Project Administration Manual: Project Number: 41373 Grant Number: September 2010

Draft: 08/09/2010
Project Administration Manual
Project Number: 41373

Grant Number:
September 2010
Proposed Grant Assistance

Kingdom of Cambodia: Public Financial
Management for Rural Development Project 2
Contents
ABBREVIATIONS 1
I. PROJECT DESCRIPTION 2
A. Summarize the project's rationale, location and beneficiaries. 2
B. Project Components 3
II. IMPLEMENTATION PLANS 6
A. Project Readiness Activities 6
B. Overall Project Implementation Plan 7
III. PROJECT MANAGEMENT ARRANGEMENTS 10
A. Project Stakeholders – Roles and Responsibilities 10
B. Project Organization Structure 11
C. Key Persons Involved in Implementation 13
IV. COSTS AND FINANCING 13
A. Cost Estimate by Expenditure Category 14
B. Allocation and Withdrawal of Grant Proceeds 14
C. Expenditure Accounts by Financier 17
D. Expenditure Accounts by Outputs/Components 18
E. Expenditure Accounts by Year 19
F. Contract and Disbursement S-curve 20
G. Fund Flow Diagram 21
V. FINANCIAL MANAGEMENT 22
A. Financial Management Assessment 22
B. Disbursement 22
C. Accounting and Reporting 23
D. Auditing 23
VI. PROCUREMENT AND CONSULTING SERVICES 23
A. Procurement of Goods, Works, and Consulting Services 24
B. Procurement Plan 24
C. Process Thresholds, Review and 18-Month Procurement Plan 24
D. Indicative List of Packages Required Under the Project 26
E. National Competitive Bidding 27
F. Consultant's Terms of Reference 28
VII. SAFEGUARDS 44
VIII. PERFORMANCE MONITORING 46
A. DESIGN AND MONITORING FRAMEWORK 46
B. Stakeholder Communication Strategy 49
IX. ANTICORRUPTION POLICY 49
X. ACCOUNTABILITY MECHANISM 49
XI. RECORD OF PAM CHANGES 49
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Project Administration Manual Purpose and Process
The project administration manual (PAM) describes the essential administrative and management
requirements to implement the project on time, within budget, and in accordance with Government and Asian
Development Bank (ADB) policies and procedures. The PAM should include references to all available
templates and instructions either through linkages to relevant URLs or directly incorporated in the PAM.
The Ministry of Economy and Finance (MEF) and the National Audit Authority (NAA) (executing agencies),
Council of Administrative Reforms (CAR), Ministry of Agriculture, Forestry and Fisheries (MAFF), Ministry of
Water Resources and Meteorology (MOWRAM), and Ministry of Rural Development (MRD) (implementing
agencies) are wholly responsible for the implementation of ADB financed projects, as agreed jointly between
the recipient and ADB, and in accordance with Government and ADB’s policies and procedures. ADB staff is
responsible to support implementation including compliance by MEF and NAA (executing agencies), CAR,
MAFF, MOWRAM, and MRD (implementing agencies) of their obligations and responsibilities for project
implementation in accordance with ADB’s policies and procedures.
At Grant Negotiations, the recipient and ADB shall agree to the PAM and ensure consistency with the Grant1
agreement. Such agreement shall be reflected in the minutes of the Grant Negotiations. In the event of any
discrepancy or contradiction between the PAM and the Grant Agreement, the provisions of the Grant
Agreement shall prevail.
After ADB Board approval of the project's report and recommendations of the President (RRP) changes in
implementation arrangements are subject to agreement and approval pursuant to relevant Government and
ADB administrative procedures (including the Project Administration Instructions) and upon such approval they
will be subsequently incorporated in the PAM.
1
The name of the operational financing document may vary on a project to project basis; this reference
shall be deemed to encompass such variations, e.g., a Framework Financing Agreement, as applicable.
Abbreviations
ADB – Asian Development Bank

ADF – Asian Development Fund
APR – audit peer review
BOP – balance of payment
BSP – budget strategic plan
CAR – Council of Administration Reforms
CBP – capacity building plan
DIC – Department of Investment and Cooperation
DMFAS – Debt Management and Financial Analysis System
EFI – Economics and Finance Institute
FMIS – financial management information system
GDP – gross domestic product
GGF – Good Governance Framework
MAFF – Ministry of Agriculture, Forestry and Fisheries
IAD – Internal Audit Department
IT – information technology
MBPI – Merit-based pay initiative
MDG – Millennium Development Goal
MEF – Ministry of Economy and Finance
MOA – Ministry of Agriculture
MOF – Ministry of Finance
MOWRAM – Ministry of Water Resources and Meteorology
MRD – Ministry of Rural Development
MTEF – Medium-Term Expenditure Framework
NAA – National Audit Authority
NSDP – National Strategic Development Plan
NPAR – National Program for Administration Reforms
PEFA – Public Expenditure and Financial Accountability
PFM – public finance management
PFMRDP – Public Finance Management for Rural Development Program
PFMRP – Public Finance Management Reform Program
PIU – project management implementing units
PM – Procurement Manual
PSC – program steering committee
QCBS – quality- and cost based selection
RDM – rural development ministry
RSG – Rectangular Strategy Growth
RCS – Reform Committee Secretariat
SAI – supreme audit institution
SAW – Strategy for Agriculture and Water
SOP – Standard Operating Procedure
SCS – Steering Committee Secretariat
TA – technical assistance
2
I. PROJECT DESCRIPTION
A. Summarize the project's rationale, location and beneficiaries.
1. The main objective of the grant assistance (the Project) is to support the implementation
of the Public Finance Management Reform Program (PFMRP). The institutional and capacity
building project (the Project) has been designed to support public financial management (PFM)
reforms, over the medium-term. The sequencing of the project activities will be coordinated with
the platform approach of the PFMRP and will provide for appropriate sequencing, required
synchronization, and desired flexibility to ensure success. The Government of Cambodia
requested that ADB provide grant assistance to support institutional and capacity development
over the medium-term, building on the ongoing support for capacity development in PFM in the
three rural development ministries (RDM) – Ministry of Agriculture, Forestry, and Fisheries
(MAFF), Ministry of Rural Development (MRD), and Ministry of Water Resources and
Meteorology (MOWRAM) – and by the Economic and Finance Institute (EFI) of the Ministry of
Economy and Finance (MEF). Implementation of the Stage 2 of PFMRP requires sustained
technical inputs and targeted on-the-job support to equip the three rural development ministries
with the required knowledge and skills to ensure that the results of the reforms will be sustained.
The Government also requested grant support to further strengthen implementation of public
debt management strategy and to continuing support to the National Audit Authority (NAA).
NAA will be supported to improve its audit capacity as it has a fundamental role in improving the
quality of financial governance, reinforcing institutional oversight and providing critical checks
and balances in the management of public finances. In addition, the Government also
requested support specific capacity development activities in implementing the National Public
Administration Reforms (NPAR).
2. The Project will have four components to support PFM reforms in the medium-term. The
first project component will support rural development ministries (MAFF, MRD, and MOWRAM
or collectively, the RDMs) to implement and monitor key reforms to PFM with the focus on
enhancing budget planning, budget execution including procurement, accounting, reporting,
internal audit, and monitoring and evaluation. The second component will support the Council
for Administrative Reforms (CAR) to implement selected activities consistent with the priorities
of the National program for Administrative reforms (NPAR 2009–2013). The third component will
support government's ongoing efforts to strengthen the macro fiscal framework, and will include
support to further strengthen capacity in public debt management in the Government will also be
a critical area of support, following up the progress achieved from the ongoing project support
on debt management. The fourth component will provide continuing support to the NAA to
strengthen audit capacity in selected areas of audit, building upon the recommendations of the
external audit peer review. Project implementation period will be from January 2011 to March
2013.
3. Types of assistance will be in form of inputs such as: (i) engagement of international and
national consultants with relevant competencies in core PFM areas including internal audit and
procurement for externally-assisted projects (SOP/FM/PMM) debt management, human
resource management, monitoring and evaluation, and public audit; (ii) long-term mentor
support; (iii) training (classroom, ministry specific workshop, on the job, selected international
training, both long-term and short-term, subject to resource availability), workshops, seminars,
and study tours; iv) provisions of materials and equipment, including computer hardware and
software; and (v) project management requirements.

3
B. Project Components
4. Details of the 4 project components are:
1. Component 1: Improved PFM Capacity in RDMs (MAFF, MRD, and MOWRAM).

The aim is to assist to implement activities under the PFMRP consolidated action
plan for Stage 2 (CAP 2) and ministry action plans under Stage 2 in close
coordination with PFM Working Groups. The activities will be consistent with the
objective and key performance indicators, and key targets of PFMRP – Platform
1 (Stage 1) action plan to be further strengthened in stage 2; platform 2 (Stage 2)
to be implemented in stage 2 and Action plan for following platforms to be
gradually started. The background and foundational training common to all
program ministries should be broadened to include participation from all
ministries, subject to resource availability. This component will continue to:
a. Provide specific project activities related to budget formulation (including

Ministry Budget Strategic Plans and medium-term expenditure framework
(MTEF)), budget execution (including procurement under deconcentrated
procedures, delegated commitment, and transaction processing), and
budget accounting and reporting (budget classifications and chart of
accounts, and needed support for FMIS pilot), building upon capacity
development recommendations made under the project preparatory
technical assistance (PPTA) 4988-CAM, and the specific suggestions of
ADB Grant 0133-CAM consistent with the key targets of stage 2 of
PFMRP.
b. Support capacity development and project management effectiveness of
the project management units (PMUs)/project implementing units (PIUs)
in implementing standard operating procedure (SOP)/PM/FMM and GGF.
c. strengthen monitoring and evaluation and support capacity of relevant
staff of the Planning Department in MFDR.
d. Support the PFM Coordination Working Group and provide relevant
support in implementation of Ministerial Action Plans and support Ministry
specific capacity development support in areas to be mutually decided.
e. Support implementation of audit plans as a useful management tool to
improve financial controls and procedures. Support internal audit
planning, methodologies and reporting and internal audit capacity of the
internal audit departments, including pilot audit. Strengthen institutional
coordination and communication with the National Audit Authority and the
Internal Audit Department of the MEF on internal control processes, and
internal audit activities. Support improved management review of internal
audit findings.
f. Provide support to (i) develop M&E manual for RDMs to use; (ii) Project
Database Management System for M&E purposes, (iii) strengthen M&E
technical capacity for RDMs' staff through series of TOT and further
training courses to other M&E staff in central as well as provincial level;
(iv) develop core monitoring indicators & design data collection, and M&E
reporting etc.
g. Support capacity to implement a Results Based Monitoring Framework
linked to indicators in the national strategic development plan (NSDP)
providing Information for evaluation of the outcomes of the Rural
Development Strategy with the following outputs: (i) an institutional
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framework for Monitoring that delineates the mandates and

responsibilities within and between MRD, MOWRAM, and MAFF
including the linkages with the MEF and the Ministry of Planning; (ii) data
Collection Systems and Processes for each Indicator that elaborates the
details of data source, collection methodology, frequency of data
collection, responsibility for data collection, aggregation and storage
process; (iii) a data transfer methodology between the Sector and
Central Agencies that is based on protocols of aggregation; and (iv)
analysis, reporting, and use of performance information methodology that
will enable data to used for evaluation. The outputs will be supported with
capacity development for selected staff engaged in planning, monitoring,
and evaluation.
h. Coordinate with ADB TA 7373-CAM: Developing an Institutional
Framework for Decentralization Reforms, and work with D&D Working
Group on de-concentrated and fiscal aspects.
i. Coordinate with Gender Action Groups and PFM working groups for
increasing awareness about gender-sensitive monitoring, planning and
budgeting as appropriate.
j Coordinate with DIC in providing training to all line ministries and
government agencies in updated SOP/PM/FMM, building on precursor
work (Grant 0133).
2. Component 2: Support to the Council of Administrative Reforms. Project will

support capacity development, targeting two possible areas to (i) train managers
and to develop a core group of experts; and (ii) undertake an operational needs
assessment to inform on a longer term strategy to develop capacity. Technical
assistance is urgently required to support the development of the program and
prepare for implementation within the scope of the draft National Program for
Administrative Reform 2009 – 2013.
3. Component 3: Strengthening Debt Management within the MEF Department of

Investment and Cooperation (MEF-DIC). The aims are to build up capacity
through capacity building plan (CBP) in public debt management (PDM) needed
to develop an annual budget strategy, improve the quality of domestic and
foreign debt records and reporting through enhanced use of Debt Management
and Financial Analysis System (DMFAS), and assist the Royal Government in
the implementation of the public debt sub-decree.
• The CBP will focus on knowledge enhancement within MOF-DIC. The

knowledge enhancement will be done in two parts: internal and
externally. Internal CBP will focus on increasing soft skills and upgrading
the equipment used for PDM. Ability to conduct a proper debt
sustainability analysis (DSA) for annual debt strategy and risk
management analysis (e.g. credit risk analysis, currency risk analysis,
interest rate risk analysis) on debts are soft skills needed in CBP. The
external trainings will focus on short-term oversea training courses and
international conference/forum on PDM for selected officials. The
component will also provide scholarships, through a competitive process,
for two to three staff of MOF-DIC to enroll in a Master degree that
focuses on public policy analysis (preferably in PDM) in an accredited
overseas University.

