Ethiopia(MoFED) Introduction

Ethiopia(MoFED)
East AFRITAC (IMF) and World Bank
Regional Workshop
On
Integrated Financial Management Systems
February 15-17,2010
Mombasa, Kenya
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Introduction
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To meet the government policy of implementing the accounts and budget reforms nation wide
and use the new information communications technology(ICT) infrastructure, the government
specified that the Budget Information System(BIS) / Budget, Disbursement and
Accounts(BDA) systems will be upgraded in to the Integrated Budget Expenditure(IBEX)
System.
Since 1998 EC.(2006 GC.) IBEX(Integrated Budget and Expenditure System) has began it’s
operation by the budget module then after the other 5 modules added to the system i.e
– Accounts
– Accounts Consolidation
– Budget Control
– Budget Adjustment
– Disbursement
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What Is IBEX ?
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Is an integrated budget and accounts financial application.
That provide the framework for core public financial management functions
It Combines what were two previously separate applications called Budget Information
System(BIS) and Budget, Disbursement and Accounts(BDA).
An upgrade of BIS/BDA
Is access through a web browser such as Internet Explorer.
Deployed in two configurations:
– Server – The distributed configurations exists as a mulit-user IBEX system that will be
installed in centralized location (usually the regional financial center) and will serve a
browsed-based application to all client that are connected to the server on LAN network
– Standalone – Replace the non-networked installation of BIS/BDA systems
As replacement to the BIS/BDA desktop application
– IBEX and BIS/BDA coexists
– BIS/BDA as standalone versions
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Technical Platform
• Integration
– Functional Integration
- Single data warehouse
- Single user interface and user security system
– Transactional Integration
- Distributed(web based)
- Real time transactionality
- Limited only by available communication infrastructure
– Procedural Integration
- Integration with existing automated and manual process
• Security
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Prevents unauthorized access to all system and data
Secured through a third-party security application(SiteMinder), Active directory, and a
custom security framework.
User based / role based security
Network security
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Technical Platform (Contd)
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Scalable
– Ease to support and upgrade
– Grows easily to serve additional users and location
– Platform flexibility (Grows as telecommunication infrastructure grows)
Extensible
– Easy to develop and plug-in future non-core function.
– Easy integration with external systems.
Internationalized
– Supports multiple languages and cultural locales.
– Can operate in any language. Currently operate in four language(Amharic, English,
Tigrigna and Oromiffa).
– Support two calendars(EC and GC), Multiple currency types etc
DataData-Loss Prevention (Backup system)
– Daily backups can be taken on disk.
– Full backups should be taken on tape, with the last backup of the month being archived.
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Functional Modules
• Current modules (core modules)
– Budget Module
• This module executes all the budget preparation activities performed by
government financial offices.
– Account Module
• This module executes all the budget execution activities of government
budgetary institutions. More specifically, the accounts module records the
financial transactions of the budgetary institutions, records the aggregated
monthly accounting reports and provides accounting reports for ledgers,
financial statements, management reports, transactions, expenditures and
revenues.
– Budget Adjustment Module
• This module provides the functionality to address changes to the approved
budget during budget execution. It specifically enables the recording of
budget transfers and budget supplements and the subsequent production of
the adjusted budget.
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Functional Modules (Contd)
– Budget Control Module
• This module manages the activities of recording budget commitments and disbursement
payments in order to enable budgetary control over expenditures.
– Account Consolidation Module
• This module consolidates the budget and accounting data for the entire country. This module
allows for the generation of regional and national consolidated reports.
– Disbursement Module
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This module manages the public treasury functions associated with cash management and
disbursing funds between public financial institutions.
– Administration Module
• This module provides an interface to manage users and user’s profiles that interact with the
IBEX system..
– In general IBEX is not a system for an auditor general to perform their
own task, but they can get raw data from the system for their analysis
and verification purpose.
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Reporting
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The system can generate accurate and on-time report
All IBEX modules leverage a standard reporting framework that allows for the relatively
rapid creation and addition of reports.
All reports allow for pre-defined selection / filtering criteria which vary from report to report.
All reports are available in one or more of the following formats:
– HTML(On Screen)
– Microsoft Excel®
– Microsoft Word®
– PDF (Adobe Acrobat)
Reports will be presented to the user depending on what functional area they are working in
and their authorization level.
IBEX greatly simplified the process of creating additional reports for any of the modules it
contains
In Addition because of the unified (Integrated) data store, cross-functional reports that
leverage data from multiple functions can be created.
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Migration Tools
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Components integrated into the IBEX system to facilitate the simple, electronic migration of
data between systems (standalone & distributed) at key procedural points during the fiscal
year.
• Budget submission
• Budget Notification
• Monthly Reporting
• Budget Adjustment Submission (JBAR requirement)
• Nationwide Accounts Consolidation
Two types of migration tools
– Legacy System Migration tools
• Migrate data between BIS/BDA systems and IBEX systems
– IBEX to IBEX Migration tools
• Migrate data between two IBEX systems (typically standalone and distributed)
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IBEX Implementation Statusb
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IBEX has now been implemented and is use in all regions (We have 11 Regions)
BOFED users connect to IBEX using the local BOFED LAN
Users at Zones and Weredas connect to IBEX via:
• ETC’s Terrestrial Network (Leased Line)
• WeredaNet VSAT network
• Local IBEX standalone installations (Zones and Federal Public Bodies only)
– Standalone installations will use data migration utilities to synchronize their data with the
BOFED IBEX server
MoFED / Federal
- Budget , Accounts and Disbursement in MoFED
- Ibex is implemented in 165 Federal Reporting Unit
Oromia
– Budget , Accounts Disbursement in BoFED
– Budget and Accounts in All zones
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IBEX Implementation Status(contd)
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Amhara
– Budget , Accounts Disbursement in BoFED
– Budget and Accounts in All zones
SNNPR
– Budget , Accounts Disbursement in BoFED
– Budget and Accounts in 13 zones and 4 special wereda
Tigray
– Budget , Accounts Disbursement in BoFED
– 10 sectors on weredaNET
– BIS / BDA in 43 weredas
Addis Ababa
– Budget , Accounts Disbursement in BoFED
– All sub-cities connected over a WAN
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IBEX Implementation Status
(contd)
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Benishangul
– Budget , Accounts and Disbursement in BoFED
Dire Dawa
– Budget , Accounts Disbursement in BoFED
Harrari
– Budget , Accounts Disbursement in BoFED
Afar
– Budget , Accounts Disbursement in BoFED
Gambella
– Budget , Accounts Disbursement in BoFED
Somali
– Budget , Accounts Disbursement in BoFED
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Control system
IBEX has designed to control the process of every core transaction and generation of
reports in a manner of which will not expose the government to unnecessary
risks like :
– Disbursement over budget
– Controlling accounts( payable and receivable) check equality with their
own respective subsidiary ledgers
– Cash flow forecast over budget
Challenges of the system
• Its too slow in processing
• It might stack through processing
• It is browser dependent( it works only in internet explorer 5.5 and above)
• It is platform dependent (it works only XP sp2)
• For different region they use different installation package , its difficult to treat
centrally this could cause problems when consolidation or aggregating data
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Thank You
For Your
Patience
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MALAWI GOVERNMENT
CHALLENGES AND SUCCESSES IN THE
IMPLEMENTATION OF THE INTEGRATED
FINANCIAL MANAGEMENT INFORMATION
SYSTEM (IFMIS)
ACCOUNTANT GENERAL’S DEPARTMENT
2.0
THE INTEGRATED FINANCIAL MANAGEMENT
INFORMATION SYSTEM
2.1
Introduction
In 1995 the Government of Malawi undertook a reform of its
Public Financial Management (PFM) system with a view to
integrate planning, budgeting, and accounting processes.
The project was financed by the World Bank and implementation
started in 1996.
Activities included:
•A detailed review of the chart of accounts.
•Customization of the system.
2.2 Objectives of the IFMIS
a. To improve and strengthen public expenditure
management with a view to bring about fiscal discipline
b. To integrate all accounting modules including the budget
module
c. To provide the Government of Malawi with an upgraded
and state of the art computerized accounting system
d. To ensure that other sub systems are properly interfaced
with IFMIS
e. To assist in the production of timely and reliable financial
data.
3.0
The Project
In May 2005, Malawi Government adopted & implemented an
EPICOR based IFMIS.
In July 2005, Contract was signed with Soft –Tech
Consultants - Tanzania to supply Epicor software and assist
in the implementation of IFMIS in Malawi
Under EPICOR based IFMIS, Government decided to
streamline its payment system.
Government then opened five Bank Accounts in Reserve
Bank of Malawi and closed all operating bank accounts in the
Commercial Banks
However, accounts for Donor funded projects, Treasury funds
and Local Assemblies were not closed then.
3.2 Implementation Status
The retail functions were undertaken by three Banks
namely Standard Bank, NBS Bank & Malawi Savings Bank
Implementation started in November 2005 with five sites
being online namely, Education, Agriculture, Health,
Treasury and the Accountant General’s Department.
In April 2006, Government procured new equipment
whose installation was completed in May the same year.
