中华人民共和国内蒙古自治区审计厅 Audit office of Inner Mongolia Autonomous Region of the People&5 Republic of China 审计报告 Audit Report 内审外资〔20 18)003号 AUDIT REPORT〔20 18)No.003 项目名称：世界银行贷款巴彦淖尔市水环境综合治理项目 Project Name:Bayannaoer研／a ter Reclamation and Environment Protection Project Financed by the WOrld Bank 贷款号：8047一CN Loan No.:8047一CN 项目执行单位：巴彦淖尔市河套水务集团有限公司 Proj ect Entity:Hetao WaterAffairs Gro即Co·，Ltd·ofB即annaoer City 会计年度：2017 Accoullting Year:2017 目录 Contents 一、审计师意见．....................................................．······……1 1 .Anditor&s Opininn .....................................................．……3 二、财务报表及财务报表附注．........................................．……5 11 .Financial Staterneflts and Notes to the Financial Stater以eflts.....．……5 （一）资金平衡表．.......................................................．……5 1 .Balance Sheet............................................... ..............．……5 （二）项目进度表．..........................................................．……7 ii.Summary ofsources andUsesofFundsbyProjectComponent...．……7 （三）贷款协定执行情况表．...........................................．……n 111 .statement of Implementation ofL0anAgreemeni ...............．……n （四）专用账户报表．....................................................．……12 iv.Special Accouni statement..........................................................．……12 （五）财务报表附注．....................................................．……13 v.Notes to the Financial Statemcnis...................................................．……16 三、审计发现的问题及建议．..........................................．……19 m .Audit Findings and Reco~endations.............................．……21 一、审计师意见 审计师意见 巴彦淖尔市水环境综合治理项目领导小组办公室： 我们审计了世界银行贷款巴彦淖尔市水环境综合治理项目2017 年12月31日的资金平衡表及截至该日同期间的项目进度表、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18页）。 （一）项目执行单位及内蒙古自治区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、项目进度表及贷款协定执行 I清况表是你办的责任，簖制专用账户报表是内蒙古自治区财政厅的责 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编 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 ！一一！ （四）其他事項離 我育廈市畫了二州內中勺柴沾自治怔叩攻汙報縱柴瞇卑規詢第 登1至22荊一勰取斤‘)／近及斤舞資二。找個物，抓坐但：一勾你台二 號法定的平栽，可口作么二情提衛鈴付―居。 抓常州叮意叩J之盾，卜向凡軍，！及舟網邊寺面一五內了：f參 振表叉刀一江很表陪汙刈下榭二―巡的河題于州義。 中／必9／、、 地壯：中國內蒙古自治區呼和浩特市大學京街】比景 懿、挨以；0100之0 吧不：86一047〔一66349羚 伶賣：蹣一叫7 1-6634711 ：翁 望― 2 I Auditor's Opinion Auditor's Opinion To the Leading Group Office of World Bank Financed Bayannaoer Water Reclamation and Environment Protection Project We have audited the special purpose financial statements (from page 5 to page 18) of the World Bank Financed Inner Mongolia Bayannaoer Water Reclamation and Environment Protection Project, which comprise the Balance Sheet as of December 31, 2017, 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 period then ended, and Notes to the Financial Statements. Project Entity and the Finance Department of Inner Mongolia Autonomous Region's Responsibility for the Financial Statements The preparation of the Balance Sheet, the Summary of Sources and Uses of Funds by Project Component 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 the Finance Department of Inner Mongolia Autonomous Region, 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 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 due to fraud or error. In making those risk assessments, the