5
• As for the full utilization of DMFAS, Component 3 will upgrade the current
DMFAS system (ver.5.3) to ver.6, expand the use of DMFAS to other
institutions/agencies/departments/general departments of MEF (such as
the General Department of National Treasury, the Economic and
Financial Policy Department, and possibly the Budget Department), and
procure computers and other hardware that are needed to support the
use of DMFAS in the other institutions. It will also help MEF-DIC to
access continuous training in the use of DMFAS debt, DMFAS database
management, and assist in increasing use of DMFAS and strengthen the
Reporting System of MEF-DIC's Debt Management Unit.
• In strengthening the legal and institutional framework, Component 3 will

provide assistance to the government on the implementation of the Public
Debt sub-decree. The Ministerial Regulations/Minister's Prakas will
implement the Sub-Decree on Public Debt Management. This will be
drafted and put into implementation in Phase 2 of the Program. In
particular, more assistance will focus on implementation arrangement of
the middle office, i.e. should the office be integrated within MEF-DIC or
should it be set up as fully functional Debt Management Office (DMO).
4. Component 4: Continued Assistance to the NAA. The aim is to support to the

NAA to strengthen its operations and support capacity building of its auditors
within the compass of the National Audit Authority Strategic Development Plan
(NAASDP), consistent with the audit priorities resulting from the Peer Review
Recommendations, and to meet emerging challenges such the audit of sub
national institutions and Commune Councils. The peer review has commenced,
and will assess the extent to which NAA's audit and management practices
reflect recognized professional standards and are operating effectively to carry
out audit; produce independent, objective and sustainable reports; and provide
a platform or sustained capacity developments. In addition, the project will
improve the institutional arrangement with the Commission on Economy,
Finance, Banking and Audit2 , and also selectively support implementation of the
implementation of the proposed subdecree based on the Audit Law.
2
Also called as the Second Commission

6
II. IMPLEMENTATION PLANS
A. Project Readiness Activities
Months
Indicative Activities 1 6
(July) 2 3 4 5 (Dec) Who is responsible
Advance contracting actions X X X ADB U
Retroactive financing actions Not applicable
Establish project
implementation arrangements X EAs and IAs
ADB Board approval X ADB U
Grant signing X EAs/CARM/MEF
Government legal opinion
provided X MEF/CARM
Government budget inclusion X EAs and IAs
Grant effectiveness RGC/CARM/OGC/ADB
X U
ADB U = Asian Development Bank's supervising unit, CARM = Cambodia Resident Mission, MEF = Ministry of
Economy and Finance, OGC = Office of the General Counsel, RGC = Royal Government of Cambodia

7
B. Overall Project Implementation Plan

Indicative Activities Yr 1 Yr 2 Yr 3 Yr 4
(Activities are only indicative, and will be finalized during the inception phase of the project based on updated Action Plans of (Mth/Qtr) (Mth/Qtr) (Mth/Qtr) (Mth/Qtr)
EAs, and IAs).
Component 1: Improved PFM Capacity in RDMs (MAFF, MRD, and MOWRAM). The aim is to assist in
implementing activities under the PFMRP CAP 2 and ministry action plans under Stage 2 in close coordination
with PFM Working Groups.
Activity 1.1- Continue to provide specific project activities related to budget preparation (including Ministry Budget
Strategic Plans and MTEF) budget execution (including procurement under deconcentrated procedures,
delegated commitment, and transaction processing), and budget accounting and reporting (budget classifications
and chart of accounts), building upon capacity development recommendations made under the PPTA 4988-
CAM, and the specific suggestions of Grant 0133-CAM consistent with the key targets of CAP 2 of stage .
Activity – 1.2 Continue to support capacity development and project management effectiveness of the
PMUs/PIUs in implementing SOP/PM/FMM and GGF
Activity -1.3- Continue to strengthen the capacity of relevant staff to apply results based approaches to public
financial management with special focus on planning, budgeting and monitoring and evaluation
Activity – 1.4- Continue to support the PFM Coordination Working Group and provide relevant support
Activity – 1.5- Continue to support internal audit planning, methodologies and reporting and internal; audit
capacity of the Internal audit departments, including pilot audit and accompany the internal audit team of three
RDMs selectively, and support implementation of audit plans as a useful management tool to improve financial
controls and procedures
Activity 1.6 – (i) Develop M&E manual for RDMs to use; (ii) Project Database Management System for M&E
purpose, (iii) Strengthening M&E technical capacity for RD Ms' staff through series of TOT and further training
courses to other M&E staff in central as well as provincial level; (iv) Developing core monitoring indicators &
design data collection, and M&E reporting etc;
Activity 1.7 – Support the development of a comprehensive results based M&E Framework for the rural
development sector (RDS) through supporting a network or community of practice (CoP) of relevant staff in
MAFF, MOWRAM,MRD and MEF and Ministry of Planning to formulate a road map for a comprehensive M&E
framework, through a series of workshops and seminars engaging international experts and regional practioners
in M&E. Amongst other things the project will help the CoP will (i) formulate the t core monitoring indicators and
targets for the rural development sector consistent with the Rectangular Strategy and the indicators in the NSDP
and the Strategy for Agriculture and Water (SAW) (ii) develop the institutional framework for coordinating M&E
between the above ministries to allow for a rural development sector perspective as opposed to institutional M&E
(ii) build on the capacity development of the M&E capabilities provided in ( c) above through series of TOT and
further training courses to other M&E staff in central as well as provincial level; (iii) guide the establishment of the
M&E data collection, recording and reporting systems including an M&E manual
Activity 1.8 – Coordinate with ADB D&D TA, and work with D&D Working Group on de-concentrated and fiscal
aspects
Activity 1.9 - Coordinate with DIC in providing training to all line ministries and government agencies in updated
8
EAs, and IAs).
SOP/PM/FMM, building on precursor work (Grant 0133)
Activity 1.10 – Coordinate with the P{FM Working Groups for implementation of Gender Action Plans and improve
awareness of gender related issues.
Component 2: Support to the Council of Administration Reforms. Activities will support three possible areas to -
train managers,(ii) to develop a core group of experts; and (iii) to undertake an operational needs assessment to
inform on a longer term strategy to develop capacity
Activity 2.1 – Train Managers - Commence training of bureau chiefs
Activity 2.2 – Train Managers - directors and deputy directors
Activity 2.3 – Train Managers - secretaries and directors general and their deputies
Activity 2.4 – commencement of preparatory works to undertake an operational need assessment.
Activity 2.5 - Analyze relevant documentation including recent training programs such as the Economic and Public
Sector Capacity Building Project (EPSCB) of the World Bank and the Institutional Support Program (ISP) of the
European Commission;
Activity – 2.6 -Assist the design of a training program including training modules addressing the development of
core management competencies;
Activity -2.7 -Assist a consultation process involving stakeholders;
Activity 2.8 - Assist in the finalization of the training program and training modules;
Activity -2 .9 - Assist in the design of an implementation plan and related budgets;
Activity – 2.10 -Assist in the design and establishment of requisite management and monitoring mechanisms;
Activity – 2.11- Assist in the design and establishment of a communications strategy

Activity – 2.12 - Facilitate the transfer of knowledge to counterparts.
Activity – 2.13 - develop the program including curriculum, training materials, implementation plan and monitoring
and evaluation frameworks
Activity – 2.14 - holding training sessions involving 1,000 participants in topical workshops over a period of one
year (including training trainers)
Activity – 2.15 - a mentoring program involving CAR Secretariat staff and local experts
Activity – 2.16 – carrying out surveys to assess impact of training
Component 3: Strengthening Debt Management within the Ministry of Economics and Finance Department of
Investment and Cooperation (MEF-DIC). The aims are to build up capacity through Capacity Building Plan (CBP)
in Public Debt Management (PDM) needed to develop an annual budget strategy, improve the quality of domestic
and foreign debt records and reporting through enhanced use of Debt Management and Financial Analysis System
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EAs, and IAs).
(DMFAS), and assist the Royal Government in the implementation of the public debt sub-decree.
Activity 3.1 –Providing detailed strategic recommendations, technical advice, and on-the-job training to MEF
departments/units concerned to strengthen integrated public debt management functions, based on thorough
review of prevailing practices in Cambodia and on account of international best practices.
Activity 3.2 – Providing assistance to MEF in further enhancing institutional and capacity development of Debt
Management Office (DMO).
Activity 3.3 – Providing assistance in strengthening “middle office” functions
Activity 3.4 - Preparing and implementing a training plan in debt sensitivity Analysis; risk management analysis for
middle office staff and enhanced use of DFMAS database
Activity 3.5 - Providing continue technical assistance in further reviewing legal framework of debt management
and public debt management strategy, and in the preparation of regular debt reports;
Activity 3.6 – Supporting implementation of CAP and DAC Activities
Activity 3.7 – Providing assistance in organizing training and workshop
Activity 3.8 – Performing any other tasks required in implementing the project, including assisting ADB missions, to
help achieve the objectives and goals of the PFMRD within the approved budget.
Component4: Strengthening External Audit as a Pillar of Public Accountability. The aim is to support to the
National Audit Authority to strengthen its operations and support capacity building of its auditors within the
compass of the National Audit Authority Strategic Development Plan (NAASDP), consistent with the audit priorities
resulting from the Peer Review Recommendations, and to meet emerging challenges such the audit of sub
national institutions and Commune Councils. The project will improve the institutional arrangement with the 2
Commission, and also selectively support implementation of the implementation subdecree based on the Audit
Law.
Note: Activities will be finalized after the finalization of the Action Plan based on Peer review
recommendations
A. Management Activities
Procurement plan key activities to procure contract packages
Advance contracting for consulting services
Environment management plan key activities
Communication strategy key activities
Annual/Mid-term review
Project completion report
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III. PROJECT MANAGEMENT ARRANGEMENTS
A. Project Stakeholders – Roles and Responsibilities
5. Project Implementation arrangements .MEF, as the EA for Components 1, 2, and 3,

will be responsible for the overall coordination of activities under these components and will
carry out project administrative and fiduciary support, and meet the Government’s and ADB’s
reporting requirements on the progress and use of the Project funds. The PFMRP Steering
Committee Secretariat, including the Department of Investment and Cooperation (responsible
for Component 3 activities), as well as relevant operational staff shall act as the Project
Management Unit (PMU). MAFF, MRD, MOWRAM, and CAR shall be the IAs. The PFM
Reform Working Group of MAFF, MRD, and MOWRAM and Project Steering Group under the
Secretary-General, CAR, assisted by the Deputy Secretary-General, CAR, and Department of
Investment and Cooperation for Component 3 (public debt) activities shall act as the Project
Implementation Unit (PIU) for their respective activities. NAA shall be the EA for Component 4
and the NAA’s PMU comprising a senior staff member as the head and relevant counterpart
staff shall implement Component 4. The PSC of the Program shall also act as the Project
steering committee to oversee the Project and provide overall direction and policy guidance.
1. Components 1 and 3
6. The PFMR Steering Committee, chaired by MEF Secretary of State in which Director
General (DG) or Secretary General in charge of Finance from all ministries are members, will
continue as the project steering committee (PSC) responsible for coordinating project
implementation for all components. The Ministry of Economy and Finance Reform Commission
(MEFRC) chaired by Secretary of State in which all directors of MEF are members will continue
to provide technical level monitoring and to support the PSC. The Reform Committee
Secretariat (RCS), renamed as the Steering Committee Secretariat (SCS) will serve both the
PFMSC and MEFRC and support and assist MEF departments and the PFM Reform Working
Groups (PFMRWG) of MRD, MAFF, and MOWRAM for Component 1, CAR for Component 2,
DIC for Component 3, and NAA for Component 4 for implementation related issues as required.
7. The MEF, as the Project Executing Agency, will be responsible for the overall
implementation of Components 1, 2 and 3 below. Key implementing agencies are MRD, MAFF,
MOWRAM, and the Department of Investment and Cooperation (DIC) in MEF. The SCC and
DIC will coordinate for project administration, disbursements, maintenance of all project records,
and for submission of progress reports to the PSC and the ADB.
2. Component 2
8. The Council of Administrative Reforms will exercise project oversight through the project
Steering Group under the Chairmanship of the Secretary General of the Council of
Administrative Affairs, and the Project Management Group (PMG) under the Deputy Secretary
General will be responsible for project administration. The PMG will coordinate with MEF (DIC)
for withdrawals and disbursements, and will be responsible for maintenance of all project
records, and will submit progress report to the PSC and the ADB.
3. Component 4
9. The NAA will be the Executing Agency for Component 4 respectively. The Project
Management Unit (PMU), working under the overall supervision of the Auditor-General and

11
under the direct supervision of the Secretary-General of the NAA will be responsible for project
implementation. The PMU will coordinate with MEF (DIC) for withdrawals and disbursements,
and will be responsible for maintenance of all project records, and will submit progress report to
the PSC and the ADB.
B. Project Organization Structure
National Audit Project Steering Committee Council of

Authority (Ministry of Economy and Finance) Administrative
Secretary of State Reforms
Project Organization Structure for Project Organization Structure for

Component 4 Component 2
H.E.AG
PMU-NAA
H. E. AG = Uth Chhorn, PMU-NAA =

Project Management Unit-National Audit PMU-CAR: Project Management Unit of
Authority. the Council of Administrative Reforms
Project Organizational Structure for Components 1, 3
Council for Administration Reform PFM Reform Steering Committee
DIC
Steering Committee Secretariat
Implementation and Coordination
PFMRWG-MRD PFMRWG-MAFF PFMRWG-MOWRAM
Team of Consultants engaged through ADB projects
DIC = Department of Investment and Cooperation, PFM = public financial

management, PFMRWG-MRD = Public Financial Management Reform Working Group
12
Project Stakeholders Management Roles and Responsibilities
Executing Agencies:
Ministry of Economy and Finance
¾ Responsible for overall coordination of activities
under Components 1, 2, and 3
¾ Carry out project administrative and fiduciary
support and meet Government's and ADB's
reporting requirements on the progress and use
of project funds
¾ responsible for submission of the withdrawal
applications, retention of supporting documents,
and submission of the annual audit report and
financial statements
¾ National Audit Authority
¾ Responsible for activities under Component 4
under Component 4
¾ responsible for submission of the withdrawal
applications, retention of supporting documents,
and submission of the annual audit report and
financial statements through MEF
Implementing Agencies:
Council of Administration Reforms
¾ Organize and implement a program to train
managers
¾ Carry out an operational needs assessment
under Component 2
Ministry of Agriculture, Forestry and Fisheries (MAFF)

¾ Implement activities under the PFMRP
consolidated action plan for Stage 2 (CAP)
Ministry of Rural Development (MRD)

Ministry of Water Resources and Meteorology (MOWRAM)

¾ ADB
¾ Assist in implementing the PFMRP at the three
rural development ministries including the
selection and engagement of consultants

13
C. Key Persons Involved in Implementation
Executing Agencies
Ministry of Economy and Finance H.E. Mr. Vongsey Vissoth

¾ DIC Secretary General
Ministry of Economy and Finance
St. 92, Sangkat Wat Phnom, Phnom Penh, Cambodia
National Audit Authority H.E. Ouk Saravudh

Secretary General
Tel. No. +855 23 215 320
Email Address naakh@naa.gov.kh
No. 16, Street 240 Sangkat Chaktomuk Khan Duan Penh
ADB
Division Director Jaseem Ahmed

Director, SEFM
+632 6326465
jahmed@adb.org
Mission Leader Prasanna Kumar Jena

Senior Governance Specialist, SEFM
+632 6326657
pjena@adb.org
IV. COSTS AND FINANCING
10. The project is estimated to cost $5.5 million. This includes ADB contribution of $5 million
and Government contribution of $0.5 million in kind for office accommodation, counterpart staff
salaries, facilities, and other support. The cost estimates are summarized in Table 1 below.
Table 1: Project Investment Plan

