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

C 309/116

EN

Official Journal of the European Union

19.12.2007

REPORT

on the annual accounts of the European Foundation for the Improvement
of Living and Working Conditions for the financial year 2006 together
with the Foundation’s replies

(2007/C 309/20)

CONTENTS

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

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

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

Paragraph

1-2

3-6

7-9

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

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

Page

117

117

117

118

121

19.12.2007

EN

Official Journal of the European Union

C 309/117

INTRODUCTION

The Court has thus obtained a reasonable basis for the

6.
Statement set out below.

1.
The European Foundation for the Improvement of Living
and Working Conditions (hereinafter referred to as ‘the Founda-
tion’) was set up by Council Regulation (EEC) No 1365/75 of
26 May 1975 (1). Its aim is to contribute to the planning and
establishment of better living and working conditions in the Euro-
pean Union by increasing and disseminating knowledge which is
relevant to this subject.

Reliability of the accounts

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

2.
Table 1 summarises the Foundation’s competences and
activities. 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.

Legality and regularity of the underlying transactions

transactions underlying the Foundation’s

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

annual

STATEMENT OF ASSURANCE

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

3.
This Statement of Assurance is addressed to the European
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 Director, pursuant
to Article 16 of Council Regulation (EEC) No 1365/75, and sent
to the Court, which is required to provide a statement on their
reliability and on the legality and regularity of the underlying
transactions.

5.
The Court conducted its audit in accordance with the IFAC
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.

OBSERVATIONS

7.
The implementation rate for 2006 commitment appro-
priations was more than 97 %. Carryover rates were 43 % for
administrative expenditure (Title II) and 45 % for operating activi-
ties (Title III). Thus, the budgetary principle of annuality was not
strictly observed.

At the year-end 2006, the Foundation signed two con-
8.
tracts for services to be rendered in 2007 for a total value of
305 987 euro. These contracts were covered by 2006 commit-
ment appropriations from Title II — Administrative expenditure.
Despite the fact that the above contracts related to services to be
rendered exclusively in 2007, they were not charged to the bud-
get of the related financial year.

9.
For recruitment procedures the selection criteria were nei-
ther decided by selection boards at the outset nor defined in con-
formity with the vacancy notice. This did not ensure transparent
and non-discriminatory procedures.

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 139, 30.5.1975, p. 1.
(2) OJ L 248, 16.9.2002, p. 1.
(3) These accounts were drawn up on 15 May 2007 and received by the

Court on 3 July 2007.

Table 1

European Foundation for the Improvement of Living and Working Conditions (Dublin)

Areas of Community competence
deriving from the Treaty

Competences of the Foundation as defined in Council Regulation (EEC)
No 1365/75 of 26 May 1975; amended by Council Regulation (EC)
No 1111/2005 of 24 June 2005

Governance

Resources available
to the Foundation
(2005 data)

Activities and services provided

Objectives

Tasks

1. The Governing Board (GB)

Final budget for 2006

Monitoring and surveys

as

their

‘The Community and the Mem-
ber States, having in mind fun-
damental social rights, … shall
have
objectives…
improved living and working
conditions, … the Community
shall support and complement
the activities of
the Member
States in the following fields; …
b) working conditions; c) social
security and the social protec-
tion of workers; d) protection of
workers where their employ-
ment contract is terminated; e)
the information and consulta-
tion of workers; f) representa-
tion and the collective defence
of the interests of workers and
employers,
including
co-determination; g) conditions
of
third-
country nationals; h) the inte-
gration of persons excluded
from the labour market; i) equal-
ity between men and women…’

employment

for

The aim of the Foundation shall
be to contribute to the establish-
ment of better living and work-
ing conditions by increasing and
disseminating knowledge which
is relevant to this subject. In par-
ticular, it is required to consider
the following areas:

— man at work,

— organisation of work and
particularly job design,

— problems peculiar to cer-
tain categories of workers,

— long-term aspects of the
improvement of the envi-
ronment,

— to foster

the exchange
of information and experi-
ence in these fields,

— to

con-
facilitate
tact between universities,
study and research insti-
tutes,
and
economic
social administrations and
organisations,

— to carry out studies or to
conclude study contracts
and
assis-
to provide
tance for pilot projects,

— to cooperate as closely as
possible with existing spe-
cialised institutes in the
Member States
and at
international level.

(Articles 136 and 137 of
Treaty)

the

— the distribution of human
activities in space and in
time.

— from each Member State: 1 govern-
ment representative, 1 representative
from employers’ organisations and 1
workers’ representative,

— 3 representatives from the Commis-

sion.

2. The Bureau of the GB

— consists of 11 members; 3 members
from each of the social partners and
the governments, 2 from the Com-
mission,

— it monitors the implementation of
decisions of the GB and takes mea-
sures to ensure proper management
between GB meetings.

3. The Director is appointed by the
Commission from a list of candidates sub-
mitted by the GB, he implements the deci-
sions of the GB and the Bureau of the GB
and manages the Foundation.

4. The Advisory Committees are com-
posed of up to 3 members from the Com-
mission, governments and the
social
partners, with the aim of advising on the
implementation of major projects and the
assessment of results.

5. External audit

The Court of Auditors.

6. Discharge given by the Parliament on
a recommendation by the Council.

19,8 million euro (19,3)

Including a Community subsidy
of: 98,9 % (98,8%)

Staff in December 2006

94 (94) posts provided for in the
establishment plan; Posts occu-
pied: 89 (82)

— Establishment of one Network of European Obser-
vatories (NEO) covering the former three networks
attached to the European Industrial Relations
Observatory (EIRO), the European Working Condi-
tions Observatory
Euro-
(EWCO)
pean Restructuring Monitor (ERM),

and

the

— Fourth Working Conditions Survey: first results,

Other staff:

— First Company Survey: first results.

