Term of Reference
Project Livelihood Rehabilitation and Disaster Risk Reduction on Post Sunda Strait Tsunami
External Auditor
INTRODUCTION
The worst affected area in Banten Province is Pandeglang district. Whereas the most severely affected sub-district in Pandeglang District is the Sumur Sub-district. Sumur District consists of seven villages namely Sumber Jaya, Kerta Jaya, Kertamukti, Cigorondong, Tunggal Jaya, Taman Jaya and Ujung Jaya. In these seven villages most of the residential, government office, public facilities such as education and health service centers, village economic activity centers and roads and bridges are standing right on the shoreline and facing the Sunda Strait directly.
Access to seven villages in the Sumur sub-district are quite difficult. It takes an hour by car to go to the farthest village, Ujung Jaya from sub-district centre in Sumber Jaya. About 80% of the road conditions in the seven villages are heavily damaged and muddy. While the travel time from Sumur Sub-district to Pandeglang, the capital of the district is about 4-hour by car with a hotmix paved road conditions. Until the third day after the Sunda Strait tsunami six of the seven villages in the Sumur sub-district were still isolated because road and bridges to the sub-district center and other villages were destroyed due to tsunami. Logistics assistance to villages was carried out by air and sea.
After the tsunami, the survivors discovered that there was a massive sale and purchase of land on the coast, especially in the districts of Sumur, Panimbang, Carita and Anyer by investors from Jakarta and Bandung. Land’s price after tsunami is fell by one-third from the normal price, in particular in Sumur subdistrict. This fact makes residents more resistant to the government's direction to vacate their former land on the shore without compensation from the government. In the government's plan, the land on the shoreline of the former settlement will be used as a green line. However, because these relocation efforts were carried out without temporary compensation, the residents' land were certified and the ownership was legal accordingly, the government's land clearing directives were ignored. Residents even prejudiced that their former land would be sold by the government to tourism investors instead of being converted into green lines.
Law enforcement by the government against citizens who insist on rebuilding houses on the shoreline/danger zone is not easy to do because residents are challenging the local government to regulate hotels and villas along the coast according to applicable regulation first.
In addition to relocation issue, which is currently on the process, there are also residents who are doubt to the local government on their performance of distributing aid from national governments during the emergency response period which is considered not transparent and unaccountable. Residents also questioned the clarity of boat assistance and production equipment for affected fishermen from the Ministry of Maritime Affairs and Fisheries whose data collection process has been carried out several times by Banten Provincial and Pandeglang District Fisheries and Fisheries Service employees. Residents are doubt to the local government ability to distribute the aid from the central government to affected fishermen transparently and accountably.
NAME PROJECT HOLDER: Yayasan KARINA (Caritas Indonesia)
PROGRAMME TITLE : Livelihood Rehabilitation and Disaster Risk Reduction on Post Sunda Strait Tsunami
DURATION: March 1, 2019 to February 28, 2020
BUDGET: IDR 2,609,815,000,- (EUR 165,144)
AUDIT PERIOD : April 1, 2020 to May 8, 2020
OBJECTIVES OF THE AUDITOR
The objectives of this external auditor are:
MAIN POINTS OF AUDIT
- The Financial information and reports accurately present, in all material respects, the actual expenditure incurred, and the revenue received by the Project Holder for the period March 1, 2019 to February 28, 2020, in conformity with the applicable Contractual Conditions set by donors (if applicable);
- The incomes and expenses, assets and liabilities are adequately supported by original documentation and have been properly accounted for; assets declared as used, the inventory systems show proofs of existence at the date of the agreement; the method applied for the conversion of local and foreign currencies into IDR is consistent with standard accounting practices.
- Adequate and effective internal control system exists.
- The audit work shall cover the adequacy of accounting and financial operations, reporting and management as well as accounting procedures (referring to the national law and the international accounting standards).
- A verification of mathematical accuracy is expected, in order to ensure that the expenditures described in the financial statements are reconciled with the supporting documents and with the bank statements.
- The period covered by the audit is: March 1, 2019 to February 28, 2020
- The audit will take place in Jakarta.
The audit methodology and the audit techniques to be used are those in accordance with international auditing standards and following the ISA 700 norm.
REPORTING
The audit report should include the following:
- Audit method used and the scope of the audit.
- Statement declares that all information and documentation needed to complete the audit has been made available as required.
- Declaration that the required audit standards that have been applied.
- Distribution and use of the audit report.
- Formal Opinion.
- The period covered by the report.
- Cash flow statement covering the project implementation period (please insert the exact period covered).
- Statement of receipts and expenditures covering the project implementation period (please insert the exact period covered).
- Income table by source of funding.
- The balance at the end of the implementation period.
- The auditor should submit a letter to the management at the completion of the audit. The management letter should include recommendations to address any weaknesses identified with regards to financial regularity, the internal control system, adherence to contract conditions and the effective use of financial resources.
- The audit report shall be written in Bahasa & English
The draft audit report should be submitted to the Caritas Indonesia (Yayasan KARINA) by April 30, 2020. The draft audit report will be reviewed by the Caritas Indonesia (Yayasan KARINA) before it is finalized and submitted. The final audit report should be released on May 8, 2020.
Note: Audit opinions must be one of the following: (a) qualified (negative), (b), unqualified (favorable), (c) adverse (negative), or (d) disclaimer (negative). If the audit opinion is other than “unqualified” (favorable) the audit report must describe both the nature and amount of the possible effects on the financial statements. The report should also make a reference to the section of the management letter with regard to the action taken or planned to be taken to address the issues underlying the qualification.
ELIGIBILITY OF THE AUDITOR
By agreeing these ToR the Auditor confirms that he/she meets at least one of the following conditions:
- The Auditor and/or the firm is a member of a national accounting or auditing body institution which in turn is a member of the International Federation of Accountants (IFAC).
- The Auditor and/or the firm is a member of a national accounting or auditing body institution. Although this organization is not a member of the IFAC, the Auditor commits him/herself to undertake this engagement in accordance with the IFAC standards and ethics set out in these ToR.
- The Auditor and/or the firm is registered as a statutory auditor in the public register of a public oversight body in a third country and this register is subject to the principles of public oversight as set out in the legislation of the country concerned (this applies to auditors and audit firms based in a third country).
