## _100413a

## Source details

**Canonical URL:** [_100413a](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2013/_100413a.pdf)

## Other formats

- [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2013/_100413a.pdf.md)
- [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2013/_100413a.pdf.json)

---

### Executive summary — Introduction
- Pilot exercise on fiscal safeguards conducted by the Fiscal Affairs Department (FAD) during FY2013.
- Purpose: highlight fiscal safeguards risks where a substantial portion of Fund resources for balance of payments support is channeled to state treasuries for budget purposes.
- Five pilot countries: Antigua and Barbuda, Cyprus, Greece, Ireland, and Kyrgyz Republic.
- Paper draws lessons from the five pilots and proposes an approach to review fiscal safeguards risks; it does not provide recommendations for a full-fledged fiscal safeguards assessment.

### Background
- Safeguards policy applies to Fund resources made available to member countries in support of programs that address their balance of payments needs; domestic counterpart of disbursements may be made available for budgetary purposes.
- Recent programs: accounting for 87 percent of GRA resources and 37 percent of PRGT resources at end-May 2013.
- 2010 review encouraged staff to highlight fiscal safeguards risks but did not request a full methodology comparable to central bank safeguards assessments.
- FAD launched a pilot exercise in FY2013 covering several large budget financing cases over 12 months; participation was voluntary and confidentiality procedures similar to central bank safeguards applied.

### The pilots — methodology, timing, and costs
- Mission timing: Antigua and Barbuda (March 2013); Cyprus (May 2013); Greece (February 2013); Ireland (June 2012); Kyrgyz Republic (April 2013).
- Country selection criteria: large share of budgetary use of Fund financing; variation in size, income, and region; authorities’ willingness to volunteer and provide logistical support.
- Methodology:
  - Desk review of documents, including PEFA, FTA/fiscal ROSC, FAD PFM TA reports, and other organizations’ work.
  - Field work lasting two to three days by one or two FAD staff or experts.
  - In some cases combined with FAD PFM TA missions or inspection of an advisor in the field.
  - Draft report left with authorities for review.
- Costs:
  - Total costs: about US$120,000.
  - Cost per assessment varied between US$5,000 and US$35,000.

- Country summary (Table 1, as of May 31, 2013):
  - Cyprus — Population (mn.) 0.9; Lending Facility GRA; Access (SDR mn.) 891; Quota (SDR mn.) 158.2; Budget Support (SDR mn.) 891; Budget Support (% access) 100; Budget Support (% quota) 563
  - Greece — Population (mn.) 11.3; Lending Facility GRA; Access (SDR mn.) 23,785; Quota (SDR mn.) 1101.8; Budget Support (SDR mn.) 23,785; Budget Support (% access) 100; Budget Support (% quota) 2,159
  - Ireland — Population (mn.) 4.7; Lending Facility GRA; Access (SDR mn.) 19,466; Quota (SDR mn.) 1257.6; Budget Support (SDR mn.) 15,573; Budget Support (% access) 80; Budget Support (% quota) 1,238
  - Antigua & Barbuda — Population (mn.) 0.01; Lending Facility GRA; Access (SDR mn.) 67.50; Quota (SDR mn.) 13.5; Budget Support (SDR mn.) 67.50; Budget Support (% access) 100; Budget Support (% quota) 500
  - Kyrgyz Republic — Population (mn.) 5.5; Lending Facility PRGT/ECF; Access (SDR mn.) 67; Quota (SDR mn.) 88.8; Budget Support (SDR mn.) 67; Budget Support (% access) 100; Budget Support (% quota) 75

- Treasury evaluation criteria (Box 1):
  1. Does the State Treasury operate a main bank account at the central bank, through which all government transactions are processed?
  2. Is all central government expenditure authorized by the budgetary appropriation or other law?
  3. Is the main bank account at the central bank (and other possible authorized accounts) reconciled regularly?
  4. Are all central government transactions executed through the State Treasury properly accounted for, using clearly defined national accounting standards that are on major issues aligned with international standards such as International Public Sector Accounting Standards (IPSAS), and are all final accounts under the responsibility of the State Treasury produced in a timely fashion?
  5. Are the final accounts prepared by the State Treasury audited by an independent commercial or state audit institution, according to national standards aligned (on major issues) with international standards such as the International Standards on Auditing (ISA) and/or standards issued by the International Organization of Supreme Audit Institutions (INTOSAI), and are audit reports on the final accounts provided to parliament in a timely way?
  6. Are observations by the commercial and/or the state auditor addressed to the State Treasury to improve financial management processes taken on board systematically?
  7. Are adequate internal control procedures in place at the State Treasury to safeguard public resources, generate reliable financial reports, and comply with applicable laws and regulations?

