nc?m lmdz ,Igif yed k I uhal Vtivekcu i .vaplju viLtU Project Name: IDF Grant for strengthening the use of Country Safeguards System Project Implementing Entity: National Environnient Management Authority PROJECT GRANT/CREDIT NUMBER: TF012609 ANNUAL REPORT AND FINANCIAL STATEMENTS FOR TILE FINANCIAL YEAR ENDED JUNE 30, 2017 Prepared in accordance vitlh the Cas[i Basis of Accounting Method under tie Jiteruaional Public Seefor Accounting Standards (IPSAS) Kenya IDF, Strengthelning the Use of Counlrv Safeguards Systens Project Reports and Financial Statemients iFor tile financial y'ear ended hue 2017 CONTENTS PAGE S 1. PROJECT INFORMATION AND OVERALL PERFORMANCE ................................................................................1 2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBIL TIES ......................................................................vi 3. STATEMENT OF RECEIPTS AND PAYIvENTS FOR THE PERIOD ENDED 30TH JUNE2017 ....................... 4. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 20 7..........,............................ 2 6. STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS .........................................-................. 7. NOTES TO TH E FIN AN CIA L STATEM EN TS............E.M...............................,............................................................. 8. PROGRESS ON FOLLOW UP OF AUDITOR RRE COMMENDATIONS ............................................................. 11 Kenva IDFJStre'ngth,en ing the Use of Country Sajéguards SyStens Pr-oject Reports and Financial Statements For the financialyear' en ded June 2017 l. PROJECT INFORMATION AND OVERALL PERFORMANCE 1.1 Name and registered office Name: Kenya IDF Sirengthening the Use of Country Safeguards Systern Project. Objective: The key objective of the project is to strengthen the assessnent, implementation, and nonitoring and evaluation capacity of national safeguard practitioners in the Lise of the IMeimber Country's environmental and social safeguards country systems. Address: The project headquarters offices are Nairobi, Kenya. Popo Road, off- Mombasa Road The address of its registered office is: P.O. Box 67839-00200 Nairobi Contaets: The following are the project contaets 'Iclephone: (254-20) 6005522/3/6/7 E-mail: dgnema@nema.go.kc Website: www.nema.go.ke 1.2 Project Information Project Start Date: The project start date is 13/05/20 13 Procct End Date: The project end date is 13/05/2016 Project 4anager: 'The project manager is lvi Zcphainiah Ouma Project Sponsor: The project sponsor is International Bank for Reconslriiction and Development (World Bank) 1.3 Project Overview State Department of National Environment Management Authority (NEIA) the project ProJect number 1012609 StrategIC goals o theC ie strategic goals of the project are as rollows: project 1) Developing a resuis-based environmental and social Safeguards managemen fraimework. 2) Strengthening country systems capacity in environinental and social saf'eguards managemfnient. 3) Carryig out the effective management of the granL Achievernent of The project mnana-ngement ains to achieve the goals throughi he oluowinu ¯ strateg:- g als Ieans: Kenya IDF Strengftening fie Use of Countty Safeguards Systems ProÌec Reports and F'inanicl Siateewnts For tlie .financialycar entl Jute 30, 2017 1) Carrying out a diagnostic assessment to ascertain existing safeguards capacity within targeted ministries. 2) Preparation of a consolidated safeguards managenent franiework to establish a clear and standardized approach to national safeguards work. 3) Preparation of an operational manual providing guidance on how to effectively conduct a safeguards assessment and evaluation procedures. 4) Development and production of learning modules ffor safeguards praetitioners. 5) Provision of training in the areas of environmental and social safeguards management. 6) Carrying out a local workshop for international safeguards.practitioners from other Sub-Saharan African countries. 