RUE (Minskavtodor-enter FPlanl statements of tB (Transit Nrrior Imrovement) #845 BY for the year endei 31 Iecmer 2018 CONTENTS INDEPENDENT AUDITORS' REPORT 3 STATEMENT OF PROJECT SOURCES AND USES OF FUNDS FOR THE YEAR ENDED 31 DECEMBER 2018 5 DESIGNATED ACCOUNT STATEMENT FOR THE YEAR ENDED31 DECEMBER 2018 6 TRANSIT ACCOUNT STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2018 7 USES OF FUNDS STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2018 8 NOLS 10 IHLHNANCIALSIAILMENTS 10 flUSe []EHeHI AUMto-S'ReoQJt To the chief accountant of RUE > Independent Auditor's Report Page 2 In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Auditors' Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' 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 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 the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and 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 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 are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by 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 Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Company to cease to continue as a going concern. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. The engagement partner on the audit resulting in this independent auditors' report is. Vasyl Pavienko Audit Director 21 June 2019 Information about the Auditor: Name: Limited LialtilityCompany clKPMG and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (.KPMG Intemationai,). a Swis entity Location: 220012. Republic of Belarus. Minsk. Platonova street 49 7th ficor, office 26-7 State registration: Certificate of State registration issued by the decision of Minsk City Executive Committee dated 10.02.2011: Registration No, in the Unified State Register of Legal Entities and individual Entrepreneurs NQ191434140 RUE ulMinskavtodor-Centern Statement of Project Sources and Uses of Funds for the year ended 31 December 2018 (in USD) Actual For the year ended Cumulative total 31 December 2018 amount Total funds Opening Cash Balances Designated account OJSC "Belinvesbnk" -~ USD 0,00 Transit account 0,00 Other accounts 0,00 0,00 Sources of funds: World Bank loan 81.601.000,00 171.579.234,00 Other 18,67 18,67 Total Financing: 81.601.018,67 171.579.252,67 Project expenditures: Part 1: Improvement of Settons of M6 Tranit Corrdor /9 901 W /, A 16 / / /9 Ub,9 / / '19 776 000,00 Part 2: Hoad Satoty and Network Management 396.921,66 658.681,59 6.800.000,00 Part 3: Border Management Enhancement 2.382.055,20 2.496.526,00 3.300.000,00 Part 4: Front-end Fee 0,00 625.000,00 625.000,00 Total project expenditures: 81.580.324,36 171.558.558,36 250.000.000,00 Closing Cash Balances Designated account OJSC "Belinvestbank" - USD 20.675,64 Transit account 18,67 Differences arising in the reporting period 0,00 Chief Engineer Chief accou ant Isakov S.S. Labkovic A.V. The notes on pages from 10 to 11 form an Integra part of hi financial statements. 5 RUE aMinskavtodor-Centern Designated Account Statement for the year ended 31 December 2018 (in USD) Bank where the designated account was opened OJSC "Belinvestbank" Loan # 8459 Currency USD Account # 3620000083834 OPENING BALANCE 0,00 Proceeds: Funds received 81.601.000,00 TOTAL FUNDS RECEIVED 81.001.000,00 Deductions: expenditures Arnount of expenditures paid during the reporting period 332.0/8,09 Arnount of funds tirisforted Lu Lie LidiisiL d ount 81.248.162,86 Service charges 83,41 TOTAL EXPENDITURES 81.580.324,36 CLOSING BALANCE 20.675,64 Chief Fngineer Chiefacc Lant Isakov S.S. Labkov A.V. The notes on pages from 10 to 11 form an integral part the financ a statements. 6 RUE uMinskavtodor-Centeri Transit Account Statement for the year ended 31 December 2018 (in USD) Bank where the transit account was opened OJSC "Belinvestbank" Loan # 8459 Currency BYN OPENING BALANCE 0,00 Proceeds: proceeds from designated project account 81 24R 162,86 Other 18,67 TOTAL FUNDS RECEIVED 81.248.181,53 Deductions: expenditures AnouiL o[ uxpiidi[u es puid dui rig Lh eupo iiny puniod 01 .210.1 62,06 Interest accrued 0,00 Service charges 0,00 Differences arising in the reporting period 0,00 TOTAL EXPENDITURES 81.248.162,86 CLOSING BALANCE 18,67 Chief Engineer Chief accounta Isakov S.S. 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С'`} U i3i у р ©rrлл о�.о' го ъ� ®°� а� с� ° У.о 9 С (Л � � � т С �.. ц га О СП � О LL ti W а . т га � р U : т V ro 4 ? i�j � г� 4� � 1� ct � [+э с0 4 сд ro � al � � Q � � � � � � c�i �''i �h ,С г�о " гV ""� гз т ' О � ' U � �ь, +J � .. . t1 г�i ' N �'v N 1� CL в'i �'7 �'') F- Ci � 1- U � � RUE "MInskavtodor-Center.,) Notes to the financial statements For the year ended 31 December 2018 (All amounts determined in USD if not otherwise stated) Project information The objective of the Project is to improve transport connectivity in the Republic of Belarus, border crossing procedures and safety for domestic and international road users on selected sections of the M6 Corridor, The Project consists of the following parts: Part 1: Improvement of Sections of M6 Transit Corridor. Reconstructing and upgrading selected section of the M6 Corridor through, inter alia: a) Carrying out of widening works(from a two lane road to a four lane road) in selected section of the M6 Corridor between the cities of Minsk and Grodno for approximately 86 km in the aggregate; b) The installation of central crash barriers, side barriers, bus stops, road sign and marketing along selected section of the M6 Corridor; c) The improvement of vertical alignments located in selected sections of the M6 Corridor; and d) The carrying out of: W the technical audits for the