Opinion No 9/2003 of the Court of Auditors of the European Communities on a draft Commission regulation on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes
Date: 2003-12-04
Institutions: European Court of Auditors
Subjects: EU office or agency, EU programme, financial regulation, management

23.1.2004

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Official Journal of the European Union

C 19/1

I

(Information)

COURT OF AUDITORS

OPINION No 9/2003

of the Court of Auditors of the European Communities on a draft Commission regulation on a
standard financial regulation for the executive agencies pursuant to Council Regulation (EC)
No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in
the management of Community programmes

(2004/C 19/01)

THE COURT OF AUDITORS OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Commu-
nity, and in particular Article 248(4) thereof,

Having regard to the request by the Secretary-General of the
Commission for an opinion on a draft Commission regulation (1)
on a standard financial regulation for the executive agencies pur-
suant to Council Regulation (EC) No 58/2003 laying down the
statute for executive agencies to be entrusted with certain tasks in
the management of Community programmes (2) (hereinafter the
‘draft Commission regulation’),

Whereas Articles 53 and 55 of the Financial Regulation appli-
cable to the general budget (hereinafter the ‘general Financial
Regulation’) (3) provide for implementation of the budget through
executive agencies,

Whereas the purpose of the draft Commission regulation is to
enforce Article 15 of Council Regulation (EC) No 58/2003, requir-
ing that the Commission should adopt a standard financial regu-
lation applicable to the operating budget of an executive agency,

HAS ADOPTED THE FOLLOWING OPINION:

1.
The English wording of the draft Commission regulation
presents the problems set out in this paragraph and in the follow-
ing one. As stated in its Article 1, the draft Commission regula-

(1) SEC(2003) 803 final of 11 July 2003.
(2) OJ L 11, 16.1.2003.
(3) Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002

(OJ L 248, 16.9.2002).

tion concerns the establishment and execution of the ‘administra-
tive budget’ of the executive agencies. In Council Regulation (EC)
No 58/2003 this budget is called ‘operating budget’. In its opinion
on the Commission’s proposal for Council Regulation (EC)
No 58/2003 (4), the Court had drawn attention to a risk of confu-
sion when using the adjective ‘operating’ with reference to admin-
istrative expenditure. The term ‘operating’ is nevertheless used in
Articles 5 and 21 of the draft Commission regulation with respect
to the expenditure dealt with in the administrative budget (5).

The term ‘management board’ is used in the draft Com-
2.
mission regulation, whereas an executive agency, pursuant to
Article 7 of Council Regulation (EC) No 58/2003 is managed by
a ‘Steering Committee’ and a director. The term ‘management
board’ should therefore be replaced by the term ‘Steering Com-
mittee’ throughout the text of the draft Commission regulation (6).

Article 9 of the draft Commission regulation lays down
3.
the possibility of carrying over ‘appropriations corresponding to
obligations duly contracted at the close of the financial year’.
According to the same draft article, these appropriations shall be
cancelled if not committed by 31 March of the following financial
year. However, according to Article 44 of the draft Commission
regulation and the corresponding provisions of the general

(4) Opinion No 8/2001 on a proposal for a Council Regulation laying
down the statute for executive agencies to be entrusted with certain
tasks in the management of Community programmes (OJ C 345,
6.12.2001).

(5) This problem does not occur, for example, in the French wording of
Council Regulation (EC) No 58/2003 and the draft Commission regu-
lation, where different terms are consistently used to distinguish
between administrative and operating expenditure.

(6) This problem does not occur, for example, in the French wording of
Council Regulation (EC) No 58/2003 and the draft Commission regu-
lation, where the same term is consistently used.

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Official Journal of the European Union

23.1.2004

Financial Regulation, before entering a legal obligation a budget-
ary committment must be made. Therefore, only committed
appropriations should be carried over. Appropriations that, at the
end of the financial year, have still not been used for budgetary
commitments should be cancelled.

In Articles 57 and 66 of its draft regulation the Commis-
4.
sion sets out that the Court comments on the provisional accounts
of the agency, makes an annual report and issues a statement of
assurance as to the reliability of the accounts and the legality and
regularity of the underlying transactions. This is not in line with
Council Regulation (EC) No 58/2003 which mentions, in Article
14(3), a ‘report by the Court of Auditors’, but does not refer to any
comments by the Court on provisional accounts or the issuing of
a statement of assurance. The draft Commission regulation should
not define the Court’s tasks further than Council Regulation (EC)
No 58/2003 does. The Court considers that it has no obligation

to comment on provisional accounts of these bodies set up by the
Community or to issue a specific annual report on each executive
agency.

Considering the effectiveness of the control of Community
5.
expenditure, the Court reiterates the recommendation made in
paragraph 20 of its opinion No 8/2001 and encourages the Com-
mission to provide, where appropriate, for a prior scrutiny of the
agencies’ accounts before their consolidation with the accounts of
the Commission.

6.
In its opinion No 8/2001 (points 14 to 16) the Court stated
that the accounting for and presentation of the operating expen-
diture and the running costs of an executive agency, financed
from the general budget, were not clear. This issue should be clari-
fied in the present draft financial regulation. The Court also stated
(point 17c) that the accounting for and presentation of expendi-
ture on programmes funded by other sources than the general
budget were not clear. This issue should equally be clarified in the
present draft regulation.

This opinion was adopted by the Court of Auditors in Luxembourg on 4 December 2003.

For the Court of Auditors

Juan Manuel FABRA VALLÉS

President