A new section on how to prepare for an audit has been added to the VTV.fi website. It provides organisations with information on how they can prepare for the audits conducted by the NAOF.

We thank public officers, members of Parliament and other cooperators as well as all those interested in public finances and governance for the year 2018. Season’s greetings and happy New Year 2019!

With the assistance of the Turkish Court of Accounts, the National Audit Office arranged a EUROSAI Emerging Issues Workshop in Istanbul in November. The NAOF is a member of the EUROSAI Governing Board and responsible for the portfolio Emerging Issues and Forward Thinking. Topical issues, foresight and the manner in which Supreme Audit Institutions can meet future needs were discussed in the workshop.

NAOF assesses that the Government is now better placed to achieve the targets that it has set for the parliamentary term. According to economic forecasts, most of the targets for general government finances set by the Government may now be achieved as the Finnish economy is picking up after a long period of slow growth.

According to a recent NAOF survey, the economic forecasts prepared by the Ministry of Finance, which are used as a basis for the state budget, give the most accurate picture of future economic trends. Their accuracy was on a par with those produced by the Research Institute of the Finnish Economy (Etla). The review was contained in the latest assessment carried out by Fiscal Policy Evaluation, which covered the Ministry of Finance's economic forecasts.

The National Audit Office of Finland (NAOF) has examined how business executives view Finland as an investment environment. The purpose was to find out why Finnish economic growth remains slow even though the country ranks high in international competitiveness comparisons. The business executives, experts and government officials interviewed by NAOF listed a number of proposals for improving the investment environment. They included streamlining of permit processes and public contracts, better education and training paths, and a higher status for marketing.

Makera received EUR 90 million of additional funding as part of the key Government project on bioeconomy. The impact of the additional funding on the implementation of the Bioeconomy Strategy cannot be separately assessed, however, as the additional funding was merged with other forms of agricultural investment aids. The agricultural administration should assess financial profitability of the different investment aid types on central government finances. It should also assess how well the supported investments reach their effectiveness goals.

The plans made by central government agencies to ensure the continuity of their operations are not at adequate level. Many of the agencies have not prepared any plans. The agencies’ senior management must take responsibility for ensuring the continuity of operations in disruptions occurring in normal conditions. Centralisation of central government-internal services and new networked operating models require that continuity risks should be managed more extensively than at agency level. The need for management at higher levels should be examined and the work should be coordinated by the Government Financial Controller’s Function.

Even though the impact assessments of tax law reforms provide a good information base for decision-making, the combined impacts of tax law reforms should also be examined in them. At the same time, there is little information available on the costs and impacts of tax expenditures even though they have a significant effect on general government finances. Decision-makers need more information so that they can better assess the usefulness of individual tax expenditures.

Central government finances are often compared to the finances of an enterprise or a household. When there is a warning on indebtedness, the Government is advised to do what a family would do: to use as little money as possible. There are plenty of interesting differences between the finances of a state and a private enterprise, however. The differences become clear when you study the operations and the operating logic from the outside.

The Finnish Bioeconomy Strategy (“Sustainable growth from bioeconomy”) was drafted between 2012 and 2014 in a project launched by the Ministry of Economic Affairs and Employment. Last September, we assessed the preparation of the strategy. As the auditors, we were impressed by the extensive, successful cooperation between administration, stakeholders and citizens during the preparation process.

There has been a great deal of debate about tax expenditures as a form of public subsidy in recent years. In practice, tax expenditures mean tax exemptions, tax deductions, lower tax rates and other similar instruments aimed at supporting specific business categories or taxpayer groups.