0 STATE AUDIT OFFICE OF VIET NAM AUDIT REPORT RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 TEMPLATE NO. 01/BCKT- CTMT Hanoi, 31 August 2022 Template No. 01/BCKT-CTMT 1 STATE AUDIT OFFICE SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom - Happiness Hanoi, 13 June 2022 REPORT ON RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Under Decision No. 713/QĐ-KTNN dated May 20, 2022 by the Auditor General of the State Audit Office of Viet Nam on auditing the Results-Based National Urban Development Program in the Northern Mountains Region for 2021 (hereinafter referred to the Program), thematic audit of Vietnam Coastal Cities Sustainable Environment Project and Project on Emergency Remediation of Natural Disasters in Some Central Provinces - Ninh Thuan Province, an Audit Delegation of the Specialized Audit Department No. V of the the State Audit Office has conducted the audit of the above-mentioned Program from May 24, 2022 to July 22, 2022. 1. Subject matters The management and use of the Program's budget, investment costs for the project implementation; compliance with the State's policies, regimes annd laws as well as the Financing Agreement; management, direction and coordination in implementing the Program; the fulfillment of the Program's objectives; economy, effectiveness and efficiency of the Program. 2. Audit scope and limitations 2.1. Audit scope - Audited entities list (See the list of Audited entities at Annex No. 01/BCKT-CTMT). - Audit period: from 01/01/2021 to 30/6/2022, previous and subsequent periods concerned. 2.2. Scope limitation - Did not conduct assest and cash inventory; did not collate with suppliers of materials, equipment and services - Did not verify the quality of the installed works, machinery and equipment; did not check the hidden items; - Did not audit the compensation costs for site clearance under the Program (did not collate and verify with the beneficial households, did not witness and verify the compensation volume measurement, did not audit the unit prices in 2 the approved plan), just verify the actual amount paid according to the compensation plan, the site clearance progress and assessment; - Did not audit the expenses for the formation of fixed assets, debts, backlog materials and equipment as the Program has not been finished. - Did not check and evaluate the management and use of works after investment as the International Cooperation Department is in charge of result verification; - Did not audit the investment preparatory stage conducted by the PMU of PPTAF as it was under other project’s scope; did not re-audit the contents/matters of the previous years by the Specialised State Audit Office No. 5. The detailed limitation, the reasons for the limitation of relevant content are specified in the Minutes of confirmation of data and the audit situation, the Auditing Minutes of the Audit Teams. 3. Audit basis - Law on State Audit, Law on State Budget, Law on Public Investment, Law on Accounting, Law on Construction, Law on Bidding, Financing Agreement between the Government of Vietnam and the Donor; other relevant laws and legal documents; - State Audit Standards, Audit procedures, Regulations on Organization and Operation of the State Audit Delegation; the Terms of Reference agreed by the Donor (WB) and the SAV; The audit report is prepared on the basis of audit evidences, Program financial statements (capital sources, investment costs) prepared by the audited entities; audit minutes with the audited entities and other relevant documents. 4. Program overview The Program was approved by the Prime Misister through the Decision No. 189/QĐ-TTg dated 25/01/2014 on the approval of the project lists “Results- Based National Urban Development Program in the Northern Mountains Region”, borrowing the WB’s loans. - Line agencies: Ministry of Construction, People's Committees of provinces: Bac Kan, Cao Bang, Dien Bien, Hoa Binh, Thai Nguyen, Tuyen Quang and Yen Bai. In which, the project coordinating agency is the Ministry of Construction. - Owners: Urban Development Agency under the Ministry of Construction, People's Committees of the cities: Bac Kan, Cao Bang, Dien Bien Phu, Hoa Binh, Thai Nguyen, Tuyen Quang and Yen Bai. 3 - Objectives of the Program: Improve urban infrastructure, sanitation and hygiene conditions as well as people living standards for sustainable socio- economic development in cities and towns in 07 provinces in the Northern mountain region; Strengthen capacity of the central level agencies of planning and developing the national urban development policies and programs; develop strategies to implement the Results-based Program approach across the country; Improve the capacity of urban planning and management for local authorities. - Main contents of the Program: Investment in construction of urban infrastructure in cities and towns in 07 provinces, including new construction, upgrading and renovation of a number of roads, bridges, reservoirs, water drainage system, kindergartens; formulating and implementing national policies on urban development, providing technical support for units managing and operating technical infrastructure systems in localities; verifying results, monitoring and auditing the Program. - Components: Component 1: Investment in constructing infrustructure in urbans participating in the Program (carried out in cities taking part in the Program); Component 2: Support to carry out the Program and formulate National Policies (Component 2 consists of 3 sub-components implemented by the MOC and the SAV), including: 1- Technical supports for ubans; 2- Verify the results and supervise the Program; 3- Formulate and carry out National urban development policies. - Total Project cost: 301.856 million USD including: 280.056 million USD (Component 1) and 21.8 million USD (Component 2). - Capital structure: IDA commitment (Central budget to be allocated; localities to reborrow): 250 million USD, accounting for 82.82%; Counterpart funds of Viet Nam side (capital allocated from the central budget and local budget sources): 51.856 million USD, accounting for 17,18%. - Program implementation period: 06 years from the effective date of the Financing Agreement according to the Decision No. 189/QĐ-TTg and extended by 30/6/2022 under Decision No. 1141/QĐ-CTN dated 29/6/2021 by the President on the extension of the loan closing date of the Credit Number 5476- VN. The due date for total accounts/settlement and closing procedures: 12 months after finishing the activities of Program. PART ONE AUDIT VERIFICATION 4 I. VERIFICATION ON THE TRUTH AND FAIRNESS OF THE PROGRAM FINAL ACCOUNTS REPORT 1. Program audit results: (See further details in Appendices No. 07.1, 07.2, 07.3, 08, 09 và 10/BCKT-CTMT enclosed). 2. Verification of the truth and fairness of the Program financial statement. Responsibilities of the audited entities: To truthfully and fairly prepare and present the final accounts report of the Program implementation financing situation, reports on investment capital and non-business expenses, investment costs for the implementation of the Program from 01/01/2021 to the end of 30/6/2022 and the Program financial statement as of 30/6/2022 in accordance of the applicable framework of making and presenting final accounts report, reports on investment capital and non-business expenses, invesment costs for the Program implementation (Standards, accounting regimes, other relevant legal regulations); conduct internal controls that the entities found necessary to ensure the making and presentation of Program implementation final accounts reports, reports on investment capital and non-business expenses, invesment costs for the Program implementation free of material mistatements due to frauds or errors. Responsibilities of the audit delegation: Provide independent opinions, based on audit results, on the Program implementation final accounts reports, reports on investment capital and non-business expenses, invesment costs for the Program implementation from 01/01/2021 to the end of 30/6/2022 and the Program financial statement as of 30/6/2022 which were prepared by the entities. The audit delegation has conducted this audit in accordance with basis, scope and limitation (stated in the previous part of this audit report), in combination with documents provided by the entities, in compliance with code of ethics, regulations of audit planning and excution, in application of appropriate audit methods, using judgements of auditors to collect audit evidences, to assess material risks and misstatements in the Program imlementation final accounts reports, reports on investment capital and non- business expenses, invesment costs for the Program implementation and the Program financial statement as of 30/6/2022, eventually to identify the most appropriate audit procedures. The audit work also included the assessment of reasonableness of the applied accounting policies and estimates. The collected findings (through analysis, collation, document detail tests, speadsheets, etc.) are sufficient and appropriate, serving as a basis for the audit delegation to form its audit opinions. 5 Audit opinions - Basis: audit basis (stated in the Point 3 of this Audit Report), code of professional ethics, regulations on audit plan and execution, audit methods. Total estimated errors are larger than the overall materiality level (35,949 million VND/5,647 million VND) but not pervasive, mainly the recovery to the state budget an amount of 12,874 million VND, payment reduction of 6,592 million VND, and the return of capital to the program 5,675 million VND and deduct the value when paying the acceptance volume for the next period 9,700 million VND. Total estimated errors are larger than the overall materiality level (35,949 million VND/5,647 million VND) but not pervasive, mainly due to the recovery of state budget of 12,874 million VND, payment reduction of 6,592 million VND, and the return of capital to the program 5,675 million VND and deduct the value when paying the acceptance volume for the next period 9,700 million VND. - In the opinion of the State Audit Delegation, on the basis of records and documents provided by the owners and audit results, in all material aspects, except for the influence of the above-mentioned issues (stated in the scope and scope limitation of this audit report), the Program implementation final accounts reports, reports on investment capital and non-business expenses, invesment costs for the Program implementation and financial statements as of 30/6/2022 fairly reflected the financial settlement, investment capital sources, non-business expenses, investment costs, and are consistent with the applicable regulations of the State and the Donor. The Program implementation final accounts reports, reports on investment capital sources and non-business expenses, invesment costs for the Program implementation and financial statements as of 30/6/2022 are unqualified in line with the contents of this audit report. II. VERIFICATION ON COMPLIANCE WITH LAWS, POLICIES, REGIMES IN PROGRAM MANAGEMENT 1. General assessment - In implementation of the Decision No. 189/QĐ-TTg by the Prime Minister and Decision No. 1141/QĐ-CTN by the President on the extention of the loan closing date of Credit No. 5476-VN, MOC and PPCs have directed the relevant departments, sectors to cooperate and support the People’s Committees of the cities in their management and implementation of the Program such as allocation, balancing and assignment of capital plan, advance; in design and esimate appraisal; in disbursement and settlement to provide the favorable 6 conditions for owers during their implementation. - The owners and related units have basically complied with the provisions of the Construction Law No. 50/2014/QH13 dated 18/6/2014 by the National Assembly; Law on Tendering No. 43/2013/QH13 dated 26/11/2013; Decree No. 15/2021/ND-CP dated 3/3/2021 by the Government regulating some contents on construction investment project management; Decree No. 63/2014/ND-CP dated 26/6/2014 by the Government regulating the implementation of several articles of the Law on Tendering; Decree No. 06/2021/ND-CP dated 26/01/2021 by the Government on the Construction Works Quality Management and Maintenance; Decree No. 50/2021/ND-CP dated 01/04/2021 by the Government amending and supplementing some articles to the Government's Decree No. 37/2015/ND- CP dated 22/4/2015 regulating expenses details on construction contracts and guiding, amending, adjusting and supplementing documents on investment and construction management issued by the State. Financing Agreement, Program Document, Program Operation Manuals and other relevant legal documents. - As of 30/6/2022, program execution progress has been basically completed. The completed works items were handed over to the technical infrastructure system operating management units of the cities; the program helps to expand the urban space, connecting the old urban area with the new one, to narrow the gap between inner city and suburban city, contributing to socio-economic development, environmental improvement with more beautiful urban landscape, generate more economic value and ensure social security. The program basically completed the disbursement indicators DLI and was in compliance with the actions regulated in PAP. - The capital plan of the Program is fully integrated into the annual and medium-term public investment plans in the provinces. 