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During on this detailed description amplify making bc a great place for technology entrepreneurs.
BC Innovation
Council
Annual Report
2012 | 2013
Making BC a great
place for technology
entrepreneurs
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BC Innovation Council.
Annual service plan report. — 2012/13 —
Annual.
Continues: Innovation and Science Council of British Columbia.
Annual service plan report.
ISSN 1718-2654 = Annual service plan report (BC Innovation Council)
Also available on the Internet.
1. BC Innovation Council - Periodicals.
2. Science and state - British Columbia - Periodicals.
3. Technology and state - British Columbia - Periodicals.
I. Title.
II. Title: BC Innovation Council…annual service plan report.
HC117.B74 354.2’745 C2006-960002-3
BC Innovation Council Annual Report 2012 | 2013 3
Message from the Chair
Jill Leversage,
Chair, BC Innovation Council
On behalf of the Board of Directors and the employees of BCIC, I am pleased to present our Annual Service Plan
Report for the fiscal year 2012/2013.
BCIC remained in a strong financial position at the end of fiscal 2012/2013, having unrestricted assets of $6.3 million.
Along with the funding it received from the Ministry of Advanced Education, Innovation and Technology, BCIC continued
to partner with federal and provincial government agencies, research institutions, industry and regional groups to carry
out programs and initiatives that align with our mandate.
BCIC is the Province’s lead agency with a mandate to grow British Columbia’s economy and create new rewarding
technology jobs by supporting technology entrepreneurs and accelerating technology commercialization. Working with
its network of partners across the province, BCIC funds and supports programs that advance new technology ventures
through well-defined stages to propel innovative new products beyond the idea stage into the global marketplace.
In 2012/2013, BCIC contributed a total of $6.6 million to community activities, including the launch of Venture
Acceleration Programs across the province, and the support of community events such as the Startup Canada
Campaign, the GROW technology conference and a technology summit. This total is in line with the forecast set out
in our 2012/2013 Service Plan.
In addition, BCIC met or exceeded all the targets set for our measures, a direct result of BCIC and partner efforts to
expand successful Venture Acceleration Programs across the province in the BCIC Acceleration Network. Partners such
as the Victoria Advanced Technology Council (VIATeC) and Northwest Science & Innovation retained business experts to
work with clients and greatly exceeded the targets they set for the year.
In 2012/2013, BCIC continued to work closely with its partners in industry and academia to deliver programs and
initiatives that develop entrepreneurial talent and promote the commercialization of technology.
In particular:
• Launched in September 2012, the largest BCIC commercialization initiative is BCAN, the BCIC Acceleration
Network. BCAN touches all corners of the province through regional partners funded by BCIC. The objective is to
deliver support to allow early-stage entrepreneurs to get their businesses launched. As part of BCAN, BCIC’s regional
partners deliver the Venture Acceleration Programs, which provide office space and a supportive environment for new
entrepreneurs. Executives-in-Residence, successful business professionals trained in the use of the program, help
new entrepreneurs through the earliest stages of their enrolment. In addition, the BCIC Mentor Program provides
ongoing mentoring through its volunteer mentors, providing assistance as the companies develop.
BC Innovation Council Annual Report 2012 | 2013 4
Message from the Chair (continued)
At the time of the launch, two partners had entered the Network and the program was available in the Okanagan and
Victoria. Since September, BCIC has secured additional partners in order to expand the program offerings throughout
the Lower Mainland, Fraser Valley, mid- and north- Vancouver Island, Sunshine Coast and the Central Interior.
• In partnership with Mitacs, a national not-for-profit research organization that develops the next generation of
innovators with vital scientific and business skills, BCIC launched the BCIC-Mitacs Commercialization Voucher
Program in 2012/2013.
A pilot program was designed to help British Columbia businesses rapidly bring their ideas and products to market.
The program enables companies to retain a graduate student from a British Columbia-based Post-Secondary
Research Institution for commercialization assessments of new products or services, or new market opportunities
for existing products or services.
Over the past 12 months, BCIC welcomed new team members to help BCIC execute on its mission. As of July 1, 2012, the
BCIC Board of Directors has been strengthened by the appointment of two members, Lorraine Larkin and Derek Lew. In
August, John Jacobson joined the team as President and CEO and made a valuable contribution during the remainder of
the fiscal year.
In 2012, BCIC transitioned its goals, measures and targets to reflect the recommendations from the Province’s 2011
Mandate Review of BCIC. The planning phase took place in 2012, and changes are underway for implementation in
the next fiscal year. BCIC’s refreshed mandate extends its activities into eight key industry sectors identified in the BC
Jobs Plan. BCIC is developing a Cross-Sector Strategy in 2013/2014 as a first step in broadening our focus to all eight
sectors.
In addition, the renewed mandate directed BCIC to change its funding process to improve transparency and
accountability. New program spending will be based on specific work plans developed and proposed by the funded
organization and will include appropriate measures of progress and outcomes. As a result, funding that BCIC
previously provided to some of its partners has ended and is being replaced with contribution agreements that outline
expectations.
Greater detail of BCIC’s activities over the past fiscal year can be found in the following pages of this 2012/2013 Annual
Service Plan Report.
Through leveraging of funds, knowledge and industry expertise, BCIC strives to maximize the value of every dollar spent.
BCIC’s existing resources are fully committed to Board-approved programs and initiatives. We are confident that the
dollars invested in programs for entrepreneurs in British Columbia will continue to yield results and, in turn, create more
job opportunities.
I would like to thank Ministry personnel for their strong support. I look forward to our continued conversations and
collaborations as we work towards building the best economic opportunities for British Columbians and strengthening
BCIC’s role in growing our economy.
Yours truly,
Jill Leversage
Chair, BCIC
June 5, 2013
BC Innovation Council Annual Report 2012 | 2013 5
The 2012/2013 BC Innovation Council Annual Service
Plan Report was prepared under the Board’s direction
in accordance with the Budget Transparency and
Accountability Act. The Board is accountable for the
contents of the report.
The information presented has been prepared in
accordance with the BC Reporting Principles and reflects
the actual performance of BCIC for the 12 months
ending March 31, 2013. The measures presented for
2012/2013 focus on aspects critical to the organization’s
performance and are consistent with BCIC’s mission,
goals and objectives in 2012/2013. The Board is
responsible for ensuring internal controls are in place
to confirm that performance information is measured
accurately and in a timely fashion.
All significant decisions, events and identified risks as of
March 31, 2013, have been considered in preparing the
report. The report contains estimates and interpretive
information that represent the best judgment of
management. Its contents are consistent with the
Government’s Letter of Expectations received from the
Province in 2012.
Any changes in mandate direction, goals, strategies,
measures or targets made since the 2012/13 – 2014/15
service plan were published in the 2013/2014 service
plan and any significant limitations in the reliability of
data are identified in the report.
Jill Leversage
Chair, BCIC
June 5, 2013
Accountability Statement
BC Innovation Council Annual Report 2012 | 2013 6
Message from the Chair 2
Accountability Statement 4
Organizational Overview 6
Enabling Legislation 6
Mandate 6
Vision 6
Mission 6
Values 7
Overview of Core Business Areas 8
BCIC Programs 8
Program Area: Entrepreneurial Talent Development and Retention 8
Program Area: Commercialization of Technology 9
Program Area: Technology Awareness 10
Benefits for British Columbians 11
Principal Partners, Clients and Stakeholders, Delivery of Services 12
Location 13
Corporate Governance 14
Role and Membership of the Board 14
The Board 14
Board Committees 15
Senior Management Team 15
Governance Principles 15
Governance Disclosure and Key Accountability Relationships 15
Report on Performance 16
Goals, Objectives, Key Strategies, Measures and Targets 16
Goal 1: Entrepreneurial Talent Development and Retention 17
Goal 2: Commercializing Innovative Technology 20
Goal 3: Increase Awareness of BC’s Knowledge Economy 22
Benchmarking 24
Management’s Confidence in Data Integrity 25
Opportunities and Challenges 25
Risk and Capacity Issues 25
Letter of Expectations and Letters of Direction From Government 26
Financial Report 32
Future Outlook 36
Statement of Management Responsibility 37
Signed Auditor’s Report 38
Financial Statements: BC Innovation Council 39
Notes to Financial Statements for BC Innovation Council 44
Appendix A: Startup Growth Components 54
Table of Contents
BC Innovation Council Annual Report 2012 | 2013 7
Enabling Legislation
The BC Innovation Council is a provincial Crown Agency
operating under the British Columbia Innovation Council
Act (Amended in Bill 15 - 2006).
Mandate
The provincial government has provided the following
direction to BCIC in order to ensure it fulfills its objectives:
• To advance commercialization in British Columbia
through focused support to startup companies and
facilitation of partnerships between industry and
academia;
• To work with partners and organizations that
support entrepreneurship and the development of
entrepreneurial talent;
• To work cooperatively with the BC Regional Science
and Technology Network (BCRSTN) offices and the
University Industry Liaison Offices (UILOs) operating in
the province;
• Incubate and develop key programs in partnership
with the Government and deliver programs through
well-established partners that use outcomes-based
reporting and transparent practices;
• Align BCIC’s Board governance model with the Board
Resourcing and Development Office (BRDO) policies
and best practices;
• Develop a new set of outcome-based performance
measures as part of a rigorous approach to planning
and evaluation, and extend these metrics to partner
selection and reporting;
• Diversify programming to expand entrepreneurship
programs and support in priority sectors as outlined in
the BC Jobs Plan; and
• Meet the financial and performance reporting
requirements set out in the Budget Transparency and
Accountability Act, the Financial Administration Act,
and the Financial Information Act.
Vision
Making British Columbia a great place for technology
entrepreneurs to access opportunities, training and
community.
Mission
BCIC accelerates the commercialization of technology
by funding venture acceleration programs that promote
and assist development of entrepreneurs and early stage
companies.
Organizational Overview
BC Innovation Council Annual Report 2012 | 2013 8
Values
BCIC’s core values guide its operations. They include:
• Collaboration – BCIC collaborates with partners to
create programs and provide support for initiatives
that develop entrepreneurs and promote the
commercialization of technology.
• Results – BCIC measures the contribution that our
programs and activities make to the province by
setting performance targets and measuring results.
We continually monitor our programs and services
with our partners and clients to ensure outcomes are
aligned with our mandate.
• Integrity – BCIC is committed to meeting the highest
standard of integrity expected by British Columbians
and Government alike. We follow fair and transparent
processes in all our activities and we pass the
obligation to do the same to all of the partners we
provide funding to.
• Entrepreneurial – BCIC promotes an entrepreneurial
spirit among those starting ventures in British
Columbia, and BCIC is committed to operating with the
same entrepreneurial spirit.
Organizational Overview (continued)
BC Innovation Council Annual Report 2012 | 2013 9
BCIC is the Province’s lead organization with a mandate
to encourage commercialization of technology in
British Columbia. Helping entrepreneurs get new and
innovative products into the global market enhances
British Columbia’s competitiveness and provides high
quality jobs for British Columbians. New companies and
ventures are the engine of job creation and the origin of
the future firms that anchor the economy. All of BCIC’s
programs and services support this important goal.
BCIC develops and funds programs which are delivered
across the province by regional economic development
organizations and academic institutions. This approach
enables BCIC to assure quality and consistency while
catering to the specific needs of technology entrepreneurs
based on their location, their industry sector and the stage
of development of their venture, be it the concept, idea
validation, pre-commercial or startup stage.
BCIC’s programs focus on economic sectors in which
British Columbia has a competitive advantage.
BCIC Programs
In 2012/2013, BCIC delivered initiatives under three
program areas to meet its mandate. The program areas
are as follows:
• Entrepreneurial Talent Development and Retention
• Commercialization of Technology
• Technology Awareness
Program Area: Entrepreneurial
Talent Development and
Retention
BCIC works with its program partners to help British
Columbians become successful entrepreneurs who
will build their companies in the province. BCIC funds
several programs that provide training to emerging
entrepreneurs as well early-stage entrepreneurs who are
working to commercialize their concepts. For example:
• entrepreneurship@SFU: created by BCIC, Dr. Ken
Spencer, SFU’s Faculty of Applied Sciences and the
Beedie School of Business in 2012. This initiative
provides a competitive academic pathway for third-
and fourth-year business and applied sciences
students and provides the skills, mentorship and
resources to build upon innovative ideas and develop
successful new ventures. Students are expected
to produce a business plan, design and prototype
their product/system, complete steps to launch a
successful business and obtain a lead customer.
They also take courses in business, engineering,
entrepreneurship, innovation and commercialization
and have access to mentorship from industry experts,
a scholarship award and other resources.
Key Achievements: Launched in January 2012,
the first two years of the program have placed 31
students in six teams that created business plans
and prototypes, and worked toward securing lead
customers, partners and investors as part of the
future launch of their companies.
Overview of Core Business Areas
Daniel Shapiro,
Dean, Beedie School of Business,
Simon Fraser University,
addresses attendees at the
entrepreneurship@SFU launch
BC Innovation Council Annual Report 2012 | 2013 10
• entrepreneurship@UVic: developed in 2009 by BCIC
in partnership with the University of Victoria, Wesley
Clover and the Alacrity Foundation, with support
from Western Economic Diversification Canada. This
incubator program offers engineering graduates
specialized entrepreneurship training, guidance and
mentorship from successful technology developers and
investors. Upon completion of the program students
receive Master’s degrees, entrepreneurship graduate
diplomas, and have developed their own companies.
Key Achievements: In the three academic years since
its launch in 2009, the program has trained a total of
10 students. Each cohort has created a company, for
a total of three companies. The first cohort graduated
in 2011 and their company, Yupiq, is rapidly growing
and in the process of receiving its second round of
funding from investors. Initially a team of four student
entrepreneurs, the company now employs seven people.
• BCIC-New Ventures Competition: BCIC partnered
with the New Ventures BC Society to deliver the
annual competition for emerging entrepreneurs that
has operated in British Columbia since 2001. This
technology idea competition is designed to provide
entrepreneurs with the tools and resources needed to
successfully take their ideas to the marketplace.
Key Achievements: The 2012 competition saw 146
applicants. Top prizes were awarded to an online
learning platform, a dental implant technology
provider and an online child caregiver search tool.
In total $235,000 was awarded in prizes - these
companies join more than 1500 program alumni over
12 years of competition.
A study released in February 2013 by the SFU’s Beedie
School of Business found that of companies that
advanced to the third round between 2001 and 2011
of the BCIC-New Ventures Competition:
– 56% are still active in some form and collectively
have created 3,170 jobs and generated an
estimated $194 million in revenue; and
– These ventures filed an estimated 854 patents and
generated 1,294 unique product offerings.
• The BCIC Mentor Program: a province-wide
entrepreneurial development program for founders
and CEOs of British Columbia technology ventures has
been offered by BCIC since its launch in 2011. Modeled
on the very successful MIT Venture Mentoring Service,
the BCIC Mentor Program adopts best practices from
ACETECH’s Growth Strategy Program, which delivers
tools and peer mentoring to CEOs of technology
companies in order to improve their effectiveness as
leaders. Program participants are early-stage startups
with a goal to progress and grow. By delivering
expert guidance and timely support in developing
their ventures, the program improves the success of
participating entrepreneurs and helps them take their
companies to the next level.
Key Achievements: Since its launch in January
2011, BCIC has recruited and trained 108 mentors,
and accepted 128 companies into the program. In
2012/2013, 61 mentors and 54 early-stage technology
CEOs and founders actively participated in the
program. On average, these early stage companies
support 6.7 jobs each.
Program Area: Commercialization
of Technology
BCIC’s goal of facilitating the commercialization of
innovative technology is supported by its network of
acceleration programs and programs that develop
entrepreneurial talent at the post-secondary level. For
example:
• In 2012/2013, BCIC launched the BCIC Acceleration
Network, a province-wide alliance of regional
partners delivering the Venture Acceleration Program,
Overview of Core Business Areas (continued)
Bill MacEwan,
Founder of SpaceList,
a participating company
in the 2012 BCIC-New
Ventures BC Competition
BC Innovation Council Annual Report 2012 | 2013 11
a structured venture growth program to technology
entrepreneurs across British Columbia. Through the
BCIC Acceleration Network, new and early-stage
technology companies throughout the province
gain access to highly qualified entrepreneurial
expertise and know-how. In 2012/2013 the program
was delivered in the Okanagan and Victoria. The
program was expanded later in the year through three
partnerships in the Lower Mainland as well as one
each in Kamloops and Nanaimo. Plans were set in
motion in to serve the West Kootenays by 2013/2014.
Key Achievements: Since its inception, the BCIC
Acceleration Network has engaged 102 companies
through five partners in the Lower Mainland, Fraser
Valley, Okanagan, Victoria, Vancouver Island, Sunshine
Coast and Central Interior regions. Collectively, since
engagement, these companies have added 273 full-
time jobs and attracted over $12 million in investment.
• BCIC launched the BCIC-Mitacs Commercialization
Voucher Program in 2012/2013 in partnership with
Mitacs, a national not-for-profit research organization
that develops the next generation of innovators with
vital scientific and business skills. A pilot program
designed to help British Columbia businesses rapidly
bring their ideas and products to market, the program
enables companies to retain a graduate student from
a British Columbia-based post-secondary research
institution for commercialization assessments of new
products or services, or new market opportunities for
existing products or services.
Key Achievements: During the pilot phase, the
Voucher Program received a total of 56 applications
from companies, 49 of which were matched with
appropriate student candidates and presented to BCIC
for review. Of the 49 applicants that were reviewed, 37
were approved. All funded projects are scheduled to
be completed by September 30, 2013.
• BCIC continued as the custodian of the $50 million
Natural Resources and Applied Science Research
Endowment (NRAS) originally provided by
Government in 2005/2006 to build research and
development, advanced training, technology transfer
and commercialization capacity in British Columbia
in engineering, natural resources and the applied
sciences. The first funding program to emerge from the
endowment was the NRAS Research Team Program,
developed collaboratively by BCIC and BCFRST in
2009. The endowment continues to earn interest
and, once sufficient interest has grown, BCFRST may
deliver further programs.
Key Achievements: The NRAS Research Team Program
competition received 102 applications in 2009 and
granted 24 awards for a total of $6.7 million. In
addition to the more than 50 researchers participating
on the teams, the projects involve high-calibre training
and supervision for 25 university students.
Program Area: Technology
Awareness
In support of all BCIC programs and initiatives, BCIC aims
to increase awareness of British Columbia’s science and
technology sectors domestically and internationally.
BCIC does this by linking British Columbia companies
to international growth opportunities as well as by
increasing awareness of the achievements of the British
Columbia technology community. For example:
• On March 15, 2013, BCIC and several partners from
British Columbia’s technology community presented
A Dialogue… Building and Sustaining BC’s
Technology Ecosystem. The event featured
presentations by several large technology companies
based in Vancouver. A panel involving several capacity
builders in British Columbia’s technology communities
and a keynote presentation provided opportunities for
the more than 200 attendees to participate in an open
dialogue. Attended by key decision makers including
Overview of Core Business Areas (continued)
Premier Christy Clark
attends A Dialogue…
Building and Sustaining
BC’s Technology
Ecosystem
BC Innovation Council Annual Report 2012 | 2013 12
community builders, CEOs, venture capitalists and
members of the provincial government, the event saw
an exchange of ideas between those who are making
British Columbia a great place to start and grow
technology companies.
• BCIC was the provincial ambassador for the 2012
Startup Canada Campaign, a nationwide tour
to celebrate and inspire entrepreneurship. BCIC
chaired the Startup Canada BC Steering Committee.
Working with more than 20 partners including
industry associations, support organizations and
entrepreneurs, the BC Steering Committee organized
events in seven British Columbia communities over
a two-week period in September 2012. The British
Columbia events drew more than 1,800 people from
sectors ranging from agri-tourism to technology,
with cultural backgrounds spanning immigrant
entrepreneurs to First Nations communities.
As a result of the national tour, Startup Canada
Communities was launched in May 2013. This pan-
Canadian network provides entrepreneurs with local
access to mentors, space, funding and support to
grow their businesses. Startup Canada Communities
is being piloted in 15 communities, including three in
British Columbia.
• In 2012, BCIC again supported metabridge, an
initiative that provides British Columbia technology
companies with direct connection and access to
key international technology partners for customer,
investment, strategic partnerships, mentorship and
advisory opportunities.
• BCIC was a silver sponsor of the annual GROW
conference again in 2012. Each year GROW brings
together more than 800 people among them founders,
investors, entrepreneurs, bloggers, developers,
designers and more. GROW has earned the reputation
of being Canada’s leading technology conference.
• BCIC partners with industry associations, regional
science and technology councils, academic institutions
and other organizations to identify and promote
technology success stories. The result is raised
awareness of British Columbia as a great place to start
and grow technology companies in all areas of the
province. Success stories published by BCIC in 2012
and instances of BCIC in the news can be found on the
BCIC website at www.bcic.ca/success-stories and www.
bcic.ca/bcic-in-the-news respectively. For example,
BCIC frequently features success stories of companies
in the BCIC Mentor Program such as Squeezease
Therapy’s success with its product SnugVest, created
for children and teens with autism and other sensory
disorders: www.bcic.ca/blog/2013/providing-a-firm-
hug-with-snug-vest-a-bcic-mentor-program-co.
