Jiangxi Provincial Audit Office of the People's Republic of China Audit Report $# *W ' 4K (2019) 12 - GAN AUDIT REPORT (2019) NO.12 Project Name: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project Financed by the World Bank Ilk 8234-CN Loan No.: 8234-CN Project Entity: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project Leading Group Office 2018 Accounting Year: 2018 目录 ContentS 一、审计师意见．..................................................................................．……1 1 .Auditor&5 OPininn..............................................................................．……2 二、财务报表及财务报表附注．..........................................................．……5 n .Financial Staternents andNotestotheFinancialStaternents.........．……5 （一）资金平衡表．........................................................................．……5 1 .Balance Sheet.................................................................................．……5 （二）项目进度表．........................................................................．……7 11.Summary of Sources and Uses ofFunds by Project Component．……7 （三）贷款协定执行情况表．......................................................．……10 111.Statement oflmplementation ofLoanAgreement....................．……10 （四）专用账户报表．....................................................................．……n iv.Speeial Account Statemeni.........................................................．……n （五）财务报表附注．....................................................................．……13 v.Notes to the Financial Statements...............................................．……18 三、审计发现问题及建议．................................................................．……23 m .Audit Findings and Recommendations.........................................．……27 一、审计师意见 审计师意见 江襼省世行贷款都阳湖生态经济区及流域城镇发展示范项目办： 我们审计了世界银行贷款江襼都阳湖生态经济区及流域城镇发 展示范项目2018年12月31日的资金平衡表及截至该日同年度的项 目进度表、贷款协定执行情况表和专用账户报表等特定目的财务报表 及财务报表附注（第5页至第22页）。 （一）项目执行单位及江襼省财政厅对财务报表的责任 簖制上述财务报表中的资金平衡表、项目进度表、贷款协定执行 情况表及财务报表附注是你单位的责任，编制专用账户报表是江西省 财政厅的责任，这种责任包括： (1）按照中国的会计准则、会计制度和本项目贷款协定的要求 簖制项目财务报表，并使其实现公允反映。 (2）设计、执行和维护必要的内部控制，以使项目财务报表不 存在由于舞弊或错误而导致的重大错报。 （二）审计责任 我们的责任是在执行审计工作的基础上对财务报表发表审计意 见。我们按照中国国家审计准则和国际审计准则的规定执行了审计工 作，上述准则要求我们遵守审计职业要求，计划和执行审计工作以对 项目财务报表是否不存在重大错报获取合理保证。 为获取有关财务报表金额和披露信息的有关证据，我们实施了必 要的审计程序。我们运用职业判断选择审计程序，这些程序包括对由 于舞弊或错误导致的财务报表重大错报风险的评估。在进行风险评估 时，为了设计恰当的审计程序，我们考虑了与财务报表相关的内部控 制，但目的并非对内部控制的有效性发表意见。审计工作还包括评价 所选用会计政策的恰当性和作出会计估计的合理性，以及评价财务报 表的总体列报。 l 我们相信，我们获取的审计证据是适当的、充分的，为发表审计 意见提供了墓础。 （三）审计意见 我们认为，第一段所列财务报表在所有重大方面按照中国的会计 准则、会计制度和本项目贷款协定的要求编制，公允反映了世界银行 贷款江襼郡阳湖生态经济区及流域城镇发展示范项目2018年12月31 日的财务状况及截至该日同年度的财务收支、项目执行和专用账户收 支情况。 （四）其他事项 我们还审查了本期内报送给世界银行的第8至10号提款申请书 及所附资料。我们认为，这些资料均符合贷款协议的要求，可以作为 申请提款的依据。 本审计师意见之后，共同构成审计报告的坯有两巧内灾．耐久招 表及财务报表附注和审计发现的问题及建议。 ，华人良、匡、西省赢 …、愕卿 L纷：礁、叠山路加9号 2 1. Auditor's Opinion Auditor's Opinion To: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project Management Office We have audited the special purpose financial statements (from Page 5 to Page 22 ) of Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development project financed by the World Bank, which comprise the Balance Sheet as of December 31, 2018, the Summary of Sources and Uses of Funds by Project Component, the Statement of Implementation of Loan Agreement and the Special Account Statement for the year then ended, and Notes to the Financial Statements. Project Entity and Jiangxi Finance Department's Responsibility for the Financial Statements The preparation of the Balance Sheet, the Summary of Sources and