1. “Train the trainers” seminar
The assurance model for the 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

2. 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

3. Assurance model

4. 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

5. Assurance during implementation and at 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

6. 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

7. 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

8. 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)

9. 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

10. 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 checks
Art. 13 Implementation Regulation

11. 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

12. 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

13. 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

14. Audit authority (1/2)
The designation of the audit authority - > an important innovation for the 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

15. 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)

16. 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

17. 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

18. Legal framework Council Regulation Commission Regulation
Art : Management and control systems
Art : Responsibilities of Member States and Commission, compliance assessment procedure, proportionality
Art : Financial correction procedures
Commission Regulation
Art Management and control systems
Art Reporting of irregularities

19. 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…

20. 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…

21. Horizontal topics Guidance note on Partial closure
Guidance note on Annual Summary
Information note on Fraud Indicators
Etc…

22. Guidance notes http://circa.europa.eu
All guidance can be found on CIRCA- COCOF group
…soon to be found also on SFC 2007

23. Thank you for your attention!
Tel: