MINISTRY FOR DEMOGRAPHY, FAMILY, YOUTH AND SOCIAL …documents.worldbank.org/curated/en/...Dec 31,...

HLB Inlenjerski biro d.o.o.Rijeka, Strossmayerova 11T 051 322 303F 725 377

Inzenjerski Biro E [email protected] 1 www,ibr.hr

INDEPENDENT AUDITOR'S REPORT ON FINANCIAL STATEMENTS FORTHE ,,SOCIAL PROTECTION SYSTEM MODERNIZATION PROJECT"

REPORTING YEAR 2016

MINISTRY FOR DEMOGRAPHY, FAMILY,YOUTH AND SOCIAL POLICY

ZAGREBREPUBLIC OF CROATIA

Rijeka, June 2017

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FINANCIAL STATEMENTS FORTHE "SOCIAL PROTECTION SYSTEM

MODERNIZATION PROJECT"FOR

LOAN PERIOD PHASE FOR 2016

MINISTRY FOR DEMOGRAPHY, FAMILY, YOUTHAND SOCIAL POLICY

ZAGREB

Zagreb, May 2017

MINISTRY FOR DEMOGRAPHY, FAMILY, YOUTH AND SOCIAL POLICY

Table of contents

INDEPENDENT AUDITOR'S REPORT ON FINANCIAL STATEMENTS FOR THE ,,SOCIAL PROTECTION SYSTEMMODERNIZATION PROJECT", FOR THE WORLD BANK CONSIDERATION ................................................................. I

FINANCIAL STATEMENTS 2016 - THE SOCIAL PROTECTION SYSTEM MODERNIZATION PROJECT (IBRD LOAN8426H R).................................................................................................................................................................I

RESPONSIBILITY FOR ENCLOSED FINANCIAL STATEMENTS.....................................................................................1

1. INTRO DUCTIO N ............................................................................................................................................ 2

2. GENERAL INFORMATION .............................................................................................................................. 2

2 .1. IN T R O D U C T IO N .......................................................................................................................................... 22.2. PROJECT IMPLEMENTATION PROGRESS ................................................................................................ 2

2.3. M AIN PROJECT CO M PO N ENTS ................................................................................................................... 32.3.1. Component 1 - Improving Efficiency and Effectiveness of the Social Protection System (IBRD Euro 50million) 32.3.2. Component 2 - Investments and Technical Assistance to Support Improvements in Efficiency and

Effectiveness of the Social Protection System (IBRD Euro 19,4 million) .......................................................... 4

2.3.3. Component 3- Project Management Support (IBRD Euro 0,6 million)..................... 4

2.4. PROJECT FINANCING BY THE IBRD LOAN.................................................................................................... 52.4.1. G eneral inform ation .............................................................................................................................. 52 .4 .2 . Project financing ................................................................................................................................... 5

2.5. LO A N A PPLICA T IO N.................................................................................................................................... 62 .5 .1. G en era l rem a rks.................................................................................................................................... 62.5.2. Project Preparation Advance (PPA) - the PPA Phase 2014 (ending on December 23, 2014)............. 62.5.3. Lo n Phase - application from January 1, 2015 ............................................................................... 7

3. REPORTING AND ACCOUNTING FRAMEWORK ........................................................................................... 8

3.1. REPO RTIN G FRA M EW O R K ....................................................................................................................... 83.2. ACCO U NTING FRA M EW O R K ...................................................................................................................... 8

4. BASIC DEFINITIONS AND CONVENTIONS .................................................................................................. 9

4 .1. D EFIN IT IO N S .............................................................................................................................................. 94 .2 . C O N V E N T IO N S ........................................................................................................................................... 9

5. STATEMENT OF FUNDING SOURCES AND EXPENDITURES, INDICATING IBRD SOURCES AND AGGREGATEEXPENDITURES BY MAJOR CATEGORIES FOR PRECEDING PERIOD, CURRENT PERIOD AND AGGREGATEEXPENDITURES ON REPORTING DATE .................................................................................................................. 10

5 .1. IN T RO D U CT IO N ........................................................................................................................................ 105.2. STATEMENT ON PROJECT SOURCES AND EXPENDITURES ........................................................................ 115.3. IBRD LO A N 8426H R BA LA N CE .................................................................................................................. 12

5.3.1. Breakdown of changes throughout 2016......................................................................................... 125.4. DETAILED BREAKDOWN OF PROJECT EXPENDITURES DURING 2016 AND AGGREGATED ON DECEMBER31, 2016 13

5.4.1. Expenditures, by Project cate go ries ....................................... ................................ 135.4.2. Project expenditures, by Project components.................................................................................. 14

6. STATEMENT OF EXPENDITURES (SOE) - SUPPORTING DOCUMENTATION ................................................ 15

6 .1. IN T RO D U CT IO N ........................................................................................................................................ 156.1.1. Statement of expenditures - SoE for withdrawals in 2016, by suppliers ........................................ 166.1.2. Payments to Designated Account based on withdrawal application and auditor's obligation toexam ine these paym ents................................................................................................................................... 17

7. STATEMENT OF PROJECT DESIGNATED ACCOUNT IN 2016 ..................................................................... 17

MINISTRY FOR DEMOGRAPHY, FAMILY, YOUTH AND SOCIAL POLICY7.1. BACKGROUND OF DESIGNATED ACCOUNTS .............................................. 17

7.1.1. Designated Account at RBA d.d. in 2014 -the PPA phase.............................. 177.1.2. Designated Account at CNB.................................................. 187.1.3. Operations Account at the Treasury, through which Designated Account at CNB operates....... 18

7.2. STATEMENT OF PROJECT DESIGNATED ACCOUNT ..................................... ..... 197.2.1. Statement of Designated Account in EUR, at CNB (NOT INCLUDING TRANSFERS TO THE OPERATIONSACCOUNT IN HRK CURRENCY), I.E. BALANCE OF THE OPERATIONS ACCOUNT, CONVERTED TO LOANCURRENCY* .................................................................... 1972.2, Statement of the Operations account, at the Treasury, in HRK currency ......... ........... 207.2.3. Balance Sheet..... ....................................................... 207.2.4, Interests ................................................................ 207.2.5. Applied exchange rate and rate differences ....................................... 20

7.3. DETAILED OVERVIEW ............................................................... 227.3.1. Specific withdrawals to Designated Account, in 2016.................................. 227.3.2. Individual payments from the Operations Account in 2016, including types of contracts and paidexpenditures ................................................................... 22

HLB Inienjerski biro d.o.o.Rijeka, Strossmayerova 11HerT 051 322 303

Inkenjerski Biro F 725377E [email protected]

INDEPENDENT AUDITOR'S REPORT ON FINANCIAL STATEMENTSFOR THE ,,SOCIAL PROTECTION SYSTEM MODERNIZATIONPROJECT", FOR THE WORLD BANK CONSIDERATION

Ministry for Demography, Family,Youth and Social Policy

Nevenke Topalusi 1, ZagrebLoan Manager

Opinion

We have audited the 2016 financial statements of the Social Protection System Modernization Project(hereinafter: the "Project"), prepared by the Project team at the Ministry for Demography, Family, Youthand Social Policy (hereinafter: the "Subject"). The financial statements comprise the Statement of Projectfunding sources and expenditures, the Statement ofExpenditures, the Statement of Designated Account andcorresponding notes and clarifications, in respect of the Project. The Project is funded thorugh theInternational Bank for Reconstruction and Development (hereinafter: the "Bank"), under the LoanAgreement No. 8426-HR. The statements are presented on pages 1-33.

In our opinion, the accompanying financial statements give fair view of the Project's funding sources,expenditures, Statements of Expenditures (hereinafter: the "SoE") used for withdrawal application,and the balance of Project Designated Account in 2016, in relation to the Project funded by the TBRDloan no.8426HR, and in compliance with reporting framework prescribed by the Bank.

Basis for Opinion

We have audited financial statements in line with the International Auditing Standards (IAS) and the Bank's"Guidelines-Annual financial reporting and auditing for World Bank-financed activities" of June 30, 2003,provisions of the Contract for Consulting Services SPSMP-CS-LCS/AUDIT-23 (hereinafter: the"Contract"), of June 15, 2016, and special provisions of the Contract regarding Summary Reports andDesignated Account. In addition, we have also taken into account provisions and instructions from thefollowing manuals:

* Loan Handbook for World Bank Borrowers, May 2016;* Disbursement Handbook for World Bank Clients, May 2006;* Guidelines : procurement of goods, works, and non-consulting services under IBRD loans and IDA

credits and grants by World Bank borrowers (as revised, July 2014);* Guidelines : selection and employment of consultants under IBRD loans and IDA credits and

grants by World Bank Borrowers, January 2011 (as revised, July 2014).

Our responsibilities, in accordance with those standards, are further described in detail in Auditor'sResponsibilities for the Audit of the Financial statements section of our report. We are independent from

I

the audited Subject, in accordance with the Code of Ethics for Professional Accountants (IESBA Code).We have fulfilled our other ethical responsibilities in accordance with the ISBA Code. We believe that theaudit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Enphasis of'Matters

1. We draw attention to points 7.1 .and 7.2. which explicate the function of Designated Account (hereinafter:the "DA") opened at the Croatian National Bank (hereinafter: the "CNB") and how its Operations Accountat the Treasury functions in practice, including application of the FIFO method on the exchange rate inthe process of funds transfer from the DA to the Operations Accoun at the Treasury.

2. Also, we draw attention to note 3.Reporting Framework and accounting basis which sets forthdistinctive features of drafting these financial statements. These financial statements focus on reportingframework based on cash basis. They also focus on type of statements reports that make up a coiipleteset of these financial statements. For that reason, these financial statements may be inadequate forpurposes other than those defined in the reporting framework. However, our opinion is not consideredas modified.

3. Point 2.2 indicates the change of Subject's official name in October 2016, pursuant to Article 2 of the Acton Organization and Scope of Ministries and Other Central State Administration Bodies (Official Gazette,93/16). The former Ministry of Social Policy and Youth was renamed to the Ministry for Demography,Family, Youth and Social Policy.

Responsibility of the Project Management and those charged with governance for the financial statemients

The Project Management is responsible for preparation of consolidated financial statements that give a trueand fair view in accordance with financial reporting framework prescribed by the Bank, and for such internalcontrol as they determine is necessary to enable preparation of financial statements that are free frommaterial misstatement, whether due to fraud or error.

In preparing the annual financial statements, the Project Management is responsible for assessing theSubject's ability to continue as going concern in accordance to the Loan Agreement provisions and Projectimplementation deadlines.

