IWMI Finance 2006 in general …
For IWMI, 2006 was a year of reforms—developing more effective and efficient structures by embarking on an alliance with WorldFish. This was pursued by setting up shared corporate services for organizational efficiency, programmatic collaboration for more effective research, and joint implementation of the ICT-KM project; to name a few. At IWMI, it meant structural changes in the corporate services, implementation of SAP, best practice sharing and joint projects with WorldFish. This also meant a continuous change process to keep pace with the increased customer demands. 2006 was also a year of the external performance and management review of the Institute.
2006 Financials in particular …
2006 was a year that demonstrated the proactive approach and strategic thinking by the Institute that helped deal with the blow of a major funding reduction and keeping its impact to a minimum. The reduction by a donor changed the landscape of an otherwise excellent year. In 2006, IWMI recorded a total revenue of $23.5 million, excluding Challenge Program projects not managed by IWMI. The revenue included $8.6 million of unrestricted funding; marginally higher than 2005, and $14.9 million of restricted funding. Total Institute expenses were recorded at $23.6 million with a resultant deficit of $0.1 million. The unrestricted funding marginally increased over 2004 and attributes to various increases and decreases in donor funding. IWMI’s overheads and personnel cost were maintained around the 2005 level and the cash balances remain healthy.Past years …
During the period 2000-2006, IMWI’s unrestricted funding grew at a compounded annual growth rate (CAGR) of 13% and 2006 was the year of consolidation of the growth of the past years. While the revenues more than trebled, expenses grew at a similar rate with the income to accommodate the growth and expansion. IWMI’s overheads as a percentage of total costs remained at 17% in 2006 as compared 23% for 2001 and 29% for 2000. This is mainly the result of the relatively low increase in support function cost in comparison to the increase in operations that more than trebled in the past years.Financial Indicators…
CGIAR has developed four parameters to measure financial health of the centers. These are - long term financial stability (recommended range 75-90 days), short term solvency (recommended range 90-120 days), efficiency of operations (indirect cost to direct cost) and cash management on restricted operations ratio. IWMI’s long term financial stability ratio is 64 days at the end of 2006, mainly due to reduced funding from a major donor, and the short term solvency ratio is at 100 days. The efficiency of operations ratio is 21% as in 2006 and the cash management on restricted operations is 30%.
Finance Links Unrestricted, Restricted Funding 2006 Income 1998 2006
