EMERGENCY SUPPORT FOR MSMEs PROJECT
IDA CREDIT N0.6758-KG
IDA GRANT NO.D706-KG
AIIB LOAN NO.L0423A
COORDINATED BY
CREDIT LINE MANAGEMENT UNIT UNDER MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC
(“CLMU”)
SPECIAL PURPOSE FINANCIAL STATEMENTS
AND
INDEPENDENT AUDITOR’S REPORT
For the year ended 31 December 2021
BISHKEK
June 2022
EMERGENCY SUPPORT FOR MSMEs PROJECT
IDA CREDIT N0.6758-KG
IDA GRANT NO.D706-KG
AIIB LOAN NO.L0423A
TABLE OF CONTENTS
Page
STATEMENT OF M ANAGEMENT’S RESPONSIBILITIES FOR THE PREPARATION
OF THE SPECIAL PURPOSE FINANCIAL STATEMENTS 3
INDEPENDENT AUDITOR’S REPORT 4-5
SPECIAL PURPOSE FINANCIAL STATEMENTS
For the year ended 31 December 2021:
Statement of cash receipts and payments 6
Statement of expenditures per components 7
Notes to the special purpose financial statements 8-17
ANNEX 1. RECONCILIATION BETWEEN THE AMOUNTS SUBMITTED BY THE CLMU AND DISBURSED BY
THE WORLD BANK 18
2
STATEMENT OF M A N A G EM EN T ’S R E SP O N SIB ILIT IES FOR THE PREPARATION
OF THE SP E C IA L P U R P O SE FINANCIAL STATEM EN TS
The management of Credit Line Management Unit Under Ministry Of Finance of the Kyrgyz Republic
(“CLMU”) is responsible for the preparation of the special purpose financial statements for the year
ended 31 December 2021 of “Emergency Support for MSMEs Project” (“the Project”) financed by
Financing Agreement IDA Credit N0.6758-KG and IDA Grant No.D706-KG, and Loan Agreement AIIB
Loan No.L0423A, in compliance with the International Public Sector Accounting Standard “Financial
Reporting under the Cash Basis of Accounting” (IPSAS-Cash Basis) issued by the International Public
Sector Accounting Standards Board (IPSASB) and the Financial Management Manual for World Bank
Financed Investment Operations (WB Guidelines).
In preparing the special purpose financial statements, CLMU’s management is responsible for:
• Properly selecting and applying accounting policies;
• Presenting information, including accounting policies, in a manner that provides relevant,
reliable, comparable and understandable information;
• Providing additional required disclosures for the year ended 31 December 2021.
CLMU’s Management is also responsible for:
• Designing, implementing and maintaining an effective and sound system of internal controls,
throughout the Project;
• Maintaining adequate accounting records that are sufficient to show and explain the Project’s
transactions, and which enable them to ensure that the special purpose financial statements
of the Project comply with IPSAS - Cash Basis and the WB Guidelines ;
• Taking such steps that are reasonably available to them to safeguard the assets of the Project
and to affirm that funds received have been used in accordance with the Financing Agreement
IDA Credit No.6758-KG and IDA Grant No.D706-KG, and AIIB Loan No.L0423A both dated 2
September 2020, and World Bank related guidelines, with due attention to economy and
efficiency, and only for the purposes for which the financing was provided; and
• Preventing and detecting fraud and other errors.
The special purpose financial statements for the year ended 31 December 2021 were signed on 10
June 2022 by the CLMU’s Management.
