WITH DEFICIENCES OF VIEW
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The Court of Accounts of the Republic of Moldova, on May 27, examined the Audit Report on the consolidated financial statements of the Ministry of Economy and Infrastructure concluded on December 31, 2021, Audit report on the consolidated financial statements of the Ministry of Infrastructure and Regional Development concluded on December 31, 2021 and the Audit Report on the consolidated financial statements of the Ministry of Economy concluded on December 31, 2021.
Until the restructuring of the specialized central public administration, the Ministry of Economy and Infrastructure was the institution that, including through subordinated entities, ensured the realization of the governmental policy in the following fields of activity: economy; information and communication technology; constructions; transport; quality infrastructure and market surveillance; security and energy efficiency; tourism.
As a result of the reorganization process, the Ministry of Economy and Infrastructure transferred in full, according to the provisions of the regulatory framework in force, the assets managed to the Ministry of Infrastructure and Regional Development reporting at the end of the management period the balance of balance sheets at 0.
In order to carry out the activities planned in 2021, financial resources were specified for the Ministry of Economy and Infrastructure in a total amount of 1404.15 million lei, being capitalized 1352.28 million lei, which represents 96.3% of the specified allocations. It is attested that during the management period the revenues of the ministry were constituted from the following sources: from the account of the state budget allocations - 532.38 million lei, which represents about 84%, from the receipts from the provision of paid services - 81.48 million. lei, which represents 12.8% of the grants received - 19.97 million lei or 3.1%. At the same time, the actual expenses of the ministry were distributed as follows: the subsidies granted - 386.98 million lei; other expenses - 195.05 million lei; personnel expenses - 89.75 million lei, grants awarded - 66.06 million lei and expenses regarding goods and services 50.49 million lei.
Following the audit of the consolidated financial statements of the Ministry of Economy and Infrastructure for the budget year ended December 31, 2021, a qualified audit opinion was issued.
The findings that affected the audit opinion are also found in the basis for the reserved opinion of the Ministry of Infrastructure and Regional Development, the successor of rights and obligations of the Ministry of Economy and Infrastructure, being presented below.
The budget of the Ministry of Infrastructure and Regional Development for 2021 consisted of 8 budget programs and 23 sub-programs. The managed patrimony belongs entirely to the state, which at the end of the year amounted to 7255.27 million lei. For the management period of 2021, financial resources in the total amount of 2786.54 million lei were planned, and following the rectification of the budget, financial resources in the amount of 2779.96 million lei were specified. During the management period, 1988.83 million lei were capitalized, which represents 71.5% of the amount of the specified allocations. The cause that admitted the non-capitalization of 791.13 million lei was the global pandemic situation which, including in view of the restrictions imposed at national level, delayed the implementation of several activities initially planned.
The Ministry of Infrastructure and Regional Development prepared and administered the budget according to the principles, rules and procedures provided by the Law on Public Finance and Budgetary-Fiscal Responsibility. The revenues of the ministry were constituted from the account of the state budget allocations - 1204.68 million lei, which represents about 96% of the total actual revenues and from the receipts from the provision of paid services - 46.58 million lei which represents 3.7 %. At the same time, the actual expenses of the ministry were distributed as follows: the subsidies granted - 1019.46 million lei; other expenses - 693.82 million lei; grants awarded - 86.82 million lei and personnel expenses - 42.82 million lei.
The basis for the qualified opinion was determined by the fact that the Public Institution of the Social Investment Fund in Moldova did not reflect in the accounting the transfer of the investments made in order to improve the conditions of activity in the educational units to the beneficiary communities which generated the overvaluation of fixed assets by at least 67.88 million lei and the underestimation of expenditures and corrections of the results of previous years in the same amount. At the same time, the financial result of the management year was distorted by about 55.04 million lei.
At the same time, the State Enterprise "State Road Administration", due to the misinterpretation of the Enforcement Order on the recognition of the Foreign Arbitral Award and the approval of the enforcement of damages, incorrectly calculated the established interest and penalties, thus overestimating the expenses of the management period and underestimating the financial result by about 73.9 million lei, and the debt to the entrepreneur was overestimated by 70.6 million lei.
Likewise, the PI Unit for the Implementation of the Housing Construction Project for the Socially Vulnerable People II, did not properly record in the accounting the transactions related to the investments of 31 social apartments in the housing complex in the town Ialoveni, given that it was finished in 2018 and distributed to the inhabitants. It is noted that so far the apartments are incorrectly reflected in the composition of investments in assets under construction, which generated the overestimation of the respective group of accounts by 19.9 million lei and the underestimation of the corrections of the results of previous years with the same amount.
Regarding the results of the audit on the consolidated financial statements of the Ministry of Economy concluded on December 31, 2021, the auditors of the Court of Accounts reported the following.
The Ministry of Economy is the central specialized body of the public administration which, starting with September 1, 2021, including through the subordinated entities, ensures the realization of the governmental policy in the following fields of activity: economic policies; regulation of the business environment and small and medium enterprises; investment and industrial development; public property management policies; information technology and the digital economy; quality infrastructure and market surveillance; international economic cooperation and trade policies.
The patrimony managed by the Ministry of Economy belongs entirely to the state, and at the end of 2021 it amounted to 13.21 million lei. In accordance with the State Budget Law, financial resources were planned for the audited period in the total amount of 166.52 million lei, and 151.74 million lei were capitalized, which represents 91% of the amount of planned allocations. The devaluation of 14.78 million lei was conditioned by the effects of the pandemic situation, but also due to the restructuring of the specialized central public administration.
In the year of management, the actual revenues of the ministry were constituted only from the account of the state budget allocations, which amounted to 138.95 million lei. The actual expenses of the ministry were distributed as follows: grants awarded - 131.61 million lei; expenses on goods and services 6.89 million lei; personnel expenses - 5.85 million lei, other expenses - 3.78 million lei.
Following the audit of the consolidated financial statements of the Ministry of Economy, the Court of Accounts issued a qualified audit opinion. The basis for the reserved audit opinion was determined by the fact that the Ministry of Economy erroneously reported the balance of the financial resources available in the accounts of the Organization for the Development of the Small and Medium Enterprises Sector (ODSME), which was overestimated by 10.23 million lei. ODSME, without the consent of the Ministry of Economy, paid in advance the amount mentioned for another external financing project, in which, according to the contractual clauses, the donor covers only 80% of the total amount in the first phase, and the remaining 20% will be transferred upon completion and project auditing. According to the explanations, the financial resources are to be returned to the treasury accounts of ODSME after the independent audit of the project financed by the Delegation of the European Union.
Likewise, the allocation of additional financial resources in the amount of 10 million lei to the Balti Free Economic Zone is attested, in the context of the Development Program for Local Suppliers, provided that the performance indicators initially established, in accordance with the financial means allocated for the corresponding stage, were not realized. It therefore indicates the risk of non-achievement of the purpose of the said Program and the inefficient use of the grants awarded.
