PRIVATE JOINT STOCK COMPANY "UKRHYDROENERGO" "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT SPECIAL PURPOSE FINANCIAL STATEMENTS for the period from January 01, 2023 to December.31, 2023 Together with Independent Auditor's Report 41 4J "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT Special Purpose Financial Statements for the period from January 01, 2023 to December 31, 2023 in USD Contents: INDEPENDENT AUDITOR'S REPORT 1-IV STATEMENT OF MANAGEMENT'S RESPONSIBILITY FOR THE PREPARATION AND APPROVAL OF SPECIAL PURPOSE FINANCIAL STATEMENTS I SPECIAL PURPOSE FINANCIAL STATEMENTS OF "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT: SUMMARY OF SOURCES AND USES OF FUNDS 2 STATEMENT OF WITHDRAWALS FROM THE LOAN ACCOUNT 3 STATEMENT OF WITHDRAWALS FROM THE LOAN ACCOUNT 4 STATEMENT OF WITHDRAWALS THROUGH PROCEDURE FOR DRAWING UP STATEMENTS OF EXPENDITURE 5 STATEMENT OF WITHDRAWALS FROM SPECIAL ACCOUNTS 6 STATEMENT OF WITHDRAWALS FROM SPECIAL ACCOUNTS (CONTINUED) 7 STATEMENT OF SPECIAL ACCOUNTS 8 STATEMENT OF ACTUAL EXPENSES IN THE NATIONAL CURRENCY 9 RECONCILIATION BETWEEN THE RECORDS OF PMU AND THE BANK 10 NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS 11 1. PROJECT DESCRIPTION 11 2. BASIS OF PRESENTATION 11 3. ACCOUNTING POLICIES 12 4. BUDGET 12 5. LOAN REPAYMENT SCHEDULE 14 6. ECONOMIC ENVIRONMENT 14 7. EVENTS AFTER THE REPORTING PERIOD 16 WORLD BANK AUDIT DOCUMENTATION CHECKLIST 18 The terms used in these special purpose financial statements for the "Ukraine - Improving Power System Resilience for European Power Grid Integration (Installation of Hybrid Systems for Electricity Production in PrJSC "Ukrhydroenergo")" Project are used in accordance with the official documents of the International Bank for Reconstruction and Development, Loan Agreement No. 9284-UA of the International Bank for Reconstruction and Development, and Loan and Grant Agreement No. TFOB5994 and No. TFOB5724 of the Clean Technology Fund. BDO LLC B D O '38 044 391 26 87 201-203, Khatkivske road, 10th floor Fax 38 044 393 26 91 Kyiv, Ukraine 02121 T 1: +38 056 370 30 43 4, Andriia F abia sut Fa +38 056 370 30 45 Dnipro, Ukrainc 49000 E-mail: info,bdo ua INDEPENDENT AUDITOR'S REPORT To the Management of PrJSC "UKRHYDROENERGO" To the Representatives of the International Bank for Reconstruction and Development To the Representatives of the Clean Technology Fund Opinion We have audited the special purpose In our opinion, special purpose financial statements give true financial statements of "Ukraine - and fair view of the sources and uses of the funds of Loan No. Improving Power System Resilience for 9284-UA, Clean Technology Fund Loan and Grant Agreement European Power Grid Integration No. TFOB5994 and No. TFOB5724, respectively, in respect of (Installation of Hybrid Systems for "Ukraine - Improving Power System Resilience for European Electricity Production in PrJSC Power Grid Integration (Installation of Hybrid Systems for "Ukrhydroenergo")" Project as at Electricity Production in PrJSC "Ukrhydroenergo")" Project December 31, 2023 and for the period as at December 31, 2023 and for the period from January 01, from January 01, 2023 to December 2023 to December 31, 2023, in accordance with the 31, 2023, financed by the International regulations of the Bank. Bank for Reconstruction and External funds have been used as required by the relevant Development Loan No. 9284-UA, Clean general terms and conditions, financial arrangements and Technology Fund Loan and Grant Disbursement Letter paying due attention to efficiency and Agreement No. TFOBS994 and Noh cost-effectiveness; and have been used only for the TFOB5724, respectively, whi corresponding purposes. comprise: The services have been purchased in compliance with the * Summary of sources and uses of corresponding general conditions, financial agreements, and funds as of December 31, 2023; the Disbursement Letter. * Statement of expenditures from Accounting and storing of the necessary supporting January 01, 2023 to December 31, documents, accounting data and accounts regarding all 2023; Project transactions, including those concerning the expenditures disclosed in the Statements of actual - Statement of Special Account for expenditures, are performed in a due manner. There is a the period from January 01, 2023 clear interconnection between accounting data and the zi to December 31, 2023; financial statements provided to the World Bank. Summary of significant accounting The prepared special purpose financial statements comply policies and other explanatory with the requirements of generally accepted accounting notes. principles and practices, and the instructions from the World Bank, and give true and fair view of the financial position of the Project as at December 31, 2023, as wel as the resources and expenditures for the period from January 01, 2023 to December 31, 2023. Separate opinion on expenditures In addition, with regard to the expenditures for the period from January 01, 2023 to December 31, 2023, proper supporting documentation was maintained to confirm applications submitted to the Bank for reimbursement of the expenditures incurred, and that the expenditures stated in the withdrawal applications are to be financed in accordance with the terms and conditions of the Loan No. 9284-UA, Loan No. TFOB5994 and Grant Agreement No. TFOB5724. IBDO Separate opinion on the Statement of Special Account In our opinion, the special purpose financial statements on the Special accounts give true and fair view of financial position of the Special Accounts of the Project, as at December 31, 2023 and for the period from January 01, 2023 to December 31, 20203 in consistence with the World Bank regulations. These accounts were maintained according to the provisions of the corresponding general conditions, financial agreements, and the Disbursement Letter. 