LIVESTOCK SECTOR DEVELOPMENT PROJECT IDA CREDIT 6110-UZ INDEPENDENT AUDITOR'S REPORT AND SPECIAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 Livestock Sector Development Project n the Republic of Uzbekistan. IDA Credit 6110-UZ Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 CONTENTS INDEPENDENT AUDITOR'S REPORT 2 STATEMENT OF CASH RECEIPTS AND PAYMENTS 6 STATEMENT OF USES OF FUNDS BY COMPONENT AND EXPENDITURE TYPE 7 STATEMENT ON IDA FUNDS, REPLENISHED ON DESIGNATED ACCOUNT 9 STATEMENT OF DESIGNATED ACCOUNT IN USD 10 STATEMENT OF DESIGNATED ACCOUNT IN USD 11 STATEMENT OF CURRENT ACCOUNT IN UZS 12 STATEMENT OF CURRENT ACCOUNT IN UZS 13 STATEMENT OF CURRENT ACCOUNT IN UZS 14 NOTES TO SPECIAL FINANCIAL STATEMENTS 14 1 CREDIT LINE FOR PRIVATE INVESTMENTS 14 2 PROJECT DESCRIPTION 14 3 ACCOUNTING POLICY 15 4 DESIGNATED AND CURRENT ACCOUNTS 17 5 FIXED ASSETS 18 6 LEGAL STATUS, TAXES AND OTHER CHARGES 18 7 RECONCILIATION OF IDA AND IBRD FINANCING 19 O GrantThornton An instinct for growth AO 000 (Grant Thornton Pecny6nlKa Y36eKVCTaH, 100128, TaWKeKr, yn. A6as. 1A Tenr: +998 (71) 230-45-43 OaKc: +998 (71) 244-47-43 INDEPENDENT AUDITOR'S REPORT "Grant Thornton" AO LLC 1A, Abay Str, Tashkent, 100128, To the Management of the Agro industries and Republic of Uzbekistan Food Security Agency Tel.: +998 (71) 230-45-43 Fax: +998 (71) 244-47-43 W: www.grantthomton.uz Opinion We have audited the attached special financial statements (hereinafter referred to as the financial statements) of the Livestock Sector Development Project in the Republic of Uzbekistan) (hereinafter referred to as the Project) financed by the World Bank International Development Association (hereinafter - IDA) Loan No. 61 10-UZ under the Financing Agreement dated 20 September 2017 (hereinafter referred to as the Financing Agreement) and due to the contributions of the Government of the Republic of Uzbekistan for the period from 01 January 2019 to 31 December 2019. The special financial statements include: The financial statements include: The statement of cash receipts and payments, Statement of uses of funds by component and expenditure type, Statement on funds, replenished on designated account, Statement of designated account and Explanatory notes to the special financial statements, including a summary of significant accounting poicies. In our opinion, the accompanying special financial statements reflect fairly, in all material respects, the cash receipts and payments of the Project for the period from 1 January 2019 to 31 December 2019, in accordance with the terms of the Financing Agreement and IPSAS. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the "Auditor's responsibilities for the audit of financial statements" section of our opinion. We are independent of the Project in accordance with the ethical requirements that are relevant to our audit of finan cial s tatements in the Republic of jzbekis tan, and we have fulfilled our oth er ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of the Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with IPSAS: "Financial reporting on the cash basis of accounting" and for such internal contr,pl fit, Mciber of Grant Thornton International T15 .C GrantThornton An instinct for growth' 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 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. Auditor's Responsibilities for the Audit of the Financial Statements Our 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 our opinion. Reasonable confidence is a high level of assurance, but it is not a guarantee that an audit conducted in accordance with International Standards on Auditing vill always detect a material misstatement that exist. Misstatement 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 the financial statements. As part of an audit in accordance with International Standards on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We 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 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, but not for the purpose of expressing an opinion on the effectiveness of the Project's internal control. * 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 Project's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Project to cease to continue as a going concern. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates, if any, and related disclosure made by management; * 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. GrantThornton An instinct for growth We 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 we identify during our audit. Partner: N.F. Karimov Auditor:,, SK Al=alov 13 July 202- Tashkent, UAekiisian Livestock Sector Developre rcec:nn -te Repub[ic of Uzbekistan, IDA Credit 6110-UZ Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless othe.::-- -:- ) 6 STATEMENT OF CASH RECEIPTS AND PAYM1ENTS In US dollars 2019 Cumulative Opening Cash Balances Designated account in USD - UZAIFSA 4 857 071 Current account in UZS - UZAIFSA 6 859 Total Opening Cash Balances 4 863 930 - Receipts Designated Account Replenishment 40453748 104484880 Advance payments - 5000000 Government Co-financing (SSP) 56934 122185 Total receipts 40 510 682 109 607 065 Total Cash Available 45374612 109607065 Payments Credit Line for Private Investments - 22 564 Goods, works, non-consulting services, training and 43451 544 107 076 451 incremental operating costs of the Project Government Co-financing (SSP) 862 519 1 383433 Veterinary Services Improvement 56934 122185 Total payments 44370 996 108604632 Effect of foreign exchange difference (5 067) (3 885) Closing Cash Balances Designated account in USD - UZAIFSA 998 109 998 109 Current account in UZS - UZAIFSA 441 441 Total Closing Cash Balances 998 550 998 550 Signed on behalf of the Project Management on 9 July 2020. Deputy General Direc or Chief Accountant G. Gubieva- VF I n1 n llhlgapr Fa S ��.. ги � � Р'. ь+ � � и � , (f} Г � � и � ,� � CQ �.U � � � L�i ы � �а {L т °� � �' c�D � �°у � и и о �,� е� т � � � а� `"� ьs� °� °а °а о � ? � с� cr о :.. � п�i °о v г � .- � � м � с°�'а г °м � � rn .. � О3 С7 С7 б Ci � т о а ав �° Q � � � °� � � � �t� � � м r- � : �. -;�-,, й � v � � о� � N � ао � С �- � о гл � с ~ �,°,� г•. � оа � � � � W с' о � � с� � � � м w L,, °�' �` а :� � rJ�ы � � °' �rn � V Г и и а � .� � N � � д, о �' �-+ й цт � �_ � ь--� v оэ м `д -�у � � �г � � � �� W � в F� � � � �� � � -� А ° с '� `� � � � ш с ,� � � ° : �с s F, ° �� ' д с � � � � о W � � �' с� � С� � � а U � � � � � � � � � п� � ° g гл r°--• �' © с � ag's � f�U ш `о � ; . гУ � � •с ° � й � `� � ц � .«.. ,� и- � .� � +� `� с ,и; � � , � � v i� � Ё v Ё � ° ° ^ �., гп св -. о `т � ш � �' � � с �а � `�' � �; � ��� � �' �� v � ал � v, � � v � ` � � � а°ч � W ы � � � � �, � _ CJ � � � `3 L • [б У' у . . ар У ..'�._. � �+� ы° � С а ,� V . . G1 .� fl �L �° � �� G" гуа s.� . . С] и7 � Г� � У � р т � �, С�7 .� � � ?д U J � � �' � �1 U � `Z 6i },° +-' t= {� +� N � _ � . . . {1�].. � � � � Q 1? N �р � . 't) �, � . . . �4 � v� а W й С7 J �� t�' © � ri _.,, у. '� � G7 Н Cl7 � � ОД L? Q � � г� ' ЧУ ш у� д � � ro с�в с�в �" �д �" С� : .? i� � F С (} tL д iL S гЛ Q `: � J и '� из Livestock Sector Devetopment ,i the Rep ubfic of Uzbekistan, IDA C red it 6110-UZ Specia I Financia I State merts irocr -,)e cash basis of accounting for the year ended 31 December 2019 (in US dollars- Unless _ -_-- -) 8 STA.TEMENT ON IDA FUNDS, REPLENISHED ON DESIGNATED ACCOUNT WANumber Category of expenditures Total amountto be Amountof designated recovered account replenishment 1-Goods, works, services and other Sub-credits incremental costs of the Project 54 5579 392073 397652 534 906 55 91 577 3613181 3704757 3704757 56 5815 2005475 2011290 2011290 57 22197 3400417 3422614 3422614 58 1 508 999360 1 000868 1 000868 59 24366 882731 907097 907097 60 22362 2873189 2895551 2895551 61 - 819271 819271 819271 62 39107 2869077 2908184 2908184 63 107595 4071 120 4178715 4178715 64 55640 3119812 3175452 3175452 65 110509 4806875 4917384 4917384 66 40678 2015988 2056953 2056953 67 62661 2334451 2397111 2397111 68 27689 2497630 2525319 2525319 69 25025 2973249 2998274 2998274 70 82894 799500 882394 - 71 4131 485000 489131 - Total 726202 40473398 41198887 40463748 Application No. 54 includes expenditures for 2018 and 2019. This table shows only expenditures incurred in 2019, The total amount of the application is 534 906 US dollars. * Applications No. 70 and 71 include expenditures for 2019, however, the apptication to International Development Association for the replenishment of a special