7) Carrying out the design, produution and distribution of Icarning and communication inaterials and participatory learning sessions [or meminbers of the civil society. - Other important The project will mainly address environmieLtal and social systems. This is background by developing standard tools of undertaking comprehensive public and information o the private participation as weil as building the capacity of stakeholders to projet enable them to participate in an informed nanner in project design and development. Current situation that Kenya faces numerous environmental and social risks associated with large- the project was scale investment and development programumes. These ineludes; lack of formed to intervene standardized tools for stakeholder's engagement, inadequate public participation. inadequate civil 4ociety eagerent, inadequaie capacity anorig the environmental im-npact aIssessment and environnmental audit experts (EIA/EA) , inadequate institutional consultation and cooperation. The grant aims at assisting the Government of Kenya to sircngthen instititional capacity and human resource skills in Country Safeguards Systems Management. It wNill therefore improve the development impact, inerease country ownership, strengthen in-country institutional capacity to aderess core safeguards consideratios and enhance cost effeetiveness of the country's investnient and development programmes. ProjeCt dturation The projeet started on 13/05/2013 and is expected to run until 13/05/2016 1.4 Bankers The following are the bankers for the current year: None - The project is financed through reimbursement and direct payment. 1.5 Auditors The project is audited by the office of the: Auditor General. P.O Box 30084-00100 ii Keny'a IDF Strengathening the Use of Cozuitry Safeguards Slystems Projecf Reports and Financial Statemnents For the financial year ended June 30, 2017 Nairobi, Kenya 1.6 Roles and Responsibilities Names Title Key qualification ResPonsibilities Svet]ana Khvostova Task Tearn Leader. - Overall project leadership and coordination. Gibwa Kaj ubi Co-Task Team - Overall project Leader. leadership and coordination. Prof Geoffrey Director General. Doctor of Philosophy Overall project Wahiingu direction and leadership£. Ochieng Ochuka Steering Committec MBA Finance Overall coordination, member. monitoring ad --evaluation of grant. Amb. Magdalene J. Steering Committee - Overall coordination, Wambua meiber. mlonitoring and evaluation of grant. Eng. Tom Ogala Steering Committee - Overall coordinationi. memliber, monitoring and _evaluation of grant. David K Rono Stecring Commitee - Overall coordination. member. monitoring and evaluation of grant Eng. Isaac N Kiva Steering Committee - Overnl coordination: member. monitoring and evaluation of grant. Julius Kirima Steering Commin1ee - Overall coordinatiori, nber. :noitoriig and evaluation_ ofrrant. Abel Chumba Steering Committee Overall coordination, memibr. monitoring and evaluation of grant -- John D MuLsale Steering Committee -Overali coordination. membr. moniltoring and __ evahliation of grant. Kennedy Calvin Steering Coimiiiietce - Overall coorcliatiiin, Nyamio memcr. monitoring and evaluation oi 'rant. ZcpIhanialh Ouma Project Coordinator Master of Science. Project coordination. Oscar Baraza Aweri Procrement Officer MSc. Procurenent In chare of grant and Contract procureinct funcion. L _________________________________ Managemnent. iii Kenya IDF Strengtiening the Use oj Country Safeguards Systems Project R 1epors and Financial Statements For tlie.financial year ended Jne 30, 2017 Solomon Karanja Project Internal MSc. Finance and In charge of Internal Auditor Economics. projct audit. Alphonse Omollo Project Accountant MBA Accournting. in charge of the [inance function. Oceanic Sakwa Project Seeretariat BSC. Botanv & Assist in projeci Zoology. i mpL enientation. Reagan Awino Project Sceretariat BA Urban and Assist in project Regional Planning. irnpleientlatian. Josephine Njoroge Project Secretary - Assist in project implementation. 1.7 Funding summary The Project is for duration of 3 years from 2013 o 2016 with an approved budget of USS 487,880 (usa dIanor currency) equivalent to Kshs 49,178,310 as highlighted in the table below: Below is the funding sumiary: (Eti) tw _ __ International Bank fo r 487,880 49,178,310 242,084 24,402,070 245,796 24,776,240 Reconstruction and Development (World Bank) Total 487,880 49,178,310 242,084 24,402,070 245,796 24,776,24 1.8 Summary of Overall Project Performance: Due to the dlelay in the proJect commiieneenpt and the time constraint, thiree conisuiltanies wvere comlbinied into one andl the contract thirouighi a comipetiVe PrOcurmn procss wvas awvarded to Aquac[ean Services Limited. The deliverables