{'A 22 2c¢zoq h158-¢ Phone 0135-2644050 State Water & Sanitation Mission Fax 0135-2643727 (Department of drinking water & sanitation, Govt. ofUttarakband) The Institution of Engineers (India) e.mail swsm.uttarakhand@gmail.com First Floor, Opposite Inter State Bus Terminal (ISBT) swsm_uttarakhand@rediffmail.com Saharanpur Road, Majra, Dehradun, Uttarakhand Letter No. 5 /PU-28/2019 Dated: }7 September, 2019 To, Director Department of Economic Affairs Ministry of Finance Government of India North Block New Delhi. Subject: - Audited Statement of Accounts for the Financial Year 2018-19 of "Uttarakhand Water Supply Program for Peri-Urban Areas" IBRD Loan No. 8805-IN. Sir, With reference to Para II (ii) of Disbursement & Financial Information Letter (DFIL) regarding Financial Report and Audits for IBRD Loan No. 8805-IN, please find enclosed herewith the audited financial statements for Uttarakhand Water Supply Program for Peri-Urban Areas for the Financial Year 2018-19. Yours faithfully Enclosure: As above / (P. K. Joshi) Finance Controller Copy to : 1. The Controller, Aid Accounts & Audit, Department of Economic Affairs, Ministry of Finance, Govt. of India, Janpath Bhawan, 5° Floor, B-Wing Janpath, New Delhi- 110 001. 2. Dr. Smita Mishra, Task Team Leader, UWSP for Peri_Urban Areas, The World Bank, N Delhi Office, 70, Lodi Estate, New Delhi 110 003. Krishnamurthy, Senior Financial Management Specialist, The World Bank, New Delhi Office, 70, Lodi Estate, New Delhi 110 003. h2 H.O. : 54,Meedo Complex, Near Saharanpur Chowk Goyal Parul &% Co. DEHRADUN- 248 001, Uttarakhand, Ph.: 91-9811324387, 9899612242 Chartered Accountants B.O. :#78,J Extension, 3¢ Floor, Near Guru Ramdass Nagar School Laxmi Nagar, DELHI-110092, Ph. 011-22451632, Fax: 011- 22057847 E-mail: capgoyal@gmail.com, goyalgoyal_p@rediffmail.com Independent Auditor's Report To, The Project Director Uttarakhand Water Supply Program for Peri-urban Areas First Floor, The Institution of Engineers {India) Building Near ISBT, Saharanpur Road, Majra, Dehradun Report on the Audit _of _the _Project Financial Statements Opinion We have audited the accompanying special purpose financial statements of Uttarakhand Water Supply Program for Peri-urban Areas (the Project) financed by the International Bank for Reconstruction and Development (IBRD) under Loan IN-8805 and implemented by State Program Support Unit. These financial statements comprise of the Balance Sheet along with detailed schedules, Income & Expenditure Accounts along with detailed schedules, Sources & Uses of Program Fund and notes to these financial statements, including a summary of significant accounting policies (collectively referred to as the "Project Financial Statements"). In our opinion, the aforesaid special purpose Project Financial Statements give a true and fair view of the financial position of the Project as at March 31, 2019, income and expenditure statement, receipts and disbursements of the Project for the year ended on. March 31, 2019 and the expenditure of the Project for the year ended on March 31, 2019, in accordance with the financial reporting provisions of Section 5.09 of the General Conditions of the World Bank read with the Loan Agreement and Project Agreement both dated January 22, 2018 Basis for Opinion We conducted our audit in accordance with the Standards on Auditing issued by Institute of Chartered Accountants of India (ICAI). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the implementing agency in accordance with the ICAI's Code of Ethics for undertaking this assignment, and we have fulfilled our ethical responsibilities in accordance with ICAI's Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Emphasis of Matter We draw attention to Schedule of Significant Accounting Policies and Notes to Accounts to the PFS describing the basis of accounting. The PFS is prepared to assist the State Program Support Unit to meet the financial reporting requirements of the Program Loan A reements dated January 22, 2018 in respect of preparation of the Program Financial Stat :j1ehts:in,s manner to reflect the operations, resources and expenditures related to the P~~ . . ~s a result, these special Other Branch Offices: ®r 9_ %-,° i, 777777 <{9 +ff±' ; Gurgaon, Noida, Pune, Mumbai, Banglore, Chandigarh, Bhopal, Lucknow, Guwahati, Indore, Luh d iana, Nagpur, Jabalpur, j Surat, Jamshedpur, Ramgarh, Bhagalpur, Rowta, Amravati purpose financial statements may not be suitable for another purpose. Our opinion is not modified in respect of this matter. Responsibilities of Management and those charged with Governance for the Project Financial Statements The Management of the implementing agency is responsible for the preparation and fair presentation of the Project Financial