The last Line of Defence at national Level for protecting the financial Interests of the European Union in the Cohesion Policy – Audit Authorities’ Role as Assurance Providers

Textbook , 140 Pages

Politics - Topic: European Union

This book portrays the multilevel governance structure of the EU's Cohesion Policy, describes and critically assesses the evolution of the functions and responsibilities of the national audit authorities. Furthermore, this analysis puts a focal point on the impact of the audit authorities' work on the assurance level of the EU’s spending in the Cohesion Policy.

The European Union (EU) is committed to creating more and better jobs and a socially inclusive society. In this sense, EU cohesion policy plays a key role, as it aims to reduce development disparities between countries and regions, restructure declining industrial areas and encourage cross‐border, transnational and interregional cooperation in the EU in order to strengthening economic, social and territorial cohesion.

The budget for this policy field has developed steadily and represents meanwhile more than one third of appropriations for the current multiannual financial framework. It is therefore the EU’s main investment policy.
In order to achieve Cohesion Policy’s objectives and to ensure high impact for limited funds, a proper and effective management and control system is vital. Cohesion Policy is implemented under shared management, which means that responsibility for implementing the policy and the related funds, including control activities, is shared between the European Commission and the Member States.

For the 2007-2013 programming period, a formal three-level control structure was introduced at national level for the first time, with the audit authority as the first “independent” audit layer. In a multi-level governance system, and based on the single-audit concept, audit authorities act as cornerstones of the overall assurance process by providing the European Commission with assurance as to the effective functioning of the management systems and internal controls for operational programmes – and thus the legality and regularity – of the expenditure certified by the Member State to the Commission.
Together with other structural reforms, the formalisation of the internal control structure with a clear separation of functions and greater independence for management and control bodies is regarded as a material contribution towards a more robust governance system in relation to the audit of Cohesion expenditure.

Inhaltsverzeichnis (Table of Contents)

• 1 INTRODUCTION..................................................................................1
• 2 WHAT IS COHESION POLICY ABOUT? – THE FUNDAMENTALS
• 2.1 Understanding Cohesion Policy........................................................4
• 2.1.1 Definition of Cohesion Policy....................................................4
• 2.1.2 Importance of Cohesion Policy in the overall political context..........4
• 2.1.3 Implementation means ..........................................................5
• 2.2 Governance structure and dimensions of Cohesion Policy.....................9
• 2.3 Cohesion Policy from a financial point of view...................................12
• 2.3.1 Financial planning of Cohesion Policy.......................................12
• 2.3.2 Financial dimensions of Cohesion Policy....................................14
• 2.4 The multilevel governance system...............................................17
• 2.4.1 Multilevel governance as an implementing model for Cohesion Policy.....17
• 2.4.2 The principle of shared budget management as a result of a multi-level governance structure.........................................................................20
• 2.5 The organisational set-up of Cohesion Policy and its main stakeholders........23
• 2.5.1 Main stakeholders at European level...........................................23
• 2.5.1.1 The European Commission.......................................................24
• 2.5.1.2 The Council....................................................................27
• 2.5.1.3 The European Parliament.....................................................27
• 2.5.2 Programming and main stakeholders at national and regional level......29
• 2.5.2.1 Programming at national and regional level...........................29
• 2.5.2.2 Main stakeholders at Operational Programme level..................31
• 2.6 The audit authorities' role........................................................34
• 2.7 The single-audit concept............................................................34
• 2.7.1 Background.......................................................................34
• 2.7.2 Audit standards and guidance................................................39
• 2.7.3 Benefits of the single-audit concept.......................................41
• 2.7.4 General principles for the application of the single-audit concept....41
• 3 RESPONSIBILITIES OF AUDIT AUTHORITIES...........................................50
• 3.1 Introduction...........................................................................50
• 3.2 Responsibilities of audit authorities.............................................53
• 3.2.1 Compliance assessment of the management and control system..........53
• 3.2.1.1 Programming period 2007-2013........................................53
• 3.2.1.2 Programming period 2014-2020........................................59
• 3.2.1.3 Programming period 2021-2027........................................61
• 3.2.2 Audits of operations...........................................................65
• 3.2.2.1 Programming period 2007-2013........................................65
• 3.2.2.2 Programming period 2014-2020........................................68
• 3.2.2.3 Programming period 2021-2027........................................73
• 3.2.3 Systems audits....................................................................75
• 3.2.3.1 Programming period 2007-2013........................................75
• 3.2.3.2 Programming period 2014-2020........................................77
• 3.2.3.3 Programming period 2021-2027........................................80
• 3.2.4 Annual control report..........................................................81
• 3.2.4.1 Programming period 2007-2013........................................81
• 3.2.4.2 Programming period 2014-2020........................................82
• 3.2.4.3 Programming period 2021-2027........................................84
• 3.2.5 Annual summary / Annual clearance..........................................87
• 3.2.5.1 Programming period 2007-2013........................................87
• 3.2.5.2 Programming period 2014-2020........................................88
• 3.2.5.3 Programming period 2021-2027........................................90
• 3.2.6 Work at programme closure...................................................91
• 3.2.6.1 Programming period 2007-2013........................................91
• 3.2.6.2 Programming period 2014-2020........................................91
• 3.2.6.3 Programming period 2021-2027........................................92
• 3.2.7 Checks on the reliability of performance data..............................94
• 3.2.7.1 Programming period 2007-2013........................................94
• 3.2.7.2 Programming period 2014-2020........................................97
• 3.2.7.3 Programming period 2021-2027........................................97
• 4 IMPACT OF THE AUDIT AUTHORITIES' WORK ON THE ASSURANCE LEVEL OF EU SPENDING..............................................................................97
• 4.1 Development of error rates reports by the ECA..................................97
• 4.2 How does the ECA assess the AAs' work?...........................................104
• 4.3 A modified assurance setup for the 2021-2027 programming period...........................................................................108
• 5 CONCLUDING REMARKS...................................................................111

