REPORT FROM THE COMMISSION TO THE EUROPEAN COURT OF AUDITORS, THE COUNCIL AND THE EUROPEAN PARLIAMENT Member States' Replies to the European Court of Auditors' 2015 Annual Report
Date: 2017-02-27
Institutions: Directorate-General for Budget, European Commission
Subjects: EU Member State, European Court of Auditors, activity report, control of State aid, financial management, general budget (EU), implementation of the budget, management audit

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 27.2.2017  COM(2017) 120 final   REPORT FROM THE COMMISSION TO THE EUROPEAN COURT OF AUDITORS, THE COUNCIL AND THE EUROPEAN PARLIAMENT Member States' Replies to the European Court of Auditors' 2015 Annual Report {SWD(2017) 101 final}  
 
 
TABLE OF CONTENTS 

1. 

INTRODUCTION .............................................................................................................................. 1 

2. 

SUMMARY OF THE MEMBER STATES' REPLIES ........................................................................... 1 

2.1. ROOT CAUSES OF ERRORS, AND ACTIONS ADDRESSING ERRORS ................................................. 1 

2.2. PERFORMANCE OF THE EU BUDGET .............................................................................................. 5 

2.3. FOLLOW-UP OF THE COURT'S RECOMMENDATIONS TO MEMBER STATES ................................. 8 

3.  CONCLUSION ................................................................................................................................. 9 

ANNEX I: CONSOLIDATED RESULTS FOR ALL MEMBER STATES FOR COMMON AGRICULTURAL 
POLICY AND ECONOMIC, SOCIAL AND TERRITORIAL COHESION ...................................................... 10 

 
 
 
 
1. 

INTRODUCTION 

When  the  European  Court  of  Auditors  (the  Court)  published  its  2015  Annual  report  on  13 
October  2016,  the  Commission  in  accordance  with  the  Financial  Regulation1  immediately 
informed Member States of the details of the report which relate to the management of funds for 
which they are responsible. Member States were also invited to reply to a questionnaire focusing 
on three main themes: 

(1)  regularity  of  transactions  in  the  major  EU  spending  areas  in  shared  management  with  a 
particular focus on root causes of errors;  

(2) performance of the EU budget highlighting on the one hand links between EU priorities in the 
context  of  the  Europe  2020  strategy  for  smart,  sustainable  and  inclusive  growth  and  national 
priorities, and, on the other hand performance at project level in shared management;  

(3) follow-up of the Court's recommendations to Member States. 

This  report  provides  a  summary  of  the  Member  States'  replies.  It  is  accompanied  by  a  Staff 
Working Document (SWD), which presents the Member States' replies in more detail.  

2. 

SUMMARY OF THE MEMBER STATES' REPLIES 

2.1. ROOT CAUSES OF ERRORS, AND ACTIONS ADDRESSING ERRORS  

Member  States  were  provided  with  a  list  of  192  examples  of  main  root  causes  of  legality  and 
regularity errors in the EU expenditure and were asked to mark the extent of their relevance by 
using the categories "fully relevant", "relevant in most respect", "relevant in some respect", and 
"not relevant". The examples were based on findings made by the Court and the Commission as 
well  as  reservations  formulated  in  the  Annual  Activity  Reports  of  the  relevant  Directorates-
General of the Commission over a two-year period. 

The  consolidated  replies  for  the  Common  Agricultural  Policy  (CAP)  and  Cohesion  policy  are 
summarised in table 1, which shows the top four statements ranked by the Member States either 
as "fully relevant" or as "not relevant". An overview of the consolidated Member States' replies is 
provided in Graph 1 and Graph 2 in Annex 1. 

