Financial Management In Ethiopia Case Study
CHAPTER ONE INTRODUCTION
1.1. Background of the Study
In Ethiopia, all Non-Government Organizations (NGO’s) have to make strategic choices regarding their resources by identifying priority activities, donor’s interest & Government and Charities and Societies (ChSA) reporting requirement. Even within the Civil Society Organization (CSO) itself, the different departments compete for resources with maximum approved ceilings and having in place a good financial management system is expected to provide needed tools in order to make timely decisions on fund allocation as well as monitoring performance that adhere to the reporting requirements set by Donors and Government. The financial processes of recording, planning, monitoring and controlling have to be done on an ongoing basis in conjunction with other functions of the organization for maximum impact to achieve the objectives of the organization.
With the increase in the number of CSO’s operating in Ethiopia and to address the need for a regulatory body, in 2009 the Ethiopia Government issued Proclamation No. 621/2009. This proclamation provides procedures for the Registration and Regulation of Charities and Societies there by establishing Charities and Societies Agency (ChSA) under the Ministry of Justice. Then Regulation No.168/2009 was issued by the
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The primary focus of ChSA is ensuring the total resources of the CSO’s under its registration are utilized only for the objective the CSO is registered for. As well it monitors the CSO’s performance is efficient and meets set reporting requirements. In order to ensure this the financial and activity reporting of each NGO registered under the ChSA is reviewed strictly by the agency every year and continued operational approval is dependent on approval of submitted reports compatibility to set regulations of the
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