Uses of Funds by Project Component and the Statement of Implementation of Loan Agreement is the responsibility of your entity, while the preparation of the Special Account Statement is the responsibility of Jiangxi Finance Department, which includes: i. Preparing and fair presenting the accompanying financial statements in accordance with Chinese accounting standards and system, and the requirements of the project Loan Agreement; ii. Designing, implementing and maintaining necessary internal control to ensure that the financial statements are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Government Auditing Standards of the People's Republic of China and 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 are free from 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 statements, whether due 3 to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entities' 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 evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is appropriate and sufficient to provide a basis for our audit opinion. Opinion In our opinion, the financial statements identified in the first paragraph present fairly, in all material respects, financial position of Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project financed by the World Bank as of December 31, 2018, its financial receipts and disbursements, the project implementation and the receipt and the disbursement of the special account for the year then ended in accordance with Chinese accounting standards and system, and the requirements of the project Loan Agreement. Other Matter Besides, we have audited the withdrawal applications from NO.8 to NO.10 and the attached statements of expenditure, in our opinion, these statements of expenditure accord with the Project Loan Agreement and can be used as basis for withdrawal application. The audit report consists of the Auditor's Opinion and two more parts hereinafter: Financial Statements and Notes to the Financial Statements, Audit Findings and Recommendations. Jiangxi Provincial Audit Office of the People's Republic of China June 22, 2018 Address: No.209 Dieshan Road, Nanchang City, Jiangxi Province, P.R. China Postcode: 330006 Tel.: 0791-86817626 Fax:0791-86823311 The English translation is for the convenience of report users; Please take the Chinese audit report as the only official version. 4 II. Financial Statements and Notes to the Financial Statements i. Balance Sheet BALANCE SHEET 2018 * 12 A) 31 E (As of December 31,2018) Project Name: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project Financed by the World Bank Entity Name: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Currency Unit: RMB Yuan Town Development Project Management Office Line Line Application of fund No. Beginning Balance Ending Balance Sources of Fund No. Beginning Balance Ending Balance 1 1,037,523,084.82 1,402,120,566.94 Total Project 28 480,374,269.99 581,472,016.60 Total Project ExpendituresAprritoFud Appropriation Funds 2 3Z f Project Capital 29 Fixed Assets Transferred and Capital Surplus Construction expeditures to 3 30 be diposedIncluding: Grants be disposed 4 31 550,878,069.80 801,142,685.65 Investments Transferred-out Total Project Loan 4.