ORDER OF THE GOVERNMENT OF THE REPUBLIC OF KAZAKHSTAN

of February 18, 2016 No. 76

About approval of Rules of carrying out internal state audit and financial control and recognition voided some decisions of the Government of the Republic of Kazakhstan

According to the subitem 1) of article 11 of the Law of the Republic of Kazakhstan of November 12, 2015 "About the state audit and financial control" the Government of the Republic of Kazakhstan DECIDES:

1. Approve the enclosed Rules of carrying out internal state audit and financial control.

2. Recognize invalid some decisions of the Government of the Republic of Kazakhstan according to appendix to this resolution.

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

Approved by the Order of the Government of the Republic of Kazakhstan of February 18, 2016 No. 76

Rules of carrying out internal state audit and financial control

Section 1. General provisions

1. Rules of carrying out internal state audit and financial control (further - Rules) are developed according to the subitem 8) of article 14 of the Law of the Republic of Kazakhstan of November 12, 2015 "About the state audit and financial control" (further - the Law) and determine procedure for carrying out internal state audit and financial control.

Internal state audit consists of the following interconnected stages:

1) forming of the list of objects of the state audit for the corresponding year providing the organization of the state audit based on risk management system;

2) planning of separate state audit and its carrying out;

3) decision makings and creation of documents by results of internal state audit.

2. In Rules the following basic concepts are used:

1) auditor action - complex of the actions directed to preparation, carrying out, report layout and the conclusions following the results of internal state audit;

2) audit procedures - the actions performed during the auditor action according to the program of audit necessary for goal achievement of auditor action;

3) auditor proofs - actual data taking into account their legality, reliability and admissibility on the basis of which statutory auditors establish availability or lack of violations and (or) shortcomings of work, and also other materials stated in the audit report the confirmatory facts;

4) internal state audit - the analysis, assessment and check of achievement by object of the state audit of the straight lines and resulting effects provided in documents of System of state planning of the Republic of Kazakhstan, reliability and reliability of financial and management information, efficiency of internal processes of the organization of activities of state bodies, qualities of the rendered state services, safety of assets of the state;

5) group of the state audit - two and more statutory auditors, including the head of group of the state audit, and also, if necessary, the involved experts in the corresponding profile;

6) materials of the state audit and financial control - the documents necessary for carrying out the state audit, and also documents and the enclosed auditor proofs constituted by its results;

7) the scale of internal state audit - the list of questions, the period and term of carrying out internal state audit;

8) bodies of internal state audit and financial control (further - bodies of internal state audit) - authorized body on internal state audit (further - authorized body) and its territorial subdivisions, services of internal audit of the central state bodies, except for services of internal audit of National Bank of the Republic of Kazakhstan, service of internal audit of departments of the central state bodies (during creation) and services of internal audit of local executive bodies of areas, the cities of republican value, the capital (further - services of internal audit);

9) the instruction - the act of authorized body, obligatory for execution, and its territorial subdivisions sent to objects of the state audit for elimination of the revealed violations of the law of the Republic of Kazakhstan and (or) the reasons, conditions promoting them, and also taking measures of responsibility provided by the laws of the Republic of Kazakhstan to persons which allowed these violations;

10) the plan of carrying out internal state audit (further - the plan of audit) - the document developed on the basis of data of preliminary studying of object of the state audit, including the name of object, scale, the purpose, subject and type of the state audit, including the priority directions and questions which arose in audit planning process including necessary manpower;

11) the program of carrying out internal state audit (the program of audit) - in details developed document constituted individually on each object of the state audit, containing list of the questions which are subject to internal state audit;

12) the head of group of the state audit - the statutory auditor heading group of the state audit, determined by the head of body of internal state audit;

13) person responsible for auditor action, - the official of body of internal state audit to who obligations on control of the organization and carrying out internal state audit are assigned;

14) the financial reporting - information on financial position, financial results of activities and changes of financial position of objects of the state audit which forms and amounts are determined by the central authorized body by budget implementation if other is not provided by legal acts of the Republic of Kazakhstan.

3. Other concepts used in these rules 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. The state audit and financial control in special state bodies of the Republic of Kazakhstan is exercised according to the procedure, determined by the first heads of data of bodies for coordination with Calculating committee on control of execution of the republican budget (further - Calculating committee) and authorized body.

5. When holding auditor actions statutory auditors, and also the involved experts, specialists of state bodies, auditing organizations (further - experts) are guided by general, procedural standards and these rules, proceeding from the competence established by the Law.

6. Internal state audit and financial control are integral part of system of public administration and are directed to increase in transparency, efficiency, responsibility for use of budgetary funds, assets of the state and quasi-public sector.

7. Internal state audit is booked on the basis of the list of objects of the state audit for the corresponding year (further - the list of objects of the state audit).

8. The structure of group of the state audit includes employees of the bodies of internal state audit participating in holding auditor action, the head of group of the state audit and the statutory auditors participating in holding auditor action and also in need of the expert(s).

