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ARTICLE 21

ARTICLE 78 OF THE TREATY ESTABLISHING THE EUROPEAN COAL AND STEEL COMMUNITY IS REPEALED AND THE FOLLOWING SUBSTITUTED THEREFOR :

" ARTICLE 78

1 . THE FINANCIAL YEAR OF THE COMMUNITY SHALL RUN FROM 1 JANUARY TO 31 DECEMBER .

2 . THE ADMINISTRATIVE EXPENDITURE OF THE COMMUNITY SHALL COMPRISE THE EXPENDITURE OF THE HIGH AUTHORITY , INCLUDING THAT RELATING TO THE FUNCTIONING OF THE CONSULTATIVE COMMITTEE , AND THAT OF THE COURT , THE ASSEMBLY AND THE COUNCIL .

3 . EACH INSTITUTION OF THE COMMUNITY SHALL DRAW UP ESTIMATES OF ITS ADMINISTRATIVE EXPENDITURE . THE HIGH AUTHORITY SHALL CONSOLIDATE THESE ESTIMATES IN A PRELIMINARY DRAFT ADMINISTRATIVE BUDGET . IT SHALL ATTACH THERETO AN OPINION WHICH MAY CONTAIN DIFFERENT ESTIMATES .

THE HIGH AUTHORITY SHALL PLACE THE PRELIMINARY DRAFT BUDGET BEFORE THE COUNCIL NOT LATER THAN 30 SEPTEMBER OF THE YEAR PRECEDING THAT IN WHICH THE BUDGET IS TO BE IMPLEMENTED .

THE COUNCIL SHALL CONSULT THE HIGH AUTHORITY AND , WHERE APPROPRIATE , THE OTHER INSTITUTIONS CONCERNED WHENEVER IT INTENDS TO DEPART FROM THE PRELIMINARY DRAFT BUDGET .

4 . THE COUNCIL SHALL , ACTING BY A QUALIFIED MAJORITY , ESTABLISH THE DRAFT ADMINISTRATIVE BUDGET AND THEN FORWARD IT TO THE ASSEMBLY .

THE DRAFT ADMINISTRATIVE BUDGET SHALL BE PLACED BEFORE THE ASSEMBLY NOT LATER THAN 31 OCTOBER OF THE YEAR PRECEDING THAT IN WHICH THE BUDGET IS TO BE IMPLEMENTED .

THE ASSEMBLY SHALL HAVE THE RIGHT TO PROPOSE TO THE COUNCIL MODIFICATIONS TO THE DRAFT ADMINISTRATIVE BUDGET .

5 . IF , WITHIN ONE MONTH OF THE DRAFT ADMINISTRATIVE BUDGET BEING PLACED BEFORE IT , THE ASSEMBOLY HAS GIVEN ITS APPROVAL OR HAS NOT FORWARDED ITS OPINION TO THE COUNCIL , THE DRAFT ADMINISTRATIVE BUDGET SHALL BE DEEMED TO BE FINALLY ADOPTED .

IF WITHIN THIS PERIOD THE ASSEMBLY HAS PROPOSED MODIFICATIONS , THE DRAFT ADMINISTRATIVE BUDGET SO MODIFIED SHALL BE FORWARDED TO THE COUNCIL . THE COUNCIL SHALL DISCUSS IT WITH THE HIGH AUTHORITY AND , WHERE APPROPRIATE , WITH THE OTHER INSTITUTIONS CONCERNED , AND SHALL FINALLY ADOPT THE ADMINISTRATIVE BUDGET , ACTING BY A QUALIFIED MAJORITY .

6 . THE FINAL ADOPTION OF THE ADMINISTRATIVE BUDGET SHALL HAVE THE EFFECT OF AUTHORISING AND REQUIRING THE HIGH AUTHORITY TO COLLECT THE CORRESPONDING REVENUE IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE 49 .

ARTICLE 78A

THE ADMINISTRATIVE BUDGET SHALL BE DRAWN UP IN THE UNIT OF ACCOUNT DETERMINED IN ACCORDANCE WITH THE PROVISIONS OF THE REGULATIONS MADE PURSUANT TO ARTICLE 78F .

THE EXPENDITURE SHOWN IN THE BUDGET SHALL BE AUTHORISED FOR ONE FINANCIAL YEAR , UNLESS THE REGULATIONS MADE PURSUANT TO ARTICLE 78F PROVIDE OTHERWISE .

IN ACCORDANCE WITH CONDITIONS TO BE LAID DOWN PURSUANT TO ARTICLE 78F , ANY APPROPRIATIONS , OTHER THAN THOSE RELATING TO STAFF EXPENDITURE , THAT ARE UNEXPENDED AT THE END OF THE FINANCIAL YEAR MAY BE CARRIED FORWARD TO THE NEXT FINANCIAL YEAR ONLY .

