s milma Malabar Regional Co-operative Milk Producers' Union Limited Head Office, , 673571,, , Ph: 0495 - 2805418, 2805417,280416 Fax: 2800648, www. malabarmilma. com; E-mail : ho. asc@malabarmilma. cogp

EXPRESSION OF INTEREST REF No.MRUiACTS/55/9 1 l21l9-20 I

Inviting Expression of Interest for Internal Audit for the year 2019-20 \

milrna. Malabar Regional Co-operative Milk Producers' Union Limited Head Office, Kunnamangalam, Kozhikode 673571, Kerala,

Expression of Interest for Internal Audit for the year 2019-20

Ph: 0495 -2805418,28054 16,2805417 Fax: 2800648, www.malabarmilma.com; E-mail: [email protected]

-1.Malabar Regional Co-Operative Milk Producers' Union Ltd. (MRCMPU Ltd.) invite Expression of Interest for Internal Audit for the year 2019-20from reputed firm of Chartered Accountants in the various units of MRCMPU Ltd. The firms should be well-established and experienced in Internal Auditing and other accounting jobs. The term of Internal Auditfwill be for a period of three years with effect from 01.04.2019 as per the terms and conditions attached with this notification, subject to satisfactory completion of the first year Audit and reasonable hike in the fees will be granted on mutual consent during 2nd and 3'd year. Interested and eligible Chartered Accountants firms may obtain further information from the Head Office of the Malabar Regional Co-operative Milk Producers' Union Limited, Peringolam (P. O), Kunnaman galam, Kozhikode. 1. The offer shall be submitted in two cover system consisting of technical qualification and price offer. The price offer shall contain a detailed working of costing for the price. The price offer of those who qualifu in the technical qualification only wil1be considered for opening. 2. Detailed terms and conditions are contained in the offer document of the above work which is uploaded in the Kerala Government e-portal www. etenders.kerala. gov. in a. Offer reference No : No. MRU/ACTSI 55 19 I 12019 -22 b. Estimated offer : Rs.10.00 Lakhs per year including GST c. Offer download : Can be downloaded from the Websitewww. etenders.kerala. gov. in - d. Offer publishing date : 20.05.2019, 1 1.00 hrs. e. Offer submission closing date : 04.06.201 9, I 7.00 hrs.

f. Offer opening date : 06.06.2019, 1 1.00 hrs. o b' Offer validity :24 days

I(ozhikode sd/- MANAGING DIRECTOR I/c 20.05.20t9

2 -

TERMS AND CONDITIONS FOR THE OFFER

1. ELIGIBILITY CRITERIA

a) The Chartered Accountancy Firm should have necessary Registration Certificate from the Institute of Chartered Accountants of . Q) fne Chartered Accountancy Firm should have valid EPF registration, ESI registration, GST registration and independent EPF and ESI code numbers if applicable. c) The Chartered Accountancy Firm should have PAN of Income Tax Department.. d) The partners of Chartered Accountancy Firm should also have member number issued by the Institute of Chartered Accountants of India. e) The Chartered Accountancy Firm should submit their detailed profile along with the offer. 0 The Chartered Accountancy Firm should have its office at Calicut and those who have more branches/ tie ups, under MRCMPU's area operation from Kasaragod district to Palakkad district will be prefened. g) The Chartered Accountancy Firm should have at least Ten years' of experience in the field of providing internal audit service and accounting job. h) As on 01-07-2019, the Chartered Accountancy Firm should have minimum three qualified chartered Accountants including partners and names of Chartered Accountants shall be uploaded with the offer. i) The Firm's annual financial turnover during the last three years shall not be less than Rs.50 lakhs and the proof of the financial turnover of the last three years (audited income & expenditure statement or IT return) shall be uploaded along with the offer. j) Proof of the above eligibility criteria shall be uploaded along with the first cover ie technical qualification , failure of which will lead to disqualification of the offer.

2. pISQIIALIf'ICATTONS

a) The Chartered Accountancy Firms who were appointed earlier as internal auditors by MRCMPU Ltd. during previous years and who were unable to operate the work successfully, are not eligible for being reappointed. . b) The Chartered Accountancy Firms who do not submit along with the offer, the copies of documents, possession of registrations/licensesflPAN /Licence from the \--

Institute of s Chartered Accountants of India as in Sl .no 1(a) above, are not eligible for being appointed.

