Ministry of Finance of the Kyrgyz Republic
Ministry of Agriculture,
Food lndustry and Land Reclamation of the Kyrgyz Republic
lntegrated Dairy Productivity lmprovement Project (lDPlP)
credit No. 5918-KG from the lnternational Development Association
Grant No. D147-KG from the lnternational Development Association
INDEPENDENT AUDITORS' REPORT
AND SPECIAL PURPOSE PROJECT FINANCIAL STATEMENTS
For the years ended 31 December 2019 and 31 December 2018
CONTENTS
Page
ndependent Auditors' Report
I 3-4
Special Purpose Project Statements of Financial Position 5
Special Purpose Project Statements of Sources and Uses of Funds 6
Special Purpose Project Statements of Project Activities 7
Special Purpose Project Statements of Special Accounts I
Notes to the Special Purpose Project Financial Statements 9-14
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND M]NISTRY OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ REPUBLIC
INTEGRATED DAIRY PRODUCTTVITY IMPROVEMENT PROJECT (lDPlP)
CREDIT NE 5918-KG AND GRANT N9 D147.KG
SPECIAL PURPOSE PROJECT STATEMENTS OF FINANCTAL POSITION
AS AT 31 DECEMBER 2019 AND 31 DECEMBER 2018
(Expressed in US dollars)
Note 2019 201 I
ASSETS AND CUMULATIVE EXPENDITURE
Cash at bank 195,617 293,322
Cumulative expenditures:
Grant No. D147-KG 953,009 218,747_
Credit No. 5918-KG _ 503,194
TOTAL ASSETS AND CUMULATIVE
EXPENDITURE ____l'6l],q?g- 512,069
SOURCES OF FUNDS
Project financing:
Grant No. O147-KG 992,048 312,154
775,000 200,000
Credit No. 5918-KG
Revolving Fund Account (114,962)
(271) (e0)
Amounts paid on account
5 5
Accumulated foreign exchange difference
TOTAL FUNDS 1.651.820 512,069
CLMU Director Finance Manager
CLMU under the Ministry of CLMU under the Ministry of
Finance of the KYrgYz RePublic Finance of the KYrgYz RePublic
project financial
The notes set out on pages 9-14 form an tntegral part of these special purpose
statements
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLTC AND MINISTRY OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ REPUBLIC
INTEGRATED DATRY pRODUCTtVtTy TMpROVEMENT pROJECT (tDptp)
CREDIT Ne 5918-KG AND GRANT Ns D147-KG
SPECIAL PURPOSE PROJECT STATEMENTS OF SOURCES AND USES OF FUNDS
FOR THE YEARS ENDED 31 DECEMBER 2019 AND 31 DECEMBER 2018
(Expressed in US dollars)
2019 2018 Cumulative
OPENING BALANCES
Grant No. D147-KG 93,322
Credit No. 5918-KG 200,000
TOTAL OPENING BALANCES ______293,322_
ADD: FUNDS RECEIVED BY SOURCES
Grant No. 0147-KG 679,894 312,154 992,048
Credit No. 5918-KG 575,000 200,000 775,000
TOTAL FUNDS RECEIVED __u54,894_ ____j131_91_ __J_J_67_p48_
ADD/(LESS):
Grant No. D147-KG
Revolving Fund Account (114,e62) - (114,962)
Amounts paid on account 21 (eo)- (6e)
Credit No. 5918-KG
Amounts paid on account (202)_ (202)
Foreign Exchange Difference 5
LESS: EXPENDITURE
Grant No. Dl47-KG
Strengthening public and private services in
the dairy sector 1 10,348 40,966 151,314
lncrease in on-farm productivity 393,732 3,694 397,426
lnvestments at the farm level 5,002 6,047 11,049
Project Management 225,180 168,040 393,220
734,262 218,747 953,009
Credit No. 5918-KG
Strengthening public and private services in
the dairy sector 49,998 49,998
lncrease in on-farm productivity
lnvestments at the farm level 453,079 453,079
Project Management 117 117
503,194 503,1 94
TOTAL EXPENDITURE ____1_237-'455_ 218,747 1,456,203
CLOSING BALANCE
Grant No. D147-KG 38,975 93,322
Credit No.5918-KG 156,642 200,000
TOTAL CLOSING _19!fl_z_ ____293322_
Mrs. Bermet Musakozhoeva Mrs. Mekhriban Davlesova
CLMU Director Finance Manager
CLMU under the Ministry of CLMU under the Ministry
Finance of the Kyrgyz Republic Finance of the Kyrgyz Republic
The notes set out on pages 9-14 form an integral part of these special purpose project financial
statements
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ REPUBLIC
TNTEGRATED DATRY PRODUCTIVITY IMPROVEMENT PROJECT (lDPlP)
CREDIT Ne 59.18-KG AND GRANT NS Dl47-KG
SPECIAL PURPOSE PROJECT STATEMENTS OF PROJECT ACTIVITIES
FOR THE YEARS ENDED 31 DECEMBER 2019 AND 31 DECEMBER 2018
(Expressed in US dollars)
For the year ended 31 December 2019
Project ComponenUActivity Grant No. Credit No.
