The SAO’s audit found that audited enterprises had established control systems to support the process of approving annual accounts, deficiencies however were observed during the practical application.
The objective of the audit was to assess whether (majority) state-owned enterprises had established and operated controls over the adoption of the 2022 annual accounts and whether controls in place contributed to the adoption of the 2022 annual accounts in accordance with the regulations.
The purpose of the annual accounts is to give a true and fair view of the assets, financial position and income situation of an enterprise. It provides information not only to external market players, members of the management and partners, but also to owners and citizens. Consequently, controls established in relation to the annual report on the company’s operations, assets, financial position and income situation are of paramount importance.
Considering the six (non-profit) enterprises selected for the intended audit, establishment and operation of controls supporting the adoption of accounts were completed in all cases. However, the audit identified deficiencies with regards to the practical implementation in two cases. In the case of other two companies, the audit found weaknesses with regards to the publication of the accounts on the website.
The SAO considered it to be a good practice that many of the audited enterprises had controls in place to examine the accounts which they would not have been required to implement under the legislation. Nevertheless, the audit revealed that in some cases the controls were not being implemented in practice, hence were not fulfilling their real purpose.
Full text report is available in Hungarian here.