# Official Journal C 324/2004

| | ISSN 1725-2423 |
| --- | --- |
| Official Journal
  of the European Union | C 324 |
| | |
| English edition | Information and Notices | Volume 4730 December 2004 |

ISSN 1725-2423

Official Journal

of the European Union

C 324

English edition

Information and Notices

Volume 4730 December 2004

---

| Notice No | Contents | page |
| --- | --- | --- |
| | I   Information |
| | Court of Auditors |
| 2004/C 324/1 | Report on the annual accounts of the European Agency for Safety and Health at Work for the 2003 financial year together with the Agency's replies | 1 |
| 2004/C 324/2 | Report on the annual accounts of the European Aviation Safety Agency for the 2003 financial year together with the Agency's replies | 9 |
| 2004/C 324/3 | Report on the annual accounts of the European Maritime Safety Agency for the 2003 financial year together with the Agency's replies | 16 |
| 2004/C 324/4 | Report on the annual accounts of the European Environment Agency for the 2003 financial year together with the Agency's replies | 23 |
| 2004/C 324/5 | Report on the annual accounts of the European Agency for the Evaluation of Medicinal Products concerning the 2003 financial year together with the Agency's replies | 30 |
| 2004/C 324/6 | Report on the annual accounts of the European Food Safety Authority for the 2003 financial year together with the Authority's replies | 39 |
| 2004/C 324/7 | Report on the annual accounts of the Translation Centre for the bodies of the European Union for the 2003 financial year together with the Centre's replies | 46 |
| 2004/C 324/8 | Report on the annual accounts of the European Centre for the Development of Vocational Training for the 2003 financial year together with the Centre's replies | 53 |
| 2004/C 324/9 | Report on the annual accounts of Eurojust for the 2003 financial year together with Eurojust's replies | 61 |
| 2004/C 324/0 | Report on the annual accounts of the European Training Foundation for the 2003 financial year together with the Foundation's replies | 68 |
| 2004/C 324/1 | Report on the financial statements of the European Foundation for the Improvement of Living and Working Conditions for the 2003 financial year together with the Foundation's replies | 75 |
| 2004/C 324/2 | Report on the annual accounts of the European Monitoring Centre for Drugs and Drug Addiction for the 2003 financial year together with the Monitoring Centre's replies | 83 |
| 2004/C 324/3 | Report on the annual accounts of the European Monitoring Centre on Racism and Xenophobia for the 2003 financial year together with the Monitoring Centre's replies | 91 |
| 2004/C 324/4 | Report on the annual accounts of the Community Plant Variety Office for the 2003 financial year together with the Office's replies | 99 |
| 2004/C 324/5 | Report on the annual accounts of the Office for Harmonization in the Internal Market for the 2003 financial year together with the Office's replies | 106 |

Notice No

Contents

page

I   Information

Court of Auditors

2004/C 324/1

Report on the annual accounts of the European Agency for Safety and Health at Work for the 2003 financial year together with the Agency's replies

1

2004/C 324/2

Report on the annual accounts of the European Aviation Safety Agency for the 2003 financial year together with the Agency's replies

9

2004/C 324/3

Report on the annual accounts of the European Maritime Safety Agency for the 2003 financial year together with the Agency's replies

16

2004/C 324/4

Report on the annual accounts of the European Environment Agency for the 2003 financial year together with the Agency's replies

23

2004/C 324/5

Report on the annual accounts of the European Agency for the Evaluation of Medicinal Products concerning the 2003 financial year together with the Agency's replies

30

2004/C 324/6

Report on the annual accounts of the European Food Safety Authority for the 2003 financial year together with the Authority's replies

39

2004/C 324/7

Report on the annual accounts of the Translation Centre for the bodies of the European Union for the 2003 financial year together with the Centre's replies

46

2004/C 324/8

Report on the annual accounts of the European Centre for the Development of Vocational Training for the 2003 financial year together with the Centre's replies

53

2004/C 324/9

Report on the annual accounts of Eurojust for the 2003 financial year together with Eurojust's replies

61

2004/C 324/0

Report on the annual accounts of the European Training Foundation for the 2003 financial year together with the Foundation's replies

68

2004/C 324/1

Report on the financial statements of the European Foundation for the Improvement of Living and Working Conditions for the 2003 financial year together with the Foundation's replies

75

2004/C 324/2

Report on the annual accounts of the European Monitoring Centre for Drugs and Drug Addiction for the 2003 financial year together with the Monitoring Centre's replies

83

2004/C 324/3

Report on the annual accounts of the European Monitoring Centre on Racism and Xenophobia for the 2003 financial year together with the Monitoring Centre's replies

91

2004/C 324/4

Report on the annual accounts of the Community Plant Variety Office for the 2003 financial year together with the Office's replies

99

2004/C 324/5

Report on the annual accounts of the Office for Harmonization in the Internal Market for the 2003 financial year together with the Office's replies

106

| EN | |
| --- | --- |

EN

---

I Information

Court of Auditors

| 30.12.2004 | EN | Official Journal of the European Union | C 324/1 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/1

---

REPORT

on the annual accounts of the European Agency for Safety and Health at Work for the 2003 financial year together with the Agency's replies

(2004/C 324/01)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-11 | OBSERVATIONS |
| --- | --- |

6-11

Tables 1-4

The Agency's replies

INTRODUCTION

| 1. | The European Agency for Safety and Health at Work (hereinafter referred to as the Agency) was established by Council Regulation (EC) No 2062/94 of 18 July 1994 (1). The Agency's task is to collect and disseminate information on national and Community priorities in the field of safety and health at work, to support national and Community organisations involved in the formulation and implementation of policy and to provide information on preventive measures. Table 1 contains a summary of the Agency's responsibilities and activities based on information provided by the Agency. |
| --- | --- |

1.

The European Agency for Safety and Health at Work (hereinafter referred to as the Agency) was established by Council Regulation (EC) No 2062/94 of 18 July 1994 (1). The Agency's task is to collect and disseminate information on national and Community priorities in the field of safety and health at work, to support national and Community organisations involved in the formulation and implementation of policy and to provide information on preventive measures. Table 1 contains a summary of the Agency's responsibilities and activities based on information provided by the Agency.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the Agency’s annual accounts for the financial year ended 31 December 2003. In accordance with Article 14(1) of Council Regulation (EC) No 2062/94, the budget was implemented on the responsibility of the Director. This responsibility included the drawing-up and presentation of the accounts (3) in accordance with the internal financial rules provided for under Article 15 of Council Regulation (EC) No 2062/94. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the Agency’s annual accounts for the financial year ended 31 December 2003. In accordance with Article 14(1) of Council Regulation (EC) No 2062/94, the budget was implemented on the responsibility of the Director. This responsibility included the drawing-up and presentation of the accounts (3) in accordance with the internal financial rules provided for under Article 15 of Council Regulation (EC) No 2062/94. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in this context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in this context.

| 5. | The Court thus obtained reasonable assurance that the annual accounts for the financial year ended on 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report. |
| --- | --- |

5.

The Court thus obtained reasonable assurance that the annual accounts for the financial year ended on 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2. The revenue and expenditure account and balance sheet drawn up by the Agency for 2003 are set out in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2. The revenue and expenditure account and balance sheet drawn up by the Agency for 2003 are set out in summary form in Tables 3 and 4.

| 7. | The carry-overs of appropriations mainly concern Title III of the budget and, despite a significant reduction, represent more than 45 % of the commitments entered into. The Court once again draws the Agency’s attention to the necessity of improving the monitoring of its activities. |
| --- | --- |

7.

The carry-overs of appropriations mainly concern Title III of the budget and, despite a significant reduction, represent more than 45 % of the commitments entered into. The Court once again draws the Agency’s attention to the necessity of improving the monitoring of its activities.

| 8. | For the financial year ending on 31 December 2003 the Agency began to apply the accounting principles set out in its new financial regulation. Nevertheless, the data concerning the financial year 2002 were not reprocessed, so it is not possible to compare the two financial years. |
| --- | --- |

8.

For the financial year ending on 31 December 2003 the Agency began to apply the accounting principles set out in its new financial regulation. Nevertheless, the data concerning the financial year 2002 were not reprocessed, so it is not possible to compare the two financial years.

| 9. | In its report concerning the financial year 2002 (4), the Court noted shortcomings in checks on a programme of subsidies for the collation and dissemination of good practices to reduce the risks to health and safety in small and medium-sized enterprises. In 2003 the Agency paid 3,1 million euro on the basis of an analysis of the activity reports and financial reports concerning 53 projects under this programme. The declarations of expenditure of 20 of these projects were audited by the Court. As the date of the end of the programme approached, the Agency reduced its demands in terms of financial documentation in support of requests for final payment. The result was that, in the case of five of the 20 files examined, payments had been made to the extent of 348 000 euro on the basis of nothing more than a declaration of expenditure, without adequate supporting documents and in some cases with none (5). In its reply to the Court's report concerning the financial year 2002 (6), the Agency was examining the possibility of carrying out checks at project holder level. No such check was carried out in 2003. |
| --- | --- |

9.

In its report concerning the financial year 2002 (4), the Court noted shortcomings in checks on a programme of subsidies for the collation and dissemination of good practices to reduce the risks to health and safety in small and medium-sized enterprises. In 2003 the Agency paid 3,1 million euro on the basis of an analysis of the activity reports and financial reports concerning 53 projects under this programme. The declarations of expenditure of 20 of these projects were audited by the Court. As the date of the end of the programme approached, the Agency reduced its demands in terms of financial documentation in support of requests for final payment. The result was that, in the case of five of the 20 files examined, payments had been made to the extent of 348 000 euro on the basis of nothing more than a declaration of expenditure, without adequate supporting documents and in some cases with none (5). In its reply to the Court's report concerning the financial year 2002 (6), the Agency was examining the possibility of carrying out checks at project holder level. No such check was carried out in 2003.

| 10. | As the Court pointed out in its opinion on the financial year 2002 (7), the audit of the budgetary accounts again revealed shortcomings in the definition of ex ante financial checks and the relevant formal procedures. |
| --- | --- |

10.

As the Court pointed out in its opinion on the financial year 2002 (7), the audit of the budgetary accounts again revealed shortcomings in the definition of ex ante financial checks and the relevant formal procedures.

| 11. | According to Article 4 of the Agency's basic regulation, the national authorities are to inform the Agency of the names of the institutions with which the Agency is able to cooperate and which can act as topic centres. The Agency has financed two centres (8) which cover a large range of topics. One of them cooperates with 14 institutions and the other with 12. The main added value of the studies carried out by the centres is the fact that they collect data which are sometimes difficult to obtain and analyse at European level. The Agency should strengthen its system for checking expenditure declared by topic centres, in particular by asking for them to be certified by an external auditor. |
| --- | --- |

11.

According to Article 4 of the Agency's basic regulation, the national authorities are to inform the Agency of the names of the institutions with which the Agency is able to cooperate and which can act as topic centres. The Agency has financed two centres (8) which cover a large range of topics. One of them cooperates with 14 institutions and the other with 12. The main added value of the studies carried out by the centres is the fact that they collect data which are sometimes difficult to obtain and analyse at European level. The Agency should strengthen its system for checking expenditure declared by topic centres, in particular by asking for them to be certified by an external auditor.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 216, 20.8.1994, p. 1. The Regulation was amended by Council Regulation (EC) No 1654/2003 of 18 June 2003 (OJ L 245, 29.9.2003, p. 38).

1

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

2

(3)  In accordance with Article 14(3) of the Agency's Financial Regulation, the final accounts for the financial year 2003 were drawn up on 27 July 2004 and forwarded to the Court of Auditors, which received them on 24 September 2004. A short form of these accounts is presented in the tables annexed to this report.

3

(4)  See paragraph 12 of the report concerning the financial year 2002 (OJ C 319, 30.12.2003, p. 10).

4

(5)  In four cases, no supporting document was attached to the request and in one case the supporting documents covered only part of the amount requested.

5

(6)  See paragraph 13 of the reply to the report concerning the financial year 2002 (OJ C 319, 30.12.2003, p. 14).

6

(7)  See paragraph 9 of the report concerning the financial year 2002 (OJ C 319, 30.12.2003, p. 9).

7

(8)  A third centre was set up in June 2003 solely for the collection of data in the candidate countries; this centre ceased operations in April 2004.

8

---

Table 1

European Agency for Safety and Health at Work (Bilbao)

| Areas of Community competence according to the Treaty | The Agency's competences as defined by Council Regulation
  (EC) No 2062/94 of 18 July 1994 | Governance | Funds placed at the Agency's disposal in 2003 (data for 2002) | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| Social Provisions

  The Community and the Member States (...) shall have as their objectives (...) improved living and working conditions, so as to make possible their harmonisation while the improvement is being maintained (...).
  With a view to achieving the objectives of Article 136, the Community shall support and complement the activities of the Member States in the following fields:






  (a) | improvement in particular of the working environment to protect workers' health and safety; |

Areas of Community competence according to the Treaty

The Agency's competences as defined by Council Regulation

(EC) No 2062/94 of 18 July 1994

Governance

Funds placed at the Agency's disposal in 2003 (data for 2002)

Products and services supplied in 2003

Social Provisions

The Community and the Member States (...) shall have as their objectives (...) improved living and working conditions, so as to make possible their harmonisation while the improvement is being maintained (...).

With a view to achieving the objectives of Article 136, the Community shall support and complement the activities of the Member States in the following fields:

(a)

improvement in particular of the working environment to protect workers' health and safety;

| (b) | working conditions. (...) |
| --- | --- |

(b)

working conditions. (...)

(Extracts from Articles 136 and 137 of the Treaty)

Objectives

| — | To provide the Community bodies, the Member States and those involved in the field with information of use in the field of safety and health at work in order to encourage improvements, especially in the working environment, as regards the protection of the safety and health of workers. |
| --- | --- |

—

To provide the Community bodies, the Member States and those involved in the field with information of use in the field of safety and health at work in order to encourage improvements, especially in the working environment, as regards the protection of the safety and health of workers.

Tasks

| — | To collect and disseminate information on national and Community priorities and on research |
| --- | --- |

—

To collect and disseminate information on national and Community priorities and on research

| — | to promote cooperation and the exchange of information, including information on training programmes |
| --- | --- |

—

to promote cooperation and the exchange of information, including information on training programmes

| — | to supply the Community bodies and the Member States with information they require to formulate and implement policies, in particular as regards the impact on small and medium-sized enterprises |
| --- | --- |

—

to supply the Community bodies and the Member States with information they require to formulate and implement policies, in particular as regards the impact on small and medium-sized enterprises

| — | to make available information from and to third countries and international organisations |
| --- | --- |

—

to make available information from and to third countries and international organisations

| — | to provide information on preventive activities |
| --- | --- |

—

to provide information on preventive activities

| — | to contribute to the development of future Community action programmes |
| --- | --- |

—

to contribute to the development of future Community action programmes

| — | to set up a network comprising national focal points and topic centres. |
| --- | --- |

—

to set up a network comprising national focal points and topic centres.

| 1. | Administrative Board

  Composition






  — | One representative of each Member State |
| --- | --- | --- |

1.

Administrative Board

—

One representative of each Member State

| — | One representative of the employers' organisations of each Member State |
| --- | --- |

—

One representative of the employers' organisations of each Member State

| — | One representative of the employees' organisations of each Member State |
| --- | --- |

—

One representative of the employees' organisations of each Member State

| — | Three representatives of the Commission |
| --- | --- |

—

Three representatives of the Commission

| — | To adopt the Agency's work programme and annual general report |
| --- | --- |

—

To adopt the Agency's work programme and annual general report

| 2. | The Director







  — | Appointed by the Administrative Board on a proposal from the Commission |
| --- | --- | --- |

2.

The Director

—

Appointed by the Administrative Board on a proposal from the Commission

| 3. | Committees

  Obligatory consultation of the Commission and the Advisory Committee on Safety, Hygiene and Protection at Work in respect of the work programme |
| --- | --- |

3.

Committees

Obligatory consultation of the Commission and the Advisory Committee on Safety, Hygiene and Protection at Work in respect of the work programme

| 4. | External audit

  Court of Auditors |
| --- | --- |

4.

External audit

Court of Auditors

| 5. | Discharge authority

  Parliament on a recommendation by the Council |
| --- | --- |

5.

Discharge authority

Parliament on a recommendation by the Council

Final budget:

14,6 million euro (13,2 million euro)

including:

| — | Community subsidy, Employment DG: 91,58 % (98,41 %) |
| --- | --- |

—

Community subsidy, Employment DG: 91,58 % (98,41 %)

| — | Community subsidy, Enlargement DG: 7,19 % (0 %) |
| --- | --- |

—

Community subsidy, Enlargement DG: 7,19 % (0 %)

| — | miscellaneous revenue: 1,23 % (1,59 %) |
| --- | --- |

—

miscellaneous revenue: 1,23 % (1,59 %)

Staff as at 31 December 2003:

33 (31) posts in the establishment plan,

of which, posts filled: 29 (29)

25 (21) other posts (auxiliary contracts, seconded national experts, local staff, temporary staff)

Total staff: 54 (50)

Of these, number carrying out

operational tasks: 34 (32)

administrative tasks: 12 (9)

assorted tasks: 8 (9)

Development of the network

Approximately 600 partners associated with national focal points, nine expert groups, three topic centres, participation of PHARE and EFTA countries

Dissemination of information

European Week for Safety and Health at work: ‘dangerous substances’;

| — | Participation in 58 exhibitions/conferences, |
| --- | --- |

—

Participation in 58 exhibitions/conferences,

| — | Electronic media: twice-weekly newsletter to 20 000 subscribers, website (1,7 million visitors) |
| --- | --- |

—

Electronic media: twice-weekly newsletter to 20 000 subscribers, website (1,7 million visitors)

| — | Publications: 9 information reports and working documents, 11 fact sheets, 1 issue of the ‘Forum’ magazine, 3 newsletters — paper version, 19 press releases |
| --- | --- |

—

Publications: 9 information reports and working documents, 11 fact sheets, 1 issue of the ‘Forum’ magazine, 3 newsletters — paper version, 19 press releases

Third programme for SMEs (2003 to 2004): 40 projects selected

Second programme for SMEs (2002 to 2003): 51 projects finalised

Source:information supplied by the Agency.

Table 2

European Agency for Safety and Health at Work — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Source of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Expenditure allocation | Appropriations in the final budget | Appropriations carried over from the previous financial year | Available appropriations
  (2003 budget and financial year 2002) |
| entered | committed | paid | carried over | cancelled | outstanding appropriations | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 13,4 | 11,6 | Title I
  Staff | 3,7 | 3,5 | 3,2 | 0,1 | 0,4 | 0,1 | 0,1 | 0,1 | 3,9 | 3,5 | 3,3 | 0,1 | 0,5 |
| Own revenue | 0,0 | 0,0 | Title II
  Administration | 1,4 | 1,4 | 1,1 | 0,2 | 0,0 | 0,2 | 0,2 | 0,1 | 1,6 | 1,4 | 1,3 | 0,2 | 0,1 |
| Other subsidies | 0,2 | 0,1 | Title III
  Operating activities | 8,5 | 8,3 | 2,6 | 5,9 | 0,0 | 5,8 | 5,2 | 0,6 | 14,3 | 8,3 | 7,8 | 5,9 | 0,6 |
| Other revenue | p.m. | 0,2 | Phare expenditure | 1,1 | 1,0 | 0,5 | 0,5 | 0,0 | 0,0 | 0,0 | 0,0 | 1,1 | 1,0 | 0,5 | 0,5 | 0,0 |
| Phare revenue | 1,1 | 0,8 | | | | | | | | | | | | | | |
| Total | 14,6 | 12,7 | Total | 14,6 | 14,1 | 7,5 | 6,6 | 0,5 | 6,2 | 5,5 | 0,8 | 20,8 | 14,1 | 13,0 | 6,6 | 1,2 |
| N.B.:Differences in totals are due to the effects of rounding.

  Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts. |

(million euro)

Revenue

Expenditure

Source of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Expenditure allocation

Appropriations in the final budget

Appropriations carried over from the previous financial year

Available appropriations

(2003 budget and financial year 2002)

entered

committed

paid

carried over

cancelled

outstanding appropriations

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies

13,4

11,6

Title I

Staff

3,7

3,5

3,2

0,1

0,4

0,1

0,1

0,1

3,9

3,5

3,3

0,1

0,5

Own revenue

0,0

0,0

Title II

Administration

1,4

1,4

1,1

0,2

0,0

0,2

0,2

0,1

1,6

1,4

1,3

0,2

0,1

Other subsidies

0,2

0,1

Title III

Operating activities

8,5

8,3

2,6

5,9

0,0

5,8

5,2

0,6

14,3

8,3

7,8

5,9

0,6

Other revenue

p.m.

0,2

Phare expenditure

1,1

1,0

0,5

0,5

0,0

0,0

0,0

0,0

1,1

1,0

0,5

0,5

0,0

Phare revenue

1,1

0,8

Total

14,6

12,7

Total

14,6

14,1

7,5

6,6

0,5

6,2

5,5

0,8

20,8

14,1

13,0

6,6

1,2

N.B.:Differences in totals are due to the effects of rounding.

Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts.

Table 3

European Agency for Safety and Health at Work — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Community subsidies | 11 641 | 12 324 |
| Other subsidies | 66 | 252 |
| Other revenue | 157 | 81 |
| PHARE revenue | 824 | 0 |
| Total revenue (a) | 12 688 | 12 657 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 3 245 | 3 024 |
| Appropriations carried over | 87 | 136 |
| Administration — Title II of the budget |
| Payments | 1 146 | 1 140 |
| Appropriations carried over | 186 | 247 |
| Operating activities — Title III of the budget |
| Payments | 2 559 | 2 030 |
| Appropriations carried over | 5 859 | 5 623 |
| PHARE expenditure |
| Payments | 548 | 0 |
| Appropriations carried over | 502 | 0 |
| Total expenditure (b) | 14 131 | 12 199 |
| Outturn for the financial year (c = a – b) (1) | –1 443 | 458 |
| Balance carried over from the previous financial year | –1 108 | –2 185 |
| Appropriations carried over from the previous financial year and cancelled | 766 | 609 |
| Sums to be re-used carried over from the previous financial year and not used | 1 | 0 |
| Payments against commitment cancelled in 2002 | – 191 | 0 |
| Exchange-rate differences | 4 | 4 |
| Adjustment entries | –16 | 7 |
| Outturn for the financial year before economic adjustment (d) | –1 987 | –1 108 |
| Budget revenue to be recovered | 850 | 0 |
| Other revenue to be recovered | 3 | 0 |
| Acquisitions of fixed assets | 207 | 0 |
| Depreciation (2) | – 186 | 0 |
| Miscellaneous expenditure | –1 | 0 |
| Economic adjustments (e) | 873 | 0 |
| Balance for the financial year (d + e) (3) | –1 113 | –1 108 |
| NB:Differences in totals are due to the effects of rounding.

  Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts. |

(1000 euro)

2003

2002

Revenue

Community subsidies

11 641

12 324

Other subsidies

66

252

Other revenue

157

81

PHARE revenue

824

0

Total revenue (a)

12 688

12 657

Expenditure

Staff — Title I of the budget

Payments

3 245

3 024

Appropriations carried over

87

136

Administration — Title II of the budget

Payments

1 146

1 140

Appropriations carried over

186

247

Operating activities — Title III of the budget

Payments

2 559

2 030

Appropriations carried over

5 859

5 623

PHARE expenditure

Payments

548

0

Appropriations carried over

502

0

Total expenditure (b)

14 131

12 199

Outturn for the financial year (c = a – b) (1)

–1 443

458

Balance carried over from the previous financial year

–1 108

–2 185

Appropriations carried over from the previous financial year and cancelled

766

609

Sums to be re-used carried over from the previous financial year and not used

1

0

Payments against commitment cancelled in 2002

– 191

0

Exchange-rate differences

4

4

Adjustment entries

–16

7

Outturn for the financial year before economic adjustment (d)

–1 987

–1 108

Budget revenue to be recovered

850

0

Other revenue to be recovered

3

0

Acquisitions of fixed assets

207

0

Depreciation (2)

– 186

0

Miscellaneous expenditure

–1

0

Economic adjustments (e)

873

0

Balance for the financial year (d + e) (3)

–1 113

–1 108

NB:Differences in totals are due to the effects of rounding.

Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts.

Table 4

European Agency for Safety and Health at Work — Balance sheet at 31 December 2003 and 31 December 2002

| (million euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets | | | Own capital | | |
| Computer software | 95 | 145 | Own capital (4) | 431 | 1 229 |
| IT equipment | 136 | 428 | Balance for the financial year | –1 113 | –1 108 |
| Fittings and furniture | 215 | 614 | Subtotal | – 682 | 121 |
| Transportation equipment | 0 | 26 | Medium and long-term liabilities | | |
| Subtotal | 445 | 1 214 | Liabilities against assigned revenue | 0 | 369 |
| Medium and long-term assets | | | Subtotal | 0 | 369 |
| Community subsidies | 0 | 369 | Current liabilities | | |
| Subtotal | 0 | 369 | Non-automatic carry-overs | 135 | 193 |
| Stocks | | | Automatic carry-overs | 6 498 | 5 813 |
| Office supplies | 6 | 15 | Commission | 282 | 7 |
| Subtotal | 6 | 15 | Sundry accounts payable | 128 | 19 |
| Current assets | | | Payroll deductions | 73 | 24 |
| Community subsidies | 1 035 | 681 | Liabilities against assigned revenue | 0 | 736 |
| Sundry accounts receivable | 62 | 53 | Subtotal | 7 117 | 6 791 |
| Recoverable VAT | 0 | 5 | Suspense accounts | | |
| Subtotal | 1 097 | 739 | Recovery orders | 11 | 21 |
| Cash accounts | | | Revenue for re-use | 0 | 17 |
| Bank and cash | 4 889 | 4 922 | Subtotal | 11 | 37 |
| Imprest account | 1 | 61 | | | |
| Subtotal | 4 890 | 4 982 | | | |
| Suspense accounts | | | | | |
| Advances | 6 | 0 | | | |
| Subtotal | 6 | 0 | | | |
| Total | 6 445 | 7 319 | Total | 6 445 | 7 319 |
| NB:Differences in totals are due to the effects of rounding.

  Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts. |

(million euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets

Own capital

Computer software

95

145

Own capital (4)

431

1 229

IT equipment

136

428

Balance for the financial year

–1 113

–1 108

Fittings and furniture

215

614

Subtotal

– 682

121

Transportation equipment

0

26

Medium and long-term liabilities

Subtotal

445

1 214

Liabilities against assigned revenue

0

369

Medium and long-term assets

Subtotal

0

369

Community subsidies

0

369

Current liabilities

Subtotal

0

369

Non-automatic carry-overs

135

193

Stocks

Automatic carry-overs

6 498

5 813

Office supplies

6

15

Commission

282

7

Subtotal

6

15

Sundry accounts payable

128

19

Current assets

Payroll deductions

73

24

Community subsidies

1 035

681

Liabilities against assigned revenue

0

736

Sundry accounts receivable

62

53

Subtotal

7 117

6 791

Recoverable VAT

0

5

Suspense accounts

Subtotal

1 097

739

Recovery orders

11

21

Cash accounts

Revenue for re-use

0

17

Bank and cash

4 889

4 922

Subtotal

11

37

Imprest account

1

61

Subtotal

4 890

4 982

Suspense accounts

Advances

6

0

Subtotal

6

0

Total

6 445

7 319

Total

6 445

7 319

NB:Differences in totals are due to the effects of rounding.

Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts.

---

(1)  Calculation according to the principles of Article 15 of Council Regulation (EC, Euratom) No 1150/2000 of 22 May 2000 (OJ L 130, 31.5.2000, p. 8).

(2)  In 2003 the Agency depreciated its fixed assets for the first time.

(3)  The negative balance is due to the fact that carry-overs are still being treated as expenditure, without any economic adjustment. A rough estimate of the adjustment to be applied suggests that the actual balance for the financial year is of the order of a million euro.

NB:Differences in totals are due to the effects of rounding.

Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts.

(4)  The total for capital at 31 December 2003 corresponds to the sum of the gross value of fixed assets at 31 December 2002 minus historical depreciation for the period 1996 to 2002 plus the variation in the value of stock between 31.12.2002 and 31.12.2003 and adjustments on the valuation, recognition and downgrading of fixed assets. The depreciation for 2003 has been included in the result for the year and therefore has not been deducted directly from capital.

NB:Differences in totals are due to the effects of rounding.

Source:The Agency's data — The tables present, in summary form, the data provided by the Agency in its own accounts.

---

THE AGENCY'S REPLIESS

| 7. | The Agency would like to confirm its continuous commitment towards reducing the amount of carry-overs in line with the principle of annuality of the budget. Compared with 2002, the Agency has significantly reduced carry-overs in 2003 (from 60 to 45 %). As in 2002 carry-overs are mainly due to the proper implementation of the SME funding scheme, which has a clear two-years implementation cycle. |
| --- | --- |

7.

The Agency would like to confirm its continuous commitment towards reducing the amount of carry-overs in line with the principle of annuality of the budget. Compared with 2002, the Agency has significantly reduced carry-overs in 2003 (from 60 to 45 %). As in 2002 carry-overs are mainly due to the proper implementation of the SME funding scheme, which has a clear two-years implementation cycle.

| 8. | Following various meetings between the Commission and the Accountants of all Agencies, it was decided that the withdrawal of credits carried over at the end of the year, required the use of specific IT tools, which were not available but are now being developed by the Agency. |
| --- | --- |

8.

Following various meetings between the Commission and the Accountants of all Agencies, it was decided that the withdrawal of credits carried over at the end of the year, required the use of specific IT tools, which were not available but are now being developed by the Agency.

| 9. | Concerning the projects of the SME programme, the Agency did not pay the full grant to more than half of the project holders and six recovery orders were issued, following the internal assessment by Agency staff of the activity and financial reports and supporting documents provided by the 53 beneficiaries. The difference between the total amount foreseen and the total grant amount paid was EUR 382 377. The Agency would highlight that additional information provided by four of the five project holders mentioned by the Court, at the request of the Agency after the auditors’ visit, confirmed the information provided earlier in the financial statement, and no adjustment was required. The fifth project holder provided some of the requested information justifying the total payment of EUR 11 000. In 2004, the Agency commissioned a contractor to carry out five ex post financial audits, including on-site inspections of the SME project holders’ accounts. The final reports are due in October 2004 moreover, an independent evaluation of the first two SME schemes has concluded to the sustainability and the added value of the awarded projects as well as sound management of the schemes. |
| --- | --- |

9.

Concerning the projects of the SME programme, the Agency did not pay the full grant to more than half of the project holders and six recovery orders were issued, following the internal assessment by Agency staff of the activity and financial reports and supporting documents provided by the 53 beneficiaries. The difference between the total amount foreseen and the total grant amount paid was EUR 382 377. The Agency would highlight that additional information provided by four of the five project holders mentioned by the Court, at the request of the Agency after the auditors’ visit, confirmed the information provided earlier in the financial statement, and no adjustment was required. The fifth project holder provided some of the requested information justifying the total payment of EUR 11 000. In 2004, the Agency commissioned a contractor to carry out five ex post financial audits, including on-site inspections of the SME project holders’ accounts. The final reports are due in October 2004 moreover, an independent evaluation of the first two SME schemes has concluded to the sustainability and the added value of the awarded projects as well as sound management of the schemes.

| 10. | The Agency notes the comments of the Court of Auditors. At the end of 2003, the internal restructuring of the Resource and Service Centre was completed, all operations are now subject to an ex ante verification check (operational and financial aspects). |
| --- | --- |

10.

The Agency notes the comments of the Court of Auditors. At the end of 2003, the internal restructuring of the Resource and Service Centre was completed, all operations are now subject to an ex ante verification check (operational and financial aspects).

| 11. | The Agency wishes to note that, in order to reinforce the control of expenditures, all contracts signed from September 2003 onwards with the Topic Centres include a clause by which the beneficiary will carry out an external audit of the use of the funds made available by the grant agreement. The auditors shall produce their professional opinion, the purpose of the audit being to certify that the financial documents submitted to the Agency by the beneficiary comply with the financial provisions of the agreement, that the costs declared are the actual costs and that all receipts have been declared. |
| --- | --- |

11.

The Agency wishes to note that, in order to reinforce the control of expenditures, all contracts signed from September 2003 onwards with the Topic Centres include a clause by which the beneficiary will carry out an external audit of the use of the funds made available by the grant agreement. The auditors shall produce their professional opinion, the purpose of the audit being to certify that the financial documents submitted to the Agency by the beneficiary comply with the financial provisions of the agreement, that the costs declared are the actual costs and that all receipts have been declared.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/9 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/9

---

REPORT

on the annual accounts of the European Aviation Safety Agency for the 2003 financial year together with the Agency's replies

(2004/C 324/02)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-10 | OBSERVATIONS |
| --- | --- |

6-10

Tables 1-4

The Agency's replies

INTRODUCTION

| 1. | The European Aviation Safety Agency (hereinafter called the Agency) was established by Council Regulation (EC) No 1592/2002 of 15 July 2002 (1). The 2003 financial year was the first in which the Agency actually began to carry out its operational activities. The Agency's tasks are to maintain a high level of civil aviation safety, to ensure the proper functioning and development of civil aviation safety, to establish certification specifications and to provide certification of aeronautical products. Table 1 summarises the powers and activities of the Agency on the basis of information supplied by it. |
| --- | --- |

1.

The European Aviation Safety Agency (hereinafter called the Agency) was established by Council Regulation (EC) No 1592/2002 of 15 July 2002 (1). The 2003 financial year was the first in which the Agency actually began to carry out its operational activities. The Agency's tasks are to maintain a high level of civil aviation safety, to ensure the proper functioning and development of civil aviation safety, to establish certification specifications and to provide certification of aeronautical products. Table 1 summarises the powers and activities of the Agency on the basis of information supplied by it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the annual accounts of the Agency for the financial year ended 31 December 2003. In accordance with Article 49(1) of Council Regulation (EC) No 1592/2002 of 15 July 2002, the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted on the basis of Article 52 of the same Regulation. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of the Agency for the financial year ended 31 December 2003. In accordance with Article 49(1) of Council Regulation (EC) No 1592/2002 of 15 July 2002, the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted on the basis of Article 52 of the same Regulation. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in this context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in this context.

| 5. | The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003 is set out in Table 2. The Agency's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003 is set out in Table 2. The Agency's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4.

| 7. | The Executive Director, who is the authorising officer, is also empowered to sign banking instructions. This is contrary to Article 37 of the Agency's financial regulation. |
| --- | --- |

7.

The Executive Director, who is the authorising officer, is also empowered to sign banking instructions. This is contrary to Article 37 of the Agency's financial regulation.

| 8. | Article 43(1)(e) of the Agency's financial regulation stipulates that the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. This validation did not take place during the financial year. |
| --- | --- |

8.

Article 43(1)(e) of the Agency's financial regulation stipulates that the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. This validation did not take place during the financial year.

| 9. | An examination of the recruitment files revealed that they contained formal deficiencies and that some documents were missing. In view of the scale of recruitment forecast between now and 2006 (around 300 persons), steps must be taken to ensure improved compliance with the regulatory provisions. |
| --- | --- |

9.

An examination of the recruitment files revealed that they contained formal deficiencies and that some documents were missing. In view of the scale of recruitment forecast between now and 2006 (around 300 persons), steps must be taken to ensure improved compliance with the regulatory provisions.

| 10. | An analysis of the computer system control environment showed that it requires strengthening in advance of the forecast increase in the Agency's activities. |
| --- | --- |

10.

An analysis of the computer system control environment showed that it requires strengthening in advance of the forecast increase in the Agency's activities.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 240, 7.9.2002, p. 1.

1

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

2

(3)  As required by Article 83(3) of the Agency's financial regulation, the final accounts for the 2003 financial year were drawn up on 31 March 2004 and forwarded to the Court of Auditors, which received them on 20 September 2004. A summarised version of these accounts is presented in the tables annexed to this report.

3

---

Table 1

European Aviation Safety Agency (temporary headquarters in Brussels, planned relocation to Cologne)

| Areas of Community competence deriving from the Treaty | Competence of the Agency
  (Council Regulation (EC) No 1592/2002 of 15 July 2002) | Governance | Resources available to the Agency in 2003 | Products and services supplied during the financial year 2003 |
| --- | --- | --- | --- | --- |
| Common transport policy

  ‘The Council may, acting by a qualified majority, decide whether, to what extent and by what procedure appropriate provisions may be laid down for sea and air transport.’

  (Article 80 of the Treaty) | Objectives

  To maintain a high uniform level of civil aviation safety in Europe
  To ensure the proper functioning and development of civil aviation safety
  To facilitate the free movement of goods, persons and services
  To promote cost-efficiency in the regulatory and certification processes and to avoid duplication at national and European level | Tasks







  — | To issue opinions addressed to the Commission |

Areas of Community competence deriving from the Treaty

Competence of the Agency

(Council Regulation (EC) No 1592/2002 of 15 July 2002)

Governance

Resources available to the Agency in 2003

Products and services supplied during the financial year 2003

Common transport policy

‘The Council may, acting by a qualified majority, decide whether, to what extent and by what procedure appropriate provisions may be laid down for sea and air transport.’

(Article 80 of the Treaty)

Objectives

To maintain a high uniform level of civil aviation safety in Europe

To ensure the proper functioning and development of civil aviation safety

To facilitate the free movement of goods, persons and services

To promote cost-efficiency in the regulatory and certification processes and to avoid duplication at national and European level

Tasks

—

To issue opinions addressed to the Commission

| — | To issue certification specifications and any guidance material for the application of Community policy |
| --- | --- |

—

To issue certification specifications and any guidance material for the application of Community policy

| — | To provide airworthiness and environmental certification of aeronautical products |
| --- | --- |

—

To provide airworthiness and environmental certification of aeronautical products

| — | To conduct inspections in Member States concerning compliance with the rules of civil aviation safety as laid down by the Agency |
| --- | --- |

—

To conduct inspections in Member States concerning compliance with the rules of civil aviation safety as laid down by the Agency

| — | To conduct the necessary investigations at undertakings |
| --- | --- |

—

To conduct the necessary investigations at undertakings

| — | To carry out, on behalf of Member States, functions and tasks ascribed to them by applicable international Conventions, in particular the Chicago Convention (Convention on International Civil Aviation, signed on 7 December 1944) |
| --- | --- |

—

To carry out, on behalf of Member States, functions and tasks ascribed to them by applicable international Conventions, in particular the Chicago Convention (Convention on International Civil Aviation, signed on 7 December 1944)

| 1 | Management Board

  Composition
  One representative of each Member State and one representative of the Commission
  Duties






  — | To adopt the work programme and oversee its implementation |
| --- | --- | --- |

1

Management Board

One representative of each Member State and one representative of the Commission

—

To adopt the work programme and oversee its implementation

| — | To adopt guidelines for the allocation of certification tasks to Member States or qualified entities |
| --- | --- |

—

To adopt guidelines for the allocation of certification tasks to Member States or qualified entities

| — | To establish an advisory body of interested parties |
| --- | --- |

—

To establish an advisory body of interested parties

| 2 | Executive Director

  Appointed by the Management Board at the proposal of the Commission |
| --- | --- |

2

Executive Director

Appointed by the Management Board at the proposal of the Commission

| 3 | Boards of Appeal |
| --- | --- |

3

Boards of Appeal

| 4 | External audit

  The European Court of Auditors |
| --- | --- |

4

External audit

The European Court of Auditors

| 5 | Discharge authority

  Parliament, on the Council's recommendation |
| --- | --- |

5

Discharge authority

Parliament, on the Council's recommendation

Final budget

4,75 million euro. Community contribution: 100 %

Staff numbers as at 31 December 2003:

Number of posts in establishment plan: 80

Posts occupied: 1

Other staff: 16 (auxiliary contracts)

Total staff: 17

Assigned to the following duties:

operational: 1

administrative: 4

mixed: 12

Number of opinions delivered: 2

Number of specifications and guidance documents: 19

Certification decisions:2 132 (1 606 relating to minor modifications)

Inspections: none

Investigations: none

Source:Information provided by the Agency.

