Musa KAYRAK Senior Auditor, CISA November, Moscow

 Established by virtue of the Constitution and enjoys a permanent legal status  Mentioned the first Constitution(1876 ) of the Ottoman Empire (Chamber of Accounts)  Maintained its status in 1924, 1961 and 1982 Constitutions of the Turkish Republic.  The Law on the TCA

 The 'court' with a judicial function

 A fixed term under the Constitution or law ◦ The fix term of office of the President of Turkish Court of Accounts shall be five years. May be elected twice at most. ◦ Members are elected until retirement.

 Independent of the legistlative, executive and judicial branches

 Enjoys financial independence without any intervention of the Ministry of Finance ◦ Within the scope of the general budget ◦ Preparing its own budget independently ◦ Does not have to follow the general budgeting procedures as it is the case for other public administrations under the general budget. ◦ According to the article 62 of the Law on the TCA, the Presidency of TCA shall submit its budget directly to the Turkish Grand National Assembly (TGNA) and forward one copy to the Ministry of Finance.  The Turkish Grand National Assembly has the final say on the budget of the TCA. ◦ However, in practice, the TCA does not face any budgetary limitation imposed by the TGNA.

 Central or national government agencies, bureaus, offices, instrumentalities and local government units at all levels  In addition to this, the TCA has the power to audit:  All types of administrations, organizations, institutions, associations, enterprises and companies affiliated to, or founded by public administrations provided that the public share is no less than 50%;  Domestic and foreign resources and funds, including European Union funds;  All public accounts, including private accounts, funds, resources and activities regardless of whether these are in the public administrations budget;  Accounts and transactions of international institutions and organizations within the framework of the principles set out in the relevant treaty or agreement

 Performance Audit  Regularity Audit 1.Compliance Audit 2.Financial Audit  Environmental Audit  Value for Money Audit  IT Audit  Others: Trial of accounts as a result of regularity audits

 Yes but mostly indirectly linked with anti- corruption except for the followings: ◦ The article 78 of the Law on the TCA specifies detailed steps to be taken by the auditors and the Court in the event of encountering an action involving corruption in the course of audits and examinations. ◦ The Regulation on TCA Audit involves detailed articles concerning the cases of corruption such as evidences and documents to be collected, examination methods, format for written communication with the Presidency of the TCA, responsibilities of the Chambers etc.

 A draft version of the anti-corruption strategy of the TCA is ready to be approved. ◦ “The Anti-corruption Strategy of the Court” at the end of 2012 and currently an expert team works on the 1st draft of the strategy and its action plan. ◦ By the end of 2013, the strategy will be officially accepted and begin to be implemented in line with its action plan.

 “The National Anti-corruption Strategy” which specifies four separate tasks for the TCA.  “The Strategic Plan of the Court ( )” mentions the fight against corruption in Turkey as a crucial task for the TCA in accordance with the NACS.  Main action: Prepare “the Anti-corruption Strategy of the Court”  “The Strategic Plan of the Court ( )” involves some other action indirectly related to the anti-corruption efforts of the Court.

 Detecting corruption already embedded in the regular audit services but merely incidental to the audit services being rendered and not an audit focus.

 No specific unit  All departments, offices or units conducting audit are mandated to prevent and detect corrupt activities and transactions

 The compulsory two year-long vocational training for assistant auditors  In-house trainings on a variety of subjects which contribute to knowledge on anticorruption help auditors enhance their skills to combat corruption.  Yet, no specialized group of auditors like certified fraud examiners.

 No.  But two year vocational training for assistant auditors consists of courses on several subjects such as Procurement Law, Accounting, Personnel Law, Social Security System and hands-on training helping auditors detect suspicious cases of corruption.

 No

 Proactive and reactive

 If auditors encounter with a case of corruption steps to be taken are as follows: 1.The evidence shall immediately be identified and the case shall be reported to the Presidency of Turkish Court of Accounts by the auditor. 2.The Chamber assigned by the Presidency of Turkish Court of Accounts evaluates the sufficiency of the initial evidences for public prosecution. 3.If the collected initial evidence is qualified as subject of public prosecution, the file shall be sent to the Chief Prosecutor of Turkish Court of Accounts either to be handed over to the responsible official’s public administration for the necessary action to be taken, or to be sent directly to the Public Prosecution Office for an investigation in accordance with the nature of the offence.

