Financial Management in the
Government of Canada
Edmonton and Vancouver FMI Chapters
October 29 and 30, 2013
Sharon Smith, Director, Internal Controls and Financial Policy
Financial Management Sector
Office of the Comptroller General,
Agenda
• Current environment
• Financial Policy initiatives
• Financial Management Community initiatives
• Career management
2
Current Environment
3
The Financial Management Environment
237.1 B revenues
369,000 FTEs
>1 M payments per working day
5 DFMS* in use
88.2% expenditures managed
through SAP*
132 Departments & Agencies
90% FTEs in departments
using SAP*
239.6 B expenses
Sources of Data:
* With HRSDC as an SAP user
2010-2011 Public Accounts
2012-2013 Departmental RPPs
Association of Canadian Financial Officers
Administrative Systems Inventory 2011-2012
4
Return to Balanced Budgets
• Canada expects a full recovery from the 2006 Financial Crisis by
2014/2015
Source: http://www.budget.gc.ca/2012/plan/chap1-eng.html#a10
5
Canada’s Fiscal Outlook
• Projected total government net debt, 2016
Source: http://www.budget.gc.ca/2012/plan/chap6-eng.html
6
Current Environmental Context
• Economic recovery and balanced budget;
• Cost containment and SFT Operating Budget freeze;
• Back Office efficiencies and service consolidation;
• Meeting expectations of Parliamentarians; and
• Supporting ministerial and enterprise-level decision-making.
7
Financial Management Transformation
Key Messages for Today
• Inclusive and sound governance for Financial Management
Transformation (FMT) is in place
• FMT Program will leverage existing work and best practices
• Approach: Financial management systems first, then financial
management services
• New CIOB IT direction = Application Management Services (AMS) will be
outsourced
• FMT now includes Grants & Contributions
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FMT - Transformation Approach
• Timely, agile and responsive data.
• Streamlined, and automated processes.
• Consolidated systems platforms.
• Leverage foundation to accelerate
standardization and consolidation.
• Rigorous investment plan and
performance measurement.
• Harvest and re-use solutions (e.g. ESDC), and support initiatives building
core capability.
• Assess alignment: continue, re-vector and halt on-going initiatives as
appropriate. Initiate transparent performance measurement.
• Continue to tighten policy requirements for process and information.
• Increasing momentum towards standardization (FM-BP, CEDI, FM-SC); progress is hampered by
decentralized current-state model.
• Redundant investments in process and system changes continue; operational support costs
remain high.
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FMT- Increased Value-for-Money
•
Streamline and automate routine transactions; integrate information
and processes across functional boundaries
•
Redirect resources to higher value services
•
Increase overall value provided to the business
Current-State
Value-added,
business
partner
services
Decision Support
Target-Model
Potential Savings
Control
Decision Support
Reporting
Control
Transaction
Processing
Routine,
process
oriented
services
Departmental
Financial Management
Systems
Reporting
Transaction
Processing
GC Enterprise
SAP
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FMT - Next Steps
• Fall 2013 – Complete the FMT business case (for funding)
• Fall 2013/Winter 2014 – Accumulate high level business
requirements, not detailed business processes like we previously did.
• February 2014 (Est.) – Present to Board of Management and COGA
• Summer/Fall 2014 – Work with departments to confirm potential
convergence date, develop ‘readiness’ workplan.
