HAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT AUDITED FINANCIAL STATEMENTS AND MANAGEMENT LETTER For the fiscal year 2015 HAI PHONG, JUNE - 2016 HAIPHONG URBAN TRANSPORT DEVELOPMENT PROJECT Credit No. 4900-VN TABLE OF CONTENTS CONTENTS PAGE PART I: FINANCIAL STATEMENTS STATEMENTS OF PROJECT MANAGEMENT UNIT 2-3 INDEPENDENT AUDITOR'S REPORT 4-5 FINANCIAL STATEMENTS Balance sheet 6 Summary of Sources and Uses of funds 7 Statement of expenditures by sources 8-9 Statement of designated account 10 Statement of Loan withdrawals 11 Notes to the Financial Statements 12 - 17 PART I: INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER 18 FINANCIAL REPORTING PART III: INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE 19 PART IV: MANAGEMENT LETTER 20-26 SECTION I FINANCIAL STATEMENTS TOl HAIPHONG URBAN TRANSPORT DEVELOPMENT REPORT OF PROJECT MANAGEMENT UNIT PROJECT - Credit No. 490-VN for the year ended December 31, 2015 REPORT OF THE PROJECT MANAGEMENT UNIT The Project Management Unit ("the PMU") of Regional Transport Works of the Department of Transport, assigned by the People's Committee of Hai Phong as Employer Entity for implementing Hai Phong Urban Transport Development Project ("the Project"), presents this report together with the Project's audited Financial Statements for the year ended December 31, 2015. The PMU The members of the PMU, who held office during the year and to the date of this report, were - Mr. Vu Duy Tung Director (Appointed on Februaryl9, 2016) - Mr. Pham Duc Hieu Director (Resigned on February 19, 2016) Mr. Phan Viet Dien Deputy Director (Resigned on February 04, 2016) Mr. Doan Xuan Dan Deputy Director (Appointed on February 25, 2016) - Ms. Dao Nguyen Nhung Chief Accountant The PM4U's responsibility The PMU confirms that the Financial Statements of Hai Phong Urban Traffic Development Project, namely, the Balance sheet as at December 31, 2015, and Statement of sources and uses of funds, Statement of expenditures by sources, Statement of Designated account, and Statement of loan withdrawal for the year then ended and the Notes from page 06 to page 17 (collectively referred to as the "Financial Statements") give a true and fair view of the assets, liabilities and resources as well as the fund received and disbursed of the Project for the year in line with the accounting policies presented in Note 2 of the Notes to the financial statements and relevant covenants of Financing Agreement for the Credit No. 4900-VN dated May 31, 2011, Amendments of Financing Agreement dated September 17, 2014 and June 09, 2015 between the Government of the Socialist Republic of Vietnam (SRV) and International Development Association (IDA). In preparing the Financial Statements, the PMU is required to: Select suitable accounting policies and then apply them consistently; - Make judgments and estimates that are reasonable and prudent; - State whether applicable accounting principles have been followed, subject to any material departures disclosed and explained in the Financial Statements; and, - Design and implement an effective internal control system for the purpose of properly preparing and presenting the Financial Statements so as to minimize errors and frauds. The PMU is responsible for ensuring that proper accounting records are kept, which disclose, with reasonable accuracy at any time the financial position of the Project. The PMU is also responsible for safeguarding of the Project's assets and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 2 HAI PHONG URBAN TRAFFIC DEVELOPMENT REPORT OF THE PROJECT MANAGEMENT UNIT PROJECT Attached to the Financial Statements Credit No.4900 - VN for the fiscal year ended 31/12/2015 REPORT OF PROJECT MANAGEMENT UNIT (Cont.,) The PMU confirms that it has complied with the above requirements in preparing the Financial Statements. F n behalf of ANAGEMENT UNIT OF REGIONAL TRANSPORT WORKS BAN QUANL 0 DFuA KH C_ Doan Xuan Dan Deputy Director (Letter of Attorney dated March 02, 2016) Hai Phong, June 28, 2016 3 VIET NAM AUDITING AND EVALUATION COMPANY LIMITED AN INDEPENDENT MEMBER OF BKR INTERNATIONAL snocoi Specialized in Auditing, Evaluation, Consultancy on Finance, Accounting and Tax Hanoi, June 29", 2016 INDEPENDENT AUDITORS' REPORT To: The Project Management Unit of Regional Transport Works We have audited the accompanying Balance sheet of Hai Phong Urban Transport Development Project (hereinafter referred to as "the Project") as at December 31, 2015 and the related Statement of sources and uses of funds, Statement of expenditures by sources, Statement of Designated account, and Statement of loan withdrawal (collectively referred to as the "Financial Statements") for the year then ended and the Notes thereto dated June 28, 2016. The Finanacial statements are prepared in persuance to the accounting policies disclosed in Note 3 of the Notes to the Financial Statements, and in accordance with the relevant covenants of Financing Agreement No. 4900-VN, and Amendments of Financing Agreement dated September 17, 2014 and June 09, 2015 between the Government of the Socialist Republic of Vietnam (SRV) and International Development Association (IDA). Project Management Unit's responsibility for the Financial Statements The Project Management Unit (the "PMU") is responsible for the preparation and fair presentation of the Financial Statements of the Project in conformity with the accounting policies disclosed in Note 3 of the Notes to the Financial Statements and for such internal control that management determines is necessary to enable the presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors' responsibility Our responsibility is to express an opinion on the Financial Statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Financial Statements of Project are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosure in the Financial Statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Project'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 Project Management Unit'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 evaluating the overall presentation of the Financial Statements. We believe that the audit evidences we have obtained are sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, in all material respects: - The Financial Statements give a true and fair view of the Project's financial position as at December 31, 2015 as well as its receipts and expenditures for the year then ended in conformity with the accounting policies disclosed in Note 3 of the Notes to the Financial Statements. Head Office: 11 Flor Song Da Building Branch: No. 15f4 Nguyen Huy Tuong No. 165. Cau Gisy Street. Cau Gay Dist, Hanoi Ward 6, Binh Thanh Dist., Ho Chi Minh City Tel: 04.62570 491/492/493 Fax: 04.62 670 494 DT: 08 6294 111716252 1818 Fax: 08. 6294 1119 Website: ww1.aecom.va INDEPENDENT AUDITORS' REPORT (continued) The Financial Statements give a true and fair view of the balance of Designated account as at December 31, 2015 as well as the receipts and expenditures of the Project via Designated account for the year then ended, in accordance with relevant covenants of Financing Agreement for the Credit No. 4900-VN, and Amendments of Financing Agreement dated September 17, 2014 and June 09, 2015 between the Government of the Socialist Republic of Vietnam (RSV) and International Development Association (IDA), Project Financial Management Manual and relevant regulations established by the World Bank. Withdrawal applications were adequately reconciled to the Statement of expenditures ("SOEs") prepared by the PMU for the year then ended and those SOEs are adequately supported by accounting vouchers. cy CONG TY RACH NHIIH' *KIEM lOAN VAUl1N VIET HAM4 T ra& 6iTuan Ngo Ba Duy General Director Auditor Audit Practice Certificate No. 0148-2013-034-1 Audit Practice Certificate No. 1107-2013-034-1 For and on behalf of VIETNAM AUDITING AND EVALUATION CO., LTD 5 HAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For the fiscal year ended 31/12/2015 BALANCE SHEET As at 31/12/2015 Unit. VND Notes 31/12/2015 31/12/2014 A - ASSETS Current assets 374,028,466,642 590,195,697,050 Cash on hand 5.1 66,330,000 77,600,000 Cash in bank, State treasury 5.2 100,128,098,861 83,520,703,522 Other receivables Prepayment to supplier 6 273,834,037,781 506,597,393,528 Total assets 374,028,466,642 590,195,697,050 B - LIABILITIES Current liabilities 53,317,301,614 19,567,434,170 Trade accounts payable 7 51,794,379,401 18,202,443,815 Amounts payable to the State