($’000)
a
Component Total Cost
A. Base Cost
1. Consultants 2,482.00
2. Equipmentb 322.00
3. Trainingc 1,580.00
4. Project Management Supportd 679.00
Subtotal (A) 5,063.00
B. Contingenciese 437.00
Subtotal (B) 437.00
Total 5,500.00
a.
Includes applicable taxes, duties, and bank charges amounting to $40,000.
b.
Includes computers, printers, LCD projectors, computer software, vehicles, and photocopiers.
c.
Provision for training seminars and study tours.
d
Includes costs for contract negotiations, preparation of report, communications, translation, project management
cost to be financed by ADB ($179,000) and Government financing (office accommodation, counterpart staff
salaries, meeting facilities and others) initially estimated at $0.5 million in kind.
e
Contingencies at approximately 9% for base costs.
Source: Asian Development Bank.
14
A. Cost Estimate by Expenditure Category
Table 2: Detailed Cost Estimates by Expenditure Category

($’000)
Item Foreign Local Total % of Total Base
Exchange Currency Cost Cost
A. Investment Costs a
1. Civil Works - - -
b
2. Mechanical and Equipment 322.00 - 322.00 5.85
3. Environment and Social Mitigation - - - -
4. Consultants 2,482.00 - 2,482.00 45.13
a. Project Management c 179.00 - 179.00 3.25
b. Capacity Development 1,580.00 - 1,580.00 28.73
Subtotal (A) 4,563.00 - 4,563.00 82.96
B. Recurrent Costs
1. Salaries - - - -
2. Accommodation - - - -
3. Equipment Operation and 500.00 - 500.00 9.09
Maintenance
Subtotal (B) 500.00 - 500.00 9.09
Total Base Cost 5,063.00 - 5,063.00 92.05
C. Contingenciesd
1. Physical 437.00 - 437.00 7.95
2. Price - - - -
Subtotal (C) 437.00 - 437.00 7.95
D. Financing Charges During
Implementation
1. Interest During Implementation - - - -
2. Commitment Charges - - - -
Subtotal (D) - - - -
Total Project Cost (A+B+C+D) 5,500.00 - 5,500.00 100.00
– = data not available.
NOTE: Total project cost does not include government financing.
a
In mid-2010 prices
b
Equipment under component 1 includes: 6 desktops; 3 servers; 3 B/W printers ; 8 laptops; 3 colored printers; 3
vehicles; 1 LCD projector; 3 photocopiers; and software for MRD, MAFF, and MOWRAM; Equipment under
component 2 includes: 2 computers, 1 photocopier, and 1 printer; Equipment under component 3 includes: 2
servers; 2 desktops; 1 B/W printers; 2 laptops; 1 colored printer; 1 photocopier; and software; and Equipment
under component 4 includes: 14 computers, 1 B/W photocopier, and 1 colored photocopier.
c
Project Management under component 1 includes: Misc. admin and support costs (including Project coordinator
on a contractual basis) to be incurred by the EA and the Firm; Project Management under component 2 includes:
report and info materials; project administration cost (including Project coordinator on a contractual basis);
Project management under component 3 includes: project admin cost (including project coordinator on
contractual basis); and translation services and Project management under component 4 includes: report and
info materials, project admin costs, and translation services.
d
Computed at 10% for field research and development, training, surveys and studies.
B. Allocation and Withdrawal of Grant Proceeds
(i) General

15
11. Table 3 under this section sets forth the Categories of Goods, consulting services and
other items of expenditure to be financed out of the proceeds of the Grant and the allocation of
amounts of the Grant to each such Category (hereinafter called Table 3). (Reference to
"Category" or "Categories" in this section is to a Category or Categories of the Table and
reference to "Subcategory" or "Subcategories" in this Section is to a Subcategory or
Subcategories of a Category).
(ii) Percentages of ADB Financing
12. Except as ADB may otherwise agree, the items of the Categories and Subcategories
listed in the Table shall be financed out of the proceeds of the Grant on the basis of the
percentages set forth in the Table.
(iii) Reallocation
13. Notwithstanding the allocation of Grant proceeds and the withdrawal percentages set
forth in the Table,
(a) If the amount of the Grant allocated to any Category appears to be insufficient to
finance all agreed expenditures in that Category, ADB may, by notice to the
Recipient, (i) reallocate to such Category, to the extent required to meet the
estimated shortfall, amount of the Grant which have been allocated to another
Category but, in the opinion of ADB, are not needed to meet other expenditures,
and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the
withdrawal percentage applicable to such expenditures in order that further
withdrawals under such Category may continue until all expenditures there under
shall have been made; and
(b) if the amount of the Grant then allocated to any Category appears to exceed all
agreed expenditures in that Category, ADB may, by notice to the Recipient,
reallocate such excess amount to any other category.
(iv) Disbursement Procedures
14. The Grant proceeds for financing works under the EA-administered portion (equipment,
training and project management costs) will be disbursed in accordance with ADB’s Loan
Disbursement Handbook (2007, as amended from time to time),3 and detailed arrangements
agreed upon between the Government and ADB. On the other hand, all disbursements under
the ADB-administered portion (consulting services, equipment, training and project
management costs) will be carried out in accordance with the ADB Technical Assistance
Disbursement Handbook dated May 2010 (as amended from time to time).
(v) Imprest Account: Statement of Expenditures
15. Except as ADB may otherwise agree, the Recipient immediately after the Effective Date
shall cause (i) MEF and NAA to each establish an imprest account in Dollars at a commercial
bank acceptable to ADB, and (ii) MEF-DIC, each Rural Development Ministry, and CAR to
establish a sub-account of the MEF imprest account at a commercial bank acceptable to ADB to
receive amounts funded through the MEF imprest account. The initial aggregate amount to be
3
Available at: http://www.adb.org/Documents/Handbooks/Loan_Disbursement/loan-disbursement-final.pdf
16
deposited into the imprest accounts shall not exceed the lower of (i) the estimated expenditure
to be financed from the imprest account for the first 6 months of Project implementation, or (ii)
the equivalent of 5% of the Grant amount. For MEF, this translates to 5% of the aggregated
amounts under Components 1-3; and for NAA, this translates to 5% of the amount under
Component 4). The imprest accounts will be established, managed, replenished, and liquidated
in accordance with ADB's Loan Disbursement Handbook, and detailed arrangements as agreed
between the Recipient and ADB. The disbursements from the project imprest accounts will
comply with the Recipient's disbursement tracking requirements. The liquidation will be
monitored by DIC for Components 1 and 3. The currency of the imprest accounts shall be
Dollars. MEF-DIC, each Rural Development Ministry, and CAR will each operate a sub-account
of the MEF imprest account to receive funds to undertake their activities under the Project.
These sub-accounts will be established, managed, replenished and liquidated in accordance the
arrangements agreed upon between the Recipient and ADB as outlined in the PAM.
16. ADB's statement of expenditure procedures may be used for reimbursing eligible
expenditures and liquidating of advances to the imprest accounts. The maximum payment for
any individual items using these procedures is $10,000 equivalent per individual payment.
Table 3: Allocation and Withdrawal of Grant Proceeds

(Public Financial Management for Rural Development Project 2)
Proposed Allocation ($'000)

Category Name % of ADB Financing
Category Subcategory
1 Consultants 2,482
Component 1 1,257 100% of the total expenditure
Component 2 233 100% of the total expenditure
2 Equipment 322
Capacity
Development and
3 Training * 1,580
Project
4 Management 179
5 Contingency 437
TOTAL 5,000
* The budget includes training to all line ministries and government agencies on the updated SOP/PM/FMM.

17
C. Expenditure Accounts by Financier
Table 4: Detailed Cost Estimates by Financier4
($ million)
ADB
Total
Item Amount % of Cost Category Cost
A. Investment Costs a
1. Civil Works - -
b
2. Mechanical and Equipment 322.00 5.85 322.00
3. Environment and Social Mitigation - - -
3. Consultants 2,482.00 45.13 2,482.00
a. Project Management c 179.00 3.25 179.00
b. Capacity Development 1,580.00 28.73 1,580.00
Subtotal (A) 4,563.00 82.96 4,563.00
B. Recurrent Costs
1. Salaries - - -
2. Accommodation - - -
3. Equipment Operation and Maintenance - - -
Subtotal (B) 500.00 9.09 500.00
Total Base Cost 5,063.00 92.05 5,063.00
C. Contingenciesd
1. Physical 437.00 7.95 437.00
2. Price - - -
Subtotal (C) 437.00 7.95 437.00
Total Project Cost (A+B+C) 5,500.00 100.00 5,500.00
Note: (i) The amount and financier of taxes and duties (ADB) and (ii) Government contribution is in kind. This includes
office accommodation, counterpart staff salaries, meeting facilities and others.
a
In mid-2010 prices
b
servers; 2 desktops; 1 B/W printers; 2 laptops; 1 colored printer; 1 photocopier; and software; and Equipment under
component 4 includes: 14 computers, 1 B/W photocopier, and 1 colored photocopier.
c
Project Management under component 1 includes: Misc. admin and support costs (including Project coordinator on
a contractual basis) to be incurred by the EA and the Firm; Project Management under component 2 includes: report
and info materials; project administration cost (including Project coordinator on a contractual basis); Project
management under component 3 includes: project admin cost (including project coordinator on contractual basis);
and translation services and Project management under component 4 includes: report and info materials, project
admin costs, and translation services.
d
4
The amount to be financed will be within the reasonable threshold identified during the CPS preparation process;
the amount to be financed does not represent an excessive share of the project investment plan; the financing of
taxes and duties is material and relevant to the success of the project; and the taxes and duties to be financed
apply only with respect to ADB financed expenditures
18
D. Expenditure Accounts by Outputs/Components
Table 5: Detailed Cost Estimates by Outputs/Components

Component 1 Component 2 Component 3 Component 4
Item Total Amount % of Cost Amount % of Cost Amount % of Cost Amount % of Cost
Cost Category Category Category Category
a
A. Investment Costs
1. Civil Works - - - - -
2. Mechanical and 322.00 210.00 65.22 10.00 3.11 76.00 23.60 26.00 8.07
b
Equipment
3. Environment and Social - - - - - - - - -
Mitigation
3. Consultants 2,482.00 1,257.00 50.64 233.00 9.39 703.00 28.32 289.00 11.64
a. Project 64.00 35.75 40.00 22.35 40.00 22.35 35.00 19.55
c
Management 179.00
b. Capacity 44.30 500.00 31.65 250.00 15.82 130.00 8.23
Development 1,580.00 700.00
Subtotal (A) 4,563.00 2,231.00 48.89 783.00 17.16 1,069.00 23.43 480.00 10.52
B. Recurrent Costs
1. Salaries - - - - - - - - -
2. Accommodation - - - - - - - - -
3. Equipment Operation and - - - - - - - - -
Maintenance
Subtotal (B) 500.00 - - - - - - - -
Total Base Cost 5,063.00 2,231.00 44.06 783.00 15.47 1,069.00 21.11 480.00 9.48
d
C. Contingencies 437.00 204.00 46.68 78.00 17.85 107.00 24.49 48.00
10.98
Subtotal (C) 437.00 204.00 46.68 78.00 17.85 107.00 24.49 48.00
10.98
Total Project Cost (A+B+C) 5,500.00 2,435.00 44.27 861.00 15.65 1,176.00 21.38 528.00 9.60
a
In mid-2010 prices
b
Equipment under component 1 includes: 6 desktops; 3 servers; 3 B/W printers ; 8 laptops; 3 colored printers; 3 vehicles; 1 LCD projector; 3 photocopiers;
and software for MRD, MAFF, and MOWRAM; Equipment under component 2 includes: 2 computers, 1 photocopier, and 1 printer; Equipment under
component 3 includes: 2 servers; 2 desktops; 1 B/W printers; 2 laptops; 1 colored printer; 1 photocopier; and software; and Equipment under component 4
includes: 14 computers, 1 B/W photocopier, and 1 colored photocopier.
c
Project Management under component 1 includes: Misc. admin and support costs (including Project coordinator on a contractual basis) to be incurred by the
EA and the Firm; Project Management under component 2 includes: report and info materials; project administration cost (including Project coordinator on a
contractual basis); Project management under component 3 includes: project admin cost (including project coordinator on contractual basis); and
translation services and Project management under component 4 includes: report and info materials, project admin costs, and translation services.
d
Source}: ADB staff estimates.
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08/09/2010 3:45:00 PM
19
E. Expenditure Accounts by Year
Table 6: Detailed Cost Estimates by Year

($’000)
Item Total Cost Year 1 (2011) Year 2 (2012) Year 3 (2013)
a
A. Investment Costs
1. Civil Works - - - -
b
2. Mechanical and Equipment 322.00 102.00 120.00 100.00
3. Environment and Social Mitigation - - - -
3. Consultants 2,482.00 1,000.00 1,000.00 482.00
a. Project Management c 179.00 100.00 60.00 19.00
b. Capacity Development 1,580.00 500.00 600.00 480.00
Subtotal (A) 4,563.00 1,702.00 1,780.00 1,081.00

B. Recurrent Costs
1. Salaries - - - -
2. Accommodation - - - -
3. Equipment Operation and Maintenance - - - -
Subtotal (B) 500.00 200.00 200.00 100.00
Total Base Cost 5,063.00 1,902.00 1,980.00 1,181.00

d
C. Contingencies
1. Physical 437.00 165.00 150.00 122.00
2. Price - - - -
Subtotal (C) 437.00 165.00 150.00 122.00
Subtotal (D) - - - -
Total Project Cost (A+B+C) 5,500.00 2,067.00 2,130.00 1,303.00
% Total Project Cost 100.00 37.58 38.73 23.69

— = data not available.
Source: ADB staff estimates.
a
In mid-2010 prices
b
servers; 2 desktops; 1 B/W printers; 2 laptops; 1 colored printer; 1 photocopier; and software; and Equipment under
component 4 includes: 14 computers, 1 B/W photocopier, and 1 colored photocopier.
c
Project Management under component 1 includes: Misc. admin and support costs (including Project coordinator on
a contractual basis) to be incurred by the EA and the Firm; Project Management under component 2 includes: report
and info materials; project administration cost (including Project coordinator on a contractual basis); Project
management under component 3 includes: project admin cost (including project coordinator on contractual basis);
and translation services and Project management under component 4 includes: report and info materials, project
admin costs, and translation services.
d
20
F. Contract and Disbursement S-curve
Figure 3: Contract and Disbursement S-curve
Contract Awards
2000
1500 Year 1, 2,0M

Year 2,
($'000)
1,500,000
1000
Year 3,
1,400,000
500
0
Year 1 Year 2 Year 3
Year
Disbursements
1720
1700
1680 Year 2,
1660 1.7M
($'000)
1640
1620
1600
1580 Year 1 1.6m Year 3, 1.6m
1560
1540
Year 1 Year 2 Year 3
Year

