Performance Budgeting and its Impact
on Audit of State Annual Accounts
Neringa Cikanavičiūtė
Principal Auditor
National Audit Office of Lithuania
3-5 September 2008
Druskininkai
Survey
• Performance budgeting in Lithuania
• State Budget formation
• Annual audit of State accounts
Development of performance
budgeting
• Budget reform since 1998
Programme budget in 1999
Strategic planning methodology in 2000
Internal audit in public institutions and authority
given to external audit in 2000
Public sector accounting reform in 2005
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Current situation
• Legal framework
Fiscal policy in the Convergence programme
Public sector – balanced or surplus
Rules of fiscal discipline
• Programme budget
Assessment system of institution activity
Appropriation managers and budgetary
programmes
Assessment system of
institution activity
Long term strategies of
administrative area and the
Government priorities
Institution’s strategic goals
Efficiency criteria
Institution’s programme goals
Result criteria
Institution’s programme tasks
Product criteria
Institution’s programme means
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Appropriation managers and
budgetary programmes
Appropriation managers (number)
267
261
250
257
256
246
2001
2002
2003
2004 2005
2006
253
250
2007
2008
Programmes (number)
558
515
533
623
653
676
682
709
757
438
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Recommendations for
budget system
• NAOL performance audit Programme
Budget System
• Development areas
Plan of budget formation
Government priorities
Draft of the Law on Budget
Macroeconomic & fiscal
forecasts
Consideration by Government
National Fiscal Plan
Principal indicators for 3 years
(approved by Government)
Maximum appropriations
Drafts of strategic operating plans
& State Budget programmes
Consideration by Seimas
Approval of the Law on Budget
NAOL opinions on account/report
• Opinion on:
Account of the Execution of the State
Budget
Draft of the State Budget
Report on Public Debt and Loans Given
from Funds Borrowed on Behalf of the
State and Given State Guarantees
Report on the State-owned Property
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Recent developments (1)
Audit of State Budget execution:
• More attention to
 Assessment of internal control
 Measure of budget programmes
• Recommendations
 To approve standards of internal control and audit
 To link programme assessment criteria to the used
appropriations
 Information about execution of programmes and their
assessment criteria
Execution of assessment
criteria in 2006
Institution
Result of assessment criteria (%)
Efficiency
Result
Product
Used
appropriations
to achieve
goals (%)
Ministries
114.4
132.3
154.2
78.2
Counties
104.9
112.1
143.9
99.2
Total
109.7
122.2
149.1
88.7
Recent developments (2)
Audit of the draft State Budget
• Attention to:
Number of appropriation managers and Budget
programmes
Assessment criteria of programmes
Strategic plans of institutions
• Recommendation
To improve Strategic planning methodology
Weakness of strategic planning
Examples in the opinion on the Draft State Budget 2008
Institution
Weakness of strategic planning and creation of programmes
Children’s Rights
Ombudsman
Institution
No assessment criteria (efficiency, result, product) for the
programme “Protection of Children rights and Their Legal
Interests”
Ministry of
Education and
Science
Assessed result criteria do not show whether the goal will be
achieved in the programme Management of Education Quality
Lithuanian
Geological Survey
In the programme Geology and Harmonious Development
efficiency criterion does not show benefit which must be derived,
the result criteria do not allow to assess the result of the
programme, in some cases the product criteria are identical with
functions.
Vilnius County
Governor's
Administration
Efficiency and product criteria do not allow to assess goals of the
programme Preschool and General Education in Eastern
Lithuania, products which must be developed, in some cases
the result and product criteria for the same goal are identical but
achievable rate are different.
Thank you !
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