Lagos State Government of Nigeria

1. Lagos State Government of Nigeria IFMIS Implementation - Lagos State Experience Presented by: Adewunmi Adekoya Director, Financial Information Systems Lagos State Treasury Office, Nigeria.

2. NIGERIA Location :- West Africa Administrative Structure :- 36 (semi-autonomous) States and Federal Capital Territory, Abuja. Population :- 134 Million Total Area :- 923,770 sq km Currency :- Naira Natural Resources :- Petroleum, Tin, Columbite, Iron Ore, Coal, Limestone, Lead, Zinc, Natural Gas.

3. LAGOS STATE The Economic Nerve-Centre of Nigeria • Location :- South West Nigeria • Administrative Structure :- Five (5) Divisions with 53 Local Governments. • Ministerial Bodies :- 49 Ministries and Agencies. • Population :- 14 Million • State Capital :- Ikeja. • Budget Size :- N 70 Billion (2004) approx. USD 53 Million • Workforce :- 47,000 Employees

4. VISION OF THE STATE The vision of His Excellency, the Executive Governor of Lagos State of Nigeria is to take advantages of advancement in Information Technology, to promote good governance with a view to enhancing the efficient management of Human, Materials and Financial resources of Lagos State Government of Nigeria.

5. OUR MISSION STATEMENT The Lagos State Government’s mission is to align Information Technology Strategies in line with the Strategies of the Government, by deploying the appropriate technology to harness its strategic initiatives and resources towards improved revenue generation and enhanced operational efficiency in the State.

6. INTRODUCTION • With the return of democratic structures in Nigeria in May 1999, the newly elected Governor of Lagos State set up 13 different committees to look at ways of moving the state forward. • One of the committees was the ICT Committee, which amongst her recommendations proposed the implementation of an Enterprise Resource Planning Solution. • In the December 2000, the State Government signed the contract for the implementation of the world-renowned Oracle Enterprise Resource Planning (ERP) software and Database solution in support of her e-Governance with Transnational Computer Technology of America. Messrs. Technology Derivatives Ltd were equally appointed as Project Managers for the State’s Global Computerisation Programme (GCP), LASG’s (Lagos State Government) IFMIS.

7. SCOPE OF THE GLOBAL COMPUTERISATION PROGRAMME • The Project was divided into two major parts: • The Backbone Projects and • High Impact Projects.

8. BACKBONE PROJECTS • These include: Oracle ERP Software and Database Engine; Infrastructure/Network, and Capacity Building. • THE ORACLE ENTERPRISE RESOURCE PLANNING (ERP) SOFTWARE AND DATA BASE SOLUTION • The Nine (9) modules of Oracle ERP implemented include: • (i)General Ledger (vi) Human Resources • (ii)Accounts Receivable (vii) Payroll • (iii)Accounts Payable (viii) Fixed Assets, and • (iv)Cash Management (ix) Purchasing • (v)Public Sector Budgeting  • INFRASTRUCTURE/NETWORKS • Phase I of the project involves creating the State’s Secretariat Campus (Alausa) Network whereby ten (10) Ministries were linked and made accessible to the Oracle Data Base by radio and by fiber optics. Metropolitan Area Network for all Tax Stations and Ministries/Agencies at the Old Secretariat and Lagos Island would be connected to Alausa by Radio link.Computer hardware and peripherals were also provided to Ministries and Agencies. • CAPACITY BUILDING • This covers the training and retraining of all cadres of officers in the State Civil services in Basic Computer Literacy and Oracle Applications under the User Learning and Adoption Strategy of the Global Computerisation Programme.

9. HIGH IMPACT PROJECTS • For Transparency, Accountability, Predictability and Participatory Democracy to be effective, high impact projects that would touch the lives of citizens in Lagos State and Nigeria at large must be in place. The High Impact Projects include: • - 35 Resource Centers with PC’s and other peripherals were established at various Ministries/Agencies. (Completed) • - Electronic Banking. (Completed) • - Document Image Management • - Lagos State Official Website (Lagos .Net) (Completed) • - Digital Village (At least 6 will be established) (On-going) • - Fixed Assets Authentication. (On-going) • - Geographic and Land Information • - Information Technology Education in Secondary school (On-going) • - LASG Education Management Systems (On-going) • - Medical and Hospital Database (On-going) • - MOT Administration • - Vehicular and Property Security • - Electronic Tax Clearance Certificate. (Completed) • - Statewide Identification. • - Cheque writing solution.

10. GCP Implementing Agents • Project Sponsor (The State Governor) • Project Steering Committee (Consisting of seven Honourable Commissioners, headed by the Finance Commissioner) • Project Management Team (Consisting of LASG, Implementing Consultants and Consulting Project Managers. Members are Directors in their respective offices) • Business Managers (Civil servants with good understanding of LASG business process) • Project Champions (Civil servants who are Computer Science Graduates) Each module consists of a minimum of two Business Managers,one Auditor, one Project Champion and one consultant each from the implementing firm and project managers.