Table 2

European Aviation Safety Agency — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Allocation of expenditure | Final budget appropriations |
| entered | committed | paid | carried over | cancelled |
| Community subsidies | 4,7 | 3,7 | Title I
  Staff | 0,9 | 0,7 | 0,7 | 0,0 | 0,2 |
| Other subsidies | — | — | Title II
  Administration | 0,8 | 0,5 | 0,1 | 0,4 | 0,3 |
| Other revenues | — | — | Title III
  Operating expenditure | 3,0 | 2,7 | 0,2 | 2,5 | 0,3 |
| Total | 4,7 | 3,7 | Total | 4,7 | 3,9 | 1,0 | 2,9 | 0,8 |
| Source:Data from the Agency — These tables summarise the data supplied by the Agency in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Allocation of expenditure

Final budget appropriations

entered

committed

paid

carried over

cancelled

Community subsidies

4,7

3,7

Title I

Staff

0,9

0,7

0,7

0,0

0,2

Other subsidies

—

—

Title II

Administration

0,8

0,5

0,1

0,4

0,3

Other revenues

—

—

Title III

Operating expenditure

3,0

2,7

0,2

2,5

0,3

Total

4,7

3,7

Total

4,7

3,9

1,0

2,9

0,8

Source:Data from the Agency — These tables summarise the data supplied by the Agency in its own accounts.

Table 3

European Aviation Safety Agency — Revenue and expenditure account for the 2003 financial year

| (1000 euro) |
| --- |
| | 2003 |
| Revenue |
| Commission subsidies | 3 725 |
| Total revenue (a) | 3 725 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 680 |
| Appropriations carried over | 27 |
| Administration — Title II of the budget |
| Payments | 153 |
| Appropriations carried over | 396 |
| Operating expenditure — Title III of the budget |
| Payments | 197 |
| Appropriations carried over | 2 486 |
| Total expenditure (b) | 3 939 |
| Outturn for the financial year (a – b) | – 214 |
| Source:Data from the Agency. |

(1000 euro)

2003

Revenue

Commission subsidies

3 725

Total revenue (a)

3 725

Expenditure

Staff — Title I of the budget

Payments

680

Appropriations carried over

27

Administration — Title II of the budget

Payments

153

Appropriations carried over

396

Operating expenditure — Title III of the budget

Payments

197

Appropriations carried over

2 486

Total expenditure (b)

3 939

Outturn for the financial year (a – b)

– 214

Source:Data from the Agency.

Table 4

European Aviation Safety Agency — Balance sheet as at 31 December 2003

| (1000 euro) |
| --- |
| Assets | 2003 | Liabilities | 2003 |
| Fixed assets | | Fixed capital | |
| Intangible assets | 10 | Own capital | 16 |
| Computer software | 11 | Balance for the financial year | – 214 |
| Depreciation | –5 | Subtotal | – 198 |
| Subtotal | 16 | Current liabilities | |
| Current assets | | Commission | 8 |
| Other advances | 5 | Automatic carry-overs of appropriations | 2 909 |
| Sundry accounts receivable | 1 | Sundry accounts payable | 18 |
| Subtotal | 6 | Deductions from salaries | 12 |
| Cash accounts | | Subtotal | 2 947 |
| Bank accounts and cash | 2 727 | | |
| Subtotal | 2 727 | | |
| Total | 2 749 | Total | 2 749 |
| Source:Data from the Agency. |

(1000 euro)

Assets

2003

Liabilities

2003

Fixed assets

Fixed capital

Intangible assets

10

Own capital

16

Computer software

11

Balance for the financial year

– 214

Depreciation

–5

Subtotal

– 198

Subtotal

16

Current liabilities

Current assets

Commission

8

Other advances

5

Automatic carry-overs of appropriations

2 909

Sundry accounts receivable

1

Sundry accounts payable

18

Subtotal

6

Deductions from salaries

12

Cash accounts

Subtotal

2 947

Bank accounts and cash

2 727

Subtotal

2 727

Total

2 749

Total

2 749

Source:Data from the Agency.

---

THE AGENCY'S REPLIES

| 7. | Until the end of 2003, the Executive Director was the Agency’s only temporary staff member. In practice, he signed banking transactions alongside the accountant. Other temporary staff have been hired during the second half of 2004, eliminating this incompatibility. |
| --- | --- |

7.

Until the end of 2003, the Executive Director was the Agency’s only temporary staff member. In practice, he signed banking transactions alongside the accountant. Other temporary staff have been hired during the second half of 2004, eliminating this incompatibility.

| 8. | The financial systems were validated by the accountant at the beginning of February 2004. A computer system for managing fixed assets, to be implemented by the authorising officer, is currently being acquired and will be validated at a later stage. |
| --- | --- |

8.

The financial systems were validated by the accountant at the beginning of February 2004. A computer system for managing fixed assets, to be implemented by the authorising officer, is currently being acquired and will be validated at a later stage.

| 9. | The shortcomings identified by the Court are related to the fact that the Agency was in its start-up phase. A Human Resources department with a special recruitment unit was set up in February 2004. It has already implemented procedures and tools. The Agency is considering setting up a computerised recruitment management system as of January 2005. |
| --- | --- |

9.

The shortcomings identified by the Court are related to the fact that the Agency was in its start-up phase. A Human Resources department with a special recruitment unit was set up in February 2004. It has already implemented procedures and tools. The Agency is considering setting up a computerised recruitment management system as of January 2005.

| 10. | The fact that the Agency is based on the premises of the Commission has had a major impact on its IT environment. The Agency will move to its new premises in Cologne in November 2004, which will lead to a considerable improvement in its IT environment and the implementation of a new computer architecture. |
| --- | --- |

10.

The fact that the Agency is based on the premises of the Commission has had a major impact on its IT environment. The Agency will move to its new premises in Cologne in November 2004, which will lead to a considerable improvement in its IT environment and the implementation of a new computer architecture.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/16 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/16

---

REPORT

on the annual accounts of the European Maritime Safety Agency for the 2003 financial year together with the Agency's replies

(2004/C 324/03)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-10 | OBSERVATIONS |
| --- | --- |

6-10

Tables 1-4

The Agency's replies

INTRODUCTION

| 1. | The European Maritime Safety Agency (hereinafter called the Agency) was established by Regulation (EC) No 1406/2002 (1) of the European Parliament and of the Council of 27 June 2002. The financial year 2003 was the first one during which the Agency actually began to carry out its operational activities. The Agency's tasks are to ensure a high level of maritime safety and prevention of pollution by ships, to provide the Commission and the Member States with technical assistance, to monitor the implementation of the relevant Community legislation and to evaluate its effectiveness. Table 1 summarises the powers and activities of the Agency on the basis of information supplied by it. |
| --- | --- |

1.

The European Maritime Safety Agency (hereinafter called the Agency) was established by Regulation (EC) No 1406/2002 (1) of the European Parliament and of the Council of 27 June 2002. The financial year 2003 was the first one during which the Agency actually began to carry out its operational activities. The Agency's tasks are to ensure a high level of maritime safety and prevention of pollution by ships, to provide the Commission and the Member States with technical assistance, to monitor the implementation of the relevant Community legislation and to evaluate its effectiveness. Table 1 summarises the powers and activities of the Agency on the basis of information supplied by it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the Agency's annual accounts for the financial year ended 31 December 2003. In accordance with Article 19(1) of Regulation (EC) No 1406/2002, the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the financial statements (3) in accordance with the internal financial provisions adopted on the basis of Article 21 of Council Regulation (EC) No 1406/2002. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the Agency's annual accounts for the financial year ended 31 December 2003. In accordance with Article 19(1) of Regulation (EC) No 1406/2002, the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the financial statements (3) in accordance with the internal financial provisions adopted on the basis of Article 21 of Council Regulation (EC) No 1406/2002. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures that it considered necessary in that context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures that it considered necessary in that context.

| 5. | The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this respect into question. |
| --- | --- |

5.

The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this respect into question.

OBSERVATIONS

| 6. | Table 2 shows the implementation of appropriations for the financial year 2003. The Agency's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4. |
| --- | --- |

6.

Table 2 shows the implementation of appropriations for the financial year 2003. The Agency's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4.

| 7. | The Executive Director, who is the authorising officer, is also empowered to sign banking instructions, which is contrary to Article 37 of the Agency's financial regulation. |
| --- | --- |

7.

The Executive Director, who is the authorising officer, is also empowered to sign banking instructions, which is contrary to Article 37 of the Agency's financial regulation.

| 8. | Article 43(1)(e) of the Agency's financial regulation stipulates that the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. This validation has yet to be formalised. |
| --- | --- |

8.

Article 43(1)(e) of the Agency's financial regulation stipulates that the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. This validation has yet to be formalised.

| 9. | The Agency should carry out systematic checks on salary payments made to its employees. |
| --- | --- |

9.

The Agency should carry out systematic checks on salary payments made to its employees.

| 10. | An analysis of the computer system control environment showed that it requires strengthening in view of the forecast increase in the Agency's activities. |
| --- | --- |

10.

An analysis of the computer system control environment showed that it requires strengthening in view of the forecast increase in the Agency's activities.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 201, 31.7.2002, p. 8.

1

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

2

(3)  As required by Article 82 of Commission Regulation (EC) No 2343/2002, the final accounts for all Agency revenue and expenditure for the financial year 2003 were drawn up on 1 March 2004 and forwarded to the Court of Auditors, which received them on 20 September 2004. A summarised version of these accounts is presented in the tables attached to this report.

3

---

Table 1

European Maritime Safety Agency (temporary headquarters in Brussels, planned relocation to Lisbon)

| Areas of Community competence deriving from the Treaty | Competence of the Agency
  (European Parliament and Council Regulation (EC) No 1406/2002 of 27 June 2002) | Organisation | Resources made available to the Agency in 2003 | Products and services supplied during the financial year 2003 (1) |
| --- | --- | --- | --- | --- |
| Common transport policy

  The Council may, acting by a qualified majority, decide whether, to what extent and by what procedure appropriate provisions may be laid down for sea and air transport.

  (Article 80 of the Treaty) | Objectives







  — | To ensure a high, uniform and effective level of maritime safety and prevention of pollution by ships |

Areas of Community competence deriving from the Treaty

Competence of the Agency

(European Parliament and Council Regulation (EC) No 1406/2002 of 27 June 2002)

Organisation

Resources made available to the Agency in 2003

Products and services supplied during the financial year 2003 (1)

Common transport policy

The Council may, acting by a qualified majority, decide whether, to what extent and by what procedure appropriate provisions may be laid down for sea and air transport.

(Article 80 of the Treaty)

Objectives

—

To ensure a high, uniform and effective level of maritime safety and prevention of pollution by ships

| — | To provide the Member States and the Commission with technical and scientific assistance |
| --- | --- |

—

To provide the Member States and the Commission with technical and scientific assistance

| — | To monitor the implementation of the relevant Community legislation and to evaluate the effectiveness of the measures in place. |
| --- | --- |

—

To monitor the implementation of the relevant Community legislation and to evaluate the effectiveness of the measures in place.

Tasks

| — | To assist the Commission with the development and implementation of Community legislation |
| --- | --- |

—

To assist the Commission with the development and implementation of Community legislation

| — | To monitor the functioning of the Community port State control regime, including visits to the Member States |
| --- | --- |

—

To monitor the functioning of the Community port State control regime, including visits to the Member States

| — | To provide the Commission with technical assistance for the port State control of ships |
| --- | --- |

—

To provide the Commission with technical assistance for the port State control of ships

| — | To work with the Member States to develop technical solutions and provide technical assistance related to the implementation of Community legislation |
| --- | --- |

—

To work with the Member States to develop technical solutions and provide technical assistance related to the implementation of Community legislation

| — | To promote cooperation between riparian States in the shipping areas concerned |
| --- | --- |

—

To promote cooperation between riparian States in the shipping areas concerned

| — | To develop any necessary information system |
| --- | --- |

—

To develop any necessary information system

| — | To facilitate cooperation between the Member States and the Commission in the development of a common methodology for investigating accidents |
| --- | --- |

—

To facilitate cooperation between the Member States and the Commission in the development of a common methodology for investigating accidents

| — | To provide the Commission and the Member States with reliable information on maritime safety and on pollution by ships |
| --- | --- |

—

To provide the Commission and the Member States with reliable information on maritime safety and on pollution by ships

| — | To assist the Commission and the Member States in the identification and pursuit of ships making unlawful discharges. |
| --- | --- |

—

To assist the Commission and the Member States in the identification and pursuit of ships making unlawful discharges.

| 1. | Administrative Board

  Composition
  One representative of each Member State, four representatives of the Commission and four representatives, without the right to vote, from the professional sectors concerned.
  Duties
  To adopt the budget and the work programme
  To examine requests from Member States for assistance |
| --- | --- |

1.

Administrative Board

One representative of each Member State, four representatives of the Commission and four representatives, without the right to vote, from the professional sectors concerned.

To adopt the budget and the work programme

To examine requests from Member States for assistance

| 2. | Executive Director

  Appointed by the Administrative Board at the proposal of the Commission |
| --- | --- |

2.

Executive Director

Appointed by the Administrative Board at the proposal of the Commission

| 3. | External audit

  European Court of Auditors |
| --- | --- |

3.

External audit

European Court of Auditors

| 4. | Discharge authority

  Parliament, on the Council's recommendation |
| --- | --- |

4.

Discharge authority

Parliament, on the Council's recommendation

Final budget:

4,5 million euro. Community contribution: 100 %

Staff numbers as at 31 December 2003:

Data not provided

Number of opinions delivered: 2

Inspections: 4

Source:Information supplied by the Agency.

Table 2

European Maritime Safety Agency — Implementation of the budget for the 2003 financial year

| (1000 euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Allocation of expenditure | Final budget appropriations |
| entered | committed | paid | carried over | cancelled |
| Community subsidies | 4 500 | 2 630 | Title I
  Staff | 1 552 | 713 | 647 | 66 | 838 |
| Other subsidies | | 2 | Title II
  Administration | 848 | 553 | 238 | 315 | 295 |
| | | | Title III
  Operating expenditure | 230 | 167 | 13 | 155 | 63 |
| Total | 4 500 | 2 632 | Total | 2 630 | 1 434 | 898 | 536 | 1 196 |
| NB:Totals may include differences due to rounding.

  Source:Data from the Agency. These tables summarise the data supplied by the Agency in its own acounts. |

(1000 euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Allocation of expenditure

Final budget appropriations

entered

committed

paid

carried over

cancelled

Community subsidies

4 500

2 630

Title I

Staff

1 552

713

647

66

838

Other subsidies

2

Title II

Administration

848

553

238

315

295

Title III

Operating expenditure

230

167

13

155

63

Total

4 500

2 632

Total

2 630

1 434

898

536

1 196

NB:Totals may include differences due to rounding.

Source:Data from the Agency. These tables summarise the data supplied by the Agency in its own acounts.

Table 3

European Maritime Safety Agency — Revenue and expenditure account for the 2003 financial year

| (1000 euro |
| --- |
| | 2003 |
| Revenue |
| Commission subsidies | 2 630 |
| Other revenue | 2 |
| Total revenue (a) | 2 632 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 647 |
| Appropriations carried over | 66 |
| Administration — Title II of the budget |
| Payments | 238 |
| Appropriations carried over | 315 |
| Operating expenditure — Title III of the budget |
| Payments | 13 |
| Appropriations carried over | 155 |
| Total expenditure (b) | 1 434 |
| Outturn for the financial year (a – b) | 1 198 |
| NB:Totals may include differences due to rounding.

  Source:Data from the Agency. |

(1000 euro

2003

Revenue

Commission subsidies

2 630

Other revenue

2

Total revenue (a)

2 632

Expenditure

Staff — Title I of the budget

Payments

647

Appropriations carried over

66

Administration — Title II of the budget

Payments

238

Appropriations carried over

315

Operating expenditure — Title III of the budget

Payments

13

Appropriations carried over

155

Total expenditure (b)

1 434

Outturn for the financial year (a – b)

1 198

NB:Totals may include differences due to rounding.

Source:Data from the Agency.

Table 4

European Maritime Safety Agency — Balance sheet as at 31 December 2003

| (1000 euro) |
| --- |
| Assets | 2003 | Liabilities | 2003 |
| Fixed assets | | Own capital | |
| Computer software | 11 | Own capital | 8 |
| Depreciation | –3 | Balance for the financial year | 1 198 |
| Subtotal | 8 | Subtotal | 1 206 |
| Current assets | | Current liabilities | |
| Advances to staff | 17 | Automatic carry-overs of appropriations | 536 |
| Sundry accounts receivable | 3 | Sundry accounts payable | 29 |
| Subtotal | 20 | Subtotal | 566 |
| Cash accounts | | | |
| Bank accounts | 1 744 | | |
| Subtotal | 1 744 | | |
| Total | 1 772 | Total | 1 772 |
| NB:Totals may include differences due to rounding.

  Source:Data from the Agency. |

(1000 euro)

Assets

2003

Liabilities

2003

Fixed assets

Own capital

Computer software

11

Own capital

8

Depreciation

–3

Balance for the financial year

1 198

Subtotal

8

Subtotal

1 206

Current assets

Current liabilities

Advances to staff

17

Automatic carry-overs of appropriations

536

Sundry accounts receivable

3

Sundry accounts payable

29

Subtotal

20

Subtotal

566

Cash accounts

Bank accounts

1 744

Subtotal

1 744

Total

1 772

Total

1 772

NB:Totals may include differences due to rounding.

Source:Data from the Agency.

---

(1)  The Agency was only able to begin operations in November 2003.

Source:Information supplied by the Agency.

---

THE AGENCY'S REPLIES

| 7. | It was not possible to ensure the separation of duties due to the Agency’s insufficient human resources. Since January 2004, following the recruitment of other members of staff, internal controls have been strengthened and the separation of duties ensured. |
| --- | --- |

7.

It was not possible to ensure the separation of duties due to the Agency’s insufficient human resources. Since January 2004, following the recruitment of other members of staff, internal controls have been strengthened and the separation of duties ensured.

| 8. | Further to the Court’s observations, the accounting officer validated the accounting and budgetary systems in March 2004. |
| --- | --- |

8.

Further to the Court’s observations, the accounting officer validated the accounting and budgetary systems in March 2004.

| 9. | The Commission’s Paymaster's Office (PMO) is in charge of calculating EMSA employee salaries. Following an increase in staff numbers in the Human Resources department, checks on payments have been strengthened. |
| --- | --- |

9.

The Commission’s Paymaster's Office (PMO) is in charge of calculating EMSA employee salaries. Following an increase in staff numbers in the Human Resources department, checks on payments have been strengthened.

| 10. | The Agency has strengthened its IT team considerably, and staff numbers should increase from one (end 2003) to five (end 2004). This will allow for a better division of tasks and responsibilities and thus improve control of the computer system. |
| --- | --- |

10.

The Agency has strengthened its IT team considerably, and staff numbers should increase from one (end 2003) to five (end 2004). This will allow for a better division of tasks and responsibilities and thus improve control of the computer system.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/23 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/23

---

REPORT

on the annual accounts of the European Environment Agency for the 2003 financial year together with the Agency's replies

(2004/C 324/04)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-8 | OBSERVATIONS |
| --- | --- |

6-8

Tables 1 to 4

The Agency's replies

INTRODUCTION

| 1. | The European Environment Agency (hereinafter called the Agency) was established by Council Regulation (EEC) No 1210/90 of 7 May 1990 (1). It is responsible for setting up an observation network that provides the Commission, the Member States and, more generally, the public with reliable information on the state of the environment. The information should, in particular, enable the European Union and the Member States to take action to safeguard the environment and assess the effectiveness of such action. Table 1 summarises the Agency's competencies and activities on the basis of information it has forwarded. |
| --- | --- |

1.

The European Environment Agency (hereinafter called the Agency) was established by Council Regulation (EEC) No 1210/90 of 7 May 1990 (1). It is responsible for setting up an observation network that provides the Commission, the Member States and, more generally, the public with reliable information on the state of the environment. The information should, in particular, enable the European Union and the Member States to take action to safeguard the environment and assess the effectiveness of such action. Table 1 summarises the Agency's competencies and activities on the basis of information it has forwarded.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the annual accounts of the Agency for the financial year ended 31 December 2003. In accordance with Article 13 of Council Regulation (EEC) No 1210/90, the budget was implemented on the responsibility of the Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions adopted on the basis of Article 14 of Council Regulation (EEC) No 1210/90. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of the Agency for the financial year ended 31 December 2003. In accordance with Article 13 of Council Regulation (EEC) No 1210/90, the budget was implemented on the responsibility of the Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions adopted on the basis of Article 14 of Council Regulation (EEC) No 1210/90. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. The Court carried out such tests on the accounting records and applied such other procedures as it deemed necessary in the circumstances. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. The Court carried out such tests on the accounting records and applied such other procedures as it deemed necessary in the circumstances.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2
   (4). The Agency's revenue and expenditure account and balance sheet for the 2003 financial year are presented in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2
   (4). The Agency's revenue and expenditure account and balance sheet for the 2003 financial year are presented in summary form in Tables 3 and 4.

| 7. | Contrary to the provisions of the Agency's financial regulation (5), recovery orders are not issued on a systematic basis when claims are established. This was the case for claims amounting to 2 539 000 euro, 1 472 000 euro of which had already been collected. |
| --- | --- |

7.

Contrary to the provisions of the Agency's financial regulation (5), recovery orders are not issued on a systematic basis when claims are established. This was the case for claims amounting to 2 539 000 euro, 1 472 000 euro of which had already been collected.

| 8. | The statements for the Agency's seven bank accounts were not reconciled with the corresponding balances in the accounts during the course of 2003. Reconciliation should be carried out monthly and the details forwarded to the responsible person in the administration. |
| --- | --- |

8.

The statements for the Agency's seven bank accounts were not reconciled with the corresponding balances in the accounts during the course of 2003. Reconciliation should be carried out monthly and the details forwarded to the responsible person in the administration.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 120, 11.5.1990.

1

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

2

(3)  As required under Article 13(3) of Council Regulation (EEC) No 1210/90, the final accounts of all the Agency's revenue and expenditure for the financial year 2003 were drawn up on 6 August 2004 and were sent to the Court of Auditors. They were received by the Court on 22 September 2004. A summary version of these accounts is presented in the tables annexed to this report.

3

(4)  All the tables in this report have been drawn up on the basis of the most accurate values possible for the data used. The totals may include minimal differences due to rounding for the purposes of presentation. A dash indicates a non-existent or zero value and 0,0 indicates a value below the rounding threshold.

4

(5)  Article 53(2).

5

---

Table 1

European Environment Agency (Copenhagen)

| Areas of Community competence deriving from the Treaty | Competencies of the Agency as defined in Council Regulation (EEC) No 1210/90 of 7 May 1990 | Governance | Resources made available to the Agency (2002 data) | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| Policy on the environment

  Community policy on the environment aims at a high level of protection, taking into account the diversity of situations in the various regions of the Community. It is based on the precautionary principle and on the principles that preventive action should be taken, that environmental damage should as a priority be rectified at source and that the polluter should pay. (...) In preparing its policy (...) the Community takes account of available scientific and technical data (...)

  (Article 174 of the Treaty) | Objectives

  To set up a European environment observation network to provide the Community and the Member States with reliable information so that they are able to:






  (a) | take the requisite action to protect the environment |

Areas of Community competence deriving from the Treaty

Competencies of the Agency as defined in Council Regulation (EEC) No 1210/90 of 7 May 1990

Governance

Resources made available to the Agency (2002 data)

Products and services supplied in 2003

Policy on the environment

Community policy on the environment aims at a high level of protection, taking into account the diversity of situations in the various regions of the Community. It is based on the precautionary principle and on the principles that preventive action should be taken, that environmental damage should as a priority be rectified at source and that the polluter should pay. (...) In preparing its policy (...) the Community takes account of available scientific and technical data (...)

(Article 174 of the Treaty)

Objectives

To set up a European environment observation network to provide the Community and the Member States with reliable information so that they are able to:

(a)

take the requisite action to protect the environment

| (b) | evaluate its implementation |
| --- | --- |

(b)

evaluate its implementation

| (c) | ensure that the public is well-informed about the state of the environment. |
| --- | --- |

(c)

ensure that the public is well-informed about the state of the environment.

Tasks

| — | To supply the Community and the Member States with the requisite information |
| --- | --- |

—

To supply the Community and the Member States with the requisite information

| — | To record and evaluate data on the state of the environment and to report on its quality |
| --- | --- |

—

To record and evaluate data on the state of the environment and to report on its quality

| — | To ensure that environmental data are comparable at European level |
| --- | --- |

—

To ensure that environmental data are comparable at European level

| — | To promote the incorporation of European environment information into international programmes |
| --- | --- |

—

To promote the incorporation of European environment information into international programmes

| — | To publish a report every five years on the state of, changes in and outlook for the environment |
| --- | --- |

—

To publish a report every five years on the state of, changes in and outlook for the environment

| — | To encourage the development of environment forecasting techniques, as well as methods for evaluating the cost of damage caused to the environment, and the exchange of information concerning damage-prevention technology |
| --- | --- |

—

To encourage the development of environment forecasting techniques, as well as methods for evaluating the cost of damage caused to the environment, and the exchange of information concerning damage-prevention technology

| 1. | Management Board

  Composition






  — | One representative per Member State |
| --- | --- | --- |

1.

Management Board

—

One representative per Member State

| — | Two representatives of the Commission |
| --- | --- |

—

Two representatives of the Commission

| — | Two scientists appointed by the European Parliament |
| --- | --- |

—

Two scientists appointed by the European Parliament

To adopt the work programme and ensure that it is implemented

| 2. | Director

  Appointed by the Management Board on the Commission's proposal |
| --- | --- |

2.

Director

Appointed by the Management Board on the Commission's proposal

| 3. | Advisory Forum

  Made up of one representative per Member State; advises the Executive Director |
| --- | --- |

3.

Advisory Forum

Made up of one representative per Member State; advises the Executive Director

| 4. | Scientific Committee

  Made up of persons qualified in the environmental field who are appointed by the Management Board |
| --- | --- |

4.

Scientific Committee

Made up of persons qualified in the environmental field who are appointed by the Management Board

| 5. | External audit

  Court of Auditors |
| --- | --- |

5.

External audit

Court of Auditors

| 6. | Discharge authority

  Parliament, on the Council's recommendation |
| --- | --- |

6.

Discharge authority

Parliament, on the Council's recommendation

Final budget

27,5 million euro

(25,1 million euro), Community contribution: 77 % (76 %)

Staff numbers as at 31 December 2003

Number of posts in establishment plan: 111 (106)

Posts occupied: 95 (85)

+16 (26) other staff (auxiliary contracts, seconded national experts, local staff, temporary staff)

Total staff: 111 (111)

assigned to the following duties:

operational: 69 (69)

administrative: 41 (41)

mixed: 1 (1)

| — | Support work and provision of indicators for the Synthesis report on sustainable development |
| --- | --- |

—

Support work and provision of indicators for the Synthesis report on sustainable development

| — | Indicators concerning the state of the environment in 2003 |
| --- | --- |

—

Indicators concerning the state of the environment in 2003

| — | Analysis and estimation of greenhouse gas emissions (1990 to 2020) |
| --- | --- |

—

Analysis and estimation of greenhouse gas emissions (1990 to 2020)

| — | Finalisation of the Kiev report (state of the environment in candidate Central and Eastern European countries) |
| --- | --- |

—

Finalisation of the Kiev report (state of the environment in candidate Central and Eastern European countries)

| — | Three seminars organised under the Greek Presidency of the Council |
| --- | --- |

—

Three seminars organised under the Greek Presidency of the Council

| — | Provision of environmental indicators in specific fields (transport sector in candidate countries, Danube region — Black Sea) |
| --- | --- |

—

Provision of environmental indicators in specific fields (transport sector in candidate countries, Danube region — Black Sea)

| — | Assistance in harmonising data |
| --- | --- |

—

Assistance in harmonising data

| — | Management of the EIONET network (European Environment Information and Observation Network) |
| --- | --- |

—

Management of the EIONET network (European Environment Information and Observation Network)

Source:Information supplied by the Agency.

Table 2

European Environment Agency — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Expenditure allocation | Appropriations under the final budget | Appropriations carried over from the previous financial year | Available appropriations
  (2003 budget and financial year 2002) |
| entered | committed | paid | carried over | cancelled | entered | committed | paid | to be carried over | cancelled | available | committed | paid | carried over | cancelled |
| Community subsidies | 21,4 | 21,4 | Title I
  Staff | 11,5 | 11,5 | 11,1 | 0,3 | 0,1 | 1,4 | 1,4 | 0,8 | 0,3 | 0,3 | 13,0 | 13,0 | 11,9 | 0,7 | 0,4 |
| Other subsidies | 6,1 | 8,4 | Title II
  Administration | 2,9 | 2,8 | 2,4 | 0,4 | 0,0 | 0,3 | 0,2 | 0,2 | 0,0 | 0,1 | 3,1 | 3,1 | 2,6 | 0,4 | 0,1 |
| Other revenue | 0,0 | 0,1 | Title III
  Operating activities | 13,1 | 13,0 | 6,0 | 7,0 | 0,1 | 5,9 | 5,6 | 4,9 | 0,8 | 0,3 | 19,0 | 18,6 | 10,9 | 7,8 | 0,4 |
| Total | 27,5 | 29,9 | Total | 27,5 | 27,4 | 19,6 | 7,7 | 0,2 | 7,6 | 7,3 | 5,8 | 1,1 | 0,6 | 35,1 | 34,6 | 25,4 | 8,9 | 0,9 |
| NB:The totals may contain differences due to the effects of rounding.

  Source:Information supplied by the Agency. These tables summarise the data provided by the Agency in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Expenditure allocation

Appropriations under the final budget

Appropriations carried over from the previous financial year

Available appropriations

(2003 budget and financial year 2002)

entered

committed

paid

carried over

cancelled

entered

committed

paid

to be carried over

cancelled

available

committed

paid

carried over

cancelled

Community subsidies

21,4

21,4

Title I

Staff

11,5

11,5

11,1

0,3

0,1

1,4

1,4

0,8

0,3

0,3

13,0

13,0

11,9

0,7

0,4

Other subsidies

6,1

8,4

Title II

Administration

2,9

2,8

2,4

0,4

0,0

0,3

0,2

0,2

0,0

0,1

3,1

3,1

2,6

0,4

0,1

Other revenue

0,0

0,1

Title III

Operating activities

13,1

13,0

6,0

7,0

0,1

5,9

5,6

4,9

0,8

0,3

19,0

18,6

10,9

7,8

0,4

Total

27,5

29,9

Total

27,5

27,4

19,6

7,7

0,2

7,6

7,3

5,8

1,1

0,6

35,1

34,6

25,4

8,9

0,9

NB:The totals may contain differences due to the effects of rounding.

Source:Information supplied by the Agency. These tables summarise the data provided by the Agency in its own accounts.

Table 3

European Environment Agency — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Community subsidies | 21 380 | 18 749 |
| Other subsidies | 8 423 | 1 136 |
| Other revenue | 89 | 198 |
| Total revenue (a) | 29 891 | 20 083 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 11 123 | 9 714 |
| Appropriations carried over | 315 | 1 018 |
| Administration — Title II of the budget |
| Payments | 2 447 | 2 054 |
| Appropriations carried over | 395 | 247 |
| Operating activities — Title III of the budget |
| Payments | 5 997 | 6 493 |
| Appropriations carried over | 7 008 | 5 611 |
| Total expenditure (b) | 27 284 | 25 136 |
| Outturn for the financial year (a – b) | 2 607 | –5 053 |
| Balance carried over from the previous financial year | –7 427 | –3 275 |
| Appropriations carried over and cancelled | 617 | 889 |
| Sums for re-use from the previous financial year not used | 36 | 8 |
| Exchange-rate differences | –4 | 4 |
| Adjustments | –18 | 0 |
| Balance for the financial year | –4 190 | –7 427 |
| NB:The totals may include differences due to rounding.

  Source:Information supplied by the Agency. These tables summarise the data provided by the Agency in its own accounts. |

(1000 euro)

2003

2002

Revenue

Community subsidies

21 380

18 749

Other subsidies

8 423

1 136

Other revenue

89

198

Total revenue (a)

29 891

20 083

Expenditure

Staff — Title I of the budget

Payments

11 123

9 714

Appropriations carried over

315

1 018

Administration — Title II of the budget

Payments

2 447

2 054

Appropriations carried over

395

247

Operating activities — Title III of the budget

Payments

5 997

6 493

Appropriations carried over

7 008

5 611

Total expenditure (b)

27 284

25 136

Outturn for the financial year (a – b)

2 607

–5 053

Balance carried over from the previous financial year

–7 427

–3 275

Appropriations carried over and cancelled

617

889

Sums for re-use from the previous financial year not used

36

8

Exchange-rate differences

–4

4

Adjustments

–18

0

Balance for the financial year

–4 190

–7 427

NB:The totals may include differences due to rounding.

Source:Information supplied by the Agency. These tables summarise the data provided by the Agency in its own accounts.

Table 4

European Environment Agency — Balance sheet at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets | | | Own capital | | |
| Computer equipment | 1 366 | 1 847 | Own capital | 1 265 | 1 295 |
| Equipment and furniture | 2 302 | 2 254 | Balance for the financial year | –4 190 | –7 427 |
| Financial fixed assets | 425 | 405 | Subtotal | –2 925 | –6 133 |
| Depreciation | –2 860 | –3 237 | Current liabilities | | |
| Subtotal | 1 232 | 1 269 | Commission | 3 124 | 5 263 |
| Stocks | | | Other contributors | 1 066 | 2 270 |
| Office supplies | 33 | 26 | Automatic carry-overs | 8 852 | 7 591 |
| Subtotal | 33 | 26 | Sundry accounts payable | 0 | 769 |
| Current assets | | | Deductions from salaries | 417 | 111 |
| Community subsidies | 3 124 | 5 263 | Subtotal | 13 460 | 16 003 |
| Other subsidies | 1 066 | 2 270 | Suspense accounts and deferrals | | |
| Recovery orders | 65 | 226 | Sums to be reused | 212 | 175 |
| Sundry accounts receivable | 127 | 153 | Recovery orders | 65 | 226 |
| Recoverable VAT | 232 | 266 | Subtotal | 277 | 400 |
| Subtotal | 4 614 | 8 178 | | | |
| Cash accounts | | | | | |
| Bank accounts | 4 892 | 740 | | | |
| Imprest account | 40 | 40 | | | |
| Subtotal | 4 932 | 780 | | | |
| Suspense accounts and accruals | | | | | |
| Suspense accounts | 0 | 18 | | | |
| Subtotal | 0 | 18 | | | |
| Total | 10 811 | 10 271 | Total | 10 811 | 10 271 |
| NB:The totals may include differences due to rounding.

  Source:Information supplied bythe Agency. These tables summarise the data provided by the Agency in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets

Own capital

Computer equipment

1 366

1 847

Own capital

1 265

1 295

Equipment and furniture

2 302

2 254

Balance for the financial year

–4 190

–7 427

Financial fixed assets

425

405

Subtotal

–2 925

–6 133

Depreciation

–2 860

–3 237

Current liabilities

Subtotal

1 232

1 269

Commission

3 124

5 263

Stocks

Other contributors

1 066

2 270

Office supplies

33

26

Automatic carry-overs

8 852

7 591

Subtotal

33

26

Sundry accounts payable

0

769

Current assets

Deductions from salaries

417

111

Community subsidies

3 124

5 263

Subtotal

13 460

16 003

Other subsidies

1 066

2 270

Suspense accounts and deferrals

Recovery orders

65

226

Sums to be reused

212

175

Sundry accounts receivable

127

153

Recovery orders

65

226

Recoverable VAT

232

266

Subtotal

277

400

Subtotal

4 614

8 178

Cash accounts

Bank accounts

4 892

740

Imprest account

40

40

Subtotal

4 932

780

Suspense accounts and accruals

Suspense accounts

0

18

Subtotal

0

18

Total

10 811

10 271

Total

10 811

10 271

NB:The totals may include differences due to rounding.

Source:Information supplied bythe Agency. These tables summarise the data provided by the Agency in its own accounts.

---

THE AGENCY'S REPLIES

| 7 and 8. | The need to reinforce the management of recoveries and the requirement for regular reconciliations of the accounts is recognised by the European Environment Agency.
  To remediate the resource limitations that have occurred and to increase the capacities it has been decided to recruit an accountant at the administrator level against the establishment table 2004.
  In the short term, an EEA task force on accounting is being established to ensure regular and correct operations throughout the year, to implement accrual accounting and to prepare for the closing of the accounts against the necessary standards and requirements. |
| --- | --- |

7 and 8.

The need to reinforce the management of recoveries and the requirement for regular reconciliations of the accounts is recognised by the European Environment Agency.

To remediate the resource limitations that have occurred and to increase the capacities it has been decided to recruit an accountant at the administrator level against the establishment table 2004.

In the short term, an EEA task force on accounting is being established to ensure regular and correct operations throughout the year, to implement accrual accounting and to prepare for the closing of the accounts against the necessary standards and requirements.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/30 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/30

---

REPORT

on the annual accounts of the European Agency for the Evaluation of Medicinal Products concerning the 2003 financial year together with the Agency's replies

(2004/C 324/05)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-14 | OBSERVATIONS |
| --- | --- |

6-14

Tables 1 to 5

The Agency's replies

INTRODUCTION

| 1. | The European Agency for the Evaluation of Medicinal Products (hereinafter referred to as the Agency) was created by Council Regulation (EEC) No 2309/93 of 22 July 1993 (1). The Agency operates through a network and coordinates the scientific resources made available by the national authorities in order to ensure the evaluation and supervision of medicinal products for human or veterinary use. Table 1 summarises the powers and responsibilities of the Agency on the basis of the information supplied by it. |
| --- | --- |

1.

