OFFICE OF THE. .qa I En3Iw-< (#TI -1 11, ACCOUNTANT GENERAL (AUDIT) -1. Tz1 J MAHARASHTRA, NAGPUR. Dy. Accountant General(E.S)

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized To OFFICE OF THE.qA I En3Iw-< (#TI -1 11, ACCOUNTANT GENERAL (AUDIT) -1 Tz1 J MAHARASHTRA, NAGPUR 'TqThf T ',WT 0# 3 220, ift [ F, 'Audit Bhavan', Post Bag No. 220, Civil Lines, Nagpur VIV ltelephone* to Website: ' /W I Fax: The Project Director, Maharashtra Agriculture Competitiveness Project, Deptt. of Co-operation and Marketing, Project Co-ordination Unit, Plot No. F/E/78, 1st Floor, LDB Training Centre Building, Market Yard, Gultekadi, Pune Subject: Madam, E- mail :agaumaharashtra2@cag.gov.in CASS-III/AC/MACP/ / 10 Dated: ic October 2016 Audit Certificate in respect of World Bank assisted Maharashtra Agriculture Competitiveness Project (MACP) Cr. No IN for the year Please find enclosed Audit Certificate along with Annexure-A, Annxure-B, Annexure-C, Work abstract and Management Letter in respect of World Bank assisted Maharashtra Agriculture Competitiveness Project (MACP) Loan No.4809-IN for the year for further necessary action at your end. Public Disclosure Authorized M.yAoarasuatra AgricuGturer AA1~ IWN o. 21 ZThSSr. tc p Li t Yours faithfully, Dy. Accountant General(E.S)

2 <bz4 0q OFFICE OF THE 1itq1si3 (Iv Iwml)-II, ACCOUNTANT GENERAL (AUDIT)-II 1, MAHARASHTRA, NAGPUR '9Tif FZ1 rfiw 4t W. 220, RTiF 7il, TTTF 'Audit Bhavan', Post Bag No. 220, Civi Lines, Nagpur STVIV / Telephone to Website: 0fW I Fax: E- mail : agaumaharashtra2@cag.gov.in Report on the Project financial Statements We have audited the accompanying financial statements of the Maharashtra Agriculture Competitiveness Project, (financed under World Bank Credit No IN), which comprise the Statement of Source and Applications of Funds and the Reconciliation of Claims to Total Applications of Funds for the year ended 3 1t March These statements are the responsibility of the Project's management. Our responsibility is to express an opinion on the accompanying financial statements based on our audit. We conducted our audit in accordance with the Auditing Standards promulgated by the Comptroller and Auditor General of India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Our audit examines, on a test basis, evidence supporting the amounts, and disclosures in the financial statements. It also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements present fairly, in all material respects, the Sources and Applications of Funds of Maharashtra Agriculture Competitiveness Project., Credit No IN for the year ended 31" March, 2015, in accordance with Government of India Accounting Standards. In addition, in our opinion, (a) with respect to SOEs, adequate supporting documentation has been maintained to support claims to the World Bank for reimbursements of expenditures incurred; and (b) except for ineligible expenditures as detailed in the audit observations, if any, appended to this audit report, expenditures are eligible for financing under the Loan / Credit Agreement (Credit No IN). During the course of the audit, SOEs/PFS for Z.22,56,84,867/- (Rupees Twenty two crore fifty six lakh eighty four thousand eight hundred and sixty seven only) and the connected documents were examined and these can be relied upon to support reimbursement under the Loan / Credit Agreement (Annexure A). (Amount objected Z. 16,43,321/-(Rupees Sixteen lakh forty three thousand three hundred and twenty one only) as shown in Annexure-B). This report is issued without prejudice to Comptroller and Auditor General's right to incorporate the audit observations in the Report of Comptroller and Auditor General of India for being laid before Parliament / State or UT Legislature. Date: AASTHA LUTHRA Sr. Deputy Accountant General (E.S.)

3 Annexure 'A' Audit jurisdiction-wise Expenditure incurred during the year in respect of World Bank Assisted Maharashtra Agricultural Competitiveness Project (Financed under World Bank Loan No IN) Sr. Name of the Office Amount of expenditure incurred on the No. Pro ect as per SOE/PFS 01 Office of the Pr. Accountant General, 0 15,65,46,661/- ( Rupees Fifteen crore (Audit)-I, Maharashtra, Mumbai. sixty five lakh forty six thousand six hundred and sixty one only.) 02 Office of the Accountant General, Z. 6,91,38,206/- (Rupees Six crore ninty (Audit)-II, Maharashtra, Nagpur one lakh thirty eight thousand two hundred and six only) Total Z. 22,56,84,867/- (Rupees Twenty two crore fifty six lakh eighty four thousand eight hundred and sixty seven only ) Sr. Audit Officer/CASS-1II

4 Annexure 'B' Details of amount held under objection on account of money value paras as a result of local audit in respect of World Bank Assisted Maharashtra Agricultural Competitiveness Project (Financed under World Bank Loan No IN) for the year Sr. Name of the Office Para Nature of objection Amount objected No. No. (in Z.) 01 Office of the Pr. 2 Incorrect depiction of grants from 6,70,869/- Accountant General, Government and eligible expenditure (Audit)-I, in PFS (DDRCS) Maharashtra, Mumbai. 4 Incorrect accountal of expenditure- 1,65,191/- Economic Sector amount not utilized 02 Office of the 1 Unutilised grant (The Divisional 3,67,000/- Accountant General Jt.Dir, of Agriculture, Aurangabad) (Audit)-II, Maharashtra, Nagpur Economic Sector 1 Non-crediting of interest to APMC 2,10,394/- account (DDRCS, Amravati) 1 Pending interest on MACP Scheme 4,299/- (DDRCS, Chandrapur) 1 Excess expenditure incurred on 8,750/- stationery, advertisement and study tour (DDC, AHD, Amravati) 2 Non credit of Bank interest earned 4,568/- (DDC, AHD, Amravati) 1 Unutilisation grant (DDC, AHD, 52,500/- Beed) 1 Non Production of voucher (DDC, 1,27,500/- AHD, Washim) 1 Excess expenditure incurred on 32,250/- stationery and advertisement (DC, AHD, Yavatmal) Total /- (Rupees Sixteen lakh forty three thousand three hundred and twenty one only) Sr.Audit Officer/CASS-III

