Library and Archives Canada – Quarterly Financial Report

For the quarter ended June 30, 2018

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 2018–2019 Main Estimates.

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

1.1 Library and Archives Canada’s mandate

Under the Library and Archives of Canada Act, LAC’s mandate is as follows:

  • to preserve the documentary heritage of Canada for the benefit of present and future generations;
  • to serve as 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.

The Minister of Canadian Heritage is responsible for LAC.

In 2018–2019, LAC will continue to meet the four commitments in its 2016–2019 Three-Year Plan and set guidelines and directions for its 2019–2022 Three-Year Plan:

  1. To be an institution fully dedicated to serving all of its clients: government institutions, donors, academics, researchers, archivists, librarians, students, genealogists, publishers and the general public.
  2. To be an institution that, drawing on the strength of its entire staff, is at the leading edge of archival and library science and of new technologies.
  3. To be an institution proactively engaged with national and international networks, in an open and inclusive way.
  4. To be an institution with greater public visibility, highlighting 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 for the 2018–2019 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, 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 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 June 30 are $119.7 million in 2018–2019, and $115.2 million in 2017–2018. 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 June 30, 2018, and June 30, 2017.

Authority Vote/Statutory Description For the quarter ended June 30, 2018 For the quarter ended June 30, 2017
Vote 1 Operating Expenditures

100,553,482

93,296,852

Vote 1 Revenue credited to the vote

(550,000)

(550,000)

Vote 5 Capital Expenditures

8,818,036

12,153,065

Statutory Spending of proceeds from the disposal of surplus Crown assets

11,873

12,028

Statutory Contributions to employee benefit plans

10,909,563

10,319,298

Total authorities Empty cell

119,742,954

115,231,243

The overall increase of $4.5 million results from the following:

  • An increase of $4.3 million for the revitalization of Indigenous languages and cultures initiative;
  • An increase of $2.3 million for negotiated salary adjustments;
  • An increase of $1.1 million for the private records of the Right Honourable Stephen Harper;
  • An increase of $0.5 million for adjustments to the contributions to employee benefits plans; and
  • A decrease of $3.7 million for the implementation of the Long-Term Real Property Plan.

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 $26.9 million as of June 30, 2018, and $25.9 million as of June 30, 2017. The total increase of $1.0 million is mainly explained by the following:

  • An increase of $1.2 million ($20.2 million in 2018–2019 compared with $19.0 million in 2017–2018) in expenditures for “Personnel” due to the hiring of personnel to support organizational priorities and to negotiated salary adjustments;
  • An increase of $0.9 million ($1.8 million in 2018–2019 compared with $0.9 million in 2017–2018) in expenditures for “Rentals” for the renewal of software licences and service fees with Shared Services Canada that occurred in the first quarter of 2018–2019 (when they occurred in the last three quarters in 2017–2018); and
  • A net decrease of $1.2 million in departmental expenditures detailed below, due to payments related to management and maintenance of special-purpose buildings. A reallocation under the appropriate standard object will be made in subsequent periods to reflect the appropriate nature of the expenditures:
    • A decrease of $2.8 million ($0.01 million in 2018–2019 compared with $2.8 million in 2017–2018) in expenditures for “Repair and maintenance”;
    • An increase of $1.6 million ($2.1 million in 2018–2019 compared with $0.5 million in 2017–2018) in expenditures for “Other subsidies and payments” due to a change in the allocation methodology.

3. Risks and uncertainties

Library and Archives Canada (LAC) has developed a Corporate Risk Profile for the 2018–2021 period. This profile describes the organizational risks and strategic impacts that have been identified, as well as the means put in place to mitigate them. An annual review of each mitigation measure allows monitoring of these risks. The following section presents these risks and their context.

  1. LAC may not be able to adapt quickly enough to evolving technology, which could affect its ability to meet the needs of its users.

    At a time when web users expect to find what they are looking for quickly and easily, their needs change as technology advances. LAC must take steps to provide the best customer experience possible. The risk lies mainly in the impact of technological changes, which are still unknown, and in LAC’s ability to adapt quickly.

  2. LAC’s digital processes may not be seamlessly integrated, which could affect its efficiency.

    In addition to having to adapt to technological changes, LAC must ensure that the systems and technological solutions put in place to acquire, preserve, manage and make available digital content are sufficiently integrated and compatible with each other. Systems harmonization requires a comprehensive and integrated view of all digital processes as well as sound planning that takes into account the particularities of each operation.