auditor considers internal 3 control relevant to the entities' preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the CirCustinces, but not for the purpose of expressing an oplinion on1 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 presenlation of the financial statements. We believe that the audit evidence we have obtained is appropriate and SuffiCielt to provide a basis lor our audit opinion. Opinion In our opinion, the financial statements identified in the first paragraph present fairly, in all material respects, the financial position of Bayatnnaoer Water Reclamation and Environment Protection Project financed by the World Bank as of December 31, 2017, its financial receipts and disbursements, the project implementation and the receipts and disbursements of special account for the period then ended in accordance with Chinese accounting standards and system, and the requirements of the project loan agreement. Other Matter We also examined the withdrawal application from No.2- to No.22 and the attached documents submitted to the World 3ank during the period. In our opinion, those documents comply with the project loan agreement and can serve as basis for loan withdrawal. The audit report consists of the Auditor's I wo more parts hereinafter: Financial Statements and Not Statements, Audit Findings and Recommendations. Audi ct$' er olia Aut 1wius RegioT la It,* 30, .20 8 Address: No.116, last Ring of University Avenue Iluhhot, Inner Mongolia, China Post Code: 010020 Jelephone: 86- 0471-6634915 Fax: 86-0471-6634711 The English translation is for t1he convenience of report users. Pleaise take the Chinese audit report as the only oflicial version. 4 II. Financial Statements and Notes to the Financial Statements i. Balance Sheet BALANCE SHEET 2017 *12A 31 El (As ofDecember 31, 2017) ProjectName: BayannaoerWaterReclamationandEnvironmentProtectionPmjectFinancedbythe WorldBank *A*f~-k: *!P*1R& ~ f~ k: ARt T Prepared by: Hetao Water Affairs Group Co.,Ld.ofBayannaoer City Curency Unit RMB Yuan Application of Fund Line Beginning Ending Sources of Fund Line Beginning Ending No. Balance Balance No. Balance Balance SMAjUhfti Total -,A HM-10it Total Project 1 638,355,792.08 734, 211,574. 40 28 196,476,355.00 246,476,355.00 Project Expenditures Appropriation Funds 2 98,813,618.05 Project Capital and Capital 29 - - Fixed Assets Transferred Surplus 2. q *10< J-) R-fWL Construction A :Ma 3 - 30 - - Expenditures to be Including: Grants Disposed 3. $ Investments 51 4WS##t 4 - 31 473, 198, 628. 88 482,433,225.27 Transferred-out Total Project Loan 4. E I Construction 1. AfiMa 5 638, 355,792.08 635, 397,956.35 32 324, 748, 584. 88 328,952,223.27 in Progress Total Project Investment Loan Investment Loan 6 - - (1) W#HokA Foreign Loan 33 324, 748, 584. 88 328,952,223.27 Receivable & Including: World Bank At: NV#Tf J= 7 - 34 - - Investment Loan Including: IDA Receivable Appropriation of 8 - - M4if3fROW IBRD 35 324,748,584. 88 328, 952, 223.27 Investment Loan Including :Appropriation WK#H$AMr 9 - 36 - - of World Bank Investment Technical Cooperation Loan V9, 4WEquipment 10 - - I& Co- Financing 37 - - 5 Mr, M E M*t *##(MrBeginning Line Beginning Ending Line Ending Application of Fund Sources of Fund Balance No. Balance Balance No. Balance Including: Equipment 11 - - (2)mF4 o Domestic Loan 38 - - Losses in Suspense 12 10, 998, 504. 