Request for audit services for Accountable Entity (AE) and foreign organizations without access to Independent Public Accounting Firms

BLANKET PURCHASE ORDER DESCRIPTION This blanket purchase order (BPA) requests audit services for Accountable Entities (AE) and foreign organizations without access to Independent Public Accountant firms to conduct audit and review engagements in accordance with U.S. GAGAS and other applicable standards. INTRODUCTION In many countries, the access to Independent Public Accountant (IPA) firms to conduct audit and review engagements in accordance with U.S. GAGAS is very limited or nonexistent. Due to MCC’s reliance on the financial reporting from accountable entities (AE) and foreign organizations to produce its financial statements and data, MCC must have reasonable assurance that the AE financial reports are reliable and accurate. Sufficiently robust audits of that financial reporting by qualified Independent Public Accounting firms (IPA) are a central component of building that assurance. AUDIT OBJECTIVE The primary objective of this engagement is for the contractor to provide auditing services to conduct financial audits of the MCC resources managed by the AE/foreign organization and other recipient organizations under the MCC-funded grants described in this Terms of Reference, as well as conduct audits of other MCC-funded grants, contracts, and implementing agreements in accordance with the U.S. Government Auditing Standards issued by the Comptroller General of the United States and the “Audit Reference Overview”. The Audit Reference Overview on which these terms of reference is based can be and is subject to modification at any time at the discretion of MCC. A financial audit of the funds managed by recipient organizations under MCC-funded grants, contracts, and implementing agreements must be performed in accordance with U.S. Government Auditing Standards, or other approved standards where applicable, and accordingly must include such tests of the accounting records as deemed necessary under the circumstances. The specific objectives of the audit of resources managed by AE/foreign organizations and its Covered Providers, if applicable, are to: Express an opinion on whether the Fund Accountability Statement for the MCC-funded programs presents fairly, in all material respects, revenues received, costs incurred, assets and technical assistance directly procured by MCC and the Government (including by the AE/foreign organization and its Covered Providers, if applicable) for the period audited in accordance with MCC rules and regulations, other implementation guidance, and the terms of the CDF, CFF, Compact or Threshold Program, related agreements, conditions of award, and generally accepted accounting principles or other comprehensive basis of accounting (including the cash receipts and disbursements basis and modifications of the cash basis). Evaluate and obtain a sufficient understanding of the Accountable Entity’s internal controls related to AE/foreign organization’s development and implementation of the Compact or Threshold Program using both MCC and Government funds, assess control risk, and identify significant deficiencies or material weaknesses in the design and effectiveness of these internal controls. This evaluation should include the internal control related to required cost-sharing contributions and Government contributions required for the Compact or Threshold Program. Perform tests to determine whether AE/foreign organization complied, in all material respects, with the CDF, CFF, Threshold Program Development Funding Agreement, Compact or Threshold Program (including those MCC rules and regulations regarding Government Contributions), supplemental agreements, and applicable laws and regulations related to MCC-funded grants. All material instances of noncompliance and all illegal acts that have occurred or are likely to have occurred should be identified. Such tests should include the compliance requirements related to the required cost-sharing contributions, if applicable. Specifically, the auditor shall perform tests to determine whether AE/foreign organizations complied, in all material respects, with the MCC Program Procurement Guidelines, the MCC Cost Principles for Government Affiliates, AE/foreign organizations’ s Fiscal Accountability Plan or other similar plans in effect during the audit period, and the terms and conditions of the MCC-funded grant. Determine whether the accountable entity has taken adequate corrective action on prior audit report recommendations, if applicable. Auditors must design audit steps and procedures in accordance with U.S. Government Auditing Standards (GAS), to provide reasonable assurance of detecting instances or transactions in which fraud or illegal acts have occurred or are likely to have occurred. If such evidence exists, the auditors must contact MCC AFC Hotline at hotline@mcc.gov and report the issue to the OIG hotline at https://oig.usaid.gov/report-fraud . In addition, the auditor should exercise due professional care in pursuing indications of possible fraud and illegal acts so as not to interfere with potential future investigations or legal proceedings. If applicable, conduct a review engagement of the cost-sharing schedule to determine if the sched­ule is fairly presented in accordance with the basis of accounting used by the AE/foreign organization to prepare the schedule and to: determine whether cost-sharing contributions were provided and accounted for by the Accountable Entity in accordance with the terms of the agreements; and question all cost-sharing contributions that are either ineligible or unsupported costs. SCOPE OF THE ASSIGNMENT The Auditor should use the following steps as the basis for preparing their audit programs. These steps are not all-inclusive or intended to be restrictive in nature and do not constitute relief from exercising professional judgment and due professional care. The steps should be modified to address local conditions and specific progra…