THE COPPERBELT UNIVERSITY AFRICA CENTRE OF EXCELLENCE FOR SUSTAINABLE MINING (ACESM) PROJECT NO. 5803-ZM ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 CONTENTS PAGES Project information 1 Report of the project management board 2-4 Statement of responsibilities of the board of implementing partner 5 Report of the independent auditor 6-8 Financial statements: Statement of income and expenditure 9 Statement of changes in Funds 10 Statement of financial position 11 Statement of cash flows 12 Notes: significant accounting policies 13 - 21 The following pages does not form an integral part of these financial statements; Actual versus budget analysis 22 - 23 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 ORGANISATION INFORMATION PROJECT PURPOSE : To strengthen African Centres of Excellence to deliver quality post-graduate education and build collaborative research capacity in the regional priority areas MANAGEMENT BOARD : Prof. Imasiku Anayawa Nyambe : Ms. Felicity Nyako Chisanga KEY MANAGEMENT : Mrs. Ruth Mulenga : Dr. Nelly Chunda Mwango PROJECT PROGRAMME COORDINATOR : Dr Mwansa Chabala IMPLEMENTING PARTNER : The Copperbelt University (CBU) : Jambo Drive, Riverside : P.O. Box 21692 : KITWE INDEPENDENT AUDITOR : PKF Zambia : Chartered Accountants : P.O. Box 70998 : NDOLA PRINCIPAL BANKERS : Investrust Bank "in possession" (currently banking with ZICB and ZANACO) 1 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 REPORT OF THE UNIVERSITY COUNCIL The members of the Council submit their report and the audited Financial Statements for the year ended 31 December 2023, which disclose the state of the Project's affairs. PRINCIPAL ACTIVITY The principal activities of the Project is to support the recipient to strengthen selected Eastern and Southern African higher Education Institutions in the Recipients territory to deliver quality post graduate education and build collaborative research capacity in the regional priority areas. The Project consists of the following components: Part 1: Strengthening African Centre of Excellence in Regional Priority Areas Strengthen the capacity of the African Centre of Excellence in Eastern and Southern African Higher Education Institutions, in particular to: a) Build institutional capacity to provide quality post-graduate education with relevance to the labour market. b) Build institutional capacity to conduct high quality applied research, relevant to addressing a key development challenge or priority. c) Develop and enhance partnerships with other academic institutions (national, regional and international) to pursue academic excellence. d) Develop and enhance partnerships with industry and the private sector to generate greater impact. e) Improve governance and management of the institution and set up a role model for other higher education institutions, and f) Deliver outreach, and create an impact to society by delivering excellent teaching and producing high quality applied research. Part 2: Capacity-Building support to Africa Centre of Excellence (ACE) through regional interventions Enhance capacity-building through the IUCEA for the African Centre of Excellence to enable them to perform better, overcome their challenges and achieve their objectives by providing: a) Capacity building on partnership development with the private sector; and b) Competitive scholarships to post-graduate programs in any of the African Centre of Excellence (ACE) Part 3: Facilitation, Coordination and Administration of project implementation Support IUCEA in the preparation, coordination and effective and efficient management of the project. RESULTS FOR THE YEAR 2023 2022 ZMW USD ZMW USD Total grants received 31,991,292 1,471,781 12,427,490 589,385 Other income 49,763 2,474 39,322 2,284 Total projects costs (11,685,815) (937,761) (20,537,953) (1,181,169) Surplus/(deficit) 20,355,240 536,494 (8,071,141) (589,500) CONFIRMATION OF USE OF FUNDS We confirm that the grants received have been spent according to the Agreement. 