19 8, 165, 172.28 2. -AWR Other Loan 39 148,450,044.00 153, 481, 002. 00 Total Cash and Bank 1. W4t4 Cash in Bank 13 10, 998, 504. 19 8, 165, 172.28 Appropriation of Investment 40 - - Loan Including:Special 14 10,949,063. 90 8, 129, 693. 64 Including 41 - - AccountIncluding: World Bank Loan Account 2. k4Cash on Hand 15 - - Th ib1k@#M Bond Fund 42 - - A I-It aln Construction Total Prepaid and 16 20, 561, 093. 70 12,224,314. 00 43 - - Receivable Expenditures to be Offset Including: World Bank 17 - - -. LfMAi+ Total Payable 44 271,762.09 25, 710, 133. 21 Loan Interest Receivable World Bank Loan 18 - - Including: World Bank Loan 45 - - Comitment Fee Receivable Interest Payable "v{ttkt#1*i# World Bank World Bank Loan Service- 19 - - 46 - - Loan Commitment Fee Payable Fee Receivable -E, ;qifE4 Marketable 20R0M - M &f ft World 20 - -47 - - Securities Bank Loan Service Fee Payable 21 31,356.00 18,652.80 A, *3a i Other Payables 48 - - ftL Total Fixed Assets $RP$#Jt, ±10?ARA Appropriation 22 67,000.00 67,000.00 49 - - Fixed Assets, Cost of Fund A : it a [F Less: Accumulated 23 35,644.00 48,347.20 50 - - Retained Earnings Depreciation 24 31,356.00 18,652.80 - - Fixed Assets, Net P I& 23 Fixed 25 - Assets Pending Disposal Fixed Assets Losses in 26 - - Suspense RA i Total M±*ilJ*it Al t of Fn 27 669, 946, 745. 97 754, 619,713.48 51 669,946,745.97 754, 619, 713. 48 Application of Fund __ Total Sources of Fund (The notes are integral parts of the financial statements) 6 （二）项目进度表 11.Summary of Sources and Uses of Funds by Project Component 项目进度表（一） SUMMARY OF SOURCES AND USES OF FUNDS BY PROJECT COMPONENTI 本期截至2017年12月31日 (For the period ended December 31,2017) 项目名称：世界银行贷款巴彦淖尔市水环境综合治理项目 R句ectN田旧e:Bayannaoer场raterRecl田旧atiOnandEnv1ronmentProtectionProjeCtFlnanced妙theM/o rldBank 簖报单位：巴彦淖尔市河套水务集团有限公司货币单位：人民币元 到 7 *M zit Current Period Cumulative *W"qm *MVAV *M;Mt CMM CFAM Current Period Current Period Current Cumulative Cumulative % Budget Actual Period % Life of PAD Actual Completed Completed 5. C2-WH -, k* r*r5*k3EF Wlatehouqi Wastewater 12,472,293.77 12,472,293.77 100.00% 77,240,000.00 91,091,353.24 117.93% Treatment Plant 6. C2-GQ Ganqimaodu Wastewater 3,144,351.69 3,144,351.69 100.00% 109,830,000.00 114,334,997.79 104.10% Treatment Plant 7. C2-WQ Wulateqianqi Wastewater -998,181.45 -898,181.45 100.00% 120,010,000.00 113,553,260.75 94.62% Treatment Plant 8. C3 AW 31* C3-NP $Ij;T%MM3MQ Construction of Artificial 14,245,725.98 14,245,725.98 100.00% 96,660,000.00 60,427,581.79 62.52% Wetland of Wuliangsu Lake Construction of Demonstration Station for Wuliangsu Lake Non point Pollution Control 9. C3-WL Construction of Grid Canals of 2,223,763.59 2,223,763.59 100.00% 101,350,000.00 98,813,618.05 97.50% Wuliangsu Lake Rit*-Ii (DRQ Design Review - - A N IBM* F-I Project Management Contract -Aft Other - - -36,621,185.93 - - -5,301,994.13 Difference 1. RM" ft - -8,336,779.70 - - 12,224,314.00 Change in Receivables 2. Fmt ,t" ft - -25,438,371.12 - - -25,710,133.21 Change in Payables 3. Rf5VEPAA - -2, 833,331.91 - - 8,165,172.28 Change in Cash and