For the first time ever in the long history of Russia we are witnessing the existence and successful functioning of the parliamentary budget control system, created in January 1995 and working independently from the traditional state financial control.
This independent control is exercised by the Accounts Chamber of the Russian Federation, a standing financial control agency, which, according to Article 101 of the Constitution of the Russian Federation, is "to exercise control over fulfilment of the federal budget".
It is necessary to stress, that the Accounts Chamber enjoys full organisational and functional independence, necessary for effective execution of its tasks. It means, that nobody from outside the Chamber may interrupt the audit, carried out by the Chamber, intervene into this process or alter the results and conclusions of audit reports. The independent status of the Chamber is further strengthened by its financial independence, which means, that resources for the upkeeping of the Chamber are secured by a separate federal budget item.
In-case of dissolution of the National Parliament this even shall not lead to the interruption of the activities of the Accounts Chamber.
Furthermore, the Law guarantees the independence of the Chairman, Vice-Chairman and twelve auditors - members of the Collegium (governing board) of the Chamber: they are appointed and approved by the Parliament for a term of 6 years, which exceeds the mandate of the Parliament itself.
Criminal charges may be attributed to these persons only with the consent of the Chamber of the Federal Assembly, which has appointed them. Equally, they may be dismissed from their posts by a vote in favour of such a resolution, passed by two third majority of the total number of members of the Chamber, which has appointed them.
The Federal Law "On the Accounts Chamber of the Russian Federation" came in force on January 14, 1995. Its status, powers, functions and obligations are generally corresponding to the Lima Declaration of INTOSAI.
In April 1995 the Federal Assembly of the Russian Federation established the Collegium of the Accounts Chamber, comprising 14 members. The Chairman and six auditors were appointed by the State Duma, the lower chamber of the Federal Assembly, Vice-President and other 6 auditors - by the Council of
Federation, the upper chamber of the Federal Assembly. The Accounts Chamber began its activities in April, 1995.
The principal functions of the Chamber are:
Aside from this the Chamber executes some other duties, which supplement and broaden its control powers of a traditional supreme audit body.
In particular, the Chamber presents quarterly reports to the Parliament on the state of execution of the federal budget, which contains comparative analysis of the factual income-expenditure parts of the budget in relation to the established indicators, fixed in the law on the federal budget for the current year.
Starting from autumn of 1997 the Chamber presents monthly reports to the upper chamber of the Parliament - the Council of Federation with the analysis, concerning the budget execution on the level of the Subjects of the Russian Federation.
The Chamber carries out expertise and presents its conclusions on the drafts of the federal budget, draft laws on other financial and budget problems, tabled to the State Duma, drafts of international conventions, treaties and agreements, which might pose legal consequences for the federal budget, drafts of federal projects and programs and other documents, related to the sphere of the federal budget.
The Accounts Chamber has full authority to exercise control over all state bodies (including their administrative apparatus) and institutions of the Russian Federation as well as over the federal extra-budgetary funds of the Russian Federation: the Pension Fund, the Social Security Fund, the National Employment Fund, the Federal Fund of Compulsory Medical Insurance. In addition, the control powers of the Accounts Chamber spread over local self-government administrations, enterprises, organisations, banks, insurance companies and other financial and credit institutions, their unions, associations and other alliances irrespective of their types and forms of ownership, provided they receive, remit, use federal budget resources, use or manage the federal property or enjoy tax, customs and other exemptions and privileges, granted by the federal law.
Similarly the authority of the Accounts Chamber extends to financial control powers over political parties, trade unions and other non-state and non- commercial organisations and funds with regard of their economic and financial activities.
The Chamber is entitled to send its opinions, resulting from its audit arrangements, to the management of the audited organisations so as the auditees would eliminate the revealed irregularities and take measures to detect the culprits. Also the Chamber has the right to issue mandatory orders to them.
The Accounts Chamber of the Russian Federation consists of Chairman of the Accounts Chamber, Deputy Chairman, auditors and Office.
Control and auditing activity is subdivided into 12 main branches, headed by appropriate responsible auditors - members of the Collegium. Every auditor has a team of inspectors, engaged in control and audit inspections in their respective areas (around 50 inspectors in each branch).
Inspectors of the Chamber play the key role in execution of control and audit arrangements. Findings and opinions, resulting from the inspections, are the legal basis for practically all further documents, issued by the Chamber as far as its main functions are concerned.