2 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 REPORT OF THE COUNCIL COUNCIL MEMBERS The University Council was dissolved on 23rd December 2021 and New Council was appointed on 10th April 2023 as follows: Name Designation Ms. Felicity Nyako Chisanga Chairperson Mr. Peter Chasekwa Lukwesa Vice Chairperson Prof. Imasiku Anayawa Nyambe Vice Chancellor Mr. Field Hamalila Member Dr. Ngawo Namukonde Member Dr. Sakumona Mushekwa Member Mr. Amos Mulenga Mumba Member Ms. Ivy B. Dolan Member Mr. Shilambwe Mwaanga Member Mrs. Helen M. Mukumba Secretary MEMBERS OF THE STEERING COMMITTEE The steering committee is mandated to provide guidance and oversight to its selected ACEs during the Project implementation. It oversees the implementation of the ACEs on a regular basis; and receive and review results achievement and expenditure reports. Name Designation Organization represented Dr. Brilliant Habeenzu Permanent Secretary- (Chairperson) Ministry of Technology and Science Mrs. Jane Chinkusu Director Science and Technology (Former/TBA) Ministry of Technology and Science Mrs. Chikatozyo Musonda Director Finance Ministry of Technology and Science Mrs. Miriam Chiyaba Director Zambia Qualification Authority Prof. Orleans Mfune Director-Quality Assurance Higher Education Authority Mr. Sunday Chikoti Director Ministry of Commerce Trade and Industry Mr. Develias Kamulete Budgets Ministry of Finance & National Planning Dr. Kasase Chitundu Chief Executive Officer National Technology Business Centre Mr. Filipo Zulu Acting Executive Secretary National Science & Technology Council Prof. Imasiku Anayawa Nyambe Vice Chancellor The Copperbelt University Prof. Anne Lungowe Sikwibele Vice Chancellor (Acting) The University of Zambia Mrs. Khondwani Mutekesha Assistant Director Planning Ministry of Science and Technology Mrs. Glenda M. Kasonde Representative Chamber of Mines Mr. Elvin Nasilele Chief Executive Officer Zambia Chamber of Commerce and Industry Mr. Amos Mumba Director University Education Ministry of Education Dr. Mwansa Chabala- Ex official Centre Leader -ACESM Copperbelt University Prof. Bernard Hang’ombe- Ex official Centre Leader-ACEIDAH The University of Zambia Mr. John Chongo Lukonde Assistant Director Science Ministry of Technology and Science Mrs. Chilambwe M. Moonga Snr Science & Technology Officer Ministry of Technology and Science 3 p THE COPPERBEL T UNIVERSITY Africa C~ntre of Excellence for Sustainable Mining (ACESM) International Developmen t Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 REPORT OF THE COUNCIL EVENTS AFTER THE REPORTING PERIOD As at 27th March 2024, the Copperbelt University Council approved the sustainability plan for the Copperbelt University - Africa Centre of Excellence in Sustainable Mining (ACESM). Additionally, all bank balances held at lnvestrust Bank Pie "in possession "currently banking with ZICB and ZANACO. INDEPENDENT AUDITOR The independent auditor for the period was PKF Zambia Chartered Accountants. MSFECl~------ PROFESSOR IMASIKU ANAYAWA NYAMBE UNIVERSITY COUNCIL CHAIRPERSON VICE CHANCELLOR KITWE THE COPPER BELT UNIVERSITY Africa C~ntre of Excellence for Sustainable Mining (ACESM) International Development Association (/DA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 STATEMENT OF RESPONSIBILITIES OF THE BOARD OF IMPLEMENTING PARTNER It is the responsibility of Council members to prepare Financial Statements for each financial year which give a true and fair view of the state of affairs of the Project as at the end of the financial year and of the surplus or (deficit) for that year. Council members are also required to ensure that the project maintains proper accounting records that disclose, with reasonable accuracy, the financial position of the Project. Council members are also responsible for safeguarding the assets of the Project. Council members accept responsibility for the preparation and fair presentation of Financial Statements that are free from material misstatement whether due to fraud or error. Council members also accept responsibility for: i. Designing, implementing and maintaining such internal control as they determine is necessary to enable the preparation of Financial Statements that are free from material misstatement, whether due to fraud or error; ii. Selecting and applying appropriate accounting policies; and iii. Making accounting estimates and judgements that are reasonable in the circumstance. Council members are of the opinion that the 2023 Financial Statements give a true and fair view of the financial position of the Project as at 31 December and of the Project's financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards for small and medium sized entities (IFRS for SMEs), as modified by the Memorandum of Agreement with IDA, set out in accounting policies set out on pages 13 to 16. Approved by Council members on 9Jf,/t..~/xi 2024 signed on its behalf by: PROFESSOR I ASIKU ANAYAWA NYAMBE MS FELICI VICE CHANCELLOR UNIVERSITY COUNCIL CHAIRPERSON 5 lii+l:11 PKF Zambia Chartered Accountants Sable House Sackville House Compensation House, 4th Floor 11 Sable Road, Kabulonga Akapelwa Street Broadway Road P.O. Box 31290 P.O. Box 60050 P.O. Box 70998 Lusaka, Zambia Livingstone, Zambia Ndola, Zambia +260 211 267115/119 +260 213 321476/320767 +260 212 610297-8/+260 954 560461 adminlusaka@zm.pkf.com adminlivingstone@zm.pkf.com adminndola@zm.pkf.com Report of the independent auditor to the members of the Copperbelt University African Centre of Excellence for Sustainable Mining (ACESM Project) Opinion We have audited the financial statements of the Copperbelt University African Centre of Excellence for Sustainable Mining (ACESM Project), which comprise the statement of financial position as at 31 December 2023, and the statement of income and expenditure, statement of changes in funds and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Project as at 31 December 2023, and of its financial performance and cash flows for the year then ended in accordance with the International Financial Reporting Standards for Small and Medium Sized Entities (IFRS for SMEs). 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 Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Project in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to our audit of the financial statements in Zambia, 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 Without qualifying our opinion, we draw attention to note 2 of the financial statements, which describes the conclusion of (CBU ACESM) Project. According to the project operations manual (POM), the 5-year project came to an end on 31 December 2023 under the management of Africa Centre of Excellence for Sustainable Mining (ACESM). Other information The Council members are responsible for the other information. The other information comprises the Council members’ report, the schedule of operating expenditure but does not include the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. 6 Partners: Antony Ranjan (Managing Partner), Steven Chibwe, Simon Njelemba, Thulile Kavimba Mumba, Musonda M. Kambikambi PKF Zambia Chartered Accountants is a member of PKF Global, the network of member firms of PKF International Limited, each of which is a separate and independent legal entity and does not accept any responsibility or liability for the actions or inactions of any individual member or correspondent firm(s). Report of the independent auditor to the Council members of the Copperbelt University African Centre of Excellence for Sustainable Mining (ACESM Project) (continued) Responsibilities of Council members for the Financial Statements The Council members are responsible for the preparation of the financial statements that give a true and fair view in accordance with IFRS for SMEs, and for such internal control as the Council members determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Council members are 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 the Council members either intend 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. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are 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 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 these financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:  Identify and assess the risks of material misstatement of the 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 project’s internal control.  Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Council members.  Conclude on the appropriateness of the Council’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 auditor’s report to the related disclosures in the financial statements 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 auditor’s report. However, future events or conditions may cause the project to cease to continue as a going concern. To ensure continuity and sustainability of the centre’s activities, the centre has to 7 I Report of the Independent auditor tO t he I Council members of the Copperbelt University Afr,can centre Of Excellence for Sustaina ble Mining (ACESM Project) (continued) Auditor's Respon SI"bil"f 1 1es for the Audit of the Financial Statements (continued) I university systems and governance structures while maintaining its identity and autonomy. All support functio s will