Quarterly Financial Report ending December 31, 2017

Introduction

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 and Supplementary Estimates (B).

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, Indigenous 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 Departmental Plan, the Main Estimates, and in the Supplementary Estimates (B).

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 and Supplementary Estimates (B) for the 2017-2018 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 2017-2018, the Main Estimates were tabled on February 23, 2017. The Supplementary Estimates (B) were tabled on December 11, 2017.

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 December 31, 2017, total authorities available for fiscal year 2017-2018 amounted to $55.7M, a $300K decrease from the same quarter last year. This is not a substantive change from the same quarter of the previous year.

Statement of Departmental Budgetary Expenditures by Standard Object

Compared to the previous year, total expenditures for the quarter ending December 31, 2017 increased by $1.5M ($10.4M to $11.9M).

Personnel costs in the third quarter of 2017-2018 increased by $83K compared to previous year values. This is not a substantive change from the same quarter of the previous year.

Other operating costs increased by $1.3M over the previous year. The change reflects an increase in costs to support Pilimmaksaivik, the Inuit Centre of Excellence in Employment, and other administrative changes. The increase in "professional and special services" reflects additional expenditures to support Pilimmaksaivik, which offset the recoveries mentioned in the second quarterly financial report.

Transfer payment expenditures increased by $211K in the third quarter compared to the previous year, which is not a substantive change.

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 2017-18 Departmental Plan. The risk profile identifies the following key risk areas:

Statement of Authorities (unaudited)

  Fiscal year 2017-2018 Fiscal year 2016-2017
(In thousands of dollars) Total available for use for the year ending March 31, 2018* Used during the quarter ended December 31, 2017 Year-to-date used at quarter-end Total available for use for the year ending
March 31, 2017*
Used during the quarter ended
December 31, 2016
Year-to-date used at quarter-end
Vote 1 - Net Operating 14,237 4,474 10,453 14,201 3,012 8,836
Vote 5 - Transfer payments 40,037 7,125 14,653 40,187 6,914 8,334
Budgetary statutory authorities 1,412 345 1,036 1,638 467 701
Total Budgetary authorities 55,686 11,944 26,142 56,026 10,393 17,871
Non-budgetary authorities 0 0 0 0 0 0
Total authorities 55,686 11,944 26,142 56,026 10,393 17,871
* includes only Authorities available for use and granted by Parliament at quarter-end.

Departmental budgetary expenditures by Standard Object (unaudited)

  Fiscal year 2017-2018 Fiscal year 2016-2017
(In thousands of dollars) Planned expenditures for the year ending March 31, 2018 Used during the quarter ended December 31, 2017 Year-to-date used at quarter-end Planned expenditures for the year ending March 31, 2017 Used during the quarter ended December 31, 2016 Year-to-date used at quarter-end
Expenditures:
Personnel 10,955 2,706 8,345 10,589 2,623 7,662
Transportation and communications 650 204 495 890 201 369
Information 84 32 36 44 3 17
Professional and special services 2,769 1,361 1,239 3,090 453 847
Rentals 1,063 230 686 896 181 596
Repair and maintenance 43 25 73 255 4 8
Utilities, materials and supplies 64 6 29 61 12 26
Acquisition of land, buildings and works 0 0 0 0 0 0
Acquisition of machinery and equipment 11 3 143 14 2 12
Transfer payments 40,037 7,125 14,654 40,187 6,914 8,334
Public Debt charges 0 0 0 0 0 0
Other subsidies and payments 10 254 443 0 0 0
Total budgetary expenditures 55,686 11,944 26,142 56,026 10,393 17,871

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