41456-023: Water Sector Investment Program - Tranche 1

Audited Project Financial Statements

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 the State Bank of Vietnam

Project Number: 41456-023 Loan/Grant Number: 2754 Period covered: 1 January 2015 to 31 December 2015

VIE: WATER SECTOR INVESTMENT PROGRAM – TRANCHE 1

Prepared by SAIGON WATER CORPORATION

For the Asian Development Bank Date received by ADB: 30 JUNE 2016

Consolidated Financial Statements

SAI GON WATER CORPORATION - ONE MEMBER LIMITED

For the fiscal year ended 31 December 2015

(Audited)

Sai Gon Water Corporation — One Member Limited

No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City

CONTENT

Pages

Report of the Board of Directors 02-03

Independent Auditors' Report 04-05

Consolidated Financial Statements (Audited)

Consolidated Statement of Financial Position 06-09

Consolidated Statement of Income 10

Consolidated Statement of Cash Flows 11-12

Notes to the Consolidated Financial Statements 13-52

1

Sai Gon Water Corporation — One Member Limited No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City

REPORT OF THE BOARD OF DIRECTORS

The Board of Directors of Sai Gon Water Corporation - One Member Limited (the "Corporation") presents its report and the Corporation's consolidated financial statements for the fiscal year

ended 31 December 2015.

THE CORPORATION

Sai Gon Water Corporation — One Member Limited, formerly known as HCMC Water Supply Company, was transformed to parent - subsidiary company model and established under Decision No. 85/2005/QD-UB dated 24 May 2005 of Ho Chi Minh City's People Committee. Under Decision No. 3624/QD-UBND dated 18 August 2010 of Ho Chi Minh City's People Committee, the Corporation has transformed to One Member Limited Company under parent —subsidiary company model since 01 October 2010. The Corporation's head office is located at

No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City.

Details of the Corporation's subsidiaries and associated companies to be consolidated under the

equity method are presented in the Notes to the Consolidated Financial Statements.

BOARD OF MEMBERS AND BOARD OF DIRECTORS

The Board of Directors and the Board of Members who held office during the year and to the date

of this report is:

Mr. Tran Van Khuyen

Mr. Phan Van Phung

Mr. Ho Van Lam

Mr. Bui Thanh Giang

Mrs. Duong Quynh Nga

Mr. Bach Vu Hai

Mr. Nguyen Thanh Su

Mr. Bui Thanh Giang

Mr. Nguyen Van Du

Mr. Bach Vu Hai Mr. Nguyen Thanh Su

AUDITORS

Chairman

Chairman Member, General Director

Member

Member

Member

Member Deputy General Director

Deputy General Director



Appointed on 07 Apr 2015

Retired on 01 Mar 2015 Appointed on 12 Mar 2015

Retired on 12 Mar 2015

Resigned on 30 Sept 2015

Resigned on 30 Sept 2015

The auditors of the AASC Limited take the audit of the consolidated financial statements for the

Corporation.

STATEMENT OF THE BOARD OF DIRECTORS' RESPONSIBILITY IN RESPECT OF THE

CONSOLIDATED FINANCIAL STATEMENTS

The Board of Directors is responsible for the consolidated financial statements of each fiscal year

which give a true and fair view of the financial position of the Corporation and the results of its

operation and its cash flows for the year then ended. In preparing those consolidated financial

statements, the Board of Directors is required to:

- Establish and maintain of an internal control system which is determined necessary by the

Board of Directors and those charged with governance to ensure the preparation and

presentation of consolidated financial statements do not contain any material misstatement

caused by errors or frauds;

- Select suitable accounting policies and then apply them consistently;

- Make judgments and estimates that are reasonable and prudent;

- State whether applicable accounting standards have been followed, subject to any material

departures disclosed and explained in the consolidated financial statements;

05

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2

Sai Gon Water Corporation - One Member Limited


Prepare and present the consolidated financial statements on the basis of compliance with Vietnamese accounting standards and system and other related regulations; Prepare the consolidated financial statements on going concern basis unless it is

inappropriate to presume that the Corporation will continue in business.

The Board of Directors is responsible for ensuring that proper accounting records are kept which disclosed, with reasonable accuracy at any time, the financial position of Corporation and to ensure that the accounting records comply with the registered accounting system. It is responsible for safeguarding the assets of the Corporation and hence for taking reasonable steps

for the prevention and detection of fraud and other irregularities.

The Board of Directors confirms that the cosolidated financial statements of the Corporation for the year ended 31 December 2015 prepared by us, give a true and fair view of the financial position, results of its operations and its cash flows for the year then ended in accordance with

t 1:-.*$ ry ese Accounting System and comply with relevant statutory requirements of preparing

' 49 • • the consolidated financial statements.

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Nguyen Van ID

Deputy Ge al Director

Ho Chi Minh, 25 April 2016

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No. 1405/2016/BC.KTTC-AASC.DTNN1

INDEPENDENT AUDITORS' REPORT

To:

The Board of Directors Sai Gon Water Corporation — One Member Limited

We have audited the consolidated financial statements of Sai Gon Water Corporation - One Member Limited ("the Corporation"), as set out on pages 06 to 52, including: Consolidated statement of financial position as at 31 December 2015, Consolidated statement of income, Consolidated statement of cash flows and Notes to the consolidated financial statements for

the year then ended.

Board of Directors' Responsibility

Board of Directors is responsible for the preparation and fair presentation of these

consolidated financial statements that give a true and fair view in accordance with Vietnamese Accounting Standards and System and comply with relevant statutory

requirements and for such internal control as management determines necessary to enable the preparation and fair presentation of these consolidated financial statements that are free

from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based

on our audit. We conducted our audit in accordance with Vietnamese Standards on

Auditing. Those standards require that we comply with standards, ethical requirements and

plan and perform the audit to obtain reasonable assurance about whether the consolidated

financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the consolidated financial statements. The procedures selected depend on the

auditor's judgment, including the assessment of the risks of material misstatement of the

consolidated financial statements, whether due to fraud or error. In making those risk

assessments, the auditor considers internal control relevant to the entity's preparation of

consolidated financial statements that give a true and fair view 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 entity's internal control. An audit also includes

evaluating the appropriateness of accounting policies used and the reasonableness of

accounting estimates made by management, as well as evaluating the overall presentation

of the consolidated financial statements.

We believe that the audit evidences we have obtained are sufficient and appropriate to

provide a basis for Qualified opinion.

Basis for Qualified Opinion

The Corporation is currently reclassifying and considering necessary resolutions for the

"Construction in progress" (together with its associated liabilities) in relation to works whose

contracts had been signed prior to 2007 amounting to VND 24,019,841,119 (those value as

at 01 January 2015 was VND 26,718,070,714). Thus, the resolution which should have been

made, is not presented in the Corporation's consolidated financial statements; and

T. (84) 4 3824 1990 I F: (84) 4 3825 3973 I 1 Le Phung Hieu, Hanoi, Vietnam A member of HLB International

4 HANG KIG'M TOAN AASC

Limited

•

o Manh Cuong


Registered Auditor No.:

0744-2013-002-1

Hanoi, 25 April 2016

The Corporation has submitted the Letter No. 284/TCT-DASG1 dated 18 January 2016 to Ho Chi Minh City Department of Finance (3rd time) which is not to agree with the Decision No. 67041QD-UBND dated 28 December 2012 of Ho Chi Minh City's People Committee regarding the

finalization of the project "Sai Gon Water Supply System Phase I" — which has been handed over from Sai Gon Water Exploiting Investment Company as a result of the merger on 30 June 2000 with total finalized amount of VND 944,096,952,081 — therefore, relevant items to this project

have not been adjusted on the Corporation's consolidated financial statements (Note 6iii, Note

12, Note 14i, Note 20i, Note 21ix); and

The balances of receivables and payables of Transportation and Public Works JSC (the Corporation's subsidiary until 01 Nov 2015) were not fully confirmed as at 01/01/2015 with the

amount of VND 57,324,734,410. Moreover, intercompany opening balances of this company (at the same time), including "Other short term receivables" (Note 6i) and "Other short term payables" (Note 20iii), were not eliminated before consolidating into the consolidated financial statements of the Corporation. Thus, by available information and alternative audit procedures, we are not able to give an opinion on these items and its possible implication on the consolidated

financial statements as at 01/01/2015.

Qualified Opinion

In our opinion, except for the matters described in the "Basis for Qualified Opinion"

paragraph and its possible effect, the consolidated financial statements give a true and fair view,

in all material respects, of the financial position of Sai Gon Water Corporation - One Member

Limited as at 31 December 2015, and of the results of its operation and cash flows for the year

then ended in accordance with the Vietnamese Accounting Standards, Vietnamese Enterprise Accounting System and the statutory requirements relevant to preparation and presentation of

consolidated financial statements.

Other Matter

We draw readers' attention that our audit precedures are exclusive of audit procedures required by the Vietnamese Standards on Auditing No. 1000 — Audit of finalization report of construction

contract. Therefore, balance of "Construction in Progress" may be changed upon completed

construction audit under such auditing standards.

Pham Thanh Nhan

Auditor

Registered Auditor No.:

1612-2013-002-1

5

Sai Gon Water Corporation — One Member Limited Consolidated Financial Statements

No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City For the year ended 31/12/2015

CONSOLIDATED STATEMENT As at

Code ASSETS

OF FINANCIAL POSITION

31 December 2015

Note 31/12/2015

01/01/2015

(Adjusted)

VND VND

100 A. CURRENT ASSETS 2,039,959,897,588 2,547,222,922,583

110 I. Cash and cash equivalents 3 761,438,948,400 782,063,991,414

111 1. Cash 329,337,392,063 319,531,880,860

112 2. Cash equivalents 432,101,556,337 462,532,110,554

120 II. Short-term investment 15 638,808,659,508 634,570,015,018

123 3. Held to maturity 638,808,659,508 634,570,015,018

130 Ill. Short-term receivables 292,245,070,135 733,779,271,855

131 1. Short-term trade receivables 4 43,326,042,800 312,439,713,177

132 2. Short-term advances to

suppliers

5 204,699,492,007 88,878,094,830

136 6. Other short-term receivables 6 56,066,468,710 342,426,611,349 I 1

137 7. Provisions for short-term bad

debts

139 8. Shortage of assets awaiting

resolution

8

7

(18,639,485,465)

6,792,552,083

(17,251,987,305)

7,286,839,804 • \C

140 IV. Inventories 11 156,373,009,067 273,342,815,873 -7'€C-i\ 141 1. Inventories 156,406,844,733 273,380,002,724

149 2. Provision for obsolescence of

inventories

(33,835,666) (37,186,851)

150 V. Other current assets 191,094,210,478 123,466,828,423

151 1. Short-term prepaid expenses 9 15,329,700,133 12,533,712,670

152 2. VAT deductibles 167,788,305,746 103,447,812,619

153 3. Tax and other receivables

from the State

17 7,976,204,599 7,485,303,134

200 B. NON-CURRENT ASSETS 8,201,641,227,962 7,021,726,932,936

210 I. Long-term receivables 75,795,062,138 45,537,780,135

212 2. Long-term advances to

suppliers

5 16,158,472,598 16,158,472,598

216 6. Other long-term receivables 6 59,636,589,540 29,379,307,537

220 II. Fixed assets 5,228,956,993,950 4,605,494,498,897

221 1. Tangible fixed assets 12 5,164,145,047,206 4,417,277,959,703

222 - Cost 12,370,195,218,916 10,847,902,747,696

223 - Accumulated depreciation (7,206,050,171,710) (6,430,624,787,993)

227 3. Intangible fixed assets 13 64,811,946,744 188,216,539,194

228 - Cost 108,000,447,234 226,547,094,800

229 - Accumulated amortisation (43,188,500,490) (38,330,555,606)

230 III. Investment properties 416,066,065

231 - Cost 2,259,572,500

232 - Accumulated depreciation (1,843,506,435)

6



CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 31 December 2015

(continued)

01/01/2015

Code ASSETS Note 31/12/2015 (Adjusted)

