[REPORT] IFMIS implementation in Kenya’s Government

Brief On Integrated Financial Management Information System (IFMIS) Implementation In National And County Governments

INTRODUCTION

The Government of Kenya’s IFMIS is an Enterprise Resource Planning (ERP) Software. ERP applications are large-scale computer software and hardware systems that attempt to integrate all data and processes of an organization into a unified system housed in a centralised database which is accessed through a secure network. ERPs have capabilities for handling enterprise wide business processes ranging from functions such as manufacturing, logistics, distribution, inventory, shipping, invoicing, and accounting. They can also aid in the control of business activities like sales, marketing, quality control, and human resource management.

ERP functionalities are managed through a system of modules, which allows for flexibility in implementing various functions. This not only plays an important role in streamlining the efficiency and effectiveness in the management of public financial resources, but further contributes to fighting corruption through the promotion of greater comprehensiveness and transparency of information across government institutions.

HISTORY OF THE INTEGRATED FINANCIAL MANAGEMENT SYSTEM -KENYA

1996

In 1996 the GoK, through the Accountant General’s Department undertook an in-depth analysis of financial management and audit, people management and organisation and financial management information systems in the government, and established the way forward in addressing the financial management problems in government.

The Accountant General’s Department developed a project proposal for IFMIS emphasizing the need to address the problems that had been identified which included:

• Poor record management
• Untimely presentation of financial reports
• Poor accountability of financial resources
• Lack of proper audit trail
• Enhanced transparency and accountability
• Improved efficiency

1997

The development of an IFMIS commenced with diagnostic reviews to identify issues and problems of finance and accounting in GoK. This review was carried out in three phases. The first two phases were undertaken between 1997 and 2000.

In 1997, DFID provided some development assistance to GoK for “Strengthening Government Finance and Accounting Functions”. This was carried out in two phases which concentrated on team building and investigating the issues, problems, deficiencies and needs. Subsequently, a Comprehensive Project Framework (CPF) was developed.

The DFID CPF set out to improve the performance of GoK finance and accounting functions, especially in financial management control and audit, financial management information system and people management and organizations. Specifically, the following issues had been identified in relation to PFM issues in GoK:

• Accountability and transparency is poor
• Irregular payments are significant
• Outstanding bills to suppliers have escalated
• AIE holders lack up to date and accurate information for effectively monitoring and controlling expenditures
• Revenue streams are poorly identified and collection rates are low
• Mobilisation of donor funds is poor, causing delays in implementing projects
• Donors lack confidence in existing systems
• Current emphasis is on monitoring inputs rather than outputs
• There is no objective or effective mechanism for disseminating budgets to the district level
• GoK proposes to move to a modified accrual basis of accounting
• Motivation, morale, compliance and enforcement are all low

2003

IFMIS implementation in Kenya commenced in 2003, originating from gaps and weaknesses within the SIBET system that was in use at the time. It was felt that there was need to introduce different modules comprising of Accounting, Revenue management, and Asset management among others, and the establishment of interfaces with the Central Bank payment information system, Kenya Revenue Authority and the Ministry of State for Public Service for payroll and human resource management modules.

The GoK therefore procured an integrated financial computer package, Oracle Government Financials for the Public Sector by State Informatics Ltd of Mauritius and Simba Technology Ltd of Kenya.

2006

The GoK Strategy to Revitalize Public Financial Management, by the PFM Reform Coordination Unit at the Ministry of Finance in 2006 recognized IFMIS contribution to the six PFM reform pillars to improve the government’s capability and systems to utilize public financial resources towards Economic Recovery Strategy (ERS) for Wealth and Employment Creation. The PFM pillars were:

1. Financial Sustainability and budgeting
2. Resource mobilisation
3. Budget execution
4. Procurement
5. Oversight and evaluation
6. Cross cutting issues

In 2006, the Ministry of Finance sought to procure the services of a consultant to undertake a diagnostic review of the Integrated Financial Management Information system.  A Contract was given to M/S Information Technology Associates Limited for provision of consultancy services to the IFMIS project in January 2007 for 20 weeks. This contract was to perform a situational analysis of the extent of implementation of IFMIS and prepare an action plan and recommendations for fast tracking IFMIS implementation.

