№ 11 (59)/2002

Summary

The Opinion of the Russian Federation Accounts Chamber on the federal draft law "On the Federal Budget for 2003"
(p. 3)

Contents:

• general provisions;
• analysis of the federal draft law "On the Federal Budget for 2003" complying with the Russian Federation Budget Code and other Russian Federation laws;
• assumptions of the benchmark macroeconomic indicators for formulation of the draft federal budget;
• specific features of the federal draft law "On the Federal Budget for 2003 and main characteristics of the budget;
• revenues of the draft federal budget;
• expenditures of the draft federal budget;
• public debt, servicing and repayment of the public debt, government borrowing;
• interrelations between the federal budget and other budgets;
• the program part of the draft federal budget;
• interrelations between the federal budget and budgets of the state extrabudgetary funds;
• conclusions and proposals.

Approved by the Collegium of the Russian Federation Accounts Chamber on 13 September 2002 (Protocol № 27 (310).

Sergei Ryabukhin
(p. 72)

The consolidated report on the results of the audit of the use of funds allocated from the federal budget in 2001 and passed period of 2002 across section "Federal aid to budgets of other tiers" and to agricultural producers of the Kemerovo Region.

The audit showed that the financial aid due to the Region from the federal budget in 2001 had been transferred in full and had been used for the projected purposes. The arrears of the municipal budgets to the regional budget on the loans received and not repaid before 1 January 2002, amounted to RUR 904,694.0 thousand, overdue amounts of payments to budgets of all tiers amounted to RUR 5,464.7 mln, tax and due arrears - to RUR 17,486.0 mln. The total wage arrears including additional payments to regional public officers amounted to RUR 861,373.0 thousand as of 1 March 2002.

RUR 23,144.2 thousand were allocated from the federal budget to agricultural producers of the Region in 2001, that is 100% of the notified limits and 96% of the need. 89.9 tons of pesticides were delivered, that is 58% of the preliminary quantity notified by the Russian Federation Ministry of Agriculture initially; mineral fertilizers - 3.5 thousand tons, or 18.2%.

Ivan Dakhov
(p. 91)

The report on the results of the target and efficient use of federal budget funds allocated for purchase of agricultural equipment based on financial leasing and establishment of the seasonal stock of spare parts in OAO "Rosagrosnab" and directed to the equity capital of OAO "Rosagroleasing" in 2001.

RUR 500 mln were allocated to OAO "Rosagrosnab" in 2001 for purchase and delivery of machine building products based on financial leasing. RUR 5,000 mln out of the projected federal budget funds was directed to the equity capital of OAO "Rosagroleasing" only on 20 December 2001.

The conditions of the OAO "Rosagroleasing" activities are defined solely by the Procedures for the use of OAO "Rosagroleasing" equity capital funds directed to support of the agricultural complex by financial leasing contracts from the funds received from budgets of different tiers which is approved by the decision of the Board of Directors of OAO "Rosagroleasing".

Prior to 2001 the leasing operations with the use of federal budget funds had been made through the federal leasing fund of the RF Ministry of Agriculture. The rise of the leasing object cost in this case did not exceed 18%. After the federal budget funds had been directed to the equity capital of OAO "Rosagroleasing" the cost of combines and tractors with the leasing period of five years increased to 39% for agricultural producers.

The non-execution of contract obligations resulted in the delay of leasing payments. That gave rise to overdue arrears of leaseholders related to return of leasing payments amounting to RUR 87,407 thousand in 2001, while the overdue arrears for 1994-2001 made up RUR 1,310 mln.

Yuri Voronin
(p. 110)

The report on the results of the audit of the complete receipt, targeted and efficient use of federal budget funds and off-budget sources by the Russian Fund of Fundamental Research in 2001-2002.

The audit found as follows:

• the Russian Fund of Fundamental Research is a self-governing state organization providing support of the fundamental scientific research on a competitive basis;
• the type of the Fund's entity which is a federal institution contradicts the provisions of the Russian Federation Budget Code, Article 158, that defines the public authority alone to be the chief administrator of budget funds. This discrepancy has not been eliminated so far; that allows to continue incorrect funding of the Russian Fund of Fundamental Research;
• the Fund has been inappropriately granted the right to retain up to 20% of the coming budget funds to the organizations through which scientific research efforts are funded;
• the Fund does not give due attention to the control over the efficient use of budget funds; it has not installed procedures for defining those entities through which scientific projects are funded;
• the Russian Fund of Fundamental Research applied a simplified mechanism of making decisions about convening scientific conferences and arranging trips abroad for scientists that resulted in the outrunning growth of their number and volume of the related federal budget expenditures.

Sergei Shokhin
(p. 119)

The report on the results of the audit of the reliability of accounting and reporting related to settlements by the agreements concluded by the Government of the Russian Federation and governments of foreign states to settle foreign debt in 1997-2001.

The audit showed: the general volume of settled obligations (new debt obligations of the former USSR assumed by the Russian Federation) related to foreign arrears of foreign trade and other Soviet organizations amounts to the sum equivalent to USD 1.5 bln. The foreign arrears recorded in intergovernmental agreements were settled without completion of related settlements between importers and the federal budget. As on 1 January 2002 the Vneshtorgbank's off-balance accounts hold arrears of 81 organizations to the federal budget in the amount equivalent to USD 1.18 bln.