4 as per total 7 provinces arranged counterpart funds meeting the requirements of the Loan Agreement. The signing of the on-lending agreement and arrangement for repayment of principal, interest and fees to the provinces complied with the provisions of the signed Loan Agreement. The program's funds are allocated, managed and used according to the list of projects approved by the World Bank, basically meeting the economy, effectiveness and efficiency of capital use. - The PMUs have disbursed and paid to construction contractors when their documents and procedures were provided in consistence with the provisions of Circular No. 111/2016/TT-BTC dated June 30, 2016 of the Ministry of Finance and Circular No. 349/2016/TT-BTC dated December 30, 2016 of the Ministry of Finance, expenditures were made according to the assigned estimates with the 7 regimes, standards and norms in accordance with the financial regulations of the program. At the end of the year, the PMUs will compare and confirm the debts and recover advance according to the contracted rate; recording revenues and expenditures in 2020 with the amount of 620,482 million VND as per regulations. - The Program Coordination Board and local steering committees have directed functional units to organize monitoring and evaluation of the Program implementation progress against the respective plan; coordinate with the World Bank in organizing the monitoring and evaluation, making a report to evaluate the program implementation to summarize and evaluate the implementation of the Program plan in the locality. 2. Shortcomings 2.1. Implementation of the Program objectives and contents - By the end of the Program, accumulated until 30/6/2022, 7/7 cities participating in the Program have not fully achieved the annual DLI3.2 1increase in revenue. Reasons of this unachievement : partly due to the situation of the Covid 19 epidemic, which has reduced the income sources of cities, which has affected production and business activities, tax and fee revenues of cities, in addition to the exclusion of incomes from land from revenue increase index measurement. - Tuyen Quang City has not yet reached DLI 2 - Local urban infrastructure investments provided under the City's approved Annual Advanced Plan 2. The above responsibility belongs to Tuyen Quang PMU and People's Committees of cities: Yen Bai, Bac Kan, Cao Bang, Tuyen Quang, Dien Bien Phu, Hoa Binh, Thai Nguyen. 2.2. Compliance with financial management and accounting regime - The development of the Program's annual, medium-term and annual public investment implementation plan is not yet consistent with actual situation (Bac Kan)3, not suitable for the on-lending contract (Yen Bai)4. 1 5 cities achieved in 3 years (Bac Kan, Cao Bang, Thai Nguyen, Tuyen Quang, Hoa Binh); Dien Bien Phu achieved 1 year and Yen Bai did not achieve any year. 2 Tuyen Quang: By January 2022, 6/8 investment items have been completed according to the city's approved Advanced Plan. The reason was problems occurred in land clearance. 3 Bac Kan: The approved medium-term public investment plan has no details for the on-lending source; The medium-term public investment capital plan for the period 2016-2020 allocated 30,828 million VND is higher than the actual amount (29,969 million VND) of 859 million VND. 4 Yen Bai: The medium-term public investment plan for the 2021-2025 period allocated IDA loans higher than the revised Annex to the on-lending contract between the Ministry of Finance and the Provincial People's Committee, amounting to 9,870 million VND; The capital plan allocated in 2022 was not consistent with the amended Appendix to the on-lending contract between the Ministry of Finance and the People's 8 - As of 30/6/2022, the Program has not yet recorded revenue and expenditure of 58,701.09 million VND5 (Thai Nguyen, Tuyen Quang, Hoa Binh). The main reason was the exchange of revenues and expenditures recording between the Department of Finance and the State Treasury according to the Circular No. 111/20216/TT-BTC. - Some contractors6 have not made declaration and payment of natural resources tax as prescribed in Article 8, Article 9 of Circular No. 152/2015/TT- BTC dated October 2, 2015 of the Ministry of Finance; and environmental protection fees as prescribed in Articles 2 and 6 of Decree 164/2016/ND-CP dated 24/12/2016 of the Government, amount: 1,107 million VND (Dien Bien Phu); - Some bidding packages, when calculating the payment value, have not yet implemented the VAT reduction policy according to Article 1 of Decree No. 15/2022/ND-CP dated January 28, 2022 of the Government (Thai Nguyen, Bac Kan). This responsibility belongs to the PMU and the People's Committee of the following cities: Bac Kan, Yen Bai, Thai Nguyen, Tuyen Quang, Hoa Binh, and Dien Bien Phu. 2.3. Compliance with Law on State Budget - The preparation, allocation and delivery of the estimates were not closely supportive for the ability to perform actual tasks, so in the year, 6/8 audited entities still had to cancel the estimate with a total budget of 216,558.16 million VND7 (Ministry of Construction, Tuyen Quang, Bac Kan, Cao Bang, Dien Bien Phu, Thai Nguyen). The main reasons were that some PMUs did not measure estimates in line with the progress and construction volume; there was unusually heavy rainy in the beneficial areas; making the estimate without DLIs verification results of the previous year. Committee of Yen Bai province: (1) Foreign loan support from the central budget exceeded 26,834 million VND (2) re-lending loan exceeded 922 million VND. 5 Thai Nguyen: 48,018.94 million VND; Tuyen Quang: 10,474.39 million VND; Hoa Binh: 207.76 million VND; 6 Truong Tho Dien Bien Co., Ltd., Hoang Anh Investment Trading and Services Co., Ltd., Manh Quan Investment and Construction Co., Ltd., Ngan Ha Co., Ltd. Dien Bien Province, HanCorp1. 7 Ministry of Construction: 6,605 million VND; Tuyen Quang 4,372 million VND; Bac Kan 51,261 million VND; Cao Bang: 17,828 million VND; Dien Bien Phu: 226 million VND; Thai Nguyen 136,266.16 million VND. 9 - An amount of unused budget of 11,960 million VND has not yet returned to the state budget 8 (Ministry of Construction, Tuyen Quang City, Dien Bien Phu City). - For IDA capital allocated from the central budget, accumulated from the beginning of the Program to 30/6/2022, the Ministry of Finance has notified the transfer to the Ministry of Construction an amount of 1,852,813.65 USD, equivalent to 41,309 million VND. The general audit at 03 units under the Ministry of Construction has found that they received 36,309 million VND, a difference of 5,000 million VND9. The Project Management Unit reported, according to Official Letter No. 12248/BTC-QLN dated 14/9/2017 of the Ministry of Finance to the State Bank's Transaction Office, requesting to transfer money to Account 120227 - State Treasury Transaction Office (State Budget Bank Account) the amount of 5,000 million VND was used to implement component 3 on formulating and implementing national policies of the Ministry of Construction. However, by the time of audit, the Urban Development Project Management Board, Urban Development Department, and the Ministry of Construction have reportedly not yet received such amount. The above responsibility belongs to the PMUs and the People's Committee of the following cities: Tuyen Quang, Bac Kan, Cao Bang, Dien Bien Phu, Thai Nguyen; Academy of construction and urban management officials; Inspector of the Ministry of Construction; Urban Development Project Management Board, Urban Development Department, Ministry of Construction. 2.4. Compliance with the construction investment management regimes (1) Preparation, appraisal and approval of investment projects, design of construction drawings, cost estimates (for works approved from 01/01/2021 to 30/6/2022) * The making, appraisal and approval of investment projects The fact that the environmental impact assessment report that has not yet been appraised and approved by the Ministry of Natural Resources and Environment when making the pre-feasibility study report was not consistent with the provisions of Point a, Clause 2, Article 23 of the Law on Environmental 8 Ministry of Construction: 2,324 million VND (Urban Development Project Management Board: 417 million VND; Academy of Urban and Construction Managers: 8 million VND; Inspector of the Ministry of Construction: 1,899 million VND); Tuyen Quang: 441 million VND; Dien Bien Phu: 9,195 million VND, the reason is that the households do not have to pay for residential land but follow the plan to deduct the residential land according to the land allocation decision of the City People's Committee; 9 Official Dispatch No. 12248/BTC-QLN dated September 14, 2017 of the Ministry of Finance on the transfer of funds for the second IDA advance in 2017 for the Northern Mountain Urban Program - Ho Chi Minh City. Dien Bien Phu and component 3 - Ministry of Construction. 10 Protection in 2014 (Thai Nguyen). However, the Environmental Impact Assessment Report has been completed and opinions were collected from the affected wards of the project before submitting to the Prime Minister for approval on the construction of intersection between Thong Nhat Street and Viet Bac Street 10 and approved in the Decision No. 113/QD-TTg dated January 23, 2021 by the Prime Minister on adjusting the project investment policy. The above responsibility belongs to the PMU and the People's Committee of Thai Nguyen City. * Surveying, making, designing construction drawings, cost estimates - Bidding package for surveying consultancy, preparation of feasibility study reports, design of construction drawings of work items construction of intersection when the outline of survey tasks was not close to reality (intersections related to the railway system), so it was necessary to sign an additional consulting contract for the topographic survey and railway signal information survey and reduce a number of other jobs with the consulting contractor (Thai Nguyen). - The surveying and designing of Viet Bac road phase II was not suitable with actual situation, leading to arising problems during the implementation process, so it was necessary to adjust and supplement to the design, increasing the estimate and increasing the initial contract value11. However, the designing and estimate of the above-mentioned additional adjustment items did not exceed the approved bid package estimate. (Thai Nguyen) - The survey and verification for relocation and site clearance were inaccurate, leading to inaccurate design and estimation of relocation plans. However, in the final settlement file A-B has reduced the volume that has not been relocated12 (Tuyen Quang) 10 Official Dispatch No. 106/BQLDA-MT dated 28/6/2021; Official Letter No. 429/UBND-DCXD dated July 1, 2021 of People's Committee of Dong Quang Ward, Official Letter No. 78/CV-UBND dated July 1, 2021 of People's Committee of Gia Sang Ward, Official Letter No. 135/UBND-VP dated 01 July 2021 of the People's Committee of Tan Lap ward. 11 Estimated value, contract value of package XL-03A2 to upgrade Viet Bac road phase 2-segment 1.2 increased by 5,878 million VND due to the adjustment of depth and volume of inappropriate excavation, soil filling, and additional drainage, pits. 12 The difference between the contract and the final settlement of items: Moving, replacing, supplementing, and reinstalling the power lines for 04 works under the project "Northern mountainous urban area - Tuyen Quang city", Phase 2 is 2,396 million VND contract value 3,678 million VND; settlement value of A-B 1,282 million VND); Moving, replacing, supplementing, and reinstalling domestic water lines for 03 work items under the project “urban development Program in mountainous area - Tuyen Quang city", Phase 2 is 1,365 million VND (contract value 2,799 VND); settlement value of A-B 1,433 million VND. 11 - Package 1 (Construction of works (including 2 items: Lia's1 Street and Tien Lung Street) remained some limitations, leading to adjusting and adding to many items13 during implementation (Tuyen Quang). - Estimates of works to improve and upgrade Nguyen Chi Thanh street, wrongly calculated the volume of some items with a reduced value of 252 million VND; Works of renovating, embellishing and repairing some roads connecting with Ho Trung Viet miscalculated the volume of some items with a reduced value of 2,973 million VND (the unit has corrected the volume when checking, accepting, making payment and finalization) (Tuyen Quang) - Estimation of Viet Bac road project in phase II was made unsuitably with construction drawing design, leading to increase in bidding package estimate and contract value.14 (Thai Nguyen). - Some construction and installation bidding packages have applied wrong unit prices of cement PCB30, PCB40 compared to prices in the August 2021 announcement of construction materials price No. 1768/SXD-KT dated 30/7/2021 of Yen Bai Department of Construction, brought about the increase of the estimate an amount of 51 million VND15. However, the estimated cost of the bidding package recalculated through audit was not lower than the winning bid price, so it does not waste investment capital (Yen Bai). The above responsibility belongs to the design consultancy unit; Tuyen Quang City Compensation and Site Clearance Board; PMUs and City People's Committee of: Thai Nguyen, Tuyen Quang, Yen Bai. (2) Contractor selection, negotiation, signing, and implementation of contracts - The fact that the investor, when making the bidding documents, did not clearly specify the principles and methods of measuring and bill of quantity 13 Works to renovate and upgrade Tien Lung street, Y La ward, Tuyen Quang city (hereinafter abbreviated as Tien Lung Street), Section 1: Adjustment of the central line; raising the red line because the elevation was not suitable with the core of the houses; Extending the culvert over the road due to the lack of approved design; …; Paragraph 2: Adjusting the elevation of the red line because the elevation is not suitable for the core of the houses; additional drains; drainage ditches; bearing culverts crossing the road; Infrastructure upgrading works for Lia's area, Tan Ha ward (Lia's1), groups 2, 3, 4, 14, 15, 16, 17, 18, 19, 25, 26, 27, 28, Tan Ha ward, Tuyen Quang city adjusted and supplemented many items and contents. 