HEAL Project - External Audit

IV. Subject of the Engagement
The subject of this engagement is the audit of the final Financial Statement(s) in connection
with the Grant Agreement. As per the EM24-008 Grant Agreement and Project Implementation
Contract with the Prime-Recipient of the Grant, the Entity has to carry out the Audit in one
term:
 The final audit of the project concerns the period of Life of the Project (LOP) covering
<February 1, 2024 to April 15, 2024>.
The Entity intends to engage one independent external auditor for the term of Project Audit
with the following key deliverables:
 Audit report
 Management letter
 Report on factual findings

V. Objective
1. The Auditors’ primary task is to verify the expenditure of EM24-008 project funds to
ensure that expenditure is supported by appropriate documentary evidence, that complies
with the EM24-008 Grant Agreement and ADRA International Project Implementation
Contract:
 Verification that relevant financial procedures are suitable designed and operating
effectively
 Verification of sound financial management and accuracy of bookkeeping based on
original vouchers
 Verification that the financial statements provide a true picture of the project’s finances
 Verification of plausibility of expense items
 Verification that the use of funds is by the objectives and results as outlined in the project
proposal
 Verification of compliance of expenses with budget items
 Verification that the relevant procedures have been applied following the agreement with
ADRA International
 Verification of stamping of the original voucher.
2. The Auditor must seek evidence on a sample basis and by the principles of legality and
regularity.

3. Where expenditure is not supported by sufficient documentary evidence, or where it is
not properly incurred, the Auditor has no discretion; he must report the matter and the
amounts as a proposed disallowance. The subsequent decision as to whether to issue a
recovery order is one made by ADRA International after considering all known
facts/mitigating circumstances leading to the provisional disallowance as reported by the
auditor. The Auditor plays no part in the decision on whether to issue a recovery order.

VI. Scope of Work and Reporting
1. The Audit will be performed at the ADRA Lebanon Office. The Auditor should confirm
the location(s) for the Audit with the Entity before the start of the Audit and ensure that
relevant supporting documents as well as key staff will be available during the Audit.
2. The audit shall be carried out by the standards specified in these terms of reference. It
shall include such tests and verification procedures as the Auditors consider necessary
under the circumstances and:
·         ISA 800 (Revised), Special Considerations – Audits of Financial Statements Prepared
by Special Purpose Frameworks and ISA 805 (Revised), Special Considerations–Audits of
Single Financial Statements and Specific Elements, Accounts or Items of a Financial
Statement.
·         By the International Standard on Related Services (‘ISRS’) 4400 Engagements to
perform Agreed-upon Procedures Regarding Financial Information as promulgated by the
IFAC; in compliance with the Code of Ethics for Professional Accountants issued by the
IFAC. Although ISRS 4400 provides that independence is not a requirement for agreed-upon
procedures engagements, ADRA International requires that the Auditor also comply with
the independence requirements of the Code of Ethics for Professional Accountants (the
IESBA Code) issued by the International Ethics Standards Board.