SNG PILLAR: INTERGOVERNMENTAL FISCAL RELATIONS
Scores by Dimension
Overall Indicator Score
HLG-1 Transfers from Higher Levels of Government
D+
Notes:
HLG-1.1 Outturn from higher-levels of government
D
Notes:
The outturns for FYs 2016, 2017, and 2018 were 196.88%, 178.24%, and 174.42%, respectively. While the deviation of actual grants from the original budgeted grants steadily declined, it was above 116% in all three FYs.
HLG-1.2 Transfers composition outturn
D*
Notes:
There is no information of transfer composition in the budget document, although the compositions are provided in the actual budget.
HLG-1.3 Timeliness of transfers from higher-levels of government
A
Notes:
A disbursement timetable is prescribed by law and agreed between the HLG and the County Government. More than 75% of actual transfers have been on time in two of the last three years.
HLG-1.4 Predictability of transfers
D
Notes:
The HLG provides only partial information on transfers for the coming FY, and there is no explanation for changes between the current and the previous FY.
HLG-2 Fiscal rules of monitoring of fiscal position
NU
Notes:
HLG-2.1 Fiscal rules for subnational governments
NU
Notes:
HLG-2.2 Debt rules for subnational governments
NU
Notes:
HLG-2.3 Monitoring of subnational governments
NU
Notes:
I. BUDGET RELIABILITY
Scores by Dimension
Overall Indicator Score
PI-1 Aggregate expenditure out-turn
D
Notes:
PI-1.1 Aggregate expenditure out-turn
D
Notes:
Aggregate expenditure outturn deviated significantly from the budgeted amounts in the last three FYs. The outturn was 150.50%, 152.10%, and 155.19% of the approved budget, respectively.
PI-2 Expenditure composition outturn
D+
Notes:
PI-2.1 Expenditure composition outturn by function
D
Notes:
Variance in expenditure composition by functional classification was above 15% in each of the last three FYs. Variance of the three years was 77.95%, 49.15%, and 50.98%, respectively.
PI-2.2 Expenditure composition outturn by economic type
NA
Notes:
There was no economic classification for the GFB in FYs 2016-2018 (referring to PI-4.1).
PI-2.3 Expenditure from contingency reserves.
A
Notes:
In FYs 2016-2018, actual expenditure charged to a contingency vote was on average 0.60% of the original budget (i.e. less than 3% of the original budget).
Notes:
PI-3.1 Agregate revenue outturn
B
Notes:
In FYs 2016 - 2018, the variance in aggregate revenue was 103.63%, 111.09%, and 131.54%, respectively. The actual revenues were between 94% and 112% of budgeted revenues in two of the three FYs.
PI-3.2 Revenue composition outturn
D
Notes:
Composition variance in revenue collection in the three FYs was 38.82%, 38.77%, and 105.24%, respectively, all more than 15%.
II. TRANSPARENCY OF PUBLIC FINANCES
Scores by Dimension
Overall Indicator Score
PI-4 Budget Classification
D
Notes:
PI-4.1 Budget Classification
D
Notes:
Budget documentation is nationally consistent. The GPB is based on functional and economic classification, but the GFB is only based on functional classification.
PI-5 Budget Documentation
C
Notes:
PI-5.1 Budget Documentation
C
Notes:
Budget documentation contains three basic elements and no additional element.
PI-6 Subnational government operations outside financial reports
A
Notes:
PI-6.1 Expenditure outside financial reports
A
Notes:
All expenditures are included in the budget/financial reports.
PI-6.2 Revenue outside financial reports
A
Notes:
All revenues are included in the budget/financial reports.
PI-6.3 Financial reports of extrabudgetary units
A
Notes:
The social insurance fund budget is included in the budget execution report and submitted to the government within three months of the end of the FY.
PI-7 Transfers to subnational governments
NA
Notes:
PI-7.1 System for allocating transfers
NA
Notes:
There are no separate lower-level SNGs, rather deconcentrated units of the County Government.
PI-7.2 Timeliness of information on transfers
NA
Notes:
There are no separate lower-level SNGs, rather deconcentrated units of the County Government.
PI-8 Performance information for service delivery
C
Notes:
PI-8.1 Performance plans for service delivery
C
Notes:
No information on policy or program objectives is published. 74.22% of the ministries published the activities to be performed under the policies or programs in FY 2019.
PI-8.2 Performance achieved for service delivery
D
Notes:
No information is published about the quantity of outputs produced or outcomes achieved.
PI-8.3 Resources received by service delivery units
A
Notes:
Based on the selected Education Department and Public Health Department, there are no reports compiling information on resources received by frontline service delivery units.
PI-8.4 Performance evaluation for service delivery
D
Notes:
Published third-party evaluations accounted for 0.3% of service delivery expenditure in FY 2018, and there was no published self-evaluation.