By the end of July 2006, all ministries and departments
were connected to the server farm at the Accountant
General’s Department, except regional offices and
independent sites which include Malawi Police, State
House and the Malawi Defence Force.
4.0
FUNCTIONALITY OF EPICOR
Epicor, like many other accounting systems, has the following
modules.
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General Ledger
Accounts Payable
Accounts Receivable
Purchasing Order Processing
Cash Management
Multi Currency Manager
Inventory Management
Quality Control
It also has Intelligence Explorer, a tool mainly used for producing
Operational reports, e.g. a report listing payments made
on a particular day.
User rights of this tool are assigned to senior officers
5.0
SUMMARY OF CONTROLS IN EPICOR BASED IFMIS
5.1
BUDGETARY CONTROL
The system prevents Treasury from release of funding beyond
Budget provision.
5.2
COMMITMENT CONTROL
Before allowing any expenditure, commitment control checks
funds committed in Cash Management, Accounts Payable and
General Ledger.
5.3
CASH CONTROL
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The system prevents users from making payments beyond
the available balance in the Cash/Bank Account
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When printing cheques, the system checks the cash balance
in the selected Cash Account
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If available balance is insufficient to make payment, it does
not proceed printing the cheque
6.0
ACHIEVEMENTS TO DATE
6.1
i.
Fiscal Discipline has been achieved
ii.
The Project has built enough capacity to manage
implementation of IFMIS now and beyond.
iii. The MGDS have been incorporated in the budget through
the chart of accounts where a field for output based
reporting has been provided
iv. No backlog in bank reconciliation (timely reconciliation of
bank accounts, currently monthly but the objective is one
day in arrears)
v.
Timely production of Expenditure Reports and Annual
Appropriation Accounts
6.1 ACHIEVEMENTS TO DATE Cont’d
Sourcing of goods and services is from pre-qualified
suppliers only thereby eliminating ‘brief case’ suppliers.
The system has reduced congestion in processing and
payment of pensions and gratuities.
Budget Module (Active Planner)
The system is now interfaced with Active Planner (Budget
module).
(i)
(ii)
7.0
The Disaster Recovery Site (DRS) The AGD has
established a DRS which is fully operational.
Connectivity between the main site and DRS is through
fibre connection installed by MTL. Data synchronization is
on real time.
CHALLENGES
Interface with other subsystems such as Human Resource
Management Information System (HRMIS
(HRMIS)) and Debt
Service.
The problem of power blackouts.
blackouts.
Connectivity Problems.
Problems. Government Wide Area Network
(GWAN)
GWAN) is limited only to Government buildings
Change Management. The move from manual to an
automated system was and is still challenge. Adapting to
new roles, responsibilities, and procedures was met with
skepticism and resistance. Through training, meetings,
workshops and streamlining of functions, the system has
so far gained reasonable acceptance.
8.0 Lessons Learnt
a)
For IFMIS to be successfully implemented, there should
be strong political will, to reform its financial
management activities.
b)
Support from all key stakeholders
c)
Civil servants occupying regular positions in Civil Service
should be given the challenge to implement the project.
The practice of outsourcing personnel from the private
sector with different salary structure should be
discouraged as it brings in some misunderstanding.
d)
There should be strong and dedicated Project Team.
The team and End Users should be well trained.
e)
Use of foreign experts should be limited to areas where
expert knowledge does not exist government realm.
9.0
Conclusion
IFMIS projects worldwide face a lot of challenges
and frustrations and therefore require strong
commitment from staff as well as support from
Senior Management/Policy makers. It is pleasing
to observe that in Malawi, IFMIS has received
strong support from Senior Management/Policy
makers and high level commitment from
implementing staff.
East AFRITAC (IMF) and World Bank
Africa Regional Workshop
On
Integrated Financial Management Systems
February 15-17, 2010
Serena Hotel
Mombasa, Kenya
Sierra Leone’s experience with IFMIS
Off-the-shelf Software
Giba Koroma
Senior Financial Management Specialist
Public Financial Management Reform Unit
Ministry of Finance and Economic
Development
Objective
• The objective of this presentation is to share
Sierra Leone’s experience with IFMIS design
and Functionality.
Contents
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Basic Facts about Sierra Leone
Background to IFMIS
Design and Functionality
Implementation Arrangement and Status
Funding
Related Reforms
Challenges
Next Steps
Basic Facts about Sierra Leone
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Population: 6 million
Capital: Freetown
Area: 72,300 sq km
Neighbours: Liberia and Guinea
Major languages: English, Krio
(Creole language derived from
English), Mende, Temne and a range
of other African languages
Major religions: Islam and
Christianity
Life expectancy: 39 years (men), 42
years (women) (UN)
Monetary unit: 1 Leone = 100 cents
Exchange rate: $1/Le4,100
Main exports: Diamonds, rutile,
cocoa, coffee, fish, bauxite
GDP: Le 6,711 bn
Internet domain: .sl
International dialing code: +232
BACKGROUND TO IFMIS
• The Previous Financial Management Accounting System
showed a number of features that warranted a change. Key
amongst these were
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Poor design
Non existence of Audit Trail
Lack of automated bank reconciliation
Non existence of Purchasing Module
Limited Security and Controls
Centralised at Accountant General’s Department
Limited Generation of Relevant Reports
• These triggered the need for an integrated FMIS
Design and Functionality
• The Package (FreeBalance) was acquired off the shelf, with
very little customisation in consultation with relevant players
• System covers key areas of Government Operations
• Other Charges- Expenditure Management
• Purchasing/Procurement
• Appropriations/Budgeting
• Human Resource Management
• Fixed Assets
• Inventories
Design and Functionality Cont’d
Core Considerations
– Based on World Bank Treasury reference model
– Windows based skills , user friendly, seamless interface with other
packages (Bank of Sierra Leone)
– IFAC (Cash accounting)
– IMF-GFSM 2001
– Project Management- Prince2 Methodology
• Modules
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Controls
Appropriations
General Ledger
Expenditures
Purchasing
Revenues
Assets
Treasury Management
Human Capital Accountability (HCA)
Performance Budgeting
SIMMS/Inventory
Design and Functionality Cont’d
• Controls Module- System Administration
• Performance Budgeting
Budget Bureau
• Appropriations
• General ledger
Accountant General’s Department
• Treasury
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Expenditures
Purchasing
Assets
SIMMS/Inventory
All Rolled Out MDAs
• HCA – AGD, HRMO, SLP
Design and Functionality Cont’d
• Chart of Accounts
–Based on 27 Digits Chart of Accounts (11 in
FMAS) covering Five segments
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Organisation/Ministry Department/Agency (7 Digits)
Fund (3 Digits)
Program/Project (8 Digits)
Location (5 Digits)
Object of Income/Expense (4 Digits)
• Contains side Tables in respect of MDGs,
GFS, COFOG
Chart of Accounts Segments
Segments
Organization
Fund
Program/Project Location Object
Chart of Account Tables
Organization Segment
Organization Type
(1)
Sector (1)
MDA / Councils
(3)
MDA Reporting
Groups (2)
Division / Departments
(5)
Cost Centers
(7)
Chart of Account Tables
Fund Segment
All Funds
(Consolidated, Councils, Donors)
General Government (1)
(Consolidated & Councils, Donors)
Source Type Table (1)
(CF, Grant, Loan, Councils)
(Consolidated, Departmental, Councils, Donors)
Source group (3)
Fund Source Table (3)
(CF, WB1 (Local+Frgn), Councils)
Donor Type (1)
Fund Table (1)
(CF,CF-MDA1, WB1-Local, WB1-Foreign, Council 1)
Donor Table (3)
Fund Segment
• The Fund Table has values for CF, Councils and
Donors. This provides for multiple entities in the
Fund Source Table. The donor agreements are
grouped (e.g WB, EU etc.) in the Donor Table.
• The Fund structure provides Financial Statements
for individual MDAs, Councils & Donor
Agreements; separate consolidated statements for
CF, Councils and Donors; separate consolidated
statements for the General Government & Donors;
and a consolidated statement for all funds.
• Donor Type Table groups Multilateral & Bilateral
Agreements.
Chart of Account Tables
Program / Project Segment
Project
MDG
(2)
PRSP
Thematic
(2)
PRSP Pillars
(1)
(NA, Projects, WB1,
EU1 etc. )
PRSP Objectives
(3)
Component
(4)
(3)
Priority
(1)
PRSP Activity
Group
(3)
Activity Group
(3)
PRSP Activities /SubComponent
(6)
Activities
(8)
Project Type
(1)
GFS Function 1
(3)
GFS Function 2
(4)
GFS Function 3
(5)
Program / Project Group
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The benefit of extra flexibility by having
separate segments for Program and Projects
was sacrificed for simplicity and to avoid extra
data entry.
