# C_2008311EN.01015601.xml

| 5.12.2008 | EN | Official Journal of the European Union | C 311/156 |
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5.12.2008

EN

Official Journal of the European Union

C 311/156

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REPORT

REPORT

on the annual accounts of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2007 together with the Foundation's replies

(2008/C 311/23)

CONTENTS

| 1-2 | INTRODUCTION |
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1-2

| 3-6 | STATEMENT OF ASSURANCE |
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3-6

| 7-10 | OBSERVATIONS |
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7-10

Tables 1 to 4

The Foundation's replies

The Foundation's replies

INTRODUCTION

| 1. | The European Foundation for the Improvement of Living and Working Conditions (hereinafter referred to as ‘the Foundation’) was set up by Council Regulation (EEC) No 1365/75 of 26 May 1975 (1). Its aim is to contribute to the planning and establishment of better living and working conditions in the European Union by increasing and disseminating knowledge which is relevant to this subject. |
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1.

The European Foundation for the Improvement of Living and Working Conditions (hereinafter referred to as ‘the Foundation’) was set up by Council Regulation (EEC) No 1365/75 of 26 May 1975 (1). Its aim is to contribute to the planning and establishment of better living and working conditions in the European Union by increasing and disseminating knowledge which is relevant to this subject.

1

| 2. | Table 1 summarises the Foundation's competences and activities. Key data summarised from the financial statements drawn up by the Foundation for the financial year 2007 are presented in Tables 2, 3 and 4 for information purposes. |
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2.

Table 1 summarises the Foundation's competences and activities. Key data summarised from the financial statements drawn up by the Foundation for the financial year 2007 are presented in Tables 2, 3 and 4 for information purposes.

Table 1

Tables 2, 3 and 4

STATEMENT OF ASSURANCE

| 3. | This Statement of assurance is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). It was drawn up following an examination of the Foundation's accounts, as required by Article 248 of the Treaty establishing the European Community. |
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3.

This Statement of assurance is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). It was drawn up following an examination of the Foundation's accounts, as required by Article 248 of the Treaty establishing the European Community.

2

| 4. | The Foundation's accounts for the financial year ended 31 December 2007 (3) were drawn up by its Director, pursuant to Article 16 of Council Regulation (EEC) No 1365/75, and sent to the Court, which is required to provide a statement on their reliability and on the legality and regularity of the underlying transactions. |
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4.

The Foundation's accounts for the financial year ended 31 December 2007 (3) were drawn up by its Director, pursuant to Article 16 of Council Regulation (EEC) No 1365/75, and sent to the Court, which is required to provide a statement on their reliability and on the legality and regularity of the underlying transactions.

3

| 5. | The Court conducted its audit in accordance with the IFAC and ISSAI (4) International Auditing Standards and Codes of Ethics, in so far as these are applicable in the European Community context. The audit was planned and performed to obtain reasonable assurance that the accounts are reliable and that the underlying transactions are legal and regular. |
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5.

The Court conducted its audit in accordance with the IFAC and ISSAI (4) International Auditing Standards and Codes of Ethics, in so far as these are applicable in the European Community context. The audit was planned and performed to obtain reasonable assurance that the accounts are reliable and that the underlying transactions are legal and regular.

4

| 6. | The Court has thus obtained a reasonable basis for the Statement set out below:

  Reliability of the accountsThe Foundation's accounts for the financial year ended 31 December 2007 are, in all material respects, reliable.Legality and regularity of the underlying transactionsThe transactions underlying the Foundation's annual accounts, taken as a whole, are legal and regular.The observations which follow do not call the Court's Statement into question. |
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6.

The Court has thus obtained a reasonable basis for the Statement set out below:

Reliability of the accountsThe Foundation's accounts for the financial year ended 31 December 2007 are, in all material respects, reliable.Legality and regularity of the underlying transactionsThe transactions underlying the Foundation's annual accounts, taken as a whole, are legal and regular.The observations which follow do not call the Court's Statement into question.

