PROGRAM AUDIT OF SELECTED CONTRACTS IN SENEGAL

The objective of this audit is to provide the NI with an independent verification of contracts held with government entities as outlined in the schedule below:

1. La Direction de la Santé de la Mère et de l’Enfant
   • Contract Number: 10-2050-DSRSEN
   • Contract Amount: XOF 49,130,880
   • Project Period: Jul 2020 to May 2021
2. La Service National de l’Education et de l’Information pour la Santé
   • Contract Number: 10-2144-SERNAT-02
   • Contract Amount: XOF 24,356,000
   • Project Period: Sep 2020 to Aug 2021
3. Cellule de Lutte Contre la Malnutrition
   • *Contract Number:*10-2144-CELMAL-03
   • Contract Amount: XOF 70,037,909.93
   • Project Period: Nov 2020 to Jul 2021

1. Scope of Work

The engagement shall be planned in accordance with:

i. these Terms of Reference.

ii. the International Standard on Related Services (“ISRS”) 4400 Engagements to perform Agreed-upon Procedures regarding Financial Information edited by IFAC; and

iii. the Code of Ethics for Professional Accountants, published by IFAC. Although the ISRS 4400 does not provide independence as a criterion for agreed engagements, the contracting authority imposes an obligation on the auditor to comply with the independence requirements of the Code of Ethics for Professional Accountants.

The audit is planned to ensure that effective expenditure verification can be performed, by designing and carrying out verification in accordance with the audit objectives and procedures outlined below:

2. Procedures

General Procedures

1. Obtain sufficient understanding of the project and of the terms and conditions of the contract by reviewing the contract and other relevant information and by inquiry of the partner. The auditor will review the final technical report and financial statement of the partner.

2. Verify that the financial statement complies with the conditions of the contract.

3. Examine whether the partner has complied with generally accepted accounting policy (IFRS or local GAAP) as applicable in the country.

4. Reconcile the financial statement to the accounting system and records (trial balance, general ledger, sub-ledgers, etc.)

5. Verify that appropriate exchange rates have been applied for currency conversions.

Analytical Review

1. Cary out an analytical review of the expenditure categories in the financial statement, verifying that the budget corresponds with the contract and any amendments that the expenditure incurred was foreseen in the budget and that the total claimed does not exceed the contract maximum.

Expenditure Verification

Select items for verification to obtain an Expenditure Coverage Ratio (“ECR”) of 65%. ECR is equal to the total amount of expenditure verified expressed as a percentage of the total amount of expenditure reported in the financial statement. If the exception rate found is greater than 2%, verification procedures are extended to an ECR of 85%. The auditor should ensure a systematic and representative verification of an expenditure category, but may obtain satisfactory verification results by looking at a limited number of selected items.

1. Select items for verification using value as a primary factor; selecting high value items to ensure appropriate coverage of expenditure.

2. The auditor shall use their judgement to select specific items or classes of expenditure items. The auditor may apply factors such as their knowledge of the activities of the project, the activities and characteristics of expenditure categories, the inherent nature of expenditure categories as risky or error prone, or unusual items.

3. The auditor verifies the expenditure and reports all exceptions resulting from this verification. Verification exceptions are all verification deviations found when performing the procedures and must be set out in an Annex to the Auditor’s report. In all cases the Auditor reports all exceptions found including the ones which he cannot measure the financial impact.

4. The auditor verifies that the expenditure has been accurately and properly recorded in the accounting system and financial statement and that it is supported by appropriate evidence and supporting documents. This includes proper valuation and the use of correct exchange rates. The auditor verifies that costs are:

a) Eligible in accordance with the terms and conditions of the contract;

b) Necessary for carrying out the project activities – i.e. incurred for the intended purpose of the work;

c) Comply with the principles of sound financial management including value for money and cost effectiveness;

d) Have actually been incurred during the contract period;

e) Are recorded in the books of account and are identifiable, verifiable and substantiated by originals of supporting evidence.

1. The auditor verifies that expenditure for a transaction has been classified under the correct category and subcategory of the financial statement.

2. The auditor exercise professional judgement to obtain sufficient appropriate verification evidence as to whether the expenditure has occurred (reality and quality of the expenditure) and – where applicable – assets exist. The auditor verifies the reality and quality of the expenditure for a transaction or activity by examining proof of work done, goods received or services rendered on a timely basis, at acceptable and agreed quality and at reasonable prices or costs.

3. The auditor verifies receipts from NI that have been declared in the financial statement.

3. Reporting

The auditor must deliver the following reports:

1. Report on Factual Findings.

The report should describe the purpose, the agreed-upon procedures of the engagement, and factual findings of the procedures and details of all exceptions. The format of the report is included in Attachment B.

1. Financial Statement

The financial statement shall include the original financial statement as submitted, a breakdown of ineligible expenses and the final financial statement subsequent to the verification. The format of the report is included in Attachment B.

1. Internal Control Memorandum

A management report regarding internal controls of the organization, including weaknesses identified, recommendations and management’s comments.

4. Timeframe

The audit work should be completed according to the following time frame:

• Start of Audit Work: 2^nd May 2022

• Complete the Audit work: 20^th May 2022

• Submission of Draft Reports to NI: 27^th May 2022

• Review of audit report FD, CD, RD: 6^th Jun 2022

• Submission of Final Reports: 17^th Jun 2022

5. Attachment B – Reporting Templates

Report on Factual Findings

Introduction

This section should include a summary of the engagement, objective and scope of work.

Project Activities

This section should include a brief description of the work program and contract, the beneficiary and key financial or budget information.

Procedures Performed and Factual Findings

Describe the results of the procedures performed. Use supporting tables or schedules as Annexes to the report, if applicable. Provide details of all exceptions.

PROPOSAL EVALUATION/ SELECTION CRITERIA

6. Mandatory Requirements.

Interested firms are required to submit the below listed documentation together with their detailed price quotation**:**

a) Registration Certificate

b) Tax Registration Certificate**

c) Copy of practicing License from a professional body.**

7. Technical Proposal Requirements

To be consider for award, interested and eligible firms must submit the following:

a) At least two copies of recent valid contracts/ engagement letters for similar assignments with a reputable INGOs or Government institutions.

b) Reference letters form the two institutions whose contracts/engagement letters are submitted in a)

c) List of proposed technical staff to work on the assignment (include their professional experience and Academic/professional qualifications).

d) Detailed Audit-Workplan detailing when each activity will be completed.

e) Provide signed Copies of Audited Accounts for the previous two years.

8. Financial Proposal Requirements

Financial Proposal (in Excel) which must include the following:**

a) Fees charged for the services

b) List of any proposed reimbursable expenses to be incurred

c) Value Added Tax