REPUBLIC OF KENYA

KENYA NATIONAL AUDIT OFFICE

REPORT

OF

THE AUDITOR-GENERAL

ON

THE FINANCIAL STATEMENTS OF KENYA TRANSPORT SECTOR SUPPORT

PROJECT (IDA CREDIT NO. 4926-KE COMPONENT- B2 SUPPORT TO

MINISTRY OF ROADS)

FOR THE YEAR ENDED 30 JUNE 2014

STATE DEPARTMENT OF INFRASTRUCTURE

101282

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'elephone: +254-20-342330 Fax: +254-20-311482 E-Mail: oag@oagkenyago.ke Website: www.kenao.go.ke

REPUBLIC OF KENYA

P.O. Box 30084-00100 NAIROBl

KENYA NATIONAL AUDIT OFFICE

REPORT OF THE AUDITOR-GENERAL ON KENYA TRANSPORT SECTOR SUPPORT PROJECT (IDA CREDIT NO. 4926-KE COMPONENT - 82 SUPPORT TO MINISTRY OF ROADS) FOR THE YEAR ENDED 30 JUNE 2014 - STATE DEPARTMENT OF INFRASTRUCTURE

REPORT ON THE FINANCIAL STATEMENTS

I have audited the accompanying financial statements of Kenya Transport Sector Support Project IDA Credit No. 4926 KE for the year ended 30 June 2014 set out on pages 1 to 9, which comprise the statement of financial assets and liabilities as at 30 June 2014, the statement of receipts and payments, statement of cash flows, the statement of comparison of budget and actual amount for the year then ended, and a summary of significant accounting policies and other explanatory information in accordance with the provisions of Article 229 of the Constitution of Kenya and Section 14 of the Public Audit Act, 2003 and the Credit Agreements No. 4926- KE dated 23 May 2011 between the International Development Association (IDA) and the Government of Kenya (GOK). I have obtained all the information and explanations which, to the best of my knowledge and belief, were necessary for the purpose of the audit.

Management's Responsibility for the Financial Statements

Principal Secretary of the State Department of Infrastructure and the Project Team Leader are responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The Management is also responsible for the submission of the financial statements to the Auditor-General in accordance with the provisions of Section 13 of the Public Audit Act, 2003.

Auditor-General's Responsibility

My responsibility is to express an opinion on these financial statements based on the audit. The audit was conducted in accordance with International Standards on Auditing. Those standards require compliance with ethical requirements and that the audit be planned and performed to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Project's internal co"rifrol. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements.

I believe that the audit evidence obtained is sufficient and appropriate to provide a basis for my audit opinion.

Opinion

In my opinion, the financial statements present fairly, in all material respects, the financial performance of the Project for the year ended 30 June 2014, in accordance with International Public Sector Accounting Standards (Cash Basis of Accounting) and conforms to the Credit Agreement No. 4926 - KE.

In addition, the Special Account Statement presents fairly the special account transactions and the ending balance has been reconciled with the books of account.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

As required by the International Development Association, I report based on my audit that:-

i) All International Development Association funds have been used in accordance with the conditions of the Credit Agreement, with due attention to economy, and efficiency and only for the purpose for which the funds were provided;

ii) Counterpart funds have been provided and used in accordance with the conditions of the Agreement, with due attention to economy and efficiency and only for the purpose for which they were provided;

iii) Goods and Services financed have been procured in accordance with the conditions of the agreement and in compliance with the Development partner's rules and procedures;

iv) Necessary supporting documents, records and accounts have been kept in respect of all project activities;

v) Adequate internal controls to monitor expenditure and other financial transactions exist; and

2

vi) The fixed assets register for the Projects' assets was maintained during the year.

Edward R.O. Ouko, CBS Auditor-General

Nairobi

19 December 2014

3

KENYATRANSPORTSECTORSUPPORTPROJECT (KTSSP PROJECT)

, STATE DEPARTMENT OF INFRASTRUCTURE

IDA4926-KE

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE FINANCIAL YEAR ENDED JUNE 30, 2014

Prepared in accordance with the Cash Basis of Accounting Method under the International Public Sector Accounting Standards (IPSAS)

KENYATRANSPORTSECTORSUPPORTPROJECT

• ports and Financial Statements e • For the financial year ended June 30, 2014

CONTENTS PAGE

1. PROJECT INFORMATION AND OVERALL PERFORMANCE ................................................................. i

2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES ....................................................... iv

3. REPORT OF THE INDEPENDENT AUDITORS ON THE KTSSP PROJECT ........................................... v

STATEMENT OF RECEIPTS AND PAYMENTS FOR THE PERIOD ENDED 30TH JUNE 2014 .......... 1

5. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30THJUNE 2014 .......................... 2

7-. STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS ............................................. 4 ·

8 .. , NOTES TO THE FINANCIAL STATEMENTS ....... ; .................................................................................... 5

9. PROGRESS ON FOLLOW UP OF AUDITOR RECOMMENDATIONS .................................................. 11

1

KENYATRANSPORTSECTORSUPPORTPROJECT

R•rts and Financial Statements F0r the a...a.1 year ended June 30, 2014

1. PROJECT INFORMATION AND OVERALL PERFORMANCE

1.1 Name and registered office

Name: The project's official is PRINCIPAL SECRETARY for State Department oflnfrastructure.

Objective: The key objective of the project is to; a) Increase the efficiency of road transport along the Northern Corridor and the Tanzania-Kenya­

Sudan road corridor b) Enhance aviation safety and security to meet international standards, and c) Improve institutional arrangements and capacity in the transport sector

Address: The project offices are State Department of Infrastructure, Nairobi, Kenya

Contacts: The following are the project contacts

Telephone: (02) 27230101 E-mail: ps@roads.go.ke Website: www;roads.go.ke

1.2 Project Information

Proiect Start Date: 22nd April, 2011

Project End Date: 31st December, 2016 ,.

Project Manager: Chief Eng. Patrick M. Mwinzi

1.3 Project Overview

Line Ministry/State The project is under the supervision of State Department of Infrastructure. Department of the proiect

Proiect number Pl24109

Strategic goals of the The strategic goals of the project are as follows: project (i) Institutional strengthening and capacity building in the transport

sector

Achievement of The project management aims to achieve the goals through the following strategic goals means:

(i) Support and enhance operations ofN.C.A. and E.B.K.

(ii) Study the role and impact of the new constitution regarding State

i

KENYA TRANSPORT SECTOR SUPPORT PROJECT

ReportS ind Financial Statements For the fiaaadal year ended June 30, 2014

Department oflnfrastructure visa-vis the different Departments and Authorities under them,

(iii) Facilitate for Monitory and evaluation for the Project

(iv) Training Manpower in KRB, ERD, State Law and SDol, and

(v) Inventory of unclassified roads and recommendation thereof for maintenance and Management

Current situation that The project was formed to intervene in the following areas: the project was (i) Challenges faced in the implementation ofNUTRIP project formed to intervene (ii) Coming into effect of the New Constitution

1.4 Bankers

The following are the bankers for the current year: (i) Central Bank of Kenya

Haile Selassie A venue P.O. Box 60000 City Square 00200 Nairobi, Kenya ....

1.5 Auditors

Auditor General Kenya National Audit Office Anniversary Towers, University Way P.O. Box 30084 GPO 00100 Nairobi, Kenya

1.6 Roles and Responsibilities

Below is a list of different people who are working on the project. This list includes the project mana er and all the ke stakeholders who are involved with the ro· ect

Bachelor's De ree

1. 7 Funding summary

The Project is for duration of 6(six) years from confirm this against 1.2 above 2011 to 2016 with an approved budget of US$M 17.47 equivalent to Kshs 1.5 Billion in respect to State Department of Infrastructure as highlighted in the table below:

11

KENYATRANSPORTSECTORSUPPORTPROJECT

. ~ . Reports and Financial Statements For tile fiuacial year ended June 30, 2014

Below is the funding summary:

I ! I j I ----·-- --·~---·---··--···· ·- --··-·-- ---···-··----···---·- ----·····--_L·····-·····--·-___ .J 17,470,000 1 1,489,300,000 1,093,971 92,854,203 i 16,376,029 11,396,445,797 .

I . . --··--------1-----------i----··-··--· -··--··---··---··---··-- -····-···-----··-·-· --------------! funisounterpart I ] 1 · I l . l

I Govemm- e-nt_o_f _-+!- - \ 29,142,000 I -I 29,142,000 I - I · ~ I Kenya 1 I I 1 I L_ -···--···-···---1----·-·-- ~-+---·-··· ····--1---------1-----··-··--J------- . -=--I ~· 17,470,000 I 1,518,442,QOO I 1,093,971 i 121,996,203 I 16,376,029 i 1,396,445,792.J

1.8 Summary of Overall Project Performance:

Budget performance against actual amounts for current year and for cumulative to-date.

