On Wednesday, April 1, the Accounting Chamber published a notice that one of its members, Yelyzaveta Pushko-Tsybuliak, had submitted a resignation letter. Under the law, such a resignation cannot take effect immediately — members of the Accounting Chamber are dismissed by parliament. The Accounting Chamber has already resolved to refer the matter to parliament, where it must first be considered by the relevant budget committee before being put to a plenary vote. 

If Pushko-Tsybuliak is dismissed, Ukraine’s supreme financial control body will be left with just four members. Each member is currently responsible for specific areas of work — twelve in total — so yet another departure will mean redistributing her responsibilities among the remaining members, adding to their workload in a way unlikely to improve the institution’s effectiveness.

That said, the Accounting Chamber will not grind to a halt. Under the law, a session is quorate if at least two-thirds of the actually appointed membership is present. After a potential dismissal, decisions could be taken with just three members present and voting.

In practice, this will only deepen what is already a protracted staffing crisis that has persisted for nearly two years. 

The last time new members were selected for the Accounting Chamber was in 2023. Those interviews were publicly broadcast, which gave the public a clear view of the problem’s depth. The competition was purely formal — it included neither a proper assessment of candidates’ professional competence nor any integrity screening. Most candidates had a poor grasp of the Accounting Chamber’s mandate and international auditing standards, significantly overstated their foreign language proficiency, and some openly displayed loyalty to the MPs sitting on the interview panel.

The competition launched alongside the new reform law in December 2024 was meant to fix the staffing problem. The remaining vacancies were to be filled through an updated selection procedure, which provides for a special Advisory Group of Experts (AGE) in which international experts hold a majority voice. Internationally nominated candidates, comprising half the AGE, were put forward as early as spring 2024. The remaining three AGE members were to be nominated by parliamentary factions or groups. MPs have attempted several times to agree on that list, but have failed to hold a vote and formally establish the AGE in nearly a year.

The potential dismissal could further complicate the process of filling vacancies at the Accounting Chamber. Under the law, a competition for a vacated seat must open the day after the member’s term ends. This means that if Pushko-Tsybuliak is dismissed, two competitions would run simultaneously: the first — for the six vacancies opened in December 2024 — and a second for the newly vacated seat. Parliament would then have several options for managing this:

1. The straightforward approach — establish a single AGE to select candidates for all vacant positions. This carries procedural risks, however. The law requires the AGE formation process to restart after a new competition opens. Failing to comply could provide grounds to challenge the results — in the best case, of the second competition alone; in the worst case, of both. The simple option may thus prove the riskiest.
2. The complex approach — run two separate competitions. This would require finally establishing an AGE for the first competition and launching a separate process for the additional vacancy. The timeline could stretch indefinitely, but it would comply fully with the law.
3. The compromise approach — swiftly amend the legislation to allow competition procedures to be consolidated across all Accounting Chamber vacancies, provided they have not yet reached a certain stage — such as AGE formation. This would avoid procedural violations while streamlining and accelerating the appointment of the missing members.

There is also the option of simply refusing to approve the resignation — but this would only delay the inevitable. In practice, someone who wants to leave is unlikely to perform their duties effectively, and the institution is already chronically short-staffed.

It is also important to recognize that filling the Accounting Chamber’s vacancies is not merely a question of the supreme audit institution’s capacity to effectively oversee public spending during wartime with limited fiscal resources. It also bears on Ukraine’s fulfillment of its EU accession commitments and on the confidence of international partners, which directly determines the scale of continued financial support. Completing the Accounting Chamber’s membership by year-end is one of the structural benchmarks under the IMF’s new 2026 program for Ukraine. 

Parliament has every reason to finally resolve the problems of an institution that is, after all, accountable to it. Whether the resignation becomes a deepening of the crisis or a catalyst for resolving it depends entirely on political will. 

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. 

At the end of February, the International Monetary Fund approved a new four-year program for Ukraine. Among the updated structural benchmarks that Ukraine is expected to meet in 2026, one requirement appeared for the first time: to appoint members of the Accounting Chamber to all vacant positions by the end of the year.

Why did the IMF include this point? Because the Accounting Chamber is Ukraine’s supreme audit institution. It oversees the use of budget funds and international financial assistance, as well as the effectiveness of government programs. For Ukraine’s international partners, this is critical: the country is receiving substantial financial support, and independent auditing of expenditures is a key condition for trust.

Yet for almost two years, the Accounting Chamber has been operating with limited capacity, with more than half of its positions vacant—6 out of 11. The situation was supposed to be fixed through a competition launched after the adoption of the new law reforming the institution in December 2024. The updated selection procedure provides for the creation of a special commission—the Advisory Group of Experts (AGE)—with international experts holding the decisive vote in the selection of candidates for appointment to the Accounting Chamber.

However, since June 2025, the Verkhovna Rada failed to vote to establish the AGE. In addition to three international experts, it must include three representatives nominated by parliamentary factions or groups. As a result, parliament has effectively blocked the competition.