Statements in accordance with the financial reporting framework described in Schedule of Significant Accounting Policies and Notes to Accounts to these financial statements, and for such internal control as management determines is necessary to enable the preparation of Project Financial Statements that are free from material misstatement, whether due to fraud or error. The Management and those charged with governance are responsible for overseeing the implementing agency's financial reporting process. Auditor's _Responsibilities _for the Audit of _the Project Financial Statements Our objectives are to obtain reasonable assurance about whether the Project 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 our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with the Standards of Auditing 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 Standard of Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: • identify and assess the risks of material misstatement of the Project 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 our 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 control. • obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. • evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. • evaluate the overall presentation, structure and content of the Project Financial Statements, including the disclosures and whether these financial statements present the Project's operations andunderlying transactions and events in a manner that achieves fair presentation in accordance with the financial reporting provisions described in Schedule of Significant Accounting Policies and Notes to Accounts to the Project Financial Statements. ? aru/ e • communicate with those charged with governance regarding, amor ;theratters, mthe planned scope and timing of the audit and significant audit fi · ~ ~Q&~i~g any significant deficiencies in internal control that we identify during our ldit.} ]] 9, { ./, \@reg A@> "·4 .0A0case • provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. Other Matter Report on Other Legal and Regulatory Requirements Further to our opinion on the Project Financial Statements we further report that: a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; b) in our opinion, proper books of accounts have been kept by the implementing agency for Project purposes so far as appears from our examination of those books; c) the Project Financial Statements dealt with by this report is in agreement with the books of accounts; d) the Project funds were utilized for the purposes for which they were provided; e) expenditures, including assets created under the Project, shown in the PFS are eligible for financing under the Project Financing Agreements; f) Interim Financial Reports (IFR) submitted by the Project management can be relied upon to support applications for withdrawal of the Loan, and adequate supporting documentation has been maintained to support these claims; g) Procurement has been carried out in line with the agreed procedures as detailed in the Operations Manual/Procurement Manual/Project Implementation Plan/Legal Agreements. We report that there were no contract awarded during the audit period having work contract value of more then US $b 75 million, goods contract value of more then US$ 50 million and consultancy contract value of more then US$ 20 million. h) the Project has an adequate internal financial control system (including IT controls)and such controls were operating effectively as at March 31, 2019 and the Project complies with the provisions on financial management contained in the Operations Manual/Project Implementation Plan/ Financial Management Manual, in all material aspects For Goyal Parul and Company Chartered Accountants Firm's Registration No. 016750 N ./ ? so } Dayanand deepak Partner .l e+ed 'Membership No. 518811 Place of Signature: Dehradun Date: 11.09.2019 UDIN No -19518811AAAAAl7199 STATE PROGRAM SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Maira, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS CONSOLIDATED BALANCE SHEET AS AT MARCH 31,2019 A FUNDS EMPLOYED Accumulated Fund Opening Balance 6,32,65,882.90 Add: Fund from State Govt. of Uttarakhand 20,00,00,000.00 10,00,00,000.00 Add: Fund from Uttarakhand Investment Project Development Facility trfd. To UWSP for Peri Urban Areas 54,47,838.00 Add: Fund from GoUK through PMU for DPR Preparation UWSP fo Peri Urban Areas 1,00,00,000.00 26,32,65,882.90 11,54,47,838.00 Less:Transferred to Income and expenditure account being Grant fund utilised during the year 17,48,51,491.00 8,84,14,391.90 5,21,81,955.10 6,32,65,882.90 B. REPRESENTED BY Current Assets Advances to Contractors/Suppliers Advances to Staff 2,59,457.00 Others Receivables 5,63,85,022.00 2,51,929.00 Cash at Bank 4,28,71,269.18 9,88,47,709.00 Cash in Hand Subtotal : Current Assets 9,95,15,748.18 9,90,99,638.00 Less : Current Liabilities i Security Payables 1,66,166.00 Payable-Satutory Deduction 5,85,670.00 Interest earned on Bank Ale payble to State Govt. 22,17,936.28 7,06,764.10 Payable to Contractor/Suppliers 3,12,710.00 2,81,858.00 Payable Others 78, 18,874.00 3,48,45,133.00 Subtotal : Current Liabilities 1,11,01 ,356.28 3,58,33,755.10 NET CURRENT ASSETS 8,84, 14,391.90 6,32,65,882.90 On behalf of the State Program Support Unit UDAY Proara» irector FILb. rtro:Jo . • r· '"- , . 