### Evaluation of the pilots — key lessons
- Availability of information:
  - Bulk of information required to identify fiscal safeguards risks is already available where countries recently underwent comprehensive PFM diagnostic evaluations or had active PFM TA programs.
  - Two main diagnostic PFM evaluations: PEFA assessments and fiscal ROSCs/FTAs.
  - Of the 17 countries where programs provided for the use of Fund purchases for budgetary purposes, two-thirds have benefited from a PEFA assessment within the last six years; many others undertook a fiscal ROSC in the early or mid-2000s; and almost all have been regular users of Fund TA in PFM in recent years.
  - Annex I shows most questions in the safeguards questionnaire are covered by the PEFA and FTA frameworks.
  - Issues less well represented—particularly indicators on coverage and effectiveness of government banking arrangements and internal controls—will be considered for inclusion in the PEFA framework revision.
- Need for additional, country-specific information:
  - Diagnostic tools and TA reports provide a useful basis, but additional information needed to highlight fiscal safeguards risks can vary by country.
  - Multiple modes used in the five pilots indicate a “one-size-fits-all” approach is neither cost-effective nor justifiable.
- Broader PFM integrity matters:
  - Treasury operations focus is generally appropriate, but integrity of entire PFM system may be important because Fund resources are fungible and mingled with other funds.
  - Treasury functions are often decentralized across accounting, control, and financial reporting in advanced and middle-income countries; these nuances matter for risk identification.
- Technical assistance coverage (Table 2 summary):
  - PEFA and FTA coverage varies across countries receiving budget support.
  - PFM TA by FAD in the past 6 years categorized as High, Medium, or Low (definitions: High = more than 250 FTE days of TA; Medium = between 125-250 FTE days of TA; Low = less than 125 FTE days of TA).

### Examples of findings and recommendations (Table 3)
- Legal
  - Findings:
    - The budget law permits additional expenditure to be incurred through rules on supplementary budgets that are not adequately controlled by the treasury, and liberal use of special warrants.
  - Recommendations:
    - Amend the law to tighten the use of supplementary budgets and special warrants.
    - Reactivate the supplementary estimates process to ensure proper recording of all financial transactions and efficient utilization of public funds.
- Treasury and banking arrangements
  - Findings:
    - Inadequate information is available to the treasury on the balance of the many commercial bank accounts held by line ministries outside the treasury single account (TSA).
  - Recommendations:
    - Provide the treasury with on-line access to all commercial bank accounts.
    - Convert such accounts into sub-accounts under the TSA.
- Internal control
  - Findings:
    - To reduce the risk of payment arrears accumulation, the commitment control system needs to be extended to all types of expenditure and for all entities in the central government sector.
  - Recommendations:
    - Develop a comprehensive commitment control system that requires all expenditures to be recognized as commitments, and automates the commitment approval process.
- Fiscal monitoring and reporting
  - Findings:
    - Financial data is unreliable as bank reconciliation is a very slow process.
    - Lack of comprehensive data on revenues collected by the treasury and the own-revenues of line ministries.
    - No independent authority has been established to advise on accounting standards.
  - Recommendations:
    - Improve the comprehensiveness, reliability and timeliness of financial reports.
    - Establish a process for setting accounting standards based on IPSAS.
    - Disclose with financial statements a statement of accounting policies and expand supporting notes.
- Audit
  - Findings:
    - The role of the auditor general is not fully independent as recommended by international audit standards.
    - The internal audit function is weak.
  - Recommendations:
    - Strengthen the legal framework for external audit.
    - Establish internal audit units in all government agencies and build their capacity to conduct audits in line with international standards.

