The World Bank Maldives: PFM Systems Strengthening Project (P145317) REPORT NO.: RES52215 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF THE MALDIVES: PUBLIC FINANCIAL MANAGEMENT SYSTEMS STRENGTHENING PROJECT APPROVED ON JUNE 26, 2014 TO THE REPUBLIC OF MALDIVES GOVERNANCE GLOBAL PRACTICE SOUTH ASIA REGION Regional Vice President: Martin Raiser Country Director: Faris H. Hadad-Zervos Regional Director: Mathew A. Verghis Practice Manager: Hisham Ahmed Waly Task Team Leader: Winston Percy Onipede Cole The World Bank Maldives: PFM Systems Strengthening Project (P145317) ABBREVIATIONS AND ACRONYMS AF Additional Financing AGO Auditor General’s Office BER Budget Execution Reports DLIs Disbursement Linked Indicators ESG Environmental, Social, and Governance FAD Fiscal Affairs Department FPP Financial Programing Policy IFRS International Financial Reporting Standards IPSAS International Public Sector Accounting Standards ISSAI International Standards of Supreme Audit Institutions MIRA Maldives Inland Revenue Authority MoF Ministry of Finance MDTS Medium-term Debt Strategy MTEF Medium-term Expenditure Framework MTFF Medium-term Fiscal Framework NBS National Bureau of Statistics NPC National Pay Commission NRR Nation Resilience and Recovery NSAP National Strategic Action Plan PAS Public Accounting System PCB Privatization and Corporatization Board PDO Project Development Objective PFA Public Finance Act PFDS Public Finance Development Service PFM Public Financial Management PFR Public Finance Regulation PSIP Public Sector Investment Project SDR/XDR Special Drawing Rights SOE State-Owned Enterprises TPAD Treasury and Public Accounts Department The World Bank Maldives: PFM Systems Strengthening Project (P145317) BASIC DATA Product Information Project ID Financing Instrument P145317 Investment Project Financing Original EA Category Current EA Category Not Required (C) Not Required (C) Approval Date Current Closing Date 26-Jun-2014 31-Jul-2022 Organizations Borrower Responsible Agency Republic of Maldives Project Development Objective (PDO) Original PDO The proposed project development objectives (PDO) are to enhance budget credibility, transparency, and financial reporting of central government finances. Current PDO The PDO (project development objectives) for the proposed AF is to enhance budget credibility, transparency, and financial reporting of public sector finances. The PDO remains relevant and the likelihood of achieving it remains high in view of the project’s implementation progress, disbursement performance, and results achieved to date. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-62200 07-Jun-2018 31-Jul-2018 28-Sep-2018 31-Jul-2022 6.00 5.27 .51 IDA-D2950 07-Jun-2018 31-Jul-2018 28-Sep-2018 31-Jul-2022 6.00 3.32 2.37 IDA-H9510 26-Jun-2014 17-Aug-2014 02-Oct-2014 31-Jul-2022 6.50 6.03 0 The World Bank Maldives: PFM Systems Strengthening Project (P145317) Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Overview 1. This amended Restructuring Paper seeks Country Director’s approval to: (i) cancel US$2.4 million in uncommitted project proceeds (US$1.9 million in Technical Assistance and US$0.5 million in Results-based Financing), (ii) reallocate funds between project components and disbursement categories, and (iii) slightly amend the Results Framework to replace one intermediate result indicator which has proven difficult to achieve, mostly impacted by the slowdown in project implementation due to COVID-19. B. Background 2. The original Credit of US$6.5 million was approved in June 2014. The fiscal challenges during preparation of the project were linked to institutional weaknesses in public financial management (PFM) in addition to a volatile political environment that took significant toll on the whole of budget policy and management. Part of the solution is technical, which the Public Financial Management (PFM) Systems Strengthening Project aims to support. 