THE WORLD BANK NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) (NA TIONAL PRIMARY HEALTH CARE DEVELOPMENTAGENCY (NPHCDA) FINANCIAL STA TEMENTS FOR THE YEAR ENDED 3 1sT DECEMBER, 2018 AUDITED BY OFFICE OF THE AUDITOR-GENERAL FOR THE FEDERATION Plot 273, Samuel Ademulegun Street, Central Business District, Abuja. NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - NPHCDA AUDITED FINANCIAL STATEMENT FOR THE YEAR ENDED 31ST DECEMBER, 2018 CONTENTS PAGE Table of Content 1 Project Background Information 2-3 Members of National Project Steering Committee 4 Statement of the Project Management Responsibilities 5 Auditor's Report 6-8 Statement of Financial Performance 9 Statement of Financial Position 10 Statement of Cash Flow 11 Statement of Changes in Net Assets/Equity 12 Notes to the Accounts 13-18 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) -NPHCDA AUDITED FINANCIAL STATEMENT FOR THE YEAR ENDED 31ST DECEMBER, 2018 PROJECT BACKGROUND INFORMATION The National Primary Health Care Development Agency (NPHCDA) has a mandate to support the development of Primary Health Care (PHC) System in Nigeria and the Agency delivers its core mandates through its various departments. The Department of Primary Health Care Systems Development provides support to States and LGAs on the establishment, operationalization and institutionalization of PHC systems in Nigeria through its divisions: health financing (HF), human resource for health (HRH) and health systems strengthening (HSS). The Health Financing division provides technical guidance and oversight on the development of effective financing mechanisms for PHC systems. The Department also leads the implementation of the Nigeria State Health Investment Project/Additional Financing (NSHIP/AF) which is a Result/Performance-Based Financing (RBF/PBF) approach targeting to strengthen the Nigerian health systems. The NSHIP/AF is a project of Federal Government of Nigeria with credits from the World Bank being implemented in eight States: Adamawa, Bauchi, Bomo, Gombe, Nasarawa, Ondo, Taraba and Yobe. The project aims to improve the provision and utilization of high impact maternal and child health services in the implementing States so as to improve health indices of the implementing States in particular and that of Nigeria at large- The table below gave brief achievement of NSHIP/AF in terms of health facility: NSHIP December 2011 3 52 1,442 AF- June2017 NSHIP 5 39 444 Total _ _8 91 1,886 The Five States of the AF-NSHIP have concluded plans to scale up to addition 12 LGAs and there are probabilities of reaching 2,000 health facilities under the NSHIP/AF-NSHIP. In NSHIP health facilities, both structural and process quality of care have greatly improved since the introduction of the project. In addition, community ownership forms the comer stone of the project and hence, Ward Development Committees (WDCs) in all the wards have been very active and functional. More so, there are at least 1, 800 community-based organizations (CBOs) defending the rights of people in these eight States as they conduct community client satisfaction survey (CCSS) which leads to enhanced community voice in the project implementation. Hence, NSHIP/AF has greatly contributed to the achievement of Government policy of making 10,000 PHCs functional all over the country with at least one functional PBF per ward. The chart below showed the continuous increase in number of people accessing quality healthcare services under the NSHIP/AF. The NSHIP/AF has benefited over 16 million Nigerians from the eight project States from inception till date and more stand to benefit as AF States scale up to additional LGAs. 2 The utilization of maternal, new-born, child, and adolescent health services have increased in many folds. The skilled birth delivery increased with over 300% while health facility attendance also increased with over 350% especially in the Northeast States ravaged with insurgency. The project design also supports the poorest of the poor in the communities through the following mediums: * Indigent Patients (Primary & Secondary): The poorest of the poor can access services from primary level to secondary level free of charge. However, these people are identified by the communities themselves and list supplied to the health facilities - community ownership and voice * Conditional Cash Transfer (CCT): Pregnant Women are given cash stipend for utilizing health services at the designated facilities for focused Antenatal Care (ANC) and facility delivery * Transport Voucher: Under five children, Pregnant Women are encouraged to utilize health services without transportation barrier. For every under five children and pregnant Women that met the criteria are transported free to and from the designated health facilities for related health services In addition, NSHIP/AF has also established strong public-private partnership (PPP) by engaging private health facilities for the provision of health services under same conditions with the public health facilities. This has increased coverage of PHC services and also demonstrated that private entities can fulfill public objectives as long as enabling environments are provided. More so, PHC under one roof as well as system coordination and collaborations of health partnerships have been strengthened in these States. 3 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - (NPHCDA) AUDITED FINANCIAL STATEMENT FOR THE YEAR ENDED 31ST DECEMBER, 2018 MEMBERS OF NATIONAL PROJECT STEERING COMMITTEE 1. Hajia Binta Ismail - National Project Coordinator 2. Mohammed A. Mohammed - Deputy National Project Coordinator 3. Daniel Udounwa - Project Accountant 4. Omega Nduwakan - PBF Focal Person, Adamawa State 5. Seyi Olusunde - PBF Focal Person, Nasarawa State 6. Solape Folarin - PBF Focal Person, Ondo State AUDITORS TO THE PROJECT Office of the Auditor-General for the Federation Audit House Plot 273, Samuel Ademulegun Street, Central Business District, Abuja. Email: info@oaugf.ng Website: www.oaugf.nq AUDITED ENTITY Nigeria State Health Investment Project (NSHIP), No. 32 Queen Elizabeth Crescent, Asokoro, Abuja. Email: nationalnship(dqmail.com, nationalnship0l@gmail.com PROJECT FINANCIERS World Bank Group, Washington DC, USA. PROJECT IMPLEMENTING AGENCY NATIONAL PRIMARY HEALTH CARE Development Agency (NPHCDA), Plot 681/682 Port Harcourt Crescent, Garki, Area 11, Abuja. BANKER Central Bank of Nigeria, Central Business District, Abuja. 4 NIGERIA STATE HEALTH INVESTMENT PROJECT - NSHIP (NPHCDA) AUDITED FINANCIAL STATEMENT FOR THE YEAR ENDED 31ST DECEMBER, 2018 STATEMENT OF THE PROJECT MANAGEMENT RESPONSIBILITIES A dedicated Project Implementation Unit was established within NPHCDA and is responsible for the day-to-day project implementation activities, including disbursement, financial management, procurement, and monitoring and evaluation. Some of the PIU staff were sourced from NPHCDA whom where seconded from key departments within the NPHCDA. Also a few staff was hired following a competitive and open selection. The head of the PIU is the Project Coordinator, who reports directly to the Executive Secretary (ES) and the Supervising Director of Primary Health Care Systems Development Department on issue related to project implementation. The NSHIP PIU is a result/performance based system that is targeted to strengthen the Nigerian health systems. In addition to its fiduciary (Safeguards, Financing Management, and Procurement) responsibilities, the PIU's main functions are to ensure that the project work plans are properly coordinated and implemented by the various NSHIP Pilot States and AF States involved. It also coordinates Strategic Planning for Project Implementation. The PIU was strengthened by additional national and international experts such as technical experts/consultants. The PIU also compile implementation progress report for submission to the Bank and IFRS on timely basis as required. The detailed terms of reference for the PIU will be further elaborated in the Project Operational Manual. The PIU also prepared the Financial Statement in line with IPSAS Accrual and made it available to the external auditors for audit. The Financial Statement were prepared in a true and fair manner. Binta Ismail (Project Coordinator)........ ........... Date ............ ... . Daniel Udounwa (Project Accountant)..L .... .... Date... ... ..... 