Bank 4. A-E - -12,703.20 - - 18,652.80 Other (The notes are integral parts of the financial statements) 8 项目进度表（二） SUh4h4ARY OF SOURCES AND USES OF FUNDS BY PROJECT COMPONENT 11 本期截至20 17年12月31日 (For the period ended December 31,2017) 项目名称：世界银行贷款巴彦淖尔市水环境综合治理项目 Project Name:Bayannaoer从／a ter Reclamation and Environment Protection Project Financed by the Wbrld Bank 簖报单位：巴彦淖尔市河套水务集团有限公司货币单位：人民币元 粤产洲 9 一川 财务报表附注是本表的组成部分（The notes are integralp叭5 of小e rmancial statements) l0 iii. Statement of Implementation of Loan Agreement * 9 * * STATEMENT OF IMPLEMENTATION OF LOAN AGREEMENT * $A;A --:f- 2017 * 12 A 31 H (For the period ended December 31, 2017) -9 f- % ff HO * 't 4 ofil *ff 0 Project Name: Bayannaoer Water Reclamation and Environment Protection Project Financed by the World Bank q4K*1k: Prepared by: Hetao Water Affairs G oup Co., Ltd. of Baannaoer City Currency Unit: RMB Yuan #)z 1 * k 41 * *1 *- # #1 A it *- t R Category Loan Amount Current-period Withdrawals Cumulative Withdrawals c U SD -4 tUSD rT Ar K TP RMB *tUSD R ! RMB 1. Ejff Civil Works 56,230, 000. 00 3,650,619.67 23,853,879.05 48.1117, 276. 08 314,407,905.36 2.'N * Goods 14,000,000.00 - 3. J it AK 46 11 1, 650, 000. 00 212,732.82 1,390,038.79 981,700.02 6,414,624 27 Consulting Service & Training (1) -9 it A A- Consulting Service 1,300, 000. 00 - 766,947.74 5,011,389.92 (2) ;## 350,000.00 212,732.82 1,390,038.79 214,752.28 1,403,23135 Training, Workshop, Study tour 4, ME* Front-end-fee 200,000.00 - - - - 5. XP Special Account 1,244,175.82 8,129,693. 4 3 1,244,175.82 8,129,693.64 )t it Total 72,080, 000. 001 5,107,528.31, 4,203,638. 9 50,343,151.92 328,952,223.28 (The notes are integral parts of the financial statements) 11 (Qq) WVMPA iv. Special Account Statement SPECIAL ACCOUNT STATEMENT *MAI 2017 * 12 }131 H (For the period ended December 31, 2017) Project Name: Bayannaoer Water Reclamation and Environment Depository Bank: China Everbright Bank Protection Projec Financed by the World Bank HohhotBranch t-!#: 8047-CN JIT: 50121488000000949 Loan No. 8047-CN Account No.: 50121488000000949 W4*1A: # ttmJt&kf t-F}#MA: t Prepared by: The Financial Department ofinner MongoliaAutonomous Region Currency: USD A#-$-3r: *M)f*PA 4X o PartA-AccountActivity for the CunentPeriod Amount M-t+4 BeginningBalance 1, 578, 357.2D T: Add: AtMt1 V# # Total Amount Deposited this Period by ADB 3, 52, 083. 60 1,087. 51 Total InterestEarnedthis Period ifDepositedin SpecialAccount Total Amount Refunded this Period to Cover Ineligible Expenditures $3>: Deduct *AM#k% Total Amount Withdawnthis Period 3, 863,352 49 M t * AE # Rq- Total Service Charges this Period if not Included in Above Amount Withdrawn M*+V EndingBalance 1, 24, 175.82 B $#: tkPV#M) PartB-AccountReconciliaion 4 % Amount 1. fff#$#Am AmountAdvancedbyADB 5,000,000.00 AP: Deduct 2. -t# #tBtk#AM TotalAmountRecoveredbyADB 3. *MM* *V#ki *OutstandingAmountAdvancedtothe SpecialAccountatthe Endofthis Period 5,000,00.0W 4. -JM XPM*+ Ending Balance of SpecialAccount 1, 244, 175.82 4W: Add- 5. *AMMAtt #####W#4 Amount ClaimedbutnotyetCreditedattheEndofthis Period - *ik#-- ApplicationNo. 