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Oh.. +r-w f la~&.t\1! -'I. ,Uh&,.{Lf'f! &'F-flt\.h r 1 '1 H 11 'i h..ti 'i "'l. +1111 C "'l. 'I. ii 1: C
~"l'C I I Ref.Nokt/cW:i 7- 111-9 . +1 I The Federal Democratic Republic of Ethiopia
Ministry of Finance and Economic Cooperation Date 3 0 MAR 2018 I ---=-=-· C..::... I
World Bank Ethiopia country office, Addis Ababa
Subject:- Annual Audit Report on PBS-III Proiect Sub-programs A, B and ESPES program EFY 2009
It is to be recalled that the OF AG has conducted annual audit for PBS-III project Sub-program A, B and
ESPES program for EFY 2009 and had been submitted to The World Bank Country Office.
However, MoFEC noted that the submitted audit reports were missing some essential elements and
decided the audit report to be revised considering these elements.
Accordingly, OFAG has revised the audit reports by incorporating the missing elements. We have,
therefore attached herewith the revised PBS-III project Sub-program A, B and ESPES program EFY 2009
C.C:
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>MoFEC
Best Regards,
£ Channel One Programs Coordinating Directorate
Provisional Coordinator
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Federat Democratic Republic of Ethiopia Office of the Federal /\uclitor General
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Ministry of Finance and Economic Cooperation
Addis Ababa
. . . . ·. Re: ·· Submission of the PBS III -Project Sub--:-Programs
· A, Band ESPES Program Audit Report
It is to be recalled that the Ethiopian Government and the Development Partners have reached an Agreement regarding the Annual Audit of the Project Financial Statements of the promoting of Basic Services III (PBS III) Project Sub-programs A and Band Enhancing shared prosperity through Equitable service (ESPES) program to be submitted to the Ministry of Finance and Economic Cooperation by the Office of the Federal Auditor General.
We have, therefore, attached herewith the PBS III Project Audit report for the Year ended sene 30, 2009 (7 July 2017).
Sincerely yours,
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F.accbook- ()ffice of'.thr Fed~ ... ra! Auditor Gener~:?/, Ethiop,·a
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[I The Federal Democratic lJ Republic of Ethiopia Vh.Tr-A.Y '°~&-t\'f! "L 'P'h&-lt.Y'f &1Nllt.h
[1a OFFICE OF THE FEDERAL 1rJ AUDITOR GENERAL
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THE FEDERAL DEMOCRATIC RPUBLIC OF ETHIOPIA
MINISTRY OF FINANACE AND ECONOMIC COOPERATION
PROMOTING OF BASIC SERVICES ill PROJECT
SUB-PROGRAMS A, B AND ENHANCING SHARED PROSPOR
ITY THROUGH EQUITABLE SERVICE( ESPES}
INDEPENDENT AUDITOR'S REPORT ,AUDIT FINDINGS AND
RECOMMENDATIONSONTHEPROJECTFINANCIAL
STATEMENTS
FORTHE YEARENDED7JULY2017
05 January 2017·
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INDEPENDENT AUDITOR'S REPORT ON THE PROJECT FINANCIAL STATEMENTS OF THE MINISTRY OF FINANCE AND ECONOMIC COOPERATION OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICES III PROJECT SUB-PROGRAMS A AND BAND ENHANCING SHARED PROSPITY THOUGHY EQAUTABLE SERVICE (ESPES) PROJECT
We have audited the accompanying Project Financial Statements of
the Promoting of Basic Services III Project Sub-Programs A and B
and Enhancing Shared Prosperity through Equitable Service
(ESPES) project of the Ministry of Finance and Economic
Cooperation of the Federal Democratic Republic of Ethiopia for
the year ended 7 July 2017, which has been financed by IDA
Financing Agreements IDA51620, IDA5716, Multi Donors Trust Fund
Financing Agreement TF13952, Austria fund and Italy fund.
The preparation of the Project Financial Statements (PFSs) is
the responsibility of the Ministry of Finance and Economic
Cooperation. This audit is a special purpose audit for the
Promoting of Basic Services III Project Sub-Programs A and B and
Enhancing shared prosperity through Equitable service (ESPES)
whose terms of reference are those given in the Terms of
Reference for the audit of Promoting of Basic Services III (PBS
III) Project Sub-Programs A and B and Enhancing Shared
Prosperity thought Equitable Service (ESPES). These Terms of
Reference include, inter alia, our responsibility to express an
opinion on. the Project Financial Statements based on our audit
and report on material inappropriate expenditure and other
pertinent matters.
