# C_2006312EN.01006701.xml

| 19.12.2006 | EN | Official Journal of the European Union | C 312/67 |
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19.12.2006

EN

Official Journal of the European Union

C 312/67

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REPORT

REPORT

on the annual accounts of Eurojust for the financial year 2005 together with Eurojust's replies

(2006/C 312/12)

CONTENTS

| 1-2 | INTRODUCTION |
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1-2

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

| 7-11 | OBSERVATIONS |
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7-11

Tables 1 to 4

Eurojust's replies

Eurojust's replies

INTRODUCTION

| 1. | Eurojust was set up by Council Decision 2002/187/JHA (1) with a view to stepping up the fight against serious organised crime. Its objective is to improve the coordination of investigations and prosecutions covering the territories of several Member States of the European Union, as well as that of non-member States. |
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1.

Eurojust was set up by Council Decision 2002/187/JHA (1) with a view to stepping up the fight against serious organised crime. Its objective is to improve the coordination of investigations and prosecutions covering the territories of several Member States of the European Union, as well as that of non-member States.

1

| 2. | Table 1 summarises Eurojust's competences and activities. Key information from the financial statements drawn up by Eurojust for the financial year 2005 is presented in Tables 2, 3 and 4. |
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2.

Table 1 summarises Eurojust's competences and activities. Key information from the financial statements drawn up by Eurojust for the financial year 2005 is presented in Tables 2, 3 and 4.

Table 1

Tables 2, 3 and 4

STATEMENT OF ASSURANCE

| 3. | This statement is addressed to the European Parliament and the Council pursuant to Article 36 of Decision 2002/187/JHA. |
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3.

This statement is addressed to the European Parliament and the Council pursuant to Article 36 of Decision 2002/187/JHA.

| 4. | Eurojust's accounts for the financial year ended 31 December 2005 (2) were drawn up by its Administrative Director, pursuant to Article 36 of Decision 2002/187/JHA, and sent to the Court, which is required to give a statement of assurance on their reliability and on the legality and regularity of the underlying transactions. |
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4.

Eurojust's accounts for the financial year ended 31 December 2005 (2) were drawn up by its Administrative Director, pursuant to Article 36 of Decision 2002/187/JHA, and sent to the Court, which is required to give a statement of assurance on their reliability and on the legality and regularity of the underlying transactions.

2

| 5. | The Court conducted an audit in accordance with its policies and standards, which are based on international auditing standards that have been adapted to the 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 an audit in accordance with its policies and standards, which are based on international auditing standards that have been adapted to the 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.

| 6. | The Court has thus obtained a reasonable basis for the statement expressed below. |
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6.

The Court has thus obtained a reasonable basis for the statement expressed below.

Reliability of the accountsEurojust's accounts for the financial year ended 31 December 2005 are, in all material respects, reliable.Legality and regularity of the underlying transactionsThe transactions underlying Eurojust'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 accountsEurojust's accounts for the financial year ended 31 December 2005 are, in all material respects, reliable.Legality and regularity of the underlying transactionsThe transactions underlying Eurojust'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. | A review of the implementation of the budget showed that 90 % of the appropriations granted for the year had been committed. The overall rate of payment against the year's commitments was 84 %. Nevertheless, the utilisation rate of appropriations for operating activities (Title III) was low: only 80 % of the commitment appropriations for the financial year were used and a third of commitments had to be carried over. For the same expenditure, more than 15 % of the commitments carried over to the year had to be cancelled. These findings suggest that a qualitative improvement in the programming of operating expenditure is needed in order to avoid mobilising resources unnecessarily. The College decided to authorise a non-automatic carryover of appropriations for a total of 285 484 euro. Such carryovers are permitted only if most of the stages preparatory to the act of commitment have been completed before the end of the financial year and this was not the case. |
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7.

A review of the implementation of the budget showed that 90 % of the appropriations granted for the year had been committed. The overall rate of payment against the year's commitments was 84 %. Nevertheless, the utilisation rate of appropriations for operating activities (Title III) was low: only 80 % of the commitment appropriations for the financial year were used and a third of commitments had to be carried over. For the same expenditure, more than 15 % of the commitments carried over to the year had to be cancelled. These findings suggest that a qualitative improvement in the programming of operating expenditure is needed in order to avoid mobilising resources unnecessarily. The College decided to authorise a non-automatic carryover of appropriations for a total of 285 484 euro. Such carryovers are permitted only if most of the stages preparatory to the act of commitment have been completed before the end of the financial year and this was not the case.

| 8. | Eurojust still does not have its own financial regulation and, this being the case, has continued to apply the framework financial regulation for the Community bodies (3). At the end of 2005, the Commission had still not issued an opinion concerning the draft regulation submitted by Eurojust in May of the same year. |
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8.

Eurojust still does not have its own financial regulation and, this being the case, has continued to apply the framework financial regulation for the Community bodies (3). At the end of 2005, the Commission had still not issued an opinion concerning the draft regulation submitted by Eurojust in May of the same year.

3

| 9. | The inventory of fixed assets is managed using a spreadsheet, which does not allow the integrity of the data to be guaranteed. Assets cannot always be traced because information about where they are located is lacking. No exhaustive physical inventory of fixed assets has been made since Eurojust was set up. |
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9.

The inventory of fixed assets is managed using a spreadsheet, which does not allow the integrity of the data to be guaranteed. Assets cannot always be traced because information about where they are located is lacking. No exhaustive physical inventory of fixed assets has been made since Eurojust was set up.

| 10. | The Management Board has still not adopted any internal control standards. Formalisation of operating and accounting procedures is mostly lacking. In 2005, the checklists describing the checks to be carried out on budgetary commitments relating to important operating procedures (procurement, and recruitment) were insufficiently developed. |
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10.

The Management Board has still not adopted any internal control standards. Formalisation of operating and accounting procedures is mostly lacking. In 2005, the checklists describing the checks to be carried out on budgetary commitments relating to important operating procedures (procurement, and recruitment) were insufficiently developed.

| 11. | Some anomalies were found in respect of public procurement procedures and contract management, in particular the absence of guidelines on the weightings applied to award criteria, and confusion between the selection criteria and the criteria for awarding contracts. Framework contracts have, moreover, exceeded the timelimits laid down in the regulatory provisions. |
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11.

Some anomalies were found in respect of public procurement procedures and contract management, in particular the absence of guidelines on the weightings applied to award criteria, and confusion between the selection criteria and the criteria for awarding contracts. Framework contracts have, moreover, exceeded the timelimits laid down in the regulatory provisions.

This report was adopted by the Court of Auditors in Luxembourg at its meeting of 28 September 2006.

For the Court of Auditors

Hubert WEBER

President

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(1)  Decision of 28 February 2002 setting up Eurojust (OJ L 63, 6.3.2002, p. 1).

1

(2)  These accounts were drawn up on 29 June 2006 and received by the Court on 7 July 2006.

2

(3)  Commission Regulation (EC, Euratom) No 2343/2002 of 23 December 2002 (OJ L 357, 31.12.2002, p. 72).

3

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Table 1

Eurojust (The Hague)

| Areas of competence stipulated in the Treaty on European Union | Eurojust's competences as defined in the Council Decision of 28 February 2002 (2002/187/JHA) | Governance | Resources made available to Eurojust 2005 (2004) | Activities and services provided 2005 (2004) |
| --- | --- | --- | --- | --- |
| Third pillar body created by Council Decision.
  The Union's objective is to provide citizens with a high level of safety within an area of freedom, security and justice.
  The Council encourages cooperation through Eurojust by enabling it to facilitate proper coordination between the Member States' national prosecuting authorities. (Articles 29 and 31)
  Eurojust's main areas of responsibility are the same as Europol's, i.e. the fight against terrorism, organised crime, in particular drug-trafficking, illegal immigration, illicit vehicle trafficking, trafficking in human beings, the counterfeiting of money, trafficking in radioactive substances, computer crime, acts detrimental to the Union's financial interests and money-laundering. | Objectives:


  Article 3


  Eurojust Decision







  — | to stimulate and improve the coordination, between the competent national authorities of the Member States, of investigations and prosecutions, |

Areas of competence stipulated in the Treaty on European Union

Eurojust's competences as defined in the Council Decision of 28 February 2002 (2002/187/JHA)

Governance

Resources made available to Eurojust 2005 (2004)

Activities and services provided 2005 (2004)

Third pillar body created by Council Decision.

The Union's objective is to provide citizens with a high level of safety within an area of freedom, security and justice.

The Council encourages cooperation through Eurojust by enabling it to facilitate proper coordination between the Member States' national prosecuting authorities. (Articles 29 and 31)

Eurojust's main areas of responsibility are the same as Europol's, i.e. the fight against terrorism, organised crime, in particular drug-trafficking, illegal immigration, illicit vehicle trafficking, trafficking in human beings, the counterfeiting of money, trafficking in radioactive substances, computer crime, acts detrimental to the Union's financial interests and money-laundering.

