"OD BURTGEL AUDIT" LLC INDEPENDENT AUDITOR'S REPORT l SMART GOVERNMENT PROJECT CREDIT N5483-MN Audited financial statements as at 31 December 2017 Ulaanbaatar city AUDIT, ASSURANCE, ACCOUNTING, ADVISORY INDEPENDENT AUDITOR'S REPORT TO: NURGUL.CI1, PIU COORDINATOR OF SMART GOVERNMENT PROJECT N/We hIae auditecd tlie Financial Statements comprising the Balance Sheet. the Statement ol ProIect Sources and Uses of Funds. the Statement of lExpenditures. the lDesignated Account Statement and the Disbursenient Report of' SMART Goveriment Project lunded by the International Dev elopment Association (Credit No: 5483-MN) and the Government of Mongolia lI>r the y ear ended December 31. 201 7. l ihe project management is responsible fi>r the preparation and presentation ot the Financial Statements in accordance niti the requiremenits o the International Public Sector Accounting Standards. the IDA Financing AgreemenL the Project implementation manual and otlici relevan instructions and procedures. Shese responsibilities include responsibility `or the establishment. implementation anld application o internal controls relating to (lie preparation and presentation of' the Financial Statements without material misstatement's that may arise I-on firatid and error. We are responsible foir making a conelusion on the Financial Statements based on our audit n\ork. We conducted our audit in accordance with the International Standards on Auliting issued by the International Auditing and Assurance Standards ßoard of' the International F1ederation of Accountants. These standards require that we plan and perflorm tile audit to obtaiii icaisoitble assurance about vhether the Financial Statements are i-ee from material iisstatemenlt. An audit includes examining on test basis evidence supporting the amountis and disclosures in the Financial Statements. An audit also includes assessing the accounting principics used and signi icant estimates made by managenent as well as evaluating tile oN erall stateiient presentation. We believe our audit procedures provide a reasonable basis and evidences lor our opinion. l li e nmanagement policy of SMA V Goviernment proiect is to prepare the Financial Statements on the cash receipts and payments basis in conlormity with the International Public Sector \ecounting Standards (IIPSAS). On this basis. cash receipts are recognized when reccived and cash cxpcldi tures are recognized when paid ratlier than w ben incurred. Audfitor's opinlion In our opinion. tie Financial Slatemenis of Ilie SMAR 1 (io\ernment projcct as at December 31. 2017. haN e been accurately and objectively diselosed in accordance n it ilie requi relents f (he Interiational Public Seetor Accouiting Standards issued by the Public Sector Commiittee of the I ederation ol Accounianits. the Financing Agreement (IA1),\ Credit 5483-MN). (lic pioeci implementation maniual and other relevant guilelines and procedures. GENERAL DIRIFCTOR YUNAA.U Date: SM ART Govenunent lnject WALANCE Si 1EET For tie yar en ided Deecember31,2017 (in USD) IENe Cu live to Cumltive to i MS Note )ee 31, 2017 )ec 31, 2016 ASS IS Cash and ens i equivamle nm: 866,878.51 810,813.17 Cash on hand 4 - 1.60 Cash at bank lOperting account 4 14.907.43 2.429.29 Designated account 851.971.08 808,382.28 Ciimulai e piloject expenditties: 2,550,779.11 766,080.75 Goods 864.034.52 22.36 1.30 Non consultiant services 371.754.55 371.754.55 Consultant services 870.358.10 2 19.200.89 raining and Workshops 424.662.90 136.794.52 Operating costs 19.969.04 15.966.19 1OTAL ASSETS 3,417,657.62 1,576,893.92 SOURCES IDA I und 3.359.413.06 1.545.997.50 Ofl1er sources 4 58.244.56 30.896.12 IUTAL SOURCES OF FUNDS 3,417,657.62 1,576,893.92 Preplared by Approved by: yun-N i nW.YoN .C 1 inacial MIniageieiit Specialist Prolject Coordinator 1) HUItTGEL AUDIT" LLC I AUDIT, ASSURANCE, ACCOUNTING, ADVISORY INDEPENDENT AUDITOR'S REPORT TO: NURGUL.CH-, IIU COORDINATOR OF SMART GOVERNMENT PROJECT We have audited the accompanying Statement of Project Sources and Uses of Funds of SISMART Government project funded by the International Development Association (Credit No: 5483-MN) and the Government of Mongolia for the year ended December 31. 