3. The original Credit was extended by two years, from July 31, 2019, to July 31, 2021, with Additional Financing (AF) in the amount of US$12 million to support the Maldives’ PFM reforms aimed at improving budget credibility and fiscal transparency. The AF covered a financing gap under the parent project and scaled-up the support to the areas of planning and budgeting, debt and cash management, financial reporting, procurement, and State-Owned Enterprises (SOE) monitoring and oversight. The AF extended activities by supporting the roll out of reforms in selected line ministries and adding new beneficiaries, namely the Auditor General’s Office (AGO), the National Pay Commission and the National Bureau of Statistics (NBS). The project components and sub-components are summarized in Table 1. Table 1: Summary of project components/sub-components The World Bank Maldives: PFM Systems Strengthening Project (P145317) Parent Project USD Additional Financing USD Total Component 1: Policy-based fiscal 1,450,000 Component 1: Policy-based fiscal strategy 2,730,000 4,180,000 strategy and budget credibility and budget credibility 1.1. Strengthening the legislative and 440,000 1.4. Enhancing medium-term fiscal framework 1,370,000 institutional framework for PFM and evidenced based budgeting (HIES) 1.2. Enhancing the Medium-Term Fiscal 600,000 1.5. Strengthening Debt and Cash Management 950,000 Framework 1.3. Strengthening Debt and Cash 410,000 1.6. Strengthening Management of the Capital 410,000 Management Budget Component 2: Controlled Budget 4,400,000 Component 2: Controlled Budget Execution 6,085,000 10,485,000 Execution 2.1. Strengthening the PAS 3,550,000 2.3. Strengthening PAS and Asset Management 2,100,000 2.2. Enhancing the Control Environment 850,000 2.4. Payroll Management and Control 1,655,000 2.5. SOE Governance and oversight 1,880,000 2.6. Procurement Reform 450,000 Component 3: Project Management 550,000 550,000 Component 4: Accounting, Reporting and 1,700,000 1,700,000 Internal Audit Component 5: External Scrutiny and Audit 415,000 415,000 Component 6: Project and Change 1,070,000 1,070,000 Management Contingency 100,000 100,000 Total 6,500,000 Total 12,000,000 18,500,000 C. Status 4. The likelihood of achieving the PDOs is ’satisfactory’, with three out of the four PDO indicators met (deviation between aggregate expenditure out-turn and the original approved budget; public access to key fiscal information; and comprehensiveness of debt data recording and reporting), and one partially met (70 percent disclosure against a target of 100 percent for SOE financial reporting) . 5. Implementation progress has improved from ‘moderately satisfactory’ to ‘satisfactory’. The project has now met 91 percent of Disbursement Linked Indicators (DLIs) value, up from 48 percent in 2021 (i.e., 11 out of 12 DLI targets). The total disbursement for the parent project and additional financing as of July 21, 2022 is US$14.51 million (equivalent to 82.88 percent of the total project value). The overall undisbursed balance stands at US$3 million. The project overall budget utilization has increased from 74 percent in March 2022 to 82 percent in June 2022, and forecasted to close at 86 percent. 6. Below are key selected deliverables to date for the parent project and AF components: Component 1: Policy-based Fiscal Strategy and Budget Credibility  A high-level committee comprising of members from relevant departments reviewed the Public Finance Regulation (PFR). The committee revised the full PFR and submitted to the Attorney General’s Office - (a) Budget Appropriation and Virement Rules was published in May 2019, (b) Public Finance Act (PFA) 6th amendment published and draft PFR sent to Attorney General’s Office, (c) 7th amendment to PFA submitted to the Peoples Majilis and the necessary guidelines are being developed by the legal and the relevant departments, (d) Committee comprising Legal Department and Public Enterprises Monitoring Department at the Ministry of Finance (MoF) reviewed the Privatization and Corporatization Board (PCB) Act which is currently on Parliaments’ legislative agenda for consideration. The World Bank Maldives: PFM Systems Strengthening Project (P145317)  Financial Programing and Policy (FPP) model developed, staff trained on using the model and FPP used for fiscal strategy formulation. Methodological manual is now in place for preparing and reviewing the medium-term fiscal framework (MTFF).  MoF institutional framework changed. A screening guideline for public investments and new initiative were developed and used for the National Strategic Action Plan (NSAP) and Nation Resilience and Recovery (NRR) Plan.  Rolling medium-term debt strategy (MTDS) is now submitted to Parliament within the prescribed time under the Fiscal Responsibilities Act. The MTDS is included in published Fiscal and Debt Strategy Reports.  A Cash Management Committee was formed in 2017 with representatives from Maldives Inland Revenue Authority (MIRA) and Maldives Monetary Authority (MMA). MoF is regularly updating the cash flow forecasts. Debt Sustainability Analysis (DSA) was developed in collaboration with the Fiscal Affairs Department (FAD).  