Objectives:

Article 3

Eurojust Decision

—

to stimulate and improve the coordination, between the competent national authorities of the Member States, of investigations and prosecutions,

| — | to improve cooperation, in particular by facilitating the exchange of information, mutual legal assistance and the implementation of extradition requests, |
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—

to improve cooperation, in particular by facilitating the exchange of information, mutual legal assistance and the implementation of extradition requests,

| — | to support the competent authorities of the Member States in order to render their investigations and prosecutions more effective, |
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—

to support the competent authorities of the Member States in order to render their investigations and prosecutions more effective,

| — | to provide support with procedures involving a Member State and a non-member State, |
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—

to provide support with procedures involving a Member State and a non-member State,

| — | to provide support with procedures involving a Member State and the Community. |
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—

to provide support with procedures involving a Member State and the Community.

Tasks:

Articles 5, 6 and 7

Eurojust Decision

To organise cooperation between the various national legal systems, Eurojust acts:

| — | through its national members, or |
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—

through its national members, or

| — | as a College. |
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—

as a College.

If the competent authorities of the Member State concerned decide not to respond to the requests which Eurojust has issued as a College, they notify Eurojust of their reasons.

1. The College is responsible for the organisation and operation of Eurojust.

2. The College is composed of national members seconded by each Member State in accordance with its legal system, being prosecutors, judges or police officers of equivalent competence.

3. The College elects its President from among the national members.

4. The Joint Supervisory Body checks the processing of personal data.

5. The Administrative Director is unanimously appointed by the College.

6. External audit: the European Court of Auditors.

7. Discharge is given by the Parliament on the Council's recommendation.

2005 final budget:

13 million euro (9,3 million euro)

Community subsidy: 100 % (100 %)

Staff as at 31 December 2005:

87 (76) posts listed in the establishment plan,

posts occupied: 70 (52)

+15 (13) other staff (2 seconded national experts, local staff, 13 employment-agency staff)

Total staff: 85 (65)

assigned to the following duties:

operational tasks: 31 (27)

administrative tasks: 41 (26)

mixed tasks 13 (12)

Number of meetings:

73 (52)

Bilateral cases:

462 (272)

Multilateral cases:

124 (109)

Total number of cases:

588 (381)

Fraud:

14 % (20 %)

Drug-trafficking:

16 % (20 %)

Terrorism:

3 % (7 %)

Murder:

5 % (7 %)

Smuggling:

not available %

Trafficking in human beings:

4 % (4 %)

Money-laundering:

6 % (7 %)

Other:

52 % (35 %)

Source: Information supplied by Eurojust.

EUROJUST

Source: Eurojust data — These tables summarise the data supplied by Eurojust in its annual accounts.

Table 2

Implementation of the budget for the financial year 2005

| (1000 euro) |
| --- |
| Revenue | Expenditure |
| Source of revenue | Revenue entered under the final budget for the financial year | Revenue received | Allocation of expenditure | Appropriations under the final budget | Appropriations carried over from the previous financial year | Appropriations for the current financial year and carried over from the previous financial year |
| final | committed | paid | carried over | cancelled | available | paid | cancelled | available | committed | paid | carried over | cancelled |
| Community subsidies | 13 000 | 13 000 | Title I
  Staff | 5 419 | 5 196 | 5 084 | 112 | 223 | 88 | 83 | 5 | 5 507 | 5 284 | 5 167 | 112 | 228 |
| Other revenue | | 8 | Title II
  Administration | 3 380 | 3 207 | 2 591 | 723 | 66 | 434 | 426 | 8 | 3 814 | 3 641 | 3 017 | 723 | 74 |
| | | | Title III
  Operating activities | 4 201 | 3 377 | 2 276 | 1 280 | 645 | 345 | 291 | 54 | 4 546 | 3 722 | 2 567 | 1 280 | 699 |
| Total | 13 000 | 13 008 | Total | 13 000 | 11 780 | 9 951 | 2 115 | 934 | 867 | 800 | 67 | 13 867 | 12 647 | 10 751 | 2 115 | 1 001 |

(1000 euro)

Revenue

Expenditure

Source of revenue

Revenue entered under the final budget for the financial year

Revenue received

Allocation of expenditure

Appropriations under the final budget

Appropriations carried over from the previous financial year

Appropriations for the current financial year and carried over from the previous financial year

final

committed

paid

carried over

cancelled

available

paid

cancelled

available

committed

paid

carried over

cancelled

Community subsidies

13 000

13 000

Title I

Staff

5 419

5 196

5 084

112

223

88

83

5

5 507

5 284

5 167

112

228

Other revenue

8

Title II

Administration

3 380

3 207

2 591

723

66

434

426

8

3 814

3 641

3 017

723

74

Title III

Operating activities

4 201

3 377

2 276

1 280

645

345

291

54

4 546

3 722

2 567

1 280

699

Total

13 000

13 008

Total

13 000

11 780

9 951

2 115

934

867

800

67

13 867

12 647

10 751

2 115

1 001

Table 3

Revenue and expenditure account for the financial year 2005 (1)

| (1000 euro) |
| --- |
| | 2005 |
| Operating revenue |
| Community subsidies | 11 991 |
| Other subsidies/revenue | 59 |
| Total (a) | 12 050 |
| Operating expenditure |
| Staff | 5 149 |
| Administration | 3 308 |
| Operating activities | 2 054 |
| Total (b) | 10 511 |
| Operating result (c = a – b) | 1 539 |
| Other income (d) | 0 |
| Other charges (e) | 3 |
| Economic result (f = c + d – e) | 1 536 |

(1000 euro)

2005

Operating revenue

Community subsidies

11 991

Other subsidies/revenue

59

Total (a)

12 050

Operating expenditure

Staff

5 149

Administration

3 308

Operating activities

2 054

Total (b)

10 511

Operating result (c = a – b)

1 539

Other income (d)

0

Other charges (e)

3

Economic result (f = c + d – e)

1 536

Table 4

Balance sheet at 31 December 2005 and 2004 (2)

| (1000 euro) |
| --- |
| | 2005 | 2004 |
| Assets |
| Fixed assets | 1 773 | 1 455 |
| Receivables | 159 | 152 |
| Cash and cash equivalents | 3 130 | 2 082 |
| Total | 5 062 | 3 689 |
| Liabilities |
| Accumulated surplus/deficit | 1 842 | 1 669 |
| Economic result for the year | 1 536 | 173 |
| Current liabilities | 1 684 | 1 847 |
| Total | 5 062 | 3 689 |

(1000 euro)

2005

2004

Assets

Fixed assets

1 773

1 455

Receivables

159

152

Cash and cash equivalents

3 130

2 082

Total

5 062

3 689

Liabilities

Accumulated surplus/deficit

1 842

1 669

Economic result for the year

1 536

173

Current liabilities

1 684

1 847

Total

5 062

3 689

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(1)  The figures for the financial year 2004 are not given because they are not comparable to the 2005 figures because of a change in the accounting methods used.

(2)  The data for the financial year 2004 have been restated to allow for comparison with those for 2005.

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EUROJUST'S REPLIES

| 7. | Eurojust would like to emphasize that its volume of activity depends heavily on the number of cases referred by the Member States. Therefore, the programming of allocation of its resources has a highly indicative and approximate character. Moreover, the allocation in December 2004 of 2 million euro for Eurojust's operational activities has had a negative impact on our level of execution on title 3.
  Eurojust will apply strictly the applicable regulation in its future decisions relating to the non-automatic carry-over procedure. |
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7.

Eurojust would like to emphasize that its volume of activity depends heavily on the number of cases referred by the Member States. Therefore, the programming of allocation of its resources has a highly indicative and approximate character. Moreover, the allocation in December 2004 of 2 million euro for Eurojust's operational activities has had a negative impact on our level of execution on title 3.

Eurojust will apply strictly the applicable regulation in its future decisions relating to the non-automatic carry-over procedure.

| 8. | The consultations with the Commission on Eurojust's draft financial regulation have been concluded and the agreed text has been adopted by the College on 20 April 2006. |
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8.

The consultations with the Commission on Eurojust's draft financial regulation have been concluded and the agreed text has been adopted by the College on 20 April 2006.

| 9. | Eurojust prioritised the setting up of an asset inventory system to meet the accounting obligations. An exhaustive inventory database is currently being implemented. |
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9.

Eurojust prioritised the setting up of an asset inventory system to meet the accounting obligations. An exhaustive inventory database is currently being implemented.

| 10. | The Authorising Officer has submitted standards of internal control based on the ones adopted by the Commission to the College of Eurojust for adoption during the last quarter of 2006.
  In 2006, on the basis of its experience, Eurojust has started to improve the checklists in use for its main budgetary operations. |
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10.

The Authorising Officer has submitted standards of internal control based on the ones adopted by the Commission to the College of Eurojust for adoption during the last quarter of 2006.

In 2006, on the basis of its experience, Eurojust has started to improve the checklists in use for its main budgetary operations.

| 11. | Eurojust has improved its tender procedures in view to make a clearer distinction between selection and award criteria. None of the contracts mentioned by the Court will be used after the permitted four-year period. |
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11.

Eurojust has improved its tender procedures in view to make a clearer distinction between selection and award criteria. None of the contracts mentioned by the Court will be used after the permitted four-year period.

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