Quarterly Financial Report for the Quarter Ended June 30, 2016

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 2016–2017 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 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.

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) for the 2016–2017 fiscal year. It 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 Statement of Authorities below, total authorities available for use as of June 30 are $116.9 million in 2016–2017, and $93 million in 2015–2016. The following table presents the detailed list of authorities by fiscal year:

Statement of Authorities (unaudited)
(in dollars)

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, 2016 and June 30, 2015.

Authority
Vote/Statutory

Authority code

Description

For the quarter ended June 30, 2016

For the quarter ended June 30, 2015

Vote 1

B110

Operating Expenditures (2016-2017) and Program Expenditures (2015-2016)

95,455,525

84,962,100

Vote 1

B130

Revenue credited to the vote

(550,000)

(1,779,000)

Vote 5 (2016-17)
Vote 1 (2015-16)

B140

Capital Expenditures (2016-17) and Program Expenditures (2015-2016)

11,937,824

0

S

A131

Spending of proceeds from the disposal of surplus Crown assets

28,770

34,753

S

A140

Contributions to employee benefit plans

10,015,219

9,828,389

Total authorities

 

 

116,887,338

93,046,242

The overall increase of $23.9 million is due to a government decision to transfer permanent funds from Public Services and Procurement Canada (PSPC) to LAC, so as to consolidate and transfer administration of our special-purpose storage facilities, while supporting our long-term infrastructure strategy. As of 2016–2017, LAC is responsible for costs associated with the management and maintenance of its special-purpose storage facilities, previously under the responsibility of PSPC.

In addition, revenue credited to the vote decreased by $1.2 million. This decrease was due to the fact that the interdepartmental memorandum of understanding between LAC and Aboriginal Affairs and Northern Development Canada (aimed at providing the Truth and Reconciliation Commission of Canada with all government records on residential schools under the custody and control of LAC) was not renewed in 2016–2017. The revenue credited to the vote authority had been granted to LAC to cover 2015–2016 expenditures.

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 $23.8 million as of June 30, 2016, and $21.3 million as of June 30, 2015. The total increase of $2.5 million is mainly explained by:

  • a $1.3 million increase ($1.3 million in 2016–2017 compared to $0.01 million in 2015–2016) in expenditures for “Repairs and Maintenance” attributable to expenditures incurred as a result of the government’s decision to transfer permanent funds from PSPC to LAC so as to consolidate and transfer administration of our special-purpose storage facilities, while supporting our long-term infrastructure strategy. As of 2016–2017, LAC is responsible for costs associated with the management and maintenance of its special-purpose storage facilities, previously under the responsibility of PSPC;
  • a $1.2 million increase ($1.2 million in 2016–2017 versus $0 in 2015–2016) of “transfer payment” expenditures associated with the Documentary Heritage Communities Program, which were incurred during the first quarter of 2016–2017 but later in the 2015–2016 year.

3. Risks and Uncertainties

LAC has formalized its practices and developed a corporate risk profile in order to identify strategic and corporate risks, evaluate their potential consequences and impacts, and develop measures to reduce these risks. In its risk profile, LAC targets four strategic risks that may have a direct impact on the fulfillment of its mandate. These risks, the description of their context, and the strategies put forth to mitigate them are presented in the section that follows.

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. The scope of its mandate is such that LAC may be unable to identify all the content that should be acquired.

  2. Risk that documentary heritage is not preserved
    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 the obsolescence of the technologies needed to consult a format that is outdated. The loss of technical expertise and the lack of space providing adequate storage conditions are considered internal risk factors.

  3. Risk that documentary heritage is not accessible
    Despite technological advances, much of LAC's collection is on paper or other analogue media. The time and effort needed to process the collection to make it discoverable and make it available online are such that LAC must target its efforts to quickly provide access to the material that is of greatest interest to its clients.

  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 business, legal or historical value. Proactive management of government information is therefore essential; it ensures the government's accountability and the best use of information.

The strategic risks translate into corporate risks that may have an impact on LAC’s operations. Corporate risks are identified and assessed by LAC’s senior officials and managers. They are reviewed in-depth every three years and they are validated every year to maintain relevance.