4 Amount 6. %k* AKEItft1§#* *i4 K1*&kI Amount Withdrawn but not yet Claimed atthe End of this Period 3, 763, 352 49 7. #% $ (**t## 5f 6##t) Cumulative Service Charges (If notIncluded inItem5 or6) 150 00 *>: Deduct 8. taLX (4At##t4 ) InterestEarned(IflncludedinSpecialAccount) 7,678.31 9. * MM**# * # TotalAdvancetothe SpecialAccountAccountedifordattheEndofthisPeriod 5, 000,00 S * fl JE t (The notes are integral parts ofthe financial statements) 12 （五）财务报表附注 财务报表附注 1．项目情况 巴彦淖尔市水环境综合治理项目贷款号8047一CN，项目建设将从 根本上治理内蒙古河套灌区各级排干沟、乌梁素海和黄河水生态环境 的水质污染，通过采取建设污水处理厂及再生水回用等有效措施控制 鸟梁素海的外源污染和减少内源污染，建立完善的水质预警系统，有 效保护鸟梁素海、河套灌区和黄河水生态环境。同时项目实施可对巴 彦淖尔市的水资源进行优化配籮，合理开发再生水资源，并且通过深 度加工蒙古国的煤、铜等矿产资源，促进国际区域经济合作，达到经 济发展与环境保护双赢目的。项目贷款协定于2011年7月29日签订， 2011年10月27日生效，预计2018年12月31日前关闭。项目原计划 总投资1,094,000,000.00元，其中利用世行贷款80,000,000.00美元，折 合人民币532,000,000.00元（按项目资金申请报告批复汇率1:6.6541), 国内配套资金562,000,000.00元。2015年8月，项目进行了中期调整， 调整后项目总投资852,910,000.00元，其中利用世行贷款80,000,000.00 粎元，折合人民币489,390,000.00元（按项目中期调整报告），国内配 套资金363,5 20,000.00元。2018年1月，项目进行了第二次修订及关 账日延期，取消佼用项目的部分贷款约7,920,000.00美元，调整后利用 世行贷款72,080,000.00粎元，土建部分提款报账比例调整为100%, 关账日期修改为2018年12月31日。 2．财务报表编制范围 本财务报表的簖制范围包括巴彦淖尔市河套水务集团有限公司的 财务报表及自治区财政厅专用账户报表。 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。 l3 3.3本项目会计核算“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。 3.4按照中国人民银行2017年12月31日汇率，即USDI＝人民币 6 .5342元。 4．报表科目说明 4.1项目支出 2017年项目支出人民币95,855,7 82.32元，累计支出人民币 734,2 11,574.40元，占总投资计划的88.16％。 4.2货币资金 2017年12月31日货币资金余额为人民币8,165, 172.28元，比期 初减少人民币2,833,33 1.91元。 4.3预付及应收款 2017年12月31日余额为人民币12,2 24,3 14.00元，主要是乌拉特 中旗再生水工程、鸟梁素海生态过渡带人工湿地工程预付工程款。 4.4项目拨款 2017年12月31日余额为人民币246,476,355元，其中中央及自治 区到位的配套资金227,366,000.00元，市财政配套资金4,660,000.00元， 巴彦淖尔市水务局8,080,000.00元，后旗财政局4,570,355.00元，中旗 工业园区l,500,000.00元。 项目计划配套资金总额人民币246,876,355.00元，截止2017年12 月31日到位配套资金人民币246,4 76,35 5.00元，占总计划的99.84%, 其中：中央财政环保项目专项资金累计到位人民币50,600,000.00元， 占计划的100%；中央节能预算内投资累计到位人民币20,000,0 00.00 元，占计划的100%；中央基建投资预算拨款累计到位人民币 42,0oo,0 00.00元，占计划的100%；自治区环保拨款累计到位人民币 50,000,000.00元，占计划的100%；自治区财政水污染防治专项资金累 计到位人民币61,716,000.00元，占计划的100%；自治区排污费环境 保护专项资金累计到位人民币3,050,000.00元，占计划的88.41%；巴 彦淖尔市水务局补助资金累计到位人民币8,080,0 00.00元，占计划的 l4 100%；市财政拨付项目管理费及利息补助4,&0,000.00元，已全部到 位；后旗财政局税费返还4,870,355.00元，已全部到位；中旗工业园区 补贴l,500,000.00元，已全部到位。 4.5项目借款 截止2017年12月31日，巴彦淖尔市水环境综合治理项目账面余 额为人民币482,433,225.27元，其中国际复兴开发银行贷款额（不含专 用账户）为人民币320,522,529.63元。 截止2017年12月31日，累计提取世界银行贷款资金49,0 98,9 76.10 粎元，占贷款总额的68.11%，提取工程类资金48,117,2 76.08美元，占 该类计划的85.57%，提取咨询费981,700.02美元，占该类计划的 59.50%，专用账户余额为1,244,175.82美元；累计国内借款人民币 99,000,000.00元，占总计划的90％。 4.6应付款 2017年12月31日余额为人民币25,710,133.21元，主要是三个污 水处理厂、两个再生水厂及乌梁素海网格水道应付工程款及扣留质保 金部分。 5．专用账户使用情况 本项目专用账户设在光大银行，账号为50121488000000949，币种 为粎元。专用账户首次存款5,000,000.00美元。2017年年初余额 l,578,357.20粎元，利息收入1057.51美元，提款3,528,053.60美元， 支付3,863,352.49粎元，2017年12月31日余额l,244,175.82美元。 l5 v . Notes to the Financial Statements Notes to the Financial Statements 1. Project Overview Bayannaoer Water Reclamation and Environment Protection Project (Ln.8047-CN) is aimed to the treatment of the water pollution in drains of Inner Mongolia Hetao Irrigation Area as well as that in Wuliangsu Lake, and prevents the water ecological environment of Yellow River from pollution. The project also aimed to establish a complete early warning system of water quality to protect the water ecological environment of Wulangsu Lake, Inner Mongolia Hetao Irrigation Area