Units to be covered Head office at Peringolam, Kunnamangalam. Kozhikkode Dairy at Peringolam, Kunnamangalam. Kannur Dairy at Pallikkunnu, Kannur. Palakkad Dairy at Kalleppully, Palakkad Kasaragod Dairy at Mavungal, Kanhangad. Waynad Dairy at Chuzhali, Kalpetta. MalayoraDairy, Sreekandapuram, Kannur. Central Products Dairy, Naduvattom, Kozhikode. Procurement and Input Centres at Peringolam, Nilambur, Kannur, Kanhangad, Kalpetta, Palakkad, Pattambi, Kottakkal, Attappadi and Vadakara. j. Milk Chilling centres at Nilambur, Mananthavadi, Pattambi, Attappadi, Vadakara, Kottakkal A4oorkanad. k. Marketing Depots at Chinakkal (kottakkal)/Moorkanad, Ulliyeri, Nilambur, Pattambi, Alathur, Koyippady, ,Pathiripala and . 1. Ginger processing/feed milling plant, Meenangady.

3. The Scope of Work

The Internal Audit shall cover all activities of Head Office, Dairy Plants at Kozhikode. Kannur, Palakkad, Waynad , Kasaragod, Sreekandapuram, CPD Naduvattam and all other Units mentioned above. The work includes: 1. Verification of all books of accounts like Ledger, Cash Book, Bank Book, Journal, Register, Voucher, and other relevant records and the accounting system of HO and units. 2. Verify all records of purchase, production / manufacturing, sales, stores and all other operations, machines, vehicles etc. of Head Office and units. 3. Critically examine the various software packages used for different operations in HO and units viz. Marketing, Financial, HR, Milk billing, Stores/ Inventory, RMRD, production etc. and evaluate their performance and adequacy compared to the volume and nature of business and transactions. 4. Critically examine the various internal control systems of all units with respect to each operational area and report whether they are sufficient. If not sufficient report the same with specific suggestions for improvement. 5. Critically examine the major elements of cost such as transportation, power, fuel, repairs, consumables etc. and advise the Management for proper control, where ever necessary. 6. A route wise analysis of T C for Milk and Milk products with respect to the capacity utilisation and percentage on the value of goods transported. 7. Physical verification of stock of finished goods of milk, milk products and other products, raw materials, stores and other inventories of all units including marketing depots. It shall be done at the end of each reporting quarter (June 30, September 30, December 31 and March 31) in case of Dairy plants and at the time of each visit to other units. B. The stock registers of raw materials, finished goods and the stores records shall be verified at frequent intervals and report the mistakes / differences to the concemed unit head in writing for rectification, copy of which may be attached in the Intemal audit report. Surprise verification of major stock items and cash shall be conducted at least once in a month. You have to certify the quarterly Stock statement prepared in the Dairy / Chilling centers and submit along with the Internal Audit report. 9. Internal audit shall cover all operational areas which include purchase of milk, other raw materials, consumables, packing materials etc., processing, quality control, packing, sales, marketing, transportation, cash collections, marketing depot operations, man power outsourcing etc. 10.You have to regularly verify the records of production, quality control, marketing section etc. and reporl that the records are maintained properly and reconciled regularly, and if necessary help in reconciling the same. 1 l.Union has been outsourcing many unskilled jobs to the independent labor / other contractors. You have to examine all such agreements and payments to such contractors and see that the statutory requirements are complied with and all payments are made as per the agreement only. 12.Ensure that various rules and procedures and statutory requirements to be followed in respect of various activities are fully complied with. 13.Lot of amendments in commercial laws is regularly taking place which requires compliance of various statutory requirements. You have to reporl whether such requirements are correctly complied with. 14.Report that various orders. circulars, instructions like price of products, norms and procedures for certain activities etc. issued from the Head Office are properly implemented and complied with. 15.Verify I certify the correctness of the quarterly trial balance, P&L Account and Balance Sheet of Head Office and Dairy Plants prepared by the respective units using the computerized Accounting Package with schedules. l6.Verification of the books and records and certification of all Statements of Expenditure, like RKVY (RashtriyaKrishiVikasYojana), RSVY (Rashtriya Sam VikasYoj ana), SC /STDevelopment Projects; NDP (National Dairy plan), NPDD, GOK Plan Fund etc. or other statements to be submitted to the project authorities (ie. Gol,t of India, Govt. of Kerala, NDDB etc) as per the format and time schedule prescribed. lT.Verification of tender (E -tender also) its formalities and procedures for the purchase orders placed from Head Office regularly with regard to its correctness and accuracy that it complies with all the rules and procedures as and when required. The tender verification cerlificate is to be issued wherever necessary. l3.Verification and cerlification of ESI Returns (half yearly/yearly etc.) to be furnished to Employees State Insurance Corporation by the Dairies & Head Office. l g.Providing necessary professional and other advices as and when necessary. 20.Verification of all book of accounts of MRCMPU employees group gratuity fund trust accounts. Zl.A brief Reporl incorporating all major and relevant points (Executive Summary) shall also be fumished for each quarter along with the internal audit reporl. 22.Thelnternal Audit repofi shall be submitted for each quafter before the end of the subsequent month of each such quarler. A11 Internal audit reports shall contain a reporl on all the points mentioned in 1 to 15 above.

