I --11~/~e I f g DEC 2~ .; ,j I I I -:-: :-: :-:-:-:-:-:--: :-:-: :-:-: :-:-: :-:-:-:-:-:-:-:-:-:-:-:-:-:-:-: :-:-:-:-:-:-:-:- I EXTERNAL FINANCIAL AUDIT REPORTON THE GREAT LAKES - DISPLACED PERSONS AND BORDER COMMUNITIES PROJECT FINANCIAL STATEMENTS (PFS) I Period: From July 1, 2018 to June 30, 2019 I (Final) -:-: :-:-:-: :-:-:-:--:-:-:-:-:-:-:-:-:-:-: :-:-: :-:-:-:-:-:-:-:-:-:-:-:-:-:-: :-:-:-:- I I GRANT NUMBER IDA D230 I I INTERNATIONAL CONFERENCE ON GREAT LAKES REGION (ICGLR) THE GREAT LAKES DISPLACED PERSONS AND BORDER COMMUNITIES PROJECT I -.......... . - .. - .. - - - - - 38, Boulevard du Japon, BP 7076 Bujumbura Tel: +257 22 25 68 24/5/7/9 Fax: (00257) 22 25 68 28 I Email : secretariat@icglr.org I I I I D ecember 2019 I ~FIMA I f/UI q)IC-·88111 r; OH/1 /I JI Oo! l4 fm·OJJltJIJI Xi 1f c,,~...,.,_ I I I 23 Great Lakes - Displaced Persons and Border Communities Project - Grant Numher /DA D.::.. 0 :;.;:~--- I CONTENTS THE INDEPENDENT AUDITORS REPORT ON THE FINANCIAL STA TEMENTS ................... 3 I BALANCE SHEET FOR THE YEAR ENDED JUNE 30, 2019 ......................................................... 5 RESOURCES AND EXPENDITURES STATEMENT FOR THE YEAR ENDED JUNE 30, 2019 ............... 6 I J. Overview of the project ....................................................................................................................... 7 1.1 Project Background .......... ................................ ....... ......................... ................................. 7 I 1.2 Beneficiaries ... .... ............................. ............................................. ...... ............................... 7 1.3 Project's components .................. .. .............................................. ... .................................... 8 1.4 Project's Budget ............. .......... ....... ......................... ......... ...... ............................... ......... 10 I 2. Notes to the financial statements as at June 30, 2019 ...............................................................•.... 11 2.1. Accounting policies and methods ........ ... ..... .... ......... .................................. .. ................... 11 I 2.2. Comments on the balance sheet ....... .................... ........................................................... 12 3. Statement of Fund Reimbursement Request/or the year ended June 2019 .................................. 13 I 4. Reconciliation of the Designated A ccount f or the year ended June 2019 ..................................... 14 4. 1. Statement of reconciliation of the IDA Designated Account USO ................................... 14 I 4.2. Commentary notes on the statement of reconciliation of the Designated Account.. ......... 15 APPENDIX........................................................................................................................................... 16 I FINANCIALS STATEMENTS............................................................................................................ 17 MANAGEMENT REPRESENTATION LETTER ............................................................................. 22 I I I I I I I I I External Audit Report of Project Financial Statements - Period: From Ju(v I. 2018 to June 30. 2019 2 I COFIMA A1,;dtt r ..p.-nu,- compl.tl.ole Con~.:-th I To The Project Coordin ator Displaced Persons and Border Communities Project BP 7076 Bujumbura - Burundi I THE INDEPENDENT AUDITORS REPORT ON THE FINANCIAL STATEMENTS I Opinion I We have audited the financial statements of the Great Lakes - Displaced Persons and Border Communities Project financed by the IDA, for the period from July 1, 2018 to June 30, 2019. These financial statements comprise: the Balance Sheet, Resources and expenditures I statements, Statement of Expenditures (SOE), the Statement of Reconciliation of the Designated Account and notes containing the main accounting policies and other explanatory notes. I In our opinion: I the financial statements audited by us present tmly and fairly in all material respects, the financial position of the Project as at June 30, 2019, and the results of its financial activities for the year then ended; I the Statements of Expenditures (SOE) have been prepared in accordance with the Financing Agreement expenses contained therein fall entirely within the objectives of I the Project and were sufficiently supported by appropriate supporting documents; the Designated Account has not funded any ineligible expenditures and the statement of reconciliation is sufficiently reliable to justify their balances as at June 30, 2019. I Basis for Opinion I We conducted our audit in accordance with International Standards on Auditing ISA issued by the International Federation of Accountants (IF AC). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the financial statements I section of our report. We are independent of the Project within the meaning of the ethical requirements that arc relevant to our audit of the financial statements in Burundi, and we have I 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 opm1on. I In performing our audit, we placed a particular emphasis on the concerns expressed in the terms of reference of the engagement, including the implementation of procedures allowing I us to ensure that: I External Audit Report of Project Financial Statements - Period: From July 1, 2018 to June 30. 2019 3 I I be Great Lakes - Displaced Persons and Border Communities Project Grant JDA Num.,;_'- r....:. D _ 30 2-'-.:.....__ __ I the Designated account is managed in relation to the provisions of funding agreements and that internal control procedures over their utilization are reliable; the Expenditures paid through the Designated Account and in respect of which I withdrawal applications were prepared and submitted to lD Aare supported by sufficient and appropriate supporting documents. I Responsibilities of Management and those charged with Governance for the Financial Statements I The Project Coordination Unit (PCU) is responsible for the preparation and fair presentation of the financial statements. This responsibility includes: designing, implementing and maintaining I internal control procedures relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or errors, as well as the determination of reasonable accounting estimates. Our responsibility is to express an I opinion on these financial statements based on our audit. I Auditor's Responsibilities Our objectives are to obtain reasonable assurance about whether the financial statements as a I 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, I 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 I influence the economic decisions of users taken on the basis of these financial statements. Cotonou, December 4, 2019 I I I Chartered Accountant " Managing Partner I I I I I External Audit Report of Project Financial Stateme111s - Period: From July I. 2018 to June 30. 2019 4 I I Great Lakes - Displaced Persons and Border Communities Project Grant /DA Number D230 BALANCE SHEET FOR THE YEAR ENDED JUNE 30, 2019 I I Current assets Cash and cash equivalents 285 776 271792 I Cash in Transit to LM Center Sub total 1 285 776 4 825 276 617 I Non-current assets Sub-total I Total Assets 285 776 276 617 I I Current liabilities Payables Sub-total I Total current liabilities NET ASSETS/EQUITY Capital contributed by Accumulated Surplus/ (Deficit) 285 776 276 617 Total Net Assets/Equity 285 776 276 617 I Total liabilities 285 776 276 617 The notes form an integral part of these financial statements. External Audit Report of Project Financial Statements - Period: From Ju~v /, 2018 to June 30, 2019 5 I I Great Lakes Displaced Persons and Border Communities P!!3i!.c1 Grant IDA Number D230 RESOURCES AND EXPENDITURES STATEMENT FOR THE YEAR ENDED JUNE 30, 2019 I 2018 Financial 2019 Finandal RESOURCES Notes I Opening cash balance - vortuSD) - year(USD) 285 776 IDA funds received 2 300000 241536 I Other income .__ 300 000 - 527 312 TOTAL RESOURCES ..