FINLAND

The State auditors shall be entitled to obtain the information and documents they require from the authorities. Provisions regarding the right of the State auditors to obtain from elsewhere the information necessary for their work shall be prescribed by Act of Parliament.

For the purposes of auditing State finances and compliance with the budget there shall be the State Audit Office.

STATE AUDIT ACT (23 December 1947/967)

It shall be the task of the State Audit Office to audit the legality and appropriateness of the financial management of the State, as well as compliance with the budget. (4 December 1992/1211)

Also other tasks that are deemed to pertain to the activities of the State Audit Office may be entrusted to it by Decree.

The State Audit Office, hereinafter the Audit Office, shall belong to the ambit of the Ministry of Finance.

The Audit Office shall audit and control the financial management of State authorities, institutions and enterprises. Further, the Office shall also otherwise control and audit the use of State funds, the management of State assets and the pertinent accounting, within the limits eventually laid down by Decree. However, this task shall not include the audit and control of the financial management of Parliament and the funds supervised by Parliament, nor the operations of the Bank of Finland, Postipankki and the National Insurance Institution. (11 December 1981/856)

The Audit Office may audit the use and accounting of the funds of State-subsidised communities, corporations and bodies in order to determine whether the subsidies have been appropriately directed for their intended purpose. The Audit Office shall have a corresponding right to audit private funds in the care of the authorities, when the legislation in force provides that the State is responsible for the funds.

Separate provisions apply to the right of the Audit Office to audit the operations of those limited-liability companies where the State is the majority shareholder.

Anyone whose operations are by virtue of section 2, paragraph 1 or 2 subject to auditing or controlling by the Audit Office shall, upon request, display to the competent auditor or deliver to the Audit Office those books, account statements and other documents that are necessary for the purposes of auditing or controlling, and without delay provide the Office or the auditor with the information or explanations requested.

Where possible, audits shall be carried out in the municipality where the office, institution, enterprise or body is established or domiciled, and in its quarters.

Anyone who fails to comply with an order issued by virtue of section 6 or fails to deliver to the Audit Office, within the time limit set, a document or other material that according to other provisions is to be handed over to the Office, may be obligated by the Audit Office to do so under threat of a fine. The Audit Office may also use the threat of a fine so as to have the books, documents or other material in an order suitable for auditing.

If, in operations which by virtue of section 2, paragraph 1 are subject to controlling by the Audit Office, improper conduct has resulted in a loss for the State, the Audit Office shall notify the authority, institution or enterprise whose operations were controlled so as to have it undertake the necessary measures. If improper conduct has been observed in other use of funds referred to in section 2, paragraph 1 or 2, the notification shall be made to the State authority which generally controls the operations concerned.

If the impropriety observed involves only a minor amount and it is deemed that further action by the Audit Office or a rectification of the error would result in more work or expenses than the loss caused by the impropriety, the Audit Office may, within the limits laid down by Decree, waive any further measures.

When making a decision on a waiver referred to in paragraph 1, consideration shall be given to whether the improper conduct has been recurrent and whether further measures are called for on grounds of principle.

A State authority, institution and enterprise shall inform the Audit Office of the measures undertaken on the basis of the notification referred to in section 8.

If the improper conduct constitutes an offence and the authority, institution or enterprise referred to in section 8 does not undertake measures to have charges brought against the person concerned, the Audit Office shall undertake such measures.

If the offence is trivial, the Audit Office may waive the measures referred to in paragraph 1.

Separate provisions apply to the compensation payable to the State for damage caused in a civil service relationship.

The Audit Office shall provide the Council of State, the Parliamentary State Auditors and the Ministry of Finance with information on its activities, as provided by Decree.

This Act enters into force on 1 January 1948; it repeals the Act on State Audits (1931/126) and the Act on Military Audits (1941/778).

Matters undergoing a military audit at the entry into force of this Act shall be transferred to the State Audit Office.

