7. Object Codes

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7.1 Introduction

7.1.1 Policy

Government-wide object classification

Departmental objects must be related to the government-wide objects in the classification (Master Lists) prescribed by the Treasury Board.

The government-wide object classification is included in the Master Lists of Objects included in Section 7.2 of this chapter.

Internal transactions

To determine and report more accurately the impact of government revenues and expenditures on the rest of the economy, the net amount of government purchases and sales by standard object must be determined.

1. All departments, including those that use revolving funds, must charge their expenditures for purchases from outside the government to standard objects 01 to 12. Similarly, sales to entities outside the government will be credited to standard objects 13 or 14.
2. All expenditures relative to purchases from other departments or from within a department are charged to standard object 15.
3. All revenues from sales to other departments or within a department are credited to standard object 16.

An elaboration of this policy is included in Section 7.4 of this chapter.

7.1.2 Introduction

The object classification system identifies the type of resources acquired or disbursed. The classification is coded at the time of the initial transaction, and identifies

• in the case of expenditure, the types of goods or services acquired or the transfer payments made;
• in the case of revenue, the source of the receipts;
• in the case of other-than-budgetary transactions, the causes of the increases or decreases to financial claims and obligations.

The resulting information provides a standardized classification system for various levels of management in departments, for economic analysis on a government-wide basis, and for central agency management purposes.

Since the object coding system was first introduced, its use has expanded so that it now provides a repository of government-wide information which can be used by central agencies and others without requiring departments and agencies to respond to numerous individual requests.

With the above information the central repository provides:

• A system for classifying and coding transactions to report information to Parliament in the Estimates and the Public Accounts about the nature of the transactions.
• A standard sub-classification of transactions for internal analysis and central management purposes. This promotes consistency in information available to central agencies.
• Uniform information to statistical agencies for economic analysis purposes. This information is consolidated by Statistics Canada with equivalent data from other sectors of the economy to compile the National Accounts and other statistical information.
• The basis for the self-assessment tax system which has been used by the federal government to determine and assess provincial retail sales, consumption and use taxes under the Reciprocal Taxation Agreements and to make payment of taxes to the participating provinces. These payments, which have been based on departmental and agency expenditures, are made to the provinces centrally by the Transitional Taxation Branch/ITC of Supply and Services Canada. Without a central data bank, departments would be required to incur the cost of establishing and maintaining the necessary administrative structures to support this program.

7.1.3 Object Classification Levels

To accommodate the need for differing degrees of detail, several levels of classification by object are used. In descending order of aggregation, they are: categories, sub-categories, standard objects; reporting objects, sub-reporting objects; economic, source and class objects; and departmental (line) objects. (See chart on page 7 and Section 7.1.4 for further details.)

Categories

Categorie, are the highest levels of object aggregation. As a result of the expanding requirements for object analysis information, economic and source objects are being re-numbered into their category and sub-category sequence over the next few fiscal years. This will provide more flexibility for the numbering system and make it less dependent on the standard objects currently in use.

There are ten categories in the Master Lists of Objects-four for expenditures, two for revenue and four for financial claims and obligations. (See Section 7.1.4 a for detailed explanation.)

Sub-categories

Sub-categories are a primary breakdown of each category. In many cases, they are the same as standard objects.

Standard Objects

Standard objects are the highest levels of object classification used for Parliamentary and executive purposes, and are reported in the Estimates and the Public Accounts.

Reporting Object

Reporting objects are a sub-division of standard objects which are used for central management purposes.

Sub-reporting Objects

Sub-reporting objects are a secondary breakdown for reporting objects under certain standard objects; they are used for structural purposes only.

Economic, Source and Class Objects

Economic, source and class objects are the lowest levels of object classification used for government-wide reporting purposes. Each of these objects is used for separate types of transaction:

Economic Objects

Economic objects apply to budgetary expenditures only. To measure the impact of government transactions on the economy, expenditures are classified according to the type of resources (goods and services) acquired or the transfer payments made.

