WRITTEN QUESTION E-2127/03 by Bart Staes (Verts/ALE) to the Commission. Guarantees as to the correctness of businesses' financial information.
Date: 2003-06-25
Institutions: European Parliament, Provisional data
Subjects: corporate governance, financial management, financial situation, information, management accounting, standardised accounting system, type of business

C 78 E/80

Official Journal of the European Union

EN

27.3.2004

Answer given by Mr Patten on behalf of the Commission

(4 August 2003)

The main programme for providing financial assistance to Moldova is Tacis. This programme offers
technical assistance on the basis of shared values and priorities agreed with the partner countries
concerned. Currently, Tacis is not engaged in activities directed to support the development of renewable
energy resources in Moldova, since they have not been identified among national priorities.

Tacis is, however, engaged in the development of the energy market and resources through the Inogate
regional programme, whose activities cover Moldova.

In addition, Moldova is an observer in the dialogue on Regional Electricity Market in South East Europe
that is organised by the Commission. This provides a forum in which Moldova can learn from the
experience of other countries on how to ensure balanced approach to energy production.

Finally, the multi-annual programme Intelligent Energy for Europe (IEE), covering the period 2003-2006, is
open to Candidate Countries and includes also a domain, called Coopener, which is devoted to co-
operation with third countries. At present, however, a final decision has yet to be made regarding possible
beneficiary countries.

European Investment Bank (EIB) loans and projects are not open to Moldova. However, in Moldova this
type of activity could be financed through European Bank for Reconstruction and Development (EBRD)
loans. Bulgaria and Romania do benefit from EIB loans under the general lending mandate for Central and
Eastern European countries, guaranteed by the Community budget, and under the three-year Pre-Accession
Facility, which is not covered by the Community guarantee. The EIB is interested in increasing support for
investments in renewable energy, including wind energy. Its aim is to at least double its loan volume
(individual and dedicated global loans) for renewable energy between 2002 and 2007.

The objective of achieving a 12 % contribution from renewable energy sources to overall energy
consumption in the Union was included in Commission White Paper from 1997 (1). The Directive 2001/
77/EC of the Parliament and of the Council of 27 September 2001 on the promotion of electricity
produced from renewable energy sources in the internal electricity market (2) is part of the ‘acquis’ to be
implemented by Romania and Bulgaria before accession. Both countries have been regularly encouraged to
enhance the use of renewable energy and to define national indicative targets, consistent with the global
indicative target of 12 % of gross national energy consumption by 2010.

(1) COM(97) 599 final.
(2) OJ L 283, 27.10.2001.

(2004/C 78 E/0079)

WRITTEN QUESTION E-2127/03

by Bart Staes (Verts/ALE) to the Commission

(25 June 2003)

Subject: Guarantees as to the correctness of businesses’ financial information

The Flemish newspaper De Standaard reported on 13 June 2003 that a majority (three quarters) of
financial directors have doubts about the accuracy and quality of the available financial
information
concerning their business. These findings come from a study by a French business specialising in financial
reporting software and are based on information supplied by 150 financial directors of large international
companies.

27.3.2004

EN

Official Journal of the European Union

C 78 E/81

Is the Commission aware of this alarming finding and, bearing in mind that several major business
scandals have occurred recently, will it:

(a)

check these data, and

(b)

take measures to guarantee that such companies’ employees, investors and customers (i.e. society)
receive accurate financial information?

If so, what steps will the Commission take to this end?

If not, why will the Commission not take any action on the findings of this study?

Answer given by Mr Bolkestein on behalf of the Commission

(6 August 2003)

The Commission was not aware of this specific study by a French company specialising in financial
(a)
reporting software. It will however, assess this study. The survey results, if correct, are indeed of concern,
and also surprising. Surprising because financial directors of large international companies from the Union
normally sign-off for the accuracy of the financial statements as a member of the board of directors.

Back in 1999 when the Commission proposed the International Accounting Standards (IAS)
(b)
financial reporting strategy,
the Commission emphasised that Europe needs strong and consistent
enforcement of IAS. Enron and other scandals have confirmed the importance that the Commission
attached to enforcement of financial reporting standards. The Commission is working on high quality IAS
enforcement on different fronts with European national securities regulators through the Committee of
European Securities Regulators (CESR) network,
the action plan on company law and corporate
governance as well as through improving the audit function in the Union.

The following measures have been proposed or adopted to ensure accurate financial reporting:

(cid:1) CESR adopted in April 2003 its first standard on Financial Information: ‘Enforcement of standards on
financial information in Europe’. This standard represents a significant contribution to the task of
developing and implementing a common approach to the enforcement of International Accounting
Standards in Europe.

(cid:1) The Commission’s action plan on ‘Modernising Company Law and Enhancing Corporate Governance
in the European Union’ (1)
(issued on 21 May 2003) called, amongst many other actions, for a
legislative measure to confirm at Union level the collective responsibility of board members for
financial statements as a short term priority.

(cid:1) The Commission outlined in its Communication ‘Reinforcing the statutory audit in the EU’ (2), of
21 May 2003 a series of actions aimed at further improving statutory audit quality in the Union.
Important short term priorities will be the modernisation of Union legislation on auditing (the 8th
Company Law Directive (3)), strengthening public oversight and the use of International Standards on
Auditing from 2005 onwards.

These actions demonstrate that the Commission is strongly committed to ensuring proper financial
reporting which is a crucial to protect the interests of shareholders, creditors, employees and other
stakeholders.

(1) COM(2003) 284 final.
(2) COM(2003) 286 final.
(3) Eighth Council Directive 84/253/EEC of 10 April 1984 based on Article 54 (3)(g) of theTreaty on the approval of

persons responsible for carrying out the statutory audits of accounting documents, OJ L 126, 12.5.1984.