GEO

Chamber of Control publishes some key audit results

03 February, 2011

Georgia's supreme audit institution has published its findings and follow-up actions on 25 cases. However, no information is published online on most of the Chambers’ audits of state entities. it still remains very difficult to assess the impact of the Chamber’s work, as neither government nor parliament publish updates on how they follow up to the recommendations. TI Georgia welcomes that the Chamber of Control of Georgia (CCG), the country’s supreme audit institution, recently released a list of 25 binding audit statements and of the actions undertaken in response to these statements. It is the first time the Chamber has released these documents, following our recent recommendation to do so. We applaud the CCG's openness to these suggestions and hope that other government institutions will follow the example by making more information about their activities publicly available online. The audit statements cover a number of state-owned companies, government entities ("legal entities of public law”) and autonomous self-government institutions. In our opinion, their release is an important step to improve the transparency of Georgia's state budget and the government’s accountability. When the CCG issues an audit statement, the recipient is obliged to report back to the Chamber within one month and report on the follow-up actions taken in response to the audit. The supreme auditor also often makes recommendations to audited entities, advising them to fix systematic problems or specific shortcomings. There is still room for further improvement, as it remains difficult to trace what impact these recommendations have and how parliament and other government entities follow up on these propositions. The 25 publicly accessible audit statements are only one specific category of audit report issued by the CCG, constituting a fairly small part of its work. The Chamber undertook 243 audits in 2009 and 303 in 2008. Aggregate statistics on the Chamber’s 2010 work are not available yet. According to its 2009 annual report, the CCG revealed about 1,195 cases of violation of legislation. Twenty-three cases of suspected criminal offense were reported to law enforcement bodies as a result of its audits. The annual report also lists a set of concrete examples of the most common problems its auditors have detected: non-fulfillment of financial terms of agreements, missing documents certifying expenditure, improper management and inefficient or purposeless spending. If conclusions, findings and recommendations of all the CCG’s audits were made available online, it would allow the media, watchdog organizations, stakeholders and an interested public to contribute to a better functioning state and more efficient public spending. The work of the CCG is crucial for ensuring transparency and accountability of the implementation of the state budget. However, the Chamber’s work will only have a strong impact if its findings are adequately addressed and if the case-specific and systemic weaknesses that the state’s auditors identify are duly remedied. This is mainly the responsibility of the executive and, to some extent, of parliament. In the Georgia country report of the Open Budget Survey 2010, we found that the absence of information about executive follow-up to audit findings is one of the weaknesses of Georgia’s budgeting system. Neither the government nor parliament produce overviews of the actions taken in response to audit recommendations. While current legislation does not establish such an obligation, such reports by the institutions audited would allow outsiders to understand the steps the government takes to protect public finances. In addition, while the Chamber is responsive to Freedom of Information requests, there is no way for citizens to know what audits it undertook in a given year and therefore much information that is technically in the public realm is never made public. A simple list of audits, including the type of audit, could be annexed to the CCG’s annual report and regularly updated on its website. The 2009 annual report and the CCG’s recent release of the follow-up on audit statements are important steps towards greater transparency and accountability of the public sector. We therefore hope to see further positive developments in the near future, including the two recommendations above.

Author: Mariam Khotenasvhili and TI Georgia staff