From an early stage we have had the ambition to connect AidHedge to IATI. For some time now we have explored how to do this technically, and also what it will help us to do. The analyses that are possible would be really powerful. It would enable us to provide our tool to thousands of aid-projects directly. And also do some other really amazing stuff as well, like to visualise financial risk in aid to an entire country or sector. Or see the actual outcome of all those currency transactions aggregated!
IATI has data for thousands of past, present and future aid projects and we hope to (very very soon!) run all that data through AidHedge! Here is a progress report of our work. We will update you as we go along!
Understanding how approach IATI
We have been looking at the IATI standard for a while to understand how we can use the data. Lately we have been hard at work with other things (like new functionality and a new report format). But now it’s time to see if we can’t finalize the connections to IATI.
There are a number of live versions of the IATI data standard. The whole thing is really somewhat a living entity. But that is also one of the thing that makes IATI so interesting to us. There is an ambition that the data should be as up to date as possible, giving a snapshot of all aid activities. As we strive to provide reports that are dynamically updated and relevant, current and correct data is important!
Since our resources are limited we have decided to limit ourselves to just versions above 2.01 at this time. It excludes quite a number of activities, but we hope we can come back and include all versions at a later stage.
Understanding financial transactions (for our needs)
When using the IATI data to build an currency analysis for a project we need to pick out all financial transactions. Using the IATI data has been easy enough. Having worked around with the data a bit, we have learned some initial lessons.
- Understanding perspective: Our current tool bases the analysis on a budget. We calculate how the budget is affected by currency fluctuations. It can be a project or organisational budget. As IATI is open to a wide number of reporting organisations, the perspective of reported data varies. It might be a donor reporting funds it distributes to partner organisations, or implementing organisations reporting both incoming funds and project costs. To make sure our analysis captures both donor funds and project costs where possible, we need to untangle the data. Basically we need to decide on the relevant budget for our analysis. It has however turned out to be, well, not all that straightforward. So far we are working on an alogorithm building on a combination on who-is-who in the activity and the types of transactions. But we have started looking at other ways of handling the data (see for example 1, 2, 3) and we may still find a better strategy.
- The next step is to get the correct currency data for each financial transaction. To understand the exposure towards currency transaction costs and risks we need data about all involved currencies. What are you holding, and what are you exchanging into? As this is not included in IATI we are trying out a solution where we use a combination of the transaction data and other data from IATI. We will also have to make some assumptions, which are not at all exact — but it’s a start at least! This is something we will expand upon as it develops.
Data quality (from our perspective)
We have also learned something about the varying quality of current data. IATI does a lot of benchmarks, and there is the index as well. But we have seen that for our use, there measurements are not always reflecting importance. For example, Sida has overall really good ratings on its data. But we have concluded that the Agency reports its data in the incorrect currency, with an incorrect number of transactions and with incorrect transaction dates. Which is quite a pickle when you are trying to create a practical application based on exactly that data..!
We hope to be able to show you some first results soon! If you are interested in this, have some experience working with IATI or just have questions or comments — get in touch!
