NAME OF THE SPONSOR: “Armenian Caritas” Benevolent NGO PROGRAMME TITLE – EA28/2023 – Armenia – RR “Emergency Assistance for People forcefully displaced from Nagorno-Karabakh” DURATION: planned 15.11.2023 – 15.01.2024; extended to 15.03.2024 BUDGET: requested 250,000 EUR; fundraised: 402,940 EUR AUDIT PERIOD: 15.11.2023 – 15.04.2024

 

BACKGROUND

After the large-scale offensive unleashed by Azerbaijan against the people of Artsakh (aka Nagorno-Karabakh – NK) on 19th September, 2023 in blatant violation of the international law and Trilateral Statement of November 9, 2020, around 101,800 people were displaced from NK and found refuge in the Republic of Armenia.

The Government of Armenia has assumed responsibility for assisting displaced people and has implemented a strategy whereby all INGOs and local NGOs operate in coordination with the government through the Ministry of Labour and Social Affairs (MLSA). This strategy is designed to prevent duplications and maximize the impact of initiatives across the board.

Additionally, UN Agencies in Armenia have reactivated the coordination mechanism initially established in 2020 for partners on the ground. This includes the revitalization of working groups focused on areas such as Cash, Protection, Shelter/NFI, Healthcare, and Early Relief. These efforts are aimed at enhancing collaboration and synergy among stakeholders to better address the needs of communities and individuals affected by various challenges.

The needs of registered displaced individuals have been assessed through the online platform of the MLSA. Simultaneously, a comprehensive donor mapping exercise has been conducted to identify all potential resources that could support the government’s response to this humanitarian crisis

Displaced households typically comprise six members, encompassing parents, children of all ages, and sometimes grandparents. As of October 2023, displaced people in Armenia were in urgent need of assistance to access sufficient food, hygiene items, bedding, and warm clothing. Furthermore, the wounded, elderly, and pregnant women required medical support, while many individuals were also in need of psychosocial assistance to address the emotional toll of their displacement.

Armenian Caritas is a part of UN working groups demonstrating its commitment to collaborative efforts in addressing humanitarian needs. Moreover, AC has joined the Armenia Refugee Response Plan (RRP) – October 2023-March 2024 that was launched by UNHCR in October 2023. RRP brings together 60 partners, including 43 national NGOs, and covers relief efforts for a six-month period, until the end of March 2024.

Based on the gaps and needs identified during the UN Working Groups’ meetings, bilateral meetings with MLSA and non-state stakeholders as well as based on conflict-affected families’ expressed needs, at the request and on behalf of Armenian Caritas, Caritas Internationalis launched the EA28/2023 – Armenia – RR “Emergency Assistance for People forcefully displaced from Nagorno-Karabakh” project with support of Caritas Internationalis through the Caritas Confederation Rapid Response fundraising tool.

The project was executed in the provinces of Syunik and Ararat, as well as in the capital city of Yerevan. All activities, including the identification of the most vulnerable communities, target groups, and the allocation of resources to address urgent needs, were conducted in close collaborations with the Government of Armenia through the Ministry of Labour and Social Affairs (MLSA), regional authorities, and local municipalities and in coordination with UN respective WGs .

To streamline the processes, an Umbrella Cooperation Agreement for the coordination of assistance efforts for forcibly displaced people from Nagorno Karabakh was signed with the Ministry of Labour and Social Affairs (MLSA) on December 4, 2023

 

THE PROJECT LOGICAL FRAMEWORK

Goal : Forcefully displaced population from Nagorno Karabakh lives in dignity in the areas of temporary residence in Armenia

Strategic Objective 1 (SO1): 1567 displaced households meet their basic needs

Output 1.1a: Displaced households utilize cash or vouchers to address their priority needs

Two modalities of cash assistance were planned within the project : cash transfers and voucher assistance.

