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Document 52014DC0486
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL AND THE COURT OF AUDITORS ANNUAL ACCOUNTS OF THE EUROPEAN COMMISSION 2013
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL AND THE COURT OF AUDITORS ANNUAL ACCOUNTS OF THE EUROPEAN COMMISSION 2013
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL AND THE COURT OF AUDITORS ANNUAL ACCOUNTS OF THE EUROPEAN COMMISSION 2013
/* COM/2014/0486 final */
52014DC0486
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL AND THE COURT OF AUDITORS ANNUAL ACCOUNTS OF THE EUROPEAN COMMISSION 2013 /* COM/2014/0486 final */
Annual accounts of the
European Commission 2013 CONTENTS CERTIFICATION OF
THE ACCOUNTS. 4 FINANCIAL
STATEMENTS AND EXPLANATORY NOTES. 6 BALANCE SHEET. 9 STATEMENT OF FINANCIAL
PERFORMANCE. 10 CASHFLOW STATEMENT. 11 STATEMENT OF CHANGES IN
NET ASSETS. 12 NOTES TO THE FINANCIAL
STATEMENTS. 13 REPORTS
ON THE IMPLEMENTATION OF THE BUDGET AND EXPLANATORY NOTES 54 CERTIFICATION OF THE ACCOUNTS The annual accounts of the European
Commission for the year 2013 have been prepared in accordance with the
Financial Regulation applicable to the general budget of the European Union and
the accounting rules adopted by myself in my capacity as the Commission's
Accounting Officer, as are to be applied by all the institutions and Union
bodies. I acknowledge my responsibility for
the preparation and presentation of the annual accounts of the European
Commission in accordance with Article 68 of the Financial Regulation. I have obtained from the
authorising officers, who certified its reliability, all the information
necessary for the production of the accounts that show the European
Commission's assets and liabilities and the budgetary implementation. I hereby certify that based on this
information, and on such checks as I deemed necessary to sign off the accounts,
I have a reasonable assurance that the accounts present fairly, in all material
aspects, the financial position, the results of the operations and the
cash-flow of the European Commission. [signed] Manfred Kraff Accounting Officer of the
Commission EUROPEAN COMMISSION FINANCIAL YEAR 2013 FINANCIAL
STATEMENTS AND EXPLANATORY NOTES* * It should be noted
that due to the rounding of figures into millions of euros, some financial data
in the tables below may appear not to add-up. CONTENTS FINANCIAL STATEMENTS
AND EXPLANATORY NOTES BALANCE
SHEET. 9 STATEMENT
OF FINANCIAL PERFORMANCE. 10 CASHFLOW
STATEMENT. 11 STATEMENT
OF CHANGES IN NET ASSETS. 12 NOTES TO THE FINANCIAL STATEMENTS. 12 1. SIGNIFICANT
ACCOUNTING POLICIES. 14 2. NOTES TO THE BALANCE
SHEET. 26 3. NOTES TO THE
STATEMENT OF FINANCIAL PERFORMANCE. 42 4. NOTES TO THE CASHFLOW
STATEMENT. 47 5. CONTINGENT ASSETS
& LIABILITIES AND OTHER SIGNIFICANT DISCLOSURES. 48 6. RELATED PARTIES. 52 7. EVENTS AFTER THE
BALANCE SHEET DATE. 53 BALANCE SHEET || || || EUR millions || Note || 31.12.2013 || 31.12.2012 NON-CURRENT ASSETS || || || Intangible assets || 2.1 || 78 || 61 Property, plant and equipment || 2.2 || 2 888 || 2 488 Investments accounted for using the equity method || 2.3 || 349 || 392 Financial assets || 2.4 || 58 490 || 60 920 Receivables and recoverables || 2.5 || 529 || 595 Pre-financing || 2.6 || 37 995 || 44 487 || || 100 329 || 108 943 CURRENT ASSETS || || || Inventories || 2.7 || 85 || 85 Financial assets || 2.8 || 4 821 || 1 338 Receivables and recoverables || 2.9 || 13 007 || 13 922 Pre-financing || 2.10 || 21 189 || 13 148 Cash and cash equivalents || 2.11 || 8 275 || 9 278 || || 47 377 || 37 771 TOTAL ASSETS || || 147 706 || 146 714 || || || NON-CURRENT LIABILITIES || || || Pension and other employee benefits || 2.12 || (46 103) || (41 620) Provisions || 2.13 || (1 303) || (1 237) Financial liabilities || 2.14 || (53 964) || (57 038) Other liabilities || 2.15 || (1 442) || (1 502) || || (102 812) || (101 397) CURRENT LIABILITIES || || || Provisions || 2.16 || (489) || (714) Financial liabilities || 2.17 || (3 065) || (15) Payables || 2.18 || (91 955) || (89 484) || || (95 509) || (90 213) TOTAL LIABILITIES || || (198 321) || (191 610) || || || NET ASSETS || || (50 615) || (44 896) || || || Reserves || 2.19 || 2 299 || 2 254 Amounts to be called from Member States* || 2.20 || (52 913) || (47 150) || || || NET ASSETS || || (50 615) || (44 896) * The
European Parliament adopted a budget on 20 November 2013 which provides for the
payment of the Union's short-term liabilities from own resources to be
collected by, or called up from, the Member States in 2014. Additionally, under
Article 83 of the Staff Regulations (Council Regulation 259/68 of 29 February
1968 as amended), the Member States shall jointly guarantee the liability for
pensions. STATEMENT
OF FINANCIAL PERFORMANCE || || || EUR millions || Note || 31.12.2013 || 31.12.2012 OPERATING REVENUE || || || Own resource and contributions revenue || 3.1 || 138 156 || 128 076 Other operating revenue || 3.2 || 7 484 || 6 083 || || 145 640 || 134 159 OPERATING EXPENSES || || || Administrative expenses || 3.3 || (5 107) || (5 221) Operating expenses || 3.4 || (138 886) || (125 008) || || (143 993) || (130 229) SURPLUS/(DEFICIT) FROM OPERATING ACTIVITIES || || 1 647 || 3 930 Financial revenue || 3.5 || 1 972 || 2 084 Financial expenses || 3.6 || (1 990) || (1 897) Movement in pension and other employee benefits liability || || (5 706) || (8 636) Share of net deficit of joint ventures and associates || 3.7 || (608) || (489) ECONOMIC RESULT OF THE YEAR || || (4 685) || (5 008) CASHFLOW STATEMENT || || || EUR millions || Note || 2013 || 2012 Economic result of the year || || (4 685) || (5 008) Operating activities || 4.2 || || Amortisation || || 9 || 8 Depreciation || || 139 || 143 (Reversal of) impairment losses on investments || || 6 || 2 (Increase)/decrease in loans || || 30 || (16 074) (Increase)/decrease in receivables and recoverables || || 980 || (4 847) (Increase)/decrease in pre-financing || || (1 547) || (1 939) (Increase)/decrease in inventories || || 0 || (2) Increase/(decrease) in provisions || || (160) || 234 Increase/(decrease) in financial liabilities || || (25) || 16 059 Increase/(decrease) in other non-current liabilities || || (60) || (48) Increase/(decrease) in payables || || 2 473 || (1 436) Prior year budgetary surplus taken as non-cash revenue || || (1 023) || (1 497) Other non-cash movements || || (17) || 178 || || || Increase in pension and employee benefits liability || || 4 483 || 7 482 || || || Investing activities || 4.3 || || (Increase)/decrease in intangible assets and property, plant and equipment || || (566) || (582) (Increase)/decrease in investments accounted for using the equity method || || 42 || (18) (Increase)/decrease in AFS investments || || (1 082) || (738) || || || NET CASHFLOW || || (1 003) || (8 083) || || || Net increase/(decrease) in cash and cash equivalents || || (1 003) || (8 083) Cash and cash equivalents at the beginning of the year || 2.11 || 9 278 || 17 361 Cash and cash equivalents at year-end || 2.11 || 8 275 || 9 278 STATEMENT OF CHANGES IN NET ASSETS || || || EUR millions || Reserves (A) || Amounts to be called from Member States (B) || Net Assets =(A)+(B) || Fair value reserve || Other reserves || Accumulated Surplus/(Deficit) || Economic result of the year BALANCE AS AT 31.12.2011 || (82) || 1 970 || (38 374) || (2 085) || (38 571) Movement in Guarantee Fund reserve || - || 168 || (168) || - || - Fair value movements || 178 || - || - || - || 178 Other || - || 20 || (18) || - || 2 Allocation of the 2011 economic result || - || - || (2 085) || 2 085 || - 2011 budget result credited to Member States || - || - || (1 497) || - || (1 497) Economic Result for the year || - || - || - || (5 008) || (5 008) BALANCE AS AT 31.12.2012 || 96 || 2 158 || (42 142) || (5 008) || (44 896) Movement in Guarantee Fund reserve || - || 46 || (46) || - || - Fair value movements || (13) || - || - || - || (13) Other || - || 11 || (9) || - || 2 Allocation of the 2012 economic result || - || - || (5 008) || 5 008 || - 2012 budget result credited to Member States || - || - || (1 023) || - || (1 023) Economic result of the year || - || - || - || (4 685) || (4 685) BALANCE AS AT 31.12.2013 || 83 || 2 215 || (48 228) || (4 685) || (50 615) NOTES TO THE
FINANCIAL STATEMENTS* * For further
information in addition to that included in the notes below, please also see
the 2013 EU consolidated annual accounts 1.
SIGNIFICANT ACCOUNTING POLICIES The European Commission (hereinafter referred to as the
Commission) follows the accounting policies of the European Union (hereinafter
referred to as the EU). A summary of the significant accounting policies is
given below. 1.1. LEGAL
BASIS AND ACCOUNTING RULES The accounts of the EU are kept in
accordance with Regulation (EU, Euratom) No 966/2012 of the European Parliament
and of the Council of 25 October 2012 on the financial rules applicable to the
general budget of the Union and repealing Council Regulation (EC, Euratom) No
1605/2002 (OJ L 298, 26.10.2012, p. 1) hereinafter referred to as the
'Financial Regulation' and Commission Delegated Regulation (EU) No 1268/2012 of
29 October 2012 (OJ L 362, 31.12.2012, p. 1) laying down detailed rules of application
of this Financial Regulation. In accordance with article 143 of
the Financial Regulation, the EU prepares its financial statements on the basis
of accrual-based accounting rules that are based on International Public Sector
Accounting Standards (IPSAS). These accounting rules, adopted by the Accounting
Officer of the Commission, have to be applied by all the institutions and EU
bodies falling within the scope of consolidation in order to establish a
uniform set of rules for accounting, valuation and presentation of the accounts
with a view to harmonising the process for drawing up the financial statements
and consolidation. The accounts are kept in Euro on the basis of the calendar
year. 1.2. ACCOUNTING
PRINCIPLES The objective of the financial statements
is to provide information about the financial position, performance and
cashflows of an entity that is useful to a wide range of users. For the EU as a
public sector entity, the objectives are more specifically to provide
information useful for decision making, and to demonstrate the accountability
of the entity for the resources entrusted to it. It is with these goals in mind
that the present document has been drawn up. The overall considerations (or
accounting principles) to be followed when preparing the financial statements
are laid down in EU accounting rule 2 and are the same as those described in
IPSAS 1, that is: fair presentation, accrual basis, going concern, consistency
of presentation, aggregation, offsetting and comparative information. The
qualitative characteristics of financial reporting according to article 144 of
the Financial Regulation are relevance, reliability, understandability and
comparability. Preparation of the financial
statements in accordance with the above mentioned rules and principles requires
management to make estimates that affect the reported amounts of certain items
in the balance sheet and statement of financial performance, as well as the
disclosures of contingent assets and liabilities. 1.3. CONSOLIDATION SCOPE OF CONSOLIDATION The consolidated financial
statements of the EU comprise all significant controlled entities (i.e. the EU
institutions (including the Commission) and the EU agencies), associates and
joint ventures, this being 52 controlled entities, 5 joint ventures and 4
associates. The complete list of consolidated entities can be found in note 11.1 of the EU accounts. In comparison with 2012, the scope
of consolidation has been extended by 1 controlled entity (agency). The impact
of the additions on the consolidated financial statements is not material. CONTROLLED ENTITIES The decision to include an entity
in the scope of consolidation is based on the control concept. Controlled
entities are all entities over which the EU has, directly or indirectly, the power
to govern the financial and operating policies so as to be able to benefit from
these entities' activities. This power must be presently exercisable.
