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Restriction of tax audit violates international rule

August 21, 2009 - 08:50 AM

Restriction of access of the Supreme Auditor Board (BPK) to obtain information about tax revenue and overseas loan projects is deemed contravening international rules and practices, Bisnis Indonesia Daily reported on Friday.

The Dutch Financial Auditor Board or Algemene Rekenkamer (ARK) recently conducted peer review of Indonesian BPK with a view of ascertaining quality controlling system of the institution. Pursuant to the report, BPK still encounter obstacle to execute the mandate, such limited access to obtain information about income from tax office.

The restriction is contradictory to the Declaration of International Organization of State Audit Institutions (Intosai) 1997, which is affirmed in Mexico Declaration 2007 stating that unlimited access to information is deemed to exercise responsibility in accordance with legislation.

President of the Netherlands Court of Audit Saskia J. Stuiveling said that in a bid to overcome the problem, BPK RI must pay full attention to the restriction of the audit access through constructive communications with the government, namely Finance Minister, Parliament and donors.

"Cooperation between the Parliament, Finance Minister and BPK is needed to settle the problem, Saskia said upon delivering the report.

Sharing of the same view as Saskia, Deputy Speaker of Commission XI of the House of Representatives of the Republic of Indonesia Walman Siahaan said that the parliament would support fully BPK to secure access to audit tax revenues and projects financed by overseas loan.

"In this case, we support fully audit of taxes and overseas debts. BPK must know the whole assets of the state and report on accountability for the assets," he said, adding that BPK is the only auditor institution authorized to audit financial management of the whole state assets.

Chairman of BPK Anwar Nasution said that his institution would follow up recommendations of ARK by means of among others, preparing action plan in two months, which would be communicated with ARK and DPR.

The result of peer review also spotlights poor financial management in the central and regional governments and rampant irregularities and corruption in the government and society. ARK recommends BPK to develop strategies with the government and parliament to enhance the quality of state finance management and focus on financial audit. (*)

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