7 November 2006VI Eurosai Training Event - Prague1 Auditing EU funds – National SAI experiences...

7 November 2006VI Eurosai Training Event - Prague1

Auditing EU funds – National SAI experiences

Jan van den Bos –

Netherlands Court of Audit


Contents

• Background and present situation

• The Dutch experience

• General overview

• Conclusion


Background

and

Present Situation


Developments in EU financial management since 2000

• Unchanged negative opinion of ECA on EU

financial management

• Reform of the Commission

• Single Audit opinion of ECA

• Critical Discharge resolutions of EP

• Commission Roadmap

• Action Plan


General framework (1)

European Court of Auditors (ECA)

• external auditor of the EU accounts

• audits the European Commission

• also audits in the Member States

National SAIs (25)

• audit how their Member States carry out their responsibilities

• also how they implement their EU obligations (including spend and collect EU funds)


General Framework (2)

Co-operation among EU SAIs

• National SAIs assist the ECA with their audit missions in the Member States

• Discuss matters of common interest in the Contact Committee of the Heads of EU SAIs / at the meetings of Liaison Officers

• Carrying out common activities in the CC Working Groups


National SAIs and EU audit work• National SAIs can differ greatly in the activities

they undertake

• Much depends on:- the constitutional position of the SAI- the mandate of the SAI- size of the institution

• Reflected in work carried out (financial, compliance, performance audits and certification work)

• Capability/willingness to carry out overall national SAI reports


EU audits published in 2005Country Number of public reports by EU policy sector in 2005

Agricul-ture

Structural measures

Internal policy

Other (incl.pre-

accession)Overarching/

multiple sectorsTotal2005

Total 2004

Austria 4 - 1 - - 5 7

Belgium 1 - 1 1 1 4 1

Cyprus - - 6 - - 6 0

Czech Republic - 1 2 1 1 5 3

Denmark - - - - 2 2 5

Germany - - - 1 - 1 5

Estonia - - - - 2 2 3

Finland 1 - - - - 1 6

France - - - - - 0 2

Greece - 3 - - - 3 3

Hungary 1 - 1 1 3 6 2

Ireland - - - - - 0 0

Italy - - - - 2 2 1

Latvia - 1 - - - 1 4

Lithuania 1 2 1 - 4 8 3

Luxembourg - - - - - 0 0

Malta 1 - 1 - - 2 0

Netherlands - 1 1 - 1 3 3

Poland 1 1 1 3 - 6 4

Portugal - 5 - - 1 6 9

Slovak Republic 2 2 - - 3 7 3

Slovenia - - - - - 0 1

Spain - - - - - 0 0

Sweden - - 1 - 2 3 2

United Kingdom - - - - 2 2 4

TOTAL 12 16 16 7 24 75 71


Some general remarks

• Almost all national SAIs publish results of EU

audits annually

• All sectors of EU policy are covered in the

audit work of national SAIs

• Some SAIs focus more on particular sectors

than others:

- Austria on agriculture

- Portugal and Greece on structural measures

(among others the Cohesion Fund)

- Cyprus on internal policy


Type of EU audits published on

• Financial audits (26) - mostly in new Member States

(especially Cyprus, Lithuania, Slovak Republic and

Hungary - due to certification/winding-up audit activities)

• Compliance audits (19) - usually focus on the set

up/functioning of management and control systems -

carried out by 12 national SAIs

• Performance audits (22) - focus on the execution/results of

EU policy (especially Poland, Hungary, Czech Republic

and Sweden)

• Hybrid audits (8) - not easily categorized - often more

descriptive overall national SAI reports (6 cases)


The Dutch experience


1970s/1980s

• Financial/compliance auditing of EC

agricultural spending in the Netherlands

• Part of our annual regularity audit

(for those funds included in the national

accounts)


1990s

• EU became and integral part of the audit

strategy of the NCA

• NCA started carrying out specific performance

audits in the EU field

(with increasing focus on the structural funds)


1995 - The Watershed

• Increased interest in Dutch Parliament for EU

affairs

• Request by Public Accounts Committee to

make an inventory of management and control

systems of EU funds

• Increased auditing of individual EU funds

(compliance/performance type)

• Inventory updated three years later


Since 1999

• The NCA has further developed its EU strategy

• It aims at assisting in

- Getting the Netherlands’ household up to

standards, with respect to collecting and

spending EU-money

- Upgrading EU financial management in EU

as a whole

• Key project to achieve both strategic goals:

the EU Trend Report


EU Trend Report (1)

• Three Parts:

1) EU Institutions

2) Member State comparisons

3) The Netherlands

• Part 1 and 2: based only on publicly available information; Part 3: includes own audit results as well.

• Use of Indicators: to assess regularity and system quality


EU Trend Report (2)

Present state of affairs

• Development of indicators

• Information coming from DG Budget on

EU expenditure in individual Member States

• More information from EU SAIs is becoming

available/collected


Member State assurance statement (1)

• Dutch government has decided to show that it

is possible to give the EC better accountability

reporting on the management of EU funds (will

be sent to both Dutch Parliament and the EC)

• Regularity up to the level of the final

beneficiaries will be included

• If the EC/ECA are satisfied with the assurance

given by the MS the audit intensity by them is

expected to drop


Member State assurance statement (2)

• NCA has been asked to give an opinion on the

statement for Dutch Parliament

• Could fit into annual regularity audit that the

NCA does on the State accounts


General Overview


EU activities of national SAIs (1)

• More and more SAIs are publishing overall

national SAI reports:

- 4 (Denmark, Italy, Netherlands and UK) in

2004 and

- 8/9 (the above, Belgium, Estonia, Hungary, Slovenia and possibly Austria) in 2007


EU activities of national SAIs (2)

• 7 other SAIs have separate EU sections in

their annual (audit) reports (Finland, France,

Latvia, Lithuania, Malta, Portugal and the

Slovak Republic)

• 3 SAIs are working together with their national

authorities to develop MS declarations

(Denmark, Netherlands and UK)


Conclusion


Development

• The role of national SAIs in the audit of EU funds

has become broadly accepted

- by the Member States

- by the EU institutions

• In the future a more structural role of the national

SAI in assisting its Member State to give the EU

and its citizens better assurance seems probable

7 November 2006VI Eurosai Training Event - Prague1 Auditing EU funds – National SAI experiences...

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