• April 2014 (Est.) – Build CC SAP configuration for less complex
organizations
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Financial Management Policy
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FM Policy Context
• 5 year review of FM policy suite
–
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Effective stewardship of the public purse
Reliable financial reporting
Underpins FAA and regulations
Roles and responsibilities
Current risk environment
• Alignment with transformative initiatives
13
Financial Management Policy Suite
 Responded to Federal Accountability Action Plan to review full FM suite
 Support deputy head responsibilities and expectations as accounting officers
 Maintaining Canada’s position among leading jurisdictions
•
The Treasury Board Financial Management Policy Framework articulated around four key
policies:
 Policy on Financial Management Governance (effective April 2009)
 Policy on Internal control (effective April 2009)
 Policy on Stewardship of Financial Management Systems (effective January 2010)
 Policy on Financial Resource Management, Information and Reporting (effective June
2010)

± 25 Directives

± Standards (e.g. TBAS)
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Policy on Internal Control
•
Reaffirms the responsibility of Deputy Heads, as accounting officers, for ensuring
the maintenance of effective risk-based systems of internal control
•
With a focus on internal controls over financial reporting requires that Deputy Heads:
– ensure the completion of an annual risk-based assessment of the
departmental system of internal control over financial reporting (ICFR)
– ensure the establishment of an action plan to address any necessary
adjustments
– include a summary of the assessment results and action plan to be
attached as an Annex to a revised Statement of Management
Responsibility accompanying the annual financial statements and signed
by the DH and the Chief Financial Officer (CFO)
– engage the Departmental Audit Committee or equivalent as appropriate on
assessment plans and associated results
15
Levels of departmental internal controls
DH as accounting officer
Broad system of internal control
System of IC
ADMs
CFO
System of
ICFM
System of internal control in
their area of responsibility
System of internal control over
financial management
System of
ICFR
Policy requirements focus
on ICFR
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Annual risk-based assessment approach
Financial Statements
Start with annual financial statements - Identify key accounts - key risks and materiality
 Set scope and develop assessment plan
Testing
3 levels of controls
 Design effectiveness:
– key controls documented
– in place as designed
– aligned with risks
Entity level (tone from
the top)
General IT level
 Operational effectivenesss:
– key controls functioning over time
Business process
level
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Directive on Travel, Hospitality, Conference
and Event Expenditures
• New focus on « events » October 3, 2012
• Travel
–
–
–
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Previous Budget caps
Deficit reduction
Political expectations
New travel approval requirements August 1, 2013
• Challenges
–
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Maximizing travel flexibilities
Data capture and system complexities
Linking costs (travel, hospitality and conference) to « event » approvals
Administrative burden
Training exclusions
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Pay Modernization
• Pay Consolidation
–
–
–
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Consolidation of PWGSC pay services in Mirimachi
3 waves of phased implementation (57 departments currently on board)
Key issues in section 34 pay verification – functions moved to pay centre
Departments must delegate authority for specific pay verification functions
• Pay in Arears (PIA)
–
–
–
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New COTS Pay System for fall 2015
New staff hired on or after March 27 2014 on PIA
Existing staff to have « transition payment »
Financial authority for this payment
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Other Policy Initiatives
• Interdepartmental Settlements
• Interdepartmental Charging
• Tax Regime Changes
• Payment on Due Date
• Transfer Payment Policy
– Performance report on Gs & Cs reforms under development
– Final report expected to be released Winter 2014
20
CFO Attestation
• CFOs will now provide evidence of their due diligence on Cabinet
submissions through a formal CFO attestation letter
• CFO’s attestation letter to be attached to TB Submission and summarized
in MCs Due Diligence section
–
The attestation letter include the following six assertions with evaluation criteria and
observations:
• Assumptions with financial implications are documented/reasonable;
• Significant risks with financial implications are identified and considered;
• Financial resource requirements are disclosed;
• Funding is identified and sufficient to address financial requirements;
• Proposal is compliant with financial legislation and policies; and
• Key financial controls and reporting are in place.
• CFO provides explicit conclusion on the sufficiency of the financial
information for decision-making
• New guidelines embody the CFO model
21
Costing Centre of Expertise
• New Costing Centre of Expertise (CCE) within OCG to supportDeputy
Head and CFO accountabilities
• Development of key costing guidance continues
– Costing for major capital asset acquisition
– Baseline cost of programs
– Revisiting the Guide to Costing
• TBS challenge function
– Support departments in producing high-quality costs estimates
– TBS capacity to challenge cost estimates
– PCO to do challenge function on MCs
22
Financial officer community
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Accounting Profession –
CA-CMA-CGA Unification
• The unification initiative is progressing quickly at the national and
provincial levels.
• A three-way unification completed in Quebec.
• Proposals between CAs and Certified Management Accountants (CMAs)
reached in many provinces except:
– Alberta, where CMAs are poised to unify with the Certified General
Accountants (CGAs); and
– Ontario, where only the ICAO is supporting joining CPA Canada.
24
Canadian CPA Certification Program
• Program Design
• CPA Competencies
• Program Details
• Education
• Examinations
• Practical experience
• Transition
25
CPA Impact on Recruiting and
Development in the Government of
Canada
• OCG is actively following the merger discussions.
• OCG will be reviewing the implications of the CPA merger and professional
program on the financial officer community and the current recruitment and
development programs.
• Financial Officer Recruiting and Development Program
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Financial Officer Training
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Financial Officer Training–
FI to CFO Career Path
• Developed by the DCFO Council to help Financial officers and financial
executives map out their career objectives and goals against predetermined criteria
– Focus is on reaching a CFO position but can also be used for other
specialized career paths within finance
– Works on two dimensions: the number of levels before obtaining a CFO
position and the specific requirements of each of these levels.
• OCG has worked with the FM community to revitalize the FI to CFO
Career Path (two distinct paths that interconnect). Will take into
consideration requirements of CFO Talent Management Initiative.
• New career path includes a “Welcome to the FM Community” page for
each FI level in the career path and is housed on FM community
GCPedia page
28
Financial Officer Training –
FI Competencies
• Benefits to using competencies:
Employer’s Perspective
Employee’s Perspective
• Greater insight into breadth and depth
of individual’s experience
• Career management and progression.
