Public Disclosure Copy The World Bank Implementation Status & Results Report Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) EAST ASIA AND PACIFIC | Mongolia | Governance Global Practice | Recipient Executed Activities | Investment Project Financing | FY 2016 | Seq No: 4 | ARCHIVED on 04-Jan-2018 | ISR31123 | Implementing Agencies: Mongolia National Audit Office, Ministry of Finance Key Dates Key Project Dates Bank Approval Date:22-Jan-2016 Effectiveness Date:04-Feb-2016 Original Closing Date:30-Aug-2018 Revised Closing Date:30-Aug-2018 Project Development Objectives Project Development Objective (from Project Appraisal Document) The main objective of the proposed project is to strengthen MNAO’s capacity, primarily in financial audit and audit firm contracting and oversight. To achieve this objective a comprehensive and systematic continuing professional development strategy together with a time-bound action plan that is needs-driven, tailored and sustainable will be developed and implemented. For this purpose, the current capacity strengths and gaps in financial audit and related areas will be independently assessed by a peer SAI. In parallel to this assessment, MNAO personnel will be surveyed and participate in focus groups to identify their requests for and perceptions of their professional development needs and alternative means to achieve these objectives. The results of the financial audit peer review and the knowledge and learning needs assessment to be carried out under this proposed project, as well as the 2010 performance audit peer review, will feed into development of a CPD strategy for the institution that will then be developed into a 3-year knowledgeand learning program. Furthermore, as part of the project, tailored training materials will be developed and actual training will be delivered to MNAO staff as per the CPD strategy and the knowledge and learning program. While the specific content and depth of topics to be covered under the CPD program are largely to be identified and tailored as per the assessments to be carried out,an early indication of capacity gaps reveals such areas as MNAO staff’s knowledge and understanding of the relevant standards, i.e. IPSAS and the newly translated ISSAIs, quality control, contracting and quality assurance of private audit firm engagements, and audit of the consolidated financial statements of the Government. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Satisfactory  Satisfactory 1/4/2018 Page 1 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) Overall Implementation Progress (IP)  Satisfactory  Satisfactory Implementation Status and Key Decisions The project has 5 main activities and a brief status update for each of the activities is provided below: Activity 1 has been fully completed with the MNAO peer review report by the UK NAO finalized and quality reviewed by the International Donor Initiative (IDI) of the International Organization of Supreme Audit Institutions (INTOSAI) that developed the methodology for reviewing performance of Supreme Audit Institutions. The final quality assured peer review report was delivered on July 15, 2017. Activity 2 has also been completed. MNAO carried out the training needs assessments at various levels of the organization e.g. central and local branches. Relevant surveys and focus group discussions took place in January and a final report on results of the training needs assessment was submitted to the Bank in March 2017. Activity 3 on developing a strategy of sustainable continuing professional training program has also been completed. Draft Learning and Development documents including a strategy, a program and a detailed plan prepared with support from an international consulting firm was reviewed and commented by the management of MNAO and was subsequently finalized and approved on September 19, 2017 by the order no. A/164 of the Auditor-General of Mongolia. Activity 4 on delivering priority training under the CPE strategy and action plan has commenced and so far the following training has been organized: a) 5 regional training were organized in fall 2017 and 334 staff members out of the total of 365 (91.5 percent) participated – the refresher training covered areas for improvement identified by the peer review e.g. consideration of fraud, determination of materiality, utilization sampling methods in auditing and correlation analysis etc.; b) In September, 2017, a 5-day training for trainers was organized for 36 staff members of MNAO to help enhance their soft skills and pedagogical skills; c) to facilitate rolling out of an online learning facility that would connect the aimag offices with MNAO, in December training was organized for the MNAO, UB city and aimag audit office representatives on how to install the relevant equipment purchased under the project and how to connect and use the online facility. For the period until project