Winding-up Declaration and Audit Requirements at the Closure of INTERREG III programmes (2000-2006) Directorate General Regional Policy Audit and Control Claude Tournier Brussels, 28 April 2008. Agenda Closure of INTERREG II 1994-1999 – Lessons learned Closure of INTERREG III 2000-2006
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Winding-up Declaration and Audit Requirements at the Closure of INTERREG III programmes (2000-2006)Directorate General Regional Policy Audit and ControlClaude TournierBrussels, 28 April 2008
Closure of INTERREG II 1994-1999 – Lessons learned
Closure of INTERREG III 2000-2006
- Winding-up declaration
- Audit Requirements
- Guidance note on closure of INTERREG III
Questions and Answers
Bad news: What were the main problems?
Closure of INTERREG II Lessons learned1/2
Projects were paid late - 51 programmes not closed today, of which 7 INTERREG II programmes.
Closure of INTERREG II Lessons learned2/2
1994 - 1999
INTERREG III is "mono-fund“: only one DG involved in the process
Closure of INTERREG III Calendar 1/1
2000 - 2006
The winding-up declaration has to be sent together with the final implementation report and the final payment request in order to get the final payment.
Article 32(4) of Regulation (EC) No 1260/99
sets as a condition of payment of the final balance for a programme the submission by the Member State of the winding-up declaration.
Regulation EC No 438/2001 – Art. 15 -16-17 + Annex III (model)
Regulation EC No 1260/1999 – Art. 38 1, f)
Closure of INTERREG III Winding-up declaration 1/2
The Winding-up Body has to prove that is has obtained assurance on expenditure declared for the whole programming period and area based on conclusions of all previous checks carried out
Art. 38 1, f of Regulation EC No 1260/1999
"This declaration shall summarise the conclusions of the checks carried out during previous years and shall assess the validity of the application for payment of the final balance and the legality and regularity of the transactions covered by the final certificate of expenditure.“
The person or department signing the winding-up declaration takes a responsibility towards the Commission: "I certify…"
The declaration covers expenditure of 7 +2 years: be careful i) to be informed, and ii) on the quality of written documentationClosure of INTERREG III Winding-up declaration 2/2
Article 10-12 of Regulation EC No 438/2001 checks.
These articles lay down the basic audit requirements to be filled and of which conclusions have to be drawn before the winding-up declaration can be signed.Closure of INTERREG III Audit Requirements1/4
Regulation EC No 438/2001 – Art. 10
"Member States shall organise checks on operations on an appropriate sample designed in particular to
a) verify the effectiveness of the management and control systems in place;
b) verify selectively, on the basis of risk analysis, expenditure declarations made at the various levels concerned."
The checks shall cover at least 5% of the total eligible expenditure and be based on a representative sample of the operations approved.Closure of INTERREG III Audit Requirements2/4
Article 11 of Regulation EC No 438/2001
"Through the checks, the Member States shall endeavour to verify" inter alia:
approved and execution of works;
(Art. 12 of 1260/1999)
Interpretation: Communication of the Commission of 23.06.2006
The verification of payments to final beneficiaries may include correct payments from lead partners to partners.
Awards of public contracts need be checked in depth even if values concerned are below the EU Directives thresholdsClosure of INTERREG III Audit Requirements3/4
Article 12 of Regulation EC No 438/2001
"The checks shall establish whether any problems encountered are of a systemic character."
Detected systemic errors should result in preventive action and/or financial correctionsClosure of INTERREG III Audit Requirements4/4
Decision of the Commission adopted on 1 August 2006 (COM(2006)3424 final of 1/08/2006): Guidelines on closure of assistance (2000-2006) from the Structural Funds
Control activities between participating regions or Member states have to be coordinatedClosure of INTERREG IIIGuidance Note 1/7
"A single winding-up declaration should be submitted by programme, and there is no exception to this rule when two or more Member States are involved in a programme.“
Coordinate and use of the same cut-off date!Closure of INTERREG IIIGuidance Note 3/7
"The Managing Authority has to ensure that the management checks cover all operations in the whole programming area. This can be achieved by the intervention of national controllers or intermediate bodies or by outsourcing the control tasks. In such cases, independence from project partners and qualification of the intervening bodies has to be ensured.“
In case of outsourced Article 4 checks, a complete analysis of the detected findings is necessary and if applicable, financial corrections have to be done.Closure of INTERREG IIIGuidance Note 4/7
The Paying Authority has to “ensure that there is sufficient information from the Managing Authority or intermediate bodies to be able to certify the accuracy, eligibility and regularity of the amounts declared. This should include precise information on how the Managing Authority complies with its control duties under Article 4 of Regulation (EC) No 438/01 in the whole programming area.“
It has to “satisfy itself through its own checks covering operations in the whole programming area, including where appropriate the review of the work of a subsidiary paying authority.
The Paying Authority ensures itself that it gets sufficient information from the Managing Authority. It is up to itself to decide what kind of information it needs to issue the declaration of expenses.Closure of INTERREG IIIGuidance Note 5/7
The Paying Authority has to “satisfy itself that all errors/irregularities have been satisfactorily treated and findings and recommendations of audits fully implemented, which requires that the Paying Authority is fully informed about the way the controls in the different participating regions are performed and about their results.“
List of irregularities and reconciliation with OLAF lists by Member state.Closure of INTERREG IIIGuidance Note 6/7
"This declaration must be signed by the body(ies) designated following Article 15 of Regulation (EC) No 438/01, after having made all necessary enquiries to obtain reasonable assurance that the certified statement of expenditure is correct and that the underlying transactions are legal and regular.“
It is NOT sufficient to carry out a control for completeness and obvious inconsistencies! If necessary, substantive controls, including content and quality checks, have to be carried out.Closure of INTERREG IIIGuidance Note 7/7
Article 1 of Regulation (EC) 2035/2005
"Irregularities (…) shall be reported by the Member State in which the expenditure was incurred. The Member State shall at the same time inform the managing authority and the paying authority for the programme and the person or body designated to establish declarations on winding-up under Article 15 of Regulation (EC) No 438/2001.”
Letter DG REGIO Mr Ahner 22 January 2007 (00550-460010
Questions & Answers