JORDAN Terms of Reference Jordan: Strengthening municipal financial management systems to sustain service delivery in municipalities affected by the refugee crisis Assessment of Municipal Public Financial Management Systems A. PROJECT BACKGROUND AND OBJECTIVES 1. The main key development objective of the program Strengthening municipal financial management systems to sustain service delivery in municipalities affected by the refugee crisis is to strengthen the institutional systems and capacities of selected municipalities in Jordan to enable them to deliver local services in an accountable and financially sustainable manner. The program responds to the needs and challenges of crisis-affected Jordanian municipalities, in ways that both help alleviate municipalities immediate crisis-related issues and simultaneously build long-term institutional resilience. Substantively, the project will aim to strengthen municipal financial management systems and capacities, to enable them to provide better services in a more sustainable manner. Geographically, the project will focus on 20 municipal governments in Jordan s northern governorates that have seen the largest influx of refugees and that are also targeted by the Multi-Donor Trust Fund-financed Emergency Services and Social Resilience Project (ESSRP) implemented by the World Bank. While this proposal is confined to the 20 municipalities, some of the outputs and the learning from this project could potentially be scaled up to the rest of the municipalities 2. The purpose of this assessment is to map the current systems of PFM in Municipalities, (including planning, capital and recurrent budgeting, accounting, financial reporting, cash and assets management, internal controls and internal audit, human resources, audit, legislative Scrutiny and oversight) and to identify their strengths and weaknesses from the perspective of good municipal management and efficient and accountable service delivery. 3. The outcomes of the assessment would help targeted beneficiary municipalities to modernize their current PFM systems and practices by (1) enhancing the efficiency of PFM processes through appropriate use of Information Technology and (2) re-engineering the PFM processes and making them results focused and in tune with the management challenges faced by municipalities. The assessment will provide a baseline of the performance of current systems and provide recommendations for designing the Technical Assistance Program that would follow. A tailored package of technical assistance and capacity building will be designed for each municipality to improve their financial management systems and performance. The project will help automate in a limited scale the day-to-day financial management processes of the selected municipalities by designing and implementing a municipal financial management information system.
B. SCOPE OF WORK 4. The consultancy firm will be required to achieve the following under this TOR corresponding to the above mentioned activities: i) Assess the current institutional arrangements of municipalities PFM systems and how effectively these are functioning; and ii) Assess the design and functioning of the core PFM processes: Budget preparation and execution; Fund Flows; Accounting; Financial Reporting; Internal and other Management Controls; Cash and Asset Management; Arrears management, Audit; Legislative Scrutiny and Oversight, and human resources. For instance and not limited to: Budgeting: How are budgets for Targeted municipalities are determined? Does this have a relation to the amount of funds provided by Government? Do budgets have a relation to the municipality s performance? Is budgeting the main basis for control and accountability? Are all public funds of municipalities reflected in their budgets and accounts (are there any off-budget items)? How and when are the budgets allocations and disbursements released to the municipalities (for various sources of funds); what is the process followed? Is there any system for evaluation of budget performance or achievement of budget targets? Fund Flows: What are the main categories of fund flows? What are the main sources of inflows, both own source and transferred funds? What are main sources of expenditures? Quality of cash flow management? Accounting: Are there specified accounting standards? What basis of accounting is followed? Who does accounting? Who does payroll related functions (PF, insurance, pension, etc)? How are payments and receipts functions handled? What is the classification system used? Financial Reporting: What is the form and content of financial statements/reports? What is the frequency? Are any specific standards followed? Are these in a userfriendly format? Are their contents useful and relevant? Are these complete (include all public funds and disclose all material aspects)? Are reports disseminated and monitored? How timely are reports on average? Arrears Management: assess how effective are municipalities in managing their income arrears, use of ageing analysis, any legal action/enforcement are utilized against long outstanding debt? Internal and Management Controls: Are there uniform standards of the internal control systems, procedures, internal audit, etc. for all municipalities? Do they follow general Government procedures or have their own procedures? Are financial powers and delegation of authority defined and followed? Are thresholds defined for Banking and Cash transactions? Are Bank Reconciliation Statements prepared timely? Is there any safeguard policy for fixed assets? Is there inventory management including physical verification system? Audits: Nature, timing, scope of audit. Who does the audits? Are auditing standards specified? What is covered in the audits? Form and content of Audit Report. How complete is the audit? What is the follow-up mechanism to audits? How timely is the audit on average?
Public Representatives and Legislative Scrutiny and Oversight: Who does it? What are the issues covered? What is the role of parliamentary oversight committee for municipalities? What happens when services fail or municipalities default on their financial obligations? Human Resources and training: Are there approved organization charts with job description and reporting obligation? How is the staff pattern for accounting (actual need vs existing staff, staff qualification)? Are they deputed from other Departments or recruited directly)? How is staff trained? Is it effective? C. DELIVERABLES/SPECIFIC OUTPUTS EXPECTED FROM CONSULTANT An Inception Report (IR) which sets out the methodology and approach to the assignment and detailed work plan with milestones and benchmarks to be discussed and approved by the client to ensure that there is agreement of the general understanding of the assignment. A report laying down the results of Gap analysis, and recommendations to enhance PFM systems at targeted municipalities. This would include a road map of suggested reforms to enhance municipalities PFM systems based on short-medium- long terms scenarios. The final report, preliminary draft, final report outline, annexes developed during the assessment and the final assignment report will be prepared in the English language. Any other reports as may be required from time to time by the client. Hard and soft copies of all reports should be available for Client. DETAIL Inception Report reflecting: (a) Confirmed Project scope, goals and objectives with the World Bank (b) Identify possible risks and mitigation plans to facilitate Project success (c) Confirm firm's approach (d) Mobilize Project Team (e) Prepare Project Charter DUE DATE December January 22, 2016 Draft Municipal PFM Assessment Report* April 13, 2017
Final Municipal PFM Assessment Report April 30, 2017 *World Bank team will review and provide comments within a week time. D. SPECIFIC INPUTS TO BE PRESENTED BY THE CLIENT The Consultant should utilize the existing laws, policies, procedures, plans, documents and reports. The Consultant will conduct interviews with all major stakeholders at MOMA and targeted municipalities, and any other Government agencies, as needed. The Consultant will carry out all the activities deemed necessary to achieve the objectives of this consultancy services as mentioned in section B above. E. SPECIAL TERMS & CONDITIONS / SPECIFIC CRITERIA This assignment will begin on December 1, 2016 and will end on April 30, 2017. All services and deliverables under this assignment should be rendered /completed before April 30, 2017. Reporting Lines and Contacts The Consultancy firm will report to the Program Task Team Leader (TTL) who will manage and supervise the assignment to ensure effective delivery and coordinate. Program TTL will coordinate with Ministry of Municipal Affairs (MOMA) to appoint a focal person who will facilitate the firm s work at targeted municipalities. The Consultant will develop and deliver all activities and reports in close collaboration with the World Bank Program TTL. The work of the consultant will be subject to the technical review and quality assurance of the World Bank. Thus, the consultant is to consider that after submission of the deliverables as per above indicated timelines, the World Bank s revision and approval shall be provided within the following ten working days. The approval shall form the basis for payment. The Consultant will meet regularly and as needed with key contacts at MOMA and targeted Municipalities and those closely involved in the project. Payment: 20% upon receiving the inception report: i) confirmed Project scope, goals and objectives with the World Bank; ii) Identify possible risks and mitigation plans to facilitate Project success, iii) Confirm firm's approach, iv) Mobilize Project Team, and v) Prepare Project Charter. 60% upon submission of the draft assessment report 20% upon final approval of report by the World Bank
Reimbursable Travel expenses (such as; air and ground transportation, hotel accommodations, per diem, work-related telecommunications, printing and related expenses) will follow the World Bank guidelines and reimbursable against receipt of invoices. Implementation schedule: Date of commencement: date of signing the contract by both parties.