1.9 Summary of Project Compliance:

We have not had any cases of non-compliance with applicable laws and regulations in the year. The projects has complied with the financing agreements with World Bank.

iii

KENYA TRANSPORT SECTOR SUPPORT PROJECT

Reports and Financial Statements For the fin • year ended June 30, 2014

2. STATEMENT OF PROJECT MANAGEMENT RESPONSIBILITIES

The Principal Secretary for the State Department of Infrastructure and the Project Team Leader for KTSSP project are responsible for the preparation and presentation of the Project's financial statements, which give a true and fair view of the state of affairs of the Project for and as at the end of the financial year (period) ended on June 30, 2014. This responsibility includes: (i) maintaining adequate financial management arrangement and ensuring that these continue to be effective throughout the reporting period; (ii) maintaining proper accounting records, which disclose with reasonable accuracy at any time the financial position of the Project; (iii) designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of the financial statement, and ensuring that they are free from material misstatements, whether due to error or fraud; (iv) safeguarding the assets of the Project; (v) selecting and applying appropriate accounting policies; and (vi) making accounting estimates that are reasonable in the circumstances.

The Principal Secretary for the State Department of Infrastructure and the Project Team Leader for •· KTSSP project accept responsibility for the Project's financial statements, which have been prepared on the Cash Basis Method of Financial Reporting, using appropriate accounting policies in accordance with International Public Sector Accounting Standards.

Thec1?rincipal Secretary for the State Department of InfraStructure and the Project Team Leader for KTSSP project are of the opinion that the Project's financial statements give a true and fair view of the state·of Project's transactions during the financial year/period ended June 30, 2014, and of the Project's :financial position as at that date. The Principal Secretary for the State Department of Infrastructure and the Project Team Leader for KTSSP project further confirm the completeness of the accounting records maintained for the Project, which have been relied upon in the preparation of the Project financial statements as well as the adequacy of the systems of internal financial control.

The. Principal Secretary for the State Department of Infrastructure and the Project T earn Leader for KTSSP project confirm that the Project has complied fully with applicable Government Regulations andi'the terms of external financing covenants, and that Project funds received during the financial year/period under audit were used for the eligible purposes for which they were intended and were properly accounted for.

Approval of the Project financial statements

The Project financial statements were approved by the Principal Secretary for the State Department of Infrastructure and the Project Te Leader for KTSSP project on 2014 and signed by them.

ENG. SO NIK PRINCIPAL SECRETARY

iv

ENG.~ M. MWINZI PROJECt TEAM LEADER

KENYATRANSPORTSECTORSUPPORTPROJECT . .. . Reports aad Fiaucial Statements For dte &inndlll year ended June 30, 2014

3. REPORT OF THE INDEPENDENT AUDITORS ON THE NUTRIP PROJECT

REPORT ON FINANCIAL STATEMENTS

We have audited the accompanying financial statements of KTSSP project, set out on pages I to 14 which comprise the statement of receipts and payments for the financial year ended June 30, 2014, and a summary of significant accounting policies and other explanatory notes.

Responsibility for the Financial Statements

The Principal Secretary for the State Department of Infrastructure and the Project Team Leader for KTSSP project are responsible for the preparation and fair presentation of these financial statements in accordance with International Public Sector Accounting Standards (IPSAS). ·This responsibility includes designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of financial statements that are free from materiar'misstatement, whether due to fraud or error, selecting and applying appropriate accounting policies, and making accounting estimates that are reasonable in the circumstances. ·. ·

Auditor's Responsibility

Our responsibilitY:is to express an independent opinion on these financHtl statements based on our audit. We conducted our audit in accordance with International Stai\dards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involveS<':performing procedures to obtain audit evidence about·the amounts and disclosures in the financial statements. The procedures selected depended on our professional judgement, including the assessment of the risks of material misstatement of the ~ancial statements, whether due to fraud or error. In making those risk assessments, we considered the-.internal controls relevant to the company's preparation and fair presentation of the financial statements in order to design audit procedures that were appropriate in the circumstances, but not for the purpose of expressing an opinion on the company's internal controls. An audit also includes evaluating the appropriateness of accounting polices used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion the accompanying financial statements give a true and fair view of the state of financial affairs of the KTSSP project for the financial year/ ended June 30, 2014 in accordance with International Public Sector Accounting Standards (IPSAS).

