• . ■ . ■ 勿 . • . 一TRANSPORTATION WORKS CONSTRUCT10N INVESTMENT PROJECT IVIANAGEMENT 一AUTHORITY OF HO CHI MINH CITY •Ho CH&MINH CITY GREEN TRANSPoRT DEVELoPMENT PRoJECT Under Financing Agreement No,5654一VN ■ ■AuoIT日0 FINANcIAL sTAT日MENTs ■FOr the year ended 31 December Zola •丫一_。一雜 ■ ■ ■ • . ■ ■ ■ ■ . ■ • • ■ . ■ ■ ■ ■HO Chi Mjnh City, May 20伯 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT Urban-Civil Works Construction Investment Management Authority (UCCI) Financing Agreement No. 5654 - VN TABLE 0 F CONTENTS CONTENT PAGE PART] FINANCIAL STATEMENTS Report of The project management unit 03 Independent auditors' report 05 Statement of sources and uses of fund 08 Statement of financial position 09 Statement of receipts and disbursements 10 Statement of designated account 11 Statement of loan withdrawals 12 Notes to the financial statements 13 PHAN 11 AUDITORS' REPORT ON THE INTERNAL CONTROL OVER 19 PREPARATION OF THE FINANCIAL STATEMENTS PHAN III AUDITORS' REPORT ON THE COMPLIANCE 22 PHANIV MANAGEMENT LETTER 25 . . . . . 加 . . PART 1 . . FINANCIALSTATEMENTS . . . ■ .二 tA」 図B』 L .生 SO . \0 .こ . . . . . . . . . . . . . . .2 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT The Project Management Unit of Transportation Works Construction Investment Project Management Authority of Ho Chi Minh City (TCIP) Fina icing Agreement No. 5654 - VN REPORT OF THE PROJECT MANAGEMENT UNIT The Project Management Unit of Transportation Works Construction Investmant Project Management Authority of Ho Chi Minh City (hereinafter referred to as "TCIP" or "Project Management Unit") submits its report together with the audited financial statements orf the Ho Chi Minh City Green Transport Development Project - Financing Agreement No. 5654 -VN (hereinafter referred to as "the Project") for the ended -1 December 20418. THE PROJECT MANAGEMENT UNIT The Project Management Unit of TCIP who held the Project during the year and to the date of this report are as follows: Mr Luong Minh Phuc Project Director of Transportation Works Construction Investment Project Management Authority of Ho Chi Minh City Mr Ha Quoc Linh Director of Green Transport development Project Mr Nguyen Tran Thanh Binh Deputy Director of Green Transport development Project Mr Tran Quan Deputy Director of Green Transport development Project Mr Doan Trung Kien Deputy Director of Green Transport development Project Mrs Nguyen Thi Minh Phuong Chief Accountant Responsibilities of the Project Management Unit The Project Management Unit is responsible for preparing Financial Statements for the ended 31 A,) December 2018 which give a true and fair view of the financial position of the Project; the funds G TH received and disbursements made for the year in accordance with the accounting policies as stated in Note 2 and Note 3 of Notes to the Financial Statements and regulations under the Financing Agreement No. 5654 - VN. In preparing those financial statements, the Project Management Unit is required to: 0 Select suitable accounting policies and then apply them consistently; 0 Make judgments and estimates that are reasonable and prudent; 0 State whether applicable accounting principles have been followed, subject to any material departures disclosed and explained in the financial statements; and 0 Design and maintain an effective internal control system for compliance with regulations that may have directly and materially financial impact on the financial statements as well as for the purpose of proper preparation and presentation of the financial statements to minimize risks and frauds and also responsible for management assertions on the effectiveness of the internal control system The Project Management Unit is responsible for ensuring that proper accounting records are kept which disclose, with reasonable accuracy at any time, the financial position of the Project and to ensure that the financial statements comply with the accounting systems as described in Note 2 and Note 3 of Notes to the Financial Statements and regulations under the Financing Agreement No. 5654 - VN between the Socialist Republic of Vietnam and International Development Association (IDA) as well as laws and other provisions applicable to the Project. They are also responsible for safeguarding the assets of the Project and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 3 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT The Project Management Unit of Transportation Works Construction invEstment Project Management