REPUBLIC OF KENYA FFICE OF THE AUDITOR-GENERAL REPORT OF THE AUDITOR-GENERAL ON THE FINANCIAL STATEMENTS OF KENYA YOUTH EMPLOYMENT AND OPPORTUNITIES PROJECT FOR THE year ENDED 30 JUNE 2018 STATE DEPARTMENT NK 11BRD /IDA RJAN 2019 Financial ManageetUi Revised Template 30/6/2018 Project Name KENYA YOUTH EMPLOYMENT AND OPPORTUNITIES PROJECT Implementing Entity STATE DEPARTMENT FOR PUBLIC SERVICE AND YOUTH PROJECT CREDIT NUMBER - 58120KE ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED JUNE 30, 2018 Prepared in accordance with the Cash Basis of Accounting Method under the International Public Sector Accounting Standards (IPSAS) Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 CONTENTS PAGE 1. PROJECT INFORMATION AND OVERALL PERFORMANCE.................................................................i 2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES.....................................................viii 3. REPORT OF THE INDEPENDENT AUDITORS ON THE KENYA YOUTH EMPLOYMENT AND O PPO R TU N ITIE S PR O JE C T ............................................................................................................................... ix 4. STATEMENT OF RECEIPTS AND PAYMENTS FOR THE PERIOD ENDED 30TH JUNE 2018..........1 5. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 2018.....................2 6. STATEMENT OF CASHFLOW FOR THE PERIOD 30TH JUNE 2018 .....................................................3 7. STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS.............................................4 8. NOTES TO THE FINANCIAL STATEM ENTS............................................................................................5 9. OTHER IM PORTAN T DISCLO SURES......................................................................................................15 10. PROGRESS ON FOLLOW UP OF AUDITOR RECOMMENDATIONS...............................................16 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 1. PROJECT INFORMATION AND OVERALL PERFORMANCE Name: The project's official name is Kenya Youth Employment and Opportunities Project Objective: The key objective of the project is to increase employment and earnings opportunities for the targeted youths. Address: The project headquarters offices are KENCOM HSE,3rd Floor Nairobi, Kenya. The address of its registered office is in Nairobi County, Kenya The project also has offices/branches as follows: * The Project does not have other offices/branches Contacts: The following are the project contacts Telephone: (254) 20227411 E-mail: ps.psy@psyg.go.ke Website: www.go.ke 1.1 Project Information Project Start Date: The project start date is 20 - May -2016 Project End Date: The project end date is 31 - Dec 2021 Project Manager: The project manager is Ms Olivia Ouko Project Sponsor: The project sponsor is GoK through a credit from World Bank IDA 1.2 Project Overview Line Ministry/State The project is under the supervision of the State Department for Public Service Department of the and Youth. project Project number P151831 Strategic goals of the The strategic goals of the project are as follows: project (i) Enhancing employability through creating jobs and expanding existing ones thus increasing earnings for youth interested in self-employment or wage employment (ii) Enhancing employability of vulnerable youth by providing targeted youth with training and internships in private sector (iii) Enhance access to labour market i Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 (iv) Strengthening youth policy development and project management Achievement of The project management aims to achieve the goals through the following strategic goals means: (i) Providing unemployed youth with relevant skills and internships in the private sector (ii) Enhancing capacity of the Ministry for youth policy Planning, Implementation, Monitoring and Evaluation. Other important The Kenya Youth Employment opportunities Project (KYEOP) is a five-year background Safety net project for vulnerable youth funded with a USD150million credit information of the from the World Bank Group and whose development objective (PDO) is "to project increase employment and earnings opportunities for targeted youths". The KYEOP is implemented through four government agencies with the Ministry of Public Service, Youth and Gender Affairs (MPYG) providing overall coordinator. The KYEOP has four components as follows: 1. Component 1: Improving Youth Employability - to be jointly implemented by the National Industrial Training Authority (NITA) and the Ministry of Public Service, Youth and Gender Affairs (MPYG) - USD75Million. o This component aims to address the issue of skills mismatch by providing targeted youth with trainings and internships in the Private Sector. The objective is to enhance youth employability. o The target is to reach over 70,000 youth 11 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 Other important background 2. Component 2: Support Job Creation - to be jointly implemented by information of the the Micro and Small Enterprises Authority (MSEA) and the MPYG) - project(continued) USD41.5 million. o This component aims to address the issue of lack of employment opportunities. The objective is to create jobs and expand existing ones thus increasing earnings for youth interested in self-employment or wage employment. o The target is to reach over 30,000 youth 3. Component 3: Improving Labour Market Information - to be implemented by the Ministry of East African Community Affairs, Labour and Social protection (MEACLSP) - USD 13.5 million o This component aims to address the issue of lack of labour market information (LMI). The objective is to enhance access to LMI and ensure availability of quality information in a timely manner. 