CELEX: 52012PC0782
Language: en
Date: 2012-12-19
Title: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing a Union programme to support specific activities in the field of financial reporting and auditing for the period of 2014-2020

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		52012PC0782
		
			Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing a Union programme to support specific activities in the field of financial reporting and auditing for the period of 2014-2020 /* COM/2012/0782 final - 2012/0364 (COD) */
			
				
		
		
			
			   	EXPLANATORY MEMORANDUM
1.           CONTEXT OF THE PROPOSAL
The single market is one of the European
Union's greatest achievements. Integration and a well-functioning internal
market are indispensable in making the Europe 2020 strategy successful and to
put the EU economy on a sustainable growth path in order to overcome the
financial and the subsequent sovereign debt crisis that unfolded since 2008.
As capital markets are global,
harmonisation of financial reporting and audit rules at global level is
essential for the smooth functioning of the capital markets and also for the
realization of an integrated market for financial services in the EU. Instead
of introducing its own set of regional financial reporting standards, and
thereby harmonising the EU-level legislation but adding to regional fractions
at the global level, in 2002 the EU has decided to adopt international
accounting standards (IFRS).
With more and more countries moving towards
and adopting IFRS, Europe will need more weight in the international standard
setting process for its voice to be heard. In order to be heard and listened
to, the Union has to speak with one voice. EFRAG[1],
the European Commission's technical adviser in accounting matters has gradually
taken up the role of providing upstream, technical and credible input to the
IASB's standard setting process. 
Both the international standard setter and
the organisation representing Europe's interests need to be independent,
possess the sufficient capacity and expertise to produce quality standards and
input to those standards, and have sound financial basis in order to be able to
carry out their public interest mission on a long-term basis.
To these ends, in 2009 the European
Parliament and the Council established a Community Programme to support
specific activities in the field of financial services, financial reporting and
auditing[2].
That Programme will end on 31 December 2013. The purpose of this Regulation is
to renew that Programme for the next financial framework (2014-2020) and enable
direct contributions to the funding of the Programme's beneficiaries from the Union
budget in that period. 
The original beneficiaries of the Programme
were the Committees of Supervisors[3],
the International Accounting Standards Committee Foundation (IASCF), the
European Financial Reporting Advisory Group (EFRAG) and the Public Interest
Oversight Board (PIOB). The Decision also foresaw the possibility of including
a new or replacing an old beneficiary. 
In 2010, the European Supervisory
Authorities have been set up and took over among others the responsibilities of
the previous Committees' of Supervisors. Therefore this Regulation aims at
extending the Union co-financing of the remaining beneficiaries, namely the
IFRS Foundation (legal successor of the IASCF), EFRAG and the PIOB. 
1.1.        Financial reporting: the
IFRS Foundation 
The crisis in the financial markets that
unfolded since 2007 has highlighted the importance of transparency and
consequently the issue of accounting standards rose high on the political agenda.
It became clear that a favourable business environment and a global level
playing field should be combined with transparency and comparability that are
conducive to a well-functioning global capital market. Leaders around the world
realized the key importance of a single set of high-quality, global accounting
standards.[4]

The European Union showed leadership when
it decided to adopt international accounting standards (IFRS and IFRIC) in the
Union law. According to Regulation 1606/2002 (the ‘IAS Regulation’), companies
listed in the EU have to draw up their consolidated financial reports using
international accounting standards adopted in the Union. Member States may
require or allow their use for annual accounts and/or non-listed companies. 
The financial reports of European companies
using IFRS adopted in the Union are accepted without restatement in several
capital markets around the globe – including the US, Australia and Japan. With
more and more countries adopting or converging to IFRS, progress towards the
goal of one single set of globally accepted, international accounting standards
is steady.
International accounting standards (IFRS
and IFRIC) are developed by the IASB and the IFRS Interpretation Committee. The
IFRS Foundation is an umbrella body of those organisations and cares for their
smooth functioning and proper financing. The body developing high quality
accounting standards has to be independent and needs sufficient capacity to
recruit top-quality people. To this end, it needs a solid, neutral, reliable
and calculable funding base for the long-term. 
In addition to the funding, also the
governance of the IFRS Foundation has to support the independent, credible and
proper functioning of that organisation. The governance of the Foundation has been
improved in the past years most importantly with the creation of the Monitoring
Board. That body was set up to allow for accountability and the proper
representation of public interest in the organisation. The effectiveness of the
Standards Advisory Council has been enhanced and the Due Process Oversight
Committee was set up. Further work will be needed to ensure that the IFRS Foundation
strengthens its status of high quality standard setter that is representative
of the global nature of capital markets.
To that end, by Decision 716/2009, the
European Union has shown that it is willing to provide the IFRS Foundation
(IASCF) with the necessary financial support in the form of a stable co-financing
scheme. The Union, together with certain individual Member States started to contribute
to the IFRS Foundation’s budget commensurate to its weight on the global
capital markets. The EU contribution to the IFRS Foundation's budget in the 2011
fiscal year was €4.229.165,14 (17% of the Foundation's total eligible expenses
for that year).
According to the Monitoring Board's final
report on the Review of the IFRS Foundation’s Governance[5] published on 9 February 2012,
membership in the Monitoring Board will be tied to financial contribution to
the IFRS Foundation's budget. It is therefore essential that the EU continues
to contribute to the IFRS Foundation's budget according to its global economic
weight if Europe wants to maintain its current position in the international
financial reporting arena. 
1.2.        Financial reporting: the
European Financial Reporting Advisory Group (EFRAG)
EFRAG was established in 2001 as a private
organisation to provide the European Commission with technical expertise in
financial reporting matters. At the beginning, EFRAG provided mainly advices to
the Commission on whether an international accounting standard to be adopted in
the Union meets the technical endorsement criteria[6]. EFRAG has gradually taken on
the role of pro-actively influencing the IASB in its standard setting work. It
provides input by issuing comment letters on draft standards and early-stage
contribution by publishing discussion papers on current accounting issues.
EFRAG comment letters are read and cited all around the world. 
Originally, representation and voting
rights at EFRAG's governing bodies (such as the General Assembly and the
Supervisory Board) were tied to the financial contribution to EFRAG's budget.
The body in charge of the core technical work, the TEG (Technical Expert
Group), has always been independent.
In 2008, EFRAG's governance
was thoroughly reformed in order to mirror its enhanced public policy role –
becoming a platform to form the single European accounting voice. The aim was to ensure increased public oversight and accountability. 
