DCG.255/380/03/21 10"' December, 2021 The Executive Director Private Sector Foundation Uganda - PSFU KAMPALA REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF ERT - III- IMPLEMENTED BY PRIVATE SECTOR FOUNDATION UGANDA FOR THE YEAR ENDED 30TH JUNE, 2021 I am enclosing herewith a report which I have already sent to the Rt. Hon. Speaker of Parliament in accordance with Article 163 (4) of the Constitution of Uganda 1995 (as amended). John F.S. Muwanga AUDITOR GENERAL Copy to; The Permanent Secretary/Secretary to the Treasury Ministry of Finance, Planning & Economic Development "k The Permanent Secretary, Ministry of Energy & Mineral Development The International Development Agency, IDA, Washington DC The Deputy Executive Director, ERT II - PSFU The Director, BUDS-ERT III THE REPUBLIC OF UGANDA REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF ERT III-PSFU FOR THE FINANCIAL YEAR ENDED 30TH JUNE 2021 OFFICE OF THE AUDITOR GENERAL UGANDA Table of Contents REPORT OF THE AUDITOR GENERAL ON THE AUDIT OF FINANCIAL STATEMENTS OF ERT III - PSFU FOR THE FINANCIAL YEAR ENDED 30TH JUNE, 2021 4...,- 4 Unqualified Opinion ... 4 Basis for Opinion .... 4 Key Audit Matter 4 1.0 ImpIlemeitatson of the Approved Budget 4 Other Information 6. Management Responsibilities for the Financal Statements ..... 6 Auditors Responsibilities for the Audit of the Financial Statements, 7 Other Reporting Responsibilities ... ...... 8 Report on the Audit of Compliance with Legislation .8 2.0 Development of 2 Micro Hydro Schemes 8 3.0 Training and Certtfication of W iremen.... . .... ...... 9 2 LIST OF ACRONYMS Acronym Meaning DIT Directorate of Industrial Training EOI Expressron of Interest ERA Electricity Regulatory Authority ERT Electnication for Rural TransforMation F/Y Financial Year GOU Government of Uganda IDA International Development Agency IESBA International Ethics Standards Board for Accountants INTOSAI International Organization of Supreme Audit Institutions ISSA International Standards on Auditing MoFPED Ministry of Finance Planning and Economic Development NAA National Audit Act PAD Project Appraisal Document PFMA Public Finance Management Act, 2015 PSFU Private Sector Foundation Uganda REA Rural Electrification Agency RESP Rural Electrification Strategic Plan SOPs Standard Operating Procedures UGX Uganda Shillings 3 REPORT OF THE AUDITOR GENERAL ON THE AUDIT OF FINANCIAL STATEMENTS OF ERT III -PSFU FOR THE FINANCIAL YEAR ENDED 30TH JUNE, 2021 THE RT. HON. SPEAKER OF PARLIAMENT Opinion I have audited the accompanying financial statements of ERT III -PSFU which comprise the Statement of Financial Position as at 301" June 2021, the Statement of Financial Performance, Statement of Changes in Equity and Statement of Cash Flows together with other accompanying statements for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In my opinion, the financial statements present fairly, in all material respects, the financial position of the Energy for Rural Transformation - PSFU Component as at 30"'June 2021, and its financial performance and cash flows for the year then ended, in accordance with the Basis of Accounting set in the financial statements and in conformity with the Donor Reporting Guidelines and Terms and Conditions. Basis for Opinion I conducted my audit in accordance with International Standards of Supreme Audi In stitutions (ISSAIs). My responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financal Statements Section of my report. I am independent of the Project in accordance with the Constitution of the Republc of Uganda 1995 (as amended), the National Audit Act, 2008, the International Organization of Supreme Audit Institutions (INTOSAI) Code of Ethics, the International Ethics Standards Board for Accountants Code of Ethics for Professional Accountants (Parts A and B) (IESBA Code), and other independence requirements applicable to performng audits of Financal Statements in Uganda. I have fulfilled my other ethical responsibilities in accordance with the IESBA Code, and in accordance with othe ethical requirements applicable to performing audits in Uganda. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key Audit Matter Key Audit Matters are those matters that, in my professional judgment, were of most significance in my audit of the financial statements of the current peri od. These matters were addressed in the context of my audit of the financial statements as a who e, and in forming my opinion thereon, and I do not provide a separate opinion on these matters. I have determined the matters described below to be key audit matters communicated in my report. 1.0 Implementation of the Approved Budget The Energy for Rural Transformation Project (ERT) was staited in 2003. The funding of the Project is a three phase Adaptable Program Loan from the World Bank. The purpose 4 of the ERT Project is to develop Uganda's energy and the Information and Communication Technology (ICT) sectors, so that they make a significant contribution to the qua lity of life of households. The ERT-PSFU component undertook three broad tasks as follows; * Supporting the development of community-based pico/micro hydro schcmes in hard to reach areas; * Facilitating the institutional development and strategic framework deve opment of Uganda Energy Solar Association; * Facilitating the formulation and implementation of various training interventions for accelerated certification of electrical wiremen, I am aware that the Covid-19 Pandemic continues to significantly affect the implementation of several activities. Consequently, a number of activities were not implerented due to budget cuts and lockdown measures insttuted to control the spread of the pandemic. It is against this background that the impk1mentation of the budget was again considered a key audit area during the officeiwide planning for the current audit year. From the procedures undertaken, I noted the following Observation Recommendation 1.1 Revenue Performance I advised the Accounting Performance of Donor Disbursements for the Officer to ensure Period implementation of the The entity budgeted to receive USD 543,056 out of Planned activities to enable which, USD 246,000 was released, resulting in a disbursements of budgeted shortfall of USD 297,056 which is 54.7%', of the budget. Donor funds Revenue shortfalls affect the implementation of planned activities Management explained that funds are requested for, depending on available funds at the end of a reporting period and the projection of the subsequent quarter 1.2 Under Absorption of funds I advised the Accounting At the start of the reporting period, the Project had an Officer to ensure that all opening balance of USD. 390,993. During the financial outstanding activities are year, USD. 246,000 was received from the bank included in the subsequent resulting into a cumulative total of USD. 636,993 work plan and fast tracked available in the year. Out of this, USD.382,224 was to enable service delivery. spent by the entity resulting in an Unspent balance of USD. 254,769 representing absorption level of 60% for the year. The Accounting Officer attributed the under absorption of released funds to slow implementation of project outputs as a result of COVID -19 restrictions 5 Under absorption of ateleased funids results in non- iention of planned acivIties For example, the planned tra inn of wi remeni was not fui y limplemernted. Management explaied that the Covid-19 paidemic during the period under audit significantly affected p)ositive progress of dctivlty iplementation lead ng to under absorpt on of funds. 1.3 Funds Absorption over the Project Life. At the start of the Project, the entity budgeted to I advised the Accounting receive USD 1,500,000 for the ERT PSFU component. Officer to ensure that During the period under review, supplementary funding released funds are utilized amounting to USD, 247,860.00 was received. to implement planned activities. I noted that out of the cumulat ve receIpts of USD. 1,747,860 00, only USD. 1,496,297.13 had been absorbed by the project representing an absorption level of 86% over the project life. Management explained that the Project was granted an extension to the end of December 2021, hence the funds absorption was expected