The World Bank NI Public Financial Management Modernization Project (P111795) REPORT NO.: RES30230 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF NI PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT APPROVED ON DECEMBER 7, 2010 TO REPUBLIC OF NICARAGUA GOVERNANCE LATIN AMERICA AND CARIBBEAN Regional Vice President: Jorge Familiar Calderon Country Director: Yaye Seynabou Sakho Senior Global Practice Director: Deborah L. Wetzel Practice Manager/Manager: Arturo Herrera Gutierrez Task Team Leader: Alberto Leyton, Leonardo Ramiro Lucchetti The World Bank NI Public Financial Management Modernization Project (P111795) I. BASIC DATA Product Information Project ID Financing Instrument P111795 Investment Project Financing Original EA Category Current EA Category Not Required (C) Not Required (C) Approval Date Current Closing Date 07-Dec-2010 31-Dec-2018 Organizations Borrower Responsible Agency Instituto Nacional de Información de Desarrollo Republic of Nicaragua (INIDE),Ministerio de Finanzas y Crédito Público Project Development Objective (PDO) Original PDO The objective of the Project is to enhance the efficiency and transparency of the Recipient’s public expenditure management andstrengthen the Recipient’s statistics management capacity. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-55790 08-Dec-2014 15-Dec-2014 25-Feb-2015 31-Dec-2018 25.00 14.38 10.62 IDA-48070 07-Dec-2010 09-Dec-2010 06-May-2011 31-Dec-2017 10.00 10.01 0 TF-14059 27-Feb-2013 14-Mar-2013 14-Mar-2013 19-Aug-2015 3.35 3.35 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank NI Public Financial Management Modernization Project (P111795) II. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES Project continues to progress moderately satisfactorily. Implementation progress is summarized below: • Regarding the development and implementation of the Administrative and Financial Management Information System (SIGAF by its Spanish initials): the 2018 national budget was formulated in SIGAF and recently approved by the National Assembly. All subsystems except the payroll subsystem have passed testing of quality control, and will be deployed in January 2018 in all Central Administration Institutions. • With regard to the Strengthening of capacities of the accounting profession: as of September 30, 2017, 796 staff have participated in the course for Internal Control, of which 653 staff -82%- have successfully completed the training. Preparation for the design of the Continuing Professional Development Program is also underway. • With respect to the Enhancing of Statistics Management Capacity: the digital cartography is completed, as is the fieldwork for the Census of Buildings. Regarding classification of census segments based on the cartography, segmentation of urban areas has been completed, segmentation of the rest of rural areas (approximately 30 municipalities) will be conducted in 2018. Regarding electronic data collection for Census activities and other statistics operations, the technological platform (SisPro) for data collection and processing continues in development. The Government is evaluating the offers received from the tender of mobile capture devices (tablets) and plan to conduct a pilot census in February or March 2018. A Project restructuring was approved on August 25th, 2017, extending the Additional Financing (AF) closing date to December 31, 2018. Following the extension, the Project Implementation Unit (PIU) has updated their Operations Plan and Disbursement Projections, in which the PIU noted: i) the reduction of costs in components 1, 2, 3 and 5 due to cancelation of contracting several goods and consultant’s services, and reduction of time in several consultants’ services; ii) the increase in costs of component 4 (Project management) due to the extension of project timeframe. On this account, the PIU issued a request to the Bank regarding reallocation of proceeds between categories of expenditure. The borrower proposes to reallocate the proceeds from Category 1 (Goods, Non-Consulting Services, Consultants’ services and Training for Parts 1, 2, 3 and 4 of the Project) and Category 3 (Goods, Non-consulting Services, Consultants’ Services and Training for Part 5 of the Project) to Category 2 (Operating Costs), in order to facilitate activities under Component 4 (Project Management). The reallocation would support the Government to oversee and administer the project, as the costs of consultant’s services in the PIU as well as audits have increased due to the extension of project timeframe. By guaranteeing the continuation of satisfactory project management, the proposed reallocation would ensure that the project remains on track to meet the PDOs. The reallocation across categories represents a 22% increase in the current allocation of Category 2 (Operating Costs), and will reduce the allocation to Category 1 and Category 3 by 1% and 2%, respectively. The funds to be reallocated to Category 2 amount to US$340,000 (bringing the total allocation to US$1,890,392 or approximately 7.6% of the AF). The proposed reallocation does not affect the fulfillment of activities foreseen under categories 1 and 3. III. DETAILED CHANGES The World Bank NI Public Financial Management Modernization Project (P111795) REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Current Current Actuals + Proposed Disbursement % Ln/Cr/TF Expenditure Allocation Committed Allocation (Type Total) Category Current Proposed IDA-55790- GO,NCS,CS,TR- 001 Pt 1,2,3&4(excl. 15,711,250.00 6,140,109.22 15,541,250.00 100.00 100.00 Currency: 2aii) USD Operating Costs 1,550,392.00 1,541,700.99 1,890,392.00 100.00 100.00 GO, NCS, CS, TR 7,738,358.00 5,696,238.75 7,568,358.00 100.00 100.00 - Part 5 Total 25,000,000.00 13,378,048.96 25,000,000.00