Table of Contents 1 Budget Vision amp Approach Budget Focus amp Development Key Factors Impacting the Budget 4 How is the Budget Funded ID: 781241
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Slide1
2020 Approved Budget
1
Slide2Table of Contents
1
Budget
Vision & ApproachBudget Focus & DevelopmentKey Factors Impacting the Budget 4How is the Budget Funded?Use of Fund Balances 4 6 824 252Full Fee Equivalent Licensees2020 Annual Fee Historical Annual Fees for LawyersHistorical Annual Fees for Paralegals5Governance & Policy Support of Other Organizations Professional Development & CompetenceProfessional Regulation & TribunalClient & People ServicesAdministration11 12131427313743505632020 Budget Summary - Consolidated 2020 Budget Summary - Lawyers 2020 Budget Summary - Paralegals 2020 General Fund Expense Breakdown2018-2020 Budget Comparison2020 Budget by Group2018-2020 FTE Comparison 6Compensation FundsCapital FundCounty Libraries FundErrors and Omissions Insurance Fund1617181920212264666768
Budget Overview
Funding the Budget
Annual Fees
Operations by Division
2020 Budget at a Glance
Other Funds
2
Slide3Budget Overview
1
3
Slide4Budget Vision & Approach
The process for the development of
the
2020 Law Society of Ontario budget has been ongoing since early 2019. Having just completed one full year in office, the CEO, along with a new Senior Management Executive have taken the opportunity to reconsider the approach to operations and budget management. The organization has been through a period of change which included a focus on creating enhanced stability within and across divisions and prioritization of regulatory functions. The activity recalibrated the tone and approach of our work together, within operational units and with the Board. As a general principle, past budgeting exercises at the Law Society have tended to include allowances for policy projects and program implementation anticipated to be approved within a coming budget year. The approved budget for 2020 no longer anticipates the implementation of policy projects and programs, and therefore does not include any related budget estimates.For the 2020 budget, each division was requested to clarify projections based on a three year review of actual expenditures. This analysis, supported by the CFO and Finance team in partnership with Senior Managers, has produced a budget that more closely reflects anticipated actual spending and will tighten variances between projected and actual results. The change in approach has produced a budget that reduces the annual licence fee for lawyers and paralegals in 2020.Message from the CEO4
Slide5Budget Vision & Approach
This approach to budgeting has an impact on how the organization will address policy and program activities moving forward. As 2019 comes to a close, and 2020 policy deliberations move forward at the Board, approval of any new projects or programs will be presented on the basis that costs of implementation will not be incurred until the following fiscal period (2021). Alternatively, if a project or program is time sensitive or deemed critical, on recommendation by the relevant policy committee and confirmation of existing contingency funds by the Audit & Finance Committee, use of contingency funds may be recommended and approved by Convocation to the extent that monies remain available and priorities have been assessed.
In addition to these modifications, the CEO has directed management to ensure that all proposals for policies, projects and programs be presented with cost/benefit/risk recommendations. This may, where appropriate, also include recommendations for the reduction of costs in other projects and programs, with a focus on avoiding policy and operational duplication.
With this new approach, the organization will also be in a better position to address decision-making that results from the deliberations of two new task forces meant to address the scope of the Law Society’s work – the Proportionate Regulation Task Force and the Program Review Task Force.Management looks forward to working with newly elected and appointed Board members to further clarify the Law Society’s project and program approvals process and finances. Message from the CEO5
Slide6Budget Focus and Development
The 2020 budget has been developed with the objectives of:
focusing on the Law Society’s core operations and serving the public, licensees and candidates
reducing the annual fee for licensees and maintaining a zero increase for candidates in the Licensing Process, andmitigating risk by ensuring the Law Society’s strong financial position is maintained.The 2020 budget also takes into account policy decisions that require incremental funding such as the enhancement of the Practice Management Helpline and trends in the licensee membership relating to the calculation of full fee equivalent paying licensees.The 2020 budget is also restructured to introduce a central operations contingency intended to fund unanticipated scenarios that may arise during the year such as extraordinary litigation matters or short term costs incurred to implement efficiencies that will result in long term savings. This consolidated approach to managing for possible in-year impacts allows for a reduction in budgeted funds across departments. More importantly, this approach supports centralized control of operational spending related to unanticipated situations with all such matters now requiring CEO approval and enhanced CFO financial and budgetary oversight. Message from the CFO6
Slide7Budget Focus and Development
This budget plans for the return of the lawyer Compensation Fund
fund
balance to the required level under the Law Society fund balance policies. This is the final year of a three year plan to restore the fund balance and includes an additional $5 million levied from lawyers. The effects of the grant limit change from $150,000 to $500,000 are now being realized as the initial receipt of claims begins. To ensure that the fund balance is adequate, and with the benefit of more information since inception of the increased grant level, an actuarial review of fund balance requirements based on most recent experience will be undertaken to support 2021 budget planning. The fee related to the paralegal Compensation Fund remains unchanged with risk to the fund balance managed with a grant limit of $10,000.The capital budget incorporates funding for essential information technology and facilities initiatives. Constant investment in technology and its infrastructure is required to mitigate against the risks associated with out of date systems, untimely updates or lack of maintenance. With the Law Society owning a heritage building and grounds, maintenance of the premises is costly and complex, both from the perspective of maintaining its historical integrity and working with old infrastructure. The capital budget includes a contingency for in-year unanticipated or urgent needs. Spending against the contingency requires CEO approval with the CFO providing budgetary oversight.Message from the CFO7
