Centre for Coordination of Agricultural Research & Development for Southern Africa (CCARDESA) Financial Statements For the year ended 31 December 2023 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023 Contents General information 1 Directors’ statement responsibility and approval of the Financial Statements 2-3 Independent auditor’s report 4-6 Statement of Financial Position 7 Statement of Financial Performance 8 Statement of Changes in Net Assets 9 Statement of Cash Flows 10 Notes to the Financial Statements 11-30 The following detailed Financial Performance does not form part of the financial statements and is presented solely for the information of the members: Detailed Statement of Financial Performance (unaudited) 31 Page | i CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023 Directors’ statement of responsibility and approval of the Financial Statements (Continued) DIRECTORS Prof. Lala A Razafinjara (Chairperson) Republic of Madagascar Dr. R. J. Lepheana (Vice Chairperson) Kingdom of Lesotho Mr. Domingos Gove SADC representative Dr. Aggrey Agumya FARA representative Mr. Clemence T. Bwenje Republic of Zimbabwe Dr. Frank M. Kayula Republic of Zambia Ms. Amanda N. Chembezi Republic of Botswana Dr. Diana M. Earnshaw Kingdom of Eswatini Mr. Eddie B. S. Hasheela 1 Republic of Namibia Dr. Americo M. Conceição2 Republic of Mozambique EXECUTIVE DIRECTOR Prof. Cliff S. Dlamini Kingdom of Eswatini REGISTERED OFFICE CCARDESA Secretariat Ground Floor, Red Brick Building 4701 Mmaraka Road Gaborone Republic of Botswana POSTAL ADDRESS Private Bag 00357 Gaborone Republic of Botswana BANKERS Stanbic Bank Botswana Limited Standard Chartered Bank Botswana Limited ABSA Bank Botswana Limited AUDITORS BakerTilly YEAR OF INSTITUTION 2011 FUNCTIONAL CURRENCY United States Dollars (USD) ________________________________________ 1Appointed 01 July 2023 2Term expired on 30 June 2023 Page | 1 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023 Directors’ statement of responsibility and approval of the Financial Statements (Continued) The directors are responsible for the preparation and fair presentation of the Financial Statements of CCARDESA comprising a Statement of Financial Position as at 31 December 2023, a Statement of Financial Performance, a Statement of Changes in Net Assets and a Statement of Cash Flows for the year then ended, and the notes to the Financial Statements, which include summaries of significant accounting policies and other explanatory notes in accordance with International Public Sector Accounting Standards (“IPSAS”). The Financial Statements are prepared in accordance with IPSAS requirements and are based on appropriate accounting policies consistently applied and supported by reasonable and prudent judgements and estimates. The directors acknowledge that they are ultimately responsible for the system of internal financial control established by CCARDESA and place considerable importance on maintaining a strong control environment. To enable the directors to meet these responsibilities, the board sets standards for internal control aimed at reducing the risk of error or loss in a cost-effective manner. These standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting procedures and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout CCARDESA, and all employees are required to maintain the highest ethical standards in ensuring the CCARDESA’s business is conducted in a manner that, in all reasonable circumstances, is above reproach. The focus of risk management at CCARDESA is on identifying, assessing, managing and monitoring all known forms of risk across CCARDESA. While operating risk cannot be fully eliminated, CCARDESA endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems, and ethical behaviour are applied and managed within predetermined procedures and constraints. The directors are of the opinion, based on the information and explanations given by management that the system of internal control provides reasonable assurance that the financial records may be relied on for the preparation of the financial statements. However, any system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement or loss. The directors have reviewed CCARDESA’s cash flow forecasts for the twelve months from the date of approval of the financial statements and, considering this review and the current financial position, they are satisfied that CCARDESA has access to adequate resources to continue in operational existence for the foreseeable future. The external auditors are responsible for independently auditing and reporting on the Financial Statements in conformity with International Standards on Auditing. Their unqualified opinion on these Financial Statements appears in the Independent Auditor’s Report, on page 4 to 5 of these Financial Statements Page | 2 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023 Directors’ statement of responsibility and approval of the Financial Statements (Continued) The directors are of the opinion that these Financial Statements fairly present the financial position of CCARDESA as at 31 December 2023 and the results of their operations, changes in net assets and cash flow information for the year then ended in accordance with IPSAS. Directors' approval of the Financial Statements The Financial Statements set out on pages 7 to 30, which have been prepared on the going concern basis, were approved by the board on 19 July 2024 and were signed on its behalf by: ................................................ ................................................. Ms Amanda Nthati Chembezi Prof. Cliff S. Dlamini Member of the Board Executive Director Page | 3 Certified,Auditors Kgwebo @ Fairgrounds , Plot 64515 Fairgrounds, Gaborone T: +267 3916650, +267 3916659 info@bakertilly.co.bw www.bakertilly.co.bw Independent Auditor's Report To the Members of The Centre for Coordination of Agricultural Research and Development for Southern Africa Opinion We have audited the financial statements of Centre for Coordination of Agricultural Research and Development for Southern Africa (the Organization) set out on pages 7 to 30 which comprise the statement of financial position as at 31 December 2023, statement of financial performance, statement of changes in equity and statement of cash flows for the year then ended, and the notes to the financial statements, including a summary of significant accounting policies. In our opinion, the financial statements present fairly, in all material respects, the financial position of Centre for Coordination of Agricultural Research and Development for Southern Africa as at 31 December 2023, and its financial performance and cash flows for the year then ended in accordance with International Public Sector Accounting Standards. Basis for Opinion We conducted our audit in accordance with International Standards on Auditing. 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 organization in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (Parts 1, 3 and 4A) (IESBA Code) and other independence requirements applicable to performing audits of Financial Statements in Botswana. We have fulfilled our other ethical responsibilities in accordance with the IESBA Code and in accordance with other ethical requirements applicable to performing audits in Botswana. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other Information The directors are responsible for the other information. The other information comprises the directors responsibility and statement of approval of the Financial Statements, and the Detailed Statement of Financial Performance. The other information 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 an audit opinion or 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. ADVISORY • AUDIT • TAX • ACCOUNTING Partners: Samuel N. Njanji CA (Z), FCPA, MBL Jean Jones CA(Z), FCPA Phibion P. Gwatidzo FCPA, FZICA, CA(Z) Baker Tilly Certified Auditors (Botswana) trading as Baker Tilly is a member of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. 4 Responsibilities of the Directors for the Financial Statements The directors are responsible for the preparation and fair presentation of the financial statements in accordance with the International Public Sector Accounting Standards, and for such internal control as the directors 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 directors are responsible for assessing the organization’s ability to continu e as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the organization or to cease operations, or have no realistic alternative but to do so. 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 International Standards on Auditing 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 International Standards on Auditing, we exercise professional judgement 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 organization’s internal control.  Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.  Conclude on the appropriateness of the directors' 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 organization’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 organization to cease to continue as a going concern.  Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. 5 We communicate with the directors 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. 14/08/2024 Baker Tilly Gaborone Firm of Certified Auditors Practicing Member: Samuel N Njanji (CAP 0054 2024) 6 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS Statement of Financial Position As at 31 December 2023 2023 2022 Notes USD USD ASSETS Current assets Cash and cash equivalents 2 1 923 002 2 921 816 Trade and other receivables 3 38 374 7 974 1 961 376 1 504 919 Non - Current assets Plant and equipment 4 31 757 6 026 Total assets 1 993 133 2 935 816 LIABILITIES Current liabilities Trade and other payables 5 167 934 25 358 Total liabilities 167 934 25 358 Total net assets 1 825 199 2 910 458 NET ASSETS Reserve Fund 6 531 501 531 589 Member States Contribution Fund 7 335 693 741 394 Administration Fund 8 933 (765) Capital Grants 9 31 757 6 026 Programme Funds 10 925 315 1 632 214 Total net assets 1 825 199 2 910 458 Page | 7 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS Statement of Financial Performance For the year ended 31 December 2023 2023 2022 Notes USD USD Revenue 11 3 791 713 3 116 094 Amortisation of capital grant 9 12 697 3 709 Operating expenditure (3 804 410) (3 119 803) Surplus for the period 13 - - Page | 8 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) FINANCIAL STATEMENTS Statement of Changes in Net Assets For the year ended 31 December 2023 Reserve Member states Administration Capital Programme TOTAL fund contribution Fund grants Funds ASSETS fund USD USD USD USD USD USD Balance at 31 Dec 2021 531 387 163 405 49 090 7 700 738 442 1 490 024 Contributions received - 980 910 47 307 - 3 658 658 4 686 875 Other receipts - - 7 - 503 510 Plant and equipment additions - - (2 035) 2 035 - - Amortisation of Capital grants - - - (3 709) - (3 709) Refund of prior year bank charges 231 - 56 - 412 699 Funds utilised (29) (402 921) (92 565) - (2 620 579) (3 116 094) Currency valuations - - (2 625) - (101 137) (103 762) Donor refunds - - - - (44 085) (44 085) Balance at 31 Dec 2022 531 589 741 394 (765) 6 026 1 632 214 2 910 458 Contributions received - 118 974 - - 2 590 430 2 709 404 Other receipts - - - - 682 682 Plant and equipment additions - (38 428) - 38 428 - - Amortisation of Capital grants - - - (12 697) - (12 697) Funds utilised (88) (486 247) (4 860) - (3 300 494) (3 791 689) Currency valuations - - 6 558 - 2 483 9 041 Balance at 31 Dec 2023 531 501 335 693 933 31 757 925 315 1 825 199 Notes 6 7 8 9 10 Page | 9 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA FINANCIAL STATEMENTS Statement of Cash Flows For the year ended 31 December 2023 2023 2022 Notes USD USD CASH FLOWS FROM OPERATING ACTIVITIES: Net cash used in operations 13 112 176 (4 946) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of plant and equipment 4 (38 428) (2 035) CASH FLOWS FROM FINANCING ACTIVITIES: Increase / (decrease) in Reserve Fund (88) 202 (Decrease) / Increase in Member States Contribution Fund (405 701) 577 989 Increase / (Decrease)/increase in Administration Fund 1 698 (49 855) Increase / (Decrease) in Capital Grants 25 731 (1 674) (Decrease) / Increase in Programme Funds (706 899) 893 772 Amortisation of Capital Grants 12 697 3 709 Net cash flows from financing activities (1 072 562) 1 424 143 Net (decrease) / increase in cash and cash equivalents (998 814) 1 417 162 Cash and cash equivalents at the beginning of the period 2 921 816 1 504 654 CASH AND CASH EQUIVALENTS AT THE END OF PERIOD 1 923 002 2 921 816 Page | 10 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 1. SIGNIFICANT ACCOUNTING POLICIES 1.1. Reporting entity The Centre for Coordination of Agricultural Research and Development for Southern Africa (CCARDESA) is a sub-regional organisation (SRO) supporting sixteen Member States of the Southern African Development Community (SADC). The organisation was designed by the Member States under the influence of the Forum for Agricultural Research in Africa (FARA); an apex continental organisation responsible for coordinating and advocating for agricultural research for development (AR4D). It was established as a regional agricultural Research and Development institution operating under the principle of subsidiarity. The establishment of CCARDESA was approved by the SADC Council of Ministers on 26 February 2010 and the Charter establishing CCARDESA entered into force on 5 April 2011, when two thirds of the Member States signed it. By 2015, all the SADC Member States had signed the Charter. The organisation became fully operational in 2013. Its main responsibility is to coordinate the implementation of agricultural research and development in the SADC region. 1.2. Basis of preparation These financial statements are prepared in accordance with International Public Sector Accounting Standards (IPSAS) as adopted by the International Public Sector Accounting Standards Board (IPSASB) and have been prepared on a historical cost basis. In the absence of an International Public Sector Accounting Standard that specifically applies to a transaction, other event or condition, management uses its judgment in developing and applying an accounting policy that results in information that is relevant to the decision-making needs of users so that the financial statements. − represent faithfully the financial position, financial performance and cash flows of the entity; − reflect the economic substance of transactions, other events and conditions and not merely the legal form; − are neutral, i.e., free from bias; − are prudent; and − are complete in all material respects. The principal accounting policies have been consistently applied in the current and previous financial year, unless stated otherwise. Standards, interpretations, and amendments to published standards that were adopted by CCARDESA or are not yet effective, are discussed in note 1.13. Based on materiality, certain comparatives in the notes have been aggregated. All amounts disclosed in these financial statements have been rounded off to the nearest one United States Dollar, unless otherwise stated. Page | 11 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 1.3. Presentation currency CCARDESA’s results are presented in United States Dollars which is also its functional currency. 1.4. Significant judgements and sources of estimation uncertainty In preparing the financial statements, management is required to make estimates and assumptions that affect the amounts represented in the annual financial statements and related disclosures. Use of available information and the application of judgement is used in the formation of estimates. Actual results in the future could differ from these estimates which may be material to the financial statements. 1.5. Key sources of estimation uncertainty The preparation of financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management’s best knowledge of current events and conditions, actual results may ultimately differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. The more significant areas requiring the use of management estimates and assumptions relate to contingent liabilities, depreciation and amortization calculations, asset impairments/reversals, provisions and useful life and residual value of plant and equipment. Judgements made by management in the application of IPSAS that have a significant effect on the financial statements, and significant estimates made in the preparation of these financial statements are discussed below. Accounts receivables CCARDESA assess its receivables for impairment at the end of each period. In determining whether an impairment loss should be recorded in the account, CCARDESA makes judgements as to whether there is observable data indicating a measurable decrease in the estimated future cash flows from a financial asset. The impairment for accounts receivable is calculated on an individual basis. Page | 12 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 1.5. Key sources of estimation uncertainty (Continued) Impairment testing At each reporting date, CCARDESA reviews the carrying amount of its assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash generating unit to which the asset belongs. If the recoverable amount of an asset is estimated to be less than its carrying amount, its carrying amount is reduced to its recoverable amount. Impairment losses are recognised in profit or loss. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount to the extent that it does not exceed the carrying amount that would have been determined had no impairment loss been recognised previously. Reversals of impairment losses are recognised in profit or loss. Impairment of trade and other receivables is established when there is objective evidence as a result of a loss event that the group will not be able to collect all amounts due according to the original terms of the receivables. Objective evidence includes failure by the counterparty to perform in terms of contractual arrangements and agreed terms. The amount of the impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Impairments relate to specific accounts whereby the carrying amount is directly reduced. The impairment is recognised in the income statement. Provisions Provisions are recognised when CCARDESA has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation, and the amount has been reliably estimated. Provisions are not recognised for future operating losses. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. Litigation and administrative proceedings are evaluated on a case-by-case basis considering the information available, including that of legal counsel, to assess potential outcomes. Page | 13 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 1.5. Key sources of estimation uncertainty (Continued) Provisions (Continued) Where it is considered probable that an obligation will result in an outflow of resources, a provision is recorded for the present value of the expected cash outflows if these are reasonably measurable. These provisions cover the estimated payments to plaintiffs, court fees and the cost of potential settlements. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense. Useful life and residual value of property, plant, and equipment The estimates of useful lives as translated into depreciation rates are detailed in property, plant, and equipment policy on the annual financial statements. These rates and residual lives of the assets are reviewed annually taking cognisance of the forecasted commercial and economic realities and through benchmarking of accounting treatments in the industry. 1.6. Plant and equipment Plant and equipment is stated at cost less accumulated depreciation and accumulated impairment losses. The cost of an item of plant and equipment is recognised as an asset when it is probable that future economic benefits associated with the item will flow to CCARDESA and the cost of the item can be measured reliably. Small value assets with a purchase value of less than USD 500 are expensed. Costs include costs incurred initially to acquire or construct an item of plant and equipment and costs incurred subsequently to add to the asset. If a replacement cost is recognised in the carrying amount of an item of plant and equipment, the carrying amount of the replaced part is derecognised. Depreciation is charged so as to write off the depreciable value of the assets over their estimated useful lives down to their residual values, using the straight-line method. The estimated useful lives, residual values and depreciation methods are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. The following methods were used during the year to depreciate plant and equipment to estimated residual values: Furniture and fixtures 5 years Straight line method Motor vehicles 4 years Straight line method IT equipment 3 years Straight line method Office equipment 5 years Straight line method Page | 14 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 1.6. Plant and equipment (Continued) Assets purchased for specific projects are fully expensed in the year of acquisition. 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 disposals are determined by comparing proceeds with the carrying amount and are recognised within ‘Other Income’ in the Statement of Financial Performance. 1.7. Financial instruments Recognition and initial measurement Financial instruments are recognised when CCARDESA becomes party to the contractual provision of an instrument, initially at fair value plus directly attributable transaction costs (except for financial instruments classified at fair value through profit and loss). Purchases and sales are recognised on trade date being the date CCARDESA commits to purchase or sell an asset. CCARDESA derecognises a financial asset only when the contractual rights to the cash flows from the asset expire; or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset. CCARDESA derecognises financial liabilities when, and only when, CCARDESA’s obligations are discharged, cancelled or they expire. Financial assets The classification of financial assets depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. CCARDESA's principal financial assets are cash and cash equivalents, other long-term receivables and trade and other receivables. Other long-term receivables and trade and other receivables are stated at their nominal value as reduced by appropriate allowances for estimated irrecoverable amounts. Disbursements to implementing partners and outstanding funds from donors are treated as recoverable in the statement of financial position. Accounts receivables are recorded at their estimated realizable value after providing for doubtful and uncollectible debts. Financial liabilities CCARDESA's principal financial liabilities are classified as 'other financial liabilities'. Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis. Significant financial liabilities comprise long term borrowings, trade and other payables and related CCARDESA balances. These are stated at their nominal value. Page | 15 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 1.8. Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, and other short‐ term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These are initially and subsequently recorded at fair value. 1.9. Foreign currency translation A foreign currency transaction is recorded, on initial recognition in US Dollars, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction. At the end of the reporting period: - foreign currency monetary items are translated using the closing rate. - non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction; and - Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous annual financial statements are recognised in profit or loss in the period in which they arise. 