21
G. Fund Flow Diagram
Figure 4: Funds Flow Arrangement

($’000)
Asian Development Bank
Grant Imprest Account
Consulting Services
under Components 1- 4:
Remuneration, Travel, Per
Diem ($2,482)
MEF NAA
Equipment under
Component 3:
DMFAS Software ($70) Managed by the Executing Agencies
Components 1, 2, and 3 Component 4

Located in MEF Located in NAA
Training under
Components 1, 3:
Workshops, Seminars, Equipment under Equipment:
Study Tours ($950) Components 1, 2 and 3: IT Systems ($26)
IT Systems, Software,
Vehicles ($252)
Project Management
Costs under Training under Training:
Components 1, 3: Component 3: Workshops, Seminars,
Office Accommodation Workshops, Seminars, Study Tours ($130)
and Facilities, Study Tours ($500)
Administrative Support
($14)
Project Management Project Management

Costs under Costs:
Components 1, 2 and 3: Office Accommodation
Office Accommodation and Facilities,
and Facilities, Administrative Support
Administrative Support ($35)
($130)
22
V. FINANCIAL MANAGEMENT
A. Financial Management Assessment
17. An assessment of the country’s public financial management systems was carried out to
better understand the fiduciary risks and determine appropriate arrangements for the fiduciary
arrangements of subprogram 2. Discussions were held with the Government during
implementation of subprogram 2 on the funds flow from NBC to MEF and the contribution of the
ongoing public financial management reform program5 to the administration of grant proceeds.6
Very satisfactory progress has been noted in revenue collections, with greater use of the
banking system to streamline revenue collection and payment processes. The redesign of an
integrated chart of accounts and budget classification has been substantially completed to
improve expenditure tracking and reporting. As part of efforts to improve governance, the
Government continues to place significant emphasis on strengthening the overall public
financial management system, internal systems (including internal audit functions), and the
functions of the National Audit Authority. The ongoing public financial management program,
which started in 2004 and is supported by a number of development partners including ADB,
has helped lower the fiduciary risk of the system.
18. Risks to PFM are perceived to be low to medium and include weak institutional and
human capacity, and lack of attention to coordination between the MEF and the line ministries.
Mitigation of these risks takes place through the PFMRP and also in the Government efforts to
improve public financial management, the overall trajectory of change is positive, though
progress in some key areas has been slow. Good progress has already been achieved in the
first two years of implementation (increased use of banking system for civil servants pay,
enhancement of accounting and reporting system, increased transparency, etc.) The National
Audit Authority is gradually being empowered to oversee and audit activities of all Government
ministries and agencies. Both MEF and NA have demonstrated capacity in implementing ADB
projects, and over the years, have received a number of trainings in ADB disbursement
procedures. No Second Generation Imprest Account is being proposed. In view of this, there
are no potential risks to financial management by the EAs.
B. Disbursement
19. The Grant proceeds for financing works under the EA-administered portion (equipment,
training and project management costs) will be disbursed in accordance with ADB’s Loan
Disbursement Handbook (2007, as amended from time to time),7 and detailed arrangements
agreed upon between the Government and ADB. On the other hand, all disbursements under
the ADB-administered portion (consulting services, equipment, training and project
management costs) will be carried out in accordance with the ADB Technical Assistance
Disbursement Handbook dated May 2010 (as amended from time to time).
20. Pursuant to ADB's Safeguard Policy Statement (2009) (SPS),8 ADB funds may not be
applied to the activities described on the ADB Prohibited Investment Activities List set forth at
5
ADB. 2008. Report and Recommendation of the President to the Board of Directors on a Proposed Program
Cluster, Grant for Subprogram 1, and Grant Assistance to the Kingdom of Cambodia for the Public Financial
Management for Rural Development Program. Manila (Grant 0132 and 0133-CAM).
6
Ministry of Economy and Finance. 2007. External Advisory Panel Report on the Public Financial Management
Reform Program. Phnom Penh.
7
Available at: http://www.adb.org/Documents/Handbooks/Loan_Disbursement/loan-disbursement-final.pdf
8
Available at: http://www.adb.org/Documents/Policies/Safeguards/Safeguard-Policy-Statement-June2009.pdf

23
Appendix 5 of the SPS. All financial institutions will ensure that their investments are in
compliance with applicable national laws and regulations and will apply the prohibited
investment activities list (Appendix 5) to subprojects financed by ADB.
21. The statement of expenditure (SOE) procedure may be used when seeking
reimbursement of eligible expenditures and liquidating advances made into the project imprest
accounts. The maximum payment for any individual item using these procedures is $10,000
equivalent per individual payment. SOE records should be maintained and made readily
available for review by ADB's disbursement and review mission or upon ADB's request for
submission of supporting documents on a sampling basis, and for independent audit.9
22. Before the submission of the first withdrawal application, MEF and NAA should submit to
ADB sufficient evidence of the authority of the person(s) who will sign the withdrawal
applications on behalf of the recipient, together with the authenticated specimen signatures of
each authorized person. The maximum value per withdrawal application is US$100,000, unless
otherwise approved by ADB. MEF and NAA are to consolidate claims to meet this limit for
reimbursement and imprest account claims. Withdrawal applications and supporting documents
will demonstrate, among other things that the goods, and/or services were produced in or from
ADB members, and are eligible for ADB financing.
C. Accounting and Reporting
23. The MEF and NAA, assisted by the Team Leader of each component, will maintain
separate project accounts and records by funding source for all expenditures incurred on the
Project. Project accounts will follow international accounting principles and practices
D. Auditing
24. The MEF and NAA will cause the detailed consolidated project accounts to be audited in
accordance with International Standards on Auditing by an auditor acceptable to ADB. The
audited accounts will be submitted in the English language to ADB within 6 months of the end of
the fiscal year by the executing agency. The annual audit report will include a separate audit
opinion on the use of the imprest accounts and the SOE procedures. The Government and
MEF and NAA have been made aware of ADB’s policy on delayed submission, and the
requirements for satisfactory and acceptable quality of the audited accounts. ADB reserves the
right to verify the project's financial accounts to confirm that the share of ADB’s financing is used
in accordance with ADB’s policies and procedures.
VI. PROCUREMENT AND CONSULTING SERVICES
A. Advance Contracting
25. All advance action, advance contracting will be undertaken in conformity with ADB’s
Procurement Guidelines (2010, as amended from time to time) and ADB’s Guidelines on the
Use of Consultants (2010, as amended from time to time). The issuance of RFP under advance
9
Checklist for SOE procedures and formats are available at:
http://www.adb.org/documents/handbooks/loan_disbursement/chap-09.pdf
http://www.adb.org/documents/handbooks/loan_disbursement/SOE-Contracts-100-Below.xls
http://www.adb.org/documents/handbooks/loan_disbursement/SOE-Contracts-Over-100.xls
http://www.adb.org/documents/handbooks/loan_disbursement/SOE-Operating-Costs.xls
http://www.adb.org/documents/handbooks/loan_disbursement/SOE-Free-Format.xls
24
action will be subject to ADB approval. The Borrower has been advised that approval of
advance action does not commit ADB to finance the Project.
B. Procurement of Goods, Works, and Consulting Services
25. All procurement of goods and works will be undertaken in accordance with ADB’s
Procurement Guidelines (2010, as amended from time to time). An 18-month procurement plan
indicating threshold and review procedures, goods and consulting service contract packages
and national competitive bidding guidelines is in Section C.
26. All consultants will be selected, engaged, and administered by ADB on behalf of the
Government according to ADB’s Guidelines on the Use of Consultants by Asian Development
Bank and its Borrowers (2010, as amended from time to time).10 The terms of reference for all
consulting services are detailed in Section D. For Component 1 Strengthening of public
financial management in rural development ministries (MAFF, MRD, and MOWRAM), an
estimated 106 person-months (42 international and 64 national); Component 2 Strengthening
public administration system in selected areas, an estimated 25 person-months (5 international
and 20 national); Component 3, Strengthening debt management, an estimated 35 person-
months (25 international and 10 national); and Component 4, Strengthening the effectiveness
of national audit authority, an estimated 20 person-months (10 international and 10 national) are
required. For Components 1 and 3, consultancy firms (national and international firms in
association or joint venture) shall be selected through quality- and cost based selection (QCBS)
method with 80:20, full technical proposal and simplified technical proposal, respectively. For
Components 2 and 4, international and national individuals shall be hired through ICS. All
equipment except for the DMFAS software will be procured by the two EAs.
C. Procurement Plan
Project Name: Public Financial Management for Rural Development Project 2

Country: Cambodia Executing Agency: Ministry of Economy and
Finance
Grant Amount: $5.0M Grant Number: 41373
Date of First Procurement Plan : 31 May Date of this Procurement Plan: 29 June
2010 2010
D. Process Thresholds, Review and 18-Month Procurement Plan
1. Project Procurement Thresholds
27. Except as the Asian Development Bank (ADB) may otherwise agree, the following
process thresholds shall apply to procurement of goods and works. However, the EAs have the
discretion to follow Cambodia’s Procurement Manual for Externally Financed Projects/Programs
in Cambodia, 2005, for auditing purposes as long as ADB’s requirements on procurement are
met.
Procurement of Goods and Works

Method Threshold
10
Checklists for actions required to contract consultants by method available in e-Handbook on Project
Implementation at: http://www.adb.org/documents/handbooks/project-implementation/

25
National Competitive Bidding for Goods Between $ 100,000 and below $ 250,000
Shopping for Works Below $100,000
Shopping for Goods Below $100,000
Direct Shopping Below 10,000
2. ADB Prior or Post Review
28. Except as ADB may otherwise agree, the following prior or post review requirements
apply to the various procurement and consultant recruitment methods used for the project.
Procurement Method Prior or Post Comments

Procurement of Goods and Works
NCB Goods Prior First set of bidding
documents in English
language, irrespective
of $ value including all
steps involved till
award of contract
Shopping for Goods Prior First set of bidding
steps involved till
award of contract
Direct Contracting Prior First set of bidding
steps involved till
award of contract
Recruitment of Consulting Firms

Quality- and Cost-Based Selection (QCBS) Prior
Recruitment of Individual Consultants

Individual Consultants Prior
30. The following table lists consulting services contracts for which procurement activity is
either ongoing or expected to commence within the next 18 months. Given the high priority
accorded to the project by the government, ADB will use advance contracting of consulting
services which will cover uploading of TORs in the ADB website up to final selection of
individual consultants/consulting firms prior.
Advertisement International or
General Contract Recruitment Date National
Description Value Method1 (quarter/year) Assignment Comments
1. Consultancy $1,257,000 QCBS (80:20), 3Q 2010 International/national 4 International (42

Services for (consists of FTP pm) and 6
Improved PFM consultancy National (64 pm)
Capacity in fees,
RDMs training,
26
Advertisement International or
General Contract Recruitment Date National
1
Description Value Method (quarter/year) Assignment Comments
(Component 1) project
management
cost)
2. Consultancy $ 233,000 ICS 3Q 2010 International/national 2 International (5
Services to the (consultancy pm) and 4
Council of fees) National (20 pm)
Administration
Reforms
(Component 2)
3. Consultancy $ 703,000 QCBS (80:20), 3Q 2010 International/national 3 International (25

Services (consists of STP pm) and 1
Strengthening consultancy National (10 pm)
Debt fees,
Management training,
within MEF-DIC project
(Component 3) management
cost and
DMFAS
software)
4. Consultancy $ 289,000 ICS 3Q 2010 International/national 1 International (10
Services for (consultancy pm ) and 1
advisory support fees) National (10 pm)
to NAA
(Component 4)
DMFAS = Debt Management and Financial Analysis System, FTP: Full Technical Proposal; ICS = Individual
Consultant Selection, QCBS = Quality and Cost based selection STP = Simplified Technical Proposal.
3. Goods Estimated to Cost Less than $1 Million
31. The following table groups smaller-value goods, for which procurement activity is either
ongoing or expected to commence within the next 18 months.
Procurement /
General Value of Contracts Recruitment
1
Description (cumulative) Number of Contracts Method Comments
1. Vehicle (3 units) $ 90,000 1 Shopping 2Q 2011
2. Computers, LCD, $ 126,000 Multiple (3 or above) NCB/Shopping 2Q 2011
Projectors, printers,
photocopiers,
software
3. Translation of $ 89,500 Multiple (6 or above) Shopping Throughout the
manuals, preparation project
of training materials, implementation
seminars,
conferences,
workshops,
organizing study
tours, etc
E. Indicative List of Packages Required Under the Project
32. The following table provides an indicative list of all procurement (goods and consulting
services) over 18 months of the project.

