Quarterly financial report for the quarter ended September 30, 2019
This quarterly report has been prepared by management as required by section 65.1 of the Financial Administration Act and in the manner prescribed by the Treasury Board. The report should be read in conjunction with the Main Estimates, the Supplementary Estimates and the previous Quarterly Financial Reports.
A summary description of the Parks Canada Agency’s programs can be found in Part II of the Main Estimates, and a detailed description in Part III – Departmental Plans.
This quarterly report has not been subject to an external audit. However, it has been reviewed by the Agency’s Audit Committee.
1.1 Basis of presentation
This report has been prepared using an expenditure basis of accounting (modified cash accounting). The accompanying Statement of Authorities includes the Parks Canada Agency’s spending authorities granted by Parliament and those used by the Agency consistent with the Main Estimates for the 2019-20 fiscal year. This 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 money 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 Agency uses the full accrual method of accounting to prepare and present its annual departmental financial statements, which are part of the departmental results 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
2.1 Statement of authorities (Table 1)
Authorities available for use
This quarterly report reflects the funding available for use from the 2019-20 Main Estimates, authorities received via allocation from Treasury Board Vote 5 - Government Contingencies, and the 2018-19 unused spending authorityFootnote 1 . The authorities at the same time last year consisted of 2018-19 Main Estimates, authorities for Budget 2018 measures and the 2017-18 unused spending authority.
As per Table 1 (Statement of authorities), at September 30, 2019, Parks Canada’s total authorities available for use for the year ending March 31, 2020, are $298.3 million or 16 percent higher when compared to the same quarter of the previous year (from $1,858.0M to $2,156.3M). The increase in authorities is primarily due to the following factors:
- An increase in spending authorities related to infrastructure investments -$128.1 million;
- An increase in unused spending authorities in 2018-2019 - $135 million;
- An increase in spending authorities to implement A Nature Legacy for Canada - $14.8 million;
- An increase in spending authorities as a result of last year’s ratification of the collective agreement signed in May 2018 -$11.3 million.
Note: Parks Canada has requested to reprofile $502.6 million from 2019-20 into 2020-21 and 2021-22 in order to align the remaining authorities with the multi-year forecasts.
Authorities used during the quarter
In the second quarter of 2019-20, total net budgetary expenditures were $403.0 million compared to $419.6 million reported for the same period in 2018-19, resulting in a decrease of $16.6 million or 4 percent.
The decrease in authorities used during the quarter is primarily due to retroactive payments following the ratification of the collective agreement in 2018-19 as well as a decrease in fire management costs compared to 2018-19.
These decreases were partially offset by an increase in expenditures related to the Agency’s infrastructure investment program.
2.2 Budgetary expenditures by standard object (Table 2)
Planned by standard object
Total planned expenditures in the second quarter of 2019-20 are $298.3 million or 16 percent higher compared to the previous year. This variance is primarily due to the ramp up of authorities in the Agency’s infrastructure investment program, an increase in authorities from unused spending authorities from the previous fiscal year, an increase in spending authorities to implement A Nature Legacy for Canada and an increase in spending authorities as a result of last year’s ratification of the collective agreement.
Expended by standard object
As per Table 2 (Budgetary expenditures by standard object), the total expended in the second quarter ending September 30, 2019, is $16.6 million or 4 percent lower compared to the previous year. The overall decrease can be explained by the following:
- Personnel expenditures have decreased by $32.3 million compared to the same quarter last year. This decrease is primarily due to the retroactive payments following the ratification of the collective agreement in 2018-19.
- Compared to the same quarter last year, rental expenditures, such as aircraft rentals, decreased by $4.5 million. This decrease is primarily due to a reduction in fire management costs following important wildfires in 2018-19.
- These decreases were partially offset by an increase of $29.9 million in the acquisition of land, buildings and works expenditures primarily due to the increase in expenditures of the Agency’s infrastructure investments program.
Note: Parks Canada’s complex asset portfolio is comprised of a significant number of heritage assets as well as the rural and remote locations where our projects are delivered, both factors which can increase the uncertainty in project delivery that may lead to unexpected changes to project scope and corresponding cost and schedule.
