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Quarterly financial report for the quarter ended June 30, 2014

Introduction

This quarterly 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 Treasury Board. It should be read in conjunction with the Main Estimates as well as Canada's Economic Action Plan 2012 (Budget 2012). This quarterly report has not been subject to an external audit or review.

The OCL mandate is stated in the Lobbying Act and covers three areas of activity: maintaining a registry of lobbyists that is accessible to Canadians; fostering greater awareness of the requirements of the Lobbying Act through education and outreach; and ensuring compliance with the legislation and the Lobbyists' Code of Conduct.

Further details on the OCL's programs may be found in the 2014-15 Report on Plans and Priorities and in the Main Estimates.

Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the OCL's spending authorities granted by Parliament and those used by the organization consistent with the Main Estimates for the 2014-15 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 OCL uses the full accrual method of accounting to prepare and present its annual financial statements that are part of the departmental performance 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

Statement of authorities

The total authorities available as of June 30, 2014 have increased by $27K compared to the same quarter of the prior year, which is mainly attributable to adjustments to the salary envelope and related employee benefits plan.

Statement of budgetary expenditures by standard object

The OCL has spent approximately 23% of its authorities in the first quarter of 2014-15. The most significant expenditures are for personnel expenditures and they represent approximately 76% of the total amount spent as of June 30, 2014.

The total spent for other operating costs is approximately 16% of the annual planned expenditures related to other operating costs. This is explained by the fact that the OCL acquires some of its corporate services from other government entities through Memoranda of Understanding (MOUs) for information technology, human resources and financial services, and some of the invoices for services rendered for the first quarter were not received before the end of the quarter and consequently, not reflected in this report.

The organization's quarterly spending is higher than that of the previous year (increase of $113,227 or 13%). The most significant changes are for personnel expenditures, professional and special services and other subsidies and payments.

The increase in personnel expenditures ($35,069 or 5%) is primarily related the arrival of two new employees and to salary increments from collective agreements.

The decrease in professional and special services ($15,350 or 13%) is due to a reduction of contracts issued.

The increase of $100,135 in other subsidies and payments is due to a one-time transition payment of $100,135 for implementing salary payment in arrears by the Government of Canada.

Risks and uncertainties

A financial risk arises due to the fact that the Commissioner's decisions with respect to administrative reviews, investigations and applications for exemption from the five-year prohibition on lobbying may be subject to judicial review by the Federal Court. The current amount allocated for funding legal work would be insufficient in the event of a significant litigation.

Significant changes in relation to operations, personnel and programs

There have been no significant changes in the organization during the current quarter related to programs.

Budget 2012 implementation

This section provides an overview of the savings measures announced in Budget 2012 that have been implemented in order to refocus government and programs; make it easier for Canadians and business to deal with their government; and, modernize and reduce the back office.

As part of the measures announced in the Budget 2012, the OCL's reference levels for its operating budget were reduced by 5% ($230K) starting in 2013-14.

In order to absorb the reduction, the development of new system features in the Registry of Lobbyists has been deferred. Also, to reduce the cost of maintaining the Lobbyist Registration System and the dependency on consultants, a Business and Systems Analyst was hired as of April 2, 2013.

Essential maintenance work continued to be performed on the registration system to prevent system failure and minimize downtime when failures do occur.

Approval by Senior Officials

Approved by:

Karen E. Shepherd
Commissioner of Lobbying
René Leblanc
Deputy Commissioner and Chief Financial Officer

Ottawa, Canada
August 29, 2014

Statement of authorities (unaudited)

Fiscal Year 2014-15 (in thousands of dollars)
Total available for use for the year ending March 31, 2015Footnote 1 Used during the quarter ended June 30, 2014 Year to date used at quarter-end
Vote 45 - Program Expenditures 4,015 904 904
Statutory - Contributions to Employee Benefit Plans 417 104 104
Total Authorities 4,432 1,008 1,008
Fiscal Year 2013-14 (in thousands of dollars)
Total available for use for the year ending March 31, 2014Footnote 2 Used during the quarter ended June 30, 2013 Year to date used at quarter-end
Vote 45 - Program Expenditures 3,989 786 786
Statutory - Contributions to Employee Benefit Plans 435 109 109
Total Authorities 4,424 895 895

Departmental budgetary expenditures by standard object (unaudited)

Fiscal Year 2014-15 (in thousands of dollars)
Expenditures: Planned expenditures for the year ending March 31, 2015 Expended during the quarter ended June 30, 2014 Year to date used at quarter-end
Personnel 2,942 764 764
Transportation and communications 73 10 10
Information 45 3 3
Professional and special services 1,270 103 103
Rentals 57 22 22
Repair and maintenance 15 - -
Utilities, materials and supplies 20 3 3
Acquisition of machinery and equipment 10 3 3
Other subsidies and payments - 100 100
Total net budgetary expenditures 4,432 1,008 1,008
Fiscal Year 2013-14 (in thousands of dollars)
Expenditures: Planned expenditures for the year ending March 31, 2014 Expended during the quarter ended June 30, 2013 Year to date used at quarter-end
Personnel 2,934 729 729
Transportation and communications 71 14 14
Information 32 11 11
Professional and special services 1,298 118 118
Rentals 40 21 21
Repair and maintenance 4 - -
Utilities, materials and supplies 40 2 2
Acquisition of machinery and equipment 5 - -
Other subsidies and payments - - -
Total net budgetary expenditures 4,424 895 895
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