The finances of public administration are a complex concept – an auditing partner with extensive competence is an asset
Major changes in the public sector and the prevailing global situation set new challenges for the economy of municipalities and cities as well. The work of the financial department of the City of Hämeenlinna is supported by great co-operation and communications between the organisation’s units as well as external partners, such as auditors.
Jussi Oksa, Chief Financial Officer for the City of Hämeenlinna, praises the work community and atmosphere of the city.
“You can always find support when you need it. You simply need to ask, and the staff of the City of Hämeenlinna always offer help, just like BDO. The answers come quickly and the interaction is direct and straightforward,” says Oksa.
He knows that, while the auditing partner must always be meticulous about independence, audit firms can also offer consulting and expertise for various questions. In terms of the co-operation with BDO, Oksa especially appreciates the organisation’s helpful and effortless approach to services, which makes them easy to use and accessible, no matter the location.
The procurement functions of the City of Hämeenlinna, like those of other municipalities of public administration organisations, are carried out in accordance with the Act on Public Contracts. In his role as CFO, Oksa has witnessed several tendering processes but is not personally involved in the request for tenders for the city’s auditing partner.
“The audit committee of the City of Hämeenlinna works independently. This ensures that the position of the parties under audit is not put at risk,” explains Oksa.
While there have been many tendering processes and the members of the audit committee have changed over the years, BDO has been consistently chosen as the partner for the City of Hämeenlinna for more than 17 years.
“From the client’s perspective, having a partner that knows our organisation and ways of working brings its own value. Most of the co-operation is obviously carried out through our contact person Minna Ainasvuori, but we work with other BDO staff as well.”
Oksa also has experience with BDO’s services related to the work of the group’s board of directors. The client experience has always been straightforward, helpful and professional, regardless of the type of service.
“This stems from people, but I think BDO as a company has also really understood how to do things right. The culture and way of working seems to be passed down from one worker to the next, which reflects BDO’s corporate atmosphere and working culture,” says Oksa.
Oksa also mentions that other people in his team have also praised the interaction with BDO.
A time of hectic events and major changes
The war in Ukraine, industrial action, the update to the strategy of the City of Hämeenlinna and the reforms of the well-being services countries make everyday work quite hectic. There may also be changes in the future co-operation models between operators.
“Auditors will play a major role in the well-being services county reforms, for example. They will need to consider matters related to transfers as well as follow-up tasks,” says Oksa.
“Group-related matters in general, such as fusions and consolidated financial statements, are some of the most challenging aspects of audits, and the auditor plays an important, even instructive role in this regard.”
The preparations of the well-being services counties are keeping Oksa and his team busy this year. It is also important to work on balancing the economy.
“I’ve never experienced such a large number of major projects and changes. This is highly exceptional in the municipal sector. If the decision-makers decided in the future to repeat this process of transferring functions away from the municipalities to the same extent as they are doing now, there would be no more municipalities,” says Oksa.
Structural changes in city operations and corporatisation introduce new types of competence needs
Recently, the corporatisation of city operations has increased the need for expertise.
“Hämeenlinna is the pioneer of the corporatisation of municipalities in Finland. A lot of functions have been sold in recent years. From my perspective, there have been hardly any changes in the content of auditing needs, but the issues seem to be more and more difficult each year; the need for consulting increases and political interest has become more prevalent,” says Oksa.
The auditing processes of corporations and the city are quite similar, but the workload in public administration is usually much larger. The public aspect also brings its own requirements.
The Accounting Act can also complicate matters.
“As the interpretations of the Accounting Act and other accounting regulations can be quite ambiguous, the partner’s internal communications play an important role. In this regard, BDO has always been exemplary by designating a specific expert for a specific matter and always ensuring efficient dialogue.”
Oksa adds that BDO has in-depth understanding of the municipal and public administration sector. BDO also offers various benchmarking opportunities with their solid experience and information on other municipalities and cities.
Consolidated financial statements made easier by changes in operating model
In public administration, the financial statements are often discussed by the board of directors before the audit.
“In my early days working for the city, many financial statements had to be remade because of mistakes found in the audit, which was unfortunate. We decided to take our cue from some of the other operators in revising our process and had the key parts of the audit completed before the release of the financial statements,” says Oksa.
The City of Hämeenlinna made changes to its operating model and required the Group companies to agree on audits for the spring as early as the preceding autumn and to schedule them before the release of the financial statements. This considerably improved the quality of the consolidated financial statements.
“As a new CFO, this was a momentous change and BDO’s help was irreplaceable in the process,” says Oksa.