About Projects
Where there is meant to be accounting
I was under the impression that the project was the entity that permitted
organizations like USAID, the UN and the World Bank to manage their
assistance programs ... but rather than providing a foundation of information
that helps to understand the use and value of fund disbursement, they seem,
rather to add to the confusion.
Project cycle
The standard project cycle is usually described as follows: (1) Identification; (2)
Preparation; (3) Appraisal; (4) Negotiation; (5) Disbursement and
Implementation; and (6) Evaluation.
The basic cycle is reasonable ... but when applied in most of the present relief
and development organizations there is a lot of effort associated with the first
four elements, and insufficient attention to the fifth. Within the disbursement
and implementation part of the project cycle there is a totally inadequate
amount of accounting and measurement of performance.
Where was the money disbursed?
It should be relatively easy to get a listing of where the money has been
disbursed ... that is a listing of the projects, the implementing organizations and
the amounts of money disbursed.
The amount of money disbursed can be either in the form of a listing of
disbursements together with dates, or a cumulative total with date of the
cumulation.
A list of this sort is about as basic an accounting report that one can design ... it is
lists of this sort that are the basic of good accounting control, and it is
incomprehensible that such lists are not easy to access from the public space.
What was the money used for?
It is also reasonable to expect to be able to have a listing of what each of the
organizations used the money for ... the cost of the various activities carried out
by the organization. Every well run organization has this sort of analytical or
cost accounting data ... and if there is an organization that does not have this
data, then one has to wonder why this organization was selected to be a project
contractor.
With information about activities carried out by the organization, it should be
possible to compare the work done under this project with similar work done by
other contractors both in the same country and in other parts of the world. In an
efficient relief and development sector one would expect the costs to be
somewhat the same, with easily explained differences based on the special
circumstances of each of the project ... in fact this information is not at all similar,
mainly because few of the organizations are doing this sort of analysis and they
merely spend the money without much attention to cost effectiveness and
performance.
Did the project produce any socio-economic value?
If the relief and development sector was serious about measuring performance
there would be a requirement for projects to be evaluated based on the socioeconomic value created. While this is a part of the appraisal at institutions like
the World Bank, it is very much a theoretical construct at the time of the
appraisal and not very much in evidence during the management of
implementation and in the subsequent evaluation ... but this value creation is the
central raison d'etre for the project ... and not having any metrics about this is
nothing less than mind-boggling.
What about information in Iraq?
The situation in Iraq seems to be very much “business as usual” ... in other
words no more and no less accounting than is normal in the international relief
and development sector.
But there is a difference that should have caused accounting to be made a central
feature of project management, and that is the scale of the fund flows that are
involved. Having poor accounting in a project that is disbursing $50,000 is bad
enough ... but when the projects are disbursing perhaps as much as $20 billion a
year ... then not have excellence in the accounting area is absolutely scandalous.
|