5 THE AUDITOR-GENERAL FOR THE FEDERATION Audit House, Plot 273, Samuel Ademulegun Street, Central Business District, PM.B. I 28, Garki - Abuja, Nigeria. The Project Coordinator, Nigeria State Health Investment Project (NSHIP), National Primary Health Care Devt. Agency (NPHCDA), Area 11, Garki, Abuja AUDIT OF THE NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) PERFORMED BY THE AUDITOR GENERAL FOR THE FEDERATION AUDITOR'S REPORT Opinion I have audited the financial statements of Nigeria State Health Investment Project (NSHIP), for the year ended 31st December, 2018. These financial statements comprise the Statement of Financial Position, Statement of Financial performance, Cashflow Statement and Statement of Net Assets/Equity for the year then ended, and a summary of significant accounting policies and other explanatory information. In my opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Entity as at 31s' December, 2018, and of its financial performance and its cash flows for the year then ended in accordance with International Public Sector Accounting Standards (IPSAS). Basis for Opinion I conducted the audit in accordance with International Standards for Supreme Audit Institutions (ISSAls). My responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements Section of my report. I am independent of the entity in accordance with the Code of Ethics for Supreme Audit Institutions together with the ethical requirements that are relevant to my audit of the financial statements and I have fulfilled my other ethical responsibilities in accordance with these requirements and the Code of Ethics. I believe that the audit evidences obtained are sufficient and appropriate to provide a basis for my opinion. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with IPSAS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. 6 In preparing the financial statements, management is responsible for assessing the Entity's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the project or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the entity's financial reporting process. Auditor's Responsibility for the Audit of the Financial Statements My objectives is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with (ISSAls), 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 the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Financial Audit Methodology (FAM), which is consistent with the Fundamental Auditing Principles (ISSAls 100-999) of the International Standards for Supreme Audit Institutions, I exercise professional scepticism throughout the audit. I also: * Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. * Obtain an understanding of internal control relevant to the audit 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. * Evaluate the appropriateness of accounting policies uses and the reasonableness of accounting estimates and related disclosures made by management. * Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence, obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity's ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor's report. However, future events or conditions may cause the Entity to cease to continue as a going concern. * Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. 7 I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit. I also provide those charged with governance with a statement that I have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be brought to bear on my independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, I determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditor's report unless law or regulation precludes public disclosure about the matter or, when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. A. M. AYINE, FCA Auditor-General for the Federation June 17, 2019 8 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - NPHCDA STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31ST DECEMBER, 2018 2018 2017 NOTES N N REVENUE 2 IDA Credit 2,841,246,146.73 863,923,330.95 Miscellaneous 2,841,246,146.73 863,923,330.95 EXPENDITURE Consultancy, Training & Workshop 3 1,945,223,776.91 494,806,601.00 Operating Expenses 4 32,129,678.12 210,274,711.00 Depreciation 5 50,511,874.00 42,365,239.00 2,027,865,329.03 747,446,551.00 Surplus/(Deficit) 813,380,817.70 116,476,779.95 Other Comprehensive Income: Exchange Gain on Translation 578,733.28 - TOTAL SURPLUS/(DEFICIT) 813,959,550.98 116,476,779.95 9 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - NPHCDA STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED 31ST DECEMBER, 2018 2018 2017 NOTE S N N ASSETS NON-CURRENT ASSETS Property, Plants & Equipment 5 118,567,226.60 126,510,506.00 Other Capital Cost 6 4,429,566,020.04 450,463,187.00 4,548,133,246.64 576,973,693.00 CURRENT ASSETS Cash & Cash Equivalents 7 90,315,650.50 175,952,237.00 Prepayments - 28,681,344.00 Receivables 8 997,826,641.00 78,664,028.55 1,088,142,291.50 283,297,609.55 TOTAL ASSETS 5,636,275,538.14 860,271,302.55 EQUITY TOTAL EQUITY 5,370,576,686.14 860,271,302.55 LIABILITIES CURRENT LIABILITIES Creditors 9 1,173,328.00 Accruals 10 264,525,524.00 - TOTAL LIABILITIES 265,698,852.00 - TOTAL EQUITY AND LIABILITIES 5,636,275,538.14 860,271,302.55 Binta Ismail (Project Coordinator)......a......... Daniel Udounwa (Project Accountant) .............Dt.......... 10 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - NPHCDA STATEMENT OF CASHFLOW FOR THE YEAR ENDED 31ST DECEMBER, 2018 2018 2017 N N CASH FROM OPERATING ACTIVITIES Surplus or Deficit for the year 813,959,550.98 116,476,775.95 ITEMS NOT INVOLVING MOVEMENT OF CASH Depreciation 50,511,874.00 42,365,239.00 Exchange Difference 578,733.28 100,516.00 NET CASH FLOW OPERATING ACTIVITIES 865,050,158.26 158,942,530.95 CASH FLOW FROM INVESTING ACTIVITIES Purchase of Equipment 27,508,149.00 Purchase of Vehicles - 95,400,000.00 Purchase of Plants & Machinery - 18,038,423.00 Purchase of Goods 2,330,000.00 29,702,056.00 894,888,307.26 302,083,009.95 CASH FLOW FROM FINANCING ACTIVITIES AF-NSHIP Financing * 980,375,516.15 281,921,873.00 -85,636,586.50 -19,960,104.00 Cash and Cash Equivalent at the Beginning 175,952,237.00 195,912,341.00 Cash and Equivalent at the year End 90,315,650.50 175,952,237.00 11 оо и D г'� �-о n оо � � Q �- г� �. � v v -� Q с, и, � °' � � �, � � � п �_„ О� � ^" '< � n � � й а � и � -+, С� р дi . _. �' � 7 07 D� й м ? � � � S`.1 D ,,�,~ w ro о- � � с n Е., ~'' � С г,r [� � О и � rr г* и К ` С � ГD -н � � .=-r LU n � � � � � N '-' Uд N � rt О � 0�0 ОС � n� � rP N и � � т и ..� р о ь-� � С С ~л � °' D � � � и г� о � и � д, г� �у w i--� г., гп D и � о v -о и и � � � гv � :А D Е-' W оо r т гд � ��., и � � tд w � С Z -т-1 й oWO v г �гD V о °' С й т й °�° V �''рС � � ш А � � � и о � � � � и � т п и и Zгхч0 `ovo � � � � � � z и=� D ^'� w w О т г w w � � г z т и С С D � � � � � � � Z� С r С --� и � Z и г.� � .� � °�° � � о w � �" -i w й й й о о о о г� о�о й � 1O � а1 О Q� � � �Р 0�о W �' W NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - NPHICIDA NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 ST DECEMBER, 2018 1. Statement of Accounting Policy The following is the summary of the significant accounting policies adopted in the preparation of the project's Financial Statements: " Basis of Preparation The Financial Statements have been prepared under the historical cost convention. The preparation and content of these Financial Statements are in compliance with the requirement of the International Public Sector Accounting Standard (IPSAS) Accrual Basis except that the statement of Budget and Actual of NSHIP was excluded because it has not been made publicly available as required by IPSAS 24. " Principal Activities Its development objective is to enhance the use of public resources to deliver essential health services to the poor by strengthening accountability at all levels of the health system using result based approach. It aims to increase the delivery and use of high impact maternal and child health interventions to improve quality of the care at selected health facilities in the participating states. " Funds All contribution by the financier are only recognised when they are received as IDA Credit/fund. These funds are subsequently increased or reduced by surplus or deficit from the statement of financial performance. " Recognition of Revenue & Expenditure Revenue and expenditures are recognised when they become receivable or payable or incurred. " Non-Current Assets Non-Current Assets acquired during the year were stated at cost. Depreciation is provided on the non-current assets on a straight line basis in order to write-off their cost over their estimated useful economic lives as follows: Building 2% 0 Plant and Machinery 25% 0 Motor Vehicle 28% 0 Office Equipment, Furniture and Fittings 20% 0 House Equipment 20% a