CHAPTER 3 — Principles and structure, amending budgets, transfers and carryovers of appropriations
Budgetary principles
1. The budget, drawn up in euro, is the act which for each financial year lays down and authorises all the revenue and expenditure administered by the Facility.
2. The appropriations entered in the budget are authorised for the duration of a financial year which begins on 1 January and ends on 31 December of the same year. They shall include commitment and payment appropriations.
3. The commitment appropriations entered in the budget shall be authorised within the limit of the annual financial ceilings set out in Annex I. However, provided that the overall ceiling referred to in Article 2(1) is respected, the Committee may adopt, where necessary or in exceptional circumstances, an annual or amending budget exceeding the respective annual financial ceiling by up to 15 %. In such case, the High Representative may submit to the Council a proposal to adjust the annual ceilings set out in Annex I, taking into account first any unused part of the ceilings for previous years.
4. Budget revenue and expenditure shall be in balance.
5. All expenditure shall be linked to a specific operation or assistance measure except where necessary for the costs listed in Annexes II and III.
6. No revenue or expenditure may be implemented other than by allocation to a title in the budget and within the limit of the appropriations entered there, except pursuant to Article 51(2) and (6) and Article 58.
Annual budget
1. The annual budget shall consist of commitment and payment appropriations classified into titles which shall be subdivided into chapters and articles.
2. Every year, in preparation of the draft budget for the following financial year, each administrator shall draw up the titles for which he or she is responsible pursuant to Article 12(1) and (2), on the basis of the estimated needs, within the limit of the corresponding annual financial ceiling set out in Annex I. Operation commanders shall assist the administrator for operations.
3. The draft budget shall include:
(a)
the appropriations deemed necessary to cover:
—
the common costs for ongoing or planned operations,
—
the costs of assistance measures established or to be approved by the Council;
(b)
a general part to cover the support and preparatory expenditure on operations, as referred to in Annexes II and III, which is not linked to a specific operation;
(c)
a general part to cover the support and preparatory expenditure on assistance measures, as referred to in Annexes II and III, which is not linked to a specific assistance measure;
(d)
a forecast of the revenue needed to cover expenditure.
4. A specific title shall be dedicated to each operation or assistance measure referred to in point (a) of paragraph 3 and to each of the general parts for support and preparatory expenditure on operations and assistance measures. Where part of an assistance measure is implemented by an operation, a specific title shall be dedicated to that part of the measure, under the responsibility of the administrator for operations, and separate from the title for the common costs of the operation.
5. Support and preparatory expenditure that is common to both operations and assistance measures shall be attributed to each general part according to the percentages that the titles for operations and the titles for assistance measures represent in the initial annual budget of the Facility adopted by the Committee pursuant to Article 11(4).
6. Each title may include a chapter entitled ‘provisional appropriations’. These appropriations shall be entered where there is uncertainty, based on serious grounds, about the amount of appropriations needed or the scope for implementing the appropriations entered.
7. Revenue, subdivided by title, shall consist of:
(a)
contributions payable by the contributing Member States and, where appropriate, by contributing third States;
(b)
miscellaneous revenue, which includes:
—
the budget outturn from the previous financial year as decided by the Committee,
—
interest received and revenue from sales,
—
recoveries of funds unspent during implementation.
8. The administrators shall propose the draft annual budget to the Committee by 30 September at the latest. The Committee shall adopt the budget by 30 November. The administrators shall notify the Member States and contributing third States of the budget once it is adopted.
Amending budgets
1. The administrator for operations or the administrator for assistance measures shall propose an amending budget to the Committee in the following cases:
(a)
a new operation or assistance measure has been decided by the Council and therefore a new title must be created for it in the budget;
(b)
the budget outturn for a financial year for which the accounts have been approved in accordance with Article 43(6) needs to be entered in the budget of the following financial year;
(c)
due to unavoidable, exceptional or unforeseen circumstances, the appropriations entered in the titles for operations or in the titles for assistance measures do not correspond to the needs of the corresponding operation or assistance measure.
