Client

The Ministry of Finance, Lithuania

Challenge

In 1995, the Lithuanian Ministry of Finance started the development of the Governmental Budgeting Account and Payment (GBAP) system, based on Navision. The Danish Ministry of Finance, which selected Alna Business Solutions as the local partner, managed the project.

Solution

The project began with localisation, training and support tasks under the management of the Danish Ministry of Finance. The commitments of Alna Business Solutions to the project grew to include the development and enhancement of the GBAP system. In 1996, we took over the development of the Budget Management module. Our ERP specialists redesigned the entire application, and in 2001 developed an entirely new function for the GBAP system to allow it to effectively operate as a centralised payment system.

GBAP  System

GBAP, Lithuania’s centralised payment system, fulfils the following tasks:

• Effective cash management for the entire public sector
• Tight financial control of budget expenditures through the management of budget formation and the budget execution cycle
• Delivery of actual and reliable financial information to decision makers at all organisational levels

GBAP operates on four organisational levels:

1. Spending Units (institutions financed from the budget) under the control of Line Ministries/Departments
2. Line Ministries/Departments
3. Appropriation Managers – Independent Government Organisations
4. The Ministry of Finance/Treasury

GBAP consists of the following modules:

1. The Budget Formation Module manages the formation of the budget, along with its approval and modification. Budget figures are determined for approved economic classification accounts, functional classification accounts, programs or program activities, financing sources, organisational levels or organisations and time periods. The module can link the Appropriation Manager’s goals and programs in the budget formation process to government priorities. The set of measurement criteria can be determined to compare a program and its objectives to the actual results in the budget execution module.

2. The Budget Execution (Payment) Module manages the actual budget execution. The module performs payments for goods and services directly to suppliers by issuing payment orders from the Treasury to a bank. Direct payment to the supplier is made only after the payment request has successfully passed the budget control function. The budget control function compares a request for payment (an actual expense) with the available budget for the spending unit in question. Available budget is defined as the budget figure from the control budget compared with realised expenditures and commitments. This function is performed at all organisational levels in the system.

3. The Accounting Module manages the registration of all transactions to the General Ledger by determining all dimensions. Each organisational level accumulates all financial transactions from lower levels of dependent organisations. The module supports all the main accounting functions, such as registering transactions in user-determined ledgers, closing the financial year, etc.

4. The Report Generation Module. All modules mentioned above are supported by a number of different reports for each organisational level, which are obligatory or required for internal purposes within an organisation.

GBAP covers the installations in all the major budget institutions (approx. 900), whereas the remaining minor institutions (approx. 500) have access to GBAP either through the geographically closest major budget institution or through their Line Ministry/Department. It is planned to provide each budget institution with its own GBAP installation.

Technology

GBAP system is developed on Navision Financials v.2.6, and Navision 3.55.