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 Special purpose financial statements section of our report. We are independent of the PrJSC "Ukrhydroenergo" in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (JESBA Code) and ethical requirements applied in Ukraine to our audit of financial statements, 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. Material uncertainty related to going concern (1) Closing date for the Loan disbursement We draw attention to Note 3 to the special purpose financial statements, which states that the closing date for the Loan disbursement is December 31, 2026, or such later date set by the Bank. Our opinion is not modified in respect of this matter. (2) Military aggression of the russian federation against Ukraine We draw your attention to Notes 6 and 7 to the special purpose financial statements of the Project, which state that from February 24, 2022, the Company is subject to a negative impact on its operations and financial performance related to the full-scale military invasion into the territory of Ukraine by the russian federation. The extent or timing of further developments or the timing of the end of hostilities is an uncertainty. These events and conditions, together with the other matters described in Notes 6 and 7, indicate that a material uncertainty exists that may cast significant doubt on the Company's and the Project's ability to continue as a going concern. The special purpose financial statements of the Project do not include any adjustments that might be required as a result of this uncertainty. Our opinion is not modified in respect of this matter. Ernphasis of matter Basis of accounting and restrictions on distribution and use We draw your attention to Note 2 to the special purpose financial statements for the Project, which describes the basis of accounting used in the preparation of the special purpose financial statements of the Project. The special purpose financial statements of the Project were prepared in accordance with the requirements of the World Bank; therefore, the special purpose financial statements of the Project may not be appropriate for other purposes. Our independent auditor's report is intended solely for the management of the Company, IBRD and CTF and should not be distributed to or used by any other party. Our opinion is not modified in respect of this matter. II IBDO Other matters The Company has prepared the package of financial statements for the year ended December 31, 2023, in accordance with International Financial Reporting Standards, for which we have expressed a separate independent auditor's report dated April 12, 2024. Responsibility of Management and Those Charged with Governance for the Special Purpose Financial Statements Management is responsible for the preparation and fair presentation of these special purpose financial statements in accordance with World Bank's regulations, and for such internal control as management determines is necessary to enable the preparation of the special purpose financial statements that are free from material misstatement, whether due to fraud or error. In preparing the special purpose financial statements, management is responsible for assessing the Project ability to continue as a going concern within the period of uses of funds, i.e., by December 31, 2026, or such later date set by the Bank 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 financial reporting process of the Project. 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 on the 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 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 the Company's management. * Conclude that management uses the going concern assumption as a basis for accounting and, based on the audit evidence obtained, conclude that there is significant uncertainty about events or conditions that would 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 special purpose financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence IIl IBDO obtained up to the date of our auditor's report. However, future events or conditions may affect the going concern of PrJSC "Ukrhydroenergo" as a whole and the Project implementation, in particular. 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 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. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. The audit was performed under the supervision of the Key Audit Partner Nikolayenko O.M. Key Audit Partner t Nikolaenko O.M. Number of registration with the Register of,Audors and Aidit Companies. 101534 June 14, 2024 / Kyiv Limited Liability Company BDO. Identification code under EDRFOU 201Y7074 Number of registration in the Register of Auditors and Audit Companies: 2868. Legal address: 4, Andriia Fabra Street, Dnipro, 49070. Tel. 044-393-2691. BDO LLC is included in the Register of auditors and audit companies in section 4 ,Auditing companies entitled to perform statutory audits of financial statements of public interest entities,. Link to the Register: https://www.apu.com.ualsubjekty-audytorskoi-dijainosti-jaki-najut-pravo-provodytyobovjazkovyj-audyt-finansovoi-zvitnosti- pidpryjemsty-shho-stanovjat-suspilnyj-interes/ U IV "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT Special Purpose Financial Statements for the period from January 01, 2023 to December 31, 2023 in USD STATEMENT OF MANAGEMENT'S RESPONSIBILITY FOR THE PREPARATION AND APPROVAL OF THE SPECIAL PURPOSE FINANCIAL STATEMENTS The following statement, which should be read in conjunction with the independent auditor's responsibilities stated in the independent auditor's report set out on pages -IV, is made with a view to distinguishing the respective responsibilities of management and those of the independent auditors in relation to the special purpose financial statements of "Ukraine - Improving Power System Resilience for European Power Grid Integration (Installation of Hybrid Systems for Electricity Production in PrJSC "Ukrhydroenergo")" Project financed by IBRD Loan No. 9284-UA, CTF Loan No. TF0B5994 and CTF Grant No. TF0B5724, for the period from January 01, 2023 to December 