and Yellow River effectively. Besides, the implementation of this project could also optimize the water resources and exploit the reclaimed water resources of Bayannaoer rationally, as well as promote international and regional economic cooperation through the deep processing of the mineral resources (such as coal and copper) of Mongolia, to achieve the goal of win-win situation such as economic development and environmental protection. The Project Agreement was signed on July 29, 2011, came into force on October 27, 2011, and it will be completed on December 31, 2017. The original total investment of the project is RMB1094 million yuan, of which USD80 million is World Bank Loan, which is equal to RUB532 million yuan according to the exchange rate of the Fund Application Report (1:6.6541), and the other RMB562 million yuan is domestic counterpart funds. After the medium-adjustment of the project in August of 2015, the total investment of the project is RMB852.91million yuan, of which USD80 million is World Bank Loan, which is equal to RMB489.39 million yuan according to the exchange rate of the Fund Application Report (1:6.6541), and the other RMB363.52 million yuan is domestic counterpart ftmds. In January 2018, the Loan Agreement of the project was adjusted for the second time. The original loan amount was USD 80 million, cancel a portion of the project loan with amount of USD79.2 million, and the percentage of expenditures to be financed of works was raised to 100%. The closing date extended to December 3 1 2018. 2. Consolidation Scope of the Financial Statements Consolidation scope of the fmancial statements covers the fmancial statements prepared by the project office of Hetao Water Affairs Group Co., Ltd. of Bayannaoer City, and the Special Account Statement prepared by Inner Mongolia Finance Department. 3. Accounting Policies 16 3.1The Financial Statements of the project were prepared according to the requirements of Accounting Methods for World Bank Financed Project of Ministry of Finance (Caijizi (2000) No.13). 3.2In accounting practice, the Gregorian calendar year is adopted as the fiscal year from January 1 I to December 31 st. 3.3The accrual basis and the debit/credit double entry bookkeeping methods are adopted. RMB is used as the recording currency of bookkeeping. 3.4The exchange rate adopted in the financial statements was the exchange rate on December 31st, 2017 of the People's Bank of China, which is USD1= RMB6.5342 yuan. 4. Illustration of Statement Items 4.1 Project Expenditure The project expenditure on year 2017 was RMB95,855,782.32 yuan, accumulated outlay of RMB734,211,574.40 yuan, which was 88.16%of the total investment. 4.2 Monetary Capital The balance of monetary capital was RMB8,165,172.28 yuan until December 31 , 2017, RMB 2,833,331.91 yuan decreased than last year. 4.3 Advance Payment and Receivables Until December 3 1st, 2017, the balance was RMB12,224,314.00 yuan, mainly prepaid project advanced payment, consists of the Ganqimaodu Reclaimed Water Project, the Constructed Wetlands of Wuliangsu Lake. 4.4 Project Appropriation Founds Until December 3 Is, 2017, the balance of Project Appropriation Funds was RMB246,476,355.00 yuan, of which the