FIDUCIARY SYSTEMS ASSESSMENT ETHIOPIA CLIMATE ACTION AND LANDSCAPE MANAGEMENT PROGRAM FOR RESULTS 30 APRIL 2019 1 Table of Contents 1. Conclusions ..............................................................................................................................................5 1.1. Reasonable Assurance .............................................................................................................................5 1.2. Risk assessment........................................................................................................................................5 1.3. Procurement exclusions ...........................................................................................................................6 2. Scope ........................................................................................................................................................7 3. Review of Public Financial Management cycle .....................................................................................11 3.1.0. Planning and budgeting .........................................................................................................................13 3.1.1. Adequacy of budgets..............................................................................................................................13 3.1.2. Procurement planning ...........................................................................................................................14 3.2. Budget execution ......................................................................................................................................16 3.2.1 Treasury management and funds flow ....................................................................................................16 3.2.2 Accounting and financial reporting ..........................................................................................................17 3.2.3 procurement process and procedures .....................................................................................................18 3.2.4 contract administration ...........................................................................................................................21 3.3. Internal controls ........................................................................................................................................22 3.3.1 Internal controls .......................................................................................................................................22 3.3.2 Internal audit ...........................................................................................................................................23 3.3.3 Governance and anti-corruption .............................................................................................................23 3.4 Auditing ......................................................................................................................................................25 3.5 Staff Capacity ..............................................................................................................................................27 3.5.1. Staffing ....................................................................................................................................................27 3.5.2. Capacity building .....................................................................................................................................27 4. Program systems and capacity Improvements .....................................................................................28 5. Implementation support .......................................................................................................................36 ANNEXES ............................................................................................................................................................. 37 Annex 1: PEFA rating for Ethiopia (2014) ..........................................................................................................37 Annex 2: Continuous audit report findings data for three quarters of EFY 2010 .............................................45 Annex 3: Budget/Spending numbers/trend ......................................................................................................46 Annex 4: Financial management Staff data ......................................................................................................60 Annex 5: External Audit-visited implementing entities ....................................................................................64 Annex 6: Fraud and Corruption and Compliant handling Performance ...........................................................67 Annex 7: Budget Line item for the reporting of expenditure under the General-purpose grant ....................73 Annex 8: Applicable Procurement KPIs in Ethiopia public procurement system ..............................................75 Annex 9: Persons met and discussed ...............................................................................................................76 Annex 10: Visited implementing entities ..........................................................................................................81 2 ACRONYMS AND ABBREVIATIONS ACG Anti-Corruption Guideline AGP Agricultural Growth Program ATVET Agricultural Technical and Vocational Education and Training BLAU Bureau of Land Administration and Use BRLAU Bureau of Rural Land Management and Use BoA Bureau of Agriculture BoF Bureau of Finance CALM Climate Action and Landscape Management COPCD Channel One Program Coordination Directorate CPAR Country Procurement system Assessment Report CSRP Civil Service Reform Program CWT Community Watershed Team DA Development Agent DC Direct contract DLI Disbursement linked indicator EAC Ethics and Anti-corruption EFY Ethiopian Fiscal Year ESIF Ethiopian Sustainable Investment Framework ESPES Enhancing Shared Prosperity Through Equitable Services FAG Federal Attorney General FDRE Federal Democratic Republic of Ethiopia FSA Fiduciary System Assessment F/REACC Federal/Regional Ethics and Anti-Corruption Commission FY Fiscal Year GOE Government of Ethiopia GRM Grievance Redress Mechanism IBEX Integrated Budget and Expenditure IDA International Development Association IFMIS Integrated Financial Management Information System INTROSAI International Organization of Supreme Audit Institutions IA Implementing Agency ICB International Competitive Bidding INT Integrity Vice Presidency KPI Key Performance Indicators 3 LAUD Land Administration and Use Directorate LCB Local Competitive Bidding MAPS Methodology for Assessing Procurement System MOA Ministry of Agriculture MTEF Midterm Expenditure framework MOF Ministry of Finance MOU Memorandum of Understanding NBE National Bank of Ethiopia NCB National Competitive Bidding NRMD Natural Resource Management Directorate OECD Organization for Economic Cooperation and Development OFAG Office of Federal Auditor General ORAG Office of Regional Auditor General PAP Program Action Plan PBS Protection of Basic Services PEFA Public Expenditure Framework and Accountability PFM Public Financial Management P4R Program for Result RED&FS Rural Economic Development and Food Security SBD Standard Bidding Document SLM Sustainable Land Management SNNP Southern Nations, Nationalities and People SPG Special Purpose Grant TOR Terms of Reference USAID United States Aid for Development WoA Woreda Office of Agriculture WoF Woreda Office of Finance WUA Water Users Association ZoF Zonal Office of Finance 4 1. Conclusions 1.1. Reasonable Assurance 1. As per the World Bank Policy and Directive for Program-for-Results Financing (P4R) and the P4R Fiduciary Systems Assessment Guidance Note, the fiduciary team assessed whether the Program’s fiduciary systems provide reasonable assurance that financing proceeds will be used for the intended purposes, with due attention to the principles of economy, efficiency, effectiveness, transparency, and accountability. 2. Overall, the fiduciary assessment for this operation concludes that the examined program financial management and procurement systems are adequate to provide reasonable assurance that the financing proceeds will be used for intended purposes, with due attention to principles of economy, efficiency, effectiveness, transparency and accountability, and for safeguarding Program assets once the proposed mitigation measures have been implemented. Appropriate systems to handle the risks of fraud and corruption, including effective complaint-handling mechanisms, have been agreed on and established. 1.2. Risk assessment 3. The overall fiduciary risk for the program is assessed to be ‘Substantial�. The key identified risks with the mitigation measures are discussed below: • Financial management: (i) inadequate operating budget for the Agriculture sector, which affects the monitoring and supervision functions of the offices; (ii) challenges in IBEX connectivity and access problems to different units resulting in delay of reporting; (iii) weakness in monitoring of advances, which results in audit qualifications; (iv) delay in the external audits of some of the implementing entities and delay in taking timely action which results in adverse and disclaimer opinion on the financial statements; and (v) weak property management and internal audit leading to weak in internal control as reflected repeatedly in audit reports. The mitigating measures are preparation of appropriate annual work plan and budget for earmarked budget of the agriculture sector allowing implementing entities with the resources to carry out the program; providing access to relevant units such as internal audit and budget to the IBEX system; establishing mechanisms of monitoring advances and taking action on uncollectable balances; agreeing timetable for implementing entities to be up to date with their external audits and monitoring audit report findings; and strengthening the internal control weaknesses through internal and external audit reviews and recommendations. • Procurement: (i) The Regulatory bodies both at federal and regional level have no adequate capacity to deliver their oversight responsibilities; (ii) Inefficiency in the procurement processing and decision making process; (iii) Lack of independence in the procurement 5 complaint handling system and inaccessibility for bidders at local level and; (iv) Gaps in procurement planning, bidding document preparation, evaluation, contract award, and contract management at all levels; (v) Procurement of sector specific requirements is carried out inconsistently and in some regions by actors that do not have procurement structure and capacity; and (vi) Inadequacy assessment of procurement system by independent bodies to inform gaps and guide future system strengthening initiatives, etc. (vii) Procurement experts lack sufficient skill in procurement cycle and contract management. To address these risks, proposed mitigating measures include: revision of the pool manual that would adequately cover how to handle sector specific procurements and rollout to woredas; updating the simplified procurement directive and rollout to regions and woredas; implementing procurement KPIs in the MoA and EIAR and report procurement performance periodically; carry out procurement audit in all IAs of the program including at least 20% of the woredas in the targeted regional annually; establishing Independent Procurement Appeal Body in subnational states and woredas where it doesn’t exist; ; implementing the Methodology for Assessing Procurement System II (MAPS II); and procurement cycle management and contracts management training to staff of the program implementing units as part of the annual fiduciary forum. • Fraud and corruption:(i) lack of staffing of Ethics and Anticorruption Officers at some woredas; (ii) recording and reporting as well as knowledge/skill gap; (iii) gaps in information sharing, transparency and people’s participation. To address F&C and the compliant handling risk, CALM program will be aligned to the Anti-Corruption Guidelines (ACG) as well as the National Compliant Handling Proclamation. The MOU signed between the Bank's Integrity Vice Presidency (INT) with the FEACC on October 3, 2011 provides the framework for cooperation and sharing of information on fraud and corruption allegations, investigations and actions taken on the Program, including on procurement. The MOU will provide the Bank and INT with the basis for expanding the existing working relationship to cover future cooperation in investigation under the Program when needed, and for helping to ensure that the Government of Ethiopia and the FEACC can implement their commitments under the Anti-Corruption Guidelines. FEACC will accomplish the tasks in cooperation with the Federal Office of the Attorney General, REACCs and others concerned. The National Compliant Handling Proclamations and the institutional level operational guidelines clearly define the procedures to follow under corruption offences as well as for administrative complaints. The Anti-Corruption Guideline (ACG) will also be applied related to the Program. 1.3. Procurement exclusions 4. Detailed review of the program components shows that the program envisages procurement of various Goods and Services at Federal, Regional and Woreda level. The aggregate volume of the procurement activities is estimated to cost $58.2 million which covers less than 3% of the total program cost. Procurement of Goods and Non-consulting services covers about 49% ($28.2 million) of the total procurement while 47% ($27.5 million) is for recruitment and deployment of staff at different levels. Though the procurement profile is likely to change and increase during the actual implementation of the program, the estimated size of the largest single contract is not more than $4.3 million which is related to procurement of 650 motor cycles. In view of this, the team does not expect any high value contract that falls under OPRC threshold that should be excluded from the program or does not propose to seek an exception. 6 2. Scope 5. Program Background. The proposed operation will help Ethiopia address international and national policy commitments that seek to address climate resilience and mitigation goals, and promote the sustainable management of natural resources. The overall PDO for this program is to strengthen climate- smart (mitigation and adaptation) land management and administration in selected, non-pastoral rural areas. The Program will deliver performance-based financing for the third phase of the Ethiopia Strategic Investment Framework (ESIF-3) and to an amount equivalent to 29.8 percent of GoE’s expenditures on the Program after exclusions. 6. Implementation arrangement. For the carrying out of the fiduciary responsibilities, the roles and responsibilities of the implementing entities is presented below: a. Financial management. The financial management responsibilities of the government are organized at federal, regional and woreda levels. Although the project is implemented by the MoA as the lead implementing entity, the overall financial management responsibility of the program which includes the release of resources, the consolidation of reporting and auditing of the program will lie with the MoF. Each implementing entity will continue to be responsible for the budget monitoring, accounting, internal audit and reporting their own transactions. At the regional government level, Bureaus of Finance (BoFs) will have similar responsibilities as MoF in terms of financial management. Woreda Finance offices will be responsible to report to regions on their monthly expenditure for the agriculture sector. b. Procurement. Procurement activities in the program will be carried out based on the procurement structure established at Federal, Regional and Woreda level. In view of this, the public bodies covered in the program will carry out the day to day procurement activities following the government’s procurement procedure and decision-making structure. On the other hand, the procurement regulatory bodies established at federal and regional level shall be responsible for monitoring procurement implementation and audits while procurement complaints will be handled by the Head of Public Bodies and the appeal system as organized at federal, regional and Woreda level. Procurement at Woreda level will be implemented at WoFED following the structure and procedure described in the pool system. c. Fraud and corruption; complaint handling mechanisms. In relation to Fraud & Corruption and compliant handling mechanism, the FEACC and the REACCs have a responsibility of prevention activities while curative practices are handled by the Ethiopian Federal Attorney General (Proclamation No.943/2016) and counterpart Regional Prosecution Offices.1 Overall, there is an established system to handle the risks of Fraud and Corruption, and complaint-handling including checks and balances. Thus, the program will rely on FEACC, which will be responsible to prepare a national report on anticorruption efforts across the country and share this information to the Bank. The MOU signed between the Bank's Integrity Vice Presidency (INT) with the FEACC on October 3, 2011 provides the framework for cooperation and sharing of information on Fraud and Corruption allegations, investigations and actions taken, including on procurement. • Ethics and Anti-Corruption. FEACC/ REACCs focus on expanding and promoting ethics and anti-corruption education and preventing corruption while the Federal Attorney General deals on investigation and prosecution of allegations. FEACC is also responsible for coordinating efforts 1 Federal Attorney General Establishment Proclamation No.943/2016, Federal Ethics and Anti-Corruption Commission Proclamation No. 880/2015 7 of anti-corruption across regions, sectors and for preparing a countrywide report. Currently, FEACC is carrying out revisions on legislations with the view of strengthening its commitment in line to the reform undergoing in the country. With the issuance of the regulations: 144/2008 (Federal); 154/2019 (Amhara) and 146/2004 (Oromiya), the Commissions reach has been further extended to cover public institutions, including CALM implementing institutions (MoA, EIAR; regional and Woreda counterparts, and the regional Bureau of Rural Land Management and Use /BRLAU). • Complaints on maladministration and poor service delivery. Regional States have enacted regulations for the establishment of Public Compliant /Grievance Handling Mechanism (GRM) that is accountable to the regional President and the respective zonal and Woreda Administrators.2 The regional States have also introduced legislations on land administration and use system and formed rural land Legal Support and Appeals follow-ups units at regional, woreda and kebele/ got levels. At kebele levels formally assigned land administration expert is responsible to coordinate the functioning of the system while kebele and got/village level public committees (5 members at Got/ village and 12 at kebele level) that were established for the particular purpose are responsible for dispute resolution and or provide evidential support to the woreda. For that reason, the respective arrangement has been valued across the visited woredas as an effective system of addressing land related complaints and contributed to reduction of workload at woreda and regional levels. • Bidder Enquiries and complaints. There is a system and procedures for handling bidder’s enquiries and complaints at federal, regional and woreda levels. The Ethiopian Procurement and Property Administration Proclamation constituted a "Board for Review and Resolution of Complaints in Public Procurement ", which is responsible for the review of procurement appeals and provide decisions. This arrangement and procedures provided on the proclamation will also be used for procurement undertakings of the Program. • Fraud and corruption. Internal control systems support the fight against Fraud and Corruption as well as misconducts. The Office of the Auditor General (OFAG) and Office of the Regional Auditor General (ORAG) are strong arms of the people’s parliament in the contro l of public resources. The internal audit system structured within the Federal and Regional public institutions (including in MoA and EIAR), and their counterparts at regional level; the pool system in Woreda Office of Finance (WoFs) also display the effort exerted towards controlling public resources. Thus, the legal framework and the institutional arrangement is supportive of Fraud and Corruption prevention and control and complaint handling efforts. Complaints handling system are institutionalized at all levels of the government. 