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Published Audit Report on Effects of the activities of the Council for Improvement of Business Environment, Structural and Regulatory Reform

Podgorica, 23rd November 2016 – The State audit institution has conducted a regularity audit and audit of the effects of the activities of the Council for Improvement of Business Environment, Structural and Regulatory Reform.

The regularity audit includes checking whether the system of internal controls is established in accordance with determined criteria, while performance audit includes assessment of whether the activities of the Council had any effects on improving the business environment and regulatory and structural reforms.

Based on determined facts and the statement of the audited entity to the Preliminary Statement of the SAI, the competent Auditing Board comprised of a member of the Senate, Branislav Radulović, PhD, Head of the Auditing Board and a member of Senate, Nikola N. Kovačević, a member of the Auditing Board, has stated the following with regards to the activities and effects of the work of the Council:

- During 2016, the Council has not held a single session, which is not in accordance with Article 9 paragraph 1 of the Rules of Procedure of the Council that is "sessions are held as needed, but at least quarterly" and Article 4 of the Rules of Procedure, which regulates the rights, duties and obligations of the members of the Council.

- The Council did not propose to the Government a Plan for improvement of the business environment, regulatory and structural reforms for 2016, although it is a task defined by the Decision on establishment of the Council.

Positioning a temporary working body of the Government - the Council as a spending unit – has as a consequence the following:

- Fees for 13 Council members were paid during the first 3 months during 2016. During 2016, the Council has not held any session (last session held on 24.12.2015.). Out of the budget of the Council for 2016, till completion of the audit, the amount of € 36,347.37 was spent out of planned amount of €43,561.20

- Ministry of Finance, which is responsible for performing administrative and technical tasks for the Council based on the Decision on establishment of the Council, did not draw up and submit annual financial statements.

- The payments were carried out out of the budget of the Council to the employees and civil servants employed in the Ministry of finance and other public administration bodies over the years for performing administrative and technical tasks related to the work of the Council after the decisions of the Ministry of Finance with reference to Article 8 of the Decision on the Establishment of the Council, which does not constitute an appropriate legal basis.

- During 2015, monthly payment of fees (allowances) to the employees and civil servants was executed for performing administrative and technical tasks for the work of the Council, whose number ranged from 13 to 20. Payment of fees (allowances) to the civil servants and employees were carried out during the first 3 months of 2016 based on the decision of the Ministry of Finance and that is, for 33 civil servants and employees from the public administration bodies.

- During the audit, it was not possible to obtain evidence  about specific administrative and professional works performed for the Council for majority of the individuals to whom were paid allowances (fees).

The State Audit Institution recommends to the Government that during budget planning process, it should not plan financing of the Council for improvement of the business environment, structural and regulatory reform as an independent spending budget unit, but that it should plan it as a program within the budget of the Secretariat General of the Government.

The Final Audit Report on Effects of the activities of the Council for Improvement of Business Environment, Structural and Regulatory Reform has been published at the official web site of the State audit institution of Montenegro.

Audit Report on Effects of the Activities of the Council for Improvement of Business Environment, Structural and Regulatory Reform (mne)