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29 август 2024

Call for External Financial Audit for regional project “Youth Empowerment Enabling Prospects (YEEP 2)

TERMS OF REFERENCE

FOR CONDUCTING A MID-TERM AND FINAL FINANCIAL AUDIT

ON BEHALF OF SOS Children’s Village North Macedonia

FOR THE PROJECT “Youth Empowerment Enabling Prospects (YEEP 2)”

 

August 2024

 

  1. Company and project background

The national organization, the Association of citizens SOS Children’s Village North Macedonia, was formally registered in 2001 as a social-humanitarian association with a scope of activities in the domain of social protection,  As an independent member of the Federation SOS Children’s Villages International, SOS Children’s Village North Macedonia is pursuing the following overarching goal:  “To uphold the right of the child to grow up in a family with love, respect and in safety.”  In concrete terms, this means supporting vulnerable children and young people, their families and communities through:

(1) Family support or family strengthening

(2) Family-based care

(3) Advocacy work

The common standards and policies of the national association include child protection, gender equality, inclusion, data protection, anti-corruption, financial management, good management and accountability, results-based management and many more. Within the framework of its total capacities and services, SOS Children’s Village North Macedonia employs over 100 individuals working in various social service programs.

These programs include the Center for the Support of Foster Families, four residential units for assisted living, and two centers for advising families at risk. Moreover, the national association has implemented various programs and projects for children and young people at social risk, along with other projects for capacity building with institutions and professionals who work as part of the system for placement in care for children without parental care.

SOS Children’s Village North Macedonia and the other four project partners — the national associations of SOS Children’s Villages in Albania, Bosnia and Herzegovina, Kosovo and Serbia, since July 2023 are implementing the regional project Youth Empowerment Enabling Prospects (YEEP II) funded by the German Federal Ministry for Economic Cooperation and Development (BMZ) and SOS-Kinderdörfer weltweit – Hermann-Gmeiner-Fonds Deutschland e.V. focused on sustainable improvement of the living conditions of 2,770 vulnerable young people in the five project countries.

The project is implemented by the five national SOS Children’s Villages, which are referred to as Member Associations (MAs) in partnership with 23 civil society organizations on 29 locations, such as: Albania (Tirana, Fier, Elbasan, Lezha, Korca), Bosnia and Herzegovina (Sarajevo, Tuzla, Mostar, Zenica, Banja Luka, Brcko District),  Kosovo (Pristina, Gjilan, Prizren, Mitrovice, Peja, Ferizaj), North Macedonia (Skopje, Stip, Kavadarci, Strumica, Prilep, Tetovo) and Serbia (Belgrade, Zajecar, Krusevac, Kragujevac, Sombor, Pozega

The duration of the project is from 15.07.2023 – 15.11.2026.

Direct target group:

At least 2,770 disadvantaged young people (aged 16-35, at least 50% female) from the five Balkan countries:

–             Unemployed vulnerable young people and young parents

–             Young people who are or have been in alternative care and are growing up in a social institution or with foster parents.

 

The main objectives of the project are:

  1. Professionals are empowered to apply a holistic training methodology and provide quality labour market integration services to the target group.
  2. Vulnerable young people have acquired knowledge and skills that improve their employability in the labour market. Vulnerable youth have improved their socio-economic integration.
  3. Vulnerable young people have built their employability skills and professional networks through practical experience in the labour market.
  4. Local and national decision-makers have increased their awareness of the situation of young people at risk and are informed about possible strategies to address the socio-economic exclusion of the target group.

 

         2.     Objective of the Audit

SOS Children’s Village North Macedonia is seeking a certified audit firm to conduct external Mid-Term and Final Financial audit for the regional project Youth Empowerment Enabling Prospects (YEEP II).

