Key Actions by:

Standard 8: Timely and comprehensive project financial set-up.

Set up a project financial management system based on updated activity plans that supports a quick start-up and effective financial management throughout the project.

Work with partners to assess their financial management capacity and develop improvement plans.

  • Who

    • Primary responsible: Head of operations (HoOps)
      • The HoOps ensures CRS conducts a formal sub-recipient assessment before making the initial financial commitment to award funds; reviews improvement plans; and ensures proper documentation of assessments and improvement plans.

    • Others involved: Project manager or chief of party (PM/CoP); finance manager (FM) or other assigned finance or compliance staff; head of programming (HoP) or other assigned programming staff; country representative (CR)
      • The PM or CoP (if designated and available at the time of the assessment) works closely with the HoOps to ensure the financial management capacity assessment is completed, manages the relationship with the sub-recipient around the assessment process, and ideally participates as a member of the assessment team;
      • The FM or other assigned finance or compliance staff conducts the assessment;
      • The HoP or other pertinent program staff assist the PM/CoP and finance;
      • The CR formally notifies the sub-recipient that CRS intends to perform an assessment, and supports with other partner communications around the assessment, as needed.

  • Partnership
    • Per SRFMP guidance, partners are full participants in the implementation of the sub-recipient financial management assessment and improvement planning.
    • As part of CRS’ commitment to institutional strengthening within an overall partner capacity strengthening approach, CRS works with the subrecipient to develop a plan to improve controls, as necessary, related to all partner financial activities, not only those that are directly related to projects implemented in partnership with CRS.
    • See pages 4-5 of the SRFMP for special considerations if CRS is signing a subrecipient agreement with local government or a department or office within a larger government entity.
    • The SRFMP does not apply to partners executing contracted activities. Country programs may consider using contracts, not subrecipient agreements, as the funding mechanism when deliverables can be clearly defined and measured and the nature of the activities warrants such treatment (see Standard 3, key action 3 for additional guidance eon this topic). Consult CRS’ Office of Legal Counsel to determine the most appropriate funding instrument, if needed. 
    • The SRFMP also does not apply to funds transferred to local partners as a contribution (provided the contribution is not funding a cost-share project). Contributions, which are funded by CRS discretionary resources, do not require sub-recipient agreements. The nature of the partnership, staff size, access and security concerns, and the cost-effectiveness of operating through a subrecipient agreement are factors for CRS consideration when determining if a cash contribution or subrecipient agreement is more appropriate.
  • When CRS is a sub-recipient
    • Follow the same process for CRS second-tier sub-recipients. 
  • Emergency projects
    • If it is not possible to conduct an assessment per the SRFMP before preparing the subrecipient agreement, prepare the agreement on the assumption that the partner has inadequate internal controls (i.e. require monthly advances and liquidations).
    • Conduct a full assessment of each new subrecipient as soon as conditions permit, and adjust the partner’s risk status per assessment findings.