INTEGRATED FINANCIAL MANAGEMENT INFORMATION SYSTEM (IFMIS)

Integrated financial management information system (IFMIS), is an information system that tracks financial events and summarizes financial information. In its basic form, an IFMIS is little more than an accounting system configured to operate according to the needs and specifications of the environment in which it is installed.

An IFMIS stores, organizes and makes access to financial information easy. It not only stores all the

financial information relating to current and past years’ spending, but also stores the approved budgets for these years, details on inflows and outflows of funds, as well as complete inventories of financial assets (e.g., equipment, land and buildings) and liabilities (debt). The scale and scope of an IFMIS can vary, from simple General Ledger System to a comprehensive system addressing Budget, Revenue, Expenditure Control, Debt, Resource Management, Human Resources, Payroll, Accounting, Financial Reporting, and Auditing processes across central government or even including local government and other public sector and quasi-governmental agencies and operations.

There is broad agreement that a fully functioning IFMIS can improve governance by providing real-time financial information that financial and other managers can use to administer programs effectively, formulate budgets, and manage resources. Sound IFMIS systems, coupled with the adoption of centralized treasury operations, can not only help developing country governments gain effective control over their finances, but also enhance transparency and accountability, reducing political discretion and acting as a deterrent to corruption and fraud.

IFMIS implementation requires patience. The full project life cycle—from definition of objectives, to system specifications, to system procurement, configuration, testing, and rollout—can easily take seven to ten years, or longer, to complete. This type of time horizon is usually well beyond the attention span of donors, which is why it is advisable to divide IFMIS implementation into clearly defined stages with clear objectives and milestones. As each stage is completed, stakeholders should carefully assess project progress and ensure that the system underdevelopment still meets the needs of the government, and that government commitment to the IFMIS is still there. The ultimate goal should be to put in place sound systems that are well understood and embraced by counterparts and in the end will be self-sustaining.