Professional Documents
Culture Documents
April, 2011
Financial Management Group, NRHM
The aim of this training module on Audit Arrangements is to help the finance and accounts staff to develop an understanding of the following: Various types of audits to be conducted at the state/ district level and their purpose Process of selection and appointment of the auditors, scope of work for auditors and essentials of an audit report Timelines for conducting the audit and submission of the audit reports Analysis of the audit report and necessary follow up action to be taken
AUDIT
What is Audit ?
Objective of Auditing
To assess and provide an opinion on whether the Financial Statements present a True and Fair view of the financial position (Balance Sheet); and the financial performance (Income and Expenditure account) during the period To test whether requisite internal controls are in place, commensurate to the size and volume of operations of the entity
Scope of Work
Although Scope of Work shall basically depend on type of audit and the audit ToRs and is governed by the following: Examination of books of accounts and financial records Verification of assets and liabilities Assessment of internal/ accounting controls Examining financial Statements for arithmetical accuracy, ensuring compliance with applicable accounting standards / guidelines and policies / disclosure requirements Preparation of audit observations and report for discussions with client / management Follow up on the compliance of the prior audit observations However, Primary responsibility of maintaining adequate accounting records lies with the management of the entity Audit involves judgment e.g. in deciding the extent of sample checking in order to arrive at a true and fair view of the financial statements The primary objective is not to detect fraud
Financial Management Group, NRHM
Types of Audit
Statutory Who does the audit? A qualified chartered accountant (C&AG empanelled C.A. Firm) Management i.e. SHS/ DHS Internal/ Concurrent Internal audit team within the organization or an external auditor/ consultant Management i.e. SHS/ DHS (under NRHM) CAG Office of C&AG
Government Arm
Auditors scope is generally Decided by management defined by statute including (Detailed guidelines contents of report, etc. available under NRHM) However sample size, coverage of units, etc. may be agreed at ToR stage.
Reporting
Mission Director of To the Management the State i.e. State / District Health Society
Mandatory or Compulsory by law Voluntary in nature not but mandatory in larger organizations. (Mandatory under NRHM, as per GoI instructions)
Compulsory in organizations where accounts are under the control of union or state Govt.
STATUTORY AUDIT
Key Objectives
The primary objective of 'Statutory Audit is to ensure that the financial statements i.e. the Balance Sheet, Income & Expenditure Account and Receipt & Payment Account, give a true & fair view and are free from any material misstatements Statutory Audit of the financial statements should provide reasonable assurance that the accounts have been prepared in accordance with the Generally Accepted Accounting Principles; & are free of any material misstatements, errors and discrepancies In context of RHM, Statutory Audit also aims at ensuring that: The respective program expenditures are eligible for financing under the relevant grant/ credit agreements (under programs supported by development partners) Funds have been utilized for the purposes for which they were provided
By 31st July
10
By
30th
June
9
By 7th Mar Completion of SHS audit Date for opening technical bids
3
By 15th Mar
8
By 15th June
Completion of DHS audit By 31st May Completion & finalization of DHS accounts
6
By 31st Mar
Last date of submission of bids not less than 3 weeks and more than 5 weeks from date of publication of Advertisement
Financial Bid opening date not later than 3 weeks after the technical evaluations
Technical Evaluation
Contents of the Technical Proposal Letter of Transmittal Details of the firm along with Details of Partners Details of Qualified Staff & Semi qualified Staff Details of Team Composition Description of Approach, Methodology and Work Plan for SHS and DHS audit Relevant Experience Comments and Suggestions on the ToRs Eligibility Criteria of firms Empanelled with C&AG Firm or any partners of the firm should not be black listed by any PSU/ Govt or any other organization in respect of any assignment / behavior
2. 3. 4.
10
5.
2.
10
Rs 25 to 50 Lakhs= 5 Above 50 Lakhs = 10 15 plus 4 to 8 in social sector=5 15 plus above 8 in social sector= 10
3.
