Quarterly financial report for the quarter ended September 30, 2017
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 2017-18 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 $29,417,000 in funding through the Main Estimates. During the second quarter, the TSB received its operating budget carry forward (OBCF) from 2016-17 which represents an increase in authorities of $1,309,000. The TSB has additional statutory authorities totaling $19,000 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 $231,000 between fiscal years 2016-17 and 2017-18. This is explained by a $307,000 decrease due to a lower Employee Benefit Plan percentage (set annually by Treasury Board Secretariat), a $65,000 government-wide budget reduction of professional services, advertising and travel and a $13,000 decrease in respendable revenues earned. These decreases are offset by a higher OBCF of $122,000 compared to previous year. The remaining difference of $32,000 is due to a government-wide budget reduction for the Treasury Board Secretariat Back Office Transformation Initiative which was imposed last year, but for which the TSB was not subject to this year.
Statement of departmental budgetary expenditures
The department's year-to-date spending is higher by $800,000 or 6% in the current year compared to 2016-17. This significant difference can be directly attributed to increased salary expenditures for retroactive payments, which were paid out to the majority of the TSB's employees during the second quarter. These retroactive payments were for previous years' economic increases resulting from recently signed and ratified collective agreements. In addition, current year annual salaries have also been increased to reflect these economic increases, further contributing to the higher than normal spending in this category. It should be noted that the TSB did anticipate these additional costs and took action to mitigate the risk, resulting in lower expenditures in almost every other spending category.
As illustrated in Figure 1, the TSB has spent approximately 50% of its authorities at the end of the second quarter. Although the TSB's spending is generally distributed equally throughout the year, this percentage is slightly higher than previous fiscal years at the end of the second quarter.
Risks and uncertainties
The TSB is experiencing a number of resource pressures in 2017-18, most notably the retroactive payouts for newly signed and ratified collective agreements, the majority of which the TSB is expected to cover using its existing appropriations. Although the payouts are being compensated by reduced expenditures in other spending categories as well as earmarked funds in the form of carry forward funding from previous years, the settlements are ultimately higher than expected. The TSB is seeking funding through Supplementary Estimatesto address this funding shortfall.
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
Source document signed by
Source document dated 2017-11-30
Source document signed by
Luc Casault, CPA, CGA
Chief Financial Officer
Source document dated 2017-11-29
Statement of authorities (unaudited)
|Total available for use for the year ending
March 31, 2018
|Expended during the quarter ended
September 30, 2017
|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|
|Total available for use for the year ending March 31, 2017||Expended during the quarter ended September 30, 2016||Year to date used at quarter-end|
|Vote 1 - Net operating expenditures||27,454||6,552||12,693|
|Statutory authorities - Employee Benefit Plans||3,521||881||1,761|
|Statutory authorities - Spending of proceeds from the disposal of surplus Crown assets||13||1||1|
|Statutory authorities - Expenditures Paragraph 29.1(1) of the Financial Administration Act||19||-||-|
|Budget 2016 Frozen allotment –
Back Office Transformation
|Total authorities available for use||30,975||7,434||14,455|
Statement of expenditures by standard object (unaudited)
|Expenditures:||Planned expenditures for the year ending March 31, 2018||Expended during the quarter ended September 30, 2017||Year to date used at quarter-end|
|Transportation and communications||1,630||326||560|
|Professional and special services||2,519||374||569|
|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|
|Total net budgetary expenditures||30,744||8,488||15,255|
|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|
|Transportation and communications||1,521||291||568|
|Professional and special services||2,362||439||688|
|Repair and maintenance||412||77||132|
|Utilities, materials and supplies||230||88||121|
|Acquisition of land, building and works||120||-||4|
|Acquisition of machinery and equipment||642||333||348|
|Sub-total net budgetary expenditures||31,007||7,434||14,455|
|Budget 2016 Frozen allotment –
Back Office Transformation
|Total net budgetary expenditures||30,975||7,434||14,455|
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