PI-9 Public access to fiscal information
D
Notes:
PI-9.1 Public access to fiscal information
D
Notes:
The Youxian Government makes available to the public one basic elements within the specified time frame.
9bis Public consultation
NU
Notes:
9bis.1 Public consultation in budget preparation
NU
Notes:
9bis.2 Public consultation in the design of service delivery programs
NU
Notes:
9bis.3 Public consultation in investment planning
NU
Notes:
III. MANAGEMENT OF ASSETS AND LIABILITIES
Scores by Dimension
Overall Indicator Score
PI-10 Fiscal risk reporting
C+
Notes:
PI-10.1 Monitoring of public corporations
C
Notes:
All 10 largest PCs in Youxian submitted financial reports to the Government, and 9 of 10 PCs that submitted their financial reports within 9 months of the end of the FY.
PI-10.2 Monitoring of subnational governments
NA
Notes:
There are no lower-SNGs in Youxian.
PI-10.3 Contingent liabilities and other fiscal risks
B
Notes:
Guarantees are recorded in the Government Debt Management System. Data are updated and consolidated monthly. But information on contingent liabilities is not published.
PI-11 Public investment management
D+
Notes:
PI-11.1 Economic analysis of investment proposals
D
Notes:
In FY 2018, no economic analysis was conducted for any major investment project.
PI-11.2 Investment project selection
B
Notes:
All major investment projects are selected and prioritized by the government executive on the basis of standard criteria for project selection.
PI-11.3 Investment project costing
D
Notes:
Investment project costing information is not included in the budget documents.
PI-11.4 Investment project monitoring
C
Notes:
The MIPO monitors total cost and physical progress monthly. Information on the implementation of major investment projects is prepared monthly.
PI-12 Public asset management
B
Notes:
PI-12.1 Financial asset monitoring
C
Notes:
The Youxian Government maintains records of its holdings in all major categories of financial assets, which are recognized at book value. Information on the aggregate value of financial assets is submitted to the People’s Congress annually but not published.
PI-12.2 Nonfinancial asset monitoring
C
Notes:
The Youxian Government maintains records of its holdings of fixed assets and collects partial information on their usage and age. The information on non-financial assets is mostly not available to the public.
PI-12.3 Transparency of asset disposal
A
Notes:
Procedures and rules for the transfer or disposal of financial and non-financial assets are established. Information on asset disposal is included in the state-owned assets management report submitted to the People’ s Congress.
Notes:
PI-13.1 Recording and reporting of debt and guarantees
C
Notes:
Debt records are complete, accurate, and updated when transactions are made. They are updated monthly via the debt management system. Reconciliations are performed annually, the relating information being recorded in the system.
PI-13.2 Approval of debt and guarantees
A
Notes:
The Youxian Finance Bureau is the responsible debt management entity and is authorized to borrow on behalf of the County Government and monitor debt transactions according to the debt management rules.
PI-13.3 Debt management strategy
D
Notes:
There is no medium-term DMS including target ranges for indicators such as interest rates, refinancing or foreign currency risks.
IV. POLICY-BASED FISCAL STRATEGY AND BUDGETING
Scores by Dimension
Overall Indicator Score
PI-14new Medium term budget strategy
D+
Notes:
PI-14new.1 Underlying forecasts for medium-term budget
C
Notes:
Budget preparation is based on information of transfers, revenue, and expenditure, but the referred data are not submitted to the legislature.
PI-14new.2 Fiscal impact of policy proposals
D
Notes:
There are no estimates of the fiscal impact of proposed changes in revenue and expenditure policy for the FY.
PI-14new.3 Medium-term expenditure and revenue estimates
D
Notes:
No medium-term expenditure and revenue estimates are prepared.
PI-14new.4 Consistency of budgets with previous year's estimates
NA
Notes:
No medium-term expenditure and revenue estimates are prepared.
PI-14 Macroeconomic and fiscal forecasting
NU
Notes:
PI-14.1 Macroeconomic forecasts
NU
Notes:
PI-14.2 Fiscal forecasts
NU
Notes:
PI-14.3 Macro-fiscal sensitivity analysis
NU
Notes:
Notes:
PI-15.1 Fiscal impact of policy proposals
NU
Notes:
PI-15.2 Fiscal strategy adoption
NU
Notes:
PI-15.3 Reporting on fiscal outcomes
NU
Notes:
PI-16 Medium term perspective in expenditure budgeting
NU
Notes:
PI-16.1 Medium-term expenditure estimates
NU
Notes:
PI-16.2 Medium-term expenditure ceilings
NU
Notes:
PI-16.3 Alignment of strategic plans and medium-term budgets
NU
Notes:
PI-16.4 Consistency of budgets with previous year estimates
NU
Notes:
PI-17 Budget preparation process
C+
Notes:
Notes:
A clear annual budget calendar exists and is adhered to. It provides budgetary units slightly less than 6 weeks from receipt of the budget circular to meaningfully complete their detailed estimates on time.
