Auditors should scrutinise EU accounts state by state

The European Court of
is being urged to concentrate on reporting on European Commission
accounts by category and nation instead of its single Statement of Assurance.

The proposal from the
European Union Committee
follows the 12th successive refusal of the court to
give a positive statement on the EU accounts.  UK comptroller and auditor
general Sir John Bourn remarked, after hearing the result, that he would have
have to qualify the UK accounts if he were required to consider a similar
statement of assurance covering the whole of British government expenditure.

Sir John’s comment – after qualifying 13 out of 500 UK government accounts –
was underlined in the Lords committee report.

The committee said the EU Court should clearly distinguish between
irregularity and fraud, after making it clear it had been presented ‘with no
evidence to support allegations of a culture of corruption within the
Commission’s administration’.

It urged: ‘The Statement of Assurance should focus on giving a detailed
summary of financial management in each of the spending categories and Member

The report said 80% of European funds are disbursed within Member States and
called for ‘the introduction of national Statements of Assurance signed by a
minister or senior civil servant, audited to internationally recognised
standards by the national Supreme Audit Institution and submitted to the
Commission and national parliaments’.

Peers wanted a list naming and shaming those states demonstrating poor
management of EU funds to be produced by the Court.

They also proposed transferring responsibility for responding to annual
Statements of Assurance – or lack thereof – transferred from
ECOFIN [Council of
Finance Ministers] to the Budget Council. Peers concluded that the level of
fraud in the EU is no higher than in comparable public expenditure programmes –
including the UK.

Further reading:

the report from the House of Lords

Look at the EU website

Related reading