Report on the financial statements of the European Foundation for the Improvement of Living and Working Conditions (Dublin Foundation) for the financial year ended 31 December 1998, together with the Foundation's replies
C 372/38 EN Official Journal of the European Communities 22. 12. 1999 on the financial statements of the European Foundation for the Improvement of Living and Working Conditions (Dublin Foundation) for the financial year ended 31 December 1998, together with the Foundationís replies REPORT (1999/C 372/07) CONTENTS Paragraph reference OPINION OF THE COURT. 1-4 MAIN OBSERVATIONS CONCERNING THE IMPLEMENTATION OF THE BUDGET OF THE EUROPEAN FOUNDATION FOR THE IMPROVEMENT OF LIVING AND WORKING CONDITIONS (DUBLIN FOUNDATION) FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 1998. Administration. Implementation of the Financial Regulation. Imprest account. Balance sheet. Sundry expenditure to be charged. Translation section. 5-10 5-6 5 6 7 7 8 Missions. 9-10 Tables 1 and 2. The Foundationís replies. Page 39 39 39 39 39 39 39 39 39 41 43 22. 12. 1999 EN Official Journal of the European Communities C 372/39 OPINION OF THE COURT 1. This report is addressed to the Council and the European Par- liament in accordance with Article 16 of Regulation (EEC) No 1365/75 (1), as amended by Article 1(4) of Regulation (EEC) No 1947/93 (2). 2. The Court has examined the financial statements of the European Foundation for the Improvement of Living and Work- ing Conditions for the financial year ended 31 December 1998. In accordance with Article 1(16) of Council Regulation (EEC) No 1949/93 (3) amending Regulation (EEC) No 1417/76 (4), the bud- get was implemented under the responsibility of the Administra- tive Board. This responsibility included the drawing up and pre- sentation of the financial statements (5) in accordance with the internal financial provisions provided for under Article 1(52), (54) and (55) of Council Regulation (EEC) No 1949/93 amending Regulation (EEC) No 1417/76. The Court of Auditors is required under Article 248 of the Treaty establishing the European Com- munity to examine these accounts. 3. The Court undertook its audit in accordance with its audit policies and standards. These have been adapted from generally accepted international auditing standards to reflect the specific characteristics of the Community context. Accordingly, the Court carried out such tests of the accounting records and other proce- dures as it deemed necessary in the circumstances. Through the audit, the Court obtained a reasonable basis for the opinion expressed below. 4. This examination has allowed the Court to obtain reasonable assurance that the accounts for financial year ended 31 December 1998 are reliable and that the underlying transactions are, taken as a whole, legal and regular. MAIN OBSERVATIONS CONCERNING THE IMPLEMENTATION OF THE BUDGET OF THE EUROPEAN FOUNDATION FOR THE IMPROVEMENT OF LIVING AND WORKING CONDITIONS (DUBLIN FOUNDATION) FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 1998 Administration Implementation of the Financial Regulation 5. The present version of the áimplementation of the Financial Regulationí dates from 1976 and is in need of revision to reflect (1) OJ L 139, 30. 5. 1975, p. 1. (2) OJ L 181, 23. 7. 1993, p. 13. (3) OJ L 181, 23. 7. 1993, p. 26. (4) OJ L 164, 24. 6. 1976, p. 1. (5) As required under Article 16 of Council Regulation (EEC) No 1365/75 as amended by Regulation (EEC) No 1947/93, the accounts for all the Foundationís revenue and expenditure in respect of the financial year 1998 were drawn up on 26 March 1999 and forwarded to the Com- mission, the Foundationís Management Board and the Court of Audi- tors. These accounts were received by the Court on 21 May 1999, a summarised version of these financial statements is presented in the tables attached to this report. current practice and developments in accounting. The Founda- tion should update the implementing provisions to take account of recent developments in the use of information technology and the introduction of the euro. The implementing provisions also need to address: entries in the inventory, regulations concerning an Advisory Committee on Procurements and Contracts (ACPC), delegation of powers and management of the imprest accounts. Imprest account 6. Expenditure through the imprest account amounted to 37 % of total expenditure, salaries excluded. To assist management and control of the imprest account, additional explanatory informa- tion could be provided by the imprest holder. As soon as the new SI 2 budgetary system is installed, only a small number of transac- tions should be processed via the imprest account. Balance sheet Sundry expenditure to be charged 7. The balance on the sundry expenditure account as at 31 December 1998 amounted to ECU 38 875. This comprises two parts: an