## _cr1398 ## Source details **Canonical URL:** [_cr1398](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2013/_cr1398.pdf) ## Other formats - [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2013/_cr1398.pdf.md) - [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2013/_cr1398.pdf.json) --- ### Executive summary — objectives and key findings - Objectives of the project: - Strengthen the institutional framework for PA-RGFP implementation and performance monitoring, and improve coordination of donor assistance. - Establish a communications program and training strategy for MEF and CdC staff to take ownership and master technical aspects of reforms. - Continue work to improve budget execution (in particular capital expenditure), accounting, financial reporting, and cash management procedures, in accordance with the new WAEMU directives. - Manage and monitor PFM reforms; prepare roadmap and terms of reference for two resident advisors (18 months and 24 months assignments). - Key findings: - Positive: Commitment of ministry staff to reforms; progress in accounting; first set of consolidated financial statements (CGAF) produced in 2011. - Shortcomings and priorities: - Institutional framework exists but needs improvement in work, outcomes, and donor coordination. - Lack of coordination among MEF staff; absence of joint monitoring and coordination tools. - Budget execution insufficiently frontloaded; only a very small portion of capital expenditure appropriated in the budget law is actually executed. - Cash management framework exists but lacks effectiveness; payment decisions made without reference to the cash management technical committee (CTT). - Many government accounts remain on commercial banks’ books, including overdrawn accounts pending regularization. - Double-entry bookkeeping not used for revenue accounts; irregularities in the trial balance. - Organizational reform: draft decree on MEF reorganization needs improvement. ### Mission mandate, composition, and project scope - TA request led to an FAD TA mission in Lomé from September 19 to October 2, 2012. - Mission head: Mr. Maximilien Queyranne. - Mission members: Ms. Delphine Moretti; Mr. Jean Gustave Sanon; Mr. Blaise Yehouenou; Mr. Ephrem Ghonda Makiadi. - Project funded by EUD; FAD is executing agency. - Project scheduled to end in May 2015. - Resident advisors: - Mr. Ephrem Ghonda Makiadi — head of local project — total period 18 months — responsibilities include updating schedule, drafting TORs, organizing missions, monitoring progress. - Mr. Blaise Yehouenou — assist as needed — assignment maximum two years — focus on budget execution, cash management, government accounting. ### Roadmap and timetable of TA activities (selected items with dates and resources) - FAD resident advisor responsible for managing the reforms — As of October 2012 — 1 expert, 18 months. - FAD resident advisor responsible for improving budget execution, accounting, and cash management — As of October 2012 — 1 expert, 24 months. - Improve reliability of trial balance — December 2012 — 1 expert, 2 weeks. - Prepare a training strategy and plan — January 2013 — 1 expert, 2 weeks. - Finalize draft decree on organizational structure of the MEF — January 2013 — 1 expert, 2 weeks. - Enhance reliability of estimated cash plans; draft decree for CTT functioning — April 2013 — 1 expert, 2 weeks. - Simplify expenditure process — May 2013 — 1 expert, 2 weeks. - Establish roadmap for implementation of the LOLF — June 2013 — 1 expert, 2 weeks. - FAD inspection mission for monitoring and evaluation — September 2013 — An FAD mission. - Monitor cash management actions — October 2013 — 1 expert, 2 weeks. - Train sectoral ministries on PPMs — November 2013 — 1 expert, 2 weeks. - Strategy and action plan for strengthening the CUT — December 2013 — 1 expert, 2 weeks. - Support closing of 2013 accounts — February 2014 — 1 expert, 2 weeks. - Prepare for testing devolution of payment order authorization and financial control — March 2014 — 1 expert, 2 weeks. - Identify MEF functional needs for SIGFIP adaptation and prepare three-year IT update plan — July 2014 — 1 expert, 1 week. - Establish internal control mechanism and procedures — November 2014 — 1 expert, 2 weeks. - Implement new government chart of accounts (compare 2008 chart with WAEMU PCE and prepare implementation strategy) — March 2015 — 1 expert, 2 weeks. ### Recommendations to be implemented through the project (selected, with deadlines) - Reform management and donor coordination: - Adopt a single reform management tool by consolidating the PA-RGFP and MEF directorates’ action plans. — December 2013 - Prepare a detailed report on implementation of the PA-RGFP in the context of the upcoming review. — December 2013 - Design methodological tools for monitoring and reporting on the reforms. — June 2013 - Draft and sign an agreement with donors providing budget support and prepare a common matrix of that support. — September 2013 - WAEMU Directives implementation: - Prepare a roadmap for gradual implementation of the legal and regulatory framework resulting from the WAEMU Directives. — September 2013 - Prepare and implement a PFM change communications plan. — September 2013 - Organize a high-level workshop on implementation of the new PFM framework. — September 2013 - Budget execution and public procurement: - Adapt budget classification to WAEMU Directive 08/2009. — June 2014 - Ensure traceability in the information system of capital expenditure funded by donors. — March 2013 - Call on sectoral ministries to submit estimated PPMs for FY 2014 with the PLF submission to the National Assembly. — September 2013 - Prepare a consolidated table of PPMs and forward it to staff responsible for the annual commitment plan (PE) before fiscal year start. — November 2013 - Cash management and CUT: - Adopt draft decree defining the mechanism for collecting data for the cash plan and roles/tasks of those involved. — June 2013 - Complete closing of government accounts still at commercial banks. — December 2013 - Ensure banks submit quarterly lists of accounts maintained by public entities and perform prescribed inspections. — December 2013 - Introduce mechanism for sweeping revenue accounts into RGT current account daily and sweep RGT current account into ACCT daily. — March 2013 - Financial reporting and accounting: - Review procedures and upgrade software to make bookkeeping more reliable. — July 2014 - Continue efforts to improve trial balance reliability via internal controls. — December 2014 - Improve financial reporting and financial data in the budget review law through better coordination and procedures. — June 2013 - Conduct impact study on PGT handling cash operations and specify accountant liability in regulations. — March 2013 - Identify data sources and officials responsible for the TOFE and communicate to the Directorate of Economy (DE). — March 2013 - Identify all bank accounts included in net government position calculation and report to the BCEAO. — March 2013 - Draw up training plan and strategy for PA-RGFP implementation and WAEMU Directives preparation. — February 2013 - Train those involved in expenditure process on PFM fundamentals. — September 2013 - Modernization of MEF: - Integrate internal audit staff and functions within the Office of the Inspector-General of Finance (IGF). — February 2013 - Reclassify debt management functions within the DGTCP and poverty reduction functions within the DPPE. — February 2013 - Eliminate provisions giving FC oversight of public entities subject to private sector-type management and unify financial oversight of the public sector. — February 2013 ### Project outcomes, verifiable indicators, and deadlines (selected from Annex 3 / Tables) - PA-RGFP — Roadmap and monitoring: - Detailed roadmap with monitoring system finalized by the MEF. — September 2013 - PA-RGFP supported by performance monitoring system. — June 2013 - Costs of implementing PA-RGFP assessed for at least a three-year period. — March 2013 - Annual action plan prepared at regular intervals. — As of December 2012 - Institutional framework operational: - Units and persons responsible present results in sectoral committee regularly; staff trained; working groups operational; quarterly reports prepared; joint sectoral reviews held once every six months. — As of December 2012 - WAEMU readiness: - Senior MEF officials and spending ministries aware of challenges and changes from WAEMU Directives. — September 2013 - Roadmaps ready for medium-term implementation planning. — September 2013 - Assessment of SIGFIP changes needed to accommodate WAEMU Directives. — September 2014 - Budget execution: - Internal and external controls and diagnostics show broadly acceptable application of new legal and regulatory framework. — March 2015 - Reduce time from submission of procurement documentation to DNCMP non-objection decision from current 75-90 days to a maximum of 20 days (legislation indicates 15 days). — December 31, 2014 - Time that expenditure documentation stays with officials specified and monitored. — September 30, 2014 - Devolution of payment order authorization in at least three main spending ministries applying manuals. — March 2015 - Cash management: - Coherent annual cash management plan with monthly breakdown routinely prepared. — End-2013 - Cash management institutional framework operational and producing regular reports. — As of September 2013 - PPMs with commitments and payments prepared by main spending ministries. — End-2013 - Annual plan for short-term borrowing consistent with annual cash management plan prepared and adopted. — May 2015 - CUT: - Inventory of accounts at commercial banks updated once every six months. — As of December 2013 - Strategy and action plan adopted for establishment of the CUT. — End-2014 - Government accounting and reporting: - 2012 final accounts closed and submitted to CdC. — July 2013 - 2013 final accounts closed and submitted to CdC in 2014 per LOLF deadlines. — July 2014 - Consolidated trial balance compiled monthly. — May 2015 - CdC capacity: - CdC staff participated in training sessions on budget execution and accounting provided through the project. — As of March 2013 - MEF organization and training: - MEF has a draft decree and organization chart. — March 2013 - MEF has a training strategy reflecting WAEMU-related institutional changes. — March 2013 ### Project implementation strategy, management, and monitoring - FAD (Public Financial Management Division 2) to lead project: select short-term experts, approve TORs, supported by resident advisors and authorities’ agreement. - Resident advisors under authority of Minister of Finance to coordinate MEF directorates’ work in project areas and ensure coordination with other donors’ TA. - Mr. Ghonda Makiadi to attend reform monitoring committee and inter-agency donor group. - Mr. Yehouenou to participate in the cash management technical committee (CTT). - Four types of assistance: - Definition of reform strategy for WAEMU Directives transposition and PA-RGFP update. - Management of reforms: methodological and operational support for MEF and sectoral ministries and donor dialogue. - Operational assistance: resident advisors supported by short-term expert missions. - Programming and implementation of training and awareness-raising: PFM training strategy and plan for MEF staff, sectoral ministries, and CdC. - Monitoring and evaluation: - FAD to review and approve short-term TA reports and evaluate resident advisors’ work. - FAD follow-up inspection mission at end of first implementation year. - FAD to keep EUD informed via periodic monitoring reports. - Project performance criteria derived from objectives and indicators (Annex 3 / Tables). ### Risks to project implementation and mitigation measures - Institutional and political risk: - Delays in adoption of draft laws transposing WAEMU directives, especially the budget framework law (LOLF) which had not been passed by parliament at report submission. Legislative elections expected but date not set. - Mitigation: focus initially on improving existing financial management system. - Risk from proposed structural financial reforms: - Creation of autonomous Togolese revenue office and deposit and consignment office could change revenue recording and cash management frameworks and slow technical improvements. - Mitigation: active support to finalize draft decree reorganizing MEF and resident advisors’ assistance. - Capacity and absorption risk: - Inadequate information flow and cooperation among staff; need for capacity building. - Mitigation: resident advisors to facilitate communication, collaboration, and prioritize training. - Risk from exclusion of budget preparation from project scope: - Expenditure execution, cash management, and accounting partly depend on passage of accurate budget law and realistic programming of public expenditure. - Mitigation: West AFRITAC to cover upstream phase (budget preparation). ### Cash management and Single Treasury Account (CUT) — analysis and actions - Institutional and operational issues: - Cash management committee (CT) not active; had not met since June 2011 mission until May 3, 2011 meeting noted. - CTT not functioning optimally; as of end-September 2012, had not met since June 22, 2012. - Payment decisions often made without reference to cash plan; cash plan not routinely used to guide payments. - Cash plan and data quality: - Reliability recently improved; draft decree prepared in June 2012 to establish data production framework; cash plan accompanied by comments and annexes. - Annual estimated cash plan not yet annexed to PLF; lacks external financing amounts; reveals financing gaps reflecting unreliable estimates. - Monthly scheduling of collections and intra-year updating need improvement. - Government accounts at commercial banks: - As of June 30, 2012, government departments had 165 accounts at commercial banks (increase of 64 since June 2011 when there were 101 accounts). - Closing accounts hampered because most are overdrawn; DGTCP lacked comprehensive information on overdrawn accounts or positive balances. - DGTCP should prepare comprehensive records showing balances and contact banks on procedures for overdrawn accounts. - Decree 142/MEF/SG/DGTCP of May 21, 2010 requires banks to submit quarterly lists of accounts opened by public entities and DGTCP to perform inspections. - Short-term borrowing practice: - Issuance schedule in practice differed from initial plan (example: scheduled CFAF 30 billion and CFAF 50 billion in Jan and Jun 2012; actual issuance CFAF 13 billion in Jan 2012 and CFAF 30 billion in bonds plus CFAF 20 billion in treasury bills in June 2012). - CUT strategy: - DGTCP formulated CUT strategy in April 2012 and submitted to BCEAO; four objectives include defining CUT management with BCEAO, reducing number of commercial bank accounts, transferring project accounts to BCEAO, and outreach to donors to open project accounts at BCEAO. - Recommendations to be implemented through the project: - Adopt draft decree on data collection mechanism for cash plan roles/tasks. - Complete closing of government accounts at commercial banks. - Ensure banks submit quarterly lists of accounts opened by public entities and perform inspections. - Establish sweeping mechanism: revenue accounts (DGD and DGI) into RGT current account daily, and RGT account into ACCT daily. - Verifiable indicators (cash management and CUT): - Annual cash management plan with monthly breakdown routinely prepared. — End-2013 - Cash management institutional framework operational and producing reports. — As of September 2013 - PPMs prepared by main spending ministries. — End-2013 - Annual short-term borrowing plan consistent with cash plan prepared and adopted. — May 2015 - Inventory of accounts at commercial banks updated once every six months. — As of December 2013 - Strategy and action plan for CUT adopted. — End-2014 ### Budget execution and public procurement — findings, indicators, and