4. Component 4: Strengthening Youth Policy Development and Project Management - to be implemented by the MPYG - USD 20million. o This component aims to enhance the MPYG 's capacity for youth policy formulation, development and monitoring and evaluation as well as support the establishment and operationalization of a project coordination unit. Though the MPYG is the overall coordinator, each implementing agency receives and accounts for funds for the KYEOP part under them separately; with the NITA and MSEA receiving/reporting through their respective line ministries i.e. Ministry of Industry, Trade and Cooperatives and the MEACLSP respectively. The KYEOP is at the stage of implementation readiness where each implanting agency is in the process of setting up systems and buildings capacities of implementing teams. Current situation that The project was formed to intervene in the following areas: the project was (i) Unemployment amongst out-of-school youth formed to intervene (ii) Lack of quality and up-to-date labour market information (iii) Inadequate Institutional Capacity for Youth Policy Planning, Implementation and Monitoring and Evaluation Project duration The project started on 20th May 2016 with the Financing Agreement being signed on 4th July 2017. The Project became effective on 15th December 2016. iii Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 1.3 Bankers The following are the bankers for the current year: a) Local Project Accounts Central Bank of Kenya. A/C No. 1000309822 Harambee Avenue P.0 Box 60000 Nairobi b) Special Deposit Accounts Central Bank of Kenya Harambee Avenue A/c No 1000308672 1.4 Auditors The project is audited by the ---Office of the Auditor General 1.5 Roles and Responsibilities List the different people who will be working on the project. This list would include the project manager and all the key stakeholders who will be involved with the project. Also, record their role, their positions, and their contact information. Names Title designation Key Responsibilities qualification Ms Olivia Ouko National KYEOP Assistant Overall Project Coordinator Director Youth Coordination Development Ms Christine Wanjira Youth intake and Assistant In charge of intake Referral Officer Director Youth and referral manual Development Mr. Peter Muthini Life Skills Assistant In charge annual Training Officer Director Youth work plans for the Development LST Mr Bernard Ngotho Core Business Assistant In charge of annual Skills Training Director Youth work plans for the Officer Development CBST Ms Rose Wangeci Project Senior In charge of finance Accountant Accountant and Accounts of the project Ms Anne Muriithi Project Supplies Chain In charge of project procurement management procurement officer officer iv Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 1.6 Funding summary The Project is for duration of 5 years from 2016 to 2021 with an approved budget of US$ 150million (use donor currency) equivalent to Kshsl5 Billion as highlighted in the table below: Below is the funding summary for Component 4 (MPYG) Source of funds Donor Commitment- Amount received to date - Undrawn balance to date (30 June 2018) (30 - June- 2018) Donor Ksks Donor Ksks Donor E(Skis currency currency currency i) Grant USD KSH USD KSH USD KSH Insert name of - - - - - donor (ii) Loan World Bank 53,300,000 5,330,000,000 3,276,722 336,930,320 50,023,278 4,993,069,680 (iii) Counter part funds Government of Kenya Total 53,300,000 ,5,330,000,000 13,276,722 336,930,320 50,023,278 4,993,069,680 NB: The whole project is worth USD150million for the four implementing Agencies. However only USD 53.3 million will be spent under the State Department for Public Service and Youth (MPYG). 1.7 Summary of Overall Project Performance: Budget performance against actual amounts for current period MPYG received Kshs.215, 566,770 in FY 2017/18 representing 52% of a budget which stood at KShs 410,822,873. Kshs.253,104,569 was utilized in FY 2017/18 representing 53% utilisation. Physical progress based on outputs, outcomes and impacts since project commencement, Management and Monitoring of the Component: The Project Coordination Unit (PCU) is established, staffed and well equipped with ICT equipment. Procurement of additional staff with special expertise has being done. The manuals are useable, but still being improved on where and when necessary. v Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 Comment on value-for-money achievements, The KYEOP attained conditions of effectiveness on 16th December 2017. Cycle 1 intake began in December 2017, with call for youth launched on the 20th of December 2017, through to the 10th of January 2018. Cycle 1 Intake targeted counties were Mombasa, Kwale, Nairobi, Nakuru and Kisumu. Life Skills Training kicked off from the 26th February 2018 followed by Core Business Skills Training two weeks later that ended on 23rd March 2018. Total applicants in Cycle I were 93,577, and the target randomized for Cycle 1 was 4,188. Final actual beneficiaries were 2,456 for internship and training which is still ongoing and 1069 youths for business support. Cycle 2 application window opened on the 5th of June, 2018 through to the 18th of June, 2018. A total of 9 counties namely; Mombasa, Kwale, Nairobi, Nakuru, Kisumu, Kitui, Migori, Turkana and Kiambu. A total of 7,005 youth will benefit from training and internship, 2,475 grants and 700 BDS. MPYG has also initiated the process of reviewing the National Youth Policy 2007 by conducting public participation fora and come with a draft NYP. List the implementation challenges and recommended way forward. * The printed budget estimates for the Financial Year 2017/18 provided for only Kshs. 207,000,000 Million against the requested Kshs. 1.2 Billion. This budget got exhausted and there was no budgetary provision to carry out any other activities as provided for in the 2017/18 Annual Work Plan (AWP) and Procurement Plan. During the revised estimates, an additional Kshs. 268.072,973 was requested but the approval for supplementary II from Parliament was not forthcoming. The approval was received at the project on 1 9th of April. 2018. This did not give adequate time for the project's activities to be implemented as they had been planned. * The IFMIS commitment functionality was disabled on 15th May, 2018 by the National Treasury through the circular no.3/2018 .This further compounded the challenges faced at the project since there was a window of only three (3) weeks to both carry out project activities which needed some procurement as well as make commitments and payments. By the end of the financial year, there were pending bills since no commitments and payments were made. All these factors affected the expected tight timeliness of project implementation hence low absorption of funds. * The project has invested heavily on IT and the developed Interim MIS is used at almost every work process within the project. This was a challenge in cycle 1 especially when paying the youth stipends. Quite a number of payments bounced and this was attributed to incorrect banks details given by the youth, inaccurate keying in of data and errors in accounts opening by the banks themselves. To mitigate against this in subsequent cycles, the PCU will now no longer rely only on the information given by the youth alone but liaise with the banks to confirm the bank details before remitting payments. * The Project Coordination Unit is yet to procure all vehicles needed for the project in all vi Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 counties of implementation. The new counties in cycle 3 and 4 which include Wajir, Mandera and Turkana are vast with very rough terrain. To be able to carry out the M&E and Impact assessment functions that have been assigned to MPYG in this project, there is need to procure all the project vehicles in line with the Project Appraisal Document (PAD). The * High expectations and the large applications received from the youth to join the project against the ability of project absorb the large numbers at a go will lead to apathy at later stages. The admissions which also have to take effect at a later stage result in high attrition rates. This therefore calls for other interventions for the youth who although they qualify cannot join the project. This poses a challenge to policy issues/direction. 1.8 Summary of Project Compliance: There were no cases of non-compliance with applicable laws and regulations, and essential external financing agreements/covenants. Hence, no consequences were suffered or likely to be. suffered on account of non-compliance. vii Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES The Principal Secretary of the State Department for Public Service and Youth and the Project Coordinator for Kenya Youth Employment and Opportunities 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 of the financial period ended on June 30th 2018. 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 Principal Secretary of the State Department for Public Service and Youth and the Project Coordinator for Kenya Youth Employment and Opportunities 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 Principal Secretary of the State Department for Public Service and Youth and the Project Coordinator for Kenya Youth Employment and Opportunities 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 period ended June 30h, 2018 and of the Project's financial position as at that date. The Principal Secretary for State Department for Public Service and Youth Affairs and the Project Coordinator for Kenya Youth Employment and Opportunities 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 Principal Secretary of the State Department for Public Service and the Project Coordinator for State Department for Public Service project confirm that the Project has complied fully 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 Project financial statements were approved by the Principal Secretary for the State Department for Public Service and Youth and the Project Coordinator for Kenya Youth Employment and Opportunities Proje on 2018 and signed by them. Pnncipal Secret Project Coordinator Project Accountant: Name: . . .Owino PhD Name: Olivia Ouko Name: Rose Wangeci ICPAK Member Number: 18723 viii REPUBLIC OF KENYA Telephone: +254-20-342330 P.O. Box 30084-00100 Fax: +254-20-311482 E-mail: oag@oagkenya.go.ke NAIROBI Website: www.kenao.go.ke OFFICE OF THE AUDITOR-GENERAL REPORT OF THE AUDITOR-GENERAL ON KENYA YOUTH EMPLOYMENT AND OPPORTUNITIES PROJECT - STATE DEPARTMENT OF PUBLIC SERVICE FOR THE YEAR ENDED 30 JUNE 2018 REPORT ON THE FINANCIAL STATEMENTS Qualified Opinion I have audited the accompanying financial statements of the Kenya Youth Employment and Opportunities Project (KYEOP) set out on pages 1 to 20, which comprise the statement of financial assets and liabilities as at 30 June 2018, and the statement of receipts and payments, statement 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 Kenya and Section 35 of the Public Audit Act, 2015. 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, except for the effect of the matters described in the Basis for Qualified Opinion section of my report, the financial statements present fairly, in all material respects, the financial position of the Kenya Youth Employment and Opportunities Project as at 30 June 2018, 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 the Financing Agreement No. 5812KE dated 4 July, 2016 and the Public Finance Management Act, 2012. Basis for Qualified Opinion 1. Unaccounted and Unsupported Other Operating Payments The statement of receipts and payments reflects an account balance of Kshs.188,740,710 under purchase of goods and services. Included in the balance is Kshs.56,090,096 relating to other operating payments as disclosed under note 8.4 to the financial statements. The account balance includes a payment to a consultant of Kshs.27,461,500 for provision of life skills training in 29 June 2018. Review of the contract document between the Project management and the training service provider shows that the contract price was based on cost per participant of Kshs.8,500 per trainee and supply of computers totaling Kshs.1,800,000 for use by trainers. Information provided by the project management shows that the actual number of youth trained was 2,584 which translate to a cost of Kshs.21,964,000 as compared to Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 June 2018 - State Department of Public Service Pomoting Accountability in the Public Sector the payment of Kshs.25,661,500 in respect of actual training resulting to an overpayment of Kshs.3,697,500 which has not been explained or reconciled. As a result, the overpayment expenditure of Kshs.3,697,500 remains unaccounted and unsupported as at 30 June 2018 contrary to Articles 226(5) and 229(6) of the Constitution. 2. Irregular Printing, Advertising and Information Supplies and Services Expenditure The statement of receipts and payments reflects an account balance of Kshs.1 88,740,710 under purchase of goods and services. Included in the balance is Kshs.11,045,816 for printing advertising and information supplies and services in respect of 300 trainer's manual, 6,200 students' workbooks and 40 3CBST syllabus. However, examination of supporting documents revealed that similar items were procured at different prices though sourced from the same supplier and paid on the same date as detailed below: S/No. Date PV. No. Description Unit Price Total (Kshs.) (Kshs.) 1. 19/4/2018 2765 Workbooks - 3100 pieces 790 2,449,000 2. 19/4/2018 2765 Trainers manual - 150 pieces 4,860 729,000 3. 19/4/2018 2765 3CBST Syllabus - 20 Pieces 2,500 50,000 4. 19/4/2018 2766 Workbooks - 3100 pieces 855 2,650,000 5. 19/4/2018 2766 Trainers manual - 150 pieces 3,650 547,500 6. 19/4/2018 2766 3CBST Syllabus - 20 Pieces 2,200 44,000 No explanation has been provided for the inconsistencies of pricing of similar goods procured from the same supplier and at the same date contrary to Article 227(1) of the Constitution. Under the circumstances, the validity and propriety of the expenditure of Kshs.11,045,816 could not be ascertained. 3. Hospitality, Supplies and Services The statement of receipts and payments reflect account balance of Kshs.188,740,710 under use of goods and services which include Kshs.5,418,622 relating to other expenditure items wrongly charged to Hospitality Supplies and Services account code 2210800 contrary to the requirements of Section 43(2)(c) of Public Finance Management Act,2012. Although management has provided a schedule of adjustment, no approved journals have been availed for audit verification. Consequently, the expenditure of Kshs.5,418,622 posted to hospitality supplies and services misstates the expenditure and understates other operating expenses. 4. Payment of Stipends to Youth The statement of receipts and payments reflect a figure of Kshs.188,740,710 for purchases of goods and services. However, the balance includes an amount of Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 June 2018 - State Department of Public Service 2 Kshs.40,833,670 in respect of training payments. The training payments includes Kshs. 16,120,450 paid in respect of stipends to the trainee youths who participated in four (4) weeks life skills training in cycle one counties namely Nairobi, Nakuru, Kisumu, Mombasa and Kwale. However, stipend paid of Kshs.16,120,450 was not fully supported as only 2,584 youths were trained and paid Kshs.6,000 each resulting in total payment of Kshs.15,504,000 leading to an unexplained and unreconciled variance of Kshs.620,450. The audit was conducted in accordance with International Standards of Supreme Audit Institutions (ISSAls). I am independent of the 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 the financial statements. There were no Key Audit Matters to report in the year under review. Other Matter 1. Youth Training Program The Project's management paid Kshs.16,120,450 in respect of stipends to the trainee youths who participated in four (4) weeks life skills training in cycle one counties namely Nairobi, Nakuru, Kisumu, Mombasa and Kwale and Kshs.27,461,500 for training consultants as provided for in the Project Implementation Manual Sub-Component 1.2:- Provision of Training and Work experience in the informal Sector and in the Work Plan for 2017/2018 financial year. However, there was no evidence of approval training curriculum that was availed for audit examination. The contract did not indicate the key result areas that the trainees needed to deliver neither were there any formal evaluations undertaken to show the extent of achievement of objectives by the training program. Consequently, I am unable to confirm that the training program was subjected to evaluation and confirmation that the intended objectives will be achieved and whether the youth received value for money on the payments of Kshs.27,461,500 and Kshs.16,120,400 in respect of training consultancy and stipend payment to trainees respectively. 2. Project performance Review of the expenditure for the project shows that Kshs.253,104,269 was incurred during the year 2017/2018 on administrative and youth training activities. Analysis of the expenditure shows that only 21% of the total expenditure was incurred directly on youth activities and programs whereas 79% was incurred on administrative activities. This puts Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 June 2018 - State Department of Public Service 3 into doubt whether the project objectives of empowering the youth will be achieved given the low allocation on the activities that impact on the beneficiaries directly. REPORT ON LAWFULNESS AND EFFECTIVENESS IN USE OF PUBLIC MONEY Conclusion As required by Article 229(6) of the Constitution, based on the procedures performed, except for the matter described in the Conclusion on Compliance and Effectiveness section of my report, I confirm that, nothing has come to my attention to cause me to believe that public money has not been applied lawfully and in an effective way. Basis for Conclusion 1. Training Expenses The statement of receipts and payments reflects an account balance of Kshs.188,740,710 under purchase of goods and services. Included in the balance is Kshs.56,090,096 relating to other operating payments as disclosed under note 8.4 to the financial statements. The amount includes a payment to a consultant of Kshs.27,461,500 for provision of life skills training paid in June 2018. The following have been observed in respect of this payment: i) The certificate of incorporation shows that the consulting service provider is a limited liability company which was incorporated on 24th May 2007 whereas the confidential business questionnaire attached in support of the payment indicated that the service provider is a Non-Governmental Organization whose certificate of registration from Non-Governmental Organization Board has not been attached. Although the engagement of consultants was presumably done by open tender through Quality and Cost Based Selection (QCBS), the status and authenticity of the firm engaged to offer training services could not be verified due to contradicting documentations. ii) Negotiation minutes dated 13th & 16th October 2017 under conclusion revealed that the consultant agreed with the State Department to vacate the original financial proposal they had presented, rework and collapse their financial proposal to provide a rate per trainee as indicated in the terms of reference. This implies that the bid awarded the contract was not in line with the requirement as stipulated in the terms of reference of the bid documents and therefore was not responsible calling for cancellation of the tender. Therefore, this constitutes amendment to the tender contrary to Section 75(1) of the Public Procurement and Assets Disposal Act, 2015. iii) The bid documents, tender opening, tender evaluation and shortlisting minutes were not provided for audit verification. Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project jr the year ended 30 June 2018 - State Department of Public Service 4 2. Sensitization Workshop for County Youth Development Officers The statement of receipts and payments reflects an account balance of Kshs.188,740,71 0 under purchase of Goods and Services which includes Kshs.26,622,770 under Hospitality Supplies and Services as disclosed under note 8.4 of the financial statements. Included in the balance is an imprest of Kshs.2, 906,400 issued to an officer to cater for Daily Subsistence Allowance to forty seven (47) County Youth Directors and the project Accountant who attended sensitization workshop for four (4) days which has not been included in the project activity work plan for the year but the objection granted explicitly directed the Project Coordinator to ensure that per diems paid to the participants were adjusted accordingly for meals included in the conference facilities. The Project management has not shown how the recommendation was implemented before payment of full per diem. No explanation has been provided for failure to observe the directive from the donor. My responsibility is to express a conclusion based on the review. The review was conducted in accordance with ISSAI 4000. The standard requires that I comply with ethical requirements and plan and perform the review so as to obtain limited assurance as to whether the activities, financial transactions and information reflected in the financial statements are in compliance, in all material respects, with the authorities that govern them. A review is limited primarily to analytical procedures and to inquiries, and therefore provides less assurance than an audit. I have not performed an audit, and, accordingly, express my conclusion in the form of limited assurance, which is consistent with the more limited work I have performed under this compliance review. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my conclusion. REPORT ON EFFECTIVENESS OF INTERNAL CONTROLS, GOVERNANCE AND RISK MANAGEMENT SYSTEMS Conclusion As required by Section 7 (1) (a) of the Public Audit Act, 2015, based on the procedures performed, I confirm that, nothing has come to my attention to cause me to believe that internal controls, risk management and overall governance were not effective. My responsibility is to express a conclusion based on the review. The review was conducted in accordance with ISSAI 1315. The standard requires that I plan and perform the review so as to obtain limited assurance as to whether effective processes and systems of internal control, risk management and governance was maintained in all material respects. The matters reported are limited to the deficiencies identified during the audit that I have concluded are material to be reported. I have not performed an audit, and, accordingly, Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 June 2018 - State Department of Public Service 5 express my conclusion in the form of limited assurance, which is consistent with the more limited work I have performed under this review. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my conclusion. Responsibilities of Management and Those Charged with Governance 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 maintaining effective 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 and for its assessment of the effectiveness of internal control. In preparing the financial statements, management is responsible for assessing the ability to sustain services, disclosing, as applicable, matters related to sustainability of services and using the applicable basis of accounting unless the management either intends to liquidate the or to 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. In addition to the responsibility for the preparation and presentation of the financial statements described above, management is also responsible for ensuring that the activities, financial transactions and information reflected in the financial statements are in compliance with the authorities which govern them, and that public money is applied in an effective manner. Those charged with governance are responsible for overseeing the financial reporting process, reviewing the effectiveness of how the entity monitors compliance with relevant legislative and regulatory requirements, ensuring that effective processes and systems are in place to address key roles and responsibilities in relation to governance and risk management, and ensuring the adequacy and effectiveness of the control environment. Auditor-General's Responsibilities for the Audit 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 and 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. Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 June 2018 - State Department of Public Service 6 In addition to the audit of the financial statements, a compliance review is planned and performed to express a conclusion with limited assurance as to whether, in all material respects, the activities, financial transactions and information reflected in the financial statements are in compliance with the authorities that govern them in accordance with the provisions of Article 229(6) of the Constitution and submit the audit report in compliance with Article 229(7) of the Constitution. The nature, timing and extent of the compliance work is limited compared to that designed to express an opinion with reasonable assurance on the financial statements. Further, in planning and performing the audit of the financial statements and review of compliance, I consider internal control in order to give an assurance on the effectiveness of internal controls, risk management and governance processes and systems in accordance with the provisions of Section 7 (1) (a) of the Public Audit Act, 2015 and submit the audit report in compliance with Article 229(7) of the Constitution. My consideration of the internal control would not necessarily disclose all matters in the internal control that might be material weaknesses under the ISSAls. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Because of its inherent limitations, internal control may not prevent or detect misstatements and instances of non compliance. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate. 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. * 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 ability to continue as a going concern or to sustain its services. If I conclude that Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 JAne 2018 - State Department of Public Service 7 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 to cease to continue as a going concern or to sustain its services. * 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 and business activities of the 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 to 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 28 December 2018 Report of the Auditor-General on the Financial Statements of Kenya Youth Employment and Opportunities Project for the year ended 30 June 2018 - State Department of Public Service 8 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 4. STATEMENT OF RECEIPTS AND PAYMENTS FOR THE PERIOD ENDED 30TH JUNE 2018 Cumulative Note' 2017/18 2016/17 to-date Receipts and -Payments Receipts and Payments payments made by payment made by controlledby third controlled by third entity arties the entity arties KShs KShs KShs KShs KShs RECEIPTS Loan from external 8.3 development partners 215,566,770 - 121,363,550 - 336,930,320 TOTAL RECEIPTS 215,566,770 - 121,363,550 - 336,930,320 PAYMENTS Purchase of goods and services 188,740,710 - 8,741,308 - 197,482,018 Acquisition of non- 8.5 financial assets 64,363,559- 19,181,819 - 83,545,378 TOTAL PAYMENTS 253,104,269 - 27,923,127 - 281,027,396 SURPLUS/DEFICIT (37,537,499) - 93,440,423 - 55,902,924 The accounting policies and explanatory notes to these financial statements are an integral part of the financ statements. Principal Secretary oject Coordinator Project Accountant Name: Dr. F. *no PhD Name: Olivia Ouko Name: Rose Wangeci ICPAK Member Number: 18723 (IPSAS 1.3.24 requires an entity to separately disclose third party payments separately on the statement of receipts and payments. 