| Serbia : Integrity Scorecard Report > Sub-Category: State-Owned Enterprises | ||
| Indicators | Score | |
| 67 | In law, is there an agency, series of agencies, or equivalent mechanism overseeing state-owned companies? | 100 |
| 68 | Is the agency, series of agencies, or equivalent mechanism overseeing state-owned companies effective? | 45 |
| 69 | Can citizens access the financial records of state-owned companies? | 55 |
Indicator and sub-Indicator Details
| 67 | In law, is there an agency, series of agencies, or equivalent mechanism overseeing state-owned companies? | |||||||
| 67: In law, is there an agency, series of agencies, or equivalent mechanism overseeing state-owned companies? | ||||||||
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Comments: Government in general and the line ministries are in charge of overseeing the state-owned companies. References: Law on Public Enterprises and Activities of General Interest ("Official Gazette RS" n° 25/2000, 25/2002, 107/2005).
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| 68 | Is the agency, series of agencies, or equivalent mechanism overseeing state-owned companies effective? | |||||||
| 68a: In law, the agency, series of agencies, or equivalent mechanism overseeing state-owned companies is protected from political interference. | ||||||||
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Comments: In practice, the mechanism of "oversight" of public companies consists to nominate directly, by the government (executive), all members of the managing bodies of state-owned enterprises. The managing bodies are the board of directors, director, and supervising board. The practice of governing political parties is to include in the coalition agreement the repartition of the control over state-owned enterprises. The change of the government is followed by the change of the composition of all three managing bodies in the state-owned enterprises. This practice is in harmony with the mentioned Law on Public Enterprises and Activities of General Interest, inherited from the Milosevic era. References: Law on Public Enterprises and Activities of General Interest ("Official Gazette RS" n° 25/2000, 25/2002, 107/2005). Dogovor o javnim preduzecima [Agreement on public enterprises], B92, Oct. 6, 2007. [ LINK ]
Peer Review Comments: Making appointments for the management of state-owned enterprises is a political trophy or reward for political parties.
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| 68b: In practice, the agency, series of agencies, or equivalent mechanism overseeing state-owned companies has a professional, full-time staff. | ||||||||
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Comments: In practice, the mechanism of oversight and control of public companies consists to nominate directly, by the government (executive), all members of the managing bodies of state-owned enterprises. The managing bodies are the board of directors, director, and supervising board. The practice of governing political parties is to include in the coalition agreement, the repartition of the control over state-owned enterprises. The change of the government is followed by the change of the composition of all three managing bodies in the state-owned enterprises. References: Ljiljana Petrovic, Director of the Citizen Action Center Integras , Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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| 68c: In practice, the agency, series of agencies, or equivalent mechanism overseeing state-owned companies receives regular funding. | ||||||||
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Comments: References: Ljiljana Petrovic, Director of the Citizen Action Center Integras , Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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| 68d: In practice, when necessary, the agency, series of agencies, or equivalent mechanism overseeing state-owned companies independently initiates investigations. | ||||||||
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Comments: Absence of systematic investigation over financial irregularities. References: Baraceva: Javna preduzeca kao feudi [Barac: Public Enterprises as fiefs, B92, Oct. 20, 2008. [ LINK ] Prva kontrola u JP Aerodrom Nikola Tesla [First control in the Public enterprise Airport Nikola Tesla], Economy.rs [ LINK ] Transparency Serbia, Skandali u javnim preduzecima posledica odsustva sistemske borbe protiv korupcije [Scandals in the public enterprises consequence of the absence of a systemic fight against corruption], Press release in Bilten, November 2008-January 2009.
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| 68e: In practice, when necessary, the agency, series of agencies, or equivalent mechanism overseeing state-owned companies imposes penalties on offenders. | ||||||||
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Comments: Mechanism is partisan. Depoliticization of state-owned enterprises, through their privatization, would be a good solution. References: Milojko Arsic & Dusko Vasiljevic, Restrukturiranje i privatizacija javnih preduzeca u Srbiji [Restructuring and Privatization of Public Enterprises], FREN, Kvartalni monitor br. 9 April-June 2007. Ljiljana Petrovic, Director of the Citizen Action Center "Integras", Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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| 69 | Can citizens access the financial records of state-owned companies? | |||||||
| 69a: In law, citizens can access the financial records of state-owned companies. | ||||||||
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Comments: All enterprises have the obligation to submit their financial reports to the National Bank of Serbia (NBS). Citizen can access these reports by addressing themselves to the NBS. Consolidated financial reports of medium and big enterprises, together with the audit report, should be available to citizens via the websites of these companies or via other media. References: Law on Accounting ("Official Gazette RS" n° 46/2006) Article 33.
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| 69b: In practice, the financial records of state-owned companies are regularly updated. | ||||||||
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Comments: According to the Law on Accounting (Article 32), medium and big enterprises, which are submitting consolidated financial reports, have the obligation to audit their annual accounts and to publish them with the audit report in the press, journals, and on the website. Their financial data should be annually updated. In practice, some enterprises respect their obligations, others do not. References: Law on Accounting ("Official Gazette RS" n° 46/2006). Ljiljana Petrovic, Director of the Citizen Action Center "Integras," Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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| 69c: In practice, the financial records of state-owned companies are audited according to international accounting standards. | ||||||||
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Comments: Some enterprises publish their consolidated financial reports together with the audit report (auditing is done by international standards), while others do not. References: Law on Accounting ("Official Gazette RS" n° 46/2006). Ljiljana Petrovic, Director of the Citizen Action Center "Integras", Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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| 69d: In practice, citizens can access the financial records of state-owned companies within a reasonable time period. | ||||||||
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Comments: All enterprises have to submit their annual accounts to the National Bank of Serbia (NBS). Citizens can access these reports by addressing the NBS. Consolidated financial reports of medium and big enterprises, together with the audit report, should be available to citizens via the websites of these companies, or via other media. The time period necessary to access financial records of companies will depend on the data the citizens are looking for. References: Ljiljana Petrovic, Director of the Citizen Action Center Integras , Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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| 69e: In practice, citizens can access the financial records of state-owned companies at a reasonable cost. | ||||||||
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Comments: The costs to access companies' financial records will depend on the data the citizens are looking for (consolidated, or other). Obtaining data from the NBS is not free. References: Ljiljana Petrovic, Director of the Citizen Action Center Integras , Pozarevac, Serbia (Sept. 10, 2009, Pozarevac).
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