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SAI No: 40
AUIN
0113‐012‐759
DIT REPONDUSTRIAFor the
9/14
ORT OF PRAL WASTperiod 2
STATE AU
REPARATE MANAG23rd Marc
Podgoric
DIT INSTIT
TION ADVGEMENT h 2011 ti(final)
ca, 27th July 2
TUTION
VANCE FOAND CLEll 15th De
2015
OR MONTEAN‐UP Pecember 2
TENEGROPROJECT 2014
O
2
AUDIT REPORT OF PREPRATION ADVANCE FOR MONTENEGRO INDUSTRIAL WASTE MANAGEMENT AND CLEAN‐UP PROJECT
for the period from 23 March 2011 to 15 December 2014 Pursuant to Article 9 of the Law on the State Audit Institution and the Decision of the relevant Auditing Board, composed by a Leader of the Auditing Board, Milan Dabović, PhD and a member of the Auditing Board, Dragiša Pešić, the State Audit Institution has performed audit of Preparation Advance for the “Montenegro Industrial Waste Management and Clean‐up Project” financed by the International Bank for Reconstruction and Development (World Bank) – Preparation Advance no. IBRD P4600‐ME, for the period 23rd March 2011 – 15th December 2014. The Report on Loan Proceeds is within the jurisdiction of the Ministry of Finance, as the signatory of the Loan Agreement and the Environmental Protection Agency, as the implementing entity of the “Montenegro Industrial Waste Management and Clean‐up Project”. The audit was conducted pursuant to Articles 4 and 9 of the Law on the State Audit Institution, relevant SAI international standards (ISSAI) and the Annual Plan of the State Audit Institution for 2015, no: 4011‐06‐1799 as of 25 December 2014. In accordance with the SAI international standards (ISSAI), the State Audit Institution complied with ethical requirements and planned and conducted the audit as to ensure reasonable confidence that there are no materially incorrect presented data. In our opinion, the audit did not determine irregularities in implementation of the legislation related to performance of the project activities for which the advance was provided. The contracts for consulting services were prepared and realized in line with the Advance Agreement for Preparation of the “Montenegro Industrial Waste Management and Clean‐up Project” (Preparation Advance no. IBRD P4600‐ME), Standard Conditions for Advances Made by the World Bank under its Project Preparation Facility (dated July 2010), Disbursement Letter for the Advance and World Bank Disbursement Guidelines for Projects (dated May, 2006). Activities envisaged by the consulting contracts were realized in line with defined terms of references and refinancing dates, approved by the World Bank.
The public procurement procedure for selection of the consultants based on quality and costs (QCBS) and public procurement procedure for selection of the consultants based on consultants’ qualifications (QBS) are carried out in line with the Guidelines of the World Bank for Selection and Employment of Consultants under IBRD Loans and IDA Credits by World Bank Borrowers.
Transfer of proceeds of the Advance by the World Bank was conducted in line with concluded contracts with consulting firms, disbursement letters issued by the Environmental Protection Agency and issued invoices for eligible expenses. The revenues and expenditures of the “Montenegro Industrial Waste Management and Clean‐up Project” and financial situation of
3
the Project were presented, in all material aspects, in real and objective manner. The revenues and payments were executed in line with the relevant World Bank Disbursement Guidelines for Projects, during the period of the Project effectiveness, i.e. from 23 March 2011 until 15 December 2014 and therefore, the relevant Auditing Board has expressed unqualified audit opinion with emphasis on the following:
1. The Environmental Protection Agency has indicated that the amount of EUR 769,231.00 was withdrawn as of 11 May 2015. The Environmental Protection Agency has not reduced this amount by USD 51,207.51 repaid to the World Bank as of 09 February 2015.
The Environmental Protection Agency together with the Ministry of Finance shall determine the precise amount of withdrawn funds, which will be included in the loan amount, in conformity with the Loan Agreement for “Montenegro Industrial Waste Management and Clean‐up Project”, the total value of which amounts to EUR 50,000,000.00.
2. The Environmental Protection Agency, as the spending unit responsible for the project implementation, has failed to compile the Project‐related records, so to enable monitoring thereof and to enable the Ministry of Finance, as the beneficiary, to supervise the implementation.
In line with the World Bank Disbursement Guidelines for Projects and Standard Conditions for Advances Made by the World Bank, the Environmental Protection Agency shall furnish the records and supporting documents showing eligible costs and performed activities for the following projects and retain them within prescribed deadlines.