31, 2023. Management of the PrJSC "Ukrhydroenergo" and the Project is responsible for the preparation of the special purpose financial statements that give true and fair view of the financial position of the Project as at December 31, 2023, and the resources and expenditures for the period from January 01, 2023 to December 31, 2023. In preparing the special purpose financial statements, management of the PrJSC "Ukrhydroenergo" and the Project is responsible for: Selecting suitable accounting principles and applying them consistently; Presenting information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information; Providing additional disclosures in notes and annexes when compliance with the accounting policies set out in Note 3 is insufficient to understand the impact of particular transactions, other events and conditions on the special purpose financial statements of the Project; Assessing the ability of PrJSC "Ukrhydroenergo" and the Project to continue as a going concern. Management of the PrJSC "Ukrhydroenergo" and the Project is also responsible for: .d Developing, implementing and maintaining an effective and sound system of internal control over the Project; Keeping adequate accounting records that are sufficient to disclose with reasonable accuracy at any time the financial position of the Project and which enable them to ensure that the special purpose financial statements for the Project comply with the accounting policies set out in Note 3; Taking measures within its competence to ensure the safety of the Project assets; .S Preventing and detecting fraud and other irregularities. The special purpose financial statements for the period from January 01, 2023 to December 31, 2023, which are presented in this independent auditor's report, were approved on June 14, 2024. Signed on behalf of the PrJSC "Ukrhydroenergo": Acting Deputy CEO for Strate, and'Investments Oe SSO of the PrJSC "UkrhydroeneOLeg OSOSKOV AcigDpuyCOfrzUzyrenro\_ LwX "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT SUMMARY OF SOURCES AND USES OF FUNDS for the period from January 01, 2023 to December 31, 2023 in USD Actual For the period Aggregate Opening balance Special account of JSC "Ukreximbank" (IBRD loan No. 9284-UA) - USD 10,344 Current account of JSC "Ukreximbank" (IBRD loan No. 9284-UA) - UAH 4 Special account of JSC "Ukreximbank" (CTF loan No.TFOB5994) - USD 1,969 Current account of JSC "Ukreximbank" (CTF loan No.TFOB5994) - UAH 2 Total opening balance of available funds: 12,318 Sources of funds: Loan from the International Bank for Reconstruction and Development 13,020 468,372 Clean Technology Fund Loan 2,480 157,928 Clean TechnoLogy Fund grant PrJSC "Ukrhydroenergo" 470,426 806,852 Total funding: 485,926 1,433,152 Project expenses: Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project Category 2: Goods, works, non-consulting services, consulting services for Part 1.2 of the Project Category 3: Goods, works, non-consulting services, consulting services for Part 1.3 of the Project ri Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project 12,435 15,417 EU Category 5: Front-end fee - 595,500 IN Category 6: Interest Rate Cap or Interest Rate Collar premium - Category 7: Emergency expenditures t1 Consulting services, Training and Operating Costs under Part 2 of the Project - - Interest and commission on IBRD and CTF loans 470,426 806,852 Total Project expenditures: 482,861 1,417,769 Closing balance Special account of JSC "Ukreximbank" (IBRD loan No. 9284-UA) - USD 12,917 12,917 Current account of JSC "Ukreximbank" (IBRD Loan No. 9284-UA) - UAH 6 6 Special account of JSC "Ukreximbank" (CTF loan NoJFOB5994) - USD 2,456 2,456 C u r r e n t a c c o u n t o f J S C " U k r e x i m b a n k " ( C T F l o a n N o . T F 0 8 5 9 9 4 ) - U A H _44 15,383 15,383 Approved by the Management of the PrJSC "Ukrhydroener" andth4project and signed on its behalf: Acting Deputy CEO for Strategy and investments of the PrJSC "Ukrhydroenergo" Oleg OSOSKOV Notes on pages 11-17 are an integral part of the special purpose financial statements. r ~~/2/ // --~ ~w2 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF WITHDRAWALS FROM THE LOAN ACCOUNT for the period from January 01, 2023 to December 31, 2023 in USD For the Over the entire period Project Budget Funding 01.01.2023- irnplementation balance 31.12.2023 period Use of funds from the International Bank for Reconstruction and Development by Project components Category 1: Goods, works, non-consulting services, - - 149,557,500 149,557,500 consulting services for Part 1.1 of the Project Category 2: Goods, works, non-consulting services, - - 7,550,000 7,550,000 consulting services for Part 1.2 of the Project Category 3: Goods, works, non-consulting services, - 16,000,000 16,000,000 consulting services for Part 1.3 of the Project Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part I of 10,445 12,949 3,450,000 3,437,051 the Project Category 5: Front-end fee - 442,500 442,500 Category 6: Interest Rate Cap or Interest Rate Collar premium Category 7: Emergency expenditures Consulting services, Training and Operating Costs under Part 2 of the Project 10,445 455,449 177,000,000 176,544,551 Use of the funds of the Clean Technology Fund by Project components Category 1: Goods, works, non-consulting services, - - 28,747,000 28,747,000 consulting services for Part 1.1 of the Project Category 2: Goods, works, non-consulting services, - 1,450,000 1,450,000 consulting services for Part 1.2 of the Project Category 3: Goods, works, non-consulting services, - 3,000,000 3,000,000 consulting services for Part 1.3 of the Project LE Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of 1,990 2,468 650,000 647,532 the Project Category 5: Front-end fee - 153,000 153,000 Category 6: Interest Rate Cap or Interest Rate Collar premium Category 7: Emergency expenditures - Consulting services, Training and Operating Costs under Part - - 1,000,000 1,000,000 2 of the Project 1,990 155,468 35,000,000 34,844,532 Use of funds of the PrJSC "Ukrhydroenergo" by Project components Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project - - - Category 2: Goods, works, non-consulting services, consulting services for Part 1.2 of the Project - - - Category 3: Goods, works, non-consulting services, consulting services for Part 1.3 of the Project - - - Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project Category 5: Front-end fee Category 6: Interest Rate Cap or Interest Rate Collar premium Category 7: Emergency expenditures - - - Consulting services, Training and Operating Costs under Part 2 of the Project - - - Interest and fees on IBRD and CTF loans 470,426 806,852 806,852 470,426 806,852 806,852 - Total Project expenditure 482,861 1,417,769 212,806,852 211,389,083 .4 Notes on pages 11-17 are an integral part of the special purpose financial statements. 