Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697795293264.pdf (Grenada)
National Water & Sewerage Authority National Water & Sewerage Authority 2 0 1 8 A N N U A L R E P O R T NAWASA • ANNUAL REPORT 2018 1 Table of Contents 03 Vision & Mission 04 Corporate Information 05 Board Of Directors 06 Chairman’s Report 09 Management Team 10 Operating Highlights 12 General Manager’s Report 28 Audited Financial Report 2018 2 NAWASA • ANNUAL REPORT 2018 Vision & Mission Our Mission To provide customers with a safe, adequate and reliable water supply and safe disposal of waste water, in a viable and efficient manner, that meets and exceeds customers’ expectations, and ensures the development of our organization, communities and our nation Our Vision A premier water utility, providing excellent service to all customers, fostering a healthy and productive nation 3 Operations ReviewGovernanceCorporate InformationAudited Financial ReportNAWASA • ANNUAL REPORT 2018 Corporate Information General Manager Mr. Christopher Husbands Registered Oﬃce The Carenage, St. George, Grenada, W.I.
Tel: (473) 440-2155 Fax: (473) 440-4107 Email: nawasa@nawasa.gd Website: www.nawasa.gd Sub Oﬃces Lower Depradine Street, Gouyave, St. John Tel: (473) 437-1606 Fax: (473) 437-1607 Seaton James Street, Grenville, St. Andrew Tel: (473) 442-7417 Fax: (473) 438-4185 Operation And Maintenance Dusty Highway, Grand Anse, St. George Tel: (473) 444-4661 Fax: (473) 444-2080 Bankers RBTT Grenada Limited Grand Anse, St. George Tel: (473) 444-4919 Grenada Co-Operative Bank Church Street, St. George Tel: (473) 440-2111 CIBC First Caribbean International Bank Church Street, St. George Tel: (473) 440-3232 Republic Bank Grenada Limited Republic House, Grand Anse, St. George Tel: (473) 444-2265 Attorneys -At -Law Wilkinson, Wilkinson & Associates Lucas Street, St. George Tel: (473) 440-3578 NAWASA’s Legal Counsel NAWASA, The Carenage, St. George Tel: (473) 440-2155 Auditors PKF Pannell House, P.O.
Box 1798 Grand Anse, St. George Tel: (473) 440-2562 4 NAWASA • ANNUAL REPORT 2018 Board Of Directors
NAWASA • ANNUAL REPORT 2018 5 Chairman’s Report 2018 was a year of strategic growth, development and the further strengthening of our foundations at the National Water and Sewerage Authority (NAWASA).
Over that last 28 years of operations, NAWASA, has consistently advanced and improved; During the last year as a member of NAWASA’s Board of Directors and Chairman, I have had the esteemed honour of contributing to the continued growth and success of the Organisation.

During the course of expanding and upgrading the nation’s water system, NAWASA commenced, completed and implemented several capital projects which have resulted in improvements in water treatment, transmission and increased storage capacity.
NAWASA also laid the foundation for signiﬁcant development and expansion of its treated and raw water supply with the securing of funding under the GCF project.

NAWASA’s sewerage operations to date have been limited to the town of St. George and communities in the south of the Island; NAWASA injected some capital in this area for upgrading and expansion of the islands sewerage systems.
6 NAWASA • ANNUAL REPORT 2018 GOVERNANCE ENGINEERING DEPARTMENTS The Board of Directors was able to meet each calendar month as required by Statute and submitted to the Government of Grenada all the mandatory Quarterly Reports on Financial Performance in accordance with stipulated timelines.
A new Board was appointed in March 2018; this team hit the ground running and continued the task of laying down the general strategy for the Organisation to execute the goals forecasted in the 2018 business plan.

In furtherance of this, the Board worked assiduously to guide operations and strategic planning even in the face of challenges both the anticipated and the unplanned.
Henry Ford commented and I quote “coming together is the beginning, staying together is progress, and working together is success”.

I therefore express sincere appreciation to my fellow Directors and credit them along with Management, Staﬀ and key stakeholders for the numerous accomplishments of 2018.

It is envisioned that in 2019, the onset of the GCF projects will result in an improvement in the capacity, quality and distribution in the water supply throughout Grenada.
In preparation of this the Board has once again approved an ambitious Business Plan which involves a capital investment of 14.5 million.

HUMAN RESOURCES/CORPORATE STRATEGY NAWASA and the representative unions settled the status of the long-term contract workers.

As of January 1, 2018, all long-term contract workers became permanent employees.
In keeping with the Strategic Goal of providing excellent service to all customers thereby becoming a more customer centric organisation, one major accomplishment of the Human Resources Department for the year 2018, has been the implementation of the Customer Care training for general staﬀ.

As NAWASA’s Pension Liability continues to grow, Pension Reform and sustainability remains a priority to the Board and Management.
The Pension Task Force continues to make strides in developing an action plan to address this issue.

NAWASA remained engrossed on improving its storage capacity, water quality and transmission and distribution network.

NAWASA partnered with the Ministry of Legal Aﬀairs to draft much needed changes to the Water Quality Act, [Act No.1 of 2005] bringing the said Act in conformity with WHO standards.

NAWASA powered onwards with the UK CIF Project, which is funded by the Caribbean Development Bank (CDB).
This project involved the preparation of a feasibility study and design for water and waste water infrastructure for the south of the Island.

The consultant, Hydroplan of Germany, submitted to NAWASA and CDB a draft report for consideration.

It is envisioned that once all components of this project are realised there will be signiﬁcant improvements in the distribution of water and the disposal of waste in the south of the island.
NAWASA has also partnered with the German Agency for International Cooperation (GIZ) as they won approval from the Green Climate Fund for Grenada’s water project entitled: Climate-Resilient Water Sector in Grenada (G-CREWS).

It is expected that the G-CREWS project, valued at EC$125 million, will catapult NAWASA and the State of Grenada as a whole to be a more climate change resilient nation and ensure that there are signiﬁcant upgrades to certain water systems throughout the island of Grenada.
The Engineering Department has installed over 30, 000 feet of pipeline through-out the island and increased water storage capacity by 600,000 gallons with the construction of storage tanks at Les Avocats and Petite Etang both in the parish of St. David.

Critical attention was also paid to upgrading certain components of the Nations Sewage systems.

Work commenced on the repair to the Point Salines Sewer Outfall.

This project shall be completed in 2019.


In addition to the foregoing, the Authority embarked upon Phase 1 of the True Blue Sewerage System Project, in the expanding community of True Blue, St. George’s.

NAWASA • ANNUAL REPORT 2018 7 STATUTORY REPORTING Over the last 3 years the ﬁrm of P.K.F has done an exemplary job of conducting NAWASA’s external audit.

On behalf of the Board of Directors, Management and Staﬀ, I wish to convey our sincere thanks for a job well done.
This year in accordance with the organisation’s policies and in compliance with the Public Finance Management Act of Grenada, the Director of Audit, in the Ministry of Finance, engaged the ﬁrm of PKF Business Advisors Ltd. to conduct the 2018 Audit.

Special thanks to the Auditors, PKF.

Business Advisors Ltd. for its professionalism and a job well done.
ACKNOWLEDGEMENTS As NAWASA moves forward into another business year, I am proud of what NAWASA has accomplished in 2018 and am enthusiastic by the visions for 2019.

On behalf of the entire Board of Directors, I once again say thanks to the Management and Staﬀ of NAWASA for without their hard work, dedication, loyalty and persistence none of the accomplishments of NAWASA would be possible.

Many thanks to the stakeholders who have continued to contribute to the development and growth of NAWASA.
It has been my pleasure and honour to serve as Chairman of NAWASA and I remain grateful to have been aﬀorded this opportunity to serve the nation of Grenada.

..................................... Mr. Anthony Mac Leish Chairman This Project, valued at over EC$3.5m, is in response to the increasing health and environmental hazards as a result of a combination of increased construction and poor waste disposal practices.
Upon completion, this project is expected to signiﬁcantly improve conditions within the service area.

Improvements were made to the Green Bridge Sewerage Outfall, with the design and construction of a new disposal facility, which will give the Authority increased control over the facility and signiﬁcantly improve the system of disposal by external waste haulers.
CUSTOMER SERVICE With its eyes set on adhering with the Strategic Goal of providing excellent service to all customers, a major accomplishment for NAWASA in 2018 has been the implementation of the Customer Care training for general staﬀ.

As a customer centric organisation this key training assured that NAWASA’s focus on customer satisfaction remained at an all-time high.
Another major achievement also aimed at providing excellent services to customers has been the development of Standard Operating Procedures (SOPs) for the technical departments.

The main aim was to provide a harmonized organizational framework that will guide the employees in performing their daily duties in a standard and methodological manner.

FINANCIAL HIGHLIGHTS Through sound ﬁscal management, NAWASA has maintained its eﬀorts to reduce expenditure and outstanding receivables.
The resultant continued ﬁnancial growth in 2018 is expected to continue in 2019 through the combined eﬀorts of all stakeholders.

NAWASA expresses its gratitude and compliments to its customers who remain committed to paying their bills on time and encourage all others to do so.

NAWASA’s long term stability and growth as an organisation is the primary focus of the Board, we are committed to the long-term growth of the organisation and will take the necessary strategic steps to ensure that reality.
8 NAWASA • ANNUAL REPORT 2018 Management Team
R e p o r t NAWASA • ANNUAL REPORT 2018 9 Operating Highlights 2018 FINANCE $.79 Expense: Revenue 2017: $.78M $580 Avg.
Domestic Revenue per Domestic Customer 2017: $579 $3,723 $5,605 Avg.

Non-Domestic Revenue per Non-Domestic Customer Avg.

Government Revenue per Government Accounts 2017: $3,729 2017: $5,817 $948 $757 Avg.

Revenue per customer Avg.


Expense per customer 2017: $941 2017: $735 101% Cash Collection: Cash Disbursement 2017: 100% 41.32 days Receivable period 2017: 50.59 days 10 NAWASA • ANNUAL REPORT 2018 HUMAN RESOURCES 5.79 No.

of Employees per 1,000 customer accounts 2017: 4.75 140 13.83hrs Training per employee 2017: 14.63hrs 225 Total No.
Employees accessing training & development Avg.

No.

Employees in Organization 2017: 117 $108,767 2017: 228 595 Expenditure on training & development.
(including Board) Employee health & Safety severity rate* 2017: $176,990 2017: 587 *Lost workdays/100 employees/year CUSTOMER SERVICE 64% Customer service compliance rate 2017: 63% NAWASA • ANNUAL REPORT 2018 11 General Manager’s Report 12 NAWASA • ANNUAL REPORT 2018 INTRODUCTION 2018 was a year in the books for the National Water and Sewerage Authority as the largest single investment in the island’s water sector was documented.
NAWASA through the support of the German Agency for International Cooperation GIZ was able to secure a $125 million-dollar transformational project for the island’s water sector.

