MINISTRY OF MINES, ENERGY AND RURAL ELECTRIFICATION SIMGov PROJECT FINANCIAL STATEMENTS FOR THE PERIOD FROM APRIL 4, 2018 TO OCTOBER 31, 2019 SIMGoov Project P162737 - SlMGov Project Ministry of Mines, Energy and Rural Electrification Financial Statements For the period From April 4, 2018 to October 31, 2019 (End of Project) Contents Page Statement of Certification 2 Audit Report 3 Statement of Financial Position 4 Statement of Financial Performance 5 Statement of Changes in Net Asset/Equity 6 Statement of Cash Flow 7 Notes to the Financial Statements 8 - 10 1 SIMGov Project P 162737 Ministry of Mines, Energy and Rural Electrification Statement of Certification for the period From April 4, 2018 to October 31, 2019 (End of Project) In our opinion, the attached Financial Statements and Notes on pages 3 - 10 for the Period from 4th April 2018, to 3 1st October 2019 are based on properly maintained financial records and present fairly, in all material respects, the information required by section 2.06 of the Standard Conditions for Grants made by the World Bank out of various funds, dated February 15, 2012 For and on behalf of the SJMGov Project, Ministry of Mines, Energy and Rural Electrification Nicholas Biliki Project Director Signature: Date: Baoro Laxton Koraua Project Manager Signature: 4 4 Date: 2 AUDITOR'S REPORT SIMGov PROJECT P162737 FOR THE PERIOD FROM APRIL 4,2018 TO OCTOBER 31,2019 (END OF PROJECT) Scope We have audited the financial statement of SIMGov Project for the period from April 4, 2018 to October 3 1, 20 19 (end of Project) as set out on pages 4 to 10. The Project Manager responsible for the preparation and presentation of the financial statements and the information they contain. We have conducted an independent audit of these financial statements in order to express an opinion on them to the donors of the Project. Our audit has been conducted in accordance with applicable Auditing Standards to provide reasonable assurance as to whether the financial statements are free of material misstatement. Our procedures included examination, on a test basis, of evidence supporting the amounts and other disclosures in the financial statements, and the evaluation of accounting policies and significant accounting estimates. These procedures have been undertaken to determine whether, in all material respects, the financial statements are presented fairly in accordance with applicable accounting standards and statutory requirements so as to present a view which is consistent with our understanding of the project's financial positions and the results of its operations. The audit opinion expressed in this report has been formed on above basis. Audrit Opinion In our opinion, the financial statements are presented fairly in accordance with applicable International Accounting Standards, so as to present a true and fair view of the financial position of the SIMGov Project for the period from April 4, 2018 to October 31, 2019 (end of Project) and the results of its operations and cash flows for the year then ended. CBL Certified Practicing Accountants Date: 29"' A 2-- H oniara ..... ... ....... Gideon Zoleveke PRINCIPAL SIM Gov Project P162737 Ministry of Mines, Energy and Rural Electrification Statement of Financial Position as at October 31, 2019 (End of Project) Account Description Note 2018/2019 USD ASSET Current Asset Cash and Cash Equivalents 6 Total Cash and Cash Equivalents Total Current Asset Total Asset Equity Total Surplus/(Deficit) for the Period - 0 Total Surplus /(Deficit) for the Period -0 Total Equity -0 4 SIMGov Project P162737 Ministry of Mines Energy & Rural Electrification Statement of Financial Performance for the period From April 4, 2018 to October 31, 2019 (End of Project) Account Description Note 2018/2019 USD FINANCING Grant Proceeds from the World Bank 7 397,383 Total Grant Proceeds from the World Bank 397,383 Total Financing 397,383 Expenditure Components Component 1: Legal Support 8 131,406 Component 2: Strengthen Regulatory Capacity 9 162,040 Component 3: Project Management 10 40,000 Component SlMGov Local Support Fund ANZ 11 63,937 Total Components Expenditure 397,383 Total Expenditure 397,383 Net Cash Flows - 0 5 SIMGov Project P162737 Ministry of Mines, Energy & Rural Electrification Statement of Changes in Net Asset/Equity for the period From April 4, 2018 to October 31, 2019 (End of Project) Accumulated Account Description Surplus/Deficit) USD Equity Balance as at Ist Sept 2018 Changes in Net Equity in 2018/2019 - 0 Total Surplus/(Deficit) for the Period . Balance as at 31st October 2019 0 6 SIMGov Project P162737 Ministry of Mines, Energy and Rural Electrification Statement of Cash Flow for the period From April 4, 2018 to October 31, 2019 (End of Project) 