Quarterly Financial Report For the Quarter ended December 31, 2018

ISSN 2561-7044

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

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 Estimates.

The Office of the Director of Public Prosecutions (ODPP) was created on December 12, 2006, with the coming into force of the Director of Public Prosecutions Act. The ODPP is an independent prosecution service mandated to prosecute offences that are under the jurisdiction of the Attorney General of Canada.

On October 1, 2014, pursuant to amendments to the Canada Elections Act, the Office of the Commissioner of Canada Elections (OCCE) was transferred from Elections Canada to the ODPP. The Commissioner of Canada Elections and the Director of Public Prosecutions exercise their statutory duties independently from each other while operating within the same organization.

The ODPP has two core responsibilities. The first is that prosecution services are provided in an independent, impartial and fair manner. The mandate of the ODPP includes:

The second core responsibility is in respect of the work of the OCCE. It provides that compliance and enforcement activities under the Canada Elections Act and Referendum Act are conducted by the OCCE in an independent, impartial, and fair manner. Activities related to this mandate include:

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 and Supplementary 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 results 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

1. Spending Authorities

At the end of the third quarter of 2018-19, the ODPP had total net spending authorities of $195.6 million available for use as detailed in Chart 1 and Appendix A. This amount represents the 2018-19 Main Estimates and Supplementary Estimates A, the operating budget carry forward from the last fiscal year, funding for renewed collective agreements, paylist allocations to cover expenditures such as parental benefits and an increase in funding for upholding the integrity of Canada Elections. The increase of $3.9 million (2%) compared to total net spending authorities at the same time in fiscal year 2017-18 ($191.7 million) is mainly due to an increase in salary authorities (collective agreement pay increases and new funding to uphold the integrity of Canada Elections), an increase in repair and maintenance for real property projects, offset by a decrease in funding for professional services (collection of outstanding federal fines).

2. Expenditures for the Quarter ended December 31, 2018

During the third quarter of 2018-19, the ODPP had net expenditures of $38.6 million compared to $44.3 million for the same period in 2017-18, as detailed in Appendix B. The decrease of $5.7 million (or 13%) is mainly due to an increase of $6.3 in the collection of respendable revenues compared to the prior year, which is due to timing of invoicing as a result of a delay in the approval of updated legal service rates. The increase in revenues was offset by a small, $0.6 million increase in expenditures. The change in the breakdown of expenditures is primarily the result of the timing of invoices from Other Government Departments (OGD), which will be allocated to specific expenditures prior to year-end.

3. Year-to-date Authorities and Expenditures as at December 31, 2018

At the end of December 2018, the ODPP had net expenditures of $143.6 million (or 73%) of its total net spending authorities of $195.6 million as detailed in Appendix B. At the same time last year, the ODPP had net expenditures of $135.0 million (or 70%) of its total authorities of total net spending authorities of $191.7 million. The increase of $8.6 million is mainly due to an increase of $7.9 million in salary expenditures, primarily from collective agreement pay increases.

Chart 1: Comparison of Budgetary Authorities and Expenditures as of December 31, 2018, and December 31, 2017 (in thousands of dollars)

Graph 1: Comparison of Budgetary Authorities and Expenditures as of December 31, 2018, and December 31, 2017 (in thousands of dollars)

Text Description

The chart presents the ODPP's year-to-date net budgetary authorities and net budgetary expenditures as of December 31 for the fiscal years 2018-19 and 2017-18. The chart also shows the net vote authorities and the revenues netted against expenditures for the same period.

As of December 31, 2018, the net budgetary authorities were $195,640 thousand and the net budgetary expenditures were $143,614 thousand. For the same period in the previous fiscal year, net budgetary authorities and net budgetary expenditures were $191,653 thousand and $135,020 thousand, respectively.

As of December 31, 2018, the net vote authorities were $22,742 thousand and the revenues netted against expenditures were $10,040 thousand. For the same period in the previous fiscal year, net vote authorities and revenues netted against expenditures were $22,742 thousand and $8,876 thousand, respectively.

As of December 31, 2018, the total budgetary authorities, combining net budgetary authorities and net vote authorities totalled $218,382 thousand, and the total budgetary expenditures, combining net budgetary expenditures and revenues netted against expenditures totalled $153,654 thousand. For the same period in the previous fiscal year, the total budgetary authorities and the total budgetary expenditures totalled $214,395 thousand and $143,896 thousand, respectively.

