2005年-世界发展银行全球_Republic_of_Lebanon___Country_Financial_Accountability_Assessment_116页_1mb

Summary of the Republic of Lebanon Country Financial Accountability Assessment (CFAA)

Core Content

The Country Financial Accountability Assessment (CFAA) for Lebanon, conducted by the World Bank in May 2005, evaluates the country's public financial management (PFM) system, focusing on budgeting, accounting, reporting, internal controls, and the Court of Accounts. The assessment was carried out in collaboration with the IMF and aims to provide a comprehensive understanding of Lebanon's financial accountability framework and identify areas for improvement.

Main Objectives

• Assess the design and implementation of Lebanon’s financial accountability framework.
• Evaluate the ability of the framework to ensure the proper use of government resources.
• Identify and document the most significant fiduciary risks.
• Support the development of a unified budget framework and improve PFM systems.
• Provide recommendations for enhancing transparency, accountability, and efficiency in financial management.

Key Findings and Recommendations

Budgeting

• Fiduciary Risk: The fragmented budget framework poses a high fiduciary risk due to the lack of integration of extra-budgetary funds and public enterprises into the main budget.
• Extra-Budgetary Funds: These represent 18.9% of total spending in 2004 and are not fully disclosed to Parliament or the public. They include the National Social Security Fund (NSSF) and the Independent Municipal Fund.
• Recommendations:
  • Prepare audited consolidated financial statements that include extra-budgetary entities, municipalities, and public enterprises.
  • Fully consolidate the CDR's investment budgets into the main government budget.
  • Improve the governance and transparency of the NSSF and Independent Municipal Fund.
  • Develop a new law on public enterprises to strengthen governance and require compliance with international accounting standards.
  • Amend the Public Accounting Law to limit carry-forwards to five years and require timely reporting of final budget execution to Parliament.

Accounting and Reporting

• Standards Compliance: The Government claims to follow international accounting standards, but this needs to be legally mandated.
• Accrual Accounting: The Government has accepted the IMF's recommendation to transition to accrual accounting, which will improve financial information quality.
• Recommendations:
  • Amend the Public Accounting Law to require compliance with international accounting and reporting standards.
  • Ensure that final budget execution reports, financial statements, and auditor reports are submitted to Parliament within nine months of the fiscal year end.
  • Develop a modern financial management information system (FMIS) with electronic authorizations and transactions.

Internal Controls and Internal Audit

• Legislative Base: The legal framework for internal controls is outdated and inadequate, relying on the 1963 Law on Public Accounting.
• Current Practices: Internal control processes are complex, non-transparent, and prone to corruption. There is no modern internal audit system in place.
• Recommendations:
  • Strengthen the legislative base for internal controls.
  • Establish a phased internal audit system within the Ministry of Finance (MOF).
  • Develop internal audit policies, practices, and guidelines across the government.
  • Train new auditors through the MOF Training Institute.
  • Align the legal framework with the EU Public Internal Financial Control Systems model.

Court of Accounts (COA)

• Role: The COA is the external auditor, responsible for overseeing the use of public funds.
• Compliance: The COA has not provided a formal audit opinion on the Government's annual financial report, which is a concern.
• Recommendations:
  • Ensure the COA provides an audit opinion on the fairness of the Government's financial statements.
  • Strengthen the COA's compliance with INTOSAI audit standards.

Fiduciary Risk Assessment

• High Risk Areas: The fragmented budget framework, incomplete reporting, and weak internal controls are major sources of fiduciary risk.
• Need for Reform: The Government must improve coordination between current and investment budgets, streamline expenditure control, and enhance transparency and accountability.

Conclusion

The CFAA highlights the urgent need for reform in Lebanon's public financial management system to ensure greater transparency, accountability, and efficiency. The assessment recommends legal and institutional improvements, including the adoption of international accounting and audit standards, the development of a unified budget framework, and the establishment of a robust internal audit system. These reforms are essential to mitigate fiduciary risks and align the country's financial management practices with international best practices.