'Tiesp - are payments made by development partners directly on behalf of the entity. In recognising these transactions, the receipts must be equal to the payments made and therefore there is no surplus or deficit.) 1. Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 3. REPORT OF THE INDEPENDENT AUDITORS ON THE KENYA YOUTH EMPLOYMENT AND OPPORTUNITIES PROJECT Auditor General, KENYA Date ix Kenya Youth Employment and Opportunities Project ;Reports and Financial Statements For the financial year ended June 30, 2018 5. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 2018 Note 2017/18 2016/17 KShs KShs FINANCIAL ASSETS Cash and Cash Equivalents Bank Balances 8.6 A 45,863,354 93,440,423 Cash Balances 8.6 B - - Cash equivalents (Cash in transit) 8.6 C 10,039,570 - Total Cash and Cash Equivalents 8.6 55,902,924 93,440,423 Accounts receivables - Imprest and Advances 8.7 - - TOTAL FINANCIAL ASSETS 55,902,924 93,440,423 REPRESENTED BY Fund balance b/fwd 8.8 93,440,423 93,440,423 Prior year adjustments 8.9 - - Surplus/Deficit for the year (37,537,499) 93,440,423 NET FINANCIAL POSITION 55,902,924 93,440,423 The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. The financial statements were approved on 2018 and signed by: Principal S Project Coordinator Project Accountant D Date Date Sc(((-0(s ICPAK Member Number: 18723 2 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 6. STATEMENT OF CASHFLOW FOR THE PERIOD 30TH JUNE 2018 2017/18 2016/17 Note KShs KShs Payments for operating activities Purchase of goods and services 8.4 (188,740,710) (8,741,308) Changes in receivables (10,039,570) Adjustments during the year 8.9 Net cash flow from operating activities (198,780,280) (8,741,308) CASHFLOW FROM INVESTING ACTIVITIES - _ - Acquisition of Assets 8.5 (64,363,559) (19,181,819) Net cash flows from Investing Activities - _ _ CASHFLOW FROM BORROWING ACTIVITIES - - Proceeds from Foreign Borrowings 8.3 215,566,770 121,363,550 Net cash flow from financing activities 215,566,770 121,363,550 NET INCREASE IN CASH AND CASH EQUIVALENT (47,577,069) 93,440,423 Cash and cash equivalent at BEGINNING of the year 93,440,423 - Cash and cash equivalent at END of the year 8-6C 45,863,354 93,440,423 The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. The entity financial statements were approved on 2018 Principal Secretary Project Coordinator Project Accountant Date Date A IDate dow(. ICPAK Member No.18723 3 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 7. STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS Actual on Budget % of Original Comparable Utilization Utilizat Receipts/Payments Item Budget Adjustments Final Budget Basis Difference ion a b c=a+b d e=c-d f-d/c % Receipts Proceeds from borrowings 192,750,000 218,072,873 410,822,873 215,566,770 195,256,103 52% Miscellaneous receipts Total Receipts 192,750,000 218,072,873 410,822,873 215,566,770 195,256,103 52% Payments Purchase of goods and services 192,750,000 217,372,873 410,122,873 188,740,710 219,185,163 47% Acquisition of non-financial assets - 73,500,000 73,500,000 64,363,559 9,136,441 88% Total Payments 192,750,000 287,372,873 480,122,873 253,104,269 227,018,604 52% Note: The significant budget utilisation/performance differences in the last column are explained in Annex 1 to these financial statements. Principal Secretary Project Coordinator Project Accountant Date I Date ?o(1t1"1-t ICPAK Member No.18723 4 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 8. NOTES TO THE FINANCIAL STATEMENTS The principal accounting policies adopted in the preparation of these financial statements are set out below: 8.1. Basis of Preparation 8.1.1. Statement of compliance and basis of preparation The financial statements have been prepared in accordance with Cash-basis IPSAS financial 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 include imprests and salary advances and b) payables that include deposits and retentions. The financial statements comply with and conform to the form of presentation prescribed by the PSASB. The accounting policies adopted have been consistently applied to all the years presented. 8.1.2. Reporting entity The financial statements are for the Kenya Youth Employment and Opportunities Project under National Government of Kenya. The financial statements encompass the reporting entity as specified in the relevant legislation PFM Act 2012. 8.1.3. Reporting currency The financial statements are presented in Kenya Shillings (Kshs), which is the functional and reporting currency of the Project and all values are rounded to the nearest Kenya Shilling. 8.2. 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. * Transfers from the Exchequer Transfer from Exchequer is be recognized in the books of accounts when cash is received. Cash is considered as received when payment instruction is issued to the bank and notified to the receiving entity. *External Assistance External assistance is received through grants and loans from multilateral and bilateral development partners 5 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 Donations and arants 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. Proceeds from borrowing Borrowing includes Treasury bill, treasury bonds, corporate bonds, sovereign bonds and external loans acquired by the Project or any other debt the Project may take on will be treated on cash basis and recognized as a receipt during the year they were received. Undrawn external assistance These are loans and grants at reporting date as specified in a binding agreement and relate to funding for the Project currently under 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 summary * Other receipts These include Appropriation-in-Aid and relates to receipts such as proceeds from disposal of assets and sale of tender documents. These are recognised in the financial statements the time associated cash is received. 