PAL SECRETARY STATE -PARTMENT FOR THE ASALS AL DEVELOPMENT 0 7 DEC 'J REPUBLIC OF KENYA ILI - .0Annlversary Towers E-mail: info@oagkenya.go.keMorvaSet Website: www.oagkenya.go.ke OFFICE OF THE AUDITOR-GENERAL P Enkancing Accountability N AIRO BI OAGIKDRDIP/2022/20231(10) 6 December, 2023 The Principal Secretary State Department for ASALs & Regional Development P.0 Box 40213-00100 Dear Sir, REPORT OF THE AUDITOR-GENERAL ON KENYA DEVELOPMENT RESPONSE TO DISPLACEMENT IMPACTS PROJECT (KDRDIP) IDA CREDIT NO.0214-KE AND GRANT NO. TFOA 7762-KE FOR THE YEAR ENDED 30 JUNE, 2023 - MINISTRY OF EAST AFRICAN COMMUNITY (EAC). ASALS AND REGIONAL DEVELOPMENT Your responses dated 21 November, 2023 in respect of the Management Letter for the financial year ended 30 June, 2023 refers. The additional information and evidence provided in the responses have been examined and considered. Enclosed, herewith please find one set of the report of the Auditor-General on Kenya Development Response to Displacements Impacts Project (KDRDIP) IDA Credit No. 6021-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 duly certified and with the seal thereon for your retention and necessary action. Yours faithfully, A.S Mohamed Copy to: Project Coordinator Kenya Development Response to Displacement Impacts Project (KDRDIP) IDA Credit No. 6021-KE and Grant No. TFOA 7762-KE P.O BOX 40213-00100 Regional Offices: Nairobi * Nakuru * Eldoret * Embu * Garissa * Kakamega * Kisumu* Mombasa * Nyeri Bungoma Kisli Machakos ., ' F ��3-i�TJ�i.\.i VF ЛgВчБТ��гi 5 1 У .. , . '` t . . . , ; ... . . . ... � �'\ .. . . .� ` _1 �� х �, _.. �F • � �i' •:..i�i ���'�1 �.^�'�~!��#К��У � S :..�; ���,� ��ьаМ.�д���,��� . . .. . ����� , .. .. • . . �� . � - . , . � . � . ' ���г� � V �/ i�������� .. . . . ' ' . 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И_ � � .. �t�p�'��,М1д1� FIC T AV 3 Noy 2g23 THE REPUBLIC OF KENYA Project Name: Kenya Development Response to Displacement Impacts Project (KDRDIP) Implementing Entity: Ministry of East African Community (EAC), The ASALs and Regional Development PROJECT GRANT NUMBR TFOA7762-KE AND CREDIT NUMBER: IDA 6021 O-KE ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED JUNE 30, 2023 Prepared in accordance with the Cash Basis of Accounting Method under the International Public Sector Accounting Standards (IPSAS) KDRDIP Project Annual Report and Financial Statements for Thefinancial year ended June 30, 2023 1. Contents 2. A bbreviations and A cronym s ..................................... ............................................................... i 3. Project Information and Overall Performance............................................................................. iv 4. Statement of Performance against Project's Predetermined Objectives...............................xvi 5. Environmental and Sustainability Reporting................................................................................Xxi 6. Statement of Project Management responsibitiesi ..................................................................Xxiv 7. Report of the Independent Auditor on Financial Statements for Kenya Development Response to Displacement Impacts Project.............................................................................Xxvi 8. Statement of Receipts and Payments for the year ended 30th June 2023..............................1 9. Statement of Financial Assets as at 30h June 2023.................................................................. 3 10. Statement of Cash flow for the year ended 30th June 2023....................................................... 4 11. Statement of Comparison of Budget and Actual amounts for year ended 30 June 2023.... 5 12. Significant Accounting Policies.................................................................................................... 6 13. Notes to the Financial Statements ............................................................................................... 13 A n n e x e s ................................x................................................................................ 20 KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 2. Abbreviations and Acronyms CBK Central Bank of Kenya ICPAK Institute of Certified Public Accountants of Kenya IMF International Monetary Fund IPSAS International Public Sector Accounting Standards NT National Treasury PFM Public Finance Management. PSASB Public Sector Accounting Standards Board WB World Bank KDRDIP Kenya Development Responses to Displacement impacts project CDD Community Driven Development CSC Community steering committee CDP Community development partner CTC Community Technical Committee PSASB Public Sector Accounting Standards Board PFM Public Finance Management UJNHCR United Nations High Commissioner for Refugees CGS Community Groups SP Sub Projects CIDPs County Integrated Development plan GRCs Grievance Redress Committees CIPIUs County Integrated Project Implementation Units NPIU National Project Implementation Unit VLCs Village Level Committees CPMCs Community project management committees SACs Social Audit committees CGMCs Community groups management committees LIPW Labour intensive public works WAUs Water Users Association PISTs Project Implementation Support VLCs Village Level Committee CDPs Community Development Plans GRM Grievance Redress Mechanism NEMA National Environment Management iii KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 3. Project Information and Overall Performance 2.1 Name and registered office Name The project's official name is Kenya Development Response to Displacement Impacts Project (KDRDIP). Objective The key objective of the project is to improve access to basic social services, expand economic opportunities and enhance environmental management for communities hosting refugees in the target areas. Address The project headquarters offices are Harambee House (city) Nairobi County, Kenya. The address of its registered office is: P.O Box 401213-00100 Nairobi. The project also has offices/branches as follows: * Turkana * Wajir * Garissa Contacts: The following are the project contacts P.O. Box: 401213-00100 Telephone: (254) (020)2217696 or 2227411 E-mail: info@kdrdip.go.ke Website: wwy.kdrdip.go.ke iv KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Project information and overall performance (continued) 2.2 Project Information Project Start Date: The project is 01/07/2017 Project End Date: The project end date is the 31/12/2023 Project Manager: The manager is Mr. Wilfred Omari Project Sponsor: The World Bank 2.3 Project Overview Line The project is under the supervision of the Ministry of East African Community (EAC), Ministry/State ASALS and Regional Development Department of the project Project Number IDA 602 10 -KE AND GRANT TFOA7762-KE Strategic goals The strategic goals of the project are as follows: of the project i. The strategic goal of the project is as follows: -Address social, economic and environmental impacts due to the presence of refugee host communities. Summary of The project management aims to achieve the goals through the following means: Project 1(i) Implementation of community investment subprojects and livelihood support Strategies for within the host communities. achievement of iii) Address the both social and environmental safeguards as they emerge during strategic goals implementation. V KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Other important The