27
Estimated Estimated Domestic

General Value Number of Procurement Preference
Description (cumulative) Contracts Method Applicable Comments
1. Computers, $ 126,000 Multiple (3 or NCB/Shopping - 4Q 2011
LCD, above)
Projectors,
printers,
photocopiers
2. Translation $ 89,500 Multiple (6 or Shopping - Throughout the

of manuals, above) project
preparation of implementation
training
materials,
seminars,
conferences,
workshops,
organizing
study tours, etc
F. National Competitive Bidding
1. General
33. The procedures to be followed for national competitive bidding shall be those set forth
for the “National Competitive Bidding” method in the Government’s Procurement Manual of
September 2005 issued under Decree Number 14 ANKR.BK dated 26 February 2007 with the
clarifications and modifications described in the following paragraphs required for compliance
with the provisions of the Procurement Guidelines.
2. Application
34. Contract packages subject to National Competitive Bidding procedures will be those
identified as such in the project Procurement Plan. Any changes to the mode of procurement
from those provided in the Procurement Plan shall be made through updating of the
Procurement Plan, and only with prior approval of ADB.
3. Eligibility
35. Bidders shall not be declared ineligible or prohibited from bidding on the basis of barring
procedures or sanction lists, except individuals and firms sanctioned by ADB, without prior
approval of ADB.
4. Advertising
36. Bidding of NCB contracts estimated at $500,000 or more for goods and related services
or $1,000,000 or more for civil works shall be advertised on ADB’s website via the posting of the
Procurement Plan.
5. Anti-Corruption
28
37. Definitions of corrupt, fraudulent, collusive and coercive practices shall reflect the latest
ADB Board-approved Anti-Corruption Policy definitions of these terms and related additional
provisions
6. Rejection of all Bids and Rebidding
38. Bids shall not be rejected and new bids solicited without ADB’s prior concurrence.
7. Bidding Documents
39. The bidding documents provided with the government’s Procurement Manual shall be
used to the extent possible. The first draft English language version of the procurement
documents shall be submitted for ADB review and approval, regardless of the estimated
contract amount, in accordance with agreed review procedures (post and prior review). The
ADB-approved procurement documents will then be used as a model for all procurement
financed by ADB for the project, and need not be subjected to further review unless specified in
the procurement plan.
8. Member Country Restrictions
40. Bidders must be nationals of member countries of ADB, and offered goods, works and
services must be produced in and supplied from member countries of ADB.
G. Consultant's Terms of Reference
1. General
41. At the request and as approved by the Government, the consultants, including the team
leader, will be selected, engaged and administered by ADB on behalf of the Government. For
Component 1, a consulting firm (including joint proposal with domestic firm) will be recruited
through a full technical proposal using quality and cost ratio for QCBS selection process (80:20).
Component 2 will have two international consultants and four national consultants. For
Component 3, a consulting firm (including joint proposal with domestic firm) will be recruited
through a simplified technical proposal using quality and cost ration for QCBS selection process
(80:20). These components relate to strengthening PFM for rural development. Consultants for
Components 2 and 4 will be selected on an individual basis. Component 4 will have one
international consultant and one national consultant for Component 4. The consultants will be
selected by ADB in accordance with the Guidelines on the Use of Consultants by Asian
Development Bank and Its Borrowers (2010 as amended from time to time) and other
arrangements satisfactory to ADB.
2. TOR for Project Component 1: Strengthening Public Financial Management

in Rural Development Ministries – MAFF, MRD, and MOWRAM
42. The project component 1 will be anchored within the Public Financial Management
Reform Program (PFMRP). As background materials, all specialists/consultants are required to
undertake a review of the PFMRP documents, Consolidated Action Plan and Ministerial Action
Plans of MAFF, MRD and MOWRAM, the 2007 and 2008 and 2010 PFM annual retreat
documentations, the 2007 and 2010 External Advisory Panel report, PEFA assessment of 2010
and PFMRP progress reports. The review will include an examination of (i) the Inception Report
and Progress Report prepared under Grant Assistance 0133 – Cambodia – Strengthening PFM

29
in rural development ministries within the PFMRP framework; (ii) Recommendations of the ADB
TA –CAM-4988 – Strengthening Public Financial Management in Rural Development Projects;
and (iii) Action Plan resulting from the MOU – 2007 and 2009 Joint World Bank/ADB Country
Portfolio Memorandum of Understanding (MOU) for effective implementation of Standard
Operating Procedures (SOPs) and supporting Manuals for ADB/WB/Bilateral Development
Partners (DPs) financed projects (Procurement Manual and Financial Management Manual).
Besides, formal training and workshops, the emphasis should be on the job training, knowledge
transfer by specialist/consultants/advisers through working together, meetings, and
workshops/seminars within relevant departments/ministries. Mentor support will be an
important tool.
a. International Consultants (4) for 42 person months on an

intermittent basis
i. Public Sector Budget and PFM specialist and Team Leader

(Intermittent, 12 person-months)
43. The Public Sector Budget Specialist and team leader will possess an advanced
university degree (Masters or equivalent) preferably in Economics, Public Sector Finance, or a
relevant combination of academic qualifications and have a minimum of 15 years experience in
budget system reforms including budget law, budget planning and formulation, program and
policy based budgeting, MTEF and Inter-budgetary fiscal relationship, especially in developing
countries and transitional economies in the region. The specialist should be sensitive to the
cultural and political economy context of Cambodia. The specialist will act as the team leader
for the team of consultants engaged under Component 1, and will assume responsibilities for
overall coordination with the PMF Working Groups in Rural Development Ministries (MAFF,
MRD and MOWRAM) and project management units (PMUs)., the PFM Reform Secretariat, the
Department of Investment and Cooperation, and the Economics and Finance Institute in MEF.
As a team leader, the specialist will possess effective interpersonal and communication skills
and will be responsible for all activities under the project, including coordinating the output of the
other international and domestic experts and ensure timely delivery of all outputs in coordination
with the Cambodian counterparts. Specific tasks will include the following:
(i) Formulate a training and capacity development plan for the implementation of
PFMRP stage 2, considering the Ministerial Action Plans, Consolidated Action
Plan – Stage 2 and the revised catalyst activities, in coordination with the PFM
Reform Working Groups of the rural development ministries. In preparing the
plan, the team leader will be guided by the recommendations of ADB TA 4988
CAM (October 2008), and the recommendations of the Project – 0133.
(ii) Prepare training background materials, update manuals, and guidance note, and
prepare new manuals and guidance where needed.
(iii) Strengthen capacity of MAFF, MRD and MOWRAM - central ministries and
selected provincial departments - for budget formulation – program budgeting,
MTEF assist in preparation of Budget Strategic Plan (BSP) in accordance with
MEF circulars, best practices and prepare guidelines and consult training and
provide regular mentor support.
(iv) Include estimated donor funded project and program expenditures in the annual
Strategic Budget Plan and other budget preparation documents.
(v) Support the implementation of PFSL – II and address the absence of reporting of
auxiliary ad autonomous budgets and preparation of a budget annex for the three
RDMs.
30
(vi) Coordinate support with both budget and planning department to strengthen
program-based budgeting process, and ensure there is proper coordination by
the PFM Working Group of the preparation of the program budget (Department of
Planning and Public Relations) and the non program budget (operational costs)
(Department of Supply and Finance).
(vii) Assist in improving the quality of information on externally funded capital
expenditure projects executed directly by development partners and integrate
them into BSP and budget reporting system.
(viii) Suggest mechanism for provincial budgets being subject to approval of (or at
least consultation with) central finance and planning departments.
(ix) Support the 3 RDMs to define and identify budget entities and budget entity
managers including freedoms and flexibilities to be given to budget entities, and
also support implementation.
(x) Support institutional capacity building in the Finance, Planning department,
PMUs and members of the PFM working groups;
(xi) Support PMU staff in capacity building in compliance with Standard Operating
Procedures (SOPs), and Finance Management Manual (FMM), mandated by the
sub-Decree of February 2007 for effective project implementation in coordination
with MEF (DIC).
(xii) Coordinate and assist the FM and Accounting specialist, Internal Audit and
Monitoring and evaluation specialist.
(xiii) Coordinate and formulate a master training plan encompassing foundational
training with EFI for central and selected provincial departments, and also
selected other government ministries, organizing Workshops on Ministry specific
issues (around TA 4988 and project 0133 recommendations and include the
Ministry specific requests, and on the job training and mentoring for all
Component 1 activities. Set training and workshop eligibility rules and
cost/reimbursement guidelines.
(xiv) Implement the master training plan; and for the training coordinated with training,
the coverage of training should be government wide to the extent resource and
facilities permit.
(xv) Support the framework of D&D Fiscal Decentralization in MAFF, MRD and
MOWRAM and sensitize the ministries downward to the sub-national authorities
on their evolving functions, responsibilities and prepare advisory notes on
implications of fiscal decentralization, de-concentration of functions and de-
centralized service delivery, and coordinate with ADB TA supporting functional
assignments and fiscal decentralization that include the 3 RDMs.
(xvi) Help 3 RDMs strengthen gender-sensitiveness in monitoring, planning and
budgeting systems, including gender-responsive budgeting, in coordination with
the ongoing initiative under ADB's TA-6493-REG: Gender Responsive
Decentralized Governance in Asia11 and support the PFM Working Groups to
develop measures for improving gender awareness in close coordination with
Gender Mainstreaming Action Groups of these Ministries. Support the PFM
Coordination Working Group for Rural Development Ministries, and work closely
with MEF in organizing these meetings, preparing background notes,
commissioning relevant studies, and providing inputs to the deliberations.
11
RETA 6493 covers Cambodia and supports a pilot gender-responsive budgeting with the Ministry of Education,
Youth, and Culture at the district (and to some extent influencing commune) level but it also includes a
comprehensive review of all the gender-responsive budgeting initiatives and other gender and decentralized
governance programs in Cambodia, which will be completed by November 2011.

31
(xvii) Prepare inception, midterm, final, and quarterly progress reports.

(xviii) Outsource/develop and implement training program/package in coordination with
DIC for SOP/FM/PMM and GGF for all line ministries and government agencies.
(xix) Support English language training for improved communications for selected key
officials.
(xx) Perform any other tasks required in implementing the project, including assisting
ADB missions, to help achieve the objectives and goals of the PFMRD within the
approved budget.
(xxi) Procure IT equipment under the component.
ii. Financial Management and Accounting Specialist

(intermittent, 10 person months)
44. The FM and Accounting Specialist should possess advanced qualification in public
sector accounting, with a minimum 15 years of experience of public sector accounting, budget
system, financial management, including Financial Management Information System (FMIS).
The specialist should be sensitive to the cultural and political economy context of Cambodia and
should have direct experience of PFM and accounting reform in developing countries, with
significant experience of public sector accounting principles and standards, integrated financial
management information systems (FMIS) business processes, FMIS application and systems
training and FMIS transition management. The specialist should have demonstrated
experiences of capacity building and training for accountants and possess strong inter-
personnel skills and experience of change management. The specialist will (i) undertake a
critical review of the PFMRP CAP II/ Stage 2 and revised catalyst for implementation of the
Stage 2 of PFMRP in the area of Financial Management and accounting, (ii) review MAPs and
identify actions for MRD, MAFF and MOWRAM; and (iii) formulate a training program and
provide training, both theoretical and on-the-job, including continuous mentor support. In
preparing the plan, the team leader will be guided by the recommendations of ADB TA 4988
CAM (October 2008), and the recommendations of the Project – 0133. Specific tasks will
include the following:
iii. Accounting and Financial Management
(i) Support the 3 RDMs to further improve the implementation of new budget
classification and new chart of accounts and identify issues of relevance for
Stage 2 implementation and provide training and mentor support to relevant staff
in MAFF, MRD and MOWRAM.
(ii) Assist in implementation of administrative and economic classifications using
GFS standards, including functional and program classifications (pilot) in budget
formulation and execution at MAFF, MRD and MOWRAM, prepare guidelines
and provide mentor support.
(iii) Prepare guidance notes/briefs based on the quality, timeliness and transparency
of existing accounting financial reporting by MAFF, MRD and MOWRAM
consistent with government wide accounting standards.
(iv) Assist in preparation of financial statements and define reporting formats for the
existing and new accounting systems to aid efficient accounting information.
(v) Assist in preparing reports on off-budget expenditures and revenue to MEF, and
in adhering to procedures for consolidating rural development ministries bank
accounts and strengthening Treasury Single Account (TSA) and undertaking
regular reconciliation with National treasury.
32
(vi) Assist in budget execution and transaction process through training in

expenditure commitment control and planning and establishing a mechanism for
commitment plan and for increased use of banking system for government
revenue and expenditure transaction processing.
(vii) Assist in preparing improved and transparent financial accounting report
consistent with MEF requirements on a quarterly, half yearly and end year basis
for MEF, MAFF, MRD and MOWRAM senior management.
(viii) Support ministry-specific improvement in accounting, financial reporting and
transparency. Indicative activities are as follows:
MRD:
¾ Investigate the possible introduction of an accounting package in
MRD prior to the introduction of FMIS.
¾ Engage with MEF to institute a system for MRD provincial line
departments to send reports to MRD central ministry, initially
quarterly, progressing to monthly.
¾ Include donor project expenditure in in-year reports on budget
execution.
MAFF:
¾ Train more users in the Conical Hat system as a back-up.
¾ Support efforts to design a system for MAFF provincial line
departments to send reports to MAFF central ministry, initially
quarterly, progressing to monthly.
¾ All projects being implemented by PCU/PIU/PSU arrangements to
report their expenditures to Department of Accounting and
Finance on a monthly basis.
¾ Design system for financial accounting administration
MOWRAM:
¾ Assist MOWRAM’s accounting and reporting functions to ensure
that the provincial departments and the project units submit
monthly expenditure reports to the Department of Finance. The
Department of Finance should undertake active monitoring of the
monthly expenditure patterns.
¾ Support capacity to undertake on an annual basis the Department
of Finance should initiate a mid-year review of budget execution
involving senior management (Secretaries of State and heads of
departments).
¾ Also support MOWRAM to introduce a commercial accounting
package prior to the introduction of the FMIS post-2011.
Asset Management
(ix) Undertake a general review of all policies relating to asset management,

e.g. recording, maintenance, replacement etc, with a view to improving the
efficiency of state asset property management.
Financial Management Information System (FMIS)
(x) Continue to strengthen level of understanding, ownership, engagement and

capacity for FMIS at MAFF, MRD and MOWRAM.

33
(xi) Continue to support establishment of FMIS project/Transition Management

Capacity at MAFF and MRD from Conical to FMIS based system (MAFF only)
roll-out.
(xii) Continue to support capacity building in understanding the FMIS policy paper and
the roll-out strategy and the changed business processes.
(xiii) Support training, seminars and other capacity building programs that will be
organized by the MEF on FMIS.
(xiv) Further provide recommendations and support implementation on proposed
organizational restructuring and staffing in MAFF (initially), MRD and MOWRAM
(on pilot basis), arising from changing roles and responsibilities.
(xv) Support MRD and MAFF and MOWRAM to prepare them for the next stage of
FMIS development in implementing analytical, business process and information
supply structures For MOWRAM, identify measures necessary to be included as
pilot for FMIS implementation.
(xvi) Support MRD, and MAFF to define the form of their own detailed implementation
of Stage 1 issues in detail with the support of FMIS Team and other departments
within MEF.
(xvii) Provide briefing to the internal audit sections given on how FMIS will impact on
their role and operation.
Training and Capacity Development
(xviii) Support the Economic and Finance Institute (EFI) training and capacity
development programs on a selected basis for accounting and financial
management issues and the Department of IT, MEF on FMIS training.
(xix) Perform any other tasks required in implementing the project, including assisting
approved budget.
Reports
(xx) Prepare reports on the activities undertaken to be included in the inception,

