IFAD programme management department (PMD) presented tips on how to design an IFAD grant, focusing on the financial design-stage documents, the AWPB and the Procurement Plan

1. Designing a Grant: Part Two
25-27 October 2017
Bangkok, Thailand

2. Before starting
 Evidence of legal status and capacity, registration and good
standing
 Evidence of authority of the agreement signatory
 Registration in an IFAD Member State
 Former institutional audited financial statements and audit reports
 Declaration of adoption or compliancy with IFAD Procurement
Guidelines

3. Concept Note - I
How to pass from one step
to the other complying with
IFAD requirements:
> Situation
analysis
> Logframe
> Work breakdown
matrix
> Responsibility
matrix (roles)
> Budget
How to pass from one step
to the other complying with
IFAD requirements:
> Situation
analysis
> Logframe
> Work breakdown
matrix
> Responsibility
matrix (roles)
> Budget

4. Concept Note - III
The work plan consists of the following four matrices:
A work breakdown matrix (milestones/deliverable, outputs,
activities and specific tasks)
A responsibility matrix (who is responsible for each activity)
A calendar of activities (when each activity will be completed)
A resource and inputs plan
The work plan consists of the following four matrices:
A work breakdown matrix (milestones/deliverable, outputs,
activities and specific tasks)
A responsibility matrix (who is responsible for each activity)
A calendar of activities (when each activity will be completed)
A resource and inputs plan

5. Concept Note - II
Translate the Work
Breakdown Matrix
into an indicative
budget
Translate the Work
Breakdown Matrix
into an indicative
budget
Work Breakdown Matrix (WBS)
Project Mgmt
Platform
establishment
1.1.1
Survey on
practices
1.1.2
Fishing training
1.1.3
Knowledge access
1.1
Aquaculture inputs
1.2 1.3
Aquaculture
Project
1.0
1.3.1
Market access
Strategies for SME
Market surveys Opportunities
identification
Vulnerability
mitigation
Investigate pro-
poor options
1.3.1.1 1.3.1.2 1.3.1.3 1.3.1.4
Components
Sub-
components
Activities

6. Concept Note - IV
Preliminary work plan of a single activity with indicative costs
Sub-component
Activities

7. Concept Note - V
1. Name Originator: 2. Division(s):
3. Title of the proposal:
4. Value of IFAD grant: 5. Co-financing:
6. Implementation period: 7. GRIPs ID:
8. Selected Priority Area:
9. Window: 10. Country/Countries:
11. Background/relevance:
12. Direct and indirect target group:
13. Goal, objectives and expected outcomes:
14. Key activities by component:
15. Recipient:
16. Rationale for recipient selection and recipient capacity:
17. Project cost: Budget (USD ‘000s):
*
18. Risks:
19. Monitoring & Evaluation, KM and Learning:
20. Supervision modalities:
21. Linkages:
22. Scaling up:
23. Sustainability:
24. Other aspects:
Specify if in-cash or in-kind
Clearly indicate the target group and
quantify direct/indirect beneficiaries
(realistic identification methods)
Structure by components/activities
reflected into budget structure
Reference to previous grants financing
the same project area/scope and
confirm no overlapping or duplication of
activities

8. Concept Note - VI
* 17. Project
cost:
Y1 Y2 Y3 Total Co-financing
Salaries and
Allowances
Equipment and
Materials
Operating Costs
Goods Services
and inputs
Travel
Consultancies
Training
Workshops
Total Direct Cost
Management Fee
CSP (2%)
Total Indirect
Cost
Grand total
Max 30% of Grant Total
Around 8-10% of Grant Total
8% of Total Direct Costs
2% of Grant Total
Different policy for admin
costs of EC-funded grants
CGIAR Centres only

9. Quality Enhancement (QE) - I
Budgeting:
The grant design documents should contain:
Flow of funds chart and description
IFAD
Recipient
project account
Sub-
recipient 2
project
account
Sub-
recipient 1
project
account
Designated account or ledger
preferably at international bank
(pre-identified)
EURUSD
USD, EUR or local currency
Bank accounts
reconciliation
required
World
Bank
CGIAR Centres only
Make sure you use IFAD project design template

10. Quality Enhancement (QE) - II
 Detailed activity based budget:
 Detailed budget by IFAD categories, component, activity, units, unit cost, quantities, years, recipient, sub-recipient, co-
financier
 Summary budget by IFAD categories, years, recipient, sub-recipient, co-financer
 Summary budget by IFAD categories, years by individual recipient
 Budget narrative by IFAD category
Category
Component/
activity
Unit cost
(curr.)
Implementing entity
{(sub-)recipient}
IFAD (curr.)
Co-financing (curr. - in-
cash or in-kind) Total
(curr.)
Unit Quantity
Total cost
(curr.)
Y1 Y2 Y3 Total Y1 Y2 Y3 Total
Salaries and
Allowances
Equipment
and Materials
Operating
Costs
Goods
Services and
Inputs
Remember to:
Classify project activities into IFAD categories
Identify quantities, unit, units costs and co-financing
Respecting IFAD caps (Salaries, Operating costs,
Overhead, CSP, etc)
At QE stage, budget should be developed
in a much more detailed way

11. Quality Enhancement (QE) - III
Some tips to comply with IFAD financial requirements:
 Use IFAD standardized categories  Round-up budget figures to nearest
1,000
 If possible, reduce direct costs
categories to max 5 categories
 Specify if any sub-recipient and its
administered budget share
 Split direct and indirect costs and confirm
operating costs are project direct costs
 Overhead maximum 8% of direct costs
(formula)
 Specify co-financing amount and
whether in-kind or in-cash
 Salaries maximum 30% of total grant
amount
Most recurrent issues ormissing information

12. Quality Assurance (QA) - I
• Financial Governance section should include:
• Recipient is obliged to consolidate financial reports from sub-grantees (SOE, TL and
audit)
• Updated FMAQ should be provided
Financial reporting (within 45 days
from reporting period end)
Audit reporting (within 6 months from
fiscal year end)
Semi-annual unaudited SOE AFS plus AOL on SOE or PAR
Accompanying transaction list Management letter referred to the project

13. Quality Assurance (QA) - II
Grant design document annexes:
Eligibility and Due Diligence Checklist
Declaration (email acceptable) of acceptance of:
Project Description
Project Budget
Grant Agreement template
Commitment to subject the sub-agreement with eventual sub-grantees to IFAD no-
objection
QA is the last chance to
address the comments and
recommendations provided by
IFAD Finance, Legal and
Quality Assurance divisions