2020-21 Financial Framework

Purpose

To define the financial framework for ESDC measures in response to COVID-19 including budgeting, forecasting and expenditures realignments (Journal Voucher) processes.

Context

Funding proposals have been or are in the process of being implemented for measures in response to COVID-19. The source of funding for these measures will be either statutory funding or an increase to ESDC’s existing sources of funds. For any sources of funding, there may be two different types of expenditures: 1- operating expenditures (including salary and/or non-salary) to administer the program, and/or 2- benefits paid directly to Canadians or organisations.

Budgeting

Once new funding proposals obtain approval (i.e. once the funding decision and Department of Finance approval on the costing are received), Corporate Resource Management (CRM) will allocate statutory operating budget to the branches and regions using the distribution and appropriate COVID-19 financial coding provided by the lead FMA.

Then, FMAs must drill-down the funding at lower levels within the organization. Note that, in most cases, the Funds Centre (FC) against which expenditures will be posted remains the same, even if employees are reassigned. It is the Fund and/or Functional Area (FA) that changes. As such, in the case of salaries, budget must be allocated to the employees FC with a different Fund and/or FA.

Forecasting

As is done for all other ESDC programs, forecasts will be required at each forecasting period (P3, P6, P8 and P10) using the appropriate COVID-19 financial coding.

Salary forecasts:

1. All Salary forecasts related to ESDC COVID-19 response should be recorded against COVID-19 specific coding (Fund, FA and Internal Order) when possible. The process will differ depending on the following two (2) situations:
1. Employees who have been reassigned 100% to one of the COVID-19 measures. These employees’ information must be modified in the Salary Forecasting Tool (SFT) using the summary and/or detailed Temporary Reassignments instructions. The forecasts will be reported automatically under the right initiatives/program (Functional Area) and source of funding (Fund).
2. Employees NOT reassigned to COVID-19 financial coding in SFT, such as employees who report their time in CATS, or employees who are dedicating some time (or overtime) to COVID-19 specific initiatives but have not been formally reassigned to COVID-19 coding in SFT (due to the level of effort). In these cases, a forecast adjustment will be required (FMBB adjustment) to realign the forecast from the existing employee coding in SFT to the correct initiative/program (Functional Area) and source of funding (Fund).

FMBB Adj (-) under the existing employees coding in SFT (Fund, FA)
FMBB Adj (+) under the new initiatives/program coding (Fund, FA)

*The recommended naming convention to use for the forecast adjustment is: COVID-19 ADJ to account for realignment to COVID (under Header text field).

Non-Salary forecasts:

Non-Salary forecasts must be recorded in the non-salary forecasting tool under the appropriate COVID-19 financial coding*.

*The functional area component does not exist in the non-salary forecasting tool.

Statutory

No forecast is required for statutory funding (benefits paid to citizens or organisations).

Realignment of Expenditures (Journal vouchers)

Salary expenditure realignments / Journal vouchers (JVs)

Expenditures realignments (journal vouchers (JVs)) must be done prior to month-end as per the established calendar in the JV Framework (currently in drafting) for expenditures related to employees NOT reassigned in SFT. This will ensure material expenditures are charged to the correct source of funding (Fund and Functional Area).

• Branches using CATS: JVs are required to ensure that salary expenditures are coded to the appropriate fund and functional area. In order to do this, all COVID-19 initiative I/Os under CATS will need to be re-mapped to the applicable fund and functional area.
• Branches and regions dedicating employees to COVID-19 initiatives (part-time or overtime) whose coding has not been formally reassigned to COVID-19 in SFT due to the level of effort: JVs may be required to realign their salary costs to the COVID-19 specific coding if it impacts different sources of funds (Fund, FA and Internal Order).
• Enabling branches employees: in general, salary costs related to COVID-19 for most of the employees in this category who are coded to internal services will not require a journal voucher to a specific COVID-19 coding because the reallocation to the proper sources of funds will be done according to the Financial Allocation Report (FAR) allocation %.

Non-Salary expenditure realignments

Although all operating and maintenance costs should be initially coded to the proper Fund, FA and IO when the P-Req or Purchase Orders are created, JVs may still be required. Regular analysis of expenditures in SAP must be done to ensure that COVID-19 related non-salary expenditures are coded to the proper sources of funds.

Departmental Financial Reporting presentation

The forecast and expenditures will be reported under these two main sections of the Departmental Financial Report: