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FOREWORD It Is an Honour for Me to Present This Compendium Which FOREWORD FOREWORD It is an honour for me to present this compendium which includes papers, practical information and proposals for combating fraud and corruption based on experience of the Supreme Audit Institutions (SAIs) in Central, Eastern Europe and Asia. The book was prepared upon the results of the EUROSAI International Conference “The Role of Supreme Audit Institutions in Fighting Against Fraud and Corruption” hosted by the Accounting Chamber of Ukraine on September 1921, 2006 in Kyiv. The EUROSAI event was attended by 61 participants from 24 SAIs among which were present Presidents of 16 SAIs. The participants discussed the following subthemes: • Subtheme I: The Role of SAIs in the National System Development of Fighting Against Fraud and Corruption; • Subtheme II: Peculiarities of SAIs Cooperation with the Law Enforcement Bodies during Exposure and Prevention of Fraud and Corruption; • Subtheme III: The Practice of SAIs in Implementation Transparency and Publicity in the Field of Fighting Against Fraud and Corruption. The Conference was supported by the Parliament of Ukraine, the Cabinet of Ministries of Ukraine and by the number of Ukrainian government authorities which participated in this event. I would like to pass special thanks to all of my colleagues, Heads of the SAIs for their interest in the Conference and willingness to share experience and modern techniques in fighting against fraud and corruption. I am very pleased that the initiative of the Accounting Chamber of Ukraine received great feedback among the EUROSAI community. I am deeply convinced that this event stimulated and consolidated efficient collaboration between SAIs and that approved Recommendations will further facilitate applying common actions towards combating such negative phenomena as fraud and corruption. Dr. Valentyn Symonenko Chairman of the Accounting Chamber Ukraine 1 THE ACCOUNTING CHAMBER OF UKRAINE OPENING STATEMENT OF THE CHAIRMAN OF THE ACCOUNTING CHAMBER OF UKRAINE DR. VALENTYN SYMONENKO Dear Ladies and Gentlemen, Dear colleagues, Dear friends, Let me as the Chairman of the Accounting Chamber of Ukraine welcome you on the ancient Kyiv´s land in the Ukrainian House with the Saint Prince Volodymyr soaring up nearby. I would like to express my sincere greetings to you, delegates of the International Conference “The Role of Supreme Audit Institutions in Fighting Against Fraud and Corruption” held under auspices of the European Organization of Supreme Audit Institutions (EUROSAI) with direct involvement of INTOSAI. This conference has already become important event for the Ukrainian social and political life. Representatives of different countries pay much interest and attention to it. I am glad to welcome and express gratitude to the Chairman of the Verkhovna Rada of Ukraine Mr. Oleksandr Moroz for his participation in our conference. I would also like to express sincere gratitude to the Chairman of the INTOSAI Governing Board, the President of the State Audit Office of Hungary Dr. Árpád Kovács; VicePresident of EUROSAI, the President of the Supreme Chamber of Control of Poland Mr. Mirosław Sekuła for their contribution to the organization of the conference; and the Chairman of the Accounts Chamber of the Russian Federation Mr. Sergey Stepashin, who was at the forefront of our conference. On behalf of the Accounting Chamber of Ukraine let me greet the delegations of Supreme Audit Institutions that arrived to participate in the conference: • delegation of the Chamber of Accounts of the Republic of Azerbaijan; • delegation of the State Supreme Audit of Albania; • delegation of the Chamber of Control of the National Assembly of the Republic of Armenia; 2 OPENING STATEMENT • delegation of the Committee of State Control of the Republic of Belarus; • delegation of the National Audit Office of Bulgaria; • delegation of the National Audit Office of the United Kingdom; • delegation of the State Audit Office of Hungary; • delegation of the Chamber of Control of Georgia; • delegation of the National Audit Office of Denmark; • delegation of the European Court of Auditors; • delegation of the Accounts Committee for Control over Execution of the Republican Budget of the Republic of Kazakhstan; • delegation of the Accounts Chamber of the Kyrgyz Republic; • delegation of the Sate Audit Office of Latvia; • delegation of the State Control of Lithuania; • delegation of the Court of Audit of the Republic of Moldova; • delegation of the Netherlands Court of Audit ; • delegation of the Office of the Auditor General of Norway; • delegation of the Supreme Chamber of Control of Poland; • delegation of the Accounts Chamber of the Russian Federation; • delegation of the Supreme Audit Office of the Slovak Republic; • delegation of the Committee of the State Financial Control of the Republic of Tajikistan; • delegation of the Supreme Audit Office of the Czech Republic; • delegation of the National Audit Office of Sweden; • delegation of the State Audit Office of Estonia; • delegation of the Accounting Chamber of Ukraine. 