Two major changes were
introduced: 
·                        
The setting up of the Planning and Resource
Committee (PRC) where the early-stage pro-active work is centred – with the
participation of national standard setters; and
·                        
The strengthening the role of the Supervisory
Board: its members are no longer representatives of the funding organisations
but are appointed in their personal capacity. Members represent diverse
stakeholders – preparers (including SMEs), users and financial institutions; or
have a public policy background – and all are expected to act in the public
interest. Out of the 17 Supervisory Board members, four are so-called public
policy members: they have in particular a background in public policy making
and are nominated by the Commission. 
The TEG has remained responsible for the core
of EFRAG's technical work. Any EFRAG position on the international accounting
standards has to be discussed and approved by the TEG, which acts as an
independent technical expert committee. EFRAG's chairman chairs the TEG
meetings and EFRAG has its own secretariat (consisting of accounting
professionals). Endorsement advices to the Commission and comment letters to
the IASB form the bulk of TEG’s work. 
The majority of EFRAG’s meetings are open
to the public and the Commission services may attend as observers all EFRAG
meetings. 
The targeted governance reform in 2008
allowed EFRAG to expand its pro-active activities in cooperation with the
European National Standard Setters. Through further governance reforms to be
engaged in the coming months, EFRAG will continue to develop means to ensure
that it becomes the leading platform to form a 'single accounting voice of the
EU' and to deliver the Union's input to the IASB. For that purpose, EFRAG will
undertake a comprehensive review of its governance structure taking due account
of the most recent developments in the arena of international financial
reporting.
With more and more countries adopting IFRS,
the EU needs to take steps to prevent the gradual loss of influence and weight
at the IASB. It is therefore of vital importance that the European interests
are well-represented at international level. To this end, it is essential that
Europe ‘speaks with one voice’ which is credible and technically sound. 
EFRAG needs solid, long-term, diverse
funding to be credible and independent and be able to produce top-quality
documents by employing top-quality experts. Also, the pan-European view is
represented only if along with the big Member States, the Commission
co-finances EFRAG on behalf of the smaller MS. 
The 2010-2013 financing Programme was set
up with a view to establish a reliable funding in the long-term. On the basis
of EU financing Decision of 16 September 2009, the EU contribution to EFRAG in
the 2011 fiscal year was €2.288.160 (43% of EFRAG's total budget for that
year).
The goals of that Programme are long-term objectives;
therefore it is difficult to draw conclusions after only two full years of
financing. Based on the experiences of the financing so far, the Programme has
met its main objectives. Among others, it has allowed EFRAG to expand its
activities and engage in the pro-active work, go out to stakeholders and gather
their views at outreach events and increase its independence by taking its
chairperson on its own payroll. For more details about the experiences so far,
please refer to the Commission services' ex ante evaluation annexed to this
proposal. 
1.3.        Auditing: the Public
Interest Oversight Board (PIOB)
The Public Interest
Oversight Board (PIOB) is a non-for-profit
Spanish Foundation set up in Madrid. The key partners of the PIOB are the
Monitoring Group (MG), which is the body representing international regulators
and institutions[7],
and the International Federation of Accountants (IFAC), which is the private
body representing accountants and auditors worldwide[8]. The
PIOB consists of ten members including its Chairman. Two of the members are
nominated by the European Commission.
The PIOB members are
persons nominated by the Monitoring Group for a three-year period according to
a Memorandum of Understanding. The PIOB constituency comprises a variety of
stakeholders: legislators (e.g. the European Parliament, national legislators),
regulators and supervisors of financial markets including auditor's oversight bodies,
national standard setters for accounting and auditing, auditors and audit
profession in general, preparers of financial statements (companies), users of
financial statements (e.g. investors, analysts, researchers, suppliers),
academics.
PIOB's role is to guarantee that due
process, oversight and transparency are respected in the proposal, development
and adoption of international standard for auditors in the framework of the
International Federation of Accountants (IFAC). The Foundation is governed by a
Board of Trustees in which each member of the PIOB is a trustee.
On the basis of EU financing Decision of 16
September 2009, the EU contribution to the PIOB in 2010 fiscal year was
€286.231. Such an amount represented 22% of the PIOB's total eligible expenses
(€1.301.050). On the other hand, the EU contribution to the PIOB in 2011 fiscal
year was €288.991,78 which also represents 22% of the PIOB eligible expenses
for that year (€1.313.599).
The PIOB co-funding experience has been up
to now positive. The European Commission has had the opportunity to visit the
PIOB premises twice (March 2010 and April 2011) and to verify its financial
controls. The European Commission also trained its staff on EU budgetary
procedures. From a practical point of view the activities involved in the
management of the operating grant for the 2010 and 2011 fiscal years have been
a very useful learning experience for both sides. This has paved the way for
more efficient management of future funding contributions.
The EU co-financing of the PIOB has become
an example for other potential contributors. Currently only IFAC (around 78%)
and the EU (around 22%) co-finance the PIOB. The European Commission's efforts
are on-going to diversify the funding of the PIOB and to reinforce its
independence vis-à-vis the audit profession. Several international institutions
are expected to provide funds to the PIOB already for the 2013 fiscal year.
Moreover, the Monitoring Group, the PIOB and IFAC have created a Task Force to
select and convince a group of donors from all over the world to provide
funding to the PIOB on a stable and long-term basis.
For the EU to reduce its financial
commitment from the current level (representing 22% of the total budget) would
give the wrong message at a time when the PIOB is trying to diversify its
funding structure. But this is also extremely critical in view of our current audit
market reforms, which are aiming to increase the independence of firms, the
standard setters of international auditing standards (ISAs) as well as audit
supervisors.
2.           RESULTS OF CONSULTATIONS WITH THE INTERESTED
PARTIES AND IMPACT ASSESSMENTS
In its ex-ante evaluation accompanying the
Commission proposal for the establishment of the 2010-2013 Programme[9], the Commission assessed the
possible alternatives of funding. The objectives of the programme were to ensure
stable, diversified, sound and adequate funding and to enable the bodies
concerned to accomplish their mission in an independent and efficient manner.
It has been clearly established that Union co-financing is the most efficient
and appropriate option of reaching those objectives. 
In the ex ante evaluation accompanying the
current proposal, the Commission found that the Programme so far met the
expectations and objectives set and that financing should be continued.
Moreover, the financing Programme was set up with the aim of meeting long-term
objectives. Thus, it is appropriate to propose it being continued in the next
financial framework of 2014-2020. 
3.           LEGAL ELEMENTS OF THE PROPOSAL
3.1.        Legal
basis
The Treaty on the Functioning of the
European Union, and in particular Article 114.
