Quarterly Financial Report for the Quarter ended September 30, 2021

Statement of Authorities (unaudited)

Departmental budgetary expenditures by Standard Object (unaudited)

Statement outlining results, risks and significant changes in operations, personnel and program

1. Introduction

This quarterly financial report was prepared as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by Treasury Board. It should be read in conjunction with the 2021-2022 Main Estimates and the 2020-2021 Quarterly Financial Report for the quarter ended September 30, 2020. It has not been subject to an external audit or review.

A summary description of the Military Grievances External Review Committee (Committee) core responsibilities can be found in Part II of the Main Estimates.

Basis of Presentation

This quarterly financial report was prepared using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Committee's spending authorities granted by Parliament, and those used by the Committee consistent with the Main Estimates for the 2021-2022 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 Committee 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.

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

Statement of Authorities

There is an increase of $1.674 million in the authorities available for use in fiscal year 2021-2022. This variance is due to the timing in which appropriations bills receive royal assent. Unlike the current fiscal year, in 2020-2021, the Committee received its full fiscal year supply in the third quarter of the year.

In 2020-2021 and 2021-2022, the Committee's total authorities included the Operating Budget Carry-Forward from the previous year.

Statement of Departmental Budgetary Expenditures by Standard Object

During the second quarter of 2021-2022, expenses decreased by $6,999 compared to the second quarter of the previous year, while Year-to-Date (YTD) expenses increased by $198,940. Both variances are primarily due to an increase in personnel expenses as a result of the new collective agreement for the Program and Administrative Services (PA) group. The quarterly decrease in rent, offsetting the quarterly increase in personnel, is attributable to the period in which lease payments were settled.

3. Risks and Uncertainties

The Committee risks not being able to keep up with the unprecedented increase in the number of grievance files being referred by the Canadian Armed Forces (CAF). Despite the Committee projecting to deliver more than 300 Findings and Recommendations (F&R) reports this year, it has already received 270 file referrals from the CAF and is expecting to receive 70 more files this year. In addition, since inception in 2000, the Committee's funding has remained the same, yet the demand for our services continues to increase. To mitigate these risks, we will focus our efforts on two priorities.

Firstly, we must keep in mind that the terms of three Governor-in-Council (GIC) appointees will expire over the next planning period. This could have a significant impact on the Committee's ability to issue F&R reports in a timely manner, either if the renewals are not made prior to the expiry of the current terms or if the current Members are not reappointed. Given that the staffing process for GIC appointments requires preparation and planning, the President and CEO began early in the year to work closely with the various stakeholders involved in staffing a Member position. She specifically proposed staggering GIC appointment dates to ensure continuity of experienced Members. Secondly, it is essential we ensure staffing within Operations stabilizes at optimal levels. We must focus on attraction and retention, which remain a concern, especially for a micro-organization that is neither widely known across government nor can offer extensive professional development. We will continue to offer flexible work arrangements to our employees and make their well-being a priority. We will also implement modern staffing processes as well as hire from across Canada.

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

Justice Morris Fish's 3rd Independent Review of the National Defence Act was published in 2021. It was in the same year that the Canadian Armed Forces faced an internal crisis, specifically related to sexual misconduct. Justice Arbour was asked to investigate and issue a report with recommendations on next steps. Both reports have the potential of affecting the mandate and work of the Committee.

The Committee recently learned it will have to leave its current office space in 2026. This unexpected move has required a shift in priorities so that proper planning can begin in advance. This is occurring at the same time we are planning for a return to the workplace in 2022, COVID-19 protocols permitting. The Committee is seizing this as an opportunity to reduce its office footprint, to generate additional funds from a sub-let, and to fund additional staffing actions in the Operations Division, where staff is needed. The move also flagged the Committee's dependence on its server, which is managed entirely in-house. Senior management has decided to generate long-term cost savings by moving to the Cloud. This is a costly investment and will take several years. However, it does support the transition to a digital and agile organization with a mobile workforce.

Approved by:

Original signed by

_________________________________________
Christine Guérette, CPA, CGA
Chairperson and Chief Executive Officer
Notre-Dame-du-Laus, Canada
November 10, 2021

Original signed by

_________________________________________
Jean-François Poirier, CPA, CGA
Chief Financial Officer
Val-des-Monts, Canada
November 12, 2021