The requirement to appoint the missing members of the Accounting Chamber may give parliament an additional push both to establish the AGE and to appoint the candidates it selects. Compliance with structural benchmarks affects future IMF program reviews and the disbursement of further financing tranches. In other words, this is not just an administrative requirement—it could directly affect Ukraine’s continued financing from international partners.

That said, timely compliance with this benchmark may be at risk.

The memorandum states that Ukraine intends to establish the Advisory Group of Experts by the end of April 2026. However, this plan may be complicated by the fact that candidates for the international expert positions in the AGE were submitted almost a year ago, and with the passage of time, their willingness to serve may now be in doubt. If some of them withdraw, a new nomination process could delay the launch of the competition.

Second, the selection of candidates is a lengthy procedure covering several stages:

–       publication of the competition announcement and submission of application documents (at least 30 days)

–       the competitive selection itself, including approval of the procedure, methodology, and selection criteria, testing and interviews, special vetting of candidates, and the formation of the list of recommended candidates (up to 9 months)

–       submission by the Budget Committee of the list of candidates for parliamentary consideration (up to 10 days), followed by a vote, for which no deadline has been set.

So even if the AGE is established without delay, the process of selecting and appointing candidates to the Accounting Chamber could still take more than 10 months, and even longer if delays arise at individual stages.

In addition, one should not discount parliament’s low legislative activity in recent months, as well as the need to reach a compromise among parliamentary factions—both on appointing the experts and later on appointing the members of the Accounting Chamber.

But Ukraine does not have that much time: the structural benchmark on appointing members of the institution must be met by the end of this year.

Therefore, to avoid the negative consequences of failing to meet one of the IMF’s requirements, parliament needs to find a compromise and bring the issue of establishing the Advisory Group of Experts to the floor as soon as possible, to unblock the Accounting Chamber competition.

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.

Did the Accounting Chamber’s audit help resolve problems in supporting the work of the High Anti-Corruption Court?

In 2024, the Accounting Chamber conducted the first audit of the High Anti-Corruption Court (HACC) in five years. The purpose of the audit was to examine the prerequisites for establishing and operating the Court, its performance of its judicial mandate, and to assess the level of financial, material and technical, and human resources support.

Based on the audit results, the Accounting Chamber found that the High Anti-Corruption Court carried out its activities in compliance with legal requirements and ensured the performance of its judicial mandate—despite challenges that affected the timeliness of proceedings, including the COVID-19 pandemic, the introduction of martial law, and instances of abuse of procedural rights by participants in court proceedings.

The audit also found that, despite adequate funding, the Court’s functioning was hampered by both insufficient staffing and the lack of necessary premises.

Following the audit, the Accounting Chamber issued more than a dozen recommendations to the High Anti-Corruption Court and other bodies, including judicial governance authorities, aimed at addressing key problems in the Court’s operations. More than a year has passed since the report was published, so we decided to determine whether the Accounting Chamber’s key recommendations have been implemented and to assess their impact on the work of the High Anti-Corruption Court.

In this year’s EU Enlargement Report on Ukraine, the European Commission for the first time gave a high assessment of Ukraine’s progress in the area of external audit. Much of this was due to the amendments to the Law on the Accounting Chamber adopted at the end of last year. These changes brought national legislation closer to the International Standards for Supreme Audit Institutions (ISSAI) and expanded the Accounting Chamber’s mandate.

Despite the absence of direct criticism, the overall score for the level of legislative alignment in this area remained low — 2 out of 5. However, the Commission rated the actions taken over the past year to achieve this alignment higher — 3 points. 

Transparency International Ukraine analyzed what changes the European Commission expects from Ukraine regarding the Accounting Chamber and the State Audit Service in order to advance within the Association framework.

The competition to fill six vacant positions in the Accounting Chamber formally began last December with the adoption of a law reforming the institution. However, progress has stalled: for four months, the Verkhovna Rada has been unable to form the Advisory Group of Experts (AGE) responsible for selecting candidates. In early September, a new draft resolution establishing the AGE was registered in parliament and may be considered at the nearest plenary session.

The list of candidates nominated by international partners remains unchanged:

–       Igors Ludboržs (Latvia) — former Member and Dean of the European Court of Auditors

–       Pascal Muñier (France) — Honorary Magistrate of the French Court of Auditors

–       Lee Sumerfield (United Kingdom) — Director of Responsive Audit and Investigations at UK National Audit Office.

There are, however, changes to the list of candidates proposed by parliamentary factions and groups. In particular, European Solidarity has nominated a new candidate. Instead of former Accounting Chamber member Iryna Ivanova, the faction proposed Borys Kushniruk.