Authority of Ho Chi Minh City (TCIP) Financing Agreement No. 5654 - VN REPORT OF THE PROJECT MANAGEMENT UN17 (CONT'D) The Project Management Unit confirms that they have complied with the above requirements in preparing the Financial Statements. For and on behalf of the Project Management Unit, Luong Minh Phuc . Director Ho Chi Minh City, 15 May 2019 4 W VH AUDITING AND CONSULTING CO LTD No: AN /2019/ UHY - BCKT INDEPENDENT AUDITORS' REPORT On Ho Chi Minh City Green Transport Development Project For the year ended 31 December 2018 To: The Project Management Unit of Transportation Works Construction Investment Project Management Authority of Ho Chi Minh City (TCIP) The World Bank Opinion We have audited the accompanying financial statements of the Ho Chi Minh City Green Transport Development Project ("the Project"), which comprise the Statement of Financial Position as at 31 December 2018, Statement of Sources and Uses of funds, Statement of Designated account, Statement of Loan Withdrawals for the year then ended, and the Notes to the financial statements, . including a summary of significant accounting policies. In our opinion, in all material respects, the accompanying financial statements give a true and fair view of the financial position of the Project as at 31 December 2018, the funds received and expenditures incurred of the Project for the year ended 31 December 2018 in accordance with the accounting policies described in Note 2 and Note 3 of the Notes to the financial statements. Basis for Opinion We conducted our audit in accordance with International Standards on Auditing ("ISAs"). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are independent of Project Management Unit in accordance with the international Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants ("IESBA Code"), and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Emphasis of matters - Basis of Financial Reporting and Restriction of uses As stated in Note 2 of Notes to the financial statements, the financial statements are prepared in accordance with requirements of the World Bank's financial reporting, Financing Agreement No. 5654 - VN and the accounting policies stated in Note 3 of the Notes to the Financial statements. As a result, the financial statements is only used for submission to the World Bank and not be suitable for other purposes and distributed to any other parties. Our opinion is not modified in respect of this matter. Responsibilities of the Project Management Unit for the financial statements The Project Management Unit is responsible for the preparation of the financial statements in accordance with the principal accounting policies described in Notes to the Financial Statements, and for such 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. Head Office: 9th Floor, HL Tower, 82 Duy Tan Str., Cau Giay Dist., Hanoi, Vietnam Phone: 84 24.3755 7446 Fax: 84 24.375S 7448 www.uhy.vn 5 An independent member of UHY Intemational INDEPENDENT AUDITORS' REPORT (CONTINUED) Auditors' responsibility for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement 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. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: * Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. * Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Project's internal control. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Nguyen Thi Phuong Thao Trinh Thu Huong Deputy General Director Auditor Auditor's Practicing Certificate CPA Registration Certificate No. 0933-2018-112-1 No. N4195-2018-112-1 For and on behalf of UHY AUDITING AND CONSULTING COMPANY LIMITED Hanoi, 15 May 2019 6 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN STATEMENT OF SOURCES AND USES OF FUND For the ended 31 December 2018 Year 2018 Accumulated to Notes 31112/2018 VND VND 1. Funds 1 World Bank 6 628,096,531 2,130,021,270 2 SECO - 3 Counterpart fund 7 14,660,000,000 46,932,635,680 15,288,096,531 49,062,656,950 II. Expenditures 5 1 Preparation stage 120,900,000 9,318,005,634 BRT component - 8,915,005,634 SECO component 120,900,000 403,000,000 2 Component 1 14,721,117,521 37,459,608,722 Consulting services 485,730,000 2,459,307,000 Project management 14,235,162,799 35,000,000,000 Bank charges 224,722 301,722 3 Component 2 - - 4 Component SECO 5 Interest, commitment fees and service charges - 8,330,Ei96 III. Exchange rate differences 21,761,422 57,581,633 14,842,017,521 46,785,945,352 IV. Surplus (1-11+111) 467,840,432 2,334,293,231 Luong