Canadian Environmental Assessment Agency’s Quarterly Financial Report for Quarter ended June 30, 2019
Statement outlining results, risks and significant changes in operations, personnel and programs
Introduction
The Canadian Environmental Assessment Agency’s (the Agency) first quarterly financial statement report for the period ended June 30, 2019 has been prepared by management as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by Treasury Board under the Directive on Accounting Standards. It should be read in conjunction with the Main Estimates and Supplementary Estimates for the current year.
This report has not been subject to an external audit or review.
The Agency is the responsible authority for all projects subject to the Canadian Environmental Assessment Act, 2012 (CEAA 2012) except for those that are regulated by the National Energy Board or the Canadian Nuclear Safety Commission. In accordance with the transitional provisions of CEAA 2012, the Agency is also responsible for managing the environmental assessment (EA) of most projects that are required to be completed under the former Canadian Environmental Assessment Act.
In addition, the Agency advises and assists the Minister of Environment and Climate Change in establishing review panels and supports panels in their work. It also supports the Minister in fulfilling responsibilities under CEAA 2012, including the development and issuance of enforceable EA decision statements.
The Agency administers a Participant Funding Program that supports individuals, not-for-profit organizations, and Indigenous groups participating in federal EAs.
The Agency also has responsibilities for reviewing projects of a federal nature under the environmental and social protection regimes set out in sections 22 and 23 of the 1975 James Bay and Northern Quebec Agreement. The President of the Agency is designated by Order-in-Council as the federal administrator of these processes.
The Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals establishes a self-assessment process for conducting a strategic EA of a policy, plan or program proposal. The Agency supports the Minister of Environment and Climate Change in promoting the application of the Cabinet Directive and provides training and guidance for federal authorities.
The Agency's activities are carried out under two core responsibilities: Environmental Assessments and Internal Services.
The Agency provides high-quality assessments of environmental effects to support government decision making. Environmental assessments ensure that adverse environmental effects are considered in a precautionary manner to maintain a healthy environment and to promote sustainable development.
Internal Services are those groups of related activities and resources that the federal government considers to be services in support of Programs and/or required to meet corporate obligations of an organization. Internal Services are:
- Management and Oversight Services
- Communications Services
- Legal Services
- Human Resources Management Services
- Financial Management Services
- Information Management and Technology Services
- Real Property Management Services
- Material Management Services
- Acquisition Management Services
The Agency was established in 1994 and is led by a President, who reports directly to the Minister of Environment and Climate Change. It has its headquarters in Ottawa and regional offices in St. John’s, Halifax, Quebec City, Toronto, Edmonton, and Vancouver.
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 and Supplementary Estimates (as applicable) for the 2019-2020 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.
When Parliament is dissolved for the purposes of a general election, section 30 of the Financial Administration Act authorizes the Governor General, under certain conditions, to issue a special warrant authorizing the Government to withdraw funds from the Consolidated Revenue Fund. A special warrant is deemed to be an appropriation for the fiscal year in which it is issued.
The Agency uses the full accrual method of accounting to prepare and present its annual 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 fiscal quarter and fiscal year-to-date (YTD) results
Figure 1 outlines the net budgetary authorities ($74,175,013 in 2019-2020 and $33,629,775 in 2018-2019), which represent the resources available for the year as at June 30, 2019 net of the revenue that is forecasted to be collected. Within those resources, a separate budgetary vote for Grants and Contributions was established in 2019-2020 to include new Grants and Contributions funding received to support the implementation of the Impact Assessment Agency of Canada. The Agency’s available authorities, net of revenues, increased by $40.55M from the previous year to support the implementation of the Impact Assessment Agency of Canada.
Figure 1 also outlines the Agency’s first quarter year-to-date budgetary expenditures net of revenues that have increased by $2.26M from the previous year ($10,910,813 in 2019-2020 and $8,650,959 in 2018-2019).
- An increase in personnel costs of $1.92M to support preparations for the implementation of the Impact Assessment Agency of Canada.
- An increase in professional services costs of $418K for preparations for the implementation of the Impact Assessment Agency of Canada.
- A reduction of $372K in transfer payments in comparison to the same period last year with an increase expected for Q2.
- All other expenditures net of revenues represent an increase of $290K over Q1 of 2018-2019.
Risks and Uncertainties
The Agency’s expenditures and revenues are influenced by the number of EAs underway during any given fiscal year and with the number of EAs influenced by economic conditions outside the control of the Agency. To off-set portions of its expenditures, the Agency has vote-netted authority to recover certain costs from proponents in the conduct of EAs by review panels. The timing of revenue collection is uncertain and may impact the Agency’s overall financial results.
In addition, the timing of requests for participant funding for consultation varies and is unpredictable. A commitment to participant funding may be planned in one year but could be realized across multiple fiscal years depending on the progression of the environmental assessment. Unused commitments are carried forward from one year to another and are honoured by the Agency as they become due.
The Agency is also subject to litigation, the extent and costs are uncertain and are normally covered by the Agency’s annual appropriations.