to improve. Other Information The Accounting Officer is responsible for the other information. The other information comprises the statement of responsibilities of the Accounting Officer and the commentaries by the Head of Accounts and the Accounting Officer, and other supplementary information. The other information does not include the financial statements and my auditors' report thereon. My opinion on the financial statements does not cover the other information and I do not express an audit opinion or any form of assurance conclusion thereon. In connection with my audit of the financial statements, my responsibilhty is to read the other information and, in doing so, consider whether the other information is mateially consistent with the financial statements or my knowledge obtained in the audit, or otherwise appears to be material y misstated. If, based on the work I have performed, I conclude that there is a material misstatement of this other information; I am required to report that fact. I have nothing to report in this regard. Management Responsibilities for the Financial Statements Under Article 164 of the Constitution of the Republic of Uganda, 1995 (as amended) and Section 45 of the Pub c Finance Management Act, 2015, the Accounting Officer is accountable to Parliament for the funds and resources of the Energy for Rural Transformation (FRT) III Project. 6 The Accounting Officer is also responsible for the preparation of financial statements in accordance with the requirements of the Donor Reporting Guidelines and for such interna control as management determines necessary to enable the preparation of financial statements that are free from material misstatement whether due to fraud or error. In preparing the financial statements, the Accounting Officer is responsible for assessing the Project's ability to continue delivering its mandate, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting, unless the Accounting Officer has a realistic aternative to the contrary. The Accounting Officer i responsible for overseeing the Project's financial reporting process. Auditor's Responsibilities for the Audit of the Financial Statements My obj:ctives are to obtain reasonable assurance about whether the financial statements as a whole are fre from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes my opinion. Reasonable assurance is a high level of assurance, but s not a guarantee that an audit conducted in accord[ nce with ISSAIs will always dttect a rmateri misstatement, when it exists. Misstatements can arise from fraud or error and are considerec materi Iif, individually or in aggregate, they could reasonably be expected to influence the economic decis ions of use s, taken on the basis of these financia statements. As part of an aud t in accordance with ISSAIs, I exercise professional jdgement and maintain professional scepticsm throughout the audit. I also:- * Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedur s responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. * Obtain an understanding of internal control relevant to the audit in order to design audit procedures that ar appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Project's internal control. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management. * Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Project's ability to continue delivering its mandate. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor's reportL However, future events or conditions may cause the Project to fail to deliver its mandat * Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. 