THE UNITED REPUBLIC OF TANZANIA 0 NATIONAL AUDIT OFFICE REPORT OF THE CONTROLLER AND AUDITOR GENERAL ON THE FINANCIAL STATEMENTS AND COMPLIANCE AUDIT OF THE MINISTRY OF HEALTH, COMMUNITY DEVELOPMENT, GENDER, ELDERLY AND CHILDREN FOR THE TANZANIA COVID - 19 PANDEMIC EMERGENCY FINANCING FACILITY PROJECT FOR THE PERIOD ENDED 31 MARCH, 2021 Controller and Auditor General, National Audit Office, Audit House, 4 Ukaguzi Road, P.O. Box 950, 41101 Tambukareli, Dodoma, Tanzania. Tel: 255 (026) 2161200, Fax: 255 (026) 2117527, E-mail: ocag@nao.go.tz Website: www.nao.qo.tz December, 2021 AR/COVID-19 PEF NOTE 52/2021 Mandate The statutory mandate and responsibilities of the Controller and Auditor-General are provided for under Article 143 of the Constitution of the URT of 1977 (as amended from time to time) and in Section 10 (1) of the Public Audit Act, 2008. Vision A credible and modern Supreme Audit Institution with high-quality audit services for enhancing public confidence. Mission To provide high-quality audit services through modernization of functions that enhances accountability and transparency in the management of public resources. Motto: "Modernizing External Audit for Stronger Public Confidence" Core values in providing quality services, NAO is guided by the following Core Values: i. Independence and objectivity ii. Professional competence iii. Integrity iv. Creativity and Innovation v. Results-Oriented vi. Teamwork Spirit We do this by: " Contributing to better stewardship of public funds by ensuring that my clients are accountable for the resources entrusted to them; / Helping to improve the quality of public services by supporting innovation on the use of public resources; V Providing technical advice to our clients on operational gaps in their operating systems; / Systematically involve our clients in the audit process and audit cycles; and V Providing audit staff with adequate working tools and facilities that promote independence. @ This audit report is intended to be used by MOHCDGEC COVID-19 PEF and may form part of the annual general report, which once tabled to National Assembly, becomes a public document; hence, its distribution may not be limited. Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 TABLE OF CONTENTS Abbreviations..................................................................................... iv 1.0 INDEPENDENT REPORT OF THE CONTROLLER AND AUDITOR GENERAL......... 1 1.1 REPORT ON THE AUDIT OF FINANCIAL STATEMENTS.............................1 1.2 REPORT ON COMPLIANCE WITH LEGISLATIONS...................................4 2.0 FINANCIAL STATEMENTS ................................................................. 1 iii Controller and Auditor General AR/ COVID-19 PEF VOTE 52/2021 Abbreviations ACPA Associate Certified Public Accountant CAG Controller and Auditor General COVID Corona Virus Disease 2019 D-Funds Direct to project funds EIA Environmental Impact Assessment FY Financial year ICT Information Communication Technology IDA International Development Association ISSAIs International Standard of Supreme Audit Institutions IPSAS International Public Sector Accounting Standards MOHCDGEC Ministry of Health, Community Development, Gender, Elderly and Children NBAA National Board of Accountants and Auditors NPHL National Public Health Laboratory PEF Pandemic Emergency Financing Facility PAA Public Audit Act No.11 of 2008 PPA Public Procurement Act, 201 1 (as-amended in 2016) SARS-CoV-2 Severe Acute Respiratory Syndrome Coronavirus 2 USD United States Dollar TF Trust Fund TZS Tanzania Shillings Iv Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 1.0 INDEPENDENT REPORT OF THE CONTROLLER AND AUDITOR GENERAL Accounting Officer, Ministry Health, Community Development, Gender, Elderly and Children, Government City-Mtumba, P. 0. Box 748, 40478 DODOMA. 1.1 REPORT ON THE AUDIT OF FINANCIAL STATEMENTS Opinion I have audited the financial statements of MOHCDGEC COVID-19 PEF whose operations were implemented for six months from 22 September 2020 to 31 March 2021 comprising of the statement of financial position, and the statement of financial performance, statement of changes in net assets and cash flow statement and the statement of comparison of budget and actual amounts for the period then ended, as well as the notes to the financial statements, including a summary of significant accounting policies. In my opinion, the accompanying financial statements present fairly in all material respects, the financial position of MOHCDGEC COVID-19 PEF as at 31 March 2021 and its financial performance and its cash flows for the year then ended in accordance with International Public Sector Accounting Standards (IPSAS) Accrual basis of accounting and the manner required by the Public Finance Act, Cap. 348 [R.E 2020]. Basis for Opinion I conducted my audit in accordance with the International Standards of Supreme Audit Institutions (ISSAIs). My responsibilities under those standards are further described in the Auditor's Responsibilities for the audit of the financial statements section of my report. I am independent of MOHCDGEC COVID-19 PEF in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA Code) together with the National Board of Accountants and Auditors (NBAA) Code of Ethics, and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key Audit Matters Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of financial statements as a whole and in 1 Controller and Auditor General AR/ COVID- 19 PEF /VOTE 52/2021 forming my opinion thereon, and I do not provide a separate opinion on these matters. There is nothing to report on this matter. Other Information Management is responsible for the other information. The other information comprises the Statement of Management Responsibility and the Declaration by the Head of Finance but does not include the financial statements and my audit report thereon. My opinion on the financial statements does not cover the other information, and I do not express any form of assurance conclusion thereon, In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work I have performed on the other information that I obtained prior to the date of this audit report, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard. Responsibilities of Management and those charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with IPSAS and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the entity's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the entity or to cease operations or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the entity's financial reporting process. Responsibilities of the Controller and Auditor General for the Audit of the Financial Statements My objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error and to issue an audit report that includes my opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance 2 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 with ISSAIs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with ISSAIs, I exercise professional judgment and maintain professional skepticism throughout the audit. I also: * Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. 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 entity's internal control. * Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. * Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the entity's ability to continue as a going concern. If I conclude that a material uncertainty exists, I are required to draw attention in my audit report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my audit report. However, future events or conditions may cause the entity to cease to continue as a going concern. * Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit. I also provide those charged with governance with a statement that I have complied with relevant ethical requirements regarding independence and to communicate with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards. 3 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 From the matters communicated with those charged with governance, I determine those matters that were of most significance in the audit of the financial statements of the current period and are, therefore, the key audit matters. I describe these matters in my audit report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. In addition, Section 10 (2) of the Public Audit Act, Cap.418 [R.E 2021] requires me to satisfy myself that the accounts have been prepared in accordance with the appropriate accounting standards. Further, Section 48(3) of the Public Procurement Act, 2011 requires me to state in my annual audit report whether or not the audited entity has complied with the procedures prescribed in the Procurement Act and its Regulations. 1.2 REPORT ON COMPLIANCE WITH LEGISLATIONS Compliance with the Public Procurement Act, 2011 (as amended by the Public Procurement (Amendment) Act, 2016) Subject matter: Compliance Audit on Procurement of Works, Goods and Services I performed a compliance audit on procurement of works, goods and services in the MOHCDGEC COVID - 19 PEF for the six months project period starting from 22 September 2020 to 28 February 2021 as per the Public Procurement Act, 2011 and its regulation of 2013 (as amended by the Public Procurement (Amendment) Act, 2016). Conclusion Based on the audit work performed, I state that, except for the matters described below, procurement of goods, works and services of MOHCDGEC COVID-19 PEF is generally in compliance with the requirements of the Public Procurement Act, 2011 and its regulations of 2013 (as amended by the Public Procurement (Amendment) Act, 2016). 1. Advance payment bank guarantee not confirmed TZS 3,047,708,373.61 During auditing I noted that suppliers for three contracts worth TZS 3,047,708,373.61 claimed advance payment and submitted bank guarantees as required. However Management of Ministry did not perform due diligence to confirm if the guarantees have been signed and approved by proper personnel to authenticate its validity and legality to mitigate loss should any non-performance of the contract occur. 4 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 2. Bank Guarantee not extended for time extension provided by the client Review of contract files noted that, MOHCDGEC extended projects completion periods without requesting extension period of performance security to cover for the extended project completion dates contrary to the requirement of Reg.192(1) of Public Procurement Regulations, 2013. Benjamin M. auri Ag. Controller and Auditor General Dodoma, United Republic of Tanzania 31 December, 2021 5 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 2.0 FINANCIAL STATEMENTS STATEMENT BY THE PERMANENT SECRETARY FOR THE PERIOD ENDED 31 MARCH 2021 1. Introduction The objective of the project is to strengthen capacity for laboratory diagnosis and management of COVID - 19 cases. Financing The project is financed under the Pandemic Emergency Financing Facility (PEF) under the trust ship and coordination of the World Bank. The Grant Agreement between The Government and the World Bank was signed on 22nd September, 2020; for the period of 4 months to 31 January 2021. The Project was extended for one month to 28th February, 2021 and the deadline for payment was 31st March, 2021. For the period of 22nd September, 2020 to 31st March, 2021, the Project received the whole grant amount of USD 3,787,433.00 (equivalent to TZS 8,659,990,189.94). Project components: Component 1: Strengthening Laboratory Diagnosis Capacity: Improving the operations capacity of the National Public Health Laboratory to ensure it is fully functional and capable of processing at least five hundred (500) SARS-CoV-2 tests a day, through the provision of equipment, medical supplies and reagents for testing COVID-19 specimens. Component 2: Improving Management of COVID - 19 Cases: Through procurement and installation of medical oxygen plants supply systemsat seven (7) regional referral hospitals including provision of medical oxygen cylinders; procurement of essential medicines and supplies for highly infectious disease treatment units throughout the country and strengthening the capacity of biomedical technicians, nurses and laboratory staff through the provision of specialized training on production and management of oxygen plants, proper administration of oxygen gas to patients and the diagnosis of SARS-CoV-2 infection. Component 3: Implementation Management and Monitoring and Evaluation: Strengthening the institutional capacity to manage and coordinate the project in areas of financial management, procurement, social and environmental management, monitoring and evaluation of project activities, stakeholder engagement and project reporting. 6 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 STATEMENT BY THE PERMANENT SECRETARY FOR THE PERIOD ENDED 31 MARCH 2021 2. Project implementation during the period of 22nd September, 2020 to 31st March, 2021 The amount budgeted to be spent during the period was TZS 8,664,686,615.52. The Project received TZS 8,659,990,189.94 from the World Bank and spent TZS 8,644,111,103.05. During the period the following activities were implemented: 2.1 Procurement and installation of medical oxygen plants; medical oxygen supply systems and medical oxygen cylinders at Seven Regional Referral Hospitals: The plants and oxygen supply system has been procured and installed at Amana, Manyara, Geita, Mbeya, Mtwara, Ruvuma and Dodoma regional referral hospitals. A total of TZS 5,375,048,845.61 has been spent. This include: - Oxygen plants -TZS 4,154,998,538.38 - Manifold system (Medical Oxygen Supply System) - TZS 887,049,765.91 - Oxygen cylinders - TZS 333,000,541.32 2.2 Procurement of essential medicines and supplies for highly infectious disease treatment units: Through Medical Stores Department, the project has procured and distributed essential medicines and supplies amounting to TZS 820,186,936.44 to health facilities in Zanzibar and Tanzania Mainland. 2.3 Procurement of laboratory equipment and reagents for use at the National Public Health Laboratory: The Project has procured laboratory equipment and reagents for use at the National Public Health Laboratory. A total of TZS 2,073,774,489.69 has been spent as follows: " Laboratory equipment - TZS 1,267,775,709.61 * Reagents - TZS 805,998,780.08 7 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 STATEMENT BY THE PERMANENT SECRETARY FOR THE PERIOD ENDED 31ST MARCH 2021 2.4 Training of medical staff on the management of COVID-19 cases: The Project has conducted training sessions to laboratory staff from the National Public Health Laboratory on molecular diagnosis of severe upper respiratory infectious agents and to biomedical engineers, technicians, nurses and doctors from seven regional referral hospitals on the use and maintenance of medical oxygen plants and manifold system. 2.5 EIA and procurement of ICT equipment to facilitate coordination of project activities: As a pre-requisite for the installation of medical oxygen plants, the Project conducted Environmental Impact Assessment (EIA) to seven regional referral hospitals' in Amana, Manyara, Geita, Mbeya, Mtwara, Ruvuma and Dodoma. The Project also procured ICT equipment to facilities smooth coordination of the project activities. 3. Closure of the Project The Tanzania COVID - 19 Pandemic Emergency Financing Facility Project was a short term grant, commenced on 22nd September, 2020 and closed on 28th February, 2021. The deadline for payments was 31st March, 2021. The Ministry has successfully managed to implement the planned activities and achieved the agreed targets. Accounting Officer Date: 8 controller and Auditor General AR/ COVID-19 PEF NVOTE 52/2021 STATEMENT OF MANAGEMENT RESPONSIBILITY FOR THE PERIOD ENDED 31 MARCH, 2021 Section 25(4) of the Public Finance Act No. 6 of 2001 as amended in 2004 requires the Management to prepare financial statements for each financial year, which give a true and fair view of state of affairs of the reporting entity, as at the end of the financial year. It also requires Management to ensure the reporting entity keeps proper accounting records, which disclose with reasonable accuracy at any time the financial position of the reporting entity. They are also responsible for safeguarding the assets of the reporting entity. The Management accepts the responsibility for the annual financial statements, which have been prepared using appropriate accounting policies, supported by reasonable and prudent judgments and estimates, in conformity with the accrual basis of accounting under the International Public Sector Accounting Standards (IPSAS) and in the manner required by Section 25(4) of the Public Finance Act No. 6 of 2001 as amended in 2004. The Management further accepts the responsibility for the maintenance of accounting records that may be relied upon in the preparation of financial statements as well as putting in place sound systems of internal financial control. The Management is also responsible for safeguarding the assets of the reporting entity and hence, taking reasonable steps for the prevention and detection of fraud, error and other irregularities. To the best of our knowledge, the system of internal control has operated adequately, throughout the reporting period, and that, the records and underlying accounts provide a reasonable basis for the preparation of the financial statements for the period ended 31st March, 2021. We therefore accept the responsibility for the integrity of the financial statements, the information it contains and its compliance with the Public Finance Act No. 6 of 2001, as amended in 2004 and as per instructions from the Treasury. Procurement of goods, works, consultancy, and non-consultancy services to the extent that they are reflected in these financial statements was made in accordance with the Public Procurement Act No. 7 of 2011 and its regulation of 2013, as amended in 2016. 9 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 The Tanzania COVID-19 Pandemic Emergency Financing Facility Project under the Ministry of Health Community Development, Gender, Elderly and Children was closed on 28th February, 2021 and the deadline for payment was 31st March, 2021. Accounting Officer Date: :TL 10 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 DECLARATION OF THE HEAD OF FINANCE/ACCOUNTING FOR THE PERIOD ENDED 31 MARCH 2021 The National Board of Accountants and Auditors (NBAA) according to the power conferred under the Auditors and Accountants (Registration) Act. No. 33 of 1972, as amended by Act No. 2 of 1995, requires financial statements to be accompanied with a declaration issued by the Head of Finance/Accounting responsible for the preparation of financial statements of the entity concerned. It is the duty of a Professional Accountant to assist the Management to discharge the responsibility of preparing financial statements of an entity showing true and fair view of the entity's financial position and financial performance in accordance with applicable International Accounting Standards and statutory financial reporting requirements. Full legal responsibility for the preparation of financial statements rests with the Management as under Management Responsibility statement on an earlier page. I Daniel John Mhando being Accountant Incharge of the Projects under the Ministry of Health, Community Development, Gender, Elderly and the Children hereby acknowledge my responsibility of ensuring that financial statements for the period ended 31 March, 2021 have been prepared in compliance with applicable accounting standards and statutory requirements. I thus confirm that the financial statements give a true and fair view of state of affairs of the Tanzania COVID-19 Pandemic Emergency Financing Facility Project being managed by the Ministry of Health, Community Development, Gender, Elderly and Children (Vote 52) as on that date and that they have been prepared based on properly maintained financial records. Signed by: CPA Daniel John Mhando Position: Accountant NBAA Membership No. ACPA 3340 Date: 11 Controller and Auditor General AR/ COVID-19 PEF /VOTE 52/2021 COMMENTARY ON THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH 2021 1. Introduction The objective of the project is to strengthern capacity for laboratory diagnosis and management of COVID - 19 cases. The Project was closed on 28 February, 2021 and the deadline for the payment was 31 March, 2021. 2. Scope of the financial statements The financial statements present the results of operations of the Tanzania COVID- 19 Pandemic Emergency Financing Facility Project for the period of 22 September, 2020 to 31 March, 2021. 