Request for proposal for auditing Services
Date: 11th Nov 2020
To: Qualified Firms of Certified Accountants
From: FCA Somalia
Subject: Professional Auditing Service for SSF funded project for the period of 1st Aug, 2018 – June 30, 2020.
FCA is soliciting proposals from qualified firms of certified public accountants to conduct an audit for one of it’s projects for 1st Aug, 2018 – June 30, 2020. . Note: audit conditions are listed below on this TOR.
FCA works to enable people to break the circle of poverty and violence. We are a rights-based actor, a Finnish organization with 70 years of experience, with operations in 15 countries. FCA is Finland’s largest NGO in development cooperation and second largest provider of disaster relief. Our action is guided by international human rights standards and principles. We realize our mission and vision through development cooperation, humanitarian assistance and advocacy work. We contribute to positive change by supporting people in the most vulnerable situations within fragile and disaster-affected areas. We consider three thematic areas as central to sustainable change: the right to peace (R2P), livelihood (R2L) and quality education (R2QE).
In Somalia and Somaliland FCA has been working under a right to peace thematic areas since 2008 including governance and reconciliation projects and later has expanded in quality education (R2QE) thematic area.
SCOPE AND LOCATION OF AUDITING
The auditing shall be conducted at the location of the projects, in particular at the place where the projects’ bookkeeping are done, to be selected by the Auditors. FCA has two offices: In Baidoa, Mogadishu and Hargeisa. It’s up to the auditor to select the place for conducting the audit. The audit to be conducted is the project audit for the period of 2 years. Total approximate expense for the project period in Somalia is 1,200,000 US dollars.
In order to simplify the evaluation process and obtain maximum comparability, FCA requires that all responses to the RFP be organized in the manner and format described below:
- Evidence showing Min 2 years’ experience of INGO audit.
- Certificate of incorporation as Certified Public accountant (CPA)
- Evidence showing minimum one audit experience with International Standard on Related Services (ISRS) 4400 standard on related services – provide service completion report for the Agreed Upon Procedures (AUP) done in accordance with standard ISRS 4400
- Evidence showing minimum one audit experience in auditing project funded by International Institutional donors (such as but not limited to Finland MFA, ECHO, EU,SSF, and UN Agencies).
- Executive Summary
Describe your understanding of the work to be performed and your firm’s ability to perform the work within the time fame provided.
- Professional Experience
Describe how and why your firm is different from other firms being considered. This should include an explanation of the firm’s philosophy, size, structure, and qualifications with serving not for profit organizations with a similar size and operations. Describe your firm’s resources devoted to not for profit organizations and provide copies of newsletters or other resource materials addressing issues relevant to not for profit organizations. Discuss the firm’s independence with respect to FCA.
- Team Qualifications
Identify the specific partners, managers, and in-charge staff who will be assigned to this engagement if you are successful in your bid. Provide their bios specifying relevant experience to the type of services requested. Also discuss commitments you make to staff continuity, including your staff turnover experience in the last three years.
- Audit Approach
Describe how your firm will approach the proposed services, including the use of affiliates or staff from other locations, areas that will receive primary emphasis, and the type of assistance that will be required from FCA’s staff. Also discuss the firm’s use of technology. Finally, discuss the communication process used by the firm to discuss issues with management.
Please provide a firm estimate of fees for the services to be provided
Any cost incurred for traveling to provinces must be bearded by audit firm. Additionally, transportation for auditors to FCA office must be provided by audit firm.
- Client References
Include a list of the relevant non for profit clients the firm has served within the past three years and furnish the names and telephone numbers of any references whom we may contact.
|1||Number of years of, exceeding 3 years, Experience in INGO’s Audit.||10%||Compared with the other offers. Longest experience receives highest score.Other candidates’ scores are calculated proportionally based on the longest years of experience.|
|2||Experience in auditing project funded by International institutional donors.||30%||Full score for 5 or more previous assignments with evidence of service completion reports or Certificate of successful completion. And the below calculation for the less number of the reports
|3||Financial score.||50%||Lowest bid receives highest score. Other candidates’ scores are calculated proportionally based on the lowest bid.|
|4||Experience with standard on related services 4400 (10%).||10%||Full score for five or more previous assignments conducted under ISRS 4400 with evidence of service completion reports.And the below calculation for the less number of the reports
AUDIT PROPOSAL INFORMATION
The proposal must be valid for at least 60 Days. The final decision of the selection of the firm to conduct the audit will be made by the FCA procurement committee in coordination with FCA HO. All questions and correspondence regarding this RFP should be directed to procurement committee through email email@example.com.The audit instructions for this specific project is at the bottom of this RFP. DELIVERABLES Prior to the submission of the completed audit report the audit firm will be required to deliver and review the draft and the proposed management letter with the FCA Somalia. Copies required A) Audited Financial Statements, 3 copies. B) Management letter, 3 copies. SUBMISSION GUIDELINE: The proposals must be submitted electronically at email: firstname.lastname@example.org. The subject line must be: FCA/SOCO/11948/ Project Audit.
Deadline: 19th Nov, 2020 before 4:00 EAT PM.