According to the Budget Committee’s submission, Kushniruk works as an outsourced consultant-analyst. His declared areas of expertise are broad, covering macroeconomics, finance, banking, housing and utilities, the gas market, the pension system, agriculture, and politics. A review of media publications and appearances under his authorship expands this list further — law enforcement, procurement, nuclear energy, freight transport, pharmaceutical pricing, and competition policy in business. At the same time, open sources indicate that he has no professional experience in public financial control (audit).

In July 2023, Kushniruk published a blog post entitled “Our Competitions for Recruitment Are Nothing but Dog Crap!” in which he criticized the use of competition commissions and the very idea of open recruitment for positions in government bodies. Yet two years later, he has changed his stance and agreed to take part in the selection to the AGE.

This inconsistency can also be seen in other topics he actively comments on. In March of this year, Kushniruk published a piece criticizing NABU’s work and citing calls for its liquidation. Yet by August, during a television appearance, he spoke about the need to restore NABU’s procedural independence.

Such contradictions raise doubts about the candidate’s moral integrity, which the law explicitly requires of AGE members.

Overall, the new list of candidates is shorter, as the Holos party did not put forward a nominee. As a result, five candidates remain in the final list.

Alongside Kushniruk, they include:

•     Oleksandr Rozhko — PhD in Economics, Professor at the Department of Finance, Faculty of Economics, Taras Shevchenko National University of Kyiv
•     Myroslava Masliak — Assistant to a Member of Parliament, PhD, Senior Lecturer at the Department of Public Administration, Public Policy and Economic Policy, Semen Kuznets Kharkiv National University of Economics
•     Oleksandr Boiko — Certified Auditor and President of Public Union “Chamber of Auditors and Accountants of Ukraine,” former Deputy Chair of the Audit Chamber of Ukraine
•     Liudmyla Lovinska — PhD in Economics, Head of the Department of Tax Management and Financial Monitoring, Vadym Hetman Kyiv National University of Economics.

TI Ukraine has previously highlighted the risks of appointing Myroslava Masliak to the AGE. While the law does not directly prohibit parliamentary assistants from serving, their involvement creates risks of political or governmental influence over the selection process. This could undermine trust in the competition procedure and negate the very purpose of establishing the AGE — to serve as an independent safeguard against bias and political pressure.

It is also notable that, with the exception of Kushniruk, all other candidates were already considered in the previous vote, which parliament failed to pass. Only six votes were missing to reach a decision. We therefore urge Members of Parliament to weigh the experience and reputation of all candidates carefully and to select the most qualified experts for the Advisory Group.

A vote is expected soon on the composition of the Advisory Group of Experts (AGE), which will be responsible for selecting candidates for the Accounting Chamber. This is part of the new procedure for filling vacant positions in the institution, introduced within the framework of a comprehensive reform of the Accounting Chamber.

To ensure maximum transparency, three international experts will be included in the AGE during the transitional period — the next eight years. The other three seats will be filled by experts nominated by parliamentary factions and groups.

You can read more about the different stages of selecting members of the Accounting Chamber under the new procedure in the full article.

At the end of 2024, a new law on the Accounting Chamber was adopted, launching the reform of this body. One of the most significant innovations was the revised procedure for the competitive selection of the Chamber’s members. 

Previously, members of the Chamber were elected through a purely formal competition that lacked proper verification of candidates’ professional qualifications and did not assess their compliance with integrity standards. In 2023, interviews with potential candidates were broadcast publicly, allowing the public to witness the depth of the problem firsthand. Candidates mostly had limited knowledge about the Accounting Chamber’s powers or international audit standards. They often overestimated their proficiency in foreign languages and occasionally displayed overt allegiance to the MPs who were part of the commission.

Since then, a new transparent and effective competitive procedure has been in development for nearly a year. We explain what it entails and how new members will now be selected and appointed to the Accounting Chamber.

Before the second reading, the draft law considered some of our recommendations on improving the procedure for competitive selection of candidates for members of the Accounting Chamber. In particular, requirements and restrictions in regard to members of the advisory group of experts were added; their rights and obligations were determined; and the openness of meetings and the publication of the methodology for assessing candidates and the results of the selection stages were provided for.

The updated draft law also limits direct interference with the activities of the body: the provisions on the implementation of unscheduled control measures by the Accounting Chamber in accordance with the decisions of the Verkhovna Rada are excluded. However, such important issues as enhancing the political independence of the Accounting Chamber and coordinating its powers with other bodies remained unresolved.

Therefore, Transparency International Ukraine recommends that MPs correct certain shortcomings during the voting for the draft law in the parliament. This provides for supporting the submitted proposals that exclude the provisions of the draft law on reducing the number of members of the Accounting Chamber and the possibility to appoint a deputy secretary of the body and an unlimited number of deputy heads of the Chamber.

 

On October 25, a comparative table was published on the website of the Verkhovna Rada before the second reading of the draft law No. 10044-d, designed to improve the operation of the Accounting Chamber. The document includes more than 1,200 submitted proposals and amendments, as well as the final version of the draft law proposed to the parliament for voting.

