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  • Terms of Reference for SADC/SIDA HIV AUDIT

    Terms of Reference - SADC HIV and AIDS Business Plan Audit

    SIDA Supported

     

    1. Introduction

    1.1 Brief background information:

    The SADC Secretariat with support from various International Cooperating Partners (ICPs) is implementing the 2010-15 SADC HIV and AIDS Business Plan.

    The objective of the SADC HIV and AIDS Programme (2010-15) are to;

    • facilitate all Member States to deliver on their universal access to prevention targets by 2015;

    • facilitate all Member States to deliver on their universal access targets to achieve access to quality treatment for people living with and affected by HIV, AIDS and TB by 2015;

    • reduce the impact of HIV and AIDS on the socio-economic and psychological development of the SADC Region, Member States, communities and individuals with all orphans, vulnerable children and youth having access to external support by 2015;

    • mobilise sufficient resources for a sustainable scaled-up multi-sectorial response to HIV and AIDS in the SADC Region that channels resources to operational and community levels; and

    • enhance institutional capacity in the SADC Region and support evidence-based programme design, implementation, monitoring and evaluation at regional and Member States levels to support progress towards regional, continental and global commitments.

    1.2 The SADC Secretariat developed a SADC HIV and AIDS Implementation Plan (2010-15) as a tool to operationalize and realize the objectives of the Programme. The Implementation Plan (IP) provides detailed intervention areas and the expected resource needs for each of the five objectives.

    1.3 The Government of Sweden, through the Swedish International Development Agency (Sida), is the major and lead ICP channelling resources directly to the SADC Secretariat to support the implementation of the Programme with an average annual disbursement of US$1.2 million over a five year period.

    1.4 The SADC Secretariat now wishes to engage the services of a reputable audit firm for the purpose of auditing the Sida funded operations of the SADC HIV and AIDS 2010-15 Business Plan for the three financial years ending 31 March 2013, 2014 and 2015, as stipulated in the agreement between SADC and Sweden.

    1.5 The audit shall be carried out in accordance with international audit standards issued by the International Federation of Accountants (IFAC). The audit shall be carried out by an external, independent and qualified auditor (Certified Public Accountant/Authorized Public Accountant).

    2. Objectives and scope of the audit

    2.1 Conduct an audit of the Financial Report for each of the years covering the period April 2012 to March 2013, April 2013 to March 2014 and April 2014 to March 2015. In each of the annual audits the auditor should express an audit opinion in accordance with the International Standards on Auditing (ISA) 800/805 on whether the Financial Reports of the SADC HIV and AIDS 2010-15 Business Plan implementation Programme submitted to the donors are in accordance with SADC Secretariat’s accounting records, agreed budget and Sida’s requirements for financial reporting.

    2.2 Examine, assess and report on compliance with the terms and conditions of the bilateral agreement between the SADC Secretariat and the Government of Sweden and applicable laws and regulations regarding accounting and taxes.

    2.3 Examine, assess if project/bank funds have been used in accordance with the conditions of the agreement, with due attention to economy and efficiency and only for the purposes for which the funds were provided.

    2.4 The auditor shall examine on a test basis that there is supporting documentation related to reported expenditure. The size of the test shall be based on the auditor’s risk analysis and that should be stated in the report. The auditor shall report the identified amount in case there is any missing supporting documentation.

    2.5. In reporting, the auditor shall examine, assess and ensure that the organisation reporting is based on actual expenses incurred for project activities only and is not done on allocation or apportionment basis.

    2.6 If SADC channel funds to other organisations the auditor shall examine if SADC has followed Sida´s audit requirements in the next step and have satisfying routines/resources for acting on received audit reports from these organisations. In addition, the auditor shall examine on a test basis that there is supporting documentation related to reported expenditure of funds channelled to other organisations.

    3. Reporting

    3.1 Financial report

    3.1.1 When accrual basis accounting method is used, the Financial Report shall include:

    • Income statement (or statement of comprehensive income, or income and expenditure )

    - The income statement should show separately

    a) Funds received during the period
    b) Funds brought forward
    c) Bank interest income
    d) Other income
    e) Exchange gains
    f) Unspent funds

    • Balance sheet showing accumulated funds of the project, bank balances and other assets and liabilities of the project

    • Cash flow statement

    • Notes to the financial report describing the applicable accounting principles in place and detailed analysis of the Income statement and balance sheet.

    As an annex to the financial report mentioned above, the audit report should include:

    • A comprehensive list of all fixed assets purchased during the year, with given date, values and conditions of the assets.

    • The financial report shall include an appendix of actual income and expenditure compared to budget and variances with brief comments.

    OR

    3.1.2 When cash basis accounting method is used, the Fund accountability statement report shall include:

    • Fund accountability statement report (showing receipts, expenses and surplus /deficit for the period)

    - The Fund accountability statement report should show separately

    a) Funds received during the period
    b) Funds brought forward
    c) Bank interest income
    d) Other income
    e) Exchange gains
    f) Unspent funds

    -The Fund accountability statement report should also include fund balance represented by: (showing cash, bank, advances, receivables, payables etc.)

    • Cash flow statement

    • Notes to the Fund accountability statement report describing the applicable accounting principles in place and detailed analysis of the Fund accountability statement

    As an annex to the Fund accountability statement report mentioned above, the audit report should include:

    • A comprehensive list of all fixed assets purchased during the year, with given date, values and conditions of the assets.

    • The financial statements shall include an appendix of Actual income and expenditure compared to budget and variances with brief comments.

    3.1.3 The report shall only include financial information that has been audited by the auditors. (Under no circumstances shall the audit report include any page of unaudited financial information as part of the Audited financial report).

    3.2 Management Letter report

    3.2.1 The auditor shall submit an audit memorandum/management letter, which shall contain the audit findings made during the audit process. The audit memorandum/management letter shall state the progress and which measures that have been taken as a result of findings /recommendations arising from the previous audits and whether measures taken have been adequate to deal with reported shortcomings. The report shall include clear recommendations, prioritised in order of importance. It shall include a discussion on the chosen method and include the following headings:

    - Observations
    - Risk
    - Recommendations
    - Implementation status of previous audits’ recommendations.
    - Management Response
    - Action plan (with deadlines)

    3.2.2 The auditor´s report shall contain details regarding the audit method used and the scope of the audit.

    3.2.3 The report shall contain an assurance that the audit was performed in accordance with international standards and by a qualified auditor.

    3.2.4 The report shall contain the responsible auditor’s signature (not just the audit firm) and title.

    3.2.5  The report shall be written in English and presented to the SADC Secretariat no later than 30th June 2013,2014 and 2015.

    Download the format of the technical and financial proposal