Over view of

1-The Islamic Republic of Iran

Iran being situated in the Middle East is the 16th largest country in the world and was settled some 3500 to 4000 years ago by the Aryan people. Tehran is the capital city of Iran with a population of over 10 million.

Iran is a mountainous country which has a variety of climates (mostly the continental type) and possesses the largest lake of the world. The Caspian Sea covers part of the northern border of Iran.

98.8% of the Iranian population consists of Muslims, 91% of which are Shi’as. The official language of Iran is Farsi (or Persian) and the official flag of Iran is in the three green, white and red colours with the sign of I. R. Iran in the middle and 22 marks depicting Allah- o -Akbar (God is great) inside the green and red border line.

The monetary unit of Iran is Rial (100 Rials = 1 Toman) and the 21st of March is the New year’s day according to the Solar year, the starting point of which is the year of Prophet Mohammad’s flight to Madineh in 622 AD.

Iran is an Islamic Republic (officially declared on the 1st of April 1979) under the leadership of Imam Khomeini. The leader of the Islamic Revolution passed away in June 1989 and Ayatollah Khamenei succeeded through the election of the Assembly of Experts (Majlis - e – Khobregan).

The current President of Iran is Dr. Mahmoud Ahmadinejad who was elected through the General election in 2005.

Iran consists of 28 provinces, 277 townships and 664 districts. The provinces are divided to townships which are in turn divided to districts.

Iran is one of the largest oil producing countries and is divided into three fundamental powers, namely – The Executive, The Legislature, and The Judiciary.


2 – President of the Supreme Audit Court

President of the Supreme Audit Court holds the highest official position existing in the Organization. According to Article 11 of the Supreme Audit Court Act, the president shall be elected by the Parliament upon the recommendation of the Commission on Plan and Budget and Audit of the Parliament. The approval of the MPs is necessary after each inauguration of the Parliament. According to the related law, the President is responsible for the accomplishment of the duties of the SAI.

The President possesses many legal, executive, administrative and financial rights based on the law. Subsequently, all the different sectors work under his supervision.

Dr. Mohammad Reza Rahimi was officially appointed as the new President of the Supreme Audit Court of Iran on the 1st November 2004. He was born in Ghorveh, Iran in 1954 and besides having studied law and obtained a Ph.D degree, he has had the following designations:

  1. Ghorveh provincial Public Prosecutor
  2. Magistrate of the Revolutionary Prosecutor's Office.
  3. Deputy Governor of Ghorveh
  4. Chairman of the First Ghorveh City Council
  5. Governor of Sanandadj - Four years
  6. Member of the Second Parliament – representative of Ghorveh
  7. Member of the Third Parliament – representative of Ghorveh
  8. Member of the Fourth Parliament – representative of Sanandadj, Kamyaran, and Divandareh
  9. Member of the Board of Governors at the Fourth Parliament and head of the Greece and Iran collaboration group.
  10. BoG (Board of Governors) member of the Parliamentary Committees during the 2nd, 3rd, and 4th Parliament – The Judiciary and legal Committee, and the Foreign Policy Committee.
  11. President of the Iranian Athletics Federation
  12. Member of the BoG of the National Olympics Committee.
  13. Member of the Asian Athletics Technical committee.
  14. Governor of Kurdistan province – Recognized as the model Governor the same year.
  15. Councillor of the Head of the Iranian Judiciary.
  16. Head of the Tehran Azad Law faculty
  17. Distinguished Lawyer of the Islamic Republic Iran
  18. President of the Supreme Audit Court of Iran

3 - History:

The Supreme Audit Court of Iran was established in accordance to articles 101-103 of the Constitution and its supplementary Act dated 1906 and 1907. The Supreme Audit Court Act containing 141 articles was ratified in 1910.

The second Audit Act was ratified in 1934. At the time mentioned, the Supreme Audit Court functioned under the direct supervision of the Ministry of Finance and the President and Public Prosecutor of this Organization were recommended by the Minister of Finance and were appointed by the royal decree of the king. The Minister of Finance according to the Employment Regulations selected the staff of the Supreme Audit Court.

During the years 1934 –1973 (around 40 years), no change was made in the Iranian Audit Act and the organization continued to operate under the supervision of the Ministry of Finance. In 1973, the third Audit Act was ratified. The same law had been prepared in such a way as to allow the Iranian SAI to examine only 30% of the national budget. According to this act the President of the Supreme Audit Court was considered as an equal to Deputy Minister of Finance.

