BNAO ROLE FOR EFFECTIVE
MANAGEMENT OF PUBLIC
FINANCES
Tzvetan Tzvetkov, CIA, CGAP, CRMA President of the Bulgarian National Audit Office
Bulgarian National Audit Office:
A supreme audit institution which
exercises control over the execution
of the budget and other public funds
and activities.
ISSAI 12:
Public sector auditing, as championed by the SAIs, is an important
factor in making a difference to the lives of citizens. The SAI is an
essential component in a democratic system where accountability,
good governance and integrity are indispensable parts
of a stable democracy.
BNAO role for ensuring good governance
Direct influence:
Evaluation of the state of
financial management and
control at budgetary
organization level;
Making recommendations for
their improvement;
Follow up on the recommendations.
Indirect influence:
Providing assurance to the
public and the National
Assembly that public funds are
spent in a lawful manner,
financial statements are
reliable and state and municipal
property is managed
effectively.
Activities for exerting direct influence:
Evaluation of the state of financial management and control in the
public sector – submitting annual reports to the National Assembly;
Making recommendations for improvement, incl. following up on the
recommendations;
Informing the relevant parliamentary commissions, the ministry of
finance or the municipal council in the event of non-fulfilment;
Imposing sanctions for violations of the Public Procurement Act, the
Political Parties Act and the Election Code;
Sending reports to the prosecutor’s office when data indicating
possible crimes are identified or to PFIA in the event of financial
violations.
Activities for exerting indirect influence:
 Participation in discussion fora, conferences and round tables,
conducting joint studies with NGOs;
 Presenting statements on draft legislation;
 Participation in working groups on elaboration of policies, positions,
etc;
 Cooperation and coordination agreements with other control bodies;
 Cooperation agreements with non-governmental professional
organisations;
 Publication of audit results:
o Publication of audit reports on the BNAO website;
o Press conferences on significant audits;
o Publications in the press, interviews for the media, participation in TV
programmes.
The new paradigm of SAI role for good governance:
The value and benefits of SAIs is in making a difference
to the lives of citizens by:

Strengthening the accountability,
transparency and integrity of
government and public sector entities;

Demonstrating ongoing relevance to
citizens, Parliament and other
stakeholders and appropriate
responding to the changing
environments and emerging risks;

Being a model organisation through
leading by example.
Audits to ensure accountability for the stewardship
over public funds:
SAIs should strive to meet the expectations of the stakeholders –
parliament, citizens, government, NGOs, etc.
 SAIs should conduct the whole palette of audits –
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

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financial audits, performance audits and compliance audits;
Do those charged with governance apply the principles
of sound management of public funds?
Including audits on issues and themes with social
significance in SAI’s audit programme;
Participation in parallel and coordinated audits in the
framework of INTOSAI and EUROSAI;
Thematic audits with horizontal coverage for
identifying system problems and proposing solutions;
Response to risks of financial violations, fraud and
corruption.
Dialogue with stakeholders:
Communication should contribute to
stakeholders’ awareness of the need for transparency
and accountability in the public sector:
Cooperation with parliament aimed at better understanding of the audit
reports and undertaking the respective corrective measures;
Ensuring open communication with the auditees, incl. during the audit
process;
Cooperation with the media in order to facilitate and increase citizens’ and
NGOs’ awareness of SAI’s audit results;
Identifying topics, trends, root causes and recommendations to discuss with
the stakeholders.
Reporting on audit results:
SAIs should use actively their powers to report on their work:
 Make audit reports available to the public in a timely
manner;
 Facilitate access through appropriate communication tools;
 Report objectively in a simple and clear manner;
 Discuss audit reports in parliament and its commissions with
the aim of improving public sector management.
SAIs - initiators of change:
SAIs should be a credible source of independent and objective
evaluations and initiators of change:
 To contribute to the debate on improving governance, internal
control and risk management in the public sector;
 To use their knowledge and studies to advocate public sector
reform– e.g. in the management of public finances;
 Periodically assess whether stakeholders believe that they are
effective and contribute to improvements in the public sector;
 To encourage sharing of knowledge and good practice among
budgetary organisations.
SAIs – model organisations:
 SAI organisation management should be based on
the matrix ”objectives-risks-controls”;
 Focus on ethics – adherence to ethical principles and
norms, sanctioning unethical behaviour;
 Results-oriented budget, which is a tool for achieving the objectives
of the organisation;
 Implementation of internationally accepted auditing standards and
internal control frameworks;
 Effective mechanisms for identifying and preventing conflicts of
interest;
 External assessment of the quality of SAI’s work;
 Open dialogue and communication with stakeholders.
Thank you for your attention!