1. Effective date
This document contains the complete text of the
Policy on Interdepartmental Settlements (IS) applicable during the FIS
transition period starting April 1, 1999.
2. Preface
The implementation of the Financial Information
Strategy (FIS) on April 1, 1999 introduced a re-engineering of the
interdepartmental settlement process. Once departments interface with the new
Receiver General suite of FIS central systems, for the majority of
settlements between departments, it will usually be the creditor that initiates
the transaction via the Standard Payment System (SPS) (a FIS central
system) rather than the debtor department. This new process should result in
significantly greater efficiencies in the processing of interdepartmental
settlements. However, temporary complexities will be experienced during the
period when there are some departments using the re-engineered approach and
others the legacy (pre-FIS) central systems.
In order to gain these efficiencies and minimise the effects of the
complexities, departments require disciplined and timely bilateral
administrative processes as part of any business arrangement between them and
such processes need to be well understood and documented. Timeliness is not a
new requirement, but an increased emphasis is being placed on it to ensure that
interdepartmental settlements are handled promptly and accurately.
This policy will focus on the requirements of the transition period. Once all
departments are connecting with the new Receiver General suite of
FIS central systems, this policy will be revised.
3. Definitions
Creditor department (ministère
créditeur) - The selling or invoicing department for the sale or transfer
of goods or services. (i.e. the department to which funds are owed (supplier or
payee) or the department to which funds are to be advanced)
Debtor department (ministère débiteur) - The
purchasing or paying department for the purchase or transfer of goods or
services. (i.e. the department which owes funds (customer or payor) or which is
to advance funds to another department)
FIS department (ministère conforme à la SIF) -
For the purposes of this policy, a FIS department is defined as a
department that interfaces with the new Receiver General suite of
FIS central systems. These systems include the Central Financial Management
and Reporting System (CFMRS), the Standard Payment System (SPS), the
Receiver General - General Ledger (RG-GL), Banking Facilities
System (BFS) and the Payroll System - General Ledger (PS-GL).
FIS transition period (période de transition à la SIF)
- The FIS transition period refers to the period during which both the
FIS central suite of systems and the Non-FIS Legacy suite of systems
will be in use. The transition period extends from April 1, 1999 to
March 31, 2001.
Interdepartmental Settlement (IS) (Règlement
interministériel (RI)) - An Interdepartmental Settlement refers to a
settlement between any two government departments or agencies that operate
within the Consolidated Revenue Fund.
Non-FIS department (ministère non conforme à la SIF)
- For the purposes of this policy, a non-FIS department is defined as a
department that interfaces with the Receiver General legacy central systems.
These systems include the Central Accounting System (CAS) and the
Accounting Data Input System (ADIS), the Departmental Reporting
System (DRS), the Interactive On-line Control Files (IOCF) and Central
Accounting Information System (CAIS).
Questioning (consultation) - An IS which is
questioned, is one which, although it has already been successfully processed
and reported to the Receiver General-General Ledger, has not been accepted by
the recipient department.
4. Policy objective
To ensure that all interdepartmental settlement
transactions (involving both FIS departments and Non-FIS departments)
are processed in a timely and accurate manner.
5. Policy statement
FIS departments are to use the interdepartmental
settlement functionality of the Standard Payment System for the processing of
settlements with all other departments.
6. Application
This policy applies to all organizations considered to be departments within
the meaning of section 2 of the Financial Administration Act.
7. Policy requirements
a) FIS departments shall use the Standard Payment
System (SPS) to process transactions with other government departments.
Exceptions to the use of an IS are identified in Chapter 9 of the
Receiver General Manual.
b) This policy does not apply to intradepartmental transactions.
FIS departments must not use the SPS to process transactions within the
same Receiver General assigned department number.
c) During the transition period:
i) For transactions between two Non-FIS departments -
Both non-FIS departments will continue to use the Receiver General's
legacy systems.
ii) For transactions between two FIS departments -
The FIS-creditor departments will initiate an IS using SPS for the majority
of transaction types. Exceptions, where the debtor department will initiate an
IS, are listed in Chapter 9 of the Receiver General Manual.
iii) For transactions between a FIS creditor department and a
non-FIS debtor department -
The FIS creditor departments will initiate IS transactions
through SPS, as well as issue invoices or requests for payment and any other
relevant documentation to the non-FIS debtor department. The
non-FIS debtor will initiate the prescribed transaction through the
legacy system.
