5. 7. 80 Official Journal of the European Communities No C 165/9 
Opinion of the Court of Auditors on the proposal for a Council Regulation on the value 
of the unit of account and the conversion rates to be applied for the purposes of the 
common agricultural policy 
— Document COM (80) 43 final — 
EXPLANATORY MEMORANDUM 
1. The expenditure of the common agricultural 
policy (refunds, interventions, storage costs, various 
premiums...) results from the grant of specific 
amounts for goods which are exported or are the 
subject of interventions or other special measures. 
Since 9 April 1979, these amounts are stated in terms 
of ECU in Community Regulations. 
The expenditure in each Member State must be in its 
national currency. For this purpose, the specific 
amounts are first converted by means of 'green rates'. 
2. The expenditure thus incurred in national 
currencies may only be entered in the Community 
budget in budgetary units of account. At present, the 
unit employed is the EUA, but shortly it will be the 
ECU. 
The conversion of this expenditure is made by using 
budgetary rates (rate at 20th of each month). 
3. The two operations above will necessarily result 
in an accounting difference between the two calcu­
lations in ECU and EUA whenever the green rates 
and the budgetary rates themselves are different. 
Thus, export to a non-member country by the Federal 
Republic of Germany of 1 000 tonnes of a milk 
product for which the refund is set at 100 ECU/ 
tonne gives rise to theoretical Community 
expenditure of 100 000 ECU ('). by the budgetary rate (1 ECU = 2-51185 DM on 20 
March 1980), i.e. 281 430 : 2-51185 - 112 400 ECU. 
4. If the two amounts are compared, there is a 
difference of 12 040 ECU — the 'dual rate effect'. 
This is an item of extra expenditure for the 
Community budget which takes the form of an 
accounting correction subsequent to the transaction. 
5. For the financial years 1977 and 1978, the 
Commission decided to present this dual rate 
expenditure as a separate item. Since 1979 the dual 
rate heading has been deleted and there is no way of 
knowing the volume of this expenditure, which 
nevertheless subsists. 
The proposal under consideration contains no 
provision for entering exchange rate differences 
separately in the budget and accounts. Since the 
system of special agricultural conversion rates, 
different from the budgetary rates defined in the 
proposed Council Regulation on the application of 
the ECU to the general budget of the Communities, 
has been retained, however, it is still desirable to 
identify the expenditure attributable to the existence 
of this dual rate system. 
The system remains a source of additional 
expenditure (1 154 MEUA in 1978) which, even if it 
is bound to decline justifies separate presentation in 
the Revenue as well as in the Expenditure part of the 
general budget. 
In practice, as payment is to be made in DM, the 
refund has first to be converted in DM by using 
the green rate (1 ECU - 2-81432 DM, for 
milk products in March 1980), i.e. 
100 x 2-81432 - 281-43 DM/tonne, before calcu­
lating the actual expenditure in DM, i.e. 
281-43 x 1 000 = 281 430 DM. 
This item of expenditure will be charged up as a 
payment in the Community accounts after conversion 
(') For the purposes of simplification, this example does not 
take into account the monetary compensatory amount to 
be granted nor the coefficient to be applied to the 
refunds in the case in question. THE COURT OF AUDITORS OF THE EUROPEAN 
COMMUNITIES, 
Having regard to the Treaty esablishing the European 
Economic Community, and in particular Articles 39 
and 43 thereof, 
Having regard to the Financial Regulation of 
21 December 1977, and in particular Article 10 
thereof, 
Having regard to Council Regulation (EEC) 
No 652/79 of 29 March 1979, 
No C 165/10 Official Journal of the European Communities 5.7.80 
Having regard to the proposal in document COM 
(80) 43 final for a Council Regulation on the value of 
the unit of account and the conversion rates to be 
applied for the purposes of the common agricultural 
policy referred to the Court for its opinion by a letter 
from the Council of 26 February 1980, 
Whereas the management of the common agricultural 
policy is based upon a number of specific monetary 
devices employing, in particular, special conversion 
rates, whereas these rates are used for conversion of 
the amounts specified in the legal instruments relating 
to the common agricultural policy; 
Whereas the financial instrument for implementing 
the common agricultural policy is the EAGGF which, 
according to Article 1 of Regulation (EEC) No 
729/70 of 21 April 1970, forms a part of the budget 
of the Communities; 
Whereas the proposed Council Regulation amending 
for the third time the Financial Regulation of 
21 December 1977 as regards the use of the ECU in 
the general budget of the European Communities, 
which was the subject of an opinion of the Court of 
Auditors of 12 March 1980, will replace the 
European unit of account applicable to the budget of 
the Communities by the ECU; whereas conversion 
between the ECU and the national currencies is 
effected at the daily rate published in the Official 
Journal of the European Communities; 
Whereas from the consecutive application of these 
rates (agricultural conversion rate for calculating in 
national currencies the amounts to be paid to the 
individual recipient or collected from the individual 
debtor, budgetary rate for the conversion of receipts 
or expenditure in the Member States into Community 
budgetary operations expressed in ECU) there result 
exchange differences which are a charge upon, or to the profit of, the Community budget; whereas precise 
rules should be formulated for the presentation of 
these exchange differences in the budget and in the 
accounts; 
Whereas the concept of effective date in Title 2 of the 
draft Regulation must, since it applies to customs 
formalities on import and export, be adapted to the 
provisions in Council Directive 79/623/EEC of 
25 June 1979 on the harmonization of provisions laid 
down by law, regulation or administrative action 
relating to customs debt ('), 
IS OF THE OPINION: 
1. that an Article 3a should be added to Title 1 of the 
proposed Regulation, worded as follows: 
'Article 3a 
The net exchange differences arising from the use 
of: 
— the agricultural conversion rate for the 
conversion into national currencies of amounts 
expressed in ECU in legal instruments relating 
to the common agricultural policy, 
— the budgetary rate for the conversion into 
ECU and entry in the accounts of expenditure 
incurred in national currencies in the various 
Member States.' 
should be entered separately, in the Revenue and 
the Expenditure parts of the general budget. 
2. that Article 5 (1) (a) of Title 2 of the proposed 
Regulation should be amended to take account of 
the moment to be taken into consideration for the 
determination of the amount of the customs debt, 
referred to in Council Directive 79/623/EEC of 
25 June 1979. 
(') OJ No L 179, 17.7. 1979, p. 31.