Quarterly Financial Report for the quarter ended June 30, 2012

Quarterly Financial Report of

TransportATION APPEAL TRIBUNAL OF CANADA
(Unaudited)

For the quarter ended June 30, 2012

1. Introduction

This quarterly financial report has been prepared by the management of the Transportation Appeal Tribunal of Canada (TATC) and Transport Canada as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by Treasury Board Accounting Standard 1.3. This quarterly report should be read in conjunction with the Main Estimates and Supplementary Estimates A as well as Canada's Economic Action Plan 2012 (Budget 2012).

1.1 Authority, Mandate and Program Activities

A summary description of TATC's program activities can be found in Part II of the Main Estimates.

1.2 Basis of Presentation

As part of the Parliamentary business of supply, the Main Estimates must be tabled in Parliament on or before March 1 preceding the new fiscal year. Budget 2012 was tabled in Parliament on March 29, after the tabling of the Main Estimates on February 28, 2012. As a result the measures announced in the Budget 2012 could not be reflected in the 2012-13 Main Estimates.

In fiscal year 2012-2013, frozen allotments will be established by Treasury Board authority in departmental votes to prohibit the spending of funds already identified as savings measures in Budget 2012. In future years, the changes to departmental authorities will be implemented through the Annual Reference Level Update, as approved by Treasury Board, and reflected in the subsequent Main Estimates tabled in Parliament.

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes TATC's spending authorities granted by Parliament and those used by TATC consistent with the Main Estimates and Supplementary Estimates (A) for the 2012-2013 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 monies 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.

1.2 Basis of Presentation (cont'd)

TATC 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 and published in the Departmental Performance Report. However, the spending authorities voted by Parliament remain on an expenditure basis.

This quarterly report has not been subject to an external audit or review.

2. Highlights of Fiscal Quarter and Fiscal Year to Date (YTD) Results

2.1 Statement of Authorities

The statement attached at the end illustrates authorities used for the quarter as well as authorities used to date for both the current and previous fiscal year. TATC's authorities available for use at the end of the first quarter of 2012-2013 decreased by approximately $3,000 when compared to the same quarter of the previous fiscal year, primarily due to a decrease of the statutory authorities available for use for employee pay benefits.

The authorities used during the first quarter of 2012-2013 for program expenditures and statutory items were approximately $3,000 higher than in the same quarter of 2011-2012. This increase in expenditure is explained under section 2.2 Statement of Departmental Budgetary Expenditures by Standard Object.

This statement also illustrates that the authorities used in the first quarter of 2012-2013, expressed as a percentage of authorities available for the whole year, were similar as in the first quarter of 2011-2012. Approximately 24% of authorities available for use were expended during the first quarter of 2012-2013, whereas 24% were expended in the first quarter of 2011-2012.

2.2 Statement of Departmental Budgetary Expenditures by Standard Object

In the quarter ended June 30, 2012 total expenditures of the TATC increased by approximately $3,000 when compared with the same period of 2011-2012. This is primarily the result of:

  • Increase in Personnel expenditures by $12,300:

This variance is explained mainly by the Assistant to the Executive Services Manager position being filled;

2.2 Statement of Departmental Budgetary Expenditures by Standard Object (cont'd)

  • Decrease of Transportation and communication expenditures by $26,700:

This variance is mainly explained by a reduction of travelling expenses incurred by Tribunal Members to attend Hearings;

  • Increase of Professional services expenditures by $17,000:

The variance is mainly explained by increased use of temporary help and translation services.

3. Risks and Uncertainties

TATC's Report on Plans and Priorities (RPP) identifies the current risk environment and TATC's key risk areas to the achievement of its strategic outcomes.  Within this context, specific financial risks relative to the first quarter include the following: 

Budget 2010 announced that the operating budgets of departments would be frozen at their 2010-2011 levels for fiscal years 2011-2012 and 2012-2013.  There is a risk that TATC's capacity to address emerging financial pressures will decrease as a result of these cost containment measures.  TATC has implemented strategies to manage the operating budget freeze, including expenditure restraint in discretionary spending and re-allocation of planned spending from lower to higher priorities.

TATC has forecast an increased volume of cases and is assessing ways to manage the associated increase in workload. There is a risk that there will be insufficient capacity to manage this risk.

4. Significant Changes in Relation to Operations, Personnel and Programs

In 2012-2013 the TATC's activities remained substantially the same as in the previous year. However, there is an increase in the number of Review and Appeal Hearings, which can be attributed to the Marine sector.

5. Budget 2012 Implementation

TATC was not affected by any savings measures announced in Budget 2012.

However, in line with the Government's agenda to generate savings, TATC will be implementing efficiency measures to reduce operating costs, while dealing with an increase in the number of Review and Appeal Hearings.

Approved by:

­­­­­­­­­­­­­­­­­­­­­­­­­________________________ ________________________
Richard Hall,        André Morency,

Chairperson, TATC Chief Financial Officer, Transport Canada  

Ottawa, Canada Ottawa, Canada

August 29, 2012 August 29, 2012

Statement of Authorities (unaudited)

(in dollars) 

Fiscal year 2012-2013

 

Fiscal year 2011-2012

Total available for use for the year ending March 31, 2013 *

Used

during the quarter ended
June 30, 2012

Year to date (YTD) used at quarter-end

 

Total available for use for the year ending March 31, 2012 *

Used

during the quarter ended
June 30, 2011

Year to date (YTD) used at quarter-end

 

Vote 55 - Operating expenditures

1,284,898

312,697

312,697

 

1,284,898

309,221

309,221

Budgetary statutory authorities

             

Employee Benefit Plan

126,878

31,720

31,720

 

129,762

32,441

32,441

               

Total authorities

1,411,776

344,417

344,417

 

1,414,660

341,662

341,662

* 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

 

Fiscal year 2011-2012

Planned expenditures for the year ending March 31, 2013

Expended during the quarter ended June 30, 2012

Year to date used at quarter-end

 

Planned expenditures for the year ending March 31, 2012

Expended during the quarter ended June 30, 2011

Year to date used at quarter-end

Expenditures:

             

Personnel

847,776

217,487

217,487

 

850,660

205,208

205,208

Transportation and communications

200,000

22,305

22,305

 

122,000

48,976

48,976

Information

25,000

238

238

 

27,000

195

195

Professional and special services

309,000

97,679

97,679

 

357,000

80,800

80,800

Rentals

25,000

3,601

3,601

 

24,000

4,969

4,969

Repair and maintenance

5,000

-

-

 

6,000

-

-

Utilities, materials and supplies

-

1,832

1,832

 

28,000

994

994

Acquisition of machinery and equipment

-

1,275

1,275

 

-

520

520

Other subsidies and payments

-

-

-

 

-

*-

*-

Total gross budgetary expenditures

1,411,776

344,417

344,417

 

1,414,660

341,662

341,662

* Comparative figure has been reclassified to conform to the current year's presentation; previously stated at $314.