9. The authorized body and its territorial subdivisions perform the following types of the state audit:

1) financial records audit - assessment of reliability, justification of the financial reporting, financial accounting and financial condition of object of the state audit;

2) compliance audit - assessment, observance check by object of the state audit of regulations of the legislation of the Republic of Kazakhstan, and also acts of the subjects of the quasi-public sector adopted for their realization.

10. Services of internal audit perform the following types of the state audit:

1) efficiency audit - assessment and the analysis of activities of object of the state audit regarding efficiency, profitability, productivity and effectiveness;

2) compliance audit - assessment, observance check by object of the state audit of regulations of the legislation of the Republic of Kazakhstan, and also acts of the subjects of the quasi-public sector adopted in their realization.

11. Features of financial records audit, compliance audit and audit of efficiency (procedural standards of internal state audit and financial control) are developed and affirm authorized body in coordination with Calculating committee.

12. Within internal state audit of internal state audit by bodies the following inspections are carried out:

1) counter check - check of the third parties which is carried out only concerning relations with the main object of the state audit within the checked question. As the third parties there can be physical persons and legal entities participating in forming of receipts in the budget and (or) using budgetary funds, assets of the state and subjects of the quasi-public sector, the state and guaranteed by the state loans, the connected grants, loans attracted under the guarantee of the state and also exercising control and use of state-owned property;

2) joint check - the inspection which is carried out together with bodies of the state audit and financial control and (or) state bodies in agreed time frames, within the single program and group of the state audit by results of which the single resulting document is accepted;

3) parallel check - the inspection which is carried out with other state bodies, independently on the agreed issues and terms of carrying out with the subsequent exchange of results of checks.

13. By authorized body and its territorial subdivisions it is carried out:

1) annual financial records audit of administrators of the budget programs and public institutions, except for National Bank of the Republic of Kazakhstan;

2) compliance audit:

the expenses connected with increase in estimated cost of the budget investment projects;

uses of means republican and local budgets, the credits, the connected grants, the state and guaranteed by the state loans, and also loans attracted under the guarantee of the state, assets of the state and subjects of the quasi-public sector according to orders of the President of the Republic of Kazakhstan, the Government of the Republic of Kazakhstan, deputy requests and also by results of monitoring of these information systems of the central authorized body on budget implementation;

observance of conditions and procedures of transfer of objects for the purposes of realization of public-private partnership, provision of budget credits, financing of execution of the state obligations on projects of public-private partnership, including the state concessionary obligations, the state guarantees and guarantees of the state, and also their use; observance of conditions and procedures of provision, use of state loans in the cases provided by international treaties of the Republic of Kazakhstan;

compliances with law of the Republic of Kazakhstan about public procurements, state-owned property, financial accounting and the financial reporting, auditor activities on the basis of risk management system.

14. Service of internal audit:

1) participates in carrying out financial records audit;

2) books audit of efficiency in state body, its territorial subdivisions, the subordinated organizations for all directions them activities;

3) performs assessment of functioning of internal control system and management in state body, its territorial subdivisions and the subordinated organizations on the basis of risk management system of internal processes (business processes) of state body;

4) is analyzed by goal achievement and tasks of the strategic plan of state body and development programs of the territories in interrelation with budgeted expenses;

5) books compliance audit in state body, its territorial subdivisions and the subordinated organizations;

6) books compliance audit of procedures of carrying out public procurements and execution of conditions of agreements, including on terms, amount, the price, quantity and quality of acquired goods, works, services;

7) performs check of safety of inventory stocks and other assets in the relevant state body.

15. Bodies of internal state audit perform the analysis, generalization and systematization of the violations and shortcomings revealed by results of the state audit.

Section 2. Forming of the list of objects of the state audit for the corresponding year

16. Forming of the list of objects of the state audit is performed according to the general and procedural standards, the single principles and approaches to risk management system approved by the normative resolution of Calculating committee and the order of the Minister of Finance of the Republic of Kazakhstan of November 27, 2015 No. 590, the Standard risk management system (further - TSUR) approved by the order of the Minister of Finance of the Republic of Kazakhstan of November 30, 2015 No. 597, the Rules of interaction of bodies of the state audit and financial control approved by the normative resolution of Calculating committee and the order of the Minister of Finance of the Republic of Kazakhstan of November 27, 2015 No. 589.

On the basis of TSUR bodies of internal state audit are developed and approve own risk management system according to the assigned functions and powers, stipulated by the legislation the Republic of Kazakhstan.

17. Forming of the list of objects of the state audit is based on system approach according to the following principles:

1) complexity (ensuring interrelation and coordination of all stages of forming of the list - from preliminary stage prior to the finishing procedures);

2) continuity;

3) objectivity.

18. The list of objects of the state audit includes the name of object of the state audit, audit type, terms of carrying out audit.