### The way forward — risk-based approach for fiscal safeguards assessments
- Core proposition:
  - Rely primarily on existing diagnostic tools and evaluations to identify fiscal safeguards risks for countries channeling a significant proportion of Fund resources to the budget, rather than requiring stand-alone fiscal safeguards assessment missions.
- Applicability threshold:
  - Approach applies to countries that receive exceptional access to Fund resources (more than 600 percent of quota) to address balance of payments needs and channel more than half of that support to the budget.
- Sequential approach (three cases):
  - First:
    - If a PEFA assessment or an FTA has been carried out within the past six years, review primarily based on relevant PEFA indicators or FTA practices/indicators, supplemented by recent TA reports and other publicly available information.
  - Second:
    - If no recent diagnostic assessment, countries could be encouraged to initiate a PEFA or an FTA; identifying resources could take time and shift the exercise into the next fiscal year.
  - Third:
    - If no PEFA or FTA within the last six years and no volunteering for one within a reasonable timeframe, or resources cannot be lined up, FAD would conduct an evaluation modeled on the pilot’s framework and questionnaire, drawing on available information and, in limited cases, a field visit.
- Reporting:
  - Staff reports to provide a summary description of fiscal safeguards risks prepared by FAD, highlighting any risks found and remedial measures in train.
- Budget and resources:
  - Additional costs to conduct the work are expected to be about $100,000 a year to compensate for staff time and travel for five or six assessments.
  - Most reviews can be completed through desk work, with complementary field trips in selected cases.
  - If “red flags” emerge (e.g., weak internal controls, large discrepancies in fiscal reports and government bank accounts), remedial measures could include well-targeted future TA.
- Policy review timing:
  - Safeguards policy is scheduled for review in 2015; this is an opportunity to assess the approach and consider amendments.

### Annex I — Coverage of fiscal safeguards criteria in PEFA and FTA frameworks
- Coverage of Fiscal Safeguards Criteria (as defined in Box 1):
  - 1. Main bank account at the central bank processing all government transactions?
    - Coverage in the PEFA Framework: Partial
    - Coverage in FTA: Partial
  - 2. All central government expenditure authorized by budgetary appropriation or other law?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 3. Main bank account (and other authorized accounts) reconciled regularly?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 4. Transactions executed through the state treasury using clearly defined national accounting standards and timely production of final accounts?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 5. Final accounts audited by an independent commercial or state audit institution in line with international standards and audit reports provided to parliament in a timely way?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 6. Auditor observations addressed to the state treasury systematically to improve financial management practices?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 7. Adequate internal control procedures in the state treasury to safeguard public resources, generate reliable financial reports, and comply with laws and regulations?
    - Coverage in the PEFA Framework: Partial
    - Coverage in FTA: Partial

*Source: REPORT ON FISCAL SAFEGUARDS PILOTS — EXECUTIVE SUMMARY (October 4, 2013).*

### EXECUTIVE SUMMARY

### EXECUTIVE SUMMARY

### INTRODUCTION
- This paper reports on the results of a pilot exercise on fiscal safeguards conducted by the Fiscal Affairs Department (FAD) during FY2013.
- The exercise responds to calls from many Directors to highlight fiscal safeguards risks in cases where a substantial portion of Fund resources for balance of payments support is channeled to state treasuries for budget purposes.
- Pilot fiscal safeguards exercises were conducted for five countries: Antigua and Barbuda, Cyprus, Greece, Ireland, and Kyrgyz Republic.
- The paper draws lessons from the five pilots and proposes an approach to review fiscal safeguards risks where a member channels a significant portion of Fund resources to the state treasury for budget purposes; it does not provide recommendations for a full-fledged fiscal safeguards assessment.

### BACKGROUND
- The safeguards policy applies to Fund resources made available to member countries in support of programs that address their balance of payments needs; the domestic counterpart of disbursements may be made available for budgetary purposes.
- Recent programs have sharply increased the share of Fund financing made available for budget purposes, accounting for 87 percent of GRA resources and 37 percent of PRGT resources at end-May 2013.
- The 2010 review of the Fund’s Safeguards Assessment Policy encouraged staff to highlight fiscal safeguards risks but did not request a full methodology comparable to central bank safeguards assessments.
- A pilot exercise for fiscal safeguards was launched by FAD in FY2013 to cover several large budget financing cases over 12 months; participation was voluntary and confidentiality procedures similar to central bank safeguards applied.