Those charged with governance are responsible for overseeing the financial reporting process establishedby the Subject.

Auditor's responsibilities for the audit of annual financial statements

Our audits are required by standards, instructions, guidelines and requirements to be planned and conductedproperly in order to provide reasonable assurances that financial statements are free of any materialmisstatements. Auditing also includes testing of the appropriateness of accounting principles used andprudence of accounting estimates made by the management, as well as evaluating the overall financialstatement presentation. Our audit has included procedures for collecting auditing evidence relevant to theamounts and disclosures presented in the financial statements for the Project. We are confident that theauditing evidence obtained has been sufficient and has provided the appropriate basis for our auditingopinion.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditor's report that includes ouropinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted inaccordance with ISAs will always detect a material misstatement when it exists. Misstatements can arisefrom fraud or error and are considered material if, individually or in the aggregate, they could reasonablybe expected to influence the economic decisions of users taken on the basis of these financial statements.

2

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain profcssionalskepticism throughout the audit. We also:

* identify and assess the risks of material misstatement of the financial statements, whether due to fraudor error, design and perform audit procedures responsive to those risks, and obtain audit evidence thatis sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error, as fraud may involvecollusion, 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 proceduresthat are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the Entity's internal control.

* conclude on the appropriateness of management's use of the going concern basis of accounting and,based on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Entity's ability to to realize the Project. If weconclude that a material uncertainty exists, we are required to draw attention in our auditor's reportto the related disclosures in the financial statements or, if such disclosures are inadequate, to modifyour opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport.

* assess the overall presentation, structure and content of annual financial statements, includingpublications, as well as assessing whether annual financial statements reflect transactions and eventson which they are based in a way that achieves a fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scopeand timing of audit and significant audit findings, including any significant deficiencies in internalcontrol that we identified during our audit.

HLB Inlenjerski biro d.o.o. Rijeka, June 5h, 2017Strossmayerova 1 151 000 RijekaCroatia

On half of HLB Inienjerski biro d.o.o.

Krist a Krividi Ugrin Z nko Star6evikBoard Member Ce ified auditor

Fnienjerski BiroLB Iii ~r o~n 0. 0 o. RSk, Srossayerma 11

3


FINANCIAL STATEMENTS 2016 - THE SOCIAL PROTECTION SYSTEMMODERNIZATION PROJECT (IBRD LOAN 8426HR)

Responsibility for enclosed financial statements

In accordance with the general principles and provisions set in the Contract for Consulting ServicesCONTRACT No. SPSMP-CS-LCS/AUDIT-23 - Financial Statements Audit (herein after: the "Contract")the Loan Manager is responsible for the organization, lawful business practice and managing ofaccounting operations and shall also ensure that all Project financial statements for every financialyear are prepared in accordance with legal and/or contractual provisions.

Also, the Loan Manager is responsible for organisation and good performance of the ProjectImplementation Unit (hereinafter: the PIU") and the financial reporting system used to generateProject's financial statements.

In compliance with the defined financial reporting framework, Project's financial statementscomprise:

a) Statement of Project's Funding Sources and Expendituresb) Statement of Summary Reports- Statement of Expenditures (SoE)c) Statement of Designated Accountd) Corresponding notes on significant policies and other explanations

Project financial statements disclosed on pages 1 to 33 were approved by the Loan Manager onMay 3 0 th, 2017 and signed by:

StaSecretary and Loan ManagerMarin Strmota, PhD

Project financial statements 1


1. INTRODUCTION

In accordance with provisions set in the Loan Agreement 8426-HR of September 25, 2014(hereinafter: the "Loan Agreement"), corresponding Loan Agreement documents and other relevantdocuments including the Contract, the Ministry for Demography, Family, Youth and Social Policy(hereinafter: the "Ministry") is required to publish anual financial statements.

2. GENERAL INFORMATION

2.1. INTRODUCTION

Pursuant to the Loan Agreement, the Government of Croatia received funds from the Intern ationalBank for Reconstruction and Development (hereinafter: the "Bank") toward the cost the SocialProtection System Modernization Project (hereinafter: the "Project"). The aim of the Project, to beimplemented during 2015-2018, is to improve the efficiency and effectiveness of the socialprotection system in Croatia. Also, the goal is to support the Government's reform of socialassistance through five thematic areas:

i. consolidation of social assistance cash benefits administration under One Stop Shop (OSS),ii. unifying and harmonizing the certification of disability,iii. reducing error, fraud and corruption in social protection cash benefits,iv. deinstitutionalization of vulnerable children and adults, andv. activation.

The Project Implementation Unit (hereinafter: the "PIU"), established at the MDFYSP, is tasked withmaintaining Project's financial management system and preparing financial statements inaccordance with regularly applied accounting standards acceptable to the Bank, and in a way thatis appropriate to reflect business operations, funds and expenses related to the Project.

2.2. PROJECT IMPLEMENTATION PROGRESS

The Loan Agreement was signed on September 25, 2014. By December 31, 2014, only activities inrelation to Project's preparation were implemented. The actual Project launch took place in early2015, in conjunction with closing of initially opened Designated Account in USD and opening of newDesignated Account in EUR at CNB.The Project activities continued throughout 2016. Due to MDFYSP's structural and organizationalissues stemming from the parliamentary elections in late 2015 and early parliamentary elections in2016, the intensity of Project activities in 2016 was to some degree reduced than it was initiallyplanned to implement, thus allowing the existing resources of the Project were used and therewere no new withdrawals of funds from the Bank. Also pursuant to Article 2 of the Act onOrganization and Scope of Ministries and Other Central State Administration Bodies (OfficialGazette 93/16), the former Ministry of Social Policy and Youth was renamed to Ministry forDemography, Family, Youth and Social Policy (MDFYSP).



2.3. MAIN PROJECT COMPONENTS

The project will tackle five thematic areas: four will be results areas supported by results-basedfinancing (Component 1) and TA/Investment (Component 2), while one thematic area will becovered by TA/Investment (Component 2) alone, because it is at an early stage of development.

2.3.1. Component 1- Improving Efficiency and Effectiveness of the Social Protection Systern(IBRD Euro 50 million)

This component will use a results-based approach. Payments made under this Component will goto the Ministry of Finance as reimbursement for expenditures made in the Eligible ExpenditureProgram (in this case, the Guaranteed Minimum Benefit). Payments will be triggered byachievement of pre-specified Disbursement Linked Indicators (DLIs) as well as evidence thatsufficient expenditures have been made under the EEP. DLIs have been chosen to support theGovernment's social protection reform in four results areas:

a) consolidation of social assistance cash benefits administration under a one-stop-shop(OSS);

b) unifying and harmonizing the certification of disability;c) reducing error, fraud and corruption in social protection cash benefits;d) deinstitutionalization of vulnerable children and adults.

Results Area A) Consolidation of benefit administration and simplification of proceduresUnder Component 1, the Bank will disburse funds against the eligible expenditure program uponcompletion of the transfer of the administration of each social assistance cash benefit to the OSSover the project period. Each DLI was priced at Euro 5 million, reflecting the difficulty of this reformand its importance for Croatia's Fiscal Consolidation Plan.

Results Area B) Unifying and harmonizing the certification of disabilityUnder Component 1, the Bank will disburse funds against the eligible expenditure program uponcompletion of the legal establishment and then the full operationalization of the CDCI over theproject period. Each DLI was priced at Euro 2 million, reflecting the largely institutional nature ofthe reform.

Results Area C) Reducing error, fraud and corruptionUnder Component 1, the Bank will disburse funds against the eligible expenditure program uponcompletion of the steps taken to implement the EFC Strategy and Action Plan over the Projectperiod. Each DLI was priced at Euro 2 million, reflecting the largely technical nature of the reform,with a Euro 3 million disbursement for the final year DLI at which point the system will be fullystrengthened and best practice, risk-based inspections are being conducted.

Results Area D) De-institutionalization of vulnerable children and adultsUnder Component 1, the Bank will disburse funds against the eligible expenditure program uponachievement of the numerical targets for de-institutionalization set out in the Operational Plan overthe project period. Each DLI was priced at Euro 5 million because these are outcome indicators andpotentially entail high risk.



2.3.2. Component 2 - Investments and Technical Assistance to Support Improvements inEfficiency and Effectiveness of the Social Protection System (IBRD Euro 19,4 million)

This component will use a regular Investment Project Financing (IPF) approach. It would supportinvestments and TA that are necessary, but not sufficient, to support achievement of the DLls in thefour thematic areas supported by results-based financing. It will also support activities in the fifththematic area: activation. Examples of investments and technical assistance needed to supportachievement of the DLls are outlined in summary below:

- One-Stop-Shop: software and hardware upgrades to the Management Information System(MIS) to integrate systems currently used by other cash transfer programs, renovation ofoffices to minimum standards, some consultants and training;

- Central Disibility Certification Institute (CDCI): IT system upgrade supporting CDCIoperations, CDCI headquarters refurbishment, training and technical assistance on disabilitycertification methodology;

- Error-Fraud-Corruption (EFC): MIS software updates, staff training and technical assistanceto develop data matching and risk profiling tools to prevent and detect error fraud andcorruption;

- De-institutionalization: technical assistance and, possibly, goods to improve monitoring andtracking of results, guidelines and minimum standards, support to foster care; and

- Activation: technical assistance in statistical profiling techniques to provide more tailoredservices to the inactive and unemployed and to focus scarce resources.

Project Preparation Advance (PPA) in the amount of EUR 890,000 was approved to accelerate theproject preparation. The PPA was signed by the Government of Croatia in April 2014. Consideringserious budgetary restrictions, the Government is not able to fully finance expertise needed fordetailed operational plans, preparatory activities or initial investments under the Project. Thefinancing of these TA activities, which would otherwise be financed from Component 2 only aftereffectiveness, should help jump start project implementation.

2.3.3. Component 3 - Project Management Support (IBRD Euro 0,6 million)

Project Implementation Unit (PIU) was established at the MDFYSP. The PIU team comprises: ProjectCoordinator/Head of Procurement, Procurement Assistant and two Financial Management staff.The officials that will be members of the PIU were selected. Some of them are civil servants paid bythe MDFYSP and will continue performing their current jobs at the Ministry (Project Coordinatorand Financial Expert), while additional specific experts, such as Procurement and FinancialManagement Officers and a Construction Engineer, who can provide expert advice on renovationsand environmental standards, and support staff will be financed from the project.

