Report by the independent auditor on the Court of Auditors' accounts for the financial year 2001
Date: 2002-07-23
Institutions: European Court of Auditors
Subjects: European Court of Auditors, accounting, auditing, financial management, financial year, report

4.11.2002

EN

Official Journal of the European Communities

C 268/1

I

(Information)

COURT OF AUDITORS

REPORT BY THE INDEPENDENT AUDITOR ON THE COURT OF AUDITORS’ ACCOUNTS FOR
THE FINANCIAL YEAR 2001

(2002/C 268/01)

NOTE TO READERS

Without prejudice to the provisions of Article 248 of the Treaty establishing the European Community, which
gives the Court of Auditors responsibility for auditing all of the Community’s revenue and expenditure, and
the provisions of Article 276 of the said Treaty concerning the granting of discharge, the Court of Auditors
has had its revenue and expenditure accounts audited by an independent auditor every year since the close of
the financial year 1987.

The reports that the independent auditor of the Court of Auditors drew up in respect of the Court’s accounts
for the financial years 1987 to 1991 were only sent to the Chairman of the European Parliament’s Committee
on Budgetary Control.

Pursuant to a decision taken by the Members of the Court of Auditors at the Court meeting of 8 July 1993,
the independent auditor’s reports have been published in the Official Journal of the European Communities since
the report on the financial year 1992.

For the Court of Auditors

Juan Manuel FABRA VALLES

President

C 268/2

EN

Official Journal of the European Communities

4.11.2002

CONTENTS

Certificate concerning the regularity and fairness of the financial statements at 31 December 2001 . . . . .

Report on the administrative and accounting procedures, the soundness of the financial management
and the internal control system . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Financial statements at 31 December 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

3

4

5

4.11.2002

EN

Official Journal of the European Communities

C 268/3

Certificate concerning the regularity and fairness of the financial statements at 31 December 2001

To the Members of the European Court of Auditors

In accordance with the instructions given to us by the European Court of Auditors, we have examined:

— the accounting data sent by the European Court of Auditors to the Commission for the purpose of draw-
ing up the revenue and expenditure account and the balance sheet of the European Communities for the
financial year 2001,

— the financial statements of the European Court of Auditors at 31 December 2001, which were drawn up
on the basis of the same accounting data and prepared for the purpose of publication in the Official Journal
of the European Communities.

The accounting data and the financial statements are the responsibility of the European Court of Auditors. Our
responsibility is, on the basis of our audit work, to express an opinion on the accounting data and the financial
statements.

We have conducted our work in accordance with international auditing standards. These standards require us
to plan and carry out our work in such a way as to obtain reasonable assurance that the accounting data and
the financial statements do not contain any material misstatement. As required, the audit included an examina-
tion, on the basis of a sample, of the evidence in support of the amounts and information contained in the
accounting data and financial statements. It also included an appraisal of the accounting principles and prac-
tices applied and of the significant estimates used by the European Court of Auditors in drawing up the
accounts, as well as a review of their overall presentation. We think that the audit provided a reasonable basis
for the opinion expressed.

In our opinion, the enclosed accounting data and financial statements give a true and fair view, in accordance
with the Financial Regulation, the implementing rules, generally accepted accounting principles and the Euro-
pean Court of Auditors’ Internal Rules, of the assets and financial position of the European Court of Auditors
at 31 December 2001 and of the economic result and the revenue and expenditure for the financial year then
ended.

Luxembourg, 23 July 2002.

KPMG Audit

Auditors

S. NYE

C 268/4

EN

Official Journal of the European Communities

4.11.2002

Report on the administrative and accounting procedures, the soundness of the financial
management and the internal control system

To the Members of the European Court of Auditors

As part of our audit of the annual financial statements of the European Court of Auditors for the financial
year ending 31 December 2001, we examined the administrative and accounting procedures, the soundness
of the financial management and the internal control system. The purpose of our examination was to ensure
that the various departments of the Court of Auditors can be reasonably sure that:

— they have a clear view of the extent to which operational objectives are being achieved,

— the basis on which the published financial statements are drawn up is reliable,

— the financial management of the Court of Auditors complies with current regulations.

