2013-05-09
National Audit Office: Lithuanian Radio and Television Centre should manage its assets more effectively
Pursuant to a resolution of the Seimas of the Republic of Lithuania, the National Audit Office has conducted an audit of the performance of the state-owned stock company Lithuanian Radio and Television Centre (Telecentre) over the period 2007–2011, which aimed to assess whether the services pricing procedure is clear, regulated and public, and whether the investment policy of the company corresponds to the goals set for the Telecentre. The auditors also checked how the Telecentre is meeting its obligation to separate the costs of regulated activities and whether it has potential to manage its assets more effectively.
It was found that the company has a functioning cost accounting separation system by the company's business units. The company submits annual sets of accounting separation reports to the Communications Regulatory Authority, which examines these reports and publishes its conclusions.
The auditors found that the provision of the distribution of assets by the company’s business units in the costs separations system of the Telecentre was insufficiently accurate. Cases where established when assets were actually not used in the company's activities, but they were not recognized as unnecessary, inappropriate (impossible) to use or when a property unit was registered in the company’s accounting but was owned by another company, or when part of assets located in the technical buildings were used for activities other than telecommunication activities. Depreciation costs of such assets fall within regulated activities and increase the tariffs of regulated services, but the established amount (LTL 1.2 million) does not have any significant impact on the tariffs of regulated services.
The investment policy of the Telecentre corresponds to the goals defined in the strategic documents. However, the Administration and the Board of the Telecentre failed to use all possibilities to effectively manage the company's assets during the audited period. The company's return on assets ratio, which shows the effectiveness of the use of the company’s total assets, was 1.4 per cent in 2011, meanwhile in 2007 this ratio was 3.3 per cent. Such indicator development tendency shows decline in the company's economic production efficiency.
During the period from 2007 to 2011, the Telecentre used 49 per cent of all investments from borrowed and equity funds for the project of WiMAX mobile broadband internet services. The audit found that the costs of WiMAX mobile broadband internet services were not included in the tariffs of regulated activities.
Decisions on prices of the state-regulated services are approved by the Communications Regulatory Authority, these prices are made available to the public.
The public audit report used information which is considered to be a commercial (industrial) secret according to a decision of the Board of the company, therefore only the Summary part of this report is provided to the public.