REPUBLIC OF SIERRA LEONE

GENERAL PURPOSE FINANCIAL STATEMENTS (GPFS)

o STATUTORY ANNUAL FINANCIAL STATEMENTS o IN YEAR FINANCIAL REPORTS o ACCOUNTING POLICIES

ISSUED BY

THE ACCOUNTANT GENERAL, MINISTRY OF FINANCE (MOF)

TO BE USED BY

o THE GOVERNMENT OF SIERRA LEONE (GOSL) o SUB-VENTED AGENCIES AND OTHER GOSL ENTITIES

April 2018

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Table of Contents Forward by the Minister – MOF ................................................................................................. 2

Statement by the Accountant General ..................................................................................... 3

List of Abbreviations/Acronyms ................................................................................................ 4

Accounting Terminologies / Definitions ................................................................................. 4

A. Introduction ............................................................................................................................. 6

B. Cash Basis IPSAS ..................................................................................................................... 6

C. Components of the General Purpose Financial Statements ................................... 7

D. Statutory Financial Reporting Requirements (as per the Public Financial Management Act, 2016) ................................................................................................................ 9

E. General Purpose Financial Statements – Statutory Annual Financial Statements ....................................................................................................................................... 11

I. Forward Note by the Minister/Chairman/Commissioner ............................... 11

II. Statement of Management Responsibilities .............................................................. 12

III. Format – Statement of Cash Receipts and Payments – General/Consolidated Fund ................................................................................................. 13

IV. Format – Statement of Cash Receipts and Payments – Capital Development Projects ............................................................................................................ 14

V. Format – Statement of Comparison of Budget and Actual Amounts ........... 15

VI. Format – Statement of Cash Balances ................................................................. 16

VII. General Information about the Reporting Entity ............................................ 17

VIII. Standardized Statement of Accounting Policies.......................................... 18

IX. Explanatory Notes to the Accounts ...................................................................... 22

X. Additional Disclosures – Memorandum Statements .......................................... 23

a) Format – Statement of Revenues collected during the year (Based on source of revenue and detailed line item accounts code) ................................... 23

b) Format – Statement of Arrears of Revenues at end of the financial year (Based on source of revenue and detailed line item accounts code) .............. 23

c) Format – Statement of Payments by Programs/Activities ..................... 24

d) Format – Statement of Outstanding Commitments ................................... 24

e) Format – Statement of Fixed (Physical) Assets Purchased During the Year 25

f) Format – Statement of Disposal of Fixed (Physical) Assets During the Year ........................................................................................................................................... 26

g) Format – Statement of Undrawn External Assistance .............................. 26

h) Format – Statement of Contingent Liabilities .............................................. 27

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Forward by the Minister – MOF I am extremely pleased to present to you this GPFS formats which promotes stewardship ,transparency and accountability across public sector entities of the central government. In that regard standardising financial reporting across central government is highly considered as a significant step in ensuring quality and reliant financial governance to support the ‘New Direction’ quest for economic transformation and efficient service delivery.Inotherwords,this will forster effective management of our meagre public sector resources in compliance with the PFM Act 2016. The practice of using this standardised GPFS format in producing regular financial reports as required by the PFM Act 2016 is of great importance to the new government.Reforms of this nature do have far reaching implications in restoring public confidence in the utilisation of public funds. It is noted however that this may present some new challenges for some of the public sector entities but we are fully committed to provide support and guidance to these entities on the regularity and quality of financial reports being produced. I will like to thank all stakeholders who have significantly contributed towards the development and finalisation of this template most importantly the EU state building project in collaboration with the Accountant General’s Department. I will want to particularly encourage the Accountant General’s Department to facilitate it full implementation and I look forward to it successful implementation. Jacob Jusu SaffaMinister Ministry of Finance (MOF) April 2018

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Statement by the Accountant General The Government of Sierra Leone has formally adopted the International Public Sector Accounting Standard Financial Reporting under the Cash Basis of Accounting (termed ‘Cash Basis IPSAS’). The Cash Basis IPSAS being adopted by the Government of Sierra Leone is aimed for application to the General Purpose Financial Statements (GPFS) of all public sector entities other than Government parastatals or state owned enterprises. The parastatals are commercial entities expected to apply other suitable internationally accepted accounting standards. These along with the Public Financial Management (PFM) Act, 2016 demonstrate the Government’s commitment to a very strong PFM Reform that will drive upward transparency and accountability. With financial transactions being generally common across the public sector, I fervently believe that the development of improved and standardised financial statements within Government will ensure improvement in transparency and accountability in the utilisation of public resources. These will prescribe the manner in which GPFS should be presented to ensure comparability both with the entity’s financial statements of previous periods and with the financial statements of other entities. Furthermore, information is provided on the cash flows of an entity and available cash balance at the end of the reporting period that is useful to a wide range of users in making and evaluating decisions about the allocation of resources. Specifically, the objectives of GPFS in the public sector should be to provide information useful for decision-making, and to demonstrate the accountability of the entity for the resources entrusted to it. I acknowledge and appreciate with utmost sincerity the efforts put forward by all stakeholders contributing to the development of this set of financial reporting template. Let me particularly thank the European Union and the World Bank that through development projects controlled by them provided financial and technical support in putting this document together. I want to also thank the IPSAS Board of the International Federation of Accountants (IFAC) for the development of the Cash Basis IPSAS and for their generosity in allowing us to adopt it as an accounting standard for the Government of Sierra Leone and all public sector entities in Sierra Leone. Richard S. WilliamsAccountant General April 2018

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List of Abbreviations/Acronyms

Abbreviation/Acronym Description

AGD Accountant General's Department

COA Chart of Accounts

FY Fiscal Year

GBE Government Business Enterprise

GOSL Government of Sierra Leone

GPFS General Purpose Financial Statements

IPSAS International Public Sector Accounting Standards

MDA Ministries, Departments and Agencies

MOF Ministry of Finance

PFM Public Financial Management

Accounting Terminologies / Definitions

Accounting Terminolgies / Definitions:

I. Accounting policies are the specific principles, bases, conventions, rules and practices adopted by an entity in preparing and presenting financial statements.

