EUROPEAN COMMISSION Brussels, 31.7.2015 SWD(2015) 155 final COMMISSION STAFF WORKING DOCUMENT Methodology regarding the statistical evaluation of reported irregularities for 2014 Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Protection of the European Union's financial interests - Fight against Fraud

Annual Report 2014 {COM(2015) 386 final}

{SWD(2015) 151 final}

{SWD(2015) 152 final}

{SWD(2015) 153 final}

{SWD(2015) 154 final}

{SWD(2015) 156 final}



TABLE OF CONTENTS COMMISSION STAFF WORKING DOCUMENT Methodology regarding the statistical evaluation of reported irregularities for 2014 1.INTRODUCTION3 1.1.The legal framework for irregularities reporting4 1.2.Expenditure – contents of the reporting obligation and derogations5 1.2.1.The reporting obligation5 1.2.2.Derogations to the reporting obligation6 1.3.Revenue – Traditional Own Resources6 1.3.1.Monitoring of establishment and recovery TOR7 1.3.1.1.Procedure for managing Member States’ reports for write-off7 1.3.2.Commission’s inspection8 1.3.3.Particular cases of Member State failure to recover TOR8 1.3.4.Detection of fraud and irregularities8 1.3.5.Categorisation of cases by amounts involved8 1.3.6.Recovery9 2.DEFINITIONS10 2.1.Legal definitions10 2.1.1.Irregularity10 2.1.2.Fraud10

2.1.3.Suspected fraud11 2.2.Definitions applied in the analysis11 2.3.Indicators11 2.3.1.Fraud Detection Rate and Irregularity Detection Rate11 2.3.2.Fraud Frequency and Fraud Amounts Levels12 2.3.3.Detection Efficiency12 2.3.4.Reporting Efficiency13 2.3.5.Ratio of Established Fraud13 2.3.6.Error Rate14 2.4.Assumptions and hypothesis14 1.INTRODUCTION This commission staff working document accompanies the Annual Report from the Commission to the Parliament and the Council on the protection of the European Union’s financial interests and the fight against fraud (further referred to it as ‘Report’), adopted on the basis of article 325 of the Treaty on the Functioning of the European Union (TFEU). This document describes the main information sources on which the Report is based, the legal framework which foresees the obligation to submit them to the Commission and the methodology followed regarding the statistical evaluation of irregularities reported as fraudulent and other irregularities, in the areas where Member States implement the EU budget (expenditures for natural resources, cohesion policy and pre-accession funds), regarding the collection of the EU’s traditional own resources, as well as in the area of expenditure managed directly by the Commission. EU legislation requires Member States to report to the Commission, on a quarterly basis, irregularities that have been detected in the areas of shared management and Traditional Own Resources. Member States must inform the Commission whether the reported irregularities constitute suspicions of fraud (if they give rise to the initiation of administrative and/or judicial proceedings at national level in order to establish the presence of intentional behaviour, such as fraud) and must update the reported information in relation to the completion of the relevant proceedings for the imposition of sanctions. Regarding expenditure managed directly by the Commission, it is the Commission services that have to qualify the recoveries and whether they encountered errors, irregularities or suspected fraud. In relation to recoveries, preventive and corrective measures for the protection of the EU's financial interests, the analysis presented in the Report is limited to the information published in the EU's annual accounts. For this reason it mainly concerns interruptions, suspensions and financial corrections by the Commission vis-à-vis Member States, although, it also presents information concerning recoveries made. Data sources There are three main data sources used for the analyses in the Report: (1)Irregularities reported by Member States under a specific legal obligation. These are described in detail in paragraph 1.1 to 1.3. Irregularities related to expenditure areas of the budget are reported via an IT tool known as the Irregularity Management System (IMS), managed and maintained by OLAF. Irregularities concerning Traditional Own Resources (TOR) are reported via an IT system known as OWNRES and managed and maintained by DG BUDG.

