crown
corporation, a federal agency, another level of government, or a
charitable or non-profit organization. Failing that, custodians
may arrange for the assets to be recycled or otherwise disposed
of in a manner that is environmentally appropriate and will
withstand public scrutiny. These actions should normally be
carried out by the custodian department. (NOTE: Custodians should
consider whether scrap accumulated over time, e.g. scrap metal
shavings, might be disposed of under disposal for
proceeds, Sections 5.1 and 6.)
5.6 Military artifacts: The Minister of National
Defence or an appropriately qualified person specifically
designated by the Minister may authorize the disposal of military
artifacts through gratuitous transfer, sale to a limited market,
or sale at other than market value. This authority is intended
for disposal of military items for heritage, historical,
memorial, museological, static display or like purposes to
recipients such as community oriented organisations (e.g.
Canadian legions), museums, other levels of government and
non-profit organisations. Any such disposal should carry with it
a prohibition of subsequent transfer or sale without the
expressed permission of the Minister of National Defence.
6.
Disposal for Proceeds
6.1 Process:
6.1.1 All government departments and agencies conducting
disposals for proceeds (Section 5.1 above) will use disposal
processes put in place by PWGSC. These disposal processes will be developed in
consultation with national and regional disposal panels
consisting of representatives from user departments and agencies.
A representative from TBS is to be included in the membership of
national disposal panels, and may be included in regional panels.
Disposal panels will identify and develop disposal channels,
mechanisms and contract statements of work appropriate to the
particular national or regional surplus assets assigned to them.
In all cases where it is feasible and cost-effective, PWGSC will
retain the services of private sector contractors to perform
required transportation, handling, storage, marketing and sales,
and the collection and remittance of proceeds.
6.2 Responsibility of the Custodian in Disposal for
Proceeds
When a custodian declares an asset surplus and opts to
dispose of it for proceeds, the custodian is responsible for:
6.2.1 contacting the appropriate disposal agent for the item
(a contractor or PWGSC, as determined by the disposal panel) to
arrange the sale;
6.2.2 considering in consultation with the designated disposal
agent what preparatory work should be done to maximize the net
return on the sale of the asset, and deciding who will do any
work selected;
6.2.3 setting a minimum acceptable sale price for the asset,
if the custodian so wishes;
6.2.4 providing the disposal agent with information about the
asset's condition and related documentation required to
facilitate the sale;
6.2.5 making the asset available to the disposal agent at the
agreed time and location, and in the agreed condition for
sale;
6.2.6 monitoring the progress of the sale, receiving and
reconciling proceeds of the sale, and paying all applicable fees
and expenses;
6.2.7 resolving disputes and addressing ministerial inquiries
related to sales of custodian's assets conducted by the
contractor;
6.2.8 maintaining appropriate accounting records in accordance
with applicable Treasury Board policy (see Section 14);
6.2.9 notifying PWGSC and the disposal panel of any
difficulties or shortcomings encountered in the disposal process,
and collaborating with PWGSC in monitoring the performance of the
contractor;
6.2.10 participating as a member in the disposal panel that is
responsible for this type of asset, or providing user input to
it; and
6.2.11 requiring that materiel managers obtain appropriate
materiel management training and certification.
6.3 Responsibilities of PWGSC in Disposal for Proceeds
In disposal for proceeds, PWGSC is responsible for:
6.3.1 establishing and chairing disposal panels and providing
administrative support and expertise on the disposal process for
disposal panels;
6.3.2 collaborating in the management of the disposal process
and services;
6.3.3 providing strategic, procedural and technical advice on
the disposal of surplus government assets;
6.3.4 putting into place disposal service contracts and
standing offers, and arranging necessary ministerial
authorization for the execution of contracts, bills of sale and
documents transferring ownership;
6.3.5 providing disposal services directly, including the
management of proceeds, in cases where the use of contractor
services is not feasible or cost-effective; and
6.3.6 monitoring the performance of contractors to ensure
compliance with contract terms and conditions, timely completion
of all required tasks and the integrity and transparency of the
disposal process. This monitoring will be carried out using
reports from users and contractors, including electronic reports
where feasible.
