Audit Arrangements. The Authorized Party shall assign an external auditor/ practitioner to examine annually, in compliance with the “Terms of Reference: Assurance Engagement for Funds Disbursed under the Disbursement in Tranches Procedure” (Attachment C5) whether or not the Funds have been managed properly. The annual audit reports (signed original documents including the corresponding “Statement on Internal Control”, if any) shall be presented to KfW no later than three months after the end of the Authorized Party’s financial year. If the initial disbursement is effected during the first half of the financial year, the first audit shall be presented to KfW no later than three months after the end of that financial year. If the initial disbursement is effected during the second half of the financial year, the first audit shall be presented to KfW not later than three months after the end of the following financial year. In this case, the period under review may cover up to 18 months. The final audit report shall be presented no later than three months after the end of the financial year in which the final payment out of the Special Account or a Local Special Account is effected or six months after the final payment out of the Special Account or a Local Special Account, whichever occurs earlier. The audit costs for the external auditor shall be borne by the Authorized Party.
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