No. of assignments: Experience of Commercial / 10 Statutory Audit in last 3 years Specific experience of the firm relevant to the assignment Experience of audit in relation to Social sector of the state (excluding audit of Charitable Institutions)
10
4.
Adequacy of the proposed methodology and work 4 plan , Technical Approach & Methodology work plan
10
Key Professional Staff Qualifications & Competence for the assignment TOTAL MARKS
50 100
* For E States, the Lead Firm or Bidding Firm may have headquarters in any orth Eastern States/ West Bengal. For UTs, the Lead Firm or Bidding Firm may have headquarters in the adjacent States (sharing boundary with the concerned UT). Firms having proper Head Office / Branch Office in the State for not less than three years as per ICAI Certificate as on 1.1.2011 only will be considered under this category. The State should get verified the existence and its effectiveness in the State for at least last three years with proper evidences.
Financial Management Group, NRHM
Team Composition
For Team Composition & Number of Teams, the following guidelines are to be considered by a firm; The team must be headed by a qualified Chartered Accountant with one semi-qualified C.A. (C.A. Inter) and two support staff (Junior Auditor). More than one team needs to be constituted due to a large number of districts and implementing entities below a district, a minimum sample coverage and time bound completion schedule. Each team should not have responsibility for audit of more than (6) to (8) districts in a State. The firm shall give an undertaking that the team members are proficient in the States official language (both oral and written). A record of the team should be maintained at the facility visited and a certificate of their attendance giving their name, designation and date of visit etc. from the head of that facility should be collected by the team.
Team Leader Individual District Team Lead Support to District/ State Team Lead
1 1
Team Structure
Firms should clearly bring out the number of teams it plans to deploy for the audit keeping in view the scope of work, coverage and Guidelines for submitting the proposal. Structure of each team should be indicated as per format below:
ame of CA
Qualification
umber of Districts (including the blocks as in point 8(f) of Section II of RFP) proposed to be covered.
FI A CIAL EVALUATIO
Financial Evaluation
Financial Proposals of the firms which have not qualified on technical parameters shall be returned unopened after the completion of selection process. The financial evaluation will be done on 70:30 weightage to technical and financial proposal. Audit Fee submitted in the Financial Proposal to be exclusive of TA/ DA and taxes as applicable (Appended as Annexure II) Financial Proposal submitted by the firm should be valid for 6 months from the date of submission of the proposal by the firm. Taxes, as applicable shall be paid by the SHS separately on submission of final bill by the audit firm. Single audit fee to be quoted in case of Joint Venture/ Associations Travel Cost for visit to DHS and Block level peripheries shall be reimbursed by the SHS on actual bills submitted by the firm Lodging and Boarding facilities shall be provided by the SHS/ DHS. If the audit firm has its HQs/ branch office in the State Capital itself, no lodging, boarding and travel cost shall be payable to the audit firm
AUDIT REPORT
Audit Opinion (As per the format prescribed in guidelines) Consolidated audit report and individual reports on all programmes Percentage of coverage of districts and blocks by auditor mentioned in report Completed checklist attached Audit Checklist (Appended as Annexure VII) Management letter checklist (As per the format prescribed in guidelines)
2. 3. 4. 5.
6.
Following completed Financial Statements in the latest approved format Audited Balance Sheet Income and Expenditure Receipts & Payment
7.
EMPHASIS SHOULD ALSO BE LAID O OBSERVATIO S WHICH HIGHLIGHT SYSTEMIC WEAK ESSES A D I VOLVE HUGE AMOU TS
RESPO SIBILITIES
What are the checks being As per the information ADEQUATE exercised while preparing provided to us the checks FMRs? implied were: Cash & Bank Balances, advance position, PIP size, actual expenditure, physical verification etc Does the project follow the Joint signatory system of single signatory or joint signatories? Who are the signatories to the bank account (s)? INADEQUATE Designation of signatories at state and district level could be mentioned
2.
In the General Ledger, are the General Ledger is not being ledger accounts (at a minimum) as per prepared at state and district the activity heads in the Financial level. Reporting Formats? If not how are financial reports compiled? Are funds transferred by State Health Yes Society to District Societies or directly to Bank accounts in the name of CMHO or DMO? What is the average frequency of fund The funds transferred to transfer in a year? peripheries is as per the budget availability.