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 consumed, they shall be disclosed as pending bills. * Interest on borrowing Borrowing costs that include interest are recognized as payment in the period in which they incurred and paid for. 6 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 SIGNIFICANT ACCOUNTING POLICIES (Continued) * Repayment of borrowing (principal amount) The repayment of principal amount of borrowing is recognized as payment in the period in which the repayment is made. The stock of debt is disclosed as an annexure to the consolidated financial statements. * Acquisition of fixed assets The payment on acquisition of property plant and equipment items is not capitalized. The cost of acquisition and proceeds from disposal of these items are treated as payments and receipts items respectively. Where an asset is acquired in a non-exchange transaction for nil or nominal consideration and the fair value of the asset can be reliably established, a contra transaction is recorded as receipt and as a payment. A fixed asset register is maintained by each public entity and a summary provided for purposes of consolidation. This summary is disclosed as an annexure to the consolidated financial statements. c) In-kind donations In-kind contributions are donations that are made to the Project in the form of actual goods and/or services rather than in money or cash terms. These donations may include vehicles, equipment or personnel services. Where the financial value received for in-kind contributions can be reliably determined, the Project includes such value in the statement of receipts and payments both as receipts and as payments in equal and opposite amounts; otherwise, the contribution is not recorded. d) 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 are 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 statements, 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. Restriction on cash Restricted cash represents amounts that are limited/restricted from being used to settle a liability for at least twelve months after the reporting period. This cash is limited for direct use as required by stipulation. Amounts maintained in deposit bank accounts are restricted for use in refunding third part deposits e) Accounts receivable 7 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 For the purposes of these financial statements, imprests and advances to authorised public officers and/or institutions which were not surrendered or accounted for at the end of the financial 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. f) 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 payments are included in the statement of receipts and payments in the year in which the payments are made. g) Budget The budget is developed on a comparable accounting basis (cash basis), the same accounts classification basis (except for accounts receivable - outstanding imprest and clearance accounts and accounts payable - deposits, which are accounted for on an accrual 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 consolidation. 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. h) Third party payments Included in the receipts and payments, are payments made on its behalf by to third parties in form of loans and grants. These payments do not constitute cash receipts and payments and are disclosed in the payment to third parties column in the statement of receipts and payments. During the year there were no loan disbursements received in form of direct payments from third parties. 8 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 SIGNIFICANT ACCOUNTING POLICIES (Continued) i) Exchange rate differences The accounting records are maintained in the functional currency of the primary economic environment in which the Project operates, Kenya Shillings. Transactions in foreign currencies during the year/period are converted into the functional currency using the exchange rates prevailing at the dates of the transactions. Any foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statements of receipts and payments. j) Comparative figures Where necessary comparative figures for the previous financial year/period have been amended or reconfigured to conform to the required changes in financial statement presentation. k) Subsequent events There have been no events subsequent to the financial year/period end with a significant impact on the financial statements for the year ended June 30, 2018. 1) Errors Material prior period errors shall be corrected 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 before the earliest prior period presented, restating the opening balances of assets, liabilities and net assets/equity for the earliest prior period presented. 9 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 NOTES TO THE FINANCIAL STATEMENTS (Continued) 8.3. LOAN FROM EXTERNAL DEVELOPMENT PARTNERS During the 12 months to 30th June 2018 we received funding from development partners in form of loan negotiated between the National Treasury and donors as detailed in the table below: Date Amount in Loans Loans Total amount in KShs received loan received in received currency Cash as direct payment* USD KShs KShs 2017/2018 2016/2017 KShs KShs Loans Received from - - - - - - Bilateral Donors (Foreign Governments) Loans Received from Multilateral Donors (International Organisations) - - - - - - World Bank (IDA) 14-03-2018 1,990,000 205,527,200 205,527,200 121,363,550 19-06-2018 99,382 10,039,570 10,039,570 Total _t__ 2,089,382 215,566,770 215,566,770 121,363,550 10 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 NOTES TO THE FINANCIAL STATEMENTS (Continued) 8.4. PURCHASE OF GOODS AND SERVICES Cumulative to- FY 2017/18 FY 2016/17 date Payments made by the Entity in Payments made Cash by third parties Total Payments KShs KShs KShs KShs KShs Utilities, supplies and services - - - - Communication, supplies and services 361,500 - 361,500 - 361,500 Domestic travel and subsistence 39,198,454 - 39,198,454 2,802,705 42,001,159 Foreign travel and subsistence 13,534,504 - 13,534,504 1,862,128 15,396,632 Printing, advertising and - information supplies & services 11,045,816 - 11,045,816 594,199 11,640,015 Rentals of produced assets - - - - - Training payments 40,833,670 - 40,833,670 458,276 41,291,946 Hospitality supplies and services 26,622,770 - 26,622,770 364,000 26,986,770 Fuel and Other Lubricants 1,020,100 - 1,020,100 - 1,020,100 Insurance costs Specialized materials and services -_- Other operating payments 56,090,096 - 56,090,096 2,660,000 58,750,096 Routine maintenance - vehicles and other transport equipment 33,800 - 33,800 - 33,800 Routine maintenance- - other assets __- - - Exchange rate losses/gains (net) -- - - - Total 188,740,710 - 188,740,710 8,741,308 197,482,018 11 