level. There is a risk that throughout implementation of the FM procedures adherence to approved government program, it will be necessary to manual will be policies and procedures may be update the old project a condition of negatively affected by poor staffing implementation FM effectiveness. unit’s levels at both the national and procedures manual, to take into levels. account the absorption of the unit into the Ministry, while still retaining independent operation on the FINPRO system. Funds Flow risk that funds may not S Arrangements will be made to No M – be used for purposes intended, transfer funds from the DA direct particularly at the remote district to beneficiaries, on the strength of levels. properly approved certifications by the districts. Financial Reporting - there is a risk M The project will produce quarterly IFR formats and M that reports may not be available in a interim un-audited financial reports formats of timely manner, and that they may not in a format to be agreed by annual financial incorporate all relevant data. negotiations. The reports will statements were cover all project activities, agreed irrespective of financier. Annually, negotiations – audited financial statements must Condition met. be submitted to the program partners within six months of the end of the year audited. Auditing - risk that audits may not be M While the program will be audited Audit TORs M conducted in accordance with by the AG annually, terms of were agreed at international auditing standards due to reference for the audit will be negotiations - the low staff capacity of the Auditor prepared in consultation with the Condition met. General contributing partners. On the issue (AG)’s office. of staffing, the AG is allowed to outsource the services to private professional audit firms should work load issues require it. Overall Control Risk M Per above. M Overall Risk Assessment S M Strengths As already indicated, this is the third phase of the FTI, implemented by the MoET. Although phases I and II benefited from a standalone Project Support and Coordination Unit (PSCU) which has since been disbanded, a lot of necessary experience was gained during the preceding phases, and most aspects of the PSCU have been incorporated into the Ministry, including the FM Procedures Manual (to be updated), and at least one Accountant and two Assistant Accountants. For the earlier phases, no major negative financial management issues were raised in supervision missions and in annual audit reports prepared by the Auditor General
level. There is a risk that adherence to approved government policies and procedures may be negatively affected by poor staffing levels at both the national and levels. throughout implementation of the program, it will be necessary to update the old project implementation unit’s FM procedures manual, to take into account the absorption of the unit into the Ministry, while still retaining independent operation on the FINPRO system. FM procedures manual will be a condition of effectiveness. Funds Flow – risk that funds may not be used for purposes intended, particularly at the remote district levels. S Arrangements will be made to transfer funds from the DA direct to beneficiaries, on the strength of properly approved certifications by the districts. No M Financial Reporting - there is a risk that reports may not be available in a timely manner, and that they may not incorporate all relevant data. M The project will produce quarterly interim un-audited financial reports in a format to be agreed by negotiations. The reports will cover all project activities, irrespective of financier. Annually, audited financial statements must be submitted to the program partners within six months of the end of the year audited. IFR formats and formats of annual financial statements were agreed negotiations – Condition met. M Auditing - risk that audits may not be conducted in accordance with international auditing standards due to the low staff capacity of the Auditor General (AG)’s office. M While the program will be audited by the AG annually, terms of reference for the audit will be prepared in consultation with the contributing partners. On the issue of staffing, the AG is allowed to outsource the services to private professional audit firms should work load issues require it. Audit TORs were agreed at negotiations - Condition met. M Overall Control Risk M Per above. M Overall Risk Assessment S M Strengths As already indicated, this is the third phase of the FTI, implemented by the MoET. Although phases I and II benefited from a standalone Project Support and Coordination Unit (PSCU) which has since been disbanded, a lot of necessary experience was gained during the preceding phases, and most aspects of the PSCU have been incorporated into the Ministry, including the FM Procedures Manual (to be updated), and at least one Accountant and two Assistant Accountants. For the earlier phases, no major negative financial management issues were raised in supervision missions and in annual audit reports prepared by the Auditor General
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