The European Agency for the Evaluation of Medicinal Products (hereinafter referred to as the Agency) was created by Council Regulation (EEC) No 2309/93 of 22 July 1993 (1). The Agency operates through a network and coordinates the scientific resources made available by the national authorities in order to ensure the evaluation and supervision of medicinal products for human or veterinary use. Table 1 summarises the powers and responsibilities of the Agency on the basis of the information supplied by it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council, pursuant to Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council, pursuant to Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the annual accounts of the Agency for the financial year ended 31 December 2003. In accordance with Article 57a(1) of Council Regulation (EEC) No 2309/93, the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted on the basis of Article 57a(11) of the same regulation. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of the Agency for the financial year ended 31 December 2003. In accordance with Article 57a(1) of Council Regulation (EEC) No 2309/93, the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted on the basis of Article 57a(11) of the same regulation. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the procedures it considered necessary in this context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the procedures it considered necessary in this context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable. The Court would nevertheless draw attention to the situation described in paragraph 10. Except for the situations described in paragraphs 7 and 12, the Court has obtained reasonable assurance that the underlying transactions, taken as a whole, are legal and regular. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable. The Court would nevertheless draw attention to the situation described in paragraph 10. Except for the situations described in paragraphs 7 and 12, the Court has obtained reasonable assurance that the underlying transactions, taken as a whole, are legal and regular.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous year is set out, in Table 2. Tables 3 and 4 set out in summary form, the revenue and expenditure account and the balance sheet published by the Agency for the financial year 2003. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous year is set out, in Table 2. Tables 3 and 4 set out in summary form, the revenue and expenditure account and the balance sheet published by the Agency for the financial year 2003.

| 7. | On 5 June 2003, the Management Board of the Agency, subject to approval by the Commission, adopted a new financial regulation and corresponding implementing rules, which came into effect as of the second half of the financial year 2003 (4). In its opinion No 6/2003 of 17 July 2003, the Court had drawn attention to differences between the Agency's own financial regulation and the framework Financial Regulation applicable to the agencies in general. In paragraph 7 of its opinion, the Court emphasised in particular that the Agency's implementing rules on the award of contracts must be in line with the provisions of the general Financial Regulation and the general implementing rules. For example, whereas the general rules provide for a committee for the evaluation of tenders to be set up for any contract involving an amount exceeding 13 800 euro, the Agency sets this threshold at 75 000 euro (Table 5 sets out the differences noted). |
| --- | --- |

7.

On 5 June 2003, the Management Board of the Agency, subject to approval by the Commission, adopted a new financial regulation and corresponding implementing rules, which came into effect as of the second half of the financial year 2003 (4). In its opinion No 6/2003 of 17 July 2003, the Court had drawn attention to differences between the Agency's own financial regulation and the framework Financial Regulation applicable to the agencies in general. In paragraph 7 of its opinion, the Court emphasised in particular that the Agency's implementing rules on the award of contracts must be in line with the provisions of the general Financial Regulation and the general implementing rules. For example, whereas the general rules provide for a committee for the evaluation of tenders to be set up for any contract involving an amount exceeding 13 800 euro, the Agency sets this threshold at 75 000 euro (Table 5 sets out the differences noted).

| 8. | The Agency's accounts for 2003 were drawn up on the basis of the accounting principles laid down by its new financial regulation (5). The accounting data relating to the financial year 2002 have not been processed again in accordance with the accounting rules used when the accounts for the financial year ended on 31 December 2003 were drawn up. |
| --- | --- |

8.

The Agency's accounts for 2003 were drawn up on the basis of the accounting principles laid down by its new financial regulation (5). The accounting data relating to the financial year 2002 have not been processed again in accordance with the accounting rules used when the accounts for the financial year ended on 31 December 2003 were drawn up.

| 9. | Article 43(1)(e) of the Agency's financial regulation provides that the accounting officer shall validate the systems laid down by the authorising officer to supply or justify accounting information. This validation has not taken place. |
| --- | --- |

9.

Article 43(1)(e) of the Agency's financial regulation provides that the accounting officer shall validate the systems laid down by the authorising officer to supply or justify accounting information. This validation has not taken place.

| 10. | In 2003 the Agency carried out a physical inventory of fixed assets that was based on the nature of the assets, even though the fixed asset accounts are kept according to the year that the assets are acquired. This situation makes it difficult to reconcile the physical data and the accounting data. Furthermore, some assets appear in neither the inventory nor the fixed asset accounts. Their total value after depreciation was assessed at 4 188 000 euro (6) and was included in the balance sheet under the item ‘Fixed assets’. The Agency should set up a system for managing the fixed assets that ensures that the inventory data are both exhaustive and consistent with the accounting data. |
| --- | --- |

10.

In 2003 the Agency carried out a physical inventory of fixed assets that was based on the nature of the assets, even though the fixed asset accounts are kept according to the year that the assets are acquired. This situation makes it difficult to reconcile the physical data and the accounting data. Furthermore, some assets appear in neither the inventory nor the fixed asset accounts. Their total value after depreciation was assessed at 4 188 000 euro (6) and was included in the balance sheet under the item ‘Fixed assets’. The Agency should set up a system for managing the fixed assets that ensures that the inventory data are both exhaustive and consistent with the accounting data.

| 11. | In the application of internal control measures, continuity is not ensured. For example, certain case-files do not contain all the supporting documents required to create a commitment or a payment order. |
| --- | --- |

11.

In the application of internal control measures, continuity is not ensured. For example, certain case-files do not contain all the supporting documents required to create a commitment or a payment order.

| 12. | In certain negotiated procedures the choice of supplier is based on the criterion of ‘former experience with the contractor’, which is not provided for in the implementing rules (7) for the financial regulation. |
| --- | --- |

12.

In certain negotiated procedures the choice of supplier is based on the criterion of ‘former experience with the contractor’, which is not provided for in the implementing rules (7) for the financial regulation.

| 13. | An examination of the recruitment files has brought to light a significant number of shortcomings in the formalisation and the documentation: reasons are not given to support the choice of candidates invited for interview or check-lists, which are drawn up for the purpose of verifying the admissibility of the candidates, do not include all the selection criteria set out in the vacancy notices. |
| --- | --- |

13.

An examination of the recruitment files has brought to light a significant number of shortcomings in the formalisation and the documentation: reasons are not given to support the choice of candidates invited for interview or check-lists, which are drawn up for the purpose of verifying the admissibility of the candidates, do not include all the selection criteria set out in the vacancy notices.

| 14. | The Agency's ‘quality assurance’ unit serves as the internal auditor. Two of its audits, carried out in 2002 on the organisation of an electronic documentation system, brought to light a significant increase in costs and time taken caused by insufficient monitoring of the project. A subsequent audit carried out by an external consultant in 2003 confirmed the weaknesses found by the internal auditor. The project undertaken at the end of 2000 ought to have started production at the beginning of 2002 at an estimated cost of 1,2 million euro. The system was still not operational in 2003 and the costs already incurred amounted to 1,7 million euro. |
| --- | --- |

14.

The Agency's ‘quality assurance’ unit serves as the internal auditor. Two of its audits, carried out in 2002 on the organisation of an electronic documentation system, brought to light a significant increase in costs and time taken caused by insufficient monitoring of the project. A subsequent audit carried out by an external consultant in 2003 confirmed the weaknesses found by the internal auditor. The project undertaken at the end of 2000 ought to have started production at the beginning of 2002 at an estimated cost of 1,2 million euro. The system was still not operational in 2003 and the costs already incurred amounted to 1,7 million euro.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 214, 24.8.1993, p. 18; following the adoption of Regulation (EC) No 726/2004 of the European Parliament and of the Council of 31 March 2004 (OJ L 136, 30.4.2004, p. 1) the Agency's new name is the European Medicines Agency.

1

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

2

(3)  As required under Article 83(3) of the Agency's financial regulation, the final accounts for the financial year 2003 were drawn up on 14 May 2004 and forwarded to the Court of Auditors, which received them on 24 September 2004. A summarised version of these accounts is presented in the tables attached to this report.

3

(4)  The Commission gave its opinion at the beginning of 2004.

4

(5)  Article 78 of the Agency's financial regulation.

5

(6)  The sum relates to software and to alterations to the premises.

6

(7)  Article 86 of the detailed rules for the implementation of the Agency's financial regulation.

7

---

Table 1

European Agency for the Evaluation of Medicinal Products (London)

| Areas of Community competence deriving from the Treaty | Competence of the Agency as defined in Council Regulation (EC) No 2309/93 of 22 July 1993 | Governance | Resources available to the Agency

  (data for 2002) | Products and services supplied in 2003

  (data for 2002) |
| --- | --- | --- | --- | --- |
| A high level of human health protection shall be ensured in the definition and implementation of all Community policies and activities.
  Community action, which shall complement national policies, shall be directed towards improving public health, preventing human illness and diseases, and obviating sources of danger to human health.

  (Extract from Article 152 of the Treaty) | Objectives







  — | To coordinate the scientific resources that the Member States' authorities make available to the Agency for the authorisation and supervision of medicinal products for human or veterinary use |

Areas of Community competence deriving from the Treaty

Competence of the Agency as defined in Council Regulation (EC) No 2309/93 of 22 July 1993

Governance

Resources available to the Agency

(data for 2002)

Products and services supplied in 2003

(data for 2002)

A high level of human health protection shall be ensured in the definition and implementation of all Community policies and activities.

Community action, which shall complement national policies, shall be directed towards improving public health, preventing human illness and diseases, and obviating sources of danger to human health.

(Extract from Article 152 of the Treaty)

Objectives

—

To coordinate the scientific resources that the Member States' authorities make available to the Agency for the authorisation and supervision of medicinal products for human or veterinary use

| — | To provide the Member States and the institutions of the Union with scientific advice on medicinal products for human or veterinary use |
| --- | --- |

—

To provide the Member States and the institutions of the Union with scientific advice on medicinal products for human or veterinary use

Tasks

| — | To coordinate the scientific evaluation of medicinal products which are subject to Community marketing authorisation procedures |
| --- | --- |

—

To coordinate the scientific evaluation of medicinal products which are subject to Community marketing authorisation procedures

| — | To coordinate the supervision of medicinal products which have been authorised within the Community (pharmacovigilance) |
| --- | --- |

—

To coordinate the supervision of medicinal products which have been authorised within the Community (pharmacovigilance)

| — | To advise on the maximum limits for residues of veterinary medicinal products which may be accepted in foodstuffs of animal origin |
| --- | --- |

—

To advise on the maximum limits for residues of veterinary medicinal products which may be accepted in foodstuffs of animal origin

| — | To coordinate the verification of compliance with the principles of good manufacturing practice, good laboratory practice and good clinical practice |
| --- | --- |

—

To coordinate the verification of compliance with the principles of good manufacturing practice, good laboratory practice and good clinical practice

| — | To record the status of marketing authorisations granted for medicinal products |
| --- | --- |

—

To record the status of marketing authorisations granted for medicinal products

| (1) | The Committee for Proprietary Medicinal Products, consisting of two members from each Member State, advises on any question relating to the evaluation of medicinal products for human use. |
| --- | --- |

(1)

The Committee for Proprietary Medicinal Products, consisting of two members from each Member State, advises on any question relating to the evaluation of medicinal products for human use.

| (2) | The Committee for Veterinary Medicinal Products, consisting of two members from each Member State, advises on any question relating to the evaluation of veterinary medicinal products. |
| --- | --- |

(2)

The Committee for Veterinary Medicinal Products, consisting of two members from each Member State, advises on any question relating to the evaluation of veterinary medicinal products.

| (3) | The Management Board, consisting of two representatives of each Member State, two representatives of the Commission and two representatives appointed by the European Parliament. The Board adopts the programme of work and the annual report. |
| --- | --- |

(3)

The Management Board, consisting of two representatives of each Member State, two representatives of the Commission and two representatives appointed by the European Parliament. The Board adopts the programme of work and the annual report.

| (4) | The Executive Director is appointed by the Management Board on a proposal from the Commission. |
| --- | --- |

(4)

The Executive Director is appointed by the Management Board on a proposal from the Commission.

| (5) | External audit: Court of Auditors. |
| --- | --- |

(5)

External audit: Court of Auditors.

| (6) | Discharge is given by the Parliament on a recommendation from the Council. |
| --- | --- |

(6)

Discharge is given by the Parliament on a recommendation from the Council.

Final budget:

84,2 million EUR (61,3 million EUR), of which the Community contribution (excluding subsidy for orphan medicines): 22,9 % (27,9 %)

Staff numbers as at 31 December 2003:

287 (251) posts provided for in the establishment plan,

Posts occupied: 256 (227)

+48 (37) other posts (auxiliary contracts, national experts on secondment, local staff, temporary staff)

Total staff: 304 (264)

Assigned to the following duties:

| — | operational: 242 (211) |
| --- | --- |

—

operational: 242 (211)

| — | administrative: 62 (53) |
| --- | --- |

—

administrative: 62 (53)

Medicinal products for human use

Applications for marketing authorisations: 39 (31)

Favourable opinions: 39 (24)

Average evaluation time: 190 days (192 days)

Opinions after authorisation: 941 (746)

Pharmacovigilance: 45 538 reports (42 608 reports)

Periodic reliability reports:276 (223)

Monitoring measures: 1 025 (738)

Scientific opinions: 65 (75)

Procedures for mutual recognition: 4 080 (3 501)

Veterinary Medicinal Products

New applications: 10 (3)

Applications in respect of variants: 64 (33)

Inspection: 76 (75)

Source:Information supplied by the Agency.

Table 2

European Agency for the Evaluation of Medicinal Products — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Expenditure allocation | Appropriations in the final budget | Appropriations carried over from the previous financial year | Appropriations available
  (2003 budget and financial year 2002) |
| entered | committed | paid | carried over | cancelled | outstanding commitments | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies (1) | 23,0 | 22,5 | Title I
  Staff | 31,5 | 29,7 | 29,2 | 0,5 | 1,8 | 0,4 | 0,3 | 0,1 | 31,9 | 30,1 | 29,5 | 0,5 | 1,9 |
| Own revenue | 59,0 | 60,1 | Title II
  Administration | 19,7 | 19,2 | 11,9 | 7,3 | 0,5 | 1,9 | 1,5 | 0,4 | 21,6 | 21,1 | 13,4 | 7,3 | 0,9 |
| Other revenue | 2,2 | 1,8 | Title III
  Operating expenditure | 33,0 | 32,8 | 24,5 | 8,3 | 0,2 | 4,5 | 4,2 | 0,3 | 37,5 | 37,3 | 28,7 | 8,3 | 0,5 |
| Total | 84,2 | 84,4 | Total | 84,2 | 81,7 | 65,6 | 16,1 | 2,5 | 6,8 | 6,0 | 0,8 | 91,0 | 88,5 | 71,6 | 16,1 | 3,3 |
| Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Expenditure allocation

Appropriations in the final budget

Appropriations carried over from the previous financial year

Appropriations available

(2003 budget and financial year 2002)

entered

committed

paid

carried over

cancelled

outstanding commitments

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies (1)

23,0

22,5

Title I

Staff

31,5

29,7

29,2

0,5

1,8

0,4

0,3

0,1

31,9

30,1

29,5

0,5

1,9

Own revenue

59,0

60,1

Title II

Administration

19,7

19,2

11,9

7,3

0,5

1,9

1,5

0,4

21,6

21,1

13,4

7,3

0,9

Other revenue

2,2

1,8

Title III

Operating expenditure

33,0

32,8

24,5

8,3

0,2

4,5

4,2

0,3

37,5

37,3

28,7

8,3

0,5

Total

84,2

84,4

Total

84,2

81,7

65,6

16,1

2,5

6,8

6,0

0,8

91,0

88,5

71,6

16,1

3,3

Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts.

Table 3

European Agency for the Evaluation of Medicinal Products — Revenue and expenditure accounts for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 (2) |
| Revenue |
| Fees relating to marketing authorisations | 58 657 | 38 372 |
| Commission subsidy including subsidies received from the EEA | 19 786 | 14 846 |
| Community subsidy for orphan medicines | 2 814 | 2 407 |
| Contributions for Community programmes | 1 208 | 9 |
| Administrative revenue | 2 153 | 1 688 |
| Sundry revenue | 848 | 54 |
| Total (a) | 85 466 | 57 376 |
| Expenditure (3) |
| Staff expenditure | 29 663 | 26 216 |
| Administrative expenditure | 10 905 | 10 718 |
| Operating expenditure | 32 838 | 21 467 |
| Depreciation | 2 364 | 0 |
| Total (b) | 75 770 | 58 401 |
| Result (c = a – b) | 9 696 | –1 025 |
| Other factors |
| Appropriations carried over from the previous financial year and cancelled (d) | 823 | 1 377 |
| Exchange-rate differences and other adjustments (e) | 413 | – 352 |
| Balance for the financial year (c + d + e) | 10 932 | 0 |
| Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts. |

(1000 euro)

2003

2002 (2)

Revenue

Fees relating to marketing authorisations

58 657

38 372

Commission subsidy including subsidies received from the EEA

19 786

14 846

Community subsidy for orphan medicines

2 814

2 407

Contributions for Community programmes

1 208

9

Administrative revenue

2 153

1 688

Sundry revenue

848

54

Total (a)

85 466

57 376

Expenditure (3)

Staff expenditure

29 663

26 216

Administrative expenditure

10 905

10 718

Operating expenditure

32 838

21 467

Depreciation

2 364

0

Total (b)

75 770

58 401

Result (c = a – b)

9 696

–1 025

Other factors

Appropriations carried over from the previous financial year and cancelled (d)

823

1 377

Exchange-rate differences and other adjustments (e)

413

– 352

Balance for the financial year (c + d + e)

10 932

0

Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts.

Table 4

European Agency for the Evaluation of Medicinal Products — Balance sheets as at 31 December 2003 and 31 December 2002 (4)

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Intangible assets | 3 401 | 0 | Own capital | | |
| | | | Budget outturn (a) | 4 037 | — |
| Fixed assets | | | Outturn after adjustments (b) | 6 895 | — |
| Plant, machinery and tools | 1 635 | 146 | Economic outturn (a + b) | 10 932 | — |
| Furniture and vehicle fleet | 1 011 | 991 | Outturn carried over from previous financial years (5) | 6 872 | 2 684 |
| Computer equipment | 2 548 | 1 547 | Subtotal | 17 804 | 2 684 |
| Subtotal | 5 194 | 2 684 | | | |
| | | | Current liabilities | | |
| Current assets | | | Amounts owed to Community institutions and bodies | 479 | 444 |
| VAT paid and to be recovered | 1 105 | 571 | Payment appropriations to be carried over | 11 936 | 6 811 |
| Amounts receivable from Community institutions and bodies | 107 | 3 744 | Sundry accounts payable | 127 | 603 |
| Sundry accounts receivable | 1 034 | 2 854 | Advances from customers | 8 845 | 9 293 |
| Sundry receivables | 64 | 0 | Subtotal | 21 387 | 17 151 |
| Subtotal | 2 310 | 7 169 | | | |
| Available assets | 28 286 | 9 982 | | | |
| Total | 39 191 | 19 835 | Total | 39 191 | 19 835 |
| Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Intangible assets

3 401

0

Own capital

Budget outturn (a)

4 037

—

Fixed assets

Outturn after adjustments (b)

6 895

—

Plant, machinery and tools

1 635

146

Economic outturn (a + b)

10 932

—

Furniture and vehicle fleet

1 011

991

Outturn carried over from previous financial years (5)

6 872

2 684

Computer equipment

2 548

1 547

Subtotal

17 804

2 684

Subtotal

5 194

2 684

Current liabilities

Current assets

Amounts owed to Community institutions and bodies

479

444

VAT paid and to be recovered

1 105

571

Payment appropriations to be carried over

11 936

6 811

Amounts receivable from Community institutions and bodies

107

3 744

Sundry accounts payable

127

603

Sundry accounts receivable

1 034

2 854

Advances from customers

8 845

9 293

Sundry receivables

64

0

Subtotal

21 387

17 151

Subtotal

2 310

7 169

Available assets

28 286

9 982

Total

39 191

19 835

Total

39 191

19 835

Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts.

Table 5

Differences between the general implementing rules and the Agency's implementing rules

| Committee for the evaluation of tenders (6) |
| --- |
| | Articles 145 and 146 of the general implementing rules | Article 107 of the Agency's implementing rules |
| Contract threshold: | 13 800 euro | 75 000 euro |
| Rules for negotiated procedures in respect of low-value contracts |
| Value of contracts | Article 129 of the general implementing rules | Article 89 of the Agency's implementing rules |
| less than 200 euro | payment of costs against invoices | provided for in Article 82 but threshold unspecified |
| less than 1 050 euro: negotiated procedure | award on the basis of a single tender | less than 1 500 euro: award on the basis of a single tender |
| between 1 050 and 13 800 euro: negotiated procedure with: | at least 3 candidates consulted | between 1 500 and 13 800 euro: at least 3 candidates consulted |
| between 13 800 and 50 000 euro, restricted procedure but without a CEI (7) with: | at least 5 candidates consulted | at least 3 candidates consulted |
| Source:Court of Auditors. |

Committee for the evaluation of tenders (6)

Articles 145 and 146 of the general implementing rules

Article 107 of the Agency's implementing rules

Contract threshold:

13 800 euro

75 000 euro

Rules for negotiated procedures in respect of low-value contracts

Value of contracts

Article 129 of the general implementing rules

Article 89 of the Agency's implementing rules

less than 200 euro

payment of costs against invoices

provided for in Article 82 but threshold unspecified

less than 1 050 euro: negotiated procedure

award on the basis of a single tender

less than 1 500 euro: award on the basis of a single tender

between 1 050 and 13 800 euro: negotiated procedure with:

at least 3 candidates consulted

between 1 500 and 13 800 euro: at least 3 candidates consulted

between 13 800 and 50 000 euro, restricted procedure but without a CEI (7) with:

at least 5 candidates consulted

at least 3 candidates consulted

Source:Court of Auditors.

---

(1)  Includes subsidies received from the European Economic Area.

Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts.

(2)  The data for the financial year 2002 have not been reprocessed according to the accounting principles followed for the financial year 2003 (see paragraph 8 of the report).

(3)  The portion of the appropriations carried over which is to be regarded as expenditure for the financial year has been evaluated on an overall basis rather than on the basis of examining individual transactions.

Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts.

(4)  Use of the model proposed by the Commission has resulted in balances being reallocated between the existing headings.

(5)  For 2002, the sum corresponds to the total of net fixed assets. For 2003, the sum also includes 4 188 000 euro corresponding to the activation in 2003 of assets acquired in previous years (see paragraph 10 of the report).

Source:The Agency's data. This table summarises the data provided by the Agency in its own accounts.

(6)  The only committee for the evaluation of tenders proposed by the Agency is the Advisory Committee on Procurement and Contracts, which is required to give its opinion on contracts involving amounts exceeding 75 000 euro (Article 107), whereas this threshold is 13 800 euro in the general implementing rules.

(7)  CEI: Call for expressions of interest.

Source:Court of Auditors.

---

THE AGENCY'S REPLIES

| 7. | The Agency has contacted the Commission to finalise the Financial Regulation. The changes made have been in the direction to satisfy the Commission’s comments as well as those of the Court of Auditors. In particular the thresholds for contracts and procurement have been aligned in the implementing rules. |
| --- | --- |

7.

The Agency has contacted the Commission to finalise the Financial Regulation. The changes made have been in the direction to satisfy the Commission’s comments as well as those of the Court of Auditors. In particular the thresholds for contracts and procurement have been aligned in the implementing rules.

| 8. | In accordance with International Public Sector Accounting Standard (IPSA) number 3, the resulting adjustments are reported as an adjustment to the opening capital. Comparative information for the year 2002 has not been restated, as it would not have provided meaningful additional information. As the European Institutions and agencies have to present accounts compliant with IPSAS for 2005, the Agency, following the calendar established by the Accounting Officer of the European Commission, will have systems in place which will assure compliance by January 1, 2005 including the presentation of comparative figures for 2004. |
| --- | --- |

8.

In accordance with International Public Sector Accounting Standard (IPSA) number 3, the resulting adjustments are reported as an adjustment to the opening capital. Comparative information for the year 2002 has not been restated, as it would not have provided meaningful additional information. As the European Institutions and agencies have to present accounts compliant with IPSAS for 2005, the Agency, following the calendar established by the Accounting Officer of the European Commission, will have systems in place which will assure compliance by January 1, 2005 including the presentation of comparative figures for 2004.

| 9. | The observation of the Court is relevant in a sense, however it was not a priority for the EMEA knowing that the current systems, including both procedures and software, existed since 1998 and have provided the necessary and accurate data for the establishment of the financial statements. These systems have not been modified since the application of the new financial regulations.
  The systems defined by the authorising officer will be formally validated by the accountant in the course of 2004. |
| --- | --- |

9.

The observation of the Court is relevant in a sense, however it was not a priority for the EMEA knowing that the current systems, including both procedures and software, existed since 1998 and have provided the necessary and accurate data for the establishment of the financial statements. These systems have not been modified since the application of the new financial regulations.

The systems defined by the authorising officer will be formally validated by the accountant in the course of 2004.

| 10. | In 2003, the Agency capitalised intangible assets (mainly software licenses and certain software development costs) in accordance with the standards issued by the Accounting Standards Committee. In order to establish the inventory of intangible assets and fitting out costs in prior years a detailed analysis of software and fitting out costs for 2000 to 2003 was prepared. During 2004, all assets, tangible and intangible, are being entered in the new asset management system and the accounting is based on the classification by type as set out in the harmonised accounting plan defined by the Commission's Accounting Officer. |
| --- | --- |

10.

In 2003, the Agency capitalised intangible assets (mainly software licenses and certain software development costs) in accordance with the standards issued by the Accounting Standards Committee. In order to establish the inventory of intangible assets and fitting out costs in prior years a detailed analysis of software and fitting out costs for 2000 to 2003 was prepared. During 2004, all assets, tangible and intangible, are being entered in the new asset management system and the accounting is based on the classification by type as set out in the harmonised accounting plan defined by the Commission's Accounting Officer.

| 11. | The Agency has noted the Court's comments. It has taken corrective measures to avoid such situations in the future. |
| --- | --- |

11.

The Agency has noted the Court's comments. It has taken corrective measures to avoid such situations in the future.

| 12. | The Agency has noted the Court's comments on the criteria of choice of contractors. |
| --- | --- |

12.

The Agency has noted the Court's comments on the criteria of choice of contractors.

| 13. | The Agency follows selection procedures with care. The admissibility of candidates to the selection procedure follows a checklist in each individual case, which covers all the elements stated in the announcement. This is documented on each individual file. In addition to the existing justification for the choice of each candidate for interview, the Agency will implement measures to improve the procedure and avoid the problems mentioned by the Court. |
| --- | --- |

13.

The Agency follows selection procedures with care. The admissibility of candidates to the selection procedure follows a checklist in each individual case, which covers all the elements stated in the announcement. This is documented on each individual file. In addition to the existing justification for the choice of each candidate for interview, the Agency will implement measures to improve the procedure and avoid the problems mentioned by the Court.

| 14. | In recognition of the serious difficulties being encountered in the implementation of the project, the Agency’s management took action, beginning with the commissioning of the external audit in early 2003. The specification has been refined and implementation of the electronic document management system has since been undertaken in the light of that analysis. |
| --- | --- |

14.

In recognition of the serious difficulties being encountered in the implementation of the project, the Agency’s management took action, beginning with the commissioning of the external audit in early 2003. The specification has been refined and implementation of the electronic document management system has since been undertaken in the light of that analysis.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/39 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/39

---

REPORT

on the annual accounts of the European Food Safety Authority for the 2003 financial year together with the Authority's replies

(2004/C 324/06)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-9 | OBSERVATIONS |
| --- | --- |

6-9

Tables 1 to 4

The Authority's replies

INTRODUCTION

| 1. | The European Food Safety Authority (hereinafter called the Authority) was established by Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002 (1). The Commission handled the Authority's financial management in 2002 and it had no separate accounts of its own. The financial year 2003 was thus the first in which the Authority was fully responsible for its financial management. Its main responsibilities are to supply the necessary scientific information needed for Community legislation to be drawn up, to collect and analyse data that allow risks to be characterised and controlled and to provide independent information on these risks. The Authority's responsibilities and activities are summarised in Table 1 on the basis of information supplied by it. |
| --- | --- |

1.

The European Food Safety Authority (hereinafter called the Authority) was established by Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002 (1). The Commission handled the Authority's financial management in 2002 and it had no separate accounts of its own. The financial year 2003 was thus the first in which the Authority was fully responsible for its financial management. Its main responsibilities are to supply the necessary scientific information needed for Community legislation to be drawn up, to collect and analyse data that allow risks to be characterised and controlled and to provide independent information on these risks. The Authority's responsibilities and activities are summarised in Table 1 on the basis of information supplied by it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court of Auditors has examined the Authority's annual accounts for the financial year ended 31 December 2003. In accordance with Article 44(1) of Regulation (EC) No 178/2002 (1), the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions adopted pursuant to Article 44(3) of Regulation (EC) No 178/2002. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court of Auditors has examined the Authority's annual accounts for the financial year ended 31 December 2003. In accordance with Article 44(1) of Regulation (EC) No 178/2002 (1), the budget was implemented on the responsibility of the Executive Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions adopted pursuant to Article 44(3) of Regulation (EC) No 178/2002. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is set out in Table 2. The Authority's revenue and expenditure account and balance sheet for the financial year 2003 are summarised in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is set out in Table 2. The Authority's revenue and expenditure account and balance sheet for the financial year 2003 are summarised in Tables 3 and 4.

| 7. | Article 43(1)(e) of the Authority's financial regulation provides that the Accounting Officer is to validate the systems laid down by the Authorising Officer to supply or justify accounting information. No such validation has taken place. |
| --- | --- |

7.

Article 43(1)(e) of the Authority's financial regulation provides that the Accounting Officer is to validate the systems laid down by the Authorising Officer to supply or justify accounting information. No such validation has taken place.

| 8. | The Personnel Department did not carry out systematic checks on the determination of the remuneration (particularly salaries) and on the financial entitlements of newly recruited staff. |
| --- | --- |

8.

The Personnel Department did not carry out systematic checks on the determination of the remuneration (particularly salaries) and on the financial entitlements of newly recruited staff.

| 9. | Examination of the IT system control environment showed that it needed to be strengthened in view of the planned increase in the Authority's activities. |
| --- | --- |

9.

Examination of the IT system control environment showed that it needed to be strengthened in view of the planned increase in the Authority's activities.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 31, 1.2.2002, p. 1.

1

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

2

(3)  As required under Article 83(3) of the Authority's financial regulation, the final accounts for the financial year 2003 were drawn up on 14 September 2004 and forwarded to the Court of Auditors. These accounts were received by the Court on 17 September 2004. A summarised version of these accounts is presented in the tables annexed to this report.

3

---

Table 1

European Food Safety Authority (temporary headquarters: Brussels, due to be transferred to Parma)

| Areas of Community competence deriving from the Treaty | Competence of the Authority
  (Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002) | Governance | Resources made available to the Authority in 2003 | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| Free movement of foodstuffs (Article 37 of the Treaty)

  A high level of protection of health, safety and protection of the environment and of consumers, taking account of any new developments based on scientific facts (Article 95 of the Treaty)

  Common trade policy (Article 133 of the Treaty)

  Public health (Article 152(4)(b) of the Treaty) | Objectives







  — | To provide scientific opinions and scientific and technical support for the Community's legislation and policies which have a direct or indirect impact on food and feed safety |

Areas of Community competence deriving from the Treaty

Competence of the Authority

(Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002)

Governance

Resources made available to the Authority in 2003

Products and services supplied in 2003

Free movement of foodstuffs (Article 37 of the Treaty)

A high level of protection of health, safety and protection of the environment and of consumers, taking account of any new developments based on scientific facts (Article 95 of the Treaty)

Common trade policy (Article 133 of the Treaty)

Public health (Article 152(4)(b) of the Treaty)

Objectives

—

To provide scientific opinions and scientific and technical support for the Community's legislation and policies which have a direct or indirect impact on food and feed safety

| — | To provide independent information on risks relating to food safety |
| --- | --- |

—

To provide independent information on risks relating to food safety

| — | To contribute to the achievement of a high level of protection of human life and health |
| --- | --- |

—

To contribute to the achievement of a high level of protection of human life and health

| — | To collect and analyse data needed to allow characterisation and monitoring of risks |
| --- | --- |

—

To collect and analyse data needed to allow characterisation and monitoring of risks

Tasks

| — | To issue scientific opinions and studies |
| --- | --- |

—

To issue scientific opinions and studies

| — | To promote uniform risk assessment methodologies |
| --- | --- |

—

To promote uniform risk assessment methodologies

| — | To assist the Commission |
| --- | --- |

—

To assist the Commission

| — | To search for, analyse and summarise the requisite scientific and technical data |
| --- | --- |

—

To search for, analyse and summarise the requisite scientific and technical data

| — | To identify and characterise emerging risks |
| --- | --- |

—

To identify and characterise emerging risks

| — | To establish a network of organisations operating in similar fields |
| --- | --- |

—

To establish a network of organisations operating in similar fields

| — | To provide scientific and technical assistance in crisis management |
| --- | --- |

—

To provide scientific and technical assistance in crisis management

| — | To improve international cooperation |
| --- | --- |

—

To improve international cooperation

| — | To provide the public and interested parties with reliable, objective and easily comprehensible information |
| --- | --- |

—

To provide the public and interested parties with reliable, objective and easily comprehensible information

| — | To take part in the Commission's rapid alert system. |
| --- | --- |

—

To take part in the Commission's rapid alert system.

| 1. | Management Board

  Composition
  14 members appointed by the Council (in cooperation with the European Parliament and the Commission) and one representative of the Commission
  Duties
  To adopt the work programme and ensure that it is implemented |
| --- | --- |

1.

Management Board

14 members appointed by the Council (in cooperation with the European Parliament and the Commission) and one representative of the Commission

To adopt the work programme and ensure that it is implemented

| 2. | Executive Director

  Appointed by the Management Board on the basis of a list of candidates proposed by the Commission, following a hearing before the European Parliament |
| --- | --- |

2.

Executive Director

Appointed by the Management Board on the basis of a list of candidates proposed by the Commission, following a hearing before the European Parliament

| 3. | Advisory Forum

  Composition
  One representative per Member State
  Duties
  To advise the Executive Director |
| --- | --- |

3.

Advisory Forum

One representative per Member State

To advise the Executive Director

| 4. | Scientific Committee and Scientific Panels:

  To draw up the Authority's scientific opinions |
| --- | --- |

4.

Scientific Committee and Scientific Panels:

To draw up the Authority's scientific opinions

| 5. | External audit

  Court of Auditors |
| --- | --- |

5.

External audit

Court of Auditors

| 6. | Discharge authority

  Parliament, on the Council's recommendation |
| --- | --- |

6.

Discharge authority

Parliament, on the Council's recommendation

Final budget

12,6 million euro Community contribution: 99,7 %

Staff numbers as at 31 December 2003

Number of posts in establishment plan: 49

Posts occupied: 27

+36 other staff (auxiliary contracts, seconded national experts, local staff, temporary staff)

Total staff: 63

Assigned to the following duties:

operational: 33

administrative: 30

The Authority set up its Scientific Committee and all the Scientific Panels in June 2003. It issued 23 public opinions during the remainder of the year.

In October the Authority held a conference in Ostende (Belgium) with its interested parties, the purpose of which was to determine how to carry out its mandate in the future.

The Advisory Forum met six times with a view to setting up the network linking the national authorities. This led to increased exchanges of information with the Authority and between the national departments concerned.

Source:Information supplied by the Authority.

Table 2

European Food Safety Authority — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Allocation of expenditure | Final budget appropriations | Appropriations carried over from the previous financial year (1) | Available appropriations
  (2003 budget and carry-over from financial year 2002) |
| entered | committed | paid | carried over | cancelled | entered | paid | cancelled | entered | committed | paid | carried over | cancelled |
| Community subsidies | 12,6 | 10,0 | Title I
  Staff | 4,1 | 3,7 | 3,6 | 0,1 | 0,4 | 0,0 | 0,0 | 0,0 | 4,1 | 3,7 | 3,6 | 0,1 | 0,4 |
| Other subsidies | 0,0 | 0,0 | Title II
  Administration | 2,8 | 2,2 | 1,0 | 1,2 | 0,6 | 0,3 | 0,1 | 0,2 | 3,1 | 2,2 | 1,1 | 1,2 | 0,8 |
| Other revenue | p.m. | 0,0 | Title III
  Operating expenditure | 5,7 | 4,0 | 1,1 | 2,9 | 1,7 | 0,1 | 0,1 | 0,0 | 5,8 | 4,0 | 1,2 | 2,9 | 1,7 |
| Total | 12,6 | 10,0 | Total | 12,6 | 9,9 | 5,7 | 4,2 | 2,7 | 0,4 | 0,2 | 0,2 | 13,0 | 9,9 | 5,9 | 4,2 | 2,9 |
| NB:The totals may include differences due to rounding.

  Source:information supplied bythe Authority. These tables summarise the data provided by the Authority in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Allocation of expenditure

Final budget appropriations

Appropriations carried over from the previous financial year (1)

Available appropriations

(2003 budget and carry-over from financial year 2002)

entered

committed

paid

carried over

cancelled

entered

paid

cancelled

entered

committed

paid

carried over

cancelled

Community subsidies

12,6

10,0

Title I

Staff

4,1

3,7

3,6

0,1

0,4

0,0

0,0

0,0

4,1

3,7

3,6

0,1

0,4

Other subsidies

0,0

0,0

Title II

Administration

2,8

2,2

1,0

1,2

0,6

0,3

0,1

0,2

3,1

2,2

1,1

1,2

0,8

Other revenue

p.m.

0,0

Title III

Operating expenditure

5,7

4,0

1,1

2,9

1,7

0,1

0,1

0,0

5,8

4,0

1,2

2,9

1,7

Total

12,6

10,0

Total

12,6

9,9

5,7

4,2

2,7

0,4

0,2

0,2

13,0

9,9

5,9

4,2

2,9

NB:The totals may include differences due to rounding.

Source:information supplied bythe Authority. These tables summarise the data provided by the Authority in its own accounts.

Table 3

European Food Safety Authority — Revenue and expenditure account for the 2003 financial year

| (1000 euro) |
| --- |
| | 2003 |
| Revenue |
| Commission subsidies | 10 284 |
| Other revenue | 33 |
| Total revenue (a) | 10 317 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 3 567 |
| Appropriations carried over | 149 |
| Administration — Title II of the budget |
| Payments | 1 092 |
| Appropriations carried over | 1 189 |
| Operating expenditure — Title III of the budget |
| Payments | 1 278 |
| Appropriations carried over | 2 895 |
| Total expenditure (b) | 10 171 |
| Outturn for the financial year (a – b) | 146 |
| Exchange-rate difference | 0 |
| Balance for the financial year | 146 |
| NB:The totals may include differences due to rounding.