3. The Environmental Protection Agency has failed to submit to the World Bank financial reports in form satisfactory to the World Bank, therefore violating the Loan Agreement, Item 2.05, b) – Financial Reporting, governing that the Borrower shall prepare and furnish to the Bank not later than forty‐five (45) days after the end of each calendar quarter, interim unaudited financial reports for the Projects covering the quarter, in form and substances satisfactory to the Bank.
In line with the Loan Agreement, the Environmental Protection Agency shall submit to the World Bank interim unaudited financial reports on Project‐related revenues and expenditures.
PRESIDENT OF SENATE PhD Milan Dabović, leader of Auditing Board
(duly signed and stamped)
4
Introduction At request of the World Bank, the State Audit Institution has performed audit of Preparation Advance for the “Montenegro Industrial Waste Management and Clean‐up Project” financed from the loan granted by the International Bank for Reconstruction and Development (World Bank) – Preparation advance no. IBRD P4600‐ME. The audit report of Preparation Advance for the “Montenegro Industrial Waste Management and Clean‐up Project” contains the review of utilization of proceeds in the period from 23 March 2011 until 15 December 2014, i.e. in the period from the day of signing of the Loan Agreement no. IBRD P4600‐ME until the last refinancing date approved by the World Bank. The project implementation is governed by the World Bank rules governing the Project implementation, procurements, contract management, eligible expenses, audit and reporting to the Bank. 1. Audit Objective ‐ The objective of the audit is to express opinion on the financial situation of the Project, revenues and expenses incurred during the period from 23 March 2011 until 15 December 2014 and compliance with the regulatory framework in terms of implementation of activities for which proceeds of the advance were requested. 2. Project Description – At request for financial assistance made by Montenegro no. 02‐12647/1 as of 12 November 2010, the International Bank for Reconstruction and Development (World Bank) granted the preparation advance from the World Bank project preparation facilities amounting to USD 1,000,000.00, in compliance with conditions stated in the Agreement on Preparation Advance for the “Montenegro Industrial Waste Management and Clean‐up Project”. As of 23 March 2011, the Government of Montenegro – Ministry of Finance signed the Agreement on Preparation Advance for the “Montenegro Industrial Waste Management and Clean‐up Project” – Preparation advance no. IBRD P4600‐ME. The beneficiary is the Ministry of Finance, as the authorized representative of Montenegro. The Environmental Protection Agency is the implementing entity, responsible for the implementation of activities. 3. Refinancing ‐ The Agreement, Article III – Withdrawal of Advances, Item 3.03, stipulates that the refinancing date shall be 01 October 2012. In compliance with the letter of the Ministry of Finance no. 06‐4329 as of 27 October 2014 requesting from the International Bank for Reconstruction and Development to postpone the refinancing date of the project preparation stage, the Bank determined 15 December 2014 as the latest refinancing date. 4. Description of Project Activities – Article II, Item 2.01 Description of Activities, of the Agreement sets activates for which the advance is granted: ‐ Site investigations and preparation study to determine remediation requirements and budgets for the selected historic industrial waste disposal sites; ‐ Siting and feasibility study for the development of a national hazardous waste disposal facility in Montenegro; ‐ Environmental Impact Assessment for industrial disposal sites remediation works and establishment of national hazardous waste disposal facility;
5
‐ Project management, including fiduciary functions, procurement and financial management, monitoring and evaluation. Item 2.03 of the Agreement regulates that the advance is made available to the project implementing entity, in accordance with terms and conditions defined by the World Bank. Item 2.04 – Project Monitoring, Reporting and Evaluation ‐ of the Agreement regulates that the Recipient shall monitor and evaluate the progress of the activities in accordance with the provisions of Section 2.08 of the Standard Conditions. Establishment of Project‐related bodies and working groups Pursuant to Article 55 of the Decree on Organization and Work of the Public Administration, (“Official Gazette of Montenegro”, no. 05/12), the Environmental Protection Agency passed the Decision no. 16‐655/1 as of 21 February 2012 on formation of the Steering Committee for the Implementation of the “Montenegro Industrial Waste Management and Clean‐up Project”. This Decision establishes the Steering Committee consisting of 9 members and sets their terms of references. Item 3 thereof regulates that “Expenses for work of the Steering Committee shall be borne by the institution employing the members of the Steering Committee”. The Environmental Protection Agency has not effectuated payments for remuneration of the members of the Steering Committee (Item 3 of the Letter D‐1609/1 as of 16 June 2016). Pursuant to Article 9 of the Decree on Organization and Work of the Public Administration, (“Official Gazette of Montenegro”, nos. 07/11, 40/11), the Environmental Protection Agency passed the Decision no. 38971 as of 19 December 2011 on establishment of the technical working group for the “Montenegro Industrial Waste Management and Clean‐up Project” defining the following: members of the technical working group; terms of references; evaluation