7. Expenditure framework. In FY19, the budget for the activities to be included in the Program before exclusions amounted to US$364.4 million, and US$241.6 million after exclusions (see Table 1). Based on budget trends over the period FY16-FY19, and a projected annual exchange rate depreciation of 6 percent, CALM Program expenditures over the five-year program period are estimated at US$2,523.9 million, amounting to US$1,675.7 million after exclusions. 2 The proclamations or regulations are: Amhara National Regional State Public Service Rendering Grievances submittal, inquiry and Decision Procedure Determination Regulation No.55/2000 and revised regulation No. 130/2007 establishing Good Governance and Environmental Affairs Office; Proclamation 103/2003 and Regulation to Provide for the Oromia National Regional State Administrative Matters Public Compliant and Grievance Handling No. 154/2005; Tigray National Regional State Administrative Matters Public Compliant and Grievance Handling Regulation No.79/2005; Addis Ababa City Government Grievance and Compliant Submission Inquiry Procedure and Accountability Regulation No.48/ 2012. 8 8. Three broad elements of GoE expenditures on the Program are excluded from support. First, capital expenditures related to irrigation are excluded at the request of GoE, as the Environmental and Social Systems Assessment (ESSA) determined that capital expenditures could include significant new construction that could introduce environmental and social risks. Second, activities in the Afar and Somali regions will be excluded, because in these predominantly rangeland areas watersheds are less suitable as planning units given the physical and social characteristics of these rangelands; and, provisions for issuance of communal pastoral land rights are at an earlier stage of development. Thirdly, expenditures already financed by World Bank-supported IPF operations and other development partners are excluded, as are expenditures under the World Bank-supported Enhancing Shared Prosperity through Equitable Services (ESPES) PforR operation (Credit 6131-ET). Table 1: Expenditures on ESIF Sub-components to be included in the CALM Program (Indicating exclusions from the Bank-supported expenditure framework) 9 ESIF Sub-Component Expenditure US$m Forecast (US$m) Total # Activity Financing 2016 2017 2018 2019 FY20 FY21 FY22 FY23 FY24 FY20-24 Results Area 1: Participatory Watershed Management 1.1, 1.2, 1.5 Afar and Somali Excluded 25.0 36.1 36.4 36.8 37.1 37.5 37.9 38.2 38.6 189.3 1.1, 1.2, 1.5 Development partner financed (including RLLP and AGP-II) Excluded 49.2 39.2 39.6 40.0 40.4 40.7 41.1 41.6 42.0 205.8 1.1, 1.2, 1.5 ESPES-financed Excluded 35.8 37.8 40.3 42.9 45.7 48.7 51.8 55.2 58.8 260.2 3.2 MoA Extension Dir. Capital (may include construction) Excluded 0.0 0.0 0.0 0.0 2.8 2.8 2.9 2.9 3.0 14.3 3.3 EIAR and RARI Capital (may include construction) Excluded 0.0 0.0 0.0 0.0 5.1 5.4 5.8 6.2 6.6 29.1 1.1, 1.2, 1.5 BoAs Capital (may include irrigation) Excluded 0.0 0.0 0.0 0.0 19.5 20.8 22.1 23.6 25.1 111.1 1.1, 1.2, 1.5 Watershed development and management Recurrent 97.0 105.9 112.8 120.1 122.2 124.3 126.4 128.6 130.8 632.2 Capital 15.0 16.1 17.2 18.3 - - - - - - SPG - - - - 20.8 31.9 51.0 70.1 81.3 255.0 3.2 Building extension service capacity Recurrent 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.4 Capital 1.7 2.4 2.5 2.7 - - - - - - SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 3.3 Building research capacity for SLM Recurrent 13.6 15.8 16.8 17.9 18.2 18.6 18.9 19.2 19.5 94.4 Capital 4.2 4.2 4.5 4.8 - - - - - - SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 3.1, 4.1, 4.2, 4.3 Policy, institutional, regulatory environment Recurrent 10.0 9.0 9.6 10.2 10.9 11.6 12.4 13.2 14.0 62.2 SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 5.1, 5.2, 5.3, 6.4 Building the SLM knowledge base Recurrent 10.0 9.0 9.6 10.2 10.9 11.6 12.4 13.2 14.0 62.2 SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 6.1, 6.2, 6.3 Management, monitoring and reporting of ESIF Recurrent 10.0 9.0 9.6 10.2 10.9 11.6 12.4 13.2 14.0 62.2 SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 Sub-total 271.6 284.6 299.0 314.4 357.0 378.1 407.6 437.7 460.4 2040.9 Sub-total after exclusions 161.6 171.6 182.8 194.7 206.5 222.2 246.0 270.1 286.3 1231.1 Results Area 2: Rural Land Administration 2.2-2.6 Afar and Somali Excluded 0.3 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 2.6 2.2-2.6 Development partner financed (including RLLP, REILA, LIFT) Excluded 2.8 2.5 2.6 2.6 2.6 2.7 2.7 2.7 2.7 13.4 2.2-2.6 BoLAUs Capital (may include construction) Excluded 0.0 0.0 0.0 0.0 1.0 1.1 1.2 1.3 1.3 6.0 3.2 MoA Extension Dir. Capital (may include construction) Excluded 0.0 0.0 0.0 0.0 2.9 3.1 3.3 3.5 3.7 16.5 2.2-2.6 Improving land tenure and administration Recurrent 25.2 30.3 32.3 34.4 36.7 39.0 41.6 44.3 47.2 208.8 Capital 0.8 0.9 0.9 1.0 - - - - - - SPG - - - - 24.0 24.6 28.4 32.1 35.9 145.0 3.2 Building extension service capacity Recurrent 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.5 Capital 1.7 2.4 2.5 2.7 - - - - - - SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 3.1, 4.1, 4.2, 4.3 Policy, institutional, regulatory environment Recurrent 3.2 3.8 4.1 4.4 4.6 4.9 5.3 5.6 6.0 26.4 SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 6.1, 6.2, 6.3 Management, monitoring and reporting of ESIF Recurrent 3.2 3.8 4.1 4.4 4.6 4.9 5.3 5.6 6.0 26.4 SPG - - - - 2.5 2.5 2.5 2.5 2.5 12.5 Sub total 37.3 44.4 47.2 50.0 84.6 88.5 95.7 103.3 111.0 483.0 Subtotal after exclusions 34.2 41.3 44.0 46.9 77.5 81.1 88.1 95.3 102.7 444.6 Total 308.9 329.0 346.2 364.4 441.6 466.5 503.4 541.0 571.3 2523.9 Total after exclusions 195.8 212.9 226.8 241.6 284.0 303.3 334.1 365.3 389.0 1675.7 Table 2: Program Financing Source Amount % of Total (USD Million) Government 1,175.7 70.2 IDA 500.0 29.8 Total Program Financing 1,675.7 100 10 9. Fiduciary Systems Assessment (FSA). The program expenditure framework for this program is financed through two modalities: (i) regular allocation to the agriculture sector which finances the recurrent costs of the sector (Federal program budget and general-purpose grant) and (ii) the earmarked budget to the sector which finances additional recurrent and capital investments of the program (Special Purpose Grant). Based on the scope and the expenditure framework of the program, the Fiduciary System Assessment (FSA) of the program was carried out on Federal, Regional and Local Government entities that will implement the program consistent with Bank policy and directive for P4R. The detail of the entities that were visited is included in Annex 10. 10. The FSA aimed to review the capacity of the implementing entities on their ability (a) to record, control, and manage all Program resources and produce timely, understandable, relevant, and reliable information for the borrower and the World Bank; (b) to follow procurement rules and procedures, capacity, and performance focusing on procurement performance indicators and the extent to which the capacity and performance support the program development objectives and risks associated with the Program and the implementing agency; and (c) to ensure that implementation arrangements are adequate and risks related to fraud and corruption as well as complaints handling mechanism are reasonably mitigated by the existing framework. The FSA examines the program expenditure framework to determine whether it is comprehensive, clearly defined, and whether it is part of the borrower’s budget and financial management processes. The risk mitigation measures have specific actions proposed that will help improve efficiency and performance monitoring of the financial management, procurement, fraud & corruption, and complaint handling systems. 3. Review of Public Financial Management cycle 11. In Ethiopia, Public financial management and procurement is governed by the finance administration proclamations and the procurement and property administration proclamations respectively issued by the federal and respective regional states. Besides, secondary manuals and supporting procurement and supporting documents were issued that includes Directives, Manuals and standard bidding documents at both levels. 12. In the last 16 years, the GoE has been implementing a comprehensive public financial management (PFM) reform through the Expenditure Management and Control sub-program of the Government’s Civil Service Reform Program. Legal framework is established and various reforms3 have been made. To further enhance these reforms and introduce new reforms, the Government (led by MoF) has prepared and is implementing a five-year PFM strategy for the period of 2017/18-2021/22 which is financed by the government and Development Partners. 13. The procurement legal framework at the federal level was reviewed by independent consultants (CPAR 2010) and found to be compatible with the United Nations Commission on International Trade Law (UNICTRAL) Model Public Procurement Law. The proclamation, among other things, organizes public procurement under procurement operation and oversight functions. The procurement operational function in turn is organized in a decentralized structure mandating public bodies at federal and regional level to carry out their own procurement activities through segregated decision-making structure. The public procurement system has undergone through long years of reforms and capacity strengthening endeavors. Over the years and with resources provided under different Bank funded projects (PBS II and III, ESPES Additional Financing and PFM standalone projects), the public procurement reform agenda has progressed from establishing the basics in public procurement to aspects that could improve efficiency, transparency 3 Medium-Term Expenditure Framework, government budget preparation and administration, cash management and disbursement, government accounting and reporting, procurement and property administration, internal audit information system (IBEX & IFMIS) and Financial transparency and accountability. 11 and value for money in the procurement operation. The main procurement reform activities currently under implementation are procurement professionalization training, procurement performance measurement and reporting tool and e-GP. However, the progress made so far in improving the public procurement system, the remaining gaps and future direction has not been independently assessed and documented. The assessment could help to set the procurement reform agenda based on evidences and realties on the ground and to feature recent developments in public procurement arena and benefit from international practices. 14. Furthermore, in recognition to the threat of Fraud and Corruption, the Government has established the Federal Ethics and Anti-Corruption Commission (FEACC) in May 2001 (Proclamation No. 433/2005) with the mandate to carry out both preventive and curative approaches for combating corruption in any public offices and enterprises. Likewise, starting 2007, all Regional States proclaimed and established their respective Regional Ethics and Anti-corruption Commissions (REACCs). Since 2016, the mandates of the Federal Commission have been revised and limited to prevention activities while the prosecution and investigation practices were transferred to the Office of the Federal Attorney General (Proclamation No.943/2016) and Federal police. The Proclamation also mandated FEACC to coordinate anti-corruption efforts across regions, sectors and preparing a countrywide report. Fraud and corruption prevention and control has been also strengthened by the issuance of regulations that determined the structure for the placement of ethics liaison officers that extended the Commissions reach to cover public institutions at Federal, Regional, Zone and Woreda levels, including in the program implementing institutions. There is also a system for handling complaints on maladministration and poor service delivery, which is supported by regulations issued at regional level. Accordingly, the Public Grievance Handling Mechanism (GRM) has been organized under the respective regional Presidents, Zone, and Woreda Administrators. In addition, the regional states have also enacted a regulation for the establishment of Rural Land Administration and Use System, with rural land legal support and appeals follow ups structure through which land related cases/ complaints would be investigated prior to submission to the judicial system. Conversely, if the case was submitted to the judiciary prior to the consent of the land administration system, the judiciary will send the case back to the unit for investigation and recommendation. 15. Public Expenditure and financial Accountability (PEFA)- The PEFA assessment for 2018 is underway and is expected to be finalized by December 2019. The latest PEFA assessment was conducted in 2014 as indicated above. The PEFA indicators had shown improvement in the PFM systems of the country over the years. The 2014 PEFA highlighted notable improvements in expenditure deviation, revenue forecasting, arrears management, Internal Control system and federal level audit coverage, which has increased to 100%. The areas the government needs to work on were noted to be legislative scrutiny of audit reports, oversight of fiscal risk from public sector entities, public access to key fiscal information, effectiveness in collection of tax payments, predictability of funds for commitment of funds and quality of in year budget execution reports, the extent of unreported government operations, comprehensiveness of information included in budget documents, availability of information received by service delivery units, etc. Several of these issues are being addressed through the Expenditure Management and Control Program (EMCP) - Government of Ethiopia’s flagship PFM reform program, although the intervention and the reform work needs further strengthening. The findings of the PEFA assessments feed into the EMCP Annual Work Plan. The summary results of the 2014 PEFA are found at Annex 1. 16. Continuous Audits: Since the inception of the Protection of Basic Services (PBS) program which supports basic service delivery at the lower level, continuous audits have been assessing the internal control systems at the Woreda level on a regular basis. Agriculture is one of the sectors being supported through the program. The audits are conducted by Office of Federal Auditor General (OFAG) across the country, on sample Woredas. The key weaknesses noted during the review of such woreda level financial management systems reveal that findings are repetitive from year to year in the areas of cash management, receivables and payables, property management, and proper documentation on expenditures. MoF is following up proactively the implementation of action plans sent to the regions to correct these weaknesses. 12 However, the persistence of these problems from one year to the other suggests that this follow up is not adequate. The detail findings noted on such reports is attached on Annex 2. 17. The 2016/2017 Woreda PFM Benchmarking: To address systemic issues, the Woreda PFM benchmarking exercise is being carried out by the governemnt. The final outcome of this exercise would be PFM reform of the Woredas, starting with the weakest. As per the schedule, all regions including Addis Ababa and Dire Dawa city administrations, carried out the assessment for their Woredas and submitted the result to MoF. The assessment was conducted based on 22 performance indicators (PI), some of them similar to PEFA indicators. In general, weakest links across the woredas involve public access to fiscal information, complaint handling mechanism on procurement and performance of internal audit. Also, the average scores for Annual budget preparation and approval process, property management, control and disposal, readiness for external audit and Woreda council support, follow up and scrutiny were not satisfactory. Therefore, capacity building training and follow up is required to improve the performance of these indicators. Performance indicators under credibility, budget classification and chart of accounts, information and documentation included in the budget, disbursement based on the approved budget, revenue plan and follow up on collection and payroll process and control were performed well. The good performance of these indicators should be continued. 18. In addition to the above existing assessments, based on the field visits conducted for this program, the key findings/performance issues and risks on the PFM cycle FM issues are detailed below: 3.1.0. Planning and budgeting 3.1.1. Adequacy of budgets 19. Budget preparation: Both at Federal and Regional levels, plan and budget is prepared based on the respective Financial Administration Proclamations, Directives and manuals. The budget circular issued by MoF and BoFs incorporates guideline on the preparation of the annual budget and indicative ceilings for recurrent and capital expenditures. The recommended budget is submitted to Council of Ministers, regions and woreda cabinets for endorsement. The final budget is approved by parliament (at Federal level) and by regional and woreda councils. At all visited entities, the EFY 2011 budget was prepared in line with the budget calendar. Budget for the year was timely approved by parliament and region and woreda councils. The approved budget was notified timely to BIs except at SNNPR which delayed by a month in notifying the EFY 2011 budget to BoA and Regional Agricultural Research Institute (RARI), while Hadya and Sidama ZoFs delayed notifying the budget to the visited woredas by 3 months. This has impact on timely utilization of the budget and service delivery. Furthermore, inadequate operation budget at visited woredas (especially in SNNPR) was noted. This was mainly due to under collection of own sources of revenue than planned. Major portion of the operation budget is planned to be financed from own source of the revenue whereas treasury budget is mainly allocated to salary. Inadequate operating budget has impact on results as the monitoring activities are not well performed by development agents. The risk mitigating measure proposed is for the government to have earmarked budget allocated to implementing entities to avoid risks of non-delivery on the required results. 20. Budget control and utilization: Once the recurrent and capital budget is split by program, institution and item of expenditures, it is recorded in the IBEX, and manual budget control ledger. Each request of payment is tracked against the budget balance before payment is made. At the end of the month, budget vs. expenditure report is produced from IBEX and is sent to budget holders for review. At all visited entities, the budget control at transaction and report level was found to be satisfactory. Furthermore, as shown in Annex 3, the budget utilization of the visiting regions for the proposed program expenditure boundary, was found to be satisfactory which is above 90% (table below). In general, the budget performance showed that 13 annual budget is prepared realistically with due regard to government policy and implemented in an orderly and predictable manner. Budget Utilization over three years 100 90 80 Percentage 70 60 50 40 30 20 10 2008 2009 2010 Year - Ethiopian calendar 21. Transparency: Only 14% of the visited entities (3 out of 22) have disclosed their EFY 2011 budget to the public on the notice board. In previous years, a remarkable achievement has been registered on the Financial Transparency and Accountability (FTA) activities though the support of the PBS project. However as noted during the assessment, the current activity on FTA was not satisfactory. The proposed mitigation for the program is to disclose to the public at least the consolidated annual work plan and program audit report to the public. 22. Arrangement for the program: For this program, implementing entities will receive funds for the agriculture sector through the general-purpose grant subsidies as well as through the earmarked budget (special purpose grant) that will be allocated to the sector. The regions will in turn allocate to woredas along with their own resources. The Government’s chart of account accommodates budgets and expenditures for this program. The annual budget of the general-purpose grant will be included in the annual budget proclamations of MoF and regional governments. The earmarked budget of the program will be proclaimed at the federal level under the MoA after following the government’s approval cycle. Through the earmarked budget, the government needs to ensure that all implementing entities, at federal, regional and woreda levels receive resources for implementation of the project as per the annual work plan and budget. 