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

As stated in our 2016–2019 Triennial Plan, to manage service delivery and enhance our public profile, we have established priorities focused on high-quality services provided by expert, professional staff and supported by networking partnerships:

  1. Library and Archives Canada is an institution fully dedicated to serving all its clients: government institutions, donors, academics, researchers, archivists, librarians, students, genealogists and the general public.
  2. Library and Archives Canada 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. Library and Archives Canada is an institution proactively engaged with national and international networks in an open and inclusive way.
  4. Library and Archives Canada is an institution with prominent public visibility that highlights the value of its collection and services.

Approval by Senior Officials

Original signed by:

___________________________________
Guy Berthiaume
Librarian and Archivist of Canada
Gatineau, Canada
August 22, 2016

Original signed by:

___________________________________
Isabelle Niquette
Chief Financial Officer
Gatineau, Canada
August 16, 2016
(Acting)

 

Statement of Authorities (unaudited)

(in dollars)

Authorities

Fiscal year 2016-2017: Total available for use for the year ending March 31, 2017 *

Fiscal year 2016-2017: Used during the quarter ended June 30, 2016

Fiscal year 2016–2017:
Year to date used at quarter-end

Fiscal year 2015–2016:
Total available for use for the year ending March 31, 2015 *

Fiscal year 2015–2016:
Used during the quarter ended
December 31, 2014

Fiscal year 2015–2016:
Year to date used at quarter-end

Vote 1 (2016-2017) - Operating Expenditures and Vote 1 (2015-2016) Program Expenditures

94,905,525

21,047,623

21,047,623

83,183,100

18,822,198

18,822,198

Vote 5 - Capital Expenditures and Vote 1 (2015-2016) - Program Expenditures

11,937,824

224,077

224,077

0

0

0

Contributions to the employee benefit plans

10,015,218

2,503,805

2,503,805

9,828,389

2,457,097

2,457,097

Spending of proceeds from the disposal of surplus Crown assets

28,770

0

0

34,753

0

0

Total budgetary authorities

116,887,337

23,775,505

23,775,505

93,046,242

21,279,296

21,279,296

Non-budgetary authorities

0

0

0

0

0

0

Total authorities

116,887,337

23,775,505

23,775,505

93,046,242

21,279,296

21,279,296

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

Departmental Budgetary Expenditures by Standard Object (unaudited)

(in dollars)

Fiscal year 2016-2017: Planned expenditures for the year ending March 31, 2017

Fiscal year 2016-2017: Expended during the quarter ended June 30, 2016

Fiscal year 2016-2017: Year to date used at quarter-end

Fiscal year 2015-2016: Planned expenditures for the year ending March 31, 2016

Fiscal year 2015-2016: Expended during the quarter ended June 30, 2015

Fiscal year 2015-2016: Year to date used at quarter-end

Expenditures:

Personnel

68,243,232

18,356,297

18,356,297

68,330,703

18,986,831

18,986,831

Transportation and communications

1,111,180

208,856

208,856

1,535,627

177,322

177,322

Information

147,000

63,898

63,898

255,938

25,996

25,996

Professional and special services

25,308,969

900,787

900,787

13,564,707

554,562

554,562

Rentals

2,485,256

1,039,875

1,039,875

2,576,755

1,013,175

1,013,175

Repair and maintenance

11,540,403

1,270,958

1,270,958

1,535,627

14,436

14,436

Utilities, materials and supplies

1,143,974

173,448

173,448

2,832,693

141,552

141,552

Acquisition of land, buildings and works

0

0

0

830,000

0

0

Acquisition of machinery and equipment

398,984

28,233

28,233

3,071,254

194,297

194,297

Transfer payments

1,536,000

1,194,315

1,194,315

36,000

0

0

Other subsidies and payments

5,522,339

567,519

567,519

255,938

210,760

210,760

Total gross budgetary expenditures

117,437,337

23,804,186

23,804,186

94,825,242

21,318,931

21,318,931

Less Revenues netted against expenditures:

Respendable revenue

550,000

28,681

28,681

1,779,000

39,635

39,635

Total Revenues netted against expenditures:

550,000

28,681

28,681

1,779,000

39,635

39,635

Total net budgetary expenditures

116,887,337

23,775,505

23,775,505

93,046,242

21,279,296

21,279,296

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