End of Project Audits on Implementing Partners – Program Wide Requirement

Objectives of the assignment

Please download and read carefully the full Invitation to Tender above and check the following attachments:

2. Framework Agreement 

3. Task Order 

As managers of CFYE, Palladium (“The Company”) is responsible for ensuring that each recipient of CFYE co-investment is spent in accordance with the terms of their agreement and in accordance with Dutch Ministry of Foreign Affairs requirements. The objective of this assignment is to verify all IPs across the programme have expended CFYE funds appropriately and that the IPs can evidence the materialization of agreed co-funding (as per the funding agreements). Palladium is therefore seeking to procure an Auditor (“The Contractor” or “The Auditor”) or an auditor consortium to conduct individual audits on the remaining IPs (currently estimated to be 107) between the start date of this contract and the 31October 2026. Details of the IPs location, length of project, transaction value and co-funding allocations can be found in Annex A (check the full tender).

The Auditor will be required to carry out the specific tasks listed in the audit protocol and upon completion to submit to the Company a report of factual findings for each IP. The Auditor will provide an overall assessment of whether the IPs’ activities were expended in accordance with the terms of their agreements with CFYE and ensure there is clear evidence of the agreed level of co-funding. All audits will be conducted in person, with the exception of any high/ extreme risk locations where CFYE will accept an alternative audit methodology for these IPs. 3

CFYE are seeking to procure audit services under one contract to conduct all remaining external audits on active IPs as they enter their close out phase for the program. The value of this contract is estimated to be up to EUR1,000,000 and the contract will run from the contract award date to 31 October 2026. CFYE are open to proposals for regional partnerships or an audit firm consortium (if this practical). Although the intention is to contract only one Auditor for all CFYE countries, Palladium retains the right to contract multiple Auditors for each CFYE countries if it decides that no single organisation or consortium would offer sufficient coverage across all CFYE countries.

The successful bidder will be able to demonstrate Value for Money (low price) and that the auditor (be that a single audit firm or an audit consortium) can perform audits in all the countries as listed on page 2 of this document. The successful bidder will also propose a clear and practical contract management proposal.

The proposal should detail plans of:

1. How the contract will be effectively managed;
2. Who will be the central management team and appoint a ‘Contract Manager’;
3. How key developments will be communicated to CFYE;
4. How the audit reporting will be kept consistent throughout the contact;
5. How audits will be kept on track and to the agreed timelines;
6. How key trends and lessons learnt will be captured and communicated back to CFYE.

Scope of the assignment

Audit Scope Preparatory / Inception of Contract

At the start of the Subcontract agreement the Auditor will obtain a familiarity with CFYE and a general understanding of the terms and conditions of the program and its contracting mechanism prior to conducting any audit assignment. This will be done through a pre-engagement meeting (s) with Palladium and the CFYE team (more information on this is detailed in this section below). In addition, the successful Auditor and CFYE will establish a regular meeting and a schedule for contract management reporting.

Other key deliverables during this phase will be:

1. To collaboratively develop and agree on a work order commissioning to completion process and timelines.
2. To develop key information documents on CFYE to be disseminated to supporting country audit teams.
3. Establish a shared filing and report sharing platform and document naming convention. 4. Agree on lines of communication with CFYE to reassure that audits are on track.

Once a work order process has been commissioned and agreed with the auditors Contract Manager, CFYE proposes that the below actions should be undertaken between the programme and specific audit team selected to kick-off the in-person audit (although this will be agreed at the start of the contract with CFYE):

– Participate in a pre-engagement meeting with CFYE.

– Review and understand the terms and conditions of the specific IP Funding Agreement.

– Review and understand all other relevant policies and report templates as shared by CFYE.

Send any relevant questions to the CFYE team ahead of the start of the IP audits.

Financial Report and Financial Systems

In completing each audit assignment, the auditor will be expected to:

– Deliver the audit as per the specific CFYE Audit Protocol which can be found in Annex B; and

– Deliver the audit as per the audit methodology proposed by the successful audit firm.