After the Islamic Revolution of Iran in 1979, according to article 54 of the Constitution, the Supreme Audit Court was assigned to operate under the direct supervision of the Islamic Consultative Assembly [1]. The Supreme Audit Court was thereby appointed to act as a legal inspector and auditor of the country. In 1982, the new Audit Act was ratified by the Parliament based on articles 54 and 55 of the Constitution. This Act bestowed extensive auditing powers to the Organization.


4 – Responsibilities and powers:

According to the articles 1 to 7 of the Supreme Audit Court Act, this organization has the following responsibilities and powers:

Article 1- The objective of the Supreme Audit Court as stated in the articles of the Constitution of the Islamic Republic of Iran is the exertion of continuous financial control and supervision in order to safeguard the Bait- ul- mal[1] through the following ways:

1 -To control financial operations and activities of all Ministries, institutions, government companies and other organizations which in any manner whatsoever benefit from the state budget.

2 - To examine and audit funds spent and the revenues and other sources of obtaining revenues in relation to the financial policies stipulated in the approved budget with consideration of the operational and auditing report received from the related auditees.

3 -Preparation and drawing up of the budget liquidation report together with its own comments and its presentation to the Majlis.[2]


Article 2 - Examining or auditing all the revenue and expenditure accounts and other receipts and payments, as well as financial statements of organizations from the viewpoint that they comply with financial rules and regulations and other relative laws and indispensable criteria.

Note – According to this Act, the organization shall include all the Ministries, organizations, institutions, government companies, and other organizations which in any possible way benefit from the State budget and in general any executive organization on which, according to articles 44 and 45 of the Constitution, public ownership is applied to. Organizations that public regulations are applied to must also be audited according to this article.

Article 3- Examining the occurrence of financial operations in government organizations to ensure that expected revenues have been obtained and these revenues have been deposited in the related accounts timely and properly and to ensure that expenditures and other receipts and payments are correct.

Article 4- Examining the accounts of properties and assets of the organizations.

Article 5- Examining and ensuring that appropriate financial methods and directions have been established and that these methods and directions are applied effectively in order to achieve the auditees’ objectives.

Article 6- Commenting on the necessity of the existence of the internal controlling organization or the insufficiency of the existing organization in the auditees. This opinion is expressed according to audit reports and examinations done in order to safeguard the Bait-ul-mal[1]

Article 7- Examining the deficit accounts of assets and financial violations and any kind of discrepancies in accounts that the related government officers have committed in implementing the rules and regulations by the manner determined by this law.

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6- Auditing Procedures:

The Iranian SAI, like other Supreme Audit Institutions around the world, has performed financial auditing or traditional auditing during the 90 years of its existence. In recent years, the Iranian SAI has focused on performance auditing in its examinations. In performing this duty, the SAI evaluates the strength and weaknesses of the present rules and regulations and financial procedures to provide necessary background for conducting this type of audit. In this regard the Iranian SAI has planned to examine the construction projects from the aspects of economy, efficiency and effectiveness, so that the auditors can evaluate the actual costs of projects and thereby simultaneously reduce the expenditures and increase the efficiency. Another important thing the Iranian SAI is focusing on is the prevention of the violation of financial rules and regulations in the auditees. This is accomplished through the presentation of technical advice and consultation and by holding explanatory meetings for the financial managers of government organizations and companies. This has, to some extent, reduced the occurrence of violations in the auditees.

Audit process in the Iranian SAI is as follows:

1 -According to the organizational chart of the Supreme Audit Court of Iran, there are two Directorates, one for the auditing of Ministries and the other for companies.

2 - Auditors perform their audit duties in one of the said Directorates based on their experience and technical knowledge.

3 - First of all, audit teams are formed based on the audit priorities. The said teams consist of several auditors. The number of the auditors in each team is determined based on the amount of audits.

4 - The audit teams take position in the auditees and start examining the accounts and records of that particular auditee.

5 - If the auditors come across any violation of rules and regulations, they shall duly report to the General auditors, who are in fact their superiors, in the Supreme Audit Court.

6 -The General auditors after examining the said report, shall consequently refer the case to the Public Prosecutor’s Office for legal examinations.

7 - The Public Prosecutor shall at this stage refer the case to one of the eleven judicial branches for further examination.

8 - At this stage, the branch responsible for the case shall ask the auditee to supply the necessary documents and if the branch should consider it as necessary shall then summon the head of auditee to hear his defense.

9 - If the branch realizes that based on the existing evidence, the auditee has violated the rules and regulations, it shall then supply a report and send it together with the case to the Public Prosecutor for further action.

10 – The Public Prosecutor studies the case thoroughly and shall decide whether to prosecute or drop all the charges.

11 – If the Public Prosecutor should believe that the related laws have been violated, he shall then refer the case to the President of the Supreme Audit Court.