D147.KG 5918-KG Gumulative
Strengthening public and private services in
the dairy sector 151,314 49,998 201,312
lncrease in on-farm productivity 397,426 397,426
lnvestments at the farm level 11,049 453,079 464,128
Project Management 393,220 117 393,337
Total Project Expenditure _____lllr99_ __- 1A5s203-
-_-!glllt_
For the year ended 31 December 2018
Grant No. Credit No.
Project ComponenUActivity
D147-KG 5918-KG Gumulative
Strengthening public and private services in
the dairy sector 40,966 40,966
lncrease in on-farm productivity 3,694 3,694
lnvestments at the farm level 6,047 6,047
Project Management '168,040 168,040
Total Project Expenditure _____43L47_ 218,747
Mrs. Bermet Musakozhoeva Mrs.Mekhriban
CLMU Director Finance Manager
CLMU under the Ministry of CLMU under the Ministry of
Finance of the Kyrgyz Republic Finance of the Kyrgyz Republic
The notes set out on pages 9-14 form an integral part of these special purpose project financial
statements
MIN]STRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY
OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ REPUBLIC
(lDPlP)
TNTEGRATED DAI RY PRODUCTIVITY IMPROVEMENT PROJECT
CREDIT NE 5918-KG AND GRANT NE D147.KG
SPECIAL PURPOSE PROJECT STATEMENTS OF SPECIAL ACCOUNTS
2018
FOR THE YEARS ENDED 31 DECEMBER 2019 AND 31 DECEMBER
in US dollars
Grant No. Credit No.
D147.KG 5918-KG Total
Balance as at 1 December 2018
Add:
312,154 200,000 512,154
Project funds received
Less:
(218,747) (218,747)
Project eligible exPenditure 5
5
Foreign eichange difference gain/ (loss), net (e0)
(s0)_
Amounts Paid on account
93,322 200,000 293,322
Balance as at 31 December 2018
Add:
679,894 575,000 1,254,894
Project funds received
Less: (1,237,456)
(734,262)_ (503,1e4)
Project eligible exPenditure (114,962)
(114,962)
Revolving Fund Account
21 (202\ (181)
Amounts Paid on account
Balance as at 31 December 2019 38,975 156,642 195'617
Mrs.Mekhriban
Finance Manager
CLMU Director the MinistrY of
CLMU under the Ministry of CLMU under
Finance of the KYrgYz RePublic
Finance of the KYrgYz RePublic
g-14 form an integral part of these special purpose project financial
The notes set out on pages
MTNISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATTON OF THE KYRGYZ REPUBLIG
TNTEGRATED DAIRY PRODUCTIVTTY IMPROVEMENT PROJECT (lDPlP)
CREDIT NS 5918.KG AND GRANT Ng D147.KG
NOTES TO THE SPECIAL PURPOSE PROJECT FINANCIAL STATEMENTS
AS AT AND FOR THE YEARS ENDED 31 DECEMBER 2019 AND 31 DECEMBER 2018
(Expressed in US dollars)
1. BACKGROUND
ln accordance with the Financing agreement for Grant No. D-147-KG and Credit No. 5918-KG dated 10
"lDA"), Kyrgyz
August 2017 between Kyrgyz ne-pudtic and the lnternational Development Association (the
Ref,ublic has receiveO ini Uetow listed funds for the lntegrated Dairy Productivity lmprovement Project
(the "Project").
