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Tender title: Call for proposals “Annual Project External Audit 1st January 2024- 31st December 2024”

Project Name: Reinforcing Community Capacity for Social Cohesion through Societal Trauma Healing in Rwanda’

Funder: SIDA

Sida’s Standard Terms of Reference for Annual Audit of Project/Programme Support including ISRS 4400 (Revised)

Introduction

Interpeace hereafter referred to as the “Cooperation partner” wishes to engage the services of an audit firm for the purpose of auditing the program ‘Reinforcing Community Capacity for Social Cohesion through Societal Trauma Healing in Rwanda’, as stipulated in the agreement between the Cooperation partner and Sida. The audit shall be carried out in accordance with international audit standards (ISA) issued by IAASB[1]. In addition, an assignment according to International Standards on Related Services (ISRS) 4400 (Revised) shall be carried out. The audit and the additional assignment shall be carried out by an external, independent and qualified auditor.

Objectives and scope of the audit

The objective is to audit the financial report for the period 01 January 2024 to 31 December 2024 with approx. budget of USD 1.5M , as submitted to Sida and to express an audit opinion according to ISA, applying ISA 800/ISA 805, on whether the financial report of the program ‘Reinforcing Community Capacity for Social Cohesion through Societal Trauma Healing in Rwanda’ is in accordance with the Cooperation partner´s accounting records and Sida’s requirements for financial reporting as stipulated in the agreement including appendices between Sida and Cooperation partner (Agreement).

Additional assignment; according to agree upon procedures ISRS 4400 (Revised), review the following areas in accordance with the Terms of Reference below

Mandatory procedures that must be included:

  1. Observe whether the financial report is structured in a way that allows for direct comparison with the latest approved budget[2]
  2. Observe and inspect whether the financial report provides information regarding:
  3. Financial outcome per budget line (both incomes and costs) for the reporting period and columns for cumulative information regarding earlier periods under current agreement.
  4. When applicable, compare if the opening fund balance[3] for the reporting period matches with what was stated as closing fund balance in the previous reporting period.
  5. A disclosure of exchange gains/losses. Inquire and confirm whether the disclosure includes the entire chain of currency exchange from Sida’s disbursement to the handling of the project/programme within the organization in local currency/ies, if applicable.
  6. Explanatory notes (such as, for instance, accounting principles applied for the financial report).
  7. Amount of funds that has been forwarded to implementing partners, when applicable.
  8. Inquire and inspect with what frequency salary costs during the reporting period are debited to the project/programme.

Choose a sample of three individuals for three different months and:

  1. Inquire and inspect whether there are supporting documentation[4] for debited salary costs.
  2. Inquire and inspect whether actual time worked is documented and verified by a manager. Inquire and inspect within which frequency reconciliations between debited time and actual worked time is performed.
  3. Inspect whether the Cooperation partner comply with applicable tax legislation with regard to personal income taxes (PAYE)[5] and social security fees.
  4. Review and confirm that the Cooperation partner screens IP’s and/or suppliers to ensure that such parties are not subject to the European Union’s financial sanctions list of persons, groups and organisations (EU Sanctions list).

Enquire whether there has been any reported findings from the screening process and if so, report on such findings.

  1. Inspect and confirm that the unspent fund balance (according to the financial report) at the end of the financial year is in line with information provided in the accounting system and/or bank account.
  2. Applicable the final year: Inspect and confirm the unspent fund balance (including exchange gains) in the financial report and confirm the amount that shall be repaid to Sida.

Follow up of funds that are channeled to implementing partners

Mandatory assignments that must be included if the Cooperation partner forward funds to implementing partners (IP’s):

Choose a sample of a minimum of 30 % of the total of disbursed funds as well as 40 % of the number of IP’s or a maximum of 10 IP’s.

  1. Inspect and confirm whether the Cooperation partner has signed agreements with the selected IP’s.
  2. Inspect and confirm whether the Cooperation partner, in all agreements entered with IP’s, included the requirement to carry out annual audits. The requirement shall specify that these audits shall be carried out with application of ISA (reporting according to ISA 800/805) and a separate assignment according to ISRS 4400 (Revised) should be included for project/programme support. If agreements regarding core support are entered into with IP’s, the audit shall be conducted in accordance with ISA 700 or National standards on auditing.
  3. Inquire and inspect whether the Cooperation partner has received financial reports and auditor reports from all IP’s included in the selected sample:
  4. Inquire and inspect whether the Cooperation partner has verified if reports from IP’s are in line with the requirements in the Agreement.
  5. Inquire and inspect whether the Cooperation partner has documented its assessment of the submitted financial reports and reporting from auditors including management responses and action plans from selected IP’s.
  6. Inquire and inspect whether the Cooperation partner has documented its follow-up actions based on the information provided in the financial reports and the reporting from the auditor of the selected IP’s.
  7. Inquire and inspect whether the Cooperation partner has reported substantial observations[6] from selected IP’s audit reports in its communication with Sida. List observations[7] from IP’s audit reports which have been part of this sample.

