1.1 This directive takes effect on October 1, 2009.
1.2 It replaces the following:
2.1 This directive applies to departments as defined in section 2 of the Financial Administration Act.
2.2 Those portions of sections of this directive that provide for the Comptroller General to monitor compliance with this policy within departments and/or request departments take corrective action, do not apply with respect to the Office of the Auditor General, the Office of the privacy Commissioner, the Office of the Information Commissioner, the Office of the Chief Electoral Officer, the Office of the Commissioner of Lobbying, the Office of the Commissioner of Official Languages and the Office of the Public Sector Integrity Commissioner. The deputy heads of these organizations are solely responsible for monitoring and ensuring compliance with this policy within their organizations, as well as for responding to cases of non-compliance in accordance with any Treasury Board instruments that address the management of compliance.
3.1 "Specified purpose accounts" is a broad classification of accounts established in the accounts of Canada and reported in the Public Accounts of Canada. SPAs, record transactions and expenditures for money payable out of the Consolidated Revenue Fund (CRF) under statutory authorities established for specified purposes.
3.2 This directive ensures that SPAs, which represent public money, are prudently managed and properly classified and reported in the Public Accounts of Canada.
3.3 To carry out various responsibilities in managing SPAs, it is essential that the chief financial officer and other persons designated by the deputy head fully understand the distinction between SPAs that record special purpose money and SPAs that do not record special purpose money.
3.4 SPAs used to record special purpose money - These are usually operationally established and record obligations and expenditures in respect of money received by the Crown for a special purpose as defined in sections 2(d) and 21 of the Financial Administration Act.
3.5 Most other SPAs - These are generally legislatively established and do not relate to special purpose money as defined in section 2(d) and 21 of the Financial Administration Act. These SPAs include both liability accounts and accounts that record revenues and expenditures authorized under statutory programs or for other statutorily specified purposes.
3.6 The distinction between the two types of accounts is further explained in Appendix B.
3.7 This directive supports the Policy on Internal Control and is to be read in conjunction with the Receiver General Directive 1997-6.
3.8 This directive is issued pursuant to section 7 of the Financial Administration Act.
Definitions to be used in the interpretation of this directive are in Appendix A.
To ensure that controls and processes are developed and maintained to correctly identify, classify, record and report specified purpose accounts; and that specified purpose accounts are effectively and prudently managed, including those accounts used to record special purpose money.
6.1 The chief financial officer is responsible for:
Control
6.1.1 Ensuring that effective management practices and controls are established, which specifically involves the following:
6.2 The chief financial officer or senior officials(s) designated by the deputy head to carry out the management of specified purpose accounts are responsible for ensuring the following:
General
6.2.1 Monies received for a special purpose and amounts collected or prescribed as credits under statutory benefit programs or for other statutorily specified purposes, are recorded in separate accounts in the accounts of Canada and reported separately in the Public Accounts of Canada.
6.2.2 All amounts credited to SPAs, whatever the source, are managed as public money. Accordingly, all regulations, policies and directives relating to the control of receipts and expenditures apply to funds received, credited and paid out for a special purpose or a specified purpose.
6.2.3 Any request to the Receiver General to open an SPA, including accounts recording special purpose money, is submitted according to Receiver General Directive, 1997-6, and clearly identifies the following:
6.2.4 Processes are set up to prevent insufficient balances from occurring, including the establishment of a hold period for cheques and money orders to avoid NSF and fraud.
6.2.5 In accordance with FAA section 21, disbursements are not made from the account if there are insufficient funds at the time the payment is to be made and accounts do not go into a debit balance, unless authorized by legislation.
6.2.6 Goods and services tax (GST) and harmonized sales tax (HST), payable on expenditures that are charged to SPAs that record cost-sharing agreements are charged to the SPAs instead of the GST/HST refundable advance accounts. (Refer to section on 9.1.4 "Cost-Sharing and Joint Project Agreements" in the Financial Information Strategy Accounting Manual.)
6.2.7 Precise accountability statements are developed and documented for each manager responsible for administering specific cost-shared agreements, other similar arrangements as well as gifts, donations, bequests, contributions and endowment funds.
Recording of special purpose money
6.2.8 An SPA is opened to record special purpose money only if all of the following conditions are met:
6.2.9 Interest on amounts credited to SPAs that record special purpose money is authorized by specific statute or, in the absence of such authority, allowed under subsection 21(2) of the Financial Administration Act at rates fixed by the Minister of Finance with Governor-in-Council approval.
