THE REPUBLIC OF SOUTH SUDAN INSTITUTIONAL DEVELOPMENT FUND (IDF) STRENGTHENING THE CAPACITY OF SOUTH SUDAN AUDIT CHAMBER (IDF GRANT NO. TF 017310) AUDIT FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2015 -The Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF o1731o) Audit report and financial statements ,For the year ended 30 June 2015 Table of contents Page Project information 1 Statement of management responsibility 2 Report of the independent auditors 3-4 Statement of income and expenditure 5 Statement of financial position 6 Statement of special account activities for the year ended 30th June 2015 7 Notes to the financial statements 8-9 The Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements 'For the year ended 30 June 2015 Project Information Principle recipient Ministry of Finance and Economic Planning - Republic of South Sudan, Juba Implementing National Audit Chamber Agency Project Name Strengthening the Capacity of South Sudan Audit Chamber (Grant Number TF 017310) - SCASSAC Project Development The objective of the grant is to strengthen the institutional systems and objective capacity of the South Sudan Audit Chamber and promote accountability in the use of public resources. This is achieved by South Sudan learning through support from regional Supreme Audit Institutions (SAls); and face-to face and on-the-job training for the staff. It will ensure effective leverage of limited financial and human resources, sharing experience, building sustainable capacity and improving audit quality Sectors Accountability Project location Activities South Sudan Project The implementation period is for three (3) years, from 30 June 2014 to implementation to July 2017. period Project Value The project cost for the 3years is US$ 299,140 Approved Grant The project cost for the 3years is US$ 299,140 from the World Bank's Institutional Development Fund Key Personnel Ambassador. Stephen Kiliona Wondu - Auditor General Mr. Tombe Logale Lukak - D. Auditor General and Project Manager Dr. Justin Valfredo Droko - D. Auditor General Mr. Dut Kuol De Dut - Project Accountant Bankers Stanbic Bank P.O. Box 630 Juba, Haile Selassie Avenue Opposite The Ministry of Telecommunication and Postal Services, Juba Town Auditors JY Auditors and Management Consultants, Hamza Inn, Juba Main Market, Juba-South Sudan Tel. +211959000297, +211928800114 Email: ivauditcon(agmail.com Website: www.iyauditorsandconsult.com 1 The Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements For the year ended 30 June 2015 Statement of Management Responsibilities Section 2.07 of the World Bank Standard Conditions requires annual preparation and submission of financial statements to the Bank (World Bank). The accompanying financial statements as at 30 June 2015 together with the supporting notes have been prepared on modified cash basis of accounting and comply with the International Public Sector Accounting Standards (IPSAS) and the World Bank Financial Reporting Guidelines. These financial statements are based on the information extracted from the books of accounts of SCSSAC and to the best of our knowledge; the financial statements are complete in all material respect as per the year ended 30 June 2015 As required by the agreement, it's our responsibility to ensure that proper books of accounts and accounting records are kept for the transactions of SCSSAC as well as maintenance of a sound system of internal control, which is to be relied upon to safeguard from misuse, the government assets in possession of SCSSAC and to prepare the financial statements of SCSSAC that are free from material misstatement whether by error or any other irregularities. To the best of our knowledge the system of internal controls has operated adequately well throughout the reporting period and the financial statements fairly reflect the financial affairs of SCSSAC for the year ended 3o June 2015 Steven Kiliona Wondu Date Auditor General National Audit Chamber S Republic of South Sudan OF 5eo o Tombe Logale Lukak Date Deputy Auditor General and Project Manager National Audit Chamber Republic of South Sudan 2 ~iriLi~ i IvIn it t itt II itI Coni S- tI I a lit !i REPORT OF THE INDEPENDENT AUDITORS ON THE FINANCIAL STATEMENTS OF STRENGTHENING THE CAPACITY OF SOUTH SUDAN AUDIT CHAMBER (SCSSAC) FOR THE YEAR ENDED 30 JUNE 2015 We have audited the accompanying financial statements of Strengthening the Capacity of South Sudan Audit Chamber (SCSSAC) which comprise of the Statement of Income and Expenditures (SOEs), Statement of Financial Position as at 30 June 2015, and a summary of significant accounting policies and explanatory information. MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards and the World Bank Financial Reporting Guidelines and for such internal controls as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. AUDITORS' RESPONSIBILITY Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing (ISAs) and World Bank Guidelines on Project Audits. Those standards (ISAs and World Bank Guidelines on Project Audits) require that we comply with ethical requirements, and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion Ineligible expenditure Included in the expenditure under the Category one, - Goods and Non Consulting Services is an amount of USD 29,000 spent on printing of financial reports for the Government of South Sudan for the years 2oo9 and 20o and Bank of South Sudan for the year 2012. The above expenses do not enhance the objectives of the grant and therefore we have classified them as ineligible expenditure. Management contends that the activity should have been funded under the MTDF grant but due to the delay in the release of the MTDF funds from the Ministry of Finance and Economic Planning, the funds for SCSSAC grant were borrowed ise the 3 AIIoITollaMtIU overdue reports. Therefore the funds will be refunded as soon as the Ministry of Finance and Economic Planning releases the MTDF grant funds. Qualified Opinion In our opinion, except for the effect of the details explained in the preceding paragraph on the Statement of Income and Expenditure, the financial statements present fairly in all material respect give a true and fair view of the financial position of Strengthening the Capacity of South Sudan Audit Chamber Project as of 30 June 2015 financed by the World Bank under Grant Number TF 017310, and of its financial performance year then ended in accordance with International Public Sector Accounting Standards and World Guidelines on Project Audits. Audit