actions - Budget classification and execution issues: - Current execution classification comprises nine segments versus four recommended by Directive 08/2009. - Classification coding inconsistent with 2001 GFSM; absence of program-based classification. - Speeding up budget execution, especially investment appropriations, remains an obstacle. - As of June 30, 2012, only 10 percent of domestic capital expenditure had been paid. - Externally financed expenditure not recorded in SIGFIP due to lack of procedures for donor-funded investments. - SIGFIP and appropriations managers’ platform: - Platform for appropriations managers expected operational as of January 2013; until then, ACs submit commitment records to financial controller for SIGFIP entry. - Training for ACs recommended by end-2012 to start FY 2013 operations. - Public procurement performance: - Decree 2011-059/PR updated thresholds (selected exact thresholds): - CFAF 15 million for contracts for works, supplies, or services (central and devolved government departments, public entities, decentralized local governments and their public entities, agencies, and offices). - CFAF 25 million for contracts for intellectual services (same category). - CFAF 25 million for works contracts (public enterprises and public entities). - CFAF 50 million for supply and services contracts (public enterprises and public entities). - CFAF 25 million for intellectual services (public enterprises and public entities). - For FY 2012, DNCMP validated 64 PPMs: 34 for ministries; 18 for government agencies, institutions, and local governments; 12 for public corporations. - DNCMP validated 194 DAOs out of 543 expected from PPM forecasts in first half of 2012; DNCMP recorded 60 to 90 day delays in 2011 for notices of non-objection (target 15 days); DNCMP initially rejected 152 DAOs at first referral in the period described. - Verifiable indicators (budget execution and procurement): - Internal and external controls and diagnostics reflect broadly acceptable application of new framework. — March 2015 - Time from submission of procurement documentation to DNCMP non-objection decision reduced from 75-90 days to maximum 20 days (legislation indicates 15 days). — December 31, 2014 - Time that expenditure documentation stays with officials specified and monitored. — September 30, 2014 - Devolution of payment order authorization in at least three main spending ministries. — March 2015 - Operational actions: - Resident advisors to support strengthening expenditure processes, monitor processing times, develop monitoring tables, train MEF personnel, and support DNCMP and contracting authorities. ### Financial reporting and accounting — deficiencies and actions - Main issues: - Senior government accountants lack access to full information; revenue accounting methods unsatisfactory; double-entry bookkeeping not in use for revenue-collecting agencies. - BGC (consolidated trial balance) shows anomalies as at December 31, 2011: - Opening balance of budgetary accounts includes credit amounts whereas all balances should be zero (accounts 855.1, 856.1, 980, 984, and 99). - Operations in execution of the LF shown in account 99 in an amount not corresponding to general budget outturn — linked to payments made without payment order authorization and without budgetary coverage. - Discrepancies between amounts transferred to ACCT accounts and monthly revenue collection statements recorded in accounts 475 “suspense accounts for revenues at the offices of senior government accountants”, cleared through account 132 “Cumulative balances of operational transactions” without substantiation. - FY 2011 outturn discrepancy between CGAF and PLR: CFAF 73 billion. - Table reconciliation (selected rows, in millions of CFA francs): - General budget: revenues — CGAF 314,499 / PLR 314,499 / Discrepancy - - General budget: expenditure — CGAF (354,738) / PLR (438,873) / Discrepancy (84,135) - General budget outturn — CGAF (40,239) / PLR (124,374) / Discrepancy (84,135) - 2011 budget outturn — CGAF 51,636 / PLR (22,081) / Discrepancy (73,717) - TOFE production issues: DE does not produce TOFE on schedule; last TOFE for FY 2012 presented situation as at end-June 2012 (three months late); DE lacks constant dialogue with DGTCP, DF, and Public Debt Directorate; financing data incomplete; impossible to show net government position within required 45 days. - Recommendations to be implemented through the project: - Review procedures and upgrade software to make bookkeeping more reliable. — July 2014 - Continue to improve trial balance reliability via internal controls. — December 2014 - Improve coordination among MEF staff for PLR production. — June 2013 - Conduct impact study on PGT handling cash operations and spell out accountant liabilities. — March 2013 - Identify TOFE data sources and officials and report bank accounts within net government scope to BCEAO. — March 2013 - Verifiable indicators (accounting and reporting): - 2012 final accounts closed and submitted to CdC by end-July 2013. — July 2013 - 2013 final accounts closed and submitted to CdC in 2014 per LOLF deadlines. — July 2014 - Consolidated trial balance compiled monthly. — May 2015 - CdC staff participate in training sessions provided through project. — As of March 2013 - Operational actions: - Prepare accounting instruction on monitoring and recording of revenues; assist introduction of double-entry bookkeeping in DGI and DGD. - Provide support for closing of 2012 and 2013 accounts; develop internal control mechanisms and procedures. ### Training, MEF modernization, and organizational reform - Training needs and plan: - Develop a training strategy and plan for PA-RGFP implementation and WAEMU Directives preparation; use module-based approach grouped by career area (budget, accounting, appropriations manager, auditor). - Train staff involved in expenditure process on fundamentals of PFM. — September 2013 - Verifiable indicators: strategy and related action plan approved; staff trained by workshops/seminars. — March 2013 / As of September 2013 - Organizational reform: - Decree of March 7, 2012 on ministerial organization paves way for Budget Directorate (DB) conversion into Budget General Directorate (DGB) and merger of current and capital budget preparation functions. - Draft decree clarifies organization; recommendations: - Combine internal audit functions within IGF rather than creating a separate internal audit unit reporting to the Minister. - Reclassify debt management to DGTCP (debt operational management) and poverty reduction to DPPE. - Eliminate provisions giving FC oversight of entities subject to private sector-type management and unify financial oversight. - Activities implemented through project (Table 15): - Finalize draft decree on MEF organizational structure — January 2013 — 1 expert, 2 weeks. - Support implementation of organizational audit recommendations — As of October 2012 — resident advisor support (1 expert, 18 months or 24 months variants). - Formulate training strategy and plan incorporating WAEMU reforms — January 2013 — 1 expert, 2 weeks; implement training strategy — As of October 2012 — 1 expert, 18 months. ### Terms of Reference — resident advisors (summary) - Advisor to Minister — Mr. Ephrem Ghonda Makiadi: - Assignment: October 3, 2012 to September 15, 2013 (may be extended six months). - Objectives: revitalize reform monitoring committee; integrate PA-RGFP with directorate action plans; design communications plan; train SP-PRPF staff; support MEF reorganization; step up donor dialogue; strengthen reporting on externally financed investment projects; facilitate TOFE and budget execution reporting improvements. - Reporting: 1 month after start and then quarterly; reports in French with English executive summary to Division Chief, copy to project manager and EUD project manager. - Advisor to Minister — Mr. Blaise Yehouenou: - Assignment: October 3, 2012 to September 15, 2013 (may be extended one year). - Objectives: strengthen budget execution, cash management, and accounting across PA-RGFP Programs 1, 2, 3, and 8; establish budget classification linked to chart of accounts; inventory and update regulations/manuals/procedures; assist MEF reorganization; support SIGFIP functional needs identification and three-year IT plan; monitor expenditure processing times; train ministry personnel. - Reporting: 1 month after start and then quarterly; reports in French with English executive summary to Division Chief, copy to project manager and EUD project manager. *Source: IMF Fiscal Affairs Department — Draft Schedule of Project Outcomes and mission report excerpts (project FAD_TGO_2012-3, resident advisor TORs, and Annex 3 indicators).* ### Preface ................................................................................................................ ### _cr1398 - Preface ### Executive Summary and Front Matter - Preface ........................................................................................................................................7 - Executive Summary ...................................................................................................................9 ### I. Introduction - I. Introduction ..........................................................................................................................15 ### II. Implementation Strategy for the Joint Technical Assistance Project - II. Implementation Strategy for the Joint Technical Assistance Project ..................................16 - A. Project Management ...............................................................................................16 - B. Types of Assistance Provided .................................................................................17 - C. Identification of the Risks to Project Implementation ............................................18 - D. Project Monitoring and Evaluation .........................................................................19 ### III. Managing the PFM Reforms and Coordinating with Donors - III. Managing the PFM Reforms and Coordinating with Donors ............................................19 - A. Main Recommendations of Previous Missions .......................................................19 - B. Analysis of the Current Situation ............................................................................20 - C. Recommendations to be Implemented through the Project ....................................22 - D. FAD Support through the Project ...........................................................................22 ### IV. Implementation of the WAEMU Directives - IV. Implementation of the WAEMU Directives ......................................................................24 - A. Main Recommendations of Previous Missions .......................................................24 - B. Analysis of the Current Situation ............................................................................24 - C. Recommendations to be Implemented through the Project ....................................26 - D. FAD Support through the Project ...........................................................................26 ### V. Budget Execution and Public Procurement - V. Budget Execution and Public Procurement ........................................................................27 - A. Analysis of the Current Situation ............................................................................27 - B. Recommendations to be Implemented through the Project ....................................32 - C. FAD Support through the Project............................................................................32 ### VI. Cash Management and the Single Treasury Account - VI. Cash Management and the Single Treasury Account ........................................................34 - A. Main Recommendations of Previous Missions .......................................................34 - B. Analysis of the Current Situation ............................................................................35 - C. Recommendations to be Implemented through the Project ....................................37 - D. FAD Support through the Project ...........................................................................37 ### VII. Financial Reporting - VII. Financial Reporting ..........................................................................................................39 - A. Accounting ..............................................................................................................39 - B. Production of the Fiscal Reporting Table ...............................................................42 - C. FAD Support through the Project............................................................................43 ### VIII. Modernization of the Ministry of Finance - VIII. Modernization of the Ministry of Finance ......................................................................45 - A. Training ...................................................................................................................45 - B. Organizational Structure of the Ministry ................................................................46 - C. FAD Support through the Project............................................................................47 ### Tables (listed in the Preface) - 1. Estimated Timetable for the Technical Assistance Missions Planned in the Context of the Joint Project of the European Union and Fiscal Affairs Department ......................................11 - 2. Recommendations to be Implemented through the Project .................................................13 - 3. Project Outcomes and Indicators .........................................................................................23 - 4. Activities Implemented through the Project ........................................................................24 - 5. Project Outcomes and Indicators .........................................................................................26 - 6. Activities Implemented through the Project ........................................................................27 - 7. Project Outcomes and Indicators .........................................................................................33 - 8. Activities Implemented through the Project ........................................................................34 - 9. Project Outcomes and Indicators .........................................................................................38 - 10. Activities Implemented through the Project ......................................................................38 - 11. Comparison of FY 2011 Outturns in the CGAF and the PLR ...........................................41 - 12. Project Outcomes and Indicators .......................................................................................44 - 13. Activities Implemented through the Project ......................................................................44 - 14. Project Outcomes and Indicators .......................................................................................48 - 15. Activities Implemented through the Project ......................................................................48 ### Annexes - 1. Draft Terms of Reference for Mr. Makiadi .........................................................................49 - 2. Draft Terms of Reference for Mr. Yehouenou ....................................................................55 *Source: _cr1398 - Preface (IMF PDF table of contents).