the role of national audit institutions in the audit of eu funds an eu perspective by irena...
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3 The majority of EU funds are spent within the EU implementing the Community’s agricultural and structural policiesTRANSCRIPT
The role of National Audit Institutions The role of National Audit Institutions in the audit of EU fundsin the audit of EU funds
An EU perspectiveAn EU perspective
by Irena Petruškevičienė,by Irena Petruškevičienė, Member of the European Court of Auditors Member of the European Court of Auditors
Vilnius, 20 March 2007
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Over €100 bn is raised each year to fund the EU budget, mostly from Member States contributions based on their Gross
National Incomes (GNI) and Value Added Tax bases
€108,4 billion ≈1% of GNI
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The majority of EU funds are spent within the EU implementing the Community’s agricultural and
structural policies
Stuctural policies
30%
Pre-accession
strategy 2%External
action 5%
Internal policies 8%
Admin 6%
Other 1%
Agriculture 47%
Arrangements for implementing the EU budget are complex; the majority of spending involves shared management
between the Commission and Member StatesEU
EU-budgetAdmin External
actionsInternal policies
Structuralpolicies
Agriculture
Payment Payment- Advance- Payment
- Advance- Payment
- Advance- Payment
Verification
Beneficiary
Third country
Beneficiary Beneficiary
Activity ActivityActivity
National budget
Paying and implementing agencies
Payment
Verification
Documentation Documentation Declaration Declaration
Member state
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Shared management results in responsibilities for controlling and auditing the use of EU funds
at both EU and national level
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The relative importance of EU funding is different from the Lithuanian national budget perspective than from the EU
budget perspective
% share of respective budgets in 2006
Lithuania
Lithuania
EUEU02468
101214
EU Revenue EU Expenditure
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The Court adds value by auditing EU policies (not Member States) from Commission level down to the
level of the final beneficiary of EU funds
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Cooperation by the ECA with NAIs is required by the Treaty and professional standards, and takes a number of forms
Contact committee & Liaison officers
Correspondence
Participation inon-the-spot visits
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The Court must provide assurance on the reliability of accounts and the legality and regularity of underlying transactions, and
examine whether financial management was the sound.
Were the rules
followed?
Are the accounts correct?
Was the money
well spent?
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The Court presents its findings to the European Parliament and Council and publishes its reports and opinions in the
Official Journal of the EU and on its website
Annual Report: Statement of Assurance, observations on the implementation of the EU budget
Specific Annual Reports: on EU organisations or agencies
Special Reports: on specific budgetary areas or management topics
Opinions: on new or amended legislation with financial impact
www.eca.europa.euwww.eca.europa.eu
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Key messages of the Court’s Annual Report 2006 are in line with previous years; material level of error in some areas
but significant progress made in others
• EU accounts are reliable
• Material error in some areas of expenditure, particularly structural policies
• Marked fall in error rate in agriculture due to the operation of the Integrated Admin. and Control system (IACS)
• Revenue, administration, pre-accession strategy and part of external actions free from material errors
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No major observations about Lithuania in the annual report but illustrative observations about other Member
States identify risky areas on which to focus audit work
• the Court audits by policy area not Member State, so reference to Member States in the reports of the Court are often illustrative
• Lithuania receives only 0,8 % of EU funds; the number of audit missions carried out in Lithuania reflects this
• Lithuania only recently joined the EU so funding still in the “take off” phase
• National administrations are in similar situations, so observations about other Member States could apply
• Such observations can and do help National Audit Institutions like the National Audit Office of Lithuania to identify risks