v

K.ENYATRANSPORTSECTORSUPPORTPROJECT

. - . Reperts aect Fillueial Statements For tile ftaarcial 7•r ended June 30, 2014

4. STATEMENT OF RECEIPTS AND PAYMENTS FOR THE YEAR ENDED 30TH JUNE 2014

RECEIPTS

Transfer from Government entities Loan from external Development Partners Miscellaneous receipts

Total receipts

PAYMENTS

Compensation of employees Purchase of goods and services Acquisition of non-financial assets

TOTAL PAYMENTS

Note 2014 Kshs

2013 Kshs

8.2 29,142,000 8.3 34,058,598 58,756,605 8.5 39,000

Cumulative to-date Kshs

29,142,000 92,815,203

39,000

34,097,598 87,898,605 121,996,203

8.6 8.7 43,160,644 34,504,441 77,665,085

25,727,910 1~ 8.9 25,727,910 . '

68,888,554 34,504,441 103,392,995

SURPLUS/DEFICIT FOR THE YEAR ·:i (34, 790,956) 53,394,164 18,603,208

The accounting policies and explanatory notes to these financial statements are an integral part of the financial statements.

ENG. JO N K. MOSONIK PRINCIPAL SECRET ARY

Date

1

ENG. -P~K M. MWINZI PROJECT TEAM LEADER

;tsl° \\ \ ~01 Lf

Date

KENYATRANSPORTSECTORSUPPORTPROJECT

• • Reports and Financial Statements For the financial year ended June 30, 2014

5. STATEMENT OF FINANCIAL ASSETS AND LIABILITIES AS AT 30TH JUNE 2014

FINANCIAL ASSETS

Cash and Cash Equivalents Bank Balances

TOTAL FINANCIAL ASSETS

REPRESENTE BY:

Cash and cash equivalents b/fwd Surplus/Deficit for the year Prior year adjustments

NET FINANCIAL POSITION

Note 2014 2013 Kshs Kshs

8.12A 18,603,208 53,394,164

18,603,208 53,394,164

8.13 53,394,164 (34, 790,956) 53,394, 164

8.14

18,603,208 53,394,164

The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. The financial statements were approved on 2014 and

y:

Date

2

ENG. ~KM. MWINZI PROJEC'P'l'EAM LEADER

;)...S--f \ \ 1 ~Of If Date

6.

KENYATRANSPORTSECTORSUPPORTPROJECT

• • • Reports lllld li'iaucial Statements tror tile ftspp eial year ended June 3&, 2014

STATEMENT OF CASHFLOW FOR THE YEAR 30™ JUNE 2014

Receipts for operating income Transfer from Government entities 29,142,000 Loan from external Development Partners Miscellaneous receipts . 39,000

Payments for operating expenses Compensation of employees Purchase of goods and services (43,160,644) (34,504,441)

Net cash flow from operating activities (4321212644} (5.3622441}

CASHFLOW FROM INVESTING ACTIVITIES Acquisition of Assets (252 727 2910) Net cash flows from Investing Activities (25,727,910)

CASHFLOW FROM BORROWING ACTIVITIES Proceeds from Foreign Borrowings 3420582598 5827562605 Net cash flow from fmancing activities 34,058,598 58,756,605

NET INCREASE IN CASH AND CASH (34, 790,956) 53,394,164 EQUIVALENT Cash and cash equivalent at BEGINNING of the 5323942164 --year Cash and cash equivalent at END of the year 1826032208 53.3942164

The accounting policies and explanatory notes to these financial statements form an integral part of the financial statements. These financial statements were approved on 2014 and signed by:

ENG. JOHN . 0 ONIK PRINCIPAL SECRETARY

Date Date

3

ENG. AM. MWINZI PROJECT TEAM LEADER

·~'

