Honduras - Tegucigalpa municipality Public Expenditure and Financial Accountability, or PEFA (sub-national) for the Municipality of the Central District (AMDC)

 Report No: ACS4173 Republic of Honduras Tegucigalpa Municipality PEFA (Sub-National) Public Expenditure and Financial Accountability (PEFA) Assessment for the Municipality of the Central District (AMDC) June 12, 2013 PPIAF Approved Logo Usage Financial Management Unit, Operations Services Central America Country Management Unit Latin America and Logo Caribbean Region - Black P UBLIC- P RIVATE INFRA S TRUCTURE A DVIS ORY FA CILITY Logo - 1-color usage (PMS 2955) P UBLI C -P RI VATE I NF RA S TRU CT URE A DV I S ORY FA CI L I TY Logo - Reversed S TR U C TU R E A DVIS O RY FA C ILITY P U B LIC -P R IVATE IN FR A S TR U C TU R E A DVIS O RY FA C ILITY Fobidden Logo Usage P U B LI C -P R I VAT E I N F R A S T R U C T U R E A DV I S ORY FA C I LI T Y P U BL I C -P RIVATE IN FRA S TRU C TU RE A DVIS O RY FA C IL ITY P U BL IC -P RI VATE I N FRA S TRU C TU RE A DVI S O RY FA C I L I TY Document of the World Bank . . . 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All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA, fax 202-522-2422, e-mail pubrights@worldbank.org.  CURRENCY EQUIVALENTS (Exchange Rate Effective April 23, 2012) Currency Unit = Honduran Lempira (HNL) US$1.00 = HNL 19.31 MUNICIPAL GOVERNMENT FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AMDC Municipality of the Central District of Tegucigalpa ATF Administration Trust Fund BCH Central Bank of Honduras CPS Country Partnership Strategy CCIT Chamber of Commerce, Industry and Tourism CFAP Public Administration Function Classifications by the UN CFCM Collection and Financial Control Management CNBS National Commission of Banking and Insurance CODEM Emergency Council COFOG Classification of Functions of produced by the OECD and published by the UN CPI Consumer Price Index CVNP Country Vision and National Plan - Law Decree 286-2009 DEI Executive Directorate of Taxes DPMM Disaster Preparation and Mitigation Management DSA Debt Sustainability Analysis EBOs Extra-Budgetary Operations FAD Finance and Administration Directorate FLTD Fiscal and Large Taxpayers Department FM Financial Management FOSOVI Social Housing Fund GDP Gross Domestic Product GFSM Government Finance Statistics Manual of the IMF GTF Guarantee Trust Fund HNL Honduran Lempiras HRM Human Resources Management Department i IAIP Institute for Access to Public Information IFC International Finance Corporation IMF / FMI International Monetary Fund INJUPEMP National Institute of Pension and Retirement for Government staff JICA Japan International Cooperation Agency LTAIP Law on Transparency and Access to Public Information MDA Ministries, Departments and Agencies OECD Organization for Economic Cooperation and Development ONCAE National Contracting and Procurement Office PEFA Public Expenditure and Financial Accountability PEP Public Indebtedness Policy PFM Public Financial Management POA Annual Operations Plan PPIAF Public-Private Infrastructure Advisory Facility PROMDECA Municipal Facility for Livestock Processing SEFIN Ministry of Finance SEIP Ministry of the Interior and Population SEPLAN Technical Ministry for Planning and External Cooperation SGJ Ministry of the Interior and Justice SNTA Sub-National Technical Assistance TSC Honduran National Supreme Audit Institution UN United Nations USAID United States Agency for International Development UMPEG Municipal Planning and Evaluation Management Unit WB World Bank Group The World Bank Vice-President Hasan Tuluy Country Director C. Felipe Jaramillo Sector Director Elizabeth O. Adu Sector Manager Daniel Boyce Task Manager José Simón Rezk ii  Table of Contents Page Summary Assessment ................................................................................................................... 1 1. Introduction............................................................................................................................... 7 2. Municipality of the Central District of Tegucigalpa - Background ..................................... 9 2.1. Economic and fiscal situation of the municipality .............................................................................. 9 2.2. Description of the legal and institutional framework of the Municipal PFM System....................... 12 3. Assessment of the PFM systems, processes and institutions .............................................. 17 3.1. Budget credibility.............................................................................................................................. 17 PI-1. Aggregate expenditure out-turn compared to original approved budget 17 PI-2. Composition of expenditure out-turn compared to original approved budget 18 PI-3. Aggregate revenue out-turn compared to original approved budget 19 PI-4. Stock and monitoring of expenditure payment arrears 21 3.2. Comprehensiveness and transparency............................................................................................... 