Empanelment of CA Firm for Internal Audit of AAI Cargo Logistics and Allied Services Company Limited

Scope of Work

Major areas to be covered during the course of Internal Audit

The Internal Audit shall be carried out in accordance with the Auditing Standards and Accounting Standards prescribed by the Institute of Chartered Accountants of India and will include such tests and controls, as the Auditor considers necessary under the circumstances. The scope of Internal Audit encompasses the examination and evaluation of the adequacy and effectiveness of the organization’s system of internal control with special emphasis on the following:

1. Financial Accounting & Financial Reporting Systems

The overall Financial accounting & Financial reporting system to be checked thoroughly with the special stress on the below items:

a) All Accounting is being done as per Accounting Standards and Accounting Policies of AAICLAS.
b) Cash, bank, journal vouchers including rectification vouchers are prepared correctly and trial balance is prepared accordingly.
c) Bank statements & monthly bank reconciliation statements.
d) Maintenance of Cash Book and Cash verification including position of soiled notes.
e) Balance confirmation with all Debtors & Creditors.
f) Foreign currency transactions.
g) TDS & payment of Statutory dues in time.
h) Prior period adjustments.
i) Provisions and contingent liabilities.
j) Bank Guarantees & FDRs.
k) Timely recovery of advances and interest.

2. Billing and Receivable

a) Checking the billing terms and conditions as per the provisions of the contract.
b) Ensure that the timely bills are being raised as per provisions of the billing terms and conditions. Major deviations are to be reported.
c) Check the charges applicable for various cargo activities in line with the major and non-major airports as the case may be.
d) Collections from the client with respect to the collection period. Scrutiny of receipts in bank.
e) The review of the receivables has been carried out as per Guidelines issued by Company from time to time.
f) Receivables ageing and realization analysis.
g) Review of Security Deposits.
h) GTO figures provided by the contractors may also be verified as submitted by the contractors for royalty computation.
i) In case of final bill, ensure that it should include variation in quantity, non-schedule items, price escalation etc, if any.
j) Reconciliation of PDA as per ICMS and SAP to be carried out.

3. Procurement of materials and services

a) Robustness and sufficiency of processes.
b) The tenders should be floated as per commercial manual, and approval of the competent authority as per the DOP.
c) Verification of purchase procedure on the basis of indents, purchase orders, quotations, price comparative statements, authorized distributor list, etc.
d) Checking of material receipts on the basis of purchase orders, delivery challans/ invoices, weigh slips with the goods receipt notes.
e) Compliance to quality control procedures.
f) Checking issue of materials on the basis of issue slips, authorized signatory list, etc.
g) Earnest money provided should be kept in safe custody and to be checked for sufficiency and validity.

4. Profit and Loss Analysis

Comparing the actual expenses incurred with the budget estimates and analyzing the variances. Obtaining comments from the management.

5. Establishment matters

a) Checking of wages and salaries of different categories of employees including officers, contract staff, monthly and daily rated workers on the basis of their respective terms and conditions of employment.
b) Test check a few individual files of personnel posted at site.
c) Comparison of actual manpower deployment with the monthly budgets.
d) Ensure compliance of PF and ESIC laws.
e) Payroll and leave records.

Eligibility Criteria

The Bidder should fulfil all the following parameters for evaluation of Technical Bid: –

(i) The Bidder should be a Partnership Firm / LLP of Chartered Accountants and Cost Accountants registered in India having experience of 10 (Ten) years.

(ii) The Bidder should have average annual gross receipts / turnover (total consultancy fee, filing fee etc. charged in the process of usual business but excluding other Income) of Rs. 4 (Two) crores in the last 3 (Three) completed financial years i.e. 2018-19, 2019-20 and 2020-21.

(iii) The Bidder should have minimum 3 (Three) full time qualified CA/CMA as partners out of which at least 1 (One) should be having at least 8 years of post-qualification experience in the internal audit field.

(iv) The Bidder should have minimum 5 (Three) paid qualified CA/CMA (other than partners) out of which at least 3 (One) should have minimum 5 years post qualification experience in internal audit field.

(v) The Bidder should have undertaken similar internal audit assignments of at least 3 (Three) Central /State PSU / Listed / Public Limited Company having annual turnover of Rs.400 crores or more for a continuous period of at least one year in the last 3 financial years i.e. 2018-19, 2019-20 and 2020-21

(vi) The Bidder should have full time office in Delhi/NCR

(vii) The bidder should not have been debarred/ black listed/ disqualified by any regulators/ statutory body in India.