2017. the project management is responsible for the preparation and presentation of the Statement ol Project Sources and Uses of Funds in accordance with the requirements of the IDA Financing Agreement. the Project implementation manual and other relevant guidelines and proceduLIres. I hese responsibilities include responsibility for the establishment. implementation. and application of internal controls relating to the preparation and presentation of the Statement of Project Sources and Uses of Funds without material misstatements that may arise 1rom fraud and error. We are responsible for making a conclusion on the Statement of Project Sources and Uses of Iunds based Onl our audit work. We conducted our audit in accordance vith International Standards on Auditing issued by the International Auditing and Assurance Standards Board of the International Federation of Accountants. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the Statement of Projct Sources and t ses of Fund is free from material misstatement. An audit includes examining on test basis. c0 idence supporting the amounts and disclosures in the Statement of Project Sources and Uses of Funds. We believe our audit proceiures provide a reasonable basis and evidences 11 our opilliol. Auditor's opinion In our opinion, the Statement of' Project Sources and Uses of Funds of SMARTI' Government project as at December 31. 2017 has been accurately and objectively disclosed in accordance with the requirements of the Financing Agreement (IDA Credit 5483-MN). the project imiplementation manual and other relevant guidelines and proceduires. GENEIRAL DIRmCTOR JYUNAA.U I Date: joij *M,46 The Govenmient ol Mongolia The interatimal I)eveloiiiimet Associationi Credit JN5483-M N SMAR'T Gov.eninent P>m.icct STATEM ENT 01F PRO.ICT SOURCES ANI) USES OF FUNDS 2017/01/01-2017/12/31 (inl USD) l Cunmlative to For 2017 Cum1ulative to Dec 31, 2017 Dec 31, 2016 SOURCES IDA Funds 3.359.413.06 1.813.415.56 1.545.997.50 Other sources 58.244.56 27.348.14 30.896.42 TOTAL SOURCES OF FUNDS 3,417,657.62 1,840,763.70 1,576,893.92 USES OF FUN DS: 2,550,779.11 1,784,698.36 766,080.75 Goods 864.034.52 841.670.22 22.364.30 Non consulkant services 371.754.55 - 371.751.55 Consultant services 870.358.10 65 1. 157.21 21 9.200.89 I raining and Workshops 424.662.90 287.868.38 I 36.794.52 Operating costs 19.969.04 4.002.55 15.966.49 TOTAL USES OF FUN DS 2,550,779.11 1,784,698.36 766,080.75 Surplus of reeipts over expxinditure: 866,878.51 56,065.34 810,813.17 Cash on hand - ([.60) 1.60 Cash at bank Operating accoulnt 14.907.43 12.478.14 2.29.29 Dcsignated account 851.97 I.08 43.588.80 808.382.28 Balance ofcash and csh equivalents 866,878.51 56,065.34 810,813.17 Prepared by: Approved b): y tun-1 .rdenec.Yo NurgŽuIl.Ch l. inancial Management Specialist Project Coordinator .101) IURTGEL AUDIT" LLC fll OADIT, ASSUR1NCE, ACCOBNIUR GG,ELD INDEPENIENT AUDITOIR'S REPORT O: NURCUL.CII, IU COORDINATOR OF SMART GOVERNMENT PROJECT We hm e audited the aiccompainy ing Statement ofExpenditures of SMART GoNernment project lunded by Ilie international Development Association (Credit No: 5483-MN) and the Go ernment of Mongolia for tlie year ended Deceimiber 31. 2017. [le project management is responsible fr Ilie preparation and presentation of Ilie Statenient olf l,xpenditures in accordance with Ilie requirements of tlie IDA Financing Agreement. tlie Projeet implementation manual and other relevant guidlelines and procedures. l hese responsibiliiies inelude responsibility for Ilie establishmenti. implementation. and application ol internal controls relating to the preparation and presentation of tlie Stateienit of 1:xpenditures witliotit material misstatement that may arise firom fraud and error. We are responsible tor making a conclusion on Ilie Statement of' Expenditures based on our audit work. We conducted our audit in accordance with the International Standards on Auditing i¾stued by the International Auditing and Assurance Standards Board of* Ilie International Ifederation of' Accoutntants. Vlhese standards require that we plan and perlorm Ilie audit to obtain reasonable assurance about vhetler the Statement of EZxpenditures is free from material muisstateiientE An audit includes exanining on test basis evidence supporting the aloulLtsll and diclosures in the Statement of Expenditres. We believýe our audit procedures provide a reasonable basis and evideices for our opinion. Audilor's opillniu In our opinion. Ilie Stateient of E:xpenditures oiSMAIRT Government projeet as at December .31. 201 7 has been accurately and objectively disclosed in accordance witih Ihe requireients of Ilie Viinancing Agreement (IDA Credit 5483-MN). project implementation manual and other relevunt guidelines and proecdures. GENERAL DIRECTOR OYUNAA.U Date: dält --o6 Te Go e iament of NI ongoli Thke lintenuil.et e)Nlopmlent Association CrediI .N!5483-M N SNI ARG G enicume l'rject STArTEM INTOF EXPEN DITURiVS (IDA Wiuiramils) 2017/101/01-2017/12/31 Aljplicti Claimedl Creditei dale Aimmmimt claimed Mommileree Numbers ty e d11.1 eredlitel l p in D e b31,2(16 (WA (11-14) 1,742,7.8.55 1,545,997.50 196,791.05 W. V051 Replkiiisimieii 1 i 2<01 7 5 15 2017 27 3.100.79 272.100.79 - WA-06 Repleiiisiuiuutl 5 2120 17 5 2 1 20 17 '98.909.07 298.909.07 WA-07 RepIleiinishIeIti 9'6/2017 9 25 2017 270,119..17 270.119.47 WA-08 IReplleishnliuut 10/2/2017 10 18 20 17 37 1.035.5 1 374.035.54 WA-09 Repleishment l, '3/2017 l l 92017 72.8 6.25 272.846.25 WA-1 ) Replenisiiietil 12/8/2017 12 22 207 325. 1 ,4 325 LO . II [o, Ilie irpomling period 21117 (WA 05-10) 1,813,415.56 1,813, 415.56 - IL 1 r o Ieecumlber 31, 217 (WA (1l - l 0) 3,556,2114.11 3,359,413.06 196,791.05 1. l1e expeiditure o [US) 220.083.25 e \peiised in 201(6. \sas ei imid ndit l cred iled ltouh W A-05 in 2017. iMA-05 expenses i nirred bel ween '2I 01 0 1 and l'01 1 om uniiling US) 52.017 5,1 as in lided. Prepared hy Appro\ed hy Oyunl-Erdenle.YoN .C i inancial Managemjent Specialist Projecl Coordintor 1)11 Bl It T IL ALI)I " LL( � � _ ;, � е= � г г � � е � � � [� 1 Т �П -Г `. . n � Т �Г, г'] Т 1Г. :3 г� Т _ ..'�. :G Т "Г Г 1 7_С ^Т Г1 �П М_ � � r ^ п 'у 4 'r . .. � t� 1' [� 1� Г` 1 ... � r! г'1 Г1 Г1 г�, 7С �� С1г 'уз у 1 'л У г�, r = .✓ г•i г�, f� Т L °r Т V: Г1 :С .�.G' Г'1 1 с � х•-- rn т v.. � � .J Г1 Г1 Г1 � �� гуь � r 1 п -� аС � - � т �гi 1� ' �л х С!1 � 1л Т V' f� � . � ,� v У �. гл �. � rt г.� гП Г1 Т У ^'S [�.. � �:. �:: ^t �л �t � = - в -1 _ � � М � r= fr Т R Т г� 1� h `.А J �' '1 ..'F I Г•1 �f.' �.�. 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'� - С .J �. i� С С С � ? , С^ � � � ё � � _' � :г Л С3 ' # � � � i S � � ^ � � � .. ..... ��. � � � г г � � AUDIT, ASSURANCE, ÅCCOUNTINGý ÅDNISORY INDEPENDENT AUDIT0IVS REPORT 1'0: NURGUL.CI1, 1111U COORDINATOR OF SMART GOVERNMENT PROJECT Wc liaN,eiticlited (lic accompanying Designated Account SWIcillent of'SMAR LGoverninent pro , ect flunded by flic International Developnient Association (Credit No: 5483-MN) and Ilie Go\ eninient ol'Moilgolia fior flic year endcd December 31. 