Benefits for British Columbians
A fundamental function of BCIC is to accelerate the
development of the knowledge-based economy in
the province, directly leading to improved economic
performance for British Columbia. Within BCIC’s
mandate, this is accomplished by running programs
that increase the quantity of successful technology
entrepreneurs and companies. BCIC helps to create
new jobs and economic growth for the province by
building entrepreneurs and transforming research into
commercial ventures.
Overview of Core Business Areas (continued)
Donnie Ungaro (left)
and Michael Blonde (right):
Directors of metabridge 2012
Kerith Perreur-Lloyd and Sarah Doherty,
Founders of Sidestix.
Sidestix is an award holder of the
2010 BCIC-New Ventures BC Regional
Competition and the 2012 Mid-Island
Science and Technology Council (MISTIC)
Innovation Award.
BC Innovation Council Annual Report 2012 | 2013 13
Principal Partners, Clients
and Stakeholders, Delivery
of Services
BCIC designs, develops and implements many of its
programs and services in conjunction with its delivery
partners. All of its delivery partners are not-for-profit
organizations with a regional development focus or with
an affiliation with an educational institution.
BCIC also has a unique role in facilitating partnerships
between academia and industry to solve real world
problems through direct and applied research. Such
partnerships result in increased commercial activity.
BCIC also engages with federal and other provincial
government agencies, research institutions, industry and
regional groups to coordinate and enhance its programs.
In 2012/2013, BCIC maintained partnerships with more
than 20 organizations. Examples include accelerators such
as Accelerate Okanagan, Victoria Advanced Technology
Council and Wavefront; academic partners such as Simon
Fraser University and the University of Victoria; business
competition organizers such as New Ventures BC; and
regional technology councils such as Innovation Island
(formerly Mid-Island Science & Technology Innovation
Council) in Nanaimo and Kootenay Association for Science
& Technology in the West-Kootenay region.
Regions as defined by BCIC are indicated in the map in
Figure 1 below.
Overview of Core Business Areas (continued)
Figure 1: BCIC British Columbia Regions
BC Innovation Council Annual Report 2012 | 2013 14
Location
BCIC’s office is located at the Leading Edge Technology
Centre in downtown Vancouver in close proximity to
several key technology industry associations and
other complementary organizations. Locating in such
an environment allows BCIC further collaboration
opportunities.
The Leading Edge Technology Centre is on the
9th floor, 1188 West Georgia Street, Vancouver,
British Columbia V6E 4A2.
Overview of Core Business Areas (continued)
BC Innovation Council Annual Report 2012 | 2013 15
BCIC follows, and is in compliance with, the Board
Governance guidelines posted on the Board
Resourcing and Development Office (BRDO) website.
Role and Membership
of the Board
The Lieutenant Governor, through Order-in-Council,
appoints the members of BCIC’s Board, and delegates
the role of the Chair. The Board Chair reported to
the British Columbia Legislative Assembly through
the Minister of Advanced Education, Innovation and
Technology. The Board of Directors had seven members
in 2012/2013:
• Jill Leversage, Chair
• Jonathan Burke
• Gurval Caer
• Robin Ciceri
• Lorraine Larkin
• Derek Lew
• Cheryl Slusarchuk
The Board
• Sets the strategic direction and approves appropriate
plans from management;
• Recruits, empowers and monitors the executive
management;
• Shepherds and safeguards BCIC resources, approving
major financial decisions, ensuring internal controls
are in place and addressing areas of risk; and,
• Measures corporate performance, reporting regularly
to the stakeholders to ensure compliance with
applicable laws and ethical standards.
Corporate Governance
BC Innovation Council Annual Report 2012 | 2013 16
Corporate Governance (continued)
Purpose Committee Members
The Audit and Finance Committee helps the Board
fulfill its obligations and oversight responsibilities
relating to the audit process, financial reporting,
corporate control systems and risk management.
When required, it makes recommendations to the full
Board for approval.
Lorraine Larkin (Chair)
Jonathan Burke
Cheryl Slusarchuk
The Governance and Board Nomination Committee
reviews Board policies and practices, ensuring
BCIC fulfills its legislated mandate and implements
effective due diligence over BCIC’s governance.
The Full Board
The Human Resources and Compensation Committee
is a committee of the full Board that fulfils the Board’s
responsibilities with respect to BCIC’s staff policies
and practices.
The Full Board
Board Committees
Senior Management Team
• John Jacobson – President and CEO
• Jenny Choboter – CFO
• Paulin Laberge – Entrepreneur-in-Residence
• Dean Prelazzi – Managing Director,
BCIC Acceleration Network
• Lindsay Chan – Director of Communications
• Tomica Divic – Director of Operations
Governance Principles
BCIC’s Board has adopted the guiding principles outlined in
the Province of British Columbia’s Governance Framework
for Crown Corporations in establishing a framework from
which to operate. These principles include:
• Stewardship, leadership and effective functioning
of the Board
• Performance and value, innovation and continuous
improvement.
Governance Disclosure and Key
Accountability Relationships
BCIC’s governance documents and related disclosure
practices are available at www.bcic.ca/corporate-reports
where a full log and library of all documents related to
BCIC and its activities reside.
BCIC is a Crown Agency of the Province of British
Columbia. BCIC’s Annual Service Plans and Annual
Reports in fiscal year 2012/2013 were submitted to
the Ministry of Advanced Education, Innovation and
Technology.
BCIC works with program partners to provide input
on funded activities and program partners are
responsible for submitting regular reports to
BCIC regarding funded activities.
BC Innovation Council Annual Report 2012 | 2013 17
Goals, Objectives, Key Strategies,
Measures And Targets
BCIC Goals and Performance Measures
BCIC continues to work with industry, government
and the province’s academic institutions to identify
opportunities and gaps in its strategies directed
at developing entrepreneurs and promoting the
commercialization of technology. Once identified, BCIC
works with partners to address these needs through the
development and refinement of initiatives.
BCIC plays an integral role in helping shape the
development of British Columbia’s knowledge economy.
Because this role is fundamental for future job growth
and economic development in British Columbia, BCIC
considers it critical to have accurate performance
measures to track its progress in fulfilling its mandate.
Report on Performance
BC Innovation Council Annual Report 2012 | 2013 18
Goal 1: Entrepreneurial Talent Development & Retention
BUILDING BETTER ENTREPRENEURS FOR BRITISH COLUMBIA
BCIC works with its program partners to help British Columbians to become successful entrepreneurs.
Objective
• To improve early-stage commercialization skills of entrepreneurs in the British Columbia science and technology
community. Examples of these skills include business management, leadership, ability to communicate with
investors, customers and other stakeholders.
Strategies
• Identify and provide relevant knowledge and training to support early-stage entrepreneurs to commercialize their concepts.
• Partner with educational institutions and industry organizations to provide relevant knowledge and training for
emerging entrepreneurs.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 19
Report on Performance (continued)
MEASURE 1: ACTION PLANS FOR TECHNOLOGY ENTREPRENEURS
Description of Measure
This measure records the number of Action Plans
developed for and completed by early-stage
entrepreneurs by BCIC. An Action Plan is a document
describing strategies and next steps as recommended by
BCIC experts to improve entrepreneurs’ business plans,
enhance their skills and marketability and improve their
opportunities to gain access to capital funding.
Importance of Measure
An Action Plan provides expert advice to help budding
entrepreneurs understand what their “best and most
important next steps” are in the development of their
enterprises. A solid business foundation of key skill
sets is vital in the early stages of entrepreneurial
development – an area where the BCIC can provide
invaluable advice and guidance. Each technology
entrepreneur that receives an Action Plan will have a
much greater chance of commercial success, leading to
long-term business growth and higher quality jobs for
British Columbians.
Reason for Variance
This measure was exceeded because original estimates
by BCIC and several partner organizations were
conservative. Estimates are based on BCIC and partners’
ability to forecast demand for programs; the greater the
number of participants, the higher the number of Action
Plans that will be developed. BCIC has collected program
results in cooperation with our partner organizations
including the nine organizations that make up the BC
Regional Science and Technology Network and the six
University Industry Liaison Offices in the province. Some
partners experienced program growth as well as greater
demand than anticipated for programs. For example,
Simon Fraser University encountered greater demand
for its programs that resulted in twice the number
of Action Plans expected. As another example, the
University of Victoria increased its efforts to encourage
entrepreneurialism among students and faculty – as
a result, they also created twice as many Action Plans
as expected. The overall result is several hundred more
Action Plans over BCIC’s target.
* Measure has been retired as of 2013/2014. A new measure, titled Health Score of Ventures in the BCIC Acceleration
Network, is being implemented in 2013/2014 which includes the above as an indicator within a composite score.
The new measure considers several important elements for a venture to progress.
The number of Action Plans completed by BCIC for technology entrepreneurs that will directly advance
their early stage commercialization skills and improve their chances for commercial success
Past Performance 2012/2013 2013/2014
2010/2011 2011/2012 TARGET ACTUAL TARGET
463 815 463 834 n/a*
BC Innovation Council Annual Report 2012 | 2013 20
Report on Performance (continued)
MEASURE 2: SATISFACTION RATING OF BCIC’S PROGRAMS AND SERVICES
Description of Measure
This measure provides a percentage of the general
satisfaction BCIC clients have with BCIC’s programs. This
measure is based on sample surveys where satisfaction
is defined as a value of 7 or more on a 10-point
satisfaction scale. Performance targets are based on
similar past BCIC surveys.
Importance of Measure
Confirmation from entrepreneurs that BCIC-funded
programs enable their ventures to progress, adds
perspective to how BCIC measures its progress. BCIC’s
goal is to support programs that provide high value to
technology entrepreneurs, equipping them with the
knowledge and tools to advance their technologies.
Evaluation results enable BCIC to assess how well it is
delivering on its mission. Reports from the participants
of BCIC-supported programs and services will help to
shape, refine and improve BCIC offerings and position
BCIC as an integral component to the growth and
success of its client companies.
Reason for Variance
This measure was exceeded; however, it is noted that the
result for 2012/2013 is lower than the result for the year
prior. The reason for the lower result is the low ratings
attributed to one program, entrepreneurship@SFU. 2012
was the second year of this new program and BCIC is
taking steps to improve satisfaction with this program.
The target for this measure was based on observation
of past program satisfaction surveys; however, BCIC has
since developed a different grouping of programs than
when the targets were set. For example, past programs
included student events whereas current programs
focus on the training and development of entrepreneurs.
Future targets have been adjusted upward from the
previous forecast, based on results observed over the
last two years.
The percentage of BCIC clients who are satisfied that BCIC’s programs and services will help advance
the commercialization of their technology
Past Performance 2012/2013 2013/2014 2014/2015 2015/2016
2010/2011 2011/2012 TARGET ACTUAL TARGET TARGET TARGET
80% 93.66% 75% 82% 90% 90% 90%
BC Innovation Council Annual Report 2012 | 2013 21
Goal 2: Commercializing Innovative Technology
BUILDING INCUBATORS AND ACCELERATORS, AND FACILITATING PARTNERSHIPS BETWEEN ACADEMIA
AND INDUSTRY TO STRENGTHEN TECHNOLOGY COMMERCIALIZATION IN BRITISH COLUMBIA
BCIC supports programs and initiatives that help innovations reach the market. The net result will be a more vibrant
economy and more high quality jobs for British Columbians.
Objective
• To increase the number of new businesses in British Columbia’s technology sector.
• To increase the growth rate of small and medium-sized (SME) businesses in British Columbia’s technology sector.
Strategies
• Build a network of incubators inside educational institutions to train students to be entrepreneurs and launch
startup companies.
• Build a network of business accelerators to rapidly grow early-stage technology companies.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 22
Report on Performance (continued)
MEASURE 3: STARTUP GROWTH COMPONENTS ACHIEVED BY ENTREPRENEURS
Description of Measure
This measure captures key Startup Growth Components
(please see Appendix A for a complete list of these
Components) entrepreneurs need to accomplish to
effectively commercialize their concepts, paving the
way for their early-stage growth. These Components
can be customized to meet the unique needs of each
entrepreneur, for their specific industry sector or for
their company’s life stage. The following are examples
of Startup Growth Components: i) early-stage market
research plan, ii) IP strategy, iii) revenue model, iv) risk
assessments, v) financing plan and vi) strategic selling
and sales processes.
Importance of Measure
It is imperative that British Columbia is able to expedite
the commercialization of technology to increase
the province’s rate of economic growth as well as
its competitive advantage. To help accomplish this,
entrepreneurs need to have as many key Startup Growth
Components achieved as possible for a solid business
foundation for the success of their companies. The
higher the number of key Startup Growth Components
achieved by an entrepreneur, the greater their chance of
commercial success.
Reason for Variance
This measure was exceeded because original estimates
by BCIC and several partner organizations were
conservative. Estimates are based on BCIC and partners’
ability to forecast demand for programs; the greater
the number of participants, the higher the number of
Startup Growth Components that will be achieved. BCIC
has collected program results in cooperation with our
partner organizations including the nine organizations
that make up the BC Regional Science and Technology
Network and the six University Industry Liaison Offices
in the province. Some partners experienced program
growth as well as greater demand for programs than
anticipated. For example, VIATeC exceeded its target
by almost 500% because its Executive-in-Residence
worked with entrepreneurs to achieve milestones in a
timely manner. As another example, Northwest Science &
Innovation achieved twice its target because it retained
a business coach to work with clients in 2012/2013.
* Measure has been retired as of 2013/2014. A new measure is being implemented in 2013/2014 which includes the
above as an indicator within a composite score. The new measure considers several important elements for a venture
to progress.
The number of key Startup Growth Components achieved by entrepreneurs who have been directly supported
through BCIC’s programs and services
Past Performance 2012/2013 2013/2014
2010/2011 2011/2012 TARGET ACTUAL TARGET
1976 2100 1976 2700 n/a*
BC Innovation Council Annual Report 2012 | 2013 23
Goal 3: Increase Awareness of BC’s Knowledge Economy
Raising awareness of the knowledge economy in British Columbia and its vital role for the future growth of the province
is important. BCIC supports these activities by increasing the awareness of successful local technology companies and
by helping to position our province as a world class destination for international technology companies to establish a
presence.
Objective
• Increase awareness of British Columbia’s science and technology sectors and their achievements both domestically
and internationally.
Strategies
• Develop and promote success stories of British Columbia technology entrepreneurs through print, digital, broadcast
and social media, industry associations and other channels.
• Increase awareness of BCIC among British Columbia’s science and technology stakeholders.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 24
Report on Performance (continued)
MEASURE 4: TECHNOLOGY SUCCESS STORIES PROMOTED BY BCIC
Description of Measure
This measure captures the reach of British Columbia
technology success stories and is a count of the number
of stories placed by BCIC through print, digital, broadcast
and social media, industry associations and other
channels. Examples of success stories published by BCIC
in 2012 and instances of BCIC in the news can be found
on the BCIC website athttp://www.bcic.ca/success-
stories andhttp://www.bcic.ca/bcic-in-the-news
respectively. BCIC includes all technology success stories
issued by the organization as well as all instances of
the story being picked up by other sources (repeated or
re-written). This includes blog stories and media releases
picked up by digital, print and other sources. It does not
include mentions or tweets.
Importance of Measure
It is essential to increase the awareness of the economic
impact and success of British Columbia’s technology
companies to encourage new entrepreneurs, motivate
existing ones and to create an environment that supports
the growth of a knowledge economy. This will ultimately
lead to more commercial success stories, greater
employment in the sector and increased economic
benefits for the province.
Reason for Variance
BCIC worked closely in 2012/2013 with technology
start-up companies to develop compelling articles
on their successes. These articles were published on
BCIC’s website as well as through partner channels. For
example, VIATeC made a significant effort to promote
technology success stories and the recently launched
Tectoria brand. As a result, VIATeC surpassed its initial
target of 100 by placing 223 stories in 2012/2013. In
addition, Accelerate Okanagan exceeded its initial target
of 48, with a total of 130 success stories, due to the
strong engagement between its Marketing team and the
client ventures in its programs.
* Measure retired as of 2013/2014. Although BCIC continues to promote BC as a great place to be a technology
entrepreneur, BCIC’s goals and objectives for 2013/2014 are more focused on results than on activities
The number of technology success stories, promoted by BCIC, published through print, digital, broadcast
and social media, industry associations and other channels
Past Performance 2012/2013 2013/2014
2010/2011 2011/2012 TARGET ACTUAL TARGET
170 733 170 664 n/a*
BC Innovation Council Annual Report 2012 | 2013 25
Benchmarking
As BCIC reviews and develops its focus areas, it
continues to investigate similar jurisdictions that
are currently focusing on entrepreneurial talent
development and the commercialization of technologies.
In most cases this is a continuous process and activities
undertaken in 2012/2013 can be captured by the
standard benchmarking model in Figure 2.
Topics under consideration when consulting with or
monitoring other organizations include:
• Mentor and coaching methodologies – for example,
the BCIC Mentor Program is based on the MIT Venture
Mentor Service and BCIC regularly attends MIT’s user
group events in order to learn from the results of other
Program Leaders;
• Performance Measures – for example, BCIC compared
performance measures used by similar organizations
when refining its own performance measures;
• Venture engagement models
• Venture intake models/process
• Venture growth and development models
• Accelerator management models
• Funding models
• Types of community events other organizations are
running for the purpose of engaging the community
and encouraging/furthering entrepreneurship in the
community; and
• Publications released by or in connection with an
organization BCIC is monitoring.
BCIC is currently examining industry associations,
innovation councils, academic and private organizations
focusing on entrepreneurial talent development and the
commercialization of technologies. In addition, BCIC consults
with organizations involved with incubation, acceleration and
mentorship programs. Examples of organizations consulted
and monitored in 2012/2013 include:
• Alberta Innovates - Technology Futures
• Barcelona Activa
• Cambridge Innovation Centre
• Canadian Innovation Centre
• Chicago Innovation Mentors
• Communitech
• GrowLab
• Innovacorp
• Innovate St. Louis
• Innovation Place: Saskatchewan Opportunities
Corporation
• IRAP
• Jumpstart Inc.
• Launch Academy
• MaRS
• MIT Venture Mentor Service
• National Business Incubation Association
• Ontario Centre for Excellence – Centre for
Commercialization Research
• Saskatchewan Research Council
• SFU Venture Labs
• Techstars
• The Hub of Human Innovation
• Universidad Anáhuac
• Western Economic Diversification
Recognizing the dynamic nature of the technology
and startup landscape, BCIC continually monitors
developments in its focus area.
Report on Performance (continued)
Update Plan
Choose
Benchmarks
Measure Current
Performance
Compare
with Plan
Study
Similar Results
from Others
Compare
Results
Figure 2: Benchmarking Cycle
BC Innovation Council Annual Report 2012 | 2013 26
Management’s Confidence
in Data Integrity
BCIC’s performance management system is designed
to provide efficient and practical measurements
of BCIC’s goals. The measurements chosen are
quantifiable. This results-focused approach enables
BCIC to see when targets are met, objectives are
achieved and assess whether changes to programs
and strategies are necessary.
The success of BCIC programs are measured via
the following:
• Surveys: Issued to program participants by program
leaders via email on an annual basis, or more
frequently if appropriate.
• Progress Reports: BCIC gathers information via
progress reports submitted by program leaders.
Management is confident in the operational data
utilized in reporting the results of its activities. BCIC’s
sources of data include in-house records maintained
through electronic databases and progress reports
submitted by program partners. As a condition of
support to partners, BCIC requests appropriate records
be maintained and reported.
Data is collected throughout the year depending on the
activity and verified according to established reporting
guidelines to ensure consistency from past years and
across similar activities.
While accuracy is limited by human error, BCIC validates
questionable data as part of the monitoring process for
reports submitted externally.
Opportunities and Challenges
Subsequent to the review of BCIC’s mandate in 2011,
BCIC worked with Government in 2012/2013 to refresh
its mandate and align its goals, measures and targets.
Some changes were implemented during 2012/2013 and
the remainder of which were set in place for 2013/2014.
The renewed mandate also directed BCIC to change
its funding process to enhance transparency and
accountability. Revisions began in 2012/2013 to
ensure that new program spending is based on specific
work plans developed and proposed by the funded
organization, and will include appropriate measures
of progress and outcomes. As a result, funding that
BCIC previously provided as core funding to some of
its partners will end at the close of 2012/2013 and be
replaced with funding under contribution agreements
as described. BCIC focused effort in 2012/2013 to
communicate the effects of the changes to partners.
In 2012/2013 BCIC focused on programs that accelerate
the commercialization of technology through supporting
startups and the development of entrepreneurs. BCIC
activities are part of the continued movement toward
technology startup incubators and accelerators.
Risk and Capacity Issues
With growing fiscal restraint on BCIC’s funding sources,
annual funding levels have a significant impact on BCIC’s
operations. If there are further changes to the level of
funding BCIC receives from Government, BCIC’s ability
to leverage funds to finance projects, programs and
initiatives from other sources may be affected. Such
sources may include various organizations within the
federal and provincial governments as well as private,
public and not-for-profit science and technology
organizations.
