World Bank avails US$20 million for public finance management improvements
VICTORIA FALLS – The World Bank has availed a US$20 million grant to assist Zimbabwe in improving its Public Finance Management System.
Speaking at the just ended Association of Chartered Certified Accountants (ACCA) regional public sector governance and internal control conference, World Bank Senior Financial Management Specialist, Daniel Yaw Domelevo said the Public Financial Management Enhancement Project is expected to commence before year end.
“We have availed a US$20 million grant for the Public Financial Management Enhancement Project which will assist government in improving its financial reporting through installing new models of the software that they have been using. The grant is also aimed at improving internal audit so that they can check the control systems in place to see whether people are complying with the requirements of financial management and the law,”
Beyond this, he said the World Bank will also help the office of the auditor general to perform its function and assist government departments to improve its auditing skills. He said the World Bank will further assist parliament in capacity building so that members have a better appreciation of audit reports. The program will also be extended to local government and city councils around the country.
He said the only way that government and local authorities can improve their reporting in the near future is to go the Public Private Partnership (PPP) route as the private sector possesses skills that are devoid in government structures.
He called on government to migrate from the crude cash based accounting to accrual based accounting which shows a better reflection on public finance performance. According to the International Federation of Accounts (IFAC), no government can be considered transparent until they adopt accrual based accounting.
Domelevo said Africa is lagging behind in adoption of accrual accounting as compared to other regions.
“Governments must implement the necessary institutional arrangements required to enhance public sector financial management transparency and accountability.
An integral and essential part of these arrangements is the use of accrual-based accounting—through the adoption and implementation of International Public Sector Accounting Standards (IPSASs), which promotes greater transparency and accountability in public sector finances and allows for enhanced monitoring of government debt and liabilities for their true economic implications,” he said.
He said transparency can help attract cheaper international credit while capacity in fiscal matters contributes significantly to the suffering being felt directly by the citizens of the crisis-stricken countries. FinX