2017. Hie pro * cet management is responsible ffir die preparation and presentation ohlic Designaled .Äccoijnt Statenicilt inaccorclancc xvitli tlic requirenicilts of'tlic IDA Vinuncing Agrecilient. ffic Pioject iniplementation manual and otlier relevant guiticlincs and proecdures. I liesc responsibilitics include responsibility flor (lic estiblisliiiieiii. iiiililcilieritLitioji. and application of' inm-nal controls relating to tile preparation and presentation ol'tlie I)esigiiiteel Account SLItement wit]IOLI( Matet-ial illisstatcillent tjiat mayarise fi-om 11i-auel and error. Wc are responsiblc ffir making a conclusion on (lic Designated Account Statenient based oli om- audit Nvork, Wc conducted our audit in accordance witli (lic International Standards on Auditing issued by [lic International Auditing and Assunincc Standards Board of' die Iii(ei,ji,,ttioiial Federation ol'Accounuints.These standards require that wc plan atiel perftm-in 111C audit to olitaiii reasonable assuruncc about svlietlici- die Designatcit Account Statenient is fi-ec 1,1-om illaterial misstatenlents. An audit includes examining on test basis. evidence supporling eliselosiii-cs in tlic Designatcil Account Statement. VVe helieve our audit procedures pro\ ide a reasonable basisand cvidences ffir our opinion. opiffion Iii our opinion. the Dcsignated Account Statenient of'ffic SMART Governnient I)týo,iect as at December 31. 2017 lias becil accurately ancl obJeetively cliselosed in accordancc kvitli (lic i-elltiii-etileiits ol, tbc Filialleing Agreenient (IDA Credit 54834VIN), ProJect implenientation manual and ollici- relevant guidelines und procedures. G EN 12RA L D I R EC 1'0 R YUNAAM Dale: lie Go c ninie net) [fI ougolia The Igernlational leeloleiii Associntion Cr dil J1,5483 M N Snat «novennent Project 1) SIIGN ATl) ACCOUNT STATI31 EN T For tlie ycar ended I)ecemiiie r31, 2017 ii S Itens At Dec 31, 2017 A Dec 31, 21116 Pn1il A- Account tmusactions leginning Imlaice 810.813. 17 Add: l otal miounlt deposited by Ilie I DA lor the year 1.813. I 15.56 1.5 15.997.50 i otal interest Camed 27.089.26 35.582.38 1 ol cig exclumge gain (loss) 258.88 (1.685.96) J otal 1.8 10.763.70 1.576.893.91 l1 oal amount u ithdraiwn 1.784.698.36 766.080.75 nding ilance 866,878.51 810,813.17 1Part Bl - Account reconeiliation AXmuoiiil .advanced by- the IDA 1.000.000.00 llblaice of tie )esigiiatd accoiml :m1 Ilie end of the yea 866.878.51 810.813.17 Add: Amouni witlidrai and not yel elaied 191.366.05 220.083.25 Nel inleresi carned 62.671.34 35.582.38 1 oleigin eschange gain ([oss) (4. 126.78) (4.685.96) [otal 58.24 1.56 30.896.12 iI aladvlicn to l)esignated ac tit 1, ,000.0) 1o,n00o,mw.( Prepr : Appmoved b): 1 un- 1 rdnice.Yo Nu tc i 1 iiiancial Nanaligciieii Specialist Project Coolrdinatilor o IR l l 1(11l 1 AUDI)"1 LLC 1D � � � �w��� :�..... ����.м.....п.� х � Ф� � � _�.�w�4 �...���, �....�п.��п � � � � � � � � _ � � �• L � € � ,� s . � � �, � rv � �� � " � F � �� •J � �� rr. � n � z ._ . � � � � � � � 1 � �' � � �. , . 1� � � ° # � � . й �� � � � � � � �У 8 С : �_? � . - � 7 n � - с $ у 3 � # � � � � o- � � '<, , � ............... � , � тт.тт�� £ � £ . #..�.�«.�4..:,.. i •� й •j G .<,..«�. .w. � .. 71 � � .� ....� : ° €.т..�...т � o- л • r � � г' � � -� � � � � и� � �_ � � ' •; �' v � � с� е � � _ � � � 7' ` �' � � ,� � 3 м ;� � � '�_ � : р ..! `„ .. �` _ �ч V - : � й � G . �/'J' _ С 4 Бд � � й . ` 9 м L - fJ " ° ы ; � Sf i, : iы � L.� ,�. - �G ь. / �i � G � �у " ioJ .. � . £. . # Г .....��.,.....£ Г А #..�,�,.