ACF Audit Report Reviewed With ACF Response

UNITED NATIONS DEVELOPMENT PROGRAMME OFFICE FOR COORDINATION OF HUMANITARIAN AFFAIRS
AUDIT REPORT ON EMERGENCY RESPONSE TO AND MITIGATION OF CHOLERA OUTBREAK IN MOROTO DISTRICT KARAMOJA REGION, UGANDA FOR THE SIX MONTHS ENDED 31ST DECEMBER 2010. FUNDED BY; EMERGENCY RESPONSE FUND FOR UGANDA IMPLEMENTED BY; ACTION AGAINST HUNGER (ACF-USA) CONTRACT NO. ERF-DMA-0468-001
PREPARED BY; BAKER TILLY MERALIS Certified Public Accountants P.0 BOX 67486, Nairobi Kenya 1st Floor, New Rehema House, Rhapta Road, Westlands Tel: +254 20 444 2714 Email: reception@meraliscpa.com/dativa@utonline.co.ug
Draft audit report for the Emergency Response Fund (ERF) for Uganda: Emergency response to and mitigation of Cholera outbreak in Moroto district in Karamoja region implemented by Action Against Hunger (ACF-USA) for the six months ended 31st December 2010.
TABLE OF CONTENTS Page 1. LIST OF ACRONYMS................................................................................... .................. 2 2. PROJECT BAC ROUND...............................................................................................................3
3. STATEMENT OF PROGRAMME MANAGEMENT RESPONSIBILITIES................4 4. INDEPENDENT AUDITORS REPORT........................................................... .............5 4.1 CERTIFICATION OF STATEMENT OF EXPENDITURE 4.2 CERTIFICATION OF STATEMENT OF ASSETS AND EQUIPMENT 4.3 CERTIFICATION OF STATEMENT OF CASH POSITION 5. AUDIT SCOPE, METHODOLOGY AND PROCEDURES.........................................7 6. FUND ACCOUNTABILITY STATEMENT............................................. ...................11 7. STATEMENT OF CASH POSITION...........................................................................12 8. STATEMENT OF ASSETS & EQUIPMENT...............................................................13 9. DETAILED STATEMENT OF EXPENDITURE......................................... ...............14 10. NOTES TO THE FUND ACCOUNTABILITY STATEMENT................................. .15 ANNEXES ANNEX 1: DETAILED FUND ACCOUNTABILITY STATEMENT ANNEX 3: MANAGEMENT LETTER SUMMARY OF FINDINGS DETAILED FINDINGS ANNEX 3: FIELD REPORT
1.0 LIST OF ACRONYMS a) ERF- Emergency Response Fund b) ACF- Action Against Hunger c) UN-OCHA- United Nations Office for Coordination of Humanitarian Affairs d) VHTs- Village Health Teams e) NGO- Non Government Organisation f) UNDP- United Nations Development Programme g) PHAST- Participatory Hygiene and Sanitary Transformation h) TOR- Terms of Reference i) BC- Branch Coordinator j) MOU- Memorandum of Understanding k) OCHA- Office for Coordination of Humanitarian Affairs l) WHO- World Health Organisation m) WASH- Water and Sanitation Hygiene n) DDMC- District Disaster Management Committee o) NFI- Non- Food Items p) HC- Health Center q) HC 11- Health Center 11 r) HC 111- Health Center 111 s) HC 1V- Health Center 1V
2.0 BRIEF BACKGROUND OF THE PROJECT The first cholera cases were admitted in Moroto Hospital on 21st April 2010 in the 16th epidemiological week. This was confirmed when results from four specimens taken to Central Public Health Laboratory were positive for Vibrio Cholera 01 bacteria. All the 6 sub counties in the district reported at least a suspected case. The highest number was recorded in Nadunget Sub County with 129 cases. This spread to other districts and by 22nd May 2010, 37 suspected cases were reported in Kotido at Panyangara, Nakapelemum & Kotido sub counties. The epidemic continued to spread with a total of 397 cumulative cases and 7 deaths recorded in Moroto district by 25th of May 2010. The main driver of the epidemic was the extremely poor living conditions in the community characterized by strong poverty, cultural and behavioural attitudes, illiteracy, overcrowding and a sense of dependency. Specifically, the state of sanitation and hygiene is utterly poor; open defecation is widely practiced. Because of the lack of funds or limitations of the local District Water Office capacity to manage the situation, ACFs role was to fill the gap in water sanitation and hygiene promotion activities through coordination with other partners to avoid duplication. The project overall objective was to prevent and mitigate the spread of cholera through improved WASH conditions access, and social mobilization of the communities and institutions in Moroto district, Karamoja Region and the specific objectives included but not limited to ensure that 70% of safe water supply at household/ manyatta levels, are functional during and after three months of the project implementation, the percentage of household/manyattas and institutions levels and sanitation and hygiene practices to increase from 10% and 4% to 40% respectively, and finally 60% of communities/manyattas local leaders capacity to be built on the effective management in the prevention of cholera and related disease. The key project outputs are hereunder; a) At least 15,000 people had improved use and management of Water Sanitation and Hygiene (WASH) services at village/manyatta and institutions. b) At least 12,000 people had improved access to WASH infrastructure in villages/manyattas, schools and health centers c) Capacity of at least 150 key and influential people from the local community reinforced in prevention of cholera and water related diseases.
3.0 STATEMENT OF PROJECT MANAGEMENTS RESPONSIBILITIES
The United Nations Office for Co-ordination of Humanitarian Affairs (UN-OCHA) regulations require managers of the projects they fund to prepare Fund Accountability Statements, which give a true and fair view of the state of affairs of the project. It is thus the responsibility of the management of Action Against Hunger (ACF), the implementing agency of the Emergency Response Fund (ERF) for Uganda Project No. ERF-DMA-0468-001, to prepare Fund Accountability Statement. Action Against Hunger management is also required to ensure that the project keeps proper accounting records, which disclose with reasona ble accuracy the financial position of the project at any given time. The management is also responsible for safeguarding the assets acquired using the donor funds until the project is completed. The management is responsible for the preparation and fair presentation of these Financial Statements in accordance with the Emergency Response Fund (ERF) for Uganda Project Management Guidelines and the Project Agreement. This responsibility includes designing, implementing and maintaining internal controls relevant to the preparation and fair presentation of Financial Statements, that are free from material misstatement, whether due to fraud or error, selecting and applying appropriate accounting policies, and making accounting estimates that are reasonable in the circumstances. The management of Action Against Hunger accepts responsibility for the Fund Accountability Statement, which has been prepared using appropriate accounting policies supported by reasonable and prudent judgments and estimates. The management is of the opinion that the Fund Accountability Statement gives true and fair view of the state of the financial affairs of the Project and of its operating results. The management further accepts responsibility for the maintenance of accounting records and adequate systems of internal financial controls, which may be relied upon in the preparation of the Fund Accountability Statement.
Approved by the Project management on ..... 2011 and signed by:
......................... ..................... Antoine Esclatine Country Director
....................................... ...... Tom Coogan Administration Coordinator
4.0 INDEPENDENT AUDITORS REPORT ON THE FINANCIAL STATEMENTS ERF/ACF FOR THE SIX MONTHS ENDED 31ST DECEMBER 2010. The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) Plot 24 Prince Charles Drive, Kololo P. O. Box 7184, Kampala, Uganda 4.1 Certification of Statement of Expenditure We have audited the accompanying Statement of Expenditure of the Emergency Response Fund project number ERF-DMA-0468-001 for the six months ended 31st December 2010. The statement is the responsibility of the management of the project. Our responsibility is to express an opinion on the statement based on our audit. We conducted our audit in accordance with International Standards of Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the statement. We believe our audit provides a reasonable basis for our opinion. Basis of Opinion Without qualifying our opinion, we wish to draw your attention to the fact that the Project Management had variations exceeding 10% on six line items of the project budget without seeking authorisation from OCHA as required under Article VII (5) of the MOU (Details in the Management Letter). In our opinion, the statement of expenditure presents fairly, in all material respects the expenditure of USD 100,000 incurred by the project for the six months ended 31st December 2010 in accordance with ERF accounting requirements. 4.2 Certification of Statement of Assets and Equipment We have audited the accompanying Statement of Assets and Equipment of the Emergency Response Fund project number ERF-DMA-0468-001 as at 31st December 2010. The statement is the responsibility of the management of the project. Our responsibility is to express an opinion on the statement based on our audit. We conducted our audit in accordance with International Standards of Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the statement. We believe our audit provides a reasonable basis for our opinion. 5
In our opinion, the statement of assets and equipment presents fairly, in all material respects the balance receivable of the project amounting to USD 20,000 as at 31st December 2010 in accordance with ERF requirements. 4.3 Certification of Statement of Cash Position We have audited the accompanying Statement of Cash Position of the Emergency Response project number ERF-DMA-0468-001 as at 31st December 2010. The statement is the responsibility of the management of the project. Our responsibility is to express an opinion on the statement based on our audit. We conducted our audit in accordance with International Standards of Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the statement. We believe our audit provides a reasonable basis for our opinion. Basis of opinion Without qualifying our audit opinion, we wish to state that ERF project funds were deposited on an existing ACF bank account used for other ACF activities. The bank balance as at 31st December 2010 in respect of this project was nil; given that ACF spent USD 100,000 on ERF activities which is in excess of USD 80,000 recieved. The balance for ERF is a deficit of USD 20,000. In our opinion, the statement of cash position presents fairly, in all material respects the cash deficit of the project amounting to USD 20,000 incurred by the project as at 31st December 2010 in accordance with ERF accounting requirements. This report is intended solely for the information and use of OCHA/UNDP and ACF management. Madhav Bhandari SIGNATURE: ............................................. BAKER TILLY MERALIS CERTIFIED PUBLIC ACCOUNTANTS Date of Issuance: ........................