2. The draft amending budget resulting from the establishment or the extension of an operation or assistance measure shall be submitted to the Committee within a period of four months after the approval by the Council of the reference amount, unless the Committee decides on a longer deadline.
3. Any amending budget proposed by an administrator shall offset as much as possible any increase in appropriations by reductions in other titles for which that administrator is responsible.
4. The draft amending budget shall be drawn up, proposed, approved and adopted and notification given in accordance with the same procedure as the annual budget. The Committee shall discuss and adopt the amending budget taking account of its urgency.
Transfers of appropriations
1. Each administrator may make transfers of appropriations within titles of the budget for which he or she is responsible. The administrator for operations shall act on the basis of a proposal by the operation commander concerned, except for the titles for which he or she is the authorising officer. The administrator in question shall inform the Committee of his or her intention, in so far as the urgency of the situation permits, at least one week in advance.
2. However, and subject to Article 51(5), the prior approval of the Committee shall be required where the planned transfer between chapters exceeds 10 % in titles related to operations, and 20 % in titles related to assistance measures, of the appropriations entered in the chapter from which the appropriations are being drawn, as appearing in the adopted budget for the financial year on the date when the proposal for the transfer in question is made. This requirement shall not apply for transfers within a title for an assistance measure taking the form of a general programme.
3. The prior approval of the Committee shall be required for transfers of appropriations between titles within the part of the budget for operations or assistance measures respectively. Transfers of appropriations between titles shall be possible only if the same Member States contribute to the title of origin and to the title of destination. In cases where the implementation of part of an assistance measure is carried out by an operation as provided in Article 60(1), the prior approval of the Committee shall not be required for the necessary transfer of appropriations between the title for the assistance measure and the title concerning the implementation of part of the assistance measure by the operation.
4. No transfer of appropriations may be made between a title for operations and a title for assistance measures.
Carry-over of appropriations
1. Appropriations which have not been used by the end of the financial year for which they were entered and which have not been carried over to the following financial year shall be cancelled, unless otherwise provided in this Article.
2. The Committee may decide by 31 March every year, on proposals by each respective administrator to carry over commitment appropriations which have not been committed by the end of the preceding financial year, and if necessary corresponding payment appropriations, in which case they may be committed and paid up to 31 December.
3. The administrators shall present their respective proposals to the Committee by 1 March every year.
4. However, appropriations may be carried over by a decision of the responsible administrator in the following cases:
(a)
payment appropriations, where they are necessary to cover existing commitments;
(b)
commitment appropriations in titles for assistance measures for which most of the preparatory stages of the commitment procedure, to be specified in the rules for implementation pursuant to Article 11(6), have been completed by 31 December of the preceding year. Such appropriations may then be committed up to 31 March;
(c)
commitment and payment appropriations which are necessary when a Council decision for a new assistance measure has been adopted in the final quarter of the preceding financial year.
Each administrator shall inform the Committee of their carry-over decisions by 1 March every year.
5. The administrator for operations shall be assisted by each operation commander, when implementing this Article.
Split commitments
Budgetary commitments extending over more than one financial year may be broken down over several years into annual instalments.
Recovery of funds
Any recovery shall be included as revenue in the same title from which it was generated. Where that title no longer exists, the recovery shall be included in the general part for which the respective administrator is responsible.
Anticipated implementation
Once the annual budget has been adopted, appropriations may be used to cover commitments and payments in so far as operationally necessary by way of anticipated implementation.
CHAPTER 4 — Contributions
Early forecasting
1. The administrators shall present by 30 June of the year n:
(a)
a forecast for the second call for contributions for the year n;
(b)
a forecast for the ceiling for payments for the year n + 1 to take into account future or expanding operations and assistance measures not covered by the draft budget;
(c)
an indicative estimate for the annual amount of the contributions for the year n + 1, n + 2, n + 3 and n + 4 in line with estimated needs;
(d)
a forecast for the amount of the first call for contributions for the year n + 1.