This consultancy established the following:

• General Ledger – rolled out to 24 out of the 43 accounting units.
• Purchase Order and Accounts Payable modules – rolled out in 24 out of 43 accounting units
• Budget module set up but was not in use due to an inadequate SCOA structure and inability to produce printed estimates in a format acceptable to the users, especially reflecting personnel details. This led to the development of an in-house budget system.
• Cash management module was initially set up in 2006 but did not go beyond testing. The local supplier had no experience in implementing this module.
• The financial analyser module had not been set up, and this was attributable to lack of understanding of its functionalities.
• Hardware procured was not aligned to IFMIS requirements, and were allocated to ministries for non-IFMIS use. The report made recommendations that GITS should take over the management of acquisition, installation and support of all IFMIS hardware
• Lack of installation of data recovery hardware for IFMIS operations
• Insufficient capacity building on sun solaris in IFMIS
• Bespoke (GoK) manuals did not reflect government business processes especially in accounting, budgeting and procurement, but only focussed on IT processes
• It was unlikely that customized manuals could be produced without being derived from an output of business re-engineering. The report recommended that detained documentation of business processes for each functional area be undertaken and used as the basis for customized user manuals
• The business process re-engineering was also useful to identify areas that require policy, legal and procedural authorisation
• The location of the IFMIS office in the AGD gave the perception that IFMIS is an accounting project. The report recommended that each of the project components, eg budget, GITS, procurement oversight authority, accountant general, internal auditor general and controller and auditor general should establish office facilities to support their respective modules.

It was therefore recommended that an IFMIS project charter be developed that would guide the re-engineering of business processes, and a comprehensive management and technical infrastructure be established to support IFMIS deployment. Identification of systems to be integrated with the IFMIS was also recommended.

The manual processes were also prone to long bureaucratic steps that often delayed transaction processing and payments, and led to opportunities for mismanagement of public funds due to the various approvals required. Only three IFMIS financial modules were implemented by 2010, namely the General Ledger, Accounts Payables and Purchase Order. Though these modules had been rolled out, they had been partly implemented with considerable reliance on manual processes.

With only three financial modules in operation by 2010, public financial management (PFM) in Kenya relied almost exclusively on manual processes (including expenditure approval and bank reconciliation processes) which undermined the security and integrity of PFM.

In addition, the three modules were separately managed and implemented by respective departments at the then Ministry of Finance in a silo based framework. This framework exacerbated the already precarious status due to the independent modular management approach restricted to distinct officers operating the system without due cognisance to the integrated nature of their operations.

At the same time, not all PFM disciplines used the system. In view of the fact that only the three modules above were in operation, only accountants and procurement officers operated the system.  Finance/budget officers, and accounting officers in charge of their ministries did not have access or use of the system.

During this time, the Ministry of Finance was operating two distinctly different Charts of Accounts – one for budget preparation and one for budget execution. The process of translating between the two codification structures for purposes of expenditure was manual and prone to errors. At the same time, the Public Sector Budgeting module could not handle budgeting and reporting. This latter problem led to the development of a separate stand-alone programme for budgeting developed under an MSQL programme which could not be integrated with the IFMIS.  Financial reporting on budget and expenditures was thus highly manual and difficult to implement.

Other problems prior to IFMIS Re-engineering included frequent system shutdown due to lack of professional support and inefficient infrastructure, limited coordination among user departments, insufficient networking, insufficient strategic focus, limited system ownership and less than optimal human resource development to support system users. Various source systems such as debt management, pensions and payroll that should have provided vital information to support the IFMIS and enhance its reporting capabilities existed independently, with no integration framework in place.

