Objective 3.1

Effective, timely, transparent and accurate financial, budgetary and resource management and reporting

By the end of 2013, OCHA aims to have created a financial-management culture based on increased accountability and stronger decision-making capabilities for programme managers. Access to integrated data systems should inform OCHA’s financial, budgetary, resource mobilization and reporting transactions. The systems need to be rigorous, effective and fully documented, with aligned budgeting and income forecasting.

The management of OCHA’s country-based pooled funds must be meticulous, meeting external stakeholders’ requirements. To that end, ERF global guidelines have been disseminated to provide country offices with the appropriate tools to support Humanitarian Coordinators in coherently managing ERFs. The guidelines provide clearer instructions related to financial reporting and external auditing for projects funded through the ERFs. OCHA will roll out the implementation of an ERF monitoring and reporting framework and develop a grant management system to streamline the operation of country-based pooled funds. This system will facilitate the work of country offices, while also enabling the centralization of data for programmatic and financial analysis and reporting. Altogether, these measures will ensure OCHA has improved capacity to manage and operate country-based pooled funds, and that proper control mechanisms are in place.

There has been steady and consistent progress towards more predictable and flexible funding, and on donor reporting. Reporting on income and expenditure has increasingly been automated, enabling programme managers to monitor their finances, plan resource mobilization and allow effective budgeting. Senior management has also adopted an Internal Control Framework that sets out the separation of responsibilities and internal controls in place to ensure proper stewardship and accountability for the organization’s resources.

In 2013, key initiatives on financial, budgetary and resource management issues include:

a) Further development of effective ERF/CHF internal monitoring and control mechanisms.

b) Well-organized budgeting procedures linked to income forecasts and work planning.

c) Preparedness for International Public Sector Accounting Standards (IPSAS) implementation.

d) Roll-out of the Programme and Financial Information Management system (ProFi).

e) Outlining guidelines to enable donors to evaluate project implementation based on public-sector accounting standards in line with reporting provided by other UN agencies.

f) Working with the Controller’s Office to explore ways to better manage OCHA’s trust funds.

 

Key initiatives on income include making resource management and reporting more effective and transparent by:

a) Raising funds as early as possible in the budget cycle.

b) Increasing unearmarked funding commitments.

c) Making payments more predictable.

d) Focusing on accountability and results.

The overall aim is to ensure that timely and flexible funding is available to cover OCHA’s budgeted requirements, and to ensure that the results of OCHA’s work at the field level are communicated to donors and other interested Member States.

Result 1: Prudent budget and liquidity management supported by rigorous data systems
Indicator 1. Standard guidelines on cost planning and closer link with work-planning
BASELINE 2011

Income forecast and cost-planning are prepared separately; workplans and cost plans are independent activities.

TARGET 2012

Link cost planning exercise to donor funding projections and work-planning;

TARGET 2013

a) Issue guidelines/SOPs on cost planning, including mapping of cost planning and budget-amendment procedures.

b) Develop and roll out PSC strategy.

Indicator 2. Effective liquidity management
BASELINE 2011

Consolidation of cash reserves, introduction of new procedures for emergency cash reserves, challenges in cash flow forecasting and poor oversight of expenditure.

TARGET 2012

Development of SOP on cash management, monthly monitoring of cash reserves, realistic cash requirements, Office of Programme Planning, Budget and Accounts (OPPBA) agreement on movement of funds between the Trust Fund for Disaster Relief Assistance (DMA) and the Trust Fund for Strengthening of OCHA (DDA)..

TARGET 2013

A) Adoption and implementation of SOP on cash management.

B) Work with Controller’s Office to explore merger of OCHA’s trust funds.

Indicator 3. Increased predictable income supporting more effective cash management
BASELINE 2011

Seven multi-year funding agreements

TARGET 2012

+1

TARGET 2013

+2

Indicator 4. Integrated budget, expenditure and income planning and data management systems
BASELINE 2011

Multiple HQ systems and modules, locally developed software packages, proliferation of stand-alone databases; automated information-sharing between HQs and field not possible. Manually integrated income and expenditure reports piloted (September 2011); ad hoc financial forecasting (income and expenditure) informs budget process.

