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sanctioning powers (Sciolla Avendaño 2002; Aylwin Azócar 2002, 1995). However, the presence of ex-ante control tends to render make sanctioning powers redundant. The CGR makes recommendations to senior managers who would decide on the corrective actions required. When administrative impropriety is suspected, the CGR’s tribunal of accounts (TC) initiates a judgment of accounts to determine civil servants’ administrative responsibility. However, the TC rulings are only partly self-enforcing, as in the case of salary retentions or other administrative sanctions, and can be challenged in the courts. Coercive enforcement is pursued in ordinary courts by the public prosecutor’s office in the CGR.

The CGR also performs administrative functions that conflict with its role as auditor of government accounts (World Bank 2004; OECD 2004; IMF 2003). In particular, it supervises the state accounting system. As a result, it does not audit government financial statements in accordance to international audit standards, simply because it prepares them. It nevertheless prepares monthly, quarterly and yearly accounting reports on the state of public finances and presents an annual report on budget execution to the President and the legislature. The CGR also prepares two other annual reports, the Cuenta pública del Controlador and the Memoria annual, which provide an annual account of the CGR’s activities and a review of government finances, including the follow-up given to previous audit recommendations. Both reports have limited impact on political debates.

Institutional trajectory

Recent corruption scandals have shaken the country’s confidence in its fiscal control institutions. In 2002, scandals erupted in the procurement practices in public works, as well as questionable gratifications of high-ranking officials financed from the government’s discretionary ‘reserved funds’ (‘gastos reservados’). For Orrellana Vargas (2003), these scandals revealed ‘complacency with limited corruption’ and flaws in internal and external control systems. The CGR was particularly exposed to public criticism, as it is tasked with controlling, ex-ante, the regularity of public procurement and public sector remunerations. According to Orrellana Vargas (ibid), it appeared ‘totally surprised by actions that it is supposed to oversee.’

Many of the dysfunctions of external auditing in Chile today have their origins in history. The CGR performs tasks that, in other countries, are carried out by three or more organizations, including the quasi-administrative functions of a general accounting office and the quasi-judicial functions of a tribunal of accounts (Llanos González and García Yerkovis 2002). This is partly the result of the CGR’s origins. The CGR combined the functions of the four state agencies that were merged in 1927 in an effort to rationalize government financial management. These included the comptroller-general’s office, the tribunal of accounts, the bureau of statistics and the inspectorate-general of national assets (Llanos Campos 2003).

Both internal and external factors have shaped the configuration of the CGR’s powers, the scope of its authority and its approach to fiscal control. In 1925, US financial advisor Edwin Kemmerer who, in 1925, made a series of recommendations to strengthen financial administration and fiscal control based on the experience of the US, following the establishment of the US Government Accountability Office in 1921. Nevertheless, the features and functions of the CGR were also shaped by domestic political considerations and the country’s legal traditions. Its creation participated in the modernization of the budgetary system and the re-equilibration of budgetary powers between the executive and the legislature in the 1920s (Animat et al. 2006; Marcel and Tokeman 2002; Vial 2001; Santiso 2006c, 2006d, 2005a, 2005b, 2004d). A committee presided by a prominent Chilean lawyer, Julio Philipppi, amended the Kemmerer’s proposals in significant ways, reintroducing, for example, ex-ante control functions. More fundamentally, the CGR’s


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