Due to these system challenges, users and beneficiaries of the system were often frustrated with its use. The IFMIS system acquired a negative perception amongst users and customers (such as government suppliers), and was often the scapegoat for general government inefficiencies with regards to payment processing and transacting and created avenues for corruption.

This therefore led to calls for the re-engineering of IFMIS to reverse this trend and introduce a full cycle end-to-end integrated approach for better financial service delivery to citizens.

In 2010, the Government developed a Master Plan for IT shared services across the 42 ministries and 175 local authorities. The government recognized that the investments in the current IFMIS must be balanced with the requirements of the new Constitution and the need for automation. This called for an automated budgeting system for the financial year 2011/12.

IFMIS Re-engineering in 2011

The Re-engineering of the Integrated Financial Management Information System (IFMIS) was initiated in 2011, and guided by the Strategic Plan for the period 2011-2013. This Strategic plans was premised on the following components:

1. Re-engineering for Business Results: This component’s objective is to re-engineer business processes for improved financial management.

2. Plan to Budget (P2B): This component is aimed at providing a structured framework for development and deployment of a fully functional, automated planning and budgeting system, aimed at improving the accuracy and efficiency in the Government’s planning and budgeting process.

3. Procure to Pay: This component is aimed at creating an end to end automated process that starts at development of procurement plans, to the actual procurement of goods and services, to payment of suppliers for goods or services delivered.

4. Revenue to Cash: This component is aimed at providing functionalities for collection, recording and classification and reporting of Government revenue. It involves all activities related to revenue and cash management from generation, collection, recording of revenue and distribution of funds to the ministries.

5. Record to Report: This component encompasses all activities that include the updating and maintenance of the general ledger, the reconciliation of sub ledgers to the general ledger and closing of books. It also includes recording, control and reporting on fixed assets at both National and County level.

6. ICT to Support: The main objective of this component is to provide the technical support underpinning effective and efficient automation of all the IFMIS processes. ICT to Support aims to provide the infrastructure and support required for a fully functional financial management system.

7. Communicate to Change: This component focuses on change management, capacity enhancement, information generation and dispersion, education and effective communication among IFMIS stakeholders.

The IFMIS Re-engineering programme adopted a policy direction from “a modular to full cycle end to end framework”. This approach was crucial in moving away from the silo based implementation of modules, to an end to end integrated framework in which users would be cognizant of their roles and responsibilities within the entire spectrum of public financial management.

The programme was successful in undertaking business process reviews of all public financial management processes. In appreciating that government protocols and procedures are often rigid and difficult to change, this was a milestone achievement. The Business Process Reviews facilitated a review and in some cases removal of obsolete process steps that would not be automated.

The programme activated additional financial modules-Cash Management, Fixed Assets, and Accounts Receivable in ten pilot ministries. The functions and operations of the existing financial modules were also stabilized. Approval processes in transaction processing and payments were automated in the system.

An IFMIS Academy was established to enhance capacity of IFMIS users both at the national and county governments. The IFMIS Academy utilizes an in-classroom and online training framework in which users can receive continuous training even while back at their offices.

A new Single Chart of Accounts (SCOA) was developed and mapped into the IFMIS. The development of the new SCOA facilitated the consolidation of both budget and financial information, and incorporated elements that would support programme based budgeting, and facilitate analysis of budgets and expenditure by geography, programmes, projects and donor facilities.

IFMIS Re-engineering Strategic Plan 2013-2018

The subsequent IFMIS Re-engineering Strategic Plan (2013-2018) was developed informed by the progress of implementation and the changes in the government structure. The focus of the second Strategic Plan was to ensure optimal use of the system in national and county governments in contribution towards efficient and effective management of public funds. This Strategic Plan also addresses the objectives of Public Financial Management Reforms (PFMR).

