|
|
We, Zayed
Bin Sultan Al Nahyan, President of the After having
perused the provisional constitution, Law No. (1) for
1972, pertaining to the jurisdictions of the ministers and the powers of the
ministers and the laws amending thereof, Law No. (8) for 1973 pertaining to the Civil
Service in the Federal Government, And
in accordance with the Prime minister's proposal, the approval of the Cabinet
and Federal National Council and the Sanction of the Federal Supreme council,Issued the following law |
|
|
|
An independent
authority called the "State Audit Institution" (S.A.I.) shall be
established and attached to the Federal National Council. The S.A.I. shall
audit the funds of the state and other authorities stated in article
(4) herein. The S.A.I. shall particularly ensure the safety and legality
of managing such funds and the implementation of development projects, all as
provided for in this law and its internal regulation. The State Capital shall
be the headquarter of the S.A.I. Branches for the S.A.I.can be established in the S.A.I. president. |
|
|
|
Article (2) |
|
|
|
The S.A.I. shall be formed of the S.A.I. President assisted by the Vice president
and a sufficient number of professional, administrative officials and
employees. The Internal Regulation shall specify the rules of the S.A.I.
Personnel, especially the rules and conditions of their appointment,
promotion, transfer, delegation, secondment, fixing
their salaries and remuneration's and the provisions relating to their
disciplinary procedures without the adherence (reference) to the provisions
stipulated in the law and regulations of the Civil Service. The number of
posts shall be annually fixed in the S.A.I. budget. |
|
|
|
Article (3) |
|
|
|
The S.A.I. shall be
composed of a number of departments and audit sections. The Internal
Regulation shall fix the manner of organization, competence's
and method of work performance therein. |
|
|
|
CHAPTER TWO POWERS OF THE S.A.I. |
|
|
|
The S.A.I.
shall practise audit over the following bodies:- |
|
|
|
1- |
The
ministries and departments of the Federal Government. |
|
|
|
2- |
The Federal
National Council. |
|
|
|
3- |
The public corporations
and bodies. |
|
|
|
4- |
The companies
or bodies, in which capital the State or any public artificial person may
have a share not less than 25% or for which the State guarantees a minimum
limit of profit or offers a financial subsidy. |
|
|
|
5- |
Any other
body of which audit is charged to the S.A.I.
By the Federal Supreme Council (F.S.C.), the President of the State or
the Cabinet. |
|
|
|
Upon a
written request from the ruler of any Emirate, the S.A.I. may practise audit over the government departments of such
Emirate, as well as the finance of corporations and bodies attached to it and
all companies in which capital the Emirate may have a share not less than
25%, or those for which the Emirate government guarantees a minimum limit of
profit, offers financial subsidy. |
|
|
|
|
Article (5) |
|
|
|
The S.A.I. shall exercise prior (preventive) audit
and post-audit on the funds referred to in article (1),
according to the provisions stipulated in this law |
|
|
|
|
|
|
|
Shall be
subject to the S.A.I. prior
(Preventive) audit, every draft agreement or contract relating to public
works, supply, lease and other contracts or agreements which establish rights
for the State or for other public artificial persons or which include
obligations or commitments incumbent on them, should the amount of each
agreement or contract reach 500.000 dirhams or
more, whatever the method of choosing the contractor has been. It is not
allowed, whatsoever, to divide any contract or agreement in order to decrease
its value to an amount which is excluded from the prior (Preventive) audit of
S.A.I. |
|
|
|
|
|
|
|
The S.A.I.shall
perform audit on the draft agreement or contract, referred to in article
(6) , and inform the concerned authority of the result within seven days,
as a maximum period, from the date of receiving the papers and documents of
the agreement or contract and the relating documents. The effective
date of the period referred to in the preceding paragraph will be the date of
receiving the documents and inquiries required by the S.A.I. The S.A.I.
