Government of the Republic of Malawi LOCAL DEVELOPMENT FUND (LDF) FINANCIAL STATEMENTS FOR THE YEAR ENDED 30TH JUNE 2017 FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) - STRENGTHENING SAFETY NET SYSTEMS PROJECT CREDIT 5343 MW National Audit Office PO Box 30045 Lilongwe 3 LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW Table of Contents CONTENT PAGE EXECUTIVE DIRECTOR' S EXECUTIVE DIRECTOR' S REPORT FOR YEAR ENDED 30TH JUNE 2017 ... ...... ......... .... ...... ... ..... ... ... ..... ........ .... ......... ..... ........ ...... ..... ..... .. 3 EXECUTIVE DIRECTOR'S REPORT FOR YEAR ENDED 30TH JUNE 2017 .. .... continued ... .... ...... ......... .. ....... .. ......... ....... .. .... ..... .. ......... ... . 4 EXECUTIVE DIRECTOR ' S REPORT FOR YEAR ENDED 30TH JUNE 2017 .... Continued ... ... .... .... .. .. ........... ... ...... ... ..... ............ .. .... .... ........ . 5 EXECUTIVE DIRECTOR' S REPORT FOR YEAR ENDED 30TH JUNE 2017 .... Continued ... ... .. ... ..... .... .. .. ............. ........ .......... ........ .... ..... .. ... 6 AUDITOR GENERAL' S REPORT ... ..... ... .. .... .......... ........... ..... .......... ...... ....... .... .... ...... ......... ..... .. ....... . 8 STATEMENT OF FINANCIAL POSITION AS AT 30TH JUNE 2017 .... .... ..... ...... .... ..... .. ........ ... ......... ... ... ........ ...... ....... .... ... .... ... ..... ........ ...... ........ .. 11 RECEIPTS AND PAYMENT ACCOUNT FOR THE DESIGNATED ACCOUNT FOR THE YEAR ENDED 30TH JUNE 2017 .... ............ .... .. ... ..... .. ...... ... .... ...... ... ..... ...... .... .. ..... ..... ....... 13 NOTES TO THE FINANCIAL STA TEMENTS FOR THE YEAR 30TH JUNE 2017 .... .. .. .... .... .. ... .... ..... .. .......... ......... ..... ... ...... ...... .... ..... .............. .. .. ..... 14 NOTES TO THE FINANCIAL STATEMENTS CONT'D .. ... .......... .. .... ... ............. .... .. ....... ..... .. .. ....... 16 NOTES TO THE FINANCIAL STATEMENTS CONT'D ....... ....... ....... ........ ...... .... .. ........... ... .. ....... .. 17 NOTES TO THE FINANCIAL STATEMENTS CONT'D ..... ... ... ................. ......... ..... .. ....... .... .......... . 18 ANNEX II ....... .... ...... .... ... .. .......... ..... ....... ..... ... ... .... ... ......... ...... ..... .. ........... ... ......... ..... .......... ... .. .... .. ..... 22 LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW EXECUTIVE DIRECTOR'S REPORT FOR YEAR ENDED 30TH JUNE 2017 1. Establishment of the Local Development Fund (LDF) - LDF Areas of Operation The Government established the LDF to support and strengthen decentralisation process in Malawi with the overall objective to "empower local communities to take part in decision- making processes through improved local governance and development management, in order to reduce poverty and improve service delivery. " At the National Level, the Government established a Technical Support Team (TST) of experts responsible for the day to day operations of projects financing the LDF. The TST assists in (a) the development of operational procedures, (b) monitoring of project implementation and performance, and providing assistance to Ministries and Local Authorities involved in the implementation of the LDF. Responsible for policy guidance and approval of planning figures is the LDF Steering Committee with the following memberships: Secretary to the Treasury, Principal Secretary for Public Sector Reform, Secretary for Development Planning and Cooperation, Secretary for Local Government and Rural Development, representative of Council for Non- Governmental Organisations, Executive Secretary of National Local Government Finance Committee. The Steering Committee is supported by the National Technical Advisory Committee. At the Local Assembly level, the LDF has four funding windows maintained as budget lines under the control of the District Commissioner:- • Community Window for micro-projects requested and managed by communities using structures at the Village Development Committee level and finance services for strengthening economic growth; • Local Authority Window to finance investments too large for direct community management; • Urban Window for developing and improving economic services for private investments and especially for low income groups and stimulate economic growth and private investments; and • Performance Window to finance activities needed to address capacity constraints at Village, Area Development, and Local Authority development structures. 