Presentation on theme: "1 Management verifications Michael Ryan Axel Badrichani"— Presentation transcript:
1 Management verifications Michael Ryan Axel Badrichani European Union Cohesion Policy Train the trainers European Commission seminar for managing and certifying authorities 9 June 2009
2 Commission guidance note –Issued in June 2008 –To assist managing authorities (MA) and intermediate bodies (IB)
3 Background One of the 7 Key Requirements related to the MA – see EC guidance on systems evaluation issued in June 2008 This key requirement was further developed into 28 questions in the self assessment tool sent to the MAs.
4 Legal basis - Council regulation Article 60 of Regulation (EC) N°1083/2006 details the functions of the managing authority Art. 60 (b) part 1: The managing authority (MA) shall be responsible (…) for verifying that the co- financed products and services are delivered and that the expenditure declared by the beneficiaries for operations has actually been incurred and complies with Community and national rules (…).
5 Legal basis-Implementing rules Article 13 (2) of Regulation (EC) N° 1828/2006: Sets out scope: The verifications (…) shall cover administrative, financial, technical and physical aspects of operations, as appropriate.
6 Legal basis-Implementing rules Article 13 (2) of Regulation (EC) N°1828/2006: Verifications shall ensure that the expenditure declared is real, that the products or services have been delivered in accordance with the approval decision, that the applications for reimbursement by the beneficiary are correct and that the operations and expenditure comply with Community and national rules. They shall include procedures to avoid double-financing of expenditure with other Community or national schemes and with other programming periods.
7 Legal basis-Implementing rules Article 13 (2) of Regulation (EC) N°1828/2006: Verifications shall include the following procedures: (a) administrative verifications in respect of each application for reimbursement by beneficiaries (b) on-the-spot verifications of individual operations
8 Legal basis-Implementing rules Article 13(3) of Regulation (EC) N°1828/2006: Where on-the-spot verifications (…) are carried out on a sample basis (…) the managing authority shall keep records describing and justifying the sampling method and identifying the operations or transactions selected for verification.
9 Menu Legal basis What are management verifications ? Types of verifications (Admin / on the spot) How much should be done ? Intensity Efficient and effective verifications
10 What are management verifications ? Day to day management checks to ensure the legality and regularity of the expenditure Verification of the administrative, financial, technical and physical aspects of operations Verification of compliance with Community and national rules
11 Compliance with Community and national rules Section 3 of guidance note Public Procurement Environment State aid schemes State aid Financial engineering instruments Revenue generating projects Durability of operations Equality and non-discrimination
12 Types of verifications Administrative verifications On the spot verifications
13 Administrative verifications Desk-based documentary verifications of ALL of payment claims (interim & final) Examination of supporting documentation (list of) payments / invoices – audit trail lists of participants and timesheets (ESF) Examination of progress reports WHEN ? - Before declaring expenditure to level above and before certification of expenditure to Commission by CA
14 Administrative verifications Aim to verify (inter alia): –Correctness of claim –Expenditure declared is within eligible period –Expenditure complies with grant decision –Existence of adequate audit trail –Compliance with eligibility rules, publicity requirements, public procurement
15 On the spot verifications Aim to verify (inter alia): –Reality of operations (incl. costs) –Delivery of products or services in accordance with terms of reference –Physical progress as reported –Technical and physical aspects of operation –Administrative capacity of beneficiary –Compliance with publicity requirements –Existence of adequate audit trail
16 On the spot verifications - Intensity Intensity depends on –Nature of operation (tangible/ intangible) –Sampling - risk oriented, complemented by random sample –Amount and type of documentation available for desk based checks –Computerised management information system
17 Documenting verifications Use Checklists Record sampling methodology Checks carried out and documentation reviewed (Short) written report of on the spot verification
18 Efficient & effective verifications Efficient only if grant decision / contract absolutely clear : clear definition of operation, expected outputs, financing plan, eligibility rules, administrative (reporting) obligations of beneficiary… Training for verification staff on : risk factors, methodology, legal and accounting principles, eligibility rules…
19 KEY POINTS FOR MANAGING AUTHORITIES
20 KEY POINTS Day to day checks to ensure the eligibility of expenditure and compliance with Community and national rules Balance between administrative and on the spot checks Need to understand and assess the specific programme risks Develop a strategy for managing risks. This is the reference point for intensity of verifications Develop a preventive approach by providing information and advice to beneficiaries and training for those carrying out verifications Document verifications
21 KEY POINTS MAs are recommended to carry out a self assessment (see self assessment tool) Will allow the MA to detect the areas which need to be strengthened and to take the appropriate remedial actions Presentation 2008 webstream manauth/programme_en.htm (Session min. on) manauth/programme_en.htm