14 Package XL-03A2 upgrading Viet Bac road phase 2 - segment 1.2: wrong volume of lights leading to increase of the estimate 285.6 million VND, correspondingly increase of the contract price 356.57 million VND (in which the volume of lights was 342.8 million VND, the general cost was 13.7 million VND respectively); Package 03B Construction and installation of works of upgrading Viet Bac road phase 2 - segment 2: wrong volume of excavation and backfill, increasing the estimate an amount of 535.1 million VND, increasing the contract value an amount of 556.6 million VND, of which wrong volume of excavation and backfill was 535.1 million VND, the general cost was 21.4 million VND). 15 Package XL.NTT1: 7.4 million VND, Package XL.NTT2: 16.4 million VND; Package XL.NTT3: 10.6 million VND; Package XL. CLL: 13.5 million VND, Package XL.NVC: 3.1 million VND . 12 upon acceptance, payment and finalization of the contract was not in compliance with the provisions of Section 6, Appendix VI of Circular No. 13/2021/TT- BXD16 (Bac Kan). - Bidding package for testing and quality inspection in support for acceptance before handing over and putting into use: The project management unit based on the estimate made by the Department of Construction, approved by the City People's Committee to sign the contract No. 62/2017/HDTV-KD dated 29/12/2017 with the Construction Quality Accreditation Center of Dien Bien Province when the contractor selection has not been conducted. This undertaking was not in compliance with Section c, Clause 2, Article 138 of the Law on Construction No. 50/2014/QH13 (Dien Bien Phu) - Package No. 2: Construction of Items VII; IX, X: During the process of negotiating and signing the contract, the owners and related units have not yet signed the appendix to the contract to reduce the volume according to the design of construction drawings which have been adjusted and supplemented with the amount of 4,959 million VND. However, the PMU, the supervision consultant agencies and the construction contractors have made a minutes dated 30/11/2021 agreeing on reducing an amount equivalent to 4,959 million VND (Tuyen Quang). This issue is under the resposibility of PMUs of the following cities: Bac Kan, Dien Bien Phu, Tuyen Quang. (3) Management of the contract implementation progress - The construction progress of the bidding package items was not guaranteed compared with that stated in the signed initial contract, leading to the extension of the contract implementation schedule (Thai Nguyen17, Bac Kan18, 16 Bac Kan: Bidding package for construction of Doi Ky Bridge; Renovating, repairing and overcoming flooding in Bac Kan Secondary School and Upgrading and renovating Doi Ky and Ban Van Hoan streets 17 Thai Nguyen: The construction item of intersection between Thong Nhat and Viet Bac roads was 18 days behind schedule; Package XL-03B: Construction works: upgrading Viet Bac road phase 2 – section 2 delayed 25 months, XL-03A2 Construction work: upgrading Viet Bac road phase 2 - section 1.2 delayed 17 months, XL- 03A1 Construction and installation of Viet Bac road upgrading works, phase 2 - section 1.1, 16 months behind schedule 18 Bac Kan: Bidding package for construction of Nam Cut bridge: 23 months behind schedule; bidding package Construction of resettlement area delayed 23 months; bidding package Construction of the section from Km 0+700 to Km 2+40 of Tay Minh Khai Road: 21 months behind the schedule; Bidding Package for Construction of Doi Ky Bridge and Package for Construction of Renovation, Repairing and Fixing the flooding in Bac Kan Secondary School were 49 days behind the schedule; Bidding package: Construction of the section from Km 2+40 to Km 3+946.55 items: Tay Minh Khai Road 12 months behind schedule; Bidding package Construction and upgrading road from group 11B in Duc Xuan ward to group 11 in Phung Chi Kien ward: 13 months behind schedule; The bidding package for upgrading and renovating Doi Ky and Ban Van Hoan streets: 3 months behind schedule. 13 Dien Bien Phu19, Tuyen Quang20, Hoa Binh21). The reasons for the delay were the COVID-19 epidemic and the unfavorable weather condition from February 2022 till the reported time with prolonged rains and floods affecting the construction progress of the work and causing problems in solving site clearance. - The progress of compensation, site clearance and compensation payment to households in some provinces was still slow against the approved plan 22 (Thai Nguyen, Bac Kan). The reasons were that the capital source has not been arranged in time and the resettlement land fund has not been handed over on schedule; households did not agree with the compensation policy and unit price; it took a long time to settle disputes over land use rights for households within the site clearance; some households in the area of land clearance needed verifying their demographics, accommodation, etc. This issue is under the resposibility of Compensation and Site Clearance Councils, PMUs and People's Committees of Thai Nguyen city, Bac Kan city. (4) Acceptance, payment and settlement Some of acceptance and payment work were not consistent with the as- built documents, and have not yet made a deduction of 2% of VAT according to Article 1, Decree No. 15/2022/ND-CP and Official Letter No. 2688/BTC. -TCT dated 23/3/2022 of the General Department of Taxation, Ministry of Finance, leading to the SAV’s recommendation on adjustment, recovery and payment to the state budget, reducing the payment of the next period by the amount of 33,292,374,500 VND. It also meant not to be eligible for settlement payment of 35,519,445,943 VND (more details in Appendices No. 04; 04a; 05; 05a; 06; 07.3/BCKT-CTMT). 19 Dien Bien Phu: Bid package DB-21 for the construction of Him Lam resettlement area: 41 months behind schedule; Package DB-22 - Construction and installation of electrical system in resettlement area were delayed by 53 months; Bid package DB-23 Construction of the Reservoir behind the Provincial General Hospital was 24 months behind schedule; Package DB-40 – Construction of classroom blocks and auxiliary items of Tran Can Secondary School delayed 02 months; Package DB-28: Construction of Thanh Minh primary school was 29 months behind schedule; Package DB29 – Construction of Thanh Truong Nursery School was delayed by nearly 12 months; Package DB30 – Construction of Community Cultural House (Community Cultural House in Noong Chun village) 20 months behind schedule; Package DB19: 11 months delayed, Package DB18: 11 months later than planned; The DB20 bid package: 4 months later than planned. 20 Tuyen Quang Province: Package No. 2: Construction of Works Items VII, IX, X; Construction of Lia's 1 and Tien Lung Streets delayed 12 months; The construction of Nguyen Chi Thanh Street delayed 20 days and the road connecting the lake delayed 1.5 months. 21 Hoa Binh Province: Package 8 to upgrade and renovate Hoa Binh road delayed 46 months, and the package Construction of the infrastructure system together with the work of upgrading and renovating Hoa Binh road was 27 months behind schedule. 22 Thai Nguyen: The work of compensation for site clearance and payment of compensation to households was about 18 months behind the approved plan (31/12/2020). Bac Kan: The work of compensation, site clearance and 14 - In some bidding packages, finalization documents for approval was conducted slowly according to the Article 47, Decree 99/2021/ND-CP dated 11/11/2021 by the Government on management, payment and finalization of projects which use public investment capital 23. The above responsibility belongs to the PMUs and the People's Committees of the following cities: Tuyen Quang, Bac Kan, Hoa Binh, Dien Bien Phu, Thai Nguyen, Yen Bai. (5) Debt management As of 30/6/2022, the Program in Bac Kan city still owed 32,23 contractors an amount of 2 million VND (of which, 25,541 million VND has been arranged according to the public investment plan for the 2021-2025 period, and the rest of 6,691 million VND has not yet been allocated). This issue is under the responsibility of People Committees of Bac Kan city and Bac Kan province (6) Works quality management - The owners have not yet reached an agreement with the construction contractors on the form and content of the construction diary as a basis for implementation before the construction of the works. That was not in compliance with the Clause 2, Appendix IIA, Decree No. 06/2021/ND-CP dated 26/01/2021 by the Government; (Thai Nguyen, Bac Kan) - The labor safety and environmental sanitation plan was prepared by the contractor according to the instructions under Circular No. 04/2017/TT-BXD dated 30/03/2017 of the Ministry of Construction, but the owner did not require the contractor to prepare, submit a general plan on safety according to the contents specified in Appendix III of Decree No. 06/2021/ND-CP; detailed safety measures for jobs with high risk of occupational unsafety have been identified in the general plan on safety as prescribed at Point d, Clause 3, Article 13 Decree No. 06/2021/ND-CP. (Thai Nguyen) payment of compensation to households was about 30 months behind that in the approved plan No. 164/KH- UBND dated 28/12/2018 23 Bac Kan province: At the end of the audit, the following bidding packages to prepare the final settlement documents for approval were delayed: The construction package of Nam Cut Bridge delayed 12 months; bidding package for construction of resettlement areas was 12 months behind schedule; bidding package of Construction of the section from Km 0+700 to Km 2+40 items of Tay Minh Khai Road delayed 2 months; Bidding package of construction of the section from Km 2+40 to Km 3+946.55 of Tay Minh Khai Road, of which final products were handed over and put into use on 18/11/2021, 02 months late for final settlement; Bidding package of construction of upgrading road from group 11B, Duc Xuan ward to group 11, Phung Chi Kien ward: testing and acceptance of the completed volume was in January 2022; bidding package of upgrading and renovating Doi Ky and Ban Van Hoan streets: acceptance of the completed volume was in June 2022; the PMU and the units involved have been completing the project's finalization documents and submitting them for verification and approval of the final settlement according to regulations. 15 - Package DB-28 Construction and installation of Thanh Minh primary school: In the preparation of as-built documents for the transportation of waste soil and rock, there were no record of determining the transportation distance, location of the dump, reserves of dumping sites (for the transportation of waste for 7.7 km). (Dien Bien Phu) - Package DB-19 Construction of road from bridge A1 to bridge C4, from pile 0 to pile 82: There was lack of detailed as-built drawings which served as a basis for calculation and acceptance of workloads: pumping steel sheet piles (Larsen pile) on the ground, pile length <=12 m, grade I soil (Dien Bien Phu) - Package No. 2: Item VII: Renovating and upgrading the road from Tan Trao, passing through Thien Son quarry, group 18 Nong Tien through Dum village, Nong Tien ward - Tuyen Quang Buddhist Pagoda to Den Cam street, Trang Da commune: The rock strength test results have not been provided as a basis for determining rock grade; There were no detailed as-built drawings for rock excavation to determine the volume of rock excavation by mine exploding, using a D76 mm machine and rock breaking by an excavator fitted with a hydraulic hammer which served as a basis for payment of 14,007 million VND (the audited entity paid according to percentage) (Tuyen Quang) This issue is under the responsibility of PMUs and People’s Committees of the following cities: Thai Nguyen, Bac Kan, Dien Bien Phu, Tuyen Quang. (7) Acceptance and putting the works into operation: By the end of the audit, a number of construction and installation bidding packages have been completed but the procedures for handing over and putting into operation 24 have not been completed (Thai Nguyen, Bac Kan). This issue is under the responsibility of PMUs and People’s Committees of the following cities: Thai Nguyen, Bac Kan, (8) The documentation of Tuyen Quang City Project Management Unit still remained flaws, some records and documents were missing 25. This issue is under the responsibility of PMU and People’s Committee of the Tuyen Quang city. 24 Written approval of specialized management units for the works was eligible to ensure that the works to be put into operation and use. 25 Calculation of road surface structure, calculation and selection of longitudinal groove size, calculation of roof reinforcement works such as rock embankment, gabion (lane 436 Le Duan lane, Tuyen Quang province); Records of vehicle traffic survey, records of calculation of pavement structure (Works to renovate and upgrade Nguyen Chi Thanh Street; Works to renovate, embellish and repair some roads connecting with Trung Viet Lake; works to renovate, embellish and repair a number of roads in the area, upgrading infrastructure of Lia's Tan Ha area, Tuyen Quang province). 