The project is executed by Ministry of Finance of the Kyrgyz Republic and Ministry of Agriculture, Food
tnOustry and Land Recllmation of the Kyrgyz RepuOiic (the "Project Executing Agencies") and
imptementeO by CLMU - Credit Line Manageheht Unit - a group of Project employees created
under the
Ministry of Finance of the Kyrgyz Repub-iic with the aim of fulfilling the disbursement and financial
,"nagLrent functions ot tne w[6te project abd implementation of Components 3 and 4b of the Project;
aim of fulfilling the procurement functions
anO n-gCC - Agribusiness Competitiveness Center with the
and implementation of Components 1,2 and 4a of the Project'
58a, r. 302'
The tegaladdress of the CLMU is 720040, Kyrgyz Republic, Bishkek City, Erkindik blvd.,
quality on Beneficiary
The objective of the the project is to enhance dairy animal productivity and milk
Farms.
The Components of the Project are.
o Strengthening public and private services in the dairy sector;
. lncrease in on-farm productivity;
o lnvestments at the farm level; and
o Project management support to lDPlP.
Below stated details of funding financial agreements of the Project:
Note Amount of SDR Amount of USD
lnternational Development Association
Grant No.D-147-KG A 1,700,000 2,250,000
Credit No.5918-KG B 2,000,000 2,750,000
Republic and
The Financing agreement for Grant No. D-147-KG and Loan No, 5918-KG between Kyrgyz
Association was signed on 10 Augusl2OlT (the "Financial agreement").
the lnternational Development
A. The financing of Grant No. D-147-KG is implemented through the following categories:
Total
amount Total amount
allocated for allocated for Basis for
IDA IDA withdrawal
Financing, Financing, from the Grant
SDR USD account
Goods, works, non-consulting
-1
services, consultants' services,
1,700,000 2,250,00 00%
training and incremental operating
cost for the Project
Total 1,700,000 2,250,000
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY
OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ
REPUBLIC
TNTEGRATED DAIRY PRODUCTIVITY IMPROVEMENT PROJECT
(lDPlP)
CREDIT N9 5918.KG AND GRANT N9 D147.KG
(CONTINUED)
NOTES TO THE SPECIAL PURPOSE PROJECT FINANCIAL STATEMENTS
DECEMBER 2019 AND 31 DECEMBER 2018
AS AT AND FOR THE YEARS ENDED 31
(Expressed in Ut lg]!tt)
1. BACKGROUND (CONTINUED)
categories
B. The financing of Loan No 5918-KG is implemented through the following
Total
amount Total amount Basis for
allocated for allocated for withdrawal
IDA IDA from the
Financing, Financing, Grant
SDR USD account
Goods, works, non-consulting services,
consultants' services, training and 560,000 750,000 100o/o
incremental operating cost for the
Project
1,440,000 2,000,000 100%
Sub-financing
Total -- 2poopoo 2,750,000
2. SIGNIFICANTACCOUNTINGPOLICIES
2.'l Statement of comPliance
maintains separate books and
CLMU of the tntegrated Dairy Productivity lmprovement Project.(lDPlP)
on the'project following lnternational Public sector
records by funding source for all expenditures incurred
Accounting Standards (l PSAS).
