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Ref. No.-2073/74                                                    Date March 10, 2017
INDEPENDENT AUDITOR'S REPORT
The Secretary
Ministry of Finance
Singh Durbar, Kathmandu
Report on the Financial Statements
We have audited the accompanying Project Financial Statements including Statement of Designated
Account of the "Bridge Improvement and Maintenance Program" financed by IDA Credit No 5138 NEP
as at 15 July 2016 (31stAshad, 2073) and for the year then ended and a summary of accounting policies
and other explanatory notes.
Management's Responsibility for Financial Statements
Management is responsible for the preparation and fair presentation of the Financial Statements in
accordance with the Government of Nepal (GON) accounting policies and relevant practices. This
responsibility included designing, implementing and maintaining internal control relevant to preparation
and fair presentation of financial statements that are free from material misstatement, whether due to
fraud and error.
Auditor's Responsibility
Our responsibility is to express an opinion of these Project Financial Statements based on our audit. We
conducted our audit in accordance with the INTOSAI (International Organization of Supreme Audit
Institutions) Fundamental Auditing Principles. Those principles require that we plan and perform the
audit to obtain reasonable assurance about whether 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 entity's internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, 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 audit opinion.


Opinion
Management letter highlighting areas for im  v    iaj$ anagement including compliance with
financial covenant is attached herewith.  the Au
In our opinion, the Project Financial Statements intluding Statement of Designated Account, in all
material respects, give a true and fair view of the financial position of the "Bridge Improvement and
Maintenance Program" as of 16th July 2016 (31stAshad 2073), and of the results of its operations and its
cash flows for the year then ended in accordance with GON accounting policies. We also report that
funds provided under IDA Credit No 5138 NEP has been utilized for intended purposes.
Iswar Nepal
Deputy Auditor General