PI-17.2 Guidance on budget preparation
B
Notes:
The budget circular covers total budget expenditure for the full FY. The approved expenditure ceilings were provided after the distribution of the budget circular to the budget units, but before the budget units submitted their revised budget.
PI-17.3 Budget submission to the subnational council
D
Notes:
Budget submission to the legislature took place around or after the beginning of the FY for all three FYs.
PI-18 Legislative scrutiny of budgets
C+
Notes:
PI-18.1 Scope of budget scrutiny
B
Notes:
Budget scrutiny by the Youxian People’s Congress covers details of expenditure, revenue, and fiscal policies, but not medium-term fiscal forecasts and medium-term priorities.
PI-18.2 Legislative procedures for budget scrutiny
B
Notes:
Procedures for reviewing budget proposals are approved by the Youxian People’s Congress in advance of budget hearings and are adhered to.
PI-18.3 Timing of budget approval
C
Notes:
The subnational legislature approved the annual budget within one month of the start of the FY in two of the last three FYs.
PI-18.4 Rules for budget adjustments by the executive
C
Notes:
The Budget Law sets rules and procedures for in-year budget adjustment by the executive. These rules are adhered to in some instances.
V. PREDICTABILITY AND CONTROL IN BUDGET EXECUTION
Scores by Dimension
Overall Indicator Score
PI-19 Tax administration
NA
Notes:
PI-19.1 Rights and obligations for tax measures
NA
Notes:
PI-19.2 Property tax register and value assessment
NA
Notes:
PI-19.3 Tax risk management, audit and investigation
NA
Notes:
PI-19.4 Tax arrears monitoring
NA
Notes:
PI-20 Accounting for revenue
A
Notes:
PI-20.1 Information on revenue collections
A
Notes:
The Youxian Government obtains revenue data at least monthly from the collecting units.
PI-20.2 Transfer of revenue collections
A
Notes:
All tax revenues collected are transferred directly to the TSA on a daily basis.
PI-20.3 Tax accounts reconciliation
NA
Notes:
Governments at county level are not authorized to administrate and collect taxes. The duty of tax revenue reconciliation is NA.
PI-21 Predictability of in-year resource allocation
D
Notes:
PI-21.1 Consolidation of cash balances
C
Notes:
The bank account balances of the Treasury accounts are consolidated daily, while the bank account balances of special accounts are consolidated monthly.
PI-21.2 Cash forecasting and monitoring
D
Notes:
The Youxian Finance Bureau does not conduct comprehensive cash flow forecasting and monitoring.
PI-21.3 Information on commitment ceilings
D
Notes:
Budgetary units are not provided reliable information on commitment ceilings.
PI-21.4 Significance of in-year budget adjustments
D*
Notes:
Significant budget adjustments happen, but details for each budget adjustment are not available.
PI-22 Expenditure arrears
D
Notes:
PI-22.1 Stock of expenditure arrears
D*
Notes:
Since Youxian County has not set up a monitoring system for expenditure arrears, data on the stock of arrears are not available.
PI-22.2 Expenditure arrears monitoring
D
Notes:
There is no monitoring system for expenditure arrears in Youxian County.
Notes:
PI-23.1 Integration of payroll and personnel records
A
Notes:
The approved employee list, personnel database and payroll are directly interlinked through an IT system and updated on real time basis, effectively ensuring budget control, data consistency, and monthly reconciliation.
PI-23.2 Management of payroll changes
A
Notes:
Necessary changes to personnel records and payrolls are updated inreal time.
PI-23.3 Internal control of payroll
A
Notes:
A complete internal control system is in place for changes to the payroll. The e-financial management system assigns unique passwords and identification numbers to each approver to ensure the approval process can be traced, and the integrity of data is warranted.
Notes:
A special review team to identify and prevent the occurrence of ‘ghost employees’ inspects all budgetary units once a year.
Notes:
PI-24.1 Procurement monitoring
D*
Notes:
The contract data for small contracts are not available, and there is no sound document to facilitate the assessment of this dimension.
PI-24.2 Procurement methods
D*
Notes:
Since contract data for small contracts are not available, it is not feasible to calculate the total value of contracts awarded through competitive methods.
PI-24.3 Public access to procurement information
D
Notes:
One out of six criteria is met.
PI-24.4 Procurement complaints management
A
Notes:
All six criteria are met.
PI-25 Internal controls on nonsalary expenditure
B
Notes:
PI-25.1 Segregation of duties
A
Notes:
Segregation of duties is prescribed throughout the whole budget execution process with responsibilities clearly defined for each stage.
