IFMS Scope & Implementation Strategy

Ethiopia

By Tedla Mulugeta IFMS Project Manager

Nov. 11,2004

Historical Perspective

Legacy Systems 1960-1996– Budget, Disbursement & Accounts System– Payroll System– Debt Management System– Budget Authorization– Budget Appropriation– Trade Statistics etc.

Problems Faced

• Lacks Accuracy & Not Timely :- Historical Data

• Delay in closing the yearly Books of Account

• Not Integrated

• No Standardization :- Different programming languages

• Requires highly Qualified Staff

• Huge Maintenance Cost

• Limited Users

• Highly Centralized

A Need For Integrated System

Highly Improved technology (1990s)– Affordability of PC technology– The Power and Ease of use– User friendly systems– Internet, LAN & WAN expansion

Government Initiatives (1996) The Government Embarked on Civil Service

Reform Program (5 programs)– MoFED is given responsibility to undertake The Public

Expenditure Management & Control Sub Program • 8 Projects were designed under the subprogram

– Legal Frame Work– Budget Reform– Accounts Reform– Cash Management– IFMS– Internal Audit– External Audit– Accounting Profession

Project Proposal for IFMS IFMS was delayed until The Budget & Accounts

Reforms are well underway. EU agreed to fund the Design study and Pilot

Implementation of IFMS. PWC was awarded to undertake the Design study.

– Main Recommendations of the Consultant• A Need for Single treasury Accounts (500)• A move from single Entry to double Entry Book keeping• Buy off the shelf Public Finance Package• A need for a reliable Telecommunication Infrastructure.• Revisiting the Legal frame work • Capacity building both at the Federal & Regions etc.

Acceptance of The Recommendations

– Most of the recommendations were accepted by the steering committee

– The Business process & Tender Dossier prepared by the Consultant

Phase Approach for Implementation 1st Priority Area

– Core budget & Accounting• General Ledger, Account Receivable

• Account Payable, Budget Execution

– Revenue for public bodies– Cash Management– Interface with National Bank System

2nd Priority Area– Procurement– Interface with Payroll System– Interface with Budget Preparation System– Interface with Debt Management System– Interface with Inland Revenue System– Interface with Customs System

3rd Priority Area– Inventory System– Asset Management System– Budget System

Merger of Ministries (2001)

Ministry of Finance & Ministry of Economic Development merged (MoFED)– Change of Management

Devolution of Power to The Woredas (Districts) CFAA reports for Re-assessment of IFMS Fund Approved for the Pilot on Nov. 2002 Agreement Signed With MoFED on Sept. 2003 Supervisory Consultant Arrived on October 2004

Sense of Urgency

Top Priority of The Government– Expanding The Telecommunication

Infrastructure• Broad Band Connection For Major Cities

– Currently available in 64k, 128k, 256k & 512k

• Woreda Net connection:- each Woreda (district) administration bureau is connected with 512k Band width ( 679 )

• School Net Every Government High School (9-10 Grades) in the Country are Connected

The Challenge A Head Federal :- 173 budgetary Institutions

– Over 2000 trainees on Basic Computer Skills, & on the Financial Package– Over 1730 Nod Connections– Purchase of Computers, UPS,Printers, Switches etc.– Establishing 10 training Centers– Recruiting and Intensive training of 30 trainers– WAN connectivity for 173 Budgetary institutions and The

National Bank – For over 30 IT specialized training including from the Regions– Over 50 Existing staff Intensive training on the package– Technical Support

Regions, Zone & Woredas(districts) Nine Regions, Two City Administrations& 679

Zone/Woredas– Over 4500 trainees on Basic Computer Skills & on the use of Financial Package– Over 4500 Nod Connections– Purchase of Computers, UPS,Printers, Switches etc.– Establishing 40-50 training Centers– Recruiting and training of 120 trainers– Connection with the Woreda Net & Broad Band– Technical support

Plan Of Implementation Tender Semi- Turn Key for major Hardware, Operating System &

Public Finance Package Computer Basic Training & LAN installation separate tender

(involving all capable companies) Purchase of Computers,UPS & Printers Contract Agreement with the Ethiopian Telecommunication & ICTA Awareness Seminars & Workshops for top management and

stakeholders. Attractive salary for Contract employees (2yrs) Top- ups for all employees involved in the Implementation of IFMS Establishing Project team in every implementation sites Establishing supervisory team at Federal & Regional level First Priority Area complete role out of the system by December 2005

Thanks!