It is quite common to hear that the bureaucratic actions we encounter are not something the applicant would willingly request or demand, but are instead required by an unnamed 'they'. Quite often, these 'they' are associated with the State Audit Office, which will come and... This could best be explained by the person who built this supreme state audit institution into what we still know it as today.

Recently, it was reported in the media that you are working in Ukraine.

Since November 2020, I have been working in Ukraine on a project funded by the European Union; the EU is supporting the modernisation of Ukraine's State Audit Service (in our sense; in Ukraine, the supreme state audit institution is called Рахункова палата України). I am the project manager, working together with several former colleagues from the State Audit Office of Latvia. International experts in the relevant field also participate in the project, and, of course, local experts from Ukraine. We are a team of 20 people. In practice, I am doing what I once did in Latvia when the Saeima appointed me to the position of Auditor General: building a modern state audit institution that is in keeping with the spirit of the times. Ukraine's supreme audit institution still has a lot to do to meet international standards.

So it can be said that you are building the State Audit Office for the second time in your life, only this time in another country.

That is true! I think my previous work experience is a huge advantage because I know this job from a practical standpoint. My experience differs from that of my colleagues (who are consultants) because I have participated personally in such a process; I have done everything myself and clearly understand what it means. I started my work in Ukraine with a proposed plan – what should be done, how, and in what order. It is not easy, as my Ukrainian colleagues perceive the ongoing changes differently, believing that, for the most part, everything is fine. If someone thinks that 'everything is very good as it is', it is not easy to assess and reassess the situation and the tasks at hand. So far, despite the aforementioned, we have worked well; methodologies have been prepared for all types of audits (financial, compliance, and performance), and a large part of the necessary documentation for the work is in order.

The work (or project) will continue for another year; in the future, we will think more about human resources and their management. For example, in Ukraine, the government has never yet submitted the annual state financial report along with an auditor's opinion, as is accepted in many countries (including here in Latvia).

You mentioned the word 'expert', which has been used relentlessly in Latvia, especially in recent years.

Speaking of the Ukrainian project I am working on, the people brought in within the framework of the project are called experts. They have different categories, and I find the staff (or experts) myself, I interview the candidates, and so on. Since it was and is clear to me that the work must have a visible result, I want to work with people who will be capable of performing this task. I will add that the field of work of the State Audit Office is quite narrow, and even in a large country like Ukraine, finding professionals who have good experience in public sector auditing is not simple. ...at one point, these searches already seemed like an impossible mission to me. Reviewing the requirements, I am now looking for professionals with similar (rather than specific) experience and the ability to quickly acquire new skills and knowledge.

Speaking to your question, I agree – the frequent and indiscriminate use of the word 'expert' has degraded its meaning. Furthermore, the relevant workers may perform their duties quite superficially without really delving into the essence of the issues. I have to face this in my current work as well. For example, when reading assessments made by other organisations, a serious desire often arises to ask the author: 'In preparing and writing this, did you delve into the process you were assessing and read the documents that regulate it?'

Do you happen to collaborate with the State Audit Office of Latvia in your work building the Ukrainian audit institution?

Not too much. As I mentioned, I have involved one or two of my former colleagues in the Ukrainian project; by collaborating, the contacts are, of course, more intense.

If I notice news published by the State Audit Office, I read it and take a look. This July, I organised a study trip to Latvia for four representatives of the Ukrainian State Audit Service. I returned to an environment where I had not been for about 10 years.

Is the State Audit Office, as an institution, always right?

The moment the representatives of the State Audit Office sign off on a document or text they have prepared, that is their truth. But – as is well known – there is no single truth in the world; the question is from what perspective you are looking at the relevant problem.

When an auditor or controller expresses their opinion, they usually recount and explain exactly what they have analysed, what facts they based their work on, what could be recommended to improve or change the situation, etc. The work of the State Audit Office is transparent; anyone can read the explanation of why one conclusion or another was reached. This is very important because we are talking about facts and circumstances that have been established. If not all circumstances are revealed and not all facts are known, conclusions may change when new information emerges. It is important to always remember that we are talking about which facts and what information are being analysed.

How appropriate do you think it is to enquire about potentially compromising material regarding the audited entity before the State Audit Office's audits?

When the State Audit Office draws up its plan – which areas to analyse, which audits to conduct – one must, of course, analyse various information. One can survey public organisations, the non-governmental sector, and find out what they consider important and significant. In my opinion, such a step is correct because one must gather as much information as possible, but, of course, one must first analyse the available information oneself.

I will emphasise – the conclusion must be clearly understandable and well-founded. It cannot happen like this: 'someone told me something bad about institution X, so I will go and audit it'. The justification for why an audit is being conducted must be based on a very large volume of information – why we will check exactly these things out of the relevant volume of resources, or why we will evaluate exactly these things out of a large number of functions.