3
Tel: +374 60 52.8899 23/6, Davit Anhaght Str.,
JBDO E-mail: bdo®bdoarm enia.am
www.bdoarmenia.am
5th Floor, office 7
Yerevan, Armenia
INDEPENDENT AUDITOR’S REPORT
To the Ministry of Finance of the Kyrgyz Republic
Opinion
We have audited the special purpose financial statements of “Emergency Support for MSMEs
Project” (“Project”) financed by Financing Agreement IDA Credit No.6758-KG and IDA Grant
No.D706-KG, and Loan Agreement AIIB Loan No.L0423A both dated 2 September 2020 (“Financing
Agreement), and coordinated by the Credit Line Management Unit Under Ministry Of Finance of the
Kyrgyz Republic (“C LM U”), which comprise the statement of cash receipts and payments, and the
statement of expenditures per components for the year ended 31 December 2021, and notes to the
special purpose financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements for the year ended 31 December 2021 are
prepared, in all material respects, in accordance with International Public Sector Accounting
Standard: Financial Reporting Under the Cash Basis of Accounting, (IPSAS-Cash Basis).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) as issued by
International Auditing and Assurance Standards Board (IAASB). Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report.
We are independent of the Project and of the CLMU in accordance with the International Ethics
Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code), and we
have fulfilled out other ethical requirements in accordance with IESBA Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Emphasis of Matter- Cash Basis of Accounting
Without modifying our opinion, we draw attention to Note 2 to the financial statements, which
describes that financial statements are prepared in accordance with cash basis framework, as a
result, they may not be suitable for another purposes.
Emphasis of Matter- Project progress
Without modifying our opinion, we draw attention to Note 7 to the financial statements, which
describes the reasons for slow progress of the project.
Responsibilities of the Management for the Financial Statements
Management of the CLMU is responsible for the preparation and presentation of the special purpose
financial statements in accordance with IPSAS-Cash Basis issued by the International Public Sector
Accounting Standards Board (IPSASB) and Financial Management Manual for World Bank Financed
Investment Operations (“WB Guidelines”), and for such internal control as management determines
is necessary to enable the preparation of special purpose financial statements that are free from
material misstatement, whether due to fraud or error.
4
Auditor’s Responsibility for the Audit of the Special Purpose Financial Statements
Our objectives are to obtain reasonable assurance about whether the special purpose financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is high level of assurance,
but is not a guaranty that an audit conducted in accordance with ISAs will always detect a material
misstatement when it exists. Misstatements arise from fraud and error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these special purpose financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgement and maintain
professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the special purpose financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis
for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
We communicate with management regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
Report on Other Legal Requirements
To comply with the terms of the Financing Agreement, the CLMU management shall insure that:
1. funds have been used in accordance with the conditions of the Financing Agreement
concluded between the International Development Association (IDA) and the Kyrgyz
Republic, and Loan Agreement concluded between the Asian Infrastructure Investment Bank
(AIIB) and the Kyrgyz Republic, and World Bank related guidelines, with due attention to
economy and efficiency, and only for the purposes for which the financing was provided;
2. supporting documents, records and accounts have been maintained to support claims for
reimbursement of expenditures incurred. Expenditures included in the withdrawal
applications and reimbursed against are eligible for financing under the Financing
Agreement. Interim Unaudited Financial Statements (IFSs) issued by CLMU during the
reporting period are in agreement with the underlying books of account;
3. The Designated account used has been maintained in accordance with the provision of the
Financing Agreement, and World Bank related guidelines.
4. Goods and Services financed have been procured in accordance with the Financing
Agreement and World Bank related guidelines.
In our opinion, the CLMU management has complied with the above requirements for the year
ended 31 December 2021.
