Quarterly Financial Report for the Quarter Ended September 30, 2012

The Office of the Registrar of the Supreme Court of Canada

1. Introduction

This quarterly financial 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 (TB). This quarterly report should be read in conjunction with the Main Estimates and approved allotment transfers from Treasury Board Central Votes. It has not been subject to an external audit or review.

1.1 Authority, Mandate and Program Activities

Created by an Act of Parliament in 1875, the Supreme Court of Canada is Canada's final court of appeal. It serves Canadians by deciding legal issues of public importance, thereby contributing to the development of all branches of law applicable within Canada. The independence of the Court, the quality of its work and the esteem in which it is held both in Canada and abroad contribute significantly as foundations for a secure, strong and democratic country founded on the Rule of Law. In accordance with the Supreme Court Act, the Supreme Court of Canada consists of the Chief Justice and the eight puisne judges. The Supreme Court of Canada is an important national institution, positioned at the pinnacle of the judicial branch of government in Canada.

The Office of the Registrar of the Supreme Court of Canada (Office) provides all necessary services and support for the Court to process, hear and decide cases.  It also serves as the interface between litigants and the Court.

Further details on the Office's authority, mandate and program activities may be found in its Report on Plans and Priorities 2012-2013.

1.2 Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Office's spending authorities granted by Parliament and those used by the Office, consistent with the Main Estimates and approved allotment transfers from Treasury Board Central Votes for the 2012-13 fiscal year. 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.

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 Office 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.

2. Highlights of Fiscal Quarter and Fiscal Year to Date Results

This section highlights the changes in authorities provided and expenditures incurred as at September 30, 2012 compared to the same quarter of the prior year. Overall, the Office's authorities decreased by 3% while the quarterly spending increased by 7% over the same quarter ending September 30, 2011. The overall proportion of authorities used on a year-to-date basis (45%), is in line with that of the previous year (43%).

Changes to Granted Authorities

As at September 30, 2012, the total authorities provided to the Office of the Registrar of the Supreme Court of Canada have decreased by $881,210, compared to the same quarter of the prior year.  This net decrease consists of:

An increase of $101,843 in the previously reported:

  • First quarter
    • Vote 50 – Net Operating Expenditures ($4,912); and
  • Budgetary Statutory authorities ($96,931).
    • A decrease in the current quarter:
    • Vote 50 – Net Operating Expenditures ($983,053).

The decrease in Vote 50 – Net Operating Expenditures ($983,053) in the second quarter of 2012-13 consists of:

  • A $148,341 decrease in authorities from TB Vote 25 with the Operating Budget Carry Forward amounting to $1,081,598 in 2011-12, compared to $933,257 in 2012-13; and
  • An allocation from TB Vote 30 (Paylist Requirements) in the second quarter of 2011-12 ($834,712) while the first allocation of that item should be granted to the Office in the third quarter of 2012-13.

Changes to Planned Expenditures

The process for allocating planned expenditures in the Main Estimates is based on proportioning prior year actual expenditures against the total authorities available for use for the given year. For instance, if professional services represented 20% of the total operating expenditures of 2010-11, then the same ratio of 20% would be used to determine the planned expenditures for 2012-13.

A significant variance between planned expenditures in 2011-12 and 2012-13 was noted in "Other Subsidies and Payments" (total variance of $456,917). This is due to the fact that the standard object "Other Subsidies and Payments" had been entirely removed from the 2011-12 allocation of Main Estimates under the assumption that it included the depreciation expenses exclusively, which should not affect the Office's authorities available for use. The 2011-12 allocation of Main Estimates was therefore reallocated to other standard objects of expenditures, leaving the "Other Subsidies and Payments" nil. However, in 2012-13, the other expenditures related to this standard object (other than depreciation) were included in the allocation process of the Main Estimates, therefore causing an impact on other standard objects by decreasing their allocated proportion of total authorities available for use and thus generating the variance between both fiscal years.

Significant Changes to Budgetary Expenditures

As at September 30, 2012, the total net budgetary expenditures increased by 7% ($482,894) compared to the same quarter of the previous year. This variance is comprised of:

  • A decrease of 14% ($856,000) in Vote 50 – Net Operating Expenditures; and
  • An increase of 205% ($1,338,894) in Budgetary Statutory spending.

The decrease of 14% ($856,000) was noted in the total operating expenditures (Vote 50) in comparison to the same quarter of the previous year. The variance between both quarters is attributed to:

  • A net salary decrease of $794,704 (93% of total variance) mainly due to severance paid out in the second quarter of 2011-12; and
  • A non-salary decrease of $61,296 (7% of total variance) resulting from:
    • Timing differences;
    • Price variances;
    • Special projects; and/or
    • Fluctuating replacement or maintenance schedule.

The increase of 205% ($1,338,894) was noted in the total Budgetary Statutory expenditures in comparison to the same quarter of the previous year. The variance between both quarters is essentially attributed to:

  • A salary increase of $1,343,654 mainly resulting from:
    • As disclosed in the previous year's quarterly financial reports, system generated salary accruals ($756,764) were accrued in error in the first quarter of 2011-12. These accruals generated erroneously were subsequently reversed in the second quarter of 2011-12, thus causing a large decrease in total statutory expenditures, and therefore, a considerable variance between both quarters; and
    • There was a delay in processing the quarterly statutory pension expenditures in the second quarter of 2011-12, causing a variance when comparing with the second quarter of 2012-13 ($585,987).