TARGET 2012

Selection of single integrated and comprehensive data-management platform, serving as the primary common database for budgetary and financial information, accessible simultaneously by Headquarters and field staff. Semi-automated income-and-expenditure reporting products piloted; integrated financial-planning system informs budget process and cost-plan amendments.

TARGET 2013

A) Roll-out of new data management platform (ProFi) across OCHA.

B) Improve accuracy and completeness of disclosure of NEP and write-off of NEP in the financial statements, and improve the oversight of field offices’ NEP management.

C) Preparedness for implementation of UN Secretariat ERP system (Umoja).

D) Automation of wide range of income-and-expenditure reporting and analysis products, assisting more-effective budget management.

E) Standard procedures agreed for budget oversight and links between income, expenditure and budget-performance monitoring.

Indicator 5. Readiness for International Public Sector Accounting Standards (IPSAS) implementation in 2014
BASELINE 2011

IPSAS implementation scheduled and UN processes being reviewed for compliance.

TARGET 2012

Training and preparatory work to ensure compliance with IPSAS – 12 (Inventory management) and IPSAS-17 (Property, plant and equipment) to be undertaken.

TARGET 2013

Data gathering and clean-up of existing information to be completed for automation and readiness for IPSAS implementation in 2014

Result 2: Financial management of field-level pooled funds (CHF Somalia and ERFs) meets programmatic and donor requirements
Indicator 1. Timeliness of ERF disbursements to be systematically monitored and improved
BASELINE 2011

Speed of disbursements targeted within 10 working days but often takes longer. There is no systematic monitoring tool to measure and make an evidence-based analysis on the speed of the disbursements.

TARGET 2012

Disbursement processes will be systematically monitored through an Excel-based tracking database developed jointly by ASB and FCS by Q4.

TARGET 2013

A) Speed of first disbursements maintained at a maximum of 10 working days. 

B) Speed of final payments from receipt of final narrative and financial reports (including commissioning of audit by fund managers, review of final audited reports by fund managers and ASB, and issuance of final disbursement) targeted at three calendar months.

C) Development of grant-management system (Arigatool) to systematically monitor disbursement processes.

Indicator 2. Standardised policies and procedures established and monitored
BASELINE 2011

Draft global ERF guideline (along with detailed SOP and administrative guidelines) to be finalized by Q4 2011.

TARGET 2012

A) ERF Guidelines and SOP adopted and at least 80 per cent compliance achieved.

B) CHF Guidelines review and revision initiated.

TARGET 2013

A) Compliance with the ERF Guidelines measured in 2013. Targeting 100 per cent compliance by monitoring through surveys, missions and teleconferences. Indicators for compliance developed to support this exercise. 100 per cent of ToRs of each fund will be revised to align with the guidelines where possible.

B) A review of ERF guidelines conducted by Q2 based on results of the Global ERF Evaluation.

C) CHF Guidelines approved by SMT by Q3.

D) Develop a resource mobilization strategy framework for pooled funds in line with OCHA’s overall fundraising strategy by Q1.

Indicator 3. Level of reporting compliance by implementing organisations improved
BASELINE 2011

Delayed receipt of interim and final reports from implementing partners, resulting in delayed disbursements of final payments. OCHA has no direct control over timely submission of financial reports.

TARGET 2012

A)  Ensure a proactive follow-up of reporting submissions through an Excel-based tracking database developed jointly by ASB and FCS by Q4.

B) 60 per cent of all pooled-fund reports received within the agreed reporting periods. 

C) Develop a global ERF monitoring-and-reporting framework in the form of a guidance note to be annexed to the ERF guidelines by the end of 2012.

TARGET 2013

A) Ensure proactive follow up of reporting submissions through development of grant-management system (Arigatool).

B) Apply systematic follow-up mechanism on reporting compliance including developing measures of enforcement (e.g. possible temporary suspension of eligibility to the fund).

C) 80 per cent of all pooled fund reports received within the agreed reporting periods. 

D) Audit service to be procured in the form of Long Term Agreements (LTAs) in all country offices via UNDP by Q2.

E) Roll out a global ERF monitoring-and-reporting framework, including increasing the number of field-monitoring visits, particularly to those projects bearing potentially greater risks.

F) Develop and roll out a pooled funds risk-assessment and risk-management tool.