  Source:information supplied by the Authority. |

(1000 euro)

2003

Revenue

Commission subsidies

10 284

Other revenue

33

Total revenue (a)

10 317

Expenditure

Staff — Title I of the budget

Payments

3 567

Appropriations carried over

149

Administration — Title II of the budget

Payments

1 092

Appropriations carried over

1 189

Operating expenditure — Title III of the budget

Payments

1 278

Appropriations carried over

2 895

Total expenditure (b)

10 171

Outturn for the financial year (a – b)

146

Exchange-rate difference

0

Balance for the financial year

146

NB:The totals may include differences due to rounding.

Source:information supplied by the Authority.

Table 4

European Food Safety Authority — Balance sheet at 31 December 2003

| (1000 euro) |
| --- |
| Assets | 2003 | Liabilities | 2003 |
| Fixed assets | | Fixed capital | |
| Intangible assets | 362 | Own capital | 769 |
| Equipment and furniture | 106 | Balance for the financial year | 146 |
| Computer equipment | 701 | Subtotal | 915 |
| Depreciation | – 401 | Current liabilities | |
| Subtotal | 769 | Automatic carry-overs of appropriations | 4 233 |
| Current assets | | Salary deductions | 8 |
| Recovery orders | 1 | Subtotal | 4 241 |
| Sundry accounts receivable | 2 | Suspense accounts | |
| Subtotal | 3 | Sums to be re-used | 6 |
| Cash accounts | | Subtotal | 6 |
| Bank accounts | 4 342 | | |
| Imprest account | 15 | | |
| Subtotal | 4 357 | | |
| Suspense accounts | 33 | | |
| Total | 5 162 | Total | 5 162 |
| NB:The totals may include differences due to rounding.

  Source:information supplied by the Authority. |

(1000 euro)

Assets

2003

Liabilities

2003

Fixed assets

Fixed capital

Intangible assets

362

Own capital

769

Equipment and furniture

106

Balance for the financial year

146

Computer equipment

701

Subtotal

915

Depreciation

– 401

Current liabilities

Subtotal

769

Automatic carry-overs of appropriations

4 233

Current assets

Salary deductions

8

Recovery orders

1

Subtotal

4 241

Sundry accounts receivable

2

Suspense accounts

Subtotal

3

Sums to be re-used

6

Cash accounts

Subtotal

6

Bank accounts

4 342

Imprest account

15

Subtotal

4 357

Suspense accounts

33

Total

5 162

Total

5 162

NB:The totals may include differences due to rounding.

Source:information supplied by the Authority.

---

(1)  The Authority has not included automatic carry-overs and the use made of them in its accounts on the ground that the Commission was its Authorising Officer by delegation for the financial year 2002. Only appropriations for the financial year 2002 that were not carried over automatically were managed and entered in the accounts by the Authority.

NB:The totals may include differences due to rounding.

Source:information supplied bythe Authority. These tables summarise the data provided by the Authority in its own accounts.

---

THE AUTHORITY'S REPLIES

| 7. | The description and validation of the accounting systems will be carried out in the course of the 2004 financial year. |
| --- | --- |

7.

The description and validation of the accounting systems will be carried out in the course of the 2004 financial year.

| 8. | As a result of the observations made, checks on the determination of the grades and steps attributed to newly recruited staff were validated and dated by the head of Human Resources. The data relating to the individual rights of staff were also validated. |
| --- | --- |

8.

As a result of the observations made, checks on the determination of the grades and steps attributed to newly recruited staff were validated and dated by the head of Human Resources. The data relating to the individual rights of staff were also validated.

| 9. | A start was made on strengthening the IT system in March 2004. The principle aims are:






  1. | to ensure the reliability of the IT infrastructure; |
| --- | --- | --- |

9.

A start was made on strengthening the IT system in March 2004. The principle aims are:

1.

to ensure the reliability of the IT infrastructure;

| 2. | to create, document and introduce operational procedures; |
| --- | --- |

2.

to create, document and introduce operational procedures;

| 3. | to rationalise the IT software systems, work processes and the flow of information. |
| --- | --- |

3.

to rationalise the IT software systems, work processes and the flow of information.

These activities are intended to give the Authority an effective IT system to match the increases in its activities.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/46 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/46

---

REPORT

on the annual accounts of the Translation Centre for the bodies of the European Union for the 2003 financial year together with the Centre's replies

(2004/C 324/07)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-8 | OBSERVATIONS |
| --- | --- |

6-8

Tables 1 to 4

The Centre's replies

INTRODUCTION

| 1. | The Translation Centre for the bodies of the European Union (hereinafter the Centre) was established by Council Regulation (EC) No 2965/94 (1). The Centre's role is to provide the EU bodies, and any other EU institutions and bodies which call upon its services, with the translation services necessary for their activities. Table 1contains a summary of the Centre's responsibilities and activities based on information provided by the Centre. |
| --- | --- |

1.

The Translation Centre for the bodies of the European Union (hereinafter the Centre) was established by Council Regulation (EC) No 2965/94 (1). The Centre's role is to provide the EU bodies, and any other EU institutions and bodies which call upon its services, with the translation services necessary for their activities. Table 1contains a summary of the Centre's responsibilities and activities based on information provided by the Centre.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court of Auditors has examined the annual accounts of the Translation Centre for the bodies of the European Union for the financial year ended 31 December 2003. In accordance with Article 14(1) of Council Regulation (EC) No 2965/94, the budget was implemented on the responsibility of the Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions provided for in Article 15 of the same Regulation. The Court is required, pursuant to Article 248 of the Treaty establishing the European Community, to examine these accounts. |
| --- | --- |

3.

The Court of Auditors has examined the annual accounts of the Translation Centre for the bodies of the European Union for the financial year ended 31 December 2003. In accordance with Article 14(1) of Council Regulation (EC) No 2965/94, the budget was implemented on the responsibility of the Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions provided for in Article 15 of the same Regulation. The Court is required, pursuant to Article 248 of the Treaty establishing the European Community, to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the auditing procedures that it considered necessary in this context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the auditing procedures that it considered necessary in this context.

| 5. | The Court thus obtained reasonable assurance that the annual accounts for the financial year ending on 31 December 2003 were reliable and that the underlying operations, taken as a whole, were legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court thus obtained reasonable assurance that the annual accounts for the financial year ending on 31 December 2003 were reliable and that the underlying operations, taken as a whole, were legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | The implementation of the budget for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2. The revenue and expenditure account and the balance sheet submitted by the Centre for the financial year 2003 are presented in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the budget for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2. The revenue and expenditure account and the balance sheet submitted by the Centre for the financial year 2003 are presented in summary form in Tables 3 and 4.

| 7. | The Centre's accounts for 2003 were adopted on the basis of the accounting principles laid down in its new Financial Regulation (4). The Centre did not reprocess all of the accounting data for the financial year 2002 in accordance with the accounting rules used to draw up its annual accounts for the financial year ending 31 December 2003. |
| --- | --- |

7.

The Centre's accounts for 2003 were adopted on the basis of the accounting principles laid down in its new Financial Regulation (4). The Centre did not reprocess all of the accounting data for the financial year 2002 in accordance with the accounting rules used to draw up its annual accounts for the financial year ending 31 December 2003.

| 8. | Provisions for risks and charges totalled 8 601 000 euro at the end of 2003, an increase of 2 195 000 euro when compared with 2002. Most of this amount (6 071 000 euro) concerned the sums claimed by the Commission corresponding to its share of pension contributions for the Centre's employees; the amount is disputed by the Centre. The remainder (2 530 000 euro) was established to cover rent owed to the Luxembourg authorities as soon as the definitive amount has been set. The Centre must make every effort to resolve these problems (5). |
| --- | --- |

8.

Provisions for risks and charges totalled 8 601 000 euro at the end of 2003, an increase of 2 195 000 euro when compared with 2002. Most of this amount (6 071 000 euro) concerned the sums claimed by the Commission corresponding to its share of pension contributions for the Centre's employees; the amount is disputed by the Centre. The remainder (2 530 000 euro) was established to cover rent owed to the Luxembourg authorities as soon as the definitive amount has been set. The Centre must make every effort to resolve these problems (5).

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 314, 7.12.1994, p. 1.

1

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

2

(3)  As laid down in Article 83(3) of the Centre's Financial Regulation, the final accounts for the financial year 2003 were drawn up on 14 September 2004 and sent to the Court of Auditors, which received them on 27 September 2004. A summarised version of these accounts is presented in the tables attached to this report.

3

(4)  Article 78 of the Centre's Financial Regulation.

4

(5)  See the Report concerning the financial year 2001 (paragraph 7, OJ C 326, 27.12.2002, p. 22).

5

---

Table 1

Translation Centre for the bodies of the European Union (Luxembourg)

| Scope of EU competencies stipulated in the Treaty | Competencies of the Centre as defined in the Parliament and Council Regulation — Council Regulation (EC) No 2965/94 of 28 November 1994 | Administration | Resources made available to the Centre (data for 2002) | Products and services provided in 2003 (data for 2002 in brackets) |
| --- | --- | --- | --- | --- |
| The representatives of the Member States' governments adopted by mutual agreement a declaration concerning the creation, under the aegis of the Commission's translation departments in Luxembourg, of a Translation Centre for the bodies of the Union, which would provide the necessary translation services for the operation of the bodies and services whose seats were established by the decision of 29 October 1993

  (Council Decision taken on the basis of Article 235 of the Treaty). | Objectives

  To provide the necessary translation services for the operation of the following bodies:






  — | the European Environment Agency |

Scope of EU competencies stipulated in the Treaty

Competencies of the Centre as defined in the Parliament and Council Regulation — Council Regulation (EC) No 2965/94 of 28 November 1994

Administration

Resources made available to the Centre (data for 2002)

Products and services provided in 2003 (data for 2002 in brackets)

The representatives of the Member States' governments adopted by mutual agreement a declaration concerning the creation, under the aegis of the Commission's translation departments in Luxembourg, of a Translation Centre for the bodies of the Union, which would provide the necessary translation services for the operation of the bodies and services whose seats were established by the decision of 29 October 1993

(Council Decision taken on the basis of Article 235 of the Treaty).

Objectives

To provide the necessary translation services for the operation of the following bodies:

—

the European Environment Agency

| — | the European Training Foundation |
| --- | --- |

—

the European Training Foundation

| — | the European Monitoring Centre for Drugs and Drug Addiction |
| --- | --- |

—

the European Monitoring Centre for Drugs and Drug Addiction

| — | the European Agency for the Evaluation of Medicinal Products; |
| --- | --- |

—

the European Agency for the Evaluation of Medicinal Products;

| — | the European Agency for Health and Safety at Work; |
| --- | --- |

—

the European Agency for Health and Safety at Work;

| — | the Office for Harmonisation in the Internal Market (Trademarks and Designs) |
| --- | --- |

—

the Office for Harmonisation in the Internal Market (Trademarks and Designs)

| — | the European Police Office (Europol) and the Europol Drugs Unit. |
| --- | --- |

—

the European Police Office (Europol) and the Europol Drugs Unit.

The bodies set up by the Council, other than the above, may use the Centre's services. The institutions and bodies of the European Union which already have their own Translation Service may, if need be, call upon the Centre's services on a voluntary basis.

Tasks

| — | Make arrangements for cooperating with the bodies and institutions |
| --- | --- |

—

Make arrangements for cooperating with the bodies and institutions

| — | Participate in the work of the Interinstitutional Translation Committee |
| --- | --- |

—

Participate in the work of the Interinstitutional Translation Committee

| 1. | Management Board

  Composition






  — | One representative per Member State |
| --- | --- | --- |

1.

Management Board

—

One representative per Member State

| — | Two representatives from the Commission, one of whom is Chairman |
| --- | --- |

—

Two representatives from the Commission, one of whom is Chairman

| — | One representative from each body or institution calling upon the Centre's services |
| --- | --- |

—

One representative from each body or institution calling upon the Centre's services

Adopts the Centre's annual work programme and annual report

| 2. | Director

  Appointed by the Management Board on a proposal from the Commission |
| --- | --- |

2.

Director

Appointed by the Management Board on a proposal from the Commission

| 3. | External control

  Court of Auditors |
| --- | --- |

3.

External control

Court of Auditors

| 4. | Discharge authority

  Parliament on a recommendation from the Council |
| --- | --- |

4.

Discharge authority

Parliament on a recommendation from the Council

Final budget

29 million euro (24 million euro)

Staff as at 31 December 2003

158 (158) posts listed in the establishment plan;

posts occupied: 132 (136)

+15 (5) other posts

Total staff 147 (141)

Assigned to:

| — | operational duties: 95 (91) |
| --- | --- |

—

operational duties: 95 (91)

| — | administrative duties: 48 (46) |
| --- | --- |

—

administrative duties: 48 (46)

| — | mixed duties: 4 (4) |
| --- | --- |

—

mixed duties: 4 (4)

Number of pages translated

238 399(227 783)

Number of pages per language

| — | official languages: 221 127(224 190) |
| --- | --- |

—

official languages: 221 127(224 190)

| — | other languages: 17 272(3 593) |
| --- | --- |

—

other languages: 17 272(3 593)

Number of pages per customer type

| — | bodies: 215 992(218 532) |
| --- | --- |

—

bodies: 215 992(218 532)

| — | institutions et al.: 22 407(9 521) |
| --- | --- |

—

institutions et al.: 22 407(9 521)

Number of freelance translation contracts: 245 (215)

Number of pages translated freelance: 94 355(86 826)

Source:Information supplied by the Centre.

Table 2

Translation Centre for the bodies of the European Union: implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Source of revenue | Revenue entered in the final budget for the financial year | Revenue received | Allocation of expenditure | Final budget appropriations | Appropriations carried over from the previous financial year | Appropriations available
  (2003 budget and 2002 financial year) |
| entered | committed | paid | carried over | cancelled | commitments outstanding | paid | cancelled | Appropriations | committed | paid | carried over | cancelled |
| Revenue paid by the bodies and institutions | 20,6 | 19,8 | Title I
  Staff | 12,5 | 10,3 | 10,2 | 0,1 | 2,2 | 0,1 | 0,1 | 0,0 | 12,6 | 10,4 | 10,3 | 0,1 | 2,2 |
| Financial income | 0,1 | 0,4 | Title II
  Administration | 3,2 | 1,9 | 1,3 | 0,6 | 1,3 | 0,7 | 0,6 | 0,1 | 3,9 | 2,6 | 1,9 | 0,6 | 1,4 |
| Miscellaneous income | 0,0 | 0,1 | Title III 
  Operating activities | 7,0 | 3,9 | 3,4 | 0,5 | 3,1 | 0,4 | 0,4 | 0,0 | 7,4 | 4,3 | 3,8 | 0,5 | 3,1 |
| Balance for the previous financial year | 8,3 | 0,0 | Title X
  Reserve and provisions | 6,3 | 0,0 | 0,0 | 0,0 | 6,3 | 0,0 | 0,0 | 0,0 | 6,3 | 0,0 | 0,0 | 0,0 | 6,3 |
| Total | 29,0 | 20,3 | Total | 29,0 | 16,1 | 14,9 | 1,2 | 12,9 | 1,2 | 1,1 | 0,1 | 30,2 | 17,3 | 16,0 | 1,2 | 13,0 |
| Source:Data compiled by the Centre. This table summarises the data supplied by the Centre in its own accounts. |

(million euro)

Revenue

Expenditure

Source of revenue

Revenue entered in the final budget for the financial year

Revenue received

Allocation of expenditure

Final budget appropriations

Appropriations carried over from the previous financial year

Appropriations available

(2003 budget and 2002 financial year)

entered

committed

paid

carried over

cancelled

commitments outstanding

paid

cancelled

Appropriations

committed

paid

carried over

cancelled

Revenue paid by the bodies and institutions

20,6

19,8

Title I

Staff

12,5

10,3

10,2

0,1

2,2

0,1

0,1

0,0

12,6

10,4

10,3

0,1

2,2

Financial income

0,1

0,4

Title II

Administration

3,2

1,9

1,3

0,6

1,3

0,7

0,6

0,1

3,9

2,6

1,9

0,6

1,4

Miscellaneous income

0,0

0,1

Title III

Operating activities

7,0

3,9

3,4

0,5

3,1

0,4

0,4

0,0

7,4

4,3

3,8

0,5

3,1

Balance for the previous financial year

8,3

0,0

Title X

Reserve and provisions

6,3

0,0

0,0

0,0

6,3

0,0

0,0

0,0

6,3

0,0

0,0

0,0

6,3

Total

29,0

20,3

Total

29,0

16,1

14,9

1,2

12,9

1,2

1,1

0,1

30,2

17,3

16,0

1,2

13,0

Source:Data compiled by the Centre. This table summarises the data supplied by the Centre in its own accounts.

Table 3

Translation Centre for the bodies of the European Union — Revenue and expenditure account for the financial

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Operating revenue |
| Invoicing for the financial year | 22 075 | 18 113 |
| Miscellaneous revenue | 223 | 291 |
| Total (a) | 22 298 | 18 404 |
| Operating expenditure |
| Current expenses | 18 255 | 18 446 |
| Total (b) | 18 255 | 18 446 |
| Operating result (c = a – b) | 4 043 | –42 |
| Financial income |
| Bank interest | 387 | 495 |
| Exchange-rate gain | 1 | 2 |
| Total (d) | 388 | 497 |
| Financial charges |
| Bank charges | 10 | 0 |
| Total (e) | 10 | 0 |
| Financial result (f = d – e) | 378 | 497 |
| Result for ordinary activities (g = c + f) | 4 421 | 455 |
| Exceptional income (h) | 19 | 0 |
| Exceptional expenses (i) | 9 | 0 |
| Exceptional result (j = h – i) | 10 | 0 |
| Result for the financial year (g + j) | 4 431 | 455 |
| Source:Data compiled by the Centre. |

(1000 euro)

2003

2002

Operating revenue

Invoicing for the financial year

22 075

18 113

Miscellaneous revenue

223

291

Total (a)

22 298

18 404

Operating expenditure

Current expenses

18 255

18 446

Total (b)

18 255

18 446

Operating result (c = a – b)

4 043

–42

Financial income

Bank interest

387

495

Exchange-rate gain

1

2

Total (d)

388

497

Financial charges

Bank charges

10

0

Total (e)

10

0

Financial result (f = d – e)

378

497

Result for ordinary activities (g = c + f)

4 421

455

Exceptional income (h)

19

0

Exceptional expenses (i)

9

0

Exceptional result (j = h – i)

10

0

Result for the financial year (g + j)

4 431

455

Source:Data compiled by the Centre.

Table 4

Translation Centre for the bodies of the European Union — Balance sheet at 31 December 2003 and 31 December 2002 (1)

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Intangible assets | 760 | 889 | Own capital | | |
| | | | Budget out-turn (a) | 4 404 | 8 330 |
| Tangible assets | | | Result of adjustments (b) | 27 | |
| Furniture and vehicles | 219 | 267 | Economic out-turn (a + b) | 4 431 | 8 330 |
| IT equipment | 398 | 486 | Out-turns carried over from previous financial years (2) | 1 642 | 1 642 |
| Fixed assets under construction and advances paid | 35 | 0 | Permanent pre-financing fund | 8 330 | |
| Subtotal | 652 | 753 | Subtotal | 14 403 | 9 972 |
| Current assets | | | Provisions for risks and liabilities | 8 601 | 6 406 |
| VAT paid and recoverable from the Member States | 3 | 25 | Short-term liabilities | | |
| Amounts owed by Community institutions and bodies | 2 676 | 3 360 | Amounts owed to Community institutions and bodies | 0 | 3 360 |
| Sundry receivables | 10 | 26 | Payment appropriations to be carried over | 784 | 1 247 |
| Subtotal | 2 689 | 3 411 | Sundry creditors | 162 | 15 |
| Disposable assets | 20 354 | 16 126 | Sundry liabilities | 5 | 15 |
| | | | Advances to customers | 500 | 164 |
| | | | Subtotal | 1 451 | 4 801 |
| Total | 24 455 | 21 179 | Total | 24 455 | 21 179 |
| Source:Data compiled by the Centre — This table summarises the data supplied by the Centre in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Intangible assets

760

889

Own capital

Budget out-turn (a)

4 404

8 330

Tangible assets

Result of adjustments (b)

27

Furniture and vehicles

219

267

Economic out-turn (a + b)

4 431

8 330

IT equipment

398

486

Out-turns carried over from previous financial years (2)

1 642

1 642

Fixed assets under construction and advances paid

35

0

Permanent pre-financing fund

8 330

Subtotal

652

753

Subtotal

14 403

9 972

Current assets

Provisions for risks and liabilities

8 601

6 406

VAT paid and recoverable from the Member States

3

25

Short-term liabilities

Amounts owed by Community institutions and bodies

2 676

3 360

Amounts owed to Community institutions and bodies

0

3 360

Sundry receivables

10

26

Payment appropriations to be carried over

784

1 247

Subtotal

2 689

3 411

Sundry creditors

162

15

Disposable assets

20 354

16 126

Sundry liabilities

5

15

Advances to customers

500

164

Subtotal

1 451

4 801

Total

24 455

21 179

Total

24 455

21 179

Source:Data compiled by the Centre — This table summarises the data supplied by the Centre in its own accounts.

---

(1)  The use of the model proposed by the Commission resulted in balances being reallocated under existing headings.

(2)  This amount actually corresponds to fixed assets after depreciation as at 31 December 2002 (see table 3 of the report concerning the financial year 2002, OJ C 319, 30.12.2003, p. 29).

Source:Data compiled by the Centre — This table summarises the data supplied by the Centre in its own accounts.

---

THE CENTRE'S REPLIES

| 7. | In principe, when there are changes to the methods used, the accounts for previous financial years should be drawn up using the new method. Nevertheless it was not possible for the Centre to make an objective evaluation of the effect of the change on previous years. The analysis of the impact of the change on the accounting for the financial year 2003 can be found in the annexes to the Centre's accounts. |
| --- | --- |

7.

In principe, when there are changes to the methods used, the accounts for previous financial years should be drawn up using the new method. Nevertheless it was not possible for the Centre to make an objective evaluation of the effect of the change on previous years. The analysis of the impact of the change on the accounting for the financial year 2003 can be found in the annexes to the Centre's accounts.

| 8. | In July 2004 the Centre signed a memorandum of understanding with the Luxembourg authorities resolving the problem of the costs of using the Nouvel Hémicycle building. With regard to the pension contributions for the Centre’s employees, renewed attempts will be made to find a solution. |
| --- | --- |

8.

In July 2004 the Centre signed a memorandum of understanding with the Luxembourg authorities resolving the problem of the costs of using the Nouvel Hémicycle building. With regard to the pension contributions for the Centre’s employees, renewed attempts will be made to find a solution.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/53 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/53

---

REPORT

on the annual accounts of the European Centre for the Development of Vocational Training for the 2003 financial year together with the Centre's replies

(2004/C 324/08)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-12 | OBSERVATIONS |
| --- | --- |

6-12

Tables 1 to 4

The Centre's replies

INTRODUCTION

| 1. | The European Centre for the Development of Vocational Training (the Centre) was established by Council Regulation (EEC) No 337/75 (1). Its core mandate is to serve the development of vocational training at Community level. In order to achieve this objective, it has the task of compiling and disseminating documentation on vocational training systems. The Centre's powers and activities are summarised, on the basis of information submitted by the Centre, in Table 1. |
| --- | --- |

1.

The European Centre for the Development of Vocational Training (the Centre) was established by Council Regulation (EEC) No 337/75 (1). Its core mandate is to serve the development of vocational training at Community level. In order to achieve this objective, it has the task of compiling and disseminating documentation on vocational training systems. The Centre's powers and activities are summarised, on the basis of information submitted by the Centre, in Table 1.

THE COURT'S OPINION

| 2. | This opinion is addressed to the Council and the European Parliament in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the Council and the European Parliament in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the Centre's annual accounts for the financial year ended 31 December 2003. In accordance with Article 12a(1) of Council Regulation (EEC) No 337/75, the Centre’s budget was implemented on the responsibility of its Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions provided for in Article 12 of the same Regulation. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to audit those accounts. |
| --- | --- |

3.

The Court has examined the Centre's annual accounts for the financial year ended 31 December 2003. In accordance with Article 12a(1) of Council Regulation (EEC) No 337/75, the Centre’s budget was implemented on the responsibility of its Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions provided for in Article 12 of the same Regulation. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to audit those accounts.

| 4. | The Court performed its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures that it considered necessary in that context. |
| --- | --- |

4.

The Court performed its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures that it considered necessary in that context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the audit opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003, and of the appropriations carried over from the previous year, is set out in Table 2. The Centre's revenue and expenditure account and balance sheet for the 2003 financial year are presented in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003, and of the appropriations carried over from the previous year, is set out in Table 2. The Centre's revenue and expenditure account and balance sheet for the 2003 financial year are presented in summary form in Tables 3 and 4.

| 7. | In 2003 the Centre received Phare subsidies and contributions from third countries (4) amounting to 791 844 euro. Contrary to the principles of budgetary unity and accuracy, the Centre did not use an amending budget to include the amount of these 2003 subsidies in its budget. |
| --- | --- |

7.

In 2003 the Centre received Phare subsidies and contributions from third countries (4) amounting to 791 844 euro. Contrary to the principles of budgetary unity and accuracy, the Centre did not use an amending budget to include the amount of these 2003 subsidies in its budget.

| 8. | The Centre's new financial regulation and the detailed rules for its implementation were adopted by the Management Board on 31 March 2003. These rules (5) specify that a new internal audit system is to be set up. Changes to the Centre's financial organisation and its accounting system were not yet complete at the end of the year. |
| --- | --- |

8.

The Centre's new financial regulation and the detailed rules for its implementation were adopted by the Management Board on 31 March 2003. These rules (5) specify that a new internal audit system is to be set up. Changes to the Centre's financial organisation and its accounting system were not yet complete at the end of the year.

| 9. | In accordance with Article 28(2)(e) of the Centre's financial regulation, the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. There has been no such validation. |
| --- | --- |

9.

In accordance with Article 28(2)(e) of the Centre's financial regulation, the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. There has been no such validation.

| 10. | The Centre has set up a ‘contracts unit’ to ensure that contracts to be awarded for studies are correct, but this unit is not informed about the procedures that are under way until the selection reports have been signed. It is unable to do anything to prevent irregularities at the initial stages (choice of procedure, examination of invitations to tender and publicity measures). Extending this unit's powers appears especially necessary insofar as a study of various files has brought to light inconsistencies and formal errors in the management of contract award procedures. |
| --- | --- |

10.

The Centre has set up a ‘contracts unit’ to ensure that contracts to be awarded for studies are correct, but this unit is not informed about the procedures that are under way until the selection reports have been signed. It is unable to do anything to prevent irregularities at the initial stages (choice of procedure, examination of invitations to tender and publicity measures). Extending this unit's powers appears especially necessary insofar as a study of various files has brought to light inconsistencies and formal errors in the management of contract award procedures.

| 11. | In 2003 the Centre had a list of potential contractors following a call for expressions of interest (CEI) which was issued in 2000. This list was drawn up and centralised under the authority of the permanent Chairman of the Evaluation Boards. By means of this list, the Centre was able to launch a restricted procedure among the potential contractors on the list, without the need to publish or declare selection criteria, up to a maximum value of around 163 000 euro (6). Five files on restricted procedures using CEIs were examined. In three cases (total contract value: 79 800 euro) giving rise to payments in 2003, the successful contractors did not appear on this list and no explanation was given for this situation. In view of this finding, the relevance of the existence of such a list of contractors could be called into question. The Court notes, moreover, that as the list has not been updated, the Centre gives a somewhat inconsistent picture of its selection procedures. |
| --- | --- |

11.

In 2003 the Centre had a list of potential contractors following a call for expressions of interest (CEI) which was issued in 2000. This list was drawn up and centralised under the authority of the permanent Chairman of the Evaluation Boards. By means of this list, the Centre was able to launch a restricted procedure among the potential contractors on the list, without the need to publish or declare selection criteria, up to a maximum value of around 163 000 euro (6). Five files on restricted procedures using CEIs were examined. In three cases (total contract value: 79 800 euro) giving rise to payments in 2003, the successful contractors did not appear on this list and no explanation was given for this situation. In view of this finding, the relevance of the existence of such a list of contractors could be called into question. The Court notes, moreover, that as the list has not been updated, the Centre gives a somewhat inconsistent picture of its selection procedures.

| 12. | On examination, recruitment files and a number of individual files were found to have formal and documentary shortcomings which prevented the necessary transparency with regard to the decisions taken on recruitment and the financial impact of those decisions when calculating pay. |
| --- | --- |

12.

On examination, recruitment files and a number of individual files were found to have formal and documentary shortcomings which prevented the necessary transparency with regard to the decisions taken on recruitment and the financial impact of those decisions when calculating pay.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 39, 13.2.1975, p. 1.

1

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

2

(3)  As required under Article 63 of the Centre's financial regulation, the final accounts for the financial year 2003 were drawn up on 1 September 2004 and forwarded to the Court of Auditors. They were received by the Court on 17 September 2004. A summarised version of these accounts is presented in the tables annexed to this report.

3

(4)  Participation by Norway.

4

(5)  Article 25 of the Centre's new financial regulation.

5

(6)  See Article 128(1) of the Regulation laying down detailed rules for the implementation of the financial regulation.

6

---

Table 1

European Centre for the Development of Vocational Training (Thessaloniki)

| Areas of Community competence deriving from the Treaty | Competence of the Centre as specified in Articles 2 and 3 of Council Regulation (EEC) No 337/75 of 10 February 1975 | Governance | Resources available to the Centre
  (2002 data) | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| The Community implements a vocational training policy to support and supplement the action of the Member States
  Action aims to:
  stimulate cooperation on training between educational or training establishments and firms,
  develop exchanges of information and experience on issues common to the training systems of the Member States

  (From Article 150 of the Treaty) | The Centre's mandate

  To assist the Commission in encouraging, at Community level, the promotion and development of vocational training and of in-service training and to contribute to the implementation of a common vocational training policy. | Tasks







  — | To compile selected documentation |

Areas of Community competence deriving from the Treaty

Competence of the Centre as specified in Articles 2 and 3 of Council Regulation (EEC) No 337/75 of 10 February 1975

Governance

Resources available to the Centre

(2002 data)

Products and services supplied in 2003

The Community implements a vocational training policy to support and supplement the action of the Member States

Action aims to:

stimulate cooperation on training between educational or training establishments and firms,

develop exchanges of information and experience on issues common to the training systems of the Member States

(From Article 150 of the Treaty)

The Centre's mandate

To assist the Commission in encouraging, at Community level, the promotion and development of vocational training and of in-service training and to contribute to the implementation of a common vocational training policy.

Tasks

—

To compile selected documentation

| — | to contribute to research |
| --- | --- |

—

to contribute to research

| — | to disseminate information |
| --- | --- |

—

to disseminate information

| — | to encourage and support any initiative likely to facilitate a concerted approach; |
| --- | --- |

—

to encourage and support any initiative likely to facilitate a concerted approach;

| — | to provide a forum for all those concerned. |
| --- | --- |

—

to provide a forum for all those concerned.

| 1. | Management Board

  Per Member State:






  — | one Government representative |
| --- | --- | --- |

1.

Management Board

Per Member State:

—

one Government representative

| — | one representative of employers' organisations |
| --- | --- |

—

one representative of employers' organisations

| — | one representative of employees' organisations |
| --- | --- |

—

one representative of employees' organisations

| — | three members representing the Commission |
| --- | --- |

—

three members representing the Commission

| 2. | Director

  Appointed by the Commission from a list of candidates submitted by the Management Board; carries out the decisions of the Management Board and is responsible for the day-to-day administration of the Centre |
| --- | --- |

2.

Director

Appointed by the Commission from a list of candidates submitted by the Management Board; carries out the decisions of the Management Board and is responsible for the day-to-day administration of the Centre

| 3. | External audit

  The European Court of Auditors |
| --- | --- |

3.

External audit

The European Court of Auditors

| 4. | Discharge

  Parliament, on the Council's recommendation |
| --- | --- |

4.

Discharge

Parliament, on the Council's recommendation

Final budget

14,7 (14,2) million euro. Community contribution: 98,6 % (96,5 %)

Staff numbers at 31 December 2003

Number of posts in establishment plan: 83 (83)

Posts occupied: 77+2 (79)

+46 (32) other staff (auxiliary contracts, seconded national experts, local employees, temporary replacements)

Total staff: 125 (111)

Assigned to the following duties:

operational: 66 (59) administrative: 38 (33)

mixed: 21 (19)

Conferences and seminars: 72

Studies: 65

Projects: 23

Participation in:

Copenhagen Process

e-Learning Programme, Leonardo da Vinci programme, social partners' joint action framework

Publications:

68 publications, Cedefop Info, electronic newsletter

Circulation of documents:

10 244 on request, 2 346 electronic newsletter subscriptions, 8 523 subscriptions to Cedefop Info

Maintenance and development of the Electronic Training Village

Participants in the study visits programme: 773

Source:information supplied by the Centre.

Table 2

European Centre for the Development of Vocational Training — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Allocation of expenditure | Appropriations in the final budget | Appropriations carried over from the previous financial year | Appropriations available
  (2003 budget and financial year 2002) |
| entered | committed | paid | carried over | cancelled | initial | paid | to be carried over | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 14,5 | 14,5 | Title I
  Staff | 8,0 | 8,0 | 7,6 | 0,4 | 0,0 | 0,3 | 0,3 | 0,0 | 0,0 | 8,3 | 8,3 | 7,8 | 0,4 | 0,1 |
| Financial and other revenue | 0,2 | 0,0 | Title II
  Administration | 1,2 | 1,1 | 0,8 | 0,4 | 0,0 | 0,3 | 0,3 | 0,0 | 0,0 | 1,5 | 1,5 | 1,1 | 0,4 | 0,0 |
| Subsidy from non-Member States | p.m. (1) | 0,2 | Title III
  Operating activities | 5,5 | 5,5 | 2,4 | 3,1 | 0,0 | 2,2 | 1,8 | 0,0 | 0,3 | 7,7 | 7,7 | 4,2 | 3,1 | 0,3 |
| PHARE assigned revenue | (2) | 0,6 | Assigned revenue PHARE and non-Member States | (2) | 0,8 | 0,5 | 0,2 | 0,0 | 0,2 | 0,1 | 0,1 | 0,0 | 0,2 | 1,0 | 0,6 | 0,4 | 0,0 |
| Total | 14,7 | 15,3 | Total | 14,7 | 15,4 | 11,3 | 4,2 | 0,0 | 3,1 | 2,5 | 0,1 | 0,4 | 17,8 | 18,5 | 13,8 | 4,3 | 0,4 |
| NB:The totals may contain differences due to the effects of rounding.

  Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Allocation of expenditure

Appropriations in the final budget

Appropriations carried over from the previous financial year

Appropriations available

(2003 budget and financial year 2002)

entered

committed

paid

carried over

cancelled

initial

paid

to be carried over

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies

14,5

14,5

Title I

Staff

8,0

8,0

7,6

0,4

0,0

0,3

0,3

0,0

0,0

8,3

8,3

7,8

0,4

0,1

Financial and other revenue

0,2

0,0

Title II

Administration

1,2

1,1

0,8

0,4

0,0

0,3

0,3

0,0

0,0

1,5

1,5

1,1

0,4

0,0

Subsidy from non-Member States

p.m. (1)

0,2

Title III

Operating activities

5,5

5,5

2,4

3,1

0,0

2,2

1,8

0,0

0,3

7,7

7,7

4,2

3,1

0,3

PHARE assigned revenue

(2)

0,6

Assigned revenue PHARE and non-Member States

(2)

0,8

0,5

0,2

0,0

0,2

0,1

0,1

0,0

0,2

1,0

0,6

0,4

0,0

Total

14,7

15,3

Total

14,7

15,4

11,3

4,2

0,0

3,1

2,5

0,1

0,4

17,8

18,5

13,8

4,3

0,4

NB:The totals may contain differences due to the effects of rounding.

Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts.

Table 3

European Centre for the Development of Vocational Training — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Commission subsidies | 14 500 | 12 135 |
| Revenue from previous financial years | 0 | 25 |
| Miscellaneous revenue | 3 | 3 |
| Assigned revenue (Phare and third countries) | 792 | 333 |
| Financial revenue | 0 | 50 |
| Total revenue (a) | 15 295 | 12 546 |
| Budgetary expenditure for the financial year |
| Staff — Title I of the budget |
| Payments | 7 554 | 7 570 |
| Appropriations carried over | 443 | 298 |
| Administration — Title II of the budget |
| Payments | 778 | 767 |
| Appropriations carried over | 358 | 345 |
| Operating activities — Title III of the budget (except for assigned revenue) |
| Payments | 2 381 | 2 491 |
| Appropriations carried over | 3 138 | 2 189 |
| Assigned revenue (Phare and third countries) |
| Payments | 546 | 0 |
| Appropriations carried over | 246 | 187 |
| Total expenditure (b) | 15 444 | 13 847 |
| Outturn for the financial year (a – b) | – 149 | –1 301 |
| Balance carried over from the previous financial year | – 545 | 532 |
| Appropriations carried over and cancelled | 399 | 215 |
| Sums for reuse from the previous financial year not used | 10 | 8 |
| Refunds to the Commission | – 716 | 0 |
| Exchange-rate differences | 8 | 1 |
| Balance for the financial year | – 993 | – 545 |
| Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts. |

(1000 euro)

2003

2002

Revenue

Commission subsidies

14 500

12 135

Revenue from previous financial years

0

25

Miscellaneous revenue

3

3

Assigned revenue (Phare and third countries)

792

333

Financial revenue

0

50

Total revenue (a)

15 295

12 546

Budgetary expenditure for the financial year

Staff — Title I of the budget

Payments

7 554

7 570

Appropriations carried over

443

298

Administration — Title II of the budget

Payments

778

767

Appropriations carried over

358

345

Operating activities — Title III of the budget (except for assigned revenue)

Payments

2 381

2 491

Appropriations carried over

3 138

2 189

Assigned revenue (Phare and third countries)

Payments

546

0

Appropriations carried over

246

187

Total expenditure (b)

15 444

13 847

Outturn for the financial year (a – b)

– 149

–1 301

Balance carried over from the previous financial year

– 545

532

Appropriations carried over and cancelled

399

215

Sums for reuse from the previous financial year not used

10

8

Refunds to the Commission

– 716

0

Exchange-rate differences

8

1

Balance for the financial year

– 993

– 545

Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts.