This largest investment in the water sector to -date demonstrates the competence of the Management Team through the support of a dynamic board.

Another major investment was in the lives of 100 plus athletes of the St. Andrew’s Anglican Secondary School.

(SAASS).
(SAASS).

This was NAWASA’s largest investment ever in the area of sports, as it took on the title sponsorship role for NAWASA SAASS for the Intercol Games.

An investment of $30,000.00 ensured that the school was adequately prepared for the school games.

This investment at the Intercol Games propelled NAWASA 1st ever award at the GCIC Chamber Award in the area of Corporate Social Responsibility.
We are forever cognizant of our role as a customer focused organization and will continue to support eﬀorts like these in the years to come.

Overall, NAWASA remains conﬁdent in its eﬀorts of leadership in the water and wastewater industry, even with another proﬁtable year, and commends the Boards of Directors, Management and Staﬀ for pushing this vision in 2018.

ENGINEERING DIVISION Planning & Development A summary of projects competed is shown in ﬁgure 1.0 below.
LOCATION SCOPE BUDGETED (EC$) ACTUAL (EC$) Fort Jeudy Mt.

Agnes Brooklyn Pipe project Replacement of 3300’ of 4” lines 379,500 107,642 Mt.

Agnes Pumping Project 150,000 73,200 Installation of 4” express line from Brooklyn junction to the existing water tanks 300,000 96,120 Palmiste Replacement of 6” mains along the Palmiste main road.
500,000 665,028 Relocation of pipes on Lucas street Relocation of pipes on Lucas Street to facilitate the construction of the Headquarters building 500,000 250,000 True Blue pipeline upgrade Installation of 3000ft of 4” ductile iron pipe 200,000 180,000 Mt.
Williams and Mirabeau Dams Construction of 300ft step en route to dam with hand rail 75,000 72,000 NAWASA • ANNUAL REPORT 2018 13 LOCATION SCOPE BUDGETED (EC$) ACTUAL (EC$) Les Avocats, Mirabeau, Spring Gardens and Mamma Cannes Construction of 3000ft reinforced concrete road 735,000 400,000 Mardigras, Annadale and Grand Roy Construction of 900 ft two strip road with slipper drain 84,000 103,000 Peggy’s Whim, Mirabeau, Mardigras Installation of 1390 ft chain link chain 103,970 85,000 Grenville Cash oﬃce Relocation of Grenville Cash oﬃce 120,000 104,000 Green Bridge Construction of facility for disposal of septic tank waste 50,000 58,964 Grand Anse sewer LS#4 Replacement of two (2) 20hp pumps with two (2) 40 hp 300,000 278,000 St George’s, St David’s, St. Andrew’s, St. John’s and St. Mark’s School Tap project with funding support from CDEMA 243,000 220,000 TOTAL 3,740,470 2,692,954 Figure 1.0 Projects completed in 2018 NAWASA Secures Funding From The Green Climate Fund NAWASA with the support of the German Agency for International Cooperation (GIZ) won approval from the Green Climate Fund for Grenada’s water project entitled: Climate-Resilient Water Sector in Grenada (G-CREWS) This transformational project valued at EC $125 Million is the single largest investment in the island’s water sector to date, and will ensure that there are signiﬁcant upgrades to certain systems throughout the island with the total budget ﬁnanced as follows: x The Green Climate Fund – EC 105 million (Grant) x Government of Germany – EC 7.5 million (Grant) x Government of Grenada/NAWASA –EC 12.5 million (in kind and cash) This project was scheduled to start on October 1st 2018 with an expected end date of September 30th, 2024.
14 NAWASA • ANNUAL REPORT 2018 Water Resources Figure 1.0 below shows comparative rainfall data for the past three years which shows an increase in rainfall by 1,337.46 mm over 2017.
COMPARATIVE RAINFALL DATA 8000 6000 4000 2000 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2018 2017 2016 Figure 1.0 – Comparative Rainfall Data PRODUCTION & QUALITY Water distributed during the year 2018 increased by 191.78 million gallons or 7.80% over 2017.

Figure 3.0 below gives details of comparative data of water production for the years 2016, 2017 and 2018.
A u d i t e d F n a n c a i i l COMPARATIVE WATER PRODUCTION R e p o r t 240 230 220 210 200 190 s n o l l a G n o i l l i M Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2018 2017 2016 Figure 3.0 – Water Production NAWASA • ANNUAL REPORT 2018 15 The department continued eﬀorts to register improvements in both water quality and treatment plants aesthetics.
Figure 4.0 below is a comparative summary of Microbiological sampling for the years 2016,2017 and 2018 and shows the continued general good quality of potable water produced, with very low percentages of positive samples.

COMPARATIVE MICROBIOLOGICAL SAMPLES 3000 2000 1000 0 Total quality checks No.

of samples taken No.

of positive Samples 2018 2016 2017 Fig.


4.0 – Microbiological Samples TRANSMISSION AND DISTRIBUTION A number of pipeline projects were undertaken by this Department to improve the level of service in speciﬁc villages.

For the year ending 31st December 2018, a total of thirteen (13) projects were completed at an estimated cost of ﬁve hundred and sixty-eight thousand and six hundred dollars ($568,600.00).
These projects included line upgrade, replacement, relocation and extensions in varying locations throughout the island as shown in table 1.0 below.

NO.

LOCATION PARISH NO.

LOCATION PARISH Sunrise Drive (Fort Jeudy) St. George’s Samuel Avenue St. George’s 8 9 Carriere St. Andrew’s De Blando St. Andrew’s Tobago Village St. George’s 10 Barbay (Florida) St. John’s Karlan Park St. George’s La Poterie Telescope St. Andrew’s St. Andrew’s 11 12 13 Windsor Forest St. David’s Beaton Mt.
Gazo St. David’s St. David’s Conference St. Andrew’s Table 1.0 – Micro Projects NAWASA • ANNUAL REPORT 2018 17 Operations ReviewGovernanceCorporate InformationAudited Financial ReportNAWASA • ANNUAL REPORT 2018 During the year, a total of seven thousand, three hundred and seventy-eight (7,378), leaks were repaired, an increase of 10% compared to 2017.
St. George’s and St. Andrew’s continued to be the most active districts (Ref Figure 5.0) which correlates with the fact that they have the largest amount of pipeline infrastructure.

REPAIRS BY PARISH 3000 2500 2000 1500 1000 500 0 St. Andrew St. Patrick St. John/St.

Mark St. David St. George 2017 2018 Figure 5.0 – Comparative Repairs by Parish An average of 614 repairs were carried out per month with half inch repairs being 48% of total repairs done.
Figure 6.0 shows that repairs per month has increased by 34% when compared to 2017.

MONTHLY REPAIRS 800 700 600 500 400 300 200 100 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2017 2018 Figure 6.0 – Comparative Total Repairs 18 NAWASA • ANNUAL REPORT 2018 New Connections A total of eight hundred and eighty-four (884) new Private Water Connections (PWS) were completed for 2018, 37 more compared to 2017.

These include additional meters on existing properties.
PARISH JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL St. Patrick St. Mark/ St. John St Andrew St David St. George TOTAL Table 2.0- Private Water Service The district of St. George dominated the list with four hundred and thirty-one (431) of these connections or 49% of the total completed for the year as shown in ﬁgure 7.0 below.
MONTHLY REPAIRS 8% 9% 49% 22% St. George St. David St. Andrew St. Mark/St.

John 12% St. Patrick Figure 7.0 – PWS Connections Garage Unit The Authority’s fleet comprised of 46 vehicles and 36 pieces of equipment at year end.

The cost for maintenance (which included parts and service costs) of the vehicle fleet was approximately $222,677 compared to $255,961 in 2017.
Tyre replacement and fuel costs for the year amounted to $104,541 and $78,598 respectively compared to $102,621 and $80,929 for 2017.

NAWASA • ANNUAL REPORT 2018 19 HUMAN RESOURCES DEPARTMENT Stafﬁng The department recorded a total staﬃng level of 225 at the end of 2018, compared to 228 in 2017, a diﬀerence of three (3) employees.

This total included one hundred and one (101) permanent and one hundred and twenty-four (124) long term contracted employees.
Short term contracted employees amounted to ﬁfty- eight (58) in 2018, compared to sixty-six (66) in 2017.

During the year 2018, the department placed emphasis on general and technical training and conferences.

Some of these included Customer Care, Standard First Aid, Technical Report Writing, Coaching and Mentoring, Microsoft Access, among others.
Invitations were received from institutions locally, regionally and internationally for NAWASA’S participation in diverse areas of training, including seminars and conferences.

A total of 140 employees received training, which amounted to 1,937 training hours at a total cost of $108,767.

Retirees for 2018 During the year under review, the Authority bid farewell to seven (07) employees, who proceeded on their retirement leave after years of continuous service as shown in Table 3.0.

NO.
NO.

NAMES POSITION DEPARTMENT/ UNIT YEARS OF SERVICE RETIREMENT DATE Francis Drakes Foreman T&D 31 years January 22, 2018 Ezekiel Aird Plant Operator P&Q 21 years & 7 months March 1, 2018 Danley Fletcher Plant Operator P&Q 30 years May 22, 2018 Morgan Stewart Groundsman P&Q 7 years May 11, 2018 Arnold Bhagwan Asst.
Manager - Garage Kenny Patrick Pipeﬁtter Kenny Charles Foreman Garage 38 years & 4 months June 7, 2018 T&D T&D Table 3.0 – Retirees 29 years & 7 months June 1, 2018 23 years & 2 months October 13, 2018 Board’s Deputy Director, Feron Lowe make presentation to retirees Ezekiel Aird, Francis Drakes and Morgan Stewart 20 NAWASA • ANNUAL REPORT 2018 budget.

A number of channels were identiﬁed for strategic delivery of messages.
The result is a continued thriving social media network, new advertising collateral and improved data gathering for monitoring, benchmarking and evaluating the success of our methods and allowing for adjustments as necessary.

PUBLIC EDUCATION & CAMPAIGNS Public Service Announcements These include Service Interruption Notices, Disconnection Notices, Road Closures, Community Meetings and Oﬃce Closure.
A total of 2926 PSAs were disseminated in 2018 compared to 1752 in 2017, representing a 59% increase over 2017.

The increase was due to system and network maintenance.

Interruption notices therefore continue to dominate as the message type most frequently disseminated.

World Water Day Activities World Water Day is held annually on 22 March to focus attention on the importance of fresh and clean water.
World water day is also celebrated for advocating for the sustainable management of freshwater resources.