account. was submitted in 2020. Sigticd on behalf of the Project Management on 9 July 2020. Dcpufy Gcneral D -c or Chief Accountant G. Gqtliev G. Gubieva 2 NoIrs Ir ig . lni;j 14 o lVar4, im iillegralparl of Livestock Sector Developmnt Prcect in the Republic of Uzbekistan, IDA Credit 6110-UZ Special Financial Statements uncer the cash basis of accounting for the year ended 31 December 2019 (in US dollars, unless other.. s e o-) 9 STATEMENT OF DESIGNATED ACCOUNT IN USD Account No 20210840503965637033 Depositary Bank JSCMB Ipoteka Bank Address Tashkent, Uzbekistan Related Loan IDA 6110-UZ Currency In US Dollars Balance as at 01.01.2019 4 857 071 Receipts Replenishment of funds by IDA 25 558 563 Government Co-Financing (SSF) 56 934 Total cash available 30 472 568 Payments Credit line for private investments 29 860 008 Transfer to current account in UZS - UZAIFSA 336 062 Transfer to current account in UZS - UZAIFSA 197 000 Government Co-Financing (SSP) 56934 Consulting services 22 564 Total payments 30 472 568 Balance as at 31.12.2019 . Signed on bchalf of the Project Management on 9 July 2020. Deputy General Dire to Chief Accountant G GanleV G. Gubieva 'VD/.f lo he' /fill7wtwi/ lalewilsV i //; w, t'i 14 fo/ ar9 nit w/h / a' l /w t lh"e sal"enh Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 611 0-UZ Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless otheAise s:atec) 10 STATEMENT OF DESIGNATED ACCOUNT IN USD Account No 20210840005049362024 Depositary Bank PJSB Ravnaq Bank Address Tashkent, Uzbekistan Related Loan IDA 6110-UZ Currency In US Dollars Balance as at 01.01.2019 - Receipts Replenishment of funds by IDA 14895 185 Transfer from current account in UZS - UZAIFSA 120 822 Refunds of employees payroll 96 523 Transfer of remaining balance resulting from the 17 391 renaming of the organization Total cash available 15 129 921 Payments Credit line for private investments 13 591 536 Transfer to current account in UZS - UZAIFSA 250 143 Consulting services 193 610 Refunds of employees payroll 96 523 Total payments 14 131 812 Balance as at 31.12.2019 998 109 Signed on behalf of the Project Management on 9 july 2020. Deputy General Dir t Chief Accountant G. GQ1lerC. G. Gubieva - i ;ar:usaeni OHi~ UIh$ P 19' w iillnyal par? lbthre sialemewts Livestock Sector Development Prcject IDA Credit 6110-UZ) Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless other,se sz -;: 11 STATEMENT OF CURRENT ACCOUNT IN UZS Account No 20210000903965637039 Depositary Bank JSCMB Ipoteka Bank Address Tashkent Uzbekistan Related Loan IDA 6110-UZ Currency In thousands of UZS In US dollars Balance as at 01.01.2019 57200 6859 Receipts Transfer from designated account in USD - UZAIFSA 1 655 312 197 000 Refunds of employees payroll 4884 582 Total cash available 1717396 204442 Payments Consulting services, goods and works 907 283 108 013 Payroll 529 084 62 838 Transfer of remaining balance resulting from the 146 692 17391 renaming of the organization Operating expenses 65 055 7 737 Bank charges 40752 4853 Petrol expenses and car maintenance 28 530 3 398 Total payments 1 717 396 204 230 Effect of foreign exchange difference (212) Balance as at 31.12.2019 Signed on behalf of the Project Management on 9 July 2020. Deputy General Dire to Chief Accountant G. GaneV G. Gubieva . . ...... Nm'sIn /k'jram i;! c/gyy~t~ ;9§0i Ii n /9 anan l/tn/pcii----------ais Livestock Sector Development Proect in the Republic of Uzbekistan, IDA Credit 6110-UZ Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless ot en s saed) 12 STATEMENT OF CURRENT ACCOUNT IN UZS Account No 20210000905049362028 Depositary Bank PJSB Ravnaq Bank Address Tashkent, Uzbekistan Related Loan IDA 6110-UZ Currency In thousands of UZS In US dollars Balance as at 01.01.2019 - Receipts Transfer from designated account in USD - UZAIFSA 2 300 278 250 143 Refunds of erroneously paid amount 74652 8057 Total cash available 2 374 930 258 200 Payments Transfer of remaining balance resulting from the 1 216 000 128 038 renaming of the organization Transfer to designated account in USD - UZAIFSA 1 063 000 120 822 Refunds of erroneously paid ammount 80345 8671 Bank charges 13612 1473 Total payments 2 372 957 259 004 Effect of foreign exchange difference - 1 012 Balance as at 31.12.2019 1 973 208 Signed on behalf