1 Public Financial Management (PFM) Reforms Progress GATABAZI E. Thomas Accountant General 22 nd November 2006

2 Presentation Outlines 1.Reforms Coordination 2.PFM Legal Framework 3.Capacity Building 4.GoR Consolidated Financial Statements 5.Treasury Management 6.Integrated Financial Management System (IFMS) 7.PFM Trust Fund

3 Reforms Coordination I.National PFM reforms Steering Committee. II.Technical Secretariat. III.5 Sub-committees of the steering committee.

4 Steering Committee National PFM reforms Steering Committee re-established (June 2006); members: MINECOFIN, MINALOC, AOG, RRA, BNR& NTB - Initially Meeting weekly on every Wednesday. - Mandate:  Monitor & oversee reforms progress.  Produced a 3-yrs PFM action plan ( approved by cabinet on 6/9/2006)

5 Reforms Coordination..  Technical Secretariat: Mandate: – To support the steering committee. – Lead by a PFM reforms coordinator ( started on 1 st Nov), The consultant works full time. - The Secretariat will be made up of focal points from different MINECOFIN departments.

6 Technical Secretariat.. Among the main roles:  Coordinate, monitor and evaluate and report to the Steering Committee on the performance against the PFM reforms Action Plan.  Prepare agendas and meetings of the Steering committee.  Once the Secretariat has been established and is full functioning the Steering committee will be meeting monthly to review progress.

7 Other arrangements proposed: - 5 Sub-committees: i.Intergovernmental Fiscal Relations ii.Integrated Financial Management Systems (IFMS)/ ICT iii.Financial Management and Accountability (Accounting, Auditing & Treasury) iv.Procurement v.Planning & Budgeting - Quarterly meeting with Representatives from Donors (to start next year)

8 PFM Legal Framework  The long waited OBL (for 3yrs) was gazetted (12 th Sept 2006)  Financial Regulations were approved by Cabinet on 11 th Oct 2006, to be gazetted soon.  Financial Management & Accounting manuals of policies & procedures have been produced to be circulated to end users.  Conduct workshops for Senior Budget Managers/ mid-level officials on OBL & FRs ( mid-Dec, 2006)

9 Capacity Building Training of accountants and internal auditors  The objective is to create sustainable capacity for public accounting and internal audit in Government Institutions  The training of accountants and internal auditors is carried out in the framework of the “Rwanda Expertise Scheme (RES)” - a scheme designed under HIDA to provide rare and unique skills in the economy

10 Training of accountants and internal auditors…..  The training is two-fold: short-term (skills enhancing on Rwanda Public Accounting System) and long-term (on ACCA)  The ACCA Certification was chosen due to its presence in Rwanda at SFB and its global qualification appeal  Started in May 2006 and First set of professional examinations is December 2006 sitting. {220 are on ACCA part 1}.

11 Training of accountants and internal auditors….  Training is conducted on part time basis in the evening for those working in Kigali, to avoid disruption of their daily work.  For upcountry employees, it is on “Block Release” a full- week ( 3 rd week of each month)

accounts consolidation  Objective is to produce the 1 st GoR Consolidated Financial Statements (2006)  A private firm (PwC) has been contacted (we got a N/O of the negotiated contact from WB yesterday).  The firm will support our accountants to: – Establish opening balances as at 1 st January 2006 – Write books of account for 2006

accounts consolidation.. To prepare GoR’s consolidated financial statements as at 31st December to be produced & Submitted to OAG by 31st March The expectation is that the Consultancy produces 2006 statements & leaves lasting capacity to prepare FSs for subsequent years.

14 Treasury Management  Cash Management: −A 3-month cash flow plan was adopted since 1 st Jan 2006, and became spending limit of the budget agencies. −Budget agencies have gained pace and are now used to preparation of quarterly cash flow plans

15 Treasury Management…  Establish Single Treasury Account: – A system of zero balance drawing bank accounts is operational and all government agencies are now using Zero balance sub accounts. – All government dormant accounts from BNR were closed, next phase is for bank accounts in commercial banks. –All districts dormant accounts were closed.

16 Treasury Management…  Debt management system: – MINECOFIN & BNR debts data base have been reconciled. (Q1, 2006 → ) – Update the existing database and conversion to DMFAS ver 5.3 (Q4,2006) – Train staff on DMFAS ver 5.3 and initiate consolidation link btn MINECOFIN& BNR (Q4,2006)

17 Integrated Financial Management System (IFMS) It is expected that the implementation of the Smartgov project will in the medium term transform into an Integrated Financial Management System (IFMS) model project. IFMS will consist of core expenditure management system (EMS) modules, including budgeting, accounting and cash management,

18IFMS…. IFMS will be interfaced with other GoR systems like revenue, public debt management and payroll. Currently: −BudgetMaster (Budget module) was used to prepare the 2006 Budget. It is also used for reporting and monitoring of budget execution since 1st January −PublicBooks (Accounting module) is an accounting system, it needs further development, more system specifications are being worked on, it is expected to be available for bookkeeping 2008 transactions.

19 PFM Trust Fund  It is a fund to support PFM activities.  It is administered by the World Bank through HIDA under (Public Sector Capacity Building Project - PSCBP)  It will allow for a harmonized financing approach for PFM reforms  The First PFM Trust Fund Partners include the EU, DfID and the World Bank’s PSCBP

20 PFM Trust Fund….. Objective: The objective of the trust fund is to support the GoR’s PFM reforms program Activities 1)Building sustainable capacity for public accounting and internal audit under the Rwanda Expertise Scheme (RES)

21 PFM Trust Fund….. 2)Support Coordination, monitoring and evaluation of PFM reforms: i. The operations of a PFM reforms secretariat and steering committee ii. Technical assistance to the annual sector public expenditure review process; iii. An annual evaluation of PFM based on the Public Expenditure and Financial Accountability (PEFA) Performance Measurement Framework.

22 PFM Trust Fund….. 3)Supporting the development of the SmartGov system modules through system development, testing, and training of responsible staff. 4)Capacity building support for the reform of the procurement system, through training and technical assistance. 5)Increasing the capacity of the Office of the Auditor General through training

23 END OF THE PRESENTATION THANK YOU