Report on the annual accounts of the the European Training Foundation for the financial year 2006 together with the Foundation's replies
Date: 2007-09-27
Institutions: European Court of Auditors
Subjects: European Court of Auditors, European Training Foundation, administration of the Institutions, financial control, implementation of the budget, powers of the institutions (EU), report

C 309/122

EN

Official Journal of the European Union

19.12.2007

on the annual accounts of the the European Training Foundation for the
financial year 2006 together with the Foundation’s replies

REPORT

(2007/C 309/21)

CONTENTS

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

STATEMENT OF ASSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

OBSERVATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Paragraph

1-2

3-6

7-8

Tables 1 to 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The Foundation’s replies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

123

123

123

124

127

19.12.2007

EN

Official Journal of the European Union

C 309/123

INTRODUCTION

The European Training Foundation (hereinafter called ‘the
1.
Foundation’) was
created by Council Regulation (EEC)
No 1360/90 of 7 May 1990 (1). The Foundation’s purpose is to
support the reform of vocational training in the European Union’s
partner countries. As such, it assists the Commission in the imple-
mentation of various programmes
(Phare, Tacis, CARDS
and MEDA).

2.
Table 1 summarises the competences and activities of the
Foundation. Key data summarised from the financial statements
drawn up by the Foundation for the financial year 2006, is pre-
sented in Tables 2, 3 and 4 for information purposes.

STATEMENT OF ASSURANCE

This Statement of Assurance is addressed to the European
3.
Parliament and the Council in accordance with Article 185(2) of
Council Regulation (EC, Euratom) No 1605/2002 (2);
it was
drawn up following an examination of the Foundation’s accounts,
as required by Article 248 of the Treaty establishing the European
Community.

4.
The Foundation’s accounts for the financial year ended
31 December 2006 (3) were drawn up by its Executive Director,
pursuant to Article 11 of Regulation (EEC) No 1360/90, and sent
to the Court, which is required to deliver a Statement of Assur-
ance on the reliability and on the legality and regularity of the
underlying transactions.

The Court has obtained a reasonable basis for the State-

6.
ment set out below:

Reliability of the accounts

The Foundation’s accounts for the financial year ended
31 December 2006 are, in all material respects, reliable.

Legality and regularity of the underlying transactions

transactions underlying the Foundation’s

The
accounts, taken as a whole, are legal and regular.

annual

The observations which follow do not call the Court’s State-
ment into question.

OBSERVATIONS

7.
Title III appropriations are differentiated. Article 31 of the
Framework Financial Regulation requires that the budget pub-
lished in the Official Journal shows both commitment and pay-
ment
schedule when
appropriations are differentiated. The Foundation only published
the commitment appropriations for its 2006 budget. This did not
respect the rules for budget presentation.

appropriations with a payment

The Court conducted its audit in accordance with the IFAC
5.
and INTOSAI International Auditing Standards and Codes of Eth-
ics, insofar as these are applicable in the European Community
context. The audit was planned and performed to obtain reason-
able assurance that the accounts are reliable and that the under-
lying transactions are legal and regular.

In 2006, the Foundation had two ongoing MEDA and
8.
TEMPUS multi-annual contracts with the Commission, both
entered into in 2004. Funds provided by these contracts are con-
sidered to be assigned revenue. The Foundation entered the total
contractual amount of these revenues in its budget instead of the
amounts to be received each year.

This report was adopted by the Court of Auditors in Luxembourg at
27 September 2007.

its meeting of

For the Court of Auditors
Hubert WEBER
President

(1) OJ L 131, 23.5.1990, p. 1.
(2) OJ L 248, 16.9.2002, p. 1.
(3) These accounts were drawn up on 26 June 2007 and received by the

Court on 3 July 2007.

Table 1

European Training Foundation (Turin)

Areas of Community competence
deriving from the Treaty

Competences of the Foundation
Council Regulation (EEC) No 1360/90 of 7 May 1990

Governance

Resources made available
to the Foundation in 2006
(2005 data)

Products and services supplied during
the financial year 2006

‘The Community shall carry out,
within its spheres of competence,
economic, financial and technical
cooperation measures with third
countries. Such measures shall be
complementary to those carried
out by the Member States and
consistent with the development
policy of the Community’.

