Tuesday, November 13

Imprison the EU Commissioners for Fraud

Well, if you were running a public company spending hundreds of billions of Euro's and for thirteen years, your auditors were refusing to sign off on your accounts stating that your accounts were not fit for purpose, full of fraud and corruption, you would be chucked into jail, no? You would not swan around in expensive suits, be photographed in the media shaking hands with the great and good, no?

No, well, here's the European Commission which is full of crooks. Nobody is responsible and this is the organisation that Gordon Brown wants us to sign up to without a referendum?

Crooks and Thives! I quote:

A report by the European Court of Auditors (ECA) criticises nearly every major area of the EU's expenditure.
According to the auditors, the commission has failed to maintain effective supervision of expenditure on major infrastructure projects, the BBC's Jonny Dymond in Brussels says.
In all, nearly 80% of the EU's 106bn-a-year euro budget (£75bn) fails the auditors test.

And I dont care that it is because of complex technical requirements. Public companies manage to do this. And if the EC cant manage its own accounts, then how on earth is it managing the EU? the mind boggles at the sheer stupidity of the excuses that these morons put forth.

All this to be taken with a grain of piquant salt!!!


Anonymous said...

that's very piquant salt indeed...
what are the facts?
1)the EU accounts are 'true and fair' - that's what the Court says in its report; in other words if the Commission were a public company, its accounts would most probably be signed off by the auditors, as companies are only audited for their books
2)besides the accounts, the EU auditors also check whether the individual transactions were carried out in line with all the rules and procedures - there are millions of such transactions a year (e.g. payments to farmers and other individual beneficiaries), so errors will happen; however, errors are not equal to financial loss - money can be clawed back or they may not have a financial impact; you'll find more information here (see the press kit in news in focus): http://ec.europa.eu/budget/index_en.htm
greetings (with a pinch of salt) from Brussels

Unknown said...

Dear Anomymous, thank you for the comment, but I stand by my note. I quote from the court's own report which I accessed here.


Opinion on the reliability of the accounts
VII. In the Court’s opinion, except for the effects of the matters described in
paragraph VIII, the ‘Final annual accounts of the European Communities’ present
fairly, in all material respects, the financial position of the Communities as of 31
December 2006, and the results of their operations and cash flows for the year then
ended, in accordance with the provisions of the Financial Regulation and the
accounting rules adopted by the Commission’s accounting officer.
VIII. The Court’s audit has identified errors in amounts registered in the
accounting system as invoices/cost statements and pre-financing which have the effect
of overstating the accounts payable by some 201 million euro and the total amount of
long and short term pre-financing by some 656 million euro.

Note: even if you consider that the errors have been decreasing, average over 13 years, you will get about 15-20 billion euro's worth of errors, even if you exclude fraud!, and nobody has been held responsible. So according to you, an error of a billion euros per year is acceptable? Well, it is NOT. I am a taxpayer and I demand improvements in your public service. Disgraceful!

but lets move on!

page 15
XII. In the Court’s opinion, in the other areas of expenditure payments are still
materially affected by errors, although to different levels, and the Commission and
the Member and other beneficiary states need to make further efforts to implement
adequate supervisory and control systems, so as to improve the handling of the
attendant risks. These areas are listed below, namely: Common agricultural policy,
Structural measures, Internal policies and External actions.

(a) In CAP expenditure, the Court found a marked reduction in the estimated overall
level of error in underlying transactions. However, it still remains just above the
materiality threshold. Clearance systems and post payment checks for CAP
subsidies not covered by IACS provide limited assurance as to compliance with
Community legislation. Furthermore, claims for EU aid are not usually checked
on the spot by the independent bodies in charge of the certification of the
accounts of paying agencies.
(b) In Structural measures, the Court found that control systems in the Member States
are generally ineffective or moderately effective, and that the Commission
maintains only a moderately effective supervision to mitigate the risk that the
control systems in the Member States fail to prevent overstated or ineligible
expenditure. Therefore, the reimbursement of expenditure to Structural Policies
projects is subject to material error.
(c) In Internal policies the Court’s audit revealed that the supervisory and control
systems do not sufficiently mitigate the inherent risk of the reimbursement of
overstated costs, resulting in a material level of error in payments to beneficiaries.
(d) In External actions, despite the improvements of the Commission’s supervisory
and control systems, a material level of error was detected at the level of implementing
organisations, due to continued weaknesses in the systems designed to
ensure the legality and regularity of transactions at this level.

You want more?

how about page 20?
1.15. The Commission’s Accounting Officer was not able to provide validation to the local
systems of the EuropeAid Co-operation Office (17), Directorate-General for Education and
Culture (18) and the Directorate-General for External Relations (19) regarding the financial year
2006. Furthermore, the number and importance of issues and matters for further consideration
remains much the same as for the final validation report of the financial year 2005 (20).

In other words, sweet sod all has been done over 1 year despite pointing it out!

And you want to recover costs? ha!, how can you even recover costs when your systems dont even know how much has been paid out, controls are unknown and procedures are followed in the breach?

And why on earth would a reputable organisation like the BBC say this?

EU accounts failed for 13th year

The EU's accounts have failed to receive a clean bill of health
The auditors for the EU have refused to sign off the bloc's financial accounts - for the 13th year in a row.

If you havent done fraud, can you fire the guys for incompetence?

Anonymous said...

thanks for placing the report here; it says clearly: '(...)Final annual accounts of the European Communities’ present fairly, in all material respects, the financial position of the Communities...'; the qualifications mentioned in VIII amount to 0.13% of the value of EU's operating expenses in 2006 - if a public company had a similar result, they would certainly be proud, as this is way beyond the materiality level (which is 2%).

The real problems exist in transactions, not accounts. It may not be a good excuse, but any public institution involved in payouts en masse will face the issue of errors in individual payments, be it the EU, the USA or the UK (your pensions authority has had its accounts qualified for 18 years).

As to incompetence, the Commission is taking steps to limit the scope for errors in payments: it has recently suspended EUR 1.7 billion (!) to the UK because of the weaknesses it found in the UK control systems.