Annex 1 – LOGICAL FRAMEWORK MATRIX
Logframe Planning Matrix for Project
Programme name & number
TAX: COMPLIANCE AND RISK MANAGEMENT
MINISTRY OF FINANCE (MOF)
Twinning Number
Support for Political and SocioEconomic Reforms (STR2)
ENPI/2007/018-881
LB09/AA/FI/06
Total budget: €1,100,000
ENPI budget: €1,100,000
Overall Objective
To improve fiscal balance by increasing
revenue collection.
Benchmarks
Source of Information
Š
Government reports (Paris III
Š Increase in revenue collection
progress reports)
by 4% two years after project
Š
Reports prepared by the
completion.
Lebanese Tax Administration
Š Reports prepared by
international organizations
(IMF, WB, EU, …)
Project Purpose
To improve tax collection efficiency through
better risk management, compliance and
auditing techniques.
Benchmarks
Š Generated revenues are
improved by 4% two years
after project completion
Š Increase in voluntary
compliance by 2% two years
after project completion
Š Risk based approach audit
selection system is fully in
use in major tax offices
(Large Taxpayers Office
(LTO), Beirut, Mount
Lebanon) two years after
project completion
Source of Information
Š MOF annual statistics report
Š MOF annual Audit Plan
Š MOF Performance reports on
risk based Audit programs
Š MOF departmental Quality
Assurance reports
Assumptions
Š Allocation of needed
human and financial
resources to manage
the operations and
ensure sustainability
Š Tax payers respond
positively to
improvements in
audit mechanism
Š Maintaining tax
reform policy by the
Government
Š Political stability
Š Compliance, risk management
and auditing techniques
standardized across major tax
offices (Large Taxpayers
Office (LTO), Beirut, Mount
Page 1 of 8 Lebanon) two years after
project completion
Results
A - Risk Management
A.1 - Risk Analysis Techniques developed
and adopted
A.2 - Risk based audit programs developed
and implemented
A.3 - Audit Techniques developed and
adopted
Benchmarks
A - Risk Management
Source of Information
A - Risk Management
A.1 - Necessary risk analysis
and audit techniques are
developed and adopted by
major tax offices (Large
Taxpayers Office (LTO),
Beirut, Mount Lebanon)
two years after project
completion
A - MOF annual report
A.1 - Ability to assess and
prioritize risk elements
acquired and utilized
A1 & A2 - Risk based audit plan
A.1 & A.2 - Risk grids are
built and used in annual
audit plans
A.2 - Audit programs are
implemented
A - External assessments by
international organizations
(IMF, WB, EU) through
periodical evaluation and
progress reports
A1 - MOF annual audit plan
A1 & A3 - MOF internal reports
(national and regional)
quantifying revenues
generated from audit
Assumptions
Š Skilled and trained
staff can be retained
Š The design of the
Risk based Audit
programs is
implemented,
maintained and
operationally kept up
to date
Š Proper update and
adjustments of Risk
Grids on regular
basis
A2 - Statistics generated from
MOF database for evaluation
and follow-up purposes
A3 - Risk Management
A.3 - Audit techniques are
Techniques’ manuals and
improved, enhanced and
templates
implemented in major tax
offices (Large Taxpayers
A - Project progress reports
Office (LTO), Beirut, Mount
A - Project training material and
Lebanon) two years after
training evaluation reports
project completion
A.3 - New procedures and
reporting systems are set
and in place
A - Approximately one
hundred twenty (120)
auditors trained on the
state of the art compliance
and auditing techniques
Page 2 of 8 B - Compliance Management
B.1 - Multi-criteria, comprehensive
analytical database designed and
adopted
B.2 - Integrated management information
system designed and adopted
B.3 - Strategic and operational KPIs
developed and adopted
B - Compliance management B - Compliance management
B.1 - Database designed and
B - Project progress reports and
ready to be developed
deliverables
Activities
Benchmarks
B.2 - MIS designed and ready
to be developed
B.3 - KPIs are defined and
used
A - Risk Management Component
A.1
Risk Analysis
A.1.1 Risk Analysis Techniques
A.1.1.1
Develop Profiling
Techniques
A.1.1.2
Identify, assess and
prioritize the risks
A.1.1.3
Building Risk Grids
Source of Information
Assumptions
Š Project progress reports
Š The methods
developed are
applied in daily
operations
Š Training material and training
evaluation reports
A.1.1.1:
- Major economic
sectors
based
on
relevant indicators are
determined
- Training on profiling
is
techniques
conducted
- Profile template for
economic
selected
sectors are built
A.1.1.2: - Risk elements for
major
selected
economic sectors are
determined
and
Selection Criteria are
identified
A.1.1.3: Based on the profile
templates & identified
risk elements:
Risk
grids
are
developed
A.1.1.1: Profiling Techniques
Manual and Profile
Template for selected
economic sectors
Š Secondary databases
are made available;
e.g. Land Registry,
Customs, …
A.1.1.2: Selection Criteria for
major
economic
sectors
A.1.1.3: New Risk Grid and
Modified Risk Grids
and Combined Risk
grid
Š MOF will automate
the tax payers
profiles and risk
grids
Page 3 of 8 A.1.1.4
Enhance the research
and intelligence function
A.1.2 Audit Programming Techniques
A.1.2.1
Develop audit programs
A.1.2.2
Monitor, review and
evaluate audit programs
- Current risk grids are
