Transcript Presentation of Zambian IFMIS Integrated Financial Management Information Systems (IFMIS)

Presentation of Zambian IFMIS
Integrated Financial Management
Information Systems (IFMIS)
Chitundu N Mwango
Accountant General
Ministry of Finance and National Planning
Lusaka, Zambia
Telephone 260 (1) 251471
Email: {[email protected]}
Slide 1
Slide 1
Background
• The Government has been implementing the Public
Service Reform Programme (PSRP) from 1993.
 The aim of the PSRP is to improve the quality, efficiency and
effectiveness of Public Service delivery.
• In 1999 a concern arose as to whether the measures
taken under the PSRP framework had resulted in
improved performance.
 It was acknowledged then that these measures had not led
to tangible improvements in the delivery of public services.
• Therefore, Public Service Capacity Building Project
(PSCAP) was designed to support the implementation
of the Public Service Reform Programme.
 PSCAP is financed by the World Bank and managed at
Cabinet Office
 One of the PSCAP component was the “Financial
Management, Accountability and Transparency”
 IFMIS is a project within the “Financial Management,
Accountability and Transparency” component
Slide 2
Slide 2
Background
• In 2000 a local consulting firm was engaged for 6
months and produced the IFMIS roadmap
• In 2001 a local short term consultant was recruited
to initiate the implementation of IFMIS
 Assisted in recruiting Project Manager, Manager IT and
Manager Accounting.
 Other Managers (Budget, Audit, Debt, Training) identified
by roadmap were not recruited due to lack of funds
 Initiated the process of engaging a consulting firm to
analyse and design IFMIS
• Government seconded one principal accountant and
three principal analysts to the Project team but did
not stay because of lack of incentives
Slide 3
Slide 3
IFMIS Design
• In 2002 Government issued a tender for a long term
consultant to analyze and design IFMIS
 However the tender for the long term consultant was annulled
(cancelled) because of disagreement between the Government
and Bank on the procurement process
• An IFMIS advisor was recruited through Bank but was
based in Washington and Government terminated the
contract
• Government decided to use the local IFMIS Project
team to analyze and design IFMIS
 This saved Government about $1million
• The Project team undertook a comprehensive
assessment of user requirements and conducted IFMIS
sensitization workshops
Slide 4
Slide 4
IFMIS Design
• The local team designed the IFMIS chart of
accounts which took into consideration the GFS
and IPSAS
• Produced the IFMIS assessment report,
Requirements Specification, and Chart of
Accounts as part of IFMIS design
• Undertook study tours of IFMIS
implementation in Tanzania and Uganda
• Initiated a tender for installation and
implementation of IFMIS using the World Bank
procurement guidelines
Slide 5
Slide 5
Implementation Plan
• Zambian IFMIS will be implemented in three phases
• Phase 1 (Pilot Implementation – 8 months)
– A total of 3 Ministries and 2 Provinces will be hooked to the
Data Centre (Accountant General).
– Interface with Bank of Zambia and Zambia Revenue
Authority for the Treasury Operations.
– The pilot sites are:
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Ministry of Finance and National Planning, Lusaka
Ministry of Education, Lusaka.
Ministry of Works and Supply, Lusaka
North-Western Province, Solwezi
Eastern Province, Chipata
• Phase 2 (Rollout Implementation – 20 months)
– 41 Ministries, Provinces and Spending Agencies will be
hooked to Data Centre
• Phase 3 (Interface Implementation – 6 months)
– Local authorities, parastatals will interface with Data Centre
Slide 6
Slide 6
Integrated Financial Management Information
System (IFMIS)
Other Government Information
Systems
IFMIS
IFMIS
Purchasing
Physical Resource Management
Project
Accounting
Asset
Management
Inventory
Management
Accounts
Payable
Purchasing
Cash/Debt
Management
Budget
Preparation
Human Resource Management
Personnel
Payroll
General
Ledger and
Budget
Control
Budget
Preparation
Revenue Management
Accounts
Receivable
Tax Collection and
Management
Financial Management
Information
(Consolidated Reporting)
MINISTRY OF FINANCE
LEGEND
IFMIS Module Full Integration
System Interfaces/Full Integration with IFMIS
IFMIS On-line Access
Budget
Control
Financial
Management
Information
OTHER
MINISTRIES/
COST CENTERS
Government Business Enterprises
Information Systems
Financial
Institutions
Manufacturing
Companies
Other
Enterprises
Slide 7
Slide 7