• Can substantiate information provided
by individual through validation
• More pointed and pertinent
discussions regarding employee’s
professional development
requirements
• Better understanding and verbalization
of accomplishments and experience
• Can substantiate work experience with
concrete work examples
• More pertinent feedback from
manager/mentor on areas of
professional development
• Helps determine the “right fit”
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Financial Officer Training –
FI Competencies
• FI Competency profiles
– Behavioural (includes the 7 key leadership competencies)
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Oral and written communications
Risk Management
Negotiation
Values and Ethics
Strategic Thinking: Analysis and Ideas
Engagement
Management Excellence: Action, People, Finance
– Functional (based on four FM functional areas)
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accounting and reporting
planning and resource management
Financial policy,
Financial Systems
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Financial Officer Training –
FI Competencies
• The FI Competency Profiles and the Employee guide on Competencybased Management have been approved by the Comptroller General
• An Employee and Manager’s guide on Competency-based Management
have been developed.
• All competency documents will be posted on the FM community
GCpedia site
• Training has been provided and is available in webinar format on the
FMI website.
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Financial Officer Training –
FI Core Curriculum
• 2013-2014 new activities:
– Costing in Government courses:
• Introduction to Costing in Government to be piloted on October 31, 2013; and
• The Application of Costing in Government to be piloted on November 28-29, 2013
(Both courses will be available during winter of 2014)
– Business Analysis course – to be piloted on November 18-20, 2013 (Course
available in September 2014)
– The Application of Revenue and Revenue Spending course: to be piloted on
January 30-31, 2014 (course available in September 2014)
– Integrated Risk Management course to be piloted on January 27, 2014
(course available in September 2014)
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CFO Talent Management
• Pilot courses with academia underway
– Senior financial officers
– Financial executives
• Institute of Governance’s initial financial executive boot camp
conducted (September 2013)
• “Next Gen” CFO course to be piloted in November 2014
– Partnering with Deloitte & Touche
• OCG to ‘evaluate’ pilot progress to determine next steps (Winter 2014)
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Career Management
35
Staffing Process
Poster & SoMC (Publiservice)
Application
(application form, covering letter, resumé, other documents)
Part 1
Part 2
Screening
Preparation (should start at time of application)
Written Exam
Interview
Part 3
Closing the Process (Post-Mortem & Recourse)
Black = employer
Blue = prospective candidate
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Poster
• Actual job opportunity advertisement
• Includes some of the information detailed on the Statement of Merit
Criteria
• Provides other information such as:
•
•
•
•
•
Area of selection – who and where*
Closing date*
General inquiries information (contact person)
Where and how to submit your application
Other information/requirements about the process:
–
–
–
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Documents required and format*
Tools that may be used to assess candidates
Results expected (job offers, pool of candidates, etc.)
Any other important information for the candidates
• It is important to submit all documents in the format requested and
within the timeline indicated as failure to do so would affect your
eligibility into the process
* Part of selection criteria
37
Statement of Merit Criteria (SoMC)
• Provides specific information about the requirements of the position
(for screening and assessing purposes). What is on SoMC will be
evaluated.
• General Information
–
Selection process number, position title, classification(s), federal
Must be
clearly
organization(s), location(s)
demonstrated
• Essential qualifications (must be met independently):
– Elements used for screening purposes:
• Screening Qualifications (education, experience, competencies)
– Assessed by means of exams, simulations, interviews, etc.
• For knowledge & competencies
38
Statement of Merit Criteria (SoMC)
(cont’d)
• Official Language Proficiency (must be met prior to hiring)
• Conditions of Employment (Example: Security clearance)
• Asset Qualifications (Qualifications that are not essential to perform the
work, but which would, now or in the future, benefit the organization or
be an enhancement in terms of the work to be performed). Can be used
for screening & selection purposes
• Operational Requirements (overtime, travel, etc.)
• Organizational Needs (Used to target groups such as visible minorities,
women, persons with disabilities, etc.). Can be used in selecting a
candidate.
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Screening
• Documents/Information used for screening purposes:
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–
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Application
Covering letter
Resumé
Supporting documents
Deadlines
• Education
– Level of post-secondary education and institution
• Experience
– Use proper wording that reflects the requirements stated in the Statement of
Merit Criteria (For example: coordinate ≠ manage)
40
Screening (continued)
• Only candidates who meet the essential criteria can be screened-in for
consideration
• Supporting documents
– Attach all other requested documents (Proof of education, citizenship
documents, performance assessments from previous employer (s), etc.)