In addition to the above the internal auditor will focus on the following specific points: 1 Surprise verification of physical stock and tally with the software generated stock register for anY Product. 2 Date wise verification of Intra Union stock Transfer quantity of Milk and Milk products by comparing the stock register at source and destination units obtained from production software with the help of MIS deparlment for operating the sYstem. 3 euarterly Analysis of the following reports obtained from production software a. Fat and SNF loss% b. Cream to Ghee conversion losso% c. Cream to Butter conversion lossoZ d. Butter to Ghee conversion losso% e. Yield o/o of Peda, Palada Mix and Paneer and other products. 4 Tallying of Quantity in the consolidated FAT &SNF Statement and P&L Statement of DairY. 5 Date wise comparison of Market Return in the Marketing Package and Production Package in Dairies and Depots. 6 Date wise comparison of Milk procurement Quantity between Milk Bill and Production Package in Dairies and MCP/MCC. 7 Date wise comparison of Transit loss of milk between the Dairies and Depots by comparing the concerned stock register' 8 Date wise comparison of tray movement between the Dairies and Depots by comparing th; ffay movement report in the production software and quarterly analysis of broken tray%o and tray usage per liter quantity (milk and curd disPatched. 9 Comparison of Dairies based on the Head wise expenditure based on the per kg Total Solids handled. 10 Quarterly analysis of packing film cost per liter, by comparing the packing film cost and sales quantity of milk, curd and Sambharam. 11 Date wise verification of dispatch/ production quantity of milk and milk products with labor contractor bill in dairies and depots were it is out source. 12 Random checking of wholesale and retail rates of milk products in marketing package. 13 Random checking of transportation rate of route vehicle in Marketing and procurement routes. - 14 Verification of realization of Inter Union sales of milk. 15 Verification of fluctuations in the monthly handling excess quantity of milk. 16 Verification of Milk bill apportioning of BMC milk purchase data. In order to implement the above points, MRCMPU will assign the Production Head as coordinator of the internal audit function with the help of MIS Department.

General 1. The volume of work in our organization is very large. The turnover is increasing and new projects, activities, products etc. are coming regularly, and the internal audit shall cover all the activities of the Union. We expect your valuable professional advices for improving the profitability, strenglhening the systems, cost reduction, identiffing the uneconomic operations etc. Whenever any violation of rules, dilution in the controls and systems, serious discrepancy or unhealthy practice is observed during the Course of internal audit it shall be brought to the notice of the Managing Director by way of confidential letter. Similarly, you must bring to the notice of the unit heads any defect, short coming etc in the system with suggestions for rectification/ improvement of the same. 2. Considering the volume of work it is absolutely essential that you have to deploy your experienced staff in the Head Office and the Dairy Plants of Kozhikode, Kannur, Sreekandapuram, Palakkad, Wayanad, Kanhangad and CPD Naduvattom to conduct the work effectively. Therefore, attendance of at least one experienced staff for at least 10 working days in a month in the Head Office and the Dairies is essential for this engagement. 3. Visits to the Dairy and units and follow up by a qualif,red Chartered Accountant is essential for the effective conduct of the internal audit. The reports on the above visits and findings also shall form part in every internal audit report. 4. One of your experienced stafV chartered accountants shall attend the quarterly internal audit review meetings held at unit level.

-t Remuneration The remuneration excluding GST for the above work shall be offered as detailed below

DairyiUnit Amount (Rs) Head Office , 2 TMR Plants Kozhikode Dairy, its 2 depots & 3 P&I office 2 Chilling Centre Wayanad Dairy, its 2 depots and 1 P&I offlrces 1 Chilling Centre Palakkad Dairy ,its 4 depots and 4 P&I offices 3 Chilling Centre Kannur Dairy and Malayora Dairy , and 1 P&I offices Kasaragod Dairy, its I depots and I P&I offices Central Products Dairy, Naduvattom Total

15. MODE OF PAYMENT:- Quarterly payment pertaining to the Chartered Accountants Firm will be released by cheque or through online transfer on submission of the GST bills in the name of Dairy/Units as above. Statutory deductions(TDS ) if applicable will be deducted from the bill amount. A. Documents Comprising Offer: i. The First Stage (Pre-Qualification or Technical Cover based on lcover): Pre-Qualification or technical proposal shall contain the scanned copies of the documents mentioned in the tender notice, which every bidder has to upload: The MRCMPU doesn't take any responsibility for any technical snag or failure that has taken place during document upload. ii. The Second Stage (Financial Cover or as per offer cover system): The CA firm shall complete the Price offer as per format given for download along with this offer. Note: The blank price offer should be downloaded and saved on the computer without changing file-name otherwise price offer will not get uploaded. The firm making the offer should filI in the details in the same file and upload the same back to the website.

DATE: 20-05-2019

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