We conducted our audit in accordance with the International
Standards on Auditing (ISA) issued by the International Auditing
and Assurance Standards Board of the International Federation of
1
Accountants with special reference to ISA 800 and the World Bank
relevant Guidelines for the World Bank financed projects.
These Standards require that we plan and perform the audit to
obtain reasonable assurance that the financial statements are
free of material misstatement. An audit includes examining on a
sample test basis of the 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 the overall
financial statement presentation, We believe that the audit
evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
In our opinion, the Project Financial Statements present fairly,
in all material respects, the financial position as at 7 July
2017 and the cash receipts and disbursements for the year then
ended of the Promoting of Basic Services III Project Sub
Programs A and B and Enhancing Shared Prosperity through
Equitable Service of the Ministry of Finance and Economic
cooperation of the Government of the Federal Democratic Republic
of Ethiopia which were prepared on a modified cash basis and in
accordance with the accounting policy of the Government of the
Federal Democratic Republic of Ethiopia.
Emphasis of matters:
• Budget amounting to Birr 973,220.00 allocated and approved
for the Harari Health Bureau was not used for the intended
purpose rather it was transferred to non- basic service
providing sectors
• Budget allocated to basic service providing sectors in Ambo
Woreda amounting to Birr 732,612.4 was not used for the ···~
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intended purpose as it was transferred to none
service sector.
OFFICE OF Regional Auditor General:
basic
• For Transfer amounting to Birr 1,250,933.16 made to Office of
Auditor General, supporting documents were not made available
for the audit.
Regional Council Office:
• For Transfer amounting to Birr 731,325.00 made to Regional
council Office, supporting documents were not made available
for the audit.
In addition, in our opinion, in all material respects:
• During the year, all external financing has been used
in accordance with the conditions of the relevant financing
agreements and only used for the purposes for which the
financing was provided; Except for the matter disclosed in
the Emphasis of matter paragraph and management letter.
• Counterpart funds have been provided and. used in accordance
with the relevant financing agreements and only for the
purposes for which ttey were provided;
• Goods, works and services financed under the Project have
been procured in accorduncc with the relevant financing
agreements including specific provisions of the World Bank
Procurement policies and procedures;
J?0'.:l I ~;lfjThe necessary supporting documents, records and accounts have
been maintained in respect of all project activities,
including expenditures/transfers reported in Interim
Unaudited Financial Reports (IFRs). In addition, the IFRs
issued, during the audit were in agreement with the underlying
books of accounts. Except for the matter disclosed in the
Emphasis of matter paragraph and management letter.
• Designated Accounts have been maintained in accordance with
the provisions of the relevant financing agreements, and
funds disbursed out of the accounts were used only for the
purpose intended in the financing agreement;
• National laws and regulations have been complied with and
that the financial and accounting procedures approved for the
Project were followed and used; Except for the matter
disclosed in the Emphasis of matter paragraph and management
letter.
• Financial performance of the project was satisfactory; and
• Assets procured from project funds existed and there was
verifiable ownership by the implementing agencies or
beneficiaries in line with the financing agreement. Except
for the matter disclosed in the Emphasis of matter paragraph
and management letter.
4
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICES III PROJECT SUB PROGRAMS A AND BAND ENHANCING SHARED PROSPORITY THROUGH EQUITABLE SERVICE PROGRAM CONSOLIDATED STATEMENT OF FINANCIAI, POSITION AS AT 7 JULY 2017.
ASSETS
CURRENT ASSETS
Cash balances
Advances
Total current Assets
CURRENT LIABILITIES
Account Payable
NET CURRENT ASSETS
REPRESENTED BY
ACCUMULATED FUND
Notes
3
4
5
NB: Cents have been rounded to Birr.
7 July 2017
Birr
98,856,799.00
21,178,794.00
120,035,592.00
4,455,864.00
115,549,728.00
].15,549,728.00
5
MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICES III PROJECT SUB-PROGRAMS A AND B CONSOLIDATED STATEMENT OF SOURCES AND USES OF FUNDS FOR THE YEAR ENDED 7, JULY 2017.
