Effect of Capacity Development on the Financial Management System of local NGO’s: The case of Pact Ethiopia Implementing Partners

Abstract

This study was conducted to analyze the effect of the capacity development support of Pact on the financial management systems and practice of its implementing partners in the use of Pact grants for the implementation of the agreed up on program/project objectives. The study design was quasi experimental type of study. Both qualitative and quantitative approaches were used in the collection and analysis of data to meet the study objective. Data on the variables of interest was collected using structured management capacity assessment tool (MACT), interview guide and document review. A total of 48 employees and management bodies of the implementing partners and comparison groups as well as staffs of Pact concerned with grant management and capacity development supports were involved in study. The selection of the organizations and staffs was done via purposive sampling. The findings of the analysis result showed the capacity development support of Pact was effective in bringing about improvement in the accounting procedures, internal control, financial management, and sub grant financial management system and practice of the implementing partners. To further enhance the effectiveness of the capacity development support making grant monitoring visits aimed at providing mentoring support a team effort; rotation of the monitoring team members and backing performance expectations with corrective administrative measures are forwarded as recommendations.