.. Horn· of Africa \ R~gional Envkonment · i Centre and. ~etwork ·' ! : Date: March 08, 2018 Ref: AAU-HoA l()/1V2018/2010 Tri:~ Wo~ld ~an.k Ethiopia Country Office ; '; ' I • ,. ' , ' I' ' '' .. Fi~ance Manager , Addis Ababa ,: - ' ·, ! ' ' ,; ·. ! ( TeL +251(0)11-895· 1992 or,+251(0)11-655 0226 Fax: +_251 (0)11-123 9469 ::E-mai(info@hoarec.org P.0.Box: 80773 Addis Ababa, Ethiopia ~[R- 0 _lE_(C_[E-~\1-d==E.t:-::\Q:;::;::~:-1 W\NW.hoarec.org nQ MM~ ?n1R I) I I ') I I I AUDITORS' REPORT TO .THE SHAREHOLDERS OF ETHIOPIA CLIMATE INNOVATION CENTER GRANT NO. CITF 014509 I I I) AS AT AND FOR THE YEAR ENDED 7th JULY 2017 I) II TAY & Co. Chartered Certified Accountants & Authorized Auditors Addis Ababa, Ethiopia Tel. 251-11-442-1336 Fax 25 l-11~442-133 8 E-mail: tayco@ethionet.et P.O.Box 1335 Addis Ababa, Ethiopia Ethio-china Friendship Street Wongelawit Tadesse Building 1st Floor Website: www~ tayauditing.com r~IEClE~\flED n o u1.n '"""' 1 iLJ D ·O ' 10 I INDEPENDENT AUDITOR'S REPORT ON THE FINANCIAL STATEMENTS OF 10 ETHIOPIAN CLIMATE INNOVATION CENTER (ECIC) GRANT NUMBER CITF 014509 10 Opinion We have audited the financial statements of Ethiopian Climate Innovation Center Grant D Number CITF014509, which comprise the balance sheet as at 07 July 2017, and the statement of receipts and payments, for the year then ended, and notes to the financial statements, :o including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, I the financial position of the Ethiopian Climate Innovation Center Grant Number ··:D CITF014509 as at 07 July 2017 and its receipts and payments for the year then ended in j accordance with the accounting policy of the Project. 10 Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our D responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Project in accordance with the International Ethics Standards Board for Accountants' code D of Ethics for Professional Accounts (IESBA Code) together with the ethical requirement that are relevant to our audit of the financial statement in Ethiopia, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. D Responsibilities of the Management/or the Project Report The management is responsible for the preparation and fair presentation of the financial statements in accordance with the accounting policies of the Project, and for such internal control as management determines is necessary to enable the preparation of a project report that is free from material misstatement, whether due to fraud or error. Auditor's Responsibility for the Audit of the Financial Statements Ll D 10 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 D the economic decisions of users taken on the basis of these financial statements. D D TAY& Addis Ababa March 06,2018 D D D I 10 D D D D D D 0 D 2 0 D ETHIOPIA CLIMATE INNOVATION CENTER GRANT NUMBER CITF 014509 STATEMENT OF FINANCIAL POSITION D FOR THE YEAR ENDED 07 JULY 2017 D Currency: Ethiopian Birr D ASSET EMPLOYEED Notes 2016 CURRENT ASSET D Debtors 3 1,347,026.49 4,167,217.86 Cash and bank balances 4 1,894,330.12 8,344,539.28 D 3,241,356.61 12,511,757.14 CUREENT LIABILITIES 'D Creditors and acruals 5 2,191,816.09 3,489,026.40 1,049,540.52 9,022,730.74 ID REPRESENTED BY Fund balance 6 1,049,540.52 9,022,730.74 ,D D D D D D D D 0 3 0 A LI ETHIOPIA CLIMATE INNOVATION CENTER GRANT NUMBER CITF 014509 D STATEMENT OF INCOME AND EXPENDITURE FOR THE YEAR ENDED 07 JULY2017 D Currency: Ethiopian Birr D Notes 2016 INCOME Grant received from World Bank 2a 4,995,927.00 22,107,592.60 WIPO Project 222,714.68 Miscellaneous Income 1,522.46 Gain on exchange rate 194,002.68 211,052.72 5,414,166.82 22,318,645.32 EXPENDITURES D