Reliability of the accountsThe Foundation's accounts for the financial year ended 31 December 2007 are, in all material respects, reliable.Legality and regularity of the underlying transactionsThe transactions underlying the Foundation's annual accounts, taken as a whole, are legal and regular.The observations which follow do not call the Court's Statement into question.

OBSERVATIONS

| 7. | The Foundation's 2007 budget amounted to 20,2 million euro, as compared to 19,8 million euro for the previous year. It included contributions from the Commission to prepare the future membership of Croatia and Turkey. These contributions should have been treated as assigned revenue in the budget, but that was not the case. This situation was not in conformity with the Financial Regulation. |
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7.

The Foundation's 2007 budget amounted to 20,2 million euro, as compared to 19,8 million euro for the previous year. It included contributions from the Commission to prepare the future membership of Croatia and Turkey. These contributions should have been treated as assigned revenue in the budget, but that was not the case. This situation was not in conformity with the Financial Regulation.

| 8. | Recoverable VAT for the 2007 financial year of 376 611 euro was not claimed by the year end. VAT claims should be recovered from time to time during the year. This situation was at odds with the principle of sound financial management. |
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8.

Recoverable VAT for the 2007 financial year of 376 611 euro was not claimed by the year end. VAT claims should be recovered from time to time during the year. This situation was at odds with the principle of sound financial management.

| 9. | In the case of recruitment procedures, neither the weighting of the selection criteria nor the minimal scores to be achieved were decided by the Selection Board from the outset. Moreover, in one case, the selection criteria defined were either not in conformity with the vacancy notice or remained vague. This did not ensure transparent and non-discriminatory procedures. |
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9.

In the case of recruitment procedures, neither the weighting of the selection criteria nor the minimal scores to be achieved were decided by the Selection Board from the outset. Moreover, in one case, the selection criteria defined were either not in conformity with the vacancy notice or remained vague. This did not ensure transparent and non-discriminatory procedures.

| 10. | With regard to procurement procedures, the following anomalies were observed: financial evaluation procedure for a contract not clearly specified in the tender documents and selection criteria not allowing proper performance of an evaluation of the financial capacity of the candidates (5). These weaknesses undermined the quality of the procedure and risked biasing the final selection. |
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10.

With regard to procurement procedures, the following anomalies were observed: financial evaluation procedure for a contract not clearly specified in the tender documents and selection criteria not allowing proper performance of an evaluation of the financial capacity of the candidates (5). These weaknesses undermined the quality of the procedure and risked biasing the final selection.

5

This report was adopted by the Court of Auditors in Luxembourg at its meeting of 18 September 2008.

For the Court of Auditors

Vítor Manuel da SILVA CALDEIRA

President

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(1)  OJ L 139, 30.5.1975, p. 1.

1

(2)  OJ L 248, 16.9.2002, p. 1.

2

(3)  These accounts were drawn up on 30 June 2008 and received by the Court on 18 July 2008.

3

(4)  International Federation of Accountants (IFAC) and International Standards of Supreme Audit Institutions (ISSAI).

4

(5)  Three cases.

5

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Table 1

European Foundation for the Improvement of Living and Working Conditions (Dublin)

| Areas of Community competence deriving from the Treaty | Competences of the Foundation as defined in Council Regulation (EEC) No 1365/75 as amended by Regulation (EC) No 1111/2005 | Governance | Resources available to the Foundation

  (Data for 2006) | Activities and services provided in 2007 |
| --- | --- | --- | --- | --- |
| ‘The Community and the Member States, having in mind fundamental social rights, ... shall have as their objectives ... improved living and working conditions, ... the Community shall support and complement the activities of the Member States in the following fields; ... b) working conditions; c) social security and the social protection of workers; d) protection of workers where their employment contract is terminated; e) the information and consultation of workers; f) representation and the collective defence of the interests of workers and employers, including co-determination; g) conditions of employment for third-country nationals; h) the integration of persons excluded from the labour market; i) equality between men and women ...’

  (Articles 136 and 137 of the Treaty) | Objectives

  The aim of the Foundation shall be to contribute to the establishment of better living and working conditions by increasing and disseminating knowledge which is relevant to this subject. In particular, it is required to consider the following areas:






  — | Man at work. |

Areas of Community competence deriving from the Treaty

Competences of the Foundation as defined in Council Regulation (EEC) No 1365/75 as amended by Regulation (EC) No 1111/2005

Governance

Resources available to the Foundation

(Data for 2006)

Activities and services provided in 2007

‘The Community and the Member States, having in mind fundamental social rights, ... shall have as their objectives ... improved living and working conditions, ... the Community shall support and complement the activities of the Member States in the following fields; ... b) working conditions; c) social security and the social protection of workers; d) protection of workers where their employment contract is terminated; e) the information and consultation of workers; f) representation and the collective defence of the interests of workers and employers, including co-determination; g) conditions of employment for third-country nationals; h) the integration of persons excluded from the labour market; i) equality between men and women ...’

(Articles 136 and 137 of the Treaty)

Objectives

The aim of the Foundation shall be to contribute to the establishment of better living and working conditions by increasing and disseminating knowledge which is relevant to this subject. In particular, it is required to consider the following areas:

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Man at work.

| — | Organisation of work and particularly job design. |
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Organisation of work and particularly job design.

| — | Problems peculiar to certain categories of workers. |
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—

Problems peculiar to certain categories of workers.

| — | Long-term aspects of the improvement of the environment. |
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—

Long-term aspects of the improvement of the environment.

| — | The distribution of human activities in space and in time. |
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—

The distribution of human activities in space and in time.

Tasks

| — | To foster the exchange of information and experience in these fields. |
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—

To foster the exchange of information and experience in these fields.

| — | To facilitate contact between universities, study and research institutes, economic and social administrations and organisations. |
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—

To facilitate contact between universities, study and research institutes, economic and social administrations and organisations.

| — | To carry out studies or to conclude study contracts and to provide assistance for pilot projects. |
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—

To carry out studies or to conclude study contracts and to provide assistance for pilot projects.

| — | To cooperate as closely as possible with existing specialised institutes in the Member States and at international level. |
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—

To cooperate as closely as possible with existing specialised institutes in the Member States and at international level.

1.   The Governing Board (GB)

| — | From each MemberState: one government representative, one representative from employers' organisations and one workers' representative. |
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From each MemberState: one government representative, one representative from employers' organisations and one workers' representative.

| — | Three representatives from the Commission. |
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—

Three representatives from the Commission.

2.   The Bureau of the GB

| — | Consists of 11 members; three members from each of the social partners and the governments, two from the Commission. |
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Consists of 11 members; three members from each of the social partners and the governments, two from the Commission.

| — | It monitors the implementation of decisions of the GB and takes measures to ensure proper management between GB meetings. |
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—

It monitors the implementation of decisions of the GB and takes measures to ensure proper management between GB meetings.

| 3. | The Director is appointed by the Commission from a list of candidates submitted by the GB, he implements the decisions of the GB and the Bureau of the GB and manages the Foundation. |
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3.

The Director is appointed by the Commission from a list of candidates submitted by the GB, he implements the decisions of the GB and the Bureau of the GB and manages the Foundation.

| 4. | The Advisory Committees are composed of up to 3 members from the Commission, governments and the social partners, with the aim of advising on the implementation of major projects and the assessment of results. |
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4.

The Advisory Committees are composed of up to 3 members from the Commission, governments and the social partners, with the aim of advising on the implementation of major projects and the assessment of results.

5.   External audit

Court of Auditors.

6.   Discharge authority

Parliament acting on recommendation of the Council.

