W W Deloitte W
W
WPublic Disclosure Authorized U W U U W U
UPublic Disclosure Authorized
CENTRAL HIGHLANDS POVERTY REDUCTION PROJECT - GIA LAI PROVINCE
Financing Agreement - Credit number Cr. 5330-VN
AUDITED FINANCIAL STATEMENTS, ASSURANCE REPORTS AND MANAGEMENT LETTER
Public Disclosure Authorized For the year ended 31 December 2018 Public Disclosure Authorized CENTRAL HIGHLANDS POVERTY REDUCTION PROJECT - GIA LAI PROVINCE Financing Agreement - Credit number Cr. 5330-VN
TABLE OF CONTENTS
CONTENTS PAGE(S)
PART I FINANCIAL STATEMENTS
Statement of the Project Management Unit 2
Independent Auditors' Report 3 4
Balance Sheet 5
Statement of Incomes and Expenditures 6
Statement of Sources and Uses of Funds 7
Statement of Designated Account 8
Statement of Withdrawals 9
Notes to the financial statements 10 - 12
INDEPENDENT AUDITORS' ASSURANCE REPORT ON PART II INTERNAL CONTROL 13-14
PART III INDEPENDENT AUDITORS' ASSURANCE REPORT ON COMPLIANCE Statement of the Project Management Unit on Compliance 15 Independent Auditors' Assurance Report on Compliance 16 - 17
PART IV MANAGEMENT LETTER 18 - 24 . , . . � . . � . . . . PARTI . 、⋯ .FINANCIALSTATE 間ENTS 日 個 .- . . . 發 . 〞
.- . 珍- ...... 目 . . � . � CENTRAL HIGHLANDS POVERTY REDUCTION PROJECT - GIA LAI PROVINCE Financing Agreement - Credit number Cr. 5330-VN
STATEMENT OF THE PROJECT MANAGEMENT UNIT
The Project Management Unit of the Central Highlands Poverty Reduction Project - Gia Lai Province (the "Project Management Unit") presents this report together with the financial statements of the Central Highlands Poverty Reduction Project - Gia Lai Province (the "Project") for the year ended 31 December 2018.
The Project Management Unit
The members of the Project Management Unit who held office during the year and to the date of this report are as follows:
Mr. Ho Phuoc Thanh Director
Mr. Le Quang Dat Deputy Director
Ms. Truong Thi Nhung Chief Accountant
The Proiect Management Unit's Statement of Resl2onsibility
The Project Management Unit is responsible for preparing the financial statements of the Project, which comprise the Balance Sheet as at 31 December 2018, the Statement of Incomes and Expenditures, Statement of Sources and Uses of Funds, Statement of Designated Account, Statement of Withdrawals for the year then ended and the Notes to the financial statements including a summary of significant accounting policies, which give a true and fair view of the financial position of the Project and designated account balances as at 31 December 2018 as well as of the incomes and expenditures, the receipts and disbursements of the Project, designated account movements and fund withdrawals for the year then ended, in accordance with the accounting convention and the accounting policies set out in Note 2 and Note 3 of the Notes to the financial statements and the covenants contained in Financing Agreement - Credit number Cr. 5330-VN. In preparing these 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; a State whether applicable accounting principles have been followed, subject to any material departures disclosed and explained in the financial statements; 0 Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Project will continue in business; and 0 Design and maintain effective internal control over compliance with requirements that could have a direct and material financial effect on the financial statements as well as over financial reporting for the purpose of properly preparing and presenting the financial statements so as to mininnise errors and frauds; and take responsibility for its assertions as to the effectiveness of such internal control.
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 that the financial statements comply with the accounting convention and the accounting policies set out in Note 2 and Note 3 of the Notes to the financial statements. The Project Management Unit is responsible for ensuring that the funds have been used as intended for the Project and for complying with Financing Agreement Credit number Cr. 5330-VN as well as laws and regulations applicable to the Project. The Project Management Unit is also responsible for safeguarding the assets of the Project and hence for taking reasonable steps for the prevention and detection of frauds and other irregularities.
The Project Management Unit confirms that they have complied with the above requirements in pr financial statements.
the Pr ct Management Unit,
fib Pll- 7aetljail'h D ,ire-ctQE-----
Gia Lai, 18 lune 2019
2 Deloitte Vietnam Company Ltd. 15rFloor, Vinaconex Tower, SD elonitte 34 Lang Ha Street, Lang Ha Ward, Dong Da District, Hanoi, Vietnam Tel :+84 24 6288 3568 Fax:+84 24 6288 5678 No.:642 /VN1A-HN-BC Website: www.deloitte.corn/vn
INDEPENDENT AUDITORS' REPORT
To: The Project Management Unit of the Central Highlands Poverty Reduction Project - Gia Lai Province
Opinion
We have audited the financial statements of the Central Highlands Poverty Reduction Project - Gia Lai Province (the "Project") prepared on 18 June 2019, as set out from page 05 to page 12, which comprise the Balance Sheet as at 31 December 2018, Statement of Incomes and Expenditures, Statement of Sources and Uses of Funds, Statement of Designated Account, Statement of Withdrawals for the year then ended, and the Notes to the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Project and designated account balances as at 31 December 2018 as well as of the incomes and expenditures, the receipts and disbursements of the Project, designated account movements and fund withdrawals for the year then ended, in accordance with the accounting convention and the accounting policies set out 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 the Project in accordance with the ethical requirements that are relevant to our audit of the financial statements, 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 Matter - Basis of Accounting
We draw attention to Note 2 and Note 3 of the Notes to the financial statements, which describes the accounting convention and the summary of the significant accounting policies. The financial statements are prepared in accordance with the accounting convention and the accounting policies set out in Note 2 and Note 3 of the Notes to the financial statements and the requirements of the World Bank. Our opinion is not modified in respect of this matter.
Responsibilities of the Project Management Unit and those charged with governance for the Financial Statements
The Project Management Unit is responsible for the preparation of the financial statements in accordance with the accounting convention and the accounting policies set out in Note 2 and Note 3 of the Notes to the financial statements, and for such internal control as the Project Management Unit determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Central Project Coordination Office is responsible for assessing the Project's ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the Central Project Coordination Office either intends to liquidate the Project, or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Project's financial reporting process.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Ltd., a UK private company limited by guarantee ("DTTL"), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities, DTTL (also referred to as "Deloitte Global") does not provide services to clients. Please see www.deloitte.corn/about for a more detailed description of DTTL and its member firms. Deloitte
INDEPENDENT AUDITORS' REPORT (Continued)
Auditors' Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' 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 International Standards on Auditing (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.
* Conclude on the appropriateness of the Project Management Unit's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Project's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Project to cease to continue as a going concern.
* Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates, if any, and related disclosures made by the Project Management Unit.
We communicate with those charged with governance and the Project Management Unit regarding, arncng othermatters, the planned scope and timing of the audit and significant audit findings, including any signiflcant deficiencies in internal control that we identify during our audit.
