Quarterly Financial Report

For the quarter ended September 30, 2019 (unaudited)

1. Introduction

This quarterly financial report should be read in conjunction with the Main Estimates and Supplementary Estimates for fiscal year 2019-20. It 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 Directive on Accounting Standards, GC 4400 Departmental Quarterly Financial Report. It has been reviewed by the Internal Audit Committee of the Public Service Commission of Canada.

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

1.1 Authority and objectives

The Public Service Commission (the agency) is an independent agency established under the Public Service Employment Act and listed in schedules I.1 and IV of the Financial Administration Act.

A summary description of the agency’s programs can be found in its 2019-20 Departmental Plan.

1.2 Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the 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 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.

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

1.3 Financial structure

The agency has a financial structure comprised of voted budgetary authorities for program expenditures and statutory authorities for contributions to employee benefit plans.

In addition, the agency has the authority to re-spend certain revenues received from other government departments and agencies in a fiscal year to offset expenditures incurred in that same year, for the provision of assessment and counselling products and services.

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

This section highlights the significant items that contributed to the change in resources available for the current year and in the actual expenditures for the quarter ended September 30, 2019.

The following graph provides a comparison of the net budgetary authorities available for spending and the expenditures for the quarters ended September 30, 2019, and September 30, 2018, for the agency’s combined Vote 1 – Program Expenditures and Statutory Authorities.

2.1 Significant changes to authorities

As shown in Section 6: Statement of Authorities, at September 30, 2019, there was an increase of $2,160,000 in authorities available for use in the current year, as compared to the previous year.

• The main variance is explained by an increase in funding received from the Treasury Board submission for Funding to support a healthy, diverse, inclusive and accessible public service.

2.2 Significant variances in expenditures from prior year

As shown in Section 7: Budgetary expenditures by standard object, total net budgetary expenditures during the quarter increased from $21,909,000 in 2018-19 to $24,294,000 in 2019-20; a variance of $2,385,000 or 10.9%.

The variance is due mainly to the following:

• an increase of $1,759,000 in personnel, mainly due to a salary cost increase of indeterminate employees and of payments to other government departments for transferred employees
• an increase of $931,000 in Professional and Special Services, mainly the result of these  factors:
• an increase of  $516,000 due to the fact that there were no payments for legal services made in the 2nd quarter of 2018-19, as Justice Canada waited until the signing of the new collective agreement for lawyers to bill the agency for legal services
• an increase of $224,000 in contract payments for management consultation services for the renewal of the Public Service Resourcing System and for information technology consultants
• an increase of $93,000 due to timing differences in the payment cycle of contributions to federal and other councils
• an increase of $66,000 in payments to outside parties for assessors and scoring services
• an increase of $339,000 in revenues netted against expenditures, due mainly to timing — billing in the system was much slower last year than this fiscal year; as well as a higher demand for assessment products and services.

3. Risks and uncertainties

The agency is evolving in a dynamic and complex environment that requires it to be effective, adaptive and innovative to support staffing in federal departments and agencies across Canada. As part of its departmental planning and reporting cycle, the agency undertakes an annual review of its organizational risks, as well as quarterly monitoring of mitigation strategies, activities and changes that are likely to have an impact on its expected results. This monitoring includes strategic oversight of the changes in external risk factors and internal vulnerabilities that may have an impact on the agency’s results.

The agency’s operational context, key risks as well as mitigation strategies can be found in its Departmental Plan 2019-20.

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

In September 2019, a new Commissioner was appointed to the agency for a 7-year term in replacement of her predecessor, whose term came to an end.

5. Approved by senior officials

Approved by:

Patrick Borbey
President

Philip Morton, CPA, CGA
Chief Financial Officer

Gatineau, Canada
November 8, 2019

6. Statement of Authorities (unaudited)

Fiscal year 2019–20 (in thousands of dollars)

	Total available for use for the year ending March 31, 2020*	Used during the quarter ended September 30, 2019	Year-to-date used at quarter-end
Vote 1 – Program Expenditures	80,320	19,515	37,755
Statutory – Refund of Previous Year Revenue	27	27	27
Statutory - Spending of proceeds from the disposal of surplus	1	1	1
Statutory – Employer Contributions to Employee Benefit Plans	11,545	4,751	4,751
Total Budgetary Authorities	91,893	24,294	42,534
* Includes only Authorities available for use and granted by Parliament at quarter-end.

Fiscal year 2018–19 (in thousands of dollars)

	Total available for use for the year ending March 31, 2019*	Used during the quarter ended September 30, 2018	Year-to-date used at quarter-end
Vote 1 – Program Expenditures	78,411	17,193	34,218
Statutory – Refund of Previous Year Revenue	6	1	6
Statutory – Employer Contributions to Employee Benefit Plans	11,316	4,715	4,715
Total Budgetary Authorities	89,733	21,909	38,939
* Includes only Authorities available for use and granted by Parliament at quarter-end.

7. Budgetary expenditures by standard object (unaudited)

Fiscal year 2019–20 (in thousands of dollars)

	Planned expenditures for the year ending March 31, 2020	Expended during the quarter ended September 30, 2019	Year-to-date used at quarter-end
Personnel	84,840	22,776	40,097
Transportation and telecommunications	904	104	251
Information	415	25	107
Professional and special services	15,440	2,247	3,157
Rentals	1,871	777	891
Repair and maintenance	675	15	22
Utilities, materials and supplies	170	49	133
Acquisition of machinery and equipment	1,632	42	103
Other subsidies and payments	198	459	795
Total gross budgetary expenditures	106,145	26,494	45,556
Less: Revenues netted against expenditures	(14,252)	(2,200)	(3,022)
Total net budgetary expenditures	91,893	24,294	42,534

Fiscal year 2018-19 (in thousands of dollars)

	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	85,760	21,017	37,194
Transportation and telecommunications	948	207	314
Information	265	58	89
Professional and special services	12,781	1,316	2,107
Rentals	1,680	617	742
Repair and maintenance	131	19	28
Utilities, materials and supplies	258	63	121
Acquisition of machinery and equipment	2,077	254	372
Other subsidies and payments	85	219	384
Total gross budgetary expenditures	103,985	23,770	41,351
Less: Revenues netted against expenditures	(14,252)	(1,861)	(2,412)
Total net budgetary expenditures	89,733	21,909	38,939