KANO STATE WATER BOARD- REQUEST FOR EXPRESSIONS OF INTEREST FOR EXTERNAL FINANCIAL AUDIT SERVICES
FEDERAL REPUBLIC OF NIGERIA
KANO STATE GOVERNMENT
3RD URBAN WATER SECTOR REFORM PROJECT IN KANO STATE
PROJECT EXTERNAL FINANCIAL AUDIT SERVICES
REQUEST FOR EXPRESSIONS OF INTEREST
The Kano State Government has received financing from the Agence Francaise de Developpement (“AFD”) to support the implementation of the 3rd National Urban Water Sector Reform Project in Kano State. The project will improve the water supply infrastructure, governance, and operation and maintenance capabilities of the Kano State Water Board (KnSWB) to provide improved water supply service to the Greater Kano area. The project Implementing Agency, KnSWB, on behalf of the Kano State Government, intends to use part of the funds thereof for payments for the following services under the project: Project External Financial Audit Services.
KnSWB now wishes to hire an experienced and qualified Audit Firm to provide External Financial Audit (EFA) Services. The objective of the EFA Services is to prepare annual project financial audits over the six-year life of the project, for submission to the Kano State Government and AFD. The first Audit is planned for approximately November 2020, with subsequent annual Audits to the Project close-out in 2025. The EFA Contract will include for six (6) Annual Audits. Services required for each Annual Audit Include but are not limited to:
(1) Conduct the audit in accordance with the International Standards on Auditing (ISAs) and express an opinion as to the reasonableness of the Project Financial Statements in all material respects, as well as include tests and verification procedures as the auditor may deem necessary.
(2) Review Project Financial Statements prepared by the Project Financial Management Unit (PFMU) and supporting accounting Information such as bank records. Statements of Expenditure (SOE) and others, and express an opinion on the Project Financial Statement in accordance with International Standards on Auditing (ISA).
(3) Review and express an opinion on the Statement of Expenditure (SOE) to confirm that project funds were utilized for the purpose intended, with due attention to economy, efficiency and effectiveness.
(4) Verify that project funds have been used in accordance with the terms and conditions of the AFD Credit Facility agreement, with due attention to economy, efficiency and effectiveness.
(5) Verify that expenditure of project funds has been approved at the correct levels of delegated Authority, including obtaining necessary AFD ‘No Objection Letters’.
(6) Verify that appropriate supporting documents, financial records and books of accounts relating to all project activities have been kept and that clear linkages exist between the books of accounts and the Project Financial Statements being audited.
(7) Establish whether the Project Financial Statements have been prepared in accordance with Generally Accepted Accounting Principles (GAAP) and International Public Sector Accounting Standards (IPSAS).
(8) Undertake a comprehensive assessment of the adequacy and effectiveness of the accounting and overall internal control system to monitor expenditures and other financial transactions.
(9) Include in the audit reports opinion on compliance with procedures designed to provide reasonable assurance of detecting misstatements due to errors or fraud that are material in the financial statements, as well as identify and comment on conditions that significantly indicate possible fraud and control risks.
(10) In addition to the Audit report, the External Auditor will be expected to prepare a Management Letter giving observations and comments, and providing recommendations for improvements in accounting records, systems controls and compliance with the FMS and financial covenants in the Credit Facility Agreement.
(11) The above services are to be provided on an annual basis for the 6-year life of the project, approximately starting November 2020 and ending 2025.
The External Financial Auditor will report to the State Government Project Steering Committee (PSC) and maintain Independence, both in fact and in appearance, of the Implementing entities being audited. The review of records shall be done on site, while the reports can be generated off-site. The estimated project expenditure over the 6-year life of the project for which audits shall be carried out is $75 million, composing contracts for works, goods and services and internal operational costs.
The Audit firm must be an independent, qualified and reputable auditing firm and must have at least ten (10) years of relevant and diversified professional experience in auditing with sizeable portfolio Including experience in financial auditing of government agencies and International donor funded projects.
The firm will preferably have experience conducting financial audits for major internationally funded infrastructure development projects in Nigeria, preferably in the water supply or utility sectors. As well, the firm should be familiar with procurement guidelines of the major Development Finance Institutions (DFIs), preferable those of the AFD or World Bank, and with FIDIC Conditions of Contract.
The firm must have clear knowledge and understanding of International Standards of Auditing and should possess internationally accepted quality assurance procedures and certifications, for example ISO or equivalent. The Audit Firm is required to have an office or a local affiliate based in Kano to provide for better communications and Interface with the Client.
The Firm must have a team of qualified audit experts with skill set needed to successfully undertake the audit assignment. Staff assigned by the Audit Firm shall include professional audit personnel certified and licensed to provide external audit services by the appropriate accounting bodies such as the Institute of Chartered Accountants of Nigeria (ICAN), the Association of National Accountants of Nigeria (ANAN) or other internationally recognized accounting designation that provides certification to practice accounting and prepare audits in Nigeria. These personnel need to have prior experience in financial audit of government agencies to international auditing standards (ISA) and on large internationally financed development projects.
The Audit assignment will be a lump-sum contract for all 6 audits based on Quality and Cost Based (QCBS) selection in accordance with AFD Procurement Guidelines.
The rough estimate of Key Experts’ time-input is: 20 person- months
This figure for person-months is, however, indicative only and will be confirmed in the Request for Proposals.
Kano State Water Board hereby invites Applicants to interest in delivering the Services described above.
This Request for Expressions of Interest (REOI) is open to: Audit Firms or Joint Venture of Audit Firms.
Eligibility criteria for AFD financed projects are specified in sub-clause 1.3 of the “Procurement Guidelines for AFD Financed Contracts in Foreign Countries”, available online on AFD’s website: http://www.afd.fr .