1 Article 162(5) of Regulation (EU, Euratom) No 966/2012.  
2 SWD, page 114. 

1 

 
 
 
 
 
 
                                                 
Table 1 – Main root causes of errors in the CAP and Cohesion policy according to MS’ replies 

Statements more frequently considered by 
Member States as "fully relevant"  

Statements more frequently considered by 
Member States as "not relevant"  

a 

  Statement  17  "Need  of  more  initiatives  for 
for 
ensuring 
beneficiaries and programmes' implementation" 
(15  MS  –  BE,  BG,  CY,  DE,  EE,  EL,  ES,  FI, 
FR, HU, LU, PT, RO, SE, UK) 

simplification 

genuine 

  Statement 1 "Number and complexity of rules 
and  gold-plating"  (9  MS  –  AT,  CZ,  DE,  EL, 
ES, FI, FR, LU, SE) 

  Statement  11  "Need  of  raising  awareness; 
targeted 
training,  and,  development  and 
delivery of detailed methodological support and 
guidance  for  national  and  regional  authorities 
and  final  beneficiaries"  (8  MS  –  BE,  BG,  CY, 
EE,  EL,  PL,  RO,  SK)  &  Statement  18 
"Knowledge  and  experience  sharing,  and 
dissemination  of  good  practices  at  national 
and/or  at  EU  level  on  improving  widespread 
weaknesses/deficiencies/errors"  (8  MS  –  BE, 
CY,  EL,  LU,  PT,  RO,  SK,  UK)    having  the 
same weight 

  Statement  12  "Need  of  more  or  better 
resources and administrative capacity building" 
(6 MS – ES, HR, IT, PT, RO, SK) 

  Statement  2 

"Incorrect 

transposition  of 
applicable EU legislation into national laws" (24 
MS  –  BE,  BG,  CY,  DE,  DK,  EE,  EL,  ES,  FI, 
FR, HR, HU, IE, IT, LT, LU, MT, NL, PT, RO, 
SE, SI, SK, UK) 

  Statement  10  "Inefficient  sanction  mechanism 
for non-compliance or low sanction rate for non-
compliance"  (21  MS  –  AT,  BG,  CY,  DE,  DK, 
EE,  EL,  ES,  FI,  FR,  IE,  LT,  LU,  MT,  NL,  PT, 
RO, SE, SI, SK, UK) 

  Statement 7 "Insufficient quality and up-date of 
the  Land  Parcel  Identification  System  (LPIS)" 
(17 MS – BE, BG, DE, DK, ES, FI, FR, HU, IE, 
LT, LU, NL, PL, SE, SI, SK, UK) 

  Statement  16  "Insufficient 

introduction  of 
changes  by  new  legal  and/or  regulatory  and/or 
to  have  a 
procedural 
significant  impact  on  the  causes  of  errors"  (16 
MS  –  AT,  BG,  CY,  DE,  DK,  EL,  ES,  FR,  IE, 
LT, LU, NL, PT, RO, SE, SK). 

frameworks 

likely 

An additional analysis per major EU spending area was also performed which confirms the trends 
of the consolidated replies, except for the following: 

  For CAP and cohesion policy, the Member States have also top ranked as "fully relevant" 
for the root causes of errors the sufficient knowledge in applying procurement and State 
aid rules, and for the CAP only – the complex eligibility rules. 

  For  cohesion  policy,  the  Member  States  have  also  top  ranked  as  "not  relevant"  for  the 

root cause of errors the better use of information to detect and correct errors. 

The Member States provided examples of actions to address the root causes of errors: 

i) 

Simplifying rules 

Several Member States, for example DE, EL, FR, HR, HU, PT, SE, UK, considered that complex 
rules,  increasing  number  of  legislation  and  jurisprudence,  legal  and  audit  differences  while 
interpreting various legal provisions and rules, excessive audit documentation and administrative 
burden,  needs  of  administrative  capacity  building,  difficulties  while  applying  exemptions  from 
general legal provisions or rules are amongst the main causes for high risks and errors in the EU 
expenditure.  

In order to remedy the situation Member States, for example CZ, DE, DK, FI, FR, LT, LU, LV, 
MT, NL, PT, SI, SK, UK, stated that they continue their simplification efforts like streamlining of 
national  eligibility  rules  to  the  bare  minimum  needed  and  not  gold-plating  the  EU  regulations, 
using  Simplified  Cost  Options,  lump  sum  grants,  use  of  indirect  costs  or  unit  costs  or  average 
costs,  introducing  a  standard  rate  for  indirect  costs  or  flat  rate  options  provided  in  the  legal 
framework and associated delegated acts. 

2 

 
 
 
 
An  example  was  provided  by  DE3  which  replied  that  'for  the  2014-2020  ESF  operational 
programme  at  federal  level,  the  settlement  system  for  five  aid  guidelines  was  successfully 
simplified,  so  that  only  personnel  expenses  and  professional  fees  are  settled  individually.  All 
other cost items, such as indirect administration and material costs, are now settled by applying a 
flat rate, on top of the personnel expenses and fees settled individually. No supporting documents 
are required for expenses settled by applying a flat rate'.  

It is worthwhile noting that overall the Member 
States  considered  the  simplification  measures 
as positive experience and good practices. 

with 

Member  States  have  gained  practical 
experience 
for 
further 
simplification. 
simplification 
in 
particular reduction of administrative burden 
and efficiency of controls at reasonable cost. 

is  needed,  considering 

opportunities 

However, 

ii) 

Further improving the systems and promoting good practices 

Member States continue their efforts in improving the systems for managing European Structural 
and Investment Funds (ESI Funds) by focusing on preventive measures and good practices in a 
wide range of areas, for instance: 

  Developing  a  procurement  implementation  plan,  establishing  a  dedicated  Procurement 

Team to provide advice, and IT systems for public procurement. 

  Carrying out management verifications and systems audits (notably in relation to public 
procurement  and State aid  rules) before payment  of EU expenditure and/or before final 
payment, if and where possible.  
Implementing actions plans, notably in relation to interruption of payment deadlines and 
suspensions,  which  address  root  causes  of  errors,  weaknesses  in  the  management  and 
control systems and deficiencies in the EU spending. 

 

  Conducting  meetings  with  beneficiaries,  stakeholders,  and  local  authorities  who  are 
major  grant  and  EU  funds  recipients  to  discuss  common  eligibility,  procurement,  State 
aid and other issues and developing best practice case studies. 

Ex  ante  conditionalities  in  the  area  of  public  procurement  and  State  aid  have  been  useful  in 
putting in place preventive measures and improving systems for the programming period 2014-
2020. 

Member  States  are  committed  to  ensuring 
functioning  management  and 
effectively 
control  systems.  However,  there  is  a  further 
need  for  better  knowledge  and  expertise, 
experience sharing and dissemination of good 
practices at EU and national level. 

iii) 

Strengthening the preventive and corrective capacity 

Several  Member  States  (e.g.  AT,  BE,  CY,  LU,  IE,  PL,  PT,  SK)  highlighted  the  importance  of 
pro-active preventive, detective and corrective measures in the CAP and cohesion policy, with a 
particular  focus  on  for  instance  continuous  training,  comprehensive  guidance  and  detailed 
checklists,  and  removal  of  conditions  that  are  difficult  to  comply  with  or  to  check.  Other 
measures include meetings between competent national and regional authorities and EU projects’ 
promoters  and  stakeholders  (notably  to  discuss  the  management  and  functioning  of  ESI  Funds, 
the  eligibility  rules,  etc.),  and  a  risk  assessment  system  making  it  possible  to  focus  checks  on 
risky  categories  of  expenditure.  For  investment  measures,  new  computerised  cross-checking  of 
ongoing  payments  and  payments  that  have  already  been  made  is  also  mentioned  along  with  an 

3 SWD, page 250. 

3 

 
 
 
 
 
 
                                                 
enhanced cross-checking of geographical information declared in the application for aid and the 
information collected during on-the-spot visits.  