3 THE ACCOUNTING CHAMBER OF UKRAINE Among the delegates of our conference are also People´s Deputies of the Verkhovna Rada of Ukraine, representatives of the Secretariat of the President of Ukraine, the National Security and Defense Council of Ukraine, the Security Service of Ukraine, the General Prosecutor´s Office of Ukraine, the State Committee for Financial Monitoring, officials of the ministries and institutions, law enforcement bodies. Wide range of delegates and level of representation prove the undisputable urgency of the problem discussed today. We have to discuss important and urgent issues regarding detection and prevention of fraud and corruption within the system of state financial resources administration, to share knowledge and accumulated experience, to define the role and place of Supreme Audit Institutions in this process and to elaborate specific constructive proposals and recommenda tions aimed at strengthening the fight against this social and political evil. We have prepared draft recommendations taking into account materials and proposals presented in your conference reports. They will be disseminated tomorrow morning for the discussion and adoption. I hope that free communication and atmosphere of trust that we will try to ensure at the conference will contribute to the fruitful cooperation and task solving. I wish successful work to all the delegates of the conference and to all of us. 4 THE PARLIAMENT OF UKRAINE OPENING STATEMENT OF THE CHAIRMAN OF THE PARLIAMENT OF UKRAINE MR. OLEKSANDR MOROZ Dear participants of the Conference! Let me warmly greet you, representatives of Supreme Audit Institutions of the coun tries, which supported the initiative of the Accounting Chamber of Ukraine and agreed to participate in active discussion of the problems connected with organization of fighting with such antisocial phenomenon as corruption and fraud. In current conditions of the society development together with such progressive trends of development as implementation of the advanced innovative technologies in various sectors of economy, unfortunately there are malign manifestations, among which corruption and fraud have the most deep roots and important negative social and political results. Today the problem of corruption exists almost in all countries of the world, and it’s par ticularly apparent in the countries where economy, social relations and political structure of the society are deeply reformed. In such case it has various manifestations and influences state and public institutions in the most harmful way. Supreme Audit Institutions, which have to supervise application of state funds strictly, today have the important mission. The central place among them belongs to the Accounting Chamber as one of the effective instruments of parliament control over public finances. For Ukraine question of creation and support of activity of the Accounting Chamber has its own peculiarities and prehistory. It was not easy to take decision concerning the law on establishing of the Accounting Chamber. Immediately after adoption of the Constitution, where the necessity of formation of such institution was determined, it was found out that the authoritarian government formed at that time didn’t want to let the Parliament control application of budgetary funds and tried to dilute possibilities of the Accounting Chamber for performance of control. Moreover, when institution of the Parliament or parliament control can’t achieve implemen tation of its offers, the function of the Accounting Chamber deteriorates. It turns into some formal body because power is usurped by the authoritarian regime and proposals of the Accounting Chamber are perceived only for scoresettling with those who actually exercise 5 OPENING STATEMENT power, but don’t work for the good of society and law observance. We performed rather keen struggle, which finished with imposing of the President’s veto to amendments even to the Constitution, which were adopted by more than 300 votes, but nevertheless, under dictation of the Administration and the President Constitutional Court took its verdict and acknowl edged this decision the dependent one. Till the moment of adoption of the new version of the Constitution at the end of 2004 we restored rights of the Accounting Chamber for control over not only utilization, but also over revenues of budget funds, and you understand that this is the sector of economy, where corruption arises. After passing to the parliamentarypresidential
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