Ministry of Finance of the Republic of Belarus Republican Unitary Enterprise "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" Special Purpose Financial Statements under the Project "Public Financial Management Modernization in the Republic of Belarus" Loan No. 8606-BY for the period from January 1, 2018 to December 31, 2018 with the independent auditor's report Minsk | 2019 Public Financial Management Modernization in the Republic of Belarus Loan No. 8606-BY CONTENTS STATEMENT ON THE MANAGEMENT'S RESPONSIBILITY FOR PREPARATION AND APPROVAL OF THE SPECIAL PURPOSE FINANCIAL STATEMENTS UNDER THE PROJECT FOR THE PERIOD FROM JANUARY 01, 2017 TO DECEM BER 31, 201801........... ...... . ........... . ..........................3 IN D EPEN D ENT A U DITO R'S O PINION.................... ................. ....-. .... .................. ...... 4 2 Public Financial Management Modernization in the Republic of Belarus Loan No. 8606-BY STATEMENT ON THE MANAGEMENT'S RESPONSIBILITY FOR PREPARATION AND APPROVAL OF THE SPECIAL PURPOSE FINANCIAL STATEMENTS UNDER THE PROJECT FOR THE PERIOD FROM JANUARY 01, 2018 TO DECEMBER 31, 2018 Management of Republican Unitary Enterprise "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" (hereinafter - RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus") is responsible for preparation of the special purpose financial statements under the Project "Public Financial Management Modernization in the Republic of Belarus" (hereinafter - the Project) being implemented by RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus", that present fairly in all material respects the financial position of the Project as at December 31, 2018, as well as funds received and used under the Project for the period from January 01, 2018 to December 31, 2018 in accordance with the International Public Sector Accounting Standards (IPSAS). While preparing the special purpose financial statements under the Project, the Management of RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" (hereinafter - the Management) is responsible for: * adequate choice and application of accounting policies' principles; * presentation of information including that on accounting policies in a form which ensures relevance, reliability, comparability and transparency of such information; * compliance with the requirements of IPSAS and disclosure of all significant deviations from IPSAS in the Notes to the special purpose financial statements under the Project. The Management is also responsible for: * development, introduction and maintaining of effective and reliable internal control system under the Project; * maintenance of accounting in a form that allows to address the substance and explain transactions under the Project, and also to provide information of sufficient accuracy on the financial position of the Project at any date and ensure compliance with IPSAS; * taking all possible reasonable steps to safeguard of the assets of the Project; * detecting and preventing facts of financial and other irregularities. The present special purpose financial statements under the Project for the period from January 01, 2018 to December 31, 2018 were approved by M.L. Yermalovich, the Minister of Finance of the Republic of Belarus, on April 10, 2019. On behalf of the Management of RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus": A.A. Narchuk O,E. Sinishina Director Chief Accountant 3 FBK-BEL LLC Our ref. No. 05-01/168 of May 28, 2019 INDEPENDENT AUDITOR'S OPINION To the Ministry of Finance of the Republic of Belarus, RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus", the Management of the Project "Public Financial Management Modernization in the Republic of Belarus" Opinion We have audited the special purpose