TERMS OF REFERENCE – COUNTRY ANNUAL AUDIT

Evidence Action seeks to engage the services of a professional audit firm to conduct an external audit for the period of 1st October 2024 to 31st December 2025 with a renewable contract based on performance in Cameroon.

Scope of Work

The auditor’s role will be to provide the professional services set out below ('the Services"). Below are the detailed procedures that we will carry out.

General procedures

I.    Obtaining the trial balance and determining whether it agrees with the general ledger and the financial statements.
II.    Consider the results of previous audits and review engagements, including accounting adjustments required.
III.    Inquiring whether there have been any significant changes in the entity from the previous year (e.g., changes in ownership or changes in capital structure).
IV.    Inquiring about the accounting policies and considering whether:
a)    They comply with local and international standards;
b)    They have been applied appropriately; and
c)    They have been applied consistently and, if not, consider whether disclosure has been made of any changes in the accounting policies.

V.    Reading the minutes of meetings of the board of directors and other appropriate committees in order to identify matters that could be important to the review.
VI.    Inquire if actions taken at board of directors or comparable meetings that affect the financial statements have been appropriately reflected therein.
VII.    Inquire about the existence of transactions with related parties, how such transactions have been accounted for and whether related parties have been properly disclosed.
VIII.    Compare the results shown in the current period financial statements with those shown in financial statements for comparable prior periods and, if available, with budgets and forecasts.
IX.    Obtain explanations from management for any unusual fluctuations or inconsistencies in the financial statements.
X.    Consider the effect of any unadjusted errors – individually and in aggregate.
XI.    Bring the errors to the attention of management and determine how the unadjusted errors will influence the report on the review.

Cash and Cash Equivalents:
 
I.    Obtaining the bank reconciliations and inquiring about any old or unusual reconciling items with client personnel.
II.    Inquiring about transfers between cash accounts for the period before and after the review date.
III.    Agreeing the cash book balance per the reconciliation to the control account in the general ledger and the cash book;
IV.    Tracing all entries in the cash book for a given period.
V.    Mobile money reconciliation.

Receivables
I.    Inquiring about the accounting policies for initially recording receivables.
II.    Agreeing grant incomes figures reported in management accounts/financial statements to trial balance
III.    Obtaining a schedule of receivables and determine whether the total agrees with the trial balance.
IV.    Obtaining and consider explanations of significant variations in account balances from previous periods or from those anticipated.
V.    Reviewing the aging analysis of the receivables. Inquiring about the reason for unusually large accounts, credit balances on accounts or any other unusual balances and collectability of receivables.
VI.    Discussing with management the classification of receivables, including noncurrent balances, net credit balances and amounts due from staff and other related parties in the financial statements.
 
Inventories
I.    Reviewing balances of stocks reported in management accounts/financial statements are accurate and valid;
II.    Ensuring completeness of stock balances reported in the books of account;
III.    Ensuring Stock transactions are properly analyzed and posted in the nominal ledger.
IV.    Reviewing stock adjustments made resulting from the last physical inventory count.
V.    Reviewing the basis used in valuing each category of the inventory
VI.    Compare inventory turnover with that in previous periods.
VII.    Agreeing stock balances per valuation sheets for ALL categories of stocks and comparing this with stock balances reported in management accounts/financial statements

Intercompany Balances (if applicable)
I.    Using the aged listing and control ledger, obtain trading balances for related parties (Evidence Action countries). Ensure that balances are reconciled monthly prior to closure for management accounts. Where there are differences, ensure reconciliations are done, reviewed for validity and that balances are followed up for subsequent clearance;
II.    Ensure inter-countries balances are signed off

Fixed assets
I.    Agreeing figures reported in management accounts/ financial statements to trial balance. Any variances will be discussed with Finance Manager/
II.    Ensuring assets summary schedule of property agrees to the detailed fixed assets register (FAR).
III.    Agreeing individual assets balances as per general ledger (GL) with detailed fixed assets register (FAR) balances.
IV.    Confirming the depreciation method and rates used are per fixed assets policy and re- calculate the depreciation amount to ensure that correct rates and useful life have been used.
V.    Ensuring that recorded fixed assets are correctly classified as capital assets and expenses (incidental costs) that should be capitalized are recorded as part of the fixed assets.
VI.    Confirming valuations/revaluations of tangible and intangible assets and that correct amounts have been adopted in the books of account.