be provided by the university's support � units, ensuring efficient support services without I • burdemng CBU -ACESM 's structure. The governance structure will evolve as the centre becomes sustainable and is able to cover its costs to ensure a broadened scope of operations. Evaluate the overall presentation, structure and content of the financial statements, including the I disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. I 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. I We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that I may reasonat?ly be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit I matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be I communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on Other Legal and Regulatory Requirements I We report to you, based on our audit, that: i) All lDA funds have been used in accordance with the relevant financing agreements. ii) There is no relationship, interest or debt which the Auditor has in the Copperbelt University African Centre of Excellency in Sustainable Mining (ACESM) Project. The engagement partner responsible for the audit resulting In this independent auditor's report is Steve Chibwe, Practising certificate M/PC 0001423. PKFZambia Chartered Accountants Steve Chibwe REF: SC/CBU-ACESM/N0270/2024 8 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 STATEMENT OF INCOME AND EXPENDITURE 2023 2022 Notes ZMW USD ZMW USD INCOME Project grants received 1 31,991,292 1,471,781 12,427,490 589,385 Other income 2 49,763 2,474 39,322 2,284 Total income 32,041,055 1,474,255 12,466,812 591,669 Direct costs 3 (12,382,203) (611,201) (16,992,205) (1,003,662) Other expenses 4 (1,725,025) (109,325) (1,367,617) (80,778) Effects of exchange differences 5 2,421,413 (217,235) (2,178,131) (96,729) Total expenditure (11,685,815) (937,761) (20,537,953) (1,181,169) Surplus/(Deficit) for the year 20,355,240 536,494 (8,071,141) (589,500) The notes on pages 17 to 21 form an integral part of these financial statements Report of the independent auditor - pages 6 to 8. 9 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 STATEMENT OF CHANGES IN FUNDS Note Capital Total Capital Total Grants Funds Grants Funds Year ended 31 December 2023 ZMW ZMW USD USD At start of year As previously stated 28,625,945 28,625,945 1,656,128 1,656,128 Prior year adjustment 11 (566,744) (566,744) (27,979) (27,979) As restated 28,059,201 28,059,201 1,628,149 1,628,149 Revaluation reserve 23,384 23,384 923 923 Total Surplus/(Deficit) for the year 20,355,240 20,355,240 536,494 536,494 At end of year 48,437,825 48,437,825 2,165,566 2,165,566 Capital Total Capital Total Year ended 31 December 2022 Grants equity Grants Funds ZMW ZMW USD USD At start of year 36,697,086 36,697,086 2,245,628 2,245,628 Total Deficit for the year (8,071,141) (8,071,141) (589,500) (589,500) At end of year 28,625,945 28,625,945 1,656,128 1,656,128 The notes on pages 17 to 21 form an integral part of these financial statements Report of the independent auditor - pages 6 and 8. 10 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 STATEMENT OF FINANCIAL POSITION Notes 2023 2022 ASSETS ZMW USD ZMW USD Non Current assets Property, plant and equipment 6 19,437,721 1,040,108 5,411,569 371,933 Intangible assets 7 146,073 11,128 462,726 26,989 19,583,794 1,051,236 5,874,295 398,922 Current assets Trade and other receivables 8 14,181,752 582,709 3,356,039 185,447 Cash and cash equivalents 9 17,336,984 673,090 21,080,528 1,164,864 31,518,736 1,255,799 24,436,567 1,350,311 Total assets 51,102,530 2,307,035 30,310,862 1,749,233 Accumulated funds and liabilities Accumulated funds 48,437,825 2,165,566 28,625,945 1,656,128 LIABILITIES Other liabilities 10 2,664,704 141,469 1,684,917 93,105 51,102,530 2,307,035 30,310,862 1,749,233 The financial statements on pages 9 to 21 were approved and authorised for issue by the Council on ____________ 2024 and were signed on its behalf by: PROFESSOR IMASIKU ANAYAWA NYAMBE MS FELICITY NYAKO CHISANGA VICE CHANCELLOR UNIVERSITY COUNCIL CHAIRPERSON The notes on pages 17 to 21 form an integral part of these financial statements Report of the independent auditor - pages 6 to 8. 