### THE PILOTS
- Five countries participated (mission timing in parentheses): Antigua and Barbuda (March 2013), Cyprus (May 2013), Greece (February 2013), Ireland (June 2012), Kyrgyz Republic (April 2013).
- Countries were chosen in consultation with area departments based on: large share of budgetary use of Fund financing; variation in size, income, and region; and authorities’ willingness to volunteer and provide logistical support.
- Methodology:
  - Desk review of documents, including recent PFM diagnostic assessments (PEFA, FTA/fiscal ROSC) and FAD PFM TA reports and other organizations’ work.
  - Field work lasting two to three days by one or two FAD staff or experts to gather supplementary information and discuss results with authorities.
  - In some cases, work combined with FAD PFM TA missions or inspection of an advisor in the field.
  - Missions left a draft report with authorities for review.
- Costs:
  - Total costs associated with the exercise (staff and contractual time and travel) amounted to about US$120,000.
  - Cost per assessment varied between US$5,000 and US$35,000.

- Table 1 summary (as of May 31, 2013):
  - Cyprus — Population (mn.) 0.9; Lending Facility GRA; Access (SDR mn.) 891; Quota (SDR mn.) 158.2; Budget Support (SDR mn.) 891; Budget Support (% access) 100; Budget Support (% quota) 563
  - Greece — Population (mn.) 11.3; Lending Facility GRA; Access (SDR mn.) 23,785; Quota (SDR mn.) 1101.8; Budget Support (SDR mn.) 23,785; Budget Support (% access) 100; Budget Support (% quota) 2,159
  - Ireland — Population (mn.) 4.7; Lending Facility GRA; Access (SDR mn.) 19,466; Quota (SDR mn.) 1257.6; Budget Support (SDR mn.) 15,573; Budget Support (% access) 80; Budget Support (% quota) 1,238
  - Antigua & Barbuda — Population (mn.) 0.01; Lending Facility GRA; Access (SDR mn.) 67.50; Quota (SDR mn.) 13.5; Budget Support (SDR mn.) 67.50; Budget Support (% access) 100; Budget Support (% quota) 500
  - Kyrgyz Republic — Population (mn.) 5.5; Lending Facility PRGT/ECF; Access (SDR mn.) 67; Quota (SDR mn.) 88.8; Budget Support (SDR mn.) 67; Budget Support (% access) 100; Budget Support (% quota) 75

- Criteria used in evaluating the state treasury (from Box 1):
  1. Does the State Treasury operate a main bank account at the central bank, through which all government transactions are processed?
  2. Is all central government expenditure authorized by the budgetary appropriation or other law?
  3. Is the main bank account at the central bank (and other possible authorized accounts) reconciled regularly?
  4. Are all central government transactions executed through the State Treasury properly accounted for, using clearly defined national accounting standards that are on major issues aligned with international standards such as International Public Sector Accounting Standards (IPSAS), and are all final accounts under the responsibility of the State Treasury produced in a timely fashion?
  5. Are the final accounts prepared by the State Treasury audited by an independent commercial or state audit institution, according to national standards aligned (on major issues) with international standards such as the International Standards on Auditing (ISA) and/or standards issued by the International Organization of Supreme Audit Institutions (INTOSAI), and are audit reports on the final accounts provided to parliament in a timely way?
  6. Are observations by the commercial and/or the state auditor addressed to the State Treasury to improve financial management processes taken on board systematically?
  7. Are adequate internal control procedures in place at the State Treasury to safeguard public resources, generate reliable financial reports, and comply with applicable laws and regulations?

### EVALUATION OF THE PILOTS — KEY LESSONS
- Availability of information:
  - The bulk of information required to identify fiscal safeguards risks is already available in countries that recently underwent comprehensive PFM diagnostic evaluations or where the Fund had an active PFM TA program.
  - The two main diagnostic PFM evaluations are the PEFA assessments and the fiscal ROSCs/FTAs.
  - Of the 17 countries where programs provided for the use of Fund purchases for budgetary purposes, two-thirds have benefited from a PEFA assessment within the last six years; many others undertook a fiscal ROSC in the early or mid-2000s; and almost all have been regular users of Fund TA in PFM in recent years.
  - Annex I shows that most questions in the safeguards questionnaire are covered by the PEFA and FTA frameworks.
  - Issues less well represented—particularly indicators on the coverage and effectiveness of government banking arrangements and internal controls—will be considered for inclusion in the PEFA framework revision.