II. Annual budget means an approved budget by the legislative body (House of Parliament) for a period of one fiscal year. It does not include published forward estimates or projections for periods beyond the budget period.

o Final budget is the original budget adjusted for all approved carry over amounts, transfers, allocations, supplemental appropriations, and other authorized legislative or similar authorized changes applicable to the budget period.

o Original budget is the initial approved budget for the budget period. III. Appropriation is an authorization granted by the legislative body to allocate funds for

purposes specified by the legislature or similar authority. IV. Approved budget means the expenditure authority derived from laws, appropriation

bills, government ordinances and other decisions related to the anticipated revenue or receipts for the budgetary period.

V. Cash: Cash comprises cash on hand, demand deposits and cash equivalents. o Cash equivalents are short-term, highly liquid investments that are readily

convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Generally, they exclude equity investments.

VI. Cash basis means a basis of accounting that recognizes transactions and other events only when cash is received or paid.

o Cash receipts are cash inflows. o Cash payments are cash outflows.

VII. Cash Controlled by an entity: Cash is controlled by an entity when the entity can use the cash for the achievement of its own objectives or otherwise benefit from the cash and excludes or regulates the access of others to that benefit. Cash collected by, or appropriated or granted to, an entity which the entity can use to fund its operating objectives, acquire capital assets or repay its debt is controlled by the entity.

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Accounting Terminolgies / Definitions:

VIII. Contingent Liabilities: A potential liability that depends on a future event occurring or not occurring that is outside the control of the entity. An example is a case that is before the courts of law whose outcome is not yet known – a Legal proceeding. Contingent Liabilities will also include Guarantees issued out.

o Legal Proceedings: A case or cases that is/are before the courts of law yet to be decided on. This includes all cases where the government has been sued and/or being sued for monetary compensation.

o Guarantees: an undertaking to answer for the payment or performance of another person's debt or obligation in the event of a default by the person primarily responsible for it.

IX. Explanatory Notes to the General Purpose Financial Statements (GPFS) include narrative descriptions or more detailed schedules or analyses of amounts shown on the face of the GPFS, as well as additional essential information

X. Fixed (Physical) Assets are those assets that are fully functioning unit of property, plant & equipment (PPE) with an acquisition cost of at least Le500,000, and which by its nature has a useful life extending over more than one financial year.

XI. General purpose financial statements or financial reports are those intended to meet the needs of users who are not in a position to demand reports tailored to meet their particular information needs. Users of general purpose financial statements include taxpayers and ratepayers, members of Parliament, creditors, suppliers, the media, and employees.

XII. Government Business Enterprise (GBE) or Parastatal or State Owned Enterprise means an entity that has all the following characteristics:

a) Is an entity with the power to contract in its own name; b) Has been assigned the financial and operational authority to carry on a business; c) Sells goods and services, in the normal course of its business, to other entities at a

profit or full cost recovery; d) Is not reliant on continuing government funding to be a going concern (other than

purchases of outputs at arm’s length); and e) Is controlled by a public sector entity.

GBEs include both trading enterprises, such as utilities, banks and other financial institutions that are, in substance, no different from entities conducting similar activities in the private sector.

XIII. Materiality: information is material if its omission or misstatement could influence the decisions or assessments of users made on the basis of the financial statements. Materiality depends on the nature or size of the item or error judged in the particular circumstances of omission or misstatement. Thus, minor events may be ignored but major ones should be disclosed

XIV. Reporting date means the date of the last day of the reporting period to which the financial statements relate.

XV. Reporting Entity is any public sector entity, namely - Ministry, Department or Agency (Subvented or Budgetary or other public sector entities),- required under the PFM Act 2016 to prepare general purpose financial statements or financial reports.

XVI. Undrawn external assistance loans and grants are amounts specified in a binding agreement which relate to funding for projects currently under development, where conditions have been satisfied, and their ongoing satisfaction is highly likely, and the project is anticipated to continue to completion.

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A. Introduction

In line with the new PFM Act, 2016 and the adoption of the cash basis

International Public Sector Accounting Standards (IPSAS) by the Government of

Sierra Leone, a set of Financial Statements template have been designed and

introduced for adoption by budgetary agencies, sub-vented agencies, other

entities in the central government, In effect it covers all public sector entities,

excluding local government and parastatals or state owned enterprises. Section

83 of the Act requires that the Accountant General should specify the

international accounting standard to be used in the preparation of financial

statements for public sector entities.

The Financial Statements templates have been designed to ensure uniformity in

the accounting and reporting of transactions in all public sector entities in Sierra

Leone, and also to ensure compliance with the regulatory framework and the

cash basis IPSAS that has been adopted by the Government of Sierra Leone. The

templates for the monthly, quarterly and annual reporting as required by the

new PFM Act, 2016, have been designed to ensure that all budgetary agencies

financial transactions are prepared and published in the government Gazette and

the website of the Ministry timely and consistently.