The current regulations in question are:

— the Financial Regulation of 21 December 1977 applicable to the general budget of the European Com-

munities, as last amended by Council Regulation (EC, ECSC, Euratom) No 762/2001,

— Commission Regulation (Euratom, ECSC, EC) No 3418/93 of 9 December 1993 laying down detailed rules
for the implementation of certain provisions of the Financial Regulation of 21 December 1977, as amended
by Regulation (EC) No 1687/2001,

— the Internal Rules of the European Court of Auditors for the implementation of the Court’s budget, laid
down by Court Decision No 97-47 of 4 December 1997 (as last amended by Written Procedure No 3/97
of 16 January 1998).

We therefore examined very closely the control environment, risk evaluation, control activities, information
and communications systems and management procedures of the European Court of Auditors. The initial
descriptive phase was followed by systems evaluation based on sample checks of supporting documents and
interviews with staff. The nature and extent of our tests were determined by our appraisal of the control envi-
ronment. We think that our work forms a reasonable basis for our conclusions regarding the European Court
of Auditors’ procedures, the soundness of its financial management and its internal control system.

In our opinion the current internal control rules ensure that the operational objectives are achieved satisfac-
torily, the financial statements are reliably drawn up and the legal framework is complied with.

Luxembourg, 23 July 2002.

KPMG Audit

Auditors

S. NYE

4.11.2002

EN

Official Journal of the European Communities

C 268/5

Financial statements at 31 December 2001

Balance sheet at 31 December 2001

Notes

2001

2000

(in 1 000 EUR)

ASSETS

Intangible fixed assets

Tangible fixed assets

Land and buildings

Plant, machinery and tools

Furniture and vehicle fleet

Computer hardware

Tangible assets in course of construction, advances and payments
on account in respect of tangible assets

Financial assets

Other financial assets

Stocks

Short-term assets

Current assets

Sundry debtors

Disposable assets

Transitional accounts

LIABILITIES

Own capital

Economic result for the financial year

Results carried over from previous years

Long-term liabilities

Other long-term liabilities

Short-term liabilities

Other short-term financial liabilities

Current liabilities

— Community institutions and bodies

— Sundry creditors

Transitional accounts

Total assets

2

2

3

4

5

6

7

7

128

48

24 367

13 248

253

385

391

20 425

14 179

361

472

413

10 090

5 000

289

289

132

763

216

547

946

16

289

289

124

410

78

332

856

—

26 641

22 152

24 559

4 049

20 510

87

87

1 695

31

1 664

980

684

300

20 510

3 613

16 897

27

27

1 365

242

1 123

645

478

250

The notes annexed hereto form an integral part of these financial statements.

Total liabilities

26 641

22 152

C 268/6

EN

Official Journal of the European Communities

4.11.2002

Statement of economic result at 31 December 2001

Notes

2001

2000

(in 1 000 EUR)

Positive adjustments

Decrease in expenditure: increase in assets

— Intangible fixed assets

— Tangible fixed assets

— Stocks

Write-back of depreciation

Revenue arising from budgetary entitlements acquired during the
year and not collected

Negative adjustments

Decrease in revenue: decrease in assets

— Tangible fixed assets

— Stocks

— Collection of entitlements established in previous years

Allocation for depreciation

Non-budgetary expenditure

Economic result for the year

The notes annexed hereto form an integral part of these financial statements.

2

2

2

8

2

9

2

10

6

146

5 617

7

122

92

16

5 415

—

531

28

5 984

5 990

(157)

—

(28)

(1 706)

(44)

(1 935)

4 049

(441)

(8)

(143)

(1 669)

(116)

(2 377)

3 613

4.11.2002

EN

Official Journal of the European Communities

C 268/7

Statement of revenue and expenditure for the financial years at 31 December 2001

Notes

2001

2000

(in 1 000 EUR)

Revenue

Contribution from the general revenue of the European Commun-
ities

— European Court of Auditors’ own revenue

— Community levies and dues deducted from remuneration

— Revenue accruing from the administrative operation of the insti-

tution

— Miscellaneous revenue

Total revenue

Expenditure

Expenditure relating to persons working for the institution

— Members of the institution

— Staff in active employment

— Allowances and miscellaneous contributions relating to termin-

ation of service

— Missions and duty travel

— Other

Operating expenditure

— Expenditure on immovable property

— Expenditure on data-processing

— Movable property and associated costs

— Current administrative expenditure

— Publishing and information

— Other

Total expenditure

Balance for the financial year

The notes annexed hereto form an integral part of these financial statements.