midterm, final, and quarterly progress reports.
iii. Internal Audit Specialist (Intermittent, 10 person-months)
45. The principal internal audit adviser will be required to have an advanced university
degree in accounting, audit, business administration, commerce or related field; or professional
accounting, auditing or related designation (CA, CPA, CIA, CISA, CFE) and will have a
minimum of 15 years experience of working in the area of audit. The adviser will have strong
knowledge of general auditing standards and practices; internal audit tools and techniques, and
will have extensive working experience in designing and implementing capacity development
and internal audit training programs. The specialist should be sensitive to the cultural and
political economy context of Cambodia. The specialist must have demonstrated competence in
INTOSAI Auditing Standards and International Standards for the Professional Practice of
Internal Auditing issued by the Institute of Internal Auditors (IIA). The specialist will show (i) a
good understanding of the history and development of PFM reforms and progress in budget
preparation reforms in developing countries; and (ii) have demonstrated abilities in capacity
development and change management in developing countries. The adviser will build on
recommendations of ADB Grant 0133–CAM: Strengthening PFM in Rural Development
Ministries and TA 4988-CAM: Preparing the Strengthening of Public Financial Management for
34
Rural Development Project in undertaking various responsibilities. The specialist will undertake
their activities within the scope of the Internal Audit sub decree, internal control policy
statement, internal auditing standards and code of conduct for internal audit staff issued by the
Government and internal good practices and will be guided by the PMFRP – Stage 2 –
Consolidated Action Plan / Departmental Action Plan/ Ministerial Action Plan through
coordination with the Director, Internal Audit Department, MEF.
46. To strengthen internal audit capacity in MAFF, MRD, and MOWRAM, the specialist
will undertake the following tasks:
(i) The specialist will seek to support the three RDMs to achieve the stage 2 of
PFMRP objective for encouraging responsible financial management and
enforcing accountability.
(ii) Strengthen Internal Control Procedure Framework to be applied for expenditure
and revenue in three RDMs.
(iii) Will incorporate appropriate sanctions/incentives for observance into the
Framework of Internal Control Procedure and provide training
(iv) Support implementation of annual audit plans and reports including preparing
explanatory notes and guidance on key technical issues, adopting a risk
assessment methodology
(v) Formulate a master training plan for classroom training, specific ministry
workshops, and provide on the job training, including mentoring on the basis of
risk-based annual audit plans for 2011. Training should include risk assessment
methodology, internal audit techniques, internal audit standards, internal control
standards and code of ethics for complying with government procedures and
standard operating procedures for donor projects, programs
(vi) Support pilot and actual auditing and support response to/use of audit findings.
(vii) Deepen Internal Audit Planning, and Internal Audit Methodologies including use
of ICT and Reporting, and Internal Audit Capacity Review, update and implement
ministry specific internal audit procedures/manuals and guidance notes for
internal audit and internal control, especially in the area of budget execution,
procurement both under national budget and donor assisted projects, and
payment procedures and train staff in its use.
(viii) Update internal audit methodology and procedures manuals.
(ix) Assist audit teams in conducting field audits and writing audit reports in a format
consistent with MEF standard.
(x) Strengthen procedures for effective follow up of internal audit reports and for
review by management.
(xi) Hold workshops for internal audit staff on their role and functions; governance,
accounting, and auditing issues; and codes of behavior and ethical conduct and
(xii) Implement procedures for communicating with NAA, MEF and other relevant
agencies; and strengthen the institutional interface between IADs of the three
RDMs and NAA.
(xiii) Assist in filed audit of selected ADB and donor funded projects.
(xiv) Support the PFM Coordination Working Group for Rural Development Ministries,
and work closely with MEF in organizing these meetings, preparing background
notes, commissioning relevant studies, and providing inputs to the deliberations.
(xv) Provide inputs to inception, midterm, final, and quarterly progress reports
(xvi) Perform any other tasks required in implementing the project, including assisting
approved budget.

35
iv. Monitoring and Evaluation Expert (10 person-months)
47. Robust public sector management (PSM) enables governments to make informed
decisions to sustain development outcomes. A strong results based M&E system is integral to
enable Cambodia to understand how efforts in the rural development sector contribute to the
objectives in sector strategies such as Strategy for Agriculture and Water (SAW) and National
objective of NSDP and the Rectangular Strategy yet public expenditure reviews persistently
highlight weak M&E system in developing member countries (DMCs) that constrain information
on and assessment of development initiatives. In addition, M&E systems that are put in place
suffer from inadequate attention to (a) interdependency of PFM functions of planning,
budgeting, implementation, monitoring, and evaluation; (b) integration of all functions around
common results; and (c) coordination across all government institutions around common results.
A Managing for Development Results (MfDR) approach to M&E will introduce features that,
when applied to PSM will enable DMCs to make informed decisions on future actions. Hence,
there is a need to develop an M&E framework within the context of public that covers all the
RDM and the MEF and Ministry of Planning (MOP). This will include developing country
standards for M&E based on good international practices, a gap analysis of the M&E
deficiencies in the RDS and a development plan for M&E that incorporates a managing for
development results (MfDR) approach. M&E is urgently needed in this stage (stage 2) to
monitor and evaluate implementation of programs both under donor and Government Budget. It
is very significant for implementation of the Rectangular Strategy 2 through NSDP Update 2009-
2013 of MoP.
48. The international expert must have extensive working experience in the areas of national
planning and fiscal budgeting, and have had prior experience in establishing National M&E
Frameworks (incorporating institutional, systems and human capacity development issues for
monitoring and evaluating national plans and fiscal budget results. Strong background in
economics, finance, commerce or national statistics will be required. In addition, there should
be a good appreciation of the latest trends in how to incorporate results based approaches
including the international dialogue on Managing for Development Results (MfDR) as declared
in the 2008 Accra Agenda for Action Prior work experience in the region and familiarity with
international standards and best practices will be an advantage.
49. The primary purpose of this assignment is to develop a Monitoring Framework for the
Rural Development Sector through the establishment of a network or community of practice
(CoP) of relevant staff in the three RDM and the MEF and Ministry of Planning to formulate
demand driven initiatives for the M&E framework. The expected key outputs are: (i) the
establishment of the CoP that will meet on a regular basis through seminars and workshops to
discuss the following specific activities; linkages of indicators for the M&E system with the
indicators in national planning such as the NSDP and SAW, (ii) institutional mandates and
linkages on M&E between the rural development ministries (RDMs) including the role of a
central coordinating ministry for M&E information, the role of the sector RDM: data collection,
recording, collating, and storing systems; and M&E reporting methodologies and systems. (iii)
undertaking a training and needs assessment working with the CoP so that staff of the three
RDMs sufficiently trained in implementing the monitoring & reporting system, the framework for
evaluation, and in sharing results to support the national planning and fiscal budget processes;
(iv) organizing workshops to raise awareness and provide training on the monitoring and
evaluation system to be implemented. This will include informing other development partners –
though the CoP will take the lead in the workshops, (a) coordinating the implementation of
software that is best suited for monitoring and evaluation (b) undertaking pilots to test the M&E
system working together with the CoP that is established, to track areas for improvement, The
36
reporting outputs will be an inception, progress and final reports of the consultancy. (v) The final
outputs of the M&E are expected: (i): A documented Monitoring Framework for the RDS agreed
by the M&E CoP network (of the MEF and the RDMs), that incorporates international best
practice in four broad areas of M&E; links to National Planning through an agreed set of
Indicators and targets ; institutional framework for M&E in the RDS that delineates mandates
and responsibilities for M&E between MEF and Ministry of Planning as central ministries, and
the sector RDM; data Systems for M&E that includes data collection, recording, storing and
transfer from sector to central ministries, and from the provincial to the central level of
government; and M&E Reporting Systems turning data to information for evaluation and
decision making. This will be supported by a (ii) M&E manual for RDMs to use, (iii)-Project
Database Management System for M&E purpose, (iv) Strengthening M&E technical capacity for
RD Ms' staff through series of TOT and further training courses to other M&E staff in central as
well as provincial level 4 M&E office, DPS of MAFF as well as others Ministries will need
equipment to work in efficiency and effectiveness.
vi. Detailed Tasks
50. The international expert will undertake the following tasks:
(i) Based on the results of tasks outlined in paragraphs 46–48 above, provide
training and on-the-job guidance to help staff of three RDMS develop the M&E
framework and implement the monitoring and evaluation system, to assess the
effectiveness of the NSDP, externally assisted development projects, and the
annual fiscal budget;
(ii) Provide inception, interim, and final reports as required to EA and IAs and ADB.
a. National Consultants (6) for 64 person months - intermittent
i. Specialist in Budget, Procurement, Accounting, IT

applications, Internal Audit and M&E - 64 person months in
all - intermittent)
51. The budget specialist (12 person months) will assist the Team Leader and should have
some background in finance, especially public sector financial management issues. S/he should
have a university degree either in Economics or Public Finance. S/he should be proficient in
English. S/he should be familiar with the government structure, and the particular functions of
the Ministry of Economy and Finance. S/he will assist the Team leader in providing guidance
and training in the areas of budget formulation, in preparation of the Budget Strategic Plan and
budget related issues in accordance with the Consolidated Action Plan under PFMRP stage 2
and Ministerial Action Plan of the rural development ministries.
52. The procurement specialist (10 person months) will work under the supervision of
Team Leader will have at least 5 years experience in relevant field, including experience in
project management and procurement. The specialist will possess sound knowledge of
planning, preparation, and implementation of procurement standards and procedures based on
government and ADB guidelines. The specialist will have good general knowledge of Cambodia
government structure and budgetary procedures and should possess sound skill in IT
application. The specialist will review procurement guidelines and support training and assist in
dissemination of the guidelines to all PMUs and PIUs and procurement entities. S/he will assist
the procurement committees in MAFF, MRD and MOWRAM and support measures for

37
compliance with internal control process for each type of procurement. The specialist will assist
in development and preparation of procurement documents and assist in preparation of
procurement reports.
53. The Accounting Specialist (10 person months) will have working experience in
implementing accounting training programs in Cambodia and will demonstrate a good
understanding of the history and development of PFM reforms (as well as progress in budget
preparation reforms) of the Cambodia and will assist the international Financial Management
and Accounting Specialist in implementing a series of training modules on (a) the revised chart
of accounts and budget classification system; (b) the continued education about the accounting
fundamentals and (c) assist the Government in preparing the first set of consolidated financial
statements (on a pilot basis), prior to completion of the project.
54. The IT Specialist (10 person months) will have a background in information technology
(IT), and the required experience and qualifications in database management systems. The
specialist will have (i) some demonstrated experience in managing financial management and
accounting software systems and have a good working knowledge of English, and (ii)
demonstrated aptitude for computer software and database management systems. The
specialist will report to the FM and Accounting Specialist. Working experience with international
consultants and/or the government is an advantage. Tasks will include assisting the
international FM and Accounting specialist in IT aspects of implementing the FMIS and
supporting the design of capacity-building modules and conduct IT training programs in
coordination with Department of IT, MEF and the rural development ministries. The specialist
will organize IT workshops and assist the international consultants and ADB missions in
preparing relevant materials.
55. The Internal audit expert (10 person months) will have a background in accounting
and/or auditing and a good working knowledge of English. Working experience with international
consultants and/or the government is an advantage. The expert will report to the international
audit specialist, and assist the Team Leader and the international specialists in all aspects of
their task within the terms of reference: (i) assist the international consultants with training for
the Internal Audit Department, MEF, MRD, MAFF and MOWRAM; (ii) participate in the design
and implementation of capacity-building modules as assigned by the international audit
specialist; (iii) prepare progress reports for inclusion in the team progress reports; and (iv) assist
the international consultants and ADB missions prepare relevant materials.
56. The M&E expert (12 person months) will have a working background in the formulation
and implementation of M&E systems (particular IT based understanding) and a good working
knowledge of English. Working experience with international consultants and/or the
government is an advantage. The expert will assist the international expert and the team leader
on various aspects of the project including (i) the understanding on Cambodia's existing M&E
systems and processes, and the comprehensive documentation of the existing system
architecture in Khmer and English for the benefit of the government and the project; (ii) assisting
in the documentation of the M&E Framework as it develops including charts, tables and
preparing presentations; (iii) providing workshop and other reports as required; and (iv) assisting
the international consultants and ADB missions prepare relevant materials.
57. In addition, all the specialists will (i) assist the Team Leader and the international
specialists in all aspects of their task within the terms of reference; (ii) under the guidance of the
team leader, collect and analyze information, and make it available in English in an organized,
readable form; (iii) help the international team make available to the Government all reports and
38
TA project outputs; (iv) conduct research on specific topics as required by the team leader and
the international specialists; (v) arrange and organize discussions and workshops, and help the
team leader and the international specialists prepare materials for them, including translations of
documents (if necessary) and interpretation of the discussions; (vi) act as an interpreter in
meetings and training sessions, help translate documents (if needed) and coordinate translation
works to be contracted to others; (vii) prepare copies of training materials, reserve the venue for
training, and liaise with training participants and other resource persons; and (viii) perform other
task that may be assigned by the international team leader.
2. TORs FOR COMPONENT 2: STRENGTHENING PUBLIC ADMINISTRATION

SYSTEM IN SELECTED AREAS
58. This component will support the Council of Administration Reforms (CAR) in two areas
to train the managers (train-the-trainers) and to develop a core group of experts; and (iii) to
undertake an operational needs assessment to inform on a longer term strategy to develop
capacity. Technical assistance is urgently required to support the development of the program
and prepare for implementation. The program to train managers is the most urgent of these
projects as the Prime Minister has asked the CAR to organize and implement a program to train
all managers of the Civil Service in core competencies. The program would make use of course
modules that were developed in the context of the EPSCB program. It would be managed
according to best practices concerning planning, implementation, coordination and monitoring.
Given the size of the undertaking, the program may be broken down in phases starting first with
the most senior managers and then following up with middle managers. CAR will organize and
implement a program to train all managers of the Civil Service in core competencies. The
program would target managers at the national and sub-national levels grouped into three
levels: level 1: bureau chiefs; level 2: directors and deputy directors; and level 3: secretaries and
directors general and their deputies. The program would cover four types of core competencies
for each of these levels: Personal (Integrity, Ethics and values and Results orientation; (ii)
People (Influencing and advocacy, Partnering and networking, and Conflict resolution; (iii)
Management and Organizational (Strategic and operational planning; Organizational
awareness; Budget and financial management; Communication and information; Policy
development and delivery; and Leading and managing change and Leadership (Problem
solving and decision making, Negotiations for results, Holding people accountable, and Leading
and developing others). The program would make use of course modules that were developed
in the context of the EPSCB program. Given the size of the undertaking, the program may be
broken down in phases starting first with the most senior managers and then following up with
middle managers. Secondly, the component will support a mission to carry out an operational
need assessment. This is the second most urgent of the envisaged programs of assistance.
a. International Consultants (2) for 5 person months12
59. Working under the general direction of the Secretary General and in close collaboration
with CAR staff, the international HRD Training expert (3 months) would:
• Analyze relevant documentation including recent training programs such as the

Economic and Public Sector Capacity Building Project (EPSCB) of the World
Bank and the Institutional Support Program (ISP) of the European Commission;
• Assist the design of a training program including training modules addressing the
development of core management competencies;
12
The TOR will be further refined by CAR.

