NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS 31st DECEMBER 2019 j. walter udoyop CHARTERED ACCOUNTANTS & COMPANY NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) AUDITED FINANCIAL STATEMENTS 31s TDECEMBER 2019 TABLE OF CONTENTS Page Project Profile 2 Project Background Information 4 Statement of Projects Management Team Responsibilities 5 Report of the Independent Auditors 6 Statement of Financial Position 8 Statement of Financial Performance 9 Statement of Changes in Equity 10 Statement of Cash Flow 11 Statement of Principal Accounting Policies 12 Notes to the Financial Statement 13 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) AUDITED FINANCIAL STATEMENTS 31ST DECEMBER 2019 PROJECT PROFILE CONTD. BANKERS: Central bank of Nigeria Central Business District Abuja AUDITORS: J. Walter Udoeyop & Co No.111, Oron Road Uyo Akwa Iborn State 3 j. walter udoeyop CHARTERED ACCOUNTANTS & COMPANY Plot 804, Ngozi Okonjo-lweala Way Utako Abuja, FCT, Nigeria. Tel. 0703-347-0066, Email judoeyop@gmai.com REPORT OF THE INDEPENDENT AUDIT OF NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) Report on the financial statements We have audited the accompanying financial statements of Nigeria State Health investment project (NSHIP) for the year ended 31 December 2019 set out on pages 8 to 16. Project Implementation Unit's responsibility for the financial statements The Project Implementation Unit (PIU) is responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards and with the requirements of the World Bank Financing Agreement and Local laws. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor's responsibility Our responsibility is to express an independent opinion on the financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform our audit to obtain reasonable assurance that the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Project Implementation Unit (PIU)as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 6 Opinion In our opinion the accompanying financial statements give a true and fair view of the state of NSHIP financial affairs at 31 December 2019 and of its Income and cash flows for the year then ended in accordance with Financial Reporting Council of Nigeria, World Bank Financing Agreement, Project Implementation Manual and the local laws. John Udoeyop FRC120161000000113831 J. Walter Udoeyop & Company Q /ICAN Chartered Accountants Abuja, Nigeria Date 7 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) AUDITED FINANCIAL STATEMENTS STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2019 2019 2018 NOTE N 14 ASSETS NON-CURRENT ASSETS Property, Plant & Equipment 1 128,899,672 118,567,227 TOTAL ASSETS 128,899,672 118,567,227 CURRENT ASSETS Cash & Cash Equivalents 2 62,832,088 131,942,926 Receivables 3 1,277,995,061 998,542,994 TOTAL CURRENT ASSETS 1,340.827,149 1,130,485,920 TOTAL ASSETS 1,469,726,821 1,249,053,146 CAPITAL AND RESERVES Financial Performance - Surplus/(Deficit) 1,198,053,891 982,770,818 Foreign Exchange Translation 578,733 578,733 TOTAL SURPLUS 1,198,632,624 983,349,551 LIABILITIES CURRENT LIABILITIES Payables 4 6,568,290 1,177,688 Accruals 5 264,525,524 264,525,524 TOTAL CURRENT LIABILITIES 271,093,814 265,703,212 TOTAL EQUITY AND LAIBILITIES 1,469,726,821 1,249,053,146 Hajia Binta Ismail (Project Coordinator)....................... .. Signature Date Daniel Udounw a (Project Accountant) ..................................................................... ........... Signature Date Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7. 8 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 DECEMBER 2019 2019 2018 NOTES N 4 REVENUE IDA Credit 6 778,293,181 2,841,246,147 Total Revenue 778,293,181 2,841,246,147 EXPENDITURE Consultancy, Training & Workshop 7 395,456,118 1,945,223,777 Operating Expenses 8 93,380,436 32,129,678 Impairments on Property, Plants & 1 74,173,554 50,511,874 Equipment Total Expenditure 563,010,108 2,027,865,329 Surplusl(Deficit) 215,283,073 813,380,818 Exchange Gain 578,733 Surplus/Deficit 215,283,073 813,959,551 Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7. 