Significant Changes in Relation to Operations, Personnel and Programs
The Government of Canada passed legislation in June 2019 to establish the Impact Assessment Agency of Canada, which will complete EAs underway and the Agency will transition from conducting EAs to Impact Assessments.
Approval by Senior Officials
Approved by:
Ron Hallman
President
Alan Kerr, CPA, CMA
Vice-President, Corporate Services and Chief Financial Officer
Ottawa, Canada
August 27, 2019
Statement of Authorities (unaudited)
| Total available for use the year ending March 31, 2020 |
Used during the quarter ended June 30, 2019 |
Year to date used at quarter-end | |
|---|---|---|---|
| VOTE 1 - Net Operating Expenditures | $ 53,511,120 | $ 8,938,034 | $ 8,938,034 |
| VOTE 5 - Grants and Contributions | $ 14,525,184 | $ 438,102 | $ 438,102 |
| Statutory Authorities - Employee Benefits | $ 6,138,709 | $ 1,534,677 | $ 1,534,677 |
| Total Authorities | $ 74,175,013 | $ 10,910,813 | $ 10,910,813 |
| Total available for use for the year ending March 31, 2019 |
Used during the quarter ended June 30, 2018 |
Year to date used at quarter-end |
|
|---|---|---|---|
| VOTE 1 - Net Operating Expenditures | $ 30,232,320 | $ 7,787,857 | $ 7,787,857 |
| Statutory Authorities - Employee Benefits | $ 3,397,455 | $ 863,102 | $ 863,102 |
| Total Authorities | $ 33,629,775 | $ 8,650,959 | $ 8,650,959 |
Agency Budgetary Expenditures by Standard Object (unaudited)
| Planned Expenditures for the year ending March 31, 2020 |
Expended during the quarter ended June 30, 2019 |
Year to date used at quarter-end | |
|---|---|---|---|
| Expenditures | |||
| Personnel | $ 46,260,992 | $ 9,257,047 | $ 9,257,047 |
| Transportation and Telecommunications | $ 1,967,865 | $ 359,266 | $ 359,266 |
| Information | $ 391,434 | $ 119,161 | $ 119,161 |
| Professional Services | $ 6,864,485 | $ 824,719 | $ 824,719 |
| Rentals | $ 4,962,442 | $ 57,223 | $ 57,223 |
| Purchased Repair and Maintenance | $ 8,556 | $ 90 | $ 90 |
| Utilities, materials and supplies | $ 213,898 | $ 28,694 | $ 28,694 |
| Acquisition of Machinery & Equipment | $ 1,306,919 | $ 68,116 | $ 68,116 |
| Transfer Payments | $ 14,525,184 | $ 438,102 | $ 438,102 |
| Other expenses | $ 973,238 | $ 14 | $ 14 |
| Total Gross Budgetary Expenditures | $ 77,475,013 | $ 11,152,432 | $ 11,152,432 |
| Less Revenues netted against Expenditures | |||
| Planned Revenues (Note 1) | |||
| Environmental assessment and training services | -$ 3,300,000 | -$ 241,619 | -$ 241,619 |
| Total Revenue netted against expenditures | -$ 3,300,000 | -$ 241,619 | -$ 241,619 |
| Total net budgetary expenditures | $ 74,175,013 | $ 10,910,813 | $ 10,910,813 |
| Planned Expenditures for the year ending March 31, 2019 |
Expended during the quarter ended June 30, 2018 |
Year to date used at quarter-end | |
|---|---|---|---|
| Expenditures | |||
| Personnel | $ 25,749,131 | $ 7,332,330 | $ 7,332,330 |
| Transportation and Telecommunications | $ 1,027,331 | $ 200,856 | $ 200,856 |
| Information | $ 204,350 | $ 44,931 | $ 44,931 |
| Professional Services | $ 2,036,805 | $ 407,136 | $ 407,136 |
| Rentals | $ 2,590,661 | $ 54,515 | $ 54,515 |
| Purchased Repair and Maintenance | $ 4,467 | $ 256 | $ 256 |
| Utilities, materials and supplies | $ 111,666 | $ 16,693 | $ 16,693 |
| Acquisition of Machinery & Equipment | $ 682,282 | $ 18,092 | $ 18,092 |
| Transfer Payments | $ 4,715,000 | $ 810,546 | $ 810,546 |
| Other expenses | $ 508,082 | $ 1,068 | $ 1,068 |
| Total Gross Budgetary Expenditures | $ 37,629,775 | $ 8,886,423 | $ 8,886,423 |
| Less Revenues netted against Expenditures | |||
| Planned Revenues (Note 1) | |||
| Environmental assessment and training services | -$ 4,000,000 | -$ 235,464 | -$ 235,464 |
| Total Revenue netted against expenditures | -$ 4,000,000 | -$ 235,464 | -$ 235,464 |
| Total net budgetary expenditures | $ 33,629,775 | $ 8,650,959 | $ 8,650,959 |
Note 1: The Agency has authority to collect up to $8,001,000 in vote-netted revenue
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