2.
3.
5.
How many bank accounts are being At state level: 2 bank accounts maintained and are Bank of RCH, NRHM and reconciliations carried out on a Immunization. monthly basis?
Financial Management Group, NRHM
Has the auditor(s) been appointed for Yes auditors had been State and District Societies for the year appointed through open tender 2006-07? If yes, what was the process system. of selection of auditors? Were they from the shortlist circulated by FMG?
7.
Has a single audit firm been appointed or have districts been divided amongst firms? Is there a concept of lead auditor to quality assure the audit?
Yes single firm appointed for all districts. Lead auditor has also been appointed.
8.
What are the fee rates, the coverage Fee rates are as prescribed by and the time period for which auditors state. Few blocks are also have been contracted? visited during the audit.
Financial Management Group, NRHM
Answer
Question Auditor's Reply In the General Ledger, are the ledger accounts (at a minimum) as per the activity heads in the Financial Reporting Formats? If not how are General Ledger is not being prepared at state and district financial reports compiled? level Are funds transferred by State Health Society to District Societies or directly to Bank accounts in the same of CMHO or DMO? Remarks Inadequate Since the auditor has commented that general ledger is not maintained by the state & district so he should have provided information on how financial reports are compiled. Inadequate Response of the auditor does not provide information as to which bank account the money is transferred (CMO or DHS) Inadequate Some indication on the frequency of fund transfer under different pools could have been provided.
Yes
The funds transferred to peripheries is as per the budget What is the average frequency of fund transfer in a year? availability UCs were the backbone of booking expenditures at State level, District level & Block level. Hence most of the What is the basis of recording expenditure at State expenditures were booked on the basis of UCs. As per the and District level i.e. is it based on actual expenditure explanations given no transfers except transfers relating to reported by Districts/ sub district units or are transfers VHSC and untied funds were recorded as expenditures recorded as expenditures? How many bank accounts are being maintained and are Bank reconciliations carried out on a monthly basis? Has the auditor(s) been appointed for State and District Societies for the year 2006-07.If yes/no, what was the process of selection of auditors? Were they from the shortlist circulated by FMG? Has a single audit firm been appointed or have districts been divided amongst firms? Is there a concept of lead auditor to quality assure the audit?
Adequate Inadequate No. of bank accounts is not clear. No reply on the monthly preparation of BRS is provided
Yes single firm appointed for all districts. Lead auditor has also been appointed. Contradictory answers INADEQUATE Auditor needs to quantify the fee being given. Also "few" doesnt explain the coverage. The auditor should have mentioned the number of blocks/ implementing units visited along with the frequency of visit during the year. No response has been provided on the time period of auditors contract.
Fee rates are as prescribed by state. Few blocks are also What are the fee rates, the coverage and the time period visited during the audit. for which auditors have been contracted?
2.
3.
6.
7.
9.
Expenditure on hoardings amounting to Rs 21 lakhs were made from the SHS, but no supporting document except the bills of the supplier were made available to the auditor. There was a case of unauthorized purchase of laptop amounting to Rs 80000.
10.
Answer
S. o 1 Obse rvations On the verification of FMRs prepared at districts, it was observed that cheques reversed and refunds received from CHCs/ PHCs have been shown in income account instead of reducing from the relevant advance/ expenditure head as the case may be. Cate gory Indicative / Possible Impact/ Re marks
RTGS tranfer from the SHS amounting to RS 2 lakhs could not be traced and hence is pending settlement. Confirmation of balances have not been obtained from agencies against whom advances are lying in the books of the SHS.