Identification of detailed economic objects, combined with information from other sectors of the economy, makes possible economic analysis, on a national basis, of the effects of government spending. This classification is linked to Statistics Canada's Standard Commodity Classification which is used by other levels of government and other sectors of the economy. The economic objects required for government-wide statistical purposes may be used by departments as departmental line objects. As most departments or agencies require more detail, transactions may be classified by departmental line object in the departmental system provided that they can be related to the relevant economic objects.

7.1.3.1 Chart of Object Classification Levels

Note: See 7.2.0 for explanation on the structure of the Master Lists of Objects

Source Objects

Source objects identify the origin of a receipt and apply to budgetary revenue excluding tax revenue. However, tax revenue source objects now exist to cover the Goods and Services Tax (GST) revenue and for internal transactions. Other than tax revenue, the principal categories of revenue are:

• non-tax revenue, other than revenue credited to votes; and
• revenues credited to votes, which include revenues of revolving funds.

Class Objects

Class objects identify the causes of increases or decreases to financial claims or obligations. The class objects relate to four types of non-budgetary transactions.

• financial claims (assets);
• financial obligations (liabilities);
• other transactions, such as those for the Allowances, or for unamortized amounts;
• accumulated deficit, which includes any transactions that are consolidated as budgetary for summary reporting purposes.

Departmental Line Objects

Departmental line objects (which are also referred to as "resource codes" or "departmental objects") are used for detailed classification for departmental purposes. To permit the consolidation and comparison of information from all departments, line objects must be aligned with the objects prescribed in Section 7.2. Once transactions are classified by line object, the Central Accounting System can impose an economic, source or class object as applicable and then automatically summarize at the reporting object and standard object levels. For all transactions, economic, source or class objects must relate to line objects on a one-to-one or a one-to-many basis, unless the estimated annual amount related to an economic object is less than $1,000. In that case the amount should be related to the "Other (specify)" economic object under the same reporting (or sub-reporting) object.

7.1.4 Relationship of Categories to Standard Objects

The categories and sub-categories, as well as the related standard objects included in the Master Lists are listed in Appendix A. A list of the 16 standard objects is included at the beginning of Section 7.2.

Objects of Expenditure

Objects of expenditure comprise 4 categories-Services, Goods, Transfer Payments and Other Expenditures. The allocation by category and sub-category of the standard objects is as follows:

Services are covered by six standard objects-one (standard object 01) for personnel services, and five (standard objects 02 to 06) for all other services. No sub-categories exist for Services.

Goods are covered by three standard objects-one (standard object 07) for non-capital expenditures and two (standard objects 08 and 09) for capital expenditures. No sub-categories exist for Goods.

Transfer Payments are all covered by standard object 10. In the revised system, Transfer Payments have been split into four sub-categories (20 to 23), each sub-category representing payments to a particular sector of the economy or to related sectors.

The other two standard objects are included under Other Expenditures, those being:

• Service of the Public Debt (standard object 11; sub-category 31),
• Other subsidies and payments (standard object 12)-this has been split into two sub-categories (25 and 32) to separate Transfers to Crown Corporations from Miscellaneous expenditures,
• Internal transactions for expenditures (standard object 15) are explained below.

Revenue Source Objects

The object coding system also requires that all revenues other than tax revenues be reported by standard, reporting, and source objects. These revenues are divided by standard object into those that are credited to votes (standard object 13) and non-tax revenues, which are credited to general revenues (standard object 14). Because revenues that fall under the same classification may be treated as a credit to a vote under one set of circumstances and as general non-tax revenue under another set of circumstances, the last three digits of the equivalent revenue source objects are to the extent possible the same for standard objects 13 and 14.

In the revised numbering system, the two standard objects are, however, included under separate categories because Revenues Credited to the Vote (sub-category 35) are netted against budgetary expenditures, and not included as revenue, while revenues in sub-categories 45 and 47 are included as non-tax revenue.

