Ukraine’s Financial Control Agenda on the Road to EU Accession

In late February, European Pravda published part of the criteria against which the EU will assess whether Ukraine has met its accession requirements. Financial control is among them — a field directly tied to budget transparency and the state’s capacity to prevent abuse. Given that the European Union is Ukraine’s key financial partner, particular attention falls on how Ukraine’s two main oversight bodies — the Accounting Chamber and the State Audit Service — are functioning.

The Accounting Chamber’s priority is ensuring its political, financial, and administrative independence and powers in line with the INTOSAI standards.

In late 2024, the Verkhovna Rada passed a reform law aimed at strengthening the Accounting Chamber’s capacity and securing all aspects of its independence. Among other changes, the competitive selection procedure for Chamber members was revised to reduce parliamentary influence and bolster political independence. The key innovation was to be a dedicated Advisory Group of Experts — with international experts holding the majority vote — to screen candidates for appointment to the Accounting Chamber.

Since June 2025, however, the Verkhovna Rada has been unable to vote to establish the AGE, which, in addition to three international experts, is to include three representatives of parliamentary factions or groups. This has effectively blocked the competition. As a result, the Accounting Chamber has been operating with a reduced composition for nearly two years, with more than half of its seats vacant (6 out of 11). Parliament must find a compromise and bring the question of establishing the AGE to a vote as quickly as possible to unblock the competition, and then ensure that candidates are appointed to the vacant positions once it concludes.

The picture on financial and administrative independence is less clear, as it remains uncertain precisely what steps the EU expects Ukraine to take in these areas. 

In late 2024, Accounting Chamber officials, including state auditors, were removed from the scope of the Law on Civil Service, with their salaries and additional payments set directly in the Chamber’s own legislation, placing them beyond government influence. In January 2025, parliament amended the Budget Code to introduce a special procedure for government and parliamentary review of the Accounting Chamber’s budget requests. 

The 2024 law also removed parliament’s ability to assign unscheduled oversight activities to the Chamber by resolution, thereby securing the body’s independence in planning its own work. 

The administrative independence question likely relates to the requirement that the Accounting Chamber’s maximum staff numbers be approved by a Verkhovna Rada committee — a statutory constraint designed to maintain a balance between institutional staffing and the budget required to support it. It should be noted that in August 2025, less than a year after the Accounting Chamber’s salaries were increased, an attempt was made to raise them again through an amendment to an unrelated bill and without adequate justification. 

Beyond independence, the Accounting Chamber must first address its staffing deficit. As of October last year, the body was operating at 65% of its authorized headcount and in some regions at just 50%, directly affecting its institutional capacity.  

On balance, we consider the Chamber’s financial and administrative independence to be adequately secured at this point.

As for compliance with INTOSAI standards, the Accounting Chamber approved updated audit methodologies back in 2023, and parliament enshrined in law in 2024 a requirement that these methodologies conform to the INTOSAI IFPP. However, the updated methodologies have yet to be published, despite the statutory requirement to do so. 

The State Audit Service features in the EU’s accession criteria indirectly, in the context of protecting the EU’s financial interests. 

The priority task in this area is to align Ukrainian legislation with EU acquis on combating fraud and any other illegal activity affecting the EU’s financial interests and to ensure that the relevant national coordination body has the mandate and operational capacity to do so.

In Ukraine, it is the State Audit Service that performs the functions of the Anti-Fraud Coordination Service (AFCOS). That status carries a set of concrete obligations:

• exchanging information with the European Anti-Fraud Office (OLAF) 
• assisting OLAF in conducting administrative investigations and inspections
• coordinating between OLAF and Ukrainian anti-fraud liaison bodies.

We have previously flagged a potential problem in the conduct of administrative investigations and inspections: State Audit Service inspectors lack sufficient powers to obtain documents and information from companies and individuals necessary to investigate violations. 

In November last year, the government expanded the Service’s powers during audits and procurement inspections — primarily by broadening the range of entities subject to oversight. However, these changes are limited in scope and apply only to the control of funds received under the Ukraine Facility. Without comprehensive legislative amendments, investigating potential misuse of EU funds may remain significantly hampered.

Importantly, the changes adopted last year may partially support another aspect of the EU anti-fraud agenda — establishing cooperation with the European Commission, OLAF, and the European Public Prosecutor’s Office (EPPO) on reporting violations and conducting investigations related to EU funds. The government expanded the grounds on which the State Audit Service may include state financial control measures in its work plans, meaning the body will be able to conduct control measures at the request of competent EU bodies, foreign states, and international organizations, as well as where there is information about the improper use of EU resources in Ukraine.

A further outstanding task is the adoption of an effective National Anti-Fraud Strategy for the protection of EU financial interests. The State Audit Service developed a draft last year, but it was ultimately never approved by the government.

Overall, the published financial control criteria came as no surprise — they follow directly from the recommendations previously issued by the European Commission in its Enlargement Report. Ukraine has taken a number of important steps, but meeting the accession criteria will depend not only on decisions being made, but on their full implementation. The immediate priorities are clear: unblock the Accounting Chamber competition, close the gaps in the State Audit Service’s mandate, and continue harmonizing the regulatory framework for the protection of EU financial interests.

This material was made possible with the support of the MATRA program of the Embassy of the Kingdom of the Netherlands in Ukraine. Responsibility for the content lies with the author and does not necessarily reflect the official position of the Embassy.