sop dec 2009 version

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UNDP LEARNING SERIES, December 2009

S TANDARD OPERATING P RACTICES

United Nations Development Programme

Advisory Committee on Procurement (ACP)


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Introduction A journey into ACP1

1 Advisory Committee on Procurement (ACP)

1.1 Scope of Review3

1.2 Roles and Responsibilities5-7

i. Requestor5

ii. ACP/RACP Secretary5

iii. ACP/RACP Members6

iv. ACP/RACP Chair6

v. CPO/RCPO7

1.3 ACP Review Cycle7

1.4 Types of ACP Review8

i. ACP Review8

ii. Direct Review8

1.5 Types of Submissions8-10

i. Competitive Process8ii. Direct Contracting8iii. Post-Facto

Contents


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iv. Ex-Ante : Procurement Road Map9v. Consulting Fee10

2 Case submission to the ACP A walk through11-17

3 Checklist18-22

3.1 ACP Submission Checklist18

3.2 Quality Assurance Checklist21

3.3 Value for Money Checklist

224 Overview of ACP Website

23

ANNEXURES

Abbreviations

UNDP Learning Series, Advisory Committee on Procurement (ACP), December 2009

For further information, please contact UNDP ACP Office, One UN Plaza, New York, NY 10017

Email : [email protected]


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1 ACP/ LEARNINGGUIDE

d) Achieve value for money

Risk Assessment

a) Unbiased Specificationsb) Technical and Financial capacity of Vendorc) Procurement capacity of the business unitd) Performance and quality requirementse) Shipping termsf) Referencesg) Contract Managementh) Terms & Conditions (Type of Contract)

How can I do a submission to the ACP/RACP for review ?

All submissions to the ACP/RACP should be done online through the ACP Online website( http://acp-online.undp.org )

What other roles does the ACP/RACP play in UNDP Procurement ?

In addition, to reviewing cases submitted by the Country Offices and Business Units, theACP undertakes the following tasks :

Procurement Oversighta) Update of Procurement Dashboardb) Follow up with the Country Offices on implementation of the conditions

subject to which their cases were approved Delegation of Procurement Authority

a) Analyze procurement volume and capacity of CO for recommendingincreased delegation f authority ;

b) Provide advise to the CPO on specific delegations. Capacity Development

a) Organize training for CAP Members, Head of Units in HQb) Conduction of Regional Procurement Workshopc) Development of On-Line training material (risk assessment, CAP Orientation,

ACP Orientation ) Knowledge Management

a) Sharing of Lesson learnt from ACP/RACP Meetings Maintaining Roster of Roving Procurement Officers

a) Update list of Roving Procurement Officer for use of Country offices thatrequire their services

Monitoring Procurement Activitiesa) Tracking all contract that are in excess of the Country Offices delegated

procurement authority and which have not acquired CPO approval.

nt is to explain in detail, all the elements of the ACP and provide practical information and guidance to procurement practitioners to assist in


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What kind of cases are reviewed by the ACP ?

1.1 Scope of the Review

ACP reviews cases which relate to the following procurement functions:

a) Proposed contract -

ACP HQ : Reviews all cases exceeding USD 100,000 for Business Units

in HQ and out posted HQ Units Proposed contracts submitted to the Regional ACP valued in

excess of USD 1 Million, Proposed contracts which involve commitments to a Supplier

with respect to a single requisition for a specificproject/purpose, or a series of requisitions relating to the same specificproject/purpose, received and processed in a calendar year beginning January 1and ending December 31 valued at USD 100,000 or more for Business Units in HQand out posted HQ Units

Proposed contracts or series of related contracts, which generate income of USD10,000 or more (i.e., revenue through the sale of proprietary information) in acalendar year for Business Units in HQ and out posted HQ Units

Proposed contracts of any value which could reasonably lead to a series of relatedcontracts the total of which may be USD 100,000 or more for Business Units in HQand out posted HQ Units

