Quarterly Financial Report for the Quarter Ended December 31, 2024

Introduction

This quarterly report has been prepared by management as required by section 65.1 of the Financial Administration Actand in the form and manner prescribed by the Treasury Board. This quarterly report should be read in conjunction with the Main Estimates and Supplementary Estimates.

The Transportation Safety Board of Canada’s (TSB’s) sole objective is to advance air, marine, pipeline and rail transportation safety. This mandate is fulfilled by conducting independent investigations into selected transportation occurrences to identify the causes and contributing factors, and the safety deficiencies evidenced by these occurrences. The TSB makes recommendations to reduce or eliminate any such safety deficiencies and reports publicly on its investigations. The TSB then follows up with stakeholders to ensure that safety actions are taken to reduce risks and improve safety.

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

Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the TSB’s spending authorities granted by Parliament and those used by the department. Authorities include amounts granted through the Main Estimates and Supplementary Estimates (as applicable) for the 2024-25 fiscal year and any respendable revenue earned and available for use to quarter end. 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.

TSB uses the full accrual method of accounting to prepare and present its annual departmental financial statements, which are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

Highlights of fiscal quarter and fiscal year to date results

Statement of Authorities

The TSB’s total authorities available for use decreased by $1.3 million between fiscal years 2023-24 and 2024-25, driven by several key factors. The TSB secured new funding through Budget 2023, which allocated one-time resources for critical TSB operations, most notably for essential IT investments. Additionally, the TSB received funding to support employee salary increases resulting from newly signed and ratified collective bargaining agreements. While funding was received in both fiscal years for these items, the 2023-24 funding included retroactive payments for most TSB employees, resulting in a slightly higher amount compared to the 2024-25 allocation. Furthermore, the TSB’s operating budget carryforward (OBCF) for 2024-25 was slightly lower than the amount carried forward in the prior fiscal year. The Government of Canada’s Refocusing Government Spending initiative also had a minor impact, although the variation between the two years was minimal.

In comparison to the second quarter, appropriations for 2024-25 increased by $0.5 million, primarily due to the allocation of funds for employee salary increases linked to the newly signed collective bargaining agreements, which were received in the third quarter.

Statement of Departmental Budgetary Expenditures

The department’s year-to-date spending has increased by $1.1 million, or 4%, compared to the same period in 2023-24. This variance in expenditures is primarily due to higher costs in three key areas: personnel, professional and special services, and the acquisition of machinery and equipment. The majority of this increase can be attributed to higher salary expenses, driven by two main factors: the hiring of new employees funded through Budget 2023, and salary increases resulting from newly signed and ratified collective bargaining agreements.

The increase in spending on professional and special services is primarily attributed to the need for IT project consultants to support the migration of various applications to a cloud-based architecture. This includes the transition of the server-based SharePoint platform to SharePoint Online, a key initiative within the TSB's broader digital transformation strategy.

The increase in expenditures for the acquisition of machinery and equipment is principally attributable to the purchase of servers and software to support cloud-based information storage. This investment is in line with the TSB's commitment to becoming digital-by-default and serves to further enhance its IT infrastructure.

As illustrated in Figure 1, the TSB has spent approximately 69% of its available authorities at the end of the third quarter. This is below the anticipated rate, considering that the salaries represent the department's most significant expenditure. Typically, the TSB's spending is expected to be evenly distributed throughout the fiscal year.

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Risks and Uncertainties

A continuous risk to the TSB’s financial situation is that expenditures are greatly influenced by the number and complexity of transportation occurrences. A significant transportation accident or a flurry of smaller size occurrences could significantly increase expenditures and result in additional resource pressures that could require the department to seek further funding from Parliament.

As a departmental corporation, the TSB has authority to spend revenues received during the year although such revenues are minimal; on average less than 1% of the department’s funding requirements.

Significant Changes in Relation to Operations, Personnel and Programs

Budget 2023 introduced new funding for critical TSB operations.  This included funding for the hiring of 22 new full-time equivalents and for crucial IT investments.  In addition, the TSB is also implementing savings measures in line with the Government of Canada’s Refocusing Government Spending initiative.

There has been no change to the TSB’s programs.

Approval by senior officials

Approved by,                                                           

Yoan Marier                                                                        
Chair                                                                                      
Gatineau, Canada                                                        

James Clarkin, CPA, CMA                                 
Chief Financial Officer                                                                                       
Gatineau, Canada 

Statement of Authorities (unaudited)

Fiscal year 2024-25 ¹

Fiscal year 2023-24 (in thousands of dollars)¹

Statement of Expenditures by Standard Object (unaudited)

Fiscal year 2024-25 (in thousands of dollars) ¹

Fiscal year 2023-24 (in thousands of dollars) ¹