INSIDE FMIS

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• INSIDE FMIS

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Objective of Briefing

• Objective of this briefing is two fold
• Provide awareness/understanding of the FMR, its
  major components and the key changes associated
  with it and
• To get yourselves prepared to take on the
  implementation of FMR/FMIS

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Outline of Presentation

• Financial Management and its key elements
• Problems with current Financial Management
• FMR Focus Components
• Why FMIS for Whole of Government?
• Benefits of FMIS
• Key Issues in FMIS

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What Is Financial Management?

• Definition
• Financial Management is management of finances
  of an organisation in order to achieve its
  objectives.

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Key Elements of Financial Management
Planning
Management Cycle
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Problems in the Current Financial Management for
Government

• Poor planning
• Lack of performance focus
• Input based
• Poor distribution of limited resources
• Unclear linkages of outputs to national policy
  objectives

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Contd

• Inadequate financial controls
• Poor budgetary controls financial management
  practices
• Untimely and inaccurate reports
• Poor recording of commitment
• Reports lack useful data
• Centralized control vs. CEO accountability

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Financial Management Reform (FMR) Focus

• FMR seeks to put in place a better performing
  budget and financial management system that
  addresses the problems identified through
• adopting a performance focus
• strengthening accountability

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What Does FMR Bring About?

• New Legislation

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Contd

• A move from cash accounting and gradual
  transition (shift) to accrual accounting

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Contd

• A move from traditional line item budgeting to
  performance/output budgeting

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Link between FMR and FMIS

• A new Financial Management Information System
  will support the changes in the FMR

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What is FMIS?

• The Financial Management Information System
  (FMIS) is an integrated database system and will
  be used to support the governments purchasing,
  accounting, payment, sales and receipting
  functions.

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Why an FMIS for the WOG?

• FMIS provides public sector decision makers and
  managers a set of tools to
• Ensure accountability
• e.g. The CEO will be held accountable for any
  over spending in his/her ministry.

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Contd

• Supports decentralization of accounting processes
• e.g. LPOs would be issued from Cost Centres all
  over the country but the head office would still
  have controls over expenditure.

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Contd

• Improve effectiveness and efficiency
• e.g. FMIS will enable faster processing of
  payments as well as receipts.

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Why move?

• Major problems in the manual system are
• Slow processing of payments
• Slow processing of transaction
• Inaccurate untimely financial information and
  reports i.e. information is not recorded on real
  time

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Benefits of FMIS

• Processes large number of transactions in limited
  periods of time across a country wide network of
  offices

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Contd

• Easy retrieval of financial information for
  decision making e.g. financial information can be
  viewed where transactions are generated

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Contd

• Availability of basic data required for economic
  management in a timely manner

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Components of FMIS

• New Chart of Accounts for WOG
• General Ledger
• Accounts Payable
• Purchasing
• Accounts Receivable Sales
• Assets
• Other modules

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More on FMIS

• FMIS has to be tailor made to suit the new
  legislation which includes a new Financial
  Management Act, Finance Instructions and Finance
  Manuals

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Contd

• Continued job security
• with the automated environment

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Key Issues

• Training
• Capacity building within government
• e.g. Change in work practices,from manual and
  paper based to an automated environment e.g.
  expenditure ledger will not be maintained in an
  automated environment.
• Briefings will be done on a progressive basis as
  we proceed

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Contd

• Ownership
• Understanding the reform and the key changes in
  it.
• The accounting heads will need to drive the new
  FMIS implementation in order to succeed. And they
  will need nominate a person who can work closely
  with the FMIS team to assist in the training and
  implementation

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Status of FMIS

• Tendered for a new FMIS in April 2004
• Currently in the evaluation process
• Selection to be finalized by end of September
  2004
• Commence implementation on a pilot basis early
  2005

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Desk Officers

• For your assistance we have set up a helpdesk
  facility should you have any queries regarding
  FMIS.
• E-mail FMRHelpdesk_at_govnet.gov.fj
• Phone [phone]

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QUESTIONS

• THANK YOU