upon Procedures regarding Financial Information as promulgated by the International Federation of
Accountants (IFAC). the auditor is expected:
• To carry out the agreed-upon procedures listed in the Section 3 of this TOR – Scope and
approach of the audit and agreed-upon procedures engagement
• To issue report on factual findings that will support IFAD’s conclusions on the eligibility of the
reported expenditure
The auditor shall comply with the the IFAC Code of Ethics for Professional Accountants, developed and
issued by IFAC’s International Ethics Standards Board for Accountants (IESBA), which establishes
fundamental ethical principles for auditors with regard to integrity, objectivity, independence, professional
competence and due care, confidentiality, professional behavior and technical standards.
3. Scope of the audit and list of agreed-upon procedures
3.1. Grant agreement and Statement of Expenditure (SoE) covered by this TOR.
The grant agreement and the Statement of Expenditure (SoE) subject to the audit and agreed-upon
procedures engagement are indicated in the section 1 of this TOR – background.
3.2. List of agreed-upon procedures covered by this TOR.
The following checks must be performed by the auditor in relation to the eligibility criteria applicable to
the grant agreement. Therefore the auditor is required to gain appropriate understanding of such
requirements in order to carry out only the relevant checks and properly apply the relevant eligibility
requirements.
a) The Statement of Expenditure (SoE) for the reporting period as submitted to IFAD comprises the
project information (name of the recipient, grant number, currency of the grant agreement, name
of the project and reporting period) as well as whether the presentation of the expenditures is per
expenditure category and/or project component as set out in the Schedule 2 of the grant
agreement.
b) The total of the expenditure transaction lists for the reporting period agrees with the total
cumulative expenditures for the same period as described in the SoE submitted to IFAD.
c) The reported expenditure meet with the the project eligibility criteria as described in the Schedule
4 of the grant agreement and other eligibility requirements including but not limited to the correct
exchange rates are used where applicable; duties, taxes and charges included in the financial
report cannot be recovered by the Recipient, and expenditure specifically considered ineligible by
the Schedule 4 of the grant agreement is not included in the SoE.
d) The expenditure is recorded in the accounting system of the Recipient or of the Sub-Recipients
(Third Parties with Subsidiary Agreements such as Implementing Partners, sub-recipients, service
providers, etc.) in accordance with the applicable accounting standards and the Recipient’s usual
cost accounting practices.
e) The expenditure is backed up by sufficient and effective supporting documentation listed at
www.ifad.org/grantforms
, which shall be constantly available and stored in accordance with
paragraph 3.11 of the Schedule 3 of the Grant Agreement.
f) Select a sample of a maximum of 40 transactions from the Recipient’s expenditure transaction
listing. This sample shall represent up to 20% of reported expenditure (Sampled transactions will
be sorted by amounts and added up starting with the lowest amount. The transaction that brings