EUROSAI. Magazine N26 - 2021

EUROSAI 92 Studies and other articles In order to provide recommendations to the government in an efficient manner tomeet the urgency of the crisis, the Latvia SAI published the audit results and recommendations for eliminating deficiencies immediately after completing the audits. This was ensured by drafting and distributing 25 interim audit reports without waiting for the final outcome of the financial audits. This enabled the most operative communication on the findings and thus also the ability for the government to take these into account in further work. As a result, 41 recommendations were provided, some of which have already been implemented and taken into account when planning the new measures to curb the COVID-19 pandemic. In completing the audits of the COVID-19 allocations, the general conclusion is that the funds allocated for curbing the COVID-19 crisis have been spent in line with the purposes for which they have been designed. There are, however, some specific cases that were discussed within the scope of these audits. One issue is that there is no link established in terms of overcoming the COVID-19 crisis, and the criteria defined for granting support are not sufficiently economically justified. For example, support for farmers exceeds their reduction in income; the support eligibility criteria for export enterprises enabled that support was extended to companies for which export volumes and the number of employees had increased rather than decreased. The support to curb the COVID-19 was, in some cases used to solve long-lasting problems such as repairs to hospitals and cultural institutions. The audits of Latvia’s SAI also determined that in some cases criteria for granting aid were unclear and open to interpretation, thus creating unequal conditions for receiving support. Also, in some cases, aid administration mechanisms caused unnecessary administrative burden and additional administrative costs and in some cases, the aid was provided in breach of the established criteria. It was also found that the transparent use of state budget funds is not fully ensured in all cases. The audit approach was strengthened with open and transparent communication from the State Audit Office to the Government on the necessity to maintain good governance of public spending. This included a public address to decision-makers for accountability (made immediately after a state of emergency was announced in Latvia), an address to the Cabinet of Ministers with an invitation to share high risk areas in COVID-19 spending, the dissemination of a reminder to public institutions to follow good governance principles, and briefings to Government on areas, where allocation of aid shall be improved (such as compensation for work in an environment of high epidemiological risk or necessary improvements in procurement practices under the regulation of a state of emergency). The above were communication activities conducted on COVID-19 spending in addition to the standard communication of findings conducted for every audit which include: discussions with audited institutions on findings, the public launch of audit report, engagement with media and Public Expenditure and Audit Committee of Parliament. The audit approach was strengthened with open and transparent communication from the State Audit Office to the Government on the necessity to maintain good governance of public spending

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