Other expenditure categories (for both operating and statutory) have remained fairly stable in comparison to the same quarter of the previous year.

Figure 1: Comparison of Authorities Granted and Used Comparison of Authorities Granted and Used as of September 30, 2011 and 2012

Description of image

Comparison of Second Quarter Authorities Granted and Used – The diagram illustrates the variation in thousands of dollars for the Annual Net Budgetary Authorities Granted, the year to date used, the authorities used – Vote 50 – Net Operating Expenditures and the authorities used – Budgetary Statutory Authorities as at September 30, 2011 and 2012.

Annual Net Budgetary Authorities Granted – Figures showing the amounts the Office planned to spend as at September 30, 2011 and 2012: $31,631,325 in 2011-12 and $30,750,115 in 2012-13.

Year to Date Used – Figures present the cumulative amounts the Office received as at September 30, 2011 and 2012 respectively: $13,736,348 and $13,853,933.

Authorities used – Vote 50 – Net Operating Expenditures – Figures showing the amounts the Office received: $6,293,308 for the second quarter of 2011-12 and $5,437,308 for the second quarter of 2012-13.

Authorities used – Budgetary Statutory Authorities – Figures showing the amounts the Office received: $652,444 for the second quarter of 2011-12 and $1,991,338 for the second quarter of 2012-13.

3. Risks and Uncertainties

This Departmental Quarterly Financial Report reflects the results of the current fiscal period in relation to the Main Estimates for which full supply was released on June 29, 2012.

The Office of the Registrar of the Supreme Court of Canada is funded through voted parliamentary spending authorities (74%) and statutory authorities (26%) for operating and personnel expenditures.

Although stable funding has enabled the Office to predict future resources, it has had to absorb increased operational costs and investments in strategic priorities during the last five years within the existing reference levels. The Office has also been absorbing the wage and salary increases resulting from collective agreements since 2010-11 by finding efficiencies within its operating vote. The financial impact of this government-wide initiative was $132,667 for 2011-12 and is estimated at $262,114 for 2012-13.

In order to respond to the need for operating more efficiently within existing reference levels and to address the changing needs of its various communities of stakeholders, the Office has identified Business Transformation as an operational priority for 2012-13 and beyond.  The Business Transformation initiative will require the implementation of changes to the Office's business processes to make its operations more efficient.  However, change has its challenges, including securing appropriate resources to effect these necessary changes.  As indicated above, the Office has, in recent years, been able to work within its existing reference levels, but some sectors are seeing growing challenges in the quest to deliver current services while implementing change. As a result, internal reallocation of resources may be required to allow necessary business changes, leading to risk of affecting some services, thereby creating an additional challenge and potential increase in operating costs. 

4. Significant Changes to Operations, Personnel and Programs

There were no significant changes in the Office's operations, personnel and programs over this reporting period.

Approval by Senior Officials

Approved by:

 

Roger Bilodeau, Q.C., Registrar
Ottawa, Ontario
November 29, 2012

 

Catherine Laforce, Chief Financial Officer

Statement of Authorities (unaudited)
(in dollars)

  Fiscal year 2012-2013
Total available for use for the year ending March 31, 2013* Used during the quarter ended September 30, 2012 Year to date used at quarter-end
Vote 50 - Net Operating expenditures 22,654,270 5,437,308 10,373,681
Budgetary statutory authorities 8,095,845 1,991,338 3,480,252
 
Total authorities 30,750,115 7,428,646 13,853,933

 

  Fiscal year 2011-2012
Total available for use for the year ending March 31, 2012* Used during the quarter ended September 30, 2011 Year to date used at quarter-end
Vote 50 - Net Operating expenditures 23,632,411 6,293,308 10,895,376
Budgetary statutory authorities 7,998,914 652,444 2,840,972
 
Total authorities 31,631,325 6,945,752 13,736,348

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

Departmental Budgetary Expenditures by Standard Object (unaudited)
(in dollars)

  Fiscal year 2012-2013
Planned expenditures for the year ending March 31, 2013 Expended during the quarter ended September 30, 2012 Year to date used at quarter-end
Expenditures
Personnel 21,361,168 6,069,226 11,418,978
Transportation and communications 1,741,861 313,638 666,183
Information 230,383 30,699 42,357
Professional and special services 3,517,986 442,677 651,904
Rentals 292,155 145,683 227,808
Repair and maintenance 228,563 29,834 69,640
Utilities, materials and supplies 1,865,499 278,768 503,016
Acquisition of machinery and equipment 1,055,583 118,106 274,032
Other subsidies and payments 456,917 15 15
 
Total net budgetary expenditures 30,750,115 7,428,646 13,853,933

 

  Fiscal year 2011-2012
Planned expenditures for the year ending March 31, 2012 Expended during the quarter ended September 30, 2011 Year to date used at quarter-end
Expenditures
Personnel 22,094,037 5,520,277 11,432,969
Transportation and communications 1,791,843 346,307 538,786
Information 269,220 57,337 58,377
Professional and special services 3,483,852 509,763 860,166
Rentals 332,052 24,985 60,616
Repair and maintenance 424,792 28,394 40,483
Utilities, materials and supplies 2,104,939 282,000 533,755
Acquisition of machinery and equipment 1,130,590 171,248 206,500
Other subsidies and payments - 5,441 4,696
 
Total net budgetary expenditures 31,631,325 6,945,752 13,736,348