16 2.5. Site clearance There was lack of records, actual number paid for the compensation plan for site clearance, leading to ineligibility to settle the amount of 14,930 million VND. This responsibility belongs to the PMU and the Compensation and Site Clearance Council of Dien Bien Phu city. 2.6. Compliance with other relevant regulations - Some provinces have allocated counterpart funds to the local budget that are not enough compared to the medium-term public investment plan which has not complied with the program's adjustment documents with a shortage of 39,651 million VND26 (Thai Nguyen, Bac Kan). Yen Bai province allocated a lack of counterpart fund compared to the total approved investment of 8,611.8 million VND. Using IDA capital to pay value-added tax was not in compliance with Official Letter No. 9264/BTC-QLN dated 16/8/2021 by the Ministry of Finance on the extension and amendment of the Program financing agreement with the amount of 5,675 million VND (Bac Kan). The above responsibility belongs to the City People's Committees and the Provincial People's Committees of Thai Nguyen, Bac Kan, Yen Bai. 3. The implementation of the SAV’s recommendations On the basis of summarizing data on the implementation of audit recommendations of the units participating in the implementation of the Program in 2020, it was found that the Provincial People's Committees have directed the relevant units to address remainings and shortcomings in the management and implementation of the Program. Program implementation units have implemented the audit recommendations of the SAV, specifically: Increase budget revenue by 2,166 million VND; Budget recovery and reduction of investment spending: 8,142 million VND (details in the audit recommendation follow up report) III. ASSESSMENT OF ECONOMY, EFFECTIVENESS AND EFFICIENCY 1. General assessment The Ministry of Construction and the PMUs in charge of coordinating the Program have basically used norms and unit prices in the management of 26 Thai Nguyen: 14,110 million VND; Bac Kan: 25,541 million VND. 17 investment costs, administrative and non-business expenses, which have contributed to ensuring the economy in the use of program investment capital. Through the actual audit and study on project files, it is shown that the People's Committees of the provinces/cities and the PMUs implementing the Program have directed and implemented the anti-corruption plan, practiced thrift and anti-wastefulness. fee. All 7 Cities have fully set up a system to record and track complaints on the database system and on the logbook. Cases are collected, handled and stored according to the correct procedures. Inspectors of the Ministry of Construction regularly support the Project Management Boards in the process of receiving and solving cases, and through the means and business trips that have directly guided as well as organized the capacity improvement. effective implementation of the database system on PAP 1. The results of the Program's collection of feedback and complaints have been handled by the units in accordance with regulations. Accumulation from the beginning of the Program to date has recorded a total of 436 cases (62 new cases arise in 2021 alone); 430 cases have been resolved and 6 cases have been transfered to 2022. Through the results of the implementation of the audit recommendations from 2019 and earlier, the audit results showed that though there were still some shortcomings and limitations in the management and use of public finance and assets, the Ministry of Construction, the People's Committees of provinces/cities, the PMUs have promptly fixed them as per the SAV’s recommendations, and at the same time, seriously corrected and drawn lessons in management and financial-accounting management, investment cost management. Initially, there was no detection of limitations in the anti- corruption. 2. Shortcomings - Economy: Shortcomings in the acceptance and payment, leading to the adjustment of data according to the SAV audit results, affecting the economy of the Program. - Effectiveness: The program has not timely disbursed the World Bank loan, leading to the discard of the estimates, reducing the effectiveness of the Program. -Efficiency: The construction progress of some bidding packages still remained slow due to problems in compensation and site clearance, affecting the effectiveness of the Program. 18 PART TWO RECOMMENDATIONS 1. To the PMUs 1.1. Adjust accounting books, financial statements (investment capital, construction expenses) as of 30/6/2022 as the SAV’s recommendations and conclusions. 1.2. Finance-related settlement: total 34,399,093,782 VND, including: 1.2.1. Increase in budget revenue by 1,106,719,282 VND (Natural Resources Tax of 597,558,723 VND; Environmental protection fee of 509,160,559 VND) (Details are in Appendix 04/BCKT-CTMT, 04a/BCKT- CTMT) 1.2.2. Recovery to the State Budget the amount of 12,870,753,919 VND, including: recovery of the wrongly-spent of 910,159,460 VND; recovery of the unused budget of 11,960,594,459 VND, of which: 11,316,914,510 VND of central budget; 643,679,949 VND of local budget; 1.2.3. Decrease of payment for the next year: 5,045,405,292 VND; 1.2.4. Recovery of capital for the Program an amount of 5,675,373,227 VND, of which: Central budget 4,538,194,007 VND; Local budget 1,137,179,220 VND) 1.2.5. Deduct the contract value when paying for the acceptance volume for the following period 9,700,842,062 VND due to the wrong volume. (Further details in Appendices No. 05/BCKT-CTMT, 05a/BCKT-CTMT) 1.3. Others settlement: 35,519,445,943 VND (Further details in Appendix 06/BCKT-CTMT) 1.4. Improve the management and direction of the Program; management and use of public finance and public assets (1). To the PMU of Dien Bien Phu: - Coordinate with Dien Bien Provincial Tax Department to urge contractors to review and accurately recalculate natural resource tax and environmental protection fee, and at the same time, require construction contractors to declare and fully timely pay resource tax and environmental protection fee to the state budget according to regulations. - Preside over, and coordinate with relevant parties in making a record to determine the distance, location, and volume of the dumping site (for the transportation of waste for 7.7 km) to complete as-built procedures and 19 settlement according to regulations for the package DB-28- Construction and installation of Thanh Minh primary school; - Preside over and coordinate with relevant parties to make detailed as- built drawings to serve as a basis for calculation and acceptance of work volumes: Pumping steel sheet piles (Larsen piles) on the ground, length of piles <=12 m, grade I soil, Package DB-19 – Construction of road from bridge A1 to bridge C4, from pole 0 to pole 82; - Expeditiously gather documents and actual number of money paid on the compensation plan for site clearance to make settlement according to regulations; - Report to the respective Provincial People's Committees for consideration and decision on the signing of contract No. 62/2017//HDTV-KD by the PMU on December 29, 2017 with the Construction Quality Accreditation Center of Dien Bien province which had been done before the contractor selection for the package of quality testing and inspection to conduct settlement according to regulations. (2). To PMU of Hoa Binh city Expeditiously work with the State Treasury and related units to fully record revenues and expenditures according to regulations. (3). To PMU of Thai Nguyen city - Coordinate and work with Thai Nguyen State Treasury and related units to fully record revenues and expenditures according to regulations. - Coordinate with stakeholders to determine rock strength to serve as a basis for determining rock grade and to make detailed as-built drawings for rock excavation to determine volume of rock excavation by mine exploding, using D76 mm machine and rock breaking by hydraulic hammer-mounted excavator. Package 2: Item VII: Renovating and upgrading road from Tan Trao through Thien Son quarry, group 18 Nong Tien through Dum village, Nong Tien ward - Tuyen Quang Buddhist Zen Monastery to the road to settle the settlement according to regulations. (4). To PMU of Tuyen Quang city - Expeditiously work with the State Treasury and related units to record revenue and expenditure in full according to regulations. - Coordinate with relevant parties to determine rock strength as a basis for determining rock grade and make detailed as-built drawings for rock excavation work to determine volume of rock excavation by blasting work. using D76 mm machine and rock breaking by excavator with hydraulic hammer Head Package 20 2: Item VII: Renovating and upgrading the road from Tan Trao through Thien Son quarry, group 18 Nong Tien through the Dum village, Nong Tien ward - Tuyen Quang Buddism pagoda for settlement according to regulations. - For Package No. 2 - Construction of Items VII; IX, X, the PMU signed an appendix to the contract to reduce the volume according to the design drawings, which has been adjusted and supplemented with the amount of 4,959 million VND. (5). To PMU of Yen Bai city The PMU cooperated with relevant agencies to report to the Provincial People's Committee on the limitations and shortcomings of the Mid-term Public Investment Plan for the 2021-2025 period and the 2022 Capital Plan, such as: ODA (allocated from central state budget and on-lending budget by the provinces) which were not in accordance with the on-lending contract; lack of counterpart funds according to the requirements of the Program. (6). To PMU of Bac Kan city The PMU shall submit to the City People's Committee and relevant units to arrange counterpart fund to pay for capital construction debt and repay the IDA loan of the Program that has been used to pay taxes. (7). To the Urban Development Project Management Agency, Urban Development Department, Ministry of Construction Coordinate and urge the two units under the Ministry of Construction to participate in the Program (the Inspectorate of the Ministry of Construction and the Academy of Construction and Urban Management Officers) to return to the State budget the amount of funds which belong to the IDA allocated from central budget and not yet been spent. 1.5. Consider to claim collective and individual responsibilities 1.5.1. To lead an inquiry into conduct of the relevant organisations and individuals PMU of Dien Bien Phu city to draw experience in contract signing without conducting contractor selection according to regulations. 1.5.2. To draw experience for the relevant organisations and individuals (1). PMU of Dien Bien Phu Correct and draw lessons from shortcomings and errors in the following activities: The annual revenue growth index (DLI3.2) has not been achieved; the declaration and payment of natural resources tax have not yet been made as prescribed; making, allocating and assigning estimates were not yet in line with the ability to perform actual spending tasks; the unused state budget has not 21 been returned; contractor selection has not been conducted; the construction progress was not ensured as per the initially signed contract; there were errors in the acceptance, payment and settlement; The quality management of the works still lacked detailed as-built drawings, and there was no record of determining the distance to the dumping site. (2). PMU of Hoa Binh city Correct and draw lessons learned from shortcomings and errors in the following activities: The annual revenue growth index (DLI3.2) has not been achieved; revenues and expenditures have not yet been fully recorded; the construction progress was not ensured as per the initially signed contract; there were errors in the acceptance, payment and settlement. (3). PMU of Thai Nguyen city Correct and draw lessons learned from shortcomings and errors in the following activities: The annual revenue growth index has not been achieved (DLI 3.2); revenues and expenditures have not yet been fully recorded; VAT reduction has not been implemented according to Decree No. 15/2022/ND-CP; making, allocating and assigning estimates were not yet in line with the ability to perform actual spending tasks; The environmental impact assessment report has not been appraised; surveying for design was not in line with the actual condition; the estimates were not in line with the construction drawing design; the construction progress was not ensured as per the initially signed contract; the progress of compensation, site clearance and compensation payments to households remained behind schedule; there were errors in acceptance, payment and settlement; Units have not yet reached agreement with the construction contractor on the form and content of the construction diaries; contractors were not required to make and submit general plans on safety; The procedures for handing over and putting into use have not yet been completed. (4). PMU of Tuyen Quang city Correct and learn from the shortcomings and errors in the following activities: The annual revenue growth index has not been achieved (DLI 3.2), DLI 2 has not been achieved according to the Annual Enhancement Plan; revenues and expenditures have not yet been fully recorded; making, allocating and assigning estimates were not yet in line with the ability to perform actual spending tasks; the surveying to serve for the relocation and site clearance was not accurate; designing was limited; wrong estimate of volume; an appendix to the contract to reduce the volume has not been signed according to the adjusted and supplemented construction drawings; the construction progress was not 22 ensured as per the initially signed contract; there were errors in acceptance, payment and settlement; The quality management