development objective of the Development Response to Displacement Impacts background Project (KDRDIP) for Kenya is to improve access to basic social services, expand information of economic opportunities, and enhance environmental management for communities the project hosting refugees in the target areas in the Recipient's territory. The project comprises of four components. i. The first component, social and economic infrastructure and services will specifically support improvements in access to quality basic services for the host communities, ii. The second component, environmental and natural resource management aims to decrease environmental impacts of protracted refugee presence which has resulted in deterioration of the natural resource base because of deforestation resulting from the overexploitation of wood and other non-timber forest products for various purposes (shelter, firewood, charcoal, food, medicines, and so on), degradation of grazing lands, loss of wildlife, soil erosion, open disposal of solid waste (especially plastics), and uncontrolled abstraction of groundwater for domestic consumption and livestock. iii. The third component, livelihoods program will support interventions aimed at improving the productivity of traditional and non-traditional livelihoods and strengthening the resilience of communities. It consists of following sub- components: (i) support to traditional and non-traditional livelihoods; and (ii) capacity building of community-based organizations for livelihoods. iv. The fourth component, project management, monitoring and evaluation (M and E), and knowledge sharing objective is to ensure enhanced and effective project management, coordination, and implementation and to support the design of the project's M and E system. The project being a regional initiative adopted the Community Driven Development approach for implementation of its activities in which Community participation in all Phases of the Project cycle is the key feature. Areas that the The project was formed to intervene in the following problems/gaps: project was i) Social and Economic Infrastructure Services. formed to ii) Environment and Natural Resource Management intervene ii) Support both traditional and non-traditional livelihood interventions. Project duration It is a five-year project that started on Ist July 2017, but on a no cost extension up to 3 1st December 2023 Vi KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 2.4 Bankers The following are the bankers for the project: The Central Bank of Kenya, Haile Selassie Avenue, P. 0. Box 60000, City Square 00200, Nairobi, Kenya. 2.5 Independent Auditor The project is audited by the, The Office of Auditor General Anniversary Towers, University Way P 0 BOX 30084-00 100, GPO Nairobi, Kenya. Vii KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 2.6 Roles and Responsibilities The following is the list of Project Staff, their academic qualifications and responsibilities: - Principal Secretary * Master's Degree in Public DAccounting Officer State Administration & Policy. Department for ASALs and Bachelor's Degree in Regional Development Education. Kello Harsama Project Manager * MA. Economics *Overall Project management * MA, International and coordination, including Relations planning, supervision, * NDC Kenya Financial Management, * Accredited Knowledge monitoring and Evaluation Management Consultant KDRDIP A.I.E holder. Wilfred A.0mari * SLDP 23 OGW,'ndc'(K * Risk management (ESAMI) Head Component Bachelor of science a Head Social economic, One infrastructure, and services In charge of Water sector Josephat Waweru, HSC Head Environmental PHD,Environmental *Support to Project and Resources Governance and Coordination and Management Management, implementation, e MSC, Environment Specifically responsible for Science and Technology environment conservation. * BSc. Forestry man agent of natural * Certificate Reforestation resources and support to techniques policy advisor Dr. John Ngatia * Head Component * MA. Social Science. * Handholding and overall Three * BA (Double Major supervision of livelihood Political Science and activities Sociology Geoffrey Leparteleg Vi1 KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 * Project Accountant * Bachelor of Ccommerce * Maintenance of Project (Finance option) Accountable Documents. * CPA(K) * Submission of Quarterly * Member of ICPAK. Interim Financial Reports * Senior Management * Withdrawal applications Course (KSG) * Exchequer Requisition * Project Management * Maintenance of Project (ESAMI) cashbooks Sarah Mauta * Agriculture * Bachelor of Science in * Offer technical Specialist Agricultural Economics backstopping to facilitate * Master of Arts in the implementation of Project Planning and NRM Subprojects John arumnManagement * Social Safeguard * MA. Project Planning *Promotes Stakeholders Specialist and Management consultation and engagement eSafeguard Instrument Review Wycliffe Wangwe *Gri evance Redress Mechanism Social Safeguard *BSc Animal Production Promotes Stakeholders Specialist * Certificate in consultation and Environmental and engagement Social * Safeguard Instrument * Safeguards Review Management * Grievance Redress Mechanism Judy Gachora * Finance Specialist I* B.Com. (Finance) * Budget preparation. CPA(K) planning and costing for all MBA(Finance) project activities *Member of ICPAK *Preparation and * er eet consolidation of the Project Course (KSG) AWPB * Public Financc * Preparation and issuance of Lucy W. Gathenga Management (ESAMI) AlEs for office and preparation of monthly and quarterly reports. KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Assistant * MSc. Climate Change *fmplementation support and Environmental Science. monitoring of subprojects, Safeguard * BSc. Natural Resource *Promotes Stakeholders Specialist Management (Forestry) consultation and engagement Safeguard Instrument Review *Grievance Redress Janet Tulula Mechanism Assistant * BSC. Applied Statistics eSupport Project Monitoring Monitoring and and Evaluation. Evaluation Specialist Andrew Loreng *ICT Specialist * Masters in Computer and * System administrator for Radio Communications the KDRDIP's MIS; Engineering. * Maintenance of ICT, * Bachelor of Business Hardware, Software, and Information Technology. Systems including websites, * Diploma in Computer email and video Studies. conferencing system; Anthony Karoki* Advising on ICT-related issues; Procurement * MBA (Finance) Procurement planning and Specialist * Bachelor of commerce execution * CIPS * CPA 11 David Mamati * Communication * MA Corporate * Public Communication Speciatist Communication a Leadership knowledge * BA - Linguistics management secretariat and * Post Graduate Diploma awareness creation. Strategic Leadership Course Moses Nyandika * Senior Management Course (SMC) x KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 2.7 Funding summary The Project is for duration of 5 years from 2017 to 2022 but due to technical and systematic delays it is on a no cost extension up to 31 ' December 2023 with an approved budget of US$ 111,580,000 (which is equivalent to Kshs 11,580,000,000 as highlighted in the table below: Summary of Overall Project Performance: This Implementation Progress report takes stock of the inputs, outputs and outcomes of the project activities since inception to the third quarter of Financial Year 2022/23. The report covers the status of implementation of sub-projects under Component I and 2; livelihood programme activities and other support endeavours in awareness creation, knowledge management and monitoring and evaluation. The Project covers a total of five sub-counties and 31 wards. In Garissa, the project covers Daadab, Lagdera and Fafi Sub-Counties with 17 wards. Dadaab comprises of six wards namely: Daadab, Labasigale, Damajaley, Liboi, Abakaile and Dertu Wards while Lagdera hosts Modogashe, Benane, Goreale, Maalmin, Sabena and Baraki Wards. Fafi is made of Fafi, Nanighi, Bura, Dekaharja and Jarajilla. In Wajir, the project covers Wajir South Sub-County which comprises of seven wards namely: Diff, Benane, Burder, Darajabulla, Habasweni, Logboghol South and Ibrahim Ure. In Turkana, the project is implemented in Turkana West Sub-County with seven wards. The Wards are Letea, Songot, Kalobeyei, Lokichogio, Nanam, Kakuma and Lopur. Figure I below shows the potential beneficiaries per ward while Annex 6, provides the population of villages in each of the war Xi KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Project information and overall performance (continued) Below is the funding summary: A. Source of Funds Source of funds Donor Commitment- Amount received to date - Undrawn balance to date (30 June, 2023) . .. ne, 202) Donor KShs Deor KShy Donor KShs curreny currency currency USD (USD) (USD) A ___= (A (B) (9') (A;-(B)A-B' GRANT SUMMARY Danida 11,580,000 1,158,000,000 7,986,4991 854,654,576 3,593,501 303,345,424 Total Grants 11,580,000 1,158,000,000 7,986,499 854,654,576 3,593,501 303,345,424 LOAN SUMMARY World Bank - IDA 100.000,000 10,000,000,000 88,294,217 10,140,539,439 11,705,783 -140,539,439 Total Loans 100,000,000 10,000,000,000 88,294,217 10,140,539,439 11,705,783 -140,539,439 Total Funding 111,580,000 11,158,000,000 96,280,716 10,995,194,015 15,299,284 162,805,985 Summary B. Application of Funds Applicatio Amount received to date - (30th Cumulative amount paid to date Unutilised balance to date n of funds June 2023) - (30th June 2023) (30th June 20293 Donor Ksks Donor Kshs Donor Esks currency USD currency currency (A) (A) (B) (B') (A)-(B) (A?B& ) Grant Danida 7,986,499.00 854,654,576.00 7,986,499.00 854,654,576.00 3,593,501.00 303,345,424.00 _ii) Loan World 84,156,109.54 8,829,454,232,00 60,598,258.54 6,059,825,854.00 27,696,283,78 2,769,628,378,00 Bank - IDA Total 96,281,041.32 9,684,108,808.00 68,584,757.54 6,914,480,430.00 31,289,784.78 3,072,973,802.00 xii KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30,2023 Project information and overall performance (continued) 3.8 Summary of Overall Project Performance: i) Budget performance against actual amounts Jbr current year and for cumulative to-date, ii) Physical progress based on outputs, outcomes, and impacts since project commencement, KDRDIP was founded on the philosophy of citizen participation and engagement in the process of identifying, prioritizing, awarding of tenders, implementation, supervision, monitoring, reporting and accounting of their community investments. This aimed to increase the voices and roles of citizens in decision-making regarding development, and eliciting a greater demand for social accountability. In order for this to happen, the Project established community structures that supported implementation of the Project. The structures (committees) were elected by the beneficiary community members at village assemblies. The committees were Village Level Committees (VLCs), Grievance Redress Committees (GRCs), Social Audit Committees (SACs), Community Project Management Committees iCPM-Cs), and Community Group Management Committees (CGMCs). The compositon of the committee members took into account gender representation (no XIi KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 committee could have more than a third of either gender), vulnerable groups (people living with disabilities, minorities and elderly), and youths. Community Project Management Committees A total of 1,874 CPMCs were formed since the beginning of the Project (FY2019/2020 to FY2022/2023). The committees helped to implement sub-projects under Component 1 and 2 (Infrastructure and LIPW). The CPMCs were formed as per the agreed annual work plans and budget. Under Component 1, the CPMCs comprised of existing school management boards, health management boards, Water Users Associations (WUAs) among others. The committees were entrusted with advertising of tenders, procurement, site handover to contractors, and supervision of the implementation of sub-projects. They also made payments and handed over completed sub-project to beneficiary users. Technocrats, from the National and County Governments, referred to as Project Implementation Support Teams (PISTs) worked with CPMCs for quality control and supervision. Under Component 2, a total of 534 CPMCs were formed to supervise Labour-Intensive Public Works (LIPW) and clean energy provision activities. The Component 2 CPMCs procured tools and materials for LIPW sub-projects and handed over community assets to users. In total, 6,700 community members participated in management of the sub-projects under component I, comprising of 1,305 in Dadaab; 850 in Fafi; 650 2 2 4 w in Lagdera; 2,405 in Turkana West and 1,490 in Wajir South Sub- Counties. A total of 2,670 people participated in the CPMCs under Component 2. Community Group Management Committees (CGMCs) The CGMCs were formed under Livelihood Programme to ensure CGs compliance to rules and arrange technical appraisals of business plans. A minimum of three CGs formed a Village Level Livelihood Sub-Committee. The office bearers comprised of a president, secretary, treasurer and a bank signatory. A total of 4.577 CGMCs were established across the 5 sub-counties. This comprised of a total of 22,885 host community members. Turkana West had the largest number of members in CGMCs (8,125 people), followed by Wajir South (4,745), Dadaab (3,855), Fafi (3,560) and Lagdera (2,510) Xiv KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Village Level Committees/Social Audit Committees/Grievance Redress Committees Each village formed a Village Level Committee (VLC) and a total of 135 VLCs were established in the five sub-counties. The purpose of VLCs was to coordinate village level Community Development Plans (CDPs). A VLC comprised of five members drawn from men, women, youths and representatives of the differently abled populations. Social Audit Committees (SACs) performed internal monitoring functions and periodic audits (including financial) of project activities and reported their findings directly to the Village Assemblies. The committee observed the functioning of VLCs including village- level livelihoods sub-committee, LIPW sub-committees as well as adherence to project principles and rules. Grievance Redress Committees (GRCs) created awareness of the Grievance Redress Mechanism (GRM) and project. It maintained records of grievances and redress mechanisms. A total of 135 GRCs, like VLCs and SACs, were formed across the five sub-counties. Roles and Responsibilities of the Host Community The sovereign power of the Project emanated from the host beneficiary community. Decisions or Project implementation began and ended with the community. The community identified social and environmental risks and mitigating measures; ensured inclusivity and equity in projects including vulnerable and marginalized groups; participated in the environmental