The OFA manages the Province’s debt and investments and recovers its costs for these services. The OFA also provides treasury and administrative services to other Crown agencies and recovers its costs on a fee-for-service basis.

The OFA’s income from operations for the year ended March 31, 2004, was $4,000 (March 31, 2003 – $3,000). Net capital assets of the OFA as of March 31, 2004, were $1.9 million, representing a balance as of March 31, 2003, of $1.0 million, plus purchases, including leasehold improvements, of $1.7 million and less amortization of $0.8 million. Retained earnings of OFA of $40,000 (since inception) represent notional amounts. Annually, the OFA’s financial results are consolidated on a line-by-line basis with those of the Province. This accounting treatment is in accordance with the Public Sector Accounting Board (PSAB) of the Canadian Institute of Chartered Accountants (CICA), under which the OFA is considered a government organization.

As an intermediary for the Province, the OFA made loans to public bodies, the repayment of which is to be funded through third-party revenues. The outstanding balance of these loans, as of March 31, 2004, was $131 million, a net increase of $76 million (from the $55 million reported a year ago) as reported in Note 4(i) of the financial statements. The increase is mainly due to a loan made to assist the Toronto District School Board of $55.2 million and to the Ontario Northland Transportation Commission (ONTC) of $24 million on their lines of credit.

The OFA continued to provide investment management services to other public bodies such as the Ontario Realty Corporation, the Ontario Trillium Foundation, etc. As of March 31, 2004, the OFA managed investments totalling $428 million (March 31, 2003 – $452 million), on behalf of those entities as reported in Note 4(ii) of the financial statements.

The OFA also administers the loans receivable and payable of the former Ontario Municipal Improvement Corporation (OMIC). OMIC assets of $79 million consist of debentures receivable from various municipalities and school boards. An equal amount of liabilities are payable to Canada Pension Plan (CPP) and the Province. The majority of loan repayments will occur in the fiscal years ended March 31, 2012-13. The interest earned and paid annually on account of OMIC assets and liabilities amounts to $7.6 million and is expected to remain at this level until CPP loans start maturing.

During the year, the Ontario Electricity Restructuring Secretariat was transferred to the OFA forming the Corporate and Electricity Finance Division to better integrate the financial analysis, operational responsibilities and due diligence on behalf of the Province related to the electricity industry. Starting in fiscal 2004-05, operating costs for the Electricity Finance Branch will be part of OFA; for fiscal 2003-04 the costs remained with the Ministry of Finance.

The Province of Ontario Savings Office (POSO) was sold to Desjardins Credit Union (DCU) and pursuant to the Sale Agreement, the sale closed on March 31, 2003. As shown in Note 7(ii), the Province received additional sale revenue of approximately $3 million as per the sale agreement and paid $9 million, including interest, to DCU resulting from an understatement of the initial assets transferred from the Province to DCU. The OFA staff continue to manage post-sale activities, including legal requirements and liaise with former POSO clients to ensure that the needs of former POSO account holders are adequately met.