Controlled entities are fully consolidated. The consolidation begins at the
first date on which control exists, and ends when such control no longer
exists. The most common indicators of
control within the EU are: creation of the entity through founding treaties or
secondary legislation, financing of the entity from the general budget, the
existence of voting rights in the governing bodies, audit by the Court and
discharge by the European Parliament. It is clear that an assessment for each
entity needs to be made in order to decide whether one or all of the criteria
listed above are sufficient to trigger control. Under this approach, the EU's
institutions (except the European Central bank - ECB) and agencies (excluding
the agencies of the former 2nd pillar) are considered as under the exclusive
control of the EU and are therefore included in the consolidation scope.
Furthermore the European Coal and Steel Community (ECSC) in Liquidation is also
considered as a controlled entity. All material inter-company
transactions and balances between EU controlled entities are eliminated, while
unrealised gains and losses on inter-entity transactions are not material and
have therefore not been eliminated. JOINT VENTURES A joint venture is a contractual
arrangement whereby the EU and one or more parties (the "venturers")
undertake an economic activity which is subject to joint control. Joint control
is the contractually agreed sharing of control, directly or indirectly, over an
activity embodying service potential. Participations in joint ventures
are accounted for using the equity method initially recognised at cost. The
EU's interest in the results of its jointly controlled entities is recognised
in the statement of financial performance, and its interest in the movements in
reserves is recognised in the reserves. The initial cost plus all movements
(further contributions, share of economic results and reserve movements,
impairments, and dividends) give the book value of the joint venture in the
financial statements at the balance sheet date. Unrealised gains and losses on
transactions between the EU and its jointly controlled entities are not
material and have therefore not been eliminated. The accounting policies of
joint ventures may differ from those adopted by the EU for like transactions
and events in similar circumstances. ASSOCIATES Associates are entities over which
the EU has, directly or indirectly, significant influence but not control. It
is presumed that significant influence is given if the EU holds directly or
indirectly 20% or more of the voting rights. Participations in associates are
accounted for using the equity method, initially recognised at cost. The EU's
share of its associates' results is recognised in the statement of financial
performance, and its share of movements in reserves is recognised in the
reserves. The initial cost plus all movements (further contributions, share of
economic results and reserve movements, impairments, and dividends) give the
book value of the associate in the financial statements at the balance sheet
date. Distributions received from an associate reduce the carrying amount of
the asset. Unrealised gains and losses on transactions between the EU and its
associates are not material and have therefore not been eliminated. The accounting policies of
associates may differ from those adopted by the EU for like transactions and events
in similar circumstances. In cases where the EU holds 20% or more of an
investment capital fund, it does not seek to exert significant influence. Such
funds are therefore treated as financial instruments and categorised as
available for sale financial assets. NON-CONSOLIDATED ENTITIES THE FUNDS OF
WHICH ARE MANAGED BY THE COMMISSION The funds of the Sickness Insurance
Scheme for staff of the EU, the European Development Fund and the Participant's
Guarantee Fund are managed by the Commission on their behalf, however since
these entities are not controlled by the EU they are therefore not consolidated
in its financial statements – see note 11.2 of
the EU accounts for further details on the amounts concerned. 1.4. BASIS
OF PREPARATION 1.4.1. Currency and basis for conversion Functional and
reporting currency The financial statements are
presented in millions of euros, the euro being the EU's functional and
reporting currency. Transactions and
balances Foreign currency transactions are
translated into euros using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement
of foreign currency transactions and from the translation at year-end exchange
rates of monetary assets and liabilities denominated in foreign currencies are
recognised in the statement of financial performance. Different conversion methods apply
to property, plant and equipment and intangible assets, which retain their
value in euros at the rate that applied at the date when they were purchased. Year-end balances of monetary
assets and liabilities denominated in foreign currencies are converted into
euros on the basis of the exchange rates applying on 31 December: Euro exchange rates Currency || 31.12.2013 || 31.12.2012 || Currency || 31.12.2013 || 31.12.2012 BGN || 1.9558 || 1.9558 || LTL || 3.4528 || 3.4528 CZK || 27.4270 || 25.1510 || PLN || 4.1543 || 4.0740 DKK || 7.4593 || 7.4610 || RON || 4.4710 || 4.4445 GBP || 0.8337 || 0.8161 || SEK || 8.8591 || 8.5820 HRK || 7.6265 || 7.5575 || CHF || 1.2276 || 1.2072 HUF || 297.0400 || 292.3000 || JPY || 144.7200 || 113.6100 LVL || 0.7028 || 0.6977 || USD || 1.3791 || 1.3194 Changes in the
fair value of monetary financial instruments denominated in a foreign currency
and classified as available for sale that relate to a translation difference
are recognised in the statement of financial performance. Translation
differences on non-monetary financial assets and liabilities held at fair value
through profit or loss are recognised in the statement of financial
performance. Translation differences on non-monetary financial instruments
classified as available for sale are included in the fair value reserve. 1.4.2. Use of estimates In accordance with IPSAS and generally accepted accounting
principles, the financial statements necessarily include amounts based on
estimates and assumptions by management based on the most reliable information
available. Significant estimates include, but are not limited to; amounts for
employee benefit liabilities, provisions, financial risk on inventories and
accounts receivables, accrued income and charges, contingent assets and liabilities,
and degree of impairment of intangible assets and property, plant and
equipment. Actual results could differ from those estimates. Changes in
estimates are reflected in the period in which they become known. 1.5. BALANCE
SHEET 1.5.1. Intangible assets Acquired computer software licences
are stated at historical cost less accumulated amortisation and impairment
losses. The assets are amortised on a straight-line basis over their estimated
useful lives. The estimated useful lives of intangible assets depend on their
specific economic lifetime or legal lifetime determined by an agreement.
Internally developed intangible assets are capitalised when the relevant
criteria of the EU accounting rules are met. The costs capitalisable include
all directly attributable costs necessary to create, produce, and prepare the
asset to be capable of operating in the manner intended by management. Costs
associated with research activities, non-capitalisable development costs and
maintenance costs are recognised as expenses as incurred. 1.5.2. Property, plant and equipment All property, plant and equipment
are stated at historical cost less accumulated depreciation and impairment
losses. Historical cost includes expenditure that is directly attributable to
the acquisition or construction of the asset. Subsequent costs are included in
the asset’s carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits or service potential
associated with the item will flow to the EU and its cost can be measured
reliably. Repairs and maintenance costs are charged to the statement of
financial performance during the financial period in which they are incurred. Land and works of art are not
depreciated as they are deemed to have an indefinite useful life. Assets under
construction are not depreciated as these assets are not yet available for use.
Depreciation on other assets is calculated using the straight-line method to
allocate their cost to their residual values over their estimated useful lives,
as follows: Type of asset || Straight line depreciation rate Buildings || 4% Plant, machinery and equipment || 10% to 25% Furniture || 10% to 25% Fixtures and fittings || 10% to 33% Vehicles || 25% Computer hardware || 25% Other tangible assets || 10% to 33% Gains or losses on disposals are
determined by comparing proceeds less selling expenses with the carrying amount
of the disposed asset and are included in the statement of financial
performance. Leases Leases of tangible assets, where
the EU has substantially all the risks and rewards of ownership, are classified
as finance leases. Finance leases are capitalised at the inception of the lease
at the lower of the fair value of the leased asset and the present value of the
minimum lease payments. Each lease payment is allocated between the liability
and finance charges so as to achieve a constant rate on the finance balance
outstanding. The rental obligations, net of finance charges, are included in
other liabilities (non-current and current). The interest element of the
finance cost is charged to the statement of financial performance over the
lease period so as to produce a constant periodic interest rate on the
remaining balance of the liability for each period. The assets held under
finance leases are depreciated over the shorter of the assets' useful life and
the lease term. Leases where the lessor retains a
significant portion of the risks and rewards inherent to ownership are
classified as operating leases. Payments made under operating leases are
charged to the statement of financial performance on a straight-line basis over
the period of the lease. 1.5.3. Impairment of non-financial assets Assets that have an indefinite
useful life are not subject to amortisation/depreciation and are tested
annually for impairment. Assets that are subject to amortisation/depreciation
are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is
recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair
value less costs to sell and its value in use. Intangible assets and property, plant and equipment residual values
and useful lives are reviewed, and adjusted if appropriate, at least once per
year. An asset’s carrying amount is written down immediately to its recoverable
amount if the asset’s carrying amount is greater than its estimated recoverable
amount. If the reasons for impairments recognised in previous years no longer
apply, the impairment losses are reversed accordingly. 1.5.4. Investments Participations in associates and joint
ventures Participations in associates and
joint ventures are accounted for using the equity method. The costs of equity
are adjusted to reflect the share of increases or reductions in net assets of
the associates and joint ventures that are attributable to the EU after initial
recognition. If there are indications of impairment, a write-down to the lower
recoverable amount is necessary. The recoverable amount is determined as
described under 1.5.3. If the reason for
impairment ceases to apply at a later date, the impairment loss is reversed to
the carrying amount that would have been determined had no impairment loss been
recognised. Investments in venture capital funds Investments in Venture Capital
Funds are classified as available for sale financial assets (see 1.5.5) and accordingly, are carried at fair value
with gains and losses arising from changes in the fair value (including
translation differences) recognised in the fair value reserve. Since they do not have a quoted
market price in an active market, investments in Venture Capital Funds are
valued on a line-by-line basis at the lower of cost or attributable net asset
value (“NAV”). Unrealised gains resulting from the fair value measurement are
recognised through reserves and unrealised losses are assessed for impairment
so as to determine whether they are recognised as impairment losses in the
statement of financial performance or as changes in the fair value reserve. 1.5.5. Financial assets Classification The EU classifies their financial
assets in the following categories: financial assets at fair value through
profit or loss; loans and receivables; held-to-maturity investments; and
available for sale financial assets. The classification of the financial
instruments is determined at initial recognition and re-evaluated at each
balance sheet date. (i) Financial assets at fair value through profit or loss A financial asset is classified in
this category if acquired principally for the purpose of selling in the short
term or if so designated by the EU. Derivatives are also categorised in this
category. Assets in this category are classified as current assets if they are
expected to be realised within 12 months of the balance sheet date. During this
financial year, the EU did not hold any financial assets in this category. (ii) Loans and receivables Loans and receivables are
non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market. They arise when the EU provides money, goods or
services directly to a debtor with no intention of trading the receivable. They
are included in non-current assets, except for maturities within 12 months of
the balance sheet date. (iii) Held-to-maturity investments Held-to-maturity investments are
non-derivative financial assets with fixed or determinable payments and fixed
maturities that the EU has the positive intention and ability to hold to
maturity. During this financial year, the EU did not hold any investments in
this category. (iv) Available for sale financial assets Available for sale financial assets
are non-derivatives that are either designated in this category or not
classified in any of the other categories. They are classified as either
current or non-current assets, depending on the time period in which the EU
expects to dispose of them which is usually the remaining maturity at the
balance sheet date. Investments in unconsolidated entities and other equity investments
(e.g. Risk Capital Operations) that are not accounted for using the equity
method are also classified as available for sale financial assets. Initial recognition and measurement Purchases and sales of financial
assets at fair value through profit or loss, held-to-maturity and available for
sale are recognised on trade-date – the date on which the EU commits to
purchase or sell the asset. Loans are recognised when cash is advanced to the
borrowers. Financial instruments are initially recognised at fair value. For
all financial assets not carried at fair value through profit or loss
transactions costs are added to the fair value at initial recognition.
Financial assets carried at fair value through profit or loss are initially
recognised at fair value and transaction costs are expensed in the statement of
financial performance. The fair value of a financial asset
on initial recognition is normally the transaction price (i.e. the fair value
of the consideration received). However, when a long-term loan that carries no
interest or an interest below market conditions is granted, its fair value can
be estimated as the present value of all future cash receipts discounted using
the prevailing market rate of interest for a similar instrument with a similar
credit rating. Loans granted on borrowed funds are
measured at their nominal amount, which is considered to be the fair value of
the loan. The reasoning for this is as follows: –
The “market environment” for EU lending is very
specific and different from the capital market used to issue commercial or
government bonds. As lenders in these markets have the opportunity to choose
alternative investments, the opportunity possibility is factored into market
prices. However, this opportunity for alternative investments does not exist
for the EU which is not allowed to invest money on the capital markets; it only
borrows funds for the purpose of lending at the same rate. This means that
there is no alternative lending or investment option available to the EU for
the sums borrowed. Thus, there is no opportunity cost and therefore no basis of
comparison with market rates. In fact, the EU lending operation itself
represents the market. Essentially, since the opportunity cost
"option" is not applicable, the market price does not fairly reflect
the substance of the EU lending transactions. Therefore, it is not appropriate
to determine the fair value of EU lending with reference to commercial or
government bonds. –
Furthermore as there is no active market or
similar transactions to compare with, the interest rate to be used by the EU
for fair valuing its lending operations under the European Financial Stability
Mechanism (EFSM), Balance of Payment (BOP) and other such loans, should be the
interest rate charged. –
In addition, for these loans, there are
compensating effects between loans and borrowings due to their back-to-back
character. Thus, the effective interest for the loan equals the effective
interest rate for the related borrowings. The transaction costs incurred by the
EU and then recharged to the beneficiary of the loan are directly recognised in
the statement of financial performance. Financial instruments are
derecognised when the rights to receive cash flows from the investments have
expired or have been transferred and the EU has transferred substantially all
risks and rewards of ownership. Subsequent measurement (i)
Financial assets at fair value through profit or
loss are subsequently carried at fair value. Gains and losses arising from
changes in the fair value of the ‘financial instruments at fair value through
profit or loss’ category are included in the statement of financial performance
in the period in which they arise. (ii)
Loans and receivables and held-to-maturity
investments are carried at amortised cost using the effective interest method.
