SMART FINANCE FOR ACCOUNTABLE LOCAL GOVERNANCE

This initiative, launched in August 2025, aims to enhance SDG-focused auditing across the Western Balkans and Moldova, thereby improving public finance management through more efficient and transparent use of public resources. By fostering regional cooperation and knowledge exchange, it promotes collaboration among key institutions, Ministries of Finance, Supreme Audit Institutions, anti-corruption bodies, municipalities and others. 

Given that 69% of the Sustainable Development Goals are to be achieved at the local level, the project also focuses on development of a common approach to SDG auditing tailored to local governments. A key focus of the project is also the introduction of innovative tools and practices to enhance governance, transparency, and accountability in public financial management.

This initiative is aligned with the EU Reform Agenda and contributes to the implementation of the Western Balkans Growth Plan. It will assist candidate and potential candidate countries in complying with EU Chapter 32 (Financial Control) requirements, contributing to the establishment of sound financial governance systems and ensuring adherence to EU standards for transparency, accountability, and financial integrity.

Key Intervention Areas

The project is centered around three main intervention areas:

SDG Auditing

Strengthening capacities for auditing SDG implementation at the local level, with a focus on building auditing frameworks that align with international standards. This will include developing tools for conducting SDG audits at municipal levels, piloting SDG audits, and promoting collaborative knowledge-sharing between auditing institutions in the region.

Corruption Prevention

Addressing the impact of corruption on governance by promoting transparency and integrity in local public procurement and financial management. Activities will focus on proactive corruption risk management, building the capacities of anti-corruption institutions, and fostering regional collaboration through knowledge exchange and the development of practical guidelines on anti-corruption practices.

Innovative Transparency Measures

Enhancing internal controls and auditing systems within local governments by introducing innovative approaches to improve transparency and accountability. This will involve building local capacities for internal audits, exploring AI-based solutions for financial monitoring, and piloting citizen engagement tools for public finance monitoring at the local level.

Partner countries

Albania, Bosnia and Herzegovina, Moldova, Montenegro, North Macedonia, and Serbia

Project Partners

Supreme Audit Office of the Slovak Republic and Ministry of Finance of the Slovak Republic: Providing expertise and best practices in auditing.

Supreme Audit Office of the Slovak Republic and Ministry of Finance of the Slovak Republic: Providing expertise and best practices in auditing.

NALAS (Network of Associations of Local Authorities of South-East Europe): Supporting regional cooperation and knowledge exchange among associations of local governments.

Target Beneficiaries:

  • Supreme Audit Institutions (SAIs): Key to improving auditing standards and capacities for SDG audits.
  • Local Governments: Engaged in piloting SDG audits and improving financial management practices.
  • Anti-Corruption Institutions: Focused on promoting transparency and corruption prevention in local governance.
  • Public Procurement Institutions: Overseeing procurement practices and fostering anti-corruption measures at the local level.
  • Civil Society: Involved in capacity-building efforts and promoting citizen engagement in monitoring local public finance.