“BDO Arm enia” CJSC
10 June 2022
5
Em ergency Support for M S M E s Project
ID A Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Statement of cash receipts and payments
For the year ended 31 December 2021
(Amounts are show n in U S dollars)
Note Actual Budget Variance
Year ended Cum ulative as at Cum ulative as at Cum ulative as at 31
31 Dec 2021 31 Dec 2021 31 Dec 2021 Dec 2021
Total Opening Cash and Cash Equivalents - -
SOURCES OF FUNDS 8
IDA Credit No.6758-KG 3,000,000 3,000,000
IDA Grant No.D706-KG 4,153,570 4,153,570
AIIB Loan No.L0423A 3,000,000 3,000,000
TOTAL FUNDS 10,153,570 10,153,570
PROJECT EXPENDITURES 7
IDA Credit and Grant 148,374 148,374 12,448,220 12,299,846
(1) Reimbursable Financial Assistance concessional payments under Part 1 87,780 87,780 3,027,333 2,939,553
(2) Capitalization of PRSF under Part 2.1 9,002,585 9,002,585
(3) Goods, Non-consulting Services, Consulting Services, Training and
'
Operating Costs, under Parts 2.2 and 3, and commission fee for SDAs under
Part 3 60,594 60,594 418,302 357,708
AIIB Loan - - - -
(1) RFA payments under Component 1 - - - -
(2) Capitalization of PRSF under Component 2 - - - -
(3) Commission Fee for SDAs under Component 3 - - - -
(4) Front-end Fee - - - _
(5) Interest under the Loan - - - -
TOTAL PROJECT EXPENDITURES 148,374 148,374 12,448,220 12,299,846
Foreign currency,•gainTHoss) л 5 5
Total Closi п я м а ф an^LCash dEquivalents 6 1 0 ,0 (^ 2 0 1 „ 1.0,005,201
ш
/ /7 /)/? л jL
Musakoznoeva Bermet Davlesova Me hr/ban
Director of CLMU Financial Manager of CLMU
10 June 2022
The notes on pages 8-18 form an integral part of these special purpose financial statements.
6
Em ergency Support for M S M E s Project
ID A Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Statement of expenditures per components
For the year ended 31 Decem ber 2021
(Amounts are shown in U S dollars)__________
Actual Planned Variance
Year ended 31 Cumulative as Cum ulative as Cum ulative as at
Com ponents
Dec 2021 at 31 Dec 2021 at 31 Dec 2021 31 Dec 2021
Part 1. Reimbursable Financial Assistance (RFA) for MSMEs 87,780 87,780 3,027,333 2,939,553
Part 2. Portfolio Risk Sharing Facility (PRSF) - - 9,002,585 9,002,585
2.1. Capitalization of PRSF to provide Portfolio Partial Credit Guaranties to PFIs for
credits to MSMEs - - 8,294,650 8,294,650
2.2. Provision of technical assistance to support for operationalization of the PRSF - - 707,935 707,935
Part 3. Project implementation, coordination and management 60,594 60,594 418,302 357,708
Front-end fee - - - -
Interest under the Loan - - - -
TOTAL 148,374 148,374 12,448,220 12,299,846
МЪ1/
Musakozhoeva Bermet
Director of CLMU
10 June 2022
The notes on pages 8-18 form an integral part of these special purpose financial statements.
7
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, ID A Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are show n in U S dollars)
1. General information
1.1. The Project
The Financing Agreement was concluded on 2 September 2020 between the Kyrgyz Republic and the
International Development Association (“IDA” or “W B”), according to which IDA provided the Kyrgyz
Republic the Grant IDA Credit No.6758-KG in the amount of 18,300,000 Special Drawing Rights (SDR)
and IDA Grant No.D706-KG in the amount of 18,300,000 SDR.
The payment currency of the financing is United States dollars (USD).
The financing was provided for the implementation of «Emergency Support for MSMEs Project» (the
Project).
The Project became effective on 31 March 2021.
The Closing date of financing under IDA Credit No.6758-KG and IDA Grant No.D706-KG is 31 July
2024.
The Grace Period for submitting withdrawal application for expenditures incurred before the Closing
date is four months following the Closing dates: 30 November 2024.
The Loan Agreement was concluded on 2 September 2020 between the Kyrgyz Republic and the
Asian Infrastructure Investment Bank (“A IIB”), according to which AIIB provided the Kyrgyz Republic
the Loan No.L0423A in the amount of 50,000,000 USD, as co-financing to the Project.
The Closing date of financing under AIIB Loan No.L0423A is 31 July 2024.
1.2. The Project objectives
The objective of the Project is to support micro, small and medium enterprises (MSMEs) in response
to and during the recovery from COVID-19 crisis.
