Finance

means a receivable which remains uncollected up to 90 calendar days past the invoice date and for which two collection attempts have been made subsequent to the invoice.

Before a Government department or public agency issues goods, services, or money on credit, makes a contract prepayment [for accountable advances on contributions, see FAMs 1901 to 1906 and 2104], or issues goods on consignment, the approving officer shall:

1. Assess the credit applicant in the aggregate of all related companies listed by Financial Reporting and Collections, Department of Finance.
2. ensure that the credit applicant is not on the listing of write-offs and forgiveness maintained by Financial Reporting and Collections, Finance;
3. ensure that the credit applicant is sufficiently creditworthy; and,
4. be accountable for credit granting decisions.

1. accountable for effective credit granting and control; and,
2. responsible to ensure that credit approving officers in their departments and public agencies have the information and resources necessary to make good credit-granting decisions.

Upon request, the Financial Reporting and Collections Section of the FMBS shall assist Government departments and public agencies in determining:

1. information requirements for credit applications;
2. the credit worthiness of applicants;
3. credit limits for specific applicants; and
4. the type and amount of security required, as appropriate to the specific credit limits and circumstances of credit applicants.

The Financial Reporting and Collections Section shall maintain and make available on request to Government departments, public agencies and Regional Superintendents, Finance, a current Schedule of Write-offs listing every debt that has been written off by the Government. Each entry on the Schedule must list:

1. the name of the debtor(s);
2. the dollar amount of the write-off;
3. the department or public agency that granted the credit;
4. the Government Service Number (GSN) of the debtor(s); and,
5. if applicable, the Comptroller General’s explanation for the approval of credit granted to the debtor after any previous write-off of debt owed to the Government by the same debtor (see sub subsection 3.3.1 below).

6. current and cross-referenced Schedule of Principals of Business Entities with Debts Written Off. That includes:

   1. the name of every individual who is a principal in any business entity that owes a debt written off by the Government; and,
   2. the name of every business entity that owes a debt written off by the Government, along with the total written-off amount attributed to that entity and the name of every individual who is a principal of that entity.

If a credit application is referred to the Comptroller General (see 3.2.2 above), the Comptroller General or Comptroller General’s delegate shall:

1. review the applicant’s past credit history;
2. approve or reject the credit application; and,
3. notify the credit-granting officer’s department or public agency accordingly in writing, documenting the reasons why past credit history should or should not prevent the credit granting. If the Comptroller General, or delegate, approves the application and resulting newer debt becomes uncollectable, the explanation for the approval must be included in the documentation of any future write-off of the newer debt.

Except as indicated in 3.4.2 and 3.4.3 below, credit must be granted on the basis of creditworthiness. The approving officer shall examine the credit applicant’s financial position and credit history and shall assess:

1. the applicant’s ability to fulfil the repayment obligations; and,
2. the likelihood that the applicant will make every reasonable effort to fulfil the repayment obligations.

1. be counter to the public good such as if the applicant is the only fuel supplier for a small community;
2.  result in an undue hardship or undeserved disadvantage for the applicant such as when an outstanding bad debt or a previous bankruptcy would cause undue hardship or undeserved disadvantage for an individual applying for a student loan; or,
3. act in conflict with the intended purpose of an established government program provided the following conditions are met:
   • total funding does not exceed $50,000;
   • there is no existing “hold” on the applicant;

Departments and public agencies that advance credit, make accountable advances or contract prepayments, issue loans, or consign goods shall:

1. maintain and monitor accurate credit records, including aged accounts receivable;
2. determine whether receivables are being consistently received when due;
3. take vigorous collection action on overdue receivables (see FAM Policy 3103 - Departmental and Public Agency Responsibility for Collection of Receivables, in this manual); and,
4. keep records in accordance with the Government's records retention policies and direction on the retention, access, and disposal of financial records in the 604 series of directives in this manual.