7.
Trade-ins
7.1 Custodians may trade in surplus assets as partial payment
for new procurements. When doing so, custodians should ensure
that credit offered for trade-in reflects fair market value, and
that the procurement contract clearly stipulates terms and
conditions of the trade-in. Custodians should ensure that
appropriate records of trade-in activity are kept for accounting
and audit purposes. Trade-ins are not authorized for cars,
station wagons or light trucks, or for any computer equipment
identified in Section 8.2, Computers for Schools Program.
8.
Disposal by Limited Market Sale or
Gratuitous Transfer
8.1 In cases where the asset has marketable value exceeding
the projected cost of sale, a decision to dispose of the asset at
lower than market value or by gratuitous transfer constitutes a
donation from the government to the recipient. Forgoing potential
revenue is equivalent to an expenditure of funds. This decision
must be taken by the minister through whom the custodian reports
to Parliament. The person authorizing this sale or
transfer should ensure that the arrangement constitutes the best
use of the asset, and that the decision would withstand the test
of public scrutiny.
8.2 Computers for Schools Program:
8.2.1 The federal government has committed itself to make
Canada the most connected nation in the world. Industry Canada's
Computers for Schools (CFS) Program, an important initiative in
support of this "connectedness" agenda, has a mandate to collect
surplus desktop and laptop computers and associated peripherals,
refurbish them and donate them in fully working condition to
elementary and secondary schools and public libraries. A rigorous
allocation procedure has been put in place to ensure equitable
distribution of these assets across Canada.
8.2.2 All personal computers (MS-DOS/Windows and MacIntosh)
and associated monitors, keyboards, mice, printers, modems,
servers, hubs, network cards, disk operating systems and related
equipment which become surplus to government requirements must be
offered intact to the Industry Canada Computers for School
Program. Custodians are not authorized to sell, trade, donate or
otherwise dispose of these assets prior to making this offer.
Custodians are responsible for disposal of any equipment that is
not accepted by the CFS Program.
8.2.3 The configuration of incoming computers is carefully
monitored and recorded by CFS. Custodians should ensure that
surplus computers are not "cannibalized" or otherwise rendered
unusable prior to transfer. The practice of removing hard drives,
random access memory (RAM) and other essential components from
computers before transferring them should only be done in those
rare situations where security requirements dictate it.
8.2.4 The data on the hard drives of all computers received at
CFS facilities are thoroughly erased and the disks reformatted.
Custodians with sensitive data may obtain RCMP-approved software
from their local CFS centre to erase data on hard drives prior to
transfer. In the National Capital Region, custodians may request
that a technician from the CFS Program perform this work at their
site. Bulk erasing of removable magnetic disks is also available
from the CFS Program. Custodians who are considering removing
hard drives from computers for security reasons should contact
CFS to explore possible alternatives before taking this
action.
8.2.5 This guideline is not intended to restrict the practice
of loaning computers to employees for use at home, provided this
use is a valid operational requirement. Furthermore, this
guideline does not apply to mainframe computers.
8.2.6 Further information on the Computers for School Program
may be obtained by telephoning 1-800-268-6608.
9.
Cost-Minimizing Disposal
9.1 Where the custodian estimates that the market value of an
asset is less than the costs that would be incurred to sell it
through the disposal-for-proceeds process (direct handling,
transportation and warehousing costs, marketing costs, sales fees
and commissions, staff costs, etc.), the custodian may:
9.1.1 gratuitously transfer the asset to a Crown Corporation,
federal agency, provincial government, First Nation, municipal
government or school board in Canada;
9.1.2 gratuitously transfer the asset to a recognized charity
or non-profit organization located in Canada;
9.1.3 for assets located outside Canada, gratuitously transfer
them to a recipient similar to those in Sections 9.1.1 and 9.1.2
which are recognized by the host country, any treaty organization
of which Canada is a member, or the United Nations; or,
9.1.4 if other options are not feasible, consider disposing of
the asset as unsellable scrap and having it removed as waste,
provided that such action will not cause harm to the
environment.
