Harari People National Regional State

1. Harari People National Regional State Reform Awareness Workshop January 2006

2. Structure of Presentation • Awareness on the Reforms • On going Reform activities in Harari • Identify specific areas of support from Public Body Heads • Question and Answers

3. Background • Expenditure Management and Control Sub-Program is one of the five sub programs of the Civil Service Reform

4. Objectives of EMCP • To strength the capacity of the public financial management system to manage public sector financial transactions • To improve the capacity of public sector managers to use information to permit better planning, management and control • To develop on the platform that budget allocations are driven by policy

5. Components of EMCP • Legal Framework • Budget Reform • Accounts Reform • Expenditure Planning • Internal Audit • External Audit • Cash Management • Financial Management Information System • Human Resource Development

6. Program Management • National Steering Committee • EMCP Coordination Office • Regional Steering Committee • Regional Reform team

7. Reasons for Financial Reform • The system was designed for a unified rather than a fiscally devolved system • The accounts system provided only rudimentary control (cash only) • The way the budget was classified & structured did not facilitate the management & planning of public finances

8. Reasons for Financial Reform …continued • 6 years backlog in finalizing accounts • Modernization of public sector financial system • Conditionality of Development Partners • Requirements of new aid modalities • No IT system leading to inefficiency

11. Region Budget Reform Accounts Reform Expenditure Planning Federal ü ü ü SNNPR ü ü ü Tigray ü ü ü Amhara ü ü ü Oromia ü ü ü Ben/Gumz ü ü Harari ü ü Afar ü Somali ü Gambella ü Adis Ababa ü ü Dire Dawa ü ü Status of the reform as of FY 1998

12. Benefits of the Reform • Legal framework established • Accounts backlog reduced to one year • Budget approved and notified on time • Budget & Accounts manual/module developed and translated (Amharic, Oromiffa, Somali & Tigrigna) • Financial Information System developed and used (BIS/BDA) • 56,000 staff trained • Staff empowered

13. Benefits of the Reform…cont’d • Standard Chart of Accounts used • Budget structure standardized • Cash and management control • Comprehensive reporting • Implement modern accounting systems • Development partners confidence increased • Direct budget support • Debt write off • Ramping up financial support

14. On Going EMCP projects at Harari • Budget Reform • New Chart of Accounts • New Budget Structure • Forms • Cost Center Budgeting • BIS • Budget Calendar

15. On Going EMCP…cont’d • Accounts Reform • Double Entry Bookkeeping • Modified Cash Basis of Accounting • New chart of accounts • Commitment accounting • New forms, registers, ledgers and reports • Comprehensive reporting • BDA

16. Main Achievements • Budget Reform • Budget manual and module developed • Development of new budget classification • Cost center budgeting • New chart of accounts used for FY 98 budget preparation • Printing & distribution of forms • FY 98 budget approved and notified • Budget processed using BIS • 200 Budget experts trained

17. Main Achievements…cont’d • Accounts Reform • Accounts manual and module • New chart of account used for FY 98 • Recruitment of additional staff • Printing & distribution of forms • FY 98 accounts processed using new accounts system • 200 accountants trained

18. Performance of Public Bodies Medium Outstanding

19. Performance of Public Bodies …cont’d Poor Performance

20. Areas of Support required • Public Body Heads • Implement organizational structure • Match Capacity to Job • Conduct regular management meeting • Follow up monthly reporting • Finance Heads • Verify report • Manage and control Cash and Bank daily • Ensure account records are up to date

21. Areas of Support requiredcont’d • BOFED • Management of reform • Provide technical support • Verify reports • Consolidate Region accounts