GAAP Matrix

Issue Risk and Rating Mitigating Actions AlreadyTaken or Included(and Estimated Cost*)2. Unjustified paymentsmade for incompleteand/or sub-standardwork, or substandardquality ofgoods delivered(Moderate)Qualified and experiencedengineers will be providedand held to strict rules thatthey ensure that paymentsmatch quality of work done,or products purchasedAdditional Mitigation ActionsProposed, Responsible Agency (andEstimated Cost*)Responsibilities of PHED (engineerson deputation) and consultants (forinspection) will be tightly definedand enforced;Third party consultants will beengaged for quality assurance ($1.2M)Schedule and Milestonesof GAAP Actions*Consultants and thirdpartyinspectors will behired as a pool at MSUfrom the project startE. FinancialManagement Systemand InternalControls1. Delayed andincomplete reportingof expenditures bymultipleimplementingagencies, leading topoor planning andcontrol (High)Monthly reporting system ismandated at the ULB levelCloser follow-up and monitoringfrom CDMA (principal implementingagency); Supervision consultants tohelp report;suspension of disbursement whenreports overdueThis procedure will bemade a part of subloancontracts from projectstart2. External auditors(CAG) provide an auditcertificate but do notprovide independentaudit opinion noridentify internalcontrol issues as partof the certificationexercise (High)This is a systematic issue forthe country as a whole andits resolution will continuebe sought at the nationallevelPrivate auditors will be hired for ULBaudits (approx. $500,000);management consultants hiredunder the Capacity Enhancementcomponents will be asked to provideobservations and recommendationson control issues ($3 M)Private auditors alreadybeing hired.The TA to start in year 1