However, no details were given regarding the deadline for closing these internal accounts.

SAO President Dr Bouasy Lovanxay raised the issue yesterday at the ongoing Second Ordinary Session of the National Assembly (NA), proposing that the NA take decisive measures to force state organisations, which earn revenue through a variety of services, to register all their income with the National Treasury.

He also proposed that the NA advise the government to stop any projects that were not named in state budget plans.

Referring to the SAO’s auditing of the state budget for the 2009-2010 fiscal year, he said not all income earned by some state organisations, such as from selling timber and other services, was sent to the national budget; moreover the money was spent in ways that did not conform to the Budget Law.

According to the SAO report, the national revenue collection plan for the 2009-2010 fiscal year achieved higher than expected results. The plan had been expected to yield 2,943.72 billion kip from 16 provinces, but managed 3,152.16 billion kip, or 107.08 percent of the plan.

However, there were some weak points, as some organisations’ budgets targeted sums that were much lower than their potential.

“This problem shows that budget planning is not suitable for the level of the nation’s socio-economic growth,” Dr Bouasy told the meeting.

SAO’s audit showed that in 2009-2010 about 282.38 billion kip was accrued from the services provided by 28 state organisations, of which only 109.25 billion kip was sent to the National Treasury, with about 115 billion kip spent on projects outside of the budget plan.

In addition, up until September 30, 2010, some 58.20 billion kip remained in the internal accounts of state organisations.

The total income earned from the sale of timber in 2009-2010 reached about 315.57 billion kip, but only 69.37 billion kip was handed over to the state budget, while 125.84 billion kip was spent on unapproved projects. As of September 30, 2010, some 120.36 billion kip earned from the sale of timber remained in internal accounts.

The report also shows that three ministries spent 54.97 billion kip from the state trust fund on projects that had not received NA approval.

The SAO President told the meeting that the finance departments of these organisations did not strictly follow the Budget Law.

“Some organisations create their own rules, defining service fee rates and administration payments that violate the presidential decree on services fees,” Dr Bouasy said.

Previous meetings of the NA agreed to penalise organisations that broke the law by cutting their budget by 20 percent for the 2010-2011 fiscal year, and ordering them to pay a proportion of the 26.38 billion kip withheld from the National Treasury.

According to the latest audit by the SAO, some of this 26.38 billion kip has already been added to the national budget, while there are plans to continue to retrieve money kept in internal accounts for addition to the National Treasury in future fiscal years.

The report also details the audit results of the nine state enterprises, revealing that most performed well, but some spent a lot on administration, meaning they could not fulfill their obligations to the budget.

In addition, the SAO report revealed the audit results of loan and grant aid projects. The SAO examined 21 select projects which borrowed or received assistance from foreign countries and international organisations to implement 21 projects worth US$55.94 million.

The report noted that accounting system standardisation, financial records and other documents in some projects were not comprehensive. This posed the risk of non transparency in payments and some projects squandered too much in various administration costs.