Opening Balance
Beginning Balance Adjustment PBS Ill Financing
International Development Association( IDA) 51620
Trust Fund (TF) 13952 From IDA 5716
From Italy Austria Fund Sub Total
Contribution by the Ethiopian
Government (Counterpart fund) Gain on foreign Exchange
Total Financing
PBS Project Expenditure
Sub-Program A Sub-Program B
Total Project Expenditure
Excess of Financing over Expenditure (Accumulated Fund)
6
7
For the year
ended 7 July 2017 Birr
173,450,857.00 370,102.00
216,707,103.00 0.00
2,991,259,609.00 0.00
0.00
3,381,787,672.00
58,741,053,306.30
8,025,631.00
62,130,866,609.30
61,750,458,640.00 264,858,241.00
62,015,316,881.00
115,549,728.30
Note: - Pease note that ETB 12,168,453.74 is included in this budget year due to which incurred as special commitment was not reported as source in the previous year
6
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA DESIGNATED DOLLAR ACCOUNTS WITH EQUIVALENT BIRR AMOUNT STATEMENT FOR THE ENHANCING SHARED PROSPERITY THROUGHY EQUITABLE SERVICES (ESPES).
For the year ended
Account Number
Depository Bank
Address
Currency
BEGINNING BALANCE
Fund Received From: International Development Association
{IDA)5716 Total
Deducted -Transfer to:
Government Treasury account
Bank Service Charge
Total Fund Available
Closing balance Gain on foreign exchange
ENDING BALANCE-7 JULY 2017
Amount in USD
67,858.13
133,022,562.57
133,090,420.70
133,050.000.00
133,050,000.00
40,420.70
40,420.70
7 JULY 2017
010010/1300528
NBE
Addis Ababa, Ethiopia
USD and Birr
Amount in Birr
1,481,397.26
2,991,259,609.40
2,992,741,006.66
2,997,236,880.00
2,997,236,880.00
(4,495,873.34) 5,430,759.67
934,886.33
Note: ETB( 4,495,873.34) was revealed due to Dollar exchange rate made vary during fund
received and fund transferred to Gov. treasury.
NB: The closing exchange rate used for ending balance is 1USD=23.1289
7
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA DESIGNATED DOLLAR ACCOUNTS WITH EQUIVALENT BIRR AMOUNT STATEMENT FOR THE PBS III Sub Program A
For the year ended
Account Number
Depository Bank
Address
Currency
BEGINNING BALANCE
Fund Received From: International Development Association (IDA)
Trust Fund (TF)
ITALY
Austria Fund
Total Fund Available
Deduct-TRANSFER TO Government Treasury Account-Birr Bank Service Charge
Total Transfers
Closing Fund Balance
Gain on foreign exchange
ENDING BALANCE-7 JULY 2017
7 JULY 2017
02615/147000/00
NBE
Addis Ababa, Ethiopia
USD and Birr
Amount in USD Amount in Birr
338,018.00 7,379,195.28
0 0
Q Q
338,018.00 7,379,195.28
0
0
338,018.00
338,018.00
0
_Q
7,379,195.28
438,778.14
7,817,973.42
NB: The closing exchange rate used for ending balance i~ 1U5D=23.1289
8
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA DESIGNATED DOLLAR ACCOUNTS WITH EQUIVALENT BIRR AMOUNT STATEMENT FOR THE PBS III SUB-PROGRAM B
For the year ended
Account Number
Depository Bank
Address
Currency
BEGINNING BALANCE
Add: Receipt
Fund Received From IDA 51620
Fund Received From -TF 13952
Total Fund Available
DEDUCT-Transfer To: Bl and B2 Birr Account B3 Birr Account
MoFEC Finance
Transfer to CSA
Bank Service Charge
Total Transfers and expenditure
Closing Fund balance
Gain on foreign exchange
ENDING BALANCE-7, JULY 2017
Amount in USD
2,346,774.06
9,140,942.56
Q
11,4871716.62
6,900,000.00 4,200,000.00
52,160.00
11,152,160.00
335,556.62
335,556.62
NB: The closing exchange rate used for er,ding balance is 1USD=23.1289
(335,556.62*23.1289}= 7,761,055.51
7 JULY 2017
02615/148000/00
NBE
Addis Ababa, Ethiopia
USD and Birr
Amount in Birr
51,231,955.15
204,538,649.44
Q
255,770,604.59
154,870,990.00 94,015,350.00
1,151,823.20
250,038.163.20
5,732,441.39
2,028,614.12
7,761,055.51
