The Court of Accounts of the Republic of Moldova (CoARM) presented on March 16 this year, within the Public Finance Control Committee (PFCC) of the Parliament of the Republic of Moldova, the Audit report on the financial reports of the administrative territorial unit Cimișlia district concluded on December 31, 2020 (ATU/level II budget) and the Compliance Audit Report on the budgetary process and the management of the public patrimony in 2020 within the administrative territorial unit of Cimișlia district (ATU/level II budget).
A brief presentation of the Audit Report was made by Eduard Moroșan, Member of the CoARM, as well as by those responsible for the audit: Sergiu Știrbu and Maria Tabacari.
According to the data of the balance sheet of the targeted entity, on 31.12.2020, the total value of assets amounted to 217.23 million lei. For the year 2020, the district budget was executed on the part of revenues in the amount of 164.05 million lei or 97.7 percent of the specified budget, and on the part of expenditures - in the amount of 160.26 million lei or 92,7 percent.
In the opinion of the Court of Accounts, with some possible exceptions, described in the Financial Audit Report, the financial reports of the ATU Cimișlia District Council provide, in all significant aspects, a real and accurate picture according to the applicable financial reporting framework. The main deficiencies identified relate to:
- The increase of the value of the “Buildings” account by 7.09 million lei, as a result of the non-compliant registration of repairs to the buildings owned by the ATU level I, as well as a result of the double registration of the old people's home building in the amount of 2.78 million lei;
- Overestimation of the “Special Constructions” account with 30.48 million lei following the non-transfer of the owners of local (ATU level I) and regional (S.E. ASD) roads the value of construction works and capital repairs of roads in the amount of 24.87 million lei, incorrect classification of real estate of 3.37 million lei, etc.;
- Increasing the value of the account "Current repair services" and decreasing the value of the account "Expenditures on the transfer of assets free of charge under the budget system" by the amount of 6.16 million lei, as a result of non-transfer of goods to local road repair works and of public street lighting, public property of ATU level I.
The audit was limited in confirming the value of the "Buildings" account in the amount of 16.33 million lei of the buildings managed and reported by the Public Medical Institutions, whose founder is the Cimișlia District Council, because contrary to the legal provisions the Cimișlia District Council did not ensure the registration of the property right over 11 real estates in the amount of 14.88 million lei, and the rights over 11 buildings in the amount of 1.46 million lei are registered upon the ATU level I and the Republic of Moldova.
The audit was also limited in quantifying the value of the high-pressure gas networks with a length of 17,123 km, which according to Government’s Decision no. 683 from 18.06.2004, were transmitted to the enterprises of the JSC "Moldovagaz" system for technical service. Also, 17 gas networks with a value of 18.77 million lei were not inventoried properly, not being verified their quantitative-value existence and the existence of documents confirming their transmission for technical service to specialized companies (gas pipelines from Albina village, Mereni village, Ivanovca Nouă village).
The ATU Cimișlia did not ensure the compliant registration, in the Real Estate Register, of the patrimonial rights over the local public real estate. For example, the property right over the lands on which the summer camp "Izvoraș" from Zloți village is located, in which investments amounting to 15.24 million lei were made, is registered after the Republic of Moldova. Also is missing the registration of rights and value in the accounting records of the special constructions located in this camp.
The ATU Cimișlia did not ensure the proper approval of the statutes of the Public Educational Institutions. Thus, out of 21 entities in their statutes as founder, are indicated as founder within 10 institutions – the Cimișlia District Council, within 9 institutions – the Ministry of Education and Research and within 2 institutions – the Cimișlia Education Department.
The Court of Accounts reveals that, during the evaluated period, although the ATU Cimișlia has taken some measures to ensure a proper management of the budgetary process and the local public patrimony, there are still areas that do not meet the requirements and, implicitly, the spirit of regularity and good governance. Thus, there are deviations and irregularities, such as: failure to implement internal control procedures that would hold the parties involved in the budget process accountable; non-compliance with the procedures for the procurement of goods, works and services; irregular use of public funds to capitalize on investments and capital repairs; failure to ensure full registration of ownership, etc.
In this context, the Court of Accounts has made recommendations for remedying gaps, deficiencies, non-compliances, as well as for reducing the risks mentioned in audit reports.