3 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF WITHDRAWALS FROM THE LOAN ACCOUNT for the period from January 01, 2023 to December 31, 2023 in USD Payment USD Application number Category Date of withdrawal Currency Amount equivalent 2-A DA-A 12.12.2023 USD 12,600 12,600 3-A DA-A 21.12.2023 USD 420 420 2-B DA-B 12.12.2023 USD 2,400 2,400 3-B DA-B 21.12.2023 USD 80 80 Total: 15,500 Summary by category: DA-A 13,020 DA-B 2,480 Total: 15,500 W Notes on pages 11-17 are an integral part of the special purpose financial statements. 4 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF WITHDRAWALS THROUGH PROCEDURE FOR DRAWING UP STATEMENTS OF EXPENDITURE For the period from January 01, 2023 to December 31, 2023 In USD Ji Category SApplication number 1 2 3 4 5 6 Total 1. Expenses actually incurred before 01.01.2023 and reimbursed by the World Bank during the period 01.01.2023 - 31.12.2023 2-SOE - - - 937 - - 937 Total - - - 937 - - 937 2. Applications submitted to the World Bank and reimbursed in the period 01.01.2023 - 31.12.2023 3-SOE - - - 426 - - 426 4-SOE - - - 2,385 - - 2,385 5-SOE - - - 5,437 - 5,437 Total - - - 8,248 - - 8,248 3. Expenses actually incurred for the period from January 01, 2023 to December 31, 2023 From loan account - - - - - - From special accounts - - - - - From current accounts - - 12,435 - - 12,435 in national currency Total - - - 12,435 - - 12,435 4. Table of discrepancies in Project expenses between the World Bank and MU records for the period from January 01, 2023, to December 31, 2023 Reimbursed according to 8,248 - 8,248 IBRD data Amount of expenses not submitted for rembrsmet s t - - - - 4,187 - - 4,187 reimbursement as at 31.12.2023 According to MU - - - - 12,435 - - 12,435 Notes on pages 11-17 are an integral part of the special purpose financial statements. 5 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF WITHDRAWALS FROM SPECIAL ACCOUNTS For the period from January 01, 2023, to December 31, 2023 In USD IBRD loan No.9284-UA Payment USD Category Date of withdrawal Currency Amount Equivalent amount Sub_account 07.02.2023 USD 357 357 Sub-account 05.05.2023 USD 570 570 Sub account 19.06.2023 USD 1,480 1,480 Sub_account 10.07.2023 USD 280 280 Sub-account 10.08.2023 USD 1,395 1,395 Sub_account 14.09.2023 USD 1,430 1,430 Sub-account 28.09.2023 USD 1,430 1,430 Sub_account 03.11.2023 USD 865 865 Sub_account 15.12.2023 USD 1,280 1,280 Sub_account 28.12.2023 USD 1,360 1,360 Total: 10,447 Summary by category Sub_account 10,447 Total: 10,447 ii Notes on pages 11-17 are an integral part of the special purpose financial statements. 6 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF WITHDRAWALS FROM SPECIAL ACCOUNTS (CONTINUED) For the period from January 01, 2023 to December 31, 2023 In USD CTF loan No.TF0B5994 -Payment USD Category Date of withdrawal Currency Amount Equivalent amount Sub_account 07.02.2023 USD 68 68 Sub_account 05.05.2023 USD 108 108 Sub-account 19.06.2023 USD 290 290 Sub_account 10.07.2023 USD 50 50 Sub_account 10.08.2023 USD 262 262 Sub_account 14.09.2023 USD 275 275 Sub account 28.09.2023 USD 270 270 Sub_account 03.11.2023 USD 165 165 Sub_account 15.12.2023 USD 245 245 Sub_account 28.12.2023 USD 260 260 Total: 1,993 Summary by category Sub_account 1,993 Total: 1,993 Notes on pages 11-17 are an integral part of the special purpose financial statements. 7 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF SPECIAL ACCOUNTS For the period from January 01, 2023 to December 31, 2023 In USD Deposit bank Ukreximbank Account No. UA523223130000026007040059464 Loan No. 9284-UA Currency US dollars OPENING BALANCE 10,344 Receipts: Funds received 13,020 Interest accrued TOTAL FUNDS RECEIVED 13,020 Deductions: expenses Transfer of funds into the national currency 10,447 Direct payments from a special account Payment for banking services - TOTAL EXPENDITURES 10,447- CLOSING BALANCE 12,917 Deposit bank Ukreximbank Account No. UA89322310000026008050059464 Loan No. TFOB5994 Currency US dollars OPENING BALANCE 1,969 i Receipts: Funds received 2,480 Interest accrued TOTAL FUNDS RECEIVED 2,480 Deductions: expenses Transfer of funds into the national currency 1,993 Direct payments from a special account Payment for banking services TOTAL EXPENDITURES 1,993 CLOSING BALANCE 2,456 Notes on pages 11-17 are an integral part of the special purpose financial statements. 