Oromia Region Awareness Workshop February 2006

2 Structure of Presentation Background and Objectives of EMCP Components and Program Management of EMCP Status of Reforms Evolutionary Approach to Reforms Benefits of Reform Reform Activities in Oromia Key Achievements Risks facing Reform Support required from senior officials

3 Background Expenditure Management and Control Sub- Program is one of the five sub programs of the Civil Service Reform

4 Objectives of EMCP To strength the capacity of the public financial management system to manage public sector financial transactions To improve the capacity of public sector managers to use information to permit better planning, management and control To develop on the platform that budget allocations are driven by policy

5 Components of EMCP Legal Framework Budget Reform Accounts Reform Expenditure Planning Internal Audit External Audit Cash Management Financial Management Information System Human Resource Development

6 Program Management National Steering Committee EMCP Coordination Office Regional Steering Committee Regional Reform team

7 RegionBudget ReformAccounts ReformExpenditure Planning Federal SNNPR Tigray Amhara Oromia Ben/Gumz Harari Afar Somali Gambella Adis Ababa Dire Dawa Status of Reforms

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9 Benefits of Reform Legal framework established Accounts backlog reduced to one year Budget approved and notified on time Budget & Accounts manual/module developed and translated (Amharic, Oromiffa, Somali & Tigrigna) Financial Information System developed and used (BIS/BDA) 55,691 staff trained

10 Benefits of Reform…cont’d Standard chart of accounts used Budget structure standardized Improved cash and management control Development partners confidence increased o Direct budget support reporting o Debt write off o Ramping up financial support

11 Improve information Increase transparency Reduce costs Provide more timely information Smooth accounts work flow Reports flow easily from accounts records All accounts information kept at unit Modernize public sector financial systems Meet international standards Benefits of Reform…cont’d

12 Reform Activities in Oromia Budget Reform o New Chart of Accounts o New Budget Structure o Forms o Cost Center Budgeting o BIS o Budget Calendar

13 Reform Activities in Oromia…cont’d Accounts Reform Double Entry Bookkeeping Modified Cash Basis of Accounting Single Pool System Single Treasury System New chart of accounts Commitment accounting New forms and reports Comprehensive reporting BDA

14 Key Achievements Budget Reform Budget manual and module developed Development of new budget classification Cost center budgeting New chart of accounts Printing & distribution of forms FY 98 budget approved and notified Budget processed and notified using BIS at region and zone Budget book printed using BIS 6,135 budget experts trained

15 Key Achievements…cont’d Accounts Reform Accounts manual and module New chart of accounts used Recruitment of additional staff Printing & distribution of forms FY 98 accounts processed using new accounts system in all jurisdictions 5,275 accountants trained

16 Key Achievements…cont’d Accounts Reform Closure of FY 1996 Accounts Implementation of Single Treasury System Installation of BDA 3 B at region & zones

17 Risks facing Reform Reassignment of trained staff Matching capacity to Jobs Policy decisions not implemented Unstable reform environment Future Sustainability n

18 Areas of Support Required Cabinet Allocate financial resources to support and operate the new systems Monitor progress of reform at Cabinet Meetings

19 Areas of Support Required …cont’d Office Heads Implement organizational structure Match Capacity to Job Minimize staff reassignments Conduct regular management meetings Follow up monthly reporting deadlines Accounts/Treasury Team Leaders Check adherence to accounting cycle Verify monthly reports Control Cash and Bank balances daily Ensure account records are up to date

20 Areas of Support Required …cont’d BOFED Should Lead the Reform What aspects? Policy issues Technical issues Management and operational issues Why? Enhance quality of the technical design Ensure timely and quality implementation Minimize risk of failure Ensure future sustainability