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Review of a Partner’s Financial Management Capacity

Review of a Partner’s Financial Management Capacity. Cairo, March 2005. Why assess Partners?. Development objective Identifies strong or weak capacity (e.g., reliability of financial reports, safeguarding assets) Fiduciary objective To mitigate risks. Key principles.

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Review of a Partner’s Financial Management Capacity

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  1. Review of a Partner’s Financial Management Capacity Cairo, March 2005

  2. Why assess Partners? • Development objective • Identifies strong or weak capacity (e.g., reliability of financial reports, safeguarding assets) • Fiduciary objective • To mitigate risks

  3. Key principles • Transparency—participation of the partner • Utilize all existing materials • Balancing risk and administrative burden • Share results with partner and Government Coordinating Authority • RC office maintains list of assessments and audits

  4. Who and when • All national implementing partners (priority to shared partners—done jointly) • Latest before Annual Work Plan signed • If changes to environment (leadership, new procedures, reviews, etc.)

  5. Exemptions and special cases • Optional when combined budget under US$100,000 or amount to be determined locally • Crisis situations

  6. How • Priority to common partners • partners participate in process, Gov’t coordinating authority informed • Identify all available information (Global Fund assessments, NEX audits, etc.) • Short checklist if history with Agencies • Full assessment if necessary • Result: common rating

  7. Who assesses • Qualified accounting firm (recommended) • Key concept: Independent of partner

  8. Checklist ‘A’ (simple assessment) • Worked with partner for past 2 yrs • Volume expected to remain same • Same management • Same programme type • No major ‘incidents’ • Good internal controls • Timely financial reporting

  9. Checklist ‘B’ (detailed risk assessment) • Status of partner • Funds flow • Staffing • Accounting policies and procedures • Internal Audit • External Audit • Reporting and Monitoring • Information systems

  10. Reporting the findings • 3-4 pages excluding annexes • Overall rating (high or low risk) • Summary of methodology used • Description of capacity in each area • Description of risks • Recommendations for mitigating risks • Completed checklist

  11. Discussion • Implications of introducing assessments • How to jointly manage and coordinate assessments • What issues envisaged

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