◦ Anti-corruption researches ◦ Promulgation of accounting and auditing rules and regulations ◦ Declaration of assets and liabilities of public officials ◦ Governing Code of Ethics for Government Accountants and Auditors ◦ Public Information Office with linkages to all sorts of media ◦ Updated publication of audit reports through the SAI’s website

◦ Conflict of Interest ◦ Fraud ◦ Illegal gratuities ◦ Asset misappropriation ◦ Embezzlement ◦ Forgery ◦ All types of Illegal activities in public procurement procedures ◦ Online frauds or frauds using the computers

1. Compliance audit 2. Financial audit 3. Performance audit 4. IT audit

1. Cross control of data obtained especially from different sources (ACL, MS Access, SQL, SAYDAP, MS Excel) 2. Physical observation/site visit 3. Risk analysis 4. Analysis of complaints and referrals received

 The Turkish Court of Accounts has uncovered tens of suspicious cases of corruption in the area of public constructions such as public buildings, roads etc. and sent them to the Office of Public Prosecutor for necessary judicial actions.  Those cases are mostly related with the crime of fraud during the fulfillment of contractual obligations and auditors have revealed those cases through physical observations during site visits.  Moreover, in some cases, auditors could ask for the assistance of expert witnesses and experts to get a better view of the situation in accordance with the provisions of the Law on the TCA.

 Our SAI does not issue a special audit report but the corrupt activities and transactions encountered and/or detected will be incorporated in the regular audit report.

 Entity’s management  Legislative body  Furthermore, judicial reports (writs) of the TCA are also delivered to the Ministry of Finance for administrations within the scope of the general budget so that the Ministry can implement the writs in accordance with provisions of the laws in force.

 Criminal prosecution (When cases are sent to the office of public prosecutor for necessary actions to be taken)  Administrative sanctions (When cases are sent to the responsible officials’ public administrations for necessary actions to be taken)

 In financial audits; ◦ audit teams conduct follow-ups of previous years’ audit results so as to ensure the appropriate implementation of audit findings.  In compliance audits; ◦ The judicial reports (writs) of the TCA are also delivered to the Ministry of Finance for administrations within the scope of the general budget so that the Ministry can execute the writs in accordance with provisions of the laws in force. ◦ Furthermore, all audit teams are obliged to control the execution of the writs of the TCA and take it into account in their report if the writs of previous years are not executed. ◦ Finally, the TCA has the power to initiate financial, administrative and judicial sanctions to the public officials who do not follow up the execution and fulfill the requirements of the writs of the TCA. To illustrate, those public officials who do not fulfill the requirements written in the judicial report shall subject to salary cut off by relevant public administrations upon the demand of Turkish Court of Accounts.

1. Preventive actions by providing recommendations to improve entity’s anti- corruption and internal control system and sharing best practices and benchmarking information to assist decision-makers 2. Detective actions through the conduct of fraud/forensic audits [through regularity audits] and timely reporting of the audit results to the Prosecution Department

 ( x ) Good: ◦ The New Law on the TCA which broadened the audit mandate of the Court and introduced regularity audit ◦ The recent changes in the audit methodologies and introduction of data analysis, accounting, internal control systems, risk assessments, use of information systems in the financial workflows. ◦ The TCA has been considered successful in public opinion in preventing and detecting the cases of corruption: Approximately 30 suspicious cases of corruption ◦ New focuses: Improving strategic approach and methodology to better fight with corruption by preparing its anti-corruption strategy, anti-corruption (fraud) manual etc.

 None

 No

 ( x ) Integrity awareness  ( x ) Vulnerability / risk analysis  Compliance approach (rules and regulations, organizational structure, standards, internal controls etc.) Focus on preventing integrity violations/ Repression/Reactive  Integrity approach (culture, integrity awareness, management attitude etc.) - Focus on facilitating good behavior /Prevention/Pro-active

 None

 Some superiors cover up for their subordinates  Other (Please specify) ◦ Due to the nature of supreme audit function the extent of audit evidence gathered by the auditors is not sufficient to discover some cases of corruption. ◦ Lack of a full-fledged cooperation and communication between the TCA and law enforcement agencies

 This question is not applicable to the TCA as we do not perform fraud audits.

 The TCA is considered as the most indispensable actor in the implementation and betterment of the new public financial management and control system of Turkey which is in accordance with international standards and best practices.  The most invaluable contribution of our SAI to good governance is to ensure the accountability and transparency with sound financial management in public sector through their auditing, reporting and judicial functions.  The TCA sends its audit reports to the Turkish Grand National Assembly and publishes them on its website.

 Yes The TCA has eagerly participated several international projects, workshops and trainings organized in the field of anti- corruption by UN, INTOSAI, ASOSAI or other SAIs.  In addition to this, the TCA has contributed to the initiatives for good governance, transparency and accountability organized by GRECO in Turkey.

 ( x ) Yes  Thanks to the “National Anti-corruption Strategy of Turkey” officially approved by the Council of Ministers in 2010 and published in the Official Gazette, the collaboration among all public institutions including the TCA with responsibilities in this field has significantly enhanced in accordance with an action plan.

Musa KAYRAK Senior Auditor, CISA