WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. D6280-SB, TF0B8365, E0250, CREDIT NO.6633-SB FINANCIAL REPORTS FOR THE PERIOD FROM IST JANUARY 2022 TO 31ST DECEMBER 2022 TABLE OF CONTENTS Page Report of the Executing Agency 1 Auditor's report 2-4 Statement of Cash Receipts and Payments 5 Notes to and forming part of the Statement of Cash Receipts and Payments 6 - 8 Statement of Comparison of Budgets and Actuals 9 Reconciliation between funds disbursed by the World Bank and funds received by Covid 19 Emergency Response Project 10 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. D6280-SB, TF0B8365, E0250, CREDIT NO.6633-SB FINANCIAL REPORTS FOR THE PERIOD FROM 1ST JANUARY 2022 TO 31ST DECEMBER 2022 Report of the Executing Agency Under the terms of my contract, I have the mandate from the World Bank and the Ministry of Finance as Executing Agency, to supervise and manage the funds provided for the Covid 19 Emergency Response Project funded by the World Bank. I certify that the attached Statement of Cash Receipts and Payments which has been prepared under my supervision presents a true and fair view of the cash receipts and payments of the Covid 19 Emergency Response Project for the year ended 31st December 2022. Dated at Honiara this 28th day of February 2024 Pauline McNeil Permanent Secretary Ministry of Health and Medical Services Executing Agency Representative Covid 19 Emergency Response Project Solomn Isinds Office of the Auditor-General Independent Auditor's Report to the COVID 19 Emergency Response Project Report on the Audit of the Financial Statements Qualified Opinion I have audited the accompanying financial statements of the COVID 19 Emergency Response Project for IDA Grant D6280-SB and IDA Credit 6633-SB ("the Project") which comprise the Statement of Cash Receipts and Payments and Statement of Comparison of Budgets and Actuals for the year ended 31 December 2022, and notes to the financial statements, including a summary of significant accounting policies. The accompanying financial statements have been prepared in accordance with the Financing Agreement (the Agreement) dated 27 January 2021, and E0250 and TFOB8365 dated 23rd May 2022 between the Solomon Islands Government (the Recipient) and the International Development Association (World Bank). In my opinion: * the accompanying financial statements, in all material respects give a true and fair view of the Project's receipts and payments for the year ended 31 December 2022, in accordance with International Public Sector Accounting Standard (IPSAS) Cash Basis; and * except for matters noted in Basis of qualified opinion, payments made by the Project have, in all material respects, been used in accordance with the conditions of the Agreement, and only for the purposes for which they were provided and adequate documentation exists to support the payments incurred as detailed in the Statement of Cash Receipts and Payments. Basis of qualified opinion The Project did not comply with the requirements of the Procurement & Contract Administration Manual, Regulations and Financial Circulars with respect to its procurement processes as required by the Agreement and the Project Operations Manual. As a result, some payments have been approved which did not follow Solomon Islands Government procurement expectations. I conducted my audit in accordance with International Standards of Supreme Audit Institutions (ISSAI). My responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Project in accordance with International Organization of Supreme Audit Institutions (INTOSAI) Code of Ethics, and the ethical requirements that are relevant to my audit of the financial statements and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. 