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KENYA NATIONAL AUDIT OFFICE
REPORT
OF
THE AUDITOR-GENERAL
ON
THE FINANCIAL STATEMENTS OF NATIONAL URBAN TRANSPORT
IMPROVEMENT PROJECT CREDIT NO. 5140 - KE
FOR THE YEAR ENDED 30 JUNE 2014
KENYA NATIONAL HIGHWAYS AUTHORITY
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. Telephone: +254-20-342330 Fax: + 254-20-311482 E-Mail: [email protected] Website. www.kenao.go.ke
REPUBLIC OF KENYA
P.O. Box 30084-00100 NAIROBI
KENYA NATIONAL AUDIT OFFICE REPORT OF THE AUDITOR-GENERAL ON NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT- CREDIT NO. 5140 - KE FOR THE YEAR ENDED 30 JUNE 2014-KENYA NATIONAL HIGHWAYS AUTHORITY
REPORT ON THE FINANCIAL STATEMENTS
I have audited the accompanying financial statements of National Urban Transport Improvement Project Credit No. 5140 - KE set out on pages 1 to 8, which comprise the statement of financial assets and liabilities as at 30 June 2014, and statement of receipts and payments, statement of cash flow and statement of comparative budget and actual amount for the year then ended, and a summary of significant accounting policies and other explanatory information in accordance with the provisions of Article 229 of the Constitution of Kenya, Section 14 of the Public Audit Act, 2003 and the Financing Agreement No. 5140 - KE dated 26 September 2012 between the International Development Association (IDA) and the Government of Kenya (GOK). I have obtained all the information and explanations which, to the best of my knowledge and belief, were necessary for the purpose of the audit.
Management's Responsibility for the Financial Statements
The Director General, Kenya National Highways Authority (KeNHA) and the Project Implementation Team Leader are responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards (Cash Basis) and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
The management is also responsible for the submission of the financial statements to the Auditor-General in accordance with the provisions of Section 13 of the Public Audit Act, 2003.
Auditor- General's Responsibility
My responsibility is to express an opinion on these financial statements based on the audit and report in accordance with the provisions of Section 15(2) of the Public Audit Act, 2003. The audit was conducted in accordance with International Standards on Auditing. Those standards require compliance with ethical requirements and that the audit be planned and performed to obtain reasonable assurance about whether the financial statements are free from material misstatement.
Promoting Accountability in the Public Sector
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 Project's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements. . ...
I believe the audit evidence obtained is sufficient and appropriate to provide a basis for my audit opinion.
Opinion
In my opinion, the financial statements present fairly, in all material respects, the financial position of the Project as at 30 June 2014, and of its financial performance and its cash flows for the year then ended, in accordance with International Public Sector Accounting Standards (Cash Basis) and comply with the Financing Agreement No. 5140 - KE.
In addition, the Special Account Statement presents fairly the special account transactions and the ending balance has been reconciled with the books of account.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
As required by the International Development Association, I report based on my audit that:-
i) All International Development Association funds have been used in accordance with the conditions of the Financing Agreement, with due attention to economy, and efficiency and only for the purpose for which the funds were provided;
ii) Counterpart funds have been provided and used in accordance with the conditions of the Agreement, with due attention to economy and efficiency and only for the purpose for which they were provided;
iii) Goods and services financed have been procured in accordance with the conditions of the Agreement and in compliance with the Development partner's rules and procedures;
iv) Necessary supporting documents, records and accounts have been kept in respect of all Project activities;
v) Adequate internal controls to monitor expenditure and other financial transactions exist; and
2
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vi) The fixed assets register for the Projects' assets was maintained during the year.