This phase of implementation is on-going, with concurrent implementation of the IFMIS Security solution. In addition, greater emphasis has been placed on the support for the optimal utilization of all financial modules and generation of financial reports from the system.

Capacity building for IFMIS users in national and county governments through the IFMIS Academy is on-going, with measures initiated to transition the IFMIS training to the Kenya School of Government.

ORGANIZATIONAL STRUCTURE FOR IFMIS RE-ENGINEERING

The IFMIS Steering Committee (SCI) is the decision making organ that provides policy direction for IFMIS Re-engineering. The Steering Committee is chaired by the Cabinet Secretary, National Treasury, and consists of the CS Ministry of Devolution and Planning, PS/National Treasury, PS/Ministry of Information and ICT, Principal Administrative Secretary-National Treasury, Economic Secretary, Governor/CBK, Commissioner General/KRA, Controller of Budget, Auditor General, CRA Chairperson, Transitional Authority Chairperson, DG/PPOA, DG/NIS, and the Kenya ICT Authority. The SCI provides overall policy guidance to the re-engineering process and secures the high level commitment, setting the priorities and endorsing resolutions on the direction and progress of the programme. The SCI meets regularly to update on progress of project implementation.

The Technical Committee on IFMIS (TCI) comprises of heads of user departments at the National Treasury. It ensures that the re-engineering IFMIS programme is implemented efficiently and effectively and that it delivers on its desired objectives. The TCI meets as and when required.

The Departmental IFMIS Implementation Units (DIIUs) support the day to day consultative framework for key activities of the re-engineering process. They consist of designated officers from user departments nominated by their Heads of Departments. The DIIUs are the first point of contact in user departments on IFMIS issues, and provide feedback on IFMIS implementation that constantly informs business process re-engineering efforts.

IFMIS RE-ENGINEERING IMPLEMENTATION STATUS

1. Re-engineering for Business Results 

• Re-engineering of Business Processes in the core modules of Plan to Budget, Procure to Pay, Revenue to Cash and Record to Report to ensure continued review and automation of business processes in view of changing legislative and process scenarios.

• Business Readiness and Organizational restructuring including activities towards rationalizing the IFMIS department staffing structure, scheme of service, national and county government support framework, capacity building and support to ensure that all activities needed to support the actual system roll out are in place.

• Review of Laws and Policies to support IFMIS implementation including the Code of Regulations, Public Procurement and Disposals Act, and PFM regulations to ensure that IFMIS re-engineering implementation is in line with the requisite legislation.

1. Plan to Budget

The Plan to Budget deployment was initiated in July 2011 to provide a structured framework for development and deployment of a fully functional, automated planning and budgeting solution for the national and county governments. The Plan to Budget system went live in February 2012 in 10 pilot ministries and thereafter to all the other ministries. The system is currently in use by the national and 47 county governments.

An extension was granted until December 2013 to facilitate the rollout of the budgeting solution to 47 Counties and integration with systems like Oracle EBS General Ledger. Integration with the GL was realized in May 2013, during the contract extension period.

The Plan to budget module has designed workflows in the system to enable automated budget approvals. The Plan to Budget system has been used to develop the following:

1. Supplementary Budget I for FY 2012/13
2. Supplementary Budget II for FY 2012/13
3. Budget Estimates and Supplementary Budgets for FY 2013/14
4. Budget Estimates and Supplementary for FY 2014/15
5. Budget Estimates for FY 2015/16

The following modules have been implemented:

• Hyperion Planning and Budgeting,
• Hyperion Workforce Planning, a module that facilitates planning for personal emoluments.
• Hyperion Capital Expenditure (CAPEX Planning) which is awaiting the adoption by the relevant departments.
• Hyperion Performance Scorecard, which is awaiting the adoption by the relevant departments.
• Hyperion Financial Data Management, an interface to facilitate data exchange with various data sources such as the Ledger, E-Promis and GHRIS.
• User Productivity Kit (UPK), which is an electronic interactive user manual that gives step-by-step instructions to users on how budgeting tasks may be completed

The system’s integrated approach provides an interface to the procurement and expenditure data in the IFMIS General Ledger so as to provide synchrony between the core financial management functions. This is aimed at improving the overall view of the financial status of a ministry, department or agency, and therefore facilitating the making of management decisions on the allocation and prioritization of resources. Training of users in national and county governments has been conducted, including training of trainers for the IFMIS Academy.