(Article 181 A)

Objectives

Tasks

Governing Board

Budget

Activities

— To contribute to the devel-
opment of the professional
training systems of Central
and Eastern Europe and the
independent States of the
former Soviet Union ben-
efiting from the programme
to assist economic reform
and recovery of the territo-
ries and non- Member Medi-
terranean
countries
benefiting from financial
and technical accompany-
ing measures for the reform
of their economic and social
structures.

— To promote the coordina-
tion of the assistance given
to eligible countries.

In accordance with the general
guidelines laid down by the Com-
munity, the ETF operates in the
field of training, covering, profes-
sional, initial and lifelong training
and the retraining of young
people and adults via the follow-
ing tasks:

— assistance in defining train-
ing needs and priorities via
the implementation of tech-
nical assistance measures in
the training field and via
cooperation with the appro-
priate designated bodies in
the eligible countries;

— acts as a clearing house to
provide the Community, its
Member States and the non-
Member States concerned
information on current ini-
tiatives and future needs in
the training field and pro-
vides a framework for chan-
nelling offers of assistance.

— One

representative of

each Member State

— Three representatives of

the Commission

— Chaired by the Commis-

sion

Director

— Appointed by the Gov-
erning Board on a pro-
posal
the
from
Commission

Advisory Forum

— Appointed by the Gov-

erning Board

— Two experts from each

Member State

— Two experts from each

eligible country

— Two experts

from the
social partners at Euro-
pean level

26,5 (26,3) million euro divided up into
19,5 (18,5) million euro funded by a Com-
mission subsidy and 7,0 (7,8) million euro
funded by other bodies as assigned rev-
enue.

This sum of 7,0 million euro divides up as
follows:

0,98 million euro from the Italian Ministry
of foreign affairs;

4,37 million euro from DG AIDCO (Meda-
ETE);

1,69 million euro from DG EAC (Tempus)

Staff numbers as at 31 December 2006

105 (104) temporary posts in the estab-
lishment plan of which 94 (97) posts occu-
pied.

32 (22) other staff (auxiliaries, local agents,
contract staff

The assistance supplied by the Foundation covers a
large range of technical fields including: initial voca-
tional training, lifelong learning, continuing (adult) edu-
cation, human resource development in companies,
employment policies, training of unemployed people,
poverty alleviation and social inclusion and training to
encourage local development.

Support for the Commission

In 2006, 97 new requests for support were received
from the Commission. The majority came from the del-
egations (38 %), AIDCO (21 %), DG EAC (16 %) fol-
lowed by DG ELARG and EAR (7 %), DG RELEX (5 %).
DG EMPL (4 %). This included 24 analyses of the situ-
ation in the ENPI countries. The Commission’s rate of
satisfaction with the ETF’s response was 97 %. The most
frequent applications were those in the field of pro-
gramming, followed by policies and contributions in
the preparation of European Neighbourhood Instru-
ments, the identification of projects and follow-up.

Information and analysis

Total staff: 126 (119), assigned to the fol-
lowing duties:

Country sector studies, statistics on education, policy
advice to countries.

— operational tasks: 73 (68)

Innovation and development support projects.

External audit

— administrative tasks: 34 (33)

European Court of Auditors

— mixed tasks: 19 (18).

Internal audit

Commission’s
department

Discharge

internal

audit

European Parliament on a rec-
ommendation from the Council

As a centre of expertise, the ETF contributes towards
the setting up of development projects in order to test
innovatory approaches allowing partner countries to
carry out reforms of their education and vocational
training systems.

Technical assistance to DG EAC for the implementation of
the Tempus programme

Assistance Conventions with CARDS, MEDA and
Tacis for the Tempus programme:

This assistance covers the whole cycle of the project. It
includes the selection, management and follow-up of
contracts and information and communication, includ-
ing general administrative support. IT tools such as
online applications and report forms have greatly facili-
tated the administrative management of the various
project cycles.

C
3
0
9
/
1
2
4

E
N

O

f
f
i
c
i
a
l

J
o
u
r
n
a
l

o
f

t
h
e

E
u
r
o
p
e
a
n
U
n
o
n

i

Source:

Information provided by the Foundation.

.

1
9
1
2
2
0
0
7

.