financial statements under the Project "Public Financial Management Modernization in the Republic of Belarus" financed by the International Bank for Reconstruction and Development (hereinafter - IBRD) according to Loan Agreement No. 8606-BY of April 1, 2016 between the Republic of Belarus and IBRD (hereinafter - the Agreement) that include Loan Sources and Uses of Funds Statement, Uses of Funds, Designated Account Statement, Transit Account Statement, SOE Withdrawal Schedule as at December 31, 2018 and for the period from January 01, 2018 to December 31, 2018, and explanatory notes to the special purpose financial statements including disclosure of the fundamental principles of the accounting policies. In our opinion, the accompanying special purpose financial statements under the Project fairly in all material respects represent the financial position of the Project as at December 31, 2018, as well as received and used Project funds for the period from January 01, 2018 to December 31, 2018 in accordance with the International Public Sector Accounting Standard "Financial Reporting under the Cash Basis of Accounting" developed by the International Public Sector Accounting Standards Board of the International Federation of Accountants. Basis for Opinion We conducted our audit in accordance with the requirements of Law of the Republic of Belarus of July 12, 2013 "On Auditing Activity", the National Rules on Auditing Activities effective in the Republic of Belarus, the International Standards on Auditing (hereinafter - "ISAs"). Our responsibilities under these standards are further described in the section "Auditor's Responsibilities for the Audit of the Special Purpose Financial Statements" of this Auditor's Report. We are independent of RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" in accordance with the Code of Ethics for Professional Accountants of the International Ethics Standards Board for Accountants ("IESBA Code"), and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. FBK-Beli Limited Liability Company 201-22A Logoisky highway I Minsk | 220090 Republic of Belarus Tel/fax +375 (17) 355 42 23 I E-mail fbk@fbk.by I www.fbk.by TIN 690398039 FBK-Bel LLC is a member firm of the PKF International Limited family of legally independent firms and does not accept any responsibilty or liability for the actions or inactions of any individual member or correspondent firm or firms 4 FBK-BEL LLC PKF Restriction on Distribution and Use This Auditor's Report is intended solely for the use of the Ministry of Finance of the Republic of Belarus, Republican Unitary Enterprise "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" for presentation of information to IBRD on the Project funds received and used. This Auditor's Report is not intended for the use of third parties, and we do not bear any responsibility or liability to any other parties except the Ministry of Finance of the Republic of Belarus and RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" in respect of this Auditor's Report. In case of taking a decision by such parties based on the contents of this Auditor's Report, the third parties are liable for such decisions. Responsibilities of the Management and Those Charged with Governance for the Special Purpose Financial Statements under the Project The Management of the Project is responsible for preparation and fair presentation of the special purpose financial statements under the Project prepared in accordance with the International Public Sector Accounting Standard "Financial Reporting under the Cash Basis of Accounting" developed by the International Public Sector Accounting Standards Board of the International Federation of Accountants and for the internal control system that the Management