Several Member States, for example CZ, LT, LV, NL, RO, SI, mentioned, in the context of CAP, 
the implementation of error action plans, which are sent regularly to the Commission. FR pointed 
out that the EAGF and EAFRD action plans contributed to managing certain risks and root causes 
of errors.  

Some  MS  emphasised  improvements  in  their  preventive  capacity  that  have  been  tailored  to  the 
programming  period  2014-2020.  For  instance,  PL4  indicated  that  for  cohesion  the  'European 
implemented  a  mechanism  of  presenting  annual  expenditure  statements 
Commission 
accompanied by a management declaration and an annual summary of final reports from audits 
and  inspections,  which  contributed  to  the  intensification  of  control  activities  prior  to  disclosing 
expenditure in annual statements'. 

Lessons  learned  have  led  to  strengthened 
preventive  and  corrective  capacity  and  better 
IT  functionalities  that  enhance  the  efficiency 
of controls. 

iv) 

Risk analysis  

Some Member States, for example BG, DE, FR, MT, NL, explained that the risk assessment and 
analysis  is  a  continuous  process  that  should  take  into  consideration  various  controls'  and  audit 
results in order to notably identify root causes of errors.  
PL5 referred to the 'ex ante assessment conducted in relation to the verifiability and controllability 
of  specific  measures  within  the  Rural  Development  Programmes  2014-2020.  It  referred  to  the 
Commission’s guidelines in the field “Verifiability and controllability of measures: Assessment 
of  risks  of  errors”.  The  assessment  took  into  account  practices,  experiences  and  control  results 
from the previous programming period'.  
CY6 replied for cohesion that 'a sampling methodology has been developed, taking into account 
the  assessment  of  the  identified  risks  and  implementing  effective,  preventive  and  proportionate 
measures to combat fraud'.  
ES7  mentioned  for  ESF  that  'a  risk  analysis  and  fraud  prevention  system  has  been  drawn 
consisting of a self-assessment instrument for identifying and addressing risks in EU expenditure 
for 2014-2020'. HU8 also pointed out that the 'managing authorities perform fraud risk assessment 
on a yearly basis in accordance with Commission's guidelines on the matter'.  

Member States considered that it is not possible 
to avoid minor errors at a reasonable cost. 

Risk  analysis  techniques  contribute  to  better 
target  controls  and  resources.  However,  it  is 
to  avoid  minor  errors  at 
not  possible 
reasonable cost. 

v) 

Relationship between basis for payment and estimated level of error in EU expenditure 

There is a wide variation in the Member States replies concerning the existence of a relationship 
between basis for payments (cost reimbursement and entitlement) and level of errors in the major 
EU spending areas. 

4 SWD, page 355. 
5 SWD, page 357. 
6 SWD, page 189. 
7 SWD, page 448. 
8 SWD, page 279. 

4 

 
 
 
 
 
                                                 
Several Member States embraced the argument that such a relationship exists. For example, IE9 
pointed out that 'the correlation between the basis for payment and the level of error is evident. In 
instances where the payment basis is more static, such as in areas where calculations are based on 
entitlements that are not subject to much variation over time, the level of error tends to be low. 
However in more complex schemes such as those which involve the submission of information 
such as invoices and receipts to form the basis of the payment, the risk or errors arising is much 
higher. The ESF experience is that the more complex the basis and rules for payment the greater 
the  risk  of  errors  being  related  to  such  payments.  However,  for  the  ERDF,  the  level  of  error 
increases whenever there is a significant delay between project implementation and certification'. 

Other  Member  States  formulated  different  positions  for  agriculture  and  cohesion  policy.  For 
example,  LV10  mentioned  that  'the  level  of  error  is  dependent  on  the  nature  of  a  project  rather 
than expenditure. Investment-type support measures entail a much higher risk of error than direct 
payment/area  payment  support  measures,  because  the  implementation  of  investment  support 
measures  is  complex,  broad-ranging  and  lengthy,  is  based  on  the  performance  of  complex, 
detailed checks and is human-resource intensive'. 