of reports and monitoring work conducted by consultants; costs of work of the working group (to be paid by the Environmental Protection Agency); remuneration costs for members. Pursuant to the Decision no. 05‐D‐389172, total costs for work of the technical working group paid from the budget of the Environmental Protection Agency amount to EUR 1,000.00 (split in tranches amounting to EUR 250.00). In the letter no. D‐2434/1 as of 30 October 2012, the Environmental Protection Agency informed the World Bank on formation of the Project Management Unit (PMU). Members of the Project Management Unit are employees of the Environmental Protection Agency: Vladan Dragutinović – project manager; Almina Bucan – communication officer; Monika Figaj – advisor for project results monitoring; Zoran Amidžić – financial management expert. Moreover, the letter states that the Project Management Unit will engage two experts (environmental protection expert/civil engineer and waste management expert), the engagement of which will be conducted through the open bid procedure at the moment their involvement is considered
6
to be necessary. All procurement‐related activities shall be conducted by experts from the Technical Support Unit (TSU). II FINDINGS AND ESTABLISHMENT OF FACTS The Government of the Republic of Montenegro, Ministry of Finance and International Bank for Reconstruction and Developments signed the Loan Agreement for the “Montenegro Industrial Waste Management and Clean‐up Project” as of 10 October, of the total value of EUR 50,000,000.00. For the purpose of the project preparation, the Advance Agreement for Preparation of the Montenegro Industrial Waste Management and Cleanup Project – Preparation Advance no. IBRD P4600‐ME amounting to USD 1,000,000.00 was concluded as of 23 March 2011 between the Government of Montenegro – Ministry of Finance and World Bank. Based on data from the Agency, the amount spent during the Project preparation stage (USD 1,000,000.00) is included in the loan amount, set by the Loan Agreement for the main Project. Proceeds included in the loan amount pursuant to the Loan Agreement (EUR 50,000,000.00) are considered as withdrawn and according to data provided by the Environmental Protection Agency amounted to 769,231.00 as of 11 May 2015. The Table below indicates an overview of USD amounts disbursed by the World Bank.
Disbursement USD
Direct disbursement of the World Bank for consultant services 818.648,52
Disbursement to the Environmental Protection Agency 181.351,48
Total 1.000.000,00
Return of unspent proceeds as of 09 February 2015 51.207,51
Total 948.792,49
Through direct payments to suppliers (consultants), the World Bank disbursed the amount of USD 818,648.52 and USD 181,351.48 to the foreign currency account of the Environmental Protection Agency, opened with the Montenegro Commercial Bank (Montenegrin Commercial Bank) in Podgorica, for the purpose of Project financing. Unspent proceeds on the foreign currency account of the Environmental Protection Agency as of 21 January 2015 amounting to USD 51,094.51 as well as unspent proceeds on the euro account amounting to EUR 195.17 were returned to the World Bank as of 09 February 2015 in the total amount of USD 51,207.51. The preparation advance withdrawn by the Environmental Protection Agency for the purpose of the Project preparation phase amounted to EUR 769,231.00 as of 11 May 2015. When
7
calculating the above amount, the Environmental Protection Agency has not calculated funds amounting to USD 51,207.51 returned to the World Bank as of 09 February 2015. Recommendation: The Environmental Protection Agency together with the Ministry of Finance shall determine the precise amount of withdrawn funds, which will be included in the loan amount, aligned with the Loan Agreement for the “Montenegro Industrial Waste Management and Clean‐up Project”, the total value of which amounts to EUR 50,000,000.00. Project‐related accounting records shall be kept by the Ministry of Finance, pursuant to the national legislation i.e. Rulebook on Unified Classification of Accounts for the Republic Budget, Extrabudgetary Funds and Local Budgets. However, the Environmental Protection Agency, as the Project Implementing Entity, has failed to keep project‐related records in a proper form, in order to enable monitoring and enable the Ministry of Finance, as the beneficiary, to supervise the implementation, which is not in line with World Bank Disbursement Guidelines for Projects (dated May, 2006), Item 4.3 Types of Documents and Standard Conditions for Advances Made by the World Bank under its Project Preparation Facility (dated 31 July 2010), Item 2.7 – Documents and Records. Recommendation: In line with the World Bank Disbursement Guidelines for Projects and Standard Conditions for Advances Made by the World Bank, the Environmental Protection Agency shall furnish the records and supporting documents showing eligible costs and performed activities for the following projects and retain them within prescribed deadlines. The auditing of the Project Advance for the “Montenegro Industrial Waste Management and Clean‐up Project” for the period from 23 March 2011 until 15 December 2014 (i.e. from the day of signing of the Loan Agreement no. IBRD P4600‐ME until the last refinancing date) covered as follows:
1. Financial statements 2. Project revenues and expenditures 3. Accounts of the Environmental Protection Agency 4. Realization of contracts concluded with consultants for consultant services 5. Public procurements
1. FINANCIAL STATEMENTS
Preparation of financial statements, including also proper disclosure, is under responsibility of the Environmental Protection Agency.