Other payables 8 1,522,922,213 1,364,990,355 Total liabilities 53,317,301,614 19,567,434,170 NET ASSETS (A - B) 320,711,165,028 570,628,262,880 NET SOURCES Differences between of Sources and Expenses 320,711,165,028 570,628,262,880 TOTAL NET SOURCES 320,711,165,028 570,628,262,880 Hai Phong, June 28, 2016 PROJECT MANAGEMENT UNIT Chief Accountant Director Dao Nguyen Nhung Doan Xuan Dan 6 RAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For the fiscal year ended 31/12/2015 STATEMENT OF SOURCES AND USES OF FUNDS The year 2015 Unit: VND Accumulated to The year 2015 Accumulated to 31/12/2014 31/12/2015 Sources Credit fund from IDA 908,696,363,873 581,629,817,493 1,490,326,181,366 Counterpart fund 796,035,916,200 130,794,632,700 926,830,548,900 Exchange rate differences 3,328,963,896 8,881,051,224 12,210,015,120 Total 1,708,061,243,969 721,305,501,417 2,429,366,745,386 Expenses Civil works 448,980,216,468 613,091,604,084 1,062,071,820,552 Goods 3,961,200,000 49,376,475,400 53,337,675,400 Training 903,352,359 920,379,830 1,823,732,189 Operating costs 18,195,948,567 898,850,000 19,094,798,567 Land acquisition 491,964,613,343 235,172,848,234 727,137,461,577 Consultancy services and other expenses 173,427,650,352 71,762,441,721 245,190,092,073 Total 1,137,432,981,089 971,222,599,269 2,108,655,580,358 Differences between of Sources and Expenses Fund balance at the beginning of the - 570,628,262,880 period Fund balance at the end of the period 570,628,262,880 320,711,165,028 320,711,165,028 Hai Phong, June 28, 2016 PROJECT MANAGEMENT UNIT Chief Accountant Director Dao Nguyen Nhung Doan Xuan Dan 7 00 Co ON - 00 - e cc l - ' in e 00 c\ m ýO ca kr N N r- ) - N t- - CN N s 00 on CN *-.~v \ ONm n f e eo un r< t~o 0 e 1- nr l- C> sf el el < nO '. 0o '. ý sfr rffP n elme o r- C C - < t- no < 00 C 'C ~ o V) NI R C) C kn m oo - - so s '0 r fl rå so s LN LN e e V 00 ca < 00 in 0 n o NCo N 0o 'f 00ro o'- cC && o sf n O isn 0s ON fN fn > O el 0s 000o0s el ON o ron -DO ON e 0 O e e ON - n f C C4 00< 03 00 e- i n rn en 00ý 4>ý fl cn 000n cm ~ c C> in4 k n en 0n CN el elN 0~~- ON OOONN 0 0 OV0') 00 0r0 0 0- co 0) 0n 00 0l el el eloe n. 'D el el ko wi Qu sf sf i 0f rR0 'D 0 el n el e 2: ~ ~ ~ r 4 ;ff t40 l Cf - el ~~ -' 'd n 00 0 e .-，·！。―／「「씸 HAIPHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For thefiscalyear ended 3111212015 STATEMENT OF DESIGNATED ACCOUNT The year 2015 For the period: From 01/01/2015 to 31/12/2015 Accountno.: 10924717886688 Vietnam Technological and Commercial Joint Stock Bank - Hai Phong Depository Bank: Branch Address: No. 5 Ly Tu Trong, Hong Bang district, Hai Phong city, Vietnam Credit No,: CR - 4900 - VN Currency: USD Total Part A - Account activifly Opening balance at the period 3,928,390.39 Add.- - Amount replenished by the World Bank in the period 26,830,240,12 - Interest from bank deposit - Total amount reimbursed for unreasonable expenses Less: - Total amount withdrawn 26,250,469.94 - Bank charge - Amount refund to the World Bank Closing balance at the period (31/12/2015) 4,508,160.57 Part B - Account reconciliation Amount advanced to Designated account 8,000,000.00 Add: Amount replenished by the World Bank Less: Amount recovered by the World Bank Total amount advanced into Designated account as at 31/12/2015 8,000,000.00 Balance of Designated account as at 31/12/2015 4,508,160.57 Add: Amounts withdrawn but not yet claimed 3,491,839.43 Outstanding amount advanced to Designated account as at 31/1212015 8,000,000.00 Hai Phong, June 28, 2016 PROJECT MANAGEMENT UNIT Chief Accountant JHO Director B N QU44 L 1) KHU C GAC C6NG GLAO TH VAN T Dao Nguyen Nhung Doan Xuan Dan 10 〕〕斗！！