Report on the annual accounts of the European Centre for Disease Prevention and Control for the financial year 2007 together with the Centre's replies
Date: 2008-09-25
Institutions: European Court of Auditors
Subjects: European Centre for Disease Prevention and Control, European Court of Auditors, administration of the Institutions, financial control, implementation of the budget, powers of the institutions (EU), report

C 311/122

EN

Official Journal of the European Union

5.12.2008

on the annual accounts of the European Centre for Disease Prevention
and Control for the financial year 2007 together with the Centre’s replies

REPORT

(2008/C 311/18)

CONTENTS

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

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

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

Paragraph

1-2

3-6

7-10

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

The Centre’s replies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

123

123

123

125

129

5.12.2008

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Official Journal of the European Union

C 311/123

INTRODUCTION

The Court has thus obtained a reasonable basis for the

6.
Statement set out below:

1.
The European Centre for Disease Prevention and Control
(hereinafter referred to as ‘the Centre’) was set up by Regulation
(EC) No 851/2004 of the European Parliament and of the Coun-
cil of 21 April 2004 (1). Its main tasks are to collect and dissemi-
nate data on the prevention and control of human diseases and
to provide scientific opinions on this subject. It is also required to
coordinate the European network of bodies operating in this field.

2.
Table 1 summarises the Centre’s competences and activi-
ties. Key data summarised from the financial statements drawn up
by the Centre for the financial year 2007 are presented in Tables 2,
3 and 4 for information purposes.

Reliability of the accounts

The Centre’s accounts for the financial year ended 31 Decem-
ber 2007 are, in all material respects, reliable.

Legality and regularity of the underlying transactions

The transactions underlying the Centre’s annual accounts,
taken as a whole, are legal and regular.

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

STATEMENT OF ASSURANCE

OBSERVATIONS

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

The Centre’s accounts for the financial year ended
4.
31 December 2007 (3) were drawn up by its Director, pursuant
to Article 23 of Regulation (EC) No 851/2004, and sent to the
Court, which is required to give a Statement of assurance 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 ISSAI (4) International Auditing Standards and Codes of Eth-
ics, in so far 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.

(1) OJ L 142, 30.4.2004, p. 1.
(2) OJ L 248, 16.9.2002, p. 1.
(3) These accounts were drawn up on 18 June 2008 and received by the

Court on 30 June 2008.

7.
The Centre’s 2007 budget amounted to 28,9 million euro,
as compared with 17,1 million euro the previous year. The bud-
get increase is mainly due to the development of the Centre’s
activities as laid down in its multiannual programme. 28,3 mil-
lion euro of the 2007 commitment appropriations were used up,
of which 16,3 million euro were paid and 12,0 million euro car-
ried over. The low level of payments is an indicator of difficulties
in implementing the 2007 activities. This low level is partly
explained by additional funds (1,8 million euro) made available
by the Commission at the end of the year. Moreover, the level of
budget amendments (5) reveals weaknesses in the monitoring of
the implementation of the budget. This situation was at odds with
the principles of annuality and specification.

8.
The inventory of fixed assets (gross amount 3,5 million
euro) was managed using a spreadsheet, which did not guarantee
the integrity of the data, and no exhaustive physical inventory of
fixed assets has been made since the Centre was set up.

9.
The Centre’s 2007 work programme is activity-based and
the initial budget follows the structure of the work programme.
However, when budget amendments were decided, no evaluation
was made of their impact on the work programme and the
achievement of the objectives.

(4) International Federation of Accountants (IFAC) and International Stan-

(5) Title I and Title III appropriations decreased respectively by 0,9

dards of Supreme Audit Institutions (ISSAI).

and 1,3 million euro to increase the Title II.

C 311/124

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Official Journal of the European Union

5.12.2008

In 2007, the Centre has disbursed 0,5 million euro on
10.
various renovation works on the building rented for its premises.
As in 2006, these works were decided by direct agreement
between the Centre and the owner without specifying the nature

of the works to be done as well as deadlines and payment condi-
tions. This situation did not comply with the Financial Regula-
tion and was at odds with the principle of economy.