The set of financial statements template covers all the necessary information

that each reporting entity should include when they make the submissions and

when they make public such reports. It includes the accounting policies that are

applied in the accounting and recording of transactions and the accompanying

explanatory notes to make the reports more easily understood for the purpose of

transparency and accountability. The accounting policies are applicable to all

public sector entities of the Government of Sierra Leone. The accounting policies

and the notes shall form part of the financial report of each of the reporting

entities under this guidance.

These policies shall form part of the government wide agreed framework for

financial accounting and reporting in Sierra Leone.

B. Cash Basis IPSAS Financial statements under the cash basis show the sources of cash raised during the period, the purposes for which cash was used, and the cash balances at the reporting date. These will include a statement of cash receipts and payments recognises all cash receipts, cash payments, and cash balances controlled by the entity.

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In effect, the cash basis of accounting recognizes transactions and events only when cash (including cash equivalents) is received or paid by the entity. Financial statements prepared under the cash basis provide readers with information about the sources of cash raised during the period, the purposes for which cash was used and the cash balances at the reporting date. The measurement focus in the financial statements is balances of cash and changes therein. Notes to the financial statements may provide additional information about liabilities, such as payables and borrowings, and some non-cash assets, such as receivables, investments and property, plant and equipment. In using the Cash Basis Accounting System, transactions should generally be accounted on a gross basis. Accounting on a net basis is allowed for special types of transactions, like administered and agency transactions, and items in which the turnover is quick, the amounts are large, and the maturities are short. This also includes proceeds from trading activities were are government is involved in trading, the proceeds will have to be reported on a net basis. When the entity makes its approved budget publicly available, most of the requirements from IPSAS 24 apply, including an explanation of material differences between the budget and actual amounts and an explanation of whether differences between original and final budget are virements or other changes. C. Components of the General Purpose Financial Statements General purpose financial statements should present information that is: a) Understandable; b) Relevant to the decision-making and accountability needs of users; and c) Reliable in that it:

i. Represents faithfully the cash receipts, cash payments and cash balances of the entity and the other information disclosed;

ii. Is neutral, that is, free from bias; and iii. Is complete in all material respects.

The quality of information provided in general purpose financial statements determines the usefulness of that statement to users. A complete set of general purpose financial statements comprises: Core Financial Statements

(a) Statement of Cash Receipts and Payments – General/Consolidated Fund, which:

a. Recognizes all cash receipts, cash payments and cash balances controlled by the entity; and

b. Separately identifies payments made by third parties on behalf of the entity. The entity should disclose in separate columns on the face of the statement of cash receipts and payments:

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i. Total payments made by third parties which are part of the

economic entity (the Government of Sierra Leone) to which the reporting entity belongs; and

ii. Total payments made by third parties which are not part of the economic entity to which the reporting entity belongs, that is third parties that are outside of the Government of Sierra Leone.

(b) Statement of Cash Receipts and Payments – Capital Development Projects (c) Statement of Comparison of Budget and Actual Amounts (d) Statement of Cash Balances (e) General Information about the Reporting Entity (f) Accounting Policies and Explanatory Notes

Additional (Memorandum) Financial Statements

(g) Statement of Revenues collected during the year (Based on source of revenue and detailed line item accounts code)

(h) Statement of Arrears of Revenues as at end of the financial year (Based on source of revenue and detailed line item accounts code)

(i) Statement of Payments by Programs/Activities (j) Statement of Outstanding Commitments (k) Statement of Fixed (Physical) Assets Purchased During the Year (l) Statement of Disposal of Fixed (Physical) Assets During the Year (m) Statement of Undrawn External Assistance (n) Statement of Contingent Liabilities

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D. Statutory Financial Reporting Requirements (as per the Public Financial

Management Act, 2016) The following present the Statutory Requirements under the Public Financial Management (PFM) Act, 2016 for financial reporting in all public sector entities other than state owned enterprises. In year Budget Execution Reports: In year reports for the consolidated fund must be prepared by the Accountant General and published in the Gazette and on the website of the Ministry every month - Section 66 (1) Furthermore, public sector entities within the central government are required to prepare quarterly budget execution reports, as follows:

Central Government – Accountant General to prepare and publish in the Gazette and on the website of the Ministry (Section 66 (2))

Sub-vented agencies, other entities (including Budgetary Agencies) in the central government and social security funds the vote controller to prepare and submit to the Minister and responsible authority (Section 112)

Annual Financial Statements: Annual financial statements for the Consolidated Fund, budgetary agencies, sub-vented agencies and other entities in the central government to be prepared and submitted to the Auditor General within three months after the end of the financial year (Sections 83, 86(1) and 87 (1)) The Accountant General to publish the annual financial statements of the Consolidated Fund in the Gazette and on the website of the Ministry immediately after submitting the accounts to the Auditor General (Section 87 (4)) The audited annual financial statements for the budgetary agencies, sub-vented agencies and other entities in the central government, must be submitted to the Accountant General within nine months of the close of the financial year (Section 86 (2)) The Accountant General to prepare and submit to the Auditor General the annual financial statement of the central government, which covers all entities included in the Central Government within ten months after the end of the financial year (Section 89 (1))