19. When forming lists of objects of the state audit of authorized body and its territorial subdivisions orders of the President of the Republic of Kazakhstan, persons of Administration of the President of the Republic of Kazakhstan, the Government of the Republic of Kazakhstan authorized by it, deputy requests, requests of bodies of prosecutor's office and criminal prosecution are subject to obligatory consideration and accounting.

20. For forming of lists of objects of the state audit bodies of internal state audit place materials of the state audit and financial control, the reporting in the single database on the state audit and financial control, and also in agreed time frames perform exchange of information with other bodies of the state audit and financial control about lists of objects of the state audit before their approval.

21. The authorized body and its territorial subdivisions approve the lists of objects of the state audit and amounts of budgetary funds and assets covered by the state audit and also fulfill questions of conducting joint, parallel checks with bodies of external state audit.

22. Lists of objects of the state audit affirm for the corresponding financial year heads of authorized body, its territorial subdivisions or the head of state body in which the service of internal audit or persons, them replacing, according to the procedure, is created provided by regulations of work of the relevant state body.

Lists of objects of the state audit of authorized body and its territorial subdivisions are developed and affirm till December 10 of the year previous planned and within three calendar days go to services of internal audit.

The list of objects of the state audit of service of internal audit is developed and affirms till December 20 of the year previous planned, taking into account lists of objects of the state audit of authorized body and its territorial subdivisions and within three working days goes to authorized body.

The approved lists of objects of the state audit, and also change to them within five calendar days from the date of their approval are placed on Internet resource of bodies of internal state audit taking into account observance of the mode of privacy, the office, commercial or protected by the law other secret.

23. The authorized body and its territorial subdivisions within three working days from the date of approval of lists of objects of the state audit send them to Calculating committee, audit committees, authorized body in the field of legal statistics and special accounting, to administrators of the budget programs.

24. Modification of lists of objects of the state audit of authorized body and its territorial subdivisions is allowed regarding exception of objects of the state audit with application of documents (materials) confirming the bases of modification.

Modification and amendments in lists of objects of the state audit of services of internal audit with application of documents (materials) confirming the bases of modification and amendments is allowed.

25. Bodies of internal state audit on permanent basis carry out monitoring of execution of the approved list of objects of the state audit.

26. The authorized body and its territorial subdivisions on quarterly basis carry out monitoring of changes of lists of objects of the state audit of Calculating committee and audit committees.

27. Following the results of the accounting period information on execution of the list of objects of the state audit is provided to the first head of body of internal state audit.

28. Unplanned audit by authorized body and its territorial subdivisions is carried out on:

1) to orders of the President of the Republic of Kazakhstan and Government of the Republic of Kazakhstan;

2) to the questions connected with increase in estimated cost of the budget investment projects;

3) to results of monitoring of these information systems of the central authorized body on budget implementation using risk management system regarding checks on the elicited facts of violations;

4) to appeals of physical persons and legal entities.

Carrying out unplanned state audit on the objects of the state audit included in the list of objects of the state audit approved by Calculating committee for the corresponding year, except for provisions of article 15 of the Law and this Item of Rules is not allowed.

Section 3. Procedure for planning of separate internal state audit and its carrying out

1. Stages of auditor action

29. The organization of auditor action includes stages, each of which is characterized by accomplishment of certain tasks:

1) preparatory;

2) the main;

3) final.

30. Preparatory stage of carrying out internal state audit are preliminary studying of objects of the state audit, scheduling and programs of audit, audit engagements, orders on holding the auditor action, counter, joint and parallel checks (further - the order on holding auditor action) which is the act of purpose of check, the audit engagement on holding auditor action (further - the audit engagement).

The main stage of carrying out internal state audit is holding auditor action.

The final stage of carrying out internal state audit are decision making and creation of documents by results of internal state audit.

2. Preliminary studying of objects of the state audit

31. Preliminary action research of object of the state audit is carried out for refining of amount of the means and assets covered by auditor action, terms of carrying out the state audit, determination of questions of the state audit.

32. Depending on type of the state audit the following indicators are considered:

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

2) profitability - minimization of cost of the estimated results of activities of resources which are marked out for achievement with preserving the corresponding quality of these results;

3) productivity - receipt of the most useful result for economy or the certain sphere of management with use of the allocated resources taking into account quantity, quality and terms;

4) effectiveness - extent of realization of the tasks planned on each activities and ratio planned (direct, final) and the actual results of the related activity;

5) materiality - variation when making by object of the state audit of financial and economic activities from requirements of regulations of the legislation of the Republic of Kazakhstan, and also acts of the subjects of the quasi-public sector adopted in their realization, and also other mistakes exerting impact on the made decisions most of which admissible size is determined according to the legislation of the Republic of Kazakhstan on the state audit and financial control depending on specifics of activities of object of the state audit and measure category;

6) prospects - compliance of the made expenses to the purposes and tasks set on the designated expected period.

33. During preliminary studying on the basis of the analysis and assessment of information on activities of object of the state audit depending on type of audit and the purposes of auditor action, except indicators of the state audit, stipulated in Item 32 these rules, the following indicators are considered:

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