Download Template for auditor`s report on agreed-upon procedures

AUDITOR'S REPORT
Funding for young innovative companies
1 (3)
Auditor's report on measures to be agreed on separately
[for the recipient of funding]
We have performed the procedures agreed with you listed below, relating to funding decision No.
[xxx/xx/xxxx] by Tekes and to the cost statement drafted and signed by [the recipient of funding] [business
ID] and totalling EUR xxx for the period of [dd.mm.20yy – dd.mm.20yy].
The engagement has been carried out in accordance with the International Standard on Related Services
ISRS 4400, Engagements to perform agreed-upon procedures regarding financial information, as well as the
general terms and conditions for Tekes funding [name and date of terms and conditions] (hereinafter terms
and conditions for funding).1
The Accountable Project Leader shall be responsible for the cost statement and for ensuring that the costs
reported in it are directly related to the project and that they have been allocated for the project in a manner
required by the terms and conditions for funding and they relate to research, development or innovation
activities.
As the procedures listed below do not constitute either an audit in accordance with auditing standards or a
review in accordance with the standards on review engagements, we do not express assurance as the
aforementioned standards would require.
Had we performed additional procedures, an audit in accordance with auditing standards or a review in
accordance with the standards on review engagements, other matters might have come to our attention,
which we would have then reported to you.
The following agreed-upon procedures were carried out for the sole purpose of allowing Tekes to assess
whether the recipient had acted in accordance with the terms and conditions of funding.
1. We had access to a report related to the company's project accounting, and we interviewed [xx/xx] to
find out about
o
o
o
2.
the implementation and reliability of the project accounting
the integrity of the traceability chain and
whether the project accounting accords with the funding conditions
2We
had access to a report related to the company's working time monitoring, and we interviewed [xx/xx]
to find out about
o
o
the implementation and reliability of the working time monitoring and
whether the working time monitoring accords with the funding conditions
3. Concerning the details of the cost statement, the measures mentioned below were carried out. The
measures covered 30% of the wages and salaries stated to the project and 15% of the payments of
wages and salaries stated to the project.
o
o
o
We compared the sum declared in column 7 ("Total wages and salaries paid during the
reporting period") of the wage/salary specification to the company's payroll accounting and
ensured that 15% of the total wages and salaries had been paid.
We also compared the number of hours declared in column 4 ("Hours spent working on the
project") of the wage/salary specification to the company's working time monitoring.
We divided the monthly wage/salary based on the payroll accounting by the number of hours
specified in the collective agreement concerning the person in question or, in case there
were no such agreement, by 158 hours and compared it with the hourly pay declared in
column 5 of the wage/salary specification. / We compared the hourly pay declared in column
5 of the wage/salary specification to the payroll accounting.
1 The comparison is carried out based on the general terms and conditions that were in effect at the time when funding was granted.
2
Working hours must be recorded if the recipient of funding also receives other Tekes funding at the same time.
1 January 2016
AUDITOR'S REPORT
Funding for young innovative companies
2 (3)
4. We had access to a cost category specification of the costs declared in the cost statement, and we
carried out the measures mentioned below. The measures covered 30% of the costs stated to the
project and 15% of the payments of the costs stated to the project3. For the costs selected, we assessed
o
o
o
o
o
whether he costs are based on project accounting and the company's accounting
whether the outlays on which the costs were based have been paid
whether the costs during the project have been accrual-based
whether the outlays on which the costs are based are VAT-exempt
the cost category based presentation
For the following cost categories we also assessed:
o
o
o
o
o
whether the travel expenses are in accordance with the decision of the National Board of
Taxes
whether the company's internal material and supplies costs are at cost price
whether the machinery/equipment depreciations/rental costs are equal with the
depreciations and rental costs in the accounting
whether purchased services are based on invoice
whether the group purchases are non-profit
 A separate auditor’s report by an authorised auditor on the purchases from other
companies in the same group and associated companies is required.
Concerning the costs dealt with here, we have assessed whether the costs are eligible in accordance
with the company's eligibility criteria. Our audit only assesses the issues mentioned above. We are not in
the position to assess whether the costs are outlays due to the project. The Accountable Project Leader
carries the responsibility for ensuring that the costs shown in the cost statement are due to the project. In
case that in our review we have come to learn about other issues related to the eligibility of costs, we
have reported of them in connection with the observations below.
5. We interviewed [xx/project management] to clarify whether the company has received other public
support for the project.
6. (We interviewed [xx/project management] to find out whether the company has complied with the
legislation concerning public procurements in case of the costs stated to the project.)4
3 These sample sizes (30% / 15%) can be applied from 1st October 2010 onwards, deviating from the general terms and conditions.
4 This procedure only applies to projects in which the funding received by the company form Tekes and other public funding put
together is more than half of the expenses.
1 January 2016
AUDITOR'S REPORT
Funding for young innovative companies
3 (3)
We have observed the following:
a) In Item 1, we stated that the company's project accounting has been carried out as follows: [describes
how the company's project accounting has been carried out and specifically comments on the realisation
and reliability of the project accounting, integrity of the traceability chain, and compliance with the
funding conditions].
b) In Item 2, we stated that the company's working time monitoring for the project has been carried out as
follows: [describes how the company's working time monitoring for the project has been carried out and
specifically comments on the realisation and reliability of the working time monitoring and on the
compliance with the funding conditions].
c) In Item 3, we stated that the details of the wage/salary specification form included in the cost statement
agreed with the payroll accounting and working time monitoring [with the exception of the following
components...] and that the total wages and salaries examined had been paid.
d) In Item 4, we stated that the costs examined




were based on project accounting and the company's accounting
were accrual-based costs during the project period
the expenditure on which reported costs were based had been paid and
were VAT-exempt.
We also observed that:






The travel expenses were in accordance with the decision of the National Board of Taxes.
The company's internal material and supplies were based on cost price.
Machinery/equipment depreciations /rental costs were in accordance with the accounting.
The machinery and equipment rental costs are, at most, equal to the purchase cost
The purchased services were based on invoice.
The purchased services from group companies were non-profit.
e) In Item 5, we stated that, according to the management of the project, the company has/hasn't received
other public support for the project. [list other public support received]
f)
(In Item 6, we stated that, according to the project management, the company has/hasn't complied with
the legislation concerning public procurements in case of the costs stated to the project. [explain any
possible non-compliance with the public procurements legislation])
Our report is meant solely for the use mentioned in the first paragraph of this report. It must not be used for
any other purpose or, apart from Tekes, given to any other party. Tekes, however, shall be entitled to deliver
this report to other authorities for the purposes of supervising funding. This report deals only with the cost
statement detailed above; it doesn't deal with the [funding recipient]'s complete financial statement.
Place and date
Auditor A
HT/KHT/JHT/JHTT AUDITOR X's signature
HT/KHT/JHT/JHTT X's name in print
Address and postcode of Auditor A
1 January 2016