Final disbursement.Preparation of WA(s) for final disbursement(s) of project loan
and tranche disbursement of a policy-based loan should be closely coordinated
between ADB and the borrower and/or EA, particularly if the remaining unutilized
balance is expected to be fully utilized.
4.17 Winding-up period.10
The borrower may make withdrawals from the loan account
for expenditures incurred on or before the loan closing date. Expenditures incurred
after the loan closing date will not be financed under the loan. ADB may allow up to
4 months after the loan closing date (i) for the borrower’s WAs to be submitted to ADB
for expenditures incurred on or before the loan closing date, and (ii) for the borrower
to fully liquidate expenditures incurred on or before the loan closing date. After the
winding-up period, WAs, including requests for liquidation, will not be accepted.
Extension of the winding-up period, on an exceptional basis, may be approved by ADB
(Section 4.14).
4.18 Within 2 months after the winding-up period for submission of documents, the
borrower should fully refund any outstanding imprest account balances to ADB. If the
borrower fails to fully refund such balances, ADB may, among other corrective actions,
decide not to allow the use of the imprest fund procedure under the borrower’s new
projects until such time as the refund is received.
4.19 Payment of final audit fees.If external auditor’s fees are financed by ADB, it is
best practice to pay the audit fee before the loan closing date after completing the
final audit (Section 4.15). When audit fees under a project need to be paid after the
closing date, special arrangements may be required for payment of the final audit fee
from the loan account. External auditor’s fees for the final fiscal year may be disbursed
from the loan account, under condition that (i) the borrower signs a contract for the
final audit prior to the loan closing date, and (ii) the contract is a lump-sum or fixedprice contract that requires completion
11
of audit within 6 months after the loan
closing date. If the audit work cannot be completed during the winding-up period, and
the final audit fee will be paid through the escrow account, full supporting documents
should be attached to the WA (see Appendix 4D for more details).
4.20 Refunds.All refunds must be paid to ADB’s accounts at its depository banks with
payment details indicating (i) references such as loan number, (ii) description or
nature of the refund, and (iii) currency and amount of refund. The borrower and/or
EA should send advice to ADB’s Treasury Services Division (TDTS) and CTLA once
a refund is made.

commercial bank for payments made or to be made to a supplier against

5:23 PM    

Four Major Types
6.1  Procedures for withdrawal of loan proceeds are standardized to facilitate
disbursements under most loans. There are four major types of disbursement
procedure, described briefly as follows:
 direct payment procedure, where the Asian Development Bank (ADB), at the
borrower’s
1
request, pays a designated beneficiary directly (Chapter 7);
 commitment procedure, where ADB, at the borrower’s request, provides an
irrevocable undertaking to reimburse a commercial bank for payments made
or to be made to a supplier against a letter of credit (LC) financed from the loan
account (Chapter 8);
 reimbursement procedure, where ADB pays from the loan account to the
borrower’s account for eligible expenditures which have been incurred and paid
for by the project out of its budget allocation or its own resources (Chapter 9);
and
 imprest fund procedure, where ADB makes an advance disbursement from the
loan account for deposit to an imprest account to be used exclusively for ADB’s
share of eligible expenditures (Chapter 10).
Simplified Documentation under the Reimbursement Procedure
6.2  While normally ADB requires submission of full supporting documentation, there are
special cases where it accepts simplified documentation procedures:
 the statement of expenditures (SOE) procedure involves the borrower submitting
a SOE to support an application (Sections 9.9–9.25), and
 the force account works procedure involves the borrower submitting periodic
certification of the progress or completion of civil works in support of its
application for reimbursement (Sections 9.26–9.30).

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