Buletin 3_4-2010 web.pdf - Curtea de Conturi a Republicii Moldova

As a result of the Public Finance Management Project, started
in 2006 and continued in the present, public entities should adjust
their internal control systems to best practices and international standards
.
In this regard, the Ministry of Finance – the institution responsible
for the second component of the Public Finance Management Project,
has developed the legal framework for the implementation of
internal control and audit, and recently, in September 2010, the Parliament
adopted the Law on public internal financial control, which
will take effect in one year, after its publication in the Official Gazette,
and will be a sound basis for managers of public entities to implement
the internal control system in the institutions they manage .
One of the elements of the internal control system is financial management
and control (hereinafter – FMC), which includes all activities
and processes of the public entity . The implementation of FMC
is accomplished according to national standards on internal control,
and is based on the five elements of COSO model .
The primary responsibility for implementation of this system lies
with the manager, who monitors how the operational managers control
the processes and who in turn hold the employees responsible
for the establishment of internal control policies that are more specific
to their activity . Therefore, to a certain extent, each employee of
the public entity contributes and is responsible for the implementation
of FMC, having responsibilities and tasks set by the manager, and
put in practice by employees .
As a result of external audit missions performed by the Court of
Accounts in 2010 in local and central public authorities, multiple deficiencies,
related to the accounting and financial discipline, were identified
. These deficiencies occur primarily because the FMC system is
not implemented, and adversely affect the management of public
funds by entities .
the main findings identified by the Court of accounts’ teams
are the following:
1 . A large part of audited public entities do not set strategic objectives,
which are the main goals an entity should achieve, in order
to reach its overall goal . The objectives are usually set on medium or
long term, and are derived from the corresponding government policies
. The same refers to the operational objectives, which should
be normally set for a period of one year, and stand for the operational
business goals needed for the achievement of strategic objectives .
2 . Facing FMC implementation, auditees find themselves without
the description and documentation of operational processes, which
Internal Audit
fInanCIal management and Control
SyStem In publIC entItIeS
Ana Radu,
head of internal Audit Service
47
internal Audit