Uganda: External Auditors for Benedictine Monastery

TERMS OF REFERENCE FOR EXTERNAL AUDITORS OF BENEDICTINE MONASTERY *“Eliminating Blinding Trachoma in Uganda”*

1.BACKGROUND

The Trust funded Uganda Trachoma Elimination Programme is a 3 to 5 year programme worth approximately £974,695.45 that aims to eliminate Trachoma in Busoga and Karamoja regions by 2019. The first phase of the programme which began in April 2014 is coming to an end in March 2017. Due to a drastic reduction of targets for all expansion areas, CBM will not continue in the implementation of a second phase of the programme for purposes of cost-effectiveness.

2.PROJECT OVERVIEW

The CBM implementing partner in Uganda is the Benedictine Eye Hospital, Tororo.

Since the programme is coming to a close in 2017, an audit of the three years is required as part of the closure report submitted to the Grant Manager of the Trust programme (The Carter Centre).

1.OBJECTIVE OF THE AUDIT

Benedictine Hospital and CBM Regional Office would like to commission an audit of the “Eliminating Blinding Trachoma in Uganda” amounting to approximately £974,695.45 for the period of April 2014 to March 2017, whose objective will be;

2.1 To audit the Project Financial Statements (PFSs) to enable the auditors to express an independent professional opinion on the financial position of the project as at 31^st march, 2017 and to ensure that the funds granted to the project have been used as per the approved budget.

2.2 To review and determine if the project’s books of accounts provide the basis for preparation of the PFSs by the project, and are established to reflect the financial transactions in respect of the project.

2.3 Review and determine if the project maintains adequate internal controls and supporting documentation for all transactions.

2.RESPONSIBILITY FOR PREPARATION OF FINANCIAL STATEMENTS

3.1 The responsibility for the preparation of PFSs lies with Project which is responsible for:

a) The selection and application of accounting policies;

b) Preparation of the PFSs in accordance with the International Accounting Standards (IAS) & International Financial Reporting Standards (IFRSs) and in compliance with National Accounting Standard and Legislations;

c) Implementing accounting, administrative and financial procedures documented in manuals.

3.2 The auditors are responsible for the expression of an opinion on the PFSs based on their audit conducted in accordance with International Standards on Auditing (ISA) and National Auditing Standards and Legislation.

3.3 The auditors will provide Benedictine Monastery and CBM East Africa Regional Office with an Engagement/Confirmation Letter and Audit Program.

3.4 CBM East Africa Regional Office will provide details of all the grants or donations designated for the accounting period, specific accounting or reporting requirements and formats where applicable and any other information which the auditor/project might consider relevant for the audit.

3.SCOPE OF THE AUDIT

3.1. The audit will be carried out in accordance with the standards specified in 3.2 above and will include such tests and verification procedures as the auditors consider necessary under the circumstances. In conducting the audit, special attention should be paid to the following:

1. All donor funds have been used in accordance with the approved CBM budget;

2. Goods, works and services financed have been procured in accordance with Benedictine Monastery’s procurement manual and have been properly accounted for;

3. Appropriate supporting documents, records and books of accounts relating to all the project activities have been kept;

4. The financial statements have been prepared by the project’s management in accordance with applicable accounting standards mentioned (ref. section 3.1 above) and give a true and fair view of the financial position of the project as at 31st March, 2017;

5. Ineligible expenditures identified during the audit will be reflected in a separate paragraph of the audit report and if material, the point should be reflected in the auditors’ opinion.

6. Review the recommendations provided in the previous audit and confirm achievements and improvements on the same.

3.2. In accordance with International Standards on Auditing, the auditors shall pay attention to the following:

(a) Laws and Regulations :

In preparing the audit approach and in executing the audit procedures, the auditors shall evaluate the Benedictine Monastery compliance with the provisions of laws and regulations that might impact significantly the PFSs as required by ISA 250 (Considerations of Laws and Regulations in an Audit of Financial Statements);

(b) Governance :

Communicate significant audit issues related to governance with the persons responsible for governance at the Benedictine Monastery, in accordance with ISA 260: (Communication with those charged with Governance); and

(c) Risks :

With a view to reducing audit risks to a relatively low level, the auditors will apply appropriate audit procedures and handle anomalies/risks identified during their evaluation. This is in accordance with ISA 330 (The Auditor’s Responses to Assessed Risks).