7 I con-rmunicate with the Accounting Officer regarding, among other matters, the planned scope and Tning of the audit and significant audit findings, inc uding any significant deficiencies in intenalconrolthat I identify during my audit. I also provide the Accounting Officer with a statement that I have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other ma tters that may reasonably be thought to bear on my independence, and where applicab e, related safeguards. From the matters communicated with the Accounting Officer, I determine those matters that wee of most significance in the audit of the financia statements of the current period and are therefore the key audit matters. I describe these matters in my auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter shouLd not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Other Reporting Responsibilities In accordance with Section 19 (1) of the National Audit Act, 2008, I report to you, based on my work described on the audit of Financial Statements, that; except for the matters raised in compliance with legislation section below, and whose effect has been considered in forming my opinion on financial statements, the activities, financial transactions and information reflected in the financial staterents that have come to my notice during the audit, are in all materal respects, in compliance with the authorities which govern them. Report on the Audit of Compliance with Legislation In accordance with Section 13 of the NAA 2008, I have a responsibility to report material findings on the compliance of the Project with specific matters in key legislations. I performed procedures primarily to identify findings but not to gather evidence to express assurance. The material findings in respect of the compliance criteria for the applicable subject matters are as follows; 2.0 Development of 2 Micro Hydro Schemes In support of the Rural Electrification Strategic Plan (RESP), the PSFU planned to develop six communities based Micro Hydro Power Generation Schemes in the Districts of Kabarole and Kasese in areas with no access to the National Grid. The Electricity Regulatory Authority (ERA) advised that only four of the six sites should be developed. Following completion of the feasibility studies, two micro hydro sites of DUngulilia and Kithakhena were found technically feasible and financially viable, and were earmarked for Grid access. I noted that a consortium of Ruwenzori Power Ltd (RWP) and East African Power Ltd (EAPL) had been contracted to undertake the development of the schemes. However, by the time of audit (November, 2021) the develonnt of the 2 Micro Hydro schemes had not commenced. 8 Delayed development of the hydro schemes hinders service delivery. The Accounting officer explained that a formal hand over of PSFU's rights (under ERT 3 Project) to the consortium of Rwenzori Power Limited and East African Power Ltd, to develop the two micro hydro schemes is to be effected by 10th Decnber 2021 at the latest and that construction and commissioning of the two micro hydro schemes will take three years I advised the Accounting Officer to ensure that the construction of the 2 schemes is fast tracked so as to facilitate service delivery to the intended beneficary communiti es. 3.0 Training and Certification of Wiremen PSFU coordinates the activity of short-term training, testing and certification of el ctrical wiremen who are making electrical installations but without formal training. The activity covers all regions of the Country. The training is carried out by Uganda Technical Colleges or Vocational Training Institutions that are accredited to the Directorate of Industrial Training (DIT). DIT assesses the trainees and the Electricity Regulatory Authority interviews the trainees. Successful trainees obtain the Electrical Installation Permit Class D, for domestic installations. It was agrecd that four additional training sessions, would be undertaken to enable the achievement of the Project target of 850 house wiring technicians by September 30, 2021. A review of the Progress Report indicated that 367 wiremen were certified during the period, bringing the total number of tota cert fied wiremen under the ERT-PSFU to 747 (88/o), by June 30, 2021, against the Target of 850 certified wiremen implying a net target of 103 wiremen (12%). The un met target may slow down the electrical installations. The Accounting Officer projected that by 31st December 2021, the ERT III Project target of 850 certified wiremen will be achieved. I advised the accounting officer to fast-track the training and certification of Wiremen to enable achievement of the