9.2 Custodian departments that make gratuitous transfers of
low value items under paragraph 9.1.1 to 9.1.3 above are to take
suitable measures to ensure that the recipients are selected in a
way that would be perceived by the public to be fair, equitable
and transparent. Appropriate records are to be kept for such
disposals and they should be subject to periodic audit or review.
Departments should establish other internal controls to prevent
abuse, as appropriate. Possible measures to prevent real or
perceived abuse could include but need not be limited to the
following:
9.2.1 Two individuals could be required to approve the use of
cost-minimizing disposal.
9.2.2 Two or more individuals, different than those who
approved the cost-minimizing disposal, could be used to select
the recipient. Representatives from the private sector, other
levels of government or the general the public who do not have a
direct interest in the selection could be invited to
participate.
9.2.3 A final approval signature for gratuitous transfer of
assets. Those who approved use of the cost-minimizing disposal
and who selected the recipient could be excluded from
signing.
10.
Hazardous Products and Dangerous Goods
10.1 Hazardous products include those which are or may contain
compressed gas, flammable or combustible material, oxidizing
material, poisonous or infectious material, corrosive material,
dangerously reactive material or contaminated oily fluids, heavy
greases or waxes. The treatment of these products is addressed in
the Hazardous Products Act and they are covered by the
Workplace Hazardous Material Information System (WHMIS).
10.2 Dangerous goods include drugs covered under the Food
and Drugs Act, radioactive substances covered under the
Atomic Energy Control Act, explosive substances covered by
the Explosives Act, and pesticides covered by the Pest
Control Products Act.
10.3 When preparing hazardous materials for disposal, the
disposing custodian is responsible for ensuring that the goods
are labeled in accordance with WHMIS requirements and for
providing the accompanying Material Safety Data Sheet. The
custodian is responsible for arranging and paying for testing to
identify hazardous materials or liquids contained in surplus
assets prior to disposal.
10.4 Disposal panels establishing procedures for the disposal
of hazardous or dangerous goods are to consult the PWGSC Real
Property Branch, Architecture and Engineering Services Sector,
Environmental Services Directorate, for advice.
11.
Disposal of Unique Assets
11.1 The disposal of books, periodicals and related material
is covered by the National Libraries Act and the
National Archives Act.
11.2 The disposal of artwork should be done in consultation
with the Canada Council Art Bank.
11.3 Intellectual property owned by the Crown is subject to
the Surplus Crown Assets Act and may be disposed of in
accordance with these guidelines for disposal.
11.4 When a safe is declared surplus, it must be inspected by
the Security Engineering Section (SES) of an RCMP detachment to
determine whether it is commercially saleable or if it must stay
within federal government control. Safes identified as
manufactured to government specifications, if serviceable, must
be retained within the custodian department or transferred to
another federal government department or agency. Government
pattern safes that are unserviceable must be dismantled by RCMP
SES personnel, who will retain the pieces of the mechanism that
are considered sensitive. The remaining shell or body may then be
disposed of through any of the disposal mechanisms previously
outlined.
12.
Disposal at Remote Sites and Outside Canada
12.1 Where practical, custodians with surplus assets at remote
sites and outside Canada should dispose of these for proceeds. In
areas where there is a PWGSC presence, contracts with either
domestic or foreign contractors should be established by PWGSC
for use by departments or agencies.
12.2 Alternatively, if cost-effective, the disposal service
agencies of foreign governments may be used through arrangements
negotiated by PWGSC.
12.3 Where there is no PWGSC presence, departments may make
their own arrangements directly with domestic or foreign
contractors or agencies. In such instances, the advice of the
applicable disposal panel should be solicited.
12.4 When no suitable disposal-for-proceeds option is
available, deployed assets should be relocated to a convenient
Canadian city for sale only if the anticipated proceeds of sale
exceed the anticipated relocation and selling costs.