The Project consists of the following parts:
Part 1: Reimbursement Financial Assistance for MSMEs
Provision of Reimbursable Financial Assistance (RFA) through Selected Disbursement Administrators
(SDAs) for sub=projects to cover operational expenses for MSMEs in order to: (a) prevent closures
and the disruption of firms, (b) preserve private sector employment and (c) accelerate economic
recovery.
Part 2. Portfolio Risk Sharing Facility (PRSF)
Provision of support to reduce the risk of financial sector withdrawal from lending to MSMEs during
COVID-19 crisis and to ensure credit provision during to MSMEs during the recovery, through:
2.1. Capitalization of the PRSF to provide Portfolio Partial Credit Guaranties (PPCG) to Participating
Financial Institutions (PFIs) for credits to MSMEs on a portfolio basis or on a individual loan basis;
2.2. Provision of technical assistance to support the operationalization of the PRSF.
Part 3. Project implementation, coordination and Management
1.3. Project Implementation
The Credit Line Management Unit under the Ministry of Finance of the Kyrgyz Republic (“CLMU”) is
responsible for the Project’s implementation.
The CLMU address is: office N302, Erkindik Blvd. 58A, Bishkek, Kyrgyz Republic, 720040.
Em ergency Support for M S M E s Project
ID A Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
N otes to the special purpose financial statem ents
For the year ended 31 Decem ber 2021
(Amounts are shown in U S dollars)
1.4. The Project Budget and Financing
The Project is wholly financed, inclusive of taxes, by IDA Credit No.6758-KG, IDA Grant No.D706-KG, and AIIB Loan No.L0423A.
Category IDA Credit No.6758-KG IDA Grant No.D706-KG AIIB Loan Total
NO.L0423A
SDR USD equivalent SDR USD equivalent USD USD equivalent
(a) (a)
(1) Reimbursable Financial Assistance
9,882,000 13,848,402 15,738,000 22,084,937 36,700,000 72,633,339
concessional payments under Part 1
(2) Capitalization of PRSF under Part 2.1 8,418,000 11,796,787 - - 12,200,000 23,996,787
(3) Goods, Non-consulting Services,
Consulting Services, Training and
- - 2,562,000 3,595,222 500,000 4,095,222
Operating Costs, under Parts 2.2 and 3,
and commission fee for SDAs under Part 3
(4) Front-end fee - - - - 125,000 125,000
(5) Interest under the Loan - - - - 475,000 475,000
Total 18,300,000 25,645,189 18,300,000 25,680,159 50,000,000 101,325,348
(a) The budget USD equivalents for IDA Credit No.6758-KG and IDA Grant No.D706-KG with underling currency of SDR, is calculated based on cumulative funds
received in USD plus, if any, USD equivalent of undisbursed funds in SDR as at reporting date. SDR/USD rate as at 31.12.2021 is set at 1.39959.
9
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 Decem ber 2021
(Amounts are show n in U S dollars)
2. Summary of significant accounting policies
2 . 1. Preparation and presentation of financial statements
The special purpose financial statements are prepared in accordance with the International Public
Sector Accounting Standard: Financial Reporting Under the Cash Basis of Accounting (IPSAS-Cash
Basis), issued by the International Public Sector Accounting Standards Board (IPSASB), and presented
in accordance with Financial Management Manual for World Bank Financed Investment Operations
(March 2010): RM 3 - Financial Reporting and Auditing.
The principal accounting policies applied in the preparation of these special purpose financial
statements are set out below. These policies have been consistently applied to all the periods
presented.
2.2 Cash basis of accounting
Project financing is recognised as a source of project funds when the cash is received. Project
expenditures are recognised as a use of project funds when the payments are made.
2.3 Reporting currency
The reporting currency of these special purpose financial statements is United States dollars (USD).
The expenditures made in local currency, Kyrgyz Som (KGS), are translated into USD based at the
exchange rate prevailing at the date of the transaction.
