Document 1 (2012-2013) The Office of the Auditor General’s annual financial audit and control for the budget year 2011 was submitted to the Storting on 25 October.
Unauditable financial statements
The Auditor General takes a serious view of the fact that entities are still preparing financial statements that cannot be audited due to lack of documentation.
- This is particularly serious when it concerns agencies with deficiencies that have been reported to the Storting several times before, says Kosmo.
This year too, the report outlines problems at agencies that have not established adequate systems for identifying and assessing the risk of impaired goal attainment.
- The OAG has repeatedly reported on the lack of progress in the implementation of risk management. It is important that ministries and subordinate agencies adopt and can document that management systems are used to ensure goal attainment, says Kosmo.
Well-functioning IT solutions are a prerequisite for better interaction between the various public administration actors, and for better quality in administrative procedures. The report cites that while the upgrading and modernisation of various systems is under way, manual and resource-intensive controls are being carried out to compensate for the weaknesses. The OAG questions whether the compensating controls are sufficient to reduce the magnitude of errors and omissions.
- It is important that the ministries and agencies give priority to implementing the renewal projects and ensuring satisfactory progress, says the auditor general.
For many years the OAG has been reporting shortcomings and deficiencies in public sector compliance with procurement regulations, and concludes that there is still room for improvement.
Certain areas of which the OAG is particularly critical
Norwegian Labour and Welfare Service (NAV) benefits
The OAG takes a serious view of the fact that since its establishment in 2006 NAV has received significant comments on the quality of its processing of various benefits under the National Insurance Act. The OAG takes a serious view of the scale of errors and emphasises that even minor errors can have a major impact on the individual user. Procedural quality also affects the quality of the underlying transactions to the accounts. In addition, there are significant challenges in accounting and financial management and information security. Efforts to remedy the shortcomings are in progress, but will take a long time.
Processing time in county child welfare boards
Since 2008 the OAG has commented on disturbingly long case processing times in decisions concerning the placement of children and young people outside the home. The OAG takes a serious view of the fact that there have been no improvements in the period, pointing out that long processing times lasting several years are unacceptable.
Ministry of Government Administration, Reform and Church Affairs’ governance
For several years, the OAG has discussed weaknesses in the Ministry's management of county governor offices and the Church Property Endowment Fund. The audit shows that neither the Data Inspectorate, Directorate of Public Construction and Property, Government Administration Services nor diocesan councils have implemented adequate risk analyses in accordance with the regulations.
The OAG is concerned whether Altinn, the Norwegian public reporting portal, will meet the objectives and stay within the budget framework that was the basis for the mandate and the Storting’s decisions and prerequisites for Altinn. The OAG takes a serious view of the fact that the Ministry has not initiated changes to the overarching contingency plans for Altinn following the critical events of recent years in connection with the distribution of tax returns.
Information security in the National Police Directorate
The OAG is gravely concerned that for the fourth year in a row the National Police Directorate has received an audit letter with comments. It is highly reprehensible that there are still weaknesses in information security in the police services. The OAG takes a dim view of the fact that the police districts have had inadequate follow-up and implementation of key decisions, policies and directives regarding information security.
Bioforsk – accounting deficiencies
The OAG cannot verify the financial statements for Bioforsk. The OAG finds it highly reprehensible that Bioforsk has adopted a computer system that includes accounting, budgeting, financing and project management without testing the system and without the existence of system documentation. The consequence is that Bioforsk cannot document the basis for the financial statements. The OAG has also commented on Bioforsk’s financial statements for the four previous years.
Norwegian National Rail Administration – lack of traceability and documentation
The OAG cannot verify the Norwegian National Rail Administration’s financial statements. Over the past year the Administration has had a lack of traceability and inadequate conditions for effective internal controls in accordance with the financial management regulations. Several of these accounting issues were also raised in 2010. The OAG finds it reprehensible that the Administration has not had an overview of its purchase agreements, and that it has been difficult to find documentation that procurement rules have been complied with and for the control routines that existed.
Armed Forces – several issues
The OAG takes a serious view of the fact that many of the issues raised in connection with the Armed Forces have also been the subject of comments in previous years. They include in particular materiel management and materiel accounting along with challenges relating to expertise and capacity in several key areas.
The document can be downloaded via the link on the right.
The deferral of public access to documents prepared by or for the Office of the Auditor General in connection with Document 1 (2012-2013), cf. the Act relating to the Office of the Auditor General section 18 second paragraph, is hereby set aside.