Operating expenses for the PIU will be shared between MDFYSP and the Loan. MDFYSP is currentlyfinancing the cost of office space and communications, as well as some staff. The proposed Projectwill support specific costs, including: an annual audit, translation of documents and interpreting atmeetings, an annual workshop to review progress and next steps, and a small contingency allocationfor training/conferences/workshops or other expenses, as the need arises.



2.4. PROJECT FINANCING BY THE IBRD LOAN

2.4.1. General information

The Loan Agreement and other supporting documents prescribe that full cost of the Project will befinanced from the IBRD loan funds.

As the Project is currently still under implementation, the loan payoff has not yet been initiated,whereas the payment condictions are as follows:

- Loan amount 70.000.000,00 EUR- Front-end Fee: 0,25% or 175.000,00 EUR- Interest: payment begins with the first instalement; in annuity of 2.990.715,00 EUR

(instalment 2.191.000,00 EUR), except for the last annuity which would, in case of thewithdrawal of the entire Loan, amount to 2.837.835,00 EUR (instalment of 2.079.000,00EUR).

- Initial payment date: Nov 15, 2018- Ending payment date - end: May 15, 2034- Principal payment dates: On each May 15 and November 15 (beginning November 15, 2018

through November 15, 2033) at 3,13% installment share (2.191.000,00 EUR); on May 15,2034 the remainig amount at 2,97% (2.079.000,00 EUR) installment share

2.4.2. Project financing

The project will be implemented over four years through an IPF IBRD loan in the amount of Euro 70million, with a sizeable results-based component. At first, a Program for Results (PforR) instrumentwas proposed, but the Ministry identified sizeable investment and TA needs for preparation as wellas during implementation. The Euro 20 million requested for TA/investment exceeded the 25percent available as advances under the PforR instrument and the Government was not able to pre-finance them. A PPA has been requested to finance some of these preparation activities.Furthermore, the proposed project extends into several different areas involving four Ministries andfive agencies, covering some (but not all) cash benefits and some (but not all) services. As such, theProgram (for PforR purposes) became harder to define.

For Component 1, disbursements will reimburse Government expenditures on a defined eligibleexpenditure line item (the "Eligible Expenditure Program" or EEP). The EEP has been defined as theGMB program for social assistance to low-income families. Component 1 will reimburse the CroatianTreasury for a share of monthly GMB expenses already incurred (the amount being determined bythe price attached to the DLIs that have been achieved). As in any results-based loan, the WorldBank would disburse against verification of Government expenditures (and upon verification of theDLIs, as discussed below). As such, the loan proceeds under this Component 1 will be part of theregular state budget financing, with the World Bank as one of the sources of overall funds, spentconsistent with the state budget policies and procedures. To enable the World Bank team tomonitor progress in releasing resources for this program, the MDFYSP will submit Semi-AnnualReports on the execution of the State Budget regarding the GMB expenditures. The financialreporting system of the State Treasury and MDFYSP will regularly track and report on budgetestimates and actual expenditures for the GMB benefits. This monitoring will enable the Project to



rely on the national fiduciary system for project financial management and disbursement, asdiscussed below.

Disbursements of funds for Component 1 will be triggered by achievement of agreed specific results:Disbursement-Linked Indicators or DLIs, and supported by evidence of expenditures incurred underthe EEP. A series of inputs, outputs and outcomes contribute to the achievement of the ProjectDevelopment Indicators and ultimately the PDO. Fourteen of the critical outputs and outcomes havebeen selected as DLIs. Achievement of the results will be supported by actions by the Governmentand other stakeholders, as well as the TA and investments under Component 2.

Each DLI achievement will be monitored, measured and verified according to specific protocolselaborated in the Project Operational Manual. The Task Team Leader must certify achievement of aDLI and verification that sufficient eligible expenditures have been incurred before the associatedloan amount is released. The disbursement projections are indicative; disbursements will be madeupon verified achievement of the specified DLI and eligible expenditure at any time during theimplementation period.

Disbursement of funds for Components 2 and 3 will follow standard investment project financingarrangements. A Procurement Plan for the first eighteen months (and beyond, where possible) hasbeen prepared that details the inputs to be financed under the project.

2.5. LOAN APPLICATION

2.5.1. General remarks

Loan application is planned in accordance with defined project components:

- Under Component 1, the proposed project will represent a small share of the Government'sGMB spending, while under Components 2 and 3 the proposed project will represent 100percent of the project costs.

- Under Component 1, the MOF would be the recipient of the loan funds disbursed based onachieved results.

- Under Component 2, the project will finance TA and investments needed to supportachievement of the DLIs under Component 1 as well as activities in Activation.

- Under Component 3, the project will finance PIU which has been established in the M DFYSP.

2.5.2. Project Preparation Advance (PPA) - the PPA Phase 2014 (ending on December 23, 2014)

Following the Loan Agreement signing, the Project Preparation Advance (PPA) phase was initiated,having 200,000.00 USD planned and withdrawn toward the initial expenditures. As the actualProject implementation was approaching, the PPA phase was soon closed whereas the remainingfunds were returned and DA in USD was closed.



2.5.3. Loan Phase - application from January 1, 2015

Loan phase, or the Project implementation, began in 2015 when the first activities were undertakenin line with the Project implementation plan. The condition for using the Loan was the payment ofthe Front-end fee from budgetary sources in the amount of 175,000.00 EUR.



3. REPORTING AND ACCOUNTING FRAMEWORK

3.1. REPORTING FRAMEWORK

The reporting framework for Project's financial statements is prescribed in item 15. FINANCIALMONITORING REPORTS FOR WORLD BANK-FINANCED PROJECTS: GUIDELINES FOR BORROWERS . Itallows reporting based either on the cash basis or the accrual basis.

Additional reporting details in line with the cash basis are prescribed by the International PublicSector Accounting Standards (IPSAS "Financial Reporting Under the Cash Basis of Accounting").These standards prescribe the reporting framework based on the cash basis of accounting

The Contract for financial statements audit (CONTRACT No. SPSMP-CS-LCS/AUDIT-23), Annex 'A'prescribing Terms of Reference and Scope of Services, indicates the content of the Project'sfinancial statements, for Project's reporting purposes:

a) Statement of funds received from and if applicable other financial sources, all presentedseparately

b) Statement of Expenditures shown under the main project headings and by main categoriesof expenditures, both for the current fiscal year and accumulated to-date, includingexplanations under notes, as required

c) c) Statement of Summary Reports used as the basis for withdrawal applications,d) Statement of Designated Account, including all changes and reconciliations of movements

on the Designated Accounte) Balance Sheet showing Accumulated Funds of the Project, bank balances, other assets of the

Project, and liabilities, if any. Statement of fund balancies (C-4)f) Statement of planned and achieved Project status

3.2. ACCOUNTING FRAMEWORK

Reporting framework of Project's financial statements is based on cash basis of accounting.

For matters of conviniency, the Statement of funding sources and the Statement of paidExpenditures are merged and presented as the Statement of Project sources and expenditures.Since reporting framework is based on cash basis of accounting, neither Project commitments notProject Balance sheet are disclosed as separate reports as all data on invested assets was disclosedin the Statement of Project sources and expenditures. In relation to total planned, results achievedare displayed in separate columns under primary tables.

In accordance with the above, the financial statements comprise:a) Statement of Project sources and expendituresb) Statement of expenditures (SoE)c) Statement of Designated Account



4. BASIC DEFINITIONS AND CONVENTIONS

4.1. DEFINITIONS

Hereinafter, the abbreviation "IBRD" will be used to designate the World Bank, or its full title theInternational Bank for Reconstruction and Development.

"Project" will be used to designate the Social Protection System Modernization Project.

Expressions such as "Entity", "Organisation", "Ministry", "MDFYSP" in these financial reportsdesignate the Project implementing body, the Ministry for Demography, Family, Youth and SocialPolicy.

The abbreviation "DA" refers to Designated Account.

4.2. CONVENTIONS

All amounts will be expressed in EUR (as per the Loan Agreement) or in kunas (HRK) or in anothermonetary unit, where this report so requires (USD for 2014). The amounts will not be rounded up;rather they will be presented in their full amount including fractions of the basic monetary unit -cents for EUR, lipas for HRK and US cents for USD. Monetary units presented in such manner willbe designated by their international three letters simbol as EUR, HRK, USD or internationalsimbols C, kn, $. Other currency units will be designated by corresponding international currencycode.

If any amount should be displayed differently than previous one, this will be expressly noted in thetext.



5. STATEMENT OF FUNDING SOURCES AND EXPENDITURES, INDICATING IBRDSOURCES AND AGGREGATE EXPENDITURES BY MAJOR CATEGORIES FORPRECEDING PERIOD, CURRENT PERIOD AND AGGREGATE EXPENDITURES ONREPORTING DATE

5.1. INTRODUCTION

Statement of Project sources indicates the IBRD sources. Since neither the Loan Agreementforesees other funding sources nor such funding sources were used in Project implementation, thisreport omits columns indicating such sources in order to give clearer presentation.

Statement of Project expenditures indicates incurred expenditures, by their basic categories.

In order to achieve user-friendly report and logical/accounting correlation, these two reports aredisclosed integrally, as indicated below including the relation to Designated Account since reportingframework is based on cash basis of accounting.



5.2. STATEMENT ON PROJECT SOURCES AND EXPENDITURES

'2015. I Correcti '2015not corrected on correced 2016. Total

DESCRIPTION Notes Total planned achivedPrevious year current year Total in %

Opening balance

IBRD Designated Account - EUR 7.1.2/7.2.1 0,00 C 886.450,90 C

Funding sources

IBRD funds 1.883.007,13 C 1.883.581,90 C 4.000.000,00 C 5.883.581,90 C 70.000.000,00 C 8,41%

Direct payments 263,10 C 263,10 C 0,00 C 263,10 C

Designated Account withdrawals 5.3.1. 1.882.744,03 C 574,17 1.883.318,20 C 0,00 C 1.883.318,20 C

Withdrawals for Ministry of Finance -- component 1 5.3.1./6.1 0,00 4 4.000.000,00 C 4.000.000,00 C

Reconciliation for Loan P4690 0,60 0,60 C 0,60 C

Local funds 0,00 C 0,00 C 0,00 C

Direct payments 0,00 f 0,00 C 0,00 C

Sources total 1.883.007,13 C 574,77 1.883.581,90 C 4.000.000,00 C 5.883.581,90 C 70.000.000,00 C 8,41%

Funding per categories/components

1 Payments under EEP, Component 1 0,00 C 4.000.000,00 E 4.000.000,00 E 50.000.000,00 C 8,00%Goods, works, non-consulting services, consulting

2 services (including Audit), training and operational 5.4.2.,7.3.2.1 997.145,57 C -14,57 997.131,00 E 726.377,98 f 1.723.508,98 f 19.050.000,00 E 9,05%costs for Components 2 and 3

3 Preparation Advance refund (*2015 loan refund) - 263,10 f -263,10 0,00 C 0,00 C 0,00 E 950.000,00 E 0,03%

Project expenditures total 997.408,67 C -277,67 997.131,00 C 4.726.377,98 C 5.723.508,98 C 70.000.000,00 C 8,18%

Closing balanceIBRD Designated Account 7.2.1. 886.450,90 C 160.072,92 C 160.072,92 C



5.3. IBRD LOAN 8426HR BALANCE

5.3.1. Breakdown of changes throughout 2016

DESCRIPTION Note Date Withdrawal from Loan Type of payment fromAccount Loan Acco unt

Loan balance, beginning of 2016 1.883.581,90 C

DA Withdrawal (Appl.no.) 0,00 C

DLI Withdrawal 6.1. 23.5.2016 4.000.000,00 C DLI Withdrawal

Direct payment 0,00 C

Total increase for 2016 4.000.000,00 C

OTAL (Cumulative at the end of 2016) 5.883.581,90 C

Loan balance on 31.12.2016 is EUR 5,883,581.90.