Strategies to mitigate this risk include ongoing
communications with BCIC’s existing and potential
funding sources, in order to build awareness of the
level of support required. In addition, BCIC explores
the development and implementation of programs and
initiatives that are either self-supporting or leveraged
with other revenue generating sources.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 27
The Government’s Letter of Expectations (the Letter)
between the Ministry of Advanced Education, Innovation
and Technology (Government’s representative) and
BCIC is an agreement on the parties’ respective
accountabilities, roles and responsibilities. The Letter
confirms BCIC’s mandate and priority actions, articulates
the key performance expectations as documented
in the Government’s Expectations Manual for British
Columbia Crown Agencies[1], and forms the basis for
the development of BCIC’s Service Plan and Annual
Service Plan Report. The Letter does not create any legal
or binding obligations on the parties and is intended to
promote a co-operative working relationship.
As a result of the Mandate Review conducted by the
Province in 2011, BCIC was also provided with a Letter
of Direction in October, 2012 with specific guidance. In
addition, BCIC received a Letter of Direction regarding
use of Leading Edge Endowment Fund assets.
For the 2012/2013 fiscal year, Government directed BCIC
to take the following specific actions:
Letter of Expectations and
Letters of Direction From Government
Government’s Letter of Expectations for 2012/2013
Specific Directions from Government
i) Work in partnership with the Government to implement the approved recommendations outlined in the
2011/2012 British Columbia Innovation Council Mandate Review.
ii) Provide advice to the Minister, as requested, in support of the advancement of technology commercialization
and the entrepreneurial science and technology culture in British Columbia.
BCIC’s Response
i) Based on the observations of the Mandate Review Team, BCIC developed a set of Guiding Principles within
which BCIC began to operate in 2012/2013. They are listed below, along with a status update.
(continued on next page)
BC Innovation Council Annual Report 2012 | 2013 28
Letter of Expectations and
Letters of Direction From Government (continued)
Government’s Letter of Expectations for 2012/2013 (continued)
BCIC’s Response (continued)
KEY FOCUS – accelerate the commercialization of technology through supporting startups and the development
of entrepreneurs
BCIC has substantially eliminated all programs that do not meet this principle, while creating new programs and
expanding existing programs and activities that support the key focus. As an example, the BCIC Mentor Program
currently provides mentor services to 51 BC early-stage startups.
In 2012/2013, BCIC launched the BCIC Acceleration Network, a province-wide alliance of regional partners
delivering a structured venture growth program to technology entrepreneurs across British Columbia. Through the
BCIC Acceleration Network, new and early-stage technology companies throughout the province gain access to
highly qualified entrepreneurial expertise and know-how. In 2012/2013 the program was delivered in the Okanagan
and Victoria. The program was expanded later in the year through three partnerships in the Lower Mainland as well
as one each in Kamloops and Nanaimo. Plans were set in motion in to serve the West Kootenays by 2013/2014.
WORK WITH PARTNERS – both to plan and deliver programs and initiatives
BCIC continues to maintain and build relationships with program partners. In 2012/2013, BCIC had agreements
with more than 20 partners to deliver programs and initiatives. As the 2012 provincial ambassador for Startup
Canada, BCIC collaborated with and empowered 20 partners from throughout BC to deliver 15 entrepreneurship
development seminars and networking sessions in seven cities – Kelowna, Penticton, Victoria, Prince George,
Vancouver, North Vancouver and New Westminster.
CROSS-SECTOR – in line with the BC Jobs Plan
BCIC’s programs support technology companies whose products and services are fostering innovation across a
broad cross-section of industries, including all key industry sectors identified in the BC Jobs Plan.
In addition, BCIC initiated development of a Cross-Sector Strategy in 2012/2013 that will enable BCIC to diversify
programming into the priority sectors.
PROVINCE-WIDE – “demand led” access to programs and support
The BCIC Acceleration Network is an initiative that supports regional expansion of BCIC-funded activities. The
Network requires partners to assess program demand as part of the application process. BCIC is rolling out this
structured startup growth and mentorship program throughout British Columbia and in 2012/2013 already had
partners in place in Victoria, Kelowna, Nanaimo and Kamloops.
(continued on next page)
BC Innovation Council Annual Report 2012 | 2013 29
Government’s Letter of Expectations for 2012/2013 (continued)
BCIC’s Response (continued)
LEVERAGED FUNDING – required
In 2012/2013 BCIC collaborated with Southern Interior Development Initiative Trust and Northern Development
Initiative Trust to secure matching funding for BCIC Acceleration Network funding plans in regional centres. BCIC
Acceleration Network program funding is also partially supported by participant fees, corporate sponsorships and
other government funding. BCIC Acceleration Network program funding is also partially supported by participant
fees and corporate sponsorships. This model continues to be a priority as the BCIC Acceleration Network expands
throughout the province.
RESULTS-BASED FUNDING – no restricted or guaranteed “flow through” support
All newly agreed BCIC-supported programs and activities require regular and full reporting. Program agreements
are based on estimates of demand and agreed targets for delivery and results. In order for a partner to qualify for
repeat funding, they must report actual demand and performance results as compared with original estimates.
These results inform future funding and program design decisions.
INCUBATE PROGRAMS - create and launch before transferring to partners
In 2012, BCIC worked with regional partners to create and launch the BCIC Acceleration Network. BCIC intends
to transfer the Network’s governance to partners after one or more pilot years, provided a business model can be
developed that doesn’t create additional administrative burden that would detract from direct program spending.
TECHNOLOGY AWARENESS - focused on BCIC programs
BCIC promotes technology awareness by featuring BCIC programs through the BCIC blog and social media. In
2012/2013, BCIC has supported 11 partner events, posted 95 blog stories and issued 15 media releases. Externally,
BCIC has appeared in 24 news stories. BCIC is also active with social media including Twitter, Linkedin and
Facebook.
FULL MEASUREMENT - meaningful and accurate measurement and reporting
BCIC gathers information on the results and performance of the programs it supports. BCIC reviewed its existing
measures in 2012/2013 and developed new measures that capture relevant data. BCIC has developed three new
outcome-based measures for 2013/2014. All four measures used by BCIC for 2013/2014 serve to measure aspects
of participating companies’ ability to progress toward job creation.
ii) BCIC continues to provide feedback and advice to the Minister in support of technology commercialization
in the province.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 30
Letter of Direction from Government October 2, 2012
Key Sections in Letter of Direction BCIC’s Response
BCIC divest itself of all non-core responsibilities,
including Science Fairs and secondary school
programs;
BCIC has divested itself of all non-core responsibilities,
including Science Fairs and secondary school
programs. Many programs were transferred to relevant
organizations. For example, delivery of the Paul and
Helen Trussell Science & Technology Scholarship has
been assumed by the Vancouver Foundation. Delivery
of the 2012 Innovation Exploration program was
assumed by the Science Fair Foundation of BC.
Incubate and develop key programs in partnership with
AEIT and deliver programs through well-established
partners that use outcomes-based reporting and
transparent practices;
BCIC works with well-established partners to develop
and deliver key programs such as the Venture
Acceleration Program. All partner agreements include
the requirement to report on BCIC’s outcomes-based
measures. In addition, all partnerships are based on
proposals that provide insight into the practices of the
organization.
Align BCIC’s board governance model with Board
Resourcing and Development Office (BRDO) polices and
best practices;
BCIC continued in 2012/2013 to ensure consistency
with the Board Resourcing and Development Office
(BRDO) polices and best practices.
Develop a new set of outcome-based performance
measures as part of a rigorous approach to planning
and evaluation, and extend these metrics to partner
selection and reporting;
BCIC developed three new measures to be
implemented in 2013/2014. All four measures to
be used in 2013/2014 serve to measure aspects of
participating companies’ ability to progress toward job
creation. Partners explain during the selection process
how they will include data on the measures in their
reporting.
Diversify programming to expand entrepreneurship
programs and support in priority sectors as outlined in
the BC Jobs Plan;
BCIC developed a Cross-Sector Strategy for 2013/2014
that will enable BCIC to diversity programming into
priority sectors as outlined in the BC Jobs Plan. In
addition, the BCIC Acceleration Network is an initiative
that supports regional expansion of BCIC-funded
activities.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 31
Letter of Direction from Government October 2, 2012 (continued)
Key Sections in Letter of Direction BCIC’s Response
Set up a board structure compatible with other
Crown corporations, with an accompanying contract
for fulfilling the duties of a board director formalize
conflict-of-interest rules, and define board director
expectations and accountabilities, including
attendance and time commitment expected;
BCIC’s board structure is meeting these standards.
Work with BRDO to complete board recruitment,
ensuring the gaps in skills and competencies are taken
into account and BC Jobs Plan sectors are represented,
and deliver a formal on-boarding and orientation to
new board directors to ensure they understand their
role and accountabilities;
BCIC continues to work with BRDO to complete board
recruitment, on-boarding and orientation.
Recruit and select BCIC executives and staff using a
competency profile and a strong, transparent recruiting
process including references;
BCIC is following these standards in recruitment.
Work with the Public Service Employers Council and
BRDO to ensure compensation is appropriate for
the CEO; the board may need to undertake a market
compensation study in order to make a case for its
recommended salary range.
BCIC is working with the Public Service Employers
Council and BRDO to meet these standards.
Develop a performance contract for the CEO that
includes development and execution of an operating
plan that is directly a result of the strategic plan
to build the right organizational structure, roles,
competencies and capacity for a highly credible
organization;
BCIC developed a performance contract for the CEO
that meets these standards.
Develop a full strategic plan, including assumptions,
financial and economic information, external
socio-economic research, risks and specific risk
mitigation strategies, data from industry partners
and government (the shareholder’s expectations), and
AEIT’s strategic priorities and advice;
BCIC has a strategic plan in place.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 32
Letter of Direction from Government October 2, 2012 (continued)
Key Sections in Letter of Direction BCIC’s Response
Develop and formalize a process for funding partner
proposals that includes specific criteria, ideally
including a peer-review process, and hold the
executive team accountable for implementation
and measurement of satisfaction amongst key
stakeholders, such as industry partners, UILOs and
BCRSTN Councils;
BCIC formalized a process for funding partner
proposals in July 2012 and continues to review and
refine the process. Satisfaction of program participants
is monitored and BCIC has plans to measure
satisfaction of key partners.
Board to meet with AEIT officials in Fall 2012 to review
and follow up on the implementation of directives listed
above. Meetings with AEIT Executive and the BCIC
Board Chair and CEO should also occur on a quarterly
basis to discuss specific goals and performance
measures to be used in the upcoming Service Pan and
Service Plan Annual Reports.
BCIC met with AEIT officials in Fall 2012 continues to
meet on a quarterly basis with AEIT Executive.
Letter of Direction from Government (Re. Leading Edge Endowment Fund) March 27, 2013
Specific Direction
Allocate Leading Edge Endowment Fund assets to the BCIC-Mitacs Commercialization Voucher Program
BCIC’s Response
As custodian of the residual assets of the Leading Edge Endowment Fund (LEEF), BCIC allocated funds to the
pilot phase of the BCIC-Mitacs Commercialization Voucher Program. During the pilot phase, the Voucher Program
received a total of 56 applications form companies, 49 of which were matched with appropriate student candidates
and presented to BCIC for review. Of the 49 applicants that were reviewed, 37 were approved. All funded projects
are scheduled to be completed by September 30, 2013.
[1] The Province of British Columbia’s Crown Agency Accountability System (www.gov.bc.ca/caro/publications/index.html)
establishes guiding principles for the governance of Crown corporations. The Government’s Expectations Manual
identifies roles and responsibilities for the Government and Crown corporations, and provides for a Government’s
Letter of Expectations (Letter) to be developed.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 33
Management Discussion and Analysis
A summary of the BC Innovation Council’s financial results is presented below. Chart A details BCIC’s current operations,
with comparison to budget and the prior year’s figures. The chart includes the results of operations for the previous four
years as well as forecast figures for the next three years. Forecast figures are consistent with the 2013/14 Service Plan.
BCIC received less annual funding in 2012/2013 compared to the previous fiscal year and has adjusted its operations
accordingly. BCIC will continue to develop new programs under the renewed mandate and deliver programs in
collaboration with its partners across the province.
Financial Report
BC Innovation Council Annual Report 2012 | 2013 34
Financial Report (continued)
CHART A
Summary of financial results and budget projections
(in thousands
of dollars)
2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Actual Actual Actual Actual Actual Budget
Budget
Variance
Year
Variance Forecast Forecast Forecast
Revenues
Province of British
Columbia
9,293 8,500 8,500 9,650 6,150 6,150 - (3,500) 6,090 6,090 6,090
Internal Program
Funding (1)
6,390 2,195 29 - 171 - 171 171 5,500 2,000 2,000
NRAS Endowment (2) 3,005 2,109 1,919 568 3 1,000 (997) (565) 1,000 1,000 1,000
Interest and Other 562 275 329 124 291 115 176 167 125 125 125
Total Revenues 19,250 13,079 10,777 10,342 6,615 7,265 (650) (3,727) 12,715 9,215 9,215
Expenses
Programs and
Initiatives
12,597 7,943 6,349 7,430 4,956 3,826 1,130 (2,474) 9,977 6,466 6,459
NRAS Endowment (2) 3,005 2,109 1,919 568 3 1,000 (997) (565) 1,000 1,000 1,000
Salaries and Benefits 1,869 1,915 1,590 1,392 1,027 1,529 (502) (365) 1,192 1,192 1,192
Rent 227 254 274 418 223 280 (57) (195) 237 237 237
Amortization 64 74 62 48 41 70 (29) (7) 40 45 45
Other operating
costs (3)
1,488 784 583 485 364 560 (196) (121) 269 275 282
Total Expenses 19,250 13,079 10,777 10,341 6,614 7,265 (651) (3,727) 12,715 9,215 9,215
Annual Surplus 0 0 0 1 1 0 1 - 0 0 0
Funds Committed to
Future Programs (1)
13,866 11,722 11,722 11,780 22,300 11,780 10,520 10,520 16,800 14,800 12,800
Capital
Expenditures (4)
124 78 14 13 36 50 (14) 23 50 50 50
Total Debt 0 0 0 0 0 0 0 0 0 0 0
• The balance of Funds Committed to Future Programs includes unrestricted assets and deferred revenue balances.
Year-to-year changes include Annual Surplus (Deficit), changes to capital assets and deferred revenues as detailed
in Note 4 and Note 6 of the audited financial statements.
• NRAS program revenues and expenses are included in the financial chart above.
• Other operating costs include legal and contracted services, meeting, travel & networking and office expenses.
• Capital Expenditures include the costs of computer equipment and software licences.
• The above financial information, including forecast information, was prepared based on current Public Sector
Accounting Standards.
BC Innovation Council Annual Report 2012 | 2013 35
Natural Resources and Applied Sciences (NRAS) Research Endowment Fund
In the 2005/2006 fiscal year, BCIC was charged with stewarding $50 million from the Province of British Columbia for
the Natural Resources and Applied Sciences (NRAS) Research Endowment Fund. As an endowment, it is expected that
the capital will be preserved and only the interest earnings will be spent on program activities. In 2012/2013 $3,139 was
spent on professional services. Once sufficient interest earnings have accumulated, further programs can be delivered.
CHART B
Financial Report (continued)
Natural and Applied Sciences Endowment Fund
(in thousands
of dollars)
2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Actual Actual Actual Actual Actual Budget
Budget
Variance
Year
Variance Forecast Forecast Forecast
NRAS
Endowment Fund
50,000 50,000 50,000 50,000 50,000 50,000 - - 50,000 50,000 50,000
Interest Accumulated,
Begin of the year
4,273 3,031 1,209 76 502 502 - 426 1,461 1,461 1,461
Annual investment
income
1,763 287 786 994 962 1,000 (38) (32) 1,000 1,000 1,000
Program expenditures (3,000) (2,000) (1,800) (560) - (1,000) 1,000 560 (1,000) (1,000) (1,000)
Administration and
professional fees
(5) (109) (119) (8) (3) - (3) 5 - - -
Interest Accumulated,
End of the year
3,031 1,209 76 502 1,461 502 959 959 1,461 1,461 1,461
Total Debt 0 0 0 0 0 0 0 0 0 0 0
BC Innovation Council Annual Report 2012 | 2013 36
Assessment of Changes in Results and Reasons for
Significant Variances and Trends
Provincial funding had been reduced to $6.15 million
this year and is expected to be further reduced to
$6.09 million next year. The future provincial funding is
forecasted to be the same for the next three years.
In 2012, BCIC received two gifts, one of $7 million
and another of $2.25 million. A further succession
transfer occurred of $1.47 million from the Leading
Edge Endowment Fund (LEEF) and is held in its reserve
as deferred program revenues. In the same year, BCIC
entered into a contract with Mitacs to develop and
deliver the pilot BCIC-Mitacs Commercialization Voucher
Program for up to $1 million from the $7 million LEEF
gift. In 2012/2013, $171,500 had been disbursed for
this program, and BCIC will continue to disburse the
remaining of the $1 million as agreed in the contract
until it is fully exhausted.
In 2012/2013 $3,139 was spent on professional services
under the direction of BCFRST Foundation.
Interest and other income were higher this year due
to receipt of a holdback payment for the sale of UB
Video shares in the amount of US$151,004, which was
transferred from BC Advanced Systems Foundation to
BCIC on March 30, 2007.
Programs and Initiatives expenses were lower than
last year because provincial funding was reduced by
36%. However, total program expenses exceeded the
budget by 29% as BCIC strived to reduce its operating
cost and used the savings towards programs. BCIC
divested itself of all non-core programs and launched
two new programs to focus its effort in developing
commercialization initiatives that accelerate the
commercialization of technology and development of
entrepreneurs in British Columbia.
Operating and administration expenses were lower
this year. Salaries and benefits were lower than
budgeted because BCIC went through a staff reduction
in 2011/2012 and a few anticipated recruitments
included in 2012/2013 budget did not proceed due to the
reduction in annual funding. Rent expenses were lower
because BCIC leased less office space.
BCIC’s total expenses in 2012/2013 were $6.614 million
with a surplus of $1,575.
BCIC’s capital expenditures were primarily for computer
equipment and software licenses.
Major Risks and Opportunities that Affected
Financial Performance
BCIC’s operations are primarily funded by the core
funding from the Province, and any changes to the level
of provincial funding will have significant impact on
BCIC’s operations. Strategies to mitigate this risk include
ongoing communications with BCIC’s existing and
potential funding sources, in order to build awareness of
the level of support required. In addition, BCIC explores
the development and implementation of programs and
initiatives that are either self-supporting or leveraged
with other revenue generating sources. BCIC has access
to its significant reserves and will work closely with
Government on how to utilize these reserves for the
development of future programs and initiatives.
With the establishment of the Natural Resources and
Applied Sciences Endowment Fund, interest rate levels
are a significant factor in the fund’s income; the primary
goal of investing the endowment is preservation of
the principal. Sufficient interest earnings have to be
accumulated before further programs can be delivered.
Financial Report (continued)
BC Innovation Council Annual Report 2012 | 2013 37
While the current uncertain economic climate is a
continued concern, BCIC has a valuable leadership
role in the Province and is confident that support from
government and other funding sources will continue
at strong levels. BCIC will focus its efforts on designing,
developing and implementing its programs and services
in collaboration with its delivery partners. BCIC will
continue to leverage funds from multiple sources for
the purpose of building more efficient and valuable
programs. BCIC will explore opportunities to develop new
programs and expand existing programs in accordance
with funding levels.
“The rise of innovation matters to all of us... innovative
industries bring “good jobs” and high salaries to the
communities where they cluster, and their impact on the
local economy is much deeper than their direct effect.
Attracting a scientist or engineer triggers a multiplier
effect, increasing employment and salaries for those
who provide local services.”
—Enrico Moretti, The New Geography of Jobs
Future Outlook
BC Innovation Council Annual Report 2012 | 2013 38
The financial statements of BCIC are the responsibility of
management and have been prepared in accordance with
Public Sector Accounting Standards, consistently applied
and appropriate in the circumstances. The preparation
of financial statements necessarily involves the use of
estimates which have been made using careful judgment.
In management’s opinion, the financial statements
have been properly prepared within the framework of
the accounting policies summarized in the financial
statements and incorporate, within reasonable limits of
materiality, all information available up to June 1, 2013.
The financial statements have been reviewed by BCIC’s
Audit Committee and approved by the Board of Directors.
Management maintains and relies on a system of internal
controls designed to provide reasonable assurance
that assets are safeguarded, transactions are properly
authorized and recorded, and that reliable and relevant
financial information is available on a timely basis.
The financial statements have been examined by
independent external auditors. The external auditors’
responsibility is to express their opinion on whether
the financial statements, in all material respects, fairly
present BCIC’s financial position, results of operations and
cash flows in accordance with Public Sector Accounting
Standards. The Auditors’ Report, which follows, outlines
the scope of their examination and their opinion.
The Board of Directors, through the Audit Committee,
is responsible for ensuring that management fulfils its
responsibility for financial reporting and internal controls.
The Audit Committee, comprised of directors who are not
employees, meets regularly with the external auditors and
management to satisfy itself that each group has properly
discharged its responsibility to review the financial
statements before recommending approval by the Board
of Directors and appointment of external auditors.
The external auditors have full and open access to the
Audit Committee, with and without the presence
of management.
Supplementary Documents and Statements
The signed Auditors’ Report, Audited Financial Statements
and accompanying notes to the financial statements follow.