(2)Recovery orders recorded in the Commission's Accrual Based Accounting System (ABAC). Authorising Officers by Delegation specify whether a given recovery order is linked to an irregularity, a case of potential fraud (defined as 'OLAF notified') or other. (3)Annual Reports published by competent DGs in relation to expenditure and the Provisional Accounts of the EU published by DG BUDG, in particular in relation to preventive and corrective measures (interruptions and suspensions of payments, financial corrections and recoveries). 1.1.The legal framework for irregularity reporting European legislation provides for the protection of the Union’s financial interests in all areas of activity. The Financial Regulation sets the principles and rules for the correct implementation of the budget. Member States are required to report to the European Commission (EC) evidence of fraud and other irregularities. This need is particularly evident in those sectors of the EU budget where the main responsibility for management is with the Member States, namely, in the field of Agriculture and Cohesion Policy (on the expenditure side) and Own Resources (on the revenue side). In these areas, Member States must inform the Commission about all irregularities involving more than EUR 10 000 of EU finances. This applies at all stages in the procedure for recovering monies unduly paid or not received. Regulation No 1150/2000 specifies the requirement for own resources and Regulation No 1848/2006 specifies for the agriculture sector. For the Cohesion Policy, which runs over multi-annual programmes, the legal framework is more complex and is covered by Regulations Nos 1681/94 and 1831/94 for the programming periods until the 2000-2006 and by Regulation No 1828/2006 for the period 2007-2013. Regulation No 498/2007 covers the European Fishery Fund (EFF). The obligation to report irregularities in the area of pre-accession assistance is established in the Financing Agreements/Memoranda signed between the acceding countries, Candidate countries and the European Community/Union and is in accordance with the provisions of Commission Regulation (EC) 1681/1994 and 1828/2006. This obligation is enhanced by the Commission decision granting conferral of management on extended decentralised basis (EDIS). 1.2.Expenditure – the reporting obligation and derogations 1.2.1.The reporting obligation Member States shall report to the EC any irregularities which have been the subject of a primary administrative or judicial finding, within two months, following the end of each quarter. Therefore, the reporting period is divided in four quarters, the last of which has as deadline of the end of February of the following year. The first communication of an irregularity is also known as ‘Initial Communication’ The information to be submitted constitutes, among others: (1)The identification of the operation or budget line (for agriculture) affected by the irregularity; (2)The detection method and the modus operandi; (3)The financial impact of the irregularity; (4)The natural and legal persons having committed the irregularity. Member States may give further information when updating the communication, which they do not dispose at the moment of the initial communication. Updating communications provides relevant information about the administrative and judicial follow-up of the irregularities. In the areas of Cohesion and Pre-Accession information about the financial follow-up has to be provided for irregularities of previous programming periods (until 2000-2006 included). The reporting of irregularities happens by electronic means, using the modules provided by the EC (see chapter 4 of this document about the electronic reporting systems). In certain sectors, namely Cohesion Policy and Pre-accession, financial information has to be expressed in Euro by countries which have not adopted it as their currency. 1.2.2.Derogations to the reporting obligation