Seconded National Experts and
employment-agency staff: 1 (12)

Employment and restructuring

Contract staff: 9 (3)

— Studies on the Food & Beverage sector and Knowl-

Total staff employed: 99 (94)

edge Intensive Businesses Services,

assigned to the following tasks:

— Geographical and Labour Market Mobility in

— operational: 58 (54)

— administrative: 32 (32)

— mixed: 4 (5)

Europe: report,

— Attractive Workplaces for All: a contribution to the

Lisbon Strategy at company level,

— Labour Supply in Care Services: report.

Work-life balance and Working Conditions

— Fourth Working Conditions Survey,

— 15 years of European working surveys: trend report,

— Measuring Job Satisfaction in surveys,

— Working-time reports based on the Company sur-

vey.

Industrial Relations (IR) and Partnership

— Working Time and Pay Developments,

— European Works Councils: reports and case studies,

— IR Country Profiles,

— Capacity Building for Social Dialogue: reports on

New Member States and Turkey.

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Areas of Community competence
deriving from the Treaty

Competences of the Foundation as defined in Council Regulation (EEC)
No 1365/75 of 26 May 1975; amended by Council Regulation (EC)
No 1111/2005 of 24 June 2005

Governance

Resources available
to the Foundation
(2005 data)

Activities and services provided

Social Cohesion and Quality of Life

— EurLIFE database updates,

— Ageing Workforce and Age Management: reports

and case studies,

— Employment guidance services for people with dis-

abilities.

Communication and sharing ideas and experience

— 332 publications, 53 press releases, 40 % increase
in web use, 16 % increase of press cuttings

— Promotion campaigns ‘Your work, your life; balance
company needs with worker satisfaction’ and
‘Fourth Working Conditions survey: what workers
say’,

— Foundation Forum 2006 ‘Competitive Europe,

Social Europe — Partners or Rivals?’

— Company Network Seminars

— Foundation Seminar Series ‘Flexicurity and Employ-

ability’

— National Outreach Centres covering AU, BE, ES, FI,

FR, HU, IT, LUX, SP, UK,

— Exhibitions at Employment week in Brussels and at

the PES conference in Oporto.

Source:

Information supplied by the Foundation.

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European Foundation for the Improvement of Living and Working Conditions (Dublin) — Implementation of the budget for the financial year 2006

Table 2

Source of revenue

Revenue

Revenue entered
in the final budget
for the financial year

Revenue collected

Allocation of expenditure

Community subsidy

19 000

Other subsidies

Other revenue

540

220

Total

19 760

19 000

241

265

19 506

Title I
Staff (NDA)

Title II
Administration (NDA)

Title III
Operating activities (NDA)

(1 000 euro)

Expenditure

Appropriations for the financial year

entered

committed

paid

9 931

9 894

9 774

1 530

1 463

862

8 299

7 860

4 612

Total

19 760

19 217

15 248

carried
over

120

634

3 558

4 312

Appropriations carried over from
previous financial year

cancelled

available

paid

cancelled

37

34

129

200

157

507

152

482

3 954

4 618

3 713

4 347

5

24

241

270

Source: Data supplied by the Foundation — This table summarises the data supplied by the Foundation in its annual accounts. Revenue collected and payments are estimated on a cash basis.

European Foundation for the Improvement of Living and Working Conditions (Dublin)
— Economic outturn account for the financial years 2006 and 2005

European Foundation for the Improvement of Living and Working Conditions (Dublin)
— Balance sheet at 31 December 2006 and 2005

Table 3

Table 4

Operating revenue
Community subsidies
Other subsidies
Other revenue

Operating expenses
Staff expenses
Fixed asset related expenses (1)
Other administrative expenses
Operational expenses

Total (a)

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

Financial operations revenue (e)
Financial operations expenses (f)

Surplus/(deficit) from non-operating activities (g = e – f)
Economic result for the year (h = c + g)

(1)

Increase due to corrections following a physical inventory done in 2006.

(1 000 euro)

2006

2005

19 000
517
248
19 765

8 908
724
2 106
7 409
19 147
618
—

10
– 10
608

18 600
—
366
18 966

8 035
576
2 117
8 581
19 309
– 343
—

9
– 9
– 352

Non-current assets
Intangible fixed assets
Tangible fixed assets
Current assets
Short-term pre-financing
Short-term receivables
Cash and cash equivalents

Current liabilities
Provisions for risks and charges
Accounts payable

Net assets
Accumulated surplus/deficit
Economic result for the year

Total assets

Total liabilities

Total net assets
Total liabilities and net assets

(1 000 euro)

2006

2005

84
2 388

344
690
3 111
6 617

274
1 643
1 917

4 093
608
4 701
6 618

22
2 778

539
505
3 244
7 088

189
2 806
2 995

4 445
– 352
4 093
7 088

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.

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19.12.2007

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Official Journal of the European Union

C 309/121

THE FOUNDATION’S REPLIES

Measures will be taken to reduce significantly the carry-
7.
over rate for Title II in 2007. Taking into account the average
duration of our study contracts (18 months) and our payments
schedule, unavoidably about 35 % of Title 3 credits had to be car-
ried over.

8.
Due to the fact that the mentioned contracts had to
start on 1 January 2007 and that the budget 2007 was not yet

established at the time, the mentioned services had to be commit-
ted at the latest in December 2006. However, from 2007 onwards
they will be committed against the appropriations of the follow-
ing year.

Since March 2007, all vacancy notices include a clear indi-
9.
cation of whether success in tests is a precondition for success in
the competition.