Proposed contracts valued at USD 30,000 or more to be awarded under FinancialRule 121.05 (exception to competitive process), including those cases where thenumber of responsive offers is less than three for Business Units in HQ and outposted HQ Units

Regional ACPs : Reviews all cases exceeding USD 100,000 and upto USD 1

Million for all Country Offices in their respective regions Proposed contracts which involve commitments to a Supplier

with respect to a single requisition for a specificproject/purpose, or a series of requisitions relating to thesame specific project/purpose, received and processed in a

1Advisory Committee on Procurement(ACP)


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calendar year beginning January 1 and ending December 31 valued at USD100,000 or more

Proposed contracts or series of related contracts, which generate income of USD10,000 or more (i.e., revenue through the sale of proprietary information) in acalendar year.

Proposed contracts submitted to the Regional ACP valued in excess of the RegionalCPOs delegated approval authority

Proposed contracts of any value which could reasonably lead to a series of relatedcontracts the total of which may be USD 100,000 or more;

Proposed contracts valued at USD 30,000 or more to be awarded under FinancialRule 121.05 (exception to competitive process), including those cases where thenumber of responsive offers is less than three.

b) Amendment - Amendment, modification or renewal of a contract previously reviewed

by the ACP, where the contract amendment or a series of amendments in the aggregate either increases the total contractamount by 20 percent or more, or valued at USD 100,000, whicheveris less.

Amendment, modification or renewal of a contract not previouslysubmitted to the ACP, where the revised total contract amount is valued at USD100,000 or more.

c) Disposal and write-off of Assets Cases that lead to the disposal, write-off or transfer of goods and/or

property with an asset value USD 30,000 or more Disposal by sale or donation of supplies, equipment or other property

which are in surplus to the operating requirements of the CountryOffice or unserviceable through obsolescence or normal wear and tear

Write-off of equipment, supplies and other property lost, damaged or stolen Disposal of project equipment, including equipment obtained for NEX projects for

which title of ownership is still maintained by UNDP All vehicle accidents involving UNDP and project vehicles where gross negligence is

not the cause

d) Individual contractor - Procurement of services as related to individual consultants (i.e. SSA,

SC, RLA) in a contract amount valued at USD 100,000 or more or inaggregate exceeding USD 100,000 or more

e) Ex-Ante Review To mitigate UNDP risks, ACP in cooperation with subject

expert, Legal Support Office and Procurement SupportOffice, reviews all cases which are complex and exceedscontract amounts of USD 1 million . As an outcome, theCommittee provides a Procurement Roadmap. This is not amandatory review. This approach helps in assessing therisks and developing the procurement road map to mitigate


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ACP/RACP Secretary

red information has been provided by the Requestor for ACP reviewestor, records the correspondence on ACP Online System. In such a situation, ACP Secretariat will send thep the members arrive at a decision (quality control prior to ACP Meeting)do ACP Secretariat by Friday 3pm (EST) for the following ACP Meeting scheduled for Wednesday

r ACP Meetingoff by all the Members in each meetingndividuals and Entities with Association to Terrorist Organizations nor in the List of Vendors Suspended o

nd that were sent back to the Requestor for additional information


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ACP/RACPMemberviewing assigned submissions online in advance and participating actively in the dialogue during the meeti

vity and confidentiality in the course of reviewing the case and giving recommendations

urement action is in accordance with UNDP Financial Regulations and Rules, procedures and instructionsess to ensure that it is fair, competitive, transparent and provides the best value for moneyl implications of the proposed contractincluding the environmental impact

fer is being sought for disposal of goods, where applicable . For detailed guidelines please refer UNDP Asse

that there is no negligence. Ensuring that appropriate funds are available to cover the cost of the proposer the ACP Meeting to the ACP Secretariatis a conflict of interestng per month


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ACP/RACPChair

les and mitigating UNDP risks as far as possible ;

lity control and risk mitigation throughout the process

ed decision making process during the ACP Meeting;t process during ACP Meetingissions, sending ACP recommendation to CPO/RCPO (as the case may be) for approval, rejection or withhol