The Russian Federation Ministry of Finance does not account for the growth of importers' arrears to the federal budget related to payment of the ruble equivalent for the cost of goods and services received by the contracts with foreign exporting companies to be forwarded to the centralized hard currency funds; neither do they account for arrears of foreign trade and other Soviet organizations that arose due to notation of the foreign arrears to the foreign public debt of the Russian Federation.

Gennady Batanov
(p. 127)

The report on the results of the complex audit of the execution of budget revenues and expenditures of the Federal Compulsory Medical Insurance Fund in 2001.

The complex audit found as follows:

• the execution of revenues and expenditures of the Fund's budget is, basically, in compliance with current legislation in terms of volume, structure and designation;
• the Fund places its monetary funds with a commercial bank in violation of the Russian Federation Law № 394-1 of 2 December 1990 "On the Central Bank of the Russian Federation" and Federal Law № 165 of 16 July 1999 "On Fundamentals of Compulsory Social Insurance";
• the sum of RUR 308.6 ml intended for the Fund's share participation in funding regional target programs of mothers' and children's protection was used for another purpose;
• the projection for receipt of insurance contributions paid as part of the single social tax was implemented for 107%. At the same time there is a discrepancy between the projected figures approved for the budget of Compulsory Medical Insurance regional funds and the control assignment set by the Tax Ministry Directorate responsible for the Constituent Members of the Russian Federation;
• the approved estimate of the Fund's expenditures was executed for the smaller amount than projected;
• the Fund's top management did not take measures to write off, in the established manner, receivables in the amount of RUR 20.5 mln with elapsed limitation (impossible to be recovered);
• the cost (budget) principle of payments for medical care was basically preserved in the healthcare system.

Gennady Batanov
(p. 143)

The report on the results of the complex audit conducted on the execution of revenue and expenditure items of the Russian Federation Social Insurance Fund budget in 2001with results of field work included.

The complex audit found as follows:

• the establishment of the legislative basis regulating the Fund's activities was not completed. Contrary to the Russian Federation Budget Code, Article 143, the Federal law on the Social Insurance Fund has not so far been passed;
• the revenue part of the Fund's budget was executed for 136.6%, amounted to RUR 117,953.5 mln and exceeded the 2000 revenues by RUR 19,300.0 mln. When executing the expenditure items of the budget the Fund sometimes made inefficient use of funds provided by the budget for the sanatorium and health-resort treatment and rehabilitation of the employees, their families and participants of the Great Patriotic War;
• owing to the lack of informational exchange between the Fund and the Russian Federation Ministry of Taxes and lack of coordination in 2001 the Fund's arrears to the insurants grew over 7 times and the sum of the single social tax charged in excess amounted to nearly RUR 5 bln;
• pursuant to Federal Law № 165 of 16 July 1999 "On the Fundamentals of the Compulsory Social Insurance", Articles 23 and 24, the Fund is to keep its monetary funds on accounts of the Russian Federation Central Bank as well as on accounts of other banks the list of which is to be defined by the Government of the Russian Federation. However, the situation when the Fund has to choose banks for keeping its monetary funds and getting banking services at its own disposal increases the risk of losing state social insurance funds.

Vladimir Panskov
(p. 158)

Article "Temporary Procedures for Exercising Control over Compliance with Tax and Budget Legislation of the Russian Federation".

These procedures have been developed in accordance with the working plan of the RF Chamber of Accounts for 2002 and are intended to be applied in the practical work of the RF Chamber of Accounts for the following purposes:

• to ensure a uniform approach to defining tax and budget offenses;
• to organize accounting for tax and budget offenses and control over reimbursement for the damage caused to the federal budget by these offenses;
• to develop proposals on improvement of the tax and budget legislation of the Russian Federation given the offenses detected by audits.

Vladislav Ignatov, Alexei Boiko
(p. 176)

Structural Reorganization and Privatization in the Russian Federation Civil Aviation: Results and Priorities.

Regular audits of aviation entities - almost all Moscow airports and aviation companies, specifically, as well as scientific research institutions and the Russian Federation civil aviation administrative bodies - allow to identify basic problems of air transport and foresee solutions thereof.

The audits showed that privatization of state enterprises should not be an end in itself or an accessible means to enlarge budget revenues. Privatization should have a target character and ensure higher efficiency of management and production, essential structural changes, optimal concentration of production and state control (interests) in the strategically important joint-stock companies. The current system of state interest representation in the joint-stock companies is formal and does not contain any elements of responsibility.

For the sake of establishing the efficient state regulation of civil aviation activities it would be necessary not to weaken but to improve the certification and licensing procedures for air transportation. Measures should be taken to limit (exclude) the conditions under which non-authentic units and components of unidentified origin are installed on planes and helicopters; that causes damage to the property and undermine safety of air transportation.

In implementation of the Federal Target Program "Modernization of the Russian Federation Transport System (Civil Aviation) for 2002-2010" the resource sub-program should be developed providing for raising the required sums of off-budget sources - mainly, borrowed funds under the government's guarantee.