For All Projects

H.1 On the basis of data generated in paragraphs F.1 to G.10, above compile appropriate financial performance indicators including the FIRR for the project and, where appropriate, the EA. Discuss proposed indicators with Task Manager and counterparts, explaining logic of selection and

methods of calculation.

H.2 With the Task Manager, explain to counterparts, in detail, the method of compilation and the forecast results of all financial statements at all appropriate levels of concerned institutions and managements with the objective of reaching agreement on the Project Cost Estimates Table, the financing plan, the financial projections and tariffs and charges proposed.

H.3 With the Task Manager, meet with co-financiers at mutually agreed locations (if possible in the presence of counterparts) to explain the method of compilation and the forecast results of all financial statements at all appropriate levels of concerned institutions and managements with the objective of reaching agreement on the project cost table, the financing plan, the financial projections and tariffs and charges proposed.

H.4 Draft the section of the Aide Memoire (OM 600 paragraph 39) relating to all financial aspects of the project and discuss with the Task Manager.

Make any agreed amendments for presentation of complete Aide Memoire to counterparts at appropriate levels.

H.5 Draft paragraphs for inclusion in the financial section of the Appraisal Report, and prepare financial annexes to attach to the Appraisal Report.

Review with the Task Manager.

Appraisal Checklist for a Financial Intermediary Institution

7.16.2 Financial Intermediaries (FIs) comprise a wide range of institutions, including Apex institutions that service one or more FIs in a country. FIs may provide services to one or more sectors in a country (agriculture, various categories of industry, etc.), including support to microfinance organizations. The latter may also receive support from the banking sector in a country, with or without FI support. The generic checklist that follows, therefore, should be used with caution and appropriately modified to address the nature and form of the FI that is under appraisal.

Activity Remarks/comments

Preparation at Headquarters

A.1 Meet with Division Manager and Task Manager to receive briefing on the Bank's approach to funding FIs in the country, the sector (e.g.

agriculture, industry, etc), the objectives of the project and of the appraisal mission.

A.2 Study the Country Strategy Paper (OM 330) to understand the role that the project to be designed will fulfil.

A.3 Study relevant reports on the country profile, institutions to be involved in design, authorization, implementation, and operation of the project, particularly where available, the proposed FI.

A.4 Study all reports on project identification and preparation.

A.5 Study all relevant reports on country and sector project performance.

A.6 Study all reports issued within the past five years on similar FI projects in the country.

A.7 Based on steps A.1 to A.6, above, summarize all positive and negative attributes ascribed to country, sector and similar projects

B. Initial Steps

B.1 Participate in, or where necessary, arrange meetings with key managers and any counterparts representing managers in the FI to confirm appraisal arrangements/requirements. Make a judgment on the likely efficiency of the managers and the counterpart(s).

B.2 Participate in, or where necessary, arrange initial meetings with government counterparts in all organizations likely to be concerned with project development, to confirm appraisal arrangements/requirements. Organizations may include the Central Bank, Ministry of Economy, Ministry of Finance, sector ministries (Agriculture, Industry), Ministry of Trade and Industries, etc.

B.3 Ensure all managers and staff to be involved in project planning and implementation have copies of the Bank’s Handbook for Borrowers on Financial Management and Financial Analysis of Projects, the Bank’s Disbursement Handbook and the Bank’s Procurement Handbook.

B.4 Advise on the availability of the Bank’s Governance Web site and the web-based Guidelines on Financial Management and Financial Analysis of Projects

C. The Institutional Environment

C.1 Confirm evidence provided through information gathered from paragraphs A.1 to A.6, above.

C.2 Determine current organizational structure and management position responsibilities, with respect to the FI and the project, of central government, state government(s) and sector agencies that will be involved in project design, development, implementation and operation, for example, Central Bank, Ministries of Finance and Economy, Industrial Production, Planning and Development, Agriculture, Export Guarantee Agency, etc.

C.3 Determine the likely acceptability to the Bank of current and/or proposed organizational and management structure of the FI and/or consultants involved in preparing the project’s planning, programming, design, development, implementation and operation.

C.4 Understand the country’s financial sector, the role of the central bank and the banking system, and their probable application to/impact on the FI and the project.

C.5 Understand the role that the FI plays within the financial sector, for example, is it an apex institution serving one or more FIs? Is it a microfinance institution serving a specific small sectoral or regional/local group of clients? Is it a narrowly focused operation for a sub-sector such as textiles?

C.6 Determine the capability, capacity and current performance of the country’s accounting and auditing profession as it impacts, or will impact, on the FI and on the project.

C.7 In countries where the government audit service is required to audit the activities and financial statements of a FI, determine the capability, capacity and current performance of the government auditing profession, particularly the Auditor-General’s Office or equivalent, as it impacts, or will impact, on the FI and on the project.

C.8 Determine the actual, or forecast anticipated, quality of accounting and book-keeping capability and training in the FI to service the FI and the project.

C.9 Determine the capability of the financial manager(s) designated to be responsible for the project, against the background of paragraphs C.6 through C.8 above.

C.10 Make judgments as to required modifications to the FI’s organizational structures, lending operations, cash management, risk management, financial accounting /bookkeeping /management and staffs, and training necessary to support the project and where appropriate recommend for inclusion as a component in the project for appraisal.

Share findings with the Task Manager.