Various new initiatives and enhancements to the process have been introduced as part of the 2014 reconciliation and report preparation. A selection of the main ones are set out below, with further details provided in the body of our report.
- The M.EITI's web-based E-Reporting system was launched, and payment information was initially reported by companies and government entities for the first time through this web-based E-Reporting system;
- KPMG examined the E-Reporting system and assessed the process for data collection, the technical platform and implications on the reliability of data and for reliance by the Independent Administrator;
Inception Workshop and Inception Report:
KPMG led a day long Inception Workshop with the MSG including various discussions on the scope of procedures and requirements of the EITI Standard. The Inception Workshop sought a consensus among the MSG regarding the Independent Administrator’s scope of work and information to be gathered for the 2014 M.EITI Report. During the Inception Workshop, MSG members provided their opinions and input, following which KPMG issued an Inception Report setting out the planned scope of the reconciliation and of the contextual information to be incorporated to the M.EITI Report;
Risk based selection of companies in tranche 2:
In agreement with the MSG, KPMG applied a risk based, sampling approach to select companies for reconciliation of payments out of a second, medium sized group of companies (which were not individually material). In this way, the Independent Administrator was able to broaden the number and range of companies considered for reconciliation;
Focus on sub-national reporting:
At the request of the MSG, KPMG has provided additional focus to the sub-national level, with separate materiality thresholds applied to determine the companies in scope, and separate consideration of revenue streams relevant at the sub-national level;
Contextual information and data gathering:
Significantly more data has been requested and gathered than in the eighth M.EITI Report as part of the contextual information requirements of the new EITI Standard. The extent and scope of this data gathering was agreed with the MSG during the Inception Workshop referred to above;
Level of assurance over data gathered:KPMG has aimed to strengthen the level of assurance over the reported payment data and contextual information, from both the companies and from the government entities. Procedures applied included requesting representation letters from the companies’ management and heads of government entities, requesting copies of the annual financial statements and audit reports, meeting with the Mongolian National Audit Office, and requesting a limited assurance attestation report from external auditors.