updated & modified
- Combined risk grid is
developed
A.1.1.4: Training is conducted
for:
- Gathering & sorting
information
- Extracting info from
Profiles
Introducing and
Implementing
economic tax analysis
- Using patterns and
trends to shape audit
strategy
A.1.2.1:General and Specific
audit programs are set
using Selection Criteria
& risk grids
A.1.2.2: - Reporting templates
are provided
- Existing reporting
schedules are reviewed
A.1.1.4: Research Analysis
Procedures Manual
A.1.2.1: Template of Audit
Programs
A.1.2.2: Reporting Templates
and Revised reporting
schedules
- Finalized reporting
schedules are designed
A.2
Audit
A.2.1 Audit Techniques
A.2.1.1
Introduce Desk Audit
methodologies
A.2.1.2
Introduce Refund Audit
methodologies
A.2.1.1: - Training material
and content are set
- Training on Desk
audit techniques is
conducted
A.2.1.2: - Training material
and content are set
- Training on Refund
audit techniques is
A.2.1.1: Procedures of Desk
Audit methodologies &
techniques
A.2.1.2: Procedures of Refund
Audit methodologies &
techniques
Page 4 of 8 A.2.1.3
Introduce Criminal Audit
methodologies
A.2.1.4
Introduce different audit
methodologies and
sampling methods
A.2.1.5
Introduce Business
Valuations Audit
methodologies
A.2.1.6
Introduce Quality
assurance
methodologies
A.2.1.7
Introduce Audit
Communications &
Conflict Resolutions
Techniques
A.2.2 On-site Audit Training
A.2.2.1
Provide training on
specialized industries
conducted
A.2.1.3: - Training material
and content are set
- Training on
investigative skills and
building a criminal
audit case is
conducted
A.2.1.4: - Training material
and content are set
- Training on indirect
methods and sampling
techniques is
conducted
A.2.1.5: - Training material
and content are set
- Training on
identifying business
valuations cases and
methodologies to
determine Fair Market
Value used in audit is
conducted
A.2.1.6: - Training material
and content are set
- Training on Quality
assurance
methodologies is
conducted
A.2.1.7: - Training material
and content are set
- Training on
communication and
conflict resolutions
with taxpayers is
conducted
A.1.2.3: Procedures of Criminal
Audit methodologies &
techniques
A.1.2.4: Procedures of Indirect
Audit methods and
Sampling
methodologies
techniques
A.1.2.5: Procedures of
Business Valuations
audit methods and
Sampling
methodologies
techniques
A.1.2.6: Procedures of Quality
Assurance methods
A.1.2.7: Guideline of Audit
Communications &
Conflict Resolutions
Techniques
A.2.2.1: - Specialized industries A.2.2.1: Audit guidelines for
are determined
specialized industries
Page 5 of 8 - Training material and
content are set
- Training on audit
techniques for
specialized industries is
conducted
A.2.2.2
Provide training for
specialized topics in
international taxation
A.2.2.2: - international taxation
topics are identified
A.2.2.2: Audit guidelines for
International Taxation
- Training material and
content are set
- Training on topics in
international taxation
is conducted
A.2.2.3
A.3
Provide training for
electronic records
auditing
Study Tours
A.3.1 High-level group
A.2.2.3: Training on Computer
Assisted Audited
Techniques is
conducted
A.2.2.3: Audit guidelines for
Electronic Audit
Technique
A.3.1: - Study Tour program is
set
A.3.1: Study tour report
- Study Tour covering
the global picture of risk
management techniques
with the functioning of
the departments is
completed
A.3.2 Risk Analysis groups
A.3.2: - Study Tour program is
set
•
CAAT software
made available by
MS Administration
for demonstration
purposes during
the training
A.3.2: Study tour report
- Study Tour of
Compliance department
employees covering all
the functions related to
risk analysis is
completed
Page 6 of 8 A.3.3 Audit groups
A.3.3: - Study Tour program is
set
A.3.3: Study tour report
- Study Tour of Audit
department employees
covering the application
of the learned modules is
completed
B - Compliance Management Component
B.1
Data Base Building and Linkage
B.1.1 Establish links between
different systems
B.1.1: - List of pertinent
information sources is
identified
B.1.1: List of pertinent
information sources and
Guidelines
- Multi-criteria,
comprehensive analytical
database is designed
B.2
MIS
B.2.1 Design an integrated
Management Information
Reporting System
B.3
KPIs
B.3.1 Develop key indicators
B.2.1: - Business rules are
identified
- Templates for MIS
reports are prepared
B.2.1: Guidelines for MIS
reporting system and
Templates for MIS
reports
- Integrated
management information
system is designed
B.3.1: - Strategic and
operational KPIs are
developed
- Training on
measurement
methodologies and
performance
management is
conducted
•
MOF will develop
the designed
Compliance
Management
Information
System
B.3.1: Guidelines for
Performance
Management and followup and List of KPIs and
measurement
methodologies
Page 7 of 8 B.4
Study Tours
B.4.1 Data mining and linkages
techniques
B.4.2 Performance management and
follow-up
B.4.1: - Study Tour program is
set
B.4.1: Study tour report
- Study Tour of
Employees covering the
actual functioning of
learned components is
completed
B.4.2: - Study Tour program is
set
B.4.2: Study tour report
- Study Tour of
Employees covering the
handling of actual
performance
management and follow
up techniques is
completed
Page 8 of 8