National Security and Intelligence Review Agency - Quarterly financial report for the quarter ended December 31, 2021

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

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 Directive on Accounting Standards, GC 4400 Departmental Quarterly Financial Report. This quarterly financial report should be read in conjunction with the 2021–22 Main Estimates.

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

Mandate

The National Security and Intelligence Review Agency (NSIRA) is an independent external review body that reports to Parliament. Established in July 2019, NSIRA is responsible for conducting reviews of the Government of Canada’s national security and intelligence activities to ensure that they are lawful, reasonable and necessary. NSIRA also hears public complaints regarding key national security agencies and their activities.

A summary description NSIRA’s program activities can be found in Part II of the Main Estimates. Information on NSIRA’s mandate can be found on its website.

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 2021–22 Main Estimates. This quarterly report has been prepared using a special-purpose financial reporting framework (cash basis) designed to meet financial information needs with respect to the use of spending authorities.

The authority of Parliament is required before money 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 authorities for specific purposes.

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

This section highlights the significant items that contributed to the net increase or decrease in authorities available for the year and actual expenditures for the quarter ended December 31, 2021.

NSIRA spent approximately 33% of its authorities by the end of the third quarter, compared with 28% in the same quarter of 2020–21 (see graph 1).

Graph 1: Comparison of total authorities and total net budgetary expenditures, Q3 2021–22 and Q3 2020–21

Significant changes to authorities

As at December 31, 2021, Parliament had approved $31.3 million in total authorities for use by NSIRA for 2021–22 compared with $24.0 million as of December 31, 2020, for a net increase of $7.3 million or 30.4% (see graph 2).

Graph 2: Variance in authorities as at December 31, 2021

The increase of $7.3 million in authorities is mostly explained by the ramp-up of approved funding for the mandate of NSIRA and the approval of a funding re-profile into fiscal year 2021–22 for accommodation and infrastructure projects.

Significant changes to quarter expenditures

The third quarter expenditures totalled $3.7 million for an increase of $1.0 million when compared with $2.7 million spent during the same period in 2020–21. Table 1 presents budgetary expenditures by standard object.

Table 1

Variances in expenditures by
standard object

(in thousands of dollars)
Fiscal year 2021–22: expended during the quarter ended December 31, 2021 Fiscal year 2020–21: expended during the quarter ended December 31, 2020 Variance $ Variance %
Personnel 2,654 1,732 922 53%
Transportation and communications 93 19 74 389%
Information 24 37 (13) (35%)
Professional and special services 404 389 15 4%
Rentals 64 41 23 56%
Repair and maintenance 398 189 209 111%
Utilities, materials and supplies 13 21 (8) (38%)
Acquisition of machinery and equipment 72 258 (185) (72%)
Other subsidies and payments (22) (13) (9) 69%
Total gross budgetary expenditures 3,700 2,671 1,029 39%

Details may not sum to totals due to rounding

Personnel

The increase of $922,000 relates to additional staffing to support NSIRA’s mandate.

Transportation and communications

The increase of $74,000 relates to new internet connections as part of the office accommodation fit-up costs.

Repair and maintenance

The increase of $209,000 is explained by office accommodation fit-up costs.

Acquisition of machinery and equipment

The decrease of $185,000 is mainly explained by capital costs not needed in 2021–22 because they were ramp-up and pandemic-related expenditures in 2020–21: buying furniture acquisitions, redesigning office space to accommodate more employees, and equipping NSRIA personnel to work from home.

Significant changes to year-to-date expenditures

The year-to-date expenditures totalled $10.2 million for an increase of $3.6 million (54%) when compared with $6.6 million spent during the same period in 2020–21. Table 2 presents budgetary expenditures by standard object.