Internal transactions for revenues (standard object 16) are explained below.

Other than transactions related to the Goods and Services Tax or for internal transactions, transactions pertaining to tax revenues continue to be excluded from economic analysis until further notice.

Other Transactions (Class Objects)

The object coding system includes class objects for other-than-budgetary transactions, including certain amounts that are consolidated as budgetary transactions for reporting purposes. These objects provide information so the reasons for the increases or decreases to the balances of financial claims and obligations can be analysed. They are split into 4 categories-Financial Claims, Financial Obligations, Other transactions, and the Accumulated Deficit. At the standard object or sub-category level (which are synonymous for these transactions), four pertain to financial claims, five pertain to financial obligations, and one covers all other non-budgetary transactions.

Concerning the six sub-categories that cover the Accumulated Deficit, five include transactions that are consolidated to either the budgetary deficit or to assets or liabilities for reporting purposes, while the other pertains to unrestricted amounts in the Accumulated Deficit. The gross and consolidated standard objects for these sub-categories are shown on page 2 of Appendix A.

Internal Transactions

To identify internal transactions and eliminate the double counting of revenues and expenditures for government-wide reporting purposes, standard objects 15 and 16 identify expenditure and revenue transactions which are internal to the government. The elimination of these transactions results in more accurate government-wide information by standard and economic object. Standard object 15 includes sub-categories 33 and 34 under expenditures, while standard object 16 for revenues includes sub-categories 36 and 37 (which are netted to expenditures), as well as 46. Standard objects 15 and 16 apply for government-wide reporting on a "net basis" only. For gross reporting purposes, all their transactions can be related back to standard objects 01 to 14.

A table showing the relationship between sub-categories, and the gross and net standard objects is included in page 1 of Appendix A.

7.1.5 Object Numbering System

In the numbering system introduced for standard and economic objects in 1966, the first 2 digits of the economic object were the standard object. By 1986, more than 100 economic objects were required in some standard objects, and therefore a new numbering system was required.

The revised numbering system no longer contains the standard object as the first two digits of the economic/source object code. Instead, the first digit is the category, the first two digits are the sub-category and, to the extent possible, the first 3 digits are the reporting object. A summary of the new numbering system is included in Appendix A.

Since 1986 economic and source objects within standard objects 10 to 14 have been re-numbered as the first part of the introduction of the revised numbering system. The economic objects within standard objects 01 to 09 will be re-numbered at some future date. The relationship of economic/source objects to standard objects continues, however, as prescribed in the Master Lists.

7.1.6 Maintenance of Object Coding System

Master Lists of Objects

The objects which are to be recorded by the Receiver General for expenditures, non-tax revenue, and financial claims and obligations are listed in the Master Lists of Objects in Section 7.2 of this chapter. By November of each year, the Office of the Comptroller General advises departments of any changes to the Master Lists of Objects. Departments must then forward the following information to the Receiver General for each pertinent economic, source or class object using the form needed for changes to the Central Accounting System:

• the code number of each line object;
• the description of each line object; and
• the corresponding economic, source or class object.

It may be impractical for some departments to break down transactions to the full extent called for by the objects in the Master Lists. The use of data broken down into those objects is broad enough to permit relaxation of the principle of a one-to-one or many-to-one relationship between line objects and the economic, source or class objects, when the amounts are insignificant for either one transaction or the total. In such cases, for each line object, departments must provide an estimated percentage breakdown by the object in the Master List. The Receiver General will then be able to take the totals accumulated by line object and apportion them by objects in the Master Lists.

