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Pacific Private Sector Development Initiative TERMS OF REFERENCE Project TA-8378 REG: Pacific Private Sector Development Initiative, Phase III - Internal Audit in Banking Expert (46510-001) Professional Group D Job Level 6 Expertise Internal Audit in Banking Expert Expertise Group Accounting, Auditing & Statistics Source International Objective and Purpose of the Assignment The National Commercial Bank of Timor-Leste (BNCTL), formerly the Institute of Microfinance Timor-Leste (IMfTL), was granted an unrestricted banking license in July 2011. The bank continues to implement a process to transition into a sustainable, best practice commercial bank, with assistance from the Asian Development Bank (ADB).

The assignment will support the commercial transformation of BNCTL desired by the BNCTL Board of Directors by contributing to a strong internal control system. The Government of Timor-Leste and the Board of Directors have requested ADB technical assistance to support the Audit Committee and Internal Audit Department of BNCTL to strengthen the internal audit function. Scope of Work The expert will: (i) Assist the Audit Committee and manager of the Internal Audit Department of BNCTL to review policies, procedures, and organization of the Internal Audit Department; (ii) Assist the Audit Committee and manager of the Internal Audit Department to develop and implement an appropriate internal audit plan, and contribute to the development of staff capability within the Internal Audit Department; and (iii) Assist the Audit Committee to develop processes to ensure that internal audit findings and recommendations are implemented. Detailed Tasks and/or Expected Output The expert will undertake the following tasks: A. Policies, procedures, and organization of the Internal Audit Department 1. Review and advise on the structure and resourcing of the Internal Audit Department, and the roles and responsibilities of Internal Audit Department staff. 2. Assess adequacy of qualifications and experience of Internal Audit Department staff relative to requirements, and make recommendations on the type of training needed to redress any gaps. 3. Review the adequacy of bank policies, procedures, and manuals for internal audit and make recommendations for change consistent with the regulatory and banking environment in Timor-Leste, and to assure that the internal audit function appropriately monitors (i) the effectiveness and efficiency of internal control, risk management, and governance systems; (ii) reliability, effectiveness and integrity of management information systems and processes; (iii) compliance with applicable legal and regulatory requirements; and (iv) safeguarding of assets.

B. Internal audit plan development and implementation 1. Prepare an annual or multi-year internal audit plan with detailed audit schedule, milestones, and key performance indicators (KPI), for implementation by the Internal Audit Department, in cooperation with the manager of the Internal Audit Department and the Audit Committee. 2. Assist the manager and staff of the Internal Audit Department with the implementation of the internal audit plan during the assignment period, including at the branch level, with a focus on developing the capability of Internal Audit Department staff to conduct the internal audit function effectively. 3. Identify remaining uncontrolled risk exposures and bring them to the attention of the manager of the Internal Audit Department and the Audit Committee.

C. Actions to address internal audit findings and recommendations Assist the Audit Committee to develop KPIs for the internal audit function and develop processes for implementing and monitoring internal audit findings and recommendations.

ASIAN DEVELOPMENT BANK

https://uxdmz06.adb.org/OA_HTML/adb/xxcrs/jsp/ADBCsrnFwd.jsp? sel=115852

29/07/2014

Oracle Applications

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The expert will undertake the detailed tasks specified in this TOR in accordance with the National Strategy to Promote Gender Equality in Private Sector Development coordinated by the State Secretary for Support and Promotion of the Private Sector Timor Leste (SEAPRI) and the Strategic Plan 2012 – 2017 developed by the Secretary of State for the promotion of Equality (SEPI).

In undertaking this assignment, the expert will provide 26 weeks of consulting input over 9 consecutive months, up to 145 days in total. All consulting services will be undertaken in Timor-Leste. The expert will work under the supervision of the task manager in ADB’s Pacific Liaison and Coordination Office. Within BNCTL, the expert will report to the Chair of the Audit Committee and will work closely with the manager of the Internal Audit Department. When required, the expert will also undertake briefings for, and provide advice to, the BNCTL Board of Directors, at the request of the Chairman of the BNCTL Board, consistent with the detailed tasks specified in the TOR. The Expert will provide a proposed work plan for the duration of the assignment to the ADB task manager and the Chair of the Committee of BNCTL within two weeks of the start of the assignment. The expert will also submit brief monthly progress reports to ADB and the Chair of the Audit Committee of BNCTL. Minimum Qualification Requirements Essential 1. Experience in establishing and/or managing internal audit departments in commercial banks in developing countries, and preferably in the Asia-Pacific region. 2. At least 15 years of relevant professional work experience in operational aspects of commercial banking, particularly in internal audit and risk management. 3. At least 10 years of relevant professional work experience in a senior capacity in a commercial bank or financial institution. 4. Demonstrated experience in developing and implementing internal audit plans for a commercial bank. 5. Good knowledge of current international standards for internal audit in commercial banks. Desirable 1. Experience in Timor-Leste. 2. Experience in an advisory or mentoring role in a commercial bank in a developing country. 3. Experience in the commercial transformation of microfinance or microbanking institutions. 4. A university degree in auditing, accounting, finance, public or business administration, or a related field; preferably at a postgraduate level or its equivalent. 5. Professional certification in auditing or accounting. 6. Communication skills in Bahasa Indonesia or Tetum, in addition to English.

Minimum General Experience 15 Years Minimum Specific Experience 10 Years (relevant to assignment) Regional/Country Experience Required

Deliverables

Type

Inception Report Interim Report Draft Final Report Final Report

Report Report Report Final Report

Schedule and Places of Assignment City and Country Dili, Timor-Leste Total

Estimated Submission Date

(chronological and inclusive of travel) Estimated Start Estimated End Working Days Other Details Date Date 145 01-Sep-2014 31-May-2015 Intermittent; Max. Working Days/Week: 5 for Home Office, 6 for Field 145

For full job description please visit: https://uxdmz06.adb.org/OA_HTML/adb/xxcrs/jsp/ADBCsrnFwd.jsp?sel=115852 -- 29 July 2014

ASIAN DEVELOPMENT BANK