The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) Project to Strengthen budget execution and financial reporting systems (P163131) EAST ASIA AND PACIFIC | Marshall Islands | Governance Global Practice | IBRD/IDA | Investment Project Financing | FY 2018 | Seq No: 2 | ARCHIVED on 30-May-2019 | ISR36321 | Implementing Agencies: Ministry of Finance, The Republic of the Marshall Islands Key Dates Key Project Dates Bank Approval Date: 30-May-2018 Effectiveness Date: 01-Oct-2018 Planned Mid Term Review Date: 29-Jan-2021 Actual Mid-Term Review Date: -- Original Closing Date: 25-Sep-2023 Revised Closing Date: 25-Sep-2023 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The objective of the project is to improve the completeness, reliability and timeliness of Government’s annual financial statements, and the availability of reliable socioeconomic statistics. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Strengthening the Public Financial Management Environment:(Cost $0.50 M) Financial Management Information System (FMIS):(Cost $4.48 M) Change Management and Human Resource Development:(Cost $0.97 M) Household Income and Expenditure Survey (HIES) Implementation:(Cost $0.65 M) Project Management:(Cost $2.40 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions The project financing agreement was countersigned July 18, 2018 and the project became effective on October 1, 2018. A successful Project Launch took place in Majuro on November 29, 2018, led by the government and attended by the World Bank, Regional Vice-President. Recruitment of a Project Manager is critical to ensure effective implementation. The initial procurement for a Project Manager position was unsuccessful and the Ministry of Finance, Banking and Postal Services (MoF) has recommenced the recruitment process, with the position expected to be filled mid-June 2019. A consulting firm has been selected to conduct the System Requirement Study (SRS) for the key Financial Management Information System (FMIS) component and contract negotiations are currently taking place with a view to commencing the SRS within the next two months. It is 5/30/2019 Page 1 of 7 The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) recommended that the governments of the Republic of the Marshall Islands and the Federated States of Micronesia (& Palau) continue their efforts to pursue agreement for a joint Financial Management Information System solution. The implementation of most of the project components has been delayed pending the appointment of a Project Manager. Aligning the legal, regulatory and operating environment – the scope of work for the SRS will cover a Paper on Accounting and Reporting Framework Compliance and Business Process Design and Chart of Accounts. Change Management – The PFM Working Group has been setup and the strategy is to engage a change management specialist who will work with the Project Implementation Unit (PIU), a Communications Specialist, and the Reform Coordinating Unit (RCU) to facilitate an iterative process for developing and implementing workplans, while strengthening teams in working together to achieve the project objectives. Human Resource Management component - Terms of reference for PFM Competency Framework that will specify minimum skillsets required for PFM related jobs across government that will be used for recruitment and training to build gender-balanced workforce are being developed. The expectation is to collaborate with the College of Marshall Islands (CMI) and the University of South Pacific (USP)-Majuro campus to ensure in- country sustainability of the PFM education program. Household Income and Expenditure Survey (HIES) Implementation - this component is implemented by the Economic Policy, Planning and Statistics Office (EPPSO). The recruitment of two key positions for the HIES (a local Project Officer and an international Resident Advisor) took longer than anticipated and only the Resident Advisor will be onboard by end May 2019. This will delay the commencement of field work, as the Resident Advisor will need to develop the field work plan . The Secretary, Ministry of Finance, Banking and Postal Service (MoF) will closely monitor the Division of International Development Assistance (DIDA) to complete the outstanding procurement packages and supervise the consultants for timely delivery of their outputs so that the project can get on track in meeting the development objectives. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Moderate Moderate Moderate Macroeconomic Moderate Moderate Moderate Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Sustainability Substantial Substantial Substantial Fiduciary Substantial Substantial Substantial Environment and Social Low Low Low Stakeholders Moderate Moderate Moderate Other -- -- -- Overall Substantial Substantial Substantial Results PDO Indicators by Objectives / Outcomes To improve the completeness, realiability and timeliness of Government’s annual financial statements IN00680644 ►PDO-1: Completeness, quality and timeliness criteria met for Annual Financial Statements by MoF (Text, Custom) 5/30/2019 Page 2 of 7 The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) Baseline Actual (Previous) Actual (Current) End Target Single audit submission AFS for FY2022 Not applicable - deadline (9 months after submitted for audit by Value -- monitors annual year-end) not met Dec 31, 2022 progress Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 IN00680686 ►PDO-3: New FMIS used for preparation of budget and recording of revenue and expenditure transactions (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target New FMIS used for Not applicable - recording revenue and Accounting software 4- monitor bi-annual expenditure Value Gov in use but being -- progress for design transactions and phased out and implementation of preparation of budget new FMIS for FY2024 Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 31-Jul-2023 To improve the availability of reliable socioeconomic statistics IN00680645 ►PDO-2: Production, publication of statistical abstract featuring key findings from the HIES (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Not applicable - monitors annual Statistical abstract No HIES data available