Public Disclosure Authorized (ONH(CM I--\NAtlDIf TIlL.)J\P\ P01.1CN \NI) 111..\lAN R11:4(tl Di \ l I.OPM \L.M GR \km No.T1-011184 I\MPRO\lM\G Il,[ \ l-l.r R[lik ln\i E..!N NIOMGMI. \ PRO.11l CT Pk\R,i B..\I \,\ \GANG" CL.LN kl\i IC IIN Rl Rt-\t IND)EP'ENDEFNT AU1:DITOR'14 R EPO RT I iania satmetsfor thle %ea r fifmledl Nor embier- 25, 20 15 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Ulaanbaatar 2015
CONFIDENCE -AUDIT Auditing, Accounting, Training, Ulaanbaatar city. Chingellci district. 3rd khoroo, Capital center, 10th floor # 1005 Phonc 976-11-322431. rax 976-70119100 Part B. Managing Climatic Risk Disaster Risk Management in E-mail info@confidenceaudit.nn 20oT,?. 104 A!Mongolia Project INDEPENDENT AUDITORS' REPORT We have audited the accompanying balance sheet of "Part B. Managing Climatic Risk in Rural Mongolia of Improving Disaster Risk Management in Mongolia" Project, pursuant to the Grant Agreement (Grant No. TF011184) entered between the International Development Association and Government of Mongolia dated 13 June 2012, as of 25 November 2015 and its statements of source and uses of funds, the statement of expenditures and the special account reconciliation statement for the year then ended. The preparation and presentation of these financial statements are the responsibility of Project management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the International 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating overall financing statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, (A) the financial statements referred above and the disclosures to these financial statements present fairly, in all material respects, the financial position of the "Part B. Managing Climatic Risk in Rural Mongolia of Improving Disaster Risk Management in Mongolia" Project as of 25 November 2015 and the result of operation for the year then ended in accordance with IPSAS; (B) the Borrower has utilized all proceeds of the loan withdrawn from the International Development Association only for purposes of the project as agreed between the International Development Association and the Government of Mongolia in accordance with the Grant Agreement; and no proceeds of the loan have been utilized for other purposes; and (C) the Borrower was in compliance as at the date of the balance sheet of the year of audit with all financial covenants of the Grant Agreement.
In addition: (a) (b) (1) With respect to Statements of Expenditures, adequate supporting documentation has been maintained to support claims to the International Development Association for replenishments of expenditures incurred; and (2) which expenditures are eligible for financing under Grant Agreement No. TFO 11184. (1) The Imprest Account (page 6) give a true and fair view of the receipts collected and payments made during the year ending 25 November 2015; and (2) these receipts and payments support Imprest Account replenishments during the year. AbtMT Ulaanbaatar, Mongolia X1 OefdLffnce-udit" LLC
The Government of Mongolia The Japan Policy and Human Resources Development Grant N2TF01 1184 Improving Disaster Risk Management in Mongolia Part B. Managing Climatic Risk in Rural Mongolia BALANCE SHEET As at November 25, 2015 As at Nov 25, 2015 As at Dec 31, 2014 Note In US Dollars In US Dollars ASSETS Cash and cash equivalents Cash at bank: Designated account 195.34 66,595.15 Operating account MNT 5.02 3,230.32 Total cash and cash equivalents 200.36 69,825.47 Cumulative project expenditures Category 1 for part A of the Project - - Category 2 for part B of the Project 3 666,366.55 217,859.46 Bank charge - - Total cumulative project expenditures 666,366.55 217,859.46 TOTAL ASSETS 666,566.91 287,684.93 FUNDS PHRD Grant 666,366.55 286,489.56 Net interest earned 4 626.40 1,613.24 Net exchange rate gain (loss) (426.04) (417.87) TOTAL FUNDS 666,566.91 287,684.93 Prepared by: Appro by: J.Sukhgere Financial Management Specialist.Vanchin Project Coordinator I C Confidence Audit LLC
The Government of Mongolia The Japan Policy and Human Resources Development Grant X9TFO1 1184 Improving Disaster Risk Management in Mongolia Part B. Managing Climatic Risk in Rural Mongolia SOURCES AND USES OF FUNDS For the year ended November 25, 2015 Current year Previous year Total US Dollars US Dollars US Dollars FUNDS PHRD Grant 429,366.78 305,971.92 735,338.70 Interest earned (986.84) 1,613.24 626.40 Net exchange rate gain (loss) (8.17) (417.87) (426.04) TOTAL FUNDS 428,371.77 307,167.29 735,539.06 USES OF FUNDS Category I for part A of the Project - - - Category 2 for part B of the Project 448,507.09 217,859.46 666,366.55 Bank charge - - - TOTAL USES OF FUNDS 448,507.09 217,859.46 666,366.55 Surplus of funds over uses (20,135.31) 89,307.83 69,172.51 REFUND OF PHRD GRANT 49,489.79 19,482.36 68,972.15 CASH ENDING BALANCE (69,625.10) 69,825.47 200.36 Prepared by: Ap ed by: J.Sukhge Financial Management Specialist s.vanchin Project Coordinator (Confidence L6 pg. Audit LLC
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The Government of Mongolia The Japan Policy and Human Resources Development Grant X2TF0 11184 Improving Disaster Risk Management in Mongolia Part B. Managing Climatic Risk in Rural Mongolia SPECIAL ACCOUNT RECONCILIATION STATEMENT Account number 370000015800, with State bank As at November 25, 2015 In US dollars 1 Total advanced by PHRD 99,999.00 2 Less: Total amount recovered by PHRD 49,489.79 3 Equal present outstanding amount advanced to the special account 50,509.21 4 Balance of special account per attached bank statement as of date 2015/11/25 195.34 5 Total amount credited but not withrawn - 6 Total amount withdrawn WA 8 C but deducted from advance 50,509.21 7 Interest earned (626.40) 8 Bank charge 9 Total advance accounted for 50,078.15 10 Difference between total appearing on lines 3 and 9 431.06 Explanation of any difference between total appearing on lines 3 and 9 All items should be indicated on the bank statement Operating account As at November 25, 2015 5.02 Currency difference 426.04 431.06 Prepared by: Approved by' J.Sukhgle Ts.V chin Financial Management Specialist Project Coordinator C4,Confidence Audt LLC Page....