· HAT PRONG URBAN TRANSPORT DEVELOPMENT FINANCIAL STATEMENTS PROJECT For the year endedDecember 31,2015 Credit No. 4900-VN NOTES TO THE FINANCIAL STATEMENTS (These notes are an integral part of and should be read in conjunction with the accompanying Financial Statements) 1. Overview of the Project Hai Phong Urban Transport Development Project (hereinafter referred to as "the Project") operates on Financing Agreement for the Credit No. 4900-VN dated May 31, 2011, and Amendments of Financing Agreement dated September 17, 2014 and June 09, 2015 between the Government of the Socialist Republic of Vietnam (SRV) and International Development Association (IDA), Total fund undertaken for the Project is USD 276.61 million, of which USD 175 million and USD 101.61 million are financed by the IDA and the People's Committee of Hai Phong, respectively. The Project consists of 3 components, namely: - Component A: Urban Main Road Development - Component B: Public Transport Improvement - Component C: Capacity building. The Project budget by components is as follows: Project budget cost by components Total IDA's % (USD million) financing financing Component A- Urban Main Road Development 263.58 163.93 62.20 A I - Construction of a new Bac Son - Nam Hai East-West 161.86 137.58 85.00 Link (1) A2 - Niem I Bridge and Truong Chinh Road Improvement 12,41 10.55 85.00 (1) A3 - Land Acquisition and Resettlement (2) 61-37 - - Compensation 71.75 - Resettlement 1629 - (Zess cost recoveryfrom land sales) -26.67 - - A4 - Consultant Engineering Services 16.15 15.8 97.84 Internal management costs 11.79 - - Component B - Public Transport Improvement 8.04 6.24 77.61 BI - Technical assistance for a Public Transport Authority 1.76 1.76 100.00 (PTA) B2 - Transformation of Line 2 Bus Services 3.59 2,39 66.80 B3 - Kien An Corridor Improvements 2.69 2.09 77.6r Tam Bac - Kien An Corridor Upgrade 2.09 2.09 100. Landplanning 0.31 - Internal managment costs 0.29 - 0 Component C - Capacity Building 4.99 4.83 96 C I - Integrated planning connect system (PCS) 0.77 0.77 100.00 C2 - Capacity buiding and Human Resource Development 0.64 0.64 100.00 C3 - Project Implementation Support 3.58 3.42 95.30 Project implementation support 3.42 3.42 100.00 Internal managinent costs 0.16 - Total 276.61 175-00 63.27 (1) Under Amendment of Financing Agreement dated September 17, 2014 between the Socialist Republic of Vietnam (SRV) and International Development Association (IDA), the IDA financing for civil works under Sub-component Al and A2 is revised up from 85% to 100%. (2) Under Amendment of Financing Agreement dated June 09, 2015 between the Socialist Republic of Vietnam (SRV) and International Development Association ("IDA"), civil works under sub-component A3 is added as wholly (100 %) financed by the IDA. Objectives of the Project The Project's objectives are to improve urban accessibility and to strengthen capacity for urban transport management and planning in Hai Phong. 12 HAI PHONG URBAN TRANSPORT DEVELOPMENT FINANCIAL STATEMENTS PROJECT for the year ended December 31, 2015 Credit No. 4900-VN NOTES TO THE FINANCLAL STATEMENTS (continued) (These notes are an integral part of and should be read in conjunction with, the accompanying Financial Statements) Duration of the Project According to the Agreement, The duration of the Project is five fiscal years, from 2011 to 2016, with the effective date on July 28, 2011 and the closing date by December 31, 2016. 2. Basis for financial reporting and accounting period Basis for financial reporting The financial statements are prepared on the modified cash basis of accounting, and accordingly, income is recognized as received and expenditures as incurred. These accounting policies differ from those in application for fiscal 2014 and the years before, under which receipt is recognised when received rather than the right to receive the income arises and an expenses is recognised when paid rather than when the obligation to pay them arises. Therefore, certain indicators and items in the Balance sheet and the Statement of sources and uses of funds for the prior years were adjusted and re-classified, with details of such adjustment and reclassfication being disclosed in Note 9 of the Notes to the Financial Statements. Accounting period The fiscal year of the Project begins on January 01 and ends on December 31. 