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The Armenian government will control the expenses of state non-commercial organizations

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The Armenian government intends to transfer the accounts of all state non-commercial organizations (SNCO) from commercial banks to the treasury.

According to the Minister of Finance of Armenia Atom Janjughazyan,  after the Cabinet of Ministers introduced certain amendments to the  RA Law on the Budget System and a number of accompanying laws in  December 2017, it became necessary to revise this rule so that it  could serve the accounts of the SNCO procedure), and state funds and  joint-stock companies with state participation (on a discretionary  basis).

The Minister of Culture Lilit Makunts, who stated that she was concerned about the project and suggested that it be postponed for at least six months, responded the bill. In addition, the head of the  Ministry of Culture stated that during the interaction with the organizers of international festivals, they refuse to pay to the treasury account when making payments - fees and payments for performances, wishing to work exclusively with commercial banks in order not to deal with bureaucratic delays.

Janjughazian agreed that it is possible for SNCO to work hard, since each time when purchasing, even in small volumes, they will have to get permission from the state treasury. "Today, the accounts of these  SNCOs are in commercial banks, and there are no mechanisms for preventive control over the use of these funds. This applies not only to cultural but also to other SNCOs. The Ministry of Finance approves the estimates, they also submit reports, but what happens during the year, no one, in addition to the executive leadership of the SNCO,  was not informed," the minister said.  

As the Finance Minister explained, during this year the SNCO accounts will be transferred to the treasury, and from  January 1, 2019, they will be subject to a preventive control mechanism. And this, as specified by Janjugazyan, means that all state structures will be obliged to fix them in the electronic procurement system when concluding procurement contracts. Further,  when making payments that do not correspond to the expenditure items of the document, the system will not accept payment orders for execution. This, he noted, will become a deterrent mechanism for all those who today use items of expenditure for other purposes, for example, sending money from the salaries fund for repair work.


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