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Audited Financial Statements Natural Resources The International Potato Center (known by its Spanish acronym CIP) is a research-for-development organization with a focus on potato, sweetpotato, and Andean roots and tubers. CIP is dedicated to delivering sustainable science-based solutions to the pressing world issues of hunger, poverty, gender equity, climate A member of the change and the preservation of our Earth’s fragile biodiversity and CGIAR Consortium Audited Financial Statements natural resources. www.cipotato.org and Complementary Information CIP is a member of CGIAR. For the year ended December 31, 2014 CGIAR is a global agriculture research partnership for a food-secure future. Its science is carried out by the 15 research centers who are A member of the members of the CGIAR Consortium in collaboration with hundreds CGIAR Consortium of partner organizations. www.cgiar.org Financial Statements For the year ended 31 December 2014 CENTER POTATO INTERNATIONAL International Potato Center Audited Financial Statements December 31, 2014 International Potato Center for year ending December 31, 2014 and 2013 International Potato Center Audited Financial Statements December 31, 2014 The International Potato Center (known by its S anish acronym, CIP) is a research-for-develo ment organi)ation with a focus on otato, sweet otato, and Andean roots and tubers. CIP is dedicated to delivering sustainable science-based solutions to the ressing world issues of hunger, overty, gender e-uality climate change and the reservation of our .arth/s fragile biodiversity and natural resources. Our Vision is roots and tubers im roving the lives of the oor. Our Mission is to work with artners to achieve food security, well-being, and gender e-uity for oor eo le in root and tuber farming and food systems in the develo ing world. 0e do this through research and innovation in science, technology, and ca acity strengthening. CGIAR Consortium is an international organi)ation that, together with the C1IA2 3und, advances international agricultural research for a food secure future by integrating and coordinating the efforts of those who fund research and those who do the research. CIP is a member of the Consortium of International Agricultural 2esearch Centers and receives its rinci al funding from the members of the C1IA2 3und. CGIAR Research is dedicated to reducing rural overty, increasing food security, im roving human health and nutrition, and ensuring more sustainable management of natural resources. It is carried out by 15 Centers that are members of the C1IA2 Consortium in close collaboration with hundreds of artner organi)ations, including national and regional research institutes, civil society organi)ations, academia, and the rivate sector. The 15 2esearch Centers generate and disseminate knowledge, technologies, and olices for agricultural develo ment through the C1IA2 2esearch Programs. The C1IA2 3und rovides reliable and redictable multi-year funding to enable research lanning over the long term, resource allocation based on agreed riorities, and the timely and redictable disbursement of funds. The multi-donor trust fund finances research carried out by the Centers through the C1IA2 2esearch Programs. International Potato Center Audited Financial Statements December 31, 2014 Table of Contents Statement by the Board Chair 1-2 Management Report 3 Statement on Risk Management 4 Board of Trustees Members 2014 5 Independent Auditor’s Report 6-7 Statement of Financial Position 8 Statement of Activities 9 Statement on Changes in Net Assets 10 Statement of Cash Flow 11 Notes to the Financial Statements 12-20 Statement of Grant Revenue – Exhibit 1 21-22 Restricted Grant Revenue – Exhibit 2 23-27 Property, Plant and Equipment – Exhibit 3 28 Property, Plant and Equipment - Unrestricted – Exhibit 3 (a) 29 Pro erty, Plant and .-ui ment : 2estricted : Exhibit 3 (b) 30 Schedule of Direct and Indirect Cost Rates – Exhibit 4 31 CGIAR Research Program Expenditure Report – Exhibit 5 32-40 International Potato Center Audited Financial Statements December 31, 2014 Statement by the Board Chair The International Potato Center/s Board of Trustees remains firm in its commitment to rovide rogrammatic, governance, and financial oversight and leadershi to ensure that the Center is managed effectively and efficiently. The Board is rivileged to serve an organi)ation that is working with artners to achieve food security, well-being, and gender e-uity for oor eo le in root and tuber farming and food systems in the develo ment world. Center Highlights The International Potato Center (CIP) has seen steady rogrammatic and financial growth over the last cou le of years and 2014 continued this trend. The highlight of the year was continuing the lead in im lementing the C1IA2 2esearch Program on 2oots, Tubers and Bananas. CIP is the lead artner in this exciting research rogram and is joined by three other C1IA2 artner centers: International