Project objectives and service delivery. John F.S. Muwanga AUDITOR GENERAL 10" December, 2021 9 REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF ENERGY FOR RURAL TRANSFORMATION III IMPLEMENTED BY PRIVATE SECTOR FOUNDATION UGANDA FOR THE YEAR ENDED 30 JUNE 2021 Glossary of abbreviations ER - Energy for Rura Tansformaen PSFJ - rvate Sector Foualon Jganda BDS - Business Deveapment Services CU- 53ank of Uganda BUDS - Busiess Ugana Deveopmen Schemne -SFCredit Support Facility PVTMA -Photo Voltaic Tarrget Market Approach GEFG;oaa Environ'rnent Facwty GOU Governrent of Uanda ICT Information Communiation Technology IDA -Intemnational Developmen: Agency IPSAS -Internationial Public Secto Acceoun ng Standard KVA - Klo Voltage Amps NSSF - Naonal Socia Security Fund PAYE Pay As You Eamn REA - Rural Electrifcation Agency ME- Smal and Mediu~m Enterprises UG3X -Uganda Shiings USD - United States Dollar RE - Rura Eectrificaion SOE - Statemen of Expendure 2 TABLE OF CONTENTS pROJECT NFOM1ATON 1 ~PROJCT MAN/AGEMENT REPORT PROJECT BACKGROUND 2 PRENCIPAL ACV TTIES .2 STATUS OF VAR OUS ACTVTIES 3 ERT i PROJECT PERFORMANCE4 STATEMENT OF PROJECT MANAGMNT'S RESPONC L TY FOR THE FNANCIAL STAT MNTS n FNCAL STATEMENTS 7 STATEMENT OF COMIPREHENSE NCO E BY D SBURSEMENT CATEGORIES .8 STATEMENT OF CASH FLOWS SPECIAL ACCOJNT (SA) ACTMVTY STATEMENT 1 Apri 2021 -30 Jine 2021 < 10 NOTES FORMING PART OF THE FNANCAL STATEMENTS1 NOTES FORMING PART OF THE FNA.NC AL STAT. ENTS 12 SOURCES AND USES OF FUNDS 13 3 1.0 PROJECT INFORMATION Donors ntemrational Dvelopment Assoc iation 181 H Street NW Washintn DC 20433 un ded States of Amerca International Bank for Reconstruction and Developmeant 188H Street NW! Washing ton DC 209433 United States of America Office and Place of Business Plo' 43 Nakasero Road P 0 Box 7683 Kamnpa a, Ugarnda Website: ~vwvpsfqanda oro na Project Management 1 Mr. Stephen As irmwe - E xecutve Director 2 Mr Francis Kisirlnya - Dopty Executive Director 3 Mr Geofrey Ssebugwawo - Drector BUDS - ERT 1 Bankers Bank of Uganda P O Box 7120 KampaIa. Uganda Auditors Office of the Auitor General Apollo Kagwa Road Pon 2C P 0 Box 7083 Kamnpala 1 2.0 PROJECT MANAGEMENT REPORT The Man'agement of :he Energy for Rura' Transformaton Projc: || - Business Development Scheme (BUDS -ERT 1) Private Sector Fou.ndation Ugjanda, presents its Annual R?eeoo and Audinted fnancial statements for the yeer ended 30 Ju ne 2020 2.1 PROJECT BACKGROUND The Energy for Rura Transform an rProject (ERT) was started i 2003. Tre funding of the Project is a three phase Adaptable Program Loan from the World Bank The purpose of the ERT Prcject is to develop Ugad' energy and the Informat en and Commun cation Technology (ICT) sectors so that they make a sjgnificant contribulon to the quait:y of lie of households The ER T~ Project is being imp*emented through dierent components BUDS-ERT Ii being one oe th,m Phase was to put in place an envonment ari related capaciies conducive to commercally riented sustainable service deiivery of rurai renewable energy and ICTs~ The objecI ves et Phase || were to accelerate inve.stments and nrease regional covJerage and, to increase energy efficiency and use of renewable energy techno ogies. The oo:ective of Phase lI is to increase access to electricity in :he rura areaseof Lnda 2.2 PRINCIPAL ACTIVITIES BUDS ERTIll endertook three broad tasks: (a) Suppeotng the development ef commun.ty-based p o/micre hydro schemes in hard to reach areas, (b) Facilitacng the instuttional deveopment and strategic framework developene et Ugeanda Energy Selar Assoc aLsn (c) Facilitatng the formuaon and ipementation f vrnous :e n entr anca Certification of elecnr wet remen 2 2.3 STATUS OF VARJOUS ACTIVITIES Dur Fi an cia Year 202/221 nan l year BUDS- ERT ocuse re fol lowing atv Activity 1: Development of 2 micro hydro schemes Fowin DA s co nirmatin ta' no ERT 3 funds wal be used ta sUpotn he construcn of Dung ulla and K thakhena mio hydru schemes because of the romainin project period PSFU ivied paontial privt sector interest in the cap ialzation. development anda operation of the two schemels A request fo- expression