Edward R.O. Ouko, CBS Auditor-General
Nairobi
19 December 2014
3
MINISTRY OF TRANSPORT AND INFRASTRUCTURE
PROJECT NAME: KENYA NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
IMPLEMENTING ENTITY: KENYA NATIONAL IDGHWAYS AUTHORITY
PROJECT GRANT/CREDIT NUMBER: LOAN ID 5140-KE PROJECT NO P-126321
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED JUNE 30, 2014
Prepared in accordance with the Cash Basis of Accounting Method under the International Public Sector Accounting Standards (IPSAS)
.. NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
CONTENTS PAGE
l. PROJECT INFORMATION AND OVERALL PERFORMANCE .............................................................................. i
2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES .................................................................... vi
3. REPORT OF THE rNDEPENDENT AUDITORS ON THE NATIONAL URBAN TRANSPORT PROJECT ...... vii
4. ST A TEMENT OF RECEIPTS AND PAYMENTS FOR THE PERIOD ENDED 30TH JUNE 2014 ........................ 1
5. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 2014 ....................................... 2
6 STATEMENT OF CASHFLOW FOR THE PERIOD 30TH JUNE 2014 ................................................................... 3
7 STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS ......................................................... .4
8. NOTES TO THE FINANCIAL STATEMENTS .............................................................................................................. 5
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
1. PROJECT INFORMATION AND OVERALL PERFORMANCE
1.1 Name and registered office
Name: Kenya National Urban Transport Improvement Project
Objective: a) Improve the efficiency of road transport along the Northern Corridor
b) Improve the institutional capacity and arrangements in the urban transport Subsector
c) Promote private sector participation in operation, Financing and Management of transport Sector
Address:
Contacts:
Blue Shield Tower, Hospital Road Upper Hill Nairobi Kenya
Director General Kenya National Highways Authority Po Box 49712-00100 Nairobi Telephone: (254) 020 495000 E-mail: [email protected] Website: www.kenha.co.ke
1.2 Project Information
Project Start Date: 24th December 2012
Project End Date: 31st December 2018
I Project Engineer Eng Dennis Odeck
! Project Sponsor:
1.3 Project Overview
Line I
Department of the project
I I Project number
International Development Agency(IDA)
project is under the supervision of the Ministry of Transport and Infrastructure
P-126321
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
I
I
goals of the project
Achievement of strategic goals
Other impo1tant background information of the project
I Current situation that the project was formed to intervene
Project duration
strategic goals of the project are as follows:
The project management aims to achieve the goals through the following means: (i)The Implementation of policy and Institutional reforms in transport Paiticularly urban Public Transport (ii) Financing infrastructure improvements to decongest major towns necessary to support Kenya's long term Development strategy (iii)Creation of Institutional capacity to provide oversight and regulatory functions to support the delivery of urban Public the delivery of urban Public Transport Services (iv) The Preparation of appropriate investment interventions that would promote urban public mass transit systems
Upgrade the Urban Road Transport Infrastructure (total cost US$3 l I. l 5
million, of which IDA US$223.26 million). Infrastructure (total cost
US$31 l.15 million, of which lDA US$223.26 million). This component
will involve:
(a)Expanding and upgrading the Northern Corridor road section through
Nairobi from JKIA turnoff to Rironi
(b) Constructing the Kisumu Northern Bypass road
( c) Constructing and rehabilitating non-motorized transport facilities
including foot paths, cycle tracks, pedestrian bridges and underpasses.
