Library and Archives Canada – Quarterly Financial Report

For the quarter ended December 31, 2017

Table of contents

Statement Outlining Results, Risks and Significant Changes in Operations, Personnel and Programs

1. Introduction

This quarterly report has been prepared by Library and Archives Canada (LAC) as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by Treasury Board. This quarterly report should be read in conjunction with the 2017–2018 Main Estimates and Supplementary Estimates (A) and (B).

This quarterly report has not been subject to an independent audit or review.

1.1 Library and Archives Canada’s mandate

Library and Archives Canada is an organization within the Canadian Heritage Portfolio. Created in 2004 under the Library and Archives of Canada Act, its mandate is as follows:

  • to preserve the documentary heritage of Canada for the benefit of present and future generations;
  • to be a source of enduring knowledge accessible to all, contributing to the cultural, social and economic advancement of Canada as a free and democratic society;
  • to facilitate in Canada co-operation among communities involved in the acquisition, preservation and diffusion of knowledge; and
  • to serve as the continuing memory of the Government of Canada and its institutions.

To manage service delivery and enhance its public profile, LAC has established four priorities in its Three-Year Plan 2016-2019, focused on high-quality services provided by expert, professional staff and supported by networking partnerships:

  1. LAC is an institution fully dedicated to serving all its clients: government institutions, donors, academics, researchers, archivists, librarians, students, genealogists and the general public.
  2. LAC is an institution which, drawing on the strength of its staff, is at the leading edge of archival and library science and new technologies.
  3. LAC is an institution proactively engaged with national and international networks in an open and inclusive way.
  4. LAC is an institution with prominent public visibility that highlights the value of its collection and services.

1.2 Basis of presentation

This quarterly report has been prepared by LAC using an expenditure basis of accounting. The accompanying Statement of Authorities includes the spending authorities granted by Parliament, and those used by LAC, consistent with the Main Estimates and Supplementary Estimates (A) and (B) for the 2017-2018 fiscal year. This quarterly report has been prepared using a special-purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.

The authority of Parliament is required before monies can be spent by the Government. Approvals are given in the form of annually approved limits through appropriation acts, or through legislation in the form of statutory spending authority for specific purposes.

When Parliament is dissolved for the purposes of a general election, section30 of the Financial Administration Act authorizes the Governor General, under certain conditions, to issue a special warrant authorizing the Government to withdraw funds from the Consolidated Revenue Fund. A special warrant is deemed to be an appropriation for the fiscal year in which it is issued.

LAC uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain prepared on an expenditure basis.

2. Highlights of fiscal quarter and fiscal year to date results

2.1 Statement of Authorities

As reflected in the Statement of Authorities below, total authorities available for use as of December 31 are $130.8 million in 2017–2018, and $122.3 million in 2016–2017. The following table presents the detailed list of authorities by fiscal year:

Table 1: list of authorities by fiscal year

Statement of Authorities (unaudited)
(in dollars)

For each Authority (Vote/Statutory), this table indicates the description of vote or authority, and the dollar figure, for the quarters ended December 31, 2017, and December 31, 2016.

Authority Vote/Statutory Description For the quarter ended December 31, 2017 For the quarter ended December 31, 2016
Vote 1 Operating Expenditures

106,501,739

100,261,830

Vote 1 Revenue credited to the vote

(550,000)

(550,000)

Vote 5 Capital Expenditures

14,397,864

12,541,607

Statutory Spending of proceeds from the disposal of surplus Crown assets

16,320

30,123

Statutory Contributions to employee benefit plans

10,406,462

10,015,218

Total authorities

 

130,772,385

122,298,778

The overall increase of $8.5 million results from the following:

  • An increase of $6.5 million related to funding eligible for retroactive payments from previous fiscal years and the current fiscal year in relation to negotiated salary adjustments;
  • an increase of $2.2 million in operating budget carry-forward and capital budget carry-forward;
  • An increase of $1.7 million to acquire, process, preserve and make available the private records of the Right Honourable Stephen Harper;
  • a decrease of $1.1 million following adjustments to the budget, to reflect the anticipated spending plan;
  • a decrease of $0.6 million for Budget 2016 reductions for professional services, travel and advertising; and
  • A decrease of $0.2 million for the foundational documents exhibit at the Library of Parliament to mark Canada’s 150th anniversary of Confederation.