audit shall extend to ensure that the appropriations allocated in the
budget permit contracting, that all procedures required before contracting
have been implemented according to the rules stated in laws and regulations
and that the draft agreement or contract, with its included conditions and
provisions, conforms with the financial laws and ensures the financial
interest of the State or public artificial persons. |
|
|
|
Article (8) |
|
|
|
If the S.A.I. has not notified the concerned authority
of its decisions regarding the draft of contract or agreement within the
period referred to in the previous article, the concerned
authority shall have the right to conclude the contract without prejudice to
the S.A.I.`s powers in practicing the post-audit
and verifying the contract or agreement after its conclusion. |
|
|
|
Article (9) |
|
|
|
If the S.A.I. objected to the
draft contract or agreement and if the concerned authority did not find it suitable
to take its objection into account, when such authority must inform the S.A.I. about its point of view supported with
evidences which it relies upon. If the S.A.I. President insists on the S.A.I. opinion, the matter should be referred to the concerned
minister or the official who exercises the minister's powers in that
authority. If the minister's opinion is different from that of the S.A.I.`s President, the first shall refer both
points of view to the Council of Ministers (Cabinet) who will decide in the
matter, finally, after hearing the S.A.I. President's point of view. The
Cabinet's decision shall be adopted. However, in case the Cabinet's decision
is contradicting that of the S.A.I. president's point of view, the latter has to submit a
detailed report on the case to Federal National Council (FNC) within a week
from the date of issuing the Cabinet's decision accepting the contract or
agreement. The report
shall be forward to the F.N.C. to be considered in the first session
following its receipt. |
|
|
|
Article (10) |
|
|
|
|
In the field
of Post- audit, the S.A.I.shall exercise the following powers : |
|
|
|
|
1- |
To ensure
that the administrative authorities have collected the revenues accrued for the
State and added them to the related accounts. For this purpose the S.A.I. shall scrutinize
the documents, sheets, and accounts to ensure the sound calculations of such
dues, that the collected amounts are the legally accrued and that the
financial operations relating to the collection of these accrued amounts and
to their entry, have been accomplished regularly and according to the
financial and accounting laws, regulations and rules. |
|
|
|
2- |
To ensure
that the expenditures have been adequately disbursed within the limits of
appropriations allocated in the budget and in accordance with the objectives
for which such appropriations had been allocated, and that the expending
operation, in all stages, has been accomplished according to the accounting
and financial laws, regulations and rules of the budget. For this purpose the
S.A.I. shall ensure that appropriations have
been used without extravagance, according to the rules of the Internal
Regulation and that the financial disposals have been executed according to
the accounting and financial laws and regulations, in addition to the rules
of the budget. |
|
|
|
3- |
To audit the
reconciliation accounts; such as trusts, advances and current accounts, in order
to ensure soundness of their operations, that their numbers have been entered
in the accounts and that they are supported with legal documents. |
|
|
|
4- |
To audit the
loans concluded by the public artificial persons in order to ascertain: |
|
|
|
The soundness
of the financial conditions provided in the loan contract, and, |
(a) |
|
|
|
|
That the
original loan plus its interests have been repaid according to the rules
adopted in this respect. |
(b) |
|
|
|
|
But as for the
loans concluded by the State, the S.A.I. audit of them shall be limited to
the rules to what fell under clause (b) above. |
|
|
|
|
To audit the
investment of the State's funds and of other public artificial persons to
ensure the extent of soundness and security of the fields where such funds
have been invested as well as the expediency of the return of the investment. |
5- |
|
|
|
To audit the
accounts of warehouses and stores and their entries, reviewing their books,
registers and relating documents, as well as ensuring the soundness of annual
inventory operations and studying the reasons resulting accumulation or
damage of stored materials, and to propose appropriate means for safe-
keeping and maintaining such materials and necessary rules for sound planning
to supply the warehouses and stores. |
6- |
|
|
|
To control of the
implementation of development projects as stated in the Plan to ensure of the
sound utilization of appropriations allocated in the budget for such projects,
and that the said projects are implemented within the adopted costs and time
limits, and has realized the targets of the plan, as well as explaining the
reasons of deviation and deficiency. |
7- |
|
|
|
Examining the
final and appropriation accounts of all authorities audited by the S.A.I., as
well as balance sheets, profit and loss accounts, operating and trading
accounts of the corporations and companies of the economic sector subject to
the S.A.I. audit, and their documents. To identify the exact financial
position of the authorities corporations and companies and to determine that
their returns are sound and expedient and to limit the rights and obligations
of the State and the public artificial persons vis-a-vis
these companies. The S.A.I. shall also examine the reports presented by
external auditors to the general assemblies. |
8- |
|
|
|
Making the
inventory of money, stamps and papers of value to ensure their conformity
with entries. |
9- |
|
|
|
Article (11) |
|
|
|
Within the
limits of its powers stipulated in this law, the S.A.I. shall undertake the
following: - |
|
|
|
To detect
incidents of defalcation, negligence and financial contravention's, investigate
therein, quest for their motives thereof, study the aspects of deficiency in
legislation and the system of internal control which led to their occurrence
and propose the means of remedy. |
1- |
|
|
|
To study and scrutinize
various financial and accounting laws, rules and regulations as well as the
method of conducting financial operations in order to ensure the extent of
their soundness, determine the aspects of deficiency and imperfectness
therein and propose the means it deems necessary to reform and improve them
in order to make the funds management, subject to audit, reach the optimal
standard of soundness, efficiency and accuracy. |
2- |
|
|
|
Article (12) |
|
|
|
The S.A.I.