3. Summary of significant accounting polices Belows are the significant accounting policies addopted by the PMIU in the preparation of the Financial Statements: Foreign currency translation Receipts and disbursements denominated in foreign currencies are translated into Vietnam dong (VND) at the rate of exchange adopted by Vietnam Technological and Commercial Joint Stock Bank - Hai Phong $ Branch on the transaction date. Non-cash account related transactions in foreign currency are translated into 7 VND using the central rate stated by the State Bank of Vietnam on the transaction date. C Year-end balances of assets and liabilities are revalued using the central rate ruling on the balance sheet date. Exchange difference gains/losses are recognised in the exchange difference account and presented in the Statement of sources and uses of fund. Recognition offlnds and expenses Funds are recognized when received, that is, IDA financing is recognized when remittance is effective into the Designated account and the counterpart fund (from the Government of Vietnam) when payments are made directly to suppliers/vendors of the Project or when such funds are transferred into the PMU's account for its operating costs. Expenses are recognised as incurred, that is, spending items under "Civil works, goods, consultancy services and training" are recognized when the obligation to pay them arises by the amount of work handed over between a contractor and the PMU; Land acquisition expenses and related administration costs are recognized provided that adequate supporting documents are availed of and that compensation money has been paid to affected individuals and entities; Other expenses are recognized when they are incurred. Proceeds from sales of bidding documents Under the Ministry of Finance Official Letter No. 15033/BTC-DT dated November 07, 2011, the Project can use proceeds from selling procurement documents to cover printing expenses and bidding related costs and pay for taxes as statutorily regulated. The remaining amount after deduction of these expenses and taxes is paid to the State budget other than recognized as a source of income for the Project. 13 HAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For the fiscal year ended 31/12/2015 NOTES TO THE FINANCIAL STATEMENTS (continued) (These Notes are an integral part ofand should be read in conjunction with the attached Financial Statements) 4. Designated account and interest from Designated account The Designated Account is a deposit account in USD opened at Vietnam Technological and Commercial Joint Stock Bank - Hai Phong Branch for serving the Project's activities. The payment from the Designated Account is performed for the valid expenditures, in accordance with the related regulations of Financing Agreement for the Credit No.4900 - VN and the related regulations of the World Bank. Interests of Designated account are used to cover depository bank charges and considered as a source of income of the State's budget and presented into the item "Other payables" in Balance Sheet. When the Project is completed, the unused interest is returned to the Government of Vietnam. 5. Cash 31/12/2015 31/12/2014 VND VND 5.1. Cash on hand 66,330,000 77,600,000 Cash in VND - Source of counterpart fund 42,030,000 77,600,000 Cash in VND - Other sources 24,300,000 - 5.2. Cash in bank, State Treasury 100,128,098,861 83,520,703,522 Vietnam Technological and Commercial Joint Stock Bank - 98,693,344,861 83,520,703,522 Hai Phong Branch Cash in USD 98,692,134,983 83,479,497,437 IDA Designated account 98,683,634,877 83,464,037,367 IDA interest from Designated account 8,500,106 10,819,959 Account of selling procurement documents - 4,640,111 Cash in VND 1,209,878 41,206,085 Account of selling procurement documents 1,209,878 41,206,085 Hai Phong State Treasury 1,434,754,000 - Cash in VND 1,434,754,000 - Expense of Project Management 44,163,000 - Temporary account of holding land acquisition expense 1,390,591,000 - Total 100,194,428,861 83,598,303,522 6. Prepayment to supplier 31/12/2015 31/12/2014 VND VND CDM Smith Inc. 11,134,819,997 21,322,812,443 Guangxi Road and Bridge Construction Co., Ltd 73,079,881,778 102,743,967,812 Civil Engineering Construction Corporation No.4 - JSC (Cienco4) 10,260,854,551 58,926,494,172 Obrascon Huarte Lain, S.A. - Dat Phuong Joint Stock Corporation 16,548,667,097 44,696,920,738 Joint -Venture Construction Corporation No.1 - One Member Co., ltd 119,683,193,783 108,555,445,230 Jiangsu Provincial Transportation Engineering Group Co.,ltd 10,583,885,029 26,431,694,643 Dai Hoang Viet Co., ltd - 5,542,384,400 Duyen Hai Investment Consultancy JSC 169,000,000 169,000,000 Center for Assessing Construction Quality Conformity 327,000,000 327,000,000 Green