In accordance with the Commission
legislative policy adopted in the framework of the Multi-Annual Financial
Framework, the present funding programme is proposed as a Regulation.
3.2.        Subsidiarity
principle
The Union programme provides for the
possibility to co-finance activities of certain bodies pursuing an objective
forming part of and supporting the Union policy in the field of financial
reporting and auditing. The proposal complies with the subsidiarity principle
since, in accordance with Article 5 of the Treaty on the European Union, its
objectives cannot be sufficiently achieved by the Member States and can, by
reason of the scale and the effect of the action, be better achieved at Union
level.
3.3.        Proportionality principle
The proposal complies with the
proportionality principle as set out in Article 5 of the Treaty on the European
Union. As assessed in the ex-ante evaluation, this Regulation does not go
beyond what is necessary in order to achieve its objectives. Union funding is
proposed for a well-defined and limited number of the most important bodies in
the field of financial services. Within the current institutional framework,
the new funding arrangements will ensure stable, diversified, sound and
adequate funding to enable the relevant bodies to carry out their Union-related
or Union public interest mission in an
independent and efficient manner. Financial support will be granted
according to the conditions laid down in Regulation (EU, Euratom) No 966/2012 of the European Parliament and
of the Council of 25 October 2012 on the financial rules applicable to the general
budget of the European Union and Commission
Delegated Regulation (EU, Euratom) No …./.. of 29 October 2012 on the rules of
application of Regulation (EU, Euratom) No 966/2012 of the European Parliament
and of the Council on the financial rules applicable to the general budget of
the Union.
4.           BUDGETARY IMPLICATION
The total amount to be borne by the Union’s
budget is EUR 58.01 million in current prices for the 2014 – 2020 period. The
Programme is a seven year programme aligned with the duration of the financial
perspectives 2014 – 2020.
2012/0364 (COD)
Proposal for a
REGULATION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL
on establishing a Union programme to
support specific activities in the field of financial reporting and auditing
for the period of 2014-2020
(Text with EEA relevance)
THE EUROPEAN PARLIAMENT AND THE
COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the
Functioning of the European Union, and in particular Article 114 thereof,
Having regard to the proposal from the
European Commission,
After transmission of the draft legislative
act to the national Parliaments,
Having regard to the opinion of the
European Economic and Social Committee[10],
Acting in accordance with the ordinary
legislative procedure,
Whereas:
(1)       Decision No 716/2009/EC of
the European Parliament and of the Council[11]
established a Community programme to support specific activities in the field
of financial services, financial reporting and auditing. On the basis of that
Decision, the European Financial Reporting Advisory Group (EFRAG), the International
Financial Reporting Standards Foundation (IFRS Foundation; the legal successor
of the International Accounting Standards Committee Foundation, IASCF) and the
Public Interest Oversight Board (PIOB) benefit from Union co-financing in the
form of operating grants until 31 December 2013. 
(2)       The crisis in the
financial markets which has unfolded since 2008 has put the issue of financial
reporting and auditing at the centre of the Union's political agenda. A
well-functioning common financial reporting framework is essential for the
internal market, for the effective functioning of the capital markets and for
the realization of the integrated market for financial services in the EU.
(3)       In a global economy, there
is a need for a global accounting language. International Financial Reporting
Standards (IFRS) developed by the International Accounting Standards Board (IASB)
are adopted and used in many jurisdictions around the world. Such international
accounting standards need to be developed under a transparent and
democratically accountable process. To ensure that the interests of the Union
are respected and that global standards are of high quality and compatible with
Union law, it is essential that the interests of the Union are adequately taken
into account in that international standard-setting process.
(4)       According to Regulation
(EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002
on the application of international accounting standards[12], IFRS should be incorporated
into Union law to be applied by companies with securities listed on a regulated
market in the Union, provided that the IFRS meet the criteria set out in that
regulation. IFRS therefore play a major role in the functioning of the internal
market and thus the Union has a direct interest in ensuring that the process
through which IFRS are developed and approved delivers standards that are
consistent with the requirements of the legal framework of the internal market.
(5)       IFRS are issued by the IASB
and related interpretations are issued by the IFRS Interpretations Committee,
two bodies within the International Financial Reporting Standards Foundation.
It is therefore important to establish appropriate funding arrangements for the
IFRS Foundation.
(6)       The European Financial
Reporting Advisory Group (EFRAG) was founded in 2001 by European organisations
representing issuers, investors and the accountancy profession involved in the
financial reporting process. In accordance with Regulation (EC) No 1606/2002,
EFRAG provides the Commission with opinions on whether an accounting standard
issued by the IASB or an interpretation issued by the IFRS Interpretations
Committee, which is to be endorsed, complies with the endorsement criteria set
out in that Regulation. EFRAG is also taking up the role of the 'single
European accounting voice' in the global arena. In that capacity, EFRAG
provides input to the IASB's standard-setting process. 
(7)       Taking into account
EFRAG's key role in supporting internal market law and policy and in
representing European interests in the standard-setting process at
international level, it is necessary for the Union to ensure EFRAG's stable
financing and thus contribute to its funding.
(8)       In the field of statutory
audit, the Public Interest Oversight Board (PIOB) was created in 2005 by
the Monitoring Group, an international organisation responsible for monitoring
the governance reform of the International Federation of Accountants (IFAC).
The role of the PIOB is to oversee the process leading to the adoption of
International Standards on Auditing (ISAs) and other public interest activities
of the IFAC. It is possible for ISAs to be adopted for their application in the
Union provided, in particular, that they have been developed with due process,
public oversight and transparency as required under Article 26 of
Directive 2006/43/EC of the European Parliament and of the Council of
17 May 2006 on statutory audits of annual accounts and consolidated
accounts[13].
The new audit proposals of 30 November 2011 also envisage the introduction of
ISAs in the EU.[14]
(9)       The introduction of ISAs
in the Union and the key role of the PIOB in ensuring that they fulfil the
requirements laid down in Directive 2006/43/EC mean that the Union has a direct
interest in ensuring that the process through which such standards are
developed and approved delivers standards that are consistent with the legal
framework of the internal market. The amended text of Article 26(3) as
indicated in Article 1 of the proposal for a Directive[15] also explicitly recognises the
role of the PIOB. It is therefore important to ensure appropriate funding
arrangements for the PIOB.