i)-Kenya's economic development strategy ii)-Address the mounting pressures on the major urban centres, mainly Nairobi, road and related transport infrastructure and laying the foundation for developing an efficient urban public transport system
(iii) prepare a model mass transport system aimed at providing affordable
and efficient public transport services in urban areas particularly for serving
the low-income populations, especially in the CBD of Nairobi and along the
developed high density corridors; and
(iv) build the operational and managerial capacity and efficiency of urban transport agencies in dealing with urbanization and transpo1tation
The project sta1ted on 24th December 2016 and is expected to run until 31st December 2018
II
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
1.4 Bankers Kenya Commercial Bank Mai A venue Branch Po Box 30081-00100 Nairobi
1.5 Auditors Auditor General -Kenya National Audit Office Po Box 30084-0 I 00 Nairobi
1.6 Roles and Responsibilities
Names Title designation Key qualification Responsibilities
Eng M Kidenda Director General Qualified Oversight
HSC,MBS
Eng L.K Tonui General Manager Special
Qualified Oversight Projects
Eng D.Muchilwa PITL Qualified Team Leader
Eng Dennis Odeck Manager, Special Project Qualified Team Coordinator
Construction Specialist
Rose Aloo Senior Sociologist Qualified
Mr Isaac Kamotho Senior Accountant Qualified Financial Specialist
Mr Walter Nyatwanga Manager,Environment Qualified Environmental
Mr R Kile! Procurement Officer Qualified Procurement Specialist
iii
&
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
1. 7 Funding summary
The Project is for duration of 6 years from 24th December 2012 to 31st December 2018 with an approved budget of XDR 143,990,000.00 equivalent to Kshs 19,168,064,856.00 as highlighted in the table below:
Below is the funding summary: Source of
Dooor Commitment-Amount received to date - (30 Undrawn balance to date
funds 062014) (30 06 2014)
Donor Kshs
Donor Kshs
Donor currency(XDR) currency(XDR) currency(XDR)
Kshs
(A) (A') (B) (B') (A)-(B) (A ')-{B')
(0 Grant
- - - - - - -I
(iDLoan 143,990,000 19,168,064,856 - - 143,990,000 19, 168,064,856
(fu)Counterpart funds
GOK 239,518,833 194,759,986 44,758,847
Total 143,990,000 19,407 ,583,689 0 194,759,986 143,990,000 19,212,823,703
IDA XOR 19, 168,064,856
GOK XOR 239,518,833
Exchange Rate Kshs 13 3. 12
1.8 Summary of Overall Project Performance: - B d fi I u lget per ormance agamst actua amounts or current year an d ti 1 . d or cumu at1ve to- ate
Cment Year Cummulafa1e To Date
Budget 201312014 Actual 2013/2014 Perfonnance % Budget 2013/2014 Actual 201312014 Perfonnance %
964,038,005.33 112,557,187 11.68% 1,323,038,005 194,759,986 14.72%
Implementation Challenge Way forward Inclusion of Bus Rapid Transit fucilities in the design ofJKlA- Procurement of Design Review and Rironi Highway requires design cost increases in excess of Construction supervision consultant early allowed variation thresholds enough for completion of detailed design for
Bus Rapid Transit fucilities
IV
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
Preliminary design of JKIA to Rironi has been completed and draft final design of Kisumu Northern Bypass has been completed. Procurement of contractors is awaiting detailed engineering design and bid documents while documents for Request for proposal (RFP) and expression of Interest (EOI) has been shared with world bank for No Objection. Training is on going
1.9 Summary of Project Compliance: There is no significant case of non-compliance with applicable laws and regulations and essential external financing agreements /covenants was reported during the year
v
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES
The Director General, KeNHA and the Project Implementation Team Leader for National Urban Transport Improvement Project are responsible for the preparation and presentation of the Project's financial statements, which give a true and fair view of the state of affairs of the Project for and as at the end of the financial year ended on June 30, 2014. This responsibility includes: (i) maintaining adequate financial management arrangement and ensuring that these continue to be effective throughout the reporting period; (ii) maintaining proper accounting records, which disclose with reasonable accuracy at any time the financial position of the Project; (iii) designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of the financial statement, and ensuring that they are free from material misstatements, whether due to error or fraud; (iv) safeguarding the assets of the Project; (v) selecting and applying appropriate accounting policies; and (vi) making accounting estimates that are reasonable in the circumstances.
The Director General, KeNHA and the Project Implementation Team Leader for National Urban Transport Improvement Project accept responsibility for the Project's financial statements, which have been prepared on the Cash Basis Method of Financial Reporting, using appropriate accounting policies in accordance with International Public Sector Accounting Standards.