The Environmental Protection Agency has failed to submit to the World Bank financial reports in required forms, therefore violating the Loan Agreement, Item 2.05 b) – Financial Reporting, governing that the Borrower shall prepare and furnish to the Bank not later than forty‐five (45)
8
days after the end of each calendar quarter, interim unaudited financial reports for the Projects covering the quarter, in form and substances satisfactory to the Bank.
In line with the Loan Agreement, the Environmental Protection Agency shall submit to the World Bank interim unaudited financial reports on Projected‐related revenues and expenditures.
The table below presents an overview of proceeds disbursed by the World Bank, based on the World Bank data:
Year Granted loan amount USD
Disbursement date
Disbursement amount USD
Disbursement amount EURO
Supplier
2011 1.000.000,00 22.11.2011 90.000,00 DA‐A (Deposit account) 2012 06.01.2012 50.028,97 38.555,00 ECOREM NV 25.014,48 19.277,50 ECOREM NV
02.05.2012 100.050,04 75.652,20 CDM EUROPE 100.050,03 75.652,20 CDM EUROPE 28.06.2012 76.786,48 DA‐A (Deposit account) 16.07.2012 138.307,35 113.478,30 CDM EUROPE 19.09.2012 50.493,56 38.555,00 ECOREM NV 01.10.2012 57.231,35 44.493,00 COWI
15.10.2012 38.157,20 29.662,00 COWI
19.12.2012 99.497,77 75.652,20 CDM EUROPE
2013 03.01.2013 14.565,00 DA‐A (Deposit account)
05.02.2013 79.373,71 58.194,00 ECOREM NV
19.04.2013 38.458,92 29.277,50 ECOREM NV
03.05.2013 41.985,14 32.104,87 CDM EUROPE
Ukupno 1.000.000,00 630.553,77
818.648,52 Direct payments
181.351,48 DA‐A (Deposit account) Proceeds disbursed by the World Bank to finance the “Montenegro Industrial Waste Management and Clean‐up Project” in the period from 23 March 2011 to 15 December amount to USD 1,000,000.00.
2. PROJECT REVENUES AND EXPENSES
2.1. Project Revenues The table below presents an overview of proceeds disbursed in USD and EUR::
Disbursement USD USD USD Euro
Direct disbursement 818.648,52 818.648,52 630.553,77
Payments to the Agency 181.351,48 344,57 181.006,91 38.318,23
Total 1.000.000,00 999.655,43 768.872,00
Return of unspent funds 51.207,51 51.207,51 41.973,37
Total 948.792,49 948.447,92 726.898,63
9
Amount difference of USD 344.57 between proceeds transferred by the World Bank (USD 181,351.48) and inflow of funds to the Agency’s account (USD 181,006.91) refers to the bank transaction fees.
2.2. Project Expenses Incurred Project expenses amounting to EUR 727,984.99 are shown in the Table below:
Description Amount
Expenses for consultant services stemming from concluded contracts
713.969,40
Expenses for consultant services stemming from public procurements
12.712,37
Expenses for public procurement announcements 1.022,00
Bank fees 86,75
Total 727.790,52
Bank fees for transfer of funds to the Bureau for the Settlement of Payment (ZOP)
194,47
Total 727.984,99
Expenses for consultant services amount to EUR 713,969.40, whereas direct payments effectuated by the World Bank account for EUR 630,553.77 (USD 818,648.52) while payments effectuated by the Environmental Protection Agency account for EUR 83,415.63. The Environmental Protection Agency effectuated payment of other Project‐related expenses amounting to EUR 13,821.12 from the deposit account. The amount of EUR 194.47 refers to Bank charges for transfer of funds to the Bureau for the Settlement of Payment (ZOP). The Table below shows an overview of direct disbursements made by the World Bank and payments made by the Environmental Protection Agency. No.