2.2 Statement of departmental budgetary expenditures by standard object

As presented in the Statement of Departmental Budgetary Expenditures by Standard Object, the year-to-date expenditures total $90.0 million as of December 31, 2017, and $77.2 million as of December 31, 2016. The total increase of $12.8 million is mainly explained by the following:

  • an increase of $8.4 million ($64.5 million in 2017–2018 compared with $56.1 million in 2016–2017) in “Personnel” expenditures, attributable to retroactive payments from previous years and from the current year following the  negociated salary adjustments;
  • an increase of $3.3 million ($8.1 million in 2017–2018 compared with $4.8 million in 2016–2017) in “Other subsidies and payments” expenditures, mostly attributable to payments related to the management and maintenance of special-purpose buildings; a reallocation under the appropriate standard object will be carried out in the subsequent period in order to reflect the adequacy of the expenditures ;
  • a net increase of $1.1 million in departmental expenditures outlined below is attributable to payments related to the management and maintenance of special‑purpose buildings:
    • an increase of $1.8 million ($3.8 million in 2017–2018 compared with $2.0 million in 2016–2017) in “Rentals” expenditures;
    • an increase of $1.1 million ($1.7 million in 2017–2018 compared with $0.6 million in 2016–2017) in “Utilities, materials and supplies” expenditures;
    • a decrease of $1.8 million ($3.2 million in 2017–2018 compared with $5.0 million in 2016–2017) in “Repair and maintenance” expenditures.

In 2017–2018, certain expenditures were made during the first three quarters, while they were made during the fourth quarter in 2016–2017. Also, in 2017–2018, the expenditures were recorded under the appropriate standard object while 2016–2017 expenditures were re-allocated according to their nature during the fourth quarter.

3. Risks and uncertainties

Library and Archives Canada (LAC) developed an organizational risk profile for 2015-2018 that identifies strategic and organizational risks. It evaluates their consequences and potential impacts and determines the methods to be implemented in order to mitigate the risks. In addition, a semi-annual review of each mitigation strategy is conducted to assess the evolution of each risk. The following section provides a description of these strategic risks and their contexts.

Key Risks:

  1. Risk that Canadian documentary heritage of national interest is not acquired
    Given the ever-increasing quantity of information created via new technologies and the speed at which this information can disappear, LAC runs the risk of not acquiring all Canadian documentary heritage of national interest.
  2. Risk that documentary heritage is not preserved for present and future generations
    LAC must ensure the integrity and long-term accessibility of the documentary resources acquired. The integrity of the material can be compromised by a variety of external risk factors, such as deterioration over time and with use, and obsolescence of the technologies needed to consult formats. The loss of technical expertise and the lack of space for storage are considered internal risk factors.
  3. Risk that documentary heritage is not accessible
    Despite technological advances and the desire of Canadians for access to online content, much of LAC's collection is on paper or other analogue media. The time and effort needed to digitize it, make it discoverable and make it available online are such that LAC must target its efforts to digitize and provide access to content.
  4. Risk that Government of Canada institutions do not use regulatory instruments and recordkeeping tools developed by LAC
    The quantity of information created in the government on a daily basis poses a considerable challenge when it comes to identifying records that have administrative, legal or historical value. Proactive management of government information is essential, and ensures the government's accountability, and sound information management.

Departments and individuals across government have been affected by the implementation of the new government-wide Pay Modernization Project (Phoenix). LAC is mainly concerned about the substantial additional manual work following the introduction of this new pay system. To minimize impacts on employees, LAC’s integrated Phoenix team, comprised of compensation, finance, human resource system and staffing specialists, has developed and implemented interim solutions to address system issues. LAC has established processes to address outstanding service requests as quickly as possible. Additional resources have been hired since the implementation of Phoenix, to address the additional workload and to monitor and resolve outstanding issues.

4. Significant changes in relation to operations, personnel and programs

There were no significant changes to operations, personnel and programs in the third quarter ended December 31, 2017.

Approval by Senior Officials

Original signed by:

________________________________
Guy Berthiaume
Librarian and Archivist of Canada
Gatineau, Canada
February 23, 2018

_______________________________
Anick Ouellette, CPA, CA
Assistant Deputy Minister, Corporate
Services and Chief Financial Officer
Library and Archives Canada
Gatineau, Canada
February 13, 2018

Table 2: Statement of Authorities (unaudited)

(in dollars)

This table indicates dollar figures for authorities for the fiscal year 2017–2018, including the total available for use for the year ending March 31, 2018; the total used during the quarter ended December 31, 2017; and the total year to date used at quarter-end. Displayed are the dollar figures for fiscal year 2016–2017, including the total available for use for the year ending March 31, 2017; the total used during the quarter ended December 31, 2016; and the total year to date used at quarter-end.