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 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

As of June 14, 2018, Ms.Karine Paré was appointed to the position of Director General of Financial Services, Procurement, and Deputy Chief Financial Officer.

There were no other significant changes in the organization’s activities and programs in the first quarter ended June 30, 2018.

Approval by Senior Officials

Original signed by:

________________________________
Guy Berthiaume
Librarian and Archivist of Canada
Gatineau, Canada
August 9, 2018

_______________________________
Anick Ouellette, CPA, CA
Assistant Deputy Minister, Corporate
Services and Chief Financial Officer
Library and Archives Canada
Gatineau, Canada
August 9, 2018

Table 2: Statement of Authorities (unaudited)

(in dollars)

This table indicates dollar figures for authorities for the fiscal year 2018–2019, including the total available for use for the year ending March 31, 2019; the total used during the quarter ended June 30, 2018; and the total year to date used at quarter-end. Displayed are the dollar figures for fiscal year 2017–2018, including the total available for use for the year ending March 31, 2018; the total used during the quarter ended June 30, 2017; and the total year to date used at quarter-end.

Authorities Fiscal year 2018-2019: Total available for use for the year ending March 31, 2019 table 2 note * Fiscal year 2018-2019: Used during the quarter ended June 30, 2018 Fiscal year 2018-2019: Year to date used at quarter-end Fiscal year 2017-2018: Total available for use for the year ending March 31, 2018 table 2 note ** Fiscal year 2017-2018: Used during the quarter ended June 30, 2017 Fiscal year 2017-2018: Year to date used at quarter-end
Vote 1 - Operating Expenditures

100,003,482

23,883,981

23,883,981

92,746,852

22,840,763

22,840,763

Vote 5 - Capital Expenditures

8,818,036

319,497

319,497

12,153,065

523,243

523,243

Contributions to the employee benefit plans

10,909,563

2,727,391

2,727,391

10,319,298

2,579,825

2,579,825

Spending of proceeds from the disposal of surplus Crown assets

11,873

0

0

12,028

0

0

Total budgetary authorities

119,742,954

26,930,869

26,930,869

115,231,243

25,943,831

25,943,831

Non-budgetary authorities

0

0

0

0

0

0

Total authorities

119,742,954

26,930,869

26,930,869

115,231,243

25,943,831

25,943,831

Table 2 Notes
Table 2 Note *

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

Return to table 2 note * referrer

Table 2 Note **

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

Return to table 2 note ** referrer

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 2018-2019; numbers are arranged by total planned expenditures for the year ending March 31, 2019; the total expended during the quarter ended June 30, 2018; 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 2017-2018; numbers are arranged by total planned expenditures for the year ending March 31, 2018; the total expended during the quarter ended June 30, 2017; and the total year to date used at quarter-end.

Fiscal year 2018-2019: Planned expenditures for the year ending March 31, 2019 Fiscal year 2018-2019: Expended during the quarter ended June 30, 2018 Fiscal year 2018-2019: 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 June 30, 2017 Fiscal year 2017-2018: Year to date used at quarter-end
Expenditures:
Personnel

82,683,004

20,179,691

20,179,691

76,047,312

19,025,380

19,025,380

Transportation and communications

1,238,309

267,204

267,204

155,361

190,271

190,271

Information

701,000

39,836

39,836

700,000

59,491

59,491

Professional and special services

11,854,632

998,667

998,667

13,550,298

1,195,892

1,195,892

Rentals

2,789,170

1,809,217

1,809,217

5,315,305

956,020

956,020

Repair and maintenance

5,154,878

13,780

13,780

11,505,260

2,768,475

2,768,475

Utilities, materials and supplies

2,106,398

148,189

148,189

648,312

260,475

260,475

Acquisition of land, buildings and works

3,622,234

56,218

56,218

0

0

0

Acquisition of machinery and equipment

2,671,988

93,618

93,618

435,250

42,026

42,026

Transfer payments

1,500,000

1,305,978

1,305,978

1,536,000

1,037,964

1,037,964

Other subsidies and payments

5,971,341

2,057,847

2,057,847

5,888,145

449,219

449,219

Total gross budgetary expenditures

120,292,954

26,970,245

26,970,245

115,781,243

25,985,213

25,985,213

Less Revenues netted against expenditures:
Respendable revenue

550,000

39,376

39,376

550,000

41,382

41,382

Total Revenues netted against expenditures

550,000

39,376

39,376

550,000

41,382

41,382

Total net budgetary expenditures

119,742,954

26,930,869

26,930,869

115,231,243

25,943,831

25,943,831

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