The Director General ,KeNHA and the Project Implementation Team Leader for National Urban Transport improvement Project are of the opinion that the Project's financial statements give a true and fair view of the state of Project's transactions during the financial year/period ended June 30, 2014, and of the Project's financial position as at that date. The Director General, KeNHA and the Project Implementation Team Leader for National Urban Transport Project further confirm the completeness of the accounting records maintained for the Project, which have been relied upon in the preparation of the Project financial statements as well as the adequacy of the systems of internal financial control.
The Director General,KeNHA and the Project Implementation Team Leader for National Urban Transport improvement Project confirm that the Project has complied fully with applicable Government Regulations and the terms of external financing covenants, and that Project funds received during the financial year/period under audit were used for the eligible purposes for which they were intended and were properly accounted for.
Approval of the Project financial statements
The Project financial statements were approved by the Director General, KeNHA and the Project Implqnen4t!zy; Team Leader for National Urban Transport Improvement Project on ~1" ~tw' 2014 and signed by them.
i{~_~ Eng Linus K Tonui Eng D. A Muchilwa Ag. Director General , KeNHA Ag. General Manager (SP)
vi
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
3. REPORT OF THE INDEPENDENT AUDITORS ON THE NATIONAL URBAN TRANSPORT PROJECT
REPORT ON FINANCIAL STATEMENTS
We have audited the accompanying financial statements of the National Urban Transport Improvement Project, set out on pages I to 9 which comprise the statement of receipts and payments for the financial year/period ended June 30, 2014, and a summary of significant accounting policies and other explanatory notes.
Responsibility for the Financial Statements
The Director General,KeNHA and the Project Implementation Team Leader for National Urban Transport Improvement Project are responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards (IPSAS). This responsibility includes designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error, selecting and applying appropriate accounting policies, and making accounting estimates that are reasonable in the circumstances.
Auditor's Responsibility
Our responsibility is to express an independent opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depended on our professional judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we considered the internal controls relevant to the company's preparation and fair presentation of the financial statements in order to design audit procedures that were appropriate in the circumstances, but not for the purpose of expressing an opinion on the company's internal controls. An audit also includes evaluating the appropriateness of accounting polices used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion the accompanying financial statements give a true and fair view of the state of financial affairs of the National Urban Transport Improvement Project for the financial year ended June 30, 2014 in accordance with International Public Sector Accounting Standards (IPSAS).
VII
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
REPORT ON PROJECT PERFORMANCE AND VALUE FOR MONEY ACHIEVEMENT
Based on our audit, we report that nothing came to our attention to indicate substantial nonachievement of value for money objectives. However, we identified a few minor cases of nonachievement of value for money objectives, which have been included in our separate Management Letter to the Director General,KeNHA and the Project Implementation Team Leader for National Urban Transport Improvement Project.
REPORT ON COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS
Based on our audit, we report that nothing came to our attention to indicate substantial noncompliance with applicable laws and regulations, as well as essential external financing covenants. However, we identified a few minor cases of non-compliance, which have been included in our separate Management Letter to the Director General,KeNHA and the Project Implementation Team Leader for National Urban Transport Improvement Project.
REPORT ON CONTRACTS WITH DEBARRED FIRMS
Based on our audit, we report that nothing came to our attention to indicate that debarred finns, both by the government and external financiers, were awarded any contracts under the Project during the financial year under review.