11 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 STATEMENT OF CASH FLOWS Note 2023 2022 Cash flows from operating activities ZMW USD ZMW USD Surplus/(Deficit) for the year 20,355,240 536,494 (8,071,141) (589,500) Adjustments for: - Depreciation 6 1,317,129 65,016 979,932 57,880 - Amortization 211,281 34,603 154,242 9,110 - Movements in receivables 8 (10,825,713) (397,262) 11,818,501 723,584 - Movements in payables 10 979,787 48,364 284,225 9,197 - Prior year adjustments 11 2,854 135 - - Net cash used in operating activities 12,040,578 287,350 5,165,759 210,271 Cash flows from investing activities Purchase of property, plant & equipment 6 (15,784,122) (779,125) (1,452,699) (85,805) Net cash used in investing activities (15,784,122) (779,125) (1,452,699) (85,805) (Decrease)/Increase in cash and cash equivalents (3,743,544) (491,775) 3,713,060 124,466 Movements in cash and cash equivalents At start of the year 21,080,528 1,164,864 17,367,468 1,040,398 (Decrease)/Increase in cash and cash equivalents (3,743,544) (491,775) 3,713,060 124,466 At end of year 9 17,336,984 673,090 21,080,528 1,164,864 The notes on pages 17 to 21 form an integral part of these financial statements. Report of the independent auditor - pages 6 to 8. 12 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: SIGNIFICANT ACCOUNTING POLICIES Significant accounting policies The principal accounting policies adopted in the preparation of these Financial Statements are set out below. These policies will be consistently applied in the future, unless otherwise stated. 1 General Information The Africa Centre of Excellence for sustainable mining (ACE Project) is a joint project which the Zambian Government, with the Copperbelt University as the implementing agent is running in conjunction with the International Development Association (IDA), the donor. The objective of the project is to support the recipient to strengthen selected eastern and Southern Africa higher education institutions in the recipients territory to deliver quality post graduate education and build collaborative research capacity in the regional priority areas. The Republic of Zambia and the International Development Association (IDA) signed the project preparation advance (PPA) agreement on 26 May 2016, for a total funding of six million US dollars ($ 6 million). The IDA project 5803-ZM was approved by Board of the World Bank. The financing agreement was signed on 11th May 2017 between the republic of Zambia and the international Development Association (IDA) became effective in 2018. The closing date of the credit will be in 2022. The financial statements have been prepared on the basis of historical cost. Unless stated otherwise. 2 a) Basis of preparation The Financial Statements have been prepared in accordance with the IFRS for SMEs and financial guidelines contained in the Project Agreement and as summarised in the accounting policies below. The University recognises that in certain respects, the existing IFRS for SMEs do not cover issues unique to not-for-profit organisations. Therefore, the University has developed accounting and procedures policies which draw on other widely applied standards to provide guidance on these matters. Going concern As at 31 December 2023, the project management for Africa Centre of Excellence for Sustainable Mining (ACESM) completed the 5-year project. However, some project objectives were not achieved because the project period had elapsed. For example, construction of the technical laboratory is still under work in progress. To ensure continuity and sustainability of the Centre's activities, the Centre has to be integrated into the University systems and governance structures while maintaining its identity and autonomy. All support functions will be provided by the University's support units, ensuring efficient support services without burdening CBU -ACESM 's structure. The governance structure will evolve as the Centre becomes sustainable and is able to cover its costs to ensure a broadened scope of operations. 