House Architec JSC - 55,600,000 Consultancy Center for Maritime Construction Technology 824,503,000 824,503,000 Development 14 HAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For the fiscal year ended 31/12/2015 NOTES TO THE FINANCIAL STATEMENTS (continued) (These Notes are an integral part of and should be read in conjunction with the attached Financial Statements) Hai Phong Construction and Consultancy JSC 104,100,000 - Vinh Phat Tourism Transport Service Trade Co., ltd - 28,000,000 VNC Construction JSC 1,692,885,000 1,692,885,000 Vietnam-Australia Group JSC 18,342,836,000 18,342,836,000 Hai Phong Transport Works JSC 172,518,000 172,518,000 ROM Transportation Engineering Co., ltd - 4,665,621,600 Board of Compensation and Resettlement of Hai An district - 22,129,359,463 Board of Compensation and Land Acquisition of Kien An district 1,333,649,517 16,265,565,694 Board of Compensation, Land Acquisition, Resettlement of An 2,828,060,018 2,403,494,333 Duong district Center for Land Development of An Lao district 42,412,500 1,440,771,000 Center for Land Development of Le Chan district - 57,538,377,000 Center for Land Development of Ngo Quyen district 6,705,771,511 12,322,143,000 Total 273,834,037,781 506,597,393,528 7. Trade accounts payable 31/12/2015 31/12/2014 VND VND Joint-venture of Vietnam-Denmark VIDAGIS and Environment- 535,188,299 Natural Reosources Technology Service Consultancy JSC (TECOS) Getinsa Ingenieria S.L. - 462,336,499 SMEC International Pty Co., ltd 914,990,523 - International Construction and Investment Consultancy JSC 37,137,746 Hai Phong Transport Engineering Association Consultancy JSC 1,369,000 Hai Phong Civil Works and Invesment Consultancy JSC Hai Phong Public Civil Work Construction and Investment 392,356,619 392,356,619 Consultancy JSC Transport Engineering Design Inc. 629,000 629,000 Thach Dinh Technology and Engineering Consultancy JSC 26,429,000 26,429,000 Thang Long Infrastructure Development JSC 197,533,000 197,533,000 Center for Environmental Resereach 26,511,000 26,511,000 Hai Phong Construction Work Design Consultancy JSC 367,169,100 497,490,000 Board of Compensation and Land Acquisition of Kien An district - - Technical Center for Environmental Natural Resources 132,446,000 132,446,000 Board of Compensation and Resettlement of Hai An district 12,963,613,307 - Center for Land Development of Le Chan district 9,458,855,883 - Corporation No.319 257,197,000 257,197,000 Green House Architec JSC 113,218,000 - PVI Duyen Hai Insurance Company 5,943,274,000 - Dai Viet Construction Design Consultancy JSC 18,609,000 18,609,000 Hai Phong PJICO Insurance Company 18,489,000 - Hai Phong Military Command 12,403,000 5,229,000 Hai Phong Construction and Design JSC 2,609,500 2,609,500 Thuan Thien Design JSC 29,455,000 206,184,000 Bach Dang Construction and Export-Import JSC 6,726,005,782 10,625,603,326 Sao Viet Installation Construction JSC 4,888,826,200 4,888,826,200 Binh Minh Installation Construction Invsetment Consultancy JSC 2,946,081,000 15 HAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For the fiscalyear ended 31/12/2015 NOTES TO THE FINANCIAL STATEMENTS (continued) (These Notes are an integral part of and should be read in conjunction with the attached Financial Statements) International Investment JSC 237,641,000 Nam Son Trade and Construction Co.,ltd 3,617,539,678 ROM Transportation Engineering Co., ltd 965,505,951 CDM Smith Inc. 963,296,813 Getinsa Ingenieria S.L. - 462,454,671 Total 51,794,379,401 18,202,443,815 8. Other payables 31/12/2015 31/12/2014 VND VND Interest from Designated account - Souces of fund from IDA 8,500,106 10,819,959 Payables from selling procurement documents, asset liquidation 25,184,907 45,846,196 Expense advance for Project Management Unit of the year 2014 - 1,305,795,200 from other project's sources. Expense advance for Project Management Unit of the year 2015 1,489,237,200 - from other project's sources. Other payables - 2,529,000 Total 1,522,922,213 1,364,990,355 9. Comparative information Comparative information are data taken from the Financial Statement for the fiscal year ended 31/12/2014 which have been audited by Grant Thornton (Vietnam) Limited. Due to the changes in accounting principle applied for the fiscal year