Member  States  have  quite  varying  views  on 
the  possible  relations  between  basis  for 
payments 
and 
(cost 
entitlement) and level of errors.  

reimbursement 

2.2. PERFORMANCE OF THE EU BUDGET 

Member  States  provided  examples  of  the  links  between  EU  priorities  in  the  context  of  the 
Europe 2020  strategy  (including  Horizon 2020)  and  national  priorities.  They  also  mentioned 
measures  taken  to  pursue  synergies  and  complementarities  between  ESI  Funds  and  national 
programmes. Finally, a particular emphasis was placed in the Member States’ replies on the links 
between  EU  political  priorities  and  EU-funded  projects,  as  well  as  on  related  result-oriented 
system and monitoring. 

i) 

Linking EU political priorities and national priorities  

Several MS, for example CY, CZ, EL, FR, HU, IE, LU, MT, PT, PL, SI, SK, UK, explained that 
the Partnership Agreements outline each country’s development needs and set out a summary of 
the main results expected for each selected thematic objective (translating the aims of the Europe 
2020 strategy) as requested by the EU legislation. They also concentrate resources on a limited 
number of policy areas contributing to the objectives of the Europe 2020 strategy. This focus is 
ensured  through  a  "menu"  of  eleven  thematic  objectives  directly  translating  the  aims  of  the 
Europe  2020  Strategy.  This  ensures  a  concentration  of  funding  on  key  growth  themes,  thus 
maximising the impact of EU investment. 

An important number of MS, including CZ, CY, DE, DK, EL, FR, HU, IE, LT, RO, SI, provided 
more  detailed  replies  on  R&D  programmes  and  achievements,  as  well  as  on  links  between  EU 
and national priorities, and related coherence with Horizon 2020. 
For example, IE11 pointed out that ‘national Research and Innovation priorities are set out in the 
Research  Prioritisation  (RP)  programme  which  spans  the  five  year  period  2013-2017.  The  RP 
strategy was developed over the period 2011-2012 and was strongly influenced by the emerging 
themes and structure of Horizon 2020. Therefore, the national and EU programmes are strongly 
aligned'. 

9 SWD, page 290. 
10 SWD, page 304. 
11 SWD, page 290. 

5 

 
 
 
 
 
 
 
                                                 
Member States also provided examples of synergies between  EU and national programmes. For 
instance, CY12 mentioned that 'better coordination and maximum possible synergies between  all 
the  Funds  are  achieved  mainly  through  the  work  of  the  Planning  and  Strategic  Monitoring 
Steering  Committee.  Synergies  and  complementarities  between  the  ESI  Funds  and  the  national 
programs are achieved because all actions that receive funding, either from the ESI Funds or from 
national resources are part of sectoral national strategies (e.g. digital strategy, waste management 
strategy, strategy for adaptation to climate change, etc.)'. 

Member  States  are  committed  to  increasing 
focus  on  linking  EU  political  priorities,  such 
as  Europe  2020,  Horizon  2020,  and  national 
priorities. 

ii) 

Linking EU-funded projects and EU political priorities 

Several Member States, for example DE, PT, UK, noted that the EU regulatory framework for the 
programming  period  2014-2020  required  a  link  between  EU  priorities  and  use  of  ESI  Funds. 
Targets are set out in the Partnership Agreements and the respective operational programmes for 
each  ESI  Fund.  The  Member  States,  for  example  PT,  also  mention  the  contribution  of  some 
thematic areas like R&D, employment and social inclusion to EU priorities.   
DE13 highlighted in particular that, 'the starting point of the strategy for each ERDF Operational 
Programme  is  the  increase  in  the  Bundesland's  contribution  towards  smart,  sustainable  and 
inclusive growth in Europe and to address the common concerns of ESI Fund aid. The thematic 
objectives and investment priorities set by each Land have already been linked with Europe 2020. 
Output indicators were introduced at project level. As each priority axis and thus each action is 
part of an assessment/performance system that provides for meeting specific target values such as 
result indicators, there is an automatic link with Europe 2020 objectives. That is (basically) why 
no additional measuring system has been/will be set up'. 
RO14  replied  that  'the  operational  programmes  financed  from  ESI  Funds  2014-2020  have  been 
elaborated  mainly  taking  into  account  the  targets  of  Europe  2020,  the  Country  Specific 
Recommendations, and the relevant European sectoral strategies.' 