CPO/RCPOprocurement process

d by ACP

he authority to approve, reject or withhold the proposed contracts that have been submitted to ACP. The

1.1ACP Review Cycle All cases to be reviewed by the ACP should be submitted through the ACP Online

website ( http://acp-online.undp.org ) . Country Offices/Business Units shouldcreate their submission in the corresponding regions where they are situated. TheACP Online, covers ACP HQ, RBA, RBAP, RBAS, RBEC and RBLAC.

The Regional CPOs have been given a delegation of USD 1 Million. All cases abovethis amount should be submitted in the respective regions in ACP Online and afterreview of the case by the RACP Chair, the case would be escalated to ACP HQ.


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CPO reviews the ACP recommendationsand Approves/Withholds/ Rejects the

case. The CPO action is done byWednesday.

Based on the ACP recommendations, the Chairforwards the case to t he CPO fo r Approval/

Withholding/ Rejection. The Chair forwards thecase to the CPO by Monday .

ACP Members review therecommendations and they canadd their comments online or viaemail by Friday.

ACP Secretary uploads the ACPrecommendations on ACP online byThursday .

ACP Members review the notes andprepare for the ACP Meeting onWednesday. ACP Meeting takesplace every Wednesday at 1pm.

SECRETARIATACP MEMBERACP MEETINGACP MEMBERCPOREQUESTORACP Secretary prepares the review notes (casesummary) and sends it to the ACP Members byMonday .

Requestor submits the case to ACPSecretariat by Friday, 3pm EST .


Additional information on the Regional ACPs and Increased Delegation of Procurement Authority is available at the ACP website

(http://practices.undp.org/management/acp )

1.4 Types of ACP Review ACP ReviewAll procurement contracts valued in excess of delegated Procurement authority, usuallyUSD 100,000 require a ACP review. The case is submitted to the ACP online, assignedto a ACP meeting and goes through the entire ACP review cycle. The review andcomments are provided to the CO by 8 working days, if all the required documentationis provided to the ACP in a comprehensive and timely manner.

Direct Review To expedite the Procurement process for contracts on a exceptional basis (i.e. crisis oremergency procurement situations ), valued at USD 100,000 or more, the approval of the CPO can be sought directly without prior review of the ACP. During a direct review,the case is reviewed by the Chair of the ACP and recommendations are sent to the CPOfor action.

ACP CHAIR

Emergency due to Poor Planning cannot be classified as EXIGENCY


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1.1Types of submission to the ACP

What are the types of cases that can be submitted to theACP for review ?

The Competitive Process submissions refers to the cases thatare a result of a competitive bidding exercise undertaken by theCountry Office/ Business Unit by using the RFQ/ITB/RFPsolicitation process.

If the competitive process resulted in a minimum of 3 technicallyresponsive offers then the threshold of USD 100,000 or increaseddelegation would apply. However, if the competitive processresults in less than 3 bids, then it is considered a technical waiverand thus the threshold of USD 30,000 would apply irrespective of the increased delegations received by the procuring office.

The Direct Contracting submission refers to cases where theproposed contractor was selected without undergoing a competitivebidding process. In the case of direct contracting, a threshold of USD30,000 applies to all requesting units/Country Offices irrespective of their increased delegation thresholds.

Direct Contracting may be used only under a limited number of exceptional circumstancesas allowed under UNDP Financial Rules 121.05 (a). When seeking a Direct Contract,

justification must be provided describing the reasons which make it impossible toundertake a standard competitive bidding exercise.Whenever a Direct Contracting method is used, it remainsnecessary for the directly selected supplier/service provider to

submit a proposal in accordance with the established specifications or TOR. Submitteddocumentation must be reviewed by a qualified bid review panel organized in accordancewith UNDP policy.

