The Impact of Accounting Systems on Project Funds Absorption Capacity, Case Study of Agricultural Research Projects in Rwanda

9804 words 40 pages
The Impact of Accounting Systems on Project Funds Absorption Capacity
Case study of agricultural research projects in Rwanda
Maastricht, September 2008
This paper was written in the framework of an MBA thesis at the Maastricht School of Management (MSM) under the supervision of Prof Eno L. Inanga


The absorption capacity is one of key indicators on which financing agencies base the allocation of financial resources to sponsored projects, and should hence be closely monitored. Its level was reported to be low in developing countries, according to studies conducted by the World Bank, the OECD and ODI. However these studies focused on macroeconomic indicators and less on developing measurements of
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FARA works in close collaboration with subregional research organisations (SROs), currently four (ASARECA, SADEC/FANR, CORAF/WECARD and North Africa SRO), which in turn use the national agricultural research systems (NARS), i.e. national agricultural research institutes (NARI) , universities and other partners such as farmer organisations, NGOs, etc. to reach the final beneficiary, the farmer. International agricultural research financing transits partially through this channel, which uses competivive grant systems (CGS) to allocate funds to research projects in different countries.
Agricultural research in rwanda
Importance of agriculture to the Rwandan economy
Agriculture bears high importance for Rwanda, a central African small country, with only 26,338 Km2 surface area, landlocked at 2 00 S, 30 00 E. Rwanda is distant from the ocean by 1,700 Km from the Indian Ocean, at least 2,200Km from the Atlantic Ocean, and at midway of the distance between Cape Town and Cairo; long of 7,400 Km (Rwanda Gateway, 2008). With no significant natural resources, currently the country’s economy relies on agriculture, which contributes around 40% of its GDP, with coffee and tea alone


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