Promoting Social Inclusion and Self-Reliant Livelihood Activities
in Armenia Project
JSDF Grant No. TFOB2613
IMPLEMENTED BY THE ARMENIAN ASSOCIATION OF SOCIAL WORKERS NGO
Special Purpose Project Financial Statements
and
Independent Auditor's Report
For the period from January 1, 2023 to October 31, 2023
YE REVAN
Dec 2023
JSDF Grant No. TFOB261 3 Promoting Social Inclusion and Self-Reliant Livelihood Activities in
Armenia Project
Table of Contents
STATEMENT OF MANAGEMENT RESPONSIBILITY FOR THE PREPARATION OF THE FINANCIAL
STATEMENTS .........MENTS. .-.. . .. .. 3
INDEPENDENT AUDITOR'S REPORT ..........EPOR. .-
STATEMENT OF CASH RECEIPTS AND PAYMENTSYME6..........6
STATEMENT OF USES OF FUNDS BY PROJECT ACTIVITY ...CTi. ......7
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS . . ERROR! BOOKMARK NOT DEFINED.
ANNEX 1. RECONCILIATION BETWEEN THE AMOUNTS SUBMITTED BY THE AASW AND DISBURSED
BY THE WORLD BANK........ .K..........-.-...13'
STATEMENT OF MANAGEMENT RESPONSIBILITY FOR THE PREPARATION OF THE FINANCIAL
STATEMENTS
The management of the Armenian Association of Social Workers NGO ("AASW") is responsible for the
preparation of the special purpose financial statements for the period from 01 Jan 2023 to 31 Oct
2022 of "Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project"
("Project") financed by JSDF Grant No. TFOB2613 dated 6 May 2020 ("Letter Agreement" or "Letter
Agreement"), in compliance with the International Public Sector Accounting Standard "Financial
Reporting under the Cash Basis of Accounting" (IPSAS-Cash Basis) issued by the International Public
Sector Accounting Standards Board (IPSASB) and the Financial Management Manual for World Bank
Financed Investment Operations (WB Guidelines).
In preparing the special purpose financial statements, AASW's management is responsible for:
.Properly selecting and applying accounting policies;
*Presenting information, including accounting policies, in a manner that provides relevant,
reliable, comparable and understandable information;
-Providing additional required disclosures for the period from 01 Jan 2023 to 31 Oct 2023.
AASW's Management is also responsible for:
* Designing, implementing and maintaining an effective and sound system of internal controls,
throughout the Project;
* Maintaining adequate accounting records that are sufficient to show and explain the Project's
transactions, and which enable them to ensure that the special purpose financial statements
of the Project comply with IPSAS - Cash Basis and the WB Guidelines;
* Taking such steps t20hat are reasonably available to them to safeguard the assets of the
Project and to affirm that funds received have been used in accordance with the Grant
Agreement, and World Bank related guidelines, with due attention to economy and efficiency,
and only for the purposes for which the financing was provided;
* Maintaining the Designated account in accordance with the provision of the Letter Agreement,
and World Bank related guidelines;
* Procuring Goods and Services financed in accordance with the Letter Agreement and World
Bank related guidelines; and
* Preventing and detecting fraud and other errors.
The special purpose financial statements for the period from 01 Jan 2023 to 31 Oct 2023 were
signed on 29 December 2023 by the AASW's Management.
Mira Antonyart Aram Zakaryan_
Chairman Financial Management Consultant
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INDEPENDENT AUDITOR'S REPORT
To the Armenian Association of Social Workers NGO,
Opinion
We have audited the accompanying special purpose financial statements of the "Promoting Social
Inclusion and Self-Reliant Livelihood Activities in Armenia Project" ("the Project") financed by the
JSDF Grant No. TF082613 dated 6 May 2020 ("Grant Agreement" or "Letter Agreement") and
implemented by the Armenian Association of Social Workers NGO ("the AASW"), which comprise the
statement of cash receipts and payments, the statement of uses of funds by Project activity for the
period from 01 Jan 2023 to 31 Oct 2023, and a summary of significant accounting policies and other
explanatory notes.
