Sytem Audit of EJN

Background:
EJN has in recent years continued to grow both in terms of profile, programmes and funding, however an analysis of their systems indicates some internal/institutional challenges related to the growth for example in terms of the organization's financial and administrative and management routines. The organization has been slowed in adapting its internal systems to the rate at which it is growing.

The 2006 Audited Financial Statement showed some inaccuracies in reporting on project funds from NCA and budget comparisons were not provided as required by NCA and other donors such as DIAKONIA. The narrative reports submitted were weak on analysis - reporting largely on activities with less emphasis on impact. A further analysis also revealed lack of a clear organizational structure with no clear delegation of responsibility for development of management systems and routines. Gaps in the general management systems and routines of EJN were a concern.

NCA, DIAKONIA and Christian Aid, (key partners to EJN) resolved to conduct a systems audit, the outputs from which would be a report highlighting the areas needing improvement together with recommendations as to how that could be achieved. The funding partners are committed to assisting EJN as it is considered a strategic organization.

Purpose/ Objective:
• Identify internal management gaps in a fairly precise way and to
• Identify and prioritize some of the practical first steps to strengthen internal management systems and routines.
Methodology:
A consultant, Paul Taylor of CMDS (Accounting firm for Management & Development in the Non-profit Sector) was engaged to conduct a review of EJN's internal systems, to especially identify the gaps and to make concrete recommendations on how these gaps can be overcome. It was agreed that the partners will be monitoring both the review and implementation processes regularly to assess progress.

Key Findings:

• The 2007 work planning meeting identified a "gap" in terms of responsibility and resources for publications and communication.
• As other development organizations, the challenge lies in monitoring impact. EJN has no formal evaluative framework at present, even though there are principles and outlines for monitoring.
• Financial, governance and staff policies needed to be strengthened to achieve maximum input from the organization's work.

Recommendations:

• In terms of accountability and decision-making the consultant recommended to formally constitute a management team and to hold formal management team meeting.
• Budget for 2008 includes the costs of recruiting and remunerating a communications officers, for whom a job description will also be required.
• Increase use of mechanisms that enable delegates and participants at conferences and training workshops to make realistic and observable commitments.
• To make it become more possible to track the ways in which the work of EJN is influencing the work of the relevant NCC's, their constituencies and the targets of their advocacy and campaigning, work is undertaken not to increase the number of impact indicators but to refine and deepen the impact indicators.
• EJN, together with similar organizations receive funding from a number of partner organizations, therefore the need to report in a variety of different formats and at varying levels of depth is vital. The recommendation is that EJN uses its status as a partner of a number of development agencies to continue to dialogue with those agencies about a common reporting format or mechanism.
• Existing human resource policies do not fully cover all the areas of policy and procedure that would enable EJN's management and staff members to be clear about their rights and responsibilities, therefore the recommendation is that EJN considers purchasing a generic human resource (employment) manual that would be in compliance with current labor legislation and would cover all major aspects of human resource policy.
Also, it is recommended that the job descriptions of staff members are standardized and that they contain performance indicators that will enable formal appraisals to be carried out. Responsibility need to be clearly assigned for the maintenance of the full set of original HR documents that needs to be held per staff member.
• Although there are operational financial policies, they have not necessarily been systematically written down (and approved) and/or communicated to staff members, therefore it's recommended that EJN considers purchasing (and adapting, where necessary) a generic finance manual that would cover all major areas of finance policy and procedure.

Comments from Norwegian Church Aid (if any):

The NCA regional office has been closely monitoring progress on implementation of the activity plan drawn up by EJN to address the gaps. Regular contact is made both directly with the Executive Director and the Finance Manager. EJN is very receptive to the NCA efforts to strengthen its capacity and therefore collaborating in good spirit. So far steady progress is being made in terms of the activity plan. Some of the consultant's recommendations have already been implemented and changes for example of staff issues are being visibly noticed. NCA also agreed with the consultant on an accompaniment programme for EJN's Finance manager. Specific evaluation review discussions are held between NCA, DIAKONIA, CA and EJN.

NCA, DIAKONIA and CA are generally/so far satisfied with the progress being made by EJN and are confident that with time the challenges will be overcome to make EJN's work and impact more effective. EJN remains a strategic regional partner for all the parties hence the commitment to ensure that the accompaniment goes as smooth as possible.