9 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2019 RETAINED FOREIGN TOTAL EARNING EXCHANGE EQUITY TRANSLATION NN N1 Balance as at 0110112018 169,390,000 - 169,390,000 Financial Performance for the year Surplus/(Deficit) for the year 813,380,818 578,733 813,959,551 Balance as at 3111212018 982,770,818 578,733 983,349,551 Current Year Changes in Equity Surplus/(Deficit) for the Year 215,283,073 - 215,283,073 Balance as at 3111212019 1,198,053,891 578,733 1,198,632,624 Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7 10 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS STATEMENT OF CASH FLOW AS AT 31 DECEMBER 2019 2019 2018 Cash inflow from operating activities N N Surplus/(Deficit) for the Year 215,283,073 813,959,551 Adjustments to reconcile surplus to net cash flow from operations: Impairment on Property, Plant & equipment 74,173,554 50,511,874 Exchange Difference - 578,733 Net cash flow from operating activities 289,456,627 865,050,158 Cash flow from Investing activities Additions to Property, Plants & equipment (84,506,000) (56,189,493) Net cash flow from financing activities (84,506,000) (56,189,493) Cash flow from Financing activiles (increase)/Decrease in Receivables (279,452,067) (1,118,568,828) Increasel(Decrease) in Payables 5,390,602 265,698,852 Net cash flow from financing activities (274,061,465) (852,869,976) Net increase/(decrease) in cash flow (69,110,838) (44,009,311) Cash and cash equivalent as at 1' October 2018 131,942,926 175,952,237 Cash and cash equivalents as at 31st 62,832,088 131,942,926 December Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7. 11 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS STATEMENT OF ACCOUNTING POLICIES The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied throughout the years presented, unless otherwise stated. a) Basis of preparation The financial statements are prepared in compliance with International Public Sector Accounting Standards (IPSAS). The financial statements are presented in the functional currency, Nigeria Naira (N), and prepared under the historical cost convention. The preparation of financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on the directors' best knowledge of current events and actions, actual results ultimately may differ from those estimates. b) Revenue recognition DA credits are recognized when they are received or become receivable from the financiers (World Bank) c) Property, Plant & Equipment The project has not acquired any item of Property, Plant and Equipment yet, but the following policies will be applied when it eventually acquires them. Depreciation on the assets is calculated using the straight line method to write down their cost or revalued amounts to their residual values over their estimated useful lives, as follows: Computer Equipment and Software 33% Plant and Machinery 25% Office Equipment, Furniture and Fittings 20% Motor Vehicles 28% The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assets carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. Gains and losses on disposal of property, plant and equipment (if any) are determined by reference to their carrying amounts and are taken into account in determining operating profit. 12 п г О О � � j � [тЛ _ С1р Q1 и � ц� � и c�i й р � -< О С С �, �.-� � с� сг � у� ,� т-! й й �^; �°л w i � � �т �rt j � о�г; j й� т^�7 �� `� �, No � ° ° �� ю � -- 'о v ы j с�з С� ° �,,�-, Q w т� NN cfl �� �` � �. �С_7 � р tL] � � и � D �р � CD � � Г т т� '� т � � �т т т т � �г w� о и j � ч г э о � о� ;д оо � � ° � Q ° ,`�,�,� �° � � егi с.п �т и� г.э со о© 3• дз о с� � �, оо :а. � �v � о сп -�. � о w w г� гго � � N � tл rv --.� tп -а w оо � � ш iv сл о� о д5. сп С �`с� сс> �t iv о sл cn ,� с°L� о rn а°� о о�а rn о �: � � rt о°о в c�i°о °о °о `� гй Q .а. сп � оа rn tп t,л � и вэ с� � � � ёа`+ orn оо о®о Gя tп £ � й � `с�л � �,c�i+ ci; в 0 ' �-а w и оо с�м сп �� ' ti �° � --�'.i с�'п c�is � z �- � � о с� � сл а � � ,.� � о � са о�о Vo�o � � � G� v � -� -,r а, � т оо ао оа о� . � w � w w с.,,� г� � А [л ё rс�т, оо стi � � _a�i fio п � ya�i с�'r'п rn w`т з с�р � п� -D1 е,.+ .�s ао � ti � � ,� � т :,s cQ -.i � с7 �,а �д �, �-' � с х � о в� av � в�т � й� � �� rv j w ti, _ �,а�оо ы �w � � �i оо сл а© -� �э � сп пз г ш°-..i�' � w� о rn� -f т -.1 N � С�77 6�i t�L1 О С�О г��г Gi .. 