Table 2

Variances in expenditures by
standard object

(in thousands of dollars)
Fiscal year 2021–22: year-to-date expenditures as of December 31, 2021 Fiscal year 2020–21: year-to-date expenditures as of December 31, 2020 Variance $ Variance %
Personnel 7,407 5,072 2,335 46%
Transportation and communications 130 37 93 251%
Information 41 78 (37) (47%)
Professional and special services 1,440 731 709 97%
Rentals 81 104 (23) (22%)
Repair and maintenance 611 247 364 147%
Utilities, materials and supplies 25 28 (3) (11%)
Acquisition of machinery and equipment 446 300 146 49%
Other subsidies and payments 18 28 (10) (36%)
Total gross budgetary expenditures 10,199 6,626 3,573 54%

Details may not sum to totals due to rounding

Personnel

The increase of $2,335,000 relates to additional staffing to support NSIRA’s mandate.

Transportation and communications

The increase of $93,000 is mainly explained by the installation of new internet connections as part of the office accommodation fit-up costs, and some relocation and travel expenses.

Professional and special services

The increase of $709,000 is mainly due to information technology support services by the Communications Security Establishment and an increased use of procurement advisory services.

Repair and maintenance

The increase of $364,000 is explained by office accommodation fit-up costs.

Acquisition of machinery and equipment

The increase of $146,000 is mainly explained by informatics equipment acquisitions.

Risks and uncertainties

The ability of NSIRA to access the information it needs to conduct its reviews and complaints investigations is closely tied to the capacity of the reviewed or investigated departments and agencies to respond to NSIRA’s demands. The pandemic continues to hinder the agency’s ability to conduct classified work in the workplace. When combined with existing resource constraints of the reviewed departments and agencies, the conduct of reviews continues to be delayed.

NSIRA is closely monitoring pay transactions to identify and address over and under payments in a timely manner and continues to apply ongoing mitigating controls.

Mitigation measures for the risks outlined above have been identified and are factored into NSIRA’s approach and timelines for the execution of its mandated activities.

Significant changes in relation to operations, personnel and programs

There have been no new Governor-in-Council appointments during the third quarter.

There have been no changes to the NSIRA Program.

 

Approved by senior officials:

______________________ ______________________
John Davies Pierre Souligny
Executive Director Senior Director, Corporate Services,
Chief Financial Officer
Ottawa, Canada
Date:

Appendix

Statement of authorities (unaudited)

(in thousands of dollars) Fiscal year 2021–22 Fiscal year 2020–21
Total available for use for the year ending March 31, 2022 (note 1) Used during the quarter ended December 31, 2021 Year to date used at quarter-end Total available for use for the year ending March 31, 2021 (note 1) Used during the quarter ended December 31, 2020 Year to date used at quarter-end
Vote 1 – Net operating expenditures 29,615 3,274 8,921 22,565 2,300 5,513
Budgetary statutory authorities
Contributions to employee benefit plans 1,705 426 1,278 1,484 371 1,113
Total budgetary authorities (note 2) 31,319 3,700 10,199 24,049 2,671 6,626

Note 1: Includes only authorities available for use and granted by Parliament as at quarter-end.

Note 2: Details may not sum to totals due to rounding.

 

Departmental budgetary expenditures by standard object (unaudited)

(in thousands of dollars) Fiscal year 2021–22 Fiscal year 2020–21
Planned expenditures for the
year ending March 31, 2022 (note 1)
Expended  during the quarter ended December 31, 2021 Year-to-date
used at
quarter-end
Planned expenditures for the year ending March 31, 2021 Expended during the quarter ended December 31, 2020 Year-to-date
used at
quarter-end
Expenditures
Personnel 13,222 2,654 7,407 11,510 1,732 5,072
Transportation and communications 673 93 130 1,162 19 37
Information 375 24 41 364 37 78
Professional and special services 7,029 404 1,440 3,250 389 731
Rentals 188 64 81 237 41 104
Repair and maintenance 8,737 398 611 6,681 189 247
Utilities, materials and supplies 103 13 25 173 21 28
Acquisition of machinery and equipment 991 72 446 393 257 300
Other subsidies and payments 0 (22) 18 278 (13) 28
Total gross budgetary expenditures
(note 2)
31,319 3,700 10,199 24,049 2,671 6,626

Note 1: Includes only authorities available for use and granted by Parliament as at quarter-end.

Note 2: Details may not sum to totals due to rounding.

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