Minister Vrankić Opens Conference on Public Internal Financial Control



Deputy Chairman of the Council of Ministers of Bosnia and Herzegovina and Minister of Finance and Treasury Dragan Vrakić opened a Conference on Internal Financial Control, which started in Sarajevo today, organised by the Ministry of Finance and Treasury of B-H and supported by the Technical Assistance Project titled “Support to Introduction of Internal Pubic Financial Control”, sponsored by the European Union. The internal public financial control includes audit and financial management and control, and it represents an important framework for the implementation of  the EU acquis communautaire, which implies an establishment of institutions capable of public funds spending control, thereby supporting the public administration reform, as one of the benchmarks in the B-H’s EU integration process.

The aim of the Conference is awareness rising with senior mangers concerning the internal public financial control, especially in view of the legislation adopted and importance of public internal financial control for the EU integration process of B-H.

Opening the Conference, Minister Vrankić said that within the reforms relevant for the fulfilment of obligations B-H assumed on signing the Stabilisation and Association Agreement, in part “Cooperation in Audit and Financial Control”, the Council of Ministers adopted a document titled “B-H Institutions Public Internal Financial Control Implementation Strategy”- PIFC- with similar documents being adopted by Entity Governments, as well.

-        Adopting these documents, B-H builds a foundation for development of all-level system to include the adoption of relevant regulations for development of internal financial control in the public sector, together with a functional and independent internal audit and independent external audit system, in line with the internationally recognised standards of audit and control and methodologies and best practice of the EU, said Minister Vrankić.

The implementation of PIFC Strategy, as he stressed, implies a setting-up organisation units within the Ministry of Finance and Treasury, such as the Central Harmonisation Unit and independent Internal Audit Division, which, each for itself, represent leverage for the introduction of the PIFC concept in B-H Institutions.

He added that the Ministry of Finance and Treasury has already completed these activities and that within its competences it strongly supports the operability of a body responsible for coordination of relevant activities with Entity level bodies.

-          A major responsibility is certainly on the Ministry, because it concerns the Budget and legal obligations of the establishment of PIFC structure, but it is important to understand that manager of each institution is responsible for establishment of financial management system and putting a control framework (FMC) in place. Experiences show that the introduction of financial management and control concept relies on good practices from this area, with due care taken of peculiarities of each state, starting from the level of development, mentality, constitution arrangement and others, Vrankić said.

Head of the Section for Economic Development Operations, Natural Resources and Infrastructure of the EU Delegation in B-H Johann Hesse said that the internal financial control in B-H is one of the elements EU wants to see well functioning in order to move further and transfer fund management.

-          The public administration and Ministers must be accountable for the money they spend, Hesse said.

Head of PIFC Team Robert Konning underlines that this issue is a key issue for the Ministry of Finance and Treasury and that it represents a basis for good management.

According to Head of Central Harmonisation Unit within the Ministry of Finance and Treasury Ranko Šakota, the process of establishment of PIFC structures may take seven years. (Fena)