CENTRAL STATISTICAL ORGANIZATION (CSO) IRAQI HOUSEHOLD SOCIOECONOMIC SURVEY AWARD NO. I3RF GRANT NUMBER TF0B6645 STATEMENT OF CASH RECEIPTS AND PAYMENTS FOR THE PERIOD FROM INCEPTION ON MARCH 29, 2022 TO DECEMBER 31, 2023 TOGETHER WITH INDEPENDT AUDITORS’ REPORT CENTRAL STATISTICAL ORGANIZATION (CSO) IRAQI HOUSEHOLD SOCIOECONOMIC SURVEY AWARD NO. I3RF GRANT NUMBER TF0B6645 FOR THE PERIOD FROM INCEPTIONOM ON MARCH 29, 2022 TO DECEMBER 31, 2023 Table of contents Page Project Details 1 Independent Auditors’ Report 2-3 Statement of Cash Receipts and Payments 4 Notes to the Statement of Cash Receipts and Payments 5-6 CENTRAL STATISTICAL ORGANIZATION (CSO) IRAQI HOUSEHOLD SOCIOECONOMIC SURVEY AWARD NO. I3RF GRANT NUMBER TF0B6645 FOR THE PERIOD FROM INCEPTION ON JANUARY 1, 2023 TO DECEMBER 31, 2023 Project Details Project Title: Iraq Household Socioeconomic Survey Donor: International Bank for Reconstruction and Development Recipient: Central Statistical Organization (CSO) Independent Auditors: KPMG– Kawasmy & Partners (Kurdistan/Erbil) Gullan street, Italian village (1), villa 419 Grant Agreement Reference: Award No: I3RF GRANT NUMBER TF0B6645 Total Project Budget: Component Budget 3,410,000 USD Project Period Duration: From Inception on March 29, 2022 to December 31,2023 1 Independent Auditors’ Report TO THE MANAGEMENT OF KURDISTAN REGION STATISTICS OFFICE (KRSO) ERBIL – IRAQ FOR THE PERIOD FROM INCEPTION ON MARCH 29, 2022 TO DECEMBER 31,2023 Opinion We have audited the statement of cash receipts and payments “the Statement” of the Central Statistical Organization (CSO) Award No. 13RF, “the Project” for the period from inception on March 29,2022 to December 31, 2023, (“The period”) and notes to the statement, comprising significant accounting policies and other explanatory information. In our opinion, the accompanying financial statement of the period is prepared, in all material respects, in accordance with International Public Sector Accounting Standard (IPSAS) "Financial Reporting under the Cash Basis of Accounting". Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statement section of our report. We are independent of the Project in accordance with International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code) together with the ethical requirements that are relevant to our audit of the financial statements in the Republic of Iraq, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Emphasis of Matter - Basis of Accounting and Restriction on Use and Distribution We draw attention to note (3) to the statement which describes the basis of accounting. The statement is prepared to adequately reflect the cash receipt and disbursement of the project, as a result , the statement may not be suitable for statutory filing or any other purpose. Our report is intended solely for the management use of Central Statistical Organization (CSO) and should not be distributed or used by any other parties. Our opinion is not modified in respect of this matter. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statement in accordance with International Public Sector Accounting Standard "Financial Reporting under the Cash Basis of Accounting", and for such internal control as management determines is necessary to enable the preparation of the financial statement that is free from material misstatement, whether due to fraud or error. In preparing the financial statement, management is responsible for assessing the Project’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Project or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Project’s financial reporting process. 2 Independent Auditors’ Report TO THE MANAGEMENT OF CENTRAL STATISTICAL ORGANIZATION (CSO) BAGHDAD - IRAQ FOR THE PERIOD FROM INCEPTION ON MARCH 29, 2022 TO DECEMBER 31,2023 Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statement as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial statement. As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the financial statement, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, 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 accounting estimates and related disclosures made by Central Statistical Organization (CSO) Management. • Conclude on the appropriateness of management’s use of the going concern basis of accounting and based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Project’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statement or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Project to cease to continue as a going concern. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. KPMG Erbil - Iraq January 24, 2025 3 CENTRAL STATISTICAL ORGANIZATION (CSO) IRAQ HOUSEHOLD SOCIOECONOMIC SURVEY AWARD NO. I3RF GRANT NUMBER TF0B6645 STATEMENT OF CASH RECEIPTS AND PAYMENTS For the Period from inception on March 29,2022 to In US Dollar Note December 31, 2023 Cash Receipts World bank direct payments 4 9,779 Advance into designated account 5 1,000,000 Total cash receipts 1,009,779 Cash Payments Consultant services (9,779) Operating cost (10,087) Total cash payments (19,866) Excess of cash receipts over cash payments at the end of the period 989,913 The notes on pages from (5) to (6) are an integral part of this Statement of Cash Receipts and Payments The Statement was approved by management on January 24, 2025 Project Manager Qusay Abdulfattah Raoof 4 CENTRAL STATISTICAL ORGANIZATION (CSO) IRAQ HOUSEHOLD SOCIOECONOMIC SURVEY AWARD NO. I3RF GRANT NUMBER TF0B6645 NOTES TO THE STATEMENT OF CASH RECEIPTS AND PAYMENTS 1. INTRODUCTION According to the agreement signed between the Government of Iraq (GOI) and International Bank for Reconstruction and Development (IBRD), The Governement of Iraq agreed to receive financing the amount of US$ 3.41 million (I3RF) from the World bank to implement the IHSES III in the 15 governorates of the federal Iraq. It covers the support to CSO in preparation of the survey including and not limited to piloting and pre-testing, conducting trainings for master trainers, enumerators and field supervisors, printing and translation of questionnaire, survey manuals etc. and acquiring goods and services needed to implement the survey. 