2015年-世界发展银行全球_Mongolia_Public_Financial_Management_Performance_Report_84页_4mb

Summary of Mongolia Public Financial Management (PFM) Performance Report (April 2015)

Core Content

This report presents the first assessment of Mongolia's Public Financial Management (PFM) system using the Public Expenditure and Financial Accountability (PEFA) framework. It evaluates the performance of the budgetary central government across six key dimensions of PFM, including budget credibility, comprehensiveness and transparency, policy-based budgeting, predictability and control in budget execution, accounting, recording and reporting, and external scrutiny and audit. The findings aim to provide an objective baseline of current PFM performance and guide future reform priorities.

Main Sections and Key Findings

1. Introduction and Background

• The report focuses on the central government's PFM system.
• The PEFA framework is used to measure PFM performance through 28 high-level indicators.
• The assessment highlights the strengths and weaknesses of Mongolia's PFM system, particularly over the past decade of reforms.

2. Budget Credibility

• Weakness: The State Budget has low credibility due to significant deviations between planned and actual expenditures and revenues.
• Deviation in Expenditures: Over 15% deviation in expenditures in each of the past three years (2011–2013).
• Deviation in Revenues: Over 20% deviation in two of the past three years.
• Reasons for Weakness:
  • High dependency on mineral resources causes structural volatility in the economy.
  • Political pressure to increase spending leads to overly optimistic revenue forecasts.
• Impact: The lack of credibility results in mid-year budget amendments and a significant increase in expenditure arrears.

3. Comprehensiveness and Transparency

• Strength: Mongolia has made progress in budget comprehensiveness and transparency.
• Achievements:
  • The Integrated Budget Law (IBL) of 2011 initiated fiscal decentralization and rule-based fiscal transfers.
  • Annual budget documentation is comprehensive, meeting 8 out of 9 requirements.
  • Public disclosure of fiscal information has increased since 2006.
• Weakness:
  • Unreported extra-budgetary financing of capital projects compromises transparency and accuracy.
  • Inconsistencies in the chart of accounts reduce the quality of fiscal information.
  • Limited oversight of fiscal risks from state-owned enterprises.

4. Policy-Based Budgeting

• Strength: The annual budgeting process is well-regulated and orderly.
• Weakness:
  • The MTFF (Medium Term Fiscal Framework) lacks a multi-year perspective and does not cover off-budget expenditures.
  • There is poor coordination between the Ministry of Economic Development (MED) and the Ministry of Finance (MoF) in investment and recurrent budgeting.
  • Budget estimates do not consistently reflect the actual needs and costs of capital projects.

5. Predictability and Control in Budget Execution

• Mixed Performance:
  • Tax administration has shown good progress, including transparency in taxpayer obligations, efficient collections, and the functioning of the Treasury Single Account (TSA).
  • Payroll controls are weak, with inconsistencies between personnel records and actual payroll.
  • Excessive use of extra-budgetary funds undermines procurement processes, as most procurement from these funds is non-competitive.
  • Weak cash management and frequent monthly budget revisions reduce predictability.
  • Internal controls are effective, but internal audit is still developing with inconsistent compliance and reporting.

6. Accounting, Recording, and Reporting

• Strength: Accounting practices are generally strong.
• Weakness:
  • Reports are not fully compliant with International Public Sector Accounting Standards (IPSAS).
  • The Government Financial Management Information System (GFMIS) is not used for financial reporting, leading to inefficiencies and duplication.
  • Inconsistencies in the chart of accounts affect the accuracy of budget execution reports.

7. External Scrutiny and Audit

• Strength: The State Great Khural (parliament) exercises considerable authority over fiscal matters.
• Weakness:
  • Limited attention is given to external audit reports, reducing government accountability.
  • Internal audit function began in 2012 under the IBL and is progressing, but audit units are not yet fully compliant with professional standards.
  • Follow-up on audit recommendations is inconsistent.

Key Performance Indicators Summary

Key Issues and Recommendations

• Budget Credibility: Needs to be improved through better revenue forecasting and reducing political pressure to increase spending.
• Transparency: Extra-budgetary operations should be included in budget documentation and reconciled with the main budget.
• Multi-Year Fiscal Planning: The MTFF should be expanded to include off-budget expenditures and better link with the annual budget.
• Coordination Between Ministries: Improved coordination between MED and MoF is essential for effective resource allocation.
• Internal Audit: Strengthen the internal audit function to ensure compliance with professional standards and timely follow-up on audit recommendations.
• Tax Administration: Continue to improve taxpayer registration and reduce ad hoc audits.
• Procurement: Strengthen controls on non-competitive procurement processes and ensure that the regulatory framework applies to all projects, including those funded by the DBM.

Conclusion

The report highlights both progress and persistent challenges in Mongolia's PFM system. While there have been improvements in transparency and the legal framework, budget credibility, multi-year planning, and coordination remain critical areas for reform. The PFM system's weaknesses have implications for fiscal discipline, strategic resource allocation, and efficient service delivery, requiring sustained efforts to enhance accountability and efficiency.