SÌli 56É T>ru Ti61 6i6161)LD NATIONAL AUDIT OFFICE «erd seqas>esa Ny No. IEN:E/\M EYCMASP 01 /1908 Your No } Datc } Ij oember 2O20 Secretary. M oinistryf EFnvironment. Report of the Auditor General on the Financial Statenents of the Climate Mitigation Action Support Project for the 09 months period ended 31 December 2019 The Engish version of the above mentioned report along with ihe copy of a certified financil staltemets is sent herewith. W.P.C.Wickramarathne Auditor General Copies to 01. Scecretary. tinistry oel Finance 01. Project Director. Climate Mitigation Action Support Project iGýbAL F[Uýrr6 W 6116O5L NATIONAL AUDIT OFFICE -a 86. EN.EIME/CMASP, 01 1908 -b . November 2020 y oYour No, D ter Secretary. Ministry of Environment Report of the Auditor General on the Financial Statements of the Clinate Mitigation Action Support Project for the 09 months period ended 31 December 2019 i. Financial Statements 1.1 Opinion The audit of the financial staternents of the (limate Mitigation Action Support Project for the 09 months period ended 31 December 2019 comprising the statement of financial position as at 31 December 2019 and the statement of expenditure and cash how statement for the year then ended and notes to the financial statements. including a summary of signiticant accounting policies was carried out under mv direction in pursuance of provisions in Article 154(1) of the Constitution of the Democratic Socialist Republic of Sri [anka read in conjunction with provisions of Section II (A) (a) of the Grant Agreement No. TFOB0017 dated 11 April 2019 entered into between the Democratic Socialist Republic of Sri Lanka and the International Bank for Reconstruction and Development. In mv opinion, the accompanying financial statements give a true and fair view of the financial position of the Project as at 3 1 December 2019. staternent of expenditure and its cash flows for the vear then ended in accordance with Sri Lanka Accounting Standards. 1.2 Basis for Opinion I conducted my audit in accordance with Sri Lanka Auditing Standards (SLAuSs). MV responsibilities. undcr those standards are further described in the section of Auditor's Responsibilities for the Audit of the Financial Statements appeared in this report. I believe that the audit evidence I have obtained is sufficient and appropriate to prov ide a basis for my opinion. 1.3 Other Information on Performance of the Project The other information as stated below% does not include in the financial statenents and Ny opinion thereon does not cover the other information. * The activities of the Project expected to be implemented under 04 components during the period of the Project. However. no any physical progress had been achieved during the period of 09 months under revicw. * Out ofallocation of Rs. 4,126.000 made in the Budget Lstimate for the % ear 2019. a sum of Rs. 1.129.506 representing 27 per cent had on]y been utilized at the end of the period under review. 1.4 Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance wxith Sri Lanka A-ccounting Standards and for such internal control as managrement determine is necessary to enable the preparation of financial statements that are free from material misstatement. whether due to fraud or error. Those charged with governance are responsible for oversecing the Project*s financial reporting process. 1.5 Auditor's Responsibilities for the Audit of the Financial Statements Ny objecti%e is 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 auditor's report that includes my opinion. Reasonable assurance is a high 2 NXIIf)\ m U )1 4)]111( i level of assurance. but is not a 1-uarantee that an audit conducted in accordance xith Sri Lanka Auditin Standards will always detect a material misstatement wxhen it exists. Misstatements can arise troIn fraud or error and are considered material if. individuallv or in the augreuat. 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 wkith Sri Lanka Auditin, Standards. I exercise professional judgirent 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 responsiv e to those risks. and obtain audit c idence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resultino from fraud is higher than for one resulting from error. as fraud may invol%e collusion. foraery. 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 Project's internal control. * Evaluate the appropriateness of accounting policies used and the reasonableness of accountin estimates and related disclostires made by the management. * Evaluate the overall presentation. structure and content of the financial statements. including the disclosures, and w\hether the inancial statements represent the underlying transactions and events in a manner that achieves fair presentation, I communicate with those charged wvith governance regarding, among other matters, siunificant audit findings. including any significant deticiencies in internal control that I identitv durin my audit. 3 r N et) \l l Dm i> IC 2. Report on Other Requirements of the Donor Agency As required by the International Bank for Reconstruction and Developient. I state the followingls:, (a) The basis of opinion of the audit is as stated above. (b) In mv opinion: - the funds provided had been utilized for the purposes for \ hich they were provided. - the opening and closing balances, vithdrawals form and replenislcnts to the Special (Dollar) Account had been trulv and fairly- disclosed in the books and recorls maintained by the Project and the balance as at 3 1 December 201 9 had been satisfactorily reconciled with the accounting records of the Central Bank of Sri 1.anka as at that date. - the Statements of Expenditure submitted could be fairly relied upon to support the application fOr reimbursement in accordance with the requirements specified in the Grant Agreement. - the financial covenants laid dow\n in the Grant Agreement had been complied with. W.P.C.Wickramarathne Auditor General 4