considers necessary for preparation of the special purpose financial statements under the Project that is free from material misstatement, whether due to fraud or error. Auditor's Responsibilities for the Audit of the Special Purpose Financial Statements under the Project Our objective is to obtain reasonable assurance on whether the special purpose financial statements are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence economic decisions of users taken on basis of these special purpose financial statements. Within the frames of the audit held in accordance with the ISAs, we apply professional judgment and maintain professional skepticism throughout the audit. We also: * identify and assess the risks of material misstatement of the special purpose financial statements whether due to fraud or error; design and perform audit procedures responsive to those risks; obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than that resulting from an error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control system; * obtain an understanding of the internal control system relevant to the audit, 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 internal control system; * evaluate appropriateness of the accounting policies used and reasonableness of accounting estimates and related disclosures made by the Management; * evaluate presentation of the special purpose financial statements as a whole, their structure and contents, including disclosures, as well as whether the special purpose financial statements present the underlying transactions and events in a manner that ensures their reliable representation. 5 FBK-BEL LLC PKF We communicate with the Management and those charged with governance regarding, among other matters, the planned scope and timing of the audit as well as significant audit findings, including any significant deficiencies in the internal control system that we identify in the course of the audit. Head of the auditing organisation: Director A.G. Reneisky May 28, 2019 Audited organisation: Republican Unitary Enterprise "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" (RUE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus") 17, Kalvaryiskaya str., Minsk, 220010, Republic of Belarus; State registration: was registered by the Minsk City Executive Committee on June 30, 2000 in the Unified State Register of legal entities and individual entrepreneurs under No. 100049849; Taxpayer's identification number - 100049849. Auditing organisation: FBK-Bel Limited Liability Company (FBK-Bel LLC); office 201, 22A Logoisky highway, Minsk, 220090, Republic of Belarus; State registration: was registered by Minsk City Executive Committee on February 6, 2009 in the Unified State Register of legal entities and individual entrepreneurs under No.690398039; Taxpayer's identification number - 690398039. 6 APPROVED ВУ! У`ГПЕРЖДАК➢ Miпister о£ Fitzattce oftlte RериЪ]ic оГВеlагиsl Миниотр<�ьинансов Р "олнки Беларусь ��� � . Мг. Maksitn L.Yвrvrвlnvic9t! ' мвлоаи�� ��, �' �.'�.°"��-2oi�� PUBLIC PINANCIAL MANAGEMENT MOOERNI�.4TtON PRQJECT ! Праект"Мадарнизациа системыrуправлениигосударсrвениыми финансами в Fеспублике Беларцсь" Loan 5ourcos and Uses оГ Funds Statement ! Отчет о5 источникан средств Проекта и их испильзавании 1BaD 8666б for thв Pвriod from б1141l2б18 l0 3�М212418 за период с 01141/2б18 по 3i11212бд8 in ЦSi11в долпараи CttlА Reporting parlodd Отчетный Qpeniпg cash 6afancesl qстаток денвжных средств на начвпо пвриода пв иод TpTAL PER LAIИroro � Cesignated ассвипt - LоаП fundS / Спеунальныiй еыдепенныiй счет - � �� С в ства аайма . 5 2б5 04 Transit acceunt - Loan funds ! Тренэитныiй счет �� С�е стаа ааймя 1,gg � Tota1 openlпg�eaжh�bataиeol�Итого остатокдеиежиь[к ередств на � иачало пе иода . 