* ### 3. Draft Schedule of Project Outcomes................................................................................... ### 3. Draft Schedule of Project Outcomes ### Mission mandate and composition - TA request from the Minister of Economy and Finance of Togo led to a Fiscal Affairs Department (FAD) TA mission in Lomé from September 19 to October 2, 2012. - Mission head: Mr. Maximilien Queyranne. - Mission members: Ms. Delphine Moretti (FAD advisor), Mr. Jean Gustave Sanon (resident advisor, West AFRITAC), Mr. Blaise Yehouenou and Mr. Ephrem Ghonda Makiadi (FAD experts). - Mission objectives: - Ascertain progress in implementing the PFM reform priority action plan (PA-RGFP) in areas covered by the project and monitor implementation of recommendations from FAD TA missions in 2010 and 2011. - Prepare a roadmap for implementing the EU-IMF project, including sequencing short-term expert missions. - Propose an institutional framework for managing PFM reforms and coordinating with donors to implement the PFM reform strategy (SRFP). - Draw up terms of reference for Mr. Blaise Yehouenou and Mr. Ephrem Ghonda Makiadi, resident advisors for October 2012 to September 2013. ### Stakeholder engagement and outreach - Meetings held with senior government officials including: - Mr. Mawussi D. Semodji (Minister of National Planning, Development, and Local Planning) - Mr. Mongo Aharh-Kpessou (Permanent Secretary, SP-PRPF) - Mr. Badawasso T. Gnaro (Secretary-General, MEF) - Mr. Gnandi Kossi Gilbert (State Inspector-General) - Mr. Djimba N. Ibrahima (Inspector-General of Finance) - Mr. Wolanyo K. Amawuda (Budget Director) - Mr. Kofi A. Paniah (Financial Control Director) - Mr. Mashoud Y. Amadou (Director-General of the Treasury and Government Accounting) - Mr. Kossi Tenou (National Director, BCEAO) - Mr. Bakpena Baba Kokoga (Finance Director) - Ms. Abiré Akpo (Director of Plan Financing and Implementation Control) - Mr. Sévon-Tépé Kodjo Adédzé (Director-General of Customs) - Mr. Tofio Kossi Daniel (Deputy Director-General of Taxes) - Ms. Zouréhatou Kassah-Traoré (Director of Public Procurement Control) - Ms. Johnson Ahéba (Director of Economy) - Mr. Tankpadja Lalle (First President, Audit Office (CdC)) - Engagements with donors and partners: French Embassy, French Development Agency (AFD), African Development Bank (AfDB), World Bank, United Nations Development Programme (UNDP), and EUD (Ambassador Patrick Spirlet). - Mission thanked Mr. Werner Keller, IMF Resident Representative in Lomé, and staff for assistance. ### Project scope and funding - EUD and FAD signed a TA Agreement with the Togolese government within the framework of the second institutional support program (ISP2). - The TA is funded by the EUD; FAD is the executing agency. - Project scheduled to end in May 2015. ### Executive summary — objectives of the project - Strengthen the institutional framework for PA-RGFP implementation and performance monitoring, and improve coordination of donor assistance. - Establish a communications program and training strategy for MEF and CdC staff to take ownership and master technical aspects of reforms. - Continue work to improve budget execution (in particular capital expenditure), accounting, financial reporting, and cash management procedures, in accordance with the new WAEMU directives. - Mission purpose: assess PFM arrangements at project start, monitor implementation status of prior recommendations, establish baseline for assessing progress, propose project roadmap, identify TA activities, and draw up terms of reference for two resident advisors (18 months and 24 months assignments). ### Executive summary — key findings - Positive: - Commitment of ministry staff to reforms and progress in some areas, especially accounting. - First set of consolidated financial statements (CGAF) produced in 2011. - Shortcomings and priorities: - Institutional framework for managing PFM reforms exists but needs improvement in work, outcomes, and donor coordination. - Lack of coordination among MEF staff in managing and conducting reforms; absence of joint monitoring and coordination tools. - Budget execution: - Streamlining started but needs acceleration and further simplification for future devolution of payment order authorization. - Budget execution insufficiently frontloaded to ensure quick start at fiscal year beginning. - Only a very small portion of capital expenditure appropriated in the budget law is actually executed, mainly because of poor programming and budgeting, procurement delays, and inadequate application of bidding procedures. - No monitoring of payment deadlines. - Cash management: - Framework exists but lacks effectiveness; payment decisions are made without reference to the cash management technical committee (CTT). - Need for reliable cash plans that account for ministries’ commitments and procurement plans (PPMs). - Establishment of the single treasury account (CUT) is essential. - Many government accounts remain on commercial banks’ books, including overdrawn accounts pending regularization. - Accounting and financial reporting: - Double-entry bookkeeping is not used for revenue accounts. - Lack of information on government financial operations impedes preparation of reliable accounts. - Irregularities persist in the trial balance. - Need for closer cooperation among staff to reconcile accounts with budget documents. - Organizational reform: - Future organizational structure of MEF is strategically important; room to improve provisions of the draft decree on reorganization. ### Roadmap for project implementation (timetable of TA activities) - FAD resident advisor responsible for managing the reforms - Goals: Improve PFM reform management; Organize donor coordination; Improve public finance data; Ensure local coordination and guidance of the project; Provide PFM training - Date: As of October 2012 - Resources: 1 expert, 18 months - FAD resident advisor responsible for improving budget execution, accounting, and cash management - Goals: Streamline budget execution procedures and their monitoring; Enhance cash management; Increase reliability of government accounts; Provide training in budget execution, accounting, and cash management - Date: As of October 2012 - Resources: 1 expert, 24 months - Improvement of the reliability of the trial balance - Goals: Prepare the closing of the 2012 accounts; Train DGTCP staff in the closing procedures - Date: December 2012 - Resources: 1 expert, 2 weeks - Capacity building - Goals: Prepare a training strategy and plan, incorporating the reforms resulting from the WAEMU Directives and drawing on the training modules prepared by the WAEMU Commission - Date: January 2013 - Resources: 1 expert, 2 weeks - Reorganization of the MEF - Goals: Finalize the draft decree on the organizational structure of the MEF - Date: January 2013 - Resources: 1 expert, 2 weeks - Improvement of cash management - Goals: Enhance reliability of estimated cash plans; Prepare a draft decree to ensure functioning of the cash management committee (CT) - Date: April 2013 - Resources: 1 expert, 2 weeks - Strengthening of the expenditure process - Goals: Simplify the expenditure process to speed up budget execution and procurement - Date: May 2013 - Resources: 1 expert, 2 weeks - Support for implementation of the new budget framework law (LOLF) - Goals: Establish the roadmap for implementation of the LOLF - Date: June 2013 - Resources: 1 expert, 2 weeks - Monitoring and evaluation of the project - Goals: Carry out an FAD inspection mission - Date: September 2013 - Resources: An FAD mission - Making policy makers aware of the new PFM framework - Goals: Organize a high-level seminar on the new PFM framework and the roadmap for its implementation - Date: September 2013 - Cash management improvement (monitoring) - Goals: Monitor actions to enhance reliability of estimated cash plans - Date: October 2013 - Resources: 1 expert, 2 weeks - Cash management improvement (PPMs) - Goals: Enhance reliability of PPMs; Train sectoral ministries in preparation of PPMs - Date: November 2013 - Resources: 1 expert, 2 weeks - Strengthening of the CUT - Goals: Formulate a new strategy and action plan for strengthening the CUT - Date: December 2013 - Resources: 1 expert, 2 weeks - Improvement of the reliability of the trial balance (2013 closing) - Goals: Provide direct support for the closing of the 2013 accounts - Date: February 2014 - Resources: 1 expert, 2 weeks - Strengthening of budget execution - Goals: Prepare for testing of the devolution of payment order authorization and financial control - Date: March 2014 - Resources: 1 expert, 2 weeks - Identification of MEF functional needs for SIGFIP adaptation - Goals: Assess impact of the LOLF on public financial reporting system; Compile a three-year plan for updating the IT system - Date: July 2014 - Resources: 1 expert, 1 week - Improvement of the reliability of the trial balance (internal control) - Goals: Establish an internal control mechanism and procedures - Date: November 2014 - Resources: 1 expert, 2 weeks - Implementation of the new government chart of accounts - Goals: Compare the 2008 chart of accounts with the WAEMU chart of accounts; Adapt the chart of accounts for compliance with the WAEMU Directives; Prepare an implementation strategy - Date: March 2015 - Resources: 1 expert, 2 weeks ### Recommendations to be implemented through the project (selected items with deadlines) - Reform management and coordination with donors - Adopt a single reform management tool by consolidating the PA-RGFP and the action plans of the MEF directorates — December 2013 - Prepare a detailed report on implementation of the PA-RGFP in the context of the upcoming review — December 2013 - Design methodological tools for monitoring and reporting on the reforms — June 2013 - Draft and sign an agreement with donors providing budget support, and prepare a common matrix of that support — September 2013 - Implementation of the WAEMU Directives - Prepare a roadmap for gradual implementation of the future legal and regulatory framework resulting from the WAEMU Directives — September 2013 - Prepare and implement a PFM change communications plan — September 2013 - Organize a high-level workshop on implementation of the new PFM framework resulting from the WAEMU Directives — September 2013 - Budget execution and public procurement - Adapt the budget classification to the provisions of WAEMU Directive 08/2009 — June 2014 - Ensure traceability in the information system of capital expenditure funded by donors — March 2013 - Call on sectoral ministries to submit their estimated PPMs for FY 2014 at the same time as the draft budget law (PLF) is submitted to the National Assembly (NA) — September 2013 - Before the start of the fiscal year, prepare a consolidated table of the PPMs and forward it to staff responsible for preparing the annual commitment plan (PE) — November 2013 - Cash management and the CUT - Adopt the draft decree defining the mechanism for collecting the data to serve as input for the cash plan, as well as the roles and tasks of those involved in its preparation — June 2013 - Complete the closing of the government accounts still on the books of commercial banks — December 2013 - Ensure that the banks submit quarterly lists of the accounts maintained by public entities and perform the prescribed inspections — December 2013 - Introduce a mechanism for sweeping the revenue accounts into current account of the Receiver-General of the Treasury (RGT) daily and also sweeping the RGT current account into the account of the Central Accounting Agency of the Treasury (ACCT) daily — March 2013 - Financial reporting - Review procedures and upgrade software to make the bookkeeping more reliable — July 2014 - Continue efforts to improve the reliability of the trial balance, in particular by developing internal controls — December 2014 - Improve financial reporting and the financial data provided in the budget review law through better coordination among MEF staff and the use of clearly specified procedures — June 2013 - Conduct an impact study on having the General Pay Office of the Treasury (PGT) handle cash operations and spell out the liability of accountants in the regulations — March 2013 - Identify the data sources and officials responsible for the fiscal reporting table (TOFE) for communication to the Directorate of Economy (DE) — March 2013 - Identify all bank accounts included in the calculation of the net government position and report this to the BCEAO — March 2013 - Draw up a training plan and strategy for implementing the PA-RGFP and for laying the groundwork for the gradual application of the new legal framework resulting from the WAEMU Directives — February 2013 - Train those involved in the expenditure process on the fundamentals of PFM — September 2013 - Modernization of the Ministry of Finance - Integrate the internal audit staff and functions within the Office of the Inspector-General of Finance (IGF) — February 2013 - Reclassify the debt management functions within the DGTCP and the poverty reduction functions within the Forecasting and Economic Policy Directorate (DPPE) — February 2013 - Eliminate the provisions in the decree giving FC oversight of public entities subject to private sector-type management, and unify the financial oversight of the public sector — February 2013 ### Introduction — contextual points - Since 2006, numerous FAD and West AFRITAC TA missions have supported the authorities in modernizing public finances. - WAEMU directives on public finance adopted medium- and long-term changes staggered over January 1, 2012 to January 1, 2019, calling for: - medium-term budget programming, - devolution of payment order authorization, - introduction of program-based performance budgeting, - adoption of accrual basis accounting. *Source: IMF/FAD — Draft Schedule of Project Outcomes (project TA report).* ### 3. An FAD follow-up mission in July 2010 assessed progress and helped the ### _cr1398 - 3. An FAD follow-up mission in July 2010 assessed progress and helped the ### Background and recent missions - An FAD follow-up mission in July 2010 assessed progress and helped the authorities complete their PFM reform strategy covering 10 years, with an initial three-year priority action plan (PA-RGFP) for 2010–14. The mission found considerable progress but noted deficiencies in most key aspects identified by the 2009 mission; its recommendations were incorporated into the PA-RGFP. - In June 2011, an FAD mission carried out jointly with the regional hub of the UNDP in Dakar assessed progress since 2010: - Progress was noted, especially in accounting, but most prior recommendations remained unimplemented. - The June 2011 mission repeated and expanded recommendations on budget preparation and execution, expenditure control, cash management, and financial reporting, and added recommendations on multiyear budget programming and implementation of program budgets. - The mission noted that draft laws transposing the six WAEMU directives of June 2009 had been prepared and were being adopted by the authorities. - Based on the June 2011 findings, the European Union Delegation (EUD) and FAD signed a TA agreement within the framework of the second institutional support program (ISP2), for which FAD is executing agency. Under that agreement funding will be provided until June 2015 for FAD TA, notably two resident advisors placed in the office of the Minister of Finance. ### Project objectives - The objectives of the project are to: - establish a detailed, realistic roadmap for consistent implementation of the PA-RGFP; - define a truly operational institutional framework for monitoring and managing implementation of the PA-RGFP; - establish a communications program to increase ownership of the PFM reforms; - improve budget execution, accounting, financial reporting, and cash management procedures, in accordance with the new WAEMU directives; - enhance the capacity of the Audit Office (CdC) to analyze budget and accounting data; - formulate a training strategy and actions for staff of the MEF. ### Headquarter-led mission aims (financed under the project) - Assess progress made with PFM to prepare a status report serving as a project reference. - Agree with authorities on the roadmap for project implementation. - Assign the two resident advisors and agree on their terms of reference and institutional positioning with the minister. ### Implementation