of the works still lacked detailed as-built drawings for rock excavation and rock strength test results; The documentation still had errors, some records and documents were missed. (5). PMU of Yen Bai city Correct and draw lessons learned from shortcomings and errors in the following activities: The annual revenue growth index (DLI3.2) has not been achieved; public investment plans were not yet consistent with the on-lending contract; estimate of a number of construction and installation bidding packages applied the wrong unit price of cement; there were errors in the acceptance, payment and settlement. (6). PMU of Cao Bang city Correct and draw lessons learned from shortcomings and errors in the following activities: The annual revenue growth index (DLI3.2) has not been achieved; making, allocating and assigning estimates were not yet in line with the ability to perform actual spending tasks. (7). PMU of Bac Kan city Correct and draw lessons learned from shortcomings and errors in the following activities: The annual revenue growth index (DLI3.2) has not been achieved; the formulation of public investment plans has not yet been consistent with actual situation; inadequate arrangement of counterpart funds, leading to debt for capital construction; VAT reduction has not been implemented according to Decree No. 15/2022/ND-CP; making, allocating and assigning estimates were not yet in line with the ability to perform actual spending tasks; principles and methods of bill of quantity when checking and accepting payment were not specified clearly; the construction progress was not ensured as per the initially signed contract; there were errors in acceptance, payment and settlement; the progress of compensation, site clearance and compensation payments to households remained behind schedule; there were errors in acceptance, payment and settlement; preparation of final settlement documents for approval have been conducted slowly; agreement with the construction contractor on the form and content of the construction diary has not been made; construction contractors have not been requested to submit measures to inspect and control the quality of materials, products, components and equipment used for the works; The procedures for handing over and putting into use have not been completed yet. 23 (8). Urban Development Project Management Unit, Urban Development Department, Ministry of Construction Correct and draw lessons learned from shortcomings and errors in the following activities: making, allocating and assigning estimates were not yet in line with the ability to perform actual spending tasks; the unused budget has not been recovered to the state budget. 2. People’s Committes of the cities (Owns) 2.1. Direct the PMUs to strictly, fully and promptly implement the conclusions and recommendations made by the SAV (Tuyen Quang, Bac Kan, Hoa Binh, Dien Bien Phu, Thai Nguyen, Yen Bai, Cao Bang) 2.2. People’s Committee of Yen Bai city Direct the PMU to promptly complete the Program's contents in accordance with the provisions of the Loan Agreement and the Program's regulations. 2.3. People’s Committee of Bac Kan city Allocate enough counterpart funds to pay off capital construction debts, repay the Program's IDA loans used to pay taxes and ensure compliance with the Program's Adjustment Documents. 2.4. People’s Committee of Thai Nguyen city Fully allocate counterpart funds to the local budget according to the medium-term public investment plan and ensure compliance with the Program's adjustment documents. 3. Tax Departments of Provinces - Dien Bien Provincial Tax Department to inspect and request the Project Management Unit of Dien Bien Phu city to put pressure on construction contractors to calculate, declare and fully and timely pay natural resources tax and environmental protection fee into the state budget according to regulations. - Tax Departments of Bac Kan province,Thai Nguyen province to inspect and request the respective PMUs to coordinate with construction and installation contractors to strictly implement the VAT reduction policy according to Article 1 of Decree No. 15/2022/ND-CP. 4. PPCs - Direct the People's Committees of cities and relevant units to strictly implement the conclusions and recommendations made by the SAV in audit minutes and this audit report. 24 - Direct the City People's Committees, the PMUs and relevant units to coordinate and finalize the recording of revenues and expenditures for the unrecorded expenses (Thai Nguyen, Tuyen Quang, Hoa Binh) - Bac Kan Provincial People's Committee to direct the Department of Planning and Investment, the Department of Finance and related units to advise the province to arrange local capital sources to repay the central budget an amount of 5,675,373,227 VND as they used IDA funds to pay the value added tax. - The People's Committee of Dien Bien province to direct PMU of Dien Bien Phu city to preside over and coordinate with related parties in making a record to determine the distance, location, and volume of the dumping site (for the transportation of waste for 7.7 km) for budget settlemen according to regulations (package DB-28- Construction and installation of Thanh Minh primary school”). - The People's Committee of Tuyen Quang province to direct the PMU of Tuyen Quang City to coordinate with related parties to determine the rock strength which then serves as a basis for determining the rock grade and making detailed as-built drawings for excavation work (to determine the volume of rock excavation by mine exploding) using a D76 mm machine and rock breaking by hydraulic hammer-head excavator. Package 2: Item VII: Renovation and upgrading the road from Tan Trao through Thien Son quarry, group 18 Nong Tien through Dum village, Nong Tien ward – Tuyen Quang Buddhist Padoga to Den Cam street, Trang Da commune for settlement according to regulations. - Direct relevant units to learn from experience on: Advising and submitting the medium-term public investment capital plan for the period 2021- 2025 and the capital plan in 2022, which was not consistent with the on-lending contract and the total investment adjustment of the Project (Thai Nguyen, Bac Kan, Yen Bai); the implementation of DLI index 3.2 to increase annual revenue did not meet the requirements of the Program (Tuyen Quang, Bac Kan, Hoa Binh, Dien Bien Phu, Thai Nguyen, Yen Bai, Cao Bang); the implementation of DLI index 2 under the Annual Enhancement Plan has not been completed (Tuyen Quang). - Direct the Departments of Planning and Investment and the Departments of Finance to correct the advisory work on the arrangement and allocation of local counterpart funds for the Program in accordance with the ratio specified in Official Letter No. 16986/BTC-QLN dated 21/11/2014 by the Ministry of Finance (Thai Nguyen, Bac Kan). 25 5. Ministry of Construction - Direct the People's Committees of cities, the Urban Development Project Management Unit, the Urban Development Department and relevant units to strictly implement the SAV’s conclusions and recommendations stated in the audit minutes and this audit report. - Direct the Urban Development Project Management Unit, the Urban Development Department and relevant units to coordinate with the Ministry of Finance and the State Bank's Transaction Office to clearly determine the status of the 5,000 million VND funding from the IDA capital source allocated from the central budget. The Ministry of Construction is kindly requested to direct audited entities to strictly and promptly implement the SAV’s recommendation given in this audit report, advise the audit results to the entities which have been subject to the specific audits, report results thereof to the Specialised Audit Department No. V at the address 116 Nguyen Chanh street, Cau Giay district, Hanoi before 31/12/2022 . It is requested to be clearly stated in the report on the audit recommendation implementation: implemented recommendations, ongoing ones and those have not been implemented (for the implemented ones, it is neccessary to clearly state the name of evidence enclosed with the copy of supporting documents, etc. For the 2 latter ones, units identify the reasons). When implement the SAV’s recommendations, units record supporting documents in accordance with instruction in Appendix No. 03/BCKT-CTMT and dispatches sent to the State Treasury listed in the Appendix No. 02/BCKT- CTMT. The audit report includes 21 pages, from page 1 to page 21 and Appendices No. 01; 02; 03; 04; 04a; 05; 05a; 06; 07.1; 07.2; 07.3; 08; 09; 10/BCKT-CTMT which are integral parts of the audit report./. HEAD OF SAV DELEGATION BY ORDER OF AUDITOR GENERAL CHIEF AUDITOR OF SPECIALIZED AUDIT DEPARTMENT V Nguyen Duc Dong State Auditor Card No.: B0124 Tran Hai Dong 26 Appendix No. 01/BCKT-CTMT LIST OF AUDITED ENTITIES I. GENERAL AUDIT Urban development project management Unit, Urban Development Agency, 1. Ministry of Construction II. SPECIFIC AUDIT Urban development project management Unit, Urban Development Agency, 1. Ministry of Construction 2. Project Management Unit of the Northern Mountain Program-Tuyen Quang City 3. Project Management Unit of the Northern Mountain Program-Yen Bai City 4. Project Management Unit of the Northern Mountain Program-Bac Kan City 5. Project Management Unit of the Northern Mountain Program-Cao Bang City 6. Project Management Unit of the Northern Mountain Program-Hoa Binh City 7. Project Management Unit of the Northern Mountain Program-Dien Bien Phu City 8. Project Management Unit of the Northern Mountain Program-Thai Nguyen City 27 Appendix No. 02/BCKT-CTMT LIST OF OFFICIAL DISPATCHES TO THE STATE TREASURY Official Name of the dispatches to Name of unit State the State launching the Treasury to Implementation of Treasury official carry out audit recommendations No. No. and sign Date dispatch transactions of audited entities 1 2 3 4 5 6 State Audit 729/KTNN- Central State 1 05/09/2022 Office of CNV Treasury Vietnam (SAV) Hoa Binh Project Management 735/KTNN- 05/09/2022 Provincial 2 SAV Unit of ODA funds - CNV State Hoa Binh City Treasury Yen Bai Project Management 736/KTNN- 05/09/2022 Provincial Unit of the Northern 3 SAV CNV State Mountain Urban Proram Treasury - Yen Bai City Thai Nguyen Project Management 732/KTNN- 05/09/2022 Provincial Unit of the Northern 4 SAV CNV State Mountain Urban Proram Treasury - Thai Nguyen City Bac Kan Project Management 731/KTNN- 05/09/2022 Provincial Unit of the Investment 5 SAV CNV State and Construction – Bac Treasury Kan City Dien Bien Project Management 734/KTNN- 05/09/2022 Provincial Unit of the Northern 6 SAV CNV State Mountain Urban Proram Treasury – Dien Bien Phu City Tuyen Quang Project Management 733/KTNN- Provincial Unit of the Northern 7 05/09/2022 SAV CNV State Mountain Urban Proram Treasury – Tuyen Quang City Hanoi city 730/KTNN- 8 05/09/2022 SAV State Ministry of Construction CNV Treasury 28 Appendix No. 03/BCKT-CTMT INSTRUCTION ON RECORDING DOCUMENTS FOR THE IMPLEMENTATION OF AUDIT RECOMMENDATIONS 1. For recommendations on increase of taxes, charges, increase of other receivables and wrong expenses ... to be paid at the State Treasury: Invoices on payment to the State Treasury where the audited units conduct transactions ( payment to the State budget, standing orders, payment orders, transfer orders, etc.), in addition to clearly describe the specific contents and amounts as prescribed, should clearly state: "Pay back the amount as recommended by the SAV in the budgetary year of ... (and the Official Dispatch No. ... dated ... / ... / ... of the SAV / KV ... sent to the State Treasury if any), and at the same time, tick the check box with name of SAV on the form of payment to the State budget.For cases the tax offices to impose tax arrears on the units: Decision of sanctioning and retrospective collection of tax administration agencies should clearly state the contents of "to conduct sanctioning and collection of arrears according to to the recommendation of the SAV in the budgetary year ... "; Payments to the state budget shall be clearly stated: "To pay fines and arrears collection according to the recommendations of the SAV for the budgetary year …." 2. For recommendations on reduction of settlement for construction investment fund, administrative funds with investment nature: invoices (decisions accept the final settlement, dossiers of payment, minutes of debt certification, decisions on Estimates adjustment, Adjustment Contracts ...) should clearly state : "Reduction in payment of the amount ..... (the specific amount) according to the recommendations of the SAV in budgetary year ..... (and the Official Dispatch No. ... dated ... / .. . / ... of the SAV / KV ... sent to the State Treasury, if any). If, for any reason, the invoices do not clearly state the contents, the audited units shall have to request competent authorized agencies to approve the final settlement (if the projects have completed its final settlement) or a written explanation with the certification from the Project's Owners and the contractors (if the project is not yet settled). 3.For recommendations of reduction in recurrent expenditure estimates: Decisions (assigning estimates, reducing budget estimates, etc.) must clearly state "Reduce the estimated amount of ..... (specific amount) according to recommendations of the SAV for the budgetary year ..... (and Official Dispatch No. ... dated ... / ... / ... of the SAV / KV ... sent to the State Treasury if any) If, for some reason, the documents do not clearly state the contents, the audited units shall have to request the agencies issuing the above-mentioned decisions to verify the contents and amounts of money for the implementation of the SAV's recommendations.. 