closing on August 30, 2018, the MNAO will continue organizing priority training under this activity. Activity 5 on developing a transparent and documented procedure for outsourcing audits to private audit firms was also completed. With support from a local consultant, MNAO developed a “Regulation on selection, contracting, and evaluation of independent audit entities to conduct audit of financial statements, and monitoring the quality of performed audits” and obtained approval by the order no. A/191 of the Auditor-General on October 26, 2017. MNAO is carrying out selection of auditors for the FY2017 outsourced audits using the new regulation. Overall, the project implementation is on track and remain satisfactory. Risks Overall Risk Rating Risk Category Rating at Approval Previous Rating Current Rating Overall  --  Moderate  Moderate 1/4/2018 Page 2 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) Comments There are no changes to the project risk rating. The project needs to ensure that all remaining project activities are undertaken timely towards full utilization of the project funds. Results Project Development Objective Indicators PHINDPDOTBL MNAO has made demonstrable progress in implementing the targeted improvements which emerge from the financial audit peer review (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 25.00 Date 11-Jan-2016 26-Jun-2017 26-Jun-2017 31-Aug-2018 Comments The MNAO has developed a matrix of recommendations from the peer review identifying the responsible unit for implementation and the proposed timeline for completion (starting with due dates by November 2017 through to the end of 2018). The task team is aware that there are already items that have progressed well and will formally take stock by the time of the next ISR. PHINDPDOTBL MNAO auditors have been trained in the priority areas identified by the CPD strategy and action plans (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 -- 91.50 50.00 Date 11-Jan-2016 -- 28-Dec-2017 31-Aug-2018 Comments The MNAO has already started organizing training under the project that is identified as priority. There will be numerous training events already organized and to be organized under the training. The regional training organized in fall 2017 by MNAO in the 5 regions already covered 91.5 percent of the staff cohort. PHINDPDOTBL MNAO has utilized a strengthened procedure for selection of private audit firms contracted to conduct audits of government entities (Yes/No, Custom) 1/4/2018 Page 3 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) Baseline Actual (Previous) Actual (Current) End Target Value N N N Y Date 11-Jan-2016 27-Jun-2017 27-Jun-2017 31-Aug-2018 Comments The regulation was just approved in October 2017. The MNAO is currently in the process of selecting private audit firms using the new procedure for FY17 audits. The result will be formally recognized in the next ISR. Overall Comments Intermediate Results Indicators PHINDIRITBL Apeer review report including recommendations for improvement of MNAO’s financial audit capabilities submitted (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N Y Y Y Date 11-Jan-2016 27-Jun-2017 27-Jun-2017 31-Jan-2017 PHINDIRITBL Report on MNAO training needs assessment (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N Y Y Y Date 11-Jan-2016 27-Jun-2017 27-Jun-2017 30-Jun-2017 1/4/2018 Page 4 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) PHINDIRITBL CPD strategy and an action plan have been developed and adopted (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- Y Y Date 11-Jan-2016 -- 19-Sep-2017 31-Aug-2017 PHINDIRITBL Materials developed for 50% of the courses included in the CPD action plan (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 -- 0.00 50.00 Date 11-Jan-2016 -- 28-Dec-2017 31-Jan-2018 Comments The course materials are being developed as MNAO goes along with the individual training event organization. So far, all training planned for 2017 have been organized successfully. The indicator will be better measured as the task team approves the 2018 training plan for the project. PHINDIRITBL Selection procedure for private audit firms that would perform contracted audits developed (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- Y Y Date 11-Jan-2016 -- 26-Oct-2017 30-Jun-2017 Overall Comments Data on Financial Performance Disbursements (by loan) 1/4/2018 Page 5 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Capacity Building for MNAO through Establishing a Countinuing Professional Development Strategy and Program (P155305) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P155305 TF-A1838 Effective USD 0.38 0.38 0.00 0.21 0.17 55% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P155305 TF-A1838 Effective 22-Jan-2016 04-Feb-2016 04-Feb-2016 30-Aug-2018 30-Aug-2018 Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 1/4/2018 Page 6 of 6 Public Disclosure Copy