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The Auditor General to submit to the Minister and Parliament and publish in the Gazette and on the Auditor General’s website the audit report on the annual financial statements of the consolidated fund of the financial year within twelve months of the end of the financial year (Section 88 (2)) The Accountant General to submit to the Minister the annual financial statement of the central government for the financial year and the report of the Auditor General, within twelve months of the end of the financial year (Section 89 (2)). The Minister to lay the audited annual financial statements of the central government and the audit report before Parliament and publish them in the Gazette and the website of the Ministry (Section 89 (3)). Summary – Legislative Provisions for Financial Reporting

In year Budget Execution Reports - Legislative

Provisions

Annual Financial Statements – Legislative Provisions and Timeline for

submission Responsibility

Section 66 (1) Monthly reports – Accountant General to prepare and publish in the Gazette and Ministry Website

Sections 83, 87 and 88 Submission to Auditor General through the Minister of Finance, and publishing in the Gazette and on the website of the Ministry of Finance: 3 months after end of Financial Year. Section 88(2) Auditor General to submit the audit report on the accounts of the Consolidated Fund to the Minister of Finance and Parliament within 12 months of the end of the financial year.

Accountant General Auditor General

Section 66 (2) & (3) Quarterly budget execution reports – For (a) Accountant General to prepare and publish in the Gazette and Ministry Website; and (b) Minister to submit to Parliament for its information

Section 83/Section 89 (a) Submission to Auditor General: 10 months after end of Financial Year, Accountant General to prepare and submit annual financial statements of the central government, covering all entities included in the central government. (b) Accountant General to submit the audited financial statements of the central government together with the audit report, to the Minister of Finance (c) Within 12 months of the end of the financial year, the Minister to lay the audited annual financial statements together with the audit report, before

Accountant General Accountant General The Minister of Finance

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In year Budget Execution Reports - Legislative

Provisions

Annual Financial Statements – Legislative Provisions and Timeline for

submission Responsibility

Parliament and publish on the website of the Ministry.

Section 112(1) Quarterly budget execution reports – For Every Vote Controller and Head of Entity to prepare and submit to the Minister of Finance and the responsible authority

Section 83/Section 86 (3) To Auditor General: 3 months after end of Financial Year. To Accountant General: Audited Financial Statements to be submitted within nine months of the end of the financial year.

Vote Controller

Section 83/Section 86 (3) To Auditor General: 3 months after end of Financial Year. To Accountant General: Audited Financial Statements to be submitted within nine months of the end of the financial year.

Vote Controller

E. General Purpose Financial Statements – Statutory Annual Financial

Statements

I. Forward Note by the Minister/Chairman/Commissioner

A Forward Note should be provided issued by the Minister/Chairman/ Commissioner of the public sector entity, and this should include the following:

Mention the budget performance against actual amounts for current

year,

Physical progress based on outputs, outcomes and impacts on the MDA

during the financial year,

Comment on value-for-money achievements,

List the implementation challenges of strategic objectives for the MDA

and recommended way forward.

Sign MINISTER/CHAIRMAN/COMMISSIONER MDA

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II. Statement of Management Responsibilities The vote controller confirms that the Financial Statements have been prepared in accordance with the provisions of the Public Financial Management Act of 2016 and in compliance with the International Public Sector Accounting Standard: Financial Reporting under the Cash Basis of Accounting (Cash Basis IPSAS), adopted by the Government of Sierra Leone. Sections 86 of the Public Financial Management Act, 2016, requires that within three months after the accounts of the financial year are closed, the vote controller of every entity of sub-vented agency, and every other entity in the central government, , shall submit to the Auditor General annual financial statements of the entity for the financial year. The vote controller is responsible for the preparation and presentation of the public sector entity’s financial statements, which give a true and fair view of the state of affairs of the entity for and as at the end of each financial year. This responsibility is stipulated in Sections 13 and 15 of the Public Financial Management Act, 2016, includes: (i) maintaining efficient and effective systems of financial management and internal controls; (ii) safeguard and manage assets and public money of the entity in the best interest of the entity with the due care and diligence; (iii) keep full and proper records of the financial affairs of the entity; and (iv) submit in a timely manner financial reports, accounts and statements of the entity. The vote controller is of the opinion that the public sector entity’s financial statements give a true and fair view of the state of the public sector entity’s transactions during the financial year-end. The vote controller confirms that the public sector entity has complied fully with applicable Government Regulations, and that the funds received during the year under review were used for the eligible purposes for which they were intended and were properly accounted for. The vote controller also confirms the adequacy of the system of internal controls. Further, the vote controller confirms that in preparing the Financial Statements, the most appropriate accounting policies have been consistently applied and supported by reasonable and prudent judgment and estimates. The vote controller further confirms to the best of his/her knowledge and belief the completeness of the accounting records maintained and that the Financial Statements agree with the books of accounts, which have been properly kept. The vote controller accepts responsibility for the integrity of the financial statements, the financial information they contain and their compliance with the provisions of Section 15 (4) of the Public Financial Management (PFM) Act of 2016. Approval of the financial statements The financial statements were approved and signed by the undersigned on ____________ 20XX. ___________________________________ Vote Controller Date

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III. Format – Statement of Cash Receipts and Payments – General/Consolidated Fund

STATEMENT A

STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR THE YEAR ENDED 31ST DECEMBER 20XX