12.5 When it is not practical for custodians to dispose of
assets for proceeds and the relocation of assets is not
cost-effective, custodial departments should use the options
described in Section 9.1 as appropriate. In foreign countries,
possible recipients would include host governments and other
organizations, such as humanitarian agencies and not-for-profit
groups that are recognized by the host country, by any treaty
organization of which Canada is a member, or by the United
Nations. Custodial departments may adapt procedures as required
to suit local customs and conditions provided that these
procedures comply with Canadian and local standards of ethics and
environmental protection. Custodial departments are responsible
for ensuring that the necessary delegated authority is given to
managers of on-site responsibility centres.
13.
Authority to Spend Proceeds of Disposal
13.1 Proceeds from all sales of surplus Crown assets are
payable to the Receiver General for Canada and are to be
deposited in the Consolidated Revenue Fund. Departments have the
authority to spend an amount equivalent to the net proceeds of
these sales (i.e. gross proceeds, less selling fees and direct
expenses incurred by the contractor and/or PWGSC). Amounts
received may be applied to disposal, operating and capital
expenditures only and may not be used for transfer payments. This
does not apply when the moveable asset was forfeited pursuant to
an Act of Parliament, and in this case spending authority is not
established.
14.
Revenue from Sales / Accounting Procedures
14.1 The Surplus Crown Assets Act provides that an
amount equivalent to the proceeds from the sale of surplus assets
may, subject to such terms and conditions as the Treasury Board
may prescribe, be paid out of the Consolidated Revenue Fund (CRF)
for the purposes of the selling department. This is not a
vote-netting authority. The revenue from the disposal must be
deposited in the CRF as non-tax revenue to the department.
Expenditures against the authority created by the deposit of the
proceeds will be made from the CRF and be reported by the
department as expenditures against statutory authority in the
Public Accounts. (Refer to the Surplus Crown Assets Act,
1992; Sections 3, 14 and 15.) The following accounting procedures
will apply:
14.1.1 The Receiver General will establish within the accounts
of Canada two accounts for each department or agency. One
account, Proceeds from Disposal of Surplus Crown Assets, will be
a non-tax revenue account used to track the yearly revenue from
disposals and increase in the authority under the Surplus Crown
Assets Act. The account number will be made known to the
department. The second account, Spending of Proceeds from
Disposal of Surplus Crown Assets, will be a budgetary expenditure
account with statutory non-lapsing authority. It will be used to
record the use of the authority under the Surplus Crown Assets
Act during the fiscal year.
14.1.2 Departments will receive proceeds from sales directly
from disposal service contractors, will reconcile these payments
against assets sold by the contractor and credit the proceeds to
the account for Proceeds from Disposal of Surplus Crown
Assets.
14.1.3 Where the costs of a disposal service exceed the
revenue from that disposal, the department will verify the
disposal contractor's invoice to confirm compliance with the
contract, and will then pay the invoice out of appropriate
departmental resources.
14.1.4 Contractors will provide PWGSC with an information copy
of any transaction records submitted to custodians that PWGSC
requires to verify compliance with contracts.
14.1.5 Departments will draw from the account for Proceeds
from Disposal of Surplus Crown Assets for requirements and record
these withdrawals in the account for Spending of Proceeds from
Disposal of Surplus Crown Assets.
14.1.6 Departments will decide who is authorized to make
expenditures against this authority and will establish normal
commitment and expenditure controls. Departments will track the
size of the authority and the amount used and unused during a
fiscal year. Payables at Year-End (PAYE), where appropriate, may
be set up against this authority.
14.1.7 The authority to spend an amount equivalent to the
proceeds deposited in the account for Proceeds from Disposal of
Surplus Crown Assets will carry over into the following fiscal
year, subject to Treasury Board terms and conditions.
14.2 In principle, the department and or agency must use its
spending authority under the Surplus Crown Assets Act in
the fiscal year in which the authority was generated. In the
event that the custodian has unused spending authority from the
disposal of surplus Crown assets at the end of the fiscal year,
that authority will be carried forward to be used in the
subsequent fiscal year only.
14.3 Questions regarding these accounting procedures should be
directed as follows:
Policy and Cash Management:
Cash Management Division
Treasury Board of Canada Secretariat
Accounts of Canada:
Central Accounting and Reporting Directorate
Receiver General for Canada
|