Global Assessment of the Harmonized Approach to Cash Transfer … · Global Assessment of the...

Global Assessment of the Harmonized Approach to Cash Transfer (HACT)

UNDG HACT Advisory Committee

New York, 7 December 2011

UNDG HACT Advisory Committee Global HACT Assessment

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Table of Contents

Acronyms and Abbreviations ............................................................................................................................. V

Acknowledgements ........................................................................................................................................... VI

1 Executive Summary ............................................................................................................................... 1

2 Introduction .......................................................................................................................................... 5

2.1 Context and Objective .............................................................................................................................. 5

2.1 Methodology ............................................................................................................................................ 6

3 Global Annual Update Analysis .............................................................................................................. 8

3.1 Reporting and Overall Implementation Status ........................................................................................ 8

3.2 Capacity Assessments and Assurance Activities .................................................................................... 11

3.2.1 Implementation Status of Capacity Assessments ............................................................................. 11

3.2.2 Implementation Status of Assurance and Audit Plans ..................................................................... 12

3.3 Reported Implementation Status Related to Specific Country Groups ................................................. 13

3.3.1 Implementation Status and the Group of Least Developed Countries ............................................ 14

3.3.2 Implementation Status and Country Categorization by GNI ............................................................ 16

3.3.3 Reported Implementation Status of Delivering as One Countries ................................................... 17

3.4 Coordination and Management of the Global Annual Update .............................................................. 19

4 HACT Capacity Assessments ................................................................................................................ 21

4.1 Government Agreement and Cooperation ............................................................................................ 21

4.1.1 Government Agreement and Challenges at the National Level ....................................................... 22

4.1.2 Challenges at the Implementing Partner Level ................................................................................ 24

4.2 Macro Assessment ................................................................................................................................. 26

4.2.1 Objectives of the Macro Assessment ............................................................................................... 26

4.2.2 Challenges Related to Macro Assessments ...................................................................................... 27

4.3 Micro Assessment .................................................................................................................................. 30

4.3.1 Objectives of the Micro Assessment ................................................................................................ 30

4.3.2 Challenges Related to Micro Assessments ....................................................................................... 31

4.3.3 Definition of Implementing Partner ................................................................................................. 35


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4.3.4 Definition of Financial Thresholds .................................................................................................... 36

5 HACT Implementation ......................................................................................................................... 38

5.1 Cash Transfer Procedures ....................................................................................................................... 38

5.1.1 Funding Authorization and Certificate of Expenditures ................................................................... 38

5.1.2 Periodicity and Disbursement of Reporting ..................................................................................... 41

5.1.3 Implementation of International Public Sector Accounting Standards ............................................ 43

5.2 Assurance Activities ................................................................................................................................ 45

5.2.1 Objectives of HACT Assurance Activities .......................................................................................... 45

5.2.2 HACT Assurance versus Project Level Auditing ................................................................................ 46

5.2.3 Challenges Related to HACT Audits .................................................................................................. 48

5.2.4 Challenges Related to UN Capacity .................................................................................................. 49

5.3 Capacity Development of Implementing Partners ................................................................................. 51

5.4 Interpretation of HACT Compliance ....................................................................................................... 53

5.4.1 UNDG Designation and Criteria ........................................................................................................ 54

5.4.2 Review of HACT Compliance Criteria ................................................................................................ 55

6 The Role of Specialized Agencies ......................................................................................................... 57

7 Governance and Coordination ............................................................................................................. 59

7.1 Distribution of Roles and Responsibilities .............................................................................................. 59

7.2 Challenges Related to Country-level Coordination ................................................................................ 63

8 Conclusion........................................................................................................................................... 67

Annexes

Annex I: Recommendations ......................................................................................................................... 70

Annex II: Global Web-based Survey .............................................................................................................. 73

Annex III: Global Annual Updates 2008-2011 – Summary Table ................................................................. 105

Annex IV: Global Annual Updates 2008-2011 – Trends ............................................................................... 108

Annex V: Country Example Mozambique – Comparative Analysis FACE Form Management ................... 113

Annex VI: Assessment Interview and Teleconference Schedule ................................................................. 114

Annex VII: Reference Documents ................................................................................................................. 115


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Tables

Table 3.3.1: HACT Implementation Status – HACT Implementing LDCs versus non-LDCs ............................. 15

Table 3.3.2: HACT Implementation status – HACT Implementing and Non-implementing Countries by

LDCs versus non-LDCs ................................................................................................................. 15

Table 3.3.3: HACT Implementation Status – HACT Implementing and Non-implementing Countries by

GNI Categories ............................................................................................................................. 17

Table 3.3.4: HACT Implementations Status – Delivering as One Countries .................................................... 18

Table 4.3.1: Number of Common Implementing Partners in Selected Programme Countries ...................... 33

Table 5.1.1: Periodicity of Disbursement and Reporting ................................................................................ 40

Table 5.4.1: Sample Indicators for Full HACT Implementation ....................................................................... 56

Table 6.1.1: UN Programmes and Specialized Agencies Implementing HACT ................................................ 57

Table 7.1.1: Distribution of HACT Relevant Roles and Responsibilities .......................................................... 63

Figures

Figure 3.1.1: HACT Implementation by Region ............................................................................................... 10

Figure 3.2.1: Reported Progress of HACT Implementing Countries by Region ............................................... 12

Figure 5.2.1: Number of Joint Assurance and Audit Plans by Region ............................................................. 45

Figure 7.1.1: Complexity of HACT Coordination ............................................................................................. 60


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Acronyms and Abbreviations

AWP Annual Work Plan CCA Common Country Assessment CEB Chief Executive Board CPAP Country Programme Action Plan DaO Delivering as One EU European Union FACE Funding Authorization and Certificate of Expenditures FST Field Support Team HACT Harmonized Approach to Cash Transfer HACT AC UNDG HACT Advisory Committee HLCM High Level Committee on Management HST Headquarter Support Team IPSAS International Public Sector Accounting Standards IP Implementing Partner OMT Operations Management Team PFM Public Financial Management NCC Net Contributing Country NGO Non-governmental Organisation OMT Operations Management Team PEFA Public Expenditure and Financial Accountability RC Resident Coordinator RCO Office of the Resident Coordinator SAI Supreme Audit Institution SOP Standard Operating Procedures UN United Nations UNDG United Nations Development Group UNCT United Nations Country Team UNDP United Nations Development Programme UN DOCO Development Operations Coordination Office UNFPA United Nations Populations Fund UNICEF United Nations Children’s Fund UN OHRLLS United Nations Office of the High Representative for the Least Developed

Countries, Landlocked Developing Countries, and Small Island Developing States UN Woman United Nations Woman WFP World Food Programme WHO World Health Organisation


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Acknowledgements Conducting this assessment would not have been possible without the commitment and support of the members of the UNDG HACT Advisory Committee who provided guidance and information throughout the entire project period. In particular, the dedicated support of the focal points at UN DOCO ensured a high participation rate in the global web-based survey and the successful completion of a series of headquarter and country-level interviews. In addition, the input and availability of senior managers at headquarter level and staff members from the country offices in Armenia, Brazil, Ethiopia, Gambia, Morocco, Papua New Guinea and the Philippines has been essential for achieving the objectives of this assessment.

Disclaimer: This report was developed as an independent assessment for the UNDG HACT Advisory Committee. The views and opinions expressed in this document do not necessarily reflect those of the United Nations or any of its Agencies, Commissions, Funds or Programmes. Owner: UNDG HACT Advisory Committee Consultant: Christian Schörnich Final Version, 07 December 2011

[email protected]


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1 Executive Summary 1. HACT was introduced in 2005 as a common operational framework for disbursing cash to government

and non-government implementing partners with the objective to support a closer alignment of development aid with national priorities and strengthen national capacities for management and accountability. HACT aims to reduce transaction costs by harmonizing agency-specific business practices and moving from a control-based to a risk-based financial management system. The overall objective of the global HACT assessment is to identify the level of execution, highlight the challenges of the concept and its implementation, and assess the effectiveness of the HACT-related instruments. The findings revealed that the implementation of HACT has only been in part successful. The HACT concept with its aim to introduce a risk-based financial management approach has introduced a complexity to the management of cash disbursements and reporting that frequently exceeds the capacity of the UN and implementing partners at the country-level.

2. In many programme countries, HACT has not been implemented beyond the initial stages of the

required capacity assessments and its management is often accompanied by the parallel continuation of financial controls. As HACT is a harmonized approach, its implementation has introduced significant challenges to the inter- and intra-agency coordination which have to cope with a narrow bandwidth of flexibility within the limits of the existing agency-specific financial regulations and rules. The full implementation of HACT requires an increasing commitment of the senior management to harmonization and a high investment in expanding and updating existing guidelines. As HACT might only be feasible for a part of all programme countries, the UNDG should carefully review whether the commitment can be ensured and the necessary investment will indeed result in an equivalent amount of efficiency gains.

3. In accordance with the recent global annual update, 96 of all listed programme countries reported

being in the process of implementing HACT (64%). While 82 countries reported having an agreement with the government (85.4%), 86 countries confirmed having completed a macro assessment (89.6%). Sixty countries completed micro assessments or assumed ‘high risk’ category for their implementing partners (62.5%). A particular challenge seems to be the implementation of assurance and audit plans as only 44 countries reported having completed this step, corresponding to an implementation rate of 45.8% among the HACT implementing countries. Testing the implementation rates against the development status or income level of programme countries has not revealed any evidence that the HACT concept would be less applicable to the group of Least Developed or Low Income Countries. However, Delivering as One countries have a higher level of HACT implementation compared to all other implementing countries. The reasons for this lie in the increased emphasis on inter-agency coordination and a greater commitment to harmonize business practices at the country level. Altogether, the analysis of data has been difficult as the information requested through the global annual update leaves much room for interpretation. This results in the provision of often contradictory


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data by country-level focal points. In its current form, the update itself reveals a high degree of process orientation as there seems to be no strategic intent to use the provided information for achieving specific results.

4. Together with the assurance and audit activities, the capacity assessments build the core of the HACT

approach. While the capacity assessments do not establish any conditionality for assistance from agencies, they determine the cash transfer modality and the frequency and coverage of assurance activities. The intention to conduct capacity assessments is the main reason for governments to oppose the implementation of HACT because the systematic approach through assessments and assurance activities at the institutional level is interpreted as interfering in national sovereignty. In addition, net contributing countries or those with a high amount of third-party cost sharing consider themselves to a large extent as partners for development rather than recipients of financial resources through UN agencies. Therefore, terms and conditions as stipulated by the HACT framework are perceived to introduce unnecessary accounting and reporting obligations. As the framework does not foresee or clarify circumstances under which HACT is not applicable, UNCTs have no clear reference or guidance on how to approach HACT in net contributing countries with a high amount of third-party cost sharing.

5. Incentives for governments to agree to and fully support HACT have not been sufficiently outlined. For

many governments, the introduction of HACT is accompanied by very high entry costs in terms of full financial and organizational disclosure at the directorate or departmental levels. Risk ratings applied by third-party audit/consulting firms expose capacity gaps and organizational weaknesses with a potentially negative impact on cash disbursements through other development partners. The link between the introduction of these profound measures and increasing national ownership as per the Paris Declaration of Aid Effectiveness is understandably difficult to comprehend. While the HACT framework underlines that the approach allows efforts to focus on strengthening national capacities and a significant reduction of transaction costs, it does not go beyond a description of technical procedures of how to conduct assessments or request and report expenditures.

6. While the macro assessment is a desk review of existing information, conducting the micro assessment

is frequently accompanied by enormous challenges. While many confirmed a relatively low quality of micro assessment reports from service providers, the underlying causes are insufficient coordination and management of the micro assessments through the participating UN agencies. This includes the lack of a common HACT database in many countries, inadequate understanding among the UN agencies on the roles and responsibilities in the management of the HACT process, and the absence of a systematic follow-up mechanism on the findings and recommendations. In addition, it is difficult for many countries to source qualified audit/consulting firms that are able to carry out such a complex exercise. In many countries, the private sector still lacks a developed and competitive business environment that would ensure the selection of a firm that guarantees good value for the money. In turn, managing the process in cooperation with the audit/consulting firm generates high transaction costs for the agencies.


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7. The different understanding of the implementing partner designation has led to notable differences between and within programme countries in the HACT implementation process. Defining the implementing partner at the national ministry level dramatically reduces the amount of micro assessments. While positive effects include a profound reduction of transaction costs and the possibility to incorporate the ministries’ control and accountability systems over its departments, the results of the capacity assessments are not related to recipient of funds, but to a higher level with a potentially different accounting system and internal control framework. This implies that there is little recognition of varying capacity gaps leading to different financial risks at the level of departments or project management units. Since the main objectives of the micro assessment support the implementation of the appropriate cash transfer modality and have been defined in the identification of capacity development needs and targeted assurance activities, it seems appropriate that the implementing partner level should correspond to the level at which financial transactions are made and the FACE form is utilized to request payments and report on expenditures.

8. While many countries reported some difficulties with the management of the FACE form, the findings

support that the form is an effective tool to manage disbursements and reporting of implementing partners. However, the frequent adaptation of the FACE form through practitioners at the country level has led to many differences in the required information and annexes. The result has been the implementation of a number of additional business processes that have resulted in a parallel application of control-based financial management practices. The introduction of additional supporting documentation as part of the expenditure reporting, such as bank reconciliation statements and stamped invoices, indicates that many country offices have not fully understood the principles of a risk-based financial management approach.

9. The analysis of the global annual updates has shown that HACT implementing countries have particular

challenges in establishing assurance and audit plans. A number of countries that have implemented assurance and audit plans have not been able to systematically follow up with the actual assurance activities. The main reason for this is the limited staff and financial capacity of the UN at the country level to carry out regular and effective assurance activities for a large number of implementing partners. Apart from these constraints, the absence of UNDG approved guidelines that would clarify how assurance activities should be carried out in line with minimum corporate audit requirements has led to criticism by internal audit departments which frequently stated that HACT assurance activities would not qualify for replacing project-based audits. According to the discussions with country offices, the solution lies in the development of guidelines that clarify and standardize HACT assurance activities to an extent where the documented results of on-site reviews can effectively replace project-related audits.

10. The HACT compliance designation with its four major criteria describe steps in the HACT process which

together only contribute to some of the prerequisites enabling a harmonized cash transfer approach. Government agreement, capacity assessments and the development of an assurance and audit plan are no indicators for the actual implementation of HACT at the country level. Being HACT compliant as per the above definition does not provide evidence to what extent HACT has been implemented or


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whether any of the objectives of HACT have been achieved. The HACT compliance designation represents a process rather than results orientation which implies that a number of countries that are fulfilling the criteria for HACT compliance are, in fact, not fully implementing HACT. A full implementation of HACT would involve providing assurance in accordance with the results of the capacity assessments through qualified on-site reviews and moving to a common HACT audit regime. The successful implementation of HACT is dependent on the execution of HACT-relevant activities as much as ensuring that the parallel application of financial control mechanisms is brought to a close. It is important full HACT implementation is based upon a set of results-oriented and measurable indicators. Apart from enabling a better evaluation of the HACT implementation process, they would greatly support a better orientation on how to operationally implement HACT.

11. The implementation of HACT has introduced a complexity comparable to other functional areas that

have been subject to inter-agency harmonization in the course of the UN reform process. However, HACT is subject to different financial regulations and rules leading to a low probability of a fully harmonized implementation of HACT. While practitioners are frequently requested to support the harmonization of HACT at the country level, agency-specific policies and procedures constitute bottlenecks for a successful coordination of activities. The findings indicate that HACT has not been accepted and institutionalized as a mandatory process. Although implemented as a UNDG-approved framework, individual agencies seem to reserve the right to withhold the implementation or adapt the framework to their own requirements. Therefore, the establishment of an accountability framework that would translate HACT policies and procedures into personal responsibilities would facilitate the coordination process. In this regard, the leadership role of the Resident Coordinator is imperative for a successful implementation of HACT at the country level. The experience from Delivering as One countries has shown that the success of common UN initiatives is highly dependent on an effective organizational structure which allows for short communication ways, efficient coordination of activities and the distribution of clear accountabilities to UNCT-appointed staff. In addition, the establishment of a joint HACT database is crucial to create the level of institutional knowledge that is necessary to follow a well coordinated approach to common assurance activities, HACT trainings and appropriate cost sharing mechanisms.


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2 Introduction

2.1 Context and Objective 12. In line with the UN General Assembly Resolution 56/201 on the triennial policy review of the

operational activities for development of the United Nations system, UNDP, UNICEF, UNFPA and WFP adopted a common operational framework for transferring financial resources to government and non-government implementing partners with the objective to further harmonize the multiplicity of UN rules and procedures. HACT was introduced in September 2005 with the aim to shift from a control-based programming approach to a broader approach of financial risk management. In addition, the implementation of HACT intended to lead to a closer alignment of development aid with national priorities and needs, a gradual shift towards utilizing national systems, significant reduction of transaction costs, and capacity enhancement of implementing partners in financial programme management and accountability.

13. Based on the experience and management of HACT implementation, many challenges have been

identified that constitute bottlenecks to the successful implementation of HACT at the country level. The recent high level UNDG-HLCM mission on business practices to four selected countries addressed the remaining challenges and concluded that there is a requirement to expedite the implementation of HACT. Apart from a call to strengthen its implementation by adopting a more systematic approach, the mission recommended that there are opportunities for higher efficiencies through the harmonization of related business practices at the country level.

14. The global assessment of the HACT implementation aims to provide an in-depth analysis of the

challenges in the implementation process leading to concrete recommendations on how to improve the management and strengthen the implementation of HACT. As per its terms of reference, the assessment has the following objectives:

• Assess the efficiency and effectiveness of the components and steps in the HACT implementation process, including the macro and micro assessment, the utilization of the FACE form, and the implementation of assurance activities;

• Identify quality standards and criteria for HACT compliance and taking note of the related governance and accountability issues;

• Identify the challenges encountered during the different stages of the HACT implementation and the support systems, roles and responsibilities, and strategies used by UNCT’s to address these challenges;

• Identify agency-specific bottlenecks and areas where further policy and management support is required;

• Identify opportunities to harmonize HACT with the adoption of IPSAS;


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• Propose modifications to the HACT framework and practices as appropriate, and

• Make specific recommendations for further strengthening the HACT implementation across other UNDG agencies and across all country offices.

2.2 Methodology 15. The assessment included a number of different methodologies to provide an in-depth analysis of the

global HACT implementation and arrive to informed recommendations. In detail, the assessment consisted of the following elements:

16. Desk review and analysis of key documentation as listed in the terms of reference for this assessment

and provided by the UNDG HACT Advisory Committee, UN DOCO focal points, and other stakeholders in the process of the research. This includes further background documentation or data that was provided by interviewees at headquarter and country level.

17. Qualitative and quantitative assessment of the HACT implementation progress and its status, based on

the global annual updates as provided by UN DOCO. This included the results of the recent update from October 2011. The data was analyzed and filtered by regions, different areas of implementation, and other assurance activities. In addition to providing detailed inormation about the implementation status, the analysis of the global annual updates served to confirm or falsify existing hypotheses from other documents.

18. Developing and conducting qualitative research interviews with senior management at headquarter

level and staff members from selected country offices who are focal points for the HACT implementation at the RCO or their agencies. The selection criteria for interviewees and country offices was developed in cooperation with the UNDG HACT Advisory Committee. The standardized interview questionnaire was reviewed and approved by the UNDG HACT Advisory Committee and aimed to gather important information capturing perceptions on the implementation of HACT from the perspective of a diverse group of stakeholders.

19. Developing, conducting and analyzing a structured web-based survey, targeting all HACT implementing

countries – incluging funds, programmes, specialized agencies, both resident and non-resident, and selected implementing partners. The survey aimed to collect standardized information about the HACT implementation and stakeholder’s perceptions through a structured questionnaire. To most effectively collect relevant information, the survey included different question types, such as multiple choice, matrix of choices, rating scales and text boxes. Advanced validation options included open text fields for optional and additional comments. The survey was developed and conducted by using a professional web-based survey tool which allowed for a high-quality design of the questionnaire and a


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high return rate of answered questionnaires. The web-based survey was approved by the UNDG HACT Advisory Committee and launched by UN DOCO.


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3 Global Annual Update Analysis 20. UN DOCO carries out a global annual update to account for the HACT implementation status in all

programme countries and to provide a comprehensive summary of data sorted by region.1 The update is used to track the global status of the HACT implementation and is conducted through the Regional Coordination Specialists for countries of their regions. The update is shared with the UNDG HACT Advisory Committee and the Regional UNDG Chairs. Since the first Global Annual Update in 2008, four updates have been carried out with the most recent being finalized in October 2011. For this assessment, all updates have been reviewed by programme country over time to analyze all available data and identifying trends during the past four years. As 24% of all listed countries did not follow the request to report on their status, the most recent update of such countries from previous years serves to indicate the current implementation status.2

3.1 Reporting and Overall Implementation Status

21. The recent global annual update from October 2011 lists 150 countries, which are divided into six regions. In 2011, the total number of countries increased to 150 from a constant 136 in the period between 2008 and 2010. The reason for this lies in the now separate listing of 12 small island states of the South Pacific, which are under the management of the UNCTs of either Samoa or Fiji. In addition to these small island states, Seychelles and South Sudan have joined the list of HACT relevant countries.3

22. In the recent update, 114 countries reported on their implementation status, which corresponds to an overall reporting rate of 76%. This is an increase of 15% from the previous year, where 83 countries out of then 136 listed countries reported. In the years before, the reporting rates were much lower at only 57% in 2009 and 59% in 2008. Separating the reporting rates of the October 2011 update by regions reveals that East & South Africa with only 14 out of 22 countries reporting (63.6%) and West & Central Africa with 15 out of 24 countries reporting (62.5%) have the lowest reporting rates. These regions are followed by Asia & Pacific with 28 out of 36 countries reporting (78%). In the regions Latin America & Caribbean, Arab States and Europe & CIS all countries reported, except for those where HACT is not applicable and where, in one case, the UNCT had postponed the implementation of HACT.4

1 UN DOCO provides the Global Annual Update sorted by six different regions: East and South Africa (22 countries), West and Central Africa (24 countries), Arab States (18 countries), Asia and Pacific (36 countries), Europe and CIS (24 countries), Latin America and Caribbean (26 countries). 2 Out of the total of 150 listed countries, 36 countries did not report on their HACT implementation status in the most recent update (24%). 3 Previously combined under Fiji and Samoa, the following island states are now listed separately: Cook Islands, Niue, Tokelau, Federated States of Micronesia, Kiribati, Republic of Marshall Islands, Nauru, Solomon Islands, Palau, Tonga, Tuvalu, and Vanuatu. 4 UNCT Algeria reported in 2010 the decision to have postponed the implementation of HACT.


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23. As 36 countries did not report on their implementation status in the recent update, the following analysis includes the most recent update from those countries in previous years in order to have a more accurate and comprehensive snapshot of the overall implementation status. Seven countries have not reported to the global annual update since 2008. Therefore, the basis for any average and percentage calculation in the following will be the 143 countries, from which information could be retrieved for the purpose of this assessment.5

24. A total of 15 UNCTs reported that HACT is not applicable for their country.6 Following the total of 143 countries considered this corresponds to a rate of 10.5%. 19 countries reported to have received deferrals for the implementation of HACT from their Regional UNDG Team (13.2%). An additional 13 countries reported to have postponed the implementation of HACT through UNCT decision (9%). In result, this means that 47 or 32.9% of all listed countries reported that they do not implement HACT, either because it is not applicable for their country in the first place or because the implementation has been postponed.7

25. Altogether, 33 countries reported being fully HACT compliant, which corresponds to an implementation rate of 23%.8 This is an increase of more than 14% over the previous year, in which 11 out of 136 countries reported to be fully HACT compliant.9 The sharp increase of HACT compliant countries from 2010 to 2011 comes mainly from adding 12 small islands states to the list, which were previously integrated into Fiji and Samoa. In addition to Fiji and Samoa, which reported being fully HACT compliant for the first time in the recent update, six of the small island states also reported full HACT compliancy.10 Overall and since the global annual update in 2008, the rate of countries fully HACT compliant increased from 6% to 23%.

26. However, the detailed review of the global annual updates revealed that the data needs to be read and interpreted with the greatest care. For example, some countries that have reported being fully HACT compliant also report not having completed either micro assessments, macro assessments, assurance and audit plans or any combinations of these steps. Other countries that reported not being fully HACT compliant, stated to have completed all steps, including assurance and audit plans for their

5 The seven countries without information available are Chad, Mali, Sao Tome & Principe, Nauru, Romania and recently added Seychelles and South Sudan. 6 Arab States: Bahrain, Libya, Occupied Palestinian Territories, Saudi Arabia, Somalia, Tunisia, UAE & Qatar; Asia & Pacific: DPR Korea; Europe & CIS: Bulgaria, Latvia, Lithuania, Poland, Russia, Ukraine; Latin America and Caribbean: Trinidad & Tobago, Venezuela. (Kuwait and Iraq reported in 2010 that HACT is not applicable, however changed this in 2011. While no further update was received from Kuwait, Iraq has established a task force and reported to have finalized a macro assessment.) 7 It is important to note that many countries that have either received a deferral from the Regional UNDG Team or postponed HACT implementation through UNCT decision have initiated or completed steps towards HACT compliance, including macro assessments, micro assessments, and the use of the FACE form. 8 All countries stating to be fully HACT compliant reported in 2011, except for Kenya (2008) and Indonesia (2008). Although Samoa and Guatemala reported to be fully HACT compliant in 2011, they are not counted here as they also stated to have received a deferral from their Regional UNDG Teams. In addition, Guatemala did not confirm to have an assurance and audit plan. 9 Uruguay and Malawi reported full HACT compliance in 2009 and did not report in 2010. Morocco, Laos and Colombia reported full HACT compliance in 2009, however did not confirm to have completed micro assessments. In 2011, Laos reported to have completed all micro assessments and is fully HACT compliant. Morocco and Colombia reported to be not HACT compliant. 10 Cook Islands, Niue, Tokelau, Kiribati, Solomon Islands, and Vanuatu.


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implementing partners. Supported by numerous comments and queries from focal points at country level and also by the results of the global online survey, there are many different interpretations as to when a programme country would reach a status of full HACT compliance.11 This results to some extent in contradictory information in the global annual updates as they are subject to unverified self-reporting. However, the data proves to be extremely useful in reflecting the overall implementation status at a particular point in time, analyzing trends since the introduction of HACT and identifying regions and countries that need particular attention and support.

27. Figure 3.1.1: HACT Implementation by Region

*Source: 2011 Global Annual Update (UN DOCO)

28. As mentioned above, 32.9% of all listed countries reported not having implemented HACT, either because HACT does not apply to their country or because the implementation has been postponed. While taking stock of the data, it will be imperative to identify for which countries and why HACT is not applicable as well as the reasons for UNDG confirmed deferrals and UNCT decided postponements of HACT. As there are no standardized procedures in place to determine the applicability of HACT in the first place or to support UNCTs in their decision-making process to postpone implementation, UNCTs and Regional UNDG Teams base their decisions on a very individual interpretation of particular country-level circumstances.

29. So far, all 143 considered countries have been taken into account in the analysis of the global annual update. Taking into consideration that 47 countries are not implementing HACT for reason or another, the further analysis shall be based on the total of 96 listed countries that are in the process of implementing HACT. This ensures that percentage numbers accurately refer to the group of HACT implementing countries and not the overall number of listed countries, although almost one third of all countries do not work on the implementation of HACT. From the group of 96 implementing programme

11 See Annex II, Online Survey, Questions 15 and 16.

22 24

18

36

24 26

17

1310

27

13 16

0 0

6

1

6 20

6

0

61

632

21

3 2

05

10152025303540

E/S Africa W/C Africa Arab States Asia/Pacific Europe/CIS LAC

No. of Countries HACT Impl. Countries HACT Not Applicable

UNDG Deferral UNCT Postponed


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countries, 84 countries have reported to the recent update, increasing the reporting rate from 76% of all listed countries to now 87.5%. Thirty-one countries reported being fully HACT compliant, corresponding to a rate of now 32.3%. As we mentioned the significant weaknesses of relying on the self-reported status of overall HACT compliance, the following analysis distinguishes between reporting on the agreement with government, macro assessment, micro assessment, and assurance and audit plans.12

3.2 Capacity Assessments and Assurance Activities

3.2.1 Implementation Status of Capacity Assessments 30. From the 96 HACT implementing countries, 82 reported to having an agreement with the government

on HACT implementation either through the CPAP or exchange of letters (85.4%). Eighty-six countries reported having completed a macro assessment or assumed ‘high risk’ category (89.6%). It is interesting to note that there is less of an overlap between countries with government agreement and completed macro assessment than these numbers suggest. While six countries that have reached an agreement with the government to implement HACT did not yet complete a macro assessment, ten countries reported having completed a macro assessment, without an existing agreement with the government. This suggests that the reported data needs to be interpreted carefully as conducting a macro assessment without an agreement between the UN and the host government on its applicability is very unlikely. 13

31. From the remaining 11 programme countries, which are counted to have neither an agreement with the government nor completed a macro assessment, only two countries reported to the recent update. As mentioned above, seven countries have never reported on any global annual update in the past four years. Among these countries are newly listed South Sudan, Seychelles, Nauru and Romania (for which HACT is likely not applicable as it joined the European Union in 2007).14

32. From the 86 countries that reported having completed a macro assessment, 57 countries reported having either completed micro assessments or assumed ‘high risk’ category for their implementing partners. In addition to this, Burkina Faso, Eritrea and Ethiopia reported having completed micro assessments, without having conducted a macro assessment. However, this information could be outdated as Burkina Faso last reported in 2010 and Ethiopia in 2008. With 60 countries having

12 Guatemala and Samoa reported being fully HACT compliant, however also reported having received a deferral for HACT from their Regional UNDG Team. Therefore, they are not counted as countries implementing HACT. 13 Countries with government agreement and not yet completed a macro assessment: Eritrea, Ethiopia, Burkina Faso, Egypt, Iraq, and Syria. Countries with completed macro assessment and no government agreement: Gabon, Pakistan, Palau, Tuvalu, Azerbaijan, Argentina, Belarus, Tajikistan, Turkey, and Barbados&OECS. 14 Programme countries that have never reported to the global annual update: Seychelles, South Sudan, Chad, Mali, Sao Tome & Principe, Nauru, and Romania.


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completed micro assessments or assumed ‘high risk’ category for their implementing partners, 62.5% of all HACT implementing countries have achieved this step in the HACT implementation process.

33. A particular additional challenge seems to be the implementation of assurance and audit plans as only 44 countries reported having completed this step, corresponding to an implementation rate of 45.8%. From this group, Jamaica, Kosovo and Peru reported that they did not complete micro assessments.15 Overall and in accordance with the data provided by recent and previous global annual updates, a total of 38 countries reported having a government agreement, conducting macro and micro assessments and implementing an assurance and audit plan. This corresponds to a rate of 39.6% of all HACT implementing countries and 26.6% of all listed countries.16

3.2.2 Implementation Status of Assurance and Audit Plans

34. The analysis of UN DOCO’s global annual updates reveals that it seems to be particularly challenging for HACT implementing countries to implement assurance and audit plans, even after having completed macro- and micro assessments. While the data does not distinguish between agency-specific or joint assurance and audit plans, a lot of the relevant comments lead to the conclusion that designing and implementing a joint assurance and audit plan is challenging due to the necessary coordination between agencies in the process of harmonizing related business practices.

35. Figure 3.2.1: Reported Progress of HACT Implementing Countries by Region


15 Burkina Faso, Eritrea and Ethiopia reported to have implemented micro assessments and assurance and audit plans without having finalized the macro assessment. 16 From this group, only two countries did not report in the recent update, namely Indonesia (reported 2010) and Kenya (reported 2008). Therefore, the information can be considered to be relatively accurate.

1713

10

27

1316

1310 9

24

9

1414

10

6

27

1316

14

10

4

16

6

1097

3

16

36

0

5

10

15

20

25

30


HACT Impl. Countries Government Agreement Macro Assessment

Micro Assessment Assurance/Audit Plan


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36. The most recent update shows that from the 57 countries that reported having completed macro and

micro assessments, only 38 countries reported having completed an assurance and audit plan. This corresponds to a rate of 66.7%. While this cannot be considered a high rate, the number of completed assurance and audit plans still increased from a reported 12 in 2010 to 38 in 2011. As only 29 countries reported having completed macro- and micro assessments in 2010, this is a dramatic increase of completed assurance and audit plans in one year, which follows a period of relative stagnation at an average rate of 45% since the global annual update in 2008.

37. Since the risk ratings of implementing partners as the result of the micro assessments establish different assurance and audit activities by the agencies, the still relatively low level of established assurance and audit plans in comparison to completed micro assessments is concerning. This has been confirmed by the recent audit report of the joint HACT audit in Malawi, where the lack of an assurance activities plan raised major concerns about the overall HACT implementation.17 On the other hand, it seems to be the case that in many programme countries, the HACT implementing agencies have only a very small number of common implementing partners. This might lead to a limited incentive for agencies to harmonize their assurance and audit plans or jointly conducting any assurance activities.18

3.3 Reported Implementation Status Related to Specific Country Groups 38. Considering the low implementation rate, it is evident that there are specific bottlenecks and

challenges in each step of the process towards full HACT implementation. Recent feedback from country offices to UN DOCO on reasons for challenges and bottlenecks in the implementation of HACT suggests that the lack of capacity in national institutions is one of the main challenges. A comment from Djibouti states that national counterpart staff would have to be trained in various aspects of project management and execution. Further, the United Nations would need to advocate for transparent internal control systems promoting accountabilities, segregation of duties, and a clarification of individual roles within the Ministries and technical departments.

39. Ethiopia commented that the very low implementation capacity of partners constitutes a major challenge. This is supported by arguments from Equatorial Guinea, which found the environment at the country level to be mainly responsible for the delay of HACT implementation. The feedback provided by Namibia solely targets the implementing partner side. It states that implementing partners lack capacity to handle large volumes of funds in advance as they cannot distinguish between the sources of funds, lack general understanding, and have no adequate reporting systems.19

17 Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.11 18 This observation is supported by the list of implementing partners divided per agency in the recent Impact Assessment Study of HACT in Mozambique. (Annex 5, p.44: List of onsite reviews conducted between 2008 and 2009.) 19 Responses from Country Offices on reasons/bottlenecks for the implementation of HACT. (UN DOCO)


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40. In summary, comments describing the lack of government capacity as one of the main challenges of HACT implementation are mainly coming from economies either belonging to the group of Least Developed Countries (LDC) or Low Income Countries (LIC). This suggests that the implementation of HACT could be dependent on a minimum institutional capacity at the implementing partners’ level in order to meet the requirements for successfully managing funds and reporting in accordance with the applicable risk rating. While categorizing countries into groups of LDCs or LICs has only a limited relevance in determining the capacity of government institutions, in this assessment it serves to test the possible conclusion that HACT – with its requirement to move from a control-based to a risk-based financial management system – might not be suitable for LDCs or LICs. To verify whether this hypothesis is supported by the data of the recent global annual update, the HACT implementation status of the LDCs and LICs have been compared to the status of all other programme countries.

3.3.1 Implementation Status and the Group of Least Developed Countries

41. According to the UN Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries, and Small Island Developing States (UN OHRLLS), the identification of LDCs is currently based on three criteria: per capita gross national income (GNI), human assets, and economic vulnerability to external shocks.20 Amongst others, the low level of socio-economic development is characterized by weak human and institutional capacities. To be included in the list of LDCs, a country must satisfy all three criteria. In addition, since the fundamental meaning of the LDC category – i.e. the recognition of structural handicaps – excludes large economies, the population must not exceed 75 million. The current list of LDCs includes 48 countries: 33 in Africa, 14 in Asia and the Pacific and one in Latin America. Haiti, the only LDC from Latin America, has postponed the HACT implementation through UNCT decision.21

42. Thirty two out of the 96 HACT implementing countries belong to the group of LDCs (33.3%). From this group, four countries have never reported to the global annual update, hence will not be taken into account in this analysis.22 From the 28 relevant countries, 27 reported having an agreement with the government on the implementation of HACT (96.4%), 25 countries reported having completed a macro assessment (89.3%), 23 countries reported having completed the micro assessments of implementing partners (82.1%), and 16 countries reported having implemented an assurance and audit plan (57.1%). As shown in table 3.3.1, LDCs are noticeably ranging above the overall average in all steps of the HACT implementation process. It seems that the HACT implementation in LDCs might lead to higher transaction costs compared to other countries, due to the likelihood of greater challenges in regards to the existing institutional and human capacity. However, amongst the group of HACT implementing countries, the global annual updates show that there is no indication that LDCs are principally less

20 See OHRLLS website for a more detailed description of LDC criteria at http://www.unohrlls.org/en/ldc/related/59/ 21 See OHRLLS website for a complete list of LDCs and LDC country profiles at http://www.unohrlls.org/en/ldc/25/ 22 South Sudan, Chad, Mali and Sao Tome & Principe.


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successful in implementing HACT. With LDCs clearly ranging above the average implementation rates, the available data disproves the argument that the applicability of HACT for LDCs should be reviewed.

43. Table 3.3.1: HACT Implementation Status – HACT Implementing LDCs versus non-LDCs

44. The results are different when adding to the analysis those countries where HACT is currently not implemented. There are 18 LDCs in the group of 47 countries not implementing HACT because HACT is not applicable or has been postponed through a UNDG deferral or UNCT decision. Corresponding to a rate of 38.3%, this is slightly above the average of LDCs amongst all 147 countries at 32.1% (46). The picture sharpens when deducting those countries where HACT is not applicable. As this group of 15 countries includes only one LDC – Somalia – it seems that there is a higher tendency for country teams in LDCs, when compared to other countries, to seek a deferral from their Regional UNDG Team or to postpone the implementation of HACT through UNCT decision. From a total of 46 LDCs, 17 countries or 37% opted not to implement HACT. While 14 non-LDCs reported that HACT is not applicable for their country, the ratio for the remaining 83 countries is still much lower at 15 countries or 18.1%.

45. Table 3.3.2: HACT Implementation Status – HACT Implementing and Non-implementing Countries by LDCs versus non-LDCs

46. In summary, the group of HACT implementing LDCs is evidently more successful in all steps of the process, in comparison to other HACT implementing countries. However, and contradicting these

HACT Implementation

Indicators Number % Number % Number %

Number of Countries 96 100 28 29.2 68 70.8

Government Agreement 82 85.4 27 96.4 55 80.1

Macro Assessment 86 89.6 25 89.3 61 89.7

Micro Assessment 60 62.5 23 82.1 37 54.4

Assurance and Audit Plan 41 42.7 16 57.1 25 36.8

Programme Countries non-LDCsLDCs

HACT Implementation

Indicators Number % Number % Number %

Number of Countries 143 100 46 32.1 97 67.9

Implementing HACT 96 67.1 28 60.9 68 80.1

Not Implementing HACT 47 32.9 18 39.1 29 29.9

Not Applicable 15 31.9 1 5.6 14 48.3

UNDG Deferral 19 40.4 11 61.1 8 27.6

UNCT Postponed 13 27.7 6 33.3 7 24.1

Programme Countries LDCs non-LDCs


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findings, a much larger portion of LDCs opted to postpone the implementation of HACT in the first place. With almost 40% of all LDCs not implementing HACT, it seems that there is a tendency for UNCTs in LDCs in to postpone the implementation, supported by their Regional UNDG Teams. This, in turn, is not supported by the evidence from LDCs that actually implement HACT. The HACT Framework does not provide guidance on the circumstances that would justify a decision to postpone HACT implementation as it does not foresee any such cases. Therefore, UNCTs and Regional UNDG Teams are currently making decisions on deferring the implementation of HACT outside of the guidelines as stipulated in the HACT Framework.23

3.3.2 Implementation Status and Country Categorization by GNI 47. Dividing programme countries into LDCs and non-LDCs provides a way to verify whether the

development status of a programme country has an impact on the implementation of HACT. Another indicator allowing a more distinctive division of programme countries into four categories is gross national income (GNI) per capita. 24 The GNI is the World Bank’s main criterion for classifying economies and categorizes countries into low income, lower middle income, upper middle income and high income countries.25 While most LDCs are either low income or lower middle income countries, the categorization by GNI enables the identification of trends across all programme countries, particularly within the group of non-LDCs.26 For a detailed picture, the following table reviews HACT implementing and non-implementing countries by GNI category.

23 The amendment of the HACT Framework by criteria for UNCTs and Regional UNDG Teams to defer the implementation of HACT is supported by the findings of the ‘Joint Audit of the Harmonized Approach to Cash Transfers (HACT)’ in Malawi. Recommendation 5 stipulates that the macro assessment should result in a first-level determination of adopting HACT versus NEX audits, p.7. 24 Gross National Income per capita (GNI) is the sum of value added by all resident producers plus any product taxes (less subsidies) not included in the valuation of output plus net receipts of primary income (compensation of employees and property income) from abroad. GNI per capita is gross national income divided by mid-year population. GNI per capita in US dollars is converted using the World Bank Atlas method. UNICEF Definitions: http://www.unicef.org/infobycountry/stats_popup7.html; Word Bank: http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 25 Economies are divided according to 2010 GNI per capita. The groups are: low income, $1,005 or less; lower middle income, $1,006-$3,975; upper middle income, $3,976-$12,275; and high income, $12,276 or more. World Bank: http://data.worldbank.org/about/country-classifications 26 Out of 46 LDCs, 28 belong to the group of LICs, 17 to the group of LMICs and one to the group of HICs.

http://www.unicef.org/infobycountry/stats_popup7.html

http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

http://data.worldbank.org/about/country-classifications


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48. Table 3.3.3: HACT Implementation Status – HACT Implementing and Non-implementing Countries by GNI Categories

*Cook Islands, Niue and Tokelau are not considered in the GNI comparison as they are not classified by the World Bank.

49. According to the information in the table, 75% of all high income countries (HICs) are not implementing

HACT. The two HACT implementing HICs are Barbados & OECS and Kuwait, whereby both countries did not go beyond conducting a macro assessment. Most of the non-implementing HICs are net contributing countries, apart from Equatorial Guinea, which postponed the implementation of HACT per UNCT decision.27 With almost half of all non-implementing upper middle income countries (UMICs) being net contributing programme countries, the analysis confirms that economic development of a programme country seems to have no particular influence on the implementation of HACT. This is supported by the highest implementation rate of micro assessments and assurance and audit plans among the low income countries (LICs). At the same time, LICs have a high rate of UNDG approved deferrals. Compared to UMICs, it seems than LICs and lower middle income countries (LMICs) are more successful in implementing HACT. Deferral rates in all three categories are high, ranging from 25.4% to 39.4%. HICs have almost no significance in the HACT implementation process. This confirms the above findings on LDCs.

3.3.3 Reported Implementation Status of Delivering as One Countries

50. With their strong emphasis on inter-agency coordination some of the eight Delivering as One (DaO) countries have initiated and implemented considerable steps towards greater harmonization of business practices in programme and operations. This has been confirmed by the recent country-led

27 Equatorial Guinea can be considered an exception as it qualifies as a HIC due to its GNI of $14,540. At the same time, with an extremely unequal income distribution with more than 70% of the population living below the poverty line of $2/day, the country belongs to the group of LDCs.

HACT Implementation

Indicators Number % Number % Number % Number % Number %

Number of Countries 33 23.6 59 42.1 40 28.6 8 5.7 140* 100

Implementing HACT 20 60.6 44 74.6 27 67.5 2 25 93 66.4

Government Agreement 19 95 38 86.4 21 77.8 1 12.5 79 84.9

Macro Assessment 17 85 38 86.4 26 96.3 2 25 83 89.2

Micro Assessment 18 90 25 56.8 14 51.9 0 0 57 61.3

Assurance and Audit Plan 12 60 19 43.2 10 37 0 0 38 40.9

Not Implementing HACT 13 39.4 15 25.4 13 32.5 6 75 47 33.6

Not Applicable 2 15.4 2 13.3 6 46.2 5 83.3 15 31.9

UNDG Deferral 7 53.8 9 60 3 23.1 0 0 19 40.4

UNCT Postponed 4 30.8 4 26.7 4 30.8 1 16.7 13 27.7

LICs LMICs UMICs HICs Total Countries


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and independent evaluations of DaO and the UNDG-HLCM mission report which based its findings on visiting three DaO countries – Albania, Mozambique and Vietnam – and the DaO self-starter Malawi. The report states that progress has been made in all countries. However, challenges remain in terms of scaling up the HACT implementation more systematically by creating a sense of joint ownership and the implementation of joint activities, such as common LTAs for audits, training and assurance activities.28 The following table shows how the eight DaO countries reported on their HACT implementation status.

51. Table 3.3.4: HACT Implementations Status – Delivering as One Countries

*self-reported as per October 2011. Pakistan last reported in 2010.

52. Following the recent reporting of DaO countries to the global annual update, the increased emphasis on inter-agency coordination through the concept of One Programme, One Budget, One Office and One Leader seems to result in a higher level of HACT implementation compared to all other implementing countries. Again, LDC or low income status did not seem to have any particular influence on the implementation of HACT as even within the group of DaO countries, all LDCs and LICs report an advanced status, including the implementation of an assurance and audit plan. Except for Pakistan and Albania, which reported having received a UNDG approved deferral, all DaO countries reported having fully implemented HACT. Pakistan has not reported to the recent update but reported in 2010 that out of 121 implementing partners, only four are shared between two or more agencies. For example, in 2010 Mozambique reported having 12 shared implementing partners, Tanzania reported 17, and Vietnam reported 21. While a higher number of shared implementing partners is clearly an additional incentive for greater inter-agency coordination, Pakistan has not prioritized the implementation of HACT.

28 See ‘Addressing Country-Level Bottlenecks in Business Practices, High Level UNDG-HLCM Mission’ Mission Report, p.25.

DaO Countries

Name LDC GNI UNDG

DeferralGovernment Agreement

Macro Assessment

Micro Assessment

Assurance and Audit Plan

Albania UMIC √ √ √ √

Cape Verde √ LMIC √ √ √ √

Mozambique √ LIC √ √ √ √

Pakistan LMIC √

Uruguay UMIC √ √ √ √

Rwanda √ LIC √ √ √ √

Tanzania √ LIC √ √ √ √

Vietnam LMIC √ √ √ √

Total in % 50 12.5 87.5 100 87.5 75

Category HACT Implementation Status*


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53. Although Albania has received a deferral for the implementation of HACT, it still implements HACT and recently reported on the actual process. In the recent update, Albania commented that only a few government institutions wish to receive cash disbursements; many prefer direct execution by a UN agency or another managing institution, such as an NGO or profit oriented company. Albania, being a middle-income-country, has very few partners that receive more than US$ 100,000 annually combined from UN agencies. Those implementing partners that do receive more than that amount have been micro-assessed and report through the FACE form. In 2010, Albania reported having three shared implementing partners, but it does not have a joint assurance and audit plan in place.

3.4 Coordination and Management of the Global Annual Update 54. Providing a global annual update at headquarter level on the HACT implementation proves to be a very

good tool to monitor and interpret the progress of HACT at the country level. Divided by regions and the level of individual programme countries, the update allows a very detailed analysis of the reported data and their interpretation. While each programme country is different, the update makes it possible to recognize trends, identify the major challenges and analyze the overall status and particular issues in the six different regions. At the same time, it gives each programme country the opportunity to provide additional comments on any issue regarding the particular challenges and opportunities in the implementation process. In summary, the update provides an important regular snapshot of the HACT implementation status.

55. UN DOCO conducts the global annual update through the Regional Coordination Specialists for the countries of their regions. With a reporting rate of 76% and just over 60% from the African regions, the update does not cover all listed countries and is not able to provide a completely accurate and up-to-date snapshot of the HACT implementation status. While the reporting rate significantly increased in comparison to previous years, some programme countries still have never reported to the global annual update.29 The following findings highlight the reasons for the limited feedback from programme countries.

56. Although the global annual update has been carried out on an annual basis since 2008, it has not been

institutionalized by UN DOCO through the UNDG Regional Teams. The update has not been received by the Regional Coordination Officers and country office focal points as an integrative part of their responsibilities. In addition and as confirmed by the online survey, many countries do not have an inter-agency HACT focal point, which results in treating reporting on HACT as a low priority.

57. The list of 150 countries includes many countries where HACT is either not applicable or where

implementation was deferred in previous years. The global annual update targets all programme

29 Countries that have not reported to the global annual update since 2008: Chad, Mali, Nauru, Romania, Sao Tome & Principe, Seychelles, South Sudan.


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countries independent from their particular status. For example, there is no reference made to differences between HACT implementing countries, net-contributors, or European Union member states. This, in turn, leads to inaccuracies in statements about the implementation or compliance rate as it includes a significant number of countries where HACT is not applicable. Further, the recent increase of the number of countries – by adding seven small pacific island states – tends to shift overall results. It is important to take into account that the entire group of countries is managed by the UNCTs Fiji and Samoa under one common UNDAF.

58. The global annual update is based on self-reporting by programme countries. While ongoing communication between UN DOCO, the Regional UNDG Specialists, and country-level focal points clarifies some contradictory information, there are no established indicators that would standardize and verify the data. The absence of indicators potentially leads to a different interpretation of the requested data by many countries. For instance, as the HACT framework does not clearly define HACT compliance, the analysis of the updates in this assessment reveals that many countries have a different understanding of the requirements for HACT compliance. This finding is supported by the feedback through the online survey.30

59. While UN DOCO compiles and summarizes the reported information with significant workload over the course of several weeks, an analysis of the data and comments from country teams would allow for more detailed and comprehensive feedback to the UNDG HACT Advisory Committee, Regional UNDG Teams and UNCTs. Following this, the global annual update in its current form reveals a high degree of process orientation as there seems to be no strategic intent to use the provided information for achieving specific results in support of enhanced progress in HACT implementation. This is in accordance with the finding that the update requests information on data that leaves much room for interpretation, which results in the provision of often-contradictory information by country-level focal points. Further, the basis for calculating the published averages comprises 150 countries, including many countries that have not reported or in which HACT is not applicable or has been deferred.

30 See Annex II, Online Survey, Question 15 and 16.


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4 HACT Capacity Assessments

4.1 Government Agreement and Cooperation 60. As per the HACT framework, the main objective of implementing HACT is to gradually shift to utilizing

national systems by focusing more on strengthening national capacities for management and accountability. At the same time, the implementation of a common operational framework for transferring cash would result in a significant reduction of transaction costs for both UN agencies and implementing partners. While UN agencies would coordinate their actions and harmonize assessments and assurance activities, implementing partners would profit from the common forms and procedures for requesting cash and reporting on its utilization.31

61. While the HACT framework assumes positive effects in terms of capacity development and transaction cost reduction, it does not provide guidance on cases where governments would not agree to some of the terms and conditions of implementing HACT. According to the analysis of the global annual updates, 32.9% of all listed countries are not implementing HACT, many based on government decision. In addition, a number of implementing countries face significant challenges with government cooperation during the implementation process. The following findings address the reported challenges, many of which are connected to the requirement of capacity assessments as the basis of HACT implementation.

62. Together with the assurance and audit activities, the capacity assessments build the core of the HACT approach. According to the HACT framework, the macro and micro assessments serve two main objectives:

• Development objective: Helping agencies and the government to identify strengths and weaknesses in the public financial management system and the financial management practices of individual implementing partners, and identify areas for capacity development.

• Financial management objective: Helping agencies to identify the most suitable resource transfer modality and procedures, and scale of assurance activities to be used with each implementing partner.32

While the capacity assessments do not establish any conditionality for assistance from agencies, they determine the cash transfer modality and the frequency and coverage of assurance activities. While the risk ratings low, moderate, significant and high as a result of the micro assessments drive assurance activities, they also serve to identify the capacity development needs of individual implementing partners.

31 The HACT framework states that the adoption of this harmonized approach is a further step in implementing the Rome Declaration and Paris Declaration on Aid Effectiveness, which call for a closer alignment of development aid with national priorities and needs. See ‘Framework for Cash Transfers to Implementing Partners’, p.2. 32 See ‘Framework for Cash Transfers to Implementing Partners’, p.4.


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4.1.1 Government Agreement and Challenges at the National Level

63. Agreement between the UN and the government on the implementation of HACT is reached either by the inclusion of clauses related to the particular cash transfer modalities and procedures into the CPAP or by a separate agreement in such cases where implementing partners are not covered by a CPAP. The HACT framework provides a standard text to be used by all agencies, which spells out the terms and conditions of HACT implementation – namely payment modalities, assurance activities and the commitments of UN agencies and government.33 According to the information from the global annual updates and additional feedback from programme countries, many governments have not agreed to the HACT modalities and, as a result, have not signed the CPAP or refrained from other related agreements.34

64. There are three main reasons for governments to oppose the implementation of HACT. First, the systematic approach through capacity assessments and assurance activities at the institutional level is interpreted as interfering in national sovereignty. Second, net contributing countries (NCC) or those with a high amount of third-party cost sharing consider themselves to a large extent as partners for development rather than recipients of financial resources through UN agencies. Therefore, terms and conditions as stipulated by the HACT framework are perceived to introduce unnecessary accounting and reporting obligations. Third, the Public Financial Management (PFM) system is based on legislation that does not foresee cash transfer to implementing partners.

65. While one of the main objectives of HACT implementation has been described as supporting national systems, its approach to achieve the development and financial management objective through a series of capacity assessments and assurance activities at the institutional level earned considerable opposition from a number of governments. As stated by UN HACT focal points from several countries, governments do not regularly differentiate between the concepts of capacity assessments and audits. While the capacity building objective is widely supported, the instruments to identify capacity gaps and apply risk ratings – as well as introduce regular assurance activities – have been repeatedly perceived as a considerable interference at the institutional level. In accordance with the findings from the global annual updates, responses to the online survey and other documentation, this viewpoint is shared by countries from both the group of NCCs as well as the group of LMICs and LICs.35

33 See ‘Framework for Cash Transfers to Implementing Partners’, Annex V, p.42. 34 See Annex II, Online Survey, Question 23: Comments on Section Macro Assessment; ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO); ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 35 Please refer to the following country examples: Venezuela (UMIC), which is not a signatory to the Paris Declaration, did not agree to HACT. Cuba (UMIC) has declared that HACT would constitute interference in national sovereignty. Brazil (UMIC and NCC) and Mexico (UMIC and NCC) did not agree to auditing government institutions as part of HACT implementation. However, Mexico has agreed to HACT implementation for NGOs. In Turkey (LMIC), ongoing high level communication at the ministerial level has not led to an agreement to implement HACT. Eritrea (LIC and LDC) has not agreed to the macro assessment. Uzbekistan (LMIC) has declared that it principally does not share financial information and records with external parties. Therefore, macro and micro assessments have become impossible to conduct. Togo (LIC and LDC) has not accepted the findings of the macro assessment. Argentina (UMIC and NCC) has not accepted the findings of a recently conducted macro assessment. Iran (UMIC) has not agreed to macro or micro assessments. In the Central African Republic (LIC and LDC), the macro assessment for the coming cycle 2012-2016 has been delayed pending approval from the government. See Annex II, Online Survey, Question 23: Comments on Section Macro


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66. As the HACT framework does not foresee or clarify circumstances under which HACT is not applicable,

UNCTs have no clear reference or guidance on how to approach HACT in NCCs with a high amount of third-party cost sharing. While in the recent global annual updates several NCCs have been categorized as “HACT not applicable,” UNCTs in other NCCs have communicated with the government to start the implementation process. With no qualifying indicators deciding on the applicability of HACT, it appears that some UNCTs have turned to the UNDG Regional Teams on a case-by-case basis to opt out of the implementation of HACT. For example, the UNCT Libya has requested and obtained exemption for implementation of HACT as more than 95% of the funding originated from the government and there were no cash transfers. In addition, the government was very sensitive to audit activity in the form of macro and micro assessments.36

67. Tunisia also reported as “HACT not applicable” in the recent global annual update as the value and relevance of HACT as a tool for aid coordination would be limited. First, UN funding in Tunisia to government partners is limited and does not exceed US$100,000 per implementing partner. Second, in cases where different agencies work with the same partner, the UN in Tunisia has moved to joint programming in which joint mechanisms different from HACT are decided in the programme document. Third, Tunisian government financial regulations do not allow most government partners to open bank accounts, so there is limited use of advances and a greater use of the direct payment modality. This means assurance and audit activities over government partners are limited because partners are not directly managing resources.37

68. There are several countries, where the PFM system is not conducive to cash transfers to implementing partners. For example, in Ecuador direct payments or reimbursements are not applicable due to the requirement of governmental entities to certify the availability of cash flow in the national treasury before issuing a contract and/or a payment. In Bolivia, financial laws do not foresee direct payment or reimbursement as a cash transfer modality. In Costa Rica, all cash transfers from the UN and other international development partners are to be deposited into one source account. Therefore, transfers to implementing partners are not possible. The current legislation in Uzbekistan on NGOs does not allow them to receive financing directly from donor organizations, therefore preventing the implementation of HACT. In addition to overall weak capacities, Uzbekistan does also not share any financial information and records with external parties.38

69. In Azerbaijan, the legislation of the PFM system does not permit development partners to make financial contributions to government bank accounts. Following this, implementing partners would have to put into operation parallel bank accounts for cash transfers from the UN. According to the

Assessment; ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO); ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 36 See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO). 37 See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO). 38 See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO); ‘Country Comments: 2011 Global Annual Update’ (UN DOCO).


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HACT task force in Azerbaijan, this would undermine the objectives of HACT to significantly reduce transaction costs for national partners and increase the use of national systems.39

70. Following the financial legislations in Kazakhstan, government implementing partners at the ministry level are not allowed to operate bank accounts in order to receive and account for funds from the UN. They are obliged to use the national treasury system, which is not equipped to track funding received from the UN in a way that it could correctly account for expenditures separated by implementing partners. As a result, the provision of periodic reports and funding requests through the FACE form cannot be ensured. Therefore, UNDP Kazakhstan uses the direct payment modality for these implementing partners, which have not been micro assessed as they are not receiving and accounting for cash.40

71. The above examples of different PFM legislations in programme countries indicate that the application of cash transfer procedures as specified in HACT framework would actually lead to increased transaction costs for the government. Changes in respective PFM legislations to allow for certain cash transfer modalities would potentially contradict the main objective of increasingly using national systems. The example of Kazakhstan is noteworthy as it resembles similar challenges in a number of countries with programmes and projects that have third-party cost sharing modality. While the HACT framework requires reporting through the FACE form also for the direct payment modality, controls are automatically established as the implementing partner is not subject to any cash transfer.41

4.1.2 Challenges at the Implementing Partner Level 72. The findings in regards to the national level indicated the most imminent reasons for governments to

object to the implementation of HACT. The review of comments in the online survey and the global annual update revealed that many countries face challenges at the implementing partner level during the HACT implementation process. The main reasons for this lie in the procedures of the micro assessment. While the macro assessment is the result of a desk review of available reports, the micro assessment requires the engagement of an audit/consulting firm to directly assess the financial management capacity of implementing partners. This requires a high degree of understanding of the HACT concept and a significant level of cooperation to generate and provide internal organizational and financial information.42

39 In the recent global annual update, Azerbaijan reported to be in the process of receiving government agreement. So far, only the macro assessment has been conducted. It was pointed out that there is a lack of convincing arguments to prove the practicality of HACT in countries like Azerbaijan where the public management system does not allow development partners to make financial contributions to government bank accounts. See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 40 See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO). 41 A number of country offices confirmed that it is difficult to report direct payments with FACE. See ‘Framework for Cash Transfers to Implementing Partners’, p.7. 42 Practitioners from the following 36 countries have commented that they experienced challenges or that their biggest challenge is cooperation at the implementing partner level (including some countries not implementing HACT): Afghanistan, Angola, Argentina, Bangladesh, Belarus, Bolivia, Brazil, Cameroon, Central African Republic, Ecuador, Egypt, Ethiopia, Fiji, Guinea-Bissau, India, Iran,


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73. Many UN agencies have considerable difficulties with the fact that the micro assessment and recurring assurance activities are not similar to audits, but serve to assess the capacity to support the implementing partner on the path to reduce transaction costs and gradually increasing the use of national systems. Comparing this reasoning with the approach to the micro assessment and the details of the financial management questionnaires as per the HACT framework leaves little doubt that implementing partners often perceive the micro assessment as an audit of the institution particularly because the micro assessments are mostly conducted by third-party audit firms. At the same time, it seems not feasible to reduce any of the required information in the questionnaires as the information is necessary to apply accurate risk ratings.43

74. Comments from a number of countries describe as the biggest challenge that the government has not been convinced of the purpose of the micro assessment. In particular, government representatives do not believe that the contracted audit/consulting firm has the authority or capacity to carry out the exercise. Hence, there is often significant opposition to the results of the assessment and the associated risk rating. As these assessments do not result in changes in the cash transfer modality but determine the assurance activities, the effort to undergo micro assessments at the implementing partner level is seen as disproportionally high.

75. As a result, it has been observed in a number of countries that there is very limited cooperation at the implementing partner level, leading to significant hindrances in the execution of micro assessments and assurance activities. In many cases, government officials were unwilling to provide access to financial records and data. Also, government policies and procedures have led to major delays in executing micro assessments and assurance activities. For example, implementing partners have on several occasions referred to non-disclosure policies for government financial records. In this regard, a comment from one country described that not the implementing partner, but the UN agencies were required to obtain approval at the ministry level to allow the disclosure of financial records of individual implementing partners.44

76. It is evident that in numerous countries government officials at the national and implementing partner level have not embraced the HACT concept as an attractive cash transfer mechanism. It would be incorrect to conclude that challenges occur only where the concept and its long-term objectives have not been fully understood by government counterparts. In particular, in a national execution environment, where most of the cost sharing funds managed by the UN come from the local government, the position of the UN to assess government entities at the institutional level potentially raises political concerns about the nature of the partnership between the UN and the government. In addition to several comments in the global annual updates, this has also been confirmed through the

Kyrgyzstan, Maldives, Mexico, Nepal, Nicaragua, Nigeria, Pakistan, Peru, Philippines, Saudi Arabia, South Africa, South Sudan, Sierra Leone, Tajikistan, Tanzania, Thailand, Turkey, Turkmenistan, Ukraine, Uruguay, Vietnam. See Annex II, Online Survey, Question 25: Comments on Section Micro Assessment; ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO); See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 43 See ‘Framework for Cash Transfers to Implementing Partners’, Annex III, p.20-34. 44 See Annex II, Online Survey, Question 25: Comments on Section Micro Assessment (Nigeria).


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discussion with focal points and programme officers from country offices, who experience particular sensitivities in regards to the assessments at the institutional level. This has not been the case with project related controls and audits as, from the government perspective, there is a direct link between activities and expenditure control.

77. In this regards, it needs to be noted that funds routed through a UN organization fall under its full

responsibility and accountability, even if those funds were provided by the national government. Therefore, the argument that – particularly in NCCs – HACT would impose unnecessary financial assessments at the implementing partner level has to be interpreted under this important aspect. As such, it is imperative that the UN establishes tools which aim at managing the risk of safeguarding the utilization of government funds, also if they are further transferred to government agencies and their departments for implementation of activities.

78. The review has shown that incentives for governments to agree to and fully support HACT have not been sufficiently outlined. From a government standpoint, the introduction of HACT is accompanied by very high entry costs in terms of full financial and organizational disclosure at the directorate and/or departmental levels. Risk ratings applied by third-party audit/consulting firms expose capacity gaps and organizational weaknesses and lead to recurring assurance activities in the form of spot checks and audits. Seeing a direct link between the introduction of these profound measures and increasing national ownership as per the Paris Declaration on Aid Effectiveness is understandably challenging.45 While the HACT framework underlines that the approach allows efforts to focus on strengthening national capacities and a significant reduction of transaction costs, it does not go beyond a description of technical procedures of how to conduct assessments or request and report expenditures. Apart from the HACT framework, there is no concrete outline on how capacity would effectively be increased and how much the implementation of HACT would save in transaction costs on the government side.

4.2 Macro Assessment

4.2.1 Objectives of the Macro Assessment 79. According to the HACT framework, the macro assessment aims to ensure adequate awareness of the

PFM environment, in which agencies are to provide cash transfers to implementing partners. The macro assessment is expected to be undertaken once per programme cycle, preferably during the Common Country Assessment (CCA) preparation. The findings of the macro assessment should provide information that will serve as a good basis for conducting micro assessments at the implementing partner’s level. The macro assessment examines and interprets already existing PFM assessments and other available diagnostic work, therefore is not intended to be the result of original research. An

45 As per the HACT framework, the rationale for the introduction of HACT is to ensure a further step in implementing the Rome Declaration on Harmonization and the Paris Declaration on Aid Effectiveness, which call for a closer alignment of development aid with national priorities and needs. See ‘Framework for Cash Transfers to Implementing Partners’, p.2.


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important aspect of the macro assessment is that it should be undertaken in cooperation between UN agencies and government, covering the areas of national budget and execution process, functioning of public sector accounting and internal control mechanisms, audit and oversight, and financial recording systems and staff qualifications. 46

80. Annex II of the HACT framework provides guidelines for the review of a country’s PFM system. The guidelines stipulate that agencies will examine and interpret existing assessments of the PFM system as part of the CCA process. The macro assessment is conducted through a desk review by applying the findings on a checklist with eleven indicators, resulting in a risk rating per indicator of low risk, moderate risk, significant risk, or high risk.47 The HACT framework stipulates that the macro assessment should be conducted before any harmonized cash transfer procedures are applied and that a summary of the assessment should be incorporated into the CCA. Further, its findings should discussed at the UNDAF Prioritization Retreat to make sure that any interventions that agencies may agree to undertake to address the identified capacity gaps could be reflected in the UNDAF Results Matrix.48 The macro assessment serves two purposes, namely a capacity development objective and a financial management objective. The capacity development objective aims to identify strengths and weaknesses in the PFM and areas for capacity development by the government and others. The financial management objective aims to establish the appropriate cash transfer modalities, procedures and assurance activities to be applied by the agencies.49

81. One particular aspect of the macro assessment goes beyond the general goal to provide information about PFM capacities as a basis for decisions made as a result of the micro assessments. The HACT framework points out that the macro assessment is used to determine whether the national audit system is suitable to conduct the required audits of implementing partners receiving cash transfers. In particular, the macro assessment should establish the capacity of the Supreme Audit Institution (SAI) to undertake audits of cash transfers.50

4.2.2 Challenges Related to Macro Assessments 82. As per the data of the global annual updates, from the 96 HACT implementing countries reporting, 86

countries reported having completed a macro assessment or assumed ‘high risk’ category (89.6%). In comparison to other steps in the HACT implementation process, the macro assessment is much less challenging in terms of required inter-agency coordination and transaction costs. As part of the CCA/UNDAF process, the assessment consists of a desk review of existing evaluations of the PFM system and is typically carried out by an independent consultant. Necessary inter-agency coordination

46 See ‘Framework for Cash Transfers to Implementing Partners’, p.3-5. 47 See ‘Framework for Cash Transfers to Implementing Partners’, Annex II, ‘Checklist for Determining Risks Related to a Country’s PFM’, p.17. 48 See ‘Frequently Asked Questions – Harmonized Approach to Cash Transfer’ (UNDG 2009), p.12. 49 See ‘Framework for Cash Transfers to Implementing Partners’, Annex II, p.14. 50 See ‘Framework for Cash Transfers to Implementing Partners’, Annex II, p.15.


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to conduct the macro assessment is usually limited to the technical elements of the procurement process by selecting a lead agency and determining the cost sharing modality. As the methodology of the macro assessment relies on a desk review of existing material, rather than generic research, the scope of the exercise is limited, resulting in relatively low transaction costs.51

83. Although the macro assessment should take place as part of the CCA/UNDAF process, the feedback to the online survey from a number of countries confirmed that it is often carried out after the UNDAF has been signed.52 While it is mandatory to conduct the macro assessment, it does not seem to be among the priorities in the CCA/UNDAF process. In accordance with the feedback received, practitioners do not follow the understanding as outlined in the HACT framework that the macro assessment is a vital step in the CCA/UNDAF process or that its results are important for the UNDAF formulation. In addition, there is no common understanding of its capacity development or financial management objective, indicating that the results of the macro assessment would have a direct impact on determining the cash transfer modality or assurance activities. In this regards, the findings of the macro assessment are often not integrated into the HACT implementation process. Different from the intention in the HACT framework, the feedback from countries confirms that the macro assessment is often a stand-alone activity with no measureable impact on either building capacity of the PFM system or the HACT implementation process.53

84. Selected countries pointed out that it would be most useful to rely on multi donor assessments such as Public Expenditure and Accountability (PEFA) reports, rather than on stand-alone macro assessments. In the context of the aid effectiveness agenda and the programming process, the use of those reports would be more appropriate. In addition, the macro assessment would be too general to lead to any concrete activities not already covered by other donors, including the World Bank. Additional comments support this argument as they point out that the UN does not engage in the PFM system at the macro level. Therefore, the UN’s follow-up would be limited to asking the government how it intends to move in the areas as identified by the macro assessment. Following the feedback from programme countries, many practitioners seem to find the objectives of the macro assessment hypothetical as UNCTs are not addressing the findings, because they are not in line with the corporate priorities of any UN agency. This, in turn, leads to a low prioritization of the macro assessment on the UNCT agenda of many countries.54

85. Apart from questioning the value added of the macro assessment in the CCA/UNDAF process, it is evident that the findings of the macro assessments are linked to the HACT implementation process only to a limited extent. Comments from several countries identify difficulties in translating the findings of

51 For example, Mozambique confirmed total costs of the 2007 macro assessment to be about US$1,800. See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.29. 52 For example Uganda, Sierra Leone, Nepal, Zambia, Angola, Cote d’Ivoire, Burundi, Liberia, Sudan, Maldives, Central African Republic, Nicaragua, Eritrea, Ukraine, Kyrgyzstan. See Annex II, Online Survey, Question 23: Comments on Section Macro Assessment. 53 See Annex II, Online Survey, Question 23: Comments on Section Macro Assessment. 54 See Annex II, Online Survey, Question 23: Comments on Section Macro Assessment (Sierra Leone, Vietnam, Pakistan, Rwanda, and Tanzania), Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.7.


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the macro assessment into capacity development-related activities. While some of the comments confirm that it is challenging to address the gaps identified, 32.1% of the respondents of the online survey stated that the findings of the macro assessment were either not at all or only marginally integrated into the HACT implementation plan/work plan. However, the answers to this question did not result in a clear trend as 9.4% answered that the findings are fully integrated and a further 19.5% answered that the findings are to a large extent integrated into the HACT implementation plan/work plan.55 For example, findings of the macro assessment have resulted in decisions on the engagement of independent audit firms instead of the SAI in relevant countries. As intended by the HACT framework, the macro assessment has helped to determine whether the national audit system is suitable to conduct the required audits of implementing partners receiving cash transfers.56

86. According to the HACT framework, the findings of the macro assessment inform about existing capacity gaps in the PFM system, which lead to decisions on the utilization of the SAI for HACT audits and capacity development and assurance activities. In its current form, the macro assessment is not designed to inform about the applicability of HACT, meaning that the findings could result in a decision that the present capacity of the PFM system in a particular country does not allow for a meaningful implementation of HACT. The argument to amend the HACT framework so that the macro assessment results in a first-level determination of adopting HACT has been made in one recent joint audit report. The macro assessment in Malawi highlighted a number of high risks, including the absence of a comprehensive set of instructions relating to the internal control framework for budget users, the absence of functioning internal audit units, poor accounting and financial reporting standards, lack of capacity of the National Audit Office, and shortage of qualified staff.57

87. Following the audit report, the HACT framework does not clearly establish whether results of the macro assessment determine the applicability of HACT. In this regard, countries lack guidance supporting their decision making process in light of existing capacity gaps in the PFM system. While the macro assessment could result in applying ‘high risk’ in all of the listed categories of the associated checklist, the HACT framework does not foresee a scenario in which the implementation of HACT is not recommended. The audit report calls for a clarification of whether the macro assessment serves as a first-level determination of adopting HACT versus NIM. After this would have been decided, the payment modality should be selected.58

88. Principally, the HACT framework assumes the applicability of HACT in all programme countries. With its capacity development and financial management objective, the framework indicates how to address existing capacity gaps in the PFM system within the bandwidth of the HACT guidelines. This includes taking into account the capacity gaps in the CCA/UNDAF process and decisions on the cash transfer and assurance modalities. With this, the HACT framework stays highly theoretical as it does not offer concrete solutions for crisis and post-crisis environments, net contributing countries, and countries

55 See Annex II, Online Survey, Question 23: Comments on Section Macro Assessment. 56 See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.9. 57 Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.6. 58 Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.7.


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with major capacity gaps in the PFM system. The HACT framework has not established any criteria that would justify respective decision making in line with its guidelines. The need to formulate and include such concrete criteria in the HACT framework is supported by the significant number of countries that opted not to implement HACT.

89. With its capacity development objective as part of the macro assessment, the HACT framework assumes that UN agencies could play an active role in translating the findings of the macro assessment into the CCA/UNDAF process with the aim of integrating strategies that programmatically attend to these gaps. The HACT framework directly addresses this by stating that the key findings of the macro assessment should be summarized in the CCA and that the UNCT should collectively discuss the results of the CCA analysis to further agree on the interventions to address the identified gaps.59 As mentioned above and by summarizing some of the feedback to the recent global annual update and the online survey, this view is not shared by many practitioners. On the one hand, many focal points do not see sufficient funding or capacity on the UN side to engage in effectively addressing PFM gaps. One the other hand, the UN does not seem to have a comparative advantage that would make it advisable to programmatically engage in addressing PFM capacity development.60

4.3 Micro Assessment

4.3.1 Objectives of the Micro Assessment 90. According to the HACT framework, the findings of the micro assessment primarily guide the frequency

and coverage of assurance activities. The risk ratings ‘significant’ or ‘high risk’ are given if the system is more nascent and the control framework is inadequate to assure that cash transfers are used and reported as agreed with the agencies. While the risk rating as a result of a micro assessment does not determine whether HACT is implemented, financial risks can be minimized through finding the most suitable cash transfer modality and the extent and frequency of assurance activities. Micro assessments are conducted for implementing partners that receive cash transfers above an annual amount of US$100,000 combined from all UN agencies. For each implementing partner, the micro assessment is conducted at least once per programme cycle. While the HACT framework does not foresee any possibility to increase the threshold of US$100,000, it allows for conducting micro assessments for implementing partners with planned annual cash receipts below this amount.61

91. The micro assessment is designed to principally review the implementing partner’s system of

accounting, reporting, auditing and internal controls. The guidelines for assessing the financial management capacity of implementing partners in Annex III of the HACT framework stipulate that the

59 See ‘Framework for Cash Transfers to Implementing Partners’, p.8. 60 See Annex II, Online Survey, Question 23: Comments on Section Macro Assessment, ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 61 See ‘Framework for Cash Transfers to Implementing Partners’, p.4-6.


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micro assessment has two purposes: a capacity development objective and a financial management objective. Similar to the objectives of the macro assessment, the capacity development objective aims to identify areas in which deficiencies are noted and strengthening is required. The assessment should include recommendations to address the issues and help agencies plan capacity development activities. The financial management objective aims to identify the most suitable modalities, procedures and assurance activities by the agencies for the transfer of cash to implementing partners.62

92. Annex III of the HACT framework provides detailed guidelines for conducting micro assessments, which includes a standardized two-step approach for the assessment of implementing partners. Checklist A is for conducting a first-stage review of implementing partners that have more than two years of cooperation with at least one UN agency. Depending on experience in the areas of administration and financial management with the implementing partner, either the overall risk is considered low or a more detailed assessment will be required. Such a detailed assessment is conducted by applying checklist B, which covers the areas of funds flow, staffing, accounting policies and procedures, internal audit, external audit, reporting and monitoring, and information systems. The framework includes technical notes advising on the procurement of consulting firms or individual consultants and suggests a budget of US$5,000 per micro assessment.63

4.3.2 Challenges Related to Micro Assessments 93. Despite the detailed and standardized format of the guidelines in Annex III of the HACT framework,

many HACT implementing countries voiced significant challenges when conducting micro assessments. Focal points at the country level reported continuous problems with the management and follow-up on micro assessments. Some of the reasons relate to the fact that there is little institutional knowledge about carrying out the assessments and risk ratings of implementing partners. Particularly due to a high degree of staff turnover at relevant functions, many UN staff members are not familiar with the role and importance of the micro assessment in the overall risk-based financial management approach. In a number of countries, this has led to contracting audit/consulting firms that have not provided assessments in accordance with the quality standards as required by the HACT framework.

94. Following some of the comments in the recent global annual update, micro assessments include deficiencies and do often not adequately address the capacity issues of implementing partners. Therefore, the reports are marginally useful to feed into a capacity development plan for implementing partners.64 These findings are supported by the results of the online survey, in which respondents from

62 See ‘Framework for Cash Transfers to Implementing Partners’, Annex III, p.20-34. 63 See ‘Framework for Cash Transfers to Implementing Partners’, Annex III, p.20-34. 64 For example, A sample review of micro assessment reports as part of a recent impact assessment in Mozambique revealed that the quality of the reports falls short of the minimum requirements of the HACT framework and that in most cases, the reports do not provide the necessary information or documentation that would determine the actual risk rating as a result of the evaluation. None of the reviewed micro assessment reports followed the mandatory financial management questionnaires or included any


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more than 50 country offices confirmed that the financial management questionnaire is used only to a limited extent.65 This is supported by the findings of the recent joint audits of HACT, stating that it is evident that micro assessments were used to determine the appropriate cash transfer modality. However, agencies had not planned a cohesive and coordinated capacity building to help improve the implementing partners’ control environment.66

95. While many countries report facing challenges with the quality of micro assessment reports from service providers, the underlying causes are weak coordination and management of the micro assessments through the participating UN agencies. This includes the lack of a common HACT database in many countries, inadequate understanding among the UN agencies on the roles and responsibilities in the management of the micro assessments, and the absence of a systematic follow-up mechanism on the findings and recommendations. Further, it also relates to the procurement and effective quality control of the audit/consulting firm, based upon specifications that ensure a service provision in accordance with the quality standards as stipulated in the HACT framework. In this regards, a comment from one country highlighted that the procurement process for an audit/consulting firm to conduct micro assessments has not started, although the expiration of the previous Long Term Agreement (LTA) was anticipated for more than a year.67

96. This is supported by the results of the online survey, in which 64% of the respondents answered that the main challenges are connected to the inter-agency coordination when conducting micro assessments. This answer is closely followed by the quality of micro assessments (46.9%), the capacity of the audit/consulting firm (33.3%) and contracting the audit/consulting firm (26.4%).68 According to the online survey, micro assessments are conducted jointly in many countries, however only a few have established a common HACT database.69

97. While the responsibility for ensuring a proper quality control in line with the standards of the HACT

framework lies with the UN agencies, it is evident that it is very challenging for many countries to source qualified audit/consulting firms that are able to carry out such a complex exercise. As many countries have a large number of implementing partners located in different areas of the country, the contracted firm needs to have a relatively high minimum capacity to undertake this job. In many countries, the private sector still lacks a developed and competitive business environment that would ensure the selection of a firm that guarantees good value for the money. In turn, managing the process

organizational chart of the assessed implementing partners. As the findings were not shared with the implementing partners, there was no common understanding of the identified risks and capacity gaps. This significantly decreased the potential of the micro assessments as a tool for a systematic capacity development approach. See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’. 65 See Annex II, Online Survey, Question 27. 66 See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO); ‘Country Comments: 2011 Global Annual Update’ (UN DOCO); Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.9. 67 This example from Thailand involved a change of the procurement lead for the service provision under a commonly accepted LTA from UNDP to UNICEF. The previous agreement with PWC had expired in 2009. See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO). 68 See Annex II, Online Survey, Question 25. 69 See Annex II, Online Survey, Question 53.


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in cooperation with the audit/consulting firm generates very high transaction costs for the agencies as it needs to be closely supervised.70

98. Table 4.3.1: Number of Common Implementing Partners in Selected Programme Countries71

Programme Country Number of Implementing Partners Shared IPs

Region Name UNDP UNFPA UNICEF WFP Sum No. In %

East and South Africa

Angola 49 12 48 0 109 15 13.7 Botswana 15 6 18 0 39 9 23.1 Comoros Islands 18 1 26 0 45 7 15.6 Lesotho 17 4 29 4 54 25 46.3 Malawi 21 4 53 1 79 8 10.1 Mozambique 24 35 154 36 239 12 5.0 Rwanda 29 53 87 0 169 29 17.1 Tanzania 31 2 34 0 67 17 25.4 Zambia 11 10 152 0 173 8 4.6

West and Central Africa

Burkina Faso 39 10 260 5 214 25 11.7 Central African Republic 10 10 22 3 45 20 44.4 Sierra Leone 45 16 67 19 147 8 5.4 Senegal 10 6 12 0 28 28 100.0

Arab States Djibouti 1 2 4 0 7 2 28.6 Lebanon 3 9 18 0 30 2 6.7

Asia Pacific

Afghanistan 19 13 12 0 44 0 0 Bangladesh 19 26 87 44 176 22 12.5 China 7 11 40 0 58 3 5.2 Maldives 15 2 2 0 19 8 42.1 Pakistan 27 12 82 0 121 4 3.3 Sri Lanka 9 2 36 0 47 6 12.8

Europe and CIS

Armenia 4 2 25 0 31 0 0 Moldova 10 0 3 0 13 1 7.8 Kazakhstan 13 0 18 0 31 1 3.2 Tajikistan 11 4 40 0 55 5 9.1

Latin America and the Caribbean

Chile 18 4 6 0 28 5 17.9 Colombia 21 10 43 0 74 3 4.1 Dominican Republic 10 2 2 0 14 1 7.1 Guyana 8 0 45 0 53 4 7.5 Mexico 16 2 7 0 23 1 4.3 Peru 32 6 2 0 40 5 12.5 Uruguay 9 2 0 0 11 10 90.9

*Source: 2010 Global Annual Update (UN DOCO).

99. The HACT framework estimates a budget of US$5,000 per conducted micro assessment. While there is little information available about the actual costs, many countries commented on the significant investment necessary to conduct micro assessments for all implementing partners. While in some countries, the number of implementing partners remains small, for a lot of HACT implementing

70 This finding is supported by the results of the online questionnaire, in which more than 47% of the respondents found the quality of the assessment reports to be a major challenge, followed by the quality of the audit/consulting firm and the procurement process. See Annex II, Online Survey, Question 25. 71 The countries have been selected in accordance with the availability of reported data. Many countries did not report the number of implementing partners/shared implementing partners in the 2010 update. In the recent 2011 update, UN DOCO did not request countries to report the number of implementing partners.


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countries the number of partners exceeds 100 and in some cases 200. As shown in table 4.3.1, an increasing number of implementing partners is generally not matched by a similar increase of shared implementing partners. That implies that the expectation that a large number of implementing partners would lead to a high degree of inter-agency coordination and greater efficiencies has not been fulfilled. Mozambique reported having 249 implementing partners and Burkina Faso reported having 314.

100. While the estimated amount of US$5,000 seems to exceed the actual spending of many agencies per micro assessment, the cost can significantly vary depending on the size of the implementing partner and travel costs to different regions of the country. A cost estimate in Mozambique for the period between 2007 and 2009 calculated the overall costs for micro assessments to be in excess of US$300,000. In the comments to the recent global annual update, Tanzania confirmed the approximate costs per micro assessment of US$5,000.72 Many practitioners have commented on the significant funding requirements for micro assessments, challenging their overall feasibility in connection with the related shortcomings.73 Like most activities connected to the implementation of HACT, micro assessments are conducted on an ongoing basis and, therefore, constitute recurring costs that will not diminish over time.

101. In addition to the cost factor, countries reported that conducting micro assessments requires a significant amount of time. The reasons for this lie in the challenges of involving dedicated officials from the implementing partner side to effectively cooperate with the audit/consulting firm and the large amount of implementing partners. While the HACT framework stipulates that assessments should take place before agencies transfer significant resources to the implementing partner, in reality this is often not the case as the large number of implementing partners mostly requires micro assessments far into the running programme cycle.74

102. Following the HACT framework, one of the main purposes of the micro assessment is to identify

areas where deficiencies exist and further capacity development is required. Therefore, micro assessment reports should include recommendations on how to address these shortcomings. As commented by some countries, the framework itself does not provide any guidance on how to develop the capacity of implementing partners in specific areas related to their financial management. The micro assessment is typically de-linked from assurance and capacity activities as it is mainly determining the risk rating of the implementing partner. While the findings of the micro assessment are ideally addressed in the annual work plan (AWP) of the implementing partner to overcome gaps and weaknesses as identified in the assessment report, they are not always addressed, first, because AWPs

72 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 73 For example, a comment from Lesotho confirmed that the high costs of assessments kept the system from advancing on HACT as it was felt that the costs would be too high. This was followed by the recommendation to classify all implementing partners as ‘high risk,’ allowing for a full implementation of HACT. See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO). 74 See ‘Responses from Country Offices on reasons/bottlenecks for the implementation of HACT.’ (UN DOCO); ‘Country Comments: 2011 Global Annual Update’ (UN DOCO); ‘Framework for Cash Transfers to Implementing Partners’, Annex VII, Technical Note 5, p.64.


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are often finalized before micro assessments are conducted and, second, the majority of micro assessments do not translate results into recommendations for capacity building. This observation is supported by respondents from more than 70 countries in the online survey, who confirmed that risk ratings do not result in adequate capacity building activities.75

103. On the government side, micro assessments are often not seen as a measure that helps to increase national ownership or the implementing partner’s capacity. In addition to the above findings on government cooperation, micro assessments are potentially seen as the introduction of an additional fund transfer and reporting modality. This is particularly the case for small countries with few resident agencies, where micro assessments have to be conducted for some government entities and not for others that do not receive funds from HACT implementing agencies. An example from Albania suggests that there is no simplification of work for either UN agencies or implementing partners. UNICEF, UNDP and UNFPA conducted micro assessments separately with their implementing partners, leading merely to a different way of financial management for implementing partners rather than a harmonization and simplification of procedures.76 In addition, one country office pointed out that micro assessments should not be done in cases where projects are financed by government third-party cost sharing to which an agency has been requested to give direct support services for project implementation.77

4.3.3 Definition of Implementing Partner 104. The HACT framework does not provide a clear definition of the implementing partner leaving much

room for interpretation at the agency level. The different understanding of the term “implementing partner” has led to significant differences between and within programme countries in the HACT implementation process. For most countries, the common understanding is that the implementing partner is defined for the micro-assessments at the departmental level of national and provincial governmental institutions in accordance with the accountability for project implementation arrangements, cash transfers and the signature of the FACE form. However, some countries define the implementing partner at the directorate level, often including several departments, or at the national ministry level. Similar differences are observed when NGOs become implementing partners. Here, the implementing partner is defined either at headquarter level or at the level of country offices or provinces. Apart from technical issues, a different definition of the implementing partner level as considerable consequences for both the amount of micro assessments conducted and, related to that, the extent of the financial risk in relation to the amounts transferred.

105. Defining the implementing partner at the national ministry level dramatically reduces the amount of micro assessments to be conducted. Positive effects include a profound reduction of transaction

75 See Annex II, Online Survey, Question 30. 76 See Annex II, Online Survey, Question 32: Comments on Section Micro Assessment. 77 This comment from Honduras reflects the situation in many middle income countries, where government third-party cost sharing to UNDP projects is common. See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO).


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costs and the possibility to incorporate the ministries’ control and accountability systems over its departments. While this implies that the micro assessment needs to cover accounting arrangements in a large number of sub-departments, the financial management questionnaire would apply to the level of the ministry and result in one risk rating at the ministry level. At the same time, funds are directly transferred to the departmental or project management units, which report on the utilization of funds through the FACE form. The definition of implementing partner has been observed with great concern during recent joint audits as the risk rating is not connected to the direct recipient of funds, but to a higher level with a potentially different accounting system and internal control framework. In addition, this implies that there is little recognition of varying capacity gaps leading to different financial risks at the level of departments or project management units.78

106. While the HACT framework lacks a clear definition of the implementing partner, it is imperative that the implementing partner be defined in a harmonized approach throughout the HACT implementation process. As mentioned in a recent assessment for Mozambique, inconsistencies in this regard could lead to serious risks for the national accountability framework for UN interventions and could weaken the potential for effective capacity enhancement of national structures and systems.79 Since the main objectives of the micro assessment support the implementation of the appropriate cash transfer modality and have been defined in the identification of capacity development needs and targeted assurance activities, it seems appropriate that the implementing partner level should correspond to the level at which financial transactions are made and the FACE form is utilized to request payments and report on expenditures.80

4.3.4 Definition of Financial Thresholds 107. The HACT framework determines the financial threshold for conducting micro assessments to be at

an annual amount of US$100,000 combined from all agencies. While it stipulates that assessments may be conducted for annual cash receipts below this amount, it does not suggest any increase of the threshold.81 As with the definition of the implementing partner, changes in the applicable threshold for micro assessments potentially lead to significant alterations in the number of the micro assessments per programme cycle. While most programme countries adhere to the threshold as introduced by the

78 An example of the definition at ministry level is Vietnam, where an agreement with the government has set the implementing partner at the ministry level. As in many countries, formal agreements and signatures of AWPs are done at the senior ministry level and practical implementation and transfers of funds are made to departmental or project management unit level. See ‘Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Vietnam’, p.12. 79 See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’, p.14. 80 This finding is supported by a recent definition of implementing partner in a note on ‘Vietnam - Harmonized Programme and Project Management Guidelines (HPPMG)’ “Implementing Partner (IP) is the legally established entity that is selected by the Government and the UN and documented in the detailed project outline to directly manage and implement a programme or project supported by a UN Agency. The IP assumes full responsibility and accountability to the relevant authority of the Vietnamese Government and the UN Agency, for the production of the outputs expected from the Agency-supported programme/project and for the effective use of the resources provided to it by the Agency.” 81 See ‘Framework for Cash Transfers to Implementing Partners’, p.4.


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HACT framework, the result of the online survey has shown that many practitioners at the country level recommend establishing different thresholds. While 46% of the respondents confirm that the minimum financial threshold to conduct micro assessments should continue to be US$100,000, 54% suggest different amounts ranging US$50,000 to over US$500,000. A full 35.4% of the respondents would like to see financial thresholds for micro assessments to be at US$200.000 or more.82

108. From the information provided, it is difficult to determine whether an increase in the financial

threshold would be feasible as it implies that a significant number of implementing partners would no longer be assessed. This would not only increase the financial risks for the UN at the country level, but it also would mean that implementing partners would not take advantage of the potential capacity building objective of the micro assessment. This, of course, would only be applicable if micro assessments are carried out with due diligence as suggested by the HACT framework and the identification of capacity gaps lead to the actual implementation of targeted and results-oriented capacity development measures.

109. As per the findings of this assessment, there is only one country – Vietnam – that has substantially increased the financial threshold for micro assessments to an amount of US$500,000 in combination with increasing the amount for HACT audits per programme cycle to US$1 million. For UNFPA alone, this led to a reduction in micro assessments of about 50% and a reduction in HACT audits of about 40%. This interpretation of the HACT framework based on different locally agreed thresholds has been noticed with great concern during a recent joint audit, arguing that the absence of micro assessments would deprive the IP of the benefits of participating in the assessments of its financial control framework and potential improvements in its capacity as a result.83

110. According to the country-led evaluation report of Vietnam, the government demonstrated in-depth

knowledge and understanding of the HACT process and requested the UN to follow its requirements with regard to financial procedures and policies. This resulted in increased thresholds for micro assessments and a focus on principle ministries as implementing partners. It is noteworthy that, in the case of Vietnam, a considerable attention of the government to the HACT process resulted in the relaxation of the financial thresholds. While one of the HACT objectives is the increasing use of national systems, the framework does not foresee changes in financial thresholds that would lead to a significant reduction of assurance activities.84

82 See Annex II, Online Survey, Question 26. 83 See ‘Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Vietnam’, p.6-8. 84 See ‘Country-led Evaluation, Delivering as One; UN Pilot Initiative in Vietnam’ (2010), p.55


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5 HACT Implementation

5.1 Cash Transfer Procedures 111. The HACT framework stipulates that cash transfers under any of the four modalities – direct cash

transfer, direct payment, reimbursement and direct agency implementation – are subject to the procedures as described in the framework. The activities to be carried out by the implementing partner and as formulated in the Annual Work Plan (AWP) are the basis for any cash transfers. While direct cash transfers have to be requested and released for programme implementation periods not exceeding three months, all other modalities are subject to the completion of activities. Implementing partners use the Funding Authorization and Certificate of Expenditures (FACE) form to request cash transfer, authorization to incur future expenditures, report on the utilization of cash received or request reimbursement for expenditures already incurred. The main objective of the FACE form is to establish a simplified and harmonized tool that is intended to replace agency-specific formats and all other documentation used by partners.85

5.1.1 Funding Authorization and Certificate of Expenditures 112. According to the HACT framework, funding requests are based on the CPAP and line items of the

AWP’s itemized cost estimates. Implementing partners are required to report on the activities by certifying actual expenditures for the period without attaching supporting documentation. Invoices and other supporting documents are retained by the implementing partner. The FACE form is used in close alignment with the AWP as all activities for which funds authorizations are requested must be specified in the AWP. Requests for funding are accompanied by itemized cost estimates of activities to be funded. Consequently, the HACT framework does not foresee expenditures outside AWP line items.86

113. The feedback from country offices in the recent global annual update and the online survey confirms that the FACE form as an integrated standard format for all funding requests and expenditure reports supports the simplification of business processes for implementing partners. However, in a number of programme countries, agencies have adjusted the FACE form in accordance with agency-specific requirements. In Mozambique, a comparative analysis of the observed differences has shown that individual agencies have considerably adjusted the form and implemented additional conditionalities to the procedures as requested by the HACT framework. For example, UNFPA required a detailed three-months work plan in addition to the AWP for each payment request. For the direct cash transfer modality, UNDP and UNFPA requested copies of bank statements and bank reconciliations as annexes to the FACE form, in addition to the financial and activity reports.

85 See ‘Framework for Cash Transfers to Implementing Partners’, p.6-7, 10. 86 See ‘Framework for Cash Transfers to Implementing Partners’, p.10-13.


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114. For the direct payment modality, UNDP and UNFPA requested original invoices and a minimum of three quotations as additional attachments to the FACE form, while UNICEF only requested copies of the invoices.87 The comparative analysis in Mozambique has shown that it will be very important to standardize the FACE form in greater detail to ensure a harmonized management of the cash transfer procedures. This is supported by a number of comments from different countries, which stated that cash transfer procedures will only be effective if the FACE form is completely harmonized across all agencies. Please refer to Annex V for the complete table of observed differences in the application of the FACE form in Mozambique.

115. In line with the findings from Mozambique, a number of HACT focal points from various countries reported that their agencies request implementing partners to attach supporting documentation to verify expenditures. This tendency is supported by a number of comments as part of the online survey, which express concern that the FACE form does not show how funds have been spent.88 According to the HACT framework, the verification of expenditures should be covered through reporting the expenditures based on the activity-based line items in the attached AWP. For many countries, however, this constitutes a challenge as funds requested and expenditures are often not completely aligned to the AWP. In addition, some practitioners confirmed that there are numerous cases with outstanding balances from previous reporting periods, which has led to introducing additional control instruments into the FACE form.89

116. In the online survey, several countries commented that assurance activities have shown that funds are frequently spent on items that have not been part of the budget as per the AWP. This constitutes difficulties as the FACE form would regularly need to be adjusted and expenditures reconciled after the certified reporting by the implementing partner. Reconciliation is often difficult as there is a considerable time delay between the expenditure, the reporting through the FACE form and the assurance activities. Related to these differences, practitioners have commented that they face an increasing number of spot checks in which all financial records need to be reviewed. In addition, the introduced practice of reporting with the FACE form has led to growing risks of corruptive behavior.90

117. Some agencies at the country level have introduced account codes into the FACE form as suggested in the HACT framework. The FACE form includes a coding column where agencies can enter their own account codes or request the implementing partner to do so. In accordance with the framework, this requires additional training of the counterpart.91 While it seems inevitable to apply several chart of accounts due to the agencies’ different financial management systems, delegating the task of managing different UN-specific chart of accounts has been commented to be in contradiction with the HACT objectives to simplify and reduce transaction costs. The requirement for additional training to learn UN

87 See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.16. 88 Online Survey, Question 35: Comments on Section FACE Form. 89 See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.17; Online Survey, Question 35: Comments on Section FACE Form; ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 90 Online Survey, Question 35: Comments on Section FACE Form. 91 See ‘Framework for Cash Transfers to Implementing Partners’, p.12.


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account coding of activities constitutes a shift of transaction costs from the UN to the implementing partner and is inconsistent with the aim to gradually apply national systems.92

118. In accordance with the feedback from several of country offices, the FACE form is inappropriate for effectively managing direct payments to vendors. This cash transfer modality is often used in countries with third-party cost sharing for programmes and projects. The form does not allow for correctly account for direct payments from UN agencies to vendors along with activities as described in the AWP. In this connection, several country offices confirmed that project activities of implementing partners are monitored by Programme Officers who frequently check all documentation before direct payments are authorized. Therefore, the implementation of HACT has not simplified any of the business practices in regards to the direct payment modality.93

119. The subject of direct payments has been addressed by the UNDG. A direct payment is defined as a transfer of cash to a vendor or third parties for obligations incurred by the implementing partners on the basis of requests signed by the designated official of the implementing partner. Therefore, the minimum requirement for an agency to proceed with the payment would be an authorized request, a function that the FACE form would have if duly certified by the signatory of the implementing partner. Similar to the modality of direct cash transfers, supporting documentation is not required. However, an annex could be used to describe the payments, vendor and bank details. As the implementation of HACT would offer other assurance activities, the implementation of HACT does not oblige agencies to continue close monitoring of direct payment activities.94

120. Table 5.1.1: Periodicity of Disbursement and Reporting

*Source: Framework for Cash Transfers to Implementing Partners

121. While many countries reported difficulties with the management of the FACE form, the online survey confirmed that the majority of practitioners believe to a large extent that the FACE form is an effective tool to manage disbursements and reporting of implementing partners. On a scale from one

92 See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.15. 93 In accordance with HACT focal points and Programme Officers in Morocco, guidelines on the national implementation continue to request ongoing checks and separate approval of expenditures by the Programme Officers. NIM guidelines would be more useful as they correspond to the actual implementation of programmes rather than translating overall assessments of the institution to project activities. (Teleconference from 27 Nov 2011). 94 See ‘Frequently Asked Questions – Harmonized Approach to Cash Transfer’ (UNDG 2009), p.25.

Payment Modality Periodicy of Disbursement Reporting

Direct Cash Transfer Quarterly FACE

Direct Payment to Vendors Activity Based FACE

Reimbursement of Expenses Activity Based FACE

Direct Agency Implementation N/A By Agency


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to five, more than 55% of the 297 respondents checked either four (31%) or five (24%).95 As above mentioned, a number of agencies at the country level have added attachments to the FACE form in the form of supporting documentation, which is not required by the HACT framework. This is supported by the results of the online survey in which only 34.7% of 297 respondents confirmed that the FACE form fully replaces all other documentation to request funds and report expenditures.96

122. The adaptation of the FACE form through practitioners at the country level has led to many differences in the required information and the number and variety of mandatory annexes. The result has been the implementation of a number of additional business processes around the cash transfer procedures as described in the HACT framework. In accordance with the feedback received, practitioners found the guidelines for the cash transfer procedures and usage of the FACE form too imprecise. The guidelines do not contain detailed explanations on necessary attachments to the FACE form, which has resulted in different agency-specific interpretations of mandatory procedures at the country level. The introduction of additional supporting documentation as part of the expenditure reporting, such as bank reconciliation statements and stamped invoices, indicates that many country offices continuously seek to implement financial control mechanisms.

5.1.2 Periodicity of Disbursement and Reporting 123. The HACT framework predicts a period of three months for disbursement and reporting for the

direct cash transfer modality. This has been established following an estimate of agencies’ global experience with cash transfer procedures. Three months would present a good compromise that allows the tracking of activities, expenditure and results, without overburdening partners with too many reporting obligations.97 Recent feedback from country offices in the online survey and interviews has shown that for a number of countries, quarterly disbursements and reporting through the FACE form constitute challenges for a variety of reasons.98

124. Some of the countries stated that it takes time to release funds for the next activity/quarter and that these delays lead to implementing partners being unable to spend most of the received funds within the three-months reporting period. For example, a six-week delay in cash disbursement makes it impossible for the implementing partner to complete a procurement process from initiation to certified payment for the good or service. An initiation of procurement processes in expectation of funds would violate most procurement regulations, which require a positive balance to approve the purchase requisition. To circumvent the issues arising with frequent delays in fund releases, one agency at the country level introduced parallel processes for payment requests and expenditure reporting by using two FACE forms for the same implementing partner. This serves to mitigate risks of delays in project

95 See Annex II, Online Survey, Question 34. 96 See Annex II, Online Survey, Question 33. 97 See ‘Frequently Asked Questions – Harmonized Approach to Cash Transfer’ (UNDG 2009), p.24. 98 Online Survey, Question 35: Comments on Section FACE Form; ‘Country Comments: 2011 Global Annual Update’ (UN DOCO).


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implementation. This is clearly not in accordance with the HACT framework, which stipulates the use of one FACE form for each implementing partner and payment modality.99

125. Apart from delays in the disbursement of funds as a result of internal UN procedural hindrances, some countries stated that there are often significant delays in disbursement in cases where implementing partners cannot receive direct transfers to their bank accounts. For example, in Ethiopia funds are channeled from the center to implementing partner sites in the regional states. Disbursements are not directly made to the implementing partner level but channeled through the Regional Bureaus of Economic Development and used at the local government level. Therefore, the established PFM system incurs long processing times for disbursements to the implementing partner level. In addition, the locations of most project sites are in remote parts of the country with limited communication and a rudimentary banking infrastructure. According to the UNCT Ethiopia, it takes close to three months for advanced funds to be received.100

126. In recognition of the extended processing time for cash disbursements, the Ministry of Finance and Economic Development (MOFED) in Ethiopia has officially requested that the UN change the frequency of disbursement from three to six months and the period to account for the incurred expenses from six to nine months. In addition, the MOFED requested a fixed amount of direct cash transfers to be rolled over into the next period, allowing for activities to continue and avoiding bureaucracy whereby small amounts of funding would need to be returned before the next cash transfer is approved.101

127. The UNCT Ethiopia supports the government request and turned to the HACT Advisory Committee to facilitate a solution to these challenges. In addition to the possible introduction of extended disbursement and reporting periods, the proposal to allow for a fixed percentage of the balance to be rolled over to the next period would introduce some degree of flexibility into the cash transfer procedures. Retaining a balance of 20% would enable implementing partners to continue with the implementation of activities during the process of accounting and cash disbursement for the next period. According to the UN Ethiopia, cash advances are frequently used for salaries and other recurring expenditures as well as for implementing activities. The balance of funds to be rolled over becomes part of the next cash advance, and therefore is deducted from future disbursements. This allows an uninterrupted continuation of the activities and prevents transaction costs when reimbursing funds after the end of each period.102

99 See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.15. 100 This is supported by an example from UNICEF explaining that funds are disbursed along a decentralized chain that typically involves a Sector Bureau or a local district. It would often take nine weeks for cash to reach an implementing partner’s account at the local district level. With the liquidation process requiring a further four weeks, this would leave a maximum of three months for programme implementation before the six months direct cash transfer limit is reached. See ‘Proposal to reform Direct Cash Transfer Management, UNICEF Ethiopia’ (April 2011); ‘Concept Note on Six Months Direct Cash Transfer Modality’ (31 May 2011). 101 MOFAD suggested expressing the balance in percentage term accompanied by a cap at a specific absolute value. See Letter to the UN Resident Representative: ‘The Federal Republic of Ethiopia - Ministry of Finance and Economic Development: Extending each fund period to six months and DCT to nine months. (03 September 2010). 102 See ‘Proposal to reform Direct Cash Transfer Management, UNICEF Ethiopia’ (April 2011).


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128. The proposal to extend the disbursement and expenditure reporting periods would allow for a closer adaptation to national PFM systems and recognition of very long time periods from the initiation of a disbursement and the receipt at the implementing partner level. As this analysis has shown, there are a number of countries channeling all aid related disbursements through one treasury account, which leads to partly significant delays in processing financial transactions. While the extension of the frequency results in greater flexibility, it raises concerns about the increased financial risk incurred. First, disbursed advances for six-month periods would be much higher and lead to a loss of interest income. Second, expenses would not be accounted for up to nine months for a running period. This, in turn, would violate CPAP clauses on cash transfer modalities and procedures stating that reports on the full utilization of funds have to be submitted within six months of receipt.103

129. A recent concept note on the issue recommends piloting the extension of the cash disbursement period to six months for selected ‘low risk’ implementing partners to assess the risks and benefits of the approach. It stressed that selected partners should have been rated ‘low risk’ in recent UNDP and UNFPA audits. In addition, a threshold should be established for a maximum direct cash transfer to implementing partners, enabling different thresholds for different implementing partners. Reporting on expenditures should remain on a quarterly basis, whereas disbursements for the next period are subject to a reported liquidation of at least 50% of the outstanding advances.104

130. The call for extended disbursement and reporting periods has been supported by feedback from several countries as time delays on the side of the UN and long processing times at the government level can seriously impact the actual period to implement activities. By introducing a quarterly disbursement and reporting period the HACT framework does not anticipate any process delays and assumes timely cash transfers to the implementing partner’s bank account. Quarterly expenditure reporting before the initiation of the next disbursement interrupts the cash flow for implementing programme activities, which can be successfully overcome by carrying over any balances to the next disbursement period. Extending the periodicity of disbursements potentially reduces transaction costs; however the extent of financial risk is highly dependent on high quality capacity assessments and well established assurance activities.

5.1.3 Implementation of International Public Sector Accounting Standards 131. The scheduled move from the currently used United Nations System Accounting standards to IPSAS

has raised questions in regards to its impact on HACT. IPSAS will be implemented as of January 1, 2012, generating a series of changes toward full accrual accounting. This implies that performance and positions will be measured by recognizing the economic event, regardless of when cash transfers occur. This implies that economic events are recognized by matching revenues to expenses at the time in which the transaction occurs rather than when the payment is made or received. Compared to cash

103 ‘Concept Note on Six Months Direct Cash Transfer Modality’ (31 May 2011). 104 ‘Concept Note on Six Months Direct Cash Transfer Modality’ (31 May 2011).


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accounting, accrual accounting allows receiving a more accurate picture of the financial situation of an organization by combining current cash inflows and outflows with future expected cash inflows and outflows.105

132. For UN agencies, adopting IPSAS means that goods and services are not recorded when a purchase

order is issued, but at the time when goods and services have been received. In addition, the method requires full recording of benefits and liabilities, such as staff benefits and outstanding payments. Different from before, IPSAS introduces a system of linear depreciation of assets over time, leading to a more accurate picture of the actual value of all assets combined at a particular point in time. According to the information provided, the impact of IPSAS on HACT is limited and varies between the agencies. The reason is that UNDP, UNFPA and UNICEF account for their expenditures differently.

133. While for UNDP and UNFPA the cash disbursement to an implementing partner is recorded as

advance, for UNICEF the cash disbursement is recorded as expenditure and treated like a grant. Therefore, UNICEF does currently not require reporting on the expenditures made by implementing partners and the exact utilization of funds beyond the transfer of cash. Under IPSAS, UNICEF will move to a system where the utilization of cash will have to be recorded. This means that cash transfers will become advances and will be no longer be recorded as expenditures on the balance sheet. As confirmed in the headquarter interviews, assurance activities will become crucial for UNICEF as there must be a provision on how funds are being used. As under HACT the utilization of funds is only documented in the FACE and based on the AWP, more guidance on ‘high risk’ partners will be necessary.

134. For UNDP and UNFPA, the requirement to account for the utilization of funds is already in place.

Cash disbursements to implementing partners are recorded as advances which require a frequent reporting on the actual liquidation of funds. Governments will have to provide information, which will be recorded as obligations in the notes of agencies’ financial statements. Combined delivery reports will change in terms of adding the commitments of future years. This explains why it is challenging for these agencies to forego the collection of additional supporting documents and consequently moving away from the NIM audit regime. As pointed out in some of the interviews, the requirement of IPSAS to produce annual financial statements and also being audited on an annual basis is perceived as the greatest challenge for the involved agencies. Overall, the introduction of IPSAS is likely to increase the pressure on carrying out appropriate assurance activities under HACT.

105 For more information on general principles of accrual accounting, please go to www.investopia.com. For detailed information on IPSAS standards, please visit the IPSAS website at: http://www.ipsas.org/en/ipsas_standards.htm.

http://www.investopia.com/

http://www.ipsas.org/en/ipsas_standards.htm


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5.2 Assurance Activities 135. The analysis of the global annual updates has shown that HACT implementing countries have

particular challenges in establishing assurance and audit plans. While 57 countries reported having completed macro and micro assessments, 38 countries confirmed that they have completed an assurance and audit plan (66.7%). While the absence of an implemented assurance and audit plan does not directly imply that there are no assurance activities performed, it raises questions about the extent to which assurance activities have been established, are systematically carried out and are coordinated between agencies at the country level.

136. Figure 5.2.1: Number of Joint Assurance and Audit Plans by Region


5.2.1 Objectives of HACT Assurance Activities 137. As per the HACT framework, the initial scale of assurance activities through agencies is guided by

the risk rating and the magnitude of combined cash transfers received from agencies. The assurance activities may lead to changes in the procedures and modalities for disbursing cash transfers. The framework delegates the responsibility of determining the combination, frequency and scale of assurance activities to the representative of each agency that provides cash transfers to implementing partners. Assurance activities include periodic on-site reviews, programmatic monitoring and scheduled audits.106

138. The objective of assurance activities is to verify whether the disbursed funds were used for the intended purpose as described in the AWP and in accordance with the required procedures. The HACT framework stresses the need for coordination between agencies sharing one or more implementing partners to harmonize assurance activities, coordinate activities as implemented by individual agencies

106 See ‘Framework for Cash Transfers to Implementing Partners’, p.7-8.

22 2418

36

24 2619

1610

28

14 169 9

3

17

3 6

05

10152025303540


No. of Countries HACT Implementing Countries Joint Assurance and Audit Plans


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and share results with all concerned agencies. While the framework refers to agency-specific guidelines for on-site reviews and programmatic monitoring activities, it provides guidance for the management of HACT audits. Periodic on-site reviews can be performed in the form of spot checks by agency staff and external consultants or in the form of special audits by commercial audit firms, which would provide additional technical expertise. Special audits aim to address specific weaknesses and can be implemented on short notice. Programmatic assurance is maintained through the practices as established by each agency and includes receipt of implementation reports, site visits by agency staff, annual reviews, and evaluations.107

139. Scheduled audits of internal controls for cash transfers are performed at least once for implementing partners receiving more than US$500,000 in cash transfers combined from UN agencies during the period covered by the CPAPs. The scheduled HACT audits aim to assess the internal control systems of the implementing partners and their capacity to receive, record and correctly disburse the cash transfers provided by UN agencies. The HACT framework emphasizes the importance of establishing an annual audit plan to identify implementing partners who will receive scheduled audits during the calendar year and set up a schedule of audits. In addition, the audit plan determines necessary inter-agency coordination for common implementing partners to undertake joint audits and ensure that all assurance activities are recognized.108

5.2.2 HACT Assurance versus Project Level Auditing 140. According to a number of comments in the recent global annual update, many countries that have

implemented assurance and audit plans have not been able to systematically follow up with the actual assurance activities. This is supported by the findings of the recent assessment in Mozambique. While agencies have carried out a significant number of on-site reviews, they have not been conducted systematically and in line with the provisions of the joint assurance and audit plan. In particular the quality of the on-site reviews have been a major issue as staff members frequently have not fully understood the purpose or content of the exercise. In the recent global annual update, a number of countries highlighted the lack of capacity of UN staff to successfully commence assurance activities. In addition, on-site reviews have been used to re-evaluate the risk rating of implementing partners, changing the results of the micro assessments.109 These findings are supported by the online survey in which 31% of respondents confirmed that on-site reviews have resulted in changing the risk rating of an

107 Special and scheduled audits can be undertaken by the SAI if the macro assessment established that the SAI has adequate capacity to undertake audits of government partners and fulfill the minimum requirements as per international audit standards. If the SAI does not have adequate capacity or does not undertake audits to the required frequency by the agencies, agencies commission the audits in line with the terms established in the CPAP. See ‘Framework for Cash Transfers to Implementing Partners’, p.35-38. 108 See ‘Framework for Cash Transfers to Implementing Partners’, p.35-38. 109 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO); ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.19.


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implementing partner. While 31.5% answered that they do not know, 37.4% answered that on-site reviews have not changed any risk ratings.110

141. The findings from the recent joint audit of HACT in Malawi show that assurance activities under

HACT have not been performed by all participating agencies. According to the audit report, UNICEF performed periodic spot checks while UNDP and UNFPA continued to perform project-focused NIM audits in lieu of carrying out HACT assurance activities. The auditors observed that the continuation of NIM audits might be justified for projects executed by ‘high risk’-rated implementing partners, however maintaining the NIM audit regime for all projects, regardless of the level of risk, does not seem to be in line with the HACT concept and the shift from control-based to risk-based financial management. Also, the continuation of project-level audits would question the systematic approach of the macro and micro assessments, which aim to establish the basis for all assurance activities.111

142. The interviews with country offices and the feedback to the global annual update confirmed that

project-oriented NIM audits continue to be conducted in many countries.112 Similar to requesting additional supporting documentation to the FACE form, the continuation of NIM audits is perceived to provide a higher level of assurance than the HACT assurance activities stipulated in the HACT framework. This includes country offices that are considered HACT compliant but continue to apply the NIM audit regime, rather than moving to the HACT audit regime. This has resulted in a strong inconsistency with the objectives of the HACT framework and between HACT implementing agencies at the country level as it does not allow for a consequent harmonization of cash transfer practices and assurance activities. The results of the online survey verify these findings as many countries confirmed the continuation of NIM audits, in part because of the absence of a coordinated HACT approach.113

143. In addition, the feedback from country offices has shown that there is a strong perception that

HACT assurance activities, including HACT audits, do not enable a full evaluation of national counterparts regarding the implementation of projects. Following this, it was also noted that donor representatives at the country level seem to have a clear preference for project-based audits, favoring the NIM audit regime over the HACT audit regime. This is particularly the case for countries with a majority of ‘high risk’ implementing partners. Despite recognizing the interdependencies of capacity assessments and assurance activities as per the HACT framework, the expected results of HACT audits are considered to be not detailed enough. As long as the option exists, most UNFPA and UNDP country offices seem to continue with NIM audit procedures as the most important assurance activity in the programme implementation. This, in turn, has led to almost no systematic implementation of assurance activities by UNFPA and UNDP as foreseen by the HACT framework.114

110 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO); Annex II, Online Survey, Question 37. 111 See Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.11. 112 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO); Annex II, Online Survey, Question 42: Comments on Section Assurance. 113 See Annex II, Online Survey, Question 39, including comments. 114 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO).


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144. Apart from a focus on project implementation, one of the reasons for the continuation of the NIM audit regime lies in weaknesses of the HACT framework itself. Describing the assurance mechanisms for cash transfers, the framework remains unclear about how to avoid possible inconsistencies between agency-specific progamme implementation guidelines and the HACT framework. For example, the framework stipulates that programmatic assurance is maintained following the standards and guidance established by each agency.115 As confirmed by UN Programme Officers during the interviews with country offices, it seems to be very challenging to monitor the implementation of projects and, at the same time, apply assurance activities inspecting the overall institutional capacity of implementing partners. This is particularly the case where the continuous application of agency-specific programme implementation guidelines promotes a control-based financial management culture. As a result, the majority of agencies at the country level circumvent a consistent implementation of risk based financial management by ensuring a parallel continuation of control based measures.116

5.2.3 Challenges Related to HACT Audits 145. Based on the feedback from agencies at the country level, internal audit departments at agency

headquarters seem to frequently challenge the implementation of a risk-based financial management approach in accordance with the HACT framework. Moving from project-based audits to partner-based HACT audits has been seen as problematic as the HACT framework would be inconsistent in its guidance on HACT audits. For example, the “Terms of Reference for Financial Audit of Implementing Partners” in the HACT framework would be incoherent as it would not focus on conducting financial audits, but only on auditing internal controls of implementing partners.117 Additional financial risks would be introduced as HACT establishes risk management concepts and leaves it up to the individual country offices to determine the assurance needs of their implementing partners. Following this, a number of practitioners believe that a full HACT implementation is not fully supported by their headquarters as they are requested to continue with project-based audits. As this might not be the case, it would be necessary to clarify the circumstances under which project-based audits would be requested.118

146. According to information received in some of the interviews, challenges of moving from project-

based audits to on-site reviews and HACT audits are connected to requirements of internal audit and other headquarter departments. However, in review of this finding, UNDP’s Office of Audit and

115 See ‘Framework for Cash Transfers to Implementing Partners’, p.36. 116 This has been confirmed by all available sources, including the teleconferences with selected country offices. A good example for this practice is one country office where Finance staff has established the management of the FACE form without requesting supporting documents. However, Programme Officers who are monitoring the activities of the implementing partners continue to receive all certified invoices in verification of project expenditures. Overall, the office believes it has complied with HACT requirements as it has conducted the relevant capacity assessments and established the FACE form. At the same time, it monitors the programmatic progress by frequently verifying the expenditures. 117 See ‘Framework for Cash Transfers to Implementing Partners’, Technical Note 4, p.60. 118 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). This particular argument has been made in recognition of a respective note from UNDP’s Office of Audit and Investigation (OAI).


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Investigation (OAI) noted that this statement would be inaccurate and that there would be no requirements imposed by OAI to move from project-based audits to on-site reviews. Nonetheless, there are no UNDG approved guidelines that would clarify how assurance activities should be carried out in line with minimum corporate audit requirements. While HACT assurance activities might not qualify for replacing project-based audits, agencies at headquarter level have not yet introduced a solution that effectively addresses these discrepancies. According to the discussions with country offices, the solution lies in the introduction of guidelines that clarify and standardize HACT assurance activities to an extent where the documented results of on-site reviews would meet quality standards which are similar to those of project-based audits.

147. Many country offices have commented on the capacity of SAIs to conduct special audits or

scheduled audits of internal controls for cash transfers. The HACT framework stipulates that the SAI with adequate capacity can undertake the HACT-related audits of government implementing partners. NGOs will have to be audited by independent audit firms. According to the results of the online survey, the majority of respondents do not believe that the SAI in their country have the capacity to conduct the HACT audits.119 While some respondents question the independence of the SAI when conducting audits for government institutions, the main concern is related to the actual capacity to undertake audits that would correspond to international standards and be accepted by the agencies internal audit departments. Stating that HACT-related audits will have to be conducted by external audit firms, some country offices emphasized that it might be difficult to deal with government entities as they are hesitant to be audited with a focus on their internal controls. Similar to the challenges connected to capacity assessments, government implementing partners are concerned that weaknesses at the institutional level would be exposed. This is not the case with audits relating to project activities.120

5.2.4 Challenges Related to UN Capacity 148. A noteworthy advantage of HACT assurance activities lies in the implementation of a well-designed

assurance and audit plan. Assurance activities translate a coordinated approach into concrete action. While agencies have the opportunity to conduct spot checks and audits together for common implementing partners, assurance activities are also merging programme management with financial management. In cases where programme and operations staff conduct spot checks together, the interdependencies between progamme management and financial management are better understood and potentially lead to more efficient implementation practices at the agency level. A common approach of assurance activities potentially leads to a reduction of transaction costs within individual agencies as project monitoring and financial transactions are better coordinated. However, in most reviewed country offices, HACT practices are mainly carried out by operations staff. This is supported

119 Annex II, Online Survey, Question 41. 120 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO); Annex II, Online Survey, Question 42: Comments on Section Assurance.


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by the fact that in a majority of countries, the HACT implementation is delegated to the Operations Management Team (OMT).121

149. Assurance activities build the core of the HACT implementation. While the capacity assessments determine the potential risk connected to financial transactions with implementing partners, they constitute a prerequisite to the actual implementation of HACT. By identifying opportunities for capacity development and determining the risk rating, the micro assessment is an important instrument in the process of enabling the implementation of HACT, however it should not be interpreted as an element of the implementation itself. In this regard, many practitioners see significant weaknesses in the HACT framework because it emphasizes the importance of macro and micro assessments and provides only very limited guidance on assurance activities and how they would lead to measurable capacity development at the implementing partner level. This argument was supported in a number of senior management interviews at headquarter level.

150. While the HACT framework provides overall guidance on the frequency of periodic on-site reviews,

the planning and execution of assurance is subject to the interpretation and capacities of the UN at the country level. The majority of countries implementing HACT have voiced their significant challenges ensuring regular on-site reviews for government and non-government implementing partners. UN agencies in countries with a large number of implementing partners are overwhelmed by the capacity needed to follow up with spot checks and other assurance activities. Site visits often require several days of travel to remote areas, resulting in the absence of staff members from the office for extended time periods. In addition to time constraints and the limited amount of available staff at the country level, many countries commented that their staff is not capacitated to conduct on-site reviews aiming at verifying internal controls and financial transactions. The possibility of outsourcing spot checks and other assurance activities to audit/consulting firms is not seen as a realistic option by many countries because it would be very costly and create political challenges similar to the macro and micro assessments.122

151. Despite the significant challenges of implementing frequent assurance activities, some countries have made considerable progress in conducting on-site reviews. Following the findings of the recent HACT assessment in Mozambique, agencies conducted a total of 146 on-site reviews in a timeframe of about 18 months. In addition, two on-site reviews were conducted jointly by two or more agencies. With a total of 224 implementing partners as of July 2010, the UNCT Mozambique managed to conduct reviews for about 65% of their implementing partners. 123 Despite the impressive efforts of the HACT implementing agencies in Mozambique to carry out adequate assurance activities for mostly ‘medium’

121 Assurance activities as being an adequate instrument to merge programme and operations has been highlighted in some of the headquarter-based interviews with senior agency staff. 122 See ‘Framework for Cash Transfers to Implementing Partners’, p.8; See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 123 According to the assessment, UNICEF reviewed 67 out of 154 implementing partners, UNDP reviewed 26 out of 24 implementing partners and UNFPA reviewed 53 out of 46 implementing partners. While some implementing partners have not been reviewed, others have been reviewed several times in the period. Please note that the data refers to July 2010. See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.18.


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and ‘high risk’ partners, it appears to be impossible to ensure coverage of all implementing partners within an appropriate timeframe. For smaller countries with far fewer implementing partners, the provision of adequate and timely assurance activities seems to be possible. This was confirmed by HACT focal points from Gambia who stressed that due to the easy accessibility and limited number of implementing partners (approximately 50), on-site reviews and training activities are possible.124

152. It has been stressed that HACT assurance activities could lead to a reduction of transaction costs as agencies would act on the basis of a joint assurance and audit plan, which ensures that on-site reviews and audits are conducted together for common implementing partners. While this would reduce the burden on agencies, it also reduces transaction costs for implementing partners who are no longer subject to different assurance activities by several agencies. However, in accordance with the information gleaned through the global annual updates and most of the interviews with country offices, the number of common implementing partners is very low. Based on these findings, it was argued in some of the interviews that the opportunity costs for establishing harmonized assurance and audit plans at the country level are too high. While in most countries there is only a small number of implementing partners, the emphasis on creating joint assurance and audit plans as a condition for carrying out assurance activities reflects a concentration on processes rather than results.

5.3 Capacity Development of Implementing Partners 153. The development and management objectives as described in the HACT framework are the

cornerstones of the intended capacity development effect of HACT. The framework stipulates that the cash transfer framework impacts the programming process through the key findings of the macro assessment and that, based on the results of the CCA analysis, agencies might be selected to address identified gaps.125 While HACT is designed to address capacity gaps at the institutional level of implementing partners, there are no findings that would support the notion that HACT introduces a programmatic approach to developing the financial management capacity of implementing partners.

154. Nevertheless, the implementation of HACT intends to develop financial management capacity over

time with the aim of decreasing the number of transaction cost-intensive ‘high risk’ partners. In this regard, many countries confirmed that they have conducted targeted trainings for implementing partners in addition to undertaking assurance activities. According to the online survey, about 44% of all respondents confirmed that a training plan has been established to strengthen the financial management capacity of implementing partners.126 While many countries confirmed that they have provided HACT training to implementing partners, a number of challenges have been identified. The most significant challenge seems to be successful inter-agency coordination in the preparation and execution of HACT trainings. In accordance with the online survey in which 54% of the respondents

124 Teleconference with the Gambia country office from 01 November 2011. 125 See ‘Framework for Cash Transfers to Implementing Partners’, p.4 and 14. 126 Annex II, Online Survey, Question 43.


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identified this as a major challenge, similar feedback has been received in interviews and through the global annual update. It seems that many agencies provide training to implementing partners without coordinating their efforts with other HACT implementing agencies.127

155. In addition to the lack of successful inter-agency coordination, major challenges in providing

training to implementing partners have been identified as the high turnover of staff at the implementing partner level, the lack of standardized training material, the lack of interest of implementing partners, the involved costs to provide trainings, and the high number of implementing partners.128 Many comments from practitioners related to the difficulties of providing training for implementing partners in remote locations outside of the capital. Similar to the challenges in connection to on-site reviews, trainings in many different locations are difficult to organize and very costly, and require the absence of staff from the office for an extended period of time.

156. The very high staff turnover at the implementing partner level has been identified as a huge

problem by almost all HACT implementing countries. It is frequently not possible to translate the training efforts into an increasing institutional knowledge. While this applies to government as well as non-governmental implementing partners, many government institutions have a system of staff rotation for accountants and other finance staff.129 As a result, there is a high probability that transaction costs in this regard are not diminishing over time, but that the provision of frequent training to implementing partners constitutes a recurring cost. In addition, it seems unlikely that through assurance activities and HACT training for implementing partners risk ratings would go down over time. This is supported by the interviews with country offices, which confirmed that capacity building measures have only a very minimal impact on risk ratings.

157. Despite its tools for capacity assessments, HACT largely lacks a strategy for how to develop

capacity. Following this, the country team in Sierra Leone has put much emphasis on capacity development and has introduced a Capacity Development Guide in cooperation with the government. The guide is based on an expanded micro assessment methodology which comprises programme management. Named Direct Programme Support (DiPS), the approach aims to provide a more comprehensive support to government and NGO implemented programmes in the country.130 While this approach could be identified as a best practice to answer many of the capacity building challenges, it clearly indicates a merger between cash disbursements to enable programme implementation and programme implementation itself.

158. Based on feedback from a number of countries, the question is whether the UN is best placed to

successfully contribute to improve financial management of government and non-governmental implementing partners. It is important to note that training provided to implementing partners is in most cases entirely focused on HACT guidelines and limited to ensuring compliance with UN policies

127 Annex II, Online Survey, Question 44; See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO). 128 Annex II, Online Survey, Question 44, including comments. 129 Annex II, Online Survey, Question 44, including comments; Question 48: Comments on Section Capacity Development. 130 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO).


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and procedures. In the majority of countries, training has not gone beyond this, concentrating on actually improving the institutional capacities of implementing partners, including principles of accounting, internal control frameworks and cash management.

159. Different from the understanding of most practitioners, it was pointed out in one headquarter

interview that the capacity building objective of the HACT framework is directly related to the effects of the application of HACT procedures. For example, capacity assessments would provide a significant amount of capacity development. The provision of financial management training beyond a specific training on HACT policies and procedures would not have been the objective of the HACT framework, which introduces capacity development at a strategic level. Therefore, it would be important to bring the findings of HACT capacity assessments into the CPAPs, which requires more involvement of the programme side.

160. While the transaction costs for providing training to implementing partners are very high, it seems

that none of the UN agencies has a comparative advantage in transferring comprehensive financial management knowledge. As implied by one comment to the online survey, the UN could establish partnerships with other development agencies to contribute to overall improvements of the PFM systems.131 If done right, the effective provision of frequent financial management trainings to implementing partners cannot be organized as an operational support activity. With well over 150 implementing partners in a number of countries, this would constitute a programmatic subject matter. In this regard, the UN should review the implementation of a complex cash transfer system that is dependent on high capacity levels outside of the expertise of any UN agency.

5.4 Interpretation of HACT Compliance 161. As per the recent global annual update 31 of all HACT implementing countries reported to be HACT

compliant, corresponding to a rate of 32.3%. The interviews at headquarter level and with country offices have shown that there is a different understanding of the concept of HACT compliance. With regard to the global annual update, a number HACT focal points have pointed out that they are unclear about what constitutes HACT compliance. While the global annual update requests that countries report on their compliance, many practitioners are not fully aware of the minimum requirements to reach such status.132

162. Question 15 of the online survey contains a combination of eleven different criteria in order to

answer the question about the minimum conditions for a programme country to be HACT compliant. While the majority of respondents correctly checked most of the steps as described in the below definition, many respondents went beyond the minimum requirements. If sorted by individual

131 Annex II, Online Survey, Question 44, including comments; Annex 2, Question 48: Comments on Section Capacity Development. 132 Annex II, Online Survey, Question 15, including comments.


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respondent, all possible answer combinations are well represented, supporting the finding that there is no common understanding about the concept of HACT compliance.133 In a follow-up question, nearly 52% of 329 respondents pointed out that they are of the opinion that their country is not HACT compliant. While 40% answered that their country is compliant, almost 8% answered that they do not know the status. Sorting the answers by country, they do only in part correspond to the countries which reported being HACT compliant in the recent global annual update.134

5.4.1 UNDG Definition of HACT Compliance 163. According to a UNDG paper, HACT compliance is achieved when:

• The macro assessment has been completed or ‘high risk’ has been assumed;

• All partners receiving US$100,000 (or a limit set by the agencies at the country level) collectively from UNDP, UNFPA, UNICEF and WFP (and any other agencies that have agreed to adopt HACT in the country) have been micro assessed or ‘high risk’ has been assumed for implementing partners where micro assessment could not be completed;

• There is agreement on HACT implementation with the government either in the CPAPs or through exchange of letters; and

• An assurance and audit plan of implementing partners has been developed and implementation mechanisms agreed upon.

In addition, it is stated that since HACT is a harmonized approach among UNDP, UNICEF, UNFPA and WFP, all of these agencies have to meet the above criteria. If any of the four agencies at the country level does not meet the above criteria, compliance is not achieved. The Resident Coordinator (RC), along with the representatives of the individual agencies, certifies that the above steps are complete and that the UNCT is HACT compliant. The RC should also inform the relevant Regional UNDG Team with a copy to UN DOCO.135

164. UNDP has applied the same four criteria for their country offices as a requirement to move from an

NGO/NIM audit approach to a HACT audit approach. In addition, the Resident Representative has to confirm in writing that HACT has been fully implemented by the UNDP country office for at least 12 months.136 While the actual application of HACT audits is not explicitly mentioned as criteria for HACT compliance, the development of an assurance and audit plan and agreement on the implementation mechanisms imply that the HACT audit regime is to be applied.

133 Annex II, Online Survey, Question 15. 134 Annex II, Online Survey, Question 16. 135 See ‘Frequently Asked Questions – Harmonized Approach to Cash Transfer’ (UNDG 2009), p.4-5. 136 See ‘Option for HACT Audit’ UNDP.


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5.4.2 Review of the HACT Compliance Criteria 165. In review of the UNDG criteria for HACT compliance, it has to be assumed that the actual number of

HACT-compliant countries is much lower than reported. Apart from WFP not implementing HACT in most countries, there is no evidence for the certification of UNCTs through Regional UNDG Teams or UN DOCO. In addition, while a number of countries have developed a joint assurance and audit plan, in most cases there have been no changes to the implementation of the NIM audit approach by UNDP and UNFPA. According to several comments in the online survey, the reason for this is that the requirements of the agencies’ internal audit departments would not allow for a move to HACT audits.137

166. The four major criteria listed in the UNDG definition of HACT compliance describe steps in the HACT

process which together contribute to some of the prerequisites enabling a harmonized cash transfer approach. Government agreement, capacity assessments and the development of an assurance and audit plan are by themselves – or in accumulation – no indicator for the actual implementation of HACT at the country level. Being HACT compliant as per the above definition does not indicate to what extent HACT has been implemented or whether any of the objectives of HACT, such as capacity development of implementing partners and the reduction of transaction costs, have been achieved. Therefore, the concept of HACT compliance concentrates on the completion of process steps which have no measurable impact on the achievement of results.

167. Consequently, a number of countries that are fulfilling the criteria for HACT compliance are actually

not fully implementing HACT. A full implementation of HACT would involve facilitating assurance in accordance with the results of the capacity assessments through qualified on-site reviews and moving to a common HACT audit regime. In addition, it would require the consequent discontinuation of parallel financial control mechanisms, such as requesting invoices and bank reconciliation statements as annexes to the FACE form. Hence, the successful implementation of HACT is dependent on the execution of HACT-relevant activities as much as ensuring that the parallel application of financial control mechanisms is brought to a close.138

168. The HACT compliance designation has led to many different interpretations and, more important,

introduces a process rather than results orientation. It is imperative that a concept of HACT compliance or full HACT implementation is based upon a set of results-oriented and measurable indicators. Apart from enabling a better evaluation of the HACT implementation process, these indicators, along with clearer guidance, would greatly support a better orientation on how to operationally implement HACT.

137 See Annex II, Online Survey, Question 20, including comments. 138 These findings are supported by the interviews at headquarter and country level and the audit report of the recent joint HACT audit in Malawi, where it was stated that there is a lack of consistent policy and implementation between the agencies, their headquarters and field offices on the conversion of the audit regime from NIM to a complete HACT compliance. See Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi, p.11.


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According to the results of the online survey, more than 72% of all respondents stated that they need clearer guidance on how to operationally implement HACT.139

139 Annex II, Online Survey, Question 17.


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169. The following table shows examples of results-oriented indicators that could serve to measure changes as a result of full HACT compliance:

Table 5.4.1: Sample Indicators for Full HACT Implementation

170. The above samples of results-oriented indicators go beyond measuring the implementation of

HACT-relevant process steps. Moreover, the indicators already assume a full implementation of all process steps, such as government agreement, macro and micro assessments, usage of the FACE form and an endorsed joint assurance and audit plan. In addition, the indicators build on a high degree of existing inter-agency coordination, including trainings for implementing partners and an established UNCT HACT working group which acts upon an endorsed AWP. For example, measuring the number of HACT trainings held would not necessarily imply changes in the institutional capacity of implementing partners. Even if it were possible to establish standardized exams at the end of each training, the frequent staff turnover prevents a direct cause-and-effect relationship between number of trainings held and increased capacity.140 Therefore, the only option to measure HACT compliance which effectively supports the objectives of HACT seems to be the design of indicators measuring variances, turnaround times and number of errors over time through HACT-relevant instruments.

140 Please see section 4.6 of this assessment where reference is made to findings in relation to the high staff turnover at implementing partner level. Many comments to the global annual update and in the online survey pointed out that HACT trainings often have a very limited effect as the knowledge transfer to individuals does not translate into institutional knowledge. See Annex II, Online Survey, Question 44, including comments, See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO).

Result Measured Time Period Indicator

Increase of IP Capacity Programme Cycle

Number of Changes in risk ratings per programme cycle as a result of micro assessments.

Increase of IP Capacity Annually

Number of risk related findings per defined category as a result of regular on-site reviews.

Increase of IP Capacity Quarterly

Number and amount of variances of expenditure versus budget line items in quarterly reports.


Turnaround time measured in days for quarterly reporting through the harmonized FACE form.


Number of errors by defined category in quarterly reporting through the harmonized FACE form.

Increase of UN Efficiency

Programme Cycle

Percentage of HACT audits versus NEX audits over number of implementing partners.


Annually

Time variance measured in days for on-site reviews as scheduled in joint assurance and audit plan.


Annually

Percentage of One UN on-site reviews for common implementing partners.


Quarterly

Percentage of results achieved as per UNCT HACT working group Annual Work Plan.

Decrease of Transaction Costs

Annually

Cost variance between sum of macro assessment, micro assessments, HACT audits and NEX audit regime per IP.


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6 The Role of Specialized Agencies 171. According to the available information, there is limited experience with the participation of

specialized agencies in the HACT process. As per the recent global annual update, only five countries reported the participation of one or more specialized agencies in the HACT implementation process. However, the interviews have shown that there is a notable interest of specialized agencies in the HACT concept. Specialized agencies closely follow the ongoing HACT implementation and frequently participate in inter-agency groups and committees. This includes the UNDG HACT Advisory Committee where, apart from UNDP, UNFPA, UNICEF, and WFP, the specialized agencies UNESCO, FAO, UN-HABITAT, UNCHR, UNIDO and FAO are represented.

172. Table 6.1.1: UN Programmes and Specialized Agencies Implementing HACT


173. The above table reveals that there has been very limited involvement of specialized agencies in the

HACT implementation at country level. The countries that integrate more than one additional agency are Tanzania and Mozambique which, as pilot countries of the DaO agenda, have successfully advanced in the HACT implementation process through integrating HACT into their overall change management agenda.141 According to the country-led evaluation report of Vietnam, a number of specialized agencies have agreed to adopt HACT at UNDG meeting in April 2008. While FAO, UN HABITAT, UNESCO, UNOPS, and UNIDO have confirmed to pilot HACT in DaO countries, ILO agreed in principle but wanted to conduct more internal assessments before proceeding.142 Despite the low rate of active participation, specialized agencies have shown a significant interest in adopting HACT where it would lead to efficiency gains through higher harmonization and standardization of processes. As there has been no evidence that the adoption of HACT has led to a reliable reduction of transaction costs for UN agencies and implementing partners, specialized agencies seem to carefully review whether moving to a risk based financial management approach under HACT is viable.

141 See ‘Addressing Country-Level Bottlenecks in Business Practices, High Level UNDG-HLCM Mission’ Mission Report. 142 See ‘Country-led Evaluation, Delivering as One; UN Pilot Initiative in Vietnam’ (2010), p.55

Country FAO ILO UNAIDS UNESCO UNHCR UNIDO UN Woman

WHO

Tajikistan √

Tanzania √ √ √ √ √ √ √

Togo √

Mozambique √ √ √

Nicaragua √


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174. According to the interviews with FAO and UNIDO as part of this assessment, a number of specialized agencies follow very different business models which are not entirely compatible with the procedures as stipulated in the HACT framework. UNIDO, for example, has started to pilot HACT in Mozambique with three implementing partners which have recently been micro assessed, utilizing a common long term agreement with a local audit firm. The first experiences have shown that UNIDO, through its limited presence in the country, has little control over the process. For example, it is not in the position to effectively contribute to common assurance activities and has to rely on risk ratings and information provided by other UN agencies. Unable to fully control the assurance process, UNIDO faces challenges to forego financial controls, such as the collection and review of invoices. In addition, most of UNIDO’s expenditures are subject to international tenders, other direct procurement activities and recruitment. The limited cash disbursement at country level is accompanied with a maximum local spending limit of US$20,000. Each amount exceeding US$200,000 has to be approved by headquarters in Vienna. Particular challenges are expected with donor reporting as, according to UNIDO, it will be difficult for donors to understand that tranches have been transferred to implementing partners without executing diligent financial controls.

175. FAO and UNIDO confirmed that they would expect a significant reduction of transaction costs as a

result of joining HACT. Up to date, both agencies stated that the coordination of related activities required an unexpected high amount of time and effort. It was underlined by FAO that changes at the country level are frequently not well coordinated with the specialized agencies. In this regard, a high level of standardization would make the necessary investment of joining HACT more predictable and reduce the number of unforeseen policy changes at the country level. While there is a clear vision of the HACT concept at UNDG level, it has not been translated into a common understanding at the country level. With limited resources and local presence, specialized agencies have not entirely assessed the feasibility of HACT for their business models. Apart from this, it appears that not the HACT concept itself, but the experienced management and coordination challenges are mainly responsible for the limited involvement of specialized agencies.

176. According to the interviews, specialized agencies are principally interested in joining HACT and have

started piloting HACT procedures with some of their implementing partners. The experience with the pilot initiatives has shown that there are major challenges in terms of the country-level coordination and management of HACT. Specialized agencies have incurred high transaction costs following up with their participation in the management of micro assessments, the design of an assurance and audit plan, and the execution of assurance activities. It was mentioned that, apart from adapting internal financial policies and procedures, the leadership at the country level is the most important element for a successful integration of specialized agencies. UNCTs are frequently adapting the HACT framework to their own requirements without the participation of specialized agencies. Therefore, it is challenging for specialized agencies to join HACT where local decisions might affect their own financial transactions without the ability to exercise control. One example is the execution of NIM audits in lieu of HACT assurance activities, which implies that specialized agencies cannot rely on a common execution of assurance activities as a result of joint planning.


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7 Governance and Coordination 177. The implementation of HACT depends on the successful harmonization of related business

practices. As per the HACT framework, all major steps in the implementation process require a high degree of inter-agency coordination pointing at the increased role of the UNCT as the decision making body of the UN at the country level. While HACT has not been adopted by many agencies and in most countries is implemented by UNDP, UNFPA and UNICEF, the majority of funds of the UN at the country level are mostly disbursed trough HACT procedures. In fact, most of the government implementing partners and many NGOs in HACT implementing countries are subject to HACT-related capacity assessments and disbursement procedures. This implies that joining HACT is likely to be an attractive option for specialized agencies as they often share a number of implementing partners with the three former ExCom agencies.

178. Despite the implementation of HACT in currently 96 programme countries, there are no findings on

existing standard operating procedures (SOP) or guidelines on how to manage and coordinate the HACT implementation at the country level. The lack of standardization has led to a variety of approaches with mixed results in terms of both implementation progress and level of harmonization. Feedback from almost all HACT implementing countries confirmed that the biggest challenge of HACT is the lack of management and coordination in the implementation process. While many practitioners refer to the inter-agency coordination at the country level, it has also been pointed out that the lack of clear guidance from agencies as well as inter-agency bodies at the regional and headquarter level hinder a successful implementation.143 A full 72.3% of all respondents of the online survey stated that they need clearer guidance on how to operationally implement HACT. Furthermore, the majority of respondents request more support in UN inter-agency coordination; 59.1% believe that this would be best provided by more specific guidelines and 45.9% request the development of related SOPs.144

7.1 Distribution of Roles and Responsibilities 179. The HACT framework introduces a cash disbursement methodology that requires a high degree of

inter-agency coordination and a clear understanding of the roles and responsibilities of inter-agency bodies at the regional and headquarters levels. While the framework describes the process steps and what is required to implement HACT, it assumes well-functioning inter-agency coordination and stops short of describing how to best manage its significant complexity. Moreover, the framework refers to agency-specific guidelines in the decisive areas of assurance and audit, which have been identified as the source of the greatest challenges to a harmonized approach. As mentioned above, the framework

143 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO), Responses from Country Offices on reasons/bottlenecks for the implementation of HACT. (UN DOCO), Annex II, Online Survey, Question 56: Comments on Section Governance and Coordination. 144 See Annex II, Online Survey, Question 17 and 18.


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has not been supplemented with specific guidelines or SOPs to effectively address these challenges. According to the findings, the distribution of roles and responsibilities between inter-agency bodies as well as the involved parties at the country level has not been clearly defined.

180. Figure 7.1.1: Complexity of HACT Coordination 181. As illustrated in figure 7.1.1, the implementation of HACT introduces a complexity comparable to

other functional areas that have been subject to inter-agency harmonization in the course of the UN reform process. In comparison to other areas of inter-agency harmonization, the requirement to coordinate the HACT implementation at the country level is perceived to be extremely challenging. The reason for this is that HACT is subject to different financial regulations and rules translating into agency-specific policies and procedures that, up to now, have made a fully harmonized implementation of HACT impossible. This is particularly the case in the area of common assurance activities where agencies continue to impose different audit regimes. Therefore, agency focal points at the country level are frequently confronted with the request to further harmonize the implementation of HACT along with the reminder to adhere to agency-specific policies and procedures.

Inter-agency Coordination Intra-agency Coordination

United Nations Development Group

Regional Office

Regional Office

Regional Office

Resident Coordinator

HLCM

Regional UNDG Team

UN DOCO HACT AC

CEB

RCO

HACT Working Group

Head of Agency Head of Agency Head of Agency

Country-level Coordination

UN Country Team Country

Office Country Office

Country Office

Agency A HQ

Agency B HQ

Agency C HQ


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182. According to teleconferences with various country offices, the absence of UNDG-approved guidelines and SOPs makes it difficult to successfully address requirements from agency headquarters that contradict the HACT framework. One example that was mentioned is the regulation of assurance activities, in particular regarding the contents and frequency of on-site reviews. Specific and UNDG approved guidelines, including a standardized checklist that results in clear information about the financial risks, would constitute a basis for country offices to request headquarter approval in order to move from a NIM audit regime to the implementation of scheduled HACT audits.

183. The inter-agency coordination of HACT is steered through the UNDG HACT Advisory Committee. All

member agencies, funds and programmes of the UNDG are invited to participate in the committee and are on an annual basis requested to appoint representatives who speak and decide on behalf of their agency, fund or programme. Chairmanship of the committee is established on a rotational basis and currently is owned by UNICEF. The committee is supported by UN DOCO as part of its overall coordination function. In particular, UN DOCO facilitates organizational aspects of the committee’s work by supporting the communication between members and coordinating some of the managerial functions. In addition, UN DOCO directly supports the HACT implementation through its cooperation with the Regional UNDG Teams. While providing functional expertise through its Headquarter Support Team (HST), direct country-level support is facilitated through its Field Support Team (FST) which is functionally divided according to the six regions. This ensures direct communication with the Regional UNDG Teams and focal points for different functional areas. Therefore, HACT-relevant issues are discussed by the HACT Advisory Committee and brought forward for decisions to the UNDG. UN DOCO facilitates decisions by the UNDG, ensuring the awareness of agencies, funds and programmes, and coordinates the HACT implementation through the Regional UNDG Teams.

184. The information as per the global annual updates suggests that the Regional UNDG Teams have

some defined roles and responsibilities in the HACT implementation process. This is supported by the fact that they frequently approved requests from UNCTs to defer HACT implementation and that RCs are required to inform their Regional UNDG Team in writing as soon as HACT compliance has been established in their country.145 Other than this information, there are no findings that would support the existing implementation of any institutionalized and clarified distribution of roles and responsibilities. This has been supported by several comments from practitioners pointing out the lack of feedback and guidance from the regional inter-agency bodies. Further, no clear distribution of roles and responsibilities between the Regional UNDG Teams and UN DOCO focal points could be observed. Due to a very limited functional expertise related to HACT at the Regional UNDG Teams and UN DOCO’s FST, country-level focal points are frequently circumventing established communication lines and seeking support directly from the focal points at UN DOCO’s HST. Due to the large number of countries, this exceeds the capacity of the few individuals at HST to properly and timely ensure qualified feedback.146

145 See point 5.4.1 Definition of HACT Compliance. 146 The unclear distribution of roles and responsibilities between inter-agency bodies is supported by the finding that it took several months to finalize the process of the recent global annual update. Roles and Responsibilities between UN DOCO, Regional Coordination Specialists and country-level focal points have not been institutionalized. Therefore, the process is frequently


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185. The analysis of the global annual update has supported the finding that the HACT implementation process has not been accompanied by established and clearly communicated procedures. UNCTs decide to postpone the implementation of HACT with or without UNDG-approved deferral. Moreover, there seem to be no established criteria that would drive the decision making process at UNCT or the regional UNDG level. The analysis of the global annual update suggests that in countries with comparable circumstances, some UNCTs decide to drive the HACT implementation process forward while others decide to postpone HACT implementation with or without seeking UNDG approval.147 As the HACT framework does not foresee any circumstances that would prevent the implementation of HACT, it does not include any guidelines or criteria for deferral. In absence of established criteria, Regional UNDG Teams seem to decide on a case-by-case basis. While the establishment of certain criteria would be advisable to guide the decision making process, it seems appropriate to allow enough room for recognizing the particular circumstances in each country that could lead to the decision to defer the implementation of HACT.

186. As illustrated in figure 7.1.1, UNCT decisions about HACT are more likely the result of an intra-agency decision making process of relevant former ExCom agencies. If any of these agencies decide not to implement HACT as a result of their own headquarter consultations, the probability for the UNCT to influence this decision can be described as very low. The interviews and teleconferences have shown that HACT has not been interpreted or institutionalized as a mandatory process. Although implemented as a UNDG-approved framework, individual agencies at the headquarter and country-level seem to reserve the right to withhold the implementation or adapt the framework to their own requirements. As a result, there are no established agency-specific policies that would allow an inter-agency body to hold individual staff members at senior management or other levels accountable for the implementation of HACT.148

accompanied by the need of extensive communication to receive updates from countries through the Regional UNDG Teams. In addition, there is no mechanism in place to enforce accountabilities. 147 See Annex III, Global Annual Updates 2008-2011: Summary Table. 148 This finding has been supported by several comments indicating that agency representatives are not prioritizing the HACT implementation leading to significant hindrances for inter-agency HACT working groups and individual focal points to carry out related activities. See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO), Responses from Country Offices on reasons/bottlenecks for the implementation of HACT. (UN DOCO). Supported by its findings, the Impact Assessment Study of HACT in Mozambique concludes that some UNDG guidelines have not been translated into country-level policies and operations. Further, country-level HACT policies and decisions are not always implemented accordingly by UN staff members. This has resulted in three different HACT realities: (i) UNDG policies, (ii) adjusted country-level policies and operations, both jointly and agency-specific, and (iii) the actual management practice of individual UN staff members. See ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.31.


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187. In summary, the HACT implementation has been accompanied by an unclear distribution of roles and responsibilities at the inter- and intra-agency level. This is coupled with the absence of an accountability framework that would translate HACT policies and procedures into personal responsibilities of UN staff in relevant positions. The following table describes the possible distribution of roles and responsibilities for a series of HACT-relevant activities among inter-agency bodies.149 Table 7.1.1: Distribution of HACT Relevant Roles and Responsibilities

Activity UNCTs Regional

UNDG Teams UN DOCO

HACT Advisory Committee

Technical Support to UNCTs Responsible Coordination

Strategic Guidance to UNCTs Responsible Coordination

Development of Training Packages Support Function Responsible

Provision of Training to UN Staff Responsible Support Function

Development of Guidelines Support Function Responsible

Interpretation of Guidelines Responsible Support Function

Provision of Annual Status Update Responsible Coordination Coordination

Administration of HACT Databases Responsible

Resolution of Country-specific Issues Responsible Support Function

Decision on HACT Compliance Responsible

Decision on HACT Waivers Responsible Support Function

Monitoring of HACT Implementation Responsible Support Function Coordination

7.2 Challenges Related to Country-level Coordination 188. In the online survey, 79% (215) of the respondents answered that there is an inter-agency HACT

working group in their country.150 However, in different countries working groups are reporting to a variety of country-level entities. While 31% stated that the HACT working group directly reports to the UNCT, about 21% selected the RCO and 15% the OMT as the supervising entity.151 In many cases, the OMT itself is dealing with HACT as part of its operational responsibilities. This implies that in many countries, HACT is perceived as an operational issue and disconnected from a direct involvement of programme staff. This has been confirmed by a number of comments in the global annual update and in the teleconferences with country offices. Although a 79% rate seems high, many HACT working groups cannot be considered fully functional. Several practitioners confirmed that the groups are not meeting on a frequent basis and that the participation level is consistently low. A number of staff

149 The table is aligned to Question 55 in the online survey and has been adapted for roles and responsibilities of inter-agency bodies. See Annex II, Question 55. 150 See Annex II, Online Survey, Question 49. 151 See Annex II, Online Survey, Question 50.


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members stated that the reason for this would be the lack of support by senior management and that HACT is not given the necessary attention by the UNCT.152

189. To clarify the performance level of the existing HACT working groups at country level, the online

survey included questions regarding the meeting frequency and implementation of joint activities connected to the HACT implementation. Only 14% of the respondents stated that their HACT working group meets approximately once per month or more during a calendar year. While 21% confirmed that their working group meets one to three times per year, 5.5% stated that they would never meet.153 This implies that in many HACT implementing countries agencies do not frequently interact on related issues or exchange information to harmonize their approach. This is supported by the results of the online survey where the majority of respondents stated that there is no joint HACT database established in their country.154

190. Although more than 70% of all respondents confirmed that there is an inter-agency HACT focal

point in their country, most of the HACT related activities seem not to be undertaken jointly. While micro assessments are to a large extent carried out together, other activities as spot checks, trainings, and HACT audits are mostly executed by individual agencies. For example, 51% of all respondents answered that there is no common audit activity. A further 20% stated that joint audits are carried out to a very limited extent.155 This information supports the findings about persisting differences between the agencies’ audit regimes. While the implementation of a common HACT audit regime at country level will require a solution at headquarters, activities such as spot checks, trainings for UN staff and for implementing partners, and the development of a joint assurance and audit plan seem possible within the bandwidth of different financial regulations and rules. It is noteworthy that only 12% of all respondents confirmed that an assurance and audit plan exists and is fully managed and implemented jointly.156

191. In many countries, the RCO has taken over the coordination role for the implementation of HACT.

Accordingly, about 38% of all respondents stated that the focal point for the inter-agency coordination of HACT is a staff member at the RCO. Driving the harmonization of HACT activities through the RCO has been perceived as helpful for a variety of reasons. First, different than appointing a focal point from an individual agency, the RCO is recognized as an impartial entity, acting in representation of the UNCT. Second, in a number of countries, the RCO facilitates the coordination of the UN reform agenda, including the harmonization of business practices and the development of joint programmes. In some countries, strengthening the RCO beyond the secretariat function of the UNCT has resulted in a remarkable progress in the reform process. Particularly the centralized management of UNCT inter-agency working groups has led to a more effective follow-up of issues at agency and UNCT level. For

152 See ‘Country Comments: 2011 Global Annual Update’ (UN DOCO), Responses from Country Offices on reasons/bottlenecks for the implementation of HACT. (UN DOCO) 153 See Annex II, Online Survey, Question 51. 154 Annex II, Online Survey, Question 53. 155 Annex II, Online Survey, Question 53. 156 Annex II, Online Survey, Question 53.


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HACT, this includes the management of a common HACT database, the coordination of joint trainings and effectively supporting the development and monitoring of a results-oriented work plan.157

192. Following the findings of the global annual update analysis and the feedback from a large number

of UN staff members, HACT has not been followed up with as one of the prioritized coordination issues at country level. While intra-agency disagreements seem to frequently hinder a successful harmonization of HACT-related business practices, in most countries there is little incentive for HACT-implementing agencies to work together. The reason for this is that the cost of coordination is perceived to be much higher than the potential benefits from harmonizing HACT-related activities. Apart from agency-specific differences, the very limited amount of common implementing partners among the three major HACT implementing agencies does not justify the significant efforts to coordinate HACT relevant activities. As for individual agencies, a harmonized approach is not critical for the successful implementation of HACT, pushing for an effective inter-agency coordination of HACT-related activities remains a low priority issue for most UNCTs.158

193. The headquarter interviews have shown that there is a continuous commitment to inter-agency

coordination. However, there is a consensus amongst a number of senior management staff that inter-agency coordination and the harmonization of business practices must not comprise the efficiency of individual agencies at the country level. As confirmed in a teleconference, delays in the procurement process of a common audit/consulting firm have led to pending micro assessments for a period of over one year. In several countries, the development of a joint assurance and audit plan has taken up to two years. This has led to significant delays in carrying out assurance activities for ‘medium’ and ‘high risk’ implementing partners. Related to the challenges of coordination at the country level, it has been suggested in some of the interviews that individual agencies should be able to implement HACT activities without the risk of moving at the pace of the slowest implementing agency.

194. In a number of headquarter interviews, it was stressed that the RC leadership role is imperative for

a successful implementation of HACT at the country level. RCs have a decisive influence on the prioritization of issues and the set-up of a support structure enabling follow-up, monitoring and implementation of inter-agency relevant subjects. The experience from DaO countries has shown that the success of common UN initiatives is highly dependent on an effective organizational structure which allows for short communication ways, efficient coordination of activities and the distribution of clear accountabilities to UNCT-appointed staff. Translated to the implementation of HACT, this includes the establishment of a HACT working group which directly reports to the UNCT. Members from progamme and operations are appointed by the agency representatives and authorized to act and speak on behalf of their organization. The results-oriented AWP is endorsed by the UNCT and subject to quarterly reporting on the progress made and challenges observed.

157 See ‘Addressing Country-Level Bottlenecks in Business Practices, High Level UNDG-HLCM Mission’ Mission Report, ‘Impact Assessment Study of Harmonized Approach to Cash Transfer (HACT) in Mozambique’ p.22. 158 See table 4.3.1 for a list of countries with the number of implementing partners per agency versus the number of common implementing partners.


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195. The establishment of a joint HACT database is vital to create a level of institutional knowledge that is necessary to follow a well coordinated approach to common assurance activities, HACT trainings and appropriate cost sharing mechanisms. From the information obtained, it appears that the majority of programme countries have not established a functioning management system that allows an effective and common approach to HACT. Apart from the complexity of HACT, government resistance and high transaction costs, a major challenge is that many countries have not established a systematic approach, reflected in a simple, effective and UNCT-prioritized management structure.


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8 Conclusion 196. HACT is a relevant concept as part of the UN reform process. The development of the HACT

framework and its introduction in 2005 stand for a successful inter-agency coordination during the initial stages of the UN reform process. With its objective to support a closer alignment of development aid with national priorities and strengthen national capacities for management and accountability, the HACT concept aims to facilitate a gradual move to the utilization of national systems. The core of the concept is the design of a framework for cash disbursement, constituting a shift from control-based to risk-based financial management. Based on the results of thorough risk assessments, the cash transfer to implementing partners is accompanied by different assurance activities that are adjusted to their level of risk and capacity.

197. The HACT concept introduced process steps that are highly interdependent and require full

implementation to successfully move to a risk-based financial management system. More than five years of HACT implementation at the country level has shown that the concept has a level of complexity that severely challenges the capacity of the UN and its implementing partners. The analysis revealed that many country teams decide not to implement HACT for a variety of reasons. It is noteworthy that there are no formalized criteria to determine the conditions under which HACT is not applicable. Many governments have not followed the argument that HACT would lead to a higher degree of national ownership and a reduction of transaction costs. The full disclosure of financial information and organizational capacities is often perceived as an intervention which is beyond the acceptable level of financial controls. This is particularly the case for countries that are subject to third party cost sharing and transferring their own funds to the UN for programme implementation.

198. Although a large number of countries have started to implement HACT, there was no example

found where a UNCT has successfully adopted a risk-based financial management approach by implementing all elements of HACT. Most country offices arrived to a compromise that includes carrying out the macro and micro assessments and the utilization of the FACE form. However, many practitioners continue to request invoices or maintain other means of financial controls in the absence of the effective implementation of regular and institutionalized assurance activities. While the capacity assessments and the utilization of the FACE form are important elements, they are the basis for assurance and HACT audits which are critical elements to replace a control-based financial management system and provide some degree of capacity development. Apart from the need to develop guidelines for assurance that are acceptable to internal auditors, the UN in most programme countries does not seem to have the capacity to provide regular assurance through on-site reviews and audits. Covering the high number of government and non-government implementing partners which are often located in remote areas is extremely costly and exceeds the financial and staff capacity of most UN agencies at the country level.

199. The fact that only a few programme countries have a notable number of common implementing

partners reduces the probability that a close inter-agency coordination and harmonization of HACT-


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relevant activities results in a significant reduction of transaction costs. Due to the complexity of HACT and the significant limitations, caused by agency-specific financial practices and procedures, the harmonization of HACT-relevant business practices is extremely challenging. This is not the case in other areas where inter-agency coordination has led to a successful harmonization of business practices at the country level. This includes joint efforts in harmonizing procurement practices and the implementation of common services for many business areas. The reason for this is that agency-specific policies and procedures for these areas allow for a larger bandwidth of changes, without involving headquarter units to initiate policy changes or underlying regulations and rules. In addition and more importantly, successful inter-agency coordination at the country level is driven by the incentive of each individual agency to achieve timely and sustainable efficiency gains or quantifiable transaction cost savings. Although the HACT concept aims to reduce transaction costs at the UN and implementing partner level, there is no evidence that this has been be achieved. The experience with the implementation of HACT has shown that there are severe differences between the theoretical assumptions of the HACT concept and its general applicability at the country level.

200. However, some practitioners have stated that the HACT implementation in their country has led to

improvements in terms of cash disbursement procedures and inter-agency coordination. They confirmed that this seems to be the case in countries where the government is genuinely interested in the capacity assessments as an opportunity for capacity development and where specific other conditions are met. These include a manageable number and a high ratio of common implementing partners and a relatively high level of existing financial management capacity at government and non-government entities. Following this, the feasibility of introducing a risk-based financial management system is dependent on country-specific circumstances. In many programme countries, the implementation of HACT does not seem to be feasible because of the staff capacity needs and financial requirements to perform assurance activities that would fully replace the control-based financial management instruments. However, concepts that require such rigorous changes of business practices for implementing partners have to show evidence of timely and considerable benefits. As this has not been the case, the experience has shown that there is little demand for the HACT concept on the government side. While the frequent parallel application of HACT-related capacity assessments and control-based financial management instruments has significantly reduced financial risks for UN agencies, it certainly has undermined the HACT objective to increasingly utilize national systems. Where HACT can only be implemented in part, it should not be implemented.

201. In conclusion, the findings of this assessment have shown that the implementation of HACT is

accompanied by a number of significant challenges that question the feasibility of the HACT concept for many countries. Therefore, the implementation of HACT is feasible in countries where the government expresses a genuine interest in conducting HACT capacity assessments and assurance activities in lieu of control-based financial management mechanisms. This requires the full implementation of HACT, ensuring the provision of sufficient staff and financial capacity. In many cases, the HACT implementation at the country level has introduced an additional layer of coordination without the necessary incentive for individual agencies to drive the harmonization of related business practices. This includes the specialized agencies which have started to carefully participate by testing the


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application in a few pilot countries. To successfully address the existing challenges, agencies and inter-agency bodies at headquarter level will have to ensure their commitment to develop UNDG approved guidelines that clarify the applicability of HACT at the country level. The guidelines will need to provide a level of standardization that will establish appropriate assurance activities and clarify the distribution of roles and responsibilities in the process. As harmonization of business practices is not an end in itself, it should be carefully reviewed whether the necessary investments would be met by an equal amount of measurable efficiency gains for the UN and implementing partners at the country level.


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Annex I: Recommendations

1. In accordance with the findings of this assessment, the UNDG should review the overall feasibility of

HACT in light of the significant commitment and investment required to enable its full implementation at the country level. Following the absence of a cause-and-effect relationship between the HACT concept and considerable benefits for the UN and implementing partners, it should be addressed whether the high investment will be met by the necessary support at all levels in the system.

2. To arrive to an informed decision about the feasibility of HACT, the UNDG should initiate an assessment

of HACT-related transaction costs at the UN and implementing partner level. While HACT might be feasible for individual agencies, the comparative analysis would aim to clarify whether the complexity and cost of coordination at headquarter, regional and country level would justify a full harmonization of HACT.

3. The UNDG should develop and endorse a set of criteria that determine the applicability of HACT for

programme countries. This would facilitate a guided decision making process for countries in communication with the Regional UNDG Teams and clarify the feasibility of HACT in light of country-specific circumstances. Unambiguous criteria would generate commitment for a full implementation where HACT is feasible and allow for a different focus in line with existing comparative advantages where it is not.

4. The capacity development objective of HACT should be reviewed and clarified. There is no direct causal

relationship between the implementation of HACT and the development of financial management capacity at the implementing partner level. However, HACT instruments provide valuable information about capacity gaps that qualify to support programmatic initiatives systematically developing capacity in related areas.

5. The UNDG should develop and approve specific guidelines for the implementation of HACT-related

assurance at the country level. Enriched by standard operating procedures for on-site reviews and HACT audits, the guidelines should ensure that assurance activities will replace the requirement for project-based audits and any other control-based mechanisms. It is imperative that internal audit departments of HACT implementing agencies participate in the development of such guidelines as they will have to meet the minimum audit requirements for the full implementation of a risk-based financial management approach.

6. The UNDG should develop and implement an accountability framework that clarifies the distribution of HACT-related roles and responsibilities at headquarter, regional, and country level for agencies and inter-agency bodies. The findings have shown that the complexity of coordinating and managing HACT has introduced major challenges generating bottlenecks and delays in the implementation process. The


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framework should aim to simplify coordination, shorten communication ways and take into account existing capacities.

7. To ensure the required leadership at the country level, the UNDG should define the specific roles and responsibilities of the Resident Coordinator in the HACT implementation process. This includes the responsibilities of the HACT focal point at the RCO, which should shift from an administrative support function towards a technical advisory role with regard to UNDG policies, improved quality control, coordination of the HACT implementation, and management of a HACT database.

8. The UNDG and individual agencies should review the current criteria for HACT compliance. The criteria

do not indicate whether progress has been made in the HACT implementation and stand for a process rather than results orientation. It is recommended to replace the HACT compliance designation with a UNDG approved set of results-oriented indicators that allow to measure progress in the implementation process. Accordingly, UN DOCO should revise the requested data for the global annual update.

9. UN DOCO should develop and implement a web-based database to support regional and country-level

focal points and monitor global HACT progress. The analysis of the global annual updates has shown that the provided information is insufficient and often contradicting. While the effort to generate the update is significant, the data is not validated or analyzed to support informed decisions at the UNDG level. The implementation of a web-based HACT database that will be used by HACT focal points at the country level will allow countries to better manage and coordinate the implementation of HACT. In addition, it will enable other inter-agency bodies at the regional and headquarter level to better support country-level focal points and monitor the implementation at any time during the year.

10. The UNDG HACT Advisory Committee should facilitate an amendment of the HACT framework to define

the implementing partner designation. As capacity assessments are the basis for cash disbursement and assurance activities, it is recommended that the implementing partner should be equivalent to the entity reporting on the utilization of funds as per its AWP and through the FACE form.

11. The UNDG HACT Advisory Committee should facilitate an amendment of the HACT framework to

further clarify the financial thresholds for micro assessments and HACT audits. The definition of financial thresholds severely impacts the performance of HACT-related assurance activities. It is recommended not to permit an increase of the current financial thresholds.

12. The UNDG HACT Advisory Committee should review the current periodicity of disbursement as per the

HACT framework. The experience in some countries has shown that a three months period can lead to a negative impact in terms of programme efficiency. It is recommended that the HACT framework is amended to determine the possibility of longer disbursement and reporting periods for ‘low risk’ implementing partners. To account for delays in cash transfer, the period should be adjusted to the actual disbursement date.


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13. The UNDG HACT Advisory Committee should facilitate an amendment of the HACT framework to further standardize the utilization of the FACE form as the exclusive instrument to manage cash disbursement and reporting. The HACT framework should stipulate that amendments to the FACE form contradict the risk-based financial management approach. In particular, the introduction of annexes and frequent collection of invoices alongside the FACE form should be addressed. In addition to the HACT framework, the relevance of the FACE form and its management at the country level should be highlighted in the guidance from UN DOCO and the Regional UNDG Teams.

14. The UNDG HACT Advisory Committee should review all agency-specific requirements that are not in line

with the HACT framework. With the aim to align all HACT instruments as much as possible with national financial management systems, agency-specific requirements outside of the HACT process steps should not be applied. This includes the use of quarterly work plans and the integration of agency-specific account codes. The approved AWP along with its detailed budget should be strengthened as the only planning tool.

15. The UNDG HACT Advisory Committee should facilitate the development of guidelines for the joint

assurance and audit plans. The findings have shown that that the development of joint assurance and audit plans at the country level is often delayed due to the coordination requirements and agency-specific differences. To avoid a negative impact on the assurance activities, the guidelines would aim to facilitate a timely implementation of a joint assurance and audit plan and clarify the scope of necessary harmonization between the agencies.

16. The UNDG HACT Advisory Committee should facilitate the development of a training package for the

country level that would target UN staff in programme and operations with the aim to effectively linking programming with financial management. Apart from the technical aspects of the HACT implementation, the training package should concentrate on shifting from a process orientation to a results-based implementation of HACT, the distribution of roles and responsibilities in the implementation process and the differences between a control-based and risk-based financial management approach.


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Annex II: Global Survey

Objective and Methodology 202. The global survey was designed based on the preliminary findings of this assessment aiming to

verify the desk review findings and providing additional information from a large number of programme countries. In detail, the survey targeted all progamme countries independent from their HACT implementation status and was designed for UN staff at all levels who are familiar with HACT and representatives of implementing partners. The questionnaire for implementing partners was designed to receive information about the impact of HACT on the capacity development of governmental and non-governmental entities. Therefore, the web-based survey consisted of two specific questionnaires, one for UN practitioners and one for implementing partner staff.

203. To ensure the best possible analysis of the provided information, the chosen methodology allows

the collection of standardized information about HACT implementation and stakeholders’ perceptions through a structured questionnaire that includes different question types, such as multiple choice, matrix of choices and rating scales. At the end of each section, respondents had the opportunity to place individual comments without any word limitation. The survey consists of 56 questions, eleven for Implementing Partners and 45 for UN practitioners. The questions were designed to enable all respondents to complete the survey without the need to provide additional data or engaging in any form of research. The reason for this is to ensure a high rate of return and that UN practitioners and implementing partners perceive the survey as value added and a good opportunity to provide quick, yet elaborative and precise feedback. The combination of questions and their design aim to reach a high degree of validity and accuracy.

204. To achieve utmost accuracy in the analysis of the survey, most questions have been designed to

allow the respondent to answer on a rating scale, which provides a relatively high accuracy in capturing information about complex subjects. The questions for implementing partners correspond to the impact of HACT rather than its operationalization. While the questionnaire for implementing partners consists of few questions on a relatively high level, it corresponds to possibly limited availability of concrete information at the implementing partners’ level.

205. The survey does not include questions on perceptions of workload or transaction costs related to

the implementation of HACT. This is intentional as a few questions on workload distribution and transaction costs would not provide validated information. Perceptions in this area are easily misleading as a perceived increase in workload in one area might have led to decreased workload in another. In addition, the concept of transaction costs would need to be clarified in order to allow respondents to accurately provide answers.


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206. To best capture the relevant areas for this assessment, the survey for UN practitioners is structured as per the following categories:

a. Introduction b. HACT Implementation c. Macro Assessment d. Micro Assessment e. Face Form f. Assurance g. Capacity Building h. Governance and Coordination

207. The survey was launched to all country offices on 30 September 2011 with an initial deadline of 9

October, which was extended to 20 October 2011 to allow for a higher number of responses. Within this timeframe, 544 respondents from 114 countries accessed the survey, most of which completed the majority of sections. In sum, a total of 332 respondents completed the survey, corresponding to a completion rate of 61%. Following this, questions throughout the survey show a decreasing number of respondents.

208. From the 544 respondents who accessed survey, 108 respondents from 13 different countries

identified themselves as implementing partners. The implementing partner questionnaire was completed by a total of 59 respondents, corresponding to a rate of 17.7% of all completed questionnaires. From 436 UN staff members who accessed the survey, 273 completed all sections of the questionnaire, corresponding to a completion rate of 62%.


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Section One: Introduction Question 1: In which country/location do you work?

continued on next page…

No. Answer OptionsResponse Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

1 Afghanis tan 0.4% 2 0.2% 1 0.0% 0 0.0% 0 14.3% 1

2 Albania 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

3 Algeria 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

4 Angola 1.7% 9 2.1% 9 0.0% 0 0.0% 0 0.0% 0

5 Argentina 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

6 Armenia 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

7 Austria (Vienna HQ) 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

8 Azerbai jan 1.1% 6 1.4% 6 0.0% 0 0.0% 0 0.0% 0

9 Bahra in 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

10 Bangladesh 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

11 Barbados&OECS 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

12 Belarus 1.1% 6 1.4% 6 0.0% 0 0.0% 0 0.0% 0

13 Bel ize 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

14 Benin 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

15 Bhutan 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

16 Bol ivia 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

17 Bosnia&Herzegovina 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

18 Botswana 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

19 Brazi l 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

20 Bulgaria 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

21 Burkina Faso 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

22 Burundi 9.2% 50 1.6% 7 18.6% 13 83.9% 26 57.1% 4

23 Cambodia 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

24 Cameroon 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

25 Cape Verde 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

26 Centra l African Republ ic 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

27 Chad 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

28 Chi le 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

29 China 0.6% 3 0.5% 2 1.4% 1 0.0% 0 0.0% 0

30 Colombia 2.4% 13 1.8% 8 4.3% 3 6.5% 2 0.0% 0

31 Comoros 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

32 Congo (DRC) 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

33 Congo (PRC) 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

34 Cook Is lands 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

35 Costa Rica 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

36 Cote d'Ivoi re 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

37 Cuba 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

38 Djibouti 1.1% 6 1.4% 6 0.0% 0 0.0% 0 0.0% 0

39 Dominican Republ ic 1.5% 8 1.8% 8 0.0% 0 0.0% 0 0.0% 0

40 DPR Korea 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

41 Ecuador 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

42 Egypt 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

43 El Sa lvador 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

44 Equatoria l Guinea 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

45 Eri trea 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

46 Ethiopia 1.5% 8 0.7% 3 5.7% 4 0.0% 0 14.3% 1

47 Fi ji 1.3% 7 1.6% 7 0.0% 0 0.0% 0 0.0% 0

48 Federated States of Micrones ia 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

49 Gabon 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

50 Gambia 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

51 Georgia 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

52 Ghana 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

53 Guatemala 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

54 Guinea 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

55 Guinea-Bissau 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

56 Guyana 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

57 Haiti 1.5% 8 1.8% 8 0.0% 0 0.0% 0 0.0% 0

58 Honduras 0.6% 3 0.5% 2 0.0% 0 0.0% 0 14.3% 1

59 India 1.3% 7 1.6% 7 0.0% 0 0.0% 0 0.0% 0

60 Indones ia 1.1% 6 1.4% 6 0.0% 0 0.0% 0 0.0% 0

List of Countries Total Responses United Nations Government NGO Profit-oriented Firm


77 | P a g e

continued on next page…


Response Count

Response Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

61 Iran 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

62 Iraq 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

63 Ita ly (Rome HQ) 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

64 Ita ly (Turin) 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

65 Jamaica 0.6% 3 0.2% 1 2.9% 2 0.0% 0 0.0% 0

66 Jordan 1.1% 6 1.4% 6 0.0% 0 0.0% 0 0.0% 0

67 Kazakhstan 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

68 Kenya 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

69 Kiribati 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

70 Kosovo 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

71 Kuwait 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

72 Kyrgyzstan 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

73 Lao PDR 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

74 Latvia 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

75 Lebanon 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

76 Lesotho 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

77 Liberia 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

78 Libya 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

79 Li thuania 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

80 Macedonia 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

81 Madagascar 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

82 Malawi 2.6% 14 2.8% 12 2.9% 2 0.0% 0 0.0% 0

83 Malays ia 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

84 Maldives 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

85 Mal i 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

86 Mauri tania 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

87 Mauri tius 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

88 Mexico 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

89 Moldova 1.1% 6 1.1% 5 1.4% 1 0.0% 0 0.0% 0

90 Mongol ia 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

91 Montenegro 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

92 Morocco 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

93 Mozambique 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

94 Myanmar 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

95 Namibia 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

96 Nauru 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

97 Nepal 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

98 Nicaragua 1.8% 10 2.3% 10 0.0% 0 0.0% 0 0.0% 0

99 Niger 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

100 Nigeria 1.5% 8 1.8% 8 0.0% 0 0.0% 0 0.0% 0

101 Niue 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

102 Occupied Pa lestinian Terri tories (OPT) 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

103 Pakis tan 1.5% 8 1.8% 8 0.0% 0 0.0% 0 0.0% 0

104 Palau 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

105 Panama 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

106 Papua New Guinea 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

107 Paraguay 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

108 Peru 1.5% 8 1.8% 8 0.0% 0 0.0% 0 0.0% 0

109 Phi l ippines 0.9% 5 0.7% 3 1.4% 1 3.2% 1 0.0% 0

110 Poland 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

111 Rebubl ic of Marshal l Is lands 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

112 Romania 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

113 Russ ia 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

114 Rwanda 1.8% 10 2.3% 10 0.0% 0 0.0% 0 0.0% 0

115 Samoa 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

116 Sao Tome & Principe 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

117 Saudi Arabia 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

118 Senegal 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

119 Serbia 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

120 Seychel les 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

121 Sierra Leone 1.3% 7 1.6% 7 0.0% 0 0.0% 0 0.0% 0

122 Solomon Is lands 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

Total Responses United Nations Government NGO Profit-oriented FirmList of Countries


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Question 2: For which entity do you work?


Response Count

Response Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

Response Percent

Response Count

123 Somal ia 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

124 South Africa 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

125 South Sudan 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

126 Sri Lanka 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

127 Sudan 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

128 Suriname 0.7% 4 0.7% 3 1.4% 1 0.0% 0 0.0% 0

129 Swazi land 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

130 Switzerland (Geneva HQ) 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

131 Syria 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

132 Tajikis tan 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

133 Tanzania 9.7% 53 2.5% 11 57.1% 40 6.5% 2 0.0% 0

134 Thai land 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

135 Timor Leste 1.3% 7 1.6% 7 0.0% 0 0.0% 0 0.0% 0

136 Togo 0.9% 5 1.1% 5 0.0% 0 0.0% 0 0.0% 0

137 Tokelau 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

138 Tonga 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

139 Trinidad & Tobago 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

140 Tunis ia 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

141 Turkey 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

142 Turkmenis tan 0.6% 3 0.7% 3 0.0% 0 0.0% 0 0.0% 0

143 Tuvalu 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

144 UAE 1.3% 7 1.6% 7 0.0% 0 0.0% 0 0.0% 0

145 Uganda 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

146 Ukra ine 1.1% 6 1.4% 6 0.0% 0 0.0% 0 0.0% 0

147 Uruguay 0.2% 1 0.2% 1 0.0% 0 0.0% 0 0.0% 0

148 USA (New York HQ) 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

149 Uzbekis tan 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

150 Vanuatu 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

151 Venezuela 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0

152 Vietnam 1.5% 8 1.8% 8 0.0% 0 0.0% 0 0.0% 0

153 Yemen 0.7% 4 0.9% 4 0.0% 0 0.0% 0 0.0% 0

154 Zambia 0.4% 2 0.5% 2 0.0% 0 0.0% 0 0.0% 0

155 Zimbabwe 1.7% 9 1.6% 7 2.9% 2 0.0% 0 0.0% 0

anwered question 544 436 70 31 7

skipped question 0 0 0 0 0

Total Responses United Nations Government NGO Profit-oriented FirmList of Countries

Answer Options Response Percent Response Count

United Nations 80.1% 436

Government 12.9% 70

Non-governmental Organization (NGO) 5.7% 31

Profit-oriented Organization 1.3% 7

544

0skipped question

answered question


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Questionnaire for Implementing Partners Section Two: Implementing Partners Question 3: How many years of experience do you have in dealing with the United Nations?

Question 4: Based on your work with the United Nations, did you experience any changes in the financial management capacity in your department/organization during the past three years? Please answer along the following scale:


less than one 16.9% 10

1 - 3 42.4% 25

4 - 6 16.9% 10

more than s ix 23.7% 14

59485skipped question

answered question

16.9%

42.4%

16.9%

23.7%

less than one

1 - 3

4 - 6

more than six

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0%

Answer Options

significant decrease of

capacity

some decrease of capacity

no changessome increase of

cpacity

significant increase of

capacityDon't know Rating Average Response Count

Scale 6 2 7 25 12 7 3.67 59

59

485

answered question

skipped question

10.2%

3.4%

11.9%

42.4%

20.3%

11.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0%

significant decrease of capacity

some decrease of capacity

no changes

some increase of cpacity

significant increase of capacity

Don't know


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Question 5: During the past three years, did you experience any changes in the timeliness of cash transfers to your organization/department? Please answer along the following scale:

Question 6: Based on your work with the UN on matters of financial management, did you experience any changes in terms of communication with individual UN agencies during the past three years? Please answer along the following scale:

Answer Options

a lot less timely less timely no changes more timely a lot more timely Don't know Rating Average Response Count

Scale 6 8 10 27 2 6 3.21 59

59

485

answered question

skipped question

10.2%

13.6%

16.9%

45.8%

3.4%

10.2%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

a lot less timely

less timely

no changes

more timely

a lot more timely

Don't know

Answer Options

a lot less communication

less communication

no changesmore

communicationa lot more

communicationDon't know Rating Average Response Count

Scale 4 6 5 34 3 7 3.50 59

59

485

answered question

skipped question

6.8%

10.2%

8.5%

57.6%

5.1%

11.9%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

a lot less communication

less communication

no changes

more communication

a lot more communication

Don't know


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Question 7: Based on your work with the UN on matters of financial management, did you experience any changes in terms of reporting of financial expenditures to UN agencies during the past three years? Please answer along the following scale:

Question 8: On matters of financial management, what changes did you experience in terms of UN agency coordination during the past three years? Please answer along the following scale:

Answer Options

a lot less less no changes more a lot more Don't know Rating Average Response Count

Frequency of reporting

4 4 10 27 8 6 3.58 59

Complexity of reporting

7 12 10 18 5 7 3.04 59

59

485skipped question

answered question

6.8%

6.8%

16.9%

45.8%

13.6%

10.2%

11.9%

20.3%

16.9%

30.5%

8.5%

11.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

a lot less

less

no changes

more

a lot more

Don't know

Complexity of reporting Frequency of reporting

Answer Options

a lot less coordination

less coordination no changesmore

coordinationa lot more

coordinationDon't know Rating Average Response Count

Scale 4 5 7 33 5 5 3.56 59

59

485

answered question

skipped question

6.8%

8.5%

11.9%

55.9%

8.5%

8.5%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

a lot less coordination

less coordination

no changes

more coordination

a lot more coordination

Don't know


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Question 9: Based on your work with the UN during the past three years, did you experience any changes in government ownership of planning processes? Please answer along the following scale:

Question 10: Based on your work with the UN during the past three years, did you experience any changes of government ownership in programme implementation processes? Please answer along the following scale:

Answer Options

a lot less government ownership

less government ownership

no changesmore

government ownership

a lot more government ownership

Don't know Rating AverageResponse

Count

Scale 5 3 13 23 9 6 3.53 59

59485

answered questionskipped question

8.5%

5.1%

22.0%

39.0%

15.3%

10.2%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0%



no changes

more government ownership


Don't know

Answer Options



no changesmore government

ownership


Don't know Rating Average Response Count

Scale 5 4 12 21 11 6 3.55 59

59

485

answered question

skipped question

8.5%

6.8%

20.3%

35.6%

18.6%

10.2%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%



no changes

more government ownership


Don't know


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Questionnaire for UN Staff Members Section Three: HACT Implementation Question 12: For which agency/office do you work? (Please select RCO if you work in the Office of the Resident Coordinator.)

Answer Options

Response Percent Response Count

ECA 0.3% 1

ECLAC 0.3% 1

FAO 1.8% 6

RCO 14.0% 46

UNICEF 31.9% 105

UNDP 17.0% 56

UNESCO 1.5% 5

UNIDO 0.3% 1

UNOPS 0.3% 1

UNFPA 28.0% 92

WFP 3.0% 10

WHO 0.9% 3

Other 0.6% 2

329

215

answered question

skipped question

0.3%

0.3%

1.8%

14.0%

31.9%

17.0%

1.5%

0.3%

0.3%

28.0%

3.0%

0.9%

0.6%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

ECAECLAC

FAORCO

UNICEFUNDP

UNESCOUNIDOUNOPSUNFPA

WFPWHOOther


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Question 13: Are you HACT focal point for your agency/office?

Question 14: In which functional area do you work?

Answer Options


Yes 65.0% 214

No 31.0% 102

Don't know 4.0% 13

329

215skipped question

answered question65%

31%

4%

Yes

No

Don't know


Administration 4.9% 16

Finance 15.2% 50

General Management 5.2% 17

Human Resources 0.3% 1

ICT 0.0% 0

Logistics 0.3% 1

M&E 3.3% 11

Operations Management 28.6% 94

Procurement 0.0% 0

Programme Management 24.6% 81

Project Management 2.1% 7

UN Coordination 12.8% 42

Other 2.7% 9

329

215skipped question

answered question

4.9%

15.2%

5.2%

0.3%

0.0%

0.3%

3.3%

28.6%

0.0%

24.6%

2.1%

12.8%

2.7%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

AdministrationFinance

General ManagementHuman Resources

ICTLogistics

M&EOperations Management

ProcurementProgramme Management

Project ManagementUN Coordination

Other


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Question 15: In your opinion, what are the minimum requirements for a programme country to be fully HACT compliant? Please select all that applies.

Question 16: Is your country HACT compliant?


Government agreement through CPAP or other documents 84.8% 279

Completed macro assessment for the current programme cycle 83.9% 276

Completed micro assessments for all implementing partners 66.3% 218

Either completed micro assessments or assumed high risk for all implementing partners 54.1% 178

Completed assurance and audit plan for all participating agencies 74.8% 246

Implemented FACE form with all implementing partners 78.1% 257

Replaced all project or other audits with HACT audits 35.3% 116

If resident, implementation through at least one former excom agency (UNDP, UNFPA, UNICEF, WFP) 15.5% 51

If resident, implementation through at least two former excom agencies (UNDP, UNFPA, UNICEF, WFP) 8.5% 28

If resident, implementation through at least three former excom agencies (UNDP, UNFPA, UNICEF, WFP) 12.2% 40

If resident, implementation through all four former excom agencies (UNDP, UNFPA, UNICEF, WFP) 33.1% 109

Other (please specify) 8.5% 28

329

215skipped question

answered question

84.8%

83.9%

66.3%

54.1%

74.8%

78.1%

35.3%

15.5%

8.5%

12.2%

33.1%

8.5%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

Government agreement through CPAP or other documents

Completed macro assessment for the current programme cycle

Completed micro assessments for all implementing partners

Either completed micro assessments or assumed high risk for all …

Completed assurance and audit plan for all participating agencies

Implemented FACE form with all implementing partners

Replaced all project or other audits with HACT audits

If resident, implementation through at least one former excom …

If resident, implementation through at least two former excom …

If resident, implementation through at least three former excom …

If resident, implementation through all four former excom …

Other (please specify)

Answer Options


Yes 40.4% 133

No 51.7% 170

Don't know 7.9% 26

329

215skipped question

answered question

40.4%

51.7%

7.9%

Yes

No

Don't know


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Question 17: In your opinion, do you need clearer guidance on how to operationally implement HACT?

Question 18: If you answered yes to the previous question, which are the areas where you need clearer guidance on how this could be best supported? Please check all that applies.

Answer Options


Yes 40.4% 133

No 51.7% 170

Don't know 7.9% 26

329

215skipped question

answered question 72.3%

25.2%

2.4%

Yes

No

Don't know

Answer Optionsmore specific

guidelinesstandard operating

proceduresonline training

face-to-face training/

workshopshelpdesk

technical on-site support

practice networks Response Count

Macro assessment 76 91 50 66 33 31 55 178

Micro assessment 86 108 62 77 47 41 64 213

Assurance activities 113 137 79 101 63 47 66 249

FACE form 66 89 68 72 46 38 62 193

UN agency coordination 143 111 48 82 45 41 64 242

Other (please specify) 54

329

215skipped question

answered question

23.1%

26.1%

34.3%

20.1%

43.5%

27.7%

32.8%

41.6%

27.1%

33.7%

15.2%

18.8%

24.0%

20.7%

14.6%

20.1%

23.4%

30.7%

21.9%

24.9%

10.0%

14.3%

19.1%

14.0% 13.7%

9.4%

12.5%14.3%

11.6%12.5%

16.7%

19.5% 20.1%18.8% 19.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

Macro assessment Micro assessment Assurance activities FACE form UN agency coordination

more specific guidelines standard operating procedures online training face-to-face training/ workshops

helpdesk technical on-site support practice networks


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Question 19: In your opinion, to what extent would a higher degree of standardized operating procedures support the implementation of HACT? Please answer along the following scale:

Answer Options

(Not at all) 1 2 3 4 5 (Fully) Don't know Rating Average Response Count

Scale 12 19 55 112 104 27 3.92 329

329

215

answered question

skipped question

3.6%

5.8%

16.7%

34.0%

31.6%

8.2%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


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Section Four: Macro Assessment Question 21: In your opinion, are the findings of the current macro assessment integrated into the UNDAF? Please answer along the following scale:

Question 22: In your opinion, are the findings of the current macro assessment integrated into the HACT implementation plan/work plan? Please answer along the following scale:

Answer Options


Scale 67 50 57 45 15 88 2.53 322

322

222

answered question

skipped question

20.8%

15.5%

17.7%

14.0%

4.7%

27.3%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know

Answer Options


Scale 62 40 64 63 31 62 2.85 322

322

222

answered question

skipped question

19.3%

12.4%

19.9%

19.6%

9.6%

19.3%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


89 | P a g e

Section 5: Micro Assessment Question 24: In your opinion, are you satisfied with the quality of micro assessments conducted for your Implementing Partners? Please answer along the following scale:

Question 25: From your experience, what are the main challenges when conducting micro assessments? Please check all that applies:

Answer Options


Scale 18 31 78 84 37 50 3.37 298

298

246

answered question

skipped question

6.0%

10.4%

26.2%

28.2%

12.4%

16.8%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


There are no challenges 3.7% 11

Contracting the audit/consulting firm 26.2% 78

Capacity of the audit/consulting firm 32.2% 96

Quality of the micro assessments 47.0% 140

Contradicting risk ratings 32.2% 96

Managing the amount of micro assessments 35.6% 106

Inter-agency coordination 63.4% 189


298

246skipped question

answered question


90 | P a g e

Question 26: In your opinion, what should be the minimum financial threshold for conducting micro assessments? (Annual disbursements of all agencies combined to Implementing Partners in US$.)

3.7%

26.2%

32.2%

47.0%

32.2%

35.6%

63.4%

29.5%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

There are no challenges

Contracting the audit/consulting firm

Capacity of the audit/consulting firm

Quality of the micro assessments

Contradicting risk ratings

Managing the amount of micro assessments

Inter-agency coordination


Answer Options


below 50,000 7.4% 22

50,000 11.4% 34

100,000 46.0% 137

200,000 9.4% 28

300,000 7.0% 21

400,000 1.7% 5

500,000 10.4% 31

above 500,000 6.7% 20

298

246skipped question

answered question

7.4%

11.4%

46.0%

9.4%

7.0%

1.7%

10.4%

6.7%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

below 50,000

50,000

100,000

200,000

300,000

400,000

500,000

above 500,000


91 | P a g e

Question 27: From your experience, to what extent do the micro assessments use the ‘Financial Management Questionnaire’ of the UNDG guidelines? Please answer along the following scale:

Question 28: From your experience, to what extent does the risk rating determine the cash transfer modality? Please answer along the following scale:

Answer Options


Scale 5 13 44 72 73 91 3.94 298

298

246

answered question

skipped question

1.7%

4.4%

14.8%

24.2%

24.5%

30.5%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know

Answer Options


Scale 33 34 60 63 69 39 3.39 298

298

246

answered question

skipped question

11.1%

11.4%

20.1%

21.1%

23.2%

13.1%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


92 | P a g e

Question 29: From your experience, to what extent does the risk rating determine the assurance activities? Please answer along the following scale:

Question 30: From your experience, to what extent does the risk rating determine any capacity building activities? Please answer along the following scale:

Answer Options


Scale 11 34 75 73 62 43 3.55 298

298

246

answered question

skipped question

3.7%

11.4%

25.2%

24.5%

20.8%

14.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know

Answer Options


Scale 25 51 72 69 44 37 3.21 298

298

246

answered question

skipped question

8.4%

17.1%

24.2%

23.2%

14.8%

12.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


93 | P a g e

Question 31: In your opinion, to what extent are micro assessments an effective tool to manage financial risk? Please answer along the following scale:

Answer Options


Scale 10 38 86 89 46 29 3.46 298

298

246

answered question

skipped question

3.4%

12.8%

28.9%

29.9%

15.4%

9.7%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


94 | P a g e

Section Six: FACE Form Question 33: From your experience, to what extent does the FACE form replace all other documents? Please answer along the following scale:

Question 34: In your opinion, to what extent is the FACE form an effective tool to manage disbursements and reporting of Implementing Partners? Please answer along the following scale:

Answer Options


Scale 14 19 62 76 104 23 3.86 298

298

246

answered question

skipped question

4.7%

6.4%

20.8%

25.5%

34.9%

7.7%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know

Answer Options


Scale 11 26 71 92 73 25 3.70 298

298

246

answered question

skipped question

3.7%

8.7%

23.8%

30.9%

24.5%

8.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


95 | P a g e

Section Seven: Assurance Question 36: In your office/country, is there an up-to-date assurance and audit plan guiding the assurance activities for Implementing Partners?

Question 37: From your experience, have onsite reviews changed the risk rating of an Implementing Partner?

Question 38: In your opinion, to what extent are onsite reviews an effective tool to manage financial risk? Please answer along the following scale:

Answer Options


Yes 46.6% 135

No 34.5% 100

Don't know 13.1% 38

N/A 5.9% 17

290

254skipped question

answered question

46.6%

34.5%

13.1%5.9%

Yes

No

Don't know

N/A

Answer Options


Yes 31.0% 90

No 37.6% 109

Don't know 31.4% 91

290

254skipped question

answered question

31.0%

37.6%

31.4%Yes

No

Don't know

Answer Options


Scale 7 25 64 92 50 52 3.64 290

290

254

answered question

skipped question

2.4%

8.6%

22.1%

31.7%

17.2%

17.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


96 | P a g e

Question 39: In your office/country, what audits are performed for Implementing Partners under HACT? Please check all that applies.

Question 40: In your opinion, to what extent can HACT audits, focusing on systems and controls, replace project related audits focusing on expenditure reviews? Please answer along the following scale:

Answer Options


Partner Audits 36.9% 107 Audits 36.9% 107 Audits 18.3% 53

N/A 26.6% 77 specify) 22.8% 66

290

254skipped question

answered question

36.9%

36.9%

18.3%

26.6%

22.8%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

Partner Audits

NGO/NIM Audits

Special Project Audits

N/A


Answer Options


Scale 22 36 63 86 31 52 3.29 290

290

254

answered question

skipped question

7.6%

12.4%

21.7%

29.7%

10.7%

17.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


97 | P a g e

Question 41: In your opinion, to what extent could independent government audits replace the requirement for HACT auditing? (Not performed by the internal audit group from the same ministry.) Please answer along the following scale:

Answer Options


Scale 50 56 51 47 22 64 2.71 290

290

254

answered question

skipped question

17.2%

19.3%

17.6%

16.2%

7.6%

22.1%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


98 | P a g e

Section Eight: Capacity Building Question 43: In your office/country, is there a training plan to strengthen the financial management capacity of Implementing Partners?

Question 44: From your experience, what are the major challenges when providing training to Implementing Partners? Please check all that applies.

Answer Options


Yes 43.9% 126

No 38.7% 111

Don't know 10.5% 30

N/A 7.0% 20

287

257skipped question

answered question

43.9%

38.7%

10.5%7.0%

Yes

No

Don't know

N/A


We do not provide training to implementing partners 16.7% 48

Amount of implementing partners 26.8% 77

Lack of standardized training material 46.3% 133

Lack of qualified training firms/consultants 23.3% 67

Lack of interest of implementing partner 36.6% 105

Cost of providing training 33.4% 96

Inter-agency Coordination 54.4% 156


287

257skipped question

answered question

16.7%

26.8%

46.3%

23.3%

36.6%

33.4%

54.4%

25.4%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

We do not provide training to implementing partners

Amount of implementing partners

Lack of standardized training material

Lack of qualified training firms/consultants

Lack of interest of implementing partner

Cost of providing training

Inter-agency Coordination



99 | P a g e

Question 45: From your experience, to what extent are trainings for Implementing Partners an effective tool to achieve risk ratings over time? Please answer along the following scale:

Question 46: In your office/country, is there a HACT training plan targeting United Nations staff?

Answer Options


Scale 6 19 67 97 67 31 3.78 287

287

257

answered question

skipped question

2.1%

6.6%

23.3%

33.8%

23.3%

10.8%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know

Answer Options


Yes 34.1% 98

No 47.0% 135

Don't know 14.3% 41

N/A 4.5% 13

287

257skipped question

answered question

34.1%

47.0%

14.3%4.5%

Yes

No

Don't know

N/A


100 | P a g e

Question 47: In your opinion, to what extent do you need more training on HACT? Please answer along the following scale:

Answer Options


Scale 15 36 51 82 94 9 3.73 287

287

257

answered question

skipped question

5.2%

12.5%

17.8%

28.6%

32.8%

3.1%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

4

5 (Fully)

Don't know


101 | P a g e

Section Nine: Governance and Coordination Question 49: In your country, is there an inter-agency HACT working group?

Question 50: If your previous answer was yes, to which body does the group directly report?

Answer Options


Yes 78.8% 215

No 16.1% 44

Don't know 4.4% 12

N/A 0.7% 2

273

271skipped question

answered question 78.8%

16.1%

4.4% 0.7%

Yes

No

Don't know

N/A

Answer Options


UNCT 31.1% 85

Operations

14.7% 40

Inter-agency

4.0% 11

Office of the

20.5% 56

Don't know 7.0% 19

N/A 15.4% 42

Other (please 7.3% 20

273

271

answered question

skipped question

31.1%

14.7%

4.0%

20.5%

7.0%

15.4%

7.3%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

UNCT

Operations Management Team (OMT)

Inter-agency Programme Working Group

Office of the Resident Coordinator (RCO)

Don't know

N/A



102 | P a g e

Question 51: If there is a HACT inter-agency working group in your country, how often does it approximately meet during one calendar year? Please answer along the following scale:

Question 52: In your country, is there a focal point for the inter-agency coordination of HACT?

Answer Options


Never 5.5% 15

1-3 times 21.2% 58

4-6 times 17.2% 47

7-9 times 11.7% 32

10-12 times 8.1% 22

more than 12 5.9% 16

Don't know 14.7% 40

N/A 15.8% 43

273

271skipped question

answered question

5.5%

21.2%

17.2%

11.7%

8.1%

5.9%

14.7%

15.8%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

Never

1-3 times

4-6 times

7-9 times

10-12 times

more than 12 times

Don't know

N/A


No 8.4% 23

Yes, in the RCO 37.7% 103

Yes, in a UN Agency 34.4% 94

Don't know 9.2% 25

N/A 4.4% 12


273

271skipped question

answered question


103 | P a g e

Question 53: In your country, to what extent are the following HACT activities jointly managed and implemented? Please answer along the following scale:

8.4%

37.7%

34.4%

9.2%

4.4%

5.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

No

Yes, in the RCO

Yes, in a UN Agency

Don't know

N/A


Answer Options (Not at all) 1 2 3 4 5 (Fully) Don't know Rating Average Response Count

Joint Micro Assessments 45 30 45 42 90 21 3.40 273

Joint Assurance and Audit Plan 99 32 44 26 32 40 2.40 273

Joint Spot Checks 142 32 31 19 13 36 1.86 273

Joint HACT Audits 139 27 26 21 19 41 1.94 273

Joint HACT Training for IPs 96 20 46 33 45 33 2.63 273

Joint HACT Training for UN Staff 88 38 40 33 43 31 2.61 273

Joint HACT Database 96 33 38 32 32 42 2.44 273

273

271

answered question

skipped question

16%

36%

52%51%

35%

32%

35%

11% 12%12%

10%

7%

14%12%

16% 16%

11%10%

17% 15%

14%15%

10%7%

8%

12% 12% 12%

33%

12%

5%7%

16% 16%12%

8%

15%13%

15%

12% 11%

15%

0%

10%

20%

30%

40%

50%

60%

Joint Micro Assessments

Joint Assurance and Audit Plan

Joint Spot Checks Joint HACT Audits Joint HACT Training for IPs

Joint HACT Training for UN

Staff

Joint HACT Database

(Not at all) 1 2 3 4 5 (Fully) Don't know


104 | P a g e

Question 54: In your opinion, to what extent did your office move from a control-based to a risk-based management culture?

Question 55: A good division of labor between UNCTs, their Regional UNDG Teams, UN DOCO and agency headquarters seems very important for a successful implementation of HACT. In your opinion, which of the following responsibilities should be held by which entity? Please check all that applies.

Answer Options

(Not at all) 1 2 3 3 (Fully) 5 Don't know Rating Average Response Count

Scale 26 48 91 59 18 31 2.98 273

273

271

answered question

skipped question

9.5%

17.6%

33.3%

21.6%

6.6%

11.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

(Not at all) 1

2

3

3

(Fully) 5

Don't know

Answer Options UNCTRegional UNDG

TeamUN DOCO Agency HQ Don't know Response Count

Technical support to UNCTs 36 155 115 70 24 267

Strategic guidance to UNCTs 25 138 135 65 24 266

Development of training packages 36 97 143 68 23 265

Provision of training to UN staff 118 104 87 73 22 266

Development of guidelines 42 75 163 79 22 265

Interpretation of guidelines 104 99 89 87 21 266

Provision of annual status update 147 71 62 45 25 262

Administration of HACT databases 168 57 49 41 28 265

Resolution of country specific issues 186 83 33 48 20 263

Decisions on HACT compliance 146 93 60 59 24 267

Decisions on HACT waivers 119 88 68 66 29 264

Monitoring of HACT implementation 177 108 84 76 20 266

6

273

271


skipped question

answered question


105 | P a g e

Graph Question 55:

13%

9%

13%

43%

15%

38%

54%

62%

68%

53%

44%

65%

57%

51%

36%

38%

27%

36%

26%

21%

30%

34%

32%

40%

42%

49%

52%

32%

60%

33%

23%

18%

12%

22%

25%

31%

26%

24%

25%

27%

29%

32%

16%

15%

18%

22%

24%

28%

9%

9%

8%

8%

8%

8%

9%

10%

7%

9%

11%

7%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Technical support to UNCTs

Strategic guidance to UNCTs

Development of training packages

Provision of training to UN staff

Development of guidelines

Interpretation of guidelines

Provision of annual status update

Administration of HACT databases

Resolution of country specific issues

Decisions on HACT compliance

Decisions on HACT waivers

Monitoring of HACT implementation

Don't know Agency HQ UN DOCO Regional UNDG Team UNCT


106 | P a g e

Annex III: Global Annual Updates 2008-2011 – Summary Table

Coun

try

No.

Regi

onCo

un

try

GN

I

Development Status

Crisis/Post-Conflict

Reported **

HACT not applicable

UNDG Deferral

UNCT postponed

Government Agreement

Macro Assessment/high risk

Micro Assessment/high risk


HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

1ES

AAn

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LMIC

LDC

XX

XX

XX

XX

2ES

ABo

tsw

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UM

ICX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

X3

ESA

Buru

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LIC

LDC

XX

XX

4ES

ACo

mor

osLI

CLD

CX

XX

XX

5ES

AEr

itre

aLI

CLD

CX

XX

XX

XX

XX

XX

XX

XX

X6

ESA

Ethi

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LIC

LDC

XX

XX

7ES

AKe

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LIC

XX

XX

XX

8ES

ALe

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XX

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XX

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10ES

AM

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CX

XX

XX

XX

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XX

XX

XX

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11ES

AM

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Moz

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LIC

LDC

XX

XX

XX

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XX

XX

XX

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Nam

ibia

UM

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XX

XX

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ESA

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CLD

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XX

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15ES

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16ES

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XX

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Swaz

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XX

XX

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LIC

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XX

XX

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XX

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20ES

AU

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XX

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X21

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LMIC

LDC

XX

XX

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22ES

AZi

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LIC

XX

XX

XX

XX

XX

X23

WCA

Beni

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XX

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XX

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24W

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XX

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WCA

Cam

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Cape

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ICLD

CX

XX

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27W

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LIC

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XX

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28W

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29W

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(DRC

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XX

XX

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30W

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(PRC

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31W

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XX

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33W

CAG

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WCA

Gam

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LIC

LDC

XX

XX

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35W

CAG

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LMIC

XX

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36W

CAG

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XX

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37W

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LIC

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XX

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LIC

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XX

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tes

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XX

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XX

XX

XX

X53

Arab

Sta

tes

Kuw

ait

HIC

XX

XX

XX

XX

54Ar

ab S

tate

sLe

bano

nU

MIC

XX

XX

XX

XX

XX

XX

X55

Arab

Sta

tes

Liby

aU

MIC

XX

XX

XX

Regi

on7-

Oct

-11

27-J

ul-1

030

-Apr

-09

30-S

ep-0

8St

atus


107 | P a g e

Coun

try

No.

Regi

onCo

un

try

GN

I

Development Status


Reported **

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

56Ar

ab S

tate

sM

oroc

co

LMIC

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

X57

Arab

Sta

tes

OPT

LMIC

XX

XX

X58

Arab

Sta

tes

Saud

i Ara

bia

HIC

XX

XX

X59

Arab

Sta

tes

Som

alia

LIC

LDC

XX

XX

XX

60Ar

ab S

tate

sSu

dan

LMIC

LDC

XX

XX

XX

61Ar

ab S

tate

sSy

ria

LMIC

XX

XX

XX

62Ar

ab S

tate

sTu

nisi

a LM

ICX

XX

XX

XX

XX

XX

XX

X63

Arab

Sta

tes

UAE

&Q

atar

HIC

XX

XX

X64

Arab

Sta

tes

Yem

enLM

ICLD

CX

XX

XX

XX

XX

XX

XX

XX

65As

ia&

Paci

ficAf

ghan

ista

nLI

CLD

CX

XX

XX

XX

XX

XX

XX

X66

Asia

&Pa

cific

Bang

lade

shLI

CLD

CX

XX

XX

XX

XX

XX

X67

Asia

&Pa

cific

Bhut

anLM

ICLD

CX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

X68

Asia

&Pa

cific

Cam

bodi

aLI

CLD

CX

XX

XX

XX

69As

ia&

Paci

ficCh

ina

UM

ICX

XX

XX

XX

XX

70As

ia&

Paci

ficD

PR K

orea

LIC

XX

71As

ia&

Paci

ficIn

dia

LMIC

XX

XX

XX

XX

XX

XX

72As

ia&

Paci

ficIn

done

sia

LMIC

XX

XX

XX

XX

XX

XX

XX

XX

XX

73As

ia&

Paci

ficIr

anU

MIC

XX

XX

74As

ia&

Paci

ficLa

o PD

RLM

ICLD

CX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

75As

ia&

Paci

ficM

alay

sia

UM

ICX

XX

XX

XX

XX

XX

XX

76As

ia&

Paci

ficM

aldi

ves

UM

ICX

XX

XX

XX

XX

XX

XX

XX

XX

XX

77As

ia&

Paci

ficM

ongo

lia

LMIC

XX

XX

XX

XX

X78

Asia

&Pa

cific

Mya

nmar

LI

CLD

CX

XX

XX

XX

79As

ia&

Paci

ficN

epal

LIC

LDC

XX

XX

XX

XX

XX

XX

XX

XX

80As

ia&

Paci

ficPa

kist

an

LM

ICX

XX

X81

Asia

&Pa

cific

Phili

ppin

esLM

ICX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

X82

Asia

&Pa

cific

Papu

a N

ew G

uine

aLM

ICX

XX

XX

XX

XX

XX

XX

XX

X83

Asia

&Pa

cific

Sam

oaLM

ICLD

CX

XX

XX

XX

XX

XX

XX

XX

XX

XX

84As

ia&

Paci

ficCo

ok Is

land

s X

XX

XX

Xno

t lis

ted

not l

iste

dno

t lis

ted

85As

ia&

Paci

ficN

iue

XX

XX

XX

not l

iste

dno

t lis

ted

not l

iste

d86

Asia

&Pa

cific

Toke

lau

XX

XX

XX

not l

iste

dno

t lis

ted

not l

iste

d87

Asia

&Pa

cific

Fiji

LMIC

XX

XX

XX

XX

XX

XX

XX

XX

XX

88As

ia&

Paci

ficFe

dera

ted

Stat

es o

f Mic

rone

sia

LMIC

XX

Xno

t lis

ted

not l

iste

dno

t lis

ted

89As

ia&

Paci

ficKi

riba

tiLM

ICLD

CX

XX

XX

Xno

t lis

ted

not l

iste

dno

t lis

ted

90As

ia&

Paci

ficRe

bubl

ic o

f Mar

shal

l isl

ands

LMIC

XX

Xno

t lis

ted

not l

iste

dno

t lis

ted

91As

ia&

Paci

ficN

auru

not l

iste

dno

t lis

ted

not l

iste

d92

Asia

&Pa

cific

Solo

mon

Isla

nds

LMIC

LDC

XX

XX

XX

not l

iste

dno

t lis

ted

not l

iste

d93

Asia

&Pa

cific

Pala

uU

MIC

XX

not l

iste

dno

t lis

ted

not l

iste

d94

Asia

&Pa

cific

Tong

aLM

ICX

XX

not l

iste

dno

t lis

ted

not l

iste

d95

Asia

&Pa

cific

Tuva

luLM

ICLD

CX

Xno

t lis

ted

not l

iste

dno

t lis

ted

96As

ia&

Paci

ficVa

nuat

uLM

ICLD

CX

XX

XX

Xno

t lis

ted

not l

iste

dno

t lis

ted

97As

ia&

Paci

ficSr

i Lan

ka

LMIC

XX

XX

XX

X98

Asia

&Pa

cific

Thai

land

LMIC

XX

XX

XX

XX

XX

XX

XX

XX

XX

99As

ia&

Paci

ficTi

mor

Les

teLM

ICLD

CX

XX

XX

X10

0As

ia&

Paci

ficVi

etna

mLM

ICX

XX

XX

XX

XX

XX

XX

XX

XX

X10

1Eu

rope

&CI

SAl

bani

aU

MIC

XX

XX

XX

X10

2Eu

rope

&CI

SAr

men

iaLM

ICX

XX

XX

XX

XX

XX

103

Euro

pe&

CIS

Azer

baija

nU

MIC

XX

XX

XX

XX

XX

104

Euro

pe&

CIS

Bela

rus

UM

ICX

XX

X10

5Eu

rope

&CI

SBo

snia

&H

erze

govi

naU

MIC

XX

XX

XX

XX

X10

6Eu

rope

&CI

SBu

lgar

iaU

MIC

X10

7Eu

rope

&CI

SG

eorg

iaLM

ICX

XX

XX

108

Euro

pe&

CIS

Kaza

khst

anU

MIC

XX

XX

XX

109

Euro

pe&

CIS

Koso

voLM

ICX

XX

XX

XX

XX

XX

XX

110

Euro

pe&

CIS

Kyrg

yzst

anLI

CX

XX

X

Regi

onSt

atus

7-O

ct-1

127

-Jul

-10

30-A

pr-0

930

-Sep

-08


108 | P a g e

Coun

try

No.

Regi

onCo

un

try

GN

I

Development Status


Reported **

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

Reported

HACT not applicable

UNDG Deferral

UNCT postponed





HACT Compliant

111

Euro

pe&

CIS

Latv

iaU

MIC

XX

X11

2Eu

rope

&CI

SLi

thua

nia

UM

ICX

XX

113

Euro

pe&

CIS

Mac

edon

iaU

MIC

XX

XX

114

Euro

pe&

CIS

Mol

dova

LMIC

XX

X11

5Eu

rope

&CI

SM

onte

negr

oU

MIC

XX

XX

XX

XX

XX

XX

116

Euro

pe&

CIS

Pola

nd

HIC

XX

117

Euro

pe&

CIS

Rom

ania

U

MIC

118

Euro

pe&

CIS

Russ

iaU

MIC

XX

119

Euro

pe&

CIS

Serb

iaU

MIC

XX

XX

XX

XX

XX

120

Euro

pe&

CIS

Tajik

ista

nLI

CX

XX

X12

1Eu

rope

&CI

STu

rkey

LMIC

XX

XX

XX

XX

122

Euro

pe&

CIS

Turk

men

ista

nLM

ICX

X12

3Eu

rope

&CI

SU

krai

neLM

ICX

XX

124

Euro

pe&

CIS

Uzb

ekis

tan

LMIC

XX

125

LAC

Arge

ntin

aU

MIC

XX

X12

6LA

CBa

rbad

os&

OEC

SH

ICX

XX

XX

XX

XX

X12

7LA

CBe

lize

LMIC

XX

XX

128

LAC

Boliv

iaLM

ICX

XX

XX

XX

XX

XX

XX

X12

9LA

CBr

azil

UM

ICX

XX

XX

XX

XX

130

LAC

Chile

UM

ICX

XX

XX

XX

XX

X13

1LA

CCo

lom

bia

UM

ICX

XX

XX

XX

XX

XX

XX

XX

XX

132

LAC

Cost

a Ri

ca

UM

ICX

XX

XX

XX

XX

XX

XX

XX

X13

3LA

CCu

baU

MIC

XX

XX

XX

X13

4LA

CD

omin

ican

Rep

ublic

UM

ICX

XX

XX

XX

XX

XX

XX

XX

X13

5LA

CEc

uado

rU

MIC

XX

XX

XX

XX

XX

XX

X13

6LA

CEl

Sal

vado

rLM

ICX

XX

XX

XX

XX

XX

XX

XX

X13

7LA

CG

uate

mal

aLM

ICX

XX

XX

XX

XX

XX

XX

XX

138

LAC

Guy

ana

LMIC

XX

XX

XX

XX

XX

139

LAC

Hai

tiLI

CLD

CX

XX

XX

X14

0LA

CH

ondu

ras

LMIC

XX

XX

XX

XX

XX

XX

141

LAC

Jam

aica

UM

ICX

XX

XX

XX

XX

XX

XX

XX

X14

2LA

CM

exic

oU

MIC

XX

XX

XX

XX

XX

143

LAC

Nic

arag

uaLM

ICX

XX

XX

XX

XX

XX

XX

XX

X14

4LA

CPa

nam

aU

MIC

XX

XX

XX

XX

X14

5LA

CPa

ragu

ayLM

ICX

XX

XX

XX

XX

XX

XX

XX

146

LAC

Peru

UM

ICX

XX

XX

XX

XX

XX

XX

X14

7LA

CSu

rina

me

LMIC

XX

XX

XX

XX

XX

X14

8LA

CTr

inid

ad &

Tob

ago

HIC

XX

XX

XX

XX

X14

9LA

CU

rugu

ayU

MIC

XX

XX

XX

XX

XX

XX

XX

XX

XX

150

LAC

Vene

zuel

aU

MIC

XX

XX

XX

XX

Com

men

ts:

* D

ata

from

pre

viou

s up

date

s ar

e no

t rol

led-

over

if th

e co

untr

y ha

s no

t rep

orte

d. R

epor

ting

on

ongo

ing

acti

viti

es a

re n

ot li

sted

.

** P

leas

e se

e co

mpl

ete

desc

ript

ion

of a

pplic

able

dat

a be

low

in a

ccor

danc

e w

ith

mat

chin

g co

lour

s.

Chec

ks a

ll Pr

ogra

mm

e Co

untr

ies

that

repo

rted

in th

e re

spec

tive

upd

ate.

The

re is

no

roll-

over

of p

revi

ousl

y re

port

ed d

ata.

Coun

trie

s w

here

HAC

T is

not

app

licab

le.

Coun

trie

s th

at re

ceiv

ed d

efer

ral f

rom

the

Regi

onal

UN

DG

Tea

m.

Coun

trie

s th

at p

ostp

oned

the

impl

emen

tati

on o

f HAC

T w

ith

UN

CT d

ecis

ion.

Agre

emen

t on

HAC

T Im

plem

enta

tion

wit

h th

e go

vern

men

t eit

her i

n CP

AP o

r thr

ough

exc

hang

e of

lett

ers.

Coun

trie

s co

mpl

eted

Mac

ro A

sses

smen

t or a

ssum

ed h

igh

risk

cat

egor

y fo

r the

cou

ntry

.

Coun

trie

s c

ompl

eted

Mic

ro A

sses

smen

ts fo

r all

part

ners

rece

ivin

g U

SD 1

00,0

00 c

olle

ctiv

ely

or h

igh

risk

cat

egor

y as

sum

ed, w

here

Mic

ro A

sses

smen

t cou

ld n

ot b

e co

mpl

eted

.

Coun

trie

s co

mpl

eted

Ass

uran

ce a

nd A

udit

Pla

n.

Coun

trie

s th

at re

port

ed to

be

fully

HAC

T co

mpl

iant

.

30-S

ep-0

8Re

gion

Stat

us7-

Oct

-11

27-J

ul-1

030

-Apr

-09


109 | P a g e

Annex IV: Global Annual Updates 2008-2011 – Trends Methodology

Basis for the trend analysis are the four global annual updates that have been carried out by UN DOCO since September 2008. The reported data has been summarized in the table of Annex III. Reporting rates to the global annual updates have varied significantly. In many cases, countries that reported to the global annual update in one year did not report in the following year. In light of these significant weaknesses of the updates, missing data from individual countries has been carried over from previous years for the purpose of this analysis. This serves to most accurately reflect the actual situation. Accordingly, countries that have not reported their implementation status could not be taken into account. To most accurately reflect the actual situation, the following trends include only those countries that have reported to the updates and implemented HACT in the respective year of reporting. Countries where HACT is not applicable or where HACT has been postponed are not taken into consideration as this would negatively impact the ratio of progress made in relation to the number of countries.

Table 1: Total Number of Countries versus Reporting Rates and HACT Implementation

Data /Update 30 Sept. 2008 30 April 2009 27 July 2010 07 Oct. 2011 Total Number of listed Countries

136 136 136 150

Reported 80 78 83 114 E/S Africa 15 7 8 14 W/C Africa 11 8 13 15 Arab States 9 7 18 12 Asia Pacific 13 23 23 28 Europe/CIS 9 9 7 19 LAC 24 24 14 26 Reporting carried over from previous updates

- 14 28 16

E/S Africa - 8 8 4 W/C Africa - 4 5 6 Arab States - 1 - 1 Asia Pacific - - - 5 Europe/CIS - - 5 - LAC - 1 10 - HACT Implementing Countries

53 52 72 96

E/S Africa 10 9 12 17 W/C Africa 8 5 10 13 Arab States 7 6 8 10 Asia Pacific 9 15 15 27 Europe/CIS 7 5 8 13 LAC 12 12 18 16


110 | P a g e

Global Table 1: Total Number of HACT Implementing Countries – Selected HACT Process Steps

Graph 1: Selected HACT Process Steps in Percent of Total Number of HACT Implementing Countries

Arab States Table 2: HACT Implementing Countries – Selected HACT Process Steps


87 88 838285 85 83

90

5173

53

63

30 37 39

46

0

20

40

60

80

100

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011

Government Agreements Macro Assessments

Micro Assessments Assurance and Audit Plans

71

8388 9086

100 88

6057 50 7540

1417 25 30

020406080

100120

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011



Number 30 Sept. 2008 30 April 2009 27 July 2010 07 Oct. 2011 Implementing Countries 53 52 72 96 Government Agreements 46 46 60 79 Macro Assessments 45 44 60 86 Micro Assessments 27 38 38 60 Assurance and Audit Plans 16 19 28 44



111 | P a g e

Asia & Pacific Table 3: HACT Implementing Countries – Selected HACT Process Steps


Latin America & Caribbean Table 4: HACT Implementing Countries – Selected HACT Process Steps


100 93 938989 93 87

100

5640 47

59

4440 47

59

020406080

100120

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011



9292

78 8883 7578

100

5875 67

63

25 2533

38

020406080

100120

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011






112 | P a g e

East and South Africa Table 5: HACT Implementing Countries – Selected HACT Process Steps


East and South Africa Table 6: HACT Implementing Countries – Selected HACT Process Steps


100 100 100

76

90 89 8382

80 67 6782

50 67 58 53

020406080

100120

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011



88 8090 77

75 80 9077

38 20

5077

38 60

40

54

0

20

40

60

80

100

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011






113 | P a g e

Europe and CIS Table 7: HACT Implementing Countries – Selected HACT Process Steps


5760 50 69

86

60

88100

0 0

46

0

25 23

020406080

100120

30 Sept. 2008 30-Apr-09 27-Jul-10 07 Oct. 2011



Number 30 Sept. 2008 30 April 2009 27 July 2010 07 Oct. 2011 Implementing Countries 7 5 8 13 Government Agreements 4 3 4 9 Macro Assessments 6 3 7 13 Micro Assessments - - - 6 Assurance and Audit Plans - - 2 3


114 | P a g e

Annex V: Country Example Mozambique - Comparative Analysis FACE Form Management

Practices/FACE Form UNICEF UNFPA UNDP

Signature level of AWP National Provincial National

Planning document as basis for FACE

AWP AWP plus detailed quarterly work plan for each payment request

AWP

Link between request and reporting

Two separate FACE documents and processes for request and reporting. Cash transfer is done before reporting of expenditures for the previous transfer.

One integrated process: Disbursement request for next quarter is based on financial reporting on previous quarter.

One integrated process: Disbursement request for next quarter is based on financial reporting on previous quarter.

Detail of FACE form Per activity Per budget line including Atlas account codes

Per budget line including Atlas account codes

Signatures on FACE form Two signatories: • Programme Officer and Head of Unit (<US$50k); • Head of Unit and Dep. Representative (<US$100k); • Dep. Representative and Representative (>US$100k)

One signature: • Budget Manager (Programme Officer)

One signature: • Budget Manager (Programme Officer)

Direct cash transfer - FACE annexes (in addition to financial report and activity report)

• Detailed budget for the following quarter

• Quarterly work plan • Bank Statement • Bank reconciliation • In some cases, original invoices have to be sent to UNFPA on a quarterly basis to be stamped

• Bank statement • Bank reconciliation

Direct payment - FACE annexes • Copy of invoice • Original invoice • Three quotations

• Original invoice/receipt • Three quotations • Copy of authorization letter

Reimbursement - FACE annexes • Detailed expenditure report

• Copy of authorization letter • Detailed expenditure report

• Copy of authorization letter • Detailed expenditure report • Three quotations • Original invoice/receipt

Frequency of disbursement Sometimes quarterly and in many cases activity based

Quarterly Quarterly

Requirements for next disbursement

Written justification if balance of advance payment is higher than US$5,000. No funds disbursed if implementing partner has not justified outstanding amounts for over six months.

None Minimum 80% expenditure rate of previous disbursement

Percentage distribution of cash transfer modalities

Direct cash transfer: 78% Direct payment: 19% Reimbursement: 3%

Direct cash transfer: 65% Direct payment: 25% Disbursement: 5% DEX: 5%

Direct cash transfer: 80% Direct payment: 10% DEX: 10%


115 | P a g e

Annex VI: Assessment Interview and Teleconference Schedule

List

of H

Q In

terv

iew

ees

No.

Age

ncy

Titl

eD

epar

tmen

tSc

hedu

le1

UN

FPA

Ms.

Ma

ri S

imo

ne

nD

ep

uty

Exe

cuti

ve D

ire

cto

r a

nd

ASG

UN

FPA

06 O

ct. 1

0:30

2U

NFP

AM

r.Su

bh

ash

Gu

pta

Dir

ect

or

Div

isio

n f

or

Ma

na

gem

en

t Se

rvic

es

04 O

ct. 1

1:30

4U

NFP

AM

r.D

r. O

livi

er

Bra

sse

ur

Dir

ect

or

Div

isio

n f

or

Ove

rsig

ht

Serv

ice

s04

Oct

. 10:

005

UN

FPA

Mr.

Ro

be

rto

Fe

rna

nd

ez

Chie

f o

f In

tern

al

Au

dit

Div

isio

n f

or

Ove

rsig

ht

Serv

ice

s04

Oct

. 10:

006

UN

FPA

Ms.

An

jan

a D

as

De

pu

ty D

ire

cto

rD

ivis

ion

fo

r O

vers

igh

t Se

rvic

es

05 O

ct. 1

0:00

7U

NFP

AM

r.M

arc

Ab

ou

-Fa

issa

lA

ud

it S

pe

cia

list

Div

isio

n f

or

Ove

rsig

ht

Serv

ice

s06

Oct

. 10:

008

UN

ICEF

Mr.

Ab

di,

Om

ar

Com

ptr

oll

er

Div

. of

Fin

an

cia

l a

nd

Ad

m. M

gmt.

10 O

ct. 1

5:30

9U

NIC

EFM

r.M

org

an

, Ric

ha

rd

Dir

ect

or

Div

isio

n o

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Annex VII: Reference Documents

• Ministry of Foreign Affairs Denmark: “Evaluation of the Implementation of the Paris Declaration; Phase

One; Synthesis Report” (July 2008).

• MOFA Ethiopia: “Letter to the UN Resident Representative: ‘The Federal Republic of Ethiopia - Ministry of Finance and Economic Development: Extending each fund period to six months and DCT to nine months.” (December 2010).

• UNDG: “Framework for Cash Transfers to Implementing Partners” (UNDG, 2005).

• UNDG: “Frequently Asked Questions – Harmonized Approach to Cash Transfer” (UNDG, 2009).

• UNDG: “Guidance Note: Application of the Programming Principles to the UNDAF” (January 2010).

• UNDG/HLCM: “Addressing Country-Level Bottlenecks in Business Practices” High Level UNDG-HLCM Mission, Mission Report (UNDG/HLCM, 2010).

• UNDG/HLCM: “Addressing Country-Level Bottlenecks in Business Practices” High Level UNDG-HLCM Mission, Implementation Plan (UNDG/HLCM, 2010).

• UNDG: “Meeting Minutes: Meeting on Joint Audit of HACT in Viet Nam” (April 2010).

• UNDG HACT Advisory Committee: “The Harmonized Approach to Cash Transfers. Its Application in a Situation of Weak Implementing Partners” (December 2008).

• UN DOCO: Global Annual Update of HACT Implementation 2008-2011.

• UN DOCO: Country Comments: 2011 Global Annual Update (DOCO, 2011).

• UN DOCO: “Delivering as One Country Led Evaluations; Synthesis Report” (October 2011).

• UN DOCO: “Responses from Country Offices on reasons/bottlenecks for the implementation of HACT” (DOCO, 2010).

• UN DOCO: “Final Results: Common Services and Harmonized Business Operations Survey” (UNDG, 2009).

• UNDP: “HACT Assurance Activities; Spot Check Guidelines” Draft (May 2010).

• UNDP: “HACT Dashboard.”

• UNDP: “Option for HACT Audit; Criteria for HACT Audit Compliance”

• UNDP/UNFPA: “Mission Report Ethiopia of Policy/Programme Directors; Agency Coordination to Support MDGs”.

• UNDP/UNFPA/UNICEF: “Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Malawi” (2011).

• UNDP/UNFPA/UNICEF: “Joint Audit of the Harmonized Approach to Cash Transfers (HACT) in Vietnam” (2010).

• UN Albania: “Country Led Evaluation Delivering as One Albania” (July 2010).


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• UN Cape Verde: “Final Evaluation Report; Country-Led Evaluation Delivering as One United Nations Cape Verde” (September 2010).

• UN Ethiopia: “Concept Note on Six Months Direct Cash Transfer Modality” (May 2011).

• UN Ethiopia: “Implementation Manual for United Nation Agencies Assisted Programmes in Ethiopia” (May 2011).

• UNICEF Ethiopia: “Proposal to reform Direct Cash Transfer Management” (April 2010).

• UN Malawi: “Delivering as One in Malawi. Country-Led Evaluation” (May 2010).

• UN Rwanda: “Country Led Evaluation of Delivering as One in Rwanda” Volume I and II (November 2010).

• UNIDO: “Financial Rules and Regulations of the United Nations Industrial Development Organization (UNIDO)” (V06-54264).

• UN Mozambique: “Delivering as One; Country-led Evaluation 2010” (2010).

• UN Mozambique: “Impact Assessment Study of Harmonized Approach to Cash Transfer in Mozambique” (UNCT Change Management Project, UN Mozambique, 2010).

• UN Tanzania: “County-Led Evaluation of the Delivering as One UN Pilot Initiative in Tanzania” (July 2010).

• UN Uruguay: “Country-led Evaluation of the Delivering as One Experience” (May 2010).

• UN Sierra Leone: “Direct Programme Support” (March 2010).

• UN Viet Nam: “Country-Led Evaluation; Delivering as One” (2010).

• UN Viet Nam: “Note – Vietnam Harmonized Programme and Project Management Guidelines (HPPG)” (March 2011).

PowerPoint Presentations • “Cumulative Presentation on HACT” (UNDP, 2011).

• “Asia HACT Regional Work Shop” (October 2009).

• “Clinic on HACT Bahrain; Micro Assessment Lessons Learned”.

• “Clinic on HACT Bahrain; Lessons Learned and Good Practices from Experience of Implementation since 2005; Macro Assessment”.

• “UNDG Workbooks on HACT”


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Accessed Websites Ipsas: http://www.ipsas.org/en/ipsas_standards.htm Investopia: www.investopia.com OHRLLS: http://www.unohrlls.org/en/ldc/related/59/ OHRLLS: http://www.unohrlls.org/en/ldc/25/ UNDG: http://www.undg.org UNICEF: http://www.unicef.org/infobycountry/stats_popup7.html Word Bank: http://data.worldbank.org/indicator/NY.GNP.PCAP.CD World Bank: http://data.worldbank.org/about/country-classifications

http://www.ipsas.org/en/ipsas_standards.htm

http://www.investopia.com/

http://www.unicef.org/infobycountry/stats_popup7.html

http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

http://data.worldbank.org/about/country-classifications

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