Refer to the ACP Submission Checklist for detailed list of documents/information to beprovided to the ACP.

POST-FACTO

COMPETITIVE PROCESS

DIRECT CONTRACTING


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The use of post facto submission is greatly discouraged as it is an indicator of a flawedprocess. Prior clearance has to be taken from the Regional Director before a requestingunit can submit a post facto submission to the ACP.

Post facto submissions should be done onlyin emergency/crisis situation, wherecurative operations needs to be undertakento diminish the risk to health or life throughemergency interventions, deployment of apeace keeping or humanitarian supportfollowed by recovery , rehabilitation ,reconstruction and development. In such

situations with a need for quick action and immediate results,deviations from normal procurement rules may be permitted.

The ACP Submission should include the performance report of the Supplier, the approvalfrom the Regional Director, CAP minutes, Evaluation Reports and documents which clearlyindicate the process undertaken to source the Supplier.

The purpose of Ex-Ante submissions is to obtain upfront approvalfrom the CPO on the Procurement Road map for all significantprocurement to be undertaken by the Business unit (BU).Additionally it minimizes the chances of rejection during an ACPreview. However, Ex-Ante is not mandatory and is entirely at thediscretion of the Country Office/Business Unit.

Significant procurement includes :

i. Procurement contract above USD 1 Millionii. Categories of supplies/services which represent the

majority of the BUs spendingiii. Complex in terms of their demand or characteristicsiv. Individually have a significant impact on BUs operations

The business units can seek the advice of the Procurement Support Office (PSO) in draftingthe Procurement Road Map and submit the case for review and approval of the ACPthrough the ACP Online website. Upon submission, the case is reviewed by the ACPMembers, PSO, Legal Support Office (LSO) and External experts (where required ) andfinalized for the CPOs decision based on :

Risk Identification & Mitigation Measures Quality Assurance

Compliance with policies and procedures Contract Management

EX-ANTE : PROCUREMENT ROAD MAP

CONSULTANCY FEE APPROVAL


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ACP/ LEARNINGGUIDE

Background

se provide the following information :

T ID & TITLEnting Partnerbjectives

e/ScopeProject Outcome

h the link between Project & Proposed ContractorResults

he background information should be concise and should briefly describe all the information requeste

Amendmentsriation in Budget, Change in Scope of Works/TOR)

rovide information on all previous Contracts awarded to the Contractor. The dates and amounts of all

Like the saying goes The Devil is in the details . Small things inplans and schemes that are often overlooked can cause a seriousproblem later on.

This section of the SOP walks you through ways of preparing a goodACP submission.

What am I supposed to write under each section of the ACPSubmission?Please note that reference to each section of the ACP submission is for general guidance and thenumbering system need not conform with the numbering system in the ACP Online.

2ACP Submission A walk through


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ACP/ LEARNINGGUIDE

Purpose of Contract/Amendmentfrom the Contractor. Attach a detailed TOR which clearly outlines deliverables and outputsods with technical specifications and quantity for each item and the INCOTERM used for the quotation.Contractor. Attach a detailed TOR which clearly outlines deliverables and outputsdertaken for each location. Attach detailed drawings, technical specifications and BOQ) for each civil works

Competitive Bidding/Proposal

Processuld be tabulated with each action linked to a time frame. The table must clearly identify each component o

):

hdrawal:

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ACP/ LEARNINGGUIDE

Evaluation of Bids/ Proposals


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Risk Managementt and involves a systematic identification, analysis, treatment and where appropriate, acceptance of the risstages of the procurement chain :

ble, user acceptability, integrity and competence

ter then USD 1 Million or complex services or civil works must have a risk assessment matrix w

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ACP/ LEARNINGGUIDE What does a Risk Assessment Matrix looks like ?

This Risk Assessment Matrix below is meant to serve as a sample only and depending upon thecomplexity of the procurement, it may be further elaborated upon by the Business Unit. One of the typical example of civil works is listed below :

Risk Factor Mitigation Measure

Limited competition due to securityconditions in XXX (country)

Widespread advertisement with regionalcoverage in two rounds seeking EOIs.

