I. Credibility of the Budget
Scores by Dimension
Overall Indicator Score
1. Aggregate expenditure out-turn compared to original approved budget
A
Notes:
1.1 The difference between actual primary expenditure and the originally budgeted primary expenditure (i.e. excluding debt service charges, but also excluding externally financed project expenditure)
A
Notes:
In no more than one out of the last three years has the actual expenditure deviated from budgeted expenditure by an amount equivalent to more than 5% of budgeted expenditure (P. 16)
2. Composition of expenditure out-turn compared to original approved budget
C+
Notes:
2.1 Extent of the variance in expenditure composition during the last three years, excluding contingency items (the methodolodgy to rate this dimension is set out in the footnote of the PFM PMF booklet)
C
Notes:
Variance in expenditure composition exceeded 15% in no more than one of the last three years (P. 17)
2.2 The average amount of expenditure actually charged to the contingency vote over the last three years
A
Notes:
Actual expenditure charged to the contingency vote was on average less than 3% of the original budget (P. 17)
3. Aggregate revenue out-turn compared to original approved budget
C
Notes:
3.1 Actual domestic revenue collection compared to domestic revenue in the originally approved budget
C
Notes:
Actual domestic revenue was between 92% and 116%of budgeted domestic revenue in at least two of the last three years. (P. 18)
4. Stock and monitoring of expenditure payment arrears
D+
Notes:
4.1 Stock of expenditure payment arrears (as a percentage of actual total expenditure for the corresponding fiscal year) and any recent change in the stock
A
Notes:
The stock of arrears is low (i.e. is below 2% of total expenditure) (P. 19)
4.2 Availability of data for monitoring the stock of expenditure payment arrears
D
Notes:
There is no reliable data on the stock of arrears from the last two years (P. 19)
II. Comprehensiveness and Transparency
Scores by Dimension
Overall Indicator Score
5. Classification of the budget
A
Notes:
5.1 The classification system used for formulation, execution and reporting of the central government's budget
A
Notes:
The budget formulation and execution is based on administrative, economic and sub-functional classification, using GFS/COFOG standards or a standard that can produce consistent documentation according to those standards. (Program classification may substitute for sub-functional classification, if it is applied with a level of detail at least corresponding to sub-functional.) (P. 20)
6. Comprehensiveness of information included in budget documentation
C
Notes:
6.1 Share of the listed information under PI-6 in the PFM PMF booklet in the budget documentation most recently issued by the central government (in order to count in the assessment, the full specification of the information benchmark must be met)
C
Notes:
Recent budget documentation fulfills 3 to 4 of the 9 information benchmarks (P. 21)
7. Extent of unreported government operations
D+
Notes:
7.1 The level of extra-budgetary expenditure (other than donor funded projects) which is unreported i.e. not included in fiscal reports.
A
Notes:
The level of unreported extra-budgetary expenditure (other than donor funded projects) is insignificant (below 1% of total expenditure) (P. 21)
7.2 Income/expenditure information on donor-funded projects which is included in fiscal reports.
D
Notes:
Information on donor financed projects included in fiscal reports is seriously deficient (P. 21)
8. Transparency of inter-governmental fiscal relations
B
Notes:
8.1 Transparent and rules based systems in the horizontal allocation among SN governments of unconditional and conditional transfers from central government (both budgeted and actual allocations);
A
Notes:
The horizontal allocation of almost all transfers (at least 90% by value) from central government is determined by transparent and rules based systems (P. 23)
8.2 Timeliness of reliable information to SN governments on their allocations from central government for the coming year;
A
Notes:
SN governments are provided reliable information on the allocations to be transferred to them before the start of their detailed budgeting processes (P. 23)
8.3 Extent to which consolidated fiscal data (at least on revenue and expenditure) is collected and reported for general government according to sectoral categories.
D
Notes:
Fiscal information that is consistent with central government fiscal reporting is collected and consolidated for less than 60% (by value) of SN government expenditure OR if a higher proportion is covered, consolidation into annual reports takes place with more than 24 months delay, if at all (P. 23)
9. Oversight of aggregate fiscal risk from other public sector entities.
D+
Notes:
9.1 Extent of central government monitoring of AGAs and PEs.
C
Notes:
Most major AGAs/PEs submit fiscal reports to central governments at least annually, but a consolidated overview is missing or significantly incomplete. New legislation in place to bring public enterprises under central monitoring (P. 24)
9.2 Extent of central government monitoring of SN government's fiscal position
D
Notes:
No annual monitoring of SN governments’ fiscal position takes place or it is significantly incomplete (P. 24)
10. Public access to key fiscal information
C
Notes:
10.1 Number of the above listed elements of public access to information that is fulfilled (in order to count in the assessment, the full specification of the information benchmark must be met)
C
Notes:
The government makes available to the public 1-2 of the 6 listed types of information (P. 25)
III. Policy-Based Budgeting
Scores by Dimension
Overall Indicator Score
11. Orderliness and participation in the annual budget process
B
Notes:
11.1 Existence of and adherence to a fixed budget calendar;
B
Notes:
A clear annual budget calendar exists, but some delays are often experienced in its implementation. The calendar allows MDAs reasonable time (at least four weeks from receipt of the budget circular) so that most of them are able to meaningfully complete their detailed estimates on time (P. 26)
11.2 Clarity/comprehensiveness of and political involvement in the guidance on the preparation of budget submissions (budget circular or equivalent);
B
Notes:
A comprehensive and clear budget circular is issued to MDAs, which reflects ceilings approved by Cabinet (or equivalent). This approval takes place after the circular distribution to MDAs, but before MDAs have completed their submission (P. 26)
11.3 Timely budget approval by the legislature or similarly mandated body (within the last three years);
C
Notes:
The legislature has, in two of the last three years, approved the budget within two months of the start of the fiscal year (P. 26)
12. Multi-year perspective in fiscal planning, expenditure policy and budgeting
C+
Notes:
12.1 Preparation of multi -year fiscal forecasts and functional allocations
B
Notes:
Forecasts of fiscal aggregates (on the basis of main categories of economic and functional/sector classification) are prepared for at least two years on a rolling annual basis. Links between multi-year estimates and subsequent setting of annual budget ceilings are clear and differences are explained (P. 27)
12.2 Scope and frequency of debt sustainability analysis
A
Notes:
DSA for external and domestic debt is undertaken annually (P. 27)
12.3 Existence of sector strategies with multi-year costing of recurrent and investment expenditure;
D
Notes:
Sector strategies may have been prepared for some sectors, but none of them have substantially complete costing of investments and recurrent expenditure Sector strategies may have been prepared for some sectors, but none of them have substantially complete costing of investments and recurrent expenditure (P. 27)
12.4 Linkages between investment budgets and forward expenditure estimates.
D
Notes:
Budgeting for investment and recurrent expenditure are separate processes with no recurrent cost estimates being shared (P. 27)
IV. Predictability and Control in Budget Execution
Scores by Dimension
Overall Indicator Score
13. Transparency of taxpayer obligations and liabilities
C+
Notes:
13.1 Clarity and comprehensiveness of tax liabilities
B
Notes:
Legislation and procedures for most, but not necessarily all, major taxes are comprehensive and clear, with fairly limited discretionary powers of the government entities involved (P. 28)
13.2 Taxpayer access to information on tax liabilities and administrative procedures.
B
Notes:
Taxpayers have easy access to comprehensive, user friendly and up-to-date information on tax liabilities and administrative procedures for all major taxes, and the RA supplements this with active taxpayer education campaigns (P. 28)
13.3 Existence and functioning of a tax appeals mechanism.
D
Notes:
No functioning tax appeals system has been established(P. 28)
14. Effectiveness of measures for taxpayer registration and tax assessment
D+
Notes:
14.1 Controls in the taxpayer registration system.
B
Notes:
Taxpayers are registered in a complete database system with some linkages to other relevant government registration systems and financial sector regulations (P. 29)
14.3 Planning and monitoring of tax audit and fraud investigation programs.
D
Notes:
Tax audits and fraud investigations are undertaken on an ad hoc basis if at all (P. 29)
14.2 Effectiveness of penalties for non-compliance with registration and declaration obligations
D
Notes:
Penalties for non-compliance are generally non-existent or ineffective (i.e. set far too low to have an impact or rarely imposed) (P. 29)
15. Effectiveness in collection of tax payments
D+
Notes:
15.1 Collection ratio for gross tax arrears, being the percentage of tax arrears at the beginning of a fiscal year, which was collected during that fiscal year (average of the last two fiscal years).
D
Notes:
This is the default score. No system for managing tax arrears is in place (P. 30)
15.2 Effectiveness of transfer of tax collections to the Treasury by the revenue administration.
B
Notes:
Revenue Collections are transferred to the treasury at least weekly (P. 30)
15.3 Frequency of complete accounts reconciliation between tax assessments, collections, arrears records and receipts by the Treasury.
D
Notes:
Complete reconciliation of tax assessments, collections, arrears and transfers to Treasury does not take place annually or is done with more than 3 months’ delay. (P. 30)
16. Predictability in the availability of funds for commitment of expenditures
C+
Notes:
16.2 Reliability and horizon of periodic in-year information to MDAs on ceilings for expenditure commitments
B
Notes:
MDAs are provided reliable information on commitment ceilings at least quarterly in advance (P. 31)
16.3 Frequency and transparency of adjustments to budget allocations, which are decided above the level of management of MDAs.
