THE REPUBLIC OF UGANDA S_REiPORT_OF_ HE_AUDI_TOR GENERAL ON THE FINANCIAL STATEMENTS OF KAMPALA INSTITUTIONAL AND INFRASTRUCTURE DEVELOPMENT _P_ROJECT PHASE 2 (KIIDP 21 - IDA CREDIT NO.53840 FOR THE YEAR ENDED.30TH JUNE 2021 OFFICE OF THE AUDITOR GENERAL UGANDA OFFICE OF THE EXECUTIVE DIRECTOR REF: ED/KCCA/006/12 22nd December, 2021 The Auditor General Auditor General's Office P.O. Box 7083 KAMPALA KAMPALA CAPITAL CITY AUTHORITY -KAMPALA INSTITUTIONAL AND INFRASTRUCTURE DEVELOPMENT PROJECT (KIIDP2) DRAFT FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 30TH JUNE, 2021 Please find enclosed the Kampala Capital City Authority KIIDP2 Financial Statements for the Financial Year ended 30th June, 2021 for your consideration in accordance with the Pub4d Finance Management Act, 2015. SDoro1y Kisaka rCUTIVE DIRECTOR Encl: KIIDP2 Financial Statements for the Financial Year ended 30th June, 2021 Copy: Deputy Executive Director, KCCA Director Internal Audit, KCCA Director Treasury Services, KCCA Project Coordinator, KIIDP2 RII THE WORLD BANK ffter 6Yy SECOND KAMPALA INSTITUTIONAL & INFRASTRUCTURE DEVELOPMENT PROJECT FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30TH JUNE, 2021 N N Prepared by KilDP2 Project Secretariat July, 2021 I I / MM il PIRIORAIMM REPORT FOR ff 2020/21 7.0 Financial Statements for a Period of Twelve Months ended 30th June 2021 7.1 Statement of Project Management Responsibilities It is the responsibility of the Management to prepare financial statements which give a true and fair view of the state of affairs of the project as at 30th June 2021 and of its receipts and payments for that period. In preparing those statements, Management is required to: a) Select suitable Accounting Policies and apply them consistently, b) Make judgment and estimates that are reasonable and prudent. c) Comply with International Standards, local news, Statutes, World Bank/ IDA loan guidelines and regulations. d) Prepare the financial statements on the Going Concern basis unless it is inappropriate to presume that the project will not continue in the near future. The Management is responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the financial position of the project, and to ensure that the financial records comply with the funding agreements. The Management is also responsible for safeguarding the assets of the project and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Management confirms that in their opinion: a) The financial statements have been prepared in accordance with the International Public Sector Accounting Standard (IPSAS)-Modified accrual basis whereby cash/receipts are recognized when received and expenses are recognized when services are acquired/ consumed, and bills/invoices are received. b) The financial statements give a true and fair view of the financial position of the project as at 30th June 2021, and of its receipts and payments for twelve months' period then ended. c) The project receipts and disbursements were in accordance with- unding Agreement/IDA Credit No.53840-UG, Donny Kitabire Muganzi Dor y Kisaka AG. 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DIRECTOR TREASURY SERVICES 7i ECUTIVE DIRECTOR, KCCA Date: Date: JA 59 / mmu Punwyampow fm fr 2v2#12i 7.1.3 Statement of Financial Position for a Period of Twelve months ended 30th June 2021 Current Assets Ushs Ushs Cash and Cash Equivalents 7.2.5 49,953,066,414 28,673,215,517 Receivables 7.2.6 45,938,041,725 67,434,540,900 Cumulative Foreign Exchange gainl(loss) 95,891,108,139 96,107,756,417 Equity and Liabilities Cumulative Fund Cumulative Reserves (IDA) 7.2.10 169,917,056,945 109,748,775,273 Cumulative GOU Reserves (Escrow 7.2.11 45,962,481,262 45,962,481,262 Account) Cumulative Foreign Exchange 7.2.12 6,513,954,067 6,513,954,067 gain/(loss) Adjusted Expenditure 7.2.9 (142,233,605,844) (66,917,433,328) Cumulative Fund Balance 80,159,886,430 95,307,777,274 Current Liabilities Creditors 7.2.14 15,731,221,709 799,979,143 Total Equity and Liabilities 95,891,108,139 96,107,756,417 These Financial Statements were signed on behalf of Kampala Capital City Authority by: Donny Kitabire Muganzi Dorothy Kisaka AG. DIRECTOR TREASURY SERVICES EXECUTIVE DIRECTOR, KCCA