Slide8Key Factors Impacting the Budget
Historical
expenditure review by senior
executives identified reductions for the 2020 budget totalling approximately $2.8 million in comparison to the 2019 budget.There is a net reduction of 6.5 full time equivalent employees (FTEs) compared to 2019.Funding for the Awareness Campaign’s media buy of $600,000 is not included pending decision by Convocation to continue it, in which case it will be taken from contingency.There will be a reduction of $515,000 in the budget related to the bencher cost centre. This includes removal of the $370,000 budgeted in 2019 to support a possible decision by Convocation to eliminate or reduce the 26 day deductible period for remuneration purposes.8
Slide9Key Factors Impacting the Budget
Contingency funds
intended for
new policy, program or similar decisions of Convocation is set at $1,000,000 in the 2020 budget, a reduction of $500,000.The provision for salary merit increases is 2% and is below CPI.The full fee equivalent licensees for lawyers is projected to increase by 1,400 to 44,000.The full fee equivalent licensees for paralegals is projected to increase by 100 to 6,400.9
Slide10Annual Fees
2
10
Slide11Full Fee Equivalent LicenseesAnnual fees for licensees are determined separately for lawyers and paralegals. Paralegals do not share in all the expenses of the Society nor benefit from all
non-annual
fee revenue. For example, paralegals do not contribute to the operations of LibraryCo nor do they share in the portion of investment income transferred from the Errors & Omissions Insurance Fund as that fund is dedicated strictly to lawyer related insurance transactions between the Law Society and
LAWPRO.The Law Society utilizes a three tiered fee structure depending on the nature of the licensee’s practising/employment status. Licensees practising law or providing legal services pay 100% of the relevant annual fee; those employed but not practising pay 50%; those retired or not working pay 25%.The number of licensees in each category are prorated to determine what the number of lawyers and paralegals would equate to at the 100% fee category. This is referred to in the budget materials as the number of full fee equivalent licensees (FFE).LawyersFee CategoryEstimated NumberFull Fee Equivalent100%39,50039,50050%6,8003,40025%4,2001,100Total50,50044,000ParalegalsFee CategoryEstimated NumberFull Fee Equivalent100%4,3004,30050%3,2001,60025%2,000500Total9,5006,40011
Slide122020 Annual Fee
$2,066
$1,006
12
Slide13Historical Annual Fees For Lawyers
Annual Fee Breakdown
2015
20162017201820192020 ApprovedGeneral Fund$ 1,563 $ 1,555 $ 1,531 $ 1,598 $ 1,693 $ 1,574 Compensation Fund 32 71 87 300 226 219 LibraryCo 202 194 194 194 191 182 Capital Fund 69 47 104 91 91 91 Total Annual Fee $ 1,866 $ 1,867 $ 1,916 $ 2,183 $ 2,201 $ 2,066 FFE Lawyers 38,100
39,500
40,200
41,200
42,600
44,000
13
Slide14Historical Annual Fees For Paralegals
Annual Fee Breakdown
2015
20162017201820192020 ApprovedGeneral Fund$ 912 $ 933 $ 925 $ 997 $ 1,009 $ 902 Compensation Fund 15 16 17 12 15 13 Capital Fund 69 47 104 91 91 91 Total Annual Fee $ 996 $ 996 $ 1,046 $ 1,100 $ 1,115 $ 1,006 FFE Paralegals 4,700 5,050 5,600 6,100 6,300 6,40014
Slide15Budget at a Glance
3
15
Slide162020 Budget Summary - Consolidated
Approved
ApprovedChange201920202019 Budget vs Budget Budget 2020 Budget1Annual Fee Revenue100,790,10097,305,400 (3,484,700)2Licensing Process14,157,500 14,478,000 320,5003CPD8,251,000 8,251,000 -4Other Revenue10,625,700
10,693,000
67,300
5
Total Revenues
133,824,300
130,727,400
(3,096,900)
6
Salaries and
Benefits
69,961,200
70,483,400
522,200
7
Operating
4,542,300
4,518,500
(23,800)
8
Program
45,292,300
41,757,800
(3,534,500)
9
General
Fund
119,795,800
116,759,700
(3,036,100)
10
Capital
Fund
4,449,900
4,586,400
136,500
11
LibraryCo
8,152,900
8,019,100
(133,800)
12
Compensation Fund
10,137,100
10,073,600
(63,500)
13
Total
Expenses
142,535,700
139,438,800
(3,096,900) 14Excess of Expenses over Revenues (8,711,400) (8,711,400) - 15E&O Surplus Investment Income1,200,000 1,200,000 -16Fund Balances7,511,400 7,511,400 -17Total Use of Fund Balances 8,711,400 8,711,400 -
16
Slide172020 Budget Summary - Lawyers
Approved
ApprovedChange201920202019 Budget vs Budget Budget 2020 Budget1Annual Fee Revenue93,761,90090,873,900 (2,888,000)2Licensing Process11,860,90012,106,400 245,5003CPD7,322,8007,322,800 -4Other Revenue9,375,4009,434,600 59,200
5
Total
Revenues
122,321,000
119,737,700
(2,583,300)
6
Salaries and
Benefits
61,912,400
62,348,400
436,000
7
Operating
4,034,100
4,016,800
(17,300)
8
Program
40,677,300
37,727,900
(2,949,400)
9
General
Fund
106,623,800
104,093,100
(2,530,700)
10
Capital
Fund
3,876,600
4,004,000
127,400
11
LibraryCo
8,152,900
8,019,100
(133,800)
12
Compensation Fund
9,990,900
9,944,700
(46,200)
13
Total
Expenses
128,644,200
126,060,900
(2,583,300)
14
Excess of Expenses over Revenues
(6,323,200)
(6,323,200)
- 15E&O Surplus Investment Income1,200,0001,200,000 -16Fund Balances5,123,2005,123,200 -17Total Use of Fund Balances 6,323,200 6,323,200 -17
Slide182020 Budget Summary - Paralegals
Approved
ApprovedChange201920202019 Budget vs Budget Budget 2020 Budget1Annual Fee Revenue7,028,2006,431,500 (596,700)2Licensing Process2,296,6002,371,600 75,0003CPD928,200 928,200 -4Other Revenue1,250,300 1,258,400 8,100
5
Total
Revenues
11,503,300
10,989,700
(513,600)
6
Salaries and
Benefits
8,048,800
8,135,000
86,200
7
Operating
508,200
501,700
(6,500)
8
Program
4,615,000
4,029,900
(585,100)
9
General
Fund
13,172,000
12,666,600
(505,400)
10
Capital
Fund
573,300
582,400
9,100
11
Compensation Fund
146,200
128,900
(17,300)
12
Total
Expenses
13,891,500
13,377,900
(513,600)
13
Excess of Expenses Over Revenues
(2,388,200)
(2,388,200) -14Fund Balances2,388,200 2,388,200 -15Total Use of Fund Balances 2,388,200 2,388,200 -18
Slide192020 General Fund Expense Breakdown
19
General Fund
Total 2020 Expenses$116,759,700
Slide202018 – 2020 Budget Comparison
Salaries & Benefits
OperatingProgramCapital FundLibraryCoCompensation FundTotalBudget Expenses201866,951,3004,449,50039,910,5004,304,3007,993,00013,035,000136,643,600201969,961,2004,542,30045,292,3004,449,9008,152,90010,137,100142,535,700202070,483,4004,518,50041,757,8004,586,4008,019,10010,073,600139,438,800Annual FeesLicensing ProcessCPDOther RevenueE&O SurplusFund BalancesTotalBudget Funding201896,652,30013,268,3008,686,00010,495,600600,0006,941,400136,643,6002019100,790,10014,157,5008,251,00010,625,7001,200,0007,511,400142,535,700202097,305,40014,478,0008,251,00010,693,0001,200,0007,511,400139,438,80020
Slide212020 Budget By Group
$139,438,800
21
Slide222018-2020 FTE Comparison
22
Slide23Funding the Budget
4
23
Slide24How is the Budget Funded?
Sources of Revenue
Licensee fees account for approximately 75% of total revenue sources in 2020.