A
Notes:
Significant in-year adjustments to budget allocations take place only once or twice in a year and are done in a transparent and predictable way (P. 31)
16.1 Extent to which cash flows are forecast and monitored
C
Notes:
A cash flow forecast is prepared for the fiscal year, but is not (or only partially and infrequently) updated (P. 31)
17. Recording and management of cash balances, debt and guarantees
D+
Notes:
17.1 Quality of debt data recording and reporting
C
Notes:
Domestic and foreign debt records are complete, updated and reconciled at least annually. Data quality is considered fair, but some gaps and reconciliation problems are recognized. Reports on debt stocks and service are produced only occasionally or with limited content (P. 32)
17.2 Extent of consolidation of the government’s cash balances
C
Notes:
Calculation of most government cash balances take place at least monthly, but the system used does not allow consolidation of bank balances (P. 32)
17.3 Systems for contracting loans and issuance of guarantees.
D
Notes:
This is the default score, as the conditions for a C score (central government’s contracting of loans and issuance of guarantees are always approved by a single responsible government entity, but are not decided on the basis of clear guidelines, criteria or overall ceilings) are not fully met (P. 32)
18. Effectiveness of payroll controls
D+
Notes:
18.1 Degree of integration and reconciliation between personnel records and payroll data.
D
Notes:
Integrity of the payroll is significantly undermined by lack of complete personnel records and personnel database, or by lack of reconciliation with the payroll (P. 33)
18.2 Timeliness of changes to personnel records and the payroll
B
Notes:
Up to three months’ delay occurs in updating of changes to the personnel records and payroll, but affects only a minority of changes. Retroactive adjustments are made occasionally (P. 33)
18.3 Internal controls of changes to personnel records and the payroll.
B
Notes:
Authority and basis for changes to personnel records and the payroll are clear (P. 33)
18.4 Existence of payroll audits to identify control weaknesses and/or ghost workers.
C
Notes:
Partial payroll audits or staff surveys have been undertaken within the last 3 years (P. 33)
19. Transparency, competition and complaints mechanisms in procurement
D
Notes:
19.1 Transparency, comprehensiveness and competition in the legal and regulatory framework
D
Notes:
The legal framework meets one or none of the six listed requirements (P. 35)
19.2 Use of competitive procurement methods
D
Notes:
Reliable data is not available (P. 35)
19.3 Public access to complete, reliable and timely procurement information
D
Notes:
The government lacks a system to generate substantial and reliable coverage of key procurement information, and does not systematically make key procurement information available to the public (P. 35)
19.4 Existence of an independent administrative procurement complaints system
D
Notes:
There is no independent procurement complaints review body. (P. 35)
20. Effectiveness of internal controls for non-salary expenditure
D+
Notes:
20.1 Effectiveness of expenditure commitment controls.
D
Notes:
Commitment control systems are generally lacking OR they are routinely violated (P. 36)
20.2 Comprehensiveness, relevance and understanding of other internal control rules/ procedures
C
Notes:
Other internal control rules and procedures consist of a basic set of rules for processing and recording transactions, which are understood by those directly involved in their application. Controls may be deficient in areas of minor importance (P. 36)
20.3 Degree of compliance with rules for processing and recording transactions
C
Notes:
Rules are complied with in a significant majority of transactions, but use of simplified procedures in unjustified situations is an important concern. (P. 36)
21. Effectiveness of internal audit
D
Notes:
21.1 Coverage and quality of the internal audit function.
D
Notes:
There is little or no internal audit focused on systems monitoring (P. 37)
21.2 Frequency and distribution of reports
D
Notes:
Reports are either non-existent or very irregular (P. 37)
21.3 Extent of management response to internal audit findings.
D
Notes:
Default score when there is no internal audit capacity (P. 37)
V. Accounting, Recording and Reporting
Scores by Dimension
Overall Indicator Score
22. Timeliness and regularity of accounts reconciliation
C
Notes:
22.1 Regularity of bank reconciliations
B
Notes:
Bank reconciliation for all Treasury managed bank accounts takes place with backlogs of several months (P. 38)
22.2 Regularity of reconciliation and clearance of suspense accounts and advances.
D
Notes:
Reconciliation and clearance of suspense accounts and advances take place at least annually within two months of end of period. Some accounts have uncleared balances brought forward (P. 38)
23. Availability of information on resources received by service delivery units
C
Notes:
23.1 Collection and processing of information to demonstrate the resources that were actually received (in cash and kind) by the most common front-line service delivery units (focus on primary schools and primary health clinics) in relation to the overall
C
Notes:
Special surveys undertaken within the last 3 years have demonstrated the level of resources received in cash and in kind by either primary schools or primary health clinics covering a significant part of the country (P. 39)
24. Quality and timeliness of in-year budget reports
D
Notes:
24.1 Scope of reports in terms of coverage and compatibility with budget estimates
D
Notes:
This is the default score. Quarterly reports are not prepared, though the budget and accounting systems use the same chart of accounts (P. 40)
24.2 Timeliness of the issue of reports
D
Notes:
Quarterly reports are not prepared (P. 40)
24.3 Quality of information
D
Notes:
This is the default score. Quarterly reports are not prepared, and if they were there would be concerns about the accuracy of information (P. 40)
25. Quality and timeliness of annual financial statements
D+
Notes:
25.1 Completeness of the financial statements
C
Notes:
A consolidated government statement is prepared annually. Information on revenue, expenditure and bank account balances may not always be complete, but the omissions are not significant (P. 41)
25.2 Timeliness of submission of the financial statements
B
Notes:
The consolidated government statement is usually submitted for external audit within 10 months of the end of the fiscal year (P. 41)
25.3 Accounting standards used
D
Notes:
Statements are not presented in a consistent format over time or accounting standards are not disclosed (P. 41)
VI. External Scrutiny and Audit
Scores by Dimension
Overall Indicator Score
26. Scope, nature and follow-up of external audit
B+
Notes:
26.1 Scope/nature of audit performed (incl. adherence to auditing standards).
A
Notes:
All entities of central government are audited annually covering revenue, expenditure and assets/liabilities. A full range of financial audits and some aspects of performance audit are performed and generally adhere to auditing standards, focusing on significant and systemic issues (P. 42)
26.2 Timeliness of submission of audit reports to legislature.
A
Notes:
Audit reports are submitted to the legislature within 4 months of the end of the period covered and in the case of financial statements from their receipt by the audit office (P. 42)
26.3 Evidence of follow up on audit recommendations
B
Notes:
A formal response is made in a timely manner, but there is little evidence of systematic follow up (P. 42)
27. Legislative scrutiny of the annual budget law
C+
Notes:
27.1 Scope of the legislature’s scrutiny.
C
Notes:
The legislature’s review covers details of expenditure and revenue, but only at a stage where detailed proposals have been finalized (P. 43)
27.2 Extent to which the legislature’s procedures are well-established and respected.
B
Notes:
Simple procedures exist for the legislature’s budget review and are respected (P. 43)
27.3 Adequacy of time for the legislature to provide a response to budget proposals both the detailed estimates and, where applicable, for proposals on macro-fiscal aggregates earlier in the budget preparation cycyle (time allowed in practice for all stag
C
Notes:
The legislature has at least one month to review the budget proposals (P. 43)
27.4 Rules for in-year amendments to the budget without ex-ante approval by the legislature.
C
Notes:
Clear rules exist, but they allow extensive administrative reallocation as well as expansion of total expenditure (P. 43)
28. Legislative scrutiny of external audit reports
B
Notes:
28.1 Timeliness of examination of audit reports by the legislature (for reports received within the last three years).
B
Notes:
Scrutiny of audit reports is usually completed by the legislature within 6 months from receipt of the reports (P. 44)
28.2 Extent of hearings on key findings undertaken by the legislature.
B
Notes:
In-depth hearings on key findings take place with responsible officers from the audited entities as a routine, but may cover only some of the entities, which received a qualified or adverse audit opinion (P. 44)
28.3 Issuance of recommended actions by the legislature and implementation by the executive.
B
Notes:
Actions are recommended to the executive, some of which are implemented, according to existing evidence (P. 44)
Donor Practices
Scores by Dimension
Overall Indicator Score
D-1 Predictability of Direct Budget Support
A
Notes:
D-1.1 Annual deviation of actual budget support from the forecast provided by the donor agencies at least six weeks prior to the government submitting its budget proposals to the legislature (or equivalent approving body).
A
Notes:
In no more than one out of the last three years has direct budget support outturn fallen short of the forecast by more than 5% (P. 46)
D-1.2 In-year timeliness of donor disbursements (compliance with aggregate quarterly estimates)
A
Notes:
Quarterly disbursement estimates have been agreed with donors at or before the beginning of the fiscal year and actual disbursement delays (weighted) have not exceeded 25% in two of the last three years (P. 46)
D-2 Financial information provided by donors for budgeting and reporting on project and program aid
D
Notes:
D-2.1 Completeness and timeliness of budget estimates by donors for project support.
D
Notes:
Not all major donors provide budget estimates for disbursement of project aid at least for the government’s coming fiscal year and at least three months prior its start (P. 47)
D-2.2 Frequency and coverage of reporting by donors on actual donor flows for project support.
D
Notes:
Donors do not provide quarterly reports within two month of end-of-quarter on the disbursements made for at least 50% of the externally financed project estimates in the budget (P. 47)
D-3 Proportion of aid that is managed by use of national procedures
D
Notes:
D-3.1 Overall proportation of aid funds to central government that are managed through national procedures
D
Notes:
Less than 50% of aid funds to central government are managed through national procedures (P. 48)
