Quarterly Financial Report For the quarter ended December 31, 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. 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:

On October 1, 2014, by virtue of the adoption of an Order in Council providing for the coming into force of amendments to the Canada Elections Act, the Office of the Commissioner of Canada Elections (OCCE) was formally transferred from Elections Canada to the ODPP. The Commissioner and the Director exercise their statutory duties independently from each other, even while operating within the same organization.

The ODPP has two strategic outcomes and four program activities in addition to internal services:

Strategic Outcome: Criminal and regulatory offences under federal law are prosecuted in an independent, impartial and fair manner.

Strategic Outcome: Compliance and enforcement activities under the Canada Elections Act and Referendum Act are conducted by the Commissioner of Canada Elections in an independent, impartial and fair manner.

Internal services: Internal services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization.

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 third quarter of 2014–2015, the ODPP had a total funding of $175,222 thousand available for use as detailed in Table 1 and Appendix A. This amount mainly represents the 2014–2015 Main Estimates, the operating budget carry forward from last fiscal year as well as a transfer of salary funds from Elections Canada to cover the Office of the Commissioner of Canada Elections expenditures. The decrease of $13,789 thousand (or 7%) compared to total spending authorities at the same time in fiscal year 2013–2014 is mainly due to the previous year’s additional funds for collective agreements, severance pay entitlements, and the relocation of offices.

Table 1. Available Authorities of 2014–2015 compared to 2013–2014
(in thousands of dollars)
Program Expenditures 2014–2015 2013–2014 Variance
$ %
Total Spending Authorities 175,222 189,011 (13,789) -7%
Personnel costs and employee benefit plans 129,622 138,964 (9,342) -7%
Other O&M costs 68,342 72,789 (4,447) -6%
Less: Revenues credited to the vote (22,742) (22,742) 0 0%

Total Expenditures

As indicated in Table 2, during the third quarter of 2014–2015, the ODPP spent $37,887 thousand compared to $40,838 thousand for the same period in 2013–2014, hence a decrease of $2,951 thousand (or 7%):

Table 2. Total Expenditures during the quarters ended December 31, 2014 and December 31, 2013
(in thousands of dollars)
Program Expenditures Expenditures Variance
As at
December 31, 2014
As at
December 31, 2013
$ %
Total 37,887 40,838 (2,951) -7%
Personnel costs and employee benefit plans 30,680 31,907 (1,227) -4%
Other O&M costs 13,869 15,237 (1,368) -9%
Less: Revenues credited to the vote (6,662) (6,306) (356) 6%

Total YTD

At the end of December 2014, the ODPP spent $114,960 thousand (or 66%) from its total authorities of $175,222 thousand as shown in Table 3. At the same time last year, the ODPP had spent the same proportion, i.e. 65% of its total authorities.

Table 3. Total Year-to-date Authorities and Expenditues at the end of December 31, 2014 and 2013
(in thousands of dollars)
Program Expenditures 2014 2013
Total Net Authorities Total YTD Expenditues Variance YTD
%
Total Net Authorities Total YTD Expenditures Variance YTD
%
Total 175,222 114,960 66% 189,011 123,315 65%
Personnel costs and employee benefit plans 129,622 90,720 70% 138,964 99,018 71%
Other O&M costs 68,342 37,218 54% 72,789 37,140 51%
Less: Revenues credited to the vote (22,742) (12,978) 57% (22,742) (12,843) 56%

Total YTD Authorities by Strategic Outcomes and Internal Services

With the transfer of the OCCE to the ODPP on October 1st, 2014, a second strategic outcome has been added to the ODPP’s mandate. To fund this new outcome this fiscal year, the Parliament has given the ODPP authority to spend $740 thousand in the form of an annually approved limit as well as statutory spending authority.

Table 4. Total Year-to-date Authorities by Strategic Outcomes and Internal Services at the end of December 31, 2014
(in thousands of dollars)
Program Expenditures Vote 1 Statutory Authorities Total
Personnel O&M Revenue credited to the vote Electoral Contributions to Employee Benefit Plans
Personnel O&M
Total 111,323 68,257 (22,742) 63 85 18,236 175,222
Strategic Outcome 1
Criminal and regulatory offences under federal law are prosecuted in an independent, impartial and fair manner
96,064 60,027 (22,267) 0 0 15,857 149,681
Strategic Outcome 2
Compliance and enforcement activities under the Canada Elections Act and Referendum Act are conducted by the Commissioner of Canada Elections in an independent, impartial and fair manner
740 0 0 63 85 0 888
Internal Services 14,519 8,230 (475) 0 0 2,379 24,653

Total YTD Expenditures by Strategic Outcomes and Internal Services

Expenditures in relation to table 4 above are as follows for fiscal year 2014–2015.

