Feasibility study: Systematic disclosures of EITI data in Mongolia
The EITI International Secretariat has performed the following assessment of routine online disclosures in Mongolia’s extractive sector to examine the country’s readiness to mainstream EITI implementation. The assessment follows the Terms of Reference for a mainstreaming feasibility study and reviews the extent to which there is: (1) routine disclosure of the data required by the EITI Standard in requisite detail, and (2) whether the financial data is subject to credible, independent audit, applying international standards. It is important to emphasize that this study is not a comprehensive assessment of all publicly available information about the sector in Mongolia. Rather, the goal has been to identify any potential gaps that need to be addressed in order to ensure fully mainstreamed disclosures of the data that is required to be disclosed in accordance with the EITI Standard.
The key finding is that most of the information required by the 2016 EITI Standard is routinely disclosed. Most of the “contextual information” is accessible via various government portals – specifically, those of Mineral Resources Authority of Mongolia (MRPAM), the Ministry of Finance, the Glass Accounts, National Statistics Office, Bank of Mongolia, Mongolian Stock Exchange, the EITI Mongolia (EITIM) Data Portal – and select company websites. There have been swift gains in revenue transparency, with daily updated and reliable information available for all transactions to and from the Central Treasury, disaggregated by company, budget level (regional or local) and revenue stream. For transition to mainstreaming, the National Council is recommended to follow the following phases:
(1) Review and revise the scope of reconciliation, with the aim to reduce the number of companies and revenue streams. Upon this revision, EITIM may wish to publish a short reconciliation report for fiscal year 2017 by 31 December 2018. The report would only cover the scope as defined in Recommendation #1, and be limited to focusing on revenue reconciliation; covering all applicable financial requirements of the EITI Standard. The reports should be prepared by an Independent Administrator and follow the relevant procedures as per Requirement 4.9. The National Council may wish to include in the Independent Administrator’s ToRs an assessment of any deviations between company and government disclosures compiled as part of EITI reporting and other publicly-available company and government data.
(2) The National Council should ensure that contextual information of the extractives sector is accessible on, or referenced by, the EITIM Data Portal. This should involve the closer coordination of government open data policy, aligning implementation of government OGP and EITI objectives. Regardless of the channel of online dissemination, the government should ensure that its efforts are properly recognised through coordination under the EITI Standard.
(3) Transition from reliance on an Independent Administrator to full EITI reporting through the eReporting system, once robust quality assurance procedures have been implemented to ensure the reliability of data submitted through eReporting. In the interim, the National Council may wish to continue using an Independent Administrator for a limited reconciliation. The Independent Administrator’s ToRs should be revised to ensure an assessment of discrepancies between company and government data reported through EITI and other publicly-available company and government payment and revenue data.
(4) The EITIM National Council should integrate the EITIM Data Portal into government systems by transferring responsibility for its maintenance to the Ministry of Mines and Heavy Industry, the entity statutorily responsible for collecting extractives companies’ payments data in line with the Minerals Law. Several recommendations must be addressed for full mainstreaming of the EITI Standard to occur.
Additional recommendations and considerations are provided below in this report.
Section 2 provides a background to EITI implementation to date. Section 3 presents the main findings with regards to data availability, comprehensiveness and reliability, including recommendations to be addressed. Annex A provides a detailed list of findings, per EITI Requirement. Annex B provides a proposed timeline for implementing activities. Annex C includes tables justifying the revision of materiality threshold.