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16 October 2017, 18:05

Government oversight over private sector in Belarus to focus on prevention

MINSK, 16 October (BelTA) – The interference of oversight and auditing agencies in the operation of commercial entities in Belarus will be minimized. Belarus President Alexander Lukashenko signed decree No.376 on measures to improve auditing (oversight) activities on 16 October with this goal in mind, the press service of the Belarusian leader told BelTA.

The focus in efforts of government agencies will be shifted to prevention. Instead of audits more technical and verification measures will be taken. If faults are found, punishment will not be exacted if the subject at fault fixes the shortcomings.

Moving away from scheduled audits

The document provides for moving away from regular scheduled audits, which allow government inspectors to audit a commercial entity without compelling reasons and without obvious violations. Scheduled audits will be replaced with random checks, which allow auditing a company only if valid reasons are available such as repeated violations and results of a checklist analysis.

The list of reasons that can trigger unscheduled audits will be decreased. If an unscheduled audit is authorized, the inspectors will focus only on the specific facts and circumstances that have triggered the audit.

Inspections will no longer be triggered using the materials that law enforcement agencies are investigating. Inspections can be authorized only if a criminal case has been opened.

Business must go on

Auditors will not be able to suspend the operation of the company being audited, its departments, plant and equipment, or manufacturing facilities. The head of the company will be the only one to decide on suspending business operations on the basis of recommendations from the auditors. The head of the company will bear full responsibility (including criminal responsibility) for addressing the shortcomings the audit has revealed.

Administrative responsibility for auditors

Auditors will face administrative responsibility for blatant violations in the course of audits (failure to make a note about the audit in the audit registry or launching an audit without valid reasons). Officials of the auditing agency will face a fine of up to 30 base amounts for such failures.

Plans for an interagency council

An interagency council will be created under the aegis of the State Control Committee to analyze the current state of auditing and oversight practices in Belarus. If negative trends are detected, the council will be authorized to tell the agencies at fault to fix their shortcomings. If the recommendations fall on deaf ears, reports will be forwarded to the Council of Ministers and the head of state.

The institutional control system in for a reform

The institutional control system will be reformed. These services will be repurposed to audit (analyze) and take measures to improve the performance of enterprises and companies. In essence for government agencies, including municipal government agencies, these services will serve as instruments for the owner to ensure the effective operation of subordinate organizations.

Narrower auditing scope

The list of auditing agencies and their spheres of interest will be optimized. One third of the auditors will lose their power to carry out audits. The number of spheres to audit (inspect) will be nearly halved.

The decree's implementation is supposed to bring about a more rational system of state oversight. It will improve the transparency component in the operation of state auditing (oversight) agencies and will ease up the burden of unwarranted audits for Belarusian commercial entities.

BelTA reported earlier that on 22 September the head of state heard out a report on the draft decree from Chairman of the State Control Committee of Belarus Leonid Anfimov. Back then Alexander Lukashenko said: “We have discussed it and agreed that we will move away from punishment in our auditing efforts in favor of prevention. We will focus on preventing violations. We will phase out regular audits and will move on to random checks. I've always demanded it: you can audit whoever you like but you need reasons, specific grounds for taking a closer look at a businessman, an individual or a company. If you have these reasons, you can go ahead with the audit.”

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