+'. , � �! i i i __ � � � 1 �I 1 - , � I I .,_ - � i' , ` �� i i I � Н III ы � и и И И - М н н � �' ,� � ! r У. . С ,,,, ,,,, } � г � _. ..... ... гi Т J � - - � � . р . ,, ... .... ` ,,. ,', ., ,, ,,,, К Х,,,,. ,,,, ,,,, ,,,, у � ,,.. ,,, , ', ',. pi � ',. ,,, , ,,, ,,.. ц. У � ` 1 i _ _ �_ С,. _ 3 ,,,,. � � С ,,,. _ _ _ _ ,,, - � С ,,,. � . . . S ',, _ _ _ _ ; о ,. ,,, а _ е у ,,. Г i У iГj ,,,,, `. ,,,,, ^ � � �! ,,,,. . , .. гГ ', ', � 3',. ',, ',, О',,. , ,,,, ,,,,. � iГi ,',. - � ,... ,... ,.. .. с ......... ......... ......... �......... � . . _. � � "-? _з �1 � , � .. I ........ .. ._. ы `r �� ,� . ......... . . . п . - - " [-' � м -,�' . . ,т, .�.. .� W � Е-� _ � �л _. г, . � ,.. �+ '' ' ' � �� - - - ---- --- - ---- - 〔 ！一，l 粹！! &!& 。。。‘一一一I一！ l一：:！、 !!！邑 l膩 l中 蠱 O 鑲屆 夕叮 一，l __l__l__l_l’遛 一！、1一l一＿&&!!／二 ；一〕；; && 每 t mher 31. 2 NoTFSTOT11F FINANCIALSTATEMEWIIS 1. Projeet hackground 0n Junc 18. 2015. (lic International Developnien( Association and Ilie Cjoxeriiiiient of' Niongolia (represented by Ilie Ministry ol' Finance) signed Ilie Financing Agrecincilt Credit No:5483-NIN to assist in linancing SMART (Box-ci-iiiiieiit Pro ' jcct.The Cretlit Aillounted to SDK 12.600.000 (ctliii\--aletit to original appro\ed aniount ol' US$19.400.000) änd (lic Iinaricing Ligrecilicilt Nvas declared as el'I'ective on September 17. 2015.111c closing elate o1111c proJect is December 31. 2020. l lic developillellt ot).iectis,e ol, Ilie lil.o.jcct is to Lise illik)I.illttioll and collillitillication teclinologics tt) iniprox-c accessibility. transparenev and c11iciency o1 public sen-iccs iii N-longolia. l lic ProJect Colisisi.S 01,tile 1-()llolvillg parts: 1. Ellhance Civic I"ýllg.igelilellt.-1N]tl Citizell Feedback medialfisens 1'-NI)Zll]Sioll alld illli)Uoý,ctlieiit ol'(lic lkcipienCs citiien call centers in order to cilable citilens (o collaborate Nvith govermlicilt in policy and sers icc design and to tilake public sector data Illotc M idely a-vailable tt) Ilie public inclutling: (a) integratioll o1 Ilie lzeeillicill«s central call ceiitci- måtli (ile call Centci- SYSICI11 ol, Ulaanbaatar city to inerease efficielicy alld redlice citizcll Colli'LI%ioll: atid (b) developnient. of' a busincss alialyfics prograill aillled at illiprovilig alld olitililililig policy alld program decisionsand illli)lclllelltltio11. Component 2. Enahling Foundations for SMART Governinellt I -,ý(abl islunent oIshared open dma in I'i-zistt-ttettii-e and serviccs (]lat can be used by. afl agelleics and offlies to Ilie Recipiellt to illiprosc selwice delivery including: (a) design. dexclopillcilt. (leployllient. ancl use oItlic ilational enterprisc zit-cliitectiiie and iiitci-t)lici--,ibility as a business process rcengincering tool and Ilie techtfical basis 1'or (lic Rceipient. to link independently developed proccsses alld itilol-iiiiiit)ll Systellis to enhancc its ability to use ICT to oll`er scalilless onlille services lo citilens alld blisiticsses: (b) upgrading ohlic National Data Centerand (ransifioning it into a national data exchange and clolid coliljulting (c) cs(ablishilient ol'an innovation support progra`iii all(] provision ol'ijitlovitioil grallts (o lillancc citi7cll el-catc(1 sitiljlic open elata and mobile applications in support oCspeci (le goveninient ob cctives in priority sectors. as a nicebanisni to quickly ittelltil'v. test. und deploy suell applicatiolis. (LI) scaling 111) 01 t11C digitiMtion o1 property registration inclutling expansion o]' Ilie e- property registratioll systeill currciffly being iniplemented in Ilie 5 distric(s o1 Haanhaatar and 8 otlici- Ainlags. (o Ilie remaining Aimags: and (e) provision ol,teclillicýll assistancc to (lic Cabine( Secretariat and 1'111 l A to cilliallec (licir capacity to deliver 011 Moligolia,s SMART Governillent Program. 