KENYATRANSPORTSECTORSUPPORTPROJECT

Reports and Financial Statements For die hweial year ended June 30, 2014

1. STATEMENT OF COMPARATIVE BUDGET AND ACTUAL AMOUNTS

Actual on %of Original Adjustment Final Comparab Varia

Receipts/Payments Item Bud2et s Bud2et le Basis Variance nee

a b c=a+b D e=d-c f=e/c %

Receipts

Proceeds from borrowings 50,000,000 (15,000,000) 35,000,000 34,058,598 (941,402) -3%

Miscellaneous receipts - - - 39,000 39,000

Total Receipts 50,000,000 (15,000,000) 35,000,000 34,097,598 {902,402) -3%

Payments - - - - - -Purchase of goods and services 70,000,000 (25,000,000) 45,000,000 43,160,644 (1,839,356) -04%

Social security benefits - - - - - -r-"quisition of non-financial assets 25,000,000 - 25,000,000 25,727,910 727,910 3%

i fotal Payments 95,000,000 (25,000,000) 60,000,000 68,888,554 (2,462,010) 3.4%

Note: The sigt):ificant budget utilisation/performance differences in the last column are explained in Annex 1 to these financial statements.

4

,. KENYA TRANSPORT SECTOR SUPPORT PROJECT

R~ports 'aacl Financial Statements Por tile ftla•eial year ended Jane 30, 2014

b. NOTES TO THE FINANCIAL STATEMENTS

The principal accounting policies adopted in the preparation of these financial statements are set out below:

8.1 Statement of compliance and basis of preparation

The financial statements have been prepared in accordance with and comply with International Public Sector Accounting Standards (IPSAS) with particular emphasis on Cash Basis Financial Reporting under the Cash Basis of Accounting. The financial statements comply with and conform to the form of presentation prescribed by the Accounting Standards Board of Kenya.

The financial statements are presented in Kenya Shillings, which is the functional and reporting currency of the Project and all values are rounded to the nearest one Shilling. The accounting policies adopted have been consistently applied to all of the years presented.

The financial statements have been prepared on the cash basis· -following the Government's standard chart of accounts. The cash basis of accounting recognises transactions and events only when cash is received or paid out by the Project.

1. Recognition of revenue and expenses

The Project recognises all revenues from the various sources when the event occurs and the related cash has actually been received by the Project. In addition, the Project recognises all expenses when the event occurs and the related cash has actually been paid out by the Project.

11. In-kind donations

In-kind donations are contributions made to the Project in the form of actual goods and/or services rather than in money or cash terms. These donations may include vehicles, equipment or personnel services. Where the financial value of in-kind donations can be reliably determined, the Project includes such value in the statement of receipts and payments both as revenue and as an expense in equal and opposite amounts; othei:wise, the donation is not recorded.

111. Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and c~h at bank, short-term deposits on call and highly liquid investments with an original maturity of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant risk of changes in value. Bank account balances include amounts held at the Central Bank of Kenya and at various commercial banks at the end of the financial year. For the purposes of these financial statements, cash and cash equivalents also include short term cash imprests and advances to authorised public officers and/or institutions which had not been surrendered or accounted for at the end of the financial year.

5

Rcporjs find Financial Statements •· For the financial year ended June 30, 2014

SIGNIFICANT ACCOUNTING POLICIES (Continued)

iv. Pending bills

Pending bills consist of unpaid liabilities at the end of the financial year arising from contracted goods or services during the year/period or in past years. As pending bills do not involve the payment of cash in the reporting period, they are simply disclosed as an Annex to the financial statements. When the pending bills are finally settled, such payments are included in the statement of receipts and payments in the year in which the payments are made.

v. Budget

The budget is developed on the same accounting basis (cash basis), the same accounts classification basis, and for the same period as the financial statements. The Project's budget was approved as required by Law and National Treasury Regulations, as well as by the participating development partners, as detailed in the Government of Kenya Budget Printed Estimates for the year. A high-level assessment of the Project's actual performance against the comparable budget for the financial year/period under review has been included in an annex to these financial statements.

vi. Exchange rate differences

The accounting records are maintained in the functional currency of the primary economic environment in which the Project operates, Kenya Shillings. Transactions in foreign currencies during the year/period are converted into the functional currency using the exchange rates prevailing at the dates ofthe transactions. Any foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statements of receipts and payments.

i . Comparative figures

Where necessary comparative figures for the previous financial year/period have been amended or reconfigured to conform to the required changes in financial statement presentation.

vni. Subsequent events

There have been no events subsequent to the financial year/period end with a significant impact on the financial statements for the year ended June 30, 2014.

