niislel audit llcdocuments.worldbank.org/curated/en/... · to: piu coordinator ts.natsagdolgor...

"NIISLEL AUDIT" LLCCertified audit, appraisal and accounting consultancy company

Date.

INDEPENDENT AUDITOR'S REPORT

To: PIU Coordinator Ts.NatsagdolgorMongolia Employment Support ProjectCredit N2: 5974-MN

We have audited the Financial Management Reports comprising the balance sheet, project sourceand uses of funds by project activity, disbursement report and the designated account statementof Mongolia Employment Support Project Credit No: 5974-MN for the period from November 5,2017 to December 31, 2018. The management of Mongolia Employment Support Project is toprepare the Financial Management Reports on the cash receipts and payments basis inconformity with International Public Sector Accounting Standards (IPSAS). On this basis, cashreceipts are recognized when received and cash expenditures are recognized when paid ratherthan when incurred. Our responsibility is to express an opinion thereon based on our audit.

We conducted our audit in accordance with International Standards on Auditing issued by theInternational Auditing and Assurance Standards Board of the International Federation ofAccountants. These standards require that we plan and perform the audit to obtain reasonableassurance about whether the interim financial reports are free of material misstatement. An auditincludes examining on test basis, evidence supporting the amounts and disclosures in the interimfinancial reports. An audit also includes assessing the accounting principles used and significantestimates made by management as well as evaluating the overall statement presentation. Webelieve our audit provides a reasonable basis for our opinion.

In our opinion, the Financial Management Reports have been prepared in accordance withInternational Public Sector Accounting Standard issued by the Public Sector Committee of theFederation of Accountants, presented fairly the cash receipts and payments of the project for theperiod from November 5, 2017 to December 31, 2018 and furthermore in all material respected,expenditure have applied to the purpose intended in the Credit No: 5974-MN.

"Niislel-Audit" LLC

Ulaanbaatar city, Sukhbaatar district, Baga toiruu-44 Phone/Fax: 31-89-18, 70120095 LtdE-mail: [email protected]

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The Government of MongoliaThe International Development Association

Credit No.5974-MNMONGOLIA EMPLOYMENT SUPPORT PROJECT

BALANCE SHEETFor the period from Nov 05, 2017 to Dec 31, 2018

Dec 31, 2018 Dec 31, 2017Balance items Note (iUD) inSD(in USD) (in USD)

ASSETSCash and cash equivalent 3 2,220,639.45 -Designated account 1,012,895.84 -Sub-account 691.92 -Cash on hand 197.84 -Operating Account MNT /EPF/ 1,206,853.85Cumulative project expenditures 4 313,751.45Goods 4(a) 105,865.12 -Consultant's services 4(b) 113,606.06 -Training and Workshops 4(c) 44,538.08 -Incremental operating costs 4(d) 49,742.19 -

TOTAL ASSETS 2,534,390.90FUNDSIDA Fund 5 2,500,000.00 -Net Interest earning 6 34,390.90 -

TOTAL FUNDS 2,534,390.90

Prepa c : Approved by:

ra i g.B Na t/agdolgor.TsFinancial Manage nt Specialist Project Coordinator

DCERT AD ACCOU INGAUDIT &APPRA SA,L


Date:..



We have audited the accompanying statement Sources and Uses of Funds Mongolia EmploymentSupport Project submitted to the World Bank for the period from November 5, 2017 toDecember 31, 2018 in support of credit withdrawals under the Credit No: 5974-MN.

We conducted our audit in accordance with generally accepted auditing standards thataccordingly included examination, on a test basis, of evidence supporting the amounts anddisclosures in the statement of Sources and User of Funds. An audit also includes assessing theaccounting principles used and significant estimates made by management as well as evaluatingthe overall statement presentation. We believe our audit provides a reasonable basis for ouropinion.

In our opinion, the statement of Sources and Uses of Funds submitted together with the internalcontrols and procedures involved in their preparation can be relied upon to support theapplication for credit withdrawals.

"Niislel-Audit" LLC

Ulaanbaatar city, Sukhbaatar district, Baga toiruu-44 Phone/Fax: 31-89-18, 70120095 r , LtdE-mail: [email protected] CC-RT



PROJECT SOURCES AND USES OF FUNDS BY CATEGORYFor the period from Nov 05, 2017 to Dec 31, 2018

SOURCES AND USES OF FUNDS Note Dec 31, 2018 Dec 31, 2017(in USD) (in USD)

SOURCESIDA Fund 5 2,500,000.00Net interest earned 6 34,390.90TOTAL FUNDS 2,534,390.90

USES OF FUNDS BY CATEGORYGoods 4(a) 105,865.12Consultant's services 4(b) 113,606.06Training and Workshops 4(c) 44,538.08Incremental operating costs 4(d) 49,742.19

TOTAL USES OF FUNDS 313,751.45

Surplus of funds over uses 2,220,639.45

Prepared b Approved by:

Uranchim g. Natsagdolgor.TsFinancial Managementf pecialist Project Coordinator

ei ismao


Date: ......... o ~


To: PIU Coordinator Ts.NatsagdolgorMongolia Employment Support ProjectCredit XM: 5974-MN

We have audited the accompanying the Statement of Expenditures (SOEs) of MongoliaEmployment Support Project submitted to the World Bank for the period from November 5,2017 to December 31, 2018 in support of credit withdrawals under the Credit No: 5974-MN.