In the case of loans granted on borrowed funds, the same effective interest
rate is applied to both the loans and borrowings since these loans have the
characteristics of 'back-to-back operations' and the differences between the
loan and the borrowing conditions and amounts are not material. The transaction
costs incurred by the EU and then recharged to the beneficiary of the loan are
directly recognised in the statement of financial performance. (iii)
Held to maturity – the EU currently holds no
held to maturity investments. (iv)
Available for sale financial assets are
subsequently carried at fair value. Gains and losses arising from changes in
the fair value of available for sale financial assets are recognised in the
fair value reserve. When assets classified as available for sale financial
assets are sold or impaired, the cumulative fair value adjustments previously
recognised in the fair value reserve are recognised in the statement of
financial performance. Interest on available for sale financial assets
calculated using the effective interest method is recognised in the statement
of financial performance. Dividends on available for sale equity instruments
are recognised when the EU's right to receive payment is established. The fair values of quoted
investments in active markets are based on current bid prices. If the market
for a financial asset is not active (and for unlisted securities), the EU
establishes a fair value by using valuation techniques. These include the use
of recent arm’s length transactions, reference to other instruments that are
substantially the same, discounted cash flow analysis, option pricing models
and other valuation techniques commonly used by market participants. In cases where the fair value of
investments in equity instruments that do not have quoted market price in an
active market cannot be reliably measured, these investments are valued at cost
less impairment losses. Impairment of financial assets The EU assesses at each balance
sheet date whether there is objective evidence that a financial asset is
impaired. A financial asset is impaired and impairment losses are incurred if,
and only if, there is objective evidence of impairment as a result of one or
more events that occurred after the initial recognition of the asset and that
loss event (or events) has an impact on the estimated future cash flows of the
financial asset that can be reliably estimated. (a) Assets carried at amortised cost If there is objective evidence that
an impairment loss on loans and receivables or held-to-maturity investments
carried at amortised cost has been incurred, the amount of the loss is measured
as the difference between the asset’s carrying amount and the present value of
estimated future cash flows (excluding future credit losses that have not been
incurred) discounted at the financial asset’s original effective interest rate.
The carrying amount of the asset is reduced and the amount of the loss is
recognised in the statement of financial performance. If a loan or
held-to-maturity investment has a variable interest rate, the discount rate for
measuring any impairment loss is the current effective interest rate determined
under the contract. The calculation of the present value of the estimated
future cash flows of a collateralised financial asset reflects the cash flows
that may result from foreclosure less costs for obtaining and selling the
collateral, whether or not foreclosure is probable. If, in a subsequent period,
the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognised, the
previously recognised impairment loss is reversed through the statement of
financial performance. (b) Assets
carried at fair value In the case of equity investments
classified as available for sale financial assets, a significant or permanent
(prolonged) decline in the fair value of the security below its cost is
considered in determining whether the securities are impaired. If any such
evidence exists for available for sale financial assets, the cumulative loss –
measured as the difference between the acquisition cost and the current fair
value, less any impairment loss on that financial asset previously recognised
in the statement of financial performance – is removed from reserves and
recognised in the statement of financial performance. Impairment losses
recognised in the statement of financial performance on equity instruments are
not reversed through the statement of financial performance. If, in a
subsequent period, the fair value of a debt instrument classified as available
for sale financial asset increases and the increase can be objectively related
to an event occurring after the impairment loss was recognised, the impairment
loss is reversed through the statement of financial performance. 1.5.6. Inventories Inventories are stated at the lower
of cost and net realisable value. Cost is determined using the first-in,
first-out (FIFO) method. The cost of finished goods and work in progress
comprises raw materials, direct labour, other directly attributable costs and
related production overheads (based on normal operating capacity). Net
realisable value is the estimated selling price in the ordinary course of
business, less the costs of completion and selling expenses. When inventories
are held for distribution at no charge or for a nominal charge, they are
measured at the lower of cost and current replacement cost. Current replacement
cost is the cost the EU would incur to acquire the asset on the reporting date. 1.5.7. Pre-financing amounts Pre-financing is a payment intended
to provide the beneficiary with a cash advance, i.e. a float. It may be split
into a number of payments over a period defined in the particular pre-financing
agreement. The float or advance is repaid or used for the purpose for which it
was provided during the period defined in the agreement. If the beneficiary
does not incur eligible expenditures, he has the obligation to return the
pre-financing advance to the EU. The amount of the pre-financing is reduced (wholly
or partially) by the acceptance of eligible costs (which are recognised as
expenses) and amounts returned. At year-end, outstanding
pre-financing amounts are valued at the original amount(s) paid less: amounts
returned, eligible amounts expensed, estimated eligible amounts not yet cleared
at year-end, and value reductions. Interest on pre-financing is
recognised as it is earned in accordance with the provisions of the relevant
agreement. An estimate of the accrued interest revenue, based on the most reliable
information, is made at the year-end and included in the balance sheet. 1.5.8. Receivables Receivables are carried at original
amount less write-down for impairment. A write-down for impairment of
receivables is established when there is objective evidence that the EU will
not be able to collect all amounts due according to the original terms of
receivables. The amount of the write-down is the difference between the asset’s
carrying amount and the recoverable amount. The amount of the write-down is recognised
in the statement of financial performance. A general write-down, based on past
experience, is also made for outstanding recovery orders not already subject to
a specific write-down. See note 1.5.14 below
concerning the treatment of accrued income at year-end. 1.5.9. Cash and cash equivalents Cash and cash equivalents are
financial instruments and classified as available for sale financial assets.
They include cash at hand, deposits held at call with banks, other short-term
highly liquid investments with original maturities of three months or less. 1.5.10. Pension
and other employee benefits Pension obligations The EU operates defined benefit
pension plans. Whilst staff contribute from their salaries one third of the
expected cost of these benefits, the liability is not funded. The liability
recognised in the balance sheet in respect of defined benefit pension plans is
the present value of the defined benefit obligation at the balance sheet date.
The defined benefit obligation is calculated by actuaries using the projected
unit credit method. The present value of the defined benefit obligation is
determined by discounting the estimated future cash outflows using interest
rates of government bonds that are denominated in the currency in which the
benefits will be paid, and that have terms to maturity approximating to the
terms of the related pension liability. Actuarial gains and losses arising from experience adjustments and
changes in actuarial assumptions are recognised immediately in the statement of
financial performance. Past-service costs are recognised immediately in
statement of financial performance, unless the changes to the pension plan are
conditional on the employees remaining in service for a specified period of
time (the vesting period). In this case, the past-service costs are amortised
on a straight-line basis over the vesting period. Post-employment
sickness benefits The EU provides health benefits to
its employees through the reimbursement of medical expenses. A separate fund
has been created for its day-to-day administration. Both current employees,
pensioners, widowers and their beneficiaries benefit from the system. The
benefits granted to the "inactives" (pensioners, orphans, etc.) are
classified as "Post-Employment Employee Benefits". Given the nature
of these benefits, an actuarial calculation is required. The liability in the
balance sheet is determined on a similar basis as that for the pension
obligations (see above). 1.5.11. Provisions Provisions are recognised when the
EU has a present legal or constructive obligation towards third parties as a
result of past events, it is more likely than not that an outflow of resources
will be required to settle the obligation, and the amount can be reliably
estimated. Provisions are not recognised for future operating losses. The
amount of the provision is the best estimate of the expenditures expected to be
required to settle the present obligation at the reporting date. Where the
provision involves a large number of items, the obligation is estimated by
weighting all possible outcomes by their associated probabilities (“expected
value” method). 1.5.12. Financial
liabilities Financial liabilities are
classified as financial liabilities at fair value through profit or loss or as
financial liabilities carried at amortised cost (borrowings). Borrowings are
composed of borrowings from credit institutions and debts evidenced by
certificates. They are recognised initially at fair value, being their issue
proceeds (fair value of consideration received) net of transaction costs incurred,
then subsequently carried at amortised cost using the effective interest
method; any difference between proceeds, net of transaction costs, and the
redemption value is recognised in the statement of financial performance over
the period of the borrowings using the effective interest method. They are classified as non-current
liabilities, except for maturities less than 12 months after the balance sheet
date. In the case of loans granted on borrowed funds, the effective interest
method may not be applied to loans and borrowings, based on materiality
considerations. The transaction costs incurred by the EU and then recharged to
the beneficiary of the loan are directly recognised in the statement of
financial performance. Financial liabilities categorised
at fair value through profit or loss include derivatives when their fair value
is negative. They follow the same accounting treatment as financial assets at
fair value through profit or loss, see note 1.5.5. During this financial
year, the EU did not hold any financial liabilities in this category. 1.5.13. Payables A significant amount of the
payables of the EU are not related to the purchase of goods or services –
instead they are unpaid cost claims from beneficiaries of grants or other EU
funding. They are recorded as payables for the requested amount when the cost
claim is received. Upon verification and acceptance of the eligible costs, the
payables are valued at the accepted and eligible amount. Payables arising from the purchase
of goods and services are recognised at invoice reception for the original
amount and corresponding expenses are entered in the accounts when the supplies
or services are delivered and accepted by the EU. 1.5.14. Accrued
and deferred income and charges According to the EU accounting rules,
transactions and events are recognised in the financial statements in the
period to which they relate. At the end of the accounting period, accrued
expenses are recognised based on an estimated amount of the transfer obligation
of the period. The calculation of accrued expenses is done in accordance with
detailed operational and practical guidelines issued by the Commission which
aim at ensuring that the financial statements reflect a true and fair view. Revenue is also accounted for in
the period to which it relates. At year-end, if an invoice is not yet issued
but the service has been rendered, the supplies have been delivered by the EU
or a contractual agreement exists (i.e. by reference to a treaty), an accrued
income will be recognised in the financial statements. In addition, at year-end, if an
invoice is issued but the services have not yet been rendered or the goods
supplied have not yet been delivered, the revenue will be deferred and
recognised in the subsequent accounting period. 1.6. STATEMENT
OF FINANCIAL PERFORMANCE 1.6.1. Revenue NON-EXCHANGE REVENUE This makes up the vast majority of
the EU's revenue and includes mainly direct and indirect taxes and own resource
amounts. In addition to taxes the EU may also receive payments from other
parties, such as duties, fines and donations. GNI based resources and VAT
resources Revenue is recognised for the
period for which the Commission sends out a call for funds to the Member States
claiming their contribution. They are measured at their “called amount”. As VAT
and GNI resources are based on estimates of the data for the budgetary year
concerned, they may be revised as changes occur until the final data are issued
by the Member States. The effect of a change in estimate is included when
determining the net surplus or deficit for the period in which the change
occurred. Traditional own resources Receivables and related revenues
are recognised when the relevant monthly "A" statements (including
duties collected and amounts due that are guaranteed and not contested) are
received from the Member States. At the reporting date, revenue collected by
the Member States for the period but not yet paid to the Commission is
estimated and recognised as accrued revenue. The quarterly "B"
statements (including duties neither collected nor guaranteed, as well as
guaranteed amounts that have been contested by the debtor) received from the
Member States are recognised as revenue less the collection costs to which they
are entitled (25%). In addition, a value reduction is recognised for the amount
of the estimated recovery gap. Fines Revenue from fines is recognised
when the EU's decision imposing a fine has been taken and it is officially
notified to the addressee. If there are doubts about the undertaking's
solvency, a value reduction on the entitlement is recognised. After the
decision to impose a fine, the debtors have two months from the date of
notification: – either to accept the decision, in which case they must pay the fine
within the time limit laid down and the amount is definitively collected by the
EU; – or not to accept the decision, in which case they lodge an appeal
under EU law. However, even if appealed, the
principal of the fine must be paid within the time limit of three months laid
down as the appeal does not have suspensory effect (Article 278 of the EU
Treaty) or, under certain circumstances and subject to the agreement of the
Commission's Accounting Officer, it may present a bank guarantee for the amount
instead. If the undertaking appeals against
the decision, and has already provisionally paid the fine, the amount is
disclosed as a contingent liability. However, since an appeal against an EU
decision by the addressee does not have suspensory effect, the cash received is
used to clear the receivable. If a guarantee is received instead of payment,
the fine remains as a receivable. If it appears probable that the General Court
may not rule in favour of the EU, a provision is recognised to cover this risk.