(d) Fraud and Corruption :

In accordance with ISA 240 (The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements) the auditors shall identify and evaluate risks related to fraud, obtain or provide sufficient evidence of analysis of these risks and assess properly the risks identified or suspected;

4.AUDIT REPORT

4.1. The audit report will comprise

i) The auditors’ opinion on the project financial statements and

ii) A complete set of project’s financial statements and other relevant statements.

4.2. All ineligible expenditures will be disclosed in an annex to the audit report.

5.FINANCIAL STATEMENTS

5.1. The auditors will ensure that the PFSs are prepared in accordance with the

standards mentioned above (ref. to section 3 above) and give a true and fair view of the financial position of the project as at the fiscal year end and its receipts and expenditures for the financial year ended on that date.

5.2. The project financial statements prepared by project management shall include:

i) Fund accountability Statement of the project as at the close of the project period covering April 2014 to March, 2017;

ii) Statement of Comprehensive Income for Own and other Sources if any that relates to the project;

iii) Property, Plant and Equipment Schedule with their current value and status.

iv) Notes to the Financial Statements describing the applicable accounting policies in place and a detailed analysis of the main accounts.

6.MANAGEMENT LETTER

6.1. In addition to the audit report, the auditors will prepare a Management Letter in which they will:

i) Give comments and observations on the accounting records, procedures,

systems and controls that were examined during the course of the audit;

ii) Identify specific deficiencies and areas of weakness in the systems and controls and make recommendations for improvement;

iii) Report on the degree of compliance to all governing laws;

iv) Communicate matters that have come to their attention during the audit which might have a significant impact on the implementation and sustainability of the project; and

6.2. The Management Letter should include responses from the project’s management team on the weaknesses noted by the auditors.

7.GENERAL INFORMATION

7.1. The audit will be a tripartite engagement between the Benedictine Monastery, CBM East Africa Regional Office and the auditor.

7.2. The audit should be complete within two weeks from the start date that is, from 15^th March 2017 and the final audit report submitted to Benedictine Hospital and CBM by 10th April 2017.

The timeline for the audit process is as stated below.

a) At Benedictine Hospital the:

· On site audit of the project to end by 30^th March, 2017.

· Draft Audit Report, CBM Financial Statement and Management Letter to be received from the auditor by 31^st March, 2017.

· Final accounts and Management letter to be received from the auditor by 10^th April, 2017.

b) CBM East Africa Regional Office to be copied in the above draft and final financial reports sent to Benedictine Hospital. In addition, Benedictine Monastery will submit the Final Audit Report including the 2014-2017 CBM Financial Statement, and the Management Letter with management responses, to CBM by 14^th April, 2017.

7.3. The auditors should be given access to all legal documents, correspondence and any other information associated with the project and deemed necessary by them. Confirmation of CBM Remittances and Bank Balances should also be obtained from the bank.

7.4. It is recommended that the auditors become familiar with the following documents that may have been prepared by CBM:

1. Memorandum of Understanding;

2. Project Contract;

3. 2014 and 2017 Approved Budget;

4. Quarterly and Bi-annual narrative & financial reports submitted to CBM between the period covering April 2014 to March 2017.

8.AUDITOR’S EXPERIENCE AND QUALIFICATIONS

8.1. The audit firm should be registered and have a license from a national or regional professional Accountancy Body. The firm should have relevant experience in accounting and auditing of development projects, especially donor-funded operations.

8.2. The key audit team will comprise, at least:

a) An audit manager with at least 5 years experience in auditing and with a sound knowledge of donor-financed projects. In addition he/she should be a member of a recognized accountancy professional body.

b) An assistant auditor with adequate experience and professional qualifications.

How to apply

Interested consultants should submit the technical and financial proposals to procurement.nairobi@cbm.org before 3rd March 2017 . The email applications should clearly mark on the subject:- External Auditors for Benedictine Monastery

• The financial proposal must include all costs including professional fees and taxes to conduct the assignment;

• The technical proposal must include the profile of the company; the proposed methodology, work plan; Curriculum vitae for the person (s) proposed for the assignment and a list of similar assignments done with details of the contact person;

• Include reference numbers/ copies of support document for company registration and statutory requirements to operate in Uganda.