EU  political  priorities,  such  as  Europe  2020, 
are  linked  to  EU-funded  projects  mainly 
through 
framework 
enshrined  in  Partnership  Agreements  and 
Operational Programmes. 

performance 

the 

iii) 

Result-oriented system of EU-funded projects 

Several MS, for example AT, DE IE, FR, LU, SI, SK, UK, mentioned that the result orientation 
of  programmes  and  projects  is  established  according  to  the  legal  requirements  for  the  period 
2014-2020.  They  refer  to  identification  of  sound  intervention  logic  for  each  programme  design 
fixing the specific objectives to be achieved to indicators (financial, output, result) with baseline, 
milestones  and  targets.  However,  ensuring  consistency  in  the  performance-related  terminology 
remains a challenge. 

Member  States  express  varying  views  on  the  utility  of  establishing  objectives  at  all  levels  of 
implementation.  For  instance,  CZ15  mentioned  that  'in  the  context  of  programming,  for  each 
specific objective, indicators were laid down to ensure the measurability of output and associated 
results  directly  relating  to  the  objectives  of  the  programme'  and  that  'generally,  however,  we 

12 SWD, page 191. 
13 SWD, page 253. 
14 SWD, page 402. 
15 SWD, page 204. 

6 

 
 
 
 
 
 
                                                 
prefer  to  focus  primarily  on  the  link  between  quantified  and  result  indicators  rather  than 
monitoring result indicators at project level. In view of the nature of result indicators, it is very 
often difficult to monitor and evaluate in such detail'. 
AT16 replied that for agriculture 'there is a link with national provisions and that a link at project 
level would, however, involve more bureaucracy'.  
DE17  explained  that  'the  set  of  indicators  measures  whether  the  objectives  have  been  achieved 
using  output  indicators  at  project  level  and  result  indicators  at  programme  level.  No  result 
indicators are set at project level (in accordance with the relevant legal bases). Result indicators 
show any changes to the situation and regularly measure the relative share. It is not possible to do 
this for individual projects. It is assumed that it takes a certain number of projects before changes 
become apparent and it is possible to measure them. That is why classic result indicators are only 
assessed at programme level.' 

Member  States'  mind-sets  are  changing 
towards focus on results as they make efforts 
to  introduce  performance  frameworks.  This 
ensures  that  EU  programmes  and  projects 
have an impact in many different ways and on 
levels. 
multiple 
ensuring 
consistency 
performance-related 
in 
terminology remains a challenge. 

However, 

the 

iv) 

Monitoring framework 

Overall  Member  States  put  the  monitoring  of  result-oriented  systems  in  a  larger  perspective  by 
referring  to  ex  ante  evaluations  for  the  purposes  of  preparing  partnership  agreements  and 
operational  programmes  and/or  to  other  evaluations,  studies  and  impact  assessments  that  are 
foreseen for the period 2014-2020. Their replies also highlight various references to on-going and 
regular  assessments  and  permanent  monitoring  of  the  achievement  of  general  and  specific 
objectives,  (common)  output  and  result  indicators.  Some  MS  (for  example  DE,  FR,  PL)  also 
indicated the setting of targets and milestones values for 2023. 