1.10. ICPs and Member States contributions Funds Funds received from ICPs, and Member States are initially recorded on the Statement of Financial Position of CCARDESA as Programme Funds and Member States or Reserve Funds, respectively. Member States contributions pledged and not yet received are not recognised as receivables. 1.11. Revenue Funds received from International and Regional Cooperating Partners (ICP) as well as State Parties are accounted for and reported as follows: - Generally, revenue is matched against the expenditure, as this is when the conditions of the grant are fulfilled. Expenditure not complying with requirements and or exceeding available resources under contractual instruments is not charged against an ICP. A system is in place to ensure that mandatory accounting and financial reporting requirements on these funds are complied with. - Funds are initially recorded on the Statement of Financial Position of CCARDESA as Programme Funds or Member States Funds and recognised as revenue when the related conditions of the funds have been fulfilled. Page | 16 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 - Funds received are recognised in the Statement of Financial Performance only when there is reasonable assurance that CCARDESA will comply with the conditions attached to them and the Funds will be received. 1.12. Employee benefits The cost of short-term employee benefits, (those payable within 12 months after the service is rendered, such as paid vacation leave and sick leave, bonuses, and non- monetary benefits such as medical care), are recognised in the period in which the service is rendered and are not discounted. 1.13. Standards not yet effective The International Public Sector Accounting Standards Board (IPSASB) has published the following new and amended standards that were originally to be effective 1 January 2022. The IPSASB has subsequently deferred the implementation dates of these standards and amendments, which are now effective 1 January 2023. The objective of this deferment, COVID-19: Deferral of Effective Dates, is to establish the deferral of the effective dates of IPSAS 41, Financial Instruments, IPSAS 42, Social Benefits, Longterm Interests in Associates and Joint Ventures (Amendments to IPSAS 36) and Prepayment Features with Negative Compensation (Amendments to IPSAS 41), Collective and Individual Services (Amendments to IPSAS 19), and some of the amendments in Improvements to IPSAS, 2019 by one year, to January 1, 2023. The following standards were issued but not yet effective by 31 December 2022: - IPSAS 19 – Provisions, Contingent Liabilities and Contingent Assets was amended to provide requirements for governments when committing to provide future collective and individual services to address the needs of society as a whole. The amendments are not anticipated to have any effect on the Financial Statements. - IPSAS 36 – Investments in Associates and Joint Ventures was consequentially amended, through the issuance of IPSAS 41 – Financial Instruments. These amendments will have no impact on the Financial Statements. - IPSAS 41 – Financial Instruments and subsequent amendment. This standard will replace the existing IPSAS 29 – Financial Instruments and sets out new requirements for recognition and measurement of financial instruments, including impairment, derecognition and general hedge accounting. CCARDESA does not foresee a significant impact on the Financial Statements resulting from this standard. - IPSAS 42 – Social Benefits. This standard defines social benefits as cash transfers to individuals to mitigate the effect of social risks and address the needs of society as a whole and provides guidance for their accounting. This standard will have no impact on the Financial Statements. - Improvements to IPSAS, 2019. Page | 17 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 2. CASH AND CASH EQUIVALENTS 2023 2022 USD USD Bank balances 1 923 002 2 921 816 Cash and cash equivalents at bank comprised of: CCARDESA Reserve Fund Standard Chartered Bank 531 501 531 589 CCARDESA MS Contributions Standard Chartered Bank 98 318 716 059 CCARDESA Administration Standard Chartered Bank 287 1 028 CCARDESA Administration Stanbic Bank 893 277 CCARDESA Payroll Standard Chartered Bank 764 764 CCARDESA World Bank Grant Stanbic Bank 110 738 196 605 CCARDESA IDA-LS Stanbic Bank 244 608 237 753 CCARDESA IBRD-AO Stanbic Bank 158 033 333 936 CCARDESA APPSA Standard Chartered Bank 55 354 55 597 CCARDESA CAADP XP4 Standard Chartered Bank 470 026 454 620 CCARDESA VAT Refunds Stanbic Bank 11 347 7 765 CCARDESA SADC SCT Stanbic Bank 929 929 CCARDESA GIZ COVID Stanbic Bank 25 25 CCARDESA FAO CSA Stanbic Bank 200 200 CCARDESA SADC GCCA Stanbic Bank 716 165 169 CCARDESA AICCRA Stanbic Bank 32 525 126 720 CCARDESA CNRM Stanbic Bank 46 246 92 580 CCARDESA FSRP Standard Chartered Bank 160 202 200 CCARDESA IWMI ABSA Bank 290 - 1 923 002 2 921 816 3. TRADE AND OTHER RECEIVABLES Project activity advances 38 374 7 974 Other receivables 47 662 47 662 Other receivables impairments (47 662) (47 662) 38 374 7 974 Recoverable amounts from exchange transactions impaired As of 31 December 2023, recoverable amounts from exchange transactions of USD 47 662 (2022: USD 47 662) were impaired and provided for fully. The amount of the provision was USD 47 662 as of 31 December 2023 (2022: USD 47 662). Project activity advances includes USD 25 000 advanced to APPSA Angola and APPSA Lesotho the Scientific training. Page | 18 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 3. TRADE AND OTHER RECEIVABLES (Continued) 2023 2022 USD USD The ageing of these receivables is as follows: Over 6 months 47 662 47 662 Reconciliation of provision for impairment of Recoverable amounts from exchange transactions Balance at the beginning of the period 47 662 47 662 Impairment for the year - - Balance at the end of the period 47 662 47 662 The creation and release of provision for impaired receivables have been included in the Reserve Fund. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash. The maximum exposure to credit risk at the reporting date is the fair value of each class of receivables mentioned above. CCARDESA does not hold any collateral as security. 4. PLANT AND EQUIPMENT 2022 Additions 2023 USD USD USD COST Furniture and fixtures 36 766 - 36 766 Motor vehicles 9 300 38 428 47 728 Office equipment 14 262 - 14 262 IT equipment 95 538 - 95 538 155 866 38 428 194 294 2021 Additions 2022 USD USD USD Furniture and fixtures 36 766 - 36 766 Motor vehicles 9 300 - 9 300 Office equipment 14 262 - 14 262 IT equipment 93 503 2 035 95 538 153 831 2 035 155 866 Page | 19 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 4. PLANT AND EQUIPMENT (Continued) ACCUMULATED 2022 Charge for 2023 DEPRECIATION the year USD USD USD Furniture and fixtures 36 612 - 36 612 Motor vehicles 9 299 9 607 18 906 Office equipment 10 238 2 009 12 247 IT equipment 93 691 1 081 94 772 149 840 3 709 162 537 2020 Charge for 2021 the year USD USD USD Furniture and fixtures 36 612 - 36 612 Motor vehicles 9 299 - 9 299 Office equipment 8 229 2 009 10 238 IT equipment 91 991 1 700 93 691 146 131 3 709 149 840 2023 2022 CARRYING AMOUNTS USD USD Furniture and fixtures 154 154 Motor vehicles 28 822 1 Office equipment 2 015 4 024 IT equipment 766 1 847 31 757 6 026 5. TRADE AND OTHER PAYABLES 2023 2022 USD USD Accruals 160 721 7 303 Audit fees accrual 7 213 15 292 167 934 22 595 Page | 20 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 6. RESERVE FUND 2023 2022 USD USD Member states reserve fund 531 501 531 589 Reserve Fund reconciliation Opening balance 531 589 531 387 Refund of prior year bank charges - 231 Bank charges (88) (29) Balance 531 501 531 589 Funds pledged and not yet honoured Democratic Republic of Congo 98 000 98 000 Republic of Malawi 80 000 80 000 United Republic of Tanzania 720 720 Republic of Zimbabwe 82 000 82 000 260 720 260 720 The Reserve Fund is used by CCARDESA Secretariat to support SADC Member States priority programmes, projects or activities which are not funded by International and Regional Cooperating Partners. The total once off contributions pledged for the Reserve Fund was USD 1 660 020. The cumulative total contributions honoured by the Member States for the Reserve Fund as of 31 December 2023 was USD 1 399 300 (2022: USD 1 399 300). The contributions to the Reserve fund were a once off contribution pledge by the Member states at the inception of CCARDESA. Member States contributions pledged for the Reserve Fund and not yet honoured are not recognised as receivables. Page | 21 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 7. MEMBER STATES CONTRIBUTION FUND 2023 2022 USD USD Member States Contribution fund 335 693 741 394 Member states contribution fund The Ministers responsible for Agriculture, Food Security, Fisheries and Aquaculture approved three-year annual contributions by Member States of USD 1.2 million per annum to support CCARDESA’s operational financial needs at the Joint Extraordinary meeting of 19th May 2017 held in Ezulwini, Kingdom of Eswatini. The Contributions per country are based on the SADC formula. Member states contribution fund reconciliation Opening balance 741 394 163 405 Contributions received from Member States 118 974 980 910 860 368 1 144 315 Funds utilised Auditors’ remuneration (19 267) (12 838) Bank charges (2 985) (1 968) Consultancy costs (5 843) (2 500) Computer expenses (10 398) - Communication costs (10 056) - Honoraria for Members of the Board (60 783) (13 500) Legal fees (26 636) (1 086) Meetings and facilitation costs (26 278) (70 901 Motor vehicle running costs (2 576) (871) Staff costs (314 090) (289 715) Stationery, office maintenance and consumables (7 335) (9 542) Plant and equipment additions (38 428) - (524 675) (402 921) Closing fund balance 335 693 741 394 Member States contributions received during the period Kingdom of Lesotho 118 974 - Republic of Mozambique - 7 833 Republic of South Africa - 720 036 United Republic of Tanzania - 253 041 118 974 980 910 Page | 22 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 7. MEMBER STATES CONTRIBUTION FUND (Continued) The Kingdom of Lesotho fully honoured her three-year annual contributions in the current year. The Republic of Mozambique partly honoured her first annual contribution in the prior year. The Republic of Angola, Republic of Botswana, United Republic of Tanzania, Republic of South Africa and the Kingdom of Eswatini fully honoured their three-year annual contributions in the prior years. The Republic of Namibia and Republic of Zambia honoured their first annual contribution in the prior years. Contributions pledged and not honoured as at 31 December 2023 Annual Year 1 Year 2 Year 3 Total Pledge USD USD USD USD D. R. Congo 77 460 77 460 77 460 77 460 232 380 Republic of Madagascar 64 646 64 646 64 646 64 646 193 938 Republic of Malawi 62 227 62 227 62 227 62 227 186 681 Republic of Mauritius 65 596 65 596 65 596 65 596 196 788 Republic of Mozambique 67 669 59 836 67 669 67 669 195 174 Republic of Namibia 66 172 - 66 172 66 172 132 344 Republic of Seychelles 3 542 3 542 3 542 3 542 10 626 Republic of Zambia 74 437 - 74 437 74 437 148 874 Republic of Zimbabwe 66 086 66 086 66 086 66 086 198 258 399 393 547 835 547 835 1 495 063 Contributions pledged and not honoured as at 31 December 2022 Annual Year 1 Year 2 Year 3 Total Pledge USD USD USD USD D. R. Congo 77 460 77 460 77 460 77 460 232 380 Kingdom of Lesotho 59 492 - 59 492 59 492 118 984 Republic of Madagascar 64 646 64 646 64 646 64 646 193 938 Republic of Malawi 62 227 62 227 62 227 62 227 186 681 Republic of Mauritius 65 596 65 596 65 596 65 596 196 788 Republic of Mozambique 67 669 59 836 67 669 67 669 195 174 Republic of Namibia 66 172 - 66 172 66 172 132 344 Republic of Seychelles 3 