1�А �7. Ci� �` С.79 � ® � � г � � � � � Г � а� � т� � �� т �л z� � �� NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 CONTD. 2. Cash and Cash Equivalents N 9 Special Account 62,765,433 131,384,101 Drawn-Down Account 66.655 558,825 62,832,088 131,942,926 3. Receivables N 14 Staff Advances (note 10) 14,785,067 18,167,478 Due from AF-NSHIP 1,263,209,994 980,375,516 1,277,995,061 998,542,994 IDA Credits is treated as revenue in line with IPSAS 23 which prohibits the treatment of Grants as Equity 4. Payables N 14 OPM (Consultancy -Deliverable 10) 132,262,762 132,262,762 OPM (Consultancy - Deliverablel 1) 132,262,762 132,262,762 264L525 524 264,525,524 Payments have been done in 2020 5. Other Payables 14 Staff unclaimed Advances (note 11) 5 ' 497,492 106,890 Unclaimed Allowances 1,050,798 1,050,798 Local Creditors 20,000 20,000 6,568,290 1,177,688 6. IDA Credit 4 4 Disbursements during the Year 778,293,181 2,841,246,147 778,293181 2 841, 46,147 14 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 CONTD. 7. Workshop, Training & Consultancy, M&E 4 N Consultancy 278,571,359 1,831,554.321 Training 74,799,888 110,461,835 Monitoring & Evaluation 42,084,070 3,207,621 1,062,074,390 1,945,223,777 8. Operating Cost 4 4 Bank Charges 113,610 256,838 Transport & Per Diem/Honorarium 879,220 1,050,000 Maintenance of Vehicles 450,000 6,388,400 Maintenance of Office Building 123,000 1,621,300 Local Transport & Travels 10,906,858 3,986,088 Printing & Stationery 300,000 879,050 Fumigation 2,545,305 2,840,121 Advert, Publicity and Media Expenses 690,000 1,641,052 Office Security 1,914,496 2,646,000 Maintenance of Office Equipment 0 300,000 Sundry Office Items 600,000 300,000 Insurance of Project Vehicles 30,561,100 0 Servicing of Other Meetings 6,850,847 5,772,329 Office Rent 36,846,000 0 Motor Vehicle Fueling Cost 600,000 600,000 Fueling & Maintenance of Generator 0 3,848,500 93,380,436 32,129,678 15 NIGERIA STATE HEALTH INVESTMENT PROJECT (NSHIP) FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 CONTD. 9 Staff Advances N N Olubajo Lekan 1,782,879 1,782,879 Adekusibe Michael 2,389,573 1,400,873 Danladi Seidu 16,428 16,428 Akinyemi S. 0. 2,500,870 2,500,870 Mohammed Mashin 189,050 - John Onah 98,055 98,055 Opedile Patrick I. 101,712 101,712 Benson Odaman - 499,125 Oluremi Onabanjo - 2,261,249 Seyi Olosunde 4,830,361 4,830,361 Idris Bello 200,000 - Idris Yusuf - 93,428 Binta Ismail 55,000 - Korede Bankole 1,139,240 - Anna Edem - 2,261,249 Aisha S. Omar 499,125 Roseline Olufumbi Kolade - 499,125 Fakeye Elizabeth Modupe 1,125,000 1,125,000 Eze Lambert - 75,000 Umar A Umar - 123,000 Abubakar Abdulmajid 306,900 - Moses Olusegun Olayinka 50,000 - 14,785,067 18,167,478 The Outstanding advances were retired in January 2020 10 Staff Unclaimed Advances N N Egahi Ada 198,851 - Stephen Yesufu 198,851 - Bakunawa Garba 5,099,790 - Ibrahim Hassan - 4,280 Daniel Udounwa - 14,000 Ganiyu Salau - 76,050 Salamatu Saleh - 6,280 Bassey Innocent Ita - 6,280 5,497,492 106,890 16 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS 31ST DECEMBER 2019 In *ar adoo op CHARTERED ACCOUNTANTS & COMPANY NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) AUDITED FINANCIAL STATEMENTS 31ST DECEMBER 2019 TABLE OF CONTENTS Page Project Profile 2 Project Background Information 4 Statement of Project's Management Team Responsibilities 5 Report of the Independent Auditors 6 Statement of Financial Position 8 Statement of Financial Performance 9 Statement of Changes in Equity 10 Statement of Cash Flow 11 Statement of Principal Accounting Policies 12 Notes to the Financial Statement 13 1 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) AUDITED FINANCIAL STATEMENTS 31ST DECEMBER 2019 PROJECT PROFILE NAME OF PROJECT: NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) ADDRESS: NO. 32, Queen Elizabeth Crescent Asokoro Abuja Email: naionanhggrmi.com nation! nship1k 0)maflxorn PROJECT COMMENCEMENT DATE: November 2018 PROJECT MANAGEMENT TEAM: Hajia Binta Ismail - National Project Coordinator Mohammed A. Mohammed - Deputy National Project Coordinator Daniel Udounwa - Project Accountant Abdulrasheed Ado - PBF Focal Person, Bauchi State Peter Adamu Mathias - PBF Focal Person, Borno State Yahaya