VND VND

240 IV. Long-term assets in progress 2,276,343,303,749 1,811,690,089,304

242 2. Construction in-progress 14 2,276,343,303,749 1,811,690,089,304

250 V. Long-term investments 15 306,740,650,730 267,464,652,997

252 2. Investments in joint-ventures,

associates

215,132,320,730 121,356,322,997

253 3. Other investments in equity

instruments

72,600,000,000 72,600,000,000

255 5. Held to maturity 19,008,330,000 73,508,330,000

260 VI. Other non-current assets 313,389,151,330 291,539,911,603

261 1. Long-term prepaid expenses 9 104,024,565,702 16,554,542,646

262 2. Deferred tax assets 2,512,387,735 2,700,148,961

263 3. Long-term equipments,11

supplies and spare-parts

206,852,197,893 272,285,219,996

270 TOTAL ASSETS 10,241,601,125,550 9,568,949,855,519

7



CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2015 (continued)

01/01/2015

Code RESOURCES Note 31/12/2015 (Adjusted)

VND VND

300 A. LIABILITIES 4,083,307,454,843 3,609,404,846,413

310 I. Current liabilities 1,702,275,337,120 1,839,860,827,343

311 1. Short-term trade payables 16 646,851,936,277 388,310,163,366

312 2. Short-term advances from

customers

18 18,321,155,589 96,845,855,314

313 3. Tax payables and statutory

obligations

17 161,324,265,320 191,731,456,919

314 4. Payables to employees 148,703,317,841 148,028,251,258

315 5. Accrued short-term expenses 19 67,977,128,120 295,875,760,939

319 9. Other short-term payables 20 267,589,696,404 390,421,298,534

320 10. Short-term loans and

liabilities

22 291,264,895,179 256,595,978,096

322 12. Bonus and welfare funds 100,242,942,390 72,052,062,917

330 II. Long-term liabilities 2,381,032,117,723 1,769,544,019,070

331 1. Long-term trade payables 16 272,032,141,652 193,162,686,698

336 6. Long-term unrealized revenue - 76,498,182

337 7. Other long-term payables 21 258,270,845,930 304,237,314,895

338 8. Long-term loans and liabilities 22 1,838,784,820,825 1,268,467,519,295

343 13. Scientific and Technological 11,944,309,316 3,600,000,000

Development Fund

400 B. EQUITY 6,158,293,670,707 5,959,545,009,106

410 I. Owner' equity 6,108,900,268,201 5,906,556,772,453

411 1. Contributed charter capital 23 5,001,160,428,996 4,786,269,327,748

414 4. Other Owner's equity 23 461,174,182 39,789,046,892

416 6. Assets revaluation differences 5,828,221,719

417 7. Foreign exchange differences 6,166,949,241

418 8. Investment and development

fund

23 226,738,340,590 283,008,349,272

419 9. Business arrangement

assitance fund

23 314,214,513,245 100,991,620,568

420 10. Other funds of owner's equity 370,900,003 -

421 11. Retained earnings 23 30,373,815,168 159,009,818,328

421b Undistributed profit of this year 30,373,815,168 159,009,818,328

422 12. Construction investment fund 23 21,603,706,889 24,832,145,805

429 1. Minority interest 23 513,977,389,128 500,661,292,880

8

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Sai Gon Water Corporation — One Member Limited Congolidated Financial Statements


CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2015 (continued)

01/01/2015

Code

RESOURCES Note 31/12/2015 (Adjusted)

VND VND

430 II. Budget sources and other funds

431 1. Budget resources

432 2. Budget resources used to

acquire fixed assets

Nguyen Van Du Deputy G al Director


49,393,402,506 52,988,236,653

1,096,272,607

49,393,402,506 51,891,964,046

10,241,601,125,550 9,568,949,855,519

Dang Duc Hien Chief Accountant

9

26 69,710,133,824

27 99,575,607,269

70,172,541,045

3,398,919,126

28 1,402,240,422,651

29 428,998,828,329

194,105,401,377

30 138,379,820,783

31 16,375,030,836

122,004,789,947

319,509,110,450

69,729,831,712

187,761,226

76,307,021,548

60,544,812,721

60,514,548,023

2,328,067,931

1,202,437,343,373

405,641,689,080

270,180,309,397

132,761,733,742

33,206,737,179

99,554,996,563

372,063,373,891

87,135,614,469

(76,355,399)

249,591,517,512

196,141,952,917

53,449,564,595

285,004,114,821

218,981,881,432

66,022,233,389

61 19. Profit after tax contributable

o Holding company

it after tax of minority

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CONSOLIDATED STATEMENT OF INCOME Year 2015

Code ITEMS Notes Year 2015

VND

Year 2014

(Adjusted)

VND

01 1. Gross revenues from goods

sold and services rendered

02 2. Less deductions

10 3. Net revenues from goods

sold and services rendered

11 4. Cost of sales

20 5. Gross profit from goods sold

and services rendered

24 4,098,028,497,028

3,961,714,198,024

24 2,909,250,709 4,205,561,189

24 4,095,119,246,319 3,957,508,636,835

25 2,039,909,120,517

2,095,011,503,812

2,055,210,125,802

1,862,497,133,023

21 6. Financial income

22 7. Financial expenses

23 In which: Interest expense

Profit in associates/

joint ventures

25 8. Selling expenses

26 9. General administrative expenses

30 10. Operating profit

31 11. Other incomes

32 12. Other expenses

40 13. Other profit

50 14. Accounting profit before tax

51 15. Corporate income tax - current

52 16. Corporate income tax - deferred

60 18. Net profit after tax

Nguyen n Du Deputy General Director


Dang Duc Hien Chief Accountant

10



Consolidated Financial Statements For the year ended 31/12/2015

CONSOLIDATED STATEMENT OF CASH FLOWS

Year 2015 (Indirect method)

Code ITEMS Notes

I. CASH FLOWS FROM OPERATING ACTIVITIES

Year 2015 Year 2014

(Adjusted)

VND VND

01 1. Profit before tax 319,509,110,450 372,063,373,891 2. Adjustments for:

02 Depreciation and amortisation 834,235,154,553 781,906,186,065 03 Provisions 1,384,146,975 (26,826,553,798) 04 (Gains) from foreign exchange

differences due to revaluation (60,569,111) (479,374,075)

05 (Gains) from investment activities (98,168,206,591) (121,307,772,049) 06 Interest expense 70,172,541,045 60,514,548,023 07 Other adjustments (7,105,472,781) 08 3. Profit from operating

activities before changes in

working capital

1,119,966,704,540 1,065,870,408,057

09 (Increase) in receivables (289,390,999,295) (39,608,242,470) 10 (Increase)/Decrease in inventories 56,714,458,321 (173,214,963,628) 11 Increase/(Decrease) in payables (215,299,597,473) 1,073,041,633,446

(excluding interest payables/

corporate income tax payables) 12 (Increase) in prepaid expenses (90,266,010,519) (10,420,725,947) 14 Interest paid (66,225,333,800) (67,860,977,988) 15 Coporate income tax paid (109,100,647,470) (70,565,556,21.5) 16 Other receipts from operating activities 13,285,635,513 52,979,472,101 17 Other payments on operating activities (88,457,120,149) (88,641,819,532) 20 Net cash inflows from operating

activities 331,227,089,668 1,741,579,227,824

II. CASH FLOWS FROM INVESTING ACTIVITIES 21 1. Purchase of fixed assets and

other long-term assets (1,343,234,633,353) (1,922,480,486,836)

22 2. Proceeds from disposals of fixed

assets and long-term assets 14,923,083,870 5,465,943,305

c.,01

23 3. Loans granted, purchases of

debt instruments of other entities (914,497,515,499) (1,123,782,313,205) ,rki\IAG

24 4. Collection of loans, proceeds

from sales of debt instruments 938,258,871,009 1,009,335,904,418 P

25 5. Investment in other entities (22,500,000,000) (63,750,000,000) 27 7. Interest, dividends and profit received 68,630,200,735 70,898,845,816 30 Net cash outflows from

investing activities (1,258,419,993,238) (2,024,312,106,502)

11

292,709,849,704

941,671,879,266

(259,917,944,214)

(67,956,493,311)

906,507,291,445

(20,685,612,125)

782,063,991,414

60,569,111

761,438,948,400

55,529,534,923

463,589,822,156

(234,105,505,384)

(58,253,689,151)

226,760,162,544

(55,972,716,134)

837,551,295,564

485,411,984

782,063,991,414

Dang Duc Hien

Chief Accountant

I Sai Gon Water Corporation — One Member Limited



CONSOLIDATED STATEMENT OF CASH FLOWS

Year 2015 (continued)

Code ITEMS Notes

Year 2015

VND

Year 2014

(Adjusted)

VND

III. CASH FLOWS FROM FINANCING ACTIVITIES

31 1. Proceeds from issue of shares

and capital contribution

33 3. Proceeds from borrowings

34 4. Repayment of borrowings

36 6. Dividends paid

40 Net cash inflows from financing

activities

50 Net decrease in cash and cash

equivalents of the year

60 Cash and cash equivalents at

beginning of the year

61 Impact of foreign exchange fluctuation

70 nd equivalents at the year-end

20)

Nguyen



12

Sai Gon Water Corporation — One Member Limited Consolidated Financial Statements No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City For the year ended 31/12/2015

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Year ended 31 December 2015

1. BACKGROUND

Overview

Sai Gon Water Corporation, formerly known as Ho Chi Minh City (HCMC) Water Supply Company, was transformed to parent - subsidiary company model and established under Decision No. 85/2005/QD-UB dated 24 May 2005 of Ho Chi Minh People City's Committee.

Under Decision No. 3624/QD-UBND dated 18 August 2010 of Ho Chi Minh City's People Committee, the Corporation has transformed to One Member Limited Company under parent - subsidiary company model since 01 October 2010.

Business activities

The main business fields of the Corporation are: managing and developing the water supply system, exploiting, producing, supplying and trading water for consumption, producing and doing business of other products and services related to water supply industry.

Legal structure

The Corporation includes its head office located at No. 01, Cong Truong Quoc Te, District 3,

Ho Chi Minh City, and its dependent units including:

- Thu Duc Water Treatment Plant; - Tan Hiep Water Treatment Plant;

- Water transmission enterprise;

- Can Gio water supply enterprise;

- Rural Ho Chi Minh City water supply enterprise;

- Ho Chi Minh City reduction of non-revenue water PMU;

- Can Gio water supply PMU;

- Reduction of non-revenue water; Strengthening and Expansion of water supply network

and institutional strengthening for Saigon Water Corporation (Phase 2011 — 2015) project

("ADB unit"); and

- Renovating and upgrading water supply system of Ho Chi Minh Water Supply and

Sanitation project ("Project ADB-1273") is an independent unit; from 2013 the PMU dissolved and handed over to the Corporation.

The consolidated financial statements of the Corporation for the year ended 31 December

2014 include the financial statements of the Sai Gon Water Corporation - One Member Ltd.

(the Separate Financial Statements), Sai Gon River Water Supply Network Project — Phase

1, and 13 subsidiaries. The number of subsidiaries in the consolidated financial statements

for the year ended 31 December 2015 decreased to 10 subsidiaries as 3 subsidiaries

became associated companies in 2015 (Detailed in the Notes below).

Details of consolidated subsidiaries and associated companies to be consolidated under the equity method as at 31/12/2015 are as follows:

13

Proportion of ownership and voting

right held (%) Principle activities

100% Producing, exploiting, purification and distributing pure water.

65.00% Management services, develop water supply systems and exploit, produce, provide pure

water for consuming and producing.

65.00% As above.




Subsidiaries to be consolidated as at 31/12/2015:

No Name of subsidiaries Head office

1 Sai Gon Ground Water Co., Ltd No. 33 Che Lan Vien, Tan Phu Dist., HCMC

2 Trung An Water Supply JSC (i) No. 333 Pham Van Dong, Go Vap Dist., HCMC

3 Tan Hoa Water Supply JSC No. 95 Pham Huu Chi, Dist. 5, HCMC

4 Ben Thanh Water Supply JSC No. 194 Pasteur, Ward. 6, Dist. 3, HCMC

5 Cho Lon Water Supply JSC No. 97 Pham Huu Chi, Dist. 5, HCMC

6 Gia Dinh Water Supply JSC No. 2 Bis No Trang Long, Ward. 14, Binh Thanh Dist., HCMC

7 Thu Duc Water Supply JSC No. 8 Khong Tu, Binh Thanh Ward, Thu Duc Dist.,

HCMC

8 Phu Hoa Tan Water Supply JSC No. 86 Tan Hung, Ward. 12, Dist. 5, HCMC

53.15% Managing, developing water supply,

providing and trading pure water.

51.00% As above.

51.21% As above.

51.00% As above.

70.39% As above.

14 I , •

11=11111111111111111•111•111111111•111110111011 11111OMINIMINIONI111111111111111=11111111111111111



No. 01 Con • Truon • Quoc Te, District 3, Ho Chi Minh Ci For the ear ended 31/12/2015


Proportion of

ownership

and voting

right held (%) Principle activities

9 Nha Be Water Supply JSC No. H2 -A Nguyen Van Linh, 53.44% As above.

Tan Phong Ward, Dist. 7,

HCMC

10 Sai Gon Clean Water Business Tan Phong Ward, Dist.7, 60.00% Exploiting, producing and supplying pure

& Investment JSC HCMC

water.

(i) Trung An Water Supply One Member Co., Ltd. transformed into Trung An Water Supply JSC since 13/01/2015.

15

• • • ill MIMI MI • INN • NMI • • NM NIB Oil • • • •

Sai Gon Water Corporation — One Member Limited No. 01 Con • Truon • Quoc Te, District 3, Ho Chi Minh Ci

Consolidated Financial Statements For the ear ended 31/12/2015

Associated companies which are consolidated under the equity method as at 31/12/2015 :


Proportion of

ownership

and voting

right held(%) Principle activities

1 Water Supply Works and Mechanical

JSC

2 Inter Square Commercial Service JSC

3 Tan Hiep Water Investment JSC

4 Transportation and Public Works JSC

(ii)

5 Transport Public Works Consultant

Co., Ltd (iii))

6 Water Design and Consultancy JSC (iv)

No. 175 Nguyen Van Dau,

Binh Thanh Dist., HCMC

No. 01 Gong Truong Quoc

Te, Ward. 6, Dist. 3, HCMC

No. 60 Nguyen Dinh Chieu,

Dist. 1,HCMC

14-16 Phan Dang Luu,

Binh Thanh Dist., HCMC

No. 336 Nguyen Trong

Tuyen, Tan Binh Dist.,

HCMC

No. 175A Nguyen Van

Dau, Binh Thanh Dist.,

HCMC

24.58% Constructing technical infrastructures, testing and

repairing water meter.

30.00%

Leasing offices.

25.00% Exploiting, producing and supplying pure water.

25.00% Construction of public works, technical

infrastructures.

20.00% Designing consulting of public works and technical

infrastructures.

25.50% Designing, consulting, constructing technical

infrastructures.

Transportation and Public Works One Member Co., Ltd. transformed into Transportation and Public Works JSC since 01 November 2015.

Transport Public Works Consultant One Member Co., Ltd. transformed into Transport Public Works Consultant Co., Ltd since 03 February 2015.

As at 14 December 2015, Water Design and Consultancy JSC issued additional shares, hence proportion of ownership and porportion of voting

right held by the Corporation is shifted from 51.00% to 25.50%.

16


2. ACCOUNTING SYSTEM AND ACCOUNTING POLICY

2.1 Accounting period and monetary currency unit

Annual accounting period commences from 1 st January and ended 31 st December. The Corporation maintains its accounting records in Vietnamese Dong (VND).

2.2 Accounting Standards and Accounting system

Accounting System

The Corporation applies Enterprise Accounting System issued under Circular No. 200/2014/TT-BTC dated 22 December 2014 by the Ministry of Finance.

Statement of compliance with Vietnamese standards and accounting system

The consolidated financial statements are prepared in accordance with Vietnamese Accounting Standards and supplemental documents issued by the State.

Form of accounting record

The company is applying accounting record by computer.

2.3 Changes in accounting policies and disclosures

On 22 December 2014, the Ministry of Finance issued Circular No. 200/2014 ITT-BTC guiding the enterprise accounting policy as replacement for Decision No. 15/2006/QD-BTC

dated 20 March 2006, and Circular 202/2014/TT-BIC guiding the preparation of consolidated

financial statements, will be effective for fiscal years commencing on or after 01 January 2015.

The effect of changes in accounting policies under the guidance of Circular No. 200/2014/TT-

BTC and Circular 202/2014/TT-BTC is applied prospectively recognized. The Corporation

has supplemented comparative disclosures relating to changes in accounting policies

between Circular 200/2014/TT-BTC and Decision 15/2006/QD-BTC in Notes 33 of the consolidated financial statements.

2.4 Basis for consolidation of financial statements

Consolidated financial statements are prepared based upon consolidating separate financial

statements of the Corporation and its subsidiaries under its control as at 31 December.

Control rights is in practice when the Corporation has power to govern the financial and

operating policies of invested companies to obtain benefits from their activities.

Financial statements of subsidiaries are prepared for the same fiscal year as the

Corporation, using consistent accounting policies. If necessary, financial statements of

subsidiaries may be adjusted to ensure the consistence between accounting policies applied at the Corporation and its subsidiaries.

Operation results of subsidiaries which were purchased or liquidated that leads to losing the Coporation's control in the period ,are presented on consolidated financial statements since the date of losing control.

Main balance, income and expense, including unrealized profits from inter-group transactions are eliminated in full from consolidated financial statements.

Non-controlling interest reflecting profits or losses and net assets which are not held by the

Corporation will be presented in a separate item on consolidated statement of financial position and consolidated statement of income.

17

1



2.5 Foreign currency transactions

Transactions in currencies other than accounting unit of the Corporation during the fiscal year are recorded at the actual rate of exchange ruling at the dates of transactions and are determined under the following principles:

- When buying or selling foreign currency: is exchange rates concluded in contracts of foreign exchange sale between the Corporation and commercial banks;

- When recording liabilities: is exchange rates of selling of commercial banks where the Corporation expect to conduct transactions at the time of incurred transactions;

Actual exchange rate upon re-determining accounts derived from foreign currencies at the date of the Consolidated financial statements is determined under the following principles:

For accounts derived from foreign currencies classifies as asset: apply exchange rates of purchase of commercial banks where the Corporation regularly conduct transaction;

For foreign currency deposited in bank: apply exchange rate of purchase of the bank

where the Corporation open foreign currency accounts;

- For accounts derived from foreign currencies classified as liabilities: apply exchange rates of selling foreign currency of commercial banks where the Corporation regularly conduct

transactions.

All exchange differences arising on settlement or revaluation at the balance sheet date shall

be recorded into the financial income or expense in the fiscal year.

Foreign exchange differences due to revaluation of year end balance of monetary items

denominated in foreign currencies are reflects in the balance sheet at 31/12/2014 was fully

transferred to the financial revenue in the consolidated financial statement at 31/12/2015

under Circular 200/2014/TT — BTC.

2.6 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, cash in banks and short-term, highly

liquid investments with an original maturity of less than three months that are readily

convertible into known amounts of cash and that are subject to an insignificant risk of

change in value.

2.7 Financial investments

Financial investments of the Corporation include: bank deposits with specific terms,

investments in subsidiaries, investments in associates and other long-term investments.

Bank deposits with specific terms are presented in the balance sheet at the date of financial

statement as follows:

- A cash equivalent in the event of term is less than 3 months.

- Short-term held to maturity in the event of term is from 3 to 12 months. - Long-term held to maturity in the event of term is more than 12 months.

Investments in associates: An associate is an entity over which the Corporation has

significant influence and that is neither a subsidiary nor an interest in a joint venture.

Significant influence is the power to participate in the financial and operating policy decisions

of the investee but not control or joint control over those policies. Investments in associated

companies are based on equity method in this consolidated financial statement.

..5

18


Other long-term investments are investments in other companies where the Corporation holds under 20% of owner's equity (less than 20% of voting power held).

2.8 Trade receivables

Trade receivables are carried at the original invoices, and other receivables less an estimate made for doubtful receivables based on management review of all outstanding amounts at the year end.

The provision for bad debts is made for each bad debts based on overdue period of debts or possible loss.

2.9 Inventories

Inventories are stated at the lower of cost and net realizable value. The costs of inventories comprise the purchase price, costs of conversion and other costs incurred in bringing the

inventories to their present location and condition.

At the year end, the value of inventories as equipment, supplies and spare-parts as a replacement in the event of damage but do not qualify for classification as fixed assets and

estimated time of provision of 12 months or more than a production cycle are presented as

Long-term equipment, supplies and spare-parts on the balance sheet.

The cost of inventory for production is calculated by weighted average method. The cost of

inventory for construction is calculated by direct method.

Inventory is recorded by perpetual method.

Provisions for devaluation of inventories made at the end of the year are the excess of

original cost of inventory over their net realizable value.

2.10Fixed assets

Fixed assets (tangible and intangible) are stated at the historical cost. During the using time,

fixed assets (tangible and intangible) are recorded at cost, accumulated depreciation and net book value.

The costs of fixed assets transferred from construction-in-progress (CIP) include all direct

costs attributable to bring the asset to the location and condition necessary for it to be

capable of operating in the manner intended by management (CIP expenditures paid to the

contractors, designation fee, capitalized interest expenses, supplies from the Corporation...).

Completed constructions shall be recorded as fixed assets at the point of time based on

handover for usage minutes. In case, the construction is completed but settlement process

has not yet been finished, historical cost of assets is recognized temporarily based on estimated value.

Depreciation/amortization is provided on a straight-line basis. Depreciation is recognized into

cost of production and business in the period, except for amortization of some intangible

fixed assets from Rural Ho Chi Minh City Water Supply Enterprise which is established by

non-business expenditure source. The estimated depreciation/amortization as follows:

- Buildings 4 - 25 years - Machine, equipment 4 - 15 years - Transportation equipment 5 - 30 years - Management equipment 2 - 10 years - Other fixed assets 2 - 25 years

19



- Management softwares

- Computer softwares

3 - 8 years 3 - 6 years

Fixed assets of land use right at Rural Ho Chi Minh City Water Supply Enterprise which is not

required to be amortized, details at Note 13.

2.11Construction in progress

Construction in progress is the direct costs incurred when implemented construction project purpose (include investment construction or overhaul, renovate, expand or retool technical

assets) necessary for production purpose. Costs are stated at original cost.

2.12Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production any qualifying assets during a substantial period of time that is required to complete for its

intended business purpose are capitalized in the cost of that asset.

All of other borrowing cost will be recorded as production costs in the Income statement

when it incurs.

2.13Prepaid expenses

Expenses related to the consolidated income statement in more than 01 accounting period

are recognised as prepaid expenses and are allocated into income statement of following

accounting periods.

Prepaid expenses incurred during the year but can benefit in more than 01 year since the

balance sheet date are recorded as long-term prepaid expenses and are amortised gradually

into the consolidated income statement. The calculation and allocation of long-term prepaid

expenses to operating costs in the period is based on nature of those expenses, straight-line

and on reasonable method/criteria basis. The policy for allocation of some major prepaid

expenses are as follows:

Replacement and new installation of water meters: In 2015, Cho Lon Water Supply JSC

("CLWS") incurred a significant amount of work. CLWS recorded these costs as prepaid

expenses and allocate in a period of 02 — 03 years. On the other hand, the Corporation and

other companies within the Corporation recorded all of those expenses as an operation

expense in the year it incurs. The difference between two methods of recognition resulted in

an amount of VND 59.9 billion which has not been recorded into expense of this period

(details at Note 9).

Goodwill: value of business advantages which were determined by the State authorities at

its equitization. The Corporation can allocate them into operation cost with a period of less

than 10 years.

2.14Accrued expenses

Accrued expenses are charged into operating costs on the basis of the matching principle

(between revenue and associated expenses). If there is any difference with the amount

charged and its actual occurrence, adjustment will be made toward the fair statement.

2.15Owner's equity

Owner's equity is stated at actually contributed capital of the Investors.

20

lo



Retained earnings are the profit of business operations after deduction (-) regulated items due to applying a change in accounting retrospectively or to make a retrospective restatement to correct materiality in previous years.

Undistributed profits of Parent Company and One Member Co., Ltd. shall complied with Decree No. 71/2013/ND-CP dated 11 July 2013 of the Government. Undistributed profits of

joint stock companies was determined according to the resolution of annual general meeting.

2.16Revenue

Sale of goods

Revenue from sale of goods should be recognized when all the following conditions have been satisfied:

- The entity has transferred to the buyer the significant risks and rewards of ownership of the goods;

- The entity retains neither continuing managerial involvement to the degree usually

associated with ownership nor effective control over the goods sold; The amount of revenue can be measured reliably;

It is probable that the economic benefits associated with the transaction will flow to the

entity; and

The cost incurred or to be incurred in respect of the transaction can be measured Lbt4G reliably.

Revenue from sales of pure water is recognized based on provided water measured by

water meter at the checking time (normally not at the year-end). P,

Revenue from setting up water meter and reconstructing site was recognized upon work completion as well as invoices issuance.

Rendering of services

When the outcome of a transaction involving the rendering of services can be estimated

reliably, revenue associated with the transaction shall be recognised by reference to the

stage of completion of the transaction at the end of reporting period. The outcome of a

transaction can be estimated reliably when all the following conditions are satisfied:

The amount of the revenue can be measured reliably; and

It is probable that the economic benefits associated with the transaction will flow to the entity; and

The stage of the completion of the transaction at the end of the reporting period can be measured reliably; and

The costs incurred for the transaction and the costs to complete the transaction can be measured reliably.

The revenue from services rendered is recorded based on the assessment of work-completed.

Financial income

Financial incomes includes income from interest and other financial gains earned by the

Corrporation should be recognized when these two conditions are satisfied:

It is probable that the economic benefits associated with the transaction will flow to the entity; and

The amount of the revenue can be measured reliably.

21

I

1 1

1



Dividends are recognized when the Company has the right to receive dividends from the

capital contribution.

Income from the liquidation of a state's capital invested into subsidiaries, which are regconized on the basis of received amount and the original cost of investments. This income is recorded into the Business Arrangement Assitance Fund.

2.17Financial income

Items recorded into financial expenses consist of:

- Expenses or losses relating to financial investment activities; and - Expenses of capital borrowing; and

- Loss due to foreign exchange differences arising from transactions relating to foreign

currencies.

The above items are recorded by the total amount arising within the period without compensation to financial revenue.

2.18Income tax

Current income tax

Current tax assets and liabilities for the current and prior periods are measured at the amount

expected to be recovered from or paid to the taxation authorities that is calculated by the tax

rate enacted at the balance sheet date and the taxable incomes.

Deferred income tax

Deferred tax is provided using the balance sheet liability method on temporary differences at

the balance sheet date between the tax base of assets and liabilities and their carrying

amount for consolidated financial reporting purpose. Deferred income tax assets and

liabilities are measured at the tax rate that are expected to apply in the year when the asset

realised or the liability is settled based on tax rate and tax laws that have been enacted at the

balance sheet date.

Other taxes

Other taxes are compliance with prevailing laws and regulations.

2.19Related parties

Related parties refer to party that posess the ability to control or own a significant influence

on the Corporation regarding of financial policies and operations. The Corporation's related

parties are as follows:

- Entities, individuals, directly or indirectly through one or more intermediaries, having

control over the Corporation or being under the control of the Corporation, or being

under common control with the Corporation, including the Corporation's parent,

subsidiaries and associates;

- Individuals, directly or indirectly, holding voting power of the Corporation that have a

significant influence on the Corporation, key management personnel including directors

and employees of the Corporation, the close family members of these individuals or

affiliated parties or companies associated with these individuals;

Corporations or companies which directly or indirectly owned by these individuals or

having a significant proporition of voting right held on the Corporation.

22


In considering the relationship of related parties, its nature should also be considered, not only the legal form of the relationship.

3. Cash and cash equivalents

31/12/2015 01/01/2015

VND VND

Cash on hand 2,554,643,662 1,673,039,866 Cash in bank 326,782,748,401 317,858,840,994

Cash equivalents (*) 432,101,556,337 462,532,110,554

761,438,948,400 782,063,991,414

(*) Cash equivalents are saving accounts at banks with maturity from 01 to 03 months.

4. Short-term trade receivables

31/12/2015 01/01/2015

VND VND

Customers purchase goods, supplies 5,476,159,864 16,386,721,366 Construction (i) 1,341,618,096 258,689,044,454

Water supply 33,266,053,949 23,088,531,637 Construction consultancy 9,179,049,771 Others 3,242,210,891 5,096,365,949

43,326,042,800 312,439,713,177

(i) Opening balance include the receivables at Transportation and Public Works One Member Co., Ltd.

5. Advances to suppliers

31/12/2015 01/01/2015

VND VND

a) Short-term 204,699,492,007 88,878,094,830 Civil work contractor 180,156,050,777 62,998,952,557 Material supplier, other suppliers 23,547,701,712 22,198,017,657 Overhaul contractor 1,720,632,858 Purchase of fixed assets 82,250,000 120,000,000 Construction design 617,068,488 Others 913,489,518 1,223,423,270

b) Long-term 16,158,472,598 16,158,472,598 Civil work contractor 15,909,698,118 15,909,698,118 Material supplier, other suppliers 248,774,480 248,774,480

220,857,964,605 88,878,094,830

23

NM NMI • MD MI OM MIS NM NM— 1•111 MI MI NEI MI MI MO MN MI 1111111 Mall


Consolidated Financial Statements No. 01 Gong Truong Quoc Te, District 3, Ho Chi Minh City

For the year ended 31/12/2015

6. Others receivables

31/12/2015 1/1/2015

Book value Provision Book value Provision

VND VND VND

a) Short-term 56,066,468,710 - 342,426,611,349

Receivables from construction's team of Transportation and Public - - 155,171,987,282

Works JSC (i)

Interests on term deposits 12,361,129,196 17,949,433,962

Receivables from dividends 9,293,191,797 6,715,500,000

Receivables from Construction Corporation No.1 2,680,222,000 4,680,222,000

Advances (i) 1,429,888,498 126,400,896,993

Collateral 2,111,119,897 4,902,008,857

Others 28,190,917,322 26,606,562,255

b) Long-term 59,636,589,540 29,379,307,537

Receivables from Transportation and Public Works JSC (ii) 38,450,762,825

Received liabilities from Saigon River Water Exploiting Investment 7,996,457,784 8,017,975,920

Company (iii)

Collateral 1,908,323,830 1,228,993,010

Receivables from cash shortage 1,157,969,085 1,157,969,085

Advances 291,905,014 374,352,840

Others 9,831,171,002 18,600,016,682

115,703,058,250 - 371,805,918,886

(i) Beginning balance at Transportation and Public Works One Member Co., Ltd includes the intercompany balance between the Corporation's

Head Office and its own construction units (there is no accounting unit for these units, it is managed and responsible by construction's team

leaders).

(ii) The Corporations's receivables are payments on behalf of Transportation and Public Works JSC (formerly known as Transportation and Public

Works One Member Co., Ltd.)

(iii) These receivables will be adjusted upon finalization as the Corporation has not agreed with the Decision No. 6704/QD-UBND dated 28

December 2012 of Ho Chi Minh City's People Committee regarding the finalization for the project.

24

Sal Gon Water Corporation — One Member Limited No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City


7. Shortage of assets awaiting for resolution

31/12/2015 01/01/2015 VND VND

Cash shortage awaiting for resolution (*) 6,680,788,594 6,680,738,598 Materials shortage from counting 494,337,718 Materials shortage awaiting for resolution 111,763,489 111,763,488 PMU - 1273

6,792,552,083 7,286,839,804

(*) Cash shortage found from the cash count in 2003 at the Corporation's Head Office, which

has been fully provisioned (Note 8).

8. Provisions for short-term bad debts

31/12/2015 01/01/2015

Provision for doubtful water charges

Provision for cash shortage awaiting for

resolution (Note 7)

Provision for overdue receivables

VND

11,636,349,687

6,680,738,599

322,397,179

VND

10,248,851,528

6,680,738,598

322,397,179

18,639,485,465 17,251,987,305

9. Prepaid expenses

31/12/2015 01/01/2015

VND VND

Short-term 15,329,700,133 12,533,712,670 Life insurance 11,763,800,000 8,422,578,082 Tools and instruments awaiting for allocation 1,793,375,450 788,112,748 Cost of fixing tanks and water meters. 1,335,561,546 Others 436,963,137 3,323,021,840

Long-term 104,024,565,702 16,564,542,646 Overhaul of fixed assets (*) 36,532,161,726 5,871,585,025 Tools and instruments awaiting for allocation 2,965,397,531 6,265,953,376 Replace and set up water meters according to 59,944,451,555 - Circular 117 at Cho Lon Water supply JSC (**)

The residual value of assets adjusted

according to Circular 45/2013/TT-BTC 353,371,968

Goodwill 3,133,974,427 2,924,244,975 Increasing in value of tools and instruments

adjusted when equitization. 530,238,831 795,358,251

Others 918,341,632 344,029,051

119,354,265,835 29,088,255,316

(*) More information at Note 28.

(**) More information at Note 2.13

1

25

WON NOB IMP it MO MN MI MO IMP 1•111 ill VIA NUM MEI MR 1111 811111 MO NM


Consolidated Financial Statements No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City


10. Bad debts

31/12/2015 01/01/2015

Historical

value

Recoverable

value

Historical Recoverable

value value

Receivables, debts that are overdue or not overdue but hard

to recover

VND VND VND VND

- Trade receivables overdue payment for water bills at JSC 7,792,773,041 5,714,979,320 6,956,649,544 5,312,624,084

- Shortage of assets awaiting resolution at the Corporation's

head office 6,680,738,599 6,680,738,599

- Shortage of cash awaiting for resolution at Ben Thanh 1,157,969,085 1,157,969,085

Water supply JSC (i)

15,631,480,725 5,714,979,320 14,795,357,228 5,312,624,084

(i) The remaining receivable balance related to embezzled amount of Mr. Le Trung Huy in July 2013 at Ben Thanh Water Supply JSC.

11. Inventory and long-term equipment, supplies and spare-parts

31/12/2015 01/01/2015

Cost Provision Cost Provision

VND VND VND VND

Raw materials 143,924,971,768 33,835,666 258,762,178,626 37,186,851

Tools, supplies 2,045,777,751 1,346,251,739

Work in progress 10,148,394,672 12,165,337,421

Finished goods 135,539,334 470,144,133

Merchandise 152,161,208 636,090,805

Inventories 156,406,844,733 33,835,666 273,380,002,724 37,186,851

Long-term equipment, supplies and spare-parts (ii) 206,852,197,893 272,285,219,996

(ii) Long-term equipment, supplies and spare-parts refer to specific supplies for reservation of units under the Corporation.

26

ME M = NM NM • MIM E= INN MO • • • • NM MN • MO IM


No. 01 Gong Truong Quoc Te, District 3, Ho Chi Minh City Consolidated Financial Statements


12. Tangible fixed assets

Buildings

Machinery

equipment

Transportation

equipment

Management

equipment Others Total VND VND VND VND VND VND

Historical cost

As at 01/01/2015 1,212,672,469,454 874,201,130,575 8,105,704,778,148 652,631,244,617 2,693,124,902 10,847,902,747,696

Increase 118,642,861,604 75,028,046,879 1,220,553,964,347 173,083,791,532 209,973,039 1,587,518,637,401 Purchase in the year 46,188,461,005 65,477,680,665 11, 776,816,700 209,973,039 123,652,931,409 Handling on Binh Hung sub-

water system 57,807,696,043 5, 861,272, 901 37,310,525,168 1,216,997,308 102,196,491,420

Finished CIP 60,835,165,561 22,940,014,138 1,117,465,469,883 158,787,373,754 1,360,028,023,336 Settlement upon finalization 300,288,631 300,288,631 Revaluation of assets when

equitization 38,298,835 38,298,835

Others 1,302,603,770 1,302,603, 770

Decrease 14,785,344,608 11,253,282,708 37,361,186,234 1,735,529,207 90,823,424 65,226,166,181 Liquidating, disposal 3,464,358,498 2,013,454,665 11,280,702,961 237,612,400 90,823,424 17,086,951,948 Rural HCM Water Supply 3,308, 562, 850 974,286,986 6,387,932,409 10,670,782,245 Enterprise handed over 7

water supplies at Cu Chi

dist. for Saigon Water

Infastructure JSC

Adjustment after temporarily

increase the value of assets

at Can Gio factory

127,635,146 9,493,416 3,998,777,942 4,135,906,504

Reclassification into

investment properties

2,259,572,500 2,259,572,500

Settlement upon finalization 1,981,800,110 1,981,800,110 Revaluation of assets when

equitization

840,020,347 25,592,144 74,494,353 940,106,844

Dismantling, relocating

assets

9,200,454,173 9,200,454,173

Transform into associated

companies

4,785,195,267 7,959,947,641 4,383,492,711 1,094,937,550 18,223,573,169

Others 296,100,000 102,433,784 328,484,904 - 727,018,688

As at 31/12/2015 1,316,529,986,450 937,975,894,746 9,288,897,556,261 823,979,506,942. 2,812,274,517 12,370,195,218,916

27

IIIII NM MI- NM MI MIMI IIIIII MO MN MN MN MN • 11110 OM MI




12. Tangible fixed assets (continued)

Buildings

Machinery

equipment

Transportation

equipment

Management

equipment Others Total

Accummulated depreciation

VND VND VND VND VND VND

As at 01/01/2015 802,505,228,715 669,849,972,148 4,833,939,964,615 121,674,964,462 2,654,658,053 6,430,624,787,993

Increase 67,920,936,622 58,510,343,822 594,234,048,959 101,061,591,292 16,564,365 821,743,485,060

Depreciation for the year 67,403,724,005 58,473,499,532 594,234,048,959 101,011,208,058 16,564,365 821,139,044,919

Revaluation of assets when

equitization

36,844,290 36,844,290

Other 517,212,617 50,383,234 567,595,851

Decrease 12,077,011,922 10,935,221,868 21,342,753,380 1,872,290,749 90,823,424 46,318,101,343

Liquidating, disposes 1,645,216,733 2,012,263,000 7,036,589,179 237,612,400 90,823,424 11,022,504,736

Rural HCM Water Supply 1,648,758,370 400,310,767 3,394,468,448 5,443,537,585

Enterprise hand over 7 water

supplies at Cu Chi area for

Saigon Water Infastructure

JSC

Reclassification into

in estment properties

1,835,974,527 1,835,974,527

Dismantling, relocating

assets

5,871,907,499 5,871,907,499

Revaluation of assets when

equitization

1,224,486,838 628,570,008 1,355,099,886 457,745,331 3,665,902,063

Transform into associated

companies

4,369,619,642 7,877,468,093 3,274,773,551 1,072,408,755 16,594,270,041

Other 1,352,955,812 16,610,000 409,914,817 104,524,263 1,884,004,892

As at 31/12/2015 858,349,153,415 717,425,094,102 5,406,831,260,194 220,864,265,005 2,580,398,994 7,206,050,171,710

In which:

- Historical cost of fully depreciated fixed assets still in use at as 31 December 2015: VND 3,328,413,257,523 Assets from "Sai Gon Water Supply System Phase I" amounting VND 909,509,169,342 have not been_adjusted in accordance with the finalization

. value under Decision No. 6704/QD-UBND dated 28 December 2012 of Ho Chi Minh City's People Committee.

7:■3 - >•• ■

•C"-

28

Sal Gon Water Corporation — One Member Limited

Consolidated Financial Statements No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City For the year ended 31/12/2015

13. Intangible fixed assets

Land use right (*) Computer software Total

Historical cost

VND VND VND

As at 01/01/2015 174,891,889,949 51,655,204,851 226,547,094,800

increase 11,754,022,090 11,754,022,090 Purchase in the year 10,964,272,090 10,964,272,090 Handling on Binh Hung

sub-water system 789,750,000 789,750,000

Decrease 129,914,083,736 386,585,920 130,300,669,656 Subsidiaries transformed

into associates

128,029,834,136 386,585,920 128,416,420,056

Rural HCM Water Supply 1,884,249,600 1,884,249,600 Enterprise handed over 7

water supplies at Cu Chi

area

As at 31/12/2015 44,977,806,213 63,022,641,021 108,000,447,234

Accumulated amortization

As at 01/01/2015 6,215,205,246 32,115,350,360 38,330,555,606

Increase 416,472,453 11,035,103,597 11,451,576,050 Amortization for the year 11,035,103,597 11,035,103,597

Others adjustments 416,472,453 416,472,453

Decrease 6,207,045,246 386,585,920 6,593,631,166 Subsidiaries transformed

into associates 6,207,045,246 386,585,920 6,593,631,166

As at 31/12/2015 424,632,453 42,763,868,037 43,188,500,490

Net carrying amount

As at 01/01/2015 168,676,684,703 19,539,854,491 188,216,539,194

As at 31/12/2015 (*) 44,553,173,760 20,258,772,984 64,811,946,744

(*) Land for office buildings and rural water supply stations were given to Rural Ho Chi Minh Water Supply Enterprise under the Corporation.

Historical cost was recorded on the basis of site clearance compensation amount which is

announced by Ho Chi Minh Department of Finance and Department of Natural Resources

and Environment. Land use right is formed from budget sources and not required to be

amortized since the Corporation has not issued any Land use rights to Rural Ho Chi Minh Water Supply Enterprise.

29

1


14. Construction in progress

31/12/2015 01/01/2015

VND VND

Construction in progress 1,004,020,678,184 1,058,180,782,809

In which, some main projects are:

- Saigon Water Supply System Phase I (i) 66,660,336,542 66,660,336,542

- Cean water pipeline segment on D2400 115,957,821,105

Thu Duc

- Kenh Dong Water Supply Network level 2

project 90,376,870,777

- Water Supply Network level 1,2 project at 60,880,410,812

Thu Duc

- Ho Chi Minh City reduction of non-

revenue water project (ii)

26,097,509,165 102,151,977,744

- Reduction of non-revenue water; 46,226,918,413 13,894,350,415

Strengthening and Expansion of water

supply network and institutional

strengthening for Saigon Water

Corporation (Phase 2011 — 2015) (iii)

- Received construction in progress from 77,417,430,026 77,417,430,026

Project ADB - 1273 (iv)

- Relocate the water supply system in

areas of project construction of urban

railway

40,789,877,643 39,097,586,156

- Compensation for land to construct Thu 22,109,570,144 22,099,047,844

Duc Water Treatment Plant with capacity of

300,000m3/day (v)

Sai Gon Clean Water Business and 1,169,190,122,191 590,327,269,839

Investment JSC - Thuduc Water

Company Renovation Phase 3 (vi)

Other constructions in progress in

other companies 103,132,503,374 163,182,036,656

)

2,276,343,303,749 1,811,690,089,304

(i) Construction in progress of the project "Sai Gon Water Supply System Phase l" has not ,*/ been adjusted according to Decision No. 6704/QB-UBND dated 28 December 2012 of./

Ho Chi Minh City's People Committee.

(ii) Project funded by the World Bank under Loan Agreement No. 4028-VN dated 15 March 2007. The project has been completed and awaiting for finalization.

(iii) Project funded by the Asian Development Bank, Loan Agreement No. 2754-VN dated 08 June 2011.

(iv) Settlement upon finalization.

(v) Project implementing time ended in 2012 and the Corporation is waiting for Ho Chi Minh City's People Committee to approve for extension.

(vi) Thu Duc Water Treatment Plant 3 started operating and supplying water for the Corporation from January 2016.

30

MIII MB NMI =II 111111 III•1 11= • MID I•111 111111 r OM Mil MI MN •




15. Financial investments

31/12/2015

Historical value

VND

01/01/2015

Historical value Book value

VND VND

Book value

VND

a) Held to maturity

Short-term investment - Term deposits

638,808,659,508

638,808,659,508 634,570,015,018

634,570,015,018 Long-term investment - Term deposits

19,008,330,000

19,008,330,000 73,508,330,000

73,508,330,000

657,816,989,508 657,816,989,508 708,078,345,018 708,078,345,018

31/12/2015 1/1/2015

Book Value Fair Value Provision Book Value Fair Value Provision VND VND VND VND VND VND

b) Investments into associates 202,211,700,000 215,132,320,730 111,208,200,000 121,356,322,997 Transportation and Public Works 67,187,500,000 67,784,239,050 JSC

Transport Public Works 500,000,000 511,685,944

Consultant JSC

Water Design and Consultancy JSC 816,000,000 816,000,000

Water Supply Works and 2,458,200,000 4,559,867,305 2,458,200,000 4,110,001,311

Mechanical JSC

Inter Square Commercial Service 90,000,000,000 100,174,984,949 90,000,000,000 98,496,321,686

JSC

Tan Hiep Water Investment JSC 41,250,000,000 41,285,543,482 18,750,000,000 18,750,000,000

c) Other long-term investment 72,600,000,000 72,600,000,000 72,600,000,000 72,600,000,000 Kenh Dong Water Supply JSC (*) 72,600,000,000 72,600,000,000 72,600,000,000 72,600,000,000

274,811,700,000 287,732,320,730 183,808,200,000 193,956,322,997

The fair value of investments into associates is determined by the equity method which is stated on associate's financial statement at the date of the Coporation's Consolidated financial statements. Detailed information of the Corporation's associates as at 31/12/2015 is presented in Note 1.

(*) Investments into Kenh Dong Water Supply JSC with proportion of ownership of the Corporation is 18.15%. The fair value of this long-term

investment is recorded on the basis of historical cost since there is no specific guidance regarding of fair value's determination according to Vietnamese Accounting Standards as well as Vietnamese Enterprise Accounting System.

31

INN IMR • MI MB OM =II 11111 1111111 11111111 11•11 Ma ION M1011 al


Consolidated Financial Statements No. 01 Gong Truong Quoc Te, District 3, Ho Chi Minh City


16. Trade payables

31/12/201 5 01/01/2015

Book value Liquidity Book value Liquidity

VND VND VND VND

a) Short-term payables 646,851,936,277 646,851,936,277 388,310,163,366 388,310,163,366

Material supplier 52,541,930,185 52,541,930,185 42,560,463,301 42,560,463,301

Civil work contractors (*) 505,453,618,607 505,453,618,607 252,972,722,725 252,972,722,725

Pure water 70,345,907,443 70,345,907,443 71,342,781,187 71,342,781,187

Others 18,510,480,042 18,510,480,042 21,434,196,153 21,434,196,153

b) Long term payables 272,032,141,652 272,032,141,652 193,162,686,698 193,162,686,698

Civil work contractors (*) 272,005,784,076 272,005,784,076 193,136,329,122 193,136,329,122

Others 26,357,576 26,357,576 26,357,576 26,357,576

394,919,979,280 685,462,600,974 307,065,931,186 500,228,617,884

(*) Including payable to Kenh Dong Water Supply JSC ("party B") regarding the investment value for Tan Hiep — An Suong — Tay Thanh pure water

pipeline according to Contract No. 5551/HDDT-TCT-HTKTTH and its appendices. The first principle payment is VND 191,803,000,000 (Minute dated

31/12/2013) and the second payment is VND 168,830,173,427 (Minute dated 31112/2015).

The first principle is VND 191,803,000,000 — two parties have an agreement on debt repayment which is stated in an appendix of Contract No.

4668/PLHD-TCT-HTPT dated 31/12/2013. Accordingly, the Corporation will make a principle payment for party B within 51 months since the date of handing over project on 25110/2013. Simultaneously, interest will be paid monthly at the rate of 7.8% per annum and calculated on decreasing

balance.

