compliance audit report on the budget year
and managing state assets in the local public authorities
mun. Balti 2014
in the Official Gazette
Article No. 7
Court, in the presence of Deputy Mayor Balti Mr Leonid Babii, Head of public property administration of the Public Property Agency Mikhail Doruc, head of the State Tax Inspectorate Balti Mr Anatoly Panţîr, deputy head of the State Tax Inspectorate Tatiana tares in Balti, Balti cadastral office chief Mr Andrei CHETRARI, head of the General Directorate financial and economic Mrs Vera Rusu, Head of Directorate for social assistance and family protection Ms Veronica Munteanu, deputy head of the Directorate municipal property and land relations Mr Andrei Popa , administrator of the municipal enterprise "Water Canal Balti" Mr. Victor Grebe, manager municipal Enterprise "Directorate sole limited partner capital construction" Mrs. Larisa Bragari, administrator of the municipal enterprise "household housing" Tatiana Parascan, guided by art. 2 ( 1) and Article 4 para. (1), letter a) of Law No 261-XVI Court of 05.12.20081, examined the budget year compliance audit report and management of public assets in local authority in the municipality. Balti 2014. _____________________________________
1Legea Court No 261-XVI of 05.12.2008 (hereinafter - the Law No 261-XVI from 05.12.2008).
Audit mission was carried out under article 28, article 30 and article 31 of Law No 261-XVI from 05.12.2008 and in accordance with the program of audit work of the Court of Accounts for the year 20152, with to verify compliance by local government authorities (hereinafter - AAPL) in Balti of normative acts in the budget process; compliance of normative and methodological framework for assessing, planning and administration of taxes / local taxes and substantiation, allocation and reporting of budgetary expenditure; administration and integrity of public property.
______________________________________ 2Hotărîrea Court No. 57 of 08.12.2014 "On approval of the Programme of audit work of the Court of Auditors for 2015".
The audit was conducted in accordance with international auditing standards extern3 public, normative and methodological framework applicable institutional framework. Audit evidence was obtained by examining reports on budget execution, financial statements of the audited entities, accounting records; verification of source documents; analysis of indicators and data reporting incidental; direct observation and by analyzing the reasons people in positions of responsibility in the audited entities. The Mission also verified audit provisions mayor and local council decisions. _______________________________________
3Hotărîrea Court No. 60 of 12.11.2013 "On the application of international auditing standards of the Supreme Audit Institutions Level 3 - ISSAI 100, ISSAI 400, in the audit of the Court of Accounts".
Having heard the report and presented the audit results and explanations of the persons officials present at the public hearing, the Court
public audit certifies certain positive trends in the management of public funds, and especially quantify the institutional weaknesses generating irregularities and inefficiency. Thus, the local government has taken no preset goals to broaden the tax base related to strengthening local budgets in order to achieve sustainable economic and social interests of the territory administered. How to manage spending and public property does not meet the criteria of prudence and economy. In this context, the audit reveals the following.
• In the period under audit, AAPL did not identify and did not assess specific and overall economic potential, respectively, did not provide substantiating the fair value of the tax base, including estimating and forecasting fiscal relevant indices, for ensuring the sustainability of local finances. Failure to implement analytical tools and methodological framework determined deficiencies of taxes undervalued generating budgetary revenues. This situation reveals inappropriate and dysfunctional systems in monitoring of objects and subjects of taxation, especially the wage bill as a whole, the real estate fund and fees administered directly by AAPL. Consequently, failure to identify deficiencies have resulted in the formation calculation basis the revenues of local budgets totaling 26.7 million (income taxes - 4.9 mln; property taxes - 0.3 million. lei, other property income - 1.5 mln; local taxes - 9.2 mln, revenues from special means - 7.2 mln, revenues from the management of public land and property - 3.6 mln ). Neconlucrarea of the relevant authorities (financial, economic, fiscal, statistical and land), not assuming plenary that the institutions of key objectives to quantify the budgetary revenues caused systemic weaknesses evident in inventory and (re) authentic assessment of taxable overall and per category of tax payments / non-tax public external audit assesses uncalculated and uncollected revenues to the local budget of about 8.5 million.