PI-25.2 Effectiveness of expenditure commitment controls
D
Notes:
Some expenditures take place outside the control. Cash-based accounting is still widely used, and some payables are not recorded by the budget units.
PI-25.3 Compliance with payment rules and procedures
A
Notes:
Compliance with payment rules and procedures is very high (more than 90%), and all exceptions are authorized in advance.
Notes:
PI-26.1 Coverage of internal audit
D
Notes:
Internal audit is operational for budget units representing 30.96% of total budgeted expenditure.
PI-26.2 Nature of audits and standards applied
B
Notes:
Internal audit activities focus on internal control and risk audit. The internal audit work is guided by the Internal Audit Standards. However, internal audit quality assurance is not established in Youxian.
PI-26.3 Implementation of internal audits and reporting
D
Notes:
In 2018, the budget units of Youxian that carried out internal audit did not prepare internal audit work plans.
PI-26.4 Response to internal audits
D
Notes:
During 2016 to 2018, management of audited budget units did not respond to audit recommendations.
VI. ACCOUNTING AND REPORTING
Scores by Dimension
Overall Indicator Score
PI-27 Financial data integrity
B
Notes:
PI-27.1 Bank account reconciliation
B
Notes:
Reconciliation of all bank accounts is completed within 15 days after the end of each month.
PI-27.2 Suspense accounts
NA
Notes:
There are no suspense accounts in Youxian County.
PI-27.3 Advance accounts
NA
Notes:
There are no advance accounts in Youxian County.
PI-27.4 Financial data integrity processes
B
Notes:
Access and changes to the financial data information system are restricted, must be authorized in advance, and are secured by a U-shield and password. Both result in an audit trail. The system is managed by the Information Center at the Finance Bureau, which passed the organized safety and quality test. But there is no unit in charge of verifying financial data integrity.
PI-28 In-year budget reports
B+
Notes:
PI-28.1 Coverage and comparability of reports
A
Notes:
Monthly budget execution and quarterly analysis reports are prepared. All revenues and expenditures including those for deconcentrated SNG units are included in the in-year budget reports. Coverage and classification of data are comparable with the original budget.
PI-28.2 Timing of in-year budget reports
A
Notes:
Budget execution reports are prepared monthly, and all of them are published on the website of the Finance Bureau within two weeks of the end of the reported month.
PI-28.3 Accuracy of in-year budget reports
B
Notes:
There are no concerns regarding data accuracy. Data are reliable and useful for the analysis of budget execution which is prepared quarterly. However, information on expenditure is covered at payment and not at commitment stage.
PI-29 Annual financial reports
D+
Notes:
PI-29.1 Completeness of annual financial reports
C
Notes:
Annual budget execution reports are prepared and are comparable with the approved budget. The reports include information on revenue, expenditure, and cash balances, but do not provide any information on financial and tangible assets.
PI-29.2 Submission of reports for external audit
A
Notes:
The 2018 budget execution report was submitted to the Audit Bureau within 3 months of the end of the FY.
PI-29.3 Accounting standards
D
Notes:
The budget execution reports for FY 2016-2018 were prepared in line with the national standards stipulated by the MOF. However, the accounting standards adopted were not disclosed in notes or other parts of the financial reports.
VII. EXTERNAL SCRUTINY AND AUDIT
Scores by Dimension
Overall Indicator Score
Notes:
Notes:
In FYs 2016-2018, for budget units carried out external audit, the expenditure of budget units accounted for 64.97% of total expenditures.
PI-30.2 Submission of audit reports to the subnational council
B
Notes:
In FYs 2016-2018, the audit reports on budget execution were submitted to the City People’s Congress within 6 months upon receipt of the financial reports.
PI-30.3 External audit follow-up
A
Notes:
The rectification reports show that in FYs 2016-2018, required follow-up action on the issues disclosed by auditors was taken by the concerned entities effectively and timely.
PI-30.4 Independence of the public audit institution in charge of subnational governments
B
Notes:
The Audit Law and related regulations provide concrete basis to secure the independence of the SAI.
PI-31 Legislative scrutiny of audit reports
B
Notes:
PI-31.1 Timing of audit report scrutiny
A
Notes:
The time period between the issuance of the audit report and its scrutiny by the People’s Congress was less than three months for all FYs 2016-2018.
PI-31.2 Hearings on audit findings
B
Notes:
Besides the directors of the Finance Bureau and the Audit Bureau, representatives from most of the audited entities are required to attend the hearing.
PI-31.3 Recommendations on audit by subnational council
A
Notes:
The subnational legislature issues recommendations on actions to be implemented by the executive and systematically follows up on their implementation.
PI-31.4 Transparency of legislative scrutiny of audit reports
D
Notes:
The scrutiny process is carried out only between the members of the Standing Committee and several chiefs from the governmental departments. Access is not provided to the general public.