3.1.2. Procurement planning 23. Preparation: The assessment noted that all of the visited IAs prepare procurement plan based on the procurement plan template provided in the relevant Procurement Directive or Manual and consist of information like: description of item to be procured, source of financing, estimate contract amount, procurement category, procurement method, procurement type, and procurement lead time for notice of invitation and contract completion. The procurement Units in the implementing agencies prepare procurement plan based on users request as approved by the relevant official and supported by budget. In accordance with the procedure, procurement plan is reviewed at different level including by Bid Endorsing Committee and finally approved by the Head of the public body. The approved procurement plan shall be shared with the federal public procurement agency and regional procurement regulatory bodies, as appropriate. But there is no practice in publishing approved procurement plans both at federal and regional level. 14 24. Implementation: The assessment revealed gaps between the actual implementation and plans particularly with regard to timelines and cost. In most cases, activities are not implemented as per the planned time frame and there is huge difference observed between the actual contract amount and the cost estimate as indicated in the procurement plan. This is due to inadequate preparation, lack of collaboration with the relevant stakeholders and in adequate market assessment and also due to the limited practice in updating procurement plans to respond to changes in the market, requirement, timeframe, cost etc., It is also noted that procurement plans are usually prepared as a formality for budget processing purpose rather than to use them as a management tool useful to strategize and monitor procurement activities. For program implementation, the gaps shall be addressed through training and skill development during the proposed annual fiduciary forum. 3.1.3. Procurement profile of the program 25. General Procurement profile in the IAs: Based on the data collected from all the visited Implementing agencies, the assessment revealed that, in the last two years, on average close to 60% of the total expenditure was spent through procurement. The share of procurement expenditure from the total expenditure is much higher in the federal IAs as compared to regional or local expenditure. In the MoA, the average share of procurement expenditure for the last two years was 75% of the total expenditure while it was 52% in the Ethiopian Agriculture Research Institute (EIAR). (Figure 1) The average procurement expenditure in 2016/17 and 2017/18 budget years for all of the visited IAs was USD 60 million and USD 55 million respectively. The volume of procurement in the Ministry of Agriculture is the largest amounting to two third of the aggregate procurement carried out in all the visited IA. In terms of category, the procurement of Goods assumes the largest share amounting to 73% and 77% in 2016/17 and 2017/18 budget years respectively followed by works procurement which is close to only 7% of the procurement expenditure. Procurement Expenditure against Procurement Expenditure at federal, total expenditure (USD) in federal Regional and Woreda level entities 50,000,000 IAs 20,059,127 18,627,009 40,000,000 30,000,000 20,000,000 10,000,000 2310196 2228453 370235313989 0 Ministry of EARI AVERAGE FEDERAL AVERAGE AVERAGE WOFED Agriculture IAS SUBNATIONAL 2016/17 Total Expenditure 2016/17 Procurement Expenditure 2017/18 Total Expenditure 2016/17 2017/18 2017/18 Procurement Expenditure 26. Figure 2 shows the average procurement expenditure at Federal, Regional and Woreda level based on procurement data from MoA and EIAR at Federal level, Bureau of Agriculture and Natural Resource, Bureau of `Rural Land Administration and Regional Research Institute from Oromia, SNNPR and BG regions and WoFs. The chart shows that the largest share of the procurement in the last 2 years was carried 15 out at federal IA as compared to the regional and woreda level procurement expenditures. In 2017/18 budget year, the average procurement at federal level was 8 times higher than the average procurement at Sub national. Likewise, the procurement volume in the MoA is much higher that of the EIAR. In 2017/18, the total value of procurement in MoA was almost 6 times higher than the procurement in EIAR ($31.8 million Vs $5.5 million). Given that the procurement expenditure represents the largest share of the total expenditure in the sector, the procurement performance is essential for the achievement of the program objectives and the broader development objectives in the country. Thus, the procurement implementation and performance in the agriculture sector requires close follow up and support. 27. Procurement profile of the program: Detailed review of the program components has shown that the program envisages procurement of various Goods and Services at Federal, Regional and Woreda level. The procurement activities at the federal level will include equipment, vehicles, IT Equipment and materials. However, the size of procurement from the total program cost is minimal which is less than 3%. The largest share of the procurement would be carried out at the federal level implementing agencies MoA and EIAR. The total amount of the procurement activities is estimated to cost $58.2 million of which about 49% ($28.2 million) is for procurement of Goods and Non-consulting services and 47% ($27.5 million) is for recruitment and deployment of staff at different levels. The estimated size of the largest single contract is not more than $4.3 million which is related to procurement of 650 motor cycles. The likelihood of a single contract amounting to or exceeding more than 25% of the program expenditure is low for this PforR Program. Further follow-up and monitoring of procurement activities would be carried out to ensure that no procurement contract within OPRC threshold would be carried out under the program. The procurement activities envisaged under the program and rough estimated cost is presented in the below table: Table 3: Procurement profile Department Procurement activities and estimated cost ($) Vehicles and Tools and Non-consulting Works Staff cost Motor Cycles materials services Land 2,400,000 7,100,000 27,000,000 Administration Rural Land 2,000,000 1,200,000 Administration Natural resource 5,000,000 10,500,000 2,300,000 Department 3.2. Budget execution 3.2.1 Treasury management and funds flow 28. Fund transfer and predictability: After the annual budget is approved and apportioned by program/institution and item of expenditure, each BI (at Federal level, Region and Woreda) prepares and submits a forecast/action plan of its monthly cash requirements to MoF, BoFEDs, ZoFs and WoFs respectively. BIs at Federal and Regions uses Zero balance accounts. At woreda level, WoFs maintain a single pooled bank account in which monthly transfer from BoFEDs/ZoFs is deposited. Collection of own source revenue is also deposited in to this account. The assessment noted that BIs at federal and BoFEDs and WoFs receive the monthly funds in a timely manner. However, transfers in the first quarter are generally low due to the revenue collection cycle of the government which picks up in the second quarter. Treasury funds are available in an orderly and predictable manner. However, woredas are expected to finance portion of the annual budget (substantial operating budget) from collection of owns source of revenue and yet visited woredas (especially in SNNPR) collect below the plan and as a result could not finance the budgeted activities. If the situation continues, this pauses risk on achieving results required by the proposed program. 16 The mitigating measure to ensure that the government allocates enough budget to implementing entities to deliver their work programs. 29. Fund flow to the program: The IDA funds of the program will be channeled to MoF from IDA. The government has confirmed that the money will be deposited into a designated account to be opened at the MoF-COPCD for this program at the National Bank of Ethiopia. Further disbursement to the implementing agencies will be made from this account through an account to be opened and maintained at the MoF. All implementing entities will receive resources based on the approved annual work plan and budget of the program from MoF, BoFs and WoFs. Disbursement of program funds will be made only upon achievement of the disbursement linked indicators (DLI) from IDA. Upon achievement of the indicators, the MoA through MoF will inform the World Bank and provide evidence as per the verification protocols, as justification that results for the DLI have been met. Disbursement requests will be submitted to the Bank using the Bank’s standard disbursement forms signed by an authorized signatory. The program will have advances and prior results. Details of the key disbursement issues will be spelt out in the Disbursement Letter. It is important to note that although PforR operations do not link disbursements to individual expenditure transactions, the aggregate disbursements under such operations should not exceed the total expenditures by the borrower under the Program over its implementation period. 3.2.2 Accounting and financial reporting 30. Accounting: All visited entities use the government accounting system, which is a double entry and a modified cash basis of accounting. Financial administration proclamation, directives, accounting manuals issued by Federal as well as by Regions are available for references at visited entities. All use IBEX system to record transaction and produce reports. Although IFMIS is currently in use at some Federal BIs, it is still at a pilot stage and not yet rolled out at the two proposed implementing entities (MoA & EIAR). Three visited regions (out of four) have started to operate the IBEX system on online mode. This is a good improvement as it enables, BoFEDs /ZoFs to obtain reports online. However, there is high connectivity problem especially at woredas due to slow internet connection causing finance staff to be idle for 2 to 3 days. Due to this reason, at some visited woredas, the assessment team could not manage to obtain reports from IBEX. This has impact in recording transactions and producing reports timely. Furthermore, at visited entities in SNNP and Benshangul Gumuz, budget and internal audit sections do not have access to the IBEX server due to lack of Local Area Network (LAN) connection. As a result, the budget module in the IBEX system is handled by account section which is inappropriate from control perspective. Internal auditors at all visited regions have no access to the system and hence are not able to view reports from the system. BoFEDs’ support is required to connect these sections with the server using the local area network. Financial administration proclamation, directives, accounting manuals issued by Federal as well as by Regions are available for references at visited entities. 31. Reporting: All visited entities have closed the EFY 2010 (FY 2018) account. The monthly financial statement which incorporate trial balance, revenue, transfer, receivable, and payable and expenditure reports. Cash count and bank reconciliation are submitted timely both in soft and hard copies. BoFEDs also obtain reports online in regions where IBEX is operating in online mode. However, performing aging for receivable and payable and attaching with the reports have not yet been started at visited entities. The proposed mitigating measure is in the long run to resolve the connectivity issue of the woredas which cannot be addressed by this project alone. Furthermore, providing the budget and internal audit units access to IBEX will facilitate the segregation of duty and strengthen the internal control process. 32. Arrangement for the program: For this program, accounting will be governed by GoE’s accounting policies and procedures. For the earmarked budget of the program, as the current IBEX has challenges 17 accommodating earmarked resources, the implementing entities can use the IBEX on a standalone basis which can easily capture the line items of the activities. Each implementing entity will continue to account for expenditures incurred at their entity, retain documentation and submit financial reports to the next level for consolidation. Channel One Projects Coordination Directorate (COPCD) within MoF will provide oversight to the financial management functions of the Program at Federal level. The program should ensure that there are recruited/assigned finance officers at all levels of implementing entities to ensure timely recording and reporting of program transactions. MoF will submit quarterly consolidated unaudited interim financial report (IFR) prepared based on actual expenditures for the program within 90 days of end of the quarter. The format will incorporate both the reporting on the expenditure framework involving institutions at federal, regional and woreda levels for all financings of the program. The budget line items for reporting purpose are shown on Annex 7. The reporting on the earmarked resources will be prepared by each implementing entity and consolidated by the BoFs and finally by MoF. As the recurrent costs of the agriculture sector at the regional and woreda level are also included in the IDA funded ESPES program, it has been agreed that 70% of the recurrent cost of the agriculture sector will be allocated to the CALM Program whereas 30% will remain with ESPES. This arrangement will be documented in the PAD for CALM and also in an ISR for the ESPES program based on the guidance obtained from OPCS. The MoF has the responsibility to share the expenditure between these two programs semiannually and report to the Bank. Therefore, over all MoF will be responsible for the preparation of the program financial statement. 3.2.3 procurement process and procedures 33. Governing Rules and Documents: At the federal level, procurement is governed by the Procurement and Property Administration Proclamation (No. 649/2009) and the procurement Directive issued June 2010 and amended in December 2015. The proclamation, inter alia, stipulates the procurement organization at the federal level, the key procurement principles and operational procedures as well as complaint handling system. Currently, FPPAA is working on the revision of the procurement proclamation to ensure that it accommodates emerging developments and addresses gaps noted in the existing proclamation including regulation of the procurement of Stated Owned Enterprises that are not covered under the scope of the current proclamation. However, the process of amending the proclamation which has been started in 2014 is yet to be finalized and endorsed by parliament. 34. The sub national states have issued their own procurement Proclamations and Directives that were drafted in accordance with the federal procurement proclamation with minor differences to addresses regional specificity and contexts. In addition to the primary legal documents, procurement implementation at the federal and subnational level is supported by secondary procurement documents that provides step by step procedures and guidance for procurement experts and decision makers. The secondary procurement documents that were issued both at the federal and subnational states include Procurement Manuals, Standard Bidding Documents and Templates that are applicable under different procurement categories and scenarios. 35. Procurement Organization: Based on the respective proclamations, operational procurement follows a decentralized structure mandating public bodies to carry out their own procurement activities. The procurement role is generally shared among the procurement team, Bid Endorsing Committee and the Head of the public body. However, specific procurement organizational structure among subnational states show slight differences in structure, capacity, etc. Among other things, the procurement team is generally responsible to carry out the day to day procurement activities and the Bid Endorsing Committee is responsible to review and approve procurement decisions while the head of the public body is responsible 18 to review and resolve procurement complaints. This has strengthened internal control by ensuring clear segregation of roles and responsibilities among the key players and enhancing Check & Balance. Besides, common user items are procured using framework agreement established by a centralized body (Procurement and Property Disposal Service at the federal level). Though there are concerns of timeliness and quality, the centralized procurement allows public bodies to minimize transaction cost, benefit from economies of scale and increase negotiation power while balancing the decentralized structure. 36. Procurement at the Woreda level is centralized in the Woreda Finance and Economic Development Office which is responsible to consolidate requirements of the sector offices and process procurement following the prescribed arrangement and decision-making structure. The pool system is governed by the pool manual, that originated from MoF and adopted by each region. MoF revised the pool manual which, inter alia, revised the organizational structure and staffing requirement for all functions in the pool system including procurement. However, implementation particularly the organizational structure has not been consistent with the proposed structure in the revised manual across all regions. Besides, while the pool manual as an exception, allows sector offices to procure their own sector specific procurements out of the pool system, it is silent regarding the required procurement capacity they need to establish. As a result, sector offices like Agriculture office in Amhara Region, Project committee in Oromia carry out procurement of inputs required by the sector without procurement capacity, structure and staff. 37. Bid Invitation: The procurement rules (federal and subnational states) require bidding opportunities to be advertised openly in a media that has wider coverage. Based on the review of sample procurement documents, it was observed that, when procuring through open bidding (National or International), all IAs advertise bids on Addis Zemen Newspaper or Ethiopian Herald which have national coverage. The bid advertisement is normally prepared in accordance with the template provided in the procurement manuals (Federal and subnational states) and provide adequate information for potential bidders on the procurement under consideration. The information in the Bid Invitation Notice includes details on the procuring entity, description, bidding document collection and bid submission place/date/time etc. However, the assessment revealed areas for improvement particularly on the practice of stating number of bid floating days rather than fixing the exact bid closing/opening date and use of bid notices for purpose of prequalification document. In Oromia Regional Agricultural Research Institute (RARI) only, prospective bidders who are complying with the preliminary requirements disclosed on the Notice of Invitation are allowed to purchase the bidding documents, which implies that prospective bidders are rejected at early stage of the procurement process without following the proper bid evaluation and approval process. Besides, standard format and procedure were not applied, and the practice lacks consistency. 38. Bidding Documents: The Federal and sub national Governments issued Standard Bidding Documents applicable in procurement of goods, works and consultancy and Non-consultancy services under competitive procedures (NCBs or ICBs, or consultants shortlisted from the international market). The SBDs include all the required sections of bidding documents including Instructions to Bidders, Bid Data Sheet, Technical and Financial Schedules, General and Special Condition of Contract and different forms. Use of SBDs is mandatory in procurement financed from Government coffin including for procurements under this PforR program. However, the application of the SBDs has not been consistent. Procurement experts in Public bodies particularly at subnational and local level consider the SBDs bulky and complex that are relevant only for Works procurement. As a result, bidding documents prepared for the procurement of Goods and Services don’t follow the format provided in the SBDs that leads to relaying incomplete information to potential bidders. At the woreda level, Bidding documents contain only an abridged form of Instructions to Bidders (not more than a page) and specifications and misses most of the key sections of the bidding documents like evaluation criteria, conditions of contract etc. The request for 19 quotation in the visited woredas were also incomplete containing description of required Goods/services and quantity and lacks key information such as, required price validity time, payment modality and delivery or completion date etc. The assessment highlighted that this inconsistencies and incompleteness could be addressed by implementing the simplified procurement directive that has been prepared but not yet rolled out. 39. Procurement Methods: The federal and subnational states procurement rules allow use of six procurement methods namely Open Bidding, Request for Proposal, Two Stage Tendering, Restricted Competition, Request for Quotation and Direct Procurement. Open Bidding (national and International as determined based on the threshold, is identified as the default procurement method in all the procurement rules applicable at federal or subnational level. Besides, the respective procurement rules provide clear conditions for use of other methods including applicable threshold as determined by each subnational state. The assessment noted that procurement is largely carried out through open competition and the share of procurement through less competitive methods is not significant. 