Ministry of Finance Financial Inspection Board FIB

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Ministry of FinanceFinancial Inspection
Board(FIB)
130 years of experience...
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Introduction

• The Inspection Board of Finance in Turkey is
  well-known and trusted institution in the field
  of investigating, searching and suppressing
  financial sources of the corruption,
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• The Inspection Board of Finance was set up in
  1879, during the attempts to rearrange and
  improve the financial administration in the
  Ottoman Era, with the purpose of ensuring that
  all financial transactions of the state are
  audited and inspected by an authorized board
  under the authority of the Minister of Finance.

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Introduction (Cont.)

• The Inspection Board of Finance which has a
  history of 130 years has not only led and
  determined the institutionalization of financial
  audit and tax review, but has also set a model
  for the inspection boards set up later and has
  acted as a school educating the executives for
  the senior positions in the administration.
• The staff of the Board are hired after detailed
  preliminary investigation and very serious and
  objective processes consisting of preliminary
  eligibility election, written and oral
  examinations and that the hired staff are
  provided with a comprehensive and high quality
  training during 3-year assistant inspector
  positions to foster their skills to take a global
  approach towards events, to give them an
  organizational culture open to innovations and to
  develop their ability to decide independently has
  contributed to this acting as a school.

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Introduction (Cont.)

• Since its establishment, The Board has
  demonstrated and maintained its significant place
  and well-deserved reputation in state
  administration with its 130 years successful
  record.
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• Although the Inspection Board of Finance is
  within the Ministry of Finance from an
  administrative perspective and looks like a
  conventional board of inspectors (internal audit
  unit), it assumes the function of the higher
  audit unit of the state, considering the scope
  and significance of its authority and duties.
  Thus, the Finance Inspectors are employed somehow
  as State Inspectors.

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Mission

• As one of the important components of public
  financial management system, FIB carries out the
  following functions on request and behalf of
  Minister of Finance
• To perform inspection, investigation, examination
  and other auditing duties with respect to
  financial and/or administrative transactions
  within the process of acquisition, administration
  and spending of public resources and to the
  people who perform mentioned transactions.
• To provide assistance to investigation and
  inspection activities executed by legislative and
  judicial bodies.
• To present its knowledge and accumulation
  acquired in this process to the relevant people
  and institutions by taking into account the
  principle of public interest.

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Vision
The vision of FIB is to become a board which is
the most competent on financial and economic
issues which constitutes a bridge and a pioneer
role on transfer of effective and efficient
world-wide practices as well as the modern
theories and technologies on inspection and
investigation techniques to Turkey which
prevents abuse of public resources which
prevents corruptions and also audits all
transactions and units in the fields of economy
and finance.

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Source of Duties and Powers

• Degree Law No178 on Organization and Duties of
  the Ministry of Finance
• Tax Procedure Law (No213)
• Public Financial Management and Control Law
  (No5018)
• The Declaration of Proporties, the Fight with
  Bribe and Malversation on (No3628)
• Prevention Of Laundering Proceeds Of Crime Law
  (No 5549)
• Code on Criminal Procedure Law (No 5271)
• The Law Concerning the Protection of the Value of
  the Turkish Currency (No 1567)
• Degree Law No90 on Concerning Lending
  Transactions
• The Law Of Independent Accountancy, Independent
  Accountant Financial Advisorship And Sworn In
  Financial Advisorship (No3568)
• Associations Law (No5253)
• Foundations Law (No2762)
• Law No4483 (Prosecution of Public Officials and
  Other Public Servants)
• Other Laws and Regulations

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Duties Powers

• Financial Audit
• Tax Audit
• Fighting Against Corruption
• Fighting Against Money Laundering and Financing
  of Terrorism
• Audit of Foreign Exchange Transactions
• Investigation of Civil Servants and Public
  Officers
• Expertise services to judicial authorities
• Functional Inspection
• International Auditing
• Expertise Service to Turkish Grand National
  Assembly in Investigation Committee
• Consultancy Services

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Financial Audit

• a) Audit of Public Expenditures
• Inspecting the central and provincial
  organizations of the Ministry of Finance,
• Financial inspecting the public administrations
  within the scope of general government,
  encompassing public administrations within the
  scope of central government, social security
  institutions, and local administrations and the
  revolving (rotating) funds,.
• Inspecting the agencies minimum half of the
  capital of which is owned by the state regardless
  of their statuses and the agencies in which the
  state holds minimum 50 percent interest,
• Financial audit of the associations and trade
  unions,
• Audit of public expenditures realized by using
  direct public funds.
• b) Audit of Public Assets
• Audit of transactions concerning the acquisition,
  management, disposal of movable and immovable
  public assets.

