Supreme Auditor Finds Financial Violations in Academy of Sciences

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The problems in the management of the Bulgarian Academy of Sciences (BAS) become especially visible in procedures for the award and execution of public procurement contracts, the Supreme Auditor said. Incorrect documentation, lack of clarity about the skills and economic status of participants, missed deadlines, unregulated advance payments. These are the most common violations in the auctions organized by BAS. Several bids have been pointed out as downright tragicomic. The Institute of General and Inorganic Chemistry, for example, in a very strange way, decided to buy a combined catalytic system with a microreactor and a mass spectrometer for continuous real-time analysis. No minimum requirements for economic and financial situation of the candidates as well as their technical capabilities have been posed. The performance guarantee is a cash sum, while evaluation criteria are floating. As contractor was selected Astel Ltd., offering a bid worth 261,450 levs without VAT. But the contract was concluded with Hidden Analytical Ltd, which is a manufacturer of the selected equipment but did not participate in the auction. Curiously enough, the Institute has committed itself to pay 100 % in advance

without even asking for a bank guarantee, which actually is working against their own interests. An advance payment was made even before the stated time, while the information about the contract and its performance reached the Public Procurement Agency with a significant delay.

No less spectacular is the tender procedure for the repair of research vessel Akademik organized by the Institute of Oceanology with an estimated value of 460,000 levs without VAT. It placed a requirement for technical capabilities and qualifications but failed to specify through which documents the participants should demonstrate that they meet the requirement. The Commission collected financial records of the participants, without stating what their economic situation was expected to be. The evaluation of bids in terms of technical capabilities and means of implementation was virtual because it was not clear what the best are and which ones – the lowest. Experts of BAS grossly violated the requirements of the tender by only allowing the offered price to be submitted in an envelope, while the remaining documentation was accepted in open files. Since the offers received did not meet the requirements of Art. 57 of the Public Procurement Act, the Commission should have declassed both participants in the procedure, but it did not followed these regulations. As a result of the auction, it awarded a contract with the selected contractor MTG Dolphin AD worth 152,130 euros. The winner had not even submitted a performance guarantee. Dolphin however began to repair the ship. Meanwhile, the Bulgarian Register of Shipping performed an inspection to determine the exact type and extent of repairs and the need for spare parts. Interestingly, there was no answer as to

why this check had not been done before the tender procedure.

As a result of interference from top officials, an annex to the contract the winning company got another 48,618 euro for additional spare parts and equipment. This is another violation of the law. The Academy has other concerns, too, and they are it has serious difficulties to prove that it owns much of the property. The Law on the Bulgarian Academy of Sciences, adopted in 1991 by the National Assembly transferred to BAS the managed by it state land, buildings, machinery, equipment, literature, cash and other movable property. As of early 2013 the academy had 387 items of immovable property, others are held through 266 notary deeds, but for a total of

171 property items there are no documents of ownership. After more than 20 years these problems have long had to be in history. Another thing is that the Academy, generally speaking, was generous in renting its property and premises, but has been very difficult to collect money from tenants. At the end of 2012, BAS had over 1.2 million levs in arrears from tenants while it complains that its budgetary support is small.

All this information came as a result of a check of the Supreme Audit Office.

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