European Training Foundation (Turin) — Budgetary implementation for the financial year 2006

Table 2

Origin of Revenue

Revenue

Revenue entered
in the final budget for
the financial year

Revenue collected

Allocation of expenditure

Community subsidies

19 450

19 450

Other revenue

2

64

Title I
Staff (NDA)

Title II
Administration (NDA)

Title III
Operating activites (DA)

Expenditure

Appropriations for the financial year

(1 000 euro)

Appropriations carried over from
the previous financial year

entered

committed

paid

carried
over

cancelled

available

paid

cancelled

12 239

11 990

11 427

562

1 719

1 595

1 158

437

249

124

478

326

409

287

— CA

— PA

5 495

5 495

4 970

0

1 918

525

0

0

0

3 052

0

2 443

1 925

1 474

Earmarked
revenue: Italian gov-
ernment

Earmarked revenue:
ETE-MEDA

Earmarked revenue:
TEMPUS

980

314

Earmarked revenue: Italian gov-
ernment

980

544

500

480

4 365 (1)

2 000

Earmarked revenue: ETE-MEDA

4 365 (1)

3 114

1 234

3 131

1 686

624

Earmarked revenue: TEMPUS

1 686

1 616

822

Total

26 484

22 452

Total CA

26 484

23 829

18 193

Total PA

26 484

18 859

18 193

(1) The initial amount entered in the budget was 4 865 000 euro, of which 500 000 euro was not paid by the Commission. For clarity and accuracy the amended amount (4 365 000 euro) is shown.
NDA: non-differentiated appropriations (commitment appropriations are equal to payment appropriations).
differentiated appropriations (commitment appropriations may differ from payment appropriations).
DA:
commitment appropriations in a system of differentiated appropriations.
CA:
PA:
payment appropriations in a system of differentiated appropriations.
Source: Data supplied by the Foundation. This table summarises the data provided by the Foundation in its annual accounts. Revenue collected and payments are estimated on a cash basis.

0

0

0

897

2 816

356

2 365

1 062

4 587

6 512

0

0

0

696

2 170

864

7 392

5 474

68

39

0

451

356

2 365

1 062

3 890

4 342

.

1
9
1
2
2
0
0
7

.

E
N

O

f
f
i
c
i
a
l

J
o
u
r
n
a
l

o
f

t
h
e

E
u
r
o
p
e
a
n
U
n
o
n

i

C
3
0
9
/
1
2
5

C 309/126

EN

Official Journal of the European Union

19.12.2007

European Training Foundation (Turin) — Economic outturn account for the financial years 2006 and 2005

Table 3

(1 000 euro)

2006

2005

Operating revenue

Community subsidies

Other subsidies

Other MEDA ETE

Other Tempus TA 2004/05

Awaiting clearance EC — ETE MED and TEMPUS TA

Operating expenditure

Staff expenditure

Fixed asset-related expenditure

Other administrative expenditure

Operational expenditure

Total (a)

Total (b)

Surplus/(deficit) from operating activities (c = a – b)

Financial operations revenue (e)

Financial operations expenditure (f)

Surplus/(deficit) from non-operating activities (g = e – f)

16 052

314

—

—

2 868

19 234

11 539

359

2 580

7 204

21 682

– 2 448

—

1

– 1

Economic result for the year (h = c + g)

– 2 449

European Training Foundation (Turin) — Balance sheet at 31 December 2006 and 2005

Table 4

18 484

479

5 000

2 363

—

26 326

11 785

362

1 729

12 237

26 113

214

—

1

– 1

213

Non-current assets

Intangible fixed assets

Tangible fixed assets

Current assets

Stocks

Short-term pre-financing

Short-term receivables

Cash and cash equivalents (1)

Non-current liabilities

Provisions for risks and charges

Current liabilities

Provisions for risks and charges

Accounts payable

Net assets

Accumulated surplus/deficit

Economic result for the year

(1 000 euro)

2006

2005

3 053

311

34

1 169

339

12 157

17 063

3 214

213

37

1 266

174

23 665

28 569

550

205

157

15 133

15 840

3 670

– 2 448

1 222

17 062

132

24 560

24 897

3 458

213

3 671

28 568

Total assets

Total liabilities

Total net assets

Total liabilities and net assets

(1) Reimbursement of unused funds related to Tempus grants.

Source: Data supplied by the Foundation. This table summarises the data provided by the Foundation in its annual accounts: these accounts

are drawn up on an accrual basis.

19.12.2007

EN

Official Journal of the European Union

C 309/127

THE FOUNDATION’S REPLIES

ETF accepts the Court’s remark and undertakes to present
7.
distinct commitment and payment appropriation budgets. This
has already been prepared for the 2007 amended budget.

ETF takes good note of the Court’s remark and will adopt

8.
the approach proposed for all conventions in the future.