- Need for additional, country-specific information:
  - While diagnostic tools and TA reports provide a useful basis, additional information needed to highlight fiscal safeguards risks can vary by country.
  - Different modes used in the five pilots indicate multiple ways of obtaining supplementary information; a “one-size-fits-all” approach is neither cost-effective nor justifiable and may impose undue burden on authorities.

- Broader PFM integrity matters:
  - Focusing on treasury operations is generally appropriate, but the integrity of a country’s entire PFM system may also be important.
  - Fund resources are fungible and mingled with other funds used inside and outside the central government budget; propriety and efficiency depend on all aspects of the budget and financial management system, not only treasury functions.
  - In many advanced and middle-income countries, treasury functions are decentralized across accounting, control, and financial reporting conducted by line ministries and other entities; these nuances must be understood when identifying fiscal safeguards risks.

- Technical assistance coverage (Table 2 summary):
  - PEFA and FTA coverage varies across countries receiving budget support.
  - PFM TA by FAD in the past 6 years categorized as High, Medium, or Low (definitions: High = more than 250 FTE days of TA; Medium = between 125-250 FTE days of TA; Low = less than 125 FTE days of TA).

### THE WAY FORWARD — RECOMMENDED APPROACH
- For countries receiving exceptional access to Fund resources for balance of payments support and channeling more than half of that support to the budget, the paper recommends:
  - First, where a country has undergone a PEFA or FTA within the past six years, the review of fiscal safeguards would be based in the first instance on the relevant findings of those evaluations, supplemented by information from recent TA reports and other publicly available sources.
  - Second, where countries have not undergone one of these diagnostic assessments in the last six years, the authorities could be encouraged to initiate a PEFA assessment or an FTA within a reasonable timeframe.
  - Third, when a country does not volunteer for a PEFA or FTA in the foreseeable future, FAD would conduct a review based on information from FAD PFM TA reports, other publicly available sources, and, in very limited cases, a dedicated mission to the country.
  - In all instances, staff reports would provide a brief summary description of fiscal safeguards risks.

- Cost estimate:
  - The additional costs to conduct this work are expected to be about $100,000 a year.

- Implementation note:
  - The paper does not propose a full safeguards assessment framework equivalent to that applied to central banks, and participation in the pilot was voluntary.

*Source: REPORT ON FISCAL SAFEGUARDS PILOTS — EXECUTIVE SUMMARY (October 4, 2013).*

### 7. Table 3 provides some examples of the findings and recommendations of the pilot

### Table 3 provides some examples of the findings and recommendations of the pilot exercises

### Examples of findings and recommendations by theme
- Legal
  - Findings:
    - The budget law permits additional expenditure to be incurred through rules on supplementary budgets that are not adequately controlled by the treasury, and liberal use of special warrants.
  - Recommendations:
    - Amend the law to tighten the use of supplementary budgets and special warrants.
    - Reactivate the supplementary estimates process to ensure proper recording of all financial transactions and efficient utilization of public funds.

- Treasury and banking arrangements
  - Findings:
    - Inadequate information is available to the treasury on the balance of the many commercial bank accounts held by line ministries outside the treasury single account (TSA).
  - Recommendations:
    - Provide the treasury with on-line access to all commercial bank accounts.
    - Convert such accounts into sub-accounts under the TSA.

- Internal control
  - Findings:
    - To reduce the risk of payment arrears accumulation, the commitment control system needs to be extended to all types of expenditure and for all entities in the central government sector.
  - Recommendations:
    - Develop a comprehensive commitment control system that requires all expenditures to be recognized as commitments, and automates the commitment approval process.

- Fiscal monitoring and reporting
  - Findings:
    - Financial data is unreliable as bank reconciliation is a very slow process.
    - There is a lack of comprehensive data on revenues collected by the treasury and the own-revenues of line ministries.
    - No independent authority has been established to advise on accounting standards.
  - Recommendations:
    - Improve the comprehensiveness, reliability and timeliness of financial reports.
    - Establish a process for setting accounting standards based on IPSAS.
    - Disclose with financial statements a statement of accounting policies and expand supporting notes.