Developed and rolled out medium-term expenditure framework (MTEF). MTEF model was used to update the fiscal strategy for 2018-2020 onwards.  A Fiscal Risk Statement was published in May 2021. As part of the tax expenditure analysis undertaken by FAD, MoF published exemption on import duties in the 2021 Budget Report. The United States Agency for International Development (USAID)-funded project is also supporting modelling and tax incidence analysis.  Household Income and Expenditure Survey (HIES) 2019 is available on website in its complete form, along with infographics for specific sections. The FAD of the MoF has been using HIES 2019 dataset in various policy analysis.  Upgraded the debt recording and management system in a unified debt database. Commonwealth Secretariat Debt Recording and Management System (CS-DRMS) data has been migrated and validated in Meridian which is now ‘live’.  All new projects and programs submitted by budgetary units are reviewed using a screening guideline for public investments and prioritized by using internal standard criteria set by FAD. New policy initiatives are budgeted based on the NSAP and NRR Plan. Component 2: Controlled Budget Execution  Personnel data compiled from Civil Service system (“Viuga”) and SAP system, and now regularly updated by line ministries via the “Bandeyri” Portal. This will assist in the long term in decision-making regarding pay increases and budget planning.  SAP training for staff – 14 Civil servants have completed SAP certification in the following modules: Business Planning and Consolidation (BPC)-five, Human Capital Management (HCM)-one, Advanced Business Application Programming (ABAP)-one, Materials Management (MM)-one, Business Objects Business Intelligence (BOBJ)-two, Financial Accounting (FI)-two, BASIS (the technical foundation that enables SAP applications to function)-two.  SAP Business Intelligence (BI) budget execution reports (BERs) are available by line agencies and central MoF users. The BER now includes a column for payments at commitment stage. As part of the plans to improve the chart of accounts, FAD is planning to improve the comprehensiveness of published budget reports in ‘open data’ format. BER for second quarter of 2021 was subjected to internal audit.  A public procurement policy unit has been established in MoF. Bid committees are formed through https://bandeyri.egov.mv and minutes of meetings and procurements awarded by the bid committees are available through Bandeyri portal.  Developed harmonized procurement guidelines, national standard procurement documents, contractual documents, and user guides. A phased strategy is being considered in which the generic documents would be disseminated first, followed by the specific Standard Bidding Documents (SBDs).  PCB analyzes the financial status of SOE and public companies controlled by the Government. Audit of SOEs is now done by private audit firms based on terms of reference approved and assignment supervised by AGO. The audit opinion is signed-off by AGO and reports based on audit outputs are submitted to parliament. PCB uses the The World Bank Maldives: PFM Systems Strengthening Project (P145317) published audited financial statements to conduct annual financial performance reviews and make recommendations. The SOE Gateway https://soegateway.finance.gov.mv/soes provides a one-stop-shop to improve transparency of SOEs. Corporate Governance Review 2021 of SOEs published.  Public Accounting System (PAS) is now used by all ministries. With the Asset Management Policy - Ministry of Finance now issued, Asset Register is now maintained in SAP. This disclosure of the Asset Registry for the fiscal year-ended 2021 financial statements will allow the project to meet the disclosure target for the financial statements to have notes on Asset Register.  The Public Finance Development Service (PFDS) was established to carry out development activities to strengthen the services provided by the Ministry to key beneficiaries. By establishing “Scheme of PFDS Unit, the Ministry is expecting to attract and retain critical staff with marketable skills to mitigate the very high turnover of critical staff, which is one of the objectives in establishing the PFDS Unit1.  In 2019, the National Pay Commission (NPC), issued the “Maldives Public Service Job Family Model” that provides a standardized system of classifying occupations and professions across the public service organizations of the Maldives. The Civil Service Commission (CSC) and the NPC has established a civil service registry with gender disaggregated data. The provision of this quality data enabled the development of wage policy.  