Several objects have the word "specify" in brackets as part of their description. For these objects, departments shall specify the nature of the transactions in the line objects aligned to those objects, avoiding where possible the word "miscellaneous" or "other". Unless otherwise indicated in the individual reporting or economic object, the nature of the transaction shall be specified in line objects, when the total estimated annual expenditures of any line objects to be charged to such an object are likely to exceed the following limits:

The Government Operational Services sector of Supply and Services Canada, the operator of the central repository, can then provide central agencies and other users with a list of the departmental line objects and the amounts included under those objects. This avoids creating additional objects that may apply to only one or two departments, or requesting departments to allocate relatively insignificant amounts to several objects within the reporting of sub-reporting objects.

List of Pay Entitlement Codes

In 1986, the List of Pay Entitlement Codes was issued to departments to improve consistency and accuracy in the alignment of pay entitlement codes to economic objects mainly in standard object 01. A pay entitlement code classifies the type of remuneration paid to employees pursuant to a collective bargaining agreement, the terms and conditions of employment, or other arrangements. These codes are issued to departments and agencies by Supply and Services Canada. The pay entitlement codes are listed with the Master Lists of Objects to facilitate the update of the computer dictionaries. As new pay entitlement codes are issued during the year, departments will align them with the appropriate economic objects until the next Master Lists are issued.

The List of Pay Entitlement Codes is now revised annually by November of each year at the same time as the Master Lists of Objects. It is included as Appendix A to Section 7.2 of this chapter.

List of Descriptions

Interpretation and analysis of financial information require the classification and coding of transactions to be correctly and consistently applied.

To help departments and agencies improve accuracy and consistency in the coding of their financial transactions, a List of Descriptions for Objects was first issued in 1984. The list has been amended annually to include all objects whose descriptions have been revised in the Master Lists of Objects.

The list includes descriptions for all economic objects in standard objects 01 to 06, and 10 to 12. For standard objects 07 to 09, some descriptions are included. The remaining descriptions will be issued as the re-numbering of economic objects is completed over the next few years. Descriptions for all source objects and class objects are also included in the List of Descriptions.

To maximize the use of the List of Descriptions, departments should review it carefully to ensure that the alignment of their line objects to economic, source and class objects is correct. Where applicable, a copy of the relevant descriptions should also be made available to departmental personnel involved in coding to help ensure consistent coding and reporting, both within the department and within the government as a whole.

The List of Descriptions is included in Section 7.3 of this chapter.

7.1.7 Identification of Internal Transactions

To determine and report more accurately the impact of government revenues and expenditures on the rest of the economy, the net amount of government purchases and sales by standard object must be determined. In 1987, standard objects 15 and 16 were introduced to identify these expenditure and revenue transactions, so they could be eliminated to provide more accurate government-wide information by standard and reporting object. To identify these transactions properly:

1. All departments, including those that use revolving funds, must charge their expenditures for purchases from outside the government to standard objects 01 to 12. Similarly, sales to entities outside the government will be credited to standard objects 13 or 14.
2. All expenditures relative to purchases from other departments or from within a department are charged to standard object 15. This includes instances where departments reallocate costs internally.
3. All revenues from sales to other departments or within a department are credited to standard object 16. This includes instances where departments reallocate revenues, and includes credits resulting from the reallocation of costs.

On a government-wide basis, the expenditures charged in standard object 15 should agree with the revenues credited in standard object 16. By identifying the transactions in standard objects 15 and 16, the net amount of government budgetary revenues and expenditures can be determined by eliminating the amounts in these standard objects. The reports containing government-wide summary information include the interim and audited financial statements.

7.1.8 Roles and Responsibilities

Office of the Comptroller General

The Office of the Comptroller General (OCG) is responsible for providing policy advice and interpretation, implementation assistance including appropriate training/information sessions for departments, and for promulgating any changes required to the Chart of Accounts for the Government of Canada.

Receiver General

The Receiver General is responsible for providing any supporting operational instructions, such as Receiver General Directives, functional direction and other guidance to departments and agencies. This includes a monitoring role for the overall quality of the object information.

