Auditors fail to sign of EU accounts for 11th year running
Saturday, November 19, 2005 at 2:14PM 
Auditors reject EU accounts again
For the eleventh year in a row, the European Union’s annual accounts have failed to gain a seal of approval from the EU’s own auditors.
The European Court of Auditors said the amount of spending they could verify rose to 35% in 2004 from 6% in 2003.The improvement was mainly due to a new system of control over the payment of agricultural subsidies to farmers.
But the auditors said the vast majority of spending was still affected by “errors of legality and regularity”.
This is a disgrace.
If the EU were a public company they would be have their trading certificate withdrawn, and no stock market would trade their stock. We as tax payers should be outraged and further payments from the UK treasury should be suspended until auditors agree to sign off the accounts.
I have been a vociferous defender of the European project, but it is becoming increasingly difficult to defend an institution that that seems to be unable to properly conduct itself.
This would be the same EU that has just dissolved a perfectly legal contract between two private companies (FA and Sky), for no reason other than the love of its own bluster.
Utter hypocrisy, and utterly unacceptable.
Reader Comments (1)
EU BUDGET
Your response is understandable but simplistic to say the least about this topic. The reasons why there is not greater probity on this issue or real political concern are as follows:
1. Any solution would have to increase the powers of the European Commission and Parliament to investigate and fine member states government’s public finances. I doubt our Chancellor would not permit an intrusion, nor would member states government be prepared to surrender such power to Brussels.
2. There is no European wide common standard of public finance accountancy; each state has its own traditions and standards. So it makes the job of the European Court of Auditors a very difficult one.
3. As the EU has grown the opportunities for human error and yes fraud have grown.
4. Member states implement over 90% of the EU budget on behalf of Brussels. Each with its own tradition of accountancy means it is not always fraud that is to blame for tracing funds.
5. Implementing EU policy is often very difficult, take the CAP, policy makers have to administer an agricultural policy that has to deal with widely different farming regimes from the giant agribusinesses of East Anglia to Artic rain deer herders and Spanish olive groves.
6. There is the problem of differing administrative cultures and languages, which can make it hard to achieve things.
7. The present system allows for politicians the flexibility to divert funds to pet public projects which a strict interpretation of the rules would not allow.
8. In public finance, accountancy traditions are not always the same as for business, if you read the background to the stories over the years, what you learn is much of the missing EU budget funds can not be accounted for to the criteria that the European Court of Auditors works to. Which can mean they know where much of it is, but do not have the quality of evidence required.
Just to put things in proportion the British Department of Work and Pensions has not had its books signed off for the last thirteen years. Also using a business comparison, an accountant signing off the books of a firm does not mean all is right with the firm, as investors found to their cost with ENRON.
If you really want this matter tackled then the following things have to be achieved:
1. The European Parliament has to have a powerful Parliamentary Accounts Committee that works with the European Court of Auditors with full powers to investigate and fine member governments.
2. A common European Standard of Public Finance Accountancy has to be introduced.
3. The European Commission has to take full control of implementing its £67.2 billion budget.
4. The systems for implementation of the budget have to be simplified.