Quarterly Financial Report for the quarter ended June 30, 2018 - Secretariat of the National Security and Intelligence Committee of Parliamentarians

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Introduction

This Quarterly Financial 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 Directive on Accounting Standards, GC 4400 Departmental Quarterly Financial Report. This Quarterly Financial Report should be read in conjunction with the 2018-19 Main Estimates. This quarterly report has not been subject to an external audit or review.

Mandate

The National Security and Intelligence Committee of Parliamentarians Act received Royal Assent on June 22, 2017.  It formally establishes the Secretariat of the National Security and Intelligence Committee of Parliamentarians (the Secretariat).  The Secretariat assists the National Security and Intelligence Committee of Parliamentarians in fulfilling its mandate, which is to review:

  • The legislative, regulatory, policy, administrative and financial framework for national security and intelligence;
  • Any activity carried out by a department that relates to national security or intelligence, unless the activity is an ongoing operation and the appropriate Minister determines that the review would be injurious to national security; and
  • Any matter relating to national security or intelligence that a minister of the Crown refers to the Committee.

The Secretariat ensures the Committee receives timely access to relevant, classified information and strategic and expert advice in the exercise of Committee reviews.  It assists in the development of Committee reports and provides support to ensure compliance with security requirements.

As the Secretariat was created in 2017-18, no Program Alignment Architecture existed for reporting purposes. A Departmental Results Framework and accompanying Program Inventory is under development, to be completed by the 2019-20 fiscal year.

Basis of Presentation

This quarterly 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 Supplementary Estimates (as applicable) for the 2018-2019 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 moneys 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 Secretariat 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.

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

Given that this is the first full year of existence of the Secretariat, no trend comparisons are available for actual expenditures nor for planned expenditures when compared to the same period in the preceding fiscal year.  The Secretariat’s financial processes will be refined as the fiscal year progresses.

Please note that for the period ending June 30, 2018, the authorities provided to the Secretariat included the Main Estimates.  

Employee Benefit Plans represent the most significant financial expenditure for the Secretariat in the first quarter of 2018-19. Significant financial commitments planned for the remainder of the fiscal year include:

  • One-time costs associated with renovating an existing government facility to permanently house the Committee and Secretariat.
  • One-time costs associated with the acquisition and installation of information technology infrastructure and hardware.
  • One-time costs associated with the provision of security services to supervise the renovation of the permanent facility.
  • Ongoing costs associated with the recruitment and compensation of employees.

Risks and Uncertainties

Given that the Secretariat is in its first year of operations, there are some risks and uncertainties associated with the expenditures to construct the Secretariat and Committee’s permanent facility. Costs include renovation and construction, security, and information technology infrastructure. Both the Secretariat and PCO are actively monitoring project costs and timelines. The Secretariat expects to move to the permanent facility in September 2018.

After the Secretariat has implemented these one-time construction expenditures, the funding profile will stabilize.  Notable ongoing expenditures will include employee compensation plans and costs associated with the day-to-day support of the Committee. The Secretariat will finalize staffing and recruitment initiatives in 2018-19 and will have a full complement of ten full-time employees.

The Secretariat has signed agreements with other federal organizations to receive dedicated corporate support and security. The Privy Council Office provides corporate support to the Secretariat, which includes security, information technology and human resources.   

Further assessments of key risks, their likelihood and the implications for the organization will be conducted later this fiscal year.

Significant changes in relation to operations, personnel and programs

As this is the first year of operation of the Secretariat, there are no changes to report in relation to Operation, Personnel and Programs. The Secretariat has established its organizational and governance structure to support the delivery of its mandate.

Approval by Senior Officials

Rennie Marcoux, Executive Director
Ottawa, Ontario
August 29, 2018

Sean Jorgensen, Director of Operations and Chief Financial Officer
Ottawa, Ontario
August 29, 2018

Annex A 

Statement of authorities (unaudited) (note 2)

(In dollars)
  Fiscal year 2018-2019
  Total available for use for the year ending March 31, 2019 (note 1)

Used during the quarter ended
June 30, 2018

Year-to-date
used at
quarter-end
Vote 1 - Net operating expenditures

 3,294,747  18,792  18,792
Budgetary statutory authorities 
 
Contributions to employee benefits plans
 199,081  49,770 49,770
Spending of proceeds from the disposal of surplus Crown assets  - 
Total budgetary authorities 3,493,828 68,562 68,562
Total Authorities 3,493,828 68,562 68,562
Note 1: Includes only Authorities available for use and granted by Parliament at quarter-end for each respective fiscal year.
Note 2: Details may not add to totals due to rounding

Annex B 

Departmental budgetary expenditures by Standard Object (unaudited) (note 2)

(In dollars)
  Fiscal year 2018-2019

 

Planned expenditures for the year ending March 31, 2019 (note 1)

Expended
during the
quarter ended
June 30, 2018

Year-to-date
used at
quarter-end

Budgetary expenditures

 

Personnel

1,673,026

58,920

58,920

Transportation and communications

327,040

4,462

4,462

Information

55,500

-  

-  

Professional and special services

1,226,803

5,179

5,179

Rentals

86,705

-  

-  

Repair and maintenance

-  

-  

-  

Utilities, materials and supplies

15,200

-  

-  

Acquisition of machinery and equipment

109,554

-  

-  

Transfer payments

-  

-  

-  

Public debt charges

-  

-  

-  

Other subsidies and payments

-  

-  

-  

Total gross budgetary expenditures

3,493,828

68,562

68,562

Less revenues netted against expenditures

 

Revenues

-  

-  

Total revenues netted against expenditures

-  

-  

Total Budgetary Expenditures

3,493,828

68,562

68,562

Note 1: Includes only Authorities available for use and granted by Parliament at quarter-end for each respective fiscal year.

Note 2: Details may not add to totals due to rounding

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