We Do More! f r Tit-Fv(3)Mnh Eb4' STATISTICAL INSTITUTE OF JAMAICA GRANT NO. TF095366 TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 STATISTICAL INSTITUTE OF JAMAICA GRANT NO. TF095366 TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 TABLE OF CONTENTS PAGE REPORT OF THE AUDITORS TO THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT 1 - la Statement of Source and Use of Funds 2 Statement of Cumulative Investments 3 Statement of Cash Flows 4 Notes to the Statement of Source of Funds and Use of Funds 5-7 Dawgen Chartered Accountants Incorporating Paul Goldson & Co. Corporate Head-Office Unit 34 Winchester Business Centre 15 Hope Road Kingston 10 Jamaica, W.I. Phone +876-9084007 Fax +876-7540380 Email info@uhy-ja.com Web www.uhy-ja.com REPORT OF THE AUDITORS TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 Report on the Financial Statements We have audited the accompanying Statement of the Source and Use of Funds, the Statement of Cumulative Investments and Statement of Cash Flows for the TFSCB for Strategic Statistical Development Project, executed by the Statistical Institute of Jamaica (STATIN) under a subsidiary agreement with the Ministry of Finance and the Public Services and the notes comprising of a summary of significant accounting policies and other explanatory information. The project was funded by the International Bank for Reconstruction Development (IBRD) Grant No. TF095366 for the thirty-five (35) months ended 31st December 2014. Management's Responsibility for the Financial Statements These statements are the responsibility of the management of the Statistical Institute of Jamaica for Grant TF095366 JA- TFSCB for Strategic Statistical Development Project. Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and for such internal controls as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing, and the International Bank for Reconstruction and Development (IBRD) requirements. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance that the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence relating to the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity's preparation of financial statements that give a true and fair view 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 entity's internal control. LOCATIONS: Oxford House Shop 2B (Upstairs) Shop EU6 Shop C1 2nd Floor Caledonia Mall Whitter Village 101B Main Street 6 Oxford Road Mandeville Montego Bay Ocho Rios Kingston 5 Manchester StJames St. Ann T +876-9263562 T: +876-9626369 T: +876-9533793/9538486 T: +876-9748772 F: +876-9291300 F: +876-7540380 F: +876-9533058 F: +876-9745373 E: infobranch@uhy-ja.com E: infobranch@uhy-ja.com E: infobranch@uhy-ja.com E: infobranch@uhy-ja.com A member of UHYInternational, a network of independent accounting and consulting firms ,flI~'Dawgen Pu o CharteredAccountants Incorporating Paul Goldson & Co. Page Ia REPORT OF THE AUDITORS TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 Auditors' Responsibility (Cont'd) The Statement of Source and Use of Funds and the Statement of Cumulative Investments were prepared using the modified cash basis of accounting, which is another comprehensive basis of accounting other than generally accepted accounting principles. These statements are also expressed in United States and consequently there were foreign exchange translations using prescribed exchange rates. The exchange rates used in such translations were considered reasonable. Opinion In our opinion, the financial statements referred to above give a true and fair view of the source and use of funds, the cumulative investments and statement of cash flows for Grant TF095366 JA-TFSCB for Strategic Statistical Development Project for the thirty-five (35) months ended 31st December 2014, in accordance with the modified cash basis of accounting and the terms of IBRD Grant TF095366. UHY Dawgen Signature UHY DAWGEN CHARTERED ACCOUNTANTS 20th March 2015 A member of UHYInternational, a network of Independent accounting and consulting firms Page 2 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT STATEMENT OF SOURCE AND USE OF FUNDS THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 IBRD DESIGNATED ACCOUNT TOTAL us$ US$ Source of Funds