Quarterly Financial Report for the Quarter Ended June 30, 2014

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 2014‑2015 Main Estimates and Supplementary Estimates (A).

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 a departmental agency 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 cooperation 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.

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 LAC's spending authorities granted by Parliament and those used by LAC, consistent with the Main Estimates and Supplementary Estimates (A) for the 2014‑2015 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs regarding 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, section 30 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 performance reporting process. However, the spending authorities voted by Parliament are still prepared on an expenditure basis.

2. Highlights of Fiscal Quarter and Fiscal Year-to-Date (YTD) Results

2.1 Statement of Authorities

As reflected in the attached Statement of Authorities, total authorities available for use as of June 30 are $96.0 million in 2014‑2015, and $98.5 million in 2013‑2014. The following table presents the detailed list of authorities by fiscal year: 

For each Authority Vote/Statutory, this table indicates the Authority Code, description of vote or authority, and the dollar figure, for the quarters ended June 30, 2014, and June 30, 2013.
Authority
Vote/Statutory
Authority Code Description
For the quarter ended
June 30, 2014
For the quarter ended
June 30, 2013
Vote 1 (2014-2015) and Vote 55 (2013-2014) B110 Program expenditures (2014-2015) and Operating Expenditures (2013-2014) 86,981,409 85,762,191
Vote 1 (2014-2015) and Vote 55 (2013-2014) B130 Revenue Credited to the Vote -550,000 -550,000
Vote 1 (2014-2015) and Vote 60 (2013-2014) B140 Capital Expenditures    0 2,956,827
S A131 Spending of proceeds from the disposal of surplus Crown assets 133,879 177,665
S A140 Contributions to employee benefit plans 9,433,379 10,177,677
Total  authorities     95,998,667 98,524,360

The overall net decrease of $2.5 million in total available authorities for use between the two fiscal years is mainly due to the following:

  • An overall decrease of $6.0 million resulting from:
    • a decrease of $3.0 million due to savings identified as part of the Budget 2012 spending review;
    • a decrease of $2.6 million for the conversion of a facility in Gatineau, Quebec to a high-density shelving system Collection Storage Facility;
    • a decrease of $0.4 million to Shared Services Canada as part of the Workplace Technology Devices Initiative.
  • An overall increase of $3.5 million resulting from:
    • an increase of $1.9 million from Public Works and Government Services Canada as a result of Library and Archives Canada program space consolidation and rationalization efforts;
    • an increase of $0.9 million for compensation adjustments to fund increased personnel costs of collective agreements and employee benefit plans (statutory);
    • an increase of $0.7 million from Public Works and Government Services Canada for reimbursement as a result of a reduction in accommodation requirements.
2.2 Statement of Departmental Budgetary Expenditures by Standard Object

As presented in the attached Statement of Departmental Budgetary Expenditures by Standard Object, the year-to-date expenditures total $24.3 million as of June 30, 2014, and $20.7 million as of June 30, 2013. The total increase of $3.6 million is explained mainly by:

  • An increase of $2.4 million ($2.7 million in 2014‑2015 and $0.3 million in 2013‑2014) is mainly due to a one‑time transition payment for implementing salary payment in arrears by the Government of Canada.​

  • An increase of $0.6 million ($1.2 million in 2014‑2015 and $0.6 million in 2013‑2014) in expenditures for "Professional and Special Services," resulting mainly from the fact that the cost recovery related to an interdepartmental memorandum of understanding between LAC and another government institution concerning security services was not billed at the end of the first quarter of 2014-2015, in comparison with the same period the year before, and from an increase in expenditures for professional and temporary help services to support corporate priorities.

  • An increase of $0.3 million ($0.4 million in 2014‑2015 and $0.1 million in 2013‑2014) in the expenditures for "Utilities, Materials and Supplies," resulting mainly from the acquisition of documentary heritage that enables LAC to continue documenting Canadian society.

  • An increase of $0.3 million ($0.3 million in 2014‑2015 and $0 million in 2013‑2014) in expenditures for "Acquisition of Land, Buildings and Works," resulting mainly from the expenditures related to the development of digital spaces in the facility in Gatineau, Quebec, a collection storage facility with a high-density shelving system.

  • A decrease of $0.3 million ($19.1 million in 2014‑2015 and $19.4 million in 2013‑2014) in "personnel" expenditures, resulting mainly from a decrease in salary expenditures paid out in severance pay to LAC employees following the ratification of new collective agreements, net from an increase in salary expenditures following the hiring of temporary personnel to support corporate priorities.

3. Risks and Uncertainties

LAC has identified four strategic risks that may have an impact on achieving its legislative mandate:

  • That essential documentary heritage will not be acquired;
  • That documentary heritage will not be preserved for future generations;
  • That documentary heritage will not be accessible to Canadians; and
  • That Government of Canada information resources will not be managed properly.

The strategic risks translate into corporate risks that may have an impact on LAC's operations. They are identified and assessed by LAC's senior officials and managers. They must be reviewed in‑depth every three years and validated every year for relevance.

The principal areas of operational risk identified in 2014 include digital preservation, online access, the description of the collection and technology management. LAC's strategy for mitigating these risks includes a number of concrete initiatives specific to each risk.

4. Significant Changes in Relation to Operations, Personnel and Programs

Over the past few years, LAC has taken advantage of the innovations created by the rapid growth in digital technologies to refocus its mandate, clarify how it wants to fulfill it and identify the best means and strategies for doing so.

LAC has developed policy frameworks for its operations and will continue its innovation efforts to consolidate its approach and provide even more tangible results for Canadians.