It remains our activity of international magnitude for the calendar year and for 2018 was celebrated under the theme: Nature for Water.
R e p o r t Study Leave During the year under review, eight (08) employees proceeded on short term study leave with pay, which amounted to ﬁfty-four (54) days.

The highest amount emanated from the Finance department with a total of twenty-ﬁve (25) days.

Mr. Damani Bruno, Engineer, resumed employment with the Authority during the year 2018, after proceeding on eighteen (18) months study leave.
Mr. Bruno completed his studies leading to a Master’s degree in Hydrology and Water Resources at UNESCO- IHE Delft, Netherlands.

Safety & Health The total number of certiﬁed sick days recorded for the year 2018 was 1,226 compared to 1,317, a decrease of 91 days.

The total number of days recorded as uncertiﬁed sick leave for the year 2018 amounted to one hundred and seventy-seven (177) days, compared to sixty-one (61) days in 2017, an increase of one hundred and sixteen.
Employees Received medical check-up The Authority, collaborated with the Ministry of Health (MOH), to engage the services of registered nurses and a Health Practitioners to administer quarterly onsite medical tests and health education for interested staﬀ.

This comes in recognition by Management of the importance of caring for employees’ health and wellness needs.
COMMUNICATIONS UNIT NAWASA’s Communications Unit continued to increase its activities for the purpose of advocacy and education as it relates to water as well as corporate visibility.
Key to the unit’s success was the continued implementation of aspects of the communications plan which integrated all NAWASA’s programs, public education and advocacy eﬀorts as a guide to achieving organisational objectives within agreed Employee Donavon Burke participates in Drink Water Day NAWASA • ANNUAL REPORT 2018 21 SAASS 2nd place -Water Warz A number of activities were carried out in observance of World Water Day which included the following:- Drink Water Day This activity was established by the team to encourage persons to drink water replacing the usual beverages.
The feedback was exceptional with numerous schools on the island participating and posting and sharing their videos and images to Social Media.

School Activities x Water Warz - returned for Season 4 from July 4th to 6th, 2018, targeting once again the nation’s secondary schools.

The Hillsborough Secondary School dethroned the Grenada Boys Secondary School to capture this year’s title.
The St. Andrew’s Anglican Secondary School placed 2nd and the boys on the hill (GBSS) placed third, following the completion of the ﬁnals at the Annex of the Grenada Trade Center.

The St. John’s Christian Secondary School placed 4th in the competition, held July 2nd, 4th and 6th at the Grenada Trade Centre Annex.

It began with 12 schools in the preliminary round, going head to head in the jeopardy styled, quiz competition on water related topics.
x Recycle for Change Model – The objective of this activity was to depict how Grey water can be transformed to a usable supply.

This project took the form of a MODEL COMPETITION and schools created a model demonstrating “How Greywater can be recycled into usable water”.

A team of three (3) judges visited the three participating schools (two (2) on Grenada and one (1) in Carriacou) on March 23rd and 26th to judge the models.

The Peak Institute was awarded the winning prize.
Peak Institute, winner of Recycle for Change Competition 22 NAWASA • ANNUAL REPORT 2018 PROJECT EXECUTION AND SUPPORT NAWASA’S Community Water Storage Project Water storage tanks were provided and installed at eighteen (18) schools throughout the island who had no form of storage and experienced challenges when there were periods of water interruptions.
Carrying Tank for placement on platform at the Green Street Pre Primary School This project was funded through The Caribbean Disaster Management Agency (CDEMA), with money approved under the Caribbean Disaster Fund by the European Union Country Directed Fund (EDF) of over EC $200,000.00.

Brooklyn Water System Upgrade The National Water and Sewerage Authority expended approximately two hundred and ﬁfty thousand dollars ($250,000.00) on upgrading the water system serving residents of Brooklyn in St. John.
The recently completed Brooklyn water system upgrade allows the residents of the upper part of the community to receive a constant pipe borne supply.

Christmas Food Hamper The National Water and Sewerage Authority continued its support of less fortunate individuals by providing more than three dozen Grenadians with food hampers, ahead of Christmas 2018, as part of its ongoing promotion, which ﬁts in to its corporate social responsibility.
A total of 40 hampers were distributed to individuals on mainland Grenada and the sister isles of Carriacou and Petite Martinique, during the week of December 17th through 21st 2018, as a means of bringing Christmas cheer individuals of lesser means.

Into its ﬁfteenth year, the NAWASA Christmas Food Hamper promotion was expanded in 2018 to beneﬁt forty (40) beneﬁciaries, up from thirty-ﬁve (35).
The forty (40) beneﬁciaries, were nominated by individuals who, in most cases, looked beyond their own needs to ensure their friend or neighbor has a joyous Christmas.

Tank installation at Bonair Government School NAWASA employees distributing Christmas food hampers NAWASA • ANNUAL REPORT 2018 23 NAWASA SAASS with Communications Supervisor, Mrs Jamila Samuel ATHLETIC SEASON The Authority continued its support to a number of areas during the year but more visible in the area of sports.
A number of schools were provided ﬁnancial support in the area of trophies and medals.

Intercol Games In 2018, NAWASA made a bold step and invested heavily in athletics in Grenada, as the title sponsor for the St. Andrew’s Anglican Secondary School (SAASS), at the Scotia Bank Intercol Games.

This decision saw the school being adequately prepared to compete at the March 20th to 22nd games with the provision of uniforms, meals and transportation, among other things.

Inter Sector Cricket Competition.


NAWASA completed its journey in the Inter Sector Cricket Competition advancing to the top 16.

The Authority lost to 2017 defending champions Grenada Union of Teachers and failed to advance to the quarterﬁnals, the ﬁrst time ever since our return to the tournament 4 years ago.

The competition wrapped up with Adrian Gabriel Construction capturing the title after a keenly contested ﬁnal encounter against Dodgy Blazers.
Jubilant NAWASA SAASS displays trophies 24 NAWASA • ANNUAL REPORT 2018 NAWASA delegates at GCIC Business Awards Fostering Public Relations, Awareness & Understanding Social media has proven its value to NAWASA by oﬀering the following powerful features such as Instant Communication, Feedback, and Advertising etc.
NAWASA Facebook and Twitter accounts have been useful for reporting outages and leakages within communities, provide real time response to challenges met by consumers ranging from account balances, queries about operation and employment enquiries.

At year’s end Facebook had a total of 7,481 likes, an increase of 1,862.

Twitter closed the year with 1,066, this represents 106 new followers.

Youtube ended the year with 45 videos.


GCIC Business Awards – 2018 NAWASA was the proud recipient of the GCIC Business Awards in the area of Corporate Social Responsibility This initiative by the GCIC celebrates local businesses that have excelled, persevered and continue to provide employment, excellent products and services both locally and overseas.
CPEA Awards The National Water and Sewerage Authority on Friday July 20th, 2018, awarded nine children of employees, who were successful in the 2018 Caribbean Primary Exit Assessment (CPEA); at a ceremony held at the company’s board room at its Carenage oﬃce.

NAWASA’s CPEA Awards was introduced in 2003 and since its inception a total of 120 students have beneﬁtted.
CPEA Recipients with their parents NAWASA • ANNUAL REPORT 2018 25 FINANCE Income and Expenditure For the ﬁscal year ended December 31st, 2018 the National Water and Sewerage Authority reported a net proﬁt of $7,740,075 this represents a marginal increase of $5,982 from the prior year, which was $7,734,093.

Receivable turnover days declined from 50.59 days in 2017 to 41.32 days as at 31st December 2018.

Revenue for 2018 was $36,570,523, an increase of $1,326,817 or 4% from 2017 which was $35,243,706.
Water, sewerage and other income of $849,975.

$276,457 and $303,216 respectively were the main engines behind this increase.

Commercial revenue was $9,898,356 in 2018 as compared to $9,472,889 in 2017.

Figure 8.0 below gives details on Expenditure by Departments.

EXPENTIDURE BY DEPARTMENT 5% 14% 23% 3% 26% 2% 26% Government ministerial accounts declined by $114.139, due to the timely settlement of monthly bills.
Figure 8.0 – Expenditure P&D P&Q Sewer T&D Admin Garage Finance COMMERCIAL UNIT The Commercial Unit continues to show positive results, as evidenced in the reduction of accounts receivables turnover days.

The units continued to peruse delinquent receivables.

At the end of 2018 receivables were $3,345,575, reduced by $507,698.

This was due to the diligent work by staﬀ.

During the year the Unit conducted 3,412 disconnections and 3,783 reconnections.
The Asset Protection Unit investigated 1,042 service orders for suspected tampering of which 32 were oﬀenders and were charged accordingly.

Sale to ships increased by $74,419 or 32% from the prior year.

Through its investment in regional Governmental Treasury Bills the Authority realised investment income of $350,663.

Total expenditure for the year was $28,830,420, an increase of $1,329,945 or 05% when compared to 2017.

All categories of expenditure increased from the prior year.
Direct expenditure increased by $1,039,704.

This may be attributed to several factors including increase in the cost of mains and pumps maintenance, electricity and road reinstatement.

Indirect expenditure increased by $285,736 or 02% from 2017.

This was due to the number of persons proceeding on retirement leave and increase in beneﬁts for retirees.

Annual expenditure on electricity and road reinstatement were $1.17M and $.71M respectively, compared with $ .98 and $.64M respectively for 2017.
26 NAWASA • ANNUAL REPORT 2018 The Authority received judgements in 15 of these matters valued at $13,963.

Therefore as at December 2018 there were 80 matters pending decision in the Magisterial Courts with the sum claimed being $79,073.

INFORMATION TECHNOLOGY During the year the Authority continued its investment in technology in the amount of $89,909.

This included the procurement of six (6) desktop computers, three (3) Laptops, two (2) Lexmark Form Printers and the purchase of 300,000 bills.
ACKNOWLEDGEMENT I wish to place on record my appreciation for the continued support of the public and for their appreciation of the improvements that the Organisation continues to make.

I wish to thank the Board of Directors for their support during the year, and the Management and Staﬀ for their continued support and dedication.

I look forward to further improvements in the coming year as we work together in furtherance of our Mission.
Mr. Christopher Husbands General Manager R e p o r t Figure 9.0 gives details of receivables balances ACCOUNTS RECEIVABLE 4,000,000 3,500,000 3,000,000 Accounts Receivable Figure 9.0 –Receivable balance CUSTOMER SERVICE UNIT During the year 2018, the total number of service orders completed was 32,111 with compliance rate of 64%.
As it relates to the standards set out in the Customer Services Charter, the Authority achieved an average adherence rate of 64% which is 1% increase from 2017’s adherence rate of 63%.

LEGAL UNIT During the ﬁscal year 2018, arrears of $183,340 on 657 accounts were pursued through the legal system.