In our opinion, the special purpose financial statements are prepared in all material respects in
accordance with the cash receipts and payments of the Project for the period from 01 Jan 2023 to
31 Oct 2023 in accordance with International Public Sector Accounting Standard: Financial
Reporting Under the Cash Basis of Accounting, ("IPSAS-Cash Basis"), and Financial Management
Manual for World Bank Financed Investment Operations ("WB Guidelines").
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing ("ISAs") as issued by
International Auditing and Assurance Standards Board ("IAASB"). Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial
Statements section of our report.
We are independent of the Project and AASW in accordance with the International Ethics Standards
Board for Accountants' Code of Ethics for Professional Accountants ("IESBA Code"), and we have
fulfilled out other ethical requirements in accordance with 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- Cash Basis of Accounting
Without modifying our opinion, we draw attention to Note 2 to the financial statements, which
describes those financial statements are prepared in accordance with cash basis framework, as a
result, they may not be suitable for another purposes,
Management's Responsibility for the Special Purpose Financial Statements
The management of the AASW is responsible for the preparation of these special purpose financial
statements in accordance with IPSAS-Cash Basis issued by the International Public Sector Accounting
Standards Board (IPSASB), and WB Guidelines, and for such internal control as management
determines is necessary to enable the preparation of special purpose financial statements that are
free from material misstatements, whether due to fraud or error.
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Auditor's Responsibility for the Audit of the Special Purpose Financial Statements
Our objectives are to obtain reasonable assurance about whether the special purpose 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 our opinion. Reasonable assurance is high level of assurance,
but is not a guaranty that an audit conducted in accordance with ISAs will always detect a material
misstatement when it exists. Misstatements arise from fraud and 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 these special purpose financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
* Identify and assess the risks of material misstatement of the special purpose financial
statements, 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 internal control.
* Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
* Evaluate the overall presentation, structure and content of the special purpose financial
statements, including the disclosures, and whether the special purpose financial statements
represent the underlying transactions and events in a manner that achieves fair
presentation.
We communicate with management 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.
Report on Other Legal Requirements
To comply with the terms of the Letter Agreement, the AASW shall insure that:
1. funds have been used in accordance with the conditions of the Letter Agreement concluded
between the International Bank for Reconstruction and Development (IBRD", "IDA", or
"WB") and the "Armenian Association of Social Workers" Non-Governmental Organization,
and World Bank related guidelines, with due attention to economy and efficiency, and only
for the purposes for which the financing was provided;
2. supporting documents, records and accounts have been maintained to support expenditures
incurred. Expenditures included in the withdrawal applications and reimbursed against are
eligible for financing under the Letter Agreement; Interim Unaudited Financial Reports
(lFRs) issued by Project during the Reporting period are in agreement with the underlying
books of account;
3. The Designated account used have been maintained in accordance with the provision of the
Letter Agreement, and World Bank related guidelines;
4. Goods and Services financed have been procured in accordance with the Letter Agreement
and World Bank related guidelines.
In our opinion, the AAS ed with the above requirements during the period from 01 Jan
2023 to 31 Oct 2023. t 4
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSIDF Grant No. TFOB2613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
1. General information
1. 1. The Project financing
According to Letter Agreement signed on 6 May 2020 between the Armenian Association of Social
Workers NGO and International Bank for Reconstruction and Development/ International
Development Association ("IBRD", IDA", or "W13") acting as administrator of grant funds provided by
Japan under the Japan Social Development Fund ("JSDF"), IBRD provided Grant Number No.
TFOB2613 in the amount of 2,700,000 United States Dollars ("USY).
The Grant was provided for implementation of "Promoting Social Inclusion and Self-Reliant
Livelihood Activities in Armenia" Project ("Project").
