Global Integrity Report

Kazakhstan Home

Facts

Timeline

Notebook

Integrity Scorecard

2007 Assessment

Kazakhstan: Integrity Indicators Scorecard

Kazakhstan: Integrity Scorecard Report > Sub-Category: State-Owned Enterprises
Indicators		Score
64	In law, is there an agency or equivalent mechanism overseeing state-owned companies?	100
65	Is the agency or equivalent mechanism overseeing state-owned companies effective?	75
66	Can citizens access the financial records of state-owned companies?	95

Indicator and sub-Indicator Details

In law, is there an agency or equivalent mechanism overseeing state-owned companies?

64: In law, is there an agency or equivalent mechanism overseeing state-owned companies?

Score:

YES

Comments:

References: Kazakhstan State Holding on Management of State Assets. [ LINK ])=1

Presidential decree of Jan. 28, 2006 [ LINK ]

Is the agency or equivalent mechanism overseeing state-owned companies effective?

65a: In law, the agency or equivalent mechanism overseeing state-owned companies is protected from political interference.

Score:

YES

Comments:

References: Resolution of the government from Feb. 23, 2006 On the measures of realization of the decree of the president of the Republic of Kazakhstan from Jan. 28, 2006 [ LINK ]

65b: In practice, the agency or equivalent mechanism overseeing state-owned companies has a professional, full-time staff.

Score:

100

Comments:

References: Article Aleksandr Konstantinov Mythical Bird Samruk (in Russian) Expert Kazakhstan Feb. 6, 2006 [ LINK ];

Interview with Sauat Mynbayev, executive director of Samruk Holding Feb 2, 2006 [ LINK ]

Peer Review Comments: There is a need for capacity building in the agency.

65c: In practice, the agency or equivalent mechanism overseeing state-owned companies receives regular funding.

Score:

100

Comments:

References: Article Aleksandr Konstantinov Mythical Bird Samruk (in Russian) Expert Kazakhstan Feb. 6, 2006 [ LINK ];

Interview with Sauat Mynbayev, executive director of Samruk Holding Feb 2, 2006 [ LINK ]

65d: In practice, when necessary, the agency or equivalent mechanism overseeing state-owned companies independently initiates investigations.

Score:

100

Comments: It can initiate investigations through the Committee on the Competition Protection.

References: News report staff of Expert Kazakhstan On Equal Terms But Not Our Terms (in Russian) May 28, 2007 [ LINK ];

Interview with Sauat Mynbayev, executive director of Samruk Holding Feb 2, 2006 [ LINK ]

65e: In practice, when necessary, the agency or equivalent mechanism overseeing state-owned companies imposes penalties on offenders.

Score:

100

Comments: The holding was created more or less a year ago; so far they reported to Parliament once and started one case against the under-performing of the investment program by the company in which the state has 50 percent in stakes.

References: News report staff of Expert Kazakhstan On Equal Terms But Not Our Terms (in Russian) May 28, 2007 [ LINK ];

Interview with Sauat Mynbayev, executive director of Samruk Holding Feb 2, 2006 [ LINK ]

Can citizens access the financial records of state-owned companies?

66a: In law, citizens can access the financial records of state-owned companies.

Score:

YES

Comments: usually it is very difficult to get the reports. They usually have a very general character. The aforementioned statement has little judicial power.

References: Statement of the Government of Kazakhstan and National Bank from Jan. 27, 2007 On Main Directions of Economic And Social Policies And Prospects of Economic Indicators for 2007 [ LINK ];

Order # 89 of the Ministry of Finance from June 18, 2004 On Confirmation of The Structure of Divisions, Forms and Lists of Indicators for The Plans of National Companies www.minfin.kz/structure/data/@028;0999.doc

Peer Review Comments: Financial records of state or other companies are opaque.

66b: In practice, the financial records of state-owned companies are regularly updated.

Score:

100

Comments: The financial activities of the companies provoked a public scandal when the information on the unbelievably high salaries of the top managers (more than US$300,000 per month) was published [ LINK ]

Usually citizens are not interested in this issue, however a coalition of NGOs for several years is working on EITI initiative and some pressure to make these report more available is present. When company needs auditing from big 4 then usually all the reports are published on the websites of the companies.

References: Final report 2007 Staff of Samruk holding Report about the activities of Open Stock Company "Kazakhstan Holding on Management of State Assets Samruk" 2006 [ LINK ])=1

News report. Staff of Kazpochta company Meeting of the Board of directors of AO Kazpochta July 16, 2007 [ LINK ]

Peer Review Comments: There is still little access given.

66c: In practice, the financial records of state-owned companies are audited according to international accounting standards.

Score:

100

Comments: The biggest national companies order audits from Big 4.

References: Annual report 2006 Kazpochta staff Kazpochta. Annual report for 2005 (Audit was done by Deloitte) [ LINK ]

Peer Review Comments: The audit companies in Kazakhstan face pressures in their audits and have numerous other financial considerations and conflicts of interest in their operations in the country.

66d: In practice, citizens can access the financial records of state-owned companies within a reasonable time period.

Score:

100

Comments: All reports are available, but companies are criticized for the small dividends paid to the state, internal prices, insider deals and large budgets.

References: Annual report of National railways company 2005 Consolidated Financial Statement of National Company Kazakhstan Temir Zholy [ LINK ]

News report Anatoli Vaiskopf Deutsche Welle Kazakhstan New Financial Scandal July 13, 2005 [ LINK ]

66e: In practice, citizens can access the financial records of state-owned companies at a reasonable cost.

Score:

100

Comments:

References: Annual report of National railways company 2005 Consolidated Financial Statement of National Company Kazakhstan Temir Zholy [ LINK ]

News report. Anatoli Vaiskopf Deutsche Welle Kazakhstan New Financial Scandal July 13, 2005 [ LINK ]

Peer Review Comments: If they can access them, it is not timely or costly.