Canadian Heritage’s quarterly financial report for the quarter ended September 30, 2023

On this page

• 1. Introduction
  • 1.1. Authority, mandate and programs
  • 1.2. Basis of presentation
  • 1.3. Canadian Heritage financial structure
• 2. Highlights of fiscal quarter and fiscal year-to-date (YTD) results
  • 2.1. Statement of authorities
  • 2.2. Departmental budgetary expenditures by standard object
• 3. Risks and uncertainties
• 4. Significant changes in relation to operations, personnel and programs
• 5. Approval by senior officials
• Statement of authorities (unaudited)
• Departmental budgetary expenditures by standard object (unaudited)

Alternate format

Canadian Heritage’s quarterly financial report for the quarter ended September 30, 2023 [PDF version - 502 KB]

1. Introduction

This second quarterly financial report should be read in conjunction with the 2023-24 Main Estimates, the 2023-24 Supplementary Estimates A along with the 2022-23 Main Estimates and Supplementary Estimates A (nil for PCH). It has been prepared by management as required by section 65.1 - Quarterly financial reports of the Financial Administration Act and is in the form and manner prescribed by the Treasury Board in accordance with the special purpose financial reporting framework described in the Directive on Accounting Standards: GC 4400 Departmental Quarterly Financial Report. The report has been reviewed by the Departmental Audit Committee.

The quarterly financial report outlines the results, risks and significant changes in operations, personnel and programs and includes financial information tables for the quarter. The purpose of the quarterly financial information tables is to provide a comparison of the in-year departmental spending with authorities granted by Parliament, as well as comparative financial information for the preceding year.

1.1. Authority, mandate and programs

The Department of Canadian Heritage and its Portfolio organizations play a vital role in the cultural, civic, and economic life of Canadians. Our policies and programs promote an environment where Canadians can experience dynamic cultural expressions, celebrate our history and heritage, and build strong communities. The Department invests in the future by supporting the arts, our official and indigenous languages and our athletes and the sport system.

Further details on the Department of Canadian Heritage’s (PCH) authority, mandate and programs can be found in the 2023-24 Departmental Plan and the 2023-24 Main Estimates.

1.2. Basis of presentation

This second quarterly financial report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Department’s spending authorities granted by Parliament, and those used by the Department consistent with the Main Estimates and the Supplementary Estimates A for the 2023-24 fiscal year.

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.

PCH 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. Canadian Heritage financial structure

PCH has a financial structure composed of voted budgetary authorities that include Vote 1 – Operating expenditures and Vote 5 – Grants and Contributions, and Statutory authorities which are composed of contributions to employee benefits plans, Ministers’ Salary and motor car allowances and Statutory Payments for Lieutenant Governors.

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

2.1. Statement of authorities

Please refer to the Statement of Authorities at the end of the report for more information.

PCH’s 2023-24 authorities available for use at the end of September 2023 decreased by $211.9 million compared to last year, from $2,204.7 million in 2022-23 to $1,992.8 million at the end of this quarter. More specifically, the total authorities available for use decreased by $192.6 million in Vote 5 - Grants and Contributions, $18.9 million in Vote 1 - Operating expenditures and $0.4 million in Statutory authorities.

The overall net decrease in authorities is mainly explained by the sunsetting of various time-limited funding announced in the 2020 and 2021 Fall Economic Statements, in Budget 2021 and in Budget 2022, to promote recovery from the pandemic for Heritage, Arts and Sport sectors and to promote Official Languages.

2.2. Departmental budgetary expenditures by standard object

Please refer to the Departmental budgetary expenditures by Standard Object table at the end of report for more information.

The expenditures during the second quarter of 2023-24 decreased by $89.7 million compared to the same period last year. The decrease is mainly attributed to a reduction of $85.3 million in Vote 5 - Grants and Contributions (from $354.6 million in 2022-23 to $269.3 million in 2023-24), representing an overall decrease of 24% for this quarter.

The net decrease in transfer payments is mainly explained by the sunsetting of various time-limited funding announced in the 2020 and 2021 Fall Economic Statements, in Budget 2021 and in Budget 2022, to promote recovery from the pandemic for Heritage, Arts and Sport sectors. The programs affected the most are the Celebrations and Commemoration Program, the Indigenous Languages and Cultures Program, the Canada Arts Presentation Fund and the Museum Assistance Program.

The decrease is partially offset by a one-time payment during the second quarter of 2023-24 to the Jewish Community Centre of Greater Vancouver, which funding was announced in Budget 2022.

The remaining variance of $4.4 million is explained by a decrease in operating expenditures, more specifically, in the standard objects below:

• Personnel: $2.8 million decrease in expenditures due to the sunsetting of Budget 2021 temporary funding; and
• Professional and special services: $1.5 million decrease in expenditures due to one-time events in 2022-23 for the Royal Tour celebrating the commemorative initiatives to honour Her Majesty Queen Elizabeth II and the passing of Her Majesty Queen Elizabeth II.

As shown in the table below, PCH’s spending rate has remained stable year over year, having spent 17% of its authorities in the second quarter of 2023-24, compared to 19% in the second quarter of 2022-23.

Expenditures compared to annual authorities (in millions of dollars) - text version

-	2023-24	2022-23
Total available for use	1,993 (100%)	2,205 (100%)
Used during the quarter	333 (17%)	422 (19%)
Year-to-date used	687 (34%)	778 (35%)

3. Risks and uncertainties

As the arts, heritage, sports, and cultural sectors emerge from the COVID-19 pandemic, organizations funded through Canadian Heritage programs continue to face challenges related to the delivery of their activities.

The current year may see increased risks posed by global economic uncertainty, specifically inflation. Rapid inflation may put at risk events and projects due to significant cost increases. To mitigate the risks, PCH remains flexible in supporting organizations as they adapt so that they continue to offer events and activities during and beyond the recovery period.

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

During the second quarter of 2023-24, Véronique Côté joined the Department of Canadian Heritage as the new Chief Financial Officer starting August 28, 2023.

5. Approval by senior officials

Approved by:

Original signed
Isabelle Mondou, Deputy Minister

Gatineau, Canada
Date: November 24th, 2023

Original signed
Véronique Côté, Chief Financial Officer

Gatineau, Canada
Date: November 21st, 2023

Statement of authorities (unaudited)

Departmental budgetary expenditures by standard object (unaudited)

©His Majesty the King in Right of Canada, represented by the Minister of Canadian Heritage, 2023.
Catalogue No. CH2-4E-PDF
ISSN 2816-2730