2 Emphasis of Matter - Basis of Accounting and Restriction on Use I draw attention to Note 1 to the financial statements, which describes the basis of accounting. The financial statements are prepared to assist the Project to meet the requirements of the World Bank. As such, the financial statements may not be suitable for another purpose. Our opinion is not modified in respect of this matter. Other information Management is responsible for the other information. The other information comprises the information included in the Executing Agency's report, but does not include the financial statements and my auditors' report thereon. My opinion on the financial statements does not cover the other information and I do not express any form of assurance conclusion thereon. In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard. Responsibilities of Management and Those Charged with Governance for the Financial Statement Management are responsible for the preparation and fair presentation of the financial statements in accordance with IPSAS Cash Basis, the requirements of the World Bank and the Grant Agreements D6280-SB and 6633-SB dated 27th January 2021, and E0250 and TFOB8365 dated 23rd May 2022 between the Recipient and World Bank 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. Those charged with governance are responsible for overseeing the Project's financial reporting process. Auditor's Responsibilities for the Audit of the Financial Statements My objective is 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 auditors' report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standards of Supreme Audit Institutions (ISSAls) will always detect a material misstatement 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. As part of an audit in accordance with ISSAls, I exercise professional judgment 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. 3 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. * Obtain an understanding of internal control relevant to the audit 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. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identified during my audit. Report on Other Legal and regulatory requirements I have obtained all the information and explanations which, to the best of my knowledge and belief, are necessary for the purposes of my audit. In my opinion, except for the matter described in the Basis for Qualified Opinion section of my report: i) proper books of account have been kept by the Project, sufficient to enable financial statements to be prepared, so far as it appears from my examination of those books; ii) to the best of my knowledge and according to the information and explanations given to us, the financial statements have been prepared in accordance with the requirements of the Agreement; and lii) the Project did not comply with the requirements of the Agreement and the Project Operations Manual which require the audited financial statements to be submitted to the World Bank no later than six months after the year end to which the financial statements relate. The signed statements were presented to me on 28 February 2024. Day Teika Dennis Office of the Auditor-General Honiara, Solomon Islands 29 Fe ruBy 224 4 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. D6280-SB, TFOB8365, E0250, CREDIT NO.6633-SB STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR THE PERIOD FROM 1ST JANUARY 2022 TO 31ST DECEMBER 2022 Notes Receipts / Receipts I Payments 2022 Payments 2021 $ $ RECEIPTS External Assistance - Multilateral Agencies World Bank - Grant and Credit received: Proceeds from IDA Funds (D6280-SB) 3 7,251,086 5,000,000 Proceeds from IDA Funds (6633-SB) 3 3,789,973 3,200,000 Proceeds from Trust Funds (TOFB8365) 3 3,000,000 - Proceeds from IDA Funds (E0250) 3 5,869,314 - 19,910,373 8,200,000 Other Receipts Bank Interest 933 1,866 TOTAL RECEIPTS 19,911,306 8,201,866 PAYMENTS Preparedness and Response Consumables - laboratory PPE 4 361,258 745,334 Contractual workers 4 4,934,180 368,319 Operational expenses 4 7,433,495 1,020,359 Vaccine deployment support 4 