2 Funding Sources During the year to 30th June 2017, World Bank provided funding under MASAF IV Original Financing through credit number 5343 MW which became effective on 14th August 2014 and through Credit no 5610-MW and Grant D045 under Additional Financing signed on 13th August 2015. LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW EXECUTIVE DIRECTOR'S REPORT FOR YEAR ENDED 30TH JUNE 2017 ..... .continued MASAF IV Original Financing Through Credit no 5343-MW under Original Financing, the IDA has provided SDR21.4m- Special Drawing Rights (US$30.4m) to support implementation of Strengthening Safety Net Systems Project. MASAF IV Additional Financing Through Credit no 5610-MW and Grant D045 under Additional Financing signed on 18th August 2015 , the IDA has provided SDR52.8m (US$75million) to support implementation of Strengthening Safety Net Systems Project. The programme will run up to 30th June 2018. The Project Development Objective (PDO) of the proposed project is "to strengthen Malawi ' s social safety net delivery systems and coordination across programs." The PDO would be achieved through the strengthening of a Social Safety Nets system, which would increase productive assets and reduce the impact of shocks and vulnerability of the poor in Malawi and improve coverage of targeted benefits . The overarching goal of the PDO is to reduce vulnerability. In the PDO, strengthening delivery systems would mean providing coverage and support for the poor and vulnerable households for the purpose of improving incomes, resilience, assets and ability to manage risks. This would be assessed in terms of (i) targeting and coverage of benefits, (ii) adequacy of the benefit in terms of ability of households to invest in household level assets and human capital, and (iii) capacity of involved institutions to manage the program efficiently so that the costs of delivery are within established norms for effective safety nets. The Project activities are supported through three Components and these are: (a) Productive Safety Nets, comprising of three subcomponents: Productive Public Works Programme; Livelihoods and Skills Development; and Social Cash Transfer; (b) Systems and Capacity Building; and (c) Project Management. These statements have been prepared to reflect the activities and position of MASAF IV Original Financing, Strengthening Safety Net Systems Project, Credit no 5343-MW for the period ended 30th June 2017. 3.0 PROGRAMME ACHIEVEMENTS 3.1 Productive Safety nets component (a) Productive Public Works A total of 985,635 households (representing 100% of End of Project target) have been reached with Productive Public Works Programmed cash transfers of which 450,000 EXECUTIVE DIRECTOR'S REPORT FOR YEAR ENDED 30TH JUNE 2017 .... Continued households are repeated across each of the cycles since June 2016 to enable the beneficiary livelihoods achieve enough resilience against shocks. In the year under review, an additional 450,000 households had been reached in 2 cycles through the Emergency Public Works Programme. A total of MK15.6billion (USD21.5million) has been transferred to councils for implementation of PWP during the year under review. (b) Livelihoods and skills development As at the end of June 2017, a total of 5,254 groups were formed against end target of 6,697 groups. These groups have a total membership of 134,700 people surpassing the targeted 120,808 members by 13,892. Overall, a total of256 cooperatives and clusters have benefited against an end of Project target of 400. On savings mobilisation, cumulative group savings were estimated at