Rechnungshof

Purchase of province-guaranteed bonds by the Carinthian Compensation Payment Fund

28.11.2019 - Publication of the joint audit by the Austrian Court of Audit and the Court of Audit of Carinthia 

From March to October 2018, the Austrian Court of Audit (ACA) and the Court of Audit of Carinthia carried out an audit of the agreement on the purchase of province-guaranteed bonds by the Carinthian Compensation Payment Fund (Kärntner Ausgleichszahlungs-Fonds) pursuant to Section 2a of the Financial Market Stability Act (Finanzmarktstabilitätsgesetz). In this context, the provincial parliament of Carinthia addressed an audit request to both the ACA and the Court of Audit of Carinthia. The audit institutions performed the audit jointly in order to prevent a duplication of efforts. The audit aimed at presenting the initial situation and at assessing the development and structure as well as the approval, financing and implementation of the second offer. The auditors furthermore looked into the costs and the remaining economic risks. The audited period essentially spanned the years from 2015 through 2017. 

Further details on this report are provided by the Court of Audit of Carinthia: telephone +43 676 833 32 – 202, office@lrh-ktn.at


Central recommendations

  1. The Carinthian Compensation Payment Fund should step up its efforts in order to attain an adequate premium reduction for the liability insurance of the executive board.
  2. In the interest of encouraging competition and compliance with the principles of economy and efficiency, the Carinthian Compensation Payment Fund should award service contracts only via a public procurement process or after at least three reference offers have been solicited.
  3. As regards the negotiations with the Heta Asset Resolution AG (HETA), the Carinthian Compensation Payment Fund should, against the backdrop of the interim distributions that have in the meanwhile taken place, carry out a legal assessment of a rapid and appropriate write-down and the possibility of withdrawing the HETA securities in order to achieve a subsequent reduction in custodian fees.
  4. The province of Carinthia and the Carinthian Compensation Payment Fund should carry out an analysis of possible further steps of the hold-outs or other creditors, taking into consideration the cost-benefit ratio, or commission suitable lawyers or experts to ensure best possible pre-paredness for such judicial or extrajudicial steps.
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Report: Purchase of Province-Guaranteed Bonds by the Carinthian Compensation Payment Fund

From March to October 2018, the Austrian Court of Audit (ACA) and the Court of Audit of Carinthia carried out an audit of the agreement on the purchase of province-guaranteed bonds by the Carinthian Compensation Payment Fund (Kärntner Ausgleichszahlungs-Fonds) pursuant to Section 2a of the Financial Market Stability Act (Finanzmarktstabilitätsgesetz).

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