amount of ECU 37 611 brought forward in the balance sheet for the financial year 1997, and ECU 1 264 relating to 1998. The balance brought forward relates to amounts paid in 1997 when there were insufficient funds in the budget line. The amounts were charged to a suspense account in the balance sheet to be regularised in 1998: that is to be approved by the Financial Con- troller and charged against the correct budget line. The amounts were not regularised in 1998. The amount relating to 1998 refers to similar payments made during this year. The total amount on this balance sheet item should be regularised in 1999. Translation section 8. With regard to the development of the Translation Centre for bodies of the European Union in Luxembourg, the situation of the translation section in the Foundation should be reviewed. Missions 9. To assist the management of mission expenses, mission sta- tistics should be prepared in a way which makes it possible to allocate the cost per head, and per unit. C 372/40 EN Official Journal of the European Communities 22. 12. 1999 10. Mission expenses of experts should, as a rule, be paid to their institution. If they are paid to the expert, original travel tickets and boarding cards should be stamped ápaid by the European Founda- tion. í before being copied as annex to the expenses form. This report was adopted by the Court of Auditors in Luxembourg at its meeting of 9 September 1999. For the Court of Auditors Jan O. KARLSSON President 22. 12. 1999 EN Official Journal of the European Communities C 372/41 Table 1 Balance sheet as at 31 December 1998 and 1997 (ECU 1 000) Assets 1998 1997 Liabilities 1998 1997 Fixed assets Buildings Equipment and furniture 7 106 1 777 7 106 1 705 Fixed capital Own capital Balance for the financial year Balance from previous financial years 8 927 - 2 148 8 838 - 24 - 2 328 Subtotal 8 883 8 811 Subtotal 6 779 6 486 Stocks 44 27 Current assets Amounts recoverable from EU bodies Miscellaneous advances Recoverable VAT Sundry accounts receivable Cash accounts Bank - demand accounts Imprest account 2 155 5 276 37 Subtotal 2 473 2 353 12 2 365 Subtotal 14 1 281 36 332 2 809 168 2 977 Suspense account Sundry expenditure to be charged 39 37 Current liabilities Automatic carry-overs of appropriations EU bodies account Social liabilities VAT Sundry accounts receivable Payments in progress Suspense account Sums to be reused 3 220 2 155 276 37 1 098 6 786 239 239 3 364 14 43 281 36 1 743 5 481 217 217 Subtotal Subtotal Source: Prepared by the Court of Auditors on the basis of data from the Foundation. Total assets 13 804 12 184 Total liabilities 13 804 12 184 C 372/42 EN Official Journal of the European Communities 22. 12. 1999 Revenue and expenditure account for the financial years 1998 and 1997 Table 2 (ECU 1 000) 1998 1997 Revenue Subsidy received from the Commission Miscellaneous revenue Revenue from services rendered against payment Expenditure Staff expenditure - Title I of the budget Payments Appropriations carried over Operating expenditure - Title III of the budget Payments Appropriations carried over Out-turn for the financial year Balance carried over from previous financial years Amount received from the Commission Buildings, equipment and miscellaneous administrative expenditure - Title II of the budget Payments Appropriations carried over 11 262 156 30 Total revenue 11 448 13 451 146 49 13 646 6 617 7 898 145 2 954 3 212 13 833 - 187 159 4 - 24 6 676 78 797 223 2 893 2 919 - 2 138 - 2 352 2 352 60 - 70 Total expenditure 13 586 Appropriations carried over from the previous financial year which lapse Exchange rate differences Source: Prepared by the Court of Auditors on the basis of data from the Foundation. Balance for the financial year - 2 148 22. 12. 1999 EN Official Journal of the European Communities C 372/43 DUBLIN FOUNDATION S REPLIES Implementation of the Financial Regulation Translation section 5. Arrangements have been made for the up-dating of the imple- menting rules for the Financial Regulation. The revised version will incorporate the issues addressed by the Court. 8. A review of the language and translation services of the Foun- dation is in hand. Imprest account 6. Additional explanatory information will in the future be pro- vided in relation to expenditure from the imprest account. Missions Balance sheet Sundry expenditure to be charged 9. The Foundation will re-examine its method of preparing mis- sion statistics in order to determine how best to address the rec- ommendation of the Court, having regard to the limited staff resources available. 7. The amounts in the balance sheet for the year 1998 referred to by the Court have now been regularised. The Foundation has taken appropriate measures to prevent a recurrence of this prob- lem. 10. Travel tickets and boarding cards are now stamped ápaid by the European Foundationí