2. PROJECT INFORMATION Central Statistical Organization (CSO) has been awarded a grant of 3,410,000 USD from the International bank for reconstruction and development to support the Government of Iraq to collect quality data to produce poverty estimates and other key demographic and socioeconomic indicators to inform evidence-based policymaking. The project will aid the Central Statistical Organization (CSO) in preparation and implementation of the third round of the Iraq Household Socioeconomic Survey (IHSES III). The implementing agencies are the Central Statistical Organization (CSO) in Baghdad under their central and regional Ministries of Planning (MoP), respectively. They are responsible for producing the national and regional statistics and coordination of the statistical work across government agencies. CSO is currently forming their project management teams (PMTs). The CSO’s PMT is expected to include one each of financial management, procurement, environment, and financial officers. It will also have a project manager, a data manger, and the head of the CSO will steer the team. Similarly, the CSO’s PMT is expected to be headed by the Director General of Technical Affairs and include officers for procurement, financial, environment and social, administrative, and grievance. The PMTs will be charged with implementing the project activities, guaranteeing compliance with the world bank Government of Iraq requirements and ensuring achievement of the Project Development Objectives. They will manage the day-to-day activities of the project, supervise the technical quality of the project, and responsible for ensuring reporting and documentation that are consistent with the world bank standards. The Central Statistical Organization (CSO) is responsible for data collection of IHSES in the governorates of Iraq and implements the survey in the rest of the governorates of Iraq. The project is structured as such into the following: - IHSES III Iraq CSO (USD 3,410,000) This component will support the Central Statistical Organization (CSO) to implement the IHSES III in the 15 governorates of the federal Iraq. It covers the support to CSO in preparation of the survey including and not limited to piloting and pre-testing, conducting trainings for master trainers, enumerators and field supervisors, printing and translation of questionnaire, survey manuals, and acquiring goods and services needed to implement the survey. In addition, the grant will support the survey field work – transportation, remuneration for field enumerators and supervisors, and other operation needs –, auditing, and data processing for analysis of results. The Implementing Agencies are the Central Statistical Organization (CSO) in Baghdad and the Central Statistical Organization (CSO) in Erbil under their central and regional Ministries of Planning (MoP), respectively. They are responsible for producing the national and regional statistics and coordination of the statistical work across government agencies. The major part of the expenditures will fall under the remuneration part, related to the enumerators and field supervisors and their related operating costs. The part pertaining to Goods is a small package of IT equipment and other related equipment, required for the data processing. The Goods shall not exceed 10% of the total value of the project. 5 CENTRAL STATISTICAL ORGANIZATION (CSO) IRAQ HOUSEHOLD SOCIOECONOMIC SURVEY AWARD NO. I3RF GRANT NUMBER TF0B6645 NOTES TO THE STATEMENT OF CASH RECEIPTS AND PAYMENTS 3. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES A) Statement of compliance The statement of cash receipts and payments (the “financial statement”) have been prepared in accordance with International Public Sector Accounting Standard "Financial Reporting under the Cash Basis of Accounting". The cash basis of accounting recognizes transactions and events only when cash (including cash equivalents) is received or paid by the project. The statement of cash receipts and payments was authorized for issue in accordance with the management approval on January 24, 2025. B) Basis of measurement The statement of cash receipts and payment has been prepared on cash basis of accounting which recognizes transactions and events only when cash (or cash equivalents) is received or paid by the project. Cash equivalents are defined as short-term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value. C) Reporting and Functional Currency The financial statement has been presented in united states dollars (USD) which is different from the currency of country where the CSO is domiciled which is the Iraq dinar due to the fact that most of the transactions are denominated in USD Dollars Summary of significant accounting policies Cash receipts Cash receipts are recorded when funds are deposited in the CSO bank accounts. These represent fund received from the world bank. Cash payment Cash payments are recorded when funds are transferred from CSO bank account. These represent payments for various activities inline with grant agreement. 4. WORLD BANK DIRECT PAYMENTS These amounts are directly paid at the request of the borrower from the world bank to third parties (e.g. Suppliers, contractors or consultants) for eligible expenditures. 5. ADVANCE INTO DESIGNATED ACCOUNT World bank advance loan proceed into designated account of the borrower to finance eligible expenditures as they are incurred, and this account will be reimbursed subsequently from the world bank to cover payments. 6. CASH AND CASH EQUIVALENT The available cash amounted to USD 989,913 has been transferred from the CSO to the Ministry of Finance (MoF) on July 16,2023 in compliance with the MoF circular No. 8295 dated April 27,2023 which requires projects to exchange their foreign currency holdings into Iraqi local currency. On February 4,2024 the MoF has transferred back the amount to CSO bank account in Iraqi Dinar Currency. 6