3. Financial Performance During the period ended 31 March, 2021, the project received by way of direct to project funds (D-Funds) a total of TZS 8,659,990,189.94 (USD 3,787,433.00) from the World Bank. The payments made during the period were TZS 8,644,111,103.05 4. Personnel emoluments The project was mainstreamed within the Ministry and implemented by Government employees. Hence, no personel emoluments were piad. 5. Transfers During the period, the Project made a transfer of TZS 820,186,936.44 to Medical Stores Department to procure and distribute essential medicines and supplies to health facilities in Zanzibar and Tanzania Mainland. To close Project books of accounts, the assets worth TZS 6,751,359,114.41 were internally transferred to the Ministry. The assets transferred include medical oxygen plants, manifold system, oxygen cylinders, laboratory equipment, office furniture and ICT equipment. 6. Purchase of Property, Plant and Equipment During the period ended 31st March, 2021, the project incurred expenditure amounting to TZS 6,751,359,114.41 for Property, Plant and Equipment, of which: * TZS 5,375,048,845.61 spent on procurement and installation of medical oxygen plants; manifold supply system and oxygen cylinders in Amana, Manyara, Geita, Mbeya, Mtwara, Ruvuma and Dodoma regional referral hospitals. 12 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 COMMENTARY ON THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH 2021 * TZS 1,267,775,709.61 spent on procurement of laboratory equipment for use at the National Public Health Laboratory * TZS 108,534,559.20 used to procure ICT and office equipment and office furnitures for use at the Ministry to facilitate coordination of project activities. The aforementioned assets have been internally transferred to the Ministry. 7. Outstanding liabilities at the end of the period The Project has paid all eligible claims on signed contracts and closed with no outstanding liabilities. 8. Exchange loss The Project incurred an exchange loss of TZS 15,462,318.85 from translation of transactions denominated in USD into TZS for Financial Statements presentation. 9. Auditors The Controller and Auditor General of the United Republic of Tanzania is the Statutory Auditor of the project pursuant to the provisions of Article 143 of the Constitution of the United Republic of Tanzania of 1977 (revised 2005), Sections 26 - 37 of the Public Finance Act No. 6 of 2001 as amended in 2004, the Public Audit Act No. 11 of 2008 and the Project Grant Agreement. Accounting Officer Date: 13 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 STATEMENT OF FINANCIAL PERFORMANCE FOR THE PERIOD ENDED 31 MARCH,2021 (Classification of Expense by Nature) 2020/2021 2019/2020 Note TZS TZS REVENUE Revenue Amortized 15 8,659,990,189.94 TOTAL REVENUE 8,659,990,189.94 EXPENSES AND TRANSFERS Wages, Salaries and Employee 7 Benefits Grants and other Transfer 8 7,571,546,050.85 Payment Supplies and Consumables Used 9 1,066,159,252.40 Routine Maintanance 10 6,405,800.00 Depreciation on PPE 17 Exchange Loss 11 15,462,318.85 TOTAL EXPENSES AND TRANSFERS 8,659,573,422.10 Surplus for the period 416,767.83 Accounting OfficerDte 14 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 STATAMENT OF FINANCIAL POSITION FOR THE PERIOD ENDED 31 MARCH, 2021 2020/2021 2019/2020 Note TZS TZS ASSETS Current Assets Cash and Cash Equivalents 12 416,768.03 - Receivables 13 - - Total Current Assets 416,768.03 - Non - Current Assets Property, Plant and Equipment 17 - - Total Non - Current Assets TOTAL ASSETS 416,768.03 - LIABILITIES Current Liabilities Payables 14 - - Total Current Liabilities Non-Current Liabilities Total Non-Current Liabilities TOTAL LIABILITIES NET ASSETS 416,768.03 - Represented by: Accumulated Surplus 416,768.03 - NET ASSETS 416,768.03 - AV d UngO e; Date: 15 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 CASH FLOW STATEMENT FOR THE PERIOD ENDED 31 MARCH, 2021 (Classification of Expense by Nature) 2020/2021 2019/2020 Note TZS TZS CASH FLOWS FROM OPERATING Actual Cash Receipts Actual Cash Receipts ACTIVITIES /Payments /Payments Receipts Receipts from IDA 6/15 8,659,990,189.94 Payments Wages, Salaries and Employee 7 - Benefits Grants and other Transfer Payment 8 (a) (820,186,936.44) Supplies and Consumables Used 9 (1,066,159,252.40) Routine Maintanance 10 (6,405,800.00) Net cash flows from operating 6,767,238,201.10 activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Property, Plant and 17 (6,751,359,114.41) Equipment Net Cash Flows From Investing (6,751,359,114.41) Activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from Borrowings Repayment of Borrowings Net Cash Flows From Financing Activities Net Increase/(Decrease) in Cash 15,879,086.68 and Cash Equivalents Cash and Cash Equivalents at the Beginning of the Period Effect of exchange rate changes on 11 (15,462,318.85) Cash and Cash Equivalent - Decrease Cash and Cash Equivalents at the 416,767.83 end of the Period Ac Date: 16 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 STATEMENT OF CHANGES IN NET ASSETS FOR THE PERIOD ENDED 31ST MARCH, 2021 Note Accumulated Total Surplus Balance at 1st July, 2019 Surplus for the Period Balance at 30th June, 2020 Carried Forward Balance at 1st July, 2020 Brought Forward Surplus for the Period 416,767.83 416,767.83 Balance at 31st March 2021 416,767.83 416,767.83 Accounting Officer Date: 17 Controller and Auditor General AR/ COVID-19 PEF /VOTE 52/2021 и С О у J � � й � с с а '� оо U ° ,осп b �' а гО И ср W го � > s ° � а о ш г а Н ° о о о '� о Z Г � О � й й � О � � N �^Ч а� � � � N N ,11 � о N N � '�i' т � l7 '.i" р т �О �О м � � 1Л о а Е и о+ о� г� о� ^ �л � а 0 � � � о^о м 1� т iл Z � г� О ш N ш � 3 �`' `� v �r � � о о и 00 и� о� о� �t � О � N и т � о�о о�о м й р � м i? _� � � о� N ао � И Г � а а го о о �о о� �л о� Г а� о• оо и О и � U го � U1 � � � Г � � м _ � 0 о � й й N .