Minh Phuc Nguyen Thi Minh Phuong Director Chief Accountant Ho Chi Minh City, 15 May 2019 The accompanying notes are an integral part of the Financial Statements 7 HO CHI MINH CITY GREEN TRANSPORT DEVE'-OPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN STATEMENT OF FINANCIAL POSITION For the ended 31 December 2018 Notes 31112/2018 01/0112018 VND VND Opening fund balance 1,866,452,799 1,576,395,129 Surplus 467,840,432 290,057,670 Closing fund balance 2,334,293,231 1,866,452799 Represented by: Assets Cash at bank 8 6,291,124,114 3,952,912,396 Advance to Contractors 9 161,910,000 323,820,000 Fixed assets 176,823,000 24,795,000 Depreciation of fixed assets (25,863,265) (486,607) 6,603,993,849 4,301,040,789 Liabilities Payables to contractors 10 120,900,000 890,570,000 Payables to staff - 89,605,672 . Bonus and welfare fund 3,997,840,883 1,430,103,925 Resources Funds that form of fixed assets 150,959,735 24,308,393 4,269,700,618 2,434,587,990 Net assets 2,334,293,231 1,866,452799 UV Luong Minh Phuc Nguyen Thi Minh Phuong Director Chief Accountant Ho Chi Minh City, 15 May 2019 The accompanying notes are an integral part of the Financial Statements 8 � � � 0� Q О' 00 ��УО NOON '' tON м с- �i' Г у-рр� •0 Г г f� 0� и ММО NООN С1 и м м .-м м •�... N<- .8`О > N СОО� tD(pOt�OOf� �м t0 N �-�N ■ г �N д� � ии �лйоооло� ои � м �r м Ш�` ++N N м,и ОООГ�ОО ми 00 00 (Vорр I �`� �` о (р t0 а- О �- и N О М м Q) и N �- � N � Ш�� 7 Г О NN РиNГ�0 O�tp t� м � м ■ Q Т� � м м м�0 01 .- с0 N N о N и Q> о r� � о U � Г о С Г о(V �О СО о R� lV (V � N у�о � N �,��, �� мNм � N ймсv � g�iм а v � г. 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U .S ■ � О � О�с.� с т = -��2 х t- � t� ii ■ ■ ■ HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportatior. Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an integral part of and should be read in _;onjunction with the accompanying financial statements) 1. PROJECT BACKGROUND The Ho Chi Minh City Green Transport Development Project operates under the Financing Agreement No.5654 - VN dated 09 May 2015 signed between the Socialist Republic of Vietnam and the International Development Association (IDA). The Financing Agreement officially takes effect after 90 days from 'he signing date. The project development objective is to improve the performance and efficiency of public transport along a 'nigh priority corridor in HCMC. The Project has a- total cost of US$ 143.6 million and will be financed by an International Development Association Credit of SDR 88,200,000, equivalent to US$ 123.6 million. The project will also be co-financed by the Government of Vietnam (US$ 20 million). The International Development Association Credit will have a maturity of 25 years, including a grace period of 5 years. The IDA Credit terms also include interest of 1.25%, service charge of 0.75%, and commitment fee 0.50%. The borrower is the Government of Vietnam that will on-lend the credit to HCMC. The Project consists of two components as follows: Com2onent 1: Bus Ral2id Transportation (BRT) Corridor Developmen Development of a Bus Rapid Transit ("BRT") corridor between An Lac in the southwest of HCMC to Rach Chiec in the northwest of HCMC, including the following: a) Carrying out the construction and supervision of the BRT infrastructure and facilities; b) Improvement of the traffic management system, including the modification of intersection control and the deployment of an intelligent transport system and associated technologies; c) Development of a fare collection system, including- smart cards and servers; d) Provision of BRT vehicles and fueling facilities; e) Carrying out integrated planning and urban development measures around BRT stations; Provision of management support for BRT system implementation, including carrying out of marketing and public communication activities; g) Provision of support for Project management; and Provision of: (i) office equipment and vehicles, support for the upgrading of office facilities; and (ii) other operational support for managing implementation of the BRT system; h) Land acquisition and resettlement. Component 2: Institutional St[tnAthening a) Training programs and technical support for relevant implementing agencies in Project management, urban transport planning, and public transport operation including strategic support for the operation of the BRT system; b) Carrying out of monitoring and evaluation activities, including the assessment of the BRT system success on an on-going basis; c) Carrying out of feasibility and design studies for maximizing connectivity and ridership and continued development of the BRT system; and d) Carrying out of a study to develop the optimal fare structure and fare product range for the public transportation system. 