Application of management audit for increasing economic efficiency of state-owned enterprises activities

To substantiate the direction of the research, this paper establishes the factors which affect performance efficiency of state-owned enterprises (SOEs). The authors’ analyse the effect of management control on the economic efficiency of activities of state-owned enterprises by application of management audit. The paper seeks to highlight the higher utility of economic activity as well as return of capital which was used in the process of activities. The paper analyses the quality of management and economic activity in SOEs based on scientific literature as well as reports and decisions of the representative government institutions as well as the results of empirical research which was accomplished in Lithuania. The paper stresses that the state-owned commercial property in Lithuania has thus far been managed inefficiently. Unlike private companies, SOEs practically fail to render much use to the state. This fact does not allow SOE’s to reach the highest economic benefit. Accordingly, the authors’ present an innovative approach towards the improvement of the management of SOEs economic activities through application of the audit principles, which traditionally are associated with the assessments of financial activity. The proposed model can be further extended and employed in other countries of Northern Europe, specifically in Latvia, Estonia and other Post-Soviet countries