Meeting of the Policy Group on Statistical Cooperation - PGSC COST ACCOUNTING IN THE ESS/NSIS Presentation of MONSTAT on cost accounting/time registration system 13-14 October 2016, Zadar, Croatia Bojana Radojevic – Head of Department for national coordination Statistical office of Montenegro – MONSTAT

COST ACCOUNTING in MONSTAT Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future; MONSTAT introduced the concept Public Internal Financial Control - PIFC P - public sector; I - internal (in institution/organization); F - financial system, but not only; C - control based on the internationally accepted and recognized standards.

PIFC concept PIFC concept - based on internationally accepted and recognized standards, the term and the concept developed by the European Commission in order to facilitate the understanding and implementation of a well-developed and efficient system of internal controls in the EU accession process; The aim of this concept is to ensure that public funds are well managed (both national and EU funds), and to control costs in an efficient manner; It covers all internal control systems and procedures in public enterprises and helps in providing reasonable assurance that public funds are spent appropriately;

PIFC model = FMC + IA + CHU PIFC concept Framework of PIFC are three pillars: FMC - financial management and control; IA - internal audit; CHU - Central Harmonization Unit. PIFC model = FMC + IA + CHU They work together in order to provide reasonable assurance that internal controls are functioning properly and efficiently

PIFC model = FMC + IA + CHU PIFC concept PIFC model = FMC + IA + CHU Financial management and control - FMC need for accountability managers of the internal control process; Internal audit - IA - functionally independent and decentralized internal audit, which examines the effectiveness of internal controls; Central Harmonization Unit - CHU - special organizational unit that develops and directs the process of PIFC.

PIFC concept PIFC concept - based on internationally accepted and recognized standards, the term and the concept developed by the European Commission in order to facilitate the understanding and implementation of a well-developed and efficient system of internal controls in the EU accession process; The aim of this concept is to ensure that public funds are well managed (both national and EU funds), and to control costs in an efficient manner; It covers all internal control systems and procedures in public enterprises and helps in providing reasonable assurance that public funds are spent appropriately;

PIFC concept - Financial management and control - FMC FMC Rulebook is book of internal procedures and other documentation is the methodological guide financial management and control of MONSTAT and changed where necessary to satisfy the characteristics, circumstances and requirements of PIFC concept; This document was created with the aim to provide customers with detailed information relating to the mode of financial management and control in MONSTAT; Financial management and control - FMC is an area of internal controls that indirectly affect the implementation of all activities within MONSTAT. Manage finances in the public sector involves many activities of financial control, because all managers have a duty and obligation to ensure the best use of resources to prevent waste and misuse of assets, fraud and corruption.

PIFC concept - Financial management and control - FMC FMC Rulebook consists of 6 Chapters: Financial legislation; Budgeting and strategic planning; Internal financial procedures ; Organization of financial departments; Financial reporting; Financial monitoring. MONSTAT until now have two FMC Rulebooks, first prepared 2012. and second version (updated) in 2015. Detailed explanations in planning, spending, control and financial reporting + 25 procedures;

PIFC concept - Instructions on how to plan budget Defining the financial resources necessary for the implementation of individual statistical survey: Number of employees; General expenses that indirectly affect the cost of the statistical survey (costs of administration, maintenance, insurance, banking services, entertainment, business trips, expenses for fuel, services of professional training); Costs that directly affect the cost of the statistical survey (costs of interviewers, printing costs, procurement of office supplies, postal costs, telephone services, provision of equipment printing, trainings, perdiam for interviewers, travel expenses interviewers, costs fieldwork, data entering, publishing the results the survey.

Cost by statistical survey in Annual plan

PIFC concept - Instructions on how to plan budget Budget planning and cost accounting is important for the fulfillment of the mission and a set of key objectives MONSTAT, the effective use and allocation of resources for effective financial control in all activities MONSTAT; The budget plan for fiscal year business must be prepared to match the goals of statistical activities and defined priorities. Special emphasis is placed on the effective implementation of the Annual Plan of Official Statistics and Programme specifically expressed through the current budget. The budget planning process for the business fiscal year begins by defining the Annual Plan of Official Statistics for the next year and a budget circular which is the responsibility of Ministry of finance.

PIFC concept - Financial monitoring On an annual basis MONSTAT have financial monitoring by CHU - Central Harmonization Unit. Annual report prepared by MONSTAT and CHU - Central Harmonization Unit. General remark is that MONSTAT are very good organized institution according PIFC concept Next step is the Risk assessment and Risk register

TIME REGISTRATION

Time registration - system Regular working hours: working on the regular working assignments (defined by the strategically documents: Program of official statistics 2014 – 2018, Annual plan of statistical surveys). Overtime working hours: Overtime for the regular working assignments working on additional working assignments (International Programme and projects) All time spent on the job is registered by the signature of all employees

Time registration – allocation of assignments Timetable of activities (regular and overtime): allocation of the working assignments – management working plans. Working assignments have been distributed by employee: Regular: by the regular working assignments (everyday job) Overtime: Overtime for the regular working assignments - management working plans working on additional working assignments (International Programme and projects) – project coordinator working plan All time spent on the job is registered by the signature of all employees

Time registration – registration system All time spent on the job is registered by the signature of all employees: Within all department we implement a system of signature: all employee are signing the presence sheet where we mention the name and time of enter and departure from the job Monitoring and control of the presence sheets are the obligation of the Head of the Departments

Time registration – controlling system Controlling the regular working hours: all employee are signing the presence sheet where we mention the name and time of enter and departure from the regular job Control mechanism of the regular working hours is the Head of the department who is confirming the regularity of the signed presence sheets Controlling the overtime: Overtime for the regular working assignments and additional working assignments all employee are signing the presence sheet where we mention the name and time of enter and departure from the overtime job Control mechanisms: Head of the department who is confirming the regularity of the signed presence sheets Confirmation (signature) of the project coordinator that the assignment have been finished/submitted in the requested time Timesheet of the month signed by the employee, project coordinator and relevant assistant director after the checking of the presence sheets and outputs of the working assignments

Time registration – controlling system Controlling the overtime: Overtime for the regular working assignments and additional working assignments The regularity of the timesheets are checked once again on the regular management meetings between the director and assistant directors where the assistant directors are presenting the results of the regular and overtime assignments.

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