We conducted our audit in accordance with generally accepted auditing standards thataccordingly included examination, on a test basis, of evidence supporting the amounts anddisclosures in the Statement of Expenditures. An audit also includes assessing the accountingprinciples used and significant estimates made by management as well as evaluating the overallstatement presentation. We believe our audit provides a reasonable basis for our opinion.

In our opinion, the Statement of Expenditures submitted together with the internal controls andprocedures involved in their preparation can be relied upon to support the application for creditwithdrawals.

"Niislel-Audit" LLC

Ulaanbaatar city, Sukhbaatar district, Baga toiruu-44 Phone/Fax: 31-89-18, 70120095 N!!LE AD Co.,LtdE-mail. [email protected]



STATEMENT OF EXPENDITURES (IDA Withdrawals)For the period from Nov 05, 2017 to Dec 31, 2018

WA Application Claimed Credited Amount Amountclaimed in credited Differencenumbers type date date (nUD) inSD(in USD) (in USD)

Beginning balance - -

WA-001 Replenishment 2018.04.29 2018.05.14 2,500,000 2,500,000

TOTAL 2,500,000 2,500,000

Prepar by- Approved by:

Uran im' B Natsagdolgor.Ts'Financial Managem t Specialist Project Coordinator

ta "NIISLEL AUDIT" LLCCertified audit, appraisal and accounting consultancy company

Date: 7we 77 c7U



We have audited the accompanying the Designated Account Reconciliation Statement ofMongolia Employment Support Project submitted to the World Bank for the period fromNovember 5, 2017 to December 31, 2018 in support of credit withdrawals under the Credit No:5974-MN.

We conducted our audit in accordance with generally accepted auditing standards thataccordingly included examination, on a test basis, of evidence supporting the amounts anddisclosures in the Designated Account Reconciliation Statement. An audit also includesassessing the accounting principles used and significant estimates made by management as wellas evaluating the overall statement presentation. We believe our audit provides a reasonable basisfor our opinion.

In our opinion, the Designated Account Reconciliation Statement submitted together with theinternal controls and procedures involved in their preparation can be relied upon to support theapplication for credit withdrawals.

"Niislel-Audit" LLC

Ulaanbaatar city, Sukhbaatar district, Baga toiruu-44 Phone/Fax: 31-89-18, 7020095 ilSLEL.AUDIT Co.,LtdE-mail: [email protected] CERTIFIED ACCOUNTING

AUDIT L APPRAISAL



DESIGNATED ACCOUNT RECONCILIATION STATEMENTFor the period from Nov 05, 2017 to Dec 31, 2018

2018.12.31 2017.12.31Notes

(in USD) (in USD)

Beginning balanceAdd: 2,534,390.90

Total advanced by IDA 2,500,000.00Replenishment -Interest income 34,390.90

Deduct: 1,520,605.30Goods 105,865.12Consultant's services 113,606.06Training and Workshops 44,538.08Incremental operating cost 49,742.19Operating Account MNT /EPF/ 1,206,853.85

ENDING BALANCE 1,013,785.60

PART B - ACCOUNT RECONCILIATION

Total advanced by IDA 2,500,000.00Remaining amount 1,012,895.84Add: 1,521,495.06

Sub-account ending balance 691.92Cash on hand 197.84Operating Account MNT /EPF/ 1,206,853.85Goods 105,865.12Consultant's service 113,606.06Training and Workshops 44,538.08Incremental operating cost 49,742.19

Deduct: 34,390.90Interest income 34,390.90

Total advance to DA accounted 2,500,000.00Difference

Prepared : Approved by:

Uranchimeg.B Natsagdolgor.TsFinancial Management ecialist Project Coordinator

CERT!z!,---,. YNG


Date: ,61p


To: PIU Coordinator Ts.NatsagdolgorMongolia Employment Support ProjectCredit N: 5974-MN

We have audited the accompanying Sub Accounts Statement of Mongolia Employment SupportProject submitted to the World Bank for the period from November 5, 2017 to December 31,2018 in support of credit withdrawals under the Credit No: 5974-MN.

