The Executive Regulations of the State Audit Law - An Analysis

The State Financial and Administrative Audit Institution (the “Institution”) in the Sultanate of Oman is an independent entity reporting directly to His Majesty the Sultan. It is a governmental institution and has the very critical job of supervising financial and administrative funds belonging to or managed by the State. It is also responsible for protecting public funds, properties and interests by virtue of the State’s Financial and Administrative Audit Institution Law promulgated by RD 111/2011 (the “State Audit Law”) and RD 112/2011 issuing the law on Safeguarding of Public Property and Preventing of Conflict of Interest (the “Law on Public Funds”).

In keeping with the State Audit Law and the Law on Public Funds, the Institution has now issued a Ministerial Decision on 3 April 2013 introducing the new State Audit Executive Regulations (the “Regulations”).


The objective behind issuance of the new Regulations is to provide the Institution with enough freedom and flexibility to perform its main duty, that being the management, supervision and protection of public funds and interests. The Regulations have a clear-cut structure which sets out the various duties, prerogatives and other important matters enabling it to exercise its powers under the State Audit Law.

Prerogatives of the Institution

Members of the Institution through the Regulations have inherited a number of powers and rights in relation to all matters in which public funds are in question such as development plans and privatization and restructuring procedures. Governmental institutions and apparatuses or companies where the government has 40% shareholding will now be subjected to heavy supervision from the Institution in relation to reviewing and following up with accounting and implementation aspects of any public project, governmental grant or any domestic or foreign loans and credit facilities.  Some of these supervisory prerogatives include for example:

• Reviewing implementation of the development projects and achievement of its objectives
• Checking abidance of estimated costs within the set time frame
• Reviewing resource development and cost rationalization

Another important prerogative awarded to the Institution is the authority to expose cases of power abuse, conflict of interest, favouritism, and financial and administrative irregularities, demand accountability, and take necessary measures in this regard. This provision was put forth to include within the ambit of the Institution the ability to ensure transparency, accountability and justice in government performance and in the behaviour of Omani government bodies and officials. The newly issued law therefore expands the Institution’s mandate, allowing it to reach beyond financial domains.

Law Enforcement Powers

The Institution now has in its grasp law enforcement powers provided in the Omani Penal Procedures Law to implement and perform its aforementioned prerogatives. Some of these powers include accessing documents, seizing and documenting evidence and conducting investigations and even conducting arrests and referrals to the Public Prosecution. Furthermore, individuals, firms, experts, technicians or governmental agencies such as the ROP may be enlisted to assist the Institution in carrying out its duties and powers. The new Regulations therefore separate the Institution from any other governmental bodies in its supervision and enforcement capacity under the law.

To ensure avoidance of abuse of powers and prerogatives assigned to the Institution and its members and, in its effort to ensure integrity, justice and transparency, the Institution requires its members to undertake an oath, and its members are subjected to strict financial supervision and numerous prohibitions such as accepting gifts, sitting on boards of public institutions, and disclosing confidential matters.

The Regulations are a step towards State’s intention to bring transparency and accountability to the system.