Amounts in Leones

Note 20XX ! 20XX-1 Receipts/

Payments by the MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

! Receipts/Payments by MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

RECEIPTS ! Authorised Allocation/MOF transfers

XX XX ! XX XX

Transfer from other government units

XX XX ! XX XX

Proceeds from Domestic and Foreign Grants

XX XX XX ! XX XX XX

Other receipts XX XX ! XX XX Tax XX XX ! XX XX Other taxes XX XX ! XX XX Non Tax XX XX ! XX XX Fees XX XX ! XX XX Levy XX XX ! XX XX Other non tax XX XX ! XX XX Proceeds from borrowings ! Local XX XX ! XX XX Foreign XX XX ! XX XX Capital Receipts ! Proceeds from disposal of Assets

XX XX ! XX XX

Trading Activities ! Proceeds from trading activities

XX XX ! XX XX

Other receipts XX XX ! XX XX Total Receipts XX XX XX ! XX XX XX ! PAYMENTS ! Compensation of employees XX XX XX ! XX XX XX Use of goods and services XX XX XX ! XX XX XX Capital/Development Expenditure

XX XX XX ! XX XX XX

Financing Cost – Interest Payments

XX XX XX ! XX XX XX

Repayment of principal on local and foreign loans

XX XX XX ! XX XX XX

Subsidies and Transfers XX XX XX ! XX XX XX Grants XX XX XX ! XX XX XX Social Benefits XX XX XX ! XX XX XX Other payments XX XX XX ! XX XX XX Total Payments XX XX XX ! XX XX XX Surplus/(Deficit) XX XX XX ! XX XX XX Cash at beginning of the XX ! XX

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Note 20XX ! 20XX-1 Receipts/

Payments by the MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

! Receipts/Payments by MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

year Cash at close of the year XX ! XX

The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. The entity financial statements were approved on ___________ 20…… and signed by: _______________________ ________________________ Vote Controller Head of Accounts

IV. Format – Statement of Cash Receipts and Payments – Capital Development Projects

STATEMENT A 1

STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR PROJECTS (DONOR FINANCED) FOR THE YEAR ENDED 31ST DECEMBER 20XX

Amounts in Leones

Note 20XX ! 20XX-1 ! Receipts/

Payments by the MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

! Receipts/Payments by MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

!

RECEIPTS ! ! Authorised Allocation received

XX XX XX ! XX XX XX !

Counterpart funds from Government

XX ! XX !

Other receipts XX ! XX ! Total Receipts XX XX XX ! XX XX XX ! ! ! PAYMENTS ! ! Operations: ! ! Project 1 XX XX XX ! XX XX XX ! Project 1 XX XX XX ! XX XX XX ! Transfers ! ! Project 1 XX XX XX ! XX XX XX ! Project 1 XX XX XX ! XX XX XX ! Development/Capital Expenditure

! !

Project 1 XX XX XX ! XX XX XX ! Project 1 XX XX XX ! XX XX XX ! Total Payments XX XX XX ! XX XX XX ! Surplus/(Deficit) XX XX XX ! XX XX XX ! Cash at beginning of XX ! XX !

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Note 20XX ! 20XX-1 ! Receipts/

Payments by the MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

! Receipts/Payments by MDA/LC

Receipts/Payments by MOF

Receipts/Payments by 3rd Party

!

the year Cash at close of the year

XX ! XX !

V. Format – Statement of Comparison of Budget and Actual Amounts

STATEMENT B

STATEMENT OF DETAILED COMPARISON OF BUDGET AND ACTUAL, REVENUE AND EXPENDITURE FOR THE YEAR ENDED 31ST DECEMBER 20XX

(To be presented at the parliamentary approval level) Amounts in Leones

20XX ! 20XX-1 !

Final Budget

Actual Variance ! Final Budget

Actual !

REVENUE ! ! Tax XX XX XX ! XX XX ! Non tax XX XX XX ! XX XX ! Proceeds from Grants & Loans XX XX XX ! XX XX ! TOTAL REVENUE XX XX XX ! XX XX ! ! ! Compensation of employees (XX) (XX) (XX) ! (XX) (XX) ! TOTAL (XX) (XX) (XX) ! (XX) (XX) ! ! ! Programme1 (XX) (XX) (XX) ! (XX) (XX) ! Programme2 (XX) (XX) (XX) ! (XX) (XX) ! Programme3 (XX) (XX) (XX) ! (XX) (XX) ! Programme4 (XX) (XX) (XX) ! (XX) (XX) ! Programme5 (XX) (XX) (XX) ! (XX) (XX) ! Programme6 (XX) (XX) (XX) ! (XX) (XX) ! Programme7 (XX) (XX) (XX) ! (XX) (XX) ! Programme8 (XX) (XX) (XX) ! (XX) (XX) ! TOTAL (XX) (XX) (XX) ! (XX) (XX) ! TOTAL EXPENDITURE (XX) (XX) (XX) ! (XX) (XX) !

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VI. Format – Statement of Cash Balances

STATEMENT C

STATEMENT OF CASH POSITION (ALL PUBLIC FUNDS) AS AT 31ST DECEMBER 20XX Amounts in Leones Notes 20XX 20XX-1 Change in

Cash Balances

Cash/Bank Account Details Project Name

Currency Held In

GENERAL FUND YY Petty Cash or Imprest XX XX XX MDA/LC Bank Accounts Bank Account(s) – Account Name & Bank Name

XX XX XX

Total held in MDA/LC Bank Accounts: XX XX XX Total MDA/LC Cash and Bank Balances at the end of the period (General Fund):

XX XX XX

CAPITAL (DONOR FINANCED) PROJECTS ZZ Projects Petty Cash or Imprest XX XX XX Project Bank Accounts Bank Account(s) – Account Name & Bank Name