The exchange rate defined by the operating bank is as follows:
31 December 2021: USD 1 = 82.50 KGS.
2.4. Taxes
The taxes are paid in accordance with the tax regulation of the Kyrgyz Republic.
2.5. Budget
Expenditure budget is created based on actual accumulated expenditures for the last period plus
the updated procurement plans for the Reporting year.
10
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 Decem ber 2021
(Amounts are show n in U S dollars)
3. Summary of Summary Reports and SOEs
3.1.IDA Credit No.6758-KG
There were no SOE approved as at reporting date onIDA Credit No.6758-KG. The reimbursement
relates to advance provided (Note 8.1).
3.2. IDA Grant No.D706-KG
There were no SOE approved as at reporting date onIDA Grant No.D706-KG. The reimbursement
relates to advance provided (Note 8.2).
3.3. AIIB Loan No.L0423A
There were no SOE approved as at reporting date on AIIB No.L0423A. The reimbursement relates to
advance provided (Note 8.3).
4. Statement of Designated Accounts
4.1. IDA CreditNo.6758-KG
Designated account numbers 1350108036468622 1350108039770662
Bank CJSC “Ayil Bank”
Bank location Bishkek, Kyrgyz Republic
Account currency USD
Designated Designated Total
Account- RFA Account -
(IDA Credit) PRSF
1. Opening balance - - -
2. Add: opening discrepancy - - -
3. IDA advance/replenishment - 3,000,000 3,000,000
4. Less: Refund to IDA from DA - - -
5. Present outstanding amount advanced to DA . 3,000,000 3,000,000
6. DA closing balance - 403,211 403,211
- -
7. Add: Amount of eligible expenditures paid -
8. Less: interest earned (if credited to DA) - - -
9. Total advance accounted for _ 403,211 403,211
10. Closing discrepancy (5)-(9)* - 2,596,789 2,596,789
[*) The discrepancy is due to:
Designated Designated Total
Account-RFA Account - PRSF
(IDA Credit)
Amounts paid to PFIs but not yet claimed
- 2,596,789 2,596,789
(Note 6)
2,596,789 2,596,789
11
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are show n in U S dollars)
4.2. IDA Grant No.D706-KG
Designated account numbers 350108031283364 1350108036421031
Bank CJSC “Ayil Bank”
Bank location Bishkek, Kyrgyz Republic
Account currency USD
Designated Designated Total
Account Account - RFA
1. Opening balance
2. Add: opening discrepancy
3. IDA advance/replenishment 250,000 3,903,570 4,153,570
4. Less: Refund to IDA from DA
5. Present outstanding amount advanced to DA 250,000 3,903,570 4,153,570
6. DA closing balance 189,406 1,835,003 2,024,409
7. Add: Amount of eligible expenditures paid 60,594 87,780 148,374
8. Less: interest earned (if credited to DA)
9. Total advance accounted for 250,000 1,922,783 2,172,783
10. Closing discrepancy (5)-(9)* 1,980,787 1,980,787
(*) The discrepancy is due to:
Designated Designated Total
Account Account - RFA
RFA Transit account (Note 6) 1,980,792 1,980,792
FX (gain)/loss (5) (5)
1,980,787 1,980,787
4.3. AIIB Loan No.L0423A
Designated account numbers 1350108035009174
Bank CJSC “Ayil Bank”
Bank location Bishkek, Kyrgyz Republic
Account currency USD
Designated Designated Total
Account Account - PRSF
1. Opening balance - - -
2. Add: opening discrepancy - - -
3. IDA advance/replenishment - 3,000,000 3,000,000
4. Less: Refund to IDA from DA - - -
5. Present outstanding amount advanced to DA - 3,000,000 3,000,000
6. DA closing balance - 403,211 403,211
7. Add: Amount of eligible expenditures paid - - -
8. Less: interest earned (if credited to DA) - - -
9. Total advance accounted for - 403,211 403,211
10. Closing discrepancy (5)-(9)* - 2,596,789 2,596,789
(*) The discrepancy is due to:
Designated Designated Total
Account Account - PRSF
Amounts paid to PFIs but not yet claimed (Note 6) - 2,596,789 2,596,789
- 2,596,789 2,596,789
12
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, ID A Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are show n in U S dollars)
5. Statement of Financial Position
The Statement of Financial Position discloses assets, liabilities and net assets of the Projects as at
reporting date. It is prepared in accrual basis that is transactions are recognized when they occur
(and not only when cash is received or paid).
