Content: 8.11 Closure financial audit

Content

8.11 Closure financial audit

8.11.1 Financial Audit for Project Closure

Overview

Item	Description
Purpose	Prior to the closure of project, audit needs to be conducted for Closure of the project accounts. Audit the transactions relating to any unaudited period.
Reference to Guidelines	Step 9, table 3, para 4.3, page 42 Section 4.11, page 52
Prerequisite/s	Completion of placement of candidates
Time for completion	As per the activity table below
Instructions	SI 8.4A: Common instructions on payment of entitlements, SI 8.4B: Instructions on payment of food and transportation cost, SI 8.4C: Instructions on post placement support (PPS) payment, SI 8.4D: Instructions on one time travel support, SI8.4E: Instructions on accounting of boarding and lodging expenses, SI 8.5A: Instructions for payment of salaries to trainers, master trainers and Q team members, SI 8.10F: Items to be verified during closure audit and SI 8.10G: Sample size for verification of transactions
Process owner	For APS: SRLM finance team For YPS: CTSA finance team

Activities

Step No.	Activities	Actor	Time for completion	Relevant documents
1	Finalize and share closure financial audit certificate, Closure Utilization Certificate along with audited financial statements and books of account in accordance with the applicable standards and share along with other documents as required with Annual Auditor for audit	PIA OP Team (Finance)	Within 10 months of completion of placement of candidates	SF 8.11A: Consolidated Financial Audit Certificate (for complete project) and SF 8.11E: Consolidate Utilization Certificate (for complete project)
2	Conduct Closure audit of books of account of unaudited period based on the sampling technique as per the applicable auditing standards with the sample size mentioned under SI 8.10G, as minimum	Annual Auditor	Within 1 month of sharing of books of account and other documents by PIA with Annual Auditor	SF 8.11A and SF 8.11E along with annual audited financial statements
3	Authenticate Closure Audit Certificate and Closure Utilization Certificate along with audited financial statements based on the annual audits conducted during the entire project period and audit for unaudited periods	Annual Auditor	Within 1 month of sharing of books of account and other documents by PIA with Annual Auditor	SF 8.11A and SF 8.11E along with annual audited financial statements
4	Submit Closure Audit Certificate and Utilisation Certificate along with audited financial statements as it’s annexure to SRLM (in case of APS) and CTSA (in case of YPS)	PIA OP Team (Finance)	Within 5 days of submission of Closure Audit Certificate and Closure Utilisation Certificate by Annual Auditor	SF 8.11A and SF 8.11E along with annual audited financial statements
5	Reconcile the amount of expenditure for prescribed heads, assess deviations reported in closure audit certificate	SRLM finance team (in case of APS) CTSA finance team (in case of YPS)	Within 15 days of submission of Closure Audit Certificate and Utilisation Certificate by PIA	SF 8.11A and SF 8.11E along with annual audited financial statements
6	Issue a Closure Verification Report directing the PIA to rectify deviations and report compliance	SRLM finance team (in case of APS) CTSA finance team (in case of YPS)	Within 15 days of submission of Closure Audit Certificate and Utilisation Certificate by PIA	SF 8.11B: Interim Evaluation letter of SRLM/CTSA for Consolidated Utilization Certificate (for complete project period) submitted by PIA
7	Comply with the Closure Verification Report of SRLM/CTSA and submit a Compliance Report	PIA OP Team (Finance)	Within 5 days of issue of Closure Verification Report by SRLM/CTSA as the case may be	SF 8.11C: Management response to be submitted by PIA to SRLM/CTSA
8	Review the Compliance Report submitted by PIA and issue Final Closure Verification Report. Generate notice, in case of deviations not addressed.	SRLM finance team (in case of APS) CTSA finance team (in case of YPS)	Within 15 days of submission of Compliance Report by PIA. If the Final Closure Verification Report is not sent by SRLM/CTSA as the case may be then it is deemed that PIA’s compliance report is accepted	SF 8.11D: Final evaluation letter of SRLM/CTSA for Consolidated Utilization Certificate (for complete project period) submitted by PIA

8.11.2 Financial audit for orderly closure of a project

When a project cannot be executed and needs to be closed as per process 3.9 (ii) of SOP, the procedure for foreclosure will be followed.

The order for foreclosure proceedings will specify the conditions of closure
Closure audit will follow the all the processes prescribed for closure

Closure financial audit will be conducted as per orders given for closure of project. All the expenditure incurred till the completion would be accounted for subject to the budget limited to the achievement of the physical target. Annual auditor will follow all the procedures laid down in the process “8.11.1: Project Closure financial audit”.

When a project is closed by MoRD through a closure order, expenditure incurred will be frozen after the issue of the order. The order will also specify the steps to be taken on training activities in progress on date of issue of the order and payment of entitlements to candidates.

Activities other than those specified in the order for orderly closure will not be permitted to be initiated and any expenditure incurred on such activities. Annual auditor will follow all the procedures laid down in the process 8.11.1: Project Closure financial audit.