Terms of Reference (ToR) for External Financial Audit

1. Background

Action Aid Rwanda (AAR) is an Affiliate member of ActionAid International (AAI) – an anti-poverty agency working with poor, voiceless people, communities and similar-minded partners worldwide.

Action Aid International is a unique partnership of people who are fighting for a better world a world without poverty. AAI works in over 45 countries in Asia, Africa, America and Europe. Its mission is to work with poor and excluded people to eradicate poverty and injustice.

ActionAid Rwanda (AAR) was established in 1996. The Country Programme has got its country office in Kigali and 4 field offices. AAR interventions are in 5 districts, namely Nyanza District: Busasamana, Mukingo and Rwabicuma sectors, Nyaruguru District:Ruheru Sector, Karongi District: Murundi and Gitesi sectors, Musanze District :Shingiro and Muko sectors, and Gisagara District: Kibilizi,Muganza and Gishubi sectors.

ActionAid Rwanda (AAR) is committed to ensuring transparency, accountability, and effective financial management. As part of this commitment, AAR seeks to engage an external audit firm to conduct a comprehensive financial audit for the upcoming financial years of 2024, 2025, and 2026.

The Audit firm will submit a technical and financial quotation to the following adress

2. Objectives of the Audit

The primary objectives of the audit are as follows:

• To provide reasonable assurance that funding resources are managed in accordance with applicable standards and internal guidelines.
• To assess whether the financial reporting accurately represents the actual expenditure and revenue for the specified project period.
• To verify that project funds have been used in compliance with applicable legal and AAR regulations.

3. Scope of the Audit

The audit will cover the following areas:

• Examination of final accounts for project spending during the entire project period.
• Review of the approved budget and identification of any variations between planned and actual expenditure.
• Evaluation of financial policies and procedures to prevent fraud and ensure efficient implementation.
• Assessment of the reliability and correctness of accounting entries and documentation.
• Verification if AAR has kept proper books of accounts
• Confirming the existence and value of assets and liabilities
• Checking the proper distinction between capital and revenue nature of transactions.
• Understanding the accounting and internal control systems in order to assess their adequacy as a basis for the preparation of the financial statements.

4. Audit Process

• The auditor will consult with AAR to understand how the program is managed.
• AAR will be informed in writing about the audit commencement.
• The audit will be conducted at specified location(s) agreed upon with AAR.
• Relevant supporting documents and key staff will be made available during the audit.
• Any limitations or concerns discovered during the audit will be promptly communicated to AAR.
• Separate audit reports will be issued for each audited project if the scope covers multiple projects.

5. Reporting

• The auditor will prepare a draft audit report and a management letter.
• A meeting with AAR will be held to discuss major audit findings and recommendations.
• Feedback from AAR will be considered in the final audit report.

6. Qualifications

The selected audit firm should meet the following criteria:

• Registered and licensed to practice auditing in Rwanda.
• Experience in conducting financial audits for NGOs or similar organizations.
• Familiarity with international auditing standards.
• Having qualified or certified auditors

7. Application

The application will be composed of the following documents:

• Technical specification
• Financial quotation
• License/Registration to operate in Rwanda
• Three proofs of similar experience in NGO setting with reference details
• Rwanda Revenue Authority tax clearance

7. How to Apply

The Audit firm will submit a technical and financial quotation in hard copies, in well siled envelops addressed to ActionAid Rwanda Executive Director to the following address ActionAid Rwanda Head Office located in Remera, Remera, Behind Amahoro National Stadium; KG 178 ST 7 not later than 14^th June 2024 at 13:00.