Status on IFMIS tender
• Prepared two bidding documents (prequalification and IFMIS main bid)
• Pre-qualification bid documents were issued in
Jul 2003 and (19) applicants were received.
• Initially 4 firms were pre-qualified but later
increased to 7 firms and main bid documents
were issued to 7 firm in Dec 2004
• Only 3 bids were received and after evaluation
undertook post-qualification assessment of the
lowest evaluated bidder in Jun 2004
• Pre-contract negotiation held in Aug/Sep 2004
and requested for no objection from the World
Bank to sign contract
Slide 8
Slide 8
Progress/Achievements – Systems and Infrastructure
• Developed the Activity Based Budgeting
(ABB) software and MTEF in 2003 and
implemented in 2004
 Parts of the IFMIS chart of accounts adopted in
the ABB and FMS
• Upgraded the FMS and commitment control
system using the local team (the system was
appreciated by IMF and IDA)
• Implemented the Payroll Management and
Establishment Control (PMEC) system using
SAP to efficiently manage and control public
service payroll
• Currently piloting CAATS in two ministries
Slide 9
Slide 9
Progress/Achievements – Systems and Infrastructure
• Developed and implemented a Static Arrears
database in June 2003 (saved $90,000)
• Developed and implemented an Asset register
for moveable assets in line ministries which
will be an input to the IFMIS assets module
• Currently upgrading the LAN at MOFNP
compatible to IFMIS
• Currently completing the preparation of the
five (5) IFMIS pilot sites
Slide 10
Slide 10
Progress/Achievements – Training & Change mgt
• 400 Accountants trained in FMS and CCS
• 50+ Procurement Officers trained in Commitment
Control System
• 12 Persons trained in Prince2 project management
• 120+ internal auditors and Auditor General staff
trained in Computer Aided Audit Techniques (CAATs)
• Sensitized members of Parliament (Public Accounts
Committee and Estimates Committee), Permanent
Secretaries, Directors in Ministries, accountants and
auditors in IFMIS
• Salary officers in all line ministries trained in PMEC
systems
• Developed an in-service syllabus (including IFMIS) in
Government accounts for accountants, auditors and
non-accounting staff
Slide 11
Slide 11
Progress/Achievements – Other initiatives
• Revised the Finance Act (currently being
debated by parliament)
• Constituted the PEMFAR steering committee to
provide policy guidance to the IFMIS project
(with representation from Zambia National
Tender Board, Auditor General, Bank of Zambia,
Revenue Authority, Clerk of National Assembly)
• Formed six (6) IFMIS implementation working
groups to facilitate stakeholder involvement in
IFMIS implementation and ensure sustainability
after the project ends
• Internet Connection to commercial banks to
download the bank statements
Slide 12
Slide 12
Benefits of interim measures
• Improved cash monitoring through internet
connection to the banks
• Bank reconciliation on time due interface
with banks
• Timely production of financial reports (the
2003 financial report is being printed)
• Production of monthly expenditure returns by
Ministries, Provinces and Spending Agencies
within 15 days
• Eliminate ghost workers and other
irregularities by linking (matching)
establishment to the payroll
Slide 13
Slide 13
Way Forward - PEMFA Programme
• In 2003 Government and the World Bank
completed the Public Expenditure
Management and Financial Accountability
Review (PEMFAR) which is a diagnostics tool
• Comprehensive Integrated Reform
 Focus on inter-linkages ensures appropriate
sequencing and timing
 Entire public expenditure management procedure
chains reformed
• Table on next slide summarises the 12
components identified within the Government
Strategy Document.
Slide 14
Slide 14
Way Forward - PEMFA Programme
1 Accounting and
IFMIS implementation
(MFNP, OAG)
Goal: To improve public expenditure management
through an integrated and automated financial
management system in order to ensure efficient and
effective utilisation of public resources.
2 Improved Fiscal
Policy and Economic
Planning (MFNP,
Planning)
Goal: To ensure macro-economic stability and attain a
policy based planning and budgetary process capable of
facilitating the effective mobilization and allocation of
resources in a systematic, effective, efficient and
predictable manner.
3 Reformed Budget
Preparation (MFNP,
Budget)
Goal: To establish a credible budgeting process and a
transparent and clear presentation of the budget
document.
4 Improved budget
execution (MFNP,
OAG, Budget)
Goal: To implement the budget in a more efficient and
