Quarterly Financial Report for the Quarter Ended September 30, 2016

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). It should be read in conjunction with the Main Estimates, Supplementary 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 Programs

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. The Supreme Court of Canada is an important national institution, positioned at the pinnacle of the judicial branch of government in Canada, separate from and independent of the executive and legislative branches of government.

The Office of the Registrar of the Supreme Court of Canada (ORSCC) 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 information on the ORSCC’s authority, mandate and programs may be found in its Report on Plans and Priorities 2016-2017.

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 ORSCC’s spending authorities granted by Parliament and those used by the ORSCC, consistent with the Main Estimates, Supplementary Estimates and approved allotment transfers from Treasury Board Central Votes for the 2016-17 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.

The ORSCC 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, 2016 compared to the same quarter of the prior year. Overall, the ORSCC’s authorities increased by 8% while quarterly spending increased by 23% over the same quarter ending September 30, 2015. The overall proportion of authorities used on a year-to-date basis (43%) is in line with that of the previous year (43%).

2.1 Changes to Granted Authorities

As at September 30, 2016, the total authorities provided to the ORSCC have increased by $2,495,398 compared to the same quarter of the prior year. This net increase consists of:

Previously reported:

• An increase in Vote 50 – Net Operating Expenditures ($2,034,899); and
• An increase in Budgetary Statutory authorities ($431,640).

Current quarter:

• An increase in Vote 50 – Net Operating Expenditures ($28,859) in the second quarter of 2016-17 which consists mainly of contributions toward Central Agency initiatives in 2015-16, which have not yet occurred in 2016-17; and
• The Operating Budget Carry Forward was received in this quarter ($1,115,242). Funding for this item was comparable to the same quarter last year, resulting in a nil variance between quarters.

2.2 Changes to Planned Expenditures

The allocation of planned expenditures slightly differs between both fiscal years due to funding received to enhance security at the Supreme Court of Canada in the first quarter of 2016-17. Additional authorities of $1,115,242 received for the Operating Budget Carry Forward in the second quarter of 2016-17 will be distributed within non-salary categories in proportion to the standard object distribution within the 2016-17 Main estimates.

2.3 Significant Changes to Budgetary Expenditures

As at September 30, 2016, total net budgetary expenditures increased by 8% ($1,067,569) compared to the same quarter of the previous year. This variance comprises:

Previously reported:

• A decrease of 8% ($540,472) in net budgetary expenditures explained by:
  • A decrease of 9% ($476,907) in Vote 50 – Net Operating Expenditures; and
  • A decrease of 4% ($63,565) in Budgetary Statutory spending

Current quarter:

• An increase of 23% ($1,608,041) in net budgetary expenditures explained by:
  • An increase of 30% ($1,439,270) in Vote 50 – Net Operating Expenditures; and
  • An increase of 7% ($168,771) in Budgetary Statutory expenditures.

The above increase of 30% ($1,439,270) was noted in Vote 50 – Net Operating Expenditures in comparison to the same quarter of the previous year. The variance between the two quarters is attributed to:

• A net salary increase of $770,652 due mainly to timing differences in the pay processing schedules between both fiscal years; and
• A net non-salary increase of $668,618 mainly resulting from investments made in enhancing security and for replenishing core information technology assets.

The net increase of 7% ($168,771) was noted in Budgetary Statutory Expenditures in comparison to the same quarter of the previous year. The variance between the two quarters is essentially attributed to increases in statutory pension expenditures as well as in relocation expenditures. Other expenditures have remained stable in comparison to the same quarter of the previous year.

Figure 1: Comparison of Authorities Granted and Used

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 during the Second Quarter - Vote 50 - Net Operating Expenditures and the Authorities Used during the Second Quarter - Budgetary Statutory Authority as at September 30, 2015 and 2016.

Annual Net Budgetary Authorities Granted – Figures showing the amounts the ORSCC planned to spend as at September 30, 2015 and 2016: $32,850,326 in 2015-16 and $35,345,724 in 2016-17.

Year to Date Used – Figures present the cumulative amounts the ORSCC spent as at September 30, 2015 and 2016 respectively: $14,109,945 and $15,177,514.

Authorities used During the Second Quarter - Vote 50 - Net Operating Expenditures – Figures showing the amounts the ORSCC spent: $4,742,761 for the second quarter of 2015-16 and $6,182,031 for the second quarter of 2016-17.