The electronic government procurement (e-GP) readiness assessment concluded that Maldives has overall favorable alignment of essential factors, both in the public and private sectors, for implementing e-procurement initiatives by building on recent experiences to move the process forward.  The Maldives National University (MNU) developed a new procurement curriculum with a two-week training program for 450 government employees. As of June 2022, 286 participants of which 53 percent are male and 47 percent are female were registered from various agencies. The Procurement Level 1 Certificate that will be issued after the two-weeks course will be a pre-requisite for a planned Advance Certificate. Component 3: Project Management  An international management implementation support consultant and later a local consultant to support project coordination, monitoring and evaluation (M&E) activities.  Relevant training required to strengthen the skills of the project coordinating staff and other incremental operating costs relating to project coordination. Component 4. Accounting, Reporting and Internal Audit  The AGO review of the State Internal Audit Function (SIAF) in 2021 concluded that SIAF conforms partially with the Institute of Internal Auditors (IIA) International Professional Practices Framework (IPPF).  Even though a readiness assessment was not done, based on the strategic action plan that was prepared, internal audit function has been rolled-out to few large ministries/agencies that handle budget of over MVR1 billion which accounts for about 80 percent of the budget.  The Treasury and Public Accounts Department (TPAD) has prepared a credible plan for first-time adoption of accrual-basis International Public Sector Accounting Standard (IPSAS). With year ending 2023 as the transition year and assertion of compliance in fiscal year ending 2025.  Steps are being taken towards professionalization of the PFM cadre starting with recruitment of a professionally qualified Chief Public Accountant reporting to the Financial Controller’s Office (FCO). Chief Accounts Executives 1 16 PFDS positions: 5 SAP functional experts under the authority of the Finance Controller and 4 IT technical experts, under the authority of a Chief Information Officer (CIO). Other experts will support SOE governance, ICT, internal audit, economic and fiscal, debt and asset management. The World Bank Maldives: PFM Systems Strengthening Project (P145317) are subjected to technical examination requiring pass mark of seventy percent before posting to line departments for which posting has been done to the ministries of planning, housing, health, and education. Component 5. External Audit of the Public Sector  International Standards of Supreme Audit Institutions (ISSAI)-compliant Financial Audit Manual (FAG) produced that sets guidelines for policy and procedures and a Financial Audit Guide that provides guidelines to auditors undertaking financial audits.  AGO through a working group benchmarked its current audit methodologies against the INTOSAI ISSAI Compliance Assessment Tool (iCAT) for Financial Audit. Areas identified for enhancement was used to update the FAG which is applied to those accounts that are prepared under the IPSAS (cash-basis) accounting principles which are mainly applied by central departmental bodies.  International Financial Reporting Standards (IFRS) compliant financial statement audit guide for SMEs within SOEs and IFRS-compliant Financial Statement Audit Guide was produced and used in two pilot audits as part of the training process.  On and off-field technical assistance provided to conduct two IT audits of the SAP-based Tax and Revenue Management (TRM) used in Maldives Inland Revenue Authority (MIRA) and the SAP-based PAS.  AGO is publishing audit reports of SOEs on AGO website with some on the SOEs own website.  Capacity building of the Public Accounts Committee (PAC) members of parliament attended United Kingdom Parliament sessions during a study tour while AGO and MoF staff attended National Audit Office, Chartered Institute of Public Finance and Accountancy (CIPFA) and Financial Reporting Council meetings. Component 6. Project and Change Management  Several adverts to secure the services of an institutional development firm to develop strategy for competency framework for critical PFM functions and support development and implementation of change management and communication strategy were unsuccessful.  