The Independent Defence Anti-Corruption Committee (NAKO) announced on June 19th that it is in favour of the revised tender for an independent audit and strategic analysis of Ukroboronprom. It has reestablished dialogue with Ukroboronprom and intends to monitor the tendering process.
NAKO said that the process is the opportunity to bring light to inefficiencies, corruption risks and structural deficits at Ukroboronprom and will be a first step towards resolving these issues and building a state-owned defence establishment that meets the needs of the public and armed forces. The NAKO committee stated that the creation of the independent Supervisory Board, which was renewed with the appointment of Mykhaylo Zgurovsky by President Petro Poroshenko this January, is a key step towards having effective governance. The Supervisory Board will be the main customer in the upcoming tender.
Volodymyr Ohryzko, NAKO Co-Chair, stated:
The Supervisory Board of Ukroboronprom is responsible for reforming the institution so that it meets the interests of the public and the Ukrainian state. This audit, in line with international standards, will aid the Supervisory Board in carrying out their responsibility and raising the company to meet international standards of governance.
The call for tender includes three parts: 1) strategic consulting and an assessment of the corporate governance of Ukroboronprom and its member сompanies, 2) a legal review, diagnosis and consultation of Ukroboronprom and its member companies, 3) an independent financial audit of Ukroboronprom and its member companies.
The original tender did not include some of these components, including the independent financial audit. The NAKO provided recommendations to Ukroboronprom’s Supervisory Board about what should be included in the tender, and the Supervisory Board revised it in line with these recommendations. Following those amendments, the tender process is currently underway. The deadline has been extended from June 18th to September 28th in order to give a broader range of companies the opportunity to bid.
Drago Kos, NAKO Co-Chair said:
We hope to see a strong pool of auditing firms bidding for this. It is undoubtedly complex – but if it can be reformed, the impact on Ukraine and its future will be historic.
Olena Tregub, NAKO Secretary General confirmed that:
The NAKO continues to monitor this tender; our aim is to ensure that the reform of Ukroboronprom is provided with clear advice on the corporate structure and management, and that a full financial audit will identify financial black holes in the company – and will facilitate an evidence-based reform programme.
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More details on the tender could be found at the following link: https://prozorro.gov.ua/tender/UA-2017-12-20-003453-c