This report was adopted by the Court of Auditors in Luxembourg at
24 and 25 September 2008.

its meeting of

For the Court of Auditors
Vítor Manuel da SILVA CALDEIRA
President

Area of Community competence
deriving from the Treaty

health,

A high level of human health
protection shall be ensured in
the definition and implementa-
tion of all Community policies
and
activities. Community
action, which shall comple-
ment national policies, shall be
directed towards
improving
preventing
public
human illness and diseases, and
obviating sources of danger to
human health. Such action
shall cover the fight against the
major health scourges, by pro-
moting research into their
causes, their transmission and
their prevention, as well as
health information and educa-
tion.

(Article 152 of the Treaty)

Table 1

European Centre for Disease Prevention and Control (Stockholm)

Competences of the Centre as specified in Regulation (EC) No 851/2004

Governance

Resources available to the Centre
(Data for 2006)

Products and services supplied in 2007

.

.

5
1
2
2
0
0
8

Objectives

Tasks

1. Management Board

2007 Final Budget

strengthen

Europe’s
To
defences against infectious dis-
eases; specifically, to identify,
assess and communicate cur-
rent and emerging threats to
human health from communi-
cable diseases.

— To operate dedicated dis-
ease surveillance networks
and enhance networking
activities. The Centre has a
specific role in data collec-
tion, validation, analysis
and dissemination.

Therefore the Centre shall oper-
ate dedicated surveillance net-
scientific
provide
works,
opinions, operate
early
the
warning and response system
(EWRS) and provide scientific
and technical assistance and
training.

— To provide authoritative
expert advice and scientific
opinions and studies on
communicable diseases.

— To operate the EWRS.
for
Develop procedures
emerging
identifying
health threats.

— To strengthen Member
States’ capacity in pre-
paredness planning and in
training.

— To inform the general
public and interested par-
ties of its work.

28,9 (17,1) million euro, includ-
ing a community subsidy of 98 %
and 2 % of EFTA funds

Staff Numbers

Posts in the establishment plan:
90 (50)

Posts occupied: 80 (48)

+ 42 (36) other posts

Total staff: 122 (84)

assigned to the following duties:

— operational: 75 (49)

— administrative:47 (35)

One member designated by
each MemberState,
two
members designated by the
European Parliament
and
three representatives of the
Commission.

The Board adopts the Centre’s
annual programme and bud-
get and monitors their imple-
mentation.

2. Director

Appointed by the Manage-
ment Board on the basis of a
list of candidates proposed by
the Commission.

3. Advisory Forum

A representative of
each
MemberState and three non-
voting representatives of the
Commission.

The Forum is to assure the
scientific excellence of
the
work and the independence
of the activities and opinions
of the Centre.

4. External audit

Court of Auditors.

5. Discharge authority

Parliament acting on a rec-
ommendation
the
Council.

by

— A communicable disease threat data-
base (Threat Tracking Tool, TTT) was
developed and implemented in 2007.

E
N

— ECDC completed the transfer of the
EWRS operations in 2007, and also
initiated the development of standard
operating procedures
for outbreak
investigation and response.

— Two simulation exercises were con-
ducted in 2007: test of internal proce-
dures and equipment and test of
procedures regarding risk assessment
and Member States support for contact
tracing activities.

— Launch of the European Surveillance
System in late autumn 2007, collecting
data for the DSNs migrating to ECDC.

— Publication of the First European Epi-
demiological Report and of the EU
Zoonoses Report in close collabora-
tion with membersStates and EFSA.

— Integration of the scientific journal

Eurosurveillance into ECDC.

— Organisation of five training sessions
on outbreak investigation in partner-
ship with ASPHER. Additionally, a
module on management of public
health crises was organised, gathering
senior epidemiologists from all Mem-
ber States. A training manual on
applied epidemiology was
further
developed.

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
1
1
/
1
2
5

Area of Community competence
deriving from the Treaty

Competences of the Centre as specified in Regulation (EC) No 851/2004

Governance

Resources available to the Centre
(Data for 2006)

Products and services supplied in 2007

— Influenza Pandemic Preparedness Self-
Assessment visits to all thirty EU/EEA
Member States were completed. In the
area of HIV and STI surveillance and
prevention, the Centre prepared the
ground for taking responsibility for the
surveillance of HIV/AIDS in Europe,
performed two country visits to review
programmes for prevention, control
and surveillance, and carried out
EU-wide studies to evaluate prevention
interventions. In the context of the TB
disease specific activities, an Action
Plan to fight TB in the EU was devel-
oped.