(10)     Bodies working in the field
of accounting and auditing are highly dependent on funding and play major roles
in the Union which are decisive for the functioning of the internal market. The
proposed beneficiaries of the Programme established by Decision No 716/2009/EC
have been co-financed by operating grants from the Union budget, which has
allowed them to increase their independence from private-sector and ad-hoc
funding, thereby raising their capacity and credibility. 
(11)     Experience has shown that
Union co-financing ensures that beneficiaries benefit from clear, stable,
diversified, sound and adequate funding and it contributes to enabling the
beneficiaries to accomplish their public interest mission in an independent and
efficient manner. Therefore, sufficient funding should continue to be provided
by means of a Union contribution towards the functioning of international
accounting and auditing standard‑setting, and in particular to the IFRS
Foundation, EFRAG and the PIOB.
(12)     In addition to changing
their funding patterns, the IFRS Foundation and EFRAG have undergone governance
reforms to ensure that through their structure and processes they accomplish
their public interest mission in an independent, efficient, transparent and
democratically accountable manner. In relation to the IFRS Foundation, the
Monitoring Board was created in 2009 to ensure public accountability and
oversight, the effectiveness of the Standards Advisory Council has been
enhanced, transparency has been improved and the role of impact assessments has
been formalised as part of the due process of the IASB.
(13)     For the entire duration of
the programme, a financial envelope should be laid down constituting the prime
reference, within the meaning of point [17] of the Interinstitutional Agreement
of XX/YY/201Z between the European Parliament, the Council and the Commission
on cooperation in budgetary matters and on sound financial management, for the
budgetary authority during the annual budgetary procedure.
(14)     Regulation (EU, Euratom) No
966/2012 of 25 October 2012 on the financial rules applicable to the general budget
of the Union and Commission Delegated Regulation (EU, Euratom) No …/… of
29.10.2012 on the rules of application of Regulation (EU, Euratom) No 966/2012
of the European Parliament and of the Council on the financial rules applicable
to the general budget of the Union[16], which safeguard the Union financial
interests, have to be applied taking into account the principles of simplicity
and consistency in the choice of budgetary instruments, a limitation on the
number of cases where the Commission retains direct responsibility for
implementation and management, and the required proportionality between the
level of resources and the administrative burden related to their use. 
(15)     The co-financing programme
to be established by this Regulation is expected to contribute to the
objectives of ensuring comparability and transparency of company accounts
throughout the EU, to the global harmonization of financial reporting standards
by promoting the international acceptance of IFRS and to promoting convergence
and high quality international standards for auditing in all Member States.
This programme also contributes to the Europe 2020 strategy by reinforcing the
single market of financial services and capital, and contributes to the
strategy's external dimension as well. 
(16)     This Regulation should
provide for the possibility of co-financing activities of certain bodies
pursuing an objective forming part of and supporting the Union policy in the
field of designing standards, endorsing standards or supervising
standard-setting processes related to financial reporting and auditing.
(17)     Union funding is proposed
for a well-defined and limited number of the most important bodies in the field
of financial reporting and auditing. Within the current institutional
framework, the funding arrangements should ensure stable, diversified, sound
and adequate funding to enable the relevant bodies to carry out their
Union-related or public interest mission in an independent and efficient
manner. 
(18)     Financial support should be
granted in accordance with the conditions laid down in Regulation
(EU, Euratom) No 966/2012 of the
European Parliament and of the Council of 25 October
2012 on the financial rules applicable to the general budget
of the Union and Commission Delegated
Regulation (EU, Euratom) No …/... of 29.10.2012 on the rules of application of
Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the
Council on the financial rules applicable to the general budget of the Union. The co-financing programme established by this Regulation
replaces the previous co-financing programme of the beneficiaries. Therefore,
for the sake of legal certainty, Decision 716/2009/EC should be repealed.
(19)     In order to promote the
Union's interests in the fields of financial reporting and auditing and
flexibly adapt to eventual governance and institutional changes in those
fields, the power to adopt acts in accordance with Article 290 of the Treaty on
the Functioning of the European Union should be delegated to the Commission in
respect of selecting new beneficiaries for the Programme. It is of particular
importance that the Commission carry out appropriate consultations during its
preparatory work, including at expert level. The Commission, when preparing and
drawing up delegated acts, should ensure a simultaneous, timely and appropriate
transmission of relevant documents to the European Parliament and to the
Council. 
(20)     Since
the objectives of this Regulation cannot be sufficiently achieved by the Member
States and can therefore, by reason of its scale and effects, be better
achieved at Union level, the Union may adopt measures, in accordance with the
principle of subsidiarity as set out in Article 5 of the Treaty on the European
Union. In accordance with the principle of proportionality, as set out in that
Article, this Regulation does not go beyond what is necessary in order to
achieve those objectives,
HAVE ADOPTED THIS REGULATION:
Article 1
Subject matter and scope
1.           A Union programme (the
‘Programme’) is hereby established for the period from 1 January 2014
to 31 December 2020 to support the activities of bodies which contribute to the
achievement of the policy objectives of the Union in relation to financial
reporting and auditing.
2.           The Programme covers the
activities of developing or providing input to the development of standards,
applying, assessing or monitoring standards or overseeing standard‑setting
processes in support of the implementation of Union policies in the field of
financial reporting and auditing.
Article 2
Objectives
1.           The objective of the
Programme is to improve the conditions for the functioning of the internal
market by supporting transparent and independent development of international
financial reporting and auditing standards.
2.           This objective will be
measured in particular through the number of countries using International
Financial Reporting Standards
(IFRS) and International Standards on Auditing (ISA).
Article 3
Beneficiaries of the Programme
1.           The following
beneficiaries shall benefit under the Programme: 
(a)        beneficiaries in the field of
financial reporting:
–              
the European Financial Reporting Advisory Group
(EFRAG);
–              
the International Financial Reporting Standards
Foundation (IFRS Foundation);
(b)        beneficiary in the field of
auditing: the Public Interest Oversight Board (PIOB).
2.           The Commission shall be
empowered to adopt delegated acts in accordance with Article 9 to select new
beneficiaries for the Programme and to amend paragraph 1 accordingly. 
3.           Any new beneficiary shall
be a non-profit making legal person pursuing an objective forming part of and
supporting the Union policy in the field of financial reporting and auditing
and shall be a direct successor of one of the beneficiaries listed in paragraph
1.
Article 4
Award of grants
Financing under the Programme shall be
provided in the form of operating grants. 
Article 5
Transparency
Any beneficiary of funding awarded under
the Programme shall indicate in a prominent place, such as a website, a
publication or an annual report, that it has received funding from the budget
of the European Union.
