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The assurance model for the 2007-2013

programming period – How is the Commission building

up its assurance ?

The assurance model for the 2007-2013

programming period – How is the Commission building

up its assurance ? Caroline Callens Deputy Head of Unit J.1: Coordination,

Relations with the Court of Auditors and OLAF

DG Regional Policy

“Train the trainers” seminar

17 June 2010

Caroline Callens Deputy Head of Unit J.1: Coordination,

Relations with the Court of Auditors and OLAF

DG Regional Policy

“Train the trainers” seminar

17 June 2010

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Contents of the presentation

• Assurance model • Division of responsibility: Commission versus Member

State• Authorities involved in the management of structural

funds (MA, CA, AA and Commission)• Overview of guidance notes for the AA, MA and CA• Overview of guidance notes on horizontal issues

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Assurance model

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Assurances prior to reimbursement of expenditure – ex ante • Assurance obtained during the programme

negotiations• Ex ante assessment of the compliance of the

design of the management and control systems

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Assurance during implementation and Assurance during implementation and at closureat closure• First level verifications (by the Managing

Authority)• Certification of expenditure + information

irregularities (by the Certifying Authority)• Audit work by the Audit Authority• Audit work by the Commission

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Division of responsibility (1/2)

• Commission supervisory role– Satisfies itself that “set up” is compliant– Verifying effective functioning– Using powers of interrupting and suspension of

payments– Making financial corrections

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Division of responsibility (2/2)

• Member State responsible for:– Set up of a management and control system

which complies with requirements of regulations– Ensuring that systems function effectively - i.e.

certification reliable– Preventing, detecting, correcting irregularities

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Authorities designated

• For each programme:– Managing Authority (MA)– Certifying Authority (CA)– Audit Authority (AA)– Body to receive payments from Commission and

disburse to beneficiaries (can be MA or CA)

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Managing Authority (1/2)

• Responsibility for implementing the programme, in particular for:– Selection of operations– Desk and on-spot verifications of operations– Compliance with information and publicity

requirements– Ensuring the audit trail (levels: MA/intermediate

body and beneficiary)Art. 60 Council Regulation

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Managing Authority (2/2)

• Other responsibilities– To inform beneficiaries of all conditions for funding,

including the time limit for execution– To satisfy itself (before grant approval) that beneficiary

has capacity to fulfil conditions– Administrative verifications on ALL payment requests– On-spot verifications, possibly on a sample basis– Written standards and proper recording of checksArt. 13 Implementation Regulation

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Certifying Authority (1/3)• Function: to draw up and submit to Commission

certified expenditure statements and payment requests• Certification of expenditure with regard to:

– accuracy of data; must be based on reliable accounting system and verifiable supporting documents

– compliance with EU and national rules

Art. 61 of C.R. and 20 Implementation Regulation

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Certifying authority (2/3)• How does CA satisfy itself that data are accurate and

that all conditions for certification are fulfilled?– Examination of information received from MA on

verifications carried out to expenditure– CA’s own checks, including audit trail at level

MA/intermediate body and possible sample checks of project files

– Audit reports of AA for systems audits and project audits and Annual Control Report and opinion

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Certifying authority (3/3)

• Maintaining computerized accounting records• Keeping accounts of amounts recoverable and amounts

recovered Art. 61 of C.R.

• Sending to Commission annual reports on amounts recoverable, recovered and withdrawn following cancellation

Art. 20 Implementation Regulation

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Audit authority (1/2)Audit authority (1/2)• The designation of the audit authority - > an important

innovation for the 2007-2013 programming period • The AA has overall responsibility for all audit work in the

MS • The AA plays a key role in providing assurance to the

Commission on the functioning of the management and control systems during implementation -> system audits and audits of operations

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Audit authority (2/2)Audit authority (2/2)• The results of its audit work are reported through the

ACR and AO -> opinion on effective functioning of certification and management verification functions

• The ACR and AO are assessed by the Commission • The ACR and AO are taken into account for the Annual

Activity Report of DG REGIO/DG EMPL which is audited by ECA (discharge procedure)

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The Commission’s audit work (1/2) • Objective: to obtain assurance that the MCS

have been set up in conformity with the Regulations and function well.

• Commission services will carry out audits to verify the functioning of the new systems and they will review the ACR and AO

• Audit work is coordinated between DG REGIO and DG EMPL

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The Commission’s audit work (2/2)

• Primarily focus on verifying the reliability of the audit work of the AA in line with the concept of the single audit approach

• Also own systems audits + testing of operations

• Art 73 (2) and (3)• Interruption and suspension of payments

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Legal framework • Council Regulation

– Art. 58-62: Management and control systems – Art. 70-74: Responsibilities of Member States and

Commission, compliance assessment procedure, proportionality

– Art. 98-102: Financial correction procedures• Commission Regulation

– Art. 12-25 Management and control systems– Art. 27-36 Reporting of irregularities

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Guidance notes related to the MA and CA• Guidance document on the functions of the

Certifying Authorities• Guidance document on management

verifications• Brochure on eligibility • Self assessment tool for MA• Etc…

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Guidance notes directly addressed to the AA

• Guidance note on Compliance Assessment• Guidance note on Audit Strategy• Common methodology for the assessment of the MCS• Sampling methods• Guidance note on Annual Control Report and Annual Opinion• Guidance note on the concept Reliance on the work of other

audit bodies• Information note on simplified costs, etc…

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Horizontal topics

• Guidance note on Partial closure• Guidance note on Annual Summary• Information note on Fraud Indicators• Etc…

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Guidance notes

• All guidance can be found on CIRCA- COCOF group

http://circa.europa.eu

…soon to be found also on SFC 2007

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Thank you for your attention!Thank you for your attention!

Caroline.Callens@ec.europa.euCaroline.Callens@ec.europa.euTel: +32-2-299 39 27Tel: +32-2-299 39 27