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            \\U/                                                                      Babar Mahal Kathmandu Nepa
      Ref No.- 2072/73
             I).

                                                                                        Date: April 06, 2016

                                               AUDIT REPORT
      The Secretary
      Ministry of Finance
      Singh Durbar, Kathmandu
       Report on the Financial Statements
       We have audited the accompanying Project Financial Statements including Statement of
       Designated/Imprest Account.{and Statements of Expenditures SOEs) of the "Nepal-India
       Regional Trade and Transport project (NIRTTP)" financed by IDA Credit No. 5273-NEP
       as at 16 July, 2015 (31 Ashadh, 2072) and for the year then ended and a summary of accounting
       policies and other explanatory notes.
       Management's Responsibility for Financial Statements
       Management is responsible for the preparation and fair presentation of the Financial
       Statements in accordance with the Government of Nepal (GON) accounting policies and
       relevant practices. This responsibility includes: designing, implementing and maintaining
       internal control relevant to preparation and fair presentation of project financial statements
       that are free from material misstatement, whether due to fraud and error.
      Auditor's Responsibility
       Our responsibility is to express an opinion on these Project Financial Statements based on our
       audit. We conducted our audit in accordance with the INTOSAI (International Organisation
       of Supreme Audit Institutions) Fundamental Auditing Principles. Those Principles require
       that we plan and perform the audit to obtain reasonable assurance about whether the financial
       statements are free of 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 to fraud or en-or. In making those risk assessments, the auditor
      considers internal control relevant to the entity'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
      entity's internal control. An audit also includes evaluating the appropriateness of accounting
      policies used and the reasonableness of accounting e�timates made by management, as well
      as evaluating the overall presentation of the financial statements.
       We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
       basis for our audit opinion.



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