EXTERNAL AUDIT FOR THE PERIOD 2023-2025

1. INTRODUCTION AND BACKGROUND

The Tanzania Human Rights Defenders Coalition (THRDC) is a non-governmental, non- partisan and human rights organization formed by human rights focused organizations purposely to protect and promote the rights of human rights defenders in Tanzania. Strategically the Coalition strives to ensure the HRDs’ working environment is secured to ensure their smooth operations in Tanzania. THRDC is comprised of organizational members with its representation both from Mainland and Zanzibar (200) who are all human rights defenders (HRDs) in Tanzania. THRDC has, through its members, a national representation. Also, through designated zonal coordinating units (ZCUs) in eleven geographical zones, THRDC ensures that HRDs’ protection is cascaded down to grassroot level and strives to ascertain timely and effective- protection provision to HRDs in need. Please visit https://thrdc.or.tz for more details about our organization.

The following are the terms of reference (‘ToR’) on which the THRDC agrees to engage audit firm ‘the Auditor’ to perform an External Audit and to report in connection with the Agreement with concerning the organization activities.

2. OBJECTIVES AND SCOPE OF THE AUDIT ENGAGEMENT:

The main objective of the engagement is to express an independent audit opinion on the annual financial summary statements of THRDC for the period of 2023-2025. The auditor will carry out the audit in accordance with the International Standards on Auditing (ISA 200-799), (ISA 800/805), as promulgated by the International Federation of Accountants (IFAC) or national audit standards.

The scope of the audit shall include the following additional areas to be reviewed by the auditor;

i) Observe whether the financial report is structured in a way that allows for direct comparison with the latest annual approved budget and report on the variances.

  1. ii)  The annual audit engagement shall include reporting of the Internal audit findings action plan covering the first half of the year, conducted in October/November and previous annual audit findings.

  2. iii)  A disclosure of exchange gains/losses. Inquire and confirm whether the disclosure includes the entire chain of currency exchange from income sources to the handling of the projects/programmes within the organization in local currency/ies

  3. iv)  When applicable, compare if the opening fund balance for the reporting period matches with what was stated as closing fund balance in the previous reporting period.

  4. v)  Explanatory notes (such as, for instance, accounting principles applied for the financial report).

  5. vi)  Inquire and inspect posting of salary costs throughout the reporting period and their allocation to respective projects/programs.

3. PREPARATION AND VERIFICATION OF ANNUAL FINANCIAL STATEMENTS

THRDC is responsible for the preparation of annual financial statements in accordance with IPSAS including adequate disclosure and adopting generally acceptable accounting policies.

The auditor should verify that the Annual Financial Summary Statements (AFSS) has been prepared in accordance with the agreed accounting standards and give a true and fair view of the financial position encompassing both incomes and expenditures as of the financial year end.

The auditor should verify the financial report by the means of;

  1. i)  Checking and verifying whether the appropriate supporting documents, records and books of accounts relating to all project activities have been kept and whether these documents clearly relate to the activities they were assigned for.

  2. ii)  Review financial transactions, including income and expenditure for the audit period.

  3. iii)  Evaluate the effectiveness of internal controls and risk management processes.

  4. iv)  Examine compliance with relevant laws, regulations, and organizational policies.

  5. v)  Checking the accuracy and completeness of financial records and statements.

  6. vi)  Checking and verification of the inventory /Fixed Assets lists and in line with the THRDC’s policy.

vii)Identify any irregularities, discrepancies, or potential areas of improvement.

3. AUDIT METHODOLOGY:

In order to present the true and fair view on the financial statement/reports the auditor shall conduct accuracy checks, observations, inspection of records and document, and interviewing the beneficiaries, inquiry and analysis, recommendation, comparison, , including:

  1. i)  Visit the office and review vouchers, invoices and all supporting documents for all the amount expensed and income receipt.

  2. ii)  Review donors, consultants, staff, rental, and another relevant contracts if any

  3. iii)  Review of payroll and tax compliance

  4. iv)  Review THRDC policies and compliances

  5. v)  Review Annual budgets and work plan.

  6. vi)  Review the assets register.

  7. vii)  Review programs reports and other narrative reports.

viii) As part of the audit process, the auditor may request from the Partners written

confirmation concerning representations made in connection with the audit.

4. PROCEDURE:

The Auditor will start the audit process passing through the following major phases:

  1. Inception/planning phase

  2. Auditing:

    1. i)  The auditor must audit the financial transactions of THRDC for the financial period and primary discussion on findings.

    2. ii)  Preparation of draft report and issue the draft report for management comment on agreed timeline.

    3. iii)  Receipt of Final Management Comments from THRDC

    4. iv)  Finalize the Management letters: THRDC and auditors.

    5. v)  Finalization of report and issue final audit report with certified statements and a

      management letter for the financial year.

    6. vi)  Sign the Final Report

5. AUDIT REPORT

The auditor will issue an opinion on the set of THRDC Financial statements. The Auditor will prepare the audit report on the Statutory audit prescribed format.

6. MANAGEMENT LETTER

In addition to the audit report, the auditor will prepare a management letter, in which the auditor shall:

C. Final Reporting: The final audit report should be submitted to THRDC not later than 15th March each year.

  1. i)  The auditor shall submit a management letter, which shall contain both significant and other audit findings and recommendations made during the audit process. It should also state which measures that have been taken as a result of previous audits and whether measures taken have been adequate to deal with reported shortcomings.

  2. ii)  Give comments and observations on the accounting records, systems and controls that were examined during the course of the audit.

  3. iii)  Identify specific deficiencies or areas of weakness in systems and controls and make recommendations for their improvement.

  4. iv)  Report on the degree of compliance in the Donors agreement and give comments, if any, on internal and external matters affecting such compliance.

  5. v)  Communicate matters that have come to his/her attention during the audit which might have a significant impact on the implementation.

  6. vi)  Give comments on the extent to which outstanding issues/qualifications issues have been addressed.

  7. vii)  Give comments on previous audits’ recommendations that have not been satisfactorily implemented; and

  8. viii)  Bring to the management attention any other matters that the auditor considers pertinent,

7. ELIGIBILITY CRITERIA FOR EXTERNAL AUDITOR AND TEAM

The audit shall be carried out by an external, independent, and qualified Chartered Accountancy firm registered and licensed by the National Board of Accountants and Auditors (NBAA) in Tanzania. The Chartered Accountancy firm shall be a reputable accounting firm with minimum 5 years’ experience in Audit Practice, and a team comprising of qualified Chartered Accountants having exposure to development agencies and Local or International Non-Governmental Organizations (NGOs/INGOs).

8. AUDIT FEE/ REMUNERATION

• Annual Fee
The eligible and interested firms shall quote their best annual fee detailing out their Human

Resource requirement basis for Annual audit for the year 2023.

• Reimbursement

Travel , accommodation, and food will be covered by the Auditor and not separate of the Audit fee.

• Extra Fee
In the case of additional audit/documentation requirements instructed by THRDC, an extra fee will

be negotiated.

• Application
All application must be submitted through electronically to info@thrdc.or.tz by 3rd October

2023.

All correspondence should be addressed to

National Coordinator,
Tanzania Human Rights Defenders Coalition (THRDC), P. O. Box 105926,
Mikocheni, Near Hekima Garden | Dar es Salaam

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