Article 6
Financial provisions
The financial envelope for the
implementation of this Regulation over the period 2014‑2020 shall be
EUR 58 010 000 in current prices. 
Article 7
Implementation of the Programme
1.           The Commission shall
implement the programme in accordance with Regulation
(EU, Euratom) No 966/2012 of the
European Parliament and of the Council of 25 October
2012 on the financial rules applicable to the general
budget of the Union. 
2.           In order to implement the
programme, the Commission shall adopt annual work programmes. They shall set
out the objectives pursued, the expected results, the method of implementation
and their total amount. They shall also contain a description of the actions to
be financed, an indication of the amount allocated to each action and an
indicative implementation timetable. They shall include for grants the
priorities, the essential evaluation criteria and the maximum rate of
co-financing.
Article 8
Protection of the financial interest of the
European Union
1.           The Commission shall take
appropriate measures ensuring that, when activities financed under this
Regulation are implemented, the financial interests of the Union are protected
through the application of preventive measures against fraud, corruption and
any other illegal activities, through effective checks and, if irregularities
are detected, through the recovery of the amounts wrongly paid and, where
appropriate, effective, proportionate and deterrent penalties.
2.           The Commission or its
representatives and the Court of Auditors shall have the power of audit, on the
basis of documents and on the spot, over all grant beneficiaries, contractors
and subcontractors who have received Union funds under the Programme. 
The European Anti-fraud Office (OLAF) may carry
out on-the-spot checks and inspections on economic operators concerned directly
or indirectly by such funding in accordance with the procedures laid down in
Regulation (Euratom, EC) No 2185/96 with a view to establishing whether there
has been fraud, corruption or any other illegal activity affecting the
financial interests of the Union in connection with a grant agreement or grant
decision or a contract concerning Union funding. 
Without prejudice to the first and second
subparagraphs, cooperation agreements with third countries and international
organisations and grant agreements and grant decisions and contracts resulting
from the implementation of this Regulation shall expressly empower the
Commission, the Court of Auditors and OLAF to conduct such audits, on-the-spot
checks and inspections.
Article 9
Exercise of the delegation
1.           The power to adopt
delegated acts is conferred on the Commission subject to the conditions laid
down in this Article. 
2.           The power to adopt
delegated acts referred to in Article 3(2) shall be conferred on
the Commission for a period of 7 years from the
date of entry into force of this Regulation. 
3.           The delegation of power
referred to in Article 3(2) may be revoked at any time by the European
Parliament or by the Council. A decision to revoke shall put an end to the
delegation of the power specified in that decision. It shall take effect the day
following the publication of the decision in the Official Journal of the
European Union or at a later date specified therein. It shall not affect the
validity of any delegated acts already in force.
4.           As soon as it adopts a
delegated act, the Commission shall notify it simultaneously to
the European Parliament and to the Council.
5.           A delegated act adopted
pursuant to Article 3(2) shall enter into force only if no objection has been
expressed either by the European Parliament or the Council within a period of
two months of notification of that act to the European Parliament and the
Council or if, before the expiry of that period,
the European Parliament and the Council have both
informed the Commission that they will not object. That period
shall be extended by two months at the initiative of the
European Parliament or of the Council.
Article 10
Evaluation
1.           No later than six months
before the end of the Programme, the Commission shall submit to the European
Parliament and the Council a report on the achievement of the Programme's
objectives. That report shall appraise at least the overall pertinence and
coherence of the Programme, the effectiveness of its execution and the overall
and individual effectiveness of the beneficiaries' work programme in terms of
achievements of the objectives as set out in Article 2.
2.           The report shall be
forwarded to the European Economic and Social Committee for information.
Article 11
Repeal
Decision 716/2009/EC shall be repealed with
effect from 1 January 2014.
Article 12
Entry into force
This Regulation shall enter into force on
the twentieth day following that of its publication in the Official Journal
of the European Union.
This Regulation shall be binding
in its entirety and directly applicable in all Member States.
Done at Brussels, 
For the European Parliament                       For
the Council
The President                                                 The
President
LEGISLATIVE FINANCIAL STATEMENT
1.           FRAMEWORK OF THE PROPOSAL/INITIATIVE
1.1.        Title of the
proposal/initiative 
Proposal for a Regulation of the European Parliament and of the
Council on establishing a Union programme to support specific activities in the
field of financial reporting and auditing for the period of 2014-2020
1.2.        Policy area(s) concerned
in the ABM/ABB structure[17] 
Policy Area: 12 Internal Market
Activity: Financial services and capital markets

1.3.        Nature of the
proposal/initiative 
¨ The
proposal/initiative relates to a new action 
¨ The
proposal/initiative relates to a new action following a pilot
project/preparatory action[18]

X The proposal/initiative relates to the
extension of an existing action 
¨ The
proposal/initiative relates to an action redirected towards a new action 
1.4.        Objectives
1.4.1.     The Commission's
multiannual strategic objective(s) targeted by the proposal/initiative 
Promote the global adoption of IFRS 
Ensure the EU's weight in influencing the formation of IFRS 
Contribute to the independence of audit standard settings' public
oversight
1.4.2.     Specific objective(s) and
ABM/ABB activity(ies) concerned 
Specific objective: To improve the conditions for the
functioning of the internal market by supporting transparent and independent
development of international financial reporting and auditing standards.
ABM/ABB activity(ies) concerned: 
12.03 Financial services and capital markets
1.4.3.     Expected result(s) and
impact
Specify the effects
which the proposal/initiative should have on the beneficiaries/groups targeted.
Increase the financial independence of the beneficiaries (IFRS
Foundation, EFRAG, PIOB)
Equip EFRAG with the necessary resources to carry out its European
public interest mission
1.4.4.     Indicators of results and
impact 
Specify the
indicators for monitoring implementation of the proposal/initiative.
 Result indicator || Latest known result || Target 
 Number of countries using IFRS || In 2012 approximately 120 countries use IFRS. || Increase by 2020 
 Percentage of standards endorsed in the EU compared to the number of standards issued by the IASB by 2020 || On 29 October 2012, 89% of IFRSs was endorsed in the EU (124 standards out of 139). || 100% by 2020   
 Number of EU countries using ISAs || As of end-2012, 20 Member States have fully endorsed the clarified ISAs || Adoption and implementation of high quality ISAs in all Member States not later than 2020 
1.5.        Grounds for the
proposal/initiative 
1.5.1.     Requirement(s) to be met in
the short or long term 
Raising the independence (also the perceived independence) of
beneficiaries in the field of financial reporting and audit to enable them to
carry out their public interest mission in a satisfactory manner
1.5.2.     Added value of EU involvement
The main goal of the programme is to ensure comparability and
transparency of company accounts throughout the EU and globally, thereby
contributing to the smooth functioning of the capital markets at EU and global
level.
