1. finance
2. accounting and auditing

Jharkhand State Livelihoods Promotion Society
(Under the aegis of Rural Development Department, Govt. Of Jharkhand)
3rd Floor, FFP Building, HEC, Dhurwa, Ranchi-834004
Phone No. 0651-2401782 - 83
Email – [email protected], Website – www.jslps.org
No: 472/Ranchi
Dated: 27/05/2014.
EXPRESSION OF INTEREST FOR HIRING OF INTERNAL AUDITOR
The Jharkhand State Livelihood Promotion Society invites “Expression of Interest”
from the eligible registered Chartered Firm to submit their interest for providing
services for “Internal Auditor” for JSLPS.
Interested agencies may submit their "Expression of Interest" in a sealed
envelope clearly superscripted as Expression of Interest for “Consultancy services
for Internal Auditor” latest by 15.30 hours on 23rd June'2014. The agencies may
obtain further information and procedures for submitting the “Expression of Interest”
from the official website of JSLPS e.g. www. jslps.org.
Sd/Chief Executive Officer
Jharkhand State Livelihoods Promotion Society
(Under the aegis of Rural Development Department, Govt. Of Jharkhand)
3rd Floor, FFP Building, HEC, Dhurwa, Ranchi-834004
Phone No. 0651-2401782 - 83
Email – [email protected], Website – www.jslps.org
No: 472/Ranchi
Dated: 27/05/2014.
REQUEST FOR EXPRESSIONS OF INTEREST FOR HIRING OF AGENCY FOR INTERNAL AUDITOR IN
SRLM, JHARKHAND.
(CONSULTING SERVICES – FIRM SELECTION)
Ranchi, Jharkhand, India
National Rural Livelihood Mission
Loan No./Credit No./ Grant No.:4978-IN
Assignment Title: Consultancy Services for Internal Auditor.
Reference No: SRLM/08/2014-15.
The National Rural Livelihood Mission, Ministry of Rural Development, Govt. of India
financing from the World Bank toward the cost of the National Rural Livelihood Project
(NRLP) and intends to apply part of the proceeds for consulting services.
The consulting services (“the Services”) include hiring of Internal Auditor for JSLPS for
a period of three years. The details activities are mentioned in the Terms of Reference.
The Jharkhand State Livelihood Promotion Society (JSLPS), now invites eligible
consulting firms (“Consultants”) to indicate their interest for providing the services.
Interested Consultants should provide information demonstrating that they have the
required qualifications and relevant experience to perform the services. The short-listing
criteria are as follows.
a) The C.A. firm should be an Indian firm having independent legal existence,
registered under the applicable Act. [Submit proof of Registration Certificate,
Articles and Memorandum of Association].
b) The C.A. firm should minimum 10 years experience and should have an annual
turnover of Rs 50 Lakhs or more during last three financial years and preferably
a positive net worth. [Relevant documents viz, audited financial statements and
a certificate from Charted Accountant in support of satisfying the criteria should
be submitted].
c) Experience at least 3 similar assignments in areas specific to the proposed
assignment undertaken during last 5 years. Experience in government sector
especially in Rural Development Department, Govt. of Jharkhand may be
preferred.
d) The agency should have been empanelled with CAG.
e) The Agency should have a well qualified and sufficiently experienced faculty, in
house or should be in a position to commit about their own network/association.
f) The agency should furnish the complete details along with CVs of key
personnel who may be directly associated with the assignment. At least two of
the key personnel who are expected to work directly on the assignment should
be FCA. Past experience of key professionals in handling similar assignment
would be preferred and given weightage
Interested C.A. firm may submit their application expressing interest, to the JSLPS in
the prescribed proforma annexed herewith [Annexure A] in sealed envelope with each
page of the application signed by an authorised signatory, including the pages
comprising the annexure.
The attention of interested Consultants is drawn to paragraph 1.9 of the World Bank’s
Guidelines: Selection and Employment of Consultants [under IBRD Loans and IDA
Credits & Grants] by World Bank Borrowers under Selection of Consultant &
Employment, January,2011 (“Consultant Guidelines”). Consultants may associate with
other firms in the form of a joint venture or a sub consultancy to enhance their
qualifications.