Jill Leversage
Chair, BCIC
June 5, 2013
Statement of Management Responsibility
BC Innovation Council Annual Report 2012 | 2013 39
Signed Auditor’s Report
Independent Auditors’ Report
To the Board of Directors and the Minister of Advanced
Education, Innovation and Technology of British Columbia
We have audited the accompanying financial statements
of British Columbia Innovation Council, which comprise
the statement of financial position as at March 31, 2013,
the statement of operations, changes in net financial
assets and cash flows for the year then ended, and notes,
comprising a summary of significant accounting policies
and other explanatory information.
Management’s Responsibility for the Financial
Statements
Management is responsible for the preparation and fair
presentation of these financial statements in accordance
with Canadian public sector accounting standards, and
for such internal control as management determines is
necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to
fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit
in accordance with Canadian generally accepted auditing
standards. Those standards require that we comply with
ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on our
judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due
to fraud or error. In making those risk assessments, we
consider internal control relevant to the entity’s preparation
and fair presentation of the financial statements in order
to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of
accounting estimates made by management, as well
as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained in our
audit is sufficient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the financial statements present fairly, in
all material respects, the financial position of the British
Columbia Innovation Council as at March 31, 2013 and its
results of operations and its cash flows for the year ended
then ended in accordance with Canadian public sector
accounting standards.
Chartered Accountants
May 16, 2013
Burnaby, Canada
KPMG LLP | Chartered Accountants
Metrotower II, Suite 2400 – 4720 Kingsway
Burnaby, BC, Canada V6H 4N2
Telephone: (604) 527-3600
Fax: (604) 527-3636
Internet: www.kpmg.ca
KPMG LLP is a Canadian limited liability
partnership and a member firm of the KPMG
network of independent member firms affiliated
with KPMG International Cooperative (“KPMG
International”), a Swiss entity.
KPMG Canada provides services to KPMG LLP.
BC Innovation Council Annual Report 2012 | 2013 40
Combined Financial Statements of
BRITISH COLUMBIA INNOVATION COUNCIL
Year ended March 31, 2013
Financial Statements: BC Innovation Council
BC Innovation Council Annual Report 2012 | 2013 41
Financial Statements: BC Innovation Council
2
BRITISH COLUMBIA INNOVATION COUNCIL
Statement of Operations
Year ended March 31, 2013, with comparative figures for 2012
Budget 2013 2013 2012
Revenue:
Grants from the
Province of British Columbia $ 6,150,000 $ 6,150,000 $ 9,650,000
Program revenue (note 6) - 171,000 -
Other 147,000 163,327 10,649
Interest 125,000 127,444 113,105
Revenue from NRAS endowment - 3,139 568,138
6,422,000 6,614,910 10,341,892
Expenses (note 13):
Program expenses and disbursements:
Academic 1,326,321 1,350,077 2,352,942
Commercialization 3,382,888 3,781,535 5,159,759
Contribution to NRAS program 22,640 22,980 607,821
Premier’s Technology Council 425,000 352,386 326,845
Talent Development and Innovation - 1,530 624,637
Technology Awareness 247,127 212,704 267,183
General administration 1,018,024 892,123 1,001,257
6,422,000 6,613,335 10,340,444
Annual surplus - 1,575 1,448
Accumulated surplus, beginning of year 56,448,641 56,448,641 56,447,193
Accumulated surplus, end of year $ 56,448,641 $ 56,450,216 $ 56,448,641
See accompanying notes to the financial statements.
BC Innovation Council Annual Report 2012 | 2013 42
Financial Statements: BC Innovation Council (continued)
3
BRITISH COLUMBIA INNOVATION COUNCIL
Statement of Changes in Net Financial Assets
Year ended March 31, 2013, with comparative figures for 2012
Budget 2013 2013 2012
Annual surplus $ - $ 1,575 $ 1,448
Acquisition of tangible capital assets (50,000) (35,496) (13,081)
Amortization of tangible capital assets 70,000 40,987 47,575
Disposition of tangible capital assets - 4,519 -
Accumulated amortization of disposition - (3,041) -
20,000 8,544 35,942
Acquisition of prepaid expenses - (65,849) (87,402)
Use of prepaid expenses - 93,540 95,610
- 27,691 8,208
Change in net financial assets 20,000 36,235 44,150
Net financial assets, beginning of year 6,255,668 6,255,668 6,211,518
Net financial assets, end of year $ 6,275,668 $ 6,291,903 $ 6,255,668
See accompanying notes to the financial statements.
BC Innovation Council Annual Report 2012 | 2013 43
Financial Statements: BC Innovation Council (continued)
4
BRITISH COLUMBIA INNOVATION COUNCIL
Statement of Cash Flows
Year ended March 31, 2013, with comparative figures for 2012
2013 2012
Cash provided by (used in):
Operations:
Annual surplus $ 1,575 $ 1,448
Items not involving cash:
Amortization of tangible capital assets 40,987 47,575
Changes in non-cash operating working capital:
Accounts receivable 197,336 (175,157)
Prepaid expenses 27,691 8,208
Accounts payable and accrued liabilities 119,238 (138,588)
Deferred program revenues 10,518,746 55,790
10,905,573 (200,724)
Capital:
Purchase of tangible capital assets (35,496) (13,081)
Disposition of tangible capital assets 1,478 -
(34,018) (13,081)
Investing:
Purchase of investments (144,838,625) (26,950,502)
Proceeds on maturity of investments 158,710,616 27,031,029
Increase in deferred revenue
from NRAS endowment 958,991 425,444
14,830,982 505,971
Increase in cash & cash equivalents 25,702,537 292,166
Cash & cash equivalents (including restricted), beginning of year 1,103,512 811,346
Cash & cash equivalents (including restricted), end of year $ 26,806,049 $ 1,103,512
See accompanying notes to the financial statements.
BC Innovation Council Annual Report 2012 | 2013 44
Financial Statements: BC Innovation Council (continued)
5
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements
Year ended March 31, 2013, with comparative figures for 2012
1. Authority and purpose:
British Columbia Innovation Council (the “Council”), was established in 2006 by an amendment of
the Innovation and Science Council Act to the British Columbia Innovation Council Act (the “Act”).
The Council is governed by a Board of Directors, appointed by the provincial government of
British Columbia (the “Province”). The Council is exempt from the payment of income taxes under
section 149 of the Income Tax Act.
Under Section 13 of the Act, the directors, officers, and employees of the Council have certain
immunities in the exercise of their duties carried out in their connection with the Council.
The Council’s mandate is to support applied research and commercialization of science and
technology in order to foster province-wide economic development.
2. Significant accounting policies:
(a) Basis of accounting and presentation:
These financial statements are prepared in accordance with Canadian public sector
accounting standards as recommended by the Public Sector Accounting Board of the
Canadian Institute of Chartered Accountants.
(b) Cash and cash equivalents:
Cash and cash equivalents include investments with a term to maturity of 90 days or less at
the date of acquisition.
(c) Investments:
Investments, which include investments with original terms to maturity of greater than 90
days, are recorded at amortized cost plus accrued interest, which approximates market
value. Interest income is recognized in the period earned.
(d) Revenue recognition:
The Council follows the accrual method of accounting for contributions. Unrestricted
contributions and government grants are recorded as revenue when received or receivable, if
the amounts can be estimated and collection is reasonably assured. Other unrestricted
revenue, including sales of services and products, are reported as revenue at the time the
services are provided or the goods delivered.
Investment income on unrestricted assets is recognized as revenue when it is earned.
Endowment contributions are recognized as revenue when received. Investment income
earned from restricted cash and investments related to the endowment funds are deferred
and recognized as revenue when they are spent or disbursed in accordance with the
restrictions of the endowment.
BC Innovation Council Annual Report 2012 | 2013 45
Notes to Financial Statements for
BC Innovation Council
5
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements
Year ended March 31, 2013, with comparative figures for 2012
1. Authority and purpose:
British Columbia Innovation Council (the “Council”), was established in 2006 by an amendment of
the Innovation and Science Council Act to the British Columbia Innovation Council Act (the “Act”).
The Council is governed by a Board of Directors, appointed by the provincial government of
British Columbia (the “Province”). The Council is exempt from the payment of income taxes under
section 149 of the Income Tax Act.
Under Section 13 of the Act, the directors, officers, and employees of the Council have certain
immunities in the exercise of their duties carried out in their connection with the Council.
The Council’s mandate is to support applied research and commercialization of science and
technology in order to foster province-wide economic development.
2. Significant accounting policies:
(a) Basis of accounting and presentation:
These financial statements are prepared in accordance with Canadian public sector
accounting standards as recommended by the Public Sector Accounting Board of the
Canadian Institute of Chartered Accountants.
(b) Cash and cash equivalents:
Cash and cash equivalents include investments with a term to maturity of 90 days or less at
the date of acquisition.
(c) Investments:
Investments, which include investments with original terms to maturity of greater than 90
days, are recorded at amortized cost plus accrued interest, which approximates market
value. Interest income is recognized in the period earned.
(d) Revenue recognition:
The Council follows the accrual method of accounting for contributions. Unrestricted
contributions and government grants are recorded as revenue when received or receivable, if
the amounts can be estimated and collection is reasonably assured. Other unrestricted
revenue, including sales of services and products, are reported as revenue at the time the
services are provided or the goods delivered.
Investment income on unrestricted assets is recognized as revenue when it is earned.
Endowment contributions are recognized as revenue when received. Investment income
earned from restricted cash and investments related to the endowment funds are deferred
and recognized as revenue when they are spent or disbursed in accordance with the
restrictions of the endowment.
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 46
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 47
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
7
3. Investments:
Restricted and unrestricted investments consist of term deposits and guaranteed investment
certificates with maturity dates ranging from May of 2013 to November of 2014, bearing interest
at rates ranging from 1.45% to 2.55%.
Included in unrestricted investments are shares of previous BCASF program participant private
corporations received in exchange for all or a portion of loan or royalty interests. As at March 31,
2013, the Council has assessed these shares of privately-held corporations to have nominal
market value. As such, these investments are recorded at a nominal value of $1 each for each
company shareholding. The estimated market value of the long-term investments as at March 31,
2013 is $20 (2012 - $20).
4. Tangible capital assets:
Balance at Balance at
Cost March 31, 2012 Additions Disposal March 31, 2013
Furniture, fixtures and
equipment $ 155,567 $ - $ - $ 155,567
Computer hardware
and software 386,732 35,496 (4,519) 417,709
Leasehold improvements 27,770 - - 27,770
$ 570,069 $ 35,496 $ (4,519) $ 601,046
Accumulated
Accumulated Balance at amortization of Balance at
Amortization March 31, 2012 Amortization disposals March 31, 2013
Furniture, fixtures and
equipment $ 105,564 $ 10,000 $ - $ 115,564
Computer hardware
and software 310,042 30,987 (3,041) 337,988
Leasehold improvements 27,770 - - 27,770
$ 443,376 $ 40,987 $ (3,041) $ 481,322
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 48
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
8
4. Tangible capital assets (continued):
Net Book value Net book value
March 31, 2012 March 31, 2013
Furniture, fixtures and
equipment $ 50,003 $ 40,003
Computer hardware
and software 76,690 79,721
Leasehold improvements - -
$ 126,693 $ 119,724
There were no writedowns or reversals of writedowns previously recorded on any tangible capital
assets.
5. Accumulated surplus:
Accumulated surplus is comprised of the following:
2013 2012
Invested in tangible capital assets $ 119,724 $ 126,693
NRAS Endowment 50,000,000 50,000,000
Unrestricted 6,330,492 6,321,948
$ 56,450,216 $ 56,448,641
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 49
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
9
6. Deferred program revenues:
2013 2012
Balance, beginning of year $ 5,330,974 $ 5,275,184
LEEF contributions 10,607,332 -
Other contributions 1,518 -
Investment income (net of fees) 80,896 55,790
Less: amounts amortized to program revenues (171,000) -
Balance, end of year $ 15,849,720 $ 5,330,974
During the year the Council received $10,607,332 from Leading Edge Endowment Fund (LEEF),
a related entity (note 11). The funds were comprised of two deeds of gift in the amounts of
$2,250,000 designated to support the establishment of a Research Chair at a post secondary
institution in British Columbia and $7,000,000 designated to support and promote students at
British Columbia’s post secondary institutions. In addition, as part of a succession transfer
agreement, the Council received the residual assets and assumed the residual liabilities of LEEF
and received net financial assets in the amount of $107,332, and $1,250,000 to fund a
commitment previously made by LEEF to establish a BC Regional Research Chair at Thompson
Rivers University. The funds required for these future expenditures have been separated and
classified as restricted investments – deferred programs.
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 50
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
10
7. Natural Resources and Applied Science Research Endowment (NRAS):
In fiscal year 2005/2006, the Council was charged with stewarding an endowment contribution of
$50,000,000 from the Ministry of Economic Development. Investment earnings are restricted for
the support of training, research and development in natural resources and applied sciences.
Restricted cash and investments of $51,460,667 are comprised of the permanently restricted
endowment balance of $50,000,000 and unspent interest earnings of $1,460,667.
The deferred revenue from NRAS endowment balance is calculated as follows:
2013 2012
Unspent interest, beginning of year $ 501,676 $ 76,232
Annual interest earned 962,130 993,582
Administration and professional fees (3,139) (8,138)
Program expenditures - (560,000)
Unspent interest, end of year $ 1,460,667 $ 501,676
No program expenditures were made during the current year (2012 - $560,000).
8. Commitments and contingencies:
(a) The Council occupies offices under a long-term lease with varying terms to November 29,
2014. Minimum annual payments include the Council’s estimated share of utilities and other
costs of occupancy.
(b) The Council is committed to lease a photocopier until August 2013 at a quarterly rental of
$3,174.
Total estimated lease payments up to the end of the lease terms are as follows:
2014 $ 246,238
2015 164,619
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 51
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
11
9. Contractual obligations:
The Council has entered into a number of project grant contracts as at March 31, 2013 for the
future funding of research projects to be completed subsequent to the year end.
These contractual obligations are funded in installments and payments are due based on
conditions included in the contract being satisfied. As such, no liability has been accrued in the
financial statements as the Council is not liable for payments until these conditions have been
met.
The contractual obligations of the Council as at March 31, 2013 are $3,973,500 (2012 - $377,500).
10. Employee future benefits:
The Council and its employees contribute to the Public Service Pension Plan (the “Plan”) in
accordance with the Public Sector Pension Plans Act (the “Act”). The British Columbia Pension
Corporation administers the plan, including payment of pension benefits to employees to whom
the Act applies. As the Plan is a multi-employer, defined benefit plan, the Council accounts for its
payments on the basis of a defined contribution plan. Under joint trusteeship, the risk and reward
associated with the Plan’s unfunded liability or surplus is shared between the employers and the
Plan members and will be reflected in their future contributions. The most recent actuarial
valuation (March 31, 2011) indicated an unfunded liability of $275 million. The plan covers
approximately 53,500 active employees. The next required valuation will be as of March 31, 2014
with results available in 2015.
During the year, the Council paid and expensed $84,059 (2012 - $86,505) for contributions to the
Plan.
11. Related parties:
The Council is related through common ownership to all Province of British Columbia ministries,
agencies, Crown corporations, school districts, health authorities, hospital societies, universities
and colleges that are included in the provincial government reporting entity. Transactions with
these entities, unless disclosed otherwise, are recorded at the exchange amount, which is the
amount of consideration established and agreed to by the related parties.
During the year, the Council received $26,382 (2012 - $29,492) from LEEF as compensation for
operational expenses pertaining to accounting, administration and rent. These transactions were
in the normal course of operations and were measured at the exchange amount which is the
amount of consideration established and agreed to by the related parties. In addition, the Council
received $10,607,332 from LEEF (note 6).
BC Innovation Council Annual Report 2012 | 2013 52
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
12
12. Budget data:
The budget data presented in these financial statements is based on the 2013 operating budget
approved by the Board of Directors on May 14, 2012 and is reconciled to the statement of
operations as follows:
Approved Reconciling Statement
budget items of operations
Revenue:
Province of British Columbia $ 6,150,000 $ - $ 6,150,000
Program revenue - - -
Other 147,000 - 147,000
Interest 125,000 - 125,000
Revenue from NRAS endowment - - -
6,422,000 - 6,422,000
Expenses:
Academic 929,000 397,321 1,326,321
Commercialization 1,988,866 1,394,022 3,382,888
Contribution to NRAS program - 22,640 22,640
General administration 1,501,894 (483,870) 1,018,024
General program funds 1,378,915 (1,378,915) -
Premier’s Technology Council 425,000 - 425,000
Talent Development and Innovation - - -
Technology Awareness 198,325 48,802 247,127
6,422,000 - 6,422,000
$ - $ - $ -
Reconciling items are due to the allocation of costs in the general program funds and general
administration categories to the other functional categories as approved by the Board subsequent
to May 14, 2012.
BC Innovation Council Annual Report 2012 | 2013 53
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
13
13. Expenses by object:
The following is a summary of expenses by object:
2013 2012
Expenses:
Program expenses and disbursements $ 4,958,450 $ 7,998,477
Salaries and benefits 1,026,900 1,391,825
Rent 222,677 418,041
Contracted services 141,816 125,749
Office expenses 65,099 87,203
Other costs 157,406 271,574
6,572,348 10,292,869
Amortization 40,987 47,575
Total expense $ 6,613,335 $ 10,340,444
14. Comparative information:
Certain comparative information has been reclassified to conform with the financial statement
presentation adopted for the current year.
BC Innovation Council Annual Report 2012 | 2013 54
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
Notes to Financial Statements for
BC Innovation Council (continued)
BC Innovation Council Annual Report 2012 | 2013 55
Appendix A: Startup Growth Components
Concept
1. Early stage market research plan
2. Concept description PowerPoint
3. Product positioning statement(s)
4. One page strategic plan (next 12 months)
5. Product or technology focus
Research
6. Acquiring research customer(s) for market testing
7. Customer pain and demand assessment
8. Competitive analysis
9. Detailed market analysis
10. Business plan PowerPoint (business plan summary)
11. IP strategy (trademarks and patents)
12. Starting a company (trademark name, register
company, banking, tax numbers, licenses, permits,
company charter and bylaws)
13. Capital or corporate structure
14. Assembling core team
15. IRAP or other sources of government funding
(Futureworks, EBC, WD, SRED)
16. Tax jurisdictions (state, provincial, city, federal,
capital and permanent residence)
17. Statutory compliance (WCB, labor statutes,
licenses, taxes)
18. Compulsory requirements (insurance, bonding,
safety, environmental, standards)
19. Identification of the target customer
(ideal customer profile)
Proof of Concept
20. Secure alpha and beta customers
21. Product commercialization analysis
22. Prototype
23. Business plan
24. Detailed budget and finance plan
25. Key market identification and market size analysis
26. Marketing/sales plan
27. Angel investment PowerPoint
28. Operations
29. Revenue model
30. Pricing strategy
31. Product cost model
32. Warehousing and distribution models
Early Traction
33. Secure lead customer(s) (early adopters)
34. Operations plan
35. Business plan executive summary
36. Business plan
37. 1st or 2nd financing
38. Getting or ensuring the right people are “on the bus”
39. Key agreements: shareholders agreement,
employment, contracts, etc.
40. ESOP plan and tracking
41. Financing requirements
42. Financing plan
43. Financing presentation
44. Identify and introduce to sources of financing
(angels, VCs, strategic partners)
45. Debt versus equity analysis
Early -Stage Growth
46. Technology roadmap
47. Strategic selling and sales process
48. Sales funnel and management
49. Channels to market
50. Strategic partnerships
51. Marketing plan
52. Product roadmap
53. Branding statements
54. Sales plan
55. Exit strategy
Operations
56. Operations plan
57. Execution plans
58. Price elasticity and sensitivity/ability
to manage costs
59. Capital acquisitions versus leasing options
60. Risk assessments
61. Cross border transactions
62. Financial models
63. Budget and cash plan
64. Mission, vision and core values
65. Purchasing, supply chain and logistics strategy
66. Manufacturing or outsourcing strategy
67. Quality control and revision or batch management
9th Floor, 1188 West Georgia Street
Vancouver, BC V6E 4A2
Tel 604 683 2724
Fax 604 683 6567
email [email protected]
bcic.ca
doc_462333676.pdf
During on this detailed description amplify making bc a great place for technology entrepreneurs.
BC Innovation
Council
Annual Report
2012 | 2013
Making BC a great
place for technology
entrepreneurs
LIBRARY AND ARCHIVES CANADA CATALOGUING IN PUBLICATION DATA
BC Innovation Council.
Annual service plan report. — 2012/13 —
Annual.
Continues: Innovation and Science Council of British Columbia.
Annual service plan report.
ISSN 1718-2654 = Annual service plan report (BC Innovation Council)
Also available on the Internet.
1. BC Innovation Council - Periodicals.
2. Science and state - British Columbia - Periodicals.
3. Technology and state - British Columbia - Periodicals.
I. Title.
II. Title: BC Innovation Council…annual service plan report.
HC117.B74 354.2’745 C2006-960002-3
BC Innovation Council Annual Report 2012 | 2013 3
Message from the Chair
Jill Leversage,
Chair, BC Innovation Council
On behalf of the Board of Directors and the employees of BCIC, I am pleased to present our Annual Service Plan
Report for the fiscal year 2012/2013.