____ I EXPENDITURES - Notes 2018 Financial vear lUSD) 2019 Financial year(USD) - I Programme expenses Component 1 :Regional Learning - 68 773 I Total Sub component 1 :Regional Learning and Capacity Building - 68 773 Sub component 2 : Regional Research - - I Total Sub component 2 :Regional Resarch - - - I Sub component 3: Project Management and Institutional Capacity Building Operating expenses Staff expenses 14193 145 803 I Office Equipment Bujumbura & Independent Audit Office Running Costs Lusaka Office Expenses 0 31 0 11 850 12249 12 021 I Total Component 3 Project Management and Institutional Capacity Building Total expenses 14 224 14224 181922 250 695 I Surplus of resources over expenditures 285 776 276 617 TOTAL EXPENDITURES 300 000 527 312 - I I I I I I I Extemal Audit Reporl of Project Financial Statements - Period: From July I, 2018 to June 30, 2019 6 I I I ------ Great Lakes - Displaced Persons and Border Communities Project Grant /DA Number D230 1. Overview of the project 1.1 Proj ect Background The ICGLR is an intergovernmental organization of I 2 Member States that have ratified a pact with JO protocols on security and development in the GLR. The Conference Secretariat (ICGLR CS) will play a critical convening role, supporting regional knowledge sharing and regional I research. The CS , based in Bujumbura, is headed by Executive Secretary and assisted by program officers whose mandate is to act as the technical arm of the ICGLR. The CS is in charge of coordinating, facilitating, promoting, and monitoring the implementation of the Pact I decisions of the Summit and other initiatives to attain sustainable peace, security, stability and development in the GLR. I The Levy Mwanawasa Regional Centre (LM Center) for Democracy, Good Governance, Human Rights and Civic Education is a regional Think Tank created by the Heads of State and I Government of Member States of the International Conference on the Great Lakes Region (ICGLR) in December 2006 as a key institution for the promotion of Democracy, Good Governance, Human Rights and Civic Education. The LM Centre is a Lusaka-based I decentralized organ of the Executive Secretariat of the ICGLR Secretariat. The Great Lakes Displaced Persons and Border Communities Project is a World Bank I (WB)-funded initiative that aims to support regional learning on development responses to forced displacement. The Project Development Objective-level results indicators are: I • Perceived usefulness (percentage) of the events; • Use of the knowledge (percentage) shared at the events; I • Use of research (percentage) outputs. The intermediate indicators are: I • Regional learning platfom1s held (number) to facilitate knowledge exchange on development responses to forced displacement; I • Generation and documentation (number) of research and data focused on forced displacement in the GLR. I 1.2 Beneficiaries Direct project beneficiaries of the regional grant include the ICGLR as an institution, as well as its Member States (MS), specifically Government representatives from the six countries I considered as the Great Lakes Initiative under this SOP (namely, the Democratic Republic of Congo, Burundi, Rwanda, Uganda, Tanzania, and Zambia). Furthermore, since there are important implications and lessons for the wider ICGLR membership-who are themselves I refugees and !DP-hosting countries - these MSs will be included in events whenever feas ible, so that they can also benefit from lessons learnt and research conducted. The ICGLR will I benefit from the strengthening of its institutional capacity to play a critical convening and technical support role, supporting regional knowledge sharing and advocacy efforts for development responses to forced displacement. The LMR Centre (Levy Mwanawasa Regional I Centre for Democracy and Good Governance) will benefit from increased capacity to undertake research on the development dimensions of forced displacement. The Government I Extemal Audit Report of Project Finan cial Statements - Period: From July I, 20 I 8 10 June 30, 2019 7 I I I _ _ _ _G =--1 -'- ·ea' -t_La_ _ kes - Displaced Persons cind Border Communities Project Grant IDA Number D230 I representatives involved in displacement policy and programming will directly benefit from regional learning in the form of workshops, conferences and so on; in-depth research that seeks to fill knowledge gaps; and the generation of data which may influence policy formulation. I These officials will in tum influence a wider set of stakeholders, particularly MSs. The MSs will primarily benefit from enhanced regional cooperation and coordination, lessons emerging under the other phases of the SOP in the Democratic Republic of Congo and Zambia, and I lessons from other development responses in the GLR. Indirect project