Brussels sweats on court's accounts verdict

The European Court of Auditors is set this week to deliver its verdict on EU spending, as Brussels looks to get a clean bill of health for its spending for the first time ever.

The court is set to reveal its report on Tuesday. The EU has been criticised by the court for its accounting of the handouts it gives to farmers, academics and other groups, on the basis either of fraud or inaccurately filed paperwork since the reports began in 1994.

Brian Gray, the EC’s accounting officer, says in an interview with Accountancy Age today that ‘there is a very marginal element of fraud’ in EU accounts. He comments on current initiatives to turn the situation around, and refers to the bitter battle with former chief accounting officer Marta Andreasen.

‘[Marta] was recruited from outside. Within five months she had lost the confidence of her bosses and moved out. I looked to see what she was complaining about. Generally what she had found is written on by the Court of Auditors,’ he said.

The release of the report is likely to see the usual battles over who is to blame for the problems. Last year EU anti-fraud commissioner Siim Kallas got the retaliation in first by pinning the blame on member states’ unwillingness to check the spending they are responsible for distributing.

UK comptroller and auditor general Sir John Bourn also appeared to lend his support last year by saying that if he had to audit UK accounts on the EU basis, he would have to qualify them as a whole.

He told a Lords committee on the subject: ‘If you are trying to wrap up all the expenditure in one statement, it will be very difficult to get there [to a statement of assurance].’

Sir John also argued that the traditions of the EU and UK auditing were in origin different. ‘The court comes out of a different tradition from the National Audit Office. It does come out of the Roman law tradition, which sees auditing as essentially about legality and regularity rather than a tradition which looks at the accounts and asks if they give a true and fair view.’

The court always objects to the legality and regularity of the transactions rather saying the accounts do not give a true and fair view.

The commission is only responsible for around 20% of the funds distributed under agricultural programmes, regional redistribution initiatives and other spending.
The UK has pledged to produce a statement on its own spending to be audited by the NAO.