In accordance with the legislation in force inspectors of the Accounts Chamber are responsible for authenticity of results of checks and audits conducted by them.
On the other hand, the legislation foresees protection of employees of the Accounts Chamber from pressure, which can be exerted with the aim to prevent them from exercising their service duties and obligations. The current criminal code also includes a special section, that determines sanctions for withholding and concealing from the Chamber's inspectors documents, required for the audit.
The Accounts Chamber doesn't have regional offices throughout the territory of the Russian Federation. For this reason it is desirable and sometimes imperative to ensure collaboration with the regional audit bodies. In order to establish such collaboration the Accounts Chamber has concluded appropriate agreements with a number of regional control agencies and is going to further develop this practice.
At the same time the practice has revealed certain shortcomings, stemming with the federal status of the Chamber. The results of the activity of the Chamber in 1995-1996 show the necessity to make amendments into current Federal Law "On the Accounts Chamber of the Russian Federation", which would envisage
the right of the Chamber to create its regional offices throughout Russian. This would enable us to decrease the cost of audit in regions and raise the efficiency of the Chamber's work. Taking into account the positive international experience in this sphere, the Accounts Chamber has submitted to the Parliament a draft law, envisaging creation of regional offices of the Accounts Chamber throughout the country.
Like any control body in a traditional period, the Chamber is facing quite a complicated task of providing functional effectiveness and required objectivity and, at the same time, evading external pressure on the part of forces, interested in the results of its control activity. The current Federal Law "On the Accounts Chamber of the Russian Federation" establishes conditions for successful tackling this problem. This is achieved by flexible combination of principles of centralised administration with collegiate approach in governance of the Accounts Chamber. The Law determines the competence of the Chairman, Vice-Chairman, auditors and the Collegium of the Chamber. For example, matters of personnel and staffing are in the competence of the Chairman and planning of activities of the Chamber is the responsibility of the Collegium.
Further, the auditors enjoy wide-range powers and freedom in their current day-to-day work, related to the respective sectors, which is stipulated in the special section of the Law.
This system enables the Chamber of the Accounts to operate successfully in complicated conditions of economic and political changes and transitions in Russia.
During its existence the Chamber has carried out in all sectors, where is operates, over 100 audits, embracing more than 3000 units, organisations, etc., including management bodies of the Subjects of the Russian Federation.
As a result of this we have discovered serious irregularities and infringements in the financial activities on different levels, resulting in negative impact on the execution of the federal budget, the Chamber has issued 800 reports and findings and around 70 orders to the management of enterprises, bodies and organisations. In 80 cases the Chamber has submitted the materials of audits to the law-enforcement bodies and the Prosecutor-General's Office.
The estimated general losses, discovered by the Accounts Chamber, constitute 72.5 trillion rubbles (about 12.1).
Due to measures, undertaken by the Chamber to prevent breaches of financial discipline at the audited objects, around 2 trillion 259 billion rubbles were returned to the federal budget.
Materials of all audit reports, prepared by the Accounts Chamber, are submitted to both chambers off the National Assembly.
According to the article 32 of the Federal Law "On the Accounts Chamber of the Russian Federation" the Accounts Chamber maintains contacts with accounts chambers and control agencies and bodies of parliamentary control of foreign countries and international associations thereof.
In 1995 The Accounts Chamber of the Russian Federation joined the INTOSI and EUROSAI and since that time took part in a number of events, organised by them, including the III Congress of the EUROSAI (Parague, 1996) and XV INCOSAI Congress (Cairo, 1995).
In July 1996 the Chamber became the member of the ASOSAI.
Our representatives are participating in a number of events, carried out within the framework of the activities of this authoritative and prominent organisation, among them the 7th Assembly and 6th International Seminar of ASOSAI in Jakarta, Seminar on Electronic Data Processing (EDP) in the Republic of Korea, Seminar on the Audit of Privatisation in Indonesia, the ASOSAI Workshop in Japan, etc.
We are actively developing our bilateral contacts with the SAIs of India, China, Republic of Korea, Kyrgyz Republic, Japan and other ASOSAI members.
We are convinced, that further development of international cooperation among Asian SAIs both on bilateral and multilateral basis will be useful for all of us, members of the ASOSAI.