Two Bills passed the first reading
A bill updating the professional practice of internal auditors and a bill on amendments to the State Assets Act regulating the work of state-owned enterprises passed their first reading at today's sitting of the Riigikogu.
The main objective of the Bill on Amendments to the Government of the Republic Act and Amendments to Other Acts arising therefrom (766 SE), initiated by the Government, is to update and streamline the professional practice of internal auditors. To this end, the requirement to hold the profession of internal auditor when working as an internal auditor in an authority of executive power will be repealed. As a result of an amendment, the signatory of an internal auditor’s report in such an institution will not need to have a relevant profession.
The bill will remove the requirements that provide for the obligation for internal auditors to hold certificates that are not issued in Estonia or in the Estonian language. The separate recognition of certificates, registration of the profession in the register of Auditors Activities Register and annual reporting by internal auditors on the volume of work and completed continuing trainings will be discontinued.
In the future, suitability and competence for the position can be demonstrated with various other qualifications and certificates. The profession of internal auditor will become a liberal profession, as it is in the private sector. Opportunities for recruiting internal auditors will expand in the public sector and the work of internal auditors will become more accessible to a wider circle of people.
The repeal of the obligation to hold the profession of internal auditor will result in the repeal of all regulations concerning internal auditors provided for in the Auditors Activities Act.
The aim of the bill is to reduce bureaucracy in the public sector, update the requirement to acquire the profession of internal auditor and the regulations concerning the professional practice of internal auditors, and bring the regulations into line with actual opportunities and needs.
Under the Bill on Amendments to the State Assets Act (772 SE), initiated by the Government, the Act will be amended to streamline the administration of the state’s holding and make the regulation of supervisory boards and internal audit more flexible and clearer. The bill focuses on three major amendments: making the selection of civil servants as members of the supervisory board more flexible, reducing the representation of the Ministry of Finance on the supervisory boards of foundations, and specifying and enhancing the internal audit obligation.
The ministry, as the holding administrator, will in future be able to elect and recall its representative on the supervisory board of a state-owned company without a proposal from the appointments committee. This will reduce the workload of the appointments committee and give the holding administrator greater flexibility. The number of foundations where one member of the supervisory board must be appointed on the proposal of the Minister of Finance will decrease from 59 to 20. This obligation remains only for larger foundations.
The thresholds for the application of the internal audit obligation will be significantly raised. The new obligation will arise when the balance sheet total exceeds EUR 15 million or revenues exceed EUR 10 million. Internal auditor may be forgone only in the case when there is no obligation to form an audit committee and the internal audit unit of the administrator of the State’s holding or the person exercising the founder’s rights is used. The number of companies with an internal audit obligation will increase from 18 to 19; the number of foundations will decrease from 47 to 20.
The role of the holding administrator as a supervisor will be strengthened in order to simplify the assessment of the performance of partially state-owned companies and foundations. The holding administrator will be given the explicit right to examine the work of the supervisory board and internal audit documents, such as minutes and audit results. This will improve the transparency and oversight options regarding the management of state-owned enterprises.
As of 31 July 2025, the state had holdings in 27 companies (including three inactive ones), 65 foundations, and 15 non-profit organizations.
Reili Rand from the Social Democratic Party Group and Aivar Kokk from Isamaa Parliamentary Group took the floor during the debate.
Verbatim record of the sitting (in Estonian)
Video recording will be available to watch later on the Riigikogu YouTube channel.
Riigikogu Press Service
Maiki Vaikla
+372 631 6456, +372 5666 9508
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