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Published Audit Report on the Ministry of education – Preschool Education Programme

Podgorica, 12th October 2015 – The State audit institution performed financial audit and regularity audit of the Ministry of education, Preschool Education Programme. 

The audited entities subject to audit were as follows: Ministry of Education ‐ Preschool Education Programme; PPI “Đina Vrbica“, Podgorica; PPI “Ljubica Popović“, Podgorica; PPI “Zagorka Ivanović“, Cetinje; PPI “Dragan Kovačević“, Nikšić and PPI “Irena Radović“, Danilovgrad.

Subject of audit are the expenses under the Preschool education programme and Annual financial statements for 2014 and regularity of the operations of public pre‐school institutions, which are funded by resources allocated for the Preschool Education Programme of the Ministry of Education.

Based on the conducted audit and established facts, upon the consideration of the audited entity's statements included in the audited entity's Response to the SAI Preliminary Audit Report, the competent Auditing Board of the SAI, consisting of Mr. Branislav Radulović, PhD (member of the Senate – Head of Auditing Board) and Milan Dabović, PhD (President of the Senate – member of the Auditing Board), expressed qualified audit opinions regarding the financial statements for 2014 and compliance of the business operation with the regulations of the audited public pre-school institutes.

Financial statements of the audited public pre-school institutes for 2014 give a true and fair view of recorded receipts and expenditures in accordance with accepted financial reporting framework, except for the effects which issues specified in the recommendations might have on the financial statement.

Business activities and operations of the audited entity PPI "Ljubica Popović", PPI „Đina Vrbica“, PPI “Dragan Kovačević” in 2014 were in all material respects in compliance with the current legislation, except for non‐compliance with the General Law on Education, Rulebook on Unique Classification of Accounts for the State Budget, State Funds and Municipal Budgets and the Public Procurement Law.

Business activities and operations of the audited entity PPI “Zagorka Ivanović” and PPI “Irena Radović” in 2014 were in all material respects in compliance with the current legislation, except for stated non‐compliance with the Rulebook on Unique Classification of Accounts for the State Budget, State Funds and Municipal Budgets and the Public Procurement Law.

Given the fact that given audit covered the control of expenditures of the Pre-school programme within the Ministry of education, the State audit institution proposes to the Ministry of education to make a refund in the amount of € 500,000.00, to the Institutions which it borrowed the funds from, in accordance with the possibilities.

When paying expenses on behalf of the institutions, the Ministry of Education should provide data based on which it would be possible to identify the exact amount of paid expenditures per institution, so that the institutions will be able to disclose the said data in the Cash Flow Statement IV, in accordance with the International Public Sector Accounting Standard ‐ Financial Reporting Under the Cash Basis of Accounting.

Article 35 of the Law on Preschool Education stipulates that parents shall pay for nutrition costs for children, while Article 7 of the General Law on Education prescribes that the activity of a public institution is of non‐profitable nature.

Based on the above facts, the State Audit Institution recommends to the Steering Committees and the Ministry of Education to reconsider the justification of the stipulated level of costs for children's nutrition, which amount to € 39.00, or € 40.00 per month.

The Ministry of Education is required to provide budget appropriations for the public preschool institutions, in accordance with Article 136 of the General Law on Education and Regulations on norms and standards for acquiring resources from public revenues for institutions that implement publicly valid educational programmes.

The final Audit Report on the Ministry of education – Preschool Education Programme has been officially published at the web site of the State audit institution of Montenegro.

Excerpt from the Audit Report of the Ministry of Education – Preschool Education Programme

Audit Report of the Ministry of Education – Preschool Education Programme (mne)