3. Risks and uncertainties
Parks Canada's objectives and core responsibility are influenced by various internal and external factors. The Agency undertakes a risk assessment every year to support decision making related to priority setting and resource allocation. The risk assessment identifies key risks that have the greatest impact on the Agency's ability to achieve its core responsibility and departmental results. The Agency has identified the following key corporate risks for 2019-20:
Environmental forces adaptation and response:
The magnitude and rapid pace of environmental changes, including climate change, may affect Parks Canada's ability to maintain the integrity of its ecosystems, cultural resources and infrastructure.
Reconciliation with Indigenous peoples:
There is a risk that Parks Canada’s actions may not fulfill obligations to Indigenous peoples and that Canadians may not support or understand Parks Canada’s reconciliation actions.
There is a risk that Parks Canada will not establish the partnerships required to achieve Agency results.
Relevance and public support:
There is a risk that Parks Canada’s programs and services may not meet the expectations of Canadians.
Built asset condition and long-term sustainability:
There is a risk that a sustainable asset portfolio will not be maintained to support the delivery of Parks Canada's mandate.
4. Significant changes in relation to operations, personnel and programs
Ron Hallman was appointed as President & Chief Executive Officer of the Agency on August 28, 2019. This role was filled on an interim basis by Michael Nadler.
Catherine Blanchard was appointed Chief Financial Officer effective October 7, 2019. The role was filled on an interim basis by Ghislaine Lalonde.
Trevor Swerdfager, Senior Vice-President, Operations Directorate, has left the Parks Canada Agency during the month of September 2019. Michael Nadler has been occupying the position on an interim basis since then.
5. Approval by senior officials
President & Chief Executive Officer,
November 27, 2019
Chief Financial Officer,
November 25, 2019
Parks Canada Agency
For the quarter ended September 30, 2019
Statement of authorities - Table 1
|(in thousands of dollars)||Total available for use for the year ending March 31, 2020Footnote *||Used during the quarter ended September 30, 2019||Year to date used at quarter end|
|Vote 1 - Program expenditures||1,914,398||328,281||495,388|
|Vote 5 - Payments to the New parks and historic sites account||13,423||0||0|
|Statutory - Contributions to employee benefit plans||53,221||13,305||26,610|
|Statutory - Expenditures equivalent to revenues resulting from the conduct of operations pursuant to section 20 of the Parks Canada Agency Act||175,210||61,443||97,337|
|Total budgetary authorities||2,156,252||403,029||619,335|
|(in thousands of dollars)||Total available for use for the year ending March 31, 2019Footnote *||Used during the quarter ended September 30, 2018||Year to date used at quarter end|
|Vote 1 - Program expenditures||1,638,182||346,821||504,806|
|Vote 5 - Payments to the New parks and historic sites account||9,007||0||0|
|Statutory - Contributions to employee benefit plans||49,257||11,946||23,891|
|Statutory - Expenditures equivalent to revenues resulting from the conduct of operations pursuant to section 20 of the Parks Canada Agency Act||161,590||60,793||94,784|
|Total budgetary authorities||1,858,036||419,560||623,481|
Parks Canada Agency
For the quarter ended September 30, 2019
Budgetary expenditures by standard object - Table 2
|(in thousands of dollars)||Planned expenditures for the year ending March 31, 2020Footnote *||Expended during the quarter ended September 30, 2019||Year to date used at quarter end|
|Transportation and communications||53,990||5,845||10,394|
|Professional and special services||478,309||45,058||64,005|
|Repair and maintenance||73,913||6,089||10,297|
|Utilities, materials and supplies||113,102||14,899||22,807|
|Acquisition of land, buildings and works||852,127||160,960||215,239|
|Acquisition of machinery and equipment||52,410||7,718||10,931|
|Public debt charges||0||38||59|
|Other subsidies and payments||32,740||13,255||14,766|
|Total budgetary expenditures||2,156,252||403,029||619,335|
|(in thousands of dollars)||Planned expenditures for the year ending March 31, 2019Footnote *||Expended during the quarter ended September 30, 2018||Year to date used at quarter end|
|Transportation and communications||37,978||5,526||10,335|
|Professional and special services||406,395||54,876||75,778|
|Repair and maintenance||53,817||10,386||14,440|
|Utilities, materials and supplies||85,770||15,479||23,035|
|Acquisition of land, buildings and works||751,544||131,091||177,027|
|Acquisition of machinery and equipment||42,709||4,741||7,907|
|Public debt charges||0||36||48|
|Other subsidies and payments||20,186||11,121||14,878|
|Total budgetary expenditures||1,858,036||419,560||623,481|
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