THE WORLD BANK NATIONAL SOCIAL SAFETY NETS PROJECT (OFFICE OF THE VICE PRESIDENT) CONSOLIDA TED FINANCIAL STA TEMENTS FOR THE PERIOD ENDED 31sT DECEMBER, 2018 AUDITED BY OFFICE OF THE AUDITOR-GENERAL FOR THE FEDERATION Plot 273, Samuel Ademulegun Street, Central Business District, Abuja NATIONAL SOCIAL SAFETY NETS PROJECT P1 51488 FINANCIAL STATEMENTS FOR THE NINE MONTHS PERIOD ENDED 31ST DECEMBER, 2018 CONTENTS PAGE Project Information and Performance 2-3 Statement of Project Management Responsibilities 4 Report of the Auditor 5-7 Consolidated Statement of Sources and Uses of Funds 8 - 9 Summary of Activities in the Designated Account 10 Statement of Financial Position 11 Notes to the Financial Statements 12- 13 NATIONAL SOCIAL SAFETY NETS PROJECT P1 51488 FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2018 PROJECT INFORMATION AND PERFORMANCE The National Social Safety Nets Project (NASSP) is a social protection project financed by the World Bank and guaranteed by the Nigerian Government targeted at the reduction of poverty for the poor and vulnerable in the Nigerian Society. The project objective is to exit over one million poor and vulnerable in the society within the shortest possible period. The NSIO directly supervises the activities of NASSP which gained effectiveness March, 2018. Gradually, the project has been achieving its core mandate of enumerating the Poor and Vulnerable House Holds (PVHHs) in the society, creating the National Social Register (NSR), Community Based Targeting (CBT), National Living Standards Survey (NLSS) and the Conditional Cash Transfer (CCT) service. The NASSP is two pronged comprising the National Social Safety Nets Coordinating Office (NASSCO) and the National Cash Transfer Office (NCTO) both charged with delivering the core mandates of NASSP. The key officers of NASSP are: NASSCO National Coordinator - Apera lorwakwagh Project Accountant - Nwanze Benjamin Chiweta Head, NSR - Solomon N. Odole Procurement Officer - Sa'eed Dantala Umar Head, MERL - Lawal Abdullahi SE & SSNs Coordination Specialist - Yimave Gyangyang Internal Auditor - Emetulu Austin 2 NCTO Project Coordinator - Dr. Temitope Sinkaiye Project Accountant - Ibrahim Jafar R. Head, M & E - Maria Dida Head, MIS - Faminu Olabode Internal Auditor - Jumbo Augustin 3 NATIONAL SOCIAL SAFETY NETS PROJECT P1 51488 FINANCIAL STATEMENTS FOR THE NINE MONTHS PERIOD ENDED 31' DECEMBER, 2018 STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES The accompanying financial statements comprising of Statement of Sources and Uses of Funds, Balance sheet, Statement of Withdrawals (SOE's), Designated Account Activity Statements and related disclosure Notes (further referred as to "Project's Financial Statements"), of the Office of the Vice President of the Federal Republic of Nigeria ("the OVP"), "National Social Safety Nets Project" (further referred to as "the Project"), financed under International Development Bank Credit (IDA) number 58310 Cr ("Original loan") as at and for the period from 1 January to 31 December 2018 included on pages - to -, are the responsibility of, and have been approved by the Project's management. The accompanying Project's financial statements have been compiled by the Project's management, for the purposes of reporting to the OVP and the International Development Association, in conformity with the related requirements of the World Bank's financial reporting guidelines and in compliance with the relevant provisions set out in the Financing Agreement number 58310 Cr dated January 27, 2017. Project's management, in furtherance of the integrity and objectivity of the Project's financial statements, has developed and maintained an internal control structure, including the appropriate control environment, accounting systems and control procedures. Project's