On December 30, 2025, the Agency for Monitoring State Enterprises under the Ministry of Finance was established in accordance with the Decree "On additional measures related to the improvement of the activities of the Ministry of Finance" signed by President Ilham Aliyev.
Modern.az presents the functions that the newly established Agency will perform, how it will affect the financial management of state enterprises, and the essence of the control mechanisms.
The Agency for Monitoring State Enterprises under the Ministry of Finance has been formed as a new structure that will exercise systematic control over the financial activities of state-owned enterprises. The Agency is directly included in the structure of the Ministry of Finance of the Republic of Azerbaijan, and its main function is to continuously monitor the budget discipline, financial health, and fiscal risks of state enterprises.
The establishment of this structure effectively serves to centralize the control and analysis mechanisms that have been fragmented for many years.
One of the main areas of activity of the Agency is the monitoring of the implementation of annual and medium-term budget projects, as well as revenue and expenditure estimates of state enterprises. This means that not only the planned financial indicators of state enterprises but also the level of implementation of these indicators will be analyzed on a quarterly basis.
Thus, budget documents will move beyond the formal approval stage and be measured by actual implementation results.
The powers granted to the Agency also include direct control over the payment of dividends from the net profit of state enterprises to the state budget.
This mechanism aims to ensure that, in cases where state enterprises generate profit, these funds are directed to the budget in a timely and full amount. Consequently, dividends will no longer be merely recommendatory but will be monitored as a serious fiscal obligation.
One of the points that holds a special place in the Statute is risk-based monitoring mechanisms. The Agency will evaluate the financial and economic activities of state enterprises through early warning tests, stress tests, and other analytical tools.
This approach will allow for the detection of risks that could potentially create a burden on the state budget before they reach a crisis stage.
The Agency will participate both in the forecasting of budget funds allocated to state enterprises and in the evaluation of the efficiency of these funds.
This will ensure that subsidies, state orders, and targeted financing are linked to real economic outcomes, thereby forming a more rational financial balance between the state budget and state enterprises.
Based on the Agency's analyses, proposals will be submitted to the Ministry of Finance for the preparation of information on the current state and dynamics of the financial health of state enterprises, which will be presented to the President of the Republic of Azerbaijan once a quarter.
This mechanism will enable the highest executive authority to promptly view the real financial picture of state enterprises.
The activity of the new Agency marks the beginning of a new stage for state enterprises in terms of both financial transparency and management discipline.
The approval of budget projects, optimization of expenditures, measurement of risks, and execution of dividends will now be carried out under institutional control. This makes the activities of state enterprises more accountable and results-oriented.
The powers of the Agency for Monitoring State Enterprises under the Ministry of Finance are not limited to internal resources alone. The Agency is granted the right to engage independent experts, specialized professionals, consulting, and scientific organizations in its activities on a contractual basis.
This approach will prevent subjective approaches in evaluating the financial condition of state enterprises and enable the application of international and scientifically based methods. This cooperation, to be carried out within the allocated funds, will ensure deeper analytical analyses and more precise identification of risks.
According to the Statute, the Agency has the authority to establish working groups and commissions for specific areas. This mechanism will be applied particularly during the evaluation of fiscal risks, the conduct of stress tests, and the comprehensive analysis of the financial and economic activities of state enterprises.
Through working groups, it will be possible to conduct in-depth investigations for a single enterprise and to obtain summary results for state enterprises operating in the same field. This will create conditions for decisions to be made based on systematic data, rather than individual cases.
The involvement of independent experts and scientific institutions serves as one of the key factors enhancing the quality of opinions and proposals prepared by the Agency. This model will ensure that decisions related to state enterprises are formed not solely through an administrative approach, but based on scientifically substantiated financial analyses.
Consequently, the Agency's activities will transform into a more flexible, substantiated, and long-term fiscal sustainability-oriented management model.
It should be noted that the Cabinet of Ministers must, within one month, determine the staff limit of the Agency for Monitoring State Enterprises under the Ministry of Finance of the Republic of Azerbaijan, take necessary measures regarding the material and technical provision of the Agency for Monitoring State Enterprises under the Ministry of Finance of the Republic of Azerbaijan and the financing of its maintenance costs, and resolve other issues arising from this Decree.
