Report on the financial statements of the European Monitoring Centre on Racism and Xenophobia (Vienna) (Period from 1 May to 31 December 1998), together with the Centre's replies
Date: 1999-10-07
Institutions: European Court of Auditors
Subjects: Community body, financial control, financial year, management audit, racism, report

C 372/50

EN

Official Journal of the European Communities

22.12.1999

on the financial statements of the European Monitoring Centre on Racism and Xenophobia
(Vienna) (Period from 1 May to 31 December 1998), together with the Centre(cid:146)s replies

REPORT

(1999/C 372/09)

CONTENTS

Paragraph
reference

OPINION OF THE COURT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1-4

MAIN OBSERVATIONS CONCERNING THE IMPLEMENTATION OF THE BUDGET OF THE
EUROPEAN MONITORING CENTRE ON RACISM AND XENOPHOBIA (VIENNA) FOR THE FINAN-
CIAL YEAR ENDED 31 DECEMBER 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Budgetary and general accounts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Carry-overs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Advisory Committee on Procurements and Contracts (ACPC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5-7

5

6

7

Tables 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The Centre(cid:146)s replies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

51

51

51

51

51

52

54

22.12.1999

EN

Official Journal of the European Communities

C 372/51

OPINION OF THE COURT

1. This report is addressed to the Management Board of the
European Monitoring Centre on Racism and Xenophobia (the
Centre) in conformity with Article 12(11) of Council Regulation
(EC) No 1035/97 (1).

2. The Court has examined the financial statements of the Cen-
tre for its first financial year from 1 May to 31 December 1998.
In accordance with Article 12(8), of Regulation (EC) No 1035/97,
the budget was implemented under the responsibility of the
Executive Director. This responsibility included the drawing up
and presentation of the financial statements (2) in accordance with
the internal financial provisions, as provided for under Article
12(12) of Regulation (EC) No 1035/97. The Court of Auditors is
required under Article 248 of the Treaty establishing the Euro-
pean 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 audit
procedures as it deemed necessary in the circumstances. Through
the audit, the Court obtained a reasonable basis for the opinion
expressed below.

MAIN OBSERVATIONS CONCERNING THE IMPLEMENTATION
OF THE BUDGET OF THE EUROPEAN MONITORING CENTRE
ON RACISM AND XENOPHOBIA (VIENNA) FOR THE FINANCIAL
YEAR ENDED 31 DECEMBER 1998

Budgetary and general accounts

5. The Centre has not yet established a proper accounting sys-
tem in accordance with prevailing regulations. This should be
done without further delay so that the Centre can establish an
accurate accounting system covering budgetary as well as general
accounts.

Carry-overs

6. The documentation justifying the amounts carried over is
insufficient as most of the carry-overs relate to provisional com-
mitments.

Advisory Committee on Procurements and Contracts (ACPC)

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

7. The Centre operated in temporary premises during 1998. Per-
manent premises have now been found. In order to be able to
make proper investment decisions for the permanent premises an
ACPC should be established for the Centre.

This report was adopted by the Court of Auditors in Luxembourg at its meeting of 13 and 14 October 1999.

For the Court of Auditors

Jan O. KARLSSON

President

(1) OJ L 151, 10.6.1997, p. 1.
(2) As required under Article 12(10) of Regulation (EC) No 1035/97, the
accounts for the Centre(cid:146)s revenue and expenditure for the financial
year 1998 were drawn up on 18 March 1999 and forwarded to the
Centre(cid:146)s Management Board, the Commission and the Court of Audi-
tors. The Court received these accounts on 19 March 1999. A sum-
marised version of these financial statements is presented in the tables
attached to this report.

C 372/52

EN

Official Journal of the European Communities

22.12.1999

Table 1

Balance sheet as at 31 December 1998

Assets

Current assets
Amounts recoverable from the Commission
Salary advances
Recoverable VAT

Liabilities

Fixed capital
Balance for the financial year

1998

42
78
14

(ECU 1 000)

1998

(cid:150) 42

Subtotal

134

Subtotal

(cid:150) 42

Cash accounts
Bank accounts

Suspense account

Subtotal

Current liabilities
Automatic carry-overs of appropriations
Salary payable
Social liabilities
Commission account
VAT

310

310

9

Source: Prepared by the Court of Auditors on the basis of data from the Centre.

Total assets

453

292
118
29
42
14

495

453

Subtotal

Total liabilities

22.12.1999

EN

Official Journal of the European Communities

C 372/53

Revenue and expenditure account for the financial year 1998

Table 2

Revenue

Subsidy received from the Commission
Miscellaneous revenue

Expenditure

Staff expenditure (cid:151) Title I of the budget
Payments (1)
Appropriations carried over

Administrative expenditure (cid:151) Title II of the budget
Payments
Appropriations carried over

Operating expenditure (cid:151) Title III of the budget
Payments
Appropriations carried over

Out-turn for the financial year

Exchange rate differences

(ECU 1 000)

1998

500
4

504

212
120

14
61

29
111

547

(cid:150) 43

1

(cid:150) 42

Total revenue

Total expenditure

Balance for the financial year

(1) An amount of ECU 69 000 relating to additional salary and salary deductions is to be paid during 1999.
Source: Prepared by the Court of Auditors on the basis of data from the Centre.

C 372/54

EN

Official Journal of the European Communities

22.12.1999

REPLIES OF THE EUROPEAN MONITORING CENTRE ON RACISM AND XENOPHOBIA

On Item 5: Budgetary and general accounts

On Item 6: Carry-overs

Until 1 July 1999, the number of statutory agents did not exceed
four (2 A, 1 B, 1 C) including the Director, due to the length of
the recruitment procedure of the staff of the Centre. In March
1999, the Management Board nominated an accountant (the B
agent) for the transitional period until the accountant post is filled.
The recruitment procedure is now at the final stage and the
accountant should take up his post in the coming weeks.

Furthermore, in June the Board decided to start the technical dis-
cussions to introduce in the Centre the SI 2 common system for
financial and accounting system. Until this has been achieved the
Centre will use the accounting system with specialised software.

From the middle of July to the end of September 1998, the Direc-
tor was the only agent appointed in the Centre. The transfer of the
entire financial files, which were previously under the responsibil-
ity of the European Commission, took several weeks, therefore
during this period the Centre had to cover the starting phase with
provisional commitments. The regularisation was achieved early
in 1999.

On Item 7: Advisory Committee on Procurements and Contracts

Regarding the limited number of agents in the Centre and the nec-
essary separation of responsibilities, an internal ACPC could not
be established before July 1999. The Management Board has to
decide at its meeting of September 1999 the formal installation of
this ACPC. For the transitional period, the Centre had to consti-
tute an ad hoc ACPC to prepare the decisions to be taken for the
permanent premises.