There is a need to strengthen the Accounts Chamber

Baku/13.04.21/Turan: The report "On the activities of the Accounts Chamber of the Republic of Azerbaijan in 2020" presented to the Milli Mejlis,  noted that 452 deficiencies were identified by state structures last year. According to the document, in 2020 there were cases of misuse of funds amounting 83.3 million manat.

The total amount of violations in 2020 amounted to 130.3 million manats, of which 51.9 million manats were recovered, 3.3 million manats are to be restored for the current year, and materials on violations totaling 16.4 million manats were transferred to law enforcement agencies failed to recover 58.7 million manats.

I wonder if the Accounts Chamber will be able to identify all violations. Are those who commit these violations punished?

According to the Accounts Chamber, despite the impact of the coronavirus on financial control in 2020, the scope of the organization's financial control measures over public funds has expanded. “The volume of control activities carried out in 2020 was large compared to 2019, both in terms of quantity and sources. In the reporting year, control measures carried out in the form of an audit covered funds totaling 9,279.1 million manats, a significant part of which fell in 2019,” the Chamber said.

During this period, the legislative activity of the Chamber was carried out in a timely and efficient manner, as soon as possible, drafts of the state budget and extra-budgetary state funds, amendments to the relevant budgets, conclusions of the Accounts Chamber on the execution of the state budget were prepared.

The department noted that last year, control measures covered to a greater extent the agricultural sector, public procurement, analysis of financial statements, as well as the areas of planning and budget execution, accountability of the State Financial Markets Service.

“Only a quarter of the producers who applied for subsidies were provided with an extract on the ownership of land, 33.7 percent of the cultivated land were left without state support. There was a shortage of personnel specializing in accounting and an influx of qualified personnel into the private sector,” its representative said.

The audits conducted during the year revealed incorrect reporting for AZN 412.4 million. The amount due for non-compliance with accounting principles and misrepresentation of accounting records totals 335.4 million manat. As a result of 34 audits completed in 2020, deficiencies were identified in 452 cases. In the reporting year, a total of 130.3 million manat was executed in violation of legal acts on the specified classification of deficiencies.

In the international rating reports of the open budget index published in 2020, the activities of the Accounts Chamber were evaluated at 89 points. "This is the 3rd highest among 117 countries assessed."

The department noted that, as in previous years, the necessary disciplinary measures are not applied to officials who have made shortcomings in the legal, effective, economical use of public funds. Notes are of a cautionary nature.

“In our opinion, the risk that these persons will continue to fulfill their duties and in the future will admit characteristic shortcomings in this direction is significant,” he said.

Member of the Milli Mejlis Committee on Economic Policy, Industry and Entrepreneurship Rufat Guliyev told Turan that the report of the Accounting Chamber does not cover the financial shortcomings made by state bodies.

"The fact is that there are only 15-16 employees in the Chamber, who find it difficult to check reports for 100 million manats, and even one billion manats with limited forces. That is, it is impossible to check the entire budget. It has its own system, and checks are carried out according to this system. In my opinion, it would be better to broaden the scope of checks,” Guliyev said.

The deputy noted that the Accounts Chamber itself could not punish officials who made mistakes. "The department is forcing officials to return to the budget funds spent on corruption schemes. In most cases, the chamber can achieve this," he said. According to the committee member, small mistakes are not a big warning. “We have thousands of transparent and honest employees. But if there is any negative scheme in any state body, law enforcement agencies should punish the officials who committed violations,” he said.

Guliyev noted that this is about the state budget. “This is the money of the people. This is money received from taxes, customs, transfers sent by the state. How can this money be appropriated? This issue needs to be seriously addressed. They should not think that they would be free to repay the money they have embezzled. They must be brought to justice.

We also asked the Chairman of the Accounts Chamber Vugar Gulmammadov to once again provide us with information on whether the cases of those who committed violations are being investigated in courts and what measures were taken against them,” he said.

The MP stressed that the anti-corruption process in Azerbaijan has received a great impetus, is developing, and this struggle will continue. “If an official, regardless of position or status, does not follow the instructions of the President and does not work transparently, the most powerful financial audit tool that can best deal with them is the Accounts Chamber,” Guliyev said.

Economist Rovshan Agayev told Radio Azadlig that the report of the Accounts Chamber can be considered reliable, and as for financial violations, the audit results were presented to law enforcement agencies.

"But the question of what punishments await those who committed financial violations no longer falls within the competence of the Accounts Chamber. Legislatively, the Accounts Chamber is completing work on identifying financial violations. Whether or not to impose punishment on those who committed financial violations is the prerogative of the executive authorities, law enforcement agencies,” he said.

The expert noted that although there were arrests for corruption in Azerbaijan at different times, some people were released ahead of schedule. “If the country had a normal, open to society, results-based reporting system, these violations would never even reach the reporting stage. Corruption can occur in any country, it is important to have control mechanisms and an accountability system to prevent corruption, efficient use of funds,” the expert said.

Agayev stressed that the Accounts Chamber can conduct performance audits along with financial audits and compliance audits. "Performance audit allows the Accounts Chamber to assess what results were achieved in spending funds. Maybe the Accounts Chamber conducted such an audit, but we did not find information about it in open sources," he said.

The expert believes that the Accounting Chamber, as a body subordinate to the Milli Mejlis, can make a report more than once a year, but hold hearings in parliamentary committees, inform deputies about the results of the audit.

"Such activities can also increase the responsibility of the heads of the audited enterprises and organizations. Thus, they will know that the results of audits will not have feedback, and members of parliament will know about it," he said.

According to Agayev, the occurrence of financial irregularities is also associated with gaps in the legislation related to procurement.

“In this area, legislation should be improved; a mechanism has to be developed to exclude corruption risks. There is currently no effective mechanism to address this risk. Therefore, here the activity of the structure exercising state control over purchases must be effective,” the expert said. He noted that the budget of Azerbaijan has an investment purpose.

“Every third manat of the budget is intended for investments. Since 2017, conditions have developed that it is almost impossible to obtain information about investment projects. Budgetary accountability, transparency, openness are very burdensome. We cannot see how much money was effectively spent," Agayev said. —0—