EU4PFM and the Ministry of Finance held a webinar on internal control for key spending units

More than 400 participants from different regions of Ukraine discussed how to strengthen internal control in budget spending units in practice, including in the context of Ukraine’s EU accession.

Manfred van Kesteren, EU4PFM expert on Public Internal Financial Control (PIFC), discussed priority areas for strengthening internal control, drawing on assessments such as those by OECD/SIGMA and looking ahead to issues likely to receive attention in future assessments. He stressed that implementation matters: a sound regulatory framework must be reflected in how managers set objectives, manage risks and take decisions in their organisations. Particular attention was given to managerial accountability, risk management and the handling of irregularities. 

“Internal control is management in action. It starts with an organisation’s objectives, not with a checklist. Managers are responsible for risks, control measures, resources and results,” the expert concluded.

William Fraser, EU4PFM PIFC expert, explained how objectives, budgeting and risk management are interconnected, and what role financial and economic units play in this process. Strategic planning sets the policy directions, objectives and results the government aims to achieve. The budget makes these priorities feasible in practice by allocating financial, human and capital resources across programmes and services.

“In effective public finance management systems, the budget is not a separate technical exercise, but a tool for translating organisational objectives into action. When objectives, resources, risk management and internal control are aligned, policies are coherent, fiscal discipline is maintained, and service delivery is results-oriented and accountable”, Mr Fraser noted.

The webinar also featured representatives of the PIFC Harmonisation Department of the Ministry of Finance, who spoke about the regulatory framework for internal control and provided comments on common practices for improving it.

In the second part of the webinar, EU4PFM experts presented the results of a pilot internal control project at the Ministry of Justice and the lessons learned from it:

1. The methodology needs to be applied repeatedly in practice. Practical support should complement the methodology rather than add another layer of requirements.
2. Internal control works when management processes are interconnected.
3. Tools are important, but management responsibility and organisational culture matter more.
4. Pilot projects deliver results when there is readiness, clear responsibility and follow-up action.

EU4PFM will continue supporting the Ministry of Finance in translating internal control requirements into everyday management practice, with particular attention to managerial accountability, risk management and the handling of irregularities.