8 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT STATEMENT OF ACTUAL EXPENSES IN THE NATIONAL CURRENCY For the period from January 01, 2023 to December 31, 2023 In USD ----- Payment----- USD Project expenses (IBRD loan) Equivalent Currency Amount Amount Category 1: Goods, works, non-consulting services, consulting UAH - services for Part 1.1 of the Project Category 2: Goods, works, non-consuLting services, consulting UAH - services for Part 1.2 of the Project Category 3: Goods, works, non-consulting services, consulting UAH - services for Part 1.3 of the Project 384,538 10,445 Category 4: (a) consultancy services for Part 1.4 of the Project; and UAH (b) operating costs and training for Part I of the Project Category 5: Front-end fee UAH - UAH - Category 6: Interest Rate Cap or Interest Rate Collar premium Category 7: Emergency expenditures UAH - Consulting services, Training and Operating Costs under Part 2 of the UAH - - Project Total expenditure of the period ----- Payment----- USD Project expenditures (CTF Loan) Equivalent Currency Amount Amount Category 1: Goods, works, non-consulting services, consuLting UAH - services for Part 1.1 of the Project Category 2: Goods, works, non-consulting services, consulting UAH - services for Part 1.2 of the Project Category 3: Goods, works, non-consulting services, consulting UAH - - services for Part 1.3 of the Project 73,276 1,990 Category 4: (a) consultancy services for Part 1.4 of the Project; and UAH (b) operating costs and training for Part 1 of the Project Category 5: Front-end fee UAH - UAH - Category 6: Interest Rate Cap or Interest Rate Collar premium Category 7: Emergency expenditures UAH - Consulting services, Training and Operating Costs under Part 2 of the UAH - - Project Total expenditure of the period 73,276 1,990 Notes on pages 11-17 are an integral part of the special purpose financial statements. 9 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT RECONCILIATION BETWEEN THE RECORDS OF PMU AND THE BANK For the period from January 01, 2023 to December 31, 2023 In USD Loan amount 212,000,000 Deduct: Project expenditures: Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project Category 2: Goods, works, non-consulting services, consulting services for Part 1.2 of the Project Category 3: Goods, works, non-consulting services, consulting services for Part 1.3 of the Project - Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project 15,417 Category 5: Front-end fee 595,500 Category 6: Interest Rate Cap or Interest Rate Collar premium - Category 7: Emergency expenditures Consulting services, Training and Operating Costs under Part 2 of the Project _ Total: (610,917) Special account of JSC "Ukreximbank" (IBRD loan No. 9284-UA) - USD 12,917 Current account of JSC "Ukreximbank" (IBRD Loan No. 9284-UA) - UAH 6 Special account of JSC "Ukreximbank" (CTF Loan No.TFOB5994) - USD 2,456 Current account of JSC "Ukreximbank" (CTF loan No.TFOB5994) - UAH 4 Total available funds (15,383) Total withdrawals: (626,300) Balance as at December 31, 2023 211,373,700 iio Notes on pages 11-17 are an integral part of the special purpose financial statements. 10 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD 1. PROJECT DESCRIPTION The International Bank for Reconstruction and Development (the "IBRD") and PrJSC "Ukrhydroenergo" (the "Borrower") entered into Loan Agreement No. 9284-UA and Loan Agreement No. TFOB5994 and Grant Agreement No. TFOB5724 dated September 13, 2021, to finance "Ukraine - Improving Power System Resilience for European Power Grid Integration (Installation of Hybrid Systems for Electricity Production in PrJSC Ukrhydroenergo")" Project ("Project"). The objective of the Project is to enhance the flexibility of Ukraine's power grid through storage investments and market expansion to support synchronization with the European electricity grid and decarbonization of the power sector. The Project consists of the following parts: Part 1. Installation of Battery Energy Storage System ("BESS") with Solar Photovoltaic Plants ("PV"), Establishment of an Energy Management System and Supervision Consultancy. 1.1 Installation of: (i) BESS in Selected HPPs to provide ancillary services to the electricity grid; (ii) solar PV plants to supply electricity to the battery storage facilities and provide auxiliary consumption; and (iii) an energy management system. 1.2 Installation at Dniester HPP of a long duration BESS to charge electric vehicles, including electric buses. 1.3 Installation of a PV plant in Dniester HPP to support the charging of electric vehicles. 1.4 Provision of Project implementation support and financing of a supervision consultancy, including: (a) the carrying out of: (i) supervision, management and coordination activities; and (ii) Project audits; and (b) the carrying out of knowledge sharing activities to strengthen the Borrower's capacity in advanced energy management. Part 2. Technical Assistance Provision of technical assistance for: (i) the development of battery storage decommissioning and recycling technical procedures; (ii) the carrying out of a gender assessment of the Borrower's human resources policies and practices to identify factors influencing gender diversity and inclusion, including specific recommendations; (iii) the implementation of supervision and monitoring of environmental and social tasks under the Project, including, inter alia, the establishment and maintenance of a grievance redress mechanism and the carrying out of citizen engagement activities; and (iv) the strengthening of the Borrower's capacity on operation and maintenance best practices, safety measures, and battery recycling through the carrying out of training, workshops and study tours. Part 3. Contingent Emergency Response The Company may draw down the loan proceeds under the Loan Agreements until December 31, 2026. The cost of the Project is USD 212,000,000, including which includes the loan of IBRD No. 9284-UA in the amount of USD 177,000,000, loan of CTF No. TFOB5994 in the amount of USD 34,000,000, and Grant No. TFOB5724 in the amount of USD 1,000,000. 2. BASIS OF PRESENTATION These special purpose financial statements for the Project have been prepared on the cash basis of accounting and include the following significant accounting policies, which have been consistently applied in all material respects, and comply with the recommendations of the Financial Management Committee of the World Bank "Recommendations: Annual Financial Statements and Audit of Activities Financed by the World Bank". The Project funding is recognized as a source of funds for the Project when the funds are received. Project expenditures are recognized as a use of funds under the Project when payments are made. The reporting currency is USD. Items included in the special purpose financial statements of the Project are measured using the currency that best reflects the economic substance of the underlying events and circumstances related to the Company (the "functional currency"). The functional currency of the Project is USD. Transactions in other currencies are translated into USD at the interbank exchange rate ruling at the date of the transaction to convert the relevant USD into the currency of payment. Cash balances in other 11 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD currencies are translated into USD at the interbank exchange rate on the last date of conversion of USD into the currency of payment. 