German Doctors e.V. is an internationally active non-governmental organization (NGO) which sends volunteer doctors to projects in different countries. German Doctors advocates a life in dignity and provides healthcare services and training for disadvantaged people in our operational areas. It also strives to improve the health of our patients over the long run through prevention programs, accompanying nutrition programs, and training in hygiene. It helps to all individuals, regardless of prestige, ethnic origin, religion, nationality, political conviction, or any other differentiating characteristic. Doctors of German Doctors perform missions for 6 weeks either during their annual holidays or after retirement and receive no remuneration. Over 7000 missions with more than 3,100 doctors have been performed since 1983. German Doctors has been offering patients continuous help for over 30 years. In Sierra Leone German Doctors e.V. has been working since 2010 in partnerships with different NGOs. German Doctors e.V. has decided to appoint an independent third-party auditor with the necessary qualifications and experience to conduct financial and management audit for a possible partner in Masanga, Sierra Leone.

In 1964 the GoSL established Masanga Leprosy Hospital in Tonkolili District, Northern Province. Soon after the opening the hospital developed an international reputation for treating Leprosy, it owes its remote jungle location partly to the fear that Leprosy could engender half a century ago. Until 1997 the Seven Day Adventist Church ran the hospital as a Leprosy institute.

During the civil unrest, the hospital was occupied and heavily damaged by the rebels. In 2006 the hospital re-opened with support of the Danish Organization Association Friends of Masanga (AFOM) and the English based Sierra Leonean Adventists Abroad (SLAA).The two organizations signed a Memorandum of Understanding (MoU) with the GoSL on Tuesday 13^th of July 2006. In the MoU both NGO’s were held responsible to rehabilitate and manage Masanga Hospital. Since then permanent and rotating staff both National and expatriate have been working to do so.

The hospital offers free health care to Leprosy patients, under five children, lactating and pregnant women. To enable the hospital to provide affordable care to all in a sustainable fashion, a cost recovery system was installed in 2012 to all other patients.

Since 2006 Masanga Leprosy Hospital health facility has now been transformed into a 100 beds general hospital and established as a teaching platform to build the medical expertise of health care workers.

Purpose and objective of the Audit

Through this audit the audit firm will confirm the accuracy of Masanga Hospitals accounts and annual financial statements. The audit should review the system and procedure of Masanga Hospitals accounting and financial management and make comments, express their opinion and give recommendations. It will check if all amounts received by partners and cost incurred in 2022 are in accordance with the relevant policy of the organization, national policies or German Doctors.  It will see whether financial statements are up to date, error-free, trustworthy, and indicate the right picture with regards to the organization’s financial health.

The external auditor will provide a different perspective regarding accounting and financial processes, austerity maintenance, optimal resource utilization and others for the benefit of the concerned partners as well as of German Doctors. At the end of audit, the auditor will generate a report of findings, which provides an overall picture of its financial standings.

Audit Scope and assignment

The scope of the Audit is to check the income provided and costs incurred through the original vouchers and other related project documents (contracts, agreements…), based on the annual plan/program and financing plan and in accordance with International Standards on Auditing (ISAs). This will review income and expenditures for the period of one calendar year i.e. from January 2022 to December 2022.  However, in consultation with the auditor, the period for audit may be changed. The auditor should verify the report by the means of;

• 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
• Checking and verification of the inventory /fixed assets lists.
• Checking and verifying whether the compliance with local applicable laws is made or not, verify the quantitative and qualitative program reports, review of compliance with laws, regulations and other external requirements, management policies and directives and other internal requirements.
• The audit should be carried out in accordance with local and international auditing standards.

Audit Methodology

For the purpose of presenting the true and fair view on the financial statement/reports the auditor shall conduct accuracy checks, observations, review of records and document, and interviewing beneficiaries, inquiry and analysis, recommendation, comparison, including:

• Visit Masanga Hospitals office(s) and review vouchers, invoices and all supporting documents for all the amount expensed and income receipt
• Review staff, rental, and other relevant contracts
• Review of payroll and tax compliance
• Review policies and compliances

Procedure

Following the completion of the hiring process the selected auditor will start the audit process which includes the following steps:

A. Inception/planning: The auditor should propose the plan and agree on a timeline

B. Auditing:

• • The auditor must audit the financial transactions of Masanga Hospital for the financial period
  • Primary discussion on findings with Masanga Hospital and German Doctors (Country Representative Sierra Leone).
  • Preparation of draft report and issue report for management comment on agreed timeline.
  • Receipt of Final Management Comments from German Doctors Head Quarters in Bonn
  • Finalize the Management letters: Masanga Hospital and the auditor.
  • Finalization of report and issue final audit report with certified statements and a management letter for the audited year.
  • Sign the Final Report

C . Final Reporting:

The final audit report should be submitted to German Doctors no later than

22.12.2023.

Audit Report and Management Letter

A. Audit Report

The audit report should include the following:

• An introduction containing: name of the organization audited, financial information, period covered, statement of the responsibility of the organization as well as the responsibility of the auditor.
• A paragraph on the nature of the audit mentioning the accounting standards applied and effect of any deviations from standards and the work performed.
• A paragraph of opinion disclosing the findings of the audit, which show the fairness of financial statements and supporting documents and indicates whether the funds received from donor partners and others were used in professional ways and for the purposes defined. Also, indicate financial regulations, procedures, budgetary provisions and other applicable directives.
• A summary assessment of the efficiency of the management and internal control system of Masanga Hospital.

The auditor may expand the report to include other information and explanations not intended as a reservation. Audit reports will be provided in English.

 B. Management Letter

The auditor should submit a letter to the management at the completion of the audit. The topics/issues to be covered in the letter should include:

• Comments and observations on accounting records, procedures, systems and controls;
• Assessment of the efficiency of the administration, management and internal control;
• Description of specific internal control weaknesses noted in the financial management.
• Recommendations to resolve/eliminate the internal control weaknesses;
• Management comments/response to audit findings and recommendations;
• Report on the degree of compliance with each of the financial, legal and contractual compliances and external matters affecting such compliance;
• Issues noticed by the auditor during the audit which might have significant impact on the implementation and sustainability of the program;
• Any other issues the auditor finds relevant from their professional judgment;

Debriefing Meeting

The Auditor/Audit Team should conduct a debriefing meeting for relevant program and finance staff and Management Committee Members regarding the audit in overall, response on the management letter, and auditor’s final view on the response of management.

Auditor’s Qualification

The auditor should not have any financial or close business relationships with any senior participant in the management of Masanga Hospital. The audit firm must be a Chartered Accountant and registered with the Institute of Chartered Accountants of Sierra Leone (ICASL). It should have at least five years of relevant professional experience in the audit of NGOs/INGOs and/or health institutions and have adequate staff with appropriate professional qualifications and suitable experience. Curriculum vitae (CVs) should be provided to German Doctors who would be part of the audit team. CVs should include details on relevant audits carried out by the applicable staff, including ongoing assignments indicating capability and capacity to undertake the audit and experience in auditing financial statements.