Funded by: International Development Association (IDA) Grant No. D5430-TO FINANCIAL STATEMENTS FOR THE 14 MONTHS ENDED 30TH JUNE 2021 STATISTICAL INNOVATION & CAPACITY BUILDING IN TONGA PROJECT (SICBTP) CONTENT Pages 1. Statement of Management Responsibility 2 2. Independent Auditor's Report 3-4 3. Statement of Receipts and Payments 5 4. Statement of Comparison of Budget and Actual Amounts. 6 5. Notes to the Financial Statements 7 1 STATISTICAL INNOVATION & CAPACITY BUILDING IN TONGA PROJECT (SICBTP) Statement of Management Responsibility In the opinion of the Implementing Agency for the Statistical Innovation and Capacity Building in Tonga Project (SICBTP), the accompanying statement of receipts and payments and the accompany statement of comparison of budget and actual amounts for the 14 months ended 30th June 2021 gives a true and fair view of the matters to which they relate, cash flow and fund position of the Statistical Innovation and Capacity Building in Tongan Project (SICBTP) for the year ended. They have also been properly drawn up in accordance with accounting policy described in Note 2 of the Financial Statement. 15th December 2021 Dr. Viliami K. Fifita Maletino Hola Government Statistician - Project Coordinator Tonga Statistics Department SICBT Project 2 JOAG ITEORITY, IrUU 1'ADII & rkANSPARENCY Auditor General's Report To the Chief Executive Officer Tonga Statistics Department GRANT NO. D543 - TO: STATISTICAL INNOVATION AND CAPACITY BUILDING IN TONGA PROJECT We have audited the accompanying financial statements of the Grant No. D543-TO: Statistical Innovation and Capacity Building in Tonga Project, for the financial year ended 30h June, 2021 which comprise of the Statement of Receipts and Payments, combined Statement of Budget and Actual Expenditure and the Notes to the Account. Management's Responsible for the Financial Statements According to the Public Finance Management Act 2002 and the project's agreement dated 24' March 2020, management is responsible for the preparation and presentation of the financial statements in accordance with the International Public Sector Accounting Standards, (IPSAS). This responsibility includes design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that are free from material misstatement, whether due to fraud and error. In addition to the responsibility for the preparation and presentation of the financial statement described above, management is also responsible for ensuring that activities, financial transactions, and information reflected in the financial statements are in compliance with the authorities which government them. Auditor General's Responsibility Our responsibility is to express an opinion on the financial statements based on our audit. We conducted the audit in accordance with the International Standards of Supreme Audit Institutions, (ISSAls). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. In addition to the responsibility to express an opinion on the financial statements, our responsibility includes expressing an opinion on whether the activities, financial transactions and information reflected in the financial statements are, in all material respects, in compliance with the project's agreement. This responsibility includes performing procedures to obtain audit evidence about whether the project's expenditures have been applied to the purposes intended by the project's agreement. Such procedures include the assessment of the risks of material non-compliance. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinions. Po Bax 50, Tupou College Old Boys Building, Nuku"alofa, Tonga, South West Pacife 3 Telephone: (676)21-600 | Facsimile: (676) 23-749 1 Email: info@audit.gov.to | Website: www.audit.gov.to Opinion In our opinion, the financial statements of the project, Grant No. D543-TO: Statistical Innovation and Capacity Building in Tonga Project, for the financial year ended 3011 June, 2021 are prepared, in all material respects, in accordance with the International Public Sector Accounting Standards, IPSAS. Opinion on Compliance In our opinion, in all material respects on the use of the grant proceeds, the activities, financial transactions and information reflected in the financial statements are in compliance with the authorities govern them. AUDI/. Sefita Tangi FCPA ( rit AUDITOR GENERAL * Dated: 17th December, 2021 Po Box 50, Tupou College Old Boys Building, Nuku 'alofa, Tonga, South West Pacific 4 Telephone: (676)21-600 | Facsimile: (676) 23-749 1 Email: info@audit.gov.to I Website: www.audit.gov,to STATISTICAL INNOVATION & CAPACITY BUILDING IN TONGA PROJECT (SICBTP) STATEMENT OF RECEIPTS AND PAYMENTS FOR THE 14 MONTHS ENDING 30 JUNE 2021 30 Jun 2021 Receipts/(Payments) Expressed in Tongan Pa'anga Controlled by the Notes Entity RECEIPTS 2.3 IDA Grant No. D5430-TO $670,388.47 Total Receipts $670,388.47 PAYMENTS 2.4 Component 1 1.1 2020/21 Household Income & Expenditure Survey $393,282.03 1.2 2024/25 Household Income & Expenditure Survey $0.00 1.3 Data collection for economic statistics $0.00 1.4 Data collection to improve early warning systems for natural disasters $69,498.40 Component 2 2.1 Analytical Training $0.00 2.2 Data and research dissemination $0.00 2.3 ICT and office furnishing improvements $114,292.84 Component 3 3.1 Project coordinator $0.00 3.2 Incremental operating costs $1,094.04 Total Payments $578,167.31 Net Receipts/(Deficits) $92,221.16 Changes in Cash Balances Cash at Bank on