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Support to the Central Bank of Tunisia in the adoption and implementation of IFRS in

the financial sector

Eselection id 83076

Please see below clarification requests received and responses provided:

Q1:

In the paragraph Cost estimate for the Assignment in the tender announcement

document it is mentioned that The Contract award is subject to availability of funding,

the performance of the selected Consultant and the business needs, the Assignment may

be extended beyond the current scope. Does it mean that the scope may be changed

during the project and if yes, how this will impact the budget?

A1:

It is not envisaged now that the scope will materially change during the project, and hence

the financial proposal should be based on the current scope.

Subject to further availability of funding, performance of the selected Consultant and the

business needs, the Assignment may be extended beyond the current scope

Q2:

The scope relates to IFRS and particularly IFRS 9 regulatory framework

development, implementation, impact assessment etc. It is quite clear that the scope

mainly related to IFRS 9 which is the most relevant standard for banking system. 4th

and 5th tasks require development of the regulatory framework related to the

application of IFRS and particularly IFRS 9, as well as review of the first application

of IFRS by FI. At the same time, the 4 th and 5th deliverables about methodology and

reporting of the application impact, supervisory monitoring refer to IFRS 9 only. This

is leading to a misunderstanding and we would like to have a clarification about at

which extent other IFRSs than IFRS 9 should be treated?

A2:

The impact of application of IFRS should be assessed in general. The impact of IFRS 9 is

expected to be most relevant. The scope of the monitoring will not be limited to IFRS 9, if

it appears that other standards than IFRS 9 will have a relevant impact.

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Q3:

Is it assumed that key expert 1 : Senior international IFRS expert will take the role

of Team leader/Project manager or this role can be taken by another expert not

included in the experts list?

A3:

The role of the leader/ project manager could be performed by another expert not included

in the list of the four experts. However, like all staff involved in the project, the project

leader must not have any ongoing statutory audit or advisory assignments on the subject

of the transition to IFRS of a Tunisian financial institution at the time of submission and

must undertake not to accept this commitment during the implementation period.

Q4:

The individual experts hired for the mission must have neither a legal audit mission

nor an advisory project in progress on the subject of the transition to IFRS

standards of Tunisian financial institutions before the start of the mission and must

agree not to accept such a mission during the mission implementation period. To

avoid any ambiguity, this restriction does not apply to the consulting firm but only

to the specific experts appointed for the mission to the EBRD and the CBT.

We are looking to understand:

If experts engaged in completed legal audit missions or projects related to the

transition to IFRS are eligible to this request for proposals?

A4(1):

Yes, if these missions are completed before the start of the TC on IFRS.

Q4(2)

If the following missions considered as Advisory projects on the subject of the

transition to IFRS of a Tunisian FI:

- IFRS training

- Impact study of application of IFRS

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A4(2):

These missions should not be considered as advisory projects on the subject of the

transition to IFRS.

Q 5:

Component one : Draw parallels with relevant experience in comparable countries

to inform CBT and steering committee of the issues and options of transition we

need to confirm the following:

- Are there any limitations on the number of countries that will be used as

benchmarks?

- The benchmark will be conducted based on available public information? or we

will have access to persons from other centrals banks (to perform interview or

questionnaires) through contacts arranged by the CBT?

A5:

There are no limitations on the number of countries that will be used as benchmarks.

The Benchmark will be based on information available to the tenderer. CBT does not

commit to arrange interviews or questionnaires with other central banks.

Q 6:

Component two: Review and evaluate the implementation of IFRS by Tunisian

financial institutions:

- For the macro study what is the expected output: Are we talking about high level

impact (such as high/Moderate/Low impact or are we expecting some

quantitative results in term of percentage for example?)

A6:

CBT is expecting quantitative results for the macro study.

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Q7:

Component three: Undertake an impact assessment of the implementation of IFRS

9:

- What is the expected coverage for the impact assessment? : Sample or All FI. If

it’s a sample, can we have the number of the Banks that will be included in the

sample

- What is the level of precision and granularity expected from this impact

assessment?

- Will we have access to persons from the concerned banks? Or the study will be

carried out only based on data communicated by the CBT?

A7:

A representative sample must be undertaken for the impact assessment.

CBT will provide the Consultant with access to all relevant documentation and

information necessary for the successful completion of the Assignment. Consultant shall

have access to persons of the banks concerned if the CBT deems it necessary.

Q8:

Component four: 4: Support CBT in developing the regulatory framework relating

to the application of IFRS and in particular IFRS 9:

Could you please clarify the content of the Supervisory monitoring manual?