5.4. DETAILED BREAKDOWN OF PROJECT EXPENDITURES DURING 2016 AND AGGREGATED ONDECEMBER 31, 2016

5.4.1. Expenditures, by Project categories

CorrecidAggregate Correction

until of previous aggregateProject expenditures by categories December 31, reporting until Current year Total

2016 period December 31,2016

Works: 0,00 C 0,00 C 0,00 C

0,00 C

Delivery of goods: 357.961,06 C 0,00 C 357.961,06 C 360.878,48 C 718.839,54 C

Office equipment and furniture 357.961,06 C 357.961,06 C 360.878,48 C 718.839,54 C

0,00 CNon consulting services: 0,00 C 0,00 C 0,00 C 0,00 C

0,00 CConsulting services: 534.242,12 C 0,04 C 534.242,16 C 359.584,02 C 893.826,18 C

Intellectual and personal services 534.242,12 C 0,04 C 534.242,16 C 359.584,02 C 893.826,18 C

0,00 CTraining and operational costs: 105.202,43 C -274,65 C 104.927,78 C 5.915,48 C 110.843,26 C

Staff training 27.401,93 C -1,77 C 27.400,16 C 0,00 C 27.400,16 C

Study tours 64.699,73 C -9,77 C 64.689,96 C 2.235,76 C 66.925,72 C

Office supplies and other material 1.507,16 C 1.507,16 C 270,38 C 1.777,54 Cexpenses

Telephone, mail and transportation 4.624,05 C -0,01 C 4.624,04 C 1.421,53 C 6.045,57 Cexpenses

Promotion and information services 2.796,36 C 2.796,36 C 1.987,81 C 4.784,17 C

Other services 3.072,23 C 3.072,23 C 0,00 C 3.072,23 C

Banking services and payment services 1.100,97 C -263,10 C 837,87 C 0,00 C 837,87 C

*Round up 3,06 C -3,06 C 0,00 C

Total project expenditures 997.408,67 C -277,67 C 997.131,00 C 726.377,98 C 1.723.508,98 C



5.4.2. Project expenditures, by Project components

Correction of Achive

Components/Activities Aggregate, by previous 2016. Total planned dcurrent year reporting

period 2015 Current year Totak

Component 1:

Improving efficiency and effectiveness of the social 0,00 4 0,00 C 4.000.000,00 4.000.000,00 50.000.000,00 800%protection system (IBRD Eur 50 million) C C CComponent 2:

Investment and Technical Assistance to supportimporovements in efficiency and effectiveness of 1.509.408,74 19.400.000,00the social protection system (IBRD Eur 19.4 million) 890.924,37 C 751,62 C 891.675,99 C 617.732,75 C f C 7,78%Thematic Area 1: OSS (Unified Transaction Center - 12.000.000,00OSS) 575.693,95 f 486,68 576.180,63 C 52.502,17 C 628.682,80 C 4Thematic Area 2: CDC1 (Central DisabilityCertification Institute) 189.570,30 f 160,26 189.730,56 C 69.992,81 C 259.723,37 E 4.000.000,00 E

Thematic Area 3: EFC (Error, Fraud and Corruption)Thematic_Are_3:_E_C_(Errr,_Fraud_andCorruption) 29.575,37 f 23,38 29.598,75 C 305.758,59 C 335.357,34 E 2.250.000,00 C

Thematic Area 4: Deinstitucionalization89.544,13 C 75,78 89.619,91 C 141.118,70 C 230.738,61 C 750.000,00 C

Thematic Area 5: Activation6.540,62 C 5,52 6.546,14 C 48.360,48 C 54.906,62 C 400.000,00 C

Comnponent 3:Component_ _ 3: 106.484,30 C -1.029,29 f 105.455,01 C 108.645,23 C 214.100,24 f 600.000,00 f 35,68%

Project managementProject management 74.583,24 C -1.048,72 73.534,52 C 106.657,42 C 180.191,94 ,

Other (including study tour, training, conference)__________________________________31.901,06 4 19,43 ( 31.920,50 f 1.987,81 C 33.908,3 1 C

Total Expenditure 5.723.508,98 70.000.000,00997.408,67 C -277,67 C 997.131,00 C 726.377,98 C C C 8,18%



6. STATEMENT OF EXPENDITURES (SoE) - SUPPORTING DOCUMENTATION

6.1. INTRODUCTION

In line with the Loan Agreement provisions, and additional provisions set in Disbursement Letter,namely sections Additional instructions, Disbursement, Item ///.Reporting on Use of Loan Proceeds,additional supporting documentation should be enclosed to withdrawal application, namely for paideligible expenditures relating to:

- works of contractual value equivalent to or exceeding the amount of USD 500,000;- equipment of contractual value equivalent to or exceeding the amount of USD 100,000;- consulting services of contractual value equivalent to or exceeding USD 100.000 as well as- individual consultants' services of contractual value equivalent to or exceeding USD 50.000.

Any other payments are subject of the Statement of Expenses (SoE) form.

In 2016, there were no SoE based withdrawal applications. The only withdrawal application wasachieved for component 1. This procedure is under direct supervision by the IBRD, by means ofinspection of achieved DLIs and direct transfer of allocated funds to Ministry of Finance (and not toDesignated Account).

ITEM DESCRIPTION AMOUNTDLI Withdrawal application, for Ministry of Finance May 23, 2016 4.000.000,00 EUR

TOTAL 4.000.000,00 EUR



6.1.1. Statement of expenditures - SoE for withdrawals in 2016, by suppliers

6.1.2.1 Withdrawal - SoE number

1 2 3 4 5 6 7 8 9 11

Type I Currency and CurrencyWB Contract I Total Amount and amountGoods or Currency and I % Financed EligIble

Nubr siof invoice, as frm epnitr aeignd R Ecae PamenSupplier Service / Total Amount of fiefrom expenditure (5 pa rom Excange Payment Notesspecified in Client Brief Contractin Designated Rate dateBreIonrc BRD/lDA/TF x 6i)Connection .withdrawal Account (ifDescription.

application Applicable)

N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A

TOTAL N/A N/A



6.1.2. Payments to Designated Account based on withdrawal application and auditor's obligationto examine these payments

Following point 6.1.2.1, in 2016 there were no withdrawals on Designated Account based on SoE.Payments of eligible expenditures were made during 2016, but as stated in point 7.3.2.3., due tosmall amount of Project expenditures incurred and sufficient funds in the Operations Account, therewere no additional requests for withdrawals to Designated Account.

7. STATEMENT OF PROJECT DESIGNATED ACCOUNT IN 2016

7.1. BACKGROUND OF DESIGNATED ACCOUNTS

In order to meet Project funding requirements, the Ministry opened in 2014 Designated Account inUSD at Raiffeisen Bank, for Project Preparation Phase (PPA). By the end of 2014, in agreement withthe IBRD, the Ministry initiated the closing of Designated Account in USD (closed at the beginningof 2015). In 2015, the Ministry initiated the opening of new Designated Account in EUR, at CroatianNational Bank (CNB).

7.1.1. Designated Account at RBA d.d. in 2014 - the PPA phase

Account No. 2484008-1300164451IBAN: HRO2 2484 0081300164451

Account currency USD

Depositary bank Raiffeisen bank d.d.

Address Petrinjska 59, Zagreb, Croatia

Related Loan Advance Agreement for Preparation of Proposed Social ProtectionSystem Modernization Project No. IBRD P4690-HR, dated April 24, 2014

Loan amount 1.240.000 USD

In 2014, Designated Account in USD was opened at Raiffeisen Bank, for PPA phase, and was closedon February 2, 2015; the remaining balance was converted to EUR and transferred back to the IBRD.



7.1.2. Designated Account at CNB

Account No. HR1210010051510000185

Account currency EUR

Depositary bank Croatian National Bank

Address Trg hrvatskih velikana 1, Zagreb, Croatia

Related Loan IBRD Loan No. 8426HR, dated September 25, 2014

Celing 1.000.000 EUR

Loan amount 70.000.000 EUR

After the closing of Designated Account at RBA d.d., a new Designated Account in EUR was opened,in line with the Disbursement Letter provisions for the Loan purposes; its basic features are listedabove.

In agreement with the IBRD and in line with specific Treasury requirements, i.e. the Ministry ofFinance, Designated Account in EUR operates in a way that funds withdrawn to this account aretransferred within 5 days to account at the Treasury which is assigned to the MDFYSP and openedspecially for this purpose; funds are converted at the middle exchange rate established on the dayof receipt of funds from the IBRD account to Designated Account in EUR.

7.1.3. Operations Account at the Treasury, through which Designated Account at CNB operates

Account No. 1510000185

Account currency HRK

Depositary bank Ministry of Finance, State Treasury

Address Katan6iteva 5, Zagreb, Croatia

Related loan IBRD Loan No. 8426HR, dated September 25, 2014

Account at the Treasury is essentially the operational part of Designated Account at the CNB. Inthis way the account at the CNB functions as "in-between account" in EUR, because the fundswithdrawn from the IBRD in EUR are transferred and converted to HRK at the Treasury account. Thisaccount in HRK operates as the payment account for Designated Account.