of interest was issued an d three applcants were short sted and fnv ted to make proposa s. Only one of the srhort isted app canits subam Ued a propsaL naimevy a ccnsortium of Rwenzori Power L:d RWP) an East Afrmcan Power Lrd (EAP Folllowing evalaton of the consortumi s proposal PFU agreed to th e conisor um proceeding with further deveopment of the schemes rand the con sortium has provided its acceptance RWP isa Ugandan regsered and based company hele EP Us Rwanda regisered d based EAPL s already invsan i mr andni min hydropower generatio i Rwanca n the consotum pL wi piovide inancial capacity, tchrnical knowedge and exper ence ana RWP wil prcv de project ceadership and loca knowledge PSU w iroduce tho consåruum ta key stakehders, such as the Eect city Reuplatoy Auhority the Mingisry of Energy and iera Develapment and -oca authres 1n Kasese Distric: Activity 2: Training and certification of wiremen to scale up wiring nstallations across the country PSFU coordinatos the acavity of sh"orttrm tra ning testing and certifica on of electrical wremen who are nakin electrica inslallat ons hu witnout forma training The actvity covers al reg aos af the contry The training is camed out by jPanda Tecnca Coieges or V iocatona Training lastueons that are accrede to the Directora at Inoustral Traning (DIT) DIT assess te tranees and tho Electr c y Regu atory Autnaty imerviews the trainces Successfu ramos obtain tno elecr cal Installation Formi Class D, for domst ic ,ista lations. 367 wrme n wore certified auring the peod br ngng tho total number of tota cortfied wicremn under th FSFU ERT arrangement ta 747 by une 30 2021 The current paject target is 85I cerfed wiremo Tho Govrnmont rstr icton npubl c gathngs, arising trom the Covd 19 poandemc Activity 3 Facilitating institutional development and strategic framework development of the Uganda Solar Energy Association (USEA) Sinne Septemer 12 2018, there had been a frame:ak for caoperat an etween PSFU and USEA under ERT 3 The cooperation involved provision of fi anca operational suppart to USEA The framework for cooperation ended an Deceimber 31 2020 v ERT 3 1 nancia suppart throuh PSFU contr:bted ta USlA s ins ut avna development dng the incept on and canso=eaatn staces Daring that perod USLA s me ship grew rcm 40 to 200. i addinon USEA s nmae and integrity grew eading to attracton of other stakeholders t support i e ther hg as or in-kind support 3 2A ERT 1i1 PROJECT PERFORMANCE 2020/2021 W RKPLAN- ACTI Al IM LE I TA IO Planned activity Target Output Actual implementation Actual Output Comments/Challenges Sa Survey the land Survey The Land Surey was ond Survey T,he actvity progressed lan'd of Reor carried out and Rort sumited as planned Dungli a completed iro h ydro projecut area b Invite enerest A deeloper or to r n :.ressel (Eöls) from developers for Yrm-s of Reference sucto~ deve oper ae rp onnd prnvate sector the micro nyaro ere developed and was 2dnt e sites issed i Eo s wre ne developer is a provide ci ,-iireceived and evauatedo Unsor n of development 3 appi cants were invited Rwenzon Power al~ to- i~m prop als ton SEA w, so dn nnd oerat on of onl n' op icant ganda>o East DunguIe= responded and the Afr cn Power d ansub lited prcopsal was basea in K tak rhe n mora yå~oevaluatec Rwanda, scheomes 2 P rov d Strengthenedn Operationa fund support USEA's systems The acti :y progressed institut in institutional was provided to USLA are strengthened as planned oeleopment systems for up to 31 December and USEA is now support to the resource 2020 in pos tion to Uganda Soar mobstion a:tract other Energy membershFp partnes Associa: on development and (USEA) saoar energy sector se- regulato 3 Accelerated 500 wiremen Tranig, testing and 307 trainees nh Govemn and awarded cert finaton of trarnees qua ied for the restrcton on public tif c on of Instllation was norrid out at the Insta la:on Perm gatherng in May 2021. rcenn Permit C oss D of following insti S ansing rom the Cov 19 panoemc nd srupted the lnstalotions S mon Peter Vocationa furher trairuno and Permit Tra nrig Insttute Horna certifcaton sessions Committee (iPC) St K;zito Technica] ht had been