beneficiaries will include displacement-affected populations in the GLR because the availability of reliable and I up-to-date data on forced displacement as well as shared lessons will enable governments to devise appropriate responses to the plight of persons affected by displacement. I 1.3 Project's components The support to the ICGLR under the project will be captured under the follow ing three components: ( I) Regional Leaming, (2) Regional Research , and (3) Project Management and I Institutional Capacity Building, with an emphasis on activities that benefit the identified JCGLR members and further extends the benefits of knowledge sharing to the indirect beneficiaries I from Government of the six MSs not directly covered by the project (that is, displacement- affected populations in the GLR). I • Component 1: Regional Learning, US$7 17,000 ./ Subcomponent la: Regional Leaming Events, US$627,000 I The project will support the ICGLR to organize regional learning events that bring together the ICGLR MSs and other relevant stakeholders-such as the AU, I UN, and civil society- to share knowledge, experiences, and good practices regarding development responses to forced displacement. ln line with this, the ICGLR wi ll convene regional learning events based on the provisional list that was agreed on at the Local Integration as a Solution to Displacement in the GLR: I Challenges and Opportunities Workshop in Nairobi, in June 2016, and later reviewed and substantiated during preparation missions. The typology of the learning events will range from small ' closed-door' workshops to enable I Government representatives to discuss sensitive issues; including, for instance, workshops focused on sharing experiences in implementing sustainable return and reintegration processes. Other events will be larger multi -stakeholder I dissemination conferences involving the public, with the intention to share lessons that have important implications and lessons beyond the ICGLR membership. I Objectives of the regional learning events more broadly include ra1smg awareness about forced displacement, its regional dimensions, and durable I solutions; sharing of challenges by all the countries to better identify their own solutions; encouraging technical discussions on issues that need to be addressed regionally; providing additional technical expertise if required; and facilitating I commitment to an ongoing process of regional information sharing and policy development on development responses to forced displacement. I I External Audit Report o.f Project Finan cial Statements - Period: From July I. 20 I 8 to June 30. 20 I 9 8 I I I Great Lakes Displaced Persons and Border Communities Project Grant IDA Number D230 I ./ Subcomponent I b: Support to the Technical Subcommittee of Experts on land, US$90,000 I The ICGLR has already been involved in issues of access to land for displaced persons; the ICGLR MSs adopted the Declaration on the Implementation of the Protocol on Property Rights. The declaration recommits to the establishment of I a subcommittee of experts with specific responsibility for land and property rights. T here remains much to be done with regard to the integration of the protocol into the national legal frameworks of the ICGLR MSs. This I subcomponent of the project will provide technical assistance to support the existing process of the ICGLR Technical Subcommittee of Experts on Land (TSCE) on land to establish reporting systems that ensure the effective implementation of the protocol. The ICGLR will also work w ith the TSCE to I formulate a research topic on land and displacement, the research results of which will be presented at the second TSCE group of experts meeting. I • Component 2: Regional Research, US$1,084,000 Reliable and informative research is crucial for developing evidence-based I policies and design ing the requisite development responses to forced displacement. Yet, robust data and research on issues related to forced displacement continues to be a challenge globally. This reality is no different in I the GLR. Availability of reliable and up-to-date data on forced displacement is one of the major challenges faced by Governments in the region and therefore impedes their ability to devise appropriate