of the Project Management on 9 July 2020. Deputy General Di ctr Chief Accountant GOanie' C ~G. Gubieva ____________ nv Me . i/;na wttine ; ,;, Ir ww 1,i 4 to/9 aOrt an utaq4ta f lb/ese s/a/elf" /ls Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless otherwise stated) 13 STATEMENT OF CURRENT ACCOUNT IN UZS Account No 20210000005049362002 Depositary Bank JSCMB Ipoteka Bank Address Tashkent, Uzbekistan Related Loan IDA 6110-UZ Currency In thousands of UZS In US dollars Balance as at 01.01.2019 Receipts Transfer from designated account in USD - UZAIFSA 2 890 428 336 062 Transfer of remaining balance resulting from the 1 216000 128038 renaming of the organization Refunds of employees payroll 662 554 72 880 Total cash available 4 768 981 536 981 Payments Consulting services, goods and works 2 074 723 235 848 Payroll 1639099 179648 Refunds of employees payroll 662 554 72 848 Operating expenses 211 805 22956 Petrol expenses 94719 10235 Bank charges 48 853 5 659 Audit services 35016 3685 Total payments 4766768 530 880 Effect of foreign exchange difference - (5 867) Balance as at 3112.2019 2213 233 Signed on behalf of the Project Management on 9 July 2020. Deputy General Direc o Chief Accountant G. Garnev < G. Gubieva \ o lbeli ndr flalf fq'w I e IP I rw5' v ttM 4 Z') If) are aw imleova ai a oIb ella-cIlewlen.c Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Notes to Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless otherse stateu 14 NOTES TO SPECIAL FINANCIAL STATEMENTS 1 CREDIT LINE FOR PRIVATE INVESTMENTS N2 Financial institution in US dollars I JSCB "Asia Alliance Bank" 3689271 2 JSC "Aloqabank" 1 312 996 3 JSCB "Asaka" 5 024 680 4 PJSCB "Davr-Bank 1 460 000 5 JSCMB "Ipoteka-Bank" 4 024 251 6 JSCB "Qishloq Qurilish Bank" 1 410916 7 JSCB "Turon Bank" 4 559 330 8 JSCB "Uzbek Industrial and Construction Bank" 3568617 9 JSC People's Bank of the Republic of Uzbekistan 18401 483 Total 43 451 544 2 PROJECT DESCRIPTION The Government of the Republic of Uzbekistan received funding from the International Development Association and the International Bank for Reconstruction and Development for the implementation of the "Livestock Sector Development Project" (hereinafter the Project). Sunmary of the project - the main objective of the pro'ect is to increase the productivity of the livestock sector, improve access to the farm and dekhkan farms, as well as create new jobs and increase the income of the rural population. The project will be implemented in the Republic of Karakalpakstan and in all regions of the Republic of Uzbekistan during 2017-2022. The main beneficiaries of the project are: farm and ceklhkan farms, private agricultural enterprises, agricultural firms for processing livestock products and other enterprises engaged in or planning to engage in animal husbandry. At the same time, the Project wvill contribute to the development of dekhkan and private farms and their inclusion in the value chains of the livestock sector. Secondary beneficiaries: participating financial institutions through advanced training in lending to the livestock sector. The project will support capacity building of public institutions such as veterinary services, research institutes. The total funding of the Project is estimated as 227,82 mln. US dollars, including: 4 IBRD loan in the amount of 30 mlin US dollars; + IDA credit in the amount of 120 mln. US dollars; 4 The Contribution of the Republic of Uzbekistan in the equivalent of 39,74 mn. US dollars; * The Contribution of beneficiaries in the equivalent of 38,08 mln. US dollars. Components of the Project: Component 1 - State investment program and public services (3 mln. US dollars from IDA funds, 5 mln. US dollars from EU funds): Sub-component 11 - Strategy, policy and public investment program (2 mln. US dollars forn EU funds); Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Notes to Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars, unless othetvise stated) 15 2 PROJECT DESCRIPTION (CONTINUED) Sub-component 1.2 - Strengthening of public services in the livestock sector (3 m1n. US dollars from IDA funds / 3 m1n. US dollars from EU funds). Component 2 - Upgrading of the livestock supply chain (112,8 mln. US dollars from IDA funds, 30 mln US dollars from IBRD funds and t1 