Transcript
Transcript: The Impact of Delegation of Financial Authorities on Your Day-to-Day Work
Narrator: Each minister in the federal government is responsible for resource management within his / her department. However, it is impossible for one person to assume full management of an entire department. Ministers therefore appoint subordinates to exercise specific powers for which they will be accountable. This is commonly known as « delegation of authority », as defined in the Financial Administration Act under Sections 32, 33, and 34.
Delegation of authority ensures the sound governance of public resources, notably with respect to fiscal management.
Generally speaking, managers are responsible for initiating and approving expenditures. They must have been granted the necessary authority to do so, and must respect the limits within which they are authorized to approve these expenditures or contracts.
Some key rules govern the authority to sign financial documents:
- The minister (and the deputy minister) must delegate in writing.
- Authority is delegated to a position.
- The supervisor must appoint a person to exercise the delegated authority.
- An individual who has been delegated signing authority may not delegate it to another individual.
- An individual should not exercise more than one of the following authorities for the same transaction: transaction authority (authority to enter into contracts), certification authority, payment authority.
- And finally, an individual may not authorize a transaction from which he / she might benefit.
Let's take a closer look at the expenditure process. There may be as many as six steps to ensure the proper governance of authority and accountability.
The process starts with a request for goods or services.
The first step is the authority to incur expenditures; for example, when a manager approves a training plan.
Step 2 is the authority to carry out one or more specific functions related to the control of financial commitments. In other words, making sure that funding will be available to pay an account when it's due, before approving the transaction under Section 32.
The third step is the authority to enter into contracts, including purchasing with an acquisition card.
Step 4 is the receipt of goods or services.
Then it must be certified that the work has been performed as required, services and supplies have been satisfactorily provided, and the payment complies with policy requirements.
This certification authority represents Step 5 and is referred to as Section 34.
Finally, the sixth step is the authority to pay, pursuant to Section 33. This function is usually performed by a financial officer after reviewing the legality of payments and exercising all appropriate financial controls.
All these steps aim to provide government with the assurance that expenditures are carried out in a responsible manner and that each stakeholder is accountable for his / her actions.