6

KENYATRANSPORTSECTORSUPPORTPROJECT

• • ·• Reports and Financial Statements

For the financial year ended June 30, 2014

8.2 RECEIPTS FROM GOVERNMENT OF KENYA

These represent counterpart funding and other receipts from government as follows:

2013/14 2012/13 Cumulative Kshs Kshs to-date

Counterpart funding through Ministry of Transport Counterpart funds Quarter 1 29,142,000 29,142,000

--29,142,000 29,142,000

== == ==

8.3 LOAN FROM EXTERNAL DEVELOPMENT PARTNERS

During the 12 months to 30 June 2014 we received fundilig from development partners in form of loans negotiated by the National Treasury donors as detailed in the table below:

Name of Donor

Loans Received from Multilateral Donors nternatiomtf Or anisations

World Bank

Date recei \'ed

24/04/2014

Amount Loans in loan rcrcived in

currency cash

Kshs

34,058,598

Loans Total amount in Kshs rcreived as direct pa:nnent

"" FY 2012/13 FY 2011 /12

Kshs Kshs Kshs

34,058,598 58,756 605

Total 34,058,598 _ 58,756,605

8.4 MISCELLANEOUS RECEIPTS

Other receipts not classified elsewhere

7

FY 2013/14 Kshs

39,000

39,000

FY 2012/13 Cumulative Kshs Kshs

39,000

39,000 === ==

KENYATRANSPORTSECTORSUPPORTPROJECT

R~ports and Financial Statements For the financial year ended June 30, 2014

NOTES TO THE FINANCIAL STATEMENTS (Continued)

8.5

8.6

PURCHASE OF GOODS AND SERVICES

2013/14 2012/13 Cumulative

Kshs Kshs to date

Utilities, supplies and services 9,419,070 533,980 9,953,050 Communication, supplies and services 4,000,344 4,000,344 Training expenses 13,714,026 33,484,985 47,199,011 Hospitality supplies and services 12,123,018 12,123,018 Other operating expenses 3,904,186 485,476 4,389,662

43,160,644 34,504,441

ACQUISITION OF NON-FINANCIAL ASSETS 2013/14

Kshs

Purchase of vehicles & other transport equipment 25,727,910

25,727,910

77,665,085

2012/13 Kshs

Cumulative to-date

25,727,910

- 25,727,910

8.7 CASH AND CASH EQUIVALENTS C/FWD

2013/14 2012/13 Kshs Kshs

Bank accounts (Note 12A) 18,603,208 53,394,164

18,603,208 53,394,164 ===

8.7A Bank Accounts

Local Currency Accounts Central Bank of Kenya 18,603,208 53,394,164

Total bank account balances 18,603,208 53,394,164 -----

8

KENYA TRANSPORT SECTOR SUPPORT PROJECT

'ltep'orls aad Financial Statements For the tlllallcial year ended June 30, 2014

9. PENDING BILLS (Annex A)

Some expenditure that was incurred was erroneously paid from NUTRIP project instead of K. T .S.S.P. This will however be refunded to NUTRIP in this current year and be accowited for accordingly. The paym~nt to NUTRIP is therefore recognised as Pending Bills and analysed as follows:

En£. S. K Ko£i 536,355.00 Setym International 531,000.00 Millicent Ngare 165,000.00

Total Payable to NUTRIP account 1,232,355.00

9

KENYATRANSPORTSECTORSUPt~TPROJECT Reports and Financial Statements For the financial year ended June 30, 2014

9. PROGRESS ON FOLLOW UP OF AUDITOR RECOMMENDATIONS

The following is the summary of issues raised by the external auditor, and management comments that were provided to the auditor. We have nominated focal persons to resolve the various issues as shown below with the associated time frame within which we expect the issues to be resolved.

Referen ce No. on the

Issue /Observations from Auditor external

audit Report

NONE IN THE YEAR

ENG. J · . MOSONIK PRINCIPAfJ SECRETARY

-

Management comments

: . '

ENG.P&M.MWINZI PROJECT'TEAM LEADER

.. -

I Focal Point Status:

Timeframe: person to

(Resolved I (Put a date

resolve the Not

when you issue (Name

Resolved) expect the

and issue to be desi211ation) resolved}

---------------·--

+-----· I --

..

I