Activity for the thirty-five (35) Months Ended 31st December 2014 * Funds advanced by IBRD (Page 4) 137,402 137,402 * Direct Payment to STATIN 70.914 70,914 * Special Commitment - - * Interest received - Total Cash Received for the thirty-five (35) Months Ended 31st December 2014 208.316 208.316 Use of Funds Activity for the thirty-five (35) Months Ended 31st December 2014 * Consultants' Services (Statement 3) Withdrawal Pending Justification 26,504 26,504 Pending Justification/Reimbursement 60.887 60,887 * Training (Statement 3) Approved Disbursements 158,317 158,317 Withdrawal Pending Justification 14,183 14,183 * Pending reimbursement to beneficiary (60.887) (60.887) * Other: Bank Charges (Page 4) 67 67 Withholding Tax Total Expenditure for the thirty-five (35) Months Ended 31st December 2014 199.071 199,071 Available Cash Balance 9.245 9.245 The accompanying notes form an integral part of this statement. APPROVED FOR ISSUE ON BEHALF OF THE BOARD OF DIRECTORS ON AND SIGNED ON ITS BEHALF BY: Alvin Wint Carol Coy Chairman Director General Page 3 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT STATEMENT OF CUMULATIVE INVESTMENTS THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 INVESTMENT CATEGORY IBRD TOTAL US$ US$ 1.0 Part 1: Statistical Master Plan 1.1 Consultants' Services 1.2 Training 2.0 Part 2: Institutional Strengthening of STATIN 2.1 Consultants' Services 87,391 87.391 2.2 Training 172.500 172.500 259,891 259.891 3.0 Part 3: Strengthening of National Statistical System 3.1 Consultants' Services 3.2 Training . _ GRAND TOTAL 259,891 259,891 Percentage of loan disbursed The accompanying notes form an integral part of this statement. Page 4 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT STATEMENT OF CASH FLOWS THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 DESIGNATED DATE DESCRIPTION DEBIT CREDIT ACCOUNT BALANCE US$ US$ US$ December 7, 2012 IBRD deposit to designated account 50,000.00 50,000.00 December 7, 2012 Bank charges 25.34 49,974.66 January 4, 2013 Withdrawal from designated account (No. 1) 46,087.26 3,887.40 March 1, 2013 Reversal of bank charges 25.34 3,912.74 September 17, 2013 Withdrawal from designated account (No. 2) 3,356.97 555.77 November 12, 2013 IBRD deposit to designated account 22,087.43 22,643.20 November 12, 2013 Bank charges 22.08 22,621.12 December 24, 2013 Withdrawal from designated account (No. 3) 10,452.16 12,168.96 April 9, 2014 Withdrawal from designated account (No. 4) 1,356.52 10,812.44 July 3, 2014 IBRD deposit to designated account 37,808.00 48,620.44 July 3, 2014 Bank charges 22.60 48,597.84 September 19, 2014 Withdrawal from designated account (No. 5) 26.150.53 22,447.31 October 9, 2014 Withdrawal from designated account (No. 6) 9,530.10 12,917.21 October 23, 2014 IBRD deposit to designated account 27,507.04 40,424.25 October 23, 2014 Bank charges 22.50 40,401.75 December 19, 2014 Withdrawal from designated account (No.7) 31,156.83 - 9,244.92 128,182.89 137,427.81 9,244.92 The accompanying notes form an integral part of this statement. Page 5 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT NOTES TO THE STATEMENT OF SOURCE AND USE OF FUNDS THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 A. INTRODUCTION AND OBJECTIVES: Request for financial assistance for the Strategic Statistical Development Project was made by the Government of Jamaica (GOJ), through the Ministry of Finance and the Public Services. The International Bank for Reconstruction and Development (World Bank) responded on May 12, 2011 proposing to extend grant ftnding in an amount not exceeding Three Hundred and Forty Six Thousand Five Hundred United States Dollars (US$346,500) provided under the Trust Fund for Statistical Capacity Building (TFSCB) to assist in the financing of the Strategic Statistical Development project. The agreement was signed on 18th May 2011 by the Ministry of Finance and the Public Services. To facilitate the carrying out of the Project, a subsidiary agreement was signed 27th January 2012 between the Ministry of Finance and the Public Services and the Statistical Institute of Jamaica (STATIN), the Project Implementing Entity. to which the proceeds of the Grant were made available. The objective of the Project