ended 31/12/2015 are the adjusted actual income- actual expenditure that instead the principle of actual income- actual expenditure applied for the fiscal year 2014, so a number of items on Balance sheet and Statement of Sources and Uses of fund for ther fiscal year ended 31/12/2014 are re-adjusted and re-classified by Project Management Unit, details of adjustments and classifications as follows: a) Balance sheet Accumualated to 31/12/2014 Reported amounts Re - adjustment/Re- Amounts after re- classification adjustment/re- j classification VND VND VND T Advance 210,648,462,427 (210,648,462,427) Prepayment to supplier - 506,597,393,528 506,597,393,528 Trade accounts payable - 18,202,443,815 18,202,443,815 Balance of source carried forward the next 292,881,775,594 (292,881,775,594) year Differences between of Sources and - 570,628,262,880 570,628,262,880 Expenses Total 503,530,238,021 591,897,862,202 1,095,428,100,223 b) Statement of Sources and Uses of fund Accumualated to 31/12/2014 Reported amounts Re - adjustment/Re- Amounts after re- classification adjustment/re- classification VND VND VND Sources Other sources 461,528,402 (461,528,402) Total sources 461,528,402 (461,528,402) 16 HAI PHONG URBAN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS Credit No.4900 - VN For the fiscal year ended 31/12/2015 NOTES TO THE FINANCIAL STATEMENTS (continued) (These Notes are an integral part ofand should be read in conjunction with the attached Financial Statements) Expenses 1,415,640,996,777 (278,208,015,688) 1,137,432,981,089 Civil works 762,039,954,537 (313,059,738,069) 448,980,216,468 Goods 9,503,584,400 (5,542,384,400) 3,961,200,000 Training 931,352,359 (28,000,000) 903,352,359 Operating costs 18,175,442,267 20,506,300 18,195,948,567 Land acquisition 427,780,558,406 64,184,054,937 491,964,613,343 Consultancy services and other expenses 196,741,934,630 (23,314,284,278) 173,427,650,352 Bank charges and procurement expenses 468,170,178 (468,170,178) Total expense 1,415,640,996,777 (278,208,015,688) 1,137,432,981,089 c) Notes to adjusted data/data classification at the beginning of the period Decrease of advance amount is equivalent to increase of prepayment to supplier with value of VND 210,648,462,427 due to they are the prepayment amounts to Boards of Land acquisition of districts/communes in the process of land acquisition and prepayment amounts to contractors. Due to the impacts of changes in accounting principle applied for the fiscal year ended 31/12/2015 which are the modified cash basis that insteads the principle of cash basis applied for the fiscal year ended 31/12/2014: Increase of prepayment to supplier is equivalent to decrease of the Project's expenses with value of VND 295,948,931,101 due to that they are prepayment amounts to contractors and there are no minutes of final acceptance/settlement and financial invoices. Increase of trade accounts payable equivalent to increase of the Project's expenses with value of VND 18,202,443,815 due to such expense amounts supported by the minutes of final acceptance/settlement signed with contractors and financial invoices. In accordance with the official Letter No.15033/BTC-DT dated 07/11/201 lissued by the Ministry of Finance, the Project can use proceeds from selling procurement documents to pay for printing expenses and other necessary expenses serving procurement activities, simultaneously, pay for taxes as regulation. The remaining amount after deduction of these expenses and taxes is paid to the State budget other than recognized as a source if income of the Project. Therefore, other incomes are interest from bank deposits and the proceeds from selling procurement documents decreased equivalent to the decreases of bank charges and procurement selection expense with value of VND 461,528,402. Simultaneously, classification of amount of VND 6,641,776 under bank charges and procurement expenses into Other expenses. Due to the impacts of the above issues, the Project's other incomes accumulated to 31/12/2014 decreased by VND 461,528,402, the Project's expense accumulated to 31/12/2014 decreased by VND 278,208,015,688. Hai Phong, June 28, 2016 PROJECT MANAGEMENT UNIT Chief Accountant Deputy Director LhG\O TH Dao Nguyen Nhung Doan Xuan Dan 17