Audit deliverables

The Auditor will compile and submit to Palladium a report of their factual findings per IP audited. It is expected that before final submission of the report the IP has the opportunity to review and comment on the findings. The report should contain sufficient detail to enable Palladium to understand the nature and extent of the tasks performed by the Auditor and their findings in relation to each task.

Key Information on Implementing Partners

Please refer to Annex A which presents the following information:

1. Complete list of current IPs. Note that this list could possibly change if any IP’s contracts get terminated or IPs drop out of the programme.
2. The country and city where the IP head office is located to indicate where the audit will most likely has to take place (most audits will need to take place face-to-face).
3. The dates of transactions which will need to be reviewed in each audit and the contribution split between CFYE and the IP.

Audit protocol Refer to Annex B.

Additional specifications

In addition to the minimum specifications above, the Auditor is required to meet at least one of the following specifications:

a) The Auditor is a member of a national accounting or auditing body or institution which in turn is member of the International Federation of Accountants (IFAC).

b) The Auditor is registered as a statutory auditor in the public register of a public oversight body in an EU member state in accordance with the principles of public oversight set out in Directive 2006/43/EC of the European Parliament and of the Council (this applies to auditors and audit firms based in an EU member state).

c) The Auditor is a member of a national accounting or auditing body or institution. Although this organisation is not member of the IFAC, the Auditor commits him/herself to undertake this engagement in accordance with the IFAC standards and ethics.

Audit Contract Overall

The overall engagement for the audit will be governed by one agreement which will cover the start date until 31 October 2026. Each audit assignment will be commissioned by a work order which will be drafted by CFYE and sent to the Contract Manager which will provide the following details:

1. IP name and head office location.
2. Dates of transactions to be audited.
3. Total expenditure value.
4. Proposed start and end dates for the audits (final end dates will be discussed and finalised with the Contract Manager). It is expected that the Auditor will ensure that there is sufficient staff capacity to conduct the audit engagement to meet the delivery timeline. Agreed notice periods will be agreed during contract negotiations.
5. Key focal points from the global CFYE team and the in-country management team for the specific country.

NB: On the occasion that there are multiple audits required around the same time period, CFYE will issue one work order to cover all audits in one country over a three-month period.

Contract performance

The contract will have regular contract review phases to ensure that the audit firm is performing to a high standard and in line with the agreed terms of reference. A suggested contract review schedule is set out below, but this will be finalised at the contracting phase:

– 1st Contract Review 3 months into the contract.

– 2nd Contract Review 6 months into the contract.

– 3rd Contract Review 12 months into the contract, and then depending on the performance of the audit firm, contract reviews would be every 6 to 12 months.

 Audit Personnel

In this section any requirements on the audit personnel are specified.

Centralised Contract Management Team/ Contract Manager:

– Experience in carrying out audits of Donor Government (e.g. USAID, European Union, FCDO, AFD etc.) or Multilateral funded international aid projects that include a grant component.

– Have prior experience in working on donor funded audits.

– Have good connections with country offices and partners.

– Have excellent communication and organisational skills.

– Have excellent written and spoken skills in English.

– The current assumption would be that the Audit Contract Manager would be based in the Netherlands, although CFYE is open to suggestions for the location of the Audit Contract Manager if this was to provide better Value for Money.

Auditors (appointed for the individual WOs)

The Auditor must meet the following minimum specifications:

– The Auditor will be sufficiently experienced, qualified, and familiar with local laws, practices and regulations to conduct audit assignments in the specified country.

– The Auditor will have sufficient staff capacity to be able to conduct an audit assignment within an agreed time period which will be established at during the preparatory/ inception phase of this contract.

– Experience in carrying out audits of Donor Government (e.g. USAID, European Union, FCDO, AFD etc.) or Multilateral funded international aid projects that include a grant component.

– The necessary qualifications, certifications, and registrations to oversee the conducting of audit assignments in the specified country. The Auditor is expected to provide details and CVs for selected nominated personnel. The nominated personnel will be the partner(s) or other senior person(s) within the Auditor’s organisation who is accountable for the engagement and for the report that is issued to Palladium upon completion of each audit assignment