Assignment on

How we say “GO” for a new project

Submitted by
Md. Masum Chowdhury
CMA Australia (5th Batch)
Bangladesh

May 2021

Md. Masum Chowdhury, CMA (Aus), 5th Batch, Bangladesh Page | 1

 INDEX:

Sl. No Contents Page Number

01. Introduction 3

02. Budgeting Process (Figure 1) 4

03. Master Budget (Figure 2/3) 4-5

04. GAP Analysis (excel chart attached) 5

05. Go-NoGo Exercise.xlsx 5

06. DEA Mapping with MB 5

07. Donor Budget Details 5

08. Budget Summary 5

09. New Proposals (Figure 4) 7

10. Partnership 7

11. UN Donors 7

12. Non-UN Donors 7-8

13. Government 8

14. Corporate Donors 8

15. Foundations/Charities 8

16. Challenges 8

17. Conclusion 9

18. Notes 9

19. Bibliography 9

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Introduction:
I, Md. Masum Chowdhury, have been working for Save the Children (SC) in Bangladesh
since 2018. Currently I am playing the role of Senior Manager- Finance, (Finance Lead)
at Cox’s Bazar area office. SC is a non-profit international organization and is actively
delivering humanitarian assistance to the displaced Rohingya populations since 2017.
Being a child-centered organization, SC’s interventions are multi-dimensional with
seven thematic sectors – Health, Nutrition, WASH, Child Protection, Education, Shelter,
Food Security & Livelihoods.
SC has secured more than 100 million USD from diverse donors to deliver its lifesaving
interventions through 100+ projects for the Rohingya refugees and affected host
communities in Cox’s Bazar. These projects are with 3 months to multi-years. As the
Rohingya response has been shifted from the acute emergency (category 1) to the
protracted crisis (category 2), the funding trends are also getting curved from 2017 to
the recent years. However, SC has received significant funding (almost 6 million USD)
from the donors to address the COVID-19 crisis and recent fire incident in the Rohingya
camps.
SC has 29 member countries who are responsible for raising funds for its 119 country
offices across the world. The member countries coordinate with country offices in
response to the request for proposals. SC’s member countries are directly engaged with
the donors while its country offices are engaged in implementation of the programmes.
The most popular word for whether a project will be initiated or not is known as the term
“Go/NoGo”. The “Go/NoGo” decision is made after potential Call for Proposals is identified
and helps not-for-profit international and national non-government organizations
(I/NGOs) to determine whether they will pursue the opportunity or not. The decision to
‘Go’ for a new opportunity is made considering many aspects and these include –
relevance (strategic alignment), economy, efficiency, effectiveness, impact, and
sustainability. I/NGOs have their organizational vision and mission, aligned to their
countries’ plans and goals, to ensure the quality of life for the people who are
marginalized and less privileged through improving access to development and
humanitarian services. Cost effectiveness is one of the dominant aspects to decide a ‘Go’
for an opportunity so that maximum outcomes are ensured through realistic
investments and large percentages of funding are utilized for the targeted beneficiaries.
Financial capacity (i.e., efficiency) to manage is also an important factor to decide a ‘Go’
for a new opportunity.

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Budgeting Process:
In Development sector (INGO/Non-Profit), Zero
our current practice is preparing a MB Forecast

(Master Budget) during the early week of Q4

for every next year. During October we are
preparing MB for next year based on the
assumption and current trends. In the first
week of January, we are preparing Zero
Master
Budget MB 1st
Forecast
Forecast budgeting based on more accurate
funding. And then the first forecast in March
is based on the actual budget as well as the
cost up to March and Plan for April to 2nd
December. Then the second forecast on the Forecast
first week of June is based up to June actuals
and planned activity and budget for the rest of Figure 1: Budgeting Process
the year. And then again new year MB on the first
week of October. This cycle is continued accordingly towards the life of the project.

Master Budget:
The MB (Master Budget) and the costing
and budgeting process round the year
help organization to understand the future
Costing needs and essential requirements to run
Requirement
for the Year - the organization in different shapes for
different periods. An organization can
Available
fund +
Pipeline
easily understand or may take decision on
funds
costing shape based on available funding
and pipeline funding. A master budget
take place with a rigorous discussion with
different sector leads. They find out the
= Surplus(GAP) for the year
programmatic cost based on the situation
in working area, as well as the
Figure 2: Master Budget programmatic personnel cost what
needed for quality accomplishment of the
activities within the targeted timeframe.