iv) transactions between a non-FIS creditor department and a FIS debtor
department -
The FIS debtor department will initiate an IS transaction through
SPS on receipt of an invoice or request for payment from the
non-FIS creditor. The non-FIS creditor department will reflect the
prescribed output in their legacy system.
d) Departments must adhere to the following time limits for the processing
and questioning of transactions. Prior to proceeding with
"questioning" of an IS, departments should clarify and resolve the
issues through bilateral discussions. Departments are to follow
IS processing guidelines prepared by the Receiver General that are
available on the Intranet at
http://publiservice.pwgsc.gc.ca/cars-sccr/is/welcome-e.html
i) Processing and "questioning" between two FIS departments
-
If an IS in SPS is considered to be incorrect for any significant reason
(incorrect recipient, incorrect amount, goods or services not received or
other conditions not met, duplicate), both departments may use the
functionality in SPS to question (i.e. reverse) the transaction. The
department must question a transaction within 15 working
days of receipt of the SPS notification.
Questioning functionality in SPS is not available after the last working
day of March for transactions of the previous fiscal year, as per the Year-end
Procedures issued by the Receiver General.
ii) Processing between two non-FIS departments -
Debtor departments must process a transaction within the legacy system within
15 working days of receiving an invoice or request for payment.
iii) Processing between a FIS creditor department and a
non-FIS debtor department -
The non-FIS debtor departments must process a transaction within the
legacy system within 15 working days of receiving an
invoice or request for payment. The FIS creditor must separately process
the credit side of the transaction within the SPS.
Where the invoice or request is incorrect for any significant reason
(incorrect amount, goods or services not received or other conditions not met,
incorrect debtor department, duplicate invoice or request for payment), the
departments should agree on action to be taken within 15 working
days.
iv) Issuing of old year invoices after March 31 -
Invoices relating to old year must be issued within 10 working
days following March 31.
e) Disagreements between departments should be resolved before the end of the
next accounting period or, at the very latest, prior to the end of the current
fiscal year.
f) Where the departments cannot come to an agreement on a particular
transaction, and the amount involved exceeds $100,000, the Office of the Deputy
Comptroller General of the Treasury Board Secretariat will provide a dispute
resolution service. The following procedures must be followed.
i) The departments involved are to provide written documentation of the
dispute, including all relevant information and argumentation, to the Office
of the Deputy Comptroller General. The documentation is to be signed by the
Senior Financial Officers of the departments involved. One jointly prepared
document is preferred. If separate documents are submitted, each SFO must also
send the documentation to the other SFO(s).
ii) The Office of the Deputy Comptroller General will review the
documentation and, where necessary, will convene a meeting of the Senior
Financial Officers of the departments involved.
iii) The recommendations of the Office of the Deputy Comptroller General
will be final. Any recommended action(s) must be taken by the department(s)
involved before the end of the current accounting month.
g) The Receiver General is responsible for issuing detailed instructions on
departmental processing of interdepartmental transactions and on departmental
reconciliation efforts.
8. Monitoring
The internal audit plans of departments, agencies and other organizations
covered by this policy should include a review of operations related to the
requirements of this policy.
9. References
This policy is issued under the authority of the Financial
Administration Act and should be read in conjunction with:
- The Receiver General Manual, Chapter 4 (Standard Payment System (SPS))
http://publiservice.pwgsc.gc.ca/cars-sccr/pdf/chap9e.pdf
- The Receiver General Manual, Chapter 9 (IS Processing during the FIS
Transition Period)
http://publiservice.pwgsc.gc.ca/cars-sccr/pdf/chap9e.pdf
- The Receiver General Manual, Chapter 11 (Reconciliations Required by
Departments under FIS)
http://publiservice.pwgsc.gc.ca/cars-sccr/pdf/chap11e.pdf
- IS processing guide, (RG on-line web site)
http://publiservice.pwgsc.gc.ca/cars-sccr/is/welcome-e.html
- Treasury Board Secretariat Policy on Account Verification
10. Enquiries
Enquiries concerning this policy should be directed to your departmental
headquarters. For interpretation of this policy, departmental headquarters
should contact:
Financial Management and Accounting Policy Division
Comptrollership Branch
Treasury Board of Canada Secretariat
L'Esplanade Laurier
300 Laurier Avenue West
Ottawa, Ontario
K1A 0R5
Telephone: (613) 957-7233
Facsimile: (613) 952-9613
E-mail address: dcg-scginformation@tbs-sct.gc.ca
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