Basically an incorrect accounting treatment, can be rectified This is critical as it has direct impact on fund availability. Immediately action needs to be taken to trace the same and settle. Banker needs to be approached It may be due to lack of system to obtain external confirmations on outstanding balances. However it may have serious impact in case of any irregular advances given. Basically, accounting entry is pending, not a very serious mistake. However will impact the bank and debtor's balances. System should be instituted for passing reversal entries on a timely basis Lack of adequate maintenance of records may lead to misappropriation of funds / misutilization of drugs and equipments etc. Clarification needs to be sought on quantum of procurement - may be disallowed by DPs
No records for purchases of equipments, drugs, etc made by hospitals / CHCs were made available for audit. R Funds sanctioned for the purpose of tele-medicine have been utilized to purchase computers and no supporting documents for reallocation were made available. Out of the 4 tenders received and accepted for purchase of computers, 1 tender did not have a sales tax registration document R/Y Programme management expenses have exceeded the limit of 6 % as prescribed by GoI.
Unauthorized Expenditure. Needs to be regularized. In case the contract has been awarded to a registered supplier, it might not lead to serious implications in this case. However, as a practice, tender should not be accepted from a non registered supplier. Violation of guidelines- appropriate action needs to be taken considering the extent of violation Authorirization of expenditure and complaince with procedures in procurement of supplier, need to be checked while deciding authenticity of the payment. Additonal supporting documents can be requested like photographs of hoardings etc.
R/Y
Expenditure on hoardings amounting to Rs 21 lakhs were made from the SHS, but no supporting document except the bills of the supplier were made available to the auditor.
Self Assessment
Please tick mark ( ) the correct answers. A question can have more than one correct answer. 1. Objective of Audit includes which of the following: a.To assess and provide an opinion on whether the Financial Statements present True and Fair value b.To assess whether the requisite internal controls are in place c. Both a and b 2. Is the CAG audit mandatory to be conducted? a.Yes b. No c. Compulsory for organizations where accounts are under the control of union or state Govt. 3. By when should the statutory auditor be appointed? a. 31st March of the year for which the audit is to be conducted b. 30th April of the next year c. 15th March of the year for which the audit is to be conducted
Financial Management Group, NRHM
Self Assessment
4. Statutory Auditor has to perform which of the following activities: a.Furnish an FMR of the last quarter along with audited financial statements b.Certify the Utilization Certificates c.Conduct physical visits to districts and blocks d. All of the above 5. By when should the statutory audit reports be submitted to the MoHFW? a. 30th April of the next year b. 15th July of the next year c. 31st July of the next year d. None of the above 6.The minimum qualifying marks for technical evaluation of statutory audit are: a. 60% b. 65% c. 70% d. None of the above
Self Assessment
7. The audit fee quoted in the financial proposal should be inclusive of TA/ DA and taxes as applicable. a. True b. False 8. Which of the following are parts of the technical proposal? a. Details of Team Components b. Comments and Suggestions on the ToR c. Details of the firm structure d. All of the above
EXURES
Date of establishment of the firm Date since when is H.O. at the existing Station Branch Office 1,2,3 (Particulars of each branch to be given) Phone No: Fax No: Mobile of each Branch Office In-charge:
Mention the date of each branch offices since when existed at the existing place 3 4 Firm Income Tax PAN No. Firm service Tax Registration No. Attach copy of PAN card Attach copy of Registration Financial Management Group, NRHM
5 6 7 8 9 10
Firms Registration No. with ICAI Empanelment No. with C & A G No. of Years of Firm Existence & Date of establishment of Firm Turnover of the Firm in last three years Annual Average Turnover with Break-up of Fee towards Audit, Income Tax matters and others (Specify)
Attach proof of latest empanelment with C&AG for the year under Audit. Attach copy of Partnership Deed Attach balance sheet and P&L Account of the last three years or a C.A. Certificate give Break-up of Audit Fee and Other Fees Received. Provide a Chart
Audit Experience of the Firm: 1. Number of Assignments in Commercial/Statutory Audit Copy of the Offer Letter & the Fee Charged. 2. Number of Assignments in State Social Sector Audits Copy of the Offer Letter & the Fee Charged (Relevant (Other than audit of Charitable Institutions) evidences to be given of the turnover and fee) 3. Experience in the relevant assignment. Details of Partners: Provide following details: Number of Full Time Fellow Partners associated with the firm. Name of each partner, Date of becoming ACA and FCA Date of joining the firm, Membership No., Qualification Experience Whether the partners is engaged full time or part time with the firm. Their Contact Mobile No., email and full Address If applying in Joint venture, then provide similar details for the firms participating in Joint venture. Indicate the Lead Auditor in the Joint Venture. Attested copy of Certificate of ICAI as on 1.1.2011.