The Closing Date is June 30, 2023.
1.2. The Project objective
The objective of the Project is to increase access to social assistance benefits and services and
P1 provide seff-emptoyment support for approximately 11,000 extremely vulnerable individuals in
selected regions of Armenia.
14 The Project consists of the following parts:
Part 1: Development and implementation of a pilot counseling program
(a) Support the revision and improvement of methodology and operational documents required for
IN introducing the social case management system, through inter alia:
0) preparation of a: (a) methodological document to define main concepts, goats, and priority
areas to be addressed by the social case management intervention; and (b) manual, for
social workers to translate social case management methodology in a step by-step process.
IN (ii) provision of revised screening tools for social workers to assess households' In Process
vutnera bi ti ties, including development of a management information system (MIS) to track
and monitor the family progress and effective access of beneficiaries to social assistance
P 1 and exposure to employment programs.
(iii) preparation of revised referral protocols with key service providers that will describe formal
agreements an preferential access for referred beneficiaries and on aR aspects needed for
the development of MIS, including inter alia, arrangements for interoperability among
P 1 providers' own informational systems, protocols for data collection, entry, quality control,
and cross-checking.
(i V) design of an outreach strategy and implementation of the public campaign for social
workers to identify and reach out to the poor and vulnerable households living in their
communities through carrying out public relations and awareness raising activities, such as
social media campaign, video materials production, townhalls and/or informational sessions
targeted to the potential beneficiaries and locat decision makers.
(b) Support training activities for at least 200 state and community social workers in the areas of
social case management skills and the use of manuals and tools prepared under the Project.
Part 2: Capacity building and entrepreneurship support.
(a) Support: business management skills training and coaching for selected Beneficiaries and state
or community social workers; trade fair exhibitions and networking events to promote new business
opportunities; and development of a manual for provision of Sub-grants.
(b) Self-employment support and access to social services, including support for capacity building
activities to selected Beneficiaries, all through the provision of Sub-grants.
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSDF Grant No. TFOB2613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
Part 3: Project management and administration, monitoring and evaluation (M&E), and
knowledge dissemination
Support: (a) Project management and coordination; (b) monitoring and evaluation (MEtE) activities,
including setting-up of a management information system for MEtE, beneficiary assessment, social
workers' evaluation, and baseline and final evaluation study; and (c) knowledge dissemination
activities under the Project.
1.3. The Project Budget and Financing
The Project is financed 100%, inclusive of taxes, by the JSOF Grant No. TFOB2613.
__JSDF Grant No. TF0B2613
Category USD
1) Consu ting Services 427,150
(2) Training __________________ __ 605,050
(3)Goods 85,400
(4) Sub-grants 1,200,000
(5) Operating Costs 382,400
Total amount 2,700,000
1.4. Project Implementation
The Project is implemented by the Armenian Association of Social Workers (AASW),
The AASW is a professional structure which unites social workers and combines the existing
scientific and practical potential in the field. AASW considers its priority task to promote the
formation of a welfare state in Armenia through the development of professional social services.
The AASW registered address is: 64 K. U[netsu Street, Yerevan, 0037, Republic of Armenia.
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSDF Grant No. TFOB2613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
2. Summary of significant accounting policies
2.1. Preparation and presentation of financial statements
The special purpose financial statements are prepared in accordance with the International Public
Sector Accounting Standard: Financial Reporting Under the Cash Basis of Accounting (IPSAS-Cash
Basis), issued by the International Public Sector Accounting Standards Board (IPSASE), and presented
in accordance with Financial Management Manual for World Bank Financed Investment Operations
(March 2010): RM 3 - Financial Reporting and Auditing.
2.2 Cash basis of accounting
The special purpose financial statements are presented using the cash basis of accounting.
Cash basis means a basis of accounting under which transactions and other events are recognized
only when cash or its equivalent is received or paid.
