Argentina 2019

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Aggregate expenditure outturn was 10% higher than the initial budget in two of the past three fiscal years considered.

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Variance in expenditure composition by administrative classification was below 10% in the three completed fiscal years considered.

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Variance in expenditure composition by economic classification was below 10% in two of the three completed fiscal years considered.

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Central government budget does not include a contingency item or vote.

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Actual revenue was higher than the initial budget value by more than 12% in two of the last three completed fiscal years.

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Revenue variance composition is higher than 10% in two of the fiscal years considered, but only in one exceeds the upper margin of 15%.

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The same budget and accounting structures are consistently applied throughout the budget formulation, execution, and reporting cycle according to organizational (administrative) units, function/sub-function, economic, and programmatic classifications.

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The budget proposal submitted to the Legislature includes 4 of the 4 the basic elements required for adequate scrutiny and 6 of the 8 additional elements.

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Expenditure outside financial reports, if it exists, is insignificant (less than 1%) in relation to budgetary central government expenditure.

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Revenue outside financial reports, if it exists, is insignificant (less than 1%) in relation to budgetary central government revenue collection.

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At least 94% of all central government extrabudgetary institutions submitted detailed financial reports for 2018 within 6 months of the end of the fiscal year.

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All transfers to provinces are based on a clear and transparent set of rules.

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In 2018, subnational governments (SNGs) received information on transfers through the budget cycle that allowed them at least 6 weeks to complete their budgets planning.

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Information published annually for budget program allocations shows that most of the central government budget entities include performance indicators for outputs, but not yet for outcomes.

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Reports published quarterly and annually show performance in relation to most output indicators, but not yet outcome indicators.

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This dimension is not applicable for the evaluation.

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No evaluations of performance of service delivery have been undertaken in the past three completed fiscal years.

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The government makes available to the public 4 basic elements and 3 additional elements, in accordance with the specified timeframes.

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Annual audit reports for most public corporations are issued and published within 9 months of the fiscal year-end.

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Less than 50% of unaudited financial reports are published annually within 9 months of the following fiscal year.

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The central government and decentralized entities include significant contingent liabilities in notes to their financial statements.

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Economic analyses are carried out, in accordance with national guidelines, to assess most major investment projects, by an entity other than the one that promotes the project. However, the results of these analysis are not published.

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There is no entity that performs centralized prioritization of investment projects.

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While certain projections are made, they are at the level of works and not of large investment projects. It is also not possible to link these projections with the project reference in BAPIN.

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The total cost and physical progress of major investment projects are monitored by the executing agencies. Information on implementation of major investment projects is prepared on a quarterly basis.

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Central government keeps records on the main categories of financial assets, but it does not recognize the total of those assets at fair or market value, and it does not publish information on the performance of the portfolio of all managed financial assets.

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Although central government maintains a information disclosing their use or status of preservation and aging.

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Procedures and rules for the transfer or disposal are established by legislation, regulations, and/or approved procedures. Partial information on transfers and disposals is published.

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Public debt management registering and reporting is undertaken according international standards.

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The Finance Secretary is the single entity authorized by Law to approve national public sector borrowing.

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There is only a two-year debt management document that is part of the two-year Financial Program.

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The government prepares macroeconomic forecasts for a full set of key indicators, but these forecasts are not published. A mandated set of these estimates is presented to the Federal Council for Fiscal Responsibility and published, but the estimates are not formally reviewed. estimates are also included in the documents presented to the Legislature with a discussion of their underlying assumptions. These documents are also published.

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The government prepares fiscal forecasts for the budget year and two years into the future for internal use.

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Macrofiscal forecasts prepared include some qualitative assessments of the effects of alternative assumptions.

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The government prepares estimates of the future fiscal impact of all proposed changes in revenue and expenditure, but these are not presented to the Legislature.

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The central government has explicit, published, time-based fiscal targets for three years, which have been submitted to the Legislature and are supported by fiscal rules embedded in legislation.

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The central government prepares reports on the progress made against its fiscal strategy, but these are yet to be formally submitted to the Legislature.

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The multi-annual budget for 2019-2021 presents expenditure estimates for three fiscal years disaggregated by all required classifications: administrative, economic, functional, and programmatic.

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Aggregate expenditure ceilings for the budget year and two more fiscal years are approved by the government and distributed among all central budgetary entities before the first budget circular is issued.

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There are very few medium-term strategic plans prepared by ministries, but all prepare budget sector programs with cost estimates and production targets, which have recently been used to test their alignment with government policy objectives.

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There is no documentation that explains changes in expenditure estimates between different multi-annual budgets.

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A budget calendar exists, it is strictly adhered to, and provides budgetary institutions with more than 4 weeks to complete their detailed institutional budget proposals.

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A budget circular is issued to budgetary units, including ceilings for total expenditure for the full fiscal year. The budget estimates are reviewed and approved by Cabinet after they have been completed in every detail by budgetary units.

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The Executive submitted the annual budget proposal to the Legislature three-and-ahalf months before the start of the corresponding fiscal year in all three fiscal years considered.

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The Legislature’s scrutiny of the budget includes fiscal policies, medium-term fiscal forecasts, and details of expenditure and revenue. It did not review the mediumterm priorities embedded in the multiannual budget.

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Legislative procedures were approved before revision of the budget proposal and they are respected and adhered to. They include review by specialized committees, technical support, public consultations, and negotiation procedures.

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The Legislature approved the budget, in all three fiscal years considered, before the start of the year for which it was intended.

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Clear rules exist which are adhered to, but these may allow for extensive administrative reallocations, including the expansion of total expenditure.