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 NOTES TO THE FINANCIAL STATEMENTS (Continued) 8.5. ACQUISITION OF NON-FINANCIAL ASSETS Cumulative to- FY 2017/18 FY 2016/17 date Payments Payments made by the made by Entity in third Total Cash parties Payments KShs KShs KShs KShs KShs Purchase of vehicles & other transport equipment 62,166,559 - 62,166,559 - 62,166,559 Purchase of office furniture & general equipment 2,197,000 - 2,197,000 19,181,819 21,378,819 Total 64,363,559 - 64,363,559 19,181,819 83,545,378 8.6. CASH AND CASH EQUIVALENTS C/FWD 2017/18 2016/17 KShs KShs Bank accounts (Note 8.6A) 45,863,354 93,440,423 Cash in hand (Note8.6B) - - Cash equivalents (short-term deposits) (Note 8.6C) 10,039,570 - Total 55,902,924 93,440,423 The project has One project account spread within the project implementation area and One foreign currency designated accounts managed by the National Treasury as listed below: 8.6. A Bank Accounts 2017/18 2016/17 KShs KShs Foreign Currency Accounts Central Bank of Kenya [A/c No 1000308672] Total Foreign Currency balances - - Local Currency Accounts Central Bank of Kenya [A/c No 1000309822] 45,863,354 93,440,423 Others (specif) - Total local currency balances 45,863,354 93,440,423 Total bank account balances 45,863,354 93,440,423 12 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 NOTES TO THE FINANCIAL STATEMENTS (Continued) Below is the Special Deposit Account (SDA) movement schedule which shows the flow of funds that were voted in the year. These funds have been reported as loans/grants received in the year under the Statement of Receipts and Payments. Special Deposit Accounts Movement Schedule 2017/18 2016/17 KShs KShs (i) A/C Name [A/c No 1000308672] Opening balance - - Total amount deposited in the account 215,566,770 121,363,550 Total amount withdrawn (as per Statement of Receipts & Payments) 215,566,770 121,363,550 Closing balance (as per SDA bank account reconciliation attached) - The Special Deposit Account(s) reconciliation statement(s) has (have) been attached as Appendix 3 support these closing balances. 8.6. B Cash In Hand 2017/18 2016/17 KShs KShs Location 1 - Location 2 - Location 3 - Other locations (specify) - Total cash balances -_ 8.6. C Cash equivalents (short-term deposits) 2017/18 2016/17 KShs KShs Bank Name [A/C No......] Total There were no short-term deposits at the end of the period 13 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 NOTES TO THE FINANCIAL STATEMENTS (Continued) 8.7. Outstanding Imprests ,Advances and Cash in Transit Amount Due Date Amount Balance Balance Name of Officer or Institution of Surrender Taken Surne d2018 2017 Surrender ed State Department of public 10,039,570 service & youth( cash in transit) Total - - - 10,039,570 The amount ofKShs 10,039,570 relates to an amount due from state department ofpublic service and youth that was received as exchequer but was yet to be transferred to the project account. 8.8. CASH AND CASH EQUIVALENTS B/FWD 2017/18 2016/17 KShs KShs Bank accounts 93,440,423 Cash in hand - Cash equivalents (short-term deposits) - _- Outstanding imprests and advances - Total 93,440,423 - 14 Kenya Youth Employment and Opportunities Project Reports and Financial Statements For the financial year ended June 30, 2018 NOTES TO THE FINANCIAL STATEMENTS (Continued) 8.9. PRIOR YEAR ADJUSTMENT 2017/18 2016/17 KShs KShs Bank accounts Cash in hand Cash equivalents (short-term deposits) Receivables - Outstanding Imprests Total - 9. OTHER IMPORTANT DISCLOSURES 9.1 PENDING ACCOUNTS PAYABLE (See Annex 2A) 2017/18 2016/17 KShs KShs Construction of buildings __-_- Construction of civil works - - Supply of goods 975,871.25 1,217,681 Supply of services 1,285,386.15 - Totals 2,261,257.40 1,217,681 Note: This amount was not payable due to system challenges. 15 . •а .е � � � � � и и и и и .� � .� .� � �., ° � •у � � � � � -б � w о о о о � '� �w.! а� ( � � `у ° � V V V � � а) 3 у � � д ° 'й .� iy о о о о +� .-� с, я. я. r3..� . � ° ;� � °: �= °: °�' � � ° � о � � � � � � � � ° а� ° � �>;� � a�i й й � � ¢, � N С7 С7 С7 С7 у � � �. �. � �. о° � о о о о �. � � � � � � � ч-�`', � ° д ¢ д д � � ° � � � � � � � � � � �«-� et � � � � .� � +-и• .'"' � ."' ° с°�i c�i с°�i v � �� й� i о о о о " �� � � � ° � � � � й � � � -� > > > ,� � � � у '�t ° � �� � � � � � � � й � ° ° z �� �� О оиi о о о о > ° �'� �'� z х z z z z ,� А � � .� � .� � '� Z .,., � .� .� �. .� � а� W � � �° � � v � v � v � v � �" �� � �.. � а� � � о а� et 'о � •о � •о 'b •о � У °��' о о о .. � � й � й о�, •� а � а � а о а. � � .. � �о о сд � о� и Й"° и д д U д � � '� V �� Г� с� г�. �� b � � а� � LY, � й о о � � � о ° и '� '� О О N V О �� ''r (� ° � � =� � Гу 'б '° N �-+ ,� А л •° � ° ° ¢ ¢ � a�i � � i � ,n > д � � � � о ° о � ,-д a�i �У д .� а� � и о о о о ��� о аэ � � �. � �. � � �' й� а� � ьд3 ад3 •��°v•°�с° '� •" °о о '� ° wo а� ° � о � � �- � .� '~' *~ �, > � •� . •+� ... д � я � � � � N а' и о �� ; а� ; и ��.� i о ° � О.. � � j � � �'_' �:s�^' � к ш к а й 'д О rз и � с� О' й О' й W С7 W С7 � с� 4��и, � о �, о ` и � О�� �1 о� 6 и � о '� °' '' О � о х°, s . � � �� 'Н �"� � р. и Ф � и Q � у � �''�+ � z �� С7 �' v у о • U с� и °' �, � О и сс�з о � .�'�, п � � О -д д с •с� о°i й ,� � '� � о � � и ,�" a�i й=' � °' � q+ '�' � °и у � ,+�'_, О. � � i., U � с�э ,Н � й W .� � � '� � �'' й .s1 � � с�б � � о^' О ;� ° ~ � „°w � о ,�'�� ►=0д � �гдОа � а � � � � w '� ез о о � ° �, � С � � ° � � � � � � � •� с� ',,и, С� ч0� � � � ° �1 й ,*'U � � О� i О. � � . н � ° � � � V'' � С� � � � w '"' �' � � °' ° � � ° . . xz � �а � N � N � � � � �. �° � � � .� и � о а и N �., � •н � N � � л � а� .. � Н � � •� � о � � о Z и д"' О N .�, 5�., � � О •., f�, О � � и с�б .� U +-' ir � � О 'С3 •� � � '� � � � � О � � О о .S � � �р � +, ,� .,�, „(� � О ,`, 3 � �' А � � � � � � � � �О � '_'•' � •� � � N C�i ; r �О ��'' О +��., N й Z т` О й О М " pq � � .��^ v � � � > � �i� �•� ° � .°�„' � °�' .� а� � ,et b �, � � о� ti1 � � е� � � � �. ед о о ,� •G C�i •� и > О � � � О" � �v О •.� й � l` W �V •V � � � +�.� 'Zi � � � �' __ �1 � � о � � ~ � w � � � ' а .., г� •� � •� Гi) � R i _ �--� .а °, �г�гг°, � � а А � .., � !-―커,..,.[.· rn rn rn rn и и rn rn rn rn rn rn rn rn rn и rn r, .--, .--� .--, ,� ,� ,� .--� ,--� .--� .-� ,� .-, r, ,� ,-� � ' ; о о о о о о о о о о о о о о о о о с� г� су с� си cv cv N г� с� су с�1 N с� cv ги cV 1 I 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 00 00 00 00 00 00 00 00 00 00 00 ОС 00 ОО 00 00 ОС �-Ч г-1 в�-1 .--1 .-Ч �-1 �-1 � в�1 �1 .--1 в--1 r1 г-1 .--i .--1 г1 о о о о о о о о о о о о о о о о о cv cv с� с� cv cv с� cv г� с� с� cv cV си с� c�t N � � � � � � � � � � � � � � � � � w w w w w w Г3, Gz� w w w Г3. 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