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.

The ODPP does not determine the number or types of cases referred to it for prosecution, nor does it control all of the levers of the criminal justice system. This contributed to a risk that the organization may have insufficient funding to meet its prosecutorial obligations. In order to mitigate this risk, the ODPP continued to monitor its business practices and worked collaboratively with investigative agencies to ensure resources were managed in a cost effective manner through caseload and resource planning. Subsequent to 2017-18 year-end the ODPP strengthened this strategy by implementing additional financial controls and measures, including more frequent monitoring, and renewed discussions with Central Agencies to explore options to augment available funds in alignment with the ODPP’s mandate. These discussions led to the ODPP securing short-term program integrity funding for 2018-19 and 2019-20 while the ODPP continues working to secure additional permanent funding to address on-going financial challenges.

The funding pressures from the Public Services and Procurement Canada (PSPC) with respect to mandated relocations and/or renovations and the implementation of workplace 2.0 also have a significant impact on the budget of the ODPP. The ODPP has developed a Strategic Real Property Plan from 2017 to 2021 that is continually reviewed to realign the funding levels of each project based on urgency.

E. Significant Changes in Relations to Operations, Personnel and Programs

No significant changes were noted during the third quarter of fiscal year 2018-19.

 

Approval by Senior Officials

Approved by:


________________________
Kathleen Roussel
Director of Public Prosecutions and
Deputy Attorney General of Canada


Ottawa, Canada


________________________
Date




_______________________
Mélanie Lamoureux, CPA, CMA
Chief Financial Officer

Appendix A

Statement of Authorities (unaudited)
  Fiscal year 2018-2019   Fiscal year 2017-2018
(in thousands of dollars) Total available for use for the year ending  Mar. 31, 2019Table Note * Used during the quarter ended December 31, 2018 Year to date used at quarter-end    Total available for use for the year ending  Mar. 31, 2018 Used during the quarter ended December 31, 2017 Year to date used  at quarter-end 
Vote 1 - Net Operating expenditures 176,235 34,888 129,751   171,883 38,848 119,222
Budgetary Statutory Authorities:
Contributions to employee benefit plans
18,042 2,988 11,952   18,216 4,554 13,662
Electoral expenditures
1,363 765 1,910   1,554 916 2,136
Total Budgetary statutory authorities 19,405 3,753 13,862   19,770 5,470 15,798
Total Budgetary Authorities 195,640 38,641 143,613   191,653 44,318 135,020
Non-budgetary Authorities 0 0 0   0 0 0
Total Authorities 195,640 38,641 143,613   191,653 44,318 135,020

Table Notes

Table Note *

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

Return to table note *

Appendix B

Departmental budgetary expenditures by Standard Object (unaudited)
  Fiscal year 2018-19   Fiscal year 2017-18
(in thousands of dollars) Planned expenditures for the year ending Mar. 31, 2019 Expended during the
quarter ended December 31, 2018
Year to date used  at
quarter-end 
  Planned expenditures for the year ending Mar. 31, 2018 Expended during the
quarter ended December 31, 2017
Year to date
used at
quarter-end 
Expenditures:
Personnel 145,140 29,249 102,674   136,204 30,534 94,728
Transportation and communications 7,174 1,357 3,722   7,864 1,472 4,026
Information 597 84 265   576 153 377
Professional, special & other services 53,078 14,545 38,327   60,147 15,236 41,347
Rentals 1,748 532 1,417   2,395 636 1,425
Repair and maintenance 5,754 43 691   1,898 310 395
Utilities, materials and supplies 1,432 313 949   1,568 368 931
Acquisition of machinery and equipment 558 130 612   712 233 530
Other subsidies and payments 2,901 2,428 4,997   3,031 (843) 137
Total gross budgetary expenditures 218,382 48,681 153,654   214,395 48,099 143,896
Less Revenues netted against expenditures:
Legal services (22,742) (10,040) (10,040)   (22,742) (3,781) (8,876)
Total net budgetary expenditures 195,640 38,641 143,614   191,653 44,318 135,020
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