© OECD

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The independence of the Court of Auditors,a guarantee of its efficiency

Wojciech KUTYŁASupreme Public Finances Audit Institution of Poland

Tunis, 12 July 2016

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SUPREME AUDIT OFFICE of POLAND (NIK)

Wojciech KutyłaVice-President of NIK

12 July 2016

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POLAND

• Poland (Polish: Polska, officially the Republic of Poland)• Neighbours: Germany, the Czech Republic, Slovakia, Ukraine, Belarus, Kaliningrad Oblast (a Russian exclave) and Lithuania• Total area: 312,679 square kilometres (120,726 sqare miles)• The 69th largest country in the world and the 9th largest in Europe

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POLAND

• Population: 38.5 million people: the 34th most populous country in the world, the 8th most populous country in Europe, and the sixth most populous member of the European Union.

• Unitary state divided into 16 administrative regions (voivodeships), 379 powiats (including 65 cities with powiat status) and 2,478 gminas (municipality)

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STRONG LEGAL FOUNDATIONSAND HIGH PROFILE OF NIK

• Constitution of the Republic of Poland of the year 1997• Supreme Audit Office of Poland (NIK)• President of the Supreme Audit Office of Poland (NIK)

• NIK President is elected by the Sejm (the lower chamber of the Parliament) with the consent of the Senat

• Term of office: six-years (possible tenure renewal)• Immunity of the President

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ORIGINS • Established on 7 February 1919 by Head of the Polish State Józef Piłsudski

• Operated (almost) continuously since then Pre-war period WW2 Communist regime Democracy re-established

• Act on NIK of 1994 (significantly amended in 2010)• Constitution of the year 1997

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SAI MODEL

• monocratic audit office with elements of collegiality

led by the President 3 Vice-Presidents proposed by the NIK President and appointed by the Sejm Speaker NIK Council: NIK President, Vice-Presidents, Director General, 7 external members, 7 internal members:

• passes the draft budget• passes the annual work plan• approves of the NIK Annual Report• approves of the Report on the Execution of the State Budget• passes the opinion on the vote of approval for the government

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AUDIT MANDATE

• The NIK’s mandate covers all state and local government bodies (some of them, e.g. courts, can be audited only with regard to the implementation of the budget, financial and property management)• Audit criteria: economy, efficiency, efficacy, sound management, integrity, and legality

• NIK can also audit, with regard to legality and proper management, the activity of other organisational units and enterprises, to the extent to which they use state or communal property or resources, or incur financial liabilities to the state.

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NIK’s AUDITS in 2015

• Annual Analysis of the implementation of the state budget execution and monetary policy guidelines and Annual Activity Report submitted and presented to the Sejm

• 90 audits of the implementation of the central budget

• 87 conclusions connected with the making or amending of law

• 2 audits of intenational organisations

• 117 planned audits (90 related to the state budget execution) and 144 ad hoc audits

• 4 international and parallel audits • 88 notifications to the commissioners responsible for discipline in public finances

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INTERNAL STRUCTURE

• Department of Strategy • Department of Audit Methodology & Professional Development• Department of Legal Affairs• Department of Budget & Finance• Department of Economy, Public Assets & Privatization• Department of Infrastructure• Department of Science, Education & National Heritage

• Department of Public Administration• Department of National Defence• Department of Public Order & Internal Security• Department of Labour, Social Affairs & Family• Department of Agriculture & Rural Development• Department of Environment• Department of Health• 16 Regional Branches (as many as regions in Poland)• 4 administrative departments

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STAFF

NIK employs ca. 1,700 people (half in the headquarters in Warsaw and half in Regional Branches)

including ca. 1,300 audit staff (auditors, audit managers and audit departments’ directors)

– online recruitment procedure– special status of audit staff– internal introductory course for auditors

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Poland: full implementation of Principle 8 of the INTOSAI

Mexico Declaration on SAI Independence

Principle 8 Financial and managerial/administrative autonomy and the availability of appropriate human, material, and monetary resources • SAIs should have available necessary and reasonable human, material,

and monetary resources—the Executive should not control or direct the access to these resources.

• SAIs manage their own budget and allocate it appropriately. • The Legislature or one of its commissions is responsible for ensuring

that SAIs have the proper resources to fulfill their mandate. • SAIs have the right of direct appeal to the Legislature if the resources

provided are insufficient to allow them to fulfill their mandate.

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Schedule of work on the state budget in Poland

• The Council of Ministers has exclusive legislative initiative• March/April – Finance Minister prepares and submits to the

Government a draft State budget • April/May – Finance Minister presents the macroeconomic

indicators • May – Finance Minister presents detailed rules, terms and modes of

preparation of materials to the draft budget• May – institutions receiving budget funds directly from the central

State budget draw up a revenue and expenditure plans • July – Finance Minister presents information on the budget

spending limits • within 21 days ministries present their draft budgets• September – Government adopts a budget bill • by the end of September the budget bill should be submitted to

the Sejm (Constitution, article 122.1)

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The NIK budget special procedure

• NIK President prepares the draft NIK budget – based on macroeconomic indicators presented by the Finance Minister

• NIK Council approves the NIK draft budget (article 23 section 1.5)• Government shall include the approved by NIK Council draft budget

into the draft of the state budget (no changes)• Changes into the draft budget of the NIK can be included only by the

Parliament (the Sejm and the Senate).• Sejm: Committee on State Audit, Committee on Public Finance – the

budget is adopted at the plenary session by the Sejm.• The adopted bill is passed to the Senate, where new amendments

may be included (within 20 days)• President of the Republic of Poland shall sign the budget law within 7

days or pass it for examination to the Constitutional Court

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Financial independence of NIK

• Article 26 of the Act on NIK

1. Draft budget of the NIK approved by NIK Council shall be included into the draft budget the state with no changes.

2. In relation to the NIK budget the NIK President fulfils the duties of the Finance Minister.

3. The Sejm regulates the way how NIK budget expenditures and revenues are audited.

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The NIK budget : EXTERNAL AUDIT

• Speaker of the Parliament (Sejm) entrusts the external audit to an entity selected in accordance with the public procurement regulations (once in three years)

• external audit is conducted by an entity independent of the Supreme Audit Office, with appropriate audit qualifications and skills

• the costs of the external audit are covered from the state budget (Chancellery of the Sejm)

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English-language website

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www.nik.gov.pl

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Thank you for your attention!