The second principle is VND 168,830,173,427— plan for debt repayment is yet to finalize at the date of report.

Payable balance (short-term and long-term) as at 31/12/2014 and 31/12/2015 is: VND 117,718,218,363 and VND 227,672,403,874, respectively.

32

11•11 MI ION MI Mt MI • MI MIN MID MI =II NMI MO NMI • • • ION WI




17. Tax payables and statutory obligations

Opening balance Arise in the year Closing balance

Receivables Payables Payables Actually paid Adjustment (i) Receivables Payables

VND VND VND VND VND VND VND

Valued added tax 3,481,183,861 12,015,856,844 95,982,981,751 94,085,752,453 (9,799,392,715) 1,567,532,756 2,200,042,322

Corporate income

tax

52,351,029 77,597,790,577 69,729,831,712 109,100,624,993 (3,107,853,491) 1,980,065,463 37,046,858,239

Personal income

tax

3,950,768,244 202,258,726 12,066,959,483 12,833,783,004 308,274,706 4,427,606,380 220,548,047

Natural resource

tax

1,569,259,548 22,639,486,907 15,316,891,596 8,891,854,859

Land tax and land

rental

2,319,009,789 9,865,770,421 9,865,770,421 (1,398,234,800) 920,774,989

Other taxes 1,000,000 11,758,408,158 132,632,472,004 129,779,107,172 1,000,000 14,611,772,990

Other fees 32,373,167,195 230,522,090,427 234,709,657,052 28,185,600,570

Paid to the State (ii) 53,895,373,422 69,246,480,644 53,895,373,422 69,246,480,644

Others 332,660 332,660

7,485,303,134 191,731,456,919 642,686,073,349 659,586,960,113 (13,997,206,300) 7,976,204,599 161,324,265,320

(i) Adjustments of balance of subsidiaries which was transformed into associates.

(ii) Payable to the State refers to retained earnings of the Corporation.

The Corporation's tax settlements are subject to examination by the tax authorities. Because the application of tax laws and regulations on many types of transactions is susceptible to varying interpretations, amounts reported in the financial statements could be changed at a later date upon final

determination by the tax authorities.

33



18. Short-term advances from customers

31/12/2015 01/01/2015 VND VND

Construction (*) 8,411,268,478 78,749,206,201 Overhaul 896,261,505 Pure water 3,222,216,671 4,770,319,731 Construction consultancy 246,254,262 Others 6,687,670,440 12,183,813,615

18,321,155,589 96,845,855,314

19. Accrued short-term expenses

31/12/2015 01/01/2015

VND VND

Estimated cost of construction (*) 35,383,747,148 267,361,566,154 Accrual cost for development and repair of

water supply network, water meter 29,071,416,503 26,067,613,800

Accrued interest expenses 473,562,661 Others 3,521,964,469 1,973,018,324

67,977,128,120 295,875,760,939

1

.351

oaJ

-0\\\

BOA

.1, (*) Beginning balance includes the balances at Transportation and Public Works One F,\'\C)

Member Co., Ltd.

20. Other short-term payables

31/12/2015 01/01/2015

VND VND

State fund of Sai Gon River Water Supply 102,870,612,674 102,870,612,674 Network Project Phase 1 (i)

Payable to Inter Square Commercial Service 84,000,000,000 84,000,000,000 JSC (ii)

Payable to internal units for construction

expenses - Transportation and Public Works - 115,459,368,882

Co., Ltd (iii)

Fund received of compensation, relocation,

site clearance works - 28,340,220,562

Interest payables 11,277,344,976 8,302,330,212 Unrecorded ADB funds (iv) 22,552,101,130 Others 46,889,637,624 51,448,766,204

267,589,696,404 390,421,298,534

(i) Funded by the State budget for implementing Sai Gon River Water Supply Network

Project — Phase 1 which have not been adjusted in accordance with the settlement of

Decision No. 6704/QD-UBND dated 28 December 2012 by Ho Chi Minh City's People Committee.

34


(ii) Interest-free for financial support from Inter Square JSC, in accordance with Contract

No. 06/2014/HD-HTV-QTQT dated 25/03/2014. Renewal of debt is made every two month in 2015.

(iii) Beginning balance of the period refers to payables for implementing costs at Transportation and Public Works One Member Co., Ltd.

(iv) Fund received from the ADB (ADB project), which has not been recorded by the Ministry of Finance.

21. Other long-term payables

31/12/2015 01/01/2015

VND VND

IRelocation projects: 145,014,047,205 179,178,111,035

+ Ba Bo's Canal renovating PMU 1,273,802,276 13,410,369,152

+ Ho Chi Minh City Infrastructure Investment 11,358,284,747 22,838,430,783

+ Pipeline at Le Loi street (v) 68,149,762,950 68,149,762,950

+ Hanoi Highway - 35,647,220,696

I+ East-West Network (vi) 15,539,284,641 15,539,284,641

+ Project construction of drainage system on - 13,225,920,979

Do Xuan Hop street

+ My Thuan bridge - Phu Dinh station 34,115,194,423

+ Phan Van Try street 11,833,703,000

+ Other projects 2,744,015,168 10,367,121,834

IPaid to the State regarding land rental fees of 54,928,135,457 54,928,135,457

Transportation and Public Works JSC (vii)

Advances from State Budget for site 17,398,560,403 17,398,560,403

Iclearance compensation (vii)

Loans with free interest (viii) 22,006,842,532 21,152,569,841

Saigon River Water Exploiting Invesment 4,576,297,956 4,576,297,956

Liabilities from ADB-1273 Project (x) 5,243,870,662 5,243,870,662 Others 9,103,091,715 21,759,769,541

I 258,270,845,930 304,237,314,895

(v) Works are expected to be completed in 2016.

(vi) The remaining amount from site clearance compensation of East — West Highway

project will be recorded into other income upon finalization (the received amount from

this compensation is already recorded as an adjustment of the State Audit).

(vii) Capital for building water distribution network projects for Can Gio district received from

the Department of Finance. This amount will be settled upon completion approval of completed projects..

(viii) Advances from customers without interest for Cho Lon Water Supply JSC with the

purpose of investment in pipeline level 3. Time of repayment was stated at 10 years.

(ix) Liabilities have not been adjusted in accordance with the settlement of Decision No.

6704/QD-UBND dated 28 December 2012 by Ho Chi Minh City's People Committee.

(x) Liabilities settlement upon finalization.

1 35

OM MN i 11111 - MI I I I I I I MR MI MO is MI • 1I•1 • 111111111 NM • MO


22. Loans and liabilities

01/01/2015 Year 2015 31/12/2015

Book value Liquidity Increase Decrease Book value Liquidity


a) Short term loans 49,649,969,251 13,200,000,000 49,649,969,251 13,200,000,000 13,200,000,000

Sai Gon Clean Water

Business and Investment

JSC

Agribank - 13,200,000,000 13,200,000,000 13,200,000,000

Transportation and Public

Works JSC (*)

- Military Bank - 24,703,194,315 24,703,194,315

North Sai Gon Branch

- BIDV - Ho Chi Minh Branch 22,488,322,936 22,488,322,936

Other loans 2,458,452,000 2,458,452,000

b) Loans to maturity 206,946,008,845 206,946,008,845 271,497,052,579 200,378,166,245 278,064,895,179 278,064,895,179

Thu Duc Water supply JSC

- Agribank - Cho Lon Branch 797,430,000 797,430,000 797,430,000

Sai Gon Clean Water


JSC

- Vietinbank 35,215,000,000 35,215,000,000 35,215,000,000

- AKA Ausfuhrkredit 28,473,035,580 28,473,035,580 61,401,852,590 21,905,192,980 67,969,695,190 67,969,695,190

Gesellschaft mbH

(*) Adjusted when the subsidiaries transformed into associated companies.

36

MN IMP BNB MI • MIN ION MI= NIB MR INN MI In Mt — WIN Ili 11•11


Consolidated Financial Statements No. 01 Cong Twang Quoc Te, District 3, Ho Chi Minh City


22. Loans and liabilities (continued)

b) Loans to maturity (cont)

Coporation's head-office

01/01/2015 Year 2015 31/12/2015



- BIDV - Ho Chi Minh Branch 34,617,490,206 34,617,490,206 34,617,490,206 34,617,490,206 34,617,490,206 34,617,490,206 (Loan No. 1273)

- VDB - Transaction office II 33,540,000,000 33,540,000,000 33,203,272,333 33,540,000,000 33,203,272,333 33,203,272,333 - Ho Chi Minh City Finance

and Investment state-owned 77,265,872,779 77,265,872,779 49,111,797,743 77,265,872,779 49,111,797,743 49,111,797,743 Company

- VBD - Transaction office II

(Loan No. 4028) 33,049,610,280 33,049,610,280 33,936,000,000 33,049,610,280 33,936,000,000 33,936,000,000

- ACB - Tran Khai Nguyen 2,199,591,000 2,199,591,000 2,199,591,000 Branch

- Military Bank - North Sai 20,263,600,707 20,263,600,707 20,263,600,707 Gon Branch

- Agribank - Cho Lon Branch 751,018,000 751,018,000 751,018,000

256,595,978,096 206,946,008,845 284,697,052,579 260,028,135,496 291,264,895,179 291,264,895,179

37

ov a

ION NM MEI INN IIIIII MO Mil MO INS IMP OM INN ONE NM MI MIN MIN NM -



No. 01 Gong Truong Quoc Te, District 3, Ho Chi Minh City



01/01/2015 Year 2015 31/12/2015



c) Long-term loans 1,475,413,528,140 1,475,413,528,140 841,814,354,109 200,378,166,245 2,116,849,716,004 2,116,849,716,004

Thu Duc Water supply JSC

- Agribank - Cho Lon Branch 28,707,727,425 28,707,727,425 28,707,727,425

Sai Gon Clean Water


JSC

- Vietinbank 328,230,174,945 328,230,174,945 105,878,283,592 434,108,458,537 434,108,458,537

- AKA Ausfuhrkredit 139,394,197,181 139,394,197,181 309,812,517,461 21,905,192,980 427,301,521,662 427,301,521,662

Gesellschaft mbH

38

/0 ti

I= OM NM MIN NM NM MN MN MN NM I= OM MN • NM MO MN






c) Long-term loans (cont)

Coporation's head-office

01/01/2015 Year 2015 31/12/2015



- BIDV - Ho Chi Minh Branch 344,580,239,733 344,580,239,733 34,617,490,206 309,962,749,527 309,962,749,527

(Loan No. 1273)

- VDB - Transaction office II 66,743,272,333 66,743,272,333 33,540,000,000 33,203,272,333 33,203,272,333

- Ho Chi Minh City Finance

and Investment state-owned

159,928,669,780 159,928,669,780 15,070,099,153 77,265,872,779 97,732,896,154 97,732,896,154

Company

- BIDV Vietnam - Ho Chi 30,182,703,230 30,182,703,230 34,219,048,829 64,401,752,059 64,401,752,059

Minh Branch

- VBD - Transaction office 11 406,354,270,938 406,354,270,938 33,049,610,280 373,304,660,658 373,304,660,658

(Loan No. 4028)

- ACB - Tran Khai Nguyen 141,536,837,279 141,536,837,279 141,536,837,279

Branch

- Military Bank - North Sai 172,925,061,266 172,925,061,266 172,925,061,266

Gon Branch

- Agribank - Cho Lon Branch 33,664,779,104 33,664,779,104 33,664,779,104

1,475,413,528,140 1,475,413,528,140 841,814,354,109 200,378,166,245 2,116,849,716,004 2,116,849,716,004

Maturity within next 12

months (206,946,008,845) (206,946,008,845) (278,064,895,179) (278,064,895,179)

Maturity after 12 months 1,268,467,519,295 1,268,467,519,295 1,838,784,820,825 1,838,784,820,825

39

J(71 *

MINIM= SEIM MIMI 11111111111111•111•MINI 111111111011111111111



22. Short-term loans and liabilities (continued)

Details information related to loans:



Agreement/

No. Bank

Contract

Purpose

Maturity

Time of principle Interest rate payment Colleteral

. .