Licensing Process fees represent the next significant component of revenue collected by the Society, making up approximately 11% of Society revenues, with continuing professional development fees being the third largest contributor at approximately 6%. The remaining 8% of revenue is from a variety of sources including investment income, royalties, late fees, catering and events, and additional licensee fees for professional corporations, Law Society referral service and certified specialist.Annual FeesThe annual fees represents the amount paid by lawyers and paralegals to support the operations of the Society. For 2020 the annual fee for lawyers is $2,066 and for paralegals is $1,006.Licensing Process FeesLicensing process fees are the fees paid by licensing candidates enrolled in the lawyer licensing process and the paralegal licensing process. The fees are $4,710 and $1,400, respectively.Continuing Professional DevelopmentContinuing professional development revenues are collected from lawyers, paralegals and others for attendance, in person, online or on demand at Law Society professional development programs.$130.7 million24
Slide25Use of Fund Balances
The Society has fund balance management policies that prescribe the appropriate range of balances to be maintained in both the
General
and Compensation Funds. When balances exceed the policy approved minimums, options are available to utilize a portion of the fund balance to mitigate annual fees. This is a best practice in not for profit budgeting and the 2020 budget proposes the utilization $7.5 million of accumulated fund balances from the lawyer and paralegal General Funds and $1.2 million from the E&O Fund. This will not impair the Society’s financial position or risk being outside the policy approved fund balances and will positively impact the setting of annual licensee fees.$8.7 million25
Slide26Operations by Division
5
26
Slide27Governance & Policy
27
Slide28Overview
Governance & Policy
The Law Society is governed by a board of directors, known as benchers which includes lawyers, paralegals and
appointed representatives (non-lawyers and non-paralegals). The Policy Division groups together a number of functions important to the corporate and governance interests of the Law Society, including policy, committee and Convocation support.Bencher-ConvocationOffice of TreasurerPolicy – Equity InitiativesConvocation governs the Law Society of OntarioBenchers set policy and determine other matters related to the regulation of Ontario’s lawyers and paralegals through committee work and Convocation board meetingsAt the Law Society Tribunal, benchers sit on hearings as adjudicators to hear discipline cases concerning lawyer and paralegal conduct, competence and capacityUnder the Law Society Act, the Treasurer is the president and Chair of the Board of the Law SocietySupports Committees and the Benchers as they make decisions governing the regulation of lawyers and paralegals in the public interestDevelops policy, in collaboration with Benchers and Management, in the Committee processAssists in strategic communications and supports organizational alignment of new policyManages the administration of committees, working groups and task forcesDevelops and implements equity policies and initiatives pertaining to the professions$6.6 million4.7%$6.0 million4.6%28
Slide29Operating Budget Summary
Governance
& Policy
2018 Actuals2019 Projected Actuals2019 Approved Budget2020 Approved Budget% Change Presented / Prior Year ApprovedGovernance & Policy TotalSalaries and Benefits2,038,100 2,078,900 2,495,300 2,135,200 Operating Expenses 106,700 108,800 126,800 126,800 Program Expenses 2,510,100 2,698,700 5,455,600 4,294,400 Total Expenses 4,654,900 4,886,400 8,077,700 6,556,400 -18.8%
Total Non-Annual Fee Revenues
238,700
243,500
190,000
190,000
0.0%
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
4,416,200)
(4,642,900
)
(7,887,700
)
(6,366,400
)
Full Time Equivalent
15.5
12.5
29
Items
of Note
The decrease in salaries and benefits is the result of a reduction of three FTEs in the Policy division.
The change in the program expenses budget
is due
to a return to the traditional $1M contingency fund intended for new policy, program or similar decisions of Convocation, a reduction of $500,000, and a reduction in the budget related to the bencher cost centre of $515,000. The latter includes removal of the $370,000 budgeted in 2019 in support of a possible decision by Convocation to eliminate or reduce the 26 day deductible period for bencher remuneration. There is a realignment of budget related to equity initiatives of $157,000, with funding shifting to other
divisions
with appropriate skills to support equity initiatives.
Slide30Operating Budget Details
Governance & Policy
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetBencher | ConvocationSalaries and Benefits - - - - Operating Expenses - - - - Program Expenses 1,729,100 1,902,000 4,097,600 3,093,800 Total Expenses 1,729,100 1,902,000 4,097,600 3,093,800 Total Non-Annual Fee Revenues 238,700 243,500 190,000190,000 Excess of Revenues Over Expenses / (Expenses Over Revenues) (1,490,400) (1,658,500) (3,907,600)
(2,903,800)
Full Time Equivalent
-
-
Office of Treasurer
Salaries and Benefits
54,100
55,200
100,700
99,700
Operating Expenses
5,800
5,900
20,900
20,900
Program
Expenses
383,000
390,700
480,800
480,800
Total Expenses
442,900
451,800
602,400
601,400
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
442,900)
(
451,800)
(
602,400)
(
601,400)
Full Time Equivalent
1.0 1.0 Policy | Equity InitiativesSalaries and Benefits 1,984,000 2,023,700 2,394,600 2,035,500 Operating Expenses 100,900 102,900 105,900 105,900 Program Expenses 398,000 406,000 877,200 719,800 Total Expenses 2,482,900 2,532,600 3,377,700 2,861,200 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (2,482,900) (2,532,600) (3,377,700) (2,861,200)Full Time Equivalent 14.5 11.5 30
Slide31Support of Other Organizations
31
Slide32Overview
Support of Other Organizations
The 2020 budget
continues to include support for other organizations.Federation of Law Societies of CanadaCanadian Legal Information Institute (CanLII)LibraryCoThe national coordinating body of Canada’s 14 provincial and territorial law societiesThe Federation supports the development of national standards of regulationCanLII is a non-profit organization launched in 2001 by the Federation of Law Societies of Canada on behalf of its 14 member law societies to provide efficient and open online access to a comprehensive collection of current judicial decisions, legislative documents and secondary resourcesLibraryCo, a wholly-owned, not-for-profit subsidiary of the Law Society of Ontario, was established to develop policies, procedures, guidelines and standards for the delivery of legal information and library services across Ontario and to administer funding on behalf of the Society$11.4 million8.2%$10.5 million8.0%Annual Fees
Slide33Overview
Support of Other Organizations
The 2020 budget
continues to include support for other organizations.$11.4 million8.2%$10.5 million8.0%Pro Bono Ontario-Ontario Justice Education Network (OJEN)-Law Commission of OntarioFederation of Ontario Law Associations (FOLA)Pro Bono Ontario helps Ontarians who have essential legal needs but cannot afford a lawyerOJEN develops innovative educational tools that introduce young people to the justice system, help them understand the law, and build their legal capabilityThe Law Commission of Ontario is an independent organization that researches issues and recommends law reform measures to make the law accessible to all members of Ontario’s communities.FOLA is a non-profit organization that coordinates activities for county law associations Advocates for a better justice system that recognizes the crucial role competent and professional lawyers play in that system33