22 PI-5. Classification of the budget 22 PI-6. Comprehensiveness of information included in budget documentation 23 PI-7. Extent of unreported government operations 24 PI-8. Transparency of inter-governmental fiscal relations 25 PI-9. Oversight of aggregate fiscal risk from other public sector entities. 25 PI-10. Public access to key fiscal information 26 3.3. Policy-based budgeting ..................................................................................................................... 27 PI-11. Orderliness and participation in the annual budget process 27 PI-12. Multi-year perspective in fiscal planning, expenditure policy and budgeting 29 3.4. Predictability and control in budget execution ................................................................................... 30 PI-13. Transparency of taxpayer obligations and liabilities 30 PI-14. Effectiveness of measures for taxpayer registration and tax assessment 32 PI-15. Effectiveness in collection of tax payments 34 PI-16. Predictability in the availability of funds for commitment of expenditures 35 PI-17. Recording and management of cash balances, debt and guarantees 36 PI-18. Effectiveness of payroll controls 38 PI-19. Transparency, competition and complaints mechanisms in procurement 40 PI-20. Effectiveness of internal controls for non-salary expenditure 44 PI-21. Effectiveness of internal audit 46 3.5. Accounting, recording and reporting ................................................................................................ 47 iii  PI-22. Timeliness and regularity of accounts reconciliation 47 PI-23. Availability of information on resources received by service delivery units 48 PI-24. Quality and timeliness of in-year budget reports 48 PI-25. Quality and timeliness of annual financial statements 49 3.6. External Scrutiny and Audit.............................................................................................................. 51 PI-27. Legislative scrutiny of the annual budget law 52 PI-28. Legislative scrutiny of external audit reports 54 3.7. Donor Practices ................................................................................................................................. 54 3.8. Central Government Practices........................................................................................................... 55 HLG-1. Predictability of Central Government transfers 55 4. Public Sector Reform Process................................................................................................ 57 4.1. Description of the recent and current measures of reforms............................................................... 57 4.2. Institutional factors that support reform planning and application ................................................... 57 Annex 1 - Indicator Data............................................................................................................ 58 Annex A 1.1 Budget for 2009 fiscal year............................................................................................... 59 Annex A 1.2 Budget for 2010 fiscal year............................................................................................... 59 Annex A 1.3 Budget for 2011 fiscal year............................................................................................... 60 Annex A 1.4 Internal revenue performance: 2009 ................................................................................. 60 Annex A 1.5 Internal revenue performance: 2010 ................................................................................. 61 Annex A 1.6 Internal revenue performance: 2011 ................................................................................. 61 Annex 2 - Summary of performance indicators....................................................................... 62 Annex 3 - Summary of information sources............................................................................. 66 Annex 4 - Effects of performance in municipal financial management................................. 68 Annex 5 - Bibliography............................................................................................................... 70 Annex 6 - List of Stakeholders Interviewed ............................................................................. 71 Annex 7 - Technical Workshop - List of Participants ............................................................. 72 iv  Table of Indexes Page Table 1 - Main strengths and weaknesses of AMDC’s PFM 2 Table 2 - Summary table of scores 6 Table 3 - AMDC revenue structure 10 Table 4 - Fiscal Performance 12 Table 5 - AMDC expenditure performance (HNL thousands) 17 Table 6 - AMDC budget performance – Primary expenditure (HNL thousands) 18 Table 7 - Summary of revenue performance, 2009-2011 20 Table 8 - Detailed revenue performance for 2011 (HNL) 20 Table 9 - Information included in budget documents 23 Table 10 - Extent of public access to documents 27 Table 11 - Audits conducted by the Fiscal and Large Contributors Department 33 Table 12 - Accounts receivable – Financial Statements AMDC 2010 34 Table 13 - Tax collection rates, according to annual revenue performance reports (HNL million) 34 Table 14 - Elements of a strong legal and regulatory framework for procurement 41 Table 15 - Number of procurement processes registered in HONDUCOMPRAS by AMDC 42 Table 16 - Compliance with criteria for a well-functioning complaints mechanism 43 Table 17 - Transfers received from the Central Government 55 Table of Figures Page Figure 1 - Results of the 2012 PEFA Assessment ........................................................................................ 