11
12 13
Letter jointly signed by all the firms participating in Joint venture whereby they have agreed for the Lead Auditor. Letter jointly signed by all the firms participating in Joint venture whereby they have agreed for the Lead Auditor. Financial Management Group, NRHM
Breakup of the Audit Fee quoted above must be provided as per following format:*
S. NO. 1
2 3 4
Particulars Audit of individual District Health Societies including sample of sub district level implementing units (covering all programs) Give a break-up for each district Audit of State Headquarter of SHS and other state level implementing units Audit of Consolidated Financial Statements of State and District Health Societies. Others, if any TOTAL
Amount (Rs.)
Please provide the details of man days and their costing in the format being provided as per Appendix A given below * To be arrived based on the estimated man days for each category of staff proposed for the assignment. External Audit - Internal Cost Estimate (say Tamil adu) with 30 districts and approx 400 Blocks (All programs) o of days per Total Districts State Other Consolida Total Man Estim Remarks S Descriptio ated . n & 40 % blocks Socie Perip tion/ Man Day Rate Cost ty heral Planning, Days o Units Final (Rs.) (Rs.) Report & in state Discussion etc o Distric Block 30 400 of t CHC/PH District Blocks pers C s - 40 % ons covera ge 1 Partner 1 15 15 For overall Planning & Managemen t Could be the partner Directly 6 to 8 teams 7 to 8 teams
2 Team Leader
10
30
45
10 10
4 4
300 600
640 1280
10 10
15 10
15 15
980 1915
Introduction We have audited the accompanying expenditure statements / financial statements of the RCH Program Phase-II (World Bank Cr. No. 4227-IN) , Routine Immunisation, Pulse Polio Immunisation and Additionalities under NRHM including all the National Disease Control Programmes i.e. RNTCP-I financed under World Bank Credit No. 4228IN , Leprosy, Blindness, IDD, IDSP and NDVCP (World Bank Cr. No. No. 2964-IN) implemented through the ............State Health Society, as of 31st March, 200 . Our responsibility is to express an opinion on these financial statements based on our audit. Scope We conducted our audit in accordance with standards on auditing issued by the Institute of Chartered Accountants of India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. In forming our opinion we have relied upon the audit findings / observations in .(nos.) District Health Society/ .State Health Societys financial statements, which have been audited by other auditors. We believe that our audit provides a reasonable basis for our opinion. Financial Management Group, NRHM
Opinion a. The statements of account dealing with this report includes funds received from World Bank under Reproductive and Child Health Program Phase II (Cr. o. o. 4227-I ) and R TCP-II (Cr. o. 4228-I ). b. We have obtained all the informations and explanations which to the best of our knowledge and belief were necessary for the purpose of our examination. c. In our opinion, proper books of account have been kept by the State Health Society, so far as appears from our examination of the books. d. The statements of account dealt with this report are in agreement with the books of account. e. Financial Statements of the State is the consolidated Financial Statements of the State and District Societies. f. In our opinion and to the best of our information and according to the explanations given to us the said consolidated accounts of the State and District Societies, gives the information in the manner so required and give a true and fair view:1. In the case of the balance sheet, of the State of affairs of the Society as at 31st March,.... 2. In the case of the Income and Expenditure Account of the excess of income over expenditure / deficit of income over expenditure for the year ended on that date. 3. In case of Receipts and Payments Account of the receipts and payments during the year ended on that date.
a. In addition with respect to FMR/SOEs, adequate supporting documentation has been maintained to support claims to the World Bank for reimbursements of expenditures incurred; b. The expenditures so claimed are eligible for financing under the Credit Agreement; and c. Procurement of goods and services has been carried out as per the Procurement manual by Central TB Division and other concerned division of the Govt. of India.
Place: Date: otes :1. In case, a qualified opinion or disclaimer is given by the auditor, the audit report should state in a clear and informative manner all the reasons for such an opinion. 2. Audit Report to be accompanied by: a) Management Letter b) Reconciliation of Expenditure as per FMR/SOEs claims with the actual expenditure as reported in the audited financial statements. 3. Matters which have been underlined needs proper attention of the auditor.
Financial Management Group, NRHM
Liabilities
Assets
Total Loan & Advances Figure A of Sch. Advances-RCH-I Figure A of Sch. Advances-RCH Flexipool
Unspent Grant
IV-A IV-B
Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure
A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch.
RCH-I RCH Flexipool NRHM Additionalites RI Strengthening Project Pulse Polio (PPI) EC SIP TB Programme (As per CTB Division) Malaria Iodine Deficiency Blindness Control IDSP Leprosy Others (Please specify)
Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure
E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch.
I-A I-B I-C I-D I-D I-E I-F I-G I-H I-I I-J I-K I-L
Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Total
A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch. A of Sch.
Advances-RI Strengthening Advances-PPI Advances-NRHM Additionalites Advances-EC SIP Advances-TB Progamme Advances-Malaria Advances-Iodine Deficiency Advances-Blindness Advances-IDSP Advances-Leprosy Advances-Staff Advances-Others (Please specify)
IV-B IV-B IV-C IV-D IV-D IV-D IV-D IV-E IV-E IV-E IV-F IV-G.. V
Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure
E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch. E of Sch.
Figure A of Sch. OTHER CURRE T ASSETS Figure A of Sch. Fixed Assets Reserves Fund A/C II Figure D of Sch. Closing Balances : Figure A of Sch. Cash in Hand Figure B of Sch. Bank Balance Cheques/Draft in Hand 0 0
Figure D of Sch.
Figure A of Sch.
Current Liabilities
III
Figure D of Sch.
VI VI VII Total
0 Place : Date :
Total
Chartered Accountants
Mission Director
STATE HEALTH SOCIETY Income & Expenditure For The Year Ending 31-03-20XX Previous Yr. At 31-03-XX Sch. Ref. I-A I-B I-C I-D I-D I-E I-F I-G I-H I-I I-J I-K I-L Current Yr. At 31-03-XX Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Previous Yr. At 31-03-XX Grant Received RCH-I RCH Flexipool NRHM Additionalites RI Strengthening Project Pulse Polio (PPI) EC SIP TB Programme Malaria Iodine Deficiency Blindness Control IDSP Leprosy Others (Please specify) Interest Earned Income Over Expenditure (Surplus) Expenditure Over Income (Deficit) 0 Total 0 0 Total 0 0 I-A I-B I-C I-D I-D I-E I-F I-G I-H I-I I-J I-K I-L VIII Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure C of Sch. Figure B of Sch. Sch. Ref. Amount in Rupees Current Yr. At 31-03-XX
Expenditure
Income
RCH-I RCH Flexipool NRHM Additionalites RI Strengthening Project Pulse Polio (PPI) EC SIP TB Programme Malaria Iodine Deficiency Blindness Control IDSP Leprosy Others (Please specify)
Mission Director
Cash 3
Bank 4
Sub-Total 5
Grant-in-aid received during the year (including cheque received or to be received from GOI) 6
Other Grants 7
State Contribution
Interest 10
Grand Total 11
Funds utilized/expenses during the year (other than fixed assets) as shown in the Income & Purchase of Expenditue a/c fixed assets 3 4
Cheques/Draft in Hand
Refund of EMD/SD 6
Cash 8
Bank 9
10
Total 11
URBA
I FRASTRUCTURE & HUMA RESOURCES (i) Activity - Contractual Staff & Services State Districts Sub Total
(ii) Activity - Minor civil works State Districts Sub Total 5 TRAI I G State Districts Sub Total 6 PROGRAMME MA AGEME T
State Districts Sub Total Operating Cost on Routine Immunization & Cold Chain Maintenance Sub Total Eligible RHM Additional ties Reporting Heads Operating Costs on Training Contractual Staff Salaries
Signatures Auditors