management believes that internal controls provide assurance that financial records are reliable and form a proper basis for the preparation of financial statements, and that assets are properly accounted for and safeguarded. There are, however, inherent limitations that should be recognized in considering the assurances provided by the internal control structure. Office of the Auditor General for the Federation, Independent Auditors, has been engaged to audit these Project's financial statements in accordance with the International Standards on Auditing. Their report is included on pages 5 to 7. APERA I RWAKWAGH BENJAMIN C. NWANZE (National Prqject Coordinator) (National Project Accountant) DATE:.2.. f. . DATE.. . ...... .. . . 4 THE AUDITOR-GENERAL FOR THE FEDERATION Audit House, Plot 273, Samuel Ademulegun Street, Central Business District, PM.B. 128, Garki - Abuja, Nigeria. The National Coordinator, National Social Safety Nets project, Vice President Office, 76 Ali Akilu Crescent, Asokoro, Abuja AUDIT OF THE NATIONAL SOCIAL SAFETY NETS PROJECT PERFORMED BY THE AUDITOR GENERAL FOR THE FEDERATION AUDITOR'S REPORT Opinion I have audited the financial statements of National Social Safety Nets Project for the year ended 31st December, 2018. These financial statements comprise the Consolidated Statement of Financial Position and Consolidated Statement of Sources and Uses of Funds 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 Consolidated financial position of the Entity as at 31st December, 2018, and of its Consolidated Statement of Sources and Uses of Funds 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. 5 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. 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. 6 * 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. 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 27, 2019 7 NATIONAL SOCIAL SAFETY NETS PROJECT P151488 CONSOLIDATED STATEMENT OF SOURCES AND USES OF FUNDS FOR THE NINE MONTHS PERIOD ENDED 31S DECEMBER, 2018 CURRENT PERIOD CUMULATIVE TO DATE CASH RECEIPTS NGR USD NGR USD IDA NASSCO 2,279,280,304.90 7,473,050.18 5,335,424,099.85 17,493,193.77 IDA NCTO j - 7,625,000,000.00 25,000,000 SWISS Restituted Funds 4,674,879,875.00 15,327,475.00 4,674,879,875.00 15,327,475.00 Counterpart Funds NASSCO - Counterpart Funds NCTO - - - Other Sources NASSCO Other Sources NCTO 1,809,060.00 5,931 1,809,060.00 5,931 TOTAL SOURCES 6,955,969,239.90 22,806,456.52 17,637,113,034.85 57,826,600.11 LESS: EXPENDITURE 1. Goods, non-consulting services, consultants' services and Training for Part 450,336,781.32 1,476,514.00 1,120,825,391.40 3,674,837.35 A. 1.(b), (d) and (e) and Part A.2(a) and (b) of the Project 2. Goods, non-consulting services, consultants' services and Training for Part 1,141,990,029.00 3,744,229.60 1,141,990,029.00 3,744,229.60 A. 1.(a) and (c), Part A.2.(c) and (d) of the Project 3. Output-based financing of Part A.1.(f) of t 223,196,230.00 731,791.00 223,196,230.00 731,791.00 the Project based on Unit Costs 4. Output-based financing of Part A.2.(e) of 438,618,157.00 1,438,092.00 438,618,157.00 1,438,092.00 the Project based on Unit Costs 5, Output-based financing of Parts B.1. of 723,378,088.00 2,372,120.00 723,378,088.00 2,372,120.00 the Project based on Unit Costs 6. Targeted Cash Transfers under Part B.2. 