Frequently Asked Questions About the Annual Financial Report

What is the Annual Financial Report?

The Annual Financial Report (AFR) provides an overview of the Government’s financial results for the fiscal year ended March 31, 2015.

The AFR also includes condensed consolidated financial statements of the Government and the audit opinion of the Auditor General of Canada.

The complete consolidated financial statements are available on the Public Works and Government Services Canada website.

What are the highlights of this year’s AFR?

The following are the highlights:

  • The AFR shows a budgetary surplus of $1.9 billion for 2014–15, compared to the $5.2-billion deficit recorded in 2013–14.
  • Revenues increased by $10.7 billion, or 3.9 per cent, from 2013–14, reflecting increases across all major revenue streams. Program expenses increased by $5.2 billion, or 2.1 per cent, reflecting increases in major transfers to persons and other levels of government, offset in part by a decrease in direct program expenses.
  • Canada’s total government net debt-to-GDP (gross domestic product) ratio stood at 40.4 per cent in 2014—the lowest in the Group of Seven (G-7).

What is the difference between the federal debt (accumulated deficit) and total government net debt, as reported by the Organisation for Economic Co-Operation and Development (OECD)?

The federal debt (accumulated deficit) is the federal government’s main measure of debt. It is equal to the Government’s total liabilities less total assets, measured on a Public Accounts basis.

Net debt is the difference between total liabilities and financial assets. International comparisons of net debt, such as those published by the OECD, are made on a total government, National Accounts basis, which for Canada includes the net debt of the federal, provincial/territorial and local governments, as well as the net assets in the Canada Pension Plan and Québec Pension Plan.

Further information on these debt measures can be found in the annex of the AFR.

How does our debt level compare with other developed countries?

Canada’s debt level compares very well with other G-7 economies.

Canada’s total government net debt-to-GDP ratio, as reported by the independent OECD, stood at 40.4 per cent in 2014.

This is the lowest level among G-7 countries, and less than half the G-7 average, which the OECD expects will be 86.8 per cent of GDP in the same year.

This measure of debt includes the net debt of the federal, provincial/territorial and local governments, as well as the net assets held in the Canada Pension Plan and Québec Pension Plan.