MK2.9 billion against the targeted MK4.2 billion. (c) Social Cash Transfer The SCT sub-component had initially targeted Dedza and Nkhata Bay district councils, with 21,612 households against the target of21,000 enrolled and receiving cash transfers . The SCT programme is being scaled up to 9 additional district councils namely; Rumphi, Nkhotakokota, Lilongwe, Kasungu, Blantyre, Chiradzulu, Dowa, Ntchisi and Karonga. Resources amounting to US$4.4million (MK3.3billion) had been disbursed to councils for implementation of the Social Cash Transfer programme during the year under review. These include : transfers to beneficiary households ; funds for case management and for administration for Dedza and Nkhata Bay district councils and roll out of SCT in the 9 additional districts. 3.2 Systems and Capacity Building Component Major accomplishments included: Training of District Training Teams (DDT members in UBR processes; Supervision of UBR data collection process in the 9 councils; Support finalization of Safety net planning process in urban councils; Facilitation on the updating of Social Economic Profiles (SEPs) and District Development Plans (DDPs) for Dedza and Nkhata-Bay district; Training of DESC members in Geographical Information System (GIS); and monitoring of UBR data collection processes. Other achievements included, reviewing of Screening Forms for PWP and Infrastructure Projects, enhancing implementation of the Environmental and Social Safeguards in the councils and a meeting with all Environmental District Officers. C EXECUTIVE DIRECTOR'S REPORT FOR YEAR ENDED 30m JUNE 2017 .... Continued 3.3 Project Management Support towards coordination and supervision of the programmes continued during the year to ensure effective delivery of the respective programmes. Some of the achievements included Formative evaluation of the UBR targeting processes in six district councils; Dissemination of findings from the Implementation Support Mission; and dissemination of the Citizen Report Card to key stakeholders; Tracking progress on programme indicators i.e. monitoring of Results Framework targets; UBR platform development and implementation; Mthandizi MIS review and upgrade; Social Cash Transfer System Review and Development; production and airing of radio messages; Production of Information, Communication and Education materials; and media tours to project sites. Charles Mand a EXECUTIVE DIRETOR LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW STATEMENT OF MANAGEMENT RESPONSIBILITIES FOR YEAR ENDED 30TH JUNE 2017 The Executive Director at Technical Support Team, under the Direction of the Secretary to the Treasury as Controlling Officer and Secretary for Local Government and Rural Development as overseer on programmatic matters, is responsible for preparing the Annual Financial Statements of the LDF in accordance with the financing agreements for the projects supporting the LDF and in line with the Public Finance Management. In preparing the Financial Statements, the Executive Director is required to: a) Select proper and suitable accounting policies and apply then consistently; b) Make judgements and estimates that are reasonable and prudent; c) Prepare the financial statements on a going concern basis unless circumstances dictate otherwise. d) Comply with applicable accounting standards when preparing the consolidated financial statements, subject to any material departures being disclosed and explained in the consolidated financial statements The Executive Director and Controlling Officers of all agencies utilising LDF funds are responsible for keeping proper accounting records that reflect with reasonable accuracy at any point in time, the financial position of the components of the LDF under their implementation. Each Controlling Officer is answerable to the Public Accounts Committee of Parliament. The Secretary to the Treasury, however, takes overall answerability to the LDF Funding partners and Public Accounts Committee. The management is of the opinion that the financial statements give a true and fair view of the financial affairs of the project and of its operating results . The financipl statements have been approved by the Local Development Fund on .. .Jf.?..f..4:J ..