Cross-cutting training and capacity building provided to the following project stakeholders: all the MoF departments, such as National Tender (NT), Debt Management Department (DMD), TPAD, Internal Audit Department (IAD), Resource Mobilization Department (RMD), PCB, and Corporate Affairs Department. D. Rationale 7. The COVID-19 pandemic that led to several rounds of countrywide shutdowns contributed to implementation challenges. It was difficult to hire consultants to provide the much-needed in-country technical assistance which caused significant disbursement lag. A detailed implementation plan with monthly milestones to meet the remaining DLIs and utilize the technical assistance component was prepared and closely monitored together with the key procurement activities which were at various stages of procurement/implementation. Implementation picked up after filling the position of project director which was vacant for 12 months. 8. Based on the forecasted unutilized balance of US$2.4 million (Table 2), on July 17, 2022, MoF submitted a request to cancel US$2.4 million. The cancelled amount is available for recommitment within IDA20. The World Bank Maldives: PFM Systems Strengthening Project (P145317) Table 2: Projected budget absorption up to July 2022 Forecast Jun Mar Nov Cumulative Balance Jul ‘22 ‘22 ‘21 Adjusted Projected (US$) ‘22 % % % Details Budget Actual % (US$) (US$) 91 1. Disbursement Linked Indicator (DLI) (IDA- 5,781,666 5,266,057 515,609 91 86 47 62200) - US$218,334 adjusted for FX difference. 66 40 29 2. Technical Assistance (TA) (IDA-D2950) 54 5,731,206 3,755,814 1,975,391 - US$268,794 adjusted for FX difference. 100 93 92 3. Parent Project (IDA-H9510) 100 (SDR 4,300,000.00, received in US$6,030,066.25) 6,030,066 6,030,066 0 - Adjustment of $469,934 for FX difference Totals 17,542,938 15,051,937 2,491,000 86 82 74 57 Foreign Exchange Difference 957,062 18,500,000 9. The project is out of time to meet DLI2 which requires 100 percent of new MoF cadre to be recruited according to the revised pay structure for finance cadre. This is because the Government has decided on a gradual approach to implement the new harmonized pay structure by starting with the health sector. Also, DLI2, which is valued at Special Drawing Rights (SDR/XDR) 350,000, is not scalable. This means that, to fulfil the disbursement condition, the 16 PFDS will have to be fully recruited on the new harmonized pay structure. In addition, there is remaining balance on DLI1 (SDR 36,667) for the two vacant PFDS positions. 10. With regards to the technical assistance component, the project has not been successful to hire suitable consultants for some activities. The portion of activities “under implementation” that will go beyond the project closing date will be paid directly by the Government. II. DESCRIPTION OF PROPOSED CHANGES A. Proposed changes 11. It is proposed that SDR 1,400,000 from IDA-D2950 and SDR 350,000 from IDA-6220) be cancelled - Table 3. The AF is disbursed through two modalities: input-based financing (US$6 million, IDA-D2950) and results-based financing (US$6 million, IDA-D2950) against the achievement of targets for DLIs. The World Bank Maldives: PFM Systems Strengthening Project (P145317) Table 3: Forecast of budget absorption up to July 2022 12. The cancellation of related technical assistance will directly affect attainment of the following, which will be dropped from the Financing Agreement and Results Framework:  Sub-component 1.5: strengthening debt and cash management - provision of technical assistance to improve cash flow projections to meet the expenditure requests on a timely basis, smoothen the cash flow fluctuations and contribute to the preparation of domestic borrowing plans.  Sub-component 2.6: procurement reforms - provision of technical assistance for the pilot testing of green procurement.  Intermediate result indicator: Inclusion of CPA techniques in Performance Audit is proposed to be replaced by “International Financial Reporting Standards (IFRS) compliant Audit Guide”. This will complement the reforms for SOEs by using the IFRS-compliant audit guide in at least one pilot audit of SOE. 13. It is proposed to drop the DLI2 related Disbursement Linked Result (DLR) valued at SDR 350,000 to be achieved in Year 4 (by June 30, 2021), for “100% of new MoF cadre recruited are subject to the revised pay structure for finance cadres”. There is insufficient time left to follow the laid down civil service recruitment procedures, which takes time. The World Bank Maldives: PFM Systems Strengthening Project (P145317) III. SUMMARY