7.2. STATEMENT OF PROJECT DESIGNATED ACCOUNT

7.2.1. Statement of Designated Account in EUR, at CNB (NOT INCLUDING TRANSFERS TO THEOPERATIONS ACCOUNT IN HRK CURRENCY), I.E. BALANCE OF THE OPERATIONS ACCOUNT,CONVERTED TO LOAN CURRENCY*

No DESCRIPTION Note In Loan currency

1 Opening balance, on Jan. 01, 2016 886.450,90 C

2 Increase/Decrease-cumulated unexpected differences 0,00 C 0,00 C

3 1BRD payments during reporting period 0,00 C 0,00 C

4 Sum row 2 and 3 0,00 C 0,00 C5 Remaining amount 886.450,90 C

6 Closing balance, on Dec 31, 2016* 160.072,92 C

7 Increase/Decrease-cumulated unexpected differences 0,00 C

8 Current reporting period expenditures 7.3.2.1 726.377,98 C

9 Sum row 7 and 8 726.377,98 C

10 Sum row 6 and 9 886.450,90 C

11 Difference (if any) (row 5 subtract row 10) 0,00 C

Note:

* - As indicated earlier, the balance reported in Loan currency (EUR) is always zero (0) because the funds are transferredimmediately after withdrawal to the Operations account at the Treasury. This Designated Account balance reportsimulates account balance in a scenario where the funds are not being transferred to the Operations account, i.e.itreports balance of the Operations account (see section 7.2.2.) in EUR currency at exchange rate maintained by FIFOmethod ("First In-First Out"); exchange rate is set according to the CNB middle exchange rate on the day of transfer offunds from the IBRD account to the Designated Account.

As explained in the note, the actual Designated Account balance on December 31, 2016 is 0 (zero) EUR.



7.2.2. Statement of the Operations account, at the Treasury, in HRK currency

No DESCRIPTION Note In HRK

1 Opening balance, on Jan. 01,2016 6.751.953,69 kn

Increase/Decrease - cumulated unforeseendifferences

3 IBRD payments during reporting period 0,00 kn

4 Sum row 2 and 3 0,00 kn

5 Remaining amount 6.751.953,69 kn

6 Closing balance, on Dec 31, 2016 1.219.205,11 kn

Increase/Decrease - cumulated unforeseendifferences

8 Expenditures in current reporting period 7.3.2.1. 5.532.748,58 kn

9 Sum row 7 and 8 5.532.748,58

10 Sum row 6 and 9 6.751.953,58 kn

11 Difference (if any) (row 5 subtract row 10) 0,00 kn

7.2.3. Balance Sheet

December 31, 2016 Designated Account balance, in EUR as the Loan currency, totals zero (0) EUR;changes occurring during 2016 are clarified in detail in subsequent paragraphs. The actual balanceof the Operations account in HRK currency at the Treasury, on the reporting date, totals1.219.205,11 HRK.

7.2.4. Interests

Since the actual funds are stockpiled in the Operations account at the Treasury, and not inDesignated Account at CNB, and since such actual funds make part of aggregate Treasury funds, itis not possible to determine the Designated Account interests.

7.2.5. Applied exchange rate and rate differences

In order to acknowledge special features of Designated Account at CNB as a "in-between account"and the Operations Account at the Treasury (in HRK currency), the FIFO method (First In - First Out)was selected to monitor conversion rates. This suggests that all payments from the OperationsAccount in HRK are calculated at conversion rate set on the date of transfer of funds in EUR currencyfrom Designated Account to the Operations Account in HRK currency at the Treasury. This rate isapplied until all funds converted at this rate are depleted; after that, a new rate applies to remainingbalance which was generated following new transfers from Designated Account to the OperationsAccount at the Treasury.



Such practice eliminates the possibility of exchange rate differences which may be generated usingfunds from the Operations Account in HRK.

Applied exchange rates and payments at such rates in 2016 are as follows:

Amount inDate of Heceived Applied HRK, for

Amount transfer to amount in exchange payments at(EUR) Operations Treasury, in rate applied

account HRK (5/3) exchangerate

1 2 3 4 5 6 7

Difference,because of

14.04.2015. 1.000.000,00 23.04.2015. 7.576.750,00 7,576750 27.258,47 wrongexchange

rate applied1 _745,67 HRK

2 17.11.2015. 882.744,03 27.11.2015. 6.723.949,55 7,617100 6.723.949,55

**3 23.05.2016. 4.000.000,00 23.05.2016. N/A N/A N/A

Remainingamount for

- payments InApplied Used in HRK on

exchange current 31.12.2016,rate period at applied

exchangerate,

1 Used, at applied exchanged rate 7,576750 27.258,47 0,00

2 Used, at applied exchanged rate 7,617100 5.505.490,00 1.219.205,11

Note:* The 2015 report did not include difference in 745,67 HRK (28.004,14 HRK - 27.258,47 HRK), generated due to application of wrongexchange rate. Items marked (+) in table 7.3.2.1** Payment of EUR 4.000.000,00 refers to Component 1 and is instantly allocated to the Ministry of Finance, does not go throughProject Designated Account and therefore withdrawals and payments related to Component 1 do not affect the currency exchangerate applied for Components 2 and 3.



7.3. DETAILED OVERVIEW

The following represents an overview of individual withdrawals to and payments from ProjectDesignated Account.

7.3.1. Specific withdrawals to Designated Account, in 2016

Withdrawal from Type of paymentDESCRIPTION DateLoan Account, in EUR from Loan Account

Withdrawal (DA) *N/A *N/A *N/ATOTAL _ I I

Note: * During 2016, no withdrawals were achieved to Project Designated Account, in view of the fact thatwithdrawals under Component 1 are not made through Designated Account but are directly paid to theMinistry of Finance.

7.3.2. Individual payments from the Operations Account in 2016, including types of contracts andpaid expenditures

7.3.2.1 Payments from the Operations Account at the Treasury in 2016, converted to Loancurrency (EUR)

Currency and PaymentsfromTotal, as Exchange Designated

Supplier specified in Payment Date RteComponent Refcontractinvolce.No.withdrawal Rate cunt,ninapplication Loan currency

PPA/SPSMP-CS-lC/FMA-(+) Mate] I9tuk 11.298,75 kn 18.1.2016 7,57675000 1.491,24 EUR P/U P

PPA/SPSMP-CS-lC/PA-(+)Neda eulo 10.701,38 kn 18.1.2016 7,57675000 1.412,40 EUR P/u 08/1

(+)Ana Beneik *5.258,34 kn 18.1.2016 7,57675000 *694,01 EUR P/USPSMP-CS-IC/TRA-10

Ana Ben6ik 5.670,74 kn 18.1.2016 7,61710200 744,47 EUR PlU

Gorjan eemanovie 10.929,08 kn 18.1.2016 7,61710200 1.434,81 EUR P/u SPSMP-CS-IC/TECHA-09

Sanjica Frei Harper 23.317,25 kn 18.1.2016 7,61710200 3.061,17 EUR DE PPA/SPSMPCS1CFCA05 - Amand.1

Tomisla, obrtza 20.715,01 kn 20.1.2016 7,61710200 2.719,54 EUR DEposlovne usluge Invoice 6-1-1

Tomisla, obrtza 170,38 kn 20.1.2016 7,61710200 22,37 EUR DEposlovne uslugeMendel. obrtza

savjetovanje i 20.715,01 kn 20.1.2016 7,61710200 2.719,54 EUR DEprevodenje

Invoice 7-1-1Mendeg. obrt za

savjetovanje i 176,00 kn 20.1.2016 7,61710200 23,11 EUR DEprevodenje

PPA/SPSMP-CS-lC/FMA-Mate] ltuk 11.298,75 kn 25.2.2016 7,61710200 1.483,34 EUR P/u 07/1



Current V and PyinsfoCijrt'w andPayments fronmTotal, as

Exchange DesignatedSupplier specified in Payment Date Rate Accoun, in Component Ref.controct/linvoir.No.

withdrawalRate Accoun,t, inWithdrawal

application Loan currency

Neda eulo 10,701,38 kn 25.2.2016 7,61710200 1.404,91 EUR P/U E 8/1 _

Ana Ben6ik 10.929,08 kn 25.2.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-ICITRA-10

Gorjan eemanovie 10.929,08 kn 25.2.2016 7,61710200 1.434,81 EUR P/U SPSMP-g1C TECHA-09

PPA1SPSMP-S-IC FCA-Sanjlco Frei Harper 23.317,25 kn 25.2.2016 7,61710200 3.061,17 EUR DE05 - Amoand.1

Toislav, obrt za 20.715,01 kn 26.2.2016 7,61710200 2.719,54 EUR DE Invoice 1-1-1poslovne usluge_______

Tomislv obrt za 201,85 kn 26.2.2016 7,61710200 26,50 EUR DE_poslo0vne usluge

Mende§. obrt zasavjetovanje i 20.715,01 kn 26.2.2016 7,61710200 2.719,54 EUR DE Invoice 1-1-1prevodenje

Mende§. obrt zasavjetovanje i 240,00 kn 26.2.2016 7,61710200 31,51 EUR DEprevodenje

Bronka Novosel 22.163,14 kn 26.2.2016 7,61710200 2.909,66 EUR DE Invoice 23-360-1

Branka Novosel 22.163,14 kn 26.2.2016 7,61710200 2.909,66 EUR DE Invoice 02-360-1

Marko Lucie 25.486,56 kn 26.2.2016 7,61710200 3.345,97 EUR A Invoice.4a1

Marko Lucie 10.080,00 kn 26.2.2016 7,61710200 1.323,34 EUR A Invoice 5/1 1

Goran Boievie 15.400,00kn 26.2.2016 7,61710200 2.021,77 EUR P/U Invoice 1212015

Goran Bolieevie 15.400,00 kn 26.2.2016 7,61710200 2.021,77 EUR P/U Invoice 1,2016

Narodne novine d.d. 7.011,78 kn 26.2.2016 7,61710200 920,53 EUR OC Invoice 820185006780


Gordano Bu1jan 32.267,00 kn 1.3.2016 7,61710200 4.236,13 EUR CDC1 Invoice: 1-2015Flander

Dinko kegro 21.082,00 kn 1.3.2016 7,61710200 2.767,72 EUR CDC1 Invoice 2015

Ana Wagner Jakob 18.702,00 kn 1.3.2016 7,61710200 2.455,26 EUR CDCl Invoice 1-2015

Robert geparovie 41.237,50 kn 1.3.2016 7,61710200 5.413,80 EUR CDCl Invoice 16/1/1

PPA/SPSMP-CS-lC/FMA-MateJ I§tuk 11.298,76 kn 14.3.2016 7,61710200 1.483,34 EUR P/U 07/1