A8: To be provided

Q9:

Concerning the restrictions of the individual experts assigned to the engagement :

Individual experts engaged for the assignment must not have neither statutory audit

missions nor ongoing advisory projects on the subject of the transition to IFRS of

any Tunisian Financial Institutions before the start of the assignment):

- Is the restrictions apply only to the key experts (1, 2, 3 and 4) or apply to all the

team. Can we have some juniors or seniors (3 to 4 years’ experience) that we will

work on this project and on the same time they are part of statutory audit teams of

FI or working on IFRS engagements for FI?

- We understand that the restrictions should apply only at the start of the

assignment. So if we have experts that are currently part of statutory audit or IFRS

project team, they can be assigned on the project since they will no longer

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participate on the statutory audit or IFRS projects from the start of the project (i;e

september 2020). Could you please confirm our understanding?

A9:

The Restrictions are applied to all staff members.

All staff members must not have any ongoing statutory audits or advisory assignments

on the subject of the transition to IFRS of a Tunisian financial institution at the signing

date of the contract and must undertake not to accept this commitment during the

implementation period.

Q 10:

Will the Consultant's team (in particular the 4 key experts) be able to share tasks

with CBT's staff/experts (as it will be as useful for knowledge transfer as for

capacity planning)? If yes, can you please give an estimate of the number of

individuals and profiles available from the CBT during the 3 years?

A10:

The CBT will provide sufficiently qualified staff to work closely with the Consultant.

Q11:

If unexpected circumstances cause the required adoption of IFRS by FIs to be

postponed to a later date (2022 or 2023 for example), will the commercial terms of

the assignment be renegotiable?

A11:

If the adoption of IFRS is deferred to 2023 or later, the tenderer will be required to

prepare, before the end of the mission, a methodological document to assist CBT in

conducting the study of the first observation of the impact of the implementation of

IFRS. The study will be undertaken by central bank staff.

Q 12: What do you mean by “Local Expert” mentioned in the paragraphs Key

Expert 3 and Key expert 4? An expert who has a professional experience related

only to Tunisian financial institutions or he could be working on emerging markets

and similar operating environments, not necessarily Tunisian ones. Otherwise, the

situation will contradict the first condition “The individual experts engaged for the

assignment must not have neither statutory audit missions nor ongoing advisory

projects on the subject of the transition to IFRS of any Tunisian Financial

Institutions before the start of the assignment and must agree not to accept such

engagement during the implementation period of the assignment”.

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A12:

Local expert (experts 3 and 4) may not have international experience. He may have

worked only in the Tunisian market or in an emerging market or any similar operating

environment. The individual expert must not have any ongoing statutory audits or

advisory assignments on the subject of the transition to IFRS of a Tunisian financial

institution at the time of submission and must undertake not to accept this commitment

during the implementation period.

Q13:

In our application, we put only the curriculum vitae of the four key experts or those

of the whole team involved ?”

A13:

In their applications, tenderers are invited to present Curriculum vitae of the whole team

involved.

1) CBT Project Team

Could you detail the project management set-up in place at Central Bank of Tunisia

?

Profile of CBT resources composing the project team

Anticipated workload

Interactions with the consulting firm

2) Meaning of “Regulatory framework”

The project includes “Supporting the CBT in developing a regulatory framework

relating to the application of IFRS and in particular IFRS9 by FIs”. Could you

detail the scope of the regulatory framework which is expected ? Is it limited to

IFRS principles and interpretations ? Does it include consequences on prudential

measures ?

Reponse to the above questions be provided.

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Q14:

We would like to submit for the following engagement:

https://www.ebrd.com/work-with-us/procurement/pn-83076.html and we are

advancing with the proposal preparations. However, due to the given COVID-19

circumstances around the world we have realized that we need more time than

initially planned. Therefore we would appreciate if the deadline of May 26, 2020

would be extended by another 3 weeks. (there is also Ramadan Religious Holiday in

Tunis and Middle East)

A14:

It is been agreed to extend the deadline until 29 May 2020

Q15:

TOR Reference

CNC announced the adoption of international accounting standards IAS/IFRS by

2021 for the preparation of consolidation of financial statements for all listed

companies and financial institutions (banks, insurance companies, leasing

companies and microfinance institutions):

We understand that it will include the full adoption and implementation of IAS, IFRS,

Basel 2 and Basel 3 by 2021. Such as,

IAS 1

IAS 10

IAS 12

IAS 16

IAS 19

IAS 20

IAS 21

IAS 23

IAS 24

IAS 27

IAS 28

IAS 33

IAS 37

IAS 38

IAS 40

IFRS1

IFRS 2

IFRS 3

IFRS 9

IFRS 10

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IFRS 15

IFRS 17

A15:

The scope of this project included only implementation of IFRS standards.

