Archived - Quarterly Financial Report - For the Quarter Ended June 30, 2014

Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes CanNor's spending authorities granted by Parliament and those used by the Department consistent with the Main Estimates for the 2014-2015 fiscal year. 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.

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. For 2014-2015, the Main Estimates were tabled on February 27, 2014.

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.

As part of the departmental performance reporting process, CanNor prepares its annual departmental financial statements on a full accrual basis in accordance with Treasury Board accounting policies, which are based on Canadian generally accepted accounting principles for the public sector. However, the spending authorities voted by Parliament remain on an expenditure basis.

Statement of Authorities

As at June 30, 2014, total authorities available for fiscal year 2014-2015 amounted to $30.9M, a $20.8M reduction from the same point last year.

The large difference is primarily due to sunsetting in 2013-2014 of the Strategic Investments in Northern Economic Development (SINED) program funding, which included $17M in contribution funds and $2.9M in operating funds (Renewal of SINED was announced in Budget 2014 and was funded in 2014-2015 Supplementary Estimates A).

The remaining difference of $1.1M is the result of the following items: Additional funding for the Northern Projects Management Office (NPMO) project of $1.9M (although there was funding for 2013-2014 available it was not approved until 2013-2014 Supplementary Estimates C); new funding of $80K for the Economic Development Initiative (EDI); finally the sunsetting of the Community Infrastructure Improvement Fund (CIIF) resulted in a decrease of $3.2M. Other minor statutory and program adjustments make up the difference.

Statement of Departmental Budgetary Expenditures by Standard Object

Compared to the previous year, total budgetary expenditures recorded in the quarter ending June 30, 2014 increased by $74K, from $2.739M to $2.813M.

Personnel costs of $2.5M are very similar to the previous quarter. They also include $517K of isolated post allowances, and this amount is higher than the previous year by $133K particularly because of new hiring in the northern offices. The increase in isolated post allowances offsets a net decrease in salaries of approximately the same amount.

Transfer payments decreased by $104K in the quarter. This decrease relates to timing differences for contribution payments. The other differences are highlighted below.

Non-transfer payment reporting objects reflected an overall increase in expenses of $178K. The reporting objects to highlight are:

1. Transportation and communications decreased by $48K in the first quarter, mostly because of lower travel and delayed payments for travel expenses resulting from the implementation of the new financial and travel systems.
2. Professional and Special Services costs are $33K lower as a result of timing differences with invoicing from other governmental service partners.
3. The increase of $264K in other subsidies and payments is mainly due to a one-time transition payment of $262K for implementing salary payment in arrears by the Government of Canada.

All other reporting objects had only minor differences.

Budget 2012 Implementation

The Canadian Northern Economic Development Agency has achieved total Budget 2012 savings of $2.4M last fiscal year by reducing and optimizing office space, implementing more efficient business processes, reducing program funding to respond to a degree of overlap and duplication, and more closely aligning resources to its core mandate.

New President

On July 2, 2014, Janet King started as the new President of the Canadian Northern Economic Development Agency.

Approved by:

Statement of Authorities (unaudited)

Departmental budgetary expenditures by Standard Object (unaudited)