Professional fee Proof of concept- sub grant 2a 1,592,158.70 5,420,419.32 5,317,258.40 3,895,962.99 Salaries and employee benefit 4,004,971.10 3,183,748.19 D Clients Technical Assistance Promotion 54,903.02 1,436,252.64 963,747.90 Rent 849,666.00 10 I Training and workshops Communication 258,602.15 841,346.17 647,002.60 I 178,050.72 536,339.39 Staff training and inducton 107,298.31 274,652.37 /0 I Travel,ticket and perdiem 203,461.79 208,548.70 I Office equipment and computer 9,603.06 203,233.57 D Accomodation,food and beverages Award 72,922.43 134,751.10 158,384.77 137,080.80 Printing and stationary 71,414.63 113,404.05 D License and subscription fee Bank service charge 783.90 37,057.12 111,113.74 76,294.33 Legal fee 207,000.00 D Fuel and lubricant Utilities 33,074.97 28,492.96 38,691.95 33,618.07 Advertising cost 414,537.95 D Recrutiment cost Transportation 23,650.00 19,620.00 23,587.02 17,108.00 Repair and maintenance 22,322.51 10,206.70 D Miscellaneous 54,284.08 13,799,045.82 67,421.40 18,295,003.75 D EXCESS OF (EXPENDITURE) INCOME OVER (INCOME) EXPENDITUR {8,384,879.00) 4,023,641.57 0 0 .4 0 .n iu ETHIOPIA CLIMATE INNOVATION CENTER GRANT NUMBER CITF 014509 NOTES TO THE ACCOUNTS 0 FOR THE YEAR ENDED 07 JULY 2017 D 1. ESTABLISHMENT A grant agreement was signed on December 20,2013 between the Addis Ababa University and International Bank for reconstruction and development (World Bank) a grant amounting to five mill D United States Dollar ($5,000,000) to assist in financing the project . The objective of the project is to promote Ethiopia's climate resilience and green growth by providin, lo comprensive set at early-stage financing ,business support and capacity builiding services to Ethiopian private sectors, including women and rurally based entrepreneurs and business owners, working to develop,launch and grow innovative climate technology ventures 2. ACCOUNTING POLICY The principal accounting policies adopted by the project are stated bellow: a. Basis of Accounting Modified Cash basis of accounting is used in recognition of sources and uses of funds in that income is recognized When received and expenditures are recognized when paid except for certain accrued D obligations. b. Foreign Currency :o Transactions in foreign currency are converted to Birr at the exchange rate ruling at the date of the transaction. Cash balances denominated in foreing currency are translated at the exchange rate ruling at the balancesheet date and the resulting gain (loss) are recognized in the income and expenditures D statements. c. Fixed Assets D Fixed assets are directly charged to project expenditure at the time of purchase. D D D ,D 5 ·D D D A u ETHIOPIA CLIMATE INNOVATION CENTER GRANT NUMBER CITF 014509 D NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 07 JULY 2017 D Currency: Ethiopian Birr D D 3. Debtors Project advance 1,154,925.43 3,860,047.96 Work advance D Guarantee deposit Sundary debtor 76,821.06 115,280.00 190,116.60 115,280.00 1,773.30 D 1,347,026.49 4,167,217.86 0 4. Cash and bank balances Cash at bank birr & USD account 1,893,294.72 8,324,539.28 10 Fuel coupon 1,035.40 1,894,330.12 20,000.00 8,344,539.28 D D 5. Creditors and acruals Sundary creditors 950,086.20 2,834,691.98 D Withholding tax Income tax 700.71 65,520.61 344,599.79 167,430.80 Value added tax 5,385.43 86,231.03 D Payable to HoAREC Severance payable 332,298.97 807,856.49 Pension contribution 29,967.68 56,072.80 D 2,191,816.09 3,489,026.40 D 6. Fund balance D Opening balance Prior year adjustment 9,022,730.74 411,688.78 5,012,408.15 (13,318.98) Current year transfer (8,384,879.00) 4,023,641.57 D 1,049,540.52 9,022,730.74 D 6 D n