• Having one segment from Program and
Projects results in the following Constraints
– Project Sub-Components and Activities can
be associated with only one PRSP Program
Objective
– Separate Activities will need to be defined
for each PRSP Program Objective
Chart of Account Tables
Location Segment
Province
(1)
Districts
(2)
Chiefdoms
(4)
Wards
(5)
Chart of Account Tables
Object Segment
Account Type Table
(1)
Main Category
Table
(1)
GFS L1
(1)
GFS L2
(2)
Category Table
(1)
Sub-Category Table
(2)
Expenditure Type
Item Group (2)
GFS L3
(3)
(Revenue, Recurrent,
Development) (1)
(IT, Sales Tax,
Personnel, Other
Rec.Std, Capital,
Development)
Expenditure Sub Type
GFS L4
(4)
Object Group (3)
GFS L5
(5)
Object Code (4)
(Revenue, Recurrent,
Capital, Development) (2)
Financial Coding Structure
Annual Budget
(Control 1)
Quarterly Ceiling
(Control 2)
Quarterly Allocations
(Financial Budget)
General Ledger
(Commitments,
Expense,
Revenue &
Journal Entry)
Segments
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Cost Center
(7)
Fund Source.
(3)
Division / Dept.
(5)
Fund Source
(3)
Cost Center
(7)
Fund Source
(3)
PRSP Activities / Sub Comp
Cost Center
(7)
Fund Source
(3)
Organization
Fund
PRSP Activities / Sub Comp
(6)
(6)
District
(2)
Object Code
(4)
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Category
(1)
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District/Chiefdom Object Code
(4)
(4)
Activities
Ward
(8)
(5)
Object Code
(4)
Program / Project
Location
Object
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Design and Functionality Cont’d
• Reporting
– Off the shelf Reports covering the various modules are
available
– The Reports are customized using crystal reports writer
– Typical Reports
• Appropriations (Allotment, Budget, Commitment)
• General Ledger (JVs, Trial Balance, Balance Sheet, Income Statement
GL)
• Expenditures (Expense voucher, Payables Controls)
• Purchasing (Requisition, Purchase Order, Goods Received/Returned)
• Revenue Reports (Various Accounts Receivable Reports)
• Side Table (Donor Expenditure Groups, Object Type, GFS, COFOG,
MDGs)
• Assets (General Inquiry, Item List, Audit Trail for Deletions)
• Full Audit Trail
Design and Functionality
• Budgeting and Execution are done on the basis of
the 27 Digits chart of Accounts Elements hence the
availability of respective reports on the Modules.
• Reports are also available on the respective side
tables’ elements- MDGs, GFSs, COFOG
• The Poverty Reduction Strategy Paper is contained
in the Program project Segment, this segment is
linked to the MDGs and COFOG
• The Object Segment is linked to the GFSs as
contained in IMF GFSM 2001
Design and Functionality Cont’d
• The availability of Budget Presupposes execution of
transactions- Revenue/Expenditure
• Local Purchase Orders are issued based on Budgetary
provisions
– Prompt reconciliation of all bank accounts centrally controlled by
AGD
– Human Capital Accountability Module of IFMIS used to process
payroll of GoSL employees
– Removal of backlog of financial statements
– Existence of full Audit Trails
– Timely preparation of Annual Accounts in line with provisions in
GBAA 2005 hence timely completion of Audits
Corporate Programme Management
Minister of Finance
Independent Oversight
The Auditor General
Project Steering Committee
Senior Users
Accountant General
Budget Director
Establishment Secretary
Project Assurance
1. Independent firm
Executive
Financial Secretary
Senior Supplier
FreeBalance
PFM Reform Unit
Project Sponsor
World Bank
Project Management
Head PFM Reform Unit
2. Ministry of Health
Team Managers
Project Support
IT Specialists
FM Specialists
IT Programmers
Configuration Librarian
IFMIS Organisational Structure –PFMRU-IRCBP
Design and Functionality Cont’d
• Functionality Benefits:
–Up to date preparation of yearly financial
statements for Government of Sierra Leone – 3
months after year-end in compliance with the
Government Budgeting and Accountability Act,
2005
–Regular publication of in-year outturns in
national gazette
–Reduction in Government arrears seen through
use of the Purchasing Module
Current- Implementation and Oversight
Arrangements
Implementation Status
• Financial Management Information Systems
– Went Live on 1 June 2005 at the AGD- All vouchers
processed by the AGD through IFMIS
– IFMIS installed in Accountants General’s Department (AGD)
and rolled out to 10 line ministries. This covers
approximately 65% of government’s expenditures being
processed real-time through the IFMIS rolled out ministries
– Expenditure vouchers for all non-rolled out ministries
processed through the IFMIS by the AGD
– All Rolled Out Ministries Using the Purchasing Module
issuse Local Purchase Orders
– The Records component of HCA Rolled out to the SLP and
HRMO
– IFMIS piloted in one World Bank Funded Project
(Institutional Reform and Capacity Building Project)
Related Reforms
• The Legal Framework
–Government Budgeting and Accountability Act,
2005
–Financial Management Regulations, 2007
–Public Procurement Act, 2004
–Procurement Regulations, 2006
–Local Government Act, 2004
–National Revenue Authority Act, 2003
–Finance Act 2009
Funding- IPFMRP
• Implementation up to May 2009 has been
largely funded by the World Bank.
• Funding is continuing through the Integrated
Public Financial Management Reform Project
supported by
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Government of Sierra Leone (GoSL)
World Bank (WB)
European Community (EC)
Department for International Development (DFID)
African Development Bank (AfDB)
Funding-IPFMRP
• Project Development Objective
“Sustainably improving the credibility, control and
transparency of fiscal and budget management”
– Pooling of all support for PFM reform within one project
enhancing coordination
– Component 1 -Strengthening Macrofiscal Coordination and
Budget Management
– Component 2 – Reinforcing the Control System for
Improved Service Delivery
– Component 4 – Assisting Non-State Actors’ Oversight
– Component 5 – Project Management
IPFMRP
• Component 3 – Strengthening Central
Finance Functions
– Expected Outcomes various cross-cutting
activities undertaken, including IFMIS rollout,
training and human resource (HR) capacity
development for PFM functions; sustainable HR
capacity in the MoFED
– The PFMRU is now located in the Ministry of
Finance & Economic Development.
– An ICT Committee comprising of amongst others
Director PFM Reforms, Accountant General,
Director ICT oversees IFMIS.
Challenges
• Funding following the end of IPFMRP
• Capacity- Building and Sustainability
• Power Supply- Being addressed
• Payroll verification- HCA
• Technical Infrastructure
• IFMIS Disaster Recovery and Business site
Next Steps
• Roll out Foundations and Purchasing Modules to Office of
Vice President and Cabinet Secretariat by April 2010
• Roll out to 2 more Ministries by end 2010
• Roll out HCA (excluding payroll portion) Ministry of
Education, Youths and Sports and the Ministry of Defence
by end 2012
• Continue implementation arrangements for Integrating
Commonwealth Secretariat Debt Recording and
Management Systems with IFMIS by end of 3rd Quarter
2010.
• Continue Roll out of Petra Accounting Package to Local
Councils with full 27 Digits Chart of Accounts Elements
• Conversion of Contract Staff into Civil Servants (work in
progress)
Next Steps cont’d
• Completion of Bumbuna Hydro and other related projects
in the Rural Areas.
• Establishment of IFMIS Disaster Recovery and Business
continuity site
• Pursuing Payroll verification with respective Ministries
• Full Implementation of PB Module
• Expedite Legal Reforms underway:
– Chiefdom Governance Policy and Act
– Decentralisation Policy, Revision of Local Government Act
and Related Regulations
– Revision of Public Procurement Act and Regulations
– Revision of Government Budgeting and Accountability Act
and Financial Management Regulations.
Thanks for your attention
Public Financial Management Reform Unit
MINISTRY OF FINANCE AND ECONOMIC DEVELOPMENT
www.mofed.gov.sl
Tel: (00) 232 22 222689
Mob: (00) 232 33 346 414
Government of The Gambia
INTEGRATED FINANCIAL MANAGEMENT
INFORMATION SYSTEM (IFMIS)
The Gambia Experience – February 2010
Momodou Lamin Bah – Project Manager
AREAS TO BE COVERED IN THE PRESENTATION
3/5/2010
CBackground & overview of the
Gambia IFMIS Implementation
C Governance Structures
CImplementation Approach
CSustainability & Skills Transfer
Approach
CIFMIS Benefits
CChallenges Faced
CNext steps – Phase II
Implementation
Background & overview of the Gambia
IFMIS Implementation
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The Case for IFMIS
IFMIS Procurement Process
IFMIS Definition and Scope
Technology Plan
3/5/2010
The Case for IFMIS
•
Like many developing countries The Gambia was faced
with the lack of accurate, timely and appropriate Budget
& Accounting Information and suffered from:
– Backlog of un-reconciled bank accounts
– Endemic Budget Overruns
– Lack of a comprehensive Chart of Accounts that
complied with GFS and International Public Sector
Accounting Standards
– Inadequate systems for collection and tracking of
revenue
– Backlog of audited final accounts
3/5/2010
IFMIS PROCUREMENT
•
•
•
The IFMIS Contractor was procured using World
Bank procurement guidelines;
Single stage bidding approach was used to
safeguard against future cost escalations- main
challenge with this approach is the need to
revalidate the bid prices if implementation timelines
are not adhered to;
Turnkey basis to ensure that the Supplier is fully
responsible for all deliverables on the Project and
for the management of all parties aligned with the
Supplier.
