TERMS OF REFERENCE YEARLY EXTERNAL AUDIT FOR THE ASEAN FOUNDATION REF: 2014/PROC/XII/004 (EXTENDED DEADLINE)
The ASEAN Foundation invites Certified Public Accountants/Audit Firm to submit technical and financial proposals for a Financial Audit of the ASEAN Foundation’s Funds. As guidance of our Board of Trustees, we are requested to have a yearly Financial Audit done by an external party.
The cost of preparing a proposal and conducting the pre-proposal survey or any meetings for verbal presentations shall be borne by your company, regardless of the conduct or outcome of the solicitation process. Proposals must offer services for the total requirements. All proposals must remain valid and open for acceptance for a period of 100 (one hundred) days after the date specified for receipt of proposals.
The ASEAN leaders agreed to establish the ASEAN Foundation on 15 December 1997 in Kuala Lumpur during the Association’s 30th Anniversary Commemorative Summit. The ultimate aim was to help bring about shared prosperity and a sustainable future for all ASEAN Member States. The objectives of the Foundation are to promote greater awareness of ASEAN, and greater interaction among the peoples of ASEAN as well as their wider participation in ASEAN’s activities, especially through human resources development that will enable them to realise their full potential and capacity to contribute to the progress of ASEAN Member States as productive and responsible members of the society. It also aims to contribute to the evolution of a development cooperation strategy that promotes mutual assistance, equitable economic development, and the alleviation of poverty.
The overall objectives of the audit are:
- The auditor will perform work in accordance to the generally accepted accounting standards which encompasses financial controls, safeguarding of assets, compliance with ASEAN Foundation Financial Rules, reviewing administrative and financial controls in the areas of program and operations, and assuring that appropriate controls are in place and functioning effectively;
- The auditor will provide a complete audit report and must express an opinion on the accuracy of the financial statements in all material respects and provide recommendation for any weaknesses noted.
IV. Audit Scope
The audit will focus on financial controls, safeguarding of assets and compliance with established policies, procedures, reporting practices, laws and regulations. The audit performance will enable the external auditors to express an opinion on the accuracy of the financial statements and adherence to the own ASEAN Foundation or reasonable policies, regulations and procedures.
The ASEAN Foundation manages several funds, which are labelled : Endowment Fund, Operational Funds and Project Funds. The auditor will be performing a Financial Audit covering the period of 01 January 2014 up to 31 December 2014.
The auditor shall perform examination on the reliability of the accounts, legality and regularity of transactions. The audit shall be designed and performed to obtain reasonable assurance that financial reports are free of material misstatement caused by either error or fraud. It will include any tests and controls as the auditor considers necessary under the circumstances. Further, incorporated in the audit is an assessment on the appropriateness of the accounting principles used and the significant estimates made by management.
Minimum issues to be investigated are:
- Do statements give a correct view of actual expenses and costs?
- Have goods and services been procured following guidelines in ASEAN Foundation’s Financial Rules and Procedures?
- Are all necessary documents, records and accounts available?
- Are internal control, risk management and authorization processes adequate?
- Are inventories and fixed assets kept in place?
Upon completion of the audit, the audit firm will meet with and report the findings to the Board of Trustees and senior management of ASEAN Foundation for discussion, review, clarification and conclusions. This meeting will also serve to establish corrective action recommendations for the future of ASEAN Foundation’s Financial and Funds Management.
Any supporting documentation or other work papers resulting from the audit should be retained by the independent auditor and be available should questions arise. Supporting documents should be included and attached as references.
- Audit report
VI. Management Letter
In addition to the audit report and opinion, the auditor will be required to prepare a management letter. In the management letter the auditor should:
- Recommend improvements where specific weaknesses are identified in the management of Funds and communicate any matter identified during the audit that might significantly affect the implementation of the future operations, or that the auditor considers pertinent.
- Comment specifically on the appropriateness of policies for co-managed funds.
- Comment on the management and sub-account system.
- Comment of the accounting records, adapted system and controls that were examined during the audit, including but not limited to systems for handling and recording funds to sub-accounts, adherence to policies and procedures and so on.
VII. Audit Proposal Structure
Proposal must incorporate the following information:
- Understanding of the work: demonstrate understanding the operation of the non-profit organization and the nature of the work.
- Audit approach: describe the proposal approach, timing of tasks and quality control procedures.
- Audit team: for each member of the audit team, describe roles in the engagement and approximate level of effort. For each licensed auditor proposed for this engagement, provide separate attachment with name and brief summary of qualifications and experience: including education, audit experience including experience in foreign funded project, written and spoken fluency in English.
- Firm structure: state the legal nature of the firm, state the total number of auditors who are owners and/or employees of the firm. Indicate the auditing services provided by the firm and state whether the firm has any associations or affiliation with any other professional firm as auditors in the Indonesia or abroad.
Each bidder is required to submit a cost proposal or fee in USD in fixed rate.
IX. Proposal Scoring
The award criteria are on the basis of the best value for money.
X. Timing of the Audit
The draft audit report and opinion and the management letter should be received 10 days after the completion of audit field work which is scheduled on 2-14 February 2015. The audit report shall be submitted two weeks before the regular meeting of the Board of Trustees in May 2015. They should be A4 formatted in English and copied 4 hard copies and 1 electronic version.
XI. Submission and Deadline of Offers
The technical and fee should be in two (2) copies and with envelopes properly sealed and labeled, mentioning clearly “External Financial Audit”.
All proposals and correspondence should be addressed to:
Procurement Committee ASEAN Foundation
Jl Sam Ratulangi No 2, Menteng
Phone: +62 21 3192 4833
Or email to: firstname.lastname@example.org
Proposal should be emailed or sent by courier and should arrive at ASEAN Foundation office not later 8 January 2015.