~.~ ..l~ ..... and are signed on its behalf by: 7-7--,---,-77-r--"' -, EXECUTIVE DIRECTOR --· '-./. "7 Telephone: + 265 I 770 700 In reply please quote No . .......... ............... .. ... .... . Facsimile: +265 I 773 071 NATIONAL AUDIT OFFICE +265 I 776 125 +265 I 774 138 P.O. BOX 30045 CAP IT AL C ITY All Communications should be addressed to: LILONGWE 3 National Audit Office MALAWI AUDITOR GENERAL AUDITOR GENERAL'S REPORT TO THE EXECUTIVE DIRECTOR ON THE FINANCIAL STATEMENTS OF THE LOCAL DEVELOPMENT FUND (FOURTH MASAF - STRENGTHENING SAFETY NET SYSTEMS) PROJECT CREDT NUMBER 5343-MW FOR THE YEAR ENDING 30TH JUNE, 2017 Opinion I have audited the of Financial Statements of Local Development Fund (Fourth MASAF- Strengthening Safety Nets Systems) Project-Credit Number 5343-MW , comprising Statement of Financial Position, Statement of Receipts and Payments, Statement of Designated Account and other explanatory notes for the year ended 30th June, 2017 as set out on pages 11 to 24. In my opinion, except for the possible effects of the matters described in the Basis for Qualified Opinion paragraph, the financial statements, present fairly, in all material respect, the financial position of Local Development Fund (Fourth MASAF - Strengthening Safety Nets Systems) Project as at 30th June, 2017, and of its financial performance for the year then ended in accordance with International Public Sector Accounting Standards (IPSAS) and in the manner required by the Donor. Basis for qualified Opinion I conducted my audit in accordance with International Standards of Supreme Audit Institutions (ISSAis ). My responsibilities under those standards are further described in the Auditor 's Responsibilities for the Audit ofthe Financial Statements section ofmy report. I am independent of the Local Development Fund in accordance with the International Standards of Supreme Audit Institutions - Code of ethics (ISSAI 30) as promulgated by the International Organisation of Supreme Audit Institutions (INTOSAI), and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. The Project through Nsanje District Council incurred expenses worth K18 , 550,102.00 without supporting documents as highlighted in paragraphs 4.15.6 and 4.15.7, therefore, I could not ascertain the validity of such payments. 0 Key Audit Matters Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters. I have determined that there is no need to communicate key audit matters in my report due the nature of the audited entity. Responsibilities of Management for the Project's Financial Statements Management of the Local Development Fund is responsible for the preparation and fair presentation of the financial statements in accordance with International Public Sector Accounting Standards (IPSAS) Financial Reporting under the Cash Basis of Accounting, Donor terms of agreement and financial provisions, and for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. This responsibility includes designing, implementing and maintaining internal controls relevant to the preparation of the financial statements that are free from material misstatements, whether due to fraud or error. Auditor's Responsibilities for the Audit of the Project's Financial Statements My 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 my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standards of Supreme Audit Institutions (ISSAis) 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 Project's Financial Statements. As part of an audit in accordance with ISSAis, I exercise professional judgment and maintain professional scepticism throughout the audit. I 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 my 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 internal control. (\ • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. • Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. I 