Slide34Operating Budget Summary
Support of Other Organizations
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved Budget% Change Presented / Prior Year ApprovedSupport of Other Organizations TotalSalaries and Benefits - - - - Operating Expenses 55,238 56,300 64,000 64,000 Program Expenses 11,055,544 11,276,700 11,502,700 11,368,900 Total Expenses 11,110,782 11,333,000 11,566,700 11,432,900
-1.2%
Total Non-Annual Fee Revenues
-
-
-
-
0.0%
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(11,110,782
)
(11,333,000
)
(
11,566,700)
(
11,432,900)
Full Time Equivalent
-
-
34
Slide35Operating Budget Details
Support of Other Organizations
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetFederation of Law Societies of CanadaSalaries and Benefits - - - - Operating Expenses - - - - Program Expenses 1,132,977 1,155,600 1,111,000 1,211,000 Total Expenses 1,132,977 1,155,600 1,111,000 1,211,000 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (1,132,977) (1,155,600) (1,111,000) (1,211,000)
Full Time Equivalent
-
-
Canadian Legal Information Institute (
CanLII
)
Salaries and Benefits
-
-
-
-
Operating Expenses
-
-
-
-
Program
Expenses
1,604,871
1,637,000
1,815,200
1,715,200
Total Expenses
1,604,871
1,637,000
1,815,200
1,715,200
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
1,604,871)
(
1,637,000)
(
1,815,200)
(1,715,200
)
Full Time Equivalent
- - LibraryCoSalaries and Benefits - - - - Operating Expenses - - - - Program Expenses 7,900,000 8,058,000 8,152,900 8,019,100 Total Expenses 7,900,000 8,058,000 8,152,900 8,019,100 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (7,900,000) (8,058,000) (8,152,900) (8,019,100)Full Time Equivalent - - 35
Slide36Operating Budget Details
Support of Other Organizations
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetPro Bono Ontario | Ontario Justice Education Network (OJEN) | Law Commission of OntarioSalaries and Benefits - - - - Operating Expenses - - - - Program Expenses 237,800 242,600 223,300 223,300 Total Expenses 237,800 242,600 223,300 223,300 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (237,800) (242,600) (223,300) (
223,300)
Full Time Equivalent
-
-
Federation of Ontario Law Associations (FOLA)
Salaries and Benefits
-
-
-
-
Operating Expenses
55,238
56,300
64,000
64,000
Program
Expenses
179,896
183,500
200,300
200,300
Total Expenses
235,134
239,800
264,300
264,300
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
235,134)
(
239,800)
(
264,300)
(
264,300)
Full Time Equivalent
- - 36
Slide37Professional Development & Competence
37
Slide38Overview
Professional Development & Competence
Professional Development and Competence
focuses on the competency and professional standards of the professions through the licensing processes, provision of legal information and supports, competence resources and education programs, and post-licensing quality assurance programs.Executive Director’s Office-Practice Supports & Resources-Practice ManagementLicensing Process-Certified SpecialistContinuing Professional DevelopmentResponds to requests for guidance from over 8,000 callers and supports over 130 practice management and professional responsibility resources including: Practice Management Guidelines, Practice Guides, checklists, articles, FAQs, and other toolsProvides “just in time” guidance and information to enable licensees and others to make informed decisions through the Practice Management HelplineManages support services through Coach and Advisor Network using a mentorship modelManages the licensing processes - standardized, fair, transparent and defensible systems of assessment for entry-level lawyers and paralegals Approximately 2,400 new registered lawyer candidates and 1,400 new registered paralegal candidates in the licensing process annuallyDevelops and delivers the Licensing Examinations and the Experiential Training Programs (Articling and the Law Practice Program/PPD)Approximately 2,200 lawyers and 1,300 paralegals are licensed each yearAccredits and audits college paralegal programsProvides professional credentialing through certifying specialization in designated practice areas Delivers educational programming for the legal professions on a wide variety of substantive and professionalism topics via live programs, and live and archived webcastCoordinates the development and presentation of approximately 140 programs per year$32.3 million23.2%$31.6 million24.2%38
Slide39Overview
Professional Development & Competence
Professional Development and Competence
focuses on the competency and professional standards of the professions through the licensing processes, provision of legal information and supports, competence resources and education programs, and post-licensing quality assurance programs.$32.3 million23.2%$31.6 million24.2%Practice Review-Spot Audit Practice AuditsGreat Library -Corporate Records & ArchivesConducts Spot Audits to assess a law firm’s compliance with the Law Society’s financial record keeping requirementsConducts Practice Management Reviews to assess an individual lawyer’s practice management activitiesConducts Entry to Practice Reviews for those licensees returning to practice after 5 or more yearsConducts Practice Audits of paralegal practices - a combined financial audit and practice management reviewSupports the research and information needs of the lawyer and paralegal professions through a significant print collection, and increasingly through electronic resources, and responds to over 20,000 legal research and information requests each yearAdministers AccessCLE, a full-text, searchable websiteShares information through its blog, Know HowManages the Law Society’s large and complex document collection, including the organization’s official corporate records and artifacts of historical significance to Ontario’s legal professions39
Slide40Operating Budget Summary
Professional Development & Competence
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved Budget% Change Presented / Prior Year ApprovedProfessional Development & Competence TotalSalaries and Benefits15,882,600 16,200,100 16,763,900 17,289,800 Operating Expenses 954,900 974,000 1,129,800 1,018,900 Program Expenses 12,568,800 13,242,000 14,700,800 14,026,600 Total Expenses 29,406,300 30,416,100 32,594,500 32,335,300 -0.8%Total Non-Annual Fee Revenues
22,588,600
23,040,400
22,880,500
23,196,300
1.4%
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
6,817,700)
(7,375,700
)
(
9,714,000)
(
9,139,000)
Full Time Equivalent
158.5
160.5
40
Items of Note
The increase in salaries and benefits relates to the addition of two FTEs for the Practice Management Helpline enhancements approved by Convocation in 2018.
The difference in the 2020 salaries and benefits over projected actuals for 2019 is affected by staffing vacancies in the Licensing Process, Practice Management and Practice Review departments and the additional positions for the Practice Management Helpline.
The change in the program expenses is mainly due to savings identified by management and the elimination of $570,000 budgeted in 2019 to support development of the family legal services provider licence with additional funding not needed in 2020.