As a general rule, where irregularities concern amounts less than EUR 10 000 chargeable to the general budget of the EU, Member States shall not send the irregularity communication to the EC, unless the Commission expressly requests it. Further specific derogations to the reporting obligation exist for Agriculture, Cohesion and Pre-accession policies. More concretely, cases should not be reported: –where the irregularity consists solely of the failure to partially or totally execute a (co-)financed operation owing to the bankruptcy of the final beneficiary or the final recipient; however, irregularities preceding a bankruptcy and cases of suspected fraud must be reported –if the case has already been brought to the attention of the administrative authority by the final beneficiary or the final recipient voluntarily and before detection by the relevant authority, whether before or after the payment of the public contribution –where the administrative authority finds a mistake regarding the eligibility of the financed expenditure and corrects the mistake prior to payment of the public contribution. 1.3.Revenue – Traditional Own Resources Traditional own resources (TOR) mainly consist of customs duties that are charged on imports of products coming from a non-EU state, and sugar levies. Member States are responsible for making traditional own resources available to the Commission within the deadlines set by Regulation No 1150/2000. Established amounts of TOR, that have been recovered or that are guaranteed and not under appeal, are to be made available via the A-account. Member States retain 25 % a portion of the collected amounts as collection costs. However, if TOR have been established by a Member State but not yet been recovered and if no security has been provided or the secured amount has been disputed, Member States may enter these TOR amounts in the B-account. These amounts of TOR are not made available until they are actually recovered. Most fraud and irregularity cases relate to B-account items. Regarding Member States’ TOR recovery activity, it is important to keep in mind that most of established TOR are recovered without any particular difficulties. These amounts are entered in the A-account and made available to the EU budget. This covers most of the ‘normal’ import flows, where release for free circulation gives rise to a customs debt. The remaining exceptional items are entered in the B account. Under Article 6(5) of the Regulation No 1150/2000, Member States are required to communicate to the Commission, via the OWNRES system, cases of fraud and irregularity, if the TOR amount exceeds EUR 10 000. The OWNRES database is a key tool for obtaining data for global analyses of fraud and irregularities, and provides valuable information for the Budgetary Authority. Given the Budgetary Authority’s particular interest in recovery, reliable information must be entered in OWNRES regarding the number of cases of fraud and irregularities, and their development. Member States have a special responsibility to ensure that appropriate statistical information on fraud and irregularities is provided to the Commission. 1.3.1.Monitoring of the establishment and recovery of TOR In its capacity as Authorising Officer responsible for executing the EU budget, the Commission (DG Budget as delegated Authorising Officer) monitors the establishment and recovery of TOR by Member States in various ways. The monitoring is carried out in partnership with different Commission departments, including OLAF. The following three methods are used: (1)Overall monitoring of recovery of TOR via the write-off procedure, as provided for in Article 17(2) of Regulation No 1150/2000 (2)Regular inspection in Member States of the establishment and recovery of TOR and B-account entries, as provided for in Article 18 of Regulation No 1150/2000 (3)Specific monitoring (in close cooperation with European Anti-Fraud Office (OLAF), the Directorate-General for Taxation and Customs Union (TAXUD) and the Directorate-General for Agriculture and Rural Development (AGRI)) of Member States’ follow-up of recovery in individual cases, which have a significant financial impact and which may involve Mutual Administrative Assistance. 1.3.1.1.Procedure for managing Member States’ reports for write-off Member States must take all requisite measures to ensure that established amounts of TOR are made available to the Commission. This requirement, mentioned in Article 17(1) of Regulation No 1150/2000, also implies that a Member State is only released from its obligation to make available TOR if it can prove that the debt is irrecoverable either: (1)for reasons of force majeure; (2)or for other reasons, which cannot be attributed to that Member State. There are two ways to conclude that amounts of TOR have become irrecoverable. The first is by decision of a Member State declaring that they cannot be recovered — this declaration may be made at any time. However, TOR must be deemed irrecoverable by a Member State five years at the latest from the date on which the debt was established, or in the event of an administrative or judicial appeal, the final decision was given, or the last part-payment to the debt was made, whichever is later. If the amount of the written-off debt is less than EUR 50 000, Member States do not have to communicate the case to the Commission, unless the Commission makes a specific request. However, if the irrecoverable amount of TOR exceeds EUR 50 000, the write-off must be reported to the Commission, which has to decide whether the necessary conditions are fulfilled in order to release the Member State from the obligation to make the TOR available.

