Transcript VI. EUROSAI Training Event Better Auditing of Public Aids

VI. EUROSAI Training Event
Better Auditing of Public Aids and Subsidies
Auditing of State Aids and Subsidies
Czech Experiences and Views
Václav Peřich, Supreme Audit Office
Prague, 6-8 November 2006
VI. EUROSAI Training Event: Better Auditing of Public Aids and Subsidies
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The Czech SAO Mandate (a)
Section 3 of the Supreme Audit Office Act
No. 166/1993 Coll.
(1) The Office shall audit:
(a) the management of state property and financial resources
collected under the law for the benefit of legal persons,
with the exception of resources collected by municipalities
or regions under their independent jurisdiction,
(b) the state final account of the Czech Republic,
(c) the implementation of the State Budget of the Czech
Republic,
(d) the management of financial resources provided to the
Czech Republic from abroad and of
financial resources for which the State has assumed
guarantees,
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The Czech SAO Mandate (b)
Section 4 of Act No. 166/1993 Coll.
(1) When carrying out audits, the Office
shall examine whether the audited
operations conform to legal regulations,
shall review whether they are
substantively and formally correct,
and shall judge whether they are effective
and economical.
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State Aids in Europe
• States and territories
– 43 traditional states (3 also in Asia)
– 10 semi-independent territories
– 3 Caucasian states
• Trade blocs
–
–
–
–
European Union 25 states, articles 87-89 of the Treaty
European Free Trade Association 4 states, similar
European Economic Area (EU+EFTA-Switzerland)
Commonwealth of Independent States 12, full-fledged
free trade zone (WTO criteria)
– Central European Free Trade Agreement 9 (3+U+K)
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State Aids in Czechia
2000
2001
2002
2003
EU (15 countries)
0.60
0.61
0.66
0.58
Euro area
0.69
0.70
0.76
0.64
Euro area (12 countries)
0.69
0.70
0.76
0.64
Czech Republic
2.42
1.93
3.94
2.47
Figures indicate % of GDP
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State policy of employment
Figures in million CZK from the Closing
Account of State Budget
active employment policy –
State Budget
2003
2004
2005
3 191
3 938
4 172
804
2 387
859
3 079
793
3 034
406
685
692
224
331
481
833
1 031
251
418
408
839
1 184
310
145
Employers of disables > 50%
524
649
737
Social impact (of restructuralization)
2 207
2 381
3 391
This includes: - investment incentives
- other tools:
This includes:
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re-qualification
public works
new selected jobs
disables employment
practice of graduates
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Central Subsidies Register (CEDR)
• 1998
• Non-investment
subsidies
• Search by name,
subject, budgetary
chapter, beneficiary
etc.
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Examples of Audit Results
Auditing
Operation
03/30
Main subject
Investment
Incentives
04/34
03/35
Employment of People
with Disabilities
05/17
04/31
Accompanying Social
Programme of
Transformation
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Volume of
funds
Audited
Irregularities
4 790
Figures in million CZK
4 505
> 100
2 135
> 700
fuzzy total
125
1 900
1 534
950
557
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Subsidies and loans for firms
Figures in million CZK from the Closing
Account of State Budget
Total of subsidies –
This includes: - Labour and Social
- Industry and Trade
- Transport
- Agriculture
- GAT*
*General Administration of Treasury
Non-investment loans
This includes: - Labour and Social
- GAT
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State Budget
2003
2004
2005
52 043
49 194
23 305
1 181
6 929
9 561
8 672
6 380
1 624
7 050
6 374
8 493
24 364
2 633
7 187
3 805
2 413
5 948
3 607
1 269
23
840
2 750
869
387
1
×
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Examples of Audit Results
Auditing
Operation
Main subject
Volume of
funds
Audited
Irregularities
Figures in million CZK
03/24
Support of SME
2 749
the lot
05/04
Research and
Development (MIT)
4 024
724
05/05
Support of
Environmentally
Friendly Farming
fuzzy total
831
05/07
Monuments‘ flood
damages repair
fuzzy total
515
fuzzy total
2 387
05/08
Support of Energy
Savings and Recoverable
Production
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too large
disproportion
between M×L
> 135
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Investment subsidies
Figures in million CZK from the Closing
Account of State Budget
Total of subsidies –
This includes: - Labour and Social
- Education
- Transport
- Health Services
- Czech Army
- ICT Systems
- Justice (incl. PPTC)
- Police
Investment subsidy for firms
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State Budget
2003
2004
2005
66 024
74 480
72 084
608
5 888
7 707
5 683
12 202
4 662
1 813
1 199
1 347
6 825
7 489
4 279
11 422
5 439
2 856
1 704
849
6 158
15 962
2 634
11 824
5 672
2 699
2 463
×
×
4 600
(5,9 %)
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ISPROFIN
• Information system on
participation of the state
budget funds in the
assets‘ reproduction
financing
• Chapter
• Programme
• Institution
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Examples of Audit Results
Auditing
Operation
Main subject
Volume of
funds
Audited
Irregularities
03/26
Building and Operation
of Railway Corridors
4 150
04/20
Measures for
Environment
Improvement
Protection against
Flood
1 700
Figures in million CZK
4 150
270
prices up to
30%
~
1 700
2 557
2 557
03/35
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Disposal of environmental burden
Figures in million CZK
7 343,0
4 943,6
2 769,7
2001
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3 228,5
2 587,3
2002
2003
2004
2005
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Example
Figures in million CZK
• 05/11
• Disposal of the old
Ecological Burdens
• >14 000
• 10 531
• Lack of good regulations
• Bad co-ordination
between ministries
involved
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Most Frequent Risks
• Inconsistency in legislation (relationships between laws,
government regulations, ministerial decrees, rules of
practice)
• Lack of managerial control - losing the ability to control
the expense growth
• Neglecting procurement regulations
• Failure of expert services
• Efficiency and reliability of used technologies - failure of
systems (control, operational, information etc.)
• Wasting and abuse of resources, fraud, conflicts of interest
• Low quality of emergency management (natural disasters,
accidents caused by the human factor etc.)
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Auditor‘s Tool Kit
• A proper grasp of assets
(balanced approach)
• Reasonable shifting
between
»helicopter–microscope«
view
• Information &
Communication
Technology
• Interface to Substantial
Expertise
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Quality of auditing process
MAPA RIZIK
10
8
1,6
6
7
14
17,5
6
12
15
18
DOPAD
15
4
2
4
2
1
2
4,5
6
3
4
20
12
5
0,5
0,25
0
-1
0
1
2
3
-2
PRAVDĚPODOBNOST
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5
1) Audit guidelines, standards,
planning and programmes
2) Ongoing operations
supervision
3) Sharing and commenting draft
documents
4) Collective system of
approving
5) Results evaluation
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Prospective views
• Expecting a new grade of
standards (95, 98, 04)
• Contributing to
strengthening of Internal
Control
• Understanding to the
State Aid Reform
• Applying scale of tools
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Thank you for your kind attention!
More information is available:
www.nku.cz/pages/en/pressrel-2006.htm
Personal contact: [email protected]
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