40. Evaluation: The Government procurement procedure (federal and regional) requires public bodies to carry out bid evaluation in accordance with the evaluation criteria stated in the bidding document. The assessment noted that there is a good practice in applying evaluation and post qualification criteria as provided in bidding documents. In some cases, the evaluation criteria and procedures were found to be irrelevant and inappropriate for the procurement at hand. For instance, in Oromia region for procurement of simple works contracts, merit point evaluation system has been applied in evaluating bidders’ qualification instead of determining qualifications through pass/fail criteria. Besides, evaluations in some cases lack sound judgment and determination of materiality. As a result, there is a tendency of rejecting competitive bids for minor nonconformities and deviations. 41. Award Decision: The assessment looked into the roles and responsibilities of bid evaluation and approval process which is found to be fairly balanced and distributed among different players. The procurement unit in the public bodies assume the responsibility of coordinating and leading bid evaluations including facilitating the establishment of technical evaluation committee (as required) while bid endorsing committee reviews and approves evaluation reports. The head of the public body, who does not involve in the procurement award decision, is responsible to receive, review and respond on procurement complaint. The bid endorsing committee members deliver procurement service on top of the core work responsibilities they have in the organizations. Thus, because of their competing responsibilities and tendency to avert risks, organizing regular and timely meetings among members of bid endorsing committees is found to be a challenge which leads to delays in procurement decisions making process. At woreda level, no standard template is used or applied to support the preparation of bid evaluations and hence, there is inconsistency and lack of completeness in the information provided in the evaluation reports. 42. Record Keeping: The Government’s procurement procedure requires procuring entities to maintain complete set of procurement documents at least for 10 years. In view of the importance of procurement files, a guidance note on record keeping and documentation is provided as part of the procurement manual. However, easy access to complete procurement records is a recurrent challenge almost in all agencies. The assessment revealed lack of systematic procurement Records Management System and the required facilities including absence of dedicated staff, shortage of office space and shelfs and computers to maintain hard and soft copy documents. The revised pool manual requires copy of procurement documents to be kept in the custody of a responsible person working under the Procurement and Property Administration Process. This has been practiced in some of the visited woredas but in most of the visited public bodies, procurement documents are kept in the finance unit as part of payment document. 20 43. Procurement Complaint Handling: At federal level and in most of the visited regions (except Oromia and Amhara), procurement complaint management follows three tier structure; at the level of public bodies, Complaint Handling Board (CHB) and court. At the procuring entity level, the Head of the procuring entity or his/her delegate is responsible to review and resolve procurement complaints. The head of the procuring entity is considered as independent as he/she is not involved in passing procurement decisions. In case of appeal, the complaint can be lodged to the CHB that involves representatives from the private sector and can be further escalated to court. In addition to the structural arrangement, the government procedure provides standstill period that halts the procurement process to allow aggrieved bidders lodge complaint. Though there are observed inconsistencies during implementation, the procurement complaint handling system is supported by procedures that provides step by step guidance and the standard business time. However, in Oromia and Amhara Regions, procurement complaints are handled solely by the public body and BoF and there is no established independent procurement complaint appeal body. Besides, there is no adequate records at regional level and disclosure practice of procurement complaints and resolutions at all levels. At Woreda level, the revised pool manual issued by MoF, requires Woreda Councils to establish an Independent Procurement Complaint appeal body/Organ that was supposed to review and resolve complaints that could not be resolved at the Woreda Office of Finance (WoF) level. However, implementation is not uniform in all of the visited regions. In some regions, the Woreda council (like Gambella and Benshangul Gumuz) has not established the complaint handling body as per the provision in the revised pool manual. In the Woredas of the other regions (Oromia, Tigray and SNNPR), compliant of aggrieved bidders, beyond the WoF Head, can only be entertained by the complaint handling structure established at regional level, which is restrictive for local level bidders. 3.2.4 contract administration 44. Procedures: Public Procurement Directive of the federal and regional governments provide reasonably adequate guidance on basic contracts administration procedures. The Directives elaborate the activities that should be carried out by the public body to ensure contract effectiveness, follow-up and contract closure. Besides, the Government’s Standard Bidding Documents contain sections on General Conditions of Contract and Special Conditions of Contract with provisions adopted from the Bank’s SBDs. However, contracts are prepared in an abridged form without containing the essential provisions that clarify the responsibilities between the contracting parties (supplier and public body). In some cases, the contract document provides only the agreed contract amount, the material and quantity to be delivered, delivery time and signature. When the contract document is prepared in a longer format, the responsibilities between the supplier and the public body would be unfairly unbalanced which ultimately lead to contract failure. 45. Capacity: The assessment reviewed the contract management capacity at the federal, regional and local level and noted that all the visited public bodies do not have adequate contract management structure and capacity. There are no dedicated contract management unit in any of the visited IAs. Instead, contract management responsibility rests with the procurement unit and carried out in collaboration with the requesting work unit. The roles and responsibilities between the procurement unit and the requesting work unit is not well defined and formalized and hence, there is a risk of oversight and inaction. The only exception is for procurement of “Works� contract that is entirely managed by the requesting work unit. At Woreda level, the revised pool manual prescribes for “Contract Administration� position in the procurement unit which has been adopted in some regions like in SNNPR and BG. Since procurement outcomes cannot be positive in the absence of successful contract management, it is imperative to ensure that adequate structure and capacity is maintained in public bodies based on the nature, size and complexity of contracts. Given that the procurement volume and size of contracts under the program are not expected to be big, , 21 the procurement team in the IAs can adequately manage contracts generated under the program. Besides, the procurement indicators which will be used to report procurement performance annually include indicators on contract management (Annex 8). This could provide opportunity to review performance in contract management and address gaps, if any. 3.3. Internal controls 3.3.1 Internal controls 46. The internal control procedures related to salary and non-salary expenditure are incorporated in the financial administration regulation, directives and manuals (budget, disbursement, cash management, accounts, property management etc.) both at Federal and regional level. As disclosed in the financial administration proclamation and directive, management of BIs take full responsibility on the internal control system. The control procedures are comprehensive and sound but there is challenge of implementation on some areas as described below: • Segregation of duties: At all visited entities, there is segregation of duty on payment cycles (request, verification and approval) and movement of stock and fixed assets (request, issue and receiving). However, at only 36% of the visited entities (8 out of 22) procurement and finance activities are carried out in separate directorate or section. In the remaining visited entities (64%), the two activities are under one directorate/section and led by one director/section process owner (finance & procurement directorate director/process owner). The segregation of these two duties would strengthen the internal control system further. • Cash management: The cash management control was found to be satisfactory at all visited entities. Cash requirements is forecasted in a monthly basis (region and woredas) and quarterly at federal visited entities. To minimize risk, limited cash is maintained (usually up to Birr 300,000) in safe box at visited implementing entities. Cash count is conducted daily or at least once a month and reconcile with ledger balance. Although at all visited entities, bank reconciliation is performed monthly and was up-to-date; various audit reports indicate that there continues to be delay in preparation of timely bank reconciliations. • Payroll control: At visited entities in federal and regional bureaus, there is Human Resource (HR) directorate that maintains personnel data base. Some of the visited entities use in-house developed payroll application to process the monthly payroll and the remaining use excel spread sheets. Almost all of the visited entities were paying the monthly salary through bank except for a woreda which didn’t have access to commercial banks. The personnel data base is maintained manually at HR directorate and Public services offices hence there is no integration. This has been reflected in PEFA 2014 report. Reconciliation is not made between the two sections (HR & accounts) although accountants reconcile the current month payroll with the previous one and sometimes the same is checked by internal and external auditors. Since major portion of the annual budget (about 87%) is allocated to salary at woreda level, it is important to roll out the payroll application. In addition, it is required to establish a system which enables the HR directorate and public services offices to ensure the payroll changes are correctly handled by account sections. • Asset management system: Although the control procedures over property management is well documented, implementation is a challenge at most visited entities. There is no 22 segregation of duties between property recording and custodian ship at 41% of visited entitles, no use of bin cards, stock cards and fixed asset register at 32% of the visited entitles. Identification number is not affixed on individual fixed items in 27% and the same is not recorded in fixed asset register or user cards. Although about 77% of the visited entities conducted inventory for the year ended July 7, 2018 (EFY 2011), none of them reconciled with records. Even at visited entities where progress is observed, the records lack completeness. Compliance with property management requirements remains a challenge at most government organizations and requires a nationwide reform such as automating the registry system is required. • Receivable and payable balances: as can be noted from the findings of the external audit reports of most of the implementing entities (Annex 5), the main findings are around advances and payable amounts that are not collected or paid timely. These amounts are long outstanding, and their collectability is doubtful unless close follow up and monitoring is done. The proposed mitigating measure is for all implementing entities to have a monitoring mechanism in place which segregates the advances with their age to allow management to take timely action on the long overdue balances. 3.3.2 Internal audit 47. At federal level, internal auditors are accountable to MoF. This to some extent has enhanced the internal auditors’ independence. This has not yet been replicated to the regions. At all visited entities, internal audit units exist. All prepared annual plan for EFY 2011(2018/2019) although coverage varies from entity to entity. At 27% of the visited entities, internal auditors have not done audit other than observing cash count. This is mainly due to weak capacity in terms of number and experience. At visited entities where internal audit coverage was found to be satisfactory, reports were produced and submitted to the bureau/WoF heads. However, internal audit findings are responded to in a timely manner only at some of the visited entities. Compared to finance sections, the internal auditors’ capacity in terms of number and experience was found to be weak at majority of the visited entities. At 50% of the visited entities the vacant positions for internal audit section was between 20 % & 30%. Also compared to other sections, the staff turnover is high for the internal audit unit because of lack of appropriate support from management, lack of independence and low salary. Due to lack of the appropriate skill, the internal auditors at the majority of visited woredas do not perform system and risk-based audit but are more on traditional audit-vouching (concentrating on per diem payments and cash shortages). Internal auditors at the majority visited woredas had no access to IBEX to view important reports rather they depend on finance officers to obtain print out reports. Reforms to enhance effective internal audit function at country level is required. 48. Arrangement for the program: despite the challenges that the function faces, each internal audit unit will continue to review the program. Some of the risks identified are inherent risks which can only be resolved with a wider PFM reform for the country, however at the sectoral level, given the existing legal frameworks, directives and manuals, each implementing entity should keep proper recording of its property, establish mechanism to properly follow up receivable and payable balances and the internal audit units should include this program in their work program to review and support the implementation. 3.3.3 Governance and anti-corruption 49. Following the recent democratization and development reform, encouraging results have been witnessed in the fight against corruption. In light of the above arrangement, FEACC/REACCs have undertaken several preventive and curative activities across the country. According to the 2015/16 Annual 23 Activity Report of sample assessed institutions, FEACC and all REACCs received 8,678 alleged corruption tip offs and complaints of which 64%, 17%, 14% and 5% were lodged in the sample institutions at all level at Federal, SNNP, Oromiya, Benishangul Gumz in that order. Out of 5,725 tip-offs under the Commissions' jurisdiction, the Commissions investigated 6,166 (107%) cases including those transferred from previous years. Similarly, sector-based ethics and anticorruption units have received 175 tip offs of which only 17 were passed to REACCs and involved the recovery of mishandled resources including intervention in terminating faulty procurement procedure. 50. The assessments indicate that the Legal Support, complaint handling /Appeal and Follow up Unit in Rural Land Administration and Use Office is found to be effective in addressing land related complaints, acquisition, administration and contributed to the reduction of workload at woreda and regional levels. For example, in one woreda, in the last six months alone, 11 complaints were resolved by the unit itself and 75% of the 35 cases sent to court were resolved /on the process of decision-making. 51. The FEACC Annual performance reports displayed that the risk of Fraud and Corruption is high in the sector. Based on FEACC data, in the last three years, 40-60% of the tip- offs received were on land and procurement thematic areas. According to Ethiopia Second Corruption Perception household survey, the customs service is the most corrupt sector, followed by land allocation, national housing, judges and the court system, and the tax system.4 The value of urban land creates a significant opportunity for petty or grand corruption on the part of those with the legal authority to assign, revoke, or restrict rights to it. On the other hand, it is observed that corruption risk in rural water supply and distribution generally low. The assessment identified more misconduct of suppliers and a few procurement complaints, including disposal complaints in the sector. OFAG audit finding reports (2016/17) to the parliament indicated high risk is in procurement and construction works in the sector. 52. The Fraud and Corruption prevention control and complaint handling system has gaps that hinder to function effectively. The assessment highlighted limitations in the areas of tracking /mapping, and reporting of F &C, staffing of Ethics and Anticorruption Officer, recording, organizing, and reporting capacities; information sharing, transparency and people’s participation; and the capacity building. Based on the assessment findings, the key challenges/risks for effective system of complaint handling which particularly lead to Fraud & Corruption, maladministration and the proposed mitigation measures are the following: • Reporting of F &C and complaints: It was not possible to map out F & C risks and track allegations, complaints for the MoA as a whole. The horizontal and vertical relationships or links of the Ministry’s Ethics and Anticorruption Directorates with counterparts in 11 accountable agencies, 3 centers, and 5 ATVET colleges is loose. Each Ethics and Anticorruption directorate in the Ministry and agencies accountable to the Ministry prepare and provides report to FEACC by its own as per the regulation. Here it is recommended to strengthen the platform for joint forums of ethics and anticorruption officers in the sector that facilitate the preparation of consolidated sectoral biannual reports and information sharing, which also assist in generating consolidated F & C report. This in turn, would help MoANR to provide quality and timely biannual report on Fraud and Corruption related offences, complaints and actions to FEAAC in line with ACGs that outline the MOU signed between the Government of Ethiopia and the bank for sharing information on F& C allegation, investigation of F& C, sharing of debarment list of firms and individuals. • Tracking, recording, organizing and reporting of F & C incidents and complaints for effective complaint management: There are two major challenges of capacity i.e. (a) Weak recording and reporting capacities of EACs and public complaint handling units at all levels; and (b) low level of effectiveness of EACs as well legal support and appeal follow up unit 4 Ethiopia Second Corruption Perception household survey commissioned by the FEACC,2012 24 experts (RLAU). FEACC/ REACCs have recognized the limitation in staff capacity as was reflected by the lack of Fraud and Corruption records that match what has been discussed orally. Effective complaint handling system is expressed by the availability and quality of records and database. Its absence hinders the disclosure, transparency and accountability to combat F & C. The functions of tracking, monitoring F & C as well as future planning and research in this area has to be informed by reliable and organized data. The proposed mitigation measure is to build strengthen the capacity of recording, organizing and reporting in the sector as well as creating awareness on procurement procedures; on F & C risk prone areas and complaints in land administration and use, agriculture research; and on investigation and research tasks. The proposed combined areas of training for Ethics and Anticorruption Officers and public complaint handling experts and experts of Legal Support, Appeal and Follow up unit are: (i) M & E, systematic tracking, recording, organizing and reporting of F & C incidents and complaints in the institutions. (ii) Procurement procedures (iii) land administration and use, agriculture research, F & C risk prone areas and complaint, and strategies or anticorruption reforms for culminating corruption in the agriculture and natural resource development sector, investigation and research tasks. • Transparency and Information sharing: There is Low level of Transparency and People’s Participation; the system of information communication to the public and among Woreda offices/ Officers is weak. In relation, all offices should be aware of and be responsible to disclose information as has been used in the Financial Transparency and Accountability (FTA). Such information sharing, and communication should include disclosing the procedure of complaint handling to the public, disclosing procurement undertakings and procurement complaints, audit findings, budgets and expenditures, particularly as it stands for the operation of the CALM PforR. It will be therefore advisable to provide capacity-building support on the principle transparency, accountability / FTAs and real people’s participation in planning, and monitoring and evaluation activities. Furthermore, it will be necessary to promote the skills of woreda level natural resources officers on CBWSM. 