Financial statements prepared under the cash basis provide information about the sources of cash
raised during the period, the purpose for which cash was used and the cash balances at the
reporting date.
2.3 Reporting currency
The Project financial statements are presented in United States Dollars (USD).
2.4 Foreign currency transactions
Foreign currency is a currency other than the reporting currency of the Project.
Project accounts are maintained in USD and Armenian Drams (AMD).
Transactions in foreign currencies are translated to presentation currency at exchange rates at the
dates of these transactions.
2.5. Taxes
Taxes are paid in accordance with the tax regulations of the Republic of Armenia.
2.5. Budget
Annual budgets for funding and expenditures are based on approved budget of the project
agreement.
Expenditure budget is created based on actual accumulated expenditures for the last period plus
the updated procurement plans for the period.
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSDF Grant No. TFOB2613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
3.Summary of Summary Reports and SOEs
in 05D
Expenditure categories
W/A Withdrawal5) Total
W a 1 2) (3) 4)
application Consultmg Training Goods Sub-grants Operating
value date Services Costs
14-ADDA 12-Jun-2023 6,422 36,107 27,376 19,381 89,292
15-ADDA 12-Jun-2023 15.318 47,804 18,133 21,614 102,869
16-ADDA 14-Jun-2023 9,813 3,061 4,362 17,236
17-ADDA 12-Jun-2023 146,878
18-ADDA 05-Oct-2023 24,217 44,679 7,011 4,562 25 106,221
19-ADDA 05-Oct-2023 16,772 104,701 510 34,648 156,631
20-ADDA 17-Oct-2023 80,760 233,749 76,076 69,044 459,629
21-ADDA 23-Oct-2023 15,000 15,000
Total 158,489 476,853 83,087 53,641 174,808 1,093,756
4.Statement of Designated Account
Bank account number 1570065283170100
Bank Ameribank CJSC
Bank location Armenia, 0010, Yerevan Vazgen Sargsyan St., 2 Building, 1st Floor
Currency USD
JSDF Grant No. TFOB2613
Year ended For the period from January 1,2023
31 -Dec-2022 to October 31, 2023
USD USD
1. Opening balance 277,024 607,839
2. Add: opening discrepancy
3. JSDF TF Grant advance/replenishment 2,032,207 146,878
4. Less: Refund to JSDF TF Grant From DA
5. Present outstanding amount advanced to DA 2,309.231 754,717
U 6. DA closing balance 607,839
7. Add: Amount of eligible expenditures paid 1,701,392 754,717
8. Less: interest earned (if credited to DA) -
9. Total advance accounted for 2,309,231 754,717
10. Closing discrepancy (5)-(9) to be explained
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSDF Grant No. TFOB2613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
5.Statement of financial position
The Statement of financial position discloses assets, Liabilities, and net assets of the Project as at
reporting date. This statement is prepared on an accrual basis that is transactions are recognized
when they occur (and not only when cash is received or paid).
For the period from Year ended
January 1, 2023, to December 31,
Note October 31, 2023 2022
USD USD
ASSETS
Cash 6 607,839
Prepayments
Total assets 607,839
LIABILITIES
Payabtes
Total liabilities
NET ASSETS
Cumulative income 8 2,700,000 2,553,122
JSDF Grant No. TFOB2613 2,700,000 2,553,122
Cumulative expenses 2,700,000 1,945,283
Project expenses 7 2,700,000 1,945,283
Foreign exchange gain/(loss)
Total net assets 607,839
6. Cash and cash equivalents
For the period from Year ended
January 1, 2023, to December 31,
October 31, 2023 2022
Account UnderlyingUDUS
held at Currency USD USD
Designated account JSDF Ameriabank USD 607,839
Grant No TFOB2313
Local Account Ameriabank AMD -
Total 607,839
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSDF Grant No. TFOB2613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
7. Project Expenditure budget execution
Cumulative Expenditures as Total budget Execut en
Category at 31 October 2023
USD USD
(1) Consulting Services 423,860 427.150
(2) Training 651,670 605,050 1J6
(3) Goods 3,087 8 5 ,400 97
14) Sub-grants 1,194,553 1,200,000 100
(5) Operating Costs 3 446346,830 382,400 91%
Total 2,700,000 2,700,000 100
The project fully achieved its objectives. The PDO for the project contains of two parts:
Objective 1: increase access to social assistance benefits and services for extremely vulnerab e
individuals in selected regions in Armenia, and
Objective 2: provide self-employment support for extremely vulnerable individuals in selected
regions in Armenia.