5 2Б6,28 � 5euaces оГ Funds 1 Источниьси средств � �� � - 16R� 8ВОSи �� � .. 1 1$6 618,64 � � 1 б дб4 p44,t70 . Otherl гие . 0,06 � Totat Flnancfn f Итоrа по источнинама вдств 1 186 618 fi4 '(4 440 0{i0 б0 ... �Less: Expendltumes Ьц Сотропеп[s ! Расходь[ по кемпонентам �� �� Сотропвn( пв.L gudgel management гegulation5 and proceduras 7 � � �� КомпонвнтРh 1:Совершенсrвовамиа п�iавил и процедур упраадения Бюk>катвм 4б3 386 31 4 159 185,8$ Сотропепt по.2�, PFM 1Т solulicns 1 Кампоwент N_ 2: tl�ешения е о6лаеrн �� � - ин в ма ионных технолоеий для УГФ 402 416,48 4 614 5бб,40 Сотропеп[ по,Э: Chaпge Management Г Комnонемт Na 3: Управление � � изменаниями 310 344,12 1 201 348,12 FRONT ENt7 FEE 7 Разоеый с6ор ��� � 4.4Q 25 бОб,4Q . Total�Ex enditures 141тога асиоды по кожпонвнтам 1 1�16 346,91 � 'f�4 446 40б,бб �� lntereat еагпвд 1 Проценты.банка �_ � 6 44 � . Cfo::ing Cash Balances рег ®ank 5taEements Г Сlстаток деисжнык средств ха � коивц оrчетного пе иода по банковским выписьсам Qesigna[ед ассдипl- 16RD poan 1 Специально вьит,епанньэй счет- 16R� ��� -�� займ 75 535,14 . О,бб Transil account - Lоап funds ! Т анаитный ечет�нстачники с� едств 2,81 0,06 . Funds in [ransft 1 С е ства а п ти � � �� Tota1 closing Сазh 8аlапсва д�Итаго остатnк деввжнь[х среджта на � �конец па � иода . 75 544,41 �... ОАб Саlсиlа(ед ассоип( closiпg Ьаlапсе! РасЧитанный бапанс саета на конец отчвтногв � �� пе иа� 75 544 41 4,44 А1,п�сед Uy 1 Cornacosano: , !*л r ., f) Firs1 Deputy Minister of Finaпee of ilie RepaaЫic of Belarusl Пераый �амссхитсль Миниrгlта финансвв Респубпики Gеларусь Мг. Yuriy М. 5cliцerstov/ Ю.М. Свлииеротоа Не;ьд af (iтс Пeparhnext of Financial, Econorxio Activity attd Accoгmtitr$ of гhе Miиisxy о£Е'inance of the RapuЫie п£Веlаптsl На=пигьник уираиленна финанеоs, учета и отчетнвоти уЛ Миttистирстаа финаисов Рсонублики Беларусь / f' п`Г . f'�!' � Ms. Laпsa А. Eнxakova/ Л.А. Грмаквиа t � Нсад ef Гiпwacial Techxвlogies Deparnaaent oflhe Mittistry о£ Firr.�tncu af the RepuUlfc of Belaгvs/ � Начаа[ьник уирашгения финансоаык геиьюдогий Миписгерстsа ыьинанеов Реепубдики Беларусь Мг, rLtdrey А. Narclxгkl А.А, Нарчук licputy Direcror af IZUE "llata-R ocessing Ccnter of tlte Ministry af Finaпce о€the RcpuЫic of Belarus"/ Заместитель дирсктора У[ I"ИВЦ Минфина" Мт, Witali А. Boika! В.А. Бвiiко Неад Of Accountin� Qepariment of RUE "Пa1a-Prosвssiиg Сеп[ег af tlae Ministry of Рiпапсе of 1Ье RepuЫic о£бeiarus"1 � � Глаинььй fiyxrurтep УЛ "И8Ц Минфина,� �` ,� Ms. �1ga Е, Siпishiпa/ О.Е. С'ииишииа . .4f�4..�� -...% в"' APPR4VED 11У 1 у'I'$ЕРЖ�;;АIр Ministcr af Finance of the RepnЫic af I3etaгцs/ Мигтсгр фина о Республики Беларусь .г°f'С� Mr. Maksim L.Yeлnalovich! ] ,�лг'� М.Л. Нрдtоливич „�/ :" � 2D19 г. PIJ$LIC It'Е]VANCIAL MANAGF.MI.NT М{)DERIYIZATI4N РА(iJE�"Т' f ёI э0ект "Молс низация системы л аиленин rосула стпенгьымн инаисамэнп Ресл блике Белл 1 сг," Uses nf Funds 1 ртчет о гасходпианигг с аедстн П гоекта I$RD $6060 fOr tlье Period Fэroгп 01lО112618 fo 3 111 212 0 1 8 in U5D1в долла ах США эа пе >иод с 01/(}112б18 лп 31/12l2018 Projeet exlrenditureslУпсходы пР0екта � Cumulative 1о дяlе! `�°'о[дгь рпулЫе at [he reporling 'fotal Атоип( рег дяfе (goodslseьwiгes лгпрtед but Prajecr согираггепtl5upcomponerllAetivity/Компанеит prprurement рlяиlQbman Уеяr to дяtе{i'ек Рисхоиы с Тпtа] рнутепtч sfin го Ье ущнй нярпстаюииьм поь paid)ГКредыторскяп ировктяlиодиоюпонеитlмероириптие сумпгасоглясир пллну гол тяде/Осъ�лтокерелстнэгдн итвгам ца }�вдп�инноrrь ня пrчетиуго - зпкугтк лпту (твипрыlуслупг црёдетвsьших илатежеiг от�reтнугр дяту ирнинтыа, во ие рпnяченные) . .. . -� г .. 2 Э .. 4 � � S=L-3 Спнгра.пеnlrгиl:Впгigеlигипаgепгепirеgпlпllапапд . � � � � ргпСегLгrеs�Р•аvгепиеr.гпа:йliгСпаерггrсиг;п:гоеагrгьепрааилп � � . iгpvrishYPуrграычеипи Бюйsrcеэпам �� � �� � J t54185,К8. JD3 Я88,З! . 