Incomplete Bill of Quantities (BOQs) andscope of work

BOQs were prepared by one qualifiedQuantity Surveyor (QS) and verified byanother QS prior to bidding, with priceestimation

High value and quality of works withcompressed construction schedule

Used appropriate contractors through pre-qualification exercise

Unclear documentation and/or proceduresto new contractors

Arranged a pre-bid conference to clarify allaspects

Total value of contract(s) in single ormultiple packages exceeds the total limitson the capacity of the selected contractoras stipulated in the pre-qualificationassessment;

Total aggregate value of awards kept belowthe limits on capacity;Verification of capacity through pos-qualification exercise;

Contractor running out of resourcesduring the execution of works

Mobilization advance and monthlypayments


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ACP/ LEARNINGGUIDE

permissible reasons for direct contracting. The Business Unit need to select an appropriate reason and pro

vely within the past 12 months and the prices and conditions offered remain competitive.n a reasonable prior period.property.

cannot be objectively evaluated

Non-compliance with specifications andscope of work

Close monitoring and supervision UNDPsOwners Engineer shall verify the quality andquantity of work included each of thecontractors invoices.

Contractor breaching on performanceobligations

Performance security

Delay in completion Liquidated damages

Variation orders Contingency in the budgetAll works in the hands of one contractor Limit on capacity and spread the works

Handling of transportation and materials Responsibility of the contractor

O N T H E D R A W I N G B O A R D

The current v ersion of the ACP Online, does not have a different section for Risk Assessment.

The ACP Online would be updated at a later stage to include a dedicated section for RiskManagement. Meanwhile, the Business Unit should provide the Risk Management Matrix under the Quality Assurance section

Direct Contracting


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GUIDE

Permissible DirectContracting

Example of Acceptable Justification

No competitive market forperformance or price isavailable

Where a monopoly exists; where fixed pricing by nationallegislation is in effect at the time of the procurement; orwhere the requirements involve proprietary product orservice.

Where there are only two players in the market, it is nolonger a monopoly and comparison between the twosuppliers/service providers should still be established.

Where fixed pricing is in effect, evidence of suchlegislation should be documented.When proprietary product or service is being procured, itmust be established why other equivalent non-proprietary product or service will not meet therequirement.

Determination or need forstandardization

Compatibility and consistency with existing equipment orsystems requires a specific brand of equipment ortechnology; any change in these standards will have adirect financial impact or other adverse consequences for

the end users or the

A cooperative agreementexists between the supplierand a UN entity

A UN long term agreement exists and UNDP hopes toutilize the existing agreement.

Offers for identicalrequirements have beenobtained competitivelywithin the past 12 monthsand the prices andconditions offered remaincompetitive

Prices of goods obtained within the last year following acompetitive exercise remain valid.

The proposed procurement

contract for the purpose of purchasing or leasingproperty

Selection of location is based on security concerns

Genuine exigency for therequirement exists

This includes requirements during times of naturaldisaster, health epidemic, or sudden unforeseen crisis.

Genuine exigency must refer to goods or services forwhich any slight delay will result in the imminent loss orendangerment of human lives or the excessive damage

Justification for Direct Contracting


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A) CHECKLIST FOR GOODS

Detailed Technical SpecificationsShort listing/ Pre-qualificationCopy of RFQ (less than =100,000)Copy of AdvertisementBids Registration recordBid Receipt RecordBid Opening RecordEvaluation ReportPre-Bid Meeting Attendance SheetPre-Bid Meeting Minutes with clarification on the Questions raised by the Vendors (if meeting was done)

Copy of all responsive bids Technical Evaluation ReportFinancial Proposals of all technically qualified bidsFully Signed CAP Minutes & Declaration of Impartiality & ConfidentialityCompany Profile of FirmQuality AssuranceProcurement Plan, if availableRequest from Government requesting UNDP to undertake those activities (if NEX)Project DocumentAnnual Workplan , Results & Resources Framework (RRF)In case of Amendment, Copies of all Previous Contracts

