Implications for Donors

Guide to Financial Management

Implications for Donors

New Agenda - Implications for donors

All grant makers are keen to see impact and change on the ground. No one wants to see funds being spent inefficiently, or stolen. Yet the very systems that donors commonly put in place to monitor partners may make it difficult for NGOs to do their job.

If donors were to put this new management agenda into practice, what are the implications for financial management? How would it change the way things are done on a day to day basis? What would we need to do to make it a reality?

Require partner organisations to provide evidence of downward accountability:

  • involvement with beneficiaries in planning
  • presentation of financial information to beneficiaries
  • presentation of internal audit / external audit findings to beneficiaries

Budget monitoring:

  • Build flexibility into partners’ budgets to facilitate project changes. For instance, broader categories rather than very detailed budget lines may be useful for implementation and review.
  • Allow partners greater flexibility in terms of under / over spends on particular budget lines
  • Agree overall goals, values, methods and amounts rather than tying partners into an imperfect plan and budget

Accounting systems:

  • Be aware of implementing partners’ skills and capacity, and their other donors’ demands: standardisation is not always suitable for them.

Also see Reporting to beneficiaries and Achieving value for money sections of the Guide.

 

If you have put any of these ideas into practice, please share your experience with other members of the Mango community by submitting a case study.