1. E-Procurement

The electronic procurement and Supplier portal were launched by H.E. the President in August 2014. The e-procurement system has been implemented in the ministries, departments, agencies and 47 county governments. The e-procurement system has automated the following processes:

• Supplier Management; Requisition Management; Quotation & Tender Management; Contract Management; Order Management; Inventory Management; Receipting Management; Invoice & Payment Management
• Online approval hierarchy for Purchase Order and Accounts Payable
• Automation of procurement planning in line with the approved budget estimates
• Supplier engagement and training on how to submit bids online through the Supplier Portal
• Adoption of Item Master in line with the international standard goods/service classification system (UNSPSC).

Quotation Management (Sourcing) is a key module within the e-procurement process that has been configured in the system. This module allows users to procure goods and services (in line with the approved procurement plan in the system) from requisitions and source suppliers through the authorized procurement method. The end result of this process is either a Blanket Purchase Agreement (BPA) or a standard Purchase/Service Order. The e-procurement permits direct payments only for certain utilities such as payment of electricity and water bills.

Blanket Purchase Agreement (BPA) is a framework agreement that procuring entities enter into with the suppliers for purposes of recurrent services such as supply of teas from the KICC, cleaning services, supply of newspapers etc. A BPA is one of the outcomes from the sourcing process.

After the e-procurement launch in August 2014, MDAs were allowed to capture their existing framework agreements directly as BPA until end of September 2014, since they had already sourced for them. Direct creation of BPAs in the system was terminated in September 2014, thereby requiring that all Procuring Entities follow through with the sourcing process. This included all the contracts that had been awarded manually.

Use of Supplier Portal

Initial Supplier sensitization was conducted in May 2014. The IFMIS Department has continued supporting for Suppliers who walk in together with the respective procurement officers from MDAs who support them. The IFMIS Department has initiated a comprehensive supplier training in June 2015 in all the 47 County Governments.

Despite the Supplier training and support, some of the MDAs still capture the quotes on behalf of the Suppliers who had submitted manual tender documents (Capturing Surrogates). The creation of Surrogate quotes for Suppliers was disabled with effect from 22^nd May 2015 so as to encourage the Suppliers to respond for themselves through the Supplier Portal.

The optimal use of the Supplier Portal enables the Suppliers to submit their bid documents online which are then evaluated through the e-procurement system and an order or a framework agreement is generated from the system, which will inform the supplier payment if they win the bid.

1. Revenue to Cash

The objective of this module is to enhance the collection, accounting and timely reporting of public revenue in National and County Governments. The module facilitates automatic reconciliation of bank accounts and cash forecasting and positioning.

Automatic bank reconciliation has been implemented and enabled in national government. The Accountant General developed a Treasury Circular terminating manual reconciliations with effect from 1^st July 2015. This will facilitate the full adoption of the automatic bank reconciliation in the IFMIS.

Implementation of the cash flow planning process and automation of the exchequer release process will be finalized in the new financial year.

1. Record to Report

The General Ledger, Accounts Payable and Purchasing Order modules have been rolled out to all MDAs and county governments. Stabilization of the Accounts Receivable module and training and support for the utilization of the Fixed Assets module has been planned for the first half of the next financial year.

Financial reports have been configured in the IFMIS to facilitate statutory and management reports generation. The reports have been configured in line with user requirements. Training for the various users on report generation from IFMIS is ongoing.