Expenses
I.    Confirming that the expenses charged:
II.    Are justified by their compliance with approved budgets;
III.    Are authorized and are in accordance with the policy, procedures and procurement act;
IV.    Are eligible expenditure;
V.    Have actually been borne and are valid;
VI.    Are adequately supported by third party documentation;
VII.    Represent value for money expenditure;
VIII.    Relate to the organization and has been incurred and disbursed within the period under review
 
IX.    Have been recorded in the financial records in the correct amounts and proper period.

Trade Payables
I.    Reviewing the vendors reports to ensure invoices are recorded in numerical sequence (internal numeric numbers);
II.    Agreeing vendors report totals to the supporting invoices; and
III.    Tracing the monthly invoice totals per report into the creditor’s ledger.
IV.    Agreeing the amount paid to supporting suppliers’ invoices/statement;
V.    Tracing the VAT amount into the input VAT account if applicable.
VI.    Tracing the total monthly payments in the cash book into the local creditors control account in the nominal ledger).
VII.    Agreeing creditors control account balances for each month and compare them with respective creditors’ month end aged listings. Where the two balances do not tally ask for a reconciliation of the two balances. Reviewing the reconciliation for validity and clearance of reconciling items.

Human resource and payroll
I.    Agreeing payroll figures (Salaries & wages & any other payroll deduction) reported in management accounts/financial statements to trial balance.
II.    Ensuring Proper computation of terminal benefits/emoluments and procedures are followed for staff leaving employment so as to safeguard the company against asset loss, litigations or any other risk;
III.    Ensuring Correct computation of staff salaries per individual employment contracts and complete accountability of all salaries disbursed;
IV.    Ensuring Payroll deductions are properly computed and remitted to the relevant authorities; and
V.    Agreeing net pay for the period under review with statement of salary transfer to the bank.
VI.    Confirming month to month payroll fluctuations are properly supported.
VII.    Ensuring that payroll expenses and liability are properly booked in the GL

Compliance with applicable legislation
Auditor will perform tests to;
I.    Ensure that Evidence Action complies with the applicable tax Rules, policies and regulations
II.    Determine whether National laws have been complied with and the financial and accounting procedures were followed
III.    Evaluate the implementation of the existing policies and establish gaps that need to be bridged in order to mitigate emerging risks;

Internal controls
I.    Carry out a comprehensive assessment of the adequacy and effectiveness of the accounting and overall internal control system to monitor expenditures and other financial transactions and ensure safe custody of organization assets.
 
II.    Review the financial management systems, accounting procedures, reporting procedures and corresponding outputs and other processes (control procedures) in place to carry out activities
III.    Evaluate the implementation of the existing policies and establish gaps that need to be bridged in order to mitigate emerging risks;

Qualifications and Expertise
Proposed firm must display the following expertise:

A.    Expertise and capacity of the firm in the region
●    Experience in the region; Proven with over 5 assignments
●    Non -profit audit experience and group reporting
●    Audit firm history 5 years and more
●    Audit experience in general purpose financial statements audits and audit of internal controls
●    Number of Qualified staff and coverage Qualified and experienced staff including certified auditors

B.    Audit approach
●    One principal auditor to sign all country specific audit reports.
●    The auditor has proof that their work complies with International Standards on Auditing (ISA).
●    Work Plan and ability to complete the assignment within the required time.
●    The degree to which the audit firm understands the assignment and has the important aspects of the task been addressed in sufficient detail.
●    Testing methodology and reference to IAS.
●    Communication and cooperation with Global auditors.

C.    Audit personnel
●    Relevant experience of Principal Auditor at least 10 years of audit experience and Audit certificate of Principal Auditor. (Being registered as a chartered accountant at ONECA and CEMAC)
●    At least 5-year experience of the team leader / Audit manager.
●    Auditor Certification/Accounting certification by Country.
●    All proposed team members have at least 3 years of experience & knowledge of local operating environment.

D.    Expected Audit package
●    Auditors’ independent opinion including reasons for negative or restricted audit certificate, if any.
 
●    Audited financial statements in both USD or Local currency as required by law or by Evidence Action.
●    Management letter (consolidated), the recommendations given by the auditor, for systemic improvement and better financial discipline. Response from management and follow-up of previous year’s recommendations.
●    Additional statements and/or confirmation as requested by Global auditors


E.    Financial Evaluation
●    The cost is within our budget.
Payment terms: 40% upon signing engagement letter and 60% upon submission of final reports.

F.    Bids Evaluation: The Technical offer will have a weight of 80% and the financial offer 20% Technical offer.
●    Methodology and timeline -25 points
●    CV and experience of auditors -20 points
●    Experience of the audit firm in Audi (by presenting both contract and completion mission certification)-20 points
●    Experience with NGO (by presenting both contract and completion mission certification) -30 points
●    Presentation -5 points

Approved by:
_________________________  
Evans M Ithiria
Director, Finance & Operations | Africa Region

All enquires on this request for proposal should be done not later than Thursday the 3rd July 2025 via email to procurement.cameroon@evidenceaction.org cc: evans.ithiria@evidenceaction.org