XX XX XX

Total held in Projects Bank Accounts: XX XX XX Total Projects Cash and Bank Balances at the end of the period

XX XX XX

TOTAL CASH AND BANK BALANCES - ALL PUBLIC FUNDS

XX XX XX

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VII. General Information about the Reporting Entity

A Reporting Entity should provide general information about itself so as to enable users to identify the nature of the entity’s operations and gain an understanding of the legislative and institutional environment within which it operates. This is necessary for accountability purposes and will assist users in understanding and evaluating the financial statements of the entity. In that regard, the Reporting Entity should disclose the following information published with the financial statements:

a) The domicile and legal form of the entity; b) A description of the nature of the entity’s operations and principal

activities; c) A reference to the relevant legislation governing the entity’s operations, if

any; and d) The name of the controlling entity and the ultimate controlling entity of

the economic entity (where applicable, if any). The principal address of the reporting entity should be disclosed: MDA Address, City/Town, Sierra Leone.

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VIII. Standardized Statement of Accounting Policies

The Standardised Accounting Policies given below have been developed using

the cash basis of accounting that prescribed how financial transactions are

treated and reported in the general purpose financial statements. These are

developed based on the fundamental principles underlying the preparation of

financial statements, including going-concern assumption, consistency of

presentation and classification, cash basis of accounting, and aggregation and

materiality. They prescribed consistency in the definition, recognition,

measurement and treatment of similar accounting items or financial

transactions.

The Accounting Policies section of the notes to the financial statements should

describe each specific accounting policy that is necessary for a proper

understanding of the financial statements.

The Accounting Policies will be subject to periodic review and update when it is

deemed necessary by the government.

The standardised accounting policies adopted in the preparation of the general purpose financial statements are set out below:

a. Statement of compliance and basis of preparation The financial statements have been prepared in accordance with the requirements of the Public Financial Management (PFM) Act, 2016 and comply with the International Public Sector Accounting Standard - Financial Reporting under the Cash Basis of Accounting (Cash Basis IPSAS). The measurement basis applied is the historical cost basis, except where otherwise stated in the accounting policies below. The financial statements have been prepared on the cash basis using the Government’s standard chart of accounts. The accounting policies adopted have been consistently applied to all the years presented.

b. Reporting Currency The financial statements are presented in Leones, which is the functional and reporting currency of the Government of Sierra Leone.

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c. Reporting Period

The reporting period for these financial statements is a period of twelve months starting on 1st January 20XX to 31 December 20XX, as specified in Section 1 of the PFM Act, 2016. (Note - The general purpose financial statements should be presented at least annually. When, in exceptional circumstances, an entity’s reporting date changes and the annual financial statements are presented for a period longer or shorter than one year, an entity should disclose in addition to the period covered by the financial statements: (a) The reason(s) for a period other than one year being used; and (b) the fact that comparative amounts may not be comparable.)

d. Receipts Receipts are cash inflows within the Financial Year, comprising of receipts from Statutory/Authorised Allocations, Taxes, External Assistance (Bilateral and Multilateral Agencies), Other Aid and Grants, other borrowings, Capital receipts (Sale of Assets etc.), Receipts from Trading activities, fines, levies, and other receipts. These items shall be disclosed in summary on the face of the Statement of Cash Receipts and Payments for the year in accordance with the standardised GPFS. Notes shall be provided with detailed Statement of Revenues collected during the year by source of revenue and by line item accounts code. Also, a Statement of Arrears of Revenues as at end of the financial year shall be provided by source of revenue and by line item accounts code. Disposal proceeds from the sale of assets are recognized as receipts at the time of disposal.

e. Interest Received

Interest actually received during the financial year shall be treated as a receipt under item ‘other receipts’.

f. Government Business activities Cash receipts from trading activities shall be recorded net in the GPFS (after deducting direct expenses) unless otherwise provided for by law or policy in force. Total net receipts from all trading activities shall be disclosed in the Statement of cash receipts and payments under ‘trading activities’ item Wherein gross revenue is recorded, corresponding payments shall be charged under a corresponding payment item head ‘Government Business activities’ in the Statement of Cash Receipts and Payments.

g. Payments

Payments are recurrent and capital cash outflows made during the financial year and shall be categorised either by major economic

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categories/programme (activities) and/or by function in the statement of cash receipts and payment. Payments for purchase of items of capital nature shall be expensed in the year in which the item has been purchased. It shall be disclosed under capital payments. Investments shall also be treated in the same way as capital purchases. At the end of the financial year, a schedule of fixed (physical) assets purchased shall be provided as part of the Additional Disclosures to the GPFS. Prepaid expenses are amounts paid in advance of receipt of goods/services or work done (under contractual arrangements) and are charged directly to the respective expenditure item in the period of payment.

h. Interest on Loans Actual Interest on loans and other bank commissions charged on Bank Accounts during the year shall be treated as payments and disclosed under interest payment in the Statement of Cash Receipts and Payments.

i. In-kind contributions/third party payments

In-kind contributions are donations that are made to the entity in the form of actual goods and/or services rather than in money or cash terms. These donations may include vehicles, equipment or personnel services. Where the financial value received for in-kind contributions can be reliably determined, the entity includes such value in the statement of receipts and payments (in a separate column) both as revenue and as an expense in equal and opposite amounts; otherwise, the contribution is not recorded.

j. Foreign Currency Translation

Cash flows arising from foreign currency transactions are translated into Leones using the spot exchange rates prevailing at the date of payment/receipt.

