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Programme-level Multi-Year Funding Commitment

Version 3. Simplify MyPBAS related operations and Ensure Multi-Year Planning & Budgeting in Programmes toward FY14 Budgeting Process. Programme-level Multi-Year Funding Commitment. Blue: added in version 2 Green: added in version 3. Background.

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Programme-level Multi-Year Funding Commitment

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  1. Version 3 Simplify MyPBAS related operations and Ensure Multi-Year Planning & Budgeting in Programmes toward FY14 Budgeting Process Programme-level Multi-Year Funding Commitment Blue: added in version 2 Green: added in version 3

  2. Background • When LEAP was introduced in 2005, Programme-Projects structure started. (previously it was Project-its components) • Methodologies of Programme/Project Planning/Designing and Management became well organized. • Programme/Project Financial System became complicated • Budget files, PBAS entries, C/F and Project Core and Logframe Financial Report became 5 times • But, Donor restriction (mainly SP) is not changed • If same Programme, it seems that many SOs have flexibility of fund allocation among Projects • WV’s Development Programme Approach (IPM adoption) requires more flexible operation to work with local partners Not changing Programme-Projects structure in Development theory and accountability-level, change to Programme-level Commitment as one figure

  3. Where we stand now • Jan 21/22: Conducted two discussion WeBEX inviting SO IPG heads, SO IPG Finance heads, SDOs, RFDs and RFMs. Feedback received from 8 SOs, 2 ROs and 10 NOs including Operation/Programme, Ministry Quality and Finance. • Feb 20: Discussed in GFFT call (GC Finance, RFDs, SO IPG Finance heads) inviting GFO and DPE/IM. Feedback received from 7 SOs and 2 ROs. The most of feedback required clarifications on the proposed new business process. • The direction to simplify MyPBAS operation with the related works was endorsed by SO&ROs/NOs, and especially NOs appreciate more flexibility so that they can accommodate field-level timely needs. • Attached feedback summary focus on key concerns/issues, cartelized by 5 areas, and add comments/clarification with the name of groups to follow up. Texts in blue are based on the feedback after GFFT call. • SO internal operation issue: SP economic model/PCPY based approach, SP Reserve management • Business protocol: Loosing SOs’ control power at project-level, too much flexibility • Programme financial management issue: why only for SOs, overspending risk, poor agreement status of PDD/MY Budget, NOs capacity for better budget management • Roll-out • Clarification: meaning of “commitment”, accounting, etc. • Based on the additional suggestions, this 3rd version is developed.

  4. Scope • The funds which have no specific donor restrictions on project allocation under the same Programme • Mainly Sponsorship • But not limited, e.g., PNS general funding which has no donor restrictions. • Grants (Gov’t, Multi, PNS) are out of scope • Funding commitment which is tied with the specific activities should be made in a separated MyPBAS document (individual T4 code) by SOs (no change) • E.g., FY14 ADP total budget of $500K is funded by Sponsorship mainly but a part of Education project is funded by PNS Grant with $50K. • SO enters $450K to SMP and $50K to Education project in MyPBAS.

  5. Pre-conditions & Directions • Pre-conditions • No design changes on IT systems such as • MyPBAS DB • SunSystem: v6 is now roll-out • Horizon: system linked with LEAP budget template • LEAP Budget Template: v10 is not yet fully implemented • Project Core & Logframe Financial Report Template: new template starts from FY13 Q2. • No structure change on Programme and Project • Directions • Simplify, Reduce not-value-added work • Keep project-level accountability • Ensure the concept of Multi-Year Planning & Budgeting in Programme • Give more flexibility of annual cashflow and budget reallocation among projects under the same programme, but no overspent in each year-end per programme. • Ensure responsibility of line management in NOs and ROs for programme quality assurance functions aligned with one Operation one Organization.

  6. Overview MY Budget Budget Framework Project Core & Logframe Financial Report MyPBAS SO enter one big $ NO enter five $ over lifecycle Annual Budget ITD Budget YTD Actual ITD Actual Revised CY Budget Living Budget Inception-to-date (ITD) Budget/Actual is cumulative budget/actual of the phase. If in 3rd year of the current phase, ITD budget/actual is total budget/actual from 1st year to 3rd year.

  7. Budget Types • Multi-Year Budget (MY Budget) • This is 3 to 5 years of lifecycle budget created along with Programme Design Document (PDD). • MY Budget is be kept over 3 to 5 years of lifecycle unless PDD is revised or material budget change such as caused by exchange rate, inflation, etc. • This will be used as Inception-To-Date (ITD) Budget. • Revised Current Year(CY) Budget • This is one-year (CY) updated budget along with revised one-year (CY) Detailed Implementation Plan (DIP) • Revised CY Budget reflect previous year’s accomplishments. For example, if there are some remaining activities but need to carry out, those activities are included in the Revised CY Budget. • It is called “Annual Budget” in Project Core & Logframe Report. • Both use LEAP Budget Template (currently v10.1)

  8. Key Business Process (1)

  9. Key Business Process (2)

  10. Example - MyPBAS 440(70+370) is the cap for NO for Year 2 total budget for Project A & B

  11. 3-Year in MyPBAS

  12. PCFR and NO CF Explanation Forms CY SS Actual MY Budget (= Cumulative amount of PBAS fresh commitments) Revised CY Budget

  13. Transition Plan • Projects that have SO Forecasts at Project-level in FY12 MyPBAS DB (up to FY15 data) • If SO Forecasts are based on the agreed PDD/MY Budget, keep them at Project-level and simply copy to SO approved commitments until FY15. • If SO Forecasts are not the final agreed amounts, • Either keep them at project-level forecast but reflect agreed PDD/MY budgets at project-level, and copy them to SO commitments at project-level (up to FY15data), or • Change to Programme-level forecast in FY14-16 planning and budgeting process. • From FY16 MyPBAS data, all SOs Forecasts are shown under one project with Programme-level total amount. • Projects that have SO Forecasts at Programme-level in FY12 MyPBAS DB • Keep Programme-level but update to the agreed the total Programme-level amount. • NOs keep to reflect agreed MY Budget to MyPBAS at project-level, and won’t change to the revised CY budget from FY14 MyPBAS. • NOs upload agreed MY Budget into SS budget ledger as ITD Budget from FY14. • If current phase is from FY11-15, upload FY14-15 ITD budget.

  14. Pros and Cons

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