Financial management

The Government has many different ways of managing the administration, for example through financial- and performance management. These constitute the main parts of the overall financial management. The Government can also use other management tools, such as decisions on how to organise an agency , or by appointment of senior management, or by procedural management, that is through rules that regulate how agencies are supposed to operate.

Financial control

The public authorities' fundamental instrument for financial control is the appropriation and allocation of grants, as well as rules and conditions for grants and contributions, sanctions and borrowing limits. The primary means of financing central government operations is via appropriations, contributions and subsidies.

Performance management

In the Government's management of its agencies, performance management is carried out through instructions (or equivalent), appropriation directions and other decisions. The instruction includes the agency's objectives and tasks, as well as periodic reporting requirements. Where necessary, the appropriation direction sets out annual targets, tasks and reporting requirements.

The agencies report their performance to the Government on an annual basis with regards to the tasks set out in their instructions, and where applicable, the appropriation directions or other decisions. The line ministries and agencies also discuss the achieved results in a government and agency dialogue. With regards to performance management, there are other sources of important and useful information (apart from the agencies’ annual reports), such as particular investigations and/or evaluations of the agencie's performances.

Evaluations of the Central Government operations provide information of how funds are used and what results are achieved. To provide a larger scope for new reforms, it may be necessary to review existing operations. This places demands on information that indicates whether or not the operations lead to the desired changes in society. Evaluations thus provide a basis for developing and improving the Central Government operations.

The agencies can formulate goals for their operations which can be presented in a plan of operations. The follow-up of operations is in general conducted at regular intervals during the year. There are, however, no requirements for the agencies to apply performance management to their internal management of operations.

Agencies' internal management

The Government appoints the agencies' top management. The top management is accountable to the Government for the agency's operations and must ensure that they are conducted effectively and in accordance with the law (according to applicable law and the obligations entailed by membership in the EU), and that the agency makes efficient use of the Central Government funds and reports on this in a reliable and accurate manner.

Agencies are in general directed by a head of an agency, for example a Director General. Some agencies are led by a board of directors or a committee. An agency's top management has considerable latitude to formulate it’s own internal management and goals of the operations based on how it wishes to lead the organisation.

Regulation of the internal management

There are some limitations, however, that the agency’s top management needs to consider and regulations of internal management in different ordinances such as the Government Agency Ordinance (2007:515). The Government Agency Ordinance applies to all administrative agencies under the Government, unless otherwise specified by laws or other ordinances. The courts, for example, are not covered by this ordinance.

Some agencies are required by the Government to conduct internal audits of their operations. This entails more detailed regulations concerning risk-management. These agencies also need to submit an assessment in their annual reports as to whether the internal control is satisfactory or not. However, all agencies must ensure a satisfactory functioning internal control of their operations. 

Internal control

Internal control is the process which ensures with reasonable certainty that an agency fulfils its tasks and goals in accordance with the requirements of the Government Agency Ordinance.

An agency's top management is accountable to the Government for the agency's operations and must ensure these are conducted

• effectively
• in accordance with applicable law and other obligations entailed by Sweden's membership in the European Union
• with a reporting ethic characterised by reliability and accuracy
• with efficient use of central government funds

Central Government internal audit

The Central Government internal audit is the type of auditing conducted in accordance with the Internal Audit Ordinance (2006:1228). The Government tasks certain agencies with establishing internal auditing functions in accordance with the ordinance. The task of internal audit is always documented in the agency's instruction. The Internal Audit Ordinance imposes requirements for an internal audit director to be employed at the agency so that the internal audit can be considered established.

In accordance with the Internal Audit Ordinance, internal audit must be conducted according to both the generally accepted internal audit standards and internal auditors' standards. For further interpretation of generally accepted internal audit and internal auditor standards in the Central Government, guidance can be found in International Standards for the Professional Practice of Internal Auditing.