15.12.2009   

EN

Official Journal of the European Union

C 304/142

REPORT

on the annual accounts of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008, together with the Foundation’s replies

2009/C 304/26

CONTENTS

 

Paragraph

Page

INTRODUCTION…

1-2

143

STATEMENT OF ASSURANCE…

3-12

143

COMMENTS ON THE BUDGETARY AND FINANCIAL MANAGEMENT…

13-16

144

Table…

145

The Foundation’s replies…

147

INTRODUCTION

1.

The European Foundation for the Improvement of Living and Working Conditions (hereinafter ‘the Foundation’), located in Dublin, was set up by Council Regulation (EEC) No 1365/75 of 26 May 1975 (1). Its aim is to contribute to the planning and establishment of better living and working conditions in the European Union by increasing and disseminating knowledge which is relevant to this subject (2).

2.

The Foundation’s 2008 budget amounted to 21 million euro compared with 20,2 million euro the previous year. The number of staff employed by the Foundation at the end of the year was 87 as compared with 95 the previous year.

STATEMENT OF ASSURANCE

3.

Pursuant to the provisions of Article 248 of the Treaty the Court has audited the annual accounts (3) of the Foundation, which comprise the ‘financial statements’ (4) and the ‘reports on implementation of the budget’ (5) for the financial year ended 31 December 2008 and the legality and regularity of the transactions underlying those accounts.

4.

This Statement of Assurance is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (6).

The Director’s responsibility

5.

As authorising officer, the Director implements the revenue and expenditure of the budget in accordance with the financial rules of the Foundation under his own responsibility and within the limits of authorised appropriations (7). The Director is responsible for putting in place (8) the organisational structure and the internal management and control systems and procedures relevant for drawing up final accounts (9) that are free from material misstatement, whether due to fraud or error, and for ensuring that the transactions underlying those accounts are legal and regular.

The Court’s responsibility

6.

The Court’s responsibility is to provide, on the basis of its audit, a statement of assurance as to the reliability of the annual accounts of the Foundation and the legality and regularity of the transactions underlying them.

7.

The Court conducted its audit in accordance with the IFAC and ISSAI (10) International Auditing Standards and Codes of Ethics. Those standards require that the Court complies with ethical requirements and plans and performs the audit to obtain reasonable assurance about whether the accounts are free from material misstatement and whether the underlying transactions are legal and regular.

8.

The Court’s audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the accounts and about the legality and regularity of the transactions underlying them. The procedures selected depend on its audit judgement including the assessment of the risks of material misstatement of the accounts or of illegal or irregular transactions, whether due to fraud or error. In making those risk assessments internal control relevant to the entity’s preparation and presentation of accounts is considered in order to design audit procedures that are appropriate in the circumstances. The Court’s audit also includes evaluating the appropriateness of accounting policies used and, the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the accounts.

9.

The Court believes that the audit evidence obtained is sufficient and appropriate to provide a basis for the opinions set out below.

Opinion on the reliability of the accounts

10.

In the Court’s opinion, the Foundation’s Annual Accounts (11) present fairly, in all material respects, its financial position as of 31 December 2008 and the results of its operations and its cash flows for the year then ended, in accordance with the provisions of its Financial Regulation.

Opinion on the legality and the regularity of the transactions underlying the accounts

11.

In the Court’s opinion, the transactions underlying the annual accounts of the Foundation for the financial year ended 31 December 2008 are, in all material respects, legal and regular.

12.

The comments which follow do not call the Court’s opinions into question.

COMMENTS ON THE BUDGETARY AND FINANCIAL MANAGEMENT

13.

For operational expenditure, the amount carried forward, 4,9 million euro, was more than 55 % of the appropriations. This situation was at odds with the principle of annuality. It indicates weaknesses in the programming of the operational activities of the Foundation.

14.

The justification of the budgetary transfers was insufficient: no estimation of the needs was provided. Moreover, the Governing Board was not informed about them.

15.

The closure of the 2008 accounts was handled by a short-term employee recruited through an employment agency. The hand-over report submitted by the previous Accounting Officer was unsatisfactory and incomplete and a proper transition between the previous Accounting Officer and the new one was not ensured. As a result, the quality of the financial statements in several areas (e.g. fixed assets, accrued expenses, assigned revenue, VAT, etc.) was unsatisfactory, showed inconsistencies with the 2007 accounts and therefore required important adjustments during the audit.