If a guarantee had been given instead, then the receivable outstanding is
written-down as required. The accumulated interest received by the Commission
on the bank accounts where received payments are deposited is recognised as
revenue, and any contingent liability is increased accordingly. Since 2010, all provisionally
cashed fines are managed by the Commission in a specifically created fund
(BUFI) and invested in financial instruments categorised as available for sale. EXCHANGE REVENUE Revenue from the sale of goods and
services is recognised when the significant risk and rewards of ownership of
the goods are transferred to the purchaser. Revenue associated with a
transaction involving the provision of services is recognised by reference to
the stage of completion of the transaction at the reporting date. INTEREST INCOME AND EXPENSE Interest income and expense are
recognised in the statement of financial performance using the effective
interest method. This is a method of calculating the amortised cost of a
financial asset or a financial liability and of allocating the interest income
or interest expense over the relevant period. When calculating the effective
interest rate, the EU estimates cash flows considering all contractual terms of
the financial instrument (for example, prepayment options) but does not consider
future credit losses. The calculation includes all fees and points paid or
received between parties to the contract that are an integral part of the
effective interest rate, transaction costs and all other premiums or discounts. Once a financial asset or a group
of similar financial assets has been written down as a result of an impairment
loss, interest income is recognised using the rate of interest to discount the
future cash flows for the purpose of measuring the impairment loss. DIVIDEND INCOME Dividend income is recognised when
the right to receive payment is established. 1.6.2. Expenses Exchange expenses arising from the
purchase of goods and services are recognised when the supplies are delivered
and accepted by the EU. They are valued at original invoice cost. Non-exchange expenses account for
the majority of the EU's expenses. They relate to transfers to beneficiaries
and can be of three types: entitlements, transfers under agreement and
discretionary grants, contributions and donations. Transfers are recognised as
expenses in the period during which the events giving rise to the transfer
occurred, as long as the nature of the transfer is allowed by regulation
(Financial Regulation, Staff Regulations, or other regulation) or a contract
has been signed authorising the transfer; any eligibility criteria have been
met by the beneficiary; and a reasonable estimate of the amount can be made. When a request for payment or cost
claim is received and meets the recognition criteria, it is recognised as an
expense for the eligible amount. At year-end, incurred eligible expenses due to
the beneficiaries but not yet reported are estimated and recorded as accrued
expenses. 1.7. CONTINGENT
ASSETS AND LIABILITIES 1.7.1.
Contingent assets A contingent asset is a possible
asset that arises from past events and of which the existence will be confirmed
only by the occurrence or non-occurrence of one or more uncertain future events
not wholly within the control of the EU. A contingent asset is disclosed when
an inflow of economic benefits or service potential is probable. 1.7.2.
Contingent liabilities A contingent liability is a
possible obligation that arises from past events and of which the existence
will be confirmed only by the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control of the EU; or a present
obligation that arises from past events but is not recognised because: it is
not probable that an outflow of resources embodying economic benefits or
service potential will be required to settle the obligation or, in the rare
circumstances where the amount of the obligation cannot be measured with
sufficient reliability. 2.
NOTES TO THE BALANCE SHEET NON-CURRENT
ASSETS 2.1. INTANGIBLE
ASSETS || EUR millions || Gross carrying amount at previous year-end || 113 Additions || 31 Disposals || (11) Transfer between categories || 0 Other changes || 2 || Gross carrying amount at year-end || 135 || Accumulated amortisation at previous year-end || (52) Amortisation charge for the year || (9) Disposals || 6 Transfer between categories || 0 Other changes || 0 || Accumulated amortisation at year-end || (57) || Net carrying amount 31.12.2013 || 78 || Net carrying amount 31.12.2012 || 61 The above
amounts relate primarily to computer software. 2.2. PROPERTY,
PLANT AND EQUIPMENT Included under assets under
construction at 31 December 2013 are EUR 1 041 million (2012: EUR 660 million) of assets relating to the Galileo project,
the EU's Global Navigation Satellite System (GNSS), being built with the
assistance of the European Space Agency (ESA). An amount of EUR 13 million of
non-capitalisable development costs has been recognised as expenses during the
period. Property, plant and equipment || || || || || || || || EUR millions || Land and buildings || Plant and equipment || Furniture and vehicles || Computer hardware || Other PPE || Finance leases || Assets under construction || TOTAL Gross carrying amount at previous year-end || 1 263 || 313 || 69 || 253 || 118 || 1 511 || 743 || 4 270 Additions || 14 || 33 || 4 || 22 || 12 || 7 || 449 || 540 Disposals || 0 || (13) || (7) || (49) || (6) || 0 || - || (75) Transfer between asset categories || 0 || 11 || 1 || 2 || (1) || (2) || (11) || 0 Other changes || 0 || 0 || 2 || 1 || 1 || 0 || 1 || 5 Gross carrying amount at year-end || 1 277 || 344 || 69 || 229 || 124 || 1 515 || 1 182 || 4 739 Accumulated depreciation at previous year-end || (665) || (265) || (52) || (212) || (88) || (500) || || (1 782) Depreciation charge for the year || (33) || (19) || (4) || (21) || (9) || (54) || || (139) Disposals || 0 || 13 || 7 || 45 || 6 || 0 || || 71 Transfer between asset categories || - || 0 || (1) || (2) || 1 || 2 || || 0 Other changes || 0 || 0 || (1) || 0 || 0 || 0 || || (2) Accumulated depreciation at year-end || (697) || (271) || (51) || (189) || (91) || (552) || || (1 851) || || || || || || || || NET CARRYING AMOUNT AT 31.12.2013 || 579 || 73 || 18 || 40 || 33 || 963 || 1 182 || 2 888 NET CARRYING AMOUNT AT 31.12.2012 || 598 || 48 || 17 || 41 || 30 || 1 011 || 743 || 2 488 finance
leases Charges still to be paid in respect of finance leases and similar
entitlements are shown in non-current and current liabilities in the balance
sheet (see notes 2.15 and 2.18.3). || || || || || || || || || || EUR millions Description || Cumulative charges || Future amounts to be paid || Total value || Subsequent expenses on assets || Asset value || Depreciation || Net carrying amount (A+B+C+D) || (A) || < 1 year || > 1 year || > 5 years || Total liability (B) || (A+B) || (C) || (A+B+C) || (D) || Land and buildings || 302 || 38 || 190 || 885 || 1 113 || 1 415 || 62 || 1 478 || (528) || 950 Other tangible assets || 23 || 6 || 9 || - || 14 || 37 || - || 37 || (24) || 14 Total at 31.12.2013 || 325 || 44 || 199 || 885 || 1 128 || 1 453 || 62 || 1 515 || (552) || 963 Interest element || 63 || 227 || 342 || 632 || || || || || Total future minimum lease payments at 31.12.2013 || 107 || 426 || 1 227 || 1 760 || || || || || Total future minimum lease payments at 31.12.2012 || 108 || 424 || 1 363 || 1 895 || || || || || 2.3. INVESTMENTS
ACCOUNTED FOR USING THE EQUITY METHOD || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Participations in joint ventures || 2.3.1 || 0 || 42 Participations in associates || 2.3.2 || 349 || 350 Total || || 349 || 392 2.3.1. Participations in joint ventures || || || || || || EUR millions || GJU || SESAR || ITER || IMI || FCH || Total Amount at 31.12.2012 || 0 || 0 || 10 || 32 || 0 || 42 Contributions || 0 || 78 || 121 || 126 || 56 || 380 Share of net result || 0 || (78) || (130) || (158) || (56) || (422) Amount at 31.12.2013 || 0 || 0 || 0 || 0 || 0 || 0 Participations in joint ventures
are accounted for using the equity method. The following carrying amounts are
attributable to the Commission based on its percentage of participation: || || EUR millions || 31.12.2013 || 31.12.2012 Non-current assets || 198 || 226 Current assets || 63 || 106 Non-current liabilities || 0 || 0 Current liabilities || (394) || (291) Revenue || 1 || 8 Expenses || (412) || (427) 2.3.2.
Participations in associates || || || || || EUR millions || EIF || ARTEMIS || Clean Sky || ENIAC || Total Amount at 31.12.2012 || 336 || 0 || 0 || 14 || 350 Contributions || (2) || 20 || 125 || 37 || 180 Share of net result || 9 || (20) || (125) || (50) || (186) Other equity movements || 6 || 0 || 0 || 0 || 6 Amount at 31.12.2013 || 349 || 0 || 0 || 0 || 349 Participations in associates are
accounted for using the equity method. The following carrying amounts are
attributable to the Commission based on its percentage of participation: || || EUR millions || 31.12.2013 || 31.12.2012 Assets || 499 || 505 Liabilities || (240) || (191) Revenue || 37 || 33 Surplus/(Deficit) || (221) || (177) European Investment Fund The European Investment Fund (EIF)
is the EU's financial institution specialising in providing risk capital and
guarantees to SMEs. The Commission has paid in 20% of its participation, the
balance being uncalled corresponding to an amount of EUR 720 million. || || EUR millions || Total EIF capital || Commission subscription Total Share Capital || 3 000 || 900 Paid-in || (600) || (180) Uncalled || 2 400 || 720 2.4. NON-CURRENT
FINANCIAL ASSETS || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Available for sale financial assets || 2.4.1 || 4 367 || 3 715 Loans || 2.4.2 || 54 123 || 57 205 Total || || 58 490 || 60 920 2.4.1. Non-current available
for sale financial assets || || EUR millions || 31.12.2013 || 31.12.2012 Guarantee Fund (GF)* || 1 412 || 1 327 BUFI investments || 1 013 || 832 Risk Sharing Finance Facility (RSFF) || 789 || 594 Loan Guarantee Instrument for TEN-T projects (LGTT) || 90 || 52 European Bank for Reconstruction and Development (EBRD) || 188 || 188 Risk Capital Operations || 124 || 123 ETF Start up || 339 || 305 Other available for sale investments || 412 || 294 Total || 4 367 || 3 715 *After elimination of the EFSM bonds 2.4.2. Non-current loans || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Loans granted from the EU budget || 2.4.2.1 || 138 || 147 Loans granted from borrowed funds || 2.4.2.2 || 53 984 || 57 058 Total || || 54 123 || 57 205 2.4.2.1. Loans granted from the EU budget || EUR millions || Total Total at 31.12.2012 || 146 New loans || 4 Repayments || (18) Exchange differences || (6) Changes in carrying amount || 12 Total at 31.12.2013 || 138 This item covers loans with
special conditions granted at preferential rates as part of co-operation with
non-member countries. All amounts fall due more than 12 months after year-end.
