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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

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types of financing
Types of Financing
  • Highly concessional
  • Hardened terms
  • Intermediate terms
  • Ordinary terms
description of lending 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
Basic documents
  • Financing Agreement
  • Letter to the Borrower
  • Loan Disbursement Handbook
  • AWPB
  • Procurement Plan
standard procedures
Standard Procedures
  • Replenishment to Special Account/Designated Account
  • Reimbursement
  • Direct Payment
  • Special Commitment
special account designated account
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 account1
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
Replenishment
  • Should be in USD
  • Atleast or equal to 20% of the advance
reimbursement
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
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 payment1
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
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
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
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 soe1
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
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
Breakup of Expenditure
  • Reasonable disclosure of expenditure within the category
  • PMU/District units-wise
  • Activities
  • Why the breakup is required?
documentation required overall
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
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
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 required1
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
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
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
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
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
Reconciliation of Disbursement
  • IFAD sends copy of Disbursement Advice
  • Historic transaction
  • Status of Funds by Category
  • PMU to reconcile
register of contracts
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