Member States submit their request to be released from the obligation to make the TOR available directly via an application called WOMIS 1.3.2.Commission’s inspection The Commission regularly carries out inspections in Member States of the establishment and recovery of TOR and B-account entries, as provided for in Article 18 of Regulation No 1150/2000. A report on the operation of the inspection arrangements for the traditional own resources system is produced every three years and sent to the Budgetary Authority. Also, the Commission services annually draft a thematic report based on the outcome of the Commissions’ inspections, which is regularly discussed with Member States. 1.3.3.Particular cases of Member State failure to recover TOR If TOR are not established because of an administrative error by a Member State, the Commission applies the principle of financial liability. The main objective of these procedures is to encourage individual Member States to improve their administrative performance and to address weaknesses leading to the loss of TOR. Payments for these cases are made available via the A-account and they reduce, in effect, the contribution of the Member States via GNI resources, in proportion to their contribution to the EU budget. 1.3.4.Detection of fraud and irregularities Cases should be included in OWNRES upon the initial discovery of the irregularity or fraud or the establishment of the duties. As a result, the year of the customs operation and the year of discovery of the irregularity or fraud can diverge. Member States must indicate the year and the quarter when the OWNRES case was first discovered or when the duties were established. Member States are constantly adding new cases and updating existing cases related to previous years. So the information generated by OWNRES represents the situation on the date of the query (cut-off date). For this report the query was carried out on 8 April 2015. The distinction in OWNRES between fraud and irregularity might not be fully comparable between different Member States. In their reports Member States make this distinction usually on subjective grounds and before any court judgment is given. Such subjective grounds vary between national administrations depending on their national practises and legislation. The concepts of suspected/established fraud or irregularity reported as fraudulent/non-fraudulent are not used in the OWNRES system. It should also be noted that a classification of a cases as fraud or an irregularity case is not static in OWNRES and can be changed by the Member State at any time in the course of the national process. Only when a case is closed in the OWNRES system does it obtain its final classification as case of fraud or irregularity. 1.3.5.Established and estimated amounts In the report, two monetary values are used to express the financial impact of cases of fraud and irregularities. The established amount indicates the total amount that national authorities have established after all subsequent corrections have been processed. In this way, all changes to the established amounts are taken into account in this report. In order to give an accurate view of Member States’ efforts to combat fraud and irregularities, the estimated amounts are also used in the analysis, to take into account the cases where no establishment has yet been made, or, will not be made because of the seizure or confiscation of the imported goods. 1.3.6.Categorisation of cases by amounts involved In the field of TOR, a picture of the Member States’ activities regarding establishment and recovery actions can be given by separating cases of fraud and irregularities into categories based on the established amounts. Two categories of amounts — amounts below EUR 50 .000 and amounts above 50 000 — serve as a basis for the analysis hereafter and gives a deeper insight into Member States’ activities regarding the detection of cases of fraud and irregularities. 1.3.7.Recovery The recovery rate (RR) represents the percentage of the total amount recovered from debtors in relation to the total established amount. The amounts for which Member States have been considered financially liable because of weaknesses observed in their recovery action are, thus, not taken into account. This recovery rate is a snapshot of the recovery situation at the moment of the query. The historical recovery rate (HRR) takes into account cases which are registered in OWNRES as closed cases. Cases of seized and confiscated goods (usually cigarettes) for which no recovery is required are excluded. The HRR rate expresses the recovery result in both complex and simple cases. Therefore, established and closed cases from 2010 onwards are excluded, because these are predominantly simple cases, as complex cases generally cannot be closed within 3 years. 2.DEFINITIONS For the purposes of this document, two sets of definitions are used. The first set refers to legal definitions, the second to specific indicators used throughout the different chapters.

