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External performance audit of the Broadcasting Council – what it entails and why it is needed

02 June 2020
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At the end of May, a draft law was registered in the Parliament, which allows the conduct of performance audit missions at the Broadcasting Council (BC) and the Competition Council (CC) by foreign companies. Its authors claim that the adoption of this document will allow the disbursement of an installment from the financial aid of the European Union and that its implementation will provide a complex picture of the efficiency of these authorities.  
 
According to the draft law, the audit missions at the BC and the CC would be carried out based on a decision of the Parliament. A specialized parliamentary commission would be responsible for the audit procedure, and the performance report would be examined by the Parliament within three months of its submission.

One of the authors of the draft law, the MP Sergiu Litvinenco, told Media Azi that the audit is necessary for two reasons, and one of them is that it is one of the European Union conditions for disbursement of 30 million euros. “Beyond that, the audit is necessary in order to see the real situation in these two institutions. We know that the situation is disastrous, because neither the CC nor the BC fulfill their mission provided by law, for which they had been created. The audit performed by someone from abroad could provide an objective picture of the situation,” the MP explained.

The explanatory note to the draft law states that the only way to monitor the work of the BC currently is its obligation to submit annual activity reports to the Parliament, a procedure that ends only with their approval. The authors of this document find it insufficient for an “objective, fair, and transparent assessment of the Council’s performance.”

Auditors from abroad

Sergiu Litvinenco said that the essence of an ad hoc performance audit consists in the complex verification of the way in which a state institution fulfills its mission provided by law. “It is not just a financial audit, but a complex performance audit that will verify or analyze how these institutions fulfill the mission for which they were created. We believe that only an independent performance audit, conducted by experts selected according to a transparent procedure, will reveal deficiencies in the work of the two entities,” the MP added.

He noted that according to the draft law and to EU’s conditions, the audit must be carried out by companies or auditors from abroad, “for the credibility of this work, among other reasons. It is not an audit performed by the Court of Accounts, but an external audit.”

It could serve as a reason for dismissing the members of the BC

Petru Macovei, executive director of the Association of Independent Press, is convinced that Moldova needs such audit missions on a regular basis in order to see whether state institutions really correspond to the assigned functions.
“The experience of Moldova shows the exact opposite, and it is good to have this audit as a form not of pressure, but of evaluation of these regulators, in order to be able to draw proper conclusions. An audit showing, let’s say, the inactivity or bad faith in the management of these authorities could serve as a basis for certain conclusions, including for dismissal of their members,” Macovei underlined.

In his opinion, foreign auditors are necessary because the duties of the Court of Accounts are not efficient enough and because there still is political subordination in some state institutions. At the same time, the external audit may also be used to assess the independence of these authorities in making certain decisions.
 
“Let’s focus on the quality of the BC members”

In turn, the executive director of the Electronic Press Association of Moldova (APEL) Ion Bunduchi argued that in a democratic society any institution funded from public money must be subject to control in such a way that taxpayers can judge on the correctness and efficiency of spending the money from taxes. “The control, it its turn, must be carried out according to clear and transparent rules, in order to avoid possible settlements of accounts,” Bunduchi said.

However, he recalled that in Moldova there is already an authority entitled to conduct performance audits – the Court of Accounts, and he added that MPs could evaluate the work of the Council ex officio, through a specialized commission.“Ultimately, a performance audit must give credible results, and such results come only when the audit it preceded by a complicated period of preparation, with many stages, with planning, with audit criteria, with the elaboration of a methodology that enables obtaining relevant audit evidence, with proper documentation on the audit, with a regulation for ad hoc audits, and so on, let alone the team of auditors who must have the best qualification possible,” the expert argued.

The executive director of APEL believes that it is necessary “to focus on the quality of the BC members, who are appointed by the Parliament.” “Maybe it’s time for them to be appointed in the spirit of the current law, so even the Parliament could have more confidence in those it appoints,” concluded Ion Bunduchi.