Public Sector Governance and Accountability Series: Budgeting and ...

330 Stephen B. Peterson
(for example, budgets and accounts). The management of data from the
user’s standpoint is standardized with common input screens and report
formats. Integration is within the core modules but is also meant to include
real-time (online) data sharing across administrative entities to promote
financial control. One limitation is that the online requirements of a conventional
IFMIS can be significantly constrained by the low bandwidth
found in many developing countries.
IFMISs are integrated two ways: in terms of data management and in
terms of modularity. Integration is both a virtue and weakness of IFMISs.
When IFMISs are integrated in terms of data management but at the same
time are not modular, this arrangement may impose a rigidity that limits
customization. Modular systems by definition can be developed by adding
independent modules as user requirements evolve, and modules can then be
linked for sharing data.
Five virtues of modularity may be noted in particular:
1. Independent development of finance components as user requirements
evolve
2. Flexible sequencing of a financial reform (budgets first; then accounts)
3. Appropriateness to the relatively unintegrated structure of public bureaucracies
in developing countries
4. Operation of different scale systems at different levels of administration
demanded by fiscal decentralization
5. Evolution of migration tools to consolidate data from different versions
of the same financial subsystem (for example, old and new chart of
accounts), thus managing a financial reform at different stages.
Modularity supports process change, which is uneven between financial
components and administrative levels.
Understanding the concept of modularity in the context of the design
and implementation of an IFMIS is important. A well-designed IFMIS will
have discrete modules (for example, budget and accounts) that are integrated.
One design issue is whether these modules are sufficiently independent
to allow multiple versions. For example, can the system provide a
single-entry and a double-entry version of accounts and consolidate both?
Even for the same module (accounts), can different versions be developed
for different administrative levels and then be consolidated? Furthermore,
can the systems operate in different configurations: stand-alone configurations,
local area network (LAN), and wide area network (WAN)? IFMISs
have to be significantly customized to meet the varied demands of a financial