12 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an integral part of 6:7d should be read in conjunction with the accompanying financial statements) 1. PROJECT BACKGROUND (CONTINUED) The financing ratios by each donor are as follows: Project Componunt Project Cost (USD) Government of IDA Vietnam (USD) (USD) 1. BRT Corridor 138,679,533 20,064,105 118,615,428 Development 18693200,0 18154 Construction 49,699,000 49,699,000 Equipment 21,097,300 21,097,300 Project management 3,913,600 3,913,600 - Consulting services 13,136,900 1,252,900 11,884,000 Other expenses 3,987,314 224,814 3,762,500 Land acquisition & 4,576,000 4,576,000 resettlement Provisions 35,650,294 3,477,666 32,172,628 eest commitment 6,619,125 6,619,125 fees 2. Institutional 5,000,000 5,000,000 Strengthening . TOTAL 143,679,533 20,064,105 123,615,428 SECO section Technical assistance project to HCMC Green Transport Development project financed by Swiss State Secretariat for Economic Affairs (SECO) fund entrusted to the World Bank will contribute to improve the performance and efficiency of public transport a long a high priority corridor in HCMC. The components under the SECO technical assistance project do not overlap with those under the main project. The additional components include: (i) Integrated urban development based on Transit Oriented Development (TOD) principles; (ii) Transport planning for enhanced connectivity which supports the integration of BRT with other modes of transport (iii) Capacity strengthening for TCIP in the implementation of the GTD project as well as the activities under the additional financing; and the corporate and business capacity of relevant authorities. The section will be carried out at a total cost of USD 11.46 million, of which, 10.5 million USD comes from non-refundable aid by the Swiss State Secretariat for Economic Affairs (SECO) entrusted to the WB and USD 0.96 million is counter-part fund. 13 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 Decembar 2018 Financing Ag reement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an integral part of and should be read in conjunction with the accompanying financial statei; ents) 2. BASIS OF PREPARATION AND ACCOUNTING PERIOD The financial statements are prepared in accordance with the World Bank's financial reporting requirements, the requirements of the above-mentioned Agreement and the following accounting principles. The accompanying financial statements have been prepared in Vietnam Dong ("VND"), except for the statement of designated account and the statement of loan withdrawals, which are prepared in the original currency of United States Dollars ("USD"). The financial statements are prepared under the historical cost convention and on a modified cash basis of accounting. Accordingly, receipts are recognised when received rather than when the right to receive them arises, and expenditures are recognised when incurred. Accounting period The Project's accounting period is from 1 January to 31 December. The financial statements have been prepared for the ended 31 December 2018. 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The significant accounting policies, which have been adopted by the Project Management Unit in the preparation of these financial statements, are as follows: Foreign currency translation lU hu Funds received in foreign currency are translated into VND at the exchange rate Af announced by the Ministry of Finance of Vietnam. *9 Expenses arising in foreign currencies are translated into VND at the exchange rate announced by the Ministry of Finance of Vietnam at the date of acceptance minutes. Payments in foreign currencies are translated into VND at the buying exchange rate of the service bank at the transaction date. Balances of monetary assets and liabilities denominated in foreign currencies at the year- end are translated at the exchange rate announced by the Ministry of Finance Vietnam. Foreign exchange difference is not a receiptlexpenditure. However, cash-related foreign exchange difference is presented in a separate line in the Statement of Resources and Uses of Funds for the purpose of reconciliation between opening fund balance and closing fund balance. 