Information Bulletin 2—Preparing an IRB Transaction Sheet

The preparation of Industrial and Regional Benefits (IRB) transaction sheets is a key activity in the overall IRB process. An IRB transaction sheet is the document where an IRB Bidder/Contractor outlines the details of each business activity it proposes to undertake in Canada and to which it is prepared to commit contractually.

IRB transaction sheets are prepared at various stages of an IRB program. For example, bidders must prepare IRB transaction sheets to include in their IRB Proposal at bid submission. As well, following contract award, IRB Contractors prepare IRB transaction sheets for any newly proposed or amended IRB activities. While both instances use the same template and require the same information, bidders have the added risk that major errors on their IRB transaction sheets could result in bid non-compliance.

Outlined below is general guidance on preparing IRB transaction sheets. The guidance is structured in a "box by box" format, mirroring the IRB transaction sheet template provided by Innovation, Science and Economic Development Canada.

Disclaimer — Please note that this guidance is provided by the IRB Authority for general information purposes only. Bidders should base their IRB Proposals on the formal procurement documents that they receive with any Bidder Instructions (RFP). In addition, this guidance should not be seen as limiting in any way the assessments and decisions related to specific IRB Transaction sheets submitted for approval.

Box 1 — IRB Transaction Number

  • This is a routine administrative numbering process, entirely at the discretion of the IRB Bidder/Contractor.
  • Helpful hint: try to keep the numbering simple so it can be easily sorted and adjusted to the growing number of IRB transactions to come later on.

Box 2 — IRB Transaction Title

  • The transaction title is also entirely at the discretion of the IRB Bidder/Contractor.
  • The title is ideally short and to the point, but also informative about the nature of the IRB transaction.
  • Some good examples: "Acquire ship navigation system", "Technology transfer for manufacture of optical systems", "Consortia investment regarding radar systems R&D", "Investment at University X establishing a Research Chair".

Box 3a — Transaction Type

  • This box identifies whether a transaction is Direct, Indirect or Unallocated.
  • If the IRB transaction relates to a proposed Global Value Chain (GVC) activity, please indicate "Direct/GVC".

Box 3b — Banked Transaction

  • This box identifies whether the IRB transaction has already been approved and accepted into the IRB bank.
  • If no, indicate "no" in box.
  • If yes, then the:
    1. IRB transaction sheet must contain the exact information as was submitted to the IRB bank
    2. IRB transaction sheet must be accompanied by both the originally approved banked IRB transaction sheet and the signed letter of approval from the Innovation, Science and Economic Development Canada IRB Banker, and
    3. total of all banked IRB transaction sheets in the bidder’s IRB Proposal must not exceed 15 percent of the bid price.
  • Errors related to these three items may result in the rejection of the IRB transaction during bid evaluation.
  • If the IRB transaction is one where banking is only being requested, but has not yet been approved, there is an entirely separate process to be followed. All proposed banking transactions must be first submitted through the IRB banker.

Box 4 — Transaction Value

  • The information regarding IRB transaction value is to be provided in this box as requested.
  • Failure to insert any of the values may result in the rejection of the IRB transaction.
  • Innovation, Science and Economic Development Canada recognizes that values at this early stage are usually only a best estimate; therefore what is being sought are numbers that are reasonable and/or well-explained later in the IRB transaction sheet.
  • Numbers that do not seem reasonable and are not explained may not necessarily result in transaction rejection, but could lead to lower transaction scores.
  • Remember that all figures should be in Canadian dollars.
  • Specific guidance and examples appear below.

For IRB transactions involving the purchase of products or services:

"Total transaction value" = the total value of the contract or purchase order.

"% of CCV" = the percentage of the IRB recipient's product, service or activity which is Canadian.

"Total CCV" = a dollar value representation of the IRB recipient's CCV percentage factored into the total transaction value.

Example

The IRB Donor purchases $1M worth of machined parts from a Canadian recipient. The Canadian recipient’s products have an estimated CCV of 80 percent. Box 4 would look like:

Total transaction value: $1,000,000

% of CCV: 80 percent (some materials sourced off-shore)

Total CCV: $800,000

For more complex transactions (investments, technology transfers, consortia, etc):

"Total transaction value" = the total value of the actual investment by the IRB Donor.

"% of CCV" = the percentage of the recipient's product, service or activity which is Canadian (according to the CCV guidelines).

"Total CCV" = a dollar value representation of the recipient's CCV percentage factored into the investment, plus any applicable multiplier, share of future sales, etc.

Example 1

The IRB Donor invests $1M in a Canadian recipient to help the recipient buy new equipment for its production line. The Canadian recipient's product has an estimated CCV of 80 percent. The estimated future sales attributable to the new equipment are $10M over the length of the IRB Achievement Period. Box 4 would look like:

Total investment value: $1,000,000

% of CCV: 80 percent (some materials non-Cdn)

Total CCV: $9,000,000 ($10M future sales @ 80% + $1M investment)

Example 2

The IRB Donor invests $500,000 cash in a Canadian university for a research project. Box 4 would look like:

Total investment value:  $500,000

% of CCV: 100 percent

Total CCV: $2,500,000 (assuming 5x multiplier)

Box 5 — Sourcing Region

  • Indicate the city, province and region of the IRB recipient and/or the location of the work.
  • If there is more than one region with significant portions of the work, consider preparing separate IRB transaction sheets.

