Our Procurement / Purchasing Policy

AAIDO’s Procurement Policy is based on the principle of assuring the most cost efficient and rational use of resources for goods or services that will best serve the organization in both the immediate and long-term. The policy shall also ensure that procurements are conducted in a manner to provide open and free competition to the maximum extent practical. Staff should be alert to organizational conflicts of interest as well as noncompetitive practices among vendors that may restrict or eliminate competition or otherwise restrain trade. Awards should be made to the bidder or offer or whose offer is responsive to the solicitation and is most advantageous to the recipient with price, quality and other factors being considered.

Procedures to avoid unnecessary purchases or duplicative items should be in place at all times. No employee or agent should participate in the selection, award of a contract if a real or apparent conflict of interest is involved. A conflict of interest originates when an employee or any member of his/her immediate family, member of Board or associate, has some interest, economical or not in the procurement in a specific business or hiring the service of a particular person or business. The Project should ensure that only contracts with responsible parties are made. While this section is devoted to project purchases of goods or services via Accounts Payable, this principle applies to all project transactions.

Where a particular vendor has been selected as a preferred supplier based on the most cost effective and efficient supplier, in terms of: quality, capacity, timeliness and price competiveness, comparative invoices for exactly the same goods and services will compared on a yearly basis to determine the eligibly of the preferred supplier. Normally, the bidder offering the lowest bid will be selected as the supplier. However, if there are specific reasons why the lowest bid is recommended, this justification needs to be documented on the bid comparison.

For purchase between the local equivalent of US$500 and US$2,500, at least 3 oral quotes must be obtained and documented, and include a detailed description of name of providers, contact details and the exact description for the products to be procured.

For purchases over the local equivalent of US$2,500, 3 written quotes must be obtained and a Tender Selection Committee that should comprise of at least someone from the user department, a finance person and the procurement officer shall sit to choose the best quotation.

The following documents for each procurement should be in place (Bid Comparison Examples are attached in Appendix 7):

  1. Purchase request

  2. Appropriate number of estimates/quotes from different suppliers

  3. Purchase order

  4. Invoice

  5. Receipt

Only goods and services specified in the approved budget can be procured. Any other procurement will need written authorization from the Executive Director and funding agency/donor where applicable.

When competitive bids or offers are not obtained, justification for lack of competition should be given.

8.1 Purchase Requisition (PR)

A Purchase Requisition, specifying the identified good(s) or service(s) requested, must be completed by user officers and submitted to the appropriate programme manager for approval. These will be later submitted to the Accounts department with all appropriate supporting documentation for payment.

8.2 Purchase Order

The approved Purchase Requisition and quotation from the selected supplier are submitted to the Finance department for the completion of a Purchase Order. The Original Purchase Order is submitted to the vendor to confirm the order, as required. One copy is kept with the department that made the order. A copy remains with the Accounts Office pending full payment and delivery of the good(s) or service(s). Only after receipt and inspection of the goods is the Purchase Order together with support documentation (invoice, delivery note) submitted to the Accountant for full or final payment.

8.3 Internet Banking Policies and Procedures

Only users with signature authority can approve or release payments within the internet banking system up to the authority levels that have been assigned to them.

In order to maintain a segregation of duties, all users must have individual user ids and passwords. The duties for internet banking must be segregated as follows:

  1. The financial manager, who does not have signature authority on the bank account, must review all requests for payment. He/she should review all required documentation such as purchase order, requisition forms, vendor vouchers, etc. For salary payments, a list of employees and the amount of salary for each employee must be reviewed and signed by the Executive Director. The person who sets up the payments on-line cannot be the person responsible for reviewing the request for payments.

  2. Once the requests for payments have been reviewed, the Director, or the Deputy Director must approve each request.

  3. The financial assistant will be responsible for setting up the payments in the internet banking system.

  4. Someone with signature authority on the bank account will be responsible for approving and releasing the payments.

  5. The financial manager will be responsible for the monthly bank reconciliation which must be signed by the Executive Director

  1. Consultants and/or Independent Contractors

Definition of Consultant

A consultant is a self employed, independent contractor for whom AAIDO has no legal obligation to withhold taxes or pay benefits. Consultants are considered to be local contractors, rather than AAIDO employees, and as such are not eligible for payroll or regular employee benefits

Hiring Process/Requirements

Key consultants may be named, along with the daily rate and the scope of work (SOW), in the proposal and final contract between the AAIDO and the sponsoring organization. If the name of the consultant, daily rate and scope of work are not stated explicitly in the contract, it may be necessary to request hiring approval from the funding organization before the entering into an agreement with the consultant (it is important to refer to the contractual arrangement with the donor to determine if approval is necessary).

For consultants, a rate should be negotiated according to the terms and conditions of the contract and based on the information collected. The consultant daily rate will be based on factors such as previous earning history, market rate for comparable service, level of responsibility and complexity of assignment

Once the consultant’s rate has been negotiated and approved, a consultant agreement and work order (see Appendix 13) stating the scope of work duration of assignment, and daily rate of pay must be drafted and approved by the Executive Director. Consultants are not entitles to receive any rights, privileges, benefits, or allowances from AAIDO except as provided in the consultant agreement.

The consultant agreement must be signed by both the consultant and the Executive Director

Review/Approval Required

If required by the donor, consultants must be approved by the sponsoring agency before being hired by the AAIDO. Approvals may also be required for consultant candidates, scopes of work, and/or daily rates. It is the Executive Directors responsibility to determine what approvals are required from the donor and ensure that they are secured in writing before the consultant can begin work

Contracting and Payment Procedures

Consultants are required to submit a fee payment request (or invoice) that specifies the number of Days worked each month, the approved daily or monthly rate, and the description of activities. The request (invoice) must be reviewed and approved by the Executive Director. AAIDO pays consultants in accordance with the terms and conditions of the agreement, typically up to a maximum of 8 hours per day and 5 days per week, unless otherwise authorized in writing by the donor and/or agreement with the donor..