Ahmed - PBF Focal Person, Gombe Yohanna Markus Y. - PBF Focal Person, Taraba State Abubakar Saleh - PBF Focal Person, Yobe State PROJECT IMPLEMENTATION AGENCY: National Primary Healthcare Development Agency Plot 681/682, Port Harcourt Crescent Area 11 Garki Abuja 2 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) AUDITED FINANCIAL STATEMENTS 31ST DECEMBER 2019 PROJECT PROFILE CONTD. PROJECT FINANCIERS: World Bank Group Washington DC USA BANKERS Central bank of Nigeria Central Business District Abuja AUDITORS: J. Walter Udoeyop & Co Plot 804, Ngozi Okonjo-lweala Way Utako Abuja 3 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) AUDITED FINANCIAL STATEMENTS 31ST DECEMBER 2019 PROJECT BACKGROUND INFORMATION The Nigerian Health Investment Project (NSHIP) is a result-based (RBF) financing mechanism which builds on lessons from the State Health Systems Development Projects and principles of fiscal decentralization to support targeted health systems reforms in three (3) states for the effective use of public resources to deliver essential health services to the poor. The project proposes to demonstrate that public resources can be effectively leveraged through strategic use of Performance Based Financing to strengthen accountability at all levels of the Health System. The RBF mechanism allows direct monetary payments to Health Facilities with autonomy to use the Financial Resources for the improvement of health facilities as well as incentive payments to staff and social marketing. The National Primary Health Care Development Agency (NPHCDA), an Agency of the Federal Government which provides and implementation guidance to strengthen the delivery of Primary Health Care Services in the Country serves as the National Coordinating Office. The Project works with the Federal Government and eight states: Adamawa, Bauchi, Bornu, Gombe, Nasarawa, Ondo, Taraba and Yobe States. The NSHIP States (Adamawa, Nasarawa and Ondo) commenced project implementation since December 2011 while the project objective is to increase the delivery and use of high impact maternal and child health interventions and to improve the quality of care at selected health facilities in the participating States. 4 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) AUDITED FINANCIAL STATEMENTS 31ST DECEMBER 2019 PROJECT MANAGEMENT TEAM'S RESPONSIBILITY The Project Implementation Unit (PMU) is required to prepare the financial statements for each financial year that gives a true and fair view of the state of financial activities of AF-NSHIP at the end of the year and of the Receipt and Disbursement of funds for year then ended and comply with the requirements of Project Implementation Manual (PIM), world Bank financing agreement and the local laws. The responsibitides include ensuring the Company: 1. Keeps proper accounting records that disclose, with reasonable accuracy, the financial position of the Project and comply with the requirements of the Project Implementation Manual (PIM), world Bank financing agreement and the local laws. 2. Establish adequate internal controls to safeguard its assets and to prevent and detect fraud and other irregularities; and 3. Prepare its financial statements using suitable accounting policies supported by reasonable and prudent judgments and estimates and are consistently applied. The PlU accept 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 requirements of the Financial Reporting Council of Nigeria, Project Implementation Manual (PIM), world Bank financing agreement and the local laws. The P1U are of the Opinion that the financial statements give a true and fair view of the state of the financial affairs of the Project and of the Surplus for the year. PIU further accepts the responsibility for the maintenance of the accounting records that may be relied upon in the preparation of financial statements, as well as adequate systems of internal financial control. Hajia Binta Ismail Daniel Udounwa Project Coordinator Date Project Accountant Date 5 J. - udoeyop CHARTERED ACCOUNTANTS & COMPANY Plot 804, Ngozi Okonjo-lweala Way Utako Abuja, FCT, Nigeria. Tel 0703-347-0066, Email:judoeyop@gmail.com REPORT OF THE INDEPENDENT AUDIT OF NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) Report on the financial statements We have audited the accompanying financial statements of Nigeria State Health Investment project (AF- NSHIP) for the year ended 31 December 2019 set out on pages 8 to 15. Project Implementation Unit's responsibility for the financial statements The Project Implementation Unit is responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards and with the requirements of the World Bank Financing Agreement and Local laws. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor's responsibility Our responsibility is to express an independent opinion on the financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform our audit to obtain reasonable assurance that the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, (PMU) as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 6 Opinion In our opinion the accompanying financial statements give a true and fair view of the state of AF-NSHIP financial affairs at 31 December 2019 and of its Income and cash flows for the year then ended in accordance with Financial Reporting Council of Nigeria, World Bank Financing Agreement, Project Implementaton Manual and the local laws. John Udoeyop FRC/20161000000113831 36c1CA J. Walter Udoeyop & Company 0629429 Chartered Accountants ....L.1 Abuja, Nigeria Date 7 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) AUDITED FINANCIAL STATEMENTS STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2019 2019 2018 NOTE N N ASSETS NON-CURRENT ASSETS Property, Plant & Equipment 1 163,510,000 233,930,000 TOTAL ASSETS 163,510,000 233,930,000 CURRENT ASSETS Cash & Cash Equivalents 2 211,761,623 57,979,618 Receivables 3 187,959,949 187,794,095 TOTAL CURRENT ASSETS 399,721,572 245,773,713 TOTAL ASSETS 563,231,572 479,703,713 CAPITAL AND RESERVES Financial Performance - Surplusl(Deficit) 563,231,872 479,703,713 TOTAL EQUITY 563,231,572 479,703,713 TOTAL EQUITY & LIABILITIES 563,231,572 479,703,713 Hajia Binta Ismail (Project Coordinator) .................... .. ....................... .. .o. . .. . Signature Date try eLL 2A Daniel Udounwa (Project Accountant) .......................................................................................... Signature Date Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7. 8 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 DECEMBER 2019 FOR THE FORTWO YEAR ENDED MONTHS 31 DECEMBER PERIOD ENDED 2019 31 DECEMBER 2018 NOTES N REVENUE IDA Credit 4 1,207,150,198 732,000,000 Miscellaneous 5 23,928,485 - Total Revenue 1,231,078,683 732,000,000 EXPENDITURE Consultancy, Training & Workshop 6 948, 667,953 220,735,345 Monitoring & Evaluation 7 77,572,986 5,855,548 Operating Expenses 8 121,309,885 25,705,394 Total Expenditure 1,147,550,824 252,296,287 SurplusiDeficit 83,527,859 479,703,713 Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7. 9 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2019 RETAINED TOTAL EARNING EQUITY n . Balance as at 0111012018 Financial Performance for the two months period Surplus/(Deficit) for the two months 479,703,713 479,703,713 period Balance as at 3111212018 479,703,713 479,703,713 Current Year Changes in Equity Surplus/(Deficit) for the Year 83,527,859 (143,585,015) Balance as at 3111212019 563,231,572 336,118,698 Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7 10 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS STATEMENT OF CASH FLOW AS AT 31 DECEMBER 2019 FOR THE YEAR FOR TWO ENDED 31 MONTHS DECEMBER 2019 PERIOD ENDED 31 DECEMBER Cash inflow from operating activities 2018 Surplus/(Deficit) for the Year 83,527,859 479,703,713 Adjustments to reconcile surplus to net cash flow from operations: Impairments to property, plants & equipment 70,420,000 Net cash flow from operating activities 153,947,859 497,273,712 Cash flow from investing activities Additions to Property, plants & equipment - (251,500,000) Net cash flow from investing activities (251,500,000) Cash flow from financing activities (Increase)/decrease in Receivables (165,854) (187,794,095) Net cash flow from financing activities (165,854) (187,794,095 Net increase/(decrease) in cash flow 153,782,005 57,979,618 Cash and cash equivalent as at 1st January 57,979,618 Cash and cash equivalents as at 31st 211,761,623 57,919,618 December Accounting Policies and Notes form part of these financial statements, Auditors' report on pages 6-7. 