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Although FRCA collects most of the revenue of the country and disseminates comprehensive, easy to access, and updated information about main tax obligations, it does not provide information on the redress processes and procedures.

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There are no systematic and structured risk-management processes and procedures to assess/mitigate risk of tax non-compliance and promote voluntary compliance.

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FRCA does not yet have a single compliance improvement plan.

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The stock of revenue arrears at the end of 2018 is 3.24% of the total revenue collection of the year and the revenue arrears older than 12 months are 49.8% of total revenue arrears for the year.

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SIP reports on a monthly consolidated basis all the tax revenues by type of tax. Tax revenues represent 97 percent of the total tax and non-tax revenues.

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Daily, the National Treasury, provinces, and NSSA receive from the FRCA bank collecting accounts, the corresponding amounts established by law.

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No assessment, charges, transfers, or arrears reconciliation process between NTO and the collecting agencies according to the PEFA methodology and guidelines is undertaken.

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All balances are consolidated daily for both revenue and expenditure accounts.

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An annual cash flow forecast is prepared for the fiscal year and is updated monthly, based on the monitoring of revenue and payments.

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Public entities are aware of their cash availability beforehand and are able to plan and commit expenditures a quarter in advance.

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Frequent adjustments are made in the approved budget during the year, in accordance with a regulated review and approval process, and the affected parties are made aware of them in advance.

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Sufficient information is not available to establish the actual level of performance.

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Sufficient information is not available toestablish the actual level of performance.

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The monthly payroll of each entity, including any additions, is supported by approved documentation that has been verified against the files reflecting the approved conditions for each employee.

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Changes to be made to personnel and payroll records are updated at least monthly, generally before the next month’s payments are made. Retroactive adjustments and payments by the central government at the time of the evaluation amounted to 2.3 percent of the wage bill.

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Independent internal controls are used throughout the payroll preparation and payment process. These controls include restricted authority for approvals and restrictions for the introduction of changes in records. The applications used provide for the entry of changes and other actions to ensure the quality and integrity of the payroll.

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Partial payroll audits have been conducted in each of the last three years

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Two e-procurement systems centralizing procurement data in NPO databases have been gradually implemented, and NPO has collected the information on public works not included in the systems, covering the major part of capital expenditures from the 5-largest procuring sectors in 2018, including bidding and awarded contracts. However, the level of implementation of the e procurement system for public works as of December 2018 indicates that a large part of public expenditure in procurement was not being recorded in a complete and precise database during that year.

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Although the analysis of available information from NPO’s e-procurement systems and databases indicates at least 60% of the amount is executed using competitive methods, there is not comprehensive measurement for all categories of expenditure.

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The information displayed publicly enables access to 5 of the 6 key elements.

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The complaint system does not ensure access to an external and independent entity that does not participate in the procurement process. Complaints are addressed by the procuring entity.

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Current regulations provide for the separation of incompatible duties, and institutional responsibilities for the budget execution process have been formally established.

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Manual and electronic internal controls prevent expenditure commitments from being made outside the approved budget and without the availability of funds.

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It was verified that the majority of payments are compliant with regular payment procedures.

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Internal audit function operational within all central government entities.

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IAUs do not have annual reports on the structure and effectiveness of each entity’s internal control system, nor do their audit plans include an analysis of the coverage of their work with respect to the revenues and expenses executed by each entity. Their practice conforms to internal auditing standards that have yet to be updated to bring them into line with international standards.

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Annual internal audit plans and programs exist and are almost fully completed.

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The response by most entities to internal audit recommendations is partial.

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The bank accounts composing the Annual Financial Report are reconciled annually within 5 months of the close of the reference fiscal year.

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The chart of accounts does not provide for any suspense account. Information is disclosed in notes to the financial statements.

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The advance accounts are reconciled annually as part of the preparation of the annual financial reports, within 6 months of the close of the financial year.

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Access and changes to records are subject to strict security protocols and result in an audit trail. Data integrity is supervised on a continual basis by the Systems Audit Directorate of NAO.

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Several in-year reports are prepared by NBO. Coverage and classification of these reports comprehensively account for expenditures and comparison with budget estimates. Expenditures made from transfers to decentralized units within the central government are included in the reports.

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Budget execution reports are prepared monthly/quarterly and issued within 8 weeks from the end of each period.

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There are no major concerns regarding data accuracy. Data on expenditure is provided at commitment, accrual, and payment stages in different reports. Analysis is made quarterly.

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Financial reports for the BCG are prepared annually and include complete information on revenue, expenditure, physical and financial assets, liabilities, guarantees, and long-term obligations; they are comparable with the original approved budget and the modifications thereto. Basic financial statements are included, including a cash flow statement.

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The financial reports for the BCG were submitted for external audit within 7 months after the end of the fiscal year.

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The accounting standards applied to all reports are consistent with the country’s legal framework and current local accounting standards, and the standards are applied consistently. Reference is made to the application of such standards in the notes to the financial statements.

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There is insufficient information available to assess the performance level.

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There is insufficient information available to establish the actual level of performance.

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No statistics are available on follow-up to the recommendations made in AGO reports.

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In accordance with the Constitution and the law, AGO operates independently from the Executive with respect to the appointment and removal of its leadership, the formulation of its budget, the planning of its audits, the issuance of its reports, and access to the information required for its audits.

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There is no evidence of the timing of legislative scrutiny of external audit reports.

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There is no evidence of hearings held on key findings of AGO (SAI).

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No evidence was found on recommendations to the Executive based on the legislative scrutiny of audit reports.

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Committee reports are published; however, there is no evidence of publication of minutes or reports on legislative scrutiny of audits