2.1.Legal definitions 2.1.1.Irregularity Irregularity: means any infringement of a provision of European law resulting from an act or omission by an economic operator which has, or would have, the effect of prejudicing the general budget of the European Union or budgets managed by it, either by reducing or losing revenue accruing from own resources collected directly on behalf of the Union, or by an unjustified item of expenditure. 2.1.2.Fraud Fraud: affecting the European Communities' financial interests shall consist of: a) in respect of expenditure, any intentional act or omission relating to: –the use or presentation of false, incorrect or incomplete statements or documents, which has as its effect the misappropriation or wrongful retention of funds from the general budget of the European Communities or budgets managed by, or on behalf of, the European Communities; –non-disclosure of information in violation of a specific obligation, with the same effect; –the misapplication of such funds for purposes other than those for which they were originally granted; b) in respect of revenue, any intentional act or omission relating to: –the use or presentation of false, incorrect or incomplete statements or documents, which has as its effect the illegal diminution of the resources of the general budget of the European Communities or budgets managed by, or on behalf of, the European Communities; –non-disclosure of information in violation of a specific obligation, with the same effect; –misapplication of a legally obtained benefit, with the same effect. National legislation contains several provisions that describe the conduct and the related penalties and sanctions. Some of these provisions are the result of the implementation of the PIF Convention into national legal systems. The two definitions indicated above seem similar as both refer to 'acts or omissions'. In fact, the concept of irregularity is much wider than that of fraud. Fraud explicitly refers to 'intentional' act or omission. In this respect, the concept of irregularity includes that of fraud, but refers also to a whole series of infringements of rules which do not imply a deliberate intent to violate or for which such intent is not clear (for instance a breach of rules due to the misinterpretation of certain provisions because of their complexity). Therefore, the distinction between irregularities and fraud is that fraud is a criminal act that can only be determined by the outcome of judicial proceedings. As such, it is only when the judicial procedure has come to an end that the actual amount of fraud can be determined. While awaiting these results, the Commission works on the basis of the information supplied by Member States concerning cases of irregularities, some of which, in the opinion of the reporting Member States, give rise to suspicions of fraud. The Commission's statistical assessment of, and ability to respond to, irregularities are influenced by the accuracy and timeliness of the notifications made by the Member States. 2.1.3.Suspected fraud Suspected fraud: means an irregularity giving rise to the initiation of administrative and/or judicial proceedings at national level in order to establish the presence of intentional behaviour, in particular fraud, such as is referred to in Article 1(1), point (a), of the PIF Convention. In their communications of irregularity to the Commission, Member States have been asked to indicate whether a reported irregularity can be regarded as 'suspected fraud'. This was introduced in order to provide some data for statistical purposes and to avoid the need to wait until the end of criminal procedures for a final indictment. 2.2.Definitions applied in the analysis

However, it is to be noted that for greater clarity, only two broad categories of irregularity are applied in the analysis and in the indicators: 'Irregularities reported as fraudulent' are those irregularities for which the fraudulent nature is suspected or established, it also includes those irregularities which Member States have not reported as fraudulent, but for which they indicate that a criminal proceeding has been initiated. 'Irregularities not reported as fraudulent' are any other type of reported irregularities, for which the fraudulent nature has not been ascertained. 2.3.Indicators 2.3.1.Fraud Detection Rate and Irregularity Detection Rate The Fraud Detection Rate (FDR) can be calculated either on the basis of total expenditure or the relative expenditure. Relative expenditure means that for the calculation, only payments above EUR 10,000, if available, are taken into account. This is the case in the area of shared management, where the same threshold is applied for the reporting. For centralised management, where there is no threshold for the reporting of irregularities, total expenditure is used. With the latter, the calculation of the Fraud Detection Rate becomes more accurate. In the same way, the Irregularity Rate can also be calculated on the basis of either total expenditure or relative expenditure. Both the FDR and IDR can be calculated by financial year (as in the case of the Agriculture sector and Direct Management) or on the entire Programming Period (as in the case of Structural Funds) and by Member State. The FDR is calculated using amounts linked to cases of irregularities reported as fraudulent. 2.3.2.Fraud Frequency Level and Fraud Amounts Level The Fraud Frequency Level (FFL) represents the percentage of cases qualified as suspected fraud and established fraud in relation to the total number of reported irregularities, and is calculated using Equation 4 below. The Fraud Amounts Level (FAL) represents the percentage of financial amounts involved in cases qualified as suspected fraud and established fraud in realtion to the total reported financial amounts affected by irregularities and it is calculated using Equation 5 below.