BCIC remained in a strong financial position at the end of fiscal 2012/2013, having unrestricted assets of $6.3 million.
Along with the funding it received from the Ministry of Advanced Education, Innovation and Technology, BCIC continued
to partner with federal and provincial government agencies, research institutions, industry and regional groups to carry
out programs and initiatives that align with our mandate.
BCIC is the Province’s lead agency with a mandate to grow British Columbia’s economy and create new rewarding
technology jobs by supporting technology entrepreneurs and accelerating technology commercialization. Working with
its network of partners across the province, BCIC funds and supports programs that advance new technology ventures
through well-defined stages to propel innovative new products beyond the idea stage into the global marketplace.
In 2012/2013, BCIC contributed a total of $6.6 million to community activities, including the launch of Venture
Acceleration Programs across the province, and the support of community events such as the Startup Canada
Campaign, the GROW technology conference and a technology summit. This total is in line with the forecast set out
in our 2012/2013 Service Plan.
In addition, BCIC met or exceeded all the targets set for our measures, a direct result of BCIC and partner efforts to
expand successful Venture Acceleration Programs across the province in the BCIC Acceleration Network. Partners such
as the Victoria Advanced Technology Council (VIATeC) and Northwest Science & Innovation retained business experts to
work with clients and greatly exceeded the targets they set for the year.
In 2012/2013, BCIC continued to work closely with its partners in industry and academia to deliver programs and
initiatives that develop entrepreneurial talent and promote the commercialization of technology.
In particular:
• Launched in September 2012, the largest BCIC commercialization initiative is BCAN, the BCIC Acceleration
Network. BCAN touches all corners of the province through regional partners funded by BCIC. The objective is to
deliver support to allow early-stage entrepreneurs to get their businesses launched. As part of BCAN, BCIC’s regional
partners deliver the Venture Acceleration Programs, which provide office space and a supportive environment for new
entrepreneurs. Executives-in-Residence, successful business professionals trained in the use of the program, help
new entrepreneurs through the earliest stages of their enrolment. In addition, the BCIC Mentor Program provides
ongoing mentoring through its volunteer mentors, providing assistance as the companies develop.
BC Innovation Council Annual Report 2012 | 2013 4
Message from the Chair (continued)
At the time of the launch, two partners had entered the Network and the program was available in the Okanagan and
Victoria. Since September, BCIC has secured additional partners in order to expand the program offerings throughout
the Lower Mainland, Fraser Valley, mid- and north- Vancouver Island, Sunshine Coast and the Central Interior.
• In partnership with Mitacs, a national not-for-profit research organization that develops the next generation of
innovators with vital scientific and business skills, BCIC launched the BCIC-Mitacs Commercialization Voucher
Program in 2012/2013.
A pilot program was designed to help British Columbia businesses rapidly bring their ideas and products to market.
The program enables companies to retain a graduate student from a British Columbia-based Post-Secondary
Research Institution for commercialization assessments of new products or services, or new market opportunities
for existing products or services.
Over the past 12 months, BCIC welcomed new team members to help BCIC execute on its mission. As of July 1, 2012, the
BCIC Board of Directors has been strengthened by the appointment of two members, Lorraine Larkin and Derek Lew. In
August, John Jacobson joined the team as President and CEO and made a valuable contribution during the remainder of
the fiscal year.
In 2012, BCIC transitioned its goals, measures and targets to reflect the recommendations from the Province’s 2011
Mandate Review of BCIC. The planning phase took place in 2012, and changes are underway for implementation in
the next fiscal year. BCIC’s refreshed mandate extends its activities into eight key industry sectors identified in the BC
Jobs Plan. BCIC is developing a Cross-Sector Strategy in 2013/2014 as a first step in broadening our focus to all eight
sectors.
In addition, the renewed mandate directed BCIC to change its funding process to improve transparency and
accountability. New program spending will be based on specific work plans developed and proposed by the funded
organization and will include appropriate measures of progress and outcomes. As a result, funding that BCIC
previously provided to some of its partners has ended and is being replaced with contribution agreements that outline
expectations.
Greater detail of BCIC’s activities over the past fiscal year can be found in the following pages of this 2012/2013 Annual
Service Plan Report.
Through leveraging of funds, knowledge and industry expertise, BCIC strives to maximize the value of every dollar spent.
BCIC’s existing resources are fully committed to Board-approved programs and initiatives. We are confident that the
dollars invested in programs for entrepreneurs in British Columbia will continue to yield results and, in turn, create more
job opportunities.
I would like to thank Ministry personnel for their strong support. I look forward to our continued conversations and
collaborations as we work towards building the best economic opportunities for British Columbians and strengthening
BCIC’s role in growing our economy.
Yours truly,
Jill Leversage
Chair, BCIC
June 5, 2013
BC Innovation Council Annual Report 2012 | 2013 5
The 2012/2013 BC Innovation Council Annual Service
Plan Report was prepared under the Board’s direction
in accordance with the Budget Transparency and
Accountability Act. The Board is accountable for the
contents of the report.
The information presented has been prepared in
accordance with the BC Reporting Principles and reflects
the actual performance of BCIC for the 12 months
ending March 31, 2013. The measures presented for
2012/2013 focus on aspects critical to the organization’s
performance and are consistent with BCIC’s mission,
goals and objectives in 2012/2013. The Board is
responsible for ensuring internal controls are in place
to confirm that performance information is measured
accurately and in a timely fashion.
All significant decisions, events and identified risks as of
March 31, 2013, have been considered in preparing the
report. The report contains estimates and interpretive
information that represent the best judgment of
management. Its contents are consistent with the
Government’s Letter of Expectations received from the
Province in 2012.
Any changes in mandate direction, goals, strategies,
measures or targets made since the 2012/13 – 2014/15
service plan were published in the 2013/2014 service
plan and any significant limitations in the reliability of
data are identified in the report.
Jill Leversage
Chair, BCIC
June 5, 2013
Accountability Statement
BC Innovation Council Annual Report 2012 | 2013 6
Message from the Chair 2
Accountability Statement 4
Organizational Overview 6
Enabling Legislation 6
Mandate 6
Vision 6
Mission 6
Values 7
Overview of Core Business Areas 8
BCIC Programs 8
Program Area: Entrepreneurial Talent Development and Retention 8
Program Area: Commercialization of Technology 9
Program Area: Technology Awareness 10
Benefits for British Columbians 11
Principal Partners, Clients and Stakeholders, Delivery of Services 12
Location 13
Corporate Governance 14
Role and Membership of the Board 14
The Board 14
Board Committees 15
Senior Management Team 15
Governance Principles 15
Governance Disclosure and Key Accountability Relationships 15
Report on Performance 16
Goals, Objectives, Key Strategies, Measures and Targets 16
Goal 1: Entrepreneurial Talent Development and Retention 17
Goal 2: Commercializing Innovative Technology 20
Goal 3: Increase Awareness of BC’s Knowledge Economy 22
Benchmarking 24
Management’s Confidence in Data Integrity 25
Opportunities and Challenges 25
Risk and Capacity Issues 25
Letter of Expectations and Letters of Direction From Government 26
Financial Report 32
Future Outlook 36
Statement of Management Responsibility 37
Signed Auditor’s Report 38
Financial Statements: BC Innovation Council 39
Notes to Financial Statements for BC Innovation Council 44
Appendix A: Startup Growth Components 54
Table of Contents
BC Innovation Council Annual Report 2012 | 2013 7
Enabling Legislation
The BC Innovation Council is a provincial Crown Agency
operating under the British Columbia Innovation Council
Act (Amended in Bill 15 - 2006).
Mandate
The provincial government has provided the following
direction to BCIC in order to ensure it fulfills its objectives:
• To advance commercialization in British Columbia
through focused support to startup companies and
facilitation of partnerships between industry and
academia;
• To work with partners and organizations that
support entrepreneurship and the development of
entrepreneurial talent;
• To work cooperatively with the BC Regional Science
and Technology Network (BCRSTN) offices and the
University Industry Liaison Offices (UILOs) operating in
the province;
• Incubate and develop key programs in partnership
with the Government and deliver programs through
well-established partners that use outcomes-based
reporting and transparent practices;
• Align BCIC’s Board governance model with the Board
Resourcing and Development Office (BRDO) policies
and best practices;
• Develop a new set of outcome-based performance
measures as part of a rigorous approach to planning
and evaluation, and extend these metrics to partner
selection and reporting;
• Diversify programming to expand entrepreneurship
programs and support in priority sectors as outlined in
the BC Jobs Plan; and
• Meet the financial and performance reporting
requirements set out in the Budget Transparency and
Accountability Act, the Financial Administration Act,
and the Financial Information Act.
Vision
Making British Columbia a great place for technology
entrepreneurs to access opportunities, training and
community.
Mission
BCIC accelerates the commercialization of technology
by funding venture acceleration programs that promote
and assist development of entrepreneurs and early stage
companies.
Organizational Overview
BC Innovation Council Annual Report 2012 | 2013 8
Values
BCIC’s core values guide its operations. They include:
• Collaboration – BCIC collaborates with partners to
create programs and provide support for initiatives
that develop entrepreneurs and promote the
commercialization of technology.
• Results – BCIC measures the contribution that our
programs and activities make to the province by
setting performance targets and measuring results.
We continually monitor our programs and services
with our partners and clients to ensure outcomes are
aligned with our mandate.
• Integrity – BCIC is committed to meeting the highest
standard of integrity expected by British Columbians
and Government alike. We follow fair and transparent
processes in all our activities and we pass the
obligation to do the same to all of the partners we
provide funding to.
• Entrepreneurial – BCIC promotes an entrepreneurial
spirit among those starting ventures in British
Columbia, and BCIC is committed to operating with the
same entrepreneurial spirit.
Organizational Overview (continued)
BC Innovation Council Annual Report 2012 | 2013 9
BCIC is the Province’s lead organization with a mandate
to encourage commercialization of technology in
British Columbia. Helping entrepreneurs get new and
innovative products into the global market enhances
British Columbia’s competitiveness and provides high
quality jobs for British Columbians. New companies and
ventures are the engine of job creation and the origin of
the future firms that anchor the economy. All of BCIC’s
programs and services support this important goal.
BCIC develops and funds programs which are delivered
across the province by regional economic development
organizations and academic institutions. This approach
enables BCIC to assure quality and consistency while
catering to the specific needs of technology entrepreneurs
based on their location, their industry sector and the stage
of development of their venture, be it the concept, idea
validation, pre-commercial or startup stage.
BCIC’s programs focus on economic sectors in which
British Columbia has a competitive advantage.
BCIC Programs
In 2012/2013, BCIC delivered initiatives under three
program areas to meet its mandate. The program areas
are as follows:
• Entrepreneurial Talent Development and Retention
• Commercialization of Technology
• Technology Awareness
Program Area: Entrepreneurial
Talent Development and
Retention
BCIC works with its program partners to help British
Columbians become successful entrepreneurs who
will build their companies in the province. BCIC funds
several programs that provide training to emerging
entrepreneurs as well early-stage entrepreneurs who are
working to commercialize their concepts. For example:
• entrepreneurship@SFU: created by BCIC, Dr. Ken
Spencer, SFU’s Faculty of Applied Sciences and the
Beedie School of Business in 2012. This initiative
provides a competitive academic pathway for third-
and fourth-year business and applied sciences
students and provides the skills, mentorship and
resources to build upon innovative ideas and develop
successful new ventures. Students are expected
to produce a business plan, design and prototype
their product/system, complete steps to launch a
successful business and obtain a lead customer.
They also take courses in business, engineering,
entrepreneurship, innovation and commercialization
and have access to mentorship from industry experts,
a scholarship award and other resources.
Key Achievements: Launched in January 2012,
the first two years of the program have placed 31
students in six teams that created business plans
and prototypes, and worked toward securing lead
customers, partners and investors as part of the
future launch of their companies.
Overview of Core Business Areas
Daniel Shapiro,
Dean, Beedie School of Business,
Simon Fraser University,
addresses attendees at the
entrepreneurship@SFU launch
BC Innovation Council Annual Report 2012 | 2013 10
• entrepreneurship@UVic: developed in 2009 by BCIC
in partnership with the University of Victoria, Wesley
Clover and the Alacrity Foundation, with support
from Western Economic Diversification Canada. This
incubator program offers engineering graduates
specialized entrepreneurship training, guidance and
mentorship from successful technology developers and
investors. Upon completion of the program students
receive Master’s degrees, entrepreneurship graduate
diplomas, and have developed their own companies.
Key Achievements: In the three academic years since
its launch in 2009, the program has trained a total of
10 students. Each cohort has created a company, for
a total of three companies. The first cohort graduated
in 2011 and their company, Yupiq, is rapidly growing
and in the process of receiving its second round of
funding from investors. Initially a team of four student
entrepreneurs, the company now employs seven people.
• BCIC-New Ventures Competition: BCIC partnered
with the New Ventures BC Society to deliver the
annual competition for emerging entrepreneurs that
has operated in British Columbia since 2001. This
technology idea competition is designed to provide
entrepreneurs with the tools and resources needed to
successfully take their ideas to the marketplace.
Key Achievements: The 2012 competition saw 146
applicants. Top prizes were awarded to an online
learning platform, a dental implant technology
provider and an online child caregiver search tool.
In total $235,000 was awarded in prizes - these
companies join more than 1500 program alumni over
12 years of competition.
A study released in February 2013 by the SFU’s Beedie
School of Business found that of companies that
advanced to the third round between 2001 and 2011
of the BCIC-New Ventures Competition:
– 56% are still active in some form and collectively
have created 3,170 jobs and generated an
estimated $194 million in revenue; and
– These ventures filed an estimated 854 patents and
generated 1,294 unique product offerings.
• The BCIC Mentor Program: a province-wide
entrepreneurial development program for founders
and CEOs of British Columbia technology ventures has
been offered by BCIC since its launch in 2011. Modeled
on the very successful MIT Venture Mentoring Service,
the BCIC Mentor Program adopts best practices from
ACETECH’s Growth Strategy Program, which delivers
tools and peer mentoring to CEOs of technology
companies in order to improve their effectiveness as
leaders. Program participants are early-stage startups
with a goal to progress and grow. By delivering
expert guidance and timely support in developing
their ventures, the program improves the success of
participating entrepreneurs and helps them take their
companies to the next level.
Key Achievements: Since its launch in January
2011, BCIC has recruited and trained 108 mentors,
and accepted 128 companies into the program. In
2012/2013, 61 mentors and 54 early-stage technology
CEOs and founders actively participated in the
program. On average, these early stage companies
support 6.7 jobs each.
Program Area: Commercialization
of Technology
BCIC’s goal of facilitating the commercialization of
innovative technology is supported by its network of
acceleration programs and programs that develop
entrepreneurial talent at the post-secondary level. For
example:
• In 2012/2013, BCIC launched the BCIC Acceleration
Network, a province-wide alliance of regional
partners delivering the Venture Acceleration Program,
Overview of Core Business Areas (continued)
Bill MacEwan,
Founder of SpaceList,
a participating company
in the 2012 BCIC-New
Ventures BC Competition
BC Innovation Council Annual Report 2012 | 2013 11
a structured venture growth program to technology
entrepreneurs across British Columbia. Through the
BCIC Acceleration Network, new and early-stage
technology companies throughout the province
gain access to highly qualified entrepreneurial
expertise and know-how. In 2012/2013 the program
was delivered in the Okanagan and Victoria. The
program was expanded later in the year through three
partnerships in the Lower Mainland as well as one
each in Kamloops and Nanaimo. Plans were set in
motion in to serve the West Kootenays by 2013/2014.
Key Achievements: Since its inception, the BCIC
Acceleration Network has engaged 102 companies
through five partners in the Lower Mainland, Fraser
Valley, Okanagan, Victoria, Vancouver Island, Sunshine
Coast and Central Interior regions. Collectively, since
engagement, these companies have added 273 full-
time jobs and attracted over $12 million in investment.
• BCIC launched the BCIC-Mitacs Commercialization
Voucher Program in 2012/2013 in partnership with
Mitacs, a national not-for-profit research organization
that develops the next generation of innovators with
vital scientific and business skills. A pilot program
designed to help British Columbia businesses rapidly
bring their ideas and products to market, the program
enables companies to retain a graduate student from
a British Columbia-based post-secondary research
institution for commercialization assessments of new
products or services, or new market opportunities for
existing products or services.
Key Achievements: During the pilot phase, the
Voucher Program received a total of 56 applications
from companies, 49 of which were matched with
appropriate student candidates and presented to BCIC
for review. Of the 49 applicants that were reviewed, 37
were approved. All funded projects are scheduled to
be completed by September 30, 2013.
• BCIC continued as the custodian of the $50 million
Natural Resources and Applied Science Research
Endowment (NRAS) originally provided by
Government in 2005/2006 to build research and
development, advanced training, technology transfer
and commercialization capacity in British Columbia
in engineering, natural resources and the applied
sciences. The first funding program to emerge from the
endowment was the NRAS Research Team Program,
developed collaboratively by BCIC and BCFRST in
2009. The endowment continues to earn interest
and, once sufficient interest has grown, BCFRST may
deliver further programs.
Key Achievements: The NRAS Research Team Program
competition received 102 applications in 2009 and
granted 24 awards for a total of $6.7 million. In
addition to the more than 50 researchers participating
on the teams, the projects involve high-calibre training
and supervision for 25 university students.
Program Area: Technology
Awareness
In support of all BCIC programs and initiatives, BCIC aims
to increase awareness of British Columbia’s science and
technology sectors domestically and internationally.
BCIC does this by linking British Columbia companies
to international growth opportunities as well as by
increasing awareness of the achievements of the British
Columbia technology community. For example:
• On March 15, 2013, BCIC and several partners from
British Columbia’s technology community presented
A Dialogue… Building and Sustaining BC’s
Technology Ecosystem. The event featured
presentations by several large technology companies
based in Vancouver. A panel involving several capacity
builders in British Columbia’s technology communities
and a keynote presentation provided opportunities for
the more than 200 attendees to participate in an open
dialogue. Attended by key decision makers including
Overview of Core Business Areas (continued)
Premier Christy Clark
attends A Dialogue…
Building and Sustaining
BC’s Technology
Ecosystem
BC Innovation Council Annual Report 2012 | 2013 12
community builders, CEOs, venture capitalists and
members of the provincial government, the event saw
an exchange of ideas between those who are making
British Columbia a great place to start and grow
technology companies.
• BCIC was the provincial ambassador for the 2012
Startup Canada Campaign, a nationwide tour
to celebrate and inspire entrepreneurship. BCIC
chaired the Startup Canada BC Steering Committee.
Working with more than 20 partners including
industry associations, support organizations and
entrepreneurs, the BC Steering Committee organized
events in seven British Columbia communities over
a two-week period in September 2012. The British
Columbia events drew more than 1,800 people from
sectors ranging from agri-tourism to technology,
with cultural backgrounds spanning immigrant
entrepreneurs to First Nations communities.
As a result of the national tour, Startup Canada
Communities was launched in May 2013. This pan-
Canadian network provides entrepreneurs with local
access to mentors, space, funding and support to
grow their businesses. Startup Canada Communities
is being piloted in 15 communities, including three in
British Columbia.
• In 2012, BCIC again supported metabridge, an
initiative that provides British Columbia technology
companies with direct connection and access to
key international technology partners for customer,
investment, strategic partnerships, mentorship and
advisory opportunities.
• BCIC was a silver sponsor of the annual GROW
conference again in 2012. Each year GROW brings
together more than 800 people among them founders,
investors, entrepreneurs, bloggers, developers,
designers and more. GROW has earned the reputation
of being Canada’s leading technology conference.
• BCIC partners with industry associations, regional
science and technology councils, academic institutions
and other organizations to identify and promote
technology success stories. The result is raised
awareness of British Columbia as a great place to start
and grow technology companies in all areas of the
province. Success stories published by BCIC in 2012
and instances of BCIC in the news can be found on the
BCIC website at www.bcic.ca/success-stories and www.
bcic.ca/bcic-in-the-news respectively. For example,
BCIC frequently features success stories of companies
in the BCIC Mentor Program such as Squeezease
Therapy’s success with its product SnugVest, created
for children and teens with autism and other sensory
disorders: www.bcic.ca/blog/2013/providing-a-firm-
hug-with-snug-vest-a-bcic-mentor-program-co.
Benefits for British Columbians
A fundamental function of BCIC is to accelerate the
development of the knowledge-based economy in
the province, directly leading to improved economic
performance for British Columbia. Within BCIC’s
mandate, this is accomplished by running programs
that increase the quantity of successful technology
entrepreneurs and companies. BCIC helps to create
new jobs and economic growth for the province by
building entrepreneurs and transforming research into
commercial ventures.
Overview of Core Business Areas (continued)
Donnie Ungaro (left)
and Michael Blonde (right):
Directors of metabridge 2012
Kerith Perreur-Lloyd and Sarah Doherty,
Founders of Sidestix.
Sidestix is an award holder of the
2010 BCIC-New Ventures BC Regional
Competition and the 2012 Mid-Island
Science and Technology Council (MISTIC)
Innovation Award.
BC Innovation Council Annual Report 2012 | 2013 13
Principal Partners, Clients
and Stakeholders, Delivery
of Services
BCIC designs, develops and implements many of its
programs and services in conjunction with its delivery
partners. All of its delivery partners are not-for-profit
organizations with a regional development focus or with
an affiliation with an educational institution.