mln. US dollars from EU funds): Sub-component 2.1 - Credit line for private investments (112,8 m1n. US dollars from IDA funds and 30 mit. US dollars from IBRD funds); Sub-cornponent 2.2 - Development of the supply chain and market inclusion of small farms (11 mln. US dollars at the expense of EU funds). Component 3 - Coordination, management, monitoring and evaluation of the project (5,2 m1n. US dollars from IDA funds). The Project consists of the following parts: Part A: Livestock Sector Public Investment Framework and Public Services Veterinary services improvement, including: (i) provision of technical assistance to improve the legal framework and strategy for development of the veterinary services; (ii) provision of Training and equipment to selected public veterinary agencies to improve disease surveillance and reporting systems, veterinary diagnostics laboratories and standard operating procedures, vaccine storage and distribution facilities, public awareness, and rapid response capacity; (iii) carrying out minor works and provision of equipment for rehabilitation of selected laboratory facilities; and (iv) provision of technical assistance for studies on border control and quarantine, veterinary drug regulation and on animal identification, registration and movement control. Part B: Credit Line for Private Investments 1. Provision, through selected PFIs, of Sub-credits to Beneficiaries. 2. Provision of technical assistance and Training to PFIs on sector-specific loan product development, loan appraisal and monitoring. Part C: Proiect Coordination, Management. Monitoring and Evaluation 1. Strengthening the IRRA's capacity for Project management, monitoring and evaluation, through provision of goods, consultants' services, Training, and financing of Incremental Operating Costs. 2. Conducting Project impact assessments at mid-term Project review and prior to the Project closure. 3. Provision of Training to Beneficiaries on Project related safeguards requirements and carrying out public awareness campaign on labor practices in agriculture. Going concern According to Finanicng Agreement, the closing date of the Project is 30 June 2022 3 ACCOUNTING POLICY Basis for presentation of financial statements These special financial statements are prepared in accordance with International Public Sector Accounting Standard (IPSAS) "Financial reporting under the cash basis of accounting". Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Notes to Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars, unless otherwise stated) 16 2 ACCOUNTING POLICY (CONTINUED) These special Financial statements have been prepared under the cash basis of accounting, in accordance with the following principles. Financing Project financing is recognized in the following cases: > when payment to suppliers of material resources, or services, is made by the Bank or the Association (procedures "Direct Payment", "Special Commitment of the World Bank"); > when transferring funds from loan or credit accounts administered by the IBRD and IDA to Designated accounts of Project opened in Ipoteka Bank and PJSCB Ravnaq-Bank. The following allocation procedures can be used for withdrawal applications: - Reimbursement: The World Bank may reimburse the borrower for expenditures eligible for financing pursuant to the Financing Agreement that the borrower has pre-financed from its own resources. 4 Advance: The World Bank may advance funds from the Financing Account into a Designated Account of the borrower to finance eligible expenditures as they are incurred and for which supporting documents will be provided at a later date. + Direct Payment: The World Bank may make payments at the borrower's request directly to a third party (for example supplier, contractor, or consultant) for eligible expenditures. + Special Commitment: The World Bank may pay amounts to a third party for eligible expenditures under special commitments entered into in writing at the borrower's request and on terms and conditions agreed between the World Bank and the borrower. Disbursement Procedures Project expenses are recognized as such and are reflected in the Financial Statements prepared under the cash basis of accounting in cases where: > payment is made to suppliers of goods, works and / or services either directly from the Loan or Credit Accounts (procedures "Direct Paymen t", "Special Commitment of the World Bank), or from Designated and Current Accounts of the Project; > when paying funds for travel expenses, salaries to Project personnel, paying taxes withheld at the source of payments, as well as paying bank interest on Designated and Current Project Accounts. The procedures for disbursement of World Bank funds are governed by the Disbursement Letter and the Project Financing Guidelines, which will be sent to the Borrower for project effectiveness and will form an integral part of the financial management section. The manual is also available on the website: http://clieticonnection.worldbank.org. The loan and credit spending period ends on the ending date set by the World Bank for the World Bank to receive withdrawal applications and supporting documentation ("Final withdrawal date"). The final withdrawal date may be the same as on the Closing Date or up to four months after the Closing Date (I'he final withdrawal date will be indicated in the Letter of Removal). As a rule, to support the orderly completion of a project and the closure of a credit account, the World Bank does not accept withdrawal applications or supporting documentation received after the Final Withdrawal Date. The borrower must immediately inform the World Bank of any expected delays in implementation or exceptional administrative matters prior to these dates. The World Bank shall notify the borrower of any exemptions that the \World Bank may make on the Final Date of Withdrawal. Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Notes to Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars. unless othervise stated) 17 2 ACCOUNTING POLICY (CONTINUED) Procurement procedures Procurement under the Project will be carried out in accordance with the World Bank Guidelines. Namely, the procurement will be carried out in accordance with: + The World Bank Guidelines: "Procurement of goods, works and non-consulting services under IBRD loans and IDA credits and grants by World Bank borrowers" datedJanuary 2011 and revised in july 2014; + The World Bank Guidelines: "Selection and Employment of Consultants under IBRD Loans and IDA Loans and Grants by World Bank Borrowers" dated JanuaryV 2011 and revised in July 2014; + Provisions provided for in the Financing Agreement. The Guideline of World Bank on Preventing and Combating fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants dated 15 October 20016 and revised in January 2011 will also be applied. Various procurement procedures will be used for the project: + Credit line purchases. Requirements and procurement procedures are described in the Regulations on the credit lines of the project separately; and + Procurement of UZAIFSAs, which are governed by the aforementioned World Bank Guidance Documents and for which a procurement specialist will be hired. The following describes the procurement procedures that the UZAIFSA shall follow. Reporting currency and methodology of conversion The currency of the special financial statements of the Project is US dollars (USD). Cash balances in Uzbek soums in the bank accounts of the Project are revalued at the official exchange rate of the Central Bank of the Republic of Uzbekistan at the reporting date. As of 31 December 2019 the exchange rate of the Central Bank of Uzbekistan is - UZS 9 507,56 / USD1. According to the disbursement guidelines for Investment Project Financing. According to the disbursement guidelines for the allocation of funds for investment project financing issued by the World Bank, point No. 5.4 the borrower bears all risks associated with foreign exchange fluctuations between (a) the currency of denomination of the loan and that of the borrower's Designated Account, and (b) the currency of denomination of the borrower's Designated Account and the currency or currencies of project expenditures. Detailed cost information by components and subcomponents of the project The information provided it this form about the expenses of the reporting period for the project in the context of the components and subcomponents of the project, the project budget for the reporting period and the deviation of actual costs from the planned ones. The project budget for the reporting period was drawn up in accordance with the network schedule and operating expenses estimate of the UZAIFSA approved by the Ministry of Agriculture and Water Resources. 