542 3 542 3 542 3 542 10 626 Republic of Zambia 74 437 - 74 437 74 437 148 874 Republic of Zimbabwe 66 086 66 086 66 086 66 086 198 258 399 393 607 327 607 327 1 614 047 Member States contributions pledged and not yet received are not recognised as receivables. Page | 23 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 8. ADMINISTRATION FUND 2023 2022 USD USD Administration Fund (765) (765) The Administration Fund is used to account for financial resources from the management and administration fees charged on certain projects, staff time cost recovered on certain projects and other sundry receipts. Administration fund reconciliation Opening balance (765) 49 090 Management fees and interest - 47 314 Current adjustments 6 558 (2 625) Prior year bank charges reversed - 56 Funds utilised (4 860) (94 600) Closing balance 933 (765) 9. CAPITAL GRANTS Capital grants at the beginning of the period 6 026 7 700 Additions to capital grants 38 428 2 035 Amortisation of capital grants (12 697) (3 709) Capital grants at the end of the period 31 757 6 026 The balance comprises grants received from supporting partners utilised for the acquisition of items of plant and equipment. The reserve is amortised over the life of the assets. The carrying amount of the capital grants is equivalent to the carrying amount of plant and equipment. Page | 24 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 10. PROGRAMME FUNDS The programme funds balances are inclusive of the following International Cooperating Partners and Regional Cooperating Partners unutilised funds for the various programmes under implementation. The funds are for specific projects and each project has its own designated bank account. 2023 2022 USD USD World Bank, APPSA MMZ1 55 354 55 597 World Bank, APPSA CCARDESA IDA2 78 702 193 739 World Bank, APPSA Lesotho IDA3 217 114 242 119 World Bank, APPSA Angola IBRD4 124 699 331 124 World Bank, FSRP IDA5 (Note 10.1) 157 171 - CIAT, AICCRA6 38 449 126 721 GIZ, CNRM7 21 182 92 580 GIZ, COVID Support Fund (14 035) (14 035) SADC CST Fund (30 821) (18 071) SADC GCCA+ (20 604) 171 768 IFAD, CAADP XP4 Fund8 298 114 450 672 International Water Management Institute (IWMI) (10) - Net project funds 925 315 1 632 214 1 Agricultural Productivity Programme for Southern Africa (Republic of Malawi, Republic of Mozambique, and Republic of Zambia) funded by the World Bank. 2 Agricultural Productivity Programme for Southern Africa (CCARDESA IDA Grant) funded by the World Bank. 3 Agricultural Productivity Programme for Southern Africa (Kingdom of Lesotho) funded by the World Bank. 4 Agricultural Productivity Programme for Southern Africa (Kingdom of Lesotho) funded by the World Bank. 5 Food System Resilience Program funded by the World Bank. 6 Accelerating Impacts of CGIAR Climate Research for Africa (AICCRA) programme funded by the Alliance of Bioversity International and the International Centre for Tropical Agriculture (CIAT). 7 Climate Resilience and Management of Natural Resources in the SADC Region program funded by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH 8 Comprehensive Africa Agriculture Development Programme ex-pillar IV Africa Regional and Sub-regional Organisations for Agricultural Research & Innovation (CAADP XP4). Page | 25 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 10. PROGRAMME FUNDS (Continued) 10.1 Food System Resilience Program (FSRP) 2023 2022 USD USD Opening balance - - Disbursements - World Bank 282 000 - Interest received 6 - 282 002 - Expenses by cost category Staff costs (80 396) - Facilitate planning and monitoring of programme (41 131) - Recruitment costs (2 171) - Office and Computer equipment (329) - Project overheads (808) - (124 835) - Closing balance 157 171 - Represented by: Cash at bank - Standard Chartered Bank Botswana Limited 160 202 200 Project payables (3 031) (200) 157 171 - Expenses by project component: Component 5: Project management and coordination 124 835 - 124 835 - The Food Systems Resilience Project (FSRP) is a regional project supported by World Bank. The project is being developed in phases, with the first phase of 6-year duration focusing on Madagascar in Southern Africa, Ethiopia in East Africa and the ECOWAS region. The total grant to CCARDESA is USD 5 million over the 6-year period and is only part of the global funding initiative covering several countries and institutions within Africa. In Southern Africa, the programme will start with Madagascar and is expected to expand to a number of countries. Page | 26 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 10. PROGRAMME FUNDS (Continued) The FSRP focuses on building resilience of the food systems of countries and regions by using smart approaches that circumvent the effects of climate change on agriculture. CCARDESA will regionally coordinate and facilitate activities planned under the Multiphase Programmatic Approach’s four core components through: (i) building resilient agricultural production capacity (ii) supporting sustainable development of natural resources in agricultural landscapes (iii) Support the value chain actors to get to the market, and (iv) Promoting food systems resilience in national and regional policymaking. The objective of this programme is to increase the resilience of food systems in Southern Africa in order to reduce the impact of climate change on the farming systems and food insecurity The programme will deal with and resolve the underlying structural challenges of food insecurity and reduce beneficiaries’ sensitivity to unpredictable climate events, crises and conflicts. The FSRP will achieve its objective through building resilient food production capacity, promoting the sustainable use of natural resources, enhancing food marketing, fostering resilience-focused public policies, and improving regional coordination. The Program Development Objective (PDO) of FSRP is to increase the resilience of food systems and preparedness against food insecurity in the participating countries. 