is two-fold: (a) to strengthen the institutional capacity of the Statistical Institute (STATIN): and (b) to strenghen the national statistical system. The aim is to provide financial and technical input to adopt strategic approach in improving the scope and quality of statistical services. The following specific activities were to be undertaken: Part 1: Statistical Master Plan (a) Preparing an inception report and carrying out a stakeholder workshop to launch the statistical master plan (SMP) process. (b) Conducting a needs assessment consisting of an evaluation of the existing activities in the collection analysis and storage of data within the ministries, departments and agencies and their resource requirement. (c) Preparing the SMP based on the statistical development strategy. (d) Carrying out a stakeholder workshop to adopt the SMP. Part It: Institutional Strenethening of STATIN (a) Enabling STATIN's managers and technical staff to participate in learning programs for skills upgrading and development aimed at filling the identified skills gaps. (b) Enhancing the credibility of official statistics by engaging the public about the data process. (c) Developing and implementing communications strategies to inform the public about the process of compiling and disseminating official statistics. Part III: Strengthening of National Statistical System (a) Translating key elements of the SMP into sector-specific implementation plans. comprising specific action plans, to support the Recipient's ministries, departments and agencies in improving their statistical processes. (b) Conducting interim half-year stakeholder meetings to monitor and evaluate the results. (c) Developing a national system of statistical indicators as a monitoring and evaluation framework for measuring. monitoring and evaluating the Recipient's progress in meeting development goals and targets. (d) Improving the mechanisms for collecting, compiling and integrating the administrative and vital statistics within the framework of national official statistics. Pa-e 6 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT NOTES TO THE STATEMENT OF SOURCE AND USE OF FUNDS - (CONT'D) THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 B. SIGNIFICANT ACCOUNTING POLICIES: i. Basis of Presentation: - The Statement of Source and Use of Funds has been prepared using the modified cash basis of accounting, recognising revenue when the cash is received and recognising expenses when the cash has been disbursed. This accounting policy is another comprehensive basis of accounting other than generally accepted accounting principles, under which transactions should be recorded when they occur and not when they are received or paid. ii. Currency: - The project's accounting records are maintained in Jamaican (JA) dollars. To calculate the US dollar equivalent. for the eligible expenditures made in local currency, the rate of exchange used is the Bank of Jamaica rate that is in effect at the time the funds were transferred from the designated US dollar account. The foreign exchange rate gain or loss that results from a difference in the exchange rate when the funds are transferred to the designated account versus when the funds are withdrawn from the designated account is accounted for as an exchange rate differential. which is borne by the project implementing entity, STATIN. C. PROJECT FINANCING: The total project cost was estimated at Three Hundred and Forty Six Thousand Five Hundred United States of America dollars (US$346,500) to be funded as follows: US$ International Bank of Reconstruction and Development Bank (IBRD) 346,500 346,500 D. DESIGNATED ACCOUNT In accordance with the IBRD Disbursement Guideline for Grant No. TF095366 a designated account was established. wNith the National Commercial Bank Jamaica Limited in United States Dollar (USD) currency. Page 7 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT NOTES TO THE STATEMENT OF SOURCE AND USE OF FUNDS - (CONT'D) THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 E. AVAILABLE CASH BALANCE: As of 31st December 2014, the available cash balance in the Project's bank account was: US$ Bank Account No. 234289985 9.245 The Statistical Institute of Jamaica (STATIN) was