5.0 AUDIT SCOPE, METHODOLOGY AND PROCEDURES According to the Terms of Reference (TOR) for this contract, the objectives of the audit of UN-OCHA funded projects (ACF) were to; 6
a) Enable the auditor express an opinion on whether the financial report presented by ACF presents fairly in all material respects, the financial performance of the ACF for the two months ended 31st December 2010, and compliance with the relevant laws and regulations. b) Document, evaluate and obtain sufficient understanding of the internal control structure of ACF, assess risks and identify reportable conditions, including material internal control weaknesses, their implication and recommendations for remedy. c) Perform tests to determine whether ACF complied, in all material respects, with agreement terms and applicable laws and regulations and express assurance on those items tested, disclosing any material instances of non-compliance and fraud. We carried out the procedures hereunder to ensure that the audit objectives are met; a) Reviewed the TOR and oriented the audit team towards achieving the audit objectives within the agreed time frame. b) Prepared the audit strategy document including tailored audit programmes and check lists to meet audit objectives. c) Reviewed the background information of the operations of ERF funded projects including a review of the ERF guidelines, Procurement & disposal guidelines by ACF. d) Conducted meetings with ACF management. e) Verified donor funding and expenditure as specified hereunder but not limited to; i. Checked and / or verified the vouchers and other relevant documents supporting both income and expenditure. ii. Performed walk through tests to confirm the correctness of the descriptions and sources of the documents. iii. Evaluated the evidence i.e vouchers and receipts to determine their reliability and authenticity. iv. Requested for all disbursements listed in the financial report submitted by ACF. v. Requested for direct payments processed by OCHA/UNDP at the request of ACF. vi. Verified the mathematical accuracy to ensure that the expenditures described in the supporting documentation, the financial reports, and the certified expenditure statement were reconciled to the expenditures, as per initial disbursed grant. vii. Reviewed cost charged to the Project and checked that such costs are in accordance with the projects plans and budgets, and that they are reasonable. viii. Assessed whether claimed costs met the eligibility criteria set out in the Emergency Response Fund for Uganda Management Guidelines and the Project Agreement. ix. Assessed whether there are any expenditure variances by pegging the approved budget against the actual expenditure and obtaining explanations on a budget line basis.
x. xi.
Reconciled income from UN-OCHA comparing ACF data with UN-OCHA. Reviewed ACFs compliance with the terms of the Project Agreement including variances, maintenance of project records, procurements and disposals, management of unspent funds etc.
The audit was guided by a risk based approach to meet the above objectives and the audit methodolology principally comprised of the hereunder steps; 5.1 Accounting and Internal Control System a) Requested for the Agencys financial manual that guided ACF in managing project reciepts, expenditure including addenda thereto. b) Reviewed expenditures made by ACF and assessed whether they were in accordance with project agreement, budgets, ERF Guidelines and MOU. c) Reviewed ACFs accounting records and assessed their adequacy for maintaining accurate and complete records of receipts and disbursements of cash, and for supporting the preparation of the mid-term implementation financial report. d) Reviewed the records of requests for direct payments to ensure that they were signed by authorised ACF officials. e) Asked and verified the accounting system used, control and security of equipment and data. f) Asked for the general administration controls over travel activities, vehicles, office premises, office communications and records maintenance. g) Asked & verified the record of approved mileage rates while delivering project equipment. h) Documented findings, observations and recommendations 5.2 Project Progress a) Asked for project work plans & financial reports for review, and assesment of their consistency with the Project agreement, Memorandum of Undestanding and ERF Guidelines. b) Requested for project reports prepared by ACF and assessed them for compliance with the MOU and ERF guidelines and whether ACF met its responsibilities for monitoring as described in the project agreement. c) Reviewed whether the decisions and/or recommendations of the project activities had been followed through by ACF. d) Reviewed the pace of project progress. e) Documented findings, observations and recommendations 5.3 Donor funding and Expenditure a) Reconciled donations from UN-OCHA and other partners/donors in comparison with the data as registered by UN-OCHA. b) Tested grant income on a 100% basis, including seeking for direct confirmations from UNOCHA. c) Requested for a list of signatories who athourize and approve project expenditure. d) Established whether expenditure allocation is in line with the approved budget and obtained explanations for variances. e) Asked whether written donor approval was obtained where actual expense was significantly higher than the budget.