Cash assistance: The RA Government has developed 3 Cash assistance programmes encouraging all stakeholders to joining them. In the framework of the Project AC has joined the State Cash Assistance program adopted by the “Decree of the Government of the Republic of Armenia dated November 9, 2023 No. 1957-Լ on the approval of the Program and Procedures for Providing Social Assistance for Primary Consumer Needs to Forcibly Displaced Individuals from Nagorno Karabakh”.

For this according to the clauses of the Cooperation Agreement between AC and MLSA, a Trilateral Contract was signed among AC, Unified Social Services of MLSA and a Ameriabank on the transfer mechanisms of cash assistance. According to the provisions of the Agreeement, a total number of 1,745 forcibly displaced individuals from Nagorno Karabakh (1245 within the EA Project, 500 – within another Emergency assistance Project) distributed across Ararat, Syunik provinces, and Yerevan received cash assistance of 50,000 AMD (equivalent to approximately 125 Euro) per person to address their essential winterization needs within the Project.

Voucher assistance: Following negotiations with the RA Government and discussions within the UN Cash Working Group, all stakeholders collaborated closely with targeted regional authorities and local municipalities in the provinces, and with the MLSA for Yerevan, regarding the Voucher assistance program. To formalize this collaboration, a Cooperation Agreement on the voucher mechanisms was signed between MLSA and AC on 21.02.2024.

The most vulnerable communities with the biggest numbers of vulnerable displaced people in Syunik and Ararat provinces were identified in coordination with the respective Regional Governments. Data on beneficiaries in the communities of Syunik and Ararat were provided by the local municipalities; in Yerevan – by MLSA USS based on AC criteria.

Voucher assistance of an average amount of 50.000 AMD (equivalent to approximately 125 Euro) was provided to at least to 1276 HHs in Syunik and Ararat provinces and Yerevan.

 

Output 1.1b: Displaced households utilize in-kind items to meet their essential needs for food, living supplies and hygiene items

In parallel with cash assistance Armenian Caritas had planned also in-kind modality to be mainly utilized if Armenian Caritas confirmed that the market in the targeted area was not functioning or inaccessible. This assistance would help vulnerable households displaced from Nagorno-Karabakh meet their basic needs especially during winter months. Based on the general approach for this component negotiations were carried out with the Regional authorities of Syunik and Ararat provinces As an outcome the most vulnerable communities with biggest numbers of vulnerable displaced people were identified. Data of beneficiaries matching AC vulnerability criteria were provided by the local municipalities, needs’ assessment was conducted by the project case managers.

Based on the results of needs assessment, winterization assistance (warm blankets and linen, heaters, household appliances, etc) in an average amount of 78.000 AMD (equivalent to approximately 195 Euro) was provided to around 233 HHs in the targeted communities of Syunik and Ararat provinces. For Yerevan it was decided to shift to voucher assistance given the availability of supermarkets and preferences raised by the displaced people.

 

Output 1.2: Displaced persons receive Post-traumatic psychosocial services (PTPSS)

Within the psychosocial support services case management was provided to 1509 cases that benefited from the voucher and in-kind assistance. Case management was conducted through needs assessment, referrals. Post-traumatic psycho-social support was provided to 46 displaced individuals through groups sessions and self-support groups.

 

OBJECTIVE

The objectives of this audit are to enable the Auditor to express an opinion on whether:

1. the Financial information and reports (accurately present, in all material respects, the actual expenditure incurred and the revenue received by the Project Holder for the period (15.11.2023 – 15.04.2024), in conformity with the applicable Contractual Conditions set with donors (if applicable);
2. the incomes and expenses, assets and liabilities are adequately supported by original documentation and have been properly accounted for; for assets declared as used, the inventory systems show proofs of existence at the date of the agreement; the method applied for the conversion of local and foreign currencies into Euro is consistent with standard accounting practices.
3. adequate and effective internal control system exist.

 

AUDIT SCOPE

The audit work shall cover the adequacy of accounting and financial operations, reporting and management as well as accounting procedures (referring to the national law and the international accounting standards).

