I. Budget reliability
Scores by Dimension
Overall Indicator Score
1. Aggregate expenditure outturn
B
Notes:
1.1 Aggregate expenditure outturn
B
Notes:
Aggregate expenditure outturn was between 90% and 110% of the approved aggregate budgeted expenditure in two of the three years.
2. Expenditure composition outturn
D+
Notes:
2.1 Expenditure composition outturn by function
D
Notes:
Variance in expenditure composition exceeded 15 per cent in two of last three years.
2.2 Expenditure composition outturn by economic type
B
Notes:
Variance was less than 10% in two of the last three years.
2.3 Expenditure from contingency reserves
A
Notes:
Emergency funds made up less than 0.15 per cent of total budgeted expenditure in 2017-19.
Notes:
3.1 Aggregate revenue outturn
B
Notes:
Aggregate revenue outturns were between 94% and 112% of budgeted revenue in all 3 years.
3.2 Revenue composition outturn
D
Notes:
Variance in revenue composition was greater than 15% in 2 out of 3 years.
II. Transparency of public finances
Scores by Dimension
Overall Indicator Score
4. Budget classification
A
Notes:
4.1 Budget classification
A
Notes:
Revenue and expenditure are shown according to administrative, economic (consistent with GFS 2001) functional (consistent with UN COFOG) and programme classifications at all stages in budget preparation, execution.
Notes:
5.1 Budget documentation
A
Notes:
11 elements of information satisfied including 4 basic elements.
6. Central government operations outside financial reports
B
Notes:
6.1 Expenditure outside financial reports
C
Notes:
Advances of about 7.5% of RB expenditure to meet SOE deficits are not included in budget execution reports.
6.2 Revenue outside financial reports
A
Notes:
All revenue of bodies controlled by the Government is included in financial reports.
6.3 Financial reports of extrabudgetary units
B
Notes:
2019 reports by the social insurance funds were submitted s to MoF on 22 May 2020nd.
7. Transfers to subnational governments
B+
Notes:
7.1 System for allocating transfers
A
Notes:
Over 90% of revenue accruing from central government is determined by transparent rule-based systems.
7.2 Timeliness of information on transfers
B
Notes:
LSGs are notified in September how much they can expect next year in tax revenue and in November of their receipts of transfers.
8. Performance information for service delivery
C+
Notes:
8.1 Performance plans for service delivery
C
Notes:
Information is published annually about the planned outputs and activities covering 85% of budget expenditure .
8.2 Performance achieved for service delivery
C
Notes:
Reports are made of performance against targets, but there is not much explanation where these are missed.
8.3 Resources received by service delivery units
A
Notes:
The Treasury system collects information about all resources received by each individual school and health clinic.
8.4 Performance evaluation for service delivery
D
Notes:
Although evaluations of education and social protection expenditure have been produced in connection with the evaluation of the impact of EU budget support, no evaluations have been commissioned by the Kyrgyz Government.
9. Public access to fiscal information
D
Notes:
9.1 Public access to fiscal information
D
Notes:
Only 1 of the basic elements was fully provided. Any score of C or above requires at least 4.
III. Management of assets and liabilities
Scores by Dimension
Overall Indicator Score
10. Fiscal risk reporting
C
Notes:
10.1 Monitoring of public corporations
C
Notes:
Financial reports audited by commercial auditors are submitted to Government and published within 9 months of year end.
10.2 Monitoring of subnational governments
C
Notes:
Financial reports are produced by all LSGs within 3 months of year-end, but these are only audited every second year in a longer timescale.
10.3 Contingent liabilities and other fiscal risks
NA
Notes:
Amounts outstanding under Public-Private Partnerships are insignificant, and there are no other explicit contingent liabilities.
11. Public investment management
C+
Notes:
11.1 Economic analysis of investment proposals
C
Notes:
Major projects are subject to economic analysis, but the results had not been published at the time of this assessment.
11.2 Investment project selection
C
Notes:
Major projects are prioritized by the Government Council on Fiscal and Investment Policy, but there are no published criteria for their selection.
