Audit of Budgeting and Financial Management - Finance Management Action Plan
Management response to the Audit
The recommendations from the 2024 Audit of Budgeting & Financial Management Audit Report have been accepted and the MAP below reflects how these will be addressed.
Recommendation 1 (High risk)
The CFO should develop a Financial Management Framework (FMF), which includes how the budgeting and forecasting processes work at OSFI, the accountabilities, roles and responsibilities of each stakeholder, targets and relevant monitoring and reporting to Executive Committee.
Planned actions to support the recommendation
The CFO will develop a framework to provide structure and processes for effective financial planning, control, and decision-making. This will include the following:
- Milestone 1: Develop and document:
- Relevant budget and forecasting deliverables and timelines, including monitoring and frequency of reporting to the Executive Committee
- Roles, responsibilities, and accountabilities for key budget stakeholders (in line with service level agreements noted below)
- Milestone 2: Develop and document forecasting processes for OSFI, including timelines, accountabilities, and roles and responsibilities
- Milestone 3: Develop and document the budgeting process at OSFI, including timelines, accountabilities, and roles and responsibilities
- Milestone 4: Formalize and operationalize the FMF with EC approval
Target milestone completion
- Milestone 1: Q2 2025-26
- Milestone 2: Q3 2025-26
- Milestone 3: Q4 2025-26
- Milestone 4: Q1 2026-27
Accountability
- Chief Financial Officer, Adelle Laniel
Target overall completion
- Q1 2026-27
Recommendation #2 (Medium Risk)
In alignment with the FMF from recommendation one, Finance should define service-level expectations for Finance and Central Office Teams (COTs) related to financial management processes.
Planned actions to support the recommendation
- Milestone 1: In consultation with COTs, agree on a list of consistent and collaborative service level expectations to ensure a common understanding of the financial management process
- Milestone 2: Document the Finance-COT service level agreement (SLA)
- Milestone 3: Operationalize the Finance-COT SLA with EC approval
Target milestone completion
- Milestone 1: Q2 2025-26
- Milestone 2: Q3 2025-26
- Milestone 3: Q3 2025-26
Accountability
- Chief Financial Officer, Adelle Laniel
Target overall completion
- Q3 2025-26
Recommendation #3
- There should be an oversight body which has in its mandate to act as an oversight and monitoring function over financial management. The Integrated Planning Committee could be redesigned to include this role.
- There should be a process in place, through the oversight body referenced in Recommendation 3a, for the CFO to review and challenge budgeting and forecasting information (including resource management) against established targets to ensure integration and holistic review and challenge.
Planned actions to support the recommendation
The CFO will chair an Integrated Planning Committee (IPC), which will provide advice and recommendations to the Executive Committee on efficient planning, budget allocations and prioritization, and investment planning through the integration and alignment of plans and strategies across OSFI. This will include the following:
- Milestone 1: Review and ensure IPC membership and terms of reference is representative and fit for purpose
- Milestone 2: Define clear goals/objectives for the Committee, including:
- Strategies for developing proposals to address gaps and ensure effective resource allocation
- Milestone 3: Establish a process and frequency for the CFO to meet with and challenge sectors on their budget submissions and quarterly forecasts
Target milestone completion
- Milestone 1: Q1 2025-26
- Milestone 2: Q2 2025-26
- Milestone 3: Q3 2025-26
Accountability
- Chief Financial Officer, Adelle Laniel
Target overall completion
- Q3 2025-26
Recommendation #4 (Medium Risk)
The CFO should stabilize the budgeting exercise and include a principles-based process to consistently evaluate and reallocate resources to areas of emerging risks or new strategic priorities.
Planned actions to support the recommendation
The IPC is intended to:
- Milestone 1: Establish a governance process/forum whereby resources will be allocated according to areas of emerging risks and strategic priorities
Target milestone completion
- Milestone 1: Q4 2025-26
Accountability
- Chief Financial Officer, Adelle Laniel
Target overall completion
- Q1 2026-27
Recommendation #5 (Medium Risk)
The CFO should establish a process for variance analysis across key risk areas including thresholds for when more detailed reviews of variances are required.
Planned actions to support the recommendation
- Milestone 1: Determine the key risk areas and establish thresholds for variance analyses
- Milestone 2: Determine mode and frequency of communication for the analyses outcomes
Target milestone completion
- Milestone 1: Q2 2025-26
- Milestone 2: Q2 2025-26
Accountability
- Chief Financial Officer, Adelle Laniel
Target overall completion
- Q2 2025-26