strategy — Project management - FAD (Public Financial Management Division 2) will lead the project, selecting short-term experts and approving TORs, supported by resident advisors and with authorities’ agreement. - Two resident advisors placed with the minister will support local implementation: - Mr. Ephrem Ghonda Makiadi: head of the local project, for a total period of 18 months. Responsibilities include updating the schedule of short-term expert missions, proposing draft TORs to FAD, submitting TORs to authorities, and participating in mission organization and progress monitoring. - Mr. Blaise Yehouenou: assist Mr. Ghonda Makiadi as needed, assignment for a maximum of two years; support missions on budget execution, cash management, and government accounting. - Resident advisors, under the authority of the Minister of Finance, will coordinate MEF directorates’ work in project areas. - Under FAD authority, resident advisors will ensure coordination with TA from other donors; Mr. Ghonda Makiadi will facilitate West AFRITAC missions, retargeted on budget preparation and the fiscal reporting table (TOFE). - Participation in MEF meetings: - Mr. Ghonda Makiadi will attend the reform monitoring committee (under the permanent secretary) and the inter-agency donor group. - Mr. Yehouenou will participate in the cash management technical committee (CTT). ### Types of assistance provided - Four types of assistance: - Definition of a reform strategy to implement the new PFM framework from the WAEMU Directives, including updating the PA-RGFP and preparing specific strategies for MEF reorganization, establishment of the CUT, and changes to information systems. - Management of the reforms: methodological and operational support to guide and coordinate reforms within MEF and sectoral ministries, and to strengthen donor dialogue. - Operational assistance: provided primarily by resident advisors with support from short-term expert missions. - Programming and implementation of training and awareness-raising: prepare a PFM training strategy and plan for MEF staff, sectoral ministries, and the CdC; a high-level seminar on PFM reforms will be held with support from Mr. Ghonda Makiadi; resident advisors will provide training supplemented by short-term missions. ### Timetable and priority sequencing - Timetable for TA activities presented at the beginning of the report is indicative and will be amended as needed. - Priority areas and sequencing: - Revitalize existing structures and provide methodological tools for managing and monitoring reforms; rely on the existing institutional framework so restructuring can start quickly; Mr. Ghonda Makiadi’s work to fall under PA-RGFP to make it more operational and consistent with MEF directorates. - Budget execution: simplify the expenditure process, strengthen expenditure monitoring, and record expenditure; devolution of payment order authorization and FC will be implemented gradually alongside strengthening the Administrative and Financial Affairs Directorate (DAAF) in each ministry. - Cash management: make the CTT operational, improve the cash plan, and strengthen the CUT; only then improve procurement plans (PPMs) and commitment plans (PEs); establishment of liquidity management instruments (billets de trésorerie) is a longer-term objective. - Accounting and financial data production: initially increase reliability of cash basis trial balances and the TOFE; focus on timely production of consistent and reliable year-end budget laws and consolidated financial statements (CGAF); plan implementation of accrual basis accounting for the longer term. - Modernization of the ministry: priority to understand the existing PFM framework and finalize the draft decree on organizational structure of the MEF. ### Risks to project implementation - Main risks that may delay implementation and achievement of objectives in the EU-IMF agreement: - Institutional and political risk: delays in adoption of draft laws transposing WAEMU directives, especially the budget framework law (LOLF), which has still not been passed by parliament. Legislative elections expected soon, but date not set at report submission. Mitigation: focus initially on improving the existing financial management system. - Risk from proposed structural financial reforms: general reorganization of the MEF, planned creation of an autonomous Togolese revenue office (impacting revenue recording), and establishment of a deposit and consignment office (Caisse des dépots et consignations) (could change cash management framework). Structural reforms could slow technical management improvements. Mitigation: active support to finalize the draft decree reorganizing the ministry and resident advisors’ assistance. - Risk related to MEF absorption and reform capacities: inadequate information flow and cooperation among staff; capacity building required. Mitigation: resident advisors will facilitate communication and collaboration and training actions will be prioritized. - Risk related to exclusion of budget preparation from project scope: expenditure execution, cash management, and accounting partly depend on passage of an accurate budget law and realistic programming of public expenditure, especially capital expenditure. Mitigation: West AFRITAC will cover the upstream phase of PFM (budget preparation). ### Project monitoring and evaluation - FAD will monitor and evaluate the project: - Review and approve reports of short-term TA experts and evaluate resident advisors’ work. - An FAD follow-up inspection mission will take place at the end of the first year of implementation. - FAD will keep the EUD in Togo informed via periodic monitoring reports. - The mission has broken down and sequenced objectives and performance indicators from the EU-IMF agreement; these will constitute the project performance criteria (see Annex 3). - The IMF resident representative will hold regular meetings with the EUD, with resident advisors participating as necessary. ### Managing PFM reforms and coordinating with donors — Recommendations from prior missions - September 2010 FAD mission recommendations: - Clarify design, implementation, coordination, and monitoring functions for PFM reforms, specifying roles and tasks of those involved. - Strengthen the inter-ministerial committee for monitoring reform policies and financial programs (PRPF) with donors, expanding its scope to include all ministries and specifying responsibilities. - June 2011 FAD mission recommendations: - Develop a clear, realistic strategy including a change management process to help put the new PFM framework into effect. - Create a high-level structure to guide implementation of the PFM reform strategy. - Seek donor assistance, based on the roadmap, to obtain necessary support for reform implementation. ### Analysis of the current situation — institutional framework and coordination - Reform management institutional framework: - The institutional framework remains unchanged. Decree 2012-006/PR of March 7, 2012 confirms the existence of the SP-PRPF operating directly under the minister. Tasks remain defined by Decree 2008-031/PR of February 15, 2008. Decree 154 of June 19, 2008 continues to identify PRPF committee members without specifying duties. - SP-PRPF is organized into four divisions responsible for: - Division 1: monitoring relations with the IMF and the AFD; - Division 2: monitoring relations with the World Bank and the AfDB; - Division 3: monitoring reforms in all ministries and relations with the EU; - Division 4: coordinating financial policies, particularly in the parapublic sector. - This structure disperses 13 professionals and overburdens Division 3, complicating donor coordination as donor monitoring is distributed among Divisions 1, 2, and 3. - A draft implementing regulation for the decree on ministerial organization proposes restructuring SP-PRPF into two units: one for monitoring programs and one for monitoring reforms. The draft reiterates SP-PRPF tasks and adds a stronger inter-ministerial role; while not perfect, it could facilitate donor coordination and reform monitoring. SP-PRPF must ensure coordination between donor-supported reforms and authority-led PA-RGFP reforms. - Despite efforts, SP-PRPF is not fully operational: the monitoring committee is not meeting quarterly as required to monitor PA-RGFP implementation, although reform focal points have been designated in all ministries per Decree 109/MEF/SP-PRPF of April 23, 2010. SP-PRPF’s recent focus has been guiding establishment of medium-term expenditure frameworks (MTEF) in sectoral ministries to enable appropriations managers to prepare PPMs and DAO by end-2012 to increase appropriation use. SP-PRPF cannot yet monitor reforms handled by MEF directorates, which are under the Secretary-General and do not submit regular reports. - Mission recommendation: revitalize the existing institutional framework rather than adopt a new one. Coordination problems stem more from inadequate information flow and collaboration among MEF units and across ministries. Entities responsible for managing and monitoring reforms should meet more regularly and improve available tools, with resident advisor support. - Public finance reform strategy: - PA-RGFP implementation is hampered by a disconnect with MEF directorates’ action plans. PA-RGFP has not been broken down into specific activities; MEF directorates have detailed action plans that have not been consolidated into a single action plan as PA-RGFP should be. Consolidation would facilitate a reform database and regular monitoring by the PRPF committee. - Half-yearly reviews of PA-RGFP implementation do not facilitate operational monitoring: SP-PRPF cannot collect reform monitoring data due to lack of a common methodological approach among directorates. Review reports do not allow determination of progress and problems over the previous six months. The next review scheduled for November 2012 should provide a full, up-to-date report on PA-RGFP implementation since adoption in 2010, allow assessment of two years of implementation, and identify priority measures and actions for 2013. - Cooperation and coordination with donors: - The inter-agency donor group on public finance is insufficiently active despite donors’ considerable involvement since 2006 via institutional support programs (AfDB, EU, UNDP), TA (West AFRITAC, French Embassy), and budget support (World Bank, AfDB, EU). - The group responsible for authority-donor relations under SP-PRPF is not yet a framework for dialogue and regular discussion on public finance; reforms are monitored within each donor’s project context. - Coordination tools introduced by government and donors are not fully operational. MEF directorates have defined TA needs within PA-RGFP implementation, but these have not been consolidated. A common matrix of budget support prepared with main donors has not yet been approved. *Italic: IMF staff report excerpt (project and mission findings, objectives, implementation strategy, risks, monitoring, and donor coordination).* ### 28. The donors with whom meetings were held during this mission expressed their ### _cr1398 - 28. The donors with whom meetings were held during this mission expressed their ### Donor coordination and joint dialogue - Donors expressed a shared wish to strengthen the joint dialogue with the authorities. - The World Bank suggested: - a common matrix of prior actions and triggers; and - a mechanism for budget support operations’ joint reviews. - Other donors expressed interest in such an approach, which could be led by the government with support from the resident advisor responsible for reform management and donor coordination. - Mission suggestions: - revive the inter-agency donor group on the basis of coordination tools; - establish a system of joint reviews by donors (the small number of donors active in Togo should facilitate collaboration); - organize the group’s work on a more regular basis and provide tools such as: - a comprehensive map of donor involvement in the PFM area; and - a costing of TA needs. - prepare and sign an agreement between the authorities and the donors providing budget support defining a framework and method for joint reviews, without establishing a new inter-agency donor group. - decide among authorities and donors who will sign the agreement and who will participate in joint reviews. ### Recommendations to be implemented through the project - Acquire a single reform management tool by consolidating the PA-RGFP and the action plans of the MEF directorates; - Conduct a detailed survey of PA-RGFP implementation as part of the next review; - Design methodological tools for monitoring and reporting on the reforms; - Draft and sign an agreement with the donors providing budget support, and prepare a common matrix of triggers for these operations. ### FAD support through the project — objective and verifiable indicators - Joint support of the EU and FAD aimed at ensuring implementation of the PA-RGFP over the period 2012–14 and strengthening reform management and monitoring mechanisms, including the framework for dialogue with donors. - Verifiable indicators: - satisfactory progress in the implementation of the action plan, as attested by the minutes of the joint reviews; and - meetings of the partnership framework with the donors involved in the PFM area. ### Expected project outcomes — description - Government should have: - a realistic roadmap for implementing the PA-RGFP; and - an operational institutional framework. - Roadmap features: - detailed roadmap based on an estimated costing of implementation and a monitoring system that defines indicators, targets, and outcomes; - reflected in annual action plans defined and monitored in half-yearly sectoral reviews. - Institutional framework features: - identification of officials responsible for monitoring the reforms and trained under the project; - sectoral reviews conducted on a half-yearly basis with donor participation. ### Verifiable indicators and deadlines (PA-RGFP) - The verifiable indicators remain the same in substance; completion dates set and slightly staggered due to delays. - Table 3. Project Outcomes and Indicators (selected specifics preserved verbatim): - 1.1. PA-RGFP – The government of Togo has a realistic roadmap for implementing the PFM strategy adopted. - A detailed roadmap with a monitoring system (indicators and targets) for implementation of the PA — September 2013 - The PA-RGFP is supported by a performance monitoring mechanism. — June 2013 - The costs of implementing the PA-RGFP are assessed for at least a three-year period. — March 2013 - An annual action plan highlighting the priority measures and the expected outcomes for the year is prepared at regular intervals. — As of December 2012 - 1.2. PA- RGFP – The institutional framework for managing implementation of the PA-RGFP is operational. - The structures and persons responsible for reform implementation and monitoring regularly present the results of their work in the sectoral committee. — As of December 2012 - The staff responsible for monitoring the reform and preparing the periodic reports are trained. - Working groups for each program in the PFM reform strategy are fully operational. - Each working group prepares quarterly reports on implementation of the program. - The joint sectoral reviews on progress made in the implementation of the PA-RGFP are held once every six months in the context of the inter-agency donor group, on the basis of the annual plans and the monitoring system. ### Institutional framework notes - Indicator concerning appointment of persons responsible for monitoring reform was reformulated: mention of actual appointment removed because it depends solely on the decision of the authorities. - Various indicators expected to be met by December 2012 (date of the first half-yearly PFM review). ### Operational action plan (selected activities and resources) - FAD resident advisor responsible for reform management: - Prepare