Im t. Audit Report of JACPA Capacity Building Project IDF Grant # TF Jordan Association of Certified Public Accountants

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1 Audit Report of JACPA Capacity Building Project DF Grant # TF Jordan Association of Certified Public Accountants Amman - Jordan for the period 1 Jan 2014 to 31 July 2015 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Q m t

2 TABLE OF CONTENTS. Auditor Report. Statement of Cash Receipts & Payments by Category. V. Notes to the Financial Statement Management Letter 2

3 Qazzcaz Jfp NDEPENDENT AUDTOR REPORT To Jordan Association of Certified Public Accountants Amman, Jordan We have audited the accompanying special purpose project financial statement comprising of the statement of Cash Receipts and Payments of JACPA Capacity Building Project - DF Grant # TF11789 for the period 1 Jan 2014 to 31 July 2015, and the explanatory notes for the period then ended. Management's Responsibility: Management of the project is responsible for the preparation and fair presentation of this statement n accordance with interational public sector accounting standards, and for such internal conrols as management determines is necessary to enable the preparation of financial statements that are free from material misstatement. whether due to fraud or error. Auditor's Responsibility: Our responsibility is to express an opinion on this financial statement based on our audit. We conducted our audit in accordance w ith nternational Standards on Auditing. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and about whether JACPA Capacity Building project has complied with the laws, regulations, guidelines and provisions governed by the Grant Agreement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement. An audit also includes assessing the accounting principles used, as well as evaluating the overall financial statement presentation. We believe that our audit provide a reasonable basis for our opinion. Our opinion: (a) The general purpose project financial statement presents fairly, in all material respects, the cash receipts and payments of the Project for the period 1 Jan 2014 to 31 July 2015 in accordance with the nternational Public Sector Accounting Standards, under the cash basis of accounting; (b) nternal control over financial reporting invol ed in the preparation of replenishments, direct payments and reimbursement can be relied upon to support the related withdrawals for the period (c) The project was in all material respects in compliance with laws, regulations, guidelines and provisions governed by the Grant agreement Other matters This report is intended solely for the information and use of World Bank, the Government of Jordan. Jordan Association of Certified Public Accountants and the related project management. Mohammad Qazzaz License # August 2015 S azzaz O o. Swefieh, Yagoub Mu'ammar Str. P.O. Box 8500'7 Amnman. 11'.85 Jordan Phone: Fax:

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5 JACPA Capacity Building Project World Bank DF Grant No. TF Jordan Association of Certified Public Accountants Amman - Jordan Notes to the Financial Statements as of 31 July General Background Grant Amount: USD 250,000 Agreement Date: 8 March 2012 Closing Date: 21 March 2015 The Jordan Association of Certified Public Accountants (JACPA) is the legal body that has financial and administrative independence and carries out a wide range of activities that include provision of sen4ces to its members. supporting scientific and professional research, contributing to the development of training programs for the purpose of increasing the competency of its members, cooperating and coordinating with various associations and international, regional and national professional and academic bodies. JACPA also act as as a syndicate to protect the interests of the public accountants. JACPA has received a grant from the ) 'orld Bank (WB) nstitutional Development Fund (DF) of up to USD The objective of the grant is to strengthen JACPA's capacity to provide outsourcing sen-ces in accounting and financial reporting. Eligible expenditures that may be financed out of the proceeds of the grant and the allocation of the amounts to each Category and the percentage of e-xpenditures to be financed are specified in the following table: Amount of Grant Percentage of Category Allocated Expenditures to be Financed USD (inclusive of Taxes) 1. Consultants' Seri-ices and audit 148, % 2. Training 75, % 3. Goods 26, % TOTAL AMOUNT 250,000 The project consists of the following parts (component) - Part A:. Designing a strategy to strengthen JACPA's outsourcing capacity in accounting and reporting. Part B: Assessing the training needs, developing training plan and programs. 5

6 Part C: Selecting, training, and utilization of master-trainers by JACPA. Part D: Management and audit of the project. JACPA established a project management unit (PMU) in order to manage the implementation of the project and for the purpose of implementation of the grant agreement in accordance with the grant stipulations and WB disbursement and procurement guidelines. such PMU comprises of the project manager and 2 members of the JACPA, such is assisted by the accounting function that serve JACPA in general. 2. Summary of Significant Accounting Policies Basis of Accounting & Reporting: The JACPA followed and maintained its accounts under Cash Basis of Accounting in recording the transactions; accordingly JACPA recognizes funds when received and expenditures when occurred. As for reporting of this grant JACPA reports the project operations in accordance with nternational Public Sector Accounting Standards, under the cash basis of accounting. Translation of currencies: Functional currency for the project operations is Jordanian Dinars (JOD) and translated into United States Dollars (USD) at the prevailing exchange rate of LSD 1 = JOD.708, and maintains the accounts in JOD. The project also reports all transactions in USD. 3. Designated Account As per the grant agreement; the Jordan Association of Certified Public Accountants opened a Designated Account with the Arab Jordan nvestment Bank. Project Special Account Number is in USD with an initial deposit from the World Bank of USD 60,000, this account is feeding a zero balance sub-account of in JOD to cover payments made in local currenc). JACPA maintained this Designated Account and its sub-account for the grant payments and replenishments (using Withdrawal Applications) exclusively. nitial Deposit: nitial Deposit from the World Bank of USD 60,000 w as transferred to the Designated Account in July 'B Replenishments During the period the World Bank replenished the Designated Account with 5 replenishments with the total of LSD 69,175 Disbursements: The Designated Account summary of transactions during the period is illustrated below in USD: 6

7 Beginning Balance 37,851 Add: World Bank Replenishments Deduct: Payments for Expenditures 107,015 Ending Balance Uses of grant funds per part (component): During the period expenses made are illustrated below in LUSD Part A Strategy 100,500 Part B Training 32,361 Part C Master Trainers 59,792 Part D Management & Audit 5,882 Total Expenditures 198, Contract Listing The Status of signed contracts under the grant is illustrated in the folluwing table in USD as of 31 July 2015: 7

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10 "Report on Accounting Procedures & nternal Control" JACPA Capacity Building Project World Bank DF Grant No. TF

11 Qctzzctz JPoJ. Jordan Association of Certified Public Accountants JACPA Capacity Building Project World Bank DF Grant No. TF11789 Amman, Jordan The accompanying memorandum includes suggestions for improvement of accounting procedures and internal controls that came to our attention as a result of our audit of the financial statement of JACAPA Capacity Building project - World Bank Grant No. TF for the period 1 Jan 2014 to 31 July n accordance with international standards on auditing, we performed a study and evaluation of existing internal controls for the purpose of providing a basis for reliance thereon in determining the nature, timing and extent of the audit tests applied in connection with our audit of the project financial statement. Nothing comes to our attention during the course of conducting the annual audit exercise that requires us to report on with regard to the project internal controls. The memorandum is intended solely for the use of project management and the World Bank and is not intended for any other purpose. Finally we wish to express our appreciation for the courtesies and cooperation extended to our representatives during the course of their work. Very truly yours Mohammad Qazzaz 3 August 2015 Swefieh, Yaqoub Mu'ammar Str PO Box Amman Jordan Phone: Fax r P

12 Report on Accounting Procedures, nternal Control Structure: As per our review we noted no material findings 12

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