The scandal that arose due to the results of the inspection by the State Audit Service of the activities of the KP “Kyivteploenergo” may put an end to the issue of the effectiveness of the management of the heat and power complex of the capital. Currently, the management of this enterprise, under far-fetched pretexts, hides information about the results of the audit and even tries to challenge the actions of the auditors in court. The capital’s “power engineers” talk about the destruction of a number of their documents as a result of a missile attack and refer to martial law, although the check concerned the period from January 1, 2018 to June 30, 2021. Such actions of the heat supply company are clearly aimed at avoiding responsibility for the identified violations, since law enforcement officers became interested in the materials of the state audit – the Bureau of Economic Security (BEB) has already conducted a search in the KP. The consequence of these processes was the impossibility to find out exactly what violations in the work of “Kyivteploenergo” were found by the state “auditors” and what losses as a result of this the community of the capital suffered.
As became known KVthe leadership of the Kyivteploenergo metropolitan enterprise is currently taking steps to hide data on the inefficient activities of the enterprise in 2018-2021 and evade liability for financial violations.
Currently, the company is trying to legally recognize the actions of the State Audit Service as illegal, which carried out a state financial audit of the activities of Kyivteploenergo and an audit of certain issues of the financial and economic activities of this enterprise for the period from January 1, 2018 to June 30, 2021. On February 2, 2023, the Kyiv District Administrative Court (KOAS) opened proceedings on the relevant claim of Kyivteploenergo. Such actions of this heat supply company are obviously aimed, among other things, at “protecting themselves” from “excessive attention of law enforcement officers”. The fact is that, based on the results of an audit by the State Audit Service, criminal proceedings were opened, within which, on February 23, 2023, detectives of the Territorial Directorate of the BEB in Kyiv and the Kiev region began searches at the head office of KP “Kyivteploenergo”.
As of today, there is no information in open sources about what kind of violations in the work of KP “Kyivteploenergo” were found by state auditors and what losses the community of Kyiv suffered as a result. The parties to this conflict are in no hurry to publish data.
So, in the Department of Housing and Communal Infrastructure of the Kyiv City State Administration (LCK KSCA), to which the KP “Kyivteploenergo” is subordinated, refused respond to CB’s request regarding the circumstances of the aforementioned audit. The officials explained this by the fact that they are not the managers of the relevant information, so the request was sent to Kyivteploenergo for consideration.
However, the management of this enterprise also decided do not provide no data, because … under martial law, “the requested information is classified as information with restricted access”, because KP “Kyivteploenergo” is an operator that “manages critical infrastructure facilities and is responsible for their current functioning” “. At the same time, Kyivteploenergo noted that the company also cannot provide KV with copies of the aforementioned lawsuit, because “the provisions of the Law of Ukraine “On Access to Public Information” do not apply to citizens’ access to procedural documents created in the course of judicial proceedings.”
In turn, the State Audit Service, from which CI also asked for copies of documents on the verification of KP “Kyivteploenergo”, reported about the impossibility of providing such information for another reason. In their response, the auditors noted that as a result of these financial control measures, criminal proceedings were opened, therefore, the materials of this audit actually contain information from a pre-trial investigation, the disclosure of which is prohibited by the Criminal Procedure Code of Ukraine. However, the State Audit Service provided the editors of KV copies claim of KP “Kyivteploenergo” and its recall on him, and these documents at least a little “open the curtain” on this story.
How was the audit
The claim and the response to it indicate that during the II-IV quarters of 2021, the State Audit Service carried out a state financial audit of the activities of the Kyivteploenergo KP for the period from January 1, 2018 to June 30, 2021. As part of this audit, the auditors also conducted an audit of certain issues of the financial and economic activities of the specified enterprise (it lasted from December 16, 2021 to January 31, 2022) for the same period.
As it turned out, the management of KP “Kyivteploenergo” tried in every possible way to prevent the implementation of such measures of financial control. In particular, on January 21, 2022, the company’s lawyer objected in writing to the State Audit Service about conducting the said audit. Like, her program does not specify a specific list of issues that the auditors plan to study, and it was not indicated whether this program was agreed with law enforcement agencies, as required by law. In addition, on January 25 and 31, 2022, Kyivteploenergo KP did not allow auditors to enter its territory to conduct an audit, in connection with which the State Audit Service applied to the National Police on the facts of “obstructing employees of the state financial control body in the performance of their duties” .