The meeting of the budget committee, which considered the proposals and amendments to this legislative initiative, had been held before that, on October 24. According to the results of the discussion, in which, in addition to MPs, representatives of the Ministry of Finance and the Accounting Chamber took part, the parliament was recommended to adopt this draft law as a whole.

Analyzing the text of the draft after the first reading, TI Ukraine recommended eliminating a number of risks before the next vote. They concerned the issues of competitive selection of candidates for the positions of members of the Accounting Chamber, its political independence, and the delineation of powers with other bodies. However, the existing shortcomings were only partially corrected before the second reading.

On October 24, the Parliament’s Budget Committee reviewed draft law No. 10044-d, aimed at improving the work of the Accounting Chamber, for its second reading. As a result, it recommended that parliament adopt the draft law in its entirety. The draft law was also supported by representatives from the Ministry of Finance and the Accounting Chamber who were present.

Recently, the International Monetary Fund identified reforming the Accounting Chamber as one of the structural benchmarks that Ukraine must complete by the end of December 2024. Thus, parliament has just over two months remaining to consider the draft law in the session hall.

In its analysis of the draft law’s text after the first reading, TI Ukraine noted several positive changes aimed at enhancing the Accounting Chamber’s capacity, including the introduction of a risk-oriented approach to audit planning, increased financial support, and improved monitoring of the implementation of the body’s recommendations. However, key issues regarding the competitive selection of candidates for Accounting Chamber members, its political independence, and the separation of powers from other bodies remain unresolved. We have submitted our recommendations to the parliamentarians for their consideration and finalization.

At the meeting, the Budget Committee reviewed over 1,200 proposals and amendments to draft law No. 10044-d submitted by MPs, of which only 19 were considered. These proposals were presented by the committee representatives at the meeting, allowing for familiarization with the changes to the draft law before the second reading.

Some of the changes relate to the establishment of an advisory group of experts for the selection of candidates for positions on the Accounting Chamber and for conducting a competitive selection process. We recommended that the draft law define the requirements for advisory group members, their rights and obligations, and the grounds for early termination of their powers. The proposal to extend the competition period was also taken into account.

To limit interference in the activities of the Accounting Chamber, parliament will remove its authority to make decisions regarding unscheduled audits. Regarding the members of the Accounting Chamber, the draft law will exclude disciplinary offenses or gross neglect of duties as grounds for early dismissal to minimize external impact on them. However, at the committee meeting, no proposals were made to amend the Law “On the Legal Regulation of Martial Law”. Therefore, the risk of early dismissal of Accounting Chamber members due to distrust by Parliament will likely remain.

The issue of the number of members in the body was not addressed during the discussion of proposals for the draft law. In the first reading, it was proposed to reduce the number of members to 11, despite the body’s additional powers. Under these circumstances, after the adoption of the draft law, an additional 6 members will be elected according to the new procedure, as 5 members of the Accounting Chamber have already been appointed.

It is also proposed to expand the powers of the Accounting Chamber to include auditing consolidated financial statements at the state level. This audit will encompass data from key managers of state budget funds, state enterprises, banks, and information on state assets and liabilities. At the same time, the committee rejected the proposal, which aligned with our recommendation to separate the powers of the Accounting Chamber and the NACP regarding the monitoring of the legal and targeted use of funds by political parties.

Before the second reading, parliamentarians also proposed changing the approach to external financial audits to once every three years and conducting external assessments of the Accounting Chamber every three years for the first ten years following the law’s enactment.

The analysis of the changes announced at the committee suggests that the draft law will likely incorporate some of our recommendations aimed at improving the competitive procedure for selecting members of the Accounting Chamber. However, the committee discussions did not address the issue of maintaining the number of members, despite the increase in powers, changes to the procedure for selecting candidates for the head of the body, and the possibility of early dismissal of Accounting Chamber members. This suggests that risks to the body’s political independence persist.

We will continue to monitor the progress of draft law No. 10044-d and will prepare an analysis of the updated text and submitted proposals following their publication.

This publication was created within the framework of the Supporting Digital Transformation project, funded by USAID and UK Dev.

On September 19, the parliament supported draft law No. 10044-d in the first reading, which is designed to reform the Accounting Chamber. The draft law implements roughly half of the body’s capacity-building recommendations that TI Ukraine outlined this summer. It introduces a risk-oriented approach to planning audits, enhances financial security and monitoring of how the body implements recommendations provided to it, and there is also progress in improving the competitive selection of the Chamber’s members.

However, the most essential issues remain completely or partially unresolved:

• competitive selection to the positions of the Chamber’s members still lacks quality and openness;
• political independence of the body has not been ensured;
• the powers of the Accounting Chamber have not been delineated from the powers of the State Audit Service and the National Agency on Corruption Prevention.

These are priority changes that are essential to implement for the effective operation of the body.