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 I identify during my audit. I also provide those charged with governance with a statement that I have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, I determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditor' s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. The engagement auditor on the audit resulting in this independent Auditor General ' s report is: Signature:~ ... STEPHENSON KAMPHASA AUDITOR GENERAL NATIONAL AUDIT OFFICE LILONGWE MALAWI r (g/~ Date: ... ( "$:;I••••••••••••• 1 (\ LOCAL DEVELOPMENT FUND (LDF) FOURTH MALAWI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW FINANCIAL STATEMENTS STATEMENT OF FINANCIAL POSITION AS AT 30TH JUNE 2017 Note s As at 30 June 201 7 As a t 30 June 2016 US $ MK US$ MK Non-Current Assets Social Economic Investments Public Wo rks Programm e 5 19,793 ,407 12,056,789, 102 16,45 7,390 9,59 1,2 13,959 Social Cash Transfe r(SCT) 5 2,385 ,689 1,360, 162,533 1,903 ,892 1,007,497, 167 Livelihoods & Ski ll s Development 5 I 709 807 864,293 ,1 48 I 709 807 864,293, 148 Total 23,888 ,903 14,281,244,783 20,07 1,089 11 ,463,004,273 Property, Plant & Equipment Motor Vehicles 6 1, 199,989 703 , 19 1,790 1, 199,989 703 , 19 1,790 Co mputers 6 626,25 1 379,2 16,969 626,25 1 379,2 16,969 Office Equipment 6 972,3 14 589,72 1,924 972,3 14 589,72 1,924 Total 2,798,555 1,672,130,683 2,798,555 1,672,130,683 Total Non-C urrent Assets 26,687,458 15,953 ,375,466 22 ,869,644 13,135,134,956 Current Assets Bank and cash Balances 4 6 422 4 42 8 496 4,226,236 3, 197,069,854 Total Current Assets 6,422 4,428,496 4,226,236 3,197,069,854 Total Fund Employed 26 623 880 15 25'.Z 803 262 2'.Z 025 880 16 332 204 810 Financed by : Wo rld Bank (IDA)Credit 5343 -MW 7 30,407,589 18,082,852,945 30,407,589 18, 167,540,842 Other Receipts 3 25 ,896 14,636, 114 25 ,896 14,636, 11 4 Local Authority Capac ity Enhancement (LACE) 5 ( I, 195 ,322) (69 1, 172,016) ( 1,037,8 14) (578,379,88 1) Project Management 5 (2,544,283) (1 ,448,5 13,08 1) (2,299,792) ( 1,27 1,592,265) Total Finances 26 623 880 15 25'.Z 803 262 2'.Z 025 880 16 332,204,810 Executive Director ............ . ... .. ...... .. . ...... ... ...... ... .............................C.Mandala 11 LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW STATEMENT OF RECEIPTS AND PAYMENTS FOR YEAR ENDED 30TH JUNE 2017 30th Jun e 2017 30th June 201 6 Notes US$ MK US$ MK RECE IPTS IDA Credit 3 21,002,664 13,843 ,929, 17 1 Other Receipts 3 22,482 13,003 ,087 Exchange Difference (Loss) 3 (84,687,898) Receipts for the Year (84,687,898) 2 1,025,146 13,856,932,257 Opening Balances 4 4,226,236 3.197.069.853 3,5 16. 153 1.590. 188.880 Total Income 4,226,236 3,112,381 ,955 24,54 1,299 15,447,121 ,137 Expenses Public Works Programme (PWP) 5 3,336,0 18 2,465 ,575 , 143 14,537,600 8,703 ,870,6 19 Social Cash T ransfer s 48 1,797 352,665 ,366 1,307,720 726, 171 ,46 1 Livelihoods & Skills Development s 697,79 1 408,850,559 Local Authority Capacity Enhancement (LACE) s 157,508 11 2,792, 135 809,027 47 1,098,786 Project Management 5 244,49 1 176,920,81 6 1,363,042 833 ,385, 160 Equi pment 6 1,599,884 I 106 674 700 Tota l Ex penses 4,219,814 3, l 07,953,460 20,315,063 12,250,051,284 Closin g Balanc e 6 422 4,428 426 4 226 236 3 121,062 853 12 LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW RECEIPTS AND PAYMENT ACCOUNT FOR THE DESIGNATED ACCOUNT FOR THE YEAR ENDED 30TH JUNE 2017 30th June 2017 30th June 2016 US$ US$ Receipts IDA Credit 0 21,002,664 Other Receipts-Interest 56 22 482 Total Cash Received in year 56 21,025,146 Expenditure I . Goods, works, no n-consulting services, co nsultants ' services and Operational Costs for Part A . I of the Proj ect (709,282) 16, 165 ,922 2. Goods, consu ltants' servi ces, Operational Costs and Training for Parts A .2 and A.3 of the Project 357,523 3. COMS IP Grants for Part A.2 (a) of the Project 5 18,646 4.Cash Transfer instalments for Part A.3(a) of the Project 1, 163 ,279 5. Goods, non-consul ting services, co nsultants ' services, Training and Operational Costs fo r Parts B and