and social safeguards development process; infused local Knowledge and promoted wide community involvement in identification of sub-projects including women, minorities. KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Other roles and responsibilities of the community included promotion of transparency and accountability in all decisions; prevention of elite capture, cronyism and misuse of funds; helped to identify the county 1 4: l!"vne 'moui. if?T La,dcra~ S~uh-(- i, eh,fz, ii L' "w'i ft, 1)"vlp r development priorities beneficial to the society. Communities identified areas of potential conflict in the design and implementation of the sub-projects; donated land for identified and agreed sub-projects. It monitored implementation of the environmental and social management plan by contractors and promoted inclusivity in order to ensure ownership and sustainability of the Project interventions, iii) Project budget absorption rate since the commencement. FY 2022-2023 FY 2021-2022 FY 2020-2021 FY 2019-2020 Ksbs. Kshs. Kshs. Kshs. Approved Budget 2,981,000,000 3,700,000,000 3.500,000,000 1.000.000,000 Actual 2,761.611,609 3,403,403,059 3.308,061,239 893,330.915 Absorption rate 93% 92-o 95% 89% iv) Project implementation challenges and recommended steps. a) Heavy workload with few staff: - The Government to identify and deploy more technical and support staff. b) Poor staff morale, over stretched and overworked staff with same pay. Going forward staff be considered for top-up allowance or extraneous allowance. c) Delayed Accountability from the communities; Increase number of Accounts personal both at NPIU and CIPIUs to assist in collecting accountabilities from the communities, d) Frequent court cases: Punitive measures and heavy penalties be given to those abusing judiciary process to derail project implementation, alongside encouraging out of court settlement of cases. XV] KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 e) Illiteracy of the project beneficiary communities; Continuous advocacy and lobbying for communities to find support in project implementation. f) The project beneficiary communities are nomads in nature; Sensitization and provision of the basic amenities and services required by the project beneficiary communities i.e. continuous provision of access to basic social services like water for domestic and livestock, construction of schools, hospitals etc. g) Complexity of the project design; Continuous capacity building and awareness to community members and other stakeholders to understand and appreciate 2.9 Summary of Project Compliance: i) No significant cases of non-compliance encountered. ii) No consequences suffered on account of non-compliance or likely to be suffered iii) No cases of non -compliance encountered hence no mitigation measures taken or planned to be taken to alleviate the adverse effects of actual or potential consequences of non-compliance. 4. Statement of Performance against Project's Predetermined Objectives Introduction Section 81 (2) (f) of the Public Finance Management Act, 2012 requires that, at the end of each financial year, the Accounting Officer when preparing financial statements of each National Government entity in accordance with the standards and formats prescribed by the Public Sector Accounting Standards Board includes a statement of the national government entity's performance against predetermined objectives. KDRDIP will ensure that citizens participate and engage in the process of identifying and prioritizing their developmental needs, including expanding socioeconomic infrastructure and livelihood opportunities to improve self-reliance among refugee-hosting communities, improving social cohesion between refugees and host communities, increasing the voices and roles of citizens in decision making regarding development, and eliciting a greater demand for social accountability. The operational approach will be Community-Driven Development (CDD) and will involve (a) supporting grassroots institutions to be more inclusive and representative, and build their capacities; (b) ensuring that the voices of all communities/groups are heard in the decision-making process; (c) strengthening decentralized xvii KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 government administrative functions; and (d) investing in public service delivery and contributing to social cohesion among beneficiary communities. The key development objectives of the project's agreement/plan are to: a) Improve access to basic social services b) Expand economic opportunities c) Enhance environmental management for communities hosting refugees in the target areas. d) Implementation of 2022/2023 Annual Work Plan and Budget During the FY 2022/2023 the project disbursed Kshs. 2.179 Billion to carry out various Project activities across all the components as follows: Total S/NO. COMPONENT SUB COUNTY NUMBER Ps/CGs AMOUNT NUBROF SP,G JMUTKSHS.) Turkana West 89 345,608,000 Wajir South 64 186,364,763 Dadaab 36 188,763,595 Fafi 30 110,300,000 Lagdera 26 129,186,966 Sub Total 245 960,223,324 Turkana West 30 208,780,000 Wair South 26 110,228,673 Dadaab 28 85,758,198 Fafi 29 91,589,808 Lagdera 17 58,698,521 Sub Total 130 555,055,200 Turkana West 354 214,000,000 Wajir South 101 91,000,000 Dadaab 105 74,500,000 3 COMPONENT 3 Fafi 82 38,500,000 Lagdera 35 58,500,000 Sub Total 677 476,500,000 Turkana West 72.945,000 4 COMPONENT 4 Wair South 53.975,000 Garissa 60,655,000 Sub Total 187,575,000 TOTAL DISBURSEMENT L 2,179,353.524 Xi KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Progress on attainment of strategic development objectives For purposes of implementing and cascading the above development objectives to specific sectors, all the development objectives were made specific, measurable, achievable, realistic and time-bund (SMART) and converted into development outcomes. Attendant indicators were identified for reasons of tracking progress and performance measurement: Below we provide the progress on attaining the stated objectives. Project Objective Outcome Indicator Performance KDRDIP The Pject improved access to No. of water facilities 99no. water Development Objective Social and economic funded towards facilities (PDO) is to improve services constructed/rehabilitated funded access to basic social No. of health facilities 35no. health services, expand funded for facilities coorniTc construction/renovation funded opportunities, and Mofra9n.frad enhance environmental KMs of road 9no. of roads management for ructed funded communities hosting No. of School facilities 89no school refugees in the target funded for construction facilities areas. / renovation funded No. of sanitation and 5No sanitation solid waste facilities and solid waste constructed facilities No. of market 8no. of market infrastructure facilities infrastructure constructed funded Restored.rehabilitated lHectares of land Various environment and restored and activities Natural rehabilitated funded to resources rehabilitation of 342 Ha of land Livelihoods No. of SHGs 676 improved and no. livelihood communities' groups funded resilience strengthened XiX KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Component One During the Financial Year 2022-2023, the component was allocated Ksh. 947 M to be utilized to implement 245 sub projects across the five sub counties as follows: Sector Waiir Turkana FA L_14der Dadaab Total Water 30 40 4 12 13 99 Health 6 