III. The reporting

The reporting shall be signed by the responsible auditor (not just the audit firm[8]) and shall include the title of the responsible auditor.

Reporting from the ISA assignment

The reporting from the auditor shall include an independent auditor’s report in accordance with the format in standard ISA 800/805 and the auditor’s opinion shall be clearly stated. The financial report that has been the subject of the audit shall be attached to the audit report.

The reporting shall also include a Management letter that discloses all audit findings, as well as weaknesses identified during the audit process. The auditor shall make recommendations to address the identified findings and weaknesses. The recommendations shall be presented in priority order and with a risk classification.

Measures taken by the Cooperation partner to address weaknesses identified in previous audits shall also be presented in the Management Letter. If the previous audit did not have any findings or weaknesses to be followed-up on, a clarification of this must be disclosed in the audit reporting.

If the auditor assesses that no findings or weaknesses have been identified during the audit that would result in a Management Letter, an explanation of this assessment must be disclosed in the audit reporting.

Reporting from the ISRS 4400 (Revised) assignment

The additional assignment according to agreed upon procedures ISRS 4400 (Revised) under section II, shall be reported separately in an “Agreed-upon procedures report”.

Performed procedures should be described and the findings should be reported in accordance with the requirements in the International Standard on Related Services 4400 (Revised).

When applicable, the sample size shall be stated in the report.

Period of Performance:

The period of performance for this Audit is for one month from the audit contract date.

Payment: Audit fees will be paid in instalments where 50% of the amount at submission of the draft audit report and final 50% once the audit is completed and the final audit report is received.

Evaluation Criteria:

Award criteria

Award of the contract will be based on the following criteria:

Essential Criteria:

Bidders must meet the following criteria:

Bidder’s confirmation of compliance with the Anti-Bribery and Corruption Policy, Child Safeguarding Policy.

The bidders MUST provide the following document evidencing eligibility.

  • Copy of certificate of incorporation or registration
  • Copy of valid trading license 2024
  • Copy of certificate of e-tax registration or evidence of tax registration with RRA
  • E-Tax clearance certificate for the period FY2024

Criteria of evaluation as a whole

The Offeror’s submitted Technical Approach / Performance Work Statement (PWS) will be evaluated as below.

Summary of the proposals’ technical assessment forms

Grade coefficient

Maximum grade

1

Past Performance

25%

25

2

References

25%

25

3

Relevant experience with International NGOs

10%

10

4

Reasonableness of Level of Effort

20%

20

5

Reasonableness of proposed method

20%

20

Total

100

This RFP in no way obligates Interpeace Rwanda to award a contract, nor does it commit Interpeace Rwanda to pay any costs incurred in the preparation and submission of the proposal.

Bidding documents must properly binded , printed and submitted in 02 copies of which, one is original and 01 copy conforming to the original. Bids in sealed envelopes must be addressed and submitted to Interpeace office located at Kimihurura ,KG 2 Ave, 15 Kigali, Rwanda by 19th January 2025 at 10:00 am. Late bids shall be rejected and returned unopened.

The opening of bids will take place on the same day of submission of bids in the presence of bidders or their representatives who choose to attend from 10:30 am

Data and Facilities to be provided by the Client

Interpeace will provide the Auditors with office space during the field audit and also ensure full access to the organizations and project records and documents, contract documents, books of account, correspondences and any other relevant information for the year under review.

Yours sincerely,

Kayitare Frank

Country Representative

[1] The International Auditing and Assurance Standards Board (IAASB)

Template case no: 23/000790 Department: VERKSTOD/JUR Other:

Version no: 1.3 Date: 20230428 Other:

[2] The budget is attached to the agreement with Sida as an annex and any updates should be supported by a written approval by Sida.

[3] I.e. funds remaining from disbursements made during previous reporting period/s

[4] Debited salary costs should be verified by supporting documentation such as employment contracts.

[5] Pay As You Earn

[6] Deemed substantial by the Cooperation partner.

[7] Observations included in Management Letters and if applicable, qualified audit reports.