3. ACCOUNTING POLICIES Basis of preparation The special purpose financial statements were prepared on the cash basis of accounting. The accounting policies were consistently applied throughout the period of the use of the Loan funds. Reporting period This report covers the period of use of funds of IBRD Loan No. 9284-UA, CTF Loan No. TFOB5994 and CTF Grant No. TFOB5724 from January 01, 2023, to December 31, 2023. The World Bank has set the final closing date for the loan as December 31, 2026. Special bank account In accordance with the terms of the Loan Agreement and to ensure the implementation of the Project, the Ministry of Finance of Ukraine opened a Special Account in USD with JSC "Ukreximbank" on the terms agreed with the IBRD. Recognition of income and expenses The Project Management Unit maintains its records and prepares its financial statements on a cash basis. Receipts are recognized when they are received on the bank accounts supported by advances from IBRD. Expenditures are recorded on the date when the funds are withdrawn from the accounts. The Project Reports shall be prepared in accordance with the provisions of Section 5.09 of the General Conditions and on the basis of indicators acceptable to the World Bank. Each Project Statement covers a period equal to one calendar quarter and shall be submitted to the World Bank no later than forty-five (45) days after the end of the period covered by each such report. The procurement of all goods, works and non-consulting services required for the Project to be financed out of the Loan shall be in accordance with the requirements of the World Bank's Procurement Guidelines for IPF borrowers dated November 2020. All consultant services required for the implementation of the Project and to be financed from the Loan shall be procured in accordance with the requirements of the World Bank's Procurement Guidelines for IPF borrowers dated November 2020. Foreign currency transactions The accompanying special purpose financial statements are presented in US dollars. Transactions in other currencies are translated into USD at the actual exchange rate at which the currencies were purchased, unless otherwise stated. Statements of expenditure The statements of expenditure are used to recognize the expenditure incurred under the Loan during the calendar quarter and paid from the Special account. In accordance with the additional withdrawal guidelines established by IBRD, all expenditures paid from the Special account are to be included in the statements of expenditures for the relevant period and submitted to the IBRD. The statements of expenditure shall be accompanied by primary documents (copies of invoices, certificates of work performed, etc.). 4. BUDGET In order to respond quickly and solve problematic tasks in an emergency situation and overcome the consequences of an emergency, if any, at UGE facilities as a result of military operations, the Bank proposed to restructure part of the IBRD Loan No. 9284-UA to create a new Part 3 of the Project "Contingent Emergency Response" by transferring part of the IBRD loan amount from Part 1 of the Project 12 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD (from subcomponents of Project 1.1, 1.2, 1.3) to the new Part 3 of the Project "Contingent Emergency Response" within the total available amount of the IBRD Loan. On 13.01.2023, PrJSC "Ukrhydroenergo" signed and sent letters to the Bank amending the IBRD Loan Agreement, CTF Loan Agreement and CTF Grant Agreement without specifying the loan amount. The proceeds of the Loan in relation to the use of the proceeds of the IBRD Loan No. 9284-UA were used to finance the following expenditures and were used exclusively for the activities under the established categories: Amount of the Loan Allocated Percentage of (expressed in expenditure to Category USD) be financed Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project 149,557,500 84% Category 2: Goods, works, non-consulting services, consulting services for Part 1.2 of the Project 7,550,000 84% Category 3: Goods, works, non-consuLting services, consulting services for Part 1.3 of the Project 16,000,000 84% Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project 3,450,000 84% Category 5: Front-end fee 442,500 Category 6: Interest Rate Cap or Interest Rate Collar premium - Category 7: Emergency expenditures - 100% TOTAL 177,000,000 The proceeds of the Loan in relation to the use of the proceeds of the CTF Loan No. TFOB5994 were used to finance the following expenditures and were used exclusively for the activities under the established categories: Amount of the Loan Allocated Percentage of (expressed in expenditure to Category USD) be financed Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project 28,747,000 16% Category 2: Goods, works, non-consulting services, consulting services for Part 1.2 of the Project 1,450,000 16% Category 3: Goods, works, non-consulting services, consulting services for Part 1.3 of the Project 3,000,000 16% Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project 650,000 16% Category 5: Front-end fee 153,000 TOTAL 34,000,000 13 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRoDUCTION IN PRJSC "UKRHYDROENERGO")" PROJEcT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD The proceeds of the Loan in relation to the use of the proceeds of the