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Tax Inspection Audit

• a) Administrative, Financial and Functional Audit
  of Tax Administration Units
• Audit of central and decentralized units of Tax
  Aministration as well as the annual programs
  approved by Minister of Finance and annual
  working schedules
• b) Audit of declaration of Taxpayers via Tax
  Examination
• Tax examination performed by finance inspectors
  with the aim of investigating, detecting and
  provision of correctness of the taxes that have
  to be paid by taxpayers in accordance with the
  power delegated by Article 135 of Tax Procedure
  Law.

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Tax Audit

• Functioning according to the criteria , strategy
  and coordination principles of the determined
  plan of Tax Auditing Coordination Commission
• In additionally, the following studies concerning
  tax auditing are conducted by Financial
  Inspection Board.
• Determining inspection and audit areas and
  sectors by macro economic analysis.
• Determining and inspecting problematic areas by
  risk analysis.
• Limited Tax Audit according to the results of
  inspection.
• Cross Tax Audit by using tax intelligence data.
• Executing great scale tax inquires
• Tax inquires on activities with criminal
  dimensions
• Value Added Tax Refund Audit
• Typology studies concerning tax evasion
• Analysis studies concerning tax judiciary
  process.
• Measuring effectiveness of tax audit studies

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Inspection-Investigation of Corruption

• Inspection of organized and globalized
  Corruption, such as
• Fictitious Export
• Corruption of Procurement
• Customs Smuggling
• Corruptions concerning many different public
  departments

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Audit of Money Laundering Financing of Terrorism

• Fighting against Money Laundering and Financial
  Underpinnings of Terrorism by evaluating
  information and intelligence of national and
  international financial movements and economic
  activities.
• Financial Crimes Investigation Board conducts
  the functions of inquiring and investigating
  money laundering offence through Finance
  Inspectors and the other investigators. During
  these investigation cases, Finance Inspectors not
  only use the power of the Law No5549 on
  Prevention of Laundering Proceeds of Crime but
  also powers coming from the other laws.
• The Board conducts joint investigations with
  inspectors of other ministries, and national and
  international law enforcement bodies.
• (Relevant institutions in USA, Canada and other
  countries work in active cooperation with Turkish
  Financial Inspection Board because of its duties,
  powers and past experiences)

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Inspection of Foreign Exchange Transaction

• Inspection and Investigation about real and
  corporate people carrying activities against The
  Law Concerning The Protection of The Value Of The
  Turkish Currency (No1567)

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Investigation of Public Officers

• Investigation of Public officers claimed
  activities against criminal and disciplinary
  laws.
• The Inspection Board of Finance conducts
  administrative anti-fraud investigations. This
  function is also related to corruption
  investigation cases.
• There are three types of investigation conducted
  by finance inspectors.
• - Disciplinary investigation for public
  officials
• - Criminal investigation for public officials
• -Law No 3628-Law No 4483
• - Other criminal investigations
  (eg.Laws no5549,1567,4926)

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Functional Inspection (Studies on organizational
aspects of ministry structure)

• Continuous investigation of system process
  analyses of financial administration
• Functional analysis on increasing
  interdepartmental coordination.
• System analyses which will contribute to global
  management strategy of the institution
• Determining organized and systematic crimes and
  potential crime areas.

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International Audit
Auditing of the utilization of the project
credits provided to public institutions by World
Bank and The European Union Funds. Annual audit
of Economic Cooperation Organization (ECO)
accounts
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Expertise to Turkish Grand National Assembly
Inspection and Investigation Commission on
Corruptions

• Upon the demand of Parliament Inspection and
  Investigation Commissions on Corruption, In
  various times Finance Inspectors are commonly
  delegated to the studies of these commissions.

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Expertise to Judicial Bodies

• Expertise Services Judicial Bodies, in areas
  where special financial knowledge are needed by
  their demands

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Counsultancy Service

• FIB gives opinion on new regulations planned to
  be introduced or the points in current financial
  system,
• To propose new regulations or revisions on
  current financial system and to make suggestions
  for improving the application of regulations.
• To prepare recommendation reports to develop
  strategies for good governance, for fighting
  against fraud, corruption and other illegal
  activities.

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Training Services

• Finance Inspectors provide trainings within the
  following organizations on various subjects in
  accordance with the requests
• Units of Ministry of Finance
• Other public administrations
• Universities

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Conclusion
In the light of the objectives achieved and
planned to be achieved, FIB aims to be an ideal
model for other public administrations. Thus,
transparency is given priority.
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Thank You