STATE AUDIT DECREE (19 March 1993/267)

Tasks and organisation of the Audit Office

It shall be the task of the State Audit Office, in accordance with the State Audit Act (1947/967) and the restrictions provided in section 2, paragraph 1 of the said Act, to:

1) audit and control the financial management and accounting of State authorities and institutions, as well as audit and control the use of State funds, the management of State assets and the pertinent accounting also by others than State authorities;

2) audit and control compliance with the budget and the Acts, Decrees and Orders on the financial management and accounting of the State, the appropriateness of the financial management of the State, as well as adherence to the generally accepted business principles within State enterprises;

3) audit and monitor the granting of State subsidies and the use and accounting of the funds of State-subsidised communities, corporations and bodies in order to determine whether the provisions on State subsidies and the conditions imposed when granting the subsidies have been complied with, and whether subsidies have been appropriately directed for their intended purpose, as well as observe the monitoring of subsidy use;

4) audit private funds in the care of the authorities, when the legislation in force provides that the State is responsible for the funds;

5) mind and control that the improprieties and inadequacies observed during audits are rectified and that appropriate measures are undertaken to compensate the State for any loss incurred (18 October 1996/733);

6) keep up with the developments in its field of activity and, where necessary, make proposals for the amendment of those Acts, Decrees and Orders the compliance with which is controlled by the Audit Office, as well as other reform proposals it deems necessary; and (18 October 1996/733)

In addition, the Audit Office shall carry out the tasks laid down in the Act on the Auditing of the Operations of State-owned Limited-Liability Companies (1947/968) and monitor that such companies adhere to the generally accepted business principles, as well as carry out those other tasks that have been entrusted to the Audit Office by Act or Decree, or assigned to it by the Council of State within the limits of its field of activity.

Where necessary, the Audit Office shall provide the police with official assistance in their investigations.

The Audit Office shall consist of the Audit Council and such result areas as laid down in the rules of procedure.

The Audit Council shall consist of the Auditor General, as chairman, and Audit Councillors, as members.

The Audit Office may have an advisory board, whose members are appointed by the Council of State for a term not exceeding three years at a time.

The advisory board shall have a chairman and at most six other members, one of whom shall be an elected staff representative. The Auditor General shall act as the chairman.

1) maintain and develop the contacts of the Audit Office with various interest groups;

2) make initiatives for the improvement and development of auditing and audit conditions; and

3) maintain and develop the efficiency of auditing and the ability to service the various control organs in State administration.

The Audit Office shall have the post of Auditor General and other necessary posts.

The Auditor General shall be the head of the Audit Office; the head shall direct and develop the operations of the Audit Office and be responsible for its efficiency and the achievement of its objectives.

The head of a result area and another official in a supervisory position shall be responsible for the achievement of the objectives of the unit concerned.

Without prejudice to the confirmed allocation of duties, each official of the Audit Office shall perform the duties assigned to him by the Auditor General or the appropriate head of result area.

Resolutions on matters belonging to the Audit Office shall be made by the Audit Council, the Auditor General or another official.

The Audit Council shall make resolutions, upon presentation, on matters relating to:

4) the issuance of general guidelines to State authorities and institutions in the field of activity of the Audit Office.

In addition, the Audit Council shall consider those matters relevant to the Office that are brought before it by the Auditor General.

The Audit Council shall have a quorum with more than half of the members present, including the chairman.

In Audit Council sessions, disputes are resolved by a majority of votes. In the case of a draw the chairman shall have the casting vote.

The Auditor General shall make resolutions, upon presentation, on matters not resolved by the Audit Council nor assigned to another official by the rules of procedure or the Auditor General.

The Auditor General may decide, on a case-by-case basis, to reserve for himself the resolution of a matter normally resolved by a subordinate official.

The Audit Councillor nominated by the Ministry of Finance shall be the deputy of the Auditor General, when the latter is prevented from performing his duties. The deputies of the other officials shall be appointed by the Auditor General.

The ability and competence necessary for the successful performance of the pertinent duties shall be general prerequisites for appointment to the Audit Office. In addition, it is required that the Auditor

General has a suitable Master's degree and good knowledge of public finances and State administration.

The Auditor General shall be appointed, upon the proposal of the Council of State, by the President of the Republic; the post need not be advertised. The other officials shall be appointed by the Auditor General.

1) to the Auditor General, for at most one year, by the Ministry of Finance and, for longer than one year, by the Council of State; and

However, a leave of absence to which the official has a right by virtue of an Act, a Decree or the public officials' collective bargaining agreement shall be granted by the Audit Office.

An appointment to a post for a fixed period shall be made by the organ which, under section 16, paragraph 1, grants a leave of absence from that post.

Decisions on audits and any measures or statements following from them shall be made by the Audit Office.

When the investigation of a matter, any further action by the Audit Office or a rectification of the error is deemed to result in more work or expenses than the loss caused by the impropriety, the Audit Office may waive further measures. However, if the impropriety involves an amount exceeding FIM 10 000, a waiver shall not be issued unless there are extremely important reasons for the same.

