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Government of Rwanda (Gor) 2015 Local Government PEFA PFM

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Government of Rwanda (Gor) 2015 Local Government PEFA PFM Government of Rwanda (GoR) 2015 Local Government PEFA PFM Performance Assessment Kicukiro District Final Report Prepared by AECOM International Team of Chinedum Nwoko (Team Leader) Jorge Shepherd Stephen Hitimana Theo Frank Munya 31 July 2017 i Basic Information Currency Rwanda Franc = 100 cents Official Exchange Rate ((US $, June 2015) 765 RwF (Average) Fiscal/Budget Year 1 July – 30 June Weights and Measures Metric System Kicukiro District Location City of Kigali, Rwanda Government Elected Mayor (Chief Executive) and District Council Political arrangement Administrative decentralization HQs Kicukiro Industrial/Commercial Cities Kicukuro / Urban district Population 318,564 (2012 census) Area 167 km2 Population Density 1,911 persons/km2 (2012 census) Official Languages Kinyarwanda, English, & French ii Kicukiro District PEFA PFM-PR 2015 - Final Government of Rwanda – 2015 Local Government PEFA PFM Performance Assessment – Kicukiro District – Final Report – 31 July 2017 The quality assurance process followed in the production of this report satisfies all the requirements of the PEFA Secretariat and hence receives the ‘PEFA CHECK’. PEFA Secretariat August 28, 2017 iii Kicukiro District PEFA PFM-PR 2015 - Final Disclosure of Quality Assurance Mechanism The following quality assurance arrangements have been established in the planning and preparation of the PEFA assessment report for the District of Kicukiro, Rwanda, and final report dated July 31, 2017. 1. Review of Concept Note - Draft concept note and/or terms of reference dated November 2014 was submitted for review on November 4, 2014 to the following reviewers: - 1) District of Kicukiro - 2) Government of Rwanda - 3) World Bank - 4) Kreditanstalt für Wiederaufbau (KFW) - 5) Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) - 6) UK Department for International Development (DFID) - 7) EU Delegation - 8) Agence Belge de Développement (BTC) - 9) PEFA Secretariat Final concept note dated February 25, 2015 was forwarded to reviewers. 2. Review of draft report - Draft report dated January 2016 was submitted for review on April 22, 2016 to the following reviewers: - 1) District of Kicukiro - 2) Government of Rwanda - 3) World Bank - 4) Kreditanstalt für Wiederaufbau (KFW) - 5) Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) - 6) UK Department for International Development (DFID) - 7) EU Delegation - 8) Agence Belge de Développement (BTC) - 9) PEFA Secretariat 3. Review of final draft report A revised final draft assessment was forwarded to reviewers on May 2, 2017 and included a table showing the response to all comments raised by all reviewers. iv Table of Contents TABLE OF CONTENTS .............................................................................................................................................. V TABLE OF FIGURES ................................................................................................................................................ VI TABLE OF TABLES .................................................................................................................................................. VI TABLE OF SCORE BOXES ....................................................................................................................................... VII TABLE OF CASES ................................................................................................................................................... VII ACRONYMS AND ABBREVIATIONS ...................................................................................................................... VIII ACKNOWLEDGEMENTS .......................................................................................................................................... 1 SUMMARY ASSESSMENT ....................................................................................................................................... 1 STORY LINE ................................................................................................................................................................... 1 INTEGRATED ASSESSMENT OF PFM PERFORMANCE AND THEIR IMPACTS .................................................................................. 1 Credibility of the Budget ...................................................................................................................................... 2 Comprehensiveness and Transparency ................................................................................................................ 3 Policy-Based Budgeting ....................................................................................................................................... 5 Predictability and Control in Budget Execution .................................................................................................. 6 Accounting, Recording, and Reporting .............................................................................................................. 10 External Scrutiny and Audit ............................................................................................................................... 11 PROSPECTS FOR REFORM PLANNING AND IMPLEMENTATION ................................................................................................ 13 SECTION 1: INTRODUCTION ................................................................................................................................... 1 SECTION 2: PROFILE OF KICUKIRO DISTRICT ........................................................................................................... 1 SECTION 3: ASSESSMENT OF THE PFM SYSTEMS, PROCESSES, AND INSTITUTIONS ................................................ 2 BUDGET CREDIBILITY (HLG-1; PI-1 – PI-4) ............................................................................................................. 2 PI-HLG 1: Predictability of Transfers from Higher Level of Government .......................................................... 2 PI-1: Aggregate Expenditure Out-turn Compared to the Original Approved Budget ......................................... 7 PI-2: Composition of Expenditure Outturn Compared to Original Approved Budget ......................................... 8 PI-3: Aggregate Revenue Out-turn Compared to Original Approved Budget ................................................... 10 PI-4: Stock and Monitoring of Expenditure Payment Arrears ........................................................................... 12 3.2 COMPREHENSIVENESS AND TRANSPARENCY (PI-5 – PI-10) ........................................................................... 14 PI-5: Classification of the Budget ...................................................................................................................... 14 PI-6: Comprehensiveness of Information Included in Budget Documentation .................................................. 16 PI-7: Extent of Unreported Government Operations ......................................................................................... 18 PI-8: Transparency of Inter-Governmental Fiscal Relations ............................................................................ 20 PI-9: Oversight of Aggregate Fiscal Risks from Other Public Sector Entities .................................................. 22 PI-10: Public Access to Key Fiscal Information ................................................................................................ 25 3.3 POLICY BASED BUDGETING (PI-11 – PI-12) ...................................................................................................... 27 PI-11: Orderliness and Participation in Annual Budget Process ...................................................................... 27 PI-12: Multi-year Perspective in Fiscal Planning, Expenditure Policy and Budgeting .................................... 29 3.4 PREDICTABILITY AND CONTROL IN BUDGET EXECUTION (PI-13 – PI-21) ..................................................... 36 PI-13: Transparency of Taxpayer Obligation and Liabilities ............................................................................ 36 PI-14: Effectiveness of Measures for Taxpayer Registration and Tax Assessment ............................................ 38 PI-15: Effectiveness in Collection of Tax Payments .......................................................................................... 39 PI-16: Predictability in Availability of Funds for Commitment Expenditure .................................................... 40 PI-17: Recording and Management of Cash Balances, Debt, and Guarantees ................................................. 44 PI-18: Effectiveness of Payroll Controls ........................................................................................................... 47 v Kicukiro District PEFA PFM-PR 2015 - Final PI-19: Transparency, Competition, and Complaints Mechanism in Procurement ............................................ 52 PI-20: Effectiveness of Internal Controls for Non-Salary Expenditures ............................................................ 57 PI-21: Effectiveness of Internal Audit ................................................................................................................ 61 3.5 ACCOUNTING, RECORDING, AND REPORTING ................................................................................................ 63 PI-22: Timeliness and Regularity of Accounts Reconciliation ..........................................................................
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