Audit Objectives

The purpose of the in-depth audit is to provide SoH with a sound basis for its accountability, transparency and accuracy in the financial disclosure towards the funding agency BMZ. The tasks of this recruitment relate to:

FINAL AUDIT:

• An annual audit, with a detailed examination of all the supporting documents for 1st January 2023 – 31st March 2024;
• A conclusive examination of the complete project duration (1st April 2021 – 31st March 2024). Thereby, the auditor can refer to the last annual audit reports to be available at that time.

This in-depth audit will verify the compliance with standards of the funding agency BMZ, SoH, national regulations and the international accounting standards (ISA).

• The auditor will review the project’s financial documents, receipts lists, records of transactions, all vouchers and receipts disbursed, and relevant project documents in order to come up with a professional, independent opinion on the financial accounting of the project “Promotion of climate resilient communities and capacity building of local institutions and community organizations in Isiolo County” for all funds received and expended by MID-P from 1st January 2023 to 31st March 2024.
• Additionally, the audit shall give recommendations on strengths, weaknesses, and required improvement in the project-related financial and human resources management systems of MID-P.
• The audit will support the project quality assurance measures implemented by SoH and contribute to the decision-making process with regard to the project management and monitoring of finances by SoH and MID-P.

Expected Deliverables

The auditor is expected to produce an audit report, an audit certificate and a management letter, which will comprise the following:

• Presentation of the scope and mandate of the audit, as well as the list of documents that formed the evidence for the audit,
• An opinion whether financial statements (statement of accounts for the year being audited and the complete project duration) are issued in accordance with the financial reporting framework of the project, BMZ requirements and an internationally recognized accounting standard,
• Recommendations on identified shortcomings, and, if applicable, comments on the follow-up of audit observations and recommendations from previous years.
• A checked, signed and stamped list of all project costs receipts, sorted by BMZ budget lines (list is provided by the local implementing partner).
• Audit documents can be issued in English or German.

Scope of the Audit

The audit should focus on the following:

• The correctness and completeness of the accounting records,
• The financial report, showing all project related income and expenditure structured by budget lines,
• Deviations of expenditure by budget lines. The expenditure, which exceeds or falls below the budget appropriations by more than 30 %, shall be explained separately, if the approval of the BMZ has not previously been obtained,
• That receipts and relevant supporting documents are available for all project related income and expenditures,
• The management of the funds made available, which includes the transfer of project funds, all interest earned from the project funds during the reporting period and further income generated by the project,
• Reviewing the appropriate use of funds according to the project objectives,
• Evaluation of the efficiency and cost-effectiveness of the usage of funds,
• Budget adherence through the comparison between budgeted and actual costs in the currency in which the expenditure was incurred. The audit report will not convert the examined amounts into the Euro amounts,
• Reviewing if personnel costs and social security contributions conform to the regulations in the project country and are locally comparable,
• The economical use of the project equipment and assets,
• The inventory and the use of capital items, their whereabouts and their purposive usage,
• Compliance with the legal framework of the project (project agreements and annexes, contracts, etc.) and the donor requirements,
• Compliance with the policies of the local implementing partner regarding procurement, financial administration, human resources management and travel.

Procedures and Communication

• The auditor will be given access to all necessary documents in the project offices through the local implementing partner MID-P as well as relevant donor documents through SoH.
• The auditor will be responsible to set up a schedule in agreement with the local implementing partner MID-P. Any expenses for field trips, postal and translation services and other expenses shall be included in the auditor’s proposed budget. MID-P will support the auditor with logistics and arrangements, however, all payments of the contract will be made directly by SoH.

Qualifications and Experience

• Necessary qualification to serve as a recognized independent auditing authority,
• Minimum of five (5) years of experience conducting external independent audits of projects funded by international institutional donors in Kenya,
• Experience in conducting audits for BMZ-funded projects is beneficial.