SELF-FINANCING, ECOLOGICAL,
SUSTAINABLE, LOCAL INTEGRATED DEVELOPMENT PROJECTS FOR THE WORLD’S POOR
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"Money is not
the key that opens the gates of the market but the bolt that bars them"
Gesell, Silvio The
Natural Economic Order
Revised English
edition, Peter Owen, London 1958, page 228
Edition 13: 07 February
2010
4.19 AUDITING STRUCTURES
The project is based on separation of powers between
the controlling party (the project NGO) “the parliament” and the executive
project coordinator “the government” nominated by the NGO to execute the
project.
Financing parties have two structures to ensure
on-going audits of the project works are carried out.
1. The project NGO fronts for the project and
maintains on-going auditing powers to ensure correct project execution. It nominates an auditing commission with 5
(7) members. The statute of the project NGO allows the financing parties to nominate
executive auditors to the auditing commission. Commission members nominated by
the NGO may be paid salaries by the NGO. Commission members nominated by the
financing parties may be paid salaries by the financing parties. For practical
purposes commission members should be resident in or near the project area.
Neither the auditing commission nor NGO may intervene directly in the execution
of the project, as this is the responsibility of its nominee project
coordinator. The auditing commission answers to the financing parties and to
the independent auditor. The auditing commission has full rights of inspection
of all project activities and documents.
2. An independent auditor nominated by the project NGO
and approved by the financing parties reports every six months to the financing
parties with copy to the project NGO. The independent auditor also submits a final audit at the close of
the two years’ executive period of the project, and after each following 12
months’ period. The independent auditor has full rights of inspection of all
project activities and documents, including the activities and documents of the
auditing commission. The independent auditor is paid by (the external financing
party, the project NGO).
3. The auditing commission may nominate one or more of
its members as executive auditors to co-sign with the project coordinator
payment authorisations concerning:
a)
Transfers of funds from a (Euro or US$) project
account with the external bank, to a formal currency account in the local
currency of (host country).
b)
Transfers of funds from a (Euro or US$) project
account with the external bank to foreign consultants contractors and
suppliers.
c)
Transfers from the formal money account in the local
currency of (the host country) to consultants contractors and suppliers of
(host country), in excess of (amount in national currency). Smaller payments
are made by the Project Coordinator from the Cooperative Local Development
Fund, subject to full registration and accountability.
d)
Transfers from the formal money account in the local
currency of (the host country) into the Cooperative Local Development Fund.
To avoid conflict of interest, neither the project
coordinator nor the independent auditor may be
members of the project NGO. They project coordinator answers through the on-going auditing commission to
the project NGO. The auditing commission answers to the project NGO and the
independent auditor. The independent auditor
answers to the external financing parties with copy of the report to the project NGO.
List of drawings and graphs.
Typical list of maps.
List of key words.
List of abbreviations used.
Documents for funding
applications.
