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The significance of the audit of consolidated financial statements at the Government level to enhance the quality of state resource management and possible ways and challenges in this process were discussed on June 28 during the roundtable "Audit of Consolidated Financial Statements: Perspectives and Challenges."
Heads and specialists from the Accounting Chamber, as well as representatives from the Verkhovna Rada, the Ministry of Finance, and the EU Delegation to Ukraine, the State Audit Service, the Audit Chamber of Ukraine, the State Treasury Service, the scientific community, and the Project "Strengthening Capacities in External Audit in line with International Standards (EU4ACU)" took part at the event.
In her opening remarks, Chairwoman of the Accounting Chamber Olha Pishchanska noted that the consolidated reporting at the Government level, which, according to European and International analogues, should include data from main administrators, all state-owned enterprises and banks, information about other assets and liabilities of the State, would provide a comprehensive picture of whether the country effectively manages its resources. The implementation of such reporting by the Government will help the State better use its existing resources and ensure public accountability of the Cabinet of Ministers and main administrators, allowing taxpayers to see how systematically and substantiated these resources are allocated to societal needs, emphasized the Chairwoman of the Accounting Chamber.
"The audit of this consolidated financial reporting will significantly increase its accuracy and completeness as a key criterion for making balanced budget decisions by the Parliament and the Government. This, in turn, will help find the best tools for Ukraine's development," Olha Pishchanska said.
The Chairwoman of the Accounting Chamber also drew the participants' attention to the fact that the submission of consolidated reports by the Government and their audit by the Accounting Chamber can contribute to transparency in the use of public finances, financial stability, economic development, and the investment attractiveness of the country. She recalled that the Accounting Chamber has already adopted a number of internal documents regarding the possibility of conducting audits of consolidated financial statements at the national level. At the same time for the implementation of the audit of the government's consolidated financial statements, it is necessary to make relevant changes to legislation, update the regulatory framework, and ensure that the Accounting Chamber has free access to information and is not dependent on government structures.
In response, Chairwoman of the Committee on Budget of the Verkhovna Rada Roxolana Pidlasa noted that currently, the Verkhovna Rada, together with stakeholders, is working on the development of a new law on the Accounting Chamber. Therefore, after working out consolidated proposals regarding the formation of consolidated reporting by the Government and its subsequent audit by the Accounting Chamber, the working group will consider them and decide on the possibility of amending the draft law.
Acting Secretary of the Accounting Chamber - Chief Administrative Officer Vasyl Nevіdomyi noted that the Accounting Chamber "is not standing still" and has already begun conducting relevant audits at the level of main administrators.
"We want to increase the 'weight' of consolidated financial statements audits of main administrators to 25-50%, which are significant recipients of budget funds and international assistance. We are already applying a risk assessment algorithm to prioritize audits of main administrators for the next year," emphasized Vasyl Nevіdomyi.
First Deputy Minister of Finance Denys Uliutin, as a representative of the Ministry that could be key in the process of forming this reporting, expressed the Ministry's interest in cooperation with the Accounting Chamber to confirm proper management of state resources. Chairwoman of the Audit Chamber of Ukraine Tetiana Kamenska emphasized the importance of consolidated financial statements audit for society, while Deputy Chairman of the State Treasury Service of Ukraine Liubov Starodubtseva noted that her institution is also ready to contribute to this issue within its powers.
Participants of the roundtable, including European experts, expressed their thoughts. In particular, Team Leader of the EU4ACU Inguna Sudraba, Head of Sector of the Public Finance, Business Support and Social Sectors of the EU Delegation to Ukraine Henrik Huitfeldt, Representative of the State Audit Office and EU4ACU Project Expert Lelde Dimante. Representatives of the scientific community also expressed their opinions: Director of the Institute of Economics and Forecasting of the National Academy of Sciences of Ukraine Valerii Heiets; Professor of the Institute of Economics and Forecasting of the National Academy of Sciences of Ukraine Inna Lunina; Senior Research Fellow of the Institute of Economics and Forecasting of the National Academy of Sciences of Ukraine Valentyna Balytska; Corresponding Member of the National Academy of Sciences of Ukraine, Head of the Finance Department of Kyiv Taras Shevchenko University Ihor Liutyi; Vice-President of the National Academy of Sciences of Ukraine, Director of the Institute of Political and Ethnic Studies named after I.F. Kuras Oleh Rafalskyi. They also supported the idea of forming consolidated financial reporting at the national level.
At the suggestion of the Chairwoman of the Accounting Chamber, the proposals expressed by the roundtable participants regarding the possibility of introducing an audit of consolidated financial statements by the Government will be summarized for further discussion at the level of experts and lawmakers.
Video of the event can be found at the link.