predictable fashion and reduce variance between
budget and actual spending.
5 Improved Debt
Management (MFNP,
Investment and Debt)
Goal: To manage Zambia’s debt, both Domestic and
External to sustainable levels and effectively manage
Government Investments.
6 Improved Internal
Audit (MFNP,Internal
Audit)
Goal: To strengthen internal controls throughout the
public sector for improved public expenditure
Slide
management and financial accountability.
Slide 15
15
Way Forward - PEMFA Programme
7 Better External
Finance
Coordination
(MFNP, ETC)
Goal: Improve overall budgetary planning and
coordination of external financing by integrating
donor flows into budget.
8 Consistent Legal
Goal: To have a consistent and harmonised legal
Framework for PEM
framework ton support transparency and
(MFNP and MOLA)
accountability in the Public Sector
9 Strengthened
External Audit
(Auditor General)
Goal: Enhance external auditing function for improved
accountability and transparency in the utilization of
public resources.
10 Enhancing
Parliamentary
Oversight
(Parliament Clerk)
Goal: To develop the capacity of the Parliament to play
its oversight role in public resources management in
order to promote accountability, transparency and
a culture of democratic governance,
11 Accountancy
Training and
Regulation (ZICA)
Goal: To strengthen the accountancy profession and to
provide effective regulatory services in order to
promote high professional and ethical standards
12 Public Procurement
Reform
Goal: To promote and institutionalise a transparent,
accountable and efficient public procurement
system in order to improve expenditure management
Slide 16
Slide 16
Challenges/Lesson Learnt –Procurement issues
• The IFMIS procurement procedures are too long, for
example it has taken about 20 months to procure the
IFMIS system
• Delays in obtaining no objections and approvals from
stakeholders
• Pressure from strong stakeholders causes delays and
selection of suppliers who may not deliver, eg
increasing the pre-qualified firms
• Conflict between procurement procedures and
standard Information Systems development
procedures
 For example, procurement procedure did not allow all prequalified firms to demonstrate their solution to Government
before making final selection
Slide 17
Slide 17
Challenges/Lesson Learnt – HIPC Benchmark
• IFMIS as a HIPC Benchmark helped to
sensitizes stakeholders on importance
of IFMIS and secured political will
• Puts pressure on Governments to rush
the implementation of IFMIS
Slide 18
Slide 18
Challenges/Lesson Learnt – Financing issues
• Shortage of equipment and lack of connectivity
(LAN) delayed the pace of implementing the
retooled FMS and CCS
• IFMIS costs are huge (US$24million) and
difficult to find partners who are willing to
finance
• Financing arrangement of IFMIS project
through third party delayed implementation
• Justification of IFMIS in view of competing
social needs such as education, health and
development projects
• Continued support by cooperating partners is not
easy to maintain
Slide 19
Slide 19
Challenges/Lesson Learnt – Human issues
• User resistance and other important
stakeholders not participating
• Change management issues
• Power and politics as to who is the
IFMIS Champion
• Retention of core team to implement
the IFMIS and the issue of incentives
for civil servants
Slide 20
Slide 20
Conclusion
• Although the IFMIS main contract has not
yet been signed with the Supplier due to
lengthy procurement procedures, Government
has made a number of significant achievement
in public financial management and preparing
for full implementation of IFMIS
• Experience acquired from development and
implementation of ABB, FMS and CCS as well
as study tours will help Government in the
implementation of IFMIS
Slide 21
Slide 21
Conclusion
• Thank You
Slide 22
Slide 22
Development of FMS
FEATURES/
COMPONENTS
OLD FMS
NEW FMS
V1
NEW
FMS V2
Year of Implementation
1995
2002
2004
Software
COBOL
MS-Access
MSAccess
Budget Management












Automation of the printing of
the Payment Voucher



Activity Based Budget






Funding Management
Commitment and Arrears
Expenditure Management
centralized
Peer to peer network
Excel
centralized
Slide 23
Slide 23
Development of FMS – Major Reports
1
2
3
4
Type of Report
OLD
FMS
NEW
FMS V1
NEW
FMS V2
Listing by Document
type



Monthly Expenditure
Returns



Statement C (financial
statement)
Vote Book






centralized
centralized
Annual only
decentralized
decentralized
monthly/ annually
decentralized
decentralized
Slide 24
Slide 24