Both objectives have been achieved, with all PDls surpassed and no shortcomings in the
achievement of the PDO under the original timeframe and original dates for achieving all targets.
The PDO itself refers to 11,000 beneficiaries (11,683 actual at closing), which is a total for the
interventions under both objectives.
PROJECT MAJOR ACCOMPLISHMENTS
COMPONENT 1: Development and Implementation of a pilot program
COMPONENT 2: Capacity building and entrepreneurship support
COMPONENT 3: Project Management and administration, monitoring, and evaluation (M&E) and
knowledge dissemination
8. Financing JSDF Grant No. TFOB2613
For the period
from January 1, Cumulative as at 31
2023, to October October 2023
31, 2023
USD USD
Advances/ (advance recovery) 146,878 946,878
SOE and Summary Report 1,753,122
Total 146,878 2,700,000
Total financing budget 2,700,000
Percentage of finance provided as at 31
October 2023 100%
9. Litigations
There were no legal cases brought against the Project as at reporting date or as at date of signing
this financial statement.
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Promoting Social Inclusion and Self-Reliant Livelihood Activities in Armenia Project
JSDF Grant No. TF082613
NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS
For the period from 01 Jan 2023 to 31 Oct 2023
ANNEX 1. RECONCILIATION BETWEEN THE AMOUNTS SUBMITTED BY THE AASW AND DISBURSED
BY THE WORLD BANK
For the period from 01 Jan 2023 to 31 Oct 2023 (Amounts are in USD)
Expenditure Category Transfer No Project WB Difference
Advances/advance recovery 17-ADA 146,878 146,878
14-ADDA 6,422 6,422
15-ADDA 15,318 15,318
16-ADDA
CATEGORY 1 Consulting 18-ADDA 24,217 _ 24217 -
Services 18ADA 4,172421
19-ADDA 16,772 16,772 -
20-ADDA 80,760 80,760
21 -ADDA 15,000 15,000 F
Total Category 1 158,489 158,489
14-ADDA 36,107 36,107 -
15-ADDA 47,804 47,804
16-ADDA -- 9,813 9,813 __
CATEGORY 2 Training 1 8-ADDA 44,679 44,679
19-ADDA 104,701 104,701
20-ADDA 233,749 233,749
21-ADDA - -
Total Category 2 476,853 476,853
14-ADDA 7__ ____I___
16-ADDA
CATEGORY 3 Goods 18-ADDA 7,011 7,011
19-ADDA -
20-ADDA 76,076 76,076
Total Category 3 83,087 83,087 -
14-ADDA 27,376 27,376
15-ADDA 18,133 18,133
16-ADDA 3,061 3,061
CATEGORY 4 Sub-Grants 18-ADDA 4,562 4,562 -
19-ADDA 510 510-
20-ADDA -
21-ADDA -
Total Category 4 53,641 53,641
14-ADDA 19,387 19,387
15-ADDA 21,614 21,614
16-ADDA 4,362 4,362 -
CATEGORY 5 Operating Costs 18-ADDA 25,752 25,752 -
19-ADDA 34,648 34,648
20-ADDA 69,044 69,044 -
21-ADDA -
Total Category 5 174,808 174,808
Grand Total 1,093,756 1,093,756 -
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