7J2 TJ7,J0 � . . . � . .. . l388цG,0!! 3J16J.P8,dR .. . SиЬ-Gг.прпг[епtпаl.I:Ппдgеlрrераrаппгг/ . . � . . � . . . . . � 17пbнцчппrгеггт 1'sl.l; Лпдтогплаив�бгпдахsпш � � l5ц?I5Ф,50 21J7535,З3 7l13tЬ7,12 ��.. � O,UO 137Ч Т83.З8 1.1. L. Мясгоесопптге агiд тасго fscal forecasfine! � . Макрозкnномическое н мак пгlискяльное п�огнози ование 634 009 00 0,00 0 00 .. 0-00 G34 00),Ор . 1,L2. Rецсииеforecas�tin �1П огнози пвиинелохадоа 22181р,рр ]З27I5q 33271,50 � �� _ .. q9p�� 188578,50.. L 1.3. Тан ех епдi[игеsl0иенкд налпгриын �лсходоn . 1 SO рр0 00 0,00 0,а0 � � � 0 04 l50 Ор0,00 1.1.4_ Mcdium lегт апд program Ьudgelmg 1 Срепнесрочное и н ог�амльнл-дсленnс пллни ппяние бьоцжетя 9..80 Bt5,50 I74244.64 174244,64 _ . � . O,OU 406 570,86 1., 1,5. О еглгiипаl ек}eпses 1 Олерационные �асхоиы 5 51 G р0 l9 21 4 R50,98 .. . . . . . . . 0,90 Бб5.02 5'п!л-С'ппуiпиеаtггп.l.2: l7eGlmrrrгядafnenU � . Гlадиахгагwrигпл.l;г1.2: Упраетеrгпедгцгzцн SS�1,ПП- ,(81,1: 5i3,93 � . .. . О,ОП� Г1�ОТ _. � 12.1. lтргпчетеиt oFthв debt mana6ment sysfem 1 Соие игенсгновашге п ааленияцолг_ом 0,00 000 000 � 4 00 D.00 1.?, Z, 9 erяtipnal ен � enses Г дие аиьsонныс ас�хплы . . 554 ОП 484 12 3 53,93 .. . . 04р� р р7� . Sл(.Сппгрппеггt ип.f.3: Гfuгiget с;тесгггiпл шаьl герипlп8! � . Ппдь�и.игоггспт Лд 1.3: Негап;пгеггие бюджеапа и апечеигггасть � 2 566 48L,3R iцS 9бб,%1 � 519 836,35 - . 1З88цб,f10- 20З6bj5,UЗ� 1 3 1, 7тргоцетеnг oF 6udget exeemion / Совеgгиенчтвоианлс �� -� � ислаьпениа.бюджета 350 OOD Ор 0 00 - _ . 0,00., 0. рр З 50 Орр,00 1,3.2. Accauuiпg апд iinancial reportinp/ Нукгалтереюгьа уч:ёт и � � �-� инанспвая сrгчехность 9В7 [90,00 86 844 00 � 86 844 Oq 57896.00 900 3 Ms. Larisa А. �гтдknчл,' I1.�!,. Ерлгакрпа Неад af Firraпcial Teclrггologics pepartment � of the Minislry of Сiиапсе uf thc Repгrbiic pf Helanгs/ [Iп�гальник управпении финаысонг,гк теwгологи� Миггистерства сjгигганспв Леспубдики 5сларусь Мг. Апдгсу А. Narclгuk/ А.А. Нарпук Depn€у bireetor vf RUE "L7aЬa-Prncessin�; Cexter ofliгe Ministry of ]гinance of гЬе КерпЫiе e�f Baiafirs'Ч 3апtестхrель дгиректора УП "ИВL1 МинсСахка" Мг�. Vitali А. Boika! В.А. Бойко Неад Of Accиuncing Depaпment of RUE "C�ata-Prncessing Center of the Miiьishy о£ Finaoce оР the RepuЫic ор Веlагдгs"1 �J i Слааныи б хга,пте УП "ЙВ Мин rхна" '" i � У р � � �r�,е Ms. O1ga С:. Sinishina! р.Е. Синишина Z �L-i-- _ „i' f' APP�tOVFD ВУ 1 У°['ВL.рЖ)[ЛIр Miaister of Finaaice ofthe Repul�lic of Belлrlrs/ Министрг�ииансон У н�iлики Беларусь . Гl�,:ы� � � aksirn P,.Yerrпalovidil � М�.J�ц авиц " ��� 2б14г. PUEILIC �1NAMCfAL A1UqGEVцIENT MOLtERN1ZATfOЛJ PR4JECT 1 fipoeкr"Модернwзация системь[управления государствонными финвмсами в Рёспублике Беларусь" Transik Accounk Statement ! Отчет о состоянии транзитнАго Счета 1BR© 86060 for the period from 011011201$ #о З111212018 за период с 4110112oi8 по 3 1 11 212 01 8 in USDГвдолларак СС11А OpenPng balance as of 01.01.2418, including lОстаток денежных средств на начало Rеропт9 РеriодlQтчетный nериод 1 отчетного nериода 01.01.201$, включая Loan funds 1 Gредства Займа 2�®г Pnterest еагледlпроцвнты банка 1�28 Advance from DA during the реriодlСумма авансов, посryпившая со слецwально 0��4 2 выделенного счета 782 046,72 Amouni of efigiЫe oжpenditures paid durint� tha present регiодlСумма 3 санкуионированных раехадов оплаченн:iя в отчетном периоде 782 045,09 4 Refundslвозмещение на спеуиально выделенный счет 5 lnterest еагледlпроцонты бамка O,DO 6 Serцice сhаrgе5lСтоимость услуг 5,66 7 Differences arising in the ге orfin 4,44 р g periodlРазница, возникшая в оrчеrмом периоде $ Catculated closing ЬаlапсеlРасчитаиный остаrок денежных средств на транзитном ечете 9, 31 9 DA closing balance as of 31.12.2018 carried forward to next period - per bank