Transcript Country Report of the Turkish Court of Accounts

Musa KAYRAK
Senior Auditor, CISA
12-14 November, Moscow
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Established by virtue of the Constitution and
enjoys a permanent legal status
 Mentioned the first Constitution(1876 ) of the Ottoman
Empire (Chamber of Accounts)
 Maintained its status in 1924, 1961 and 1982
Constitutions of the Turkish Republic.
 The Law on the TCA
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The 'court' with a judicial function
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A fixed term under the Constitution or law
◦ The fix term of office of the President of Turkish
Court of Accounts shall be five years. May be
elected twice at most.
◦ Members are elected until retirement.
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Independent of the legistlative, executive and judicial
branches
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Enjoys financial independence without any
intervention of the Ministry of Finance
◦ Within the scope of the general budget
◦ Preparing its own budget independently
◦ Does not have to follow the general budgeting procedures
as it is the case for other public administrations under the
general budget.
◦ According to the article 62 of the Law on the TCA, the
Presidency of TCA shall submit its budget directly to the
Turkish Grand National Assembly (TGNA) and forward one
copy to the Ministry of Finance.
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The Turkish Grand National Assembly has the final
say on the budget of the TCA.
◦ However, in practice, the TCA does not face any budgetary
limitation imposed by the TGNA.
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Central or national government agencies, bureaus,
offices, instrumentalities and local government units
at all levels
In addition to this, the TCA has the power to audit:
 All types of administrations, organizations, institutions,
associations, enterprises and companies affiliated to, or
founded by public administrations provided that the public
share is no less than 50%;
 Domestic and foreign resources and funds, including European
Union funds;
 All public accounts, including private accounts, funds, resources
and activities regardless of whether these are in the public
administrations budget;
 Accounts and transactions of international institutions and
organizations within the framework of the principles set out in
the relevant treaty or agreement
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Performance Audit
Regularity Audit
1. Compliance Audit
2. Financial Audit
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Environmental Audit
Value for Money Audit
IT Audit
Others: Trial of accounts as a result of
regularity audits
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Yes but mostly indirectly linked with anticorruption except for the followings:
◦ The article 78 of the Law on the TCA specifies
detailed steps to be taken by the auditors and the
Court in the event of encountering an action
involving corruption in the course of audits and
examinations.
◦ The Regulation on TCA Audit involves detailed
articles concerning the cases of corruption such as
evidences and documents to be collected,
examination methods, format for written
communication with the Presidency of the TCA,
responsibilities of the Chambers etc.
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A draft version of the anti-corruption strategy
of the TCA is ready to be approved.
◦ “The Anti-corruption Strategy of the Court” at the
end of 2012 and currently an expert team works on
the 1st draft of the strategy and its action plan.
◦ By the end of 2013, the strategy will be officially
accepted and begin to be implemented in line with
its action plan.
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“The National Anti-corruption Strategy” which
specifies four separate tasks for the TCA.
“The Strategic Plan of the Court (2014-2018)”
mentions the fight against corruption in Turkey as a
crucial task for the TCA in accordance with the NACS.
Main action: Prepare “the Anti-corruption Strategy of
the Court”
“The Strategic Plan of the Court (2014-2018)”
involves some other action indirectly related to the
anti-corruption efforts of the Court.
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Detecting corruption already embedded in
the regular audit services but merely
incidental to the audit services being
rendered and not an audit focus.
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No specific unit
All departments, offices or units conducting
audit are mandated to prevent and detect
corrupt activities and transactions
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The compulsory two year-long vocational
training for assistant auditors
In-house trainings on a variety of subjects
which contribute to knowledge on
anticorruption help auditors enhance their
skills to combat corruption.
Yet, no specialized group of auditors like
certified fraud examiners.
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No.
But two year vocational training for assistant
auditors consists of courses on several
subjects such as Procurement Law,
Accounting, Personnel Law, Social Security
System and hands-on training helping
auditors detect suspicious cases of
corruption.
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No
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Proactive and reactive
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If auditors encounter with a case of corruption steps to be
taken are as follows:
1.
2.
3.
The evidence shall immediately be identified and the case shall
be reported to the Presidency of Turkish Court of Accounts by
the auditor.
The Chamber assigned by the Presidency of Turkish Court of
Accounts evaluates the sufficiency of the initial evidences for
public prosecution.
If the collected initial evidence is qualified as subject of public
prosecution, the file shall be sent to the Chief Prosecutor of
Turkish Court of Accounts either to be handed over to the
responsible official’s public administration for the necessary
action to be taken, or to be sent directly to the Public
Prosecution Office for an investigation in accordance with the
nature of the offence.
◦ Anti-corruption researches
◦ Promulgation of accounting and auditing rules and
regulations
◦ Declaration of assets and liabilities of public
officials
◦ Governing Code of Ethics for Government
Accountants and Auditors
◦ Public Information Office with linkages to all sorts
of media
◦ Updated publication of audit reports through the
SAI’s website
Conflict of Interest
Fraud
Illegal gratuities
Asset misappropriation
Embezzlement
Forgery
All types of Illegal activities in public procurement
procedures
◦ Online frauds or frauds using the computers
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1.