President shall prepare an annual report for each of the final accounts of
the bodies subject to the S.A.I. audit, in which the observations and aspects
of difference occurring between the S.A.I. and the body concerned,
shall be elaborated. The report
shall be submitted to the Federal National Council before the date appointed
for approving the final account relating to that report which shall be
notified. In the meanwhile, to the Federal Supreme Council, the State's
President and the Council of Ministers (Cabinet). If the report is pertaining
to a corporation or a company it shall be notified, to the Corporation's
Board of Directors and to the Company's General Assembly 30 days before
convening them to approve the balance sheet and final accounts. All these
council and boards can invite the S.A.I. President or the S.A.I.
Vice-president to attend their meetings in which the S.A.I.'s
reports shall be debated. He can address the meeting and states his opinion
in the debated matters. The S.A.I. President may
also submit other reports, within the fiscal year, about matters which he
deems to be of great importance requiring urgent perusal of concerned
authorities. |
|
|
|
CHAPTER THREE EXERCISE OF POWERS AND AUDIT SANCTIONS Article (13) |
|
|
|
The S.A.I. shall
practise its powers as provided in this Law by both
methods of auditing and inspection. S.A.I. can perform inspection on the
bodies subject to its audit spontaneously or at the request of the authority
concerned. The audit
practiced by the S.A.I. shall be complete or selective and according to the
rules determined by the work plan drawn up by the S.A.I. and which shall not
be available to the acquaintance of the bodies subject to audit. |
|
|
|
Article (14) |
|
|
|
The S.A.I. is
entitled to scrutinize and document, record or papers which the S.A.I. deems
necessary for its proper performance of audit. |
|
|
|
Article (15) |
|
|
|
The auditing
operations shall be undertaken at the S.A.I. premises or at the premises of
the body where the accounts, records and the supporting documents are found. |
|
|
|
Article (16) |
|
|
|
All the
officials and employees in the bodies subject to the S.A.I. audit shall be financially
responsible for their disposals relating to the funds, under audit, according
to the rules stipulated in this Law and the Internal Regulation and shall
therefore be subject to inspection and audit by the S.A.I. But as for the
ministers it is sufficient for the S.A.I. to prepare a report regarding the
acts and procedures attributed to them. S.A.I. President shall submit the
report to the Federal National Council and notified it to the Federal Supreme
Council, the State's President, and the Council of Ministers (Cabinet). |
|
|
|
Article (17) |
|
|
|
The S.A.I.
shall draw up the results of its auditing and inspection in the form of
observations to be reported to the concerned authorities through the relevant
ministers. Those authorities shall provide the S.A.I. with their replies on
those observations, carry out the S.A.I. demands and take the necessary
measures for collecting the lost monies or those which were spent illegally
or receivables, the collections of which has been neglected. And such action
to take place, within one month from date of notification. |
|
|
|
Article (18) |
|
|
|
It shall be sufficient for
a competent Minister to submit a signed statement every 3 months to stand as
evidence for the special confidential expenditures allocated in the budget
for his Ministry, as well as a certificate stating that such expenditures,
have been disbursed within the authorized appropriations limits and directed
to the objectives allocated thereof. |
|
|
|
Article (19) |
|
|
|
The following
shall be considered as a financial contravention, in the application of this
Law: - |
|
|
|
Violation of
financial rules and provisions as stipulated in the Constitution, laws, rules
and regulations. |
1- |
|
|
|
Violation of
the State General Budget provisions as well as those budgets of bodies
subject to the S.A.I. audit. |
2- |
|
|
|
Every
disposal, negligence or deficiency resulting in illegal disbursement of monies
from the funds subject to S.A.I. audit, or loss of financial rights of the
state or any other bodies subject to the S.A.I. audit or prejudicing any of
their financial interests or inflicting damage to one of their financial
interests or to the funds under audit or delay of the implementation of
development projects. |
3- |
|
|
|
Defalcation
of funds under audit or mistrust thereon. |
4- |
|
|
|
Commitment
with unnecessary expenditures not required by the public interest. |
5- |
|
|
|
Not to provide
the S.A.I. with the accounts and their supporting documents or other, for
audit purposes. |
6- |
|
|
|
Not
responding against the S.A.I. observations or correspondence, in general, or delay
for reply without genuine reasons. The employee's reply aimed at
procrastination and postponement shall be considered as a non-reply. |
7- |
|
|
|
Delay, with
no reasons, to inform the S.A.I. during a maximum 15 days with what have been
taken by the concerned department, to adopt penalties against the financial
contravention that endorsed by the S.A.I. or to slow down without sufficient
justifications. |
8- |
|
|
|
Generally any
disposal or negligence that leads the S.A.I. not to exercise its powers properly. |
|
|
|
Article (20) |