Note 31 Dec 2021
USD
ASSETS
Cash and cash equivalents 6 10,005,201
Prepayments _____________
Total assets 10,005,201
LIABILITIES
Payables ___________
Total liabilities
NET ASSETS
Cumulative income 8
IDA Credit No.6758-KG 3,000,000
IDA Grant No.D706-KG 4,153,570
AIIB Loan No.L0423A 3,000,000
10,253,000
Cumulative expenses
Project expenses 7 148,374
148,374
Foreign exchange gain/(loss) 5
Total net assets 10,005,201
13
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are shown in U S dollars)
6. Cash and cash equivalents
Underlying 31 Dec 2021
Currency USD
IDA Credit No.6758-KG
Designated Account USD
Designated Account - PRSF USD 403,211
Amounts paid to PFIs but not yet claimed (a) KGS 2,596,789
3,000,000
IDA Grant NO.D706-KG
Designated Account USD 189,406
Designated Account - RFA USD 1,835,003
Transit Account -RFA (b) KGS 1,980,792
4,005,201
AIIB Loan NO.L0423A
Designated Account USD
Designated Account -PRSF Account USD 403,211
Amounts paid to PFIs but not yet claimed (a) KGS 2,596,789
3,000,000
Total cash and equivalent 10,005,201
(a) Breakdown of amounts paid to PFIs but not yet claimed
Participating Financiallnstitution (PFIs) Underlying 31 Dec 2021
________________________________________________________ Currency ______ USD*
RSK Bank (Bishkek, Kyrgyz Republic) KGS 1,770,538
Bakai Bank (Bishkek, Kyrgyz Republic) KGS 1,652,503
Bank of Asia (Bishkek, Kyrgyz Republic) KGS_______ _______1,770,538
Total 5,193,579
(*) The amounts are provided at the exchange rate prevailing at the date of transaction, USD 1 =
KGS 84.72, which is not revaluated at the year end, because the KGS is economic substance of such
balances as the contractual relationships with PFIs are in KGS.
(b) Transit accounts of IDA Grant No.D706-KG are opened to make payments on RFAs, to transfer
money to SDAs, to pay local suppliers and consultants, and to execute the Project’s other
expenditures in the local currency. Transit accounts’ balances are not revalued at year end, but
expenditures made through it are translated applying rate of conversion applied. KGS provides the
contractual relationships with SDAs and economic substance of such balances.
14
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, ID A Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are show n in U S dollars)
7. Project Expenditures Budget Execution
Cumulative
Expenditures Total budget,
as at 31 Dec 2021 updated Progress (a)
Category USD USD %
(1) Reimbursable Financial Assistance
87,780 72,633,339 0.1
concessional payments under Part 1
(2) Capitalization of PRSF under Part 2.1 - 23,996,787 -
(3) Goods, Non-consulting Services,
Consulting Services, Training and
60,594 4,095,222 1.5
Operating Costs, under Parts 2.2 and 3,
and commission fee for SDAs under Part 3
(4) Front-end fee - 125,000 -
(5) Interest under the Loan - 475,000 -
1 4 8 ,3 7 4 1 0 1 ,3 2 5 ,3 4 8 0.1
T o tal
(a) Project became effective 31 March 2021. As of 31 Dec 2021, 0.1% of the total expenditures are
implemented. The slow progress of the project is due to need to perform preparatory procedures
and other matters as described below.
