Financial Forecasting Overview

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Financial forecasting is a periodical review exercise of the department’s annual spending estimates, conducted at periods 3, 6, 8 and 10 of the fiscal year. The purpose of these exercises is to monitor the financial position of the department so that funding levels are not exceeded, to allow for the reallocation of resources to changing priorities, and to ensure that the department makes the best use of available resources.

Employment and Social Development Canada (ESDC) utilises 3 different tools to develop the departmental forecast:

  • The Salary Forecasting Tool (SFT) for salary forecasting;
  • The Non-Salary Forecasting Tool for non-salary forecasting, including Operations and Maintenance (O&M) and Grants and Contributions (G&C); and
  • Business Intelligence (BI) for reporting, as well as to consolidate salary and non-salary forecasts.
  • Financial Resource Management Principles

    The following principles must be kept in mind and respected while preparing financial forecasts:

    • Managers must manage within their allocated budgets, with emphasis on supporting departmental priorities;
    • Any pressure or surplus should be identified as early as known to support strategic decision making;
    • Staffing plans should be aligned with approved budgets and must consider future obligations;
    • Salary forecasting data should be monitored and updated on an ongoing basis;
    • Non-salary commitments and expenditures should be reviewed on an ongoing basis and closed whenever possible.
  • General documentation

    The Chief Financial Officer Branch (CFOB) has developed key documents that can assist managers in understanding financial management in ESDC as a whole, and the forecasting process in particular. Notably:

  • Roles and Responsibilities

    Managers are responsible for developing and approving the periodic forecast for their funds centre as they are ultimately accountable for their budgets. This includes:

    • Reviewing budget allocations using the myEMS (SAP) Portal reports;
    • Reviewing salary forecasting data and expenditures in the Salary Forecasting Tool (SFT);
    • Communicating any required adjustments to SFT data to Branch Management Services (BMS)/Regional Management Service (RMS) or to the Financial Management and Advisory Services (FMAS) unit so that data in the financial system is as accurate as possible;
    • Reviewing non-salary commitments and expenditures, including O&M and G&C,using the myEMS (SAP) Portal reports;
    • Entering all non-salary (O&M and G&C) forecasts in the Non-Salary Forecasting Tool;

    In addition, and working in conjunction with BMS/RMS or FMAS, managers must review and analyse total forecasts compared to available budgets using the myEMS (SAP) Portal reports and provide an explanation for any variances between available budgets and planned expenditures.

  • Timelines

    Departmental forecasting exercises are conducted regularly at periods 3, 6, 8 and 10. These exercises generally start on the first business day of the applicable period and run to the last day of the period when final branch and regional forecasts, as approved by each Assistant Deputy Minister (ADM)/Executive Head (EH), are provided to the CFOB. Internal timelines for each branch and region are determined by the BMS/RMS, and/or FMAS, and are communicated to all managers at the start of each forecasting exercise.

  • Identifying a Designate

    While managers have delegated financial authority and are responsible for the approval of forecasts, they can assign a "Designate" to access the self-service financial reports and enter non-salary forecasts into the Non-Salary Forecasting Tool on their behalf. To change or add a designate, managers must Report an Incident through the myEMS (SAP) Portal.

  • Training

    ESDC has developed training material that supports managers in the exercise of their delegated financial authority, particularly as it pertains to using ESDC’s financial system myEMS (SAP). These include: