LFA Training

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LFA Training

• THE GRANT DISBURSEMENTS PROCESS February
  2009
• Geneva, Switzerland

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Overall objectives

• To develop a better understanding of the
  performance-based funding principle and the
  overall GF grant disbursement process
• To highlight the purpose and specifics of the LFA
  function in the disbursement process
• To introduce the forms used and completed by the
  PR, the LFA and the GF Secretariat
• To understand the key components of LFA quality
  reviews and disbursement recommendations

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Performance-Based Funding (PBF)
Performance-Based Funding
Programmatic Monitoring
Financial Monitoring
PBF links ongoing disbursements to the
achievement of programmatic results and
accountable expenditures
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Performance-Based DisbursementsThe Disbursement
Process
DISBURSEMENT PROCESS
GF DISBURSEMENT MANAGEMENT LETTER
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Step 1 The PRs Progress Update and
Disbursement Request

• The PR submits a standardized reporting form
  (PU/DR) within 45 days after the end of the
  reporting period.
• The report includes information on
• Results vs. Targets
• Expenditures vs. Budget
• Contextual Information (key country program
  issues)
• Status of Conditions Precedent (CPs)
• Cash balance and future cash needs
• Requested Disbursement Amount

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Step 2 The LFA Review and Recommendation

• The LFA reviews the PRs PU/DR, completes the
  LFA On-going Progress Review and Disbursement
  Recommendation Form, and submits it to the GF.
• Key steps for the LFA
• Verification of
• - Reported programmatic results
• - Reported expenditures and forecasted cash
  needs
• - Fulfillment of Conditions Precedent
• Review of Contextual Information
• Performance Evaluation and Rating
• LFA Recommendations
• Recommended Disbursement Amount

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Step 3 The GF Review and Decision

• Key steps for the GF Secretariat
• Review the PRs PU/DR
• Review the LFA review and disbursement
  recommendation form
• Evaluate performance and make a disbursement
  decision
• Complete a Disbursement Decision-Making Form to
  document transparently what decision was made and
  why
• The FPM sends a management letter to the PR and
  the GF makes a disbursement

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Performance-based DisbursementsKey aspects of
the GF Review
1 - INDICATOR PERFORMANCE

• Have programmatic targets been reached?

2 - FINANCIAL PERFORMANCE
Overall grant rating

• Are expenditures in line with budgets? Are
  reported expenditures properly accounted for?

3 GRANT MANAGEMENT ISSUES

• Are there any grant management issues that should
  be taken into account in the disbursement
  decision and the grant rating?
• e.g. financial management, ME, SR management,
  procurement

Disbursement Decision
4 EXTERNAL RISKS

• Are there any external risks that should be taken
  into account?
• e.g. governance, national programs, corruptive
  environment

5 - OUTSTANDING REQUIREMENTS

• Are there any requirements that have not been
  met?
• e.g., unfulfilled CP, missing Audit Report, late
  PB Framework

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KEY POINTS

• LFAs critical in helping the GF make
  disbursement decisions
• LFAs recommend, the GF makes the decisions
• The GF communicates results of the review of the
  PRs report and provides recommendations to the
  PR through management letters
• Maintain regular contact with the FPM
• Be cognizant of the program environment in your
  reviews and analysis

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Expectations for LFA Quality Reviews and
Recommendations

• Completeness, accuracy and clarity of the
  products
• - Complete all sections of the form
• - Prepare well written and understandable
  product
• 2. Analysis and consistency
• - Rigorous analysis - sound judgment and
  informed understanding of the relevant
  programmatic and country context
• - Sound and well-justified disbursement
  recommendation
• Feasible and appropriate recommendations
• Timeliness/Responsiveness/Communication
• - Be pro-active
• - Set clear timelines and expectations with the
  PR, and maintain regular contact with the PR and
  the FPM