C of the Project (2,925) 2 IOI 676 Total (712,207) 20,307,047 Net Cash Movemen t 7 12,263 718,099 Local Operating Acco unt Advances to Co uncils and COMSJP 3,522, 125 Opening Balance I July 7 12, 152 3,516, 178 Total Closing Balance (Designated Account) 712 )52 • , .., LOCALDEVELOPMENTFUND~D~ FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) - STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDlT 5343 MW NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR 30TH JUNE 2017 1. Nature of Business Through Credit No 5343-MW under Original Financing, the IDA has provided SDR21.4m- Special Drawing Rights (US$30.4m) to support implementation of Strengthening Safety Net Systems Project. 2. Accounting Policies 2.1 Basis of preparing the Accounts: The financial statements have been prepared on the historical cost convention and on a cash basis in accordance with International Public Sector Accounting Standards (IPSAS). All receipts and expenses incurred in the period are reflected in the financial statements. 2.2 Fixed Assets Capital expenditures are capitalized in the year the assets are purchased. There is no provision for depreciation on the fixed assets throughout the Project life. 2.3 Grants to Local Assemblies Disbursements to Community Window, Local Authority Window and Urban Window are done through tranches while those to Performance Window are based on assessment. Once disbursements to Local Assemblies are made, they are treated as Grants in the financial statements. 2.4 Foreign Currency Translation Foreign currency transactions for the income and expenditure account items and fixed assets are translated using the actual exchange rate at the date of draw down. All local expenditures paid from the local accounts/currency are translated back to US dollar at the actual exchange rate at which draw-down was converted at the date of transfer from Special/Designated account to local account. Where the expenditure cannot be fully met from the proceeds of a draw down , and part of the expenditure has to be met from the proceeds of the subsequent draw down, which may have been effected at a different conversion rate, the translation rate of the total expenditure from the local currency to the US dollar is on First in First out (FIFO) basis. Current assets and special/Designated account balances are translated using the rate at the closing date. (Closing Rate Method). 1 A 2.5 Receipts Receipts from Development Partners/Donors are stated at actual amounts drawn from the World Bank by way of replenishment into a Designated/Special Account at Reserve Bank of Malawi and direct payments . 1 C LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTrON FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW NOTES TO THE FINANCIAL STATEMENTS CONT'D 3 - Cash Withdrawals from Credit Account Date Details US$ MK Total Cash Withdrawals from Credit Financing Account Current Year Total Cash Withdrawals from the Financing Accounts Previous Year 30, 138 ,232 18,052,540,864 Total Cash Withdrawals from the Financing Accounts 30,138,232 18,052,540,864 3. 1 - Direct Payment - (MASAF IV) US$ MK Direct Payments Previous year 269,357 114,999,979 Total Direct Payments 269,357 114,999,979 Total from lDA 30,407,589 18,167,540,842 3.2 - Other Receipts Total Other Receipts Current Year Total Other Receipts Previous Year 25 ,896 14,636, 114 Total Withdrawals 30,433,485 18,182,176,956 1 /' LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4)-STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW NOTES TO THE FINANCIAL STATEMENTS CONT'D 4 - Balances US$ l Kwacha Opening Balances as at 1 July 2016 I RBM Holding Account (Part I) 160,823 110,890,292 2 MSB Operating Account 2,3 14,947 I,709 ,969,972 3 Funds Drawn but not yet utili sed + Commitments 1,038 ,313 775 ,061 , 107 4 Designated Account -2nd Additional Financing 712,151 60 I, 148,482 Total opening Balance as at 1 Julv 2016 4,226 236 3,197,069,854 Closing Balances as at 30 June 2017 I RBM Holding Account (Patt I) 646 445 ,476 2 MSB Operating Account 5776 3,983 ,020 3 Funds Drawn