Final Budget 2007:

20,2 million Euro (19,8 million euro)

Staff in December 2007:

94 (94) posts provided for in the establishment plan, of which 84 (89) were occupied

Other Staff:

Seconded National Experts and employment agency staff: 3 (1)

Contract Agents: 10 (9)

Total Staff employed: 97 (99)

Operating activities: 55 (58)

Administrative tasks: 30 (32)

Mixed: 4 (4)

Monitoring and surveys:

| — | European Industrial Relations Observatory (EIRO), European Working Conditions Observatory (EWCO) and European Restructuring Monitor (ERM); |
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—

European Industrial Relations Observatory (EIRO), European Working Conditions Observatory (EWCO) and European Restructuring Monitor (ERM);

| — | 4th European Working Conditions Survey: secondary analysis (themes of gender and working conditions, ageing workforce, work organisation, working time and work intensity ...); |
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—

4th European Working Conditions Survey: secondary analysis (themes of gender and working conditions, ageing workforce, work organisation, working time and work intensity ...);

| — | European survey on working time and work-life balance: five reports published in 2007. Preparations for the second survey. |
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European survey on working time and work-life balance: five reports published in 2007. Preparations for the second survey.

Employment and restructuring:

| — | Undeclared work; |
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—

Undeclared work;

| — | European Restructuring Monitor case studies; |
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—

European Restructuring Monitor case studies;

| — | Stakeholder enquiry service. |
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—

Stakeholder enquiry service.

Work–life balance and working conditions:

| — | Attractive workplace for all; |
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—

Attractive workplace for all;

| — | Flexibility and security over the life course; |
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—

Flexibility and security over the life course;

| — | Changes in the job structure. |
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—

Changes in the job structure.

Industrial relations and partnership:

| — | Codes of conduct and framework agreements; |
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—

Codes of conduct and framework agreements;

| — | Capacity building for sectoral and local level; social dialogue in the EU 10; |
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—

Capacity building for sectoral and local level; social dialogue in the EU 10;

| — | Working time and industrial relations. |
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—

Working time and industrial relations.

Social cohesion and quality of life:

| — | Role of local authorities in the integration of migrants; |
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—

Role of local authorities in the integration of migrants;

| — | Developments in childcare services in disadvantaged areas; |
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—

Developments in childcare services in disadvantaged areas;

| — | Promoting quality of life in rural Europe. |
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—

Promoting quality of life in rural Europe.

Communication and sharing ideas and experience:

| — | 376 publications, 1,57 million users sessions (average of 4 303/day); |
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—

376 publications, 1,57 million users sessions (average of 4 303/day);

| — | 37 press activities, 45 press releases, up 28 % on 2006; |
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—

37 press activities, 45 press releases, up 28 % on 2006;

| — | 1 126 article cuttings with advertising value equivalent (AVE) of 2,1 million euro, reaching ca 58 765 000 people, up 80 % from 32 536 000 in 2006. 252 journalist enquiries, +9 % up on the previous year; |
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—

1 126 article cuttings with advertising value equivalent (AVE) of 2,1 million euro, reaching ca 58 765 000 people, up 80 % from 32 536 000 in 2006. 252 journalist enquiries, +9 % up on the previous year;

| — | Promotion campaign ‘Fourth Working Conditions Survey: what workers say’, ‘Quality of Life in Turkey’; |
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—

Promotion campaign ‘Fourth Working Conditions Survey: what workers say’, ‘Quality of Life in Turkey’;

| — | Roadshows in five countries; |
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—

Roadshows in five countries;

| — | Company Network Seminars on Diversity in Europe and Environmental Changes; |
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—

Company Network Seminars on Diversity in Europe and Environmental Changes;

| — | Foundation Seminar Series ‘Youth and Work’; |
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—

Foundation Seminar Series ‘Youth and Work’;

| — | National Outreach Centres covering 10 Members States; |
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—

National Outreach Centres covering 10 Members States;

| — | 16 exhibitions; |
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16 exhibitions;

| — | 58 visits to the Foundation, including the Finnish President. |
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—

58 visits to the Foundation, including the Finnish President.