Box 6 — Small and Medium Business

  • Indicate whether the IRB recipient is a small and medium business.

Box 7 — Company providing IRB (Donor)

  • Insert the name of the company/division/entity that is actually undertaking the business activity in Canada.
  • The IRB Donor must be on the list of Eligible Parties (identified in the bid proposal or contract).
  • There should be only one donor per IRB transaction sheet.
  • Be sure to identify an appropriate contact name.
  • Errors in this section may result in IRB transaction rejection.

Box 8 — Company receiving IRB (Recipient)

  • The company receiving the IRB must be resident and operating in Canada.
  • With the exception of federal research institutes, the recipient cannot be a government organization.
  • There should be only one recipient per IRB transaction sheet.
  • Be sure to identify an appropriate contact name.
  • Errors in this section may result in IRB transaction rejection.

Box 9 — Industrial Sector and Expertise of IRB Recipient

  • Indicate the industrial sector of the IRB recipient.
  • Describe in concise terms the particular expertise of the IRB recipient.
  • If known, insert the Federal Supply Class (FSC) for the recipient's product or service. FSC is part of the NATO stock number system, which is used to collect procurement data.
  • FSC errors or omissions will not result in transaction rejection or lower scoring. However, correct FSC information will be sought from the IRB Contractor after contract award.

Box 10 — Description of IRB Recipient and IRB Transaction

  • Describe the IRB recipient in detail, including details such as business history, number of employees, locations in Canada, etc.
  • Provide a complete and detailed description of the proposed IRB activity, so that it is clear what is the:
    1. type of IRB activity being proposed (i.e. purchase of goods, consortia, technology transfer, etc.)
    2. location of the work in Canada
    3. nature of the work (design, manufacturing, support services, R&D, etc.)
    4. estimated quantities and timelines
    5. export market, platform or program involved (if applicable) and,
    6. any other relevant information.
  • Be specific and on point. Do not use generic statements or ones that appear in more than one IRB transaction sheet. Avoid marketing language.
  • Failure to adequately describe the IRB activity may result in transaction rejection.

Box 11 — Quality of IRB

  • Succinctly describe the quality of the proposed business activity, following the suggested points outlined in the IRB transaction sheet template.
  • Avoid generic statements or ones that appear in more than one IRB transaction sheet.
  • The factors that contribute to a high quality activity will vary from case to case. Highlight the one(s) that apply. Try to approach the quality description as if you were outlining a future success story.

Box 12 — Eligibility of IRB Transaction

  • Be as specific and detailed as possible in addressing each of the IRB eligibility criteria. Use and/or attach separate, additional sheets as required.
  • Whether the IRB transaction is submitted as part of a bid proposal, or after contract award, be sure to submit all details and supporting documentation with the IRB transaction sheet.
  • Do not use generic statements or ones that appear in more than one IRB transaction sheet. Avoid marketing language.
  • Failure to adequately demonstrate any of the IRB eligibility criteria may result in IRB transaction rejection.

Causality — Describe and demonstrate how the IRB transaction meets the causality criteria. Provide a detailed causality statement, and attach supporting documentation. Further information and guidance on causality can be found in the IRB Causality Guidelines on the IRB website.

Timing — Describe how the IRB transaction meets the timing criteria. Note that there are two elements to the timing criteria: i) activities must take place within the IRB Achievement period for a project and ii) IRB transactions proposed after contract award cannot include work that occurred prior to the identification of the IRB transaction to Innovation, Science and Economic Development Canada.

Incrementality — Address whether the IRB transaction does/does not involve a current supplier, whether a three-year average has/has not been applied, and if yes, which years are used.

Eligible Party — Describe how the IRB Donor meets the definition of Eligible Party and confirm that it is on the list of Eligible Parties.

Canadian Content Value (CCV) — Although not an eligibility criterion, CCV is included here to allow room to provide more details in two areas:

  1. IRB recipient's estimated CCV %:  Innovation, Science and Economic Development Canada is not seeking a detailed CCV breakdown on the IRB transaction sheet. However, the percentage plus a brief explanation (unusual CCV figures, source and reliability of the CCV, etc) should be provided.
  2. Basis of calculation for IRB credits on complex transactions: Innovation, Science and Economic Development Canada is seeking a brief explanation of how the proposed total CCV dollar value was determined.

Box 13 — Canadian Government Assistance

  • Indicate whether assistance from any level of government has been provided, either to the specific activity, the IRB Donor or the IRB recipient.
  • Note that the existence of government assistance does not automatically disqualify the activity as an IRB transaction. Innovation, Science and Economic Development Canada recognizes that business activities can have multiple partners.

Box 14 — Time Phasing of IRB Transaction

  • Complete the chart provided, adjusting the number of reporting periods to fit the particular contract.
  • Innovation, Science and Economic Development Canada recognizes that this information is an estimate only.
  • IRB transactions containing no time phasing information at all may be rejected.

Box 15 — Other Comments

  • Insert any additional comments or details that are relevant to the proposed activity.
  • For example, Box 15 is where an IRB Contractor could indicate whether there is potential for an increase in the IRB transaction value, or whether there are any co-dependencies with other IRB transactions.
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