OFFICIAL E-32 AgargaD O h ENTSngladesh Phone: (880-2) 5566-7777 Facsimile: (880-2) 5566-7778 Qimiao Fan Country Director for Bangladesh, Bhutan & Nepal January 9, 2018 Secretary Kazi Shofiqul Azam Economic Relations Division Ministry of Finance Block 8, Room 3 Sher-e-Bangla Nagar Dhaka-1207 Dear Secretary Azam: Re: IDA Financing 6137-BD Additional Financing for Safety Net Systems for the Poorest Project Additional Instructions: Disbursement and Financial Information Letter I refer to the Financing Agreement between People's Republic of Bangladesh ("Recipient") and the International Development Association ("Association") for the above-referenced Project, dated January 9, 2018. The General Conditions, as defined in the Financing Agreement, provide that the Association may issue additional instructions regarding the withdrawal of the proceeds of IDA Financing 6137-BD ("Financing"), and specify certain financial management reporting and audit requirements. This letter ("Disbursement and Financial Information Letter" or "DFIL"), as revised from time to time, constitutes such additional instructions. The Disbursement Guidelines for Investment Project Financing dated February 2017, ("Disbursement Guidelines") are available in the Association's public website at https://www.worldbank.org and its secure website "Client Connection" at https://clientconnection.worldbank.org. The Disbursement Guidelines are an integral part of this Disbursement and Financial Information Letter, and the manner in which the provisions in the guidelines apply to the Financing is specified below. I. Disbursement Arrangements, Withdrawal and Reporting of Financing Proceeds (i) Disbursement Arrangements: * Instructions (Schedule 1). The table provides the disbursement methods, information on registration of authorized signatures, processing of withdrawal applications (including processing of advances), instructions on supporting documentation, and frequency of reporting on the Designated Account. * Minimum Value of Applications (subsection 3.5). The Minimum Value of Applications for Reimbursement and Direct Payment is equivalent of USD 100,000. * Disbursement Deadline Date (DDD) (subsection 3.7). The DDD is four (4) months after the Closing Date. Any changes to this date will be notified by the Association. (ii) Electronic Delivery. Refer to section 11.01 (c) of the General Conditions: 2 * The Association may permit the Recipient to electronically deliver applications (with supporting documents) through the Association's web-based portal (https://clientconnection.worldbank.org) "Client Connection". This option may be effected if: (a) the Recipient has designated in writing, its officials who are authorized to sign and deliver Applications and to receive Secure Identification Credentials ("SIDC") from the Bank for the purpose of delivering such Applications by electronic means; and (b) all such officials designated by the Recipient have registered as users of "Client Connection". The designated officials may deliver Applications electronically by completing the Form 2380, which is accessible through "Client Connection". The Recipient may continue to exercise the option of preparing and delivering Applications in paper form. The Association reserves the right and may, in its sole discretion, temporarily or permanently disallow the electronic delivery of Applications by the Recipient. By designating officials to use SIDC and by choosing to deliver the Applications electronically, the Recipient confirms through the authorized signatories letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, available in the Association's public website at https://worldbank.org and "Client Connection"; and (b) to cause such official to abide by those terms and conditions. H. Financial Reports and Audits. (i) Financial Reports. The Recipient shall prepare and furnish to the Association not later than one (1) month after the end of each fiscal year, Interim Unaudited Financial Reports (IUFR) for Part 1 of the Project covering the fiscal year. The Recipient shall prepare and furnish to the Association not later than one (1) month after the end of each calendar semester, Interim Unaudited Financial Reports (IUFR) for Part 2 and 3 of the Project covering the calendar semester. (ii) Audits. Each audit of the Financial Statements shall cover the period of one fiscal year of the Recipient, commencing with the fiscal year in which the first withdrawal was made. The audited Financial Statements for each such period shall be furnished to the Association not later than nine (9) months after the end of such period. II. Other Important Information For additional information on disbursement arrangements, please refer to the Loan Handbook available on the Association's public website and "Client Connection". The Association recommends that you register as a user of "Client Connection". From this website you will be able to prepare and deliver applications, monitor the near real-time status of the Financing, and retrieve related policy, financial, and procurement information. For more information about the website and registration arrangements, please contact the Association by email at clientconnection@worldbank.org. If you have any queries in relation to the