1 Figure 2 - AMDC Tax Revenue 2009-2011 ................................................................................................. 9 Figure 3 - AMDC Tax Revenue vs Other Income 2009-2011.................................................................... 10 Figure 4 - Comparison between revenue collected and budgeted expenditure........................................... 11 Figure 5 - AMDC Organizational Chart ..................................................................................................... 16 v  Preface This Public Expenditure and Financial Accountability (PEFA 1) assessment of the public finance management (PFM) systems of the Municipality of the Central District of Honduras (AMDC) was prepared by a World Bank team, working closely together with the AMDC. The study is based on the Public Financial Management Performance Measurement Framework developed by the PEFA program. It incorporates the set of 28 indicators and 69 dimensions covering the entire budget cycle, drawing on international good practices for: (i) budget credibility; (ii) comprehensiveness and transparency; (iii) budget planning; (iv) predictability and control in budget execution; (v) accounting and reporting; and (vi) external scrutiny and audit. The International Finance Corporation (IFC) is considering support to the Alcaldía Municipal del Distrito Central (AMDC) to help it access financing for basic infrastructure services without sovereign guarantee, for which a key requirement is a satisfactory financial management system. The World Bank carried out this study in support of IFC's interest, and to also provide input to the Government of Honduras’ own decentralization strategy for the country, which is also reflected in the Honduras CPS (FY12-FY14). The Public Private Infrastructure Advisory Facility (PPIAF) Trust Fund through its Sub-National Technical Assistance (SNTA) program funded this activity. The World Bank and the AMDC worked closely together during the preparation phase of the assessment. The Concept Note was approved in February 2012, and the preliminary report was reviewed in a Decision Meeting that took place in March 2013. On May 8, 2013, the team carried out a technical workshop with the participating entities, where the conclusions of the report were validated. The municipal authorities actively participated in the assessment, enabling the assessment team to interview more than twenty operational units in the Municipality, two cooperation agencies and seven central government and civil society entities. The PEFA team was led by José Simón Rezk (Financial Management Specialist, LCSFM, World Bank). Core team members were: Antonio Blasco (Sr. Financial Management Specialist, LCSFM), Hernán Pflucker and Manlio Martínez Cantor (Consultants). Peter Fairman, Helmis Cárdenas (Consultants) and Noris Salinas Reyes (WB) also contributed to the report. Quality assurance was provided through internal meetings and by the peer reviewers: Franck Bessette (Sr. Financial Management Specialist, LCSFM), Winston Cole (Sr. Financial Management Specialist, AFTME), Carolina Rendon (Public Sector Specialist, LCSPS) and José M. Rodríguez Alvarez (Sr. Public Sector Specialist, LCSPS). The preparation of the PEFA also benefited from comments and support from Giuseppe Zampaglione, Trichur K. Balakrishnan and Daniel Boyce. Comments were also received from the PEFA Secretariat, which were addressed in the report. Development partners also provided consolidated comments through the PEFA follow-up Committee within the Aid Effectiveness Technical Roundtable (comprised by the World Bank, USAID, European Commission and IADB). The authors express their appreciation to the officials of the Municipality, led by Aldo Boquín, Director, Finance and Administration Directorate, which greatly facilitated the preparation of this report through their availability and cooperation 1 http://www.pefa.org/en/content/pefa-framework vi  Summary Assessment This assessment analyzes the performance of the Municipality of the Central District of Tegucigalpa’s (AMDC) PFM systems in terms of 28 high level performance indicators (PI) grouped into six core dimensions. International best practice standards are used as benchmarks for evaluating performance. The assessment provides a baseline against which PFM system performance can be assessed in future years; improved performance is reflected in higher ratings for the PIs. The PEFA assessment also may be used to help determine whether PFM reform strategies and action plans need to be adjusted. I. Main findings Figure 1 graphically summarizes the results of the assessment. The