 

Mandate and Relevance

In accordance with the requirements of SOS-Kinderdörfer weltweit – Hermann-Gmeiner-Fonds Deutschland e.V. (HGFD) all BMZ co-financed projects are obliged to undergo a complete project audit covering the whole project duration as well as annual or interim audits, as specified in the Project Proposal, to be conducted by an independent and recognised audit company. The audits of the accounts are essential for SOS Children’s Villages to prove to the donor that all the funds have been used for the intended purpose and according to donor’s regulations.

 

Location of Audit and timelines

The auditing shall be conducted at the location of the project, in particular at the place where the project bookkeeping is done: SOS Children’s Village North Macedonia and the other four project partners – the national associations of SOS Children’s Villages in Albania, Bosnia and Herzegovina, Kosovo and Serbia.

 

Audit Modality

  • General Modality: Remote (online)
  • On-Site Visit: One on-site visit at SOS Children’s Village North Macedonia for both Mid-Term and Final Audits.

 Detailed timeline for both the Mid-Term and Final Audits is presented below:

Scope of Auditing

The auditor’s assignment includes the following tasks:

  • To verify whether, or not each entities has accounting and operating policies and procedures manuals and their conformity with the agreements and relevant national regulations and National legislation.
  • To verify whether the Project has special bank accounts: one in EUR, that may be used to receive funds from various donors and one in local currency (LCY), that is used especially and exclusively for the project.
  • For all transferred installments, examine the accuracy and completeness of records (dates and amounts of exchange transactions, relevant fees, etc.) of the exchange transactions between EUR funds received from HGFD and LCY.
  • To examine whether any gain was generated from payments of HGFD and/or any third party, and if so, whether the interest thus gained was properly reflected in the accounting documents and used for the financing of project expenditure.
  • To thoroughly examine the bookkeepingrecords and ensure their alignment with the voucher list per each MA
  • On a sample basis, verify that the Project transactions are supported with supporting documents required by Partnership Agreement (e.g. invoice, receipt voucher, copy of cheque, copy of bank transfer etc.).
  • For all assets procured for project purposes with value above EUR 800 (excluding value-added tax) (or the respective amount in local currency, using the actual donor’s exchange rate), check whether the inventory and internal procedures for ensuring compliance with appropriation periods are in line with the procedures stipulated in the PA.
  • To verify that procurement of goods and services is made in conformity with Partnership Agreement conditions/ SOS MAs procurement procedures. Thus, documenting most economical and efficient use possible of funds made available for purchasing or construction/renovation purposes; if no quotation or tenders were obtained, the auditor shall give an assessment in his/her written report.
  • If immovables were purchased or buildings erected or renovated as part of the project, to examine evidence of ownership or of right of disposal, and to find out whether any encumbrances or obligations to third parties were created; also, to examine whether they are being used for project purpose for which they were destined as stipulated in the Project Proposal.
  • To certify that any transfer of ownership for items financed out of the grant has been documented (Asset Transfer Agreement) and previously agreed upon with HGFD.
  • To reconcile the project cash balance (considering all bank accounts used for the project) and obtain entity justification with regard to unspent amounts, if any.
  • In case of Revolving Funds to examine whether the same have been utilised in accordance with the terms laid down in the project proposal, especially referring to the loan purpose, the defined target groups and loan modalities.
  • Provided that expenses are recorded when paid (cash-based method), verify that non-cash items including depreciation and imputed costs are not charged to the project.

 

Auditing of Annual Statements

  • The auditor shall audit the accounts for the period as stated in the table above for mid-term audit and final audit. The final audit covers the period from the start until the end of the project.

 

Auditing Procedure

  • The auditing shall be conducted in accordance with the relevant national regulations as well as SOS-internal auditing standards and International Standard on Related Services (‘ISRS’) 4400. In addition to the auditing as such, the auditor may provide professional advice in whatever financial management and bookkeeping matters.