above, please contact Mr. Satish Kumar Shivakumar, Finance Officer, at satishkumarl@worldbank.org using the above reference. Sincerely, INTERNATIONAL DEVELOPMENT ASSOCIATION Qimiao Fan Country Director for Bangladesh, Bhutan & Nepal Attachments 1. Form of Authorized Signatories Letter 2. Form of Interim Unaudited Financial Report (IUFR) for category 1 3. Form of Interim Unaudited Financial Report (IUFR) for category 2 4. Form of Payments against Contracts Subject to the Association's Prior Review for category 3 5. Form of Statement of Expenditures for category 3 6. Designated Account Reconciliation Statement 4 Schedule 1: Disbursement Arrangements Basic Information Country People's Republic of Bangladesh Financing Number IDA 6137-BD Recipient People's Republic of Bangladesh Project Additional Financing for Name _ Safety Net Systems for the Poorest Project Disbursement Methods and Supporting Documentation Disbursement Methods Methods Available Supporting Documentation (Section 2) (Subsections 4.3 and 4.4) Yes, for categories 2 and 3 in the Direct Payment table under Schedule 2 Section 111.1 Copy of Records of the Financing Agreement ("Withdrawal table") Reimbursement under category I Yes Interim Unaudited Financial Report (IUFR) (Attachment 2) of the Withdrawal table Yes_Interim_Unaudited_Financial_Report_(lUFR)_(Attachment_2) Reimbursement under category 2 Yes Interim Unaudited Financial Report (IUFR) (Attachment 3) of the Withdrawal table * Records evidencing eligible expenditures (e.g. copies of receipts, Reimbursement under category 3 supplier invoices, etc.) for payments against contracts that are subject to of the Withdrawal table Yes the Association's prior review in the form attached (Attachment 4) * Statement of Expenditures (SOE) in the form attached for all other expenditures/contracts (Attachment 5) Advance under category 2 of the Yes Interim Unaudited Financial Report (IUFR) (Attachment 3) Withdrawal table * Records evidencing eligible expenditures (e.g. copies of receipts, supplier invoices, etc.) for payments against contracts that are subject to Advance under category 3 of the the Association's prior review in the form attached (Attachment 4) Withdrawal table Yes * Statement of Expenditures (SOE) in the form attached for all other expenditures/contracts (Attachment 5) * Copy of Bank Statements of the Designated Account and Designated Account Reconciliation Statement (Attachment 6) 5 Yes, for categories 2 and 3 of the * Copy of Letter of Credit Withdrawal table * Proforma Invoice (if cited in the Letter of Credit) Designated Accounts (Section 5 and 6) Segregated, to be operated by Type Department of Disaster Management Ceiling Fixed and linked to category 2 of the withdrawal table Commercial Bank acceptable to the Financial Institution - Name Aocian Currency BDT Association Frequency of Reporting Once in a calendar semester Amount BDT 150,000,000 Segregated, to be operated by Type Bangladesh Bureau of Statistics and Ceiling Fixed linked to category 3 of the withdrawal table Commercial Bank acceptable to the Financial Institution - Name Aocian Currency BDT Association Frequency of Reporting Once in a quarter Amount BDT 1,000,000,000 6 Authorized Signatories (subsections 3.1 and 3.2) The form for Authorized Signatories Letter is provided in Attachment I of this letter Withdrawal and Documentation Applications (Subsections 3.3 and 3.4) Authorized Signatories Letter: Withdrawal and Documentation Applications: The World Bank The World Bank E-32 Agargaon No. 11, Taramani Main Road Sher-e-Bangla Nagar Taramani, Chennai 600 113 Dhaka 1207, Bangladesh India Attention: Country Director Attention: Team Lead (WFALA) Additional Instructions (i) For category I - Beneficiary Wages (under EGPP) under Part I of the Project, only reimbursement disbursement method is applicable. Association's funds may be disbursed to the Consolidated Fund of the Government of Bangladesh based on (i) the lesser of eligible expenditures reported by Interim Unaudited Financial Reports (IUFR); and (ii) achievement of DLI Targets. (ii) Disbursements under each category of the withdrawal table under this Financing would be made after the corresponding category is fully disbursed and documented under the Original Financing IDA 5281 -BD. (iii) All payments for expenditures claimed under this Financing must be made using the banking system, except expenditures paid using the petty cash system following the Recipient's existing policy. The petty cash limit as per the Recipient's existing policy is BDT 100,000. 