We conducted our audit in accordance with generally accepted auditing standards thataccordingly included examination, on a test basis, of evidence supporting the amounts anddisclosures in the Sub Accounts Statement. An audit also includes assessing the accountingprinciples used and significant estimates made by management as well as evaluating the overallstatement presentation. We believe our audit provides a reasonable basis for our opinion.

In our opinion, the Sub Accounts Statement submitted together with the internal controls andprocedures involved in their preparation can be relied upon to support the application for creditwithdrawals.

"Niislel-Audit" LLC

Ulaanbaatar city, Sukhbaatar district, Baga toiruu-44 Phone/Fax: 31-89-18, 70120095 MiSLEL-AUD T Co.,LtdE-mail: [email protected] CERTIFIED ACCOUNTNG

AUDIT m APPRAISAL


Credit No.5974-MNMONGOLIA EMPLOYMENT SUPPORT PROJECTSUB-ACCOUNT RECONCILIATION STATEMENT

For the period from Nov 05, 2017 to Dec 31, 2018

Notes 2018.12.31 2017.12.31(in USD) (in USD)

Beginning balance - -

Add: 207,210.99Replenishment from DA 207,210.99 -Interest income

Deduct: 206,519.07Cash in hand MNT 10,821.53 -Consultant's services 113,606.06Training 36,401.13Incremental operating cost 45,690.35 -

Ending balance 691.92 -

Prep d by: Approved by:

Uranchi g.B Natsagdolgor.TsFinancial Manage nt Specialist Project Coordinator

,ii dcl Aud i -C



NOTES TO THE FINANCIAL STATEMENTSFor the period from Nov 05, 2017 to Dec 31, 2018

1. PROJECT BACKGROUND

On July 5, 2017, the International Development Association (IDA) and the the Governmentof Mongolia (represented by the Ministry of Finance) signed the Financing Agreement CreditNo.5974-MN (P159215) to implement the total approved credit amount is SDR 18,400,00(equivalent to original approved amount of US$ 25,000,000) and the Financing Agreement cameeffective November 5, 2017 The project closing date is September 30, 2021.

The objective of the project is to provide jobseekers and micro-entrepreneurs inMongoliawith improved access to labor market opportunities.

COMPONENTS NAMES AND SUB-COMPONENTSIMPLEMENTING AGENCY

Supporting client-centric public

employment services

2.1 Integrated employment trainingprogram

2 Strengthening select active labor marketprgrms2.2 Support for micro-entrepreneursprograms2.3 Employment promotion pilotingprogram

Facilitating labor market monitoring and 3.1 Labor market monitoring and analysis3

analysis and project management 3.2 Project management and monitoring

Component 1: Supporting client-centric public employment services (US$ 4.75 million).

Component I will address job-search constraints related to incomplete information and poor Labormarket transparency by supporting client-centric public employment services. The unifying andGuiding principle for the component will be to empower job counselors to focus on clients(jobseekers, employers, students seeking career guidance, and so on) and their core functions ofplacement and acquiring new vacancies. This will enable public employment services to be bothmore efficient and Effective in achieving quality job placements and in attracting more employersand more and higher killed job listingsComponent 2: Strengthening select active labor market programs (US$ 17.25 million).

Component 2 will strengthen the design, relevance, and demand orientation of select active labormarket programs. Based on international best practice examples and an assessment of localconditions, it will finance interventions to address the widespread lack of technical and socio-behavioral skills and of labor demand, in particular, among young people. The component willconsolidate and improve activities

MWL'l \uldi 1A,C

CEI Gt

currently financed through the existing Program for Providing Employment Skills and RetainingWork Places and the Entrepreneurship Development Program. It will have three subcomponents.

Component 3: Facilitating labor market monitoring and analysis and project management(US$ 3 million).

Component 3 will enhance the scope, quality, and availability of labor market information forinstitutional and individual users, to allow them to make informed decisions. In addition, it willprovide support for M&E and project management. It will consist of two subcomponents.

\~i~I .Ad~ A

Allocated Allocated Documented DocumentedCategory amount amount amount amount USD%

(in SDR) (in USD) (in SDR*) (in USD)Goods, works, non-consultingservices, consultants' services,Training and Incremental Operating 6,570,000 8,926,609Costs for Non-EPF Activities underParts 1, 2 (a) (vii), 2(b) (iii), 2(c) (ii)and 3 of the ProjectNon-consulting services, consultants'services, Training, Micro-loans andEmployment Promotion Piloting 11,830,000 16,073,391Grants for EPF Activities under Parts2 (a) (i) to 2(a) (vi), 2(b) (i), 2(b) (ii)and 2 (c) (i) of the Project

TOTAL AMOUNT 18,400,000 25,000,000 -

Note: Actual disbursement in USD as of December 31, 2018 have been tanslated into SDR attheexchange rate: 1XDR=.41]834US. li,p i:

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) Statement of compliance: The Interim Financial Reports comprise Balance Sheet, Uses ofFunds by Category, Uses of Funds by Project Activity, Disbursement report and the DesignatedAccount Statement.These reports have been prepared as agreed with the World Bank.

b) Basis of preparation: The financial statements were prepared in accordance with InternationalPublic Sector Accounting Standards (IPSASs) issued by the International Public SectorAccounting Standards Board (IPSASB) of the International Federation of Accountants.Thefinancial statements have been prepared on a cash basis. On this basis, cash receipts arerecognized when received and disbursements are recognized when paid rather than whenexpenses are incurred. The project financial activities carried out in compliance with the projectFinancial management manual which has been accepted by the World Bank.