Table 4

European Centre for the Development of Vocational Training — Balance sheet at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets
   (3) | | | Fixed capital | | |
| Intangible fixed assets | 14 | 0 | Own capital | 5 704 | 6 007 |
| Buildings | 5 179 | 5 351 | Balance for the financial year | – 993 | – 545 |
| Equipment and furniture | 471 | 616 | Subtotal | 4 711 | 5 462 |
| Financial fixed assets, guarantee | 5 | 5 | Long-term liabilities | | |
| Subtotal | 5 669 | 5 972 | Liabilities on assigned revenue | 0 | 277 |
| Stocks | | | Subtotal | 0 | 277 |
| Office equipment | 35 | 35 | Current liabilities | | |
| Subtotal | 35 | 35 | Liabilities on assigned revenue not received | 315 | 661 |
| Long-term assets | | | Appropriations carried over against Titles I, II and III | 3 939 | 2 832 |
| Staff loans | 3 | 9 | Appropriations carried over against assigned revenue | 382 | 238 |
| Commission subsidy | 0 | 277 | Recoverable amounts | 0 | 1 615 |
| Subtotal | 3 | 286 | Sundry accounts payable | 86 | 121 |
| Current assets | | | VAT/other taxes | 90 | 73 |
| Commission | 315 | 2 276 | Bank interest to be returned to the EU | 64 | 0 |
| Other advances | 37 | 94 | Subtotal | 4 876 | 5 540 |
| Recoverable VAT | 34 | 23 | Suspense accounts | | |
| Sundry accounts receivable | 81 | 124 | Current payments | 0 | 226 |
| Subtotal | 467 | 2 517 | Sums to be reused | 157 | 229 |
| Cash accounts | | | Subtotal | 157 | 455 |
| Bank accounts (4) | 3 532 | 2 830 | | | |
| Cash | 5 | 4 | | | |
| Imprest account | 33 | 90 | | | |
| Subtotal | 3 570 | 2 924 | | | |
| Total | 9 744 | 11 734 | Total | 9 744 | 11 734 |
| Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets
   (3)

Fixed capital

Intangible fixed assets

14

0

Own capital

5 704

6 007

Buildings

5 179

5 351

Balance for the financial year

– 993

– 545

Equipment and furniture

471

616

Subtotal

4 711

5 462

Financial fixed assets, guarantee

5

5

Long-term liabilities

Subtotal

5 669

5 972

Liabilities on assigned revenue

0

277

Stocks

Subtotal

0

277

Office equipment

35

35

Current liabilities

Subtotal

35

35

Liabilities on assigned revenue not received

315

661

Long-term assets

Appropriations carried over against Titles I, II and III

3 939

2 832

Staff loans

3

9

Appropriations carried over against assigned revenue

382

238

Commission subsidy

0

277

Recoverable amounts

0

1 615

Subtotal

3

286

Sundry accounts payable

86

121

Current assets

VAT/other taxes

90

73

Commission

315

2 276

Bank interest to be returned to the EU

64

0

Other advances

37

94

Subtotal

4 876

5 540

Recoverable VAT

34

23

Suspense accounts

Sundry accounts receivable

81

124

Current payments

0

226

Subtotal

467

2 517

Sums to be reused

157

229

Cash accounts

Subtotal

157

455

Bank accounts (4)

3 532

2 830

Cash

5

4

Imprest account

33

90

Subtotal

3 570

2 924

Total

9 744

11 734

Total

9 744

11 734

Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts.

---

(1)  p.m.: token entry

(2)  Phare assigned revenue was not entered in the Centre's initial budget and did not give rise to an amending budget (see paragraph 7 of the report).

NB:The totals may contain differences due to the effects of rounding.

Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts.

(3)  Fixed assets are shown net. The figures for 2002 have therefore been recalculated for purposes of comparison.

(4)  The substantial volume of funds in bank accounts at the end of the financial year is due to the payments made by the Commission to finance transactions for which the appropriations were carried over to the following financial year.

Source:information supplied by the Centre. This table summarises the data provided by the Centre in its own accounts.

---

THE CENTRE’S REPLIES

| 7. | The Centre ought indeed to have formalised the receipt of funds relating to the subsidy from the non-member countries and to the ‘Phare’ contract by means of a supplementary and amending budget. |
| --- | --- |

7.

The Centre ought indeed to have formalised the receipt of funds relating to the subsidy from the non-member countries and to the ‘Phare’ contract by means of a supplementary and amending budget.

| 8. | The necessary financial adaptation due to the financial reform began in 2003 and should be completed in 2005. As regards the adaptation of the accounting system, the Centre is making the necessary changes in accordance with the priorities set. |
| --- | --- |

8.

The necessary financial adaptation due to the financial reform began in 2003 and should be completed in 2005. As regards the adaptation of the accounting system, the Centre is making the necessary changes in accordance with the priorities set.

| 9. | It is correct that the accounting system has still not been validated. This is due to the changes that must still be made to fully implement the accounting reform. The validation should take place in the course of 2005. |
| --- | --- |

9.

It is correct that the accounting system has still not been validated. This is due to the changes that must still be made to fully implement the accounting reform. The validation should take place in the course of 2005.

| 10. | The Reform and the complexity of procurement and contract management issues in conjunction with the difficulties presented by a decentralised modus operandi reinforced the need for a centralised system of procurement and contract management operations. In this regard, and following the Director's Decision 2004/1, the Legal and Contract Management Service is solely in charge of direct centralised procurement and contract management at Cedefop and in this capacity takes care of and transacts all formal, legal and administrative tasks related to all stages and aspects of procurement at Cedefop. Finally, and as evidenced by the documentation provided to the Court of Auditors, the Centre would like to stress that the procedures which led to the awarding of all contracts were in compliance with the applicable rules. |
| --- | --- |

10.

The Reform and the complexity of procurement and contract management issues in conjunction with the difficulties presented by a decentralised modus operandi reinforced the need for a centralised system of procurement and contract management operations. In this regard, and following the Director's Decision 2004/1, the Legal and Contract Management Service is solely in charge of direct centralised procurement and contract management at Cedefop and in this capacity takes care of and transacts all formal, legal and administrative tasks related to all stages and aspects of procurement at Cedefop. Finally, and as evidenced by the documentation provided to the Court of Auditors, the Centre would like to stress that the procedures which led to the awarding of all contracts were in compliance with the applicable rules.

| 11. | Regarding contracts 2002/0117 (EUR 22 483), 2002/0143 (EUR 25 000) and 2003/0069 (EUR 32 257,50), Cedefop would like to point out that (a) contracts 2002/0117 and 2002/0143 concern the year 2002, (b) contracts 2002/0117 and 2003/0069 were awarded to the same contractor, and (c) all contracts at issue here are low-value contracts.
  The lists of those invited to tender which led to the awarding of the three abovementioned contracts were based on the entire pool of qualified potential contractors resulting from the Call for Expressions of Interest Cedefop No AMI/VET/2000-1. As substantiated by data provided to the auditors, these invitations to tender were addressed to organisations/individuals selected on the basis of objective and non-discriminatory criteria specific to the nature of each contract, as foreseen in the applicable rules, and not to all potential contractors in the above pool. The contractors at issue here, as evidenced jure et facto by the data provided to the Court of Auditors, were accepted as qualified potential contractors in the framework of the aforementioned Call for Expressions of Interest. Even though their names did not appear on the list presented to the auditors (as a result of difficulties related to decentralised operations at that time), their status as qualified potential contractors cannot be disputed. The Centre would like to stress that the procedures which led to the awarding of the contracts at issue were in compliance with the applicable rules. |
| --- | --- |

11.

Regarding contracts 2002/0117 (EUR 22 483), 2002/0143 (EUR 25 000) and 2003/0069 (EUR 32 257,50), Cedefop would like to point out that (a) contracts 2002/0117 and 2002/0143 concern the year 2002, (b) contracts 2002/0117 and 2003/0069 were awarded to the same contractor, and (c) all contracts at issue here are low-value contracts.

The lists of those invited to tender which led to the awarding of the three abovementioned contracts were based on the entire pool of qualified potential contractors resulting from the Call for Expressions of Interest Cedefop No AMI/VET/2000-1. As substantiated by data provided to the auditors, these invitations to tender were addressed to organisations/individuals selected on the basis of objective and non-discriminatory criteria specific to the nature of each contract, as foreseen in the applicable rules, and not to all potential contractors in the above pool. The contractors at issue here, as evidenced jure et facto by the data provided to the Court of Auditors, were accepted as qualified potential contractors in the framework of the aforementioned Call for Expressions of Interest. Even though their names did not appear on the list presented to the auditors (as a result of difficulties related to decentralised operations at that time), their status as qualified potential contractors cannot be disputed. The Centre would like to stress that the procedures which led to the awarding of the contracts at issue were in compliance with the applicable rules.

| 12. | The observations will be taken into account in the drawing up or adaptation of internal procedures by the Administration. |
| --- | --- |

12.

The observations will be taken into account in the drawing up or adaptation of internal procedures by the Administration.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/61 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/61

---

REPORT

on the annual accounts of Eurojust for the 2003 financial year together with Eurojust's replies

(2004/C 324/09)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-9 | OBSERVATIONS |
| --- | --- |

6-9

Tables 1 to 4

Eurojust's replies

INTRODUCTION

| 1. | Eurojust, which became operational at the end of 2002, was set up by Council Decision No 2002/187/JHA (1) with a view to reinforcing the fight against serious 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. Table 1 contains a summary of Eurojust's powers and activities which is based on information provided by Eurojust itself. |
| --- | --- |

1.

Eurojust, which became operational at the end of 2002, was set up by Council Decision No 2002/187/JHA (1) with a view to reinforcing the fight against serious 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. Table 1 contains a summary of Eurojust's powers and activities which is based on information provided by Eurojust itself.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council pursuant to Article 36 of Council Decision No 2002/187/JHA (). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council pursuant to Article 36 of Council Decision No 2002/187/JHA ().

| 3. | The Court has examined the annual accounts of Eurojust for the financial year ended 31 December 2003. In accordance with Article 36 of Council Decision No 2002/187/JHA of 28 February 2002 (), the budget was implemented on the responsibility of Eurojust's Administrative Director. This responsibility includes the drawing-up and presentation of the accounts (2), in accordance with the internal financial provisions provided for in Article 37 of the Council Decision. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to audit these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of Eurojust for the financial year ended 31 December 2003. In accordance with Article 36 of Council Decision No 2002/187/JHA of 28 February 2002 (), the budget was implemented on the responsibility of Eurojust's Administrative Director. This responsibility includes the drawing-up and presentation of the accounts (2), in accordance with the internal financial provisions provided for in Article 37 of the Council Decision. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to audit these accounts.

| 4. | The Court carried out its audit in accordance with its auditing standards and policies. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures that it considered necessary in this context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing standards and policies. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures that it considered necessary in this context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call the opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions, taken as a whole, were legal and regular. The content of the following observations does not call the opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2. Eurojust's economic outturn account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003 and of the appropriations carried over from the previous financial year is shown in Table 2. Eurojust's economic outturn account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4.

| 7. | Eurojust was unable to adopt its new financial regulation during the financial year. Pending adoption, it has been applying the framework financial regulation for the decentralised bodies (3). The documentation describing the roles and tasks of those responsible for the internal control system is still unclear. Supporting documents for orders or for the receipt of goods and services are not all kept. |
| --- | --- |

7.

Eurojust was unable to adopt its new financial regulation during the financial year. Pending adoption, it has been applying the framework financial regulation for the decentralised bodies (3). The documentation describing the roles and tasks of those responsible for the internal control system is still unclear. Supporting documents for orders or for the receipt of goods and services are not all kept.

| 8. | Article 43(1)(e) of the framework financial regulation stipulates that the accounting officer shall validate the systems laid down by the authorising officer to supply or justify accounting information. No such validation took place during the financial year. |
| --- | --- |

8.

Article 43(1)(e) of the framework financial regulation stipulates that the accounting officer shall validate the systems laid down by the authorising officer to supply or justify accounting information. No such validation took place during the financial year.

| 9. | The management of transfers of appropriations must be monitored more closely. In one case, the Eurojust College was notified of a transfer of 349 500 euro even though the sum was already part of the amending budget presented a few weeks earlier. A transfer of 8 500 euro was entered in the budgetary accounts without the College being informed. |
| --- | --- |

9.

The management of transfers of appropriations must be monitored more closely. In one case, the Eurojust College was notified of a transfer of 349 500 euro even though the sum was already part of the amending budget presented a few weeks earlier. A transfer of 8 500 euro was entered in the budgetary accounts without the College being informed.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

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

1

(2)  As required under Article 36 of the Decision setting up Eurojust, the final accounts for the financial year 2003 were drawn up on 7 September 2004 and forwarded to the Parliament, the Commission and the Court of Auditors. The Court received them on 24 September 2004. A summarised version of these accounts is published in the tables annexed to this report.

2

(3)  Commission Regulation (EC, Euratom) No 2343/2002 of 19 December 2002 (OJ L 357, 31.12.2002, p. 72).

3

---

Table 1

Eurojust (The Hague) Council Decision of 28 February 2002 (2002/187/JHA)

| Areas of responsibility stipulated in the Treaty on European Union | Eurojust's powers as defined in the Council Decision of 28 February 2002 (2002/187/JHA) | Governance | Resources made available to Eurojust

  (Data for 2002 in brackets) | Activities and services provided

  (Data for 2002 in brackets) |
| --- | --- | --- | --- | --- |
| 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







  — | To stimulate and improve the coordination, between the competent national authorities of the Member States, of investigations and prosecutions and to improve cooperation, in particular by facilitating the exchange of information, mutual legal assistance and the implementation of extradition requests. |

Areas of responsibility stipulated in the Treaty on European Union

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

Governance

Resources made available to Eurojust

(Data for 2002 in brackets)

Activities and services provided

(Data for 2002 in brackets)

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

—

To stimulate and improve the coordination, between the competent national authorities of the Member States, of investigations and prosecutions and 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. |
| --- | --- |

—

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. |
| --- | --- |

—

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. |
| --- | --- |

—

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

Tasks

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

| — | through its national members |
| --- | --- |

—

through its national members

| — | or as a College. |
| --- | --- |

—

or 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. |
| --- | --- |

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 a prosecutor, judge or police officer of equivalent competence. |
| --- | --- |

2.

The College is composed of national members seconded by each Member State in accordance with its legal system, being a prosecutor, judge or police officer of equivalent competence.

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

3.

The College elects its President from among the national members.

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

4.

The Joint Supervisory Body checks the processing of personal data.

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

5.

The Administrative Director is unanimously appointed by the College.

| 6. | External control: the Court of Auditors. |
| --- | --- |

6.

External control: the Court of Auditors.

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

7.

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

Final budget:

8 million euro (2,8 million euro) funded in full (100 %) (100 %) by the EU:

Staff as at 31 December 2003:

53 (46) posts listed in the establishment plan

posts occupied: 28 (5)

+15(7) other posts (auxiliary contracts, seconded national experts, local staff, employment-agency staff)

Total staff: 43 (12)

carrying out

operational tasks: 18 (3)

administrative tasks: 20 (6)

mixed tasks: 5 (3)

Number of meetings: 26 (20)

Bilateral cases: 222 (144)

Multilateral cases: 78 (70)

Total number of cases: 300 (214)

Fraud: 22 % (30 %)

Drug-trafficking: 22 % (16 %)

Terrorism: 6 % (9 %)

Murder: 4 % (7 %)

Smuggling: 3 % (6 %)

Trafficking

in human beings: 4 % (6 %)

Money-laundering: 8 % (2 %)

Other: 31 % (24 %)

Source:Information supplied by Eurojust.

Table 2

Eurojust — Implementation of the budget for the 2003 financial year

| (million 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 | Available appropriations
  (2003 budget and the financial year 2002) |
| entered | committed | paid | carried over | cancelled | outstanding commitments | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 8,0 | 7,2 | Title I
  Staff | 2,5 | 2,2 | 2,0 | 0,2 | 0,3 | 0,0 | 0,0 | 0,0 | 2,5 | 2,2 | 2,0 | 0,2 | 0,3 |
| Financial interest | 0,0 | 0,0 | Title II
  Administration | 4,0 | 3,0 | 2,3 | 1,0 | 0,7 | 0,3 | 0,3 | 0,0 | 4,3 | 3,3 | 2,6 | 1,0 | 0,7 |
| Miscellaneous revenue | 0,1 | 0,0 | Title III
  Operational activities | 1,6 | 1,0 | 0,9 | 0,1 | 0,6 | 0,1 | 0,1 | 0,0 | 1,7 | 1,1 | 1,0 | 0,1 | 0,6 |
| Total | 8,1 | 7,2 | Total | 8,1 | 6,2 | 5,2 | 1,3 | 1,6 | 0,4 | 0,4 | 0,0 | 8,5 | 6,6 | 5,6 | 1,3 | 1,6 |
| Source:Eurojust data. This table summarises the data supplied by Eurojust in its own accounts. |

(million 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

Available appropriations

(2003 budget and the financial year 2002)

entered

committed

paid

carried over

cancelled

outstanding commitments

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies

8,0

7,2

Title I

Staff

2,5

2,2

2,0

0,2

0,3

0,0

0,0

0,0

2,5

2,2

2,0

0,2

0,3

Financial interest

0,0

0,0

Title II

Administration

4,0

3,0

2,3

1,0

0,7

0,3

0,3

0,0

4,3

3,3

2,6

1,0

0,7

Miscellaneous revenue

0,1

0,0

Title III

Operational activities

1,6

1,0

0,9

0,1

0,6

0,1

0,1

0,0

1,7

1,1

1,0

0,1

0,6

Total

8,1

7,2

Total

8,1

6,2

5,2

1,3

1,6

0,4

0,4

0,0

8,5

6,6

5,6

1,3

1,6

Source:Eurojust data. This table summarises the data supplied by Eurojust in its own accounts.

Table 3

Eurojust — Economic outturn accounts for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Operating revenue |
| Community subsidies | 7 125 | 1 478 |
| Miscellaneous revenue | 12 | 0 |
| Total (a) | 7 137 | 1 478 |
| Operating expenditure |
| Purchases of goods and services | 3 228 | 378 |
| Staff costs | 2 112 | 256 |
| Depreciation | 211 | 29 |
| Total (b) | 5 551 | 663 |
| Outturn for the financial year (a – b) | 1 586 | 815 |
| Source:Eurojust data. |

(1000 euro)

2003

2002

Operating revenue

Community subsidies

7 125

1 478

Miscellaneous revenue

12

0

Total (a)

7 137

1 478

Operating expenditure

Purchases of goods and services

3 228

378

Staff costs

2 112

256

Depreciation

211

29

Total (b)

5 551

663

Outturn for the financial year (a – b)

1 586

815

Source:Eurojust data.

Table 4

Eurojust — Balance sheet at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Intangible assets
   (1) | 62 | 6 | Own capital | | |
| | | | Budget outturn (a) | 778 | –80 |
| Fixed assets
   (1) | | | Result of adjustments (b) | 808 | 895 |
| Equipment, machinery and tools | 114 | 20 | Economic outturn (a + b) | 1 586 | 815 |
| Furniture and vehicles | 492 | 207 | Result carried over from previous years | 815 | 0 |
| Computer equipment | 460 | 451 | Subtotal | 2 401 | 815 |
| Subtotal | 1 066 | 678 | | | |
| | | | Provisions for risks and charges | 396 | 0 |
| Financial assets | 1 | 0 | | | |
| | | | Current liabilities | | |
| Current assets | | | Current liabilities | 24 | 173 |
| Current assets | 232 | 158 | Other liabilities | 305 | 125 |
| Sundry accounts receivable | 34 | 30 | Subtotal | 329 | 298 |
| Subtotal | 266 | 188 | | | |
| Disposable assets | 1 731 | 241 | | | |
| Total | 3 126 | 1 113 | Total | 3 126 | 1 113 |
| Source:Eurojust data. This table summarises the data supplied by Eurojust in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Intangible assets
   (1)

62

6

Own capital

Budget outturn (a)

778

–80

Fixed assets
   (1)

Result of adjustments (b)

808

895

Equipment, machinery and tools

114

20

Economic outturn (a + b)

1 586

815

Furniture and vehicles

492

207

Result carried over from previous years

815

0

Computer equipment

460

451

Subtotal

2 401

815

Subtotal

1 066

678

Provisions for risks and charges

396

0

Financial assets

1

0

Current liabilities

Current assets

Current liabilities

24

173

Current assets

232

158

Other liabilities

305

125

Sundry accounts receivable

34

30

Subtotal

329

298

Subtotal

266

188

Disposable assets

1 731

241

Total

3 126

1 113

Total

3 126

1 113

Source:Eurojust data. This table summarises the data supplied by Eurojust in its own accounts.

---

(1)  Intangible and fixed assets are depreciated on a monthly basis.

Source:Eurojust data. This table summarises the data supplied by Eurojust in its own accounts.

---

THE COURT’S REPLIES

| 7. | On 11 November 2003 the College of Eurojust adopted the proposal for a new Financial Regulation submitted to it by the Administrative Director and its text was forwarded to the Commission for approval.
  Eurojust has revised its guidelines on financial circuits and the separation of tasks and has finalised specific verification lists for each financial sector.
  Eurojust has decided to centralise all supporting documents in the unit responsible for budget and finance so as to avoid the risks associated with them being spread throughout the operational departments. |
| --- | --- |

7.

On 11 November 2003 the College of Eurojust adopted the proposal for a new Financial Regulation submitted to it by the Administrative Director and its text was forwarded to the Commission for approval.

Eurojust has revised its guidelines on financial circuits and the separation of tasks and has finalised specific verification lists for each financial sector.

Eurojust has decided to centralise all supporting documents in the unit responsible for budget and finance so as to avoid the risks associated with them being spread throughout the operational departments.

| 8. | Eurojust’s Accounting Officer took up his post in September 2003. The time required to settle and test the accounting systems meant that it was 2004 before they could be validated. |
| --- | --- |

8.

Eurojust’s Accounting Officer took up his post in September 2003. The time required to settle and test the accounting systems meant that it was 2004 before they could be validated.

| 9. | The experience gained in financial year 2003, Eurojust’s first complete financial year, exposed some weaknesses in the control of budgetary transactions. This has since been strengthened to avoid any repetition of the problems noted by the Court. |
| --- | --- |

9.

The experience gained in financial year 2003, Eurojust’s first complete financial year, exposed some weaknesses in the control of budgetary transactions. This has since been strengthened to avoid any repetition of the problems noted by the Court.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/68 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/68

---

REPORT

on the annual accounts of the European Training Foundation for the 2003 financial year together with the Foundation's replies

(2004/C 324/10)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-11 | OBSERVATIONS |
| --- | --- |

6-11

Tables 1 to 4

The Foundation's replies

INTRODUCTION

| 1. | The European Training Foundation (hereinafter called the Foundation) was created by Council Regulation (EEC) No 1360/90 of 7 May 1990 (1). The Foundation's purpose is to support the reform of vocational training in the European Union's partner countries. As such, it assists the Commission in the implementation of various programmes (Phare, Tacis, Cards, Meda). Table 1 summarises the powers and activities of the Foundation on the basis of information supplied by it. |
| --- | --- |

1.

The European Training Foundation (hereinafter called the Foundation) was created by Council Regulation (EEC) No 1360/90 of 7 May 1990 (1). The Foundation's purpose is to support the reform of vocational training in the European Union's partner countries. As such, it assists the Commission in the implementation of various programmes (Phare, Tacis, Cards, Meda). Table 1 summarises the powers and activities of the Foundation on the basis of information supplied by it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the annual accounts of the Foundation for the financial year ended 31 December 2003. In accordance with Article 11(1) of Council Regulation (EEC) No 1360/90, the budget was implemented on the responsibility of the Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted on the bases of Article 12 of the same regulation. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of the Foundation for the financial year ended 31 December 2003. In accordance with Article 11(1) of Council Regulation (EEC) No 1360/90, the budget was implemented on the responsibility of the Director. This responsibility includes the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted on the bases of Article 12 of the same regulation. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out the audit in accordance with its auditing policies and standards, which are adapted from international standards to reflect the Community context. |
| --- | --- |

4.

The Court carried out the audit in accordance with its auditing policies and standards, which are adapted from international standards to reflect the Community context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the opinion expressed by the Court in this report into question. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call the opinion expressed by the Court in this report into question.

OBSERVATIONS

| 6. | Table 2 shows the implementation of appropriations for the 2003 financial year and of appropriations carried over from the previous financial year. The Foundation's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4. |
| --- | --- |

6.

Table 2 shows the implementation of appropriations for the 2003 financial year and of appropriations carried over from the previous financial year. The Foundation's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4.

| 7. | On the basis of agreements concluded with the Commission, the Foundation manages Tempus programmes which also include technical assistance. In 2003, the Foundation made payments of 23,1 million euro on behalf of the Commission for those programmes and, on 31 December 2003, the balance of the relevant bank accounts amounted to 24,2 million euro. About 20 % of the staff employed by the Foundation work full-time on these programmes. As the Court mentioned in previous reports (4), no data relating to these programmes appear in the budget or in the balance sheet; the Foundation presents the relevant financial information in an annex to its annual accounts. This does not comply with the budgetary principles of unity and accuracy (5). |
| --- | --- |

7.

On the basis of agreements concluded with the Commission, the Foundation manages Tempus programmes which also include technical assistance. In 2003, the Foundation made payments of 23,1 million euro on behalf of the Commission for those programmes and, on 31 December 2003, the balance of the relevant bank accounts amounted to 24,2 million euro. About 20 % of the staff employed by the Foundation work full-time on these programmes. As the Court mentioned in previous reports (4), no data relating to these programmes appear in the budget or in the balance sheet; the Foundation presents the relevant financial information in an annex to its annual accounts. This does not comply with the budgetary principles of unity and accuracy (5).

| 8. | In 2003 the Foundation concluded two agreements with donors (total amount 0,5 million euro). These agreements are correctly disclosed in the accounts but the Foundation did not produce a supplementary and amending budget. |
| --- | --- |

8.

In 2003 the Foundation concluded two agreements with donors (total amount 0,5 million euro). These agreements are correctly disclosed in the accounts but the Foundation did not produce a supplementary and amending budget.

| 9. | Due to payment delays by the Commission, the Foundation was unable to meet its financial commitments. The Foundation had to make in November 2003 a temporary transfer of 1 million euro from bank accounts dedicated to the Tempus programme to its own bank accounts. This operation was done without informing either the Governing Board, or the Commission. |
| --- | --- |

9.

Due to payment delays by the Commission, the Foundation was unable to meet its financial commitments. The Foundation had to make in November 2003 a temporary transfer of 1 million euro from bank accounts dedicated to the Tempus programme to its own bank accounts. This operation was done without informing either the Governing Board, or the Commission.

| 10. | In accordance with Article 43(1) of the Foundation's financial regulation, the accounting officer is required to validate the systems put in place by the authorising officer on accounting information. This validation did not take place during the financial year. |
| --- | --- |

10.

In accordance with Article 43(1) of the Foundation's financial regulation, the accounting officer is required to validate the systems put in place by the authorising officer on accounting information. This validation did not take place during the financial year.

| 11. | An analysis of five selection procedures showed that the process for selecting candidates for the interview (pre-selection phase) is not formalised in a transparent way. In many cases the selection criteria are neither laid down before the interview, nor is their use documented in the files. |
| --- | --- |

11.

An analysis of five selection procedures showed that the process for selecting candidates for the interview (pre-selection phase) is not formalised in a transparent way. In many cases the selection criteria are neither laid down before the interview, nor is their use documented in the files.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 131, 23.5.1990

1

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

2

(3)  As required under Article 83(3) of the Foundation's financial regulation, the final accounts for the financial year 2003 were drawn up on September 8 2004 and forwarded to the Court of Auditors, which received them on September 20 2004. A summarised version of the accounts is presented in the tables annexed to this report.

3

(4)  Paragraph 9 of the report concerning the financial year 2002 (OJ C 319, 30.12.2003, p. 48), see also paragraph 8 of the report concerning the financial year 2001 (OJ C 326, 27.12.2002, p. 51) and paragraph 11 of the report concerning the financial year 1999 (OJ C 373, 27.12.2000, p. 34).

4

(5)  Article 6 of the Foundation's financial regulation.

5

---

Table 1

European Training Foundation (Torino)

| Competences following the Treaty | Competences following the Council's Regulation (CEE) No 1360/90 of 7 May 1990 | Governance | Means available to the Foundation (figures for 2002) | Products |
| --- | --- | --- | --- | --- |
| The Community shall carry out, within its spheres of competence, economic, financial and technical cooperation measures with third countries. Such measures shall be complementary to those carried out by the Member States and consistent with the development policy of the Community.

  (Article 181 A) | Objectives







  — | Contribute to the provision of training assistance to the countries of Central and Eastern Europe and Mongolia, to some countries of the Balkans area and to the countries and territories eligible to the MEDA programmes |

Competences following the Treaty

Competences following the Council's Regulation (CEE) No 1360/90 of 7 May 1990

Governance

Means available to the Foundation (figures for 2002)

Products

The Community shall carry out, within its spheres of competence, economic, financial and technical cooperation measures with third countries. Such measures shall be complementary to those carried out by the Member States and consistent with the development policy of the Community.

(Article 181 A)

Objectives

—

Contribute to the provision of training assistance to the countries of Central and Eastern Europe and Mongolia, to some countries of the Balkans area and to the countries and territories eligible to the MEDA programmes

| — | Promote the coordination of the assistance given to eligible countries. |
| --- | --- |

—

Promote the coordination of the assistance given to eligible countries.

Tasks

| — | Assistance to define the needs and priorities for training |
| --- | --- |

—

Assistance to define the needs and priorities for training

| — | Provision of informations on initiatives and future needs |
| --- | --- |

—

Provision of informations on initiatives and future needs

| — | Financing pilots projects |
| --- | --- |

—

Financing pilots projects

| — | Implementation of programmes of the Commission in eligible countries. |
| --- | --- |

—

Implementation of programmes of the Commission in eligible countries.

Governing board

| — | One representative of each Member State. |
| --- | --- |

—

One representative of each Member State.

| — | Two representatives of the Commission |
| --- | --- |

—

Two representatives of the Commission

Director

| — | Appointed by the Governing board on a proposal of the Commission |
| --- | --- |

—

Appointed by the Governing board on a proposal of the Commission

Advisory forum

| — | Appointed by the Governing board, |
| --- | --- |

—

Appointed by the Governing board,

| — | Two experts from each Member State, |
| --- | --- |

—

Two experts from each Member State,

| — | Two experts from each eligible country, |
| --- | --- |

—

Two experts from each eligible country,

| — | Two experts from the social partners at European level, |
| --- | --- |

—

Two experts from the social partners at European level,

Financial external control

European Court of Auditors

Discharge

European Parliament on recommendation of the Council.

Budget:

EUR 17,2 mio (EUR 16,8 mio) entirely financed by the Commission.

Staff at 31 of december 2003:

| — | 104 (130) posts in the establishment plan of which 99 (94) posts occupied |
| --- | --- |

—

104 (130) posts in the establishment plan of which 99 (94) posts occupied

| — | 31 (35) other employees (auxiliaries, national experts, interimaires) Total staff occupied: 130 (129) of which employed for: |
| --- | --- |

—

31 (35) other employees (auxiliaries, national experts, interimaires) Total staff occupied: 130 (129) of which employed for:

| — | operational tasks: 80 (78) |
| --- | --- |

—

operational tasks: 80 (78)

| — | administrative tasks: 35 (33) |
| --- | --- |

—

administrative tasks: 35 (33)

| — | mixed tasks: 15 (18). |
| --- | --- |

—

mixed tasks: 15 (18).

Assistance to the Commission:

ETF support covers a wide range of areas including: initial vocational education; lifelong learning; continuing (adult) training; human resource development in companies; employment policies; training of unmployed people; poverty alleviation and social inclusion and training to encourage local development.

Network of observatories in eligible countries:

Country sector studies, statistics on education, policy advice to countries.

Technical Assistance conventions with Cards, Meda and Tacis for Tempus scheme covering:

| — | Joint European Projects (JEP): applications received 507; funded 129 |
| --- | --- |

—

Joint European Projects (JEP): applications received 507; funded 129

| — | Structural and Complementary Measures (SCM) applications received 36; funded 12 |
| --- | --- |

—

Structural and Complementary Measures (SCM) applications received 36; funded 12

| — | Individual Mobility Grants applications received 1 246; funded 286. |
| --- | --- |

—

Individual Mobility Grants applications received 1 246; funded 286.

Management of activities of Tempus covers the standard functions of contract management, desk monitoring and overall support to projects in progress. 1 149 annual grants were issued to run Tempus projects and 255 reports were assessed. Several hundred Tempus projects received support and advice.

Source:Information provided by the Foundation.

Table 2

European Training Foundation — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Source of revenue | Revenue entered in the final budget for the financial year | Revenue received | Allocation of expenditure | Final budget appropriations | Appropriations carried over from the previous financial year | Appropriations available |
| entered | committed | paid | carried over | cancelled | commitments outstanding | paid | cancelled | Appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 17,2 | 18,1 | Title I
  Staff | 11,2 | 11,1 | 10,8 | 0,3 | 0,1 | 0,2 | 0,2 | 0,0 | 11,4 | 11,3 | 11,0 | 0,3 | 0,1 |
| Other subsidies | 0,0 | 0,5 | Title II
  Administration | 1,4 | 1,4 | 1,1 | 0,3 | 0,0 | 0,6 | 0,5 | 0,1 | 2,0 | 2,0 | 1,6 | 0,3 | 0,1 |
| Other revenue | (1) | 0,0 | Title III
  Operating activities | 4,6 | 4,5 | 3,4 | 1,1 | 0,1 | 2,6 | 2,3 | 0,3 | 7,2 | 7,1 | 5,7 | 1,1 | 0,4 |
| | | | Earmaked revenues (1) | 0,5 | 0,5 | 0,2 | 0,3 | 0,0 | 0,3 | 0,3 | 0,0 | 0,8 | 0,5 | 0,5 | 0,3 | 0,0 |
| Total | 17,2 | 18,6 | Total | 17,7 | 17,5 | 15,5 | 2,0 | 0,2 | 3,7 | 3,3 | 0,4 | 21,4 | 20,9 | 18,8 | 2,0 | 0,6 |
| NB:Any discrepancies in totals are due to the effects of rounding.

  Source:Foundation data. This table summarise the data supplied by the Foundation in its own accounts. |

(million euro)

Revenue

Expenditure

Source of revenue

Revenue entered in the final budget for the financial year

Revenue received

Allocation of expenditure

Final budget appropriations

Appropriations carried over from the previous financial year

Appropriations available

entered

committed

paid

carried over

cancelled

commitments outstanding

paid

cancelled

Appropriations

committed

paid

carried over

cancelled

Community subsidies

17,2

18,1

Title I

Staff

11,2

11,1

10,8

0,3

0,1

0,2

0,2

0,0

11,4

11,3

11,0

0,3

0,1

Other subsidies

0,0

0,5

Title II

Administration

1,4

1,4

1,1

0,3

0,0

0,6

0,5

0,1

2,0

2,0

1,6

0,3

0,1

Other revenue

(1)

0,0

Title III

Operating activities

4,6

4,5

3,4

1,1

0,1

2,6

2,3

0,3

7,2

7,1

5,7

1,1

0,4

Earmaked revenues (1)

0,5

0,5

0,2

0,3

0,0

0,3

0,3

0,0

0,8

0,5

0,5

0,3

0,0

Total

17,2

18,6

Total

17,7

17,5

15,5

2,0

0,2

3,7

3,3

0,4

21,4

20,9

18,8

2,0

0,6

NB:Any discrepancies in totals are due to the effects of rounding.

Source:Foundation data. This table summarise the data supplied by the Foundation in its own accounts.

Table 3

European Training Foundation — Revenue and expenditure account for the financial years 2003 and 2002 (2)

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Commission subsidies | 18 100 | 13 179 |
| Other donors | 523 | — |
| Miscellaneous revenue | 17 | 23 |
| Financial revenue | — | 140 |
| Total revenue (a) | 18 640 | 13 342 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 10 771 | 10 153 |
| Appropriations carried over | 329 | 215 |
| Administration — Title II of the budget |
| Payments | 1 076 | 805 |
| Appropriations carried over | 310 | 559 |
| Operating activities — Title III of the budget |
| Payments | 3 396 | 2 307 |
| Appropriations carried over | 1 087 | 2 591 |
| Earmarked revenues |
| Payments | 237 | — |
| Appropriations carried over | 286 | — |
| Total expenditure (b) | 17 492 | 16 631 |
| Outturn for the financial year(a – b) | 1 148 | –3 289 |
| Balance carried over from the previous financial year | –2 155 | 4 055 |
| Appropriations carried over and cancelled | 375 | 424 |
| Reimbursements to the Commission | – 703 | –3 352 |
| Exchange-rate differences | 17 | 6 |
| Balance for the financial year | –1 318 | –2 155 |
| Source:Foundation data. This table summarise the date supplied by the Foundation in its own accounts. |

(1000 euro)

2003

2002

Revenue

Commission subsidies

18 100

13 179

Other donors

523

—

Miscellaneous revenue

17

23

Financial revenue

—

140

Total revenue (a)

18 640

13 342

Expenditure

Staff — Title I of the budget

Payments

10 771

10 153

Appropriations carried over

329

215

Administration — Title II of the budget

Payments

1 076

805

Appropriations carried over

310

559

Operating activities — Title III of the budget

Payments

3 396

2 307

Appropriations carried over

1 087

2 591

Earmarked revenues

Payments

237

—

Appropriations carried over

286

—

Total expenditure (b)

17 492

16 631

Outturn for the financial year(a – b)

1 148

–3 289

Balance carried over from the previous financial year

–2 155

4 055

Appropriations carried over and cancelled

375

424

Reimbursements to the Commission

– 703

–3 352

Exchange-rate differences

17

6

Balance for the financial year

–1 318

–2 155

Source:Foundation data. This table summarise the date supplied by the Foundation in its own accounts.

