F I ! $cran GRouP TSIAR.FINANS, LLC I Uzbekistan, Tashkent, 100077,2a, Chust street 8 Tel/Fax: (998-71) 262-50-70i 262-0847i 262-0841 L I E-mail: receotion@ciar,uz; receDiion@ciarorouD,net ! www.ciar.uz I I I (THE MODERNIZATION OF REAL PROPERTY REGISTRATION AND CADASTRE PROJECT" IDA CREDIT NO.5761-UZ I I INDEPENDENT AUDITOR'S REPORT ON THE SPECIAL PURPOSE FINANCIAL STATEMENTS FOR THE PERIOD FROM 01 JANUARY 2018 I TO 31 DECEMBER 2018 I I t I ! ! i r I lndependent Member of > GENE,A GRouP TNTERNATToNAL I t I $crnncRouP TSIAR-FINANS, LLC I I CONTENT t CONTENT INDEPENDENT AUDITOR'S REPORT .....',3 I STATEMENT OF SOURCES AND USES OF FUNDS I I STATEMENT OF USES OF FUNDS ON EXPENDITURE TYPES AND COMPONENTS .''...,6 t STATEMENT OF FINANCIAL POSITION ....-..... USD DESIGNATED ACCOUNT STATEMENT .......8 T EURO TRANSIT ACCOUNT STATEMENT...... I UZS TRANSIT ACCOUNT STATEMENT...... SOE WITHDRAWAL SCHEDULE .. 10 ........... 11 I NOTES TO PROJECT SPECIAL PURPOSE FINANCIAL STATEMENTS..... ................. 12 t 't. DEScRTPTToN oF THE PRoJEcr 12 I 2. GotNG coNcERN ......... 13 AccouNTrNG PoLrcY IJ I 4. PRESENTED FINANCAL STATEMENTS. 14 I 6. PRopERTy, PLANT AND EoutpMENT....................... 15 7. STATEMENT OF EXPENDITURE (SOE) 8. EVENTS AFTER REPoRTING DATE - 16 9. TMES AND LEVES 16 REcoNcILIATIoN oF IDA CREDTT FINANCING I atcren cROUP TSIAR.FINANS, LLC I t INDEPENDENT AUDITOR'S REPORT Addressees: Management of the State Committee of Republic of Uzbekistan for Land Resources, t Geodesy, Cartography and State Cadastre t We have audited the accompanying Special Purpose Financial Statements of (The Modernization of Real property Registration and Cadastre ProjectD (hereinafter - Project) financed from credit proceeds of the lnternational Development Association (hereinafter - Association, IDA) according to the Financing agreement t No.5761-UZ dated 16 September 2016 (hereinafler - Financing agreement), foithe period from-O11anuary 2018 to 31 December 2018. Special Purpose Financial Statements include Statement of Sources and Uses of Funds, Statement of Uses of I Funds on Expenditure Types and Components, Statement of Financial Position, Designaled Accounl Statement, TransitAccount Statements, SOE Withdrawal Schedule, Notes to Financial Statements. I Special Purpose Financial Statements prepared by the management of the State Committee of Republic of Uzbekistan for Land Resources, Geodesy, cartography and state cadastre (hereinafter - Goskomzemgeodezkadastr) based on the cash flow basis in accordance with lnternational public Sector t Accounting Standards (hereinafter - IPSAS) issued by the lnternational Public Sector Accounting Standards Board of the lnternational Federation of Accountants. t Management's Responsibility The management of Goskomzemgeodezkadastr is responsible for preparation and fair presentation of these special purpose financial statements based on the cash flow basis in accordance with lpSAS. This I responsibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of the special purpose financial statements that are free from material missta6ment, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates t that are reasonable in the circumstances. Auditor's Responsibility t Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with lnternational Standards on Auditing (lSA). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financijl I 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 auditofs judgment, including the assessment of t the risks of material misstatement of the financial statements, whether due to fraud or erior. ln making those risk assessments the auditor considers internal control relevant to the preparation and fair presentalion of the Project' financial statements in order to design audit procedures that are appropriate in the circumstances, but t not for the purpose of expressing an opinion on the effectiveness of the Pro.iect's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Project's management, as well as evaluating the overall presentation of the financia-i statements. t