Terms of Reference

Audit (External) for 2025

Purpose of Audit

SIRCS wishes to engage suitable qualified auditing firm to undertake an external review of the financial records of SIRCS 2025 Operations. The auditor will be contracted to:

• Establish whether the SIRCS accounts and reports have been prepared in accordance with Generally Accepted Accounting Principles (GAAP) and give a true and fair view of the financial situation of the SIRCS Operations within the period of 2025.

• Establish whether funds have been used in accordance with the conditions of the relevant financing agreements, with due attention to economy, effectiveness and efficiency, and only for the purposes for which the financing was provided. The relevant financing agreements (Grant Contracts, Financial Summaries, Management Letters, Work plans (with budgets) and any other relevant documents) will be provided upon hire.

• Produce complete and accurate financial statements of SIRCS operational revenues and expenditure during the period under review.

Background

The Solomon Islands Red Cross Society (SIRCS) is a humanitarian organisation that works across Solomon Islands to prevent and alleviate suffering of vulnerable people. SIRCS was established 1983 through the Red Cross Act of 1983 serving as an auxiliary to the Government of Solomon Islands. Under this Act, SIRCS is mandated to providing humanitarian relief to people affected during disasters, situation of conflict and public health emergencies irrespective of ethnicity, race, gender, religion, nor political opinions. The work of SIRCS is guided by the seven fundamental principles and its strength is in the volunteers who serve as first responders to emergencies and supporting community preparedness.

In 2025, SIRCS was not able to conduct an audit on if its finances because of funding constraints. With funding secured, the audit for 2025 is a high priority planned for 3rd Quarter of 2026 to be achieved.

Key requirements

1. The audit will be conducted in accordance with generally accepted auditing standards and will include, as the auditor consider necessary, tests of transactions and of the existence, ownership and valuation of assets and liabilities.

2. The auditor will obtain sufficient and appropriate evidence to enable an understanding of the accounting and internal controls system in order to assess their adequacy as a basis for the preparation of the 2025 narrative and financial reports submitted to SIRCS National board and to establish whether proper accounting records have been maintained.

Approach
The auditor’s work should include sufficient tests to establish whether:

• An adequate budgetary control system is in place to monitor actual expenditure against budget lines on a regular basis and to take effective remedial action as necessary, with adequate segregation of duties in the maintenance and review of accounts and the performance of reconciliations;

• Expenditure of SIRCS funds managed has been disbursed and used in accordance with the Donor Grant Contract and other relevant agreements, with due attention to economy and efficiency, and only for the purposes for which the funds were provided (confirmation of the amount of funds disbursed and outstanding balances should be provided directly to the auditor by SIRCS);

• Goods and services paid by SIRCS funds have been procured in accordance with the relevant financing agreements and with due regard to agreed procurement best practice;

• Inventories and assets registers are complete and accurate and the existence and ownership of assets and stock is regularly verified by physical checks to ensure that they are being used for the intended purposes of the SIRCS operations.

• All necessary supporting documents, records, and accounts have been kept in respect of all expenditure reports.

• Financial reports to SIRCS give a complete and accurate view of financial support to the project from other partners and donors;

• Records of transactions include accurate information regarding any variations in currency exchange rates, where relevant;

• Expenditure of project funds has been approved at the correct level of delegated authority. This includes initial approval to incur expenditure and the payment of claims, invoices, salaries, allowances and any other items of expenditure charged to the project budget.

Final Outputs
1. Audit Report

• The auditor will produce a draft audit report within 10 days of commencement of the audit. The final report will include management comments on the auditor’s findings and recommendations and will be provided 5 days after the draft.

• The auditor will give details of relative size of samples tested.

• The audit report should provide a clear expression of opinion on the management of the SIRCS Operations and on compliance with the funding agreement received. It should also state the basis of the auditor’s opinion.

2. Management Letter

In addition to the audit report, the auditor will prepare a “management letter” by (5 days after draft), in which the auditor will:

• Give comments and observations on the accounting records, systems, and controls that were examined during the course of the audit;

• Identify specific deficiencies and areas of weakness in systems and controls. This will be shared with the SIRCS to communicate areas of development should they address.

• Report on the degree of compliance with the financing agreement and give comments, if any, on the internal and external matters affecting such compliance;

• Communicate matters that have come to auditor’s attention during the audit which might have a significant impact on the implementation of the project; and

• Bring SIRCS to the attention of any other matters that the auditors consider pertinent.

Contract Duration

The Audit is scheduled to commence on the 21st of September 2026 for a period of 15 working days (This includes report submissions). All final report should be finished by the 9th October 2026.

EOI Deadline for submission is 18th September 2026.

Line of Communication

• The auditor will be required to report to the SIRCS National Board Treasurer and the SIRCS Finance Coordinator.