More  in  particular,  several  Member  States  referred  to  some  regulatory  provisions  that  would 
strengthen  the  reliability  of  data  for  monitoring  the  delivery  of  policy  objectives  in  the  period 
2014-2020, like compulsory use of common indicators with baselines, milestones and targets, and 
EU-wide uniform measurement standards. 
BE18 replied that 'the monitoring system of the operational program "Wallonia-2020.EU" aims at 
monitoring  the  achievement  of  the  objectives  and  the  targets  of  the  set  indicators.  In  addition, 
milestones have been defined in order to monitor the progress of the outcomes that will lead to 
the  achievement  of  the  objectives.  Finally,  the  Wallonia  evaluation  plan,  approved  by  the 
Monitoring Committee on 11 December 2015, foresees to carry out evaluations in order to assess 
the achievement of the objectives per axes (a particular focus on employment to be placed)'. 
FR19  indicated  that  'for  ERDF  the  monitoring  of  the  outputs  will be  carried  out  at  project  level 
while  the  monitoring  of  results  will  be  done  at  macro  level  against  the  specific  objectives  that 
should  be  achieved.  The  regulations  do  not  provide  for  monitoring  result  indicators  at  project 
level. For ESF, the monitoring of outputs and results will be done at project level'. 

16 SWD, page 124. 
17 SWD, page 254. 
18 SWD, page 132-133. 
19 SWD, page 245. 

7 

 
 
 
 
 
 
                                                 
Finally, from an organisational set-up perspective, an example from HU20 may be given with the 
'monitoring  and  evaluation  task  force,  which  monitors  indicators,  policy  indices  and  horizontal 
requirements  established  in  the  monitoring  and  information  system,  as  well  as  the  central 
monitoring  unit  which  monitors  inter  alia  the  performance  indicators  on  a  monthly  basis  in 
cooperation with managing authorities'.  

Member  States  are  reflecting  on  how  to 
monitor progress towards achieving objectives 
and  results  of  the  EU  funding  in  a  short, 
medium and long term perspective. 

2.3. FOLLOW-UP OF THE COURT'S RECOMMENDATIONS TO MEMBER STATES 

Member States almost unanimously replied that they have established systems for the follow-up 
of  Court’s  recommendations  formulated  in  its  annual  and  special  reports.  Some  Member  States 
explained  that  the  Court’s  and  the  Commission’s  recommendations  are  monitored  by  the 
competent  authorities  for  the  management  of  the  EU  funds,  including  certification  bodies  and 
audit bodies. However, follow-up processes vary: 
DK21  indicated  for  EAFRD/EAGF  that 
'since  2012  the  Danish  Agrifish  Agency  has 
systematically followed-up all recommendations from the audits. Management is informed each 
quarter  of  developments  and  can  take  appropriate  measures.  The  relevant  units  also  receive 
reports, special reports, etc. for information, even if they contain no specific recommendations for 
Denmark'.  

DE,  IE,  and  LU  noted  that  the  Court’s  recommendations  are  also  followed-up  through  various 
fora  at  EU  level  organised  by  the  Commission  or  during  structured  bilateral  meetings  with  the 
Commission.  LU  and  SE  indicated  that  the  Court’s  reports  and  the  related  Council  conclusions 
are dealt with in Council working groups. 
PT22  replied  that  'an  information  system  is  currently  being  developed.  It  will  contain  all  the 
information  on  fund-related  checks/audits  and  the  outcome  of  those  checks  and  audits.  This 
system  will  be  used  to  follow  up  on  any  recommendations  made  and  to  correct  any  detected 
errors.'  
In terms of cross-cutting follow-up at national level, DE23 mentioned that 'the relevant federal and 
regional  bodies  regularly  discuss  together  the  most  frequent  sources  of  errors  and  possible 
remedies.  This  also  includes  the  setting-up  of  thematic  federal  and  regional  working  groups  on 
the  findings  of  the  ECA  that  are  systemic  and  trans-regional  in  nature  (e.g. the  ESIF  audit 
authority’s expert group on public procurement and State aid)'.  
Finally,  AT24  mentioned  that  ‘in  principle,  no  recommendations  are  made  to  specific  Member 
States  in  the  ECA's  Annual  or  Special  Reports.  Descriptions  of  findings  tend  to  remain  very 
general  and  are  often  not  aimed  at  a  specific  Member  State  or  even  a  particular  programme  or 
project. This makes follow-up more difficult. In any event, for the ERDF, appropriate follow-up 
is given to the individual findings established during the audits’. 