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Each and every organization have different
costing structures to accomplish their results. #1 Program Activity Cost 50%
But in most cases donors are restricted and
have their own compliances where an
#2 Program Salary Cost 30%
organization is not allowed to have their
suggested support/operation cost. Which
ultimately requires a thorough analysis and a #3 Support Cost 20%
strong accounting brainstorming on it to fit to
the cost within the limited flexibility and take #4 Total Budget 100%
calculative risk to help to run the ship in safe
zone. Figure 3: Budgeting

In MB process, some funds already

committed by donors and some are
yet to. For these pipeline
Restricted requirements, management need
Active Fund to understand the flexibility rate of
Unrestricted donors and as well consider the
MB

NCE due to political situation, Covid

situation and any unexpected
Pipeline Fund Restriction % situation what have a significant
impact to run regular activities in
Figure 3: Budgeting facilities. Based on all these,
Management Accountants need to
suggest the cost recovery plan in
the MB from which periodically
management can understand the GAPs and take decisions to have a safe path for the
whole year. The MB itself suggest cost recovery plan, percentage for all heads and need
for the management what they should consider for upcoming project/ proposals to
donor.
GAP Analysis:
Based on the MB cost management accountants will prepare a monthly basis “GAP
analysis” for the management from which management can understand the funding
requirements for the next periods of the year.

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 (all figures are in USD, for FY 2021)

MB NEW GAP
Education Programme GAP
Requirements Project Covered
Education Activities 75%
1,140,493 (562,118) 419,142
Education Personnel Cost 32%
420,731 (132,002) 42,625
Support Cost 96%
252,245 (64,134) 61,272
Total
1,813,469 (758,254) 523,038 69%

Go-NoGo
Exercise.xlsx

So, as per the abovementioned chart management can realize that the requirement for
FY 2021. Therefore, the proposal development team will seek attention of donors on the
specific activities to continue the support to the children.
A Go-NoGo excel [Go-NoGo Exercise.xlsx] exercise has been embedded here to
understand how the management take decision on GO-NoGo proposals.
Guidelines for the excel sheet: In the excel sheets it includes 3 sheets.
1. DEA Mapping with MB:

During the development stage of a new proposals set of activities are named as
per donor guideline which are mapped with nature of cost, theme, and major
program heads with a discussion with different program colleagues.

2. Donor Budget Details:

A donor budget details placed here including all active, pipelines and new
opportunities.

3. Budget Summary:

Budget summary includes the MB forecasting, Active funding and GAPs based on
these; management have a clear idea on future needs. They can easily map out
the needs and how much has been going to cover by any new proposals.

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New Proposals:
Donor comes to the implementing partners with specific guidelines as well as want to
see how cost effectively the services plan to continue in the facilities.
Though this is a nonprofit, however a break-even point set by both parties to make all
parties avail a win-win situation. Donors always pay attention regarding how much the
implementing partners budgeted to ensure services to the beneficiaries. On the other
hand, implementing partners want to ensure the operation cost so that, they can
accomplish the activities in line with their own and donor policies.
Partnership:
In most case scenarios, INGO set a local partner
GAP
with an evaluating partner based on their Analysis
capacity on program implementation, local
acceptance and previous/current strengths.
Seek
Partnerships always help to breeze the gaps GO/No Go
Attention
between the local government, community, and New
beneficiaries, as they are or to be already Proposals
established on that particular area. This
promotes localization and sustainability of the GAP
Select
outcome of the project. Partner
recovery
%

