Paraguay : Country Financial Accountability Assessment

Paraguay : Country Financial Accountability Assessment

The issues addressed in this Country Financial Accountability Assessment (CFAA), lie at the very core of the Government of Paraguay's performance, and its fight against corruption. The outputs of the CFAA assess the Government's public fi...

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Bibliographic Details
Main Author:	World Bank
Format:	Country Financial Accountability Assessment
Language:	English en_US
Published:	Washington, DC 2013
Subjects:	ACCOUNTANTS ACCOUNTING ACCOUNTING STANDARDS ACCRUALS ADJUSTMENT LENDING ANTICORRUPTION AUDITING AUDITORS AUDITS BANK LENDING BANK LOANS BANK OPERATIONS BANKING SECTOR BANKING SYSTEM BANKS BORROWING BUDGET EXECUTION BUDGET PERFORMANCE BUDGETING CAPITAL MARKETS CITIZEN PARTICIPATION COLLECTION AGENCIES COMMUNITY DEVELOPMENT CONSOLIDATED FINANCIAL STATEMENTS CONTRACTUAL OBLIGATIONS CORRUPTION COUNTERPART COUNTERPART FUNDS DEBT DEBT SERVICE DEFICITS ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ELECTRICITY EXPENDITURES EXTERNAL FINANCING FINANCIAL ACCOUNTABILITY FINANCIAL ADMINISTRATION FINANCIAL AUTHORITIES FINANCIAL MANAGEMENT FINANCIAL MANAGEMENT SYSTEMS FINANCIAL REPORTING FINANCIAL SECTOR FINANCIAL SECTOR ADJUSTMENT FINANCIAL STATISTICS GOVERNMENT BUSINESS ENTERPRISES GOVERNMENT REFORM HUMAN CAPITAL INCOME INTEGRITY INTERGOVERNMENTAL TRANSFERS INTERNAL CONTROLS INTERNATIONAL ACCOUNTING STANDARDS INTERNATIONAL AUDITING STANDARDS LAWS LEGAL FRAMEWORK LEGISLATION LIABILITY LOCAL CURRENCY MANAGEMENT MANAGEMENT CONTROLS MANAGERS MISMANAGEMENT MUNICIPALITIES OPERATIONS ORGANIZATIONAL STRUCTURE PENSIONS POLITICAL PARTIES PROVISIONS PUBLIC EMPLOYMENT PUBLIC EXPENDITURE PUBLIC FUNDS PUBLIC INVESTMENT PUBLIC PROCUREMENT PUBLIC RESOURCES PUBLIC SECTOR PUBLIC SECTOR EMPLOYMENT PUBLIC SECTOR MANAGEMENT PUBLIC SERVANTS PUBLIC SERVICE PUBLIC WORKS RATIONALIZATION REFORMS RESOURCE MANAGEMENT RESOURCE USE REVENUE COLLECTION RURAL WATER SERVICE CALLS SOCIAL SERVICES SUPERVISION TAX TAX ADMINISTRATION TAX REFORM TAX REVENUE TEAMS TECHNICAL ASSISTANCE TRANSPARENCY TREASURY UTILITIES
Online Access:	http://documents.worldbank.org/curated/en/2004/08/5663137/paraguay-country-financial-accountability-assessment http://hdl.handle.net/10986/14491

Description
Summary:	The issues addressed in this Country Financial Accountability Assessment (CFAA), lie at the very core of the Government of Paraguay's performance, and its fight against corruption. The outputs of the CFAA assess the Government's public financial management systems, practices and accountability arrangements, and address key issues in the sustainability of economic growth. The outputs of this report are also of particular importance at this time, given the need to ensure that quick disbursement funding, linked to adjustment lending operations by the two participating Banks, will be subject to adequate financial management arrangements. The strategic approach to improving public financial management in Paraguay, embodied in the Action Plan emerging from this CFAA, requires immediate action on two fronts. The first is to move towards establishing an adequate control environment; the second strategic priority is a stronger control function, both internal and external. This CFAA presents the standards, regulations, and practices recommended to implement an effective system of internal control, and, the changes recommended to give the Auditor General more impact in its work. The report looks at the weaknesses and shortcomings that continue to threaten financial accountability in Paraguay, i.e., legal framework, budget execution, accounting standards, decentralized entities, and, internal control, among others. The CFAA concludes that Paraguay's financial accountability arrangements are failing to support public expenditure outcomes, and that transparency in the use of public funds is needed to encourage faith in the conduct of the government. Currently, the financial management risk is assessed as high. To achieve an acceptable level of risk, reforms are recommended in the areas of internal control, external audit, and the control of decentralized entities. Urgent attention must be given to the areas of the independent control function, control over the financial position, and to governance of the decentralized entities. Most serious are the numerous exceptions in the application of the Financial Administration Law, and the need for the financial management legal framework to be supported by broader laws on civil service, ethics, anti-corruption and transparency. The approach to control should be rethought to better support operational efficiency, taking advantage of the advances in information systems, legal framework, and the staff who should be selected under a merit-based civil service. Finally, regarding the control function, Paraguay has recently removed the overlap between the Auditor General and the Court of Accounts; the Auditor General should also be given greater control over the selection of work it performs.