Departmental Responsibilities

Departments have the primary responsibility for ensuring that appropriate departmental classification changes by object are made to reflect any changes to the Master Lists and for monitoring the quality of departmental coding. This includes departmental implementation of all requirements specified by the Office of the Comptroller General and the Receiver General.

7.1.9 Additional Information on Certain Objects

During the past few years, several structural changes have been made to groupings of objects and to the systems and procedures involved in producing statements for central management and economic analysis purposes. Some of the more significant features are described in Appendix B to this Section.

Appendix A Relationship of Categories to Standard Objects

Appendix B Additional Information on Certain Objects

This appendix includes additional information on some structural changes made to groupings of objects and/or to the systems and procedures involved in producing statements for central management and economic analysis purposes.

1. Allocation to Employee Benefit Plans

   Departments shall assign the amounts of the government's contribution to employee benefit plans as an employer to one departmental line object. Through the use of the Central Accounting System's percentage distribution capability, the amounts in that line object will be automatically distributed to the five economic objects concerned in standard object 01. Each year, the Receiver General will automatically revise the allocation of those amounts to reflect the amounts prescribed by the Treasury Board Secretariat.

2. Telecommunications Expenditures

   In accordance with the November 1988 report on object coding from the Telecommunications Advisory Committee, four new economic objects were established effective April 1, 1990, in standard object 02 and one each in standard objects 05 and 09 to separate telecommunications services acquired from other services providers from those acquired from common carriers, and to identify enhanced telecommunications services and digital channel communications services and equipment.

3. Expenditures on Communications

   In accordance with the March 1, 1990, report from the Privy Council Office on the Management of Communications Resources, five new economic objects were added effective April 1, 1991, in standard objects 03 (0341, 0351 and 0352) and 15 (3326 and 3327). These new objects specifically identify communications research services and communications professional services.

4. Compatibility to Statistics Canada Classifications

   In the Master Lists, some of the reporting objects within standard objects 06 to 08 inclusive are sub-divided into sub-reporting objects to bring the structures of those reporting objects in line with the classifications used by Statistics Canada in the Standard Commodity Classification (catalogue no. 12-502) and the Census on Construction (catalogue no. 64-201). To ensure that the economic objects in standard objects 06 to 09 are compatible with the Standard Commodity Classification (SCC), the SCC codes are listed, where applicable, in the Master Lists of Objects in Section 7.2.1. Through the Standard Commodity Classification (Volume I, catalogue no. 12-502) and its related Classified Index (Volume II, catalogue no. 12-515) and Alphabetical Index (Volume III, catalogue no. 12-516), departments have documentation to which they can refer in classifying their transactions.

5. Goods and Services Tax

   To record transactions related to the Goods and Services Tax (GST), sub-category 42 has been established effective January 1, 1991. Seven source objects have been included under this sub- category while two class objects for GST payments have been added under sub-category 81. Those objects were effective on January 1, 1991, when the GST was implemented.

6. Revolving Funds

   Revolving fund expenditures must be reported in accordance with the reporting requirements for standard, reporting, and economic or source objects that are used for all other budgetary appropriations. All revenues of revolving funds are to be credited to standard object 13 (Revenues Credited to the Vote) on a gross basis. However, the economic and source objects related to goods and services sold by or purchased from revolving funds and common services agencies by other departments and agencies are included in standard objects 15 and 16 in the Master Lists. These objects have been added so that they can be identified and eliminated by Supply and Services Canada when transactions are reported on a government-wide basis.

7. Interdepartmental Charges

   Effective April 1, 1990, to simplify the coding required for interdepartmental charges and recoveries, 19 economic and source objects were deleted from standard objects 15 and 16, and were replaced by two objects in standard object 15 (in gross standard object 12).

8. Reallocation of Expenditures from Internal Sources by Departments which do not have Explicit Parliamentary Authority to Net Vote

   To record the reallocation of expenditures by departments which do not have explicit parliamentary authority to net vote, a new sub-category 37 was added in standard object 16 effective April 1, 1991. Seven new source objects, previously in sub- category 36, have now been included under reporting object 371 in sub-category 37. On a gross reporting basis, these source objects and reporting object 371 are included as credits in standard object 12.