responses to the plight of persons I affected by displacement. It is within this context that the project will support the ICGLR and its MSs to I engage in research and data collection activities that aim to fill knowledge gaps, and in so doing, enable evidence-based policymaking. The typology for regional research initiatives will range from small-scale desk reviews, such as analysis of I local integration legal frameworks , to larger qualitative and quantitative impact assessments, for instance, quantifying the impact of displacement on host communities and on social cohesion. I • Component 3: Project Management and Institutional Capacity Building, US$1,199,000 I This component will cover the cost for project management, day-to-day planning, implementation, and supervision of project activities, administration of procurement and financial management (FM), capacity building, and I monitoring and evaluation (M&E). A Project Coordination Unit (PCU) within the ICGLR will be the focal coordinating unit and will manage the project account. The PCU will also support a Project Advisory Group (PAG) for the I project. I I I External Audit Report of Project Finan cial Statemenrs - Period: From Ju~v /, 2018 to June 30. 2019 9 I I I G_ _ _ _ _..;;. _ rea_ tL _k..c. -'--a es - Displaced Persons and Border Communities Project Grant !DA Number D230 I 1.4 Project's Budget The overall budget of the project is USD$3 Million over a period of 4 years. The table below presents the breakdown per component. I I -- - -- - ---- - - - - Amount USO 717,000.00 1,084,000.00 I 1,199,000.00 I I I I I I I I I I I I I I External Audit Report of Project Financial Stareme11ts - Period: From July 1. 2018 to June 30. 2019 10 I I Great Lakes - Displaced Persons and Border Communities Project Grant IDA Number D230 I 2. Notes to the financial statements as at June 30, 2019 2.1. Accounting policies and methods I The financial statements of the Project have been prepared in accordance with the rules and principles for the preparation and presentation of the accounts as set by the National Accounting Plan Standards amended where appropriate to meet the specificities of development projects. I These financial statements, which reflect the implementation of the project management activities, are comprised of: I the Balance Sheet; the Resources and Expenditures statements; I the Statement of Expenditures (SOE); the Statement of Reconciliation of the Designated Account I the list of inventory; and the notes providing details and explanations of the mam items of the financial I (i) statements. Basis of Accounting I The financial statements have been prepared on a modified cash accounting basis. (ii) Reporting currrency I Project accounts are held in USD. (iii) Valuation methods I The method used for the valuation of items in the financial statements is that of historical cost. (iv) Incomes I The resources reported in the accounts consist of funds actually received in the Project bank accounts and direct payments made by the World Bank to contractors. I (v) Expenses The expenses reported in the financial statements are expenses incurred within the Project implementation framework. I (vi) Cash and Bank balances I It corresponds to the Project cash and bank balances. A bank account was opened to receive project funds which is: IDA Designated Account in USD held at Banque de la Republique de Burundi (BRB) under the name "CIRGL-BM-DEPL". I At LM Centre at Lusaka (Zambia), there are: One Sub-Designated Account in USD held at BARCLAYS BANK ZAMBIA PLC and an I Operating Account in ZMW held at BARCLAYS BANK ZAMBIA PLC. I I External Audit Report of Project Financial Statements - Period: From July I. 2018 to June 30. 2019 11 I I I Great Lakes - Displaced Persons and Border Communities Project Grant IDA Number D230_ __ _ I The accounts opened in the name of the Project is to monitor the use of the IDA Grant. Movements observed in this account are consistent with those shown in the financial statements of the project. I 2.2. Comments on the balance sheet I Note 1: Cash and cash equivalents I This is the project cash and bank balances available as at 06/30/2019. The detail is as follows: Details I Amount in USO I BRB(USD) Petty Cash Bujumbura 271169 623 Barclays Bank Zambia (USD) 4 680 I Barclays Bank Zambia (ZMW) Total 276 617 145 I I I I I I I I I I I I External Audit Report of Project Financial Statements - Period: From July I. 2018 to June 30. 