Member States are committed to follow up the 
Court’s recommendations but wide variations 
in the follow-up systems and processes exist. 

20 SWD, page 283-284. 
21 SWD, page 215. 
22 SWD, page 386. 
23 SWD, page 255. 
24 SWD, page 126. 

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3. 

CONCLUSION 

The  Commission  is  committed  to  continue  working  closely  with  the  Member  States  towards 
lower levels of error, improved financial management and value added of the EU budget. 

Member  States  demonstrate  in  their  replies  that  they  are  aware  of  the  main  root  causes  of  the 
errors and are committed to continue working to ensure effectively functioning management and 
control  systems.  Member  States  address  root  causes  of  errors  by  using  various  simplification 
opportunities and strengthening their preventive and corrective capacity, notably on the basis of 
lessons  learned,  enhanced  IT  technologies,  data  mining  tools,  and  risk  management  techniques. 
Member  States  also  implement  action  plans,  if  needed,  on  which  they  regularly  report  to  the 
Commission.  Ex  ante  conditionalities,  particularly  in  the  areas  of  public  procurement  and  State 
aid,  have  also  been  used  for  preventive  measures  and  improving  systems  for  the  programming 
period 2014-2020. 

The  replies  confirm  that  Member  States  apply  a  multiannual  control  and  audit  cycle,  and  that 
corrective measures can be implemented until the closure of the programming period. In relation 
to this, Poland25 emphasised that 'the annual error rate calculated by the Court of Auditors should 
be  considered  in  the  context  of  the  multi-annual  character  of  EU  interventions  (including  net 
financial  corrections  and  amounts  recovered)  '.  Member  States  also  considered  that  it  is  not 
possible to avoid minor errors at reasonable costs. 

Member  States  are  committed  to  ensuring  a  link  between  EU  political  priorities  of  smart, 
sustainable  and  inclusive  growth  and  national  priorities.  Their  replies  show  that  they  take  into 
consideration EU priorities when identifying national policy orientations, steering developments, 
and implementing national measures, e.g. in line with Country Specific Recommendations. 

The replies of this year show that EU political priorities are linked to EU-funded projects mainly 
through  the  performance  framework  enshrined  in  the  Partnership  Agreements  and  Operational 
Programmes agreed between the Commission and the Member States. Member States' mind-sets 
are  changing  towards  focus  on  results  as  they  make  efforts  and  dedicate  resources  to  the 
introduction  of  a  framework  of  overarching  objectives,  specific  objectives,  and  operational 
objectives. This ensures that EU programmes and projects have an impact in many different ways 
and  on  multiple  levels.  However,  ensuring  consistency  in  the  performance-related  terminology 
remains a challenge. Therefore, focus on performance of the EU budget should continue.  

Finally,  Member  States  are  committed  to  follow-up  the  Court’s  recommendations  but  wide 
variations in the follow-up systems and processes exist. 

25 SWD, page 469. 

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ANNEX  I:  CONSOLIDATED  RESULTS  FOR  ALL  MEMBER  STATES  FOR  COMMON  AGRICULTURAL  POLICY  AND  ECONOMIC,  SOCIAL  AND 
TERRITORIAL COHESION 

Graph 1 – Main root causes in the major EU spending areas sorted by "Fully relevant" 

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Graph 2 – Main root causes in the major EU spending areas sorted by "Not relevant" 

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