5 Annexure 'C' Details of inadmissible amounts of earlier years Certification held admissible on compliance during current audit in respect of World Bank assisted Maharashtra Agriculture Competitiveness Project, Credit No IN Period Mumbai Jurisdiction Sr. No. Name of the Implementing Year Para Amount Agency No. (in Rs.) DDRCS Ahmednagar (A) (B) DDC-AHD Pune DDRCS Jalgaon Total Nagpur jurisdiction Sr. No. Name of the Implementing Year Para Amount Agency No. (in Rs.) 1 DDRCS, Akola ,749/- 2 DDRCS, Aurangabad ,42,353/- 3 DDRCS, Buldana ,102/- 4 DDRCS, Gondia ,358/- 5 DDRCS, Jalna ,350/- 6 DDRCS, Nagpur ,204/- 7 DDC-AHD, Beed ,500/- 8 DDC-AHD, Nagpur ,000/- Total 5,22,616/- Sr. Audit Officer/CASS-1II

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13 To, Smt. Sampada Mehta (1AS), Project Director, Maharasbtra Agriculture Competitiveness Project, Deptt. of Co-operation and Marketing, Project Co-ordination Unit, Plot No. F/E/78, I't Floor, LDB Training Centre Building, Market Yard, Gultekadi, Pune CASS (W&F) / M.L. MACP / Dated October, 2016 Subject: Management letter on the issues observed during the audit of World Bank assisted Maharashtra Agriculture Competitiveness Project (MACP) (Credit No IN) for the year Madam, Audit of the Statements of Expenditure (SOE) in respect of World Bank Assisted Maharashtra Agricultural Competitiveness Project (Credit No IN) has been conducted for the year As envisaged in the Standardized Terms of References (TORs), the Management letter pointing out the following major observations noticed during the course of audit is prepared for issue along with the Audit Certificate. I. In the following units there were discrepancies in the opening balance of cash book and that shown in the Statement of Sources & Application of Funds (Annexure-20A) Name of the Opening Opening Balance Unit Balance as (01/04/2015) as Remarks per Cash per Statement of Book sources & Application of Funds (Annexure- 20A) DDC-Jalgaon? 15,50, NIL The arnount was received at the fag end of the financial year and expenditure incurred in the year DDC-Dhule Z 1, 12,173/- NIL Expenditure incur-red in the year Project Z 5,24,069/- NIL The amount was received at the fag end of the year

14 Unit, Animal and expenditure Husbandry, incurred in the year Pune Project NIL ( 48,062/- Grants received & Implementation expenditure incurred during Unit, the year was Agriculture Z lakh. Incorrect depiction of opening bank balance resulted in understatement of funds received from Government through budget by Z 0.48 lakh in the Annexure 20A of PFS. 2. Non utilization of grants received in in the same financial year. In the following cases grants received during were utilized in the subsequent year. * DDO of the District Dy. Commissioner of Animal Husbandry, Ahmednagar, received grants of Z 9,36,386/- for the year and expenditure is incurred in the year * DDC-Nasik, received an amount of Z 9,29,744/- on and the expenditure is incurred in the year However, Statement of Sources and Application of Funds (Annexure 20A) of the unit shows that? 9,29,744/- received and expenditure is incurred in the year * DDCAH, Buldhana had claimed an expenditure of t lakh, against the grant received an amount of Z 8.49 lakh during the year Scrutiny of records revealed that out of the total expenditure of Z lakh incurred during the year , an amount of Z lakh pertaining to the year was claimed in SOE of the year Further an expenditure amounting of Rs lakh pertaining to the year was also included in the SOE of the year

15 The unspent amount of Z. 92,989/- was also shown as the expenditure incurred during the year * DDCAH, Yavatmal has booked an expenditure of Z 8.60 lakh during the year against the grant received of? 8.88 lakh. Scrutiny of records (Cash book and vouchers) revealed that the expenditure of Z 7,46,333/- only pertains for the year , however expenditure incurred during the year and were also included in the SOE as shown below: Grants received during the year Z 8,87,500/- Expenditure claimed for in SOE - Z 8,60,841/- Expenditure of included in SOE - Z 31,200/- Expenditure of included in SOE ,308/- Actual expenditure incurred in ? 7,46,333/- 3. Pending utilization certificates. Amount of expenditure booked in Office of the Pr. Accountant General (A&E)-I, Mumbai is Z 15,30,54,400/- and the amount of objection for pending Utilisation Certificates is 2,03,47,939/-. 4. Non conducting of Test for the animals treated in Health Camps. As per instructions contained in the guidelines for implementation of health camp for treatment of animals (Blood /Urine Test), tests are to be conducted in respective Animal Husbandry labs in respect of animals treated in the health camps held under MACP. In DDC, AHD, Yavatmal during the year , five health camps were held in Pusad and an expenditure of Z. 7,37,200/- incurred on medicines/supplements without ensuring the Blood/Urine Tests and verifying the test Report. Yours faithfully, Sr. Dy. Accountant General (ES)