Audit of Forestry and Hunting: Accounting Chamber reveals more than UAH 20 billion in losses
Kyiv • UNN
An audit by the Accounting Chamber found that the war, fires, and illegal logging caused the state to incur losses of almost UAH 23 billion.
The results of the audit of the Accounting Chamber for Forestry and Hunting prove that war, fires and illegal cutting of trees caused the state damage of almost 23 billion hryvnia. UNN writes about this with reference to the press service of the Accounts Chamber.
Details
It is noted that the audit covers the period of 2020-2022 and the first half of 2023. It was found that during this period, UAH 1.9 billion was spent on forestry and hunting from the state budget, and forest users paid UAH 16 billion to the state.
The sector is relatively well functioning and demonstrates good results, given the martial law. At the same time, internal control at the SAFR was not effective enough to prevent violations and ensure executive discipline. This resulted, in particular, in the loss of some documents that were restored only after the audit of the controlled objects was completed
In particular, the auditors found evidence of improper management of state-owned assets by the State Enterprise "Forests of Ukraine": accounting for assets and transfer of property, which created risks of their loss.
Thus, a spot check of the accounting and transfer of property of 19 forestry enterprises with a forest area of 1.3 million hectares revealed that almost 34% of the forest area of the state enterprise was not reflected in the accounting of the state enterprise, and the accounting value of the received assets was not revalued to fair value.
It should be noted that after the facts revealed by the Accounting Chamber, the State Enterprise "Forests of Ukraine" informed that it would engage an independent appraisal company to establish the fair value of the assets
The audit also revealed that during the period under review, the state suffered UAH 20.3 billion in losses from fires and UAH 845.7 million in damage due to illegal tree felling. At the same time, the situation is complicated by the reduction in the number of foresters and the poor work on collecting compensation from violators, as the damage in the amount of UAH 731.0 million was caused by unidentified persons.
In addition, as of July 1, 2023, the war caused damage and losses to the forest fund, its enterprises and institutions worth UAH 1.2 billion.
Also, as the head of the State Forestry Agency Viktor Smal emphasized, about a million more hectares of forest are under the temporary control of the Russian occupiers, 500 thousand hectares of forests - are mined, and 100 thousand hectares are under hostilities.
Addendum
The agency emphasizes that despite the positive trends associated with the industry reform launched in 2022, there are still a number of problems in the forestry and hunting sector of Ukraine.
In particular, it is the weakness of the work on compensation for damages or insufficient control over asset accounting.
According to the Accounting Chamber, Ukraine sold 41.2 million cubic meters of timber and timber products in the period under review:
- 13.3 million cubic meters - to the population and social sector enterprises.
- 11.3 million cubic meters were exported (most of them to Romania, China and Hungary).
The audit showed that over three years, the profitability of the State Forestry Agency's enterprises increased fivefold, the value of assets and equity increased more than 6.4 times, and the amount of equity capital increased by 30 percent. The number of unprofitable enterprises decreased from 17 with losses of more than UAH 53 million in 2020 to six with losses of UAH 43 million in 2022
The agency added that according to the reform that began in 2022, the property, rights and obligations of 146 forestry enterprises were transferred to the newly created State Enterprise "Forests of Ukraine". The number of territorial bodies of the State Forestry Agency - has also decreased from 24 to 9.
Recall
With the help of international partners, Ukraine will establish a Coordination Center for Environmental Damage Assessment to assess and document environmental damage caused by Russian aggression in order to restore ecosystems and recover damages from Russia.
