Kenya TOR: FINANCIAL AUDIT (CERTIFICATION) – FOR FINANCIAL YEAR JANUARY TO DECEMBER 2021 at Girl Effect

GIRL EFFECT TERMS OF REFERENCE

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FINANCIAL AUDIT (CERTIFICATION) – FOR FINANCIAL YEAR JANUARY TO DECEMBER 2021

Who We Are

Girl Effect is an international non-profit that builds media that girls want, trust and need.

From chatbots to chat shows and TV dramas to tech, our content helps adolescent girls in Africa and Asia make choices and changes in their lives. Igniting their confidence to act differently at a time that can define their future.

We create safe spaces for girls, sharing facts, and answering questions about health, nutrition, education, relationships, and so much more. To arm girls with the skills to negotiate and redefine what they are told is possible “for a girl”.

Our reach is 20 million and counting. And we’re using technology to reach girls at scale so every girl can choose to be in control of her body, her health, her learning and livelihood.

Because when a girl unlocks her power to make different choices that change her life, it inspires others to do so too. She starts a ripple effect that impacts her family, community, and country.

That’s the Girl Effect.

GE Kenya employs personnel with significant technical, organisational, and international business expertise, especially in market entry and sustainability, administrative and marketing assistance and support services, content creation, development and delivery, digital tech solutions, and website maintenance. GE Kenya provides business support to Girl Effect UK, Girl Effect USA and region-specific services to enable Girl Effect’s set up and management of global programmes.

Context of Assignment

Girl Effect in Kenya is advertising for a professional audit firm to conduct an independent audit and provide a professional opinion on its financial statements for the financial year ended 31st December 2021 and on the soundness of the organisation’s internal control systems to achieve its objectives, as a basis for filing financial statements to the Kenya Revenue Authority and with the Registrar of Companies. The audit firm will undertake and perform the services with the highest standards of professional and ethical competence.

Timeframe:

• Terms of reference published: Monday 14th February
• Extended Deadline for responses: Monday 28th February
• Supplier selection, contracting and briefing: Early March
• Project commencement: Mid March

Scope of work/ Description of Services

The audit scope will include all transactions relating to Girl Effect activities for the 14 months from November 2020 to December 2021. The audit will involve obtaining evidence on the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or errors. The audit will be carried out in accordance with international standards on auditing and applicable local laws and will include such tests and auditing procedures as the auditor considers necessary under the circumstances.

Specific tasks and deliverables

Special attention should be given by the auditor as to whether:

a) Girl Effect funds have been used with due attention to efficiency and economy, and only for the purposes for which funding was provided.

b)An appropriate management structure, internal controls and record-keeping systems are maintained and can be relied upon.

c) Procurements have been carried out per the relevant procedures, taking into account value for money.

d) All necessary supporting documents, records and accounts have been kept in respect of Girl Effect funds for the funding period. Clear linkages should exist between the books of accounts and relevant supporting documentation.

e)The accounting and overall management control system is adequate and effectively monitors disbursements.

g)Girl Effect Financial Statements are a true and fair representation of its activities, assets and liabilities.

h)On a sample basis determine whether the Programme is getting value for money on its purchases of goods and services by comparing costs incurred with the prevailing market prices, physical verification of some of the procured goods to ensure that they exist and authentication of documents used for drawing funds from the Programme.

The audit should include a rigorous examination of the system of internal controls, including organisation structure, authority levels, staff competence, accounting records and supporting documentation, segregation of duties, and monitoring arrangements. Where certain controls are impracticable, appropriate compensating controls should exist.

The auditor should plan the audit so that there is a reasonable expectation of detecting material misstatements in the accounts resulting from fraud, error or non-compliance with laws and regulations as may be necessary. If the auditor’s suspicions are aroused, she/he must inquire into all the circumstances until satisfied.

The auditor should produce and deliver to Girl Effect a detailed management letter specifying observations and recommendations based on the audit findings and a soft copy for circulation to partners and four hard copies of the following report components;

1. Statement of Financial Position,
2. Statement of Income and Expenditure,
3. Statement of Change in Equity,
4. Statement of Cash Flow,
5. Notes to the Financial Statements.

The Ideal Approach

The auditor will:

1. Carry out tests of transactions as necessary and will obtain an understanding of the entity accounting system to assess its adequacy as a basis for the preparation of the organisation’s financial statements to establish whether adequate records have been maintained;
2. Confirm that an appropriate internal control framework is in place to provide reasonable assurance on the operations of the organisation, efficient use of resources and reliability of the financial reports and
3. Confirm the responsibility for preventing errors, irregularities or fraud. The audit is planned to have a reasonable assurance that any material misstatements, irregularities and/or fraud in the entity financial statements is detected.

