Government of Nova Scotianovascotia.ca
gov.ns.caGovernment of Nova Scotia Nova Scotia, Canada
 
Municipal Affairs
Text Size:  A+ A-

Frequently Asked Questions

  1. How were the municipal indicators developed?
  2. How was the FCI developed?
  3. Where does the data come from for both the municipal indicators and FCI?
  4. Why do some indicators only appear every couple of years?
  5. Can the FCI’s for each municipality be compared to identify which is doing the best?
  6. A number of the indicator scores for my municipality are red. Does this mean they are bankrupt?
  7. A number of the indicator scores for my municipality are yellow. Does this mean the Municipality’s financial health is poor?
  8. A number of the indicator scores for my municipality are green. Does this mean the Municipality’s financial health is strong?
  9. My municipality has an indicator score that is better than the average for that type of municipality, but it is still red. Why?

How were the municipal indicators developed?

The municipal indicators were developed in 2002 as a joint project between the Province of Nova Scotia, the Union of Nova Scotia Municipalities (UNSM) and the Association of Municipal Administrators (AMA). Since then there has been a series of joint reviews and initiatives to evaluate the program and develop new features.  The Financial Condition Index (FCI) is a result of this partnership. 

Back to top

How was the FCI developed?

A joint committee made up of municipal representatives from the UNSM and the AMA, and provincial representatives developed the model.  The design was finalized in December 2012 after a series of workshops and focus groups with Municipal Finance Officers, AMA members and other experts. The design of the tool was endorsed by the AMA and the UNSM Boards in 2013.

Back to top

Where does the data come from for both the municipal indicators and FCI?

Every year municipalities submit financial reports to the Province of Nova Scotia.  Most of the data for the indicators comes from those reports.  However, the indicators also use property assessment data provided by the Property Valuation Services Corporation, census data from Statistics Canada, as well as information on provincial grants provided to municipalities.

Back to top

Why do some indicators only appear every couple of years?

The sources for the data used in the indicators determine when they can be updated.  Census and National Household Survey data from Statistics Canada is released once every 5 years. This means the population and socio-economic data will be updated every 5 years. Municipal voting information is only available for the years in which a municipal general election was held. They are held every four years, with the last election being held in 2012.

Back to top

Can the FCI’s for each municipality be compared to identify which is doing the best?

No. The FCI was designed as an early warning sign and provides a quick financial snapshot for each municipality. It is not meant to be a comprehensive assessment of performance for a municipality. Because the tool was designed to identify potential areas for further investigation, it is not sensitive and can’t distinguish between average and above average performance. As a result there is no value in ranking municipalities based on their FCI.

Back to top

A number of the indicator scores for my municipality are red. Does this mean they are bankrupt?

No. The FCI is simply a tool to provide a snapshot of a municipality’s financial indicators, and should be the starting point of a discussion rather than a final judgment. It is not a replacement for a professional financial audit, and can only point to areas where further investigation might be required.

Back to top

A number of the indicator scores for my municipality are yellow. Does this mean the Municipality’s financial health is poor?

No. Yellow indicators represent situations where the municipality is doing better than the threshold but is below the class average. Not all municipalities can be above the average, so there will always be municipalities that receive yellow indicators, even if there are no financial concerns related to that indicator. Please keep in mind, the FCI is simply a tool to provide a snapshot of a municipality’s financial indicators, and should be the starting point of a discussion rather than a final judgement. It is not a replacement for a professional financial audit, and can only point to areas where further investigation might be required. Even a municipality with a lot of green scores has room for improvement.

Back to top

A number of the indicator scores for my municipality are green. Does this mean the Municipality’s financial health is strong?

Green indicators represent situations where the municipality is doing better than the threshold and better than the class average. However, even a municipality with many green scores can have room for improvement.

Back to top

My municipality has an indicator score that is better than the average for that type of municipality, but it is still red. Why?

A score that is coloured red indicates that it does not meet the indicator threshold.  Although a municipality may have a score that is better that the class average, in order for the score to be yellow, it needs to meet the threshold. 

Back to top