1101) BURTU. 1, AUIET11 LLC 14)mponent 3. Enabling open data (a) Design and implementation of an open data iniiative in order to create a dynaimiie. sustainable system. ilncludinig: m. carrying out an open data readiness atssessument in order to identify the high- inpact entry points 1or initial investments in open data. both on the Supply and denand sides. and deselopnient of a tar-geted. elient-specilie open data action plan; ii. carry ing out a revie\ of the policy. legal and institutional lraiework lor open data. in order to (A) ensure that it sernes the needs of the Recipient and its citiziens: and (13) strengihen the institutional structures critical tor the management and coordination of open data: iii. supply of data sets in priority initiatis es of the govermlient: and iv. promotion o ldemnaind-driiven reuse and co-cieation ol open data including actiN e engagement vith data suppliers and users. provision of training to government oflicials. citizens and businesses and carry ing out a campaign of awareness- raising. (b) Enhancing the data production capabilities of the National statistics Office. ineluding development or redesign of its data production inIaistructure to improve internal data management and compilyi witi standards and requirements of the national enterprise architecture. ('omtilpmtent 4. Piroject Imapliemenlation Suppor Su1pport to projeCt i1mplementation. ineluding estabiisliient of a project iiplenmentation tillit. Ilie 1l,loNing organizations will be required to i mplemiient the prioieet as described in ilie ii mplementation guide. l. Cabinet offlice of ilie Goxernment of Mongolia / project componenit l.a. 1b. 2.a. 2.e and 3.a! 2. National Statistical Oflice proicet component 2.d and 3.b 1 3. Communications and Iechnology Autlority / project component 2.b / 4. General Authority for Intelleclal Property and State Registration / proect coiiponent 2.d and 3.b "01) BUIRTGEL AUDMT" LLC Ilie aiount of the IDA Creidit re-allocated has been compaired vith the actual disbursemenits as oi December 31. 2017. Anni omlr t AoeFuaf iisemteme Cnilegory lallocaled (expresseI lIIente in i SD I)R* Goods. Cosu ltnt scrIt Ices. 1 raining and morkslops an1d 12.200.000.00 100"q% 2.550.779.1 l 1.791.111.95 opernling Cosis 2 1 und 0il ilni atioi * 0.(KL00 1IMU1i 1 2,60,~ 6il) l 00,% 2,55(5,779.11 1,791,113.95 I ctuaf dimvmn in ( 'NI) as of' Peem ber 3 1. ? - luis been ilislatel in? Si)Ri at t h clwge tl ite. t \DI? 1.-4 ?4/ 30 1 S/) 1as nf /Jeember 29. 201 ul at hilp-v v i i m r. In the fIrnievork of' the lFinancing Agreement flor SMAR 1Gos eminent Projeet. l be IProject Implementation Unit (PIU) has been established to conduct the overili CoOrdination and management o[ proiect implementation. Ihe Project Coordinator will tead (le PSC. stafed with the following consultaits: tinancial managempnt specialisi. procurement iiplementltioni specialist. translators. at coiunitiiication1s specialist and nionitoring and evaluation specialist All staffs are qualil[ed and e\perienced. Ilie Project Steering Committee vas established by Ilie order Nk180 in 2015 of' the Cabinet Secretariat. lie Project Steering Committee. led by the Secretariat. consists ol the [lloxs ing members: • Cihairman o the National Statistical Office • l lead of Inlormation 1Technology Department. Cabinet Secretariat • t kad of niinance. linestment and Services Department. Cabiiet Secretariat • l lead oli Commuinications and Inoirmation TVechnology Authority S1 lead of Development 1 inance Department. linistry oi Finane • l [ead ol Administration Department. General