Quarterly Financial Report for the Quarter Ended June 30, 2011
The Office of the Registrar of the Supreme Court of Canada
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. This quarterly report should be read in conjunction with the Main Estimates. 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 the Report on Plans and Priorities 2011-2012.
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 for the 2011-2012 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 ResultsFootnote 1
This section highlights the changes in authorities provided and expenditures incurred as at June 30, 2011 compared to the same quarter of the prior year. Overall, the Office's authorities increased by 1% while the quarterly spending increased by 6% over the same quarter ending June 30, 2010. The overall proportion of authorities used (23%) is in line with that of the previous year (22%).
Changes to Granted Authorities
As at June 30, 2011, the total authorities provided to the Office of the Registrar of the Supreme Court of Canada increased by $313,785, compared to the same quarter of the prior year. This net increase consists of an increase in both:
- Vote 50 – Net Operating Expenditures ($84,146); and
- Budgetary Statutory authorities ($229,639).
As indicated in the Statement of Authorities, the net increase in Vote 50 – Net Operating Expenditures ($84,146) in 2011-12 consists of:
- An on-going increase in personnel funding arising from the law group (LA) collective agreement settlement ($203,162);
- A residual increase in various other collective agreements ($30,463);
- A permanent reduction to reference levels for the termination of temporary funding that was received for the Federal Public Service Student Employment initiative ($16,812); and
- A reference level reduction for collective agreements as part of the operating budget freeze measures ($132,667).
The net increase in the Budgetary Statutory authorities ($229,639) consists of:
- An increase in personnel funding ($80,300) for the Judges' salaries and annuities; and
- An increase in the contributions to employee benefit plans ($149,339).
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 2009-10, then the same ratio of 20% is used to determine the planned expenditures for 2011-12.
A significant variance between planned expenditures in 2010-11 and 2011-12 was noted in "Other subsidies and Payments" (total variance of $1,917,452). This is due to the fact that depreciation, which is part of "Other subsidies and Payments", was included in the total allocation of planned expenditures for 2010-11. Given that the Main Estimates are based on an expenditure basis of accounting, as opposed to an accrual basis, the depreciation expense was removed in the allocation of the 2011-12 planned expenditures. The funding that was previously allocated to depreciation was reallocated to other standard objects of expenditures for 2011-12, which explains the variances noted in the other categories of planned expenditures.
Significant Changes to Budgetary Expenditures
As at June 30, 2011, the total net budgetary expenditures increased by 6% ($366,572) compared to the same quarter of the previous fiscal year. This variance is comprised of both:
- A decrease (9%) in Vote 50 – Net Operating Expenditures; and
- An increase (60%) in Budgetary Statutory spending.
The decrease of 9% ($456,227) 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 mainly due to a large retroactive settlement ($423,894) of the law group collective agreement (LA) that was paid out in the first quarter of 2010-11. There were no such payments in the first quarter of 2011-12.
The increase of 60% ($822,799) was noted in the total expenditures in the Budgetary Statutory authority. In the first quarter of 2011-12, system generated salary accruals ($756,764) were accrued in error and have since been adjusted for the second quarter of 2011-12.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 First Quarter Authorities Granted and Used
Description of image
Comparison of First Quarter Authorities Granted and Used – The diagram illustrates the variation in thousands of dollars for the Annual Net Budgetary Authorities Granted, the authorities used – Vote 50 – Net Operating Expenditures and the authorities used – Budgetary Statutory Authorities as at June 30, 2010 and 2011.
Annual Net Budgetary Authorities Granted – Figures showing the amounts the Office planned to spend as at June 30, 2010 and 2011: $29,401,230 in 2010-11 and $29,715,015 in 2011-12.
Authorities used – Vote 50 – Net Operating Expenditures – Figures showing the amounts the Office received: $5,058,295 for the first quarter of 2010-11 and $4,602,069 for the first quarter of 2011-12.
Authorities used – Budgetary Statutory Authorities – Figures showing the amounts the Office received: $1,365,730 for the first quarter of 2010-11 and $2,188,528 for the first quarter of 2011-12.
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 27, 2011.
The Office of the Registrar of the Supreme Court of Canada is funded through voted parliamentary spending authorities (73%) and statutory authorities (27%) for operating and personnel expenditures. The authorities have remained fairly stable over time, with slight variations due to the settlement of collective agreements and other mandatory pay list requirements.
