Stop TB workshop on grant negotiation and implementation The workplan and budget: from proposal to implementation Geneva, 11-14 December
Agenda 3 main topics 1. How do we move from workplans and budgets in the proposal to the grant agreement? 2. Lessons learnt from Round 6 3. Enhanced financial reporting
Agenda 3 main topics 1. How do we move from workplans and budgets in the proposal to the grant agreement? 2. Lessons learnt from Round 6 3. Enhanced financial reporting
From proposal to operational workplan and budget (1) Workplan Budget $$ Board Approval $$ What is different? Workplan Budget $$ Grant Agreement $$ Slide 4
From proposal to operational workplan and budget (2) Workplan Budget $$ Board Approval $$ What is different? Workplan Budget $$ Grant Agreement $$ Summarized info for yrs 3-5 State key assumptions, unit costs x quantities Year 1& 2 detailed budget Workplan and budget should be integrated Budget and workplan should follow program stategies Budget summary by cost category & SDA Slide 5
From proposal to operational workplan and budget (3) TRP clarifications Possible routine changes Changed implementation arrangements (PR/SR etc ) Workplan and budget level of detail Negotiation on the performance framework LFA assessment recommends capacity building LFA and secretariat budget review
From proposal to operational workplan and budget (4) What if? There are major changes in macro-economic, contextual or programmatic issues? What is the effect on the budget/workplan? Examples: major foreign exchange swing civil strife or other force majeure a significant increase or reduction in the cost of drugs a more effective way to deliver services Slide 7
From proposal to operational workplan and budget (5) If all else fails?? Explore budget acceleration Explore other sources of funding Re-allocate budget (use possible savings) Retain proposal targets Inform FPM Slide 8
Agenda 3 main topics 1. How do we move from workplans and budgets in the proposal to the grant agreement? 2. Lessons learnt from Round 6 3. Enhanced financial reporting
Lessons learnt from Round 6 grant signing (1) Putting the budget in program context Weak link to previous rounds Mis-alignment of budget with targets in grant agreement Lessons where activities overlap clearly identify any budget overlaps good co-ordination between finance and program staff budget follows proposal strategy Unexplained variances from proposal budget ensure good understanding of proposal budget (consultants?)
Lessons learnt from Round 6 grant signing (2) Explaining the budget Budget not detailed enough (lumps sums, supporting workings) Lessons clarity the key (esp big items) better more detail than less avoid lump sums supporting workings Lack of a clear budget narrative high level analysis of the budget (words, not just numbers) Inconsistent assumptions look for logical relationships quality review bef submission
Lessons learnt from Round 6 grant signing (3) Special cases Salary supplements/ retainers Social marketing/cost recovery schemes Lessons sustainability and equity issues justify + CCM approval include in budget if possible explain reinvestment of revenues Management fees/ overheads avoid business as usual approach (fixed %) define costs to be covered
Agenda 3 main topics 1. How do we move from workplans and budgets in the proposal to the grant agreement? 2. Lessons learnt from Round 6 3. Enhanced financial reporting
Why enhanced financial reporting (1)? Increased focus on financial accountability and transparency cost effectiveness value for money comparative advantage
Why enhanced financial reporting (2)? Eg: Phase 2 request: TB grant Indicator 1. No people started on a DOTs course 2. No people receiving BCC messages Target 500 20,000 Actual 350 200,000 % 70% 1000 % Narrative Some delays in procurement caused the deficit More effective way of reaching people was used Cost category Budget Actual % 1. Drugs & commodities 500,000 200,000 40% 2. Training and communication materials 350,000 100,000 30% How has this grant performed?