�о � й � г� W� а •о .о оо о � � N _ � оо оо � .о `д N Н а � и и n, ш Н w о wa г �� й й � � � °о о й а д а iri ,�j 1� � о м � о• 1 � й .о � rn ото о°о rn �- д � � = b о�Oо `о а�о � � м �р" О о� с_ т 1 .о � � .о n � � � � �` � v ° � "' ^ �° а а' и .о .о оо о n � ь+ а � с оо `O •- •о .�О � о fl °° � ааа ош� а � , n n о v .мо � ^ '0 оо �ri оо о �t l7 т � а` N м м N О� b � � оо" .о I� оо .о '- т с QI О � М W � � � � �i. � о о � Г о �м r', м О г 1� � ао .о г�1 � ао ^ гv и ^ О � а � а b � °i Г � о о � � � а` ° � ш` V г .о оо t� � lL о о � = с '^ � �С � г р и rts � � � ш го а � � n~. � с+�.+Е � с с и � � U И � т � г6 �� V"�О 0' �, и ш � Н � � Z и П! гб � и� Ш с i^ ,ь-л+ � J W а`+ и W '� Q � � Q С С д��ы+ С U д•n h-� } V w ш о а гв �� га а с �•� L о � � а �� Н а �iw C7HйU��aaw Н д NOTES ON THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31ST MARCH, 2021 2020/2021 2019/2020 TZS TZS 6 Receipts Receipts from IDA (Note 15) 8,659,990,189.94 - Total 8,659,990,189.94 7 Wages, salaries and employee benefits Monthly remuneration Total 8 Grants and other transfer payment (a) Cash Transfer Medical Stores Department 820,186,936.44 820,186,936.44 (b) Non Cash Transfer (Capital Grant to other Institutions) - refer Note 18 for Detailed Analysis Internal Transfer to the Ministry 6,751,359,114.41 6,751,359,114.41 Total 7,571,546,050.85 9 Supplies and Consumable used Consuttancy Services 59,500,000.00 Per - Diem Domestic 132,160,000.00 Transport 4,665,000.00 Conference Hall Charges 3,750,000.00 Stationaries 20,479,880.00 Refreshments 18,140,000.32 Diesel 8,744,200.00 Air time 11,200,000.00 Registration fees 1,400,000.00 Reagents 805,998,780.08 Bank Charges 121,392.00 Total 1,066,159,252.40 19 Controller and Auditor General AR/ COVID- 19 PEF NOTE 52/2021 10 Routine maintenance Vehicle maintanance 789,000.00 Minor Office Repair 5,616,800.00 Total 6,405,800.00 11 Effect of exchange rate changes on cash and (15,462,318.85) cash equivalent - decrease Total (15,462,318.85) 12 Cash and cash equivalents Bank Balance in project US$ Account 278,567.45 Bank Balance in project TZS Account - CRDB Bank 138,200.58 Total 416,768.03 13 Receivables 14 Payables 15 Receipts/Revenue Amortized Receipts from IDA Withdrawal Application No. TFOB3767-WA-01 5,832,153,568.94 Withdrawal Application No. TFOB3767-WA-02 2,827,836,621.00 Total 8,659,990,189.94 16 Reconciliation of Net Cash Flows from Operating Activities to Surplus Surplus 416,767.83 20 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 Non-cash movements Transfer of Capital Grant to other Institutions - 6,751,359,114.41 refer to Note 18 for Detailed Analysis Exchange Loss 15,462,318.85 Net cash flows from operating activities 6,767,238,201.10 21 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 � v v v� � +-го� N � �` �` � , г � � М М N й й � � � ш ' � о о с о о N и ` � и й � � � N � г'� r'� � � � i' Х Е- � � и и � �+- м м � .О �О 1 � 1 а"' О О С U � И О О N N '� а Н � оо о0 � � � О � _ ш М М N N � г°� � г� и ш Н О у О О Z � N N LL � О О а а и О О Q` •� � � N N � � � � W рМр рМр � _й о о � 1 �" а С Ш N N Е �ri �ri а и и •� и и Q N � � � � . � ш � cv cv � � i0 и � � � �о .о � � � � с 0, v = Е а � � � м N � '� N й �, О с W о � � � \ Ф � � О L � ` V м � С N � � b � .- у ro _ а а� ш а м 'v' С N � й � N � � а � � 7 � N � U � с аLл v l0 N д � гб с � � 9 � j, .С n. и и (�6 � г6 У И i � � с Ш tJ � 0 о и О ,F, � 01 О � N b N :,=+ и L � � т с � � О �+ � � � .С й � V а м и а а �- ° и а г � 2020/2021 2019/2020 TZS TZS 18 Detailed Disclosure of Assets Transferred to Other Institutions within the Ministry (a) Transfer of Assets to Regional Referral Hospitals in Dodoma, Manyara, Geita, Mbeya, Songea, Mtwara and Amana in Dar es Salaam Medical Oxygen Generating Plants 4,154,998,538.38 Medical Oxygen Supply System 887,049,765.91 Medical Oxygen Cylinders 333,000,541.32 Sub - Total 5,375,048,845.60 (b) Transfer of Assets to National Public Health Laboratory in Mabibo Dar es Salaam Next Generation Sequencing Machine 1,125,726,345.21 ELisa System 28,235,607.40 Nanodrop One C Spectrophotometer 96,112,125.00 Mini Wide VerticaL Protein Electrophoresis System 11 ' 636,352.00 Multisub Maxi Horizontal Electrophoresis System 6,065,280.00 Sub - Total 1,267,775,709.61 (c) Transfer of Assets to Ministry's Head Quarter in Dodoma Desktop Computers, Laptops and Printers 99,832,000.20 Hoover Machine and Water Dispensers 2,348,200.00 Office Tables, Chairs and File Cabinet 6,354,359.00 Sub - Total 108,534,559.20 Total 6,751,359,114.41 23 