The Government Of Mongolia The Japan Policy and Human Resources Development Grant Ns4TF0I 1184 Improving Disaster Risk Management in Mongolia NOTES TO THE PROJECT FINANCIAL STATEMENTS For the year ended November 25, 2015 1. Project background The objectives of the Project are to improve the disaster preparedness of Ulaanbaatar and to reduce the impact of "dzud" on rural livelihoods. The Project consists of the following parts: Part A. Managing Urban Disaster Risk in Mongolia A.1. Urban Risk Management and Preparedness in Ulaanbaatar A. 1.1. Carrying out of a detailed disaster risk assessment for Ulaanbaatar, including the mapping of risk areas, the review of existing zoning regulations and land use plans, and the dissemination of information. A. 1.2. Design and development of a database on hazards and vulnerabilities with a GIS system, including demonstration workshops and training for potential users of the database. A.I.3. Design of the Ulaanbaatar Disaster Risk Management Plan, and capacity building for key actors, including design of pilots demonstration works. A.2. Monitoring and Evaluation A.3. Project Management Part B. Managina Climatic Risk in Rural Moneolia B. 1. Dzud Management System B. 1.1. Development of an information system for dzud forecasting and monitoring including carrying out of an initial diagnostic and implementation of recommendation on roles and responsibilities, data collection, and data sharing and consolidation into mapping tools. B. 1.2. Analysis of options and design of a new emergency feed and fodder supply system, including the strengthening of food and fodder production, state procurement, storage and distribution systems, and associated capacity building. B.2. Monitoring and Evaluation B.3. Project Management and Administration Confdence Audft LLC
Project Execution Generally.The Recipient declares its commitment to the objectives of the Project. To this end, the Recipient shall: (a) carry out Part B of the Project through the Sustainable Livelihoods Program Office within the Ministry of Finance in accordance with the provisions of: (i) Article II of the Standard Conditions; (ii) the "Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants", dated October 15, 2006 and revised in January 2011 ("Anti-Corruption Guidelines"); and (iii) this Article II; and (b) cause Part A of the Project to be carried out by the Municipality of Ulaanbaatar (MUB) in accordance with the provisions of: (i) Article II of Standard Conditions; (ii) the Anti-Corruption Guidelines; (iii) this Article II; and (iv) the agreement dated the same date as this Agreement between the World Bank and MUB, as such agreement may be amended from time to time ("Project Agreement"). Eligible expenditures.the recipient may withdraw the proceeds of the grant in accordance with "World Bank Disbursement Guidelines for Projects" dated May 2006, to finance Eligible Expenditures as set in the following table. The table specifies the categories of Eligible Expenditures that may be out of the proceeds of the Grant ("Category"), the allocation of the amounts of the Grant to each category, and the percentage of expenditures to be financed for Eligible Expenditures in each Category: Amount of the Percentage of Category Grant allocated expenditures to be (USD) financed (Inclusive of Taxes) (1) Goods, works, non-consulting services, consultants services, Training and Workshops, and 1,365,000 Management fee under Part A of 100% the Project (2) Goods, works, non-consulting services, consultants services, Training and Workshops, and Operating cost under Part B of 1,365,000 100% the Project Total amount 2,730,000 2. Summary of significant accounting policies a) Statement of compliance The financial monitoring reports comprise the balance sheet, a summary of source and uses of funds, the statement of expenditure and the special account statement. These financial monitoring reports have been prepared in accordance with Financial Monitoring Reports for World Bank financed Projects: Guidelinesfor Borrowers. Confidence Audit LLC
b) Basis of preparation The financial monitoring reports are prepared in accordance with International Public Sector Accounting Standards (IPSASs) issued by the International Public Sector Accounting Standards Board (IPSASB) of the International Federation of Accountants and cash receipts and disbursement basis of accounting has been applied. On this basis, receipts are recognized when received or direct payment to creditors are made rather than when income is earned and disbursements are recognized when paid rather than when expenses are incurred. c) Basis of measurement The financial monitoring reports are presented in U.S.Dollar ('USD'). Cash balances denominated in currencies other than USD are translated into USD at year end rates of exchange stated by the Bank of Mongolia. Transactions denominated in currencies other than