LAC is focused on the commitments set out in the 2014‑2015 Report on Plans and Priorities. Therefore LAC's activities are centred on the following priorities:

  1. acquire documentary resources representative of Canadian society;
  2. improve the preservation of documentary heritage in digital and analogue formats;
  3. provide quality service to Canadians and maximize access to LAC's holdings using digital technologies;
  4. adopt a more collaborative approach with documentary heritage communities to fulfill LAC's mandate;
  5. develop the infrastructure and the strategies needed to manage documentary heritage in the 21st century.

5. Budget 2012 Implementation

This section provides an overview of the cost-saving measures announced in Budget 2012. The total cost-saving measures for LAC were $3.5 million in 2012–2013, $6.6 million in 2013–2014, and $9.6 million in 2014–2015 and subsequent years. These measures were implemented to refocus the government and its programs, make it easier for Canadians and businesses to deal with their government, and modernize and streamline administrative services.

Budget for acquisitions: The $0.4 million dedicated budget to purchase documents and special collections was eliminated. In future, these purchases will be made within LAC's usual acquisition process using available resources.

National Archival Development Program (NADP): The NADP was terminated under Budget 2012 and some wind-down costs were incurred in 2012–2013.

Reduced spending related to five other LAC programs as a result of Budget 2012 impacts salaries as a result of workforce reduction.

Approval by Senior Officials


Approved by:


 

Signed by G. Berthiaume

_____________________________________________________
Guy Berthiaume
Librarian and Archivist of Canada
August 27, 2014

 

Signed by H. Déry

_____________________________________________________
Hervé Déry
Assistant Deputy Minister, Corporate Services, and Chief Financial Officer
August 22, 2014


 

Statement of Authorities (unaudited)

This table indicates dollar figures for authorities for the fiscal year 2014–2015, including the total available for use for the year ending March 31, 2015; the total used during the quarter ended June 30, 2014; and the total year to date used at quarter-end. Displayed are the dollar figures for fiscal year 2013–2014, including the total available for use for the year ending March 31, 2014; the total used during the quarter ended June 30, 2013; and the total year to date used at quarter-end.
  Fiscal year 2014-2015   Fiscal year 2013-2014

(in dollars)
Total available for use for the year ending March 31,
2015 * 
Used during the quarter ​ended June 30, 2014
Year to date used at quarter-end   Total available for use for the year ending March 31,
2014 *
Used during the quarter ended June 30, 2013
Year to date used at quarter-end
               
Vote 1 (2014-15) - Program expenditures and
Vote 55 (2013-2014) - Operating Expenditures
86,431,409 21,940,764 21,940,764   85,212,191 18,107,470 18,107,470
Vote 1 (2014-2015) and Vote 60 (2013-2014) -
Capital expenditures
0 0 0   2,956,827 0 0
Contributions to the employee benefit plans  9,433,379 2,358,345 2,358,345   10,177,677 2,544,419 2,544,419
Spending of proceeds from the disposal of surplus Crown assets  133,879 0 0   177,665 0 0
Total Budgetary authorities 95,998,667 24,299,109 24,299,109   98,524,360 20,651,889 20,651,889
Non-budgetary authorities 0 0 0    0  0  0
Total authorities 95,998,667 24,299,109 24,299,109   98,524,360 20,651,889 20,651,889

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


 


 

Departmental budgetary expenditures by Standard Object (unaudited)

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 2014–2015; numbers are arranged by total planned expenditures for the year ending March 31, 2015; the total expended during the quarter ended June 30, 2014; 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 2013–2014; numbers are arranged by total planned expenditures for the year ending March 31, 2014; the total expended during the quarter ended June 30, 2013; and the total year to date used at quarter-end.
  Fiscal year 2014-2015   Fiscal year 2013-2014

(in dollars)
Planned expenditures for the year ending
March 31, 2015 
Expended during the quarter ended
June 30, 2014
Year to date used at quarter-end
 
Planned expenditures for the year ending March 31, 2014 
Expended during the quarter ended June 30, 2013
Year to date used
at quarter-end
Expenditures:              
Personnel 66,605,374 19,119,577 19,119,577   68,670,075 19,382,946 19,382,946
Transportation and communications 1,952,535 129,875 129,875   1,480,017 71,310 71,310
Information 301,659 4,659 4,659   369,038 8,411 8,411
Professional and special services 15,107,057 1,154,297 1,154,297   13,498,422 570,497 570,497
Rentals 4,417,190 383,734 383,734   3,604,752 247,192 247,192
Repair and maintenance 1,835,260 36,844 36,844   2,282,114 38,606 38,606
Utilities, materials and supplies 2,606,879 351,285 351,285   2,155,952 79,104 79,104
Acquisition of land, buildings and works 700,000 343,998 343,998   2,956,827 0 0
Acquisition of machinery and equipment 2,614,028 101,793 101,793   3,854,578 36,188 36,188
Transfer payments 36,000 0 0   36,000 26,116 26,116
Other subsidies and payments 372,685 2,709,527 2,709,527   166,585 260,238 260,238
Total gross budgetary expenditures 96,548,667 24,335,589 24,335,589   99,074,360 20,720,608 20,720,608
Less Revenues netted against expenditures:              
Respendable revenue 550,000 36,480 36,480   550,000 68,719 68,719
               
Total Revenues netted against expenditures: 550,000 36,480 36,480   550,000 68,719 68,719
Total net budgetary expenditures 95,998,667 24,299,109 24,299,109   98,524,360 20,651,889 20,651,889
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