Table 4

European Training Foundation — Balance sheet at 31 December 2003 and 31 December 2002 (3)

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Intangible fixed assets
   (4) | | | Fixed capital | | |
| Occupational rights | 5 000 | 5 000 | Own capital | 3 852 | 4 059 |
| Software licences | 146 | — | Balance for the financial year | –1 318 | –2 155 |
| Depreciation | –1 611 | –1 333 | Subtotal | 2 534 | 1 904 |
| Subtotal | 3 535 | 3 667 | Current liabilities | | |
| Tangible fixed assets | | | Automatic carry-overs of appropriations | 1 726 | 3 366 |
| Equipment and furniture | 273 | 618 | Automatic carry-overs of earmarked revenues | 286 | 273 |
| Computer equipment | 1 438 | 1 235 | Other contributors | 30 | 85 |
| Depreciation | –1 444 | –1 521 | Sundry accounts payable | 1 | 28 |
| Subtotal | 267 | 332 | Deferred revenue | 83 | 3 537 |
| Stocks | | | Subtotal | 2 126 | 7 289 |
| Office equipment | 50 | 60 | | | |
| Subtotal | 50 | 60 | | | |
| Current assets | | | | | |
| Commission subsidy receivable | 0 | 3 366 | | | |
| Other advances | 4 | 2 | | | |
| Recovery orders | 43 | 171 | | | |
| Sundry accounts receivable | 39 | 30 | | | |
| Subtotal | 86 | 3 569 | | | |
| Cash accounts | | | | | |
| Bank accounts | 719 | 1 524 | | | |
| Imprest account | 3 | 41 | | | |
| Subtotal | 722 | 1 565 | | | |
| Total | 4 660 | 9 193 | Total | 4 660 | 9 193 |
| Source:Foundation data. This table summarise the date supplied by the Foundation in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Intangible fixed assets
   (4)

Fixed capital

Occupational rights

5 000

5 000

Own capital

3 852

4 059

Software licences

146

—

Balance for the financial year

–1 318

–2 155

Depreciation

–1 611

–1 333

Subtotal

2 534

1 904

Subtotal

3 535

3 667

Current liabilities

Tangible fixed assets

Automatic carry-overs of appropriations

1 726

3 366

Equipment and furniture

273

618

Automatic carry-overs of earmarked revenues

286

273

Computer equipment

1 438

1 235

Other contributors

30

85

Depreciation

–1 444

–1 521

Sundry accounts payable

1

28

Subtotal

267

332

Deferred revenue

83

3 537

Stocks

Subtotal

2 126

7 289

Office equipment

50

60

Subtotal

50

60

Current assets

Commission subsidy receivable

0

3 366

Other advances

4

2

Recovery orders

43

171

Sundry accounts receivable

39

30

Subtotal

86

3 569

Cash accounts

Bank accounts

719

1 524

Imprest account

3

41

Subtotal

722

1 565

Total

4 660

9 193

Total

4 660

9 193

Source:Foundation data. This table summarise the date supplied by the Foundation in its own accounts.

---

(1)  Earmarked revenues have not been included in the budget (see paragraph 8 of the report).

NB:Any discrepancies in totals are due to the effects of rounding.

Source:Foundation data. This table summarise the data supplied by the Foundation in its own accounts.

(2)  The revenue and expenditure account and balance sheet only take account of the Foundation's specific activities: they do not include programmes managed on behalf of the Commission.

Source:Foundation data. This table summarise the date supplied by the Foundation in its own accounts.

(3)  The revenue and expenditure account and balance sheet only take account of the Foundation's specific activities: they don't include programmes managed on behalf of the Commission.

(4)  The Foundation paid to the owner of its building five millions euros for its renovation. This payment gives the Foundation the right to use the building for one euro per year during 30 years from 1995 on. This item has been taken into account for the first time in 2003. The figure for year 2002 has been restated accordingly.

Source:Foundation data. This table summarise the date supplied by the Foundation in its own accounts.

---

THE FOUNDATION'S REPLIES

| 7. | At the time the Annual Accounts for 2003 were first drawn up, it was not clear yet under which rules the Tempus conventions had to be reported in the budget and in other financial statements. ETF decided to report about these amounts in detail in an annex, while coming to a clear agreement with the Commission services on the presentation of accounts 2005.
  A meeting of agencies' accountants organised by the Commission and held on 11 June 2004 in Brussels gave concrete guidance on new accounting methodologies to apply to funds managed on behalf of the Commission which will be followed as of first January 2005 onwards. |
| --- | --- |

7.

At the time the Annual Accounts for 2003 were first drawn up, it was not clear yet under which rules the Tempus conventions had to be reported in the budget and in other financial statements. ETF decided to report about these amounts in detail in an annex, while coming to a clear agreement with the Commission services on the presentation of accounts 2005.

A meeting of agencies' accountants organised by the Commission and held on 11 June 2004 in Brussels gave concrete guidance on new accounting methodologies to apply to funds managed on behalf of the Commission which will be followed as of first January 2005 onwards.

| 8. | ETF takes note of the Court’s remark. From 2004 onward, any donation will be integrated into an amended budget which will be submitted for approval to the Governing Board and subsequently published. |
| --- | --- |

8.

ETF takes note of the Court’s remark. From 2004 onward, any donation will be integrated into an amended budget which will be submitted for approval to the Governing Board and subsequently published.

| 9. | ETF takes note of the Court’s remark. A second occurrence happened in January 2004 when the first instalment of ETF 2004 subvention could not be paid to ETF in time. ETF had again to rely on a temporary transfer out of Tempus funds to overcome an urgent financial shortfall.
  Learning from the previous occurrence, ETF formally informed the Commission and the chairman of the Governing Board through a letter dated 16 January 2004. Since that date, an arrangement has been agreed with the Commission to reduce the risk that such situations arise in the future. |
| --- | --- |

9.

ETF takes note of the Court’s remark. A second occurrence happened in January 2004 when the first instalment of ETF 2004 subvention could not be paid to ETF in time. ETF had again to rely on a temporary transfer out of Tempus funds to overcome an urgent financial shortfall.

Learning from the previous occurrence, ETF formally informed the Commission and the chairman of the Governing Board through a letter dated 16 January 2004. Since that date, an arrangement has been agreed with the Commission to reduce the risk that such situations arise in the future.

| 10. | The Accounting Officer validated the systems with a note in June 2004. |
| --- | --- |

10.

The Accounting Officer validated the systems with a note in June 2004.

| 11. | Since April 2004, applications are stored in a computerised database, where the screening of candidates against eligibility criteria is recorded. Eligible candidates are then assessed independently by each of the members of the selection committee, against pre-defined criteria. The shortlist of the candidates to be interviewed is the result of the average score of these independent assessments. Also the performance of interviewed candidates is scored independently by each member of the selection committee, against pre-defined criteria. A more systematic and comprehensive documentation of all steps is kept on file. |
| --- | --- |

11.

Since April 2004, applications are stored in a computerised database, where the screening of candidates against eligibility criteria is recorded. Eligible candidates are then assessed independently by each of the members of the selection committee, against pre-defined criteria. The shortlist of the candidates to be interviewed is the result of the average score of these independent assessments. Also the performance of interviewed candidates is scored independently by each member of the selection committee, against pre-defined criteria. A more systematic and comprehensive documentation of all steps is kept on file.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/75 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/75

---

REPORT

on the financial statements of the European Foundation for the Improvement of Living and Working Conditions for the 2003 financial year together with the Foundation's replies

(2004/C 324/11)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-12 | OBSERVATIONS |
| --- | --- |

6-12

Tables 1 to 4

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. Table 1 summarises the powers and activities of the Foundation on the basis of information supplied by it. |
| --- | --- |

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. Table 1 summarises the powers and activities of the Foundation on the basis of information supplied by it.

THE COURT'S OPINION

| 2. | This report is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This report is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the Foundation's annual accounts for the financial year ended 31 December 2003. In accordance with Article 16 of Council Regulation (EEC) No 1365/75, the budget was implemented on the responsibility of its Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions provided for in the same article. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the Foundation's annual accounts for the financial year ended 31 December 2003. In accordance with Article 16 of Council Regulation (EEC) No 1365/75, the budget was implemented on the responsibility of its Director. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions provided for in the same article. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in this context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in this context.

| 5. | The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions were, taken as a whole, legal and regular. The content of the observations which follow does not call into question the audit opinion expressed by the Court in this report. |
| --- | --- |

5.

The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 were reliable and that the underlying transactions were, taken as a whole, legal and regular. The content of the observations which follow does not call into question the audit opinion expressed by the Court in this report.

OBSERVATIONS

| 6. | Table 2 shows the implementation of appropriations for the financial year 2003 and the appropriations carried over from the previous financial year. The Foundation's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4. |
| --- | --- |

6.

Table 2 shows the implementation of appropriations for the financial year 2003 and the appropriations carried over from the previous financial year. The Foundation's revenue and expenditure account and the balance sheet for the financial year 2003 are summarised in Tables 3 and 4.

| 7. | The Foundation signed an agreement with the Commission in the context of the Phare programme. Under this agreement, the Foundation received an allocation of one million euro, of which 639 000 euro were received in 2003. These funds were managed outside the budget. An amending budget should have been drawn up. |
| --- | --- |

7.

The Foundation signed an agreement with the Commission in the context of the Phare programme. Under this agreement, the Foundation received an allocation of one million euro, of which 639 000 euro were received in 2003. These funds were managed outside the budget. An amending budget should have been drawn up.

| 8. | The revenue and expenditure account shows a loss which has accumulated over several financial years and which the Foundation has asked the Commission to reimburse. The Commission has regarded the corresponding payment as part of the subsidy for the financial year 2003, which means that the loss has not been discharged. Under the new provisions of the Foundation's financial regulation, if the balance of the outturn account for a particular year is negative, an amending budget (4) must be drawn up for the following year. |
| --- | --- |

8.

The revenue and expenditure account shows a loss which has accumulated over several financial years and which the Foundation has asked the Commission to reimburse. The Commission has regarded the corresponding payment as part of the subsidy for the financial year 2003, which means that the loss has not been discharged. Under the new provisions of the Foundation's financial regulation, if the balance of the outturn account for a particular year is negative, an amending budget (4) must be drawn up for the following year.

| 9. | The Foundation's new financial regulation and its implementing rules were adopted by the Governing Board on 28 March 2003. These rules (5) provide for the introduction of a new internal control system (including internal audit), which was not finalised until the beginning of 2004. |
| --- | --- |

9.

The Foundation's new financial regulation and its implementing rules were adopted by the Governing Board on 28 March 2003. These rules (5) provide for the introduction of a new internal control system (including internal audit), which was not finalised until the beginning of 2004.

| 10. | Article 43(1)(e) of the Foundation's financial regulation provides that the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. This validation did not take place during the financial year. |
| --- | --- |

10.

Article 43(1)(e) of the Foundation's financial regulation provides that the accounting officer is to validate the systems laid down by the authorising officer to supply or justify accounting information. This validation did not take place during the financial year.

| 11. | According to the basic regulation drawn up in 1975, the Foundation's principal aim is to contribute to the establishment of better living and working conditions by increasing and disseminating knowledge which is relevant to this subject. In particular, the Foundation is required to consider the following areas: man at work, organisation of work, problems peculiar to certain categories of workers, long-term aspects of the improvement of the environment and the distribution of human activities in space and in time. Certain aspects of these subjects have in practice been dealt with by other Agencies which have been set up since then (European Environment Agency, European Agency for Safety and Health at Work). The Foundation on the other hand has developed the analysis of other, more specific, aspects such as industrial relations. |
| --- | --- |

11.

According to the basic regulation drawn up in 1975, the Foundation's principal aim is to contribute to the establishment of better living and working conditions by increasing and disseminating knowledge which is relevant to this subject. In particular, the Foundation is required to consider the following areas: man at work, organisation of work, problems peculiar to certain categories of workers, long-term aspects of the improvement of the environment and the distribution of human activities in space and in time. Certain aspects of these subjects have in practice been dealt with by other Agencies which have been set up since then (European Environment Agency, European Agency for Safety and Health at Work). The Foundation on the other hand has developed the analysis of other, more specific, aspects such as industrial relations.

| 12. | The Foundation's activities are governed by four-year rolling programmes, the most recent of which covers the period 2001 to 2004. While the main aim of the most recent programme was to achieve a greater concentration on certain key areas, in 2002 the Foundation added a further area to the three already selected. The planning of the Foundation's work programme ought to be reviewed in consultation with the other Agencies that deal with subjects related to its area of activity so as to ensure that the basic priorities are well covered, to develop possible synergies and to avoid repeating work already carried out. The review of the Foundation's basic regulation which has been proposed by the Commission ought to be the occasion to do it. |
| --- | --- |

12.

The Foundation's activities are governed by four-year rolling programmes, the most recent of which covers the period 2001 to 2004. While the main aim of the most recent programme was to achieve a greater concentration on certain key areas, in 2002 the Foundation added a further area to the three already selected. The planning of the Foundation's work programme ought to be reviewed in consultation with the other Agencies that deal with subjects related to its area of activity so as to ensure that the basic priorities are well covered, to develop possible synergies and to avoid repeating work already carried out. The review of the Foundation's basic regulation which has been proposed by the Commission ought to be the occasion to do it.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

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

1

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

2

(3)  As required under Article 83(3) of the Foundation's financial regulation, the final accounts for the financial year 2003 were drawn up on 3 September 2004 and forwarded to the Court of Auditors, which received them on 24 September 2004. A summarised version of the accounts is presented in the tables annexed to this report.

3

(4)  Article 16 of the new financial regulation.

4

(5)  Article 38 of the Foundation's new financial regulation.

5

---

Table 1

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

| Areas of Community competence deriving from the Treaty | Competence of the Foundation as defined in Council Regulation
  (EEC) No 1365/75 of26 May 1975 | Governance | Resources available to the Foundation (data for 2002) | Products and services |
| --- | --- | --- | --- | --- |
| 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...

  (Extracts from 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

Competence of the Foundation as defined in Council Regulation

(EEC) No 1365/75 of26 May 1975

Governance

Resources available to the Foundation (data for 2002)

Products and services

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...

(Extracts from 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,

| — | organisation of work and particularly job design |
| --- | --- |

—

organisation of work and particularly job design

| — | problems peculiar to certain categories of workers |
| --- | --- |

—

problems peculiar to certain categories of workers

| — | long-term aspects of the improvement of the environment |
| --- | --- |

—

long-term aspects of the improvement of the environment

| — | the distribution of human activities in space and in time |
| --- | --- |

—

the distribution of human activities in space and in time

Tasks

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

—

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 |
| --- | --- |

—

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 |
| --- | --- |

—

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. |
| --- | --- |

—

To cooperate as closely as possible with existing specialised institutes.

| 1. | Administrative Board







  — | from each Member State: one government representative, one representative from employers' organisations and one workers' representative |
| --- | --- | --- |

1.

Administrative Board

—

from each Member State: one government representative, one representative from employers' organisations and one workers' representative

| — | Three representatives from the Commission. |
| --- | --- |

—

Three representatives from the Commission.

| 2. | Director







  — | appointed by the Commission from a list of candidates submitted by the Administrative Board, he implements the decisions of the Administrative Board and directs the Foundation. |
| --- | --- | --- |

2.

Director

—

appointed by the Commission from a list of candidates submitted by the Administrative Board, he implements the decisions of the Administrative Board and directs the Foundation.

| 3. | The Committee of Experts is composed of 15 members appointed by the Council on a proposal from the Commission, gives opinions in particular on the work programme. |
| --- | --- |

3.

The Committee of Experts is composed of 15 members appointed by the Council on a proposal from the Commission, gives opinions in particular on the work programme.

| 4. | External audit:

  Court of Auditors |
| --- | --- |

4.

External audit:

Court of Auditors

| 5. | Discharge given by the Parliament on a recommendation by the Council. |
| --- | --- |

5.

Discharge given by the Parliament on a recommendation by the Council.

Final budget

16,8 million euro (17,39 million euro) including Community contribution: 98,2 % (98,3 %)

Staff numbers at 31 December 2003:

88 (88) posts in the establishment plan

Posts occupied: 76 (77)

+16(20) other posts (auxiliary contracts, national experts on secondment, local staff, employment agency staff)

Total staff: 92 (97)

Assigned to the following duties:

| — | operational: 60 (61) |
| --- | --- |

—

operational: 60 (61)

| — | administrative: 28 (32) |
| --- | --- |

—

administrative: 28 (32)

| — | mixed: 4 (4) |
| --- | --- |

—

mixed: 4 (4)

Living conditions

| — | Survey of the quality of life in Europe (28 countries covered, 26 000 interviews) |
| --- | --- |

—

Survey of the quality of life in Europe (28 countries covered, 26 000 interviews)

| — | Maintenance and extension of a base of comparable data (Member States and candidate countries) |
| --- | --- |

—

Maintenance and extension of a base of comparable data (Member States and candidate countries)

| — | Study of employment in health care services |
| --- | --- |

—

Study of employment in health care services

| — | Study relating to a new organisation of time over working life. |
| --- | --- |

—

Study relating to a new organisation of time over working life.

Working conditions

| — | Report on working conditions in the acceding and candidate countries |
| --- | --- |

—

Report on working conditions in the acceding and candidate countries

| — | Creation of a network of experts for the new European Working Conditions Observatory (EWCO) |
| --- | --- |

—

Creation of a network of experts for the new European Working Conditions Observatory (EWCO)

| — | Studies relating to the hotel and catering and road transport sectors |
| --- | --- |

—

Studies relating to the hotel and catering and road transport sectors

| — | Inventory of existing surveys of living and working conditions. |
| --- | --- |

—

Inventory of existing surveys of living and working conditions.

Industrial relations

| — | Development of indicators in the field of financial participation |
| --- | --- |

—

Development of indicators in the field of financial participation

| — | Study relating to migration and employment |
| --- | --- |

—

Study relating to migration and employment

| — | Expansion of the ‘European Industrial Relations Observatory’ network (EIRO) |
| --- | --- |

—

Expansion of the ‘European Industrial Relations Observatory’ network (EIRO)

| — | Joint report with the Commission: ‘Development of industrial relations in 2002’ |
| --- | --- |

—

Joint report with the Commission: ‘Development of industrial relations in 2002’

| — | Case studies of European Company Committees in 37 multinational companies. |
| --- | --- |

—

Case studies of European Company Committees in 37 multinational companies.

European Monitoring Centre on Change (EMCC)

| — | Development of electronic publications |
| --- | --- |

—

Development of electronic publications

| — | Organisation of four seminars and two workshops. |
| --- | --- |

—

Organisation of four seminars and two workshops.

Transversal projects

| — | Report on corporate social responsibility (CSR). |
| --- | --- |

—

Report on corporate social responsibility (CSR).

Information and communication

| — | Communication activities in the Member States and candidate countries |
| --- | --- |

—

Communication activities in the Member States and candidate countries

| — | Establishment of seven national liaison centres |
| --- | --- |

—

Establishment of seven national liaison centres

| — | 91 publications (this figure does not include translations). |
| --- | --- |

—

91 publications (this figure does not include translations).

Source:Information supplied by the Foundation.

Table 2

European Foundation for the Improvement of Living and Working Conditions — Implementation of the budget for the 2003 inancial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Expenditure allocation | Appropriations in the final budget | Appropriations carried over from the previous financial year | Available appropriations
  (appropriations for the current financial year and appropriations carried over from the previous financial year) |
| entered | committed | paid | carried over | cancelled | outstanding commitments | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 16,5 | 17,1 | Title I
  Staff | 9,0 | 9,0 | 8,9 | 0,1 | 0,0 | 0,2 | 0,2 | 0,0 | 9,2 | 9,2 | 9,1 | 0,1 | 0,0 |
| Other subsidies | — | — | Title II
  Administration | 1,2 | 1,2 | 1,0 | 0,2 | 0,0 | 0,7 | 0,7 | 0,0 | 1,9 | 1,9 | 1,7 | 0,2 | 0,0 |
| Other revenue | 0,3 | 0,1 | Title III
  Operating activities | 6,6 | 6,6 | 3,8 | 2,8 | 0,0 | 3,1 | 3,0 | 0,1 | 9,7 | 9,7 | 6,8 | 2,8 | 0,1 |
| Total | 16,8 | 17,2 | Total | 16,8 | 16,8 | 13,7 | 3,1 | 0,0 | 4,0 | 3,9 | 0,1 | 20,8 | 20,8 | 17,6 | 3,1 | 0,1 |
| Source:The Foundation's data. This table summarises the data provided by the Foundation in its accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Expenditure allocation

Appropriations in the final budget

Appropriations carried over from the previous financial year

Available appropriations

(appropriations for the current financial year and appropriations carried over from the previous financial year)

entered

committed

paid

carried over

cancelled

outstanding commitments

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies

16,5

17,1

Title I

Staff

9,0

9,0

8,9

0,1

0,0

0,2

0,2

0,0

9,2

9,2

9,1

0,1

0,0

Other subsidies

—

—

Title II

Administration

1,2

1,2

1,0

0,2

0,0

0,7

0,7

0,0

1,9

1,9

1,7

0,2

0,0

Other revenue

0,3

0,1

Title III

Operating activities

6,6

6,6

3,8

2,8

0,0

3,1

3,0

0,1

9,7

9,7

6,8

2,8

0,1

Total

16,8

17,2

Total

16,8

16,8

13,7

3,1

0,0

4,0

3,9

0,1

20,8

20,8

17,6

3,1

0,1

Source:The Foundation's data. This table summarises the data provided by the Foundation in its accounts.

Table 3

European Foundation for the Improvement of Living and Working Conditions — Revenue and expenditure accounts for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Commission subsidies | 17 090 | 16 500 |
| Miscellaneous revenue | 47 | 62 |
| Financial revenue | 35 | 57 |
| Total revenue (a) | 17 172 | 16 619 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 8 927 | 9 111 |
| Appropriations carried over | 109 | 216 |
| Administration — Title II of the budget |
| Payments | 968 | 938 |
| Appropriations carried over | 224 | 683 |
| Operating activities — Title III of the budget |
| Payments | 3 733 | 3 290 |
| Appropriations carried over | 2 817 | 3 105 |
| Total expenditure (b) | 16 778 | 17 343 |
| Outturn for the financial year (a – b) | 394 | – 724 |
| Balance carried over from the previous financial year | –1 836 | –1 209 |
| Appropriations carried over and cancelled | 118 | 81 |
| Sums from the previous financial year for re-use that were not used | 19 | 13 |
| PHARE revenue collected | 639 | 0 |
| PHARE revenue to be collected | 361 | 0 |
| PHARE expenditure | –1 000 | 0 |
| Exchange-rate differences | 9 | 3 |
| Balance for the financial year | –1 296 | –1 836 |
| Source:The Foundation's data. This table summarises the data provided by the Foundation in its own accounts. |

(1000 euro)

2003

2002

Revenue

Commission subsidies

17 090

16 500

Miscellaneous revenue

47

62

Financial revenue

35

57

Total revenue (a)

17 172

16 619

Expenditure

Staff — Title I of the budget

Payments

8 927

9 111

Appropriations carried over

109

216

Administration — Title II of the budget

Payments

968

938

Appropriations carried over

224

683

Operating activities — Title III of the budget

Payments

3 733

3 290

Appropriations carried over

2 817

3 105

Total expenditure (b)

16 778

17 343

Outturn for the financial year (a – b)

394

– 724

Balance carried over from the previous financial year

–1 836

–1 209

Appropriations carried over and cancelled

118

81

Sums from the previous financial year for re-use that were not used

19

13

PHARE revenue collected

639

0

PHARE revenue to be collected

361

0

PHARE expenditure

–1 000

0

Exchange-rate differences

9

3

Balance for the financial year

–1 296

–1 836

Source:The Foundation's data. This table summarises the data provided by the Foundation in its own accounts.

Table 4

European Foundation for the Improvement of Living and Working Conditions — Balance sheet as at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets
   (1) | | | Fixed capital | | |
| Intangible fixed assets | 27 | 31 | Own capital | 4 389 | 4 294 |
| Buildings (2) | 15 682 | 3 826 | Revaluation reserve | 12 094 | 0 |
| Furniture and vehicle transportation material | 142 | 139 | Balance for the financial year | –1 296 | –1 836 |
| Computer equipment | 107 | 149 | Subtotal | 15 187 | 2 458 |
| Technical and other equipment | 518 | 105 | Current liabilities | | |
| Fixed assets under construction | 0 | 31 | Automatic carry-overs of appropriations | 3 150 | 3 940 |
| Subtotal | 16 476 | 4 281 | Non-automatic carry-overs of appropriations | 0 | 64 |
| Stocks | | | Phare liabilities | 329 | 0 |
| Office supplies | 7 | 13 | Salary deductions | 0 | 139 |
| Subtotal | 7 | 13 | Subtotal | 3 479 | 4 143 |
| Current assets | | | Suspense accounts | | |
| Commission Phare receivables | 361 | 0 | Sums to be re-used | 22 | 150 |
| Advances | 2 | 11 | Deferred revenue | 2 | 1 840 |
| VAT to be recovered | 281 | 274 | Payments in progress | 0 | 30 |
| Recovery orders to be collected | 5 | 1 840 | Subtotal | 24 | 2 020 |
| Sundry accounts receivable | 41 | 13 | | | |
| Subtotal | 690 | 2 138 | | | |
| Cash accounts | | | | | |
| Banks | 1 331 | 1 960 | | | |
| Cash | 3 | 1 | | | |
| Imprest account | 183 | 228 | | | |
| Subtotal | 1 517 | 2 189 | | | |
| Total | 18 690 | 8 621 | Total | 18 690 | 8 621 |
| Source:The Foundation's data. This table summarises the data provided by the Foundation in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets
   (1)

Fixed capital

Intangible fixed assets

27

31

Own capital

4 389

4 294

Buildings (2)

15 682

3 826

Revaluation reserve

12 094

0

Furniture and vehicle transportation material

142

139

Balance for the financial year

–1 296

–1 836

Computer equipment

107

149

Subtotal

15 187

2 458

Technical and other equipment

518

105

Current liabilities

Fixed assets under construction

0

31

Automatic carry-overs of appropriations

3 150

3 940

Subtotal

16 476

4 281

Non-automatic carry-overs of appropriations

0

64

Stocks

Phare liabilities

329

0

Office supplies

7

13

Salary deductions

0

139

Subtotal

7

13

Subtotal

3 479

4 143

Current assets

Suspense accounts

Commission Phare receivables

361

0

Sums to be re-used

22

150

Advances

2

11

Deferred revenue

2

1 840

VAT to be recovered

281

274

Payments in progress

0

30

Recovery orders to be collected

5

1 840

Subtotal

24

2 020

Sundry accounts receivable

41

13

Subtotal

690

2 138

Cash accounts

Banks

1 331

1 960

Cash

3

1

Imprest account

183

228

Subtotal

1 517

2 189

Total

18 690

8 621

Total

18 690

8 621

Source:The Foundation's data. This table summarises the data provided by the Foundation in its own accounts.

---

(1)  The net value of the fixed assets is shown. The data for 2002 have been reprocessed for the purposes of comparison.

(2)  The Foundation has decided to revalue its fixed assets (12,1 million euro).

Source:The Foundation's data. This table summarises the data provided by the Foundation in its own accounts.

---

THE FOUNDATION'S REPLIES

| 7. | The Phare activity, not being explicitly covered by the Foundations establishing regulation, was not judged appropriate for integration it in its budget. The Foundation takes note of the observation of the Court and will include Phare financing in his future budgets. |
| --- | --- |

7.

The Phare activity, not being explicitly covered by the Foundations establishing regulation, was not judged appropriate for integration it in its budget. The Foundation takes note of the observation of the Court and will include Phare financing in his future budgets.

| 8. | The Foundation is in contact with the Commission's services to clarify the issue of the accumulated deficit and the treatment of future deficits or surpluses. |
| --- | --- |

8.

The Foundation is in contact with the Commission's services to clarify the issue of the accumulated deficit and the treatment of future deficits or surpluses.

| 9. | Provision for the internal control function was finalised with the introduction of a financial and operational verification function in November 2003. This function and other control work is carried out by a specialised unit. The function of internal audit is provided by the Commission’s Internal Audit Service. |
| --- | --- |

9.

Provision for the internal control function was finalised with the introduction of a financial and operational verification function in November 2003. This function and other control work is carried out by a specialised unit. The function of internal audit is provided by the Commission’s Internal Audit Service.

| 10. | The Accounting Officer relies on the validations performed by the Commission’s services, which have provided the accounting systems in use by the Foundation. |
| --- | --- |

10.

The Accounting Officer relies on the validations performed by the Commission’s services, which have provided the accounting systems in use by the Foundation.

| 12. | In developing its programmes the Foundation has achieved synergies with other agencies to the effect that each deals with complementary aspects within common thematic competences in order to avoid duplication of work. This has been formalised in joint declarations e.g. with the European Agency for Safety and Health at Work in Bilbao. |
| --- | --- |

12.

In developing its programmes the Foundation has achieved synergies with other agencies to the effect that each deals with complementary aspects within common thematic competences in order to avoid duplication of work. This has been formalised in joint declarations e.g. with the European Agency for Safety and Health at Work in Bilbao.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/83 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/83

---

REPORT

on the annual accounts of the European Monitoring Centre for Drugs and Drug Addiction for the 2003 financial year together with the Monitoring Centre's replies

(2004/C 324/12)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-11 | OBSERVATIONS |
| --- | --- |

6-11

Tables 1 to 4

The Monitoring Centre's replies

INTRODUCTION

| 1. | The European Monitoring Centre for Drugs and Drug Addiction (hereinafter called ‘the Monitoring Centre’) was established by Council Regulation (EEC) No 302/93 of 8 February 1993 (1). Its main objective is to collect data on drugs and drug addiction in order to prepare and publish information that is objective, reliable and comparable at European level. The information is intended to provide a basis for analysing demand for drugs and ways of reducing both it and drug-market-related events in general. Table 1 summarises the Monitoring Centre's competencies and activities on the basis of information received from it. |
| --- | --- |

1.

The European Monitoring Centre for Drugs and Drug Addiction (hereinafter called ‘the Monitoring Centre’) was established by Council Regulation (EEC) No 302/93 of 8 February 1993 (1). Its main objective is to collect data on drugs and drug addiction in order to prepare and publish information that is objective, reliable and comparable at European level. The information is intended to provide a basis for analysing demand for drugs and ways of reducing both it and drug-market-related events in general. Table 1 summarises the Monitoring Centre's competencies and activities on the basis of information received from it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the annual accounts of the Monitoring Centre for the financial year ended 31 December 2003. In accordance with Article 11 of Council Regulation (EEC) No 302/93, the budget was implemented on the responsibility of the Director. This responsibility included the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted under the same article. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to audit these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of the Monitoring Centre for the financial year ended 31 December 2003. In accordance with Article 11 of Council Regulation (EEC) No 302/93, the budget was implemented on the responsibility of the Director. This responsibility included the drawing-up and presentation of the accounts (3) in accordance with the internal financial provisions adopted under the same article. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to audit these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. The Court carried out such tests on the accounting records and applied such other procedures as it deemed necessary in the circumstances. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. The Court carried out such tests on the accounting records and applied such other procedures as it deemed necessary in the circumstances.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The observations which follow do not call into question the audit opinion expressed by the Court in this report. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The observations which follow do not call into question the audit opinion expressed by the Court in this report.

OBSERVATIONS

| 6. | The implementation of the appropriations for the 2003 financial year and of the appropriations carried over from the previous financial year is shown in Table 2. The Monitoring Centre's revenue and expenditure account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the 2003 financial year and of the appropriations carried over from the previous financial year is shown in Table 2. The Monitoring Centre's revenue and expenditure account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4.

| 7. | The duties of Authorising Officer for the greater part of the Monitoring Centre's budget (Titles I and II) and of the ex ante Controller for the entire budget are performed by just one person, who also carries out the duties of Head of Administration and of Quality Control. This combination of responsibilities significantly undermines internal control, which is based in particular on the principle of segregation of duties. |
| --- | --- |

7.

The duties of Authorising Officer for the greater part of the Monitoring Centre's budget (Titles I and II) and of the ex ante Controller for the entire budget are performed by just one person, who also carries out the duties of Head of Administration and of Quality Control. This combination of responsibilities significantly undermines internal control, which is based in particular on the principle of segregation of duties.

| 8. | Following the adoption of its new financial regulation (4), the Monitoring Centre issued in-house instructions for checking commitments, payments and recoveries. However, the files do not contain documents enabling the Authorising Officer to obtain assurance that all these instructions have actually been followed. |
| --- | --- |

8.

Following the adoption of its new financial regulation (4), the Monitoring Centre issued in-house instructions for checking commitments, payments and recoveries. However, the files do not contain documents enabling the Authorising Officer to obtain assurance that all these instructions have actually been followed.

| 9. | Article 42(1)(e) of the Monitoring Centre's financial regulation provides that the Accounting Officer should validate the systems laid down by the Authorising Officer and intended to provide or substantiate accounting information. This validation had still not been carried out at the end of the 2003 financial year. |
| --- | --- |

9.

Article 42(1)(e) of the Monitoring Centre's financial regulation provides that the Accounting Officer should validate the systems laid down by the Authorising Officer and intended to provide or substantiate accounting information. This validation had still not been carried out at the end of the 2003 financial year.

| 10. | Under its annual work programme, the Monitoring Centre concludes contracts with national centres. The deadline for the performance of these contracts is fixed at 31 December. The contracts for the 2003 programme (1,5 million euro in total) were not signed until July 2003. In May 2004, no final payments had yet been made in respect of the scheduled work and no additional clauses extending the length of the contracts had been signed. Moreover, the 2004 programme contracts had already been concluded. As regards renewal of these types of contract, due consideration should be given to the real progress achieved in the work requested the year before and to an evaluation of its quality. |
| --- | --- |

10.

Under its annual work programme, the Monitoring Centre concludes contracts with national centres. The deadline for the performance of these contracts is fixed at 31 December. The contracts for the 2003 programme (1,5 million euro in total) were not signed until July 2003. In May 2004, no final payments had yet been made in respect of the scheduled work and no additional clauses extending the length of the contracts had been signed. Moreover, the 2004 programme contracts had already been concluded. As regards renewal of these types of contract, due consideration should be given to the real progress achieved in the work requested the year before and to an evaluation of its quality.

| 11. | In its reply (5) to the Court's annual report concerning the 2002 financial year, the Monitoring Centre stated that a physical inventory would be carried out by the end of 2003. This had still not been done by the end of the first quarter of 2004. In addition, there is still no document that clearly defines the responsibilities and procedures regarding the inventory. |
| --- | --- |

11.

In its reply (5) to the Court's annual report concerning the 2002 financial year, the Monitoring Centre stated that a physical inventory would be carried out by the end of 2003. This had still not been done by the end of the first quarter of 2004. In addition, there is still no document that clearly defines the responsibilities and procedures regarding the inventory.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 36, 12.2.1993. Regulation amended by Regulation (EC) No 3294/94 of 22 December 1994 (OJ L 341, 30.12.1994, p. 7) and Regulation (EC) No 1651/2003 of 18 June 2003 (OJ L 245, 29.9.2003).

1

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

2

(3)  As required under Article 82 of Commission Regulation (EC) No 2343/2002, the Monitoring Centre's final accounts for the 2003 financial year were drawn up on 15 September 2004 and forwarded to the Court of Auditors. They were received by the Court on 21 September 2004. A summarised version of these accounts is presented in the tables annexed to this report.

3

(4)  Adopted by the Management Board at the meeting of 15 to 17 January 2003.

4

(5)  OJ C 319, 30.12.2003, p. 68, paragraph 11.

5

---

Table 1

European Monitoring Centre for Drugs and Drug Addiction (Lisbon)

| Areas of Community competence deriving from the Treaty | Competencies of the Monitoring Centre as defined in Council Regulation (EC) No 302/93 | Governance | Resources made available to the Monitoring Centre in 2003
  (2002 data) | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| The Community complements the Member States' action in reducing drugs-related health damage, including information and prevention.

  (Article 152 of the Treaty) | Objectives

  To provide the European Union and its Member States with reliable information at European level concerning drugs and drug addiction and their consequences.
  The Monitoring Centre should give priority to analysing the following:






  (1) | the demand and reduction of the demand for drugs |

Areas of Community competence deriving from the Treaty

Competencies of the Monitoring Centre as defined in Council Regulation (EC) No 302/93

Governance

Resources made available to the Monitoring Centre in 2003

(2002 data)

Products and services supplied in 2003

The Community complements the Member States' action in reducing drugs-related health damage, including information and prevention.

(Article 152 of the Treaty)

Objectives

To provide the European Union and its Member States with reliable information at European level concerning drugs and drug addiction and their consequences.

The Monitoring Centre should give priority to analysing the following:

(1)

the demand and reduction of the demand for drugs

| (2) | national and Community strategies and policies |
| --- | --- |

(2)

national and Community strategies and policies

| (3) | international cooperation and the geopolitics of supply |
| --- | --- |

(3)

international cooperation and the geopolitics of supply

| (4) | control of the trade in narcotics, psychotropic substances and drug precursors |
| --- | --- |

(4)

control of the trade in narcotics, psychotropic substances and drug precursors

| (5) | the implications of drug use for producer, consumer and transit countries, including money-laundering. |
| --- | --- |

(5)

the implications of drug use for producer, consumer and transit countries, including money-laundering.

Tasks

| (1) | To collect and analyse the data |
| --- | --- |

(1)

To collect and analyse the data

| (2) | To make enquiries and carry out preparatory actions |
| --- | --- |

(2)

To make enquiries and carry out preparatory actions

| (3) | To ensure that European-level data are more reliable |
| --- | --- |

(3)

To ensure that European-level data are more reliable

| (4) | To publish reliable information |
| --- | --- |

(4)

To publish reliable information

| (5) | To improve coordination between the national and Community actions |
| --- | --- |

(5)

To improve coordination between the national and Community actions

| (6) | To promote the incorporation of drug-related data into international programmes. |
| --- | --- |

(6)

To promote the incorporation of drug-related data into international programmes.

| 1. | The Management Board

  comprises one representative from each Member State, two representatives of the Commission and two qualified scientists appointed by the European Parliament. It approves the work programme and general annual report and adopts the budget. |
| --- | --- |

1.

The Management Board

comprises one representative from each Member State, two representatives of the Commission and two qualified scientists appointed by the European Parliament. It approves the work programme and general annual report and adopts the budget.

| 2. | Director: appointed by the Management Board on the Commission's proposal. |
| --- | --- |

2.

Director: appointed by the Management Board on the Commission's proposal.

| 3. | Scientific Committee: delivers opinions. It is made up of one representative from each Member State. The Management Board may also appoint a maximum of six other members on the basis of their specific qualifications. |
| --- | --- |

3.

Scientific Committee: delivers opinions. It is made up of one representative from each Member State. The Management Board may also appoint a maximum of six other members on the basis of their specific qualifications.

| 4. | External audit: Court of Auditors. |
| --- | --- |

4.

External audit: Court of Auditors.

| 5. | Discharge: European Parliament on the Council's recommendation. |
| --- | --- |

5.

Discharge: European Parliament on the Council's recommendation.

Budget:

10,45 million euro

(10,36 million euro)

Community subsidy: 89 % (87 %)

Staff numbers as at 31 December 2003:

Number of posts in establishment plan: 63 (59)

Posts occupied: 54 (57)

+18 (16) other staff (auxiliary contracts, seconded national experts, local staff, employment-agency staff)

Total staff: 72 (73)

assigned to the following duties:

operational: 46,5 (46)

administrative: 18 (19)

mixed: 7,5 (8)

Network

The Monitoring Centre runs a computerised network for the collection and exchange of information called the ‘European Information Network on Drugs and Drugs Addiction’ (Reitox); this network connects the national drug-information networks, the specialist centres in the Member States and the information systems of international organisations working with the Monitoring Centre.