3.4 Auditing 53. Financial audit: The Office of Federal Auditor General (OFAG) is responsible for the financial and performance audit of the federal BIs while Office of Regional Auditor General (ORAGs) operating in 9 regions and 2 City Administrations are responsible for regional bureaus and woreda finances. OFAG and ORAGs are established under proclamation which gives them legal and operational independence. OFAG as well as ORAGs follow the International Standards for Supreme Audit Institutions (ISSAIs) issued by the International Organization of Supreme Audit Institutions (INTOSAI). Both have started continuous (interim) audit reviews. Both submit and present their report to Parliament and regional councils. OFAG has reached 100% coverage and as a result each BIs in the Federal are subject to annual audit. As most of the ORAGs have not yet reached full coverage, each regional bureau and woreda finance may not be audited annually. 54. All visited entities were subject to annual financial audit. The latest report issued vary from entity to entity. Latest audit reports for the year July 7, 2018 was issued for 28% of the visited entities. 56% of the visited entities had a one-year audit backlog and 17% percent had a two-year audit backlog. A concern is the two-year audit backlog at EIAR. This should be cleared without further delay. Audit opinions given on the financial statements of the visited entities is presented in the table below with the detail attached in Annex 5. Audited entities are requested to provide action plan and status report on the rectification of the audit findings. All entities prepared the action and status reports and submitted to OFAG and ORAGs respectively. The latter review the reports during follow up audit. the proposed mitigating measures for the 25 risks are put in the program action plan an agreed timetable to address audit backlogs, ensure timely recruitment of the audit firm and systematically follow up and report back on audit report findings. Table 4: Audit opinions issued Audit Opinion % of visited entities Unmodified 6% Qualified 78% Disclaimer 6% Adverse 10% Total 100% 55. Procurement Audit: The procurement regulatory bodies carry out procurement audit in a regular basis in each of the visited subnational states and federal PPA. Except in BG subnational state that experiences a declining trend, audit coverage has shown an increasing trend over the last three years with average increase of 15%, 27% and 34% for 2008EFY,2009EFY and 2010EFY respectively. However, in some subnational states like Oromia procurement audit was carried in a form of campaign by drawing staff from other departments and for purpose of fulfilling project commitments (ESPES DLI and ULGDP). This is not sustainable and could adversely affect the quality and credibility of the audit reports. Furthermore, the audit reports are not publicized and have limited circulation shared only between the auditee and the BoF and there is no practice in communicating the report to the wider public and regional administration. Hence, the incentive in addressing audit findings and working on the recommendations is limited. Table 5: Procurement Audit Coverage in 2008,2009, and 2010 EFY 2008 EFY 2009 EFY 2010 EFY Region # of % age # PB coverag # PB covera PB of audite e audite ge audite coverag d d d e FPPA 54 31% 77 44% 93 50% Oromia 43 12 % 113 28% 179 43% SNNPR 40 19% 50 24% 70 34% Tigray 14 7% 28 33% 32 38% BG 13 13% 8 8% 4 4% Average 15% 27% 34% 56. Arrangement for the program audit: MoF will be responsible for having the financial statements audited annually and submitting the audit report. The recurrent costs of the program which are financed through the general-purpose grant of the government are already being audited by the OFAG through continuous and annual audit under the ESPES program. A separate audit will be conducted for the SPG along with the federal level budget allocation to the MoA. Based on the agreed arrangement of the audit, the program will be audited by OFAG or an auditor to be assigned by it. Should the ESPES program close before the CALM, the OFAG will ensure that the GPG audit continues through itself or through an auditor to be assigned by it. Annual audited financial statements (for both the general and special purpose grant) of this program will be submitted to the World Bank within six months of the end of the government fiscal year. The Bank in accordance with the Access to Information policy will request for public disclosure of Audit Report. The Audit Terms of References (TORs) will be agreed during negotiation. Findings will be closely followed up and monitored at all levels. 26 3.5 Staff Capacity 3.5.1. Staffing 57. At visited entities, staff are placed as per the recent job-related reform-Job Evaluation and Grading (JEG). The following are staffing issues noted during the assessment: 58. Financial management: Staff data (allowed staff number and actually available, vacant position, education qualification) for budget, account, property management and internal audit sections has been collected and attached in Annex 4. The summary shows that the structure has been fully filled at 32% of the visited entities. At 23% of the visited entities the vacant positions for the four sections was between 20 % & 30%. Staff performance evaluation is conducted twice a year. The evaluation result is used as one criterion for future promotion, for competition for high level job etc. 59. Procurement: In MoA, the procurement unit is organized as a Directorate reporting directly to the Minster. The Directorate supervises 30 procurement experts including 18 experts employed through bank funded projects implemented in the ministry. The assessment revealed that the experts do have adequate qualification and experience in delivering procurement responsibility in the Ministry. In Oromia BoA, Benishangul Gumuz’s BoA and Bureau of Land administration procurement is organized as Procurement and Property Administration Directorate reporting to the respective bureau heads. At the time of the assessment, the Directorates were staffed with adequate number of procurement officers (3 to 5) having relevant educational background and sufficient years of experience. The procurement officers assigned in all the visited federal IA and regional Bureaus, have a minimum of BA qualification in Management, Accounting and in Procurement and Supply Chain Management. In addition, the officers received short term procurement trainings organized by the federal and respective regional procurement regulatory bodies. But the assessment noted that there are skill gaps on contract management which could be addressed through trainings as part of the annual fiduciary forum proposed in this program. 60. Fraud and Corruption: There is full staffing coverage of Ethics and Anticorruption Officers at Federal level in MoA and EIAR; and Oromiya BoA, RLAU and OARI. In Amhara except for BRLAU no EACs at BoA and AARI. Similarly, the regional offices have confirmed the availability of 17 EACs in research centers accountable to EIAR; Oromiya 17 EACs in research centers out of which 3 are focal persons; in Amhara none of the 7 research centers have EACs. On the other hand, the visited woredas in Amhara and Oromiya and the respective offices (ANRs and RLAU) did not have EAC officers. In SNNP and Benishangul Gumz at woreda level EACs represents a cluster including ANR and RLAU. Overall, in Amhara BoA and ARI; all ANR and RLAU offices at woreda levels needed to assign fulltime EAC Officers whereas the cluster representation that sideline the function of FC complaint handling needs further negotiations. Besides, the placement of EACs in the remaining 18 centers (37%) needs to be filled with fulltime EACs. The assessment besides displayed differing capacity and commitments, reported to be a consequence of the low grade/status bestowed by the civil service to the position. It will be therefore necessary to ensure the deployment of full time Ethics and Anticorruption Officers in all of the ANR and RLAU woreda offices in Amhara and Oromiya (100%), while the cluster assignment in SNNP and Benishangul Gumz needs further consideration. 3.5.2. Capacity building 61. Financial management: At federal level, the financial management capacity building is provided by MoF and found to be satisfactory. At regional level, BoFS/ZoFs are responsible for providing financial management capacity building to staff at bureau and woreda level. Although there is effort in providing the capacity building activities, it is not adequate and regular especially to woreda staffs. At some visited 27 woredas staff (including new one) have not taken training for the past two years. During the program implementation, the capacity building activity especially at woreda level should be strengthened. 62. Procurement: Procurement system strengthening activities and reforms: The GoE has carried out procurement system strengthening activities and reforms for the last many years. As a result of this effort, basic procurement systems and capacity has been established at all levels of government. Currently, the reform is focusing on modernizing the procurement system (e-GP) and improving procurement performance and efficiency. However, the procurement system has not been evaluated and measured for about a decade so as to effectively strategize the reform and system strengthening activities. Given the high share of procurement from the increasing budget of the sectors including in Agriculture sector, it is essential to ensure that procurement system strengthening effort is supported with clearly defined and documented direction, identified quick wins using evidence-based assessment. Besides, Sustainable watershed and Rural Land management can be achieved more through, inter alia, environmentally sound support functions mainly procurement. This requires uplifting the reform agenda to feature sustainability and efficiency based on best international practices. Currently, the Organization for Economic Cooperation and Development (OECD) has come up with a better tool for assessing country’s public procurement system called Methodology for Assessing Procurement System (MAPS) that has been further developed as MAPS II and successfully applied in many countries including in neighboring African countries like Uganda, Tanzania, Rwanda, Malawi etc. 63. Fraud and Corruption: The capacity of complaint handling staff (including Ethics and Anticorruption officers and experts in Legal Support, complaint handling /Appeal and Follow up unit under Rural land Administration and Use is low. The staff has different professional discipline which requires bringing on a par with others and upgrading professional skill. It will be therefore necessary to provide capacity building and training to both EACs and complaint handling officers including the Legal Support, Appeal and Follow up unit (under Rural land Administration and Use) in the areas of procurement procedures, land administration and complaint handling, investigation and research. 64. In conclusion, the capacity building endeavors of the government should be strengthened. To this effect, having an annual training organized by MoF, MoA and FEACC is recommended to ensure that staff are up to date with financial management, Procurement and fraud and corruption procedures and requirements. 4. Program systems and capacity Improvements 65. Based on the above reasons, the overall fiduciary risk assessed for this operation is classified as “substantial�. Overall, the preliminary fiduciary assessment indicates that the examined program financial management and procurement systems are adequate to provide reasonable assurance that the financing proceeds will be used for intended purposes, with due attention to principles of economy, efficiency, effectiveness, transparency and accountability, and for safeguarding Program assets once the proposed mitigation measures have been implemented. Appropriate systems to handle fiduciary risks including the fraud and corruption, including effective complaint-handling mechanisms, have been agreed on and established. Risk mitigation measures for the identified risks will be discussed and agreed with Government during project appraisal. The risk mitigation measures described in the Program Action Plan to help improve efficiency and performance monitoring. Preliminary summary of risks, mitigation measures and action plan are presented below: Table 6: Summary of Risks, Mitigation Measures Proposed Risk Description Significance PAP Mitigation Measures FINANCIAL MANAGMENT 28 Proposed Risk Description Significance PAP Mitigation Measures Planning & budgeting Inadequate allocation of operating Government will annually Substantial PAP budget at visited woredas will have allocate adequate operation impact on the achievement of budget for the agriculture program results. sector office at woreda level through the earmarked funding. Accounting and financial reporting Substantial • This • Persistent Woreda Network • The speed of challenge is a connection problem (with BoF internet connection at problem across the server) has impact in timely WoFs should be improved country which recording of transaction and needs to be producing of reports. • The LAN will be managed through • The IBEX server set up to connection the the ongoing (maintained at account section) is three sections (Budget, endeavors of the not accessed by budget, internal account and internal audit) government in audit sections and by most finance (EFY 2012 (2019/2020) enhancing IBEX officers at account section as Local through the PFM Area Network was not set up at project. most visited entities. This create a • This is to work load at the assigned finance be updated officer as task of transaction semiannually and recording is not shared among reported through accountants. Due to this the the Semiannual segregation of duties between Financial report. budget and account section is This is expected to affected. Internal auditors could not be completed in the view reports from their office. first year of implementation. Internal Control • At most visited entities, • Payroll application Substantial • Rollout of payroll is maintained and software must be payroll application processed in Excel sheets. Excel developed, installed and software is included sheets are prone to error that can be implemented. in the PAP for difficult to track. As salary • In the long run, the ESPES constitute major part of the annual implementation of IFMIS budget especially at woreda, the might mitigate this risk. payroll process should be For the medium term, supported with automation (payroll developing a property • Automating application). management recording the property • Although control software should be sought. management procedures are well incorporated in For the short term. All function must be the property management manual, implementing entities done at national 29 Proposed Risk Description Significance PAP Mitigation Measures implementation is a challenge. At should maintain manual level and is most visited entities the property records and comply with included in the PAP management is weak (no the finance regulation. for ESPES. segregation of duties between Providing regular capacity However, capacity custodianship and recording, no building will minimize the building activities use of bin card, stock card, fixed risk. and maintaining the asset register, user card. No count • Each of the required procedures of inventory at least once a year implementing entities at MoA and BoAs and reconcile with records. Tag should prepare advance is a PAP for this number is not affixed on each fixed tracking mechanisms, program asset items. There is a risk on monitor regularly and preventing and detecting misuse of present to management for • PAP inventory (both consumable and decision. fixed assets). • Nationwide, the • Significant number of internal audit function advances and payables are noted in requires a reform. However, the records of the implementing each implementing entity entities which are mostly audit should fill vacant posts, qualification points. Uncollected ensure that the program is advances will affect program included in the work plan of • Reforms implementation and payables could the auditors and provide are being addressed result in undesired penalties. training to internal auditors. by the government • At most visited entities, the through the PFM internal audit function has limited strategy. The capacity in terms of number and staffing level of the experience which resulted in low internal audit unit coverage. This has impact in at MoA and BoAs providing regular review of the will be reported internal control system in the sector through the quarterly financial reports of the program. External Audit • Two years external audit • The 2 years backlog was noted at EIAR. backlog will be cleared. • Audit report findings need Effort will be made to to be addressed timely. Audit timely conduct external findings repeat themselves year audit and issue reports for High PAP after year if close follow up is not subsequent years made. The audit reports of most of • Prepare timely the implementing entities is action plan and ensure each qualified, adverse or disclaimer. finding is addressed Transparency The Bank’s access Information is not displayed to the Disclose annual audit to information public on audited financial reports on websites of the Moderate policy requires that statements MoA and BoAs audit reports are disclosed to the 30 Proposed Risk Description Significance PAP Mitigation Measures public. The audit will be disclosed by the Bank. furthermore, disclosure by the government itself will be followed up during implementation. PROCURMENT Procurement System/Capacity • Sector specific • Revise the pool procurement at local level handled manual and adequately by actors without procurement cover how to handle sector mandate, structure and capacity specific procurements and could lead to ineffective resource roll out to regions and utilization and wastage woredas High • Local level procurement is not supported by simplified • Update the procurement directive and simplified procurement templates leading to inconsistent directive and rollout to procurement implementation. regions and woredas. High • Independent Procurement complaint handling body is not consistently established in all • Establish High regions and woredas undermining Independent procurement the complaint handling system Complaint Handling Body • The Procurement where it doesn’t exist. High performance of the federal PAP implementing agencies (MoA and • Implement EIAR) is unknown. procurement KPIs in the MoA and EIAR and report procurement performance • Inadequate procurement periodically. Details of Substantial audit could lead to leakage of the KPIs provided in Annex 8 program resource. • Undertake • The program’s long-term procurement audit in all objective of achieving sustainable IAs of the program High watershed and land management including at least 20% of system cannot be achieved in the the woredas in the targeted absence of strong procurement regional annually. system that features sustainable • Implement practices. Through independent Methodology for Assessing assessment, the strength and Procurement System High weakness of the system will be (MAPS II) and sector identified, and action plan will be specific assessment in developed to ensure VFM in Agriculture. Prepare