column for each indicator shows the rating. Ratings of A indicate that PFM systems are performing at international standard level, and lower ratings indicate performance falling below international standard level. During the course of the assessment, 5 indicators were classified as NR (Not Rated), as the information available was insufficient to score the indicators. Additionally, 5 indicators were assessed as NA (Not Applicable), as these indicators are not applicable to the AMDC. Figure 1 - Results of the 2012 PEFA Assessment A B C D PI-1 PI-2 PI-3 PI-4 PI-5 PI-6 PI-7 PI-9 PI-10 PI-11 PI-12 PI-13 PI-14 PI-15 PI-16 PI-17 PI-18 PI-19 PI-20 PI-21 PI-22 PI-24 PI-25 PI-26 PI-27 PI-28 HLG M1 M1 M1 M1 M1 M1 M2 M2 M2 M2 M1 M2 M1 M2 M1 M1 M2 M1 M1 M1 M1 M1 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2010 2010 2010 2010 2010 2010 2010 2010 2010 2009 NR 2009 NR NR 2009 2009 NR 2009 2009 2009 2009 2009 NR Note: The years shown at the foot of Figure 1 indicate the years covered by the PI (e.g. PI-1 was assessed according to information covering 2009-2011). The term ‘M1’ indicates that the PI was assessed according to the ‘weakest link’ method. The term ‘M2’ indicates that the PI was assessed according to the simple average method. 1 Table 1 shows the main strengths and weaknesses of AMDC’s PFM systems. The inconsistency of the information available for the years prior to 2010 affected the measurement of several indicators. Table 1 - Main strengths and weaknesses of AMDC’s PFM Indicator Main strengths PI-5 Classification of the budget PI-17 Recording and management of cash balances, debt and guarantees PI-18 Effectiveness of payroll controls PI-22 Timeliness and regularity of accounts reconciliation PI-24 Quality and timeliness of in-year budget reports Main weaknesses PI-1 Aggregate expenditure out-turn compared to original approved budget PI-3 Aggregate revenue out-turn compared to original approved budget PI-6 Comprehensiveness of information included in budget documentation PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting PI-19 Competition, value for money and controls in procurement PI-20 Effectiveness of internal controls for non-salary expenditure PI-21 Effectiveness of internal audit PI-25 Quality and timeliness of annual financial statements PI-26 Scope, nature and follow-up of external audit PI-27 Legislative scrutiny of the annual budget law PI-28 Legislative scrutiny of external auditor reports Integrated assessment of PFM performance. Credibility of the budget (Performance Indicators 1-4) These indicators measure whether the budget is realistic and is implemented as intended. The low ratings indicate a budget that lacks credibility, with expenditure and revenue outturns very different from the approved budget. Information on PI-2 (measuring deviations from the approved budget for each budget institution) was not available, but the low ratings under PI-16 (predictability of funds available during the year to execute the budget) suggest low credibility at budget institution level as well as at aggregate level. Revenues fell far short (30 percent) of budgeted amounts in 2009 and 2010, as in the three previous years. Nevertheless, expenditure budgets have increased each year, the result being payments arrears due to budget institutions committing funds for expenditures (PI-16) when the funds were not available. Arrears eventually have to be paid off. For those outstanding at the end of the year, arrears have to be paid out of future budgets, at the expense of service delivery planned in those years. In-year budget performance reports should help managers to determine if the budget is going off track and to take remedial action. The budget classification system (PI-5) is good in principle and thus budget performance reports should be able to provide useful information to management, and they fulfill their purpose within the AMDC. Reports to Municipal Council only indicate, however, expenditures on an economic classification basis, and not on an administrative and functional basis, and managers therefore have little basis for taking remedial measures, as they don’t know how well resources are being used for delivering services. The same case is verified with reports to external entities as TSC and SEIP. 2 Comprehensiveness and transparency (Performance Indicators 5-10) These indicators measure whether the budget and fiscal risk oversight are comprehensive and whether fiscal and budget information is accessible to public. The budget classification system meets international standards, but, as indicated above, it is not used for preparing budget reports. So, neither AMDC nor the public can follow how well municipal resources are being used to deliver planned services. Management have flexibility for in-year reallocations of resources, but in a non-transparent manner, thus reducing accountability and the possibility of controlling municipal expenditure. Policy-based budgeting (Performance Indicators 11-12) These indicators measure whether the budget is prepared with due regard to government policy. Operational units in AMDC only prepare their action plans, which