Slide41Operating Budget Details
Professional Development & Competence
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetExecutive Director’s Office | Practice Supports & Resources | Practice ManagementSalaries and Benefits2,236,500 2,281,200 2,425,2002,612,200Operating Expenses121,800 124,200 126,900 126,900 Program Expenses68,300 69,700 205,100 267,100 Total Expenses 2,426,600 2,475,100 2,757,200 3,006,200 Total Non-Annual Fee Revenues 27,200 27,700 - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (2,399,400) (2,447,400) (2,757,200) (3,006,200)Full Time Equivalent
17.0
19.0
Licensing Process | Certified Specialist
Salaries and Benefits
3,235,700
3,300,400
3,573,800
3,729,500
Operating Expenses
152,500
155,600
175,600
159,900
Program
Expenses
9,155,800
9,650,000
10,304,100
9,989,300
Total Expenses
12,544,000
13,106,000
14,053,500
13,878,700
Total Non-Annual Fee Revenues
14,440,400
14,729,200
14,457,500
14,778,000
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
1,896,400
1,623,200
404,000
899,300
Full Time Equivalent
40.5
40.5
Continuing
Professional Development
Salaries and Benefits
2,388,700
2,436,500
2,500,900
2,533,400 Operating Expenses111,000 113,200 117,600 109,100 Program Expenses1,550,300 1,581,300 1,779,800 1,664,300 Total Expenses 4,050,000 4,131,000 4,398,300 4,306,800 Total Non-Annual Fee Revenues 7,921,400 8,079,800 8,251,000 8,251,000 Excess of Revenues Over Expenses / (Expenses Over Revenues) 3,871,400 3,948,800 3,852,700 3,944,200 Full Time Equivalent29.029.041
Slide42Operating Budget Details
Professional Development & Competence
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetPractice Review | Spot AuditSalaries and Benefits5,737,200 5,851,900 5,958,700 6,070,700 Operating Expenses469,500 478,900 571,300 504,300 Program Expenses37,300 38,000 38,800 38,800 Total Expenses6,244,000 6,368,800 6,568,800 6,613,800 Total Non-Annual Fee Revenues28,200 28,800 - - Excess of Revenues Over Expenses / (Expenses Over Revenues)(6,215,800) (6,340,000) (6,568,800) (6,613,800)
Full Time Equivalent
48.0
48.0
Practice Audits
Salaries and Benefits
472,200
481,600
502,000
546,800
Operating Expenses
51,600
52,600
59,900
59,900
Program
Expenses
2,900
3,000
23,500
2,700
Total Expenses
526,700
537,200
585,400
609,400
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
526,700)
(
537,200)
(
585,400)
(
609,400)
Full Time Equivalent
4.0 4.0 Great Library | Corporate Records & ArchivesSalaries and Benefits1,812,300 1,848,500 1,803,300 1,797,200 Operating Expenses48,500 49,500 78,500 58,800 Program Expenses1,754,200 1,900,000 2,349,500 2,064,400 Total Expenses 3,615,000 3,798,000 4,231,300 3,920,400 Total Non-Annual Fee Revenues171,400 174,800 172,000 167,300 Excess of Revenues Over Expenses / (Expenses Over Revenues)(3,443,600) (3,623,200)(4,059,300) (3,753,100)Full Time Equivalent20.020.042
Slide43Professional Regulation & Tribunal
43
Slide44Overview
Professional Regulation & Tribunal
Professional
Regulation responds to regulatory issues brought to the Law Society’s attention by resolving and investigating matters, and representing the Law Society in hearings before the Law Society Tribunal. Primary activities of Professional Regulation include complaints handling, investigations, discipline prosecutions, monitoring and enforcement of orders and undertakings, trusteeships, and client compensation. Executive Director’s Office -Case ManagementComplaints Intake & Resolution Regulatory Compliance - By-Law Administration Services Investigation ServicesOversees the case management system and the Integrated Regulatory Information System ("IRIS")Monitors quality of case filesDevelops qualitative analysis and recommendations regarding file handling, issue management, work process and procedural improvementsDevelops reporting structures and the examination and evaluation of reporting requirements Receives, logs, and acknowledges complaints related correspondence, assessing whether a written complaint is within Law Society jurisdictionResolves less serious allegations transferring serious allegations to Investigation ServicesComplaints Resolution Commissioner conducts an impartial review of an investigation to close the file, often meeting with the complainant to discuss the matterAdministers by-law driven processes, including annual reporting; enforces, suspension orders and revocationsCommunicates practice restrictions, discipline histories and other regulatory information internally and to the publicInvestigates serious allegations of licensee misconduct, incapacity and incompetenceInvestigates issues relating to the good character of licensee applicants and the unauthorized practice by non-licenseesResolves and closes file, refers the matter to the Proceedings Authorization Committee (PAC) or transfers file to Litigation Services$44.5 million31.9%$41.1 million31.4%44
Slide45Overview
Professional Regulation & Tribunal
Professional
Regulation responds to regulatory issues brought to the Law Society’s attention by resolving and investigating matters, and representing the Law Society in hearings before the Law Society Tribunal. Primary activities of Professional Regulation include complaints handling, investigations, discipline prosecutions, monitoring and enforcement of orders and undertakings, trusteeships, and client compensation. $44.5 million31.9%$41.1 million31.4%Litigation ServicesTrustee ServicesCompensation FundsLaw Society TribunalProvides advice to investigators on investigation filesPrepares memoranda for the Proceedings Authorization Committee on recommendations for a hearingRepresents the Law Society before the Law Society Tribunal and before the courtsEnsures the protection of client funds, files and property, when a licensee is no longer able to continue operating his or her professional business due to death, incapacity, abandonment of practice or revocation Obtains a court order appointing the Law Society as trustee of the practiceProvides information services to assist with a practice wind-upProcesses claims by clients who have lost money as a result of the dishonesty of a licenseeThe current maximum amounts payable to a claimant in respect of lawyer or paralegal dishonesty are $500,000 and $10,000, respectivelyProcesses, hears and decides regulatory cases about Ontario lawyers and paralegals in a manner that is fair, just and in the public interest45
Slide46Operating Budget Summary
Professional Regulation
& Tribunal
2018 Actuals2019 Projected Actuals2019 Approved Budget2020 Approved Budget% Change Presented / Prior Year ApprovedProfessional Regulation & Tribunal TotalSalaries and Benefits 24,622,600 25,115,100 28,553,900 28,528,900 Operating Expenses 1,655,400 1,829,175 2,010,500 2,121,900 Program Expenses 5,986,800 6,886,400 14,579,700 13,869,800 Total Expenses 32,264,800 33,830,675 45,144,100 44,520,600 -1.4%
Total Non-Annual Fee Revenues
612,400
2,415,200
2,305,500
2,305,500
0.0%
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(31,652,400)
(31,415,475)
(
42,838,600)
(42,215,100
)
Full Time Equivalent
231.5
229.0
46
Items
of Note
The variance between the 2020 salaries and benefits and the 2019 projected actuals is
related
to significant staffing vacancies. Active recruitment is in progress and the budget is maintained in anticipation of full staffing. These vacancies are primarily in the Investigation Services and Litigation Services departments.
The increase in operating expenses relates to anticipated costs for scanning and digitization of regulatory process files.
The change in program expenses is due to savings identified by management related to the Executive Director’s Office and in Tribunal.
The
difference in the 2020 program expense budget over projected actuals for 2019 relates to favourable lawyer compensation fund
routine grant
experience compared to budget and the $5 million provision to replenish the fund balance. A three-year plan was initiated in 2018 to replenish the fund balance by including an annual $5 million provision above the amount for routine claims. The plan is on target to achieve its replenishment objective in 2020.