A verification of mathematical accuracy is expected, in order to ensure that the expenditures described in the financial statements are reconciled with the supporting documents and with the bank statements.

The period covered by the audit is: 15.11.2023 to 15.04.2024.

The audit will take place in the headquarters of Armenian Caritas in Gyumri and Yerevan office.

 

VERIFICATION PROCESS AND METHODOLOGY

The audit methodology and the audit techniques to be used are those in accordance with international auditing standards and following the ISA 805 norm.

 

REPORTING

The audit report should include the following:

1. Audit method used and the scope of the audit.
2. A statement declaring that all information and documentation needed to complete the audit has been made available as required.
3. Declaration that the required audit standards that have been applied.
4. Distribution and use of the audit report.
5. Formal Opinion.
6. The period covered by the report.
7. Cash flow statement covering the EA implementation period (15.11.2023 – 15.04.2024).
8. Statement of receipts and expenditures covering the EA implementation period (15.11.2023 – 15.04.2024).
9. Income table by source of funding
10. The balance at the end of the implementation period (11.2023 – 15.04.2024).

 

The auditor should submit a letter to the management at the completion of the audit. The management letter should include recommendations to address any weaknesses identified with regards to financial regularity, the internal control system, adherence to contract conditions (if applicable) and the effective use of financial resources.

The audit report shall be written in the Confederation language used for the Emergency Appeal in question.

 

DEADLINES

The auditors shall provide a draft final report of their findings including an opinion, a management letter and a set of conclusions and recommendations not later than 1 week after the end of their field work.

These findings are to be reviewed by the Armenian Caritas Executive Director before the audit report is finalised and submitted.

 

ELIGIBILITY OF THE AUDITOR

By agreeing these ToR the Auditor confirms that he/she meets at least one of the following conditions:

1. The Auditor and/or the firm is a member of a national accounting or auditing body or institution which in turn is member of the International Federation of Accountants (IFAC).
2. The Auditor and/or the firm is a member of a national accounting or auditing body or institution. Although this organisation is not member of the IFAC, the Auditor commits him/herself to undertake this engagement in accordance with the IFAC standards and ethics set out in these ToR.
3. The Auditor and/or the firm is registered as a statutory auditor in the public register of a public oversight body in a third country and this register is subject to principles of public oversight as set out in the legislation of the country concerned (this applies to auditors and audit firms based in a third country).

 

Please submit your proposal (technical and financial) with supporting documentation to l.stepanyan@caritas.am and info@caritas.am by April 21, 2024.

 

Annex 1 to the ToR for the Auditors

Financial information to be prepared by Armenian Caritas before the start of the audit

 

1. List of Incomes and expenses related to EA 28/2023:

• Total income listed by donor
• Table of transfers & currency conversions.
• Expenses/costs presented by month and by budget line

2. Balance sheet at the end of the period (complete as applicable)
3. Consolidated financial report at the end of the period (complete as applicable) against the last budget approved
4. List of project staff working on the EA and percentages dedicated to working on the EA
5. List of equipment bought through the EA
6. A consolidated table of stock procurement, distribution and closing balance
7. Bank accounts statements at the beginning (complete as appropriate) and to the end of the period (complete as appropriate)
8. Monthly bank reconciliations as available
9. Cash flow statement

 

Note: the project holder (national Caritas) is invited to share the draft audit report with the Emergency Response Officer in charge at CI prior to finalization. The Emergency Response Team’s experience of screening of Emergency Appeal financial reports and audit since 2008 has demonstrated that on occasion, there are still a number of errors/discrepancies that need to be worked out before an EA is closed (based on complete and accurate financial and external audit reports). This usually entails additional work on the part of the national Caritas, CI and the auditors, added expense and further delay in closing the EA in question. For these reasons, the ERT believes it would be beneficial to receive the draft audit report and would offer this as an optional service for the national Caritas.