f) Obtained details of the projects financial transactions and verified the same against support documents to ensure that they are adequately supported, stamped PAID, authorized and correctly allocated. g) Evaluated evidence presented to us for expenditure incurred and determined reliability and authenticity of such evidence, including obtaining explanations satisfactory to us. h) Compared actual expenditure to approved budget for each budget line, analyzed variances and sought explanation for such variances. i) Performed walk through tests to confirm the correctness of the descriptions and authenticity of documents. j) Reviewed expenditure charged to the Project and checked that such expenditures were in accordance with the work plan and budget, and that they were reasonable. k) Reviewed transfers of funds to third parties to ensure that the same were bonafide transactions for the Project. l) Reviewed ACFs accounting records to ensure that they are adequate for the preparation of the financial reports. m) Documented findings, observations and recommendations 5.4 Human Resources a) Asked whether there was recruitment of personnel to test whether they met the highest standards of qualification, technical and professional competence necessary for the achievement of the project objectives as stated in Article IV of the project agreement. 5.5 Procurement & disposal a) Asked for procurement guidelines as applicable, delegations of authorities, procurement thresholds, call for bids and proposals, evaluation of bids and proposals and approval/signature of contracts and purchase orders. b) Reviewed the process for procurement/contracting activities and assessed wh ether it was transparent and competitive. c) Tested whether the receiving and inspection procedures conformed with the agreed specifications of equipment. d) Requested for the procedures established to mitigate the risk of purchasing equipment that do not meet specifications or is later proven to be defective. e) Tested whether there was management and control over the variation orders. f) Reviewed the use, control and disposal of non-expendable equipment and assessed whether it was in compliance with terms as reflected in the MOU, and also whether the equipment procured met the identified needs and whether its use was in line with intended purposes. g) Documented findings, observations and recommendations 5.6 Cash & Bank a) Requested for a list of project bank accounts, signatories to those accounts and their specimen signatures. b) Asked for cashbook(s) and bank statements to reconcile them with project receipts and expenditure. c) Asked & verified whether cash funds held by the project were safely guarded. d) Tested whether project bank reconciliation statements were prepared, reviewed and approved by responsible officials for the period under review. e) Documented findings, observations and recommendations
5.7 Stores Management a) Asked & reviewed the stores management system used. b) Asked & verified the existance of stores to safe guard equipment purchased. c) Asked & verified the updated record of equipment stored. d) Tested & verified whether material transfer notes were used while dispatching equipment from the stores. e) Documented findings, observations and recommendations 5.8 Compliance with the Project Agreement and Assets management a) Reviewed the Project Agreement and checked compliance with its provisions, including requirements on variances in expenditure, maintenance of project records, procurements and disposals, management of unspent funds, bank accounts and staffing. b) Asked for the assets register to verify equipment purchased for use by the project, the procedures for receipt, storage and disposal. 5.9 Evidence of the physical existence of the project We sought evidence of Project implementation by reviewing project records and other documentation, including the following; a) Field visits to verify whether project activities were undertaken. b) Project visibility in areas of operation Checked activities carried out under the project that fostered project identity. c) Representations from existing staff who facilitated the project d) Progress reports.
10
ACTION AGAINST HUNGER ERF-DMA-0468-001 6.0 FUND ACCOUNTABILITY STATEMENT FOR THE SIX MONTHS ENDED 31ST DECEMBER 2010.
US$ Amount as per the approved budget (A) Disbursements recieved from UN-OCHA (B) Add: Bank interest recieved (C) Less: Bank charges on disbursements (D) Total income (E=B+CD) Total Project expenditure claimed in Annex 1 (F) Less: Ineligible expenditure (G) Total eligible expenditure (H=F-G) UN-OCHA contribution (100% of eligible expenditure) (I) Amount due and recievable from UN-OCHA (I=I-E) Represented by: Deficit on Project implementation (Annex 1) Add: Ineligible expenditure Amount due and payable by UN-OCHA See Annex 1 for detailed Fund Accountability Statement 100,000 Nil 100,000 80,000 Nil Nil 100,000
US$
80,000
100,000 (20,000)
20,000 Nil 20,000
The Fund Accountability Statement was approved by ACF on..................................................... and signed by:
The notes on pages 15 form an integral part of the Fund Accountabilty Statement.
11
ACTION AGAINST HUNGER ERF-DMA-0468-001 7.0 STATEMENT OF CASH POSITION AS AT 31ST DECEMBER 2010 USD 80,000 80,000 100,000 100,000 (20,000)
Unspent allocations b/f Add: Net Allocations issued Total Allocations Less: Expenditure Total Expenditure (Deficit)/Surplus
The Statement of Cash Position was approved by ACF on................................ .................... and signed by:
12
ACTION AGAINST HUNGER ERF-DMA-0468-001 8.0 STATEMENT OF ASSETS & EQUIPMENT AS AT 31ST DECEMBER 2010 USD 20,000 20,000 20,000 20,000
Fund Balance Deficit Total Represented by Funds Receivables from OCHA Total
The Statement of Assets & Equipment was approved by ACF on........................................ and signed by:
13
ACTION AGAINST HUNGER ERF-DMA-0468-001 9.0 DETAILED STATEMENT OF EXPENDITURE FOR THE SIX MONTHS ENDED 31ST DECEMBER 2010
Budget (USD)
3,300 17,760 13,370 4,390 21,060 18,500 8,000 8,400 19,710 210 54,820 10,800 2,350 603 850 14,603 1,125 1,000 850 2,975 3,925 937 1,680 6,542 100,000
Description Staff & other personnel costs International Staff Local Staff Programm staff Direct Programm support staff Sub-Total Relief items WASH Activity 1 Water Supply WASH Activity 2 Environmental sanitattion WASH Activity 3 Hygiene Promotion WASH Activity 4 Community Capacity Building Other (specify)- Visibility Sub-Total Transport & storage costs Vehicle rental Fuel Freight Generator Moroto Sub-Total Operational Project Cost Communications Office supplies Others (specify) Computer for project Sub-Total Administrative Costs (Max. 7% of Total) Office rent Kampala Office supplies Kampala Generator fuel and maintenance Sub-Total TOTAL EXPENDITURE
Actual (USD)
173 13,797 12,942 856 13,970 18,944 8,517 13,754 16,323 122 57,660 10,632 4,383 892 0 15,907 2,917 2,673 721 6,311 4,000 1,636 516 6,152 100,000
Performance Variance
10.3,127 3,963 428 3,534 7,090 (444) (517) (5,354) 3,387 88 (2,840) 168 (2,033) (289) 850 (1,304) (1,792) (1,673) 129 (3,336) (75) (699) 1,164 390 0
% Performance
5% 78% 97% 19% 66% 102% 101% 164% 83% 58% 105% 98% 187% 148% 0% 109% 259% 267% 85% 212% 102% 175% 31% 94% 100%
The Statement of Expenditure was approved by ACF on ... and signed by:
14
ACTION AGAINST HUNGER ERF-DMA-0468-001 10.0 NOTES TO THE FUND ACCOUNTABILITY STATEMENT FOR THE SIX MONTHS ENDED 31ST DECEMBER 2010 Accounting Policies The principal accounting policies adopted by the projects management in the preparation of the Financial Statements are set out below: a. Basis of Accounting These accounts are prepared under the historical cost convention on a modified cash basis. b. Reporting Currency The reporting currency is United States Dollars (USD) at the exchange rate prevailing during the period under audit. c. Income Income represents grants received from the UN-OCHA, and is recognized upon receipt. e. Expenditure Project expenditure is recognized when expenses are paid for project activities.
15
ANNEXES
16
Annex 1. DETAILED FUND ACCOUNTABILITY FOR THE SIX MONTHS ENDED 31ST DECEMBER 2010
Original approved budget
Budget lines
ACF contribution (USD)
ERF contribution (USD)
Total
Actual Project income & expenditure claimed from ERF (USD)
% Performance
Notes
(USD)
(USD)
(%)
INCOME Disbursements Total EXPENDITURE Staff & other personnel costs International Staff Local Staff Programm staff Direct Programm support staff Sub-Total Relief items WASH Activity 1 Water Supply WASH Activity 2 Environmental sanitattion WASH Activity 3 Hygiene Promotion WASH Activity 4 Community Capacity Building Other (specify)- Visibility Sub-Total Transport & storage costs Vehicle rental Fuel Freight 10,800 2,350 603 10,800 2,350 603 10,632 4,383 892 168 (2,033) (289) 98% 187% 148% Compliance finding n o.1 Compliance finding n o.1 18,500 8,000 8,400 19,710 210 54,820 18,500 8,000 8,400 19,710 210 54,820 18,944 8,517 13,754 16,323 122 57,660 (444) (517) (5,354) 3,387 88 (2,840) 102% 101% 164% 83% 58% 105% Compliance finding n o.1 100,000 100,000 100,000 100,000 80,000 80,000 20,000 20,000 80% 80%
3,300 17,760 13,370 4,390 21,060
3,300 17,760 13,370 4,390 21,060
173 13,797 12,942 856 13,970
3,127 3,963 428 3,534 7,090
5% 78% 97% 19% 66%
17
Original approved budget
Budget lines
ACF contribution (USD)
ERF contribution (USD) 850 14,603
Total
Actual Project income & expenditure claimed from ERF (USD) 0 15,907
% Performance
Notes
(USD) 850 14,603
(USD) 850 (1,304)
(%) 0% 109% Compliance finding n o.1 Compliance finding n o.1
Generator Moroto Sub-Total Operational Project Cost Communications Office supplies Others (specify) Computer for project Sub-Total Administrative Cost (Max. 7% of Total) Office rent Kampala Office supplies Kampala Generator fuel and maintenance Sub-Total TOTAL EXPENDITURE Deficit for the period
1,125 1,000 850 2,975
1,125 1,000 850 2,975
2,917 2,673 721 6,311
(1,792) (1,673) 129 (3,336)
259% 267% 85% 212%
3,925 937 1,680 6,542 100,000
3,925 937 1,680 6,542 100,000
4,000 1,636 516 6,152 100,000 20,000
(75) (699) 1,164 390 0
102% 175% 31% 94% 100% Compliance finding n o.1
18
ANNEX 2: MANAGEMENT LETTER
19
SUMMARY OF FINDINGS No. A Heading Financial Audit Findings None N/A N/A N/A Priority Possible Cause Reference No.
Management Control Findings None N/A N/A N/A
C 1
Compliance Findings
Expenses exceeded ten per cent (10%) on six line items of the project budget
High
Compliance
Compliance Finding 1.
20
DETAILED FINDINGS
A: Financial Audit Findings