13 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) b) Key sources of estimation uncertainty The University makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. Transactions in foreign currencies during the year are converted into Zambian Kwacha at rates ruling at the transaction dates. Assets and liabilities at the reporting date which are expressed in foreign currencies are translated into Zambian Kwacha at rates ruling at that date. The resulting differences from conversion and translation are dealt with in surplus or deficit in the year in which they arise. c) Income recognition i) Grants received Income in the form of grants is recognised when it is probable that future economic benefits will flow to the University and these benefits can be measured reliably when disbursement linked indicators (DLI) have been met. ii) Other income Interest income is accrued by reference to time in relation to the principal outstanding and the effective interest rate applicable. d) Expenditure recognition Expenditures are recognised when they are incurred on the goods that have been delivered or services rendered and not necessarily when the payment is effected. e) Property, plant & Equipment All property, plant and equipment is initially recorded at cost and thereafter stated at historical cost less depreciation . Historical cost comprises expenditure initially incurred to bring the asset to its location and condition ready for its intended use. Freehold land, buildings are subsequently shown at market value, based on periodic valuations less subsequent depreciation. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the company and the cost can be reliably measured. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial year in which they are incurred. Property ,plant and equipment are depreciated on the reducing balance basis over their expected useful lives to their estimated residual value. Property plant and equipment is carried at cost less accumulated depreciation and any impairment. The useful lives of items of property, plant and equipment have been assessed as follows: 14 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Significant accounting policies (continued) e) Property, plant & Equipment (Continued) Rate % Land & Buildings 2 Computer equipment 25 Motor vehicles 20 Furniture and fittings 25 The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposal of property, plant and equipment are determined by comparing the proceeds with the carrying amount and are taken into account in determining operating profit/loss. On disposal of revalued assets, amounts in the revaluation reserve relating to that asset are transferred to retained earnings in the statement of changes in equity. f) Intangible assets Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is recognised on a straight line basis over their estimated useful lives. The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated impairment losses. Computer software Computer software licenses are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. These costs are amortised over their estimated useful lives which are estimated to be 4 years. Rate (%) Computer software 25 g) Cash and cash equivalents For the purposes of the statement of cash flows, cash and cash equivalents comprise cash in hand, deposits held at call with banks. 15 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) h) Payables Accruals and other payables are obligations on the basis of normal credit terms and do not bear interest. Payables denominated in a foreign currency are translated into the functional currency using the exchange rate at the reporting date. The resulting differences from conversion and translation are dealt with in profit or loss in the year in which they arise. i) Employee benefit obligations Pension obligations The Project and its employees contribute to the National Pension Scheme Authority (NAPSA), a statutory defined contribution scheme registered under the NAPSA Act. The organisation’s contributions to the defined contribution scheme are charged to statement of income and expenditure in the year to which they relate. Accrued leave The estimated monetary liability for employees' accrued annual leave entitlement at the reporting date is recognised as an expense accrual. j) Change in Accounting policy on depreciation and amortisation. The project changed its policy on depreciation of property plant and equipment and amortisation of intangible assets from reducing balance to straight line basis in 2023. 