BCIC also has a unique role in facilitating partnerships
between academia and industry to solve real world
problems through direct and applied research. Such
partnerships result in increased commercial activity.
BCIC also engages with federal and other provincial
government agencies, research institutions, industry and
regional groups to coordinate and enhance its programs.
In 2012/2013, BCIC maintained partnerships with more
than 20 organizations. Examples include accelerators such
as Accelerate Okanagan, Victoria Advanced Technology
Council and Wavefront; academic partners such as Simon
Fraser University and the University of Victoria; business
competition organizers such as New Ventures BC; and
regional technology councils such as Innovation Island
(formerly Mid-Island Science & Technology Innovation
Council) in Nanaimo and Kootenay Association for Science
& Technology in the West-Kootenay region.
Regions as defined by BCIC are indicated in the map in
Figure 1 below.
Overview of Core Business Areas (continued)
Figure 1: BCIC British Columbia Regions
BC Innovation Council Annual Report 2012 | 2013 14
Location
BCIC’s office is located at the Leading Edge Technology
Centre in downtown Vancouver in close proximity to
several key technology industry associations and
other complementary organizations. Locating in such
an environment allows BCIC further collaboration
opportunities.
The Leading Edge Technology Centre is on the
9th floor, 1188 West Georgia Street, Vancouver,
British Columbia V6E 4A2.
Overview of Core Business Areas (continued)
BC Innovation Council Annual Report 2012 | 2013 15
BCIC follows, and is in compliance with, the Board
Governance guidelines posted on the Board
Resourcing and Development Office (BRDO) website.
Role and Membership
of the Board
The Lieutenant Governor, through Order-in-Council,
appoints the members of BCIC’s Board, and delegates
the role of the Chair. The Board Chair reported to
the British Columbia Legislative Assembly through
the Minister of Advanced Education, Innovation and
Technology. The Board of Directors had seven members
in 2012/2013:
• Jill Leversage, Chair
• Jonathan Burke
• Gurval Caer
• Robin Ciceri
• Lorraine Larkin
• Derek Lew
• Cheryl Slusarchuk
The Board
• Sets the strategic direction and approves appropriate
plans from management;
• Recruits, empowers and monitors the executive
management;
• Shepherds and safeguards BCIC resources, approving
major financial decisions, ensuring internal controls
are in place and addressing areas of risk; and,
• Measures corporate performance, reporting regularly
to the stakeholders to ensure compliance with
applicable laws and ethical standards.
Corporate Governance
BC Innovation Council Annual Report 2012 | 2013 16
Corporate Governance (continued)
Purpose Committee Members
The Audit and Finance Committee helps the Board
fulfill its obligations and oversight responsibilities
relating to the audit process, financial reporting,
corporate control systems and risk management.
When required, it makes recommendations to the full
Board for approval.
Lorraine Larkin (Chair)
Jonathan Burke
Cheryl Slusarchuk
The Governance and Board Nomination Committee
reviews Board policies and practices, ensuring
BCIC fulfills its legislated mandate and implements
effective due diligence over BCIC’s governance.
The Full Board
The Human Resources and Compensation Committee
is a committee of the full Board that fulfils the Board’s
responsibilities with respect to BCIC’s staff policies
and practices.
The Full Board
Board Committees
Senior Management Team
• John Jacobson – President and CEO
• Jenny Choboter – CFO
• Paulin Laberge – Entrepreneur-in-Residence
• Dean Prelazzi – Managing Director,
BCIC Acceleration Network
• Lindsay Chan – Director of Communications
• Tomica Divic – Director of Operations
Governance Principles
BCIC’s Board has adopted the guiding principles outlined in
the Province of British Columbia’s Governance Framework
for Crown Corporations in establishing a framework from
which to operate. These principles include:
• Stewardship, leadership and effective functioning
of the Board
• Performance and value, innovation and continuous
improvement.
Governance Disclosure and Key
Accountability Relationships
BCIC’s governance documents and related disclosure
practices are available at www.bcic.ca/corporate-reports
where a full log and library of all documents related to
BCIC and its activities reside.
BCIC is a Crown Agency of the Province of British
Columbia. BCIC’s Annual Service Plans and Annual
Reports in fiscal year 2012/2013 were submitted to
the Ministry of Advanced Education, Innovation and
Technology.
BCIC works with program partners to provide input
on funded activities and program partners are
responsible for submitting regular reports to
BCIC regarding funded activities.
BC Innovation Council Annual Report 2012 | 2013 17
Goals, Objectives, Key Strategies,
Measures And Targets
BCIC Goals and Performance Measures
BCIC continues to work with industry, government
and the province’s academic institutions to identify
opportunities and gaps in its strategies directed
at developing entrepreneurs and promoting the
commercialization of technology. Once identified, BCIC
works with partners to address these needs through the
development and refinement of initiatives.
BCIC plays an integral role in helping shape the
development of British Columbia’s knowledge economy.
Because this role is fundamental for future job growth
and economic development in British Columbia, BCIC
considers it critical to have accurate performance
measures to track its progress in fulfilling its mandate.
Report on Performance
BC Innovation Council Annual Report 2012 | 2013 18
Goal 1: Entrepreneurial Talent Development & Retention
BUILDING BETTER ENTREPRENEURS FOR BRITISH COLUMBIA
BCIC works with its program partners to help British Columbians to become successful entrepreneurs.
Objective
• To improve early-stage commercialization skills of entrepreneurs in the British Columbia science and technology
community. Examples of these skills include business management, leadership, ability to communicate with
investors, customers and other stakeholders.
Strategies
• Identify and provide relevant knowledge and training to support early-stage entrepreneurs to commercialize their concepts.
• Partner with educational institutions and industry organizations to provide relevant knowledge and training for
emerging entrepreneurs.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 19
Report on Performance (continued)
MEASURE 1: ACTION PLANS FOR TECHNOLOGY ENTREPRENEURS
Description of Measure
This measure records the number of Action Plans
developed for and completed by early-stage
entrepreneurs by BCIC. An Action Plan is a document
describing strategies and next steps as recommended by
BCIC experts to improve entrepreneurs’ business plans,
enhance their skills and marketability and improve their
opportunities to gain access to capital funding.
Importance of Measure
An Action Plan provides expert advice to help budding
entrepreneurs understand what their “best and most
important next steps” are in the development of their
enterprises. A solid business foundation of key skill
sets is vital in the early stages of entrepreneurial
development – an area where the BCIC can provide
invaluable advice and guidance. Each technology
entrepreneur that receives an Action Plan will have a
much greater chance of commercial success, leading to
long-term business growth and higher quality jobs for
British Columbians.
Reason for Variance
This measure was exceeded because original estimates
by BCIC and several partner organizations were
conservative. Estimates are based on BCIC and partners’
ability to forecast demand for programs; the greater the
number of participants, the higher the number of Action
Plans that will be developed. BCIC has collected program
results in cooperation with our partner organizations
including the nine organizations that make up the BC
Regional Science and Technology Network and the six
University Industry Liaison Offices in the province. Some
partners experienced program growth as well as greater
demand than anticipated for programs. For example,
Simon Fraser University encountered greater demand
for its programs that resulted in twice the number
of Action Plans expected. As another example, the
University of Victoria increased its efforts to encourage
entrepreneurialism among students and faculty – as
a result, they also created twice as many Action Plans
as expected. The overall result is several hundred more
Action Plans over BCIC’s target.
* Measure has been retired as of 2013/2014. A new measure, titled Health Score of Ventures in the BCIC Acceleration
Network, is being implemented in 2013/2014 which includes the above as an indicator within a composite score.
The new measure considers several important elements for a venture to progress.
The number of Action Plans completed by BCIC for technology entrepreneurs that will directly advance
their early stage commercialization skills and improve their chances for commercial success
Past Performance 2012/2013 2013/2014
2010/2011 2011/2012 TARGET ACTUAL TARGET
463 815 463 834 n/a*
BC Innovation Council Annual Report 2012 | 2013 20
Report on Performance (continued)
MEASURE 2: SATISFACTION RATING OF BCIC’S PROGRAMS AND SERVICES
Description of Measure
This measure provides a percentage of the general
satisfaction BCIC clients have with BCIC’s programs. This
measure is based on sample surveys where satisfaction
is defined as a value of 7 or more on a 10-point
satisfaction scale. Performance targets are based on
similar past BCIC surveys.
Importance of Measure
Confirmation from entrepreneurs that BCIC-funded
programs enable their ventures to progress, adds
perspective to how BCIC measures its progress. BCIC’s
goal is to support programs that provide high value to
technology entrepreneurs, equipping them with the
knowledge and tools to advance their technologies.
Evaluation results enable BCIC to assess how well it is
delivering on its mission. Reports from the participants
of BCIC-supported programs and services will help to
shape, refine and improve BCIC offerings and position
BCIC as an integral component to the growth and
success of its client companies.
Reason for Variance
This measure was exceeded; however, it is noted that the
result for 2012/2013 is lower than the result for the year
prior. The reason for the lower result is the low ratings
attributed to one program, entrepreneurship@SFU. 2012
was the second year of this new program and BCIC is
taking steps to improve satisfaction with this program.
The target for this measure was based on observation
of past program satisfaction surveys; however, BCIC has
since developed a different grouping of programs than
when the targets were set. For example, past programs
included student events whereas current programs
focus on the training and development of entrepreneurs.
Future targets have been adjusted upward from the
previous forecast, based on results observed over the
last two years.
The percentage of BCIC clients who are satisfied that BCIC’s programs and services will help advance
the commercialization of their technology
Past Performance 2012/2013 2013/2014 2014/2015 2015/2016
2010/2011 2011/2012 TARGET ACTUAL TARGET TARGET TARGET
80% 93.66% 75% 82% 90% 90% 90%
BC Innovation Council Annual Report 2012 | 2013 21
Goal 2: Commercializing Innovative Technology
BUILDING INCUBATORS AND ACCELERATORS, AND FACILITATING PARTNERSHIPS BETWEEN ACADEMIA
AND INDUSTRY TO STRENGTHEN TECHNOLOGY COMMERCIALIZATION IN BRITISH COLUMBIA
BCIC supports programs and initiatives that help innovations reach the market. The net result will be a more vibrant
economy and more high quality jobs for British Columbians.
Objective
• To increase the number of new businesses in British Columbia’s technology sector.
• To increase the growth rate of small and medium-sized (SME) businesses in British Columbia’s technology sector.
Strategies
• Build a network of incubators inside educational institutions to train students to be entrepreneurs and launch
startup companies.
• Build a network of business accelerators to rapidly grow early-stage technology companies.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 22
Report on Performance (continued)
MEASURE 3: STARTUP GROWTH COMPONENTS ACHIEVED BY ENTREPRENEURS
Description of Measure
This measure captures key Startup Growth Components
(please see Appendix A for a complete list of these
Components) entrepreneurs need to accomplish to
effectively commercialize their concepts, paving the
way for their early-stage growth. These Components
can be customized to meet the unique needs of each
entrepreneur, for their specific industry sector or for
their company’s life stage. The following are examples
of Startup Growth Components: i) early-stage market
research plan, ii) IP strategy, iii) revenue model, iv) risk
assessments, v) financing plan and vi) strategic selling
and sales processes.
Importance of Measure
It is imperative that British Columbia is able to expedite
the commercialization of technology to increase
the province’s rate of economic growth as well as
its competitive advantage. To help accomplish this,
entrepreneurs need to have as many key Startup Growth
Components achieved as possible for a solid business
foundation for the success of their companies. The
higher the number of key Startup Growth Components
achieved by an entrepreneur, the greater their chance of
commercial success.
Reason for Variance
This measure was exceeded because original estimates
by BCIC and several partner organizations were
conservative. Estimates are based on BCIC and partners’
ability to forecast demand for programs; the greater
the number of participants, the higher the number of
Startup Growth Components that will be achieved. BCIC
has collected program results in cooperation with our
partner organizations including the nine organizations
that make up the BC Regional Science and Technology
Network and the six University Industry Liaison Offices
in the province. Some partners experienced program
growth as well as greater demand for programs than
anticipated. For example, VIATeC exceeded its target
by almost 500% because its Executive-in-Residence
worked with entrepreneurs to achieve milestones in a
timely manner. As another example, Northwest Science &
Innovation achieved twice its target because it retained
a business coach to work with clients in 2012/2013.
* Measure has been retired as of 2013/2014. A new measure is being implemented in 2013/2014 which includes the
above as an indicator within a composite score. The new measure considers several important elements for a venture
to progress.
The number of key Startup Growth Components achieved by entrepreneurs who have been directly supported
through BCIC’s programs and services
Past Performance 2012/2013 2013/2014
2010/2011 2011/2012 TARGET ACTUAL TARGET
1976 2100 1976 2700 n/a*
BC Innovation Council Annual Report 2012 | 2013 23
Goal 3: Increase Awareness of BC’s Knowledge Economy
Raising awareness of the knowledge economy in British Columbia and its vital role for the future growth of the province
is important. BCIC supports these activities by increasing the awareness of successful local technology companies and
by helping to position our province as a world class destination for international technology companies to establish a
presence.
Objective
• Increase awareness of British Columbia’s science and technology sectors and their achievements both domestically
and internationally.
Strategies
• Develop and promote success stories of British Columbia technology entrepreneurs through print, digital, broadcast
and social media, industry associations and other channels.
• Increase awareness of BCIC among British Columbia’s science and technology stakeholders.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 24
Report on Performance (continued)
MEASURE 4: TECHNOLOGY SUCCESS STORIES PROMOTED BY BCIC
Description of Measure
This measure captures the reach of British Columbia
technology success stories and is a count of the number
of stories placed by BCIC through print, digital, broadcast
and social media, industry associations and other
channels. Examples of success stories published by BCIC
in 2012 and instances of BCIC in the news can be found
on the BCIC website athttp://www.bcic.ca/success-
stories andhttp://www.bcic.ca/bcic-in-the-news
respectively. BCIC includes all technology success stories
issued by the organization as well as all instances of
the story being picked up by other sources (repeated or
re-written). This includes blog stories and media releases
picked up by digital, print and other sources. It does not
include mentions or tweets.
Importance of Measure
It is essential to increase the awareness of the economic
impact and success of British Columbia’s technology
companies to encourage new entrepreneurs, motivate
existing ones and to create an environment that supports
the growth of a knowledge economy. This will ultimately
lead to more commercial success stories, greater
employment in the sector and increased economic
benefits for the province.
Reason for Variance
BCIC worked closely in 2012/2013 with technology
start-up companies to develop compelling articles
on their successes. These articles were published on
BCIC’s website as well as through partner channels. For
example, VIATeC made a significant effort to promote
technology success stories and the recently launched
Tectoria brand. As a result, VIATeC surpassed its initial
target of 100 by placing 223 stories in 2012/2013. In
addition, Accelerate Okanagan exceeded its initial target
of 48, with a total of 130 success stories, due to the
strong engagement between its Marketing team and the
client ventures in its programs.
* Measure retired as of 2013/2014. Although BCIC continues to promote BC as a great place to be a technology
entrepreneur, BCIC’s goals and objectives for 2013/2014 are more focused on results than on activities
The number of technology success stories, promoted by BCIC, published through print, digital, broadcast
and social media, industry associations and other channels
Past Performance 2012/2013 2013/2014
2010/2011 2011/2012 TARGET ACTUAL TARGET
170 733 170 664 n/a*
BC Innovation Council Annual Report 2012 | 2013 25
Benchmarking
As BCIC reviews and develops its focus areas, it
continues to investigate similar jurisdictions that
are currently focusing on entrepreneurial talent
development and the commercialization of technologies.
In most cases this is a continuous process and activities
undertaken in 2012/2013 can be captured by the
standard benchmarking model in Figure 2.
Topics under consideration when consulting with or
monitoring other organizations include:
• Mentor and coaching methodologies – for example,
the BCIC Mentor Program is based on the MIT Venture
Mentor Service and BCIC regularly attends MIT’s user
group events in order to learn from the results of other
Program Leaders;
• Performance Measures – for example, BCIC compared
performance measures used by similar organizations
when refining its own performance measures;
• Venture engagement models
• Venture intake models/process
• Venture growth and development models
• Accelerator management models
• Funding models
• Types of community events other organizations are
running for the purpose of engaging the community
and encouraging/furthering entrepreneurship in the
community; and
• Publications released by or in connection with an
organization BCIC is monitoring.
BCIC is currently examining industry associations,
innovation councils, academic and private organizations
focusing on entrepreneurial talent development and the
commercialization of technologies. In addition, BCIC consults
with organizations involved with incubation, acceleration and
mentorship programs. Examples of organizations consulted
and monitored in 2012/2013 include:
• Alberta Innovates - Technology Futures
• Barcelona Activa
• Cambridge Innovation Centre
• Canadian Innovation Centre
• Chicago Innovation Mentors
• Communitech
• GrowLab
• Innovacorp
• Innovate St. Louis
• Innovation Place: Saskatchewan Opportunities
Corporation
• IRAP
• Jumpstart Inc.
• Launch Academy
• MaRS
• MIT Venture Mentor Service
• National Business Incubation Association
• Ontario Centre for Excellence – Centre for
Commercialization Research
• Saskatchewan Research Council
• SFU Venture Labs
• Techstars
• The Hub of Human Innovation
• Universidad Anáhuac
• Western Economic Diversification
Recognizing the dynamic nature of the technology
and startup landscape, BCIC continually monitors
developments in its focus area.
Report on Performance (continued)
Update Plan
Choose
Benchmarks
Measure Current
Performance
Compare
with Plan
Study
Similar Results
from Others
Compare
Results
Figure 2: Benchmarking Cycle
BC Innovation Council Annual Report 2012 | 2013 26
Management’s Confidence
in Data Integrity
BCIC’s performance management system is designed
to provide efficient and practical measurements
of BCIC’s goals. The measurements chosen are
quantifiable. This results-focused approach enables
BCIC to see when targets are met, objectives are
achieved and assess whether changes to programs
and strategies are necessary.
The success of BCIC programs are measured via
the following:
• Surveys: Issued to program participants by program
leaders via email on an annual basis, or more
frequently if appropriate.
• Progress Reports: BCIC gathers information via
progress reports submitted by program leaders.
Management is confident in the operational data
utilized in reporting the results of its activities. BCIC’s
sources of data include in-house records maintained
through electronic databases and progress reports
submitted by program partners. As a condition of
support to partners, BCIC requests appropriate records
be maintained and reported.
Data is collected throughout the year depending on the
activity and verified according to established reporting
guidelines to ensure consistency from past years and
across similar activities.
While accuracy is limited by human error, BCIC validates
questionable data as part of the monitoring process for
reports submitted externally.
Opportunities and Challenges
Subsequent to the review of BCIC’s mandate in 2011,
BCIC worked with Government in 2012/2013 to refresh
its mandate and align its goals, measures and targets.
Some changes were implemented during 2012/2013 and
the remainder of which were set in place for 2013/2014.
The renewed mandate also directed BCIC to change
its funding process to enhance transparency and
accountability. Revisions began in 2012/2013 to
ensure that new program spending is based on specific
work plans developed and proposed by the funded
organization, and will include appropriate measures
of progress and outcomes. As a result, funding that
BCIC previously provided as core funding to some of
its partners will end at the close of 2012/2013 and be
replaced with funding under contribution agreements
as described. BCIC focused effort in 2012/2013 to
communicate the effects of the changes to partners.
In 2012/2013 BCIC focused on programs that accelerate
the commercialization of technology through supporting
startups and the development of entrepreneurs. BCIC
activities are part of the continued movement toward
technology startup incubators and accelerators.
Risk and Capacity Issues
With growing fiscal restraint on BCIC’s funding sources,
annual funding levels have a significant impact on BCIC’s
operations. If there are further changes to the level of
funding BCIC receives from Government, BCIC’s ability
to leverage funds to finance projects, programs and
initiatives from other sources may be affected. Such
sources may include various organizations within the
federal and provincial governments as well as private,
public and not-for-profit science and technology
organizations.
Strategies to mitigate this risk include ongoing
communications with BCIC’s existing and potential
funding sources, in order to build awareness of the
level of support required. In addition, BCIC explores
the development and implementation of programs and
initiatives that are either self-supporting or leveraged
with other revenue generating sources.
Report on Performance (continued)
BC Innovation Council Annual Report 2012 | 2013 27
The Government’s Letter of Expectations (the Letter)
between the Ministry of Advanced Education, Innovation
and Technology (Government’s representative) and
BCIC is an agreement on the parties’ respective
accountabilities, roles and responsibilities. The Letter
confirms BCIC’s mandate and priority actions, articulates
the key performance expectations as documented
in the Government’s Expectations Manual for British
Columbia Crown Agencies[1], and forms the basis for
the development of BCIC’s Service Plan and Annual
Service Plan Report. The Letter does not create any legal
or binding obligations on the parties and is intended to
promote a co-operative working relationship.
As a result of the Mandate Review conducted by the
Province in 2011, BCIC was also provided with a Letter
of Direction in October, 2012 with specific guidance. In
addition, BCIC received a Letter of Direction regarding
use of Leading Edge Endowment Fund assets.