OF CHANGES Changed Not Changed Results Framework ✔ Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursement Estimates ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ PBCs ✔ Loan Closing Date(s) ✔ Disbursements Arrangements ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ The World Bank Maldives: PFM Systems Strengthening Project (P145317) IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_COMPONENTS_TABLE COMPONENTS Current Current Proposed Proposed Cost Action Component Name Component Name Cost (US$M) (US$M) Policy-based fiscal strategy and Policy-based fiscal strategy and 2.73 Revised 3.53 budget credibility budget credibility Controlled budget execution 6.08 Revised Controlled budget execution 9.59 Accounting, reporting and Accounting, reporting and 1.70 Revised 1.40 internal audit internal audit External scrutiny and audit 0.42 Revised External scrutiny and audit 0.16 Project and Change Project and Change Management 1.07 Revised 1.42 Management TOTAL 12.00 16.10 OPS_DETAILEDCHANGES_CANCELLATIONS_TABLE CANCELLATIONS Value Reason Current Cancellation New Ln/Cr/Tf Status Currency Date of for Amount Amount Amount Cancellation Cancellation UNDISBURSE IDA-62200- Disburs XDR 4,200,000.00 350,000.00 28-Jul-2022 3,850,000.00 D BALANCE 001 ing AT CLOSING UNDISBURSE IDA-D2950- Disburs XDR 4,200,000.00 1,400,000.00 28-Jul-2022 2,800,000.00 D BALANCE 001 ing AT CLOSING IDA-H9510- Disburs XDR 4,300,000.00 0.00 28-Jul-2022 4,300,000.00 001 ing OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed IDA-62200-001 | Currency: XDR The World Bank Maldives: PFM Systems Strengthening Project (P145317) iLap Category Sequence No: 2 Current Expenditure Category: EEP under Pt 2 and 3 of proj 4,200,000.00 3,813,333.00 3,850,000.00 100.00 100.00 Total 4,200,000.00 3,813,333.00 3,850,000.00 IDA-D2950-001 | Currency: XDR iLap Category Sequence No: 1 Current Expenditure Category: Gds,Wks,NCS,CS,Trng,IOC 4,200,000.00 1,977,043.28 2,800,000.00 100.00 100.00 Total 4,200,000.00 1,977,043.28 2,800,000.00 OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE DISBURSEMENT ESTIMATES Change in Disbursement Estimates Yes Year Current Proposed 2014 0.00 0.00 2015 263,760.00 263,760.00 2016 570,192.00 570,192.00 2017 674,592.00 674,592.00 2018 918,552.00 918,552.00 2019 2,500,000.00 2,500,000.00 2020 3,300,000.00 3,300,000.00 2021 3,400,000.00 3,400,000.00 2022 933,333.32 4,472,904.00 . The World Bank Maldives: PFM Systems Strengthening Project (P145317) . Results framework COUNTRY: Maldives Maldives: PFM Systems Strengthening Project Project Development Objectives(s) The PDO (project development objectives) for the proposed AF is to enhance budget credibility, transparency, and financial reporting of public sector finances. The PDO remains relevant and the likelihood of achieving it remains high in view of the project’s implementation progress, disbursement performance, and results achieved to date. Project Development Objective Indicators by Objectives/ Outcomes RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 To enhance budget credibility, transparency, and financial reporting of public sector finances Deviation between aggregate expenditure out turn and the original 18.74 10.00 9.00 8.00 7.00 5.00 approved budget (Percentage) Public disclosure of Public disclosure of Documents not made Public disclosure of Public disclosure of Public disclosure of (1) Annual budget (1) Annual budget Public disclosure of the available to the (1) Annual budget (1) Annual budget(1) Complete set of documents made documents available following key fiscal public: documents available documents available annual budget available in parallel to to public in parallel to information: (a) Annual (1) Year-end state in parallel to these in parallel to these documents when these being these being budget financial statements being submitted to being submitted to they are submitted to Public Access to Key Fiscal submitted to submitted to documentation, (b) In- of the Republic of legislature. legislature. legislature. Information (Text) legislature. legislature. year budget execution Maldives; (2) In-year reports, (c) Year-end budget execution (2) Resources (2) Resources (2) Monthly in-year financial statements, (2) Resources (2) Resources reports; available to primary available to primary budget execution available to primary available to primary (d) tenders above USD (3) Contracts service units service units reports within one 100 000. service units service units awarded. annually. annually. month of completion. annually. annually. The World Bank