Progress report on regional matters arising from reports of the WHO internal and external audits: information document

AFR/RC69/INF.DOC/9 22 August 2019 REGIONAL COMMITTEE FOR AFRICA Sixty-ninth session Brazzaville, Republic of Congo, 19–23 August 2019 ORIGINAL: ENGLISH Agenda item 15.9 PROGRESS REPORT ON REGIONAL MATTERS ARISING FROM REPORTS OF THE WHO INTERNAL AND EXTERNAL AUDITS Information Document CONTENTS Paragraphs BACKGROUND ......................................................................................................................... 1–3 EXTERNAL AND INTERNAL AUDITS........ .......................................................................... 4–6 MANAGERIAL KEY PERFORMANCE INDICATORS .......................................................... 7–8 RISK MANAGEMENT ................................................................................................................... 9 SUPPORT TO WHO COUNTRY OFFICES ................................................................................ 10 DIRECT FINANCIAL COOPERATION (DFC) .................................................................... 11–13 ANNEXES Page ANNEX 1A: Summary of conclusions of internal audits issued between 2011 and 2018 .............. 3 ANNEX 1B: Implementation status of Audit Recommendations for the African Region (as at 31 March 2019) ............................................................................................ 4–5 ANNEX 2A: Number of overdue Direct Financial Cooperation (DFC) reports by country (as at 31 March 2019) ................................................................................................ 6 ANNEX 2B: List of overdue DFC reports (15 March 2018 vs 31 March 2019)......................... 6–7 ANNEX 3: Best performing country offices by size and emergency .............................................. 8 ANNEX 4: Breakdown of risks reported by Country Offices and Regional Office Clusters .......... 8 AFR/RC69/INF.DOC/9 Page 1 BACKGROUND 1. This information document is prepared following requests made during the Fifty-seventh session of the Regional Committee (RC) for Member States to be regularly updated on progress achieved in strengthening compliance with administrative rules, regulations, policies and procedures. Accordingly, an update is provided to the Regional Committee every year. 2. This information document builds on a substantive report submitted by the WHO Regional Office for Africa to the Sixty-eighth session of the Regional Committee in August 2018. The report alluded to accomplishments and challenges of the Accountability and Internal Control Strengthening initiative (AICS) that was launched in 2015 to drive progress towards the targets of the Transformation Agenda. The AICS project has achieved remarkable progress in promoting a culture of accountability and strengthening internal controls in the African Region, particularly in country offices. This is evidenced by the improved trends of audit report ratings in the African Region for the last four years, with no unsatisfactory audit reports received since 2016. 3. The aim of this document is to inform Members States about achievements and challenges in the areas of accountability, audit and risk management since the last Regional Committee in 2018. In addition, the report reviews the status of implementation of internal and external audit recommendations and provides information on overdue Direct Financial Cooperation (DFC) reports as of 31 March 2019. EXTERNAL AND INTERNAL AUDITS 4. Prompt and effective implementation of audits remains a management priority. Progress in implementing audit recommendations is reported quarterly to the Regional Compliance and Risk Management Committee (CRMC). A more holistic approach has been adopted to address control gaps in a comprehensive manner and to provide effective solutions to common problems in