Introduction

The Government of the Northwest Territories’ (GNWT) Financial Administration Act (FAA) has been updated and was put into force on April 1, 2016.

Background and Context

Through Bill 37, the 17th Legislative Assembly approved the modernization of the Financial Administration Act (FAA), to establish a framework for improved accountability, transparency and fiscal responsibility in respect of public money and other money administered by Government and public agencies.  The in force date of the new FAA will be April 1, 2016, which will place into effect the first major update of the FAA since 1987.  This necessitates the corresponding update to the Financial Administration Manual (FAM) for April 1, 2016, which will require the approval of the Financial Management Board.

The Project Scope of the update to the FAM is as follows:

  • Consequential updates to policies to align with new FAA
  • Reformat Manual to be policy based
  • Reformat sections that will apply to the broader Government Reporting Entity
  • Information sessions to support transition to updated FAM

As a result of the development of the new FAA, existing FAM policies needed to be reviewed to assess the need for policy revisions to comply with the new FAA.  This presented both a requirement and an opportunity to modernize the FAM to reflect the GNWT’s current operating environment as well as incorporate best practices.

Implementation

The Office of the Comptroller General reviewed the existing FAM to determine how best to move the new manual forward. It was determined that the project would result in the best product, and subsequent implementation, if it was segregated into three phases:

Phase 1

High priority FAM policies addressed for April 1, 2016 which include existing policies that require amendments due to implementation of the FAA, the new Fiscal Responsibility Policy or the Planning and Accountability Framework.

Phase 2

Updated FAM policies relating to Treasury functions will be submitted for approval to the FMB in mid-2016.

Phase 3

The remaining FAM policies will be submitted for FMB’s consideration by late 2016.

The FAA provides the Financial Management Board (FMB), the Minister of Finance and the Comptroller General with broad responsibilities and authorities for approving and implementing accounting, budgeting, and financial administration policies, in accordance with the legislation applicable to the Government of the Northwest Territories, Public Agencies (listed in schedules A, B and C to the FAA), and other reporting bodies. These three bodies are collectively referred to in the FAA and the financial accounting standards as the “government reporting entity.”

Use of the term “GNWT Departments” in Financial Administration Manual (FAM) policies means the Government of the Northwest Territories, but excludes public agencies and other reporting bodies.  This terminology is synonymous with “Government” as defined in the FAA.

The FAM is intended to provide policy direction regarding the purpose and scope of the mandatory provisions of the FAA, related regulations, and areas requiring direction for effective financial administration.  The policies are based on the principles and concepts for each item.  The use of professional judgment is expected when interpreting and applying each policy by the applicable bodies.  Each policy includes information on operational roles and responsibilities as well as the applicable sections of the FAA or other legislation and publications for further reference.

Interpretation bulletins have been, and will continue to be, developed and amended for certain policies, as needed, to provide additional clarity and illustrate the application of the policy.  Interpretation bulletins are maintained by the appropriate Administrator identified within each policy, and can be accessed by hyperlinks within the policies, as applicable.  Consultation must be undertaken with the Administrator of the applicable FAM policies regarding proposed amendments to policies or related interpretation bulletins.

We are working together as a community of GNWT Departments and Public Agencies to strengthen accountability and transparency while providing the flexibility in policy to allow for the various organizations’ operational circumstances.

To assist in the transition to implementing the updated FAM policies, the Department of Finance will be making the FAM policies available on Finance’s website (http://www.fin.gov.nt.ca/FAM), providing orientation sessions in regional centres in the NWT in April 2016, and continuing to develop interpretation bulletins in consultation with GNWT Departments and Public Agencies.

For further information on the FAM update project, please contact:

Louise Lavoie, Assistant Comptroller General
Government of the Northwest Territories
Phone: 867-767-9171, Ext. 15080
Email: louise_lavoie@gov.nt.ca