Quarterly Financial Report for the quarter ended September 30, 2018

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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 September 30 are $127.2 million in 2018–2019, and $122.2 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)
Authority
Vote/Statutory
Description For the quarter ended
September 30, 2018
For the quarter ended
September 30, 2017
Vote 1 Operating Expenditures 105,141,524 97,992,828
Vote 1 Revenue credited to the vote (550,000) (550,000)
Vote 5 Capital Expenditures 11,655,073 14,397,864
Statutory Spending of proceeds from the disposal of surplus Crown assets 12,555 16,059
Statutory Contributions to employee benefit plans 10,909,563 10,319,298
Total authorities   127,168,715 122,175,049
  • Table 1 summary

    For each Authority (Vote/Statutory), this table indicates the description of vote or authority, and the dollar figure, for the quarters ended September 30, 2018, and September 30, 2017.

The overall increase of $5.0 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 in operating budget carry-forward and capital carry-forward;
  • 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 $56.6 million as of  September 30, 2018, and $61.5 million as of September 30, 2017. The total increase of $4.9 million is mainly explained by the following:

  • A decrease of $2.5 million ($40.9 million in 2018–2019 compared with $43.4 million in 2017–2018) in expenditures for “Personnel” attributable to retroactive payments from previous years following the negociated salary adjustments;
  • A net decrease of $2.4 million in departmental expenditures detailed below, due to payments related to management and maintenance of special-purpose buildings. Expenditures in 2017–2018 were in the first two quarters, while those in 2018–2019 will be in the coming months. In addition, in 2017–2018, a reallocation under the appropriate standard object was completed in subsequent periods, to properly reflect the nature of expenditures. As of September 30, 2018, expenses are accounted for under the appropriate standard object:
    • An increase of $1.1 million ($3.9 million in 2018–2019 compared with $2.8 million in 2017–2018) in expenditures for “Professional and special services”;
    • An increase of $0.8 million ($1.1 million in 2018–2019 compared with $0.3 million in 2017–2018) in expenditures for “Utilities, materials and supplies”;
    • A decrease of $1.7 million ($6.2 million in 2018–2019 compared with $7.9 million in 2017–2018) in expenditures for “Other subsidies and payments” due to a change in the allocation methodology;
    • A decrease of $2.6 million ($0.2 million in 2018–2019 compared with $2.8 million in 2017–2018) in expenditures for “Repair and maintenance”.

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

There were no significant changes regarding personnel, programs or activities in the organization during the second quarter, which ended on September 30, 2018.

Approval by Senior Officials

Original signed by:


Guy Berthiaume
Librarian and Archivist of Canada
Gatineau, Canada
November 15, 2018


Karine Paré for Anick Ouellette, CPA, CA
Assistant Deputy Minister, Corporate
Services and Chief Financial Officer
Library and Archives Canada
Gatineau, Canada
November 15, 2018

Table 2: Statement of Authorities (unaudited)
(in dollars)

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
September 30,
2018
Fiscal year
2018-2019:

Year to date
used at
quarter-end
Fiscal year
2018-2019:

Total available
for use for the
year ending
March 31,
2018  table 2 note**
Fiscal year
2018-2019:

Used during
the quarter
ended
September 30,
2017
Fiscal year
2018-2019:

Year to date
used at
quarter-end
Vote 1 - Operating Expenditures 104,591,524 26,042,910 49,926,891 97,442,828 32,084,221 54,924,985
Vote 5 - Capital Expenditures 11,655,073 932,754 1,252,251 14,397,864 927,573 1,450,815
Contributions to the employee benefit plans 10,909,563 2,727,391 5,454,782 10,319,298 2,579,825 5,159,649
Spending of proceeds from the disposal of surplus Crown assets 12,555 0 0 16,059 0 0
Total budgetary authorities 127,168,715 29,703,055 56,633,924 122,176,049 35,591,618 61,535,449
Non-budgetary authorities 0 0 0 0 0 0
Total authorities 127,168,715 29,703,055 56,633,924 122,176,049 35,591,618 61,535,449
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 2 summary

    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 September 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 September 30, 2017; and the total year to date used at quarter-end.

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

  Fiscal year
2018-2019:

Planned expenditures
for the year ending
March 31, 2019
Fiscal year
2018-2019:

Expended during
the quarter ended
September 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
September 30,
2017
Fiscal year
2017-2018:

Year to date used
at quarter-end
Expenditures:
Personnel 82,683,004 20,697,932 40,877,623 76,047,312 24,393,543 43,418,923
Transportation and communications 1,452,666 262,774 529,978 177,950 193,755 384,026
Information 822,346 91,551 131,387 801,777 86,846 146,337
Professional and special services 16,743,757 2,878,440 3,877,107 17,765,261 1,591,725 2,787,617
Rentals 3,271,300 344,477 2,153,694 6,089,272 1,278,253 2,234,273
Repair and maintenance 6,047,209 202,085 215,865 13,178,083 43,300 2,811,774
Utilities, materials and supplies 2,470,338 974,783 1,122,972 743,715 65,857 326,332
Acquisition of land, buildings and works 3,622,234 39,501 95,719 0 0 0
Acquisition of machinery and equipment 3,134,520 170,274 263,892 498,534 247,158 289,184
Transfer payments 1,500,000 2,541 1,308,519 1,536,000 282,380 1,320,344
Other subsidies and payments 5,971,341 4,114,159 6,172,006 5,888,145 7,490,129 7,939,349
Total gross budgetary expenditures 127,718,715 29,778,517 56,748,762 122,726,049 35,672,946 61,658,159
Less Revenues netted against expenditures:
Respendable revenue 550,000 75,462 114,838 550,000 81,328 122,710
Total Revenues netted against expenditures 550,000 75,462 114,838 550,000 81,328 122,710
Total net budgetary expenditures 127,168,715 29,703,055 56,633,924 122,176,049 35,591,618 61,535,449
  • Table 3 summary

    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 September 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 September 30, 2017; and the total year to date used at quarter-end.

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