11.3 Investment project costing
D
Notes:
Budget documents show expenditure on major projects in the budget year and two subsequent years, but not the total costs of each project.
11.4 Investment project monitoring
A
Notes:
Regular reports of progress, both physical and financial, are made by implementing agencies in a format prescribed by Regulation to MoF and Ministry of Economy. Information is published on agency websites, and included in annual budget execution reports.
12. Public asset management
B
Notes:
12.1 Financial asset monitoring
B
Notes:
MoEF and NBKR regularly monitor different categories of financial asset, which are recognized at original cost.
12.2 Nonfinancial asset monitoring
C
Notes:
A full Register of the Government’s nonfinancial assets was completed in October 2020. It is open to the public, but subsoil assets are not included.
12.3 Transparency of asset disposal
A
Notes:
Disposals are transparently regulated, and all details of disposals published on website etp.okmot.kg.
Notes:
13.1 Recording and reporting of debt and guarantees
A
Notes:
Records of external and internal are complete, accurate and reconciled monthly.
13.2 Approval of debt and guarantees
A
Notes:
The Ministry of Finance controls all aspects of debt management in accordance with clearly documented policies.
13.3 Debt management strategy
A
Notes:
The Government’s debt management strategy is clearly set out in medium-term fiscal policy documents, and regular reports are made to Parliament on progress.
IV. Policy-based fiscal strategy and budgeting
Scores by Dimension
Overall Indicator Score
14. Macroeconomic and fiscal forecasting
D+
Notes:
14.1 Macroeconomic forecasts
D
Notes:
A detailed macro-economic forecast covering the next 3 years is submitted to Parliament each year at the beginning of consideration of budget proposals. But the exchange rate assumption is incompatible with IMF projections of the economy, including exchange rate movements
Notes:
Projections of the main fiscal indicators, including revenues by type and a summary breakdown of expenditure are submitted to the Parliament in September each year. But these do not include an explanation of changes since the previous year.
14.3 Macrofiscal sensitivity analysis
D
Notes:
The Explanatory Note on the Government’s budget proposals contains an analysis of the impact of relatively small changes in exchange rate and economic growth assumptions on the fiscal balance and aggregate debt. But these are not sufficient to expose the underlying risks.
Notes:
15.1 Fiscal impact of policy proposals
A
Notes:
The Government’s budget proposals submitted to the Parliament show the impact of all proposed changes in revenue and expenditure for the budget year and the 2 following years.
15.2 Fiscal strategy adoption
A
Notes:
The Main Directions of Fiscal Policy document submitted to Parliament with the budget proposals contains quantitative fiscal goals for the 3 years ahead. Expenditure proposals contain indications of results to be achieved.
15.3 Reporting on fiscal outcomes
D
Notes:
The budget proposals do not contain any explanation of changes in the future fiscal outlook as compared with the forecast produced the previous year.
16. Medium-term perspective in expenditure budgeting
C+
Notes:
16.1 Medium-term expenditure estimates
A
Notes:
The annual budget presents estimates of expenditure for the budget year and 2 following years allocated by administrative, economic and programme classification.
16.2 Medium-term expenditure ceilings
A
Notes:
Expenditure ceilings for each budget user for the budget year and the 2 following years are approved by the Fiscal and Investment Council chaired by the Prime Minister at the beginning of the budget preparation process.
16.3 Alignment of strategic plans and medium-term budgets
D
Notes:
There is no alignment between the medium-term budgets and the strategic plans which are not costed or time-bound.
16.4 Consistency of budgets with previous year’s estimates
D
Notes:
There is no explanation of the extent to which expenditure figures differ from the corresponding figures for the same period in the previous year’s proposals.
17. Budget preparation process
B+
Notes:
Notes:
The calendar for the preparation of the following year’s budget is issued by the Prime Minister in January each year. In 2020 there was some slippage in this calendar, although in the event Budget users had 6 weeks to agree their final proposals with MoF.
