Session Loan Administration

Report
Loan/Grant
Administration
Types of Financing
• Highly concessional
• Hardened terms
• Intermediate terms
• Ordinary terms
Description of lending terms
• Highly concessional – no interest, service
charge of 0.75%, repayment in 40 years
including 10 years grace period
• Hardened terms – no interest, service
charge 0.75%, repayment in 20 years
including 10 years grace period
• Intermediate terms – interest @ 0.5% of
IFAD Reference rate, maturity period 20
years including 5 years grace period
• Ordinary terms – interest on par with IFAD
Reference rate, maturity period 15-18
years including 3 years grace period
Basic documents
• Financing Agreement
• Letter to the Borrower
• Loan Disbursement Handbook
• AWPB
• Procurement Plan
Standard Procedures
• Replenishment to Special
Account/Designated Account
• Reimbursement
• Direct Payment
• Special Commitment
Special Account/Designated
Account
• Provides a mechanism, somewhat
like an imprest account
• Borrower should have sufficient
control and financial systems
• Should be in a currency and bank
acceptable to IFAD
Special Account/Designated
Account
• Initial deposit will be determined by
the Borrower
• Administered by CAA&A
• Audit of Special Account done by
the office of C&AG
• Ceiling of Authorised Allocation
Replenishment
• Should be in USD
• Atleast or equal to 20% of the
advance
Reimbursement
• Outside Designated Account
• For Government pre-financed
expenditure
• Could be in any currency
requested by the borrower
• Will not flow to Designated
Account
• Should not be later than 3 months
Direct Payment
• IFAD directly pays third party
• Project instructs IFAD to pay directly
• In-country banking regulations are
stringent
• For above USD 20,000
• Documentation should show evidence of
amount due
Direct Payment
• For above USD 20,000
• Documentation should show
evidence of amount due
• Progress or due payments
• Only to party in the contract
• Payment instructions should be
clear
Recovery of Initial Deposit
• Balance in the Loan Account minus
committed expenditures equals to
twice the authorised allocation
• 6 months before Project
Completion
• Balance in SA/DA to be refunded
Basic formats for Withdrawal
Applications
• Form 100 – to be filled by CAA&A
• Application Summary Sheet
(supported by documentation)
• Statement of Expenditure
• Special Account Reconciliation
Statement
Statement of Expenditure (SoE)
• Normally used where it is
impractical or unduly burdensome
to provide documentation
• No documentation required
• Threshold in the LTB
• Separate forms for each category
• Breakdown of expenditure
Statement of Expenditure (SoE)
• IFAD to be satisfied about the
Borrower’s/LPA’s accounting
standards, internal control, auditing
capabilities are sound and
adequate
• SoE method could be for threshold
value of expenditure or for a
particular category
• Threshold could be revised either
way, if situation warrants.
What a SoE should contain?
• Form 100
• Special Account statement
• Abstract of summary sheets
• SoE – signed by PD and Borrower –
for each category
• Breakdown of expenditure
Breakup of Expenditure
• Reasonable disclosure of
expenditure within the category
• PMU/District units-wise
• Activities
• Why the breakup is required?
Documentation required - Overall
• The signed contract or confirmed purchase
order– showing the specified amount that is
due to be paid;
• The bank guarantee for advance payment,
as specified in the contract documents;
• The bank guarantee for performance, as
specified in the contract documents;
• Copies of communications sent by the IFAD
country programme manager to the lead
project agency providing the ‘no objection’
(whether post or prior) to the contract
award; and
• Evidence of payment.
Documentation required (contd)
In additional to overall requirements, for
goods:
• Supplier’s invoice, duly certified for
payment specifying the goods, their
quantities, and prices;
• Bills of lading or similar documents; and
• As appropriate, the certificate of delivery
(to include condition of goods on
delivery).
Documentation required
In addition to overall requirements, for
Consultancy payments:
• The supplier’s or consultant’s claim,
duly certified for payment and
showing sufficient detail; and
• As appropriate, a certificate of
delivery of satisfactory services.
Documentation required
For progress and retention payment of civil works:
• The claim of the contractor, including a financial
progress report, stating the work performed and
the amount due;
• A certificate – signed by the project consultants or
owner’s representative, if any, or by
• the borrower’s chief engineering officer to the
effect that the work performed is satisfactory and
the payment claimed is due in accordance with
the terms of the contract; and
• A copy of the contract payment monitoring form
signed in original by the certifying officer.
Wtihdrawal of Loan resources
• Expenditure to cover reasonable cost of goods
and services required for the project
• Establishing the trail of the expenditure to the
AWPB
• Within the programme implementation period
• Category ceilings are not exceeded
• Establish the recommendations of the JRM are
complied with
• Status of audit reports
• Compliance of reporting
Rejection of WAs
• IFAD may reject the WA either fully
or partially
• Requested information is not
provided within the timeline (7
days)
• Project to resubmit the WA in full or
part
Why IFAD rejects the WA
• No trail available to AWPB
• Procurement not as per the
approved Procurement Plan
• Wrong Categories
• Incorrect eligible percentages
• No breakup available for review
Measures that could be adopted
• Refer the Cost Tables or Costab
files for correct category
• Financing Agreement provisions
• Expenditure as per the AWPB
• Respond within the timeline
• Use checklist
Reconciliation of Disbursement
• IFAD sends copy of Disbursement
Advice
• Historic transaction
• Status of Funds by Category
• PMU to reconcile
Register of Contracts
• List all contracts with relevant
details
• Form C10 from LDH
• Contract Monitoring Form C11 from
LDH
• Certified copies of contracts (prior
review procurement and above
SoE threshold) to be sent to IFAD

similar documents