2. The Committee shall decide on the ceiling for payments for year n + 1 by 31 July of year n.
3. The administrators shall present to the Committee, by 30 September of the year n:
(a)
a forecast for the annual amount of the contributions for all the titles of the draft budget;
(b)
a forecast for the amount of the first call for contributions for the year n + 1;
(c)
a revised indicative estimate based on the best available information for the annual amounts of contributions for the years n + 2, n + 3 and n + 4.
Determination of contributions
1. Contributions payable over the course of a year for a given title of the budget shall be equal to the payment appropriations entered in that title, after deduction of the revenue entered in the same title.
2. The payment appropriations for each operation or assistance measure shall be covered by contributions from the contributing Member States to that operation or assistance measure.
3. The payment appropriations in the general part of the budget for support and preparatory expenditure on operations referred to in point (b) of Article 18(3) shall be covered by contributions from the Member States except Denmark.
4. The payment appropriations in the general part of the budget for support and preparatory expenditure on assistance measures referred to in point (c) of Article 18(3) shall be covered by contributions from the Member States.
5. The breakdown of contributions between the contributing Member States shall be determined in accordance with the gross national product scale as referred to in Article 41(2) TEU and in accordance with Council Decision 2014/335/EU, Euratom ( 8 ) , or any other Council Decision which may replace it.
6. The data for the calculation of contributions shall be those set out in the ‘GNI-based own resources’ column in the ‘Summary of financing of the general budget by type of own resource and by Member State’ table appended to the latest general budget adopted by the Union. The contribution of each Member State from which a contribution is due shall be proportional to the share of gross national income (GNI) of that Member State in the total GNI aggregate of the Member States from which a contribution is due.
7. Where, pursuant to Article 5(3), a Member State abstains from the adoption of an assistance measure and does not contribute to that measure, it shall contribute an additional amount to assistance measures other than those concerning the supply of military equipment, or platforms, designed to deliver lethal force. Such additional amount shall ensure that the overall contribution of that Member State to assistance measures will be in accordance with its share of GNI. The amount of contributions due by the other Member States to the measures to which such additional contributions are made shall not be affected by those additional contributions.
8. Contributions of Member States in any year shall not exceed their respective share of the payment ceiling referred to in Article 25(2). This limit shall not apply to additional contributions pursuant to paragraph 7 of this Article resulting from abstentions from assistance measures in previous years.
Contributions following an abstention
1. A Member State which has indicated its intention to abstain from the adoption of an assistance measure as referred to in Article 5(3) may identify other assistance measures to which it will make an additional contribution. It may identify either existing measures or possible future measures for which a concept note has been presented or approved by the Council, or it may request other new measures for such purpose.
2. If the Member State referred to in paragraph 1 does not identify or request other assistance measures within six months, the High Representative or other Member States shall identify the measures to which such additional contributions will be made.
3. The High Representative, after assessing the needs of other assistance measures as referred to in paragraphs 1 and 2 of this Article, and taking due account of the Union’s strategic priorities and the objectives and principles set out in Article 56, shall present proposals as necessary to the Council for adoption.
4. The administrator for assistance measures shall keep a record of the additional contributions due by Member States which abstain from an assistance measure pursuant to Article 5(3).
5. The implementation of this Article shall respect the principles of needs-based programming and sound financial management of the Facility and preserve its effectiveness, consistent with the Treaties.
Early financing
1. The Facility shall have a minimum deposit system to provide early financing for Union rapid response operations and urgent measures as referred to in Article 58, where sufficient funds are not available and the ordinary procedure for collecting contributions would not allow for those needs to be met in good time. The minimum deposits for rapid response operations and urgent measures shall be managed by each administrator respectively.
2. The amount of the minimum deposits shall be decided, and revised as necessary, by the Committee, following proposals by the administrator.
3. For the purposes of the early financing of the minimum deposits, the Member States shall either:
(a)
pay contributions to the Facility in advance; or
(b)
when the Council decides to launch a rapid response operation to which they contribute, or approves an urgent measure, and it is necessary to resort to the minimum deposit, pay their contributions within five days following dispatch of the call at the level of the reference amount of the rapid response operation or of the authorised cost of the urgent measure, unless the Council decides otherwise.