A Consultant will be selected in accordance with the Quality & Cost Base Selection
(QCBS) method set out in the Consultant Guidelines.
Expressions of interest must be delivered in a written form to the address below by
person or through postal/courier services latest by 15.30 hours of 23rd June ,2014 in the
following address.
Address:
The Chief Executive Officer,
Jharkhand State Livelihoods Promotion Society
3rd Floor, Shantideep Tower, Off. Hotel Maharaja,
Radium Road, Ranchi-834001
Phone No. 0651-2360142/2360038
Email – [email protected],
Annexure-A
The Expression of Interest MUST be accompanied by all the relevant documents
in support of the statements or claims made in the application including:1) Brief description of the background and organization of your entity/firm(not
more than two page)
2) Brief description of ownership details, date and place of incorporation of the
firm,
objectives of the firm, total manpower strength- availability of
appropriate professional staff , infrastructure etc.
3) A write up on the understanding of the assignment (not more than two pages),
4) CVs of Key functionaries who would be associated with the assignment.
5) Evidence of registration/incorporation of the firm.
6) Annual Report of last 3 years.
7) Audited Financial Statements including Balance Sheet, Profit and loss account,
for the last three years,
8) A Self attested copy of the latest empanelment intimation letter issued by the
CAG containing the Unique Identification Number and the score.
9) A self declaration form from the firm to the effect that the firm including the
partners of the firm has not been found guilty of professional/other misconduct
by the Institute of Chartered Accountants of India under First and Second
Schedule of the Chartered Accountants Act 1949 or is one against whom no
disciplinary sanction order have been passed by the Public Companies
Accounting Oversight Board. In case the firm has such partners, the firm
provides details of such partners and certifies that they will not be associated
with the audit in any manner.
10) Any response received after the due date or not found to be in accordance with
the above procedure, is liable to be rejected outright and the decision of the
JSLPSS in this regard shall be final.
11) The proposal containing EOI should be addressed to the Chief Executive
Officer, JSLPS, The proposal in sealed envelope containing EOI along with the
annexure should reach the addressee within the stipulated date mentioned in
the advertisement.
Draft Terms of Reference for Internal Audit for JSLPS
1) Background:
Government of India has restructured the SGSY as National Rural Livelihoods Mission
(NRLM) which will be implemented in a mission mode across the country with 25%
financial participation of State Governments. In Jharkhand, the program is being
implemented through Jharkhand State Livelihoods Promotion Society (JSLPS)
Besides, NRLM activities , the Society is also implementing other important schemes
on rural development sanctioned by the Government of Jharkhand and Government of
India like Sanjivini Project, Socio-Economic and Caste Census(SECC), Special
SGSY, Adarsha Gram Yojana etc. . In order to audit the above activities at various
level, JSLPS is going to hire an audit firm, who will audit the activities as well as
expenditure of JSLPS.
2)
Objectives of the Audit:
The objectives of the internal audit to enable the auditor to express a professional
opinion on the effectiveness of the overall financial management and procurement
arrangements. It has to be ensured that the overall financial management and
arrangements including the system of internal controls as documented in the Financial
Manual (FM), Community Operational Manual (COM), Procurement Manual and Project
Implementation Plan (PIP) are in practice, effective and adequate. It is expected that the
process of audit shall be in position to provide to the project management with timely
information on financial management aspects of the mission, including internal controls
and compliance with financing agreements, to enable follow-up action.
In addition, it is expected that internal audit should play a role in assisting
management with mis utilization of fund, including the prevention, detection and
investigation of fraud as part of “bringing a systematic, disciplined approach to
evaluate and improve the effectiveness of risk management, control and governance
processes.
3)
Period of Audit:
Period of Audit shall be for a period of 3 years w.e.f financial year 2014-15. Initial
period of agreement shall be made for a period of one year and will be extended for a
further period of 2 years based on the performance. During 1 st year, the audit has to
be conducted for entire year. 1st quarterly audit would be commence in the month of
July 214.
