Quarterly financial report for the quarter ended December 31, 2022

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1. 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 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’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 Parks Canada’s Audit Committee.

1.1 Basis of presentation

This quarterly report has been prepared using an expenditure basis of accounting (modified cash accounting). The accompanying Statement of Authorities includes the Parks Canada’s spending authorities granted by Parliament and those used by the Agency consistent with the Main Estimates and Supplementary Estimates A and B for the 2022-23 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 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.

Parks Canada uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the department performance reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

 

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2. Highlights of fiscal quarter and fiscal year to date results

This section:

• highlights the financial results for the quarter and fiscal year-to-date ended December 31, 2022
• provides explanations of significant variances compared with the same period last year.

Budgetary Authorities and Expenditures for the third quarter of 2022-23 and 2021-22 ending December 31 — Text version

2022-23			2021-22
Authorities	Expenditures at quarter end	Year to date expenditures	Authorities	Expenditures at quarter-end	Year to date expenditures
1 309 532 000	252 402 000	719 626 907	1 531 929 011	257 178 579	750 527 579

2.1 Statement of authorities

Authorities available for use

This quarterly report reflects the funding available for use from the 2022-23 Main Estimates, the 2022-23 Supplementary Estimates A and B, and the 2021-22 unused spending authority. The authorities at the same time last year consisted of 2021-22 Main Estimates, the 2021-22 Supplementary Estimates A and B, and the 2020-21 unused spending authority ^Footnote1.

At December 31, 2022, Parks Canada’s total authorities available for use for the year ending March 31, 2023, are $222.4 million or 15% lower when compared to the same quarter of the previous year (from $1,531.9 million to $1,309.5 million). This decrease in authorities is primarily due to the following factors:

• A net decrease of $217.5 million in spending authorities related to time-limited funding for infrastructure investments;
• A decrease of $71.7 million in spending authorities, which was an approved up-to amount, to partially cover pandemic related revenue shortfalls over the first six months of 2021-22. In the end, revenue shortfalls, net of savings generated, were immaterial and this funding was not accessed by Parks Canada;
• A decrease of $37.9 million in spending authorities related to the Youth Employment and Skills Strategy (YESS).

These decreases are offset by the following increases:

• An increase of $48.8 million in spending authorities related to the Enhanced Nature Legacy initiative to conserve Canada’s lands and freshwater, protect species, advance Indigenous reconciliation and increase access to nature;
• An increase of $44.1 million relating to several initiatives such as funding to implement Canada’s new marine conservation targets, funding to implement the Wood Buffalo National Park World Heritage Site Action Plan, funding for wildfire and flood resilience, and funding for the archaeology and conservation as well as the implementation of the Inuit and Impact Benefit Agreement of the Wrecks of HMS Erebus and HMS Terror National Historic Site.

Authorities used during the quarter

In the third quarter of 2022-23, total net budgetary expenditures were $252.4 million compared to $257.2 million reported for the same period in 2021-22, resulting in a decrease of $4.8 million or 2 percent. The decrease in authorities used during the quarter is primarily related to reduced infrastructure investments.

Table 1 provides information on the authorities available for use and used during this quarter.

2.2 Budgetary expenditures by standard object

Planned by standard object

Total planned expenditures, for the year ending March 31, 2023, are $222.4 million (or 15%) lower compared to the previous year. The decreases are mainly observed in Acquisition of lands, buildings and works, transportation and communications and professional services planned expenditures, due to reduced infrastructure investment funding.

These decreases are partially offset by increases in Transfer payments planned expenditures, largely due to additional grants and contributions funding received for the Enhanced Nature Legacy initiative.

 

Expended by standard object

As per Table 2 — Budgetary expenditures by standard object, the total expended in the third quarter ending December 31, 2022, is $4.8 million (or 2 percent) lower compared to the previous year. This variance is primarily attributed to a decrease in Acquisition of land, buildings and works expenditures related to reduced infrastructure investment funding.

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3. Risks and uncertainties

Parks Canada undertakes a corporate risk assessment every year to support programs, priority setting and resource allocation. The risk assessment identifies key corporate risks that have the greatest impact on the organisation’s ability to deliver its Core Responsibility and achieve Departmental Results. Parks Canada has identified the following key corporate risks for 2022-23:

Environmental forces adaptation and response

Due to the magnitude and rapid pace of environmental changes, including climate change, there is a risk that the integrity of ecosystems, cultural resources and infrastructure cannot be maintained or improved which may lead to Parks Canada being unable to deliver its mandate.

Relationships with Indigenous people

If Parks Canada does not allocate the necessary time, effort and investment to build and maintain relationships with Indigenous peoples, there is a risk that the Agency may not be able to fulfill its obligations and deliver on its programs and services, which may result in damaged reputation, increased litigation and challenges meeting conservation targets.

Built asset condition and long-term sustainability

Due to aging infrastructure, inadequate level of recapitalization and maintenance, climate change and inflationary impacts, there is a risk that Parks Canada will not be able to maintain a sustainable asset portfolio which may result in compromised public safety, loss of irreplaceable cultural heritage, and damage to the Agency’s reputation.

Competitive position

If Parks Canada does not respond to changing socio-economic conditions and other market influences, there is a risk that Parks Canada’s programs and services may not meet the expectations of Canadians which may lead to a decrease in Agency relevance as measured by a decrease in tourism market share and visitation.

Business innovation

If Parks Canada does not modernize its corporate and internal services, there is a risk that the organisation may not have the capacity, business processes and tools to effectively and efficiently support service delivery and meet government management accountability expectations.

Workforce, equity, accessibility, inclusion and diversity, and well-being

If Parks Canada fails to foster an inclusive and barrier-free work environment that reflects Canada’s diverse population, there is a risk that it may no longer be an employer of choice and will lack the perspective needed to serve all Canadians, which may result in impacts on programs and services, and damage the Parks Canada’s reputation.

COVID-19 pandemic

Public health restrictions continue to ease across the country. Parks Canada’s priority remains the health and safety of its employees, visitors and all Canadians. Parks Canada continues to monitor the situation with a view to being ready, as appropriate, to adjust operations in accordance with public health guidance.

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4. Significant changes in relation to operations, personnel and programs

There are no significant changes in relation to operations, personnel and programs to report during this quarter.

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5. Approval by senior officials

Approved by:

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Statement of Authorities - Table 1

Parks Canada
For the quarter ended December 31, 2022
Statement of Authorities - Table 1
(Unaudited)

 

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Budgetary Expenditures by Standard Object - Table 2

Parks Canada
For the quarter ended December 31, 2022
Budgetary Expenditures by Standard Object - Table 2
(Unaudited)