Maldives: PFM Systems Strengthening Project (P145317) RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 Budget documents (3) Quarterly (3) Monthly in-year (3) Info concerning and resources in-year budget budget execution resources available to available to primary execution reports reports published primary service units service units are published within one within one month of at least annually or available in public month of completion, completion. available on request domain. for primary service units with national (4) Year-end financial (4) Year-end financial statements of the coverage in at least 2 statements of the sectors. Republic of Maldives Republic of Maldives published within 6 published within 6 months of completed months of completed (4)Year-end financial audit. audit. statements of the Republic of Maldives (5) Contracts published within 6 (5) Contracts awarded months of completed awarded audit. above US$100,000 above US$100,000 published quarterly. published quarterly. (5) Contracts awarded above US$100,000 published at least quarterly. Annual statement of Domestic and foreign Domestic and foreign Domestic and foreign Domestic and foreign Domestic and foreign Domestic and foreign debt covering debt records are debt records are debt records are debt records are debt records are debt records are Comprehensiveness of debt domestic and complete, except for complete, except for complete, except for complete, including complete, including complete, includes data recording and external debt is payables to suppliers, payables to suppliers, payables to suppliers, payables to suppliers, payables to suppliers, payable amount reporting (Text) prepared, but there updated and updated and updated and updated and updated and updated and are gaps and reconciled every 6 reconciled every 6 reconciled every 6 reconciled quarterly. reconciled quarterly. reconciled quarterly. The World Bank Maldives: PFM Systems Strengthening Project (P145317) RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 reconciliation months. months. months. Comprehensive Comprehensive Comprehensive problems. management and management and management and statistical reports statistical reports statistical reports (covering debt (covering debt (covering debt service, service, stock and service, stock and stock and operations) operations) are operations) are are produced at least produced at least produced at least annually. SOE financial reporting and 50.00 100.00 disclosure (Percentage) PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 Policy-based fiscal strategy and budget credibility 100% of staff trained on 100% of staff trained on debt and cash debt and cash 100% of staff at Debt 100% of staff at Debt management management Management Dept Management Dept Credible DMS does not Debt management trained on the job to trained on the job to exist. strategy produced update the DMS. update the DMS. Increased capacity on debt and cash management (Text) CFF model developed CFF model developed Credible DMS exists and and 100% of relevant and 100% of relevant imple-mented. Credible DMS exists and staff trainedon CFF staff trainedon CFF implemented. model. model. CFF plan exists: prepared The World Bank Maldives: PFM Systems Strengthening Project (P145317) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 for fiscal year and updated quarterly based CFF plan exists: prepare on CFF model. for the fiscal year and updated quarterly based on CFF model. Credible macro fiscal framework exists and Credible macro fiscal used for budget framework exists and preparation. used for budget preparation. Final macro fiscal forecasting tool exists Final macro fiscal and used. Credible macro fiscal Methodology for forecasting tool exists framework exists and is 0% of staff trained on preparation of macro and used. Final framework exists based on macro fiscal macro fiscal planning. fiscal framework exists. Production of a Macro and used for assessing forecasting tool to fiscal forecasting tool to Increased capacity on macro Draft framework exists economic viability and assess economic viability No credible MTFF and Draft macro fiscal inform the annual budget fiscal planning (Text) for assessing economic prioritization of public and prioritization of framework for assessing forecasting tool exists. public investment viability and investment projects investment projects projects prioritization of public exists. 100% of EPP unit staff investment projects. 