Quarterly financial report for the quarter ended September 30, 2020

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. This quarterly report has not been subject to an external audit or review. However, it has been reviewed by the OCL Audit and Evaluation Committee.

The OCL mandate is stated in the Lobbying Act and covers three areas of activity:

• Establish and maintain the Registry of Lobbyists, which contains and makes public the information disclosed by lobbyists;
• Develop and implement educational programs to foster public awareness of the requirements of the Act; and
• Undertake investigations to ensure compliance with the Act and the Lobbyists' Code of Conduct.

Further details on the OCL’s programs may be found in the 2020-21 Departmental Plan 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 2020-21 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 for use as of September 30, 2020, represent 9/12 of total authorities expected. In comparison to the previous fiscal year total appropriations as at September 30, 2020 decreased by $1,387K. The decrease is mainly attributable to the reduced supply of Main Estimates and to the specified purpose allotment for relocation of the office of $350K received in the previous fiscal year. Due to COVID-19 pandemic and limited parliamentary sessions to study supply, the Standing Orders of the House of Commons were amended to extend the study period into the fall. The Office of the Commissioner of Lobbying is expected to receive full supply for the 2020-21 Main Estimates in December 2020.

Statement of budgetary expenditures by standard object

The OCL has spent approximately 60% of its authorities at the end of the second quarter of 2020-21. The most significant expenditures are for personnel representing approximately 76% of the total amount spent as of September 30, 2020.

The other operating costs represent approximately 63% of the annual planned expenses (prorated by 9/12) foreseen in this regard. This represents expenditures that the OCL acquire for some of its corporate services from other government entities through Memoranda of Understanding (MOUs) for information technology, human resources and financial services.

The organization’s spending at the end of the second quarter increased by $144K when compared to the previous year results. The increase is related to an increase of $313K in personnel expenditures and a decrease of $170K to expenditures linked to the office relocation.

Risks and uncertainties

A financial risk arises due to the fact that the Commissioner’s decisions with respect to 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. As well, the organization’s core system, the Lobbyists’ Registration System (LRS), may be at risk if the external consultants who possess substantial corporate memory concerning its design and operation depart or their contracts expire.

Significant changes in relation to operations, personnel and programs

In September 2019, the positions of Director of Investigations and Corporate Services were temporarily combined and held by one FTE. In September 2020, due to workload, these positions were reverted to being two distinct positions to be held by two FTEs. There were no other significant changes during the current quarter.

Approval by senior officials

Approved by:

Ottawa, Canada
November 9, 2020

Statement of authorities (unaudited)

Budgetary expenditures by standard object (unaudited)