Effective Date: August 10, 2017
Last revised: October 2, 2025
Applicable FAM Policies: 310 - Supplementary Appropriations
Applicability: GNWT Departments

INTERPRETATION

Where an expense has been incurred by a department that causes an appropriation to be exceeded, the Comptroller General may, at the end of a fiscal year, record the amount by which the liability exceeds the appropriation as a deemed appropriation for that fiscal year. 

This does not apply where the expense incurred requires that budgets be moved between capital and operations and maintenance. Transactions of that nature must be submitted to the Financial Management Board (FMB) for approval, utilizing the template for transfers between Activities. 

Deemed appropriations are reviewed based on the Department’s submission to the Financial Management Board on activity over-expenditures. The activity over-expenditures should include reasons why the expenditures could not have been addressed within the limits of the original appropriation including any supplementary appropriations. This should only be done once the year-end audit is substantially completed, and the departments’ expenditures include all expected post closing adjustments.  

Amounts determined to be deemed will be included in the Interim Financial Report as well as the Public Accounts. Any amounts not deemed will require a supplementary appropriation. 

For additional clarity, amounts that the Comptroller General considers to be deemed per section 77 of the Financial Administration Act (FAA), are typically amounts where there is limited discretion, are unforeseen and do not contradict other requirements for appropriations or expenditure controls in the FAA or the Financial Administration Manual. 

Instances where a deemed appropriation may be recorded include:

• Expenses related to year end employee pay and benefits, severance and retirement allowances, amounts that are established in pre-existing employment contracts and some pension adjustments.
• Expenses related to year end accounting adjustments for liability amounts such as inflation and present value calculations.
• Expenses where a budget correction was required after year end and at a government level does not change the overall surplus/deficit i.e. department A incurs the program expenses and department B has the budget but shows a lapse of the same amount.
• Expenses related to adopting new accounting standards or policies that are completed at year end.
• Materiality considerations determined by the Comptroller General 
• Expenses resulting from unexpected revenue neutral cost share agreements that could not have been anticipated by the cut off for the last supplemental appropriation of the fiscal year.

A deemed appropriation is not meant for:

• Departments exceeding their appropriation for programs and services that went over budget during the year; and/or
• Events that could have been included in a supplementary appropriation before March 31 of that fiscal year.