100% of staff at EPP trained on methodology trained to: 100% of staff at EPP (1) Conduct fiscal policy unittrained on the job to analysis to assess impact prepare the macro fiscal of tax and expenditure framework using the measures on poverty model. and macro aggregates: (2) Use the framework for capital project The World Bank Maldives: PFM Systems Strengthening Project (P145317) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 selection. Controlled budget execution Procurement policy section established and Capacity building on functional. 50% of contract awards 75% of contract awards 90% of contract awards procurement through the NIL meet required M&E meet required M&E meet required M&E 15.00 implementation of a new Procurement curricula (Text) Monitoring mechanism standards. standards. standards. established under each procuring entity. BERs subjected to audit by 0.00 10.00 25.00 50.00 75.00 100.00 internal auditors (Percentage) Updated gender disaggregated No recent data on Findings from HHIES have statistics to inform fiscal policy household been published (Text) income/expenditures End year Financial Improved asset management Asset registry not Statements with asset (Text) annexed to AFS registry External scrutiny and audit (Action: This Component has been Marked for Deletion) Two pilot Performance Inclusion of CPA techniques in No use of CPA Audits conducted using Performance Audit (Text) CPA Action: This indicator has been Marked for Deletion Project and Change Management Improved communication of No PFM communication Communication strategy Communication strategy Communication strategy Communication strategy Communication strategy PFM reforms (Text) strategy approved. exists. exists exists exists The World Bank Maldives: PFM Systems Strengthening Project (P145317) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 Five awareness and Ten consultation All planned consultation All planned consultation All planned consultation consultation workshops workshops on business workshops held for legal workshops held for legal workshops held for legal on business process process improvement and business process and business process and business process improvement held. held in total by end of review review review FY2. Five awareness and Five change Ten change Fifteen change consultation workshops Ten consultation management workshops managementworkshops management workshops on the legislative review workshops on the for key stakeholders for key stakeholders for key stakeholders held held. legislative review held in held in total by end of held in total by end of in total by end of FY5. total by end of FY2 FY3. FY4. stakeholders held in total by end of FY5. Accounting, reporting and internal audit Comprehensive AFS prepared and submitted Comprehensive AFS with to audit within 6 months 100% of relevant staff information on from year end.* trained in accounting expenditures, revenue, (*Per PEFA fieldguide, standards and financial assets and the actual date of preparation of AFS and liabilities prepared and submission is the date System-generated AFS Timely preparation of annual AFS not accepted by SAP training on submitted to audit System-generated AFS on which the external submitted to audit financial statements (AFS) audit as complete and generating reports. within 6 months from submitted to audit within auditor considers the within 5 months from (Text) ready for audit. year end. 4 months from year end. financial statements year end. Work initiated on complete and available software enhancement/ Necessary software for audit.). functional upgrades enhancements and required. functional upgrades Functional upgrades and carried out. necessary integration with other systems to The World Bank Maldives: PFM Systems Strengthening Project (P145317) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 generate AFS via the system- completed. External scrutiny and audit (Action: This Component is New) International Financial Reporting Standards (IFRS) No Yes compliant Audit Guide (Yes/No) Rationale: This will complement the reforms for SOEs by using the IFRS-compliant audit guide in at least one pilot audit of SOE. There are 15 Ministries, 19 Statutory Bodies and 195 Local Councils in the Maldives for which the Auditor General expresses an audit opinion on their financial statements. In addition, the AGO is Action: This indicator is New response for the audit of State-Owned Enterprises (SoEs), however audit of the large SoEs are sub-contracted to private sector firms. The AGO issues about 250 audit opinions and reports each year. IO Table SPACE The World Bank Maldives: PFM Systems Strengthening Project (P145317)