11 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS STATEMENT OF ACCOUNTING POLICIES The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied throughout the years presented, unless otherwise stated. a) Basis of preparation The financial statements are prepared in compliance with International Public Sector Accounting Standards (IPSAS). The financial statements are presented in the functional currency, Nigeria Naira (N), and prepared under the historical cost convention. The preparation of financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on the directors' best knowledge of current events and actions, actual results ultimately may differ from those estimates. b) Revenue recognition IDA credits are recognized when they are received or become receivable from the financiers (World Bank) c) Property, Plant & Equipment The project has not acquired any item of Property, Plant and Equipment yet, but the following policies will be applied when it eventually acquires them. Depreciation on the assets is calculated using the straight line method to write down their cost or revalued amounts to their residual values over their estimated useful lives, as follows: Computer Equipment and Software 33% Plant and Machinery 25% Office Equipment, Furniture and Fittings 20% Motor Vehicles 28% The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. Gains and losses on disposal of property, plant and equipment (if any) are determined by reference to their carrying amounts and are taken into account in determining operating profit. 12 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF.NSHIP) FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 1. Property, Plants &. Equipment Motor Vehicles Total Cost N N As at 01/01/2019 251,500,000 251,000,000 Additions 0 0 As at 3111212019 251,500,000 251,500,000 Depreciation As at 01/01/2019 17,570,000 17,570,000 Current Year Charge 70,420,000 70,420,000 As at 3111212019 87,990,000 87,990,000 NBV as at 3111212018 233,930,000 233,930,000 NBV as t 3111212019 163,510,000 163,510,000 2. Cash and Cash Equivalents N 9 Special Account 46,140,546 15,127,768 Drawn-Down Account 165,621,078 42,851,849 211,761,624 57,979,618 3. Receivables N N Staff Advances (note 9) 167,051,269 187,794,094 Local Contractor 20,908,680 - 187,959,949 187,794,094 13 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 CONTD. 4. IDA Credit N Disbursements during the Year 1,207,150,198 732,000,000 1,207,150,198 732,000,000 IDA Credits is treated as revenue in line with IPSAS 23 which prohibits the treatment of Grants as Equity 5. Miscellaneous Income 4 4 Miscellaneous Income 1,207,150,198 732,000,000 1,207,150,198 732,000,000 6. Workshop Training & Consultancy N N Stakeholders Training 120,406,553 45,669,814 Independent Verification Agents 220,698,777 16,953,916 International & Local Consultants 44,949,614 13,871,400 Contract Management Verification Agents 554,125,579 73,477,124 Impact Assessment 7,765,695 71,763,092 Foreign Training 721,735 - 948,667,953 220,735,345 7 Monitoring & Evaluation N N Monitoring & Evaluation 77,572,986 5,866,548 77,572,986 5,866,548 8. Operating Cost 1 4 Bank Charges 430,535 137,849 Transport & Per Diem/Honorarium 1,575,000 6,915,546 Fumigation 3,392,350 200,000 Office Security 1,582,376 882,000 Vehicle Maintenance 2,758,500 - Office Building Maintenance 300,000 - Local Transport & Travel 12,398,143 - Internet Subscription 27,156,231 - Fueling & Maintenance of Generator 1,296,750 - Impairment, Property Plants & Equipment 70,420,000 17,570,000 121,309,885 25,705,394 14 NIGERIA STATE HEALTH INVESTMENT PROJECT (AF-NSHIP) FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 CONTD. 9 Staff Advances 4 Ogbe Oritseweyimi 1,699,573 1,699,573 Binta Ismail 2,725,200 - Mohammed A. Mohammed 4,070,095 Daniel Udounwa 1,371,000 - Adekusibi Adeleye 6,369,320 3,151,750 Benita Ukwueze 716,871 - Muhammad Mashin 1,350,000 - Korede Bankole 2,228,800 204,000 Ibrahim Sirajo 3,025,000 300,000 NPHCDA-NSHIP 29,938,973 182,438,771 167,051,269 187,794,094 15