Accounting and Funds flow a. Are funds transferred by State Health Society to District Societies or directly to Bank accounts in the same of CHMO or DMO? b. Whether the State is transferring the funds to Districts electronically or by physical transfer? c. Whether the fund transfer by State to Districts is being done like RCH flexible pool or does the State carry out activity wise fund transfer to the Districts. d. What is the average frequency of fund transfer in a year? e. To what extent have financial powers been delegated at the state, district and block levels? f. Are they aware of the new draft guidelines circulated by the centre for delegation of administrative /financial powers under NRHM? g. Problems being faced/ outstanding issues on accounting or fund management or banking arrangements Internal Control a. Are Financial Management Indicators being compiled regularly? Copy of latest indicators may be requested How are FM Indicators being used or followed up? Has SPMU been carrying out field checks on basic financial controls (appendix 13 A of Manual) Is there a system of recording, monitoring and settlement of advances at all levels i.e. State, District and sub districts? Is there an ageing of the advance and are there old un-settled advances with staff and others? Are further advances provided without settlement of old advances? What steps are being taken to settle old advances, if any? Does the project follow the system of single signatory or joint signatories? Who are the signatories to the bank account (s)? How many Bank accounts are being maintained and are Bank reconciliations carried out on a monthly basis? Problems being faced/ outstanding issues on internal controls. Report any procurement which has not been carried out as per the procurement manual of the
b. c.
d.
e. f. g. h.
i.
j. k.
Financial Reports: a. Are States familiar with the guidelines for preparation of Revised FMR b. Are the reporting heads in the FMR aligned with the AWP and with the ledger accounts in the General Ledger (to check both at the State and District units) c. Are monthly FMRs submitted by the districts to states on a regular basis? Has the state consolidated the monthly FMRs from the districts for the first quarter of the FY? If so, has it been sent to the Centre and when? (a copy of the last financial report sent may be requested) d. Statement of Fund Position: Whether prepared or not? (Verify the figures from the books of accounts for any quarter as a cross-check measure). e. Do the FMRs go to FMG and programme divisions f. What are the checks being exercised while preparing FMRs? g. Is physical progress being captured in time and consistently? h. Problems being faced/ outstanding issues on financial reporting
Audit: External: a. Is there a TOR for external auditors and is it as per the TOR provided in the FM Manual/ RFP? b. Has the auditor(s) been appointed for State and District Societies for the year 2006-07? c. If yes/no, what was the process of selection of auditors? For 2006-07 were they from the shortlist circulated by FMG? d. Was a tendering processes were followed /will follow to appoint the Auditors? e. Are the bids evaluated for contracting auditors based on technical inputs or are they cost based? f. What are the fee rates, the coverage and the time period for which auditors have been contracted? g. Has a single audit firm been appointed or have districts been divided amongst firms? h. Is there a concept of lead auditor to quality assure the audit? i. Has SPMU received the model audit report sent by FMG? j. Have the audit observations on the audit report for previous FY been shared by the FMG? k. What is the practice for follow up on audit observations? l. Did the auditor visit the districts or districts officials were called at the State along with the records? Internal: m. Does the State have a system of internal/ concurrent audit? n. Does State plan to have internal or concurrent audit on monthly or quarterly basis? o. Are internal audit observations being received regularly and being acted upon? p. Please elaborate on effectiveness and implementation of Concurrent Audit existed in the i) State ii) Districts
State Finance Manager Dated: NOTES: 1. This chart is to be prepared on weekly basis and to be submitted to the Mission Director. 2. A copy of this report is to be submitted to Govt. of India every fortnight after the start of audit. Telefax: 011-23062121/ Mail : fmg.mohfw@gmail.com Financial Management Group, NRHM
Auditors
Financial Management Group, NRHM