Auditor General, KENYA Date
viii
KENYA NATIONAL URBAN TRANSPORT PROJECT
Statement of Budget Performance For ended June 2014
4. STATEMENT OF RECEIPTS AND PAYMENTS FOR THE PERIOD ENDED 30TH JUNE 2014
Note Cummulative
2014 2013 to date Kshs Kshs Kshs
RECEIPTS
Transfer from Government entities 8.2 112,557,186.70 82,202, 799.13 194,759,985.83
Total receipts 112,557 ,186. 70 82,202,799.13 194, 759,985.83
PAYMENTS
Purchase of goods and services 8.3 9, 723,239. IO 2,162,472.00 11,885,711.10 Acquisition of non-financial assets 8.4 112,016,987.70 50,040,327.13 162,057,314.83 Other grants and transfers and payments 8.5 21,705.00 750.00 22.455.00
TOTAL PAYMENTS 121,761,931.80 52,203,549.13 173,965,480.93
SURPLUS/DEFICIT FOR 1HE YEAR (9,204,745.10) 29,999,250.00 20, 794,504.90
The accounting policies and explanatory notes to these financial statements are an integral part of the financial statements.
iifH~ ~:l~ Eng Linus K Tonui Eng D.A Muchilwa Ag. Director General ,KeNHA Ag. General Manager (SP)
~" 11-. ~~ ~'f Date 1!:#.r~"
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
5. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 2014
FINANCIAL ASSETS
Cash and Cash Equivalents Bank Balances TOTAL FINANCIAL ASSETS
REPRESENTE BY:
Cash and cash equivalents b/twd Sw-plus/Deficit fur the year
NET FINANCIAL POSITION
Note
8.6
8.6A
2014
Kshs
20,794,504.90
20, 794,504.90
29,999,250.00
(9,204,7 45.10)
20,794,504.90
2013
Kshs
29,999,250.00
29,999,250.00
29,999,250.00
29,999.250.00
The accounting policies and explanatory notes to these financial stateme!' ¥"integral part of the financial statements. The financial statements were approved on ~1 . 2014 and
'Jtfk~-Eng Linus K Tonui Eng D. A Muchilwa Ag. Director General ,KeNHA Ag. General Manager (SP)
~ je.11~ A3-N Date
2
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
-------·~---~---------~·
6 STATEMENT OF CASHFLOW FOR THE PERIOD 30TH JUNE 2014
Receipts for operating income
Transfer from Government entities
Payments fur operating expenses
Ptrrchase of goods and services
Other payments
Net cash flow from operating activities
CASHFLOW FROM INVESTNG ACTIV!TlES Acquisition of Assets
Net cash flows from Investing Activities
CASHFLOW FROM BORROWI:-!G ACTIVITIES
Proceeds from Foreign Borrowings
Net cash flow from financing activities
NET INCREASE IN CASH AND CASH EQUIVALENT
Cash and cash equivalent at BEGINNING of the year
Cash and cash equivalent at END ofthe year
2014 112,557, 186.70
(9,723,239.10) (21,705.00)
(112,016,987.70)
(9,204,745.10) 29,999,250.00 20,794,504.90
2013 82,203,549.13
(2,162,472.00) (750.00)
13
(50,041,077.13)
29,999,250.00
29,999,250.00
The accounting policies and explanatory notes to these financial statements forqi_ an in gral part of the financial statements. The entity financial statements were approved on _,_Jl.J_~_.:.'1'-_-"'-_.,.__ 20 l 4 and
sig~J nAA~ tftT{ vvr"- ~:l::i
Eng Linus K Tonui Eng D.A Muchilwa Ag. Director General ,KeNHA Ag. General Manager(SP)
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For thefinancialyea_r ended June 30, 2014
7 STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS
Actual on %of Receipts/Payments Item Original Budget Adjustments Final Budget Comparable Variance
Variance Basis
a b c=a+b d e=d-c F=c/co/o Receipts
Transfer from Government entities 60,000,000 I 04,038,005 164.038,005 112,557.187 51,480,819 31.38%
Proceeds from borrowing; 1,500,000,000 (700,000,000) 800,000,000 - 800,000,000 100.00o/i
Total Reeeiots l,560.000,000 (595,961,995) 964,038,005 112,557, 187 851,480,819 88.32%
Payments Purchase of goods and services 9,723,239 - 9,723,239 9,723,239 - O.OO'V<
Acquisition of non- financial assets 1,550,276,761 (595,961,995) 954,314,766 112,016,988 851,480,819 89.22%
Miscenellous Charges 21,705 Total Payments 1,560,000,000 {595,96 L995) 964,038,005 121,761,932 851,480,819 88.32% ... .. - .. -
Note: The significant budget utilisation/performance differences in the last column are explained in Annex 1 to these financial statements.
