EAC Secretariat PFM Coordination and Harmonization in EAC Countries Project Development Objective: Harmonize and coordinate the setting of Public Financial Management standards/directives amongst EAC Partner States (Kenya, Tanzania, Uganda, Rwanda and Burundi) in order to facilitate compliance of the Monetary and Financial Cooperation requirements in the EAC Treaty as progress is made towards becoming a Monetary Union. The IDF will also provide technical support to implement the standards/directives.      Implementation and Institutional Arrangement: The project will be implemented by the EAC Secretariat. The Secretariat will converge key stakeholders to agree on PFM standards which will be submitted to the Council of Ministers who will recommend the standards to be approved by the East African Legislative Assembly as directives. Under Article 8 subsection 4 of the EAC Treaty, EAC laws shall take precedence over similar national ones on matters pertaining to the implementation of the Treaty hence providing the necessary legislative backing to implement the directives. Thereafter EAC Secretariat will oversee the implementation of the directives by providing technical support. The technical support provided by EAC Secretariat will be demand driven and will take into consideration existing technical support being provided under the PFM programs in the Partner States and support from IMF East Africtac in order to avoid duplication of resources.  The proposed PFM standards/directives below are based on international good practices and will require: (a)	Coordination of the accountancy professional bodies in EAC to harmonize the syllabus of the professional accountancy courses covering both private and public sectors amongst Partner States and ensuring they are a highly reputable qualification. This will facilitate the mobility of professional accountants amongst the Partner States as it will not matter in which Partner State the qualification is obtained as the expectation will be that it is of an agreed quality. This coordination will be done despite the recognition that EAC has mutual recognition agreements for all qualifications amongst the Partner States as it will ensure there are common matriculations/standards with regard to the professional accountancy syllabus. The Inter University Council of East Africa will be engaged were necessary to achieve this directive.  (b)	Coordination of the Accountant Generalâ€™s of the Partner States working in close collaboration with the East and Southern Africa Association of Accountant Generals to support the implementation of International Public Sector Accounting Standards. This will increase the quality of the financial reports in order to assess the financial positions of the member states which is critical in having an effective monetary union. In line with this directive, EAC will also follow up with Burundi to harmonize its fiscal year to be in line with the other Partner States in order to ensure that financial reports for all the Partner States can be compared for the same fiscal period. (c)	Coordination of the Auditor Generalâ€™s of the Partner States to ensure there is compliance with International Organization of Supreme Audit Institutions (INTOSAI) auditing standards and value for money auditing systems are developed.  (d)	Coordination of the Heads of Internal Audit in the governments of the Partner States to comply with standards of professional practice of internal auditing issued by the Institute of Internal Auditors.  (e)	Coordination of the harmonization of the budget systems that will strengthen the credibility, comprehensiveness and transparency of the budgets in the Partner States as well as promote policy based budgeting. The coordination should specifically ensure there is harmonization of budget classifications, budget reporting and the measurement of budget deficits. (f)	Coordination of the Parliamentary Public Accounts Committees of the Partner States in collaboration with the East African Association of Public Accounts Committees to have good practice guidelines and standards while overseeing the utilization of public finance thus effectively conducting their role. The support should support Public Accounts Committees that review public expenditure for central governments, sub-national governments and state owned enterprises.   (g)	Coordination of the harmonization or approximation EAC procurement laws. The support should also provide technical support for EAC to develop an EAC Procurement Act that would be passed by the East African Legislative Assembly and used for regional procurements cutting across some or all of the Partner States as they currently use an amalgamation of best practices when conducting regional procurements. This harmonization will be done by working closely with country public procurement institutions. (h)	Working closely with the Ministry of Finance and Revenue Authorities of the Partner States, set standards for the percentage collection of revenue to GDP and monitor revenue reforms to achieve the set benchmark. This should increase on the efficiency of revenue generation which is critical in the development of the Partner States. The standards should involve the increase of the revenue bases of the East African Partner States by ensuring every individual and business is registered in a simple manner to capture particularly the informal sector into the tax net. Individual registration would involve having national identification cards and personal identification numbers for tax purposes.  In addition setting standards with regard to digital mapping is also necessary in order to account for every piece of land in the Partner States which would facilitate the mapping of taxable properties. The mapping could start with urban areas and move to rural areas. The support to EAC should also take stock of what has happened with regard to revenue reforms in the last ten years amongst Partner States and what can be done going forward to increase revenues. (i)	Coordination of the strengthening of financial reporting amongst the media and promotion of the use of civil society as a key player in the monitoring of service delivery working closely with the governments of the Partner States.  (j)	Coordination of the EAC Partner States to harmonize or have common statistics that will facilitate the measurement of GDP. The Bank's support to EAC will have a clear set of operational deliverables that include: (i) support to the EAC in drafting clear, well thought out PFM directives that would bring these countries' PFM systems together based on existing good practices; (ii) developing technical guidelines that explain the directives and guide the Partner States in their implementation; (iii) setting-up a community of PFM practitioners that would help in implementing the directives; (iv) having the directives passed by the East African Legislative Assembly which would imply that the directives are observed and implemented in all the Partner States; and (v) having TA to support the Partner States with developing implementation plans ensuring that there is ownership, supporting the implementation of the directives and developing the reporting mechanisms on the directives for the Partner States.