For the 2012/2013 fiscal year, Government directed BCIC
to take the following specific actions:
Letter of Expectations and
Letters of Direction From Government
Government’s Letter of Expectations for 2012/2013
Specific Directions from Government
i) Work in partnership with the Government to implement the approved recommendations outlined in the
2011/2012 British Columbia Innovation Council Mandate Review.
ii) Provide advice to the Minister, as requested, in support of the advancement of technology commercialization
and the entrepreneurial science and technology culture in British Columbia.
BCIC’s Response
i) Based on the observations of the Mandate Review Team, BCIC developed a set of Guiding Principles within
which BCIC began to operate in 2012/2013. They are listed below, along with a status update.
(continued on next page)
BC Innovation Council Annual Report 2012 | 2013 28
Letter of Expectations and
Letters of Direction From Government (continued)
Government’s Letter of Expectations for 2012/2013 (continued)
BCIC’s Response (continued)
KEY FOCUS – accelerate the commercialization of technology through supporting startups and the development
of entrepreneurs
BCIC has substantially eliminated all programs that do not meet this principle, while creating new programs and
expanding existing programs and activities that support the key focus. As an example, the BCIC Mentor Program
currently provides mentor services to 51 BC early-stage startups.
In 2012/2013, BCIC launched the BCIC Acceleration Network, a province-wide alliance of regional partners
delivering a structured venture growth program to technology entrepreneurs across British Columbia. Through the
BCIC Acceleration Network, new and early-stage technology companies throughout the province gain access to
highly qualified entrepreneurial expertise and know-how. In 2012/2013 the program was delivered in the Okanagan
and Victoria. The program was expanded later in the year through three partnerships in the Lower Mainland as well
as one each in Kamloops and Nanaimo. Plans were set in motion in to serve the West Kootenays by 2013/2014.
WORK WITH PARTNERS – both to plan and deliver programs and initiatives
BCIC continues to maintain and build relationships with program partners. In 2012/2013, BCIC had agreements
with more than 20 partners to deliver programs and initiatives. As the 2012 provincial ambassador for Startup
Canada, BCIC collaborated with and empowered 20 partners from throughout BC to deliver 15 entrepreneurship
development seminars and networking sessions in seven cities – Kelowna, Penticton, Victoria, Prince George,
Vancouver, North Vancouver and New Westminster.
CROSS-SECTOR – in line with the BC Jobs Plan
BCIC’s programs support technology companies whose products and services are fostering innovation across a
broad cross-section of industries, including all key industry sectors identified in the BC Jobs Plan.
In addition, BCIC initiated development of a Cross-Sector Strategy in 2012/2013 that will enable BCIC to diversify
programming into the priority sectors.
PROVINCE-WIDE – “demand led” access to programs and support
The BCIC Acceleration Network is an initiative that supports regional expansion of BCIC-funded activities. The
Network requires partners to assess program demand as part of the application process. BCIC is rolling out this
structured startup growth and mentorship program throughout British Columbia and in 2012/2013 already had
partners in place in Victoria, Kelowna, Nanaimo and Kamloops.
(continued on next page)
BC Innovation Council Annual Report 2012 | 2013 29
Government’s Letter of Expectations for 2012/2013 (continued)
BCIC’s Response (continued)
LEVERAGED FUNDING – required
In 2012/2013 BCIC collaborated with Southern Interior Development Initiative Trust and Northern Development
Initiative Trust to secure matching funding for BCIC Acceleration Network funding plans in regional centres. BCIC
Acceleration Network program funding is also partially supported by participant fees, corporate sponsorships and
other government funding. BCIC Acceleration Network program funding is also partially supported by participant
fees and corporate sponsorships. This model continues to be a priority as the BCIC Acceleration Network expands
throughout the province.
RESULTS-BASED FUNDING – no restricted or guaranteed “flow through” support
All newly agreed BCIC-supported programs and activities require regular and full reporting. Program agreements
are based on estimates of demand and agreed targets for delivery and results. In order for a partner to qualify for
repeat funding, they must report actual demand and performance results as compared with original estimates.
These results inform future funding and program design decisions.
INCUBATE PROGRAMS - create and launch before transferring to partners
In 2012, BCIC worked with regional partners to create and launch the BCIC Acceleration Network. BCIC intends
to transfer the Network’s governance to partners after one or more pilot years, provided a business model can be
developed that doesn’t create additional administrative burden that would detract from direct program spending.
TECHNOLOGY AWARENESS - focused on BCIC programs
BCIC promotes technology awareness by featuring BCIC programs through the BCIC blog and social media. In
2012/2013, BCIC has supported 11 partner events, posted 95 blog stories and issued 15 media releases. Externally,
BCIC has appeared in 24 news stories. BCIC is also active with social media including Twitter, Linkedin and
Facebook.
FULL MEASUREMENT - meaningful and accurate measurement and reporting
BCIC gathers information on the results and performance of the programs it supports. BCIC reviewed its existing
measures in 2012/2013 and developed new measures that capture relevant data. BCIC has developed three new
outcome-based measures for 2013/2014. All four measures used by BCIC for 2013/2014 serve to measure aspects
of participating companies’ ability to progress toward job creation.
ii) BCIC continues to provide feedback and advice to the Minister in support of technology commercialization
in the province.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 30
Letter of Direction from Government October 2, 2012
Key Sections in Letter of Direction BCIC’s Response
BCIC divest itself of all non-core responsibilities,
including Science Fairs and secondary school
programs;
BCIC has divested itself of all non-core responsibilities,
including Science Fairs and secondary school
programs. Many programs were transferred to relevant
organizations. For example, delivery of the Paul and
Helen Trussell Science & Technology Scholarship has
been assumed by the Vancouver Foundation. Delivery
of the 2012 Innovation Exploration program was
assumed by the Science Fair Foundation of BC.
Incubate and develop key programs in partnership with
AEIT and deliver programs through well-established
partners that use outcomes-based reporting and
transparent practices;
BCIC works with well-established partners to develop
and deliver key programs such as the Venture
Acceleration Program. All partner agreements include
the requirement to report on BCIC’s outcomes-based
measures. In addition, all partnerships are based on
proposals that provide insight into the practices of the
organization.
Align BCIC’s board governance model with Board
Resourcing and Development Office (BRDO) polices and
best practices;
BCIC continued in 2012/2013 to ensure consistency
with the Board Resourcing and Development Office
(BRDO) polices and best practices.
Develop a new set of outcome-based performance
measures as part of a rigorous approach to planning
and evaluation, and extend these metrics to partner
selection and reporting;
BCIC developed three new measures to be
implemented in 2013/2014. All four measures to
be used in 2013/2014 serve to measure aspects of
participating companies’ ability to progress toward job
creation. Partners explain during the selection process
how they will include data on the measures in their
reporting.
Diversify programming to expand entrepreneurship
programs and support in priority sectors as outlined in
the BC Jobs Plan;
BCIC developed a Cross-Sector Strategy for 2013/2014
that will enable BCIC to diversity programming into
priority sectors as outlined in the BC Jobs Plan. In
addition, the BCIC Acceleration Network is an initiative
that supports regional expansion of BCIC-funded
activities.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 31
Letter of Direction from Government October 2, 2012 (continued)
Key Sections in Letter of Direction BCIC’s Response
Set up a board structure compatible with other
Crown corporations, with an accompanying contract
for fulfilling the duties of a board director formalize
conflict-of-interest rules, and define board director
expectations and accountabilities, including
attendance and time commitment expected;
BCIC’s board structure is meeting these standards.
Work with BRDO to complete board recruitment,
ensuring the gaps in skills and competencies are taken
into account and BC Jobs Plan sectors are represented,
and deliver a formal on-boarding and orientation to
new board directors to ensure they understand their
role and accountabilities;
BCIC continues to work with BRDO to complete board
recruitment, on-boarding and orientation.
Recruit and select BCIC executives and staff using a
competency profile and a strong, transparent recruiting
process including references;
BCIC is following these standards in recruitment.
Work with the Public Service Employers Council and
BRDO to ensure compensation is appropriate for
the CEO; the board may need to undertake a market
compensation study in order to make a case for its
recommended salary range.
BCIC is working with the Public Service Employers
Council and BRDO to meet these standards.
Develop a performance contract for the CEO that
includes development and execution of an operating
plan that is directly a result of the strategic plan
to build the right organizational structure, roles,
competencies and capacity for a highly credible
organization;
BCIC developed a performance contract for the CEO
that meets these standards.
Develop a full strategic plan, including assumptions,
financial and economic information, external
socio-economic research, risks and specific risk
mitigation strategies, data from industry partners
and government (the shareholder’s expectations), and
AEIT’s strategic priorities and advice;
BCIC has a strategic plan in place.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 32
Letter of Direction from Government October 2, 2012 (continued)
Key Sections in Letter of Direction BCIC’s Response
Develop and formalize a process for funding partner
proposals that includes specific criteria, ideally
including a peer-review process, and hold the
executive team accountable for implementation
and measurement of satisfaction amongst key
stakeholders, such as industry partners, UILOs and
BCRSTN Councils;
BCIC formalized a process for funding partner
proposals in July 2012 and continues to review and
refine the process. Satisfaction of program participants
is monitored and BCIC has plans to measure
satisfaction of key partners.
Board to meet with AEIT officials in Fall 2012 to review
and follow up on the implementation of directives listed
above. Meetings with AEIT Executive and the BCIC
Board Chair and CEO should also occur on a quarterly
basis to discuss specific goals and performance
measures to be used in the upcoming Service Pan and
Service Plan Annual Reports.
BCIC met with AEIT officials in Fall 2012 continues to
meet on a quarterly basis with AEIT Executive.
Letter of Direction from Government (Re. Leading Edge Endowment Fund) March 27, 2013
Specific Direction
Allocate Leading Edge Endowment Fund assets to the BCIC-Mitacs Commercialization Voucher Program
BCIC’s Response
As custodian of the residual assets of the Leading Edge Endowment Fund (LEEF), BCIC allocated funds to the
pilot phase of the BCIC-Mitacs Commercialization Voucher Program. During the pilot phase, the Voucher Program
received a total of 56 applications form companies, 49 of which were matched with appropriate student candidates
and presented to BCIC for review. Of the 49 applicants that were reviewed, 37 were approved. All funded projects
are scheduled to be completed by September 30, 2013.
[1] The Province of British Columbia’s Crown Agency Accountability System (www.gov.bc.ca/caro/publications/index.html)
establishes guiding principles for the governance of Crown corporations. The Government’s Expectations Manual
identifies roles and responsibilities for the Government and Crown corporations, and provides for a Government’s
Letter of Expectations (Letter) to be developed.
Letter of Expectations and
Letters of Direction From Government (continued)
BC Innovation Council Annual Report 2012 | 2013 33
Management Discussion and Analysis
A summary of the BC Innovation Council’s financial results is presented below. Chart A details BCIC’s current operations,
with comparison to budget and the prior year’s figures. The chart includes the results of operations for the previous four
years as well as forecast figures for the next three years. Forecast figures are consistent with the 2013/14 Service Plan.
BCIC received less annual funding in 2012/2013 compared to the previous fiscal year and has adjusted its operations
accordingly. BCIC will continue to develop new programs under the renewed mandate and deliver programs in
collaboration with its partners across the province.
Financial Report
BC Innovation Council Annual Report 2012 | 2013 34
Financial Report (continued)
CHART A
Summary of financial results and budget projections
(in thousands
of dollars)
2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Actual Actual Actual Actual Actual Budget
Budget
Variance
Year
Variance Forecast Forecast Forecast
Revenues
Province of British
Columbia
9,293 8,500 8,500 9,650 6,150 6,150 - (3,500) 6,090 6,090 6,090
Internal Program
Funding (1)
6,390 2,195 29 - 171 - 171 171 5,500 2,000 2,000
NRAS Endowment (2) 3,005 2,109 1,919 568 3 1,000 (997) (565) 1,000 1,000 1,000
Interest and Other 562 275 329 124 291 115 176 167 125 125 125
Total Revenues 19,250 13,079 10,777 10,342 6,615 7,265 (650) (3,727) 12,715 9,215 9,215
Expenses
Programs and
Initiatives
12,597 7,943 6,349 7,430 4,956 3,826 1,130 (2,474) 9,977 6,466 6,459
NRAS Endowment (2) 3,005 2,109 1,919 568 3 1,000 (997) (565) 1,000 1,000 1,000
Salaries and Benefits 1,869 1,915 1,590 1,392 1,027 1,529 (502) (365) 1,192 1,192 1,192
Rent 227 254 274 418 223 280 (57) (195) 237 237 237
Amortization 64 74 62 48 41 70 (29) (7) 40 45 45
Other operating
costs (3)
1,488 784 583 485 364 560 (196) (121) 269 275 282
Total Expenses 19,250 13,079 10,777 10,341 6,614 7,265 (651) (3,727) 12,715 9,215 9,215
Annual Surplus 0 0 0 1 1 0 1 - 0 0 0
Funds Committed to
Future Programs (1)
13,866 11,722 11,722 11,780 22,300 11,780 10,520 10,520 16,800 14,800 12,800
Capital
Expenditures (4)
124 78 14 13 36 50 (14) 23 50 50 50
Total Debt 0 0 0 0 0 0 0 0 0 0 0
• The balance of Funds Committed to Future Programs includes unrestricted assets and deferred revenue balances.
Year-to-year changes include Annual Surplus (Deficit), changes to capital assets and deferred revenues as detailed
in Note 4 and Note 6 of the audited financial statements.
• NRAS program revenues and expenses are included in the financial chart above.
• Other operating costs include legal and contracted services, meeting, travel & networking and office expenses.
• Capital Expenditures include the costs of computer equipment and software licences.
• The above financial information, including forecast information, was prepared based on current Public Sector
Accounting Standards.
BC Innovation Council Annual Report 2012 | 2013 35
Natural Resources and Applied Sciences (NRAS) Research Endowment Fund
In the 2005/2006 fiscal year, BCIC was charged with stewarding $50 million from the Province of British Columbia for
the Natural Resources and Applied Sciences (NRAS) Research Endowment Fund. As an endowment, it is expected that
the capital will be preserved and only the interest earnings will be spent on program activities. In 2012/2013 $3,139 was
spent on professional services. Once sufficient interest earnings have accumulated, further programs can be delivered.
CHART B
Financial Report (continued)
Natural and Applied Sciences Endowment Fund
(in thousands
of dollars)
2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Actual Actual Actual Actual Actual Budget
Budget
Variance
Year
Variance Forecast Forecast Forecast
NRAS
Endowment Fund
50,000 50,000 50,000 50,000 50,000 50,000 - - 50,000 50,000 50,000
Interest Accumulated,
Begin of the year
4,273 3,031 1,209 76 502 502 - 426 1,461 1,461 1,461
Annual investment
income
1,763 287 786 994 962 1,000 (38) (32) 1,000 1,000 1,000
Program expenditures (3,000) (2,000) (1,800) (560) - (1,000) 1,000 560 (1,000) (1,000) (1,000)
Administration and
professional fees
(5) (109) (119) (8) (3) - (3) 5 - - -
Interest Accumulated,
End of the year
3,031 1,209 76 502 1,461 502 959 959 1,461 1,461 1,461
Total Debt 0 0 0 0 0 0 0 0 0 0 0
BC Innovation Council Annual Report 2012 | 2013 36
Assessment of Changes in Results and Reasons for
Significant Variances and Trends
Provincial funding had been reduced to $6.15 million
this year and is expected to be further reduced to
$6.09 million next year. The future provincial funding is
forecasted to be the same for the next three years.
In 2012, BCIC received two gifts, one of $7 million
and another of $2.25 million. A further succession
transfer occurred of $1.47 million from the Leading
Edge Endowment Fund (LEEF) and is held in its reserve
as deferred program revenues. In the same year, BCIC
entered into a contract with Mitacs to develop and
deliver the pilot BCIC-Mitacs Commercialization Voucher
Program for up to $1 million from the $7 million LEEF
gift. In 2012/2013, $171,500 had been disbursed for
this program, and BCIC will continue to disburse the
remaining of the $1 million as agreed in the contract
until it is fully exhausted.
In 2012/2013 $3,139 was spent on professional services
under the direction of BCFRST Foundation.
Interest and other income were higher this year due
to receipt of a holdback payment for the sale of UB
Video shares in the amount of US$151,004, which was
transferred from BC Advanced Systems Foundation to
BCIC on March 30, 2007.
Programs and Initiatives expenses were lower than
last year because provincial funding was reduced by
36%. However, total program expenses exceeded the
budget by 29% as BCIC strived to reduce its operating
cost and used the savings towards programs. BCIC
divested itself of all non-core programs and launched
two new programs to focus its effort in developing
commercialization initiatives that accelerate the
commercialization of technology and development of
entrepreneurs in British Columbia.
Operating and administration expenses were lower
this year. Salaries and benefits were lower than
budgeted because BCIC went through a staff reduction
in 2011/2012 and a few anticipated recruitments
included in 2012/2013 budget did not proceed due to the
reduction in annual funding. Rent expenses were lower
because BCIC leased less office space.
BCIC’s total expenses in 2012/2013 were $6.614 million
with a surplus of $1,575.
BCIC’s capital expenditures were primarily for computer
equipment and software licenses.
Major Risks and Opportunities that Affected
Financial Performance
BCIC’s operations are primarily funded by the core
funding from the Province, and any changes to the level
of provincial funding will have significant impact on
BCIC’s operations. Strategies to mitigate this risk include
ongoing communications with BCIC’s existing and
potential funding sources, in order to build awareness of
the level of support required. In addition, BCIC explores
the development and implementation of programs and
initiatives that are either self-supporting or leveraged
with other revenue generating sources. BCIC has access
to its significant reserves and will work closely with
Government on how to utilize these reserves for the
development of future programs and initiatives.
With the establishment of the Natural Resources and
Applied Sciences Endowment Fund, interest rate levels
are a significant factor in the fund’s income; the primary
goal of investing the endowment is preservation of
the principal. Sufficient interest earnings have to be
accumulated before further programs can be delivered.
Financial Report (continued)
BC Innovation Council Annual Report 2012 | 2013 37
While the current uncertain economic climate is a
continued concern, BCIC has a valuable leadership
role in the Province and is confident that support from
government and other funding sources will continue
at strong levels. BCIC will focus its efforts on designing,
developing and implementing its programs and services
in collaboration with its delivery partners. BCIC will
continue to leverage funds from multiple sources for
the purpose of building more efficient and valuable
programs. BCIC will explore opportunities to develop new
programs and expand existing programs in accordance
with funding levels.
“The rise of innovation matters to all of us... innovative
industries bring “good jobs” and high salaries to the
communities where they cluster, and their impact on the
local economy is much deeper than their direct effect.
Attracting a scientist or engineer triggers a multiplier
effect, increasing employment and salaries for those
who provide local services.”
—Enrico Moretti, The New Geography of Jobs
Future Outlook
BC Innovation Council Annual Report 2012 | 2013 38
The financial statements of BCIC are the responsibility of
management and have been prepared in accordance with
Public Sector Accounting Standards, consistently applied
and appropriate in the circumstances. The preparation
of financial statements necessarily involves the use of
estimates which have been made using careful judgment.
In management’s opinion, the financial statements
have been properly prepared within the framework of
the accounting policies summarized in the financial
statements and incorporate, within reasonable limits of
materiality, all information available up to June 1, 2013.
The financial statements have been reviewed by BCIC’s
Audit Committee and approved by the Board of Directors.
Management maintains and relies on a system of internal
controls designed to provide reasonable assurance
that assets are safeguarded, transactions are properly
authorized and recorded, and that reliable and relevant
financial information is available on a timely basis.
The financial statements have been examined by
independent external auditors. The external auditors’
responsibility is to express their opinion on whether
the financial statements, in all material respects, fairly
present BCIC’s financial position, results of operations and
cash flows in accordance with Public Sector Accounting
Standards. The Auditors’ Report, which follows, outlines
the scope of their examination and their opinion.
The Board of Directors, through the Audit Committee,
is responsible for ensuring that management fulfils its
responsibility for financial reporting and internal controls.
The Audit Committee, comprised of directors who are not
employees, meets regularly with the external auditors and
management to satisfy itself that each group has properly
discharged its responsibility to review the financial
statements before recommending approval by the Board
of Directors and appointment of external auditors.
The external auditors have full and open access to the
Audit Committee, with and without the presence
of management.
Supplementary Documents and Statements
The signed Auditors’ Report, Audited Financial Statements
and accompanying notes to the financial statements follow.
Jill Leversage
Chair, BCIC
June 5, 2013
Statement of Management Responsibility
BC Innovation Council Annual Report 2012 | 2013 39
Signed Auditor’s Report
Independent Auditors’ Report
To the Board of Directors and the Minister of Advanced
Education, Innovation and Technology of British Columbia
We have audited the accompanying financial statements
of British Columbia Innovation Council, which comprise
the statement of financial position as at March 31, 2013,
the statement of operations, changes in net financial
assets and cash flows for the year then ended, and notes,
comprising a summary of significant accounting policies
and other explanatory information.