4
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
8. NOTES TO THE FINANCIAL STATEMENTS
The principal accounting policies adopted in the preparation of these financial statements are set out below:
8.1 Statement of compliance and basis of preparation
The financial statements have been prepared in accordance with and comply with International Public Sector Accounting Standards (IPSAS) with particular emphasis on Cash Basis Financial Reporting under the Cash Basis of Accounting. The financial statements comply with and conform to the form of presentation prescribed by the Accounting Standards Board of Kenya.
The financial statements are presented in Kenya Shillings, which is the functional and reporting currency of the Project and all values are rounded to the nearest one Shilling. The accounting policies adopted have been consistently applied to all of the years presented.
The financial statements have been prepared on the cash basis following the Government's standard chart of accounts. The cash basis of accounting recognises transactions and events only when cash is received or paid out by the Project.
1. Recognition of revenue and expenses
The Project recognises all revenues from the various sources when the event occurs and the related cash has actually been received by the Project. In addition, the Project recognises all expenses when the event occurs and the related cash has actually been paid out by the Project.
11. In-kind donations
In-kind donations are contributions made to the Project 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 of in-kind donations can be reliably determined, the Project includes such value in the statement of receipts and payments both as revenue and as an expense in equal and opposite amounts; otherwise, the donation is not recorded.
iii. 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. Bank account balances include amounts held at the Central Bank of Kenya and at various commercial banks at the end of the financial year. For the purposes of these financial statements, cash and cash equivalents also include short term cash imprests and advances to
5
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
authorised public officers and/or institutions which had not been surrendered or accounted for at the end of the financial year
SIGNIFICANT ACCOUNTING POLICIES (Continued)
1v. Pending bills
Pending bills consist of unpaid liabilities at the end of the financial year/period arising from contracted goods or services during the year/period or in past years/periods. As pending bills do not involve the payment of cash in the reporting period, they are simply disclosed as an Annex to the financial statements. When the pending bills are finally settled, such payments are included in the statement of receipts and payments in the year in which the payments are made.
v. 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 Project's budget was approved as required by Law and National Treasury Regulations, as well as by the participating development partners, as detailed in the Government of Kenya Budget Printed Estimates for the year. A high-level assessment of the Project's actual performance against the comparable budget for the financial year/period under review has been included in an annex to these financial statements.
v1. Exchange rate differences
The accounting records are maintained in the functional currency of the primary economic environment in which the Project operates, Kenya Shillings. Transactions in foreign currencies during the year/period are converted into the functional currency using the exchange rates prevailing at the dates of the transactions. Any foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statements of receipts and payments.
v11. Comparative figures
Where necessary comparative figures for the previous financial year/period have been amended or reconfigured to conform to the required changes in financial statement presentation.
v111. Subsequent events
There have been no events subsequent to the financial year/period end with a significant impact on the financial statements for the year ended June 30, 2014.