Slide47Operating Budget Details
Professional Regulation
& Tribunal
2018 Actuals2019 Projected Actuals2019 Approved Budget2020 Approved BudgetExecutive Director’s Office | Case Management Salaries and Benefits 2,043,300 2,084,200 3,307,200 2,390,500 Operating Expenses 157,300 187,400 310,500 295,500 Program Expenses 1,850,800 1,887,800 2,680,600 2,312,900 Total Expenses 4,051,400 4,159,400 6,298,300 4,998,900 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (4,051,400) (4,159,400) (6,298,300) (4,998,900)
Full Time Equivalent
23.0
15.5
Complaints Intake & Resolution
Salaries and Benefits
5,091,500
5,193,300
4,857,500
5,342,700
Operating Expenses
176,200
215,675
263,400
269,000
Program
Expenses
157,100
160,200
239,700
176,600
Total Expenses
5,424,800
5,569,175
5,360,600
5,788,300
Total Non-Annual Fee Revenues
285,600
291,300
179,900
179,900
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
5,139,200)
(5,277,875)
(
5,180,700)
(5,608,400)Full Time Equivalent 45.0 48.5 Regulatory Compliance | By-Law Administration Services Salaries and Benefits 1,717,500 1,751,900 1,896,300 1,780,700 Operating Expenses 117,500 119,900 167,400 129,900 Program Expenses 21,200 21,600 50,500 50,000 Total Expenses 1,856,200 1,893,400 2,114,200 1,960,600 Total Non-Annual Fee Revenues 788,400 804,200 700,000 700,000 Excess of Revenues Over Expenses / (Expenses Over Revenues) (1,067,800) (1,089,200) (1,414,200) (1,260,600)Full Time Equivalent 20.0 19.5 47
Slide48Operating Budget Details
Professional Regulation
& Tribunal
2018 Actuals2019 Projected Actuals2019 Approved Budget2020 Approved BudgetInvestigation ServicesSalaries and Benefits 7,703,500 7,857,600 8,632,900 8,915,600 Operating Expenses 725,300 810,000 678,400 814,400 Program Expenses 388,300 396,100 296,700 292,700 Total Expenses 8,817,100 9,063,700 9,608,000 10,022,700 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (8,817,100) (9,063,700) (9,608,000) (10,022,700)
Full Time Equivalent
70.5
72.5
Litigation
Services
Salaries and Benefits
4,901,100
4,999,100
6,393,800
6,538,300
Operating Expenses
314,600
320,900
403,600
418,600
Program
Expenses
187,000
190,700
139,300
152,900
Total Expenses
5,402,700
5,510,700
6,936,700
7,109,800
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
5,402,700)
(
5,510,700)
(
6,936,700)
(7,109,800)Full Time Equivalent 41.0 41.0 Trustee ServicesSalaries and Benefits 1,412,500 1,440,800 1,476,300 1,483,400 Operating Expenses 57,200 58,300 54,500 58,500 Program Expenses 74,300 100,000 152,600 118,900 Total Expenses 1,544,000 1,599,100 1,683,400 1,660,800 Total Non-Annual Fee Revenues3,000 3,100 100,600 100,600 Excess of Revenues Over Expenses / (Expenses Over Revenues) (1,541,000) (1,596,000) (1,582,800) (1,560,200)Full Time Equivalent 14.0
14.0
48
Slide49Operating Budget Details
Professional Regulation
& Tribunal
2018 Actuals2019 Projected Actuals2019 Approved Budget2020 Approved BudgetCompensation FundsSalaries and Benefits 480,900 490,500 555,500 616,200 Operating Expenses 11,200 19,000 25,700 29,000 Program Expenses 2,812,300 3,500,000 10,137,100 10,073,600 Total Expenses 3,304,400 4,009,500 10,718,300 10,718,800 Total Non-Annual Fee Revenues(464,600)1,316,600 1,325,000 1,325,000 Excess of Revenues Over Expenses / (Expenses Over Revenues)(3,769,000) (2,692,900)(9,393,300) (
9,393,800)
Full Time Equivalent
5.0
5.0
Law
Society Tribunal
Salaries and Benefits
1,272,300
1,297,700
1,434,400
1,461,500
Operating Expenses
96,100
98,000
107,000
107,000
Program
Expenses
495,800
630,000
883,200
692,200
Total Expenses
1,864,200
2,025,700
2,424,600
2,260,700
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
1,864,200)
(2,025,700
)
(
2,424,600)
(
2,260,700)Full Time Equivalent 13.0 13.0 49
Slide50Client & People Services
50
Slide51Overview
Client & People Services
Client & People Services division is a collection of business
units, including Human Resources, Corporate Resource & Training Centre, Client Service Centre, Catering and Events that offer a diverse range of services to internal and external stakeholders.Executive Director’s Office-Human Resources - Corporate Resource & Training CentreClient Service CentreCatering- EventsPartners strategically with business units to recruit, develop and retain a high performing and diverse workforceOffers advice, consulting and support to enhance personal and organizational effectivenessDevelops organization-wide training on matters of operational improvement and ongoing talent managementReceives over 160,000 calls to Resource Centre, Complaints Reception and Main Reception lines and receives over 15,000 e-mails to the Law Society inboxUpdates licensee information and maintains most of the contact related database changesProduces licensee and staff Law Society photo ID cards, Certificates of Standing, Status Letters, and Adjusted Billings for licensees whose status have changed during the yearConnects people looking for legal assistance with a lawyer or paralegal who will provide a free consultation of up to 30 minutes to help determine rights and optionsProvides food services for internal and external meetings and events, manages the Osgoode Hall Restaurant, and assists in preparation of meals for the Toronto Lawyers Feed the Hungry ProgramWorks closely with Facilities to manage internal and external room bookings and provides maintenance of the spaces$11.5 million8.2%$10.7 million8.2%51
Slide52Overview
Client & People Services
Client & People Services division is a collection of
business units, including Human Resources, Corporate Resource & Training Centre, Client Service Centre, Catering and Events that offer a diverse range of services to internal and external stakeholders.$11.5 million8.2%$10.7 million8.2%Member Assistance Plan (MAP)Parental Leave Assistance Plan (PLAP)A confidential service designed to help members to achieve their health and wellness goalsLawyers, paralegals, licensing candidates, law students, judges, other legal professionals and their families can access the MAP Funded by and fully independent of the Law Society of Ontario and LAWPRO, Homewood Health provides services through coaching, counselling, peer support and resourcesFinancial assistance following the birth or adoption of a child – $750 per week for up to 12 weeks ($9,000 max. per family)For practising lawyers (women and men) in sole practice, or firms of up to five lawyers, who do not have access to other parental or adoption benefits52
Slide53Operating Budget Summary
Client & People Services
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved Budget% Change Presented / Prior Year ApprovedClient & People Services TotalSalaries and Benefits 7,277,200 7,422,700 7,647,100 7,715,800 Operating Expenses 319,600 326,000 500,600 489,300 Program Expenses 2,908,200 2,966,400 3,233,800 3,247,300 Total Expenses 10,505,000 10,715,100 11,381,500 11,452,400 0.6%
Total Non-Annual Fee Revenues
2,490,000
2,539,800
2,572,700
2,572,700
0.0%
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(8,015,000)
(8,175,300)
(
8,808,800)
(8,879,700
)
Full Time Equivalent
82.0
81.0
53
Items
of Note
The variance in 2020 salaries and benefits expense compared to 2019 projected actuals relates to staffing vacancies
.