(ESTW I HWHAE 5 1,037,523,084.82 1,402,120,566.94 Total Project 32 550,878,069.80 801,142,685.65 Construction in progress Investment Loan 6 33 550,878,069.80 801,142,685.65 Investment Loan Receivable Foreign Loan 4k Including: World Bank 7 Including: IDA 34 Investment Loan Receivable Appropriation of Investment 8 35 550,878,069.80 801,142,685.65 IBRD Loan Al : VK44TRSA Including: Appropriation of 9 36 World Bank Investment Technical Cooperation Loan V1, 4M Equipment 10 37 Co-Financing (2) MWA Including : Equipment 11 38 Domestic Loan Losses in Suspense 12 73,844,641.50 47,927,927.66 39 Total Cash and Bank Other loan 5 Line Line Application of fund n Beginning Balance Ending Balance Sources of Fund n Beginning Balance Ending Balance No. No. 1. WWW4k 13 73,840,764.31 47,927,378.91 Appropriation of 40 Cash in Bank Investment Loan 14 5,319,715.75 4,450,946.83 Including: World Bank 41 Including: Special Account Loan 15 3,877.19 548.75 42 Cash on Hand Bond Fund Construction Total Prepaid and 16 35,025,130.85 25,933,627.04 Expenditurestobe 43 0.00 0.00 Receivable offset Including: World Bank 17 0.00 0.00 44 114,846,345.94 92,882,800.10 Loan Interest Receivable World Bank P. Including: World 18 0.00 0.00 45 1,733,939.03 5,457,528.82 Loan Commitment Fee Bank Loan Interest Receivable Payable World Bank Loan World Bank Loan 19 0.00 0.00 46 0.00 0.00 Commitment Fee Service-Fee Receivable Payable -it fWilET Marketable r 20 0.00 0.00 47 0.00 0.00 Securities World Bank Loan Service Fee Payable A, 21 0.00 0.00 48 0.00 0.00 Total Fixed Assets Other payable 22 0.00 0.00 49 0.00 0.00 Fixed Assets, Cost Appropriation of Fund Less: Accumulated 23 0.00 0.00 50 294,171.44 484,619.29 DeprecationRetained Earnings Depreciation 24 0.00 0.00 51 0.00 0.00 Fixed Assets, Net Fixed Assets Pending 25 0.00 0.00 52 0.00 0.00 Disposal Fixed Assets Losses in 26 0.00 0.00 53 0.00 0.00 Suspense 27 1,146,392,857.17 1,475,982,121.64 54 1,146,392,857.17 1,475,982,121.64 Total Application of Fund Total Sources of Fund 6 （二）项目进度表 11.Summary of Sources and Uscs of Funds by Projcct Component 项目进度表（一） SUMMARY OF SOURCES AND USES OF FUNDS BY PROJECT COMPONENTI 本期截至2018年12月31日 伊or the period ended December 31,2018) 项目名称：世界银行贷款江襼都阳湖生态经济区及流域城镇发展示范项目 ProjectName:JiangxiPoyangLakeBasinandEcologicalEconomicZoneSmallToWnDevelopmentProjectFinancedbytheWbrldBank 簖报单位：江襼省世行贷款鄙阳湖生态经济区及流域城镇发展示范项目办货币单位：人民币元 井于习 7 iP W � � 071 � 5 �F,ПрΡ'� М lк � С"� 5уΡ р � Ф 7 (") У И 5 р G W � � N СЛ 00 1 � � О О� � � �1 W Ф Ф СЛ � й� v �Р гD Ф N `Р �1 � � N fD �1 N О1 � � * R A A *(.::-) SUMMARY OF SOURCES AND USES OF FUNDS BY PROJECT COMPONENT 11 2018 * 12 A 31 H (For the period ended December 31,2018) Project Name: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project Financed by the World Bank 94W-t: JVW-L AKT -G Entity Name: Jiangxi Poyang Lake Basin and Ecological Economic Zone Small Town Development Project Management Office Currency Unit: RMB Yuan * R.* lb Project Expenditure A H TV P4 -14 5f ill * kVA H jz LB Description A it Asset Transferred t9TAM Construction Wba5f Grand Total INZ5VI AMVE7 1 )E rl- 5 71, AMNEY" Work in Progress Expenditures Investments Fixed Asset Current Asset Intangible Asset Deferred Asset Transferred-out Transportation 1,017,698,316.28 0.00 0.00 0.00 0.00 1,017,698,316.28 0.00 0.00 Infrastructure Improvement 2.7,K5 Q'&l&AA*A Water 233,308,486.44 0.00 0.00 0.00 0.00 233,308,486.44 0.00 0.00 Resources Management Infrastructure 3.)A H V3X*n4VJ8* Project 81,682,035.59 0.00 0.00 0.00 0.00 81,682,035.59 0.00 0.00 Management and Capacity Building 4AVER Front-end Fee 2,286,337.50 0.00 0.00 0.00 0.00 2,286,337.50 0.00 0.00 5. 