DESCRIPTION CONTRACT
DISBURSEMENTTOTAL
World Bank Agency
USD € € USD €
I Disbursed funds 1.000.000,00 769.230,00
1. Consortium CDM EUROPE GMBH and Hidroinženjering d.o.o
IWMCP‐PPF‐CS1
479.890,33 372.539,77 479.890,33 372.539,77
2. ECOREM LTD (Belgium) i Hidroplan d.o.o IWMCP‐PPF‐CS2
243.369,64 183.859,00 243.369,64 183.859,00
3. COWI A/S IWMCP‐CS‐CQ‐CS3
95.388,55 74.155,00 95.388,55 74.155,00
II Direct World Bank disbursement – TOTAL (1+2+3)
818.648,52 630.553,77 818.648,52 630.553,77
4. Consortium CDM EUROPE GMBH and Hidroinženjering d.o.o
IWMCP‐PPF‐CS1
5.721,23 5.721,23
5. ECOREM LTD (Belgium and Hidroplan d.o.o + VAT
IWMCP‐PPF‐CS2
65.088,05 65.088,05
6. VAT stemming from the Contract IWMCP‐CS‐CQ‐CS3
IWMCP‐CS‐CQ‐CS3
12.606,35 12.606,35
10
7. Public procurement consultant 12.712,37 12.712,37
8. Daily newspaper "Pobjeda" 1.022,00 1.022,00
9. Bank fees 86,75 86,75
10. Withheld bank fees 194,47 194,47
III Direct disbursement of the Agency and withheld fees (4+5+6+7+8+9 +10)
97.431,22 130.143,97 97.431,22
IV Total disbursement (II + III) 97.431,22 948.792,49 727.984,99
V Unutilized funds returned to the World Bank account (I‐IV)
51.207,51 41.245,01
3. ACCOUNTS OF THE ENVIRONMENTAL PROTECTION AGENCY Based on the Application no. D/904/1 as of 27 May 2011 submitted by the Environmental Protection Agency requesting opening of a foreign currency account for the purpose of the implementation of the “Montenegro Industrial Waste Management and Clean‐up Project”, the Ministry of Finance opened a special foreign currency account no. 2345011‐126‐02010658 with the Montenegro Commercial Bank (Crnogorska komercijalna banka), pursuant to provisions of the relevant General Conditions and relevant financial agreements. Proceeds shall be managed by responsible people within the Ministry of Finance.
3.1. Foreign currency account of the Environmental Protection Agency The Table below shows an overview based on analytical record cards of the Montenegro Commercial Bank on inflows and outflows on the foreign currency account of the Environmental Protection Agency for the period from 01 January 2011 to 21 January 2015 in USD:
Analytical Records Cards in USD ‐ 126‐02010658
Date Order Inflow Outflow Balance
22.09.2011 57479915 89.849,72 89.849,72 06.10.2011 57740728 89.849,72 ‐
28.06.2012 63025877 76.646,52 76.646,52 28.11.2012 66099725 13.065,85 63.580,67 03.01.2013 66869898 14.510,67 78.091,34 28.02.2013 67931410 13.274,92 64.816,42
16.05.2013 69583267 13.721,90 51.094,52 181.006,91 129.912,39 51.094,52
1) Inflow of funds in the above period ..........................181.006,91 USD 2) Outflow of funds in the above period ..........................129.912,39 USD 3) Balance .......................................................................51.094,52 USD
Proceeds on the foreign currency account of the Environmental Protection Agency as of 21 January 2015 amounted to USD 51,094.51 and were returned to the World Bank (included in the amount of EUR 51,207.51) as of 09 February 2015.
11
3.2. Account of the Environmental Protection Agency opened with the Montenegro Commercial Bank in EUR (ZOP)
The Table below shows an overview of sale (conversion) of foreign currency proceeds and transfer into the ZOP account broken down by years:
Year Outflow from the foreign account in
USD
Inflow‐ purchase of foreign
currency in EUR
Exchange USD/€
Transfer to ZOP 126‐02010658
Bank charges
End‐of‐year balance
2011 89.849,72 67.126,39 1,34 12.657,05 25,31 54.444,03 2012 13.065,85 10.000,00 1,31 63.988,31 127,97 327,75
2013 26.996,82 20.500,00 1,32 20.591,39 41,19 195,17
129.912,39 97.626,39 1,33 97.236,75 194,47 195,17 From the USD foreign currency account of the Agency, the amount of USD 129,912.39 (EUR 97,626.39) was sold (conversion was conducted by applying the average exchange rate of 1.33 USD/EUR). Outflow of funds in the period from 01 January 2011 to 21 January 2015 amounted to EUR 97,236.75, bank fees accounted for EUR 194.47 and the balance as of 21 January 2015 amounted to EUR 195.17, which was returned to the World Bank account (included in the amount of EUR 51,207.51) as of 09 February 2015.