17.2 Guidance on budget preparation
B
Notes:
Preliminary expenditure ceilings are intended to be issued by MoF before the end of April, and after discussion with budget users incorporated in the Main Directions of Fiscal Policy document approved by the Government in June.
17.3 Budget submission to the legislature
A
Notes:
Budget proposals were submitted by the Government to Parliament on 2 October 2017, 1 October 2018 and 1 October 2019.
18. Legislative scrutiny of budgets
B+
Notes:
18.1 Scope of budget scrutiny
B
Notes:
The Parliament’s review covers fiscal policies and aggregates for the coming year as well as details of revenue and expenditure, but no attention is paid to the two subsequent
18.2 Legislative procedures for budget scrutiny
A
Notes:
The Parliament’s procedures are well-established, and include public hearings on the Government’s proposals as well as study by specialised Committees.
18.3 Timing of budget approval
A
Notes:
The last three Budgets have all been approved before the beginning of the years to which they relate.
18.4 Rules for budget adjustment by the executive
B
Notes:
Article 115 of the Budget Code authorizes substantial budget reallocations by the Government, subject to the agreement of the Parliament’s Budget and Finance Committee.
V. Predictability and control in budget execution
Scores by Dimension
Overall Indicator Score
19. Revenue administration
C+
Notes:
19.1 Rights and obligations for revenue measures
B
Notes:
Taxpayers can obtain information on liability to different types of tax, through websites and telephone enquiry facilities, as well as information about appeal arrangements.
19.2 Revenue risk management
C
Notes:
Different approaches are taken depending on the nature of the tax and the behaviour of taxpayers.
19.3 Revenue audit and investigation
D
Notes:
There is a very substantial programme of tax audits, but there is no documented compliance improvement plan.
19.4 Revenue arrears monitoring
A
Notes:
Tax arrears at the end of 2019 were about 5.6% of total collections of 105.9bn KGS. Of the total arrears of 5.9bn KGS.395m KGS or 6.7% were more than 12 months old.
20. Accounting for revenue
A
Notes:
20.1 Information on revenue collections
A
Notes:
Tax revenue is paid directly into Treasury Single Account at the NBKR via local Treasury offices, with daily notification to tax collectors. There are monthly reports to Treasury by Tax and Customs services, with similar arrangements for other .
20.2 Transfer of revenue collections
A
Notes:
All revenue from all sources is remitted to the Treasury on the day it is received.
20.3 Revenue accounts reconciliation
A
Notes:
There are monthly reconciliations between Treasury records and those of bodies collecting revenue. Individual taxpayers’ accounts are updated as payments are received by the revenue authorities.
21. Predictability of in-year resource allocation
B+
Notes:
21.1 Consolidation of cash balances
C
Notes:
Most cash balances are consolidated daily in the Treasury Single Account, but externally financed PIP transactions take place through commercial banks.
21.2 Cash forecasting and monitoring
A
Notes:
A cash flow plan was prepared at the beginning of the year, and thereafter updated monthly.
21.3 Information on commitment ceilings
C
Notes:
Budgetary units were able to plan and commit expenditure on a monthly basis.
21.4 Significance of in-year budget adjustments
A
Notes:
Significant In-year budget adjustments were limited to one in 2019 which followed standard procedures.
Notes:
22.1 Stock of expenditure arrears
D*
Notes:
Although accounts payable were less than 6% of expenditure for all 3 years 2017-19, no specific information was available about the extent to which payments were in arrears.
22.2 Expenditure arrears monitoring
D
Notes:
No specific monitoring and reporting of expenditure arrears takes place.
Notes:
23.1 Integration of payroll and personnel records
B
Notes:
Individual public bodies ensure consistency between personnel records and payroll under a decentralised system that is broadly sound. But there are no automatic links between personnel records and the payroll.
23.2 Management of payroll changes
A
Notes:
Changes to payroll are fully regulated and promptly administered.
23.3 Internal control of payroll
B
Notes:
Authority to make changes to payroll and personnel data is restricted and controls are mostly effective though audit findings have identified weaknesses in internal controls.
