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The Supreme Audit Institutions (SAIs) of the Republic of Moldova, Georgia and Latvia will launch a collaboration in 2023 in the context of the exchange of experience and best practices regarding the auditing of the state budget.
The initiative was discussed by the team of the Court of Accounts of the Republic of Moldova (CoARM), led by Petru Rotaru, Member of the CoARM, during an online meeting with colleagues from the State Audit Office of Latvia, on December 7.
The initiative is part of the activities of the Development Cooperation Project "Strengthening the capacities of the Supreme Audit Institutions (SAIs) of Georgia, Moldova and Ukraine in the improved application of the International Auditing Standards of INTOSAI", implemented by the State Audit Office of Latvia. In the context of the initiative, the SAI of Latvia will share the national experience in adjusting the accounting and reporting methodologies of the national public sector to international practices.
We note that the CoARM has repeatedly mentioned the existence of major discrepancies between national public sector accounting and reporting methodologies and international practices. Currently, there is a lack of a well-defined mechanism for consolidating state assets and liabilities. The state budget execution record is kept based on the cash method, the obligations towards the SB for the payment of taxes and fees (arrears), as well as the state debt and state recrediting are reported by the State Treasury to the off-balance sheet accounts, and within the ministries the accounting record is organized on the basis of commitments. This situation limits the overall vision of the way of administration of public financial resources and public patrimony.
The Court of Accounts emphasizes the need to align the accounting records and financial reporting in the budget sector to the International Public Sector Accounting Standards (IPSAS). This task must be among the priorities of the future Public Finance Management Strategy by setting the time frame and necessary measures to develop and introduce the National Accounting Standards for the Public Sector (NASPS). This strategic objective requires strengthening the efforts of all actors involved, as well as expertise and external support for the adoption of good international practices in the field. Following this exercise, the effectiveness, efficiency, responsibility and transparency of public finance management will be strengthened.