were an inception report, nal diagnostic assesstent reotand stnadzdlearning tools. These were all cornpleted and approvedl by the- steering Comnmitioa l ebers. Only on direct pay8ent of Ks1s 204,402,070 wvas ade to the project consulant. This was 501 ofthe grant funds. T.e remainmig part of e project, traning of trainers, could not be undertaken due to the lapse of tine tano extension of the projec after celosire danjte iv Kenya IDF Strengthening the Use of Country Sqfeguardls Systems Project Reports and Financial Slatements Fot' thefinan cial year ended June 30, 2017 1.9 Summary of Project Compliance: The project was initially signed between NEMA and the World Bank in May 2013. For regulation purposes and as per the required procedures, the contract was subsequentiy signed between the World Bank and the Government of Kenya through the Treasury in June 2014. This formalization delayed the implenentation of the project and thus missed out in the budget for 2015/2016 and was also not factored in the 201512016 supplementarv estimates. Subsequently, an authority to spend was granted by the National Treasury on 8"' September 2016 as grant A.A and the same regularised in the supplenientary estiiates for the financial year 2016P017. This enabled a direct payment of Kshs. 24,402,070 to be made by the World Bank through the National Treasury to the project consultant (Aquaclean Services Limited). m.,I Kenya IDF Strengthening the Use of Country Safeguards Systems Project Reports and Financial Statements For the financial year ended June 30, 2017 2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES The Accounting officer and the Project Coordinator for Kenya IDF Strengthening the Use of Country Safeguards Systems Project are responsible for the preparation and presentation of the Project's financial statements, which give a true and fair view of the state of affairs of the Project for and as at the end ofthe financial year (period) ended on June 30, 2017. This responsibility includes: (i) maintaining adequate financial management arrangement and ensuring that these continue to be effective throughout the reporting period; (ii) maintaining proper accounting records, which disclose with reasonable accuracy at any time the financial position of the Project; (iii) designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of the financial statement, and ensuring that they are free from material misstatements, whether due to error or fraud; (iv) safeguarding the assets of the Project; (v) selecting and applying appropriate accounting policies; and (vi) making accounting estimates that are reasonable in the circumstances. The Accounting Officer and the Project Coordinator for Kenya IDF Strengthening the Use of Country Safeguards Systems Project accept responsibility for the Project's financial statements, which have been prepared on the Cash Basis Method of Financial Reporting, using appropriate accounting policies in accordance with International Public Sector Accounting Standards. The Accounting Officer and the Project Coordinator for Kenya IDF Strengthening the Use of Country Safeguards Systems Project are of the opinion that the Project's financial statements give a true and fair view of the state of Project's transactions during the financial year/period ended June 30, 2017, and of the Project's financial position as at that date. The Accounting Officer and the Project Coordinator for Kenya IDF Strengthening the Use of Country Safeguards Systems Project further confirm the completeness of the accounting records maintained for the Project, which have been relied upon in the preparation of the Project financial statements as well as the adequacy of the systems of internal financial control. The Accounting Qfficer and the Project Coordinator for Kenya IDF Strengthening the Use of Country Safeguards Systems Project confirm that the Project has complied filly with applicable Government Regulations and the terms of external financing covenants, and that Project funds received during the financial year/period under audit were used for the eligible purposes for which they were intended and were properly accounted for. Approval of the Project financial statements The Accounting Officer and the Project Coordinator for the Kenya IDF Strengthening the Use of Country Safeguards Systems Project on 2 _ _ 017 and signed by them. Accounting Officer - Proje Coor ina I Prof. Ge6ffrey Wahungu Zeph' niah Oumn vi REPUBLIC OF KENYA Telcphonc: 251-20-342330 P.O. Box 30084-00100 Fax: +254-20-3 1148A2 a o kya.go. ROBI OFFICE OF THE AUDITOR-GENERAL REPORT OF THE AUDITOR-GENERAL ON STRENGTHENING THE USE OF COUNTRY SAFEGUARDS SYSTEM PROJECT FOR THE YEAR ENDED 30 JUNE 2017 - NATIONAL ENVIRONMENT MANAGEMENT AUTHORITY REPORT ON THE FINANCIAL STATEMENTS Opinion I have audited the accompanying financial statements of Strengthening the Use of Country Safeguards System Project set out on pages 1 to 12, which comprise the statement of financial assets and liabilities as at 30 June 2017, and the statement of receipts and payments, statem6nt of cash flows and statement of comparison of budget and actual amounts for the year then ended, and a summary of significant accounting policies and other explanatory Information in accordance with the provisions of Article 229 of the Constitution of Kenyaiand Section 35 of the Public Audit Act, 2015 and the IDF Grant Agreement No. TF012609. I have obtained all the information and explanations which, to the best of my knowledge and belief, were necessary for the purpose of the audit. In my opinion, the financial statements present fairly, in all material respects, the financial position of Strengthening the Use of Country Safeguards System Project as at 30 June, 2017, and of its financial performance and its cash flows for the year then ended, in accordance with International Public Sector Accounting Standards (Cash Basis) and comply with IDF Grant Agreement No. TF012609 that establishes the Project. Further, as required by Article 229(6) of the Constitution, I confirm that public money has been applied lawfully and in an effective way. Basis for Opinion The audit was conducted in accordance with International Standards of Supreme Audit Institutions (ISSA]s). I am independent of Strengthening the Use of Country Safeguards System Project in accordance with ISSAI 30 on Code of Ethics. I have fulfilled other ethical responsibilities in accordance with the ISSAI and in accordance with other ethical requirements applicable to performing audits of financial statements in Kenya. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key Audit Matters Key audit matters are those matters that. in my professional judgment, are of most significance in the audit of financial statements. There were no Key Audit Matters to report in the year under review. Rep rtqfte 11di0l-G'llT11 07 /W Filll'id S WM'11 10lit1,,yt/W ( A'I)/Cm tl . tiil"Ifrd .'slll 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 International Public Sector Accounting Standards (Cash Basis) 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 Project's ability to sustain its services, disclosing, as applicable, matters related to sustainability of services and using the going concern assumption unless the management either intends to terminate the Project or cease operations, or have no realistic alternative but to do so. Management is also responsible for the submission of the financial statements to the Auditor-General in accordance with the provisions of Section 47 of the Public Audit Act 2015. Those charged with governance are responsible for overseeing the Project's financial reporting process. Auditor-General's Responsibilities for the Audit of the Financial Statements The audit objectives are 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 in accordance with the provisions of Section 48 of the Public Audit Act, 2015 and submit the audit report in compliance with Article 229(7) of the Constitution. 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 or weakness 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 conducted in accordance with ISSAls, I exercise professional judgement and maintain professional skepticism 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 control, Repor oftfhi Jit It-or -eneral on the FilIMIChI SlUfinan-cia a ns of t th s ol'( nto l Su/lcguarls SIVem Project foe a edeld 30hJne 2r// at Ntmnl En1ironment anm( nt AlZf;(uwthorit, 2 * 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 Project's internal control. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management. * Conclude on the appropriateness of the 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 Project's ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in the 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 audit report. However, future events or conditions may cause the Project 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. * Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities to express an opinion on the financial statements. * Perform such other procedures as I consider necessary in the circumstances I communicate with the management regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that are identified during the audit. I also provide management with a statement that I have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards. FCPA Edward R. 0. Ouko, CBS AUDITOR-GENERAL Nairobi 29 December 2017 Report of the audiror-General/on the Fintnciai Sicamenus of SUengting the Urc q Coun SaLaguard sxw Projeci jor the year ended 30 June 20 National Envir;nmeni MIara4emeni .(whrir.1 3 Kenya IDFStrengthening the Use of Couutry Safeguards Systems Project Reports and Financial Statements For thefinancial year ended June 30, 2017 3. STATEMENT OF RECEIPTS AND PAYMENTS FOR THE PERIOD ENDED 30TH JUNE 2017 2016/2017 Cumulative to date Receipts and Receipts and Payments Payments made controlled by the Entity by third parties Kshs Kshs Kshs Note Receipts Proceeds from foreign grant 7.3 24,402,070 24,402.070 Total receipts 24,402,070 - 24,402,070 Payments Purchase of services 7.4 24,402,070 24,402,070 Total payments 24,402,070 - 24,402,070 Surplus/Deficit for the Year - - The accounting policies and explanatory notes to these financial statements are an integral part of the financial statements. Accounting OPnicer Proje t 00 inat( Prof. Geoffrey Wahungu Zeph niai'Qu 1t Kenya IDF Strengthening the Use of Coutty Safeguards Systems Project Reports and Financial Statements For the financial year ended June 30, 2017 4. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 2017 Note 2017 Kshs FINANCIAL ASSETS Cash and Cash Equivalents Bank Balances 7.5 TOTAL FINANCIAL ASSETS - REPRESENTED BY: Cash and cash equivalents b/f-vd Surplus/Deficit for the year - NET FINANCIAL POSITION The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. The financial statemen ea-Wr e ved on 2 ' 2017 and signed by: Accounting Officer Project oo inator Date Date Kenya IDF Strengthening the Use of County Safeguards Systems Project Reports and Financial Statements For the financial year ended June 30, 2017 5. STATEMENT OF CASHFLOW FOR THE PERIOD 30" JUNE 2017 2017 Note Kshs Receipts for operating income Proceeds from domestic and foreign grant 7.3 24,402.070 Payments for operating expenses Purchase of services 7.4 (24,402,070) Net cash flow from operating activities CASHFLOW FROM INVESTING ACTIVITIES Net cash flows from Investing Activities CASHFLOW FROM FINANCING ACTIVITIES Net cash flow from financing activities NET INCREASE IN CASH AND CASH EQUIVALENT - Cash and cash equivalent at BEGINNING of the year Cash and cash equivalent at END of the year The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. The entity financial statiintswL appro ,ed on. 2- 2017 and signed by: Accounting Officer PRc cord atoi- Date Dat Kenya IDF Strengthening the Use of Country Safeguards Systems Project Reports and Financial Statements For the financial year ended June 30, 2017 6. STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS Actual on % of Budget (USD) Raic Budget (KSIIS) Conparable Basis [ Variance (KSilS) Varince UNEP BUDGET LINE Receipts Proceeds from foreign grant 487,880 100.80 49,178,310 24,402,070 (24,776,240) -50% Total receipts 487,880 49,178,310 24,402,070 (24,776,240) Payments Other Payments 27,500 100.80 2,772,000 - 2,772.000 100% Purchase of services 460,380 100.80 46,406,310 24,402,070 22,004,240 47% Total Payments 487,880 49,178,310 24,402,070 24,776,240 Note: The significant budget utilisation/performance differences in the last column are explained in Annex 1 to these financial statements. Accounin 0 ffic9r Project Coordi tor DateD 4 KCenya IDF Strengthening the Use of Country Safeguards Systems Project Reports and Financial Statements For the financial year ended June 30, 2017 7. NOTES TO'1HE FINANCIAL STATEMENTS The principal accounting policies adopted in the preparation of these financial statements are set - out below: 7.1 Basis of Preparation 7.7.1 Statement of compliance and basis of preparation The financial statements have been prepared in accordance with Cash-basis IPSAS fimancial reporting under the cash basis of Accounting, as prescribed by the PSASB and set out in the accounting policy note below. This cash basis of accounting has been supplemented with accounting for; a) receivables that includC imprests and salary advances and b) payables that include deposits and retentions. The financial statements comply with and confori to the form of presentation prescribed by the PSASB. The accounting policies adopted have been consistently applied to all the years presented. 