10 years (grace 5.5% - 7.8%

period of 1 year)

Loans atil'hu DucWiteiSUpPly JSC7: 1 Agribank - 6220-LAV-

Cho Lon 201501035 Branch dated

16/11/2015

Loans at S'aigonClean Water Business and 2

BIDV — Cho 6220-LAV- Lon Branch 201500768

dated 12/08/2015

Developing and investing in Water supply network

Investment JSC Additional working capital

Based on each debt acknowledgment contract




Collateral assets are assets formed from this loan at 31/12/2015: VND 28,982,881,997

Part of the right to collect the money from selling pure water

3 Vietinbank

4 AKA

Ausfuhrkredit Gesellschaft mbH (Frankfurt, Germany)

13.112301/HD TDH dated 10/5/2013

6/01430/10826 dated 02/08/2013

Project extension of Thu Duc Water Treatment Plant —Phase 3

Project extension of Thu Duc Water Treatment Plant — Phase 3

10 years Saving interest rate for the term of 12 month plus the amplitude of 2.5%

Total of the amplitude and refer interest rate are applied for loans in USD


After 6 month since the commencement

date

Assets formed in the future

40

• IIIIII MI MI- MEI SIM INNI 111111 MO NMI MI IMP MIN MI IIII•1

Sai Gory Water Corporation — One Member Limited

Consolidated Financial Statements No'. 01 Gong Truong Quoc Te, District 3, Ho Chi Minh City


Agreement/ No. Bank

Contract

Purpose

Maturity Time of principle

Interest rate payment Colleteral

Loans at the COrporation's Head Office 5 HCMC People VIE1273 dated

Comittee— Sub 28/12/1994 loan agreement 1273

Renovating and upgrading Ho Chi Minh City's water supply system project

25 years (grace 6.7% - 7% period of 5 years)

Principle and interest are paid at 20th Feb and 20th Aug annually

Assets formed from this loan

6 VDB —

8 loan

Invest in 08 Western

12 years

6.6%

At the end of

Assets formed from Transaction

contracts

water supplies

each month

this loan office II

(Western water supply level 1,2 & 3)

Ho Chi Minh city Finance and Investment

7 state-owned Company

Contract No. 21 dated 31/01/2008

Contract No. 75 dated 15/5/2008

Invest in Kenh Dong Water Supply Network level 2 project Invest in water supply network level 1,2 project at Thu Duc Dist.

Reduction of non-revenue water; Strengthening and Expansion of water supply network and institutional strengthening for Saigon Water Corporation (Phase 2011 — 2015) project ("ADB unit")

10 years

1.8% (grace period of 2.5 years)

25 years (grace Pending period of 5 years)

15th of March, June, September

and December

Pending

No requirement

Assets formed in the future

8 BIDV — HCMC 2754-VIE Branch dated

08/6/2011

41

MUM INN MI UM MI s NMI 1111I EN all an IM NO OM UM WEI MI IMO IN


No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City Consolidated Financial Statements


Agreement/ No. Bank Contract Purpose Maturity Interest rate

9 World Bank (Loan No .

4028-VN dated 15/3/2007

UWSDP 20 years (grace period of 5 years)

5.4%

4028)

10 ACB - Tran NGT.DN.254,0 Invest in projects of 10 years (grace 7.8% Khai Nguyen Branch

40215 dated 01/4/2015

Developing pipeline level 3 of Thu Duc

period of 1 year)

Water Supply JSC and Cho Lon Water Supply JSC (41 projects)

11 Military Bank- 184.15.201.17 Invest in developing 10 years (grace 7.8% North Sai Gon Branch

65492.TD dated

pipeline level 3 from 2014 to 2015 at

period of 1 year

20/4/2015 District 12 and Hooc Mon District (40 projects)

12 Agribank - 6220-LAV- Developing pipeline 10 years (grace 7 . 8%

Cho Lon 201500975/HO level 3 from 2015 — period of 1 year Branch TD dated 2016 (39 projects)

28/10/2015

Time of principle

payment

Colleteral

l st of June and

Assets formed in the 1 stof December

future annually

Based on each

Assets formed in the debt

future - acknowledgment

Transportation contract

pipeline level 3 equivalents to VND

403,000,000,000 of Saigon Water

Corporation - One

Member Limited.

Based on each

Entirely pipeline debt

systems, equipment, acknowledgment

the right to exploit contract

assets and benefit that are formed from

this loan, total amount of VND

436,344,000,000

Based on each

Assets formed in the debt

future acknowledgment

contract

42 * s.,

0 / c--,

r, O.

1•111 MI NUR MB MB MI Milli IMO MN r1111111 NMI • • MB NM Oa MI IMO I= MI


No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City Consolidated Financial Statements


23. Owner's Equity

As at 01/01/2014

- Profit in the year

- Increased in charter

capital

- Merged Water and

Contributed

charter capital

Other

Owner's equity

In estment and

Development fund

Business arrangement

assitance fund Retained earnings Minority interest

Construction

investment fund VND

4,114,604,168,030

423,809,848,492

248,934,552,343

VND

431,588,293

(39,648,836)

VND

212,847,444,230

4,178,010,122

VND

423,308,431,366

(400,000,000,000)

VND

105,343,275,175

223,337,115,953

VND

468,018,753,254

61,666,998,868

-

VND

(24,064,468,000)

21,480,965,062 Sanitation HCM City

Centre

-Increased in capital of - 39,357,458,599 Transportation and Public

Works Co., Ltd according

to Cir 127 for equitization

- Fund received from - 29,885,134,211 State Budget

- Receipt from financial

reserve 294,268, 344

- Adjusted the distribution

of profit 74,042,163,036 - (149,737,713,385) (24,098,072,989)

- Other increases 3,347,315,882 39,648,836 - Paid to State Budget (2,188,665,506) - (24,660,418,667) - Adjust for equitization

from One Member Co.,Ltd 44,379,804,024

- Bank interest 33,303,385,178 - Adjusted the

equitization in Tan Hoa

(2,532,159,837) - (8,059,268,116)

Water supply JSC

- Adjustment from MOF 4,926,386,252 (4,926,386,253) Inspectorate

- Other decreases (198,827,000) - (2,469,485,468)

As at 31/12/2014 4,786,269,327,748 39,789,046,892 283,008,349,272 100,991,620,568 159,009,818,328 500,661,292,880 24,832,145,805

• MN OM . M all MN 11. as MI MN ill SIM UM Sill INS IIMI

Sai Gon Water Corporation — One Member Limited No. 01 Cong Truor_19 Quoc Te, District 3, Ho Chi Minh City



Contributed

charter capital

Other

Owner's equity

Investment and

Development fund

Business arrangement

assitance fund Retained earnings Minority interest

Construction

investment fund VND VND VND VND VND VND VND

As at 01/01/2015 4,786,269,327,748 39,789,046,892 283,008,349,272 100,991,620,568 159,009,818,328 500,661,292,880 24,832,145,805

- Profit in the year 202,842,933,169 46,785,335,261 - Increased in charter

capital

206,510,404,003 - (116,260,942,440) (90,249,461,563)

- Received Binh Hung

sub-water system (i)

101,802,980,989

- Additional charter

capital from retained

earnings of Sai Gon

17,618,885,954

Ground Water Co., Ltd.

- Adjust for equitization (ii) (100,666,565,808) (39,286,109,107) (12,636,325,914) - (8,425,059,082) 18,514,012,702 (321,136,098) - Decrease in charter

capital of Can Gio Water

(5,083,199,230)

Supply project

- Rural Ho Chi Minh Water (5,291,404,660) Supply Enterprise received

7 water supplies (iii)

- Adjusted the distribution

of profit

72,627,259,672 - (236,910,426,412) (48,523,416,693)

- Transfered to Bonus

and welfare funds (i\O - (10,776,398,561) (8,948,354,753)

- Paid to the State - (69,909,927,283)

- Adjust for equitization

from One Member Co.,Ltd

203,759,608,343

- Bank interest 9,463,284,334

- Capital received from - 87,342,158,745 State Budget

- Changed in equity of - (626,421,393)

JSCs

- Adjustment from MOF - (4,926,386,252) 4,926,386,253

Inspectorate

- Foreign exchange diff 695,469,720 - Other adjustments (41,763,603) 95,682,655 (133,336,242)

As at 31/12/2015 5,001,160,428,996 461,174,182, 226,738,340,590 314,214;513,245 30,373,815,168 513,977,389,128 21,603,706,889

44

a Sai Gon Water Corporation — One Member Limited Consolidated Financial Statements No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City For the year ended 31/12/2015

(i) Received according to Letter No. 1415/UBND-DTMT dated 28 March 2013 from Ho Chi Minh City's People Commitee and Document No. 61/BB-DVCI dated 27 February 2015 between the Corporation and Voluntary Youth Public Benefit Service Co,. Ltd.

(ii) Reducing in charter capital of both One Member Limited Companies due to equitization and Water Design and Consultancy JSC due to transformation into joint stock company.

(iii) Transfer to Sai Gon Water Infrastructure JSC according to Decision No. 2413/QD-UBND dated 08 May 2015 from Ho Chi Minh City's People Commitee.

(iv) Applied profit distribution method which is announced by joint stock companies at the date of financial statements

24. Revenue and deductibles items

Gross revenue

Year 2015 Year 2014 VND

4,098,028,497,028

VND

3,961,714,198,024 Sales of pure water 3,582,743,821,002 3,327,252,053,668 Instaliling water pipeline, relocation,

compensation 25,782,472,623 26,799,430,839

Sales of merchandises 8,482,187,808 10,347,713,185 Revenue from construction (*) 403,332,293,637 530,914,115,725 Revenue of rendering of services 28,932,812,631 34,209,925,695 Others 48,754,909,327 32,190,958,912

Deductible items 2,909,250,709 4,205,561,189 Sales allowances 1,932,868,695 2,703,294,649 Returned goods 976,382,014 1,502,266,540

Net revenues 4,095,119,246,319 3,957,508,636,835

25. Cost of sales

Year 2015 Year 2014 VND VND

Cost of pure water production 1,570,408,549,179 1,528,783,437,524 Instaliling water pipeline, relocation,

compensation 22,328,567,022 15,941,915,332

Cost of merchandises 6,214,024,762 1,609,703,033 Cost of construction (*) 390,655,345,237 498,595,020,946 Cost of rendering of services 23,915,353,582 15,741,846,307 Others 26,387,280,735 34,339,580,670

2,039,909,120,517 2,095,011,503,812

(*) Revenue and cost of construction from Transportation and Public Works One Member Co., Ltd. were recorded from 01/01/2015 to 31/10/2015 on the consolidated financial statements as since 31/10/2015, Transportation and Public Works One Member Co., transformed into Transportation and Public Works JSC.

45

1 Sai Gon Water Corporation — One Member Limited Consolidated Financial Statements No. 01 Cong Truong Quoc Te, District 3, Ho Chi Minh City For the year ended 31/12/2015

26. Financial income

Interest on savings

Dividends

Realized gain on foreign exchange difference

27. Financial expenses

Year 2015 Year 2014 VND

54,408,722,356

7,302,957,625

7,998,453,843

VND

68,568,526,083

7,232,239,007

506,256,458

69,710,133,824 76,307,021,548


Interest expense 70,172,541,045 60,514,548,023 Realized loss on foreign exchange

difference 29,370,573,694 11,406,718

Others 32,492,530 18,857,980

99,575,607,269 60,544,812,721

28. Selling expenses


Staff cost 197,307,121,257 180,264,735,701 Packaging expenses 77,442,960,249 100,542,701,391 Depreciation 615,557,212,213 560,723,717,946 External services (*) 497,071,651,923 337,591,015,226 Other expenses by cash 14,861,477,009 23,315,173,109

1,402,240,422,651 1,202,437,343,373

(*) In 2015, water supply joint stock companies enhanced the activity of setting up new water meter for household as well as maintenance and overhaul under Decree 28/2014/NQ-HDND dated 12/12/2014 of Ho Chi Minh City's People Commitee. Hence, there is a significantly increasing in external service expenses.

