External Auditing Services 277 views0 applications

Request for Proposal to provide External Auditing Services

1. Background to DSW Kenya

Deutsche Stiftung Weltbevblkerung (DSW) is an international development organization that focuses on the needs and potential of the largest youth generation in history. We are committed to creating demand for and access to health information, services and supplies, and to securing their right for a brighter future. We achieve this by engaging in advocacy, capacity development, and family planning initiatives, which make sure the youth of today, are empowered to lead healthy and self-determined lives. With our headquarters in Hannover, Germany, DSW maintains country offices in Ethiopia, Kenya & Tanzania and works through a partner organization in Uganda. Additionally, DSW has liaison offices in Berlin and Brussels.

Deutsche Stiftung Weltbevblkerung (DSW) Kenya was registered in 2000 under the NGO Coordination Act of 1990 in Kenya.

In carrying out its mandate, DSW Kenya has a presence in at least 12 counties directly implementing programs with funding from donors and at the same time implements programs jointly with other partners. This work is informed by a 5-year strategic plan (2018- 2022). DSW Kenya has its head office in Nairobi with satellite offices in Mombasa and Kitale.

DSW’s financial year runs from 1 January to 31 December. The turnover for the year 2020 was €1.196 million.

DSW Kenya is seeking to recruit an external Auditor for a maximum of two terms of three years each depending on performance.

2. Scope of work

The successful bidder will be required to perform the annual statutory financial audit for the period, January to December in respect to relevant pre- determined objectives before end of February following the end of the financial year.

Duties of the Auditor

• Express a professional opinion on financial statements of DSW Kenya on whether the statements present, in all material aspects, the financial position at the end of each financial year and were prepared in accordance with recognized accounting principles, standards and all relevant laws and regulations.

• Confirm that the books of account provide the basis for preparation of the financial statements

• Review and give an opinion on the adequacy and effectiveness of the risk management system, internal controls, financial management practices and supporting documents maintained by DSW Kenya

• Review and give an opinion on adequacy, transparency and fairness of the procurement processes as employed by DSW Kenya

• The existence /effectiveness of organizational /personnel policies and procedures designed to ensure the regularity of the rendering of the accounts and to prevent losses of monies and/or property,

• Means of verification of the correct allocation of expenses to projects

• Review and give an opinion on adherence by DSW Kenya to national laws, its own internal controls and funding partner’s agreements

• Verify the costs for personnel in consideration of its allocation to projects, the completeness and accuracy,

• Review of partner/project agreements.

• Provide recommendation for improvements on any inadequate process or practice employed by DSW Kenya as will be noted during the audit exercise by providing DSW Kenya with a Management letter

• Provide necessary assurances to DSW Kenya’s external parties seeking to authenticate either the process or output of the audit undertaking.

• Conduct entry and exit meeting with the Country Director of DSW Kenya.

• Conduct interim audits under the request of DSW on need basis.

• The audit period should cover visits to sampled project sites from which a report is submitted with key findings and recommendations.

3. Technical requirements

In the bids, the tenderers are expected to:

• Provide an exposition of their technical expertise in audit and advisory services

• the audit firms could include in their proposals /quotations their standard structure of an audit report as reference

• Demonstrate experience of auditing international non-governmental organizations;

• Provide a brief description of approach to the assignment

• Provide references of recent experiences in performing external audit services, which should be a sample list of past clients, which should include the name of the organization, contact person, designation, contact number and email, nature of the service and period of the appointment.

• Provide any value addition services you would be able to provide besides the contracted service.

4. Structure of the Audit report

For means of standardizing the audit reports from all Country offices of DSW, we request that the Auditors use the following structure:

• Audit Assignment

• General background information of the foundation

• Scope, type and extent of audit

• Statements and explanations regarding the financial system and procedure, consisting of the accounting and the annual financial statement and project-cost-center reports

• Audit results

• Appendices

• Statement of financial position(standardized)

• Statement of Income and Expenditure (standardized)**

• Statement of cash flows (standardized).**

• Cost Center Report (standardized)

• Fixed Asset Schedule.

• Development and explanation of project reserve funds (standardized)

• Statements made about the accounting should include whether it is carried out in a complete, timely and orderly manner.

• The chart of accounts is to be audited on whether it is suitable to properly record business transactions.

• The notes regarding the balance should explain, upon which basis the verification, the statement and evaluation of the assets and losses have been made.

• The standards for calculating currency exchange rates should also be detailed.

5. Management letter

The auditor should submit a letter to the management at the completion of the audit. The

topics /issues to be covered in the letter should include:

 comments and observations on the accounting records, systems and controls that

were examined during the course of the audit;

 specific deficiencies or areas of weakness identified in systems and controls, and

recommendations for their improvement;

 Report on the degree of compliance of each of the financial covenants in the financing

agreement and comments, if any, on internal and external matters affecting such

compliance;

 matters identified during the audit, which might have a significant

impact on the implementation of the projects;

 comments on the extent to which outstanding issues /qualifications have been

addressed;

 comments on previous audits’ recommendations that have not been satisfactorily

implemented; and

 Bring to DSW Kenya’s attention any other matters that the auditor considers pertinent,

including ineligible expenditures.

 Recommendations to resolve/eliminate the internal control weaknesses noted .

 Management comments /response to audit findings and recommendations.

6. Auditor Experience & Qualification

The bidding person/firm should be –

• Be registered with the Institute of Certified Public Accountants of Kenya (ICPAK) and its partners must hold current practicing certificates. A Quality Assurance Review by ICPAK is added advantage

• The firm should demonstrate capacity, capability and experience required to undertake the audit within 14-20 days.

• The firm must have a physical address and valid business permit.

• The firm must have at least three referees who must be its clients.

• The firm must have at least two partners who must be full time practitioners.

• The firm should hold a valid Tax compliance certificate.

• The firm should have been in practice for a period of not less than 5 years.

The Key Team will comprise of at least:

a) An Engagement Partner with over 10 years’ auditing experience, with

sound knowledge of donor financed projects;

b) An Audit Manager with over 5 years of experience in auditing and with

sound knowledge of donor financed projects;

c) An Audit Team Leader with at least 3 years’ experience in auditing with

sound knowledge of donor financed projects;; and

d) Sufficient Assistant Auditors with adequate experience , professional

qualifications, with sound knowledge of donor financed projects;

7. Evaluation criteria

Interested entities should submit an expression of interest with the following: –

• Confirmation of the Firm’s understanding of the Terms of Reference and its capacity and capability to deliver on the Terms of Reference

• Organizational profile preferably demonstrating previous experience working with Not­ for-Profit donor funded entities

• Proof of registration with ICPAK and Partners’ Practicing Certificates;

• Financial proposal detailing proposed fees and/or expenses.

Proposals will be evaluated on;

• The technical expertise/ability

• The organizational capacity

• Experience in similar work

• Value addition services besides contracted work

• Favorable references

• Financial proposal