Problem Solving


Problem Solving means understanding a work-related problem or situation, and taking action to resolve it appropriately.

Core motivation: To understand and resolve a problem or situation

It's about:

All individuals solve problems at work on a daily basis. Problems are often at the center of people's day-to-day work; for instance, solving a problem while providing service to a client, helping colleagues to come up with options to resolve a problem, or addressing inconsistencies in current operations.

Problem Solving includes both your reasoning process and your actions to resolve the situation or problem.

There are several ways that can assist you to get a better understanding of the situation or problem, such as:

For example, if you face a math problem, you use a logical approach to understand and work through the math problem, then take some action to figure out the appropriate solution.

Problem Solving - What it means and does not mean
Problem Solving means... Problem Solving does not mean...
  • Breaking down problems into component parts
  • Considering the chain of events that led to a problem
  • Thinking ahead about the consequences of an action ("If I do A, then B and C will also happen")
  • Analyzing a problem before offering a solution
  • Looking at the problem from different angles
  • Dealing with a problem by trying out the first thing that comes to mind
  • Overlooking the factors that led up to the problem
  • Solving the immediate problem without thinking about the consequences and what other problems may follow
  • Jumping to a conclusion without thinking through the facts
  • Accepting facts and information as presented

Purpose of this competency for CRA

Problem Solving describes actions required to analyze problems and determine the best solutions for CRA.

Progression of scale - Complexity of the problem or situation and degree of effort needed to determine a solution

The Progression of the scale works together with the underlying notions, so it is important to consider this information as it indicates how the behaviours progress as you move from level 1 to level 4. The behaviours generally build on each other.

Problem Solving - Progression of scale
  Lower Levels Higher Levels

Complexity of the Problem or Situation
Complexity means that the problem or situation is composed of a variety of connected or related parts, causes, or consequences.

The problem or situation is basic, therefore the degree of effort required to understand it is minimal.

The problem or situation has numerous interrelated parts, therefore the degree of effort to understand it is significant.

Degree of Effort Needed to Determine a Solution

The solution is relatively straightforward and can be logically determined by making simple links between key parts of the information.

The solution requires interpretation of the different perspectives or a broader analysis; and is more complete, integrated or holistic.

Problem Solving level 1
Underlying Notion Behaviours could include, but are not limited to:

Recognizing a basic problem or situation and choosing an appropriate solution

  • Identifies facts or information to be collected.
  • Asks pertinent questions and distinguishes between relevant and irrelevant information.
  • Identifies the main problem or issues to be addressed.
  • Determines a solution from a limited number of pre-established responses or options.

In other words, you may:

At this level, the problem or situation is fairly straightforward and the degree of effort needed to resolve it is minimal. You often follow a simple step by step path to a clear solution.


The tax agent received a call from a taxpayer who wanted to know why he had not yet received his tax refund. The agent followed confidentiality guidelines and the step by step procedures included in the computer system, then asked the taxpayer some questions. The agent considered the information on the computer screens and that provided by the taxpayer. When he compared the information, the agent saw that the taxpayer had moved to a new address and had not notified the CRA. He informed the taxpayer of the appropriate steps to correct the situation.

Problem Solving level 2
Underlying Notion Behaviours could include, but are not limited to:

Making key connections to determine a solution to a problem or situation

  • Gathers and evaluates additional facts and information in order to gain a better understanding of the situation.
  • Recognizes situations where standard procedures may not apply and a different solution is required.
  • Notices and reconciles conflicting or incomplete information to make sense of the situation.
  • Finds links between related elements to come up with a logical solution.

In other words, to make more sense of the problem or situation, you may:

At this level, the problem or a situation has a greater degree of complexity and the solution is not immediately obvious. In determining a solution, you make key connections between relevant parts of the information you have analyzed.

Those steps require greater effort since there are additional elements to reconcile before coming up with a logical solution that matches with the specifics of the problem or situation.


An officer reviewed a file to determine if it met the criteria for taxpayer relief. During her initial review, she was under the impression that the taxpayer might qualify for interest relief, but there was information missing to confirm this. She contacted the taxpayer to verify her understanding of the situation and asked him questions to obtain additional information. More specifically, the officer asked the taxpayer to provide a letter from the bank confirming that financing was denied, but he refused to provide such a letter. The officer then completed a credit search to determine the taxpayer’s ability to pay and compared her result against the taxpayer relief provisions. She concluded that this taxpayer did not meet the guidelines for financial hardship as there was equity that could be applied to the debt and she informed him accordingly in writing. Shortly afterwards, the taxpayer advised that financing had been obtained and the debt would be paid in full.