FFL and FAL can be calculated by financial year (as in the case of the Agriculture sector) or on an entire Programming Period (as in the case of Structural Funds) and by Member State. 2.3.3.Detection Efficiency This is a new concept to measure how quickly an irregularity is discovered. It calculates the time between the date of committing the irregularity and the date of its detection. The Detection Efficiency (DetE) is calculated in months, derived from the number of days between the date upon which the irregularity was initiated (as communicated by the competent authority) and the date of the primary administrative or judicial finding (PACA) divided by 30 as showed in Equation 5 below. The average Detection Efficiency (DetE) can be calculated per country and/or per sector according to Equation 6 below. Only irregularities containing the necessary information are used to calculate the average. 2.3.4.Reporting Efficiency This is a new concept to measure how quickly an irregularity is reported after its discovery. It calculates the time between the date of the PACA and the date of its reporting to the Commission. The Reporting Efficiency (RepE) is calculated in months derived from the number of days between the date of (PACA) and the date of the initial communication of the irregularity to the Commission, divided by 30 as showed in Equation 7 below. The average Reporting Efficiency (RepE) can be calculated per country and/or per sector according to Equation 6 below. Only irregularities containing the necessary information are used to calculate the average.

2.3.5.Ratio of Established Fraud The Ratio of Established Fraud (REF) is a new concept and allows to determine, on a given period of time (five years in the present report: 2008-2012) the percentage of irregularities reported as fraudulent for which fraud has been effectively established. It is calculated by dividing the number of cases for which Member States indicated that fraud was establised by the total number of irregularities reported as fraudulent, as showed in Equation 9 below. It can be calculated by Member State or at EU level and by sector. 2.3.6.Error Rate The Residual Error Rate (RER) indicates the risk of error which remains after the responsible authority has performed all of its controls (administrative and on-the-spot) and has corrected the errors detected. It is an extrapolation of the error rate resulting from the population checked on-the-spot, where available, in relation to the entire population. However, the precise methodology may differ from sector to sector. This extrapolation is estimated by the Audit Authorities and is revised by the competent Commission services. Data published in the Commission Staff Working Document 'Statistical evaluation of irregularities' are extracted from the Annual Activity Reports of the Directorates General of the Commisssion responsible for the different areas of shared management. 2.4.Assumptions and hypothesis It has been affirmed that the IMS system is now fully deployed and the data quality is sufficient. The irregularity reporting of countries has been improving over the years, therefore, it can be said that reporting (both technically and in substance) cannot be the reason for non-communication of irregularities, or the relatively low number of irregularities, compared with the EU funding recieved. As a consequence, a renewed methodology regarding the analysis of the irregularities was developed in relation to the expenditure part of the 'Statistical evaluation of irregularities' staff working document. The renewed methodology is based on the assumption that the reporting effort equals the detection effort of a country. This suggests that the number of irregular cases reported by a country (especially irregularities of fraudulent nature), will be interpreted as the level of its detection capabilities. There are 4 hypothesis that derive from this basic assumption, especially when no irregular cases (or too few) are reported by a country: –H1) There is zero fraud happening in the country –H2) The country is unable to detect fraud –H3) The country is unwilling to detect fraud –H4) A combination of H2) and H3) Subsequently, the renewed methodology provides for revised indicators to measure the reporting of irregularities from the point of view of the detection effort.



3.READING GUIDE 3.1.A reading guide to the Country Factsheet The Commission Staff Commission Document “Statistical evaluation of irregularities reported for 2014 – Own Resources, Natural Resources, Cohesion Policy, Pre-accession and Direct expenditure” contains 28 factsheets summarising for each Member State some of the elements highlighted in the analyses developed in the various chapters of the document.