1- );>rQg. ,·-~c~o~ -~ g ·ST Utfaaxhatu Yale1 Ui5 + '£g7am r% · {lranoos» frr6ir "As per our separate report of even date." Place: Dehradun Partner: Dayanand Dee Date: 11.09.2019 Membership No. : 5188 , FRN :016750N ..< STATE PROGRAM SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Majra, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS CONSOLIDATED STATEMENT OF INCOME & EXPENDITURE FOR THE PERIOD FROM 01.04.2018 TO 31.03.2019 INCOME Other Income: Miscellaneous Income 1,46,446.00 1 39,323.00 I Grant utilised during the year transferred from Balance Sheet 17,48,51,491.00 5,21,81,955.10 EXPENDITURE UWSP Expenditure : Improved W/s System in Peri-Urban Areas A 13,48, 11,734.00 3,66,71,672.00 Improved Policy for GoUK's W/s Program for Peri- Urban Areas B Strengthened M&E System for GoUK's W/s Program for Peri-Urban Areas C 9,03,997.00 Preparation of Master Plan for Peri Urban Areas D 6,23,984.00 Technical & Program Management Support E 3,21,54,195.00 88, 70,277.10 Strengthening Program Governance and Accountability F Technical Assessments and Studies G 62,55,218.00 63,67, 101.00 Capacity Building and Training Programs H 2,48,809.00 3,12,228.00 Contingencies 17,49,97,937.0 0 5,22,21,278.10 On behalf of the State Program Support Unit UDAY RAJ SINS; Pr~m Dire tor Uttaa3:_±} 4 ,g; ''Prot Director Pr: <. AUDITORS' REPORT "As per our separate report of even date." For Goyal Parul & Co. Chartered Accoun n Place:Dehradun Date: 11.09.2019 fee Partner: Dayanand Dee • Membership No. :51881 FRN : 016750N STATE PROGRAM SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Majra, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS CONSOLIDATED STATEMENT OF SOURCES & USES OF FUNDS FOR THE PERIOD FROM 01.04.2018 TO 31.03.2019 Sources of Funds a) Opening Cash & Bank balances 9,88,47,709.00 0.00 b) Funds received State Govt. 20,00,00,000.00 11,54,47,838.00 c) Miscellaneous Receipts 1,46,446.00 39,323.00 d) Increase in Current Liabilities 0.00 3,58,33,755.10 e) Decrease in Current Assets 0.00 0.00 Uses of Funds a) Expenditure on the Project_: Improved W /s System in Peri-Urban Areas (i) 13,48, 11,734.00 3,66,71,672.00 Improved Policy for GoUK's W/s Program for Peri- (ii) Urban Areas 0.00 0.00 Strengthened M&E System for GoUK's W /s Program (iii) for Peri-Urban Areas 9,03,997.00 0.00 Preparation of Master Plan for Peri Urban Areas (iv) 6,23,984.00 0.00 Technical & Program Management Support (v) 3,21,54, 195.00 88, 70,277.10 Strengthening Program Governance and Accountability (vi) 0.00 0.00 Technical Assessments and Studies (vii) 62,55,218.00 63,67,101.00 Capacity Building and Training Programs (viii) 2,48,809.00 3,12,228.00 Contingencies (ix) 0.00 0.00 b) Increase in Current Assets 5,63,92,550.00 2,51,929.00 c) Decrease in Current Liablities 2,47,32,398.82 0.00 d) Closing Cash & Bank balances 4,28,71,269.18 9,88,47,709.00 Accountant ®"»tr'sti urge.s e±fro "control@' 3 1 8 1% 4. , 7 Utta ak/3AUDITORS' REPORT <4 D»>+q7) Finance "As per our separate report " For Goyal Parul & Co. Chartered Accountant Place:Dehradun Partner: Dayana Date: 11.09.2019 Membership No. 5188 FRN : 016750N STATE PROGRA M SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Majra, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS SCHEDULE FORMING PART OF INCOME & EXPENDITURE FOR THE PERIOD FROM 01.04.2018 TO 31.03.2019 Schedule-A Improved W/s System in Peri-Urban Areas· DPR Preparation Cost 13,43,33, 799.00 3,66,71,672.00 Water Supply Scheme Cost 4,77,935.00 13,48, 11,734.00 3,66, 71,672.00 Schedule-B Improved Policy for GoUK's W/s Program for Peri-Urban Areas Consultancy Services for Improvement of W/s System Printing & Distribution for Improvement of W/s System Other Cost for Improvement of W/s System 0.00 Schedule-C Strengthened M&E System for GoUK's W/s Program for Peri-Urban Areas Design & implementation of M&E System Consultancy Service for development of M&E System 3,07 ,995.00 Hardware & Software for M&E System 5,96,002.00 Upgradation of MIS System Other Cost for Strengthening of M&E System 9,03,997.00 0.00 STATE PROGRA M SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Majra, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM .FOR PERI URBAN AREAS