2.
3.
4.
Compliance audit
Financial audit
Performance audit
IT audit
1.
2.
3.
4.
Cross control of data obtained especially
from different sources (ACL, MS Access,
SQL, SAYDAP, MS Excel)
Physical observation/site visit
Risk analysis
Analysis of complaints and referrals
received
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The Turkish Court of Accounts has uncovered
tens of suspicious cases of corruption in the area
of public constructions such as public buildings,
roads etc. and sent them to the Office of Public
Prosecutor for necessary judicial actions.
Those cases are mostly related with the crime of
fraud during the fulfillment of contractual
obligations and auditors have revealed those
cases through physical observations during site
visits.
Moreover, in some cases, auditors could ask for
the assistance of expert witnesses and experts to
get a better view of the situation in accordance
with the provisions of the Law on the TCA.
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Our SAI does not issue a special audit report
but the corrupt activities and transactions
encountered and/or detected will be
incorporated in the regular audit report.
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Entity’s management
Legislative body
Furthermore, judicial reports (writs) of the
TCA are also delivered to the Ministry of
Finance for administrations within the scope
of the general budget so that the Ministry can
implement the writs in accordance with
provisions of the laws in force.
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Criminal prosecution (When cases are sent to the
office of public prosecutor for necessary actions to
be taken)
Administrative sanctions (When cases are sent to
the responsible officials’ public administrations for
necessary actions to be taken)
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In financial audits;
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In compliance audits;
◦ audit teams conduct follow-ups of previous years’ audit results so as
to ensure the appropriate implementation of audit findings.
◦ The judicial reports (writs) of the TCA are also delivered to the
Ministry of Finance for administrations within the scope of the general
budget so that the Ministry can execute the writs in accordance with
provisions of the laws in force.
◦ Furthermore, all audit teams are obliged to control the execution of
the writs of the TCA and take it into account in their report if the writs
of previous years are not executed.
◦ Finally, the TCA has the power to initiate financial, administrative and
judicial sanctions to the public officials who do not follow up the
execution and fulfill the requirements of the writs of the TCA. To
illustrate, those public officials who do not fulfill the requirements
written in the judicial report shall subject to salary cut off by relevant
public administrations upon the demand of Turkish Court of
Accounts.
1.
2.
Preventive actions by providing
recommendations to improve entity’s anticorruption and internal control system and
sharing best practices and benchmarking
information to assist decision-makers
Detective actions through the conduct of
fraud/forensic audits [through regularity
audits] and timely reporting of the audit
results to the Prosecution Department
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( x ) Good:
◦ The New Law on the TCA which broadened the audit mandate of
the Court and introduced regularity audit
◦ The recent changes in the audit methodologies and introduction
of data analysis, accounting, internal control systems, risk
assessments, use of information systems in the financial
workflows.
◦ The TCA has been considered successful in public opinion in
preventing and detecting the cases of corruption: Approximately
30 suspicious cases of corruption
◦ New focuses: Improving strategic approach and methodology to
better fight with corruption by preparing its anti-corruption
strategy, anti-corruption (fraud) manual etc.
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None
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No
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( x ) Integrity awareness
( x ) Vulnerability / risk analysis
Compliance approach (rules and regulations,
organizational structure, standards, internal
controls etc.) Focus on preventing integrity
violations/ Repression/Reactive
Integrity approach (culture, integrity awareness,
management attitude etc.) - Focus on facilitating
good behavior /Prevention/Pro-active
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None
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Some superiors cover up for their
subordinates
Other (Please specify)
◦ Due to the nature of supreme audit function the
extent of audit evidence gathered by the auditors is
not sufficient to discover some cases of corruption.
◦ Lack of a full-fledged cooperation and
communication between the TCA and law
enforcement agencies
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This question is not applicable to the TCA as
we do not perform fraud audits.
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The TCA is considered as the most indispensable
actor in the implementation and betterment of
the new public financial management and control
system of Turkey which is in accordance with
international standards and best practices.
The most invaluable contribution of our SAI to
good governance is to ensure the accountability
and transparency with sound financial
management in public sector through their
auditing, reporting and judicial functions.
The TCA sends its audit reports to the Turkish
Grand National Assembly and publishes them on
its website.
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Yes The TCA has eagerly participated several
international projects, workshops and
trainings organized in the field of anticorruption by UN, INTOSAI, ASOSAI or other
SAIs.
In addition to this, the TCA has contributed to
the initiatives for good governance,
transparency and accountability organized by
GRECO in Turkey.
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( x ) Yes
Thanks to the “National Anti-corruption
Strategy of Turkey” officially approved by the
Council of Ministers in 2010 and published in
the Official Gazette, the collaboration among
all public institutions including the TCA with
responsibilities in this field has significantly
enhanced in accordance with an action plan.
Musa KAYRAK
Senior Auditor, CISA