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA DESIGNATED BIRR ACCOUNTS STATEMENT FOR THE PBS III SUB-PROGRAMS Bl AND B2
For the year ended
Account Number
Depository Bank
Address
Currency
Beginning Balance
ADD: Transfer from Pooled Special Account
Total fund available
TRANSFER TO REGIONAL/ PROGRAM IMPLEMENTING ENTITIES:
Tigray National Regional State
Afar National Regional State
Amhara National Regional State
Oromiya National Regional State
Somali National Regional State
Benshangul-Gumuz National Regional State
Southern Nations, Nationalities and people's Regional State
Gambella Peoples National Regional State
Harari National Regional State
Dire Dawa City Administration
Addis Ababa City Administration
Office of the Federal Auditor General (OFAG)
Ministry of Finance and Economic Cooperation (MoFEC)
Total Transfer
Bank Service Charge
Sub Total
ENDING BALANCE-7, JULY 2017
7, JULY 2017
01601/014311/00
NBE
Addis Ababa, Ethiopia
Birr
9,909,056.45
154,870,990.00
164,780,046.00
7,869,430.94
6,277,319.22
23,785,820.78
22,868,409.43
9,750,311.75
4,976,673.83
26,156,491.84
4,922,149.47
3,516,230.17
4,453,709.75
16,642,756.97
7,910,906.45
19,468,942.38
158,599,152.98
387,177.49
158,986,330.50
5,793,715.98
10
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA DESIGNATED BIRR ACCOUNTS STATEMENT FOR THE PBS III SUB-PROGRAM B3
For the year ended
Account Number
Depository Bank
Address
Currency
Opening Balance
Add: Transfer from Pooled Special Account
Total fund available for use
Less: Transfer and Expenditure
Transfer to CSA
Transfer to MoFEC
Transfer to MOA
Transfer to MOWIE
Transfer to MOH/EHN RI
Transfer to Regions for B4 Activities
Transfer to Tigray
Transfer to Afar
Transfer to Am hara
Transfer to Oromia
Transfer to Som ale
Transfer to Benshangul
Transfer to SNNPR
Transfer to Gambella
Transfer to Hareri
Transfer to Diredawa
Transfer to Addis Ababa
Total Transfer
Expenditure
Bank Service Charges
Total Transfer & Expenditure
CLOSING BALANCE-7, JULY 2017
34,659,875.00
60,591,451.61
2,918,301.14
0
438,400.00
207,570.00
1,462,570.00
2,675,540.00
1,443,100.00
195,630.00
1,346,920.00
141,660.00
34,140.00
84,090.00
259,570.00
106,458,817.75
235,038.39
71 JULY 2017
0160101431200
NBE
Addis Ababa, Ethiopia
Birr
20,081,924.93
94,015,350.00
114,097,274.93
-·.
106,693,856.14
7,403,418.79
MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICES III PROJECT SUB-PROGRAMS A AND BAND ENHANCING SHARED PROSPORITY THRUOGY EQIUTABLE SERVICE(ESPES) DECLARATION OF NON-PROCUREMENT OF MATERIAL ASSETS FOR THE YEAR ENDED 7, JULY 2017
We hereby declare that there were no material assets acquired or
procured to date with the project funds for the sub-programs that
are valued individually at USD 20,000 or more each and financed by
the project.
12
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRA~IC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICE III PROJECT SUB PROGRAMS A AND BAND ENHANCING SHARED PROSPERITY THROUGH EQUITABLE SERVICES (ESPES) NOTES TO THE PROJECT FINANCIAL STATEMENTS FOR THE YEAR ENDED 7, JULY 2017
1. BACKGROUND
With the objective of expanding access and improving the
quality of basic services in Education, Health, Agriculture,
Water Supply and Sanitation and Rural Roads delivered by sub
national governments and strengthening financial transparency
and accountability in service delivery, the Government of
Ethiopia and the World Bank signed the Promoting of Basic
Services (PBS III) Project which commenced in December 11,
2015. PBS III has two sub-programs. These sub programs are
implemented by MoFEC is discussed as under:
SUB-PROGRAM A - It is to contribute to the higher level of
objective of promoting basic service and improving the
quality of Government services at Regional and local
_levels.
