The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) LS-PFM Reform Support Project (P143197) AFRICA | Lesotho | Governance Global Practice | IBRD/IDA | Investment Project Financing | FY 2014 | Seq No: 8 | ARCHIVED on 04-Jan-2019 | ISR35019 | Implementing Agencies: Ministry of Finance, Ministry of Finance Key Dates Key Project Dates Bank Approval Date: 06-Feb-2014 Effectiveness Date: 25-Jul-2014 Planned Mid Term Review Date: 08-Apr-2016 Actual Mid-Term Review Date: 24-May-2016 Original Closing Date: 03-Jul-2017 Revised Closing Date: 03-Jun-2019 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective (PDO) is to improve the quality and timeliness of public financial management information in support of the Government’s PFM Reform Action Plan (PFMRAP) to improve budget execution. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Support for improving the stability and reliability of exisitng IFMIS:(Cost $0.53 M) Support for modernization of IFMIS platform:(Cost $2.94 M) Support for change management, training and project management:(Cost $1.51 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions Government has been advised to deepen its oversight and support for the remaining key actions that have a direct bearing on further improving implementation performance, and achievement of the development objective. These are: 1. Initial operational acceptance of the upgraded IFMIS. The upgraded software has been loaded on the existing IFMIS servers, and initial configuration is underway. Failure to complete the activity by end January will however put achievement of the PDO indicators at risk. It was therefore agreed to retain and amend the date for completion of this key action to end January 2019. A further issue regarding the configuration of the new IFMIS is the creation of control accounts for public debt as recorded and managed through CS-DRMS. Without such control accounts in the upgraded IFMIS the information about financial assets and liabilities will be incomplete, with the consequence that the financial position of the Consolidated Fund will not be obtainable from one reconciled data source, i.e. IFMIS. This matter was 1/4/2019 Page 1 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) discussed during the Integrated Reform Steering Committee (IRSC) meeting of December 10, 2018, and agreement was reached that the necessary control accounts need to be configured, with the required interfacing and reconciliation of transactions between the upgraded IFMIS and CS-DRMS (new key action). 2. Change management and training plans resourced and initiated. Although these were resourced and initiated, a new issue arose and was reported at the IRSC meeting of December 10, 2018 – the IFMIS project team has difficulty in getting Principal Secretaries arranged for sensitization and training on the upgraded IFMIS. The Minister of Finance agreed to provide an update on the project through Cabinet and to assist in securing dates for the requisite training for PSs to perform their IFMIS roles, and in general to perform their financial management tasks using IFMIS. 3. Conclude contracting for the upgraded IFMIS servers and end-user equipment. These activities are no longer considered to be on the critical path for the planned go-live of the upgraded IFMIS on April 1, 2018, but will affect achievement of the following Intermediate Results Indicators if not achieved by the revised dates as agreed - (i) #6 - IFMIS servers upgraded; new target date March 15, 2019; and (ii) #7 – End-user equipment upgraded; new target date May 15, 2019. 4. Agree on the process to validate opening balances for financial assets and liabilities for take-on in the upgraded IFMIS. The upgraded IFMIS will require opening balances for financial assets (especially the Treasury main bank accounts) and liabilities when it goes live (planned for 1 April 2019). It is recommended that a specific process be agreed with the Auditor-general to validate such key opening balances in the new IFMIS. Regarding disbursement - the project is now in the phase of work where the large contracts for the software vendor is under full execution, and contracts for servers and workstations are close to finalization, with delivery expected during the quarter to end March 2019. This is estimated to increase disbursement to at least 71% by end-March 2019. The key activities to ensure go-live by 1 April 2019 of the upgraded IFMIS are underway and the team will closely monitor execution over the coming months. There will also be more regular scrutiny by the project governing structures, under direct control of the Minister of Finance. 1/4/2019 Page 2 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating 1/4/2019 Page 3 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) Political and Governance -- Substantial Substantial Macroeconomic -- Substantial Substantial Sector Strategies and Policies -- Moderate Moderate Technical Design of Project or Program -- Moderate Moderate Institutional Capacity for Implementation and Sustainability -- Substantial Substantial Fiduciary -- Moderate Moderate Environment and Social -- Low Low Stakeholders -- Moderate Moderate Other -- -- -- Overall -- Substantial Substantial Results PDO Indicators by Objectives / Outcomes To improve the quality of public financial management information IN00615065 ►1. Improved reliablity of in-year budget execution reports from IFMIS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Steps have been taken Steps have been taken by Government to by Government to improve the reliability improve the reliability of of data in the IFMIS, In-year budget data in the IFMIS, including execution reports from In-year budget execution including operationalization of the upgraded IFMIS reports from IFMIS are operationalization of new new TSA expenditure have no material generally considered not TSA expenditure bank bank accounts and concerns regarding to be reliable, due to lack accounts and their Value their reconciliation with data reliability, since of bank accounts reconciliation with the the CBL, and initiation month-end closures reconciliations and no CBL, and piloting of of month-end closing are operational and month-end closing of the month-end closing procedures for the TSA bank IFMIS. procedures for the IFMIS. IFMIS. In-year budget reconciliations are In-year budget execution execution reports have done monthly. reports have been been developed, but developed, but are not are not yet published yet published on the web. on the web. Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 IN00615102 ►3. Stock of expenditure arrears available in IFMIS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target IFMIS data on the IFMIS data on the stock stock of expenditure Stock of expenditure There is no IFMIS data of expenditure arrears arrears will only be arrears is available Value on the stock of will only be available available when the online in the upgraded expenditure arrears. when the upgraded upgraded IFMIS goes IFMIS. IFMIS goes live. live. 1/4/2019 Page 4 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 IN00615103 ►4. New Treasury Single Account (TSA) bank balances in the IFMIS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target New TSA recurrent New TSA recurrent and and development New TSA bank development expenditure expenditure bank No new TSA balances accounts are bank accounts are in accounts are in Value are available in the operational and carried operation since October operation since IFMIS. forward into the 10, 2017, and is being October 10, 2017, and upgraded IFMIS. reconciled with the CBL. is being reconciled with the CBL. Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 To improve the timeliness of public financial management information IN00615101 ►2. Improved timeliness and completeness of annual financial statements (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Government eradicated the backlog Government eradicated of annual financial the 3-year backlog of statements, and the annual financial Three-year backlog in consolidated annual statements, and the the preparation of annual financial statements consolidated annual The FY2018/19 annual financial statements - for 2017/2018 were financial statements for financial statements for 2008/09, 2009/10, and submitted within the 2016/2017 were budgetary central 2010/11. IFMIS data to legal timeframe to the submitted within the legal government under support annual financial Office of the Auditor- Value timeframe to the Office of preparation and statements for budgetary general. The current the Auditor-general. contain data from the central government lacks IFMIS continues to IFMIS continues to lack upgraded IFMIS on all balances for financial lack complete complete balances for financial assets and assets and financial balances for financial financial assets and financial liabilities. liabilities. assets and financial financial liabilities to liabilities to support support annual financial annual financial statements for budgetary statements for central government. budgetary central government. Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 Intermediate Results Indicators by Components Support for improving the stability and reliability of exisitng IFMIS IN00615106 ►3. IFMIS users trained (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 40.00 65.00 65.00 80.00 1/4/2019 Page 5 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 IN00615107 ►4. Line ministry revenue transactions not captured in the IFMIS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Non-tax revenues collected by line Bank reconciliation of Bank reconciliation of Non-tax revenue ministries are not revenue transactions revenue transactions transactions are routinely captured in the since 2009 for all key since 2009 for all key recorded reliably in the Value IFMIS, and there is Ministries have been Ministries have been IFMIS, supported by ineffective monitoring at completed through to end completed through to timely bank Treasury to ensure that September 2017. end September 2018. reconciliations. this happens. Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 IN00615108 ►5. Business process review completed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Business process review Business process review Business process Business process to support configuration to support configuration review to support review to support Value of the new version of of the new version of configuration of the configuration of the IFMIS contracted by not IFMIS substantially new version of IFMIS new version of IFMIS yet started complete. completed. completed Date 23-Jun-2017 14-May-2018 23-Nov-2018 03-Jun-2019 IN00615112 ►9. Initial operational acceptance of the upgraded IFMIS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target CBMS configured, and business process review Initial operational IFMIS upgrade Initial configuration of substantially completed. acceptance of the Value contracted but not yet IFMIS financials in Vendor team reviewing in upgraded IFMIS started process. order to do initial achieved configuration. Date 23-Jun-2017 14-May-2018 23-Nov-2018 03-Jun-2019 Support for modernization of IFMIS platform IN00615104 ►1. Improved wide-area network uptime (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 71.42 97.50 98.00 98.50 Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 IN00615105 ►2. Improved IFMIS server uptime (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 92.86 97.80 98.20 98.50 Date 30-Nov-2012 14-May-2018 23-Nov-2018 03-Jun-2019 1/4/2019 Page 6 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) IN00615109 ►6. IFMIS servers upgraded (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Bidding for servers for Direct contracting of Servers for new Servers for new new upgraded version of servers from STCL Value upgraded version of upgraded version of IFMIS launched on June approved on October IFMIS not yet procured IFMIS operational 6, 2018 31, 2018. Date 23-Jun-2017 06-Jun-2018 31-Oct-2018 03-Jun-2019 IN00615111 ►7. End-user equipment upgraded (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Bidding for end-user Contract for end-user End-user equipment to equipment to operate End-user equipment work stations awarded Value operate upgraded IFMIS upgraded IFMIS upgraded to work on and first batch of 100 not yet procured launched on June 6, new IFMIS delivered. 2018 Date 23-Jun-2017 06-Jun-2018 30-Nov-2018 03-Jun-2019 Support for change management, training and project management IN00615110 ►8. Change management plan initiated (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Change management Change management Change management and training plan Change management Value plan developed and plan not yet developed developed and plan delivered initiated initiated. Date 23-Jun-2017 14-May-2018 23-Nov-2018 03-Jun-2019 Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P143197 IDA-53550 Effective USD 5.50 5.50 0.00 2.24 2.79 45% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P143197 IDA-53550 Effective 06-Feb-2014 24-Feb-2014 25-Jul-2014 03-Jul-2017 03-Jun-2019 Cumulative Disbursements 1/4/2019 Page 7 of 8 The World Bank Implementation Status & Results Report LS-PFM Reform Support Project (P143197) Restructuring History Level 2 Approved on 30-Jun-2017 Related Project(s) There are no related projects. 1/4/2019 Page 8 of 8