Problem Solving level 3
Underlying Notion Behaviours could include, but are not limited to:

Interpreting and combining information from diverse sources to resolve a complex problem or situation

  • Addresses a problem or situation where there is room for interpretation.
  • Gathers and integrates relevant information from various sources and considers different perspectives to arrive at a solution.
  • Identifies patterns or trends, and evaluates the way the various factors interact and impact the situation.
  • Evaluates the risks and benefits of alternate solutions.
  • Anticipates obstacles and considers how to overcome them.
  • Works through a number of steps to reach a sound solution to a complex problem or situation.

In other words, to gain a global understanding of the complex problem or situation you may:

At this level, the problem or situation is more complex, with a large number of data, factors or parts that need to be taken into account. Interpretation of the information is then required to integrate the various parts appropriately. Significant effort is spent to consider potential options before you come up with the proper solution that will resolve the complex problem or situation.


A manager was requested by her Assistant Director to develop an organizational structure to deal with a new service delivery model, changing from providing client services at the counter to appointment only. The challenge was that she would have to ensure continued client service and she had limited information on how to implement the change.

She researched what other offices did in similar transformations and concluded that the same approach would not work in her office as their organizational structures were quite different. However, she found some interesting reports on the numbers of appointments requested, peak times of day for client enquiries, types of questions, and average time per request. No information was provided which would indicate if former counter clients requested appointments or used the telephone more frequently or the complexity of enquiries involved once the change was implemented. So she interpreted the information in these various reports gathered from the different organizations to better understand and take into account their specific environments. She combined the relevant information in a logical manner to address her organizational needs and connected all of the main factors to help her build a good plan.

To project the staffing needs required for the new delivery model, she estimated there would likely be a 15 to 20 percent decrease in workload since she reasoned that the former counter clients would simply not take the time to request an appointment and appointments would likely deal primarily with more complex enquiries. She also identified other potential tasks in the office where staff could be utilized if the workload decreased more significantly than her projection. In line with the funding available, she proposed a detailed plan for the new organizational structure to support the service delivery model, including costing, staffing requirements, and schedules. She presented her plan for approval to her Assistant Director.

Problem Solving level 4
Underlying Notion Behaviours could include, but are not limited to:

Undertaking a broad analysis to resolve a multifaceted problem or situation

  • Identifies multiple causal relationships between factors that are not obviously related.
  • Formulates and systematically evaluates multiple strategies in order to determine the best course of action.
  • Draws conclusions or develops possible explanations using facts, general principles or concepts.
  • Develops a comprehensive and viable solution to a problem or situation that is comprised of many inter-related parts.

In other words, you may:

At this level, the complexity is high as there are many aspects of the problem or situation to take into account. This means that the problem or situation you are dealing with has multiple interconnected parts, layers, dimensions, or angles, which make it very complex and challenging to work through.

All those steps require a very high degree of effort to determine the best course of action and to develop an integrated and complete solution. The solution may be precedent-setting but that is not an absolute requirement.


A large file case auditor examined an issue related to foreign accrual property income (FAPI) for a controlled foreign affiliate of a Canadian bank carrying on reinsurance business in another country. She determined that although the controlled foreign affiliate was carrying on an active business, it had excess funds that were not required in carrying on its active reinsurance business. The income earned on these excess funds would be subject to FAPI and immediately taxed in the hands of the Canadian bank.

The auditor researched jurisprudence related to concepts and principles about assessment of FAPI. According to the jurisprudence, the threshold test was whether the withdrawal of the property would have a destabilizing effect on the corporate operations themselves. She also conducted a quick survey with industry specialists to validate her findings. The specialists acknowledged it was difficult to establish an excess funds amount because of the highly specialized and complex nature of the industry. Looking back into the taxpayer’s file, they had funds of 500% which they said was equivalent to the industry average. The auditor had to determine if this was in fact the industry average as the Office of Superintendent of Financial Institutions requirement was a minimum of 150%, but she was not able to obtain from the actuaries a detailed proof.

The auditor looked for extracts of financial statements for reinsurance companies in the United States and Europe so that she could do a comparison of the ranges for the capital requirements for actuarial liability. In completing this review, she elaborated some possible explanations, such as whether those companies were keeping the capital for reasons other than meeting actuarial liabilities and whether a mature company would retain as high a percentage of capital. She also wondered about the possibility for expansion of the controlled foreign affiliate. She used that scenario to estimate a percentage of capital required to fund a probable expansion possibility. This kind of situation had never been examined previously, so there were no guidelines to follow; she was blazing a new trail. With the many steps she took and the information she gathered from various fields, she was able to build an integrated solution that was not only resolving Canadian tax issues but also those with other countries. She documented her argumentation to discuss her conclusions with specialists in that field even though the detailed actuarial reports were not available. Her solution set the benchmark for future files of that nature.

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