– If you do not provide them, you may be screened-out
• Deadlines
– Screening factor – must be met
• References
41
Application form & cover letter
• Cover Letter (often used as a screening tool):
– This is the first impression you make on the employer and shows how well
you communicate in writing
– Shows the employer why they should consider your résumé
– Opportunity to highlight how your skills and qualifications will benefit the
employer
– If indicated in the poster, make sure you follow the desired format
• For example, if required, use headings or bullet format
Tip
• Trap: Some candidates fail to use the required format in the cover letter
and are screened-out on this basis
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Resumé - Showcase yourself!
– Highlight:
• Your education - level of post-secondary education (diploma, degree, master’s, etc.)
and institution
• Your work history
• Your work experience – remember to use proper wording (For example: coordinate
≠ manage)
• Your acquired competencies & skills
– Be clear, concise and demonstrate that you meet all essential qualifications
identified on the SoMC
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Resumé (cont’d)
• Resumé should be:
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–
–
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Written with the employer’s interests in mind
Professional in appearance
Targeted for a particular job or organization
“Letter-perfect” - spelling and grammar mistakes = bad impression on
potential employer
– Honest and clear demonstration of your skills, abilities and achievements
– Clear indication of what you offer to the employer
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Tips and Tricks for a good Resumé
• Useful link to help you prepare your resumé:
– http://www.youth.gc.ca/eng/topics/jobs/resume.shtml
• You can find a resumé builder on the following Service Canada website:
– http://seekers.jobbank.gc.ca/commun-common/connection-login.aspx
• Google can provide you with many “examples of resumés”. For
example:
–
http://jobsearch.about.com/od/sampleresumes/a/sampleresume2.htm
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Preparing for and participating in Exams and/or
Interviews
46
Preparing for exams and/or interview
• Remember, an interview is a two-way exchange of information
– The interviewer is interested in three things:
• Can you do the job?
• Will you do the job?
• Will you fit the job?
• You will need to be able to demonstrate this during the interview
and/or exam
• You want to know if the organization is right for you and your career
goals
• Review SoMC and make sure you understand all elements which will be
assessed in the exam or during an interview (knowledge, competencies
& skills)
47
Preparing for exams and/or interview
(continued)
• “ABOUT YOU” QUESTIONS
• SITUATIONAL QUESTIONS
• KNOWLEDGE QUESTIONS
• BEHAVIOUR BASED QUESTIONS
• ROLE PLAY
• Contact appropriate resources
48
Participating in the interview/exam
• Arrival:
– Arrive early
– Bring requested documents (if any)
– Dress for success – professional attire expected
– appropriate footwear
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Participating in the written exam
• Exam:
– Come well prepared
• You've arrived a few minutes early, checked your appearance, are unfailingly polite
and pleasant with reception
• Come well-prepared (well-rested, pen & paper, watch, snack, water, documentation
if allowed, etc.)
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–
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–
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Read all questions first and allot your time accordingly
Answer questions you know first
If time permits, check your work
Neat and legible responses will assist the evaluator
Solid communication skills are key
Demonstrate you understand the bigger picture
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Participating in the interview
• At the interview:
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Make a solid first impression
Demonstrate you understand the bigger picture
Effective communications skills are key
Present a detailed, specific and positive picture of what you can do, using
concrete examples
• Listening, confidence, and quality of presentation are the keys to successful
interviewing.
• Employers are looking for enthusiasm, some knowledge of the organization,
confidence, and an ability to work well in their environment.
• The interview is also your opportunity to assess the organization. Do you want to
work there? Can you contribute, get new skills, have a chance to advance, or will
this position open doors for you?
– ask questions that show your knowledge of the organization
– ask when they anticipate a decision will be made and how candidates will be
informed
51
Performance Expectation and
Feedback – valuable tools for you
• Establishing performance expectations and obtaining feedback are
important to supporting career development.
• Take the initiative
• Set goals with your manager
• Request regular meetings to assess your progress
• Use the performance appraisal mechanism to identify the training and
development you need – the bars are rising
• Create a learning plan and make the best possible use of it.
52
Opening Doors
• Be on the look-out for new opportunities.
• Remember to develop your soft skills: teamwork, leadership,
communication and networking:
– Take on stretch assignments;
– Volunteer on a departmental committee or an interdepartmental working
group; and
– Get involved in volunteer activities such as FMI.
• The better connected you are, the more doors will open.
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Contact us:
Sylvie Séguin, CGA
Senior Policy Analyst
sylvie.seguin@tbs-sct.gc.ca
(613) 946-6242
Sharon Smith, Director
Sharon.Smith@tbs-sct.gc.ca
(613) 952-3350
Monique Main, CPA, CA
Manager, FORD/IARD and CAST
Monique.main@tbs-sct.gc.ca
(613) 946-7635
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