Page 131 - DCOM206_COST_ACCOUNTING_II

Cost Accounting – II

Notes with a view to finding additional savings. The following are the final TRP approved
amounts.

Year 1 Year 2 Phase 1 Year 3 Total
Original Board Approved Amount 33,500,000 34,750,000 68,250,000 32,750,000 101,000,000
TRP Recommended Amount 32,293,000 31,970,000 64,263,000 32,115,000 96,378,000

 The CCM nominated the Ministry of Health (MoH) to be the sole Principal Recipient.
The nominated Sub Recipients are: International Non-Governmental Organisation
(INGO) and national NGO (NGO). The MoH has been a PR for 5 years. During this
time the PR has consistently underspent on its budgets by 30% and received either
B1 or B2 ratings (the average programmatic rating was A2; however, ongoing
significant FMS issues/SR oversight weaknesses led to the B1/B2 ratings).

 KoI is a dual currency environment with US$ and Local Currency (LC).
Discussion Points
1. Efficiency Savings/Funding Limitations: The three-year budget of the R9 grant
prepared by the PR (to be consolidated with R8 HIV grant) amounts to US$ 94,272,875.
The Year 3 budget was borrowed from Phase 2.
2. HR: The PR has its Project Management Unit (PMU) fully staffed. The base salaries
are 20% higher than Government approved pay scales and include an additional 13
month payment.

NGO employs 15 local people. INGO employs 25 local staff in the country but the
salaries are 25% higher than those proposed by the PR and the staff receives year-
end bonuses at between 5 and 10% of annual salaries. INGO and NGO staff are paid
in US$, PR staff are paid in LC.
The PR wants to recruit additional 25 field workers in their budget.

Current Staffing at the PR’s Office Salary/Month/Person (US$)
(All Local Staff)
Country Director 1,240
2 Program Managers 970
Finance Manager 820
M&E Manager 630
PSM Manager 780
6 Project Officers 570
15 Finance staff 550
3 Project Assistants 400
40 Program staff 370
150 Field workers 350
2 Drivers 240

3. Infrastructure and Equipment: The PR wishes to construct 10 laboratories during
Phase 1. Average floor space is 250 sq. m.; cost per sq. m. is stated as LC 121,400. The
cost of equipment for each laboratory is estimated to be LC 2,500,000.
The PR wishes to purchase 150 vehicles which are to be used by staff at national and
local levels. The roads in the KoI are variable with bad roads in rural areas only.
Contd...

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