Back in the day, we introduced such a practice so that auditors would not engage in very narrow areas, but would first thoroughly analyse the sector or institution or function and understand what is most essential, most topical for the public, etc.

Information can be collected in various ways, but the decision must be clearly and understandably justified so that it is clear to everyone why the decision was made to audit a specific area or institution.

Is the audit performed by the State Audit Office checked by anyone?

The State Audit Office is checked in two ways, which is customary in international practice and set out in international standards. First, the annual financial statement of the State Audit Office is checked by a sworn auditor chosen by parliament through a competitive process; second, supreme state audit institutions are checked by the supreme audit institutions of other countries. As far as I know, the State Audit Office of Latvia was checked in this way this year.

I remember one of your first interviews on Latvian Television well, where you said that Latvian laws do not prevent the inefficient and wasteful use of public funds. Haven't you ever wanted to calculate how much money has been wastefully spent in Latvia during the years of independence (from the perspective of the State Audit Office)? Could such information be compiled?

If that were to be done, the State Audit Office would have to perform this task professionally. There are various methods by which this could be done, but to justify a specific sum of money wastefully spent, certain audit procedures must be carried out, and a serious analysis must be conducted. If the State Audit Office concludes in its audit that funds have not been used effectively or rationally, the State Audit Office prepares recommendations, which are implemented over a certain period, subsequently calculating how the situation has changed in the respective institution over time – how much has been saved, how many services have been provided, and how much income has been generated.

In general, I think it is doubtful that anyone will state or calculate the figure (sum) you asked about; I allow that someone could occupy themselves with it, but, in my opinion, answering such a question is quite impossible.

The State Audit Office uses the words 'recommendations' or 'suggestions' in the public space. A suggestion is a choice; in what the State Audit Office says, it sounds like an order to act, which is subsequently checked. How is it really?

Suggestions, or recommendations, require a procedure through which the results of an audit are coordinated – agreed upon with the audited institution, discussing what should be changed and what should be improved. Moreover, there is also an agreement on the next steps; for example, the State Audit Office says 'the control environment must be improved' – and it is then the responsibility of the institution how it will act to resolve the relevant issue. That is the institution's decision; the State Audit Office does not decide it!

So, if I understand correctly, an agreement on changes or improvements is for some reason called a recommendation.

That might be in legal language – you identify, you conclude, and you recommend what to do. This word is used.

In my opinion, it is more reasonable to change the situation even before mistakes have arisen.

A problem of recent years – is the obvious increase in various requirements and rules. Speaking of specific issues and analysing requirements, for example, regarding non-governmental organisations, we hear the explanation from institution staff: 'We would willingly not ask you for this or that, but the State Audit Office will come, audit, and then we will be in a tight spot.' Requirements are growing, their meaning is being lost.

I heard such stories back when I was in the position of Auditor General. At that time, they tended to say it not about the entire State Audit Office, but that 'look, Inguna Sudraba has decreed this and that and will ask for this and that in the audit'. Or, for example, that I personally would come to audit and then the respective institution would really get what for!

So this is nothing new to you?

I explain it simply: every institution must first look at itself and clarify what 'rules of the game' it has prepared and written, for example, regarding the execution of work, what requirements it puts forward, for example, in working with NGOs, etc.

The work of the State Audit Office is to check the rules that civil servants have prepared and adopted, and to compare them with practical life. For example, 'the rules state what a report on work done should be like, but you ask for and accept something different.' If the question is about procedures that do not work in practice, they need to be changed. This can be done if you see that in real work everything happens more effectively and sensibly than written in the instructions – in short – adjust the instructions to life or vice versa.

If, on the other hand, not everything written in the rules is being requested, one must say – either operate according to the rules you yourselves have invented, or change them as quickly as possible!

Employees of the State Audit Office do not invent or compose rules for the units being audited; they are already written, for example, in the form of laws, Cabinet Regulations, or the internal regulations of institutions, or work procedures. As I mentioned, during audits we tend to look at and evaluate how the approved rules work in life. I know that in overly bureaucratised situations, auditors recommend changing the established order; for example, it is not necessary to ask for something twice or to set as mandatory information that is not used or not necessary.

Recommendations also tend to be like this – 'the institution should abandon what is not necessary for it'.

So – if a state institution acts seemingly bureaucratically, the questions should first be asked to this institution (its staff), not the State Audit Office.

Exactly!

Have you ever tried to change anything in this regard, because neither you nor your successors in office should have to listen to the undeserved reproaches we spoke about earlier.

