Ref No. 2018/19( 2074/75)- 623
Date: 15 March, 2019
Independent Auditor's Report
The Secretary
Ministry of Finance
Singh Durbar, Kathmandu.
Report on the Finance Statements
We have audited the accompanying project Financial Statement including Designatcd Account of the " Nepal Pilot
Program for Climate Resilience: Building Resilience to Climate Related Hazards (BRCH) Project " financed by
IDA  Grant TF 13665 NEP, as at 16 July 2018 (32 Ashad. 2075) and for the year then ended and a summary of
accounting policies and other explanatory notes.
Management's Responsibility for Financial statements
Management is responsible for the preparation and fair presentation of the Financial Statement of the project in
accordance with the Government of Nepal (GON) accounting Policies and relevant practices. The responsibility includes:
designing implementing and maintaining internal control relevant to preparation and fair presentation of project financial
statement that are free from material misstatement, whether due to fraud and error.
Auditor's Responsibility
Our responsibility is to express an opinion on this Project Financial Statement based on our audit. We conducted our audit
in accordance with tie INTOSAI (International Organization of Supreme Audit Institution) Fundamental Auditina
Principles. Those Principles require that we plan and perform the audit to obtain reasonable assurance about w.hether the
financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material
misstatement of the financial statement, whether due to fraud or error. In making those risk assessment, the auditor
considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the
effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made by management as well as evaluation the overall presentation
of the financial statements. We believe that the audit evidence we have obtained is sUfticient and appropriate to provide a
basis for our audit opinion.
Opinion
Managenient letter highlighting areas for improving financial management including compliance with financial covenant
is attached herewith.
In our opinion, the project Financial Statement including Statement of Designated Account, in all material respects. give a
true and fair view of the financial position of the "Nepal Pilot Program for Climate Resilience: Building Resilience to
Climate Related Hazards (BRCH) Project " financed by IDA Grant TF 13665 NEP" as of 16 July. 2018 ( 32 Ashad.
2075). and of the results of its operation and its cash flows for the year then ended inl accordance with GON acCOuilting
policies. We also report that Finds provided under IDA Grant No- 13665 NEP have been utilized for intended purposes.
In addition, with respect to statement of Expenditure. a) adequate supporting documentation has been maintained to
support claims to donors for reimbursement of expenditure incurred: and b) expenditure are eligible for financing under
the above mentioned IDA Grants.
(Baburam Gautam)
Deputy Auditor General