We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. t t I t $cren GRouP TSIAR.FINANS, LLC I Opinion 4 I ln our opinion, the above-stated Special Purpose Financial Statements give a true and fair view of the sources and uses of the "The Modernization of Real Property Registration and Cadastre" Project funds for the period from 01 January 2018 to 31 December 2018 and complies with conditions of the Financing Agreement I and IPSAS. Moreover, (a) with respect to SOEs, adequate supporting documentation has been maintained to support I claims to the IDA for reimbursement of expenditures incurred under the Credit No.5761-UZ; and (b) the expenditures comply with objectives stipulated in the Financing Agreement No. 5761-UZ. ln our opinion, the Designated and Transit Accounts Statements on IDA Credit No. 576'l-UZ for the period I from 01 January 2018 to 31 Decem ber 2018 give a true and fair view of the financial position of the Designated and Transit Accounts of the Project as at 31 December 2018 and of the cash flows for the for the year then ended and complies with the World Bank's guidelines. t Emphasis of Matter Without modifying our opinion, we draw your attention to the Note 2 "Going concern" of the Special Purpose Project Financial Statements, which disclose that the closing date of the Credit is September 30, ?021. T t Basis of Accounting Without modifying our opinion, we draw attention to Note 3 to the Special Purpose Financial Statements, which describes the basis of accounting. The Special Purpose Financial Statements are prepared to assist the t Project to comply with the financial reporting provisions on the requirements conditions of the Financing Agreements and IPSAS. As a result, the Special Purpose Financial Statements may not be suitable for another purpose. T Other Matter t Financial Audit reports and opinions, as ruled by the requirements set by the World Bank, shall be uploaded, published and publicly accessible on the World Bank's website. I t F/rralc lzZ Auditors: ]"ttfr'"',H[:,:f:.,*".,, 7s//2- 100077, Republic of Uzbekistan t 16 August 2019 I I I I I t pRoJEcr, (The Modernization of Real property Registration and cadastre, IDA credit No.5761-uz I STATEMENT OF SOURCES AND USES OF FUNDS for the period from 01 January 2018 to 3l December 2018 (USD) I Actual Buclget Year to Date Cumulative Year to Date Cumulative Year to Date Variance Cumulative I Opening Cash Balance USD Designated Account UZS Transit Account 10 387 EURO Transit Account 0 T Total 10 541 t Adcl: Funds of IDA I Designated Account Replenishment Direct Payments Total funds of IDA 1 002 888 1 002 888 0 1 054 015 I 054 0 0.t 5 20 000 000 18 945 985 t Government Funds Funds Co-financing of GKZGDK Total Government funds 175152 397 225 I 175',t52 397 225 5 000 000 4602775 Total 1 178 040 't 451 240 25 000 000 23 548 760 I Less.' Uses of Funds Goods, software, equipment 68 23s 242 785 108 000 10 029 000 39 765 I 786 215 I Consultants services Technical services Staff Training 162 880 0 0 162 880 1 155 0 1 007 000 0 0 692 000 7 563 600 645 000 844 120 0 0 529 120 7 563 600 643 845 I Production works Social development Project management (PlU staff) 0 0 't77 359 0 0 0 0 832 000 498 000 0 0 832 000 498 000 I 107 738 120 000 600 000 12 262 422 641 Operating Costs 36 289 53 621 65 000 550 000 28 711 496 379 Contingencies 0 0 0 3 590 400 0 3 590 400 t I Total 37 5 142 637 800 300 000 25 000 000 924 858 24 362 200 Closing Cash Balance USD Designated Account 813 429 813 429 I UZS Transit Account EURO Transit Account Total 813 440 11 0 813 440 11 0 I I Signed by management on '14 August 2019 I )t..p.l*- I Mamatov A. Vice-chairman of GKZGDK Chief Accountant of GKZGDK Project Fanance Specialist r "Stalement of Sources and Uses of Funds" lo be read in conjunction with Notes (pages from 12 to 16) thereto fnrminn an intanr2l narl lha Pr^ia^f c^a^i.l fin-^^i^l -,^r^-^-r^ T (The Modernization of Rear property Registration and pRoJEcr, I cadastre,r STATEMENT OF USES OF FUNDS ON EXPENDITURE TYPES AND COMPONENTS rDA credit No.5761-uz 6 I for the period from 01 January 2O1g to 31 December 