The effective interest rates on these loans vary between 7.73% and 14.507%. 2.4.2.2. Loans granted from borrowed funds || || || || || EUR millions || MFA || Euratom || BOP || EFSM || Total Total at 31.12.2012 || 549 || 425 || 11 623 || 44 476 || 57 073 New loans || 100 || - || - || - || 100 Repayments || (81) || (36) || - || - || (117) Exchange differences || - || (1) || - || - || (1) Changes in carrying amount || 1 || (1) || - || (8) || (8) Total at 31.12.2013 || 569 || 387 || 11 623 || 44 468 || 57 047 || || || || || Amount due < 1 year || 31 || - || 3 033 || - || 3 064 || || || || || Amount due > 1 year || 538 || 387 || 8 590 || 44 468 || 53 983 The effective interest rates
(expressed as a range of interest rates) were as follows: Loans || 31.12.2013 || 31.12.2012 Macro Financial Assistance (MFA) || 0.27%-4.54% || 0.298%-4.54% Euratom || 0.34%-5.76% || 0.431%-5.76% Balance of Payment (BOP) || 2.375%-3.625% || 2.375%-3.625% European Financial Stability Mechanism (EFSM) || 2.375%-3.750% || 2.375%-3.750% For more information on borrowing
and lending activities, see note 2.14 and note 7 of the EU
consolidated annual accounts. BALANCE OF PAYMENT (BOP) LOANS – NOMINAL
VALUE || || || || EUR millions || Hungary || Latvia || Romania || Total Total loans granted || 6 500 || 3 100 || 8 400 || 18 000 Disbursed at 31.12.12 || 5 500 || 2 900 || 5 000 || 13 400 Disbursed in 2013 || 0 || 0 || 0 || 0 Loans disbursed 31.12.2013 || 5 500 || 2 900 || 5 000 || 13 400 Loans repaid at 31.12.2013 || (2 000) || 0 || 0 || (2 000) Outstanding amount at 31.12.2013 || 3 500 || 2 900 || 5 000 || 11 400 Undrawn amounts 31.12.2013 || 0 || 0 || 0 || 0 The BOP
assistance programme for Hungary, Latvia and Romania has expired and there are
no undrawn amounts at 31 December 2013. EUROPEAN FINANCIAL STABILITY MECHANISM
(EFSM) LOANS – NOMINAL VALUE || || || EUR millions || Ireland || Portugal || Total Total loans granted || 22 500 || 26 000 || 48 500 Disbursed at 31.12.12 || 21 700 || 22 100 || 43 800 Disbursed in 2013 || 0 || 0 || 0 Loans disbursed at 31.12.13 || 21 700 || 22 100 || 43 800 Loans repaid at 31.12.13 || 0 || 0 || 0 Loans outstanding at 31.12.13 || 21 700 || 22 100 || 43 800 Undrawn amounts at 31.12.13 || 800 || 3 900 || 4 700 On 25 March 2014,
EUR 2.6 billion was disbursed under EFSM (EUR 0.8 billion for Ireland and EUR 1.8 billion for Portugal). 2.5. NON-CURRENT
RECEIVABLES AND RECOVERABLES || || EUR millions || 31.12.2013 || 31.12.2012 Member States || 478 || 545 Due from ECSC in Liquidation || 48 || 48 Other || 4 || 2 Total || 529 || 595 Of the total
non-current receivables, EUR 525 million (2012: 593 million) relates to
non-exchange transactions. The amounts due from Member States relate to
non-executed conformity clearance decisions for EAGF and EAFRD. 2.6. NON-CURRENT
PRE-FINANCING || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Pre-financing || 2.6.1 || 34 742 || 40 772 Prepaid expenses || 2.6.2 || 3 253 || 3 715 Total || || 37 995 || 44 487 Guarantees
received in respect of pre-financing These are guarantees that the
Commission requests from beneficiaries that are not Member States in certain
cases when paying out advance payments (pre-financing). There are two values to
disclose for this type of guarantee, the “nominal” and the “on-going” values.
For the “nominal” value, the generating event is linked to the existence of the
guarantee. For the “on-going” value, the guarantee’s generating event is the
pre-financing payment and/or subsequent clearings. At 31 December 2013 the
"nominal" value of guarantees received in respect of pre-financing
amounted to EUR 1 124 million while the "on-going" value of those
guarantees was EUR 887 million (2012: EUR 1 220 million and EUR 955 million
respectively). 2.6.1.
Pre-financing The breakdown of pre-financing
amounts by management types is given below, noting that Article 58 of the new
Financial Regulation, which partly revised the methods of implementation of the
budget, shall only apply as of 1 January 2014: || || EUR millions || 31.12.2013 || 31.12.2012 Direct centralised management || 1 526 || 1 247 Indirect centralised management || 772 || 1 042 Decentralised management || 646 || 677 Shared management || 31 104 || 37 214 Joint management || 694 || 592 Total || 34 742 || 40 772 The most
significant non-current pre-financing amounts relate to structural actions for
the 2007-2013 programming period: the regional devlopment fund (ERDF) and the
cohesion fund (CF) EUR 19.6 billion, the social fund (ESF) EUR 5.6 billion, the
agricultural fund for rural development (EAFRD) EUR 5.2 billion and the
fisheries fund (EFF) EUR 0.6 billion. As many of these projects are long-term
in nature, it is necessary that the related advances are available for more
than one year. Thus these pre-financings are shown as non-current assets. The programming
period 2007-2013 is approaching its closing phase and thus the related
pre-financings gradually become due within twelve months. Therefore, the
non-current pre-financing amount is decreasing while the current pre-financing
amount is increasing (see also note 2.10.1). 2.6.2.
Prepaid expenses || || EUR millions || 31.12.2013 || 31.12.2012 Financial Engineering Instruments || 2 118 || 2 717 Aid Schemes || 1 135 || 998 Total || 3 253 || 3 715 Under the
framework of the structural funds programmes 2007-2013, payments can be made
from the EU budget to Member States so as to contribute to Financial
Engineering Instruments (be it in the form of loans, equity investments or
guarantees) set up and managed under the responsibility of the Member States.
Monies that are unused by these instruments at year-end are the property of the
EU (as with standard pre-financing) and are thus treated as an asset on the
Commission’s balance sheet. However, the basic legal acts do not oblige the
Member States to provide periodic reports to the Commission on the use made of
these advances, and in some cases not even identify them in the statements of
expenditure submitted to the Commission. Thus, and on the basis of information
received from Member States on the utilisation of funds, an estimation is made
at each year-end of the value of this asset. Similar to the above, advances paid
by the Member States that were not used at year end are recorded as assets on
the Commission's balance sheet. Member States may pay such advances for various
aid schemes (state aid, market measures of EAGF). The Commission has estimated
the value of these advances based on information provided by the Member States;
the resulting amounts are included under the Aid Schemes heading. CURRENT ASSETS 2.7. INVENTORIES || || EUR millions || 31.12.2013 || 31.12.2012 Scientific materials || 70 || 71 Other || 15 || 14 Total || 85 || 85 2.8. CURRENT
FINANCIAL ASSETS || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Available for sale financial assets || 2.8.1 || 1 730 || 1 300 Loans || 2.8.2 || 3 090 || 38 Total || || 4 821 || 1 338 2.8.1. Current available for sale financial assets Available for sale financial
assets are purchased for their investment return or yield, or held to establish
a particular asset structure or a secondary source of liquidity and may
therefore be sold in response to needs for liquidity or changes in interest
rates. The following table provides an overview of available for sale financial
assets with a remaining maturity before end 2014: || || EUR millions || 31.12.2013 || 31.12.2012 Guarantee Fund || 361 || 268 BUFI investments || 897 || 845 Risk Sharing Finance Facility (RSFF) || 408 || 160 Loan Guarantee Instrument for TEN-T projects (LGTT) || 31 || 23 Other available for sale investments || 33 || 4 Total || 1 730 || 1 300 2.8.2. Current loans Included under this heading are
mainly loans with remaining final maturities less than 12 months after the
balance sheet date (see note 2.4.2.2 above for more details). The increase compared to last year is due
to repayments of BOP loans scheduled for 2014 (Hungary EUR 2 billion and Latvia
EUR 1 billion). 2.9. CURRENT
RECEIVABLES AND RECOVERABLES || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Fines || 2.9.1 || 4 071 || 4 090 Member States || 2.9.2 || 5 509 || 6 222 Accrued income and deferred charges || 2.9.3 || 2 875 || 3 214 Other receivables & recoverables || 2.9.4 || 551 || 396 Total || || 13 007 || 13 922 The total above contains an estimated
EUR 12 681 million (2012: EUR 13 842 million) relating to non-exchange
transactions. 2.9.1.
Fines This concerns amounts to be recovered relating to fines issued by
the Commission of
EUR 4 310 million (2012: EUR 4 357 million) less a write-down of EUR 239
million (2012:EUR 267 million). Guarantees totalling EUR 3 244 million had been
received for the fines outstanding at year-end (2012: EUR 2 513 million). It
should be noted that EUR 1 032 million of these receivables were due for
payment after 31 December 2013. 2.9.2.
Member States || || EUR millions || 31.12.2013 || 31.12.2012 EAGF and Rural Development receivables || || European Agricultural Guarantee Fund (EAGF) || 1 858 || 1 172 European Agricultural Fund for Rural Development (EAFRD) || 41 || 14 Temporary Rural Development Instrument (TRDI) || 45 || 44 Special Accession Programme for Agriculture and Rural Development (SAPARD) || 155 || 136 Write-down || (819) || (814) || 1 279 || 552 || || VAT paid and recoverable || 20 || 15 || || Own resources || || Established in the A account || 47 || 45 Established in the separate account || 1 228 || 1 294 Own resources to be received || 3 054 || 3 617 Write-down || (743) || (773) Other || 6 || 16 || 3 592 || 4 199 || || Other receivables from Member States || || Pre-financing recovery expected || 542 || 1 220 Other || 77 || 236 || 618 || 1 456 || || Total || 5 509 || 6 222 The amount of
own resources to be received relates to the Amending Budget 8/2013 adopted on
20 November 2013. According to Article 10 of Council Regulation 1150/2000 of 22
May 2000 (OJ L 130, 31.5.2000, p. 1) the entries corresponding to the
readjustments of GNI contributions were carried out on the first working day of
January 2014. It is to be noted that certain Member States have anticipated
their payments, which explains why the amount to be received is lower than the
contribution requested in this amending budget. 2.9.3. Accrued income and deferred charges || || EUR millions || 31.12.2013 || 31.12.2012 Accrued income || 2 651 || 2 988 Deferred charges || 216 || 215 Other || 8 || 11 Total || 2 875 || 3 214 The main amount under this
heading is accrued income: || || EUR millions || 31.12.2013 || 31.12.2012 Own resources || 2 424 || 2 388 Agricultural assigned revenue November and December || 0 || 218 Cohesion, Regional & Rural Development Funds: financial corrections || 31 || 276 Other accrued income || 195 || 106 Total || 2 651 || 2 988 The accrued own resource income of
EUR 2 424 million mainly represents accrued custom duties of November and
December 2013. It should be noted that
agricultural assigned revenue for November and December (EUR 131 million) are
now disclosed under current receivables. 2.9.4. Other receivables and recoverables Included under this heading are
mainly recovery of pre-financing amounts, recovery of expenses as well as other
revenue from administrative and operational actions. 2.10. CURRENT
PRE-FINANCING || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Pre-financing || 2.10.1 || 16 225 || 9 458 Prepaid expenses || 2.10.2 || 4 963 || 3 690 Total || || 21 189 || 13 148 2.10.1.
Pre-financing The breakdown of
pre-financing amounts by management types is given below, noting that Article
58 of the new Financial Regulation, which partly revised the methods of
implementation of the budget, shall only apply as of 1 January 2014: || || EUR millions || 31.12.2013 || 31.12.2012 Direct centralised management || 3 924 || 3 369 Indirect centralised management || 4 770 || 3 936 Decentralised management || 250 || 301 Shared management || 6 263 || 1 008 Joint management || 1 018 || 844 Total || 16 225 || 9 458 The increase
in current pre-financing is mostly related to shared management. As explained
under note 2.6 the structural funds programs are entering in the final
phase of the programming period 2007-2013. As a consequence a large portion
(EUR 6.1 billion) of previously non-current pre-financing became current at 31
December 2013. There is also an increase under
direct centralised management and indirect centralised management. In both
cases, this increase is mostly due to the final phase of the 7th
Research Framework Programme for research and technological development (FP7)
which is marked by the signing of the last agreements leading to new
pre-financing payments of approximately EUR 2.8 billion under direct
centralised management and EUR 1.4 billion under indirect centralised
management. In parallel, projects under older agreements have been completed
and the related pre-financing payments have been cleared. 2.10.2.
Prepaid expenses || || EUR millions || 31.12.2013 || 31.12.2012 Financial Engineering Instruments || 2 118 || 1 358 Aid Schemes || 2 845 || 2 332 Total || 4 963 || 3 690 The variation of the amounts
disclosed under this heading is due mainly to the Member States' increased
contribution to Financial Engineering Instruments in the area of regional
development. 2.11. CASH
AND CASH EQUIVALENTS || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Unrestricted cash: || 2.11.1 || || Accounts with Treasuries and Central Banks || || 2 505 || 2 203 Current accounts || || 168 || 106 Imprest accounts || || 4 || 3 Transfers (cash in transit) || || (1) || (1) || || 2 676 || 2 311 || || || Cash belonging to financial instruments & term deposits || 2.11.2 || 1 434 || 1 845 || || || Restricted cash and cash equivalents || 2.11.3 || 4 165 || 5 122 || || || Total || || 8 275 || 9 278 2.11.1. Unrestricted
cash Unrestricted cash covers all the
funds which the Commission keeps in its accounts in each Member State and EFTA country (treasury or central bank), as well as in current accounts, imprest
accounts and petty cash. Unrestricted cash at
31 December 2013 includes EUR 1.1 billion of own resources contributions due by
Members States on 1 January 2014 which were received some days in advance.
