ORDER OF THE MINISTER OF FINANCE OF THE REPUBLIC OF KAZAKHSTAN

of October 2, 2018 No. 873

About approval of the procedural standard of internal state audit and financial control on carrying out audit of efficiency by services of internal audit

According to the subitem 2) Item 2 of article 8 of the Law of the Republic of Kazakhstan "About the state audit and financial control" PRIKAZYVAYU:

1. Approve the enclosed procedural standard of internal state audit and financial control on carrying out audit of efficiency by services of internal audit.

2. To department of methodology of financial accounting and audit of the Ministry of Finance of the Republic of Kazakhstan (Bekturova A. T.) in the procedure established by the legislation to provide:

1) state registration of this order in the Ministry of Justice of the Republic of Kazakhstan;

2) within ten calendar days from the date of state registration of this order the direction it the copy in electronic form in the Kazakh and Russian languages in the Republican state company on the right of economic maintaining "The republican center of legal information" of the Ministry of Justice of the Republic of Kazakhstan for official publication and inclusion in Reference control bank of regulatory legal acts of the Republic of Kazakhstan;

3) placement of this order on Internet resource of the Ministry of Finance of the Republic of Kazakhstan;

4) within ten working days after state registration of this order in the Ministry of Justice of the Republic of Kazakhstan submission to Department of legal service of the Ministry of Finance of the Republic of Kazakhstan of data on execution of the actions provided by subitems 1), 2) and 3) of this Item.

3. This order becomes effective after ten calendar days after day of its first official publication.

Approved by the Order of the Minister of Finance of the Republic of Kazakhstan of October 2, 2018, No. 873

The procedural standard of internal state audit and financial control on carrying out audit of efficiency by services of internal audit

Section 1. General provisions

1. This procedural standard of internal state audit and financial control on carrying out audit of efficiency by services of internal audit (further – the Standard) is developed according to the subitem 2) of Item 2 of article 8 of the Law of the Republic of Kazakhstan "About the state audit and financial control" (further – the Law).

2. The purpose of the audit of efficiency booked by services of internal audit (further – SVA), is forming of independent, competent and objective assessment of activities of object of the state audit and forming of recommendations for:

rendering assistance to object of the state audit, to state bodies, and also other receivers of budgetary funds which are involved in management and administration of activities of this object of the state audit and (or) the direction of the state audit, in overcoming existing and (or) potential system problems, shortcomings and violations;

increases in efficiency, strengthening of transparency and accountability of management and administration of activities of object of the state audit and (or) in the corresponding direction of the state audit.

3. For the purposes of these Standards the following basic concepts are used:

1) working documents - the documents reflecting results of the performed audit procedures, and also the obtained auditor evidence and the conclusions drawn by the statutory auditor;

2) productivity of use financial and appliances - ratio between results of activities of object of audit of efficiency and material and financial resources used on their production;

3) effectiveness of use financial and appliances - degree of compliance of results of activities of objects of audit of efficiency to the planned results;

4) the expert - the physical person or legal entity having special knowledge of the field of the state audit, and (or) activities of object of the state audit;

5) profitability of use of the state-owned property which is in state-owned property - achievement by object of audit of efficiency of the set results with use of the smallest amount of budget funds and the property which is in state-owned property;

6) risk - probability of negative impact on object of audit of efficiency of any factor (action or event) which can lead to financial losses, causing damage, inability to implement the assigned function or the program and to provide at the same time effective use financial and appliances;

7) efficiency - ratio of the received results to planned taking into account the resources used for their achievement;

8) efficiency audit indicators - the absolute, qualitative, quantitative, relative or dynamic measures which are criterion for assessment of achievement of effective objectives or the planned results from the point of view of efficiency, profitability, productivity and effectiveness;

9) internal control system - set of policy, processes and procedures, standards of behavior and actions of object of audit of efficiency to provide the effective activities allowing to react as appropriate to substantial risks regarding goal achievement, the tasks delivered before object of audit of efficiency, and also assigned to it from the point of view of efficiency, profitability, productivity and effectiveness of activities of object of the state audit.

Other concepts used in this Standard are applied in the values determined by the Budget code of the Republic of Kazakhstan, the Law and other legislation of the Republic of Kazakhstan.

4. All activities are subject to audit of efficiency:

in state body, its departments, territorial subdivisions, the subordinated organizations - for SVA of the central state bodies, except for SVA of National Bank of the Republic of Kazakhstan and authorized body on regulation, control and supervision of the financial market and the financial organizations;

in the executive bodies financed from local budgets and which are in the territory of administrative subordination of the respective area, the cities of republican value, the capital, their divisions, the subordinated organizations - for SVA of local executive bodies of areas, the cities of republican value, the capital.

5. Statutory auditors perform effective communications throughout all process of carrying out the state audit with the officials responsible for holding auditor action.

6. This Standard determines the sequence of actions of the statutory auditor in auditing process of efficiency and extends to officials of SVA, assistants to the statutory auditor, the physical persons and legal entities involved in carrying out the state audit.

7. Audit of efficiency is booked using horizontal or vertical approach.

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