Notes:
The Accounts Chamber audits payroll across government as part of its annual audit work.
Notes:
24.1 Procurement monitoring
A
Notes:
Effective recording, monitoring and reporting takes place routinely.
24.2 Procurement methods
A
Notes:
Over 80% of contracts by value were let using competitive methods.
24.3 Public access to procurement information
A
Notes:
All necessary information is available through the electronic portal.
24.4 Procurement complaints management
A
Notes:
All criteria are satisfied.
25. Internal controls on nonsalary expenditure
A
Notes:
25.1 Segregation of duties
A
Notes:
Duties and responsibilities are well segregated.
25.2 Effectiveness of expenditure commitment controls
A
Notes:
Commitments limited to budgetary provision and cash availability.
25.3 Compliance with payment rules and procedures
A
Notes:
High level of compliance with payments rules and procedures.
Notes:
26.1 Coverage of internal audit
B
Notes:
Most of total budgeted expenditure and revenue is subject to internal audit.
26.2 Nature of audits and standards applied
B
Notes:
Audit work pays attention both to financial compliance and management systems and controls.
26.3 Implementation of internal audits and reporting
C
Notes:
The majority of planned audits were implemented.
26.4 Response to internal audits
B
Notes:
Most internal audits receive adequate responses.
VI. Accounting and reporting
Scores by Dimension
Overall Indicator Score
27. Financial data integrity
B
Notes:
27.1 Bank account reconciliation
C
Notes:
Automated bank reconciliation takes place through the Treasury system. Tax transactions are reconciled daily. But the Social Fund remains outside TSA and is subject only to quarterly reconciliation.
Notes:
Limited use of suspense accounts is made. but balances are cleared in a timely manner.
Notes:
Processes are in place to ensure prompt clearance of advance accounts. Outstanding advances to contractors are reconciled at year end.
27.4 Financial data integrity processes
A
Notes:
Access to systems is restricted and recorded, but there is no separate unit responsible for ensuring data integrity.
28. In-year budget reports
A
Notes:
28.1 Coverage and comparability of reports
A
Notes:
Reports are complete and consistent with budgets.
28.2 Timing of in-year budget reports
B
Notes:
Monthly periodic reports on budget implementation are prepared by the 25th of the following month.
28.3 Accuracy of in-year budget reports
B
Notes:
There are no concerns regarding data accuracy, but commitments are not captured.
29. Annual financial reports
C+
Notes:
29.1 Completeness of annual financial reports
A
Notes:
Financial reports contain details of revenue, expenditure, cash flow, short and long-term liabilities, and financial and nonfinancial assets. There are no guarantees.
29.2 Submission of reports for external audit
B
Notes:
The annual financial statements were provided for external audit on 11 May 2020.
29.3 Accounting standards
C
Notes:
Accounting standards are consistent and disclosed but more progress towards international public sector accounting standards is required (and planned)
VII. External scrutiny and audit
Scores by Dimension
Overall Indicator Score
Notes:
30.1 Audit coverage and standards
B
Notes:
Most revenue and expenditure is audited using national audit standards with an increasing amount of compliance with international audit standards.
30.2 Submission of audit reports to the legislature
B
Notes:
The audited financial statements were submitted to the legislature between 3 and 6 months after their receipt.
30.3 External audit follow-up
A
Notes:
Follow-up is systematic and ensures attention is paid to audit findings and recommendations.
30.4 Supreme Audit Institution independence
A
Notes:
The Chamber of Accounts has substantial independence over its operations and its financing.
31. Legislative scrutiny of audit reports
A
Notes:
31.1 Timing of audit report scrutiny
A
Notes:
Scrutiny of audit reports was completed within 6 weeks for each of the last 3 years.
31.2 Hearings on audit findings
A
Notes:
In-depth hearings take place with all budgetary entities.
31.3 Recommendations on audit by the legislature
A
Notes:
Recommendations are made and systematically followed up.
31.4 Transparency of legislative scrutiny of audit reports
A
Notes:
Public debates take place and reports are published on the Parliament’s website.