1. Integration of IFMIS with other third party systems

Kenya Revenue Authority (KRA)

Integration of IFMIS (Accounts Receivable) with KRA’s revenue collection system was developed, and finalization is dependent on KRA and CBK readiness for making the automation operational. In addition, discussions are ongoing to ensure that the integration is in line with constitutional provisions for public financial management.

Commonwealth Secretariat Debt and Resource Management System (CS-DRMS)

Integration framework of CS-DRMS (Debt Management System) with IFMIS Accounts Payable and General Ledger to automate the process of loan repayment was developed, tested, and accepted during User Acceptance Testing. This integration implementation is dependent on CBK’s readiness to process the Payment Advice (PA) file via EFT from IFMIS.

Electronic Project Management Information System (E-PROMIS)

Integration framework of IFMIS with E-ProMIS) was developed, tested, accepted and ready for use. This can be made operational starting from this financial year once ERD has finalized mapping the projects within e-ProMIS with projects coded in IFMIS. The Single Chart of Accounts has been upgraded to take into account project coding.

Pension Management Information System (PMIS)

The framework for integration of IFMIS with the Pension management system (PMIS) was developed, and testing with real data is scheduled in the first half of the next financial year.

Government Human Resources Information System (GHRIS)

Integration framework between IFMIS and GHRIS was developed, and awaiting testing with real data from GHRIS.

Group Personal Accident (GPA)

Integration of Group Personnel Accident (GPA) system with IFMIS Accounts Payable was developed, tested and accepted during UAT and deployed for usage. This integration is ready to be in operation during this new financial year.

1. IFMIS End User Training through IFMIS Academy

The National Treasury procured the services of a Training/Capacity enhancement firm to develop content and provide in-classroom and online training for IFMIS users in national and county governments. The IFMIS Academy developed curriculum and manuals in line with the users’ system responsibilities and have provided training at the Kenya School of Government since 2012.

To date, 7320 system users have been trained on their system responsibilities through the IFMIS Academy as follows:

2012 – 1931 users

2013 – 3327 users

2014 – 2062 users

1. Roll out of IFMIS Modules

IFMIS roll out and re-engineered process implementation was launched in August 2012. The system underwent an upgrade in 2012 to bring the system up to date with the latest version of the application, and in readiness for the implementation of IFMIS Re-engineered Processes and integration with external systems like KRA.

The re-engineering processes went through different implementation processes including Conference room pilots, business process documentations, requirement gathering, development and customizations, integrations, unit testing, User Acceptance Testing and report developments. The re-engineered modules went through User Acceptance Testing (UAT) in April 2014 as follows:

Accounts Payable        23^rd April 2014

Accounts Receivable    28^th April 2014

Purchasing Order         22^nd April 2014

Fixed Assets               25^th April 2014

General Ledger           30^th April 2014

Cash Management       29^th April 2014

Based on the signed off UAT, the IFMIS Re-engineered process implementation went live starting from August 1, 2014.

The IFMIS users are defined in the system in line with the system responsibilities. To date, the IFMIS has 10,293 users.

1. Status of Deployed Hardware

• System availability

To ensure system availability Real Application Cluster and Active Data Guard in conjunction with RSYNC technology plays major roles. In addition, backups are undertaken daily to protect against failures. The main IFMIS production database backup type is a fusion of Oracle RMAN and Oracle Rapid Clone procedures for a Real Application Cluster. This implies that the mode for the database backup is Hot Backup (online backup) thus the system remains available during the database backup. This type of back up involves having the database Instance online

• Data Center environment made available

Due to the challenges expressed by IFMIS on the security for their equipment and systems in the data center, surveillance and access control to and from the Data center was implemented. Setup of security surveillance and access control system for the Herufi House Data Center as per the requirements gathered and validated was done.

The surveillance system comprises of 7 HIK High Definition IP CCTV cameras placed in strategic positions of the data center to give an all-round panoramic view of the room and equipment in the Data Centre.