APPROPRIATIONS SHALL BE CLASSIFIED UNDER DIFFERENT CHAPTERS GROUPING ITEMS OF EXPENDITURE ACCORDING TO THEIR NATURE OR PURPOSE AND SUBDIVIDED , AS FAR AS MAY BE NECESSARY , IN ACCORDANCE WITH THE REGULATIONS MADE PURSUANT TO ARTICLE 78F .

THE EXPENDITURE OF THE ASSEMBLY , THE COUNCIL , THE HIGH AUTHORITY AND THE COURT SHALL BE SET OUT IN SEPARATE PARTS OF THE ADMINISTRATIVE BUDGET , WITHOUT PREJUDICE TO SPECIAL ARRANGEMENTS FOR CERTAIN COMMON ITEMS OF EXPENDITURE .

ARTICLE 78B

1 . IF , AT THE BEGINNING OF A FINANCIAL YEAR , THE ADMINISTRATIVE BUDGET HAS NOT YET BEEN VOTED , A SUM EQUIVALENT TO NOT MORE THAN ONE TWELFTH OF THE BUDGET APPROPRIATIONS FOR THE PRECEDING FINANCIAL YEAR MAY BE SPENT EACH MONTH IN RESPECT OF ANY CHAPTER OR OTHER SUBDIVISION OF THE ADMINISTRATIVE BUDGET IN ACCORDANCE WITH THE PROVISIONS OF THE REGULATIONS MADE PURSUANT TO ARTICLE 78F ; THIS ARRANGEMENT SHALL NOT , HOWEVER , HAVE THE EFFECT OF PLACING AT THE DISPOSAL OF THE HIGH AUTHORITY APPROPRIATIONS IN EXCESS OF ONE-TWELFTH OF THOSE PROVIDED FOR IN THE DRAFT ADMINISTRATIVE BUDGET IN COURSE OF PREPARATION .

THE HIGH AUTHORITY IS AUTHORISED AND REQUIRED TO IMPOSE THE LEVIES UP TO THE AMOUNT OF THE APPROPRIATIONS FOR THE PRECEDING FINANCIAL YEAR , BUT SHALL NOT THEREBY EXCEED THE AMOUNT WHICH WOULD HAVE RESULTED FROM THE ADOPTION OF THE DRAFT ADMINISTRATIVE BUDGET .

2 . THE COUNCIL MAY , ACTING BY A QUALIFIED MAJORITY , PROVIDED THAT THE OTHER CONDITIONS LAID DOWN IN PARAGRAPH 1 ARE OBSERVED , AUTHORISE EXPENDITURE IN EXCESS OF ONE-TWELFTH . THE AUTHORISATION AND REQUIREMENT TO IMPOSE THE LEVIES MAY BE ADJUSTED ACCORDINGLY .

ARTICLE 78C

THE HIGH AUTHORITY SHALL IMPLEMENT THE ADMINISTRATIVE BUDGET , IN ACCORDANCE WITH THE PROVISIONS OF THE REGULATIONS MADE PURSUANT TO ARTICLE 78F , ON ITS OWN RESPONSIBILITY AND WITHIN THE LIMITS OF THE APPROPRIATIONS .

THE REGULATIONS SHALL LAY DOWN DETAILED RULES FOR EACH INSTITUTION CONCERNING ITS PART IN EFFECTING ITS OWN EXPENDITURE .

WITHIN THE ADMINISTRATIVE BUDGET , THE HIGH AUTHORITY MAY , SUBJECT TO THE LIMITS AND CONDITIONS LAID DOWN IN THE REGULATIONS MADE PURSUANT TO ARTICLE 78F , TRANSFER APPROPRIATIONS FROM ONE CHAPTER TO ANOTHER OR FROM ONE SUBDIVISION TO ANOTHER .

ARTICLE 78D

THE ACCOUNTS OF ALL THE ADMINISTRATIVE EXPENDITURE REFERRED TO IN ARTICLE 78 ( 2 ) , AND OF ADMINISTRATIVE REVENUE AND OF REVENUE DERIVED FROM THE TAX FOR THE BENEFIT OF THE COMMUNITY LEVIED ON THE SALARIES , WAGES AND EMOLUMENTS OF ITS OFFICIALS AND OTHER SERVANTS , SHALL BE EXAMINED BY AN AUDIT BOARD CONSISTING OF AUDITORS WHOSE INDEPENDENCE IS BEYOND DOUBT , ONE OF WHOM SHALL BE CHAIRMAN . THE COUNCIL SHALL , ACTING UNANIMOUSLY , DETERMINE THE NUMBER OF THE AUDITORS . THE AUDITORS AND THE CHAIRMAN OF THE AUDIT BOARD SHALL BE APPOINTED BY THE COUNCIL , ACTING UNANIMOUSLY , FOR A PERIOD OF FIVE YEARS . THEIR REMUNERATION SHALL BE DETERMINED BY THE COUNCIL , ACTING BY A QUALIFIED MAJORITY .