39
• Assist a consultation process involving stakeholders;

• Assist in the finalization of the training program and training modules;
• Assist in the design of an implementation plan and related budgets;
• Assist in the design and establishment of requisite management and monitoring
mechanisms;
• Assist in the design and establishment of a communications strategy;
• Facilitate the transfer of knowledge to counterparts.
60. Outputs would include:
1. An inception report detailing the proposed work plan no later than one week after
commencement of assignment;
2. An initial outline of the training program based on guidance from CAR and
relevant documentation;
3. An initial draft of training modules addressing core competencies targeting each
level of management;
4. A final draft of the training program incorporating feedback from ministries and
development partners;
5. A draft of the implementation strategy including proposed management and
monitoring mechanisms;
6. A draft communication and dissemination plan; and
7. Communication and dissemination workshops.
61. Second HRD Training Expert: Working under the general direction of the Secretary
General and in close collaboration with CAR staff, an international HRD consultant (2 months)
would facilitate:
• An analysis of relevant documentation including recent studies undertaken by

ministries concerning their priority capacity development needs;
• the design of a methodology to conduct a survey of capacity development needs;
• the conduct of the survey and the finalization of the survey report;
• the drafting of a paper identifying strategic and priority options;
• the consultation process to bring out a consensus;
• the design of an implementation plan and related budgets;
• the design and establishment of requisite management and monitoring
mechanisms;
• the design and establishment of a communications strategy; and,
• the transfer of knowledge to counterparts.
62 Outputs would include:
• An inception report detailing the proposed work plan no later than one week after
commencement of assignment;
• A document outlining the methodology to undertake a survey of capacity
development needs;
• A draft report on survey findings;
• An initial draft of a paper outlining strategic and priority options to support
consultations;
40
• A draft operational plan to implement the consensus;

• A document describing management and monitoring mechanisms; and,
• A draft communication and dissemination plan.
b. National Consultants (4): Support the international consultants – 12

person-months for two national consultants and 8 person-months
for 2 national consultants – Total 20 person months
3. TORs FOR PROJECT COMPONENT 3: Strengthening Debt Management
a. International Consultants (3) for 25 person months on an

intermittent basis
63. The project component 3 will be focused on capacity building of Public Debt
Management (PDM) in the Ministry of Economic and Finance's Department of Investment and
Corporation (MEF-DIC). As background materials, all specialists/consultants must have
experiences in performing Debt Sustainability Analysis (DSA), setting up debt strategy and
conducting risk management/analysis on debt (e.g., credit risk analysis, currency risk analysis,
and interest rate risk analysis) in a low income country. The specialists must also have
experiences in transferring their knowledge in a form of formal training and workshops. In
addition to the formal training, the emphasis should be on the job training, knowledge transfer
by specialist/consultants/advisers through working together, meetings, and workshops/seminars
within relevant departments / ministries. Mentor support will be an important tool.
i. Public Debt Management Specialist and Team Leader

(Intermittent, 12 person-months)
64. The Public Debt Management (PDM) Specialist and Team Leader will be a debt
specialist with macroeconomic background (preferably in fiscal issues) with high-level academic
qualifications and significant experience in managing public debt in low income economies,
preferably those comparable to Cambodia. The specialist will act as the team leader for the
team of consultants engaged under Component 3, and will assume responsibilities for overall
coordination with the Department of Investment and Cooperation, the Implementing Agency for
this component. The specialist will have had experience in assessing the fiscal and balance of
payments implications of an increased external borrowing in a resource constraint country,
linking increase in foreign financing to national development planning, and setting up a Debt
Management Office in Ministry of Finance. The consultant will assist MEF with formulation of
the public debt management strategy with objectives of improving realism and sustainability of
the budget, strengthening debt management functions (forecasting, financing analysis and
payment management) covering both external and domestic debt, and linking them to budget
formulation and execution, as designated under Stage 2/Platform 2 Consolidated Action Plan
(CAP) and Departmental Action Plan (MEF) under the Public Financial Management (PFM)
Reform Program of the Royal Government of Cambodia. The specialist should be sensitive to
the cultural and political economy context of Cambodia. The focus of the consultant’s work will
be to (i) provide detailed strategic recommendations, technical advice, and on-the-job training
to MEF departments/units concerned to strengthen integrated public debt management
functions, based on thorough review of prevailing practices in Cambodia and on account of
international best practices; (ii) provide assistance to MEF in further enhancing institutional and
capacity development of Debt Management Office (DMO); (iii) provide assistance in
strengthening “middle office” functions; (iv) prepare and implement a training plan in debt

41
sensitivity analysis; risk management analysis for middle office staff and enhanced use of
DFMAS database; (v) continue technical assistance in further reviewing legal framework of debt
management and public debt management strategy, and in the preparation of regular debt
reports; (vi) support implementation of CAP and DAC Activities; (vii) provide assistance in
organizing training and workshop; (viii) perform any other tasks required in implementing the
project, including assisting ADB missions, to help achieve the objectives and goals of the
PFMRD within the approved budget; (ix) prepare inception, midterm, final, and quarterly
progress reports; (x) perform any other tasks required in implementing the project, including
assisting ADB missions, to help achieve the objectives and goals of the PFMRD within the
approved budget; and (xi) procure IT equipment and software under the component
ii. Computer-Based Debt Management System (CBDMS)

Specialist(s) - (Intermittent - 10 person-months)
65. The specialist will be a PDM public debt management specialist, who has had at least 8
years of experience with DMFAS of United Nations Conference on Trade and Development
(UNCTAD), especially DMFAS ver.6. The specialist should be sensitive to the cultural and
political economy context of Cambodia. The consultant will work closely (hands-on training is
needed) with the MEF staff for integrated debt-related data flows,, especially with the use of
information and communication technology at various stages of utilization and operation of the
DMFAS ver.6 through: (i) upgrading the DMFAS system from ver.5.3 to ver.6; (ii) extending
necessary technical support in capacity development around the DMFAS database; (iii)
providing technical recommendations on improvements in the design of debt-related data flow
within MEF and relevant outside institutions, in a manner feasible on account of DMFAS
functions; (iv) ensuring proper arrangement for efficient operation of the debt management
system, procedures, documentation for server and database back-up and recovery; (vi)
integration with aid management practices in the DMFAS software program; (vi) incorporating
reporting capabilities based on agreed formats; (vii) helping incorporate forecasting capabilities
to enable debt service forecasts to be generated; (viii) assisting with updating the debt
management system to address loans, grants, and government guarantees; (ix) reviewing data
capturing arrangements in the system to ensure all transaction data is captured accurately; and
(x) designing and conducting supplementary training for MEF staff on database and system
management, features of the debt management software, and generation of debt and portfolio
analysis from the DMFAS database using the software; (xi) preparing reports on the activities
undertaken to be included in the inception, midterm, final, and quarterly progress reports; and
(xii) performing any other tasks required in implementing the project, including assisting ADB
missions, to help achieve the objectives and goals of the PFMRD within the approved budget
iii. Legal and Institutional Development Analyst – (3 person-

months, intermittent)
66. The specialist should have relevant legal training and educational background for
addressing complex issues involved in adopting good public debt management standards,
particularly in the context of developing economies. Specially, the specialist should be familiar
with the latest thinking in public debt management standards and public finance issues. In
coordination with the team leader, and the team of consultants, the specialist will provide
necessary legal support for the continuing support of CAP Activities for phase 2, including: (i)
help the Royal Government of Cambodia to build up its public debt management legal
framework (from guideline, circulars, and eventually laws) in accordance to international best
practices; (ii) assist in the implementation of the public debt management sub-decree (or
Anukrets) and its proposed circulars (or Prakas) and ensuring the consistencies between the
42
Anukrets and the Prakas; (iii) provide advisory services to MEF in drafting and the introduction
of the Prakas on Public Debt Management; (iv) advise the MEF on the impact of integrating the
Anukrets and Prakas on Government Securities and Public Debt; Management, and supporting
rules and regulations, manuals, and job descriptions; (v) advise the MEF on the frequency of
Debt Sustainability Analysis (DSA); and (vi) continue to support the government’s debt
management strategy; and provide inputs to the various reports to be submitted to the EA, IA
and the ADB.
b. National consultant (1) for 10 person months on an intermittent

basis
i. Research Assistant (10 person-months)
67. The consultant will work closely with and assist the international consultants in support
of implementation of CAP Activities and provide administrative support for overall
implementation of the CBDMS, as well as other areas within the broader PFM Reform Program.
The consultant will (i) have basic knowledge of macroeconomic accounts; (ii) collect newly
released data and statistics related to public debt; (iii) compile macroeconomic data and debt
data needed for the Team Leader; (iv) review new legislations, guidelines, circulars and other
debt-related documents written in Khmer and summarize them in English for use by the
international consultants; (v) liaise with MEF departments concerned and collect other
information required as inputs to mid-term, draft final, and final reports; (vi) provide
administrative support to procurement of equipment under the project; (vii) provide logistic
support necessary for CBDMS-related and other training programs to be provided under the
project component; (viii) provide logistic support to organize the tripartite and other meeting(s)
for ADB review mission(s); and (ix) provide additional support which may be requested by
ADB’s project officer/international consultant(s), as needs arise.
4. TORs FOR Project COMPONENT 4: Strengthening the Effectiveness of

National Audit Authority
68. The principal audit adviser will coordinate activities with relevant officials of National
Audit Authority (NAA), Ministry of Economy and Finance (MEF), the Line Ministries, ADB
Resident Mission in Cambodia and the Developed Partners (DPs) and will adopt a well
sequenced cluster program approach consistent with NAA’s Strategic Development Plan and
the recommendations of the Audit Peer Review.
a. International Consultant
i. Principal Audit Adviser (State Audit) and Team leader

(Intermittent, 10 person- months)
69. The principal audit adviser will be required to have an advanced university degree in
accounting, audit, business administration, commerce or related field; or professional
accounting, auditing or related designation (CA, CPA, CIA, CISA, CFE) and will have a
minimum of 25 years experience of working in government audit, or preferably in one of the
Supreme Audit institutions of an INTOSAI/ ASSOSAI member countries. The specialist should
be sensitive to the cultural and political economy context of Cambodia. The specialist will have
strong knowledge of general auditing standards and practices; audit tools and techniques, and
will have extensive working experience in designing and implementing capacity development
and audit training programs for the national supreme audit institutions in the region. The

43
specialist must have demonstrated competence in INTOSAI Auditing Standards and ASOSAI
Performance Auditing Standards and Implementation Guidelines and International Standards for
the Professional Practice of Internal Auditing issued by the Institute of Internal Auditors (IIA).
70. Specific responsibilities will be to (i) strengthen audit function within NAA in the area of
audit recommended by the peer review; (ii) assist in formulating a training and capacity
development plan (iii) work with the NAA audit teams in conducing field assignments from
planning through to final reporting; (iv) design and deliver specific training to senior NAA staff;
(v) assist in implementing selected operational areas of the implementation sub-decrees under
the 2000 Audit Law and arrange workshops and seminars on the implementation decrees; (vi)
prepare and implement an action plan for strengthening NAA based on recommendations of
audit peer review and implement measures for capacity development; (vii) strengthen interface
and institutional arrangement between NAA, and Heads of Internal Audit Departments (vii)
assist in study tour; (viii) prepare regular reports incorporating analytical results based on the
above tasks for submission to NAA and ADB; (ix) facilitate improved coordination between the
Second Commission of the Parliament and the NAA and prepare terms of reference to clarify
NAA roles; (x) prepare inception, midterm, final, and quarterly progress reports (xi) perform any
other tasks required in implementing the project, including assisting ADB missions, to help
achieve the objectives and goals of the PFMRD within the approved budget. These TOR will be
further refined after the action plan is finalized, following the peer review recommendations.
b. National consultant
i. Audit Expert (continuous, 10 person-months)
71. The audit expert will have some detailed background of the public financial management
development, be well acquainted with recent developments in PFM reforms in Cambodia,
including the Government policy and procedures. The specialist will be thoroughly conversant
with Audit Laws, all relevant Decrees and Sub-decrees establishing the National Audit Authority
(NAA) and will be required to have experience in public sector audit. The audit expert will
possess an understanding and knowledge of audit and accountability issues in Cambodia, and
will be proficient in English. The position requires a significant amount of facilitation and
communication skill. The expert will undertake the following tasks: (i) assist the Team Leader
and the international specialists in all aspects of their task within the terms of reference; (ii)
under the guidance of the team leader, collect and analyze information, and make it available in
English in an organized, readable form; (iii) conduct research on specific topics as required by
the team leader and the international specialists; (iv) arrange and organize discussions, training
and workshops, and help the team leader and the international specialists prepare materials for
them, including translations of documents (if necessary) and interpretation of the discussions;
(v) act as an interpreter in meetings and training sessions, help translate documents (if needed)
and coordinate translation works to be contracted to others; (vi) prepare copies of training
materials, reserve the venue for training, and liaise with training participants and other resource
persons and (vii) perform other tasks that may be assigned by the principal audit adviser
5. Reporting and Monitoring Arrangements common to all components
72. The Team leaders for all the project components will regularly provide written reports in
English: (i) an inception report to include a comprehensive implementation plan to be submitted
within 4 weeks after the project starts including log frame outlining the implementation schedule;
(ii) regular progress reports every quarter; (iii) a mid-term report; (iv) draft final report (to be
submitted two weeks before the end of consulting services); and (v) a final report reflecting
44
comments by EA and ADB, to be submitted at the end of consulting services for each of the
project components. The Team Leader will be responsible for preparation of the various
reports. Specific timing and content of the reports will be discussed with EA, IAs and the ADB.
The reports will be submitted to EAs and IAS and ADB, and will include an assessment of the
outputs and activities, including performance indicators included in the Design and Monitoring
Framework. The consultant’s team will ensure that baseline data for each component is
gathered and monitored over time in the proposed Project. The team leader should provide
monitoring and evaluation reports to the EAs and IAs for respective components for review by
the Project Steering Committee and/or Project Management Units and/or Project Coordination
Group, and ADB. The performance indicators of the PMFRP Stage 2 will additionally be the
reference point for progress monitoring of Components 1 and 2. The reports will be discussed
with the EAs and the IAs and also with ADB. All international and national experts will report to
the Project Steering Group with Secretary-General, CAR in Chair and to the Project
Coordination Group headed by the Deputy Secretary General, CAR. For the National Audit
Authority, the Team Leader will report to NAA and coordinate with the Project Management Unit
(PMU) established for implementing externally-assisted project.
73. In executing the terms of reference (TOR), the team leader for Components 1 and 3 will
closely coordinate and liase with (i) the Ministry of Economy and Finance (PFM Reform
Committee Secretariat and DIC in ensuring consistency with the government-wide PFM
standards; and (ii) members of the PFM Working Group in MAFF, MRD, and MOWRAM;
including Department of Accounting, Finance and Planning in these ministries. The team leader
for Components 2 and 4 will closely work with the senior management of the CAR and NAA. All
team leaders should coordinate with development partners and the ADB Resident Mission in
Cambodia for specific tasks. The team leader will assist in procurement of goods and services
under the project in accordance with ADB’s procurement policies.
74. The Team Leader of each project component, will assist EAs to maintain separate
project accounts and financial statements, in accordance with the provisions of the Grant
Agreement and ADB Guidelines (Guidelines for the Financial Governance and Management of
Investment Projects Financed by ADB, 2002) to facilitate annual audit by an auditor acceptable
to ADB. In addition, the team leaders will assist MEF and NAA, to prepare and submit semi-
annual and annual reports to ADB, indicating progress made, problems encountered, and steps
taken to remedy the problems, a program of activities, and expected progress during the
implementation period. The reports will incorporate the project performance monitoring data and
all relevant financial data.
75. The Team leader and the consultant’s team will perform additional tasks required,
including assisting ADB missions, to help achieve the goals and objectives of the projects within
the approved budget.
76. The international consultants will be shared and will train the key officials of the three
RDMs, both on a common training platform such as the EFI and also under bilateral
arrangements. The national consultants will work with the focal point in each of the three RDMs
under supervision of the Team Leader.
VII. SAFEGUARDS
77. Poverty, Social and Environmental Safeguards. The project will not entail any
involuntary resettlement or have a negative impact on indigenous people or the environment. It
is classified category C for involuntary resettlement, impact on indigenous people, and impact