ESPES - It is a portion of Sub-program A which focuses on
improving equitable access to basic service and Strength
accountability and institutionalizes critical Systems at
the decentralized level.
SUB-PROGRAM B Support to strengthening the capacity,
transparency, accountability and financial management
Government at Regional and Lo~al authority levels.
of
13
2. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted by the Project,
which are consistent with those applied in the preceding
period, are stated below:
a) BASIS OF PREPARATION:
i) These Financial Statements have been prepared on a
modified cash basis in accordance with the accounting
policy of the Government of the Federal Democratic
Republic of Ethiopia.
ii) The Project Financial Statements combine transactions of
Sub-Programs A and B of the Promoting of Basic Services
III (PBS III) and (ESPES) Enhancing Shared Prosperity
through Equitable Service for reporting consolidated
transactions of all of these sub-programs.
b) CURRENCY
These financial statements presented in birr. are
Transactions in foreign currency are translated into birr
at the approximate rate of exchange prevailing at the date
of the transaction.
14
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICE (PBS III) PROJECT SUB-PROGRAMS A AND ENHANCING SHARED PROSPERITY THROUGH EQUITABLE SERVICE (ESPES) NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 7, July 2017 3. CASH ON HAND AND AT BANK Balance in Pooled Dollar account No 02615/147000/00 Balance in pooled Dollar account No 0100101300528 Balance in Dollar account No. 02615/148000/00 Balance in Birr account No. 0160101431100 Balance in Birr account No. 0160101431200 BALANCE AT BANK MoFEC Balance at Regions B
Cash on hand Cash in transit Cash at bank
TOTAL CASH BALANCE 4.ADVANCES
These are advances for sub-programs B Tigray Afar Amhara Oromia Somali Benshangule-Gumuz SNNPR Gambella Harari Dire Dawa Addis Ababa MoFED OFAG EPHI CSA MOA MOWE TOTAL 5. ACCOUNT PAYABLES
These are payables for sub-programs B Tigray Afar Amhara Oromia Somali Benshangule-Gumuz SNNPR Gambella Harari Dire Dawa Addis Ababa MoFED OFAG EPHI CSA MOA MOWE TOTAL
220,669.27 0.00
68,825,079.30
Birr
14,327.50 343,725.05
2,021,917.31 -121,148.80
552,349.91 6,232,216.86
271,868.63
623,475.97 7,132,807.54 1,139,290.13
71,907.00 1,914,985.20
4,883.00 733,890.86
21.178,793.76
51,664.44 31,607.92
668,053.07 44,296.28
28,974.35 230,308.29 28,200.00 1,591.40 2,678.04
1,421,311.14 1,795,266.19
148,906.57
33,006.33
4. 485,864.02
BAND
Birr 7,817,973,42
934,886.33 7,761,055.51 5,793,715.98 7,403,418.79
29,711,050.02
69,145,748.57 98,856,798.59
Total
14,327.50 343,725.00
2,021,917.00 121,149.00
552,350.00 6,232,217.00
271,869.00
623,476.00 7,132,808.00 1,139,290.00
71,907.00 1.,914,985.00
4,883.00 733,891.00
21,178,794.00
51,664.44 31,607.92
668,053.29 44,296.28
28,974.35 230,308.29 28,200.00 1,591.40 2,678,04
1,421,311.13 1,795,266.19
148,906.57
33,006.33
4.485,864.00
15
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MINISTRY OF FINANCE AND ECONOMIC COOPERATION GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICE (PBS III) PROJECT AND ENHANCING SHARED PROSPORITY EQUITABLE SERVICE SUB-PROGRAM A AND B NOTES TO THE PROJECT FINANCIAL STATEMENTS FOR THE YEAR ENDED 7, JULY 2017
6. EXPENDITURE OF SUB-PROGRAM A
Education Health (Including HIV/AIDS) Agriculture and Natural Resource Water Supply and Sanitation Rural Road TOTAL
7. EXPENDITURE OF SUB-PROGRAM B Personal Services
Goods and Services
Fixed Assets
TOTAL
35,978,315,720.00
13,709,326,540.00 9,201,701,530.00 2,147,286,750.00
713,828,100.00 61,750,458,640.00
76,804,475.61 175,939,207.01
12,114,558.15 264,858,241.00
16
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GOVERNMENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICE III PROJECT SUBPROGRAMS A AND BAND ESPES ENHANCING SHARED PROSPERITY THROUGH EQUITABLE SREVICE A RECONCILATION OF AMOUNTS "RECEIVED BY THE PROJECT FROM THE DEVELOPMENT PARTNERS (INCLUDING THE WORLD BANK)" WITH THOSE SHOWN AS BEING "DISBURSED BY THE DEVELOPMENT PARTNERS (INCLUDING THE WORLD BANK)"
