Auditing operation No. 03/24
State Budget funds for the support of small and medium-sized businesses
The auditing operation was included in the Annual Audit Plan of the Supreme Audit Office (hereinafter referred to as „SAO“) for the year 2003 under No. 03/24. The auditing operation was managed and audit conclusion drawn up by Mr. Zdeněk Brandt, the Member of the SAO.
The aim of the audit was to examine the authorizations of payments, drawing and use of State Budget funds for the support of small and medium-sized businesses and to carry out an evaluation of the expected benefits.
The audited period covered the years 2001 to 2003 (as well as previous periods in case of relevant connections. For the evaluation of the fulfilment of the targets and the evaluation of the expected benefits the period from the year 1998).
The audited bodies were Ministry of Industry and Trade (hereinafter referred to as „MIT“), Českomoravská záruční a rozvojová banka, a. s., (the Czech-Moravian Guarantee and Development Bank, a. s., hereinafter referred to as ČMZRB) and selected auditees.
In comparison with the status ascertained in the previous auditing operation No. 98/32 „The support of small and medium-sized businesses provided through Českomoravská záruční a rozvojová banka, a. s. (ČMZRB)“ there has been a certain improvement in the creation and approval of the individual programmes, in the accuracy of their contents, the negotiations between the MIT and ČMZRB and the contracts with support beneficiaries. The effectiveness of controls carried out by the MIT and ČMZRB increased, including the enforcement of debts and penalty recourse at the support beneficiaries.
The MIT did not specify a target level that small and medium-sized businesses should reach, expressed in relative or absolute terms. When specifying the level of support in the budget proposals the MIT used its evaluations of previous years and the total of the submitted requests.
The MIT has been monitoring the efficiency in decisive parts of the programmes since 2001, though it has not yet specified criteria for its evaluation. Thus a more objective basis for judging the validity of the programmes (especially of an advisory character) in the system of small and medium-sized businesses or for proposals of changes to the individual programmes, which would ensure the fulfilment of the specified goals with the economically acceptable efficiency of the programmes, is lacking.
About 12.4 milliard CZK was released from public sources for the support of small and medium-sized businesses in the years from 1998 to 2003. According to the MIT evaluations the share of small and medium-sized businesses in the macroeconomic indicators of the Czech economy in the aforementioned years varied and saw practically no growth, even though the annual source of support more than doubled compared with 1998. The real value of the monitored indicators of small and medium-sized businesses posted by the MIT had showed a growing trend, however.
There were accomplished decisive priorities of the small and medium-sized businesses support programmes specified in the support policy for the audited programmes. The programmes contained the requisites specified by the regulations and other documents, just like the contractual stipulations between the MIT, ČMRZB and the support beneficiaries. The decisions on the use of support for the individual programmes were primarily made by the ČMZRB. The selection of the projects for support, carried out by ČMZRB, was transparent.
During the course of the audited period the financing of small and medium-sized businesses became less dependent on the funds of the State Budget. The share of „self-financing“ and foreign aid has more than doubled since 1998 and about half of the provided support is currently financed from these sources.