TERMS OF REFERENCE FOR END OF PROJECT AUDIT

  1. Background

The Agricultural Business Initiative Trust (aBi) is one of the components of the U-Growth programme aimed at supporting the private sector in achieving the objective of the government of Uganda’s Competitiveness and Investment Climate Strategy (CICS). The component is managed by Agricultural Business Initiative Trust (aBi Trust), a registered corporate body under the Trustees Incorporation Act, Caption 165.

The mandate of aBi Trust is to support the private sector actors to increase their contribution to the agricultural sector by increasing landproductivity, and market competitiveness thereby contributing to poverty reduction through economic growth, wealth and employment creation.

The development objective of aBi Component is building a self-sustaining export led economy in which the benefits are shared by all Ugandans and its immediate objective is “to strengthen the competitiveness of Uganda’s agricultural and agro-processing sector.” The aBi Trust has two interrelated subcomponents, each with its immediate objectives:

  1. Value Chain Development (VCD) leading to improved performance efficiency of actors and value chains (with focus on value chain actors and non-financial service providers) and including trade-related Sanitary and Phytosanitary (SPS) and Quality Management Systems (QMS) (with focus on value chain and specific service providers)
  2. Financial Services Development (FSD) increasing access to financial services (with focus on the relation between financial service providers and value chain actors)

In attaining the above goals, aBi Trust provides grants to implementing partners (IPs) who implement the approved agricultural related interventions in a project period of one to three years. Key activities funded by aBi Trust include training of farmers in good agricultural practices, consultancy and capacity building services, procurement of agricultural related inputs and equipment under the VCD and branch expansion, product development, financial literacy, and risk management insurance products under the FSD.

Since its inception in 2010, a number of projects have ended and it is aBi Trustpolicy that all ended projects are comprehensively audited by independent and professional external auditors to ascertain that project funds were utilized as intended and in line with approved project agreement and aBi Trust guidelines.

  1. Objectives of the Audit

The overall objective of the audit is to provide independent and objective assurance that all grant funds aBi Trust partners has been utilized in accordance with the project objectives and aBi Trust grant agreement.

2.1.Specific objectives;

i).To audit the assigned partnerprojectaccountability documents and express an opinion as to whether all project funds were legitimately spent on approved project activities and in accordance with the terms of the grant agreement including reasonableness of expenses.

ii).To review and determine the effectiveness of the implementing partner's internal control, risk management and governance systems.

  1. Scope of work

The audits shall be carried out in accordance with International Standards on Auditing and will include such tests and procedures, the auditors consider necessary to provide an independent, objective and professional audit opinion under the given circumstances.

The audits shall cover grants awarded to Implementing partners as listed in Appendix I of this document.

Without limiting the audit procedures, special emphasis shall be paid to the following areas among others;

i).Separate bank accounts have been used for project activities in accordance with the provisions of the grant agreement;

ii).All aBi Trust funds have been used in accordance with the project terms and conditionspaying due attention to value for money on spent project funds.

iii).Goods and services financed have been procured in accordance with the grant agreement and all expenditures have been properly accounted for (supported by genuine accounting records and third party documents such as receipts, invoices, and attendance lists etc.);

iv).Appropriate supporting documents, records and books of account relating to all project activities have been kept. Clear linkages should exist between books of account and the fund accountability statements presented to the Trust.

v).The intervention is appropriately attributed to aBi Trust support.

vi).Comprehensive assessment of the adequacy and effectiveness of the accounting and overall internal control systems to monitor expenditures and other financial transactions and ensure safe custody of project financed assets and that they are being used for the intended purposes.

vii).The auditor should ascertain that fixed assets are exist and are properly evaluated and that property rights and related beneficiary’s rights are established in accordance with Grant Conditions; and

viii).Ineligible expenditures identified during the audit will be identified and reported on and should be taken into account in the auditors’ opinion.

  1. Auditor independence

The auditor must be completely impartial and independent from all aspects of management or financial interest or any other interest that may potentially affect or be seen to affect the auditor’s opinion prior and during the execution of the audit assignment.

  1. Auditor’s qualification

The audit firm should be registered by the Institute of Certified Public Accountants of Uganda with a minimum of 5 years' practice experience in auditing of donor funded programs. The team of proposed auditors should equally be qualified and experienced in the audit of donor funded projects (CVs should be part of the proposal).

  1. Deliverables

Within two months of signing the audit engagement letter, the auditors shall submit to aBi Trust an audit report for each implementing partner in the format approved by aBi Trust. The audit report shall include an opinion on whether the project funds were fully utilized in the implementation of project activities. The auditors are also expected to provide a management letter highlighting weaknesses noted and responses from implementing partners.

  1. Cost

The total budget for the audits is Ushs 25,000,000 (Twenty five million shillings) inclusive of VAT and disbursements.

Changes in the scope of the Audit Services and estimated cost for such services will be communicated in supplemental letters where applicable.

  1. Expression of interest

Expressions of interest including a technical proposal shall be submitted electronically to aBi Trust e-mail by 24 June 2015.

APPENDIX I: ENDED PROJECTS FOR AUDIT

NO. / ORGANIZATION / INTERVENTION / LOCATION / HEAD OFFICE LOCATION / NO OF PROJECTS / TOTAL GRANT
1 / MUKONO DFA / Maize / Mukono / Plot 307, Bugerere Road, Mukono town / 3 / 771,812,250
2 / Uganda Microcredit Foundation (UMF) / Product development / Mukono / Mukono / 2 / 215,200,000
3 / Opportunity Uganda / Product development / Kampala / Kampala / 2 / 308,461,000
4 / Housing Finance Bank / Technical assistance and capacity building / Kampala / Kampala / 1 / 127,581,000
5 / Micro Uganda Limited / Outreach / Kayunga, Mukono / Mukono / 1 / 106,505,500
Total / 9 / 1,529,559,750