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This text aims to provide a comprehensive understanding of the role played by audit authorities in ensuring the sound financial management of the European Union's Cohesion Policy. It explores the multilevel governance system underpinning the policy, its financial dimensions, and the responsibilities of audit authorities in ensuring compliance with regulations and the effective use of EU funds.

• The complexities of the multilevel governance system for Cohesion Policy
• The financial aspects of Cohesion Policy and the role of the European Court of Auditors
• The responsibilities of audit authorities in ensuring compliance and value for money
• The single-audit concept and its impact on the assurance level of EU spending
• The impact of the audit authorities' work on the assurance level of EU spending

Zusammenfassung der Kapitel (Chapter Summaries)

Chapter 1 provides an introduction to the topic and sets the scene for the subsequent chapters. Chapter 2 delves into the fundamentals of Cohesion Policy, outlining its definition, importance, implementation means, governance structure, and financial aspects. The chapter examines the multilevel governance system and the principle of shared budget management. It concludes by identifying the main stakeholders involved in Cohesion Policy implementation at different levels.

Chapter 3 focuses on the responsibilities of audit authorities in the context of Cohesion Policy. It outlines the compliance assessment of management and control systems, audits of operations and systems, annual control reports, annual summaries, and work at programme closure. It also discusses checks on the reliability of performance data.

Chapter 4 explores the impact of the audit authorities' work on the assurance level of EU spending, examining the development of error rates reports by the European Court of Auditors and how the Court assesses the work of audit authorities.

Schlüsselwörter (Keywords)

The main keywords and focus topics of this text include Cohesion Policy, multilevel governance, shared budget management, audit authorities, single-audit concept, compliance assessment, value for money, European Court of Auditors, assurance level, and EU spending.

• Author: Dr. Marcel Bode (Author)
• Pages: 140
• Catalog Number: V1225484
• ISBN (PDF): 9783346655967
• ISBN (Book): 9783346655974
• Language: English
• Tags: Cohesion Policy, Multi-level Governance, European Union, Audit Authorities, Shared budget management, management and control systems, structural funds