9. Identification of Amounts Consolidated for Reporting Purposes

   In the Master List of Objects presented in Section 7.2.3, the transactions in the class objects under sub-categories 81 to 85 meet the following separate reporting requirements:

   • the need to record the transactions as non-budgetary to meet the legal requirements of the enabling legislation or for other purposes; and
   • the need to consolidate these amounts for reporting purposes in the government's summary financial statements and reports, either as budgetary revenue and expenditures or as financial claims or obligations.

   To enable central agencies to obtain data on consolidated accounts and the Receiver General to produce reports on a consolidated basis, a separate column has been included in the Master List of Objects (in Section 7.2.3.4) to show the consolidated standard objects to which each of the relevant class objects in sub-Categories 81 to 85 pertains. This will have no impact on departmental line objects or on the class objects, but will provide additional information for those requiring it on a government-wide basis for reporting or other purposes. To enable the consolidated transactions related to loans, investments and advances to be eliminated, some new class objects were added in sub-category 50.

10. Consolidation of Appropriation Dependent Crown Corporations

    To consolidate transactions related to appropriation-dependent Crown corporations and to record accounts receivable and the related non-tax review at year-end, three new sub-categories 83, 84, and 85 and 52 new class objects were added on April 1, 1991. Most of these codes will be used by the Receiver General only.

11. Asset Objects

    Departments involved in construction and repairs using their own resources (e.g., labour and materiel) should include a field designated as "asset object" at the end of the departmental input coding block. The actual goods or services used is then coded in the line object field, while the type of asset affected is recorded by coding the last three digits of the corresponding economic object in the asset object field. This data is required by Statistics Canada to show capital formation in the National Accounts.

12. Coding of purchases Procured by Using Acquisition Cards

    In accordance with Chapter 9 of Part 3 of the Financial Management Component of the T.B. Manual, departments are being encouraged to use acquisition cards for the procurement and payment of low value purchases as a method of increasing efficiency. To accommodate this policy, for purchases acquired by acquisition cards, departments should code the total of all individual transactions under $100.00 to the Other (Specify) economic objects within each sub-reporting object.

    e.g. within standard object 07, departments should use:

    • economic object 0758 for coding all Personal and Household Goods (such as clothing, furnishings, cleaning supplies, etc.)
    • economic object 0766 for all Miscellaneous Goods (such as printed matter, stationery, office supplies and medical supplies, etc.)
13. Recognition of Capital Expenditures

    For many years, a dollar limit has been used to determine whether goods are capital or non-capital. Machinery and equipment which are capital are recorded in standard object 09, while machinery and equipment which are not capital are included as Parts, Consumable Tools and Small Equipment in standard object 07 (economic objects 0778 to 0797).

    Effective April 1, 1992 for fiscal year 1992-93, and subsequent years all expenditures over $1,000 on these goods are to be recognised as capital and included in standard object 09. Amounts below $1,000 are to be included as operating expenditures and recorded in standard object 07.

7.2 Codes

Objects of Expenditure
0	Services
1	Goods
2	Tranfer Payments (Standard Object 10)
3	Other Expenditures
3A	Expenditures from Internal Sources or for Accounting Purposes
Objects for Revenue
4	Revenues Credited to the Vote (former Standard Object 13)
4A	Non-Tax Revenue
Objects for Assets, Liabilities and Other Transactions
5	Assets
6	Liabilities
7	Other
8	Accumulated Deficit
9	Identification of Partnering Department for Interdepartmental Settlement Transactions

Appendix A - Release Notes

Click here for the Release Notes.

Appendix B - Endnotes

Click here for the Endnotes.

Appendix C - List of Pay Entitlement Codes

Click here for the List of Pay Entitlement Codes.