Report

on the financial statements of the European Foundation for the Improvement of Living and Working Conditions (Dublin Foundation) for the financial year ended 31 December 1998, together with the Foundation's replies

(1999/C 372/07)

CONTENTS

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Opinion of the Court

1. This report is addressed to the Council and the European Parliament in accordance with Article 16 of Regulation (EEC) No 1365/75(1), as amended by Article 1(4) of Regulation (EEC) No 1947/93(2).

2. The Court has examined the financial statements of the European Foundation for the Improvement of Living and Working Conditions for the financial year ended 31 December 1998. In accordance with Article 1(16) of Council Regulation (EEC) No 1949/93(3) amending Regulation (EEC) No 1417/76(4), the budget was implemented under the responsibility of the Administrative Board. This responsibility included the drawing up and presentation of the financial statements(5) in accordance with the internal financial provisions provided for under Article 1(52), (54) and (55) of Council Regulation (EEC) No 1949/93 amending Regulation (EEC) No 1417/76. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts.

3. The Court undertook its audit in accordance with its audit policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific characteristics of the Community context. Accordingly, the Court carried out such tests of the accounting records and other procedures as it deemed necessary in the circumstances. Through the audit, the Court obtained a reasonable basis for the opinion expressed below.

4. This examination has allowed the Court to obtain reasonable assurance that the accounts for financial year ended 31 December 1998 are reliable and that the underlying transactions are, taken as a whole, legal and regular.

Main observations concerning the implementation of the budget of the European Foundation for the Improvement of Living and Working Conditions (Dublin Foundation) for the financial year ended 31 December 1998

Administration

Implementation of the Financial Regulation

5. The present version of the "implementation of the Financial Regulation" dates from 1976 and is in need of revision to reflect current practice and developments in accounting. The Foundation should update the implementing provisions to take account of recent developments in the use of information technology and the introduction of the euro. The implementing provisions also need to address: entries in the inventory, regulations concerning an Advisory Committee on Procurements and Contracts (ACPC), delegation of powers and management of the imprest accounts.

Imprest account

6. Expenditure through the imprest account amounted to 37 % of total expenditure, salaries excluded. To assist management and control of the imprest account, additional explanatory information could be provided by the imprest holder. As soon as the new SI 2 budgetary system is installed, only a small number of transactions should be processed via the imprest account.

Balance sheet

Sundry expenditure to be charged

7. The balance on the sundry expenditure account as at 31 December 1998 amounted to ECU 38875. This comprises two parts: an amount of ECU 37611 brought forward in the balance sheet for the financial year 1997, and ECU 1264 relating to 1998. The balance brought forward relates to amounts paid in 1997 when there were insufficient funds in the budget line. The amounts were charged to a suspense account in the balance sheet to be regularised in 1998: that is to be approved by the Financial Controller and charged against the correct budget line. The amounts were not regularised in 1998. The amount relating to 1998 refers to similar payments made during this year. The total amount on this balance sheet item should be regularised in 1999.

Translation section

8. With regard to the development of the Translation Centre for bodies of the European Union in Luxembourg, the situation of the translation section in the Foundation should be reviewed.

Missions

9. To assist the management of mission expenses, mission statistics should be prepared in a way which makes it possible to allocate the cost per head, and per unit.

10. Mission expenses of experts should, as a rule, be paid to their institution. If they are paid to the expert, original travel tickets and boarding cards should be stamped "paid by the European Foundation..." before being copied as annex to the expenses form.

This report was adopted by the Court of Auditors in Luxembourg at its meeting of 9 September 1999.

For the Court of Auditors

Jan O. KARLSSON

President

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

(2) OJ L 181, 23.7.1993, p. 13.

(3) OJ L 181, 23.7.1993, p. 26.

(4) OJ L 164, 24.6.1976, p. 1.

(5) As required under Article 16 of Council Regulation (EEC) No 1365/75 as amended by Regulation (EEC) No 1947/93, the accounts for all the Foundation's revenue and expenditure in respect of the financial year 1998 were drawn up on 26 March 1999 and forwarded to the Commission, the Foundation's Management Board and the Court of Auditors. These accounts were received by the Court on 21 May 1999, a summarised version of these financial statements is presented in the tables attached to this report.

Table 1

Balance sheet as at 31 December 1998 and 1997

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Table 2

Revenue and expenditure account for the financial years 1998 and 1997

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DUBLIN FOUNDATION'S REPLIES

Implementation of the Financial Regulation

5. Arrangements have been made for the up-dating of the implementing rules for the Financial Regulation. The revised version will incorporate the issues addressed by the Court.

Imprest account

6. Additional explanatory information will in the future be provided in relation to expenditure from the imprest account.

Balance sheet

Sundry expenditure to be charged

7. The amounts in the balance sheet for the year 1998 referred to by the Court have now been regularised. The Foundation has taken appropriate measures to prevent a recurrence of this problem.

Translation section

8. A review of the language and translation services of the Foundation is in hand.

Missions

9. The Foundation will re-examine its method of preparing mission statistics in order to determine how best to address the recommendation of the Court, having regard to the limited staff resources available.

10. Travel tickets and boarding cards are now stamped "paid by the European Foundation".