accordance with the cash
These special purpose project financial statements have been prepared in
to applicable to these special purpose
basis of accounting ,no tnl Financial agreements, the extend
Government of Kyrgyz
project financial statements and as agreeo by the. iroject Executing Agency, the
Reiublic and lnternational Development Association'
2.2 Period of accounts
These special purpose financial statements cover the years ended
31 December 2019 and
31 Decembet2018.
2.3 Transactions and balances in foreign currencies
is the Kyrgyzstan Som
The nationalcurrency of the Kyrgyz Republic, where the Project is implemented,
dollar' All financial
(.KGS,). The speciaf puiposti [ioject'financial statements are presented in US
dollar'
information presented in US Oottar has been rounded to the nearest US
other than
ln preparing the special purpose project financial statements, transactions in currencies
Bank of Kyrgyz Republic
presentation currency are'recorded at-the exchange rates defined by Central
and payment.
iocal commercial bank prevailing on the date of receipt
exchange rates are not cash
unrealised gains and losses arising from changes in foreign currency
on cash-held in a foreign currency
receipts and payments. However, th6 effect of exlhange rateihanges
is reported in the special purpose project statement of sources ind uses of funds and other special
purpose project statements in order to reconcile cash at the beginning and
the end of the period' These
payments Lnd include the differences' if any'
amounts are presented separately from cash receipts and
reported at end-of-period exchange rates'
had those cash receipts and payments and balances been
10
AND
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY OF AGRICULTURE
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ
REPUBLIC
DATRY PRODUCTIVITY IMPROVEMENT PROJECT (lDPlP)
INTEGRATED
CREDIT NE 5918.KG AND GRANT NS D147.KG
(CONTINUED)
NOTES TO THE SPECIAL PURPOSE PROJECT FINANCIAL STATEMENTS
DECEMBER 2018
AS AT AND FOR THE YEARS ENDED 31 DECEMBER 2019 AND 31
(Expressed in US dollars)
2. sIGNIFICANTACCOUNTINGPOLICIES(CONTINUED)
2.4 Sources of funds
procedures for the
The project applies direct payment and replenishment of. designated account are recognised
The funds
contractors through nppr,.rtio* prepared oiseO on supporting documents
paid out by IDA to contractors'
when earned, wnicn is ine date when the funds are directly
"Funds" in the special purposg project statement
The accumulated project financing is disclosed under
in the special purpose
of financial position. ln addition, the current year funds received are disclosed
statement of Project sources and uses of funds'
Project exPenses
Project expenses are recognised on the cash basis of accounting
The accumulated Project expenses
position'
are'disclosed in the speciai-purpose project statement of financial
3. CLOSING DATE OF THE PROJECT
TheProjectisexpectedtobecompletedby31December2020,
11
lr o N (o@l- o @$f- o
o
z
r NN(Y)
(r) $ (t) ': (oo$ $
o)- @- o- O dt
s - r- dco - s oco(o
3 s
@
J o or(oo) (o
9 N CO$Cf) E
E
J
o I
= E (!
o o o
UJ
d
o
z (, @ | O)f'- ol ',,I
Y O) Nr
o)- oF YI
o € o) I
(a ol
z $tr) -l
(')l
o)
lo $
1l
ol
C,
t, z
a =
! , !rl
=l
f o ol
o o ol
I
=
o
o
o (oool
o s qleusEl
I
lr r N$Nl
o v co- $- o_ N_l
I.-lo
Fl
z l'- r
I
(o @l @
t ro \-O
cD
slr (ol
:l
O)-O)
(f) r Cr) -l--lN
t.o
UJ o
ci I
=lu z
"ll
F f o
J
=
,\
d. 6x
z?
:-o
F (\
o
(l, El
=ll I
O oH N
r!
o t 2fi
zo
d E HH
:- ut-
F =
a Fco
2 Ii So
9E b
=i17
z t
e rix
<i o
6a 6o
rl
OO
ds a!
og !