3,987,607 - 16,716,540 2,134,012 Health System Strengthening Equipment - incinerator 5 424,812 - Health care waste management support 5 10,500 2,382,519 Provincial hospital renovation 5 117,018 - Refurbishments 5 1,737,100 354,945 Strengthening HR systems and policy 5 176,083 - Training 5 321,031 - 2,786,544 2,737,464 Project Implementation Management Project management expense 6 1,568,877 726,964 Monitoring and evaluation 6 150,947 - 1,719,824 726,964 TOTAL PAYMENTS 21,222,908 5,598,440 Increasel(Decrease) In Cash (1,311,602) 2,603,426 Cash at beginning of period 2,603,426 - Cash at end of period 2 1,291,824 2,603,426 The statement is to be read in conjunction with Notes to and forming part of the Statements of Cash Receipts and Payments on page 6 to 8. 5 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. D6280-SB, TFOBS365, E0260, CREDIT NO.8633-SB NOTES TO AND FORMING PART OF THE STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR THE PERIOD FROM 1ST JANUARY 2022 TO 31ST DECEMBER 2022 1 STATEMENT OF ACCOUNTING POLICIES a Basis of Preparation The Statement of Cash Receipts and Payments has been prepared in accordance with International Public Sector Accounting Standards Financial Reporting under the Cash Basis of Accounting (Cash Basis IPSAS), The accounting policies have been applied consistently throughoul the period b Reporting entity The Statement of Cash Receipts and Payments is for the Covid 19 Emergency Response Project as supervised by the Ministry of Finance in Solomon Islands. The program commenced on 27 January 2021 with the signing of the financing agreement with the World Bank Additional financing agreements IDA E0250 and trust fund TFOB8365 were signed on 23rd May 2022. This Statement covers the period from 1 January 2022 10 31 December 2022. In accordance with the grant agreement, all of the funds are to come from the World Bank. c Reporting currency The accounts are stated in Solomon Dollars (S8D) as this is the currency used for the grants and credit and all project reports. Foreign currency equivalents are converted at the rate applicable on the date of transaction. However, budget figures are converted at the rate of I USD = 8 09 SBD which is the average exchange rate for all funds received in the financial period 2022. Undisbursed amounts denominated in foreign currencies are converted into Solomon Dollars (SBD) at the rate of 1 USD = 8.18 SBD which is the exchange rate at the financial period end 31st December 2022. d Fixed assets Capital expenditure is expensed during the year in which the expendilure Is made. e Budget Budget information for the grant funding is set out on page 9. 2 CASH Cash is comprised of cash balances . 2022 2021 $ $ Cash at bank iBSP Ac no 2001325188) 1,291.824 2,603,426 1,291,624 2,603,426 3 EXTERNAL ASSISTANCE - UNDRAWN As of 31st December 2022, the following amounts are undrawn. TOTAL FUNDS DISBURSED UNDISBURSED XDR XDR SBD XDR SBD To-Date 2022 To-Date GRANT -IDA (D6280-SB) FUNDS XDR 1,800,000.00 XDR 1,107,442.40 $7,251,086 $12.251,086 XDR 692.557.60 7,539,369.86 CREDIT-IDA (6633 -SB) FUNDS XDR 1,800,000.00 XDR 628,12085 $3.789973 $6,989,973 XDR 1.171,87915 12,757.394.24 IDA - E0250 XDR 3.700.000.00 XDR 563,534.57 $6,869,314 $5,869,314 XDR 3,136,465.43 34,144,413.28 TRUST FUND -TFOB8365 USD3,000,000.00 USD 373,599 $3,000,000 $3,000,000 USD 373,599 3,056,039.82 TOTAL i 19,910,373 28,110,373 57,497,217.20 Exchange rate - 1 USD = 8 18 SBD 1 XDR = 1,33084000 USD The above undrawn amounts are to fund the project up to 31st of December 2024. The funds can be disbursed to the projects designated accounts by submission of withdrawal applications by the project and approval by the World Bank Each fund has its own ceiling and the projects designated accounts currently has a ceiling of $5 000.000 SBD for Grant and $3,200,030 for Credit $5,000,000 for IDA and $3,200,000 for Trust Funds under Covid 19 Emergency Project All funds are pooled into the project's designated account The credit tDA 6633-SB is repayable commencing from 15 January 2031 to 15 July 2040 at the rate of 1% and commencing 15 January 2041 to 15 July 2080 at the rate of 2%. 