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AGENDA. 10:00-10:30: Knowing each other10:30?11:15: Intro to HACT11:15-11:30:Tea Break11:30?13:00: How will Agencies coordinate their micro-assessments (group work; presentations)1 pm: Lunch2?2:30: End presentations group work2:30?3:15: Intro to FACE3-15-5:00: Group exercises 5:00:
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1. Harmonized Approach to Cash Transfers (HACT)INDIA EXCOM AGENCIES WORKSHOP
2. AGENDA 10:00-10:30: Knowing each other
10:30–11:15: Intro to HACT
11:15-11:30: Tea Break
11:30–13:00: How will Agencies coordinate their micro-assessments (group work; presentations)
1 pm: Lunch
2–2:30: End presentations group work
2:30–3:15: Intro to FACE
3-15-5:00: Group exercises
5:00: Closing
3. Getting to Know Each Other 5 minutes: tell your neighbor you are
5 minutes: now it’s his/her turn
5 minutes: Report
4. PURPOSE THIS WORKSHOP TO LEVEL OUR UNDERSTANDING OF HACT
TO PLAN FOR HACT AS UN EXCOM AGENCIES
TO CLEAR THE WAY FOR SOME DECISIONS
BY AGENCIES REPS AND UNCT
5. AN INTRO TO HACT WHY?
KEY ELEMENTS
6. Why HACT? Call from member-states (TCPR):
Reduce transaction costs
Call from donors (Rome and Paris):
Simplify policies and procedures;
Progressively align with national systems
National ownership, grounded in strengthened capacity and increased use of national systems
7. HACT: key provisions One for all and significantly simplified set of procedures :on requesting/disbursement/reporting on funds (FACE) and audit
Risk Management vs. System of Controls !!! The risk management approach allows to reduce the time spent on administrative processes and focus more on programmatic needs
!!! The risk management approach allows to reduce the time spent on administrative processes and focus more on programmatic needs
8. Risk Management vs. System of Controls Step 1. Upfront assessment of risks (at 2 levels)
Step 2. Leveraging identified risks through:
Choice of an appropriate cash transfer modality and procedures;
Scope and frequency of assurance activities
9. Key elements/tools of HACT Macro and Micro Assessments
Assurance Activities
Funding Authorization and Certificate of Expenditure (FACE)
10. Macro Assessment A review of the national public financial management system
Based on existing assessments
No formal risk rating; no conditionality
Once per cycle Issues covered by the Macro Assessment include:
National budget development & Execution
Compliance with public sector accounting standards and internal control mechanisms
Control of cash
Audit and oversight
Strength of the financial systems and staff
Issues covered by the Macro Assessment include:
National budget development & Execution
Compliance with public sector accounting standards and internal control mechanisms
Control of cash
Audit and oversight
Strength of the financial systems and staff
11. Objectives: Management Objective:
Background for cooperation modalities selection
Development Objective
Opportunities for capacity development Management objective:
Provides background information for selection of appropriate cash transfer modalities & assurance activities
Assist in establishing whether the SAI can be relied upon for auditing IPs
Development objective:
Ensure awareness of PFM environment, including weaknesses & strengths of PFM
Identify opportunities for capacity development
Management objective:
Provides background information for selection of appropriate cash transfer modalities & assurance activities
Assist in establishing whether the SAI can be relied upon for auditing IPs
Development objective:
Ensure awareness of PFM environment, including weaknesses & strengths of PFM
Identify opportunities for capacity development
12. INDIA’s MA: completed Funded and led by 3 Excoms
UNICEF lead Agency for contract
Completed Sept. 2007
Available with Agencies
Summary of findings (WORD DOC)
13. Micro Assessment Assessment of the adequacy of the implementing partner’s financial management systems and practices and internal controls;
Once per programming cycle done by a PA firm;
Threshold: US$ 100,000 collectively from UN Agencies per year
14. Objectives: Development objective:
areas for capacity development of IP
Management objective:
most suitable CTM
frequency and scope of assurance
!!! Risk rating, but no “pass or fail”
Development objective:
Establish strengths & weaknesses of financial management practices of IP
Identify possible areas for capacity development
Management objective:
Assist in identifying the most suitable CTM
Guides the decision on frequency and scope of assurance activities
Micro Assessment envisages a risk rating, but does not provide “pass or fail” to IPs
Development objective:
Establish strengths & weaknesses of financial management practices of IP
Identify possible areas for capacity development
Management objective:
Assist in identifying the most suitable CTM
Guides the decision on frequency and scope of assurance activities
Micro Assessment envisages a risk rating, but does not provide “pass or fail” to IPs
15. Assurance is…
Determination whether funds were used for the purposes intended
Checking accuracy of partner’s reporting on the use of funds to ensure expenditure is true and fair
16. Key Principles Scope and Frequency of assurance activities depend on the risk and amount of cash transfers
Invest more in assurance activities for weaker partners
17. Assurance Activities Once in a cycle audits
Periodic On-site reviews
Spot checks
Special audits to address specific weaknesses
Programmatic assurance
Field monitoring
Annual reviews
18. What’s FACE? One unified form: certification, request, invoice, report
Requires no supporting documentation (e.g. invoices, contracts attached, etc.)
Same format by all ExCom Agencies, all partners
Cash disbursed, but not utilized - reprogrammed Certifies expenditures
Provides a basis for the disbursement of funds for the next period
Serves as a request to spend, a verification of what was spent and as an invoice
Permits disbursements quarterly, not on a transaction basis
Supports advances, direct payments and reimbursements
Certifies expenditures
Provides a basis for the disbursement of funds for the next period
Serves as a request to spend, a verification of what was spent and as an invoice
Permits disbursements quarterly, not on a transaction basis
Supports advances, direct payments and reimbursements
19. Why Funding Authorization and Certificate of Expenditure (FACE)? To lower complexity and amount of procedures for IPs
To save time and effort for Partners and UN Agencies staff
Allow more time for focus on programmatic issues Point 2 in answer. One system for all. This reduces the administrative burden on implementing partners.Point 2 in answer. One system for all. This reduces the administrative burden on implementing partners.
20. More info…
www.undg.org
21. NEXT STEPS REVIEW OF PARKING LOT, NOTES, PHOTOS
YOUR ROLE AS TRAINERS
JOINING HACT GLOBAL NETWORK
CREATING A LOCAL INDIA HACT GROUP
22. CLOSING THANKS ANURADHA