Publications:

Annual report on the state of the drug problem in the European Union

General report of activities (annual)

Bi-monthly newsletter (Drugnet Europe)

Bi-monthly briefings (Drugs in focus).

Source:information supplied by the Monitoring Centre.

Table 2

European Monitoring Centre for Drugs and Drugs Addiction — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Expenditure allocation | Appropriations in the final budget | Appropriations carried over from the previous financial year | Available appropriations (2003 budget and financial year 2002) |
| entered | committed | paid | carried over | cancelled | outstanding commitments | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 9,3 | 9,3 | Title I
  Staff | 5,4 | 5,3 | 5,2 | 0,1 | 0,0 | 0,1 | 0,1 | 0,0 | 5,5 | 5,4 | 5,3 | 0,1 | 0,0 |
| Phare subsidies | 0,5 | 0,3 | Title II
  Administration | 0,9 | 0,9 | 0,6 | 0,3 | 0,1 | 0,5 | 0,5 | 0,0 | 1,4 | 1,4 | 1,0 | 0,3 | 0,1 |
| Other subsidies | 0,4 | 0,4 | Title III
  Operating expenditure | 4,0 | 4,0 | 2,3 | 1,7 | 0,0 | 1,0 | 0,8 | 0,2 | 5,0 | 5,0 | 3,1 | 1,7 | 0,2 |
| Other revenue | 0,0 | 0,1 |
| Total | 10,2 | 10,1 | Total | 10,2 | 10,2 | 8,1 | 2,0 | 0,1 | 1,6 | 1,4 | 0,2 | 11,8 | 11,8 | 9,5 | 2,0 | 0,3 |
| NB:The totals may contain differences due to rounding.

  Source:Data from the Monitoring Centre. These tables summarise the data provided by the Monitoring Centre in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Expenditure allocation

Appropriations in the final budget

Appropriations carried over from the previous financial year

Available appropriations (2003 budget and financial year 2002)

entered

committed

paid

carried over

cancelled

outstanding commitments

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies

9,3

9,3

Title I

Staff

5,4

5,3

5,2

0,1

0,0

0,1

0,1

0,0

5,5

5,4

5,3

0,1

0,0

Phare subsidies

0,5

0,3

Title II

Administration

0,9

0,9

0,6

0,3

0,1

0,5

0,5

0,0

1,4

1,4

1,0

0,3

0,1

Other subsidies

0,4

0,4

Title III

Operating expenditure

4,0

4,0

2,3

1,7

0,0

1,0

0,8

0,2

5,0

5,0

3,1

1,7

0,2

Other revenue

0,0

0,1

Total

10,2

10,1

Total

10,2

10,2

8,1

2,0

0,1

1,6

1,4

0,2

11,8

11,8

9,5

2,0

0,3

NB:The totals may contain differences due to rounding.

Source:Data from the Monitoring Centre. These tables summarise the data provided by the Monitoring Centre in its own accounts.

Table 3

European Monitoring Centre for Drugs and Drug Addiction — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Commission subsidies | 9 300 | 9 000 |
| Subsidies from Norway | 421 | 413 |
| Phare subsidies | 334 | 735 |
| Other revenue | 67 | 133 |
| Total revenue (a) | 10 122 | 10 280 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 5 240 | 4 951 |
| Appropriations carried over | 88 | 80 |
| Administration — Title II of the budget |
| Payments | 558 | 632 |
| Appropriations carried over | 272 | 509 |
| Operating expenditure — Title III of the budget |
| Payments | 2 281 | 2 525 |
| Appropriations carried over | 1 679 | 1 001 |
| Total expenditure (b) | 10 117 | 9 698 |
| Outturn for the financial year (a – b) | 5 | 582 |
| Balance carried over from the previous financial year | 1 626 | 639 |
| Appropriations carried over and cancelled | 221 | 392 |
| Sums for reuse from the previous financial year not used | 21 | 9 |
| Refunds to the Commission | –1 584 | — |
| Exchange-rate differences | 6 | 3 |
| Balance for the financial year | 295 | 1 626 |
| NB:The totals may include differences due to rounding.

  Source:Data from the Monitoring Centre. |

(1000 euro)

2003

2002

Revenue

Commission subsidies

9 300

9 000

Subsidies from Norway

421

413

Phare subsidies

334

735

Other revenue

67

133

Total revenue (a)

10 122

10 280

Expenditure

Staff — Title I of the budget

Payments

5 240

4 951

Appropriations carried over

88

80

Administration — Title II of the budget

Payments

558

632

Appropriations carried over

272

509

Operating expenditure — Title III of the budget

Payments

2 281

2 525

Appropriations carried over

1 679

1 001

Total expenditure (b)

10 117

9 698

Outturn for the financial year (a – b)

5

582

Balance carried over from the previous financial year

1 626

639

Appropriations carried over and cancelled

221

392

Sums for reuse from the previous financial year not used

21

9

Refunds to the Commission

–1 584

—

Exchange-rate differences

6

3

Balance for the financial year

295

1 626

NB:The totals may include differences due to rounding.

Source:Data from the Monitoring Centre.

Table 4

European Monitoring Centre for Drugs and Drug Addiction — Balance sheet at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets | | | Fixed capital | | |
| Intangible fixed assets | 94 | 66 | Own capital | 3 057 | 2 797 |
| Buildings | 3 559 | 3 559 | Balance for the financial year | 295 | 1 626 |
| Equipment and furniture | 157 | 152 | | | |
| Computer equipment | 659 | 785 | | | |
| Vehicles | 50 | 74 | | | |
| Depreciation | –1 496 | –1 867 | Subtotal | 3 352 | 4 423 |
| | | | Current liabilities | | |
| Subtotal | 3 023 | 2 768 | Automatic carry-overs | 1 815 | 1 377 |
| Stocks | 34 | 28 | Non-automatic carry-overs | — | 212 |
| | | | Phare carry-overs | 223 | — |
| Current assets | | | Sundry accounts payable | 18 | 18 |
| Recoverable VAT | 94 | 84 | Recovery orders (1) | 55 | 101 |
| Sundry accounts receivable | 66 | 18 | | | |
| Advances | 78 | — | | | |
| Subtotal | 238 | 101 | Subtotal | 2 111 | 1 709 |
| Cash accounts | | | Suspense accounts | | |
| Bank accounts | 2 291 | 3 474 | Sums to be reused | — | 265 |
| Imprest account | 0 | 4 | Deferred revenue | 123 | 4 |
| | | | Subtotal | 123 | 269 |
| Subtotal | 2 291 | 3 478 | | | |
| Suspense accounts | 0 | 24 | | | |
| Total | 5 586 | 6 400 | Total | 5 586 | 6 400 |
| NB:The totals may include differences due to rounding.

  Source:Data from the Monitoring Centre. These tables summarise the data provided by the Monitoring Centre in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets

Fixed capital

Intangible fixed assets

94

66

Own capital

3 057

2 797

Buildings

3 559

3 559

Balance for the financial year

295

1 626

Equipment and furniture

157

152

Computer equipment

659

785

Vehicles

50

74

Depreciation

–1 496

–1 867

Subtotal

3 352

4 423

Current liabilities

Subtotal

3 023

2 768

Automatic carry-overs

1 815

1 377

Stocks

34

28

Non-automatic carry-overs

—

212

Phare carry-overs

223

—

Current assets

Sundry accounts payable

18

18

Recoverable VAT

94

84

Recovery orders (1)

55

101

Sundry accounts receivable

66

18

Advances

78

—

Subtotal

238

101

Subtotal

2 111

1 709

Cash accounts

Suspense accounts

Bank accounts

2 291

3 474

Sums to be reused

—

265

Imprest account

0

4

Deferred revenue

123

4

Subtotal

123

269

Subtotal

2 291

3 478

Suspense accounts

0

24

Total

5 586

6 400

Total

5 586

6 400

NB:The totals may include differences due to rounding.

Source:Data from the Monitoring Centre. These tables summarise the data provided by the Monitoring Centre in its own accounts.

---

(1)  Recovery orders issued, but not yet collected, that have not yet resulted in the entering of appropriations for reuse.

NB:The totals may include differences due to rounding.

Source:Data from the Monitoring Centre. These tables summarise the data provided by the Monitoring Centre in its own accounts.

---

THE MONITORING CENTRE'S REPLIES

| 7. | The combination of responsibilities mentioned by the Court was one of the consequences of the departure of the Head of the Financial Sector. The Head of administration was obliged to take on this role for a transitional period until the new Head of the Financial Sector took up his duties on 1 February 2004. This person, who has become the ex ante verifying officer, does not perform the duties of Authorising Officer. |
| --- | --- |

7.

The combination of responsibilities mentioned by the Court was one of the consequences of the departure of the Head of the Financial Sector. The Head of administration was obliged to take on this role for a transitional period until the new Head of the Financial Sector took up his duties on 1 February 2004. This person, who has become the ex ante verifying officer, does not perform the duties of Authorising Officer.

| 8. | In accordance with the financial provisions applicable, the instructions in question set out the various procedures of budgetary implementation, the persons in charge of these procedures, and their tasks and responsibilities, including in terms of checking. The procedural stages were described in a circulation sheet, for approval by the persons responsible for their execution, who, in addition, in most cases, have to give, their electronic visa before the file is being sent to the authorizing officer. The EMCDDA has taken note of the Court’s comment, and in order to take better account of the checks made, has prepared checklists to be added to files relating to budgetary operations. |
| --- | --- |

8.

In accordance with the financial provisions applicable, the instructions in question set out the various procedures of budgetary implementation, the persons in charge of these procedures, and their tasks and responsibilities, including in terms of checking. The procedural stages were described in a circulation sheet, for approval by the persons responsible for their execution, who, in addition, in most cases, have to give, their electronic visa before the file is being sent to the authorizing officer. The EMCDDA has taken note of the Court’s comment, and in order to take better account of the checks made, has prepared checklists to be added to files relating to budgetary operations.

| 9. | The validation was carried out and submitted to the Court on 27 July 2004. |
| --- | --- |

9.

The validation was carried out and submitted to the Court on 27 July 2004.

| 10. | The budget for 2003 allocated to the activities of the national focal points of the REITOX network was the subject of a parliamentary reservation until the end of April. Therefore, it was not possible to sign the subsidies until very late in the year. Furthermore, the EMCDDA decided not to make advance payments for 2004 until it had examined and closed the cost statements of the 2003. When renewing contracts in the future, the EMCDDA will naturally give due consideration to the real progress achieved in the work requested the year before and to an evaluation of its quality. |
| --- | --- |

10.

The budget for 2003 allocated to the activities of the national focal points of the REITOX network was the subject of a parliamentary reservation until the end of April. Therefore, it was not possible to sign the subsidies until very late in the year. Furthermore, the EMCDDA decided not to make advance payments for 2004 until it had examined and closed the cost statements of the 2003. When renewing contracts in the future, the EMCDDA will naturally give due consideration to the real progress achieved in the work requested the year before and to an evaluation of its quality.

| 11. | Great efforts were taken in May 2004 to identify all EMCDDA assets and to finalise the physical inventory. This exercise and the redefinition of responsibilities and procedures will be completed before the end of 2004. |
| --- | --- |

11.

Great efforts were taken in May 2004 to identify all EMCDDA assets and to finalise the physical inventory. This exercise and the redefinition of responsibilities and procedures will be completed before the end of 2004.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/91 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/91

---

REPORT

on the annual accounts of the European Monitoring Centre on Racism and Xenophobia for the 2003 financial year together with the Monitoring Centre's replies

(2004/C 324/13)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-14 | OBSERVATIONS |
| --- | --- |

6-14

Tables 1 to 4

The Monitoring Centre's replies

INTRODUCTION

| 1. | The European Monitoring Centre on Racism and Xenophobia (‘the Centre’) was established by Council Regulation (EC) No 1035/97 of 2 June 1997 (1). The Centre’s primary tasks are to provide the Union and the Member States with reliable information on racism, xenophobia and anti-semitism in the Union and to cooperate with the Council of Europe in these areas. Table 1 is based on information forwarded by the Centre and gives a brief overview of its responsibilities and activities. |
| --- | --- |

1.

The European Monitoring Centre on Racism and Xenophobia (‘the Centre’) was established by Council Regulation (EC) No 1035/97 of 2 June 1997 (1). The Centre’s primary tasks are to provide the Union and the Member States with reliable information on racism, xenophobia and anti-semitism in the Union and to cooperate with the Council of Europe in these areas. Table 1 is based on information forwarded by the Centre and gives a brief overview of its responsibilities and activities.

THE COURT’S OPINION

| 2. | This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2). |
| --- | --- |

2.

This opinion is addressed to the European Parliament and the Council, in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2).

| 3. | The Court has examined the annual accounts of the Centre for the financial year ended 31 December 2003. In accordance with Article 12(8) of Council Regulation (EC) No 1035/97, the budget was implemented on the Director’s responsibility. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions adopted under Article 12(12) of Council Regulation (EC) No 1035/97. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the annual accounts of the Centre for the financial year ended 31 December 2003. In accordance with Article 12(8) of Council Regulation (EC) No 1035/97, the budget was implemented on the Director’s responsibility. This responsibility includes the drawing-up and presentation of the accounts (3), in accordance with the internal financial provisions adopted under Article 12(12) of Council Regulation (EC) No 1035/97. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court performed its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context. |
| --- | --- |

4.

The Court performed its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context.

| 5. | The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable. Subject to the matter described in paragraph 13, the Court obtained reasonable assurance that the underlying transactions, taken as a whole, are legal and regular. |
| --- | --- |

5.

The Court thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable. Subject to the matter described in paragraph 13, the Court obtained reasonable assurance that the underlying transactions, taken as a whole, are legal and regular.

OBSERVATIONS

| 6. | The implementation of the appropriations of the financial year 2003 and the appropriations carried over from the previous financial year is shown in Table 2
   (4). The Centre’s balance sheet and revenue and expenditure account for the financial year 2003 are summarised in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations of the financial year 2003 and the appropriations carried over from the previous financial year is shown in Table 2
   (4). The Centre’s balance sheet and revenue and expenditure account for the financial year 2003 are summarised in Tables 3 and 4.

| 7. | The level of carry-overs of appropriations under Title III, Operating activities, remained high, but was lower than the previous year (36 % in 2003 and 40 % in 2002). The Court once again (5) draws the Centre’s attention to the necessity of observing the principle of annuality more fully when planning and monitoring its activities. |
| --- | --- |

7.

The level of carry-overs of appropriations under Title III, Operating activities, remained high, but was lower than the previous year (36 % in 2003 and 40 % in 2002). The Court once again (5) draws the Centre’s attention to the necessity of observing the principle of annuality more fully when planning and monitoring its activities.

| 8. | Of the appropriations carried over from the financial year 2002 to the financial year 2003 (1,5 million euro), 20 % were cancelled at the year-end. This is a large percentage, showing that the justification for the automatic carry-overs of 2002 appropriations was poor, especially in the case of provisional commitments. Carry-overs of appropriations must be strictly limited to obligations duly contracted at the close of the financial year. |
| --- | --- |

8.

Of the appropriations carried over from the financial year 2002 to the financial year 2003 (1,5 million euro), 20 % were cancelled at the year-end. This is a large percentage, showing that the justification for the automatic carry-overs of 2002 appropriations was poor, especially in the case of provisional commitments. Carry-overs of appropriations must be strictly limited to obligations duly contracted at the close of the financial year.

| 9. | On 3 March 2003 the Centre signed a convention with the Commission concerning the establishment of an information network for the candidate countries in central and eastern Europe. The project receives funding via Phare subsidies totalling 845 000 euro. In accordance with Article 4 of the convention the Centre received an advance of 676 000 euro (80 %) in 2003. Contrary to the principles of budget unity (6), the Centre did not use an amending budget to include the amount of the 2003 Phare subsidy in its budget. |
| --- | --- |

9.

On 3 March 2003 the Centre signed a convention with the Commission concerning the establishment of an information network for the candidate countries in central and eastern Europe. The project receives funding via Phare subsidies totalling 845 000 euro. In accordance with Article 4 of the convention the Centre received an advance of 676 000 euro (80 %) in 2003. Contrary to the principles of budget unity (6), the Centre did not use an amending budget to include the amount of the 2003 Phare subsidy in its budget.

| 10. | As the Court has already pointed out, in its 2002 Report (7), the Centre should establish an efficient system for managing and monitoring revenue to be collected. A system of that type would avoid the delays that were observed in the issue of recovery orders and the recovery of VAT. |
| --- | --- |

10.

As the Court has already pointed out, in its 2002 Report (7), the Centre should establish an efficient system for managing and monitoring revenue to be collected. A system of that type would avoid the delays that were observed in the issue of recovery orders and the recovery of VAT.

| 11. | As of 31 December 2003 the recovery orders relating to the Austrian authorities’ reimbursement of rent for the period May to August 2003 (37 017 euro) had not been drawn up. |
| --- | --- |

11.

As of 31 December 2003 the recovery orders relating to the Austrian authorities’ reimbursement of rent for the period May to August 2003 (37 017 euro) had not been drawn up.

| 12. | An amount of 333 474 euro of VAT paid in 2000 has still not been recovered. If exchange-rate differences are taken into account, the total is understated by 19 242 euro. The Centre must step up its efforts to obtain the VAT reimbursement. Furthermore, the VAT accounts are not regularly analysed and justified. As an example, one VAT reimbursement of around 78 000 euro had not been included as budget revenue and remained as an entry in a suspense account. |
| --- | --- |

12.

An amount of 333 474 euro of VAT paid in 2000 has still not been recovered. If exchange-rate differences are taken into account, the total is understated by 19 242 euro. The Centre must step up its efforts to obtain the VAT reimbursement. Furthermore, the VAT accounts are not regularly analysed and justified. As an example, one VAT reimbursement of around 78 000 euro had not been included as budget revenue and remained as an entry in a suspense account.

| 13. | In 2003 the Centre placed three contracts (for a total of 181 078 euro) with the same supplier, through the negotiated procedure, even though each of the contracts exceeded the 13 800 euro ceiling that applies to that procedure and the conditions that allow the limit to be exceeded were inapplicable. |
| --- | --- |

13.

In 2003 the Centre placed three contracts (for a total of 181 078 euro) with the same supplier, through the negotiated procedure, even though each of the contracts exceeded the 13 800 euro ceiling that applies to that procedure and the conditions that allow the limit to be exceeded were inapplicable.

| 14. | The Centre invited applications from internal candidates for two recruitments. In one case there was only one applicant, and in the other only two. In view of the Centre’s size, this type of procedure limits competition between candidates. |
| --- | --- |

14.

The Centre invited applications from internal candidates for two recruitments. In one case there was only one applicant, and in the other only two. In view of the Centre’s size, this type of procedure limits competition between candidates.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 151, 10.6.1997, p. 6.

1

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

2

(3)  As required by Article 12(10) of Council Regulation (EC) No 1035/97 the accounts for all the Centre’s revenue and expenditure for the financial year 2003 were drawn up on 9 September 2004 and forwarded to the Court of Auditors, which received them on 24 September 2004. A summarised version of those accounts is presented in the tables annexed to this report.

3

(4)  All the tables in the Report were drawn up on the basis of the most exact values possible for the data used. Figures have been rounded, for presentational purposes, which may produce minor differences in totals. A dash indicates a non-existent or zero value and 0,0 indicates a value below the rounding threshold.

4

(5)  See paragraph 7 of the 2002 report (OJ C 319, 30.12.2003, p. 70).

5

(6)  See Articles 4 to 6 on the principle of unity and budget accuracy and Article 19(3) of the Centre’s financial regulation.

6

(7)  See paragraph 9 of the Report concerning the 2002 financial year (OJ C 319, 30.12.2003, p. 70).

7

---

Table 1

European Monitoring Centre on Racism and Xenophobia (Vienna)

| Areas of Community competence deriving from the Treaty | Competence of the Centre as defined in the Council Regulation
  (Council Regulation (EC) No 1035/97 of 2 June 1997) | Governance | Resources available to the Centre in 2003 (2002 figures) | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| Collection of information







  — | The Commission may, within the limits and under conditions laid down by the Council in accordance with the provisions of this Treaty, collect any information and carry out any checks required for the performance of the tasks entrusted to it. |

Areas of Community competence deriving from the Treaty

Competence of the Centre as defined in the Council Regulation

(Council Regulation (EC) No 1035/97 of 2 June 1997)

Governance

Resources available to the Centre in 2003 (2002 figures)

Products and services supplied in 2003

Collection of information

—

The Commission may, within the limits and under conditions laid down by the Council in accordance with the provisions of this Treaty, collect any information and carry out any checks required for the performance of the tasks entrusted to it.

(Article 284)

Objectives

| — | To provide the Community and its Member States with objective, reliable and comparable data at European level on the phenomena of racism, xenophobia and anti-Semitism |
| --- | --- |

—

To provide the Community and its Member States with objective, reliable and comparable data at European level on the phenomena of racism, xenophobia and anti-Semitism

| — | Close cooperation with the Council of Europe in order to avoid duplication and obtain added value |
| --- | --- |

—

Close cooperation with the Council of Europe in order to avoid duplication and obtain added value

Tasks

| — | To study the extent and development of the phenomena of racism and xenophobia |
| --- | --- |

—

To study the extent and development of the phenomena of racism and xenophobia

| — | To collect and analyse information, via the European Racism and Xenophobia Information Network (RAXEN) in particular |
| --- | --- |

—

To collect and analyse information, via the European Racism and Xenophobia Information Network (RAXEN) in particular

| — | To carry out scientific surveys |
| --- | --- |

—

To carry out scientific surveys

| — | To encourage widespread dissemination of such information |
| --- | --- |

—

To encourage widespread dissemination of such information

| — | To formulate opinions for the Community and its Member States |
| --- | --- |

—

To formulate opinions for the Community and its Member States

| — | To develop indicators and criteria to improve the comparability of data |
| --- | --- |

—

To develop indicators and criteria to improve the comparability of data

| — | To publish an annual report on the situation regarding racism and xenophobia. |
| --- | --- |

—

To publish an annual report on the situation regarding racism and xenophobia.

| 1. | Management Board

  Composition
  One independent person appointed by each Member State, one independent person appointed by the European Parliament, one independent person appointed by the Council of Europe and a representative of the Commission.
  Duties
  To adopt the work programme and the general annual report. |
| --- | --- |

1.

Management Board

One independent person appointed by each Member State, one independent person appointed by the European Parliament, one independent person appointed by the Council of Europe and a representative of the Commission.

To adopt the work programme and the general annual report.

| 2. | Executive Board

  Composition






  — | Chairman of the Management Board |
| --- | --- | --- |

2.

Executive Board

—

Chairman of the Management Board

| — | representative of the Council of Europe |
| --- | --- |

—

representative of the Council of Europe

| — | representative of the Commission |
| --- | --- |

—

representative of the Commission

| — | one other member of the Management Board (optional) |
| --- | --- |

—

one other member of the Management Board (optional)

| 3. | Director

  Appointed by the Management Board on a proposal from the Commission. |
| --- | --- |

3.

Director

Appointed by the Management Board on a proposal from the Commission.

| 4. | External audit

  Court of Auditors |
| --- | --- |

4.

External audit

Court of Auditors

| 5. | Discharge authority

  Parliament on a recommendation from the Council |
| --- | --- |

5.

Discharge authority

Parliament on a recommendation from the Council

Final budget:

6,575 million euro (6,170 million euro) including Community contribution 98,9 % (98,9 %):

Staff numbers at 31 December 2003:

30 (28) posts in establishment plan, posts occupied: 26 (26)

+4 (5) other staff (auxiliary contracts, seconded national experts, local and agency staff)

Total staff: 30 (31)

Assigned to the following duties:

operational: 17 (19)

administrative: 8 (8)

mixed: 5 (4)

Non-budgetary:

Phare programme: 845 million euro (– million euro), staff: 4 (–)

RAXEN:

number of contributions through 15 national focal points: 165

number of meetings: 3

+22 reports in the PHARE programme framework and 3 meetings

RESEARCH REPORTS:

number of reports: 12

number of meetings: 3

Cooperation With The Member States And The Other Institutions (number of events organised jointly):

| — | Member States: 19 |
| --- | --- |

—

Member States: 19

| — | Commission: 2 |
| --- | --- |

—

Commission: 2

| — | European Parliament: 2 |
| --- | --- |

—

European Parliament: 2

| — | Council of Europe: 4 |
| --- | --- |

—

Council of Europe: 4

Source:Information supplied by the Centre.

Table 2

European Monitoring Centre on Racism and Xenophobia — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Source of revenue | Revenue entered in the final budget for the financial year | Revenue received | Allocation of expenditure | Final budget appropriations | Appropriations carried over from the previous financial year | Available appropriations
  (2003 budget and financial year 2002) |
| entered | committed | paid | carried over | cancelled | commitments outstanding | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Community subsidies | 6,5 | 5,6 | Title I
  Staff | 2,8 | 2,7 | 2,6 | 0,1 | 0,1 | 0,2 | 0,1 | 0,1 | 3,0 | 2,9 | 2,7 | 0,1 | 0,2 |
| Other revenue | 0,1 | 0,2 | Title II
  Administration | 0,6 | 0,5 | 0,4 | 0,1 | 0,1 | 0,1 | 0,0 | 0,0 | 0,6 | 0,6 | 0,4 | 0,1 | 0,1 |
| | | | Title III
  Operating activities | 3,2 | 2,8 | 1,7 | 1,2 | 0,4 | 1,2 | 1,0 | 0,2 | 4,4 | 4,0 | 2,7 | 1,2 | 0,5 |
| Total | 6,6 | 5,8 | Total | 6,6 | 6,0 | 4,7 | 1,3 | 0,6 | 1,5 | 1,2 | 0,3 | 8,1 | 7,5 | 5,9 | 1,3 | 0,9 |
| NB:Totals may include differences due to rounding.

  Source:Data supplied by the Centre. These tables summarise the data supplied by the Centre in its own accounts. |

(million euro)

Revenue

Expenditure

Source of revenue

Revenue entered in the final budget for the financial year

Revenue received

Allocation of expenditure

Final budget appropriations

Appropriations carried over from the previous financial year

Available appropriations

(2003 budget and financial year 2002)

entered

committed

paid

carried over

cancelled

commitments outstanding

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Community subsidies

6,5

5,6

Title I

Staff

2,8

2,7

2,6

0,1

0,1

0,2

0,1

0,1

3,0

2,9

2,7

0,1

0,2

Other revenue

0,1

0,2

Title II

Administration

0,6

0,5

0,4

0,1

0,1

0,1

0,0

0,0

0,6

0,6

0,4

0,1

0,1

Title III

Operating activities

3,2

2,8

1,7

1,2

0,4

1,2

1,0

0,2

4,4

4,0

2,7

1,2

0,5

Total

6,6

5,8

Total

6,6

6,0

4,7

1,3

0,6

1,5

1,2

0,3

8,1

7,5

5,9

1,3

0,9

NB:Totals may include differences due to rounding.

Source:Data supplied by the Centre. These tables summarise the data supplied by the Centre in its own accounts.

Table 3

European Monitoring Centre on Racism and Xenophobia — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Community subsidies | 7 318 | 4 320 |
| Other revenue | 374 | |
| Financial revenue | 21 | 43 |
| PHARE revenue | 676 | |
| Total revenue (a) | 8 389 | 4 363 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 2 618 | 2 416 |
| Appropriations carried over | 64 | 187 |
| Administration — Title II of the budget |
| Payments | 412 | 377 |
| Appropriations carried over | 51 | 60 |
| Operating activities — Title III of the budget |
| Payments | 1 678 | 1 686 |
| Appropriations carried over | 1 162 | 1 234 |
| PHARE expenditure |
| Payments | 377 | |
| Appropriations carried over | 694 | |
| Total expenditure (b) | 7 055 | 5 960 |
| Outturn for the financial year (a – b) | 1 334 | –1 597 |
| Balance carried over from the previous financial year | –1 579 | –8 |
| Appropriations carried over, cancelled | 301 | 52 |
| Appropriations for re-use from the previous financial year, not used | 38 | 151 |
| Exchange-rate differences | 5 | 2 |
| Amounts refunded to the Commission | | – 179 |
| Balance for the financial year | 98 | –1 579 |
| NB:Totals may include differences due to rounding.

  Source:Data supplied by the Centre. These tables summarise the data supplied by the Centre in its own accounts. |

(1000 euro)

2003

2002

Revenue

Community subsidies

7 318

4 320

Other revenue

374

Financial revenue

21

43

PHARE revenue

676

Total revenue (a)

8 389

4 363

Expenditure

Staff — Title I of the budget

Payments

2 618

2 416

Appropriations carried over

64

187

Administration — Title II of the budget

Payments

412

377

Appropriations carried over

51

60

Operating activities — Title III of the budget

Payments

1 678

1 686

Appropriations carried over

1 162

1 234

PHARE expenditure

Payments

377

Appropriations carried over

694

Total expenditure (b)

7 055

5 960

Outturn for the financial year (a – b)

1 334

–1 597

Balance carried over from the previous financial year

–1 579

–8

Appropriations carried over, cancelled

301

52

Appropriations for re-use from the previous financial year, not used

38

151

Exchange-rate differences

5

2

Amounts refunded to the Commission

– 179

Balance for the financial year

98

–1 579

NB:Totals may include differences due to rounding.

Source:Data supplied by the Centre. These tables summarise the data supplied by the Centre in its own accounts.

Table 4

European Monitoring Centre on Racism and Xenophobia — Balance sheet at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| ASSETS | 2003 | 2002 | LIABILITIES | 2003 | 2002 |
| Fixed assets | | | Own capital | | |
| Computer software | 72 | 70 | Own capital | 108 | 183 |
| Computer equipment | 148 | 140 | Balance for the financial year | 98 | –1 579 |
| Equipment and furniture | 250 | 235 | Subtotal | 207 | –1 396 |
| Depreciation | – 362 | – 262 | Current liabilities | | |
| Subtotal | 108 | 183 | Automatic carry-overs | 1 277 | 1 482 |
| Current assets | | | Sundry accounts payable | 275 | 225 |
| Community subsidies | 23 | 13 | VAT to be paid | 454 | 507 |
| Advances | 0 | 1 | PHARE liabilities | 694 | |
| Sundry accounts receivable | 77 | 66 | Subtotal | 2 700 | 2 214 |
| Recoverable VAT | 456 | 541 | | | |
| PHARE subsidy | 169 | 0 | | | |
| Subtotal | 725 | 621 | | | |
| Cash accounts | | | Suspense accounts and adjustment accounts | | |
| Bank accounts | 2 073 | 113 | Sums to be reused | | 99 |
| Subtotal | 2 073 | 113 | Subtotal | 0 | 99 |
| Total | 2 906 | 917 | Total | 2 906 | 917 |
| NB:Totals may include differences due to rounding.

  Source:Data supplied by the Centre. The tables summarise the data supplied by the Centre in its own accounts. |

(1000 euro)

ASSETS

2003

2002

LIABILITIES

2003

2002

Fixed assets

Own capital

Computer software

72

70

Own capital

108

183

Computer equipment

148

140

Balance for the financial year

98

–1 579

Equipment and furniture

250

235

Subtotal

207

–1 396

Depreciation

– 362

– 262

Current liabilities

Subtotal

108

183

Automatic carry-overs

1 277

1 482

Current assets

Sundry accounts payable

275

225

Community subsidies

23

13

VAT to be paid

454

507

Advances

0

1

PHARE liabilities

694

Sundry accounts receivable

77

66

Subtotal

2 700

2 214

Recoverable VAT

456

541

PHARE subsidy

169

0

Subtotal

725

621

Cash accounts

Suspense accounts and adjustment accounts

Bank accounts

2 073

113

Sums to be reused

99

Subtotal

2 073

113

Subtotal

0

99

Total

2 906

917

Total

2 906

917

NB:Totals may include differences due to rounding.

Source:Data supplied by the Centre. The tables summarise the data supplied by the Centre in its own accounts.

---

THE MONITORING CENTRE'S REPLIES

| 7. | In 2003 the execution of the budget and the implementation of the Work Programme were again affected adversely by the low level of payment appropriations available to the EUMC. In July 2003 the EUMC requested additional payment appropriations that were ultimately received only in December 2003. The EUMC would also like to emphasise the fact that in some Member States the official data that is used by the RAXEN network is not published until September. Despite all of the above, the level of carry-overs has decreased in comparison to 2002, as indicated by the Court. The EUMC will continue its efforts to further improve the situation. |
| --- | --- |

7.

In 2003 the execution of the budget and the implementation of the Work Programme were again affected adversely by the low level of payment appropriations available to the EUMC. In July 2003 the EUMC requested additional payment appropriations that were ultimately received only in December 2003. The EUMC would also like to emphasise the fact that in some Member States the official data that is used by the RAXEN network is not published until September. Despite all of the above, the level of carry-overs has decreased in comparison to 2002, as indicated by the Court. The EUMC will continue its efforts to further improve the situation.

| 8. | The EUMC agrees with the observation made by the Court and has taken appropriate measures in 2003 to prevent this occurring in the future. |
| --- | --- |

8.

The EUMC agrees with the observation made by the Court and has taken appropriate measures in 2003 to prevent this occurring in the future.

| 9. | The EUMC decided not to publish its PHARE budget in an amending budget because the project dealt with non-Member States, therefore it was not within the scope of the EUMC’s mandate as defined in its basic regulation. However, given the Court’s observation, the EUMC has included the PHARE project budget in its amending budget 2004. |
| --- | --- |

9.

The EUMC decided not to publish its PHARE budget in an amending budget because the project dealt with non-Member States, therefore it was not within the scope of the EUMC’s mandate as defined in its basic regulation. However, given the Court’s observation, the EUMC has included the PHARE project budget in its amending budget 2004.

| 10 and 11. | The EUMC agrees with the observation made by the Court and has taken measures to improve the controls over the creation of recovery orders. |
| --- | --- |

10 and 11.

The EUMC agrees with the observation made by the Court and has taken measures to improve the controls over the creation of recovery orders.

| 12. | The EUMC re-calculated and re-submitted its claim for the reimbursement of the amount of EUR 333 474 in VAT outstanding, which the Austrian authorities settled in June 2004. Regarding the EUR 78 000, the EUMC has amended its accounts accordingly. The VAT is now analyzed on a regular basis. |
| --- | --- |

12.

The EUMC re-calculated and re-submitted its claim for the reimbursement of the amount of EUR 333 474 in VAT outstanding, which the Austrian authorities settled in June 2004. Regarding the EUR 78 000, the EUMC has amended its accounts accordingly. The VAT is now analyzed on a regular basis.

| 13. | The EUMC agrees with the Court’s observations and has, as a result, re-enforced internal controls with the introduction of a procurement helpdesk and additional training. The EUMC would like to point out that an open call for tender had been planned for 2003 but could not be implemented due to a lack of human resources (see reply to point 14). The EUMC made an open call for tender in 2004 for a framework contract for the organisation of meetings. The company that won this tender is the same company that was used throughout 2003. The fact that this company was selected following the correct procurement procedure in the years prior to 2003, in the opinion of the EUMC, suggests that there were no material adverse financial consequences. |
| --- | --- |

13.

The EUMC agrees with the Court’s observations and has, as a result, re-enforced internal controls with the introduction of a procurement helpdesk and additional training. The EUMC would like to point out that an open call for tender had been planned for 2003 but could not be implemented due to a lack of human resources (see reply to point 14). The EUMC made an open call for tender in 2004 for a framework contract for the organisation of meetings. The company that won this tender is the same company that was used throughout 2003. The fact that this company was selected following the correct procurement procedure in the years prior to 2003, in the opinion of the EUMC, suggests that there were no material adverse financial consequences.

| 14. | Internal competitions are not an infringement of the staff regulations. Given the small size of the EUMC and the absence of permanent posts, a decision was made to fill the vacant temporary posts via internal competition so as to provide staff with a certain career perspective and to fill two key positions as rapidly as possible. The EUMC has, however, decided that in the future internal competitions will only be made if a certain level of competition is guaranteed. |
| --- | --- |

14.

Internal competitions are not an infringement of the staff regulations. Given the small size of the EUMC and the absence of permanent posts, a decision was made to fill the vacant temporary posts via internal competition so as to provide staff with a certain career perspective and to fill two key positions as rapidly as possible. The EUMC has, however, decided that in the future internal competitions will only be made if a certain level of competition is guaranteed.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/99 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/99

---

REPORT

on the annual accounts of the Community Plant Variety Office for the 2003 financial year together with the Office's replies

(2004/C 324/14)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-10 | OBSERVATIONS |
| --- | --- |

6-10

Tables 1 to 4

The Office's replies

INTRODUCTION

| 1. | The Community Plant Variety Office (hereinafter referred to as the Office) was created by Council Regulation (EC) No 2100/94 of 27 July 1994 (1). Its main purpose is to register and examine applications for the grant of Community industrial property rights for plant varieties and to ensure that the necessary technical examinations are carried out by the competent offices in the Member States. Table 1 summarises the powers and responsibilities of the Office on the basis of the information supplied by it. |
| --- | --- |

1.

The Community Plant Variety Office (hereinafter referred to as the Office) was created by Council Regulation (EC) No 2100/94 of 27 July 1994 (1). Its main purpose is to register and examine applications for the grant of Community industrial property rights for plant varieties and to ensure that the necessary technical examinations are carried out by the competent offices in the Member States. Table 1 summarises the powers and responsibilities of the Office on the basis of the information supplied by it.

THE COURT'S OPINION

| 2. | This opinion is addressed to the Administrative Council of the Office, pursuant to Article 111(2) of Council Regulation (EC) No 2100/94. |
| --- | --- |

2.

This opinion is addressed to the Administrative Council of the Office, pursuant to Article 111(2) of Council Regulation (EC) No 2100/94.

| 3. | The Court has examined the Office's annual accounts for the financial year ended 31 December 2003. In accordance with Article 110 of Council Regulation (EC) No 2100/94, the Office's budget was implemented on the responsibility of its President. This responsibility includes the drawing-up and presentation of the accounts (2) in accordance with the internal financial provisions adopted on the basis of Article 112 of Council Regulation (EC) No 2100/94. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the Office's annual accounts for the financial year ended 31 December 2003. In accordance with Article 110 of Council Regulation (EC) No 2100/94, the Office's budget was implemented on the responsibility of its President. This responsibility includes the drawing-up and presentation of the accounts (2) in accordance with the internal financial provisions adopted on the basis of Article 112 of Council Regulation (EC) No 2100/94. The Court is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the auditing procedures it considered necessary in the context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its auditing policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the auditing procedures it considered necessary in the context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report.