3/5/2010
Gambia IFMIS –Supplier’s Team
PRIME CONTRACTOR
JOINT VENTURE PARTNERApplication Software
LOCAL AGENT & SUB
CONTRACTOR FOR
HARDWARE, LAN&WAN
SUBCONTRACTORAccounting procedures
&Manuals
SUBCONTRACTOR- NAS.NET
PAYROLL MODULE
3/5/2010
Soft-Tech Consultants Ltd
Dar Es Salaam, Tanzania
Epicor Software Corporation
California, USA
QuantumNet, The Gambia
KPMG Ghana
HITS, United Arab Emirates
Gambia IFMIS Definition & Scope
•
•
•
The Gambia IFMIS is an Epicor ERP Software
Application that bundles together Budget
Preparation, Budget Execution, Accounting,
Payroll, Financial Management and Reporting
Activities.
It is integrated in nature as it ensures that data
entered at one point is electronically availed
to the next stage without duplication of data
entry activities.
An off-the-shelf package with approximately
20% customisation
3/5/2010
Gambia IFMIS - Modules
Asset
Manager
Asset
Maintenance
Inventory
Manager
Requisition
Manager
Quality
Control
Purchase
Order
Tender &
RFQ
Billing
Accounts
Receivable
Budget
Management
Payroll
3/5/2010
General
Ledger
Accounts
Payable
Cash
Management
Project
Management
Project
Planning &
Control
Gambia IFMIS Definition & Scope
•
Phase I implementation covered 6 sites:
–
Ministry of Finance and Economic Affairs – Undertakes core
functions on the system
–
Directorate of National Treasury – Undertakes core functions on the
–
Ministry of Basic & Secondary Education - Included due to size of
–
Gambia Revenue Authority – Included to ease the online sharing of
–
Personnel Management Office – Included in order to spearhead the
system
labour force and readiness for automation of processes
revenue data with Treasury via the use of a uniform chart of accounts
HR & Payroll implementation
–
National Audit Office- Included to ease the office’s IFMIS Quality
Assurance role & auditing skills.
3/5/2010
Technology Plan
•
We use a centralised data management &
monitoring approach.
•
The ministries/departments manage all entry
and security related to their data, but a
centralised Data Centre with specialised
resources are put in place (at DNT) to manage
the Database, Network, Backups, System
Administration roles, etc.
IFMIS Technical InfrastructureDatabase Management System
3/5/2010
CONNECTIVITY STRATEGY
•
•
Options:
– Private network infrastructure specifically
installed for IFMIS
– Third-party network infrastructure i.e. built and
supported by an ISP e.g. GAMTEL, QuantumNet,
etc
GoTG’s Choice
– Privately built network using fibre and wireless
– No recurring cost, although initial cost may be
slightly high
– Easy to deploy because of the size of the
country and nature of land topology
3/5/2010
IFMIS SECURITY & SERVICE
MANAGEMENT
•
Business continuity planning to address service
continuity
• Backup and recovery strategy
• Backup infrastructure (hot business continuity site
using log shipping technology)
•
IT security policy : Operational issues
•
•
•
•
•
Definition of roles and responsibilities
Virus protection
Privacy and confidentiality policy
Network security and access control
Environmental security i.e. temperature, electrical
3/5/2010
IFMIS SECURITY & SERVICE
MANAGEMENT
•
•
•
•
•
Automated Auditing Tool (DBAudit)
Access Controls for user authentication
– Both at Network and Application levels
Automated Helpdesk system (ITSM)
– Records and tracks incident calls
– Integrated with IFMIS system
Email facility for all IFMIS users (Intranet)
Email Alerts configured to user needs
3/5/2010
PROJECT GOVERNANCE
STRUCTURES: Project Team
•
Implementation is spearheaded by a strong team of
full-time consultants comprising of:
–
–
–
–
–
–
–
–
Project Manager
Financial Management Advisor
4 Financial Management Specialists
4 IFMIS Accountants
Data Centre Manager
Network Administrator
Database Administrator
3 IT Support Staff
3/5/2010
GOTG IFMIS Governance Structures
Hon. Minister
MOFEA
Project
Coordination and
Monitoring Role
CBEMP / MOFEA
IFMIS Steering Committee
Chair – PS/MOFEA
(IFMIS Leader)
IFMIS Project
Management Team
Chair – Director National
Treasury
(IFMIS Owner/Sponsor)
Quality Assurance
Advisor
NATIONAL AUDIT
OFFICE
GOTG
IFMIS
Project
Manager
IFMIS
Supplier’s
Project
Manager
IFMIS Implementation
Work Groups
3/5/2010
IFMIS IMPLEMENTATION
WORKGROUPS
• Training, Capacity Building,
Communication and Change
Management
• ICT & Site Preparation / Support
• Application Implementation
• Audit and Security
• Budget Implementation
• Human Resource (HR) Management
• Procurement & Contract Management
3/5/2010
Solution Design Approach/ Activities
•
•
New 30 Digit GFS compliant Chart of Accounts
(COA) developed
– In line with Cash Basis of Accounting, with
provision to migrate to Accrual Basis
– Improves comparability, best practice
compliance
Business Processes Jointly Reviewed with IFMIS
Supplier
– Based on GOTG technical requirements and
best practice
– Took advantage of Supplier’s experience
3/5/2010
Solution Design Approach/ Activities
• Regulatory framework reviewed
– To suit the deployment of an automated system
• Requirements Validation Document
Developed
– Blue print for IFMIS Solution
– Documented business process flows &
procedures
– Mapped End User roles to business processes
3/5/2010
Solution Design Approach/ Activities
•
•
Test Cases were defined for each business process
outlined in the RVD
Rigorous UAT carried out for each functionality
–
–
–
•
Test results documented and signed off by both GOTG and
Supplier
Only functionalities passing UAT deployed
Reports underwent similar rigorous testing
End Users involved in all Solution Design Activities
–
All end users involved in financial management are connected to the
IFMIS and assigned roles and responsibilities as per the business
processes; including the Minister of Finance and Permanent Secretaries
3/5/2010
Implementation Approach :
Restructuring of Bank Accounts
GOTG Operational Bank Accounts
 Consolidated Revenue Fund Bank Account (CRF)
 Treasury Main Account (TMA)
 Revenue Collection Bank Accounts for Ministries
and agencies
 Special Third Party Deposit Bank Account
 Special Project Bank Account
3/5/2010
Implementation Approach:
Commitment Control
– Commitment control on the IFMIS
ensures that before a local purchase
order or other commitment is entered
into, there are available funds which
are backed up by cash on the TMA via
approved cash allocations by the
Budget Directorate. An inbuilt check
also matches cash allocations against
the appropriated budget.
3/5/2010
Implementation Approach : Go-live &
Data Centre Arrangement
•
The IFMIS went live in Jan 2007, with pilot sites
processing their transactions online
•
A Data Centre was set up at DNT to process
transactions for the non-pilot sites. This meant
that GOTG could capture, process and
consolidate transactions for the entire
Government from the start. Management
reports are regularly submitted to the non-pilot
sites.
3/5/2010
Sustainability Strategy and
Skills Transfer Approach
•
•
•
•
•
•
•
Training
Application Core Team training
Technical Core Team training
End user training on basic IT, and IFMIS
modules
Government senior officials trained
Professional Accountancy and IT training
BSc in Accounting Degree course at UTG
Management training programs for middle and
senior managers at DNT
3/5/2010
Sustainability Strategy and
Skills Transfer Approach
Change Management & Sensitisation Seminars
– The Cabinet
– The National Assembly
– All Ministries, Agencies and Departments
– Top Government Executives
– Non Self-Accounting Projects
– Government Suppliers
– United Nations Agencies and Foreign Missions
– Regular sensitisation and communication via:
•
•
3/5/2010
•
Circulars, Posters and Presentations
Quarterly Newsletter, Frequently Asked Questions
Website updates (http://www.dosfea.gm)
IFMIS Benefits
IFMIS Benefits to-date include:
•
•
•
•
Minimisation of errors in transaction
processes
Achievement of a faster transaction
processing cycle
Achievement of a comprehensive
commitment control system - eradicating
budget overruns
An interlinked system of internal controls
providing clear audit trails and identification
of the originator for all transactions
IFMIS Benefits
IFMIS Benefits to date include:
•
•
•
•
Simplified and timely (automated)
reconciliation of bank accounts
Increased public /donor confidence.
Timely production of reports and financial
statements (2007 and 2008 accounts
produced from IFMIS). 2009 Accounts being
finalised
Budget Estimates produced from IFMIS
Challenges Faced
•
•
•
•
•
Operationalisation of eProcurement module
Operationalisation of Cash Plan and
Procurement Plan functionalities
Insufficient use of key reports by end users
Sustainability of IFMIS (retention of key
resources)
Major Data Centre Challenges
–
–
Risk of Errors and Forgeries
Inconveniences to the Non-Pilot Sites
3/5/2010
Next Steps – Phase II Implementation
•
•
•
•
•
Rollout of the IFMIS to 21 additional
Ministries/agencies – by December 2010.