4 DESIGNATED AND CURRENT ACCOUNTS During 2019, the following accounts opened in Tashkent branches ofJSCM3 "Ipoteka Bank" and PJSB "Ravnaq-Bank" were used for the purposes of financing the Project's eligible expenditures by the source of IDA: Designated Account in USD opened in JSCMB "Ipoteka Bank"; Designated Account in USD opened in PJSB "Raynaq-Bank" Current Account in LZS opened in JSCMBf3 "Ipoteka Bank"; Current Account in UZS opened in PJSB "Ravnaq-Bank". Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Notes to Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars, unless otherwise stated) 18 4 DESIGNATED AND CURRENT ACCOUNTS (CONTINUED) The balances of the designated and current accounts of the Project as at 31 December 2019 were as follows: Name of Account Source of Financing Currency Balance as at Equivalent in USD 31-12.2019 Designated account in USD - UZAIFSA IDA USD - - Designated account in USD - UZAIFSA IDA USD 998 109 998 109 Current account in UZS - UZAIFSA IDA UZS - Current account in UZS - UZAIFSA IDA UZS 1 973 208 Current account in UZS - UZAIFSA IDA UZS 2 213 233 Total 998 550 5 FIXED ASSETS Fixed assets acquired or received for the purposes of effective implementation of the Project objectives are recorded in the cost items immediately after the receipt of these funds. For the purpose of preparing these financial statements, property, plant and equipment are not depreciated and are measured at fair (revalued) cost. Fixed assets of the Project include: + Fixed assets acquired for operational needs. During the audit, on May 18, 2019, the auditors, Grant Thornton LLC carried out a sample check of the actual availability of fixed assets procured under the Project. Fixed assets held by the Project Center are presented below Name Balance as at 01.01.2019 Receipts in 2019 Balance as at 31.12.2019 in UZS in USD in UZS in USD in UZS in USD Furniture and Office 179 327 21 503 179327 18862 Equipment Computers 138755 16638 - - 138755 14594 Transport 1 338 247 160 470 - 1 338 247 140 756 Other Fixed Assets 157025 18829 - - 157025 16516 Total 1813354 217440 - 1813354 190728 Effect of changes in foreign - - - - - 26 713 exchange rate Total 1 813 354 217 440 - 1 813 354 217 440 6 LEGAL STATUS, TAXES AND OTHER CHARGES The Rural Restructuring Agency under the Ministry of Agriculture and Water Resources of the Republic of Uzbekistan is a legal entity acting on the basis of the Charter, registered by the decision of M,Ulugbek Hokimiyat of Tashkent city No. 364 dated 15 March 2000. According to the Decree of the President of the Republic of Uzbekistan No. PD-3283 dated 16 September 2017, goods (works, services) and vehicles purchased as part of the project through IBRD loan and IDA credit are exempted for the penod of the project and the warranty period from: Livestock Sector Development Project in the Republic of Uzbekistan, IDA Credit 6110-UZ Notes to Special Financial Statements under the cash basis of accounting for the year ended 31 December 2019 (in US dollars, unless otherwise stated) 19 6 LEGAL STATUS, TAXES AND OTHER CHARGES (CONTINUED) Customs payments (excluding customs duties), value added tax, fees to state trust funds for goods (works, services), equipment and vehicles purchased at the expense of IDA Credit and IBRD loan; Payment of tax on income of individuals - non-residents involved in the implementation of the contract. The benefits provided by this clause also apply to goods (works, services) purchased by farms and agricultural organizations through refinanced funds from the project. The amount of funds released as a result of the provision of benefits is the contribution of the Republic of Uzbekistan to the project. 7 RECONCILIATION OF IDA AND IBRD FINANCING There no discrepancies observed when reconciling payments by the Client Connection system with the data of UZAIFSA report in terms of financing the Project as of 31 December 2019. In US dollars Client Connection data Project data Variance (www.worldbank.org) Designated account replenishment 40 453 748 40453 748 Total 40453748 40453748