The reports are operated and maintained by the financial management information system,named PACS, designed by the Infosystems LLC capable of generating IFRs in accordance withformats agreed with the Bank.

c) Basis of measurement: The financial statements are presented in U.S.Dollar (USD). Thepayments made by Mongolian currency (MNT) which were transferred into USD based onofficial exchange rate, as of the date of payment.

d) Basis of presentation: The account balances in the Financial statements covers transactionsbetween Nov 5, 2017 to December 31, 2018.

e) Designated account: Project opened the Designated Account (DA) for the credit financingacceptable to the World Bank. The ceiling of the designated account is USD 3,000,000 (threemillion). DA is located in State Bank and maintained in USD by Ministry of Finance, account

CERT~IFIr;CAWT fING jJA U I ,~"I P ,;

number 106000056853 The payments for the eligible expenditures of goods (over USD100,000), Micro loans (USD 1,000,000), training and Employment promotion piloting grants(over USD 150,000) are paid fi-om DA.

t) Sub-accounts: As specified in the Disbursement Letter, the project opened the MNT Sub-account (SA) for the credit financing acceptable to the World Bank. Accordingly, expendituresexpressed by MNT will be financed from SA (MNT).

3. CASH AND CASH EQUIVALENTS

The PIU has opened project designated accounts and sub-accounts to manage the projectassets.The ending balance of the cash and cash equivalents as of 31 December 2018 are shownbelow:

Project Bank AccountDecember 31, 2017 December 31, 2018

(in USD) (in USD)

Designated account - 1,012,895.84

Sub-accounts - 691.92Cash on hand - 197.84Operating Account MNT /EPF/ 1,206,853.85

TOTAL - 2,220,639.45

4. CUMULATIVE PROJECT EXPENDITURES

The cummulative disbursement is indicated by categories as follows:

Total allocated Total Total

Disbursement Categories budget as cumulated disbTot Disbursementindicated in disbursement disursement percentage %

PAD amount amount 2018Goods, works, non-consultingservices, consultants' services,Trainingand IncrementalOperating Costs for Non-EPF 8,926,609.00 313,751.45 313,751.45 3.51%Activities under Parts 1, 2 (a) (vii),2 (b) (iii), 2 (c) (ii) and 3 of theProjectNon-consulting services,consultants' services, Training,Micro-loans and EmploymentPromotion Piloting Grants for 16,073,391.00 -EPF Activities under Parts 2 (a) (i)to 2 (a) (vi), 2 (b) (i), 2 (b) (ii) and2 (c) (i) of the Project

TOTAL 25,000,000.00 313,751.45 313,751.45 3.51%

CERT!FI P!J N G /9A UD!7 L

5. INTERNATIONAL DEVELOPMENT ASSOCIATION'S FUND

As of December 31, 2018 the project had received USD 2,500,000 (10% of the total credit) throughthe Designated Account as financing from IDA Credit No:59740-MN and had disbursed USD313,751.45.

WA Application Credited Amount Amountnumbers type Claimed date date claimed in credited in

(in USD) (in USD)

WA-01 2018.04.29 2018.05.14 2,500,000.00 2,500,000.00TOTAL 2,500,000.00 2,500,000.00

6. INTEREST EARNING

For the reporting period, total accumulated interest income of the designated account and sub-accounts are:

Bank category December 31, 2017 December 31, 2018(in USD) (in USD)

Designated account (USD) 34,390.90

TOTAL 34,390.90

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(4c) Training and workshop:The total disbursed amount for the training are:

Training Number Number ofComponent Names 2018.12.31 and of the the(in USD) Workshop training participants

(in USD)Supporting client-centric public 44,538.08 44,538.08 2 25employment services

TOTAL 44,538.08 44,538.08 3 478

(4d) Incremental operating cost:The total disbursed amount for the incremental operating costs are:

Total amount TOTALDescription 2018.12.31 (in USD)(in USD)Cumulative dishursement amount before the repotWngperiod

Operating cost of the project 49,742.19 49,742.19

TOTAL AMOUNT 49,742.19 49,742.19

"'.N6,f Audit

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