PPA/SPSMP-CS-l C/PA-Neda eulo 10.701,38 kn 14.3.2016 7,61710200 1.404,91 EUR P/U 08/

Ana Beneik 10.929,08 kn 14.3.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-IC/TRA-10

Gorjan eemanovie 10.929,08 kn 14.3.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-IC/TECHA-09

Comping d.o.o. 2.328.993,75 kn 22.3.2016 7,61710200 305.758,51 EUR EFC Invoice :1702-01-1

Marko Lucie 6.720,00 kn 1.4.2016 7,61710200 882,23 EUR A Invoice 1/1/1

Mendel. obrt zosavetovanje i 20.715,01 kn 1.4.2016 7,61710200 2.719,54 EUR DE Invoice 2-1-1prevodenje

Mendel. obrtzasavjetovanje i 243,00 kn 1.4.2016 7,61710200 31,90 EUR DE

prevodenje

Goran Bolieevi6 15.400,00kn 1.4.2016 7,61710200 2.021,77 EUR P/U Invoice 2/2016



Currency and Payments fromTotal, as Exchange Designated

Supplier pecified in Payment Date RateComponent Ref.contrcnvoke.Nowithdrawalapplication Loan currency

PPA~LSPSMP-CS-/C FC-Sanica Frei Harper 23.317,24 kn 4.4.2016 7,61710200 3,061,17 EUR DE 05 -Amand!1

LukaFresi 19.166,66kn 24.3.2016 7,61710200 2.516,27EUR OSS____ _ __ ___ _ __ _ _ ____ ___14

SPSMP-CS-1C/SS-IESLuka Fresi 19.166,66 kn 4.4.2016 7,61710200 2.516,27EUR OSS ZO

14Tom/slov, obrtza 20.715,01 kn 1.4.2016 7,61710200 2.719,54 EUR DE Invoice 2-1-1Toslovne us/lge -Tom/slav, obrt za 277,86 kn 1.4.2016 7,61710200 36,48 EUR DEposlovne usluge

PPA/SPSMP-CS-/C/FM-Mate] Ituk 11.298,76 kn 12.4.2016 7,61710200 1.483,34 EUR P/U 07/ F

Neda eulo 10.701,38 kn 12.4.2016 7,61710200 1.404,91 EUR P/U PPAISPSMP-CS-VPA-


Gorjan eemanovie 10.929,08 kn 12.4.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-ICITECHA-09

Tomislav, obrtzaposlovne us/age 20.715,01 kn 15.4.2016 7,61710200 2.719,54 EUR DE Invoice: 3-1-1

Tomislav, obrtzapoisove usa 274,00 kn 15.4.2016 7,61710200 35,97 EUR DEposlovne usluge

Goran Boifevie 15.400,00 kn 15.4.2016 7,61710200 2.021,77 EUR P/U Ino i 2016

Mende§. obrt zosavjetovanje i 20.715,01 kn 15.4.2016 7,61710200 2.719,54 EUR DE Invoice 3-1-1prevodenje

Mendel. obrt zasavjetovanje i 300,00 kn 15.4.2016 7,61710200 39,39 EUR DE

prevodenje


Boris Nemeth 13.388,05 kn 20.4.2016 7,61710200 1.757,63 EUR OSS Invoice 01-1-1

SPSMP-CS-lC/OSS-E/ES-Luka Fresl 19.166,66 kn 28.4.2016 7,61710200 2.516,27 EUR OSS 14

14PPA/SPSMP-CS-IC/FCA-

Sanjico Frei Harper 23.317,24 kn 28.4.2016 7,61710200 3.061,17 EUR DE 0PAISPS05 -Amond,.1

PPA/SPSMP-CS-lC/FMA-MateJ ltuk 11.298,75 kn 10.5.2016 7,61710200 1.483,34 EUR P/U 07/1

PPA/SPSMP-CS-lC/PA-Neda iffulo 10.701,38 kn 10.5.2016 7,61710200 1.404,91 EUR P/U 08/1



PPA/SPSMP-CS-IC/FCA-Sanjica Frei Harper 23.317,25 kn 10.5.2016 7,61710200 3.061,17 EUR DE -SaC/CA

05 -Amond. 1

Luka Fres/ 13.416,66 kn 10.5.2016 7,61710200 1.761,39 EUR OSS SPSMP-CS-1C10SS-E1ES14

mob.tel: 7/2015 -Sanjica Frei Harper 2.617,24 kn 18.5.2016 7,61710200 343,60 EUR DE 1201

Mendeg. obrt zasavjetovanje i 20.715,01 kn 23.5.2016 7,61710200 2.719,54 EUR DE Invoice 4-1-1prevodenje


prevodenje



Currency and Payments fromTotal, as

Supplier specified in Payment Date Exchange Designated Component Ref.contract/Invoce.No.withdrawal Rate Account, In

application Loan currency

Iom/slav, obrtza 20.715,01 kn 23.5.2016 7,61710200 2.719,54 EUR OE Invoice 4-1-1Toi slugertzTorisla, obrt za 274,00 kn 23.5.2016 7,61710200 35,97 EUR DEposlovne usluge

Goran BolieviW 15.400,00 kn 23.5.2016 7,61710200 2.021,77 EUR P/U Invoice4/2016


Boris Nemeth 36.898,11 kn 23.5.2016 7,61710200 4.844,11 EUR OSS Invoice 02-1-1

Comping d.o.o. 419.853,75 kn 1.6.2016 7,61710200 55.119,88 EUR CDC1 Invoice 415-01-1

FIVd.o.o. 2.059,53 kn 1.6.2016 7,61710200 270,38 EUR P/U Invoice R1

1543VOO02 10001

Ratko Mutavdlie 15.514,19 kn 1.6.2016 7,61710200 2.036,76 EUR OSS Invoice 10/2015

Ratko Mutavdie 17.730,50 kn 1.6.2016 7,61710200 2.327,72 EUR OSS Invoice 11/2015


Luka Fresi 19.166,66 kn 25.5.2016 7,61710200 2.516,27 EUR OSS SPSMP-CS-IC/S-FIFS-14

Matej I§tuk 11.298,76 kn 10.6.2016 7,61710200 1.483,34 EUR P/U PPA/SPSMP-CS-IQ/MA-

PPA SPSAMP-CS-ICJPA-Nedo eulo 10.701,38 kn 10.6.2016 7,61710200 1.404,91 EUR P/U 08/1

Ana Ben6ik 10.929,08 kn 10.6.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-ICITRA-10


Mendel. obrt zasavjetovanje / 20.715,01 kn 10.6.2016 7,61710200 2,719,54 EUR DE Invoice 5-1-1

prevodenjeMendel. obrtzasavietovanje i 300,00 kn 10.6.2016 7,61710200 39,39 EUR DE

prevodenjeTorislav, obrtzo 20.715,01 kn 10.6.2016 7,61710200 2.719,54 EUR DE Invoice 5-1-1poslovne uslugeTorislov, obrtzo 274,00 kn 10.6.2016 7,61710200 35,97 EUR DEposlovne usluge

Marko Lucie 10.080,00 kn 17.6.2016 7,61710200 1.323,34 EUR RA Invoice 2/1/1

Marko Lucie 9.120,00 kn 17.6.2016 7,61710200 1.197,31 EUR A Invoice 3/1/1

Goran Boifevie 15.400,00kn 16.6.2016 7,61710200 2.021,77 EUR P/U Invoice 5/2016

Luka Fres/ 15.333,34 kn 23.6.2016 7,61710200 2.013,01 EUR OSS SPSMPCSIOSSFIFS14


PPA/SPSMP-CS-lC/PA-Neda Culo 10.701,38 kn 13.7.2016 7,61710200 1.404,91 EUR P/U

PPA/SPSMP-CS-lC/FMA-Matej ltuk 11.298,75 kn 13.7.2016 7,61710200 1.483,34 EUR PILU 07/


Ana Ben6ik 10.929,08 kn 13.7.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-IC/TRA-10

PPA/SPSMP-CS-lC/FCA-Sanjica Frei Harper 23.317,25 kn 13.7.2016 7,61710200 3.061,17 EUR DE 05 -Amnd.1



Currency and PaymentsfromTota, asExchange DesignatedSupplier specified in Payment Date Eane Designte Component Ref.contract/linvoke.No.specfiedRate Account, in

withdrawalwpidatio Loan currencyapplication

Tom/slav, obrtz 20.715,01 kn 13.Z2016 7,61710200 2.719,54 EUR DE Invoice 6-1-1poslovne usluge_______Tom/slav, obrt zaosov, obr/ug 275,99 kn 13.7.2016 7,61710200 36,23 EUR DE

_poslovne uslugeMendel. obrt zasavjetovonje i 20.715,01 kn 13.7.2016 7,61710200 2.719,54 EUR DE Invoice 6-1-1prevodenje


prevodenjeFredrick Dahlen 23.676,01 kn 14.7.2016 7,61710200 3.108,27EUR A Invoice 2016:1

Goran Bolitevie 12.300,00 kn 18.7.2016 7,61710200 1.614,79 EUR P/U Invoice 6 2016

PPA/SPSMP-CS-lC/lA-Sanjica Frei Harper 23.317,24 kn 20.7.2016 7,61710200 3.061,17 EUR DE 05-Arnand.1

SPSMP-CS-IC/SS-/ES-Luka Fresl 4.791,66 kn 20.7.2016 7,61710200 629,07 EUR OSS

14


Marko Lucie 9.600,00 kn 27.7.2016 7,61710200 1.260,32 EUR A In voice 511

PPA/SPSM P-CS -I C/PA-Neda ulo 10,701,38 kn 4.8.2016 7,61710200 1.404,91 EUR P/U 08/1

PPA/SPSMP-CS-IC/FMA-Matej 1ltuk 11.298,75 kn 4.8.2016 7,61710200 1.483,34 EUR P/U 07/1

Ana Ben6ik 10.929,08 kn 4.8.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-IC/TRA-10

Gorian eemanovie 10.929,08 kn 4.8.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-IC/TECHA-09

PPA/SPSMP-CS-lC/FCA-Sanjica Frei Harper 23.317,25 kn 4.8.2016 7,61710200 3.061,17 EUR DE 05 -Arnand.1

Mendes. obrtzasavjetovanje i 20.715,01 kn 9.8.2016 7,61710200 2.719,54 EUR DE Invoice. 8-1-1

prevodenjeMendel. obrt zasavjetovanje i 300,00 kn 9.8.2016 7,61710200 39,39 EUR DE

prevodenjeTomislav, obrtzo 20.715,01 kn 9.8.2016 7,61710200 2.719,54 EUR DE Invoice 8-1-1poslovne uslugeTomislav, obrt zapoisy,ovne u 276,50 kn 9.8.2016 7,61710200 36,30 EUR DEposlovne usluge


HLB inlenjerskibiro 116.150,00kn 8.8.2016 7,61710200 15.248,58 EUR P/U Invoice 156-15-7d.o.o.