Slide54Operating Budget Details
Client & People Services
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetExecutive Director’s Office | Human Resources | Corporate Resource & Training CentreSalaries and Benefits 2,615,900 2,668,200 2,672,200 2,650,200 Operating Expenses 150,500 153,500 243,400 242,100 Program Expenses 1,374,600 1,402,100 1,730,000 1,580,500 Total Expenses 4,141,000 4,223,800 4,645,600 4,472,800 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (4,141,000) (4,223,800) (4,645,600)
(
4,472,800)
Full Time Equivalent
21.0
20.0
Client Service Centre
Salaries and Benefits
3,192,500
3,256,400
3,473,000
3,484,100
Operating Expenses
118,900
121,300
205,300
195,300
Program
Expenses
21,600
22,000
53,900
18,900
Total Expenses
3,333,000
3,399,700
3,732,200
3,698,300
Total Non-Annual Fee Revenues
479,900
489,500
427,700
427,700
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
2,853,100)
(
2,910,200)
(3,304,500) (3,270,600)Full Time Equivalent 41.0 41.0 Catering | EventsSalaries and Benefits 1,468,800 1,498,200 1,501,900 1,581,500 Operating Expenses 50,200 51,200 51,900 51,900 Program Expenses 759,200 774,400 824,700 822,700 Total Expenses 2,278,200 2,323,800 2,378,500 2,456,100 Total Non-Annual Fee Revenues 1,741,400 1,776,200 1,910,000 1,910,000 Excess of Revenues Over Expenses / (Expenses Over Revenues) (536,800) (547,600) (468,500)
(
546,100)
Full Time Equivalent
20.0
20.0
54
Slide55Operating Budget Details
Client & People Services
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetMember Assistance Plan (MAP)Salaries and Benefits - - - - Operating Expenses - - - - Program Expenses 597,800 609,800 525,200 625,200 Total Expenses 597,800 609,800 525,200 625,200 Total Non-Annual Fee Revenues 268,700 274,100 235,000
235,000
Excess of Revenues Over Expenses /
(Expenses Over Revenues)
(329,100
)
(335,700)
(
290,200)
(
3
90,200
)
Full Time Equivalent
-
-
Parental Leave Assistance Plan (PLAP)
Salaries and Benefits
-
-
-
-
Operating Expenses
-
-
-
-
Program
Expenses
155,000
158,100
100,000
200,000
Total Expenses
155,000
158,100
100,000
200,000
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses Over Revenues) (155,000) (158,100) (100,000) (200,000)Full Time Equivalent - - 55
Slide56Administration
56
Slide57Overview
Administration
The Society’s administrative functions include executive oversight, financial administration, information systems, office of general counsel and facilities management.
Office of Chief Executive OfficerFinanceInformation TechnologyExternal Relations & CommunicationsLeads the operations of the Law SocietyProvides advice and support to the Treasurer and benchers and operational oversight for projects and activities that bridge strategy, policy and large-scale implementationThe office includes the Corporate Secretary function with oversight and management of governance functionsCoordinates the contribution of benchers and management to Federation of Law Societies of Canada Oversees the Society’s financial administration including its annual budget, financial policies and reporting, internal controls and support for the Audit and Finance CommitteeManages the Society’s enterprise risk management including risk identification, assessment and mitigation and compliance reportingProvides Financial administration to the Law Society Foundation and LibraryCo Inc.Supports business applications and information and communications technology that enables the Law Society to operate efficiently and effectivelyManages IT related projects and initiatives for the Law SocietyCoordinates the Society’s communications, government and stakeholder relations functionsProvides strategic communications and engagement advice and servicesWorks closely with the Treasurer, benchers, management and operational areas to advance policy initiatives and strategic priorities by taking a leadership role in engagement and communications strategy development, media relations and issues management$28.6 million20.5%$26.0 million19.9%57
Slide58Overview
Administration
The Society’s administrative functions include executive oversight, financial administration, information systems, office of general counsel and facilities management.
$28.6 million20.5%$26.0 million19.9%FacilitiesOffice of General CounselCorporateDelivers integrated services to create and maintain adaptable and optimal spaces that are safe, sustainable and promote positive work environmentsManages capital projects lifecycle renewal for the Law SocietyProvides oversight for all corporate litigationSupports and co-instructs external counsel appointed by the Law Society’s insurers in respect of litigation that is insuredManages an average of 30 corporate litigation files each yearProvides a variety of legal services to the organization, ranging from advice and opinions on emerging policy matters through to legal implications of implementation of programs and policies including employment law and other organization obligationsIncludes expenses not aligned specifically with an operational department including insurance, audit fees, provision for bad debts, payment card processing fees and the central operations contingency.58
Slide59Operating Budget Summary
Administration
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved Budget% Change Presented / Prior Year ApprovedAdministration TotalSalaries and Benefits 13,644,900 13,917,800 14,501,000 14,813,700 Operating Expenses 511,500 521,700 710,600 697,600 Program Expenses 12,878,700 13,341,500 14,109,700 13,043,500 Total Expenses 27,035,100 27,781,000 29,321,300 28,554,800 -2.6%
Total Non-Annual Fee Revenues
4,791,100
4,886,900
5,085,500
5,157,500
1.4%
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(22,244,000)
(22,894,100
)
(24,235,800
)
(23,397,300
)
Full Time Equivalent
127.5
125.5
59
Items
of Note
The increase in salaries and benefits when compared to the 2019 approved budget is attributable to
market adjustments in
the Security department
offset by a
reduction of two FTEs in the External Relations and Communications division.
The variance in the 2020 salaries and benefits in comparison to the 2019 projected actuals is due to staffing vacancies.
The change in the program expenses is
due
to savings identified by management and the removal of funding for the Awareness Campaign’s media buy of $600,000 pending a decision by Convocation to continue.
