REPUBLIC OF MOLDOVA - Pempal€¦ · REPUBLIC OF MOLDOVA Moldova is situated in Central Europe, in...

REPUBLIC OF MOLDOVA

Moldova is situated in Central Europe, in North-Eastern Balkans, it has the area of 33,843.5 km2

Population - 3,563,700 citizens

Capital - Chisinau

Moldova is divided into 35 regional administrative units

Moldova is parliamentary republic

2

STATE BUDGET 2010

Revenues – 15.3 bn.lei (1,2 bn.$)

Expenditure s– 19.5 bn.lei (1,5 bn.$)

Deficit – 4.1 bn.lei (-0,3 bn.$) 6,4% of GDP

-5

0

5

10

15

20

SB

15,3

19,5

-4,1

Income

Expenditure

Deficit

3

NATIONAL PUBLIC BUDGET 2010

revenues – 25.1 bn.lei (2,0 bn.$)

Expenditure – 29.7 bn.lei (2,4 bn.$)

Deficit – 4.6 bn.lei (-0,4 bn.$) 7,2% of GDP

-5

0

5

10

15

20

25

30

NPB

25,1

29,7

-4,6

Income

Expenditure

Deficit

4

1.Establishment and development of the Treasury system

2.Treasury system structure

3.Treasury system functions

4.Treasury Single Account (TSA)

5.Public Finance Management Project

5

SUMMARY 1

1. TREASURY SYSTEM CREATION AND DEVELOPMENT

1.1 Legislative and Regulatory norms

Presidential Decree “On State Treasury” (no. 39 of Marth 10, 1993)

Budgetary System and Budgetary Process Law (no. 847-XIII of May 24,1996)

Local Public Finance Law (No 397-XV of October 16,2003)

Annual Budget law

Law on Accounting (No. 113-XVI of April 27, 2007)

Regulations and detailed rules

6

1.2 State Treasury Development Stage I

State Budget:

1993 – 1997 Revenues

1998 – 1999 Expenditure

Stage II

2000 – 2001 Administrative-Territorial Units Budgets (ATUB)

Stage III

2004 Compulsory Health Insurance Fund (CHIF)

Stage IV

2006 State Social Security Budget (SSSB)

Stage V

2007 Treasury Single Account (TSA)

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1. TREASURY SYSTEM CREATION AND DEVELOPMENT

* Closing the current accounts of public institutions in

commercial banks and opening current acounts of territorial

treasuries in commercial banks

* Central Treasury Serving - National Bank

Territorial Treasuries Serving - Commercial Banks8

1. TREASURY SYSTEM CREATION AND DEVELOPMENT

Public Institutions

Commercial Banks

Economic Agents

Treasury

2. TREASURY SYSTEM STRUCTURE

2.1 System Treasury creation steps

1993-1997 State Treasury

1997-1998 State Treasury + 12 Territorial Treasuries

2000-2001 State Treasury + 38 Territorial Treasuries

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2.2 Organigram

Ministry of Finance

State Treasury

(41 per.)

Settlement Center

Autorisation Department

Cash Flow Management Department

Accounts Management Directorate

Operational Department

Expenditure Keeping Department

Revenue Keeping Department

Treasury System Development and

Budget Bookkeeping Methodology Dir.

National Public Budget Reports

Directorate

State Budget and National Public

Budget Reports and Analysis Department

Administrative-Territorial Units

Budgets Reports and Analysis Department

Territorial Tresuries(38 units)

(257 per.)

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2. TREASURY SYSTEM STRUCTURE

3. TREASURY SYSTEM FUNCTIONS

3.1 Treasury System role in the budget process

11

3.2 Basic functions of The Treasury System

Cash execution of the National Public Budget (SB, ATUB, CHIF, SSSB):

-budget revenues accounting (information from MSTI, CS)

-supervision over the efficiency of budget expenditures

Accounting of state procurements within approved budget limits

Resources Management in TSA

Preparation of periodic forecasts of the state budget and ensures liquidity management

Preparation and presentation of regular reports and operative information on cash execution of the national public budget

Approval of accounting methodology in the budget sector

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3. TREASURY SYSTEM FUNCTIONS

4. TREASURY SINGLE ACCOUNT (TSA)

4.1 TSA formation – correspondent account in AIPS

TSA1.03.2007

1.State Budget (revenues)

3.State Social Security Budget (revenues)

4.Compulsory Health Insurance Fund (revenues)

1.01.2008

1.State Budget

2.Administrative-Territorial Units Budgets

3.State Social Security Budget

4.Compulsory Health Insurance Fund

National Bank

&

Commercial Banks

1.State Budget

2.Administrative-Territorial Units Budgets

3.State Social Security Budget

4.Compulsory Health Insurance Fund

13

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4.2 Ministry of Finance and AIPS