Authority for Intellectual Property and State Registation Ilie Project Steering Committee Vill need to provide policy guidance and to ensure inter- ýectoral coordination and elficient pr[oiect activities. mid-term plans for he project detailed plans lor the particular year. procurement and financial plans based on them. the iiplementation o the p]l and its monitoring reports on a semi-annual basis. to re iew tlie projeet's annual progress report on tiie lirst quarter of the next year. and to ensure that Ilie pioiet imnplementing agencies and tPSCs have the authority to ionitor tleir implementation. 2. Sunimmary o significant accouning policies a1) Skatenent of compliance lIhe inancial Statements coniprise Ilie Balance Sheet the Statement of' tProject Sourees and 'ses oi' t unds. the Statement of' Expenditures. Designated Account Statement and the DisbursemenitReport. i hese reports have been prepared as agreed with the World Bank. "(I>) lURTGE L A UI)1" LLC b) Basis of preparation Ilie 1 inancial Statements are prepared in accordanec with Ilie International Public Sector \ccouiiting Staindards (IIPSASs) issued by Ilie Intenational 1 ederation of Accountatis. Casli basis ol acounting has been adopted. On this basis. receipts are recogniied sxhen receiNed or tlirecti pmeiii te creditors are made ratiher than whein income is carned and disbuijsenmenits are recogiiiied vlen paid rather ihan when expenses are incurred. Ilie Projeit has own P>roject limplemeiaiion Manual m hich has been accepted by Ilie World 1lmk and its financial management sy stem is bei ofl.perated consistenily in accordance w ii this financial managenient nianuail. Ilie Projeci utilizes finanicial solin are named info S) stenis". which is designed lor accounting ol project activities. c) Basis of ineasurement Ilie Financial Statements are presented in US Dollars (".SD"). E-xpeiditiiie transactions denominated in currenlcies other than USD are translated at rates of Ilie respectixe Fund transaction from Designated Account to Operating Accounts. Any gains and losses are refleted in the Statement of Sources and Uses of lunds. d) Basis ol' presentaition Ilie accoult balalnces in Ilie V inancial Statemenits as of December 3 1. 2017 ha\ e been compared with such balances as ol December 31. 2016. e) D>esignitei account Iii accordance with the iDisbursenent -etter dated .lune 18. 2015. the proiect opened ilie Designated Account (DA) wti ich is one segregated account for Ilie credit linancing tiacceplable to the World Bank. The ceiling of ltie designated account is USD 1.000.000 (one million I SD). Account number of the DA is 106000035388 and it is maintained in USI) at the State 1lank. The payimenlts for the eligible expenditures o[ procuring goods and international consultant sern ices are paid fi-om the Designated Account. 1) Operating account \s specilied in the Disbursenient Letter. Ihe project opened Ilie Operating Account (OA) w iich is one segregated account for the credit Iinancing acceptable to the World Bank. I lie ceiling o hlie designated account is USD 30.000 (thirty thousand USD). Account number o hlie OA is 106000035391 and it is maintained in MN l at the Siate Balnk]. I lie pay ments ['or the expenditures oftraining. ineremental operatinig cosos and local consultani services have been paid Ironi the Operating account. I lie Minister of Finance has enucted Ilie decision #357 ol December Il. 2017. which delines al[ tlie designated and operating accounts maintained inI MN 1 of ltie Government projects and activities inanced by foreign eredits and grants sliall be transferred to State reasury Accounts operated by M inistry of Finance. In accordancec witi Ilie decision #357 of tlie Minister of i inanjce. ilie Project had traunsferred its OBAs into State I reasury \ccounts. Ilie accounts held "1>D URTGEL AUDIT" LLC at commercial banks sial l be closed and accounits held at State l reasury shal l be used in f[liher transactions. 