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About This FAM

Responsible Agency: Government Accounting - Finance
Issued: Oct 2001
Last Updated: Oct 2001

1. Introduction

A revolving fund must be established by an enactment in accordance with Section 59 of the Financial Administration Act.

2. Definitions

"revolving fund" a fund (composed of money, accounts receivable, inventories, liabilities, or some combination thereof) that is provided with continuous and non-lapsing authority to retain revenues and to make disbursements from the Consolidated Revenue Fund for specific purposes and within specific limits.

3. Policy

A revolving fund must be established by an enactment and operated in accordance with the Financial Administration Act, as set out in the following Provisions.

4. Directives

4.1

The following quotations from the Financial Administration Act apply to revolving funds.

  1. No revolving fund shall be established except by Act.
  2. At the end of each fiscal year, each Deputy Minister whose department administers a revolving fund shall
    1. prepare a balance sheet and a statement of operations for the revolving fund and any other information that the Comptroller General may require;
    2. transfer any profit in a revolving fund to the Consolidated Revenue Fund as public revenue; and
    3. charge any loss in the revolving fund to an appropriation.
  3. In addition to any records established under paragraph 12(2)(b), every Deputy Minister shall ensure that adequate records are kept in respect of the public property administered by his or her department.
  4. (1) The Minister of Finance may, by order, establish Boards of Survey, fix their duration and specify the nature of their inquiries under paragraph 63(1)(a).

    (2) The Minister of Finance may appoint as many public officers to be members of a Board of Survey as the Minister considers appropriate.
  5. (1) A Board of Survey shall
    1. inquire into and make recommendations on revolving funds; and,
    2. perform other duties that may be prescribed or assigned to it by the Minister of Finance.
    (2) An inquiry must be made by a Board of Survey for each revolving fund at least once every four years.
  6. Where a Board of Survey or public officer recommends the deletion of any public property from the inventory of a revolving fund
    1. the Deputy Minister may direct the deletion of all or any part of that property from the inventory if the value of the property to be deleted does not exceed $20,000; and,
    2. the Financial Management Board may direct the deletion of all or any part of that property from the inventory if the value of the property to be deleted exceeds $20,000.
  7. (1) Where the [Financial Management] Board determines that public property is surplus to the requirements of the Government or that its disposal is in the best interests of the Government, the Board may authorize the disposal of the property.

    (2) The proceeds from the disposal of public property must be credited to an appropriate revenue account.
4.2

The Comptroller General shall maintain a separate account for each revolving fund to which shall be charged:
4.3 All money received from the operations of the revolving fund shall be shown as credits to the revolving fund.
4.4 The balance of a revolving fund (the aggregate of all payments charged to the revolving fund, less all credits to the revolving fund) shall not exceed an amount established by enactment.
4.5 At the end of each fiscal year the inventory and accounts receivable of the fund will be valued. If the value exceeds the total of expenditures and liabilities the excess will be transferred from the revolving fund and recorded as revenue in the Consolidated Revenue Fund. If the value is less than the total of expenditures and liabilities the deficiency will be charged to an appropriation. If a Supplementary Appropriation is not obtained and the deficiency will cause the appropriation to be exceeded, the Comptroller General may in accordance with the Financial Administration Act, Sections 36(2) and 37(2), charge the value of the deficiency and the amount by which the deficiency exceeds the appropriation is an interim appropriation for that fiscal year.
4.6 For each revolving fund, the Minister of Finance shall form a Board of Survey at least once in every four years to inquire into the state of the revolving fund.
4.7 The Board of Survey will recommend the deletion from inventory of obsolete, lost or destroyed stores for approval by the Minister of Finance, to be disposed of as directed by the Government Policy - Disposal and FAM Policy 2303, 2305, 2208, 2209 in this manual.
4.8 If any stores deleted exceed five hundred dollars, a statement, approved by the Minister of Finance, is to be included in the Territorial Accounts.