Quarterly Financial Report For the quarter ended September 30, 2014

Statement outlining results, risks and significant changes in operations, personnel and program

A. 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. It has not been subject to an external audit or review. This quarterly report should be read in conjunction with the Main Estimates and Supplementary.

The Office of the Director of Public Prosecutions (ODPP) is an independent prosecution service mandated to prosecute criminal and regulatory offences under federal jurisdiction. Its sole strategic outcome is the prosecution of these offences in a manner that is independent, impartial and fair. The ODPP plays an integral role in the criminal justice system, promoting due process and working to safeguard the rights of all those who come into contact with the justice system.

The benefits to Canadians from the work carried out by the ODPP include:

The ODPP has one strategic outcome and two program activities in addition to internal services:

B. Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the ODPP's spending authorities granted by Parliament and those used by the ODPP consistent with the Main Estimates. This quarterly report has been prepared using a financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.

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.

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.

The ODPP 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 remain on an expenditure basis.

C. Highlights of fiscal quarter and fiscal year to date results

Total Spending Authorities

At the end of the second quarter of 2014–2015, the ODPP had a total funding of $174,272 thousand available for use as detailed in Table 1 and Appendix A. This amount represents the 2014–2015 Main Estimates and the operating budget carry forward from last fiscal year. The increase of $4,882 thousand (or 3%) compared to total spending authorities at the same time in fiscal year 2013–2014 is mainly due to additional funding received for renewed collective agreements and an increase in revenues from the provision of prosecution services recovered from other government departments and agencies.

Table 1. Available Authorities of 2014–2015 compared to 2013–2014
(in thousands of dollars)
Vote 1 - Program Expenditures 2014–2015 2013–2014 Variance
$ %
Total 174,272 169,390 4,882 3%
Personnel costs and employee benefit plans 128,758 123,121 5,637 5%
Other O&M costs 68,256 64,011 4,245 7%
Less: Revenues credited to the vote (22,742) (17,742) (5,000) 28%

Total Expenditures

As indicated in Table 2, during the second quarter of 2014–2015, the ODPP spent $35,676 thousand compared to $45,103 thousand for the same period in 2013–2014, hence a decrease of $9,427 thousand (or 21%):

Table 2. Total Expenditures during the quarters ended September 30, 2014 and September 30, 2013
(in thousands of dollars)
Vote 1 - Program Expenditures Expenditures Variance
At the end
September 30, 2014
At the end
September 30, 2013
$ %
Total 35,676 45,103 (9,427) -21%
Personnel costs and employee benefit plans 29,865 34,745 (4,880) -14%
Other O&M costs 10,115 15,216 (5,101) -34%
Less: Revenues credited to the vote (4,304) (4,858) 554 -11%

Total YTD

At the end of September 2014, the ODPP spent $77,073 thousand (or 44%) from its total authorities of $174,272 thousand as shown in Table 3. At the same period last year, the ODPP had spent 49% of its total authorities due to additional payments for severance pay and for retroactive pay increases.

Table 3. Total Year-to-date Authorities and Expenditues at the end of September 30, 2014 and 2013
(in thousands of dollars)
Vote 1 - Program Expenditures 2014 2013
Total Net Authorities Total YTD Expenditues Variance YTD
%
Total Net Authorities Total YTD Expenditures Variance YTD
%
Total 174,272 77,073 44% 169,390 82,477 49%
Personnel costs and employee benefit plans 128,758 60,040 47% 123,121 67,110 55%
Other O&M costs 68,256 23,349 34% 64,011 21,904 34%
Less: Revenues credited to the vote (22,742) (6,316) 28% (17,742) (6,537) 37%

Appendices A and B provide further details.

D. Risks and Uncertainties

The ODPP’s key corporate risks are identified and assessed through an annual update of the Corporate Risk Profile. This year, a number of key risks could have financial impacts should they materialize. Strategies have been put in place to mitigate them.

Funding is the highest priority for action and the contributing factors are:

To minimize the risk, the ODPP created committees to control spending and staffing actions. It is also working closely with investigative agencies to anticipate and plan for resource-intensive actions by police.