The above-defined approach does not restrict the audit procedures or the techniques that the auditor may wish to use in forming an opinion on the mentioned reports.

Expected deliverables

The Auditor is expected to perform the Final Audit of the organisation covering 14 months (Nov 4th, 2020 to Dec 31st, 2021).

1. Audit Report Covering 4th November 2020 to 31st December 2021

The opinion expressed in the audit report will address whether:

1. The financial statements present a true and fair view of the financial position of Girl Effect. In expressing this opinion, the auditor must examine whether the financial statements agree with these records in expressing this opinion.
2. Girl Effect funds have been used per civil society’s relevant local and global policies and procedures.
3. The auditor shall make a statement confirming they have complied with these terms of reference in the introduction to the management letter. In particular, they will confirm that they have complied with each of the points raised under the scope of work above.

Besides a primary opinion on the Financial Statements, the audit report should include a separate paragraph commenting on the accuracy and propriety of expenditures.

1. Management Letter

In addition to the audit report, the auditor will prepare a “Management Letter” which will:

1. Give comments and observations on the accounting records, systems, and controls examined during the audit;
2. Identify specific deficiencies or areas of weakness in systems and controls, and make recommendations for their improvement;
3. Communicate matters that have come to the auditor’s attention that might have a significant impact on the operations of Girl Effect.
4. Refer to any other matters that the auditor considers relevant.
5. Include a high, medium or low prioritisation on all issues arising in the management letters. Ranks should be allocated according to the following criteria:
6. “A” – a major weakness or a recurring issue that must be addressed soon
7. “B” – an important matter that will significantly improve the control environment, the accounting system, or the business’s operations but is not so serious or prevalent as to be considered a major weakness
8. “C” – a minor (or isolated) weakness that should nevertheless be addressed to improve the control environment, the accounting system or the operations of the business.
9. Document the status of implementation of prior years’ recommendations.
10. In all cases, a management letter MUST be issued. If no issues have arisen during the audit, the auditors must issue a management letter stating that no issues have arisen.
11. The management letter should also include management responses to the issues highlighted by the auditor.
12. Support on filing FS to KRA

The auditor will ensure that the financial statements of Girl Effect are filed on time to the KRA online system.

Who You Are

• Prior experience in auditing or certification for International Non for Profit Organisations in Kenya (at least three references).
• Applicants must be registered with ICPAK to practice in Kenya. They will be expected to submit a current certificate of good standing, 2022 organisational practising licence, and the current practising licences of the partner (s) involved in this assignment.

Proposal submission

Qualified audit firms are invited to submit a brief proposal (max 10 pages) that includes the following:

1. Qualification and experience of the firm.
2. Current practising certificates
3. Certificate of good standing with ICPAK
4. Approach and methodology to undertake this assignment underpinned by a demonstration of value for money.
5. Previous experience and engagement are in line with the ‘Who You Are’ section above.
6. A fee quote (cost in KES) and work plan.
7. The financial and technical proposals should be sent separately.

Reporting

The audit firm will report to Girl Effect’s Finance Manager.

Evaluation Criteria

The criteria against which proposals will be evaluated are identified in the table below:

Key Areas for Evaluation/ Assessment

Weighted Award

(A) TECHNICAL PROPOSAL

70

i) A detailed understanding of the assignment requirements:

15

• Demonstrate a detailed understanding of the services and the deliverables required.

15

ii) Personnel Experience and Resources

30

• Provide a list of experienced personnel to perform the required duties

15

• Demonstrate adequate resources to handle assigned responsibilities and to handle extenuating circumstances that may arise

15

iv) Relevant services undertaken by the applicant in past engagements:

25

• Demonstrate prior experience in auditing or certification for international charitable institutions / non-governmental organizations along with contact details of references in those organisations should Girl Effect wish to contact them for a reference.

15

• Demonstrate relevant geographical experience and knowledge to carry out the assignment effectively.

10

(B) FINANCIAL PROPOSAL

30

• Clarity, relevance, reality to market value/ value for money of cost for the assignment (inclusive of any applicable tax).

30

Tax

Applicants are advised to ensure that they have a clear understanding of their tax position with regards to provisions of Kenyan jurisdiction tax legislation when developing their proposals.

Disclaimer

Girl Effect reserves the right to determine the structure of the process, number of short-listed participants, the right to withdraw from the proposal process, the right to change this timetable at any time without notice and reserves the right to withdraw this tender at any time, without prior notice and without liability to compensate and/or reimburse any party.**