Foreign currency balances, as at the year end, shall be translated at the exchange rates prevailing on that date (closing spot rate or year-end exchange rate).

Foreign exchange gains and losses resulting from the settlement of foreign transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Cash Receipts and Payments accordingly either as receipts/payments.

k. Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and cash at bank, short-term deposits on call and highly liquid investments with an original maturity of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant risk of changes in value. These comprise mainly Bank account balances, include amounts held at the Bank of Sierra Leone and at various commercial banks, cash imprests and other short term highly liquid investments held at the end of the financial year.

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l. Imprests and Advances

The Government policy specifically states that all imprests and advances shall be retired before the end of the financial year. However, should circumstances occur (including an Emergency) where either an imprest/advance is given out close to the financial year end or an imprest/advance already given could not be accounted for, such an imprest/advance (or balance outstanding) shall be treated as cash equivalent since there shall be no proof that such funds have been utilised.

m. Budget The budget is developed on the same accounting basis (cash basis), the same accounts classification basis, and for the same period as the financial statements. The Budget Figures are the amounts approved by the Legislature in accordance with the Appropriation Act (annual budget and supplementary budget) and as detailed in the Government of Sierra Leone Budget Printed Estimates. An assessment of the actual budgetary performance, at the level of legislative approval, against the comparable budget for the financial year under review has been included as Statement B of these Financial Statements.

n. Contingencies

Contingent liabilities (including Guarantees) are recorded in the Statement of Contingent Liabilities (on memorandum basis) when the contingency becomes evident and under the cash accounting method they are recognized only when the contingent event occurs and payment is made. Contingent assets are not recognized and where not probable neither disclosed.

o. Unpaid (Outstanding) Commitments

Unpaid (Outstanding) Commitments including operating and capital commitments arising from non-cancellable contractual or statutory obligations are in the Statement of Unpaid (Outstanding) Commitments (shown on memorandum basis – as additional disclosure).

p. Comparative Information The GPFS shall disclose all numerical information relating to previous period (at least one year). Where necessary comparative figures for the previous financial year have been amended or reconfigured to conform to the required changes in presentation.

q. Subsequent events

Events subsequent to submission of the financial year-end financial statements to the Accountant General Department and other stakeholders with a significant impact on the financial statements may be adjusted with the concurrence of the Accountant General’s Department.

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IX. Explanatory Notes to the Accounts

Explanatory Notes should include narrative descriptions, detailed schedules, and analyses of amounts shown on the face of the financial statements, as well as additional information. The additional information could be either required by law or deemed absolutely necessary to better understand the financial statements, and to achieve a fair presentation and enhance accountability. Large Detailed Schedules can be shown as Appendices, with reference made in the Notes to the Accounts. The Explanatory Notes to the financial statements should be presented in a systematic manner. Each item on the face of the statement of cash receipts and payments and other financial statements should be cross referenced to any related information in the notes. Authorisation Date - An entity should disclose the date when the financial statements were authorized for issue and who gave that authorization. The authorization date is the date on which the financial statements have received approval from the individual or body with the authority to finalize those statements for issue. It is important for users to know when the financial statements were authorized for issue, because the financial statements do not reflect events after this date. Example - ‘The financial statements were authorized for issue on XX Month 2015 by Mr YY, Chairman/Head of the MDA. Comparative Information - Comparative Information should be disclosed in respect of the previous period for all numerical information. Comparative information should be included in narrative and descriptive information when it is relevant to an understanding of the current period’s financial statements. Restrictions on Cash Balances and Access to Borrowings - An entity should disclose in the notes to the financial statements together with a commentary, the nature and amount of: (a) Significant cash balances that are not available for use by the entity; (b) Significant cash balances that are subject to external restrictions; and (c) Undrawn borrowing facilities that may be available for future operating activities and to settle capital commitments, indicating any restrictions on the use of these facilities.

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X. Additional Disclosures – Memorandum Statements

The Additional Disclosures – Memorandum Statements required to be presented are as follows:

a) Format – Statement of Revenues collected during the year (Based on source of revenue and detailed line item accounts code)

STATEMENT D STATEMENT OF DETAILED REVENUE COLLECTED DURING THE YEAR ENDED 31ST

DECEMBER 20XX Amounts in Leones

Details 20XX 20XX-1

Budget Actual Budget Actual XXX MDA NAME Tax Revenue line item code 1 XX XX XX XX Revenue line item code 2 XX XX XX XX Revenue line item code 3 XX XX XX XX Revenue line item code 4 XX XX XX XX Non Tax Revenue line item code1 XX XX XX XX Revenue line item code 2 XX XX XX XX Revenue line item code 3 XX XX XX XX Revenue line item code 4 XX XX XX XX Revenue line item code 5 XX XX XX XX Total Revenue XX XX XX XX

b) Format – Statement of Arrears of Revenues at end of the financial year (Based on source of revenue and detailed line item accounts code)

STATEMENT E STATEMENT OF DOMESTIC REVENUE ARREARS AS AT 31ST DECEMBER 20XX

Amounts in Leones

Details 20XX 20XX-1 XXX MDA NAME Tax XX XX Revenue line item code 1 XX XX Revenue line item code 2 XX XX Revenue line item code 3 XX XX Non Tax Revenue line item code 1 XX XX Revenue line item code 2 XX XX Revenue line item code 3 XX XX Revenue line item code 4 XX XX Total Revenue Arrears XX XX

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c) Format – Statement of Payments by Programs/Activities