Controller and Auditor General AR/ COVID- 19 PEF NOTE 52/2021 Note 19:Reconciliation of Statement of Comparison of Budget and Actual Amounts and Statement of Cash flows. Description Operating Financing Investing Total Actual amount (budget Et 0 8,644,111,103 actuaL) 8,644,111,103.25 Basis differences - - - 0 Entity differences - - - 0 Actual amount (in cash 1,892,751,989 - 6,751,359,114 8,644,111,103 f low) 24 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31ST MARCH 2021 1. Introduction The financial statements present the results of implementation of the Tanzania COVID 19 Pandemic Emergency Financing Facility Project for the period of 22 September, 2020 to 31 March, 2021. PRINCIPAL PLACE OF OPERATION BANKER MINISTRY OF HEALTH, COMMUNITY DEVELOPMENT, BANK OF GENDER, ELDELRY AND CHILDREN TANZANIA Government City - Mtumba, 2 P. 0. Box 743, MIRAMBO 40478 DODOMA. STREET P.O.BOX 2939, 11884 DAR ES SALAAM - TANZANIA. RESPONSIBILITY FOR PROJECT ACCOUNTS CRDB BANK PLC, P. 0. Box 602, MINISTRY OF HEALTH, COMMUNITY DEVELOPMENT, D'O. GENDER, ELDELRY AND CHILDREN Government City - Mtumba, P. 0. Box 743, 40478 DODOMA. AUDITORS CONTROLLER AND AUDITOR GENERAL, 4 UKAGUZI ROAD, P.O.BOX 950, 411404 TAMBUKARELI - DODOMA 2. Basis of preparation The financial statements have been prepared in accordance with the Public Finance Act No. 6 of 2001 as amended in 2004 and comply with the accrual basis of accounting under the International Public Sector Accounting Standards (IPSAS). In accordance with the World Bank disbursement guidelines, the expenditures need to be incurred before the closing date of the project to be eligible for financing. The closing date for the Tanzania COVID-19 Pandemic Emergency Financing Facility Project was 28th February, 2021 and disbursement deadline was on 31st March, 2021. The closing date marked the end of implementation of the Project and the disbursement deadline marked the end of payment for expenditures incurred on or before the closing date. 25 Controller and Auditor General AR/ COVID-19 PEF /VOTE 52/2021 NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31ST MARCH 2021 Summary of significant accounting policies - continues in order to close Project books of accounts, the Project has adopted the provision of IPSAS 1 (paragraph 66 - 67) which allow the preparation of annual financial statements for a longer or shorter period than one year. Thus, the Project has prepared financial statements for the period of 22nd September, 2020 to 31st March, 2021 to close books of accounts. Procurement of goods, works, consultancy and non-consultancy services to the extent that they are reflected in these financial statements have been done in accordance with the Public Procurement Act No. 7 of 2011 as amended in 2016 and the World Bank procurement guidelines. The financial statements are presented in Tanzanian Shillings (TZS), which is the project's functional and presentation currency. 3. Authorization date/ authorization for issue The present financial statements were submitted to the Controller and Auditor General on 30th September, 2021 for certification and then submitted to the World Bank on 31s December,2021 for adoption before becoming public. Accounting Officer Date: 4. Reporting entity The Financial Statements are for the Tanzania COVID-19 Pandemic Emergency Financing Facility Project - PEF GRANT NO. TF0B3767. 5. Summary of significant accounting policies Transactions and balances Foreign currency transactions are translated into Tanzania shillings using Bank of Tanzania exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from translation of end of the period monetary assets and liabilities denominated in foreign currencies are recognized in the statement of financial performance and presented in the cash flow statement. 26 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH, 2021 Cash and cash equivalents The project started in September, 2020 with nill cash and cash equivalents and closed with a balance of cash and cash equivalent of TZS 416,767.83 Employment benefits The project was mainstreamed within the Ministry and implemented by government employees. Hence, no employment benefits were paid. Revenue from non-exchange transactions Revenue from non-exchange transactions comprises of grant amount received from the World Bank and amortized during the period. It is recognized to the extent that it is probable that the economic benefits will flow to the entity and that the revenue can be measured reliably. As per Treasury Circular No. 2 of 2018/2019 on accounting treatment of Taxpayers funds and recognition of revenue related to capital expenditure, the amount of grant received for purchase, construct or otherwise acquire non-current assets are recognized as revenue in the statement of financial performance. Other grant amounts received are recognized up front as revenue as conditions attached to the amount received have been met accordingly, whereas liability is recognized to part of the amount received of which conditions for utilization of the funds were yet to be met. Property, plant and equipment The Project started in September, 2020 and ended on 31st March, 2021. The assets procured