Quarterly financial report for the quarter ended September 30, 2018

ISSN 2369-7938

Introduction

This quarterly 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 and Supplementary Estimates.

The Transportation Safety Board’s (TSB) sole objective is to advance transportation safety. This mandate is fulfilled by conducting independent investigations into selected transportation occurrences. The purpose of these investigations is to identify the causes and contributing factors and the safety deficiencies evidenced by an occurrence. The TSB then reports publicly and makes recommendations to improve safety and reduce or eliminate risks to people, property and the environment.

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

Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Transportation Safety Board’s spending authorities granted by Parliament and those used by the department. Authorities include amounts granted through the Main and Supplementary Estimates for the 2018-19 fiscal year and any respendable revenue earned and available for use to quarter end. 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.

As part of the departmental performance reporting process, the TSB 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.

Highlights of fiscal quarter and fiscal year to date results

Statement of authorities

The TSB received $30,188,952 in funding through the Main Estimates. During the second quarter, the TSB received its operating budget carry forward (OBCF) from 2017-18 which represents an increase in authorities of $361,203. The TSB has additional statutory authorities totaling $30,000 at the end of the second quarter generated by proceeds from the disposal of surplus Crown assets and its authority to respend revenues as a departmental corporation.

The TSB’s total authorities available for use decreased by $164,000 between fiscal years 2017-18 and 2018-19. This is explained mainly by a lower OBCF of $947,797 compared to previous year, offset by $760,000 of additional funding provided by the Treasury Board Secretariat (TBS) for collective agreements in 2018-19, as well as fluctuations in the Employee Benefit Plan (EBP) percentage, which is a rate set annually by TBS.

Statement of departmental budgetary expenditures

The department’s year-to-date spending is lower by $1,420,000 or 10% in the current year compared to 2017-18. This significant difference is due to higher salary expenditures in previous year due to the department’s obligation to pay retroactive salaries to its employees, as a result of signed and ratified collective agreements. These payments constituted liabilities for the department, which were promptly liquidated last fiscal year. Thus far in 2018-19, such payments are minimal.

As illustrated in Figure 1, the TSB has spent approximately 45% of its authorities at the end of the second quarter. This percentage is slightly lower than expected at mid-year mainly due to timing delays in the procurement process for some capital equipment.

Figure 1. Second quarter expenditures compared to annual authorities
Graph of second quarter expenditures compared to annual authorities

Risks and uncertainties

After a thorough A-base review conducted last fiscal year, it was evident that the TSB did not have enough funding to support its annual ongoing operations, causing the TSB’s program integrity to be at risk. In order to address this serious issue, the TSB worked with the Treasury Board Secretariat to request ongoing funding to resolve the funding shortfall. This request was presented and approved by Treasury Board at the end of the second quarter, with funding anticipated to be released during the third quarter.

A continuous risk to the TSB’s financial situation is that expenditures are greatly influenced by the number and complexity of transportation occurrences. A significant transportation accident or a flurry of smaller size occurrences could significantly increase expenditures and result in additional resource pressures that could require the department to seek further funding from Parliament.

As a departmental corporation, the TSB has authority to spend revenues received during the year although such revenues are minimal; on average less than 1% of the department’s funding requirements.

Significant changes in relation to operations, personnel and programs

There have been no significant changes in relation to operations, personnel and programs in the current year.

Approval by senior officials

Approved by,

Source document signed by
Kathleen Fox
Chair

Source document dated 2018-12-17
Date
Gatineau, Canada

Source document signed by
Luc Casault, CPA, CGA
Chief Financial Officer

Source document dated 2018-11-28
Date
Gatineau, Canada

Statement of authorities (unaudited)

Fiscal year 2018-19 (in thousands of dollars)Footnote 1
  Total available for use for the year ending March 31, 2019 Expended during the quarter ended September 30, 2018 Year to date used at quarter-end
Vote 1 - Net operating expenditures 27,323 6,079 12,215
Statutory authorities - Employee Benefit Plans 3,227 807 1,614
Statutory authorities - Spending of proceeds from the disposal of surplus Crown assets 26 2 2
Statutory authorities - Expenditures Paragraph 29.1(1) of the Financial Administration Act 4 4 4
Total authorities 30,580 6,892 13,835
Fiscal year 2017-18 (in thousands of dollars)Footnote 1
  Total available for use for the year ending March 31, 2018 Expended during the quarter ended September 30, 2018 Year to date used at quarter-end
Vote 1 - Net operating expenditures 27,511 7,685 13,648
Statutory authorities - Employee Benefit Plans 3,214 803 1,607
Statutory authorities - Spending of proceeds from the disposal of surplus Crown assets 11 - -
Statutory authorities - Expenditures Paragraph 29.1(1) of the Financial Administration Act 8 - -
Total authorities available for use 30,744 8,488 15,255

Statement of expenditures by standard object (unaudited)

Fiscal year 2018-19 (in thousands of dollars)Footnote 1
Expenditures: Planned expenditures for the year ending March 31, 2019 Expended during the quarter ended September 30, 2018 Year to date used at quarter-end
Personnel 24,462 5,990 12,143
Transportation and communications 1,770 292 609
Information 177 36 84
Professional and special services 1,985 194 450
Rentals 422 40 120
Repair and maintenance 421 120 132
Utilities, materials and supplies 219 92 125
Acquisition of land, building and works 4 - -
Acquisition of machinery and equipment 1,116 124 168
Other subsidies and payments 4 4 4
Total net budgetary expenditures 30,580 6,892 13,835
Fiscal year 2017-18 (in thousands of dollars)Footnote 1
Expenditures: Planned expenditures for the year ending March 31, 2018 Expended during the quarter ended September 30, 2018 Year to date used at quarter-end
Personnel 24,999 7,539 13,606
Transportation and communications 1,630 326 560
Information 148 21 66
Professional and special services 2,519 374 569
Rentals 453 50 179
Repair and maintenance 413 96 102
Utilities, materials and supplies 209 29 94
Acquisition of land, building and works 63 - -
Acquisition of machinery and equipment 310 53 79
Other subsidies and payments - - -
Total net budgetary expenditures 30,744 8,488 15,255
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