Illegal Procurement in a Mostar-based Ceste

A correction

The Center for Investigative Reporting in Sarajevo (CIN) published an article “Illegal Procurement in Autoceste FBiH” on Aug. 3, 2012, that contained incorrect information about the financial dealings of the Mostar-based public company Autoceste FBiH LLC in 2011.

CIN used information that the Audit Office of the Federation of Bosnia and Herzegovina published in its 2011 audit report of the FBiH and Public Companies Budget and “Selections from Reports on Audits of Public Companies” dated July 27, 2012.

CIN apologizes to Autoceste FBiH LLC and to the readers for the errors on our web page

Following is the corrected news:

The public company Ceste Ltd spent 5.8 million KM in 2011 for procurements not conducted legally, according to an abridged version of the report on audits of public companies conducted by the Audit Office of the Federation of Bosnia and Herzegovina (FBiH). The auditors also found that the company miscalculated employee benefits and failed to pay taxes.

According to the audit reports, Ceste JSC ended 2011 with more than half million KM of losses. Despite this, the firm paid employees 126,500 KM in vacation allowances. According to the Chief Auditor Ibrahim Okanović the allowance was not supposed to be paid because the company was amassing losses.

The report also said that the director approved field work allowances in the amount of 349,722 KM. Auditors found that, in fact, these were travel expenses billed as field work because they cost more.

Also, the auditor’s report reads that the inspectors of FBiH Tax Administration found that Ceste failed to pay around 230,000 KM of taxes last June. The auditors make a point that this should not have happened because the company had secured budget funds to this end.

The auditors also found that the company failed to pay lawsuit damages totaling 172,412 KM. The lawsuits were for damages suffered in traffic accidents blamed on bad tarmac on roads Ceste maintain.

Demant Javnog preduzeća Autoceste d.o.o. Mostar

Published August 3, 2012.

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