16 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: 1 Grants 2023 2022 ZMW USD ZMW USD International Development Association 31,991,292 1,471,781 12,427,490 589,385 31,991,292 1,471,781 12,427,490 589,385 2 Other income Discount received 39,562 1,953 12,965 758 Interest received 10,201 521 26,357 1,526 49,763 2,474 39,322 2,284 3 Direct costs Achieve learning excellence 6,990,968 345,083 9,889,066 584,108 Research excellence 1,505,205 74,299 2,812,241 166,108 Quality assurance 607,909 30,007 305,000 18,015 Achieving equity dimension 396,413 19,567 - - Attract academic staff and students from region - - 324,052 19,140 Management and governance 2,476,288 122,233 2,658,306 157,016 Sustainable financing - - 84,519 4,992 Monitoring and evaluation 405,420 20,012 919,021 54,283 12,382,203 611,201 16,992,205 1,003,662 4 Other expenses Audit fees 166,195 8,204 169,020 9,983 Bank charges 30,420 1,502 64,423 3,805 Amortization 211,281 34,603 154,242 9,110 Depreciation 1,317,129 65,016 979,932 57,880 1,725,025 109,325 1,367,617 80,778 5 Exchange difference Exchange gain/(loss) on translations 2,421,413 (217,235) (2,178,131) (96,729) Totals 2,421,413 (217,235) (2,178,131) (96,729) 17 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: (CONTINUED) 6 Property, plant and equipment Year ended 31 December 2023 Land and Motor Office Furniture and Note Buildings vehicles equipment fittings CWIP Total Cost or valuation ZMW ZMW ZMW ZMW ZMW ZMW At start of year 1,477,534 588,434 4,670,460 306,094 756,561 7,799,083 Prior year adjustment 11 - - (242,348) - - (242,348) Restated 1,477,534 588,434 4,428,112 306,094 756,561 7,556,735 Additions 2,725,042 - 237,700 - 12,821,380 15,784,122 At end of year 4,202,576 588,434 4,665,812 306,094 13,577,941 23,340,857 Comprising Cost 4,202,576 588,434 4,665,812 306,094 13,577,941 23,340,857 At end of year 4,202,576 588,434 4,665,812 306,094 13,577,941 23,340,857 Depreciation At start of year 92,016 371,514 1,685,937 238,047 - 2,387,514 Prior year adjustment 11 2,421 158,077 31,207 6,788 - 198,493 Restated 94,437 529,591 1,717,144 244,835 - 2,586,007 Charge for the year 52,259 58,843 1,155,140 50,887 - 1,317,129 At end of year 146,696 588,434 2,872,284 295,722 - 3,903,136 Net book value 4,055,880 - 1,793,528 10,372 13,577,941 19,437,721 Property, plant and equipment Land and Motor Office Furniture and CWIP Buildings vehicles equipment fittings Total Cost or valuation USD USD USD USD USD USD At start of year 98,202 59,558 285,843 21,068 44,687 509,358 Valuations - - (11,963) - - (11,963) Additions 134,512 - 11,733 - 632,880 779,125 At end of year 232,714 59,558 285,613 21,068 677,567 1,276,520 Comprising Cost 232,714 59,558 285,613 21,068 677,567 1,276,520 At end of year 232,714 59,558 285,613 21,068 677,567 1,276,520 Depreciation At start of year 5,156 24,677 93,340 14,252 - 137,425 Valuations 119 31,976 1,541 335 - 33,971 Charge for the year 2,580 2,905 57,019 2,512 - 65,016 At end of year 7,855 59,558 151,900 17,099 - 236,412 Net book value 224,859 - 133,713 3,969 677,567 1,040,108 All assets will be intergrated into the University system as part of the sustainability plan for the project. 18 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: (CONTINUED) 7 Intangible assets Note ZMW USD Year ended 31 December 2023 Cost or valuation At start of the year 933,375 52,754 At end of year 933,375 52,754 Amortization At start of year 470,649 25,765 Prior year adjustment 11 (105,372) Restated 576,021 25,765 Charge for the year 211,281 15,861 At end of year 787,302 41,626 Net book value 146,073 11,128 Year ended 31 December 2022 ZMW USD Cost or valuation At start of year 933,375 52,754 Additions - - At end of year 933,375 52,754 Amortization At start of year 316,407 16,655 Charge for the year 154,242 9,110 At end of year 470,649 25,765 Net book value 462,726 26,989 The intangible asset represents the cost of team work software that is amortised over the useful life of the asset. 8 Trade and other receivables 2023 2022 ZMW USD ZMW USD Receivables 14,181,752 582,709 3,356,039 185,447 19 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: (CONTINUED) 9 Cash and cash equivalents 2023 2022 ZMW USD ZMW USD Cash on hand 4 - - - Cash at bank 17,336,980 673,090 21,080,528 1,164,864 17,336,984 673,090 21,080,528 1,164,864 Cash at bank can be analysed as follows Bank of Zambia (BOZ) 6,195,087 240,518 8,816,996 487,208 Investrust US Dollar ($) 1,405,796 54,579 373,063 20,615 Investrust Kwacha (ZMW) 8,075,513 313,523 10,758,847 594,510 15,676,396 608,620 19,948,906 1,102,333 10 Trade and other payables 2023 2022 ZMW USD ZMW USD Accruals 2,664,704 141,469 1,684,917 93,105 11 Prior year adjustment The following are the reasons for the prior year adjustments; ZMW 198,493 relates to changes in depreciation policy on Property plant and equipment, from reducing balance to straight-line method. ZMW 23,384 relates to the revaluation reserve for the period. (ZMW 2,853) relates to adjustment of administrator's salary accrued. ZMW105,372 relates to adjustment of amortisation as a result of change in accounting policy from reducing balance to straight line. ZMW 242,348 relates to adjustment of overstated office equipment cost. 12 Contingent liabilities There were no contingent liabilities as at the year end. 13 Commitments As at 31 December 2023, the Copperbelt University African Centre of Excellence in Sustainable Mining (ACESM) Project had not entered into contractual agreements to purchase property, plant & equipment (2022: ZMW Nil). 