11. REVENUE During the year, CCARDESA recognised the following revenue arising from exchanges of goods or services: Revenue from exchange transactions 3 791 713 3 116 094 Page | 27 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 11. REVENUE (Continued) 2023 2022 USD USD Revenue recognised per fund during the year World Bank, APPSA CCARDESA IDA 787 104 1 046 062 World Bank, APPSA Lesotho IDA 270 573 152 487 World Bank, APPSA Angola IBRD 336 239 274 168 World Bank, APPSA MMZ 243 315 IFAD, CAADP XP4 1 360 571 907 442 SADC, CST 12 750 7 000 SADC, GCCA+ 192 403 158 895 Reserve Fund 88 29 Member States Contribution Fund 486 248 402 921 Administration Fund 4 782 92 565 CIAT, AICCRA 144 314 73 303 GIZ, CNRM 71 452 907 World Bank, FSRP 124 835 - IWMI Project 10 - Other Funds 101 - 3 791 713 3 116 094 Amounts received from various International and Regional Cooperating partners and SADC member states for funding projects and operational activities during the year: SADC Member States contribution 118 974 980 910 World Bank, APPSA Lesotho IDA & APPSA Angola IBRD 374 970 680 917 Administration fund – Management fees and other fees - 47 307 World Bank, APPSA CCARDESA IDA 671 955 1 204 940 IFAD, CAADP XP4 1 205 530 1 248 546 GIZ, CNRM - 93 455 SADC GCCA+ - 230 799 World Bank, FSRP 281 990 - CIAT, AICCRA 55 985 200 000 Other receipts - 510 2 709 404 4 687 384 Page | 28 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 12. SURPLUS FOR THE PERIOD Surplus for the period is stated after charging the following: 2023 2022 USD USD Board costs 60 783 67 473 Consultancy costs 217 943 482 269 Depreciation 12 697 3 709 Auditors’ remuneration 22 687 15 970 Knowledge products and visibility material 13 605 3 009 Legal fees 26 636 1 086 Management and administration costs - 39 060 Meetings and facilitation costs 1 590 066 987 598 Programme plant and equipment 161 298 22 709 Recruitment costs 2 171 896 Staff costs 1 641 084 1 411 473 Stationery and computer consumables 9 814 28 776 13. CASH USED IN OPERATIONS Surplus for the period - - Adjustments for: Depreciation charge 12 697 3 709 Amortisation of capital grants (12 697) (3 709) Changes in working capital: Increase in trade and other receivables (30 400) (7 709) Increase in other financial liabilities 142 576 2 763 Net cash used in operations 112 176 (4 946) 14. RELATED PARTY DISCLOSURES Related party transaction for the period: Honoraria for members of the Board 60 783 39 000 Remuneration for Executive Director 199 697 181 300 260 480 220 300 Number of members of the board of directors 9 9 Page | 29 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Notes to the Financial Statements For the year ended 31 December 2023 15. RELATED PARTY DISCLOSURES (Continued) CCARDESA regards a related party as a person or an entity with the ability to exert control individually or jointly, or to exercise significant influence over CCARDESA, or vice versa. Members of key management are also regarded as related parties. Where transactions are undertaken with related parties and those transactions are not at arm’s length or not in the ordinary course of business the transactions and resultant balances are disclosed in the related party note in the financial statements. Members of the Board of Directors are paid an honorarium per each sitting and there are no loans advanced to them. The Executive Director is paid a monthly remuneration. The list of directors during the year under review is listed on page 1 of the Financial Statements. There were no advances to the board members and the Executive Director for the current year and prior year. 16. RISK MANAGEMENT Credit risk In the normal course of business, the organisation incurs credit risk from accounts receivable and transactions with banking institutions. The organization manages its exposure to credit risk by: Holding bank balances and short - term deposits (demand deposits) with Botswana registered banks, which are subsidiaries of major banks listed in UK. These banking institutions do not have any separate credit rating. Receivables from exchange transactions and prepayments as at 31 December 2023 totalled USD 13 365 (2022: USD1 375). Exchange rate exposure Exposure to foreign currency exchange rate movements arises in the normal course of CCARDESA's activities. While this is subject to the risk of foreign exchange rates changing, CCARDESA attempts to minimise the exposure by ensuring that contractual liabilities are in the currency of the foreign currency resources. 17. GOING CONCERN CCARDESA has access to adequate cash resources through signed financing agreements with various international and regional cooperating partners and is satisfactorily cash generative. Management is therefore satisfied that CCARDESA has adequate resources to continue to operate for the foreseeable future and that CCARDESA is a going concern. Page | 30 CENTRE FOR COORDINATION OF AGRICULTURAL RESEARCH & DEVELOPMENT FOR SOUTHERN AFRICA (CCARDESA) Detailed Statement of Financial Performance (unaudited) For the year ended 31 December 2023 2023 2022 USD USD Notes INCOME Revenue 11 3 791 713 3 116 094 Amortisation of capital grant 9 12 697 3 709 Total income 3 804 410 3 119 803 EXPENDITURE Auditors’ remuneration 22 687 13 183 Bank charges 14 955 67 473 Board costs 60 783 15 051 Communication costs 12 796 12 833 Computer and IT expenses 10 039 482 269 Consultancy costs 217 943 3 709 Depreciation 12 697 15 969 General maintenance 4 946 2 948 Knowledge products and visibility material 13 605 3 009 Legal fees 26 636 1 086 Management and administration costs - 39 060 Meetings and facilitation costs 1 590 066 987 598 Motor vehicle running costs 2 890 7 910 Programme plant and equipment 161 298 22 709 Recruitment costs 2 171 896 Small value assets - 3 851 Staff costs 1 641 084 1 411 473 Stationery and computer consumables 9 814 28 776 Total expenses for the period 3 804 410 3 119 803 Total comprehensive surplus for the period - - Page | 31