Collection of contributions
1. Contributions to the Facility shall be made in euro.
2. Each administrator shall send calls for contributions for the appropriations pertaining to his or her respective responsibilities by letter to the competent national administrations whose details have been communicated to him or her.
3. When the implementation of an assistance measure or part thereof is carried out by an operation, the administrator for operations shall send the call for contributions to the competent national administration. If the administrator for assistance measures has already issued the call for contributions for the assistance measure before the Council decided that the measure or part thereof will be implemented by an operation, he or she shall transfer to the administrator for operations the funds necessary for the implementation.
4. The calls for contributions shall be sent when:
(a)
a budget for a financial year is adopted by the Committee. The first call for contributions shall cover the payment needs for the first eight months. The second call for contributions shall cover the remaining balance of contributions, taking into account the balance of the previous year when the Committee has decided to enter such balance in the current budget;
(b)
an amending budget is adopted as provided for in Article 19 and the planned calls for contributions for the year will not meet the payment needs in a timely manner;
(c)
contributions to the minimum deposits and their replenishment are needed as provided for in Article 28(3) and in paragraphs 9 and 10 of this Article.
5. The administrator for operations and the administrator for assistance measures shall call for contributions from the contributing Member States when the Council adopts a decision establishing an operation or an assistance measure, insofar as the funds available respectively for operations or for assistance measures are insufficient to finance the amount of payments which the Council authorised, based on the reference amount in such decision.
6. Any interest accrued on the contributions paid by Member States according to point (a) of Article 28(3) shall be taken into account for the calculation of their contributions in subsequent ordinary calls for contributions.
7. Any call for contributions shall show a breakdown of increases and reductions in contributions per title in the budget.
8. Without prejudice to other provisions of this Decision, the contributions shall be paid within 30 days following dispatch of the relevant call for contributions, with the exception of the first call for contributions for a new financial year’s budget, where the deadline for payment shall be 40 days following dispatch of the relevant call for contributions.
9. Any part used of the advance contributions to the minimum deposits shall be replenished by increasing the contribution of the relevant Member States in the next ordinary call for contributions, unless they have replenished their contribution beforehand. If there is a need to resort to the minimum deposit and the Member States concerned have not replenished their contribution meanwhile, they shall pay the amount needed, if any, within five days, pursuant to point (b) of Article 28(3).
10. Any Member State contributing in advance to a minimum deposit may authorise the responsible administrator to use up to 75 % of such contribution to cover its contribution to an operation or assistance measure. In such case, the Member State concerned shall replenish the contribution paid in advance within 90 days following dispatch of a call from the responsible administrator.
11. Once the draft budget has been submitted to the Committee, each administrator may issue an anticipated call for contributions to appropriations pertaining to his or her responsibilities before the end of the current financial year to Member States with budgetary and financial procedures not allowing payment of their contribution within the established deadlines, as a payment on account on the contributions for the following financial year’s budget.
12. Each contributing Member State and third State shall pay the bank charges relating to the payment of its own contribution.
13. The administrators shall acknowledge receipt of the contributions which they called for.
14. Where reimbursements are due, and if they cannot be made entirely by a deduction from the contributions due to the Facility, they shall be repaid to the Member States concerned within 30 days.
Management by the Facility of voluntary financial contributions
1. In accordance with the relevant provisions of the legal framework governing an operation or assistance measure, and following acceptance by the Political and Security Committee (PSC), the Committee may authorise the administrative management of a voluntary financial contribution by a Member State or a third party to be entrusted to the Facility. Such voluntary financial contribution may be earmarked for a particular project in support of the operation or assistance measure.
2. The administrative costs relating to the management of the voluntary contribution shall be covered by the voluntary contribution itself, unless the Committee decides otherwise.
3. The respective administrator, upon approval by the Committee, shall conclude with the Member State or third party concerned the necessary administrative arrangements defining the purpose of the voluntary contribution, the costs to be covered by it and the management of the voluntary contribution.