4)
Selection process based on QCBS
The Auditors will be selected based on Quality & Cost Based Selection (QCBS) of NRLM
procurement guidelines.
5) Coverage and Standards for the Audit: The internal audit should be carried out in
accordance with the Auditing & Assurance Standards prescribed by the Institute of
Chartered Accountants of India and will include such tests and controls, as the
auditor considers necessary under the circumstances.
6) Scope of the work:
The specific areas coverage of the audit will include the following:
a) State Mission Management Unit (SMMU):
During conducting the audit, special attention should be given to assessing
whether adequate controls have been established and complied with to ensure
that:
 All funds have been used in accordance with the conditions of the relevant legal
agreements’ and only for the purposes for which the financing was provided.
 All necessary supporting documents, records, and accounts have been kept in
respect of all project transactions including expenditures reported via Interim
Unaudited Financial Reports (IUFR). To ascertain that IUFR are as per books of
records of SMMU and as reported by DMMUs.
 Missions assets are adequately safeguarded and used solely for their intended
purposes with proper records and documents.
b) Coverage of audit extends:
 An assessment of the adequacy of the mission financial management systems,
including internal controls. This would include aspects such as adequacy and
effectiveness of accounting, financial and operational controls and any needs
for revision; level of compliance with established policies, plan and procedures;
reliability of accounting systems, data and financial reports; creating controls
mechanism in areas where they are lacking; verification of assets and liabilities,
security and effectiveness of the operation of the computerized system and,
 Efficiency and timeliness of the funds flow mechanism at the SMMU and
DMMUs and to the Community Institutions. (Through compilation and
consolidation of report till district level.)
 Whether the accounts of the mission are complied in a timely manner and the
expenditures consolidated on a monthly/quarterly basis at the SMMU level.
 An assessment of compliance with provisions of those relating to procurement,
accounting and financial matters.
 Goods, works and services have been procured in accordance with the NRLM
procurement guidelines, procurement manual of JSLPS and financing
agreements;
 Verify payment to the consultants as per agreement.
 All necessary supporting documents, records, and accounts have been kept in
respect of all Mission activities and that clear synchronizations exist between
accounting records, accounts books and the periodic financial reports (internal
and external i.e. Interim unaudited Financial Reports)
 Adequate records are maintained regarding the assets created and assets
acquired by the Mission, including details of cost, identification and location of
assets.
 All funds received under the Mission have been used in accordance with the
financing agreements, with due attention to economy, efficiency and
effectiveness, and only for the purposes for which the financing was provided;
 The auditor is expected to obtain and satisfactorily document sufficient audit
evidence to support audit conclusions.
 Inter unit fund transfers and Bank reconciliations have been carried out on a
monthly basis.
 Whether District offices maintain an updated database of audit reports received
and take follow-up action on delayed or inadequate reports, audit observations
etc.
 Internal auditors to summarize key issues and risks from a review of DMMU
audit report.
 Auditor will also provide variance report as per approved annual action plan and
budget.
c) District Mission Management unit (DMMU):
During conducting the audit, special attention should be taken to assess, whether
adequate controls have been established and complied with to ensure that:
 All funds have been used in accordance with the conditions of the relevant legal
agreements’ and only for the purposes for which the financing was provided;
 All necessary supporting documents, records, and accounts have been kept in
respect of all project transactions including expenditures reported via Interim
Unaudited Financial Reports (IUFR). To ascertain that IUFR are as per books of
records and submitted in prescribed format to SMMU by DMMU.
 Mission assets are adequately safeguarded and used solely for their intended
purposes; and
 Risk assessment report be prepared by the auditor in the first quarterly report:
 Identifying what are the risks in the mission
 Assessment of risk (High, Medium, Low).
 Ensure that there is an appropriate response to all risks.