The recordings are captured at high resolution onto a high end network video recording (NVR) device and backed up off the DC premise to a remote storage.

The doors are fitted with high power 500KG magnetic locks and access is controlled by card readers, pin and biometric devices which requires one to be a recognized and registered staff to gain entry.

• Security and identity management infrastructure deployed

The National Treasury through the IFMIS Department has completed an overhaul of the security Architecture around all IFMIS online resources. This was meant to do away with the previous insecure Architecture where IFMIS applications were only available over a Virtual LAN (VLAN), which required users to have extra computers dedicated to IFMIS access only. This was a resource constraint and it also limited the unrestricted access to IFMIS by users. The IFMIS Security solution has been working on the following:

1. Design and Implementation of a new secure Network Architecture
2. Implementation of new Network and application security and monitoring solutions
3. Implementation of a Physical security at the Herufi House Data Centre
4. Implementation of a Security Operations Centre

The IFMIS applications have already successfully been migrated to the new Network and the users are currently being added to the Active Directory so that they can access the IFMIS through the Virtual Private Network (VPN).  Security solutions that have been installed include:

• IBM InfoSphere Guardium which provides the simplest, most robust solution fordata security and data privacy;
• IBM Q1 Labs QRadar that provides a unified architecture for integrating security information and event management (SIEM), log management, anomaly detection, incident forensics and configuration and vulnerability management. These products offer advanced threat detection, greater ease of use and lower total cost of ownership.

• Data backup systems and Disaster recovery systems deployed

Backups are done through Veritas Netback up software and Oracle Secure Backups. Policies are stipulated on the Media Management Software to back up the IFMIS system in its entirety (database and application). Other configuration options are also stipulated on RMAN.

The backup files at one point or the other will be stored in tape drives, pillar storage and the external backup site (Ruaraka). The backup files are kept away from the instance files server for security and to enhance business continuity. At the end of every calendar year, Full server backups may be done on the IFMIS Servers. These backups, will typically have a retention policy of at least 1 year.

In the event that the Primary Site/box requires maintenance, we can seamlessly switch over existing Primary IFMIS system to Standby in less than 10 minutes.

In the event that there is a complete failure in the Primary site/box, an immediate failover is made from primary to standby system.

BENCHMARKING OF OTHER COUNTIRES WITH IFMIS IN KENYA

IFMIS implementation in Kenya has attracted interests from other countries such as Philippines, Liberia, Ethiopia, Lesotho, Zambia, Uganda, etc. These countries have visited the National Treasury in a bid to learn lessons from IFMIS implementation in Kenya, and interfaces with the payment system at the Central Bank of Kenya.

IFMIS IMPLEMENTATION IN OTHER COUNTRIES

Attempting to compare implementations across different countries is not a direct process due to the varying scope, and requirements of the different projects. However below is an extract for purposes of appreciating the costs of implementation of any basic Enterprise Resource Planning (ERP):

• Botswana – Implementation of a comparable Plan to Budget system cost BWP 63 million (approximately Kshs. 800 million) of which 43 million BWP was spent on software implementation, training and project management

• Uganda – Implementation of a HR and Payroll system in the Ministry of Defence, Uganda cost approximately USD 20 million (approximately Kshs. 1.7billion) including the use of a biometric registration process.

• Ethiopia – Implementation of the IFMIS in Ethiopia rolled out in 6 ministries and 2 regions cost approximately USD 20 million (approximately Kshs. 1.7 billion)

• Slovak Republic: For a country of 5 million, the cost of IFMIS installation was US$60 million. This is exclusive of the ancillary costs, including training and reorganization, which can easily double the price tag. This does not even account for the ongoing costs of licenses and maintenance contracts. (USAID – Integrated Financial Management Systems, A Practical Guide, January 2008)

June 2015

THE NATIONAL TREASURY, NAIROBI