29 30 1 Appendix No. 04/BCKT-CTMT SUMMARY OF RECOMMENDATIONS TO INCREASE STATE BUDGET IN 2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Taxes Reduce Environmental state Reduce Recovery No. Tax code Total House Envi. Other fees and Others VAT CI IE SC PI Environment budget VAT of VAT &land Protection taxes charges Classification Unit receivables refund A B C 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Project Management Unit of the Northern I 597,558,723 509,160,559 Mountain Program - 1,106,719,282 Dien Bien Phu City Truong Tho DB 1 5600120298 141,088,183 131,837,678 Limited Company 272,925,861 Hoang Anh Trading 2 and Service 5600167497 112,104,454 98,415,979 210,520,433 Investment Co., Ltd Manh Quan Investment and 3 5600149730 279,925,346 224,015,821 Construction Co., 503,941,167 Ltd Ngan Ha Co., Ltd., 4 5600173363 30,838,847 26,470,991 NE Province 57,309,837 5 HanCorp1 company 0107415688 33,601,894 28,420,090 62,021,984 Total 597,558,723 509,160,559 1,106,719,282 Note: -Details of the recommendations are provided in Appendix 04a, in which detailed explanation are noted: (i) For the increase in house and land tax collection, the details are as follows: Land use revenue (detailed for each project); Land rent collection (details of each project); other real estate. (ii) For other content of revenue increase, details are as follows: Dividends distributed and profits distributed; revenue from granting mining license of the project according to the decision of the Ministry of Natural Resources and Environment (if any); the projects under the decision of the Provincial People's Committee (if any); Other revenues (if any). - This table is applied uniformly with that enclosed with the official dispatch sent to the State Treasury; Only set and record the targets that arise; In case there are revenues that are not of the same nature as those shown in the appendix, other columns can be added (if necessary). 2 Appendix No. 04a/BCKT-CTMT EXPLANATION OF RECOMMENDATIONS TO INCREASE STATE BUDGET IN 2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Unit: VND Amount of No. Unit/classifications Tax code Reasons Note money 1 2 3 4 5 6 Project Management Unit - Dien Bien Phu I City 1,106,719,282 1 Resource tax 597,558,723 Package DB-23 Truong Tho DB Limited Company 5600120298 141,088,183 Hoang Anh Trading and Service Investment - Due to the inclusion of payable tax for land Co., Ltd 5600167497 78,235,506 exploitation activities for leveling and construction of works. Package DB-21 - According to the decisions No. 20/2020/QD- Manh Quan Investment and Construction 5600149730 195,791,712 UBND dated 30/9/2020 by the People's Committee Co., Ltd of Dien Bien province regulating the rates of Package DB-18 collection, exemption, reduction, collection, Ngan Ha Co., Ltd., Dien Bien Province 5600173363 30,838,847 payment, management and use of taxes and fees. Package DB-19 - Minutes of meeting dated 6/5/2022 on the Company HanCorp1 33,601,894 payment of natural resources tax and environmental protection fee for the DB 18, DB 19, DB 21, DB 23 Manh Quan Investment and Construction 5600149730 84,133,634 bidding packages between the Program PMU and Co., Ltd the construction contractors Hoang Anh Trading and Service Investment 5600167497 33,868,947 Co., Ltd 2 Environmental charges 509,160,559 Package DB-23 - Due to the inclusion of payable tax for land 3 Truong Tho Company Limited 5600120298 131,837,678 exploitation activities for leveling and construction Hoang Anh Trading and Service Investment of works. 5600167497 67,692,978 - According to the decisions No. 20/2020/QD- Co., Ltd UBND dated 30/9/2020 of the People's Committee Tender Package DB-21 of Dien Bien province regulating the rates of Manh Quan Investment and Construction 5600149730 collection, exemption, reduction, collection, Co., Ltd 154,353,134 payment, management and use of taxes and fees. Tender Package DB-18 - Minutes of meeting dated 6/5/2022 on the Ngan Ha Co., Ltd., Dien Bien Province 5600173363 26,470,991 payment of natural resources tax and environmental Tender Package DB-19 protection fee for the DB 18, DB 19, DB 21, DB 23 28,420,090 bidding packages between the Program PMU and Company HanCorp1 the construction contractors. Manh Quan Investment and Construction 5600149730 69,662,687 Co., Ltd Hoang Anh Trading and Service Investment 5600167497 30,723,001 Co., Ltd Total 1,106,719,282 4 Appendix No. 05/BCKT-CTMT SUMMARY OF RECOMMENDATIONS OF RECOVERY TO AND REDUCTION OF STATE BUDGET IN 2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Unit: VND Reduction of the Recovery of the wrongly Classifications Recovery of the balance estimates, payment for Decrease of spent to the State Budget the next year the Other TT Total remaining recoveries contract Capital Capital Capital price Units Recurrent Recurrent Recurrent construction construction construction A B 1 2 3 6 7 8 9 10 11 Central-level I units Ministry of 1 Construction 2,324,448,103 2,324,448,103 Investors, III PMU PMU of Tuyen 2 7,125,140,939 474,121,460 440,718,516 1,250,392,963 4,959,908,000 Quang City PMU of Yen 3 472,388,000 278,328,000 194,060,000 Bai City PMU of Bac 4 6,842,356,038 0 1,166,982,811 Kan City 5,675,373,227 PMU of Hoa 6 65,050,000 0 65,050,000 Binh city 5 PMU of Dien 7 9,659,731,840 157,710,000 9,195,427,840 306,594,000 Bien Phu city PMU of Thai 8 6,803,259,580 0 2,062,325,518 4,740,934,062 Nguyen city Total 33,292,374,500 0 910,159,460 2,324,448,103 9,636,146,356 0 5,045,405,292 9,700,842,062 5,675,373,227 Note: (i) Details of the recommendations are in Appendix 05a; Only set and record the items that arise; (ii) Column B: Prepare details for each unit, content, and investment project; (iii) Column 11- Other recovery: This column summarizes the recommendations related to the recovery and other payment to the state budget (not the same nature as the criteria of columns 2 to 10) and recommendations of: discarding the estimates, arranging to return to the sources, paying the unpaid payables; Proposals to submit to the Ministry of National Defense or the Ministry of Public Security for payment to the State Budget, and other proposals for recovery and payment to the state budget must be detailed in detail in Appendix 05a (then add notes accordingly) ); (iv) Not included in this table: The recommendations without enough sufficient and appropriate evidences; recommendations to complete procedures and documentation for investment project audits; reducing the contract price of the volume that the parties agreed not to conduct (having already been decided by the competent authority or adjusted by contract appendix); proposed adjustment of accounting numbers; proposed adjustment of the data between the balance and the source transfer; pay off-budget funds; urging the recovery of overdue advances; reduce the estimated value, the value of the approved bidding package; supplementing to the setting up of the financial reserve fund and land development fund; monitoring and setting aside sufficient sources for salary reform; Other recommendations not related to the recovery and reduction of state budget expenditures have been incorporated into other recommendations in Appendix 06/BCKT-CTMT. 6 Appendix No. 05a/BCKT-CTMT EXPLANATION OF RECOMMENDATIONS OF RECOVERY TO AND REDUCTION OF THE STATE BUDGET IN 2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Unit: VND Amount of No. Units, classifications and recommendations Explanation of the reasons Note money 1 2 3 4 5 TOTAL 33,292,374,500 Recovery of the irregulated spendings to the I 910,159,460 State Budget 1.1 PMU of Yen Bai City 278,328,000 Improper application of cost norms for appraisal of Budget settlement appraisal fee 278,328,000 settlement according to Circular No. 10/2020/TT- BTC dated 20/2/2020 by the Ministry of Finance 1.2 PMU of Dien Bien Phu city 157,710,000 DB-28: Construction of Thanh Minh Primary 1.2.1 88,998,000 Wrong volume School Bidding package: moving and returning the technical infrastructure system of Thanh Minh 1.2.2 Primary - Secondary School to be in line with the 68,712,000 Wrong volume general construction site of the Social Infrastructure works 1.3 PMU of Tuyen Quang City 474,121,460 7 Moving, replacing, supplementing and re-installing 1.3.1 electricity lines for 04 projects under the Program, 474,121,460 Wrong volume phase 2 II Recovery of unused budget/balance 11,960,594,459 Urban Development Project Management Unit, 2.1 Urban Development Department, Ministry of 2,324,448,103 Construction IDA funded budget allocated from the central budget 2.1.1 Non-business expenses 2,324,448,103 have no longer been used. 2.2 PMU of Tuyen Quang city 440,718,516 Moving, replacing, supplementing, and reinstalling The payment value exceeđe the settlement value, 2.2.1 domestic water lines for 03 works items under the 440,718,516 using counterpart fund allocated by the central budget Program, Phase 2 Recovery of advance balance (IDA-funded budget) as no longer be used (because they have not had to pay 2.3 PMU of Dien Bien Phu city 9,195,427,840 for residential land for households, but to exchange residential land according to the land allocation decision of the City People's Committee) Recovery of IDA-funded advance balance allocated 8,551,747,891 by the central budget which has been no longer used 2.3.1 Compensation and site clearance costs Recovery of IDA-funded advance balance allocated 643,679,949 by the central budget which has been no longer used (IDA capital reborrowed by localities) III Deduction of payment for next year 5,045,405,292 3.1 PMU of Tuyen Quang City 1,250,392,963 3.1.1 Construction cost 905,502,000 8 Package 1: Construction of civil works (including 2 items): Item 1: Upgrading the infrastructure of Lia's area, Tan Ha ward, groups 2, 3, 4, 14, 15 (former 609,409,000 Wrong volume group 40, Minh ward) Xuan), 16, 17, 18, 19, 25, 26, 27, 28 in Tan Ha Ward. Item III: Renovating and upgrading Tien Lung Street, Ỷ La Ward. Package 03: Construction and renovation of 43,618,000 Wrong volume Nguyen Chi Thanh street, Tuyen Quang city Package 2: Construction works: renovating, upgrading, embellishing and repairing some roads 238,471,000 Wrong volume connecting to Trung Viet lake Package 01: Construction works: Renovating, embellishing and repairing some roads in the area 14,004,000 Wrong volume of longitudinal groove on line of the infrastructure upgrade item of Lia'S Tan Ha area 3.1.2 Consulting expenses 84,341,000 Construction supervision of Package No. 03: Construction, renovation and upgrading of Nguyen 2,187,000 Chi Thanh Street, Tuyen Quang City Reduce the cost of construction supervision Construction supervision of Package 2: consultancy corresponding to the deducted Construction works: renovating, upgrading, construction value 82,154,000 embellishing, repairing some roads connecting with Trung Viet lake 3.1.3 Expenses for compensation for land clearance 260,549,963 Moving, replacing, supplementing, and reinstalling domestic water lines for 03 works items under the 143,292,091 Program, Phase 2 9 Wrong volume of concrete structure demolition, 84,264,348 concrete pouring M250 stone 1x2 Reducing the cost of preparing eco-technological reports, leading to the decrease of the construction value; Reducing the cost of hiring the project 59,027,743 management unit under the relocation budget item as this cost was included in the cost of the site clearance compensation council under the site clearance work. Building infrastructure for moving VNPT 117,257,872 information system 99,361,902 Wrong volume of cable tank construction Reducing the cost of preparing economic reports to 17,895,970 decrease according to the construction value Bac Kan City Construction and Investment Project 3.2 1,166,982,811 Management Board Construction costs 1,166,982,811 Construction of HM Road upgrading from group 3.2.1 11B, Duc Xuan ward to group 11, Phung Chi Kien 136,894,284 Wrong volume of earthwork ward 3.2.2 Construction of Doi Ky Bridge 450,373,429 Wrong work volume of soil, concrete, asphalt Upgrading and renovating Doi Ky and Ban Van Wrong volume of soil, concrete, and reinforcement 3.2.3 451,224,409 Hoan streets work Renovating, repairing and fixing the flooding 3.2.4 Wrong amount of formwork, expansion joints situation of Bac Kan Secondary School 128,490,689 Compensation costs for land clearance - 10 Cost of consultancy, acceptance of power-off of packages BKII-12, BKII-14: Construction of Nam - Cut Bridge and Construction of resettlement areas 3.3 PMU of Yen Bai City 194,060,000 3.3.1 Renovating and upgrading Nguyen Van Cu street 13,893,000 Wrong volume 3.3.2 Upgrading the bridge on Le Loi street 77,238,000 Wrong volume Renovating and upgrading Nguyen Tat Thanh 3.3.3 13,792,000 Wrong volume Street (KM0-KM1) Renovating and upgrading Nguyen Tat Thanh 3.3.4 63,728,000 Wrong volume Street (KM1-KM3) Renovating and upgrading Nguyen Tat Thanh 3.3.5 25,409,000 Wrong volume Street (KM3-KM4+424.57M) 3.4 PMU of Hoa Binh city 65,050,000 Wrong volume of roadbed excavation and 3.4.1 Upgrading and renovating Hoa Binh road 65,050,000 transportation 3.5 PMU of Dien Bien Phu city 306,594,000 Wrong volume of: Digging, shoveling and Construction of roads from bridge A1 to bridge C4 transporting of package DB 18; roofing, formwork, 3.5.1 63,803,000 from pole 0 to pole 82 (DB-18; DB-19; DB-20) concrete, gabion, land transportation of package DB 19 DB-30: Construction and installation of community 3.5.2 cultural houses: of Noong Chun Village, of Group 5,912,000 Wrong volume of construction and plastering of walls 3, Nam Thanh Ward; of Group 2, Noong Bua ward Him Lam Ward Resettlement