CTF Grant No. TFOB5724 were used to finance the following expenditures and were used exclusively for the activities under the established categories: Amount of the Loan Allocated Percentage of (expressed expenditure to be Category in USD) financed Consulting services, Training and Operating Costs under Part 2 of the Project 1,000,000 100% TOTAL 1,000,000 5. LOAN REPAYMENT SCHEDULE The following tables set out the principal repayment dates of the Loan and the percentage of the total principal amount of the Loan payable on each Principal Repayment Date (the "Contribution Share"). IBRD loan repayment schedule i Principal repayment date Contribution share Each 15 February and 15 August From 15 August 2029 4.17% until 15 August 2040 15 February 2041 4.09% CTF Loan repayment schedule Principal repayment date Contribution share Each 15 February and 15 August E From 15 August 2031 1% until 15 August 2041 From 15 August 2041 2% until 15 February 2061 6. ECONOMIC ENVIRONMENT Ukraine is engaged in a full-scale war with the russian federation and the legal regime of martial law is in effect. In 2023, the economy recovered thanks to the high adaptability of businesses and households to the war and loose fiscal policy, which was supported by large-scale international financing. According to NBU estimates, GDP grew by 5.7% in 2023. Despite the war, economic growth will continue. In 2024, real GDP will grow by 3.6%, mainly due to high budget spending against the background of expected sufficient international assistance. However, if the active phase of the war lasts longer, the economy is likely to grow more slowly. Russia does not stop trying to destroy the country's economic potential. This is evidenced by the terrorist attack on the Kakhovka HPP, the intensification of barbaric shelling of port infrastructure, the blockade of the grain corridor in the Black Sea by russia and its eventual withdrawal from the grain agreement. Thus, the risks to the economy, as well as the need for international assistance, were significant. The main 14 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD assumption is that high security risks will decrease significantly as of 2025. If high security risks persist for longer, they will have a negative impact on business and consumer expectations, as well as on exchange rate and inflation expectations. This will also increase pressure on public finances and exacerbate problems in the Labor market. Under this scenario, economic growth potential will be Lower and inflationary pressures will be higher than currently expected. Thanks to external support and the NBU's consistent policy, Ukraine's international reserves grew by 42% in 2023 to reach USD 40.5 billion. Despite delays in the flow of international assistance in early 2024, it is expected to be resumed in the coming months. Under the baseline scenario of the NBU's forecast, Ukraine will receive about USD 37 billion in 2024 as external loans and grants. Since early 2023, inflation has been falling faster than expected. The easing of inflationary pressures was facilitated by an ample supply of food and fuel, as well as a rapid recovery of the energy system from the damage caused by the Russian terrorist attacks. An important factor was the improvement in inflation expectations since the beginning of the year amid the cessation of emission financing, the strengthening of the hryvnia cash exchange rate, and the increased attractiveness of hryvnia assets. As a result, in E, 2023, consumer inflation slowed to 5.1% year-on-year (26.6% in 2022). In July 2023, the NBU Board decided to cut the key policy rate to 22% from 25% set in June 2022. Given the improvement in inflation expectations and further slowdown in inflation, the current and projected rate cuts are consistent with maintaining the attractiveness of hryvnia savings. In September 2023, the NBU decided to cut the key policy rate from 22% to 20%, in October to 16%, and from December 15, 2023, to 15%. These steps support economic recovery white not posing a threat to macrofinancial stability. On October 3, 2023, the National Bank of Ukraine switched to a regime of managed exchange rate flexibility, following the strategy of easing currency restrictions. The official exchange rate is based on the interbank market rate and is no longer set by the NBU, as it was since February 24, 2022. In doing so, the NBU keeps monitoring the situation on the interbank foreign exchange market and tries to significantly limit exchange rate fluctuations, preventing both significant depreciation and significant strengthening of the hryvnia. The war between Ukraine and the russian federation is ongoing and results in significant destruction of property and assets in Ukraine and other material consequences. The consequences of the war are evolving daily and their impact in the longer term is uncertain. The future impact on the Ukrainian economy depends on the outcome of the full-scaLe war, the successful implementation of new reforms by the Ukrainian government, the country's recovery and transformation strategy with a view to EU membership, and cooperation with international funds. The management and personnel of the Company and the Project are Located outside the open hostilities and continue to operate in a relatively normal operating mode. These factors will have an impact on the Company's and the Project's operations results in future periods. The management of the Company and the Project monitors the development of the current situation and takes measures to minimize any negative consequences to the extent possible. When preparing these special purpose financial statements of the Project, the known and reasonably estimable effects of the above factors on the Project's special purpose financial statements in the reporting period were considered. Management of the Company and the Project cannot predict all developments that could have an impact on the wider economy and what effect they could have on the special purpose financial statements of the Project and the Company in the future. The management of the Company and the Project believe they are taking all necessary measures to support the sustainability of the business. However, a further unstable business environment could negatively affect the results of operations and financial position of the Company and the Project in a manner not currently determinable. These special purpose financial statements for the Project reflect management's current assessment of the impact a Ukrainian business environment has on the operations and the financial position of the Company and the Project. The future business environment may differ from management's current assessment. As at the date of approval for issue of these special purpose financial statements for the Project, there is a material uncertainty regarding the going concern. 