reimbursed the sum of US$128,090 in withdrawals from the designated account during the period ended December 2014. Bank charges incurred were US$67. There was no interest income earned on the account. F. WITHDRAWAL PENDING JUSTIFICATION At 31st December 2014, US$40,686.93 was pending receipt ofjustification from the IBRD. This amount was reimbursed to the Statistical Institute of Jamaica (STATIN) from the designated account but documents are to be submitted to the World Bank. This amount represents withdrawal number 6 and withdrawal number 7 from the designated account. G. PENDING JUSTIFICATION/REIMBURSEMENT At 31st December 2014, the amount set out below was receivable from the IBRD. This represents disbursement request number 9 from the IBRD which was pending. Payments were advanced by the Beneficiary and the ultimate reimbursement will be made to that Institution. The details are as follows: Contract Title Amount Consultants' Services US$ 60,887 H. PENDING EXPENDITURE At 31st December 2014, the following amount was not yet disbursed for this category of investment. Contract Title Amount Audit Services US$ 4.596 STATISTICAL INSTITUTE OF JAMAICA GRANT NO. TF095366 TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT SUPPLEMENTARY INFORMATION TO THE STATEMENT 7- OF SOURCE AND USE OF FUNDS THIRTY-FIVE (35) MONTHS ENDED 31st DECEMBER 2014 INDEX SUPPLEMENTARY STATEMENTS The Integrated Review of the Procurement Process and Withdrawal Requests Submitted 1 Compliance with Financial and Accounting Contractual Clauses and the Project's Regulations 2 - 2d Reconciliation by Categories of Investment 3 Withdrawal Request Application 4 Designated Account Reconciliation 5 VH Dawgen Cartered Accountants Incorporating Paul Goldson & Co. Statement I REPORT OF THE AUDITORS ON THE INTEGRATED REVIEW OF THE PROCUREMENT PROCESS AND WITHDRAWAL REQUESTS SUBMITTED TO THE MANAGEMENT OF STAT ISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 We have audited the Statement of Source and Use of Funds as at 31st December 2014 and the Statement of Cumulative Investments for the thirty-five (35) months ended 31st December 2014, for Grant TF095366 JA-TFSCB for Strategic Statistical Development Project, entered into with the International Bank for Reconstruction and Development, executed by the Statistical Institute of Jamaica under a subsidiary agreement with the Ministry of Finance and the Public Services and have issued our report thereon. In relation to our audit. we examined the withdrawal requests and the processes to procure and contract goods, wvorks, and consulting services. performed by the Executing Agency for the thirty-five (35) noiths Ln1ded 31st December 2014. Our audit included verifying the reasonableness of such and the validitv and eligibility of the expenditures submitted by means of the disbursement justifications for that period. We conducted our audit in accordance with International Standards on Auditing, and the International Bank for Reconstruction and Development (IBRD) requirements. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance that the financial statements are free from material misstatements. The audit also included examining, on a test basis, evidence supporting the processes of selecting and contracting goods, works, and services, and the amounts and disclosures in the withdrawal requests submitted that form a part of the Statement of Source and Use of Funds, the Statement of Cumulative Investments and the Statement of Cash Flo\%s for the period examined. In our opinion, the processes to procure and contract works. goods, and ser\:ices wece per'ormed in accordane with the applicable standards, and the documentation supporting the expenditures made that correspond to the disbursement requests for the period tinder examination were fairly presented and represented valid and eligible expenses for the Project. UHY DAWGEN CHAVIRM9CCCOUNTANTS 20th March 2015 A member of UHY[nternational, a network of independent accounting and consulting firms IIIIIIDawgen Pu od o CharteredAccountants Incorporating Paul Goldson & Co. Statemeint 2 REPORT OF THE AUDITORS ON COMPLIANCE WITH FINANCIAL AND ACCOUNTING CONTRACTUAL CLAUSES AND THE PROJECT'S REGULATIONS TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 We have audited the accompanying Statement of Source and Use of Funds and the Statement of Cumulative Investments and Statement of Cash Flows for the TFSCB For Strategic Statistical Development Project, executed by the Statistical Institute of Jamaica (STATIN) under a subsidiary agreement with the Ministry of Finance and the Public Services. and financed with funds from the International Bank for Reconstruction Development (IBRD) Grant No. TF095366 for the thirty-five (35) months ended 31st December 2014 and have issued our report thereon. We have examined Articles one (1) to ten (10) of the IBRD General Conditions. We are satisfied with cofpl;ance with the financial and accounting contractual clauses and articles within the General Conditions of the Contract Grant No. TF095366 and the IBRD General Conditions, and compliance with the applicable provisions of the subsidiary agreement. We conducted our audit in accordance with International Standards on Auditing and the requirements of the International Bank for Reconstruction and Development. Those standards require that we plan and perform the audit to obtain reasonable assurance that the Statistical Institute of Jamaica has complied with the pertinent loan contractual clauses, applicable laws and regulations. The audit also included examining, on a test basis. the appropriate evidence. We believe that our audit provides a reasonable basis for our opinion. In our opinion, for the thirty-five (35) months ended 31st December 2014, The Statistical Institute of Jamaica complied. in all material respects, with the financial and accounting contractual clauses of the Contract for TFSCB For Strategic Statistical Development Project, Grant No. TF095366 and with applicable laws and regulations. NY Dawgen UHY DAWGEN CHARTERED ACCOUNTANTS 20th March 2015 A member of UHYinternational, a network of independent accounting and consulting firms Statement 2a REPOR'[ OF THE AUDITORS ON COMPLIANCE WITH FINANCIAL AND ACCOUNTING CONTRACTUAL CLAUSES AND THE PROJECT'S REGULATIONS TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) NIONTIIS ENDED 31ST DECEMBER 2014 GENEIL CONDITIONS ARTICLE NUMBER SECTION NAME COMMENTS Article 1 1.01 - 1.04 Introductory Provisions Provisions of the General Conditions were applied in the Project. No inconsistencies or contradictions between the Annexes. Guidelines or General Conditions werc noted. Article 2 2.01 - 2.08 Withdrawals 2.01 Loan Account: Withdrawals Withdrawals of the Grant funds reimbursed to the Project Executing Agency Generally; Currency of Withdrawal (STATIN) through the Recipient (MOF) were done in accordance with IBRD's disbursement guidelines. A Segregated Designated Account was established in the United States of America dollar (USD) currency. The method of disbursement was by reimbursements of payments made by STATIN. 2.02 Special Commitment b\ the Bank This clause was not applicable to this Project. 2.03 Applications for Withdrawal or for Applications for withdrawals from the designated account were done in Special Commitment accordance with the IBRD's disbursement procedures. 2.04 Designated Accounts A Segregated Designated Account was established in USD currency. Deposits into and payments out of the account were in accordance with the loan agreement. 2cneral conditions and the IBRD's disbursement procedures. Statement 2h REPORT F FTHE A UDITORS ON CONIPLIANCE WITHI FINANCIAL AND ACCOUNTING CONTRACTUAL CLAUSES AND THE PROJECT'S REGULATIONS TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMA ICA TF095366- JA:TFSCB FOR STRA TEGIC STATISTICAL DEVELOPMENT PROJECT TIIIRTY-FIVE (35) MONTIIS ENDED 31ST DECEMBER 2014 GENERAL CONDITIONS NI 113ER SECTION NAME COMNIENTS 2.05 Eligible Expenditures The withdrawal of the grant procceds were to finance "Eligible Expcnditure" as required in the loan agrcment. 2.06 Financing Taxes The taxes financed out of the grant proceeds were as a result of eligible eXpCn(liture for ihe consultants' service category of expenditure. No notice was recived by Ihe recipient or project implemienting entity of adjustlenits by IBR D to ihe perecentage of'such Eligible Expenditures to be financed out of ihe procceds of ihe grant as specified in the Loan Agreement. 