NGO Another Way (Stichting Bakens Verzet), 1018 AM Amsterdam, Netherlands.


                                                                                    01. E-course : Diploma in Integrated Development (Dip. Int.Dev.)


Edition 01: 11 December, 2009



Tekstvak:         Quarter 3.










Study points : 05 points out of 18

Minimum study time : 125 hours out of 504


The study points are awarded upon passing the consolidated exam  for  Section C : The Model.



Block 8 : Economic aspects.


                            [Study points 03 out of 18]

[Minimum study time: 85 hours out of 504]


The study points are awarded upon passing the consolidated exam  for  Section C : The Model.



Block 8 : Economic aspects.


Section 1 : Project costs.[40 hours]


01.  General introduction. (02 hours)

02. General sketch of the financial structures.(02 hours)

03. Short budget analysis. (02 hours)

04. Budget organisation. (02 hours)

05. Description of the local contributions. (02 hours)

06. Method for calculating local contributions. (02 hours)

07. Relationship between local money and formal money.(02 hours)

08. The budget (02  hours)

09. The budget in a form requested by donors/financing parties. (02 hours )

10. Annual expenses (budgets per year). (02 hours )

11. Quarterly budgets. (02 hours )

12. Excel spreadsheets for the preparation of the budget.(02 hours )

13. The sustainability of the system.(02 hours )

14. Tenders. (02 hours )

15. The bank structures with limitations imposed on the project coordinator.(02 hours )

16. Auditing structures. (02 hours)

17. Protection of donors and financing parties.(02 hours )


Section 1 report :  (06 hours) .




Section 1 : Project costs. [40 hours]


15. The bank structures with limitations imposed on the project coordinator.( At least 2 hours )


The banking structures indicated in the Model may vary from one individual project to the another. Integrated development projects are different from traditional development projects. Most of the activities are carried out by the populations themselves within the framework of a local money system set up in an early phase of project executions. Everything is done to try to ensure that the goods and services needed for the project structures can be provided under the local money system set up. This means that the formal money needed for the projects is in principle destined to cover the formal money costs of goods and services which cannot be provided locally.


Having said that, no-one (except the banks) profits from converting international donor funds in Euros or US$ into the formal money of the country where the project in question is taking place, only to re-convert it back into Euros or US$ to pay for goods and services provided from abroad. That would lead to wastage of bank costs for the two conversions, and de facto reduction of the amount available for the project itself.


Initial funding is therefore held in an international Euro (or US$) bank account in the name of the NGO responsible for project execution. Funds are transferred to a formal money account in the currency of the country where the project is taking place (the host country) in accordance with project requirements. These funds are used to cover formal money requirements spent inside the host country itself.


The coordinator (or coordination group) responsible for each project acts independently of the NGO responsible for project execution, which acts as controller of the coordinator or the coordinating team. The NGO responsible for  the execution of the project is  «the parliament » in relation to the project. The coordinator is the «government » of the project.


Refer to part 07. The cooperative for project execution in the section the division of tasks of the third block solutions to the problems of the course. The NGO cooperative responsible for project execution controls the capital accounts of the project.


Article 15 of the 05.08 Statutes of the NGO responsible for project execution provides “The project coordinator opens and operates all executive bank accounts including current accounts  in the name of the project during the execution phase.”


The coordinator replenishes the executive bank  accounts from time to time as required by the project circumstances. To do this he/she applies to the NGO responsible for project execution for transfer of funds from the capital account (managed by the NGO) to the executive account (managed by the coordinator).


Once the funds have arrived in the executive account controlled by the coordinator, the coordinator is free to run the account without further formality, for smaller sums. For larger sums he must get the co-signature of the Chairperson of the NGO or another person nominated by the board of the NGO for this purpose. For large amounts, the Coordinator must apply for the express agreement of the board of the NGO responsible for project execution.


The activities of the project coordinator and his/her team are subject to permanent on-going audit control as provided  in articles  17-20 of the Statutes of the NGO.


In practice, the coordinator is given wide flexibility of manoeuvre, without formalities. On the other hand, he/she is subjected to very strict on-going permanent control of his/her activities.


The Board of Directors of each NGO for project execution will organise its activities as it thinks best. In principle, the Board formally adopts the project («passes the law » ) including the project budget. This would normally mean that the Coordinator is authorised to spend the funds available to him/her on conditions the budget terms are respected and that he/she answers to the permanent commission for  on-going audit for his/her actions.


Look at this  drawing of the bank structures.


1. Research.


On one page, explain the the members of the board of the NGO responsible for project execution how the project banking system works.


The project coordinator’s role as described in the  statutes of the NGO as :

“Article 15 : The project coordinator  is appointed for the duration of the project and is responsible  for  the execution of the project until transfer of the structures created to the management cooperative [name of the Cooperative].

The project coordinator records the status of inventories, accounts, and budget documents submitted to the Board of Directors.

The project coordinator opens and operates all executive bank accounts including current accounts  in the name of the project during the execution phase.

The project coordinator answers to the Board of Directors and informs the Audit Commission of his or her activities, payments and receipts.”

Article 16 : The project coordinator’s salary is covered as a separate item in the project budget.”


2. Opinion.


You are considering becoming project coordinator for the integrated development project for your chosen area. On one page indicate on which conditions you would be prepared to do it.


3. Research.


Take three important development projects in your chosen area. (If necessary choose three projects in your country). For each one, on one page (that means three pages for all three projects together),make a comparison between the banking system and the limitations imposed of those responsible for the projects on the one hand, and those foreseen for integrated development projects on the other hand. In each case, draw your conclusion. Begin your work with a brief introductory passage. End it with a summary of your findings.  


 Eighth block :  Economic aspects. 

 Eighth block :  Project costs.

Main index  for the Diploma in Integrated  Development  (Dip. Int. Dev.)

 List of key words.

 List of references.

  Course chart.

 Technical aspects.

 Courses available.

Homepage Bakens Verzet


"Money is not the key that opens the gates of the market but the bolt that bars them."

Gesell, Silvio, The Natural Economic Order, revised English edition, Peter Owen, London 1958, page 228.


“Poverty is created scarcity”

Wahu Kaara, point 8 of the Global Call to Action Against Poverty, 58th annual NGO Conference, United Nations, New York 7th September 2005.



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