counterpart fund from national government and the Inner Mongolia Autonomous Region was RMB227, 366,000.00 yuan, the counterpart fund from the Municipal Government was RMB4,660,000.00 yuan, the counterpart fund from the Municipal Water Affairs Bureau was RMB8,080,000, the counterpart fund from the Finance Bureau of Wulatehouqi was RMB4,870,355.00 yuan, the counterpart fund from the Ganqimaodu Industry Zone was RMB1,500,000.00 yuan. The anticipated total counterpart fund was RMB246,876,355.00 yuan. Among which there is RMB246,476,355.00 yuan was up and running, equal to 99.84% of the total counterpart funds until December 3 1st, 2017, including RMB50,600,000.00 yuan special funds for environmental protection project of Central Environment Protection, equal to 100% of its plan; 17 RMB20,000,000.00 yuan funds for energy saving budget investment of Central Government, equal to 100% of its plan; RMB42,000,000.00 yuan funds for construction investment budget allocations of Central Government, equal to 100% of its plan; RMB50,000,000.00 yuan environmental protection funds of Inner Mongolia Autonomous Region, equal to 100% of its plan; RMB 61,716,000.00 yuan Special funds for water pollution prevention and control of Inner Mongolia Autonomous Region, equal to 100% of its plan; RMB3,450,000.00 yuan Special funds for pollution discharge from Inner Mongolia Autonomous Region, equal to 88.41% of its plan, RMB8,080,000.00 yuan special subsidies from Bayannaoer Water Affairs Bureau, equal to 100% of its plan, RMB4,660,000.00 yuan project management fees and interest subsidy from the Municipal Financial Department, RMB4,870,355.00 yuan refunds of taxes from Wulatehouqi Finance Bureau, RMB1,500,000.00 yuan subsidy from the Ganqimaodu Industry Zone. 4.5 Project Loan Until December 31st, 2017, the balance of Bayannaoer Water Reclamation and Environment Protection Project was RMB482,433,225.27.00 yuan, which consists of RMB320,822,529.63.00 yuan of IBRD Loan (excluding special account). Until December 31st, 2017, accumulated withdraw funds from World Bank Loan was USD49,098,976.10, equal to 68.11% of the total loan amount. Among which there was USD48,117,276.08 used for engineering, equal to 85.57% of plan of such type, and USD981,700.02 for consulting service, equal to 59.50% of plan of such type, the balance of the special account is USDI,244,175.82; Accumulated domestic loan is RMB99,000,000.00 yuan, it was 90% of the general plan. 4.6 Account Payable Until December 3 1st, 2017, the balance is RMB25,710,133.21 yuan, is mainly consists of account payable and the retained quality assurance fund of the three wastewater treatment plant, the two reclaimed water treatment plant, and the Canalization of Wuliangsu Lake. 5. Service Conditions of the Specified Account The special account of the project is located in the China Everbright Bank, with account number of 50121488000000949, currency is U.S. dollars. The first deposit of the Special Account was USD5,000,000.00. At the beginning of year 2017, the balance is USDI,578,357.20, the withdraw funds is USD3,528,083.60, the payment is USD3,863,352.49. Among which there are USD1087.51 interest. Until June 3 1st, 2017, the balance is USDI,244,175.82. 18