the Region. Based on this approach, all the internal audit reports issued during the reporting period were rated as either satisfactory or partially satisfactory with some or major improvements needed, which is a general improvement in the internal control environment in the African Region compared to 2015 and prior years as depicted in Annex 1A. 5. During the reporting period (April 2018 to March 2019), six internal audit reports were issued for the following budget centres: Chad; Ethiopia; Liberia; Nigeria; Family and Reproductive Health; and General Management and Coordination Clusters at the Regional Office for Africa. Additionally, four external audits were issued for the Country Offices (WCOs) in Angola, Kenya, Madagascar and United Republic of Tanzania. A total of 306 new audit recommendations were issued during this period. 6. Six internal and one external audit reports1 were fully closed between April 2018 and March 2019. As of 31 March 2019, sixty-eight per cent of the total audit recommendations were implemented to the satisfaction of the auditors and were successfully closed, with 32% still outstanding. In total, 359 recommendations were closed during the reporting period. Annex 1B shows the detailed status of audit implementation for the Region. 1 Internal audits for the following Country offices: Comoros, Ghana, Kenya, Mali, Sierra Leone and United Republic of Tanzania; and external audit of the Central African Republic. AFR/RC69/INF.DOC/9 Page 2 MANAGERIAL KEY PERFORMANCE INDICATORS (KPIs) 7. The Regional Office continues to regularly monitor the performance of budget centres against the (17) established managerial Key Performance Indicators (KPIs) covering the enabling functions: finance, procurement, human resource management (HRM), security, information technology (IT), travel and asset management. The KPI results for 2018 show improvements in the areas of finance and accounts, and in security and fixed assets; but with mixed outcomes in other areas. 8. Performance has been regularly reported to the CRMC and shared with budget centres, and through KPI dashboards, so as to build on past performance results and implement recommended actions as needed. A ranking of budget centres was established for greater transparency. The top three performing WHO Country Offices in 2018 are shown in Annex 3. RISK MANAGEMENT 9. All the budget centres in the Region continue to manage their risks, using a corporate risk management tool. All budget centres have local risk registers that contain risks and related risk mitigation plans. During the mid-term review of programme budget implementation at the end of 2018, the local risk registers were updated, and 171 new risks were identified, and 97 mitigation plans developed, as shown in Annex 4. SUPPORT TO WHO COUNTRY OFFICES 10. The Compliance Unit coordinated programme and administration reviews and compliance missions to nine (9) Member States.2. In addition, seven Country Offices were provided support before, during and after internal and external audits and donor reviews.3 DIRECT FINANCIAL COOPERATION (DFC) 11. Monitoring the timely submission of DFC reports has received increased attention in recent years. During the reporting period, a significant improvement was achieved in reducing the number of outstanding reports compared to previous years. As at 31 March 2019, only 44 DFC reports, totalling US$ 8.5 million remain overdue compared to 369 overdue DFC reports totalling US$ 21 million in March 2018. Annex 2 presents a summary of the number of overdue DFC reports by country and respective amounts not yet justified. 12. The Regional Framework for Accountability and Assurance Activities continues to be implemented to provide guidance on managing inherent risks in the area of DFCs. The Framework operationalizes the relevant provisions on accountability and assurance activities described in the WHO policy. The DFC assurance team continues to provide DFC, Direct Implementation (DI) and Grant Letter of Agreement (LoA) assurance services throughout the Region and has visited 14 Member States4 between April 2018 and March 2019. 