AIPS

CB

CB

CB

CB

CB

NBM

AIPS

CB

CB

CB

CBCB

MF

NBM

MF

MF In Client Posture MF In AIPS Participant Posture

4. TREASURY SINGLE ACCOUNT (TSA)

15%

85%

NPB balance in 2006

NPB

CB 87,3%

12,7%

NPB balance in 2010

TSA

CB

4.3 NPB balance in TSA

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4. TREASURY SINGLE ACCOUNT (TSA)

4.4 NPB balance structure in TSA

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4. TREASURY SINGLE ACCOUNT (TSA)

SB

54%

ATUB

12%

SSSB

21%

MACIF

13%

SB

ATUB

SSSB

MACIF

4.5 Analitic structure TSA

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4. TREASURY SINGLE ACCOUNT (TSA)

5. PUBLIC FINANCE MANAGEMENT PROJECT

Purpose – improvement of public finance management

Basic Component of the public finance management project:

objective:

a. budgeting methodology

b. budget execution methodology

c. finance management information system

results:

a. modification of the legislative and methodological framework

b. development and implementation of budget classification and single integrated chart of accounts

c. implementation of public finance management information system

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SUMMARY 2

6.Preconditions for electronic payment systems

7. Specific features of interaction between the State Treasury and banking system

8. Functional scheme of the Treasury Single Account with utilisation of electronic payment systems

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6. PRECONDITIONS

Regulatory basis

Public Keys Infrastructure

Banking technologies

Telecommunication

6. PRECONDITIONS

Electronic document and digital signature law -

№264 from 15.07.2004

Regulations on utilization of remote banking

systems – adopted by Decision of the National

Bank of Moldova Council № 376 on 15.12.2005

Regulations on Utilization of Automated Interbank

Payment System – adopted by Decision of the

National Bank of Moldova Council No. 53 on

02.03.2006

6.1 Regulatory basis

6. PRECONDITIONS

• Root CAISS

• Certification and registration authority for government structures

Special Telecommunications

Center

• Certified digital signatures

Ministry of Finance – State Treasury

6.2 Public Keys Infrastructure

6. PRECONDITIONS

Corporate Data

Network

Government network

Moldtelecominfrastructure

6.3 Telecommunications

6. PRECONDITIONS

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6.3 Ministry of Finance network diagram

INTERNET

Customs

Service

NSIA

NHICSTI

TTTT

Legend:

BCC – Backup Computer Center

NBM – National Bank of Moldovei

NSIA – National Social Insurance Agency

NHIC – National Health Insurance Company

STC – Special Telecommunications Center

STI – State Tax Inspectorate

MCC – Main Computer Center

MTC – JSC Moldtelecom

TT – Territorial Treasury

MTC

TT

NBM

Other Ministries and State

Institutions within the

Governamental Network

Mai

n (x

DSL

MTC

)

Bac

kup

(ISDN B

RI M

TC)

Main (xD

SL MTC

)

Backup (ISD

N B

RI M

TC)

Main (xD

SL MTC

)

Backup (ISD

N B

RI M

TC)

Main

(xDSL M

TC)

Backup (ISDN P

RI MTC)M

ain (xDSL M

TC)

Backup (ISD

N PR

I MTC

)

FOCL MCC-BCC (STC)

FOCL MCC-BCC (STC)

MoF

BCC-STC

(external

systems)

MCC-STC (external systems)

STC

Backup D

ial-up

Dial-u

p

DSL

Moldovan Post

Service

MCC

MoF-MCC (LAN)

Backup DSL

BCC

Commercial

Banks

7. FEATURES OF INTERACTION IN DIFFERENT STAGES

Stage I – The Treasury is a client of Bank

System.

Stage II – The State Treasury became the

participant of AIPS

Stage III – Territorial Treasuries are served via

TSA

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7. FEATURES OF INTERACTION IN DIFFERENT STAGES

State treasury

National Bank

Territorial treasuryCommercial

bank

AIPS

CB

CB

CB

CB

CB

NBM

7.1 First stage

7. FEATURES OF INTERACTION IN DIFFERENT STAGES

State Treasury

National Bank

Territorial treasuryCommercial

bank

Settlement center

AIPS

NBM

CB

CB

CB

CB

TREZMD2X

7.2 Second stage

7. FEATURES OF INTERACTION IN DIFFERENT STAGES

State Treasury

Territorial Treasury NSSB/NHIF

Settlement center

7.3 Third stage

National Bank

AIPS

NBM

CB

CB

CB

CB

TREZMD2X

8. FUNCTIONAL SCHEME OF TSA

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Thank you for your attention