The EU is the largest jurisdiction applying IFRS (Regulation
1606/2002). It is in our interest to make international accounting standards
(IFRS) the global accounting language and to ensure the EU representation at
the public oversight of the IFRS Foundation (where membership in the oversight
body will be tied to contribution to funding). 
Also significant, credible and independent technical upstream
European input is essential at the development of those standards. EFRAG is
responsible for those activities.
The EU may adopt International Standards on Auditing (ISAs) based on
Directive 2006/43. It has therefore a direct interest in ensuring that those
standards are of high quality and the due process of their adoption is subject
to independent public oversight by the PIOB.
1.5.3.     Lessons learned from
similar experiences in the past
The current financing has been successful so far in meeting the
expectations
1.5.4.     Coherence and possible
synergy with other relevant instruments
The European Commission is actively participating in the governance
reforms of the beneficiaries
1.6.        Duration and financial
impact 
X Proposal/initiative of limited
duration 
–     
X  Proposal/initiative in effect from 01/01/2014
to 31/12/2020 
–     
¨  Financial impact from YYYY to YYYY 
¨ Proposal/initiative of unlimited
duration
–     
Implementation with a start-up period from YYYY
to YYYY,
–     
followed by full-scale operation.
1.7.        Management mode(s) envisaged[19] 
X Centralised direct management
by the Commission 
¨ Centralised indirect management with the delegation of implementation tasks to:
–     
¨  executive agencies 
–     
¨  bodies set up by the Communities[20]

–     
¨  national public-sector bodies/bodies with public-service mission 
–     
¨  persons entrusted with the implementation of specific actions
pursuant to Title V of the Treaty on European Union and identified in the
relevant basic act within the meaning of Article 49 of the Financial Regulation

¨ Shared management with the Member States 
¨ Decentralised management with third countries 
¨ Joint management with international organisations (to be specified)
If more than one
management mode is indicated, please provide details in the
"Comments" section.
Comments 
2.           MANAGEMENT MEASURES 
2.1.        Monitoring and reporting
rules 
Specify frequency
and conditions.
In the case of the IFRS Foundation: interim and final reports
In the case of EFRAG: final reports and participation of the
Commission services in all committees of EFRAG
In the case of the PIOB: final reports and regular feedback to the
Monitoring Group
2.2.        Management and control
system 
2.2.1.     Risk(s) identified 
There is a risk of not achieving the operational objectives if the
quality of the beneficiaries' output is not in accordance with the initial
objectives as described in the annual proposals
There is a risk of threat to the EU financial interests/reputation
if Commission's services fail to identify ineligible expenditure
2.2.2.     Control method(s) envisaged

Risk of not achieving operational objectives:
– Beneficiaries are requested to submit an annual report, in
accordance with the individual objectives of each programme and in line with
the guidelines of Regulation (EU, Euratom) No 966/2012 of 25 October 2012, on
the financial rules applicable to the general budget of the European Union
– The operational units responsible within DG MARKT have regular
contacts with the beneficiaries and in particular, participate in all
committees of EFRAG
Risk of threat to the EU Financial interests:
– Controls of grant commitments and payments in DG MARKT follow the
reinforced financial circuit and comprise desk checks of relevant supporting
documents, including interim and final reports, audited accounts and specific
documents requested by the DG. These controls are documented in checklists that
are systematically filled in by all actors involved in the respective financial
transactions (OIA,OVA,OVA2,FIA, FVA, FVA2, AO), including controls carried out
by the DG's financial unit on financial and legal matters in order to deliver
the "Bon à Payer"
– The DG's financial unit systematically carries out on-the-spot
controls on each beneficiary with substantive testing of a sample of
transactions with an aim to assess the beneficiary's financial and internal
control system and to provide the AO with additional assurance on the sufficient
protection of the EU financial interests
The maximum error rate would remain below 2%
The cost of the controls would be around 0.5 FTE or 63.500€ per
year.
The benefit of the controls would be 100% of the annual granted
amount spent adequately and following the sound financial management principle.
2.3.        Measures to prevent fraud
and irregularities 
Specify existing or
envisaged prevention and protection measures.
Reinforced financial circuits with both an ex-ante operational and
financial verification 
Regular analysis of the beneficiaries' accounts, annual reports and
audit certificates 
On-the-spot regular audits to verify budgetary systems and controls
3.           ESTIMATED FINANCIAL IMPACT OF THE
PROPOSAL/INITIATIVE 
3.1.        Heading(s) of the
multiannual financial framework and expenditure budget line(s) affected 
·      Existing expenditure budget lines[21]
In order of
multiannual financial framework headings and budget lines.
 Heading of multiannual financial framework || Budget line || Type of expenditure || Contribution 
 Number Description || Diff./non-diff. ([22]) || from EFTA[23] countries || from candidate countries[24] || from third countries || within the meaning of Article 18(1)(aa) of the Financial Regulation 
 1 || 12.0301 Standards in the fields of financial reporting and auditing[25] || Diff || NO || NO || NO || NO 
·      New budget lines requested: N/A.