Furthermore, the
year-end balance contains EUR 1.3 billion of competition fines, mostly cashed
by the Commission in the last weeks of 2013 which were not yet returned to
Member States via an Amending Budget. 2.11.2. Cash
belonging to financial instruments & term deposits Amounts shown under this heading
are mainly current deposits and other cash equivalents managed by fiduciaries
on behalf of the Commission for the purpose of implementing particular
financial instruments programmes funded by the EU budget. This cash can thus
only be used in the financial instruments programme concerned. 2.11.3. Restricted
cash and cash equivalents Restricted cash refers to amounts
received in connection with fines issued by the Commission for which the case
is still open. These are kept in specific deposit accounts that are not used
for any other activities. In case an appeal has been lodged or where it is
unknown if an appeal will be made by the other party, the underlying amount is
shown as contingent liability in note 5.2. The decrease in restricted cash
is due to the fact that since 2010, all provisionally cashed fines are managed
by the Commission in a specifically created fund (BUFI) and invested in
financial instruments categorised as available for sale (see notes 2.4.1
and 2.8.1). NON-CURRENT LIABILITIES 2.12. PENSION
AND OTHER EMPLOYEE BENEFITS || || EUR millions || 31.12.2013 || 31.12.2012 Pensions – staff || 40 933 || 37 528 Pensions – other || 301 || 85 Joint Sickness Insurance Scheme || 4 869 || 4 007 Total || 46 103 || 41 620 2.12.1. Pensions –
staff In accordance with Article 83 of
the Staff Regulations, the payment of the benefits provided for in the staff
pension scheme (PSEO: Pension Scheme of European Officials) constitutes a
charge to the EU's budget. The scheme is not funded, but the Member States
guarantee the payment of these benefits collectively according to the scale
fixed for the financing of this expense. In addition, officials contribute one
third to the long-term financing of this scheme via a compulsory contribution. The liabilities of the pension
scheme were assessed on the basis of the number of staff and retired staff at
31 December 2013 and on the rules of the Staff Regulations applicable at this
date. This valuation was carried out in accordance with the methodology of
IPSAS 25 (and therefore also EU accounting rule 12). The method used to
calculate this liability is the projected unit credit method. The main
actuarial assumptions available at the valuation date and used on the valuation
were as follows: Actuarial assumptions - staff pension liability || 31.12.2013 || 31.12.2012 Nominal discount rate || 3.7% || 3.6% Expected inflation rate || 1.9% || 2.0% Real discount rate || 1.8% || 1.6% Probability of marriage: man/woman || 81%/49% || 84%/38% General salary growth/pension revaluation || 0% || 0% International Civil Servants Life Table (ICSLT) || ICSLT 2013 || ICSLT 2008 || || EUR millions Movement in gross employee benefits liability || Staff pension liability || Sickness Insurance Gross liability at previous year-end || 41 961 || 4 278 Service/normal cost || 1 928 || - Interest cost || 1 603 || 162 Benefits paid || (1 288) || (11) Actuarial losses || 1 499 || 704 Change due to newcomers || 244 || - Gross liability at year-end || 45 947 || 5 133 Correction coefficients applied to pensions || 959 || N/A Deduction of taxes on pensions || (5 973) || N/A Plan assets || N/A || (264) Net liability at year-end || 40 933 || 4 869 2.12.2. Pensions –
other This liability refers to the
pension obligations towards Members and former Members of the Commission.
Additionally, the 2013 amount includes pension obligations towards MEPs as the
administration and payment of these have now been transferred from the European
Parliament to the Commission. 2.12.3. Joint
Sickness Insurance Scheme A valuation is also made for the
estimated liability that the EU has regarding its contributions to the Joint
Sickness Insurance Scheme in relation to its retired staff. The gross liability
has been valued at
EUR 5 133 million (2012: EUR 4 278 million) and plan assets of EUR 264 million
(2012: EUR 271 million) are deducted from the gross liability to arrive at the
net amount. The discount rate and the general salary growth used in the
calculation are the same as those used in the staff pension valuation. 2.13. NON-CURRENT
PROVISIONS || || || || || || || EUR millions || Amount at 31.12.2012 || Additional provisions || Unused amounts reversed || Amounts used || Transfer to current || Change in estimation || Amount at 31.12.2013 Legal cases || 130 || 180 || (51) || (3) || - || 0 || 257 Nuclear site dismantling || 997 || - || - || (2) || (30) || (32) || 933 Financial || 108 || 45 || - || - || (38) || (3) || 111 Other || 2 || 2 || (1) || 0 || - || - || 3 Total || 1 237 || 227 || (52) || (5) || (69) || (35) || 1 303 Legal cases This is the estimate of amounts
that will probably have to be paid out more than 12 months after the year-end
in relation to a number of on-going legal cases. The additional legal cases
provisions concern mostly new court cases in the area of agriculture and
cohesion. Nuclear site dismantlement In 2012 a
consortium of independent experts made an update of their 2008 study on the
estimated costs of the decommissioning of the Joint Research Centre (JRC)
nuclear facilities and waste management programme. Their
revised estimate of EUR 989 million (previously EUR 1
222 million) is taken as the basis for the provision to be included in
the accounts. In accordance with EU accounting rules this provision is indexed
for inflation and then discounted to its net present value (using the Euro
zero-coupon swap curve). In view of the estimated duration of this programme
(around 20 years), it should be pointed out that there is some uncertainty
about this estimate, and the final cost could be different from the amounts
currently entered. Financial provisions These concern mainly provisions
which represent the estimated losses that will be incurred in relation to the
guarantees given under the SME Guarantee Facility 1998, the SME Guarantee
Facility 2001 and the SME Guarantee Facility 2007 under the Competitiveness and
Innovation framework Programme (CIP) and the European Progress Microfinance Facility
(Guarantee), where the European Investment Fund (EIF) is empowered to issue
guarantees in its own name but on behalf of and at the risk of the Commission.
The financial risk linked to the drawn and undrawn guarantees is, however,
capped. Non-current financial provisions are discounted to their net present
value (using the Euro Swap annual rate). 2.14. NON-CURRENT
FINANCIAL LIABILITIES || || || EUR millions || || 31.12.2013 || 31.12.2012 Non-current borrowings || || 53 984 || 57 058 Elimination Guarantee Fund* || || (20) || (20) Total || || 53 964 || 57 038 * The Guarantee Fund holds
EFSM bonds issued by the Commission, so these need to be eliminated. Non-current borrowings || || || || || EUR millions || MFA || Euratom || BOP || EFSM || Total Total at 31.12.2012 || 549 || 425 || 11 623 || 44 476 || 57 073 New borrowings || 100 || - || - || - || 100 Repayments || (81) || (36) || - || - || (117) Exchange differences || - || (1) || - || - || (1) Changes in carrying amount || 1 || (1) || - || (8) || (8) Total at 31.12.2013 || 569 || 387 || 11 623 || 44 468 || 57 047 || || || || || Amount due < 1 year || 31 || - || 3 033 || - || 3 064 || || || || || Amount due > 1 year || 538 || 387 || 8 590 || 44 468 || 53 983 This heading
includes borrowings of the Commission maturing in over one year. The changes in
carrying amount correspond to the change in accrued interests. The effective
interest rates (expressed as a range of interest rates) were as follows: Borrowings || 31.12.2013 || 31.12.2012 Macro Financial Assistance (MFA) || 0.27%-4.54% || 0.298%-4.54% Euratom || 0.291%-5.6775% || 0.351%-5.6775% Balance of Payment (BOP) || 2.375%-3.625% || 2.375%-3.625% European Financial Stability Mechanism (EFSM) || 2.375%-3.750% || 2.375%-3.750% For more
information on borrowing and lending activities, see note 2.4 and note 7
of the EU consolidated annual accounts. 2.15. OTHER
NON-CURRENT LIABILITIES || || EUR millions || 31.12.2013 || 31.12.2012 Finance leasing debts || 1 084 || 1 124 Buildings paid for in instalments || 336 || 352 Other || 23 || 26 Total || 1 442 || 1 502 CURRENT LIABILITIES 2.16. CURRENT
PROVISIONS || || || || || || || EUR millions || Amount at 31.12.2012 || Additional provisions || Unused amounts reversed || Amounts used || Transfers from non- current || Change in estimation || Amount at 31.12.2013 Legal cases || 222 || 5 || (2) || (1) || - || 0 || 225 Nuclear site dismantlement || 29 || - || - || (29) || 30 || - || 30 Financial || 188 || 53 || (45) || (55) || 38 || (8) || 171 Other || 275 || 5 || (89) || (129) || - || - || 63 Total || 714 || 63 || (135) || (214) || 69 || (9) || 489 2.17. CURRENT
FINANCIAL LIABILITIES This heading relates to the
portion of non-current borrowings (see note 2.14) that mature during the
12 months following the balance sheet date. The increase compared to last year
is due to repayments of BOP loans scheduled for 2014 (Hungary EUR 2 billion and
Latvia EUR 1 billion). 2.18.
PAYABLES || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Accrued charges and deferred income || 2.18.1 || 55 881 || 68 076 Payables || 2.18.2 || 36 015 || 21 351 Current portion of non-current liabilities || || 60 || 57 Total || || 91 956 || 89 484 2.18.1. Accrued
charges and deferred income || || EUR millions || 31.12.2013 || 31.12.2012 Accrued charges || 55 725 || 67 914 Deferred income || 138 || 157 Other || 18 || 5 Total || 55 881 || 68 076 The split of accrued charges is
as follows: || || EUR millions || 31.12.2013 || 31.12.2012 European Agricultural Guarantee Fund || || Direct aid and interventions in agricultural markets || 33 489 || 44 532 Other || 2 || 1 Rural Development || || EAFRD || 12 255 || 12 463 Other || 203 || 34 || 45 949 || 57 030 Structural Actions: || || European Fisheries Fund / Financial Instruments for Fisheries Guidance || 48 || 66 European Regional Development Fund and Cohesion Fund || 4 356 || 4 359 Instrument for Structural Policies for pre-Accession || 114 || 382 European Social Fund || 1 100 || 1 378 || 5 618 || 6 185 Other accrued charges: || || Research & Development || 1 172 || 1 077 Other || 2 986 || 3 622 || 4 158 || 4 699 Total || 55 725 || 67 914 Details on the decrease of
accrued charges are provided in note 2.18.2 below. 2.18.2. Payables || || EUR millions || 31.12.2013 || 31.12.2012 Member States || 37 477 || 23 020 Suppliers and other || 1 455 || 1 506 Estimated non-eligible amounts and pending pre-payments || (2 918) || (3 175) Total || 36 015 || 21 351 Member States Payables to Member States relate
primarily to unpaid cost claims for structural actions (EUR 20.8 billion for
ERDF and CF and EUR 4.2 billion for ESF). Furthermore, the amount includes
EUR 11.3 billion for the European Agricultural Guarantee Fund (EAGF). In order
to better present the economic reality, from 2013 onwards, amounts related to
EAGF for which payment was due on the first working day of January of the
following year are recorded as amounts payable instead of accrued charges. Had
the current approach been followed in the 2012 accounts, the amount of Member
States payables would have been EUR 11.9 billion higher (i.e. EUR 34.9
billion). The remaining EUR 1.2 billion Member State payables mainly concern fisheries and maritime policies (EUR 0.6 billion) and
rural development (EUR 0.2 billion). Suppliers and other Included under this heading are
sundry payables, amounts owed following grant and procurement activities, as
well as amounts payable to public bodies and non-consolidated entities. Estimated non-eligible amounts and pending
prepayments Payables are reduced by that part
of the requests for reimbursement received, but not yet checked, that was
estimated to be ineligible. The largest amounts concern the Structural Actions
DGs. Payables are also reduced by the part of requests for reimbursement
received corresponding to prepaid expenditure still to pay at year end (EUR 2.2
billion). 2.18.3. Current
portion of non-current liabilities || || EUR millions || 31.12.2013 || 31.12.2012 Finance leasing debts || 44 || 42 Other || 16 || 15 Total || 60 || 57 NET ASSETS 2.19. RESERVES || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Fair value reserve || 2.19.1 || 83 || 96 Guarantee Fund reserve || 2.19.2 || 2 125 || 2 079 Other reserves || || 90 || 79 Total || || 2 299 || 2 254 2.19.1.