14 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an integral part of and should be read in conjunction with the accompinying financial statements) 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 3.1 Recognition of funds Funds received from the Donors are recorded when remittance made into Designated Accounts or direct payment made to the contractors/suppliers. Counterpart funds of the Vietnamese Government are recorded when payments are made directly from the Vietnamese Government to contractors/ suppliers of the Project or funds are remitted to the PMU for settlement of project's activities. 3.2 Recognition of expenditures Expenditures are recognized when they are actually incurred and approved by the PMU; General administration expenses are allocated among sub-projects implemented by TCIP. Expenses cannot be separated from each project, allocated according to the percentage corresponding to the number of staff participating in each project. Commitment fee of IDA loan: Maximum commitment fee of IDA loan is equal to 0.5% per year on the undrawn fund balance. Service charge of IDA loan: is calculated based on the rate of 0.75% on the drawn amounts. ,N Interest: Interest of IDA loan is calculated based on the drawn balance at the rate of 1.25% T per year. C IA Commitment fee, service charge interest charge of IDA loan are recognised as an expense of the Project annually in accordance to announcement of World Bank. 4. DESIGNATED ACCOUNT Designated account is a deposit account maintained at the commercial bank for purpose of the Project's activities. Payments made via Designated Account are for eligible expenditures of the Project in accordance with the provisions of the Financing Agreement No. 5654-VN dated 09 May 2015. The Designated Account for Financing Agreement No. 5654-VN is a USD deposit account maintained at Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) for the Project's activities. Payments from the Designated Account are made in accordance with related covenants of Financing Agreement No. 5654-VN and relevant regulations of the World Bank. 15 EE W M gagEUgagagUEEgEEagaE gUEM HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction Investment Project Management Authority of Ho Chi For the year ended Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an integral part of and should be read in conjunction with the accompanying financial statements) 5. EXPENTDITURES Year 2018 Accumulated to 31/12/2018 Categories IDA fund SECO fund Counterpart fund Total IDA fund SECO fund Counterpart fund Total VND VND VND VND VND VND VND VND Preparation stage - 120,900,000 - 120,900,000 - 120,900,000 9,197,105,634 9,318,005,634 BRT component - - - 8,915,005,634 8,915,005,634 SECO component - 120,900,000 - 120,900,000 - 120,900,000 282,100,000 403,000,000 Component 1 485,954,722 - 14,235,162,799 14,721,117,521 1,432,688,722 - 36,026,920,000 37,459,608,722 Consulting services 485,730,000 - - 485,730,000 1,432,387,000 - 1,026,920,000 2,459,307,000 Project management - - 14,235,162,799 14,235,162,799 - - 35,000,000,000 35,000,000,000 Bank charges 224,722 - 224,722 301,722 - 301,722 Component 2 - - - - Interest, - - - - 8,330,996 8,330,996 commitment fees, IDA - - 8,330,996 8,330,996 485,954,722 120,900,000 14,235,162,799 14,842,017,521 1,432,688,722 120,900,000 45,232,356,630 46,785,945,352 16 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportation Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an integral part of and should be read in conjunction with the accompanying financial statements) 6. IDA FUND Accumulated to Year 2018 3111212018 Equivalent to Equivalent to USD VND USD VND IDA: Financial Agreement 5654-VN - IDA Fund 27,732.98 628,096,531 96,050.74 2,130,021,270 27,732.98 628,096,531 96,050.74 2,130,021,270 7. GOVERNMENT FUND Year2018 Year2017 VND VND Opening balance 32,272,635,680 20,418,489,634 Balance in year 14,682,455,923 11,854,146,046 Closing balance 46,955,091,603 32,272,635,680 8. CASH AT BANK 3111212018 01/0112018 USD Equivalent to Equivalent to N VND VND Cash at the State Treasury - 5,697,840,883 - 2,965,266,724 Cash at Joint Stock Commercial - - - 89,605,672 Bank for Investment and Development of Vietnam (BIDV) Designated account - IDA (Joint 26,101.33 593,283,231 40,000.00 898,040,000 Stock Commercial Bank for Foreign Trade of Vietnam) 26,101.33 6,291,124,114 40,000.00 3,952,912,396 9. ADVANCES TO CONTRACTORS 3111212018 01/0112018 VND VND - Joint venture of UHY Auditing & Consulting Ltd. and Nexia 161,910,000 323,820,000 