7.7.2 Reporting entity The financial statements are for the Project Green Growth & Employment Thematic Program (GGEP) 2016 - 2020 Greening Kenya's Development Pathway (GKDP) under National Government of Kenya. The financial statements encompass the reporting entity as specified in the relevant legislation PFM Act 2012 . 7.7,3 Reporting currency The financial statements are presented in Kenya Shillings (KShs), which is the timctional and reporting currency of the Project and all values are rounded to the nearest Kenya Shilling. 7.2 Significant Accounting Policies a)Recognition of receipts The Project recognises all receipts from the various sources when the event occurs and the related cash has actually been received by the Government. External Assistance External assistance is received through grants and loans from multilateral and bilateral development partners 5 Kenya IDF StrengthgenII the Use of Country Safeguard Systerns Project Reports and Financial Statements For the financial year ended June 2017 SIGNIFICANT ACCOUNTING POLICIES (Continued) Donations and -rants Grants and donations shall be recognized in the books of accounts when cash is received. Cash is considered as received when a payment advice is received by the recipient entity or by the beneficiary. In case of grant/donation in kind, such grants are recorded upon receipt of the grant item and upon determination of the value. The date of the transaction is the value date indicated on the payment advice. Undrawn external assistance These are loans and grants at reporting date as specified in a binding agreement and relate to fluiding for the Project currently tinder development where conditions have been satisfied or their ongoing satisfaction is highly likely and the project is anticipated to continue to completion. An analysis of the Project's undrawn external assistance is shown in the funding suninary b) Recognition of payments The Project recognises all payments when the event occurs and the related cash has actually been paid out by the Project. * Compensation of employees Salaries and Wages, Allowances, Statutory Contribution for employees are recognized in the period when the compensation is paid. * Use of goods and services Goods and services are recognized as payments in the period when the goods/services are consumed and paid for. If not paid for during the period where goods/services are constimed, they shall be disclosed as pending bills, 6 Kenya IDFStrengthening the Use of Country Safeguards S1cstems Project Reports and Financial Statements For the financiaf year en(ded June 2017 SIGNIFICANT ACCOUNTING POLICIES (Continued) c) Cash and cash equivalents Cash and cash equivalents comprise cash on hand and cash at bank- short-term deposits on call and highly liquid investments with an original maturity of three months or less, which are readily convertible to known amounts of cash and arc subject to insignificant risk of changes in value. Bank account balances include amounts held at the Central Bank of Kenya and at various commercial banks at the end of the financial year. For the purposes of these financial staterens, cash and cash equivalents also include short term cash imprests and advances to authorised public officers and/or institutions which were not surrendered or accounted for at the end of the financial year. d) Accounts receivable For the purposes of these financial statements, imprests and advances to authorised public officers and/or institutions which were not surrendered or accoumied for at the end of the Fimancia' year is treated as receivables. This is in recognition of the government practice where the imprest payments are recognized as payments when fully accounted for by the imprest or AIE holders. This is an enhancement to the cash accounting policy. Other accounts receivables are disclosed in the financial