Goran BoNifevie 12.300,00 kn 17.8.2016 7,61710200 1.614,79 EUR P/U Invoice 712016



Sanjica Frei Harper 1.066,27kn 1.9.2016 7,61710200 139,98 EUR DE PPA/SPSM d-CS-1CFCA-05 -AmandI

Fredrick Daolen 30.293,03 kn 8.9.2016 7,61710200 3.976,98 EUR RA Invoice.2016:2

Mende§. obrt zasavjetovanje i 3.045,00 kn 7.9.2016 7,61710200 399,76 EUR DE Invoice 7-1-1prevodenje I



Currency and PaymentsfromTotal, 0s Exchange DesignatedSupplier specified in Payment Date Rate Account, inRef.contractinvoe.

withdrawal Rate cuniapplication Loan currency

Tomislav, obrtza 1.575,00 kn 7.9.2016 7,61710200 206,77 EUR DE Invoice 7-1-1poslovne uslugeMendeg. obrt zasavjetovanje i 20.715,01 kn 13.9.2016 7,61710200 2.719,54 EUR DE Invoice 9-1-1

prevodenjeMendeg. obrtzasav]etovanje i 300,00 kn 13.9.2016 7,61710200 39,39 EUR DEprevodenje

Matej lItuk 11.298,76 kn 13.9.2016 7,61710200 1.483,34 EUR P/U PPA1SPSMP-CS-I(fM4-____________071

Neda eulo 10.701,38 kn 13.9.2016 7,61710200 1.404,91 EUR P/U PPA1SPSW1P7CS-!C/PA


Gorjan eemanovie 10.929,08 kn 13.9.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-I/TECHA-09

ViziBit d.o.o. - Robert 12.417,23 kn 14.9.2016 7,61710200 1.630,18 EUR OSS Invoice 8-01-01VurugicTomislav, obrt zaTomsla,obre zg 20.715,01 kn 14.9.2016 7,61710200 2.719,54 EUR DE Invoice 9-1-1poslovne uslugeTomislav, obrtza 274,00kn 14.9.2016 7,61710200 35,97EUR DEposlovne usluge

Sanjica Frei Harper 23.317,24 kn 19.9.2016 7,61710200 3.061,17 EUR DE PPAISPSMPCS-1/FCA05 -Arnand.1

Goran Boli(evie 13.866,00 kn 20.9.2016 7,61710200 1.820,38 EUR P/U Invoice 08/2016

Mendeg. obrt zasavjetovanje i 3.272,00 kn 20.9.2016 7,61710200 429,56 EUR DE Invoice 1-2016

prevodenjeTomislav, obrtza 3.272,00 kn 20,9.2016 7,61710200 429,56 EUR DE Invoice 1-2016poslovne usluge

ViziBit d.o.o. - Robert 41.058,63 kn 30.9.2016 7,61710200 5.390,32 EUR OSS Invoice 9-01-01Vuru§ie

Selectio ltd. 165.270,83 kn 6.10.2016 7,61710200 21.697,34 EUR RA Invoice 443-VPI-1

PPA/SPSMP-CS-IC/FMA-11.298,75 kn 10.10.2016 7,61710200 1.483,34 EUR P/U 07/

Matej lItuk 0_7APPA/SPSMP-CS-lC/PA-

Neda fulo 10.701,38 kn 10.10.2016 7,61710200 1.404,91 EUR P/U 08/1

Ana Beneik 10.929,08 kn 10.10.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-lC/TRA-10


Sanjica Frei Harper 23.317,25 kn 10.10.2016 7,61710200 3.061,17 EUR DE PPA1SPSMP-S-1CFCA-05 - Amand.1

Sanjica Frei Harper 4.862,00 kn 19.9.2016 7,61710200 638,30 EUR DE PN 787/16


Branka Novosel 22.163,14 kn 12.10,2016 7,61710200 2.909,66 EUR DE Invoice 28-360-1

Tomislav, obrtza 20.715,01 kn 12.10.2016 7,61710200 2.719,54 EUR DE Invoice 11-1-1poslovne uslugeTomislav, obrt za

osloerutzu 274,00 kn 12.10.2016 7,61710200 35,97 EUR DEposlovne uslugeMendeg. obrt zasavjetovanje I 20.715,01 kn 12.10.2016 7,61710200 2.719,54 EUR DE Invoice 11-1-1prevodenje _ I I_I



Currency and Payntsfromu rTotal, Exchange Designated

Supplier specified In Payment Date RteComponent Ref.contractinvoe.No.withdrawal Rate cunt,ninapplication Loan currency

Mende§. obrt zasavetovanje i 211,00 kn 12.10.2016 7,61710200 27,70 EUR DEprevodenje

Marko Lucie 9.600,00 kn 12.10.2016 7,61710200 1,260,32 EUR A Invoice 71 1

Marko Lucie 2.880,00 kn 12,10,2016 7,61710200 378,10 EUR A Invoice 81

Goran Bolitevie 12.300,00 kn 24.10.2016 7,61710200 1.614,79 EUR P/U Invoice 0912016ViziBit d.o.o. - Robert 43.481,19 kn 31.10.2016 7,61710200 5.708,36 EUR OSS Invoice 11-01-01

Vuruie~_______ ______ ___________

Branka Novosel 22.163,14 kn 3.11.2016 7,61710200 2.909,66 CUR DE Invoice 30-360-1

PPA/SPSMP-CS-lC/FMA-11.298,75 kn 10.11.2016 7,61710200 1.483,34 EUR P/U 07/1

Matej I§tuk 07/1PPA/SPSMP-CS-ll/PA-

10.701,38 kn 10.11.2016 7,61710200 1.404,91 EUR P/UNeda eulo 084

Gorjon eemanovie 10.929,08 kn 10.11.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-IC/TECHA-09

Ana Beneik 10.929,08 kn 10.11.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-lC/TRA-10PPAISPSMP-CS-IC/FlC-

Sanjica Frei Harper 23.317,25 kn 10.11.2016 7,61710200 3.061,17 EUR PlU 05 - Arnnd.1

Tomislov, obrtzo 20.715,01 kn 14.11.2016 7,61710200 2.719,54 EUR DE Invoice 12-1-1poslovne usluge

Tomisla, obrt zooisl,ob a 269,00 kn 14.11.2016 7,61710200 35,32 EUR DE

poslovne uslugeMendeg. obrtza

savjetovanje i 20.715,01 kn 14.11.2016 7,61710200 2.719,54 EUR DE Invoice 12-1-1prevodenje

Mende§. obrt zasavjetovanje i 156,00 kn 14.11.2016 7,61710200 20,48 EUR DE

prevodenje

Goran Boli6evie 12.300,00 kn 17.11.2016 7,61710200 1.614,79 EUR P/U Invoice 10/2016

Deloittesavjetodavne usluge 88.941,23 kn 24,11.2016 7,61710200 11.676,52 EUR OSS Invoice HRO2-6375

d.o.o.

Marko Lucie 9.600,00 kn 24.11.2016 7,61710200 1.260,32 EUR RA Invoice 9/1/1

Fredrick Dahlen 27.160,20 kn 29.11.2016 7,61710200 3.565,69 EUR RA Invoice 2016:3

Tomisla, obrt zooslvne us/tge 146,00 kn 29.11.2016 7,61710200 19,17 EUR DE Invoice 10-1-1

poslovne uslugeMende§. obrt zosavjetovanje i 96,00 kn 29.11.2016 7,61710200 12,60 EUR DE Invoice 10-1-1prevodenje

Sonjica Frei Harper 998,82 kn 29.11.2016 7,61710200 131,13 EUR DE Invoice for mobile phonerexpences 6-8/2016

ViziBit d.o. - RobertVit..- 20.276,81 kn 7.12.2016 7,61710200 2.662,01 EUR OSS Invoice 13-01-01Vurusic

PPA/SPSMP-CS-lC/FMA-Matej lItuk 11.298,76 kn 12.12.2016 7,61710200 1.483,34 EUR P/U 07/1

Ana Beneik 10.929,08 kn 12.12.2016 7,61710200 1.434,81 EUR PlU SPSMP-CS-K/CTRA-10

Gorjan emanoviW 10.929,08 kn 12.12.2016 7,61710200 1.434,81 EUR P/U SPSMP-CS-lC/TECHA-09

Neda eulo 10.701,38 kn 12.12.2016 7,61710200 1.404,91 EUR P/U PPA/SPSMP-CS/PA-08/1



Currency and PaymentsfromTota, asExchange Designated

Supplier specified In Payment Date cane Designte Component Ref.contract/Involce.No.specifed inRate Account, inwithdrawalapplication Loan currency

Branka Novosel 22.163,14 kn 13.12.2016 7,61710200 2,909,66 EUR DE invoice.4360 .

Tomnisla, obrt zaTomslaob u zg 20.715,01 kn 13.12.2016 7,61710200 2.719,54 EUR DE Invoice 13-1-1

_poslovne usluge ------Tomislov, obrtza 269,00 kn 13.12.2016 7,61710200 35,32 EUR DE

Mendeg. obrt zasavjetovanje i 20.715,01 kn 13.12.2016 7,61710200 2.719,54 EUR DE Invoice 13-1-1

prevodenjeMendeg. obrtzasavjetovanje i 208,99 kn 13.12.2016 7,61710200 27,44 EUR DEprevodenje

Marko Lucie 9.120,00 kn 15.12.2016 7,61710200 1.197,31 EUR A Invoice 10 1

Sanjica Frei Harper 762,00 kn 20.12.2016 7,61710200 100,04 EUR DE PN 87/16

Goran Boieevie 12.300,00 kn 19.12.2016 7,61710200 1.614,79 EUR PIU In voice 11-1-1

Sanjica Frei Harper 23.317,24 kn 22.12.2016 7,61710200 3.061,17 EUR DE05 - Amand. 1


Total 5.532.748,58 kn 726.377,98 EUR

Note: * Corresponding invoice is split on amount paid from funds converted at 7,576750 echange rate. The remainingamount and subsequent payments are made in line with the new rate, as per table 7.2.5.

All presented expenditures paid during 2016, due to sufficent funds in the Operations Account, werenot subject of withdrawal application based on the SoE (from IBRD account to Designated Account).

