Intense work has continued at the NAOF after the Christmas break – in both audit and monitoring. In addition to auditing, the end of 2020 at the NAOF was marked by numerous hearings by parliamentary committees: the topics varied from fiscal policy and management of employment to incorporation of central government operations and risk management. Hearings play an important role, as Parliament is one our key stakeholders even in the use of impartial information. We have also continued to have a close dialogue with the management of ministries over remote connections, which has also been useful for the planning of our operations.
Author
Matti Okko
Director
Management, Monitoring and Oversight
Last year, we reacted to the changes and challenges brought by the Covid-19 situation. Through audits, we started to examine issues that are essential to the management of central government finances, such as the allocation of corona-related business subsidies, preparation for exceptional circumstances, and debt management. The first results of these audits can be expected in late spring.
We have launched inspiring cooperation with the supreme audit institutions of other countries in connection with Covid-19-related audits, and we have seen good examples of fast actions and how to target them. The situation has also brought new dimensions to fiscal policy monitoring, as the assessment of the fiscal policy pursued during the exceptional circumstances and of the Government’s employment targets have risen to the top of the task list. Fiscal rules continue to be suspended, but we have already urged the Government justifiably to present statutory objectives for general government finances.
The NAOF’s field of operations will expand as reforms are implemented
We will keep up with the acute issues of financial management, but we will also look further towards major social reforms and operating models that are still being prepared. Notable reforms include, in particular, the health and social services reform, the rescue services reform, various measures related to the management of employment, the social security reform, and the reform of continuous learning. The successful implementation of these reforms plays a key role for the stabilization of general government finances and, ultimately, improved sustainability.
The NAOF’s field of operations will expand as a result of the implementation of the health and social services reform, as it has been proposed that the NAOF should be responsible for the external audit of the operations and financial management of the wellbeing services counties and their subsidiaries. We are preparing for this. In addition, we keep a close eye on the preparation of major infrastructure projects based on the state’s multi-channel financing and SPE (special purpose entity) models. We will naturally also follow up the strategic projects of the Finnish Defence Forces to the very end, mainly to ensure the knowledge base of decision-making.
In this connection, it should also be mentioned that we are planning to change the implementation of our audit follow-ups during the year. We aim to achieve a more effective and efficient process where we will continue to follow up the conclusions and recommendations of our audits comprehensively but where we will also go deeper into issues that are significant for central government finances.
The new audit plan focuses on balanced general government finances and economic growth
We completed the NAOF’s audit plan for 2021–2025 in December. The audit plan presents the new audit topics selected for this year based on risk analyses. In addition to the significance for central government finances, the targeting of audits is based on public-sector reforms. This year, we have paid special attention to the balancing of central and general government finances and measures required for enhancing economic growth.
The next checkpoint for planning is in late spring, when we will be able to supplement and change the audit plan based on our findings. Thanks to the experiences we have gained during the Covid-19 epidemic, we will be ready to react to unexpected and significant external drivers for change.
Audit plan