Payments in the sum of $134,610 were made by debtors based on initial contact.
There were 87 claims, at a cumulative value of EC $30,468 ﬁled in the Magistrates’ Courts throughout the state against persons who had been in arrears in excess of 6 months, and had failed to respond to requests to commit to an arrangement to settle their arrears.
NAWASA • ANNUAL REPORT 2018 27 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) Audited Financial Report 2018 28 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) Table of Contents 34 Statement Of Financial Position 35 Statement Of Comprehensive Income 36 Statement Of Changes In Equity 37 Statement Of Cash Flow 38 Notes To The Financial Statements NAWASA • ANNUAL REPORT 2018 29 Pannell House | P.O.
Box 1798 | Grand Anse | St. George’s NOTES TO THE FINANCIAL STATEMENTS Grenada | West Indies Tel (473) 440-2562/3014/2127/0414 for the year ended 31st December, 2018 (...continued) Fax (473) 440-6750 | Email pk@spiceisle.com INDEPENDENT AUDITORS’ REPORT TO THE MINISTER RESPONSIBLE FOR WORKS, PHYSICAL DEVELOPMENT AND PUBLIC UTILITIES ON National Water And Sewerage Authority OPINION We have audited the ﬁnancial statements of the National Water and Sewerage Authority (the “Authority”), which comprise the statement of ﬁnancial position at December 31, 2018, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the ﬁnancial statements, including a summary of signiﬁcant accounting policies.
RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE FINANCIAL STATEMENTS Management is responsible for the preparation and fair presentation of the ﬁnancial statements in accordance with IFRSs, and for such internal controls as management determines is necessary to enable the preparation of ﬁnancial statements that are free from material misstatement, whether due to fraud or error.
In our opinion, the accompanying ﬁnancial statements present fairly, in all material respects, the ﬁnancial position of the Authority as at December 31, 2018 and its ﬁnancial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs).

BASIS FOR OPINION We conducted our audit in accordance with International Standards on Auditing (ISAs).
Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report.

We are independent of the Authority in accordance with the ethical requirements that are relevant to our audit of the ﬁnancial statements in Grenada, and we have fulﬁlled our other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is suﬃcient and appropriate to provide a basis for our opinion.
In preparing the ﬁnancial statements, management is responsible for assessing the Authority’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Authority either intends to liquidate the National Water and Sewerage Authority or to cease operations, or has no realistic alternative but to do so.
AUDITORS’ RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS Our objectives are to obtain reasonable assurance about whether the ﬁnancial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually 30 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) INDEPENDENT AUDITORS’ REPORT TO THE MINISTER RESPONSIBLE FOR WORKS, PHYSICAL DEVELOPMENT AND PUBLIC UTILITIES ON National Water And Sewerage Authority (...continued) or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these ﬁnancial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit.

We also: » Identify and assess the risks of material misstatement of the ﬁnancial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is suﬃcient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

» Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
» Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast signiﬁcant doubt on the Authority’s ability to continue as a going concern.
If we conclude that a material uncertainty exists; we are required to draw attention in our auditor’s report to the related disclosures in the ﬁnancial statements or, if such disclosures are inadequate, to modify our opinion.

Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.

However, future events or conditions may cause the Authority to cease to continue as a going concern.
» Evaluate the overall presentation, structure and content of the ﬁnancial statements, including the disclosures, and whether the ﬁnancial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and signiﬁcant audit ﬁndings, including any signiﬁcant deﬁciencies in internal control that we identify during our audit.
GRENADA May 8th, 2019 Accountants & Business Advisers NAWASA • ANNUAL REPORT 2018 31 STATEMENT OF FINANCIAL POSITION NOTES TO THE FINANCIAL STATEMENTS As At December 31, 2018 for the year ended 31st December, 2018 (...continued) ASSETS Non-current assets Property, plant and equipment Current Assets Inventories Investment securities Trade and other receivables Cash and cash equivalents 2018 2017 69,327,436 66,143,784 7,346,226 7,547,189 9,248,846 5,108,229 4,040,879 4,173,465 25,992,590 24,182,254 46,628,541 41,011,137 TOTAL ASSETS $115,955,977 $107,154,921 EQUITY AND LIABILITIES Capital Retained earnings 9 17,808,593 17,808,593 58,743,178 53,503,103 TOTAL EQUITY 76,551,771 71,311,696 Non-current liabilities Retirement beneﬁt obligation not yet due Deferred income Current Liabilities Trade and other payables Retirement beneﬁt obligation 12 10 11 12 20,000,000 17,500,000 4,176,317 4,406,478 24,176,317 21,906,478 3,462,585 2,275,406 11,765,304 11,661,341 15,227,889 13,936,747 TOTAL LIABILITIES 39,404,206 35,843,225 TOTAL EQUITY AND LIABILITIES $115,955,977 $107,154,921 The accompanying notes on pages form an integral part of these ﬁnancial statements Approved by the Board of Directors on March 28th, 2019 and signed on its behalf by: : Chairman : General Manager 32 NAWASA • ANNUAL REPORT 2018 STATEMENT OF COMPREHENSIVE INCOME NOTES TO THE FINANCIAL STATEMENTS For The Year Ended December 31, 2018 for the year ended 31st December, 2018 (...continued) NOTES 2018 2017 13 14 15 34,806,583 33,783,008 (16,318,033) (15,278,329) 18,488,550 18,504,679 1,763,913 1,460,697 Revenue Direct costs Gross proﬁt Other income Total operating income 20,252,463 19,965,376 Administrative and general expenses 20 12,457,286 12,171,550 Operating proﬁt Finance cost 7,795,177 7,793,826 16 (55,102) (59,733) Net proﬁt for the year $7,740,075 $7,734,093 The accompanying notes on pages form an integral part of these ﬁnancial statements c
NAWASA • ANNUAL REPORT 2018 33 STATEMENT OF CHANGES IN EQUITY NOTES TO THE FINANCIAL STATEMENTS For The Year Ended December 31, 2018 for the year ended 31st December, 2018 (...continued) CAPITAL RETAINED EARNING TOTAL EQUITY Balance at 1st January, 2017 17,751,630 47,003,612 64,755,242 Land grant 56,963 - 56,963 Depreciation adjustment (Note 19) Transfer to retirement beneﬁt obligation Net proﬁt for the year - - - 1,265,398 1,265,398 (2,500,000) (2,500,000) 7,734,093 7,734,093 Balance at 31st December, 2017 17,808,593 53,503,103 71,311,696 Transfer to retirement beneﬁt obligation Net proﬁt for the year - - (2,500,000) (2,500,000) 7,740,075 7,740,075 Balance at 31st December, 2018 $17,808,593 $58,743,178 $76,551,771 The accompanying notes on pages form an integral part of these ﬁnancial statements 34 NAWASA • ANNUAL REPORT 2018 STATEMENT OF CASH FLOW NOTES TO THE FINANCIAL STATEMENTS For The Year Ended December 31, 2018 for the year ended 31st December, 2018 (...continued) NOTES 2018 2017 7,740,075 7,734,093 4,000,128 3,916,539 (237,853) (252,198) OPERATING ACTIVITIES Net proﬁt for the year Adjustments for: Depreciation Amortization of deferred income Transfer to retirement beneﬁt obligation (2,500,000) (2,500,000) Loss/(gain) on disposal of property, plant and equipment 43,267 (93,244) Cash inflow before working capital changes 9,045,617 8,805,190 Decrease/(increase) in inventories Decrease in trade and other receivables Increase in trade and other payables 200,463 (731,486) 132,586 91,469 1,187,179 731,272 Increase in retirement beneﬁt obligations 2,603,963 1,999,767 Cash provided by operating activities 13,170,308 10,896,212 INVESTING ACTIVITIES Proceeds from sale of property, plant and equipment 80,000 169,601 Purchase of property, plant and equipment (7,307,047) (5,865,332) Increase in investment securities Cash used in
 investing activities FINANCING ACTIVITIES Increase in capital grant Net decrease in borrowings Increase in deferred income Cash provided by ﬁnancing activities (4,140,617) (5,108,229) (11,367,664) (10,803,960) - - 56,963 (1,127,867) 7,692 2,163,837 7,692 1,092,933 Net increase in cash and cash equivalents 1,810,336 1,185,185 Cash and cash equivalents - at beginning of the year 24,182,254 22,997,069 - at end of the year 8 $25,992,590 $24,182,254 The accompanying notes on pages form an integral part of these ﬁnancial statements NAWASA • ANNUAL REPORT 2018 35 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 for the year ended 31st December, 2018 (...continued) 1.
CORPORATE INFORMATION The Authority was created by Act of Parliament No.

25 of 1990 to take over the operations of the former Central Water Commission and with sole jurisdiction in all matters pertaining to the supplying of all potable water and sewerage facilities throughout Grenada.

At the statement of ﬁnancial position date the Authority employed one hundred and one (101) permanent workers, one hundred and twenty-one (121) contracted workers and ﬁfty-eight (58) temporary workers.
(2017: 107, 121 and 66 respectively).

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Preparation These ﬁnancial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) under the historical cost convention.

The preparation of ﬁnancial statements in conformity with IFRS’s requires the use of certain critical accounting estimates.

It also requires management to exercise its judgment in the process of applying the Authority’s accounting policies.
Although those estimates are based on management’s best knowledge of current events and conditions, actual results could diﬀer from these estimates.

The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are signiﬁcant to the ﬁnancial statements are disclosed in note 3.
(b) Changes in accounting policies and disclosures i) New accounting standards, amendments and interpretations The accounting policies adopted in the preparation of the ﬁnancial statements are consistent with those followed in the preparation of the Authority’s annual ﬁnancial statements for the year ended December 31, 2017 except for the adoption of new standards and interpretations below.
IFRS 9 Financial Instruments (effective 1 January, 2018) Financial instruments: Recognition and measurement IFRS 9 replaces IAS 39 Financial Instruments: Recognition and Measurement for annual periods on or after 1 January 2018.

The Authority has not restated comparative information for 2017 for ﬁnancial instruments in the scope of IFRS 9.

Therefore, the comparative information for 2017 is reported under IAS 39 and is not comparable to the information presented for 2018.
Changes to classification and measurement To determine their classiﬁcation and measurement category, IFRS 9 requires all ﬁnancial assets, except equity instruments and derivatives, to be assessed based on a combination of the entity’s business model for managing the assets and the instruments’ contractual cash flow characteristics.