11. EXPECTED BENEFITS OF THE PROJECT • Improved Service delivery to citizens through the provision of electronic governance facilities. For instance an activity that could have taken one (1) week to accomplish through manual process would now take one (1) day. •  2. To reduce the cost of running government through the introduction of Electronic Purchasing System, Payroll and Fixed Assets Management Systems. • 4. To increase the revenue base of the State Government through the efficient management of existing and new tax / revenue sources. • To ensure the efficient and effective management of government finances through the use of the General Ledger, Cash Management, Public Sector Budgets, Accounts Receivable, Accounts Payable and Treasury Management modules of Oracle ERM System.

12. PRE-IMPLEMENTATION STATUS • LASG Accounts were five years in arrears. • Hybrid Accounting Systems was in place. • Chart of Accounts had two segments consisting of six characters. • Data Processing was centralised. • Data were batched and processed monthly. • Very tedious procedures for preparing Final Accounts. • Vote Book balances were unreliable. • Over –Expenditure could not be detected until years later. • Dearth of qualified Accountants. • Existence of Ghost Workers.

13. The Journey So Far

14. GL Team implementation efforts within the first year. Cleared backlog of 5 years accounts using the Legacy System. Developed the New Chart of Account Structure consisting of 7 active segments and one inactive segment reserved for future use. The segments are Fund (2), Ministry (3), Directorate (5), Section (3), Location (5), Programme (4) and Account (5) thus making 27 code characters in all. Conversion of the Head and Subhead codes to Chart of Account codes Recoding of Year 2001 Vouchers and Preparation of 2001 Final Accounts Transformation of Final Account Directorate into Financial Information Systems Directorate. Training of Account Officers in Ministries/Agencies.

15. MAJOR ACHIEVEMENTS OF GCP Backlogs of five (5) years (1996 – 2000) Accounts were cleared. 2001 and 2002 Accounts prepared using Oracle GL Statutory audits up to date. Preparation of 2003, 2004 and 2005 Budgets using Oracle (PSB). Elimination of fictitious names from Payroll. Reduction and detection of Payroll Fraud. Online connection of Tax Offices to the Oracle Application. Online connection of all Ministries/Agencies Training of End Users (This is ongoing). Training of Technical Staff Increased Revenue Generation from =N= 0.6 billion per month to =N= 3 billion per month.

16. PHASE TWO OF GCP • The second phase which started in January 2003 and was to cover: • Networking of sixteen (16) Tax Stations and all other Ministries/Agencies not covered in Phase I. (Completed) • Procurement of additional Computer Systems and peripherals- 2500PCs is anticipated. (About 1,000 PCs bought) • Training of all classes of Users. (User Learning and Adoption ) (On-going) • Implementation of additional two (2) Oracle Financial Modules (Treasury Management and Inventory/Order Management Modules). (Set up done awaiting deployment)

17. Status of Oracle Modules Implemented GL - Set-up completed, fully operational. PSB - Set-up substantially completed, Personnel Budgeting still outstanding. AR - Set-up partially completed, integration with Revenue Collection Stand-alone module still outstanding. AP - Set-up completed, gradual deployment being done. Five Ministries covered so far. FA - Set-up completed, yet to be taken over. PO - Set-up partially completed, difficulties in streamlining procurement procedures.

18. CE - Set-up completed, yet to be used because of AR status. HR - Set-up partially completed, Recruitment, Personnel Management etc yet to be set up. Payroll - Set-up partially completed, used to process salaries since May 2003. Pension is just about to be incorporated. Major issue here is RETRO-PAY, this is yet to be finalised. Treasury - Set-up completed, yet to be deployed. Inventory - Set-up completed, yet to be deployed. RETRO-PAY : A tool Oracle uses in calculating salary arrears.

19. Overlapping ministerial responsibilities on human resources issues. Key Officers resigning while implementation was on. Multiple Treasury Accounts Project Managers had no functional knowledge of the application. Ownership of HR module now vested in the Office of the Head of Service. Proposal made to motivated remaining officers. - Yearly overseas training - Separate salary structure - State Awards Over 600 bank accounts, no conclusion could be reached on how to achieve Single Treasury Account. GCP CHALLENGES

20. Inadequacy of the Financial Regulation. Power outages. Resistance to change - Managing change from batch processing to on-line processing. - Mentally Lazy Accounts Officers. Integrating Stand-Alone Systems. Review of the FR just completed. Provision of inverters that can provide back-up power supplies for 24 hours. Inverters require very minimal maintenance cost. FIS Directorate empowered to withhold monthly allocations of erring ministries. Attempts to integrate the e-Revenue Collection and Banking Solution has been delayed by frictions between the software vendor and the Implementing Consultants. This has delayed the finalisation of 2002 Accounts until the resolution of above friction, a few months ago.

21. Issues on cash basis of accounting. - completeness of information on fixed assets tracked. - full functionalities of AR module cannot be used. - inability to account for liabilities with the integrated systems. Fixed Assets module only used to track fixed assets. AR set up on accrual basis. Journal raised to NIL out Taxes Receivable as at the period/year end and journal reversed on 1st day of the following period/year. Stand alone solution would be required to manage debts (liabilities).

22. Thank You!