9*MRa9)P. Interest in 29,771,268.71 29,771,268.71 construction period 6. E ANA Exchange rate gain or loss 37,374,122.42 37,374,122.42 *ff Total 1,402,120,566.94 0.00 0.00 0.00 0.00 1 1 402,120,566.94 0.00 9 （三）贷款协定执行情况表 111.Statement of Implementation of Loan Agrccmcnt 贷款协定执行情况表 STATE人4ENT OFI伙4PLEh4ENTATION OF LOAN AGREEMENT 本期截至2018年12月31日 伊or the period ended December 31,2018) 项目名称：世界银行贷款江襼都阳湖生态经济区及流域城镇发展示范项目 Project Name:JiangXi Poyang Lake Basin and Ecological Economic Zone Small Tbwn Development Project Financed妙the Wbrld Bank 簖报单位：江襼省世行贷款都阳湖生态经济区及流域城镇发展示范项目办货币单位：美元／人民币元 一一拳落洲 l0 ( V9 ) -V)fl V, 4A iv. Special Account Statement + M * P 1 #1 SPECIAL ACCOUNT STATEMENT *M;k 2018 * 12 A 31 El (For the period ended December 31,2018) Project name: Jiangxi Poyang Lalce Basin and Ecological Economic Zone Small Town Development Project Financed bytheWorldBank 3 PWT-M SAWT*93)-ff Depository Bank.: Shanghai Pudong Development Bank Nanchang Branch *V : 64011457700000018 AccountNo.: 64011457700000018 8234-CN World Bank Loan: 8234-CN kr #A: * G Cmmcy:USD 49MI: i1w4mikrT Prepared by: The Finance Department ofJiangxi Province A 10ft: Part A: Account Activity for the Period Amount 814,134.21 Beginning Balance lk Add: *M1YMffR*9* 32,423,308.31 Total amount deposited by World Bank 2,748.98 Total Interest earned this period if deposited in Special Account Total amount refunded to cover ineligible expenditures M > Deduct *M5U1f19X 32,591,667.95 Total amount withdrawn Total service charges if not included in above amount withdrawn MAO 648,523.55 Ending balance (ro RTo be continued) Part B: Account Reconciliation 12,000,000.00 Amount advanced by World Bank M!,5 Deduct 0.00 Total amount recovered by World Bank 3.*Mtffi KP -9 &VA*4912,000,000.00 Outstanding amount advanced to the Special Account at month/day/year 648,523.55 Ending balance of Special Account at month/day/year JONu add: Amount claimed but not yet credited at month/day/year Application no. Amount 6. I11,366,615.03 Amount withdrawn but not yet claimed 7. HMVjiRfll (tA**E 5 f1 6 tt-) Cumulative service charges (if not included in item 5. Or 6) 9 Deduct: 15,138.58 Interest earned (if included in Special Account) 12,000,000.00 Total advance to Special Accounted for at month/day/year 12 （五）财务报表附注 财务报表附注 1．项目情况 世界银行贷款江襼都阳湖生态经济区及流域城镇发展示范项目贷款 号为8234一cN，旨在通过改善江襼省示范城镇重点发展基础设施，提高城 镇公众服务水平。该项目的项目协议、贷款协定于2013年5月17日签订， 2013年7月19日生效。 2014年开始进行项目中期调整，取消包括道路、公交站和河道治理、 水厂等8个分项目，新增6个分项目；土建工程类支付比例由68％调整为 100%，费用之间也进行调整，关账日期延期至2019年12月31日。世行 同意了中期调整方案，并于2016年1月和12月对涉及《贷款协议》中的 条款进行修改。2017年由于瑞金市古城河综合治理项目建设目标改变， 取消了该项目（详见世行技术支持团2017年9月8日备忘录）。通过2 次调整，项目计划总投资由205308.80万元人民币调整为157932.6万元人 民币，其中世界银行贷款15000万美元，折合人民币94500万元。 1.1项目区分布 南昌、萍乡、九江、赣州、吉安、宜春、抚州和上饶8个设区市的 n个县（市），即：南昌市的进贤县、萍乡市的芦溪县，九江市的九江县和 共青城市、赣州市的赣县和瑞金市、吉安市的井冈山市、宜春市的宜丰县、 抚州市的南丰县、上饶市的横峰县和德兴市实施。 1.2中调后的投资安排 项目计划总投资157933.0万元人民币，其中世行贷款15000万美元 （折合人民币94500万元），占计划总投资的59.8%，国内配套资金63433.0 万元（约合1006&7万粎元），占计划总投资的402％。其中： 子项目A．改善交通基础设施子项目投资107176.2万元人民币（约合 1701 2.1万粎元），占总投资的67.9%; 子项目B．水资源管理基础设施子项目投资36506.2万元人民币（约 合5794.6万粎元），占总投资的23.1%; l3 子项目C．项目管理和能力建设子项目投资1401 4.6万元人民币（约 合2224.5万粎元），占总投资的8.9%; 项目先征费236.0万元人民币（约合37.5万美元），占总投资的0.1%; （详见下表） 单位：万元人民币 ｛一半州 1.3项目建设内容 江襼都阳湖生态经济区及流域城镇发展示范项目由19个城镇基础设 施建设工程和项目管理与能力建设项目组成。 项目建设内容 日典燕洲 2．财务报表编制范围 本财务报表的簖制范围为n个项目县（市）及省本级。财务报表由n 个项目县（市）办公室进行簖制，最后由江西省世行贷款都阳湖生态经济 区及流域城镇发展示范项目领导小组办公室汇总编报。 l4 3．主要会计政策 3.1本项目财务报表按照财政部《世界银行贷款项目会计核算办法》 （财际字（2000)13号）的要求编制。 3.2会计核算年度采用公历年制，即公历每年1月1日至12月31日。 3.3本项目会计核算以“权责发生制”作为记账原则，采用借贷复式记 账法记账，以人民币为记账本位币。 4．