36 NAWASA • ANNUAL REPORT 2018 2.
NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The IAS 39 measurement categories of ﬁnancial assets (fair value through proﬁt or loss (FVPL), available for sale (AFS), held-to-maturity (HTM) and loans and receivables (L&R) have been replaced by: » Debt instruments at amortised cost (AC); » Debt instruments at fair value through other comprehensive income (FVOCI), with gains or losses recycled to proﬁt or loss on derecognition; » Equity instruments at FVOCI, with no recycling of gains or losses to proﬁt or loss on derecognition; and » Financial assets at fair value through proﬁt or loss (FVPL) The accounting for ﬁnancial liabilities remains largely the same as it was under IAS 39 which is at amortised cost.
The Authority’s classiﬁcation of its ﬁnancial assets and liabilities is in Note 2(d).

The quantitative impact of applying IFRS 9 as at 31 December, 2018 is disclosed in the transition disclosures in this note.

Changes to impairment calculation The adoption of IFRS 9 has changed the Authority’s accounting for ﬁnancial assets impairment by replacing IAS 39’s incurred loss approach with a forward-looking expected credit loss (ECL) approach.
IFRS 9 requires the Authority to record an allowance for ECLs for all ﬁnancial assets not held at FVPL.

The allowance is based on the ECLs associated with the probability of default in the next twelve months unless there has been a signiﬁcant increase in credit risk since origination.
IFRS 7 Financial Instruments: Disclosures Revised To reflect the diﬀerences between IFRS 9 and IAS 39, IFRS 7 - Financial Instruments: Disclosures revised was up-dated and the Authority has adopted it, together with IFRS 9, for the year beginning 1 January, 2018.

Changes include transition disclosures as shown in this note.
Transition disclosures The following sets out the impact of adopting IFRS 9 on the statement of ﬁnancial position, which is the eﬀect of replacing IAS 39’s incurred credit loss calculations with IFRS 9’s ECLs.
NAWASA • ANNUAL REPORT 2018 37 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued , 2 8 1 , 4 2 , 5 6 4 3 7 1 , 4 - - C A , 9 2 2 8 0 1 , 5 - - - - - - - 4 5 2 , 2 8 1 , 4 2 R & L , 5 6 4 3 7 1 , 4 R & ) 9 2 2 8 0 1 , , 5 ( , 9 2 2 8 0 1 , 5 M T H s t e s s a l i a c n a n ﬁ y t i r u t a m - o t - d e H l - , 9 2 2 8 0 1 , 5 - - R & L s t e s s a l i a c n a n ﬁ r e h t O C A – s e i t i r u c e s t n e m t s e v n I M T H M T H – s t e s s a l i a c n a n ﬁ y t i r u t a m - o t - d e h m o r F l ) d e u n ti n o c .
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2 38 NAWASA • ANNUAL REPORT 2018 C A C A C A 6 0 4 5 7 2 , , 2 1 4 3 , 1 6 6 , 1 1 , 0 0 0 0 0 5 7 1 , , 8 4 9 3 6 4 3 3 $ , - $ - $ - - - - - - , 8 4 9 3 6 4 3 3 $ , 6 0 4 5 7 2 , , 2 C A 1 4 3 , 1 6 6 , 1 1 C A , 0 0 0 0 0 5 7 1 , C A 7 4 7 , 6 3 4 , 1 3 $ - $ - $ 7 4 7 , 6 3 4 , 1 3 $ NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (b) Changes in accounting policies and disclosures (...continued) i) New accounting standards, amendments and interpretations (...continued) IFRS 7 Financial Instruments (...continued) Transition disclosures (...continued) As of 1 January 2018, the Authority has re-classiﬁed its previous loans and receivables and held to maturity ﬁnancial asset portfolio as investment securities at amortised cost.
These instruments met the solely payments of principle and interest (SPPI) criterion, were not actively traded and were held with the intention to collect cash flows and without the intention to sell.

The Authority’s IFRS 9 category is amortised cost (AC).
IFRS 15 Revenue from Contracts with Customers (effective 1 January 2018) IFRS 15 replaces all existing revenue requirements in IFRS (IAS 11 Construction Contracts, IAS 18 Revenue, IFRIC 13 Customer Loyalty Programmes, IFRIC 15 Agreements for the Construction of Real Estate, IFRIC 18 Transfers of Assets from Customers and SIC 31 Revenue – Barter Transactions Involving Advertising Services) and applies to all revenue arising from contracts with customers, unless the contracts are in scope for other standards, such as IAS 17 Leases (or IFRS 16, once eﬀective).
It also provides a model for the recognition and measurement of gains and losses on disposal of certain non-ﬁnancial assets including property, equipment and intangible assets.

The standard outlines the principles an entity must apply to measure and recognise revenue.

The core principle is that an entity will recognise revenue at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer.
The principles in IFRS 15 must be applied using a ﬁve-step model: 1.

Identify the contract(s) with a customer.

2.

Identify the performance obligations in the contract.

3.

Determine the transaction price.

4.

Allocate the transaction price to the performance obligations in the contract.

5.

Recognise revenue when (or as) the entity satisﬁes a performance obligation.
The standard requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers.

The standard also speciﬁes how to account for the incremental costs of obtaining a contract and the costs directly related to fulﬁlling a contract.

NAWASA • ANNUAL REPORT 2018 39 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (b) Changes in accounting policies and disclosures (...continued) i) New accounting standards, amendments and interpretations (...continued) The standard is more prescriptive than the current IFRS requirements for revenue recognition and provides more application guidance.

The disclosure requirements are also more extensive.
When IFRS 15 is adopted, it can be applied either on a fully retrospective basis, requiring the restatement of the comparative periods presented in the ﬁnancial statements, or a modiﬁed retrospective approach which is applied as an adjustment to retained earnings on the date of adoption.

When the latter approach is applied it is necessary to disclose the impact of IFRS 15 on each line item in the ﬁnancial statements in the reporting period.

The adoption of this standard has no impact on the Authority.
IFRS 2 Classification and Measurement of Share-based Payment Transactions – Amendments to IFRS 2 (effective 1 January 2018) The IASB issued amendments to IFRS 2 Share-based Payment in relation to the classiﬁcation and measurement of share-based payment transactions.
The amendments address three main areas: » The eﬀects of vesting conditions on the measurement of a cash-settled share-based payment transactions » The classiﬁcation of a share-based payment transaction with net settlement features for withholding tax obligations » The accounting where a modiﬁcation to the terms and conditions of a share-based payment transaction changes its classiﬁcation from cash-settled to equity-settled.

The adoption of this standard has no impact on the Authority.
IFRIC Interpretation 22 Foreign Currency Transactions and Advance Consideration (effective 1 January 2018) The interpretation clariﬁes that in determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or part of it) on the de-recognition of a non-monetary asset or non-monetary liability relating to advance consideration, the date of the transaction is the date on which an entity initially recognises the non- monetary asset or non-monetary liability arising from the advance consideration.
If there are multiple payments or receipts in advance, then the entity must determine a date of the transactions for each payment or receipt of advance consideration.

The adoption of this standard has no impact on the Authority.

40 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (b) Changes in accounting policies and disclosures (...continued) ii) Standards in issue not yet eﬀective The following is a list of standards and interpretations that are not yet eﬀective up to the date of issuance of the Authority’s ﬁnancial statements.

The Authority intends to adopt these standards where appropriate, when they become eﬀective.
» Amendments to IAS 19 – Plan Amendment, Curtailment or Settlement (Eﬀective 1 January 2019) IFRS 16 Leases (Eﬀective 1 January 2019) IFRIC Interpretation 23 Uncertainty over Income Tax Treatments (Eﬀective 1 January 2019) IFRS 17 insurance Contracts (Eﬀective 1 January 2021) IFRS 10 and IAS 28 Sale or Contribution of Assets between an investor or Joint Venture – Amendments to IFRS 10 and IAS 28 (Eﬀective date postponed indeﬁnitely) IFRS 9 – Prepayment features with negative compensation (Eﬀective 1 January 2019) » » » » » » Amendments to IAS 28 – Long-term Interest in Associates and Joint Ventures (Eﬀective 1 January 2019) » Amendments to IAS 19 – Plan Amendments, Curtailment or Settlement (Eﬀective 1 January 2019) » Amendments to References of the Conceptual Framework in IFRS Standards (Eﬀective 1 January 2020) iii) Improvements to International Financial Reporting Standards The annual improvements process of the International Accounting Standards Board deals with non-urgent but necessary clariﬁcations and amendments to IFRSs.
The following amendments are applicable to annual periods beginning on or after 1 January 2019.

IFRS Subject of Amendment IFRS 3 Business Combinations – Previously held interests in a joint operation.

IFRS 11 Joint Arrangements – Previously held interests in a joint operation.

IAS 12 Income Taxes – Income tax consequences of payments on ﬁnancial instruments classiﬁed as equity.

IAS 23 Borrowing Costs – Borrowing costs eligible for capitalization.
NAWASA • ANNUAL REPORT 2018 41 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (c) Property, Plant and Equipment Recognition and Measurement Property, plant and equipment consist of building, plant and machinery, motor vehicles, furniture and ﬁttings and are stated at historical cost less accumulated depreciation.
Historical cost includes expenditure that is directly attributable to the acquisition of the asset.

The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located.
Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognized as income in the statement of comprehensive income.
Subsequent Expenditure The cost of replacing part of an item of property, plant and equipment is recognized in the carrying amount of the item or recognised as a separate asset, as appropriate, only when it is probable that the future economic beneﬁts embodied within the part will flow to the Authority and its cost can be measured reliably.

The carrying amount of the replaced part is derecognized.
The costs of the day-to-day servicing and other repairs and maintenance of property, plant and equipment are recognized in the statement of comprehensive income during the ﬁnancial period in which they are incurred.

Depreciation Depreciation is recognized in the statement of comprehensive income on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment.

Land and rights are not depreciated.


No depreciation is provided on work-in-progress until the assets involved have been completed and available for use.

Property, plant and equipment are stated at cost less accumulated depreciation.

Subsequent costs are included in the assets carrying amounts or are recognised as a separate asset, as appropriate, only when it is probable that future economic beneﬁts associated with the item will flow to the Authority and the cost of the item can be measured reliably.
All other repairs and maintenance are charged to the statement of comprehensive income during the ﬁnancial period in which they are incurred.

42 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (c) Property, Plant and Equipment (...continued) Land is not depreciated.

Depreciation on other assets is calculated using the straight-line method to allocate their cost to their residual values over their estimated useful lives.
The rates used are as follows: Per annum % Building and Equipment 2.5 Oﬃce furniture and Computer equipment 10 – 33.33 Miscellaneous tools and Equipment Motor vehicle and Heavy Equipment Production Equipment 10 10 – 25 2.5 The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the statement of ﬁnancial position date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

(d) Financial instruments i) Classiﬁcation and measurement Financial instruments are contracts that give rise to a ﬁnancial asset of one entity and a ﬁnancial liability or equity instrument of another entity.
Financial assets and ﬁnancial liabilities are recognised on the Authority’s statement of ﬁnancial position when the Authority becomes party to the contractual provision of the instrument.