Fair value reserve In accordance with the accounting
rules, the adjustment to fair value of available for sale financial assets is
accounted for through the fair value reserve. 2.19.2. Guarantee
Fund reserve This reserve reflects the 9%
target of the outstanding amounts guaranteed by the Fund that is required to be
kept as assets. 2.20. AMOUNTS
TO BE CALLED FROM MEMBER STATES || EUR millions || Amounts to be called from Member States at 31.12.2012 || 47 150 Return of 2012 budget surplus to Member States || 1 023 Movement in Guarantee Fund reserve || 46 Other reserve movements || 9 Economic result of the year || 4 685 Total amounts to be called from Members States at 31.12.2013 || 52 913 || Split between: || Employee benefits || 46 103 Other amounts || 6 810 The inclusion in the accounts of
liabilities due for payment in future years and financed by future budgets
results in total liabilities greatly exceeding total assets at the year-end. 3.
NOTES TO THE STATEMENT OF FINANCIAL PERFORMANCE 3.1. OWN
RESOURCE AND CONTRIBUTIONS REVENUE || || || EUR millions || Note || 2013 || 2012 GNI resources || || 110 194 || 98 061 Traditional own resources: Customs duties || || 15 268 || 16 087 Sugar levies || || 199 || 157 VAT resources || || 14 019 || 14 871 Own resource revenue || 3.1.1 || 139 680 || 129 176 Budgetary adjustments || 3.1.2 || (1 888) || (1 402) Contributions of third countries (incl. EFTA) || || 364 || 302 Total || || 138 156 || 128 076 3.1.1. Own resource revenue Own resource revenue is the primary
element of the EU’s operating revenue. Thus the bulk of expenditure is financed
by own resources as other revenue represents only a minor part of the total
financing. There are three categories of own resources: traditional own
resources (“TOR”), the VAT-based resource and the GNI-based resource.
Traditional own resources comprise sugar levies and customs duties. A
correction mechanism in respect of budgetary imbalances (UK Rebate) as well as
a gross reduction in the annual GNI-based contribution of Netherlands and Sweden are also part of the own resources system. Member States retain, by way of
collection costs, 25% of traditional own resources, and the above amounts are
shown net of this deduction. It should be noted that a refund of
EUR 169 million (gross, EUR 126 million net) claimed by Belgium in 2011 under Traditional Own Resources was paid out in 2013 after the completion
of audits and controls on the reliability of the Belgian clearance and
accounting systems. The related provision booked in 2012 was used in 2013. It should also be noted that
following a Court ruling on the sugar levies regulation challenged by certain
companies and Member States, and the subsequent adoption by the Council of a
new regulation end of December 2013, an amount of EUR 214 million will have to
be reimbursed to the concerned parties end of 2014. A provision booked in 2012
and covering this amount is still included in the accounts. 3.1.2. Budgetary adjustments The budgetary adjustments include
the budget surplus from 2012 (EUR 1 023 million) which is indirectly refunded
to Member States by deduction of the amounts of own resources they have to
transfer to the EU in the following year – thus it is a revenue for 2013. 3.2. OTHER
OPERATING REVENUE || || || EUR millions || || 2013 || 2012 Fines || || 2 757 || 1 884 || || || Agricultural levies || || 48 || 87 || || || Recovery of expenses: || || || Direct centralised management || || 58 || 62 Indirect centralised management || || 6 || 30 Decentralised management || || 41 || 27 Joint management || || 33 || 8 Shared management || || 1 628 || 1 376 Total || || 1 766 || 1 503 Revenue from administrative operations: || || || Staff || || 878 || 890 Property, plant and equipment related revenue || || 13 || 18 Other administrative revenue || || 185 || 164 Total || || 1 075 || 1 072 Miscellaneous operating revenue: || || || Adjustments/provisions || || 174 || 274 Exchange gains || || 325 || 328 Other || || 1 339 || 935 Total || || 1 838 || 1 537 Total || || 7 484 || 6 083 The increase in
other operating revenue is mainly explained by a higher amount of revenue
relating to fines in 2013. These revenues relate to fines imposed by the
Commission for infringement of competition rules. Receivables and related
revenues are recognised when the Commission decision imposing a fine has been
taken and it is officially notified to the addressee. The higher amount in 2013 is mainly
explained by fines of EUR 1.7 billion which were imposed on a number of banks
for participating in cartels in the interest rate derivatives industry.
Furthermore, in 2013 there is a high value fine case concerning Microsoft (EUR
561 million) and its failure to promote a range of web browsers, rather than
just Internet Explorer, to users in the EU. 3.3. ADMINISTRATIVE
EXPENSES || || EUR millions || 2013 || 2012 Staff expenses || 3 080 || 3 197 Other administrative expenses || 1 869 || 1 869 Depreciation and impairment || 158 || 155 Total || 5 107 || 5 221 Included
under other administrative expenses are EUR 148 million (2012: EUR 151 million)
expenses relating to operating leases. The amounts committed to be paid during
the remaining term of these lease contracts are as follows: || || EUR millions Description || Future amounts to be paid || || < 1 year || 1- 5 years || > 5 years || Total Buildings || 130 || 444 || 439 || 1 013 IT materials and other equipment || 3 || 5 || 0 || 8 Total || 133 || 449 || 439 || 1 021 3.4. OPERATING
EXPENSES || || || EUR millions || Note || 2013 || 2012 Primary operating expenses: || 3.4.1 || || Direct centralised management || || 9 635 || 10 728 Indirect centralised management || || 5 559 || 4 218 Decentralised management || || 720 || 1 019 Shared management || || 120 070 || 106 378 Joint management || || 1 745 || 1 819 Total || || 137 728 || 124 162 Other operating expenses: || 3.4.2 || || Adjustments/provisions || || 302 || 425 Exchange losses || || 363 || 265 Other || || 493 || 156 Total || || 1 158 || 846 Total || || 138 886 || 125 008 3.4.1. Primary operating expenses Operating expenses cover the
various headings of the financial framework and take different forms, depending
on how the money is paid out and managed. Most expenses fall under the heading
“Shared Management” involving the delegation of tasks to Member States,
covering such areas as EAGF spending and actions financed through the different
Structural Actions (the regional development fund, the social fund, the
agricultural fund for rural development, the cohesion fund and the fisheries
fund). The main elements of the operating
expenses above cover the following areas: agriculture and rural development EUR
59 billion (2012: EUR 57 billion), regional development and cohesion EUR 49
billion (2012: EUR 39 billion), employment and social affairs EUR 12 billion
(2012: EUR 11 billion), research and communication networks, content and
technology EUR 6 billion (2012: EUR 6 billion) and external relations EUR 3
billion (2012: EUR 3 billion). The overall increase in operating
expenses is driven by the advancement of the projects in the area of regional
development for the programming period 2007-2013. 3.4.2. Other operating expenses Exchange losses, except on
financial activities dealt with in note 3.6 below, occur on the everyday
activities and related transactions made in currencies other than the Euro, as
well as the year-end revaluation required to prepare the accounts – they are
both realised and unrealised. The 2013 heading other (under
other operating expenses) mainly comprised the correction of fines issued in
previous years totalling EUR 360 million. Research and
Development costs Included under administrative and
operating expenses are expenses relating to research and development as
follows: || || EUR millions Research and Development costs || 2013 || 2012 Research costs || 329 || 322 Non-capitalised development costs || 50 || 58 Total || 379 || 380 3.5. FINANCIAL
REVENUE || || EUR millions || 2013 || 2012 Dividend income || 6 || 12 || || Interest income: || || On pre-financing || 29 || 28 On late payments || 88 || 242 On available for sale financial assets || 45 || 58 On loans || 1 698 || 1 543 On cash and cash equivalents || 18 || 20 Total || 1 878 || 1 891 Other financial income: || || Realised gain on sale of financial assets || 3 || 12 Other || 84 || 160 Total || 87 || 172 || || Exchange gains || 2 || 9 || || Total || 1 971 || 2 084 3.6. FINANCIAL EXPENSES || || EUR millions || 2013 || 2012 Interest expenses: || || Leasing || 64 || 65 On borrowings || 1 682 || 1 528 Other || 21 || 21 Total || 1 766 || 1 614 Other financial expenses: || || Adjustments to financial provisions || 98 || 75 Expenses relating to financial instruments managed by fiduciaries || 68 || 43 Impairment losses on available for sale financial assets || 7 || 7 Realised loss on sale of financial assets || 0 || 4 Other || 33 || 140 Total || 205 || 269 Exchange losses || 18 || 14 || || Total || 1 990 || 1 897 3.7. SHARE
OF NET DEFICIT OF JOINT VENTURES AND ASSOCIATES In accordance with the equity
method of accounting, the Commission includes in its statement of financial
performance its share of the net deficit of its joint ventures and associates
(see also notes 2.3.1 and 2.3.2). 3.8. REVENUE
FROM NON-EXCHANGE TRANSACTIONS In 2013, EUR 145 370 million
revenue from non-exchange transactions has been recognised in the statement of
financial performance (2012: EUR 133 882 million). 3.9. SEGMENT
REPORTING || || || || EUR millions || Activities within the EU || Activities outside the EU || Services and Other || Total Fines || 2 757 || - || - || 2 757 Agricultural levies || 48 || - || - || 48 Recovery of expenses || 1 686 || 79 || 0 || 1 766 Revenue from administrative operations || 77 || 1 || 998 || 1 075 Miscellaneous operating revenue || 1 252 || 104 || 482 || 1 838 OTHER OPERATING REVENUE || 5 819 || 184 || 1 481 || 7 484 Staff expenses || (1 501) || (321) || (1 258) || (3 080) Intangible assets and PPE related expenses || (44) || - || (114) || (158) Other administrative expenses || (660) || (329) || (880) || (1 869) Administrative expenses || (2 205) || (649) || (2 253) || (5 107) Direct centralised management || (6 037) || (3 348) || (250) || (9 635) Indirect centralised management || (4 943) || (585) || (32) || (5 559) Decentralised management || (181) || (539) || - || (720) Shared management || (119 995) || (74) || - || (120 070) Joint management || (233) || (1 512) || 0 || (1 745) Other operating expenses || (784) || (6) || (368) || (1 158) Operating expenses: || (132 173) || (6 064) || (650) || (138 886) TOTAL OPERATING EXPENSES || (134 378) || (6 713) || (2 903) || (143 993) Net operating expenses || (128 558) || (6 529) || (1 422) || (136 509) Own resource and contributions revenue || || || || 138 156 Surplus from operating activities || || || || 1 647 Net financial revenue || || || || (17) Movement in pension and other employee benefits liability || || || || (5 707) Share of associates/joint ventures deficit || || || || (608) Economic result of the year || || || || (4 685) 4.
NOTES TO THE CASHFLOW STATEMENT 4.1. PURPOSE
AND PREPARATION OF THE CASHFLOW STATEMENT Cashflow information is used to
provide a basis for assessing the ability of the EU to generate cash and cash
equivalents, and its needs to utilise those cashflows. The cashflow statement is
prepared using the indirect method. This means that the net surplus or deficit
for the financial year is adjusted for the effects of transactions of a
non-cash nature, any deferrals or accruals of past or future operating cash
receipts or payments, and items of revenue or expense associated with investing
cashflows. Cashflows arising from
transactions in a foreign currency are recorded in the EU’s reporting currency
(Euro), by applying to the foreign currency amount the exchange rate between
the euro and the foreign currency at the date of the cashflow. The cashflow statement presented
reports cashflows during the period classified by operating and investing
activities (the EU does not have financing activities). 4.2. OPERATING
ACTIVITIES Operating activities are the
activities of the EU that are not investing activities. These are the majority
of the activities performed. Loans granted to beneficiaries (and the related
borrowings, when applicable) are not considered as investing (or financing)
activities as they are part of the general objectives and thus daily operations
of the EU. Operating activities also include investments such as EIF, EBRD and
venture capital funds. Indeed, the objective of these activities is to
participate in the achievement of policy targeted outcomes. 4.3. INVESTING
ACTIVITIES Investing activities are the
acquisition and disposal of intangible assets and property, plant and equipment
and of other investments which are not included in cash equivalents. Investing
activities do not include loans granted to beneficiaries. The objective is to
show the real investments made by the EU. 5.
