1. Transition to the (new) Business Model
Annual Meeting
Bogor, 26 September 2016

2. Outline CIFOR Funding Transition A view outside CIFOR
Transition to 2017
Changes, challenges, expectation and readying for the future

3. Remember this from last AM?

4. Transition to

5. Transition to 2017.. a different perspective

6. A view outside CIFOR

7. Evolution of CGIAR Funding 2011-15
W3/B funds in 2015 totaled 711, CG fund % of funds raised by Centers.
Source: CGIAR 2015 Financial Report

8. Center Performance 2015
Source: CGIAR 2015 Financial Report

9. Indirect Costs 2015
Source: CGIAR 2015 Financial Report

10. Center Financial Stability 2015 (adequacy of reserve in days)
Source: CGIAR 2015 Financial Report
CIFOR: Unadjusted for deficit in

11. Center Liquidity 2015 (working capital in days)
Source: CGIAR 2015 Financial Report

12. Transition to CIFOR 2017

13. The Transition Transition to 2017 (first cut) FY 2012
USD 37.7m revenue, W1/2: 7.1m
FY 2012
USD 33.8m revenue, W1/2: USD 14.9
Ihave tried to compare years where our funding was quite similar. In 2012, we had about USD 34m revenue. We expect 38m in However, in 2012 we had almost USD 15m W1/2 and in 2017 we expect about USD 7m. The nature of funding is quite different. In 2012 our indirect cost base was 6.4m. Our indirect costs in 2017 are likley in region of USD 5.7m. RS is included in direct costs.
W3/B finances only 9-10% Indirect costs. That has not changed. So a large chunk of it has to be financed by W1/2 and unrestricted. This was a high of 30% in Based on our funding forecast for 2017, this will be 41% of W1/2 in 2017.
W1/2 and W3/B cover RS costs

14. CIFOR Revenue Forecast 2017
USD 37.7m funding forecast
By Source of Funding
By distribution
OH recovery is 9% and RS is 3%

15. RS Costs 2017 (1st estimate) RS costs are USD 5.57m
Our global presence alone costs USD 2.47m
IT and Systems support costs another USD 0.8m
RS recovery from W3/B is only USD 1.3m

16. IU Costs (1st estimate)
IU costs are USD 5.67m

17. The Transition: some key changes
We are already raising 64% more W3/B than in 2012
We can only charge up to the audited OH to W1/2
We are at present charging way beyond that
Research Support costs will need to be covered by W3/B
There are not enough funds for co-financing
Uncollected CSP will have to be financed by Center funds

18. The Transition: what we need to do
Fund raise : a constant and strong pipeline
a combination of big and small proposals/projects
Guidelines to assist with proposal budgeting
Staff time budgeted adequately against grants
OH recovery from W3/B may remain around 10%, thus:
Be creative in converting some of our costs (RS and Indirect) into direct
Find ways to charge CSP as a direct cost
Provide adequate time to assist preparing and reviewing proposal
Budget and promise to deliver only what is possible within financial limitations of the grant
Deliver on our commitments

19. The Transition: what to expect
Compliance matters will take front seat
e.g. Financial Accounting guidelines in EU International Co-operation and Development projects (PAGODA guidelines)
US NICRA
Donor conditionality will likely drive how we spend the funds we receive; almost all funds we now receive are with restrictions
Review and understand donor guidelines:
What are eligible costs and financial reporting requirements
What are staff cost accounting requirements
What are requirements to account for indirect costs
Additional audits (internal and external)
Review and implement audit / 7 pillar recommendations
Financial Reporting
Timely financial reporting and invoicing
Monitor AR and follow up of receivables

20. Ready(ing) for the transition
A new Strategy linking to the SDGs
A new org structure
The RDP team being strengthened
Operational policies, procedures
Key business processes (myCIFOR)
RDP
PMC HR
Travel
Event Management
Reporting
Etc.

21. Thank You!
It is obvious Research Costs (incl. Staff costs need to be met from restricted grants)