are revised and adjusted by the Finance and Administration Directorate (FAD), who assigns the resources to each unit. No budgetary policies are issued, and the units are not given any instructions regarding institutional priorities. The medium term vision is provided by the City Plan, but this does not contain data on costs. Financial planning is very limited and centralized and therefore the discretional component in budget preparation and execution is high. Predictability and control of budget execution (Performance Indicators 13-21) These indicators measure whether the budget is implemented in an orderly and predictable manner and there are arrangements for the exercise of control and stewardship in the use of public funds. Because funds inflows have been less than expected, cash flow is not adequate and therefore executing units may not receive the cash resources required for executing their budgets. The main control over cash allocation takes place at payment level, where discretional decisions are made regarding payments to be made (i.e. the budget is executed according to a cash rationing system). The lack of budgetary policies and pre-established priorities weakens the internal control systems and promotes splitting of contracts into sections in order to expedite purchase processes. The downside of such expediting, however, is that the costs of inputs may be higher than would have otherwise been the case in a more orderly environment; service delivery suffers as a result. Accounting, recording and reporting (Performance Indicators 22-25) These indicators measure whether adequate records and information are produced, maintained, and disseminated for purposes of decision-making, control, management, and reporting on operations. The system for recording transactions appears good (PI-24), but the annual financial statements lack credibility due to the lack of clarity of the annual accounts of previous years (PI-25). Lack of information regarding the use of municipal resources by the executing units is a weakness that compromises management accountability. 3 External scrutiny and audit (Performance Indicators 26-28) These indicators assess the arrangements for scrutiny of public finances and follow up by the executive. The audit reports prepared by TSC (Honduran National Supreme Audit Institution) and submitted to the Municipal Council (policy-making body and overall governing entity of the Municipality) comply with legal requirements. They lack depth, however, in terms of adequately identifying the internal control weaknesses of the audited institutions. Audit recommendations are followed up by the audited institutions only to a limited extent. Central Government Practices (Performance Indicator HLG-1) Compared to a typical Latin American municipality, transfers from the central government to the AMDC represent a small share of its income. The lack of predictability of the transfers in terms of amounts and timeliness, does however have an adverse impact on budget execution. II. Assessment of the impact of PFM weaknesses Aggregate fiscal discipline. Income projections tend to be inaccurate, with projections exceeding outturns. Expenditure commitments are based only on approved budgets, the result being payments arrears due to payables exceeding cash availability. The budget and budget performance reports are presented on an economic classification basis with no indication of the linkages between policy objectives, as reflected in development plans, and expenditures. Furthermore, budget performance reports do not identify how much of the budget has been committed, how much has been paid or is due to be paid, and how much has been collected. Management is therefore constrained in its ability to make informed decisions on how best to ration cash for payments in the event of income shortfalls; such decisions are therefore highly discretionary. The Municipal Council does not play a strong oversight role. Budget documentation is not provided to it in a form that facilitates a meaningful review. Moreover, it often approves budgets with insufficient income and approves accountability reports that show deficits, without requesting corrective actions. It does not follow up on the findings of external audit reports. Strategic Resource Allocation. The budget should in principle provide for a strategic allocation of resources in line with AMDC/Municipal Council objectives and priorities, but in practice this is hindered by the lack of a realistic estimation of the Municipal income. Resource allocation is ultimately limited by the lower-than-planned tax collection, with one result being that an important part of the yearly budget goes unexecuted. The budget is approved on an economic classification basis only, thereby obscuring any strategic focus. Operational units (cost centers) prepare budgets and annual operational plans consistent with objectives and priorities; however, since the budget is not prepared in a participatory manner, the resources that the FAD assigns based on cash rationing considerations often differs from operational requirements. Absence of meaningful budget performance reports (which are prepared on an economic classification basis only), hinders the ability of public finance officials to make strategic in-year adjustments to the budget in response to income shortfalls. 