TERMSOF REFERENCE FOR PROVISION OF AUDIT SERVICES TO INNOVATIONS FOR POVERTY ACTION(IPA), RWANDA.

1. Background:

Innovations for Poverty Action (IPA) is a 501c3 non-profit organization that discovers and promotes effective solutions to global poverty problems. We design, rigorously evaluate, and refine these solutions and their applications together with decision-makers to ensure that the evidence created is used to improve opportunities for the world’s poor. In the ten years since IPA was founded, we have worked with over 250 leading academics to manage over 400 evaluations in 51 countries. Our experience in East Africa is extensive with 45+ evaluations being led by more than 700 staff currently underway.

IPA is registered in Rwanda under the International Non-Governmental Organization with registration number 056/RGB/18; Tax Identification Number 103209673. Our research here is currently focused on education, financial inclusion, transportation, and employment generation, all areas of pressing national concern. Currently, we are working to expand our research network and are exploring opportunities to expand into other sectors, such as health and agriculture. IPA Rwanda  has restricted grant income of approximately Two million USD per year

2. Objective of the Audit

1. The objective of the audit of the organization’s financial statements is to enable the auditors to express an independent professional opinion on the financial position of the organization and to ensure that the funds granted to the organization have been used for their intended purposes.
2. The organizations’ books of accounts provide the basis for preparation of the Financial Statements by the Country Management Team and are established to reflect the financial transactions in respect of the organization. IPA Management maintains adequate internal controls and supporting documentation for transactions.
3. The specific objectives of the audit are as follows:

• To give an opinion on the financial statements whether they present a true and fair view of income and expenditure in accordance with the generally accepted accounting principles.
• To evaluate the internal control structure of IPA, estimate the audit risk and identify any matters worthy of mention, including any substantive shortcomings.
• To make observations in order to determine whether IPA has satisfied in every substantive respect the accounting principles, custodian controls, internal controls and Governing Laws of the country.
•  All substantive matters which do not meet the said conditions and all indications of unlawful acts must be identified and reported in the Management Letter, with recommendations on how the weaknesses should be rectified to suit IPA’s circumstances.

3. Auditing Standards:

• The Audit shall be conducted in accordance with Applicable Auditing Standards in Rwanda
• The audit shall comprise only the material observations as are considered necessary under the circumstances. 

4. Scope of work:

This is full scope audit covering the period from January 2023 to December 2023; auditors will be required to carry out sufficient audit steps and procedures to ensure that the objectives are met. The location of audit will be at IPA Rwanda Country office in Kigali. This audit needs to be completed by 15 March 2024.

5. Financial Statements

1. The auditors will ensure that the financial statements are prepared in accordance with the Applicable Accounting Standards in Rwanda
2. The Financial Statements prepared by the organization’s management shall include.
   1. Statement of Financial Position;
   2. Statement of Receipts and Expenditures;
   3. Statement of Change in Net Assets;
   4. Statement of Cash flows;
   5. Notes the Financial Statements; 

6. Deliverables: Final audit reports and management letter for the financial year ended December 2023. 

1. Final Audit report 

The audit report will comprise (i) the auditors’ opinion on the organizations financial Statements and (ii) a complete set of organizations financial statements and (iii) other relevant statements as mentioned in section 5.2 above. 

In addition to the audit report, the auditors will prepare a “management letter” in which they will:

1. Give comments and observations on the accounting records, procedures, systems and controls that were examined during the course of the audit.
2. Identify specific deficiencies and areas of weakness in systems and controls and make recommendations for improvement.
3. Report on the degree of compliance with each of the IPA policies and procedures and funding agreement and give comments, if any, on internal and external matters affecting such compliance.
4. Report on the implementation status of recommendations pertaining to previous period audit reports;
5. Communicate matters that have come to their attention during the audit which might have a significant impact on the implementation and sustainability of the projects; and
6. Bring to the IPA Rwanda’s managements’ attention any other matters that the auditors consider pertinent. 

2. Payroll Controls: 

Review IPA’s Payroll processes in relation to HCN, TCN/EXPATs, and casuals. Determine if IPA is processing payroll correctly, and if it is remitting accurate taxes to the various entities as required by various regulations. 

3. Tax Compliance: 

General review of tax compliance position of IPA in relation to various applicable tax regimes like VAT, VAT Withholding, PAYE, Income Tax, withholding tax etc.

4. Recordkeeping:  

Determine if IPA is maintaining complete accounting records that adequately document each transaction and are maintained in an organized manner that ensures accurate retention and quick retrieval.

5. Procurement system:

Test and review IPA Rwanda procurement processes as outlined in IPA procurement manual and provide an opinion as to their adequacy and effectiveness.

6. Transfer Pricing:

Assess how the Transfer Pricing requirements impact IPA Rwanda Office and advise the way those impacts may be treated. 

7. Submission of Quotations: 

1. Quotations for the engagement must be addressed to the Deputy Country Director and emailed to  RWA_proposals@poverty-action.org  than 17.00 Rwanda time on Sunday , February  11^th , 2024. Late submissions will not be considered.
2. Firms must submit:
   1. A fixed gross price for the Scope of Work and Deliverables in Rwanda shillings only valid for Ninety (90) days from end of the quotation period
   2. An outline of recent experience on assignments of similar nature, experience in conducting audits for ING organizations. For each assignment, the outline should indicate, inter alia, duration of the assignment, contract amount, and firm’s involvement. Expected competencies of consultant, it is expected that the competency of the contracted agency/individual consultant will include a description of the organization of the proposed audit team and the main roles and responsibilities of each team member, as required in the TOR
   3. Understanding of terms of reference-one page
   4. Proposed individuals to carry out the assignment and qualifications, as required in the Terms of Reference (TOR). Curriculum Vitae (CVs) must be provided to the client by the Partner of the firm of auditors who shall be responsible for signing the opinion, together with the CVs of managers, supervisors and key personnel proposed as part of the audit team. The CVs shall include details of audits carried out by the concerned staff, including ongoing assignments indicating capability and capacity to undertake the audit.
   5. A description of the methodology and approach for performing the assignment, timeframe and work plan, a detailed activities schedule/work plan with a time frame.
   6. Firms   must   include   full administrative   details of   their company including:

• Copy of Trade License.
• Original or certified copy of affidavit of no debt by RRA still valid.
• Original or certified copy of affidavit of no debt by the Rwanda Social.

Security Board still valid.

• Copy of VAT registration certificate.
• Proof that RRA accepts audit opinions from the firm.
• Membership certificate with ICPAR.
• Copy of the valid Data Protection certificate issued by National Cyper Security Authority