3.2.        Estimated impact on
expenditure 
3.2.1.     Summary of estimated impact
on expenditure 
EUR million in current prices (to 3 decimal places)
 Heading of multiannual financial framework: || Number:1 || Heading Smart and Inclusive Growth 
 || DG MARKT ||   ||   || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || 2021 || TOTAL 
 ||  Operational appropriations ||   ||   ||   ||   ||   ||   ||   ||   ||   
 || 12.0301 IFRS Foundation || Commitments || (1) || 4.335 || 4.422 || 4.510 || 4.600 || 4.692 || 4.786 || 4.882 || 0 || 32.227 
 || Payments || (2) || 3.251 || 4.400 || 4.488 || 4.578 || 4.669 || 4.763 || 4.858 || 1.220 || 31.007 
 || 12.0301 EFRAG || Commitments || (1a) || 3.162 || 3.225 || 3.290 || 3.356 || 3.423 || 3.491 || 3.561 || 0 || 23.508 
 || Payments || (2a) || 2.372 || 3.209 || 3.274 || 3.339 || 3.406 || 3.474 || 3.543 || 0.891 || 22.617 
 || 12.0301 PIOB || Commitments || (1a) || 0.306 || 0.312 || 0.318 || 0.325 || 0.331 || 0.338 || 0.345 || 0 || 2.275 
 || Payments[26] || (2a) || 0.000 || 0.306 || 0.312 || 0.318 || 0.325 || 0.331 || 0.338 || 0.345 || 1.930 
 || Appropriations of an administrative nature financed from the envelope for specific programmes[27] ||   ||   ||   ||   ||   ||   ||   ||   ||   
 || Number of budget line ||   || (3) || 0 || 0 || 0 || 0 || 0 || 0 || 0 ||   || 0 
 || TOTAL appropriations for DG MARKT || Commitments || =1+1a+3 || 7.803 || 7.959 || 8.118 || 8.281 || 8.446 || 8.615 || 8.788 || 0 || 58.010 
 || Payments || =2+2a+3 || 5.623 || 7.915 || 8.074 || 8.235 || 8.400 || 8.568 || 8.739 || 2.456 || 55.554 
 TOTAL operational appropriations || Commitments || (4) || 7.803 || 7.959 || 8.118 || 8.281 || 8.446 || 8.615 || 8.788 || 0 || 58.010 
 Payments || (5) || 5.623 || 7.915 || 8.074 || 8.235 || 8.400 || 8.568 || 8.739 || 2.456 || 55.554 
 TOTAL appropriations of an administrative nature financed from the envelope for specific programmes || (6) ||   || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 
 TOTAL appropriations under HEADING <1> of the multiannual financial framework || Commitments || =4+ 6 || 7.803 || 7.959 || 8.118 || 8.281 || 8.446 || 8.615 || 8.788 || 0 || 58.010 
 Payments || =5+ 6 || 5.623 || 7.915 || 8.074 || 8.235 || 8.400 || 8.568 || 8.739 || 2.456 || 55.554 
 TOTAL appropriations under HEADINGS 1 to 4 of the multiannual financial framework (Reference amount) || Commitments || =4+ 6 || 7.803 || 7.959 || 8.118 || 8.281 || 8.446 || 8.615 || 8.788 || 0 || 58.010 
 Payments || =5+ 6 || 5.623 || 7.915 || 8.074 || 8.235 || 8.400 || 8.568 || 8.739 || 2.456 || 55.554 
 Heading of multiannual financial framework: || 5 || " Administrative expenditure " 
EUR million (to 3 decimal places)
   ||   || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || TOTAL 
 DG: MARKT || 
  Human resources || 0.548 || 0.548 || 0.548 || 0.548 || 0.548 || 0.548 || 0.548 || 3.836 
  Other administrative expenditure || 0.025 || 0.025 || 0.025 || 0.025 || 0.025 || 0.025 || 0.025 || 0.175 
 TOTAL DG MARKT || Appropriations || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 4.011 
 TOTAL appropriations under HEADING 5 of the multiannual financial framework || (Total commitments = Total payments) || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 4.011 
EUR million (to 3 decimal places)
   ||   || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || TOTAL 
 TOTAL appropriations under HEADINGS 1 to 5 of the multiannual financial framework || Commitments || 8.376 || 8.532 || 8.691 || 8.854 || 9.019 || 9.188 || 9.361 || 62.021 
 Payments || 6.196 || 8.488 || 8.647 || 8.808 || 8.973 || 9.141 || 9.312 || 59.565 
3.2.2.     Estimated impact on operational
appropriations 
–     
¨  The proposal/initiative does not require the use of operational
appropriations 
–     
X  The proposal/initiative requires the use of
operational appropriations, as explained below: N/A (operating grants)
3.2.3.     Estimated impact on
appropriations of an administrative nature
3.2.3.1.  Summary 
–     
¨  The proposal/initiative does not require the use of administrative
appropriations 
–     
X The proposal/initiative requires the use of
administrative appropriations, as explained below:
EUR million (to 3
decimal places)
   || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || TOTAL 
 HEADING 5 of the multiannual financial framework ||   ||   ||   ||   ||   ||   ||   ||   
 Human resources || 0.548 || 0.548 || 0.548 || 0.548 || 0.548 || 0.548 || 0.548 || 3.836 
 Other administrative expenditure || 0.025 || 0.025 || 0.025 || 0.025 || 0.025 || 0.025 || 0.025 || 0.175 
 Subtotal HEADING 5 of the multiannual financial framework || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 4.011 
 Outside HEADING 5[28] of the multiannual financial framework ||   ||   ||   ||   ||   ||   ||   ||   
 Human resources ||   ||   ||   ||   ||   ||   ||   ||   
 Other expenditure of an administrative nature ||   ||   ||   ||   ||   ||   ||   ||   
 Subtotal outside HEADING 5 of the multiannual financial framework ||   ||   ||   ||   ||   ||   ||   ||   
 TOTAL || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 0.573 || 4.011 
3.2.3.2.  Estimated requirements of
human resources
–     
¨  The proposal/initiative does not require the use of human resources

–     
X  The proposal/initiative requires the use of
human resources, as explained below:
Estimate to be expressed in full time
equivalent units (or at most to one decimal place)
   || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 
  Establishment plan posts (officials and temporary agents) 
 XX 01 01 01 (Headquarters and Commission’s Representation Offices) || 4.125 || 4.125 || 4.125 || 4.125 || 4.125 || 4.125 || 4.125 
 XX 01 01 02 (Delegations) ||   ||   ||   ||   ||   ||   ||   
 XX 01 05 01 (Indirect research) ||   ||   ||   ||   ||   ||   ||   
 10 01 05 01 (Direct research) ||   ||   ||   ||   ||   ||   ||   
  External personnel (in Full Time Equivalent unit: FTE)[29] 
 XX 01 02 01 (CA, INT, SNE from the "global envelope") || 0.375 || 0.375 || 0.375 || 0.375 || 0.375 || 0.375 || 0.375 
 XX 01 02 02 (CA, INT, JED, LA and SNE in the delegations) ||   ||   ||   ||   ||   ||   ||   
 XX 01 04 yy [30] || - at Headquarters[31] ||   ||   ||   ||   ||   ||   ||   
 - in delegations ||   ||   ||   ||   ||   ||   ||   
 XX 01 05 02 (CA, INT, SNE - Indirect research) ||   ||   ||   ||   ||   ||   ||   
 10 01 05 02 (CA, INT, SNE - Direct research) ||   ||   ||   ||   ||   ||   ||   
 Other budget lines (specify) ||   ||   ||   ||   ||   ||   ||   
 TOTAL || 4.5 || 4.5 || 4.5 || 4.5 || 4.5 || 4.5 || 4.5 
XX is the
policy area or budget title concerned.