Evaluation criteria

Evaluation will be done only for the bidders satisfying all the parameters of eligibility criteria.

The Bidders/Applicants should fulfil the following Evaluation criteria:

1. Legal Status of the Bidder

The Bidder should be a Partnership Firm / LLP of Chartered Accountants registered in India having experience of 10 (Ten) years.
Minimum marks for 10 years’ experience will be 5. For each additional full year of experience, 1 additional mark will be awarded subject to maximum of 10 marks.

Documents to be submitted Self-Certified copy of Registration issued by Institute of Chartered Accountants of India.

2.Financial capacity

The Bidder should have average annual gross receipts / turnover (total consultancy fee, filing fee etc. charged in the process of usual business but excluding other Income) of Rs. 4 (Two) crores in the last 3 (Three) completed financial years i.e. 2018-19, 2019-20 and 2020-21
Minimum marks for the criteria for having average annual turnover / receipts of Rs. 4 Crores in the last 3 completed financial years will be 5. For each additional Rs. 1 (one) crore turnover / receipts, additional 1 mark will be awarded subject to maximum of 10 marks.

Documents to be submitted Audited financial statements of the firm (Balance Sheet, Profit and Loss Account) duly certified.

3. Experience

The Bidder should have minimum 3 (Three) full time qualified CA/CMA as partners out of which at least 1 (One) should be having at least 8 years of post-qualification experience in the internal audit field.
Minimum marks for the criteria will be 5. The Partner who will associate /deal with AAICLAS should be named. The Partner having 8 years of post- qualification experience should only be named. The bidder having the partner so named having experience of more than 8 years will be awarded one additional mark for each additional year of experience in internal audit subject to maximum of 10 marks.

Documents to be submitted List of the partners along with the resume giving the brief details of relevant experience in Internal Audit and the membership no. The list should be attested by Managing Partner / Senior Partner establishing the fulfilment of criteria.
The resume should separately mention the work done and period of experience in Internal Audit.

4. Service Provider Resources

The Bidder should have minimum 5 (Three) paid qualified CA/CMA (other than partners) out of which at least 3 (One) should have minimum 5 years post qualification experience in internal audit field.
Minimum marks for the criteria will be 5. The above qualified employee who will associate /deal with AAICLAS should be named. Employees having 5 years of post-qualification experience should be named. The bidder having the employee so named having experience of more than 5 years will be awarded 1 additional mark for each additional year of experience in Internal Audit subject to maximum of 10 marks.

Documents to be submitted List of qualified CA’s as per payroll listing along with the Segment handled, membership no. and post qualification experience in Internal Audit. The list shall be certified by the Managing Partner / Senior Partner establishing the fulfilment of criteria.

5. Assignment Undertaken

The Bidder should have undertaken similar internal audit assignments of at least 3 (Three) Central /State PSU / Listed / Public Limited Company having annual turnover of Rs.400 crores or more for a continuous period of at least one year in the last 3 financial years i.e. F.Y 2018-19, 2019-20 and 2020-21
Minimum marks for the criteria will be 5. For each additional similar assignment handled for a continuous period of at least 1 year during last 3 financial years, additional 1 mark will be awarded subject to maximum of 10 marks.

Documents to be submitted List of assignments with organization name, nature of assignment undertaken, F.Y. for which assignment undertaken, date of completion of assignment and turnover for the relevant F.Y. The list shall be certified by the Managing Partner / Senior Partner.
Proof of execution of services / other credentials (award letter and certificate of completion/certificate of continuation of service in case of ongoing assignment on company Letter head clearly indicating services provided, financial year of provision of service, etc) and Audited Balance Sheet & P&L of the client for determining the turnover.

Special Terms and Conditions

1. Period of Contract

The Period of engagement of Auditor shall be Three (3) years from the date of acceptance of award of Contract by the Auditor, which may be renewed for another three years subject to satisfactory performance of the Firm and with the mutual consent of both the parties.

2. Payment Terms

No Advance shall be paid by AAICLAS. The payment shall be released after the presentation of the respective report to the Management of AAICLAS subject to approval of Competent Authority.
All payment shall be subject to recoveries towards statutory deductions. The payment will be made by electronic transfer.

3. Security Deposit

The Successful bidder shall be required to pay the 3% of the contract value towards security deposit/Bank guarantee (proforma of BG attached). SD so required can be deposited by the bidder or can be deducted by AAICLAS from the payment to be made. The SD/BG amount so recovered will be released after 6 months from the successful completion of the contract. No interest shall be paid on SD deposited by the party.

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