7 Attachment I Form of Authorized Signatories Letter [Letterhead] Ministry of Finance [Street address] [City] [Country] [Date] The World Bank [Dhaka Office) Attention: Country Director, Bangladesh Re: IDA Financing 6137-BD (Additional Financing for Safety Net Systems for the Poorest Project) I refer to the Financing Agreement ("Agreement") between the International Development Association ("Association") and [name of Recipient] ("Recipient"), dated _ , providing the above Financing. For the purposes of Section 2.03 of the General Conditions as defined in the Agreement, any [one]' of the persons whose authenticated specimen signatures appear below is authorized on behalf of the Recipient to sign applications for withdrawal under this Financing. For the purpose of delivering Applications to the Association, [each]2 of the persons whose authenticated specimen signatures appears below is authorized on behalf of the Recipient, acting [individually]3 [ointly]', to deliver Applications, and evidence in support thereof on the terms and conditions specified by the Association. [This confirms that the Recipient is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Association by electronic means. In full recognition that the Association shall rely upon such representations and warranties, including without limitation, the representations and warranties contained in the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation ("Terms and Conditions of Use of SIDC"), the Recipient represents and warrants to the Association that it will cause such persons to abide by those terms and conditions.]' 1 Instruction to the Recipient: Stipulate if more than one person needs to sign Applications, and how many or which positions, and if any thresholds apply. Please delete this footnote in final letter that is sent to the Association. 2 Instruction to the Recipient: Stipulate if more than one person needs to jointly sign Applications, if so, please indicate the actual number. Please delete this footnote in final letter that is sent to the Association. Instruction to the Recipient: Use this bracket if any one of the authorized persons may sign; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Association. 4 Instruction to the Recipient: Use this bracket only if several individuals must jointly sign each Application; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Association. 5 Instruction to the Recipient: Add this paragraph if the Recipient wishes to authorize the listed persons to accept Secure Identification Credentials and to deliver Applications by electronic means; if this is not applicable, please delete the paragraph. Please delete this footnote in final letter that is sent to the Association. 8 This Authorization replaces and supersedes any Authorization currently in the Association's records with respect to this Agreement. [Name], [Position] Specimen Signature: [Name], [Position] Specimen Signature: [Name], [Position] Specimen Signature: Yours truly, / signed / [Position] 9 Attachment 2 Form of Interim Unaudited Financial Report (IUFR) for category 1 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD Department of Disaster Management INTERIM FINANCIAL REPORT: Component 1 Reporting Period: (fiscal year} (1) Sources & Uses of Funds (2) Use of Funds by Expenditure Type (3) DLI Achievement & Withdrawal 10 Attachment 2 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 1 SAFETY NET SYSTEXIS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD Department of Disaster Management Sources & Uses of Funds (BDT) Reporting Period: {fiscal year} Reporting Period Cumulative Sources of Funds Government (EGPP) Uses of Funds (with budget codes) EGPP: Beneficiary Wages EGPP: Non-Wage Costs EGPP: Labor Sardar Costs EGPP: Administrative Costs Balance (Sources of Funds - Uses ofFunds) 11 Attachment 2 (continued) Form of Interim Unaudited Financial Report (IUFR) for category I SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD Department of Disaster Management Use of Funds by Expenditure Type (BDT) Reporting Period: {fiscal year} Actual Planned (from FY Budget) Variance E p Reporting Period Cumulative Reporting Period Cumulative Reporting Period Cumulative EGPP: Beneficiary Wages TOTALS Actual Eligible Expenditures Reporting Period Cumulative EGPP: Beneficiary Wages (up to 6000) TOTALS 12 Attachment 2 (continued) Form of Interim Unaudited Financial Report (IUFR) for category I SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD Department of Disaster Management DLI Achievement & Withdrawal Reporting Period: {fiscal year} DLI Focus Area DLI Target Year Target Achievement DLI Value (USD) 1 Household Targeting {FY2018 or FY2019} {Yes/No} 2 Administrative Systems (FY2018 or FY2019} {Yes/No} 3 Payment Systems {FY2018 or FY2019} {Yes/No} TOTAL Line Particulars Amount (BDT) Amount (USD) Amount (XDR) 1 Total Value of Achieved DLIs 2 Actual Expenditure on EGPP: Beneficiary Wages (Cunulative) 3 Eligible for Reimbursement (Cunulative) (600o of line 2) 4 Total Disbursements till Date 5 Maximum Disbursement this Reporting Period (ine 3 mmus line 4) WITHDRAWAL REQUESTED (lowerofhnel&lhne5) Exchange Rates (as per Client Connection) XDR 1 USD USD 1= BDT 13 Attachment 3 Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {iinplementing agency) INTERIM FINANCIAL REPORT: {Component no.) Reporting Period: {calendar semester) (1) Sources & Uses of Funds (2) Use of Funds by Expenditure Type (3) Designated Account Activity (4) Expenditure Forecast {category 2 only} (5) Expenditure for Contracts Subject to Prior Review (6) Expenditure for Contracts Not Subject to Prior Review 14 Attachment 3 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency) Sources & Uses of Funds (BDT) Reporting Period: {calendar semester} Reporting Period Cumulative Opening Balance Designated Account Government Account Sources of Funds IDA Government Uses of Funds IDA (Expenditure Category ) Government (Other) Net Funds Available (Opening Balance + Sources of Funds - Uses of Funds) Closing Balance Designated Account Government Bank Account Total Closing Balance 15 Attachment 3 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency} Use of Funds by Expenditure Type (BDT) Reporting Period: {calendar semester} Actual Planned (pre-ious Expenditure Forecast) Variance Expenditure Type .