These local NGOs not only empower the local

community but also create job opportunities to Figure 4: New Proposal
the local people which later on leads to
increase the economic status of that area.
Donors: INGOs especially get funding from –
1. UN Donors- Unicef, UNDP, UNHCR, UN-Women, IOM, WHO, WFP, UNFPA etc.:
There are some government and institutional funding mechanisms that do not directly
transfer funds to the I/NGOs, however, the funds are channelized through the UN
agencies in line with their organizational mandates. For example, WFP receives funds
from USAID and channelizes these funds to I/NGOs based on cooperating partnership
modality to implement food programme. As I/NGOs receive funds from UN agencies in
national currency, they do not require any FD6 or FD7 (Foreign Donation) approvals from
the NGO Affairs Bureau. Exception is for UNOPS, as this agency transfers the funding of
FCDO (formerly known as DFID) to the I/NGOs in donor’s currency.
2. Non-UN Donors – ECHO, GAC, Sida, Danida, FCDO, GFFO, Aus- Aid, BHA etc.:
INGOs based on their partnership agreement with the bilateral donors receive funds
directly. The funds received by the INGOs can be utilized directly or through national
NGOs that are sub-contracted. While receiving funds from outside Bangladesh in foreign

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currency, INGOs requires an FD6 or FD7 (Foreign Donation) approvals from the NGO
Affairs Bureau.
3. Government: I/NGOs receive funds from the government of Bangladesh as well.
In principle, Asian Development Bank and World Bank cannot fund directly to the I/NGOs.
They can fund to the relevant ministries, and the ministries make contracts with I/NGOs
to deliver specific projects. For this sort of funding, I/NGOs do not require any FD6 or
FD7 (Foreign Donation) approvals.
4. Corporate Donors: There are some corporate donors (such as, Unilever,
Chevron, Standard Chartered Bank, Ready-made Garments (RMG) industries, and
UNIQLO, …) who donate funds to the I/NGOs as part of their Corporate Social
Responsibility (CSR). This funding if received in country with national currency does not
require any FD6 or FD7 approvals. The nature of funding from the corporates is flexible
and the funding can be used for innovation practices.
5. Foundations/Charities: I/NGOs also receive funds from foundations or
charities, such as, C&A Foundation, Bill Gates & Melinda Foundation, Foundation Nere,
Posner Foundation, Qatar Charity, etc. These funding are flexible in managing and these
also require FD6 or FD7 approvals.
Challenges:
Sometimes, funding trends of donors and other INGOs also have an impact on ‘Go/NoGo’
of a new proposal. Here are some major considerable areas to say ‘Go’ for a new project-
1. To have a relation with new donors sometimes organization need to subsidize the
project from their own emergency/pool funds.
2. To continue services to the beneficiaries.
3. To achieve the organizations’ goal.
4. Ensure services from Day 1 to any emergency responses.

Considerable area to say “NoGo” for a new project-

1. If the project has a conflict with country interest.
2. Project may occur perils for beneficiaries.
3. Not budgeted properly, difficult to accomplish work in line with maintaining
quality.
4. If the funding amount is below the organizational thresholds
5. Grants is related on “Gifts in Kind”, but no cash will be providing for operation
cost.

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Conclusion:
Every I/NGO must be sought for a “Go/NoGo” decision while an opportunity is identified.
Senior Management Team (SMT) basically decides while Country Directors (CD) for
INGOs and Executive Directors (ED) for national NGOs are the decision-maker and the
rest of the members are consulted. The SMT usually focuses on five major principles –
strategic, technical, operational, finance and partner – to consent for a ‘Go’.

Notes:
DEVELOPMENT Sector – Development sectors refer to I/NGO-NON-PROFIT sector, who
do not have profit & loss, rather have income & expenditure.
MB= Master budget, a budget including all current funding & costing trends, has been
prepared prior to year start to understand next year plans and control the costs.
Zero Forecast= Prepared in the beginning of the year, which give a more accurate
pictures on MB.
Q4= 4th Quarter of the year, Oct-Dec period for (January to December financial year)
Pipeline= The new opportunities which are very likely to add with current funding
NCE = No cost extension, a project will extend for a new period, but donor will not give
any additional cost for the incomplete activity completion.

Bibliography:
o Proposal Development Process, Save the Children International, October 2020.
o Guidance Note on Master Budget, Save the Children International, 2019.
o Awards Management Manual, Save the Children International, 2015.
o Save the Children’s Global Partnership Strategy, 2019 (Revised).
o Master Programme Agreement (MPA), Save the Children, 2011.

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 Thank You

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