action plan to address gaps. 31 Proposed Risk Description Significance PAP Mitigation Measures procurement practice including addressing sustainability aspects Procurement capacity There are capacity limitations in Provide intensive Substantial PAP terms of skilled staff to handle procurement and contracts procurement and contract management training to administration (incomplete staff of the program procurement plans, bidding implementing units documents, bid evaluations and poor contract management system). The provision of procurement training to the staffs seem to be inadequate, and even there are cases where procurement staff have not been exposed to any training. FRAUD & CORRUPTION AND COMPLIANT HANDLING MECHANISM Legal Framework and structural arrangement Supporting the platform for • The structure for control joint forums of ethics and F&C at the implementing anticorruption officers for institutions requires strengthening preparation of consolidated • It was not possible to map biannual reports in the out F & C risks and track sector and information PAP allegations, complaints for the sharing, for improving Medium (MOA and MoA as a whole. The horizontal supervision and data compilation activities FEACC) and vertical relationships or links of the Ministry’s Ethics and Anticorruption Directorates with counterparts in 11 accountable agencies, 3 centers, and 5 ATVET colleges is loose) Major Program implementing Assigning fulltime Ethics sector offices in Amhara and and Anticorruption PAP Oromiya specifically at woredas Officers at Woreda level at Medium (WoA and lack Ethics and anticorruption least in Agriculture and WoLAU) Officers RLAU Offices Recording /Reporting/ data and information sharing: Weak recording and reporting Training of Ethics and capacities of Ethics and Anticorruption Officers anticorruption, public complaint and complaint handling PAP Medium handling units at all levels; and low experts on (FEACC/REACC) level of effectiveness of Ethics and (i) recording, organizing Anticorruption Officers as well as and reporting / M & E 32 Proposed Risk Description Significance PAP Mitigation Measures experts in Legal Support and (ii) create awareness on Appeal Follow up unit (RLAU procurement procedures, on F & C risk prone areas and complaints in land administration and use, agriculture research, strategies or anticorruption reforms for culminating corruption in the agriculture and natural resource development sector; and on investigation and research tasks 33 Summary of Program Action Plan Action Description Source DLI# Responsibility Timing Completion Measurement Financial Management and Fraud & Corruption Internal Control and systems FSA NA (i) – (ii) MoA/BoA/EIAR (i) All entities meet requirements by (i) Improve Property management by end of Year 1 (2019/20), conducting physical property count (iii) – MoF, PPA and (ii) Actions is taken by end of Year 1 annually, reconciling with records and MoA (2019/20) on all outstanding balances reporting to management; aged more than two years; Starting (ii) Improve long outstanding (iv) MoA from Year 2 (2020/21), no outstanding receivable and payable balances by balances aged more than a year establishing a taskforce that develops (iii) MAPS II report finalized including and monitors aging analysis and reports action plan for further reform and quarterly to management for action system improvement (iii) Implement Methodology for (iv) Procurement performance Assessing Procurement System (MAPS measured using PPA’s procurement II) and sector specific assessment in KPIs and reported annually starting Dec Agriculture and prepare action plan to 2021 address gaps (iv) Implement procurement KPIs in the MoA and EIAR and report procurement performance periodically Manual and Directives PPA, MoF, BoF and WoF December All WoFEDs receive and start (i) Revise the pool manual and 2020 implementation of the revised manual adequately cover how to handle sector and the simplified directive. specific procurements and rollout to regions and woredas and (ii) Update the simplified procurement directive and rollout to regions and woredas 34 Staffing and capacity building (i) MoF, MoA and (i) (i) Annual trainings and consultations (i) Conduct annual fiduciary training FEACC annually conducted and consultation on FM, procurement (ii) MoA, FEACC and (ii) (ii) Number of staffs assigned reported and F&C. REACO regular on progress reports ii) Assign Ethics and Anticorruption Officers at woreda level at least in Agriculture and RLAU offices Audit and Complaints (i) EIAR (i) – (iii) (i) up to date audit of EIAR (i) EIAR to finalize the backlog audit; (ii) MoA and BoAs Annually (ii) Audited financial statements of (ii) Improve the financial statement (iii) PPA and MoA and BoAs without disclaimer and ‘Disclaimer’ and ‘adverse’ audit Procurement Regulatory (iv) – adverse audit opinions starting from opinions of MoA and BoAs Bodies in regions June 2020 Year 2. (iii) Undertake procurement audit in all (iv) MoF, BoFs and (iii) Procurement audit report shared IAs of the program including at least WoFs where independent annually starting year 2 (June 2021) 20% of the woredas in the targeted procurement complaint (iv) Independent procurement regions handling body is not yet complaint handling body established in (iv)Establish Independent procurement established all implementing regions and WoFEDs Complaint Handling Body in all regions and woredas where it doesn’t exist 35 5. Implementation support 65. Reviewing Implementation Progress: The Bank fiduciary team will review the implementation progress of the program in the following areas. The objective is to understand is to monitor the achievement of agreed actions and review the continuing adequacy of systems as well as to monitor risks, covenants and mitigation measures. This can be achieved through review of reports; conducting field visits and participating in semiannual missions. 66. Monitoring Fiduciary Risk: The frequency and breadth of fiduciary systems implementation support may be varied in accordance with changes in the risks to the Program. Given the risk profile shown above this program will be reviewed twice through the semiannual JRIS. 36 Annexes Annex 1: PEFA rating for Ethiopia (2014) 1. The PEFA indicators had improved in the 2014 PEFA as compared to previous year (2010) assessment and placing Ethiopia as one of the most robust PFM systems in Africa. Since 2014, no updated PEFA was conducted. The 2014 PEFA assessment for the Federal Government notes the major improvements that have been made. The report reveals that Ethiopia has significantly improved its performance on PFM. Expenditure deviation was less than 5% p.a. over during EFY 2003-2005, compared to 11.6% during EFY 1999 to 2001 and actual revenue collection ranges at 94% to 112% of the budget, during the last three years. Bills are cleared on time and arrears is not a major issue. The internal control system is comprehensive, widely understood and effective at the Federal Government level. Audit coverage at the Federal level has increased in recent years from 56% to 100% of budgetary institutions and audit reports are produced in a timely manner. The main areas where the Federal government needs to improve its performance relates to legislative scrutiny of audit reports, oversight of fiscal risk from public sector entities, public access to key fiscal information effectiveness in collection of tax payments, predictability of funds for commitment of funds and quality of in year budget execution reports. 2. According to this assessment, Ethiopia’s performance at the Federal level as per the main dimensions of PFM are the following: • Credibility of the budget – The degree of budget credibility varies between the regional governments assessed. Aside from variance in the composition of the budget, credibility generally remains good (with the exception of AACG), supported by continuing robust budget execution and internal control. Strengthened transparency and comprehensiveness would help to strengthen credibility. Key issues to reflect are: variance in composition of the budget which are attributed to the mid-year adjusted budget, domestic resource projections, and the operating modalities of the MDG Fund leading to expenditure deviations. On Revenue performance, there is generally good performance here as the bulk of regional governments’ financial resources derive from the highly predictable block grants from MoFEC. Generally, performance has also been good in Arrears performance reflecting the culture of compliance with expenditure control rules in Ethiopia. . • Comprehensiveness and transparency - Transparency and comprehensiveness have strengthened since the 2010 assessment, but some shortfalls remain, particularly under Budget documentation (PI 6), Reporting on extra-budgetary operations (PI-7), Fiscal oversight of public entities (PI-9), and Access by public to fiscal information (PI-10). The budget documentation generally (with the exception of FGoE and AACG) continues to omit information on macro-fiscal assumptions underpinning the budget, budget performance in the previous year and to date in the current year, and the fiscal impact of new expenditure and revenue measures. In regard to Extra-budgetary operation, their budget has not been reflected in the budget submitted to legislatures. While domestic EBOs performance is generally good, the external EBOs’ performance remain low (except for GoE), mainly indicating lack of information on externally-funded Programs/programs being funded through Channel 2 and being funded through Channel 3. Performance on Fiscal oversight of public entities is largely unchanged where these bodies submit in-year and end-year 37 financial performance reports and audited financial statements to their parent ministries/bureaus, but the preparation of consolidated fiscal risk reports are not yet prepared. Access by the public to fiscal information has improved but not for all Regions. Internet connectivity issues that have surfaced since the 2010 assessment have held back progress, but these are a national issue and entirely out of the control of regional governments. Implementation of the Financial Transparency and Accountability Program (FTAP), which started in 2009 and still is on-going, has done much to strengthen transparency. • Policy based budgeting - There still continues to be robust annual budget preparation systems in most places, BoFEDs and sector bureaus in the other regions met by the assessment team all seemed to have no issues concerning the annual budget preparation process. A medium-term perspective to budgeting aligned to GTP is being established at regions but rather slowly though primarily due to capacity constraints. MoF is leading the process, mainly through the establishment of a program budgeting framework as an integral part of the MTEF. It is now being piloted in SNNPRG, which ironically is where capacity constraints are very demanding. • Revenue Administration: Revenue administration performance is still generally good and has strengthened, thereby providing additional financing for the provision of public services. The main improvement since the 2010 assessment has been under taxpayer education. Also, performance is strengthening on registration system controls due to the rolling out of the biometric finger printing system; the roll out of electronic cash register systems-linked central treasury accounts; the beneficial impact of the strengthened taxpayer educations; and the periodic surveys. The tax audit function is gradually strengthening with increasing focus being placed on risk assessment as the basis for auditee selection, but capacity constraints have limited this pace. In regard to the effectiveness of tax collection, the system for monitoring tax debts has greatly improved through its incorporation into automate direct taxes software system (SIGTAS) and the improvement of manual taxpayer ledgers, have strengthened compliance, particularly through the newly established community block management system. However, there still remains to be lack of computerized tax debt recording systems. A rigorous and timely reconciliation exercise is needed to ensure that revenues reaching the central treasury accounts match original assessments, taking into account outstanding tax debts. The manual taxpayer ledgers that have been developed enable reconciliation of tax collections with tax assessments but the vast number of taxpayers, different locations, and the number of tax types renders timely reconciliation quite a difficult task. This requires system- based aggregation of reconciliation. • Budget execution and cash and Debt Management: Budget execution systems appear to continue to work well, with BIs generally obtaining the financial resources needed on time to execute their approved budgets. Cash flow forecasting continues to enable the preparation of cash plans that indicate to BoFEDs the monthly financial resources that BIs require in order to execute their budgets. On the basis of the cash flow forecasts, the BoFEDs then provide BIs with monthly expenditure limits within a quarterly framework, thus providing limits on commitments that can be made that would generate payments within each month within the quarter. BIs can commit expenditures with a longer time horizon – up to the end of the year – the financial resources needed to make payments as indicated in their cash flow forecasts. Therefore, over the short term, BIs are confident that the resources will be available to make payments and can plan and make commitments over a longer time horizon. But improvement is needed on the number and transparency of in-year adjustments to budgets made by BoFEDs. Debt management applies only to GoE and AACG which indicates improved timeliness of reporting and reconciliation and improved coverage of debt records. GoE is awaiting the approval of new guidelines under the Medium-Term Debt Strategy. 38 • Internal Control and Internal audit – The PEFA note that robust internal control systems remain to be as key strengths of Ethiopia’s PFM systems. The payroll and non-salary control systems received the largest focus in the reform, so it is not surprising that the ratings continue to be strong. A higher rating for payroll controls would be possible if an electronic linkage was created between Human Resource Departments and Financial Administration Departments in BIs. Strengthening of internal audit systems tends to lag behind other PFM reforms and it is believed that the reform on internal audit functions has proceeded at a slower pace than expected since the 2010 assessment due to severe capacity constraints. Inter-agency follow-up units were also established in 2012/13, too late to have much impact in terms of scoring, but they may have a positive impact in the medium term. Capacity constraints are probably the biggest factor impeding progress in implementing PFM reforms, which require skilled and experienced managerial and human resource capacity. • Accounting and reporting - Accounting and reporting systems were already well developed at the time of the 2010 assessment and continues to be in the current assessments. The main remaining challenges were: The provision of electronic linkages between the IBEX systems in BoFEDs and those in sector bureaus, where IBEX was being established on a stand-alone basis. This hasn’t happened to the extent expected, mainly because of the internet connectivity problems all over the country. Performance has worsened in some regions due in part to delays in clearing suspense accounts and advances which has hampered improved scores on “in-year� reporting as well as on annual financial statements. Incorporating commitment reporting into in-year budget performance reports is still an area of challenge and commitments are still not being reported, though the systems are in place to generate in the information. In regard to incorporating reporting on/accounting for DP-financed Programs into IBEX, the main issue was that the budget classification codes were not the same. Slow progress was made in addressing the omission from IBEX - on Channel 1b expenditures. The coverage and timeliness of preparation of the annual financial statements has improvement. In addition, progress has been made in developing the data systems necessary for preparing reports on resources being provided to primary service unit with varied performance across regions. Capacity constraints caused by high staff turnover rates are a major issue for accounting and reporting as for the other areas of PFM which is a nation-wide issue. • External audit - The external scrutiny systems had strengthened to some extent by the time of the 2010 assessments. Further strengthening has taken place since, but perhaps by not as much as expected and some weakening has even occurred, particularly in the external audit function, partly due to capacity constraints. External audit has not developed as much as was expected due to capacity constraints and, to some extent, insufficient support from managers of BIs. Only GoE and TRG’s improved its score, due to improved coverage and follow up resulting from in creased funding that enabled increased capacity. Others are at a lower rate in terms of coverage and timeliness in issuing reports. Some regions are not doing well in follow up as well. Legislative scrutiny of draft budgets has strengthened to an extent due to the MEFF being reviewed by the relevant legislative committee at the beginning of the budget cycle and the strengthening of procedures for review of the draft budget. Effective review under is still constrained in most regions though as the legislatures receive the draft budget documentation only at the final stage of the budget cycle at which point it is too late for review to have a meaningful impact. Legislative scrutiny of audit reports has improved in terms of strengthening the depth of hearing on audit reports and on monitoring the implementation of recommendations of the legislature based on its review of audit reports. However, the HPR and AA City Council have not issued their own recommendations but instead instruct BIs to implementation the recommendations of OFAC and CAG. 66. The overall assessment of the impact of the PFM assessment from the 2014 PEFA can be summarized in three areas: 39 • Aggregate fiscal discipline: - Fiscal discipline is generally strong, except in the case of AACG which over-forecasts domestic revenue, leading to sizeable expenditure cutbacks. This is good in terms of preventing expenditure arrears but maintaining fiscal discipline without having to cut expenditures would be a much better situation. The main risks to fiscal discipline are fiscal risks posed by state-owned enterprises and woreda governments. The risks tend to be higher at GoE level, as it owns a much larger number of enterprises and it is noted that there is inadequate monitoring of fiscal risk systematically. Fiscal risk is also present at regional government level, but the much smaller number of companies makes it easier to monitor their financial health. • Strategic allocation of resources: This is generally strong, but lack of transparency limits the availability of information on government performance and on how fiscal risks are being addressed. Two particular areas of risk are with regard to public enterprises and extra-budgetary funds, which are left out of the fiscal picture. In addition, regional governments provide quarterly reports to the center, but many of these are delayed. This in turn delays the consolidation of the general government accounts and the appraisal of overall performance. In addition, a medium-term perspective on budgeting is still not in place in regional government. Without such a perspective, based on strategic sector plans and forward spending, it is difficult to know the extent which government spending is consistent with policy objectives and strategic priorities. Another issue is the extent of unreported extra-budgetary operations, both domestic and external, particularly the latter. The sectoral spending allocation of EBOs may not be consistent with government strategic objectives and priorities. Governments can tackle this issue by making sure that planned and actual allocation of EBO funds are fully budgeted for and actual spending is fully captured in budget execution reports; • Efficient service delivery: Efficiency will depend on the in-year predictability of the budget in terms of BIs knowing that funds will be available on time to pay bills. This has generally been the case. Efficiency also depends on internal control systems working well. This has generally been the case in terms of payroll control, commitment control and through compliance with internal control rules. In recent years the procurement system has been working more effectively in terms of achieving value for money; open competition has become the norm for procurement. Streamlining of processes through implementation of BPR recommendations is also increasing efficiency (e.g. for payments procedures). 