4. REALIZATION OF CONTRACTS CONCLUDED WITH CONSULTANTS FOR CONSULTANT SERVICES
4.1. Contract on consultant services, IWMCP‐PPF‐CS1, concluded as of 04 November
2011 between:
1. Environmental Protection Agency of Montenegro – Ministry of Sustainable Development and Tourism; and
2. CONSORTIUM consisting of: CDM EUROPE GMBH with the head office in Germany and HIDROINZENJERING D.O.O. with the head office in Slovenia.
The scope of the Contract for provision of consultant services is as follows: site investigation and feasibility study for remedial works on environmentally most important locations in Montenegro. The value of the contract in the local currency amounts to EUR 323,300.00; plus VAT (17%) amounting to EUR 54,961.00, totaling EUR 378,261.00. The Table below shows an overview of payments stemming from the aforestated Contract.
Invoices,in complto EUR 3Environmto EUR financing37,826.1
4.2.
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ments to theEcorema Coy consultantn two locatiold Bank as od documentto EUR 248,
he VAT amoconcluded cPayments aection Agencand payme
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al Protectit and TourismM consisting with the heT D.O.O. with
ontract for ation of stu
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were signedd Hidroplanaadditional aand KAP). Th12 for approed terms of rease of the
12
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Belgium andffice in Croa
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contract on provision of consultant services by the joint venture consisting of ECOREM LTD (Belgium) and Hidroplan d.o.o. (IWMCP‐PPF‐CS2) was conducted in compliance with the quality and cost‐based selection procedure (QCBS) and in line with the Guidelines of the World Bank for Selection and Employment of Consultants under IBRD Loans and IDA Credits by World Bank Borrowers. The public procurement for the quality‐based selection (QCBS) covered as follows: preparation of the terms of reference; publication of the request for expression of interest; short list of candidates; preparation of the report on evaluation of applications based on the expression of interest; preparation of the request for proposals (RFP), to be forwarded solely to the best qualified company; evaluation of combined technical and financial offers; negotiations with the best qualified company; drafting of the contract; contract signing. The World Bank submitted no objection to the following documents: amended report on evaluation of applications based on the request for expression of interest; draft request for proposal; draft contract. Signed contract was submitted to the World Bank.
5.2. Qualification based selection (QBS)
Selection of consultants for the contract on provision of consultant services by the COWI A/S (IWMCP‐CS‐CQ‐CS3) was conducted in compliance with the Qualification based selection procedure (QBS) and in line with the Guidelines of the World Bank for Selection and Employment of Consultants under IBRD Loans and IDA Credits by World Bank Borrowers. The public procurement for the qualification based selection (QBS) covered as follows: preparation of the terms of reference; publication of the request for expression of interest; short list; preparation of the report on evaluation of applications based on the expression of interest; preparation of the request for proposals (RFP), forwarded solely to the best qualified company; evaluation of combined technical and financial offer; negotiations with the best qualified company; drafting of the contract; contract signing. The World Bank submitted no objection to the following documents: amended report on evaluation of applications based on the request for expression of interest; draft request for proposal; draft contract. Signed contract was submitted to the World Bank. PRESIDENT OF SENATE PhD Milan Dabović, leader of Auditing Board
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Mr. Milan Dabović President State Audit Institution Novaka Miloseva Street Podgorica, Montenegro Preliminary Audit Report of Preparation Advance for Montenegro Industrial Waste Management and Clean‐Up Project, IBRD 84280 Dear Mr. Dabović, Thank you for submitting to us the above report. I would like to stress that the report has been compiled in compliance with agreed terms of references and the audit has been conducted in line with relevant auditing standards. The preliminary report meets all requirements and we agree that the State Audit Institution shall finalize the report, upon taking into account comments expressed by the entity subject to the audit. We would like to thank you in advance for submitting the final version of the report as well as for the current and future cooperation. Best regards, Aleksandar Crnomarković Senior Financial Management Specialist World Bank