16.

With regard to procurement procedures, in one case (12) the use of a negotiated procedure was not justified. In two other cases (13), the Foundation irregularly extended contracts beyond the maximum duration permitted. The Foundation should aim to improve the monitoring of its contracts and the programming of its procurement procedures, launching new tenders well before the corresponding contracts come to an end.

This report was adopted by the Court of Auditors in Luxembourg at its meeting of 8 October 2009.

For the Court of Auditors

Vítor Manuel da SILVA CALDEIRA

President

Table

European Foundation for the Improvement of Living and Working Conditions (Dublin)

Areas of Community competence deriving from the Treaty

Competences of the Foundation as defined in Council Regulation (EEC) No 1365/75 as amended by Regulation (EC) No 1111/2005

Governance

Resources available to the Foundation in 2008

(data for 2007)

Activities and services provided

‘The Community and the Member States, having in mind fundamental social rights, (…) shall have as their objectives (…) improved living and working conditions, (…) the Community shall support and complement the activities of the Member States in the following fields: (…) (b) working conditions; (c) social security and the social protection of workers; (d) protection of workers where their employment contract is terminated; (e) the information and consultation of workers; (f) representation and the collective defence of the interests of workers and employers, including co-determination; (g) conditions of employment for third-country nationals; (h) the integration of persons excluded from the labour market; (i) equality between men and women (…)’

(Articles 136 and 137 of the Treaty)

Objectives:

The aim of the Foundation shall be to contribute to the establishment of better living and working conditions by increasing and disseminating knowledge which is relevant to this subject. In particular, it is required to consider the following areas:

—

man at work,

—

organisation of work and particularly job design,

—

problems peculiar to certain categories of workers,

—

long-term aspects of the improvement of the environment,

—

the distribution of human activities in space and in time.

Tasks:

—

to foster the exchange of information and experience in these fields,

—

to facilitate contact between universities, study and research institutes, economic and social administrations and organisations,

—

to carry out studies or to conclude study ontracts and to ovide assistance for pilot projects,

—

to cooperate as closely as possible with existing specialised institutes in the Member States and at international level.

1.   The Governing Board (GB)

—

from each Member State: one government representative, one representative from employers’ organisations and one workers’ representative,

—

three representatives from the Commission.

2.   The Bureau of the GB

—

consists of 11 members; three members from each of the social partners and the governments, two from the Commission,

—

it monitors the implementation of decisions of the GB and takes measures for the proper management between GB meetings.

3.   The Director is appointed by the Commission from a list of candidates submitted by the GB, he implements the decisions of the GB and the Bureau of the GB and manages the Foundation.

4.   The Advisory Committees are composed of up to three members from the Commission, governments and the social partners, with the aim to advise on the implementation of major projects and the assessment of results.

5.   External audit

Court of Auditors.

6.   Discharge authority

Parliament acting on recommendation of the Council.

Budget

21,0 million euro

(20,2 million euro)

Staff at 31 December 2008

101 posts provided for in the establishment plan, of which 78 (84) were occupied

Other Staff:

Seconded National Experts and employment Agencies staff: 0 (1)

Contract Agents: 9 (10)

Total Staff employed: 87 (95)

Operating activities: 56 (55)

Administrative tasks: 27 (36)

Mixed: 4 (4)

Monitoring and surveys

—

European Industrial Relations Observatory (EIRO) 572 information updates added, European Working Conditions Observatory (EWCO) 159 information updates added and European Restructuring Monitor (ERM) 1 532 restructuring fact sheets added.

—

4th European Working Conditions Survey: secondary analysis (published: ageing workforce, work organisation, use of technology).

—

2nd European Quality of Life Survey (EQLS); completion of field work (31 countries; 35 000 interviewed), analysis of data; first results published (Resume).

—

European Company Survey; preparation of field work.

Employment and restructuring

—

European Restructuring Monitor case studies.

—

Impact of globalisation on selected sectors (Transport; Textiles; Energy).

—

Undeclared work (measures from five countries).

—

Changes in employment structure (Report ‘More and better jobs’).

—

Links between innovation, productivity and employment.

Work-life balance and working conditions

—

Working conditions and social dialogue.