11

13

12

13

14

58 393

55 798

9 112

1 546

6

8 572

1 250

63

69 057

65 683

5 916

47 998

—

1 932

1 337

5 847

45 739

26

2 078

1 313

57 183

55 003

7 775

1 078

565

496

1 213

434

11 561

68 744

313

7 591

999

569

502

857

597

11 115

66 118

(435)

C 268/8

EN

Official Journal of the European Communities

4.11.2002

Notes to the financial statements at 31 December 2001

ACCOUNTING PRINCIPLES

1.

The accounts of the European Court of Auditors are kept
and the financial statements drawn up in accordance with
the provisions of the Financial Regulation of 21 December
1977, as last amended by Council Regulation (EC, ECSC,
Euratom) No 762/2001 of 9 April 2001, and the provisions
of Commission Regulation (Euratom,
EC)
No 3418/93 of 9 December 1993, as amended by Regula-
tion No 1687/2001 of 21 August 2001, laying down detailed
rules for the implementation of certain provisions of the
Financial Regulation.

ECSC,

In accordance with Article 136 of the said implementing
rules, the financial statements are presented in accordance
with generally accepted accounting principles, including
the principles provided for in Council directives, except
where otherwise provided for by regulation.

BALANCE SHEET

2.

Tangible and intangible fixed assets
The Court’s tangible and intangible fixed assets are valued
at their acquisition value in national currency, converted
into euro at the accounting rate in force at the time of pur-
chase.

The acquisition cost of the land and the net value, calcu-
lated after depreciation, of the other tangible fixed assets are
entered on the assets side for the entire period of their use.

Tangible and intangible fixed assets other than land and
buildings are not recorded in fixed assets accounts unless
their value is EUR 420 or more, as a result of the Commis-
sion decision of 16 November 2000 updating, with effect
from 1 January 2000, the amounts specified in Regulation
(Euratom, ECSC, EC) No 3418/93 laying down detailed rules
for the implementation of the Financial Regulation.

The European Court of Auditors has calculated the depre-
ciation of its fixed assets in accordance with Commission
Regulation (EC) No 2909/2000 of 29 December 2000 on
the accounting management of the European Communities’
non-financial fixed assets.

Changes in value and depreciation data, calculated using the
straight-line method and by complete year, were as follows
at the end of the financial year:

Land and
buildings

Plant, machinery
and tools

Furniture and
vehicle fleet

Computer
hardware

(in 1 000 EUR)

Total

Fixed assets in
course of
construction
and payments
on accounts

Acquisition value
At end of the previous year

Changes over the year:
— Acquisitions
— Disposals and withdrawals
— Variations due to change in

threshold

24 532

1 074

1 410

1 771

5 000

33 787

28
—

—

52
(17)

—

149
(109)

—

298
(31)

—

5 090
—

—

5 617
(157)

—

At end of the financial year

24 560

1 109

1 450

2 038

10 090

39 247

Depreciation and value adjustments
At end of the preceding financial
year

Changes over the financial year:
— Recorded
— Cancelled following disposal,

withdrawal

(10 353)

(713)

(938)

(1 358)

(959)

(159)

(202)

(320)

—

16

75

31

At end of the financial year

(11 312)

(856)

(1 065)

(1 647)

—

—

—

—

(13 362)

(1 640)

122

(14 880)

Net book value At end of financial
year

13 248

253

385

391

10 090

24 367

4.11.2002

EN

Official Journal of the European Communities

C 268/9

The fixed assets in course of construction include an amount
of EUR 10 090 000 relating to the planned extension of the
Court building.