statements, includ'rng 1Qстаrок денежных средств на 31.12.2018 на транзитном счете, перенесенный на следуго[ций отчетный лериод - соrrгасно вt,тиске бамка, sключая 9,З1 Loan lunds 1 Средстsа Займа 10 Pntore$1 еагледlпроуенты Банка 2,91 [?ifference between 8 and 9lРазнгn а ме 6,40 ц иWу линиями 8 м 9 0,40 (should be zero or ехрlаiлед/должма быrы равна нулю или объяснена) Explanation of апу tlisсгерапсуlрбъяснение пюбых раэниц ипи несоотвеrствий: Agrecd bY ! Согласооано: First Dcputy Minister aF Fiиauce о[�[]ie RcFэuЫ ic of Helanrsl � Нерный sамсститель Министра фиггансов Уеспублики Беларусь - Mr. Yuriy М, Seliverstov/ Ю.М. Селиверстов Нгад ot'the Departmeиt of Fiиaneial, Econmztic Actiwity апд Accouutin#; of tlre Miпistгy of Finaцce oFthe RepuЫic о£ Belarus! fiачаnьньзк управленин фиггагзсов, учета и ртчетности 7 Минисасрсгва финаисов Ресагу5лики Бслаl�Усб /','� � i г4 ��/`r'� Ms. Larisa А. EnпakovcV TLA, Ермакона Неад oFFinanciaf Techгrotogics Depaftиient ofthe Miиislгy oFFй7ance о£[Ье RepuЫic oFF3elarusl Начальник улранления �инансовых технологий Минхотеретеа фиианеов Ресиу6лики bслдрусь Mr. Апдгеу А. Лfагс]iuk/ А,А. Нар�гук Dcputy pirector aFRUE "Data-T'rocessing Ceпter of thc Miпistry of рiпаисе of the Rcpu6lio о£ Веiапгв"! Замесrительдирекгрра 3'CI"ИВI(Миьде�гигга" ���у��� Мг. Vifali А. FЭoika! В.А. Байко Неад Of Aecountin� Departmcгv of12 UE "pata-Processing � Ceutcr of fha Ministгy of Finлnce oEths КepuЫic of Belarus"/ � Главиый бухгалтер УП "ИВЦ Минсрина" ���� �� � Ms, С)1gд Е. Sinishina/ б,Е. Синиигина 「l찧누 Explanatory notes to Financial Statements of the project named "Public Financial Management Modernization in the Republic of Belarus" No 8606 for 2018 1. General information The International Bank for Reconstruction and Development has allocated a loan to the Republic of Belarus represented by the Ministry of Finance for implementing the Project "Public Financial Management Modernization Project" (hereinafter referred to as "the Project") under the terms set out in the Loan Agreement between the Republic of Belarus. and International Bank for Reconstruction and Development dated I April 2016. The Project is approved by the Law of the Republic of Belarus dated I I July 2016 No 390-3. The Project supports implementation of the Public Financial Management Reform Strategy (hereinafter referred to as "the Strategy") approved by Resolution of the Council of Ministers of the Republic of Belarus No. 1080 of 23 December 2015. The Strategy is consistent with the World Bank Group Partnership Strategy for the Republic of Belarus for 2014 - 2017 and supports enhancement of transparency of public finance. Development of Public Financial Management is one of top-priority goal of domestic policy of the Republic of Belarus, The reforming of this System shall improve public financial management by enhancing the methodological, informational, technical, technological and analytical approaches to planning, execution and accounting of the public finances at all levels of the budget system of the Republic of Belarus. The total Project funding is 10,000,000.00 USD. The Project consists of three Components as follows: 1. Budget management regulations and procedures. 2. PFM IT solutions. 