Audited Project Financial Statements

Project Number: 38255-043 Loan Number: 3040 Period covered: 1 April 2014 to 31 March 2015

IND: Uttarakhand State Roads Investment Program – Project 3 Prepared by Public Works Department, Government of Uttarakhand

For the Asian Development Bank Date received by ADB: 9 December 2015 The audited project financial statements are documents owned by the borrower. The views expressed herein do not necessarily represent those of ADB’s Board of Directors, Management, or staff. These documents are made publicly available in accordance with ADB’s Public Communications Policy (2011) and as agreed between ADB and Public Works Department, Government of Uttarakhand.

Audit Report & Financial Statements

For The Year Ended

31't March 2015

Uttarakhand State Road Investement

Programme

Project Ma nagement U n it P.V1i/. D"

ADB Project

Engineers Enclave

Dehra Dun

Auditors

GULATI & CO.Chartered Accountants

22, New Roa , Dehra Dun

Tel: 2557769,3250974

Gulati &Co.,CHARTERED ACCOTINTAN|S22 - New Road, Detra Dun

The Project Director,

Uttarakhand State Road Investment Programme,

Project Management Unit P.W.D. ADB Project,

Engineers Enclave, Dehra Dun, UTTARAKHAND.

Report on the Project Financial Statements

We have audited the accompanying financial statements of the Uttarakhand State Road lnvestment Programme,Project Management Unit ,P.W.D. ADB Project frolect financed under Asian Development Bank Loan No. 2308,

2458 & 3040 which comprise the Statement of Receipts & Payments, the Statement of Expenditure by Catagory of

Financer, the Statement of Disbursement and related notes for the year ended 31$ March 2015.

These statements are the responsibility of the Project's management. Our responsibility is to express an opinion on

the accompanying financial statements based on our audit,

We conducted our audit in accordance with the Auditing Standards promulgated by the Comptroller and Auditor

General of India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about

whether the financial statements are free of material misstatement. Our audit examines, on a test basis, evidence

supporting the amounts and disclosures in the financial statements. lt also includes assessing the accountingprinciples used and significant estimates made by management, as well as evaluating the overall statement

presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements read together with appended notes to accounts present fairly, in all material

respects, the sources and applications of funds of Project for the year ended 31$ March 2015 in accordance with

Government of India accounting standards.

In addition, in our opinion;

(a) Proceeds of the loan ftom ADB have been utilized for the purposes as per ADB Loan / Project Agreement.

(b) Financial covenants in the loan agreement No. 2308, 2458 &3040 have been complied with.

(c) With respect to SOEs, adequate supporting documentation has been maintained to support claims to the Asian

Development Bank for reimbursements of expenditures incuned; and (b) except for ineligible expenditures as

detailed in the audit observations, if any, appended to this audit report, expenditures are eligible for financing under

the Loan Agreement.

This repoil is issued without prejudice to CAG's right to incorprate the audit observations in the Report of CAG of

India for being laid before ParliamenUState or UT Legislature,

For GULATI & CO.Chartered Accountants

Dehra Dun

Dated: 21-09-2015

(Ashok Gulati)FCA, D|SA (rCAr)

Mem. No. 071 193

Fkm No.001981C

UTTARAKHAND STATE ROAD INVESTMENT PROGRAMME

PROJECT MANAGEMENT UNIT P.W.D. ADB PROJECT

ENGINEERS ENCIAVE, DEHRA DUN

[oan/ No. 2308,2458 & 3o4o

STATEMENT OF RECEIPTS AND PAYMENTS

REPORT FOR THE YEAR / p D ENDED 31.03.2015

Receipts

Funds Receved from Government

ADB Loan

ADB Grant

Co - financier 1

Co - financier 2

Beneficiary Contribution (lf any )

Other receipts Such as Interest Income, Sale From of fixed assets etc.

Total ( c=A+B)

Cost (G=D+E+F

Notes 1 to 10 oftheFinancial Statements form an integral part ofthese financial statements.

Dehra Dun

Dated: A-ol-ts-

INR )'000

4.2

4.7

Annexure 1

LL,33,722

4,55,193

Investment Costs

Civil Works

Mechanical and Equipment17,70,973

21,232

20,559

L,44,59O

t4,o8,L0L

57,90o

42,65L

67,794

r,08,67,604

L,76,56L

3,19,900

9,55,091

Equipment Operation and Maintenance

FoTGULATI & CO.,

Project Director

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1.

UTTARAKHAND STATE ROAD INVESTMENT PROGRAMMEPROJECT MANAGEMENT UNIT (P. W.D. A.D.B. Project)

ADB Loan Agreements No 2308, No 2458 and No 3040 IND USRIP Projects

Annexure 4Notes to the Financial Statements for the Year Ended 31-0&2015.

BACKGROUND

1.1 PROIECT NATURE AND ACTIVITIES:The project is Uttarakhand's State-Road Investrnent Program to which ADB hasagreed to provide a multi-tranche financing facility.

1.2 PROJECT 1 FINANCTNG PLAN:Government of India has signed a loan agreement with Asian Development Bank andsubsequently Project Agreement has been signed by Uttarakhand Government withAsian Development Bank (vide Loan Agreement No 2308IND USRIP Project 1). Theallocation and withdrawal of loan for Project 1 is for Civil Work45 Million Dollar andConsulting Services-S Million Dollar. The share of State Govemment is equivalent to24 Million Dollar.

1.3 PROJECT 2 FTNANCTNG PLAN:Government of India has signed a loan agreement with Asian Development Bank andsubsequently Project Agreement has been signed by Uttarakhand Government withAsian Development Bank (vide Loan Agreement No 2458IND USRIP Project 2). Theallocation and withdrawal of loan for Project 2is for Civil Work-126.80 Million Dollarand Consulting Services- L3.20 Million Dollar. The share of State Govemment isequivalent to 60 Million Dollar.

1.4 PROJECT 3 FTNANCTNG PLAN:Government of India has signed a loan agreement with Asian Development Bank andsubsequently Project Agreement has been signed by Uttarakhand Government withAsian Development Bank (vide Loan Agreement No 3040IND USRIP Project 3). Theallocation and withdrawal of loan for Project 3.is for Civil Work- 130.11 Million Dollarand Consulting Services- 19.89 Million Dollar. The share of State Government isequivalent to 77 .55 Million Dollar.

1.5 OPERATIONS:There is one Project Management Unit located at Dehradun and Eleveen ProjectImplernentation Units based at Joshimatl-r, Dehradun, Tehri, Pauri, Duggad4uttarkashi, Pithoragarh, Nainital, Almora, Bageshwar & udham singh Nagar. TheProject consists of improvement of roads in Uttarakhand.

COMPLIANCE WITH ACCOUNTING STANDARDSThese financial statements have been prepared in accordance with approved accountingstandards, as applicable in India. This refers to the cash basis of accounting applied withdue regard to the General Financial Rules, PWD Codes, Treasury Codes, and similarfinancial rules and codes as are in effect and to ihe operations of the project.

c

i2i

3. SIGNIFICANTACCOUNTINGPOLICIES

3.L Financial Statements

This comprises of Statement of Receipts and Payments, ttre Statements of Expenditure

by Category and Financier, the Statement of Disbursement and related notes and

appendices to the financial statements.

3.2 Basis of measurement :-

Financial statements have been prepared under the historical cost convention and oncash basis of accounting. The Accounts received from Project Management Unit atDehra Dun and Project lmplementation Units at Joshimath, Dehradun, Tehri, Pauri,Duggad4 Uttarkashl Pithoragarh, Nainital, Almora, Bageshwar & Udham SinghNagar are maintained on cash basis and financial statements are drawn accordingly.

3.3 Changes in Accounting policies

The principal accounting policies set below have been consistently followed in allmaterial respects. There has been no changes in accounting policies during the year.

3.4 Fund Flow mechanismThe projects are under PWD and all the expenditure is initially done by PIUs underPWD . The Project Implementing Units (PIUs) make all the payments are throughCCL and DCL system.

3.5 Advances and other receivables

Advances to contactors/consultants are adjusted against their running bills.

3.6 Cash and cash equivalents

Cash equivalents comprise of Cash in Chest has a nil balance at the end of the year.

3.7 Accrued and other liabilitiesNo major liability except for Running Bills for Civil Work in progress as cash basispolicy is being followed.

3.8 Income

Being non revenue earning projects income and expenditure is not prepared howeverfree of cost office space for certain PIS's provided by PWD are not valued.

3.9 Foreign currency transactions and translation.Payments to Foreign Consultants are converted at the exchange rate prevailing at thedate of traruaction.

3.10 Allocation of Common Costs.

Common costs/expenditure on Fixed Assets & Administrative Expenses for the yearhave been allocated to Project I, Project II & Project III in proportion to expenditure on

1941C

roads.

:3:

3.11 Interest Expenses and Finzrncial ChargesInterest on loan is being paid by Government and the same is not accounted for in thestatements.

3.12 Fixed Assets:

The fixed assets acquired for the operation and maintenance of Project ManagementUnit and Project Implementation Units have been recorded at cost of acquisition.Depreciation has not been provided on the fixed assets.

NOTES TO ACCOUNTS4.1 Loans disbursed by ADB :

ADB has disbursed loan as detailed under as per terms of loan agreement.

in'000PROJECT LOAN AGREMENT NO AMOUNT DISBURSED INRProject 1 2308IND USRIP 7UW88Proiect 2 2458IND USRIP 5318432Proiect 3 3O4O IND USRIP 7725il0

Toral Rs. 8293760

Funds Received from the Government.Funding mechanism:-The projects are under Pl4trD and all the expenditure is initiallydone by P\ArD. The ADB's Share is then reimbursed by ADB on the basis of Claimssubmitted.

Govemment counterpart funding balance:

in'000PARTICULARS AMOUNTOpening Balance 402W32Expenditure During The Year 1980635

Sub Total 60r0ffi7Reimbursed Durine The Year

ADB Loan 1930380Balance As on 31.03.2015 408m87

5. DATEOFAUTHORIZATION

Place: Dehra DunDated:

].t.Oq,F{ff

4.2

These financial statements have been authorize

(Project tor) (Superinren

FoTGULATI & CO.Chartered Accountants

(Ashok Gulati)

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