6
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
-----
8.2 RECEIPTS FROM GOVERNMENT OF KENYA
These represent counterpart funding and other receipts from government as follows:
2013/14 Kshs
CoW1terpa1t funding through Ministry ofTransport and Infrastructure CoW1terpait funds Quarter 1 55595,069.25 Counterpart funds Quarter 2 340, 199.00 Counterpart funds Quarter 3 135.000.00 CoW1terpmt fW1ds Quarter 4 56,486,918.45
Appropriations- in-Aid 112,557 ,186. 70
8.3 PURCHASE OF GOODS AND SERVICES
2013/14
Kshs 2012/13 Cumulative
to-date
30,000,000.00 17.161,722.00 35,041,077.13
82,202, 799.13
55595.069.25 30,340.199 .00 17.296,722.00 91.527.995.58
194,759,985.83
2012/13 Cummulative
Domestic travel and
subsistence
Kshs
9,723,239.11
Kshs
2,162,472.00 11,885,711.11
11
8.4 ACQUISITION OF NON-FINANCIAL ASSETS
Research, studies, project preparation,
design & supervision
112,016,987.70
11
50,040,327.13
13
7
I l 11.11
162,057 ,314.83
14.83
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the Jlnancial year ended June 30, 2014
8.5 OTHER GRANTS AND TRANSFERS AND PAYMENT
Bank Charges
Total
21
2013/14 Kshs
21,705.00
8.6 CASH AND CASH EQUIVALENTS C/FWD
Bank accounts (Note 8.6A)
8.6A BANK ACCOUNTS
Local Currency Accounts Opening Balance
Deficit/Surplus
Kenya Commercial Bank [A/c No.1138238945]
8.7 PENDING BILLS (Annex 2A)
2012/13
Kshs
750.00 750.00
2013/14
Ksbs
20, 794,504.89 20, 794,504.89
29,999,250.00
(9,204,745.11)
20, 794,504.89 ~-
Cumulative
to-date
22,455.00
2012/13
Ksbs
29,999,250.00 29,999,250.00
29,999,250.00
29,999,250.00
2013/14 2012/13 Ksbs Ksbs
Supply of services 44,758,097.32 112,016,987 .70
44, 758,097.32 112,016,987.70
8
NATIONAL URBAN TRANSPORT IMPROVEMENT PROJECT
Reports and Financial Statements For the financial year ended June 30, 2014
ANNEX 1 - VARIANCE EXPLANATIONS - COMPARATIVE BUDGET AND ACTUAL AMOUNTS
%of
Final Budget Actual on Comparable Budget Utilisation Utilisation Comments on Basis Variance Variance to Variance
Final Buooet a b c=a-b d=c/a%
RECEIPTS DURING THE YEAR/PERIOD
Government of 164,038,005.33
Kenva 112,557, 186.70 51,480,818.63 3 l.38o/.
Process of procuring
fa.'temal fmancing 800,000,000.00 - 800,000,000.00 100.00% contractors is in oroeress
Miscellaneous (21,705.00) 21,705.00 -
receipts
Total receipts 964,038,005.33 112,535,481.70 851,502,523.63
PAYMENTS DURING THE YEAR/PERIOD
Acquisition of non-Process of procuring
financial assets & 964,038,005.33 122,258,720.70 841, 779,284.63 87.32o/. contractors is in
Goods and
Services progress
Total payments 964,038,005.33 122,258, 720. 70 841,779,284.63 87.32%
ANNEX 2A - ANALYSIS OF PENDING BILLS
I Supplier of Goods or Date
Amount Outstanding Outstanding
Services Original Amount
Contracted Paid To-
Balance Balance Comments
Date
I 2014 2013
a b c d=a-c Supply of services
JKOOO 2, 795,884.55
491/FI Gibb Africa Consulting 03-Jun- !3 -2, 795,884.55
IJKOOO Gibb A fiica Consulting
563,874.30 -1491/FI 03-Jun-13 563,874.30 1JKOOO
18,350, 152.69 i491/F3 Gibb Africa Consulting 23-Feb-13
-18,350, 152.69
I 3 Gibb Africa Consulting 3, 700,862.84 23-Feb-13 - 3.700,862.84 _, Sheladia Associates Inc 2,870,725.07 09-Jan-14 - 2,870.725 07 2 Abdul Mullick Associates 7,061,399.07 24-Sep-13 - 7,061,399.07 3 Abdul Mullick Associates 9,415,198.80 09-Jan-14 - 9,415.198.80
Total 44,758,097.32 112.016,987.70
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