STATEMENT F

STATEMENT OF DETAILED PAYMENTS BY PROGRAMMES/ACTIVITIES DURING THE YEAR ENDED 31ST DECEMBER 20XX

Amounts in Leones

Details 20XX 20XX-1

Budget Actual Budget Actual XXX MDA NAME Programme1 Activity 1 XX XX XX XX Activity 2 XX XX XX XX Activity 3 XX XX XX XX Activity 4 XX XX XX XX Programme 2 Activity 1 XX XX XX XX Activity 2 XX XX XX XX Activity 3 XX XX XX XX Activity 4 XX XX XX XX Programme 3 Activity 1 XX XX XX XX Activity 2 XX XX XX XX Activity 3 XX XX XX XX Activity 4 XX XX XX XX Total Payments XX XX XX XX

d) Format – Statement of Outstanding Commitments

STATEMENT G STATEMENT OF UNPAID COMMITMENTS OUSTANDING AS AT 31ST

DECEMBER 20XX Amounts in Leones

Particulars Note Outstanding

Amounts

Aged Analysis 0<>6

Months 6<> 12 Months

>12 Months

Compensation of Employees Use of goods and services Capital/Development Expenditure Financing Cost – Interest Payments Repayment of principal on local and foreign loans

Subsidies and Transfers Grants Social Benefits Other Payments Total Unpaid Commitments Outstanding

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e) Format – Statement of Fixed (Physical) Assets Purchased During the Year

STATEMENT H

STATEMENT OF FIXED (PHYSICAL) ASSETS PURCHASED DURING THE YEAR ENDED 31ST DECEMBER 20XX

Amounts in Leones

Particulars Accounts

Code Note Amounts

Acquisition of Land 2611

Acquisition of Buildings 2612

Furniture, Office Equipment, Safes 2613

Computers and Ancillary Equipment 2614

Motor Vehicles 2615

Land Improvements 2617

Medical Equipment 2618

Science Equipment 2619

Feasibility Studies, Project Preparation/Design 2621

Physical Planning 2622

Motor Cycles 2623

Bicycles and Tricycles 2624

Sanitary Tools 2625

Plant, Equipment & Machinery 2631

Construction/Reconstruction of Buildings 2632

Rehabilitation of non-residential Buildings 2633

Construction/Reconstruction of Trunk & Secondary Roads

2634

Construction/Reconstruction of Feeder Roads 2636

Construction/Reconstruction of Jetties 2637

Construction/Reconstruction of Toilet 2638

Construction/Reconstruction of Water System 2639

Construction/Reconstruction of Irrigation System 2640

Construction/Reconstruction of Other Structures 2641

Rehabilitation of Residential Buildings 2642

Total Fixed (Physical) Assets Purchased During the Year

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f) Format – Statement of Disposal of Fixed (Physical) Assets During the Year

STATEMENT I STATEMENT OF DISPOSAL OF FIXED (PHYSICAL) ASSETS DURING THE

YEAR ENDED 31ST DECEMBER 20XX Amounts in Leones

Particulars Accounts

Code Note

Sale Proceeds

Sale of Land 2611

Sale of Buildings 2612

Furniture, Office Equipment, Safes 2613

Computers and Ancillary Equipment 2614

Motor Vehicles 2615

Land Improvements 2617

Medical Equipment 2618

Science Equipment 2619

Feasibility Studies, Project Preparation/Design 2621

Physical Planning 2622

Motor Cycles 2623

Bicycles and Tricycles 2624

Sanitary Tools 2625

Plant, Equipment & Machinery 2631

Total Disposal of Fixed (Physical) Assets During the Year

g) Format – Statement of Undrawn External Assistance

The Cash Basis IPSAS Standard requires disclosure of any undrawn borrowing and loan facilities that may be available for future operating activities and to settle capital commitments, indicating any restrictions on the use of these facilities.

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STATEMENT I STATEMENT OF UNDRAWN EXTERNAL ASSISTANCE AS AT THE YEAR

ENDED 31ST DECEMBER 20XX Amounts in Leones

Development Emergency Others Total 20XX 20XX-1 20XX 20XX-1 20XX 20XX-1 20XX 20XX-1 Opening Bal Loans XX XX XX XX XX XX XX XX Grants XX XX XX XX XX XX XX XX Approved in the period

Loans XX XX XX XX XX XX XX XX Grants XX XX XX XX XX XX XX XX Draw downs Loans (XX) (XX) (XX) (XX) (XX) (XX) (XX) (XX) Grants (XX) (XX) (XX) (XX) (XX) (XX) (XX) (XX) Cancelled/Expire Loans (XX) (XX) (XX) (XX) (XX) (XX) (XX) (XX) Grants (XX) (XX) (XX) (XX) (XX) (XX) (XX) (XX) Exchange difference

XX XX XX XX XX XX XX XX

Closing Bal Loans XX XX XX XX XX XX XX XX Grants XX XX XX XX XX XX XX XX

h) Format – Statement of Contingent Liabilities

STATEMENT K

STATEMENT OF CONTINGENT LIABILITIES AS AT 31 DECEMBER 20XX Amounts in Leones Note 20XX 20XX-1 Legal Proceedings XX XX Guarantees and Indemnities XX XX Guarantees on bank overdraft XX XX Other contingent Liabilities XX XX Total XX XX

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This Document was prepared with technical assistance support provided by

Linpico Sarl under the EU funded State Building Contract Technical Assistance Project

in Sierra Leone.