REQUEST FOR PROPOSAL

Independent Activity Financial Audit of –Feed the Future Bangladesh Aquaculture and Nutrition Activity

1.   Introduction

1.1   Background Summary

Feed the Future Bangladesh Aquaculture Activity (BAA) is a five-year Activity funded by the United States Agency for International Development (USAID) to WorldFish to sustain positive aquaculture sector growth through an inclusive market system approach. The total Award value is USD28,458,192 and started in February 6, 2018 and will run until February 5, 2023 unless extended in accordance with the Terms of Reference of the agreement. BAA has now been running for just over 4 years and is managed by WorldFish Center, Bangladesh.
 The Activity aims to sustainably improve the livelihoods of a large number of smallholder fish farmers and other aquaculture value chain actors, providing them with the skills and knowledge to thrive in a growing market. The Activity is being implemented through private and public sector partners across the 21 south-western districts and 2 south-east districts in Feed the Future Zone of Influence (ZOI) and Zone of Resilience (ZOR) of Bangladesh respectively.  

WorldFish is looking for an external audit company to carry out an audit of BAA. The audit will cover the period January 1, 2020 to December 31, 2020.

  • Total actual expenses as of December 31, 2020 is USD 4,256,515
  • Location of documents, WorldFish Offices- Dhaka, Jashore and Cox’s Bazar
  • Location of project implementation, BAA works in the Bangladesh Feed the Future Zone of Influence (ZOI, consisting of 21 south-west districts) and the Zone of Resilience (ZOR, two south- east districts).
  • Deadline of submission of proposal/application January 20, 2022.

1.2   Audit Objective

The objective of the audit of the Financial Statements is to express a professional opinion on the financial position of the Activity at the end of the reporting period. The funds received and expenditures for the reporting period, as reported by WorldFIsh and the sub-grantees and in particular to confirm that the reported expenditures has, in all material respects, been used in conformity with the provisions of the PIO grant. Including any amendments thereto as contained in the agreements, and any applicable guidelines in force and applicable to the audit scope, and with due attention to economy and efficiency.
To also confirm that financial statements agree with the Activity  accounts (books of account) which provide the basis for preparation of the financial statements and are established to reflect the financial transactions in respect of the Activity, as maintained by WorldFish and the sub-grantees.
To also confirm that the financial statements reconcile with other information reported to USAID.
In addition, the audit will achieve the following specific objectives:

a) Determine the adequacy of the organization’s financial management and internal control systems to manage, control, account for, and report on USAID funds.
b) Identify specific financial risks associated with the nature of the activities being funded by USAID and how these are being monitored and mitigated.
c) Quantify in monetary terms (whenever possible), the effects of existing risks.
d) Evaluate the sub-grantees, financial reporting and monitoring system by the prime Implementing Partner (IP).
e) Sub-Grantee pre-award survey including assessment and testing of sub-grantee’s internal control systems by BAA and incorporating results of such evaluation/testing in award determination.
f) Review of Sub-grantees’ financial statements, assess financial performance and effectiveness of control system.

2.   Scope

The audit will be carried out in accordance with international standards of auditing. It will include such tests and controls as the auditor considers necessary including any visits to Activity  office as well as partner’ organization office or virtual audit if necessary. Representative sampling may be used as the auditor considers necessary. This exercise is required to give full and satisfactory audit discharged to the Activity expenditure from January 1, 2020 to December 31, 2020. Specific focus will be:

  • To establish that funds has been recorded and funds have been expended in accordance with the terms and conditions of the PIO agreement and within the scope of the Activity
  • Items and services have been procured in accordance with the guidelines included in the PIO agreement.
  • Necessary supporting documents, records and accounts have been kept in respect of Activity expenditure and that project expenditures are reasonable, allowable and allocable
  • To establish physical existence of USAID-funded assets per the asset register, their conditions and their locations.
  • Whether the systems, procedures and controls, contractual or otherwise adopted by BAA are efficient, effective and transparent.
  • Whether these systems, procedures and controls enabling BAA to discharge its contractual obligations to USAID including its financial and project management obligations.
  • Whether improvements to BAA systems, procedures and controls can be made as a result of the findings of this audit.
  • Whether the funds in BAA account were deposited, transferred and expensed properly in compliance with USAID guidelines and other relevant financial policies and procedures as stipulated under the PIO agreement.