for the next review of the PA-RGFP — As of October 2012 — 1 expert, 18 months - Improve the PA-RGFP monitoring reports - Improve the integration of the PA-RGFP with the action plans of the directorates - Establish a database of the activities and the recommendations made by FAD, the short-term experts, and West AFRITAC, and organize the monitoring of performance indicators - Organize regular committee meetings - Map donor involvement in the PFM area - Finalize the costing of PA-RGFP activities ### Implementation of the WAEMU Directives — main recommendations from previous missions - Promptly take steps necessary for transposition of the new WAEMU directives into national law; - Develop an action plan to ensure consistency of the existing legal framework with the provisions in the draft organic law establishing the Transparency Code; - Insert transitional provisions in the draft LOLF to incorporate Article 86 of the directive and prepare an implementation schedule for the period 2012–19. ### Current situation analysis on WAEMU transposition - Authorities laid groundwork: draft LOLF, draft law establishing the Transparency Code, and four decrees on government accounting, government budget classification (NBE), government chart of accounts (PCE), and fiscal reporting table (TOFE). - Legislation submitted to the National Assembly but not passed during the last session. Finance Committee objected to Article 25 of draft LOLF (Minister of Finance able to cancel appropriations). - Mission urges authorities to secure passage of legislation (national transposition deadline expired at end-2011) while ensuring amendments suggested by previous FAD mission, including transitional period and authorizing tests. - Pending enactment of new LOLF, mission suggests: - review draft decrees and inventory regulations requiring amendment; - reconsider draft decree establishing the PCE to clarify accounting treatment of capital transfers and project grants. - Authorities should immediately begin preparing for gradual implementation of the directives: - PA-RGFP mentions transposition but actual implementation requires more detailed activities with timetables corresponding to regional directive deadlines. - FAD can provide assistance as part of the EUD-financed project to facilitate revision of the PA-RGFP in 2013. - MEF could start implementing the new NBE and new PCE and prepare for changes in SIGFIP: - prepare analytical study of current budget classification and chart of accounts to identify differences from the directives; - prepare bridge tables and implementation timetable; - configure SIGFIP and align timing of changes with organizational and operational process changes. - Training and awareness-raising actions recommended: - communications plan and coherent training strategy to create a critical mass within the MEF to carry reforms forward and to obtain support from senior officials, sectoral ministries, and parliament. ### Recommendations to be implemented through the project (WAEMU) - Prepare a roadmap for gradual implementation of the future legal and regulatory framework resulting from the WAEMU Directives; - Prepare and implement a PFM change communications plan; - Organize a high-level workshop on implementation of the new PFM framework. ### FAD support through the project — objective and verifiable indicators (WAEMU) - Project objective: ensure budget execution, accounting, control, and execution reports are in compliance with the WAEMU Directives (ambitious given project ends in June 2015). - Regional directive deadlines noted: - January 1, 2017 for the devolution of payment order authorization and the annexes to the budget review law; - January 1, 2019 for general accounting. - Expected outcome: readiness to implement the WAEMU Directives, with priority on capacity building, educating key players, formulating implementation strategy, and evaluating impact on existing information systems. ### Verifiable indicators and deadlines (WAEMU) - Table 5. Project Outcomes and Indicators (selected specifics preserved verbatim): - 2. Regulatory and institutional framework – Readiness to implement the WAEMU Directives - Senior officials of the MEF and the spending ministries are aware of the challenges and the changes resulting from the PFM reform and especially from the WAEMU Directives. — September 2013 - Roadmaps are ready for planning medium-term implementation of the directives in the areas covered by the project. — September 2013 - An assessment has been made of the changes necessary to enable SIGFIP to take account of the new environment created by the WAEMU Directives. — September 2014 ### Operational action plan (WAEMU) — activities and resources - FAD resident advisor responsible for strengthening budget execution, accounting, and cash management: - Inventory the regulations, manuals, and procedures to be amended — As of October 2012 — 1 expert, 24 months - Support updating of the regulations, manuals, and procedures - Prepare a budget classification consistent with the government chart of accounts, in accordance with the WAEMU Directives - Propose a communications plan on PFM reforms - Train SP-PRPF staff to manage the reform - Support implementation of the new LOLF - Prepare the roadmap for implementation of the LOLF — June 2013 — 1 expert, 2 weeks - Make decision-makers aware of the new PFM framework — Organize a high-level seminar on the new PFM framework and the roadmap for its implementation — September 2013 — An FAD mission - List the functional needs of the MEF for changes in SIGFIP - Assess the impacts of the LOLF on the government financial reporting system - Develop a three-year plan of changes in the IT system — July 2014 — 1 expert, 2 weeks ### Budget execution and public procurement — key findings from analysis - Previous mission recommendations included: - issue the appropriations decrees in early January; - review the regulatory system to simplify and streamline it; - formulate a strategy for devolution of payment order authorization and Financial Control (FC); - put in place a data entry platform for use solely by appropriations managers; - finalize organizational changes required to unify current and capital expenditure execution processes. - Public procurement: coordination improved among DNCMP, contracting authorities, and public procurement staff, but weaknesses remain: limited capacity and delays in PPM and DAO preparation, and relatively low level of public procurement. - Specific recommendations for procurement and cash planning: - prepare PPMs after submission of the PLF to the NA office and update in January after publication of the LFI; - improve the type of information recorded in PPMs and PEs and reduce time to produce and update them; - prepare PEs on the basis of PPMs and regularly harmonize them with the cash plan. ### Budget classification and execution conditions — findings and statistics - Budget classification issues: - Expenditure execution budget classification comprises nine segments (eight, excluding the title, corresponding to economic type) versus four (administrative, program-based, functional, and economic) recommended in Directive 8/2009. - Broken down into sections, chapters, subchapters, descriptions, functional codes, articles, paragraphs, and lines; chapter code ranges between 10 and 15 characters. - Structure promotes proliferation of budget envelopes; economic classification coding inconsistent with the 2001 GFSM; lacks program-based classification in the new directive. - Budget execution challenges: - Speeding up budget execution remains an obstacle, especially for investment appropriations. - Despite manuals, tools, and donor capacity-building workshops, progress not sufficient to strengthen execution of the line-item budget; capacity for budget execution in compliance with rules remains weak; reporting on budget execution is neither reliable nor comprehensive. - Wage bill execution: - Civil service survey completed; results being processed by a private firm; problems in taking results into account are being clarified by the Finance Directorate (DF) with the firm. - Domestic capital expenditure execution capacity: - As of June 30, 2012, only 10 percent of expenditure in this category had been paid. - Causes: insufficiently selective programming; inaccurate budgeting of investment projects; cumbersome expenditure process and contracts difficult to execute within fiscal year due to principe d’annualité budgétaire. - Externally financed expenditure is not recorded in SIGFIP due to lack of procedures for collecting data on donor funded investments. - Use of SIGFIP and platform for appropriations managers: - SIGFIP provides functionalities for automation and monitoring execution deadlines; managers should use these tools to avoid duplications and delays. - Platform for ACs to input data from expenditure commitment records not yet operational; expected operational as of January 2013. - Until then, appropriations managers submit commitment records to the financial controller who enters data into SIGFIP. - Training for ACs should be provided by end-2012 if start-up as of FY 2013 is desired. _Italic: Extracted from the IMF mission report content provided in the source PDF._ ### 53. The decree on the distribution of appropriations and the expenditure ### _cr1398 - 53. The decree on the distribution of appropriations and the expenditure authorization forms ### Decree on distribution of appropriations and expenditure authorization - The decree on the distribution of appropriations and the expenditure authorization forms are prepared by the Budget Directorate (DB) following passage of the initial budget law (LFI). - The decree on the distribution of appropriations is the legal instrument on which implementation of the approved budget is based. - The decree is "always signed late," because MEF staff prepare it after the LFI has been passed; to enable execution steps, appropriations managers are provided with expenditure authorization forms before the decree is signed. - Legal ambiguity: the legality of using expenditure authorization forms before the decree has been signed is unclear. - Recommendation: priority should be given to drafting the decree on the distribution of appropriations as soon as the PLF has been submitted to the National Assembly, because changes to the PLF during the parliamentary debate are "generally limited." ### Financial control (FC), authorizing officers, and devolution - Current authorizations: - The Minister of Finance remains the sole senior authorizing officer for the government budget. - The Director of Finance is delegated authorizing officer for operating expenditure. - The Plan Financing and Implementation Monitoring Directorate (DFCEP) is the delegated authorizing officer for capital expenditure. - Exception: Ministry of Defense administrative and financial officer is its delegated authorizing officer. - Institutional capacity: - There are over 500 ACs in Togo, compared with about 20 financial controllers. - FC’s oversight responsibilities span the whole country. - Medium-term objective: set up FC offices in sectoral ministries and devolve payment order authorization to sectoral ministries and regions. - Views of Financial Control Directorate: devolution of the expenditure control function should go hand in hand with devolution of payment order authorization, and delegated FC should be assigned to authorizing officers (senior, delegated, or junior) rather than to ACs. - Experimental proposal: nothing prevents carrying out FC on an experimental basis at a limited number of ministries for controlling ACs’ operations after SIGFIP deployment. - Status of implementation: - Implementation of the strategy for gradual setting up of FC offices and devolution of payment order authorization has not begun. - A February 2012 FAD mission suggested a controlled, gradual approach; it has not yet been implemented. - Pending enactment of the LOLF, reorganization of ministerial departments (creation of DAAFs) is a major step: DAAFs would be ACs for their own appropriations and delegated authorizing officers appointed by their minister. Appropriations managers would continue to prepare expenditure commitment proposals; DAAFs would perform commitment and payment order authorization functions. ### Two parallel execution processes (current vs capital expenditure) - Current expenditure process: - Prepared by ACs, cleared and entered into SIGFIP by FC, verified by ACs, validated by the financial controller, authorized for payment by the DF, and paid by the General Pay Office of the Treasury (PGT). - Capital expenditure process: - Follows the same process except DFCEP is responsible for payment order authorizations. ### Public procurement: reforms, agencies, thresholds, and bottlenecks - Legal and regulatory reform since 2009 demonstrates willingness to align with international standards and WAEMU Directives. - Relevant instruments cited: Law 2009-013/PR of June 30, 2009; Decrees 2009-277/PR, 2009-295/PR, 2009-296/PR, 2009-297/PR; Decree 2008-178/PR of December 19, 2008. - WAEMU Directives cited: Directives 04/CM/2005 and 05/2005/CM of December 9, 2005. - Institutional improvements: - Creation of Public Procurement Regulatory Authority (ARMP) and other agencies. - November 2011: ARMP organized training for procurement staff (preparation of PPMs). - April 2012: ARMP validated model bid documents and trained procurement agencies. - Thresholds updated by Decree 2011-059/PR of May 4, 2011: - Central and devolved government departments, public entities, decentralized local governments and their public entities, agencies, and offices: - CFAF 15 million for contracts for works, supplies, or services. - CFAF 25 million for contracts for intellectual services. - Public enterprises (public and semi-public corporations) and public entities: - CFAF 25 million for works contracts. - CFAF 50 million for supply and services contracts. - CFAF 25 million for intellectual services. - Performance and delays: - PPM validation process remains too slow for processing to start at the beginning of the fiscal year. - For FY 2012, the DNCMP validated 64 PPMs: - 34 for ministries; - 18 for government agencies, institutions, and local governments; - 12 for public corporations. - Authorities invited sectoral ministries to submit PPMs for the 2013 LFI in 2012; as of end-September 2012, no ministry had submitted draft PPMs for FY 2013 to the DNCMP. - PPMs are not yet used as a cash management tool: - The DNCMP should compile an annual consolidated table of PPMs before inputting data into the annual estimated PE; to date the consolidation statement has been produced only at year-end for reporting. - DAO preparation delays and rejection rates slow expenditure execution: - During first half of 2012, DNCMP validated 194 DAOs out of 543 expected from the forecasts in the PPMs. - DNCMP recorded delays of from 60 to 90 days in 2011 for notices of non-objection; target is to reduce to 15 days from receipt of the DAO (legislation indicates 15 days). - DNCMP initially rejected 152 DAOs at first referral in the period described. - Recommendation: ARMP should prepare a circular making the use of the model DAOs mandatory. - Role of DNCMP: should play a more proactive advisory and monitoring role (Article 4 of Decree 2009-295/PR), provide technical support from PPM/DAO preparation through acceptance, monitor PPM implementation rates, and remind contracting authorities about deadlines. - Contracting authorities should ensure execution deadlines permit proper budget funding during the year. ### Recommendations to be implemented through the Project (excerpt) - Adapt the budget classification for compliance with the provisions of WAEMU Directive 08/2009. - Ensure traceability in the information system of capital expenditure financed by donors. - Call on sectoral ministries to submit their estimated PPMs for FY 2013 at the same time as the PLF is being submitted to the NA. - Before the start of the fiscal year, prepare a consolidated