This reading guide is meant to help you understanding the data and indicators captured in the factsheet. 3.2.The factsheet Each factsheet is divided in four sections clearly identified by different colours, which correspond to a specific subject (red for own resources, green for natural resources, blue for Cohesion policy and purple for the financial corrections implemented by the Commission vis-à-vis the Member States in relation to share management areas. 3.2.1.Traditional own resources The table above lists for each Member State: A.The number of cases of irregularities reported as fraudulent in 2014; B.The established and estimated amounts related to cases under A; C.The number of cases of irregularities not reported as fraudulent in 2014; D.The established and estimated amounts related to cases under C; E.The percentage that B+D represent on the total TOR collected by the Member State 3.2.2.Natural resources 3.2.2.1.Financial and audit information The table above indicates: A.Detailed by Fund, and in the case of EAGF also by intervention measures, the total amount of expenditure expressed in EUR for 2014 as showed in the Annual Activity Reports of the competent Commission services (DG AGRI and DG MARE); B.Detailed by Fund, and in the case of EAGF also by intervention measures, the ‘adjusted error rate’ (expressed as % of the expenditure) for 2014 expenditure as showed in the Annual Activity Reports of the competent Commission services (DG AGRI and DG MARE); C.Detailed by Fund, and in the case of EAGF also by intervention measures, the ‘residual amount at risk’ (expressed in EUR) for 2014 as showed in the Annual Activity Reports of the competent Commission services (DG AGRI and DG MARE). The term ‘Residual’ is indicated in brackets as it is specific to DG AGRI methodology to calculate the amount at risk, which takes into account the corrective capacity of the systems. 3.2.2.2.Data about reported irregularities

The table above contains the following information: D.The number of cases of irregularities reported as fraudulent in 2014; E.The financial amounts related to cases under D; F.The number of cases of irregularities not reported as fraudulent in 2014; G.The financial amounts related to cases under F; H.The Fraud Detection Rate (FDR), as defined in paragraph 2.3.1; I.The Irregularity Detection Rate (IDR), as defined in paragraph 2.3.1. 3.2.2.3.Anti-fraud activities indicators The data used to calculate the values showed in the table come from the irregularities reported as fraudulent between 2010 and 2014. The table above contains the following information: J.Detection efficiency, as defined in paragraph 2.3.3, expressed in average months; K.Reporting efficiency, as defined in paragraph 2.3.4, expressed in average months; L.Detection + Reporting efficiency is the sum of the values indicated under J. and K. The data used to calculate the values showed in the table come from the irregularities reported as fraudulent between 2010 and 2014. The table above contains the following information: M.Number of cases of suspected fraud reported in the reference period; N.Number of cases of established fraud reported in the reference period; O.Sum of values of M and N. P.Ratio of established fraud (REF) calculated as indicated in paragraph 2.3.5. 3.2.3.Cohesion policy

Data and information presented in this section refer exclusively to the programming period 2007-13. 3.2.3.1.Financial and audit data The table above indicates: A.Detailed by Fund (the table also includes data for the Cohesion Fund, whenever relevant), the total amount committed for 2014; B.Detailed by Fund (the table also includes data for the Cohesion Fund, whenever relevant), the total amount paid in 2014; C.Detailed by Fund (the table also includes data for the Cohesion Fund, whenever relevant), the total amount committed until the end of 2014 in relation to the programming period 2007-14; D.Detailed by Fund (the table also includes data for the Cohesion Fund, whenever relevant), the total amount paid until the end of 2014 in relation to the programming period 2007-14; E.The ‘average risk rate’ for the 2014 expenditure as showed in the Annual Activity Reports 2014 of DG REGIO and DG MARE; F.The ‘cumulative residual risk’ for the 2007-13 related expenditure as showed in the Annual Activity Reports 2014 of DG REGIO and DG MARE. 3.2.3.2.Data about reported irregularities G.The number of cases of irregularities reported as fraudulent in 2014 and cumulatively for the whole period 2007-13; H.The financial amounts related to cases under D; I.The number of cases of irregularities not reported as fraudulent in 2014 and cumulatively for the whole period 2007-13; J.The financial amounts related to cases under F; K.The Fraud Detection Rate (FDR), as defined in paragraph 2.3.1; L.The Irregularity Detection Rate (IDR), as defined in paragraph 2.3.1. 3.2.3.3.Anti-fraud activities indicators