Project Southern Transport Development Project

Funding Asian Development Bank

Employer Road Development Authority

Quality Assurance Plan

Procedure MP 2.2 – Financial Management
Revisions
Index Date Modifications Prepared Checked Approved
by by by
0 02/09 Creation PS YTS GN
1
2
3

1 Objective of the procedure

This procedure describes the arrangements for the management of the Consultancy Contract with a
focus on the Consultant’s payment.

2 Scope of the procedure

This procedure is applicable to the services to be provided by the Consultant under its contract with
RDA- Sri Lanka.

3 Definitions and acronyms

QAP: Quality Assurance Plan PA: Project Accountant
MC: Management Consultant
TL: Team Leader
HD: Head of Department
OM: Office Manager
GC: General Conditions
SS: Special Conditions

4 Reference documents
QAP
Consultancy Services contract, including General Conditions, Clause 6: Payment to the Consultant
and Special Conditions Clause 6.a,b,c,d.

5 Description of the process

The payments to be made to the Consultant for this time-based Contract, by the Client consist of 3
types:
- Advance payment
- Monthly payments
- Final payment

N Procedure Documentation Responsibilities

Date Name Type Code Version Page

[20/08/2021] Financial Management MP 2.2 PM 2.1 0 1/3
N Procedure Documentation Responsibilities

Open a Local Bank Account; Ensure Validity

1 of Bank Guarantee and Insurance PP 0 HD

Provide to the Client an Advance Payment

2 Guarantee TL
No

Approve the Guarantee

3 CLIENT
Yes

CLIENT
4 Proceed to Advance Payment

Compile Consultant’s Staff and

Subcontractors Attendance; PS 1.1 RE & PA
5 Transportation; and Office Expenses

Calculate on the basis of the above and M210 PA

6 the advance recovery the sum of the Signed by TL
monthly payment, in each currency, due
to the Consultant, including VAT No

Approve Monthly Invoice

7 CLIENT
Yes

Proceed to Monthly Payment

8 CLIENT

Prepare Final Report and Final Financial

9 Statement PP 6 TL

Approve Final Report and Final Financial No

1 Statement CLIENT
0
Yes

Proceed to Final Payment CLIENT

1
1

5.1 Open Bank Account and Contract a Bank guarantee (Step 1)

The MC’s representative (TL or Country representative) is in charge of the opening of a local bank
account for the part of payments in local currency.
The TL shall then ask to the MC’s Head Office to get a Bank Guarantee pursuant to the consultancy
contract, in order to get and advance payment.
During the project, TL shall take care of adjusting the amount of the guarantee in accordance with the
advance recovery.
Finally, he shall close the Bank guarantee at the end of the period pursuant to the consultancy
contract.

Date Name Type Code Version Page

[20/08/2021] Financial Management MP 2.2 PM 2.1 0 2/3
5.2 Advance Payment to Consultant (Steps 1 to 3)
The schedule and modalities of the Advance payment are specified in the Special Conditions of the
Services Contract.
The guarantee(s) shall remain effective until the Advance Payment has been fully set-off. The example
form of the guarantee to be provided by the Consultant is usually given in an Appendix to the Services
Contract.

5.3 Monthly Payments (Clause GC 6.4.b & c.) (Steps 4 to 6)

5.3.1 General
Monthly payments consist generally of Remuneration (time-based) and Reimbursable Expenses
(actual and reasonably incurred by the Consultant during the performance of the Services).
They shall be usually paid by the Client within a period of 60 days upon receipt of the invoice by the
Client. Consequences of delays in payment must be notified in the consultancy contract.

For each different currency a separate invoice shall be submitted.

The invoices shall be accompanied by time-sheets for remuneration items (approved by TL),
invoices/vouchers and other documents proving reimbursable expenses at real costs.
At the beginning of the project, the TL shall prepare a template of the Invoice Form which will be used
for the whole project. He can ask for examples from the MC’s Head Office, or use format from his own
experience. TL shall then attach a soft copy of the template to this procedure, with the title: “M210:
Invoice to Client”.

5.3.2 Internal Procedure

The Project Accountant, with the assistance of the Office Manager, collects and stores all underlying
documents for all Monthly Invoices from the RE. The monthly time sheets (Cf. form in Annex II) shall
be signed by each individual professional staff for which a billing rate has been included in the
contract. All sheets shall be transmitted for approval by the RE to the Team Leader.
The Project Accountant prepares the Monthly Invoice and presents for approval to the Team Leader.

The Consultant shall set up and keep updated a summary table of all invoices (dates and amounts in
each currency) of the Consultant and resulting payments (dates and amounts in each currency) by the
Client. This summary shall be reported in the Monthly Report.

5.4 Final Payment (Clause GC 6.4.d) (Steps 7 to 9)

This payment is made conditional and subject to submission by the Consultant of a Final Report and a
final (financial) statement, specifically identified as such, which will have been approved as satisfactory
by the Client.

5.5 Review by the Client

The Client will review the supporting documents provided with the Monthly Invoice and Final Payment
Statement.
Only such portion of a statement that is not satisfactorily supported may be withheld from payment.
Should any discrepancy be found to exist between actual payment and costs authorised to be incurred
by the Consultant, the Client may add or subtract the difference from any subsequent payments.

5.6 Addendum
Cf. Procedure PM 2.2: Management of Contract Changes

6 Annexes
Number Code Title
Annex I M210 Invoice to Client Template

Date Name Type Code Version Page

[20/08/2021] Financial Management MP 2.2 PM 2.1 0 3/3