Auditors

1. Presentation of the Beneficiary and its presence in Lebanon:

MdM is an international medical NGO, applying all humanitarian principles in its programs worldwide. In over 30 years of presence, MdM has led many projects in Lebanon. They intended to heal the wounds of the civil war in the years 1980. Later, in 1996, MdM intervened to assist the people of South Beirut and South Lebanon hit by Israel’s operation Grapes of Wrath. In 2001, Médecins du Monde resumed its historic partnership with Amel Association in southern Lebanon, opening its first mental health program. In 2005 and 2006, MdM ran a program to provide healthcare and psychosocial support to prisoners in Roumieh. During and after the War of July with Israel in 2006, the program was reoriented towards war-affected displaced populations, with a focus on mental health. Also, since the beginning of its operations, MdM has always had a strong mother and child program.

Since 2012, MdM has been actively engaged in reducing the impact of the Syrian crisis on the mental and physical health of the Syrian refugees and vulnerable host population, providing access to quality healthcare and medication, including reproductive health and mental health services. In November 2021, AFD granted a 4.3m€ subvention to a consortium of NGOs lead by MdM to implement the project: “Improving Mental Health and Wellbeing of all women, men, boys, girls and non-gender conforming individuals living in Lebanon”. The consortium project is implemented from November 2021 to April 2024 with 4 partners: the NGOs Skoun, Abaad and Embrace as co-applicants, and the National Mental Health Program as co-implementer.

2. Objective of the project:

MdM, Skoun, Abaad, Embrace and the National Mental Health Program (NMHP), aim to improve the opportunities for women, men, boys, girls and gender non-compliant individuals in Lebanon to enjoy the best possible mental health and wellbeing. The consortium aims to reach its objective through supporting community-based Mental Health and Psycho-Social Support (MHPSS) and Substance Uses (SU) system offering appropriate, quality and gender inclusive services to all people living in Lebanon, particularly the most vulnerable groups and people at risk, while tackling gender barriers in service access and gender biases in service provision. The Project will be implemented in Beirut, Bekaa (Baalbek) and North of Lebanon 

Activities:

The specific activities of the project target the different levels of the social ecological model with activities designed and aimed at the individual, interpersonal, organizational and community levels. Specifically, the consortium aims to operate three Community Mental Health and Substance Use Centers (CMH-SUC) in Lebanon, integrate MHPSS within six Primary Health Care Centers that are part of the Ministry of Public Health network, operate the National Lifeline for Suicide Prevention and Emotional support, implement outreach activities, as well as conduct a series of trainings, capacity building and awareness sessions to targeted groups of the society to fight the stigma against mental health and gender biases and promote usage of services, while tackling gender barriers in accessing mental health and substance use services.

1. Counterparts and coordination mechanisms:

A consortium led by Médecins du Monde France will be the beneficiary of a € 4.325 Million grant to enable the operational implementation of the NMHP's Mental Health and Psychosocial Support Strategy. This consortium was selected following an APCC. The bid selection committee included the NMHP Director and his representatives.

In addition to the 1 consortium co-applicant, 3 other organizations have been identified and proposed by the consortium to collaborate on the project: Skoun, Abaad and Embrace. The budget will be executed by MdM.

To ensure consistent implementation of the project and technical adequacy of activities, and to have strategic oversight of the intervention as a whole, three coordination mechanisms will be needed:

1. High-level Steering Committee: composed of representatives of AFD (Beirut Agency), MoPH / representatives of the National Program for Mental Health, WHO and MdM (as the lead agency of the consortium), it will meet every six months. It is the advisory body to ensure consistency in project implementation and progress in line with the National Strategy on Mental Health and Substance Abuse, providing support to the modeling process.

2. Coordinating Committee: composed of representatives of the consortium members, meeting every three months to review the implementation and progress of the project, with strategic, operational and financial decision-making attributions. This committee will focus on ensuring the strategic coherence of project components and adjustment initiatives, as appropriate.

3. Technical Advisory Committee: composed of technical advisers from all partner organizations who will meet on a regular basis and according to the needs arising from the development of the program. This committee will review and share experiences on the technical components of the program, as well as a consultancy capacity in case of difficulty related to the technical aspects of the implementation of the project.

2. Audit Scope

The audit will cover the entire scope of the program agreement signed with AFD, namely:

Grant amount: 4.325.000,00 EUR (in addition to possible top up)

Period from 01/11/2021 to 30/04/2024 (in addition to possible time extension)

1 country: Lebanon

The purpose of the audit is to ensure that the resources made available to MdM, Skoun, Abaad, Embrace and National Mental Health Program have been used for the purposes for which they were granted.

More precisely, it will be necessary to verify that the expenses reported in the financial reports submitted to AFD are real ("Occurrence"), precise ("Accuracy"), consistent with the accounting records of MdM and its partners, and eligible. Eligibility implies that the funds made available by the grant have been used in accordance with the provisions of the financing agreement.

The audit will have to cover a sample greater than 35% of the total amount of the project expenditure and each item of the budget will have to be verified for a significant amount. To do this, the audit will have to rely on a precise and documented control procedure allowing the establishment of factual observations.