 Informing the authority about the risks which are outside acceptable limits,
usually those which are to be tolerated or taken for the potential risk
 An assessment of the adequacy of the Mission financial management systems,
including internal controls. This would include aspects such as adequacy and
effectiveness of accounting, financial and operational controls, and any needs
for revision; level of compliance with established policies, plan and procedures;
reliability of accounting systems, data and financial reports; methods of
remedying weak controls or creating controls in areas where they are lacking;
verification of assets and liabilities.
 Efficiency and timeliness of the funds flow mechanism at the DMMUs and to the
SHGs / Community Institutions.(through compilation and consolidation of report
up to VO level.). Analyze and submit report on fund utilization of RF/ CIF at
SHG / V.O. level.
 Whether the fund/ tranche released to the Community Institutions are properly
recommended by the officer in BMMU and approved by the DMMU having the
necessary authority, and the conditions (triggers/ graduation criteria) for tranche
release (as provided in the COM for various funds) have been complied and are
in line with the financing agreement, with the NRLM. Whether milestones have
been reached before release of fund to CBOs.
 Whether the accounts of the Mission are complied in a timely manner and the
expenditures consolidated on a monthly basis at the DMMU level and submitted
to SMMU. All Transaction relating to the prior /previous month accounted in the
month under audit be separately reported.
 Goods, works and services financed have been procured in accordance with
the NRLM procurement guidelines, financial & procurement manual of JSLPS
and financing agreements;
 All necessary supporting documents, records, and accounts have been kept in
respect of all Mission activities and that clear synchronizations exists between
accounting records, accounts books and the periodic financial reports
 Adequate records are maintained regarding the assets created and assets
acquired by the project, including details of cost, identification and location of
assets and verification of assets created out of the Mission and comment on
its utilization;
 The auditor is expected to obtain sufficient documentary audit evidence to
support their audit observation/ conclusions.
 Inter unit fund transfers and Bank reconciliations have been carried out on a
monthly basis.
 Internal auditors to summarize key issues and risks from a review of a sample
of village audit reports and comment on actions taken by DMMU/BMMU.
 Certify the Mission financial statements on quarterly and annual basis for the
unit audited.
 The auditor or his representative shall be required to put the certificate with date
on all manual records and books of accounts of being verified. Any record not
found to have the stamp shall be considered as not verified and deficiency in
audit on the part of auditor.
 Auditor will verify the documents/ physical verification of fixed assets/stock at
BMMU.
 Auditor will verify the no. of CBOs / Federations to whom fund transferred
during the quarter and no. of CBOs / Federations reported in IUFR.
 Verification of cash scroll register at each unit and report for any deviation as
per FM.
7) Data, services and facilities to be provided by JSLPS:
a. All the Mission documents, copy of agreement and relevant papers
needed for Audit will be provided by the JSLPS. The auditor would be
given access to all documents, correspondence, and any other information
relating to the Mission and deemed necessary by the auditor for carrying
out audit.
b. The auditor would be provided copies of the Project Implementation Plan,
the Community Operations Manual, and Financial Management Manuals,
guidelines, policies and procedures issued by Project Management. They
shall also be provided with relevant NRLM policies and guidelines.
C. One day workshop will be organized by JSLPS for giving details of
Mission. It should be attended by all the members of audit team.
8) Period, Timing and Coverage of Internal Audit:
The Internal Audit of (SMMU) head office and (DMMUs) District units should be
conducted on quarterly basis from April 1st 2014 and subsequently for two years
of 2015-16 and 2016-17. 100% vouching shall be require for Internal Audit.
The selected firm(s) will submit audit plan in consultation with SMMU in advance and
agree with SMMU a schedule of Audit. The contract will be renewed after assessing the
pace of implementation, the Missions needs and performance of the consultant for next
one year on the existing terms and conditions till end of 3 years.
The auditor should become familiar with the Mission activities and with the relevant
policies and guidelines of the MoRD (including those relating to disbursements,
procurement and financial management and reporting).
The audit will be carried out on a quarterly basis.