4 Efficient Service Delivery. Some municipal services, such as municipal infrastructure maintenance, are contracted out to third parties. Payments for these may be subject to delays, which impact negatively on both the cost and quality of services provided; as the level of services may be reduced, cancelled or interrupted. In addition, income shortfalls may lead to the budget for a particular service being re-allocated to another area of expenditure, also impacting on the quality of service delivery. Nevertheless, some primary municipal services, for example, solid waste disposal, are of high priority, and tend not to be disrupted, enabling continuous and efficient service. III. Prospects for reform planning and implementation A new political-administrative organization scheme adopted by the current Government and described in the CVNP document, promotes transferring some functions and responsibilities from the central government to the municipal sector. The AMDC is therefore preparing an integrated short and medium-term development plan. This process is backed by the current municipal administration, and by the conditions of the AMDC’s syndicated loan, which established a formal operational framework for budget preparation and execution. 5 Table 2 summarizes the scores for each dimension evaluated by this Study. Table 2 - Summary table of scores 2012 Indicator Concept PI (i) (ii) (iii) (iv) A. PFM-OUT-TURNS: Credibility of the budget PI – 1 Aggregate expenditure out-turn compared to original approved budget D D PI – 2 Composition of expenditure out-turn compared to original approved budget NR NR NR PI – 3 Aggregate revenue out-turn compared to original approved budget D D PI – 4 Stock and monitoring of expenditure payment arrears NR NR D B. KEY CROSS-CUTTING ISSUES: Comprehensiveness and Transparency PI - 5 Classification of the budget A A PI - 6 Comprehensiveness of information included in budget documentation D D PI - 7 Extent of unreported government operations NR NR A PI - 9 Oversight of aggregate fiscal risk from other public sector entities. C C NA PI-10 Public access to key fiscal information C C C. Budget Cycle c. i.) Policy based budget PI-11 Orderliness and participation in the annual budget process C+ C D A PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting D+ D B D NA c. ii) Predictability and Control in Budget Execution PI-13 Transparency of taxpayer obligations and liabilities C C B D PI-14 Effectiveness of measures for taxpayer registration and tax assessment B C B B PI-15 Effectiveness in collection of tax payments NR NR B A PI-16 Predictability in the availability of funds for commitment of expenditures D+ D A D PI-17 Recording and management of cash balances, debt and guarantees A A A A PI-18 Effectiveness of payroll controls B+ B A A B PI-19 Competition, value for money and controls in procurement D+ A D D D PI-20 Effectiveness of internal controls for non-salary expenditure D+ C D B PI-21 Effectiveness of internal audit D+ C C D c. iii) Accounting, Recording and Reporting PI-22 Timeliness and regularity of accounts reconciliation B+ A B PI-24 Quality and timeliness of in-year budget reports B+ B A B PI-25 Quality and timeliness of annual financial statements D+ D A A c. iv) External Scrutiny and Audit PI-26 Scope, nature and follow-up of external audit D+ D D B PI-27 Legislative scrutiny of the annual budget law D+ D D A B PI-28 Legislative scrutiny of external auditor reports D D D D E. Central Government Practices HLG-1 Predictability of central government transfers NR A NR C 6  1. Introduction This section describes the process and methodology used for preparing the Public Expenditure and Financial Accountability (PEFA) assessment. Objective and assessment process This assessment is a product of a coordinated process between the Municipality of the Central District (AMDC) and the World Bank. The current administration of AMDC started to reform the municipal financial system in order to improve administrative efficiency and the management of municipal funds. This reform process was supported by the establishment of a supervised process of budgetary management agreed upon as part of a municipal financing program with Honduran banks, known as the Syndicated Loan. The PEFA assessment will set a baseline for the current performance of the PFM system and help to identify windows of opportunity for reforms to the system in line with international best practices. A follow-up PEFA assessment in a few years’ time would enable assessment of progress in PFM system performance against the baseline. The participation of the Finance and Administration Directorate of the AMDC was critical to the carrying out of this assessment. It sensitized municipal officials about the merits of the PEFA methodology, thereby enabling their cooperation during the assessment exercise. Prior to the assessment process, an “Identification Mission