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Audit report on compliance of the allocation of subsidies granted for the firewood sale, examined by the profile Committee

  • 14.02.2024
  • 441

On 14th of February, The Court of Accounts of Republic of Moldova (CoARM) presented the Audit report on compliance of subsidies granted to Moldsilva Agency in 2022 and 2023, in order to non-accepting the increase of the prices for the firewood sold to the citizens in the cold season.

Tatiana Sevciuc, CoARM member, and responsible auditors from the General Audit Department I, presented to the Public Finance Control Committee (PFCC) members the main findings and recommendations, formulated by the Supreme Audit Institution.

According to the audit report, in the context of the precarious situation of energetic resources, generated by multiple risk factors, which have influenced the increase of energetic resources, the Exceptional Situations Committee of the Republic of Moldova, ordered the allocation of 64,25 mil. lei. This decision was taken in order to reduce the crisis impact and diminish the energetic burden of the citizens, as well as to ensure the necessary wooden stocks for the cold period of 2022-2023.

Thus, on 28th of December 2023, The Court of Accounts of Republic of Moldova, during the online meeting, examined the Audit report on compliance of subsidies granted to Moldsilva Agency in 2022 and 2023, in order to non-accepting the increase of the prices for the firewood, sold to the citizens in the cold season.

The Court of Accounts concluded that the actions taken by the decision makers have determined the simplification and the acceleration of the process of gaining the authorization for cuttings of the forest vegetation, including the execution of silvotechnical works anticipated in 2022, counting as for the year of 2023. As a result, the wooden stocks were increased, but the volume of the fire woods sold in 2022 is with 30.2 mil. square meters less than that of 2021, being conditioned by the limiting of wooden volumes allowed to be sold to the eligible beneficiaries.

The malfunction of designed internal controls has determined in the case of only 4 silvic entities the selling of 2.3 thousand stere meter (m/st) of fire woods to the non-eligible beneficiaries and exceeding the allowed limits of buying fire woods with 1.4 m/st. The method developed and approved by Moldsilva Agency of creating, managing and applying the selling prices of the wooden products is of an ambiguous kind and contributes to obtaining additional revenues and exaggerate profits by the State Enterprise for Forestry.

The mechanism developed by the Ministry of Environment aimed to distribute the budgetary means, did not  correspond and lead to granting increased subsidies meant to accelerate the collection of wooden products and non-admitting the increase of the prices to the fire woods for the citizens.

The Court of Accounts concluded that the unique character of this exercise managed by the involved actors, has determined the projection of internal controls as insufficient and nonfunctional, fact that contributed directly to non-compliance risk materialization.

As a result of report audition, Public Finance Control Committee (PFCC) recommended to the audited entities, to undertake necessary means in order to remediate the irregularities and established nonconformities, declared by the Court of Accounts.

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