The World Bank used a SWAp in support of Brazil's Family Health Program (PSF). In this Adaptable Program Lending (APL) instrument, bank financing is pooled with federal grant transfers for three programs in the Ministry of Health (MOH) : (i) Basic health Care (AB), (ii) Family Health (PSF) and (iii) PSF Conversion. These pooled funds flow through a National Health Fund, maintained by MOH, to a common bank account at each municipality.

To enable Bank's financial support of the PSF through the existing federal-to-municipal grant system, a special pooling arrangement and innovative fiduciary features were incorporated at the request of the Government.

Brazil's existing financial management and procurement rules and systems were assessed favorably prior to the use of World Bank funds in the pool. However, during the life of the APL, the Bank will work with the federal government to supervise and strengthen municipal fiduciary processes.

A working group comprising of IADB, UNDP and WB, is pursuing further harmonization in procurement procedures.

WB will share with IADB the results of its State-Level Financial Accountability Assessment (SFAA) for two States which is scheduled for completion in June 2004. WB completed a Report on the Observance of Standards and Codes (ROSC) and an update is scheduled for Fall, 2004.

IADB and WB shared audit tools to evaluate Supreme Audit Institutions (SAIs) and audit firms.

IADB and WB are sharing information on loan disbursement systems, policies, and procedures.

IADB and WB are providing guidelines for the Brazilian Electronic Pregao system. In fact, these guidelines represent a joint product of AsDB, IADB and WB in the area of electronic government procurement (eGP) harmonization.