13. Member States are expected to collaborate with the WHO Regional and Country Offices and facilitate the effective implementation of the DFC accountability and assurance framework. Member States are also requested to expedite the submission of the outstanding DFC reports. 14. The Regional Committee took note of the report. 2 Burundi, Central African Republic, Democratic Republic of the Congo, Mauritania, Senegal, Uganda, Togo, Zambia and Zimbabwe. 3 Chad, Ethiopia, Kenya, Madagascar, Mozambique, Namibia and South Sudan. 4 Benin; Central African Republic, Democratic Republic of the Congo, Ethiopia, The Gambia, Guinea, Guinea-Bissau, Kenya, Liberia, Mali, Mauritania, Sierra Leone, South Sudan and Uganda. AFR/RC69/INF.DOC/9 Page 3 ANNEX 1A: Summary of conclusions of internal audits issued between 2011 and 2018 AFR/RC69/INF.DOC/9 Page 4 ANNEX 1B: Implementation status of Audit Recommendations for the African Region (as at 31 March 2019) Audit No. Audit Title No. of Audit Recs CLOSED RECOMMENDATIONS OUTSTANDING RECOMMENDATIONS Remarks No. of Recommendations "Closed" Total no. of "Closed" Recs No. of "Open" Recs No. of "In progress” Recs Total No. of Outstanding Recs As at 15 March 2018 16 March 2018 to 31 March 2019 (1) (2) (1) + (2) (A) (B) (A) + (B) Internal Audit 15/986 WHO Country Office in Kenya 31 30 1 31 0 0 0 Audit report closed on 9 April 2018 15/1011 WHO Country Office in South Sudan 40 27 9 36 0 4 4 Implementation in progress 16/1021 Integrated audit of WHO in Tanzania 37 34 3 37 0 0 0 Audit report closed in June 2018 16/1043 Integrated Audit of the Communicable Diseases Cluster at the Regional Office for Africa 82 23 52 75 0 7 7 Implementation in progress 16/1049 WHO Country Office in Comoros 10 6 4 10 0 0 0 Audit closed January 2019 16/1059 WHO Country Office in Ghana 17 13 4 17 0 0 0 Audit closed May 2018 17/1082 WHO Country Office in Niger 36 0 20 20 2 14 16 Implementation in progress 17/1094 WHO Country Office in the Republic of Congo 27 0 13 13 0 14 14 17/1095 WHO Country Office in Equatorial Guinea 40 0 28 28 7 5 12 17/1096 WHO Country Office in Mali 36 10 26 36 0 0 0 Audit report closed July 2018 17/1097 AFRO Procurement of Goods and Selected Services Contracts 14 0 9 9 2 3 5 Implementation in progress 17/1106 WHO Country Office in Cameroon 34 0 19 19 0 15 15 Implementation in progress 17/1113 WHO Country Office in Sierra Leone 29 0 29 29 0 0 0 Audit closed on 20 February 2019 AFR/RC69/INF.DOC/9 Page 5 Audit No. Audit Title No. of Audit Recs CLOSED RECOMMENDATIONS OUTSTANDING RECOMMENDATIONS Remarks No. of Recommendations "Closed" Total no. of "Closed" Recs No. of "Open" Recs No. of "In progress” Recs Total No. of Outstanding Recs As at 15 March 2018 16 March 2018 to 31 March 2019 18/1126 WHO Country Office in Ethiopia 62 0 30 30 7 25 32 Implementation in progress 18/1127 WHO Country Office in Nigeria 32 0 15 15 1 16 17 18/1129 WHO Country Office in Liberia 39 0 24 24 0 15 15 18/1134 WHO Country Office in Chad 45 0 16 16 0 29 29 18/1137 Integrated Audit of the Family and Reproductive Health Cluster at the Regional Office for Africa 28 0 11 11 12 5 17 18/1155 Audit of the Regional Office for Africa 28 0 0 0 28 0 28 New audit issued March 2019 Total Internal Audit Recommendations 667 143 313 456 59 152 211 External Audit EA-17- AF-20 WHO Country Office in Central African Republic 15 12 3 15 0 0 0 Audit report closed on 3 October 2018 EA-18- AF-33 Audit of the WHO Country Office in Angola 25 0 23 23 2 0 2 Implementation in progress EA-18- AF-34 WHO Country Office in Kenya 12 0 10 10 2 0 2 Implementation in progress EA-18- AF-38 WHO Country Office in Madagascar 22 0 0 0 14 8 22 