报表科目说明 4.1项目支出 2018年项目支出人民币364,597,4 82.12元，累计支出人民币 l,402,120,566.94元，占总投资计划的58.8％。其中： 子项目A．改善交通基础设施子项目支出人民币1,017,658,316.28 元，占子项目A总计划额的95.9%; 子项目B．水资源管理基础设施子项目支出人民币233,308,4 86.44元， 占子项目B总计划额的65.1%; 子项目C．项目管理和能力建设子项目支出人民币81,722,035.59元， 占子项目C总计划额的58.3%; 支出项目先征费人民币2,2 86,337.50元（约合37.50万美元），占该类 计划的96.9%; 建设期贷款利息人民币29,771,268.71元，占该类计划的173.2%; 汇兑损益37,374,122.42元。 4.2货币资金 截至20 18年12月31日货币资金余额为人民币47,927,927.66元，比 上年减少人民币25,916,713.84元，其中专用账户存款折合人民币 4,450,946.83元。 4.3预付及应收款 截至20 18年12月31日余额为人民币25,933,627.04元，主要是预付 工程款等费用。 l5 4.4项目拨款 截至20 15年12月31日余额为人民币551,472,016.60元，是省、（县） 市各级到位的配套资金。 项目计划配套资金总额人民币634,326,000.00元，截至2018年12 月31日到位配套资金581,472,016.60人民币，占计划的91.7％。 4.5项目借款 20 18年12月31日余额为人民币801,142,685.65元，其中：国际复 兴开发银行贷款额为116,730, 196.65美元，折合人民币801,142,685.65 元。 截至20 18年12月31日，累计提取世界银行贷款资金1 16,730,1 96.65 粎元，占贷款总额的77.8％。其中：土建工程累计提款80,126,58728美 元，占该类计划的100.0%；货物、咨询服务和培训类累计提款2,952,951.19 粎元，占该类计划的100%；工程、货物、咨询服务和培训累计提款 21,275,658.18粎元，占该类计划的犯％；先征费本金化375,000美元，占 该类计划的100％。 4.6应付款 2018年12月31日余额为人民币92,882,800.10元，主要是尚未支付 的工程款、工程质保金和世行贷款息费。 4.7留成收入 2018年12月31日余额为人民币484,619.29元，主要是利息收入。 5．专用账户使用情况 本项目贷款专用账户设在浦发银行南昌分行，账号为 64011457700000018，币种为美元。2014年l月15日专用账户首次存款 12,000,000.00粎元。2015年年初余额为814,134.21美元，本年度回补 32,423,308.31粎元，利息收入为2,748.98美元，本年度支付32,591,667.95 粎元，年末余额645,523 .55美元。 l6 6．汇率采用情况 按照中国人民银行2018年12月28日汇率，即1美元一人民币6.8632 元。 7．其它需要说明的事项 7.1项目资金平衡表中国际复兴开发银行贷款期末数与期初数之差、 项目进度表中相应本期发生额与贷款协定执行情况表人民币本期提款数 不一致是由于历年汇兑损益造成的。 7.2《项目进度表2一l)）中的项目总计划额是采用中期调整后的数据。 l7 v. Notes to the Financial Statements Notes to the Financial Statements 1. Project Overview The World Bank financed Poyang Lake Basin and Ecological Economic Zone Small Town Development Project (LN.No.8234-CN) aims to improve key public services in participating small towns of Jiangxi Province through improvements to prioritized infrastructure. The Loan Agreement and the Project Agreement were signed on May 17, 2013 and became effective on July 19,2013. In 2014, the project mid-term review was launched, 8 sub-projects including roads, bus stations, river control and water plant were cancelled, 6 new subprojects were added. The disbursement rate for civil works was adjusted from 68% to 100%, and the costs were adjusted, too. The project closing date was delayed to December 31, 2019. The World Bank approved the mid-term review plan and made revision to the relevant terms in the Loan Agreement in January and December 2016 respectively. In 2017, due to the change of construction target for RuiJin Moat integrated rehabilitation subproject, the subproject was cancelled (details see the aide memorandum of the World Bank technical support mission on September 8, 2017). The total investment of the project was adjusted from RMB2053.088million to RMB1579.326 million through two adjustments, of which, the World Bank loan contributes US$150 million. converting to RMB945 million in equivalence. 1.11'rejectAreas There are 11 project counties /cities under administration of 8 prefectures/cities which are respectively Jinxian county of Nanchang city, Luxi county of Pingxiang city, Gongqingcheng city and JiuJiang county of JiuJiang city, Ganxian county and RuiJin city of Ganzhou city, Jinggangshan of Ji'an city, Yifeng county of Yichun city,Nanfeng county of Fuzhou city, Dexing city and Hengfeng county of Shangrao, city 1.2 Project Investment after Mid-terin Review The total planned investment of the project is RMB 1579.3 3 million, of which, the World Bank loan contributes US$150 million( about RMB945 million in