Audit instructions (Appendix A) / Audit report
Audit report to AAA (NGO)
I have audited the costs arising from a humanitarian operation (Name of Operation) carried out by (Name of Organisation) during the period from X—X. The reported costs amount to EUR XX XXX.
(Mr/Ms Name), who is in charge of the operation in question, has prepared the final report and produced the appended breakdown of costs.
The audit has been performed in accordance with the audit instructions concerning humanitarian support granted by the Ministry for Foreign Affairs and, as appropriate, following the international audit standards. According to recommendations, audits are planned and performed in order to obtain sufficient certainty of whether the audited final report and its breakdown of costs include essential mistakes or defects. Auditing involves reviewing of materials that form the basis of the figures and other data presented in the final report and breakdown of costs. The grounds for and graphic and other ways of presentation of the final report and breakdown of costs are also assessed.
The following observations were made during the audit:
Place and date
Printed name and authorisation
Project audit instructions (Appendix B)
Auditing instructions for auditors in the country of operation
The instructions have been prepared in English in order to simplify working with partners of cooperation, The scope and content of the audit in the country of operation must cover at least the measures that are mentioned in this instruction.
Audit instructions for a humanitarian operation whose financial support is channelled through a non-governmental organisation in Finland
We ask you to conduct a Special Purpose Audit concerning the Humanitarian Operation (Name of Operation) of (Organisation)
According to the Ministry for Foreign Affairs of Finland’s financial guidelines regarding humanitarian support to non-governmental organisations, the receiving organisation must observe principles related to good governance and anti-corruption activities. State support shall be used only to cover expenses considered to be necessary and reasonable in carrying out the operation activities. The support receiving organisation shall in its accounting follow the generally accepted national accounting principles (GAAP). The audit should be carried out in accordance with International Standards on Auditing as applicable and relevant national legislation and standards.
The nature of a humanitarian operation is as follows:
- A operation is not a legal entity but an accounting subject
- It can include transactions in more than one legal entity (e.g. partner or subsidiary)
- It does not prepare statutory Financial Statements
- The statements under audit are the Financial Report and the List of Fixed Assets
- Fixed Assets are not capitalized but recorded as cost when purchased
- The Materiality Level in each audit finding is the equivalent of 200 Euros.
We ask you to further send the Auditor’s Report to the co-operation partner in Finland both by email and by regular mail
The report has to be in English and include the following items:
- Operation’s identification (number, name, etc.)
- Implementing organisation
- Date of the grant decision
- Reporting period and currency
- Exchange rate used in the Financial Report
- Total amount of budgeted income and expenditures
- Total amount of actual income and expenditures
- Closing balance (including cash, bank and other assets like advance payments and outstanding checks)
- Auditor’s name, position, address, phone, fax and e-mail
- Date, auditor’s signature and authorization
- Opinion on the issues below
The Auditor’s Report offers an opinion on the following areas:
- Does the Financial Report match with the Bookkeeping?
- Does the Financial Report correspond with the grant decision?
- Do the received funds match with the Bookkeeping?
- Does the Bookkeeping match with the Vouchers?
- Are the expenses acceptable?
- Are there proper Vouchers far the transactions?
- Is there an adequate Bookkeeping, including Journal and General. Ledger?
- Do the changes in the List of Fixed Assets match with the Vouchers?
- Does the Bookkeeping match with the Official Bank Account Statements and Cash Book?
- Does the opening balance of funds correspond with the audit report of previous year?
- Is the approved Financial Report free of material misstatement?
- Are the received, unused funds properly recorded as a liability in the balance sheet and included in the ending balance of the Financial Report?
- Are the recorded expenses in the Financial Report in line with the approved original budget and activity plan?
- The report should contain explanations of deviations larger than 15 percent
- Is the internal control system of the organisation in place?
- Are there any material weaknesses that the organisation should improve?
- Close assessment of the risk management?
- Do the salaries of the project personnel match with existing properly signed employment contracts and does working time recording exist?
- Has social security expenses including pensions and taxes been recorded and paid to relevant authorities in accordance with the national legislation?
- Does the organisation have copies of all valid essential contracts (government, trading, rental, lease, service agreement)?
In conclusion, estimate how the objectives have been reached?
Templates of Engagement Letter and Auditor’s Report are attached to this Audit Instructions. We ask you to further send the Auditor’s Report to the co-operation partner in Finland by email and submit the original to the Country Office. The Agreed-upon Procedures are listed in the template of the Auditor’s Report. The report has to be in English (or in another language exceptionally agreed with the Finnish partner organization) and include the findings of all of the agreed-upon procedures. ISRS 4400 report is not meant to be a standard report so each auditor should in any case adjust the report to reflect the procedures carried out and the observations made during the procedures.
FCA practices zero tolerance against concerning aid diversion and illegal actions and may screen [contractor/external party name] (í.e. applicants, contracts, suppliers, consultants, etc.) against international lists to ensure due diligence and compliance with Anti-money laundering and Combating the Financing of terrorism requirements). FCA’s Child Safeguarding Policy applies to all FCA staff.