— A Scientific Consultation Group of
EU-wide Learned Societies was created.

— The first European Scientific Confer-
ence on Applied Infectious Disease Epi-
demiology (ESCAIDE) was organised
and hosted by The Centre.

Source:

Information supplied by the Centre.

C
3
1
1
/
1
2
6

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

.

.

5
1
2
2
0
0
8

European Centre for Disease Prevention and Control (Stockholm) — Implementation of the budget for the financial year 2007

Table 2

Source of revenue

Revenue

Revenue entered in the
final budget for the
financial year

Revenue received

Allocation of expenditure

Community subsidies

28 898

28 614

Title I
Staff

Title II
Administration

Title III
Operating activities

Expenditure

Final budget appropriations

(1 000 euro)

Appropriations carried over from
previous financial year(s)

entered

committed

paid

carried
over

cancelled

Available

paid

cancelled

9 598

9 528

8 825

703

70

404

330

74

6 268

5 915

3 498

2 417

353

1 620

1 505

115

13 032

12 866

3 928

8 938

166

590

5 073

7 097

3 956

5 791

1 117

1 306

Total

28 898

28 614

Total

28 898

28 309

16 251

12 058

NB: Variations in totals are due to the effects of rounding.
Source: Data supplied by the Centre. This table summarises the data supplied by the Centre in its own financial statements. Revenue collected and payments are estimated on a cash basis.

.

.

5
1
2
2
0
0
8

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
1
1
/
1
2
7

C 311/128

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Official Journal of the European Union

5.12.2008

European Centre for Disease Prevention and Control (Stockholm) — Economic outturn account
for the financial years 2007 and 2006

Table 3

(1 000 euro)

2007

2006

Operating revenue

Community subsidies

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)

26 980

26 980

8 252

612

4 395

8 699

21 958

5 022

22

4

18

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

5 040

15 806

15 806

4 536

305

2 893

2 623

10 357

5 449

0

64

– 64

5 385

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

up on an accrual basis.

European Centre for Disease Prevention and Control (Stockholm) — Balance Sheet
at 31 December 2007 and 2006

Table 4

(1 000 euro)

2007

2006

Non-current assets

Intangible assets

Tangible fixed assets

Current assets

Short-term prefinancing

Stocks

Short-term receivables

Cash and cash equivalents

Current liabilities

Provision for risks and charges

Accounts payable

Reserve

Accumulated surplus/deficit

Economic result for the year

324

2 414

461

2

787

13 420

17 408

136

5 893

6 029

Total assets

Total liabilities

Net assets

11 379

6 339

5 040

Net capital

11 379

111

936

400

7

387

7 223

9 064

70

2 655

2 725

6 339

954

5 385

6 339

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

up on an accrual basis.

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THE CENTRE’S REPLIES

As the Court noted the Centre is still in a growth phase which makes it more challenging to have high
7.
payment execution rates. Nevertheless, the management has already increased the payment execution, and has
put forward as an objective to approach 70 % of payment execution by 2010.

The Centre carefully considers the needs for budgetary amendments and is committed to further improve its
monitoring on the basis of acquired experience in order to reduce further the volume of transfers.

8.
The Centre is aware of the limited reliability of a spreadsheed based inventory register and to remedy
this, regular verifications of the data have taken place. A new asset inventory system has been developed and
is expected to be functional at the end of 2008. In addition the Logistics unit has been reinforced to track deliv-
eries and verify physically the Centre’s assets.

9.
All the transfers affecting the operational title of the budget were done in view of dynamic prioritisa-
tion of the Centre’s objectives. However, the Centre agrees with the observation and starting from 2008 it will
update its work programme together with any budgetary amendment.

10.
The Centre monitors closely the works made in order to implement the economy principle. The Cen-
tre is currently concluding on a framework agreement specifying the conditions for specific works that are to
be carried out.