National Assembly of the Republic of Serbia / Activities / Activity details
Thursday, 5 April 2018
41st Sitting of the Committee on Finance, State Budget and Control of Public Spending
At the sitting held on 5 April, the members of the Committee on Finance, State Budget and Control of Public Spending reviewed the State Audit Institution 2017 Activity Report, presented by the President of the State Audit Institution (DRI) and State Auditor General Radoslav Sretenovic.
Sretenovic presented the execution of the State Audit Institution activity plan in the reporting period, realization of the financial plan, activity of the DRI Council, and highlighted the Institution’s recommendations for amendments to the existing and adoption of new audit-related regulations. He said that 2017 marked 10 years of the Institution’s operation in the course of which the organization had undergone some changes related to the HR development strategy and audit quality control, project for which the DRI was accredited in 2016.
The DRI President said that in 2017 the Institution had conducted regulatory and performance audits. Out of the 376 audit reports, 201 were audits of financial reports, 2 were performance audits and 156 post-auditing reports. Sretenovic added that the auditing covered, among other things, 11 direct and 15 indirect budgetary beneficiaries, 32 local self-governments, four compulsory social insurance organizations, 14 health insurance organisations, 39 public enterprises, the National Bank of Serbia – public spending, four public agencies and four political parties. For the 201 financial report audits the DRI gave 19 positive assessments of financial reports, 173 financial report assessments with reservation, 169 assessments with reservation, seven negative financial report assessments and 11 negative regulatory audit assessments, said Sretenovic.
He said that the financial report and regulatory audits covered data on 2,472 billion RSD in income and 3,400 billion RSD in expenses. The sum total of irregularities and errors amounted to 734 billion RSD and their structure related to the preparatory activity for the collation of the reports, faulty data representation and operation irregularities. According to data 76.53% of the auditees failed to establish adequate internal control and expressed employee expenses erroneously in the amount of 300 million RSD. The auditees also had irregularities in abiding by the regulations limiting public sector employment and did not apply the 10% base salary reduction, said Sretenovic. Speaking of public procurement, in 73 auditees public procurement had not been conducted in line with the law which amounts to 2.36 billion RSD or 7.41% of funds audited.
DRI issued 2,605 recommendations to auditees, 35 in performance audits and 2,5760 in regulatory audits, with 30 to 90-day deadline to eliminate the flaws perceived, said Sretenovic. He added that most of the recommendations concerned expenditure. In the course of 2017 and in 2018 due to suspected violations, the DRI also filed 512 charges related to 2016 and 2017, asking for a misdemeanour charge on 428 of the cases, commercial charges for 22 and 52 criminal charges against 54 responsible parties, the DRI President concluded.
In the course of the audits, the auditees implemented 570 activities to eliminate the detected flaws and the state bodies adopted the recommendations for amendments to the existing and adoption of new regulations viz. five laws and two rulebooks. In the reporting period DRI gave recommendations for the adoption of new regulations viz. 145 laws, four ordinances, six rulebooks and one decision, and executed all the planned tasks and activities for 2017, the DRI President concluded.
In the course of the debate, the Committee members commended the Committee’s cooperation with the DRI in the past years, especially in the part concerning the performance audits of public spending, while the DRI President, in view of the fact that his mandate is ending, thanked the National Assembly, Committee on Finance, State Budget and Control of Public Spending and the Subcommittee for the Consideration of Reports on Audits Conducted by the State Audit Institution for their cooperation, and wished that the new DRI Council members and President maintain the continuity of said cooperation and improve the operation of the DRI.
The Committee Conclusion Proposal with the State Audit Institution 2017 Activity Report will be adopted at one of the coming Committee sittings and forwarded to the National Assembly for consideration.
The sitting was chaired by Committee Chairperson Dr Aleksandra Tomic.
The sitting was attended by the following Committee members and deputy members: Srbislav Filipovic, Olivera Pesic, Djordje Milicevic, Goran Kovacevic, Zoltan Pek, Dr Milorad Mijatovic, Zoran Bojanic, Veroljub Arsic, Djordje Kosanic, Momo Colakovic, Sonja Vlahovic and Goran Ciric.
The DRI President said that in 2017 the Institution had conducted regulatory and performance audits. Out of the 376 audit reports, 201 were audits of financial reports, 2 were performance audits and 156 post-auditing reports. Sretenovic added that the auditing covered, among other things, 11 direct and 15 indirect budgetary beneficiaries, 32 local self-governments, four compulsory social insurance organizations, 14 health insurance organisations, 39 public enterprises, the National Bank of Serbia – public spending, four public agencies and four political parties. For the 201 financial report audits the DRI gave 19 positive assessments of financial reports, 173 financial report assessments with reservation, 169 assessments with reservation, seven negative financial report assessments and 11 negative regulatory audit assessments, said Sretenovic.
He said that the financial report and regulatory audits covered data on 2,472 billion RSD in income and 3,400 billion RSD in expenses. The sum total of irregularities and errors amounted to 734 billion RSD and their structure related to the preparatory activity for the collation of the reports, faulty data representation and operation irregularities. According to data 76.53% of the auditees failed to establish adequate internal control and expressed employee expenses erroneously in the amount of 300 million RSD. The auditees also had irregularities in abiding by the regulations limiting public sector employment and did not apply the 10% base salary reduction, said Sretenovic. Speaking of public procurement, in 73 auditees public procurement had not been conducted in line with the law which amounts to 2.36 billion RSD or 7.41% of funds audited.
DRI issued 2,605 recommendations to auditees, 35 in performance audits and 2,5760 in regulatory audits, with 30 to 90-day deadline to eliminate the flaws perceived, said Sretenovic. He added that most of the recommendations concerned expenditure. In the course of 2017 and in 2018 due to suspected violations, the DRI also filed 512 charges related to 2016 and 2017, asking for a misdemeanour charge on 428 of the cases, commercial charges for 22 and 52 criminal charges against 54 responsible parties, the DRI President concluded.
In the course of the audits, the auditees implemented 570 activities to eliminate the detected flaws and the state bodies adopted the recommendations for amendments to the existing and adoption of new regulations viz. five laws and two rulebooks. In the reporting period DRI gave recommendations for the adoption of new regulations viz. 145 laws, four ordinances, six rulebooks and one decision, and executed all the planned tasks and activities for 2017, the DRI President concluded.
In the course of the debate, the Committee members commended the Committee’s cooperation with the DRI in the past years, especially in the part concerning the performance audits of public spending, while the DRI President, in view of the fact that his mandate is ending, thanked the National Assembly, Committee on Finance, State Budget and Control of Public Spending and the Subcommittee for the Consideration of Reports on Audits Conducted by the State Audit Institution for their cooperation, and wished that the new DRI Council members and President maintain the continuity of said cooperation and improve the operation of the DRI.
The Committee Conclusion Proposal with the State Audit Institution 2017 Activity Report will be adopted at one of the coming Committee sittings and forwarded to the National Assembly for consideration.
The sitting was chaired by Committee Chairperson Dr Aleksandra Tomic.
The sitting was attended by the following Committee members and deputy members: Srbislav Filipovic, Olivera Pesic, Djordje Milicevic, Goran Kovacevic, Zoltan Pek, Dr Milorad Mijatovic, Zoran Bojanic, Veroljub Arsic, Djordje Kosanic, Momo Colakovic, Sonja Vlahovic and Goran Ciric.
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