40 PI GoE AACG ARG ORG SNNPRG TRG SRG PI-1 Aggregate expenditure performance A D B B B B B PI-2 Variance in expenditure composition B+ D+ B+ D+ D+ C+ PI-3 Aggregate revenue performance B D C D D A B PI-4 Expenditure payment arrears A B+ B B B+ B+ B+ PI-5 Budget classification B B B B B B B PI-6 Budget documentation B B D D D C C PI-7 Un-reported EBOs B+ C+ D+ D+ D+ D+ D+ PI-8 Inter-governmental fiscal relations B+ A A B+ A A A PI-9 Fiscal risk C C+ C+ C+ A A A PI-10 Public access to key fiscal information C A B B C B C PI-11 Budget preparation A B+ A B A A PI-12 Medium term perspective in budgeting B B D+ B D+ D+ D+ PI-13 Transparency A A A A A A B+ PI-14 Effectiveness of taxpayer registration B B B B+ B B B PI-15 Tax Collections C+ D+ D+ D+ D+ D+ D+ PI-16 In-year predictability of budget execution C+ C+ C+ C+ A C+ A PI-17 Cash & debt management systems B A B+ C+ B+ B+ B PI-18 Payroll control B+ B+ B+ B+ B C+ C+ PI-19 Procurement B+ B D+ C C+ B C+ PI-20 Non-salary internal control B B↑ B B B B B PI-21 Internal audit B+ C+ B+ C+ C+ B+ B PI-22 Accounts reconciliation A B B B B B B PI-23 Resources received by service delivery units NA A B B C C C PI-24 Quality of in-year budget reports C+ C+ C+ C+ C+ C+ C+ PI-25 Annual financial statements C+ C+ C+ C+ C+ C+ C+ PI-26 External Audit B+ D+ C+ C+ D+ B+ C+ PI-27 Legis-lative oversight:Budget B+ D+ C+ B+ C+ D+ C+ PI-28 Legis-lative oversight: audit reports. D+ D+ A B+ A B+ B+ 41 PEFA score for Ethiopia-2014 4.00 3.50 3.00 2.50 PEFA Score 2.00 1.50 1.00 0.50 0.00 Comprehen Predictabili Accounting Credibility siveness Policy- ty & External , Recording of the and Based Control in Scrutiny and budget Transparen Budgeting Budget and Audit Reporting cy Execution Federal 3.63 2.58 3.50 2.94 3.00 2.83 AACG 1.75 3.17 3.25 3.00 3.00 1.50 Amhara 2.50 2.50 2.75 2.89 2.75 3.00 Oromia 2.75 2.42 1.50 2.72 2.75 3.17 SNNPRG 2.25 2.58 2.75 3.06 2.38 2.67 Tigray 3.00 2.92 2.75 2.89 2.75 2.83 Somali 3.00 2.75 2.75 2.89 2.50 2.83 Average (2014) 2.70 2.70 2.75 2.91 2.73 2.69 Average (2010) 1.64 1.89 1.86 2.38 2.43 1.67 42 43 44 Annex 2: Continuous audit report findings data for three quarters of EFY 2010 OUTSTANDING ISSUES EFY 2010 – Quarter 1 Regions Amh Oromia Afar Eth.Somali B/S SNNPRS Gambela Tigray Harari D/D Total Asset Management 19 19 17 7 1 3 4 70 Bank & Cash 5 5 14 6 1 31 Receivable & Payable 16 12 7 5 1 3 44 Expenditure 2 2 30 5 2 41 Financial Report 0 Inventory Mgt 1 2 3 1 1 8 Partially Rectified Total 43 40 0 71 0 24 5 6 0 5 194 Fully Rectified Not fully Rectified 17 71 6 94 Total Follow up Issues 43 17 0 0 0 71 0 0 0 6 288 EFY 2010 – Quarter 2 Regions Amh Oromia Afar Eth.Somali B/S SNNPRS Gambela Tigray Harari D/D Total Asset Management 17 8 - 19 5 9 58 Bank & Cash 5 4 - 7 1 13 30 Receivable & Payable 12 9 2 2 15 40 Expenditure 5 1 8 1 4 19 Financial Report - Inventory Mgt 39 3 3 6 Partially Rectified Total 25 39 9 41 153 Fully Rectified 7 37 44 Not fully Rectified 2 55 57 Total Follow up Issues 39 34 39 9 133 254 45 FY 2010 – Quarter 3 Oromi Eth.Somal SNNPR Gambel Tigra Harar Tota Regions Amh a Afar i B/S S a y i D/D l Asset Management 11 11 4 Bank & Cash 2 5 2 Receivable & Payable 4 5 2 2 Expenditure 2 5 1 Financial Report Inventory Mgt 1 3 Partially Rectified Total Fully Rectified Not fully Rectified 1 15 54 Total Follow up Issues 19 28 27 56 Annex 3: Budget/Spending numbers/trend Ethiopia Institute of Agricultural Research Budget vs. Expenditure (, 000,000) Birr 2008 2009 2010 46 Budget Expenditu Perf. Budget Expenditu Perf. Budge Expenditu Perf. re re t re Recurre 228.25 212.32 93% 276.55 260.74 94% 802.2 753.35 94% nt 7 Capital 286.30 289.12 101 323.74 333.02 103 - - % % Total 514.55 501.44 97% 600.28 593.76 99% 802.2 753.35 94% 7 Ministry of Agriculture Budget vs. Expenditure (, 000,000) Birr Agricultural Extension Advisory & Training Directorate 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture % ure ure Recurre 36.61 nt 30.97 84.59 3.8 3.2 84.21 7.89 7.48 94.80 Capital 3.57 2.72 76.19 275.7 275.7 100.00 279.77 279.77 100.00 Total 40.18 33.69 83.85 279.5 278.9 99.79 287.66 287.25 99.86 Agricultural Technical & Vocational Training 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture ure ure Recurre nt - - - - - - 350.31 302.46 86.34 Capital 316.71 256.81 81.09 370.66 359.05 96.87 - - - Total 316.71 256.81 81.09 370.66 359.05 96.87 350.31 302.46 86.34 Natural Resource Development & Protection Directorate 2008 2009 2010 47 Budget Expend Perf. Budget Expendit Perf. Budget Expendit Perf. iture ure ure Recurre nt 7.76 6.2 79.90 14.46 14.08 97.37 15.56 14.91 95.82 Capital 110.4 77.05 85.06 0 49.46 47.53 96.10 27.65 23.75 85.90 Total 107.6 84.81 91.26 1 63.92 61.61 96.39 43.21 38.66 89.47 Rural Land Administration & Utilization Management 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 2.5 1.45 58.00 2.53 2.11 83.40 1.79 1.53 85.47 Capital 4.83 0.42 8.70 2.69 0.17 6.32 - - - Total 7.33 1.87 25.51 5.22 2.28 43.68 1.79 1.53 85.47 ATVETI Coordination Office (Including the Colleges) 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre - - - - - - nt 350.26 302.46 86.35 Capital 313.66 256.81 81.87 366.55 359.05 97.95 49.37 18.81 38.10 Total 313.66 256.81 81.87 366.55 359.05 97.95 399.63 321.27 80.39 Alagie ATVETI 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure 48 Recurre nt - - - - - - 120.89 109.94 90.94 Capital 99.60 81.17 81.50 115.75 101.78 87.93 - - - Total 99.60 81.17 81.50 115.75 101.78 87.93 120.89 109.94 90.94 49 SNNPR Budget vs. Expenditure at Regional and Woreda Level (‘000,000) Birr 2008 2009 2010 Bureau Woreda Total Bureau Woreda Total Bureau Woreda Total Office Recurrent Budget 79.84 982.06 1,061.90 97.38 931.66 1,029.04 96.22 1,062.53 1,158.75 of Agr. Recurrent Actual 72.43 963.45 1,035.88 94.92 915.95 1,010.88 91.82 1,044.98 1,136.79 Perf. 91% 98% 98% 97% 98% 98% 95% 98% 98% Capital Budget 134.79 97.78 232.57 146.90 95.15 242.05 160.36 98.34 258.70 Capital Actual 113.99 75.31 189.30 126.85 75.55 202.40 152.59 80.32 232.91 Perf. 85% 77% 81% 86% 79% 84% 95% 82% 90% Total Budget 214.62 1,079.85 1,294.47 244.28 1,026.81 1,271.09 256.58 1,160.88 1,417.46 Total Actual 186.43 1,038.75 1,225.18 221.78 991.50 1,213.28 244.40 1,125.30 1,369.70 Perf. 87% 96% 95% 91% 97% 95% 95% 97% 97% RARI Recurrent Budget 39.70 - 39.70 56.29 - 56.29 66.20 - 66.20 Recurrent Actual 38.69 - 38.69 55.82 - 55.82 63.26 - 63.26 Perf. 97% 97% 99% - 99% 96% 96% Capital Budget 37.94 - 37.94 64.03 - 64.03 43.15 - 43.15 Capital Actual 36.74 - 36.74 30.53 - 30.53 36.53 - 36.53 Perf. 97% 97% 48% 48% 48% 48% Total Budget 77.65 - 77.65 120.32 - 120.32 109.35 - 109.35 Total Actual 75.42 - 75.42 86.35 - 86.35 99.79 - 99.79 Perf. 97% 97% 72% 72% 91% 91% Office Recurrent Budget 6.17 - 6.17 7.61 - 7.61 8.89 - 8.89 of Land Adm. Recurrent Actual 5.79 - 5.79 7.25 - 7.25 8.01 - 8.01 Perf. 94% - 94% 95% - 95% 90% 50 Capital Budget 3.02 - 3.02 3.15 - 3.15 3.54 - 3.54 Capital Actual 2.36 - 2.36 2.11 - 2.11 2.12 - 2.12 Perf. 78% - 78% 67% - 67% 60% 60% Total Budget 9.19 - 9.19 10.76 - 10.76 12.43 - 12.43 Total Actual 8.15 - 8.15 9.36 - 9.36 10.12 - 10.12 Perf. 89% 89% 87% 87% 81% 81% Benshangul Gumuz Region Budget vs. Expenditure at Regional and Woreda Level (‘000,000) Birr 2008 2009 2010 Bureau Woreda Total Bureau Woreda Total Bureau Woreda Total Office of Agric. Recurrent Budget 47.97 120.07 168.04 67.63 159.78 227.42 86.26 204.16 290.42 Recurrent Actual 45.95 119.19 165.14 59.27 155.40 214.68 79.53 197.69 277.22 Perf. 96% 99% 98% 88% 97% 94% 92% 97% 95% Capital Budget 63.04 2.35 65.40 76.09 9.63 85.73 42.79 24.48 67.26 Capital Actual 42.23 2.29 44.51 49.45 5.33 54.77 33.88 14.98 48.86 Perf. 67% 97% 68% 65% 55% 64% 79% 61% 73% Total Budget 111.01 122.43 233.44 143.73 169.42 313.14 129.05 228.64 357.68 Total Actual 88.18 121.47 209.65 108.72 160.73 269.45 113.41 212.67 326.08 Perf. 79% 99% 90% 76% 95% 86% 88% 93% 91% Office of Land Recurrent Budget 9.70 9.18 18.88 12.55 14.38 26.93 15.93 23.18 39.11 Adm. Recurrent Actual 9.44 9.09 18.53 11.82 13.72 25.54 15.87 22.26 38.13 Perf. 97% 99% 98% 94% 95% 95% 100% 96% 97% Capital Budget 5.21 0.00 5.21 6.20 0.08 6.28 6.00 0.00 6.00 Capital Actual 5.11 0.00 5.11 6.14 0.06 6.20 5.12 0.00 5.12 Perf. 98% - 98% 99% 66% 99% 85% - 85% Total Budget 14.91 9.18 24.09 18.75 14.46 33.22 21.93 23.18 45.11 Total Actual 14.55 9.09 23.64 17.96 13.77 31.74 20.98 22.26 43.24 Perf. 98% 99% 98% 96% 95% 96% 96% 96% 96% 51 Budget vs. Expenditure of visited woredas (, 0000, 000) Birr SNNP-East Badawacho woreda Agriculture and Rural Development 2008 2009 2010 Budget Actual Perf. Budget Actual Perf. Budget Actual Perf. Recurrent 9.92 9.74 98% 9.46 9.46 100% 11.87 10.53 89% Capital - - - - - - - - - Total 9.92 9.74 98% 9.46 9.46 100% 11.87 10.53 89% SNNPR-wondoGenete woreda Agriculture and Rural Development 2008 2009 2010 Budget Actual Perf. Budget Actual Perf. Budget Actual Perf. Recurrent 5.22 5.22 100% 5.01 5.01 100% 6.13 6.13 100% Capital - - - 5.55 - - - - 5.22 5.22 100% 10.56 5.01 47% 6.13 6.13 100% Benshangul G- Bambassi woreda Agriculture & Rural Development 2008 2009 2010 Budget Actual Perf. Budget Actual Perf. Budget Actual Perf. Recurrent 8.79 8.80 100% 12.05 11.48 95% 15.02 14.22 95% Capital - - - 0.21 0.08 38% 2.60 0.11 4% Total 8.79 8.80 100% 12.26 11.56 94% 17.62 14.33 81% Environmental Protection and Soil Administration 2008 2009 2010 Budget Actual Perf. Budget Actual Perf. Budget Actual Perf. Recurrent 0.44 0.45 103% 0.74 0.72 97% 1.85 1.72 93% Capital - - - - - - 52 Total 0.44 0.45 103& 0.74 0.72 97% 1.85 1.72 93% Benshangul G- Kurmuk woreda Agriculture & Rural Development 2008 2009 2010 Budget Actual Perf. Budget Actual Perf. Budget Actual Perf. Recurrent 8.79 8.80 100% 12.05 11.48 95% 15.02 14.22 95% Capital - - - 0.21 0.08 38% 2.60 0.11 4% Total 8.79 8.80 100% 12.26 11.56 94% 17.62 14.33 99% Environmental Protection and Soil Administration 2008 2009 2010 Budget Actual Perf. Budget Actual Perf. Budget Actual Perf. Recurrent 0.44 0.45 103% 0.74 0.72 97% 1.85 1.72 93% Capital - - - - - - - - Total 0.44 0.45 103% 0.74 0.72 97% 1.85 1.72 93% Amhara Budget vs. Expenditure at Regional and Woreda Level (‘000,000) Birr 2008 2009 2010 Bureau Woreda Total Bureau Woreda Total Bureau Woreda Total Office Recurrent Budget 142.16 1,046.27 1,188.44 158.04 1,016.81 1,174.86 189.50 1,189.67 1,379.17 of Agr. Recurrent Actual 139.10 1,032.05 1,171.16 157.32 1,014.51 1,171.83 186.93 1,202.09 1,389.02 Perf. 97.85 98.64 98.55 99.54 99.77 99.74 98.64 101.04 100.71 Capital Budget 242.57 89.61 332.19 360.14 103.90 464.04 249.99 116.18 366.18 Capital Actual 216.26 81.19 297.45 295.38 105.86 401.24 163.89 105.09 268.98 Perf. 89.15 90.60 89.54 82.02 101.89 86.47 65.56 90.45 73.46 Total Budget 384.74 1,135.88 1,520.62 518.18 1,120.71 1,638.89 439.49 1,305.85 1,745.35 Total Actual 355.36 1,113.25 1,468.61 452.70 1,120.37 1,573.07 350.82 1,307.18 1,658.00 Perf. 92.36 98.01 96.58 87.36 99.97 95.98 79.82 100.10 95.00 RARI Recurrent Budget 119.41 - 119.41 130.46 - 130.46 143.59 - 143.59 Recurrent Actual 105.46 - 105.46 127.13 - 127.13 137.30 - 137.30 53 Perf. 88.32 - 88.32 97.44 - 97.44 95.62 - 95.62 Capital Budget 12.54 - 12.54 26.20 - 26.20 29.69 - 29.69 Capital Actual 2.66 - 2.66 9.55 - 9.55 18.62 - 18.62 Perf. 21.24 - 21.24 36.46 - 36.46 62.71 - 62.71 Total Budget 131.94 - 131.94 156.66 - 156.66 173.28 - 173.28 Total Actual 108.12 - 108.12 136.68 - 136.68 155.92 - 155.92 Perf. 81.94 - 81.94 87.24 - 87.24 89.98 - 89.98 Office Recurrent Budget 26.01 198.35 224.36 30.26 292.59 322.86 39.42 384.61 424.04 of L. Adm. Recurrent Actual 34.61 196.50 231.10 46.24 292.70 338.94 38.92 375.59 414.52 Perf. 133.05 99.06 103.00 152.79 100.04 104.98 98.73 97.66 97.76 Capital Budget 55.27 1.71 56.98 88.66 1.53 90.18 51.58 11.96 63.55 Capital Actual 50.19 1.29 51.49 59.98 1.09 61.08 50.67 9.59 60.25 Perf. 90.82 75.66 90.36 67.66 71.46 67.72 98.23 80.20 94.81 Total Budget 81.28 200.06 281.34 118.92 294.12 413.04 91.00 396.57 487.59 Total Actual 84.80 197.79 282.59 106.22 293.80 400.02 89.59 385.19 474.77 Perf. 104.33 98.86 100.44 89.32 99.89 96.85 98.45 97.13 97.37 Oromia Budget vs. Expenditure at Regional and Woreda Level (‘000,000) Birr 2008 2009 2010 Bureau Woreda Total Bureau Woreda Total Bureau Woreda Total Office of Recurrent Budget 237.15 949.73 1,186.88 181.94 1,041.04 1,222.98 192.41 1,155.16 1,347.58 Agr. Recurrent Actual 213.71 934.33 1,148.04 169.74 1,018.14 1,187.88 180.97 1,139.60 1,320.57 Perf. 90.12 98.38 96.73 93.29 97.80 97.13 94.05 98.65 98.00 Capital Budget 136.68 165.90 302.58 81.86 100.93 182.79 85.23 56.29 141.52 Capital Actual 44.32 141.85 186.17 51.07 78.52 129.59 29.81 41.76 71.57 Perf. 32.43 85.50 61.53 62.39 77.79 70.90 34.98 74.19 50.58 Total Budget 373.82 1,115.63 1,489.45 263.80 1,141.97 1,405.77 277.64 1,211.46 1,489.10 Total Actual 258.03 1,076.18 1,334.21 220.82 1,096.66 1,317.47 210.78 1,181.37 1,392.15 Perf. 69.02 96.46 89.58 83.71 96.03 93.72 75.92 97.52 93.49 54 RARI Recurrent Budget 95.48 - 95.48 111.32 - 111.32 137.60 - 137.60 Recurrent Actual 92.75 - 92.75 105.57 - 105.57 133.14 - 133.14 Perf. 97.14 - 97.14 94.83 - 94.83 96.76 - 96.76 Capital Budget 63.22 - 63.22 72.99 - 72.99 70.54 - 70.54 Capital Actual 55.50 - 55.50 60.19 - 60.19 58.71 - 58.71 Perf. 87.79 - 87.79 82.46 - 82.46 83.23 - 83.23 Total Budget 158.70 - 158.70 184.31 - 184.31 208.14 - 208.14 Total Actual 148.25 - 148.25 165.76 - 165.76 191.85 - 191.85 Perf. 93.41 - 93.41 89.94 - 89.94 92.17 - 92.17 Office of L. Recurrent Budget 86.95 267.44 354.40 45.69 385.70 431.39 52.34 372.35 424.68 Adm. Recurrent Actual 85.59 260.39 345.98 44.30 379.05 423.35 50.06 366.72 416.79 Perf. 98.43 97.36 97.62 96.94 98.28 98.13 95.65 98.49 98.14 Capital Budget 86.12 3.81 89.93 104.41 4.63 109.04 76.36 0.79 77.15 Capital Actual 77.56 3.16 80.71 101.36 2.52 103.88 67.41 0.27 67.68 Perf. 90.06 82.83 89.75 97.08 54.38 95.27 88.27 34.61 87.73 Total Budget 173.07 271.25 444.32 150.11 390.32 540.43 128.70 373.13 501.83 Total Actual 163.15 263.54 426.69 145.66 381.57 527.22 117.47 367.00 484.46 Perf. 94.27 97.16 96.03 97.04 97.76 97.56 91.27 98.36 96.54 Budget vs. Expenditure of visited Bureaus & Woredas (, 0000, 000) Birr Amhara Bureau of Agriculture 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture ure ure Recurre nt 47.04 45.63 96.99 46.83 47.83 102.13 66.13 65.54 99.11 Capital 227.65 205.63 90.33 350.41 290.18 82.81 241.82 156.42 64.68 Total 274.69 251.26 91.47 397.24 338.01 85.09 307.95 221.96 72.08 Amhara RARI 55 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 29.63 18.26 61.64 21.29 23.55 110.64 17.62 14.97 84.96 Capital 3.50 1.72 49.27 2.60 2.40 92.22 0.50 0.04 7.80 Total 33.13 19.98 60.33 23.89 25.95 108.64 18.12 15.01 82.83 Amhara Bureau of Land Administration 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 21.95 21.45 97.73 20.64 20.60 99.81 16.50 16.07 97.39 Capital 55.27 50.19 90.82 75.03 59.44 79.22 49.87 49.14 98.55 Total 77.22 71.65 92.78 95.67 80.04 83.66 66.37 65.21 98.26 Amhara - Yilmana Densa Woreda Agriculture Office 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 9.67 9.65 99.82 9.48 9.43 99.43 11.19 11.00 98.24 Capital 0.42 0.35 83.92 0.12 0.11 90.34 0.19 0.19 99.66 Total 10.09 10.01 99.16 9.60 9.54 99.32 11.39 11.19 98.27 Amhara - Yilmana Densa Woreda Land Administration Office 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 2.13 2.11 99.27 2.99 2.96 98.92 3.79 3.74 98.64 56 Capital - - - - - - 0.27 0.27 100.00 Total 2.13 2.11 99.27 2.99 2.96 98.92 4.06 4.01 98.73 Amhara – Farta Woreda Agriculture Office 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture ure ure Recurre nt 11.72 11.72 100.00 11.03 11.03 99.99 10.89 10.89 99.99 Capital 0.45 0.36 80.15 0.14 0.14 100.00 0.36 0.36 98.16 Total 12.16 12.08 99.27 11.16 11.16 99.99 11.26 11.25 99.93 Amhara – Farta Woreda Land Administration Office 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture ure ure Recurre nt 2.56 2.56 100.00 3.76 8.17 217.35 4.04 4.04 99.93 Capital - - - - - - 0.23 0.23 99.87 Total 2.56 2.56 100.00 3.76 8.17 217.35 4.27 4.27 99.92 Oromia Bureau of Agriculture 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 107.59 96.22 89.44 99.11 91.93 92.75 96.97 90.43 93.26 Capital 58.44 30.33 51.89 66.27 40.28 60.79 82.92 28.18 33.99 Total 166.03 126.55 76.22 165.38 132.21 79.94 179.89 118.61 65.94 Oromia RARI 57 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 10.61 10.21 96.23 11.32 11.11 98.15 14.21 13.58 95.56 Capital 15.29 11.57 75.65 23.83 14.01 58.77 26.97 16.93 62.78 Total 25.90 21.78 84.08 35.15 25.11 71.45 41.18 30.51 74.09 Oromia Bureau of Land Administration 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 56.49 55.85 98.86 13.84 13.61 98.34 16.79 16.31 97.15 Capital 77.88 71.16 91.37 89.28 87.71 98.24 60.00 52.98 88.30 Total 134.37 127.01 94.52 103.12 101.32 98.25 76.79 69.29 90.23 Oromia Ejere Woreda Agriculture Office 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 4.40 4.06 92.36 4.68 4.63 98.86 5.42 5.41 99.80 Capital - - - - - - - - - Total 4.40 4.06 92.36 4.68 4.63 98.86 5.42 5.41 99.80 Oromia Ejere Woreda Land Administration Office 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture ure ure Recurre nt 1.30 1.11 85.55 1.27 1.25 98.38 1.17 1.17 99.44 58 Capital 0.48 0.48 100.00 - - - - - - Total 1.79 1.60 89.47 1.27 1.25 98.38 1.17 1.17 99.44 Oromia Aleltu Woreda Agriculture Office 2008 2009 2010 Budget Expendi Perf. Budget Expendit Perf. Budget Expendit Perf. ture ure ure Recurre nt 2.80 2.78 99.56 3.02 3.02 99.97 2.92 2.92 99.99 Capital 0.30 0.30 100.00 0.15 0.15 99.91 - - - Total 3.10 3.09 99.60 3.17 3.17 99.97 2.92 2.92 99.99 Oromia Aleltu Woreda Land Administration Office 2008 2009 2010 Budget Expendit Perf. Budget Expendit Perf. Budget Expendit Perf. ure ure ure Recurre nt 0.95 0.95 99.57 1.05 1.05 100.00 1.05 1.05 99.99 Capital - - - - - - - - - Total 0.95 0.95 99.57 1.05 1.05 100.00 1.05 1.05 99.99 59 Annex 4: Financial management Staff data structure Actual Vacant Qualification Federal- EIAR Head Office Budget 3 3 - ALL BA Account 14 14 - 10 BA,4 Diploma Internal audit 10 8 2 ALL BA Property mgt. 5 5 - 1BA,4Diploma Federal –EIAR Centers (17centers) Budget 15 15 Account 107 107 Internal audit 21 21 Property mgt. 65 65 SNNPR, BoA &LAU Budget 10 10 ALL BA Account 11 11 9 BA, 2 Diploma Internal audit 6 6 ALL BA Property mgt. 7 7 6 BA, 1Diploma SNNPR –RIAR Head Office Budget 5 5 ALL BA Account 9 9 1MA,6BA,2Diploma Internal audit 5 4 1 ALL BA Property mgt. 2 2 BA SNNPR –RIAR Centers (6) Budget 6 6 ALL BA Account 34 34 29 BA,5 Diploma Internal audit 6 5 ALL BA Property mgt. 12 12 5 BA,7 Diploma SNNPR- Misrak Badawich WoFED Budget 8 5 3 ALL BA Account 15 14 1 ALL BA 60 Internal audit 10 6 4 ALL BA Property mgt. 6 3 3 ALL BA SNNPR- WondoGenet WoFED Budget 6 4 2 1MA,3BA Account 14 9 5 ALL BA Internal audit 9 3 6 ALL BA Property mgt. 7 1 1 BA Benshangul-G-RLAU Budget 4 4 ALL BA Account 12 11 1 2 BA,9Diploma Internal audit 5 4 1 1BA,4Diploma Property mgt. 7 6 1 3BA,3Diploma Benshangul-G- BoA Budget 6 6 ALL BA Account 12 12 5BA,7Diploma Internal audit 4 4 ALL BA Property mgt. 6 6 2BA,4Diploma Benshangul-G- Bambasie WoFED Budget 7 6 1 ALL BA Account 19 18 1 8BA,10Diploma Internal audit 4 3 1 ALL BA Property mgt. 5 5 3BA,2Diploma Benshangul-G- Kumruk WoFED Budget 7 3 4 2BA,1Diploma Account 14 13 1 5BA,8Diploma Internal audit 4 2 2 1BA,1Diploma Property mgt. 5 5 ALL Diploma Federal MoA Budget Account 44 42 2 34 BA,8 Diploma Internal audit 20 10 10 10BA Property mgt. 22 22 1MA, 5BA, 16 Dip. 61 Federal ATVET coordination office Accountant 6 5 1 3BA,2Diploma Federal Alagie Agricultural TVETI Budget 4 1 3 1 BA Account 27 20 7 12 BA,8 Diploma Internal audit 5 4 1 3BA,1Diploma Property mgt. 16 10 6 2BA,8Diploma Amhara BOA Budget 9 7 2 7 BA Account 11 11 11 BA Internal audit 6 6 6BA Property mgt. 9 7 2 7BA Amhara BOLAU Budget 3 3 3BA Account 9 9 6BA,3Diploma Internal audit 3 3 3BA Property mgt. 4 4 2BA,2Diploma Amhara RARI Budget 2 2 2BA Account 7 7 6BA,1Dioplma Internal audit 3 3 Property mgt. 4 4 2BA,2Diploma Amhara RARI centers (9 center Budget 7 7 7BA Account 52 52 37BA,15Diploma Internal audit 7 7 7 Diploma Property mgt. 17 17 17 Diploma Amhara Yilmana Densa WoFED Budget 4 4 4BA Account 23 22 21BA,1Diploma 62 Internal audit 5 5 5BA Property mgt. 10 8 2 4BA,4Diploma Amhara-Farta WoFED Budget 4 4 8BA Account 23 23 16BA,7Diploma Internal audit 8 8 8BA Property mgt. 10 10 1BA,9Diploma Oromia-BoA Budget 6 5 1 5BA Account 18 17 13BA,4Diploma Internal audit 12 12 12BA Property mgt. 8 8 1BA,7Diploma Oromia BoLAU Budget 7 7 1BA,6Diploma Account 10 10 8BA,2Diploma Internal audit 4 4 4Diploma Property mgt. 2 2 2Diploma Oromia RARI Budget 6 3 3BA Account 11 10 7BA,3Diploma Internal audit 8 8 8BA Property mgt. 5 4 4Diploma Oromia Ejera WoFED Budget 7 3 4 3BA Account 18 18 18BA Internal audit 9 4 5 4BA Property mgt. 7 4 3 1BA,3Diploma Oromia-Aleltu WoFED Budget 8 7 1 7BA Account 16 15 1 12BA,3Diploma Internal audit 11 8 3 8BA Property mgt. 5 5 3BA,2Diploma 63 Annex 5: External Audit-visited implementing entities Proposed IEs External Latest audit report Date of Opinion Major qualification points audit issued issue EIAR Audit July7,2015 (EFY July Qualified -Difference of Birr 12milllion service 2007) 4,2018 (except for) between ending bank statement Corp. balance for special bank account Note: field work (July 7, 2014) and the opening for July 7, 2016 balance (July8, 2014) for the account has been same account. The latter found completed. more. No explanation -Long outstanding receivable Audit for July balance Birr 30,831,869 7,2017 &2018 has - Long outstanding account not yet been payable balance Birr 2,358,675 started SNNPR-BOA ORAG July 7,2016 (EFY May Disclaimer -Long outstanding receivable Birr 2008) 25,2018 79,654,758 -Long outstanding payable Birr -ORAG did not 143,770,175 conduct EFY 2009 -Unutilized budget Birr account 33,544,403 -audit field work -Abnormal balance of receivable has been Birr 8,792,017.22 64 completed for -Expenditure without supplier EFY 2010 account invoice (receipts) Birr and exit 13,471,121.09 conference has been conducted. The Bureau expect except for opinion SNNPR-RIAR ORAG July 7,2015 (EFY Feb Qualified Qualification points were 2007) 28,2017 (except for) insignificant such as long ORAG did not outstanding receivable Birr conduct the EFY 309,057. 