Authorities Fiscal year 2017-2018: Total available for use for the year ending March 31, 2018 * Fiscal year 2017-2018: Used during the quarter ended December 31, 2017 Fiscal year 2017-2018: Year to date used at quarter-end Fiscal year 2016-2017: Total available for use for the year ending March 31, 2017 * Fiscal year 2016-2017: Used during the quarter ended December 31, 2016 Fiscal year 2016-2017: Year to date used at quarter-end
Vote 1 - Operating Expenditures

105,951,739

25,050,675

79,975,659

99,711,830

19,693,997

66,164,029

Vote 5 - Capital Expenditures

14,397,864

821,774

2,272,589

12,541,607

2,921,166

3,552,959

Contributions to the employee benefit plans

10,406,462

2,579,824

7,739,474

10,015,218

2,503,804

7,511,414

Spending of proceeds from the disposal of surplus Crown assets

16,320

0

0

30,123

15,000

15,000

Total budgetary authorities

130,772,385

28,452,273

89,987,722

122,298,778

25,133,967

77,243,402

Non-budgetary authorities

0

0

0

0

0

0

Total authorities

130,772,385

28,452,273

89,987,722

122,298,778

25,133,967

77,243,402

* Includes only Authorities available for use and granted by Parliament at quarter-end.

Table 3: Departmental Budgetary Expenditures by Standard Object (unaudited)

(in dollars)

This table indicates departmental budgetary expenditures. Displayed are the dollar figures for expenditures by standard object; total gross budgetary expenditures; total gross budgetary expenditures less revenues netted against expenditures; and total net budgetary expenditures for fiscal year 2017-2018; numbers are arranged by total planned expenditures for the year ending March 31, 2018; the total expended during the quarter ended December 31, 2017; and the total year to date used at quarter-end.

Displayed are the dollar figures for expenditures by standard object; total gross budgetary expenditures; total gross budgetary expenditures less revenues netted against expenditures; and total net budgetary expenditures for fiscal year 2016-2017; numbers are arranged by total planned expenditures for the year ending March 31, 2017; the total expended during the quarter ended December 31, 2016; and the total year to date used at quarter-end.

Fiscal year 2017-2018: Planned expenditures for the year ending March 31, 2018 Fiscal year 2017-2018: Expended during the quarter ended December 31, 2017 Fiscal year 2017-2018: Year to date used at quarter-end Fiscal year 2016-2017: Planned expenditures for the year ending March 31, 2017 Fiscal year 2016-2017: Expended during the quarter ended December 31, 2016 Fiscal year 2016-2017: Year to date used at quarter-end
Expenditures:
Personnel

83,089,323

21,061,963

64,480,886

68,243,232

19,097,675

56,065,551

Transportation and communications

959,270

295,692

679,718

1,221,545

302,816

739,587

Information

801,777

50,354

196,691

360,106

97,648

331,156

Professional and special services

17,610,366

3,592,266

6,379,883

28,487,526

3,523,474

5,630,669

Rentals

6,089,402

1,583,104

3,817,377

2,706,219

179,269

1,973,611

Repair and maintenance

13,796,378

378,438

3,190,212

12,569,266

2,731,233

5,039,775

Utilities, materials and supplies

765,846

1,360,494

1,686,826

1,260,356

270,028

620,335

Acquisition of land, buildings and works

0

0

0

0

0

0

Acquisition of machinery and equipment

779,478

187,756

476,940

445,855

562,668

836,790

Transfer payments

1,542,400

0

1,320,344

1,540,000

0

1,305,134

Other subsidies and payments

5,888,145

136,451

8,075,800

6,014,673

(1,596,606)

4,807,716

Total gross budgetary expenditures

131,322,385

28,646,518

90,304,677

122,848,778

25,168,205

77,350,324

Less Revenues netted against expenditures:
Respendable revenue

550,000

194,245

316,955

550,000

34,238

106,922

Total Revenues netted against expenditures

550,000

194,245

316,955

550,000

34,238

106,922

Total net budgetary expenditures

130,772,385

28,452,273

89,987,722

122,298,778

25,133,967

77,243,402

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