However, the auditors did what they planned. On February 4 and February 11, 2022, the State Audit Service sent an audit report and a draft audit report to Kyivteploenergo. According to the law, the KP could provide its comments and objections to these documents – they were given a period until March 1 and March 10, 2022, respectively. Kyivteploenergo submitted its partial objections to the audit report on February 22 last year, but did not provide comments on the audit report of the energy industry within a certain period of time.
On April 22, 2022, that is, already after the specified “deadline”, Kyivteploenergo sent two letters to the State Audit Service – “On providing comments on the draft audit report” (this letter is dated March 10, that is, the last day when the KP could do this. – KV) and “On the impossibility of presenting objections and documents as a result of martial law” (letter dated March 14).
According to these letters, KP Kyivteploenergo informed the State Audit Service that the enterprise cannot “exercise its right to send additional objections to the audit report and comments to the draft audit report through martial law in Ukraine”, which was introduced on February 24, 2022. At the same time, the “power engineers” reported that they did not agree with the conclusions of the auditors, but they would justify their disagreement after the end of martial law – they say, the Law of Ukraine “On protecting the interests of subjects of reporting and other documents during the validity period” allows to “postpone” the submission of comments. martial law or state of war”, which entered into force on March 7, 2022.
However, Kievteploenergo did not wait for the “end of the war”, and during May-June 2022, the company sent two letters to the auditors with additional comments and objections to the above-mentioned audit report. According to the State Audit Service, as a result of consideration of all letters from KP Kyivteploenergo, they took into account objections in the amount of UAH 217.9 million, which was reflected in the audit report. That is, the total amount of violations and deficiencies identified was reduced by the specified amount.
Later, on December 5, 2022, the State Audit Service compiled and signed the “Report on the results of the state financial audit of KP Kyivteploenergo”. After that, on December 5 and December 7, 2022, the auditors sent two written requests to the specified enterprise – to provide information on the implementation of proposals and recommendations provided based on the results of the audit report, as well as on the elimination of violations identified during the audit.
On December 7, 2022, Kyivteploenergo sent a letter to the State Audit Service “On the impossibility of providing documents during martial law” (obviously, the letter was prepared to receive the above letters from auditors. – KV). In this appeal, the “power engineers” reported that in October 2022, as a result of a missile strike, one of their premises was destroyed, where the archive was located, which stored the original documents on the financial and economic activities of the enterprise for 2018-2021, including those which is the subject of an audit study.
On December 16, 2022, KP “Kyivteploenergo” sent the above-mentioned claim to the KOAS to recognize as illegal and cancel the two above-mentioned requirements of the State Audit Service dated December 5 and 7, 2022, as well as the actions of auditors to draw up and sign a report dated December 5, 2022 and carry out its act dated 5 February 2022. The company actually explained its requirements by the fact that the auditors “should have waited” until the power engineers sent their explanations regarding the audit and revision before signing the final results.
In addition, on its official website, Kyivteploenergo reported that “the conclusions of the audit of the activities of the KP are unfounded, and they are based not on an analysis of documentation or actual work, but on subjective assessments that are not documented, in particular, taken from media sources” .
The State Audit Service does not agree with such claims of Kyivteploenergo. In particular, the auditors noted the fact that during 2022 the capital’s “energy” had the opportunity to provide comments on the draft audit report. This, they say, is evidenced by the fact that Kyivteploenergo, despite martial law, submitted reports on its activities to the Kyiv City State Administration (in particular, a report on the implementation of the financial plan for the first half of last year). The auditors also drew attention to the fact that there were no hostilities on the territory of Kyiv during the specified period that would make it impossible to provide explanations within the framework of the audit.
During December 2022 – February 2023, the State Audit Service sent the audit and audit materials to law enforcement agencies. And these documents were involved in criminal proceedings, which had already been investigated by that time.
We are talking about criminal proceedings no. What article of the Criminal Code (CC) of Ukraine is being investigated in the first proceedings, the auditors did not specify in their response, and the second proceedings are being investigated on the fact of a criminal offense under Part 5 of Art. 191 of the Criminal Code – misappropriation, embezzlement or seizure of property by abuse of official position, committed on an especially large scale or by an organized group.
Within the framework of which of these productions BEB conducted searches at Kyivteploenergo, there is no information in open sources. Such actions were committed as part of another investigation, which the auditors did not report for unknown reasons.
How Kyivteploenergo works
KP “Kyivteploenergo” de facto was created by the Kyiv City Council back in 2006, but this enterprise began to supply the residents of the capital with heat and hot water only in 2018. Prior to this, this was done by Kyivenergo OJSC, the company of billionaire Rinat Akhmetov. During its short history, the KP has managed to become one of the most scandalous managers of Kyiv’s budget funds.
