Cost Modeling

Health Canada is in the process of developing a new costing/funding model to support its internal services (IS) resources requirement. The project is still in its early stages. This Request aims to mobilize external resources to support the Office of Revenue and Costing (ORC) in the successful development of an IS Costing/Funding model as a tool to estimate incremental resource needs to provide support for new and renewal of departmental initiatives, as well as determining the full cost of such services for purpose of fees setting under cost recovery regime or similar endeavors.

ORC is actively engaging the relevant stakeholders to participate in the design of the internal service costing/funding model that will require additional resource supports. Specifically, ORC is and will engage the Branch Senior Financial Officers of Corporate Services Branch, Strategic Policy Branch, Chief Financial Officer Branch, Communications and Public Affairs Branch, and Departmental Executives; as well as the Financial Services of Public Health Agency of Canada and the respective internal service providers.

ORC will require additional expertise that is well versed in costing and accounting to

• Establish the baseline and gather the relevant data and information for the internal service model; • Evaluate data collected and validate nature and classifications of the information (e.g., fixed, semi-variable and steps, or variable; direct vs. indirect; sunk, etc.); • Identify and develop acceptable (defendable) criteria that are tangible and measurable for purpose of determining cost drivers, • Assess appropriate cost drivers for the relevant internal service activities and to recommend the approach for funding request that best match the costing needs; and • Develop the costing/funding model and document the process

The Contractor will take on the role of an advisor, to provide expert advice on the treatment of internal service costs and the funding approach that best match their characteristics and behavior, in the development of methodology for a model that would include but not limited to the following:

• To be based on the internal service cost and expenditure incurred historically by the Department to support its existing regulatory programs and operations; • Would estimate the funding needs of internal service activities for supporting the continued or of new/increased program activities (incremental cost), as well as internal service funding in a full cost scenario (e.g., cost recovery); • To be simple, transparent, scalable that can be easily understood and verified by a third party; and most importantly • To be defendable before senior departmental and TB officials and representatives as well as for CFO attestation purposes; and • To develop the relevant guidelines and document that provide explanations and reference for the users of the internal service costing/funding model

Past experience, accompanied by recognized professional accounting accreditations or designations will be an asset.