Source: Information supplied by the Foundation.

Table 2

European Foundation for the Improvement of Living and Working Conditions (Dublin) — Implementation of the budget for the financial year 2007

| (1000 euro) |
| --- |
| Revenue (1) | Expenditure (1) |
| Source of revenue | Revenue entered in the final budget for the financial year | Revenue collected | | Appropriations for the financial year | Appropriations carried over from previous financial year |
| entered | committed | paid | carried over | cancelled | available | paid | cancelled |
| Community subsidy | 19 600 | 19 600 | Title I
  Staff | 10 687 | 10 260 | 10 084 | 243 | 360 | 120 | 94 | 26 |
| Other subsidies | 300 | 340 | Title II
  Administration | 1 272 | 1 190 | 892 | 370 | 10 | 635 | 567 | 68 |
| Other revenue | 280 | 321 | Title III
  Operating activities | 8 221 | 7 943 | 3 712 | 4 397 | 112 | 3 557 | 3 410 | 147 |
| Total | 20 180 | 20 261 | Total | 20 180 | 19 393 | 14 688 | 5 010 | 482 | 4 312 | 4 071 | 241 |
| Source: Data supplied by the Foundation — This table summarises the data supplied by the Foundation in its annual accounts. Revenue collected and payments are estimated on a cash basis. |

(1000 euro)

Revenue (1)

Expenditure (1)

Source of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Appropriations for the financial year

Appropriations carried over from previous financial year

entered

committed

paid

carried over

cancelled

available

paid

cancelled

Community subsidy

19 600

19 600

Title I

Staff

10 687

10 260

10 084

243

360

120

94

26

Other subsidies

300

340

Title II

Administration

1 272

1 190

892

370

10

635

567

68

Other revenue

280

321

Title III

Operating activities

8 221

7 943

3 712

4 397

112

3 557

3 410

147

Total

20 180

20 261

Total

20 180

19 393

14 688

5 010

482

4 312

4 071

241

Source: Data supplied by the Foundation — This table summarises the data supplied by the Foundation in its annual accounts. Revenue collected and payments are estimated on a cash basis.

Table 3

European Foundation for the Improvement of Living and Working Conditions (Dublin) — Economic outturn account for the financial years 2007 and 2006

| (1000 euro) |
| --- |
| | 2007 | 2006 |
| Operating revenue |
| Community subsidies | 19 600 | 19 000 |
| Other subsidies | 340 | 517 |
| Other revenue | 884 | 248 |
| Total (a) | 20 824 | 19 765 |
| Operating expenses |
| Staff expenses | 9 132 | 8 908 |
| Fixed asset related expenses | 608 | 724 |
| Other administrative expenses | 2 416 | 2 106 |
| Operational expenses | 8 597 | 7 409 |
| Total (b) | 20 753 | 19 147 |
| Surplus/(deficit) from operating activities (c = a – b) | 71 | 618 |
| Financial operations revenue (e) | 0 | 0 |
| Financial operations expenses (f) | 4 | 10 |
| Surplus/(deficit) from non-operating activities (g = e – f) | –4 | –10 |
| Economic result for the year (h = c + g) | 67 | 608 |
| Source: Data supplied by the Foundation — This table summarises the data provided by the Foundation in its annual accounts: these accounts are drawn up on an accrual basis. |

(1000 euro)

2007

2006

Operating revenue

Community subsidies

19 600

19 000

Other subsidies

340

517

Other revenue

884

248

Total (a)

20 824

19 765

Operating expenses

Staff expenses

9 132

8 908

Fixed asset related expenses

608

724

Other administrative expenses

2 416

2 106

Operational expenses

8 597

7 409

Total (b)

20 753

19 147

Surplus/(deficit) from operating activities (c = a – b)

71

618

Financial operations revenue (e)

0

0

Financial operations expenses (f)

4

10

Surplus/(deficit) from non-operating activities (g = e – f)

–4

–10

Economic result for the year (h = c + g)

67

608

Source: Data supplied by the Foundation — This table summarises the data provided by the Foundation in its annual accounts: these accounts are drawn up on an accrual basis.