The heading ‘intangible fixed assets’ includes computer soft-
ware packages acquired that are covered by a site licence or
a major account contract.

4.

Stocks

The stocks comprise office supplies and other consumables,
valued at the price of the last supplies entered. Where the
acquisition cost is expressed in national currency, it is con-
verted into euro at the accounting rate used in drawing up
the balance sheet.

5.

Short-term assets

(in 1 000 EUR)

Computer
software

The heading ‘Current assets’ at the year-end is broken down
as follows:

Acquisition value
At end of the preceding financial year

Changes over the financial year:
— Acquisitions in the financial year

At end of the financial year

Depreciation and reductions in value
At end of the preceding financial year

Changes over the financial year:
— recorded

At end of the financial year

Net book value at end of financial year

118

146

264

(70)

(66)

(136)

128

Claims relating to Community institu-
tions and bodies
Sundry debtors

Total

(in 1 000 EUR)

2001

2000

146
70

216

57
21

78

The item ‘Sundry debtors’ consists solely of claims relating
to staff, and mainly concerns advances paid on mission
expenses already incurred but not yet charged.

6.

Own capital

3.

Financial assets

The heading ‘Other financial assets’ comprises two operat-
ing funds, one of which relates to the Office for Official
Publications of the European Communities, and the other
to the Translation Centre for the bodies of the European
Union.

(in 1 000 EUR)

Acquisition
value at
31.12.2000

Changes over
the financial
year

Acquisition
value at
31.12.2001

Guarantees and
advances granted

1. Guarantees
2. Advances
granted

Total

1

288

289

—

—

—

1

288

289

There is no reduction in value to be recorded for the finan-
cial year 2001.

In the old presentation of the accounts that applied until
31 December 1999, own capital was the contra-entry of
tangible and intangible fixed assets and stocks.

For the financial year 2001, the total for own capital com-
prises the economic result for the year and the result car-
ried over from previous years.

The result carried over from previous financial years cor-
responds to own capital and the contra-entry of revenue to
be collected for the financial year 2000.

The economic result for the year comprises the result of the
implementation of the budget for the year and the result of
adjustments.

The result of the implementation of the budget for the year
can only be established on consolidation of the financial
statements by the European Commission.

Consequently, for the other institutions, the economic result
for the financial year is limited to the sum of the positive
and negative adjustments entered in accounts of non-
budgetary expenditure and revenue.

C 268/10

EN

Official Journal of the European Communities

4.11.2002

7.

Liabilities

7.1.

Long-term liabilities

The item ‘Other long-term liabilities’ comprises the part of
the architect’s and consulting engineer’s fees withheld as a
performance guarantee for their work in respect of the
extension of the Court building.

The heading ‘Revenue accruing from the administrative
operation of the institution’ comprises mainly:

— revenue accruing from the publication of the European
Court of Auditors’ reports and opinions in the Official
Journal of the European Communities,

— the payment of actuarial reserves by national pension
bodies and provident societies by way of transfers of
officials’ pension rights.

7.2.

Short-term liabilities

12.

Expenditure

The item ‘Other short-term financial liabilities’ comprises
payments effected in accordance with Article 6 of the Finan-
cial Regulation, between 1 and 15 January of the following
financial year (formerly called ‘Payments in hand’).

The item ‘Community institutions and bodies’ comprises
sums due to the European Communities Sickness Insurance
Fund and the balance to be carried forward to the follow-
ing financial year.

The item ‘Sundry creditors’ mainly comprises sums due in
respect of social and insurance contributions for staff as
well as mission expenses still to be invoiced by the credit
card organisation.

Expenditure for the financial year, which is shown in the
statement of revenue and expenditure, represents the pay-
ments made against the appropriations for the financial
year and against the appropriations carried over from the
previous financial year in accordance with the provisions of
the applicable regulations.

In accordance with the sixth subparagraph of Article 6 of
the Financial Regulation, the expenditure for the financial
year is entered in the accounts for that year on the basis of
the expenditure for which authorisation reached the Finan-
cial Controller not later than 31 December and the account-
ing officer not later than the following 10 January, and for
which payment was effected by the accounting officer not
later than 15 January.