2.07 Refinancing Preparation Advaince: This clause was not applicable to this Project. Capitalizing lront-en( Fee and Interest 2.08 Reallocation There was no realloCation of the amounts of ie grant to the categories of cxpcndiiiirc is specified in the Loan Agreemeni. Aride 3 3.0 - 3.10 L oan Telms This clanse wais not ippi licable to this Project. Aliele 1 4.01 4.05 Conversions of Loan Tienis This clause was not applicable to this Project. Statemenit 2 REPORT OF TIIE AUDITORS ON COM PLJANCE WITH FINANCIAL AND ACCOUNTING CONTRACTUL CLAUSES AND TIE PROJECTS OPERATIONS REGJLATIONS TO TIE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPIMENT PRO.JECT T11RTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 GENERAL CONDITIONS ARTICIE NJMBER SECTION NAME COMMENTS Artiele 5 5.01 -5.12 Project Exeeution 5.01) Project Execution Generally The project was executed by Ilie Project Implementing Entity in accordance with the conditions of the Subsidiarv Agreenient. .02 Perlrnancc under Ilie Loan The conditions of the Subsidiary Agreenent were subjected to the conditions Agreenient and Project Agreement of the Grant agreement. Perfiiancc by the Projeci Implementing Entity were in accordance with te agreements. 5.0.- Provision of Funds and other The funds reimbursed for eligible ependiture to the Project implementing Resources Entity were deposited to Ilie designated account by the 113RD as requested. s0.1 Insurance No insurance of any goods was required under Ilie project. 5 and Acquisition No land was acquired under Ilie projeet. 5.06 ise of Goods. Works and Services: All goods. works and services linanced out of the procceds of the grant were Maintenancc of Facilitics used exclusively for ilie purposes of tie Projet. 5.07 Plans: Documen ts; Records An appropriate system of internal accouni and idiiiinistrative controls was establislied. 5.11, Project Monitoring and Evaliation The projeet was ioniiored in accordancc u ih e conditions of te Subsidiary Agreeient. Statement 2d REPORT OF THE AUDITORS ON COMPLIANCE WITH FINANCIAL AND ACCOUNTING CONTRACTUAL CLAUSES AND TIE PROJ ECI'S OPERAION'S REGULATIONS TO '11 MANAGEMENT OF STATISTICA INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT THIRTY-FIVE (35) MONTHS ENDED 31STI DECEMBER 2014 GENERAL CONDITIONS ARTICLE NUMBER SECTION NAME COMMENTS Article 5 (Contd) 5.09 Financial Management: I inincial An appropriate system of internal accounting and administiative controls was Statements: Audits established. The project vas audited at the end of the thirt\ fhe (35) months. 5.10 Cooperation and Consultation Active cooperation and consultation was maintained between the IBRD recipient and project implementing Agency (STATIN) during the period. 5.11 Visits ihe Project Implementing Agency facilitated a Financial Management Supervison visit by representatives of the International Development Bank (113RD) on 9th January 2014 and 30th September 2014. 5.12 Disputed Area There were no disputed area of the project. Article 6 6.01 - 6.02 Financial and Economic Data: 'I his clause was not applicable to this Project. Article 7 7.01 - 7(t)8 Cancellation: Suspension: There was no cancellation of requests for grant funding under the project by Acceleration the recipient or implementing agency or suspension of the project by the IB3RD. Article 8 8.01 - 8.04 Enforecability: Arbitration There were no legal matters arising between parties. AI ti.ce 9 9.01 - 9.15 Effectiveness:'Termin ation The contractual agreement between the Miniistry of FiMnanc and the Public Services and the IBRD became effective May 18. 