Vu Du guyen Nguyen Tien Quoc Deputy General Director Auditor Audit Practising Registration Certificate Audit Practising Registration Certificate No. 0764-2018-001-1 No. 3008-2019-OO1-1
DELOITTE VIETNAM COMPANY LIMITED 18 June 2019 Hanoi, S.R. Vietnam
4 3 U
CENTRAL HIGHLANDS POVERTY REDUCTION PROJECT - GIA LAI PROVINCE FINANCIAL STATEMENTS * Financing Agreement - Credit number Cr. 5330-VN For the year ended 31/12/2018
BALANCE SHEET
As at 31 December 2018
Notes 31/12/2018 31/12/2017 VND VND ASSETS
Current assets 18,227,743,789 16,891,957,184
Cash 5 15,460,816,090 13,268,253,184 Cash on hand 387 387 Cash in bank 15,460,815,703 13,247,699,618 Cash in treasury 20,553,179
Receivables 2,766,927,699 3,623,704,000 Prepayments to suppliers 6 2,766,259,000 3,623,428,000 Other receivables 668,699 276,000
Total assets 18,227,743,789 16,891,957,184
LIABILITIES
Current liabilities 32,559,146,643 4,525,621,647 Payables to suppliers 7 32,510,946,626 4,478,986,774 Payables to employees 8,051,760 968,760 Other payables 8 40,148,257 45,666,113
Total liabilities 32,559,146,643 4,525,621,647
NET ASSETS (14,331,402,854) 12,366,335,537
Exchange differences 9,421,645,616 4,904,127,854 (Deficit)/Surplus of incomes over expenditures (23,753,048,470) 7,462,207,683
TOTAL (14,331,402,854) 12,366,335,537
oc Thanh Truong Thi Nhung Director Chief Accountant/Preparer
Gia Lai, 18 June 2019
The accompanying notes are an integral part of these financial statements
5 CENTRAL HIGHLANDS POVERTY REDUCTION PROJECT - GIA LAI PROVINCE FINANCIAL STATEMENTS Financing Agreement - Credit number Cr. 5330-VN For the year ended 31/12/2018
STATEMENT OF INCOMES AND EXPENDITURES
For the year ended 31 December 2018
Accumulated to 31 December 2018
VND VND INCOMES
IDA funds 9 183,387,655,804 469,302,244,493 Fund disbursed in cash 183,387,655,804 464,971,244,493
Fund disbursed by fixed assets - 4,331,000,000 Counterpart funds 4,724,941,827 25,249,733,216 Other funds 11,839,221 39,683,704
TOTAL INCOMES 188,124,436,852 494,591,661,413
EXPENDITURES
Part I: Village and Commune Infrastructure 90,693,063,590 196,418,913,083 Development
Part II: Sustainable Livelihoods Development 36,155,838,356 103,213,014,973
Part III: Connective Infrastructure Development, 84,344,823,925 171,215,234,622 Capacity Building, and Communications
Part IV: Project Management 8,140,604,319 47,465,922,073 Others (Bank charges) 5,362,815 31,625,132
TOTAL EXPENDITURES 219,339,693,005 518,344,709,883 trEIICT OF INCOMES OVER EXPENDITURES (31,215,256,153) (23,753,048,470)
HuPtroc Thanh Truong Thi Nhung Director Chief Accountant/Preparer
Gia Lai, 18 June 2019
The accompanying notes are an integral part of these financial statements
6 (% I 7i ® i ˼ rn¼ rn³, о³ ,-v а. о7.. ,рР ¼: Ç ÂV ³NÇ ¼¿ ¼N ,1¨ D ' ¼N ¡7 ОÇ 1 2 ¡ О V `? t о N ¿ а ,-, ¿ t er .-, ²Ã È ¸1 о È n, W N Ii -. Á р о ¸ ³ Л р ³ .1 ~! w 'S ' ' ] ¼r' Л+'' ' О . N t ? L ¨ Ä t `''-; ¸(} ³, ³'Sv оL ³ ' а 4^, rn ²V . N ; Æ _ N¸ `°-Q' ¼ =_ ¨ ' Ã о ¼ rn о ¼ 6i N » о о  1 I ' R » Л ¿ Н ', Q' r ´ rv ry ¡ + ³Ç ³Æ ra t N Ii' v ¸ , ¸ ¸ , Н II ® ¿ ¸ ¸ ` ° . i'1i О 1 lFJ V`р fV UJ( ½ +--4О Âi. i . V' ' J р I (3 Np , , е , е , , ¹
4 L iA  N Р i1'1 ¸ tD tO р р L Z ½ 09 V , , ¼ ¼ о:Í b5 7 L , v О ,...,р.- ³ "' , , -...... ¼ ...... . ' i ¼ а = N ! ³¸`´ _ Q ¹ j . t¼ ] ½ ¿ ¿¼ .а-³ . - i71 I11 I а n ev - - ¸ ¸ Á Á¿ о rv о tG' ьQ _ I U ¿i, ¼ v ° ¼ r Ç ' + .+ ...... ¸ - ¼ ³ i II , · ³ИÇ ` ³¸`³ ~ `Ç , --`" а U ¹ р ,., ~ U I Д . . ... ÃSЛ. -Uа vО ´ оQ ½4 ³ ³ ¼ ¸ È ® _'Q