Quarterly Financial Report ending December 31, 2019

Copyright Board of Canada Statement outlining results, risks and significant changes in operations, personnel and program for the Quarter Ended December 31, 2019

Introduction

This quarterly report has been prepared by management as required by section 65.1 of the Financial Administration Act (FAA) and in the form and manner prescribed by the Treasury Board Secretariat (TBS). This quarterly report should be read in conjunction with the Main Estimates.

The Copyright Board of Canada (the Board) is an independent administrative agency that has been conferred department status for purposes of the FAA. Its mandate is set out in the Copyright Act (the "Act"). The Board is empowered to establish, either mandatorily or at the request of an interested party, the royalties to be paid for the use of copyrighted works when the administration of such works is entrusted to a collective administrative society.

The Board’s program objective is to set royalties which are fair and equitable to both copyright owners and users of copyright-protected works. This includes setting fair and equitable terms and conditions so as to permit the use of works when the owner of the copyright cannot be located.

Basis of Presentation:

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Board’s spending authorities granted by Parliament and those used by the Board, consistent with the Main Estimates for the 2019-19 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.

As part of the performance reporting process, the Board prepares its annual departmental financial statements on a full accrual basis in accordance with TBS accounting policies, which are based on Canadian generally accepted 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 Results

Total authorities used during the quarter ended December 31, 2019 were $923,000, a decrease of $80,000 when comparing to the same quarter last year. Total authorities Copyright Board of Canada Quarterly Financial Report For the quarter ended December 31, 2019 used to date however increased by more than $200,000 compared to last year, reflecting higher spending on personnel.

The decrease in spending for the quarter ending December 31, 2019 is a reflection of lower spending on professional and special services for that quarter. However, higher spending on a year to date basis reflected higher personnel spending, as well as on professional and special services. Expenditures on utilities, materials and supplies decreased by $36,000, and those on machinery and equipment by $22,000. These changes reflected operational needs.

Risks and Uncertainties:

The Board's most significant expenditure is personnel which represents about 70% of its planned expenditures. Because of the very small size of the Board, this implies that whenever an employee departs due to retirement or resignation or a new employee is hired to replace the departing one, there is a risk of substantial variation in quarterly expenditures.

In addition, the Board's expenditures are influenced by the number and complexity of tariffs that it has to establish. A significant increase in the number of hearings can result in resource pressures.

Significant Changes in Relation to Operations, Personnel and Programs:

As part of Canada's Intellectual Property Strategy, Federal Budget 2018 announced a 30% increase in the Board's financial resources, to increase its internal capacity to support more efficient processes. Funds were obtained in early 2019, leading to increasing spending in a number of categories including personnel, communication and information management.

Approval by Senior Officials

Approved by,

Nathalie Théberge	Deputy Head
Lara Taylor	Chief Financial Officer

Statement of Authorities (unaudited)

	Fiscal Year 2019-2020
(in thousand of dollars)	Total available for use for the year ending March 31, 2020*	Used during the quarter ended December 31, 2019	Year to date used at quarter-end
Vote 45 - Net Operating expenditures	3,782	824	2,453
Budgetary statutory authorities
Employee benefit plans	396	99	297
Total authorities	4,178	923	2,750
* Includes approved estimates documents as at quarter end.
	Fiscal Year 2018-19
(in thousand of dollars)	Total available for use for the year ending March 31, 2019*	Used during the quarter ended December 31, 2018	Year to date used at quarter-end
Vote 45 - Net Operating expenditures	3,057	929	2,320
Budgetary statutory authorities
Employee benefit plans	272	74	223
Total authorities	3,329	1,003	2,543
* Includes approved estimates documents as at quarter end.

Table 1: Departmental budgetary expenditures by Standard Object (unaudited)

	Fiscal Year 2019-2020
(in thousand of dollars)	Planned expenditures for the year ending March 31, 2020*	Expended during the quarter ended December 31, 2019	Year to date used at quarter-end
Expenditures
Personnel	2,986	737	2,051
Transportation and communications	75	20	45
Information	185	18	124
Professional and special services	615	86	368
Rentals	90	23	69
Repair and maintenance	142	20	56
Utilities, materials and supplies	65	7	10
Acquisition of machinery and equipment	20	10	18
Other subsidies and payments	-	2	9
Total net budgetary expenditures	4,178	923	2,750
* Includes approved estimates documents as at quarter end.
	Fiscal Year 2018-19
(in thousand of dollars)	Planned expenditures for the year ending March 31, 2019*	Expended during the quarter ended December 31, 2018	Year to date used at quarter-end
Personnel	2,033	715	1,817
Transportation and communications	60	26	44
Information	222	14	139
Professional and special services	786	138	340
Rentals	100	27	47
Repair and maintenance	58	27	41
Utilities, materials and supplies	50	19	46
Acquisition of machinery and equipment	20	12	40
Other subsidies and payments	-	25	29
Total net budgetary expenditures	3,329	1,003	2,543
* Includes approved estimates documents as at quarter end.