My answer has not changed – ask the institution whose employees say that we (the State Audit Office) will come and definitely check something. I invite you to ask: 'Why have you invented such rules? What do you want to achieve with them?' The auditor does not invent the rules according to which some policy should be implemented, money granted, or reports requested. The auditor's duty is to evaluate whether the system is operating according to the rules of the game and then, by evaluating deeper and more thoroughly, to enquire whether these rules of the game are sufficiently effective and useful.

Quite often we hear about the State Audit Office's audits – 'the auditors could not or were unable to verify this or that...' Usually, this is understood as the fact that documents or an explanation are missing; less often is the competence of the State Audit Office representative meant. It can, after all, happen that an auditor is unable to verify something because they lack knowledge in the relevant area.

Before auditors begin an audit, they identify the scope of the work to be done, the necessary knowledge, etc. – this is a mandatory condition. There must be complete clarity as to whether the team that will perform the audit has the necessary competencies and knowledge. If skills or abilities to perform the work are lacking, it cannot be performed. When I managed the State Audit Office, for the performance of more complex and voluminous audits, we first prepared a plan, understood the scope, and determined where our knowledge might be lacking. We engaged specialists in various fields (the word 'expert' would be used again here), who helped us with their knowledge. How does it happen? We gave the person knowledgeable in the sector or field specific questions that had to be analysed, providing their conclusion.

A situation where an auditor writes that they cannot verify one issue or another because they lack knowledge, but has not consulted a specialist, is not acceptable!

It has often happened that representatives of the State Audit Office, when informing about an audit performed, use loud words, strong phrases, which make one think that 'the audited institution has made a big mess'. Reading the audit documents, I have had to conclude more than once that there is nothing loud and colourful to describe there. Does it befit a state institution that, as you said earlier, works based on facts and documents, to shout loudly?

I will not comment on my former colleagues or my former workplace.

Everyone has their own work methods; I focus only on the work to be done, and if the results of my work are noticed and appreciated, it satisfies me. It is important to me that I perform my work as honestly, competently, and effectively as possible, and that we achieve greater public trust in state institutions and their actions with the resources available to us or at my disposal.

Often in life, one happens to compare what a person devotes more time to – their work or their publicity; that is everyone's personal decision. For me, public relations are more of a burden than a gain.

How to evaluate the efficiency or effectiveness of an institution's work in the long term if it is seen that such a ('big') plan is lacking at the state (Saeima, government) level?

The biggest difficulty, both in the country as a whole and in the creation of separate plans or policies, is to see and define specific, far-reaching goals and consistently implement them. Unfortunately, politics in Latvia has for years been created in the short term (for example, from election to election) and is sufficiently populist. People easily believe in populism or easily obtainable money, without thinking about the consequences.

It is much easier for auditors to evaluate the usefulness of a process or expenditure if specific goals are already included in policy; for example, if you see criteria, goals, and what has been achieved, comparing is simple enough – say, will the chosen path lead to the achievement of the goals, and are the chosen resources being used rationally? In Latvia, it is rarely clear anywhere and rarely clear when; for example, if goals are defined, the results to be achieved are not defined, and it is not clear how and when the goal will be considered achieved. The auditor's work is to look for and find criteria and principles, comparing with world experience. Back in the day, we evaluated Latvia's science policy in this way; I personally went on a very intensive one-day work visit to Finland for this purpose and met with the heads of many institutions to find out the mechanisms and the system for how science policy management takes place in Finland. That was necessary to create a benchmark for comparison. At that time in Latvia, there were no measurable indicators.

It is known that the 'cheating' criticised in schools back in the day was valuable in the eyes of some teachers or university professors: 'you wrote a cheat sheet, you read the topic, you learned something yourself.' In Latvia, it is customary to praise the experience, policy, or results of a neighbouring country or another country. Why break your head – 'let's take from the Finns or the Estonians'? Why is it talked about, praised, envied, but 'cheating' at the state level does not happen even in sectors where people have been talking about reforms for many years? It seems one of the most unpleasant side effects of the war started by Russia in Latvia was and is the realisation that much does not work, does not happen, and has not been done...

I will speak only about my own experience. Upon becoming Auditor General, it was clear to me what institution I was starting work in, which is why I emphasised that the State Audit Office under my leadership would become a modern and effective institution. Of course, I looked for all possible support and experience that was available at that time. We worked intensively with similar control institutions in Great Britain and the Netherlands; among the first to come to me were the employees of the Latvian representation of Ernst&Young, who became involved in staff training. I sought various opportunities, collected as much information as possible, and from all that, we extracted what was most appropriate and suitable for us.