4. Any voluntary contribution may only be used for the purpose for which it is provided to the Facility as set out in the administrative arrangement with the Member State or third party in question.
5. The respective administrator shall ensure that the management of voluntary contributions complies with the relevant administrative arrangements. He or she shall provide each contributor, directly or through the operation commander where applicable, with the relevant information relating to the management of the voluntary contribution as agreed in the applicable administrative arrangement.
Interest on late payment
1. If a Member State or third party does not make a payment to the Facility by the due date, interest on late payment shall be charged at a rate equal to the European Central Bank’s main refinancing rate increased by 3,5 percentage points.
2. When a payment is late by no more than 30 days, no interest shall be charged. When payment is late by more than 30 days, interest shall be charged for the entire period of the delay.
CHAPTER 5 — Implementation
Principles
1. The Facility’s appropriations shall be used in accordance with the principles of sound financial management, namely the principles of economy, efficiency and effectiveness.
2. Authorising officers shall be responsible for implementing the Facility’s revenue and expenditure in accordance with the principles of sound financial management and for ensuring compliance with the requirements of legality and regularity.
To implement expenditure, the authorising officers shall:
(a)
make budgetary commitments and legal commitments, including by signing contracts on behalf of the Facility;
(b)
validate expenditure and authorise payments; and
(c)
undertake the preliminary steps for the implementation of appropriations.
3. An authorising officer may delegate his or her duties by a decision determining:
(a)
the staff members at an appropriate level receiving such delegation;
(b)
the extent of the conferred powers; and
(c)
the scope for delegatees to subdelegate their powers.
4. The implementation of appropriations according to the principle of the segregation of duties of the authorising officer and the accounting officer shall be ensured. The duties of authorising officer and accounting officer shall be mutually exclusive.
Methods of implementation
1. The financing of the common costs of an operation shall be implemented on behalf of the Facility by the operation commander when he or she is in office, or otherwise by the administrator for operations, in their capacity as authorising officers.
2. An assistance measure may be implemented through direct or indirect management. When an assistance measure is implemented through indirect management, the implementing actors may be designated by the Council from one of the following categories:
(a)
Member States’ ministries or Government departments, or their other public law bodies and agencies, or bodies governed by private law with a public service mission to the extent that the latter are provided with adequate financial guarantees;
(b)
an international organisation, a regional organisation, or their bodies and agencies;
(c)
a third State or its public law bodies and agencies, provided that such third State does not contravene the security and defence interests of the Union and its Member States and that it respects international law and, where relevant, the principle of good neighbourly relations with Member States;
(d)
Union agencies and bodies having legal personality.
3. In exceptional circumstances, entities that do not fall under the categories listed above may be designated as implementing actors, following confirmation by the administrator in accordance with paragraph 5, provided that the assistance measure is implemented consistently with point (c) of paragraph 2.
4. Assistance measures may also be implemented wholly or partially by the beneficiary or the bodies which it has designated. In such case, the provisions concerning implementing actors in this Decision shall apply to such beneficiary or bodies as implementing actors.
5. Without prejudice to Articles 56(3) and 66(8), the administrator shall advise, at the stage of the preparation of an assistance measure, on the capacity of possible implementing actors to implement the assistance measure or parts thereof in accordance with Chapter 10 and, where relevant, on the capacity of a recipient of a grant awarded without a call for proposals to implement the grant. An implementing actor or grant recipient shall be designated by the Council following confirmation by the administrator that the implementing actor or grant recipient has such capacity. If such capacity cannot be confirmed, the administrator shall indicate to the Council any other possible ways of implementing the measure. Where appropriate, the administrator shall consider how specific limitations in the capacity of the possible implementing actors should be addressed, in accordance with Article 66(6).
6. Assistance measures may also be implemented in full or in part by an operation as decided by the Council in accordance with Article 60, in particular with a view to providing integrated assistance including military training, advice, the provision of material support and the monitoring of its use by the beneficiary.