15 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD 7. EVENTS AFTER THE REPORTING PERIOD Budget On June 11, 2024, certain amendments related to the Project were agreed with IBRD, namely: 1) The Project objectives have been amended. As amended, they are to: (a) to increase the flexibility of the Ukrainian electricity grid through investments in storage and market expansion to support synchronization with the European grid and decarbonization of the energy sector; and (b) to ensure an immediate and effective response to an appropriate emergency. 11) Amendments to Part 1 of the Project. After the amendments to Part 1 of the Project, it is as follows: 1.1 Installation of: (i) BESS at selected HPPs to provide ancillary services to the grid; (ii) solar PV to supply electricity to battery storage systems and provide additional power; and (iii) energy management system. 1.2 Provide support for the implementation of the Project and finance supervision consuLtancy services, including (a) conducting (i) supervision, management, coordination, and (ii) audits of the Project; and (b) knowledge sharing for the Borrower's capacity building for progressive energy management. Ill) Amendments to Part 3 of the Project. After the amendments to Part 3 of the Project, the following items are financed from the proceeds of the Loan, regarding the use of the IBRD Loan No. 9284-UA: Amount of the Loan Allocated Percentage of (expressed in expenditure to Category USD) be financed Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project 51,557,500 61% Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project 1,600,000 64% Category 5: Front-end fee 442,500 Category 6: Interest Rate Cap or Interest Rate Collar premium - Category 7: Emergency expenditures 123,400,000 100% TOTAL 177,000,000 The proceeds of the Loan in relation to the use of CTF Loan No. TFOB5994 shall be used to finance the following expenditure: Amount of the Loan Allocated Percentage of (expressed in expenditure to Category USD) be financed Category 1: Goods, works, non-consulting services, consulting services for Part 1.1 of the Project 32,947,000 39% Category 4: (a) consultancy services for Part 1.4 of the Project; and (b) operating costs and training for Part 1 of the Project 900,000 36% Category 5: Front-end fee 153,000 TOTAL 34,000,000 Ill) The Annex to the Agreements was amended to change the definition of "Selected HPPs". As amended, the "Selected HPPs" means the following HPPs: (i) Kyivska (HPPs, including the pumped storage power plant); (ii) Kanivska; (iii) Kremenchukska; (iv) Sredniodniprovska; (v) Dniprovska; and (vi) Dniesterska (HPPs, including the pumped storage power plant), as further defined in the Operational Manual. 16 "UKRAINE - IMPROVING POWER SYSTEM RESILIENCE FOR EUROPEAN POWER GRID INTEGRATION (INSTALLATION OF HYBRID SYSTEMS FOR ELECTRICITY PRODUCTION IN PRJSC "UKRHYDROENERGO")" PROJECT NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS For the period from January 01, 2023 to December 31, 2023 In USD Continuation of the full-scale war with russia As noted in Note 6, the full-scale war with russia is ongoing in Ukraine and the legal regime of martial Law is in effect. In the future, the key risk is the prolongation of the war even if the hostilities are localized. This will require the economy to operate for a long time under extreme conditions, which could lead to a deeper decline and increase the need for assistance from partners. The impact of the war on the global economy will also increase. In addition, there are significant risks of systematic disruptions in the rhythm of international assistance and/or a significant decline in its volume. The situation is still ongoing, and its consequences are stilt uncertain. It is currently impossible to predict all changes that may have an impact on the overall economy. Management keeps monitoring possible impact of the above-mentioned events on the Company and will take all possible measures to mitigate any consequences. The management and staff of the Company and the Project are outside the open hostilities and keep working in normal operating mode. 17 WORLD BANK AUDIT DOCUMENTATION CHECKLIST Name of Loan/Credit: World Bank UKRAINE Loan/Credit/Grant # 9284-UA, TFOB5994, TFOB5724 Period from 01 January 2023 to 31 December Audit Report: 2023 Check if Check if Included N/A I. Audit report (Opinion): A. Applicable accounting standards noted X B. Applicable auditing standards noted X ID C. Opinion rendered on all forms of withdrawals: 1. Statement of Expenditures _1 2. Special Account X D. Alt sources of financing for the project are noted II. Financial Reports: A. Revenue Earning Entity (all of the following are required): 1. Balance sheet X 2. Cash Flow Statement X 3. Income Statement X B. Non-Revenue Earning Entity (all of the following are required): 1. Balance sheet 2. Summary of Sources and Uses of Funds C. If applicable (refer to Loan Agreement): 1. Statement of Expenditure (SOE) Statement X 2. Special Account Statement X ill. Notes to the Financial Statements X IV. Reconciliation between World Bank records and project records X V. Management Letter 18