The Public Financial Inspection Agency (PFIA) is an administration under the minister of finance created in 2006 after implementing of significant reform in the scope of Public Internal Financial control (PIFC). The basic objectives, of the Public Financial Inspection Agency are to protect the public financial interest trough implementing of follow up financial inspections for observing the normative acts providing the budget, financial-economic or accounting activity of organizations and persons in the scope of its activity. PFIA is the institution of realizing sanctioning function after uncovering of breaches - reveal caused damages and bringing to administrative punitive and proprietary responsibility of the guilty persons upon existence of the respective lawful grounds. It is the unique competent authority in the country, which realizing administrative punitive responsibility of the public procurements. Main task of the public financial inspection is determining of frauds and breaches of EU financial interests. The fundamental activity principles are lawfulness, objectivity, official principle and confidentiality.
About the PIFC reform
Before the reform, internal audit function and the inspection function had centralized and performed from the authority of Public Internal Financial Control Agency (PIFCA). According to European practices, the internal audit has been implementing by audit units, belongs to the relevant spenders of budget funds. The Bulgarian government had adopted this European model of financial control, simultaneously abrogated The Public Internal Financial Control Act. Those are The Internal audit Act, The Public Financial Inspection Law and Law of the Financial Management and Control in the public sector.
The decentralization of the internal audit is fundamental about PIFC reform-560 persons PIFC auditors had transferred to municipalities and spenders with funds from Republic budget as servants to the relevant administrations.
The second fundamental reform stage had been the set up of the Public Financial Inspection Agency as a legal successor of the PIFCA, since 25 of April 2006, when came into force The Public Financial Inspection Law. The Law had issued according with the commitment within the legal framework of the negotiation process under Chapter 28 - "Financial control" with the assistance of SIGMA experts. The main terms of reference of The Public Financial Inspection Law are within the Document of the PIFC Policy, adopted of the Council of Ministers in 2002 and renewed in 2005 with the Decision of the PIFC Commission in 2 Aug 2004. The Law had conformed from GD Budget of the European Commission. The Public Financial Inspection Law provides the objectives, the principles and the scope of the activity of state financial inspection as well as the status and the functions of the Public Financial Inspection Agency.