Fiscal Policy and Expenditure Management Program (FPEMP) Quarterly Report June – August 2016

The program is sponsored by the United States Agency for International Development (USAID) and implemented by DAI Global, LLC. The main counterpart for these activities is the Ministry of Finance (MOF) of El Salvador. FPEMP has three main components: Component A, Enhanced Public Expenditure Management; Component B, Improved Revenue Mobilization; and Component C, Strengthened Private Sector Engagement. The program's goals are to build a modern and transparent public expenditure system, strengthen tax policy and administration, improve revenue collection, and facilitate private sector outreach. During the reporting quarter, June 1 to August 31, 2016, FPEMP continued to advocate and advise the MOF and the Government of El Salvador (GOES) on measures to achieve and guarantee fiscal sustainability. The program recommended that the GOES improve budget formulation and execution practices, formulate the expenditure budget based on net revenues, and implement the budget commitment installments. FPEMP also completed the final modification of the charts of accounts description manual, which was submitted to the Government Accounting General Directorate (DGCG). The program decided to move forward with the development of the Accounting General Policy Manual, due to the fact that the DGCG does not have the technical capabilities to develop it. It is expected that the manual will be completed in 2017. In addition, FPEMP supported the implementation of the e-procurement system (COMPRASAL II) to improve public expenditure, save resources, and fight corruption. The program also assisted the MOF in the creation of the Public Procurement Ombudsman Office and monitored the activities of the EXPRESATE Center. The program's quarterly results include the implementation of COMPRASAL II libre gestión, the development of the chart of accounts description manual under IPSAS, addressing fiscal sustainability challenges, and conference on the new tax reform delivered to the CAPRES Legal Advisors. Other activities included the stabilization of the CSMS II Collections Call Center Module, the final assessment on the implementation of the municipal fiscal transparency portal development, and the support to the National Financial Management System (SAFI) II call center implementation. FPEMP's progress and achievements during this quarter are presented according to the program's three components: Component A, Public Expenditure Management; Component B, Tax Revenue Mobilization; and Component C, Private Sector Outreach. The program's goals are to build a modern and transparent public expenditure system, strengthen tax policy and administration, improve revenue collection, and facilitate private sector outreach.