STT Ltd. 161,910,000 323,820,000 17 HO CHI MINH CITY GREEN TRANSPORT DEVELOPMENT PROJECT FINANCIAL STATEMENTS The Project Management Unit of Transportat;on Works Construction For the year ended Investment Project Management Authority of Ho Chi Minh City (TCIP) 31 December 2018 Financing Agreement No. 5654 - VN NOTES TO THE FINANCIAL STATEMENTS (The notes are an iniegral part of and should be read in conjunction with the accompanying financial statements) * 10. PAYABLES TO CONTRACTORS U. 3111212018 01/0112018 VND VND - Ms. Nguyen Thi Thuy Nga (consulting cost) - 306,750,000 - Joint venture of UHY Auditing & Consulting Ltd. and Nexia - 323,820,000 STT Ltd. - Thang Long Construction Consulting Company Limited - 260,000,000 - Vietnam Consulting and Technology Company Limited 120,900,000 - 120,900,000 890,570,000 11. COMPARATIVE FIGURES The comparative figures are from those in the audited financial statements for the year ended 31 December 2017 of the Project. Luong Mlifr Phuc Nguyen Thi Minh Phuong Director Chief Accountant Ho Chi Minh, 15 May 2019 18 U U PATI AUIOR'RPART ONTH * INTERNAL CONTROL OVER PREPARATION OF THE FINANCIAL STATEMENTS U. U U1 U U AUDITING AND CONSULTING CO LTD AUDITORS' REPORT ON THE INTERNAL CONTROL OVER PREPARATION OF THE FINANCIAL STATEMENTS To: The Project Management Unit of Transportation Works Construction Investment Project Management Authority of Ho Chi Minh City (TCIP) The World Bank We have audited the financial statements of the Ho Chi Minh City Green Transport Development Project - Financing Agreement No. 5654 -VN implemented by TCIP ("the Project") for the ended 31 December 2018 in accordance with International Standards on Auditing and issued Independent Auditors' Report dated 15 May 2019 with unqualified opinion. In connection with our audit of the Project's Financial statements, we also examined the effectiveness of internal control over compliance with requirements that could have a direct and material financial Implications on the Financial statements as well as of internal control over financial reporting. The Project Management Unit is responsible for designing and maintaining effective internal control ove* compliance with requirements that could have a direct and material financial implications on the Financial statements as well as over financial reporting for the purpose of properly preparing and presenting the Financial statements so as to minimize errors and frauds, and take responsibility for its assertion as to the effectiveness of such internal control. Our responsibility is to express an opinion on the effectiveness of internal control over compliance with requirements that could have direct and ' material financial Implications on the Financial statements as well as internal control over financial reporting based on our examination. Our examination was conducted in accordance with International Standard on Assurance Engagements (ISAE) 3000. That standard requires that we comply with Quality Control Standard No. 1, ethical requirements and plan and perform our procedures to obtain reasonable assurance about whether, in all material respects, the Project Management Unit has maintained effective internal control over compliance with requirements that could have a direct and material financial effect on the financial statements as well as internal control over financial reporting. We apply International Standard on Quality Control I and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior. We also conduct other audit procedures that we found necessary in each circumstance in order to obtain sufficient evidence as a basis for expressing our opinion. We believe that our examination has provided a reasonable basis for our opinion. Because of inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not to be prevented or detected on a regular basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting 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 or procedures may deteriorate. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Head Office: 9th Floor, HL Tower, 82 Duy Tan Str., Cau Giay Dist., Hanoi, Vietnam 20 Phone: 84 24.3755 7446 Fax: 84 24.3755 7448 www.uhy.vn A rindependent member of UHY Intemational AUDITORS' REPORT ON THE INTERNAL CONTROL OVER PREPARATION OF THE FINANCIAL STATEMENTS (CONTINUED) In our opinion, the Project Management Unit has maintained, in all material respects, effective internal control over compliance with requirements that could have direct and material financial implications on the financial reporting as well as the internal control over the Project's financial reporting for the ended 31 December 2018. Other Matters This audit involved a historical evaluation of internal control at a specific point of time. Thus, this audit does not provide assurance for future periods due to the risk that internal control may become inappropriate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate. Nguyen ThiPhuong Thao Trinh Thu Huong Deputy General Director Auditor Auditor's Practicing Certificate CPA Registration Certificate No. 0933-2018-112-1 No. N4195-2018-112-1 For and on behalf of ' UHY AUDITING AND CONSULTING COMPANY LIMITED Hanoi, 15 May 2019 2 PART Ilil AUDITORS' REPORT ON THE COMPLIANCE * 2UA 22 U. VH AUDITING AND CONSULTING CO LTD U AUDITORS' REPORT ON THE COMPLIANCE To: The Project Management Unit of Transportation Works Construction Investment Project Management Authority of Ho Chi Minh City (TCIP) The World Bank We have audited the financial statements of the Ho Chi Minh City Green Transport Development Project - Financing Agreement No. 5654 -VN implemented by TCIP ("the Project") for the ended 31 December 2018 in accordance with International Standards on Auditing and issued Independent Auditors' Report dated 15 May 2019 with unqualified opinion. In connection with the audit of the Financial statements, we also performed procedures on the . Project's compliance with Financing Agreement No. 5654 - VN and regulations that could have a direct and material financial Implications on the Project's Financial statements for the ended 31 December 2018 (hereinafter referred to as "Requirements"). The Project Management Unit is responsible for complying with Financing Agreement No. 5654 - VN, laws and regulations applicable to the Project. Our responsibility is to express an opinion on the Project's compliance with the Requirements based on our procedures. We limited our tests of compliance to the Requirements, rather than test of compliance with all laws and regulations applicable to the Project. We performed our work in accordance with International Standard on Assurance Engagements (ISAE) 3000. That standard requires that we comply with Quality Control Standard No. 1, ethical requirements and plan and perform our procedures to obtain reasonable assurance about whether, in all material respects, the Project has complied with the regulations. We apply International Standard on Quality Control 1 and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior. An assurance engagement to report on the compliance with the requirements at the Project involves performing procedures to obtain evidence about whether the Project's activities are free of material noncompliance with the requirements, including obtaining an understanding of the internal control relevant to the Project's compliance with the requirements, The procedures selected depend on the auditor's judgment, including the assessment of risk that the Project does not comply with the requirements and whether such noncompliance could have a direct and material financial effect on the Project's financial statements, Our procedures included testing the compliance with the requirements that we consider necessary to provide reasonable assurance that the requirements are complied by the Project. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Head Office: 9th Floor, HL Tower, 82 Duy Tan Str., Cau Giay Dist., Hanoi, Vietnam Phone: 84 24.3755 7446 Fax: 84 24.3755 7448 23 www,uhy.vn An independent member of UHY International AUDITORS' REPORT ON THE COMPLIANCE (CONTINUED) In our opinion, the Project was, in all material respects, in compliance with Financing Agreement No. 5654 - VN, and regulations that could have a direct and material financial effect on the Project's Financial Statements for the ended 31 December 2018. Other Matters This examination involved a historical evaluation of the compliance of the PPCO with the Project's regulations at a specific point of the time. Thus, this examination does not provide assurance for future periods due to the risk of changes in the Project's regulations, or that the degree of compliance with the Project's regulations, may deteriorate. Nguyen ThiPhuong Thao Trinh Thu Huong Depty General Director Auditor Auditor's Practicing Certificate CPA Registration Certificate No. 0933-2018-112-1 No. N4195-2018-112-1 For and on behalf of UHY AUDITING AND CONSULTING COMPANY LIMITED Hanoi, 15 May 2019 W 24 U