planred 4 of the EeiiyV istiue Maderaø Dan1 Reguatodry ombni Technicaø Auuority Gurecr S oseph Technica weyogerere Vocational Trairnn nstitute Karnpala. Nyarniang.a Tecnica ..nttut2 Mbaraa Jr Socat ena D'al ri nstitute anci Vascse Executive Director Kampala, Uganda Date. 20210 2 5 3.0 STATEMENT OF PROJECT MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS Th r World Bark guidelines requ.ire th'at Projec ma nagement prepares its firancal statements for each accounting penad w.hich give a true and tar view of the state of affairs af the Project and of its operating resu s for the year The mranagement of Energy tor Rura. Transformat on (ERT 1) PSFJ Component is respons ble for preparing the financial statements for each nancial year which gives atrue and fa view of the state ot affairs of the Project as at the erd of the frnancoa year. The Projoct management is requi.red to ensure the Project keeps proper accounting records which disclose with reasonab e accuracy at ary time the fmancal position ot the Project They are also responsile fo sateguard ng the assets of the Project and are ultiately responsibte for the intemai cntrols Standards and systems f interra control are desgned and mrplemented ny management to provide reasonable assurance as te the integrity and refabl ty at the financial statements and to adequately safeguardt verify and maintain accountability of the Pro ect s asse:s Appropriate accounting polcaies suappoted by reasonable and prudent juagements and estirnates are applied on a consistent basis These systems and cantrois include tre proper delegation et responsb l ties within a clearly deftned tramewark effect ve accou.nting pracedures and adequate segregation of duties. The management of the Projct accepts resonsb lity for tre statement of comprehensve inome the statement of finaal position ana tre speCial accourt activity statement which has been prepared using appropnate acounting poicies supported by reasonable and prudent judgements and estirnates. Tre management of tre Project are of the opinion that the statement af orenersive income the statement of tfianci position and the speciat accaunt activity statement give a true and far view of tre state of the financial atfairs of the Proect ana at the results at is activties tor the year ended 30 June 2021 Tre managemnent at the Project turther accepts respansibility tar tre maintenance of accounting records which may ne relred upon in the preparation at the ntancial statements of the praject, as wel as adequate oftersa intemal fiancial contral Executive Director . |Deputy E xecutive Director.~ Director -BUDS-ERT lit 6 4.0 FINANCIAL STATEMENTS 4.1 Statement of Financial Position Note 2021 2020 2021 2020 USD USD UGX'000 UX@00 ASSETS Non-current assets 51 (c) - - - Current assets Cash and bank 4.5 2 254,802 906,858 ecevabls 4 53 - Total current assets 254,802 39-93 906,858 1 442 674 Total assets 254,802 3901993 906,858 ,42,674 LU4 AND IDKTIES Fund fUnd bailacvGe 4 5 4 254,802 389365 906,858 43 3 Total of fund 254,802 3W :65 906,858 1 436.533 Liabilities Payables 45.5 - 1628 - 60.1 Total liabilities - 1,628 - 6,041 Total fund and liabilities 254,802 390,993 906,858 442, 74 The iaia statements were approved by the Project V]nen t o n. 2021 and vere sgned on is beha by Executive Director Deputy Executive Director . ...... Director - BUDS - ERT 111 .. .. ... ..... . ..... . 7 4.2 STATEMENT OF COMPREHENSIVE INCOME BY DISBURSEMENT CATEGORIES 2021 2021 2020 2021 2020 USD USD USD UGX'000 UGX 000 Note Budget Actual Actua Actual Income (Grants received) DA fundig 4 5<6 543,056 246,000 349 97 905,594 1299 730 Othe Income -E xchan,e a n 33 1 089 (44,341) 3 8 Total funding 543,056 246.033 351 .065 861,253 1313 698 Expenditure P M0 k~cro Hydro Power Plant Dec-velopment 63,408 112.117 101 473 416,096 377.719 !nsltiinal dev~ and formnulaon of strategic plan 49,098 - 36 764 ncrease E RA Certified wiremnen and improv ng business mianagem~ent skil s for electrical contrac:ors 300,000 127,191 47.247 458,951 175 299 Operaional costs 130,550 141,288 118.368 515,981 439 023 Total expenses 543.056 380,596 357 805 1,391,028 1 