Although stable funding has enabled the Office to predict future resources, the Office has also had to absorb increased operational costs and investments in strategic priorities within the existing reference levels.
For instance, significant investments were made over the last four years in modernizing the Courtroom and enhancing electronic access to the public and litigants. However paper-based processes continue to be required. Although the Office has mitigated this risk by establishing renewed governance, grouping four core branches into one Court Operations Sector, efficiencies will take time to harness and the increased costs are for the moment absorbed within existing reference levels.
The Office mitigates its overall risks by integrating risk management strategies with annual and long term business planning. A Corporate Risk Profile is also developed and updated annually. Funding priorities are carefully assessed and a risk based approach is used in determining a funding allocation formula that optimizes the available resources.
Budget 2010 announced that departments would not be funded for the 2010-2011 to 2012-2013 wage and salary increases resulting from collective agreements. As departments must pay the salary increases to employees, organizations are expected to find efficiencies within their operating vote to fund these increases. The financial impact on the Office of this government-wide initiative was $104,289 in 2010-2011 and $132,919 in 2011-12. The Office has accommodated the reduction in funding for 2010-11 and 2011-12 without significantly impacting its operations. Management is reviewing various options to address the increasing reductions in funding for fiscal year 2012-2013.
The Office's most significant expenditure is personnel representing 72% of its planned expenditures. Over the last few years, the Office has faced a higher level of attrition that is expected to continue for the next couple years, especially due to retirement. An ongoing challenge for the Office is to maintain staffing at a level sufficient to compensate for departures. Given the Office's small size, the departure or hiring of a handful of employees in one quarter can have a significant impact on the quarter's expenditures and resource management. Despite the level of attrition, the Office has maintained fairly stable personnel costs between both quarters.
4. Significant Changes to Operations, Personnel and Programs
The Office's program is very stable, with limited change from year to year. There were no changes in the Office's program over this reporting period.
From an Internal Services perspective, the IT Solutions & Development branch was merged with the Corporate Services Sector in June 2011. The merger will enable the Office to strengthen an integrated business planning function with Finance, Human Resources, IT and Security across the entire organization.
Approval by Senior Officials
Roger Bilodeau, Q.C., Registrar
August 10, 2011
Catherine Laforce, Chief Financial Officer
Statement of Authorities (unaudited)
|Fiscal year 2011-2012|
|Total available for use for the year ending March 31, 2012*||Used during the quarter ended June 30, 2011||Year to date used at quarter-end|
|Vote 50 - Net Operating expenditures||21,716,101||4,602,069||4,602,069|
|Budgetary statutory authorities||7,998,914||2,188,528||2,188,528|
|Fiscal year 2010-2011|
|Total available for use for the year ending March 31, 2011*||Used during the quarter ended June 30, 2010||Year to date used at quarter-end|
|Vote 50 - Net Operating expenditures||21,631,955||5,058,295||5,058,295|
|Budgetary statutory authorities||7,769,275||1,365,730||1,365,730|
* Includes only Authorities available for use and granted by Parliament at quarter-end.
Departmental Budgetary Expenditures by Standard Object (unaudited)
|Fiscal year 2011-2012|
|Planned expenditures for the year ending March 31, 2012||Expended during the quarter ended June 30, 2011||Year to date used at quarter-end|
|Transportation and communications||1,606,364||192,479||192,479|
|Professional and special services||3,078,428||350,403||350,403|
|Repair and maintenance||375,358||12,088||12,088|
|Utilities, materials and supplies||1,865,219||251,756||251,756|
|Acquisition of machinery and equipment||999,021||35,252||35,252|
|Other subsidies and payments||-||(745)||(745)|
|Total net budgetary expenditures||29,715,015||6,790,597||6,790,597|
|Fiscal year 2010-2011|
|Planned expenditures for the year ending March 31, 2011||Expended during the quarter ended June 30, 2010||Year to date used at quarter-end|
|Transportation and communications||1,087,620||193,883||193,883|
|Professional and special services||2,197,743||389,344||389,344|
|Repair and maintenance||646,825||13,071||13,071|
|Utilities, materials and supplies||1,199,774||269,201||269,201|
|Acquisition of machinery and equipment||1,114,690||15,009||15,009|
|Other subsidies and payments||1,917,452||15,586||15,586|
|Total net budgetary expenditures||29,401,230||6,424,025||6,424,025|
- Footnote 1
As the year to date results are equivalent to the first quarter results, the year to date comparison will not be referred to in the present report.
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