Based on the supporting documents, provided by MdM, the auditor will perform the verifications listed below: 

1. 1. Verify compliance of the purchase files launched during the execution of the contract comparing the dispositions (i) of the Financing Agreement signed between MdM and AFD, (ii) instructions for procurement, (iii) procurement plan validated by AFD, (iv) manual of procedures and (v) appropriate rules applicable to MdM.

The auditor will verify in particular:

• The Compliance of the procurement and selection procedures.
• The Relevance of purchase files documents (especially the qualification and evaluation criteria).
• The respect of transparency, openness and fairness of the quotations (advertisement, deadline).
• The market’s provision (presence of the signed statement of integrity, without any modifications; guarantees and insurances required, payment methods).
• The correct application of AFD’s procedures used for the Project. The availability of the equipment procured with project funds (vehicles, IT equipment, etc.) and the correct allocation in accordance with the project arrangements (availability of equipment in the services and structures for which it was intended).

1. 2. Verify that the due diligence and commitments made to AFD regarding (i) legal origin of the funds and absence of act of corruption, fraud, anticompetitive practices, and (ii) Social and Environmental Responsibility have been initiated as per articles 6.9 and 6.10 of chapter 6 of the Convention.

• 3. Verify the project’s accounts including expenses and supporting documents as stated in the Financing Agreement , particularly:
• The correct use of funds in accordance with the project’s objectives.
• The integrity of the funds raised by MdM and their use.
• The reality of supplies, equipment, works and services acquired, in quantity and quality.
• The effective payment of the providers for the services rendered.

3. Audit timing and location

The audit will take place ideally in a period of 3 months after the end of the fiscal year (including any no cost extension if any).

Audit firms will make a proposal for intervention in collaboration with MdM. Below is an estimate concerning the intervention chronogram for the fiscal year audit.

1 - Sending the entire list of the accounting expenses to the auditor.

2 - The auditor sends the list of documents that he wants to verify to the beneficiary.

3 - Audit of accounting documents in MdM Beirut Office.

4 - The auditor sends his provisional report to the beneficiary.

5 - The beneficiary returns this provisional report with questions and comments to the auditor.

6 - The auditor sends his final report to the beneficiary

Note that MdM needs to submit the audit report within 4 months of the end of the fiscal year for each year to AFD.

Note also that the final report might be postponed according to the agreements with the donors.

4. Deliverables of the audit

At the end of the mission for each year, the auditor must submit two documents:

- The audit report / summary report, which will contain the auditor's professional opinion on the financial statements of the project (balance sheet and statement of expenditures and resources) and on the compliance of project implementation under the terms of the Financing; compliance of tenders and execution of the markets will be integrated to the audit report;

- The report on internal control (letter to Management) reporting on all weaknesses in the system, assessing the risks associated with these deficiencies and proposing relevant and practical recommendations with a timeline for implementation;

The audit report shall describe the purpose, agreed procedures and factual findings of the engagement in sufficient detail to enable the recipient and the Contracting Authority to understand the nature and scope of the procedures performed by the auditor and factual observations provided by the auditor.

MdM will have a right to response to any findings that would have not been solved during the audit process, or recommendation issued by the auditors; any response will be directly included into the audit report.

The audit reports duly approved by the project must be sent in six (06) copies to the agent designated by AFD 3 months after the end of each fiscal year and end of project.

In the event that MdM should request it, the audit firm will meet the donor, AFD, and MdM, to discuss the project financial statements and about commitments that may not have been respected.

5. Internal control and verification of the reliability of the financial management system:

The auditor will have to decide on the reliability and transparency of the financial management system. In particular, it will ensure that this financial management system satisfactorily explains the use of the funds transferred by MdM exclusively for the purposes for which they were provided for the sake of transparency and efficiency.

6. Standards and ethics

The auditor executes this mandate:

• in accordance with the IFAC International Standards on Auditing (ISA);
• in accordance with International Standard on Related Services ("ISRS") 4400 Commitments to Perform Agreements on Financial Information, issued by IFAC;
• in accordance with the Code of Ethics for Professional Accountants, developed and published by IFAC's International Ethics Standards Board for Accountants (IESBA). This Code sets out fundamental ethical principles for auditors dealing with integrity, objectivity, independence, professional competence, duty of care and diligence, confidentiality, professional conduct and technical standards;
• the Contracting Authority requires the auditor to be independent of the recipient and to comply with the independence requirements of the IFAC Code of Ethics for Professional Accountants.

MdM will make available to the auditor the following documents:

• Financial reports and accountings records Narrative reports
• AFD Field Procedures and Procurement guideline
• Contractual documentation and financing agreement CLB 1143 01 E
• Consortium Agreement between AFD and MdM
• Partnership Agreements between MdM and Embrace, Abaad, Skoun and the National Mental Health Program.
• Any documentation related to the test of expenses:
  • Finance dossier (invoices, proof of payment…)
  • Procurement dossier (tenders and any relevant competitive dossier)
  • HR supporting documentation (contract and payslips)
• Its financial, logistics and human resources procedures that would support auditors to carry over their controls of compliance over procedures.
• Any other relevant documentation that would help auditors to fulfil their tests.

In addition, the auditor will have access to all legal documentation, correspondence and any other program related information that may be deemed necessary.