If an abuse has been observed in funds managed by a state official or agency, this must immediately be reported to the Audit Office.

The authority, institution or State-owned limited-liability company shall be obligated, where necessary, to assist the competent auditor in carrying out the audit.

The Audit Office shall issue an annual report. The provisions in section 65 of the Budget Decree (1992/1243) shall apply to the annual report.

The Audit Office shall provide the Parliamentary State Auditors and the Ministry of Finance with its activity and financial plan and all the other information and documents necessary for their activities.

Without prejudice to the provisions in section 13, paragraph 1, and section 14 of the Budget Decree, the Audit Office shall confirm the objectives referred to in section 11 of the said Decree and notify the Ministry of Finance and the Parliamentary State Auditors of the same.

More detailed provisions on the internal allocation of duties and the organisation of the administration shall be issued in the rules of procedure. unless otherwise provided in this Decree. The rules of procedure shall be confirmed by the Auditor General.

Charges against the Auditor General for an offence in office shall be brought before the Helsinki Court of Appeal.

Measures required for the implementation of this Decree may be undertaken prior to its entry into force.

ACT ON THE RIGHT OF THE PARLIAMENTARY STATE AUDITORS AND THE STATE AUDIT OFFICE TO AUDIT CERTAIN CREDIT TRANSFERS BETWEEN FINLAND AND THE EUROPEAN COMMUNITIES

This Act applies to credit transfers between Finland and the European Communities and to the controlling and auditing of the use thereof. In this Act credit transfers mean the payment or account liabilities or other commitments of the State, municipalities, federations of municipalities, Finnish societies, societies operating in Finland, parishes and other societies, foundations, institutions, enterprises and individuals towards the European Communities, as well as the subsidies, loans, other financing, securities, exemptions or other forms of subsidy directed to Finland from the resources of the European Communities.

The reference in paragraph 1 to a recipient of a credit transfer from the European Communities shall mean also an intermediary and a person to whom the recipient has transferred the resources in question.

The Parliamentary State Auditors and the State Audit Office shall have the right to audit the credit transfers referred to in section 1 and the use and controlling thereof, as well as, to the extent required for auditing, the finances and operations of an intermediary, the grantor, the recipient and the payer of a credit transfer or a person to whom the recipient has transferred the resources he has received.

The Parliamentary State Auditors and the State Audit Office shall have the right to audit the credit transfers referred to in section 1 in the quarters of the recipients and those liable for payment; those audited shall assist the auditor in his task. The Parliamentary State Auditors and the State Audit Office may make use of expert advisors in the audit.

Without prejudice to separate provisions on the confidentiality of matters and documents, those audited shall without undue delay provide the Parliamentary State Auditors and the State Audit Office with the requested information, accounts, documents and records necessary for the audit.

The Parliamentary State Auditors and the State Audit Office shall have access to all information, documents, other records and copies in the possession of the regular auditors of those audited, where they are necessary for the audit, as well as copies of the memos, minutes and other documents concerning the operations of those audited and drafted by the regular auditor.

The authorities of the State, federations of municipalities, municipalities, and parishes shall give the Parliamentary State Auditors and the State Audit Office the official assistance necessary for the access and the right of audit referred to in this Act, as well as provide them with the information, documents and other records and accounts concerning those audited and necessary for the audit.

Regardless of the obligation to maintain secrecy prescribed in the Act on the Publicity of Official Activities (621/1999), information obtained in performing tasks under this Act regarding another person's economic position, business or professional secrets or an individual's personal conditions may be handed over to police and other pretrial authorities, customs and prosecution authorities and courts in order to investigate a crime and to the European Communities' organs and other competent authorities if legislation so requires.

The provisions in other Acts on the Parliamentary State Auditors and the State Audit Office shall otherwise apply to monitoring and auditing activities referred to in this Act.

Measures required for the implementation of this Act may be undertaken prior to its entry into force.

FINLAND

Finland

THE CONSTITUTION ACT OF FINLAND (17 July 1919/94)

STATE AUDIT ACT (23 December 1947/967)

STATE AUDIT DECREE (19 March 1993/267)

Tasks and organisation of the Audit Office

State audit officials and their duties

Consideration and resolution of matters

Appointment and leave of absence

Auditing and reports

Miscellaneous provisions

Entry into force

ACT ON THE RIGHT OF THE PARLIAMENTARY STATE AUDITORS AND THE STATE AUDIT OFFICE TO AUDIT CERTAIN CREDIT TRANSFERS BETWEEN FINLAND AND THE EUROPEAN COMMUNITIES