ARCHIVED - Quarterly Financial Report - For the quarter ended 30 June 2013

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Quarterly Financial Report - For the quarter ended 30 June 2013 [PDF 2685 KB]

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

Introduction

The quarterly financial report for the National Energy Board (NEB or Board):

  • should be read in conjunction with the Main Estimates;
  • 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; and
  • has not been subject to an external audit or review.

The Board's top priorities are the continual improvement of safety and environmental outcomes, a robust regulatory framework for the North, and a flexible and efficient organization able to meet new and ongoing priorities.

A summary description of the NEB’s program activities can be found in Part II of the Main Estimates.

The NEB receives most of its funding through annual Parliamentary authorities.  The majority of these expenditures are subsequently recovered from the companies regulated by the NEB and the funds are deposited in the Consolidated Revenue Fund of the Government of Canada.

Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the National Energy Board's spending authorities granted by Parliament and those used by the department, consistent with the Main Estimates and Supplementary Estimates for the 2013-14 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 National Energy Board uses the full accrual method of accounting to prepare and present its annual departmental 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 Results

Actual Expenditures

The increase of $1.6M in personnel spending in the first quarter of 2013-14 compared to 2012-13 is a result of Budget 2012.  Additional information can be found in the Budget 2012 Implementation section of this document.

Professional and special services expenditures are $0.55M greater in Q1 2013-14 over the same period of the previous year. The increase is the result of $0.35M for consultation charges related to the NEB office relocation (in fiscal year 2014-15) as well as increased spending on IT projects of approximately $0.2M.

Planned Expenditures

The variances in planned expenditures for 2013-14 over the previous year are as follows:

  • Funding received through Budget 2012 has resulted in planned spending increases in both personnel ($5.1M) and transportation and communication ($0.4).  Refer to the Budget 2012 Implementation section for more information on these increases.
  • Transfer payments relate to the NEB's Participant Funding Program.  Funding for this program decreased by $2.2M in 2013-14 as a result of $3.0M in special purpose funding that had been allocated to 2012-13.  The projects associated with this one time funding were subsequently postponed and the $3.0 has been reprofiled; $0.75M was allocated to 2013-14 and $2.25M  has been allocated to 2014-15. 

Risks and Uncertainties

The NEB operates within an evolving economic, environmental and social landscape. Dynamics such as high levels of sovereign debt in industrialized economies worldwide and an abundant energy supply in North America have impacted energy markets. Due to the nature of its mandate, the NEB's expenditures are influenced by planned and unplanned events (internal and external) that create uncertainty in expenditures and resource pressures. 

The skills and experience needed by the NEB to fulfill its mandate are in high demand throughout the oil and gas industry. The NEB has experienced increasing attrition rates and non-productive staffing processes, highlighting a potential return to the very competitive recruitment environment for skilled staff within the energy sector. To mitigate this risk, the NEB has initiated a strong and strategic focus on recruitment and retention to ensure it has the right people, at the right time, for the right jobs.

Significant Changes in Relation to Operations, Personnel and Programs

The approval of additional personnel to enhance priority processes for the National Energy Board has resulted in an increase to NEB authorities.

Budget 2012 Implementation

This section provides an overview of the savings measures announced in Budget 2012 that will be 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.

The NEB is unaffected by the savings measure announced in Budget 2012. The department received additional funding over two years to strengthen pipeline safety.  It is expected that inspections will increase from 100 to 150 per year and the number of annual comprehensive audits will double from 3 to 6. 

Approval by Senior Officials

Approved by,

The original version was signed by
_________________________________
Gaétan Caron, Chair and CEO

(Calgary, Canada)
(30 August 2013)

The original version was signed by
_________________________________
Ed Jansen, Chief Financial Officer

STATEMENT OF AUTHORITIES (unaudited)

Fiscal year 2013-2014
  Planned expenditures for the year ending March 31, 2014[a] Expended during the quarter ended June 30, 2013 Year to date used at quarter-end

More information is available in the attached table.

[a] Includes only Authorities available for use and granted by Parliament at quarter-end (does not include Supplementary Estimates).

Operating expenditures 55,241 14,562 14,562
Contributions to employee benefit plans 7,195 1,799 1,799
Total Budgetary authorities 62,436 16,361 16,361
Non-budgetary authorities - - -
Total authorities 62,436 16,361 16,361
Fiscal year 2012-2013
  Planned expenditures for the year ending March 31, 2013[b] Expended during the quarter ended June 30, 2012 Year to date used at quarter-end

More information is available in the attached table.

[b] Includes only Authorities available for use and granted by Parliament at quarter-end (does not include Supplementary Estimates).

Operating expenditures 52,592 12,343 12,343
Contributions to employee benefit plans 6,495 1,624 1,624
Total Budgetary authorities 59,087 13,967 13,967
Non-budgetary authorities - - -
Total authorities 59,087 13,967 13,967

DEPARTMENTAL BUDGETARY EXPENDITURES BY STANDARD OBJECT (unaudited)

Fiscal year 2013-2014
(in thousands of dollars) Planned expenditures for the year ending March 31, 2014[c] Expended during the quarter ended June 30, 2013 Year to date used at quarter-end

[c] Includes only Authorities available for use and granted by Parliament at quarter-end (does not include Supplementary Estimates).

Expenditures:      
Personnel 48,546 13,481 13,481
Transportation and communications 3,415 788 788
Information 589 92 92
Professional and special services 5,417 1,430 1,430
Rentals 589 119 119
Repair and maintenance 471 338 338
Utilities, materials and supplies 471 49 49
Acquisition of land, buildings and works - - -
Acquisition of machinery and equipment 824 23 23
Transfer payments 2,114 - -
Public debt charges - - -
Other subsidies and payments - 41 41
Total gross budgetary expenditures 62,436 16,361 16,361
Fiscal year 2012-2013
(in thousands of dollars) Planned expenditures for the year ending March 31, 2013[d] Expended during the quarter ended June 30, 2012 Year to date used at quarter-end

[d]Includes only Authorities available for use and granted by Parliament at quarter-end (does not include Supplementary Estimates).

Expenditures:      
Personnel 43,395 11,871 11,871
Transportation and communications 3,065 614 614
Information 568 119 119
Professional and special services 5,335 880 880
Rentals 341 74 74
Repair and maintenance 681 162 162
Utilities, materials and supplies 454 57 57
Acquisition of land, buildings and works - - -
Acquisition of machinery and equipment 908 76 76
Transfer payments 4,340 64 64
Public debt charges - - -
Other subsidies and payments - 50 50
Total gross budgetary expenditures 59,087 13,967 13,967
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