The Importance of Financial Accountability of the Serbian Authorities

06 June 2012.
The Importance of Financial Accountability of the Serbian Authorities

Independent State Auditor is a vital link between the executive arm of government and the Parliament on the one hand and citizens on the other. The auditor oversees the regularity of the executive branch, conducts independent investigation, thus determining and confirming the credibility of the institutions, Mr. Radoslav Sretenovic said, President of the State Audit Institution. In the opening speech of the Conference "Toward Greater Financial Accountability of the Authorities in Serbia" Mr. Sretenovic emphasized that the principles of good governance, especially transparency and accountability, equality and fair treatment, efficiency and effectiveness, compliance with legal standards and high ethical standards are the bases for building reliable and open governance.

Achieving the goals of accountability and transparency of operations, as two key principles of good management, depends largely on how the audit function operates. For this reason, parliaments of many countries in the world provide a large degree of independence to their supreme audit institutions, Mr. Sretenovic said. According to him, the quality of the implementation of development programs and goals of the Government depends heavily on the functioning of internal audit and internal control. The more effective internal audit is, the "fear" of the external audit becomes smaller.

Unlike most EU member states, there is a lot work to be done in order to establish a modern and sufficiently objective internal control and audit functions in public administration, Mr. Sretenovic said. He added that the experts in Serbia assessed that important progress in the development of internal mechanisms of financial accountability have occurred in the past years. This is supported by findings in our reports. However, a lot more should be done, in order to meet European standards and criteria in the areas of internal control system and internal audit, the Auditor General concluded. He said that the State Audit Institution would continue its struggle for achieving the stature enjoyed by the similar institutions in other democracies, developed countries, and endeavor to strengthen its capacities.

Commissioner for Information of Public Importance and Personal Data Protection Mr. Rodoljub Sabic, said that for every regulated state, especially for transition countries, financial responsibility was a priority.

State Audit Institution should become well equipped, as soon as possible, to supervise public expenditure, not only in terms of legality, but also from the standpoint of performance audit, Mr. Sabic concluded.

Mr. Sasa Jankovic, Ombudsman, appealed for the return of ethics and morality in public administration, because in this case the taxpayers' money would be properly managed.
Until good governance among civil servants becomes reality, current independent state watchdogs will have little influence and remain unable to change anything, Mr. Jankovic said.

Mr. Wind Lawrence, Chief of Party of Judicial Reform and Responsible Government Project, said that USAID has supported transparent and accountable governance and will continue to assist in identifying the elements of corruption. According to him, public funds should be used effectively, and recommendations from the State Audit Institution, provided to audited entities, could be helpful in that respect.

Ms. Milica Delevic, Director of the Serbian European Integration Office, said that the financial accountability of government is the most important part of government responsibility and that accountability in Serbia should be established independently from European integration. She noted that the issue of financial control is part of the negotiation process in Serbia's EU accession path. Ms. Delevic also stressed that the State Audit Institution is in institution build-up stage of the development.

In the second panel, which included the discussion of the role of the National Assembly in the creation of financial accountability of government, Ms. Ljubica Nedeljkovic, Vice President of the Council of the State Audit Institution, addressed the audience. She added that financial accountability is considered within overall public finance management.

According to her, the Law on State Audit Institution is based on the best practices of European countries and, thus, the fact that Serbia was the last country in Europe to establish the SAI was used wisely. In Law, we have included the best solutions developed by the institutions with a long tradition, Ms. Nedeljkovic said.

In order to improve cooperation with the Parliament, the State Audit Institution may increase the scope and nature of the audits, use international standards in preparing reports and submit reports to the Parliament in due time. Particularly important is the cooperation with the National Assembly relating to response to audit reports. Only if we jointly analyze the recommendations and measures undertaken in respect of audited entities, can we see our contribution to the improvement of work, Ms. Nedeljkovic concluded.

Ms. Jorgovanka Tabakovic, a member of the Finance Committee, pointed out that when it comes to the financial responsibility of the Serbian authorities, one should act preemptively. She added that the State Audit Institution represents an undisputed authority in assessment of spending of allocated funds. Since its establishment, the State Audit Institution has never compromised the level of professional expertise, she Ms. Tabakovic said.

The relationship between Parliament and the State Audit Institution was topic of the speech delivered by Mr. Radojko Obradovic, a member of the Finance Committee. In his view, the success of the State Audit Institution includes addressing the systemic errors and developing legal solutions so that those errors would be corrected permanently. He said it was good that the State Audit Institution had significant capacities, that the scope of the audit is being expanded and that conclusions become ever stronger.

During the second panel Mr. Nemanja Nenadic, Program Director of Transparency Serbia, addressed the participants, pointing out to the fact that ministerial responsibility does not exist.

Members of Parliament have the opportunity to initiate the ministerial responsibility based on reports of the State Audit Institution and the Commissioner for Information of Public Importance, Mr. Nenadic said.

The third part of the conference referred to the cooperation of civil society, relating to monitoring of implementation of recommendations and policies of the State Audit Institution. The participants were addressed by Ms. Ivana Cirkovic, Director of the Serbian Government Office for Cooperation with Civil Society, Mr. Nebojsa Lazarevic, Director of the European Policy Centre , Mr. Andrija Pejovic, a representative of the European Project Center and Mr. Ivan Knezevic, Deputy Secretary General of European Movement in Serbia. Mr. Knezevic said that there was the need to improve the environment for the functioning of independent institutions, such as the State Audit Institution. In this regard, the role of civil society can be reflected through monitoring of effects and promotion of the findings, as a result of the State Audit Institution’s activities, as well as through open cooperation with the National Audit Institution.

During the conference, Mr. Nebojsa Lazarevic, Director of the Centre for European Policy, presented a study on the implementation of recommendations and policies of the State Audit Institution, which was the reason for organizing the event. The final version of this research will be completed next week.

Conference "Towards Greater Financial Accountability of Authorities in Serbia" is organized under the project "Establishing Conditions for the Improvement of the State Audit Institution in Serbia", financed by USAID, within Judicial Reform and Responsible Government Project.
The event was organized by the State Audit Institution, in cooperation with the Centre for European Policy and the European Project Center.