hand - 1 July 2020 $0.00 Cash at Bank on hand - 30 June 2021 $92,221.16 Net Increase/(Decrease) in Cash $92,221.16 Balance Check $0.00 5 STATISTICAL INNOVATION & CAPACITY BUILDING IN TONGA PROJECT (SICBTP) STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS FOR THE 14 MONTHS ENDING 30 JUNE 2021 Expressed in Tongan Pa'anga Actual Amounts Original Budget Variance (Original and Actual Budget) CASH INFLOWS IDA Grant No. D5430-TO $670,388.47 $4,614,994.12 $3,944,605.65 Total Cash Inflows $670,388.47 $4,614,994.12 $3,944,605.65 CASH OUTFLOWS Component 1 1.12020/21 Household Income & Expenditure Survey $393,282.03 $1,453,723-15 $1,060,441.12 1,2 2024/25 Household Income & Expenditure Survey $0.00 $1,269,123.38 $1,269,123.38 1.3 Data collection for economic statistics $0.00 $369,199.53 $369,199.53 1.4 Data collection to improve early warning systems for natural disasters $69,498.40 $115,374.85 $45,876.45 Component 2 2.1 Analytical Training $0.00 $230,749.71 $230,749.71 2.2 Data and research dissemination $0.00 $230,749.71 $230,749.71 2.3 ICT and office furnishing improvements $114,292.84 $309,204.61 $194,911.77 Component 3 3.1 Project coordinator $0.00 $553,799.29 $553,799.29 3.2 Incremental operating costs $1,094.04 $83,069.89 $81,975.85 Total Cash Outflows $578,167.31 $4,614,994.12 $4,036,82681 Net Cash Flows $92,221.16 $0.00 -$92,221.16 6 STATISTICAL INNOVATION & CAPACITY BUILDING IN TONGA PROJECT (SICBTP) NOTES TO THE FINANCIAL STATEMENTS FOR THE 14 MONTHS ENDING 30 JUNE 2021 1. GENERAL INFORMATION The Government of Tonga through the Implementation Agency- Tonga Statistics Department has received a grant from the International Development Association under the Statistical Innovation and Capacity Building in Tonga Project (SICBTP). The SICBTP project development objective is to improve the quality and efficiency of welfare data collection and accessability to comparable welfare data in Tonga. The SICBTP Project Financing Aggrement was declared effective on 07th May 2020. The value of the total IDA Original Grant in USD is $2 million (equilavent of TOP $4.6 million). The SICBTP Project is implemented under the overral guidance, coordination and monitoring of a Project Steering Committee of which includes the Implementing Agency - Tonga Statistics Department, Executing Agencies - Ministry of Finance, Minister of Statistics Department and also the Task Team Leader for the Project assigned from the World Bank. In addition, the Central Services Unit (CSU) within Minitry of Finance has been set up to support allI DA Financed Projects, 2. SUMMARY OF ACCOUNTING POLICIES 2.1 Basis of Preparation The Financial Statements have been prepared in accordance with the Financing Agreement between the Implementing Agency- Tonga Statistics Department (TSD) and the International Development Association (IDA. The Financial Statements are prepared on the basis of Historical Cash Basis 1n accordance to the IPSAS Financial Reporting under the Cash Basis of Accounting. The accounting policies based on the Financing Agreement have been applied consistently for the 14 months presented in this Financial Statements. There were no changes in the accounting policies applied in this Financial Statement. The Financial Statements are presented in Tongan Pa'anga and values are rounded to the nearest two decimal places unless otherwise specified. 2.2 Reporting Entity The Financial Statements are for the Tonga Statistics Department. 2.3 Receipts Grants are received from the project's bank account at the World Bank. The amount is based on the Withdrawal Application from SICBTP uploaded through the Client Connection for approval and transfer from the World Bank to the project's bank account at Tonga Development Bank (TDB). Grant No. Borrower Reference Beneficiary Name CCY Application Amount IDA D5430-TO SICBTP-IDA-02 Statistical Innovation and Capacity Building in Tonga Project TOP $300,000.00 IDA D5430-TO SICBTP-IDA-03 Statistical Innovation and Capacity Building in Tonga Project TOP $168,559.28 IDA D5430-TO SlC8TP-IDA-05 Statistical Innovation and Capacity Building in Tonga Project TOP $81,755.79 IDA D5430-TO SICOTP-IDA-07 Statistical Innovation and Capacity Building in Tonga Project TOP $120,073.40 TOTAL FROM GRANT NO. IDA 05430-TO $670,388.47 Z.4 Payments Payments relate to all expenditure payments made to suppliers for goods and services relating to SICBTP. Payments are approved by the CEO for Tonga Statistics Department and are paid in accordance with the Program Operational Manual (POM} and the PFMA Treasury Instructions through the centralised government accounting system managed by Treasury Division of the Ministry of Finance. 3. FINANCIAL PERIOD This financial statement is provided for the period starting on the 7th May 2020 and ending 30th of June 2021(14 months). 4. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment items are stated at cost (TOP) Histadcal Cost $ SICBTP Project Tablets, GPS Device and Accessories $69,498.40 Notebook Computer $5,200.00 Network Equipment $14,478.00 Video Conference Equipment and Recording Kit $56,139.29 Colour Multifunction Printer/Copier $38,475.55 SICBTP - Total $183,791.24 5. EXPLANATION OF THE DIFFERENCES BETWEEN ACTUAL AND BUDGET Variance is due to the fact that this is the first year of implementation and the procurement of certain activities started off slow, For example, the Project Coodinator role was only finalised in July 2021, outside this auditing period.