E. Significant changes in relations to operations, personnel and programs

Budget 2010 (Strategic Review)

The ODPP achieved the reductions of Budget 2010 by:

The only proposal that is still outstanding is the outsourcing of the fine recovery program. The ODPP proposed to have the collection of outstanding federal fines conducted by outside entities under ODPP supervision as a means of increasing the collection of fines and thereby increasing their deterrent effect as well as public confidence in the administration of justice. As a result, the ODPP’s reference levels were permanently reduced by $1.6 million which corresponded to the savings in salary costs and other FTE-related costs of the 19 FTEs dedicated to the program. The collection of the outstanding federal fines is expected to begin in the next fiscal year.

Budget 2012 Implementation

Budget 2012 announced saving measures in order to refocus government and programs; make it easier for Canadians and business to deal with their government; and modernize and reduce the back office. The ODPP achieved the reductions by:

None of the measures affected staff levels and none contain any financial risks for the fiscal year 2014–2015.

Accounting treatment – Salary payment

In April 2014, the Government of Canada implemented payment in arrears for salary payments. Previously, pay was calculated and processed two weeks in advance of the work being performed. Now employees will be paid for the period that concluded two weeks before the payment is issued. Hence, new employees will have to wait four weeks before receiving a salary payment.

The Government has decided not to recover from existing employees for the pay in advance. Instead a one-time transition payment to existing employees was processed in the pay system in May 2014 to bring the pay period to two weeks prior to the date the payment is received. Unlike new employees, existing employees did not have to wait four weeks to receive a salary payment when the transition to payment in arrears occurred. Existing employees continue to receive a salary payment every two weeks, therefore, they will not be entitled to a "regular" salary payment two weeks after they depart from the public service. Instead, a final payment will be made to cover the difference between their current salary at departure and the transition payment which was issued in May 2014.

Approval by Senior Officials



________________________
Brian Saunders
Director of Public Prosecutions


Ottawa, Canada


________________________
Date



_______________________
Lucie Bourcier CPA, CGA
Chief Financial Officer

Appendix A

Statement of Authorities (unaudited)
  Fiscal year 2014–2015   Fiscal year 2013–2014
(in thousands of dollars) Total available for use for the year ending
March 31, 2015*
Used during the quarter ended
September 30, 2014
Year to date used at quarter-end   Total available for use for the year ended
March 31, 2014
Used during the quarter ended
September 30, 2013
Year to date used at quarter-end
Total authorities 174,272 35,676 77,073   169,390 45,103 82,477
Vote 1 – Program expenditures 156,036 31,117 67,955   151,142 40,541 73,353
Statutory authority 18,236 4,559 9,118   18,248 4,562 9,124
Total Budgetary authorities 174,272 35,676 77,073   169,390 45,103 82,477
Non-budgetary authorities - - -   -    

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

Appendix B

Departmental budgetary expenditures by Standard Object (unaudited)
  Fiscal year 2014–2015   Fiscal year 2013–2014
(In thousands of dollars) Planned expenditures for the year ending
March 31, 2015
Expended during the quarter ended
September 30, 2014
Year to date used at quarter-end   Planned expenditures for the year ended
March 31, 2014
Expended during the quarter ended
September 30, 2013
Year to date used  at quarter-end
Expenditures:
Total net budgetary expenditures 174,272 35,676 77,073   169,390 45,103 82,477
Personnel 128,758 29,865 60,040   123,121 34,745 67,110
Transportation and communications 9,720 1,391 2,213   6,935 1,585 2,478
Information 883 123 240   874 159 278
Professional and special services 45,283 7,464 15,581   43,951 11,235 15,683
Rentals 1,546 288 437   1,435 367 408
Repair and maintenance 1,436 121 158   1,456 1,089 1,642
Utilities, materials and supplies 1,657 325 506   964 319 476
Acquisition of machinery and equipment 2,209 122 167   2,471 299 373
Other subsidies and payments 5,522 281 4,047   5,925 163 566
Total gross budgetary expenditures 197,014 39,980 83,389   187,132 49,961 89,014
Less Revenues netted against expenditures:
Legal Services 22,742 4,304 6,316   17,742 4,858 6,537
Date modified: