THE REPUBLIC OF UGANDA
THE EFFECTIVENESS OF THE INTEGRATED
FINANCIAL MANAGEMENT SYSTEM IN
UGANDA
Study Report
April 2015
Ministry of Finance, Planning and Economic Development
P. O. Box 8147
Kampala
www.finance.go.ug
THE REPUBLIC OF UGANDA
THE EFFECTIVENESS OF THE INTEGRATED
FINANCIAL MANAGEMENT SYSTEM IN
UGANDA
Study report
April 2015
Ministry of Finance, Planning and Economic Development
P. O. Box 8147
Kampala
www.finance.go.ug
TABLE OF CONTENTS
Acronyms and Abbreviations .................................................................................................ii
Glossary .................................................................................................................................. iii
Acknowledgements ................................................................................................................. iv
Foreword ................................................................................................................................... v
Executive Summary ................................................................................................................ vi
Chapter 1: Introduction .......................................................................................................... 1
1.1 Overview .............................................................................................................................. 1
1.1.2 Strategic Policy Context ................................................................................................... 1
1.1.3 Public Financial Management Reforms ............................................................................ 1
1.1.4 Integrated Financial Management System ........................................................................ 3
1.2 Objectives of the Study ........................................................................................................ 6
1.3 Justification of Study ........................................................................................................... 6
1.4 Report Outline...................................................................................................................... 7
Chapter 2: Methodology.......................................................................................................... 8
2.1 Scope of the Study ............................................................................................................... 8
2.2 Data Collection Methods ..................................................................................................... 8
2.3 Sampling procedure ............................................................................................................. 8
2.4 Study Limitations ................................................................................................................. 9
Chapter 3: Study Findings .................................................................................................... 10
3.1: The extent of streamlined financial management processes ............................................. 10
3.2 Factors influencing the use and functionality of the IFMS................................................ 23
3.3 The level of integration and scalability with other systems ............................................... 26
Chapter 4: Conclusions and Recommendations ................................................................. 29
4.1 Conclusions ........................................................................................................................ 29
4.2 Recommendations .............................................................................................................. 30
References ............................................................................................................................... 31
Annexes ................................................................................................................................... 33
i | IFMS STUDY REPORT – APRIL 2015
ACRONYMS AND ABBREVIATIONS
ASSIP
Accountability Sector Strategic Investment Plan
BoU
Bank of Uganda
BMAU
Budget Monitoring and Accountability Unit
CCS
Commitment Control System
EFMPII
Second Economic and Financial Management Project
EFT
Electronic Funds Transfer
GoU
Government of Uganda
IFMS
Integrated Financial Management System
IPPS
Integrated Personnel and Payroll System
IT
Information Technology
KCCA
Kampala Capital City Authority
LGs
Local Governments
MDA
Ministry, Department, Agency
MDALGs
Ministries, Departments Agencies and Local Governments
MFPED
Ministry of Finance Planning and Economic Development
NDP
National Development Plan
NTR
Non-Tax Revenue
OAG
Office of the Auditor General
OBT
Output Budgeting Tool
OOB
Output Oriented Budgeting
PAC
Parliamentary Accounts Committee
PEFA
Public Expenditure and Financial Accountability
PFAA
Public Finance and Accountability Act
PFM
Public Financial Management
TIN
Tax Identification Number
TSA
Treasury Single Account
UNBS
Uganda National Bureau of Standards
WAN
Wide Area Network
ii | IFMS STUDY REPORT – APRIL 2015
GLOSSARY
Adverse Opinion: The Auditor shall express an adverse opinion when the Auditor, having
obtained sufficient appropriate audit evidence, concludes that misstatements, individually or
in the aggregate, are both material and pervasive to the effect that financial statements do not
give a true and fair view
Bank Reconciliation: This is a report that explains the difference between the bank balance
shown in an organization’s bank statement, and the corresponding amount shown in the
organization’s own accounting records at a particular point in time.
Cash Limit: Cash limits form the basis for the limit up to which expenditures can be incurred
by the votes in a given quarter against their approved budgets.
Budget Directorate issues the Cash limits to the MDAs and uploads the same on the IFMS.
Consolidated Budget Analysis Report: This Report summarizes Totals for the vote for the
Approved Budget, Supplementary Budget, Revised Budget, Accounting Warrants, Releases,
Commitments, Payments and Funds Available for programmes.
Disclaimer of Opinion: The Auditor disclaims an opinion when the auditor is unable to
obtain sufficient appropriate audit evidence on which to base the opinion, and the Auditor
concludes that the possible effects on the financial statements of undetected misstatements, if
any, could be both material and pervasive
Management Reports: These are summarized performance reports used by senior
management for planning and decision making. IFMS BIG reports are examples of
management reports
BIG aggregate budget performance report (Development): This Report is run when a user
wants to look at the aggregate Budget performance for a vote in respect of
Development/Capital Expenditure. It summarizes Totals for the vote for the Approved
Budget, Supplementary Budget, Revised Budget, Accounting Warrants, Releases,
Commitments, Payments and Funds Available for only Projects
Misstatements: These are account balances in financial statements that are over or
understated also errors in the financial statements whose effect could be material or not
material to the financial statements
Process Controls: Internal system checks for transactions carried out on the system.
Qualified Opinion: Opinion issued by the auditor on the financial statements where, the
Auditor, having obtained sufficient appropriate audit evidence, concludes that misstatements,
individually or in aggregate, are material, but not pervasive, to the financial statements;
Unqualified Opinion: Opinion expressed by an auditor when the financial statements give a
true and fair view in all material respects and comply with the stated financial reporting
framework.
iii | IFMS STUDY REPORT – APRIL 2015
ACKNOWLEDGEMENT
The study was conducted by a team from the Budget Monitoring and Accountability Unit
(BMAU) led by Mrs. Margaret Kakande and Mr. Justus Kalebbo. The Team members
included all Technical Monitoring officers namely: Mrs. Rosetti Nabbumba Nayenga, Mr.
Matthew Lubuulwa, Mrs. Angella Basaasira Ssali, Mr. Charles Nsubuga, Ms Alice Ninsiima,
Mr. Ibrahim Lubwama, Mr. Mulolo Francis, Mrs. Annette Mutoni Oleng, and Mrs. Margaret
Ntorantyo. The Team was assisted by the BMAU Monitoring Officers: Ms Mariam
Nakakande, Ms Noelline Gwokyalya; Mr. Isaac Ssenyonjo, Mr. Kefa Kawanguzi, Mr.
Valerian Muyise , Ms Irene Achiro, Ms Najjuma Esther, Ms Winnie Adite, Ms Mbabazi
Sandra, Mr. Apollo Ruyonga, Mr. Dennis Munyhirwa and Mr. Silver Kato.
Mr. Allan Gitta, and Ms Annet Sherina Nansubuga provided the study team with
administrative support.
The Research Team was trained about the IFMS by Mr. Robert Muwanga and Mr. Godfrey
Ssemugooma, Commissioner Financial Management Services under the Accountant
General’s Office- who provided useful information and guidance to the study.
The Research Team met with officials at both central and local government levels. Special
thanks to the officials in the 12 Ministries, 20 Departments and Agencies, 4 Hospitals and 23
Local Governments that were visited.
The draft report was assessed by a group of officials from the Accountant General’s Office
who provided very useful comments and Technical support.
The BMAU communications team, Ms Maria Muzaaki and Ms Sylivia Atuhaire supported
the editing work.
Lastly thanks to DANIDA for funding the study.
iv | IFMS STUDY REPORT – APRIL 2015
FOREWORD
To attain the Vision 2040 and improve service delivery to the citizens, the Government is
tasked to ensure: availability of resources to implement the planned programmes; increased
efficiency in the allocation and use of resources; elimination of corruption and wasteful
spending; intensified accountability and strengthening public sector institutions and systems.
The Government has been implementing Public Finance Management (PFM) reforms since
the early 1990s to establish and enforce internal control systems, enhance capacities and
strengthen oversight institutions to ensure value for money in service delivery and
accountable use of public resources. The Integrated Financial Management System (IFMS) is
part of the broader ongoing PFM reforms intended to improve budget preparation,
accounting, reporting and auditing processes. Effective implementation of the IFMS makes a
major contribution in achieving the PFM objectives.
This study is a review of the effectiveness of the IFMS that was conducted in participatory
manner. This is critical in informing Management of the progress so far and what must be
done to ensure that the IFMS delivers as expected. The various stakeholders should therefore
reflect on the findings and recommendations therein.
Keith Muhakanizi
Permanent Secretary/ Secretary to the Treasury
v | IFMS STUDY REPORT – APRIL 2015
EXECUTIVE SUMMARY
Background
The Government of Uganda initiated the implementation of the Integrated Financial
Management System (IFMS) in the FY 2003/04. The IFMS aimed at the promotion of
efficiency, effectiveness, accountability, transparency and comprehensive financial reporting.
The functionality of the IFMS varies between ministries, agencies, departments, and local
governments.
The study aims to assess the effectiveness and present solutions that can serve as best practice
guidelines in the implementation of the IFMS.
Methodology
The study was conducted in a total of 59 Ministries, Departments and Local Governments (12
Ministries, 20 Departments and Agencies, 4 Hospitals and 23 Local Governments) that are
currently using the IFMS. The period of study covered five financial years ranging from FYs
2008/09- FY2013/14.
Both primary and secondary data sources were used. Secondary methods entailed conducting
an extensive review of the relevant literature, while primary data was collected from 252
officials through interviews.
The study was limited by the short time frame as well as busy schedule of the staff at the
Accountant General’s Office.
Findings
Many institutions were using various systems for financial transactions. Although the other
financial systems were said to be complementary, some transactions that could be executed
on the IFMS were still off the system. All of these systems are not interfacing with the IFMS.
Except for the General ledger module, all Modules in the IFMS are fairly used. Although
largely new on the IFMS, it was the local governments that exhibited highest application of
the modules. However, it was noted that the Budgeting Module had been replaced by the
OBT and some inconsistencies were reported between the IFMS and OBT budget
information.
There has been some improvement in financial management as financial reporting had
improved in terms of timeliness and accuracy. In addition, the percentage of institutions
(Ministries, Departments, Agencies and Local Governments) with un-qualified audit
opinions, increased slightly from 47% to 50% over the review period. However, the quality
of financial statements remains poor given the persistent high number of qualified audit
opinions among institutions connected to the IFMS. For Ministries and Departments the
IFMS related reasons for the qualified opinions was increasing despite the fact that the
system had capabilities to containing such problems.
Although the IFMS was reported to have adequate controls at different user levels, domestic
arrears and over expenditures continued to be unchecked. These were largely due to
budgetary indiscipline. Since most IFMS users had been trained, the limitation in capacity
may not wholly explain the persistent weak financial management practices.
vi | IFMS STUDY REPORT – APRIL 2015
The main challenges faced on the IFMS were downtime and inadequate knowledge. The most
frequent reported cause for downtime was poor network connectivity, intermittent power; and
ineffective computers respectively.
Inappropriate distribution of roles was reported as affecting the implementation of IFMS
operations. For example the limited access by Internal Auditors and heads of departments
limited effective application of the IFMS in those areas. On the other hand, the fact that even
transaction of small monies needed the approvals of Accounting Officers, who were often off
their desks, also affected timeliness of IFMS operations.
The operational constraints of the IFMS were also hampering planned rollouts across all
government institutions.
Conclusion
The IFMS is a robust financial management system that has effectively worked in many parts
of the world. In Uganda the expected outcomes have not been fully achieved because of the
de-incentivised human resource. Many institutions were using systems that were not
interfacing with the IFMS, and in instances of uploading information onto the IFMS, the
human element determined the pace and reliability of operations.
Recommendations
1. MFPED and National Information Technology Authority (NITAU) should fast track
the national transmission backbone infrastructure (NBI) project; this development
would strengthen the network connectivity especially in light of the increasing
number of users on the IFMS.
2. MFPED should institute incentives and penalties to minimize human errors by
officials working on the IFMS and interfacing systems.
3. MFPED should facilitate IFMS interfaces with other systems that institutions must
continue using especially where the external funding requires a separate accounting
system
4. The Accountant Generals Office should scale up the IFMS to show individual
outstanding advances in lieu of further authorizations of funds to officials.
5.
MFPED and Ministry of Public Service should include financial management
performance indicators for Accounting Officers.
vii | IFMS STUDY REPORT – APRIL 2015
CHAPTER 1: INTRODUCTION
1.1 Overview
This is a report for a study on the Effectiveness of the Integrated Financial Management
System (IFMS) in Uganda. The study was undertaken by the Budget Monitoring and
Accountability Unit (BMAU) of the Ministry of Finance, Planning and Economic
Development (MFPED) with financial support from the DANIDA under the Support to
Budget Monitoring and Accountability project.
1.1.2 Strategic Policy Context
The Government of Uganda (GoU)’s Vision 2040 is “A transformed Ugandan society from a
peasant to a modern and prosperous country within 30 years”1. It is envisaged that the
country will graduate to the middle income segment by 2017 and reach a per capita of US$
9,500 by 2040. To attain this Vision and improve service delivery to the citizens, the
government is tasked to ensure: availability of resources to implement the planned
programmes; increased efficiency in the allocation and use of resources; elimination of
corruption and wasteful spending; intensified accountability and strengthening public sector
institutions and systems.
These fundamental aspirations of the Vision 2040 are translated into actionable strategies in
the National Development Plan (NDP) 2010/11-2014/152 and Accountability Sector Strategic
Investment Plan (ASSIP) 2014-20193. Accountability and efficient and effective management
of resources are noted to be key elements in good governance. The NDP tasks the
government to enhance value for money in management of public funds by ensuring i)
efficient use of public resources for better service delivery ii) effectiveness and impact of
accountability policy and action.
In the recently launched ASSIP, the government committed itself to enhancing coordination,
planning, mobilization, allocation, management and reporting of public resources and
enhancing compliance with rules and regulations. Effective implementation of the IFMS
makes a major contribution in achieving these strategic objectives of the NDP and ASSIP.
1.1.3 Public Financial Management Reforms
The IFMS is part of the broader ongoing Public Finance Management (PFM) reforms
intended to improve budget preparation, accounting, reporting and auditing processes. This
section provides a summary of the ongoing PFM reforms to contextualise the study. The
PFM reforms are primarily designed and implemented by the Accountability Sector 4. The
Vision of the Accountability Sector is “To ensure transparency and accountability in public
service delivery” and the mission is “to promote efficiency and effectiveness in mobilization
and utilization of public resources”5.
1
GoU, 2010.
NPA, 2010.
MFPED, 2014.
4
The sector is comprised of 10 autonomous institutions namely: MFPED, Inspectorate of Government, Directorate of Ethics and Integrity, Office of the Auditor
General, Uganda Bureau of Statistics, Uganda Revenue Authority, Public Procurement and Disposal of Assets Authority, Kampala Capital City Authority,
Ministry of Public Service and Ministry of Local Government
5
MFPED, 2014.
2
3
1 | IFMS STUDY REPORT – APRIL 2015
The GoU has been implementing PFM reforms since the early 1990s to establish and enforce
internal control systems, enhance capacities and strengthen oversight institutions to ensure
value for money in service delivery and accountable use of public resources. The reforms can
be divided into two broad categories: legal and institutional reforms and operational reforms.
Many of these reforms provide the legal and technical basis for establishment and roll out of
the IFMS.
Legal and institutional reforms
Several legislations have been enacted and existing laws strengthened to enhance
accountability systems and oversight functions. Institutional reforms have also been
undertaken to streamline public financial management processes. These include:
1) Uganda Revenue Authority Act 1991
2) Local Governments Act 1997 as amended
3) The Budget Act 2001
4) The Public Finance and Accountability Act (PFAA), 2003
5) The Petroleum Exploration, Development and Production) Act, 2013
6) Inspectorate of Government Act 2002
7) Leadership Code Act 2002
8) The Public Procurement and Disposal of Public Assets (PPDA) Act, 2003 as amended
9) Access to Information Act, 2005
10) National Audit Act, 2008
11) Anti-Corruption Act, 2009
12) Whistleblower’s Protection Act, 2010
13) The Electronic Transaction Act, 2011
14) Computer Misuse Act, 2011
15) Anti Money Laundering Act 2013
16) Public Finance Bill, 2012
Key reforms
The following are the key reforms aimed at improving efficiency and effectiveness of public
expenditure management:
1) The Commitment Control System (CCS)
2) Automation of Financial Management Processes (IFMS)
3) The Electronic Funds Transfer (EFT) and Straight through Processing of Salaries
(STP)
4) Fiscal Decentralization Strategy (FDS)
5) Non–Tax Revenue (NTR)
6) Tax Reforms/Electronic Taxation (e-tax services):
7) Aid Management System
8) Debt Management Systems
9) Output Oriented Budgeting (OOB)
10) Budget Monitoring and Accountability Unit (BMAU)
11) Treasury Single Account (TSA)
12) Integrated Personnel and Payroll System (IPPS)
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13) Decentralised Salary Payment Processing
14) Results Oriented Management (ROM)
15) Service delivery standards
Many of the operational reforms work through or with the IFMS. The government has
launched the Uganda PFM Reform Strategy (July 2014 – June 2018)6 to consolidate and
sustain implementation of all PFM reforms.
1.1.4 Integrated Financial Management System
In the 1980s’ the Government recognized that availability of information was a prerequisite
for economic and financial management improvement. The major problems faced were the;
inaccurate, untimely and inappropriate budget and accounting information. These were
characterized by; manual and partially automated systems, no systems for independent and
decentralised local governments, weak capacity in implementation and inspection, inadequate
systems for collection and tracking of revenue, backlog of un-reconciled bank accounts, lack
of a uniform Chart of Accounts that complied with Government Finance Statistics (GFS),
endemic budget overruns, Ad-hoc and uncoordinated IT acquisitions; and non-compliance
with international public sector accounting standards.
The Government of Uganda through the Economic and Financial Management Project
(EFMP II) initiated the implementation of the Integrated Financial Management System
(IFMS) in the FY 2003/04. This was a tool designed to improve efficiency in the financial
information processing and reporting systems. An IFMS is a fiscal and financial management
information system for Government that bundles all financial management functions into one
suite of applications. It is an IT-web based budgeting and accounting system that assists GoU
entities to initiate, spend and monitor their budgets, initiate and process their payments, and
manage and report on their financial activities.
a) Objectives of the IFMS
The IFMS was set up for four main objectives.
1. To improve fiscal management in order to achieve more timely, and accurate
information for both local and central government.
2. To ensure transparency and accountability in the handling and use of public resources.
3. To strengthen the Government financial management processes and provide better
expenditure controls.
4. To enhance operational effectiveness by improving quality of data and making it
available for use and sharing.
5. To standardize and automate Government financial management processes to reduce
redundant and unnecessary tasks and activities
6. To maximize the cost effectiveness of the expenditure of public funds.
7. To improve revenue management.
6
MFPED, 2014a
3 | IFMS STUDY REPORT – APRIL 2015
b) Process of setting up the IFMS
Government of Uganda commissioned a Fiscal Management Systems Study (FMS) that took
place between October 2001 and April 2002. Ernst & Young Consultants undertook the FMS
study. The study aimed at developing a framework of the principles and standards for the
introduction of government wide IT based Fiscal Management Systems that would meet
current and future needs. The consultants prepared and submitted an Information Technology
Architecture and Plan (ITAP) report detailing the recommended business and information
processes as well as the User Requirements Specifications and proposed technology options.
Following a selection process closely supervised by GoU and the World Bank a contractor
M/s Hewlett Packard International Trade BV (HP) was contracted to implement the IFMS.
HP was assisted by a number of sub-contractors among them Oracle Systems Limited,
Computech Uganda Ltd, Venture Communications Group Ltd and RPC Data Ltd. A turnkey
concept was adopted where GoU held one supplier (HP) responsible and accountable for all
the deliverables including those of the sub-contractors. HP was responsible for the supply,
installation, integration, testing, commissioning and providing the related support services for
the IFMIS solution under this arrangement. The costs for IFMS implementation were
financed with assistance from the World Bank and other Development Partners. GoU also
allocated counterpart funds in the budget to support the IFMS implementation.
GoU adopted a structured project management approach and a dedicated project office was
setup to support the IFMS implementation. A high level IFMS project Steering Committee
consisting of senior GoU representatives and chaired by Permanent Secretary/Secretary to the
Treasury was put in place. To ensure GoU ownership a multi-disciplinary Project
Management Team (PMT) consisting of representatives from different Ministries /Agencies
is chaired by the Accountant General was established. Various work Groups for key project
management functions headed by GoU Commissioners supported the PMT. Currently, the
management of the IFMS implementation has been mainstreamed into the departments within
the Ministry of Finance, Planning & Economic Development and a Commissioner has been
assigned as Project Manager. Implementation is coordinated through the Project Monitoring
Team (PMT) which meets monthly and comprises heads of department responsible for
training, security, application and budgeting among others.
A phased implementation approach was adopted. The implementation commenced with the
pilot phase covering 6 Ministries and 4 Local Governments on 1st July 2003. Following the
successful implementation of the pilot phase, Government of Uganda in April 2005 formally
signed off the pilot phase and consequently entered into contract with HP to extend the
implementation to the remaining 12 Ministries, additional 9 Local governments and a
Disaster Recovery Centre. Currently, 89 MDAs (63 Central Governments, 14 Local
Governments and 8 Donor Funded Projects) are transacting in real-time mode on IFMS.
IFMS initial focus was on key Expenditure Management processes that include the
Accounting and Reporting (General Ledger), Budgeting, Purchasing and Commitment
Accounting, Payments, Cash Management and Revenue Receipting/Accounts Receivable.
Plans are in advanced stages to rollout the IFMS to the remaining MDAs and Projects and
bring on board additional modules like the Fixed Asset Management.
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c) IFMS Modules
The IFMS is based on the Oracle E-Business suite IT package. It automates processes
required by the Public Finance and Accountability Act 2003 and the Local Government Act
1997. The modules currently in operation by oracle are:
1) Oracle Public Sector Financials/General ledger module: This module is used to;
enter and post journals, budget inquiries, opening of budget year, funds inquiries,
others Issuance of a Grant of Credit by the Auditor General, Issuance of the Ministers
Warrant by the Accountant General, Issuance of Cash limits by the Budget
Directorate, Preparation of the Accounting Warrants by the Votes, Initiation and
Approval of virements or re-allocations and generation of management reports.
2) Receivables module: This module is used to; Enter customers, enter and approve
invoices and to enter receipts. It also used to enter bank charges and bank transfers
and the generation of receivables reports.
3) Purchasing module: This module is used to create suppliers on the system, prepare
purchase requisitions, and approve purchase requisitions, enter and approve purchase
orders and finally enter purchase receipts.
4) Payables module: This module is used to; create supplier invoices from supplier
information, approve invoices, make payments, make prepayments ( to employees or
suppliers) and generate payables reports
5) Cash management module: This module is used to; create bank accounts, it also
used to enter/ upload bank statements and to perform automatic bank account
reconciliations
As a way of improving on the system, the Fixed Asset Management module has been
introduced. This is being piloted in Votes of; Ministry of Agriculture Animal Industry and
Fisheries (MAAIF), Uganda Industrial Research Institute (UIRI), Ministry of Finance,
Planning and Economic Development (MFPED), Ministry of Health (MoH), Ministry of
Energy and Mineral Development (MEMD), Judicial Service Commission (JSC), Office of
the Prime Minister (OPM), Ministry of Gender, Labor and Social Development (MGLSD),
and Ministry of East African Affairs (MEACA).
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IFMS MODULES
BUDGETING MODULE
RECEIVABLES MODULE
Entry of VoA
&Initial Budget
Entry of Release Receipts
Grant of Credit
Entry of NTR Receipts
Minister’s Warrant
Cash Limits
Accounting Warrants
Release Request
Reallocation /
Virements
PURCHASING MODULE
Preparation of Purchase
Requisition
GENERAL LEDGER
 Entry of Manual Journals
 Posting of Journals
 Inquiries for Decision
Making & Audit
 Running of Financial
Reports
CASH MANAGEMENT
Reconciliation of
Receipts
Reconciliation of
Payments
PAYABLES MODULE
Preparation of Purchase
Orders
Entry of Supplier Invoices
Acknowledgement of
Supply
Entry of Employee
Invoices
Approval of Invoices
Payment of Processing
d) Coverage of the IFMS
IFMS is being implemented in 63 sites for central votes, four (4) referral hospitals, fourteen
(14) local governments, eight (8) projects under Tier 1, and 26 Tier 2 sites that run with a
common Chart of Accounts across Government.
1.2 Objectives of the Study
The overall purpose of this study was to evaluate the extent to which the objectives of the
Integrated Financial Management System (IFMS) have been met. More specifically, the
study was intended to:
i. Establish the extent to which the IFMS has streamlined financial management
processes.
ii. Establish factors influencing the use and functionality of the IFMS
iii. Establish the level of integration and scalability with other systems
1.3 Justification of Study
Government of Uganda introduced the IFMS aimed at the promotion of efficiency,
effectiveness, accountability, transparency and comprehensive financial reporting.
6 | IFMS STUDY REPORT – APRIL 2015
The functionality of the IFMS varies between the ministries, agencies, departments, and local
governments (MADLGs). The introduction of IFMS is a reform that deeply affects work
processes and institutional arrangements governing the management of public finance. The
usage of IFMS has not been free of challenges and obstacles.
There have been increasing allegations of financial fraud among IFMS users7, delayed
payments to service providers, low absorption of funds, delayed procurement of services and
persistent loopholes of inaccurate, untimely, inappropriate budget and accounting information
even after the introduction of the IFMS. There have also been capacity gaps on the side of
users that hamper the full utilization of the IFMS.
The study aims to assess the effectiveness and present solutions that can serve as best practice
guidelines in the implementation of the IFMS. It is hoped that this study will give guidelines
to facilitate future implementation of the IFMS in Uganda. Users of the IFMS will be in
position to enhance the adoption of the recommendations that will be highlighted.
1.4 Report Outline
The report consists of four chapters. Chapter two provides an insight into the overall study
methodology. Chapter three provides the findings and analysis of the study, while Chapter
four is on conclusions and recommendations.
7
`New Vision paper dated October 30th,2012
7 | IFMS STUDY REPORT – APRIL 2015
CHAPTER 2: METHODOLOGY
2.1 Scope of the Study
The study is about the effectiveness of the IFMS in the sphere of government operations. The
study focused on the extent to which the IFMS effectively covers government financial
transactions – revenue receipts, debt, expenditure and support to budget planning
The study was conducted in a total of 59 Ministries, Departments and Local Governments (12
Ministries, 20 Departments and Agencies, 4 Hospitals and 23 Local Governments) that are
currently using the IFMS. Details of the entities involved are listed in Annex 1.
The period of study covered five financial years ranging from FYs 2008/09- FY2013/14.
2.2 Data Collection Methods
Both primary and secondary data sources were used. Secondary methods entailed conducting
an extensive review of the relevant literature. The reviewed documents are attached as
References.
Primary data was collected at two levels of Government:
 Central Government
 Higher Local Government (District and Municipality)
At all levels, direct interviews were held with the relevant officials. This was to assess the
effectiveness of the IFMS in the execution of the budget and operation of other government
financial transactions. The government financial transactions included; revenue receipting,
payments, purchasing, and report management.
The 252 respondents included the accounting officers, accountants, and other senior
personnel assigned to carry out financial management functions and related activities on the
IFMS (Detailed list of respondents is attached as Annex 2)
The questionnaire was structured into sections to capture data and information on budget
processes, financial transaction processes, transparency and controls, timeliness, accuracy
consistency and completeness of reports, user competence, user satisfaction index, systems
integrity and security and systems maintenance and support.
Key informant interviews were held with the office of the Accountant General, Bank of
Uganda and Uganda Revenue Authority.
2.3 Sampling procedure
The selection of the sample was done using a multi-stage and purposive sampling design (see
Annex 3 for details). The first stage of the selection was for implementers of the IFMS in
government institutions, which role falls under the office of the Accountant General. The
three officers interviewed from this office were the; Accountant General, Commissioner
Financial Management Services, and Assistant Commissioner Financial Management
Services. The purpose for their selection was to;
8 | IFMS STUDY REPORT – APRIL 2015



Understand how the IFMS was setup in interfacing with other systems
Understand the challenges related to the Integration of the systems and
Challenges faced by government in rolling out the IFMS to agencies and local
governments
The second stage of selection was for the users of the IFMS at the different levels. The users
were selected from the Tier 1 and Tier 2 systems. The Tier 1 comprised of 45 institutions (32
central government ministries and agencies, 9 local governments and 4 referral hospitals,).
The Tier 2 system comprised of 14 district local governments.
A sample of institutions was selected at random using a table of random numbers.
The third stage of selection was for the institutions that interface with the IFMS. The
institutions were Bank of Uganda (BoU), and Uganda Revenue Authority. These interface
with the IFMS at the points of collecting balances of revenue and clearing of invoices for
salary and other payments created in the IFMS.
2.4 Study Limitations
1. The study period was too short to comprehensively cover all aspects in the IFMS. It
was therefore restricted to the modules and opinions about the system.
2. Key direct procedures on the system were not done on account of unavailability of
staff with right to the IFMS from the Accountant Generals office and the requirement
for off peak periods. The timing of the study coincides with a very busy schedule for
the relevant staff.
9 | IFMS STUDY REPORT – APRIL 2015
Chapter 3: Study Findings
The findings are given under each study objective.
3.1: The extent of streamlined financial management processes
Background
The financial management processes focused on were budget formulation and execution. The
characteristics of the IFMS and its role in supporting the budget process in the government of
Uganda were identified as follows8:

Design of IFMS based on a centralized architecture that enables central processing
and storage of financial transactions at a server held at the data centre at the MFPED.

Use of open technologies oracle application and the HP UNIX platform - this allows
flexibility to implement interfaces and integrate with other systems for purposes of
sharing data and enhancing efficiency.

IFMS supports the budget planning and preparation process by providing historical
expenditure data.

Support to budget execution - IFMS is configured to implement internal controls in
line with public financial law.
The effectiveness of the IFMS depends significantly on the extent to which it is
comprehensive in covering Government financial transactions and Government departments
throughout the budget process.
3.1.1 Type of the respondents
Out of the 252 respondents, 199 (78%) were male while 53 (22%) were female. The biggest
percentage of respondents (41.3%) was from the accounts departments of the various
institutions visited totaling to 104 respondents. The audit department presented the least
number of respondents (6.4%) See details in Figure 3.1 and Annex Table 1.
8
Lawrence Semakula and Robert Muwanga, Uganda: Implementing an Integrated Financial Management System, July 2012
10 | IFMS STUDY REPORT – APRIL 2015
Figure 3.1: Departments of work for respondents
Source: Field findings
3.1.2 Use of IFMS by Government MALGs
As was noted in background, the installation of the IFMS was phased. The study confirmed
that, except for Ministries, most institutions had been on the IFMS for less than 5 years
(Figure 3.2 and Annex Table 2)
Figure 3.2: Percentage of MALGs that have used the IFMS for less than 5 years
Source: Field findings
Three departments; audit department, accounts department, and administration of the sampled
institutions were fully using the IFMS between 2008 and 2014 (Figure 3.3 and Annex Table
3)
11 | IFMS STUDY REPORT – APRIL 2015
Figure 3.3: Use of IFMS between 2008 and 2014
Source: Field findings
a) Use of IFMS Modules
It was noted that on average apart from the General ledger module, all Modules are fairly
used (Figure 3.4 and Annex Table 4). Although largely new on the IFMS, the local
governments exhibited the highest application of the modules.
Figure 3.4: Percentage of Institutions using the IFMS modules
Source: Field findings
The IFMS users had been trained in use of the Modules. The training depended on need.
Training had been imparted mainly for the Payables Module (61.5%) and the Purchasing
Module (56.7%) (See Figure 3.5 and Annex Table 5).
12 | IFMS STUDY REPORT – APRIL 2015
Figure 3.5: Percentage of respondents trained by type of training under IFMS
Source: Field findings
b) IFMS Applications
Most respondents (75%) agreed that the IFMS is useful in budgeting, especially during
preparation (93%) and execution (98%). However, the Budgeting Module had been replaced
by the Output Budgeting Tool (OBT) that was being used. Some respondents (30%) reported
minimal use of IFMS information during budgeting.
This has resulted into some reported inconsistencies between the OBT and IFMS budget
information especially in referral hospitals and ministries (Figure 3.6).
Figure 3.6: Institutions reporting inconsistencies between OBT and IFMS budget
information
Source: Field findings
This was attributed to the lack of user rights on IFMS for planning units, inadequate capacity
of some planners, and the incompatibility of systems (Table 3.1).
13 | IFMS STUDY REPORT – APRIL 2015
Table 3.1: Causes of inconsistencies between the OBT and IFMS budget
information/outputs9
Ministry
Agency
Statutory Department
Local Government
Referral Hospital
Total
Planning Unit not having
user rights on IFMS
5.0
6.1
2.8
1.1
0.0
3.2
Inadequate capacity
of users
3.3
2.0
0.0
2.2
0.0
2.0
Incompatibility of
systems
10.0
8.2
0.0
1.1
5.6
4.8
Source: Field findings
c) Use of other Financial Management systems
Close to half (46%) of the institutions reported using other financial systems that were
reported to be complementary to the IFMS (See Annex Table 6). The practice was most
prevalent in agencies (65%) and ministries (59%). The most common alternative financial
systems were the Public Procurement Management System (12%); BBS Connect (9%), and
Spread Sheets (6%) (See Annex Table 7).
The institutions gave reasons for use of additional financial management systems, and these
were classified under four thematic areas. Details are in (Annex Table 8).
i.


ii.


iii.
iv.
Requirements by donor transactions (34%):
Some donor/project transactions have not been captured on the IFMS
Some donors have a requirement to feed their transactions in systems provided by
them. However the rollout to donor funded projects had commenced and so far 6
projects were using the IFMS.
Other Requirements (48%):
Procurement – PPDA requirements
BBS Connect for banking
Accrual Reporting (11%): although IFMS has capacity10 to generate accrual reports;
and
Capture of Non-Tax Revenue (7%) although the expectation was that NTR is
receipted on the IFMS for votes where the system has been implemented.
As noted, many institutions operated other financial management systems. To that effect, in
virtually all of the MDALGs there are transactions executed outside the IFMS. The type of
transactions executed outside the system varied between institutions. The most common
transactions executed outside the IFMS were revenue receipting, ordering for goods and
services; and tax assessments respectively (Figure 3.7 and Annex Table 9)
9
The respondents had multiple responses and therefore there are no Totals across rows/columns
The IFMS is a robust ERP system and has been configured to support both Cash and Accrual bases of accounting.
10
14 | IFMS STUDY REPORT – APRIL 2015
Figure 3.7: Percentage of financial transactions outside the IFMS by type
Source: Field findings
d) Trends in Financial Management
The study reviewed trends in some indicators to assess the effectiveness of the IFMS.
These included:
(i) Auditor Generals Opinions
Most respondents (96%) reported that the IFMS can produce reports11 as stipulated by
government guidelines.
The IFMS system review focused on the quality of the financial statements as
reviewed by the Auditor General with emphasis on the Opinions issued on the
financial statements and the timeliness of the submission of financial statements.

Ministries
For the last five financial years - 2008/09 to 2012/13 more ministries obtained
qualified opinions than unqualified opinions. For the Financial Years 2008/09 to
2010/11, 67% of the ministries had qualified opinions (A sample of 12 ministries was
drawn from the 22 Ministries)12. The trend in the quality of financial statements for
the five year period declined further in the financial years 2011/12 to 2012/13 where
8% of the ministries had their opinions disclaimed by the Auditor General as shown in
(Figure 3.8).
11
Statutory final accounts; Statement of Financial Position, income statements and Cash flow statements, Other reports included Bank
reconciliation reports, Revenue analysis reports, Expenditure analysis reports, Cash Limit reports, and the Consolidated budget analysis
reports.
12
The Ministry of Information was on IFMS for 3 years of the five 5 years analysed.
15 | IFMS STUDY REPORT – APRIL 2015
Figure 3.8: Trend of Auditor Generals Opinions Issued to Ministries for FYs 2008-2012/13
Source: Auditor General’s Annual Financial Reports
Reasons for the Auditor General’s Opinions
A review of the basis of the Auditor General’s opinions for the Ministries was found to have
included the following as the grounds for qualifications; Non availability of documents to
support significant balances in the financial statements, unaccounted for funds, incorrect
reconciliations of opening balances, incorrect bank reconciliation statements, unverified
claims and unauthorized diversions.
There were also cases of double payments, over payments, mischarge of expenditure to
wrong budget codes, refunds made for unbudgeted obligations, overdrawn treasury general
accounts and irregular payments as tax waivers.
For this study an analysis of reasons for opinions issued were either IFMS related or non
IFMS related. The IFMS related reasons were; Mischarges of expenditure to wrong budget
codes, over payments to contractors, unauthorized diversions of funds and incorrect bank
reconciliations The non IFMS related reasons included non availability of documents to
support balances, unverified claims, unaccounted for funds, and non remission of NSSF and
taxes. Over drawn treasury general accounts and wrong valuation of land and buildings.
An analysis of reasons for the Qualifications of Ministries Opinions is shown in 3.9
16 | IFMS STUDY REPORT – APRIL 2015
Figure 3.9 Basis of Opinions Issued to Ministries for FYs 2008/09-2012/13
Source: Auditor General’s Reports
The direct IFMS related reasons for qualification of opinions were proportionately more for
three years out of the five years under review. This is an issue for concern since the IFMS
was supposed to address these problems.

Departments and Agencies
It was noted that the Departments and Agencies have been on the IFMS for only
three years of the five years under study13. For the same review period, the
Government Departments and Agencies showed better performance and especially so
in the financial years 2011/12 and 2012/13 where 81% and 57% respectively posted
unqualified opinions. The two years prior to the IFMS shows more departments with
unqualified opinions. Although there was a decline in performance after introduction
of the IFMS, that gradually improved two years after IFMS inception (Figure 3.10).
There was no Disclaimer and adverse opinion issued to any of the
Departments/agencies in the five year period.
There were cases where no opinion was issued by the Auditor General as the entities
did not exist like KCCA14 and where the final accounts were not signed for lack of an
Accounting officer as it happened in the National Forestry Authority FY 2012-13
13
14
Effectively on the IFMS in FY 2010/11
Some respondents (30%) reported minimal use of IFMS information during budgeting (Figure 3.3).
17 | IFMS STUDY REPORT – APRIL 2015
Figure 3.10: Trend of Auditor Generals Opinions Issued to Departments and Agencies
for FYs 2008-2012/13
Source: Auditor General’s Annual Finance Reports
Reasons for the Auditor General’s Opinions
The reasons for the qualification of the auditors’ opinion included: Expenditure in excess of
the approved budget, diversion of funds from capital development to wages, incurring of new
domestic arrears, inadequately supported expenditure, unaccounted expenditure, unexplained
increases in bank balances and expenditure exceeding cash payments. There were cases of
budget surplus and unbalanced budgets approved. Over statement of payments, wrong
depreciations and mischarge of expenditure and lack of underlying support documents.
The IFMS related reasons were; mischarge of expenditure, expenditure in excess of the
budget and diversion of funds from capital development to wages.
An analysis of reasons for the qualifications of departments and agencies opinions is shown
in 3.11
Figure 3.11: Basis of Opinions Issued to Departments and Agencies FYs 2008/092012/13
Source: Auditor General’s Reports
18 | IFMS STUDY REPORT – APRIL 2015
The non-IFMS related reasons gradually increased from 2010/11 when IFMS was introduced
to the departments and agencies. In the FY 2012/13 the IFMS related reasons were
proportionately equal to the non IFMS grounds for qualification.

Local governments
LGs accessed the IFMS at varying times and therefore the trends analysis was
separated for the durations15. The LGs that have been on the IFMS over the review
period, have had a declining performance since 2009/10 although there was some
improvement at the inception of the IFMS (Figure 3.12)
Figure 3.12: Trend of Auditor Generals Opinions For LGs for FYs 2008-2012/13
Source: Auditor General’s Annual Financial Reports
The LGs rolled onto the IFMS in the FY 2011/12 and 2012/13 show declining qualified
opinions (Figure 3.13).
Figure 3.13: Trend of Auditor Generals Opinions for the LGs is shown in Graph
Source: Auditor General’s Annual Financial Reports
15
On the IFMS for the 5 year analysis period and those on the IFMS for the last 2 years of analysis
19 | IFMS STUDY REPORT – APRIL 2015
Reasons for the Auditor General’s Opinions
The Local Governments experienced the least number of IFMS related qualifications. The
reasons for qualification were unaccounted administration advances, undisclosed revenue in
the accounts, and overstatement of revenue reserves. In the FY 2011/12, when 86% of the
LGs in this study started using IFMS tier 2 systems there was no IFMS related qualification.
There were IFMS related reasons for qualification in the FY 2012/13 although these were
proportionately less than the non IFMS related reasons.
An analysis of reasons for the qualifications of LGs opinions is shown in 3.14
Figure 3.14: Basis of Opinions Issued to Local Governments FYs 2008/09-2012/13
Source: Auditor General’s Reports
(ii) System controls (Domestic Arrears and over payments)

Domestic Arrears
Domestic arrears consist of unpaid bills or other Government commitments that
remain outstanding beyond the fiscal year in which they were incurred. These arise
from a combination of factors, but mainly fiscal indiscipline, i.e. the failure to stick
within the budget programme.
A review of the consolidated financial statements for the period 2008/9- 2013/14,
(Figure 3.15) shows an increasing trend in domestic arrears.
20 | IFMS STUDY REPORT – APRIL 2015
Figure 3.15: Trends for Domestic Arrears
Source: Consolidated Financial Statements
Public Expenditure and Financial Accountability (PEFA) reports noted that Ministries
Departments and Agencies (MDAs) violated the system by placing orders directly with
suppliers without entering them in the IFMS. Those side commitments were often omitted
from the monthly returns to Ministry of Finance, Planning and Economic Development
(MFPED). The budget is often used to pay recent creditors rather than settling old claims.
Fifty three percent of the respondents reported experiencing non wage arrears in the last two
years. This was most prevalent in local governments and referral hospitals (Figure 3.16).
Figure 3.16: Percentage of respondents experiencing non-wage arrears over the last two
years
Source: Field findings
The majority (62%) of causes of non-wage arrears were attributed to non IFMS issues such as
incomplete works, insufficient funds, poor planning and budget suppression (Annex Table
10). However for the two IFMS related causes, the inefficient commitment control system
was more prominent than off system commitments.
21 | IFMS STUDY REPORT – APRIL 2015

Over expenditures
Although 94% of the respondents noted that the IFMS16 could be relied on to control
over expenditures, close to 30 percent of the institutions visited reported having
experienced over expenditures over the last two years.
During the years under review, a number of Local Councils incurred expenditure in
excess of provisions in the approved estimates as shown in (Figure 3.17).
Figure 3.17: Trend of Excess expenditure in Local governments
OAG Reports, FY 2008/09-2012/13
From FY 2008/09 to 2010/11 the amount of excess expenditure increased from Ug Shs 3.004
billion to Ug Shs 12.307 billion. In FY 2011/12, unauthorized excess expenditure reduced by
88%. In FY 2012/13, the unauthorized expenditure again increased by 427%. The excess
expenditure was mainly attributed to inability by Council leaders to provide oversight
scrutiny over budget management and the Accounting Officers’ laxity to enforce controls
relating to expenditure.
(iii)Timeliness of financial transactions
The PEFA17 assessment reports showed performance in timeliness and regularity of accounts
reconciliation as gradually improved from C+ to a performance of B in the last 2 reports.
Availability of information on resources received by service delivery units remained at B for
the three assessments conducted. Quality and timeliness of in year budget reports improved
from D to C+ but the quality and timeliness of annual financial statements had declined from
B+ to C+.
16
The IFMS has an inbuilt commitment control functionality that enforces budgetary control. An LPO or invoice cannot be entered on IFMS if there is no
budget.
17
The GoU has conducted three central government Public Expenditure and Financial Accountability (PEFA) Assessments in 2005, November/December 2008
and June/July 2012 and one local government PEFA assessment in April-June 201217. The PFM performance reports provide an assessment of public financial
management (PFM) in Uganda based on the Public Expenditure and Financial Accountability (PEFA) partners’ Performance Measurement Framework 17.
The highest rating (score of A) implied compliance with accepted international standards. The lowest score was D. An indicator was not scored if there was
insufficient information available for rating.
22 | IFMS STUDY REPORT – APRIL 2015
An Evaluation conducted on the IFMS by the World Bank in conjunction with MFPED
Second Economic Financial Management Project (2006) found that auto reconciliation was
possible with the IFMS and that the backlogs in reconciliations had been considerably
reduced18. Reporting and submission of accountabilities from the LGs had greatly improved.
A review of the submissions of reports to the Office of Accountant General for consolidation
showed a decline in the timeliness of submissions in the years 2010- 2011/12 for the
Ministries, Departments and Agencies.
More than 90% of the respondents reported improved timeliness in various aspects of
financial management with the introduction of the IFMS (Figure 3.18).
Figure 3.18: Respondents perception on changes in timeliness of financial operations
Source: Field findings
3.2 Factors influencing the use and functionality of the IFMS
The study noted the various challenges faced on the IFMS (Figure 3.18).
Figure 3.18: Distribution of challenges faced by IFMS institutions
Source: Field findings
18
Evaluation Report: The Integrated Financial Management System (IFMS) Implementation in Uganda 2007
23 | IFMS STUDY REPORT – APRIL 2015
The main challenges faced were downtime and inadequate knowledge. Downtime mainly
challenged departments and agencies while inadequate knowledge was more pronounced in
referral hospitals and departments (Annex Table 11).
Box 1: Interpretation of challenges faced on the IFMS
a) Downtime means the IFMS system is off or unstable due to lack of Network connectivity
reliability; or Intermittent power – load shedding, breakdowns or surges
b) The system is slow responding to commands especially at peak hours of the day and especially
since integration with IPPS
c) Supplier Duplication of supplier names
d) Inadequate Knowledge where staff are not given proper training by MFPED; those trained are
transferred and new recruits are not IFMS compliant; and when budget codes are not followed
and activities are lumped together. However, a comprehensive training programme is in place
(Formal training, on-job training through peer interaction, dedicated technical support, a
functional service desk and manuals) and this issue should be addressed effectively.
e) Bank transactions: where Banks take long to effect payments even when the payer has approved
a payment; payments missing from the system but cannot be traced since payees have no
mechanism of acknowledging receipt; and the return in aggregate formats of bounced payments
making it difficult to disaggregate accounts. However it was also reported that in Electronic
Payments Systems the principal of irrevocability applies (If a payment is not unapplied within 48
hours it is deemed to be paid). In addition, Bank statements are available on a daily basis through
the interface with Bank of Uganda and Commercial banks.
f) Maintenance: limited maintenance due to inadequate technical personnel and funds for hardware
maintenance (computers, printers, LAN); as well as consumables. However, it was noted that
IFMS has service level agreements for maintenance of all core equipment. In addition, there is a
recurrent budget line item for all IFMS votes to cater for maintenance of IFMAS related
equipment.
g) Passwords: that require mandatory change every month make it difficult for in-frequent users.
Password expiry after 30 days is a deliberate security policy to enhance IFMS security. On
expiry, IFMS immediately prompts the user to change their password. When passwords expire
without change; the Password recovery process is very lengthy.
h) Help desk: The IFMS help desk is slow or even non-responsive to user queries. There is no
general feedback/dialogue between the IFMS users and its management. Communications are one
on one and never a workshop to hear from users as a group or a dialogue between users and the
Ministry of Finance.
i) Limited Logins: There is a limitation on the number of people that can login simultaneously
which delays work especially at times when all officers are on site to clear transactions. However,
IFMS was reported to have 2000 concurrent user licenses and statistics from the system indicated
that at any one time the number of concurrent logins does not exceed 500.
Source: Compiled from field responses
24 | IFMS STUDY REPORT – APRIL 2015
a) Downtime
The most frequent reported cause for downtime was poor network connectivity (78%);
followed by intermittent power; and ineffective computers that either freeze or hang-up in
that order. It was also noted that the systems upgrades also cause downtime although it is to a
limited extent. For institutions that were noted to use the IFMS on a daily basis, downtime
had grave implications for their operations.
Box 2: Examples and effects of system break downs
IFMS Upgrade: delayed funds transfer from the Central Government to the districts in the Roads
Sector during Q1 of FY 2013/14. This happened despite the 30 days advance notice to users to plan
for the upgrade from R11 to R12.
In the Agriculture sector, the frequent power outages, IFMS breakdown and breakdown of standby
generators were noted as contributory factors to IFMS non functionality. Slow funds disbursements
due to frequent IFMS breakdown and non-functionality during the first three quarters of FY
2013/14 were reported under the National Agriculture Advisory Services (NAADS) programme in
Mbarara District. In Bugiri District delays in making contract decisions/requisition and local
purchase orders were a result of non-functionality of the IFMS in some periods (BMAU 2014,
Annual Monitoring Report FY 2013/14).
b) Staff Competency
In terms of user competency, 84% of the respondents reported having received IFMS
training19. Majority (86%) reported that the training had equipped them with user skills and
many (80%) could resolve problems on their own using manuals.
c) Other Issues
The qualitative responses also noted inappropriate distribution of roles that may be affecting
the use of IFMS operations.
19
i.
Internal Auditors:
Internal Auditors have only viewing rights. The role of the internal audit is to review
and advice management on adequacy of internal controls, however, there is no
mechanism to facilitate immediate action on the system. Although pre-audits are not
acceptable, internal auditors are answerable for many undesirable institutional
transactions.
ii.
Heads of Departments:
Heads of departments (H.O.Ds) are not on IFMS yet they are the key decision makers
for their respective departments. Payment approval and control is key output for
H.O.Ds on the IFMS. However, it was noted that some votes had already requested
for IFMS access for their heads of departments. Examples include Ministry of
IFMS training was part of wider capacity building initiatives. IFMS training initiatives include;

Maintenance of a well equipped full time in-house training facility on Nasser Road.

Training of Trainers, and

Provision of elaborate IFMS user Manuals,
25 | IFMS STUDY REPORT – APRIL 2015
Finance, Planning and Economic Development; Ministry of Water and Environment;
KCCA and 14 local governments.
The BMAU reports identified a critical issue that the respondents did not mention. The
Donor project information was not readily available on the IFMS which was constraining
financial analysis. In FY 2011/12, the Energy Sector noted that release and expenditure data
for some capital development projects financed by donors was not captured on the system,
making analysis of financial performance difficult.
On a positive note, donor funded projects are being rolled out onto the IFMS.
3.3 The level of integration and scalability with other systems
As was noted earlier, institutions are using many other systems. This study assesses the extent
to which the IFMS is interfacing with other systems.
Table 3.3: Integration with selected systems
System
Level of interface
OBT
The IFMS does not interface with the OBT.
ASYCUDA (URA)
The IFMS does not interface with ASYCUDA. Balances
of revenue collected by URA are received via a file sent
through a secured link
Public
Procurement Does not interface with the IFMS
Management System (PPMS)
Integrated Personnel and Payroll The interface is partial and involves a lot of human
System (IPPS)
intervention. It is a one way link whereby invoices for
salary payment are created into the IFMS from an IPPS
output file.
Solomon System
Does not interface with the IFMS
BBS Connect20
Does not interface with the IFMS
Sun systems
Does not interface with the IFMS
Source: Auditor General
It was therefore noted that although MDAs were using many other systems, none were
interfacing with the IFMS. However, some were reported to be complementary to the IFMS.
These include the OBT, IPPS. BBS Connect and PPMS.
20
BBS is a complimentary system that is used by entities which have no access to IFMS
26 | IFMS STUDY REPORT – APRIL 2015
Box 3: Experience of IFMS Interface
IFMS Interface with Bank of Uganda Systems
It was reported that there is a server housed at the Bank of Uganda (BOU) that receives
through secure files transfer protocol (SFTP) transaction files from the Ministry.
BOU – IT designated staff run scripts that pick the files from the server at given intervals
between 12:00 mid night to 3:00 pm. The files are queued and handed off for the next
clearing session. There being two clearing sessions. Files that are sent after the second
clearing session yet reading the day’s date will be thrown out the next day because of wrong
date.
Treasury Single Account arrangement requires that funds are released according to needs. It
has, however, been observed that there are instances around mid-day when both the funding
and paying files are sent and get processed at the same time. If the paying file gets
processed first, payments against accounts that have not yet been funded will fail due to
insufficient balance. There will be delay because the Ministry has to resend the payment
file i.e. if done on the same day, otherwise, the whole procedure is done again the following
day.
Salaries processing
It was also reported that salary files had been streamlined with the decentralization of salary
processing. Delays were however attributed to files containing wrong formats, dates or
data.
Local government (LG) salaries were batched by district while Ministry of Finance
aggregated. This meant that even if districts are in the same region, their salaries were
processed independently.
It was also highlighted that LG regularly sent files with no data and did not respond or were
slow in responding to feedback which is given regularly.
Source: Bank of Uganda
Scalability
To enable scalability and functionality, new modules are accommodated to match changing
user needs; many current functions were implemented as additions to the original solution.
For example, Government is currently rolling out a Fixed Asset module as an additional
functionality.
3.3.1 Challenges Related to Integration and Scalability
OBT
The OBT is a standalone data system based on Microsoft access. Output files are run from
OBT on budget balances into Ms Excel from which, the budget balances are journalised and
uploaded into the IFMS via a web ADI tool. The tool is being upgraded into a web-based data
processing system for which interface with IFMS is one of the key deliverables to the
contract.
27 | IFMS STUDY REPORT – APRIL 2015
IPPS
IPPS coverage is not yet 100% and there is only partial integration.
Solomon System
This was a procurement system
ASYCUDA
ASYCUDA is an automated system specifically used for customs data collection and
maintenance rather than financial management.
3.3.2 Constraints faced by Government in rolling out of the IFMS
A number of constraints were reported to be limiting the IFMS roll out by government and
they include:






Lack of IT infrastructures in most of the rollout entities especially the local
governments
Lack of readily available electricity for some local governments,
Inadequate capacity of users to operate in an IT environment,
High sustainability costs of the IFMS
Increasing number of districts that makes the rollout process a moving target
Limited local service providers with the capacity to address IFMS needs hence
resorting to expensive international providers.
28 | IFMS STUDY REPORT – APRIL 2015
CHAPTER 4: CONCLUSIONS AND RECOMMENDATIONS
4.1 Conclusions
The IFMS is a robust financial management system that has effectively worked in many parts
of the world. In Uganda the expected outcomes have not been fully achieved because of the
de- incentivised human resource. It was evident that institutions were using various systems
for financial transactions. Although the other financial systems were said to be
complementary, some transactions that could be executed on the IFMS were still off the
system. All of these systems are not interfacing with the IFMS thus limiting the latter’s level
of effectiveness. To that effect in instances of uploading information from other systems onto
the IFMS, the human element determines the pace and reliability of operations.
Except for the General Ledger module, all Modules in the IFMS are fairly used. Although
largely new on the IFMS, it was the local governments that exhibited highest application of
the modules. However, it was noted that the Budgeting Module had been replaced by the
OBT and some inconsistencies were reported between the IFMS and OBT budget
information.
There has been some improvement in financial management as financial reporting had
improved in terms of timeliness and accuracy. In addition, the percentage of institutions
(Ministries, Departments, Agencies and Local Governments) with un-qualified audit
opinions, increased slightly from 47% to 50% over the review period. However, the quality
of financial statements remains poor given the persistent high number of qualified audit
opinions among institutions connected to the IFMS. For Ministries and Departments the
IFMS related reasons for the qualified opinions was increasing despite the fact that the
system had capabilities to containing such problems.
Although the IFMS was reported to have adequate controls at different user levels, it could
not ensure that annual financial statements are free of mis-statements and errors. In addition it
was also noted that the IFMS could detect patterns of doubtful payments- all of which were
influenced by the staff on the system. Over the review period domestic arrears and over
expenditures continued to be unchecked. These were largely due to budgetary indiscipline.
Since most IFMS users had been trained, the limitation in capacity may not wholly explain
the persistent weak financial management practices.
The main challenges faced on the IFMS were downtime and inadequate knowledge. The most
frequent reported cause for downtime was poor network connectivity, intermittent power; and
ineffective computers respectively.
Inappropriate distribution of roles was reported as affecting the implementation of IFMS
operations. For example the limited access by Internal Auditors and heads of departments
limited effective application of the IFMS in those areas. On the other hand, the fact that even
transaction of small monies needed the approvals of Accounting Officers, who were often off
their desks, also affected timeliness of IFMS operations.
29 | IFMS STUDY REPORT – APRIL 2015
The operational constraints of the IFMS were also hampering planned rollouts across all
government institutions.
4.2 Recommendations
There is a growing need to have stronger controls and management of public resources. To
that effect the IFMS cans be strengthened further through the following interventions:
1. MFPED and National Information Technology Authority (NITAU) should fast track the
national transmission backbone infrastructure (NBI) project; this development would
strengthen the network connectivity especially in light of the increasing number of users
on the IFMS.
2. MFPED should institute incentives and penalties to minimize human errors by officials
working on the IFMS and interfacing systems.
3. MFPED should institute appropriate penalties for officials using other financial
management systems whose functions are available on the IFMS.
4. MFPED should facilitate IFMS interfaces with other systems that institutions must
continue using especially where the external funding requires a separate accounting
system
5. The Accountant General’s Office should scale up the IFMS to show individual
outstanding advances in lieu of further authorizations of funds to officials. This would
minimize qualifications by auditors on grounds of unaccounted funds.
6. MFPED should continue with refresher IFMS training programmes for already connected
institutions to cater for staff redeployments.
7. MFPED and Ministry of Public Service should include financial management
performance indicators for Accounting Officers. For example: Levels of over expenditure
in a financial year; and Levels of new arrears committed in a financial year.
8. MFPED should review the distribution of roles on the IFMS within institutions to ensure
optimal application by various officials.
9. MFPED should enforce IFMS period closures after specified timeframe for example
quarterly. This would eliminate changing balances post period.
30 | IFMS STUDY REPORT – APRIL 2015
REFERENCES
ACE International Consultants: 2013. Uganda Local Government (LG) PEFA Consolidated
Report. Report on Public Expenditure and Financial Accountability (PEFA), Kampala.
Accountability Sector- Strategic Investment Plan (ASSIP) 2014-2019 “Transparency and
Accountability in public service delivery”.
Delta Partnership and Reev Consult, 2013. Mid-Term Review of the National Development
Plan: Political Economy Thematic Report, August 2013- National Planning Authority.
Ephrem Asebe, Dan Mambule (2006), World Bank and Ministry of Finance, Planning and
Economic Development; Evaluation Report: The Integrated Financial Management System
(IFMS) Implementation in Uganda
Florence Kuteesa, Ishamael Magona, Maris Wanyera and Wokadala James. Journal on
Budgeting Volume 6- No. 2, “A Decade of Budget Reform and Poverty Reduction”
Guidelines on the Management of the Decentralized payroll
Lawrence Semakula; Robert Muwanga (2012), Country Learning Notes, Uganda:
Implementing an Integrated Financial Management System and the Automation of the
Budget process
Makara, S (2009) Decentralization and Urban Governance in Uganda unpublished PhD
Thesis University of Witwatersrand
Ministry of Finance, Planning and Economic Development (2008): Public Financial
Management Performance Report 2008- Kampala
MFPED (2012): Central Government Public Expenditure and Financial Accountability
Assessment Report, September 2012- Kampala.
MFPED (2012), Budget Monitoring and Accountability Unit Q2/Q3 FY 2012/13 Monitoring
Report
MFPED (2012), Annual Budget Monitoring Report FY 2011/12, Kampala Uganda
MFPED (2013), Budget Monitoring and Accountability Unit Q3 FY 2012/13, Kampala
Uganda
MFPED (2014), Budget Monitoring Report Quarter One FY 2013/14, Kampala, Uganda
MFPED (2014), Budget Monitoring Report Quarters Two/Three FY 2013/14, Kampala
Uganda
MFPED (2014), Annual Budget Monitoring Report FY 2013/14, Kampala Uganda
31 | IFMS STUDY REPORT – APRIL 2015
MFPED, Internal Audit Reports Financial Years 2008-2012/13
MFPED, “The Ugandan Debt Strategy, December 2007”
MFPED, 2014, Uganda Public Financial strategy, 2011/12 – 2016. Consolidating,
Widening and Deepening PFM Reforms with a focus on Sequencing. Kampala.
MFPED, Uganda Public Financial strategy, 2014–2018: Consolidating, Widening and
Deepening PFM Reforms with a focus on Sequencing. Kampala
National Planning Authority, March 2010. “The National Development Plan, 2010/112014/15”
Office of the Auditor General: Annual Reports of the Auditor General for the Years Ended
30th June; 2008- 2013, Volumes 1, and 2.
Office of the Auditor General Annual Report of the Auditor General for the year ended 30th
June, 2009. Local Authorities (Kampala 2009)
Office of the Auditor General Annual Report of the Auditor General for the year ended 30th
June, 2010. Local Authorities (Kampala 2010)
Office of the Auditor General Annual Report of the Auditor General for the year ended 30th
June, 2011. Local Authorities (Kampala 2011)
Office of the Auditor General Annual Report of the Auditor General for the year ended 30th
June, 2012. Local Authorities (Kampala 2012)
Office of the Auditor General Annual Report of the Auditor General for the year ended 30th
June, 2013. Local Authorities (Kampala 2013)
The Accountability Sector- Strategic Investment Plan (ASSIP) 2014-2019 “Transparency and
Accountability in public service delivery”.
The Constitution of the Republic of Uganda, 1995(Amended)
The Local Government Act, CAP. 243
The Local Government and Accounting Regulations, 2007
The Local Government and Finance and Accounting Manual, 2007
The Public Finance and Accountability Act-2003
32 | IFMS STUDY REPORT – APRIL 2015
ANNEXES
Annex 1: List of Sites Visited during the IFMS Study
S/No
Ministries
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
Ministry of Energy and Minerals
Ministry of Internal Affairs
Ministry of Water and Environment
Ministry of Health
Ministry of Education and Sports
Ministry of Information Communication and Technology
Ministry of Justice and Constitutional Affairs
Ministry of Public Service
Ministry of Lands, Housing and urban Development
Ministry of Agriculture, Animal Industry and Fisheries
Ministry of Finance, Planning and Economic Development
Ministry of Local Government
Hospitals
Mulago Referral Hospital
Butabika Referral Hospital
Mbale Referral Hospital
Lira Referral Hospital
Departments and Agencies
Uganda Human Rights Commission
National Agriculture Research Organization (NARO)
Local Government Finance Commission
Diary Development Authority
Uganda National Road Authority
Uganda Prisons
Public Service Commission
Kampala Capital City Authority
Directorate of Public Prosecution
Uganda Cancer Institute
National Agricultural Advisory Services (NAADS)
Uganda Human Rights Commission
Judicial Service Commission
Health Service Commission
National Forestry Authority
Uganda Land Commission
Education Service Commission
Public Procurement and Disposal of Assets Authority
Uganda Aids Commission
Inspectorate of Government
Local Governments
Mubende DLG
Kumi DLG
33 | IFMS STUDY REPORT – APRIL 2015
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
Luwero DLG
Ntungamo DLG
Nakasongola DLG
Kitgum DLG
Bundibugyo DLG
Kisoro DLG
Iganga DLG
Pader DLG
Tororo DLG
Soroti DLG
Kabale DLG
Arua DLG
Wakiso DLG
Ntungamo DLG
Nebbi DLG
Jinja DLG
Bushenyi DLG
Jinja MC
Lugazi TC
Hoima MC
Mukono MC
34 | IFMS STUDY REPORT – APRIL 2015
Annex 2: List of People interviewed during the IFMS Study
Name
Betty Kasimbazi
Ambrose Promise
Andrew Arubariho
James Tibenkana
Lawrence Semakula
Godfrey Ssemugooma
Aiden Rujumba
Norbert Okello
Title
Under Secretary
Asst. Commissioner
Head Procurement
Head Planning
Accountant General
Commissioner
Asst. Commissioner
Deputy Head Training
James Wokadala
Commissioner
Ishmael Magona
Fixon Okonye
Charity Mugumya
Herbert Rusoke
Racheal Magoba
Waiswa Bageya
Carolyne Kakuba
Joseph Nabwii
Alex Atwijukire
Cornelia.K.Sabiiti
Jimmy Mugisa
Martin Byamukama
Obasin Richard
Richard Kalule
Commissioner
Director
Director
Asst. Commissioner
Manager.
Secretary Inspectorate of
Government
Senior Internal Auditor
Head of Finance
Head Procurement
Executive Director
Head Finance
Head Procurement
Accountant
Planner
Adam Babale
Patience Akatukunda
Vicky Marcelina
Ashaba Jimmy
Musinguzi Stephen
Micheal Bithum
Jaffar Kawooya
Justus Owamazima
Julius Mwebembezi
Director Planning
Head Procurement
Accountant
Director
Internal Auditor
Procurement Officer
Internal Auditor
Accountant
Director Research
Byakusaaga Bisobye
Charles Onen
Christopher Ndyareeba
Alfred Lapyem
Dr. Ambrose Agona
Head Planning
Principal Accountant
Internal Auditor
Head Procurement
Acting Director
Elizabeth Atuhaire
Senior Accounts assistant
Department
Institution/Agency
Finance and
Administration
Financial
Management
Services
Budget
Directorate- PAD
Budget
Directorate- ISSD
Internal Audit
Banking
Process Systems
Ministry of Finance,
Planning and
Economic
Development
Bank of Uganda
Uganda Revenue
Authority
Administration
Inspectorate of
Government
Administration
Finance
Procurement
Finance
Planning
Research, Policy
and Planning
Procurement
Fin. and Admin
Audit
Procurement
Audit
Accounts
Planning
Policy and
Planning
Finance
Audit
Procurement
Administration
Directorate of
Finance
35 | IFMS STUDY REPORT – APRIL 2015
PPDA
Local Government
Finance Commission
Judicial Service
Commission
Ministry of Justice and
Constitutional Affairs
NARO
Name
Mr. Stephen Ojangole
Ms Mary Theresa
Kiggundu
Mr. Godfrey Richard
Babalenda
Wodulo Geofrey
Nalweyiso Regis
Mr. Fred Mayanja
Engineer Ronald Kato
Kayizzi
Mr. Alex Kakooza
Rehema Omar
Arthur Ssemalulu
Mr. Kugoza Denis
Kateeba
Mr. Godfrey Mugisha
Masereka
Ms Amony Mary
Christine
Mr. Ochengel Ismael
Aryemo Agnes
Mr. Okot Fred
Mr. Leru Andrew
Mr. Adonga Brian
Wilfred
Mr. Ocan jimmy
Mr. Ojara Pons Obol
Dr. Ocen William
Mr. Odepe Simon
Mr. Bossa Robert
Mr. Onyait Patrick
Mr. Peter Emong
Dr. Jolly K. Zaribwende
Twine Hope Rebecca
Mr. Magezi Peter
Mr. Mugabo Clovis
Mr. Samuel Semanda
Title
Principal planning
Officer
Director Finance
Acting Head PDU
Asst. Procurement
Officer
Senior Accountant
Asst. Commissioner
Assistant Commissioner
Under secretary
Manager
Asst. Procurement
Support Officer
Accountant
Officer/Acting head
Planning
Department
Planning Unit
Finance
Directorate of
Corporate services
Procurement and
Disposal Unit
Fin. and Admin/
Accounts
Planning
Agric. Infrast. and
Water Devpt
Fin. and Admin
Fin. and Admin
Procurement and
Disposal
Finance
Department
Planning,
M&Evaluation
Acting Head Procurement
Chief Administrative
Officer (CAO)
Senior Accounts assistant
Ag. Senior Finance
officer
CAO
Administration
Senior Accounts assistant
Senior Internal Auditor
Senior Accounts assistant
Ag Hospital Director
Acting Accountant
Procurement Officer
Finance
Internal Audit
Finance
Administration
Accounts
Procurement
Internal Audit
Unit
Fin. and Admin
Administration
Planning Unit
Fin. and Admin
Internal Auditor
Director
Executive Director
Senior planning Officer
Accountant
Principal procurement
Officer
Commissioner
Agriculture planning
Institution/Agency
Administration
Health
MAAIF
NAADs Secretariat
Kitgum District
Finance
Administration
Pader District
Lira District Regional
Referral
Dairy Development
Authority
Fin. and Admin
Planning
36 | IFMS STUDY REPORT – APRIL 2015
MAAIF
Name
Dr. Samuel K.Mugasi
Department
Administration
Institution/Agency
NAADS
Dr.Rose
Nassali Permanent Secretary
Administration
Lukwago
Jimmy Lubwama
Assistant Commissioner Head of Finance
Finance
Nelson Wanambi
Commissioner Planning
Planning
Ministry of Education
and Sports
Bwayo Patrick
Oryema Charles
Mr. Kagoda
Baker Akantambira
Opolot Simon Peter
Lawrence Tabaluka
Debroah Nabukeera
Aweebwa
John Geoffrey Mbabazi
Nsubuga Lawrence
Sarah Mabangi
Title
Executive Director
Principal
Procurement Procurement
Officer
Ag.
Assistant Internal Audit
Commissioner Audit
Permanent Secretary
Assistant Commissioner Finance
Finance
Commissioner
Planning
Procurement officer
Procurement
Head Internal Audit
Internal Audit
Ministry of Internal
Affairs
Secretary to commission
Head of Finance
Principal Policy Analyst
Education Service
Commission
Owino Emmanuel
Rasul Tumwine Adigah
Ngolobe Amos
Head of Procurement
Head Internal Audit
Deputy Director
Michael Okwakol
John Machumbi
Bamulange Lillian
Osingilio Justine
Head of Finance
Head of Planning
Head of Procurement
Head Internal Audit
Kilama Robert
Hope Olive Nakyanzi
Jackson Mushabe
David Saluse
Kayemba Margaret
Accountant
C.A.O
C.F.O
District Health Officer
Accounts Assistant
Waidhuuba Jofram
Deputy Town Clerk
Finance
Planning
Procurement
Internal Audit
Directorate of
Public Prosecution
Accounts
Planning
Procurement
Senior Internal
Auditor
Accounts
Directorate of Public
Prosecution
Jinja District
Accountant
Planning
Administration
Jinja Municipality
Waibi George Stephen
Kyangwa Mercy
Mirembe Jemima
Kasadha
Head of Finance
Finance
Planner
Planning
Accounts
Assistant Accounts
Health
37 | IFMS STUDY REPORT – APRIL 2015
Name
Mukasa Joseph Mayira
Nabwire Robinah
Samanya Abdul
Magemeso Richard
Charles Esimu Okuraja
Waliyah Nalweyiso
Samuel Otuba
Meke Jane Margaret
Title
C.A.O
C.F.O
Head Natural Resources
Office
Accounts Assistant
Undersecretary (Ag. PS)
Senior Accountant
Commissioner
Principal Procurement
Officer
Joseph Eyatu Oriono
Olaunah Emmanuel
Ourum
Undersecretary (Ag. PS)
A. Kibuuka
Turyomurugyendo
William
Erukwaine Godfrey
Head of Finance
Head of Planning
Pade Joseph Walter
Asst. Commissioner
Abdul Mubiru
Nyamusana Julian
Mildred Martha
Namwiira
Shaineh Zaidi
Bwogi Justin
Mugumya J Albert
Tabaro Remigius
Walter Jokkene
Oluk Charles
Joseph Balisanyuka
Wandera Peter
Dr. John Opolot
Olupot Oumo Joseph
Opolot Agwang
Consolate
John Nyakahuma
Opolot Justine
Eyudu Patrick
Head of Finance
Accountant
Head of Planning
Margaret Arago
Dr. Wanume Benson
Head of Procurement
Head of Procurement
Executive Director
Under secretary
Accountant
Head of Planning
Head of Procurement
CAO
Chief Finance Officer
District Health Officer
Accounts Assistant
Senior Accountant
CAO
Chief Finance Officer
District Production
Officer
Accounts Assistant
Hospital Director
Department
Administration
Accounts
Institution/Agency
Iganga District
Internal Audit
Administration
Accounts
Policy and
Planning
Procurement
Rural Water and
Sanitation
Administration
Accounts
Planning and
Quality Assurance
Procurement
Officer
Urban
Development
Fin. and Admin
Finance
Corporate
Planning
Procurement
Secretary to ULC
Administration
Accounts
Planning
Procurement
Administration
Accounts
Health
Planning
Accounts
Administration
Accounts
Production
Internal Audit
Administration
38 | IFMS STUDY REPORT – APRIL 2015
Ministry of Water and
Environment
Ministry of Lands,
Housing and Urban
Development
National Forest
Authority
Uganda Land
Commission (ULC)
Kumi District
Soroti
Mbale Hospital
Name
Belly Sam Okwir
Dr. Asuman Lukwago
Wycliff Mwambu
Edward K. Higenyi
Peter Mulindwa
Ssebabenga
Sulaiman Kasozi
Henry Mukoza
Edith Kiregga
Robert Kaggwa
Dr. Juliet Nakku
Joel Muyinda
Emily Birekeyaho
David Isooba
Ronald Ojambo
Edward kayiwa
Charles Kiberu
Fredrick William
Kisaakye
William Kakinda
Matovu
George Eustace
Gakwandi
Godfrey Segawa
Abdu Kizza
Jackson Orem
Christine Ondoa
Achom Agatha Mutenyo
Dennis Busobozi
Wangalwa Moses
Katwesigye Elizabeth
Ekachelan Esau
Aitaa Sam
Opima Natal
Anguyo Richard
Banya Emmanuel
Kambumbi Annet
Mugano Felix
Title
Senior Accountant
Permanent secretary
Head of finance
Senior procurement
officer
GAVI project accountant
Department
Accounts
Administration
Accounts
Procurement
CAO
District planner
Head finance
Head procurement
Acting ED
Senior Hospital
administrator
Senior accountant
Head stores department
Head of procurement
Head of finance
Administration
Planning
Accounts
Procurement
Administration
Planning
CAO
Head of production unit
Administration
Production
Head planning
Planning
Director Chief
Administrative Officer
Chief Finance Officer
District health officer
Senior accountant
Director Uganda Cancer
Institute
Director General
Administration
Luwero DLG
Accounts
Health
Accounts
Administration
Uganda Cancer
Institute
Director
acting head of PlanningHead of Procurement
Accountant
CAO
Chief Finance Officer
Accounts assistant
Head of Procurement
Town CLERK
Principle Treasurer
principal Health inspector
Institution/Agency
Ministry of health
Accounts
Accounts
Procurement
Procurement
Accounts
Administration
Finance and
Accounts
M$E Specialist
Accounts
Administration
Finance
Planning
Procurement
Administration
Finance
Health
39 | IFMS STUDY REPORT – APRIL 2015
Nakasongola DLG
Butabiika Hospital
Mubende DLG
Uganda Aids
Commission
Arua
Hoima Municipality
Name
Karamagi Yahaya
Isingoma Robert
Alia Seraphine
Uroma Alex
Okecha Linus
Angeyo Alfred
George Bashaija Sabiiti
Kityo Collins
Kiboome Yusuf
Lwanga Rose Lillian
G.T Mwesigye
Muhwezi Robert
Musimenta Jacqueline
Dennis Kakeeto
Noel Oyungrowth
Ejang Margaret
Eng. Okiror James
Ssambwa Godfrey
Lawrence Pariyo
Peter Kabanda
Kwesiga Braza
Benjamin Kumumanya
Naboth Namanya
Joweria Kamariza
Yerusa Nyangoma
Dr. Jimmy Pat
Saamanya
Robert Bataringaya
Mago-Nsubuga Yusuf
Robert Sebugere
Deo Aeloi E
Julius R kabugo
Moses N Bwire
Doreen Akatuhwera
Edson Masereka
John Katotoroma
Bannex Niwamanya
Didas Amwesiga
James Banyenzaki
Allyson Kubiriba
Title
Senior Accounts
Assistant
Senior Accountant
CAO
Head
Chief Finance Officer
Senior Account Assistant
Under Secretary
Head of Planning
Head of Finance
Head of Procurement
Secretary to the
Commission
Senior Accountant
Procurement Officer
Accountant
Head of Finance
Ag. Executive Director
Director of Procurement
Ag. Director
Accountant
Accountant
Undersecretary
Commissioner
Principal Accountant
Head Procurement
Permanent Sec
Head Planning
Head of Finance
Internal Audit
Head Procurement
Director
Director
Manager
Manager
D. CAO
CFO
Planner
Stores assistant
Accounts Assistant
Department
Finance
Finance
Administration
Internal Audit
Administration
Community
Service
Fin. and Admin
Planning
Finance
Procurement
Administration
Finance
Procurement
Finance
Planning
Finance
Administration
Procurement
Planning
Finance
Finance
Administration
Planning
Finance
Procurement
Administration
Planning
Finance
Internal Audit
Procurement
Treasury Services
Internal Audit
Procurement
Strategy and B
Devt
Administration
Finance
Planning
Procurement
Finance
40 | IFMS STUDY REPORT – APRIL 2015
Institution/Agency
NEBBI
Health Service
Commission
Uganda Human Rights
Commission
Uganda National
Roads Authority
Ministry Of Foreign
Affairs.
Ministry Of
Information And
Communications
Technology
Kampala Capital City
Authority
Ntungamo District
Name
Abert Matsiko
Julius Mujuni
Joseph. B. Twongyeirwe
Herbert Mugume
Dr. Patrick Tusiime
Wilson Tibugyenda
Richard Semucyo
Godfrey Kagaba
Uzabakiriho
Stephen Urayeneza
Dr. Robert Nsabayunva
Paul Mubiru
Joseph Odoi
Betty Nanyondo
Ibrahim Mukwaya
Ayo Dennis Francis
Title
CAO
CFO
Procurement
Accounts Assistant
Distr. Health Officer
CAO
CFO
Senior - Accountant
Accounts Asst
Distr. Health Off
Director
Principal Accountant
Principal Internal Auditor
Senior Accountant
Head of Procurement
Aggrey Aturwaniriire
Ahimbisibwe Innocent
Racheal Birimumaaso
Jjuuko
Dr. Kkonde Anthony
Najjuma Christine
Ssegawa
Planner
Town Clerk
Justine Eriongu Ariku
Principal Accountant
Accountant
Principal Medical Officer
Principal Assistant
Secretary
Department
Administration
Finance
Procurement
Finance
Health
Administration
Finance
Finance
Finance
Health
Fin. and Admin
Accounts
Audit
Accounts
Procurement
Policy and
Planning Unit
Administration
Accounts
Health
Administration
Stephen Mugenyi
Principal Economist
Policy and
Planning
Mutabwire Patrick
David Kigenyi
Naluwayiro
Hood Nsubuga
Juma Mwesigwa
Ag Permanent Secretary
Administration
CAO
CAO
CFO
Administration
Lilian Nakamatte
CAO
Abias Asiimwe
CFO
Institution/Agency
Kabale District.
Kisoro District
Ministry of Energy
and Mineral
Development
Uganda Prisons
Service
Mukono Municipal
Council
Public Service
Commission
Ministry of Trade,
Industry and Co-ops
Ministry of Public
Service
Ministry of Local
Govt
Wakiso District
Bundibugyo
Bundibugyo
Bushenyi
41 | IFMS STUDY REPORT – APRIL 2015
Annex 3: Sampling design
Survey Institutions
This was a cross-sectional institutional -based study conducted to assess effectiveness and
efficiency of the Integrated Financial Management System (IFMS) in Government Ministries,
Departments and Agencies.
Sample frame
The sampling frame used for the IFMS study was the list of Ministries, Autonomous
organisations, Local Governments, Referral Hospitals, Municipalities and Town councils
using IFMS. These included 40 Local Governments (14 tier 1 and 26 tier II), 18 Ministries
and 44 Autonomous organisation.
Sample Design and Sample Size
The survey was stratified into 5 stratums, namely Tier 1 sampled DLG, Tier 2 sampled DLG,
Special Areas, Semi-Autonomous Institutions and Ministries. For special areas, all
institutions were included in the sample while a random sample was selected from other
stratums as shown below.
Table: Allocation and sampled Institutions
Tier 2 sampled DLG
Tier 1 sampled DLG
Special Areas
Semi autonomous Institutions
Ministries
Number of Institutions
26
14
10
44
18
42 | IFMS STUDY REPORT – APRIL 2015
Sampled Institutions
10
9
8
20
12
Annex 4: Statistical Tables
Annex Table 1: Type of respondents
MALE
Number
%
Department
Accounts department
Administration Depart
Accounting Officer
Procurement Department
Audit Department
Others department
Planning Department
Total
78
22
19
27
11
15
27
199
39.2
11.1
9.6
13.6
5.5
7.5
13.6
100
FEMALE
Number
%
26
9
2
7
5
1
3
53
49.1
17.0
3.8
13.2
9.4
1.9
5.7
100
Total
Number
%
104
31
21
34
16
16
30
252
41.3
12.3
8.3
13.5
6.4
6.4
11.9
100
Source: Field findings
Annex Table 2: Duration of using IFMS by entity and department
Type of Entity
Ministry
Agency
Statutory Department
Local Government
Referral Hospital
Department
Accounts Department
Administration Department
Accounting Officer
Procurement Department
Audit Department
Others Department
Planning Department
Total
Less Than
One Year
One-Two
Years
Two - Five
Years
Five
Years
and
Above
Total
6.3
6.1
6.3
6.1
0.0
14.6
21.2
18.8
50.0
46.2
27.1
48.5
37.5
36.6
38.5
52.1
24.2
37.5
7.3
15.4
100
100
100
100
100
8.0
3.7
11.1
0.0
6.3
0.0
0.0
5.8
24.0
22.2
50.0
44.4
31.3
72.7
33.3
32.2
39.0
51.9
27.8
25.9
25.0
27.3
44.4
36.5
29.0
22.2
11.1
29.6
37.5
0.0
22.2
25.5
100
100
100
100
100
100
100
100
Source: Field findings
43 | IFMS STUDY REPORT – APRIL 2015
Annex Table 3: Use of IFMS between 2008 and 2014
Type of Entity
Yes
Ministry
83.3
Agency
75.5
Statutory Department
91.7
Local Government
97.8
Referral Hospital
94.1
Department
Accounts Department
100.0
Administration Department
96.8
Accounting Officer
100.0
Procurement Department
94.1
Audit Department
100.0
Others Department
75.0
Planning Department
30.0
Source: Field findings
Annex Table 4: IFMS Modules being used by institution by department
Type of Entity
Ministry
Agency
Statutory Department
Local Government
Referral Hospital
Accounts Department
Administration
Department
Accounting Officer
Procurement
Department
Audit Department
Others Department
Planning Department
Total
Receivables
module
Payables
module
Purchasing
module
Cash
management
module
70.0
59.2
83.3
89.9
83.3
80.0
73.5
88.9
94.4
83.3
65.0
59.2
80.6
87.6
77.8
76.7
65.3
86.1
82.0
83.3
6.7
12.2
5.6
7.9
5.6
100
100
100
100
100
86.5
93.3
82.7
89.4
3.8
100
74.2
83.9
74.2
80.6
9.7
100
85.7
95.2
90.5
90.5
0.0
100
73.5
82.4
73.5
67.6
8.8
100
81.3
62.5
56.7
77.8
81.3
75.0
63.3
85.3
68.8
50.0
56.7
75.0
81.3
43.8
56.7
78.2
12.5
12.5
20.0
7.9
100
100
100
100
Source: Field findings
44 | IFMS STUDY REPORT – APRIL 2015
General
ledger
module
Total
Annex Table 5: Percentage of Respondents that received training and area of training
Basic
computer
literacy
Budgeting
module
Receivables
module
Payables
module
Purchasing
module
Cash
management
module
General
Ledger
Systems
navigation
Security
considerations
Type of Entity
Ministry
26.7
36.7
46.7
55.0
60.0
38.3
46.7
31.7
25.0
Agency
36.7
42.9
40.8
53.1
51.0
51.0
40.8
22.4
22.4
Statutory Dept
22.2
44.4
44.4
58.3
58.3
44.4
50.0
30.6
22.2
Local Govt.
52.8
50.6
56.2
71.9
59.6
56.2
50.6
39.3
34.8
Referral Hosp.
61.1
44.4
55.6
61.1
44.4
38.9
50.0
27.8
22.2
Department
Accounts
50.0
64.4
75.0
84.6
69.2
76.9
74.0
39.4
36.5
Administration
35.5
41.9
45.2
64.5
54.8
38.7
41.9
38.7
29.0
Accounting
Office
57.1
47.6
42.9
61.9
38.1
38.1
42.9
33.3
14.3
Procurement
23.5
11.8
14.7
23.5
76.5
8.8
11.8
20.6
17.6
Audit
37.5
56.3
75.0
75.0
75.0
75.0
75.0
31.3
25.0
Others
31.3
12.5
18.8
43.8
25.0
18.8
6.3
31.3
31.3
Planning
20.0
23.3
10.0
23.3
13.3
10.0
13.3
13.3
13.3
Total
39.7
44.4
49.2
61.5
56.7
48.0
47.6
32.1
27.4
Source: Field findings
45 | IFMS STUDY REPORT – APRIL 2015
Annex Table 6: Percentage of institutions using other financial systems by department
Yes
No
Don't Know
Total
Ministry
59.3
28.8
11.9
100
Agency
65.2
26.1
8.7
100
Statutory Department
41.7
55.6
2.8
100
Local Government
27.3
69.3
3.4
100
Referral Hospital
56.3
31.3
12.5
100
Accounts Department
47.6
50.5
1.9
100
Administration Department
70.0
26.7
3.3
100
Accounting Officer
23.8
76.2
0.0
100
Procurement Department
44.1
38.2
17.6
100
Audit Department
13.3
86.7
0.0
100
Others Department
46.7
33.3
20.0
100
Planning Department
51.9
29.6
18.5
100
Total
46.1
46.9
6.9
100
Type Of Entity
Department
Source: Field findings
46 | IFMS STUDY REPORT – APRIL 2015
Annex Table 7: Types of alternative financial systems by entity and department
Integrated
Public
Legacy
Quick
Ledger
Spread
Solomon
BBS
Procurement
system
books
works
sheets
system
connect
Management
System (PPMS)
Personnel and
Payroll
System
Sun
systems
Total
(IPPS)
Type Of Entity
Ministry
0.0
3.3
0.0
5.0
1.7
21.7
18.3
31.7
0.0
100.0
Agency
2.0
0.0
0.0
22.4
10.2
14.3
14.3
16.3
10.2
100.0
Statutory Department
0.0
0.0
0.0
2.8
13.9
8.3
5.6
19.4
0.0
100.0
Local Government
1.1
0.0
3.4
1.1
0.0
0.0
5.6
12.4
2.2
100.0
Referral Hospital
0.0
11.1
16.7
0.0
0.0
0.0
22.2
50.0
0.0
100.0
1.0
1.9
1.0
7.7
5.8
12.5
7.7
22.1
2.9
100.0
0.0
0.0
3.2
9.7
3.2
22.6
19.4
38.7
3.2
100.0
Accounting Officer
4.8
0.0
0.0
0.0
0.0
0.0
0.0
9.5
0.0
100.0
Procurement Department
0.0
5.9
2.9
0.0
5.9
2.9
29.4
11.8
2.9
100.0
Audit Department
0.0
0.0
6.3
0.0
0.0
6.3
0.0
6.3
0.0
100.0
Others Department
0.0
0.0
6.3
0.0
0.0
0.0
12.5
31.3
0.0
100.0
Planning Department
0.0
0.0
3.3
16.7
6.7
3.3
10.0
23.3
6.7
100.0
Total
0.8
1.6
2.4
6.3
4.4
9.1
11.5
21.4
2.8
100.0
Department
Accounts Department
Administration
Department
Source: Field findings
47 | IFMS STUDY REPORT – APRIL 2015
Annex Table 8: Reasons for using parallel systems by type of institution
Type of Institution
Donor
Other
Transactions Requirement
10
12
Accrual
Reporting
1
Non Tax
Revenue
0
Total
Ministry
Number
Agency
%
Number
43.5
9
52.2
13
4.4
6
0.0
5
100.0
33
Departments
%
Number
27.3
2
39.4
3
18.2
0
15.2
0
100.0
5
Local Government
%
Number
40.0
8
60.0
11
0.0
3
0.0
0
100.0
22
Referral Hospital
%
Number
36.4
2
50.0
4
13.6
0
0.0
1
100.0
7
%
28.6
57.1
0.0
14.3
100.0
Number
31
43
10
6
90
%
34.4
47.8
11.1
6.7
100.0
Total
Source: Field findings
48 | IFMS STUDY REPORT – APRIL 2015
23
Annex Table 9: Type of financial transaction executed outside the IFMS
Reve
Supplier
Approv Record Issuance
Bank
nue
invoicing /
e and
commit of
reconcil tion of
ng for
assessme
recei
printing
process
ments
iation
goods
nt/
pting
invoice
paymen
and
stateme and
checks to
ts
releases
nts
suppliers
warrants
Genera
bank
of funds
Orderi Tax
returns/
service claims
s
Type of Entity
Ministry
10.0
6.7
11.7
11.7
3.3
11.7
10.0
11.7
8.3
Agency
26.5
18.4
10.2
12.2
2.0
12.2
10.2
18.4
16.3
2.8
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2.8
6.7
3.4
3.4
1.1
1.1
2.2
6.7
7.9
9.0
11.1
11.1
11.1
11.1
5.6
11.1
11.1
11.1
11.1
Statutory
Department
Local Govt.
Referral
Hospital
Department
Accounts
16.3
10.6
11.5
10.6
1.9
10.6
11.5
15.4
14.4
Administration
12.9
6.5
0.0
3.2
3.2
6.5
0.0
9.7
12.9
9.5
4.8
9.5
4.8
4.8
9.5
19.0
9.5
9.5
Procurement
8.8
2.9
5.9
2.9
2.9
2.9
2.9
5.9
5.9
Audit
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
6.3
6.3
0.0
6.3
0.0
0.0
6.3
12.5
6.3
Planning
3.3
6.7
3.3
3.3
0.0
3.3
3.3
0.0
0.0
Total
11.1
7.1
6.7
6.3
2.0
6.7
7.5
9.9
9.5
Accounting
Officer
Others
Department
Source: Field findings
49 | IFMS STUDY REPORT – APRIL 2015
Annex Table 10: Causes of non-wage arrears on the IFMS
Off
Ineffective
Budget
Poor
Incomplete
Insufficient
system
commitment
suppression
planning
works
funds
commitm
control
ents
system
Ministry
3.3
21.7
6.7
10.0
26.7
10.0
Agency
6.1
4.1
4.1
4.1
18.4
16.3
8.3
11.1
8.3
0.0
27.8
13.9
Local Government
6.7
15.7
7.9
23.6
34.8
15.7
Referral Hospital
5.6
0.0
11.1
5.6
38.9
16.7
Total
6.0
13.1
7.1
11.9
29.0
14.3
Statutory
Department
Source: Field findings
50 | IFMS STUDY REPORT – APRIL 2015
Annex Table 11: Distribution of challenges by type of institution
Supplier
duplication
Inadequate
Knowledge
Bank
Transactions
Maintenance
Passwords
Off-desk
Limited
Logins
Help desk
Total
7
2
12
3
4
7
7
0
2
55
12.9
3.6
21.8
5.5
7.3
12.7
12.7
0.0
3.6
100.0
8
3
13
4
2
7
3
0
3
62
12.9
4.8
21.0
6.5
3.2
11.3
4.8
0.0
4.8
100.0
0
0
2
0
0
1
1
0
1
8
0.0
0.0
25.0
0.0
0.0
12.5
12.5
0.0
12.5
100.0
8
2
24
23
21
5
6
6
2
129
6.2
1.6
18.6
17.8
16.3
3.9
4.7
4.7
1.6
100.0
0
1
9
0
1
1
4
1
3
24
16.7
0.0
4.2
37.5
0.0
4.2
4.2
16.7
4.2
12.5
100.0
Number
69
23
8
60
30
28
21
21
7
11
278
%
24.8
8.3
2.9
21.6
10.8
10.1
7.6
7.6
2.5
4.0
100.0
Downtime
System slow
Challenges
Type of Institution
Number
11
%
20.0
Number
19
%
30.6
Number
3
%
37.5
Number
32
%
24.8
Number
4
%
Ministry
Agency
Department
Local Government
Referral Hospital
Total
Source: Field findings
51 | IFMS STUDY REPORT – APRIL 2015
Ministry of Finance, Planning and Economic Development
Plot 2-12 Apollo Kagwa Road
P.O.Box 8147, Kampala, Uganda
www.finance.go.ug