7.3.2.2 Payments from Operations Account in Treasury in 2015, converted to Loan currency,which were not subject of withdrawal application

In order to present the total of eligible expenditures which can be subject of withdrawal applicationin 2017 based on the SoE, the following table also includes all eligible expenditures in 2015 whichwere not subject of withdrawal application.

Currency andCuorey and Payments fromSuppr s e iExchange Designated Ref.contract/Invoice

Supplier specified in Payment Date RaeAcut n ComponentNowithdrawal Rate Account, in No.application Loan currency

PPA/SPSMP-CS-Matej lItuk 11.298,75 kn 6.10.2015 7,57675000 1.491,24 EUR P/U ISSM-0S

IC/FMA-071

PPA/SPSMP-CS-Neda Culo 10.701,38 kn 6.10.2015 7,57675000 1.412,40 EUR P/U IPA-S

IC/PA-081



Cuirrency and PaymentsfromTotal, as Paesn t d r

Supplier specified in Payment Date Exchange Designated Component Refcontract/Invoewithdrawal Rate Account, in t Noapplication Loan currency

Ana Beneik 10.929,08 kn 6.10.2015 7,57675000 1,442,45 EUR P/U SPSMP-CS-IC/TRA-10

Gor]an eemonovle 10.929,08 kn 6.10.2015 7,57675000 1.442,45 EUR P/U SPSMP-CS-IC/TECHA-09

PPA/SPSMP-CS-Sonjico Frel Harper 23.317,24 kn 6.10.2015 7,57675000 3.077,47 EUR DE IC/FCA-05 -

Amond.1

Pedala Bus 5.150,00 kn 15.10,2015 7,57675000 679,71 EUR OSS Invoice 83/TR1/1

Tomislay, obrt zaposlovne usluge 20.715,01 kn 15.10.2015 7,57675000 2.734,02 EUR DE Invoice 3-1-1

Tomislav, obrtza 369,21 kn 15.10.2015 7,57675000 48,73 EUR DE Invoice 3-1-1poslovne usluge

Tomislav, obrt zaposlovne usluge 170,00 kn 15.10.2015 7,57675000 22,44 EUR DE Invoice 3-1-1

Mende§. obrt zasovjetovanje i 20.715,01 kn 15.10.2015 7,57675000 2.734,02 EUR DE Invoice 3-1-1prevodenje

Mende§. obrt zasavjetovanje i 351,00 kn 15,10.2015 7,57675000 46,33 EUR DE Invoice 3-1-1prevodenje

Mendel. obrt zosavjetovanje i 170,00 kn 15.10.2015 7,57675000 22,44 EUR DE Invoice 3-1-1prevodenje

Goran Bolieevid 15.400,00 kn 15.10.2015 7,57675000 2.032,53 EUR P/U SPSMP-CS-IC/FA-11

TEB d.o.o. 180,00 kn 15.10.2015 7,57675000 23,76 EUR OC Invoice 5983-1-77


Matej lItuk 11.298,75 kn 4.11.2015 7,57675000 1.491,24 EUR P/U PPAI/SPSMP-CS-IC/FMA-071

Nedo fulo 1 0.701,38 kn 4.11.2015 7,57675000 1.412,40 EUR P/U PPAI/SPSMP-CS-

IC/PA-081



Curricyanuid fPayuent fronTotal, as~Tota, asExchange Dt-signored Ref.contract/invoicr

Supplier spified in Payment Date R Account Component No.

wit hdrawa/lRtecou,gIapihdatio knon currencyapplicotion

Ana Beneik 10.929,08 kn 4.11.2015 7,57675000 1.442,45 FUR P/U SPSMPCSICTRA10

Gorlan eemanovie 10.929,08 kn 4.11.2015 7,57675000 1.442,45 FUR P/U SPSMPCSIC/TECH4A-09

Branka Novosel 22.530,64 kn 9.11,2015 7,57675000 2.973,65 FUR DE Invoice 18-360-1

Tomislav, obrtza 20,715,01 kn 11,11,2015 7,57675000 2.734,02 FUR DE Invoice 4-1-1poslovne usluge

Tom/islav, obrt za 170,44 kn 11.11.2015 7,57675000 22,50 FUR DE Invoice 4-1-1poslovne usluge

Mendel. obrtzasovjetovanje / 20.715,01 kn 11.11.2015 7,57675000 2.734,02 FUR DE Invoice 4-1-1prevodenje

Mendeg. obrt zasavjetovanje i 156,58 kn 11.11.2015 7,57675000 20,67 FUR DE Invoice 4-1-1prevodenje

SPSMP-CS-Ratko Mutavdie 11.081,52 kn 11.11.2015 7,57675000 1.462,57 FUR OS S C/MISOS-

IC/MISOSS-ISA-16

Revezeto Project Fkt. 33.544,09 kn 11.11.2015 7,57675000 4.427,24 FUR OSS InvoceEUR00003/2015

PPA/SPSMP-CS-Sanjica Frei Harper 23.317,24 kn 11.11.2015 7,57675000 3.077,47 EUR DE IC/FCA-05 -

Amand.1

SPSMP-CS-lC/OSS-Luka Fresi 28.308,40 kn 11.11.2015 7,57675000 3.736,22 FUR OS SMFS-/

EIES-14

Goron Bolidevie 15.400,00 kn 16.11.2015 7,57675000 2.032,53 FUR P/U SPSMP-CS-IC/FA-11

Top pet multimedija 4.612,50 kn 19.11.2015 7,57675000 608,77 FUR DE Invoice 1-14-1j.d.o.o.

SPSMP-CS-IC/OSS-Luka Fresl 25.1 95,35 kn 20.11.2015 7,57675000 3.325,35 FUR 0OSSFS1EIES-14

Branka Novosel 22.163,14 kn 2.12.2015 7,57675000 2.925,15 FUR DE Invoice 21-360-1

InvoiceFIV d.o.o. 6.628,51 kn 3.12.2015 7,57675000 874,85 FUR P/U Inv/

3743/Va02/10001



Currency and Payments from.otal, as Exchange Designated Ref.contract/linvoke

Supplier specified in Payment Date Rate Account, In Component No.withdrawalnpplication Loan currency

PPA/SPSMP-CS-MateJl1tuk 11.298,75 kn 4.12.2015 7,57675000 1.491,24 EUR P/U PPIM-CS-

IC/FMA-071

PPA/SPSMP-CS-Neda Cu/o 10.701,38 kn 4.12.2015 7,57675000 1.412,40 EUR P/U IP MP-8/1

IC/PA-081

SPSMP-CS-lC/TRA-Ana Benf/k 10.929,08 kn 4.12.2015 7,57675000 1.442,45 FUR P/U 10

10

SPSMP-CS-Gor]an eemanovie 10.929,08 kn 4,12,2015 7,57675000 1.442,45 FUR P/U IC/TFCA-

IC/TECHA-09

PPA/SPSMP-CS-Sanjica Frei Harper 23.317,24 kn 4.12.2015 7,57675000 3.077,47 EUR OF IC/FCA-05 -

Amand.1

Tomisla, obrtza 20.715,01 kn 7.12.2015 7,57675000 2.734,02 FUR DE Invoice 5-1-1poslovne usluge

Tomisla, obrt zo 171,93 kn 7.12.2015 7,57675000 22,69 FUR DE Invoice 5-1-1poslovne usluge

Mendel. obrt zasavjetovanje I 20.715,01 kn 7.12.2015 7,57675000 2.734,02 FUR DE Invoice 5-1-1prevodenje

Mendel. obrt zasavjetovanje i 166,00 kn 7.12.2015 7,57675000 21,91 FUR OF Invoice 5-1-1prevodenje

FIVd.o.o. 282,18 kn 7.12.2015 7,57675000 37,24 FUR P/U Invoice3849/V002/10001

Goran Boieevie 15.400,00 kn 7.12.2015 7,57675000 2.032,53 FUR P/U SPSMP-CS-IC/FA-11

Pedala Bus 28.500,00 kn 11.12.2015 7,57675000 3.761,51 FUR CDCI Invoice 120-TR1-1

Marko Lucie 18.147,44 kn 11.12.2015 7,57675000 2.395,15 FUR A Invoice 3/1/1

SPSMP-CS-lC/OSS-Luka Fresl 27.687,01 kn 14.12.2015 7,57675000 3.654,21 FUR OSS FMFS-/0

EIES-14

Invoice 1451-201 84-Liburnia riviera hotel 220.901,50 kn 21.12.2015 7,57675000 29.155,18 FUR CDCI 11

11

Int ece 1451-201S4-Liburnia ritimero hurel 14 000.00 An 21.12.2015 7,57675000 1.4 7,76 EUR COC4

11



Currency and PaymentsfromTotal, as Exchange Designated Ref.contract/invoice

Supplier specfied in Payment Date Rate Account, in Component No.withdrawalwpicdaia Loan currencyapplication

Daily allowance (asperl talordne (525,00 kn 31.12.2015 7,576750 69,29 EUR P/U TOper travel order)

Total 854.699,09 kn C 112.805,50

7.3.2.3 Total of eliqible expenditures, not subject of withdrawal application

Due to small amount of Project expenditures incurred in 2016, and sufficient funds in Project'sOperations Account to cover such expenditures, the PIU did not initiate any requests for withdrawalapplication in 2016 for any of incurred expenditures in 2016.

As indiciated in table (point 7.3.2.1), eligible expenditures in 2016 amounted to EUR 726,377.98. Inpoint 7.3.2.2, indicated are expenditures incurred in 2015, which were not subject of withdrawalapplication and which amount to 112,805.50 EUR.

In Zagreb, May 3 0th, 2017

S te Secretary and Loan ManagerMarin Strmota, PhD


Nal/36/2016-1 01E

*in2enjerski Biro

HLB Inienjerski biro d.o.o.Rijeka, Strossmayerova 11OB 89015118914T +385 51 322 303F 051 725 377;E [email protected]: www.ibr.hr

HLB In2enjerski biro d.o.o. is legal entity registered inRepublic of Croatia for conducting audit, accounting andbusiness advisory services and it is member of HLBInternational global network.

HLB International is a world - wide network of independentprofessional accounting firms and business advisers. Thenetwork comprises member firms in over 100 countries who,collectively, have more than 1720 partners and 13.510 staff inover 450 offices.

HLB International is a member of Forum of firms. OurCompany is Network representative for Repubic of Croatia'sterritory.

Company is specialized for providing all kinds of auditservices to virtually all sorts of industry and governmentbodies, and is member of Croatia Audit Chamber.

www.hlb-croatia.com www.hlbi.com

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