Reconstruction of the Bohemian National Hall in New York too expensive
Press Release – April 8, 2010
From May to December 2009, auditors from the Supreme Audit Office (SAO) performed an audit of the state property managed by Ministry of Foreign Affairs within the period from 2007 to 2008. Auditors found errors in accounting and concluded that the Ministry failed to remedy several shortcomings that had been found during the auditing operation No. 05/09 – Ministry of Foreign Affairs economy management.
Auditors concluded that Ministry of Foreign Affairs failed to take proper accounting within the period from 2007 to 2008. By sample of tangible property worth more then CZK 1.8 milliard, auditors found errors, which often included ill-defined items of the tangible property in the respective accounting years. In 2007 and 2008, inventories of the tangible property did not conform to the Accounting Act and the inventories missed some obligatory terms.
As the administrator or partner of most of the 21 audited investment ventures, the Ministry failed to adhere to the Government decree on the state budget participation in programmes for reproduction of property and did not ensure all procedures defined therein.
The transfer of the Bohemian National Hall ownership as well as its reconstruction were funded from the Ministry’s program entitled “Acquisition and reconstruction of the investment property in foreign countries“ (Pořízení a technická obnova investičního majetku Ministerstva zahraničních věcí v zahraničí). The audit revealed that the project was not designed in conformity with the Government decree on the state budget participation in programmes for reproduction of property. Contrary to the Act on Budgetary Principles, the decrees on registration of the investment venture and on the state budget participation in the investment were issued without the consent of Ministry of Finance.
“Ministry of Foreign Affairs lacked an explicit conception of the planned reconstruction. During the reconstruction, the documentation was repeatedly amended and works under development were continuously modified. There were several hundreds of partial construction changes and technological alterations. The overall costs were initially planned to reach CZK 235 million but the value of the reconstruction is expected to rise to CZK 812.6 million and the accomplishment terms exceeded from December 2004 to October 2010“, said president of the SAO František Dohnal.
The auditing operation was included into the SAO’s 2009 Audit Plan under No. 09/14. Antonín Macháček, Member of the SAO Board, controlled the operation and prepared the audit conclusion as well.
Bc. Radka Burketová
Press Speaker
Supreme Audit Office