equivalence), accounting for 59.8% of the total investment, while the domestic counterpart fund contributes RMB634.33 million (about US$100.687 million 18 in equivalence), accounting for 40.2% of the total investment, of which: The investment for Component A Transport Infrastructure Improvement is RMB 1071.762 million (about US$170.121 million in equivalence), accounting for 67.9% of the total investment; The investment for Component B Water Resources Management Infrastructure is RMB365.062 million (about USD 57.946 million in equivalence), accounting for 23.1% of the total investment; The investment for Component C Project Management and Capacity Building is RMB 140.146 million ( about USD22.245 million in equivalence) , accounting for 8.9% of the total investment. The project front-end fee is RMB2.360 million ( about US$ 0.37 million in equivalence), accounting for 0.1% of the total investment.( Please see the following tables for details) No. Component Assessment Mid-term +/-Increase/Decrea Value Review Value se 1 Transport Infrastructure 130,266.00 107,176.2 -23,089.8 Improvement 2 Water Resources 59,099.00 36,506.2 -22,592.8 Management Infrastructure 3 Project Management and 15,707.60 14,014.6 -1693 Capacity Building 4 Front-end Fee 236.20 236.0 -0 205,308.80 157,932.6 -47,375.6 1.3 Project Activities The project is comprised of 20 civil works subprojects and a project management and capacity building components. Project Activities No Component Major Contents 15 transport infrastructure subprojects are built in 8 1 Ta povemInt counties/cities, of which, 13 subprojects belong to road infrastructure, 2 belong to bridge engineering Water Resources There are 4 water resources management subprojects 2 Management in 4 counties/cities, of which, 3 subprojects belong to Infrastructure urban flood control works and 1 belong to wetland 19 protection subproject. Project Management 3 and CaaBlng Capacity building, project monitoring and evaluation 1and Capacity Building1 2. Consolidation Scope of the Financial Statements The financial statements covers 11 counties/cities and the province itself. The financial statements are compiled respectively by 11 project offices at counties/cities level and will be consolidated finally by the leading group office of Poyang Lake Basin and Ecological Economic Zone Small Town Development Project. 3. Accounting Policies 3.1 The financial statements of the project are prepared in accordance with the requirements of Accounting Methods for the World Bank Financed Project (Caijizi (2000) 13) 3.2 In accounting practice, the Gregorian calendar year is adopted as the fiscal year from January 1 to December 31 of each year. 3.3 The accruals basis and the debit/credit double-entry bookkeeping method are adopted. RMB is used as the recording currency of bookkeeping. 4. Explanation of Subjects 4.1 Total Project Expenditure In 2018, the project expenditure was RMB364,597,482.12, the project accumulative expenditure was RMB1,402,120,566.94, accounting for 88.8% of the total planned investment, of which: The expenditure for Component A Transport Infrastructure Improvement was RMB1,017,658,316.28, accounting for 95.9% of the total planned investment of the component A; The expenditure for Component B Water Resources Management Infrastructure was RMB233,308,486.44, accounting for 65.1%of the total planned investment of the component; The expenditure for Component C Project Management and Capacity Building was RMB 81,722,035.59 , accounting for 58.3% of the total planned investment of the component. The front-end fee was RMB2,286,337.5 ( about US$ 0.375 million in equivalence), accounting for 96.9% of the planned expenditure. 