Fm ws report


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  • Host project/ logistics – SHOMAP Draft ppt – Robert (RFP, ZM)/ Farida + Grace (CAAIP, UG)
  • To put the portfolio into context….. The top 3 countries: Ethiopia Uganda Tanzania 16 out of 21 countries in region borrowing, Botswana to make 17. 53 projects – 49 highly concessional terms. 11% in grants, up from 2% 3 years ago
  • Increase in portfolio size of 19% from 2009 Significant increase in 3 year country programme for 2010-2012 (45%/ USD 197m) 59% Agricultural Development/ Rural Development, increase in rural development and marketing projects Fewer, larger investments – average financing size $17.2m – $19.9m 5 new projects and 5 supplementary loans in 2009/10 totalling $219m Average project life – 7.6 years. Oldest – 13.5 yrs (VODP) – shortest 5.1 yrs (8003KM)
  • TZ SWAp – $26.4m (32% increase without TZ SWAp) TZ – 26% disbursements Highest flows in project (excl SWAps) – NAADS ($9.1m) Improvement: bolstering of resources in Nairobi loan admin hub fruits of capacity building with project teams more familiarity with CPMs and assistants Key role by Country Offices, above all where quality checks are conducted at in-country prior to dispatch to Nairobi, such as in Madagascar Best performing country in terms of quality and speed of processing WAs – MG MG – 91 WAs KE – 87 RW - 86 Rwanda showed the most improvement in terms of WA quality and adherence, attributable to proactive project staff and close monitoring by the CPM. Burundi, Eritrea and Kenya also noted good quality submissions. On the downside, Mozambique showed long processing times, due to delays in processing the two SWAp WAs submitted in the period, and also associated with the special account reconciliation issues noted for the 622-MZ, which have now been resolved. The Tanzania SWAp similarly suffered from delays in the one annual disbursement from the three associated loans, held up by discussions with Finance about whether underlying disbursement conditions had been satisfied. Disbursement delays in Comoros were caused by inadequate understanding of the replenishment requirements by project staff. Training has now been carried out and the project is beginning to gain momentum. Common issues: Reconciliation of Special Account WAs not fully supported Problems understanding the mechanism for grants – based on justification of the 75% of the advance & subsequent year’s AWPB Exchange Rate issues Using the wrong forms Delays in responding to queries, submitting WAs with unsigned SOEs, using wrong forms especially summary sheets, etc
  • Accounting packages 10/42 projects use spreadsheets 60% of projects with accounting software use TOMPRO
  • Merge national requirements + IFAD minimum fiduciary disclosures so only one set of reporting and audit performed
  • Regional FM resource packs – hard copy/ pendrives
  • 2010 portfolio review – fiduciary ratings – subjective Financial management Disbursement rate Counterpart funds – best performing area Compliance with Loan covenants Procurement – 2 nd worst Audit - worst
  • 2010 portfolio review – fiduciary ratings – subjective Financial management Disbursement rate Counterpart funds – best performing area Compliance with Loan covenants Procurement – 2 nd worst Audit - worst
  • Fm ws report

    1. 2. Background to the Workshop <ul><li>Objective of workshop </li></ul><ul><li>To upgrade fiduciary capacities & facilitate exchange of experiences & best practices in the implementation of projects </li></ul><ul><li>This was in response to requests by project implementers </li></ul><ul><li>Coverage </li></ul><ul><li>Fiduciary issues of loan administration, financial management, procurement, audit & accounting </li></ul><ul><li>Sharing of best practices from projects (BI, KE, MG, UG, ZM) to enable replication </li></ul><ul><li>Participation </li></ul><ul><li>Overwhelming! </li></ul><ul><li>128 staff from 14 countries, including staff from ministries, auditor general (SAI), projects, IFAD country offices & HQ (Rome) </li></ul>
    2. 3. Background to the IFAD ESA portfolio ESA Loan & DSF Grant Portfolio
    3. 4. Background to the IFAD ESA portfolio ESA Portfolio by type
    4. 5. Background to the IFAD ESA portfolio Disbursements 2009/10 - USD 121 million (36% increase)
    5. 6. Financial Management <ul><li>Accounting systems   </li></ul><ul><li>Computerization assists effective/ timely reporting </li></ul><ul><li>Reporting </li></ul><ul><li>Financial management reports : sources & uses of funds for period + cumulative by category + component, assets, commitments, inputs + outputs </li></ul><ul><li>Physical progress reports : link outputs to related costs </li></ul><ul><li>Procurement reports : compares actual with plan & status </li></ul><ul><li>Tips </li></ul><ul><li>Implementation manual - to be used as guide & reference </li></ul><ul><li>Regular back up and filing </li></ul>IFAD has a fiduciary role to ensure that its funds are used for the purpose for which intended