Why enhanced financial reporting (3)? Why should Financial Reporting be strengthened? Support to Grant Management Better informed funding decisions: link financial information with programmatic performance; more detailed financial breakdowns for variance analysis. Risk Management Increased ability to pin-point areas of financial risks: where are the largest proportion of funds being allocated? are the funds rightfully spent in the right areas? are there financial bottlenecks? External Reporting & Resource Mobilization More information on where the money is going and how it is being spent. critical information for resource mobilization; pioneering transparency and accountability in international development. Request at the 13 th Board to strengthen Financial Tracking (April 2006)
Enhanced financial reporting project (1) Main Outcomes of Pilot-test & Feedback from PRs and FPMs PRs FPMs DIFFICULTY Not Difficult - 57% Very Difficult - 7% N/A USEFULNESS Very Useful - 54% Useful - 31% Not Useful - 15% Useful - 83% Not Useful - 17% TIMING Grant Cycle Year - 44% Disbursement Cycle - 39% Calendar Year - 17% Grant Cycle Year - 67% Disbursement Cycle - 33% Calendar Year - 0%
Enhanced financial reporting project (2) Solution for enhanced Financial Reporting ❶ Each grant should report more detailed financial information at least annually on the Grant Cycle Basis (i.e, Month 12, Month 24, etc) and at Phase 2 (i.e, Month 18) ❷ Three financial breakdowns: - Cost Category (HR, infrastructure, training ) - As Per Round 7 - Program Activity (Objectives, SDAs, ) - Implementing Entity (name and type - NGO, MoH, ) ❸ Reporting of Budget, Expenditure and Variance Analysis. ❹ All reported information should be reviewed by the LFA. ROLL-OUT Compulsory from Jan. 08
Enhanced financial reporting: template (1) HIV/AIDS FINANCIAL TRACKING FORM Country Grant No. PR Currency Reporting Period A- BREAKDOWN* BY EXPENDITURE CATEGORY PLEASE REFER TO THE "GUIDANCE FOR COMPLETING The "TOTAL" rows in Table A, B and C will have a RED background if the amounts in each table Expenditures Vs. Budget Cumulative Budget & Expenditures Expenditu Reason for Cumulative Cumulative # Category Budget res Variance Variance Budget Expenditure Variance 1 Human Resources 0.00 0.00 0.00 0.00 0.00 0.00 2 Technical Assistance 0.00 0.00 0.00 0.00 0.00 0.00 3 Training 0.00 0.00 0.00 0.00 0.00 0.00 4 Health Products and Health Equipments 0.00 0.00 0.00 0.00 0.00 0.00 5 Medicines and Pharmaceutical Products 0.00 0.00 0.00 0.00 0.00 0.00 6 Procurement and Supply Management Costs 0.00 0.00 0.00 0.00 0.00 0.00 7 Infrastructure and Other Equipment 0.00 0.00 0.00 0.00 0.00 0.00 8 Communication Materials 0.00 0.00 0.00 0.00 0.00 0.00 9 Monitoring and Evaluation 0.00 0.00 0.00 0.00 0.00 0.00 10 Living Support to Clients/Target Population 0.00 0.00 0.00 0.00 0.00 0.00 11 Planning and Administration 0.00 0.00 0.00 0.00 0.00 0.00 12 Overheads 0.00 0.00 0.00 0.00 0.00 0.00 13 Other 0.00 0.00 0.00 0.00 0.00 0.00 TOTAL 0.00 0.00 0.00 0.00 0.00 0.00
Enhanced financial reporting: template (2) B- BREAKDOWN* BY PROGRAM ACTIVITY Service Delivery Area Expenditures Vs. Budget Expenditu res Reason for Variance Cumulative Budget & Expenditures Cumulative Budget Cumulative Expenditure # Macro-category Objectives Budget Variance 1 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 2 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 3 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 4 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 5 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 6 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 Please Select Select 0.00 0.00 0.00 0.00 0.00 0.00 TOTAL 0.00 0.00 0.00 0.00 0.00 0.00 Variance C- BREAKDOWN* BY IMPLEMENTING ENTITY Expenditures Vs. Budget Cumulative Budget & Expenditures Type of Implementi ng Entity Expenditu res Reason for Variance Cumulative Budget Cumulative Expenditure # PR/SR Name Budget Variance 1 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 2 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 3 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 4 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 5 Please Select Please 0.00 0.00 0.00 0.00 0.00 0.00 Please Select Select 0.00 0.00 0.00 0.00 0.00 0.00 TOTAL 0.00 0.00 0.00 0.00 0.00 0.00 Variance
Enhanced financial reporting: Key Questions Should we ask for this information with each PUDR? (or at least every 6 months) What about Cumulative Reporting? How can we expect PRs to get information that is 3 or 4 years old? The PRs reporting systems are not aligned to the information we are requesting? Does this apply at SR level?
Questions