7. A Member State, a Union institution, an international organisation, a regional organisation or another actor to which the implementation of expenditure of an operation financed under the Facility is entrusted shall apply the rules applicable to the implementation of its own expenditure. Similarly, an implementing actor for an assistance measure may apply the rules applicable to the implementation of its own expenditure subject to the assessment referred to in Article 66. In the event of substantive divergences between those rules, on the one hand, and the provisions of this Decision and the rules adopted by the Committee pursuant to Article 11(6), on the other, the latter two shall prevail. To that effect, the responsible administrator may take the necessary remedial measures to guarantee sufficient protection of the financial interests of the Facility.
Bank accounts
1. Any bank account of the Facility shall be opened at a first-rate financial institution with its head office in a Member State and shall be a current or a short-term account in euro.
2. However, where the circumstances so warrant and after approval by the respective administrator, accounts may be opened at financial institutions with their head offices outside the Union and in currencies other than euro.
3. No bank account of the Facility may be overdrawn.
4. Member States’ contributions shall be paid into dedicated bank accounts. Those contributions shall be used to make:
(a)
the necessary advances to the operation commanders for the implementation of expenditure relating to the common costs of operations and to the cost of the assistance measures or any part thereof which are implemented by operations; and
(b)
the necessary payments to implementing actors and to suppliers necessary for assistance measures.
5. The contributions pursuant to nation-borne costs and to voluntary contributions shall be paid into dedicated bank accounts. They shall be used to implement the expenditure whose administration has been entrusted to the Facility.
Procurement
1. Procurement to be financed or pre-financed under the Facility in order to obtain, against payment of a price, the supply of movable or immovable assets, through purchase, lease, rental or hire purchase, with or without an option to buy, as well as the provision of services or the execution of works, shall be through contracts concluded on behalf of the Facility, if implemented by the Facility directly or through an operation.
2. The procurement procedures shall be aimed at ensuring, through fair and open competition, the most efficient procurement meeting the requirements of operations or assistance measures.
3. The rules adopted by the Committee pursuant to Article 11(6) for the implementation of expenditure financed through the Facility shall include provisions establishing procedures for procurement in accordance with paragraphs 1 and 2 of this Article.
Grants
1. Assistance measures may be implemented through grants awarded with or without a call for proposals.
2. The rules adopted by the Committee pursuant to Article 11(6) for the implementation of expenditure financed under the Facility shall include provisions for the award and implementation of grants, including in the duly justified cases when grants can be awarded without a call for proposals. These provisions shall ensure strict oversight by the administrator throughout the implementation of grants and take particular account of the controls applied by the administrator in cases of direct management.
Administrative arrangements to facilitate future procurement or mutual support
1. The Facility may conclude administrative arrangements with Member States, Union institutions, bodies and agencies, as well as with third States, international organisations and regional organisations and their agencies in order to facilitate future procurement or the financial aspects of mutual support, or both, in the most cost-effective manner.
2. Administrative arrangements referred to in paragraph 1 shall be:
(a)
subject to prior consultation of the Committee if they are concluded with Member States, Union institutions, or bodies or agencies of a Member State or of the Union; or
(b)
submitted to the Committee for prior approval if they are concluded with third States, international organisations or regional organisations.
3. Administrative arrangements referred to in paragraph 1 shall be signed by the responsible administrator or, where appropriate, the respective operation commander, acting on behalf of the Facility and by the competent administrative authorities of the other parties referred to in paragraph 1.
4. Framework contracts may be concluded in order to facilitate procurement in the most cost-effective manner. Framework contracts shall be submitted for approval to the Committee before being signed by the responsible administrator. Member States and operation commanders may make use of framework contracts if they so wish. The conclusion of framework contracts by the Facility shall not oblige any Member State which is not party thereto to procure goods and services on the basis of those contracts.
CHAPTER 6 — Financial reports, accounts and audit
Regular financial reports to the Committee
Every three months, each administrator, with the support of the responsible accounting officer and operation commanders, shall present to the Committee a report on the implementation of revenue and expenditure falling under his or her responsibility since the beginning of the financial year, a cash-flow report and a report on the correspondent minimum deposit.