2008 account 06 and long outstanding payable Audit for EFY balance Birr 142,799.58, coding 2009 & 2010 is error Birr 4,306, Not deducting under progress WHT of Birr 1,168.73 SNNPR- East ORAG July 7,2017 (EFY December Qualified -Long outstanding receivable Birr Badawacho 2009) 4,2018 (except for) 19,543,679.38 woreda -Long outstanding payable July 7,2018 balance Birr 4,890,597.51 account was -Per diem payment without audited but report supporting documents Birr18,856 was not yet issued SNNPR- Not obtained. But the assessment team noted that the EFY 2010 audit is under progress Wondo Genet woreda Benshangul G- ORAG July 7,2017 (EFY Qualified -Long outstanding receivable Birr BoA 2009) (except for) 19,543,679.3813,691,292 July 7,2018 -Long outstanding payable account was under balance Birr 5,824,569.04 audit -Improper per diem Birr 45,323.75 Unutilized budget Birr 3,199,879.63 Benshangul G ORAG July 7,2018 (EFY Feb Qualified -Unutilized budget Birr 2010) 14,2019 (except for) 1,080,008.35 65 Bureau of -Fixed asset not counted for EFY Land 2010 Administration Benshangul G ORAG July7,2017 (EFY 13/04/2018 Qualified -Long outstanding receivable Bambassi 2009) (except for) balance Birr 900,502 woreda July 7,2018 audit -Long outstanding payable was completed but balance Birr6,539,579 report was not yet issued Benshangul G ORAG July 7,2018 (EFY 15/01/2019 Adverse -Long outstanding receivable Kurmuk 2010) balance Birr 934,568.05 woreda -Inappropriate per diem payment birr 71,079.5 Payment without supplier invoice/GRN Birr 440,846.48 -Long outstanding payable balance birr1,625,011.61 Unutilized budget birr492554.79 MOA OFAG July 7,2017 (EFY Adverse -long outstanding advances (work (including 2009) and purchase advances; ATVTEs -long outstanding liabilities; -Issues or findings related to inter branch transactions; - Presence of unsupported payments; Oromia BoA ORAG July 7,2017 (EFY Qualified 2009) (except for) Oromia ORAG July 7,2017 (EFY Qualified BoLAU 2009) (except for) Oromia RIAR ORAG July 7,2017 (EFY Qualified 2009) (except for) Oromia Aleltu ORAG July 7,2017 (EFY Qualified Woreda 2009) (except for) 66 Oromia Ejere ORAG July 7,2017 (EFY Qualified Woreda 2009) (except for) Amhara-BoA ORAG Unqualified (Clean Opinion) Amhara ORAG July 7,2017 (EFY Qualified BoLAU 2009) (except for) Amhara-RIAR ORAG July 7,2018 (EFY Qualified 2010) (except for) Amhara-Farta ORAG July 7,2018 (EFY Qualified -Long outstanding advance of Woreda 2010) (except for) Birr 16.87 million -Ling outstanding liability of Birr 1 million; Uncollected penalty income of Birr 38;007.31; Under spending of Birr 1.20 million; Annex 6: Fraud and Corruption and Compliant handling Performance Table 1: F & C Prevention and Control Performances in sample region of Amhara and Oromiya No. Description Amhara Oromiya Remarks/both 1 Urgent F & C prevention activity is based on · Procurement in Land Due to irregularities the Total Birr saved and tip offs received on procurements that are Administration- reviewed /amended Procurement process for procurement under process and recommended to proceed; Road construction (Sebeta processes canceled/ town Birr 48 million) has revised been cancelled 67 No. Description Amhara Oromiya Remarks/both · Central Gonder zone, Aderkay- Birr 48 Million saved. Birr 49. 688 Million (Birr 1.109,060) a payment for the saved procurement of improved beehives (without delivering the materials) has been suspended. · Oromo zone, Chefa Robit- a Payment (Birr 579, 465) for construction works not undertaken has been replenished; · Birr 1.688 Million saved 2 Misappropriated finance recovered by EACs 74.867 74.867 in different Offices (in Million Birr) 3 Recovery of misappropriated Finance (in 8.528 8.528 Million Birr) 4 Penalty imposed & collected (in Million 0.8852 5.984593 6.869793 Birr) 5 Tip Offs by area of Focus 1545 1508 3053 • Land 270 607 877 • Procurement 165 242 407 • Tax 41 193 234 • Justice and Administration 53 101 154 • Counterfeiting and use 541 541 • Others 475 365 840 % of Tip-offs of land and procurement 28.2% 56.3% 84.5% 6 Tip-offs presented to the commission 2206 1491 3697 • Transferred (from previous year) 27 27 • New Tip Offs 2179 1491 3670 7 Tip Offs within the Commission’s 1741 836 2577 Jurisdiction 68 No. Description Amhara Oromiya Remarks/both Tip Offs that required administrative 683 301 984 solution % of tip off that required administrative 39.2% 36.0% 38.2% solutions • Submitted to the Commissions 671 399 1070 investigators • Not submitted to investigators 25 13 38 • To be investigated by Police and others 166 123 289 • Further explanation required 655 655 • Not related to FC 465 465 8 Assets barred/ retained Land (Sq.M ) 8688 23092 31780 • Cash (in Millions) 18.22 0.576 18.796 • Residence 3 7 10 • Businesses/ stores 2 2 • Means of Transport • Vehicle 4 4 • Motor Cycle 3 3 • Other Assets (Birr in millions) 33.153 33.153 9 Assets seized/ appropriated • Land (sq.M) 3231 133,397 136628 • Land owned for Investment 343 343 • Forest land (ha.) 3613 3613 • Residence 4 5 9 • Businesses 1 1 • Cash (Birr in millions) 9.22 9.22 • Means of Transport (Vehicle) 2 2 69 No. Description Amhara Oromiya Remarks/both 10 Investigated cases 1319 836 2155 • Transferred from previous year 419 419 • Investigated by the Commission 530 713 1243 • Investigated by Police and others 419 123 542 • To be investigated (699 out of which 74 699 returned in the year) 11 Investigated cases submitted to the 397 836 1233 Prosecutors 12 Investigators Capacity 63.50% 56.33% 13 Prosecutors investigation Capacity 83.30% 66.10% 14 Conviction rate (achieved) 90.33% 82% 15 Asset Registration (of Public Servants and 12093 9948 22041 elected officials) • 1st registration 7350 6083 13433 • 2nd registration 4743 3865 8608 16 Short term trainings provided to sector staff 297336 16222 313,558 and communities (No of trainees) Female trainees 206547 4713 211,260 % of Female trainees 69.5% 29.1% 67.4% Table 2: Administrative and Service delivery Complaints by thematic area in sam 70 ple Region GRM Zone Rural Urban Service Justice Police & Civil Safety Small & Trade, Others Total Land Land Delivery & Community Service- Net Microenterprise Marketing and Courts Policing employment & Service and Investment Delivery Promotion West 212 22 23 40 - 110 35 791 1,605 Gonder 227 145 North 677 6,242 Gonder 801 495 411 48 532 946 479 86 1,762 Central Gonder 121 49 27 25 28 369 0 9 4 28 660 South 635 678 281 75 43 67 41 142 71 309 2,327 Gonder North 1,754 992 949 77 26 393 1,239 170 26 349 5,975 Wello South Wello 1,200 701 602 187 133 105 888 233 185 662 4,896 Wag Himra 425 1,095 5,699 97 31 41 1,026 281 43 1,251 9,989 Oromo Zone 1,767 329 683 23 12 77 126 1 47 104 3,169 North 7,110 1,577 9,420 1,088 372 145 1,377 1,066 735 5,027 27,917 Showa East 229 429 84 6 9 39 4 26 26 88 940 Gojam West 491 552 244 12 1 54 - 22 26 141 1,543 Gojam Awi 530 659 322 48 52 83 - 197 108 250 2,249 Dessie 12 232 280 3 - 4 29 170 34 51 815 Town Gonder 21 537 226 2 3 53 - 175 8 63 1,088 Town Bahirdar 93 396 34 189 41 37 40 63 211 196 1,300 Town 71 Zone Rural Urban Service Justice Police & Civil Safety Small & Trade, Others Total Land Land Delivery & Community Service- Net Microenterprise Marketing and Courts Policing employment & Service and Investment Delivery Promotion Sub total 15,416 9,048 19,558 2,265 822 2,039 5,716 3,144 1,645 11,072 70,490 Regional 4 64 0 0 0 3 0 1 0 4 76 Total 15,420 9,112 19,558 2,265 822 2,042 5,716 3,145 1,645 11,076 70,801 72 Annex 7: Budget Line item for the reporting of expenditure under the General-purpose grant 73 ESIF Sub-Component Total Budget Codes Sub- Federal/ Public Prog Agenc # Activity Financing FY20-24 Regional Body . y Comments Results Area 1: Participatory Watershed Management 1.1, 1.2, 1.5 Afar and Somali Excluded 189.3 Regional 211 BoAs expenditures in Afar and Somali Regions 1.1, 1.2, 1.5 Development partner financed Excluded 205.8 Federal 211 Including for RLLP and AGP-II 1.1, 1.2, 1.5 ESPES-financed Excluded 260.2 Regional 211 20% BoA recurrent expenditures 3.2 MoA Extension Dir. Capital (may include construction) Excluded 14.3 Federal 211 03 01 MoA Extension Dir: 5% capital expenditures Federal/ 3.3 EIAR and RARI Capital (may include construction) Excluded 29.1 Regional 213/213 03/- 01/- EIAR and RARI capital expenditures 1.1, 1.2, 1.5 BoAs Capital (may include irrigation) Excluded 111.1 Regional 211 BoAs: 30% capital expenditures 1.1, 1.2, 1.5 Watershed development and management Recurrent 632.2 Regional 211 BoAs: 56% recurrent expenditures Capital - Regional 211 - SPG 255.0 SPG - - - SPG 3.2 Building extension service capacity Recurrent 0.4 Federal 211 02 04 MoA Extension Dir: 50% recurrent expenditures Capital - Federal 211 03 01 - SPG 12.5 SPG - - - SPG 3.3 Building research capacity for SLM Recurrent 94.4 Regional 213 RARI recurrent expenditures Federal/ Capital - Regional 213/213 03/- 01/- - SPG 12.5 SPG - - - SPG 3.1, 4.1, Federal/ MoA NRMD: 33% recurrent expenditures, plus 4.2, 4.3 Policy, institutional, regulatory environment Recurrent 62.2 Regional 211 03/- 02/- BoAs: 4.67% recurrent expenditures SPG 12.5 SPG - - - SPG 5.1, 5.2, Federal/ MoA NRMD: 33% recurrent expenditures, plus 5.3, 6.4 Building the SLM knowledge base Recurrent 62.2 Regional 211 03/- 02/- BoAs: 4.67% recurrent expenditures SPG 12.5 SPG - - - SPG Federal/ MoA NRMD: 33% recurrent expenditures, plus 6.1, 6.2, 6.3 Management, monitoring and reporting of ESIF Recurrent 62.2 Regional 211 03/- 02/- BoAs: 4.67% recurrent expenditures SPG 12.5 SPG SPG Sub-total 2040.9 Sub-total after exclusions 1231.1 Results Area 2: Rural Land Administration 2.2-2.6 Afar and Somali Excluded 2.6 Regional 219 BoLAUs expenditures in Afar and Somali 2.2-2.6 Development partner financed Excluded 13.4 Federal 211 Including RLLP, REILA, LIFT 2.2-2.6 BoLAUs Capital (may include construction) Excluded 6.0 Regional 219 BoLAUs: 20% capital expenditures 3.2 MoA Extension Dir. Capital (may include construction) Excluded 16.5 Federal 211 03 01 MoA Extension Dir: 5% capital expenditures 2.2-2.6 Improving land tenure and administration Recurrent 208.8 Regional 219 BoLAUs: 80% recurrent expenditures Capital - Regional 219 - SPG 145.0 SPG - - - SPG 3.2 Building extension service capacity Recurrent 0.5 Federal 211 02 04 MoA Extension Dir: 50% recurrent expenditures Capital - Federal 211 03 01 - SPG 12.5 SPG - - - SPG 3.1, 4.1, Federal/ MoA RLAUD: 50% recurrent expenditures, plus 4.2, 4.3 Policy, institutional, regulatory environment Recurrent 26.4 Regional 213/219 09/- 01/- BoLAUs: 10% recurrent expenditures SPG 12.5 SPG - - - SPG Federal/ MoA RLAUD: 50% recurrent expenditures, plus 6.1, 6.2, 6.3 Management, monitoring and reporting of ESIF Recurrent 26.4 Regional 213/219 09/- 01/- BoLAUs: 10% recurrent expenditures SPG 12.5 SPG - - - SPG Sub total 483.0 74 Subtotal after exclusions 444.6 Total 2523.9 Total after exclusions 1675.7 Annex 8: Applicable Procurement KPIs in Ethiopia public procurement system KPI Description Performance Target Improvement in Procurement Cycles It measures the improvement in average bid processing time from Efficiency time the preceding year and trend Reduction in # of cancelled bids It measures the improvement in the reduction to # of cancelled bids Efficiency and reliability of from the preceding year and trend the system Increase use of competitive It measures the increased share of procurement conducted through Openness, fairness, cost procurement methods competitive procedure from preceding year and trend Increase average# of bids per tender It measures the level of increase in competition from preceding year Cost and reliability of the system Improvement in realistic procurement It measures the level of improvement in preparation and use of PP Efficiency and reliability of plan the system Increase in number of complaints It measures the improvement in the procurement compliant Reliability of the system, resolved within the standard time handling system Fairness and Accountability frame Increase in the amount of It measures the improvement in the level of openness and Transparency and procurement information provided to transparency Accountability the public Reduction in contract cost overrun It measures contract management capacity Cost Reduction in contract time over run It measures contract management capacity Time Reduction in poor quality fop contract It measures procurement and contract management outcome Quality deliverables 75 Annex 9: Persons met and discussed Federal- MoA Tefera Tadesse Director, NRM Directorate Tigistu Gebremeskel Director, RLAUD Directorate Asfaw Bonger Director Finance Directorate Kelemwa Melaku Finance Team Leader Zerom Melaku Sr. Accountant Tenaye Leta Sr. Accountant - IBEX Kelemwa Cherinet Sr. Accountant - Budget Control Gizachew Asegid Property Administration Team Leader Azeb Worku Director Internal Audit Directorate Deagayehu Desso Director, Procurement Federal -EIAR Dr. Diriba Geleti Deputy Director General Nebiyu Temtime Director, Finance & Procurement Directorate Getahun Bogale Senior Accountant Biruk Kassa Senior Budget Accountant Kasahun Negash Director, Internal Audit Directorate Etetu Teklie Property Registration & Returned Property Worker Federal PPA Martha Liuwgi Director General, PPA Jonse Gedefa Deputy Director General, PPA Nebiu Kokeb Director, PPA Demessu Lemma Director, EMCP at MoF Tsegaye Abebe Consultant, PPA SNNPR, BoA& LAU Firew Desta Representative from Land Administration Dinku Dinba Director, Finance & Procurement Directorate Belaynesh Gebeyhu Tem leader, finance case team Masresha Getachew Senior accountant Sintayhu Getachew Budget controller Zerihun Firew Director, Internal audit Melese Hilu Internal auditor 76 Getachew Alemu Plan and budget expert Dejene Mena Property management officer Biruke Amanuel Property management officer Seblework Yakob Property management officer SNNPR -RIAR Tamirat Tesema Finance & Administration director Bayreda Mussa Finance & procurement coordinator Ketema Teyeb Senior accountant Demelash Tadesse Internal audit coordinator Tesfaye Hamiso Plan & budget coordinator Tesfaye Arboto HR coordinator Tadesse Tena Property management officer SNNPR- Misrak Badawich WoFED Worknhe Esayas Head, WoFED Wondson Alemu Finance and procurement coordinator Dawit Welsado Budget officer Almnesh Teka Accountant Mitiku Ashe Property management officer Dekasa Abela Internal auditor SNNPR- WondoGenet WoFED Addisu Rago Budget officer Gosaye Budget coordinator Lentamo Lelamo Internal auditor director Habtamu Accountant Tamiru Yanche Property management officer Benshangul-G-RLAU Sentayhu Tadesse Director, Land Administration Asmamaw Meseret Director, Plan & budget Habtamu Habte Finance team, coordinator Hailu Habtu Director, internal audit Mohammed Juare Property management, coordinator 77 Ali Mohammed Property management officer Benshangul-G- BoA Bekele Anbessa Deputy Bureau Head Abay Mulu Director- Procurement & Property Administration Mhiret Mekonen Director, Planning & Budget Getachew Alemayhu Director, Internal audit Tariku Tekalegne Director, Finance Benshangul-G- Bambasie WoFED Zeleke Mekuria Coordinator, Plan and budget Geremew Teferra Coordinator, finance Bukne Shiferaw Accountant Deresse Ali Coordinator, Internal audit Asnakech Teshome Internal auditor Temsgene Tefera Procurement and property coordinator Milkias Gebisso Property management officer Benshangul-G- Kumruk WoFED Asnake Fenta Coordinator, Plan & budget Yimam Shiferaw Accountant Tamirat Bedassa Internal audit Kebede Tolossa Property management officer Federal ATVET Coordiantion Office Getachew Demissie Director Kahssay Godify Finance Team Leader Habtamu W/Senbet Budget Controller Abay Rebu HR Head Asselefech Taddesse Finance Officer Alagie ATVET Dr. Kebede Beyecha College Dean Melaku Giorgis Team Leader Property Administration Misrrak Niguessie Director of Finance and Budget 78 Kasech Andualem IBEX reporting Officer Embet Yigez Head Internal Audit Solomon Abera Head HR Amhara BoLAU Anteneh Dagnew Deputy Bureau Head Melese Damtie Deputy Bureau Head Amelework Asekeke Director HR Directorate Aynabeba Engida Acting Director Finance Directorate Yedilawork Ayele Acting Director Internal Audit Directorate Fantish Negatu Team Leader Finance Desalegne Taye Director Plan & Budget Yirdaw Guday Team Leader Procurement & Property Administration Amhara RIAR Ermias Abate (Dr.) Director General Samuuel Yitbarek Director Finance, Procurement & Property Administration Tesfahun Getnet Team Leader Finance Yihenew Tamru Director HR Directorate Ayalew Shitie Team Leader Finance, Procurement & Property Admin. Amhara Bureau of Agriculture Bosena Tegegne (Dr.) Bureau Head Markos Wondie Deputy Bureau Head Seleshi Muluneh Director Finance, Procurement & Property Administration Yishamu Yalew Team Leader Finance Ayehu Birhanu Team Leader Procurement & Property Administration Tadesse Alemu Director Internal Audit Tenaye Minale Director HR Yilmana Densa Woreda Addis Bayeh Acting Bureau Head (Finance Officer) Shitaye Demlew Senior Accountant Mengistu Getaneh Director Internal Audit Tewachew Mesfin Internal Auditor Tigist Girma Senior Finance Officer (IBEX) 79 Tesfa Terefe Team Leader Procurement & Property Administration Assefa Eshet Procurement Expert Farta Woreda Atnafu Alemye Office Head Alemu Taye Finance Team Leader Agegne Tiruneh Senior Finance Officer Amsalu Fanta Budget Expert Araya Negash Property Administration Head Oromia Bureau of Agriculture Daba Debele Bureau Head Tefera Disassa Deputy Bureau Head Wkjira Oljira HR Officer Bekele Dilgasu Director Internal Audit Mengistu Jimma Head Finance Unit Dida Gelgel Finance Officer Tsehay Moges Property Administration Adugna Tolcha Property Administration Ormia BoLAU Zelalem Tesgera Director Finance, Procurement & Property Administration Abebech Asfaw Finance Officer Abebu Nefo HR Head Kebebeush Ayana Budget Controller Megersa Olana Director Internal Audit Oromia RIAR Dr. Assefa Taa Deputy Director General Samson Seboka Director Internal Audit Geshere Kelbesa Team Leader Finance Wogari Mulugeta HR Head Ayelech Kibebew Director Finance, Procurement & Property Administration Fanaye Balcha IBEX Officer Ketema Abera Property Administration Fixed Assets 80 Tsedalech G/Michael Stock controller Ebise Tadesse Property Administration Store Keeper Ejere Woreda Tesfaye Gudeta Finance & Budget Head Morka Bacha Finance Officer Yigzaw Desalegne Head Internal Audit Temesgen Bekele Internal Auditor Eyerusalem Bekele Property Administration Tigist Fekadu Property Administration Aleltu Woreda Negash Bekele Office Head Abaynesh Gashahun Finance & Budget Head Tesfaye Asefa Budget Officer Sena Asefa Internal Audit Acting Head Atsede Getahun Internal Auditor Fikru Alemu Internal Auditor Gemechu Tefera Procurement & Property Administration Head Addisu Girma Property Administration Moges Assefa Property Administration Annex 10: Visited implementing entities Federal level implementing Regional5 level Implementing Woreda level implementing entity entity entity 5 Excluding Afar and Somali regions and including Addis Ababa and Dire Dawa city administrations 81 Ministry of Agriculture (MoA) – Bureaus of Agriculture (BoAs Woreda level WoFEDs Agricultural Extension Advisory Regional Procurement & Training Directorate (AEAT); Regulatory Bodies Natural Resource Management Directorate (NRMD), Rural Land Administration and Use Directorate (RLAUD), Agricultural Technical and Vocational Education Training Colleges (ATVETCs), Public Procurement Agency, Procurement Directorates in the visited regions Regional ATVETCs Woreda Level sector offices Ethiopian Institute of Agricultural Research (EIAR)- Management &Administration and Natural Resource Management Research Program Bureau of Land Administration Use (BLAU’s) Regional Institutes of Agricultural Research (RIARs) 82