__ pReporting Period Cumulative Reporting Period Cumulative Reporting Period Cumulative Goods Works Non-Consulting Services Consulting Services (Individuals) Consulting Services (Firms) Training Operating Costs TOTALS 16 Attachment 3 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency} Designated Account Activity (BDT) Reporting Period: {calendar semester} Amount Cumulative Advances till end of Reporting Period Cumulative Expenditures till end of previous Reporting Period Outstanding Advances to be Accounted Amount DA Opening Balance at beginning of Reporting Period (plus/minus) Cumulative Adjustments (if any) (plus) Advances during Reporting Period Sub-Total of Advances (incl. Adjustments) (minus) Refund from DA during Reporting Period (if any) Outstanding Advances to be Accounted Amount DA Closing Balance at end of Reporting Period (plus/minus) Cumulative Adjustments (if any) (plus) Eligible Expenditure during Reporting Period Sub-Total of Expenditure (incl. Adjustments) (minus) Interest Earned (or other deposits to DA) during Reporting Period (if any) Total Advances Accounted For 17 Attachment 3 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency} Expenditure Forecast (BDT) Reporting Period: {calendar semester} Expenditure Type Amount Goods Works Non-Consulting Services Consulting Services (Individuals) Consulting Services (Firms) Training Operating Costs TOTAL Amount Expenditure Forecast (minus) DA Closing Balance after Adjustments (minus) Amount to be paid through Direct Payment REQUIRED ADVANCE 18 Attachment 3 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency) Expenditure for Contracts Subject to Prior Review Reporting Period: {calendar semester} Supplier / Contractor / Amount Paid Cnrc Contract No. Contract Contract Invoice Invoice No. Balance Service & Date Currency Amount Amount & Date Carried Reporting Forward Consultant Period Cumulative TOTALS 19 Attachment 3 (continued) Form of Interim Unaudited Financial Report (IUFR) for category 2 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency} Expenditure for Contracts Not Subject to Prior Review Reporting Period: (calendar semester} Supplier / Contractor /, Amount Paid Contract Contract No. Contract Contract Invoice Invoice No. Balance Service & Date Currency Amount Amount & Date Carried Consultat /Reporting C Forward Consultant PeidCumulative Period TOTALS 20 Attachment 4 Form of Payments against Contracts Subject to the Association's Prior Review for category 3 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD Payments against Contracts Subject to the Association's Prior Review for category 3 Date: Payment Period: Application No.: Amount Paid during Amount other Association's Supplier / Payment Eligible than petty Share of Contractor / Period Financing cash payments Contract No. Contract Contract No Objection through Percentage as and not paidPaid & Date Provider Description Amount Date banking per Legal using banking during Payment Consultant system (except Agreement system (not to petty cash be claimed) Period payments) 21 Attachment 5 Form of Statement of Expenditures for category 3 SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD Statement of Expenditures for category 3 Date: Payment Period: Application No.: Contract/ Amount Invoice No. Total Amount Amount other (or other Supplier! of Eligible Eligible for than petty Contract / Financina and reference) & Contractor / Expenditure Financing cash payments .Description of Invoice paid through Date [in case Service Eeniture Curncy covered by Percentage as baing and not paid Amount Paid Payment Date Remarks of Training. Provider / Application per Legal using banking ACTotal Amount system (except Association's Consultant (net of Agreement system (not to p etty cash approval retention) be claimed) details] payments) TOTALS Supporting documents for this SOE retained at: {address} Prepared by: {name, designation and signature} Authorized by: {name. designation and signature} 22 Attachment 6 Designated Account Reconciliation Statement SAFETY NET SYSTEMS FOR THE POOREST (SNSP) (ADDITIONAL FINANCING): IDA Credit 6137-BD {implementing agency} Designated Account Reconciliation Statement Bank Account 1. Total Amount Advanced by World Bank BDT 2. (Less) Total Amount Recoved by World Bank - BDT 3. (Equals) Present Outstanding Amount Advanced to the Designated Account = BDT 4. Balance of Designated Account per attached Bank Statement Dated BDT 5. (Plus) Total Amount Claimed in Application No. + BDT 6. (Plus) Total Amount Withdrawn and not yet Claimed + BDT Reason 7. (Plus) Amounts Claimed in previous Applications not Credited at Date of Bank Statement Application No. Amount BDT BDT (Sub-Total) + BDT S. (Less) Interest Earned - BDT 9. Total Advance Accounted for (line 4 through line 9) = BDT 10. Explanation of any Difference between the Totals on line 3 and line 9 Prepared by: {name, designation and signature} Authorized by: {name, designation and signature}