TALLINN, 25 August 2004 - The State Audit Office audited the economic activities of Ida-Viru County government and the institutions within its administrative are in 2003, focusing on the legitimacy of economic transactions, organisation of accounting and implementation of internal control systems. The audit resulted in identification of a number of forbidden transactions with assets in restricted commerce; also, numerous omissions were identified in the institutions within the administrative area of the county government, referring to the deficiencies of county governments in organising the accounting and internal control in those institutions.
Ida-Viru County Government has leased the buildings of an institution in its administration area – Aa Retirement Home – to a trading company for the period of ten years. According to t he State Assets Act, the assets leased are state assets in restricted commerce and the list of such assets needs to be approved by the Government of the Republic. This was not done. Additionally, a decision of a Parliament Committee is required for that sort of transactions; Ida-Viru County Government didn’t have the decision.
In his answer to the State Audit Office, the Minister of Finance does not consider the respective transaction to be illegitimate; furthermore, he considers the preparation of the list required in the State Assets Act unnecessary altogether. Nevertheless, the State Audit Office has formed a position that such transactions are illegal as the Parliament in its respective Act has disallowed the use of such assets in commerce. The failure to prepare the list by the Government of the Republic does not regularise such transactions; this only means that the Government has failed to fulfil its obligations.
In addition to the violation of the State Assets Act, the audit resulted in a list of different errors from the violation of Public Procurement Act to omissions in recording of state assets; the total list of such errors in institutions administrated by Ida-Viru County Government totalled to 18 pages. Accounting records of numerous institutions are insufficient and the control measures applied rather weak. Also, the heads of institutions are not sufficiently aware of legal acts and regulations. Essential deficiencies were detected in the recording of fixed assets; therefore, the accounting information does not provide a fair and reliable overview of the assets.
To improve the situation the State Audit Office suggested the County Government to adopt and implement common principle and internal control procedures in the institutions within its administrative area. Also, the County Government should consider the qualification of the accountants of the institutions within its administrative area and the accountants’ suitability for given positions. If necessary, training should be organised to improve qualifications.
Sven Soiver
Press Representative of State Audit Office
Telephone: (372) 640 0787
GSM: (372) 53 414464
E-mail: [email protected]
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Posted:
8/25/2004 12:00 AM
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Last Update:
10/1/2015 10:15 AM
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Last Review:
10/1/2015 10:15 AM