Public Institutions Violate the Law on Audit — Are Citizens Paying the Price for Illegal Operations?

24. September 2025.

Several months after auditors in the Federation of BiH completed the publication of audit reports identifying numerous irregularities in the work of public institutions, some institutions have still failed to respond to the Federal Audit Office regarding actions taken to address these irregularities.

By law, upon receiving an audit report, audited institutions are required to submit their responses to the Audit Office within 60 days, detailing the measures undertaken to correct identified irregularities and deficiencies. However, eight institutions ignored this legal obligation: the Health Insurance Institute of Una-Sana Canton (USK), Public Company “Lokom” d.o.o. Sarajevo, Municipality of Trnovo, Public Utility Company “Visoko” d.o.o. Visoko, “Zrak” d.d. Sarajevo, Brown Coal Mine (RMU) Banovići d.d. Banovići, Public Utility Company “Čistoća” d.o.o. Široki Brijeg, and Municipality of Ravno. For the Health Insurance Institute of USK, the Municipality of Ravno, and the Municipality of Trnovo, this represents a continuation of bad practice, as these institutions had also violated the same obligation during previous financial audits. These eight institutions also ignored formal requests from the Centers for Civic Initiatives (CCI) on the matter, thereby continuing to breach legal provisions and demonstrating irresponsibility toward the system, the public, and citizens.

Audit reports for these eight institutions revealed significant irregularities in operations and public spending, which is why none of them received a clean audit opinion. RMU Banovići, “Zrak” d.d. Sarajevo, and the Municipality of Ravno even received negative opinions, indicating that their financial statements were not presented truthfully and that their operations were not compliant with legal regulations. For the remaining institutions, auditors found, among other things, that public procurement procedures were not carried out in accordance with the law, salary calculations used higher bases than prescribed, hiring practices violated legal provisions, and a series of other shortcomings whose consequences, for now, are borne only by citizens.

This negligent approach to entrusted public funds and the failure to fulfill legal obligations demonstrate the irresponsibility and inconsistency of the management of these institutions in addressing identified problems. Does the law apply equally to everyone, or are some institutional leaders exempt from accountability without consequences? For these reasons, it is crucial that competent authorities, in line with their mandates, respond to these legal violations and examine the accountability of the leaders of the institutions in question.

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CCI is a Bosnian and Herzegovinian, non-governmental, non-profit, and non-partisan organization that encourages and promotes the active participation of citizens in democratic processes and strengthens the capacities of individuals and organizations to address problems in communities across Bosnia and Herzegovina.

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