THE PURPOSE OF THE AUDIT , WHICH SHALL BE BASED ON RECORDS AND , IF NECESSARY , PERFORMED ON THE SPOT , SHALL BE TO ESTABLISH THAT ALL REVENUE HAS BEEN RECEIVED AND ALL EXPENDITURE INCURRED IN A LAWFUL AND REGULAR MANNER AND THAT THE FINANCIAL MANAGEMENT HAS BEEN SOUND . AFTER THE CLOSE OF EACH FINANCIAL YEAR , THE AUDIT BOARD SHALL DRAW UP A REPORT , WHICH SHALL BE ADOPTED BY A MAJORITY OF ITS MEMBERS .

THE HIGH AUTHORITY SHALL SUBMIT ANNUALLY TO THE COUNCIL AND TO THE ASSEMBLY THE ACCOUNTS OF THE PRECEDING FINANCIAL YEAR RELATING TO THE IMPLEMENTATION OF THE ADMINISTRATIVE BUDGET , TOGETHER WITH THE REPORT OF THE AUDIT BOARD . THE HIGH AUTHORITY SHALL ALSO FORWARD TO THEM A FINANCIAL STATEMENT OF THE ASSETS AND LIABILITIES OF THE COMMUNITY IN THE FIELD COVERED BY THAT BUDGET .

THE COUNCIL SHALL , ACTING BY A QUALIFIED MAJORITY , GIVE A DISCHARGE TO THE HIGH AUTHORITY IN RESPECT OF THE IMPLEMENTATION OF THE ADMINISTRATIVE BUDGET . IT SHALL COMMUNICATE ITS DECISION TO THE ASSEMBOLY .

ARTICLE 78E

THE COUNCIL SHALL APPOINT AN AUDITOR TO SERVE FOR THREE YEARS ; HE SHALL DRAW UP AN ANNUAL REPORT STATING WHETHER THE ACCOUNTING AND THE FINANCIAL MANAGEMENT OF THE HIGH AUTHORITY HAVE BEEN EFFECTED IN A REGULAR MANNER ; THIS REPORT SHALL NOT COVER ENTRIES RELATING TO THE ADMINISTRATIVE EXPENDITURE REFERRED TO IN ARTICLE 78 ( 2 ) , TO ADMINISTRATIVE REVENUE OR TO REVENUE DERIVED FROM THE TAX FOR THE BENEFIT OF THE COMMUNITY LEVIED ON THE SALARIES , WAGES AND EMOLUMENTS OF ITS OFFICIALS AND OTHER SERVANTS . HE SHALL DRAW UP THIS REPORT WITHIN SIX MONTHS OF THE CLOSE OF THE FINANCIAL YEAR TO WHICH THE ACCOUNTS REFER AND SHALL SUBMIT IT TO THE HIGH AUTHORITY AND THE COUNCIL . THE HIGH AUTHORITY SHALL FORWARD IT TO THE ASSEMBLY .

THE AUDITOR SHALL BE COMPLETELY INDEPENDENT IN THE PERFORMANCE OF HIS DUTIES . THE OFFICE OF AUDITOR SHALL BE INCOMPATIBLE WITH ANY OTHER OFFICE IN AN INSTITUTION OR DEPARTMENT OF THE COMMUNITIES OTHER THAN THAT OF MEMBER OF THE AUDIT BOARD PROVIDED FOR IN ARTICLE 78D . HIS TERM OF OFFICE SHALL BE RENEWABLE .

ARTICLE 78F

THE COUNCIL SHALL , ACTING UNANIMOUSLY ON A PROPOSAL FROM THE HIGH AUTHORITY :

( A ) MAKE FINANCIAL REGULATIONS SPECIFYING IN PARTICULAR THE PROCEDURE TO BE ADOPTED FOR ESTABLISHING AND IMPLEMENTING THE ADMINISTRATIVE BUDGET AND FOR PRESENTING AND AUDITING ACCOUNTS ;

( B ) LAY DOWN RULES CONCERNING THE RESPONSIBILITY OF AUTHORISING OFFICERS AND ACCOUNTING OFFICERS AND CONCERNING APPROPRIATE ARRANGEMENTS FOR INSPECTION . "