Computer and Software 33.3% * Reporting Currency The Financial Statements were prepared using the Nigerian Naira. * Foreign Exchange Difference on Translation Gain in translation of foreign exchange is recognized in accordance with IPSAS 4 "The Effects of Changes in Foreign Exchange Rates" which requires entities to report financial position at the "closing rate" as at the date of the statement of financial position for 'monetary items'. The closing rate as at 31st December 2018 was N307/$1 as against N305/$1 during the year. * "Other Capital Cost: Development cost" on services provided and transferred by OPM Consultancy is recognized in accordance with IPSAS 31 "Intangible Assets". 14 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) - NPHCDA NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31ST DECEMBER, 2018 NOTES N N 2 REVENUE IDA Credit 2,841,246,146.73 863,923,330.95 Miscellaneous 2,841,246,146.73 863,923,330.95 3 23,333.33 107,343,361.37 1,834,649,460.97 158,302,267.75 3,207,621.24 9,860,000.00 494,806,601.10 4 300,000.00 1,736,607.00 5,772,328.75 34,896,616.96 1,641,051.96 13,560,241.52 879,050.00 1,166,900.00 256,838.00 289,962.00 1,050,000.00 26,111,530.18 39,428,571.43 3,986,088.45 2,840,120.96 3,848,500.00 2,452,555.56 300,000.00 621,416.62 1,621,300.00 6,388,400.00 600,000.00 2,646,000.00 3,964,675.00 20,000.00 210,294,711.23 15 W W z л гэ л v о л � n v z г пггг '� � г" `" = с" г^ й с ь-`�� О г'�г' О О О р-р - � � ni n�i а� D � D z � � ��у т z д7-Э�� \ п � D D р r и � и �i7 о о � W `п � � и � D r и л = rn С1 -- � о�о � N � й � и �^ с � т-i D D < � т ,.� О t� rD- �' -� � г � г П1 -i � оо = -� �, т z D = А � О й '� R7 т и �' -mi Z П = � �' и� � С� D = т� r N � � � w 00 � � о о с -� rn и ' и., � w Z = й � %> .°Р w и i и о т � Й � о о � о о � � � � � � rn о о � ез о � i о т п -�i о, о оо о о оо оо = � � � � т � -г-� � � � о � а о о � о � � т � � и-� ; (7 � � v v � � � � � � � � и и � v т � oWO oWO oWO �р Ui � , о , о о �, , о � _ I � � D z � т i � �и и и w и 1� и � т о� о оо t-' � W rn р w � `о�о й w � й й С О и оа � п й о � оиi о�о r�:i i й rn 3 г� т � 1 W о �,и N г.°'.� оо b � о о° � т о оо о i о и о й ь-Е"', °' `А � '� i" ,wp, D и и w w о оо � w и � С и и w � и и � С� � �1 V W t-� ,' � б�1 "^ г w °rn � '„ � rn � ° � � с о iд о °w о° о I °о о � гЯ„ о ч w о � о и � W �-' rn `Р и-� �., I� � F, iv оо оо � .с � о ° о о о ; ° D Г'D ;л и' оо и г.� N � � °�° _ -zi � а�, о о о N N z и и W � , ь� 'ир гv й й °о о I о � г о U' О I О -G р ь� ь-� и-� и r� г.� � и n� rv � и о о � rn и� rn оо w �, w ги �,,,, с� .'pi rn v й т .^'л � й й р lO V V � Vt � А tл ,..� o�i rn � � О й W О�о � О О О о О О � о О i 1 rn � О lD 0о V � � О п � т � й а П � � 0� р го го ,_„� Q ° ° т r�n � 7о � г*i � п �• _ � ° г� и т v � � � п- � � � D ° z 3> � О �• � v г� гп т��^ й °r° �➢ n D � о°п � о� т О и n 1-�-� О sii Й и D О ° 2 � R� r�-r °' -i � = й � �''* т р < р� rD- [� � и � v '-+ rt С ��.-� о г� .... С и � О D �-*. n � r р � т ° Z � �з iv � � � � � v w w � W г.� Z tv rv � � о �" о i-� � и, O�i W w А � rP N N 'р � Vз N N V О I-� О�о t�D W N N Й V N �QN1 Й Оио О Оиi rO�i � р�'-'i � С� О� 0о О 0о О Оi ь-+ .Np N N О О О �'' О c.Nn О Сл О й сслл О О О О О .011- А v 1-� 1� ,А N N ,оуо й � `о�о О ь-� й,оио � `.�А N`.'�'А � W б� А О�о W г О N W l�6 � 0�0 О� О� V 0о V О �1 V �1 lD N СО Й О О W t�0 О �V t0 �А NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) NPHCDA NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 ST DECEMBER, 2018 Schedule I Schedule of Receivables SN NAMES AMOUNT 1 Olubajo Olalekan 1,782,878.50 3 Adekusibe Michael 1,400,872.62 4 NPHCDA AF-NSHIP 980,375,516.15 5 Akinyemi S. 0. 2,500,070.00 6 John Onah 98,055.00 7 Opedile Patrick 101,712.00 8 Benson Odaman 499,125.00 9 Oluremi Onabajo 2,261,249.00 10 Seyi Olozunde 4,630,360.76 11 ldris Yusuf 93,428.00 14 Anna Edem 2,261,249.00 15 Aish S. Omar 499,125.00 16 Fakeye Elizabeth 1,125,000.00 17 Eze Lambert 75,000.00 18 Umar S. Umar 123,000.00 997,826,641.03 The amounts N980,375,516.15 is a reimbursable which NSHIP used to fund Additional Finance-NSHIP (AF-NSHIP) to provide funds for the 5 additional Stat. Schedule 2 Schedule of Creditors SN NAMES AMOUNT 1 Ganiyu Salau 76,050.00 2 Salamatu Saleh 6,280.00 3 Daniel Udounwa 14,000.00 4 Bassey Innocent Ita 6,200.00 5 Creditors Local 1,070,798.00 i,173,328.00