3.   Methodology

The approach should include but not limited to:

  • Hold separate pre-engagement meetings with WorldFish to present an outline of the planned approach for conducting the exercise.
  • Request and hold formal interviews with BAA project and financial management team and with a view to forming an understanding of the effectiveness of the internal control systems in the management of the project.
  • The basis for which invoices have been calculated are in line with obligations within the PIO grant
  • Deliverables from short and long term consultancies were properly delivered and received before relevant costs where charged to USAID.
  • Duly authorized time sheets are available for consulting days charged to USAID during the period under review.
  • Review of locally incurred costs including but not limited to salaries, travel and transportation charges, sub-grants, contracts, consultants, training, other direct costs billed for reimbursement by both prime and sub- grantees
  • Schedule leave days are appropriately discounted from billable days on long and short-term consultancy fees.
  • Review and vet bills paid for services rendered by sub-grantees ascertain that:
    • Services billed in the period under review are covered in the relevant sub-agreements.
    • Contractually agreed deliverables have been achieved and approved by appropriate authority within BAA.
  • Examination of the financial transactions of the Activity under the management of WorldFish for the above period in line with expectations set out in the project documents listed below (to be made available after the contract has been let). Note that the financial records would consist of all documents relevant to the raising of an invoice.The PIO grant
  • The most recent logical framework
  • Amendments to the Activity’s key staff
  • Approved work plans for the period under review,
  • Any other formal correspondence between USAID and the Activity which may have effect on the focus, direction and expenditure activities of the project.
  • Review and vet invoices for fees and reimbursable expenses by the company and ascertain that:
  • Review the procurement process and procedures for all short term contracts for the period under review ascertain that:

o   Transparent and open systems are place to ensure negotiations for contracts (services, works and printing) are competitive and represent good value for money.
o   Appropriate procedures are in place to document and manage conflicts of interest that may arise from related party transactions.

  • Review the structure of BAA and ascertain that job functions are clearly defined and that no overlaps exist.
  • Review the asset register to ensure it is up to date and confirm that:

o   Supplies for direct purchases have been fully recorded with clear identifications marks.
o   The physical existence and conditions of assets in project sites.

  • Express an opinion on the cost effectiveness, accuracy and completeness (i.e value for money) of the financial transactions for the period under review.
  • Review the grant system set in place
  • Prepare a project expenditure report showing receipts and expenditure summaries from January 1, 2020 to December 31, 2020 and express an opinion on the financial transactions for the period covered.
  • Review the Terms of reference for the PIO grant (and subsequent amendments) to ascertain the extent to which BAA has complied with specific reporting requirements.
  • Bring to the attention of WorldFish and USAID any suspected fraud or irregularity or non compliant issue  that arises during the course of the audit and communicate matters that have come to attention during the audit which might have significant impact on the implementation of the Activity.
  • Perform tests to determine IP operations are in material compliance with agreement terms and applicable laws and regulations related to USAID programs and projects.
  • Perform tests to ensure compliance with local regulations in Bangladesh, including collection and payments of social security, Income Tax, Value Added Tax payments and reimbursement, etc.

4.   Deliverables

  • Engagement letter
  • Audit plan and schedule
  • Draft Report: The draft report with auditor’s observations, and management responses for USAID’s review.
  • Final Report: Audited financial report (four sets of hard copies and soft copies) for the period noted.
  • A management letter, which should highlight observed weaknesses in the system of internal control and the recommendations for managing the identified issues over the life of the Activity.
  • A statement of compliance with USAID terms and conditions as contained in the PIO grant.
  • All findings/observations must include the following steps:
    • a description of the condition (what is)
    • criteria (what should be)
    • the cause(s) (why it happened)
    • the effect/implication (what harm was caused by not complying with the criteria)
    • recommendations that correct the causes (s), and
    • management response
    • A verification report on Activity funded assets.

5.   Timing

The work is expected to commence no later than February 1, 2022, submit the first draft of the report by March 30, 2022 and the final report no later than April 30, 2022.

Submission details

Interested parties should submit a full technical and budget proposal to procurement.wfbd@worldfishcenter.org mentioning the title of the call for proposal in the subject line. The deadline for submission of the proposal will be on 20 January 2022.

Questions and Clarifications:

All questions and/or clarifications regarding this RFP must be submitted via email to Sally Mallari (email: S.Mallari@cgiar.org ) and copy to Sinthia.Shahrin@cgiar.org  no later than 19 January 2022.