Quarterly Financial Report ending June 30, 2016


This quarterly report has been prepared by management as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by the Treasury Board.  This quarterly report should be read in conjunction with the Main Estimates.

Contributing to the jobs and growth in Canada, the Canadian Northern Economic Development Agency (CanNor) works to develop a diversified, sustainable and dynamic economy across Canada's three territories.  It does this by delivering economic development programs, undertaking policy and research, and by collaborating with and aligning the efforts of other federal departments, territorial governments, Aboriginal organizations, and industry.  This is particularly the case in resource development through its Northern Projects Management Office (NPMO).

Further details on CanNor's authorities, mandate and program activities may be found in the Report on Plans and Priorities, and in the Main Estimates.

Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting.  The accompanying Statement of Authorities includes CanNor's spending authorities granted by Parliament and those used by the Agency consistent with the Main Estimates for the 2016-2017 fiscal year.  The authority of Parliament is required before moneys 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.

As part of the Parliamentary business of supply, the Main Estimates must be tabled in Parliament on or before March 1 preceding the new fiscal year. For 2016-2017, the Main Estimates were tabled on February 23, 2016.

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.

As part of the departmental performance reporting process, CanNor prepares its annual departmental financial statements on a full accrual basis in accordance with Treasury Board accounting policies, which are based on Canadian generally accepted accounting principles for the public sector. However, the spending authorities voted by Parliament remain on an expenditure basis.

Highlights of fiscal quarter and fiscal year to date (YTD) results

Statement of Authorities

As at June 30, 2016, total authorities available for fiscal year 2016-2017 amounted to $55.4M, a $4.7M increase from the same quarter last year.

The increase in authorities is a result of new funding for Canada 150 Infrastructure Program in the amount of $6.4M; offset by $1.3M in reduced funding for the Centre of Northern Innovation in Mining; and a net decrease in operating and employee benefits costs of $0.5M further to adjustments in salary, non-salary and contributions to employee benefits plans.   

Statement of Departmental Budgetary Expenditures by Standard Object

Compared to the previous year, total budgetary expenditures recorded in the quarter ending June 30, 2016 increased by $651K ($2.9M to $3.5M).

Personnel costs in the first quarter of 2016-2017 increased by $131K compared to previous year values. This reflects the Agency's increasing effort to fill vacant positions as quickly as possible.

Other operating costs increased by $134K over the previous year.  The change reflects an increase in professional services costs for legal services, translation and consulting services, offset slightly by decreased travel requirements.

Transfer payment expenditures increased by $304K in the first quarter compared to the previous year, reflecting increased efforts to advance the pace of project reviews and disbursements.

Risks and Uncertainties

Business development in the North needs to deal with the complexities related to remote communities, sparse population, dependence on natural resource extraction and associated challenges, such as underdeveloped infrastructure and labour market gaps.

Program delivery in the North therefore requires a strong focus on risk management and mitigation.

The Canadian Northern Economic Development Agency's Corporate Risk Profile and risk assessment is published in its 2016-17 Report on Plans and Priorities.  The risk profile identifies the following key risk areas:

Operational Environment

CanNor monitors expenditures and carries out business planning to ensure that financial risks are mitigated and that program delivery is optimized.  Progress is being made to increase the pace of project review and disbursements of contribution programs in order to make the most effective and efficient use of Agency resources.

Approved by:

Dr. Janet King
Ottawa, Canada
August 31, 2016
Ross Miller CPA, CMA
Chief Financial Officer

Statement of Authorities (unaudited)

  Fiscal year 2016-2017 Fiscal year 2015-2016
(In thousands of dollars) Total available for use for the year ending
March 31, 2017*
Used during the quarter ended
June 30, 2016
Year-to date used at quarter-end Total available for use for the year ending
March 31, 2016*
Used during the quarter ended
June 30, 2015
Year-to date used at quarter-end
* Includes only Authorities available for use and granted by Parliament at quarter-end.
Vote 1 - Net Operating 13,543 2,630 2,630 14,410 2,286 2,286
Vote 5 - Transfer payments 40,187 653 653 35,002 349 349
Budgetary statutory authorities 1,638 234 234 1,257 314 314
Total Budgetary authorities 55,368 3,517 3,517 50,669 2,949 2,949
Non-budgetary authorities 0 0 0 0 0 0
Total authorities 55,368 3,517 3,517 50,669 2,949 2,949

Departmental budgetary expenditures by Standard Object (unaudited)

  Fiscal year 2016-2017 Fiscal year 2015-2016
(In thousands of dollars) Total available for use for the year ending March 31, 2017 Used during the quarter ended June 30, 2016 Year-to-date used at quarter-end Total available for use for the year ending March 31, 2016 Used during the quarter ended June 30, 2015 Year-to-date used at quarter-end
Personnel 10,589 2,591 2,591 8,743 2,460 2,460
Transportation and communications 890 76 76 1,780 120 120
Information 44 0 0 33 3 3
Professional and special services 2,432 190 190 3,699 11 11
Rentals 896 3 3 1,221 2 2
Repair and maintenance 255 0 0 111 0 0
Utilities, materials and supplies 61 4 4 66 4 4
Acquisition of land, buildings and works 14 0 0 15 0 0
Acquisition of machinery and equipment 0 0 0 0 0 0
Transfer payments 40,187 653 653 35,001 349 349
Public Debt charges 0 0 0 0 0 0
Other subsidies and payments 0 0 0 0 0 0
Total budgetary expenditures 55,368 3,517 3,517 50,669 2,949 2,949

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