3. Dishursement progress a) Disbursemt of IDA Credit 5483-MN As of December 31. 2017. the project had receii ed $3.359.413.06 (17.32" of the total credit) through the DA as financing from IDA Credit 5483-MN and had disbursed $2.550.779.11 (13.15% of the total credit). 4. l tems in Ilie balance sliet 4.%a Cash and cash equivalents Summary of transaction statemenis of Operating Bank Accounts and Petty Cash Accounts fr Ilie period betÅseen December 3 1. 2016 and December 31. 2017 are indicated as Iollons: 4.1.1 Operaiing Bank Acco unti i I)A Credit 5483-MIN (in USD) erms At Dec 31, 2017 A Dec 31, 2016 Beginning balance 2,429.29 \dd: 1 rom IDA Designated account 123.664.23 136.0985I [otal interest Carned 360.05 109.19 1 oreign exchange gain (loss) 277.12 (4.685.96) Net tender material sale revenue - Total 124,301.40 131,821.74 Deduct: Cmulative project exipenitires: Goods Consultant services 100.794.47 113.571.39 1 raining and Worlshos - - Operating costs 9.634.13 13.479.15 To1al 110,428.60 127,050.54 Advalice to petty cash 1.394.66 2.341.91 Total amnouit witldnnwn 111,823.26 129,392.45 Vilding Ialamnce 14,907.43 2,429.29 "(>1) BURTGEL AUDIT" LLC 4..a.2 Pefty Cush Account of IDA Credit 5483-IN (iii USD) lins At Dec 31, 2017 At Dec 31, 2016 Ileginning halnince 1.611 \ ckl: 1From IDA O)eraling accotii 1.394.66 2.341.91 Foreign exchange gain (loss) (3.93) Net tender material sale revenue - - 1oal 1,3911.73 2,341.91 Dåduct: Ceumulatiive2 project expentlitures: GooIs - Consultant services 1 raining and Workshops - Operating costs 1.392.33 2.340.31 Total amount wilhdnnn 1,392.33 2,340.31 1 lding alanice 1.60 -1. Other sources I lie balance of other soirces comprises of interest income nand loreign exclange gain (loss). (in USD) Items At Dec 31, 2017 At Dec 31, 2016 Interest income 62.671.34 35.582.38 Foreign exchange gain (loss) (4.426.78) (4.685.96) Total 58,244.56 30,896.42 5. Events after reporting period l Ilow expenditures of USD 191.366.05 liad not been elained to Ilie World Bank by lie year end December 31. 2017. l lovever. it was claimed to the World Bank in March 2018 and replnislied in April 2018. "(>1) BUITCEL AUDIT" LLC Category Anutil in USD Goods I 28.895.97 Non conisiltani ConsultantL services 59.A34.88 -ainiiig id Workshols 1.109.-I3 Operniing costs l 925.77 Totl 191,366.05 6. ProcuireIent cnntrnets I or the reporting period the ProJect had concluded eight procureillelnt contracts inl total tlrotigh i nternational open (ender and single source option. pricc comuparison. based on (le exper's ability selection meliods. Tihree contracts were signed to procure goods and eleven conltracts Nere signed to procure consultanits' services. We have audited three (100"1) goods and eleven (100"') procuremicenlt of 'Constullanit's ser ices p1ocurement contracts. These procurements were conducted in accordance with the Procuriment Guidelines issued by the World Bank. 7. Other matters Within our audit engagenient. xue hae requested the project to proN ide us Legal Representatioin Letter to assess whether tlieie is any unloreseei obligation. entitlement. and litigation issociated wi te projet. l Iowex er. we have not i eceived any I egal Represenitatioin I etter by the date ol Independent Auditor's Report. Consequentlv. we did not exatate thie impact of issues associated vitli an unloweseen obligation. entitlement and litigation on the Vinancial Statements of the proJect. " B lURTGIEL AUDIT" LLC