15 4 3 7 35 Roads 3 4 2 - - 9 Education 23 29 8 21 8 89 Markets and 2 1 3 - 2 8 infrastructure Sanitation - 5 - 5 Total 464 89 26 36 30 245 Component Two The implementation of Component 2 sub-projects funded in the previous years continued towards completion and operationalization of exit strategies - planned, maintenance and operations. Currently, initial implementation activities for the financial year 2022-2023 sub-projects is ongoing and most documentation has been completed. S/N4Ag~~~~yj ___ __ __ _ _ _Remarks_ _ 1. Development of micro-catchment plan and subsequent multi-year plan Completed_(100%) 2. Identifications & list of vulnerable households, heads and dependant Completed (100%) 3. Identification of individuals households chgible for LIPW Completed (100%) 4. Feasibility assessment and technical designs where structures are parts of Completed (100%) interventions 5. Other requirements Completed (100%) * Operation &maintenance plan * Implementation plan * Procurement plan 8._ Formation and training of CPMCs for community assets Completed (100%) 9. enng of Bank accounts for Community assets (Sub-Projects) Completed (100%) 10. Safeguards Screening _ __ Completed (100%) 12. Development of BoQ and Tender Documents for all sub-proects Completed( 13. Supporting CPMCs in Tender process for non-wage items. (Advert, Completed (100%) openingand evaluation) 14. Implementation of Sub-projects (Actual Works) Completed (50%) 15. Monitoring and Supervision of Works Continuous xx KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Component Three In the financial yea- 2022/2023, the component supported 645 community groups and 31 producer organizations. The 645 community groups were distributed across the five sub counties as follows: Turkana West 346; Dadaab 99; Wajir South 94; Fafi 77; and Lagdera 29. While, the 31 producer organizations were identified and distributed as follows: Turkana West 7; Wajir South 7; Dadaab 6; Fafi 5; Lagdera 6. by the close of financial year 2022/2023, the component 3 had supported 4,577 community groups against original target of 4000 community groups and 31 producer organizations original target of 25 producer organizations translating into 59,501 beneficiaries. 5. Environmental and Sustainability Reporting KDRDIP exists to transform lives. This is our purpose, the driving force behind everything we do. It's what guides us to deliver our strategy. Below is a brief highlight of our activities that drive towards sustainability. 1. Sustainability strategy and profile The project interventions are in hard-to-reach areas, very remote, poor road network, insecurity and high illiteracy levels There are laid down implementation structures from village up to national levels. At each stage there are specific deliverables including Memorandum of Understanding with respective communities and County Governments. There are clear operation and maintenance plans that details what happens after project implementation completion including sustainability 2. Environmental performance The project manages the environmental impacts of protracted refugee presence which has resulted in deterioration of the environment and the natural resource base due to deforestation, degradation of grazing lands, competition for pasture, loss of wildlife, soil erosion, open disposal of solid waste (especially plastics), and uncontrolled abstraction of groundwater. Each intervention must meet World Bank Environmental and social safeguards, NEMA and WRMA requirements included certification. The project supports environmental and natural resource restorative measures that rehabilitate and improve the productivity of the natural resources and support other productive systems such as irrigated agriculture, access to water for humans and livestock, pasture development, including value addition for livestock and agricultural products. The interventions include rehabilitation of degraded sites, agro-forestry, management of solid wastes (plastics) and provision of alternative energy sources such as solar, wind, and provision of access to improved energy-saving devices. xxi KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 3. Employee welfare The project has two types of staff; regular and contract. The regular staff are drawn from relevant Ministries, Department and Agencies and are governed by the Human Resource Policy Manual 2017. Those on contract are employed as individual consultants as per World Bank Procurement Regulations (revised 2017). 4. Market place practices- The organization should outline its efforts to: a) Responsible Supply chain and supplier relations- The project uses both Public Procurement Regulation and World Bank Procurement Regulations (Revised 2017) b) Responsible Ethical practice. The Project adheres to Kenya Ethic and Anti-Corruption Commission Regulation and World Bank Anti-Corruption Regulation. c) Regulatory Impact assessment- The Project adheres to Public Finance Management Act and Regulations in its intervention, which has been cascaded into implementation manuals. 5. Community Engagements The community members through a consultative process wish list/needs propose community Development Plans (CDPs). Once the communities are identified, they are mobilized, sensitized and organized into: i.Committees. ii.The aggregated Sub county CDPs are submitted to county Technical Committee composed of County Integrated Development Plan (CIDPs) and other sectoral plans for sustainability. iii,The communities in their first public gathering elects 5 members (men, women, youth and persons enabled differently) to form the village level committees iv.The Consolidated Ward CDPs are submitted to sub-county for the Project Implementation support Teams to appraise and aggregate into Sub-county CDPs with the support of CIPIUs and NPIU. xxii KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 v,.The village level committee with the assistance of a community facilitator identifies and prioritizes community felt needs in a public meeting where all community members are represented. vi.The aggregated CDP are then submitted to County Steering committee (CSC) co-chaired by the County Secretary and County Commissioner, whose other members are County Executive Committee member for finance and economic Planning, Area Member of Parliament, UNHCR, County Focal Person and County Project Manager as Secretary. vii.The felt community needs/wish list are compiled to form the village CDPs. viii.Then each village elects a man and a woman to form members of a ward level committee whose role is to aggregate village CDPs into consolidated Ward CDP ix.The CSC reviews and approves the CDP. x. The approved CDP is forwarded to National Project Implementation Unit and World Bank for review and concurrence. xi. In total 135 villages, 29 Ward, 5 Sub county and 3 County CDPs were prepared and approved at each l2vel. xii.The approved CDP are returned back to village communities for them to initiate the process of preparing Annual Work plans and Budget. xiii. The annual work plans and budgets are drawn from the approved CDPs. xiv. The preparation of Annual work plans and Budget follow the same steps of development and approval of the CDPs. xv. Preparation at Village Level, Aggregation at Ward and Sub county levels and eventually appraisal and approval at County level. xvi. The annual work-plans and budgets are finally consolidated at the sub county level and then are submitted for:- xvii,Appraisal by the County Technical Committee (CTC) comprising of technical County directors. xviii.Approval by the County Steering Committee (CSC) Co-chaired by the County Commissioner and the County Secretary. xix.The approved consolidated CDPs and Annual Work Plans and budget from each group is consolidated and presented as the final work plan. xxiii KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 6. Statement of Project Management responsibilities The Principal Secretary for the Ministry of East African Community (EAC), The ASALs and Regional Development, State Department for ASALs and Regional Development and the Project Manager for KDRDIP 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 (period) ended on June 30, 2023. 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 (v) Making accounting estimates that are reasonable in the circumstances. The Principal Secretary for the Ministry of East African Community (EAC), The ASALs and Regional Development, State Department for ASALs and Regional Development and the Project Manager for KDRDIP 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 Principal Secretary for the State Department of ASALs and the Project Manager for KDRDIP 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, June 2023, and of the Project's financial position as at that date. The Principal Secretary, State Department for ASALs and Regional Development and the Project Manager for KDRDIP 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. xxiv KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 The Principal Secretary for the State Department for ASALs and Regional Development. And the Project Manager for KDRDIP 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 Principal Secretary for the State Department for the Develo ment of the ASALs and the Project Manager for KDRDIP project on 1. It 2023 and signed by; Name Name C) M6OARA NameS*,eA4 M*U;f Principal Secretary Project Manager Project Accountant ICPAK Member No: xxI REPUBLIC OF KENYA Telephone: +254-(20) 321o400 ADQUAR E-mail: info@oagkenya.go.ke Anniversary Towers Website: www.oagkenya.go.ke Montovia Street OFFICE OF THE AUDITOR-GENERAL P.0- Box 30084-o0oo Enhamng AcounMityNAIROBI REPORT OF THE AUDITOR-GENERAL ON KENYA DEVELOPMENT RESPONSE TO DISPLACEMENT IMPACTS PROJECT (KDRDIP) IDA CREDIT NO.60214CE AND GRANT NO. TFOA 7762-KE FOR THE YEAR ENDED 30 JUNE, 2023 - MINISTRY OF EAST AFRICAN COMMUNITY (EAC), ASALS AND REGIONAL DEVELOPMENT PREAMBLE I draw your attention to the contents of my report which is in three parts: A. Report on the Financial Statements which considers whether the financial statements are fairly presented in accordance with the applicable financial reporting framework, accounting standards and the relevant laws and regulations which have a direct efiet on the financial statements. B. Report on Lawfulness and Effectiveness in Use of Public Resources which considers compliance with applicable laws, regulations, policies, gazette notices, circulars, guidelines and manuals and whether public resources are applied in a prudent, efficient, economic, transparent and accountable manner, to ensure government achieves value for money and that such funds are applied for the intended purpose C. Report on Effectiveness of Internal Controls, Risk Management and Governance which considers how the entity has instituted checks and balances to guide internal operations. This responds to the effectiveness of the governance structure, the risi management environment and the internal controls, developed and implemented by those charged with governance for orderly, efficient and effective operations of the entity. An unmodified opinion does not necessarily mean that an entity has complied with all relevant laws and regulations, and that its internal controls, risk management and governance systems are properly designed and were working effectively in the financial year under review- The three parts of the report are aimed at addressing the statutory roles and responsibilities of the Auditor-General as provided by Article 229 of the Constitution, the Public Finance Management Act, 2012 and the Public Audit Act, 2015. The three parts of the report, when read together constitute the report of the Auditor-General. REPORT ON THE FINANCIAL STATEMENTS Opinion I have audited the accompanying financial statements of Kenya Development Response to Displacement Impacts Project (IDA Credit No.6021 -KE) set out on pages 1 to 20, which Report of the Auditor-General on Kenya Development Response to Displacement impacts Project (KDRDIP) IDA Credit No.6021-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 - Ainistrv of EastAfrican Community (E4C), ASALS and Regional Development comprise of the statement of financial assets as at 30 June, 2023, and the statement of receipts and paymerits, statement of cash flows and statement of comparison of budget and actual amounts for the year then ended, and a summary of significant accounting policies and other explanatiory information in accordance with the provisions of Article 229 of the Constitution of Kenya, 2010 and Section 35 of the Public Audit Act, 2015. 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. In my opinion, the financial statements present fairly, in all material respects, the financial position of Kenya Development Response to Displacement Impacts Project as at 30 June, 2023, 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 complies with the Public Finance Management Act, 2012 and the Financing Agreement Credit No.6021-KE between the International Development Association (IDA) and the Republic of Kenya dated 29 May, 2017. In addition, the special account statement presents fairly the special account transactions and the closing balance has been reconciled with the books of account. Basis for Opinion The audit was conducted in accordance with International Standards of Supreme Audit Institutions (ISSAls). I am independent of the Kenya Development Response to Displacement Impacts Project Management in accordance with ISSAI 130 on Code of Ethics. I have fulfilled other ethical responsibilities in accordance with the ISSAI and in accordance with other ethical requirements applicable to performing audits of financial statements in Kenya. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key Audit Matters Key audit matters are those matters which, in my professional judgment, are of most significance in the audit of the financial statements. There were no key audit matters to report in the year under review. Other Matter 1. Budgetary Control and Performance The statement of comparative budget and actual amounts reflects final receipts budget and actual on a comparable basis of Kshs.4,506,017,975 and Kshs.2,761,611,609 respectively resulting to an underfunding of Kshs.1,744,406,366 or 39% of the budget. Similarly, the Project expended Kshs.3,831,485,393 against an approved budget of Kshs.4,506,017,975 resulting to an under-expenditure of Kshs.674,532,582 or 15% of the budget. Further, there were inaccuracies in the column for actual receipts. The underfunding and under-performance affected the planned activities and may have impacted negatively on service delivery to the public. Report of the Auditor-General on Kenya Developmeni Response to Displacement Impacts Project (KDRDIP) IDA Credit No.6021-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 - Ministry of East African Community (EAC), ASALS and Regional Development 2 2. Unresolved Prior Year Audit Matters In the audit report of the previous year, several issues were raised under Report on Financial Statements, other matter and Report on Effectiveness of Internal Controls, Risk Management and Governance. However, the issue remains unresolved, as relevant Parliamentary committee had not discussed it. REPORT ON LAWFULNESS AND EFFECTIVENESS IN USE OF PUBLIC RESOURCES Conclusion As required by Article 229(6) of the Constitution, based on the audit procedures performed, I confirm that, nothing has come to my attention to cause me to believe that public resources have not been applied lawfully and in an effective way. Basis for Conclusion The audit was conducted in accordance with ISSAI 4000. The standard requires that I comply with ethical requirements and plan and perform the audit to obtain assurance about whether the activities, financial transactions and information reflected in the financial statements are in compliance, in all material respects, with the authorities which govern them. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my conclusion. REPORT ON EFFECTIVENESS OF INTERNAL CONTROLS, RISK MANAGEMENT AND GOVERNANCE Conclusion As required by Section 7(1)(a) of the Public Audit Act, 2015, based on the audit procedures performed, I confirm that, nothing has come to my attention to cause me to believe that internal controls, risk management and governance were not effective. Basis for Conclusion The audit was conducted in accordance with ISSAI 2315 and ISSAI 2330. The standards require that I plan and perform the audit to obtain assurance about whether effective processes and systems of internal control, risk management and overall governance were operating effectively, in all material respects. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my conclusion. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENT As required by International Development Agency credit Agreement No.6021-KE dated 29 May, 2017, I report based on my audit, that: i. 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; Report of the Auditor-General on Kenya Development Response to Displacement Impacts Project (KDRDIP) IDA Credit No. 602 1-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 - Ministry of East African Community (EAC), ASALS and Regional Development 3 ii. In my opinion, adequate accounting records have been kept by the Project, so far as appears from the examination of those recordt; and iii. The Project's financial statements agree with the accounting records and returns. Responsibilities of Management and those Charged with Governance Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards (Cash Basis) and for maintaining effective internal controls as Management determines is necessary to enable the preparation of financial statements which are free from material misstatement, whether due to fraud or error and for its assessment of the effectiveness of internal controls, risk management and overall governance. In preparing the financial statements, Management is responsible for assessing the Project's ability to continue to sustain its services, disclosing, as applicable, matters related to sustainability of its services and using the applicable basis of accounting unless Management is aware of the intention to terminate the Project or cease operations. Management is also responsible for the submission of the financial statements to the Auditor-General in accordance with the provisions of Section 47 of the Public Audit Act, 2015. In addition to the responsibility for the preparation and presentation of the financial statements described above, Management is also responsible for ensuring that the activities, financial transactions and information reflected in the financial statements are in compliance with the authorities which govern them, and that public resources are applied in an effective way. Those charged with governance are responsible for overseeing the Project's financial reporting process, reviewing the effectiveness of how Management monitors compliance with relevant legislative and regulatory requirements, ensuring that effective processes and systems are in place to address key roles and responsibilities in relation to governance and risk management, and ensuring the adequacy and effectiveness of the control environment. Auditor-General's Responsibilities for the Audit The audit objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report which includes my opinion in accordance with the provisions of Section 48 of the Public Audit Act, 2015 and submit the audit report in compliance with Article 229(7) of the Constitution. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISSAls will always detect a material misstatement and weakness when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Report of the Auditor-General on Kenya Development Response to Displacement Impacts Project (KDRDIP) IDA Credit No. 6021-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 - Ministry of East African Community (EAQ, ASALS and Regional Development 4 In addition to the audit of the financial statements, a compliance audit is planned and performed to express a conclusion about whether, in all material respects, the activities, financial transactions and information reflected in the financial statements are in compliance with the authorities which govern them in accordance with the provisions of Article 229(6) of the Constitution and submit the audit report in compliance with Article 229(7) of the Constitution. Further, in planning and performing the audit of the financial statements and audit of compliance, I consider internal controls in order to give an assurance on the effectiveness of internal controls, risk management and governance processes and systems in accordance with the provisions of Section 7(1)(a) of the Public Audit Act, 2015 and submit the audit report in compliance with Article 229(7) of the Constitution. My consideration of the internal control would not necessarily disclose all matters in the internal control which might be material weaknesses under the ISSAls. A material weakness is a condition in which, the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatement caused by error or fraud in amounts that would be material in relation to the financial statements being audited, may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Because of its inherent limitations, internal controls may not prevent or detect misstatements and instances of non-compliance. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate. As part of an audit conducted in accordance with ISSAls, I exercise professional judgement and maintain professional skepticism throughout the audit. I also; * Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management. * Conclude on the appropriateness of the Management's use of the applicable basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions which may cast significant doubt on the Project's ability to continue to sustain its services. If I conclude that a material uncertainty exists, I am required to draw attention in the auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my audit report. However, future events or conditions may cause the Project to cease to continue to sustain its services. Report of the Auditor-General on Kenya Development Response to Displacement Impacts Project (KDRDIP) IDA Credit No. 602 1-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 - Ministry of East African Community (EAC), ASALS and Regional Development 5 * Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner which achieves fair presentation. * Obtain sufficient appropriate audit evidence regarding the financial information and business activities of the Project to express an opinion on the financial statements. * Perform such other procedures as I consider necessary in the circumstances. I communicate with the Management regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls which are identified during the audit. I also provide Management with a statement that I have complied with relevant ethical requirements regarding independence and to communicate with them all relationships and other matters which may reasonably be thought to bear on my independence and where applicable, related safeguards. CPA BS AUDITOR-GENERAL Nairobi 28 November, 2023 Report of the Auditor-General on Kenya Development Response to Displacement Impacts Project (KDRDIP) IDA Credit No.6021-KE and Grant No. TFOA 7762-KE for the year ended 30 June, 2023 - Ministry of East African Community (EAC, ASALS and Regional Development 6 KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 8. Statement of Receipts and Payments for the year ended 30th June 2023 STATEMENT OF RECEIPTS AND PAYMENTS Note FY 2022/23 FY 2021/22 FY 2021/22 Cumulative to (Restated) Date Receipts and Receipts Receipts and Receipts and payments and payments payments controlled by Payments controlled by controlled by the entity made by the entity the entity third parties Kshs Kshs Kshs Ksbs Kshs RECEIPTS Proceeds from I - - 142,927,810 142,927,810 854,654,576 Domestic and Foreign Grants Loan from External 2 2,761,611,609 - 3,403,403,059 3,403,403,059 10,140,539,439 Development Partners Cash and Cash 6 - - - 145,125,454 Equivalents B/F Prior Year 6 - - - 1,357,901,780 Adjustments TOTAL 2,761,611,609 - 3,546,330,869 5,049,358,103 10,995,194,015 REVENUES PAYMENTS Compensation of 3 612,008,269 - 620,893,048 620.893,048 1,600,524,296 Employees Purchase of goods 4 1,703,921,381 - 1,795,961,678 1,795,961,678 6,109,311,956 and services Acquisition of Non- 5 1,515,555,743 - 1,107,485,402 1,107,485,402 4,188,115,352 financial Assets TOTAL 3,831,485,393 - 3,524,340,128 3,524,340,128 11,897,951,604 PAYMENTS SURPLUS/DEFICIT (1,069,873,784) - 21,990,741 1,525,017,975 (902,757,589) The accounting policies and explanatory notes to these financial statements are an integral part of the financial statements. Name Name i C \j,Narne1;f1- M Principal Secretary Project Manager Project Accountant ICPAK Member No: 1 KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 Receipts and payment bar graphs consecutively Final Budge Actual on RECEIPTS Budget Comparable Basis REVENUE UTILISATION BAR GRAPH Proceeds from 4 0000 L ,11,083 Domestic 3500 000 C and Foreign 2,761.611.609 Grants 361t,000.0002 Balance B/D 1Soc 0 Fon frm 64,406,892 36l,00 00000 6440af0r2 External ill 0,9 Developmentra ac Partne rs 4090 611 083 2.761,611,609 Ttal Receipts 14_6,017,W75 2,761,611,609 Final Actual on Budget Comparable UTLISATION BAR GRAPH PAYMENTS Basis Compensation of employees 623,354,798 Use of goods and services 2,145,678,125 1,703,921,381 38 505 Transfers to 5 Other Government ts 23)54.'9, 612 008,269 Other Grants V and Other LPayments Social Security Benefits Acquisition of Non-financial Assets 1,736,985,052 1,515,555,743 Total Payments 4,506,017,975 3,831,485,393 KDRDIP Project Annual Report and Financial Statementsfor the financial year ended June 30, 2023 9. Statement of Financial Assets as at 30th June 2023 STATEMENT OF FINANCIAL ASSETS FY 2021/22 FY021/22 Note FY 2022/23 (Restated) Kshs Kshs Kshs Bank Balancen 6 455,144,191 64,406,892 1,525,017,975 Total Cash and Cash equivalents 455,144,191 64,406,892 1,525,017,975 TOTAL FINANCIAL ASSETS 455,144,191 64,406,892 1,525,017,975 Fund balance b/fwd. 8 64406,892 145,125,454 - - 1,525,017,975 Surplus /(deficit) for thc year (1069873784) 21,990,741 Prior Year Ad ustment 9 1,460,611,083 (102,509,304) NET FINANCIAL POSITION T _ 455,144,191 64,406,892 1,525,017,975 The accounting policies and explanatory notes to these financial statements fon integral part of the financial statements. The financial statements were approved on it. I 2023 and signed by: ............ Name Name\A ( OMW Name SAP-A..+ Principal Secretary Project Manager Project Accountant ICPAK Member No: KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 to. Statement of Cash flow for the year ended 30th June 2023 STATEMENT OF CASH FLOW FY2021/22 FY2021/22 Note FY 2022/23 (Re-stated) Ksks Kshs Kshs CASH FLOW FROM OPERATING ACTIVITIES Receipts for operating income Proceeds from Domestic and Foreign Grants 1 - 142,927,810 142,927,810 142,927,810 Payments for operating exenses Compensation of Employees 3 (612,008,269) (620,893,048) (620,893,048) Use of goods and services 4 (1,703,921,381) (1,795,961,678) (1,795,961,678) (2,315,929,650) (2,416,854,726) (2,416,854,726) Adjusted for: Change in imprests & Advances - - Adjustments during the year/ Reinstatement 9 1,460,611,083.00 (102,509,304) 1,357,901,780 Net cash flow from operating activities (855,318,567) (2,376,436,220) (916,025,136) CASHFLOW FROM INVESTING ACTIVITIES Acquisition of Non-financial Assets 5 (1,515,555,743) (1,107,485,402) (1.107,485,402) Net cash flows from Investing Activities (1,515,555,743) (1,107,485,402) (3,403,403,059) CASHFLOW FROM BORROWING ACTIVITIES Loan from External Development Partners 2 2,761,611.609 3,403,403,059 3,403,403,059 Net cash flow from financing activities 2,761,611,609 3,403,403,059 3,403,403,059 NET INCREASE IN CASH AND CASH 1,379,892,521 Equivalent 390,737,299 (80,518,562) Cash and Cash Equivalent at Beginning of the 145,125,454 year 6 64,406,892 145,125,454 _ Cash and Cash Equivalent at End of the year 6 455,144,191 64,406,892 1,525,017,975 The accounting policies and explanatory notes to these financial statements form a itgral part of the financial statements. The entity financial statements were approved on ( 2023 and signed by: Name NameV4 OM Name_SA "erH Principal Secretary Project Manager Project Accountant ICPAK Member No: 4 KDRDIP Project Annual Report and Financial Statements for the financial year ended June 30, 2023 i LStatement of Comparison of Budget and Actual amounts for year ended 30th June 2023 n eOriginal Aaua b Utilization % of Budget Basis variance Utilization a b c-ab d e-c-d f--d.c% RECEIPTS/PAYMENTS ITEM RECEIPTS Balance BD 64,406,892 64,406,892 - Proceeds from Domestic and Foreds Grants a 361,000,000 361,000,000 - 361,000.000 0% Loan from External Deresopment 2,620,000,000 1.460,011.083 4.080,611.083 2,761,611.609 1.318.999.474 68, Partners TOTAL RECEIPTS 2,620,000,000 1,886,017,975 4,506,017,975 2,761,611,609 1,744,406,366 61% PAYMENTS Compensation of employees 325,650000 297,704,798 623,354,798 612008.26 11,346,529 98% Use of goods and services 1,504,350.000 641.328.125 2.145,678,125 1,703921.381 441 ,756,744 79% Acquisition ofsNonsfenancial 790,00000 946,985052 1,736,985,052 IL515.555.743 221,429,309 87% Assets TOTAL PAYMENTS 2,620,000,000 1,886,017.975 4,506,017,975 3,831,485,393 674,532,582 85% SURPLUS/DEFICIT (1069,873,784) Note: The significant budget utilization/performance differences in the last column are explained in Annex 2 to these inancial statements. 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