Therewere no financial audit findings noted during the period.
B: Management Control Finding

Therewere no management Control findings noted during the period.
C. Compliance Findings Finding n: 1 High Description of the finding
Title: Expenses exceeded 10% on six line items of the project budget. Compliance
Artilce VII of the project agreement states that the agency shall be authorised to make variations not exceeding ten per cent (10%) on any one line item of the project budget, provided that the total project budget allocated by OCHA is not exceeded. However, we found out that the underlisted expenses exceeded ten per cent on the line items of the project budget.
Budget line WASH Activity 3 Hygiene Promotion Communications Office supplies Office supplies Kampala Fuel Freight Budget (USD) 8,400 1,125 1,000 937 2,350 603 Actual (USD) 13,754 2,917 2,673 1,636 4,383 892 Variance (5,354) (1,792) (1,673) (699) (2,033) (289) % Performance 164% 259% 267% 175% 187% 148%
Implication Expenses exceeding ten percent on any one line item of the project budget is breach of Article VII of the project agreement and such expenditures may be considered ineligible funding. Recommendation Management should ensure that they adhere to the provisions of the agreement when carrying out project activities. Response from ACF i g M t l B g t F ll w U t l ll w t x j t it i ACF i i l ti g i Ug t x v t % w k w t g t C g i g i g t i l iti l k iti l i g l t i t t t i Response from UN-OHA