Date: J i)- 2 { Date: ________ O0/ OMI PERFM I7 REPOT IOR F 202021 7.1.4 Special Account Statements Depository Bank Bank of Uganda Currency US Dollars PART A: ACCOUNTING ACTIVITY 2021 2020 Balance as at 01 July, 2020 Add: Total amount deposited by the World Bank 34,000,000.00 20,000,000.00 S Less: Total amount withdrawn 34,000,000.00 (20,000,000.00) Balance as at 30 June, 2021 PART B: ACCOUNT RECONCILIATION Balance on Special Account as at 30 June, 2021 - Balance on UGX Project Account as at 30 June, 2021 1,314,442.86 184,339.68 Balance on TSA-DA Account as at 30 June, 2021 10,667,285.10 4,691,886.80 Amount spent to date 114,775,512.69 87,881,014.17 Amount of Project Disbursement as at 30 June, 2021 126,757 40.65 92,757,240.65 These Financial Statements were signed on behalf of Kampala City Authority by: Donny Kitabire Muganzi D r'hy Kisaka AG. DIRECTOR TREASURY SERVICES EXECUTIVE DIRECTOR, KCCA Date: Date: 61 / M"M PERFOAHM F REPORT FOR Ifr2020121 7.1.5 Statement of Cash flow (Direct Method) OPERATING ACTIVITIES Ushs Ushs Cash Inflows: Government of Uganda - GOU 0 World Bank - IDA Credit No. 53840 125,199,900,000 72,948,349,137 Refund of Garnishees 1,885,815,000 11,763,422,195 127,085,715,000 84,711,7,332 Cash Outflows: Expenses for the period 105,805,864,103 93,446,111,932 21,279,850,897 (8,734,340,600) Foreign Exchange Loss/Gain NET INCREASE/ DECREASE IN CASH AND CASH 21,279,850,897 (8,734,340,600) BALANCES Opening Cash Balance as at 01 July, 2020 28,673,215,517 37,407,556,117 Direct Payments on Account Closing Cash Balance as at 30 June, 2021 49,953,066,414 28,673,215,517 Balance 21,279,850,897 8,734,340,600 62 / MAl PERFORNfREPORT ORI 2020/21 M 7.2 Notes to the Accounts The following accounting policies apply to the project. M The accounting currency of the project is the Uganda shilling. The Financial Statements of the project are prepared on a modified accrual basis and comply with International Public Sector Accounting Standards. Funds are recognized as receipts when they are received. Expenses are recognized when incurred and when the project has consumed the services and / or acquired the asset. Non-current assets are expensed on acquisition. Transactions on the various project accounts are recognized and accounted for as follows; This is denominated in United States Dollars. The account has so far received a total disbursement of $126,757,240.65. All receipts are based on future projections for Project spending. Payments out of the account are comprised of transfers to the Project Uganda Shillings account and dollar based expenditures. Payments are converted into Uganda shillings at the ruling exchange rate on the transaction date. Receipts are comprised of transfers from the Special account and recognized when actual cash is received into M the project account. Payments are comprised of the Uganda shilling project expenditures. Receipts are comprised of transfers from GOU and are recognized when actual cash is received into the ' account. Payments are comprised of the Uganda shilling project expenditures related to compensations on the Resettlement Action Plan' (RAP). All the property, plant and machinery acquired during the year are expensed through the source and use of funds statement. 63 / OM PFfRffIIa ffT RPORT f#RfF2020/21 All transactions denominated in foreign currencies are converted at the spot exchange rate ruling at the the transaction. All project assets and liabilities denominated in foreign currency at the year-end are tra into Uganda shillings at the rate ruling at the year-end. All foreign currency exchange differences aris accounted for through the source and use of funds statement. The ruling exchange rate as at 30th Jun was Ush3,559.07 for one US dollar and the Budget for the FY2020/2021 was translated at $1 =Ush3,700. These are comprised of cash on bank accounts CASH AND CASH EQUIVALENTS Ushs Ushs Bank of Uganda Special Account - 7.2.7.1 - 003220088400002 Bank of Uganda Project Account. 