Center for Tro ical Agriculture (CIAT), International Institute for Tro ical Agriculture (IITA), and Bioversity International, lus The Agricultural 2esearch for Develo ment center (CI2AD). CIP is also working in a total of 7 other C1IA2 2esearch Programs (C2P) including; C2P on Agriculture for Nutrition and Aealth, C2P on Managing and Sustaining Cro Systems, C2P on Climate Change, Agriculture, and 3ood Security, C2P on Dryland Systems, C2P on Integrated System for the Aumid Tro ics, C2P on Policies and Institutions and Markets, and C2P on 0ater, Cand D .cosystems. These C1IA2 2esearch Programs also allow CIP to ex and its research rograms to continue laying an im ortant role in im roving otato and sweet otato roduction systems and the livelihoods of millions of eo le around the world. Financial Performance The Center was successful in achieving an o erating sur lus of ESF1.8M in 2014 and was successful in achieving revenue of ESF72.4M during 2014 a year over year increase of ESF4.3M or an increase of 6G. This increase in revenue for 2014 was mainly due to the increase in donors contributions to 0indow 3 (contributions allocated by 3und donors to s ecific C1IA2 Centers). The short-term solvency indicator (li-uidity), which measures the number of days of working ca ital to fund ex enditures excluding de reciation, was 111 days as of December 31, 2014. 0hile the long-term financial stability indicator (ade-uacy of reserves), which measures the number of days of unrestricted net assets, was 92 days. The indirect cost ratio of the Center was 15.1G for 2014. The ratio has been calculated following the 3inancial 1uidelines No. 5, and ex resses the relation between direct and indirect costs. CIP/s financial indicators reflect that the Center is maintaining its financial health, though no institution is immune to financial or o erational risk. To mitigate risk, the Board/s Audit Committee ensures oversight of CIP/s risk management olicies and lans. In a much broader sense, the Board oversees Center o erations in the interest of donors and stakeholders. CGIAR Change Management In 2014, the Consortium continues to work to strengthen the links between outcomes and im act with the individual C1IA2 2esearch Programs. The Consortium is utting into lace a lan to directly link erformance and accountability to the future funding of the C1IA2 2esearch Programs. These changes along with others will lead to more collaboration and less overla among C1IA2 Centers. 1 International Potato Center Audited Financial Statements December 31, 2014 Appreciation I would like to ex ress my gratitude and a reciation to Dr. Stella 0illiams and Dr. Peter HanderIaag who served with dedication and high standards during their tenure as a Board member. I would also like to welcome the four new Board members Mr. Jim .ckles from The Enited States of America, Dr. 3rannie CKautier who has dual nationality : Tan)ania and 3rance, Dr. Cinley Chiwona-Larltun who has dual nationality : Malawi and Sweden and Dr. Alberto Maurer who has dual nationality : Peru and Italy. On behalf of the Board, I would like to thank CIP/s donors, investors, and all C1IA2 artners for their su ort. I also extend my a reciation to CIP/s management and staff for their continued dedication to the organi)ation and its im ortant mission. March 30, 2015 Dr. 2odney Cooke Chair, Board of Trustees 2 International Potato Center Audited Financial Statements December 31, 2014 Management Report To the Board of Trustees: The 2014 3inancial Statements ex ressed in ES dollars have been re ared in accordance with the accounting olicies of the Consultative 1rou on International Agricultural 2esearch (C1IA2) 3inancial 1uidelines No. 2 : Accounting Policies and 2e orting Practices Manual. CIP management is res onsible for the reliability of the financial statements and is of the o inion that they give a true and fair view of the state of the financial affairs of the Center and of its o erating results. The Center maintains an internal control system over its financial re orting, which is designed to rovide reasonable assurance to management and the Board of Trustees that the financial statements rovide reliable information. The systems of internal controls include established olicies and rocedures communicated and a lied throughout the Center. The Board of Trustees, o erating through its Audit and 2isk Oversight Committee, rovides oversight of the financial re orting rocess and of the safeguards in the system of internal control to avoid unauthori)ed ac-uisition, use or dis osal of assets. The Audit and 2isk Oversight Committee, meets rivately with external auditors to discuss the results of their work, the ade-uacy of the internal control system and the -uality of financial re orting. .very year, the Audit Committee recommends to the Board the a ointment of an external audit firm, and the terms of reference for their work. The external audit for 2014 was erformed by .rnst D Noung.
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