Area (DB-21; DB-22; Wrong volume of sand buffer, digging soil 3.5.3 156,556,000 DB-40) foundation for pipelines, 11 Package DB-23: Construction and installation of Wrong mass of stone jetty. Buffer crushed aggregate 3.5.4 Air Conditioning Pool after Provincial General 76,558,000 base course foundation, K98 road foundation, Hospital maintaining trees for shade Reduction in the volume of construction and 3.5.5 Package DB-04: Supervision Consultant Phase II 3,765,000 installation bidding packages 3.6 PMU of Thai Nguyen city 2,062,325,518 Wrong volume, re-determine the price adjustment Construction and installation of work items value according to the completed volume in 3.6.1 Upgrading Viet Bac road phase 2 - Phase 1 (XL- 400,023,771 acceptance minutes, deduction of the general item 03A1) cost corresponding to the reduced volume value Construction and installation of work items: Wrong quantity, deduction of general item cost 3.6.2 Upgrading Viet Bac road phase 2 - Phase 2 (XL- 72,333,669 corresponding to the value of volume deduction 03B) Construction and installation of work items: Wrong quantity, deduction of general item cost 3.6.3 Upgrading Viet Bac road phase 2 - Phase 1 (XL- 383,940,201 corresponding to the value of volume deduction 03A2) XLBH08: Construction and construction works Wrong weight of cable conduit, 3cm thick foam 3.6.4 1,206,027,877 insurance layer,…; IV Reduction of the remaining contract value 9,700,842,062 4.1 PMU of Tuyen Quang City 4,959,908,000 Package 2: Construction of civil works (including 3 4.1.1 4,959,908,000 items): Item VII: Renovating and upgrading the road from Wrong volume of dropping gabion, digging Tan Trao passing through Thien Son quarry, group foundation to pour concrete valve pit, plastering - 18 Nong Tien through Dom village, Nong Tien 4,424,318,000 manholes, demolishing concrete structure, digging ward - Tuyen Quang Buddhist Pagoda to Den Cam and embanking roads street, Trang Da commune 12 Item X: Rehabilitation and upgrading of roads from Binh Thuan Street (National Highway 37) at Group Wrong volume of concrete structure demolition, road - 535,590,000 18, Hung Thanh Ward through Ngoc Kim embankment resettlement area to Le Loi extension road 4.2 PMU of Thai Nguyen city 4,740,934,062 Construction and installation of work item: 4.2.1 Upgrading Viet Bac road phase 2 - Phase 1 (XL- 655,526,767 Wrong volume of traffic signal system 03A1) Construction and installation of work item: 4.2.2 Upgrading Viet Bac road phase 2 - Phase 1 (XL- 342,856,476 Wrong weight of light poles 03A2) Construction and installation of work item: 4.2.3 Upgrading Viet Bac road phase 2 - Phase 2 (XL- 535,177,363 Wrong volume of earthwork 03B) XLBH08: Construction and construction works 4.2.4 3,207,373,456 Wrong weight of 3cm thick foam layer, tiles, reliefs insurance V Other recovery 5,675,373,227 Recovery of the program's costs The fact that the beneficial used IDA funds to pay value added tax was not in compliance with Official 5.1 PMU of Bac Kan city 5,675,373,227 Letter No. 9264/BTC-QLN dated 16/8/2021 by the Ministry of Finance on the extension and amendment of the Program financing agreement Recovery of IDA capital allocated by the central 5.1.1 4,538,194,007 budget that has paid VAT Physical construction cost Recovery of IDA-funded advance allocated by local 5.1.2 1,137,179,220 budgets which has paid VAT (IDA capital reborrowed by the localities) 13 Note: (i) Details for each item with arising increase corresponding to thosed in Appendix No. 05 (Setting up and recording only arising items) and detailing the content of items, works, and bidding packages of investment projects; in case there are items that are not of the same nature as those shown in the appendix, more lines may be added (if necessary); recommendations of other recovery must specify in detail the content of each recommendation, unit, item content, and works. (ii) Column 4: Clearly explain errors, basis, quote articles, clauses, reference number of legal documents. 14 Appendix No. 06/BCKT-CTMT SUMMARY OF OTHER RECOMMENDATIONS RESULTS-BASED NATIONAL URBAN DEVELOPMENT PROGRAM FOR THE NORTH MOUNTAIN REGION IN 2021 Unit, content of Amount of No. Explanation of the reason Note recommendations money 1 2 3 4 5 TOTAL 35,519,445,943 I PMU of Dien Bien Phu city 19,425,291,153 1 Construction costs 3,962,394,948 Project: Construction of road from bridge A1 to bridge C4 from pole 0 122,786,152 Lack of detailed as-built drawings. Steel sheet to pole 82 (DB-18; DB-19; DB-20) pile pumping (Larsen pile) There is no record of determining the location Package DB-28: Construction and of the dumping site, the distance of installation of Thanh Minh Primary 3,839,608,796 transportation and the dumping site reserve School under the Program, phase 2 capacity (2017-2020)" 2 Consultancy costs 44,610,000 Not eligible for confirmation due to ineligibility Package DB-04: Supervision 44,610,000 to confirm the construction cost of the DB-28 Consultant, Phase II contract package 3 Cost of site clearance 14,930,039,205 15 Lack of records, actual data paid on Cost of site clearance 14,930,039,205 compensation plan for site clearance 4 Other costs 488,247,000 The PMU signed the contract No. 62/2017//HDTV-KD on 29/12/2017 with the Expenses for testing and quality Construction Quality Accreditation Center of inspection to serve the inspection 488,247,000 Dien Bien province, when the contractor and acceptance work before selection had not been conducted. This was handing over and putting into use incompliant with Section c, Clause 2 Article 138 of the Law on Construction No. 50/2014/QH13. II PMU of Tuyen Quang City 14,007,343,070 Construction costs 2.1 14,007,343,070 Package 2 (Item VII): To renovate and upgrade the road from Package 2 (Item VII): To renovate Tan Trao through and upgrade the road from Tan Thien Son quarry, Trao through Thien Son quarry, The rock strength test results have not been group 18 Nong Tien group 18 Nong Tien through Dom provided as a basis for determining rock grade; 14,007,343,070 through Dom village, village, Nong Tien ward - Tuyen There was no detailed as-built drawing for rock Nong Tien ward - Quang Buddhist pagoda to Den excavation to determine the volume of rock Tuyen Quang Cam street, Trang Da commune excavation by mine exploding, using D76 mm Buddhist Padoga to machine and rock breaking by hydraulic Den Cam street, Trang hammer-head excavator. Da commune Breaking rocks of Breaking rocks of canals and canals and roadbeds roadbeds with D76mm drill - Rock 12,091,104,973 with D76mm drill - grade IV Rock grade IV 16 Breaking ground rock Breaking ground rock by excavator by excavator with with hydraulic hammer head - 1,916,238,097 hydraulic hammer Rock grade IV head - Rock grade IV III PMU of Thai Nguyen city 717,595,484 Construction and installation of The contract price adjustment value has not 3.1 work item: Upgrading Viet Bac 536,621,255 been determined at the time of acceptance of the road phase 2 - Phase 1 (XL-03A2) completed volume XLBH08: Construction and works 3.2 180,974,229 VAT reduction has not been applied according construction insurance to Article 1 of Decree No. 15/2022/ND-CP Xuan Phuong Construction dated 28/01/2022 by the Government 180,974,229 Trading Co., Ltd IV PMU of Bac Kan City 1,369,216,236 1 Construction costs 1,355,649,629 Construction of Doi Ky Bridge 955,438,906 Upgrading and renovating Doi Ky 299,080,705 and Ban Van Hoan streets VAT reduction has not been applied according Renovating, repairing and fixing to Article 1 of Decree No. 15/2022/ND-CP the flooding situation of Bac Kan 101,130,018 dated 28/01/2022 by the Government Secondary School Compensation costs for land 2 13,566,607 clearance 17 Construction cost to move water line for 02 new items: School + 10,015,145 Road Construction and installation of lines and substations within site clearance of item: road upgrading 3,551,462 from group 11B in Duc Xuan ward to group 11 in Phung Chi Kien ward 18 Appendix No. 07.1/BCKT-CTMT AUDIT OF STATE BUDGET EXPENDITURES SETTLEMENT BY BUDGET LIST RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Unit: VND Classifications Chapter Type Item Section Subsection Settled figures 1 2 3 4 5 6 7 I. REPORTED NUMBER 1,324,169,876,328 Ministry of Construction 599 280 332 12,906,555,231 PMU of Tuyen Quang City 599 280 292 123,385,121,815 PMU of Yen Bai City 599 280 292 102,464,042,000 PMU of Bac Kan City 599 280 332 205,244,933,510 PMU of Cao Bang city 599 280 283 45,843,068,012 PMU of Hoa Binh city 560 280 312 229,102,698,492 PMU of Dien Bien Phu city 599 312 159,484,775,053 PMU of Thai Nguyen city 599 312 445,738,682,215 II. AUDITED NUMBER 1,322,750,396,890 Ministry of Construction 599 280 332 12,906,555,231 PMU of Tuyen Quang City 599 280 292 122,470,281,839 PMU of Yen Bai City 599 280 292 102,185,714,000 PMU of Bac Kan City 599 280 332 205,241,382,048 19 PMU of Cao Bang city 599 280 283 45,843,068,012 PMU of Hoa Binh city 560 280 312 229,037,648,492 PMU of Dien Bien Phu city 599 312 159,327,065,053 PMU of Thai Nguyen city 599 312 445,738,682,215 III. DIFFERENCE (1,419,479,438) Ministry of Construction 599 280 - PMU of Tuyen Quang City 599 280 (914,839,976) PMU of Yen Bai City 599 280 (278,328,000) PMU of Bac Kan City 599 280 (3,551,462) PMU of Cao Bang city 599 280 - PMU of Hoa Binh city 560 280 (65,050,000) PMU of Dien Bien Phu city 599 312 (157,710,000) PMU of Thai Nguyen city 599 312 - 20 Appendix No. 07.2/BCKT-CTMT FINANCIAL SITUATION RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Unit: VND Total No. Classification Reported Audited number Difference number A B (1) (2) (3) = (2) - (1) 1 Domestic budget 1.1 The previous year's budget balance carried over 59,594,464,195 59,594,464,195 - 1.2 Estimates assigned for the year 446,828,541,000 446,828,541,000 - 1.3 Total used during the year 506,423,005,195 506,423,005,195 - 1.4 Actual expenses received in the year 353,357,743,163 353,357,743,163 - 1.5 Expenses proposed for settlement 339,929,769,551 339,647,890,089 (281,879,462) 1.6 Expenses reduction during the year 732,009,656 1,013,889,118 281,879,462 Balance is allowed to be carried over to the next year for use 1.7 165,761,225,988 165,761,225,988 - and settlement 2 Foreign aid 3 Foreign loan 3.1 The previous year's budget balance carried over 676,793,755,665 676,793,755,665 - 3.2 Estimates assigned for the year 1,365,008,117,953 1,365,008,117,953 - 3.3 Total used during the year 2,041,801,873,618 2,041,801,873,618 - 3.4 Total loan in the year 840,114,418,907 840,114,418,907 - Expenses used by the units and proposed for settlement in the 3.5 1,006,266,579,144 1,005,128,979,167 (1,137,599,976) year 21 3.6 Expenses reduction during the year 397,470,678,707 398,608,278,683 1,137,599,976 Budget allowed to be carried over to the next year for use and 3.7 638,064,615,768 638,064,615,768 - settlement Amount disbursed and withdrawn not yet recorded into the 3.8 h207,764,545 207,764,545 - state budget (not yet recorded in revenues-expenditures) 22 Appendix No. 07.3/BCKT-CTMT DETAILED AUDIT RESULTS OF INVESTMENT PROJECTS RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Unit: VND In which Recommendations for financial handling Disbursement No. Name of project Reported figure Audited figured Verified figures Difference value as of Recovery to Reduction of Decrese in Other handling Wrong unit Other Wrong volume Other errors 30/6/2022 state allocation remaining value price, norm recovery budget and payment of contracts A B 1 2 3 4= 3-2 5 6 7 8 9 10 12 13 TOTAL 1,381,937,613,143 (282,653,556) (36,255,299,285) 1,384,420,117,461 1,340,953,494,448 (41,475,010,695) (4,937,057,854) 2,504,764,684,443 910,159,460 5,045,405,292 9,700,842,062 35,519,445,943 I Approved settlement value 12,447,403,745 12,447,403,745 12,447,403,745 0 0 0 0 1,051,239,232,143 0 0 0 0 COMPENSATION COST C 11,832,204,956 11,832,204,956 11,832,204,956 0 0 0 0 1,048,938,009,135 0 0 0 0 FOE SITE CLEARANCE 1 PMU of Thai Nguyen city 11,832,204,956 11,832,204,956 11,832,204,956 0 0 0 0 1,048,938,009,135 0 0 0 0 D MANAGEMENT COSTS 532,238,512 532,238,512 532,238,512 0 0 0 0 1,376,941,237 0 0 0 0 1 PMU of Bac Kan City 532,238,512 532,238,512 532,238,512 0 0 1,376,941,237 E OTHER COSTS 82,960,277 82,960,277 82,960,277 0 0 0 0 924,281,771 0 0 0 0 1 PMU of Bac Kan City 82,960,277 82,960,277 82,960,277 0 0 0 0 924,281,771 0 0 0 0 Value of acceptance for II settlement A CONSTRUCTION COSTS 1,090,794,467,832 (4,325,556) (20,453,543,397) - 20,042,983,131 1,090,794,467,832 1,065,965,737,372 (24,828,730,460) (4,370,861,507) 965,163,007,381 88,998,000 4,696,749,329 9,700,842,062 1 PMU of Tuyen Quang City 224,000,788,356 - (14,007,343,070) 224,000,788,356 209,087,943,286 (14,912,845,070) (905,502,000) 137,983,292,795 - 905,502,000 4,959,908,000 14,007,343,070 - - 2 PMU of Yen Bai City 107,019,017,000 - - - - 107,019,017,000 106,824,957,000 194,060,000 194,060,000 76,228,500,000 - 194,060,000 3 PMU of Bac Kan City 170,902,921,972 170,902,921,972 168,380,289,532 (2,522,632,440) (1,166,982,811) 0 (1,355,649,629) 389,204,315,919 0 1,166,982,811 0 0 1,355,649,629 3.1 Construction of Nam Cut bridge 35,451,226 35,451,226 35,451,226 0 0 0 0 51,405,055,263 0 0 0 0 Me Linh Housing Development 18,305,222 18,305,222 0 35,986,061,023 0 and Construction Company 18,305,222 Thanh Phat Investment and Construction Joint Stock 17,146,004 17,146,004 0 15,418,994,240 0 17,146,004 Company Construction of resettlement 3.2 98,708,788 98,708,788 98,708,788 0 0 0 0 41,959,914,498 0 0 0 0 area Joint Venture Thang Long Joint 98,708,788 98,708,788 98,708,788 0 41,959,914,498 Stock Company 23 Construction of the section from 3.3 Km 0 + 700 to Km 2 + 40 items: 732,917,603 