Slide60Operating Budget Details
Administration
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetOffice of Chief Executive OfficerSalaries and Benefits 1,280,000 1,305,600 1,317,300 1,335,600 Operating Expenses 76,300 77,800 78,600 78,600 Program Expenses 355,700 362,800 295,700 244,500 Total Expenses 1,712,000 1,746,200 1,691,600 1,658,700 Total Non-Annual Fee Revenues - - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (1,712,000) (1,746,200) (1,691,600) (1,658,700)
Full Time Equivalent
5.0
5.0
Finance
Salaries and Benefits
2,826,100
2,882,600
2,998,500
3,063,200
Operating Expenses
91,500
93,300
161,500
146,500
Program
Expenses
149,200
152,200
318,500
288,500
Total Expenses
3,066,800
3,128,100
3,478,500
3,498,200
Total Non-Annual Fee Revenues
552,000
563,000
473,000
473,000
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(2,514,800
)
(2,565,100
)
(
3,005,500)
(3,025,200)Full Time Equivalent 25.0 25.0 Information TechnologySalaries and Benefits 4,540,500 4,631,300 4,831,200 4,914,100 Operating Expenses 108,400 110,600 126,400 126,400 Program Expenses 1,759,700 2,000,000 2,200,200 2,125,200 Total Expenses 6,408,600 6,741,900 7,157,800 7,165,700 Total Non-Annual Fee Revenues 12,000 12,200 12,000 12,000 Excess of Revenues Over Expenses / (Expenses Over Revenues) (6,396,600) (6,729,700) (7,145,800) (7,153,700)Full Time Equivalent 43.0 43.0 60
Slide61Operating Budget Details
Administration
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetExternal Relations & CommunicationsSalaries and Benefits 1,763,500 1,798,800 1,949,000 1,865,600 Operating Expenses 100,100 102,100 180,800 180,800 Program Expenses 1,766,300 1,801,600 2,339,100 1,519,100 Total Expenses 3,629,900 3,702,500 4,468,900 3,565,500 Total Non-Annual Fee Revenues 60,400 61,600 120,000 120,000 Excess of Revenues Over Expenses / (Expenses Over Revenues) (3,569,500) (3,640,900) (4,348,900)
(3,445,500
)
Full Time Equivalent
18.0
16.0
Facilities
Salaries and Benefits
1,969,500
2,008,900
2,088,400
2,230,300
Operating Expenses
57,800
59,000
77,200
79,200
Program
Expenses
4,768,200
4,863,600
5,175,700
5,285,700
Total Expenses
6,795,500
6,931,500
7,341,300
7,595,200
Total Non-Annual Fee Revenues
-
-
-
-
Excess of Revenues Over Expenses /
(Expenses
Over Revenues)
(
6,795,500)
(
6,931,500)
(
7,341,300)
(7,595,200)Full Time Equivalent 28.0 28.0 Office of General CounselSalaries and Benefits 1,265,300 1,290,600 1,316,600 1,404,900 Operating Expenses 77,400 78,900 86,100 86,100 Program Expenses 188,600 192,400 448,400 248,400 Total Expenses 1,531,300 1,561,900 1,851,100 1,739,400 Total Non-Annual Fee Revenues 250,000 - - - Excess of Revenues Over Expenses / (Expenses Over Revenues) (1,281,300) (1,561,900) (1,851,100) (1,739,400)Full Time Equivalent 8.5
8.5
61
Slide62Operating Budget Details
Administration
2018 Actuals
2019 Projected Actuals2019 Approved Budget2020 Approved BudgetCorporateSalaries and Benefits - - - - Operating Expenses-- - - Program Expenses 3,891,000 3,968,900 3,332,100 3,332,100 Total Expenses 3,891,000 3,968,900 3,332,100 3,332,100 Total Non-Annual Fee Revenues 3,916,700 3,995,000 4,480,500 4,552,500 Excess of Revenues Over Expenses / (Expenses Over Revenues) 25,700 26,100
1,148,400
1,220,400
Full Time Equivalent
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-
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Slide63Other Funds
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Slide64Compensation Funds
The Compensation Funds are restricted by the Law Society Act. Under the Act, the Funds’ revenues are to include licensee annual fees, recoveries and investment income from the investment of the accumulated fund balances
.
The Funds make grants to members of the public who are the victims of licensee dishonesty and misappropriation of client funds held in trust. Convocation has delegated responsibility for the approval of grants to the Compensation Fund Committee. Current guidelines for grants cap payments at $500,000 for the lawyer fund and $10,000 for the paralegal fund.The lawyer fund is governed by a Convocation approved fund balance management policy. The policy sets out minimum and maximum fund balance amounts to be maintained and prescribes the use of the accumulated fund balance and steps to be taken in the event the fund balance is below the policy minimum. Currently, the minimum balance to be maintained in the lawyer fund is approximately $20.5 million. A key element of the fund balance management policy is the use of actuarial estimates to predict future claims activity and the appropriate size of the fund balance. This review is undertaken every three years with the next scheduled review in 2020.64
Slide65Compensation Funds
The
P
aralegal Fund, due to its relatively short existence, operational since 2008, is not governed by a fund management policy. However, its current balance of $800,000 is two and one half times the total grants paid from the fund since inception. The fund is in a very strong position and would be able to absorb a major defalcation if one were to occur.65Compensation Fund SummaryLawyersParalegalsTotalProgram expenses 104,700 13,300 118,000 Provision for grants4,840,000 115,600 4,955,600 Fund balance replenishment5,000,000 - 5,000,000 Toal program expenses9,944,700 128,900 10,073,600 Salaries and administration572,600 72,600 645,200 Total expenses10,517,300 201,500 10,718,800
Slide66Capital Fund
The Law Society maintains a Capital Fund for the purpose of providing funding for the replacement, upgrade and restoration of its physical assets and information technology systems. Annual fees, currently $91 per licensee, are reported in the Fund as revenue, and expenditures on approved projects are made from the Fund.
The Society is undergoing an assessment of the useful life of its physical plant to develop a ten year plan for the upkeep and eventual replacement of relevant equipment. An assessment of the Society’s information technology needs will be undertaken to identify and prioritize systems in need of upgrade or replacement.
On completion of these studies, a plan for capital expenditures will be brought forward to Convocation for consideration and approval. These studies will inform future capital expenditure plans. A comprehensive multi-year plan will be presented as part of the 2021 budget process.66
Slide67County Libraries Fund
The Society maintains the County
Libraries
Fund to collect fees from lawyers for the provision of legal information and the support of county library services across Ontario’s law libraries through its wholly-owned not-for-profit subsidiary LibraryCo. On an annual basis the Society approves a budget submission from LibraryCo and levies lawyers their proportionate share based on the estimated number of full fee equivalent lawyers in the upcoming year. The revenue raised from the annual fee is reported as revenue of the Fund, and payments made to LibraryCo are reported as an expense of the Fund. For 2020, the amount to be paid to LibraryCo is $8,019,000.To the extent that levies raised exceed payments to LibraryCo, the difference is maintained in the County Libraries Fund fund balance. This balance is available to mitigate future annual fees raised for the purpose of funding LibraryCo. The balance in the Fund at the end of 2018 was $131,000.67
Slide68Errors and Omissions Insurance Fund
The Society’s Errors and Omissions Insurance Fund (E&O Fund) is maintained for the purpose of reporting insurance related transactions between the Society, lawyers and LAWPRO. LAWPRO administers the day to day operations of the E&O Fund under a management services agreement with the Society at no cost.
The Fund’s surplus funds are managed by the Society’s investment manager under a Convocation approved investment policy. The Fund has no active claims outstanding and investment income surplus to the needs of the Fund is available for the use of the Society’s general operations. The 2020 budget proposes utilizing $1.2 million of investment income from the E&O Fund to mitigate the 2020 lawyer annual fee.
The Fund reports the Society’s investment in LAWPRO of $35.6 million at cost.68