 

Auditor’s Report

  • The auditor shall draw up his statement according to the specimen provided by HGFD (Reference: Annex 4.2: Format Audited Statement of Accounts).
  • Financial statements must be presented in LCY for each MA. (There will be no consolidated report in EUR.) (Reference: Available GDB reports and databases).
  • As a source of data for donor reporting, the entered transactions in GDB – Grant Data & Budget Monitoring Tool, (a cloud-based software solution, using Microsoft’s Model-Driven PowerApp environment) will be utilized.
  • All the SOS MAs (project partners) shall provide the auditor with all supporting documentation in originals (digital copies can be accepted), preferably structured in conformity with the items of the financing plan and in chronological order.
  • The Annual Audited Statement of Accounts should be accompanied by a condensed voucher list in chronological order, including all payments effected by SOS MAs (Albania, Bosnia and Herzegovina, Kosovo, North Macedonia and Serbia) in original currency (expenditures paid by HGFD, e.g. for monitoring visits, shall be excluded).
  • The audit report should contain a statement of cash receipts (including converted funds, if available) which is to be supported by documentation (bank statements, exchange receipts, etc.) as well as a fund accountability statement
  • Budget items that exceed the budget appropriations by more than ± 20% must be explained separately, if prior approval has not been obtained from HGFD.
  • Any significant deviation between budgeted and actual receipts must be explained
  • The audit report shall contain a description of the detailed task that has been entrusted and a detailed list of documents which have been made available for inspection.
  • The audit report shall also include precise comments and recommendations on the accounting systems/procedures in force. Each following audit report shall refer to such recommendations and verify whether the same have been implemented by the project holder.
  • The copy of official registration certificate is attached to the audit report.
  • The mid-term audit report shall be submitted to HGFD by April 15th 2025 and the final audit covering the whole project duration not later than April 15th 2027.

 

 Final Audit Package

 The auditor shall submit the following documents, properly signed and stamped, on the completion of the audit process as Audit Package:

  • Auditors’ report, according to the format provided by HGFD (Annex 4.2: “Format Audited Statement of Accounts”)
  • Audited statement of accounts according to the format provided by HGFD (Available GDB reports and databases).
  • List of key employees.

 

Financial Statements will be prepared and signed by National Director of each MA and authorised person or as specified by the law of the country.

Submission of proposal

 

Interested Certified Public Audit firms should submit a Technical and Financial proposal in relation to the terms of references (ToRs).

The following information and documents shall be provided:

  1. Background information on the audit firm: Details of firm’s experience in providing auditing services to companies in the not-for-profit sector, especially international organizations
  1. Methodology to be used: Describe how your firm will approach the audit of the project, e.g. select expenditure items
  1. Describe how and why your firm is different from other firms being considered, and why our selection of your firm as an independent auditor is the best decision we could make;
  2. Firm’s registration details with relevant regulatory authorities
  1. Accreditation by the German Embassy or a recognized institution (e.g. chamber of commerce or national association of auditors)
  1. Provide references from not-for-profit organizations for which your organisation conducted audits in recent years;
  2. Provide names and resumes of key personnel that will conduct the audit
  3. Include estimated time required on-site to complete the services.
  4. Include fee proposal to complete the services outlined in this request

 

Selection Criteria

  1. Quality of Technical Proposal: Evaluation based on the depth, relevance, and feasibility of the proposed approach and methodologies.
  2. Competitiveness of Financial Proposal: Assessment of the cost-effectiveness and value for money presented in the financial proposal.
  3. Relevant Experience: Consideration of prior experience and expertise relevant to the project’s requirements.

 

Deadline for Application

  • Submission Deadline: September 16, 2024
  • Submission Requirements: Both technical and financial proposals are to be submitted by the deadline, to the archive of SOS Children’s Village North Macedonia, street ” Risto Šishkov 31”, 1000 Skopje, in a sealed envelope marked “DO NOT OPEN” for the project: “Youth Empowerment Enabling Prospects (YEEP II)”, no later than September 16, 2024.

 

Contact Information

  • For Questions Regarding the Project or Application Procedure:
    • Contact Person: Ivana Atanasova, YEEP II Regional Project Finance Manager
    • Email: ivana.atanasova@sos-kd.org

 

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