Train end users on basic IT and IFMIS modules
Train senior government officials on basic IT
and IFMIS
Implement MTEF
Implement the following HR modules:
– Recruitment Management
– Training Administration
– Performance Appraisal Management
3/5/2010
Conclusion
•
Based on the foregoing, there is no doubt that the
IFMIS has contributed significantly to GOTG efforts
aimed at improving Public Financial Management.
•
This has been internationally recognised with:
– The Gambia being ranked among the best IFMIS
implementers in Africa.
– World Bank recommending other countries (Nigeria,
Liberia, etc) to understudy Gambia’s implementation
The Gambia looks forward to sharing experiences
with, and learning from, other countries implementing
IFMIS.
•
3/5/2010
END
THANK YOU VERY MUCH!
3/5/2010
Rolling out Financial Management
Systems to SubSub-national
Governments:
The Kenyan Experience
PRESENTATION BY SIMON LAPPER, TA, KLGRP
Regional Workshop On Integrated Financial Management Systems
February 15-17, 2010
Serena Hotel, Mombasa
LAIFOMS Objectives
LOCAL AUTHORITIES INTEGRATED FINANCIAL
OPERATIONS MANAGEMENT SYSTEM
• Greater compliance with laid down
procedures
• Standardization across the sector
• Improved database management
• Greater accountability
• Improved decision making
Background
•
•
•
•
2000 Started as a SBP module
2001 A receipting module added
2002/03 Miscellaneous revenue modules added
2004/05 commenced development of wider
information management system
• 2006 – redesigned all modules on to SQL
operating system
• 2006/07 commenced roll out to all LAs
Integrated System
LAIFOMS Implementation
Implementation
Methodology
• Stand alone LAN systems
• Phased Implementation Process - LAs selected
by ODPM & MoLG
• LAs provide own equipment and infrastructure
• Availability of equipment and IT officer
prerequisites for implementation
• Continuing system development
• Updates through website
• Support through TA team to KLGRP
Major Issues/Constraints
• Low capacity levels in LAs
• Resistance to change/vested interests
• Resource constraints/resistance in MoLG
• Large Number of LAs
• Interface with Central\Government systems
Issue: LAIFOMS Institutionalisation
Outsourced Private Sector Support
ODPM & MoLG LAIFOMS Implementation
& Development Support Team
LA
LA
LA
Centre of
Excellence
LA
LA
LA
LA
LA
Centre of
Excellence
LA
Outsourced Private Sector Support
LA
Issue: Appropriate ICT
architecture
LA
LA
LA
LA
U ser
U ser
P r i n te r
E th e r n e t
P r in te r
E th e r n e t
S erv er
S erv er
MoLG
U s er
User
U ser
U s er
D a ta C e n tr e /
S upport H ub
S u p p o r t S ta ff
S e rv e r
E th e r n e t
S u p p o r t S t a ff
P r i n te r
LA
LA
LA
LA
U s er
U ser
P ri n te r
E th e r n e t
U ser
P r in te r
E th e r n e t
S erv er
U ser
U s er
S e rv e r
U ser
WEB BASED ARCHITECTURE FOR LAIFOMS
AND ALL LG SYSTEMS
4th Floor, Cianda House, Koinange St.
P.O. Box 28251, NAIROBI, Kenya
Tel: +254 (20) 221 0992
Email: klgrp@accesskenya.com
Web: www.localgovernment.go.ke
A presentation by
Sylva Okolieaboh
Office of the Accountant General of the Federation,
NIGERIA.
• Introduction
• The Accounting Transactions Recording and
Reporting System (ATRSS)
• Benefits of Customised Software
• Drawbacks of Customised Software
• Custom Software: beyond ATRSS
• Commercial Off the Shelf (COTS) software
• IFMIS in Nigeria: The journey so far
• Conclusion
• Commercial off the shelf (COTS) software
refers to open market, over-the-counter
software that can be acquired and used
with or without modifications.
• In-House (sometimes referred to as
Custom or bespoke) software are those
that are developed and tailored specifically
to the needs of the client or user.
• Examples of custom software varies from
country to country. In Nigeria, we have
had two or more.
• First was the Legacy system built around
DEC Vax technology.
• There was also the SGA – Marshall which
was designed using Microsoft SQL Server
as back-end, MS Visual Basic as front and
Crystal Report as the Reporting tool.
• The latest is the Accounting Transactions
Recording and Reporting System
(ATRSS) which was designed with MS
Access.
• It has been undergoing regular updates
and upgrades.
• The latest version is built using SQL
Server and MS Visual Basic.
• The ATRSS was introduced in 2005 as a
stop-gap software to the proposed
Government Integrated Financial
Management Information System
(GIFMIS).
• It is more or less an electronic Cashbook
with interfaces for:
–Bank Reconciliation
–Budget Input
–Fund Received from Treasury
–Journal Vouchers
–Reports, and
–System Administration.
–It has a Consolidation module
• It is a basic software for
transaction recording and report
generation
• It is a stand alone, nonenetworked application
• Assists in the development of the local IT
market
• Promotes computer literacy
• Provides local/home-grown solutions to
local problems
• Cheaper maintenance cost because the
developer resides within the country
• Cheaper cost of upgrading
• Not used for Audit: it has no audit module
• Does not provide much security and is
therefore prone to malicious entries and
data manipulation
• Does not provide enough data for fiscal
reporting and analysis
• More or less a quasi-manual application
• Inadequate capacity/skill gaps affect its
effectiveness
• To judge Custom or In-house software
based solely on the success or failure of
ATRSS does not give a true and fair view
• Custom software can be very successful if
implemented diligently and honestly
• A major impediment to custom software is
the absence of subject matter experts
(e.g. Accountants) who are also
programmers.
• Most COTS are developed by reputable IT
companies
• They have been tried, tested and
perfected
• IFMIS COTS packages are designed with
core IFMIS functions incorporated
• IFMIS COTS are designed with most
security concerns addressed
• COTS packages usually enjoy strong aftersales support of their various vendors
• They are subjected to regular updates and
upgrades by their vendors in response to
new developments in ICT
• COTS packages usually come with audit
modules
• COTS come in different modules and are
scalable
• Although they are customizable, COTS usually
come as a one size fits all packages
• COTS packages come with features,
processes and procedures that are in most
cases different from those of the intended
clients thereby making them difficult to
understand
• They are expensive to maintain e.g. where
clients have to pay in hard currency for
expatriate support
• COTS requires lots of training of client
staff to familiarize them with its usage
• The entry cost/initial outlay to acquire
COTS can be staggering
• Most clients lack the in-house expertise
required to manage/maintain most COTS
packages. This may result in lengthy
down-times whenever bugs are detected.
• IFMIS is being implemented in Nigeria as
GIFMIS (Government Integrated Financial
Management Information System) since 2005
• A number of PFM reform initiatives that are
necessary to support the GIFMIS project are
either concluded or in progress. These
include:
• Formulation of Cash Management policy
• A plan to modernize the Internal Audit
function
• An IPSAS gap analysis study has been
concluded in readiness for the adoption of
cash basis IPSAS
• Various working groups have been created
in MDAs to make GIFMIS participatory
• A series of sensitization programmes have
been, and are being, conducted for Federal
Pay Officers, Directors of Finance and
accounts of MDAs and other stakeholders,
etc.
• Amendment of the Finance (Control and
Management) Act of 1958
• Review of the Financial Rules and
Regulations
• Passage of the Fiscal Responsibility Act
and the Procurement Act
• Upgrading of the Federal Treasury
Academy which is being “twinned” with the
Chartered Institute of Public Finance &
Accountancy (CIPFA), London.
• A business process documentation is in
place
• A multi-dimensional Budget Classification
and Chart of Accounts (COA) is being
finalised
• An International Competitive Bid (ICB) for
the acquisition of software, hardware, etc
done
• Four bidders have been shortlisted for the
second bid round to select the preferred
bidder
• It is projected that the programme will be
ready for test run by December, 2010.
• GIFMIS will be an online real time
software with on a wide area network
(WAN)
• An administrative framework has also
been put in place for the effective
implementation of GIFMIS. This
framework includes:
• Constitution of the Project Implementation
Task Team (PITT)
• GIFMIS Core Team
• Project Management Team
• GIFMIS is designed to have the following
modules:
• Budget preparation, approval and
maintenance, including the ability to
handle multi-dimensional charts of
account and to support multi-year budgets
• Budget execution and treasury
management, including support for:
–Budget and warrant control
– Reporting of committed and actual
expenditure against allocated/
warranted budgets
– Initially cash based but able to
support the progressive move towards
accrual based accounting
-Cash book
–Bank reconciliation
–Financial reporting
–Project accounting
• General ledger
• Procurement, including support for egovernance initiatives
• Accounts payable including commitment
accounting and controls
• Accounts receivable and revenue
recording
• Cash management
• Report writing tools.