6 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. D6280-SB, TFOBB36, E0260, CREDIT NO.6633-SB NOTES TO AND FORMING PARTOF THE STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR THE PERIOD FROM IST JANUARY 2022 TO31STDECEMBER 2022 2022 2021 $ $ 4 Component I PPE's Laboratory Consumables Laboratory test kits - GeneXperts and QPR machine 66,550 598,392 Laboratory consumables - COVI;D 19 tests 294708 146942 361,258 745,334 Contractual Workers Laboratory technicians 624,070 69,449 Communications specialists 404.036 149435 Technical advisor 402,203 149,435 International consultant 3.503,871 4.934.180 368,319 Operational Expense for the Response Effort Including GBV Accommodation 1,385,340 - Electricity 1.032,323 Equipment 1,632,194 Food expense 119.411 50.008 Motor vehicle expenses 258,906 30,650 Office supplies and general expense 37,439 12.170 Printing and photocopy 826,821 771,800 Professional services - land clearance 393,501 Security 120q000 - Training 105,000 - Travelting and transport hire 1,522,560 155,531 7,433,495 1,020,359 Support to COVID 19 Vaccines Deployment Human resources costs 1,162,490 - Transport 1,124,872 Demand generation and communication - Outreach and Printng 1.700,245 3,987,607 5 Component 2 Provincial Hospital Renovation Renovation 117,016 117018 Incinerators Equipment - Incenerators 424,812 424,812 - Health Care Waste Management Support Motor veh[cles expenses 10,500 2.382519 10,500 2,382,519 Refurbishment cost Refurbish of National Health Emergency Centre (NHEOC) - 354,945 Refurbishment of National Medical Stores 1,737,100 1,737,100 354,945 Training (IPC,GBV, Waste Management, Surveillance, Warehouse Training - GBV 167,526 Training - Surveillance and IPC 153,505 321.031 Strengthening HR Systems and Policy RDP Implementation Support Services and HR Systems 176,083 176,083 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. D6280-SB, TFOBS366, ED250, CREDIT NO.6633-SB NOTES TO AND FORMING PART OF THE STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR THE PERIOD FROM 1ST JANUARY 2022 TO 31ST DECEMBER 2022 2022 2021 6 Component 3 Project Management Project manager 231,428 89,887 Procurement officer 190,973 60,137 Financial management officer 185.973 68.585 Monitoring and evaluation officer 181.413 37.210 Environment, social and health safety & community engagement officer 183,973 68,585 Environment, social and health safety & community engagement specialist 41,631 - Office setup and mobilization cost 322,724 402,560 Infrastructure officer 230,762 - 1.568.877 726,964 Monitoring and Evaluation Travelling and project visit 141,047 Workshop and meeting 9,900 150,947 7 EXTERNAL ASSISTANCE - PAYMENTS BY THIRD PARTIES There were no payments by third parties 8 RESTRICTIONS ON CASH BALANCES AND ACCESS TO BORROWINGS The amounts presented in the budgets are all under the control of the World Bank. World Bank Covid 19 Emergency Project only controls the amounts paid to its designated accounts. 8 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs D6280-SB, TFOB365, E0250, CREDIT NO.6633-SB STATEIVENT OF COMPARISION OF BUDGETS AND ACTUALS FOR THE PERIOD FROM 1ST JANUARY 2022 TO 31 ST DECEMBER 2022 Final Budget Actual Variance SBD SBD SBD Amount % CASH INFLOWS (i) Proceeds from Credit IDA Funds (6633-SB) 9,835,418 7,251,086 2,584,332 26% (ii) Proceeds from IDA Funds (D6280-SB) 1,834,470 3,789,973 (1,955,503) -107% (iii) Proceeds from Trust Funds (TFB 8365) 1,452,097 30,000 (1,547,903) -107% (iv) Proceeds fron IDA Funds (E0250) 2,840,939 5,869,314 (3,028,375) -107% (v) Other receipts- Bank Interest - 933 (933) -100% TOTAL RECElPTS 15,962,924 19,911,306 (3,948,382) -25% CASH OUTFLOWS Component 1: Emergency Covid 19 