20/9 12 I I I _u_ Great Lakes - Displaced Persons and Border Communities Project Grant JDA_N m_be '-- r--' D 30 _2_ ' ---- -- - - 3. Statement of Fund Reimbursement Request for the year ended June 2019 I The statement below summarizes for each Fund Reimbursement Request the nature of the application and the categories of expenditure financed. I Amount Amount Reception Category Amount No payed Value date I ICGLRDOOl/2018 DA-A Type summary 1 requested 54 688 deducted in USO - inUSD 54 688 date 06/11/2018 06/11/2018 I ICG LRD002/ 2019 DA-A ICGLRD003/2019 DA-A 1 1 119 878 66970 - - 119 878 66970 15/03/2019 19/03/2019 11/06/2019 11/06/2019 241536 - 241536 I Total I I I I I I I I I I I Extema/ Audit Report of Project Financial Statements - Period: From Ju(I' I. 20 /8 to June 30. 2019 13 I be'r Great lakes - Displaced Persons and Border Communities Project Grant IDA Num.:.. -..cc. D..c... 23 0_ _ __ ;..;. I 4. Reconciliation of the Designated Account for the year ended June 2019 4.1. Statement of reconciliation of the IDA Designated Account USD I (Period from July 1, 2018 to June 30, 2019) The following statement summarizes the cash flows on the Project Designated Account held at I "Banque de la Republique de Burundi (BRB)" under the name "CIRGL-BM-3302/879". I Description Notes Amount in USD Opening balance I Incoming cash resources 1 285 776 I IDA funds received Other income 2 241536 I Available cash resources 527 312 Funds trans£erred to Lusaka 3 13976 I Cash payments I Goods, Non-Consulting Services, Consultants' Services, Operating Costs, Workshops and Training for the Project 241544 241544 I Total disbursements 255 520 I Theoretical closing balance 271 792 Reconciled Bank Closing Balance as at 06/30/2019 I Pettv Cash balance as at 06/30/2019 The notes form an integral part of these financial statements. 4 271169 623 I I I I I I External Audit Report of Proj ect Finan cial Statements - Period: From July J, 20 J8 to June 30, 2019 14 I I I _ __ _ :..:: Great Lakes - Displaced Persons and Border Communities Project Grant IDA Numb e;_rD =-2 3 =-= 0_ __ _ ..c:. I 4.2. Commentary notes on the statement of reconciliation of the Designated Account Note 1: Opening balance I The amount of USD 285 776 represents the opening balance funds at the beginning of the reviewed period. This balance is as same as the closing balance as at June 30, 2018. I Note 2: IDA funds received I The amount of USO 241 536 represents the funds received from the World Bank during the period reviewed under the Grant IDA D230 on the Designated Account held at Banque de la I Republique de Burundi (BRB). The breakdown is as follows: D ate of paym ent Amount in USO Details I ICGLRDOOl/2018 TCGLRD002/2019 6-Nov-18 15-Mar-19 54 688 119 878 ICGLRD003/2019 11-Jun-19 66 970 I Total 241536 I Note 3: Fund Transfer to LMC Lusaka This is the total amount transferred to Kampala RTF during the period under review. There have been four transfers of USO 13 976. I Details Date of trans£ert !Amount in USO ! I ICGLR - LMC/Funding for activities ICGLR - LMC/Funding for activities ICGLR - LMC/Funding for activities 12-Aug-18 5-Aug-18 18-Feb-19 3 000 976 10 000 I Total 13 976 I Note 4: Difference The difference of USO 623 between the theoretical closing balance and the bank balance as at I June 30, 2019 represents the petty cash balance as at June 30, 2019. I I I I I External Audit Report o.f Project Financial Statements - Period: From July 1. 20/8 to June 30, 2019 15 I Ann e112 ICGLR Oisplaced person .tnd ho~t comm un111, s Projec t Resource-san d Expenditures Statement for tho Y'•r ended 30 June 2019 Notes 2018 2019 Cummul1tlve July 201B to June Aucust 1018 to January 2019 June 2019 I I Cl>C, .,,.; cs~h 0.11.ir.cc USD - USO 285,716 USD IDA Funos Rec0:1,L?,Ill I 1 Cumulat,veadvancts at l April 2019 1 E111n>1e expenses up t o l April 2019 474,S66 204,931 I 3 O.ffere nce beweteen R,ceip ts ind Eligible t!xpendltures (l-2) 269,635 lhrt I I 4 Opening Bank 8~1,anct- ilS at 1 A s C:..sh as it 1 April 2019 pril 2019 268,537 I 1,123 6 Receipts from W8 durina lM' l)trlod 66,970 I Is is 7•l