The European Commission has welcomed the Court of Auditors’ positive statement of assurance on the EU 2005 accounts, drawn for the first time under a new accounting system, but questioned some of the Court’s criticism related to the effectiveness of control systems.
In its annual report the European Court of Auditors has given a positive statement of assurance as to the reliability of the EU accounts. The Court also gave its opinion on the regularity of the ‘underlying transactions’ (i.e. payments to and from the EU coffers), with a positive declaration for revenue, administrative expenditure, and parts of the pre-accession and agriculture expenditure; the Court said it was not able to give an unqualified assurance for the remaining areas of EU spending.
Siim Kallas, vice president of the European Commission responsible for administration, audit and anti-fraud, welcomed the Court’s positive assessment of the EU accounts: “2005 was the first year when the Commission used a thoroughly modernised accounting system. In spite of the complexity of the reform and apart from the obvious related teething problems, the Commission delivered on its pledge to implement the system within two years, a timeframe that the Court itself considered very ambitious.”
At the same time the Commission expressed concerns related to the Court’s statements on the underlying transactions: “The Commission fundamentally disagrees with the way the Court is still focused on finding individual errors in small samples of transactions, and with how it makes extrapolations which are widely misinterpreted. One will always find errors in individual transactions, in any organisation, but we have effective mechanisms to claw back any undue payments. In 2005 the Commission recovered more than EUR 2 170 mln. The Court should finally recognise this”, said Kallas.
The Court still concentrates on the number and importance of errors it finds in the EU spending in a given year. EU control systems, however, operate on a multi-annual basis and effectively correct past errors, safeguarding taxpayers’ interests. The Commission thinks it is essential that the Court takes this multi-annual nature of EU spending more into account, even if the Treaties oblige the Court to produce an annual statement.
The Commission is determined to achieve a complete positive statement of assurance by 2009 though it is aware of the challenge: not only is the audit process for the EU incomparably tougher than in the case of audits of national budgets (where departments are usually evaluated separately and are not subject to a single annual verdict), but it is also more complex in the sense that the management of the EU budget is highly decentralised, with as much as 76% of money spent by national or local authorities. The Commission welcomes Member States’ promise to provide annual declarations on how the EU money under their management was spent.
“The Commission hopes Member States will cooperate, moving us closer towards a positive opinion of the Court”, concluded Kallas.
“Modernising the EU accounts”, a guide to the EU’s new financial reporting is available at :
http://ec.europa.eu/budget/publications/fin_manag_account_en.htm