E =E
HgHH ul
Z.s
U EiPS =Eu
o=z
J.1
Hfis
O
Y T;Ef; 8 o, *a @ fla
i '=-'riu,
r! -oAdtr
fr H iEH F eEH
E E€T E
-E EEE
SqEid$ s
o
i:
=
G E
H 3=,E=
EEEg 6 els;
=E,e
d-.s!b I
x gEIE
o
o- aE=E
il
?pE$H= !,
;H6i;x o ; D ; u-l!=
sEEg
byff3Ex ;o
rp|<2?z o 3
HiSEri o o
Ea
o
x
ul $Oo
E3
BEEB= E BEEE E
=y'zE
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY OF AGRICULTURE AND
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ REPUBLIC
TNTEGRATED DAIRY PRODUCTIVITY IMPROVEMENT PROJECT (lDPlP)
CREDIT NE 5918-KG AND GRANT NE D147.KG
(CONTINUED)
NOTES TO THE SPECIAL PURPOSE PROJECT FINANCIAL STATEMENTS
AND 31 DECEMBER 2018
AS AT AND FORTHE YEARS ENDED 31 DECEMBER 2019
in US dollars)
5. PROJECT EXPENDITURES
Betow stated Project cumulative expenditures of Grant No. D-147-K.G as at 31 December 2019
and 31
December 2018 by sources of funds.
Balance of the
Cumulative budget as at 31
2019 Total proiect budget December 2019
USD Yo SDR USD USD %
Goods, works, non-consulting
services, consultants' services, 953,009 42% 1,700,000 2,250,000 1,296,991 s80k
training and incremental
operating cost for the Project
Total 953,009 420/o 1,700,000 2,250,000 1,296,991 58%
Balance of the
Cumulative budget as at 31
2018 Total project budget December 2018
USD YO SDR USD USD %
Goods, works, non-consulting
services, consultants' services, 218,747 100/o 1,700,000 2,250,000 2,031,253 90%
training and incremental
operating cost for the Project
Total 21314r_J9%_ J9o,q9!--?,290,99q- -2ptt-,zx--3ou-
2019 by sources
Below stated project cumulative expenditures of Credit No. 5918-KG as at 31 December
of funds:
Balance of the
Cumulative budget as at 31
2019 Total oroiect budqet December 2019
USD YO SDR USD USD Yo
Goods, works, non-consulting
services, consultants' services, 50,115 7% 560,000 750,000 699,885 93Yo
training and incremental
operating cost for the Project
453,079 230/0 1,440,000 2,000,000 1,546,921 77o/o
Sub-financing
Total 503.194 18Yo 2,000,000 2,750-000 2,246,806 82%
13
AND
MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC AND MINISTRY OF AGRICULTURE
FOOD INDUSTRY AND LAND RECLAMATION OF THE KYRGYZ REPUBLIC
(!DPIP)
TNTEGRATED DAIRY PRODUCTIVITY IMPROVEMENT PROJECT
CREDIT NS 5918-KG AND GRANT NE D147-KG
(coNTINUED)
r,tOfeS TO THE SpeClel PURPOSE PROJEcT FtNANcIAL STATEMENTS
2018
AS AT AND FOR THE YEARS ENDED 31 DECEMBER 2019 AND 31 DECEMBER
(Expressed in US dollars)
6. COMMITMENTS AND CONTINGENCIES
Management is not aware of any commitments and contingencies which would have a material impact
onthiJspecialpurposeprojectfinancialstatementsasat3l December2019and31 December20lSand
for the years then ended.
7. OPERATINGENVIRONMENT
The project's principal activities are within Kyrgyz Republic. Consequently, the Project is exposed to
market'
economic and financial markets of Kyrgyz nepuOtic, which display characteristics of an emerging
The legal, tax and regulatory frameworks continue development, but are subjectto varying interpretations
and fr6quent changes whith together with the other legal and fiscal impediments contribute to the
project financial
chaltenges faced 5y entities o[erating in Kyrgyz nepuOtic. The special purpose
statements reflect management;s asselsmeni of the impact of the operating environment in Kyrgyz
Republic on the opera[ions of the Project. The future operating environment may differ from
management's assessment.
8. POST BALANCE SHEET EVENTS
A certain impact on the implementation of the project had spread of virus COVID-19 in the
country The
ongoing crisis is expected io affect the implementation of the Project in the 2020.
14