All regular way purchases and sales of ﬁnancial assets are recognised or derecognised on the trade date that is the date on which the Authority commits itself to purchase or sell an asset.
A regular way purchase and sale of ﬁnancial assets is a purchase or sale of an asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the market place concerned.

Initial measurement The classiﬁcation of ﬁnancial instruments at initial recognition depends on their contractual terms and the business model for managing the instruments.
Financial instruments are initially measured at their fair value, except in the case of ﬁnancial assets and ﬁnancial liabilities recorded at fair value through proﬁt or loss (FVPL) whereby transaction costs are added to, or subtracted from, this amount.

Measurement categories of financial assets and liabilities From 1st January, 2018 the Authority classiﬁes all of its ﬁnancial assets at amortised cost.
Before 1st January, 2018 the Authority classiﬁed its ﬁnancial assets as loans and receivables and held to maturity.

NAWASA • ANNUAL REPORT 2018 43 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (d) Financial instruments (...continued) i) Classiﬁcation and measurement (...continued) The Authority retained the existing requirements in IAS 39 for the classiﬁcation of ﬁnancial liabilities which is at amortised cost.

Amortised cost From 1st January, 2018 the Authority measures its cash and cash equivalents, investment securities, and trade and other receivables at amortised cost.
Financial assets are measured at amortised cost if both of the following conditions are met: » The ﬁnancial asset is held within a business model with the objective to hold ﬁnancial assets in order to collect contractual cash flows and » The contractual terms of the ﬁnancial asset give rise on speciﬁed dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding.
ii) Impairment (Policy applicable from 1st January, 2018) The adoption of IFRS 9 has fundamentally changed the Authority’s ﬁnancial assets impairment methodologies by replacing the incurred loss approach under IAS 39 with a forward-looking expected credit loss (ECL) approach.

The ECL model requires the Authority to account for expected credit losses and changes in those expected credit losses at each reporting date.
Therefore, it is no longer necessary for a credit event to have occurred before credit losses are recognised.

From 1st January 2018 the Authority has been recording an allowance for expected credit (ECL) losses for it’s ﬁnancial asset where applicable.

ECLs are based on the diﬀerence between the contractual cash flows due in accordance with the contract and all the cash flows that the Authority expects to receive.

ECLs are recognised in two stages.


For credit exposures for which there has not been a signiﬁcant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL).
For those credit exposures for which there has been a signiﬁcant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

The Authority considers a ﬁnancial asset in default when internal or external information indicates that the Authority is unlikely to receive the outstanding contractual amounts in full.
Based on the above process, the Authority classiﬁes its ﬁnancial asset ECLs, except for trade receivables, into Stage 1, Stage 2 and Stage 3 where applicable.

44 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (d) Financial instruments (...continued) ii) Impairment (Policy applicable from 1st January, 2018) (...continued) Stage 1 Financial assets are ﬁrst recognised, the Authority recognises an allowance based on 12 month ECLs.

Stage 1 also includes ﬁnancial assets where the credit risk has improved and the ﬁnancial assets have been reclassiﬁed from Stage 2.
Stage 2 When ﬁnancial assets have shown a signiﬁcant increase in credit risk since origination, the Authority records an allowance for the Lifetime ECLs.

Stage 2 also includes ﬁnancial assets where the credit risk has improved and ﬁnancial assets have been reclassiﬁed from Stage 3.

Stage 3 Financial assets considered credit-impaired.
Here the Authority records an allowance for the Lifetime ECLs (LTECLs) The mechanics of the ECL calculations are outlined below and the key elements are, as follows: PD - EAD - LGD - The Probability of Default is an estimate of the likelihood of default over a given into period of time.

A default may only happen at a certain time over the asserted period, if the facility has not been previously derecognised and is still in the portfolio.
The Exposure at Default is an estimate of the exposure at a future default date, taking into account expected changes in the exposure after the reporting date including repayments of principal and interest, whether scheduled by contract or otherwise.

The Loss Given Default is an estimate of the loss arising in the case were a default occurs at a given time.

It is based on the diﬀerence between the contractual cash flows due and the cash flows expected to be received.
It is usually expressed as a percentage of the EAD.

The maximum period for which the credit losses are determined is the contractual life of a ﬁnancial instrument.

The maximum period for which the credit losses are determined is the contractual life of a ﬁnancial instrument.

NAWASA • ANNUAL REPORT 2018 45 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (d) Financial instruments (...continued) ii) Impairment (Policy applicable from 1st January, 2018) (...continued) Calculation of ECLs Stage 1 The 12mECL is calculated as the portion of LTECLs that represent the ECLs that result from default events on a ﬁnancial instrument that are possible within the 12 months after the reporting date.
The Authority calculates the 12mECL allowance based on the expectation of a default occurring in the 12 months following the reporting date.

These expected 12-month default probabilities are applied to a forecast EAD and multiplied by the expected LGD.

Stage 2 When ﬁnancial assets has shown a signiﬁcant increase in credit risk since origination, the Authority records an allowance for the LTECLs.
The mechanics are similar to those explained above, but PDs and LGDs are estimated over the lifetime of the loan.

Stage 3 For ﬁnancial assets considered credit-impaired, the Authority recognises the lifetime expected credit losses for these ﬁnancial assets.

The method is similar to that for Stage 2 assets, with the PD set at 100%.
A ﬁnancial asset is impaired if, and only if, there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a “loss event”) and that event (or events) has an impact on the estimated future cash flows of the ﬁnancial asset or group of ﬁnancial assets that can be reliably estimated.
Objective evidence that a ﬁnancial assets or group of ﬁnancial assets is impaired includes observable data that comes to the attention of the Authority about the following loss events: i) Signiﬁcant ﬁnancial diﬃculty of the issuer or obligor.

ii) A breach of contract, such as default or delinquency in interest or principal payments.

iii) It is becoming probable that the borrower will enter in bankruptcy or other ﬁnancial re-organization.
iv) The disappearance of an active market for that ﬁnancial asset because of ﬁnancial diﬃculties.

46 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (d) Financial instruments (...continued) ii) Impairment (Policy applicable from 1st January, 2018) (...continued) Impairment of Trade Receivables From 1st January 2018 the Authority has been recording an allowance for expected credit losses for its trade receivables using a simpliﬁed approach.

The ECL allowance is based on the credit losses expected to arise over the life of the assets (LTECL).
The ECL on these ﬁnancial assets are estimated used a provision matrix that is based on it historical credit loss experience, adjusted for forward-looking factors speciﬁc to the debtors and the economic environment.

The provision rates used in the provision matrix are based on days past due.

The LTECLs for the Authority’s trade receivables are calculated on an individual basis with various categories.
iii) Write oﬀs The gross carrying amount of a ﬁnancial asset is written oﬀ to the extent that there is no realistic prospect of recovery.

This is generally when the Authority determines that the borrower does not have assets or resources of income that would generate suﬃcient cash flows to repay the amount subject to the write-oﬀ.

However, the ﬁnancial assets could still be subject to enforcement activities in order to comply with the Authority’s procedures.
iv) Derecognition of ﬁnancial assets The Authority derecognises a ﬁnancial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the ﬁnancial asset and substantially all the risks and rewards of ownership of the asset to another entity.
If the Authority neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Authority recognises its retained interest in the asset and an associated liability for amounts it may have to pay.

If the Authority retains substantially all the risks and rewards of ownership of a transferred ﬁnancial asset, the Authority continues to recognise the ﬁnancial asset and also recognises a collateralised borrowing for the proceeds received.
On derecognition of a ﬁnancial asset measured at amortised cost, the diﬀerence between the asset’s carrying amount and the sum of the consideration received and receivable is recognised in proﬁt or loss.

v) Financial liabilities When ﬁnancial liabilities are measured at fair value of the consideration given plus transactions costs directly attributable to the acquisition of the liability.

Financial liabilities are re-measured at amortised.
Financial liabilities are derecognized when they are extinguished, that is when the obligation speciﬁed in the contract as discharged, cancelled or expired.

The diﬀerence between the carrying amount of a ﬁnancial liability extinguished and the consideration price is recognised in the statement of comprehensive consideration price is recognised in the statement of comprehensive income.

NAWASA • ANNUAL REPORT 2018 47 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (e) Foreign Currencies Foreign currency transactions during the year have been eﬀected at the rates of exchange ruling at the dates of the transactions.

Monetary assets and liabilities denominated expressed in foreign currencies are re-translated to Eastern Caribbean Currency Dollars at the rates of exchange ruling at the statement of ﬁnancial position year.
Diﬀerences arising from fluctuations in exchange rates are included in the statement of comprehensive income.

(f) Pension and Gratuity The Authority’s pension and gratuity plan is a non-contributory plan, for all permanent employees with twenty (20) years of continuous service.

Contributions are charged to the statement of comprehensive income.

(g) Inventories Inventories are stated at the lower of cost incurred in bringing each product to its present location and condition and net realizable value.
Cost is determined on a ﬁrst-in, ﬁrst-out basis.

Net realizable value is the price at which stock can be realized in the normal course of business.

(h) Trade receivables Trade receivables are amounts due from customers for services performed in the ordinary course of business.

If collection is expected in one year or less, they are classiﬁed as current assets.

If not, they are presented as non-current assets.


Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the eﬀective interest method, less provision for impairment.

Trade receivables, being short-term, are not discounted.

A provision for impairment of trade receivables is established when there is objective evidence that the Authority will not be able to collect all amounts due according to the original terms of the receivable.
Signiﬁcant ﬁnancial diﬃculties of the debtor and default or delinquency in payment are considered indicators that the trade receivable is impaired.

(i) Cash and Cash Equivalents Cash and cash equivalents comprise cash on hand and at bank and short-term demand deposits with original maturity of three (3) months or less.

(j) Capital Capital contributions by the Government of Grenada are classiﬁed as equity.
(k) Trade payables Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

Trade payables are classiﬁed as current liabilities if payment is due within one year or less.

If not, they are presented as non-current liabilities.

48 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (...continued) (l) Borrowings Borrowings are recognised at fair value net of transaction cost incurred.

Borrowings are subsequently stated at amortized cost: any diﬀerence between the proceeds, net of transaction cost, and the redemption value is recognised in the statement of comprehensive income over the period of borrowings.
Borrowings are classiﬁed as current liabilities unless the Authority has an unconditional right to defer settlement of the liability for at least twelve (12) months after the statement (m) Customers’ deposits Customer deposits are shown in the statement of ﬁnancial position as current liabilities, since it can be repaid within twelve (12) months of the date of the statement of ﬁnancial position.

(n) Taxation The Authority is exempt from the payment of income tax.

3.
3.

CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS IN APPLYING ACCOUNTING POLICIES The development of estimates and the exercise of judgment in applying accounting polices may have a material impact on the Authority’s reported assets, liabilities, revenues, beneﬁts and expenses.
The items which may have the most eﬀect on the Authority’s ﬁnancial statements are set out below Impairment of Inventory Provision is made for obsolete, slow moving and defective stocks.

R e p o r t Impairment of financial assets Management assesses at each statement of ﬁnancial position date whether assets are impaired.
An asset is impaired when the carrying value is greater than its recoverable amount and there is objective evidence of impairment.

Recoverable amount is the present value of the future cash flows.

Provisions are made for the excess of the carrying value over its recoverable amount.
Property, plant and equipment Management exercises judgment in determining whether future economic beneﬁts can be derived from expenditures to be capitalized and in estimating the useful lives and residual values of these assets.

NAWASA • ANNUAL REPORT 2018 49 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 3.
CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS IN APPLYING ACCOUNTING POLICIES (...continued) Provision for expected credit losses of trade receivables The Authority uses a provision matrix to calculate ECLs for trade receivables.

The provision rates are based on days past due net of Government of Grenada balances.

The provision matrix is initially based on the Authority’s historical observed default rates.
The Authority will calibrate the matrix to adjust the historical credit loss experience with forward- looking information.

At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed.

The assessment of the correlation between historical observed default rates, forecast economic conditions and ECLs is a signiﬁcant estimate.

The amount of ECLs is sensitive to changes in circumstances and of forecast economic conditions.
The Authority’s historical credit loss experience and forecast of economic conditions may also not be representative of customer’s actual default in the future.
50 NAWASA • ANNUAL REPORT 2018 L A T O T - N I - K R O W D N A S L O O T , 5 4 8 2 3 5 4 2 1 , , 3 5 9 2 8 1 , 4 , 3 3 8 2 7 8 4 , , ) 5 9 8 6 2 5 , 1 6 ( - , ) 9 3 5 5 3 5 2 ( , , ) 7 3 2 9 4 0 3 ( , ) 7 8 0 7, 2 1 , 5 ( , ) 2 3 0 5 1 8 0 5 ( , - i n o i t a c e r p e d d e t a u m u c c A l , 0 6 2 9 8 7 3 , , 3 0 7 8 5 4 5 , , 0 6 5 9 9 3 0 0 1 , , 6 3 5 9 2 8 5 , 6 1 0 2 , / , Y T R E P O R P .
NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) , 0 5 9 5 0 0 3 6 $ , , 0 5 9 5 0 0 3 6 , , 3 5 9 2 8 1 , 4 $ 4 9 2 7, 3 3 2 $ , , 3 2 0 0 4 7 $ 6 1 6 , 1 3 3 $ , 3 5 9 2 8 1 , 4 4 9 2 7, 3 3 2 , 3 2 0 0 4 7 , 6 1 6 , 1 3 3 , 8 2 5 4 8 5 9 4 $ , , 6 3 5 9 2 8 5 $ , 7 1 0 2 , , 8 2 5 4 8 5 9 4 , , 6 3 5 9 2 8 5 , l e u a v k o o b g n n e p O i , 7 4 0 8 9 7 , 1 1 9 6 6 7, 4 0 2 , , 7 4 5 0 2 3 5 3 5 2 7 5 , 1 5 2 , 1 8 2 , 4 3 5 6 9 4 8 , , ) 5 1 7 2 3 9 5 ( , , 8 9 3 5 6 2 , 1 ) 7 5 3 6 7 ( , , ) 9 3 5 6 1 9 3 ( , - - - , ) 5 1 7 2 3 9 5 ( , - - - ) 0 5 4 6 7 ( , ) 6 ( 9 9 - - - - - , 8 9 3 5 6 2 , 1 ) 2 0 1 , 3 5 4 ( ) 9 6 4 , 1 2 4 ( ) 0 4 0 3 1 2 ( , , ) 8 2 9 8 2 8 2 ( , - - - - 1 1 5 9 7 , , 4 8 7 3 4 1 , 6 6 $ 7 0 9 7, 9 2 $ , 9 3 7 4 0 2 2 $ , , 0 3 4 6 5 5 2 2 1 , , ) 6 4 6 2 1 4 6 5 ( , - 7 0 9 7, 9 2 , 9 9 7 0 9 5 4 , , ) 0 6 0 6 8 3 2 ( , , 9 3 6 4 1 8 $ , 1 2 8 9 9 3 $ 1 3 6 7, 1 5 6 5 $ , , 7 4 0 9 0 9 5 $ , ) 7 6 3 7, 6 2 3 ( , , ) 4 7 3 9 3 7 2 ( , , ) 5 4 8 9 1 0 8 4 ( , - , 6 0 0 2 8 0 4 , 5 9 1 , 9 3 1 , 3 6 7 4 7, 3 5 4 0 1 , , 7 4 0 9 0 9 5 , , / , 3 4 1 , 6 6 $ 7 0 9 , 7 9 2 $ 9 3 7 , 4 0 2 , 2 $ , 9 3 6 4 1 8 $ , 1 2 8 9 9 3 $ 1 3 6 , 7 1 5 6 5 $ , , 7 4 0 9 0 9 5 $ , E U L A V K O O B T E N NAWASA • ANNUAL REPORT 2018 51 ) 7 6 2 3 2 1 ( , ) 8 2 1 , 0 0 0 4 ( , 6 3 4 7, 2 3 9 6 $ , 6 7 1 , 1 1 4 9 2 1 , NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) , 0 3 4 6 5 5 2 2 1 , , ) 6 4 6 2 1 4 6 5 ( , - 7 0 9 7, 9 2 , 4 8
 7 3 4 1 , 6 6 $ 7 0 9 7, 9 2 $ , 4 8 7 3 4 1 , 6 6 7 0 9 7, 9 2 7 4 0 7, 0 3 7, , 5 1 8 9 7 3 6 , - ) 4 0 9 7, 5 4 2 ( , , 9 9 7 0 9 5 4 , L A T O T - N I - - - , 8 1 8 9 1 2 4 $ , , 9 7 7 3 7 3 0 9 4 9 7 , 7 1 4 6 8 , 6 4 5 7, 8 3 - - - - - - 4 0 9 7, 5 4 2 , ) 7 6 2 3 2 1 ( , ) 8 0 8 8 7 4 ( , , ) 7 1 8 6 7 3 ( ) 3 0 0 9 6 1 ( , , ) 0 0 5 5 7 9 2 ( , - - - - , ) 0 1 7 9 9 0 2 $ , 2 1 3 7, 1 5 $ 5 3 2 7, 1 3 $ , 4 1 3 4 6 2 6 5 $ , , 7 4 0 9 0 9 5 $ , , ) 0 4 7 3 8 0 0 6 ( , - , ) 8 6 8 4 6 8 2 ( , , ) 4 0 9 6 3 3 3 ( , , ) 7 7 3 8 0 9 2 ( , , 8 1 8 9 1 2 4 , , 8 7 5 4 6 9 4 , , 6 1 2 4 5 8 3 , , 2 1 6 5 2 2 3 , , ) 1 9 5 3 7 9 0 5 ( , - 5 0 9 7, 3 2 7, 0 1 , 7 4 0 9 0 9 5 , 6 3 4 , 7 2 3 9 6 $ , , 8 1 8 9 1 2 4 $ , 0 1 7 , 9 9 0 2 $ , 2 1 3 , 7 1 5 $ 5 3 2 , 7 1 3 $ , 4 1 3 4 6 2 6 5 $ , , 7 4 0 9 0 9 5 $ , , / NAWASA • ANNUAL REPORT 2018 , ) 0 6 0 6 8 3 2 ( , ) 7 6 3 7, 6 2 3 ( , , ) 4 7 3 9 3 7 2 ( , , ) 5 4 8 9 1 0 8 4 ( , - i n o i t a c e r p e d d e t a u m u c c A l , 9 3 7 4 0 2 2 $ , , 9 3 7 4 0 2 2 , , 9 3 6 4 1 8 $ , 1 2 8 9 9 3 $ 1 3 6 7, 1 5 6 5 $ , 9 3 6 4 1 8 , , 1 2 8 9 9 3 1 3 6 7, 1 5 6 5 , , 7 4 0 9 0 9 5 $ , 8 1 0 2 , , 7 4 0 9 0 9 5 , l e u a v k o o b g n n e p O i , 6 0 0 2 8 0 4 , 5 9 1 , 9 3 1 , 3 6 7 4 7, 3 5 4 0 1 , , 7 4 0 9 0 9 5 , 7 1 0 2 , / ) d e u n ti n o c .
.

.

( I T N E M P U Q E D N A T N A L P , Y T R E P O R P .

4 52 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 5.

INVENTORIES Balance as at 31st December, 2018 7,972,737 8,175,290 Less: Provision for obsolescence (626,511) (628,101) 2018 2017 $7,346,226 $7,547,189 6.
INVESTMENT SECURITIES First Citizen Investments Services Limited - Government of Antigua and Barbuda 180 day Treasury bill 5,281,857 - Government of St. Lucia 180 day Treasury bill 3,945,748 - - - Government of Grenada 180 day treasury bill - 5,055,348 - Matured proceeds180 days deposit 21,241 52,881 $9,248,846 $5,108,229 Matured investments: British American Insurance Company Limited - Policy #BGG002711 - Policy #BGG003143 - Policy #BGG003708 i F n a n c a i l 979,624 1,250,964 689,736 766,373 1,201,505 1,201,505 R e p o r t Less: Amount recovered during the year 2,870,865 3,218,842 - 347,977 2,870,865 2,870,865 Less: Expected credit loss 2,870,865 2,870,865 - - NAWASA • ANNUAL REPORT 2018 53 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 7.
TRADE AND OTHER RECEIVABLES 2018 2017 Water and Sewer debtors 3,549,355 4,017,751 Ship debtors Hydrant debtors 79,924 46,933 7,694 - Total trade receivables 3,636,973 4,064,684 Less: Expected credit loss (309,349) (573,108) Net trade receivables Other receivables 3,327,624 3,491,576 725,214 693,848 Less: Other expected credit loss (11,959) (11,959) $4,040,879 $4,173,465 Movement in expected credit loss of trade and other receivables are as follows: Balance at 1st January, 2018 585,067 395,374 Net (decrease)/increase in provision (38,620) 385,591 Amounts written oﬀ (225,139) (195,898) Balance at 31st December, 2018 $321,308 $585,067 8.
CASH AND CASH EQUIVALENTS RBTT Bank Grenada Limited - Current Account (i) 803,848 1,161,384 - Current Account (ii) 698,540 518,863 Republic Bank (Grenada) Limited – Current Account 12,500,889 12,911,318 Grenada Co-operative Bank Limited - Current Account 5,231,525 5,696,403 - Certiﬁcate of deposit 2,522,317 567,888 Bank of Nova Scotia – Current Account 2,370,069 1,865,858 First Caribbean International Bank Limited – Current Account Cash floats Petty cash 1,862,465 1,457,542 2,300 2,300 637 698 Balance at 31st December, 2018 $321,308 $585,067 54 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 9.
CAPITAL CONTRIBUTION - GOVERNMENT OF GRENADA 2018 2017 Balance at 1st January, 2018 1,7,808,593 17,751,630 Add: Value of land transferred - 56,963 Balance at 31st December, 2018 $1,7,808,593 $24,182,254 10.
DEFERRED INCOME Balance at 1st January, 2018 4,406,478 2,494,839 Grants received during the year - 2,163,837 Amount transferred to income 230,181 252,198 4,406,478 4,658,676 Balance at 31st December, 2018 $4,176,317 $4,406,478 This relates to grants received as follows: » Government of Grenada » Basic Needs Trust Fund » Caricom/Spain Technical Co-operation Program » Lease rental income received in advance These grants were used to develop water distribution and storage facilities and are being credited to income at the rate of 2.5% to 20% per annum, consistent with the rate charged for depreciation on related assets.
11.