- Audit
  - Findings:
    - The role of the auditor general is not fully independent as recommended by international audit standards.
    - The internal audit function is weak.
  - Recommendations:
    - Strengthen the legal framework for external audit.
    - Establish internal audit units in all government agencies and build their capacity to conduct audits in line with international standards.

*Source: Fund staff.*

### The way forward: risk-based approach for fiscal safeguards assessments
- Core proposition:
  - Rely, in the first instance, on existing diagnostic tools and evaluations to identify fiscal safeguards risks for countries that channel a significant proportion of Fund resources to the budget, rather than requiring stand-alone fiscal safeguards assessment missions.
- Applicability threshold:
  - The risk-based approach would apply to countries that receive exceptional access to Fund resources (more than 600 percent of quota) to address their balance of payments need and channel more than half of that support to the budget.
- Sequential approach (three cases):
  - First:
    - If either a PEFA assessment or an FTA has been carried out within the past six years, the fiscal safeguards risk exercise would primarily be based on an evaluation by FAD staff of the relevant PEFA indicators or FTA practices/indicators, supplemented by recent TA reports and other publicly available information.
  - Second:
    - If a recent diagnostic assessment has not taken place, countries could be encouraged to initiate a PEFA or an FTA, given that both assessment tools are strictly voluntary. Identifying resources to undertake such assessments, however, could take time and might shift the exercise into the next fiscal year.
  - Third:
    - When a country has not carried out either a PEFA assessment or an FTA within the last six years and is not volunteering for one within a reasonable timeframe, or if resources for such assessments cannot be lined up in the near future, FAD would conduct an evaluation of fiscal safeguards risks modeled on the framework and questionnaire used in the pilot exercise. Such an evaluation would draw on available information, including past TA reports and other documentary sources, supplemented by a field visit in cases with limited recent information.
- Reporting:
  - In all such cases, staff reports would provide a summary description of fiscal safeguards risks. The description, to be prepared by FAD, would highlight any fiscal safeguards risks found, together with a description of remedial measures in train to address those risks.
- Budget and resource implications:
  - The additional costs to conduct the work are expected to be about $100,000 a year to compensate for staff time and travel costs for five or six assessments; the funding for this exercise would compete with other demands on the FY2014/15 budgets.
  - Most reviews can be completed solely based on desk work, with complementary field trips in selected cases.
  - If “red flags” emerge (e.g., weak internal controls, or large discrepancies in data derived from fiscal reports and government bank accounts), these could be addressed through appropriate remedial measures, including well-targeted future TA to provide advice to the relevant country on the measures required to achieve the necessary improvements in its PFM systems.
- Policy review timing:
  - The safeguards policy is scheduled for review in 2015. This could be an opportune time to review whether the approach suggested above is working satisfactorily, and whether any amendments need to be made to it.

*Source: Fund staff.*

### Annex I — Coverage of fiscal safeguards criteria in PEFA and FTA frameworks
- Fiscal Safeguards Criteria coverage (as defined in Box 1)
  - 1. Does the state treasury operate a main bank account at the central bank, through which all government transactions are processed?
    - Coverage in the PEFA Framework: Partial
    - Coverage in FTA: Partial
  - 2. Is all central government expenditure authorized by the budgetary appropriation or other law?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 3. Is the main bank account at the central bank (and other possible authorized accounts) reconciled regularly?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 4. Are all central government transactions executed through the state treasury using clearly defined national accounting standards, and are all final accounts under the responsibility of the state treasury produced in a timely fashion?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 5. Are all final accounts prepared by the state treasury audited by an independent commercial or state audit institution in line with international standards, and are audit reports on the final accounts provided to parliament in a timely way?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 6. Are observations by the commercial and/or state auditor addressed to the state treasury to improve financial management practices taken on board systematically?
    - Coverage in the PEFA Framework: Substantial
    - Coverage in FTA: Substantial
  - 7. Are adequate internal control procedures in place in the state treasury to safeguard public resources, generate reliable financial reports, and comply with applicable laws and regulations?
    - Coverage in the PEFA Framework: Partial
    - Coverage in FTA: Partial

*Source: FAD staff and PEFA Secretariat, Public Financial Management: Performance Measurement Framework, January 2011 (revised). 1/ As defined in Box 1.*

---


_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2013/_100413a.pdf_