table of PPMs and forward it to the staff responsible for compiling the annual PE. ### FAD support through the Project — objectives, outcomes, indicators, and operational actions - Project two main objectives: - Improve budget execution, especially priority capital expenditure and public procurement by simplifying the expenditure process and reducing execution time and use of exceptional procedures. - Train officials to ensure proper application of new procedures. - Expected outcome: improvement in budget execution and expenditure procedures via resident advisors and short-term experts. - Verifiable indicators and deadlines (Table 7 content reproduced): - Outcome: Budget execution and expenditure procedures are improved. - Indicator: Internal and external controls, and diagnostic studies after updating manuals, reflect a broadly acceptable application of the new legal and regulatory framework. - Deadline: March 2015. - Indicator: The expenditure process is streamlined and flows more smoothly; specifically: - The time between submission of procurement documentation to the DNCMP and delivery of its non-objection decision is reduced from the current 75-90 days to a maximum of 20 days, compared with the 15 days indicated in the legislation (December 31, 2014). - The length of time that expenditure documentation should stay with the various officials involved in its processing, as established by the decree of April 20, 2011, is specified for each phase and monitored regularly (September 30, 2014). - Overall deadline for the outcome: March 2015. - Indicator: Devolution of payment order authorization is in place in at least three of the main spending ministries, with those ministries applying rules contained in the manuals on budget execution and accounting procedures. - Deadline: March 2015. - Operational action plan (Table 8 activities and resources): - FAD resident advisor responsible for strengthening budget execution, accounting, and cash management: - Support to mission on the budget execution procedure. - Start date: As of October 2012. - Resources: 1 expert, 24 months. - Tasks: organize monitoring of processing times, develop table for monitoring processing times, assist implementation of suggestions to improve expenditure process (including payment delays), train MEF personnel, train DAFs and financial controllers. - FAD resident advisor responsible for managing the reforms: - Strengthen mechanisms for reporting to donors on externally financed investment projects. - Start date: As of October 2012. - Resources: 1 expert, 18 months. - Short-term expert support: - Strengthen the expenditure process to shorten budget execution and procurement delays. - Date: May 2013. - Resources: 1 expert, 2 weeks. - Prepare for testing of the devolution of payment order authorization and FC. - Date: March 2014. - Resources: 1 expert, 2 weeks. ### Cash management and Single Treasury Account (CUT) - Previous mission recommendations (FAD and West AFRITAC): - Establish a policy framework and introduce active cash management and a single treasury account (CUT). - Make the institutional cash management framework operational. - Cash management recommendations: - Prepare an annual estimated cash plan simultaneously with the PLF and submit it to parliament with the PLF. - After PLF approval, prepare a rolling quarterly cash plan with each operational month subdivided into weeks. - Improve disbursement programming quality via PPMs and PEs. - CUT objectives: - Ensure accounts of customs (DGD), tax (DGI) directorates, and Receiver-General of the Treasury (RGT) are swept into the ACCT current account more quickly. - Reduce number of government bank accounts at commercial banks. - Streamline number of accounts maintained at the BCEAO by senior government accountants. - Analysis of current situation — institutional framework: - Cash management committee (CT) is not active; supposed to be chaired by Minister of Finance and meet monthly; CT had not met since the June 2011 mission and only met on May 3, 2011. - Cash management technical committee (CTT) does not function optimally: - Responsible for preparing and updating annual cash plan; supposed to meet monthly. - As of end-September 2012, CTT had not met since June 22, 2012. - Supposed chair: Minister of Finance; in practice: Secretary-General of the Ministry chairs the CTT and forwards conclusions to the Minister; no decisions are communicated back to CTT by the minister. - Practically, expenditure payment decisions take no account of the cash plan and are not monitored. - Cash management tools and data quality: - Reliability of the cash plan was recently improved; headings improved and draft decree prepared in June 2012 to establish data production framework; tables forwarded to data-reporting departments. - Cash plan now accompanied by brief comments and annexes (monthly statement of revenue by agency; monthly statement of payments by major type; expenditure settled for previous fiscal year). - Despite progress, the annual estimated cash plan does not yet accompany the PLF; draft LOLF requires the cash plan be an annex to the PLF. - Annual estimated cash plan lacks external financing amounts; data collection process needed to capture both estimates and actuals. - Cash plan reveals a financing gap over the 12 months which reflects unreliable estimates rather than reality. - Implementation in 2012 shows significant gaps between monthly estimates and outturn, mainly in revenue: - Weaknesses in intra-year scheduling and updating of cash plan. - Monthly scheduling of collections needs improvement; cash plan data must be continuously revised to reflect actual execution. - On the expenditure side, PPMs and PEs are not used for cash plan preparation; disbursements are programmed based on disbursements in the three previous years and GDP changes, not on ministries’ spending intentions. - Use of short-term borrowing: - Scheduling of treasury bill issuances was not based on actual needs from the cash plan. - Estimate showed two issuances scheduled for January 2012 and June 2012 for CFAF 30 billion and CFAF 50 billion, respectively. - In reality: - CFAF 13 billion in bonds was issued in January 2012. - CFAF 30 billion in bonds and CFAF 20 billion in treasury bills, totaling CFAF 50 billion, were issued in June 2012. - Redemption of CFAF 20 billion in June 2012 relates to a 2011 issuance. - Market interventions with short-term securities should absorb temporary deficits from mismatches between revenue collections and expenditures. - Establishment of the CUT — strategy and account consolidation: - DGTCP formulated an overall CUT strategy in April 2012 and submitted it to the BCEAO for opinion. - Four major objectives identified: define CUT management mechanism with BCEAO; reduce number of accounts at commercial banks; transfer project accounts to the BCEAO; outreach to donors to open project accounts at the BCEAO in future, with corresponding actions. - Closing government accounts at commercial banks should continue: - As of June 30, 2012, government departments had 165 accounts at commercial banks. - Overall number increased by 64 since the last FAD mission (101 accounts in June 2011). - Senior government accountants also maintain several accounts at the BCEAO. - Closing accounts at commercial banks hampered by most being overdrawn; banks require settlement of outstanding balances first. - DGTCP lacked information on number of overdrawn accounts or amounts of positive balances. - DGTCP should prepare comprehensive records on bank accounts showing balances and should contact banks on practical procedures for overdrawn accounts. - DGTCP must perform tasks assigned by Decree 142/MEF/SG/DGTCP of May 21, 2010 establishing conditions for opening accounts by government departments at commercial banks, including ensuring banks submit quarterly lists of accounts opened by public entities and conducting inspection missions. *Source: _cr1398 - 53. The decree on the distribution of appropriations and the expenditure authorization forms (PDF chapter).* ### 79. Arrangements have not been made for the revenue accounts (DGD and DGI) to ### 79. Arrangements have not been made for the revenue accounts (DGD and DGI) to ### Cash management and single treasury account (CUT) - Finding: Arrangements have not been made for the revenue accounts (DGD and DGI) to be swept into the account of the ACCT daily. In the absence of such arrangements, a daily sweep in favor of the ACCT cannot take place, and this is apt to hinder the smooth settlement of expenditure, even when cash is available. - Mitigating change: A new mechanism for the centralization of revenue in a single account has been adopted, involving the sweeping of the DGD and DGI accounts into the RGT account daily. This is not yet in effect, and it is unclear whether the RGT account will be systematically swept into the ACCT and, if so, how often. C. Recommendations to be Implemented through the Project - Adopt the draft decree on the mechanism for collecting the data needed for the cash plan and on the roles and tasks of those involved in preparing the plan; - Complete the closing of government accounts still on the books of commercial banks; - Ensure that the banks submit quarterly lists of the accounts opened by public entities and perform the prescribed inspections; - Establish a mechanism for sweeping the revenue accounts into the RGT current account daily and for sweeping the RGT account into the ACCT account daily. D. FAD Support through the Project — Project objective and verifiable indicators - Project aim: improve cash management and strengthen the CUT, within the framework of improvements to budget execution. Expected project outcomes - Expected outcomes: improved cash management and gradual restoration of the CUT. These actions depend on: - a more reliable cash plan and an operational cash management institutional framework; - the preparation of PPMs and annual short-term borrowing (Treasury bill) plans; - better data on and reduction in the number of government accounts. Verifiable indicators and deadlines - Sequencing and information on cash management indicators are improved; CUT indicators are specified. - Due to project launch delay: - Indicator on the preparation of cash plans postponed to end-2013 (to facilitate preparations for FY 2014). - Indicator on the institutional framework postponed. - Specific indicators and deadlines (from Table 9: Project Outcomes and Indicators): - 3.2 Cash management – cash management is improved. - A coherent annual cash management plan with a breakdown by month is routinely prepared. — End-2013 - The cash management institutional framework created by the MEF decrees is operational and produces regular reports at all levels. — As of September 2013 - PPMs containing information on commitments and payments are prepared by the main spending ministries. — End-2013 - An annual plan for short-term borrowing (Treasury bills) consistent with the annual cash management plan is prepared and adopted by the MEF, along with the annual cash management plan. — May 2015 - 3.3 Single treasury account – the CUT is gradually restored at the central bank. - The inventory of accounts maintained at commercial banks by government entities is updated once every six months. — As of December 2013 - A strategy and an action plan are adopted for establishment of the CUT. — End-2014 Operational action plan (selected activities and resources from Table 10) - FAD resident advisor responsible for strengthening budget execution, accounting, and cash management - Support the strengthening of CT activities — As of Oct. 2012 — 1 expert, 24 months - Support the formulation of annual, monthly, and weekly estimated cash plans - Support the actions taken to close bank accounts - Improving cash management - Enhance the reliability of the estimated cash plans; Prepare a draft decree on ensuring the proper functioning of the CTT — April 2013 — 1 expert, 2 weeks - Continue actions to enhance the reliability of the estimated cash plans — Oct. 2013 — 1 expert, 2 weeks - Enhance the reliability of the PPMs; Train staff of the sectoral ministries in the preparation of PPMs — Nov. 2013 — 1 expert, 2 weeks - Strengthening the CUT - Formulate a new strategy and action plan for strengthening the CUT — Dec. 2013 — 1 expert, 2 weeks ### Financial reporting — Accounting Main recommendations of previous missions - Reorganize and improve revenue accounting; continue installation of accountants in customs and tax directorates to have revenue-collecting agencies use double-entry bookkeeping. - Improve reliability of consolidated trial balance (BGC) and consolidation/production of government accounts: correct shortcomings in BGC (opening balance, unsubstantiated closing balances), reduce time to produce year-end accounts of senior government accountants, have DGTCP prepare all accounting items for inclusion in the year-end consolidated accounts (CGAF) and attached to the year-end budget law. - Prepare for transition to accrual basis accounting; finalize and adopt strategy for implementation of accrual basis accounting. Analysis of the current situation - Senior government accountants do not have access to all information necessary for recording government operations. Revenue accounting methods remain unsatisfactory: previous methods endure (transmission of monthly collection “statements”), and double-entry bookkeeping is not in use. - Data from transactions for the external debt or externally financed expenditure are not systematically posted to the accounts. Accounting responsibilities across ministerial participants need detailed definition to complete and strengthen procedures. - BGC reliability improved but still shows considerable weaknesses. Specific deficiencies in the BGC as at December 31, 2011 include: - Amounts recorded in the balance show anomalies: (i) the opening balance of the budgetary accounts includes credit amounts, whereas all the balances should be zero (accounts 855.1, 856.1, 980, 984, and 99); (ii) operations in execution of the LF are shown in account 99 in an amount that does not correspond to the general budget outturn; this anomaly seems linked to payments made without prior payment order authorization and without budgetary coverage that were not reflected in the budget outturn. - Discrepancies between amounts transferred to the ACCT accounts and amounts shown in monthly statements on revenue collections. These discrepancies are recorded in accounts 475 “suspense accounts for revenues at the offices of senior government accountants.” These accounts were cleared through account 132, “Cumulative balances of operational transactions,” without substantiation of that accounting treatment. - Need to establish an internal control system for systematic verification of accounting flows during and at end of each fiscal year. - Progress in financial reporting: year-end accounts of senior government accountants, the CGAF, and a draft year-end budget law (PLR) were compiled for 2011 by legally required deadlines. However, data quality and consistency need improvement. The FY 2011 outturn shown in different documents is not always the same (the discrepancy is CFAF 73 billion). - Conclusions drawn: - Methods to calculate fiscal year outturn differ; cash and temporary operations may not be covered in the PLR. - Amount of expenditure in the PLR exceeds that in the CGAF. - Coordination weaknesses between MEF units: PLR is established by the Budget Directorate on the basis of the compte administratif, without reference to the DGTCP. - The “Procedures Manual for the Compilation of Government Year-End Accounts” being finalized could help resolve problems; extend improvements to other government bodies (local governments, in particular). - Recent decree: PGT given responsibility for all cash operations, including revenue operations for which PGT is not designated public accountant. Three senior government accountants: RGT (revenue accounts), PGT (expenditure accounts), ACCT (centralization). Impact of new structure should be evaluated: potential for increased payment delays, risk of error related to transfer entries, need to spell out liability rules for accountants. - Implementation of WAEMU Directives requires reactivated strategy for accrual basis accounting; prerequisite is enhanced reliability of existing accounting system. Recommendations to be Implemented through the Project - Review the procedures and improve the computer systems to make the books and accounts more reliable; - Pursue ongoing efforts to improve the reliability of the trial balance, in particular by developing the internal control system; - Improve the quality of the financial data reported and production of the PLR by improving coordination among the MEF staff and applying a detailed procedure; - Conduct an impact study on having the PGT take over cash operations and spell out the liability of accountants in legal framework. Selected reconciliation data (Table 11: Comparison of FY 2011 Outturns in the CGAF and the PLR) - In millions of CFA francs — CGAF / PLR / PLR/CGAF Discrepancy - General budget: revenues — 314,499 / 314,499 / - - General budget: expenditure — (354,738) / (438,873) / (84,135) - General budget outturn — (40,239) / (124,374) / (84,135) - SAC: resources — 1,831 / 1,831 / - - SAC: expenditure — (820) / (820) / - - SAC outturn — 1,011 / 1,011 / - - External resources — 101,281 / 101,281 / - - Expenditure on liquidity management operations — (7,157) / No data / 7,157 - Resources on temporary operations — 673 / No data / (673) - Expenditure on temporary operations — (3,933) / No data / 3,933 - Outturn on temporary operations — (3,260) / No data / 3,260 - 2011 budget outturn — 51,636 / (22,081) / (73,717) Additional context - CdC began reviewing year-end accounts of senior government accountants and the PLR in 2011; initial report on execution of the 2007 budget law prepared. Given weaknesses, CdC decided to work closely with the MEF and resume investigative work only as of FY 2010. Skills development and increased resources are necessary at the CdC; support to be provided by the French CdC. ### Fiscal reporting table (TOFE) Analysis of the current situation - Institutional mechanism for producing TOFE (entrusted to Economy Directorate, DE) does not cover quality control; SP-PRPF is not legislatively required to monitor TOFE quality. - DE does not produce TOFE on a regular schedule; the last TOFE available for FY 2012 presents the situation as at end-June 2012 (three months late). TOFE should be produced in the six weeks following the end of the month. - DE lacks constant dialogue with DGTCP, DF, and Public Debt Directorate to supplement and reconcile data for TOFE compilation. - Revenue side: DE uses information reported by revenue-collecting agencies instead of trial balance; discrepancies are not reconciled. - Expenditure side: data shown under some headings in TOFE differ from SIGFIP-generated data (wage bill, government-financed capital expenditure, transfers, subsidies). - Financing data are not comprehensive, making it impossible to show the net government position within the required timeframe (45 days after the reference month). - Recommendation: all government accounts within scope of general government as defined in the IMF’s GFSM (2001) should be known by the DGTCP and reported to the BCEAO. Recommendations to be implemented through the project - Identify the data sources and officials responsible for providing data for the TOFE, for communication to the DE; - Survey and report to the BCEAO all bank accounts falling within the scope of the net government position. C. FAD Support through the Project — Project objective and verifiable indicators (for accounting and reporting) - Project objective: improve quality of budget and accounting data, reporting process, and capacity of the CdC. - Verifiable indicators: a statement of compliance by the CdC and submission of the PLR to the NA at the same time as the draft LFI. Expected project outcomes - Expected outcome: improved reliability and consistency of accounting operations and enhancement of CdC capacity. - Indicators relating to government accounting and budget reporting specified; CdC indicator postponed slightly due to delayed project start. Verifiable indicators and deadlines (Table 12: Project Outcomes and Indicators) - 5.1 Government accounting and budget reporting – reliability and consistency improved. - The 2012 final accounts are closed and submitted to the CdC by end-July 2013. — July 2013 - The 2013 final accounts are closed and submitted to the CdC in 2014 in accordance with the deadlines set in the LOLF. — July 2014 - A consolidated trial balance for the government is compiled monthly. — May 2015 - 5.2 CdC – capacity improved. - The CdC has participated in training sessions on budget execution and accounting provided through the project. — As of March 2013 Operational action plan (selected activities and resources from Table 13) - FAD resident advisor responsible for managing the reforms - Facilitate and structure the flow of information among staff for production of the TOFE — As of October 2012 — 1 expert, 18 months - FAD resident advisor responsible for strengthening budget execution, accounting, and cash management - Prepare an accounting instruction on monitoring (tables, summaries, etc.) and recording of revenues (detailed chart of accounts, templates for the recording of operations, etc.) — As of October 2012 — 1 expert, 24 months - Assist in introduction of double-entry bookkeeping in the revenue-collecting agencies - Update the chart of accounts - Establish detailed procedures for production of year-end revenue and expenditure accounts, the CGAF, and the PLR: staff involved, respective roles, timetable, etc. - Support formulation of a strategy for implementation of accrual basis accounting: timetable and phases - Improve reliability of the trial balance - Prepare for closing of the 2012 accounts; Train staff of the DGTCP on closing procedures — December 2012 — 1 expert, 2 weeks - Provide support for closing of the 2013 accounts — February 2014 — 1 expert, 2 weeks - Develop an internal control mechanism and procedures — November 2014 — 1 expert, 2 weeks - Implement the new government chart of accounts - Compare the 2008 chart of accounts with the WAEMU chart of accounts; Align the chart of accounts with the Directives; Develop an implementation strategy — March 2015 — 1 expert, 2 weeks *Source: Mission document.* ### 97. The July 2011 mission had stressed the need to train ACs in the sectoral ### _cr1398 - 97. The July 2011 mission had stressed the need to train ACs in the sectoral ### Training needs and analysis - The July 2011 mission recommended preparing a training plan and procedures manuals or guides to improve the skills of the ACs. - The June 2011 FAD mission identified training needs for: - DGTCP internal and external audit teams; - SP-PRPF and the focal points in the sectoral ministries. - Analysis of the current situation: - The MEF made efforts in 2012 to improve its PFM training. - Terms of reference were prepared for a number of training modules on the implementation of the PA-RGFP, and these were to be submitted to donors for funding. - Some proposed training topics are classified as general administrative training (administrative memoranda, drafting of legislation) rather than PFM-specific. - Implementation of the WAEMU Directives should inspire the MEF to prepare a training strategy and plan covering all public reforms and sectoral ministries, preferring a module-based approach grouped by career area (budget, accounting, appropriations manager, auditor, etc.). - In a first phase, careful attention should be paid to general PFM training to ensure better understanding of PFM issues and mechanisms among those involved in the expenditure process. ### Training recommendations to be implemented through the project - Develop a training strategy and plan for implementation of the PA-RGFP and preparation for the gradual implementation of the new legal framework resulting from the WAEMU Directives; - Train staff involved in the expenditure process in the fundamentals of PFM. ### Organizational Structure of the Ministry — main prior recommendations - June 2011 mission recommendations aimed at: - integrating and merging the current and capital budget preparation functions; - creating and implementing internal audit and control functions within the MEF; - restructuring the DGTCP and installing three senior government accountants; - establishing a network of government accountants within the financial administrations. ### Analysis of the current organizational situation - A decree of March 7, 2012 changed the organization of the ministerial departments to facilitate unified budget management and clears the way for conversion of the Budget Directorate (DB) into a Budget General Directorate (DGB), leading to a merger of the current and capital expenditure budget preparation functions and unification of execution of the two budgets. - A draft decree reviewed by the mission details and clarifies the March 7, 2012 decree; positive developments include bringing existing IT functions together in an information systems directorate to strengthen management of changes to SIGFIP and other applications. - The mission recommends combining all internal audit functions in the IGF, noting that creating an internal audit unit reporting directly to the Minister would duplicate functions given IGF’s limited human resources; consolidation would enable the IGF to ensure the quality of internal control systems. - Criticisms of draft decree allocations: - Creation of an expenditure control directorate is unwarranted because the function is already carried out by the Financial Control General Directorate (FC). - Debt management is inappropriately entrusted to the DGB; according to the 2009 WAEMU Directives, debt management is a financing operation rather than a budgeting operation. Operational management of the debt should fall within the competence of the DGTCP and the DPPE (DPPE is responsible for the debt strategy). - Implementation of poverty reduction programs should come under the authority of the DPPE. - Financial reporting arrangements should be clarified: - Reporting on execution of the budget law remains with the DGB, which lacks the tools and capacity. - Compilation of the TOFE, entrusted to the DGTCP in the draft decree, could instead remain assigned to the DPPE, with support from the SP-PRPF. - Financial oversight functions appear scattered among too many general directorates: - The draft decree gives FC the mission of supervising nationalized enterprises, public corporations, semi-public corporations, and all other public entities subject to private sector-type management, which is inconsistent with the public finance control mission entrusted to the FC. - Financial oversight is shared among the DGB, the DGCTP, and the new general directorate of government assets without details on respective tasks. - Given creation of other parapublic structures (Togolese Revenue Office, AGEROUTE), the MEF should be given a dedicated unit responsible for financial oversight. - Footnote: Decree 2012-006/PR of March 7, 2012 on the organization of the ministerial departments. ### Organizational recommendations to be implemented through the project - Combine the internal audit staff and functions within the IGF; - Reclassify the debt management functions within the DGTCP, and poverty reduction functions within the DPPE; - Eliminate the provisions in the decree making FC responsible for the control of public entities subject to private sector-type management, and unify the financial oversight of the public sector. ### FAD support through the project — objectives and indicators - Project objective: capacity-building and implementation of the ministry reorganization. - MEF requirements for project success: - A training strategy and trained staff; - An organization chart that clearly defines the responsibilities of all units and the profiles required of their senior officials. ### Expected project outcomes - Expected outcome: production of the training strategy and the organization chart of the ministry. - The project will play a role in finalization of the decree related to reorganization. ### Verifiable indicators and deadlines (Table 14. Project Outcomes and Indicators) - Description of Outcomes: Training - the MEF implements a training strategy linked to the implementation of the PA-RGFP. - Verifiable Indicators: - A strategy and related action plan for building the capacity of the various staff members involved in PFM, including at the spending ministries, are approved. - The staff concerned (by each topic covered by the project) at the MEF and spending ministries have been trained by means of workshops and seminars in the areas covered by the project. - Deadline: March 2013 - Additional timing note: As of September 2013 *Source: _cr1398 - 97. The July 2011 mission had stressed the need to train ACs in the sectoral* ### 6. New decree on the organizational ### 6. New decree on the organizational structure of the MEF ### Status and immediate outputs - The MEF has a draft decree and an organization chart. - March 2013: The MEF has a training strategy that takes account of the developments necessary for institutionalizing the changes related to the WAEMU Directives. - Operational action plan: Activities implemented through the project are summarized in Table 15. ### Activities implemented through the project (from Table 15) - Reorganization of the MEF - Goal: Finalize the draft decree on the organizational structure of the MEF - Date: January 2013 - Resources: 1 expert, 2 weeks; FAD resident advisor responsible for managing the reforms - Support implementation of the recommendations resulting from the organizational audit of the MEF - Date: As of October 2012 - Resource variants listed: - 1 expert, 18 months; FAD resident advisor responsible for strengthening budget execution, accounting, and cash management - 1 expert, 24 months - Capacity-building - Goal: Formulate a training strategy and plan, incorporating the reforms resulting from the WAEMU Directives and drawing on the training modules prepared by the WAEMU Commission - Date: January 2013 - Resources: 1 expert, 2 weeks; FAD resident advisor responsible for managing the reforms - Implement the training strategy and the training plan - Date: As of October 2012 - Resources: 1 expert, 18 months - Hold training sessions on the PFM framework ### Explicit activity references appearing elsewhere in the text - Annex references and project identification: - Project financed by the European Union: Strengthening Public Financial Management (FAD_TGO_2012-3) - Activity Code: 13FAZS700 and 13FAZS600 (in Annexes for individual advisors) --- ### Terms of Reference: Advisor to the Minister of Economy and Finance — Mr. Ephrem Ghonda Makiadi ### Context and project framing - Agreement: EUD in Togo and the Fiscal Affairs Department (FAD) of the IMF signed a TA agreement for a project at the MEF to last until May 2015. - Mr. Makiadi’s mission: Help authorities manage and monitor PFM reforms, coordinate with donors; falls within the PA-RGFP for 2012–14. - Project: Strengthening Public Financial Management, FAD_TGO_2012-3. ### Mission objectives and expected outcomes (areas of support) - Management of the PFM reform - Revitalize the reform monitoring committee - Activities: Prepare for next review of the PA-RGFP (fall 2012); improve PA-RGFP monitoring reports - Outcomes: Detailed report on implementation of the PA-RGFP; Regular PA-RGFP monitoring reports - Make the PA-RGFP a reform management tool - Activities: Improve integration of the PA-RGFP with directorate action plans; establish a database of activities and recommendations of FAD, short-term experts, and West AFRITAC and arrange monitoring of performance indicators - Outcomes: Consolidated PA-RGFP and action plans; Database established (with support of an IT