SCHEDULE FORMING PART OF INCOME & EXPENDITURE FOR THE PERIOD FROM 01.04.2018 TO 31.03.2019 Schedule-D Preparation of Master Plan for Peri Urban Areas Consultancy Services for preparation of Master Plan 6,23,984.00 Printing & Distribution Other Cost for Related to Master Plan 6,23,984.00 0.00 Schedule-E Technical & Program Management Support Salary of Govt. Employees 1,79,34,465.26 15,31,898.00 Salary of Support Staff 26,09, 739.24 50,67,678.00 Remeneration of Individual Consultants 24,88,835.00 17,31,789.00 Other Administrative Expenses 75,70,317.50 5,05,901.10 Procurement of Computer Hardware 13,47,465.00 Procurement of Computer Software Procurement of Office Equipment 33,011.00 Procurement of Office Furniture & Fixtures 2,03,373.00 Procurement of Vehicles 3,21,54, 195.00 88,70,277.10 STATE PROGRA M SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Majra, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS SCHEDULE FORMING PART OF INCOME & EXPENDITURE FOR THE PERIOD FROM 01.04.2018 TO 31.03.2019 Schedule-F Strengthening Program Governance and Accountability Independent verifications Agency Cost Third Party Quality Assurance Technical Audits Social Audits Financial Audits Establishment of Grievance Redressal Mechanism Establishment of Citizen Engagement Program Implementation of Governance and Accountability Action Plan Third Party Construction Supervision 0.00 Schedule-G Technical Assessments and Studies Baseline Survey of Households and other Institutions in Peri-Urban Areas 41,84,610.00 19,51,951.00 Study on PPP Policy & Frameworks for Peri- Urban Areas 3,93, 120.00 Technical Manual for Peri-Urban Areas Financial Management Manual for UWS Program for Peri-Urban Areas Procurement Manual for UWS Program for Peri-Urban Areas Standard Operating Procedure Transaction Advisory Services for PPP 16,77,488.00 Other studies- Communication Program/Capacity Building/PPP Model 62,55,218.00 44, 15,150.00 63,67, 101.00 STATE PROGRA M SUPPORT UNIT The Institution of Engineers (India), 1st Floor, Opposite ISBT, Saharanpur Road, Majra, Dehradun UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS SCHEDULE FORMING PART OF INCOME & EXPENDITURE FOR THE PERIOD FROM 01.04.2018 TO 31.03.2019 Schedule-H Capacity Building and Training Programs Strengthening Swajal Pathshala; Training Program for Stakeholders 1,50, 156.00 3,12,228.00 IEC Activities 98,653.00 2,48,809.00 3, 12,228.00 UTTARAKHAND WATER SUPPLY PROGRAM FOR PERI URBAN AREAS CONSOLIDATED STATE PROGRAM SUPPORT UNIT Financial Year 2018-19 SCHEDULE OF SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS SIGNIFICANT ACCOUNTING POLICIES A. CONVENTION The financial statements of the SPSU & PIU s are prepared under the historical cost convention in accordance with generally accepted accounting principles, on cash basis. B. FIXED ASSETS The Fixed Assets are taken under revenue head for the project at cost but capitalized in the General Ale of respective agencies, which comprises of purchase price (net of rebates and discounts) duties, levies (net of duty drawbacks and subsidies) and any attributable cost of bringing the assets to their working condition. C. DEPRECIATION The SPSU is following a policy of charging depreciation on the fixed assets on prorata basis. The rate of Depreciation are as provided under the Income Tax Act, 1961 and the same are consistently followed. NOTES TO ACCOUNTS 1. Interest received on Project funds upto the financial year 2018-19 aggregating to Rs. 22,17,936.28 being payable to Government account has been shown as current liability, as this amount is to be deposited in State Government fund. 2. Previous Year figures have been regrouped and reclassified wherever necessary. 3. The program reporting requirements are outlined in the Loan Agreement and Project Agreement. The financial reporting requirements including audit submission is outlined in the DFIL dated January 22, 2018. 4. As this is a PforR, the overall program expenditure will be reconciled to the overall disbursements from the IBRD and adjustments, if any will be carried out in the last year of the Program. 5. During FY 2018-19, the overall Program expenditure was Rs.17.50 Crores, which is more than the disbursement of USD 1 Million (equivalent to Rs. 7.09 Crore) for achievements of DLis. Amount Reimbursed SI.No. Category Year of DLI Amount Amount Acheivemen (In US$) (In INR) 2 3 4 5 6 DU # 4: Strengthen program M&E Year 1 M&E Plan systems in peri-urban areas Acheivemen Prepared 10,00,000.00 7,09,05,300.00 Total 10,00,000.00 7,09,05,300.00 UDAYlRAJ SINGH Fin ~ troller Projsst7#ec S P.K. Joshi Uttaakhand Water Supply Program Finance Controll@: FOR Goyal Parul & Co. CHARTE~UN TT_DI-~ (Dayanand Deepak Partner • Date: 11.09.2019 Membership No. 51881 Place:Dehradun FRN 016750N