Portuguese PPP’s special purpose vehicle entities

: an audit approach

Abstract

The purpose of this thesis is to assess if audit of Private Public Partnerships (PPP), especially regarding Financial Statements of the private partner involved, is sufficient and meets the needs of its stakeholders. This is an issue that has an important role in the discussion of PPP arrangements in Portugal, where Value for Money and political use of such arrangements has been thoroughly debated, but little has been said and written regarding the private partner overseeing. To address these issues first we visit the main requirements for a financial statements auditor, based on the International Standards on Auditing, and then we outline a proposed audit approach for a Special Purpose Vehicle (SPV) entity involved in a Private Public Partnership. Next we consider a case study, Escala Braga – Sociedade Gestora do Estabelecimento SA, SPV in charge of managing Braga Hospital in the north of Portugal. Furthermore possible adjustments to the planned audit approach are discussed if other SPV involved in PPP were to be borne in mind. Although, as we realize, the auditor requirements of the SPV entity involved in a PPP arrangement are the same as any other privately held company, we address the fact that those companies may be subject to higher scrutiny from stakeholders of the PPP arrangement itself and planned an audit approach able to give a thorough evaluation of Escala Braga’s financial statements. That fact leads to the conclusion that, given the specificities of the companies involved in PPP arrangements, there is a lack of special legislation on those companies, mainly regarding financial statements disclosure.

Date of Award	2013
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Ricardo Reis (Supervisor)