***

In December 2023, a working group on reforming the Accounting Chamber was established under the budget committee of the Verkhovna Rada. Representatives of the parliament, the government, the EU, the supreme audit institution of the United States, and experts from the public sector, including TI Ukraine experts, were engaged in it. By May 2024, the group came up with the changes that were to form the basis of the draft of a new law on the Accounting Chamber.

Improving the operation of the Chamber is also a priority for our partners; recommendations on changes were featured in an updated memorandum with the IMF in June, and the adoption of a new law is one of the requirements of the United States to provide direct budget assistance in the amount of USD 1.5 billion.

So far, the idea of creating a new law on the Accounting Chamber has been postponed. MPs plan to amend the current one. Read on to find out more about the key amendments and issues of the draft law.

Improving competitive procedure to select members of the Accounting Chamber

The current procedure is of formal nature and does not allow for a real assessment of the expertise and compliance of candidates with the requirements to members of the Accounting Chamber. The draft law proposes to change the approach to the competition, entrusting the function of selecting candidates to a commission specially established by the parliament—an advisory group of experts (AGE).

It will include 6 persons appointed by the Verkhovna Rada. During the transitional period (the first 8 years after the entry into force of the law), three experts will be delegated based on the proposals of international and foreign organizations, which during the past five years have provided assistance to Ukraine in the field of financial control (audit), corruption prevention, or reform of the Accounting Chamber. Such a period will ensure the participation of international experts in at least one competitive selection cycle of the entire composition of the Accounting Chamber.

In contrast to the current procedure, the draft law proposes to assess candidates’ compliance with the requirements of the specialized law and criteria of integrity and professional competence based on the results of tests, practical tasks, and interviews. Among those who will pass such tests and a special check, the AGE will select at least two candidates for a position of the AC member through an open vote.

The AGE will decide by a majority of votes from the total number of members. During the transitional period, international experts will have the predominant right to vote. In the case of an equal distribution of votes, the decision will be adopted if at least two such experts voted for it.

Subsequently, the list of candidates recommended for appointment will be submitted to the budget committee of the Verkhovna Rada for approval, followed by the parliament’s consideration.

Transparency International Ukraine supports the steps to improve the competitive procedure for selecting members of the Accounting Chamber.

However, the draft law does not consider certain important issues related to the formation of the advisory group of experts (AGE), the powers of its members, and the competitive selection:

• There are no requirements to members of the AGE (for example, regarding their business reputation and work experience) and no restrictions on the election of certain persons to it. There is a risk that a person who does not have sufficient qualifications or who is a representative of a potential entity under the Chamber’s control may become a member of the advisory group.
• The rights and obligations of the AGE members, as well as the grounds for early termination of their powers, are not properly defined. In the future, this may block the competitive procedure.
• The competitive selection shall last 4 months, and this is too short a period to carry out the entire procedure, including the preparatory stage (determining the rules of the group’s work, the procedure for conducting the competition, criteria and methods to evaluate candidates), all selection stages (if necessary, the AGE can conduct additional tests), voting, and formation of the final list of candidates.

Another important risk is that the draft law does not mention that the competition shall be conducted on an open basis. This applies both to general access to participation in the competition and to ensuring the transparency of the selection: publishing the methodology for evaluating candidates, streaming interviews, and posting the results of various selection stages.

Therefore, although the draft law introduces a number of steps to ensure that future competitions are truly effective and open, this transition remains incomplete. The procedure for the competitive selection of new members of the Accounting Chamber and the general approach to it need to be finalized.

Ensuring independence of the Accounting Chamber

Analyzing the work of the Accounting Chamber, TI Ukraine emphasized the need to ensure the independence of this body as a guarantee of its effective operation. The main threats include:

• potential political influence on the institution through the legally enshrined mechanisms of appointing and dismissing its members and the head;
• risks of interference of other authorities in planning the activities of the Chamber;
• financial risks associated with the limited powers of the Chamber in the budget process and the level of wages of employees, which is determined by the general legislation on public service.

The draft law eliminates a significant part of such risks.

When planning audits, the Accounting Chamber will have to apply a risk-oriented approach. Unscheduled audits can be carried out only in case the parliament adopts a relevant decision.

The financial independence of the Accounting Chamber is proposed to be enhanced through obliging the government to provide information on considering the Accounting Chamber’s proposals regarding its financial security together with the draft law on the national budget. The draft law also proposes to remove officials of the Chamber from the scope of the Law on Civil Service and to determine the amount of their official salaries and allowances in the specialized law, as it is provided for the National Anti-Corruption Bureau of Ukraine.

However, not all risks were considered in terms of ensuring the institution’s political independence.

The draft law proposes to reduce the number of members of the Accounting Chamber to 11 and does not provide for depriving previously appointed members of the body of their powers (currently there are 5 of them). This preserves the possibility of political influence on current members, and as a result, on further decisions of the Chamber because they are adopted by a majority of votes from the number of members present at the meeting. Therefore, it is important to maintain the number of members of the Accounting Chamber, which is currently provided by law so that the vast majority of them are elected under the new and open selection procedure.