Accounts
1. Each accounting officer shall keep the accounts of contributions called for and transfers of funds made which fall under his or her responsibility. He or she shall also draw up the accounts for the expenditure and revenue implemented under the responsibility of the respective administrator.
2. The accounting officer for operations shall draw up the annual accounts for operations and for the assistance measures or any part thereof which are implemented by operations with the support of operation commanders. The accounting officer for assistance measures shall draw up the annual accounts for assistance measures with the support of implementing actors.
General rules applicable to controls
1. The Facility, through its representatives or through control or audit bodies which it may designate, shall carry out on-the-spot checks in the operations and implementing actors, with a view to ensuring that the rules established by this Decision and by the decisions of the Committee are duly implemented and that the provisions in the contracts concluded with implementing actors are complied with.
2. The persons responsible for auditing the Facility’s revenue and expenditure shall, before carrying out their task, have received clearance for access to classified information up to at least ‘SECRET UE/EU SECRET’ level, or equivalent clearance from a Member State or NATO, as appropriate. Those persons shall ensure that they respect the confidentiality of the information and protect the data of which they become aware during their audit task, in accordance with the rules applicable to that information and data.
3. The persons responsible for auditing the Facility’s revenue and expenditure shall have access without delay and without giving prior notice to the documents and to the contents of all data supports relating to that revenue and expenditure, and to the premises where those documents and supports are kept. They may make copies thereof. The persons involved in implementing the Facility’s revenue and expenditure shall give the administrators and the persons responsible for the audit of that revenue and expenditure the necessary assistance in performing their task.
4. If irregularities are detected which entail a financial loss, the Facility shall take the necessary steps with the operation, implementing actor or supplier concerned to ensure the recovery or the restitution of the amounts concerned.
Internal auditing of the Facility
1. On a proposal from the administrator for operations and after informing the Committee, the Secretary-General of the Council shall appoint an internal auditor, and at least one deputy internal auditor, for operations. On a proposal from the administrator for assistance measures and after informing the Committee, the High Representative shall appoint an internal auditor for assistance measures.
2. Internal auditors shall be appointed for a period of four years, renewable up to a total period not exceeding eight years. Internal auditors must have the necessary professional qualifications and offer sufficient guarantees of security and independence. The internal auditors may not be an authorising officer or an accounting officer, and they may not take part in the preparation of financial statements related to the Facility.
3. Each internal auditor shall report to the responsible administrator on dealing with risks, by issuing independent opinions on the quality of management and control systems and by making recommendations for promoting sound financial management. The internal auditors shall be responsible in particular for assessing the suitability and effectiveness of internal management systems and the performance of the relevant departments in implementing policies and reaching objectives by reference to the risks associated with them.
4. The internal auditors shall perform their duties for the matters pertaining to their respective responsibilities with regard to all departments involved in the collection of the Facility’s revenue or the implementation of its expenditure.
5. Each internal auditor shall perform one or more audits during the financial year as appropriate and shall report to the responsible administrator. Operation commanders and where appropriate the implementing actors shall be informed by the responsible internal auditor of his or her findings and recommendations. Each administrator shall ensure, for matters pertaining to his or her responsibilities, including by issuing the necessary instructions to operation commanders and to implementing actors, that action is taken on his or her recommendations resulting from the audits.
6. Each administrator shall submit a report each year to the Committee on the internal audit work done on matters pertaining to his or her responsibilities, indicating the number and type of internal audits carried out, observations made, recommendations made and how those recommendations were followed up.
7. The proceedings and reports of the internal auditors shall be made available to the College of Auditors established pursuant to Article 42, together with all supporting documents relating thereto.
External auditing of the Facility
1. A College of Auditors shall be established. The revenue and expenditure arising from the implementation of this Decision pursuant to Article 1(2), as well as the annual accounts of operations and assistance measures, shall be audited by the College of Auditors.
2. The Committee shall determine the number of auditors required and appoint members of the College of Auditors for a period of up to three years, renewable once, from candidates proposed by the Member States. The Committee may extend a member’s mandate by up to six months. The candidates must be members of the highest national audit body of a Member State, or recommended by that body, and offer adequate guarantees of security and independence.
