2-SCOPE OF WORK-FY26 Audit.docx

SCOPE OF WORK and PAYMENT SCHEDULE

1. A complete set of financial statements. The financial statements must be presented in country’s local currency.

The complete set of financial statements must include the following at a minimum:

· Opinion on the basic financial statements taken as a whole.

· Statement of financial position (balance sheet) as of June 30, 2026, and July 16, 2026.

· Statement of activities and changes in net assets (statement of revenue and expenses and changes in fund balances) for the year ended June 30, 2026, and July 16, 2026.

· Statement of cash flows for the year ended June 30, 2026, and July 16, 2026.

· All appropriate notes to the financial statements.

· Based upon Ipas’ total expenditure and the expenditure you will be opining on at the country office level, please set the materiality as per the transaction.

2. A management letter that discusses any deficiencies in the internal control structure which you may have observed during your audit test work. In addition, please also include the management letter with the prior year’s comments and the current year’s status of each comment.

Please also note that Ipas Nepal would like to receive comments, if any, categorized by whether they are material weaknesses, significant deficiencies or other areas of concern (the categorization is left to your professional judgment).

3. Based on the knowledge obtained during the performance or your work, please advise us of any related parties as they become known to you and of transactions with related parties. The primary audit objectives with respect to related party transactions are to:

Determine the existence of related parties and identify transactions with them; - Obtain an understanding of related party relationships and transactions sufficient to identify and assess the risk of material misstatement with respect to the country office’s financial statements;

Examine and identify the total amount of related party transactions; and - Determine the adequacy of disclosure.

4. Please notify us of any significant risks of material misstatement of the financial statements, due to fraud or error, identified during the course of your fieldwork and your responses to such risks, if any, as soon as they were identified.

5. Information on instances of noncompliance with laws or regulations at the Ipas office that could give rise to a material misstatement of the Ipas Nepal financial statements.

6. A summary of the corrected and uncorrected misstatements with respect to the financial statements on which you are opining.

7. Please notify us immediately if you become aware of any possible management bias with respect to accounting estimates and the application of accounting principles.

8. Please perform subsequent events procedures from July 1, 2025, to the date upon which your report is approved to be issued final (we will provide such approval after the draft report has been reconciled with the HQ financial information), and advise us of any subsequent events that may require adjustment to, or disclosure in, the field office’s financial statements.

While we understand that your audit will be performed in accordance applicable auditing standards and the regulatory framework governing the operations of International Non-Governmental Organizations in Nepal, based upon our assessment of the significant risks that may cause material misstatement at the consolidated financial statement level, we have identified the following areas in which we would like you to perform additional procedures over.

· Please review in detail all the internal control policies and procedures with respect to the procurement process at Ipas. Select a number of procurement transactions and perform a compliance test for each selected sample.

· Where applicable, please review in detail (select a sample) all significant contract and sub-contract expenses. Your review should include examining original contracts, the procurement process and Ipas oversight/monitoring of contractors/consultants including visit to sub-contract.

· Please disclose all lawsuits against Ipas, regardless of materiality. Please also disclose the status of such lawsuits, if any.

· Should any fraudulent activity be discovered or become known during the audit process, please inform us as soon as possible regardless of the amount.

· Where applicable, please disclose any changes in financial reporting due either as a result of regulatory requirements or business/reporting practices.

· Please review the country office compliance with the local labor law in terms of tax obligation (payroll tax, VAT and any other applicable tax in the country office), ensure all taxes and other dues to the local government are consistently paid on time.

· Review all employees’ benefits (leave, severance and other applicable benefits) and ensure calculation is done correctly and provision for these obligations are properly recorded on Ipas books.

· Review all balance sheet reconciliations and ensure each account is fully reconciled with a supporting schedule as of June 30,2026 and 16th July 2026.

· Review and confirm all wire transfers received by the country office from the Ipas US office for the period of July 1, 2025 through June 30,2026 and 16th July 2026.

· Review employees’ individual files and ensure each employee has a valid employment contract with Ipas in compliance with the country’s local labor law.

· Select sample expenditure and review the supporting documents for the selected sample to ensure compliance

· Review the inventory record and if applicable visit all Ipas warehouses in the country office, verify and provide comments on the adequacy of storage and stock level per warehouse.

· Review the list of Ipas consultants for the country office and determine if Ipas is in compliance with the country office law in term of consultant, ensuring Ipas is in compliance with the maximum length of years they can keep someone as a consultant before ending their contract or hiring them as staff.

· Review with the banks at the country office level to get an independent confirmation of each bank balance as of June 30,2026 and 16th July 2026 along with a complete list of all Ipas bank accounts and full names of bank signatories for each bank account.

We will begin conducting our audit for the year ended June 30,2026 and 16 July,2026. Accordingly, we would like to emphasize the following deadlines:

· Draft audit reports (complete package) by August 15, 2026, for audit of year ended June 30, 2026.

· Pending approval by the management of Ipas management at the Headquarters (HQ) office, our office, and the management of the local Ipas field office, final reports should be issued by August 31, 2026.

PAYMENT

1. In order to fulfill this contract, the total length of the contract will be from 1 May 2026 to 17 October 2026.

2. Other payments financial implications agreement upon to be paid are:

· Both ground transportation and air travel to visit PNGOs and field to be arranged and to be paid by Ipas Nepal. Local transportation used during field travel to be reimbursed on an actual basis.

· Hotel accommodation as per Ipas Nepal rate and supporting documents to be provided.

· Airport transfer taxi hire will be reimbursed according to Ipas Nepal travel policy.

· Per diem for field travel to be paid as per Ipas Nepal policy.

3. Payment will be made after submission of invoice and other supporting invoices and reports with recommendation of Finance Manager.

4. The payment of the service fee and other fees is subject to deduction of applicable taxes. Ipas will withhold and transfer the deducted amount to the tax office.