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Saskia J Stuiveling President Netherlands Court of Audit

CoCoBu meeting with budgetary control committees of national parliaments on National management declarations Audit of the Netherlands’ Member State declaration. Saskia J Stuiveling President Netherlands Court of Audit. This presentation. Improving the system: audit cooperation in the EU

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Saskia J Stuiveling President Netherlands Court of Audit

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  1. CoCoBu meeting with budgetary control committees of national parliamentsonNational management declarationsAudit of the Netherlands’ Member State declaration Saskia J Stuiveling President Netherlands Court of Audit Wednesday, 19 December 2007

  2. This presentation • Improving the system: audit cooperation in the EU • Member State Declaration of the Netherlands and audit by NCA • Experiences: process and substantive issues • Conclusions and recommendations Wednesday, 19 December 2007

  3. Who wants to improve the system? • European Parliament: Clearance of Accounts 2003 – 2005 with strong call for MS declarations • European Commission: Roadmap 2004 + Action Plan 2006 ask MS SAIs for annual audits & reports to national parliaments • ECA: Single Audit Opinion 2004 + Opinion Annual Summaries and Member State declarations 2007 • National Parliaments: COSAC resolution 2005 calls for more attention to EU financial management and annual reports by MS SAIs (+ new resolution coming) Wednesday, 19 December 2007

  4. Member States’ SAIs Member States’ SAIs Member States’ SAIs Member States’ SAI EU Audit Cooperation European Court of Auditors European Commission Wednesday, 19 December 2007

  5. First Member State Declaration:the Netherlands • Common Agricultural Policy, 2006, 1.2 Bln euro. • Declaration by Minister of Finance, on the basis of sub-declaration by minister of Agriculture • Signed in Brussels, May 2007 • Declaration positive on: • functioning of systems • legality and regularity of transactions • Next (2008) declaration also on CAP (2007). From 2009 declaration also includes Structural Funds, Fisheries, Migration Funds, and contribution to Own Resources Wednesday, 19 December 2007

  6. Accountability and audit structure CAP expenditure in the Netherlands Wednesday, 19 December 2007

  7. Audit Netherlands Court of Audit • Norms derived from European legislation • Opinion on: • Preparation of the Declaration by minister of Finance (and minister of Agriculture) • Functioning of management and control systems • Legality and regularity of the underlying transactions Wednesday, 19 December 2007

  8. Opinion Netherlands Court of Audit A. Preparation declaration: broadly sound, but improvement possible: • auditors declaration covering full range of sub-declaration; • insight in criteria used by minister of Finance in judgement and reporting; B. Functioning systems: generally sound C. Legality and regularity: sound insofar as expenditure and revenu relate to public bodies. With regard to final beneficaries: • For 50% of CAP money reasonable assurance; • For 25% irregularities below tolerable threshold (1%) • For 25% (export schemes) no estimate of irregularities possible on the basis of available information Wednesday, 19 December 2007

  9. Experiences: the audit process • High political profile Declaration has effects on audit process: • High time pressure • High intensity discussions with government departments involved • Norms derived from EU-legislation, but declaration as such not mandatory. Not all government departments convinced of necessity. • Stepwise process • Open communication and good relations essential Wednesday, 19 December 2007

  10. Experiences: substantive issues (1) • Diversity within and between EU-institutions regarding information they want to receive from member states: • Different DG’s of the Commission use different reporting moments (e.g. CAP and Structural Funds) for Member State information • Annual report of ECA does not focus for all funds on same year as Annual Activity Reports of Commission. Wednesday, 19 December 2007

  11. Experiences: substantive issues (2) • Interpretation legality and regularity differs between Member States, and between EU and Member States: Degree to which statement of Member State to DG covers systems only or also legality and regularity final beneficiaries • Approach of auditing legality and regularity differs between MS SAIs, and between ECA and many MS SAIs: Certain criteria for “output” of SAIs may be needed. Working Group on Common Auditing Standards step in that direction Wednesday, 19 December 2007

  12. Conclusions and recommendations • Audited Member State declarations can become part of accountability EU, but • Some harmonisation needed before a Member State declaration can include statement on more than one policy area for the same year • Together with improved Community Internal Control Framework leading to DAS by ECA: • 1. More transparency, both EU-Wide and per Member State • 2. More legality and regularity • E.g. increase of “good governance” • More accountability  more confidence in EU Wednesday, 19 December 2007

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