FOR THE YEAR ENDED 7, JULY 2017
International Development Association (IDA)51620 International Development Association (IDA)51620
USO 9,140,942.56
USO
USO 9,140,942.56 B Advance
USO B Advance 3 International
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Development Association (IDA) 5716
4 International Development Association (IDA) 5716
5 Trust Fund (TF) 13952
Italy Fund
Austrian Fund
Note:
USO 133,023,562.57
USO
USO 0.00
USO 0.00
USO 0.00
USD 133,023,562.57 ESPES Advance
USO ESPES Advance
USO 0.00 A Reimburseme nt
USO 0.00 A Advance
USO 0.00 A Advance
• International Development Association (IDA): Credit Number 51620-ET
• International Development Association (IDA): Credit Number 5716-ET
• Multi Donors Trust Fund (TF): Grant Number 13952
• Italy Fund:
• Austria Development Fund Agency.
MINISTRY OF FINANCE AND ECONOMIC COOPERATION THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA PROMOTING OF BASIC SERVICES PHASE III PROJECT SUB-PROGRAMS A AND B AUDIT FINDINGS, RECOMMENDATIONS AND MANAGEMENT RESPONSES ON THE ACCOUNTS FOR THE YEAR ENDED 7 JULY 2017
I. INTRODUCTION
We conducted the audit under the power conferred upon the
Office of the Federal Auditor General by Proclamation Number
982/2016. Our audit followed the audit requirements included
in the Terms of Reference (ToR) for the audit of the
Promoting of Basic Services III (PBS III) Project Sub
programs A and B for the year ended Sene 30,2009 (7 July
2017) .
This report deals with the findings and recommendations which
came to our attention during our normal audit procedures
which were designed primarily with a view to the expression
of our opinion on the Project Financial Statements ( PFS) of
the Promoting of B2..sic Services III (PBS III) Project Sub
programs A and B and a portion of sub-program A (ESPES)
Enhancing Shared Prosperity through Equitable Service
program. The audit was conducted on a test basis and, thus,
our audit cannot be expected to disclose all possible
weaknesses in internal controls and all other findings which
a more extensive special examination might reveal.
I I . BACKGROUND
The relevant Financing Agreements between the Government of
the Federal Democratic Republic of Ethiopia and the
Financiers for Sub-Programs A and B of the PBS III Projects
and ESPES-program are:
• International Development Association
Agreements IDA51620-ET
(IDA) Financing
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• International Development Association
Agreements IDA 5716
(IDA) Financing
• Multi Donors Trust Fund (TF) Financing Agreement TF13952
• ITALY Fund
• Austria Development Fund Agency.
III. SCOPE OF THE AUDIT
a) The audit was conducted in accordance with the International
Standards on Auditing (ISA) issued by the International
Auditing and Assurance Standards Board of the International
Federation of Accountants, with special reference to ISA
800 (Auditor's Report on Special Purpose Audit Engagements)
and relevant World Bank Guidelines. The audit, accordingly,
included such tests of accounting records, transaction,
internal controls, and other procedures as were considered
essential for the performance of this audit.
b) In conducting this audit, we have carried out continuous/
interim and validation audits at various Woredas/Town
Administrations, Zones, Bureaus, Regions and Federal
Implementing Agencies of the Promoting of Basic Services III
Project Sub-Programs A and Band Enhancing Shared Prosperity
through Equitable Service (ESPES) that such review ensured
that the financiul and property managements were reasonably
accurate, reliable and timely.
c) Discussions were held with staffs of the Ministry of Finance
and Economic Cooperation (MoFEC) and the Project
Implementing Agencies at various Government levels.
d) The audit opinion is limited to the funds received from the
Financiers and the Government and of the expenditures
incurred for the Sub-Programs A and .B of the Promoting of
19
Recommended