'A Need to prepare and approve the RFA manual, negotiate and sign agreements with SDAs,
resulting in delays in the uses of funds. SDAs began finance beneficiaries in the 4th quarter of
2021, but they faced with the small demand of RFA and in this connection MoF and the Bank
decided to amend eligibility criteria, list of eligible expenditures and amounts of RFA. This
activity was expected to be completed during the first half of 2022 and starting from March
2022 RFA started to be paid to beneficiaries more actively and quickly.
A Need to prepare and approve the PRSF manual. GF negotiated and signed agreements with PFIs,
after that the funds were deposited in PFIS but not used for guarantees yet.
15
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are shown in U S dollars)
8. Financing
8.1. IDA Credit No.6758-KG
Cumulative as
2021 at 31 Dec 2021
USD USD
Advance 3,000,000 3,000,000
SOE and Summary Report - -
Total 3,000,000 3,000,000
Total financing budget (Note 1.4) 25,645,189
Percentage of finance provided as at 31 Dec 2021 12%
8.2. IDA Grant No.D706-KG
Cumulative as
2021 at 31 Dec 2021
USD USD
Advance 4,153,570 4,153,570
SOE and Summary Report - -
Total 4,153,570 4,153,570
Total financing budget (Note 1.4) 25,680,159
Percentage of finance provided as at 31 Dec 2021 16%
8.3. AIIB Loan No.L0423A
Cumulative as
2021 at 31 Dec 2021
USD USD
Advance 3,000,000 3,000,000
SOE and Summary Report
Total 3,000,000 3,000,000
Total financing budget (Note 1.4) 50,000,000
Percentage of finance provided as at 31 Dec 2021 6%
16
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, ID A Grant NO.D706-KG, A IIB Loan No.L0423A
Notes to the special purpose financial statem ents
For the year ended 31 December 2021
(Amounts are shown in U S dollars)
9. Events after reporting date
Military conflict between Russian Federation and Republic of Ukraine
On February 24, 2022, Russia launched a large-scale military operations against Ukraine. In order to
resist Russia, the EU and the United States, and other countries around the world, have imposed
economic and political sanctions, as a result of which the Russian economy is facing significant
issues. At present, the course of the war, the impact of sanctions, and the extent of the
consequences are unpredictable.
Taking into consideration of Russia's political and economic influence on the Kyrgyz Republic, as
well as the fact that country is a member of the Russia lead Eurasian Economic Union (EEU), the
current situation may indirectly affect the stability of Kyrgyz Republic's financial and economic
systems.
At the moment, given the unpredictability of these circumstances, the Project management finds it
difficult to assess the potential impact on the Project implementation.
10. Litigations
There are no pending litigations related to the Project as at reporting date and as at approval date
of these special purpose financial statements.
17
Em ergency Support for M S M E s Project
IDA Credit No.6758-KG, IDA Grant No.D706-KG, A IIB Loan NO.L0423A
ANNEX 1. RECONCILIATION BETWEEN THE AMOUNTS SUBMITTED BY THE CLMU AND
DISBURSED BY THE WORLD BANK
For the year ended 31 D ecem ber 2021
(Amounts are shown in U S dollars)_______________
IDA Credit No.6758-KG
Expenditure Category Appl. CLMU WB Difference
CR-
PRSF-1
3,000,000.00 3,000,000.00 -
Advance
3,000,000.00 3,000,000.00
3,000,000.00 3,000,000.00
IDA Grant NO.D706-KG
Expenditure Category Appl. CLMU WB Difference
G-1 250,000.00 250,000.00 -
G-RFA-
Advance 3,903,570.00 3,903,570.00 -
1-1
4,153,570.00 4,153,570.00
4,153,570.00 4,153,570.00
AIIB Loan NO.L0423A
Expenditure Category Appl. CLMU WB Difference
AIIB-
3,000,000.00 3,000,000.00 -
Advance PRSF-1
3,000,000.00 3,000,000.00
3,000,000.00 3,000,000.00