• Management of costs and legal claims not meeting the requirements, thus allowing for a series of omissions and irregularities that have diminished the effectiveness of allocations and collection of receivables. The result of audit assessments is limited to elucidate the many exemptions in the estimated overall management of the appropriations in the amount of 114.0 mln, including 37.4 mln - current 76.6 mln - capitals.
• Management System AAPL, given the lack of regulatory framework for the management of local public assets, did not provide regularity and legality of public property administration, and a consequent process:
√ failure statutory rights record immovable property worth 382.8 mln and rights of use - by 134.5 million lei;
√ not reflect in the accounts of the patrimonial goods totaling 14.4 mln and receivables in the amount of 3.4 mln;
√ improper reporting out heritage (wear) worth 19.7 million lei;
√ inefficient work of municipal administration (24.7 million).
• checks on compliance with the requirements and recommendations of previous audit by the Court reveals that AAPL persevered in Balti not necessary fixes. Thus, the 21 recommendations outlined in previous Court Decision no.36 of 04.07.20134, 11 were partially implemented. _______________________________
4Hotărîrea Court No. 36 of 07.04.2013 on the audit report and management of public assets budgets within the Balti local authorities in 2011-2012.
Court Plenum summarize by reiterating that the irregularities recorded shows a number of causes-effects, including makers irresponsibility, and lack of internal controls relevant.
Based on the above, under Article 7 para. (1) a), art. 15 (2) and para. (4), Article 16 c) and Article 34 paragraph . (3) of Law No 261-XVI from 05.12.2008, the Court
1. Compliance audit report is approved in budget and public assets management within local authorities in Balti in 2014, attached to this Decision.
2. This Decision and audit report shall be submitted:
2.1. Balti Balti municipal council and mayor, to implement the recommendations given in the audit report, to determine concrete actions to eliminate the deficiencies found and the setting of deadlines and persons responsible for their implementation;
2.2. State Tax Inspectorate for information and asked the State Tax Inspectorate Balti implementation of standardized profile related to the management and administration of taxable evasion / tax arrears, the voluntary compliance of taxpayers and ensure institutional interaction with local government;
2.3. Ministry of Finance for information and making work attitude and cooperation on financial and fiscal authorities in Balti in the fiscal projections and collection of taxes;
2.4. Balti Territorial Office of the State Chancellery, the information and take the attitude to exercise the administrative activity AAPL suitable legal framework;
2.5. Government information and compliance relevant central government and local authorities on compliance with legal and regulatory framework in record / cadastre / integrity of public assets managed;
2.6. Prosecutor General's Office for documentation and possible own initiative;
2.7. Moldovan parliament and standing committees: economy, budget and finance; public administration, regional development, environment and climate change, for information.
March. It notes that during UAT deployment audit, certain deficiencies were corrected: the town hall records mun. Balti project expenditures were recorded in the amount of 111.7 thousand lei; the balance sheet accounts - royalty revenues amounting to 2.5 mln; AAPL has been recorded in the balance sheet value of financial liabilities of 0.8 mln; a trader has conducted tax recalculation market (8.8 thousand); 8 businesses have authorized trade activity.
4. Given the claim in the audit report annexed to this Decision, the recommendations of previous missions external audit is excluded from the monitoring regime Court Decision No. 36 of 04.07.2013 on the audit report and management of public assets budgets within public authorities local Balti in 2011-2012.
May. About the measures taken for the execution of subparagraph 2.1. of this Decision will inform the Court within 12 months from its publication in the Official Gazette of the Republic of Moldova.
June. This Decision shall be published in the Official Gazette of the Republic of Moldova in accordance with article 34 par. (7) of Law No 261-XVI Court of 05.12.2008.