• Both Custom software and COTS have
their strengths and weaknesses
• Nigeria has used several custom software
and is now progressing to COTS based
GIFMIS
• The future of IFMIS lies in developing a
crop of accountants and public finance
managers who are knowledgeable in both
database management and programming
Rwandan Team
Mombasa
February, 2010
128
Overview
•
•
•
•
•
•
•
IFMIS Background
System design
Achievements
Current status
Lessons learnt
Challenges
Way forward
129
IFMIS Background
• SIBET SYSTEM (2000(2000-2006)
•
- Budget preparation and execution
•
- Central Treasury Payment management
•
- ClientClient-Server (Visual Basic & SQL Server)
• SmartFMS (2003(2003-2009) – (Oracle –Java Web based)
•
- BudgetMaster (2006)
•
- PublicBooks (2006 – reviewed to meet PFM Reforms
requirements)
• May 2005, Establishment of the Office of the Accountant General
• September 2006, Promulgation of Organic Law on State Finance and
Property
• February 2007, Publication of Financial Regulations
• November 2006, Adoption of Manual of Government Policies and
Procedures: Financial Management and Accounting)
•
- Current IFMIS development phase September 2007 to date (AP,
AR, RM,
RM, GL, Procurement, Inventory and Fixed Asset Management)
System design
• Common chart of
accounts and
classification system
• Centralized General
Ledger
• Modules integration
(Budget, Procurement,
Payment and
Accounting)
• Centralized
management of access
roles and rights by
modules and institution
for transaction
processing, viewing, and
reporting
•Budget classification integration with Uniform Chart
of Accounts
- Administrative classification
- Economic classification
- Program/Project Classification
- Functional classification (COFOG)
- Funding classification (Source and Type)
•Integrated Cash management
•Central Treasury / Agency budget execution
(Commitments, Cash management and Payment)
•Payables, Receivable, Revenue, Fixed asset,
Consumable and Procurement
•Centralized General ledger system
•Integrated reporting and user management
132
•Budget preparation implementation (2006)
•Budget execution rollout (August 2006 –
commitment control, cash management, central
treasury payments/ transfers)
•Accounts Payable rollout ( July 2009 Central
Treasury Payments and transfers)
•Direct payments to suppliers by bank
transfer
•Cash transfers to budget agencies accounts
•All budget agencies and districts connected to the
system
133
•Testing General Ledger, Accounts Payable and Accounts Receivable
functionalities with PWC support.
•System documentation, business processes documentation,
designing/updating user manuals
•National data center and broadband fiber optic network across the
country at advanced stage
•Use of multiple system for budget execution and accounting pending
full rollout of an integrated system
Modul SmartFMS
e
Sage Pastel
Tompro/O
thers
Functio Budget execution and
n
central treasury
payments/transfers
General ledger and Donors ‘
cash books
projects
transactions
accounting
recording
Reconciliation, Accounts consolidation
and Audit by Office of the Auditor
General
Modules implementation roadmap
135
• Changing user requirements and business process
gaps(updated manuals, classifications, documentation)
• Carry out system support, and new system
development simultaneously
• Coordinating with remote development team (some
modules developed in India)
• limited user Involvement in the process
• Use of multiple software for government accounting
(Sage pastel, BudgetMaster,
BudgetMaster, Tompro)
Tompro)
• Late submission of accounts and reconciliation of interinterentities transactions from different software
• Limited financial management expertise of key
stakeholders
136
Lesson learnt
• User involvement and ownership
of the process ahead of time
• Ensure proper requirements
sign-off and documentation
• Ensure proper planning,
governance structure and strong
project management team
• IFMIS should be part of a
comprehensive PFM reform not
an isolated IT project
• Consider capacity building and
system sustainability
Way forward
•Strengthening the project team and governance
•International Financial management experts long
term support.
•Local FM experts and IFMIS accountants for users
support and capacity building
•Strong PMT and workgroups for effective
oversight and process ownership by users
•Study tours and External Quality Assurance to review
our strategy and streamline the implementation
process
Thank you
Implementation of Integrated Financial
Management System (IFMS) in
Tanzania
____________________________
Implementing IFMS in Govt.
Hardware
Communication
Software
Commitment
-Political Will
-Admin Will
-Perseverance
Vendor
Support
IFMS
IFMS
Management
-Project Control
-Change Mngmt.
Controls
Procedures
Training
People
Finance
Data
Introduction
• IFMS implementation in Tanzania started
in 1998/99
• Ten (10) pilot Ministries
• In 2000/2001 Rolled-out to all Ministries in Dar Es
Salaam
• In 2000/2001 Budget module was installed
• Up todate Epicor is used in all Ministries,
Regions, Subtreasuries and 85 council
Metro WAN
Treasury
Ministry of Finance
Ministry / Dept.
Central Servers
National WAN - VPN
ISP
POP
VPN
Kit
Regional Sites
Network
VPN
Kit
Sub Treasuries
ISP
POP
Firewall +
VPN Kit
Central
Servers
Why IFMS
• Lack of transparency and accountability
•
•
•
•
Over commitment and growing domestic debt
Lack of data store of financial and accounting data
Limited cash management
Lack of timely framework for reporting
• IFMS usage is growing
•
•
•
Macroeconomic Analysis and Fiscal data reporting
(GFS, CoFoG, MKUKUTA)
Changing and new Functionalities
More controls Vs user preference for less control
Audit
Auditor
- In and Out Document Review
- Workflow Review
- User Activity Review
- Analysis of on-line Data
- Procedures / Legal
- Security Review
- Access Control
- Workflow Control
- Security Administration
System Audit
• Controller and Auditor General use IFMS
data in auditing transactions
• In 2009/2010 System have been audited
by Controller and Auditor General
Fiscal data reporting
• IFMS can easily provide cash data
•
MDAs, Regions and 85 councils and some Epicor
implementing Extra budgetary units
• Problem in getting non- cash data (e.g for
assets)
•
•
Government is preparing to use Asset Management
module (in Epicor)
Valuation of government assets ongoing
• Completed training of key users provided
•
Data source selection
Consolidation
Compartmentalized Data
- Access restricted to owner
Treasury
Govt. URT
Common Structure
- Allows consolidation
Entity
Database
Sub-Treasuries
Sub-Entity
Database
- District
- Project
- District
- Project
Challenges
•
•
Government business dynamics
Technology change
•
Managing Expectations
– Internal
– External
Geographic spread
– Telecomms
– Travel
Initiatives that are not co-ordinated
Lack of skilled personnel, limited resource,
Unreliable power supply
–
•
•
•
•
E.g. High cost of upgrade
- Agencies
- Projects
Recent developments
• On Way to accrual data recording
– Chart of account for central government
defined in GFS2001
• MDAs, Regions and Sub – Treasury
• Not rollout to councils and Agencies
• Regions fully connected to central server
• All MDAs, Regions and Sub – Treasury are linked
to Dar Es Salaam central server
Future plan
• Use of Classification of Functions of
Government (CoFoG) for 2010/11
Government budget
• Use of Program Budget
• Use of electronic payment
• TISS (Tanzania Interbank System)
Government of
Uganda’s IFMS
February 2010
ISAAC MPOZA
Presentation Menu
• Introduction
• GoU IFMS
• Benefits
• Learning Points
• Challenges
• Next Steps
Introduction
• IFMS is part of the wider PFM reforms that
GoU is undertaking as a result of the Fiscal
management systems study 2002
• GoU IFMS is an integration of 7 modules of
Oracle’s Public Sector Financials suite with
minor customisations , running on Oracle
Database .
• The IFMS was implemented in 2003 initially
with ten (11) sites. To date, twenty three(24)
Central Government Ministries, Agencies and
fourteen (14) Local Governments have been
connected to the system.
GoU IFMS Modules
1
2
3
4
5
6
7
8
MODULE FUNCTIONALITY
PSB
Budget Preparation and Reporting
OPSFI
Budget Execution [Warrants, Releases,
supplementary and Virement]
PO
Procurement from Requisition to LPO;
Suppliers Processing
Database
AP
Payment
AR
Receipting of Revenue and Exchequer
Releases
to votes
CM
Bank
Reconciliation,
Cash Forecasts and
Bank Accounts’ Storage
GL
Financial Reporting
Repository for system Calendar, Chart of
Accounts and Other Common Applications
accessed by all the other modules.
Interfac
es
URA, BoU and OBT
Interfaces and Feeder
systems
• Access Based OBT [Output-Based
Budgeting Tool] developed inhouse for budget preparation and
upload in the IFMS.
• URA Interface for upload of tax
revenue and some NTR.
• BoU Interface for bank statements
upload and sending payment
instructions.
Benefits Include;
• Improvement in the Budget process
•
•
•
•
Orientation towards OOB
Budget constraints(Vote, program and Item) on system
Instant budget performance data: Budget Monitoring
Cash flow projections: Macro-forecasts
• Faster and more efficient Transaction
processing.
– Workflow notifications
– On line processing including EFT
• Improved Oversight and Internal Control
– Clear Audit trail and ability to drill down
– Transparency thru on line inquiry, views and process
workflow
– In-built Commitment Control System.