Preparedness and Response PPE's Laboratory Consumables - 361,258 (361,258) -100% Contractual Workers 667,883 4,934,180 {4,266,297) 639% Operational Expense for the Response Effort Including GBV 728,100 7,433,495 (6,705,395) -921% Support to COVID 19 Vaccines Deployment - 3,987,607 (3,987367) -100% SUB TOTAL 1,395,983 16,716,640 15,320,357 1097% Component 2: Health System Strengtening Renovation of 2 Provincial Hospitals 7,885,500 117,018 7,568,482 98% Incenerators I- 424,812 (424,812) -100% Health Care Waste Management Support - 10,500 (10,500) -100% Refurbish of National Health Emergency Centre (NHEOC) 1,618,000 - 1,618,000 100% Refurbishment of National Medical Stores 2,427,000 1,737,100 689,900 28% Training (IPC,GBV, Waste Management, Surveillance, Warehouse 1,383,390 321,031 1,062,359 77% Strengthening HR Systems and Policy _,- 176,083 (176,083) -100% SUB TOTAL 13,113,890 2,786,544 (10,327,346)1 -79% Component 3: Project Implementation Management Project manager 210,753 231,428 (20,675) -10% Procurement officer 175,067 190,973 (15,906) -9% Financial management officer 175,067 185,973 (10,906) -6% Monitoring and evaluation officer 175,067 181,413 (6,346) -4% Deployment of Envitoment, Social and Health and Safety and Community 183,973 (8,906) -5% Engaqement (ESHS & CE) Officer (Full Time) 175,067 Deployment of International Enviromental, Social and Health and Safety 39,269 49% and Community Engagement (ESHS & CE) Specialist (Part- time) 80,900 41,631 Deployment of GBV Specialist (as Needed basis) 16,180 16,180 100% Payment of Audit Fees 80,900 - 80,900 0% Payment of Compensation- - - 0% Office Setup and Mobilization- 322,724 (322,724) -100% Infrastructure Officer - 230,762 (230,762) -100% Monitoring and Evaluation 364,050 150,947 213,103 59% TOTAL 1,453,051 1,719,824 (266,773) -18% TOTAL PROJECT PAYMENTS 15,962,924 21,222,908 5,259,984 33% NET CASH FLOWS (1,311,602) 1,311,602 - 9 WORLD BANK COVID 19 EMERGENCY RESPONSE PROJECT GRANT NOs. DB280-SB, TFOB8365, E0250, CREDIT NO.6633-SB RECONCILIATION BETWEEN FUNDS DISBURSED BY THE WORLD BANK AND FUNDS RECEIVED BY COVID 19 EMERGENCY RESPONSE PROJECT FOR THE PERIOD FROM 1ST JANUARY 2022 TO 31ST DECEMBER 2022 TYPE OF DISBURSEMENT AMCUNT FUNDS DISBURSED BY THE WORLD BANK FOR 2022: USD SBD W8 Credit - 6633-SR WACO2 DESIGNATED ACCOUNT 168,173,05 1,360,520 WACO3 DESIGNATED ACCOUNT 26,871.45 217,390 WACO4 DESIGNATED ACCOUNT 43,874.54 354,945 WACO5 DESIGNATED ACCOUNT 370.83 3,000 WACO7 DESIGNATED ACCOUNT 14,464.52 117,018 WAC08 DESIGNATED ACCOUNT 214,721.88 1,737,100 WAC10 DESIGNATED ACCOUNT 3,708.28 30,000 We Grant - D6280-SB WAGO3 DESIGNATED ACCOUNT 30,113.97 243,622 WAGO4 DESGNATED ACCOUNT 45,341.78 366,815 WAG05 DESIGNATED ACCOUNT 226,61731 1,833,334 WAGOS DESIGNATED ACCOUNT 132,125.58 1,068,904 WAGO7 DESIGNATED ACCOUNT 319,431.89 2,584,204 WAGO9 DESIGNATED ACCOUNT 107,830.28 872,347 WAG10 DESIGNATED ACCOUNT 34,840.67 281,861 WAG12 DESIGNATED ACCOUNT 69,704.20 563,907 WAG13 DESIGNATED ACCOUNT 24,978.86 202,079 WB IDA - E0250 WAEO2 DESIGNATED ACCOUNT 642,768.85 5,200,000 WAFO3 DESIGNATED ACCOUNT 82,733.50 669,314 WAEO4 DESIGNATED ACCOUNT 180,635.11 1,461,338 WB HEPRTF-B8365 TER0 DESIGNATED ACCOUNT 370,828.18 3,000,000 TFB02 DESIGNATED ACCOUNT 96,463.54 780,390 TFBO3 DESIGNATED ACCOUNT 30,902.35 250,00 TOTAL FUNDS DISBURSED BY THE WORLD BANK IN 2022 2,867,502 23,198,088 LESS FUNDS AT CENTRAL BANK Account No: 20366 - WORLD BANK COVID-19 EMERGENCY RESPONSE PROJECT ACCOUNT WB Credit - 6633-SB WAC10 DESIGNATED ACCOUNT 3,708.28 30,000 WB Grant - Q6280-SB WAG12 DESEGNATED ACCOUNT 69,704.20 563,907 WAG13 DESIGNATED ACCOUNT 24,978.99 202,080 WB IDA - E0250 WAE04 DESIGNATED ACCOUNT 180,635.11 1,461,338 WB HEPRTF - B8365 TFBO2 DESIGNATED ACCOUNT 96,463.54 78D,390 TFRO3 DESIGNATED ACCOUNT 30,902.35 250,000 TOTAL 406,392.46 3,287,715 TOTAL RECEIPTS BY COVJD 19 EMERGENCY RESPONSE PROJECT IN 2022 AS PER FINANCIAL REPORT 2,461,109.15 19,910,373 10