but not yet utilised + Commitments 0 0 4 Designated Account -MASAF IV 0 0 Total closin1r Balance as at 30 June 2017 6,422 4,428,496 1 ,.., LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) -STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW NOTES TO THE FINANCIAL STATEMENTS CONT'D 5 - Productive Safety Nets, Systems and Capacity Building and Project Management Public Works Subprojects US$ Kwa cha Disbursements to Sub Projects-Public Works Programme(MASAF IV) 3,336,0 18 2,465 ,575 ,143 Disbursements to Sub Projects-Savings and Investment Total charged to PW (Category 1 ) 3,336,018 2,465,575,143 Add from previous years 16,457,3 90 9,591 ,2 13 ,959 Balance Carried forward 30 June 2017 19,793,408 12,056,789, 102 Social Cash Transfer Disbursements for Social Cash Transfer(MASAF IV) 481 ,797 352,665,366 Total charged for SCT (Category 1 & 4) 481,797 352,665,366 Add from previous years 1,903 ,892 1,007,497,167 Balance Carried forward 30 June 2017 2,385,689 1,360,162,533 Livelihoods and Skills Develooment Disbursements to Community Savings & lnvestment(MASAF IV) 0 0 Total charged to CMSP (Category 2& 3) 0 0 Add from previous years 1,709,807 864,293 , 148 Balance Carried forward 30 June 2017 1,709,807 864,293,148 Local Canacitv Enhancement (LACE) Disbursements to Local Capacity Enhancement(LACE)(MASAF IV) 157,508 112,792, 135 Total charged to LACE (Category 5) 157,508 112,792,135 Add from previous years 1,03 7,814 578,3 79,881 Balance Carried forward 30 June 2016 1,195,322 691,172,016 1 0 Project Management Project Management(MASAF IV) 244,49 1 176,920,816 Total charged to Project Management (Category 5) 244,491 176,920,816 Add from previous years 2,299,792 1,2 71,592,265 Balance Carried forward 30 June 2016 2,544,283 1,448,513,081 Grand Total for Sub Grant Investments 27,628,509 16,420,929,881 6.0 - Fixed Assets MOTOR VEHICLES US$ MK Ba lance B/Forward I July 20 16 I, 199,989 703 , 191,790 Additions during the year Disposals during the year Balance C/Down 30 June 2017 1,199,989 703,191,790 COMPUTERS us$ MK Balance B/Forward I Jul y 2016 626,251 379,216,969 Additions during the year Disposals during the year Balance C/ Down 30 June 2017 626,251 379,216,969 OFFICE EQUIPMENT US$ MK Balance B/Forward I July 2016 972,314 589,721 ,924 Additions during the year - - Balance C/Down 30 June 2016 972,314 589,721,924 Total Movement for year - - Closin2: Balance as at 30 June 2016 2,798,555 1,672,130,683 11"'1 LOCAL DEVELOPMENT FUND (LDF) FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) - STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW NOTES TO THE FINANCIAL STATEMENTS CONT'D 7.0 - Funding by Donors World Bank Drawings us$ Kwacha Credit 5343-MW Exchange Difference (84 ,687,898) (84,687,898) Sub Total 30,407,589 18 ,167,540,842 Previous year Credit 5343-MW Total Credit 30,407,589 18,167,540,842 Total Drawings for Twelve months period to 30 June 2017 (84,687,898) Total Drawings (Cumulative) as at 30 June 2017 for Credit 30,407,589 18,082,852,945 Other Receipts Add from Previous years 25,896 14,636,114 Total Other Recei ts to date 25,896 14,636,114 8.0 Cashflow Statement The financial statements as at 30th June 2017 do not include the Statement of Cash flow because the information contained in the Statement of Receipts and Payments is similar to that in the Cash Flow Statement due to fact that no provisions have been made and does not contain cash equivalents. FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) - STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW ANNEX 1: DESIGNATED ACCOUNT MOVEMENT FOR THE PERIOD TO 30 JUNE 2017 Description Date US$ MK Rate Opening Balance I-Jul- 16 712 ,151.39 601 ,148,482 .38 844.13 Bank Charges on FCDA -Standard Bank- M5 -EC3470 US3. 