Benefits Include;
• Clear demarcation of roles thru assignment of commensurate
system responsibilities
e.g. Report running, inquiry and view only for Audit of
production system
• Instant Reporting
– Automated posting to ledgers and bank reconciliation
– On line , Secure, accurate and Complete Financial
data/Statements.
– Ease of consolidation and development of new reporting
formats using FSG and Discoverer
• Training and change management
•
•
•
•
Positive attitude and re-alignment to modern Work culture
Basic, functional and technical IT training
Linkages with various stakeholders in country and outside.
Set up of state of art infrastructure(DCs, SD and ITF)
Planning Stage
• Study and document
Requirements
• Get Stakeholders’ Buy-in
• Technical(Involve)-Develop
core cadre of super users
• Top management(Consult)
• Public(Inform)
• Review and Update PFM
legislation including CoAs.
• Consult those who have
done it before well and
badly.
Implementation Stage
• Have SPoC thru a TurnKey
• Use Phased Approach
• Minimize Customizations
• Clear Data conversion
strategy /’Short’ Parallel
run
• All processes should be
done through the IFMS
e.g. Payments, LPOs
generation ,Receipts,
Reports etc:(Go Live)
• Develop Structures (Work
groups, Forums , Org’n
reviews)
Post Implementation
• Conduct Independent
Reviews-correct mistakes, improve
and roll-on
• Focus on QA
• Review need for
technology upgrades and
monitor end of support of
system parts
• Improve documentation
such as user manuals, etc
• Refresher training
CHALLENGES FACED
People
• Demand for and High Labor
turnover of consultants on the
project.
• Re-deployment of staff who are
rendered redundant
• Inculcating a culture for use of
the system info in mgt decision
making.
• Lack of IT skills(including Audit)
and fear of the unknown
CHALLENGES FACED
Infrastructure and Application
• System failure due to bugs or user
inquisitiveness
• End of Life/Support of Hardware
and Software
• Network connectivity
• Costs of replacement and
maintenance
• Lack of sufficient infrastructure in
some votes e.g. Bdgs, Power, etc
• Cold Vs Hot Disaster Recovery site
CHALLENGES FACED
Business
• Elimination of system performed
or Non Value adding activities
• System control of the Charge
Accounts
• “Transactions” performed off the
system
• Interface with the Debt Mng’t and
Financial Analysis System
• Peculiarities of Donor Financed
Projects (Multi-currency, separate hierarchy, direct
donor disbursements to projects…) –Lack of timely donor nos.
on exp and forecasts
• Implementation of Output Based
Budgeting and Reporting.
• Unmet expectation of Macro Econ.
Modeling using OFA
Next Steps
 Ensuring use of IFMS information by
various decision makers at all levels :
Deepening
 Enhance the Data Center
(improve availability , IT
security and operations, consolidate infrastructure, Go green etc )
 Implement the IFMS in 50 other central
Gov’t votes and selected LGs.
 Implement the Integrated Personnel, Payroll
and Pension system.
 Pilot the Fixed Asset and Inventory Module
 Assess requirements for e-procurement
Presented by
MINISTRY OF FINANCE & ECONOMIC
AFFAIRS- ZANZIBAR
OUTLINE
•
•
•
•
•
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•
•
Introduction
Benefit of IFMS
How the system work
Financial Control
Adequacy of Financial Management
Auditors and IFMS
Challenges of the IFMS
Way forward
INTRODUCTION
• 2004 Central Payment Office established.
Manual)
• Purposes was to reduce;
poor expenditure management.
Accumulation of domestic debt arrears.
Inconsistent reporting
Weak internal control
Sept, 2007 IFMS introduced
•
•
•
•
Benefits:
significant improvement in reporting
Foster the reconciliation.
Customerization of reports to meet our
needs.
• Facilitate Final Accounts and National
Accounts generation.
• increase transparencies and
accountability.
• No over commitments.
Benefit of IFMS cont..
• Improve internal control features:
I. Pre audit
II.Time outs in accessing system
III.Use of passwords
IV.Access limitation
V.Availability of system administrator
HOW THE SYSTEM WORK
 Exchequer Issue
Distribution
Warrant of fund allocation
Creation of vendor
Creation of voucher
Approve Transaction
Post voucher
Generation of payment
Approve payment
Print standard check
Post payment
FINANCIAL CONTROL
• Sec 8 (1) of PFA 2005- accounting officer
in respect of each expenditure vote, shall:
• Control and accountable for :
expenditures
Revenues and
other public money received, held or
disposed off.
• Sec 11 (3) (d) of PF Regulation
• Shall be required to establish and maintain
an effective system of internal control over
the financial and related operations for
which he is responsible ……, establish and
maintain an effective internal audit
organization …..
Adequacy of financial management
control
• Lack of knowledge and skill
to the accounting officers.
1) knowledge of the
system
2) Accounting skills
• Access to the system
• Lack of commitment
177
Auditors and IFMS
• Sect 112 Constitution & Sect 25 of PFA: CAG responsible for:
• Examining, inquiring into, auditing and
reporting.
• CURRNT STATUS:
• Manual auditing:
• Reasons:
 capacity of the staff
 accessibility/ connectivity.
Challenges
•
•
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Resources constraints. (financial & human)
Inadequate financing.
Sustainability.
Backup (disaster recovery site for IFMS
database)
Commitment- management and staff.
Resistance to change
Need for political support
Linking IFMS with Central Payroll and Budget.
Way forward
• Linkage with other unconnected
ministries.
• Extend IFMS to other modules e.g Asset
and Inventory modules.
• Disaster recovery site.
• Further capacity building.
• Power outages.
•ASANTENI SANA
KWA KUNISIKILIZA
UNITED REPUBLIC OF TANZANIA
Prime Minister’s Office
Regional Administration and Local
Government
(PMO-RALG)
IMPLEMENTATION OF FMS:
LESSONS FROM ROLLING OUT EPICOR TO
LOCAL AUTHORITES
Feb. 2010
Emmanuel Mahinga – Assistant Director
Presentation Layout
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•
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Background
Experiences in Rolling out IFMS
Challenges
Recommendation for effective roll-out
Mombasa , Feb. 2010
Background
• Use of ICT in the government is a result of various
structural and social economic reforms ( LGRP,
PSRP, Financial Sectors Reforms) beginning in
1980s .
• Reforms introduced various concepts and tools
Mombasa , Feb. 2010
Background …
Mombasa , Feb. 2010
Background …
Mombasa , Feb. 2010
Experiences in Rolling out IFMS
Mombasa , Feb. 2010
Experiences in Rolling out IFMS..
• Implementation process – Steering
Committee
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Accountant General’s Department
Long Term Advisor to Accountant General
LGRP
MRALG,
Key Donors
Price Water House Coopers as the Financial
Consultants to LGRP
Mombasa , Feb. 2010
Experiences in Rolling out IFMS..
• Key aspects brought forth by the Steering
Committee were:
– The IFMS must be operational by July 2000;
– The IFMS should comply to the Local Authority
Accounting Manual (LAAM);
– Initial configuration should be economical with minimal
hardware and software requirements;
– Local Authority personnel should be involved in the
IFMS business process and design;
• Soft-Tech was Commissioned to implement
Mombasa , Feb. 2010
Experiences in Rolling out IFMS..
• Workgroup was created to
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Carry out business process analysis
Chart of accounts structure
LGA business process
Reporting requirements
• Plans to train and roll-out after approval of
BPA
Mombasa , Feb. 2010
Challenges in Rolling out IFMS
• Implementation started – no clear strategy in
creating / formation of technical and
application teams – vendor carried out initial
implementation
• LGRP I recruited a team of accountants (FMS)
and placed them under ZRT and trained in
2001
• Regional Financial Management Specialists
were trained in 2003 to complement FMS-ZRT
Mombasa , Feb. 2010
Challenges in Rolling out IFMS..
• Increasing workload and staff turnovers prompted LGRP to
request ACGEN to assign a separate team within the CG
SDU to support IFMS in 2004
• SSU was formed to provide first line of support to LGAs (11
application specialist and 9 technical specialist) Stationed
in Zonal settings under sub-treasury
–
–
–
–
Not very conducive set-up for sustainability and reporting
Inadequate number for effective support
Ineffective logistical support and funding
Inadequate coordination mechanism and unclear escalation
procedures
– Substantial support for key processes required from outside.
– Inadequate plans for training and support Mombasa , Feb. 2010
Challenges in Rolling out IFMS..
• Cont..
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Lack of incentives
Poor power supply
Inadequate maintenance of hardware
Short of skilled manpower
Historical poor financial discipline hence avoiding enforcements
from the systems – processing outside the system to
circumvent procedures, incentives not to report problems,
accounting for revenues
– Understanding of Technical language ( see chart of accounts)
– Existence of other systems – Planning and reporting
Mombasa , Feb. 2010
Other PMO-RAL MIS
IFMS National Budget
PlanRep/LGMD
MKUKUTA
Macro
RIMKU2
PlanRep/LGMD
Epicor
Meso
TSED
PlanRep/LGMD
Micro
SBAS
Macro
SBAS Micro
(MDAs, Regions)
Mombasa , Feb. 2010
Recommendations for Effective rollout
• Low Usage: Are existing systems supply
driven or demand driven
– Supply driven systems: revolve around technical fixes
– Demand Driven systems: focuses on the priority to
use monitoring information and evaluation findings in
support of core government activities – planning,
resource allocation, policy making etc.