Table 5. Total Year-to-date Expenditures by Strategic Outcomes and Internal Services at the end of December 31, 2014
(in thousands of dollars)
Program Expenditures Vote 1 Statutory Authorities Total
Personnel O&M Revenue credited to the vote Electoral Contributions to Employee Benefit Plans
Personnel O&M
Total 76,980 37,133 (12,978) 63 85 13,677 114,960
Strategic Outcome 1
Criminal and regulatory offences under federal law are prosecuted in an independent, impartial and fair manner
66,344 34,492 (12,978) 0 0 13,677 101,535
Strategic Outcome 2
Compliance and enforcement activities under the Canada Elections Act and Referendum Act are conducted by the Commissioner of Canada Elections in an independent, impartial and fair manner
303 0 0 63 85 0 451
Internal Services 10,333 2,641 0 0 0 0 12,974

As far as the second strategic outcome is concerned, most expenditures are salary related for the third quarter.

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

Transfer of the Office of the Commissioner of Canada Elections from Elections Canada to the ODPP

On October 1, 2014, by virtue of the adoption of an Order in Council providing for the coming into force of amendments to the Canada Elections Act, the OCCE was formally transferred from Elections Canada to the ODPP. The OCCE became responsible for its own legal and communications functions. Both services were previously provided by staff at Elections Canada. This has resulted in an increase in staffing levels at the OCCE.

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. A modified fine recovery program has been developed and will be implemented starting in 2015-16. It includes outsourcing parts of the collection process to one or several private collection agencies. The ODPP will continue to administer the program and will manage contracts with service providers.

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
December 31, 2014
Year to date used at quarter-end   Total available for use for the year ended
March 31, 2014
Used during the quarter ended
December 31, 2013
Year to date used at quarter-end
Total authorities 175,222 37,887 114,960   189,011 40,839 123,315
Vote 1 – Program expenditures 156,838 33,180 101,135   170,763 36,277 109,629
Statutory Authorities
Electoral expenditures** 148 148 148   0 0 0
Contributions to employee benefit plans 18,236 4,559 13,677   18,248 4,562 13,686
Total Statutory Authorities 18,384 4,707 13,825   18,248 4,562 13,686
Total Budgetary authorities 175,222 37,887 114,960   189,011 40,839 123,315
Non-budgetary authorities 0 0 0   0 0 0

* Includes only Authorities available for use and granted by Parliament at quarter end.
** Under the Statutory authority, Electoral expenditures funds a part of the costs incurred by the Office of the Commissioner of Canada Elections (OCCE) to ensure the compliance and enforcement of the Canada Elections Act. The OCCE’s functions were carried out under Elections Canada prior to October 1, 2014. Therefore, expenditures related to the OCCE’s activities are reported under Elections Canada for the previous quarters in 2014-2015 and for 2013-2014.

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
December 31, 2014
Year to date used at quarter-end   Planned expenditures for the year ended
March 31, 2014
Expended during the quarter ended
December 31, 2013
Year to date used  at quarter-end
Expenditures:
Total net budgetary expenditures 175,222 37,887 114,960   189,011 40,838 123,315
Personnel 129,622 30,680 90,720   138,964 31,907 99,018
Transportation and communications 9,731 1,250 3,463   6,860 1,609 4,087
Information 885 144 384   875 151 428
Professional and special services 45,354 11,395 26,976   48,992 11,230 26,913
Rentals 1,546 474 911   1,435 273 681
Repair and maintenance 1,436 100 258   5,131 1,340 2,982
Utilities, materials and supplies 1,659 348 855   966 404 880
Acquisition of machinery and equipment 2,209 141 307   2,605 157 530
Other subsidies and payments 5,522 17 4,064   5,925 73 639
Total gross budgetary expenditures 197,964 44,549 127,938   211,753 47,144 136,158
Less Revenues netted against expenditures:
Legal Services 22,742 6,662 12,978   22,742 6,306 12,843
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