New report issued in December 2018 EA-18- AF-40 Audit of the WHO Country Office in Tanzania 13 0 10 10 3 0 3 New report issued December 2018 Total External Audit Recommendations 87 12 46 58 21 8 29 GRAND TOTAL 754 155 359 514 80 160 240 AFR/RC69/INF.DOC/9 Page 6 ANNEX 2A: Number of overdue Direct Financial Cooperation (DFC) reports by country (as at 31 March 2019) ANNEX 2B: List of overdue DFC reports (15 March 2018 vs 31 March 2019) Country No. of Overdue DFC Reports as at 15 March 2018 No. of Overdue DFC Reports as at 31 March 2019 Change in No. of DFCs overdue Overdue DFC Amount in US$ as at 15 March 2018 Overdue DFC Amounts in USD as at 31 March 2019 Change in Overdue DFC Amount US$ Angola 8 3 (5) 380 189 96 407 (283 782) Benin 4 1 (3) 49 000 7087 (41 913) Botswana 0 0 No DFCs - - No DFCs Burkina Faso 9 0 No DFCs 126 459 - No DFCs Burundi 3 0 No DFCs 819 044 - No DFCs Cabo Verde 0 2 2 - 34 494 34 494 Cameroon 26 1 (25) 2 785 745 35 635 (2 750 110) Central African Republic 13 6 (7) 155 321 131 621 (23 700) Chad 8 6 (2) 306 649 1 005 121 698 472 Comoros 14 0 No DFCs 59 851 - No DFCs Congo, Republic 20 2 (18) 610 380 75 884 (534 496) Côte d’Ivoire 1 0 No DFCs 2983 - No DFCs Democratic Republic of the Congo 4 3 (1) 156 722 906 646 749 924 Equatorial Guinea 7 0 No DFCs 283 037 - No DFCs Eritrea 0 0 No DFCs - - No DFCs Eswatini 0 0 No DFCs - - No DFCs Ethiopia 20 3 (17) 4 573 875 5 676 198 1 102 323 Gabon 13 1 (12) 115 734 138 674 22 940 Ghana 2 1 (1) 55 036 94 061 39 025 Guinea 0 0 No DFCs - - No DFCs Guinea-Bissau 38 2 (36) 640 651 8829 (631 822) Kenya 6 0 No DFCs 1 660 215 - No DFCs 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 3 4 4 4 6 6 0 1 2 3 4 5 6 7 Benin Cameroon Gabon Ghana Guinea Senegal Sao Tome and Principe Tanzania Zambia Congo Cabo Verde Guinea Bissau Mozambique Sierra Leone Uganda Angola DRC Ethiopia Mali Central African Republic Chad AFR/RC69/INF.DOC/9 Page 7 Country No. of Overdue DFC Reports as at 15 March 2018 No. of Overdue DFC Reports as at 31 March 2019 Change in No. of DFCs overdue Overdue DFC Amount in US$ as at 15 March 2018 Overdue DFC Amounts in USD as at 31 March 2019 Change in Overdue DFC Amount US$ Lesotho 0 0 No DFCs - - No DFCs Liberia 1 0 No DFCs 404 915 - No DFCs Madagascar 42 0 No DFCs 832 539 - No DFCs Malawi 2 0 No DFCs 51 814 - No DFCs Mali 11 4 (7) 454 211 98 581 (355 630) Mauritania 22 0 No DFCs 213 489 - No DFCs Mauritius 1 0 No DFCs 11 419 - No DFCs Mozambique 15 2 (13) 541 369 14 664 (526 705) Namibia 0 0 No DFCs - - No DFCs Niger 3 0 No DFCs 53 177 - No DFCs Rwanda 21 0 No DFCs 381 010 - No DFCs Sao Tome and Principe 0 1 1 - 5000 5000 Senegal 5 1 (4) 34 586 6296 (28 290) Seychelles 0 0 No DFCs - - No DFCs Sierra Leone 11 2 (9) 345 979 128 812 (217 167) South Africa 0 0 No DFCs - - No DFCs South Sudan 1 0 No DFCs 469 613 - No DFCs Tanzania 1 1 - 52 152 25 493 (26 659) The Gambia 0 0 No DFCs - - No DFCs Togo 9 0 No DFCs 1 295 610 - No DFCs Uganda 27 2 (25) 3 108 426 34 621 (3 073 805) Zambia 1 0 No DFCs 6612 - No DFCs Zimbabwe 0 0 No DFCs - - No DFCs TOTAL 369 44 (182) 21 037 812 8 524 123 (5 841 902) AFR/RC69/INF.DOC/9 Page 8 ANNEX 3: Best performing country offices by size and emergency SMALL COUNTRY OFFICES MEDIUM COUNTRY OFFICES LARGE COUNTRY OFFICES EMERGENCY COUNTRY OFFICES 1. Eswatini 1. Namibia 1. Ghana 1. Sao Tome and Principe 2. Mauritius 2. Lesotho and Senegal 2. Côte d’Ivoire 2. Cameroon 3. Seychelles 3. Benin 3. Tanzania 3. Niger ANNEX 4: Breakdown of risks reported by Country Offices and Regional Office Clusters RISK AREA REGIONAL OFFICE COUNTRY OFFICES TOTAL RISKS IDENTIFIED - MID TERM REPORT NO. OF PROPOSED MITIGATION / RESPONSE ACTIONS Financial 10 25 35 20 Political/governance 7 51 58 28 Reputational 0 2 2 2 Staff, systems and structures 16 23 39 25 Strategic 6 5 11 7 Technical/public health 8 18 26 15 Total number of issues/risk identified during MTR 47 124 171 97