38 7/12/20 16 -3.38 -2,474 .1 6 732.00 30% PWP Emergency Funding for Nsanje M5 -PINST37 District Council-Payment Instru ction No. 37 7/2 1/20 16 -709,282.00 -5 14,37 1,306.40 725.20 Bank Commission Charges on transfer of M5-MWl6622 US$709,282 by Standard Bank 7/21 /20 16 -60.00 -43 ,920.00 732.00 Bank Transmission Fees for US$709,282 M5-EC40 18 by Stand ard Bank 7/25/20 16 -6.70 -4,904.40 732 .00 July 201 6 FCDA Interest-Stand ard Bank- M5 -3 IJ WTX US$ 153.70 7/3 1/20 16 153.70 112,508.40 732 .00 July 20 16 WTAX on Interest- Standard M5-WT3 IJ Bank-US$27.98 7/3 1/20 16 -27 .98 -20,48 1.3 6 732.00 Transfer charges for US$2,865.03- M5 -BNTRl88 Stand ard Bank -US$60 8/18/20 16 -60.00 -43 ,692.00 728 .20 Transfer ofUS$2,865.03 to MASAF IV M5 -PI NST38 Ho lding Account-Payment Instruction No . 38 8/18/20 16 -2,865.03 -2,086,3 14.85 728 .20 Closing Balance 0.00 84,687,897.61 Closing Rate Exchan ge Difference (84,687,897.61) Previous year's Net Movement for the current vea r (84,687,897.61) ,..,, FOURTH MALA WI SOCIAL ACTION FUND (MASAF 4) - STRENGTHENING SAFETY NET SYSTEMS PROJECT-CREDIT 5343 MW ANNEX II PWP FUNDING TO COUNCIL FOR THE FINANCIAL YEAR 2015/17 PWP FUN DING TO COUNC IL FOR TH E FINANC IA L YEA R 20 16/17 Fundin g from Funding from umber Co uncil Origin al Add ition al Fin ancin g Financin g Total Funding Balaka District Council 688,851,790 688,851 ,790 2 Blantyre District Council 448,309,773 448,309,773 3 Blantyre City Council 569,897,23 1 569,897,231 4 Chitipa District Council 68,570,793 244,890,000 3 13,460,793 5 Chiradzu lu Di strict Counci l 427,645 ,741 427,645,741 6 Chikwawa District Counci l 13 1,3 15,807 468,990,000 600,305,807 7 Dedza District Council 684,655 ,518 684,655 ,518 8 Dowa District Council 429,577,936 429,577,936 9 Karonga District Council 12 1,6 14,875 434,340,000 555,954,875 10 Kasungu District Council 98,585 ,822 352,080,000 450,665,822 11 Kasungu Mun icipal Counci l 8,244,035 37,679,720 45 ,923 ,755 12 Likoma District Council 7,836,058 28,890,000 36,726,058 13 Lilongwe District Council 86 1, 169,598 86 1,169,598 14 Lilongwe City Council 523 ,5 17,480 523 ,517,480 15 Lucheza Municipal Council 13,364,241 55 ,268,500 68,632,741 16 Mangochi District Counci l 700,229,239 700,229,239 17 Machinga Di strict Counci l 706,822 ,405 706,822,405 18 Mangochi Town Counci l 83 ,6 56,467 83 ,656,467 19 Mchinji District Counci l 398, 153 ,262 398, 153 ,262 20 Mulanje District Counci l 13 1,944,946 471 ,240,000 603, 184,946 21 Mwanza District Counci l 23 , 102,680 82,782,000 I 05 ,884,680 22 Mzimba (M'mbelwa) District Council 128,393 ,600 458,550,000 586,943,600 23 Mzuzu City Council 65 ,215 ,39 1 242,307,132 307,522,523 24 Neno District Council 245 ,306,768 245 ,306,768 25 Nkhatabay District Council 69,643 ,386 248 ,724,000 3 18,367,386 26 Nkhotakota District Counci l IO1,643 ,802 363,006,000 464,649,802 27 Nsanje District Counci l 11 3,553 ,248 405 ,540,000 5 19,093,248 28 Ntchisi District Counci l 3 12,563 ,047 312,563 ,047 29 Ntcheu District Council 439,802,495 439,802,495 30 Phalombe District Counc il 10 1,090,384 361 ,044,000 462, 13 4,384 31 Rumphi District Council 67,590,394 241 ,398,000 308,988,394 32 Salima District Council 708 , 181 ,029 708 , 18 1,029 33 Thyo lo District Council 7 16,479,852 716,479,852 34 Zomba District Counci l 642,608,3 17 642,608,3 17 35 Zomba City Council 307,864,132 307,864, 132 Total 1,251 ,709,462 14,392,021 ,432 15,643,730,894 ') ') FU DING TO COUNCILS SOCIAL CASH TRANSFER (SCT) FUNDING TO COUNCILS FOR THE FINANCIAL YEAR 2016/17 Funding from Funding from Number Council Original Additional Financing Financing Total Funding Blantyre District Council SCT 110,512,291 110,512,291 2 Chiradzu lu District Counci l SCT I 09 ,940, 799 I 09 ,940,799 3 Dowa District Council SCT 176,356,059 176,356,059 4 Dedza Distrcic Council SCT 259,788,500 1, 110,966,750 1,370,755 ,25 0 s Karonga District Council SCT 101 ,583 ,556 101 ,583 ,556 6 Nkhotakota District Council SCT 103,400,175 103 ,400, 175 7 Kasungu District Council SCT 2 11 ,608,350 211 ,608,3so 8 Lilongwe District Council SCT 3 16,782,S 18 316,782,S 18 9 Nkhatabay District Council SCT 9 1,272,000 455,787,250 547,059,25 0 10 Ntchisi District Council SCT IO 1,909,214 IO1,909,214 11 Ntcheu District Council SCT 26,411 ,230 26,41 1,230 12 Rumphi District Council SCT 88,734,580 88,734,580 Total 351 ,060,500 2,913,992,772 3,265,053,272 ') 'l