7.2.7.2 4,678,194,146 688,571,533 003220088000006 Bank of Uganda Escrow Account - 7.2.7.3 3,268,608,881 2,905,105,133 003220088000004 Bank of Uganda Escrow2 Account - 7.2.7.4 - 003220088000010 Project balances with the Treasury Single 7.2.7.5 42,006,263,387 25,079,538,851 Account in MoFPED 49,953,066,414 28,673,215,517 Stirling Sobetra Joint Venture 8,042,275,433 11,248,226,563 KCCA (Garnishees) 1,323,171,260 3,208,986,260 Corporate Gifts Limited - 209,140,000 Fabrication Systems (U) Ltd 191,520,000 #4 / JWRLl PERRAMHa REPORT FOR F M202021 Ad Concepts 382,200,000 China Railway No.10 Engineering Co., Ltd 12,629,984,130 12,629,984,130 Energo Projects Niskogradja Joint Stock Company-Kasubi 1,793,104,733 Energo Projects Niskogradja Joint Stock Company-Tuba 3,472,616,068 Bulabira Jiangxi Water Hyadro power Construction Co. Limited 4,030,336,484 Total Receivables for the year 45,938,041,725 67,434,540,900 Receipts from IDA 34,000,000.00 125,199,900,000 Transfer to Project Account (2,500,000.00) (9,205,875,000) Transfer to the Treasury Single Account in MoFPED (31,499,980.00) (115,993,951,353) 1Expenditure on Account (20.00) (73,647) Balance c/f Receipts from Special Account 2,500,000.00 9,205,875,000 Receipts from the Treasury Single Account in MoFPED 25,116,855.77 92,489,053,834 Exchange Gain on Account 80,542.26 Transfer to the Treasury Single Account in MoFPED Garnishee Expenditure on Account (26,567,294.85) (97,705,306,222) Balance c/f 1,314,442.86 4,678,194,145 65 / ImWM PFRHMULa REPORT IORF2020/21 Receipts from GOU Receipts from the Treasury Single Account in MoFPED 1,747,905.65 6,578,172,983 Exchange Gain on Account 219,813.30 Transfer to the Treasury Single Account in MoFPED Garnishee refund (529,861.73) 1,885,815,000 Expenditure on Account (2,215,594.43) (8,100,484,235) Balance c/f 918,388.48 3,268,608,881 Receipts from Escrow Account Exchange Gain/Loss on Account Transfer to TSA Balance c/f Receipts from the Project Accounts 31,499,980.00 115,993,951,353 Exchange Gain/Loss on Account (4,238,923.40) Transfer to Project UGX Account (26,864,761.41) (99,067,226,817.00) Garnishee Balance c/f 11,317,236.50 42,006,263,387 66 / AMJMf PERFORMF RPORT F OR F 2020/21 The status of the project as at 30 June 2021 was as follows: Project Funding 8,750,000.00 175,000,000.00 183,750,000.00 Amount Received 12,870,563.85 126,757,240.65 139,627,804.50 Balance (4,120,563.85) 48,242,759.35 44,122,195.50 Civil Works (Construction drainage works) 5,383,725,849 Civil Works (Construction urban traffic -Batch2) Lot1 54,296,719,814 Civil Works (Construction urban traffic -Batch2) Lot2 31,625,154,933 Civil Works (Construction urban traffic -Batch2) Lot3 25,524,641,578 Consultancy Services (Supervision)-Batch2 9,703,734,343 Implementation of CAMV 4,251,508,809 Street Mapping, Naming & Plot Addressing 432,987,832 Support to KCCA Traffic & Transport Planning unit 386,853,355 Personnel costs 2,553,490,770 Subtotal 134,158,817,283 Compensation to 3rd parties - RAP 8,074,788,561 Total 142,233,605,844 S 67 / Ml1R PERFORAM OT,flFPORT FIFY 202/21 Less: Cumulative Foreign Exchange gain/(loss) as at FY19/20 (6,513,954,067) Less: Current Liabilities as at FY19/20 (799,979,143) Cumulative Fund Balance 88,793,823,207 Less Cumulative GOU Receipts as at FY19/20 (45,962,481,262) Reserves (IDA) 42,831,341,945 Add: Receipts in the FY 2020/2021 127,085,715,000 Add: Direct payments in the FY 2020/2021 Cumulative Reserves (IDA) 169,917,056,945 Balance b/f 45,962,481,262 Receipts in the FY 2020/2021 Total 45,962,481,262 Foreign Exchange loss/gain b/f 6,513,954,067 Foreign Exchange loss in the FY 2020/2021 Total 6,513,954,067 less: Retention Civil Works (77,727,561) Less: Excel Construction Ltd 52,031,887 Less: URA Total 8,074,788,561 68 / Off~m PFJ!AFPRfmafPRUrFoBr22#102,t Retention on Civil works -CSCEC-Lot2 5,379,264,790 - Retention on Civil works -Stirling Sobetra-Lot3 3,410,942,678 - Media Houses 3,963,000 3,963,000 Hotel Services 707,500 707,500 University of Southern California 16,893,765 16,893,765 LOTTI INGEGNERIA - 280,172,464 Herbson Safaris Ltd 31,482,000 18,583,200 Korea Engineering Consultants Corporation Ltd (KECC) - 166,677,560 HP Gauff Ingenieure GmbH & Co.KG-JBG 235,254,093 Kiru General Services Ltd - 77,727,561 Crane Engravers 52,031,887 - Geotaxon Consults Ltd 15,816,180 - National Environment Management Authority 34,300,000 - Total payables for the year 15,731,221,708 799,979,143 A / MM PERORMM REPORTFOR ff 2020121