14 Comparatives Where necessary, comparative figures have been restated in order to afford reasonable comparison in the current year . 20 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 NOTES: (CONTINUED) 15 Events after the reporting period As at 27th March 2024, the Copperbelt University Council approved the sustainability plan for the Copperbelt University - African Centre of Excellence in Sustainable Mining (ACESM). Additionally, all bank balances held at Investrust Bank Plc "in Possession" currently banking with ZICB and ZANACO. 16 Presentation currency The financial statements are presented in Zambian Kwacha (ZMW) rounded off to the nearest Kwacha (ZMW), and the equivalent US dollars translated as follows; - Average rate of ZMW 20.2588 per USD (2022: ZMW 16.9302) for income statement items. - Closing rate of ZMW 25.7573 per USD (2022: ZMW 18.097) for statement of financial position items. 21 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 ACTUAL VERSUS BUDGET (CONTINUED) Appendix i- Actual vs Budget 31-Dec-23 Category of expenditure Budgeted Actual Variance USD $ USD $ USD $ Comments Short courses were not run; some staff exchanges were not undertaken a. Achieve Learning Excellence 452,918 345,083 107,835 due to limited time before closure of the Project on 31st December 2023 and the University recess from 22nd December 2023 in Q4. Most research activities and MOUs were not undertaken. Most of Q4 activities were not undertaken due b. Research Excellence 250748 74,299 176,449 to limted time before closure of the Project on 31st December 2023 and the University recess from 22nd December 2023 Regional accreditation for three c. Quality Assurance 204,666 101,776 102,891 programmes were not completed by Project closure time. CSR short courses not undertaken due to limited time before closure of d. Achieving Equity Dimension 27807.11 19,567 8,240 the Project on 31st December 2023 and the University recess from 22nd December 2023. Planning activity for 2024 and some procurement activities were not undertaken; ongoing expenses for e. Management and Governance 1,433,500 889,381 544,119 Centre operations and analytical laboratories construction works were not fully undertaken by 31st December 2023 Audit Committee of Council costs were undertaken by the University f. Monitoring and Evaluation 47,100 20,012 27,088 Management; Risk Management Committee workshop was not undertaken Totals 2,416,739 1,450,118 966,621 22 THE COPPERBELT UNIVERSITY Africa Centre of Excellence for Sustainable Mining (ACESM) International Development Association (IDA) Project No. 5803-ZM Annual Report and Financial Statements For the year ended 31 December 2023 ACTUAL VERSUS BUDGET (CONTINUED) Appendix ii- Actual vs Budget 31-Dec-22 Category of expenditure Budgeted Actual Variance USD $ USD $ USD $ Comments A few students did not receive stipends as they a. Achieve Learning Excellence 704,500 584,108 120,392 did not meet their milestones. Procurement delays for student research activities. Inability to undertake b. Research Excellence 320,423 166,108 154,315 tailor made research with partners. Failure to undertake international accreditation. Delays in c. Quality Assurance 165,901 18,015 147,886 completion of the rehabilitation of the laboratory. Fluctuations in the d. Attract Academic Staff and Students from Kwacha with an increase 19,000 19,140 (140) the Region in the rate from figure used during the planning and budget development. Delays in the completion of works by the e. Management and Governance 898,164 157,016 741,148 consultants due to the variations in the scope of works. Inability to undertake f. Sustainable Financing 16,000 4,992 11,008 planned income generation. Spent less than budget on the activity (Mid-term g. Monitoring and Evaluation 63,550 54,283 9,267 Review Workshop) due to inability for some participants to attend. Totals 2,187,538 1,003,662 1,183,876 23