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Parliamentary Committee on economy, finance and budget considered the Audit Report of the Final State Budget Account of Montenegro for 2016 and Annual Report of the SAI

Podgorica, 14th November 2017 - The Parliamentary Committee on economy, finance and budget of Montenegro has held 29th session on deliberation of the Proposal Law on the Final State Budget Account of Montenegro for 2016. During this session, it has considered the Audit report of the Final State budget account of Montenegro with the Annual Report on performed audits and activities of the State audit institution for October 2016 – October 2017.  President of Senate, PhD Milan Dabović and members of Senate, Nikola N. Kovačević, Zoran Jelić and PhD Branislav Radulović have participated at this session.

President of the Senate of the SAI has informed the members of the Committee that the SAI performed the Audit of the Proposal Law on the Final Statement of Accounts of the State Budget of Montenegro for 2016 and expressed unqualified audit opinion with emphasis of matter on the financial audit and qualified opinion on regularity audit. It gave 16 recommendations. The regularity audit has identified certain materially significant deviations and non-compliances of the business activities of the spending units with the laws and sub-legal acts. On this occasion, president of the Senate has pointed out the most important irregularities which led to expressing qualified audit opinion on regularity audit of the Proposal Law on the Final Statement of Accounts of the State Budget of Montenegro for 2016.

The Committee has also considered the Annual Report on performed audits and activities of the State audit institution for October 2016 – October 2017, especially the part related to: report on assessment of the implementation of the fiscal responsibility criteria, reports on conducted individual audits for the given period, as well as other activities of the State audit institution.

Apart from the audit of the Proposal Law on the Final State Budget Account of Montenegro for 2016, the State audit institution carried out, in the reporting period 41 individual audits as follows: 14 individual reports on financial audits and regularity audits; 4 performance audit reports; 1 IT audit report; 13 audit reports on consolidated annual financial statements of the political parties for 2016; and 9 audit reports on consolidated annual financial statements of the political parties for 2015, which had not been covered in the last year's Annual Report of the SAI.

In performed individual financial audits and regularity audits, the State audit institution of Montenegro gave 10 unqualified, 11 qualified and 4 adverse and 270 audit recommendations, while the SAI gave 100 recommendations for 4 performance audits and 14 recommendations for audit of information system of the Health insurance fund.

With regards to the audits of annual financial statements of 13 political entities for 2016, the SAI gave 16 unqualified, 9 qualified and 1 adverse and 69 audit recommendations. For the audits of the annual financial statements of 9 political parties, the SAI gave 73 audit recommendations and 6 unqualified, 7 qualified, 3 adverse and 2 disclaimer of opinion.

The SAI has prepared the Report on assessment of the application of the fiscal accountability criteria in 2016 and assessed the development of the relevant fiscal documents in line with the legal obligation, as well as realization of the criteria determined in the Law on Budget and Fiscal Responsibility. With regards to the activities on development of the relevant documents, the Government fulfilled its activities in line with the legal obligations. The criteria related to the share of the public debt and cash deficit in GDP, as well as the requirement to plan and realize the surplus of the budget were not accomplished. The indicators related to the obligation of planning and execution of the expenditures in a manner that the current expenditures and transfers should be lower than the current revenues and donations were implemented. As for the implementation of static indicators, two out of eight envisaged indicators were implemented, while four out of six analyzed indicators were accomplished.

In addition to this, the Annual Report also contains an overview of the implementation of the Parliament's conclusions regarding the adoption of the Law on Final Statement of Accounts of the Budget of Montenegro for 2015.