21
Annex 3. FIELD REPORT In order to verify the implementation level of the project and activities undertaken during the period under audit, we sampled and visited some of the sites where ACF project activities were carried out for the six months ended 31st December 2010. We randomly visited some of the beneficiaries and our findings are reflected in the table below; Field report on sites visited which were funded by ERF and implemented by ACF for the six months ended 31st December 2010. Beneficiary Project Benefits Challenges Napak Sub-county Bore Hole Construction Rehabilitation WASH Training and Availability of safe and clean water in the area Hand washing behaviour gradually adopted Maintenance costs still high for the community. -Transport constraints for health assistants to sensitize communities about the benefits of good sanitation. - Poverty
Iriiri Health Centre
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ACF Audit Report Reviewed With ACF Response

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UNITED NATIONS DEVELOPMENT PROGRAMME OFFICE FOR COORDINATION OF HUMANITARIAN AFFAIRS

TABLE OF CONTENTS Page 1. LIST OF ACRONYMS................................................................................... .................. 2 2. PROJECT BAC ROUND...............................................................................................................3

3.0 STATEMENT OF PROJECT MANAGEMENTS RESPONSIBILITIES

Approved by the Project management on ..... 2011 and signed by:

......................... ..................... Antoine Esclatine Country Director

....................................... ...... Tom Coogan Administration Coordinator

20,000 Nil 20,000

......................... ..................... Antoine Esclatine Country Director

....................................... ...... Tom Coogan Administration Coordinator

......................... ..................... Antoine Esclatine Country Director

....................................... ...... Tom Coogan Administration Coordinator

......................... ..................... Antoine Esclatine Country Director

....................................... ...... Tom Coogan Administration Coordinator

......................... ..................... Antoine Esclatine Country Director

....................................... ...... Tom Coogan Administration Coordinator

Original approved budget

ACF contribution (USD)

ERF contribution (USD)

Actual Project income & expenditure claimed from ERF (USD)

3,300 17,760 13,370 4,390 21,060

3,300 17,760 13,370 4,390 21,060

173 13,797 12,942 856 13,970

3,127 3,963 428 3,534 7,090

5% 78% 97% 19% 66%

Original approved budget

ACF contribution (USD)

ERF contribution (USD) 850 14,603

(USD) 850 14,603

(USD) 850 (1,304)

(%) 0% 109% Compliance finding n o.1 Compliance finding n o.1

1,125 1,000 850 2,975

1,125 1,000 850 2,975

2,917 2,673 721 6,311

(1,792) (1,673) 129 (3,336)

259% 267% 85% 212%

3,925 937 1,680 6,542 100,000

3,925 937 1,680 6,542 100,000

4,000 1,636 516 6,152 100,000 20,000

(75) (699) 1,164 390 0

102% 175% 31% 94% 100% Compliance finding n o.1

ANNEX 2: MANAGEMENT LETTER

Management Control Findings None N/A N/A N/A

A: Financial Audit Findings

B: Management Control Finding

C. Compliance Findings Finding n: 1 High Description of the finding

Iriiri Health Centre

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