2011. Article 10 10.01 - 10.05 Miscellaneous Pro\ isions Tle project was carried out in accordance with tile provisions of the staidard conditions. Statement 3 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT RECONCILIATION BY CATEGORIES OF INVESTMENT THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 AMOUNT OF PENDING WITHDRAWAL GRANT APPROVED JUSTIFICATION/ PENDING CATEGORIES ALLOCATED DISBURSEMENTS AVAILABLE REIMBURSEMENT JUSTIFICATION BALANCE US$ US$ US$ US$ US$ US$ 1.0 Consultants' Services 174,000 - 174,000 60,887 26,504 86,609 2.0 Training 172,500 158,317 14,183 - 14,183 - GRAND TOTAL 346,500 158,317 188,183 60,887 40,687 86,609 Statement 4 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT WITHDRAWAL REQUESTS THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 WITHDRAWAL REQUEST DATE AMOUNT AMOUNT NUMBER SUBMITTED REQUESTED APPROVED US$ US$ 1 December 31, 2012 46,087 46,087 2 September 10, 2013 3,357 3,357 3 December 13, 2013 10,452 10,452 4 March 31, 2014 1,357 1,357 5 September 15, 2014 26,151 26,151 6 October 3, 2014 9,530 9,530 7 December 18, 2014 31,157 31,157 128,090 128,090 Statement 5 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT DESIGNATED ACCOUNT RECONCILIATION THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 DESCRIPTION AMOUNT US$ Designated Account Opening Balance as at 1st December 2012 Receipts 137,402 Withdrawals (128,090) Bank Charges (67) Designated Account Closing Balance as at 31st December 2014 9,245 Balance as per Bank Statement as at 31st December 2014 9,245 K STATISTICAL INSTITUTE OF JAMAICA GRANT NO. TF095366 TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT SYSTEM OF INTERNAL CONTROLS THIRTY-FIVE (35) MONTHS ENDED 31st DECEMBER 2014 INDEX NOTES ON INTERNAL CONTROL REPORT OF THE AUDITORS TO THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT 1 - la Internal Control Weaknesses 2 Recommendations 3 F- Dawgen U H Chartered Accountants Incorporating Paul Goldson & Co. Corporate Head-Office Unit 34 Winchester Business Centre 15 Hope Road Kingston 10 Jamaica, W.I. Phone +876-9084007 Fax +876-7540380 REPORT OF THE AUDITORS Email info@uhy-ja.com Web www.uhy-ja.com TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT REPORT ON INTERNAL CONTROL THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 We have audited the accompanying Statement of Source and Use of Funds and the Statement of Cumulative Investments and Statement of Cash Flows for the TFSCB For Strategic Statistical Development Project, executed by the Statistical Institute of Jamaica (STATIN) under a subsidiary agreement with the Ministry of Finance and the Public Services, and financed with funds from the International Bank for Reconstruction Development (IBRD) Grant No. TF095366 for the thirty-five (35) months ended 31st December 2014 and have issued our report thereon. We conducted our audit in accordance with International Standards on Auditing, and the International Bank for Reconstruction and Development (IBRD) requirements. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance that the financial statements are free from material misstatement. The Statistical Institute of Jamaica Grant No. TF095366 TFSCB For Strategic Statistical Development Project is responsible for establishing and maintaining a system of internal control. In fulfilling this responsibility, estimates and judgements by management are required to assess the expected benefits and related costs of the internal control system policies and procedures. The objectives of a system of internal control are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition; transactions are executed in accordance with management's authorization and in accordance with the terms of the contract; and transactions are recorded properly to permit the preparation of the Statement of Source and Use of Funds and the Statement of Cumulative Investments, in conformity with the modificed cash basis of accounting. Because of inherent limitations in any system of internal control, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. LOCATIONS: Oxford House Shop 28 (Upstairs) Shop EU6 Shop C1 2nd Floor Caledonia Mail Whitter Village 1018 Main Street 6 Oxford Road Mandeville Montego Bay Ocho Rios Kingston 5 Manchester StJames St. Ann T: +876-9263562 T: +876-9626369 T: +876-9533793/9538486 T: +876-9748772 F: +876-9291300 F: +876-7540380 F: +876-9533058 F: +876-9745373 E: infobranch@uhy-ja.com E: infobranch@uhy-ja.com E: infobranch@uhy-ja.com E: infobranch@uhy-ja.com A member of UHYInternational, a network of independent accounting and consulting firms U'H"'Dawgen Chartered Accountants Incorporating Paul Goldson & Co. Page Ia REPORT OF THE AUDITORS TO THE MANAGEMENT OF STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT REPORT ON INTERNAL CONTROL - CONT'D THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 