Currently, the speaker of the parliament is responsible for the selection of a candidate for the position of the Chamber’s head. Thus, the risks of political influence on the potential head of the AC persist. This approach should be changed by providing the Accounting Chamber with an opportunity to elect the candidate and submit a proposal for their appointment to the Verkhovna Rada.

In addition, the draft law retains the risk of early termination of powers of AC members for reasons not provided for by the specialized law.

In May 2022, the Verkhovna Rada adopted a law that gave the parliament the power to express no confidence in officials whose appointment and dismissal is the prerogative of the Verkhovna Rada during the martial law, which results in the dismissal of such an official. At the same time, the issue of expressing no confidence is initiated according to a simplified procedure—it can be done by the speaker of the parliament or at least 113 MPs, and the issue is urgently considered at the plenary session.

As a result, the officials of the Accounting Chamber were at risk of dismissal, and it was due to this mechanism that the former AC head was dismissed. Therefore, the provision of the law, which calls into question the independence of the head and members of the Accounting Chamber, must be excluded.

So far, MPs have settled the risks of interference of other bodies in the activities of the Chamber and enhanced its financial security. However, threats of political influence on its activities persist.

Expanding the Chamber’s powers

Currently, the Accounting Chamber is focused on monitoring the receipt and use of the national budget funds. But the draft law significantly expands its powers and provides an opportunity to conduct audits of:

• local budgets;
• extrabudgetary funds;
• state and municipal enterprises;
• National Bank of Ukraine;
• international financial assistance (grants, loans) received by the national or local budgets;
• public procurement (not only at the expense of the national budget, as is the case now).

Undoubtedly, in conditions of limited use of internal revenues and the attraction of significant amounts of external financial assistance to the budgets of various levels, the role of financial control is increasing. However, such a significant expansion of powers entails risks.

Currently, the Accounting Chamber and the State Audit Service of Ukraine have similar powers in the areas of control over the management and use of public funds. Entrusting the Chamber with additional powers regarding the audit of local budget funds will only increase the number of intersection points in the functions of these bodies. In addition, the simultaneous financing of two bodies with overlapping powers is inefficient in terms of spending public funds on their activities.

Another example is control over the lawful and targeted use of funds by political parties. The NACP is responsible for it; however, the Accounting Chamber retains the same powers under the draft law.

The overlapping in the functions of control bodies needs to be eliminated. In the case of control over the use of funds by political parties, this can be now implemented by introducing relevant changes to the draft law. However, the harmonization of the activities of the Accounting Chamber and the State Audit Service requires additional consultations with the engagement of representatives of these bodies, as well as the parliament and the government. Therefore, considering the short time frame provided to prepare the draft law for the second reading, we recommend postponing the entry into force of the provisions that provide for the expansion of the Chamber’s powers to audit the funds of local budgets at least until the end of 2025.

***

To conclude, draft law No. 10044-d considers most of the issues agreed upon by the working group on the reform of the Accounting Chamber under the budget committee of the Verkhovna Rada. In addition, it fulfills a number of requirements of international partners regarding the reform of the body and partially meets the steps that TI Ukraine recommends implementing for to improve its operation.

However, several proposals need to be finalized:

1. Improve the competitive selection procedure:

• establish requirements to the members of the advisory group of experts (AGE) that will conduct the competition, as well as restrictions on electing certain categories of persons to it;
• determine the rights and obligations of the AGE members, grounds for early termination of their powers;
• extend the term of the competition to determine the list of candidates whom the AGE recommends appointing;
• provide for the openness and transparency of the competitive selection, including the mandatory publication of the candidate evaluation methodology and the results of selection stages.

2. Enhance political independence of the Accounting Chamber:

• preserve the number of members of the Accounting Chamber;
• grant the Accounting Chamber the authority to elect a candidate for the position of head of the body;
• deprive the parliament of the possibility of early terminating the powers of the Chamber’s members on the grounds provided for by the Law on the Legal Regime of Martial Law.

3. Coordinate the powers of the Accounting Chamber with other bodies:

• remove the powers of the Accounting Chamber to control the lawful and targeted use of funds allocated to finance political parties, which currently duplicate the powers of the NACP;
• postpone the entry into force of the provisions that provide for the powers of the Accounting Chamber to audit local budget funds at least until the end of 2025 to harmonize the functions of the Accounting Chamber and the State Audit Service.

These changes are important to reform the body and thus increase the effectiveness of its control over public finances and international financial assistance.

It hasn’t been long since the results of the competition to select candidates for the posts of four members of the Accounting Chamber were announced. It ended with an appointment of new members, despite warnings from the public and international partners. Now, the attention is again focused on this institution.

On March 15, the term of office of seven members of the Accounting Chamber, who were appointed in 2018, expired. Neither they nor the body ceased to be legitimate: the members of the Accounting Chamber continue to exercise their powers until they are dismissed by the Verkhovna Rada.