732,917,603 732,917,603 0 0 0 0 44,169,310,008 0 0 0 0 West Minh Khai Road Consortium of Tan Thinh Co., 232,555,653 232,555,653 0 30,161,736,009 Ltd 232,555,653 Construction Joint Stock 500,361,950 500,361,950 0 14,007,573,999 Company 399 500,361,950 Construction of the section from 3.4 Km 2 + 40 to Km 3 + 946.55 4,250,114,519 4,250,114,519 4,250,114,519 0 0 0 0 51,322,631,524 0 0 0 0 items: Tay Minh Khai Street Hong Ha Joint Stock Company 4,250,114,519 4,250,114,519 4,250,114,519 0 51,322,631,524 Construction of item: upgrading toad from group 11B, Duc Xuan 3.5 26,875,890,110 26,875,890,110 26,738,995,826 (136,894,284) (136,894,284) 0 0 40,729,344,548 0 136,894,284 0 0 ward to group 11, Phung Chi Kien ward Me Linh Housing Development 14,486,881,523 14,413,107,480 (73,774,043) (73,774,043) 23,277,322,489 73,774,043 and Construction Company 14,486,881,523 Phu Thanh Construction Co., 5,596,186,479 5,541,283,456 (54,903,023) (54,903,023) 10,566,683,843 54,903,023 Ltd 5,596,186,479 Huy Hoan Co., Ltd 6,792,822,108 6,784,604,890 (8,217,218) (8,217,218) 6,885,338,216 8,217,218 6,792,822,108 3.6 Construction of Doi Ky Bridge 88,343,179,310 88,343,179,310 86,937,366,975 (1,405,812,335) (450,373,429) 0 (955,438,906) 74,559,030,039 0 450,373,429 0 0 955,438,906 Construction and Investment 88,343,179,310 86,937,366,975 (1,405,812,335) (450,373,429) (955,438,906) 74,559,030,039 450,373,429 955,438,906 Joint Stock Company 492 88,343,179,310 Upgrading and renovating Doi 3.7 17,765,393,868 17,765,393,868 17,015,088,754 (750,305,114) (451,224,409) 0 (299,080,705) 74,559,030,039 0 451,224,409 0 0 299,080,705 Ky and Ban Van Hoan streets Hong Ha Joint Stock Company 17,765,393,868 17,015,088,754 (750,305,114) (451,224,409) (299,080,705) 74,559,030,039 451,224,409 299,080,705 17,765,393,868 Renovating, repairing and 3.8 fixing the flooding of Bac Kan 32,801,266,548 32,801,266,548 32,571,645,841 (229,620,707) (128,490,689) 0 (101,130,018) 10,500,000,000 0 128,490,689 0 0 101,130,018 Secondary School Thang Long Joint Stock 32,801,266,548 32,801,266,548 32,571,645,841 (229,620,707) (128,490,689) (101,130,018) 10,500,000,000 128,490,689 101,130,018 Company 5 PMU of Hoa Binh city 47,121,190,818 47,121,190,818 47,056,140,818 (65,050,000) (65,050,000) 0 0 33,056,034,358 0 65,050,000 0 0 6 PMU of Dien Bien Phu city 235,139,861,539 235,139,861,539 230,785,639,591 (4,354,221,948) (391,827,000) 0 (3,962,394,948) 121,320,660,890 88,998,000 302,829,000 0 3,962,394,948 7 PMU of Thai Nguyen city 306,610,688,147 306,610,688,147 303,830,767,145 (2,779,921,002) (1,647,439,696) (4,325,556) (1,128,155,750) 207,370,203,419 0 2,062,325,518 4,740,934,062 0 717,595,484 B EQUIPMENT COST 371,358,000 371,358,000 371,358,000 0 1 PMU of Bac Kan City 371,358,000 371,358,000 371,358,000 0 COMPENSATION COST C 226,023,465,941 226,023,465,941 210,276,476,706 (15,746,989,235) (562,431,347) 0 (15,184,557,888) 429,688,107,215 542,833,460 260,549,963 0 0 14,943,605,812 FOR SITE CLEARANCE 1 PMU of Tuyen Quang City 30,001,890,339 30,001,890,339 29,267,218,916 (734,671,423) (493,719,347) 0 (240,952,076) 29,456,904,455 474,121,460 260,549,963 0 0 0 2 PMU of Yen Bai City 4,490,896,000 4,490,896,000 4,490,896,000 0 0 0 0 4,146,688,000 3 PMU of Bac Kan City 14,938,408,271 14,938,408,271 14,924,841,664 (13,566,607) 0 0 (13,566,607) 125,462,628,753 0 0 0 13,566,607 Construction cost to move water (10,015,145) (10,015,145) 10,015,145 line for 02 new items: School + 24 Road (Bac Kan Water Supply and Sewerage Joint Stock Company) Construction and installation of equipment for transmission lines and substations within site clearance of item: road upgrading (3,551,462) (3,551,462) 3,551,462 from group 11B in Duc Xuan ward to group 11 in Phung Chi Kien ward (Khang Thinh Joint Stock Company) 5 PMU of Hoa Binh city 329,630,176 329,630,176 329,630,176 0 0 0 0 329,630,176 0 0 0 0 6 PMU of Dien Bien Phu city 20,523,768,505 20,523,768,505 5,525,017,300 (14,998,751,205) (68,712,000) 0 (14,930,039,205) 5,593,729,300 68,712,000 14,930,039,205 7 PMU of Thai Nguyen city 155,738,872,650 155,738,872,650 155,738,872,650 0 0 0 0 264,698,526,531 0 0 0 0 D MANAGEMENT COSTS 11,979,012,440 11,979,012,440 11,979,012,440 0 0 0 0 17,354,987,669 0 0 0 0 1 PMU of Tuyen Quang City 2,076,314,025 2,076,314,025 2,076,314,025 0 0 0 0 2,076,314,025 2 PMU of Yen Bai City 1,524,522,000 1,524,522,000 1,524,522,000 3,130,511,000 3 PMU of Bac Kan City 1,000,000,000 1,000,000,000 0 0 5,015,463,481 1,000,000,000 4 PMU of Cao Bang city 907,017,847 907,017,847 907,017,847 0 0 907,017,847 5 PMU of Hoa Binh city 895,477,252 895,477,252 895,477,252 0 650,000,000 6 PMU of Dien Bien Phu city 5,575,681,316 5,575,681,316 5,575,681,316 0 5,575,681,316 COSTS OF CONSTRUCTION E INVESTMENT 35,077,051,505 32,888,972,187 32,756,256,187 (132,716,000) (3,765,000) 0 (128,951,000) 30,624,196,838 0 88,106,000 0 44,610,000 CONSULTANCY 1 PMU of Tuyen Quang City 1,353,708,000 1,353,708,000 1,269,367,000 (84,341,000) 0 0 (84,341,000) 822,004,100 0 84,341,000 0 0 2 PMU of Yen Bai City 4,242,853,000 4,242,853,000 4,242,853,000 2,841,524,000 3 PMU of Bac Kan City 7,344,614,392 7,344,614,392 7,344,614,392 0 0 0 0 9,781,258,612 0 0 0 0 5 PMU of Hoa Binh city 2,133,320,000 2,133,320,000 2,133,320,000 0 505,406,000 6 PMU of Dien Bien Phu city 9,736,153,451 8,901,782,133 8,853,407,133 (48,375,000) (3,765,000) 0 (44,610,000) 8,159,242,133 0 3,765,000 0 44,610,000 7 PMU of Thai Nguyen city 8,912,694,662 8,912,694,662 8,912,694,662 0 0 0 0 7,692,757,893 0 0 0 0 F OTHER COSTS 8,098,715,998 7,804,290,998 7,528,607,998 (766,575,000) 0 (278,328,000) (488,247,000) 10,695,153,197 278,328,000 0 0 488,247,000 1 PMU of Tuyen Quang City 963,714,000 963,714,000 963,714,000 0 0 0 0 963,714,000 2 PMU of Yen Bai City 1,210,398,000 1,210,398,000 1,422,962,000 (278,328,000) 0 (278,328,000) 0 1,842,828,000 278,328,000 0 0 0 3 PMU of Bac Kan City 4,647,028,530 4,647,028,530 4,647,028,530 0 0 0 0 6,699,887,998 0 0 0 0 4 PMU of Cao Bang city 30,000,000 30,000,000 30,000,000 0 0 30,000,000 0 0 0 0 6 PMU of Dien Bien Phu city 782,672,000 488,247,000 0 (488,247,000) 0 0 (488,247,000) 221,436,000 488,247,000 7 PMU of Thai Nguyen city 464,903,468 464,903,468 464,903,468 0 0 0 0 937,287,199 0 0 0 0 Total Note: (i) Column “Difference” (column 7) needs explaining in detail the content; (ii) Financial handling recommendations (columns 9, 10, 11, 12) will be summarized in Appendix No. 05/BCKT-CTMT; recommendations for other handling (Column 13) will be summarized in Appendix No. 06/BCKT-CTMT; (iii) Section IV “Approved Estimate/Bidding Package Price”: Only present in this table if all arising in the estimate is audited and related t o financial handling. 25 Appendix No. 08/BCKT-CTMT ACCOUNTING BALANCE SHEET AS OF 30/6/2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORTHERN MOUTAINS REGION FOR 2021 Total TT Classifications Reported figure Audited figure Difference A B (1) (2) (3) = (2) - (1) ASSETS A. SHORT-TERM ASSETS 218,083,636,508 219,438,065,946 1,354,429,438 I. Money 115,594,481,594 115,594,481,594 - Cash on hand 8,342,619,212 8,342,619,212 - Bank deposits, treasury 29,178,349,123 29,178,349,123 - Deposit 873,350,301 873,350,301 - Treasury Deposit (IDA Capital) 74,660,875,605 74,660,875,605 - Other deposit 2,539,287,353 2,539,287,353 - Counterpart fund deposits - - - II. Receivables 102,105,140,914 103,459,570,352 1,354,429,438 Advance paid to the suppliers 101,002,214,863 101,002,214,863 - Other receivables 1,102,926,051 2,457,355,489 1,354,429,438 III. Other current assets 384,014,000 384,014,000 - Advance 384,014,000 384,014,000 - FIXED ASSETS AND ONGOING PYSICAL B. 5,754,756,269,911 5,746,809,796,178 (7,946,473,733) CONSTRUCTION INVESTMENT COSTS I. Fixed assets 488,364,647 488,364,647 - Tangible fixed assets 488,364,647 488,364,647 - 26 - Original 2,943,698,400 2,943,698,400 - - Accumulated depreciation costs (2,455,333,753) (2,455,333,753) - Intangible fixed assets - - - - Original 641,520,000 641,520,000 - - Accumulated depreciation (641,520,000) (641,520,000) - II. Cost of capital construction investment 5,689,723,189,004 5,681,776,715,271 (7,946,473,733) Cost of capital construction investment 5,682,503,616,053 5,674,557,142,320 (7,946,473,733) Other expenses 7,219,572,951 7,219,572,951 - III. Administrative and non-business expenses 64,096,516,260 64,096,516,260 - Administrative and non-business expenses 64,096,516,260 64,096,516,260 - IV. Interest on loans borrowed by local IDA source 448,200,000 448,200,000 - TOTAL ASSETS 5,972,839,906,419 5,966,247,862,124 (6,592,044,295) CAPITAL - - - A. LIABILITIES 619,371,496,976 612,779,452,681 (6,592,044,295) I. Short-term debts 619,371,496,976 612,779,452,681 (6,592,044,295) Short-term payables to suppliers 466,336,660,982 459,744,616,687 (6,592,044,295) IDA-funded advance has not been recorded in 142,854,948,992 142,854,948,992 - revenues and expenditures Advance from city budget 500,000,000 500,000,000 - Advance from the provincial budget 619,685,930 619,685,930 - Other payables (Contract implementation 2,848,537,044 2,848,537,044 - guarantee) Other payables - Borrowing from the provincial/city budget 3,590,418,856 3,590,418,856 - 27 II. Long-term liabilities - - - Long-term supplier payable - - - B CAPITAL 5,353,468,409,443 5,353,468,409,443 - IDA capital source (recorded revenues and 3,725,591,857,930 3,725,591,857,930 - expenditures, allocated by the central budget) IDA capital borrowed by the localities (Recorded 389,596,487,783 389,596,487,783 - revenues and expenditures) Counterpart fund 1,233,465,626,315 1,233,465,626,315 - IDA capital source (not recorded revenues and - - - expenditures) Capital has formed fixed assets 413,864,647 413,864,647 - Dunds from the State budget to pay interest of - - - relending of the localities Other sources of capital 4,191,572,768 4,191,572,768 - Collect money from selling bidding documents 209,000,000 209,000,000 - Budget allocated from central state budget Budget arranged by the localities - - - TOTAL 5,972,839,906,419 5,966,247,862,124 (6,592,044,295) 28 Appendix No. 09/BCKT-CTMT REPORT ON THE OPERATION RESULT From January 1, 2021 to June 30, 2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORHERN MOUTAINS REGION FOR 2021 Unit: VND Total No. Classification Reported Figure Audited Figure Difference A B (1) (2) (3) = (2) - (1) I Operation revenues 1 Revenue from IDA capital 868,995,417,904 868,995,417,904 - Advances from the World Bank source which have not yet recorded 86,893,850,412 86,893,850,412 - revenues and expenditures (-) Budget allocated from central budget 45,064,872,389 45,064,872,389 - (-) On-lending 41,828,978,024 41,828,978,024 - Advances from the World Bank source which have been recorded 782,101,567,492 782,101,567,492 - revenues and expenditures (-) Budget allocated from central budget 634,153,218,723 634,153,218,723 - (-) On-lending 147,948,348,770 147,948,348,770 - 2 Revenuew from counterpart funds 319,751,428,816 319,751,428,816 - (-) Budget allocated from central budget 127,044,740,191 127,044,740,191 - (-) Local budget 192,706,688,625 192,706,688,625 - 3 Revenues from other sources 42,334,354,317 42,334,354,317 - - Collecting and selling bidding documents 8,000,000 8,000,000 - - Recovery recommended by the audit 6,000,000 6,000,000 - - Collecting the contract performance guarantee 355,588,575 355,588,575 - 29 - Other revenues 41,964,765,742 41,964,765,742 - Adjusting capital sources according to disbursement results - - - Total operation revenues (1+2+3) 1,231,081,201,037 1,231,081,201,037 - II Operation expenditures 1,430,681,160,195 1,422,734,686,462 (7,946,473,733) 1 Spending on capital construction investment 1,393,160,167,609 1,385,213,693,876 (7,946,473,733) 2 Administration and career expenses - - - 3 Other expenses 37,520,992,586 37,520,992,586 - Total operation expenditures (1+2+3) 1,430,681,160,195 1,422,734,686,462 (7,946,473,733) III Difference (199,599,959,158) (191,653,485,424) 7,946,473,733 IV Beginning balance (231,247,891) (231,247,891) 918,020,430 V Ending balance (394,095,460,674) (368,529,583,619) 25,565,877,055 30 Appendix No. 10/BBKT-CTMT REPORT ON REVENUES-EXPENDITURES From 01/01/2021 to 30/6/2022 RESULT-BASED NATIONAL URBAN DEVELOPMENT PROGRAM IN THE NORHERN MOUTAINS REGION FOR 2021 Unit: VND Total No Classification Reported figure Audited figure Difference A B (1) (2) (3) = (2) - (1) I Money received in the year 1,299,824,492,446 1,299,824,492,446 - From the WB 927,564,862,905 927,564,862,905 - From counterpart funds 325,579,688,176 325,579,688,176 - Advance from provincial and municipal budget 33,546,561,420 33,546,561,420 - Sales of bidding documents 14,000,000 14,000,000 - Revenues from advance Other revenues 8,760,340,238 8,760,340,238 - Total revenues 1,299,824,492,446 1,299,824,492,446 - II Money spent in the year - - - 1 Spending on physical construction investment 1,216,371,319,800 1,216,371,319,800 - Construction expenses 974,301,850,980 974,301,850,980 - Equipment expenses - - - Site clearance costs 192,835,962,025 192,835,962,025 - Project management costs 13,561,166,605 13,561,166,605 - Construction consulting costs 27,278,056,836 27,278,056,836 - Other costs 8,394,283,354 8,394,283,354 - 2 Administration and career expenses 10,925,455,231 10,925,455,231 - Administration and career expenses 10,925,455,231 10,925,455,231 - 31 3 Other expenses 116,537,759,512 116,537,759,512 - Advance payment 59,926,251,472 59,926,251,472 Other expenses 56,611,508,040 56,611,508,040 Total expenditure 1,343,834,534,543 1,343,834,534,543 - III Net money from operations (44,010,042,097) (44,010,042,097) - IV Beginning balance 159,604,523,691 159,604,523,691 - V Eending balance 115,594,481,594 115,594,481,594 -