2018 (usD) t Actual Budget Variance I Year to Date Cumulative Year to Date Cumulative Year to Date Cumulative I Component A - Real Propertv Reqistration and Cadastre Svstem Develooment 77 899 239 877 173 000 l3 385 600 95 101 13 145 723 Component B - Real Propertv I Reoistration and Cadastre Data DeveloDment 0 0 0 3 650 000 0 3 650 000 Component C - Use of Real propertv I Reqistrv and Cadastre Data Comoonent D - lnstitutional 24 44A 24 448 155 000 1 469 000 130 552 1 444 552 Develoomenl and Proiect 272 795 373 475 972 000 2 905 000 699 205 2 531 525 I Manaoement lnstitutional Development 96 455 96 455 607 000 975 000 5'1 0 545 878 545 I Trainino needs assessment/ Traininq Drooram develoDment/ Trainino Dortal 0 0 125 000 645 000 125 000 645 000 desion and establishment I Customer su'Vevs 16 977 16 977 10 000 60 000 (6 e77) 43 023 I Fumiture and equipment for pltJ 15 336 27 908 30 000 75 000 14 664 47 092 I Proiect Audit 0 0 '15 000 75 000 15 000 75 000 Proiect Manaoement inctudina p J 144 028 232 135 185 000 1 075 000 40 973 I Salarv 842 865 Continoencv 0 0 3 590 400 0 3 590 400 I Total 375142 637 800 I 300 000 25 000 000 924 858 24 362 200 I I tutu Signed by management on 14 August 2019 I I Vice-chairman of GKZGOK Chief Accountant of cKZGDK Project Finance Specialist I "Statement of Uses of Funds on Expenditure Types and Components" lo be read in conjunction with Notes I /nanas from 12 to 1A\ thpretal formino an intporal n.rl arf thF Prniect enpeial finanniel with assistance of lnternational Development Association (hereinafter UP Resolution), t pro.iect will be funOed by IDA Credit and Government. Contribution of Government of Uzbekistan in the project impiementation ts, in equivalent of USD 15,77 M, including USD8,05M in kind of tax and duty exemptions, and other mandatory public charges, USD2,72M to cover financial costs during the Project lnvestment period and t USDs,OM as flnancing from the Fund of The State Committee of Republic of Uzbekistan for Land Resources, Geodesy, Cartography and State Cadastre (hereinafter - GKZGDK). Financing Agreement and Uzbekistan Presidential Resolution No.nn-2571 designates the GKZGDK as an I Executive Agency responsible for the implementation of (The Modernization of Real property Registration and Cadastre Prolectr, targeted (effective) and eflicient use of if the IDA funds, as well for the achieving all Key Project Objectives. I For the purpose of facilitation of the Program implementation, GKZGDK has established the Project lmplementation Unit (hereinafter - PIU). l The development objective ofthe Project for Uzbekistan is to establish an efficient and accessible real property registration and Cadistre system in the Republic of Uzbekistan as part of the national Government structure and services. The Project will achieve this by: I / / improving business processes and customer orientation in the real property register and Cadastre; creating a fully digital real property register and Cadastre system that is accessible online to the public: t / / improving the regulatory and operational environment of the real property register and Cadastre; facilitating spatial data access, exchange and sharing at the national level: and I / raising awareness on the importance of real property rights. Project financing plan is stated below: t IDA funds USD 20 000 000 I Government funds, including 15 770 700 Funds of GKZGDK 5 000 000 - Funds of the State Budget of the Republic of Uzbekistan 10 770 700 I Total GOU contribution exemptions or compensation: non-resident income tax for income generated in is Uzbekistan, non-resident income tax, value added tax, customs duties and taxes (excluding customs fee), 35 770 700 I mandatory contributions and fees to the public/state ear-marked funds as well as covering financial costs during the investment period of the Project. I (The Modernization of Real property Registration and cadastreD PRoJECT, IDA Credit No.576'l'UZ 13 The IDA funds available for the Project implementation are intended for flnancing the following categories: USD Category Amount CooaJ, wort