– There is a need for a substantive demand for M&E
information (existing or created) either for
accountability or learning or a combination of these
Mombasa , Feb. 2010
Recommendations for Effective
rollout…
• if the main intended use
– To assist line managers (use for daily work)- the
learning function of M&E — broad civil service
culture is important.
– Primarily for accountability purposes – Narrow??
– as a tool for performance budgeting – Narrow ??
– as a tool to support evidence-based policy
formulation and analysis, then it is more likely to
involve all staff hence implementation challenges are
minimised
Mombasa , Feb. 2010
Recommendations for Effective
rollout…
• Why Low Utilisation of Systems?
– Low awareness of its existence?
– Low level of demand for it?
– Poor quality data that are considered
unreliable?
– Lack of staff able to analyze and act on the
information?
Mombasa , Feb. 2010
Recommendations for Effective rollout …
•
•
•
•
•
Systems must be simple
Support structures must be established foe sustainability
Painless
Proactive not reactive
Minimalist approach – Think big but start small and enable
continuous improvement
– principles of optimal ignorance – not learning more than
necessary, and of appropriate imprecision – not measuring
what need not be measured, or more accurately than needed;
• Manual systems must be in place and working prior to
computerisation and not the other way around
• Demand must be created by gradual effort (The behavior of
individuals and organisations is governed by the rules and
incentives within which they are expected to behave. (IFAD)
Mombasa , Feb. 2010
Thank you for listening
Mombasa , Feb. 2010
What are the Impediments to
Successful IFMIS
Implementation in Africa?
Regional Workshop on IFMIS
Presenter:
Stephen Mayes – IMF-East AFRITAC
Group Discussion
• Objective:
– To gain an understanding of the
implementation experience of all
participant countries
– Main problems encountered
– Critical Success Factors (things that must
be in place to succeed),
– What assistance do you need to move
forward?
Discussion Organization
• Form FOUR Break-out groups
– Break-out group discussion 30 mins
• Each break-out group to present
findings for 10 mins
• Plenary discussion 20 mins
Aust Govt. PFM Reform
INPUT
MNGT.
PROGRAM
MNGT.
(EXPEND.
(PURPOSE)
TYPE)
OUTPUT
MNGT.
(PRODUCTS
DELIVERED)
(IMPACT ON ECONOMY
COMMUNITY)
HIGH LEVEL INPUT
CONTROL
DETAILED INPUT CONTROL
CENTRALIZED MNGT.
OUTCOME
MNGT.
DEVOLVED MANAGEMENT
CASH
ACCOUNTING
ACCRUAL
ACCOUNTING
CASH BUDGET
ACCRUAL BUDGET
ANNUAL EXP. FRAMEWORK
FINANCIAL REPORTING
MANAGEMENT
ACCOUNTING
ACCRUAL
APPROP’NS
MTEF
PERFORMANCE REPORTING
Aust Govt. PFM Reform
• Devolved cash management
– Within TSA
• Devolved budget preparation
• Shifting Treasury from back office to middle
office
• Increasing institutional scope to General
Government
• Simultaneous accrual (IFRS/IPSAS)
GFS/COFOG/cash/Fund budgeting and
accounting
– 5 year MTEF
Critical Success Factors
• Political commitment
• Methodology, methodology, methodology
– Systems engineering approach - CASE
•
•
•
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Experienced systems integration partners
Project team structure
Proper time frame
Clear scope –institutions, business areas,
data
• Sequencing
• Integration
• Government-wide IT strategy and standards
Critical Success Factors
• MDA discipline – MOF control
• Clear contractual relationship with software
provider – SLA
• Articulation of overarching reform philosophy
and agenda
• Promulgation of clear phased strategy
• Well designed change management strategy
– not just training, cultural change
• Establishing enabling legal and institutional
environment
Preconditions
• Essential precondition: IFMIS reforms
should be based on solid financial
management platform, sustained by
stable, credible institutions
• Existing structural problems need to be
remedied first, otherwise can undermine
reforms
Pace and sequencing of reform
• A realistic timeframe and careful sequencing
of reform elements is critical for success
• For countries with resource and capacity
constraints, a gradualist approach is
preferred.
• Management capacity must be progressively
strengthened:
– Give organizations time to absorb each stage of
reform before embarking on next stage
– Otherwise, high risk of “reform fatigue”
Key Implementation Tasks
• Develop and disseminate philosophy of change:
drivers, objectives, deliverables
• Undertake detailed scoping study: determine
overarching policies, scope, structure, context and
sequencing
• Establish project governance structures: SC,
advisors, consultative groups, project teams, QA and
audit
• Establish communication and training program
• Develop/adopt accounting standards/policies (if
moving to accruals basis)
• Pass financial legislation
• System Development : analysis, specification,
selection, design, construction, testing, training of
FMIS
• Data conversion from existing systems
•
•
•
•
Scoping study
Scoping study should:
define high level policy framework
Define scope of all elements of new system
Formulate high level migration plan, showing
sequencing and “temporary bridging”
between different elements at various stages
• Phased “context diagrams” showing
relationship of all key elements at various
stages through the implementation
• Temporary bridging or interfaces very
complex and costly to build and maintain:
– Attraction of big bang approach
IFMIS Structure
Staging by business area
• Indicative Stage 1
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General ledger - CoA
Purchasing – procurement, COM
Payments and AP – supplier/grantee payments, arrears
Revenue – invoicing, returns etc.
Receipts and AR
Banking – deposits, transfers, bank accounts, reconciliation
etc.
Cash management – cash budgeting, forecasting, cash
accounting etc.
Fund management – donor projetcs, trust accounts, approp.
accounting etc.
Data collection & consolidation – auto elimination
Financial reporting – management reports, IPSAS reports,
GFS reports, budget reports etc.
Management of estimates, projections and budgets
Sequencing of Steps
• Sequencing should take into account context of overall reform
agenda
• Be mindful of capacity of agencies (and MOF) to absorb multiple
reforms simultaneously
• IFMIS is supporting rather than leading broader public reforms
• As a broad guide, developed or transitional country with good
access to resources might target timeframe of 3-5 years for full
IFMIS
• Developing country might target 7-10 years for full
implementation.
• All govts. should adopt a staged approach, with clearly
articulated migration plan:
• Different staging modalities:
– Staging by business area
– Staging by entity grouping/sector
– Staging by materiality of entities
Staging by business area
• Indicative Stage 2
– Investment management
– Debt management
• Indicative Stage 3
– Fixed assets
– Inventory
• Indicative Stage 4
– HR/Payroll
– Cost accounting
– Executive information system
Staging by Sector or Size
•
•
•
•
First target state enterprises
Then semi-autonomous agencies
Then “budget sector” (core) ministries/agencies
Facilitates gradual development of core of
implementation expertise
• Govt. initially produces consolidated reports for
various sub-sectors
• Can also stage by materiality of entities:
– Concentrate initial implementation effort on agencies
representing 98-99% of consolidated budget
– Defer transition of v. small entities lacking resources
• Where capacity is low, conduct pilot studies in key
agencies to build experience for wider
implementation.
Cultural Change Strategy
• Well observed phenomenon that all
major institutional reform programs
meet resistance, which weakens as
reforms become “institutionalized”
• Adoption of FMIS substantially
increases the workload of civil servants
• Overcoming resistance depends
critically on change management
planning and execution
Cultural Change Strategy
• Change Management strategy:
– Development and promulgation of overarching
philosophy of change:
• Used to build consensus for need for change and chosen
strategic direction
– Visible high level commitment at the political level
– Empowered reform team led by “champion”
– Education, training and cultural change programs
• From legislators down to program managers
– Sometimes combined with PS HR reforms
Challenges
• Indiscipline by MDAs
– Transactions off the system
– Slow and inaccurate reporting
– resistance
• Lack of project resources at MOF, MDA and
LGs
• Lack of methodology
• Very slow progress
• Lack of functionality - full potential not
realized
• Unclear user requirements
• Unclear strategic direction of PFM reform
Challenges
• Multiple overlapping reform projects
– Lack of sequencing
• Poor systems documentation
– Policy and business model
– Functional and technical requirements
– Design document
– Testing scripts and results
– Policy and procedures documents
– Training documents
Challenges
• Lack of Government-wide IT strategy
and IT standards
• Difficulties building interfaces with
external systems
– Central and commercial banks
– Revenue authority
– Debt management e.g. CSDRMS
– Budget preparation
– Operational (non-financial) management
systems
Challenges
• Uncertainty about internal control
• Cost overruns
• Shadow systems – instead of “one
truth”
• Scope creep
• Automation of existing processes
– Not a bridge to the future
Break-out group discussion