It would seem that the end of the tenure of most of the Accounting Chamber’s staff is a chance to upgrade the body, not only in terms of quantity but also quality. This means appointing specialists with relevant experience and new approaches to bring the operation of the Accounting Chamber in line with international auditing standards.

Last September, parliament already announced the conditions and deadlines to conduct a competition for the posts of members of the Accounting Chamber, whose term of office expired this March.

In December, the Budget Committee of the Verkhovna Rada met the public halfway and provided streams of interviews with candidates. This is the first and significant step to ensure transparency, which at the same time clearly demonstrated all the deficiencies of the pseudo-competitive procedure, which is quite general and unclear, taking up only one paragraph of the law and negating the principles of competitiveness, objectivity, and impartiality on which the selection should be based. The current approach allows only formally assessing the level of professionalism and compliance of candidates with the requirements provided for members of the Accounting Chamber.

Three months have passed since that selection, but no progress has been made in updating the competitive procedure. The draft of the new Law on the Accounting Chamber, which does not change the current procedure significantly, did not even reach the first reading in parliament.

Both international partners from the G7 and the EU, as well as the public, insisted on reform. Therefore, at the end of last year, a working group was created under the Budget Committee of the Verkhovna Rada of Ukraine to develop a new draft law that would suit all stakeholders. A discussion of proposals that will form the basis of the draft is underway.

Given the current situation, several scenarios of personnel changes in the Accounting Chamber are likely.

Transparency International Ukraine urges the Verkhovna Rada of Ukraine to promptly adopt a new, fair competitive process for appointing members to the Accounting Chamber. Following this, we recommend electing the remaining members along with the chairman without delay.

Despite warnings from both the public and international partners, the Verkhovna Rada proceeded to vote on December 21 to designate four new members to the Accounting Chamber.

The selection procedure was weak, with nearly all candidates unable to adequately demonstrate compliance with the level and requirements of the position during interviews. Therefore, this competition can be considered purely formal, lacking in its primary objective of selecting professional and ethical candidates.

The selection was closely monitored by Ukraine’s international partners. G7 ambassadors cautioned against rushing to new appointments. They insisted on adopting new Accounting Chamber legislation that clearly outline the methodology and criteria for member selection. They also warned that the appointment of officials before the adoption of the law on reform will undermine trust to the Accounting Chamber as an institution responsible for overseeing international aid.

The need to strengthen the independence of the Accounting Chamber was also emphasized by European Commission in its report. They also pointed out that new legislation must be adopted as soon as possible.

A transparent, independent, and competitive selection to the Accounting Chamber with verification of the competence and integrity of candidates is included in the list of priority reforms from the USA.

“Yesterday, the Verkhovna Rada designated individuals to oversee the efficiency of budget expenditures and international aid, chosen through an ineffective and purely formal process. Such actions not only fail to diminish the array of challenges the country faces but also cast doubt on the intention to reform the top audit institution,” remarked TI Ukraine’s Executive Director Andrii Borovyk.

Now the contest continues for another 7 positions of Accounting Chamber members which will become vacant in March 2024. Hence, updating the Accounting Chamber legislation, approving a new selection procedure, and restarting the competition is necessary by that time. We further implore the Chair of the Verkhovna Rada to refrain from nominating a candidate for the Accounting Chamber Chairman’s appointment and to await the selection under the new procedure.

There’s no time to waste in implementing this reform and ensuring the effectiveness of the Accounting Chamber. Otherwise, there will be no effective audit of public funds in Ukraine for the next six years.

 

For reference:

The Accounting Chamber oversees the reception and utilization of state budget funds. The AC is also expected to be a key audit body for the use of international aid funds. The AC comprises 13 members who serve a term of six years upon election.

“We must always reform.” This was the response given by a candidate applying for a position when asked about the necessity for changes in the Accounting Chamber’s operations. This seems to reflect the standpoint of most candidates involved in the competition.

Despite warnings from both the public and international partners, the Verkhovna Rada proceeded to vote on December 21 to designate four new members to the Accounting Chamber.

The primary change in the renewed competition for these roles was the public broadcast of candidate interviews conducted by members of the Parliamentary Budget Committee. This not only ensured its transparency but also helped to highlight the shortcomings of the current competitive selection procedure.

Currently, the entire procedure for the Accounting Chamber member position fits within a single paragraph of the Law “On the Rules of Procedure of the Verkhovna Rada of Ukraine”.

As per the procedure, the Parliamentary Budget Committee reviews candidates’ submitted documents, pre-discusses their compliance with Accounting Chamber member requirements, and presents a decision with individual candidate assessments to the Verkhovna Rada for consideration.

This procedure undermines the established principles of transparency, competition, objectivity, and impartiality that must form the foundation for appointing leaders or members of collective public bodies. Instead, it allows only a formal assessment of professionalism and compliance of candidates with the requirements that are provided for the Accounting Chamber members.