In Latvia, there is no demand for specific goals at the state level. For example, if a specific person or party claims a seat in parliament or government, the first question is – what do they want to achieve, what is their goal? Often the goal is achieved when a person has 'sat in a specific chair' until the next election. There is a lack of courage to decide in a far-reaching way and to take responsibility for the decisions taken.

What is our country associated with? A land that sings, okay... Anything else?

I remember what I experienced in the 90s when I worked at the Ministry of Finance. Once I participated in a meeting of ministry representatives in Tallinn, where several politicians spoke, mentioning reforms (as in the 90s). The Estonian colleagues at that time had included in all their presentations the idea – 'Estonia is an IT country'. We, the Latvian representatives, were still talking among ourselves – what kind of IT country will that be, because our neighbour's colleagues sounded like they were thinking about a very distant future.

What is Estonia doing and what is happening there now? We see what has been achieved. Information technology is one of the first associations when speaking about our neighbour – since the 90s, they have purposefully invested in education, business opportunities, development, and the creation of an environment where IT is widely used. Speaking with colleagues from other countries, I often hear that they have hired Estonian companies or specialists specifically to solve IT issues. Therefore, our neighbours set a goal that was forward-looking and long-term, worked on creating a constant, stable environment, and we see the results. It is a great support for people, for the economy, for the image of the country, and also for trust in state representatives, because the work is done qualitatively.

In Latvia, the slogans have been various, but how to create an environment where people would want to live, work, create... That has remained in the background.

You have worked in a bank for a while. Has no one invited you to work in the private sector, or have you not wanted to yourself?

Every experience is valuable. I worked in the private sector for a short time, a year and a half. It was a good opportunity to see public administration from the outside. I saw how little they know and understand in the private sector about what is happening in public administration. Unfortunately, from the outside, I also saw unpleasant scenes about what is happening in public administration. I concluded that a good impression of public administration has not been formed here; often, people have had a bad experience once or twice, and they apply this experience to the entire public administration, which is understandable but not fair.

What did I understand in that year and a half? Sales is not my field. Often, while working in the bank, I had a greater desire to dissuade people from taking a loan than to persuade them and explain that it was necessary and beneficial for them.

Even before the C19 period, at the state and political level, a sneering attitude appeared towards those who want to work. There is no money... The state cannot without money... But we will limit you and your desire to work and earn anyway.

Of course, the state cannot without money. The first job, in my opinion (I have repeated this often enough, and also mentioned it in our conversation), is to create an environment where people want to build their business. The more there are such people who are able to take care of themselves, the less of a burden it is for the state, and accordingly, more funds remain for those who are no longer able to take care of themselves.

Why is it so very hard to create such an environment? Why is it complicated to find, for example, a slogan – 'here is a country where everyone has the opportunity to work and create their own business'? ... It is hard to say; conversations and decisions, unfortunately, take place in that niche or level that relates to that voter who stands and says – 'It is necessary to take care of me, and that is the duty of others, not my own!' I feel that thinking is slowly moving in that direction, where the belief reigns – 'someone else is responsible for my life...' I will repeat myself, but it is very important that state leaders create an environment where everyone can develop their business.

The European Green Deal is undeniably a good idea, but... again, much is happening at the level of slogans. As soon as you delve into it, you encounter a huge volume of documents. Are good ideas not sinking at the European level as well in the ballast of interests surrounding these ideas?

You answered your own question... If a person wants to achieve something, they create such a path so that it can be done. If it is only false and superficial (in words), opportunities are sought how to exert less effort; for example, to create such an environment and conditions so that everyone who wants to start something immediately understands that it is better to do nothing.

Working in Ukraine, which we talked about at the beginning of our conversation, I see well – there, too, bureaucracy has proliferated lushly. The typical environment I encounter daily – explanations why something cannot be done, what is hindering, what is an obstacle, what is wrong. Much more time is spent on excuses – why not do it, rather than on the removal of hindrances and real work.

You are also talking about Latvia...

If everyone hand-in-hand were interested in the result, probably the organisation of work would be different. Piles of prepared paper are not and cannot be a result.

Do you think that in Latvia people are waiting for phrases, not real deeds?

I do not listen to people about whom it is clear that they have no basis to express themselves on one issue or another – there are phrases, there are quotes, there are skills to deftly wag one's tongue. Moreover, if the listener of all this is not very well-oriented in the issue being examined, they may get the impression that the speaker is very knowledgeable and clever; if a person knows the issue sufficiently well, it quickly becomes clear that words are being strung together without understanding the topic they are talking about.

If that is the demand – to listen to babbling and empty talk – it is given content accordingly. Also in Latvia, there are enough people who can express themselves in this regard. I, for example, am interested in filled time and the opportunity to see the result of what I do.
Photographs of Inguna Sudraba and zemeunvalsts.lv used