45
on the environment. The project is embedded in Subprogram 2 of the PFMRDP which is a

general intervention aimed at supporting sustainable economic growth. In that respect, it is
expected to have an indirect positive effect on poverty reduction.
46
VIII. PERFORMANCE MONITORING
A. DESIGN AND MONITORING FRAMEWORK

Update on Data Sources Assumptions
Design Performance Targets Subprogram I and/or Reporting and Risks
Summary and/or Indicators May 2010 Mechanisms
Impact Update: Assumptions
Strengthened Alignment of budget 2009 share for rural 2010 External Macroeconomic
prioritization of resource allocations with the development ministries was Advisory Panel and political
use; and improved National Strategic 2.8% (year of fiscal crisis) Report on the stability
governance Development Plan, and PFMRP
priority sectors 2010 budgeted share for Strong financial
maintained overall RDMs is 3.3% and technical
budget share (2008 support from
baseline: 3.0%) development
partners
By 2012, the World Governance indicators for (i) World Bank’s
Bank governance government effectiveness Worldwide Risk
indicators for improved from 17.1 in 2006 Governance Weak political
government to 19.4 percentile in 2008, Indicators governance and
effectiveness and and regulatory quality from ownership of
control of corruption 26.3 to 34.3 percentile in reforms
increased by 2 2008, and (ii) control of
percentile compared to corruption improved from 7.3
a
2006 in 2006 to 8.7 percentile in
2008
Anti-Corruption Law was

promulgated in 2010
Outcome Update: Assumptions
Improved PFM in the MAP implemented by Three RDMs have prepared PEFA MEF commitment
RDMs three RDMs to at least MAPS based on Assessment to pursue PFMRP
90% average Consolidated Action Plan for
achievement by mid- PFMRP Stage 2 activities, Reports from Effective
2011 relating to (i) and implementation progress three RDMs to coordination
strategic budget plan is reported to MEF monthly MEF between the MEF
and program (MAFF) and quarterly (MRD and rural
budgeting; (ii) internal and MOWRAM). development
audit; (iii) use of SOP, ministries
Procurement Manual,
and FMM for all Risk
externally-assisted Limited institutional
projects capacity to
implement policy
reforms
Outputs Update: Assumption
1. Strengthened Budget calendar, Second Stage of PFMRP Annual Budget MEF and line
financial management budget circular and the began implementation in ministries
framework to increase timely budget approval 2009; budget 2010 anchored committed to
accountability (predictability) in the revised PFSL; as of 30 MEF PFMRP implementation of
December 2009, staff in 36 quarterly and key target areas
Expanded use of the of 38 line ministries and/or annual monitoring under stage 2 of
banking system institutions had opened bank reports the PFMRP
accounts; and 26 are using
Debt management the bank accounts for salary
strategy; payments. Payment through Debt Management Risk
quality of domestic and banking system: 82.14%. Strategy Long lead time in
foreign debt records adapting to
and reporting Public debt management sub IMF Article IV financial
decree and draft public debt reports management
management strategy information system

47
Update on Data Sources Assumptions

Design Performance Targets Subprogram I and/or Reporting and Risks
Summary and/or Indicators May 2010 Mechanisms
drafted and discussed during 2009 and 2010 design and
2010 budget implementation
Update:
2. Strengthened financial BSPs FY2009–2010 BSPs Budget execution Assumption
management in rural prepared by three RDMs reports Capacity
priority sectors to Budget execution Budget execution rates for development plan
improve service delivery rates, including efficient the three RDMs in 2008 were MAFF, MRD, adequately
to rural population procurement and use MAFF 99%, MRD 94%, and MOWRAM resourced and
of banks accounts in MOWRAM 106%. In 2009 ministry records implemented
three RDMs the rates were MAFF 102%,
MRD 86%, and MOWRAM Evaluation report Risk
83%. of training Lack of capacity
provided under and political will to
All three ministries submitted ADB project implement reform
procurement reports to DPP agenda
(MEF) ADB project
output
(component 1 and
Internal audit unit fully Internal audit unit, comprising 2)
staffed in three RDMs, 48 staff in three RDMs
and all relevant staff received training.
completed training by
2010
500 staff from three 64 staffs from MRD, MAFF,

RDMs (including staff and MOWRAM were trained
from provinces) by EFI in 2009. In addition,
working in PFM related targeted training under the
c
trained by end of 2010 ADB project was provided to
353 people covering 22
ministries, besides five
ministry seminars (300
people) and six IT courses
(180 people). All training
materials uploaded to project
website.
Update: Assumption
3. Strengthening external Number of auditors NAA audited four externally NAA audit Operational
audit as a pillar of publictrained in auditing aided projects in 2009, and findings on independence of
accountability externally assisted the number of its overall externally- NAA
projects, and increase audits has increased from 2 assisted projects
in number of audits of in 2002 to 58 in 2008 and 83 Risk
externally-assisted in 2009 ADB project Insufficient budget
projects starting from output allocation for NAA
2010 (component 4)
Activities with Milestones for Subprogram 2, and the Project Inputs
1.1 Annual financial law (budget) for 2010 prepared and approved. MTEF 2011– ADB program grant of $10 million for
2013 updated; workshop on MTEF 2010–2012 held; and improvements made to the subprogram 2
presentation of the 2009 and 2010 budget.
1.2 PFM coordination working group for RDMs established and the first meeting Loan of $10 million equivalent for
was held in May 2010. subprogram 2
1.3 The draft Procurement Law under finalization and to be discussed with
stakeholders during 2010. ADB grant assistance of $5 million for
1.4 CAR finalized the modalities for putting in place the salary incentives in the institutional and capacity development
form of POCS in July 2010; Sub-decree on public debt and a draft public debt for subprogram 2 related project
management strategy was prepared and will be discussed by the PFM Reform
Commission in June 2010. Government in-kind contribution of $0.5
48
Activities with Milestones for Subprogram 2, and the Project Inputs
2.1 Ministerial action plans for implementation of stage 2 of PFMRP were submitted million
to MEF by the three RDMs.
2.2 RDMs submitted procurement activity reports to MEF regularly from 2009.
2.3 Training and workshops undertaken in SOPs, FMM, and procurement
procedures for externally aided projects
2.4 DIC continued to monitor, and support compliance with the provisions in the
GGFs for ADB-financed projects in 2010.
2.5 Internal audit processes and control standards enhanced through training in
core principles and adaptation to the specific internal control needs of the RDMs.
2.6 Training strategy covering three levels—general information, ministry
workshops, and individual sessions—developed, with time-bound master plan
under implementation, based on specific needs analysis of the RDMs in
implementing PFMRP.
3.1 Peer review of NAA was undertaken by the New Zealand Office of the Auditor
General in 17–29 May 2010; and an action plan will be developed by NAA based on
peer review recommendations for implementation during 2011-2013.
ADB = Asian Development Bank, BSP = budget strategic plan, DIC = Department of Investment and Cooperation, DMFAS =
debt management and financial analysis system, DPP = Department of Public Procurement, EFI = Economics and Finance
Institute, FMIS = financial management information system, FMM = Financial Management Manual, GDP = gross domestic
product, GGF = good governance framework, IMF = International Monetary Fund, IRR = implementing rules and regulations,
MAP = Ministry Action Plan, MDG = Millennium Development Goal, M&E = monitoring and evaluation, MEF = Ministry of
Economy and Finance, MTEF = Medium-Term Expenditure Framework, MAFF = Ministry of Agriculture, Forestry and Fisheries,
MRD = Ministry of Rural Development, MOWRAM = Ministry of Water Resources and Meteorology, NAA = National Audit
Authority, NPAR = national public administration reforms, NSDP = National Strategic Development Plan, PEFA = Public
Expenditure and Financial Accountability, PFM = public financial management, PFMRP = Public Financial Management Reform
Program, PFSL = public financial system law, POC = priority operating cost, RDM = rural development ministry, SOP = standard
operating procedure, TA = technical assistance.
a
Government effectiveness and control of corruption are two important worldwide governance indicators prepared by the World
Bank, based on country policy and institutional assessment and various perception surveys and data sources provided by
different organizations. These provide the basis for measuring these indicators.
b
MAFF, MRD, and MOWRAM.
c
ADB. 2008. Report and Recommendation of the President to the Board of Directors: Proposed Grant for Subprogram 1 to the
Kingdom of Cambodia for the Public Financial Management for Rural Development Project. Manila (Grant 0133-CAM).

49
A. Monitoring and Reporting
78. The monitoring of the project will be done through three mechanisms. First, the project
will provide that the executing agencies - MEF, the relevant agencies such as CAR and NAA -
provide ADB with quarterly progress reports on implementation. Second, through PFMRP
Steering Committee, monitoring of implementation and monitoring progress will be conducted
on a periodic basis. Third, the Government and ADB will undertake joint reviews of the project
every 6 months to assess progress in component and activities, the quality of activities and the
outputs produced, the performance of the project and identify issues and challenges. The EA
and ADB will conduct a midterm review covering a comprehensive assessment of achievement
against the project's expected impact and outcomes, and the modification of implementation
arrangements where necessary for the successful completion of the project. The Government
and ADB will continue to engage in active policy dialogue throughout implementation of the
project on sector issues, policy reforms, and dialogue with other development partners, reforms,
and other measures that may affect the project and on additional activities, actions, or reforms
that may be necessary or desirable for the successful implementation of the project.
B. Stakeholder Communication Strategy
79. Whilst formal stakeholder analysis or a participation strategy was not produced as a
discrete output, the scope of the project was conceptualized and formulated based on extensive
formal and informal stakeholder consultations. As part of the processing for the grant support,
extensive consultations were held with a wide range of stakeholders, including central ministries
and development partners.
IX. ANTICORRUPTION POLICY
80. ADB’s Anticorruption Policy (1998, as amended to date) was explained to and discussed
with the Government. Consistent with its commitment to good governance, accountability, and
transparency, ADB reserves the right to investigate, directly or through its agents, any alleged
corrupt, fraudulent, collusive, or coercive practices relating to the Program. To support these
efforts, relevant provisions of ADB’s Anticorruption Policy are included in the grant regulations
and the bidding documents for the Program and related project. In particular, all contracts
financed by ADB in connection with the program and grant-financed project shall include
provisions specifying the right of ADB to audit and examine the records and accounts of the
executing agencies and all contractors, suppliers, consultants, and other service providers.
X. ACCOUNTABILITY MECHANISM
81. People who are, or may in the future be, adversely affected by the project may address
complaints to ADB, or request the review of ADB's compliance under the Accountability
Mechanism.13
XI. RECORD OF PAM CHANGES
82. All revisions/updates during course of implementation should be retained in this Section
to provide a chronological history of changes to implemented arrangements recorded in the
PAM.
13
For further information see: http://compliance.adb.org/.
50


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Project Administration Manual: Project Number: 41373 Grant Number: September 2010

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Draft: 08/09/2010

Project Administration Manual

Project Number: 41373

Proposed Grant Assistance

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ADB – Asian Development Bank

A. Summarize the project's rationale, location and beneficiaries.

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4. Details of the 4 project components are:

1. Component 1: Improved PFM Capacity in RDMs (MAFF, MRD, and MOWRAM).

a. Provide specific project activities related to budget formulation (including

framework for Monitoring that delineates the mandates and

2. Component 2: Support to the Council of Administrative Reforms. Project will

3. Component 3: Strengthening Debt Management within the MEF Department of

• The CBP will focus on knowledge enhancement within MOF-DIC. The

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• In strengthening the legal and institutional framework, Component 3 will

4. Component 4: Continued Assistance to the NAA. The aim is to support to the

II. IMPLEMENTATION PLANS

A. Project Readiness Activities

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B. Overall Project Implementation Plan

Activity – 2.11- Assist in the design and establishment of a communications strategy

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III. PROJECT MANAGEMENT ARRANGEMENTS

A. Project Stakeholders – Roles and Responsibilities

5. Project Implementation arrangements .MEF, as the EA for Components 1, 2, and 3,

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B. Project Organization Structure

National Audit Project Steering Committee Council of

Project Organization Structure for Project Organization Structure for

H. E. AG = Uth Chhorn, PMU-NAA =

Project Organizational Structure for Components 1, 3

Council for Administration Reform PFM Reform Steering Committee

PFMRWG-MRD PFMRWG-MAFF PFMRWG-MOWRAM

Team of Consultants engaged through ADB projects

DIC = Department of Investment and Cooperation, PFM = public financial

Project Stakeholders Management Roles and Responsibilities

Ministry of Agriculture, Forestry and Fisheries (MAFF)

Ministry of Rural Development (MRD)

Ministry of Water Resources and Meteorology (MOWRAM)

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C. Key Persons Involved in Implementation

Ministry of Economy and Finance H.E. Mr. Vongsey Vissoth

National Audit Authority H.E. Ouk Saravudh

Division Director Jaseem Ahmed

Mission Leader Prasanna Kumar Jena

IV. COSTS AND FINANCING

Table 1: Project Investment Plan

A. Cost Estimate by Expenditure Category

Table 2: Detailed Cost Estimates by Expenditure Category

B. Allocation and Withdrawal of Grant Proceeds

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(ii) Percentages of ADB Financing

(iv) Disbursement Procedures

(v) Imprest Account: Statement of Expenditures

Table 3: Allocation and Withdrawal of Grant Proceeds

Proposed Allocation ($'000)