Quarterly financial report for the quarter ended June 30, 2020

Official title: Statement outlining results, risks and significant changes in operations, personnel and programs for the quarter ended June 30, 2020

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Introduction

This Quarterly Financial Report (QFR) is prepared by management as required by section 65.1 of the Financial Administration Act. It reads in conjunction with the 2020 to 2021 Main Estimates.

Authority, mandate and programs

When the Accessible Canada Act became law in July 2019, it created the Canadian Accessibility Standards Development Organization. In January 2020, the organization adopted the title Accessibility Standards Canada because it is easier to remember and also follows Treasury Board requirements. The legal title of the organization is still the Canadian Accessibility Standards Development Organization, as per the Accessible Canada Act.

Accessibility Standards Canada will help to achieve a Canada without barriers, on or before January 1, 2040. It will do this by:

  • developing new, and changing existing, accessibility standards
  • supporting innovative research
  • sharing information about identifying, removing and preventing accessibility barriers

The December 2019 Mandate Letter to the Minister of Employment, Workforce Development and Disability Inclusion from the Prime Minister highlighted the importance of Accessibility Standards Canada’s work. The letter asked the Minister to:

  • continue her efforts in leading the Government’s work to promote disability inclusion
  • support the operationalization of Accessibility Standards Canada, in consultation with the disability community

Accessibility Standards Canada’s priorities for the 2020 to 2021 year are in line with the directives in the Mandate Letter:

  • Accessibility Standards Canada will focus on hiring new people, particularly persons with disabilities
  • the organization will continue to build organizational capacity

The Board will work with persons with disabilities and partners across the country to guide the work.

Further information on Accessibility Standards Canada’s mandate and program activities are found in Part II of the Main Estimates and in the Departmental Plan.

Basis of presentation

This quarterly report was prepared by management using:

  • an expenditure basis of accounting
  • a special-purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities

The accompanying Statement of authorities (Table 1) includes Accessibility Standards Canada’s spending authorities granted by Parliament. It is consistent with the Main Estimates and the budgetary authorities used by the Department for the 2019 to 2020 fiscal year.

Parliament must approve spendings by the Government. Approvals are provided annually in allocated limits through appropriation acts or through legislation.

As part of the departmental performance reporting process, Accessibility Standards Canada prepares its annual financial statements on a full accrual basis. It follows Treasury Board accounting policies, which are based on Canadian accounting principles for the public sector. However, the spending authorities voted by Parliament remain on an expenditure basis.

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

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

This section highlights the significant items that contributed to:

  • the net increase in resources available for the year
  • the net increase in actual expenditures for the quarter ending June 30, 2019

Since Accessibility Standards Canada received its funding in the third quarter of 2019 to 2020, no budgetary authorities or spending occurred in the first quarter of the 2019 to 2020 fiscal year.

Significant changes to budgetary authorities

As of June 30, 2020, Accessibility Standards Canada’s total available authorities for fiscal year 2020 to 2021 amounted to $11.7 million. This is a 100% increase from the same period of the previous year. Additional funding is expected in the third quarter, pending Parliamentary approval.

Significant changes to authorities used

As of June 30, 2020, Accessibility Standards Canada spent $212,000. As previously stated, there are no expenditures for the comparable period of the previous year.

Total authorities used during the first quarter of fiscal year 2020 to 2021 ($212,000) represent 2% of total available authorities ($11.7 million). This is lower than the 25% normally expected (quarter of the year completed). While the increase in operations during the ramp-up period was experienced as expected, it is the payment process to other government departments that incurred most of the delays in cash expenditures. Priority is put on external vendors.

The main component for delays in payments is staff salaries. As a new corporation, Accessibility Standards Canada has several agreements with Employment and Social Development Canada (ESDC). One of these is to support the compensation of its employees through Phoenix. This is because an entity within the system has yet to be created for the organization. As the employees are currently paid by ESDC, a quarterly process is in place to invoice Accessibility Standards Canada for reimbursement of staff expenditures. Payment to ESDC was completed in the second quarter and will be presented in the next iteration of this report.

Risks and uncertainties

To ensure that corporate objectives are met, key risks were highlighted in the organization’s first Departmental Plan. In addition to these risks, an Enterprise-wide Risk Management Framework is expected soon to better highlight the risks that the organization faces, and how to mitigate them. The organization is also working on including COVID-19 risks. How the pandemic will shape its present and future remains to be seen.

The primary financial risk is the ramp-up of operations. With all new organizations come a steep learning curve. This uncertainty manifests itself when defining the optimal workforce and financial requirements to achieve its mandate. The agility required from senior management and its Board of Directors is a key mitigation factor that allows Accessibility Standards Canada to build its operations. Decisions are done in a timely manner which has made the organization run efficiently and minimize the impact COVID-19 could have had on the ramp-up of its operations.

Significant changes related to operations, personnel and programs

Accessibility Standards Canada’s establishment in December 2019 has created unique challenges, including:

  • how to establish an optimal workforce
  • how to operationally meet its mandate

Integrated and multi-year planning has created a baseline for what the organizations operations will look like in the future. At this time, the only temporary pressure that faces the organization is the relocation of its workspace.

Originally planned for the 2021 to 2022 fiscal year, this relocation was deemed a priority by the Government and moved to fiscal year 2020 to 2021. Accessibility Standards Canada is currently working with Central Agencies (Treasury Board Secretariat and Department of Finance) to mitigate this pressure with mechanisms already in place to address these. The expectation is that this pressure will be resolved by the third quarter of this fiscal year.

Approval by senior officials

Approved by:

  • Philipe Sarrazin, CPA-CGA, Senior Director and Chief Financial Officer, on August 28, 2020
  • Philip Rizcallah, Chief Executive Officer, on August 28, 2020

Table 1: Statement of authorities (unaudited)

Table 1: Statement of Authorities
Expenditures by vote (in thousands of dollars) Fiscal year 2020 to 2021 Fiscal year 2019 to 2020
Total available for use for the year ending March 31, 2021Footnote a Used during the quarter ended June 30, 2020 Year to date used at quarter-end Total available for use for the year ending March 31, 2020Footnote a Used during the quarter ended June 30, 2019 Year to date used at quarter-end
Vote 1 – Operating expenditures 6,841 38 38 0 0 0
Vote 5 – Grants and contributions 4,125 0 0 0 0 0
Statutory authorities Contributions to the employee benefit plan 697 174 174 0 0 0
Total budgetary authorities 11,663 212 212 0 0 0

Table 2: Departmental budgetary expenditures by standard object (unaudited)

Table 2: Departmental budgetary expenditures
Expenditures (in thousands of dollars) Fiscal year 2020 to 2021 Fiscal year 2019 to 2020
Total available for use for the year ending March 31, 2021Footnote b Used during the quarter ended June 30, 2020 Year to date used at quarter-end Total available for use for the year ending March 31, 2020Footnote b Used during the quarter ended June 30, 2019 Year to date used at quarter-end
Personnel 4,228 174 174 0 0 0
Transportation and communications 776 0 0 0 0 0
Information 300 7 7 0 0 0
Professional and special services 884 29 29 0 0 0
Rentals 611 0 0 0 0 0
Repair and maintenance 0 0 0 0 0 0
Utilities, materials and supplies 0 0 0 0 0 0
Acquisition of land, building and works 495 0   0   0 0 0
Acquisition of machinery and equipment 244 2 2 0 0 0
Other subsidies and payments 0 0 0 0 0 0
Transfer payments 4,125 0 0 0 0 0
Total budgetary authorities 11,663 212 212 0 0 0
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