USD are translated at rates at the dates of the transaction stated by the depository bank. Any gains and losses are reflected in the statement of sources and uses of funds. d) Basis of presentation The accounts balances in the Financial Monitoring Reports as November 25, 2015 have been presented on December 31, 2014. e) Designated account In according to the Disbursement Letter, the project opened the Designated Account which is one segregated account for the grant financing at the State Bank acceptable to the World Bank. The statement of Designated Account is presented USD. f) Operating account The project unit also maintains the operating account in MNT at State bank. The account is used for operating expenditures. Part B. Managing Climatic Risk in Rural Mongolia Part B of the project is being implemented in "Livestock and Agricultural Marketing" project. LAMP maintain an operating account to facilitate payments related to incremental operating expenses, advances made from Designated Account (DA) to an operating account (OA) that opened at the same commercial bank there the DA is maintained (State bank). Uses of the advances to the OA reported and reconciled with the DA on a monthly basis. The outstanding balance of the OA reported as a separate line item on the DA reconciliation statement that is submitted together with the withdrawal application from the DA. Confidence Audit LLC P.9ff..tJ
The Government of Mongolia The Japan Policy and Human Resources Development Grant XTFO 11184 Improving Disaster Risk Management in Mongolia Part B. Managing Climatic Risk in Rural Mongolia NOTES TO THE PROJECT FINANCIAL STATEMENTS (continued) For the year ended 25 November, 2015 3. Category 2 for part B of the Project The main document of the project state that "Goods, works, non consulting services, consultants' services, Training and Workshop, and operating costs are include category 2." The project has separately accounted Category 2 for part B by following types of expenditures. Note 25-Nov-15 31-Dec-14 Operating fee 3a 50,205.92 45,275.92 Consultant 3b 35,198.31 35,198.31 Training 3c 74,541.07 60,906.10 Consulting fee 3d 105,815.53 76,479.13 Goods 3e 387,790.97 - Non Consultants service 3f 12,814.74 - Total 666,366.55 217,859.46 3a. Operating fee Operating fee have accounted by following as at 25 November, 2015. As at December 31, 2014 45,275.92 Adjustment /Computer equipment/ (2,705.61) Adjustment /Bank charge/ (127.99) As at December 31, 2014 42,442.32 Salaries for support staff 1,932.03 Advertising cost 407.71 Bank charge 196.97 Cost related to laboratory research 248.39 Office cleaning service 590.00 Low-priced fast-depreciable assets 519.16 Office utilities 324.63 Office supply 320.61 Stationary Cost 346.86 Phone call 110.29 Internet service fee for PIU office 830.85 Fuel for vehicle in UB 256.41 Maintenance of computer 1,608.15 Other operating expenses 71.57 Total 7,763.60 As at 25 November, 2015 50,205.92 nfldence Audit LLC Page....
3b. Consultant Texas A&M Agrilife Research firm have contracted with project for service to "Support the development of the early warning system and institutionalization for national agency of meteorology and environmental monitoring". The project have paid following amounts as at 25 November, 2015. As at December 31, 2014 35,198.31 As at 25 November, 2015 35,198.31 3c. Training The training cost have accounted by following as at 25 November, 2015. As at December 31, 2014 60,906.10 Field trip Hall rent 2,785.99 Stationary 466.78 Tea, coffee and meal 32.30 Perdiem 1,022.46 Rental of Vehicle for the fild trip 4,763.82 Translation 2,768.17 Other training expenses 1,795.46 Total 13,634.97 As at 25 November, 2015 74,541.07 3d. Consulting fee The consulting fee has been accounted as following as at 25 November, 2015. As at December 31, 2014 76,479.13 Salaries for specialists 26,772.83 Audit fee 2,563.57 Total 29,336.40 As at 25 November, 2015 105,815.53 3e. Goods The consulting fee has been accounted as following as at 25 November, 2015. As at December 31, 2014 - Adjustment /Computer equipment/ 2,705.61 As at December 31, 2014 2,705.61 Furniture 1,357.77 Air conditioner 1,048.78 Computer equipment 5,105.00 Fencing materials 377,573.81 Total 385,085.36 As at 25 November, 2015 387,790.97 Confidence Audit LLC Pagoe...
3f. Non Consultants service The non consultants service has been accounted as following as at 25 November, 2015. As at December 31, 2014 Project Advocacy and Awareness Campaign 12,814.74 Total 12,814.74 As at 25 November, 2015 12,814.74 4. Net interest earned The net interest earned has been accounted as following as at 25 November, 2015. As at December 31, 2014 1,613.24 Adjustment /Bank charge/ (127.99) As at December 31, 2014 1,485.25 Interest income 2,284.28 Salary (2,000.00) Field trip (1,141.03) Bank charge (2.10) Total (858.85) As at 25 November, 2015 626.40 Confidence Audit LLC Page..Z.