9) Reporting:
Quarterly Reporting & Annual reporting at SMMU and DMMUs : The Auditor will
provide quarterly Audit report and a summary of the key findings, implications and
recommendations to enable the Mission Management to take timely action. The report
should be discussed and agreed with the JSLPS and should be structured in a manner
giving the observations, the implications of the observations, the suggested
recommendation and the management comments/ agreed actions. The audit
observations should be supported by instances and quantified, as far as practicable.
Quarterly and annual audit observation reports to be submitted each financial year.
The audit reports should be submitted within 45 days after completion of quarter. A
penalty of 0.50 % per week or part thereof shall be deducted from the bill of audit fee.
Any delay beyond 45 days for any quarterly report attracts the termination of the
contract without any financial liability of the client. The firm will give a Project
Management Letter to the Chief Executive Officer along with individual audit reports to
each of the auditable unit for compilation and future guidance.
Besides Project Management Letter to the Chief Executive Officer the internal auditor
of SMMU and DMMU should provide an executive summary highlighting the critical
issue which require the attention of CEO of JSLPS and status of action on previous
recommendation.
Format of the Management Letter: The Management Letter will inter alia have
the following sections  Objectives of the audit;
 Methodology of the audit;
 The status of implementation of the financial management system;
 The status of compliance of the previous audit reports, including major audit
observations pending compliance;
 The key areas of weaknesses that need improvement; and
 Recommendations for improvements.
Procedure of conducting audit.
1. The auditor shall inform before the start of Audit.
2. The auditor should give detailed work plan for conducting audit.
3. The auditor should make audit programme and plan for SMMU & DMMU in
coordination with the finance team
4. Feedback as necessary can be given to the management on the outcome of the
Audit from time to time. Information about any discrepancies can be shared with
the management for rectification/clarification.
5. During the audit the internal Audit team shall interact with management staff for
any clarification. For the clarification, the audit team will present their findings in
the common platform.
6. The auditor shall interact with the management before furnishing of any report.
7. The plan shall be finalized in consultation with management at SMMU level.
8. The detail approach and methodology should be provided by the auditor
themselves in the RFP.
10) Key Experts for the Assignment:
The list of key personnel’s whose CVs and experience would be evaluated for
empanelment is as follows:
S. No
Key
Description of Services
No. of
Professio
to be provided
Experience
perso
nals
ns
1
Partner/
Overall coordination, &
Qualified Chartered
1
Audit
planning, team
Accountant with at least 10
Manager
leadership, reporting,
years experience as a partner
liaison with client
with expertise in the area of
internal audit planning,
execution and reporting.
2
Audit
Responsibility to lead the Qualified Chartered
2
Team
audit teams in the field, Accountants with at least 5
Leader
planning and execution years experience in internal
of the audits, discussion audit with ability to lead the
with heads of offices, team and interact with senior
consolidation/compilatio level Govt officials
n
3
Team
member
Vouching
and CA (Inter) with 3 years of
verification of SMMU experience in Accounting,
and DMMU books of audit and report writing.
accounts
General
Time lines of conducting the audit will be as follows:
FY 2014-15
Quarter
Period of Audit
st
1 Quarter
April to June
4
Time line for submission of
15th August Reports
2nd Quarter
July to Sep
15th October
3rd Quarter
Oct to Dec
15th February
4th Quarter
Jan. to March
15th May
Final report of the audit will be submitted as per the timelines indicated above. The
written acceptance of the report by JSLPS will be considered as submission of the
Report.
Before start of the audit, the Consultant will issue Identity Card to every member of the
Audit team who have been proposed by the Auditors in the RFP. Any change in the
members due to unavoidable circumstances, will only be done by the consultant after
seeking prior ‘no objection from’. The change member should be of similar or higher
qualification. Any change in team without no objection from JSLPS will not be eligible
for audit.
11) Composition of review committee and review procedure to monitor consultants
work
The proposed assignment will be reviewed and monitored by a review committee on a
quarterly basis and take further remedial measures on the discrepancies pointed out in
internal audit constituted by JSLPS. A nodal person will be deputed to interact with the
Auditor.