Q16:

TOR reference: Implementation is required by 2021, three years project:

We understand that the project will start by Q3 2020, does it means it includes

implementation and post implementation assessment also?

A16:

Yes

Q17

TOR reference: Monitoring the implementation by FIs of their roadmaps:

Does it include the implementation and post implementation assessment for all FIs?

A17:

All FIs or an exhaustive sample of FIs.

Q18:

TOR reference: Carrying out an impact study of the first application of IFRS by FIs:

Whether the current state information would be available to perform impact study?

A18:

Information will be provided by the CBT.

Q19:

TOR reference: Capacity building of the CBT staff, particularly on the validation

calculating expected credit loss and internal rating systems:

For validating the expected credit loss, whether the DPD details are available.

We require clarity on internal rating system, as per our understanding internal rating

system is currently not available with regulators.

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A19:

Response still pending

Q20:

TOR reference: Provide information on the regulatory and operational frameworks

adopted by comparator countries (central banks and/or prudential supervisors) for

the first adoption of the IFRS and the application of IFRS 9, which are pertinent to

the Tunisian case and whose experience can be drawn upon:

First adoption of IFRS and application of IFRS 9, whether the global experience

would be also acceptable as it is the first- time adoption in Tunisia.

A20:

Yes. International experience is required.

Q21:

TOR reference: Carry out a first macro impact study of the adoption of IFRS on the

financial situation and equity of FIs (this impact analysis must concern all IFRS

standards having a significant impact on the equity of FI):

First macro impact study for adoption of IFRS requires current data to assess the

impact on the equity. Whether the information would be provided to the consultant

from FIs to perform the impact assessment on the opening equity?

A21:

The Consultant will have access to available data provided.

Q22:

TOR reference: Provide assistance to the CBT project team in the interpretation

and analysis of the results of the application of the IFRS and especially the

IFRS9, particularly in terms of validation of the models for calculating the

expected credit loss and the internal rating system:

For implementation of IFRS 9, whether DPD information would be provided to

the consultant at FIs level and if any international rating system is available at

CBT level?

A22:

Response to be provided.

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Q23:

TOR reference: Carrying out an impact study of the first application of IFRS

by FIs:

Whether the current state information would be provided to perform the impact

study for FIs?

A23:

The Consultant will have access to the available data provided by banks.

Q24:

Reference: Cost Estimate for the Assignment: EUR 456,000.00 (exclusive of

VAT):

Does the project cost includes full adoption of IAS, IFRS and Basel along post

implementation assessment?

A24:

No.

Q25:

TOR reference: Corporate consultancy services are sought. The Consultant will be

a firm preferably with previous project experience related to:

- successfully managing the implementation of IFRS projects at commercial

banks in emerging markets and similar operating environments, including

IFRS reporting and in particular standards related to the presentation of

financial statements, consolidation, financial instruments and leasing,

preferably in… :

As we understand this is the first time adoption if IAS/IFRS at Tunisia, whether

our global experience of consultant in implementing IAS/IFRS would be acceptable

such as Jordan, Middle East, etc?

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A25:

Yes.

Q26:

TOR reference: Implementation of accounting standards applicable to Islamic

banks:

Does it also includes the Islamic Institutes, Islamic Financing Companies, etc?

A26:

Only Islamic banks and leasing companies.

Q27:

TOR reference: The Consultant is expected to have sufficient local presence in

Tunisia.

We need some clarity on this point, as this is the first time for Tunisia to adopt

IAS/IFRS. Other regions experience would be considered or not in this regard.

A27:

The Consultant should have an international experience and a local presence in Tunisia .

Q28:

TOR reference: Key Expert 1: Senior International IFRS Expert – preferably with…

Does it includes the experience of overall IFRS implementation or

particularly only IFRS 9?

A28:

Overall IFRS

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Q29:

TOR reference: Firm’s experience in successfully managing the implementation of

IFRS projects at commercial banks in emerging markets and similar operating

environments, including IFRS reporting and in particular standards related to the

presentation of financial statements, consolidation, financial instruments and

leasing, preferably in… :

We need some clarity on this point, whether other regions experience would be

also acceptable/considered?

A29:

Yes, other international experience is required.

Q30:

TOR reference: Firm’s experience in implementation of accounting standards applicable to Islamic banks –5%:

Does it include other Islamic Institutes, such as Islamic Finance Houses/

sharia Companies?

A30:

No/To be confirmed