Management’s Responsibility for the Financial
Statements
Management is responsible for the preparation and fair
presentation of these financial statements in accordance
with Canadian public sector accounting standards, and
for such internal control as management determines is
necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to
fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit
in accordance with Canadian generally accepted auditing
standards. Those standards require that we comply with
ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on our
judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due
to fraud or error. In making those risk assessments, we
consider internal control relevant to the entity’s preparation
and fair presentation of the financial statements in order
to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of
accounting estimates made by management, as well
as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained in our
audit is sufficient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the financial statements present fairly, in
all material respects, the financial position of the British
Columbia Innovation Council as at March 31, 2013 and its
results of operations and its cash flows for the year ended
then ended in accordance with Canadian public sector
accounting standards.
Chartered Accountants
May 16, 2013
Burnaby, Canada
KPMG LLP | Chartered Accountants
Metrotower II, Suite 2400 – 4720 Kingsway
Burnaby, BC, Canada V6H 4N2
Telephone: (604) 527-3600
Fax: (604) 527-3636
Internet: www.kpmg.ca
KPMG LLP is a Canadian limited liability
partnership and a member firm of the KPMG
network of independent member firms affiliated
with KPMG International Cooperative (“KPMG
International”), a Swiss entity.
KPMG Canada provides services to KPMG LLP.
BC Innovation Council Annual Report 2012 | 2013 40
Combined Financial Statements of
BRITISH COLUMBIA INNOVATION COUNCIL
Year ended March 31, 2013
Financial Statements: BC Innovation Council
BC Innovation Council Annual Report 2012 | 2013 41
Financial Statements: BC Innovation Council
2
BRITISH COLUMBIA INNOVATION COUNCIL
Statement of Operations
Year ended March 31, 2013, with comparative figures for 2012
Budget 2013 2013 2012
Revenue:
Grants from the
Province of British Columbia $ 6,150,000 $ 6,150,000 $ 9,650,000
Program revenue (note 6) - 171,000 -
Other 147,000 163,327 10,649
Interest 125,000 127,444 113,105
Revenue from NRAS endowment - 3,139 568,138
6,422,000 6,614,910 10,341,892
Expenses (note 13):
Program expenses and disbursements:
Academic 1,326,321 1,350,077 2,352,942
Commercialization 3,382,888 3,781,535 5,159,759
Contribution to NRAS program 22,640 22,980 607,821
Premier’s Technology Council 425,000 352,386 326,845
Talent Development and Innovation - 1,530 624,637
Technology Awareness 247,127 212,704 267,183
General administration 1,018,024 892,123 1,001,257
6,422,000 6,613,335 10,340,444
Annual surplus - 1,575 1,448
Accumulated surplus, beginning of year 56,448,641 56,448,641 56,447,193
Accumulated surplus, end of year $ 56,448,641 $ 56,450,216 $ 56,448,641
See accompanying notes to the financial statements.
BC Innovation Council Annual Report 2012 | 2013 42
Financial Statements: BC Innovation Council (continued)
3
BRITISH COLUMBIA INNOVATION COUNCIL
Statement of Changes in Net Financial Assets
Year ended March 31, 2013, with comparative figures for 2012
Budget 2013 2013 2012
Annual surplus $ - $ 1,575 $ 1,448
Acquisition of tangible capital assets (50,000) (35,496) (13,081)
Amortization of tangible capital assets 70,000 40,987 47,575
Disposition of tangible capital assets - 4,519 -
Accumulated amortization of disposition - (3,041) -
20,000 8,544 35,942
Acquisition of prepaid expenses - (65,849) (87,402)
Use of prepaid expenses - 93,540 95,610
- 27,691 8,208
Change in net financial assets 20,000 36,235 44,150
Net financial assets, beginning of year 6,255,668 6,255,668 6,211,518
Net financial assets, end of year $ 6,275,668 $ 6,291,903 $ 6,255,668
See accompanying notes to the financial statements.
BC Innovation Council Annual Report 2012 | 2013 43
Financial Statements: BC Innovation Council (continued)
4
BRITISH COLUMBIA INNOVATION COUNCIL
Statement of Cash Flows
Year ended March 31, 2013, with comparative figures for 2012
2013 2012
Cash provided by (used in):
Operations:
Annual surplus $ 1,575 $ 1,448
Items not involving cash:
Amortization of tangible capital assets 40,987 47,575
Changes in non-cash operating working capital:
Accounts receivable 197,336 (175,157)
Prepaid expenses 27,691 8,208
Accounts payable and accrued liabilities 119,238 (138,588)
Deferred program revenues 10,518,746 55,790
10,905,573 (200,724)
Capital:
Purchase of tangible capital assets (35,496) (13,081)
Disposition of tangible capital assets 1,478 -
(34,018) (13,081)
Investing:
Purchase of investments (144,838,625) (26,950,502)
Proceeds on maturity of investments 158,710,616 27,031,029
Increase in deferred revenue
from NRAS endowment 958,991 425,444
14,830,982 505,971
Increase in cash & cash equivalents 25,702,537 292,166
Cash & cash equivalents (including restricted), beginning of year 1,103,512 811,346
Cash & cash equivalents (including restricted), end of year $ 26,806,049 $ 1,103,512
See accompanying notes to the financial statements.
BC Innovation Council Annual Report 2012 | 2013 44
Financial Statements: BC Innovation Council (continued)
5
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements
Year ended March 31, 2013, with comparative figures for 2012
1. Authority and purpose:
British Columbia Innovation Council (the “Council”), was established in 2006 by an amendment of
the Innovation and Science Council Act to the British Columbia Innovation Council Act (the “Act”).
The Council is governed by a Board of Directors, appointed by the provincial government of
British Columbia (the “Province”). The Council is exempt from the payment of income taxes under
section 149 of the Income Tax Act.
Under Section 13 of the Act, the directors, officers, and employees of the Council have certain
immunities in the exercise of their duties carried out in their connection with the Council.
The Council’s mandate is to support applied research and commercialization of science and
technology in order to foster province-wide economic development.
2. Significant accounting policies:
(a) Basis of accounting and presentation:
These financial statements are prepared in accordance with Canadian public sector
accounting standards as recommended by the Public Sector Accounting Board of the
Canadian Institute of Chartered Accountants.
(b) Cash and cash equivalents:
Cash and cash equivalents include investments with a term to maturity of 90 days or less at
the date of acquisition.
(c) Investments:
Investments, which include investments with original terms to maturity of greater than 90
days, are recorded at amortized cost plus accrued interest, which approximates market
value. Interest income is recognized in the period earned.
(d) Revenue recognition:
The Council follows the accrual method of accounting for contributions. Unrestricted
contributions and government grants are recorded as revenue when received or receivable, if
the amounts can be estimated and collection is reasonably assured. Other unrestricted
revenue, including sales of services and products, are reported as revenue at the time the
services are provided or the goods delivered.
Investment income on unrestricted assets is recognized as revenue when it is earned.
Endowment contributions are recognized as revenue when received. Investment income
earned from restricted cash and investments related to the endowment funds are deferred
and recognized as revenue when they are spent or disbursed in accordance with the
restrictions of the endowment.
BC Innovation Council Annual Report 2012 | 2013 45
Notes to Financial Statements for
BC Innovation Council
5
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements
Year ended March 31, 2013, with comparative figures for 2012
1. Authority and purpose:
British Columbia Innovation Council (the “Council”), was established in 2006 by an amendment of
the Innovation and Science Council Act to the British Columbia Innovation Council Act (the “Act”).
The Council is governed by a Board of Directors, appointed by the provincial government of
British Columbia (the “Province”). The Council is exempt from the payment of income taxes under
section 149 of the Income Tax Act.
Under Section 13 of the Act, the directors, officers, and employees of the Council have certain
immunities in the exercise of their duties carried out in their connection with the Council.
The Council’s mandate is to support applied research and commercialization of science and
technology in order to foster province-wide economic development.
2. Significant accounting policies:
(a) Basis of accounting and presentation:
These financial statements are prepared in accordance with Canadian public sector
accounting standards as recommended by the Public Sector Accounting Board of the
Canadian Institute of Chartered Accountants.
(b) Cash and cash equivalents:
Cash and cash equivalents include investments with a term to maturity of 90 days or less at
the date of acquisition.
(c) Investments:
Investments, which include investments with original terms to maturity of greater than 90
days, are recorded at amortized cost plus accrued interest, which approximates market
value. Interest income is recognized in the period earned.
(d) Revenue recognition:
The Council follows the accrual method of accounting for contributions. Unrestricted
contributions and government grants are recorded as revenue when received or receivable, if
the amounts can be estimated and collection is reasonably assured. Other unrestricted
revenue, including sales of services and products, are reported as revenue at the time the
services are provided or the goods delivered.
Investment income on unrestricted assets is recognized as revenue when it is earned.
Endowment contributions are recognized as revenue when received. Investment income
earned from restricted cash and investments related to the endowment funds are deferred
and recognized as revenue when they are spent or disbursed in accordance with the
restrictions of the endowment.
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 46
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 47
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
7
3. Investments:
Restricted and unrestricted investments consist of term deposits and guaranteed investment
certificates with maturity dates ranging from May of 2013 to November of 2014, bearing interest
at rates ranging from 1.45% to 2.55%.
Included in unrestricted investments are shares of previous BCASF program participant private
corporations received in exchange for all or a portion of loan or royalty interests. As at March 31,
2013, the Council has assessed these shares of privately-held corporations to have nominal
market value. As such, these investments are recorded at a nominal value of $1 each for each
company shareholding. The estimated market value of the long-term investments as at March 31,
2013 is $20 (2012 - $20).
4. Tangible capital assets:
Balance at Balance at
Cost March 31, 2012 Additions Disposal March 31, 2013
Furniture, fixtures and
equipment $ 155,567 $ - $ - $ 155,567
Computer hardware
and software 386,732 35,496 (4,519) 417,709
Leasehold improvements 27,770 - - 27,770
$ 570,069 $ 35,496 $ (4,519) $ 601,046
Accumulated
Accumulated Balance at amortization of Balance at
Amortization March 31, 2012 Amortization disposals March 31, 2013
Furniture, fixtures and
equipment $ 105,564 $ 10,000 $ - $ 115,564
Computer hardware
and software 310,042 30,987 (3,041) 337,988
Leasehold improvements 27,770 - - 27,770
$ 443,376 $ 40,987 $ (3,041) $ 481,322
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 48
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
8
4. Tangible capital assets (continued):
Net Book value Net book value
March 31, 2012 March 31, 2013
Furniture, fixtures and
equipment $ 50,003 $ 40,003
Computer hardware
and software 76,690 79,721
Leasehold improvements - -
$ 126,693 $ 119,724
There were no writedowns or reversals of writedowns previously recorded on any tangible capital
assets.
5. Accumulated surplus:
Accumulated surplus is comprised of the following:
2013 2012
Invested in tangible capital assets $ 119,724 $ 126,693
NRAS Endowment 50,000,000 50,000,000
Unrestricted 6,330,492 6,321,948
$ 56,450,216 $ 56,448,641
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 49
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
9
6. Deferred program revenues:
2013 2012
Balance, beginning of year $ 5,330,974 $ 5,275,184
LEEF contributions 10,607,332 -
Other contributions 1,518 -
Investment income (net of fees) 80,896 55,790
Less: amounts amortized to program revenues (171,000) -
Balance, end of year $ 15,849,720 $ 5,330,974
During the year the Council received $10,607,332 from Leading Edge Endowment Fund (LEEF),
a related entity (note 11). The funds were comprised of two deeds of gift in the amounts of
$2,250,000 designated to support the establishment of a Research Chair at a post secondary
institution in British Columbia and $7,000,000 designated to support and promote students at
British Columbia’s post secondary institutions. In addition, as part of a succession transfer
agreement, the Council received the residual assets and assumed the residual liabilities of LEEF
and received net financial assets in the amount of $107,332, and $1,250,000 to fund a
commitment previously made by LEEF to establish a BC Regional Research Chair at Thompson
Rivers University. The funds required for these future expenditures have been separated and
classified as restricted investments – deferred programs.
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 50
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
10
7. Natural Resources and Applied Science Research Endowment (NRAS):
In fiscal year 2005/2006, the Council was charged with stewarding an endowment contribution of
$50,000,000 from the Ministry of Economic Development. Investment earnings are restricted for
the support of training, research and development in natural resources and applied sciences.
Restricted cash and investments of $51,460,667 are comprised of the permanently restricted
endowment balance of $50,000,000 and unspent interest earnings of $1,460,667.
The deferred revenue from NRAS endowment balance is calculated as follows:
2013 2012
Unspent interest, beginning of year $ 501,676 $ 76,232
Annual interest earned 962,130 993,582
Administration and professional fees (3,139) (8,138)
Program expenditures - (560,000)
Unspent interest, end of year $ 1,460,667 $ 501,676
No program expenditures were made during the current year (2012 - $560,000).
8. Commitments and contingencies:
(a) The Council occupies offices under a long-term lease with varying terms to November 29,
2014. Minimum annual payments include the Council’s estimated share of utilities and other
costs of occupancy.
(b) The Council is committed to lease a photocopier until August 2013 at a quarterly rental of
$3,174.
Total estimated lease payments up to the end of the lease terms are as follows:
2014 $ 246,238
2015 164,619
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
BC Innovation Council Annual Report 2012 | 2013 51
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
11
9. Contractual obligations:
The Council has entered into a number of project grant contracts as at March 31, 2013 for the
future funding of research projects to be completed subsequent to the year end.
These contractual obligations are funded in installments and payments are due based on
conditions included in the contract being satisfied. As such, no liability has been accrued in the
financial statements as the Council is not liable for payments until these conditions have been
met.
The contractual obligations of the Council as at March 31, 2013 are $3,973,500 (2012 - $377,500).
10. Employee future benefits:
The Council and its employees contribute to the Public Service Pension Plan (the “Plan”) in
accordance with the Public Sector Pension Plans Act (the “Act”). The British Columbia Pension
Corporation administers the plan, including payment of pension benefits to employees to whom
the Act applies. As the Plan is a multi-employer, defined benefit plan, the Council accounts for its
payments on the basis of a defined contribution plan. Under joint trusteeship, the risk and reward
associated with the Plan’s unfunded liability or surplus is shared between the employers and the
Plan members and will be reflected in their future contributions. The most recent actuarial
valuation (March 31, 2011) indicated an unfunded liability of $275 million. The plan covers
approximately 53,500 active employees. The next required valuation will be as of March 31, 2014
with results available in 2015.
During the year, the Council paid and expensed $84,059 (2012 - $86,505) for contributions to the
Plan.
11. Related parties:
The Council is related through common ownership to all Province of British Columbia ministries,
agencies, Crown corporations, school districts, health authorities, hospital societies, universities
and colleges that are included in the provincial government reporting entity. Transactions with
these entities, unless disclosed otherwise, are recorded at the exchange amount, which is the
amount of consideration established and agreed to by the related parties.
During the year, the Council received $26,382 (2012 - $29,492) from LEEF as compensation for
operational expenses pertaining to accounting, administration and rent. These transactions were
in the normal course of operations and were measured at the exchange amount which is the
amount of consideration established and agreed to by the related parties. In addition, the Council
received $10,607,332 from LEEF (note 6).
BC Innovation Council Annual Report 2012 | 2013 52
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
12
12. Budget data:
The budget data presented in these financial statements is based on the 2013 operating budget
approved by the Board of Directors on May 14, 2012 and is reconciled to the statement of
operations as follows:
Approved Reconciling Statement
budget items of operations
Revenue:
Province of British Columbia $ 6,150,000 $ - $ 6,150,000
Program revenue - - -
Other 147,000 - 147,000
Interest 125,000 - 125,000
Revenue from NRAS endowment - - -
6,422,000 - 6,422,000
Expenses:
Academic 929,000 397,321 1,326,321
Commercialization 1,988,866 1,394,022 3,382,888
Contribution to NRAS program - 22,640 22,640
General administration 1,501,894 (483,870) 1,018,024
General program funds 1,378,915 (1,378,915) -
Premier’s Technology Council 425,000 - 425,000
Talent Development and Innovation - - -
Technology Awareness 198,325 48,802 247,127
6,422,000 - 6,422,000
$ - $ - $ -
Reconciling items are due to the allocation of costs in the general program funds and general
administration categories to the other functional categories as approved by the Board subsequent
to May 14, 2012.
BC Innovation Council Annual Report 2012 | 2013 53
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
Notes to Financial Statements for
BC Innovation Council (continued)
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
13
13. Expenses by object:
The following is a summary of expenses by object:
2013 2012
Expenses:
Program expenses and disbursements $ 4,958,450 $ 7,998,477
Salaries and benefits 1,026,900 1,391,825
Rent 222,677 418,041
Contracted services 141,816 125,749
Office expenses 65,099 87,203
Other costs 157,406 271,574
6,572,348 10,292,869
Amortization 40,987 47,575
Total expense $ 6,613,335 $ 10,340,444
14. Comparative information:
Certain comparative information has been reclassified to conform with the financial statement
presentation adopted for the current year.
BC Innovation Council Annual Report 2012 | 2013 54
BRITISH COLUMBIA INNOVATION COUNCIL
Notes to Financial Statements (continued)
Year ended March 31, 2013, with comparative figures for 2012
6
2. Significant accounting policies (continued):
(d) Revenue recognition (continued):
Contributions externally restricted for non-capital specific purposes are recorded as deferred
revenue and recognized as revenue in the year in which the stipulations are met.
Investment income that is subject to external restrictions is deferred and recognized as
revenue in the year in which the related expense is incurred.
(e) Non-financial assets:
Non-financial assets are not available to discharge existing liabilities and are held for use in
the provision of services. They may have useful lives extending beyond the current year and
are not intended for sale in the ordinary course of operations.
(f) Tangible capital assets:
Tangible capital assets are initially recorded at cost which includes amounts that are directly
attributed to acquisition, construction, development or betterment of the asset. The historical
cost, less residual value, of the tangible capital assets is amortized commencing at the time
the asset is available for use based on the methods and rates as shown in the schedule
below:
Asset Amortization
Furniture, fixtures and equipment 20% declining balance
Computer hardware and software 33% declining balance
Leasehold improvements Straight line over the lesser of the term of
the lease and the useful life of the asset
(g) Employee future benefits:
The Council accrues employee vacation entitlements and post employment benefits. These
accruals are included in accounts payable and accrued liabilities. The Council is a member of
the Public Service multi-employer pension plan (note 10). Defined contribution plan
accounting is applied to the multi-employer defined benefit plan and, accordingly,
contributions are expensed when paid or payable.
(h) Use of estimates:
The preparation of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. The significant areas requiring
the use of management estimates include the determination of useful lives of tangible capital
assets for amortization and accrual of liabilities. Actual results may differ from these
estimates.
Notes to Financial Statements for
BC Innovation Council (continued)
BC Innovation Council Annual Report 2012 | 2013 55
Appendix A: Startup Growth Components
Concept
1. Early stage market research plan
2. Concept description PowerPoint
3. Product positioning statement(s)
4. One page strategic plan (next 12 months)
5. Product or technology focus
Research
6. Acquiring research customer(s) for market testing
7. Customer pain and demand assessment
8. Competitive analysis
9. Detailed market analysis
10. Business plan PowerPoint (business plan summary)
11. IP strategy (trademarks and patents)
12. Starting a company (trademark name, register
company, banking, tax numbers, licenses, permits,
company charter and bylaws)
13. Capital or corporate structure
14. Assembling core team
15. IRAP or other sources of government funding
(Futureworks, EBC, WD, SRED)
16. Tax jurisdictions (state, provincial, city, federal,
capital and permanent residence)
17. Statutory compliance (WCB, labor statutes,
licenses, taxes)
18. Compulsory requirements (insurance, bonding,
safety, environmental, standards)
19. Identification of the target customer
(ideal customer profile)
Proof of Concept
20. Secure alpha and beta customers
21. Product commercialization analysis
22. Prototype
23. Business plan
24. Detailed budget and finance plan
25. Key market identification and market size analysis
26. Marketing/sales plan
27. Angel investment PowerPoint
28. Operations
29. Revenue model
30. Pricing strategy
31. Product cost model
32. Warehousing and distribution models
Early Traction
33. Secure lead customer(s) (early adopters)
34. Operations plan
35. Business plan executive summary
36. Business plan
37. 1st or 2nd financing
38. Getting or ensuring the right people are “on the bus”
39. Key agreements: shareholders agreement,
employment, contracts, etc.
40. ESOP plan and tracking
41. Financing requirements
42. Financing plan
43. Financing presentation
44. Identify and introduce to sources of financing
(angels, VCs, strategic partners)
45. Debt versus equity analysis
Early -Stage Growth
46. Technology roadmap
47. Strategic selling and sales process
48. Sales funnel and management
49. Channels to market
50. Strategic partnerships
51. Marketing plan
52. Product roadmap
53. Branding statements
54. Sales plan
55. Exit strategy
Operations
56. Operations plan
57. Execution plans
58. Price elasticity and sensitivity/ability
to manage costs
59. Capital acquisitions versus leasing options
60. Risk assessments
61. Cross border transactions
62. Financial models
63. Budget and cash plan
64. Mission, vision and core values
65. Purchasing, supply chain and logistics strategy
66. Manufacturing or outsourcing strategy
67. Quality control and revision or batch management
9th Floor, 1188 West Georgia Street
Vancouver, BC V6E 4A2
Tel 604 683 2724
Fax 604 683 6567
email [email protected]
bcic.ca
doc_462333676.pdf