B) CHECKLIST FOR SERVICES

Terms of Reference (TOR)Request for Quotation or Request for Proposal (Including Evaluation Criteria )Shortlisting/ Pre-QualificationCopy of Advertisement, with dates and mediaBid Registration RecordBid Receipt Record

Pre-Bid Meeting Attendance SheetPre-Bid Meeting Minutes withclarification on the Questions

raised by the Vendors (if meeting was done) Technical Bid Opening Record Technical Evaluation Report with detailed scores and narrative of the comparativeanalysis of the ProposalsDeclaration of Impartiality and Confidentiality signed off by all the Evaluation panelmembersFinancial ProposalsCompany Profile of FirmFully Signed CAP Minutes


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Technical Evaluation ReportFinancial ProposalsCompany Profile of FirmFully Signed CAP Minutes

Justification for the Direct ContractingValue for Money AssessmentQuality AssuranceCopies of Contracts with other UN Agencies (if any)Copies of previous Contracts with UNDPProject Document (if the Contractor has been previously identified in the ProjectDocument)Workplan (for Services/SSAs/RLAs)If previously work for UNDP/UN Agencies, then attach copies of Project/SupplierAssessment Report signed off by the Supervising UnitFinancial Proposals of all technically qualified bids

F) CHECKLIST FOR ASSETS WRITE-OFF CASES

RADT formIf it is a case of Transfer to Government/Implementing Partner,attach copy of Project DocumentIf it is a case of loss or theft, attach Police Report / Report fromthe Assets Management Focal Point. Also include sworn statementfrom the custodian of the asset, narrating his/her version of thestory, in addition to the Police investigation report.If it is a case for write off due to expiry of maximum lifespan as specified in theAssets Management guide, then attach copy of certified inventory record includingpurchase price and year of purchaseCAP Minutes

3.1Quality Assurance Checklist

Is the quality of the goods/services assured ?


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A) CONTRACTING OF NGO/ FIRMS

Regular Monitoring of Projects. Submission of Project Assessment of past contractswhen requesting for new extensions.Milestone payment linked to satisfactory deliverable certified by UNDP and advancemade to the NGOs should be based on cash flow projections for the period coveredby the advanceMonitoring & Evaluation strategy to be used by the requesting unitProvide Company profile and CVs of ConsultantsFor firms/NGOs that have previously worked with UNDP, provide project assessmentreport that demonstrates satisfactory performance. Refer templates for capacityassessment of NGOs provided in the UNDP Results Management Guide.Complete breakdown of cost should be provided in the Financial Proposal includingNGO overhead cost.

B) PROCUREMENT OF GOODS

After sales services & warranties.Procurement from Authorized dealers and distributorsPrice comparable to goods under UNDP LTAGoods meets quality assurance standards for products. For eg. ISO 9000

C) FOR LEASE OF PREMISES

Security Assessment Report from UNDSS/ UNDP Security Office ; orMOSS Compliance report cleared by UNDSS at the Country Level.

D) FOR CIVIL WORKS CONTRACTS

The Contract should include a) defects liability period of at least 12 months ; b)performance guarantee for a minimum of 6 months from final completion andvalued at 5% of the contract price.Abstract of Cost certified by Engineer/ ConsultantDetailed Bill of Quantities & Technical SpecificationsBOQ of the Contractor should be certified by an independent Engineer/ ConsultancyfirmAll Invoices have to be certified by the Engineer at the site before disbursement of payments.


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ACP/ LEARNINGGUIDE

SC Service Contract

SOP Standard Operating Practices

SSA Special Services Agreement

TOR Terms of Reference

United Nations Development ProgrammeAdvisory Committee on ProcurementBureau of Management (BOM)

sop dec 2009 version

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