| Abstract [eng] |
This master's final project analyzes the sufficiency of financial management control of self-governing institutions. In order to ensure the adequacy and effectiveness of financial management controls, the most important thing is to perform quality controls. Such control reveals the shortcomings of organizations' activities, evaluates the quality and efficiency of activities, checks the effectiveness of internal control systems, provides recommendations for improvement, informs responsible institutions and the general public. Providing authorities and the public with sound information verified by objective reports helps to stabilize the state and improve public sector management processes. The object of work is financial management control of self-governing institutions. The aim of the work is to assess the financial management control of self-governing institutions. Tasks set to achieve the goal: 1. analyze the peculiarities of financial management of self-governing institutions; 2. characterize the financial management control measures of self-governing institutions; 3. reveal the problems of ensuring the sufficiency of public sector financial management control; 4. to identify the risks of irresponsible financial management in self-government institutions, signs of risk and provide recommendations for increasing the effectiveness of control; 5. based on the results of the empirical study, provide recommendations on the planning and organization of external audits of self-governing institutions. In order to find out the shortcomings of financial management and internal control identified by local government institutions and the inadequacy of external control, 144 audit reports of the activities of the control and audit services of the municipalities of the Republic of Lithuania for the year 2021-2022 were analyzed. Statistical data analysis, secondary data analysis, comparative analysis, detailing, data grouping, elimination, averaging and generalization methods were used to conduct the empirical study. Data were processed with Microsoft Office Excel and NCSS PASS programs. In the scientific literature, it is observed that the financial management problems of self-government institutions are often related to insufficient internal control, incompatibility of accounting and financial reporting, inadequate disclosure of assets and liabilities, insufficient regulation of activities, and insufficient attention to the monitoring of budgeted activities and comparison with the intended results. The results of the empirical study revealed that the greatest risk of irresponsible financial management of self-governing institutions was identified in the economic field of municipal allocations, which substantiates the significant deficiencies in financial management identified in the field of municipal infrastructure development. The main areas of activity of municipalities, where the biggest weaknesses in financial management and internal control have been identified, are not controlled by external auditors. The limited human resources available to the control and audit services of municipalities and the relatively small number of performed audits per year do not ensure sufficient control of self-governing institutions. |