activities mentioned under Part I (a) to (c) above; and (ii) the Project financial audits. Part 2: Road Safety and Network Management. Strengthening traffic management and road emergency response in the Republic of Belarus through, inter alia: a) The establishment of a Traffic and Road Safety Coordination Centre(TRSCC) through, inter alia: W the preparation of the technical design of TRSCC and the necessary bidding documents for its establishment; (ii) the provision of consultant's services and Training; (iii) the development of the necessary monitoring and evaluation mechanisms, through, inter alia: (A) the design and implementation of a road users' satisfaction surveys; (B) the carrying out of impact evaluation of road sector interventions; and (C) the carrying out of road safety awareness campaigns; and (iv) the provision of ICT systems, b) W The design and implementation of a market survey on road-side services to identify user needs and private sector interests in transport sector of the Republic of Belarus; and (ii) the review of regulatory framework for the development of road- side services based on a market-oriented approach in the Republic of Belarus. Part 3: Border Management Enhancement. S Itrengthening border management capacity in the Republic of RelarLIS and facilitating the. movement of gross-border trade at the Bruzgi border crossing point, through the re-design and implomontation of the physical layout of vehicles control, processing and examination areas, through the provision of works, goods and consultants' services required therefor. 10 RUE mMinskavtodor-Centerm Notes to the financial statements For the year ended 31 December 2018 (All amounts determined in USD if not otherwise stated) Significant accounting policies. Basis of accounting Financial statements have been prepared in accordance with the Loan Agreement 8459BY with the World Bank and in conformity with the World Bank's Financial Management Sector Board's "Guidelines: Annual Financial Reporting and Auditing for World Bank-Financed Activities". Accounting policies were used consistently during the whole year of the Loan use. Accounting data of RUE "Minskavtodor-Center" form the basis for the financial statomonts proparation. Tho projoct transactions rocordod soparatoly from tho funds received from other sources of finance of RUE "Minskavtodor-Center". RUE "Minskavtodor-Center" keeps its records and prepares its financial statements on the case- hased method Cash inflows are recogni7ed at the moment of cash inflow from the World Bank. Expenses are registered at the date of withdrawal from the special accounts of the Project. Reporting period This report covers the period of use of the Loan funds for the year ended 31 December 2018. Functional currency and financial statements currency The national currency of the Republic of Belarus is Belarussian ruble and this currency is the functional currency of the Project. In accordance with the requirements of the World Bank USD is the currency of the financial statements. Payments made in Belarusian rubles are presented in the financial statements in USD at the actual bank exchange rate at the date of foreign currency sale. Funds of the project financed by the World Bank The World Bank provided Project funds upon requests signed by the authorized representative of RUE "Minskavtodor-Center". In the reporting year, financing provided by additions to the initial advance to the special account of the project opened in OJSC "Belinvestbank", as well as by direct payments. Project accounts Project accounts opened in OJSC "Belinvestbank", which comply with the requirements of the World Bank. Special foreiqn currency account of the project NL BY56BLBB36200190638747001001is opened in USD. Budgel plujecL accouiiL NL BY29BLBB36200190638747001002 is opeiied in BYN. This account is intended for depositing the ruble equivalent of sold currency from the special foreign account. Determination of earnings and expenses The following table shows the Categories of components to be funded under the Loan, Loan allocations for each Category and the percentage of costs of components, which will be financed in each Category: Category Amount of the Loan funds Percentage of costs to be funded (net of taxes) (in USD) (1) Goods, works, trainings and consulting services 249,375,000,00 100 % The amount payable under the provisions of Section 2.03 of (2) Front-end fee 625,000.00 Loan Agreement pursuant to Section 2.07 (b) of General Terms TOTAL 250,000,000.00 11 World Bank Audit Documentation Checklist Additional information (unaudited) Name of Loan/Credit: World Bank Loan/Credit # 8459-BY Auditors' Report: June 21, 2019 Check if Check if Included N/A 1. Auditors' Report (Opinion): A. Applicable accounting standards noted X B.Applicable auditing standards noted X C.Opinion rendered on all forms of withdrawals: 1. Statement on use of funds by Project components for the year ended 31 December X 2018 2. Designated account X D.All sources of financing for the project are noted X II. Financial statements: A.Revenue Earning Entity (all items are to be filled-in): 1. Balance sheet X 2. Cash Flow Statement X 3. Income Statement X B.Non-Revenue Earning Entity (all items are to be filled-in): 1. Balance sheet X 2. Statement on use of funds by Project X components C.If applicable (refer to Loan Agreement): 1. Statement on use of funds by Project components for the year ended 31 December X 2018 2.Statement on use of designated account X Ill.Notes to the financial statements X IV.Reconciliation between World Bank records and project records V.Management Letter x 〕I 〕馴 〕‘ 〕• 〕• 〕‘ l& 〕， 一‘ 抽 夠 lI 灣粚舟ages! . 勵 I 跑 . 馳 觔 飽