Table 4

European Foundation for the Improvement of Living and Working Conditions (Dublin) — Balance sheet at 31 December 2007 and 2006

| (1000 euro) |
| --- |
| | 2007 | 2006 |
| Non-current assets |
| Intangible fixed assets | 46 | 84 |
| Tangible fixed assets | 3 327 | 2 388 |
| Current assets |
| Short-term pre-financing | 732 | 344 |
| Short-term receivables | 1 095 | 690 |
| Cash and cash equivalents | 4 635 | 3 111 |
| Total assets | 9 835 | 6 617 |
| Current liabilities |
| Provisions for risks and charges | 141 | 274 |
| Accounts payable | 3 695 | 1 643 |
| Total liabilities | 3 836 | 1 917 |
| Net assets | 5 999 | 4 700 |
| Reserve |
| Accumulated surplus/deficit | 5 932 | 4 092 |
| Economic result for the year | 67 | 608 |
| Net capital | 5 999 | 4 700 |
| Source: Data supplied by the Foundation — This table summarises the data provided by the Foundation in its annual accounts: these accounts are drawn up on an accrual basis. |

(1000 euro)

2007

2006

Non-current assets

Intangible fixed assets

46

84

Tangible fixed assets

3 327

2 388

Current assets

Short-term pre-financing

732

344

Short-term receivables

1 095

690

Cash and cash equivalents

4 635

3 111

Total assets

9 835

6 617

Current liabilities

Provisions for risks and charges

141

274

Accounts payable

3 695

1 643

Total liabilities

3 836

1 917

Net assets

5 999

4 700

Reserve

Accumulated surplus/deficit

5 932

4 092

Economic result for the year

67

608

Net capital

5 999

4 700

Source: Data supplied by the Foundation — This table summarises the data provided by the Foundation in its annual accounts: these accounts are drawn up on an accrual basis.

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(1)  Includes assigned revenue.

Source: Data supplied by the Foundation — This table summarises the data supplied by the Foundation in its annual accounts. Revenue collected and payments are estimated on a cash basis.

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THE FOUNDATION'S REPLIES

| 7. | From 2008 on, we have set up budget lines for assigned revenues in ABAC and will proceed according to the Court's recommendation. |
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7.

From 2008 on, we have set up budget lines for assigned revenues in ABAC and will proceed according to the Court's recommendation.

| 8. | Due to introduction of the new financial software ABAC, the VAT recovery for 2007 was delayed. It was processed in April 2008 and fully recovered. |
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8.

Due to introduction of the new financial software ABAC, the VAT recovery for 2007 was delayed. It was processed in April 2008 and fully recovered.

| 9. | In 2008 Eurofound has already adapted the recruitment procedure to address the issues highlighted by the Court. |
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9.

In 2008 Eurofound has already adapted the recruitment procedure to address the issues highlighted by the Court.

| 10. | The Foundation used the criticised procedure due to budgetary uncertainties. However, the Foundation is confident that best value for money was achieved. In future, price evaluation methods will be defined in a way that avoids discretionary power from the outset.
  With regard to the financial capacity, Article 135(2) of the Implementing Rules stipulates that the Foundation may lay down minimum capacity levels. In future, the Foundation will lay down criteria for the application of minimum financial capacity levels. |
| --- | --- |

10.

The Foundation used the criticised procedure due to budgetary uncertainties. However, the Foundation is confident that best value for money was achieved. In future, price evaluation methods will be defined in a way that avoids discretionary power from the outset.

With regard to the financial capacity, Article 135(2) of the Implementing Rules stipulates that the Foundation may lay down minimum capacity levels. In future, the Foundation will lay down criteria for the application of minimum financial capacity levels.

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