Posted by Nino Tchelishvili
Until 2015, self-governing cities and municipalities in Georgia were managing their budgets using commercial bank accounts. These arrangements were seen as a proof of the independence of these self-governing entities, which is guaranteed by law. Public Law Entities (PLEs) founded by central or local governments, which were allowed to undertake economic activities and generate their own revenues, also held accounts in commercial banks. Consolidation of financial reports by municipalities and PLEs took place at the Treasury. However, the quality, timeliness and consistency of this information was constantly questioned. The key problem identified was the poor quality - or even absence - of financial management information systems in municipalities and most PLEs.