12 – At this stage the President of the Supreme Audit Court, who is now fully informed on the details of the case, refers it to one of the four Judiciary Boards for legal prosecution.

13 – The Judiciary Board responsible shall then attend to the case by summoning the related authorities and hearing their defense. They can now pass judgment on the case. They shall duly condemn the infringers to the administrative punishments.

14 – The judgments passed by the Judiciary Boards may be appealed by the request of the Public Prosecutor or the losing party.

15 - The Supreme Audit court of Iran is only obligated to attend to non – criminal cases. The criminal cases are consequently referred to the Judiciary.

16 - Having examined the accounts of the auditees, the audit teams residing in the auiditees, prepare a report regarding their annual operations and present it to the Supreme Audit court. The information obtained from the auditees by the audit teams is used to prepare the Annual Report.

7- General Board:

The General Board of the Supreme Audit Court will be able to hold a meeting with the presence of at least three-quarters of the main judges of the SAI, upon the invitation of the President of the SAI. The General Board will be presided over by the President of the SAI to attend the following matters:

1 - To create a uniform and binding precedent in performing the duty of the Judiciary Boards

2 - To approve the budget liquidation and its final report

3 – To hold special sessions to appraise any other matter deemed necessary by the President of the Supreme Audit Court

The decision made by the Board shall be made valid by the vote of the absolute majority of those present in the session.

8: Public Prosecutor’s Office

The Public Prosecutor’s Office of the Iranian SAI consists of a Public Prosecutor, two Deputies and some assistants to the Public Prosecutor (according to their need) and an office. The Public Prosecutor of the Iranian SAI is appointed through the recommendation of the Commission on Budget and Audit of Parliament and the final approval of the MPs. The Public Prosecutor officially starts his / her commission after the inauguration of each Parliament.

The duties of the Public Prosecutor’s office are as follows:

1 - To ensure the right use of Public Treasury in the legal framework

2 - To draw up petition against the related officials to be examined in the Judiciary Boards of the SAI or to be referred to the Judiciary according to note 1 of article 21 of the Supreme Audit Court Act.

According to the new organizational structure, the Public Prosecutor’s Office consists of 11 judicial branches. These branches are formed upon the recommendation of the Public Prosecutor and the approval of the President of the SAI. The judicial branches attend to the legal cases referred to these branches by the auditors and their superiors and state their opinion thereon. The same opinion is announced to the Public Prosecutor for the final decision.

9- Judiciary Boards:

The Judiciary Boards are in fact the Courts of the Iranian SAI (Supreme Audit Court). They attend to the legal cases referred to them by Public Prosecutor’s Office and pass judgment there upon. The Iranian SAI consists of four Judiciary Boards at the most. Each Board contains three judges one of which chairs the Board. These judges are appointed by the recommendation of the President of the Iranian SAI and by the approval of the Commission on Plan and Budget and Audit of Parliament. The responsibilities of the Judiciary Boards have been specified in Article 93 of the Supreme Audit Court Act.

10- Staff Employment

The Staff Recruitment Office of the Iranian SAI should evaluate whether there is a need for recruiting auditors, experts and office personnel. The mentioned office constitutes of three people who perform basic evaluations and report to the Head of the same Office.

The Personnel Office, based on the above – mentioned report, publishes an employment advertisement in the national dailies. In this way, people qualified for the specified jobs are able to send their applications to the Personnel Office. The applicants sit for an entrance examination and are consequently informed of the results. The accepted people are later introduced to the Selection Office where they are interviewed on their religious and social background.

The accepted people shall cooperate with the organization based on a one year contract. They are later employed officially by the SAI upon the consent of their superiors. The new recruits are provided with necessary training and later on they take charge of their specified responsibilities.

In recent years, due to the expansion of the scope of audits and duties of the Supreme Audit Court, the employment rate of auditors, experts and office personnel has increased. At present, the total number of the personnel working for this organization consists of 1716 people.


11 - Educational Activities:

Staff training is one of the most effective methods of developing the potential and hidden talents of the personnel which in itself plays a critical role in the realization of all the aims and hopes of an organization. Staff training helps improve the staff ability and capability in their work accomplishments and we can therefore admit that training is indeed the life source of the organization.

The Supreme Audit Court of Iran has always devoted a substantial part of its efforts to the training and education of its staff in different technical and professional fields in order to be able to shield the Public Treasury.

A: Training Activities,

1-On Job training: different short - term technical and general courses have been held for all levels of work. Staffs have been trained in auditing, computer, technical English, and administrative affairs.

2- Regional training of managers: Three different training courses of this kind are held in various provincial branches for staff Managers and the Director Generals. These courses were called “ Regional Forum of Managers”. The Deputy Auditor Generals also attend in the said Forum.