Report on Special Account In addition, in our opinion, the accompanying Special Account statements represents fairly in all material respects, the funds received and disbursements made from the Special Account of the project for the year then ended 30 June 2015 in accordance with the accounting policies as described on pages 8 and 9 Restriction on use This report is intended solely for the use of the management of the project, World Bank and the Government of South Sudan and should not be used for any other purpose. Juba, South Sudan AUDA CONSULTANTS -2015 4 rhe Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements For the year ended 30 June 2015 Statement of Income and Expenditure 3o-Jun-15 3o-Jun-14 3o-Jun-15 Cumulative Actual Actual to-date Budget Notes US$ US$ US$ US$ Contribution 2 208,509 - 208,509 299,140 Miscellaneous receipts - Total financing and available for utilization 208,,r0c - 2o8,,r0q 299,140 Goods and non consulting services 3 61,847 - 61,847 38,920 Consultant's services 4 23,635 - 23,635 170,220 Training 5 12,og - 17,,50( .000 Total project expense 102,991 - 102,991 2QQ.140 Increase in cash during the year - - Reconciliation of cash at beginning and end of year Cash at the beginning of the year Unliquidated obligations 7 17,635 17,635 Increase in cash during the year io,,, 18 15os,518 - Cash at the end of the year 6 12- 1 5 .The Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements For the year ended 30 June 2015 Statement of Financial Position Note 30-Jun-15 3o-Jun-14 Assets: Uss us$ Cash and Bank 6 123,153 Total Asset Accumulated fund 12 is -___1 Unliquidated obligations 7 17,635 Total accumulated fund and unliquidated obligations -1 5 - The financial statements were approved by the Project Management on and signed on its behalf by Stephen Kiliona Wondu Date Auditor General National Audit Chamber Republic of South Sudan Tombe Logale Lukak Date Deputy Auditor General and Project Manager National Audit Chamber Republic of South Sudan 6 The Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements For the year ended 30 June 2015 Statement of Special Account Activities for the year ended 3oth June 2015 Account No. 0200000073015 Bank: Stanbic Bank Address: P.O. Box 630 Juba, Haile Selassie Avenue Opposite The Ministry of Telecommunication and Postal Services, Juba Town, South Sudan 2014/15 US$ Opening Balance Brought Forward Add: World Bank Replenishment 26-Sep-14 Withdraw Application 1 150,000 io-Jun-15 Withdraw Application 2 58,509 Total Transfer into Special Account 2o8,509 Total Bank charges as of 30th June 2015 (117) 208,392 Bank Interest Earned Total Receipts as of 3oth June 2015 208,392 Deduct: Payments for expenses from the account 102,874 Direct payment/payment to suppliers _ (102,874) Add: Unliquidated obligations - Consultancy services 17,635 Closing balance as of 3oth June 2015 (Note 6) 123,153 7 .The Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements 'For the year ended 30 June 2015 Notes to the financial statement Note 1 - Significant Accounting Policies The principle accounting policies adopted in the preparation of these financial statements are set out below. These policies are consistently applied during the life of the project unless otherwise stated. a) Basis of preparation The financial statements have been prepared in accordance with the International Public Sector Accounting Standards based on modified cash basis. The modified cash basis of accounting recognises transactions and events only when cash including cash equivalents is received or paid by the project and supplemented by disclosures of additional items that occurred during the period for which no actual cash in or outflow has taken place. b) Receipts Receipts comprise where applicable, cash donations made directly to the projects pooled bank accounts by the World Bank as well as payments made directly to suppliers of goods and services on behalf of the beneficiary project under the categories defined in the funding agreement and as procured by the project. Receipts are recognised in the accounts when cash is received on the projects designated account. c) Payments Payments are made in line with the provisions of the funding agreement. The transactions are only recognised when cash is paid out. d) Translation of foreign currency Transactions during the year denominated in foreign currency are translated into South Sudan -Pounds (SSP) at the ruling exchange rate on the day the transaction is executed. Cash balances held in the local currency (South Sudan Pounds) are translated at the ruling rate at the financial year end. e) Fixed Assets Fixed assets are written off against income in the year of purchase. However a separate inventory of fixed assets is maintained. f) Accruals Accruals represent goods and services that have been rendered to the project during the period under review but for which no payment has been made to the supplier. Under the modified cash basis of accounting, they are recognised and reported in the financial statements. g) Currency The financial statements are presented in United States Dollars (US$). 8 rhe Republic Of South Sudan - Institutional Development Fund (IDF) Strengthening the Capacity of South Sudan Audit Chamber (IDF Grant No. TF 017310) Audit report and financial statements For the year ended 30 June 2015 h) Cash and cash equivalents For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents in hand and balances held at call in the bank. i) Budgets The budget is developed on the same accounting basis (Cash basis), same classification and for the same period as the financial statements. 3o-Jun-15 3o-Jun-14 US$ US$ 2. Contributions Withdraw applications 208,509 Direct payments to suppliers 3. Goods and non consulting services Printing of National Audit Chamber booklets and reports 57,o8o Procurement of Samsung Galaxy Notes 4,650 Bank charges 117 4. Consultancy services 5. Training expenses Travel expense 8,350 Accommodation expense 615 Per diem expenses 8A.44 6. Cash and Bank Stanbic Bank (US S$) 7. Unliquidated obligations Consultant services contract sum 23,635 Initial payment by 30 June 2015 6.ooo) - The consultant was engaged on 16th May 2015 for a period of 45days by the National Audit Chamber to carry out Audit Quality Reviews and Consolidation of financial statements and management letters for Government Ministries, Departments and Agencies covering a period of 30 months. By 30 June 2015, the consultant had been paid US$ 6,ooo hence the unliquidated obligation of US$ 17,635. 9 a