20 The interest of the loan for the construction period was RMB29,771,268.71, accounting forl73.2% of the plan. The gains or losses of the exchange rate is RMB 37,374,122.42. 4.2 Total Cash and Bank The balance on December 31, 2018 was RMB47,927,927.66, with a year-on-year decrease of RMB25,916,713.84 over the previous year, of which, the funds in the special account were converted to RMB 4,450,946.83. 4.3 Total Prepaid and Receivable The balance on December 31, 2018 was RMB 25,933,627.04, which was mainly advance payment for civil works. 4.4 Total Project Appropriation Funds The balance on December 31, 2018 was RMB581,472,016.60, which was the counterpart funds allocated at each level including the province, the city and the county. The total planned counterpart funds of the project were RMB 634,326,000.00. By the end of December 31, 2018, the counterpart funds available in place were RMB581,472,016.60, accounting for 91.7% of the plan. 4.5 Total Project Loan The balance on December 31, 2018 was RMB801,142,685.65, of which, the World Bank loan of US$116,730,196.65, equivalent to RMB801,142,685.65. By the end of December 31, 2018, the cumulative withdrawal of the World Bank loan was US$116,730,196.65, accounting for 77.8% of the total loan, of which, the cumulative withdrawal of the loan for civil works was US$80,126,587.28, accounting for 100.0% of the plan; the cumulative withdrawal of the loan for goods, consultant service and training was US$2,952,951.19, accounting for 100% of the plan; the cumulative withdrawal of the loan for works, goods, consultant service and training was US$21,275,658.18, accounting for 32% of the plan; the front-end fee capitalization was US$375,000, accounting for 100% of the plan. 4.6 Total Payable The balance on December 31, 2018 was RMB92,882,800.10, which was mainly outstanding payment for works and quality guarantee deposit, and interest and fees for the World Bank loan. 21 4.7 Retained Balance The balance on December 31, 2018 was RMB484,619.29, which was mainly interest revenue. 5. Special Account The special account of the loan is set in Nanchang Branch of Shanghai Pudong Development Bank, with the account number of 64011457700000018, and USD as currency unit. On January 15, 2014, the Special Account deposited initially US$12,000,000.00. At the beginning of 2018, the balance was US$814,134.21. the replenishment in this year was US$32,423,308.31. This year the interest earned was US$2,748.98 and the disbursement was US$ 32,591,667.95. Thus, the ending balance was US$648,523.55. 6. Exchange Rate Adopted According to the exchange rate published by the People's Bank of China on December 31,2018, US$1=RMB 6.8632 7. Other Explanation for the Financial Statements 7.1 In the project balance sheet, the difference of the World Bank loan at the end of the period with the beginning of the period, and the difference between the amount of current period and the withdrawal amount of the period in summary of sources and users of funds by project component were caused by the gains and losses of the exchange rate. 7.2 The project total planned investment in summary of sourcs and users of funds by project component II was the data adopted after mid-term review. 22