Value -- progress in HIES featuring key findings since 2002 preparation and from HIES published implementation Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 31-Mar-2021 Intermediate Results Indicators by Components Strengthening the Public Financial Management Environment IN00680687 ►IR-1: Procedures Manual updated with detailed guidance (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Procedures Manual in place with detailed guidance for budget Manual available but formulation, lacking detailed Value -- No change accounting, internal procedures for all controls, payroll, fixed functions assets, cash management and financial reporting Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 31-Mar-2022 IN00680691 ►IR-2: New chart of accounts adopted to facilitate management, financial and statistical reporting (Text, Custom) 5/30/2019 Page 3 of 7 The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) Baseline Actual (Previous) Actual (Current) End Target “D” score in 2012 PEFA PI-5; economic classification used for New COA meets execution and reporting, Value -- No change criteria for "A" score for but not for preparation PI-4 and appropriation. No functional or sub- functional classification. Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Dec-2020 IN00680694 ►IR-3: Update to Public Procurement Code and Implementation Guidance issued (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Updated Public Code in need of update Procurement Code Value and no implementation -- No change and IRR in use for guidance available public procurement Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 Financial Management Information System IN00680688 ►IR-4: Financial data integrity achieved to meet “B” score for PI-27 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target “D” score in 2012 PEFA PI-22. Bank account reconciliation and Criteria for “B” score Value -- No change clearance of suspense for PI-27 fully met and advance accounts delayed and incomplete Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 31-Dec-2022 IN00680692 ►IR-5: In-year budget reports prepared and published by MoF to meet PEFA Framework “B” score of PI-28 (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target In-year budget reports prepared and cleared for publication on MoF In-year budget reports website meeting Value not prepared and not -- No change criteria for timing, published accuracy, coverage and comparability to meet criteria of “B” score for PI-28 Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 Change Management and Human Resource Development IN00680689 ►IR-6: Competency framework with gender targets adopted for PFM related jobs across govt (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target 5/30/2019 Page 4 of 7 The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) Competency framework specifying minimum skillsets required adopted for No competencies for PFM related jobs PFM related roles Value -- No change across government defined. Gender targets and used for not identified. recruitment and training to build gender-balanced workforce Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 IN00680693 ►IR-7: Number of staff completing external training programs in PFM related disciplines (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 50.00 Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Sep-2023 IN00680695 ►IR-8: Gender-sensitive communications conducted for the project for awareness and building ownership (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target MoF website enhanced and No communication regularly updated with strategy; regular updates information for Value and information not -- No change government staff and released for government citizens with staff and citizens. functionality developed for capturing and summarizing feedback. Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 IN00680696 ►IR-9: Transparency and citizen engagement in budget preparation and execution (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target MoF website includes functionality to capture citizen feedback. Information on budget preparation stages, final budget and quarterly updates on MoF website exists but budget execution does not provide platform posted regularly Value -- No change for receiving citizen including: feedback. a) Summary presented in a citizen-friendly format understandable by non-technical audience; b) Summary of citizen feedback received and government response Date 30-Apr-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 IN00680697 5/30/2019 Page 5 of 7 The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) ►IR-10: Training plan developed to meet standards set in competency framework and address skills gaps (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Training plans in place Value No training plans in place -- No change for MoF staff Date 29-Jun-2018 22-Aug-2018 30-Apr-2019 31-Jan-2022 IN00680698 ►IR-11: Number of external training program partnerships for certification and degree courses in PFM (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Four (4) external training program No external training partnerships for Value program partnerships in -- No change certification and place degree courses in PFM related disciplines Date 30-Jun-2018 22-Aug-2018 30-Apr-2019 30-Jun-2023 Household Income and Expenditure Survey (HIES) Implementation IN00680690 ►IR-12: Household Income and Expenditure Survey (HIES) fieldwork and data cleaning completed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Not applicable - monitors annual HIES data cleaning HIES not conducted Value -- progress in HIES completed and since 2002 preparation and documented implementation Date 30-Jun-2018 22-Aug-2018 30-Apr-2019 31-Dec-2020 Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P163131 IDA-D3220 Effective USD 9.00 9.00 0.00 0.33 8.30 3.8% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P163131 IDA-D3220 Effective 30-May-2018 18-Jul-2018 01-Oct-2018 25-Sep-2023 25-Sep-2023 Cumulative Disbursements 5/30/2019 Page 6 of 7 The World Bank Implementation Status & Results Report Project to Strengthen budget execution and financial reporting systems (P163131) Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 5/30/2019 Page 7 of 7