6 2,121,380,090.00 6,955,344.56 2,121,380,090.00 6,955,344.56 of the Project TRGT CSH TRSF - RESTITUTED FUNDS 4,052,690,130.00 13,287,508.62 4,052,690,130.00 13,287,508.62 TOTAL EXPENDITURE 9,151,589,505.32 30,005,599.78 9,822,078,115.40 32,203,923.13 RECEIPTS LESS EXPENDITURE (2,195,620,265.42) (7,199,143.26) 7,815,034,919.45 25,622,676.98 ADD: EXCH. DIFF 73,820,026.72 242,403.16 (1,394,260,192.31) (4,570,956.55) NET CHANGE IN CASH (2,121,800,238.70) (6,956,740.10) 6,420,774,727.14 21,051,720.43 Opening Balances Designated Accounts NASSCO 932,309,043.14 3,056,750.96 0.00 0.00 NCTO 889,041,154 2,914,889.00 Drawdown Accounts 8 NASSCO - S & S 795,132,951.86 2,606,993.28 0.00 0.00 NASSCO - OBD 208,135,224.84 682,410.57 0 0.00 NCTO -5 & S 3,562,912,077 11,681,697.00 NCTO - OBD 20,000.00 65.57 NCTO -CCT 2,155,024,515.00 7,065,654.15 0 0 Total Opening Cash 8,542,574,965.84 28,008,460.53 0.00 0.00 Add Net Change in Cash (2,121,800,238.70) (6,956,740.10) Net Cash Available 6,420,774,727.14 21,051,720.43 6,420,774,727.14 21,051,720.43 Closing Balances Designated Accounts NASSCO 2,324,481,073.10 7,621,249.42 2,324,481,073.10 7,621,249.42 NCTO 4,533,520 14,864.00 4,533,520 14,864.00 Drawdown Accounts NASSCO - S & S 425,423,399.30 1,394,830.82 425,423,399.30 1,394,830.82 NASSCO - OBD 424,567,593.74 1,392,024.90 424,567,593.74 1,392,024.90 NCTO - S & S 2,420,922,047.00 7,937,449.33 2,420,922,047.00 7,937,449.33 NCTO- OBD 160,561,912 526,432.50 160,561,912 526,432.50 SWISS Funds DD 626,031,612 2,052,562.67 626,031,612 2,052,562.67 NCTO - CCT 34,253,570 112,306.79 34,253,570 112,306.79 Total Closing Cash 6,420,774,727.14 21,051,720.43 6,420,774,727.14 21,051,720.43 9 NATIONAL SOCIAL SAFETY NETS PROJECT P151488 SUMMARY OF ACTIVITIES IN THE DESIGNATED ACCOUNT FOR THE NINE MONTHS PERIOD ENDED 31ST DECEMBER, 2018 Financing Agreement CR P151488 As of and for the year ended December 31, 2018 In US dollars Opening balance as of January 1, 2018 0.00 Add: Replenishment during the year 57,826,600.11 57,826,600.11 Present outstanding amount advanced to the designated account (1) 57,826,600.11 Closing balance as of December 31, 2018 21,051,720.43 Add: Amount of eligible expenditures paid during the year 32,203,923.13 Less: Adjustments 4,570,956.55 Service charges (if applicable) - 36,774,879.68 36,774,879.68 Total advance accounted for (2) 57,826,600.11 10 NATIONAL SOCIAL SAFETY NETS PROJECT P1 51488 CONSOLIDATED FINANCIAL POSITION AS AT 31ST DECEMBER, 2018 EMPLOYMENT OF FUNDS NOTES 2018 N N Development Capital Expenditure 1 9,822,078,115.40 Development Operating Expenditure 2 0 Fixed Assets ------ 3 ---- - 3 1,394,260,192.31 CURRENT ASSETS Stocks 4 0 Cash & Bank Balances 5 6,420,774,727.14 CURRENT LIABILITIES Accrued Expenses 0 Net Current Assets/(Liabilities) 6,420,774,727.14 Total Net Assets 17.637.113.03485 FINANCED BY: IDA Funds 6 12,960,424,099.85 SWISS Funds 7 4,674,879,875.00 Other Receipts 8 1,809,060.00 17,637,113.034.85 The notes to the accounts on pages 12 and 13 form part of these financial statements APERA IORWA KWr.H (NATIONAL PROJECTCOORDINATOR) ..... .. DATE:.. BENJAMIN C. NWAN (NATIONAL PROJECT ACCOUNTANT).. DATE: 11 NATIONAL SOCIAL SAFETY NETS PROJECT P151488 NOTES TO THE FINANCIAL STATEMENTS FOR THE NINE MONTHS PERIOD ENDED 31sT DECEMBER, 2018 Note 2018 2017 N N Development Capital Expenditure 1 NASSCO 1,782,639,778.40 NCTO 3,986,748,207.00 NCTO SWISS Restituted Funds 4,052,690,130.00 Total 9,822,078,115.40 Development Operating Expenditure 2 - Fixed Assets 3 NASSCO 581,905,217.41 - NCTO 812,354,974.90 Total 1,394,260,192.31 0 Stocks 4 0 0 Cash & Bank Balances 5 Designated Accounts NASSCO 2,324,481,073.10 NCTO 4,533,520.00 Drawdown Accounts NASSCO - S & S 425,423,399.30 NASSCO - OBD 424,567,593.74 NCTO - S & S 2,420,922,047.00 NCTO - OBD 160,561,912.00 SWISS Fund Drawdown 626,031,612.00 NCTO -CCT 34,253,570.00 Total Closing Cash 6,420,774,727.14 0 12 NATIONAL SOCIAL SAFETY NETS PROJECT P151488 NOTES TO THE FINANCIAL STATEMENTS CONT'D FOR THE NINE MONTHS PERIOD ENDED 31 sDECEMBER, 2018 Notes 2018 2017 N N IDA Funds 6 NASSCO 5,335,424,099.85 NCTO 7,625,000,000.00 NASSCO - Counterpart Funding NCTO - Counterpart Funding SWISS Funds 7 NASSCO NCTO - Restituted Funds 4,674,879,875.00 Other Receipts 8 NASSCO NCTO 1,809,060.00 - Total Funding 17,637,113,034.85 0 13