    6. 7. Annual Financial Statements <ul><li>Project Financial Statements include: </li></ul><ul><ul><li>Statement of sources & use of funds </li></ul></ul><ul><ul><li>Cash Flow Statement </li></ul></ul><ul><ul><li>Schedule of Withdrawal Applications </li></ul></ul><ul><ul><li>Statement of Special account & Reconciliation </li></ul></ul><ul><ul><li>Status of Funds/ Financing </li></ul></ul><ul><ul><li>Fixed assets schedule </li></ul></ul><ul><li>Accounts should be prepared in accordance with best practice - internationally accepted accounting principles (IPSAS or IFRS), using cash or accruals basis </li></ul><ul><li>National systems to be used where possible </li></ul>
    7. 8. Audit <ul><li>Purpose: </li></ul><ul><li>Provide accountability, verify compliance & make recommendations </li></ul><ul><li>Key points:   </li></ul><ul><li>Audit can be conducted by Supreme Audit Institution or private audit firm approved by IFAD </li></ul><ul><li>Audit report to be submitted within 6 months of fiscal year end </li></ul><ul><li>3 Audit opinions to be provided on the Financial statements, the Special Account & Statements of Expenditure </li></ul><ul><li>To include a management letter with details of weaknesses in internal controls and non compliance </li></ul><ul><li>Failure to submit within 180 days after due date or unsatisfactory report will lead to suspension of funding </li></ul>
    8. 9. Background to the IFAD ESA portfolio Assessment of 41 Audit Reports received: 1 July 2009 - 30 June 2010
    9. 10. Procurement <ul><li>Purpose: </li></ul><ul><li>To establish an effective procurement system that leads to improved procurement performance </li></ul><ul><li>This can be achieved by: </li></ul><ul><ul><li>Preparing a procurement plan before start of financial year & submit to IFAD for No-objection </li></ul></ul><ul><ul><li>Finances to be used for only items in the procurement plan & provisions of financing agreement </li></ul></ul><ul><ul><li>IFAD procurement guidelines to be followed & all steps adhered to </li></ul></ul><ul><ul><li>Plan in advance - consider whether prior or post review applies & act accordingly </li></ul></ul><ul><ul><li>Contract management is key </li></ul></ul>
    10. 11. Other areas discussed <ul><li>Annual work plans and budgets </li></ul><ul><ul><li>Critical setting of AWPB to ensure milestones met </li></ul></ul><ul><ul><li>Monitoring to ensure steady progress & performance </li></ul></ul><ul><ul><li>Value for money leads to higher impact from resources </li></ul></ul><ul><ul><li>Ensure adequate cashflows + anticipates gaps by planning </li></ul></ul><ul><li>Loan administration </li></ul><ul><ul><li>Financing Agreement/ LTB – critical documents </li></ul></ul><ul><ul><li>Special account reconciliations, Exchange rates </li></ul></ul><ul><ul><li>Loan closure procedures </li></ul></ul><ul><li>Challenges faced by particular projects in implementation </li></ul>
    11. 12. FM Tools & Resources <ul><li>FM&GG Internet site: </li></ul><ul><li>English : </li></ul><ul><li>French: </li></ul><ul><li>Withdrawal Application Tracking System (WATS) </li></ul><ul><li> </li></ul><ul><li>Group PC/ Accountants mailing lists – updated names to </li></ul><ul><li>2010 </li></ul><ul><li>Revised Procurement guidelines </li></ul><ul><li>ARTS (Audit Report Tracking System) </li></ul><ul><li>2010/11 </li></ul><ul><li>Regional FM resource packs </li></ul><ul><li>Revised Loan Admin procedures </li></ul><ul><li>Revised Audit Guidelines </li></ul><ul><li>2012 </li></ul><ul><li>New Loans & Grants system </li></ul>
    12. 13. Key success factors <ul><li>Project management – single most important determinant of project implementation results </li></ul><ul><li>FM Workshop test highest results </li></ul><ul><li>Farida Mukungu (CAIIP, Uganda) </li></ul><ul><li>Randrianarimanana Mamitiana (Ad2M, Madagascar) </li></ul><ul><li>Zaki K Juma (ASSP/ASDP-L, Zanzibar) </li></ul><ul><li>Clear correlation between projects with high fiduciary ratings and overall implementation progress </li></ul><ul><li>2010 Portfolio performance review – highest fiduciary ratings </li></ul>
    13. 14. Fiduciary best practices <ul><li>Centralised country control unit </li></ul><ul><li>Use of external services firm </li></ul><ul><li>Additional missions and support </li></ul><ul><li>Internal auditor </li></ul><ul><li>Country finance & procurement working group </li></ul><ul><li>Standardised country rules, procedures, training </li></ul><ul><li>Review of authorised allocations & thresholds </li></ul><ul><li>Proactive staff to accelerate procurement processes </li></ul><ul><li>Reliable computerised financial systems </li></ul><ul><li>Regular (quarterly) reporting </li></ul>
    14. 15. What next? <ul><li>Lessons learned </li></ul><ul><li>Better efficiency + effectiveness in fiduciary matters = increased implementation results </li></ul><ul><li>Many best practice examples exist in IFAD projects </li></ul><ul><li>Greater exchange of experiences should occur </li></ul><ul><li>Make use of IFAD tools & resources </li></ul><ul><li>Future FM workshops </li></ul><ul><li>When, where, how often, how to finance? </li></ul>
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