2.9. Audit

Risks

• Terms of reference and contract with the audit are not up to Helvetas expectations.
• Contracting a “friendly” audit company, which produces poor quality and convenient audit reports (for example leaving out key information, reducing the weight of findings or providing irrelevant recommendations).
• The partner does not follow-up on the audit findings and recommendations.
• When audit is conducted by the National audit office, the report may not be specific to the project financed by Helvetas or not in line with Helvetas timelines.

Good practice

• Monitor implementation of the agreed rules regarding the review and approval of the Terms of reference, but also for following up on audit recommendations.
• The partner should approve the Terms of reference and take the full responsibility. If this is not possible due to capacity or institutional gaps, Helvetas can review and approve the Terms of reference.
• Ensure that the audit requirements in the Terms of reference are clearly understood and complete. Align the Terms of reference with internationally acceptable standards. Alternatively use and adapt the template of Helvetas or the donor.
• Ensure that the chosen audit firm has a proven track record. To do this, refer to the list of firms approved by donors, conduct market research, check references and CVs, etc.
• Include in the contract clauses similar to the collaboration agreement (audit requirements, including timelines, etc).
• Hold a kick-off meeting with auditors to explain expectations from all the parties involved.
• Monitor the schedule of the auditor.
• Ensure that the partner develops a plan to follow-up on audit findings and reports on addressing audit recommendations.
• Negotiate with National audit office possible adjustments to conduct audit for project purposes. If possible, contract the National audit office to conduct the audit. Otherwise, explore the idea of audit by a private firm.