by the Project have been internally transferred to the Ministry. The oxygen generating plants, medical oxygen manifold system and oxygen cylinders were delivered and/or installed in regional referral hospitals in Amana, Mtwara, Songea, Mbeya, Geita, Manyara and Dodoma region. The laboratory equipment such as Elisa system, Nanodrop One C Spectrophotometer; Min Wide Vertical Prot Min Wide Vertical Protein Electrophoresis System; Multisub Maxi, Maxi Holizontal Electrophoresis System and Next Generation Sequencing were delivered and installed at the National Public Health Laboratory at Mabibo Dar es Salaam. The ICT equipment and furnitures are being used at the Ministry Head Quarter. The aforementioned assets were delivered at the closure of the project in February, 2021, hence no depreciation were charged. 27 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH, 2021 Impairment of non- cash generating assets The Project assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists the Project makes an estimate of the asset's recoverable service amount. An asset's recoverable service amount is the higher of an asset's fair value less costs to sell and its value in use and is determined for an individual asset. Where the carrying amount of an asset exceeds its recoverable service amount, the asset is considered impaired and the impairment loss is recognized through surplus and deficit. In line with the Public Assets Management Guideline, 2019 issued by the Ministry of Finance and Planning, the Project has adopted the Depreciated Replacement Cost Approach in determining the asset value in use. Under the Depreciated Replacement Cost Approach, the present value of the remaining service potential of an asset is determined as the depreciated cost of the asset. The replacement cost of an asset is the cost to replace the asset's gross service potential. The cost is depreciated to reflect the asset in its used condition. Related Party Transactions Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial and operating decisions. They include relationship with subsidiaries, associates, joint ventures and key Management personnel. For the Tanzania COVID-19 Pandemic Emergency Financing Facility Project, the related party includes The World Bank; Ministry of Finance and Planning; Regional Referral Hospitals supported by the Project; the National Public Health Laboartory; Ministry of Health, Community Development, Gender, Elderly and Children (MOHCDGEC) and the MOHCDGEC's key management such as the Permanent Secretary and the Directors. Some of the Project's transactions and arrangements are with related parties and the effect of these are reflected in the Financial Statements. Grants and other Transfer Payments The Project procured essential medicines and supplies for use at the infectious disease treatment units in Zanzibar and Tanzania Mainland. The medicines and supplies were procured through Medical Stores Depatment. The related expenditures have been presented as transfer on the statement of financial performance. 28 Controller and Auditor General AR/ COVID-19 PEF NOTE 52/2021 NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH 2021 Provision, contingent liability/assets No provisions, contingent liabilities/assets were provided during the year. Events after reporting date Events after the reporting period are those events, favourable and unfavourable, that occur between the end of the reporting period and the date when the financial statements are authorised for issue. Two types of events can be identified: * Those that provide evidence of conditions that existed at the end of the reporting period (adjusting events after the reporting period); and * Those that are indicative of conditions that arose after the reporting period (non- adjusting events after the reporting period). During the period ended 31st March, 2021, no events after reporting date were reported. Measurement Basis The Project has adopted the historical cost basis in determining the monetary amounts disclosed/presented in the financial statements. Going Concern The Project has been closed. 29 Controller and Auditor General AR/ COVID-19 PEF /VOTE 52/2021 � z � � � � � о ° о �, v v ° С С С С С С С С С С С С С N 10 N N [0 N N а n а а а гi а и и и и и и и т т т т т т га у � � � � � � а � I � v ш т ы т д т 'i1 � С С С С С С Е Е Е Ё Е Е Е Е о т ш т т т т т v Q а ы ы а а а а Е Е Е Е Е Е Е � N '� О О О О 1�7 Ф � (Л N Q Q р о рΡ N lрΡ ["i [�'S R� � �f О О о о � 4'7 о [9 iL7 м О О о О i] д СА L{'1 U�i ((1 С♦ О О О (р � о �1 г о О G О О►� М у С9 � Ш !,� С'1 tl О о CJ Р'7 N р D� С] О О р О С О ц1 ц'1 Р� I� R1 С7 о о о Q1 � А �в Д [.р О N о о С� � м гО 4 и� [!3 vi N г+� ц ао !r Сд цi а м о � r� о Q � т о .3 � са сд � А и� т г- 1� т о т ог7 I� и _ s т о о N ьn т О� т n Г` о сд оо и г� ш т} fл r- V1 О А С1 ui Г_ т r� �р � ц ц_1 г"1 w 1в N N 7 � о т ti К � N М гл 1Nr � Fl т i'1 т д� W tY С � �'h У] ц1 � N Ф � � Q О о р О К о О О О �� о (S1 {р !� О О О О [� � Й С К О О f� о О О G M1 N пл N О О О О С 1А 7 К О СУ � Ф о О о Q �{'7 f`'] О rf � о о О О р� О О1 Ш LG �Л о О О О Q1 М О I� А О N О О G i0 I Е О N ВрΡрΡ1 [�'! 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