—

Flexibility and security over the life course.

—

Global comparison of working conditions.

—

Older women workers in Europe.

Industrial relations and partnership

—

Codes of conduct and international framework agreements.

—

Dynamics of European sectoral social dialogue.

Working time and industrial relations; pay and industrial relations.

—

Stakeholder enquiry service:

Liability in subcontracting processes in the European construction sector.

—

Employability and flexicurity.

—

Continuing vocational training and industrial relations.

Social cohesion and quality of life

—

Role of local authorities in the integration of migrants.

—

Demographic change and employment in social services.

Communication and sharing ideas and experience

437 publications, 1,59 million users sessions (average of 4 370/day); 35 press activities; 2 149 article cuttings with advertising value equivalent (AVE) of 4,08 m euro, reaching 112 156 300 people, up from 58 765 900 in 2006; 242 journalist enquiries.

Promotion campaigns: four resource packs (Ageing, Globalisation, Flexicurity, Migration).

—

4 Roadshows (F, NL, CZ, GR).

—

Company Network Seminar: ‘Flexibility policies at the company level: a common interest?’ Foundation Seminar Series: ‘Developing workers’ skills – actors and actions’ — National Outreach Centres covering AU, BE, ES, FI, FR, HU, IT, LUX, SP, UK.

—

57 exhibitions and 52 visits to the Foundation.

Source: Information supplied by the Foundation.

THE FOUNDATION’S REPLIES

13.

Already in our annual programming an amount of 45 % of Title 3 was planned to be carried forward due to the duration of study contracts and our payment schedule. The weakness to be improved exists but is much smaller than indicated (about 10 %).

14.

All budgetary transfers are now backed up by supporting documentation and the Bureau of the Governing Board will be regularly informed.

15.

The old Accounting Officer had to give 3 months notice which is not enough to recruit a new Official/Temporary Agent. A certified accountant was therefore recruited on a temporary basis to ensure a proper closure of the Annual accounts. All problems in the accounts arising from the hand-over between the old and new Accounting Officer have now been corrected.

16.

For the insurance and travel agency services Eurofound launched procedures for multiannual contracts which have been concluded in the meantime. For the legal services the contractor was retained for reasons of business continuity (Eurofound had pending legal cases). A new tender procedure is currently in progress to set up a multiannual framework contract for legal services. Our project management system includes a separate template for the planning of procurement and for the management of contracts to assist the timely programming of procurement procedures

(1)  OJ L 139, 30.5.1975, p. 1.

(2)  The Table summarises the Foundation’s competences and activities. It is presented for information purposes.

(3)  These accounts are accompanied by a report on the budgetary and financial management during the year which gives inter alia an account of the rate of implementation of the appropriations with summary information on the transfers of appropriations among the various budget items.

(4)  The financial statements include the balance sheet and the economic outturn account, the cash-flow table, the statement of changes in capital and the annex to the financial statements which includes the description of the significant accounting policies and other explanatory information.

(5)  The budget implementation reports comprise the budget outturn account and its annex.

(6)  OJ L 248, 16.9.2002, p. 1.

(7)  Article 33 of Commission Regulation (EC, Euratom) No 2343/2002 of 23 December 2002 (OJ L 357, 31.12.2002, p. 72).

(8)  Article 38 of Regulation (EC, Euratom) No 2343/2002.

(9)  The rules concerning the presentation of the accounts and accounting by the Agencies are laid down in chapter 1 of Title VII of Regulation (EC, Euratom) No 2343/2002 as last amended by Commission Regulation (EC, Euratom) No 652/2008 of 9 July 2008 (OJ L 181, 10.7.2008, p. 23) and are integrated as such in the Financial Regulation of the Foundation.

(10)  International Federation of Accountants (IFAC) and International Standards of Supreme Audit Institutions (ISSAI).

(11)  The Final Annual Accounts were drawn up on 30 June 2009 and received by the Court on 2 July 2009. The Final Annual Accounts, consolidated with those of the Commission are published in the Official Journal of the European Union by 15 November of the following year. These can be found on the following website http://eca.europa.eu or http://www.eurofound.europa.eu

(12)  Renewal of the service contract for the provision of insurance services (37 000 euro).

(13)  Service contracts for the provision of travel agency services (157 000 euro) and for the provision of legal services (25 000 euro).