A total of 25 candidates took part in interviews for four positions of the Accounting Chamber members. Despite over half of them having work experience within or related to the Accounting Chamber, and the interview questions being broad, candidates demonstrated an exceptionally low understanding of the body’s powers, organization, and procedural aspects of its functioning.

The most popular reform of the Accounting Chamber, among those announced by the candidates, was the implementation of international audit standards in its operations. But in the end, approximately 80% of candidates could not clearly name those standards or are not familiar with the methodologies adopted and approved by the Accounting Chamber for implementing those standards in daily procedures.

The situation is similar with proficiency in one of the Official Languages of the Council of Europe, a compulsory criterion for candidates applying for positions of Accounting Chamber members. Only a few candidates demonstrated fluency at the interview. Simultaneously, numerous participants in the selection process indicated an inadequate and considerably overestimated proficiency level in a foreign language in their submitted documents. When asked, “Would you like to answer my question in English or not?” one candidate replied, “Or not.”

Testing to screen out candidates lacking adequate knowledge is a widely accepted practice that removes subjective bias from result assessment. However, the existing law does not incorporate this stage into the competition process.

Primarily, the candidates’ inadequate level of training gives rise to another issue: the absence of criteria or methodologies to assess them. They are not provided for by law, and they were not developed and made public before the competition was held. Therefore, the Parliamentary Budget Committee which conducted interviews and must propose as many as 9 candidates to the Parliament for possible appointment, still has room for making unjustified decisions. Also, the involvement of current parliamentary assistants in the competitive selection further raises concerns about potential bias in selecting candidates for the Accounting Chamber.

Another equally significant drawback of competitive selection is the absence of candidate evaluations regarding their alignment with integrity and professional ethics criteria. In the interview, certain candidates sought to display commitment to the commission’s parliamentary members, while some openly expressed readiness to adhere to leadership directives that contradicted their official duties. Moreover, throughout the three days of interviews, the commission members never raised queries about the legality of the origins of candidates’ assets, the consistency of candidates’ or their family members’ living standards with their declared income, or the correspondence between candidates’ lifestyles and their status.

Collectively, these identified issues illustrate that the current pseudo-competitive process falls short in selecting capable, impartial, and ethically sound candidates for positions within the Accounting Chamber.

In a recent report, European Commission experts emphasized the necessity of enhancing the independence of the Accounting Chamber as the foremost audit institution, while G7 ambassadors advised against hastily making new appointments.

In mid-December, a working group operating under the Parliamentary Budget Committee commenced its efforts to reform the Accounting Chamber. RISE Ukraine coalition representatives are the part of the working group. Both the public, members of parliament, and international experts have raised concerns about the inadequacy of the existing competitive procedure for selecting candidates for the Accounting Chamber and have called for a new competition after necessary amendments are made to it.  

We firmly believe that the results of the selection process for the positions of members or Chairman of the Accounting Chamber must be canceled. The announcement of a new selection should only occur after legislative amendments are implemented, guaranteeing an open and transparent competition that assesses candidates for their adherence to criteria of professional competence and integrity.

On December 21, the Verkhovna Rada will vote for the appointment of new members of the Accounting Chamber. Potential officials were interviewed last week. The interviews revealed that candidates’ awareness regarding the body’s functions is largely inadequate, and significant flaws exist within the competition procedure itself. Transparency International Ukraine urges MPs to cancel the current competition and restart it after the adoption of draft laws on the Accounting Chamber reform and the development of a new selection procedure.

Now the competition procedure is weak and formal. Among other flaws, it does not have:

• criteria or general methods for assessing the level of training of candidates;
• a testing stage that would filter out candidates with insufficient knowledge;
• evaluation of candidates for their compliance with the criteria of integrity and professional ethics.

The interviews showed that candidates had limited knowledge about the Accounting Chamber’s authority and international audit standards. They often overestimated their proficiency in foreign languages and occasionally displayed overt allegiance to the MPs who were part of the commission.

This time, the interviews were public domain. What we saw that under the current pseudo-competitive process, it’s impossible to select qualified, independent, and honorable members for the Accounting Chamber.

The Accounting Chamber is a key body for monitoring the efficiency of using public funds. It’s not just Ukrainians who anticipate top-notch and efficient performance from this entity: the European Union emphasizes the necessity to bolster its independence, while ambassadors from the G7 countries advised against hastening new appointments.

In December, the process of revising the legislation governing the Accounting Chamber commenced, and a representative from TI Ukraine is the part of it. The meeting of the Parliamentary Budget Committee discussed the flaws of current competition and the need of holding a new one, among other topics.

It is important to provide for competitive selection based on the principles of transparency, competitiveness, objectivity and impartiality, which will ensure selection of professional and virtuous members of the Accounting Chamber.

We urge the Verkhovna Rada of Ukraine to cancel the competition and announce a new one after amending the Accounting Chamber laws and approving the new competition procedure.