statements. e) Pending bills Pending bills consist of unpaid liabilities at the end of the financial year arising from contracted goods or services during the year or in past years. As pending bills do not involve the payment of cash in the reporting period, they recorded as 'memorandum' or 'off- balance' items to provide a sense of the overall net cash position of the Project at the end of the year. When the pending bills are finally settled, such payrments are included in the statement of receipts and payments in the year in which the paymems are made. f) Budget The budget is developed on a comparable accounting basis (cash basis), the same accounts classification basis (except for accounts receivable - outsianding imiprest and clearance accounts and accounts payable - deposits, which are accounted for on an acrLal basis), and for the same period as the financial statements. The Project's budget was approved as required by Law and National Treasury Regulations, as well as by the participating development partners, as detailed in the Government of Kenya Budget Printed Estimates for the year. The Development Projects are budgeted for under the MDAs but receive budgeted fUnds as transfers and account for them separately. These transfers are recognised as inter- entity transfers and are eliminated upon consolidatin 7 Kenya IDFStrengthening ithe Use of Countiy Safeguards Systems Project Reports and Financial Statements For the financial pear ended Jane 30, 2017 SIGNIFICANT ACCOUNTING POLICIES (Continued) A high-level assessment of the Project's actual performance against the comparable budget for the financial year/period under review has been included in an annex to these financial statements. g) Comparative figures These are the first set of Financial Statements for the Project and therefore there are no comparative figures for the previous year. h) Errors Material prior period errors shall be correctcd retrospectively in the first set of financial statements authorized for issue after their discovery by: i. Restating the comparative amounts for prior period(s) presented in which the error occurred; or ii. If the error occurred beforc the earliest prior period presented. restating the opening balances of assets, liabilities and net assets/equity for the earliest prior period presented. 8 Kenya IDF St/regthening tie Use of Co untly Safeguards Systems Prgject Reports and Financial Statements For the,financial yetr ended June J30, 2017 7.3 PROCEEDS FROM DOMESTIC AND FOREIGN GRANTS During the 12 months to 30 June 2017 we received grants from donors as detailed in the table below: ~y-, WE .Y. F . .%. . . .;. . Cirants Reccived from Donors (Iiiteraitiinal Orgtizttions) International Bank for Reconstructio n and 13/09/2016 242084 _ 4402,70 2 402070 Development (World Bank) Total 242,084- 24,402,070 24,402,070 - . The direct payment grants represent payments for goods and services done directly by the donor on behalf of the project. ProjeCts sh1ould ensure that the adequate documents mid support document is requested from the donors to support this grant. 7.4 PURCIIASE OF GOODS AND SERVICES 2017/16 Cumulative Kshs Kshis Aquaclean Services 24,402,070 2440 070 Direct payment made by the World Bank through Treasurv to the project consultant on 13"' Scptember. Kenya IDF Strengthening the Use of Country Safeguards Systems Project Reports and Financial Statements For ihefinancial year ended June 30, 2017 NOTES TO TH- FINANCIAL STATEMENTS (Continued) 7.5 CASH AND CASH EQUIVALENTS C/FWD The project is solelv financed through reimbursement and direct payment. Only one direet paymnent of Kshs 24,402,070 was made throughout the life ofr the proicet and therefore the projeet did not have an active bank account. 10 . \ i j i i _ , : � / а) л¢ � > � Qi �1 _ � � l `' i... / � ��' � ��j- N г'� % /-. .Li , - .с О -� �� ' � 4, �` "` �. / и � д � � .--� _ у w w , � 7 ...� � � � � � G С е� �\ � _ � а � , - С U •й � `v' -б U уЛ �i � J � г.,� Ш V О �. � �о• � � J � � � � �� � � д � �-, д � г _ � N � � ¢ � ��_-_�1 ° °м �` � ��� � � _ � у " � � . �^у, у . � ,..г, . С-'. �" ... �i7 ✓ • . � b�� � О � � � �, �...] " �� � � "б 1 � 'ьСв Ci � пi I r � V у " *.. Oq � ^1 �' р � 1 � J ,� С �. z � ...� � �� i .� � G '� .��'., �� ' �+ � . �, ` �� О � � : ; ;, � .� о' :л 3 ; ... � и ог у � � � � 4 и у � .о •С � С � � Q, � о = у С � ~ � � � ��� :� :-� д '� . ао ―괍··