Sunday, February 26, 2017

TORs External Auditors of the Project Titled Citizens’ Monitoring Of the Justice Sector in Rwanda

OXFAM received funds from DFID and Oxfam Novib as part of the Security and Justice Innovation fund to implement the Citizens Monitoring of the justice sector through ICT project (ICT4J project).

The ICT4J project aimed to increase the responsiveness of Rwanda’s justice service providers towards the concerns of citizens, especially women, on the provision of justice services. The project aimed also to demonstrate that by empowering citizens to provide feedback on the quality of justice services through an innovative ICT platform, civil society would be more effective in holding justice sector duty bearers to account. It further aimed at building the capacity of civil society to shape justice sector policy and facilitate increased citizen voice in the development and reform of justice sector policies and practices.
The project was implemented by the Legal Aid Forum (LAF) from April 2015 to 15th October 2016.
The objective of the audit of the Project financial statements (PFSs) is to enable the auditors to express an independent professional opinion on the financial position of the Project from 1st November 2015 – 15th October 2016 and to indicate whether the funds granted to the project were used for their intended purposes.
The project books of accounts were the basis for preparation of the PFSs by the project implementing unit and are established to reflect the financial transactions in respect of the project. The PIU maintains adequate internal controls and supporting documentation for transactions.
The responsibility for the preparation of PFSs lies with the Project Implementation Unit (PIU) (LAF with the support and guidance from Oxfam). The PIU is also responsible for:
  • The selection and application of accounting policies: The PIU should prepare the PFSs in accordance with applicable accounting standards-either the International Public Sector Accounting Standards (IPSASs), International Financial Reporting Standards (IFRs), or National Accounting Standards that comply with IPSASs or IFRs in all material respects; and
  • Implementing accounting, administrative and financial procedures documented in the project’s operating manuals.
The audit will be carried out in accordance with International Standards of Auditing (ISA), and will include such tests and controls, as the auditor considers necessary under the circumstances.  In conducting the audit, special attention should be paid to the following:
  • DFID funds have been provided and used in accordance with the conditions of the funding agreement, with due attention to economy and efficiency and only for the purposes for which they were provided;
  • All project’s funds have been used in accordance with the conditions of the relevant financing agreements; with due attention to value for money, economy and efficiency, and only for the purposes for which the financing was provided.
  • Goods, works and services financed have been procured in accordance with the funding agreement and in accordance with the OXFAM rules and procedures, and have been properly accounted for;
  • Where separate bank accounts have been used, they have been maintained in accordance with the provisions of the relevant financing agreements;
  • The financial statements have been prepared by project management in accordance with applicable accounting standards earlier noted and give a true and fair view of the financial position of the Project as at 15th October, 2016 and of resources and expenditures for the year ended on that date;
  • Appropriate supporting documents, records and books of accounts relating to all project activities have been kept. Clear linkages should exist between the books of accounts and the financial statements presented;
  • Comprehensive assessment of the adequacy and effectiveness of the accounting and overall internal control system to monitor expenditure, other financial transactions and ensure safe custody of project-financed assets and that they are being used for the intended purposes;
  • Project’s fixed assets are real and properly evaluated and project property rights or related beneficiaries’ rights are established in accordance with grant conditions. Ineligible expenditures identified during the audit will be reflected in a separate paragraph of the audit report and if substantial, the point should be reflected in the auditors’ opinion;
  • In accordance with ISA, the auditors shall pay attention to Fraud and Corruption issues. 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;
  • In preparing the audit approach and in executing the audit procedures, the auditors shall evaluate the implementing partners (LAF)’s 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);
  • Communicate with LAF’s Management responsible for Governance regarding significant audit issues related to governance in accordance with ISA 260: (Communication with those charged with Governance); and
  • 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).
The auditors are responsible for the formulation of an opinion on the PFSs in accordance with ISAs International Standards. The auditors will not provide any other services which could result into a conflict of interest. In accordance with these standards, the auditors will request the PIU for an engagement/confirmation letter where the PIU commits to the preparation of the PFSs and maintenance of proper internal control systems as well as acceptable documentation for all financial transactions.
The auditors will ensure that the PFSs are prepared in accordance with the standards mentioned above (ref. 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.
As an annex to the financial statements mentioned above, the audit report should include:
  • Reconciliation between the amount shown as “received” and that shown as having been disbursed. The reconciliation should indicate the methods used for disbursement, i.e. bank account, direct payment or reimbursement methods with those recommended in the financing agreement; and
  • A comprehensive list of all fixed assets purchased, with given dates, values and condition of the assets.Any revenue generated by the Project e.g. sale of bid documents, disposal of project assets, bank credit interests earned on the project’s bank account and fees earned should be accounted for and disclosed.
In conjunction with the audit of the PFSs, the auditors should:
  • Audit all Statements of Expenditures (SOEs);
Determine the eligibility of expenditures in accordance with the fund agreement and appraisal report.
The audit report will comprise of:
(i) The auditors’ opinion on the project financial statements; and
(ii) A complete set of project’s financial statements and other relevant statements.  All ineligible expenditures will be disclosed in an annex to the audit report.
In addition to the audit report, the auditors will prepare a “management letter” in which they will:
  • Give comments and observations on the accounting records, procedures, systems and controls that were examined during the course of the audit;
  • Identify specific deficiencies and areas of weakness in systems and controls and make recommendations for improvement if applicable;
  • Report on the degree of compliance with each of the financial covenants on the funding agreement and give comments, if any, on internal and external matters affecting such compliance;
  • Report on the implementation status of recommendations pertaining to previous period audit reports;
  • 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
  • Highlight any other matters that the auditors consider pertinent.
Ideally, the management letter will include reactions/comments from PIUs on the weaknesses noted by the auditors (if any).
The audit report including the financial statements, the management letter including the PIU’s responses shall be submitted to the donor.
The auditors should be given access necessary legal information for the audit.
The audit firm should be registered and have a license from an international or regional professional Accountancy Body. The firm should have relevant experience in accounting and auditing of development projects, especially donor-funded operations.
The key audit team will comprise, at least:
  • 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;
  • A team leader with at least a Masters degree in auditing/accounting or equivalent with a minimum of 3 years experience in auditing; and
  • An assistant auditor with adequate experience and professional qualifications.
Applications must be in English and submitted to Oxfam Rwanda physically or electronically through the following address: or drop the application to Oxfam Rwanda Country Office by Friday 9th March 2017.

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