Court of Accounts
Republic of Moldova
The Court of Accounts (CoA) examined the Report on the audit of consolidated statements of the State Chancellery as on 31st December 2017 at the public meeting on December 12th 2018.
The State Chancellery is the public authority that organizes the activity of the Government in order to accomplish the internal and external state policy, the creation of the general framework for defining the priorities of the Government activity, the methodological and organizational support for the system of planning, elaboration and implementation of the policies by governmental authorities, monitoring of the implementation of the governance program, presentation of analytical and informational materials, preparation of draft Government acts, including the right to legislative initiative and verification of their execution, as well as the exercise by the Government of the prerogatives of its relations with the local public administration authorities.
The audit mission aimed to test, in all material respects, whether the State Chancellery consolidated financial statements as on December 31st 2017 presented a correct and fair view in accordance with the applicable financial reporting framework and, as a whole, do not contain significant distortions.
As of December 31st 2017, the functioning of the State Chancellery was ensured by the Central Office, 10 territorial offices and 6 public institutions. At the same time, the State Chancellery monitored the activity of 7 state-owned enterprises, having the status of founder. Subdivisions operated on the basis of their own regulations, approved by the Secretary General of the Government.
The financing of the activity of the State Chancellery is made from the state budget allocations and other revenues obtained in 2017 amounting to 334.5 million MDL. Thus, the financing from the state budget amounted to 263.8 million MDL, representing 78.9% of the total administered revenues. At the same time, 9.0 million MDL were obtained from receipts from the paid services, 58.5 million MDL - obtained from the payment for the lease of public property assets, 2.8 million MDL - received from grants, etc.
As a result of the audit activities carried out, it is revealed that the revenues from the provision of the paid services and the payment for the lease of the public property assets were fully accounted for and presented in the consolidated Statements of the State Chancellery for 2017.
In 2017, the State Chancellery and the subordinated institutions administered non-financial assets worth a total of 587.2 million MDL. In the total assets, the major share goes to fixed assets amounted to 538.8 million MDL or 91.8%, followed by non-productive assets in the amount of 39.7 million MDL.
As a result of the evaluations carried out, the audit evidence shows that the key controls related to the main financial processes are functional, although in some cases they have not fully achieved the objectives, and some audit observations are admitted to the subordinated institutions to the State Chancellery, referring to: (i) the incorrect calculation of the fixed assets' consumption and the non-calculation of the depreciation, (ii) the recording of the fully utilized fixed assets not being re-evaluated, and (iii) the possession of the non-financial assets and stocks of outdated moral circulating materials not used during the last 3 years.
At the same time, the audit evidence indicates that the State Chancellery, on the basis of monthly applications, transfers financial resources to the beneficiaries of subsidies, and under the current regulatory and reporting framework, they are transferred directly to expenses without subsequent monitoring of their actual use. State budget execution report of the State Chancellery reflected cash execution of subsidies, without information on the actual costs of subsidies by their beneficiaries. Thus, a recommendation was submitted to the Ministry of Finance with a view to completing the normative framework with provisions regarding the reporting of the actual execution of the subsidies and determining the situation of unused balances by the beneficiaries.
Audit evidence obtained in the audit engagement was sufficient and appropriate to provide a basis for expressing an opinion on consolidated financial statements of the State Chancellery on December 31st 2017.
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