The human resources required
will be met by staff from the DG who are already assigned to management of the action
and/or have been redeployed within the DG, together if necessary with any
additional allocation which may be granted to the managing DG under the annual
allocation procedure and in the light of budgetary constraints.
Description of
tasks to be carried out:
 Officials and temporary agents || 5 AD and 6 AST officials, prorated on number of files dealt with. Tasks: initiating agents' tasks, verifying agents' tasks, keeping contact with the beneficiary, supervision. 
 External personnel || 1 contract agent, prorated on number of files dealt with. Tasks: recording, support the planning and preparation of missions. 
3.2.4.     Compatibility with the
multiannual financial framework 
–     
X  Proposal/initiative is compatible with the
proposal for the new multiannual financial framework 2014-2020 
–     
¨  Proposal/initiative will entail reprogramming of the relevant
heading in the multiannual financial framework.
Explain what reprogramming is required,
specifying the budget lines concerned and the corresponding amounts.
–     
¨  Proposal/initiative requires application of the flexibility
instrument or revision of the multiannual financial framework[32].
Explain what is required, specifying the
headings and budget lines concerned and the corresponding amounts.
3.2.5.     Third-party contributions 
–     
The proposal/initiative does not provide for
co-financing by third parties 
–     
The proposal/initiative provides for the
co-financing estimated below:
Appropriations in EUR million (to 3 decimal places)
   || 2014 || 2015 || 2016 || 2017 || 2018 || 2019 || 2020 || Total 
 IFRS Foundation with its own funds and with funds received from third parties (Beneficiary average co-finance 87%) || 24.873 || 27.576 || 30.278 || 32.977 || 35.674 || 38.370 || 41.064 || 230.813 
 EFRAG with its own funds and with funds received from third parties (Beneficiary average co-finance 60%) || 4.338 || 4.675 || 4.910 || 5.044 || 5.277 || 5.409 || 5.439 || 35.093 
 PIOB with its own funds and with funds received from third parties (Beneficiary average co-finance 78%) || 1.084 || 1.106 || 1.128 || 1.151 || 1.174 || 1.197 || 1.221 || 8.061 
 TOTAL appropriations co-financed || 30.295 || 33.357 || 36.316 || 39.172 || 42.126 || 44.976 || 47.724 || 273.967 
3.3.        Estimated impact on
revenue 
–     
X  Proposal/initiative has no financial impact
on revenue.
–     
¨  Proposal/initiative has the following financial impact:
–                   
¨         on own resources 
–                   
¨         on miscellaneous revenue 
[1]               European Financial Reporting and Advisory Group
[2]               Decision No 716/2009/EC of the European Parliament
and of the Council of 16 September 2009 establishing a Community programme to
support specific activities in the field of financial services, financial
reporting and auditing OJ L 253, 25.9.2009, p. 8.
[3]               CESR, CEBS, CEIOPS
[4]               Repeated calls since the 2009 London declaration;
last time in Los Cabos, 2012
[5]                        http://www.iosco.org/monitoring_board/pdf/Final%20Report%20on%20the%20Review%20of%20the%20IFRS%20Foundation's%20Governance.pdf
[6]               EFRAG is in fact the body mentioned in recital (10)
of the IAS Regulation 
[7]               The
members of the MG are: the European Commission, IOSCO (International
Organization of Securities Commissions), BCBS (Basel Committee on Banking
Supervision), IAIS (International Association of Insurance Supervisors), the
FSB (Financial Stability Board), IFIAR (International Forum of Independent
Audit Regulators) and the World Bank
[8]               The PIOB
oversees IFAC from the public interest point of view. By implication, the
following three independent committees of IFAC can also be considered PIOB
partners: the IAASB (International Auditing and Assurance Standards Board), the
IESBA (International Ethics Standards Board for Accountants) and the IAESB
(International Accounting Education Standards Board).
[9]               COM(2009) 14 final
[10]             OJ C , , p. .
[11]             OJ L 253, 25.9.2009, p. 8.
[12]             OJ L 243, 11.9.2002, p. 1.
[13]             OJ L 157, 9.6.2006, p. 87.
[14]             The amended text of Article 26 as indicated in Article
1 of the Proposal for a Directive of the European Parliament and of the Council
amending Directive 2006/43/EC on statutory audits of annual accounts and
consolidated accounts, COM(2011) 778 final and Article 20 of the Proposal for a
Regulation of the European Parliament and of the Council on specific
requirements regarding statutory audit of public-interest entities, COM(2011)
779 final
[15]             Proposal for a Directive of the European Parliament and
of the Council amending Directive 2006/43/EC on statutory audits of annual
accounts and consolidated accounts, COM(2011) 778 final
[16]             [...]
[17]             ABM: Activity-Based Management – ABB: Activity-Based
Budgeting.
[18]             As referred to in Article 49(6)(a) or (b) of the Financial
Regulation.
[19]             Details of management modes and references to the
Financial Regulation may be found on the BudgWeb site: http://www.cc.cec/budg/man/budgmanag/budgmanag_en.html
[20]             As referred to in Article 185 of the Financial
Regulation.
[21]             Budget line 12.0301 indicated below relates to new
nomenclature for MFF 2014-2020. It corresponds to the budget line 12.0401 in
MFF 2007-2013.
[22]             Diff. = Differentiated appropriations / Non-diff. =
Non-Differentiated Appropriations
[23]             EFTA: European Free Trade Association. 
[24]             Candidate countries and, where applicable, potential
candidate countries from the Western Balkans.
[25]                    The
budget line is indicative and could be changed following the annual procedure'
[26]             The payments to the PIOB will be made without
pre-payments and in a single operation the following year
[27]             Technical and/or administrative assistance and
expenditure in support of the implementation of EU programmes and/or actions
(former "BA" lines), indirect research, direct research.
[28]             Technical and/or administrative assistance and
expenditure in support of the implementation of EU programmes and/or actions
(former "BA" lines), indirect research, direct research.
[29]             CA= Contract Agent; INT= agency staff ("Intérimaire");
JED= "Jeune Expert en Délégation" (Young Experts in
Delegations); LA= Local Agent; SNE= Seconded National Expert; 
[30]             Under
the ceiling for external personnel from operational
appropriations (former "BA" lines).
[31]             Essentially for Structural Funds, European Agricultural
Fund for Rural Development (EAFRD) and European Fisheries Fund (EFF).
[32]             See points 19 and 24 of the Interinstitutional
Agreement.