TALLINN, 28 January 2005 - In auditing the economic activities of the Eesti Draamateater Foundation, the State Audit Office (SAO) found multiple financial infringements, disregard for the procedure governing the use of funds, misrule and extra weak control.
Accounting records in the Foundation do not provide complete and true information about all expenses, neither does the deficient internal control structure. In accounting for operating costs, the provisions of the Accounting Act, the generally accepted accounting principles and the internal accounting rules of the theatre have not been followed. In some cases the payment of bonuses was not sufficiently substantiated, and accounting for vacation leave cost did not conform to the established procedure.
Accounting for fixed and current assets in a comprehensive and proper manner was not ensured: part of fixed assets had not been recorded in the books, fixed assets contained items that were actually non-existent; the movement of cash had not been properly recorded in several cases, stock checks were not performed according to the established rules. For instance the list of fixed assets included pieces of art which were lost, but did not include pieces of art that were in exposition or in storage.
In the course of control it appeared that in several occasions advance payments for operating costs were made to people employed by the theatre or even to those not employed, thus being not entitled to such payment. Further, at the end of the accounting period the unused advance funds were not always returned to the cashier as required by internal rules. In several cases breaches of tax laws were discovered.
There was no procedure to govern the operation of Piletipunkt (Ticket Centre), a structural unit of the Foundation dealing with online cross-selling of tickets. The process of the transactions of Piletipunkt is difficult to monitor and does not ensure that the invoices and reports forwarded to the Foundation by the resellers in the sales process would include all ticket revenues.
On many occasions the transactions in the Kaubamaja sales office of Piletipunkt were effected in cash, and because of the virtually inexistent internal control it became possible that cash disbursements were made to the producers of concerts and performances before the revenue from the sale of tickets was collected; there were also occasions when more money was paid out than received from the sale of tickets. Shortages occurred in the sales offices of Piletipunkt, which were sought to be concealed by printed-out though unsold tickets.
Such a situation could emerge only because the Foundation did not have an idea of all economic transactions made in Piletipunkt or control over these transactions. During the audit in the middle of last November, the Member of the Board of the Foundation filed an application with the Central Tallinn Police Station to request investigation of an illegal cash disbursement of EEK 110,000 at the Kaubamaja office of Piletipunkt.
Toomas Mattson
Communication Manager of National Audit Office
Telephone: 6400 777
Mob: 51 34900
E-mail: [email protected]
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Posted:
1/28/2005 12:00 AM
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Last Update:
9/22/2015 10:30 AM
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Last Review:
9/22/2015 10:30 AM