Staff reposition encourages financial irregularities

Last week, Ulaanbaatar Audit Office held “Policy and methodology for assessing the implementation and effectiveness of audit decisions” themed conference.

One intriguing issue raised during this event was that the auditors annually inspect government organizations, state-owned companies, and local-owned companies and make recommendations to eliminate financial violations, but the reason for their non-implementation is reposition of workers. For example, since the beginning of the establishment of the Education Loan Fund (ELF), every time the audit organization conducts an audit, it has asked to “Calculate the receivables and confirm the calculation. A person who did not meet the requirements has received a loan from ELF, remove the violation,” but it was not implemented due to frequent changes of the directors and accountants. Such problems are not only faced by ELF, but by all state organizations and state-owned companies. In other words, auditors have established a precedent that the act they issued last year will be re-examined the following year. There are cases where some government organizations ignore the official requirements of the audit organization. They also pointed out that the attitude that they come and make official demands is the reason for the non-reduction of financial violations in government institutions. In addition, there are cases where the statute of limitations has expired when a dispute is filed in court. Also, by giving the same recommendation repeatedly on the same issue, the value is lost.

Moreover, acting Deputy Auditor of the Ulaanbaatar Audit Office Ts.Naranchimeg said about the consultation, “This year is announced to improve transparency and accountability in the implementation of the decisions of the state audit organization. A working group is working to ensure the implementation of the recommendations given by the government agencies to the examinees. The discussion is organized in this context. Then, they talked about what should auditors, managers, and officials who conduct an audit of the state audit organization need to pay attention to, how useful our recommendations are. The audit report is submitted openly. According to the law, the organization must report transparently. We are discussing the significance of disclosing that information.”

Also she said, “The state audit organization is a member organization of the international INTOSAI (International Organization of Supreme Audit Institutions) with standards that operate independently. The audit report is submitted every year, and there is an international experience in which it is necessary to cooperate with media and non-governmental organizations to eliminate the errors and violations found in this report. We are discussing the issue of making all the reports transparent, and the need to report the decisions made by the auditors in a timely manner.”