2019/2018 USD Cash Flow from Operating Activities Receipts Grant Proceeds from the World Bank 397,383 Total Receipts 397,383 Payments Component 1: Legal Support 131,406 Component 2: Strengthening Regulatory Capacity 162,040 Component 3: Project Management 40,000 SIMGov Local Support 63,937 Total Payments 397,383 Net Cash Flow from Operating Activities 0 Cash and Cash Equivalent at the Beginning of the Period - Cash and Cash Equivalent at End of Period 0 7 Solomon Islands Mining Governance Project P162737 Ministry of Mines, Energy & Rural Electrification Notes to the Financial Statements for the period From April 4, 2018 to October 31, 2019 (End of Project) I General Information The SIMGov, Project ID: P162737, development objective is to review the existring Mining Act with a view to either ammend or draft a new Bill in line with the findings of the Inter-ministerial taskforcce established for that purpose and to strengthen the capcity of the Department of Mines, particularly in the inspectorate areas. In April, 2018, the Solomon Islands Government and the World Bank signed a Grant Agreement for a grant of USD400,000, Grant No. TF0A6633, to assist in financing this project. It became effective on November 5, 2018 and the closing date was on the 30th June 2019. The Grant Recipient was the Ministry of Finance and Treasury, and the Implementation Agency was the Ministry of Mines, Energy & Rural Electrification for the overall coordination and implementation of the project in accordance with the legal agreement between the World Bank and Solomon Islands Government 2 Significant Accounting Policies a Basis of Preparation The financial statements have been prepared in accordance with Cash Basis IPSAS Financial Reporting under the Cash Basis of Accounting. The accounting policies have been applied consistently throughout the period. b Cash Basis of Accounting The cash basis of accounting recognizes transactions only when cash is received and paid by the Implementation Agency or paid directly under the project from the funds held by the World Bank for this project. c Reporting Currency The financial statements are presented in the United States currency, the United States dollar (USD$), d Foreign Currency Transactions Transactions in foreign currencies are recorded at the exchange rate at the date of the transaction. 3 Component Reporting The reporting format is based on the three components of the project, including funds paid to the local account with ANZ Bank, and the nature of the expenses are reported in notes 7 - 11 4 Budget The budget is developed on the same accounting basis (cash basis), same classification and for the same period as the financial statements 5 Grant Proceeds from the World Bank These funds are received from the World Bank from the Withdrawal Application submitted for direct payment to overseas consultants and transfer to the Designated Account No. 5639225 at ANZ Bank 8 SIMGov Project P162737 Ministry of Provincial Government and Institutional Strengthening Notes to the Financial Statements for the period April 4th, 2018 to October 31, 2019 (End of Project) 6 Cash Cash comprises cash on hand and cash equivalents. Cash equivalents comprise balance at ANZ Bank and any residual balance with the World Bank at the end of the project. 2018/19 USD Cash Balance as at ANZ Bank Project Balance Not Transferred from the World Bank 7 Grant Proceeds Grant proceeds consists of funding from the World Bank under the project, totalling US$397,383. 2019 USD 8 Component 1: Legal Support Legal drafting instructions - University of Western Australia WA 2 20,000 WA 7 10,000 WA 8 20,000 Legal drafting instructions peer review WA 5 30,000 Legal drafting of Mining Bill WA 6 12,500 WA 9 12,500 WA 15 15,000 WA 19 11,406 Total Component 1: Legal Support 131,406 9 SIMGov Project P162737 Ministry of Mines, Energy and Rural Electrification Notes to the Financial Statements for the period April 4, 2018 to October 31, 2019 (End of Project) 2019 USD 9 Component 2: MMERE Strengthening Regulatory Capacity Institutional Strengthening - Mines Inspection - Mark Walker WA 17 40,000 WA 20 22.040 Institutional Strengthening - HR Consultant _Tim Grice WA 12 12,000 WA 23 48,000 Tenement Management System Support Cadastral Consultant - Paul Devries WA 10 10,000 WA 14 20,000 WA 21 10,000 Total Component 2: Strengthening Regulatory Capacity 162,040 10 Component 3: Project Management 2019 Baoro & Associates USD WA 3 14,000 WA 1 16,000 WA 24 10,000 Total Component 2: Strengthening Regulatory Capacity 40,000 11 Solomon Islands Governance - Local Support 2019 ANZ Local Account USD WA 11 50,000 WA 26 - WHTverseas consulting Fees 13,937 Total Component 2: Strengthening Regulatory Capacity 63,937 Total Payments 397,383 10