Audit Office Finds: Bešlić Lacks Justification for Millions of Convertible Marks Spent from City Budget

The financial report of the City of Mostar does not truthfully present the state of assets and liabilities of the City of Mostar as of December 31, 2015, nor does it truthfully present the City's operations or cash flow. This is stated in the report of the Audit Office of Institutions in FBiH, writes Patria.

The auditors state that the fixed assets and sources of fixed assets of the City of Mostar, as of December 31, 2015, are not reconciled for as much as 17,454,310 KM, of which 385,885 KM relates to unreconciled balances from 2015, and 17,068,425 KM relates to unreconciled balances from previous years.

Short-term receivables recorded as of December 31, 2015, in the amount of 22,323,402 KM, are also not realistically presented, as there is no documentation for certain receivables.

Local elections in Mostar were held in 2008, but not in 2012, so the City has not had a City Council for four years. The City of Mostar is managed by HDZ mayor Ljubo Bešlić. He also manages the city budget.

The auditors state in the report that the financial result for 2015 is not accurately stated by at least 1,622,292 KM. Long-term liabilities from two loans: World Bank Loan for Urban Infrastructure Project 1 (1,290,511 KM) and Urban Infrastructure 2 Parking Mostar loan exceeding five million KM are not recorded in the business books of the City of Mostar, due to which long-term liabilities for 2015 are underestimated by the stated amounts.

The allocation of grants to non-profit organizations in the amount of 421,084 KM was not carried out based on measurable criteria for awarding current grants to citizens' associations, in order to ensure transparency in the spending of public funds.

The auditors also state in the report that in 2015, work contracts were concluded in the amount of 103,854 KM (gross 122,547 KM), for jobs that are largely defined by the Rulebook on Internal Organization and Systematization and represent regular duties of employees, such as: accounting work, advisor to the mayor for finance, provision of legal and professional services to former combatants, and work performed by firefighters.

The auditors' report further states that the inventory of assets and liabilities for 2015, as well as the reconciliation of bookkeeping with the actual state of assets and liabilities as of December 31, 2015, was not carried out in the manner and within the deadlines in accordance with the Law on Accounting and Auditing in FBiH, the Decree on Budget Accounting in FBiH, and the Rulebook on Budget Bookkeeping in FBiH, writes Patria.