OBSERVATIONS

| 6. | The implementation of the appropriations for the 2003 financial year and of the appropriations carried over from the previous year is shown in Table 2. The revenue and expenditure account and the balance sheet published by the Office for the financial year 2003 are shown in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the 2003 financial year and of the appropriations carried over from the previous year is shown in Table 2. The revenue and expenditure account and the balance sheet published by the Office for the financial year 2003 are shown in summary form in Tables 3 and 4.

| 7. | Article 8 of the Office's new financial regulation provides that the budget shall contain differentiated appropriations, which make a distinction between commitment appropriations and payment appropriations. Even though the 2003 budget was adopted before the new rules and only contains non-differentiated appropriations, at the moment of closure of the accounts the Office considered the appropriations under Title III, which finance its operations, to be differentiated. In order to take this approach, the Office ought to have adopted an amending budget that distinguished, with appropriate comments, between the commitment appropriations and the payment appropriations. This was not the case. |
| --- | --- |

7.

Article 8 of the Office's new financial regulation provides that the budget shall contain differentiated appropriations, which make a distinction between commitment appropriations and payment appropriations. Even though the 2003 budget was adopted before the new rules and only contains non-differentiated appropriations, at the moment of closure of the accounts the Office considered the appropriations under Title III, which finance its operations, to be differentiated. In order to take this approach, the Office ought to have adopted an amending budget that distinguished, with appropriate comments, between the commitment appropriations and the payment appropriations. This was not the case.

| 8. | The balance sheet shows an unrecovered sum of 216 048 euro of VAT paid between 1997 and 2001. Most of this sum (206 553 euro) may be attributed to requests for repayment which have been refused by the French authorities. The Office should first examine the possible legal means of recovering this sum and then make the necessary adjustments. |
| --- | --- |

8.

The balance sheet shows an unrecovered sum of 216 048 euro of VAT paid between 1997 and 2001. Most of this sum (206 553 euro) may be attributed to requests for repayment which have been refused by the French authorities. The Office should first examine the possible legal means of recovering this sum and then make the necessary adjustments.

| 9. | Article 42(1)(e) of the Office's financial regulation provides that the accounting officer shall validate the systems laid down by the authorising officer to supply or justify accounting information. This validation has not yet taken place. |
| --- | --- |

9.

Article 42(1)(e) of the Office's financial regulation provides that the accounting officer shall validate the systems laid down by the authorising officer to supply or justify accounting information. This validation has not yet taken place.

| 10. | The Office's accounting system is made up of three computerised systems, one for the administration of applications for the grant of Community plant variety rights (PVR), one for the budgetary accounts (SI2) and one for the general accounts. The Office ought to work towards integrating these systems, so as to eliminate themany minor errors thatarise from the use of non-accounting procedures that multiply the number of data acquisition operations. |
| --- | --- |

10.

The Office's accounting system is made up of three computerised systems, one for the administration of applications for the grant of Community plant variety rights (PVR), one for the budgetary accounts (SI2) and one for the general accounts. The Office ought to work towards integrating these systems, so as to eliminate themany minor errors thatarise from the use of non-accounting procedures that multiply the number of data acquisition operations.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 227, 1.9.1994, p. 27.

1

(2)  In accordance with Article 111(2) of Council Regulation (EC) No 2100/94, the accounts for all the Office's revenue and expenditure for the financial year 2003 were drawn up on 25 March 2004 and forwarded to the Court of Auditors. The Court received these accounts on 24 September 2004. A summarised version of these accounts is presented in the tables attached to this report.

2

---

Table 1

Community Plant Variety Office (Angers)

| Areas of Community competence deriving from the Treaty | Competence of the Office as defined in Council Regulation (EC)
  No 2100/94 of 27 July 1994 | Governance | Resources available to the Agency

  (data for 2002) | Products and services supplied in 2003

  (data for 2002) |
| --- | --- | --- | --- | --- |
| Free movement of goods

  Prohibitions or restrictions justified on grounds of the protection of industrial and commercial property shall not constitute a means of arbitrary discrimination or a disguised restriction on trade between the Member States

  (Extract from Article 30 of the Treaty) | Objectives

  To apply the system of Community plant variety rights as the sole and exclusive form of Community industrial property rights for plant varieties | Tasks







  — | To register and examine applications for Community plant variety rights |

Areas of Community competence deriving from the Treaty

Competence of the Office as defined in Council Regulation (EC)

No 2100/94 of 27 July 1994

Governance

Resources available to the Agency

(data for 2002)

Products and services supplied in 2003

(data for 2002)

Free movement of goods

Prohibitions or restrictions justified on grounds of the protection of industrial and commercial property shall not constitute a means of arbitrary discrimination or a disguised restriction on trade between the Member States

(Extract from Article 30 of the Treaty)

Objectives

To apply the system of Community plant variety rights as the sole and exclusive form of Community industrial property rights for plant varieties

Tasks

—

To register and examine applications for Community plant variety rights

| — | To decide whether to grant plant variety rights |
| --- | --- |

—

To decide whether to grant plant variety rights

| — | To ensure that the necessary technical examinations are carried out by the competent offices in the Member States |
| --- | --- |

—

To ensure that the necessary technical examinations are carried out by the competent offices in the Member States

| — | To charge fees |
| --- | --- |

—

To charge fees

| — | To verify the proposed variety denominations |
| --- | --- |

—

To verify the proposed variety denominations

| — | To maintain a register of all applications made and all rights granted |
| --- | --- |

—

To maintain a register of all applications made and all rights granted

| 1. | Administrative Council

  Composition






  — | One representative of each Member State |
| --- | --- | --- |

1.

Administrative Council

—

One representative of each Member State

| — | One representative of the Commission and their alternates |
| --- | --- |

—

One representative of the Commission and their alternates

| — | To draw up rules governing the working methods of the Office |
| --- | --- |

—

To draw up rules governing the working methods of the Office

| — | To act as the budgetary authority |
| --- | --- |

—

To act as the budgetary authority

| — | To oversee the work programme and working methods |
| --- | --- |

—

To oversee the work programme and working methods

| 2. | President of the Office

  Appointed by the Council from a list of candidates proposed by the Commission after obtaining the opinion of the Administrative Council |
| --- | --- |

2.

President of the Office

Appointed by the Council from a list of candidates proposed by the Commission after obtaining the opinion of the Administrative Council

| 3. | Board of Appeal

  Decides on appeals against decisions concerning plant variety rights |
| --- | --- |

3.

Board of Appeal

Decides on appeals against decisions concerning plant variety rights

| 4. | Audit by the Commission

  The Commission checks the legality of the Office's budget and of those acts by the President whose legality is not checked by another body |
| --- | --- |

4.

Audit by the Commission

The Commission checks the legality of the Office's budget and of those acts by the President whose legality is not checked by another body

| 5. | External audit

  Court of Auditors |
| --- | --- |

5.

External audit

Court of Auditors

| 6. | Discharge authority

  Administrative Council |
| --- | --- |

6.

Discharge authority

Administrative Council

Final budget:

11,1 million euro (10,5 million euro)

Community contribution: 0 % (0 %)

Staff numbers as at 31 December 2003:

Number of posts in establishment plan: 35 (33)

Posts occupied: 34 (28)

1 (2) other posts (auxiliary contracts, national experts on secondment, local staff, temporary staff)

Total staff: 35(30)

Assigned to the following duties:

| — | operational: 13 (10) |
| --- | --- |

—

operational: 13 (10)

| — | administrative: 16 (15) |
| --- | --- |

—

administrative: 16 (15)

| — | mixed: 6 (5) |
| --- | --- |

—

mixed: 6 (5)

Applications heard:

2 516(2 223)

External technical examinations:

1 929(1 295)

Rights granted:

1 869 (1 704)

Community rights in force on 31.12.2003: 8 764

(on 31.12.2002: 7 800)

Source:Information supplied by the Office.

Table 2

Community Plant Variety Office — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Origin of revenue | Revenue entered in the final budget for the financial year | Revenue collected | Expenditure allocation | Appropriations in the final budget | Appropriations carried over from the previous financial year | Available appropriations
  (2003 budget and 2002 financial year) |
| entered | committed | paid | carried over | cancelled | outstanding commitments | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Own revenue | 7,4 | 8,2 | Title I
  Staff | 3,6 | 3,5 | 3,2 | 0,1 | 0,2 | 0,0 | 0,0 | 0,0 | 3,6 | 3,5 | 3,3 | 0,1 | 0,2 |
| Administrative revenue | 0,2 | 0,0 | Title II
  Administration | 1,0 | 0,8 | 0,6 | 0,2 | 0,2 | 0,2 | 0,1 | 0,0 | 1,2 | 0,8 | 0,7 | 0,2 | 0,3 |
| Miscellaneous revenue | 0,0 | 0,1 | Title III
  Operating activities | 6,6 | 6,1 | 1,2 | 4,9 | 0,5 | 3,7 | 1,3 | 0,2 | 10,3 | 6,1 | 2,5 | 4,9 | 0,7 |
| Financial revenue | 0,4 | 0,4 | | | | | | | | | | | | | | |
| Budgetary balance from the previous financial year | 3,2 | 0,0 | | | | | | | | | | | | | | |
| Total | 11,1 | 8,8 | Total | 11,1 | 10,4 | 5,0 | 5,2 | 1,0 | 3,9 | 1,5 | 0,2 | 15,0 | 10,4 | 6,5 | 5,2 | 1,2 |
| NB:The totals may include differences due to rounding.

  Source:information supplied by the Office. These tables summarise the data provided by the Office in its own accounts. |

(million euro)

Revenue

Expenditure

Origin of revenue

Revenue entered in the final budget for the financial year

Revenue collected

Expenditure allocation

Appropriations in the final budget

Appropriations carried over from the previous financial year

Available appropriations

(2003 budget and 2002 financial year)

entered

committed

paid

carried over

cancelled

outstanding commitments

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Own revenue

7,4

8,2

Title I

Staff

3,6

3,5

3,2

0,1

0,2

0,0

0,0

0,0

3,6

3,5

3,3

0,1

0,2

Administrative revenue

0,2

0,0

Title II

Administration

1,0

0,8

0,6

0,2

0,2

0,2

0,1

0,0

1,2

0,8

0,7

0,2

0,3

Miscellaneous revenue

0,0

0,1

Title III

Operating activities

6,6

6,1

1,2

4,9

0,5

3,7

1,3

0,2

10,3

6,1

2,5

4,9

0,7

Financial revenue

0,4

0,4

Budgetary balance from the previous financial year

3,2

0,0

Total

11,1

8,8

Total

11,1

10,4

5,0

5,2

1,0

3,9

1,5

0,2

15,0

10,4

6,5

5,2

1,2

NB:The totals may include differences due to rounding.

Source:information supplied by the Office. These tables summarise the data provided by the Office in its own accounts.

Table 3

Community Plant Variety Office — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Own revenue | 8 199 | 8 564 |
| Miscellaneous revenue | 156 | 61 |
| Financial revenue | 401 | 615 |
| Total revenue (a) | 8 757 | 9 240 |
| Expenditure |
| Staff — Title I of the budget |
| Payments | 3 245 | 2 807 |
| Appropriations carried over | 98 | 26 |
| Administration — Title II of the budget |
| Payments | 583 | 570 |
| Appropriations carried over | 195 | 163 |
| Operating activities — Title III of the budget |
| Payments | 1 179 | 975 |
| Appropriations carried over | 4 863 | 3 699 |
| Total expenditure (b) | 10 164 | 8 239 |
| Outturn for the financial year (a – b) | –1 407 | 1 001 |
| Balance carried over from the previous financial year | 13 977 | 11 029 |
| Appropriations carried over and cancelled | 249 | 1 949 |
| Exchange-rate differences | 0 | –3 |
| Future provision | 5 | 0 |
| Balance for the financial year | 12 825 | 13 977 |
| NB:The totals may include differences due to rounding.

  Source:information supplied by the Office. These tables summarise the data provided by the Office in its own accounts. |

(1000 euro)

2003

2002

Revenue

Own revenue

8 199

8 564

Miscellaneous revenue

156

61

Financial revenue

401

615

Total revenue (a)

8 757

9 240

Expenditure

Staff — Title I of the budget

Payments

3 245

2 807

Appropriations carried over

98

26

Administration — Title II of the budget

Payments

583

570

Appropriations carried over

195

163

Operating activities — Title III of the budget

Payments

1 179

975

Appropriations carried over

4 863

3 699

Total expenditure (b)

10 164

8 239

Outturn for the financial year (a – b)

–1 407

1 001

Balance carried over from the previous financial year

13 977

11 029

Appropriations carried over and cancelled

249

1 949

Exchange-rate differences

0

–3

Future provision

5

0

Balance for the financial year

12 825

13 977

NB:The totals may include differences due to rounding.

Source:information supplied by the Office. These tables summarise the data provided by the Office in its own accounts.

Table 4

Community Plant Variety Office — Balance sheet at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets | | | Fixed capital | | |
| Computer software | 78 | 68 | Own capital | 2 538 | 2 503 |
| Buildings | 2 427 | 2 404 | | | |
| Computer equipment | 219 | 229 | Reserve | 13 977 | 11 029 |
| Equipment and furniture | 161 | 140 | Balance for the financial year | –1 153 | 2 948 |
| Depreciation | – 345 | – 338 | Subtotal | 15 363 | 16 480 |
| | | | Current liabilities | | |
| Subtotal | 2 538 | 2 503 | Outstanding commitments in respect of carry-overs from 2002 | 2 145 | 0 |
| Indemnities and guarantees | 3 | 0 | Automatic carry-overs | 5 156 | 3 887 |
| Current assets | | | Suppliers | 1 | 160 |
| Recovery orders | 3 | 51 | Advances from customers | 194 | 366 |
| Sundry accounts receivable | 29 | 24 | VAT to be paid | 216 | 216 |
| VAT to be recovered | 371 | 384 | Deductions from salaries | 9 | 32 |
| Subtotal | 403 | 459 | Subtotal | 7 721 | 4 661 |
| Cash accounts | | | | | |
| Banks | 20 065 | 18 103 | | | |
| Imprest account | 75 | 75 | | | |
| Subtotal | 20 140 | 18 178 | | | |
| Total | 23 084 | 21 141 | Total | 23 084 | 21 141 |
| NB:The totals may include differences due to rounding.

  Source:information supplied by the Office. These tables summarise the data provided by the Office in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets

Fixed capital

Computer software

78

68

Own capital

2 538

2 503

Buildings

2 427

2 404

Computer equipment

219

229

Reserve

13 977

11 029

Equipment and furniture

161

140

Balance for the financial year

–1 153

2 948

Depreciation

– 345

– 338

Subtotal

15 363

16 480

Current liabilities

Subtotal

2 538

2 503

Outstanding commitments in respect of carry-overs from 2002

2 145

0

Indemnities and guarantees

3

0

Automatic carry-overs

5 156

3 887

Current assets

Suppliers

1

160

Recovery orders

3

51

Advances from customers

194

366

Sundry accounts receivable

29

24

VAT to be paid

216

216

VAT to be recovered

371

384

Deductions from salaries

9

32

Subtotal

403

459

Subtotal

7 721

4 661

Cash accounts

Banks

20 065

18 103

Imprest account

75

75

Subtotal

20 140

18 178

Total

23 084

21 141

Total

23 084

21 141

NB:The totals may include differences due to rounding.

Source:information supplied by the Office. These tables summarise the data provided by the Office in its own accounts.

---

THE OFFICE'S REPLIES

| 7. | The wording of Article 8 of the new Financial Regulation suggests that once the new Regulation had entered into force on 16 September 2003, appropriations under Title III may de facto be considered differentiated. The Office considers that the adoption by the budgetary authority of the 2004 budget, which included differentiated appropriations taking account of previous commitments still to be paid, makes up for the lack of an amending budget. |
| --- | --- |

7.

The wording of Article 8 of the new Financial Regulation suggests that once the new Regulation had entered into force on 16 September 2003, appropriations under Title III may de facto be considered differentiated. The Office considers that the adoption by the budgetary authority of the 2004 budget, which included differentiated appropriations taking account of previous commitments still to be paid, makes up for the lack of an amending budget.

| 8. | The Office will submit a new request for the reimbursement of the outstanding EUR 206 553. As regards the remaining EUR 9 495, a decision will be taken before the end of the year. |
| --- | --- |

8.

The Office will submit a new request for the reimbursement of the outstanding EUR 206 553. As regards the remaining EUR 9 495, a decision will be taken before the end of the year.

| 9. | This validation is being finalised. |
| --- | --- |

9.

This validation is being finalised.

| 10. | The Office is looking at improved integration of its computer systems. Some elements have already been put in place, such as: automatic transfer of clients' debit and credit notes, automatic transfer of clients' and suppliers' data and automatic transfers of suppliers' invoices. |
| --- | --- |

10.

The Office is looking at improved integration of its computer systems. Some elements have already been put in place, such as: automatic transfer of clients' debit and credit notes, automatic transfer of clients' and suppliers' data and automatic transfers of suppliers' invoices.

---

| 30.12.2004 | EN | Official Journal of the European Union | C 324/106 |
| --- | --- | --- | --- |

30.12.2004

EN

Official Journal of the European Union

C 324/106

---

REPORT

on the annual accounts of the Office for Harmonization in the Internal Market for the 2003 financial year together with the Office's replies

(2004/C 0324/15)

CONTENTS

| 1 | INTRODUCTION |
| --- | --- |

1

| 2-5 | THE COURT'S OPINION |
| --- | --- |

2-5

| 6-10 | OBSERVATIONS |
| --- | --- |

6-10

Tables 1–4

The Office's replies

INTRODUCTION

| 1. | The Office for Harmonization in the Internal Market (hereinafter called ‘the Office’) was set up by Council Regulation (EC) No 40/94 (1) of 20 December 1993. Its mandate is to implement the Community legislation on trade marks and designs, which gives undertakings uniform protection throughout the area of the Union. The Office's duties and activities are summarised, on the basis of information submitted by the Office, in Table 1. |
| --- | --- |

1.

The Office for Harmonization in the Internal Market (hereinafter called ‘the Office’) was set up by Council Regulation (EC) No 40/94 (1) of 20 December 1993. Its mandate is to implement the Community legislation on trade marks and designs, which gives undertakings uniform protection throughout the area of the Union. The Office's duties and activities are summarised, on the basis of information submitted by the Office, in Table 1.

THE COURT's OPINION

| 2. | This opinion is addressed to the Office's Budget Committee pursuant to Article 137(2) of Council Regulation (EC) No 40/94 (). |
| --- | --- |

2.

This opinion is addressed to the Office's Budget Committee pursuant to Article 137(2) of Council Regulation (EC) No 40/94 ().

| 3. | The Court has examined the Office's annual accounts for the financial ended 31 December 2003. In accordance with Article 119(2)(c) of Council Regulation (EC) No 40/94, the Office's budget was implemented on the responsibility of its President. This responsibility includes the drawing-up and presentation of the accounts (2), in accordance with the internal financial provisions provided for in Article 138 of Council Regulation (EC) No 40/94. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
| --- | --- |

3.

The Court has examined the Office's annual accounts for the financial ended 31 December 2003. In accordance with Article 119(2)(c) of Council Regulation (EC) No 40/94, the Office's budget was implemented on the responsibility of its President. This responsibility includes the drawing-up and presentation of the accounts (2), in accordance with the internal financial provisions provided for in Article 138 of Council Regulation (EC) No 40/94. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

| 4. | The Court carried out its audit in accordance with its audit policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context. |
| --- | --- |

4.

The Court carried out its audit in accordance with its audit policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context.

| 5. | The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended on 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report. |
| --- | --- |

5.

The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended on 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report.

OBSERVATIONS

| 6. | The implementation of the appropriations for the financial year 2003, and of the appropriations carried over from the previous year, is set out in Table 2. The Office's revenue and expenditure account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4. |
| --- | --- |

6.

The implementation of the appropriations for the financial year 2003, and of the appropriations carried over from the previous year, is set out in Table 2. The Office's revenue and expenditure account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4.

| 7. | The total value of appropriations carried over was 18,3 million euro. More attention should be given to evaluating whether carry-overs are really necessary. Tests performed on a 35 % sample of this amount revealed unjustified carry-overs of around 586 000 euro, 350 000 euro for search reports and 236 000 euro for professional training activities. |
| --- | --- |

7.

The total value of appropriations carried over was 18,3 million euro. More attention should be given to evaluating whether carry-overs are really necessary. Tests performed on a 35 % sample of this amount revealed unjustified carry-overs of around 586 000 euro, 350 000 euro for search reports and 236 000 euro for professional training activities.

| 8. | A large number of carry-overs correspond to provisional commitments, the unused balance of which is carried over at the year's end in its entirety, even where all or part of this balance does not relate to duly contracted obligations. This situation is irregular. |
| --- | --- |

8.

A large number of carry-overs correspond to provisional commitments, the unused balance of which is carried over at the year's end in its entirety, even where all or part of this balance does not relate to duly contracted obligations. This situation is irregular.

| 9. | Computer licences and software are not included under fixed assets, in contravention of the Regulation on inventory (3). As at 31 December 2003, it was estimated that they might have a value of up to 700 000 euro. |
| --- | --- |

9.

Computer licences and software are not included under fixed assets, in contravention of the Regulation on inventory (3). As at 31 December 2003, it was estimated that they might have a value of up to 700 000 euro.

| 10. | In spite of the Court's previous observations (4), the Office has not reviewed its inventory system: duties are still poorly defined and there is still insufficient staff training. It is difficult to keep the inventory correctly in such circumstances. For example, items of computer equipment and furniture recorded in the accounts at a value of around 500 000 euro could not be located when a physical inventory was made. |
| --- | --- |

10.

In spite of the Court's previous observations (4), the Office has not reviewed its inventory system: duties are still poorly defined and there is still insufficient staff training. It is difficult to keep the inventory correctly in such circumstances. For example, items of computer equipment and furniture recorded in the accounts at a value of around 500 000 euro could not be located when a physical inventory was made.

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President

---

(1)  OJ L 11, 14.1.1994.

1

(2)  As required under Article 137(1) of Council Regulation (EC) No 40/94, the accounts of all the Office's revenue and expenditure for the 2003 financial year were drawn up on 28 February 2004 and sent to the Court of Auditors. They were received by the Court on 24 September 2004. A summarised version of these accounts is presented in the tables annexed to this report.

2

(3)  Commission Regulation (EC) No 2909/2000 of 29 December 2000 (OJ L 336, 30.12.2000, p. 75).

3

(4)  Paragraph 13 of the report on the financial year 2002 (OJ C 319, 30.12.2003, p. 84).

4

---

Table 1

Office for Harmonization in the Internal Market (Alicante)

| Area of Community competence deriving from the Treaty | Competence of the Office as specified in the Parliament and Council Regulation — Council Regulation (EC) No 40/94 of 20 December 1993 | Governance | Resources available to the Office in 2003
  (2002 figures) | Products and services supplied in 2003 |
| --- | --- | --- | --- | --- |
| Free movement of goods

  Prohibitions or restrictions justified on grounds of the protection of industrial and commercial property must not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. (From Article 30 of the Treaty)

  Restrictions on freedom to provide services within the Community are prohibited in respect of nationals of Member States who are established in a State of the Community other than that of the person for whom the services are intended. (From Article 49 of the Treaty) | Objectives

  To implement the Community legislation on trade marks and designs, which gives undertakings the right to uniform protection throughout the area of the Union | Tasks







  — | To receive and enter applications for registration |

Area of Community competence deriving from the Treaty

Competence of the Office as specified in the Parliament and Council Regulation — Council Regulation (EC) No 40/94 of 20 December 1993

Governance

Resources available to the Office in 2003

(2002 figures)

Products and services supplied in 2003

Free movement of goods

Prohibitions or restrictions justified on grounds of the protection of industrial and commercial property must not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. (From Article 30 of the Treaty)

Restrictions on freedom to provide services within the Community are prohibited in respect of nationals of Member States who are established in a State of the Community other than that of the person for whom the services are intended. (From Article 49 of the Treaty)

Objectives

To implement the Community legislation on trade marks and designs, which gives undertakings the right to uniform protection throughout the area of the Union

Tasks

—

To receive and enter applications for registration

| — | To examine the conditions for entry in the Register and compatibility with Community legislation |
| --- | --- |

—

To examine the conditions for entry in the Register and compatibility with Community legislation

| — | To search at the industrial property offices of the Member States for any pre-existing national trade marks |
| --- | --- |

—

To search at the industrial property offices of the Member States for any pre-existing national trade marks

| — | To publish applications |
| --- | --- |

—

To publish applications

| — | To examine any opposition by third parties |
| --- | --- |

—

To examine any opposition by third parties

| — | To register or reject applications |
| --- | --- |

—

To register or reject applications

| — | To examine applications for revocation or invalidity |
| --- | --- |

—

To examine applications for revocation or invalidity

| — | To handle appeals against decisions |
| --- | --- |

—

To handle appeals against decisions

| 1. | Administrative Board

  Composition






  — | one representative of each Member State |
| --- | --- | --- |

1.

Administrative Board

—

one representative of each Member State

| — | one representative of the Commission |
| --- | --- |

—

one representative of the Commission

| — | To advise the President on matters for which the Office is responsible To prepare lists of candidates (Article 120) for President, Vice-Presidents and chairmen and members of the Boards of Appeal |
| --- | --- |

—

To advise the President on matters for which the Office is responsible To prepare lists of candidates (Article 120) for President, Vice-Presidents and chairmen and members of the Boards of Appeal

| 2. | President of the Office

  Appointed by the Council from a list of at most three candidates which has been prepared by the Administrative Board |
| --- | --- |

2.

President of the Office

Appointed by the Council from a list of at most three candidates which has been prepared by the Administrative Board

| 3. | Budget Committee

  Composition
  One representative of each Member State and one representative of the Commission and their alternates
  Task
  To adopt the budget and the financial regulation, grant discharge to the President and determine the cost of search reports |
| --- | --- |

3.

Budget Committee

One representative of each Member State and one representative of the Commission and their alternates

To adopt the budget and the financial regulation, grant discharge to the President and determine the cost of search reports

| 4. | Decisions in connection with procedures

  Decisions are taken by:






  (a) | the Examiners; |
| --- | --- | --- |

4.

Decisions in connection with procedures

Decisions are taken by:

(a)

the Examiners;

| (b) | the Opposition Divisions; |
| --- | --- |

(b)

the Opposition Divisions;

| (c) | the Administration of Trade Marks and Legal Division; |
| --- | --- |

(c)

the Administration of Trade Marks and Legal Division;

| (d) | the Cancellation Divisions; |
| --- | --- |

(d)

the Cancellation Divisions;

| (e) | the Boards of Appeal |
| --- | --- |

(e)

the Boards of Appeal

| 5. | External audit

  The European Court of Auditors |
| --- | --- |

5.

External audit

The European Court of Auditors

| 6. | Discharge authority

  The Office's Budget Committee |
| --- | --- |

6.

Discharge authority

The Office's Budget Committee

Final budget

157 million euro (155 million euro). Community contribution: 0 % (0 %)

Staff numbers as at 31 December 2003

Number of posts in establishment plan: 675 (675)

Posts occupied: 650 (633)

+31 (*) other staff (auxiliary contracts, seconded national experts, local employees, temporary replacements)

Total staff: 681 (*)

Assigned to the following duties:

| — | operational: 423 (*) |
| --- | --- |

—

operational: 423 (*)

| — | administrative: 245 (*) |
| --- | --- |

—

administrative: 245 (*)

| — | mixed: 13 (*) |
| --- | --- |

—

mixed: 13 (*)

(*): figures unavailable for 2002

Trade marks

Number of applications: 57 637

Number of registrations: 34 290

Number of cases of opposition: 9 929

Number of cases settled: 9 396

Appeals to the Boards of Appeal: 719

Average time for registration (excluding opposition or appeal):

| — | before publication: 12 months |
| --- | --- |

—

before publication: 12 months

| — | between publication and registration: 6 months |
| --- | --- |

—

between publication and registration: 6 months

Designs

Designs received: 37 084

Designs registered: 24 801

Source:Information submitted by the Office.

Table 2

Office for Harmonization in the Internal Market — Implementation of the budget for the 2003 financial year

| (million euro) |
| --- |
| Revenue | Expenditure |
| Source of revenue | Revenue entered in the final budget for the financial year | Revenue received | Allocation of expenditure | Final budget appropriations | Appropriations carried over from the previous financial year | Appropriations available
  (2003 budget and 2002 financial year) |
| entered | committed | paid | carried over | cancelled | commitments outstanding | paid | cancelled | appropriations | committed | paid | carried over | cancelled |
| Fees | 101,4 | 105,6 | Title I
  Staff | 52,4 | 48,6 | 47,4 | 1,2 | 3,8 | 0,9 | 0,7 | 0,2 | 53,3 | 49,5 | 48,1 | 1,2 | 4,0 |
| Other revenue | 4,3 | 4,9 | Title II
  Administration | 26,1 | 24,3 | 16,4 | 7,9 | 1,8 | 9,7 | 9,3 | 0,4 | 35,8 | 34,0 | 25,7 | 7,9 | 2,2 |
| Outturn for the previous financial year | 51,7 | 55,4 | Title III
  Operating activities | 27,2 | 23,4 | 14,1 | 9,3 | 3,8 | 8,7 | 7,8 | 0,9 | 35,9 | 32,1 | 21,9 | 9,3 | 4,7 |
| Title X Reserve | 51,7 | 0,0 | 0,0 | 0,0 | 51,7 | 0,0 | 0,0 | 0,0 | 51,7 | 0,0 | 0,0 | 0,0 | 51,7 |
| Total | 157,4 | 165,9 | Total | 157,4 | 96,3 | 77,9 | 18,4 | 61,1 | 19,3 | 17,8 | 1,5 | 176,7 | 115,6 | 95,7 | 18,4 | 62,6 |
| NB:Totals may include differences due to rounding

  Source:Office data — These tables summarise the data supplied by the Office in its own accounts. |

(million euro)

Revenue

Expenditure

Source of revenue

Revenue entered in the final budget for the financial year

Revenue received

Allocation of expenditure

Final budget appropriations

Appropriations carried over from the previous financial year

Appropriations available

(2003 budget and 2002 financial year)

entered

committed

paid

carried over

cancelled

commitments outstanding

paid

cancelled

appropriations

committed

paid

carried over

cancelled

Fees

101,4

105,6

Title I

Staff

52,4

48,6

47,4

1,2

3,8

0,9

0,7

0,2

53,3

49,5

48,1

1,2

4,0

Other revenue

4,3

4,9

Title II

Administration

26,1

24,3

16,4

7,9

1,8

9,7

9,3

0,4

35,8

34,0

25,7

7,9

2,2

Outturn for the previous financial year

51,7

55,4

Title III

Operating activities

27,2

23,4

14,1

9,3

3,8

8,7

7,8

0,9

35,9

32,1

21,9

9,3

4,7

Title X

Reserve

51,7

0,0

0,0

0,0

51,7

0,0

0,0

0,0

51,7

0,0

0,0

0,0

51,7

Total

157,4

165,9

Total

157,4

96,3

77,9

18,4

61,1

19,3

17,8

1,5

176,7

115,6

95,7

18,4

62,6

NB:Totals may include differences due to rounding

Source:Office data — These tables summarise the data supplied by the Office in its own accounts.

Table 3

Office for Harmonization in the Internal Market — Revenue and expenditure account for the financial years 2003 and 2002

| (1000 euro) |
| --- |
| | 2003 | 2002 |
| Revenue |
| Own revenue | 107 056 | 97 329 |
| Financial revenue | 3 460 | 3 141 |
| Total revenue (a) | 110 516 | 100 470 |
| Budgetary expenditure for the financial year |
| Staff — Title I of the budget |
| Payments | 47 416 | 46 106 |
| Appropriations carried over | 1 168 | 934 |
| Administration — Title II of the budget |
| Payments | 16 366 | 15 095 |
| Appropriations carried over | 7 891 | 9 718 |
| Operating activities — Title III of the budget |
| Payments | 14 137 | 16 431 |
| Appropriations carried over | 9 262 | 8 651 |
| Total expenditure (b) | 96 240 | 96 934 |
| Outturn for the financial year (a – b) | 14 276 | 3 536 |
| Other expenditure/provisions for the year |
| Provision for procedural expenditure | 1 094 | –1 363 |
| Subtotal | 1 094 | –1 363 |
| Balance carried over from the previous financial year | 55 368 | 51 349 |
| Appropriations carried over and cancelled | 1 506 | 1 817 |
| Sums for re-use from the previous financial year not used | 115 | 11 |
| Provision for procedural expenditure from previous financial years | 0 | 0 |
| Exchange-rate differences and extraordinary revenue | –6 | 17 |
| Balance for the financial year | 72 353 | 55 368 |
| NB:Totals may include differences due to rounding.

  Source:Office data — These tables summarise the data supplied by the Office in its own accounts. |

(1000 euro)

2003

2002

Revenue

Own revenue

107 056

97 329

Financial revenue

3 460

3 141

Total revenue (a)

110 516

100 470

Budgetary expenditure for the financial year

Staff — Title I of the budget

Payments

47 416

46 106

Appropriations carried over

1 168

934

Administration — Title II of the budget

Payments

16 366

15 095

Appropriations carried over

7 891

9 718

Operating activities — Title III of the budget

Payments

14 137

16 431

Appropriations carried over

9 262

8 651

Total expenditure (b)

96 240

96 934

Outturn for the financial year (a – b)

14 276

3 536

Other expenditure/provisions for the year

Provision for procedural expenditure

1 094

–1 363

Subtotal

1 094

–1 363

Balance carried over from the previous financial year

55 368

51 349

Appropriations carried over and cancelled

1 506

1 817

Sums for re-use from the previous financial year not used

115

11

Provision for procedural expenditure from previous financial years

0

0

Exchange-rate differences and extraordinary revenue

–6

17

Balance for the financial year

72 353

55 368

NB:Totals may include differences due to rounding.

Source:Office data — These tables summarise the data supplied by the Office in its own accounts.

Table 4

Office for Harmonization in the Internal Market — Balance sheet as at 31 December 2003 and 31 December 2002

| (1000 euro) |
| --- |
| Assets | 2003 | 2002 | Liabilities | 2003 | 2002 |
| Fixed assets | | | Fixed capital | | |
| Buildings | 26 747 | 26 286 | Own capital | 27 921 | 28 065 |
| Equipment and furniture | 3 828 | 3 783 | Balance for the financial year | 72 353 | 55 368 |
| Transport equipment | 115 | 111 | Subtotal | 100 274 | 83 433 |
| Computer equipment | 11 241 | 9 636 | Long-term debt | | |
| Intangible assets | 24 | 24 | Long-term creditors | 24 | 23 |
| Depreciation | –14 035 | –11 775 | Subtotal | 24 | 23 |
| Subtotal | 27 920 | 28 065 | Current liabilities | | |
| Current assets | | | Automatic carry-overs of appropriations | 18 322 | 19 303 |
| Suppliers and missions | 200 | 167 | Advances from clients | 29 395 | 22 289 |
| Other sundry accounts receivable | 107 | 89 | Amounts outstanding | 51 | 14 |
| Subtotal | 307 | 256 | Sundry accounts payable | 757 | 664 |
| Cash accounts | | | Provision for procedural expenditure | 13 644 | 14 738 |
| Bank accounts | 134 239 | 112 256 | Subtotal | 62 169 | 57 008 |
| Cash | 1 | 2 | Suspense accounts | | |
| Subtotal | 134 240 | 112 258 | Revenue to be re-used | 0 | 115 |
| | | | Subtotal | 0 | 115 |
| Total | 162 467 | 140 579 | Total | 162 467 | 140 579 |
| NB:Totals may include differences due to rounding.

  Source:Office data — These tables summarise the data supplied by the Office in its own accounts. |

(1000 euro)

Assets

2003

2002

Liabilities

2003

2002

Fixed assets

Fixed capital

Buildings

26 747

26 286

Own capital

27 921

28 065

Equipment and furniture

3 828

3 783

Balance for the financial year

72 353

55 368

Transport equipment

115

111

Subtotal

100 274

83 433

Computer equipment

11 241

9 636

Long-term debt

Intangible assets

24

24

Long-term creditors

24

23

Depreciation

–14 035

–11 775

Subtotal

24

23

Subtotal

27 920

28 065

Current liabilities

Current assets

Automatic carry-overs of appropriations

18 322

19 303

Suppliers and missions

200

167

Advances from clients

29 395

22 289

Other sundry accounts receivable

107

89

Amounts outstanding

51

14

Subtotal

307

256

Sundry accounts payable

757

664

Cash accounts

Provision for procedural expenditure

13 644

14 738

Bank accounts

134 239

112 256

Subtotal

62 169

57 008

Cash

1

2

Suspense accounts

Subtotal

134 240

112 258

Revenue to be re-used

0

115

Subtotal

0

115

Total

162 467

140 579

Total

162 467

140 579

NB:Totals may include differences due to rounding.

Source:Office data — These tables summarise the data supplied by the Office in its own accounts.

---

THE OFFICE'SREPLIES

| 7. | Concerning the search reports, the improvement in the computer application used to manage these reports, the abolition of the annual adjustment as from 1 January 2004 and the establishment of specific commitments for each of the national offices will help to better evaluate the appropriations to be carried over. For training, commitment requirements will be the subject of two examinations as from 2004, one in August and another in December. Amounts are already being decommitted as measures are being implemented. |
| --- | --- |

7.

Concerning the search reports, the improvement in the computer application used to manage these reports, the abolition of the annual adjustment as from 1 January 2004 and the establishment of specific commitments for each of the national offices will help to better evaluate the appropriations to be carried over. For training, commitment requirements will be the subject of two examinations as from 2004, one in August and another in December. Amounts are already being decommitted as measures are being implemented.

| 8. | The Office has taken note of this observation and will take the necessary measures to reduce the carry-overs corresponding to provisional commitments. |
| --- | --- |

8.

The Office has taken note of this observation and will take the necessary measures to reduce the carry-overs corresponding to provisional commitments.

| 9. | The Office will examine all the contracts concerned in order to determine the exact amount to be recorded as intangible assets in accordance with Commission Regulation (EC) No 2909/2000. |
| --- | --- |

9.

The Office will examine all the contracts concerned in order to determine the exact amount to be recorded as intangible assets in accordance with Commission Regulation (EC) No 2909/2000.

| 10. | Since 2003, the Office has been implementing measures to improve the keeping of its inventory, in particular by reorganising the inventory under a single department, aligning the headings with those of the Commission and reviewing the labelling and decommissioning of assets. Concerning the definition of duties and training, the Office is currently reviewing the Regulation on inventory and the underlying procedures and drawing up written instructions for physical inventory verification. |
| --- | --- |

10.

Since 2003, the Office has been implementing measures to improve the keeping of its inventory, in particular by reorganising the inventory under a single department, aligning the headings with those of the Commission and reviewing the labelling and decommissioning of assets. Concerning the definition of duties and training, the Office is currently reviewing the Regulation on inventory and the underlying procedures and drawing up written instructions for physical inventory verification.

---