3. The Committee may appoint assistants to members of the College of Auditors on a request by the College of Auditors. The assistants must offer adequate guarantees of security and independence. Upon request from the College of Auditors, the Committee may approve recourse by the College of Auditors to qualified external support for the external auditing of the Facility.
4. The College of Auditors shall check during the financial year as well as ex post , through on-the-spot controls as well as supporting documents, that expenditure financed or pre-financed through the Facility is implemented in compliance with this Decision and the rules adopted pursuant to Article 11(6), as well as applicable Union and national law where relevant, and in accordance with the principles of sound financial management, namely the principles of economy, efficiency and effectiveness, and that internal controls are adequate.
5. The members of the College of Auditors and their assistants shall continue to be paid by their audit body of origin; the Facility shall bear their mission expenses in accordance with rules to be adopted by the Committee, as well as the cost of qualified external support.
6. During their term in office, the members of the College of Auditors and their assistants shall:
(a)
neither request nor receive instructions other than from the Committee; within its audit mandate the College of Auditors and its members shall be completely independent and solely responsible for the conduct of their external audit;
(b)
report on their task only to the Committee.
7. Each year, the College of Auditors shall elect its Chair from amongst its members or extend the current Chair’s term of office. The College of Auditors shall adopt the rules applicable to audits carried out by its members in accordance with the highest international standards. It shall approve the audit reports drawn up by its members before their transmission to the administrators and to the Committee.
8. The administrators or persons appointed by either of the administrators may at any time carry out audits of the expenditure financed through the Facility. Furthermore, the Committee, on the basis of a proposal by either of the administrators or by a Member State, may at any time appoint additional external auditors on an ad hoc basis, whose tasks and conditions of service it shall determine.
Presentation of annual accounts and budget outturn
1. Each accounting officer of the Facility, with the assistance of the responsible administrator, shall establish and provide to the College of Auditors, by 15 May following the end of the financial year, the draft annual accounts of the Facility for matters pertaining to his or her responsibilities. The accounting officer for operations shall use the accounts supplied by the operations commanders, including accounts of assistance measures or any part thereof which the operation has implemented. The accounting officer for assistance measures shall use the accounts supplied by implementing actors. By the same date, each accounting officer shall provide the Committee with the budget surplus of the financial year for each title in the budget for which he or she is responsible. Each administrator shall provide the Committee with an annual activity report for matters pertaining to his or her responsibilities.
2. The College of Auditors shall provide, on the basis of the audit work performed, including by the qualified external support referred to in Article 42(3), each accounting officer and each operation commander with its audit findings on their respective accounts by 15 July.
3. Each accounting officer, assisted by the responsible administrator, shall transmit the Facility’s final audited annual accounts for matters pertaining to his or her responsibilities to the Committee by 30 September.
4. The College of Auditors shall provide its audit report, including the audit opinion, to the Committee by 30 September following the end of the financial year. The Committee shall examine the audit report, the audit opinion and the annual accounts with a view to granting a discharge to each administrator and each operation commander.
5. Supporting documents for the Facility’s annual accounts shall be retained for a period of five years from the date on which the corresponding discharge was granted. When an operation is terminated, the operation commander shall ensure transmission of all supporting documentation, including on the implementation of any assistance measure or any part thereof which has been implemented by the operation, to the administrator for operations.
6. The Committee shall decide to enter the budget outturn for a financial year for which the accounts have been approved in the budget for the following financial year, as revenue or expenditure depending on the circumstances. However, the Committee may decide, before the accounts have been approved, to enter an estimate of the budget outturn, once it has received the audit opinion from the College of Auditors. The responsible administrator shall present the necessary amending budgets taking into account the carry-over of funds.
7. If reimbursement cannot be made entirely by deduction from the contributions due to the Facility, the balance of the budget outturn shall be repaid to the Member States concerned according to the GNI key of the year of reimbursement.
Source: EUR-Lex (Publications Office of the EU), © European Union, reuse permitted under Commission Decision 2011/833/EU.