Authorities used During the Second Quarter– Budgetary Statutory Authority – Figures showing the amounts the ORSCC spent: $2,384,215 for the second quarter of 2015-16 and $2,552,986 for the second quarter of 2016-17.

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 23, 2016.

The ORSCC is funded through voted parliamentary spending authorities (72%) and statutory authorities (28%) for operating and personnel expenditures.

With the exception of funding received for enhancing security in 2016-17, the ORSCC’s operating budget has remained fairly stable for several years. The fiscal restraint on its operations continues to pose a serious challenge as the organization must continue to absorb rising operating costs which results in limited funding available for investments in its current asset base and strategic priorities. Mandatory contributions to Central Agency initiatives also create further financial pressures.

Following the 2013 Speech from the Throne, the ORSCC, like other government departments, must also contend with an operating budget freeze.  Funding for wage and salary increases taking effect during fiscal years 2014-15 and 2015-16 will not be received; nor will the ongoing impact of these adjustments be funded in the future.

The ORSCC continues to reduce its financial risks by dedicating time and effort to ensure that all resources are used in the most efficient and effective manner possible. Opportunities aimed at increasing efficiency and reducing costs remain a priority for the organization. Strategies aimed at prioritizing new investments while postponing others that are less critical to the operations are utilized. Greater financial controls and improved resource planning and forecasting are also helping to mitigate these risks. Despite these strategies, gaps still exist and the ORSCC must be strategic in its approach to prioritization and resource allocation.

4. Significant Changes to Operations, Personnel and Programs

The Honourable Mr. Justice Thomas A. Cromwell retired on September 1, 2016. Financial impacts were minimal in the second quarter of 2016-17.

There were no other significant changes in the ORSCC’s operations, personnel and programs over this reporting period.

Approval by Senior Officials

Approved by:

 

Original signed by

Roger Bilodeau, Q.C., Registrar
Ottawa, Ontario

November 15, 2016

 

Original signed by 

Catherine Laforce, Chief Financial Officer

 

Statement of Authorities (unaudited)
(in dollars)

Fiscal year 2016-2017

	Total available for use for the year ending March 31, 2017*	Used during the quarter ended September 30, 2016	Year to date used at quarter-end
Vote 50 - Net Operating expenditures	25,454,987	6,182,031	11,087,474
Budgetary statutory authorities	9,890,737	2,552,986	4,090,040
Total authorities	35,345,724	8,735,017	15,177,514

Fiscal year 2015-2016

	Total available for use for the year ending March 31, 2016*	Used during the quarter ended September 30, 2015	Year to date used at quarter-end
Vote 50 - Net Operating expenditures	23,391,229	4,742,761	10,125,112
Budgetary statutory authorities	9,459,097	2,384,215	3,984,833
Total authorities	32,850,326	7,126,976	14,109,945

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

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

Fiscal year 2016-2017

Expenditures	Planned expenditures for the year ending March 31, 2017	Expended during the quarter ended September 30, 2016	Year to date used at quarter-end
Personnel	23,675,602	6,621,133	12,115,696
Transportation and communications	1,689,510	470,284	613,149
Information	172,941	5,150	5,674
Professional and special services	4,163,813	500,825	878,821
Rentals	1,093,956	193,327	339,475
Repair and maintenance	324,287	28,388	37,421
Utilities, materials and supplies	2,235,867	290,134	499,759
Acquisition of machinery and equipment	1,881,197	631,310	665,241
Other subsidies and payments	108,551	(5,534)	22,278
Total net budgetary expenditures	35,345,724	8,735,017	15,177,514

Fiscal year 2015-2016

Expenditures	Planned expenditures for the year ending March 31, 2016	Expended during the quarter ended September 30, 2015	Year to date used at quarter-end
Personnel	23,071,582	5,782,807	11,845,588
Transportation and communications	1,944,955	415,557	662,021
Information	235,042	15,917	16,560
Professional and special services	2,493,473	290,104	548,766
Rentals	1,118,775	227,696	274,717
Repair and maintenance	362,845	26,099	36,150
Utilities, materials and supplies	2,449,739	271,838	514,042
Acquisition of machinery and equipment	1,133,494	106,653	206,694
Other subsidies and payments	40,421	(9,695)	5,407
Total net budgetary expenditures	32,850,326	7,126,976	14,109,945