328 807 Excess of income over expenditure transferred to fund balance (134,563) (5292775) 8 4.3 STATEMENT OF CASH FLOWS Noe 2021 202C 2021 2020 USD USD UGX'000 UG 000 Cash flows fram operating activities Surpius for the year (134,563) ( 740) (529,775) ( 109 Chiange in receivaLes Cian rin accounts p3yables (1,628) 1 §28 (6,041) 6 041 Net increase in cash and cash equivalents (136,191) (5 112) (535,816) ( 6 Cash and cash eqva ents at beginig cf 390,993 396 105 1,442,674 1 461 742 Cash and cash equivalents at end of year 4 5 2 254 802 390 993 906,858 1 442.674 9 4,� 5���1A� AC�OUhiT {SA) ACTIVITY STATEMENT �$C,4prif ��21 - 3Utn Jигь� 2021 , , . . . ..: �� 1, _ . � � G�:�.r. •:�.,:-'-г.,, ��,_:: .��.. �°� р. г . ,.г ,�,.,..ы � i _... ... . .. « .. ___ .- , �.;1 1' 11�11. \ �� 11\ �.. �.�� �И` _ . _ _ ..... . - _ � ..... ......... ..._ 1 11, г.. 1;�.i'�l.� I�.i�i1. �,1 I ,г.г 1 ь .�.II�.�S .� 1 !:1lп .i _ - _ .... ... ...... .... ._ ..... ..-•_____- .... � I. i'.�:i.:,1� 4: 1�� ...__ ' Э _ _ ......_. ....._- .. .... ................... ...... ......... , ... � __ - _.._ ..... ......... ... _ ..... .. ...._ � ._ .. ..,� i�tttгl _ _ _ _ _ _ _ ___ _ _ ... � 1 I.гli'.� , i:i4l'\ Ia ' ' i: � 1 :' '. 1 1 .в i'1 '�{ .._.. ... . ..... . _ _______ . _ _ ..... ..... .., ......... ......._ �� . .......� _____ .. : ( .i-1 i1p.il.�г'; ��'1"i:�:1'iii i". 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I - . . ... .... ___. _ ..... _ .,.... ..... * ..._ � ' : . . .. _ _- __... _..... ..... _ ......_... ._..... ..._ *, ..._ . � . .�. .' ��, '. I.. : . ' � . . . _ _ _....... ..............._ _ . � .; . _ _ - . _ ......._.. _ _ . _ .� I I.'I .____�.т . . 1'� � � . i .гГ�;. ..� � 111- .- I 1� , ;7 4 , NOTES FORMING PART OF THE FINANCIAL STATEMENTS 4,5.1 Accounting policies on 2 modifi,ýr] ýI- iss The J re r- -,, ý ý end (if the j- rei- j:3d paymens reco, ed wnen actualy paic, are expelnsc purchase jflon i, -i n the accounts ýýn, nc,ý j itc the -e tr- !n trý, l." of-v- e Thý I 1ý, are preparu :.,j but also indicating the i in US 7 'ýccojn[ ýs ma S d, l -rs e) -i - urrency rate USD Closing rate 3,559.07 (Extracted from B o U monthly schedules) 2021 2020 2021 21_- - USD USD UGX'000 4.5.2 Cash and bank BUDS-ER 111 IDA Dollar account 231,542 390 466 824,074 1,440Y71: 1 BUDS-ER W UGX accourt 23,260 525 82,784 1954 Cash 2 .............. ---------- .............. ----------- 254,802 390-093 906,858 1 4 5 NOTES FORMING PART OF THE FINANCIAL STATEMENTS 2021 202û 2021 2020 USD USD UGX'000 UGX'000 4.5.3 Receivables 4.5,4 Fund balance Ba:an ce at01 07.2û20 i389,365 6 5 1,436,633 461 742 Add E xcess of income over expendniure (134,563) (6 74() (529,775) (25.108) Fund balance at 30.06.2021 254,802 389 365 906,858 1 436 634 Thes reat to funds rceived ess what has been spenti e the uce balance of the grn. 4.5.5 Payables P,YE Jun 200 328 6041 4.5.6 Funding received nternaioal Deveopment Agen~cy (IDA) 246,000 349 976 905,595 1,343 222 246,000 349,976 905,595 1, 343.222 These represent amounots received from the donor 4.5.7 Expenses Budget 2021 2020 2021 232û 2021 Actual Actual Actual Actal USD USD u sD UGX 000 UGX 00 Expenditure Pico & 'Acro Hydro Power Plan: Dev 63,408 112,117 10 ,472 416,096 277 71g insiut ia. dev. anf forrulati of strategic pla 49,098 0, 718 increase ER?A D~ertifved4 Wremen and improving business rnanagementi skis for lectrica contractors 300,000 127,191 4247 458,951 175 299 Operational costs 130,550 141,288 18 38 515,981 439 323 Total expenses 543,056 380,596 357 805 1,391,028 328 607 12 Government of Uganda Energy for Rural Transformation Project I-(ERT 1i1) PSF Component Cr 56530- UG SOURCES AND USES OF FUNDS Q u arter Cumulative USH USS USH USS PROJECT FINANCING SubtotaI 6.411,416.932 1,747.860 Total Fonds (44 341 091} 33 6100 221,228 1 61.099 Tota uses of funds 330.002.670 91,718 ,493.33,67 1.496.297 etash (374.34 661) (91,681 906 857.31 254,802 Openinci Cash Balanc¯es 15......... -i. h---- --l : l 4 57 Other Items Payables Total 1 281 ,201,192 346 487 Net carb ava,able at end of period 906 5731 254 802 906,867631 254.802 Closing cash balances Total 9 0 6, 857,5 31 254 1 90 5, 531 26 2 13