In planning and performing our audit of the program's financial statements for the thirty-five (35) months ended 31st December 2014, we obtained an understanding of the system of internal control. With respect to the system of internal control, we obtained an understanding of the design of relevant policies and procedures and whether they have been in operation, and we assessed control risk in order to determine our auditing procedures for the purpose of expressing our opinion on the project's financial statements and not to provide an opinion on the system of internal control. Accordingly, we do not express such an opinion. We noted certain matters involving the system of internal control and its operation that we consider to be reportable conditions under International Standards on Auditing. These are described on pages 2 - 3 of System of Internal Controls. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of system of internal control that in our judgement, could adversely affect the ability of the Grant TF095366 TFSCB For Strategic Statistical Development Project to record, process, summarize, and report financial data consistent with the assertions of management in the Statement of Source and Use of Funds and the Statement of Cumulative Investments. A material weakness is a reportable condition in which the design or operation of one or more of the specific elements of the system of internal control does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the program's financial statements may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our considerations of the system of internal control would not necessarily disclose all matters in the system of internal control that might be reportable conditions, and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. Uf kiwen UHY DAWGEN CHARTWD ACCOUNTANTS 20th March 2015 A member of UHYInternational, a network of independent accounting and consulting firms Page 2 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT NOTES ON INTERNAL CONTROL THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 INTERNAL CONTROL WEAKNESSES During the process of our evaluation the following internal control weaknesses were noted: (i) It was noted that a number of the project's eligible expenditures incurred during the period 2012 were posted to the project implementing agency (STATIN's) general ledger accounts. These were later transferred via journal entries to the Project's IBRD Trust Fund for Statistical Capacity Building general ledger accounting records. (ii) It was also observed that the general ledger balance was not complete as three (3) expenditures totalling USD 2,250.68 were not posted to the project's accounts but were still in STATIN's general ledger. (iii) Based on the accounting records the total expenditure under 1he project was USS265,235.03. Total amount requested for reimbursement fiom the designated account was US$199,004.12 and US$60,886.94 in outstanding withdrawals. US$5,343.97 was absorbed by the project's implementing agency (STATIN) however, these amounts were still in the Project's general ledger accounts. (iv) Annual audited financial statements were not prepared for the Project but rather one (1) audit to cover the two (2) years of the project. No letter of non-objection, in this regard, was seen fi-om the International Bank for Reconstruction Development (IBRD). Page3 STATISTICAL INSTITUTE OF JAMAICA TF095366- JA:TFSCB FOR STRATEGIC STATISTICAL DEVELOPMENT PROJECT NOTES ON INTERNAL CONTROL THIRTY-FIVE (35) MONTHS ENDED 31ST DECEMBER 2014 RECOMMENDATIONS (i) The Project implementing agency (STATIN) should ensure that all expenditures incurred under the project are posted to the project's accounting records in a timely manner. (ii) The agency should ensure that all transactions are recorded in the general ledger to facilitate proper accounting and financial reporting. (iii) The expenditure to be absorbed by the Agency should be posted to its general ledger prior to the close of its financial year to ensure accurate financial reporting. (iv) Proper record keeping of all communications with the IBRD is necessary ensure that all information and records are properly maintained for future reference. I I-