specialist from the MEF) - Support the reform - Activities: Suggest a communications plan on the PFM reform; Train SP-PRPF staff in reform management - Outcomes: Communications plan finalized; Training sessions held - Capacity-building in support of the reform - Activities: Implement the training strategy and plan; Hold training sessions on the PFM framework - Outcomes: Implementation of the training plan during the period covered by the terms of reference; Training sessions held - Adopt and implement the new decree on the organizational structure of the MEF - Activities: Support implementation of recommendations from the organizational audit of the MEF - Outcome: Decree adopted - Coordination with donors - Step up dialogue in inter-agency donor committee - Activities: Organize regular meetings; Map donor involvement in PFM - Outcomes: Organization of meetings over the period covered by the terms of reference; Mapping done - Structure donor support - Activities: Finalize costing of PA-RGFP activities; Establish common budget support matrix and joint review mechanisms - Outcomes: Costing done; Matrix and review mechanisms established - Strengthen monitoring of donor-funded projects - Activities: Strengthen reporting mechanisms to donors on externally financed investment projects - Outcomes: Mechanisms defined - Improvement of reporting on public finance - Improve the production of the TOFE - Activities: Facilitate and structure flow of information among units - Outcomes: Flow of information clarified and established - Improve budget execution reports - Activities: Improve quarterly budget execution reports - Outcomes: Production of reliable reports ### Positioning, logistics, and reporting - Position: Advisor to the Minister of Finance; will work closely with advisors to the Minister of Finance, Permanent Secretary, Secretary-General, general directorates and directorates; may contact other ministries and CdC as needed. - Remuneration: IMF will pay Mr. Makiadi with funds provided by the EU. - MEF to provide workspace, office supplies, telephone resources; access to budgetary and accounting applications (SIGFIP in particular). - Duration of assignment: October 3, 2012 to September 15, 2013 and may be extended for six months. - Quality control: Performed by project manager in Public Financial Management Division 2 (M2) of IMF’s FAD (Mr. Queyranne as of October 2, 2012). - Reporting: One month after taking up functions and then quarterly, submit reports in French with English executive summary to the Division Chief (Mr. Mueller as of November 16, 2012), copy to project manager and EUD project manager (Ms. Gosparini as of November 16, 2012). ### Interaction with short-term experts and other TA - Participate in preparation of TORs for short-term experts; organize their visits; monitor implementation of recommendations. - Short-term experts will be IMF HQ staff or consultants; advisor may propose changes to use of experts to FAD and inform EU where applicable. - Advisor may request additional technical assistance and will be involved in scheduling and implementation of FAD and West AFRITAC activities. - Will be informed by IMF Resident Representative in Togo (Mr. Werner Keller) of other IMF TA providers. --- ### Terms of Reference: Advisor to the Minister of Economy and Finance — Mr. Blaise Yehouenou ### Context and project framing - Agreement: EUD in Togo and FAD/IMF signed a TA agreement for a project at the MEF to last until end-May 2015. - Mr. Yehouenou’s mission: Help and support authorities in strengthening budget execution, cash management, and accounting; falls within PFM priority action plan for 2012–14. - Project: Strengthening Public Financial Management, FAD_TGO_2012-3. ### Mission objectives and expected outcomes — program coverage - The advisor supports implementation across PA-RGFP programs: - PA-RGFP Program 1: Legal framework for PFM - PA-RGFP Program 2: Improvement of mobilization of resources - PA-RGFP Program 3: Forecasting, programming, and budget execution - PA-RGFP Program 8: Improvement of government accounting system and reporting of budget execution data ### Selected activity lines and expected deliverables - PA-RGFP Program 1: Legal framework for public finance - 1.2: Draft and apply PFM implementing regulations for the WAEMU Directives - First year of assignment: - Activities: Establish a budget classification linked to the government chart of accounts - Outcome: Classification done - Second year of assignment (if applicable): - Activities: Inventory regulations, manuals, procedures; assist updating of regulations, manuals, procedures - Outcomes: Legislation, manuals, and implementation procedures prepared - 1.3: Adopt and implement the new decree on organizational structure of the MEF - First year of assignment: - Activities: Assist with implementation of recommendations from the organizational audit of the MEF in the budgetary and accounting areas - Outcome: Decree adopted - 1.12: Prepare an instruction for officials describing legal framework, electronic process for commitment, payment order authorization, and payment, and tasks under general and specific procedures - First year of assignment: - Activities: Support mission on budget execution procedures; organize monitoring of the length of time expenditure documentation stays with officials involved - Outcome: Indicators prepared for monitoring of processing times - Second year of assignment (if applicable): - Activities: Establish table for monitoring delays in expenditure process; training of ministry personnel - Outcomes: Tables compiled and updated regularly; Training done ### Assignment duration and structure - Terms cover first year of assignment and include activities for the second year for information. - Mr. Yehouenou’s terms of reference date: November 16, 2012; assignment period specified in header: (October 3, 2012 – September 15, 2013). *Source: Excerpts from the IMF Fiscal Affairs Department project documents and draft Terms of Reference for the Strengthening Public Financial Management (FAD_TGO_2012-3) project.* ### 1.15 and 1.16: (i) Support ### _cr1398 - 1.15 and 1.16: (i) Support ### PA-RGFP Program 2 — Improvement in the mobilization of resources - Actions: - 2.1.6 and 2.1.10: (i) Introduce double-entry bookkeeping for tax (DGI) and customs (DGD) revenue, as defined in the government chart of accounts; and (ii) monitor the revenues collected by units. - First year of assignment activities: - Prepare an accounting instruction on the monitoring (tables, summaries, etc.) and recording of revenues (detailed chart of accounts, templates for the recording of operations, etc.). - Assist with the introduction of double-entry bookkeeping in the revenue-collecting agencies. - First year of assignment results: - Instruction prepared. - Double-entry bookkeeping used in the revenue-collecting agencies. ### PA-RGFP Program 3 — Forecasting, programming, and budget execution - Actions and sequencing: - 3.4.1: Introduce a cash flow forecasting system. - Streamline the expenditure process. - Introduce the CUT (Compte Unique du Trésor / single treasury account). - First year of assignment activities and results: - Support the strengthening of the activity of the cash committee. - Result: Monthly reports of the cash committee. - Second year of assignment (if applicable) activities and results: - Support the preparation of annual, monthly, and weekly estimated cash plans. - Result: Reliable estimated cash plans prepared annually, monthly, and weekly. - Implement the proposals for improvements in the expenditure process (including payment delays). - Result: Reduction of payment delays. - Support actions to close government bank accounts. - Result: CUT in effect. ### PA-RGFP Program 8 — Improvement of the government accounting system and reporting of budget execution data - Actions: - Improve the reliability of the financial data. - Prepare for conversion to accrual basis accounting (WAEMU Directive). - First year of assignment activities and results: - Update the chart of accounts. - Result: Chart of accounts updated. - Establish detailed procedures for the production of year-end accounts, the CGAF, and the PLR: staff involved, respective roles, timetable, etc. - Training. - Result: Procedure established and reliability of the 2013 financial data improved: PLR and CGAF consistent with each other. - Second year of assignment (if applicable) activities and results: - Support the implementation of an internal control system; training. - Result: Implementation of the internal control system; 2014 financial data validated by the CdC. - Assist with the development of an implementation strategy for conversion to accrual basis accounting: timetable and phases. - Result: Strategy formulated. ### Advisor positioning, resources, and assignment details - Positioning: - Mr. Blaise Yehouenou will perform the functions of advisor to the Minister of Finance. - He will work closely with the advisors to the Minister and the staffs of the Permanent Secretary, the Secretary-General, and all the MEF general directorates and directorates; as needed and keeping the minister informed, he will make contact with the other ministries and the CdC. - Remuneration and physical resources: - The IMF will pay Mr. Blaise Yehouenou with funds provided by the EU. - The MEF will provide the advisor with a workspace, office supplies, and telephone resources appropriate for the exercise of his functions. - Mr. Blaise Yehouenou must have access to the accounting applications (SIGFIP, in particular) and the operational applications in the MEF general directorates and directorates, if necessary. - Duration: - Assignment will last from October 3, 2012 to September 15, 2013 and may be extended for a year. - Quality control and reporting: - Quality control performed by the project manager in the Public Financial Management Division 2 (M2) of the IMF’s Fiscal Affairs Department (Mr. Queyranne as of November 16, 2012). - One month after taking up his functions and then quarterly, Mr. Blaise Yehouenou will submit to the Division Chief (Mr. Mueller as of October 2, 2012), with copy to the project manager, reports written in French, each preceded by an executive summary in English, describing his activities and the outcomes achieved. - These reports will also be sent, for information, to the project manager at the European Union Delegation in Togo (Ms. Gosparini as of October 2, 2012). - The advisor may at any time seek technical support from the Fiscal Affairs Department of the IMF. - A mission from IMF headquarters will review the outcomes achieved throughout the project in 2013. ### Linkages with other project activities and TA - Collaboration and coordination: - Mr. Blaise Yehouenou will collaborate with Mr. Ephrem Ghonda Makiadi on the preparation of draft terms of reference for short-term experts, participate as needed, and monitor application of their suggestions in his areas of input. - Short-term experts will be either staff from IMF headquarters or consultants. - The advisor may make suggestions for changing the use of these experts to FAD, which will inform the EU, and may express the need for additional technical assistance. - He will be involved in the scheduling and implementation of the activities of the FAD and West AFRITAC projects in public expenditure management. - The advisor will be informed by the office of the IMF Resident Representative in Togo (Mr. Werner Keller) of any other TA providers from the IMF on mission in Lomé or posted there, and will make contact with them, if necessary. ### Annex 3 — Draft schedule of project outcomes (selected verifiable indicators and completion dates) - 1.1. PA-RGFP — Roadmap and monitoring system: - A detailed roadmap with a monitoring system (indicators and targets) for implementation of the PA-RGFP is finalized by the MEF. — September 2013 - The PA-RGFP is supported by a performance monitoring system. — June 2013 - The costs of implementing the PA-RGFP are assessed for at least a three-year period. — March 2013 - An annual action plan highlighting the priority measures and expected outcomes for the year is prepared at regular intervals. — As of December 2012 - 1.2. PA-RGFP — Institutional framework operational: - Units and persons responsible for implementation and monitoring submit results regularly in the sectoral committee; staff responsible trained; working groups fully operational; quarterly reports prepared; joint sectoral reviews conducted once every six months. — As of December 2012 - Regulatory and institutional framework — Preparation for WAEMU Directives: - Senior officials aware of changes introduced by the PFM reform and WAEMU Directives. — September 2013 - Roadmaps ready for medium-term planning of implementation of the Directives in project areas. — September 2013 - Assessment of changes needed to enable SIGFIP to take account of the WAEMU Directives environment. — September 2014 - 3.1. Budget execution — Procedures improved: - Internal and external controls and diagnostics show broadly acceptable application of the new legal and regulatory framework. — March 2015 - Expenditure process streamlined, with specific targets: - Time between submission of procurement documentation to the DNCMP and delivery of its non-objection decision reduced from the current 75-90 days to a maximum of 20 days, compared with the 15 days indicated in the legislation. — December 31, 2014 - Time that expenditure documentation should stay with officials specified and monitored as per the decree of April 20, 2011. — March 2015 - Payment order authorization devolved in at least three of the main spending ministries; these ministries apply rules in manuals on budget execution and accounting procedures. — March 2015 - 3.2. Cash management — Improvements and outputs: - A coherent annual cash management plan with a breakdown by month is compiled regularly. — End-2013 - The cash management institutional framework created by MEF decrees is operational and produces regular reports at all levels. — As of September 2013 - PPMs, together with information on commitments and payments, are compiled by the main spending ministries. — End-2013 - An annual plan for short-term borrowing (treasury bills and bonds), consistent with the annual cash management plan, is prepared and adopted by the MEF, along with the annual cash management plan. — May 2015 - 3.3. Single treasury account (CUT) — Restoration at the central bank: - Inventory of accounts maintained at commercial banks by government entities updated once every six months. — As of December 2013 - A strategy and an action plan are adopted for the establishment of the CUT. — End-2014 - 4. Training — MEF training strategy linked to PA-RGFP: - A strategy and related action plan for building capacity of officials involved in PFM, including at spending ministries, are approved. — March 2013 - Staff at the MEF and at the spending ministries trained by means of workshops and seminars in project areas. — As of September 2013 - 5.1 Government accounting and budget reporting — Reliability improved: - The 2012 final accounts are closed and submitted to the CdC in 2013, by end-June 2013. — July 2013 - The 2013 final accounts are closed and submitted to the CdC in 2014, in accordance with the deadlines established by the LOLF. — June 2014 - A consolidated balance of the government accounts is prepared on a monthly basis. — May 2015 - 5.2 Audit Office (CdC) — Capacity enhanced: - CdC staff have participated in training sessions on budget execution and accounting provided in the context of the project. — As of March 2013 - 6. New decree on organization of the MEF: - The MEF has a draft decree and an organization chart. — March 2013 - The MEF has a training strategy that takes account of developments necessary for institutionalizing changes related to the WAEMU Directives. — March 2013 *Source: _cr1398 - 1.15 and 1.16: (i) Support (IMF project document).* --- _Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2013/_cr1398.pdf_