8.

Revenue arising from budgetary entitlements
acquired during the financial year and not collected

13.

Exchange differences

This item concerns revenue established during the financial
year under review and not yet collected.

Exchange gains or losses are entered in the statement of rev-
enue and expenditure as ‘Miscellaneous revenue’ or ‘Operat-
ing expenditure — Other’.

9.

Revenue arising from budgetary entitlements
established during previous financial years

14. Balance for the financial year

This item concerns revenue established in a previous finan-
cial year which has been collected and entered in the
accounts in the financial year under review.

10. Non-budgetary expenditure

This item concerns sundry expenditure which could not be
materially booked to the budget.

REVENUE AND EXPENDITURE

The balance for the year is the difference between the total
revenue for the year and the expenditure against appropria-
tions specific to the year and appropriations carried for-
ward from the previous year.

The changes in the balance to be carried forward to the fol-
lowing financial year are as follows:

(in 1 000 EUR)

2001

2000

Balance carried forward from previous
years
Balance for the year

465
313

900
(435)

Balance to be carried forward to the
following financial year

778

465

11.

European Court of Auditors’ own revenue

15. Budgetary implementation

The European Court of Auditor’s own revenue is entered in
the accounts on the basis of the amounts actually received
during the financial year.

The implementation of the budget for the financial year
2001 can be divided up into the implementation of appro-
priations brought forward and the implementation of appro-
priations for the financial year.

4.11.2002

EN

Official Journal of the European Communities

C 268/11

(a) Appropriations brought forward represent, on the one hand, all the commitments chargeable to the
Court that have been entered into but not settled before the year-end and, on the other hand, appro-
priations which the budgetary authority has decided to carry forward. Appropriations brought for-
ward from the previous year and not used during the following year lapse:

(in 1 000 EUR)

Payments

Lapsed
appropriations

Appropria-
tions carried
forward from
2000 to 2001

Expenditure relating to persons working for the institu-
tion
— Members of the institution
— Staff in active employment
— Missions and duty travel
— Other

Operating expenditure
— Expenditure on immovable property
— Expenditure on data processing
— Movable property and associated costs
— Current administrative expenditure
— Publishing and information
— Other

50
54
460
264

828

5 355
106
125
181
954
197

6 918

Total

7 746

46
44
416
234

740

5 335
100
120
161
815
162

6 693

7 433

4
10
44
30

88

20
6
5
20
139
35

225

313

(b) The implementation of the appropriations for the financial year represents the payments made
against appropriations committed. The unpaid balance of the commitments may be carried forward
to the following financial year. Appropriations still uncommitted at the end of the year usually lapse:

Expenditure relating to persons
working for the institution
— Members of the institution
— Staff in active employment
— Missions and duty travel
— Other

Buildings, equipment and sundry
items of operating expenditure
— Expenditure on immovable property
— Expenditure on data processing
— Movable property and associated

costs

— Current administrative expenditure
— Publishing and information
— Other

Appropria-
tions for the
year

Commit-
ments
chargeable to
the year

Payments

(in 1 000 EUR)

Appropria-
tions carried
forward to
2002

Lapsed
appropria-
tions

5 950
49 387
2 163
1 509

5 944
48 024
2 163
1 493

5 870
47 954
1 516
1 103

74
70
647
390

59 009

57 624

56 443

1 181

10 289
1 090

600
564
1 234
601

10 288
1 089

593
563
1 233
578

2 440
978

445
335
398
272

7 848
111

148
228
835
306

14 378

14 344

4 868

9 476

6
1 363
—
16

1 385

1
1

7
1
1
23

34

Total

73 387

71 968

61 311

10 657

1 419

C 268/12

EN

Official Journal of the European Communities

4.11.2002

Payments against appropriations carried forward (euro 7 433 000) and the appropriations for the
year (euro 61 311 000) totalled euro 68 744 000 which is equal to the total expenditure shown in
the statement of revenue and expenditure for the financial year 2001.