In particular, Cho Lon Water Supply JSC recorded the value of some huge overhaul and install new water meter as prepaid expenses with allocation time less than 03 years (Note 9).

46

4

I

I

I

Irelocation


29. General administrative expenses

Year 2015 Year 2014

VND VND

Administrative staff 245,435,537,219 232,233,397,629 Management material 4,347,189,109 7,631,520,647 Office supplies 7,575,186,933 6,817,691,028 Depreciation 25,190,547,416 39,545,498,901 Taxes, fees and charges 12,178,887,095 10,975,708,544 Provisions 1,911,418,026 1,035,239,459 External services 19,642,061,464 26,364,918,320 Other expenses by cash 112,718,001,067 81,037,714,552

428,998,828,329 405,641,689,080

30. Other incomes

Year 2015 Year 2014

VND VND

Compensation for water supply system 115,832,242,958 101,785,022,480

Disposal of fixed assets 325,538,415 4,431,818,182

Disposal of materials 508,669,115 2,765,477,280

Customers' General pipe investment (*) 1,513,627,241 5,372,060,458

Water meter testing fee 40,337,556 150,529,796 Other incomes 20,159,405,498 18,256,825,546

138,379,820,783 132,761,733,742

31. Other expenses

Year 2015 Year 2014

VND VND

Disposal of fixed assets 3,935,679,862 9,053,344,567 Disposal of materials 399,409,137 4,728,344,988 Cost of re-allocation 2,037,768,587 4,660,831,185 General pipe investment cost (*) (1,087,339,579) 4,199,917,216 Others 11,089,512,829 10,564,299,223

16,375,030,836 33,206,737,179

(*) Other incomes are advances from customers which are not required to pay back at Cho

Lon Water Supply JSC with the purpose of investment in pipeline level 3. Simultaneously, values of corresponding works are recognized as other expenses. Moreover, adjustments of expenses from 2014 result in a decrease of expense in 2015.

32. Subsequent events

There have been no significant events occurring after the reporting period, which would

require adjustments or disclosures to be made in the consolidated financial statements.

47

MIR =II ININ MO NM BM NM IMO MI MI 1•111 • NMI ION MB 111111

Sai -Gon Water Corporation - One Member Limited Consolidated Financial Statements No. 01- Cong Truong Quoc Te, District 3, Ho Chi Minh City For the year ended 31/12/2015

33. Corresponding figures

The corresponding figures are those taken from the consolidated financial statements for the year ended as at 31/12/2015, which was audited by AASC Auditing

Fimn. In which, some items have been reclassified in accordance with inspection of Ministry of Finance ("MOF") Inspectorate in 2015 to fully reflect the transaction nature as well as to comply with Enterprise Accounting System under Circular No. 200/2014/TT-BTC dated 22 December 2014 by the MOF as follows:

Financial statements for the year ended as at 31/12/2014 After adjustment

Code Items Before adjustment Code Items After adjustment Difference

STATEMENT OF FINANCIAL POSITION

VND

STATEMENT OF FINANCIAL POSITION

VND VND

121 1. Short-term investment 612,174,382,872 (612,174,382,872) 123 3. Short-term investment held to

maturity date

634,570,015,018 634,570,015,018

258 3. Other long-term investments 168,503,962,146 253 3. Other investments in equity

instruments

72,600,000,000 (95,903,962,146)

255 5. Long-term investment held to

maturity date

73,508,330,000 73,508,330,000

132 2. Advances to suppliers 53,082,522,328 132 2. Short-term advances to suppliers 88,878,094,830 35,795,572,502 212 2. Long-term advances to suppliers 16,158,472,598 16,158,472,598

312 2. Trade payables 403,275,852,647 311 2. Short-term trade payables 388,310,163,366 (14,965,689,281) 331 1. Long-term trade payables 126,242,952,317 331 1. Long-term trade payables 193,162,686,698 66,919,734,381 135 5. Other receivables 212,127,189,330 136 6. Other short-term receivables 342,426,611,349 130,299,422,019

139 8. Insufficient assets pending to

process

7,286,839,804 7,286,839,804

158 5. Other current assets 139,773,012,628 155 5. Other short-term assets (139,773,012,628) 218 4. Other long-term receivables 25,939,863,722 216 6. Other long-term receivables 29,379,307,537 3,439,443,815 268 3. Other long-term assets 1,252,693,010 268 4. Other long-term assets (1,252,693,010) 141 1. Inventories 545,665,222,720 141 1. Inventories 273,380,002,724 (272,285,219,996)

263 3. Long-term equipments, supplies

and spare-parts

272,285,219,996 272,285,219,996

311 1. Short-term loans and liabilities 78,123,004,831 320 1. Short-term loans and liabilities 256,595,978,096 178,472,973,265 334 4. Long-term loans and liabilities 1,446,940,492,560 338 8. Long-term loans and liabilities 1,268,467,519,295 (178,472,973,265) 323 11. Bonus and welfare funds 71,589,121,004 322 12. Bonus and welfare funds 72,052,062,917 462,941,913 419 9. Other funds 462,941,913 420 10. Other funds belong to owner's

equity (462,941,913)

417 7. Investment and development fund 248,417,222,684 418 8. Investment and development fund 283,008,349,272 34,591,126,588 418 8. Financial resene fund 34,591,126,588 (34,591,126,588)

)' ;TT', 481 7‹.

. C.- I

11•111 • NM OM Ili RINI Ma MI OM IMP MB INN 11111

Sai Gon Water Corporation — One Member Limited No. 01 Con• Truon • Quoc Te, District 3, Ho Chi Minh Ci

Consolidated Financial Statements For the ear ended 31/12/2015


Code Items

Before adjustment Code Items

After adjustment

Difference VND

VND

VND STATEMENT OF FINANCIAL POSITION (cont)

131 1. Trade receivables

221 1. Tangible fixed assets

222 - Cost

223 - Accumulated depreciation

224 2. Finance lease assets

225 - Cost

226 - Accumulated depreciation

227 3. Intangible fixed assets

228 - Cost

229 - Accumulated amortization

314 4. Tax payables and statutory

obligations

420 10. Retained earnings

421 11. Construction investment funds

500 1. Minority interest

432 1. Budget resources



STATEMENT OF FINANCIAL POSITION (cont)

317,870,182,859 131 2. Short-term trade receivables 312,439,713,177 (5,430,469,682) 4,411,366,447,347 221 1. Tangible fixed assets 4,417,277,959,703 5,911,512,356

10,847,902,747,696 222 - Cost 10,847,902,747,696 - (6,436,536,300,349) 223 - Accumulated depreciation (6,430,624,787,993) 5,911,512,356

37,852,055 224 2. Finance lease assets (37,852,055) 40,000,000 225 - Cost (40,000,000) (2,147,945) 226 - Accumulated depreciation 2,147,945

188,178,687,139 227 3. Intangible fixed assets 188,216,539,194 37,852,055 226,507,094,800 228 - Cost 226,547,094,800 40,000,000 (38,328,407,661) 229 - Accumulated amortization (38,330,555,606) (2,147,945)

179,601,569,686 313 3. Tax payables and statutory

obligations

191,731,456,919 12,129,887,233

159,547,414,083 421 11. Retained earning 152,454,967,649 (7,092,446,434) 421b - Undistributed Profit of this year 152,454,967,649

31,017,008,357 422 11. Construction investment fund 24,832,145,805 (6,184,862,552) 505,587,679,132 429 1. Minority interest 500,661,292,880 (4,926,386,252) 52,988,236,653 431 1. Budget resources 1,096,272,607 (51,891,964,046)



51,891,964,046 51,891,964,046

In NMI EMI IIIIIII MIS MI MEI NIB INNII MIMI MI IIIIII I! NIB IN ION MI NI



Financial statements for the year ended as at 31/12/2014



After adjustment

Code Items

Before adjustment Code Items

After adjustment

VND

Difference

VND

VND

STATEMENT OF INCOME

STATEMENT OF INCOME

01 1. Gross revenues from goods sold

and services rendered 3,961,058,204,224 01 1. Gross revenues from goods sold


3,961,714,198,024 655,993,800

10 3. Net revenues from goods sold

and services rendered 3,956,852,643,035 10 3. Net revenues from goods sold


3,957,508,636,835 655,993,800

11 4. Cost of sales 2,296,641,877,633 11 4. Cost of sales 2,095,011,503,812 (201,630,373,821) 20 5. Gross profit from goods sold and

services rendered 1,660,210,765,402 20 5. Gross profit from goods sold and

services rendered 1,862,497,133,023 202,286,367,621

21 6. Financial income 75,790,282,541 21 6. Financial income 76,307,021,548 516,739,007 24 8. Selling expenses 998,254,148,277 25 8. Selling expenses 1,202,437,343,373 204,183,195,096 30

31

32

10. Operating profit

11. Other incomes

12. Other expenses

271,560,397,865

132,764,034,773

32,631,900,081

30

31

32

10. Operating profit

11. Other incomes

12. Other expenses

270,180,309,397

132,761,733,742

33,206,737,179

(1,380,088,468)

(2,301,031)

574,837,098 40 13. Other income 100,132,134,692 40 13. Other income 99,554,996,563 (577,138,129) 50 14. Accounting profit before tax 374,020,600,488 50 14. Accounting profit before tax 372,063,373,891 (1,957,226,597) 51 15. Corporate income tax - current 84,143,297,035 51 15. Corporate income tax - current 87,135,614,469 2,992,317,434 60 17. Net profit after tax 289,953,658,852 60 17. Net profit after tax 285,004,114,821 (4,949,544,031)

‘-=-50 -•

NM INN MIR MN UM 1111 • Mt MI IMO MR Milt MS IMO MI WM II= In MI • III


No. 01 Con• Truon. Quoc Te, District 3, Ho Chi Minh Ci Consolidated Financial Statements

For the ear ended 31/12/2015


Code Items Before adjustment Code Items After adjustment Difference

STATEMENT OF CASH FLOW

VND

STATEMENT OF CASH FLOW

VND VND

01 1. Profit/(low) before tax 374,020,600,488 01 1. Profit/(loss) before tax 372,063,373,891 (1,957,226,597) 02 Depreciation and amortisation 787,817,698,421 02 Depreciation and amortisation 781,906,186,065 (5,911,512,356) 04 Gains/(losses) from unrealized

foreign exchange 04 Gains/(losses) from foreign

exchange differences due to

revaluation of items denominated in

foreign currencies

(479,374,075) (479,374,075)

09 Decrease/(Increase) in receivables (38,853,849,600) 09 Decrease/(Increase) in receivables (39,608,242,470) (754,392,870) 11 (Increase)/Decrease in payables 516,664,240,596 11 Increase/(Decrease) in payables 1,073,041,633,446 556,377,392,850

(excluding interest payables/

corporate income tax payables) (excluding interest payables/

corporate income tax payables) 21 1. Purchase of fixed assets (1,339,904,665,446) 21 1. Purchase of fixed assets (1,922,480,486,836) (582,575,821,390) 22 2. Proceeds from disposals of fixed

assets and long-term assets

1,034,125,123 22 2. Proceeds from disposals of fixed

assets and long-term assets

5,465,943,305 4,431,818,182

31 1. Proceeds from issue of shares

and capital contribution - 31 1. Proceeds from issue of shares

and capital contribution

55,529,534,923 55,529,534,923

35 5. Finance lease principal payments (12,174,295,900) 35 5. Finance lease principal payments 12,174,295,900 36 6. Dividends paid (21,418,974,584) 36 6. Dividends paid (58,253,689,151) (36,834,714,567)


34. Approval of the consolidated financial statements

dated financial statements were approved by the Board of Directors and t- * AuthDrize • issuance on 25 April 2016. Turfs coNe

cc, Wift 301,6 *In \ * R 1 04 44N Heu

\ '

motif TWA'414

ff' to 0

Nguyen V u Deputy General Director


°•/:

C4 Dang Duc Hien

Chief Accountant

1

52

41456-023: Water Sector Investment Program - Tranche 1

Documents

Transcript of 41456-023: Water Sector Investment Program - Tranche 1