3. Change Management. In conformity with Loan Agreement dated I April 2016 and the Order of the Ministry of Finance of the Republic of Belarus dated 19 July 2016 No. 211 "On implementation of the "Public Financial Management Modernization Project" RUE "Data- Processing Centre of the Ministry of Finance of the Republic of Belarus" has been assigned as a project implementing agency. UE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" keeps accounting records and primary documents regarding the funds transferred to its accounts. Financial management for project funding has been conducted in line with the following guidelines: -World Bank Disbursement Guidelines for Projects dated I May 2006; -International Bank for Reconstruction and Development General Conditions for Loans dated March 12, 2012. -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. -Loan Agreement and Disbursement Letter dated April 1, 2016, established special procedures for the Loan funds use. -Order of the Ministry of Finance of the Republic of Belarus dated 19 July 2016 No. 211 "On implementation of the Public Financial Management Modernization Project>>; Project Operational Manual. Public Financial Management Modernization in the Republic of Belarus Loan No. 8606-BY 2. Accounting policy Fundamental accounting principles - the present Financial Statements of the Project are prepared on a cash basis, which complies with the requirements of International Accounting Standards developed by the Public Sector Committee of the International Federation of Accountants (IFAC). A project financing is deemed to be a source of the project's funds at the moment of receipt of funds. Project costs is deemed to be an application of project's funds at the moment of payment. Foreign currency transactions - the present Financial Statements are prepared in US Dollars. Transactions in other currency are transferred in US Dollars at the actual currency rate. Reporting base - the present Financial Statements are based on the accounting documents of UE "Data-Processing Centre of the Ministry of Finance of the Republic of Belarus" and separate accounting records of Project assets . 3. The World Bank Funding The Project Designated Account is replenished by the World Bank based on Withdrawal Applications authorized by representatives of the Ministry of Finance of the Republic of Belarus. During the reporting period the financing was conducted to the Project Designated Account via advancing modality and direct payments. 4. Bank Accounts of the Project Project Bank Accounts are opened at OAO "ASB Belarusbank". a. Project Designated Account in US Dollars The Project Designated Account No. BY39AKBB36200206204066000000 has been opened in US Dollars. The outstanding balance of the Designated Account equals USD 75,535.10. b. Project Account in Byelorussian Roubles (transit account) The Project Account in Byelorussian Roubles No. BYO2AKBB36200206203056000000 has been opened for US Dollars conversion in Byelorussian rubles to make payments to national consultants and contractors. The outstanding balance of the Project Account in Byelorussian Rubles equals BYR 19.97, including bank interest to be transferred to the national budget of the Republic of Belarus, in the amount of BYR 13.83. 5. Foundation of financing Project funds may be withdrawn to finance 100% of eligible expenses, consisting of Goods, Non- consulting Services, Consulting Services, Audit, Training, Operating costs inclusive of Taxes. Public Financial Management Modernization in the Republic of Belarus Loan No. 8606-BY Reconciliation of the project funding and actual expenditures Withdrawal applications Expenses incurred from I January 2018 to 31 December 2018 1,116,346.91 Total expenses incurred from 1 January 2018 to 31 December 2018 1,116,346.91 Funds received from IBRD from I January 2018 to 31 December 2018: 1,186,618.64 Replenishment of the Special Designated Account 925,530.00 Direct payments 261,088.64 Plus: Balance on the Special Designated Account at 1 January 2018 5,265.00 Plus: Balance on the Transit Account at 1 January 2018 1.28 Minus: Balance on the Special Designated Account at 31 December 2018 75,535.10 Minus: Balance on the Transit Account at 31 December 2018 2.91 Total expenses incurred from I January 2018 to 31 December 2018 1,116,346.91