TRADE AND OTHER PAYABLES Trade payables Accrued expenses Other payables 78,414 44,944 3,180,687 2,098,735 203,484 131,727 $3,462,585 $2,275,406 NAWASA • ANNUAL REPORT 2018 55 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 12.
RETIREMENT BENEFIT OBLIGATION This represents provisions in the amount of $2,277,156 and $9,488,148 made for Pension and Gratuity respectively, for all permanent employees and management personnel with over twenty (20) years of continuous service.

An actuarial valuation in 2016 revealed that the Authority’s pension liability as at March 31st, 2016 was $66.79 million.

At December 31, 2018, a provision of $20,000,000 has been allocated to this liability.

13.
13.

REVENUE Water rates Sewer rates Service connection Sales to ships Sales from hydrant 14.

DIRECT COST 2018 2017 30,503,324 29,653,349 3,442,539 3,166,082 519,222 696,212 309,529 235,110 31,969 32,255 $34,806,583 $33,783,008 Planning, design and construction 1,471,870 1,405,483 Production and quality Sewerage 7,147,859 6,759,691 528,804 524,188 Transmission and distribution 7,169,550 6,588,967 $16,318,033 $15,278,329 15.
OTHER INCOME Investment impairment recovered - 347,977 Bad debts recovered Deferred income recognized 82,137 77,734 237,853 252,199 Gain on sale of property, plant and equipment 79,999 80,526 Miscellaneous income 1,363,924 702,261 $1,763,913 $1,460,697 56 NAWASA • ANNUAL REPORT 2018 16.
FINANCE COST Bank charges Other ﬁnance costs NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 2018 2017 33,244 22,796 21,858 36,937 $55,102 $59,733 17.

18.

DEPRECIATION ADJUSTMENT This relates to the overstatement of depreciation on meters in 2017.

COMPARATIVE FIGURES Certain of the 2017 comparative ﬁgures have been reclassiﬁed to conform the current year’s ﬁnancial statements presentation.

These changes have no impact on the proﬁt reported for the previous year.
19.

FINANCIAL RISK MANAGEMENT The Authority’s activities expose it to the following risk from the use of ﬁnancial instruments: » Credit risk » Liquidity risk » Currency risk » Interest rate risk » Operational risk Risk management structure The Board of Directors is responsible for the overall risk management approach and for Approving the risk strategies, principles, policies and procedures.
Day to day adherence to risk to risk principles is carried out by the management of the Authority in compliance with the policies approved by the Board of Directors.

The Authority’s risk management policies are established to identify and analyse the risk faced by the Authority, to set appropriate risks limits and controls and to monitor risk and adherence to limits.

Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Authority’s activities.
The Authority through its training and management standards and procedures aims to develop a disciplined and constructive control environment, in which all employees understand their roles and obligations.

NAWASA • ANNUAL REPORT 2018 57 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 19.
FINANCIAL RISK MANAGEMENT (...continued) Credit risk Credit risk is the risk of ﬁnancial loss to the Authority if a customer or counter party to a ﬁnancial instrument fails to meet its contractual obligations and arises principally from the Authority’s receivables from customers and its loans and receivable ﬁnancial assets.
Management of credit risk i) Trade receivables Concentration of credit risk with respect to trade receivables is small as the Authority’s customer base is large and unrelated, with no signiﬁcant balances arising from a single economic or business sector or single entity or group of entities.

The Authority manages credit risk through the daily monitoring of trade receivables, court proceedings and tampering charges on an individual basis.
Where necessary, customers’ accounts are disconnected in order to reduce credit risk exposure.

ii) Other ﬁnancial assets With respect to credit risk arising from the other ﬁnancial assets of the Authority, which comprise cash and cash equivalents and loans and receivables ﬁnancial assets, the Authority’s exposure to credit risk arises from default of the counter-party.
The Authority seeks to hold its funds with ﬁnancial institutions which management regards as sound and the market for investments are monitored regularly to ensure that returns are guaranteed.

Exposure to credit risk The following table shows the maximum exposure to credit risk for the components of the statement of ﬁnancial position.
MAXIMUM EXPOSURE 2018 2017 Investment securities 9,248,846 5,108,229 Trade and other receivables 4,040,879 4,173,465 Cash and cash equivalents 25,992,590 24,182,254 $39,282,315 $33,463,948 58 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 19.
FINANCIAL RISK MANAGEMENT (...continued) Set out below is the information about the credit risk exposure on the Authority trade and other receivables using a provision matrix.
0 – 30 DAYS 31 -60 DAYS 61 – 360 DAYS OVER 360 DAYS TOTAL December 31st, 2018 Expected credit loss rate 0.50% 6.00% 9.00% 40% Gross carrying amount 2,257,643 165,804 260,447 865,461 3,549,355 Expected credit loss (11,288) (9,948) (23,440) (264,672) (309,349) January 1st, 2018 $2,246,355 $155,856 $237,007 $600,789 $3,240,006 Expected credit loss rate 0.50% 6.00% 9.00% 40% Gross carrying amount 2,260,303 194,979 326,992 1,235,477 4,017,751 Expected credit loss (11,302) (11,699) (29,429) (520,680) (573,109) $2,249,001 $183,280 $297,563 $714,797 $3,444,642 Set out below is information about the credit risk exposure on the Authority’s matured investments.
December 31st, 2018 Expected credit loss rate Gross carrying amount Expected credit loss January 1st, 2018 Expected credit loss rate Gross carrying amount Expected credit loss STAGE 1 STAGE 2 STAGE 3 100.00% 2,870,865 (2,870,865) $ - 2,870,865 (2,870,865) $ - - - $ - - - $ - - - $ - - - $ - NAWASA • ANNUAL REPORT 2018 59 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 19.
FINANCIAL RISK MANAGEMENT (...continued) Liquidity risk Liquidity risk is the risk that the Authority will have diﬃculty in meeting towards its obligations to its ﬁnancial liabilities.

Management of liquidity risk The Authority’s approach to managing liquidity is to ensure, as far as is possible, that it will always have suﬃcient liquidity to meet is liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses.
The Authority monitors its cash flow position on a daily basis and generally monitors its risk to a shortage of funds by considering planned and probable expenditures against projected cash inflows from operations.

Where possible the Authority utilizes surplus internal funds to ﬁnance its operations and ongoing projects.
The table below analyses the Authority’s ﬁnancial liabilities into relevant groupings based on the remaining period at the statement of ﬁnancial position date to the contractual maturity date.
< 1 YEAR 1 TO 5 YEARS >5 YEARS TOTAL Balance at 31st December, 2018 30,503,324 29,653,349 Trade and other payables $3,462,585 $ - $ - $3,462,585 Balance at 31st December, 2017 Trade and other payables $2,275,406 $ - $ - $2,275,406 Interest rate Interest rate risk is the risk that the fair value of future cash flows of a ﬁnancial instrument will fluctuate because of changes in market interest rates.
Exposure to interest rate risk The Authority is exposed to interest rate risk through the eﬀect of fluctuations in the prevailing levels of interest rates on interest bearing ﬁnancial assets and liabilities, including loans.

Management of interest rate risk The Authority interest rate risk is managed through monitoring market conditions and yields.
Operational risk Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the Authority’s processes, personnel, technology and infrastructure, and from external factors other than credit, market and liquidity risks such as those arising from legal and regulatory requirements including periodic adjustments of tariﬀs.

Operational risks arise from all of the Authority’s operations.
The Authority’s objective is to manage operational risk so as to balance the avoidance of ﬁnancial losses and damage to the Authority’s reputation with overall cost eﬀectiveness and to avoid control procedures that restrict initiative and creativity.

60 NAWASA • ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 19.
FINANCIAL RISK MANAGEMENT (...continued) The primary responsibility for the development and implementation of controls to address operational risk is assigned to senior management within each business unit.
This responsibility is supported by the development of overall standards for the management of operational risk in the following areas: » Requirements for appropriate segregation of duties, including the independent authorization of transactions » Requirements for the reconciliation and monitoring of transactions » Compliance with regulatory and other legal requirements » Documentation of controls and procedures » Requirements for the periodic assessment of operational risks faced, and the adequacy of controls and procedures to address the risks identiﬁed » Requirements for the reporting of operational losses and proposed remedial action » Development of contingency plans » Training and professional development » Ethical and business standards » Risk mitigation, including insurance where this is eﬀective » Periodic review of the tariﬀ structure NAWASA • ANNUAL REPORT 2018 61 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31st December, 2018 (...continued) 20.
ADMINISTRATIVE AND OVERHEAD EXPENSES Wages, salaries and allowances 4,723,365 4,845,507 National insurance contributions 470,228 467,647 2018 2017 Pensions Staﬀ uniform Staﬀ beneﬁts Entertainment Training and overseas travel Electricity Telephone 2,738,480 2,463,951 178,912 30,271 1,051,708 978,979 3,626 33,053 117,899 178,059 140,547 133,738 338,300 360,294 Advertising and public relation 325,892 170,022 Stationery and postages Subscription and donation Insurance Repairs and maintenance Motor vehicle expenses Legal and professional fees Security Directors’ fees and expenses Oﬃce rent Depreciation Miscellaneous Bad debts Audit fees Commission Damage compensation $12,457,286 $12,171,550 62 NAWASA • ANNUAL REPORT 2018 NOTES NOTES National Water & Sewerage Authority The Carenage, St. George, Grenada, West Indies Tel: (473) 440-2155 Fax: (473) 440-4107 Email: nawasa@nawasa.gd Web: nawasa.gd