So, at the time of its creation, the authorized capital of KP “Kyivteploenergo” amounted to only 5 thousand hryvnias. In March 2018, the City Council increased it by UAH 1.2 billion, and in September 2018 another UAH 800 million was added to this enterprise. In March 2019, the city authorities increased the authorized capital of Kyivteploenergo by UAH 300 million, and in October 2021 by another UAH 2 billion.
Note that in open sources, the last “adjustment” for some reason is not taken into account – for example, in the analytical system You control and database opendatabot it is reported that the authorized capital of KP “Kyivteploenergo” is equal to 2.3 billion hryvnia, as it was as of the year before last. It can be assumed that either Kyivteploenergo did not receive the budget funds promised by the city council, or due to martial law, not all information on the financial condition of critical infrastructure enterprises is published in the public domain.
All these and other financial resources allocated by the city authorities were intended for the development of the enterprise, solving urgent issues in the areas of heat generation and heat supply, as well as preventing an increase in heat tariffs for residents of the capital. But whether the budgetary funds were spent for their intended purpose and whether such financial injections had a significant effect on the city’s community remains a question.
So, in June 2018, the deputy of the Kyiv City Council Konstantin Bogatov (then he was a member of the Self-Help Association faction, he was elected to the current IX convocation of the City Council from Golos, but now he is non-factional) indignant the fact that the city authorities do not even show the deputies the balance of income and expenses of Kyivteploenergo. At the same time, Bogatov drew attention to the fact that the company bought cream for almost 2 million hryvnias, coffee machines for 10 thousand hryvnias apiece, and shoeshine machines.
In the fall of 2021, it became known that KP Kyivteploenergo annually spends hundreds of millions of hryvnias on the repair and modernization of the city’s heating networks, but their condition has not improved at all since 2018 (it was noted that at that time 80% of the networks were in critical condition). At the time, the Verkhovna Rada suggested that there was simply a manipulation with indicators in order to “eternally” write off significant budget funds for an item of expenditure without evaluating the effectiveness of investments.
Despite such scandals, the city’s leadership is not going to abandon its practice of “pumping” this enterprise with budgetary funds. For example, in February 2023, the Kyiv City Council approved the City Heat Supply Scheme for the period until 2030, in accordance with which it allowed Kyivteploenergo to use about UAH 115.3 billion in the coming years from various sources (city budget, loans, etc.) for the modernization of thermal energy generation systems. and its transportation. At the same time, during the discussion of this document in the session hall of the Kyiv City Council, the officials of the Kyiv City State Administration admitted that it was developed even before the full-scale war and requires “updating in accordance with the requirements of the time”, but officials will be engaged in its “updating”, they say, “after the victory” .
KP “Kyivteploenergo” since December 22, 2018 manages Vyacheslav Bind (in the collage on the right). This enterprise, as noted above, is subordinate to the Department of Housing and Public Utilities of the Kyiv City State Administration, which since July 17, 2017 has been headed by the aforementioned Dmitry Naumenko. Since 2014, the housing and communal services sector in Kyiv has been controlled by the Deputy Chairman of the Kyiv City State Administration Petr Panteleev (in the collage on the left).
Since November 8, 2022, the post of Chairman of the State Audit Service of Ukraine has been Galina Basalaeva. The activities of this body are directed and coordinated by the Cabinet of Ministers of Ukraine through the Minister of Finance of Ukraine, whose position has been held by Serhiy Marchenko since March 30, 2020.
It should be noted that from April 30, 2020 to November 4, 2022, during the inspection of Kyivteploenergo, the State Audit Service was headed by Gennady Plis. He is not a stranger to the city authorities: from 2006 to 2017, Plis worked in various senior positions in the KSCA. In particular, in 2014-2016 he headed the Department of Internal Financial Control and Audit of the Kyiv City State Administration, and in 2016-2017 he served as First Deputy Chairman of the Capital City State Administration Vitali Klitschko.
Obviously, Gennady Plis knew where to look for violations in the work of communal power engineers.
After his dismissal from the State Audit Service, on December 30, 2022, on behalf of the Verkhovna Rada, Gennadiy Plis became a member of the Accounts Chamber of Ukraine, a body subordinate to the Parliament that reviews the draft state budget and analyzes its implementation.
Ivan Kulik, translation Skeleton.Info