6.2.10 Special purpose money received is not used to replace or avoid seeking the authorities required for cost-recovery activities (e.g., where fees for goods, services or the use of facilities would normally be charged). A department that has received special purpose money could, however, use the services of another department with special revenue spending authority to carry out or supply the special purpose activity.
6.2.11 Special purpose money is not used to reimburse departmental operating costs (e.g., salaries of government employees) incurred in a cost-shared (joint) project, joint venture, federal-provincial or other arrangement.
6.2.12 Special purpose money may only be accepted by a department when the special purpose activity is within the department's mandate.
6.2.13 Donations are:
6.2.14 Once the objective for which special purpose money was received has been realized:
Specified purpose accounts other than those recording special purpose money
6.2.15 Interest on amounts credited to SPAs that are not used to record special purpose money is authorized only by specific statute.
6.2.16 SPAs related to joint ventures, partnerships, and insurance and benefit programs are only established pursuant to legislation or by an Order-in-Council.
6.2.17 When legislation (or other establishing authority) does not authorize the cost of administration to be charged to the account, costs incurred for the administration of SPAs are charged to a departmental appropriation.
6.3 Monitoring and reporting requirements
6.3.1 Chief financial officers are responsible for supporting the deputy head by overseeing the implementation and monitoring of this directive in their departments, bringing to the deputy head's attention any significant difficulties, gaps in performance or compliance issues and developing proposals to address them, and reporting significant performance or compliance issues to the Office of the Comptroller General.
6.3.2 The Comptroller General is responsible for monitoring departments' compliance with the requirements of this directive and conducting a review within five to eight years.
7.1 In instances of non-compliance, deputy heads are responsible for taking corrective measures within their organization with those responsible for implementing the requirements of this directive.
7.2 In support of the responsibility of deputy heads to implement the Policy on Internal Control and related instruments, chief financial officers are to ensure corrective actions are taken to address instances of non-compliance with the requirements of this directive. Corrective actions can include requiring additional training, changes to procedures and systems, the suspension or removal of delegated authority, disciplinary action, and other measures as appropriate.
7.3 Individuals are reminded that sections 76 to 81 (Civil Liabilities and Offences) of the Financial Administration Act as well as sections 121 (Frauds against the Government), 122 (Breach of Trust), 322 (Theft) and 380 (Fraud) of the Criminal Code may apply.
This section identifies other departments with significant roles with respect to this directive. In and of itself, it does not confer an authority.
8.1 Public Works and Government Services Canada sets out the requirements for the establishment of and accounting for SPAs, including those recording special purpose money, within the accounts of Canada. SPAs of any type can only be opened with the approval of the Receiver General.
8.2 The Minister of Finance, with the approval of the Governor in Council, is responsible for determining the interest rate to be credited on special purpose money under subsection 21(2) of the Financial Administration Act, if the discretion to credit interest is exercised.
8.3 The Treasury Board Secretariat, Office of the Comptroller General is responsible for development, oversight and maintenance of this directive and for providing interpretative advice.
10.1 Please direct enquiries about this directive to your departmental headquarters. For interpretation of this directive, only departmental headquarters should contact:
Financial Management Policy Division
Financial Management and Analysis Sector
Office of the Comptroller General
Treasury Board Secretariat
Ottawa ON K1A 0R5
Email: fin-www@tbs-sct.gc.ca
Telephone: 613-957-7233
Fax: 613-952-9613
10.2 For enquiries related to the establishment of SPAs, departmental headquarters should contact:
Chief
Accounts of Canada Analysis Section
Accounts of Canada, Accounting, Manuals, and Quality Assurance Division
Central and Public Accounts Reporting Directorate
Accounting, Banking and Compensation Branch
Department of Public Works and Government Services
Gatineau, QC K1A 0S5
Telephone: 819-956-1796
Fax: 819-956-8400
10.3 For enquiries related to approval of the crediting of interest on an SPA, departmental headquarters should contact:
Director
Financial Markets Division
Financial Sector Policy Branch
Department of Finance
Ottawa ON K1A 0G5
Telephone: 613-992-9032
Fax: 613-943-2039
10.4 For enquiries related to interest rates, departmental headquarters should contact:
Manager, Departmental and Public Debt Reporting
Financial Management Directorate
Corporate Services Branch
Department of Finance
Ottawa ON K1A 0G5
Telephone: 613-996-9822
Fax: 613-995-1325