CONTINGENT ASSETS & LIABILITIES AND OTHER
SIGNIFICANT DISCLOSURES 5.1. CONTINGENT
ASSETS || || EUR millions || 31.12.2013 || 31.12.2012 Guarantees received: || || Performance guarantees || 226 || 232 Other guarantees || 3 || 2 Other contingent assets || 13 || 12 Total || 243 || 246 Performance
guarantees are requested to ensure that beneficiaries of EU funding meet the
obligations of their contracts with the EU. 5.2. CONTINGENT
LIABILITIES || || || EUR millions || Note || 31.12.2013 || 31.12.2012 Guarantees given || 5.2.1 || 22 162 || 22 317 Fines || 5.2.2 || 5 227 || 6 378 EAGF, rural development and pre-accession || 5.2.3 || 1 537 || 1 188 Cohesion policy || 5.2.4 || 137 || 546 Legal cases and other disputes || 5.2.5 || 685 || 78 Total || || 29 749 || 30 508 All contingent
liabilities, except those relating to fines, would be financed, should they
fall due, by the EU budget in the years to come. 5.2.1.
Guarantees given || || EUR millions || 31.12.2013 || 31.12.2012 On loans granted by the EIB from its own resources: || || 65% guarantee || 19 077 || 18 683 70% guarantee || 1 361 || 1 654 75% guarantee || 257 || 383 100% guarantee || 461 || 594 Total || 21 156 || 21 314 Other guarantees given || 1 006 || 1 003 || || Total || 22 162 || 22 317 The EU budget guarantees loans
signed and granted by the EIB from its own resources to third countries at 31
December 2013 (including loans granted to Member States before accession).
However, the EU’s guarantee is limited to a percentage of the ceiling of the
credit lines authorised: 65% (for the mandate 2000-2007), 70%, 75% or 100%. For
the mandate 2007-2013, the EU’s guarantee is limited to 65% of the outstanding
balances and not on the credit lines authorised. Where the ceiling is not
reached, the EU guarantee covers the full amount. At 31 December 2013 the
amount outstanding totalled
EUR 21 156 million and this, therefore, is the maximum exposure faced by the
EU. Other
guarantees given relate mainly to the Risk-Sharing Finance Facility (EUR 958
million). 5.2.2. Fines These amounts concern fines
imposed by the Commission for infringement of competition rules that have been
provisionally paid and where either an appeal has been lodged or where it is
unknown if an appeal will be made. The contingent liability will be maintained
until a decision by the Court of Justice on the case is final. Interest earned
on provisional payments is included in the economic result of the year and also
as a contingent liability to reflect the uncertainty of the Commission’s title
to these amounts. 5.2.3.
EAGF, rural development and pre-accession These are contingent liabilities
towards the Member States connected with the EAGF conformity decisions, rural
development and pre-accession financial corrections pending judgement of the
Court of Justice. The determination of the final amount of the liability and
the year in which the effect of successful appeals will be charged to the
budget will depend on the length of the procedure before the Court. 5.2.4.
Cohesion policy These are contingent liabilities
towards the Member States in conjunction with actions under cohesion policy
awaiting the oral hearing date or pending judgement of the Court of Justice. 5.2.5.
Legal cases and other disputes This heading relates to actions
for damages currently being brought against the EU, other legal disputes and
the estimated legal costs. It should be noted that in an action for damages
under Article 288 EC the applicant must demonstrate a sufficiently serious
breach by the institution of a rule of law intended to confer rights on
individuals, real harm suffered by the applicant, and a direct causal link
between the unlawful act and the harm. 5.3. OTHER
SIGNIFICANT DISCLOSURES 5.3.1.
Outstanding commitments not yet expensed || || EUR millions || 31.12.2013 || 31.12.2012 Outstanding commitments not yet expensed || 175 828 || 174 070 The amount
disclosed above is the budgetary RAL ("Reste à Liquider") less
related amounts that have been included as expenses in the 2013 statement of
financial performance. The budgetary RAL is an amount representing the open
commitments for which payments and/or de-commitments have not yet been made.
This is the normal consequence of the existence of multi-annual programmes. At 31 December
2013 the budgetary RAL totalled EUR 221 853 million (2012: EUR 217 222
million). 5.3.2.
Significant legal commitments || || EUR millions || 31.12.2013 || 31.12.2012 Structural Actions || 150 || 71 775 Protocol with Mediterranean countries || 264 || 264 Fisheries agreements || 79 || 173 Galileo || 0 || 143 Global Monitoring for Environment and Security (GMES) || 0 || 233 Trans-European Transport Networks (TEN-T) || 850 || 1 331 Other contractual commitments || 522 || 538 Total || 1 864 || 74 457 These
commitments originated because the Commission entered into long-term legal
commitments in respect of amounts that were not yet covered by commitment
appropriations in the budget. This can relate to multi-annual programmes such
as Structural Actions or amounts that the Commission is committed to pay in the
future under administrative contracts existing at the balance sheet date (e.g.
relating to the provision of services such as security, cleaning, etc, but also
contractual commitments concerning specific projects such as building works). Structural Actions The table below shows a
comparison between the legal commitments for which budget commitments have not
yet been made and the maximum commitments in relation to the amounts foreseen
in the financial framework 2007-2013. The future obligations represent
the outstanding amounts for which the Commission is still committed to make
payments after 31 December 2013. The EUR 150 million remaining outstanding
amount corresponds to the Amending Budget 7/2013 for structural funds. || || || || || || || EUR millions || Financial framework 2007-2013 (A) || Legal commitments concluded (B) || Budget commitments (C ) || Decommit- ments (D) || Legal commitments less budget commitments (=B-C+D) || Maximum commitment (=A-C+D) || Future obligations (=A-C) Structural funds || 348 151 || 347 767 || 348 001 || 264 || 30 || 414 || 150 Natural Resources || 100 558 || 100 353 || 100 558 || 205 || 0 || 205 || 0 Instrument for Pre-Accession Assistance || 11 110 || 10 856 || 11 110 || 259 || 6 || 259 || 0 Total || 459 818 || 458 976 || 459 668 || 728 || 36 || 878 || 150 Protocols with Mediterranean countries These commitments relate to
financial protocols with Mediterranean non-member countries. The amount included
here is the difference between the total amount of the protocols signed and the
amount of the budget commitments entered in the accounts. These protocols are
international treaties that cannot be wound up without the agreement of both
parties, although the winding-up process is on-going. Fisheries agreements These are commitments entered
into with third countries for operations under international fisheries
agreements. Galileo These are amounts committed to
the Galileo programme developing a European Global Navigation Satellite System
– see also note 2.2. GMES The Commission has entered into a
contract with the ESA for the period from 2008 to 2013 for the implementation
of the space component of Global Monitoring for Environment and Security
(GMES). The total indicative amount for that period is EUR 728 million. TEN-T This amount relates to grants in
the field of the Trans-European Transport Networks (TEN-T) for the period 2007-2013.
The programme applies to projects identified to support both infrastructure
projects and research and innovation projects to foster the integration of new
technologies and innovative processes on the deployment of new transport
infrastructure. The total indicative amount for this programme is EUR 7.9
billion. The decrease in legal commitments
relating to TEN-T is the combined effect of reduced legal commitments following
amendment decisions and increased budget commitments. 6.
RELATED PARTIES The related parties of the EU are
the EU consolidated entities and the key management personnel of these
entities. Transactions between these entities take place as part of the normal
operations of the EU and as this is the case, no specific disclosure
requirements are necessary for these transactions in accordance with the EU
accounting rules. Details on key
management entitlements are provided in note 9 of the EU consolidated annual
accounts. 7.
EVENTS AFTER THE BALANCE SHEET DATE At the date of transmission of
these annual accounts, no material issues had come to the attention of the
Accounting Officer of the Commission or were reported to him that would require
separate disclosure under this section. The annual accounts and related notes
were prepared using the most recently available information and this is
reflected in the information presented. EUROPEAN
COMMISSION FINANCIAL
YEAR 2013 REPORTS
ON THE IMPLEMENTATION OF THE BUDGET AND EXPLANATORY NOTES* * It should be noted
that due to the rounding of figures into millions of euros, some financial data
in the tables below may appear not to add-up. CONTENTS REPORTS ON THE IMPLEMENTATION OF THE BUDGET AND
EXPLANATORY NOTES BUDGETARY STRUCTURE AND PRINCIPLES. 55 1. RESULT OF IMPLEMENTATION OF THE EU BUDGET. 59 1.1 EU BUDGET RESULT. 59 1.2 RECONCILIATION OF ECONOMIC RESULT WITH BUDGET RESULT. 59 1.3 STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS. 61 2. IMPLEMENTATION OF EU BUDGET REVENUE. 66 2.1 SUMMARY OF THE IMPLEMENTATION OF BUDGET REVENUE. 66 3. IMPLEMENTATION OF EU BUDGET EXPENDITURE. 70 3.1 BREAKDOWN &
CHANGES IN COMMITMENT & PAYMENT APPROPRIATIONS BY FINANCIAL
FRAMEWORK HEADING. 70 3.2 IMPLEMENTATION OF
COMMITMENT APPROPRIATIONS BY FINANCIAL FRAMEWORK HEADING. 71 3.3 IMPLEMENTATION OF
PAYMENT APPROPRIATIONS BY FINANCIAL FRAMEWORK HEADING. 71 3.4 MOVEMENTS IN COMMITMENTS
OUTSTANDING - BY FINANCIAL FRAMEWORK HEADING. 72 3.5 BREAKDOWN OF COMMITMENTS OUTSTANDING BY YEAR OF ORIGIN - BY FINANCIAL
FRAMEWORK HEADING. 72 3.6 BREAKDOWN AND
CHANGES IN COMMITMENT AND PAYMENT APPROPRIATIONS BY
POLICY AREA. 73 3.7 IMPLEMENTATION OF COMMITMENT APPROPRIATIONS BY POLICY AREA. 74 3.8 IMPLEMENTATION OF PAYMENT APPROPRIATIONS BY POLICY AREA. 75 3.9 MOVEMENTS IN COMMITMENTS OUTSTANDING BY POLICY AREA. 76 3.10 BREAKDOWN OF
COMMITMENTS OUTSTANDING BY YEAR OF ORIGIN BY POLICY AREA. 77 BUDGETARY
STRUCTURE AND PRINCIPLES The budgetary accounts are kept in
accordance with Regulation (EU, Euratom) No 966/2012 of the European Parliament
and of the Council of 25 October 2012 (OJ L 298 of 26 October 2012), on the
financial rules applicable to the general budget of the Union (hereinafter
referred to as the 'Financial Regulation') and Commission Delegated Regulation
(EU) No 1268/2012 of 29 October 2012 laying down detailed rules of application
of this Financial Regulation. The general budget, the main instrument of the
Union's financial policy, is the instrument which provides for and authorises
the Union's revenue and expenditure every year. Every year, the Commission
estimates all the Institutions' revenue and expenditure for the year and draws
up a draft budget which it sends to the budgetary authority. On the basis of
this draft budget, the Council draws its position which is then the subject of
negotiations between the two arms of the budgetary authority. The President of
Parliament declares that the joint draft has been finally adopted, thus making
the budget enforceable. The task of executing the budget is mainly the
responsibility of the Commission. The budget
structure for the Commission consists of administrative and operational
appropriations. The other Institutions have only administrative appropriations.
Furthermore, the budget distinguishes between two types of appropriations:
non-differentiated and differentiated. Non-differentiated appropriations are
used to finance operations of an annual nature (which comply with the principle
of annuality). Differentiated appropriations were introduced in order to
reconcile the principle of annuality with the need to manage multi-annual
operations. They are intended to cover mainly multi-annual operations.
Differentiated appropriations are split into commitment and payment
appropriations: –
commitment
appropriations: cover the total cost of the
legal obligations entered into for the current financial year for operations
extending over a number of years. However, budgetary commitments for actions
extending over more than one financial year may be broken down over several
years into annual instalments where the basic act so provides. –
payment appropriations: cover expenditure arising from commitments entered into in the
current financial year and/or earlier financial years. Origin of
Appropriations The main source of appropriations
is the Union's budget for the current year. However, there are other types of
appropriations resulting from the provisions of the Financial Regulation. They
come from previous financial years or outside sources: –
Initial budget
appropriations adopted for the current year can
be supplemented with transfers between lines and by amending budgets. –
Appropriations carried
over from previous year or made available again
also supplement the current budget. These are: (i) non-differentiated payment appropriations which may be carried over
automatically for one financial year only; (ii) appropriations carried over by decision of the Institutions in one
of two cases: if the preparatory stages have been completed or if the legal
base is adopted late; and (iii) appropriations
made available again as a result of decommitments: This involves the re-entry
of commitment appropriations concerning structural funds which have been
decommitted. Amounts can be re-entered by way of exception in the event of
error by the Commission or if they are indispensable for completion of the
programme. –
Assigned revenue which is made up of: (i) refunds where the amounts are assigned revenue on the budget line
which incurred the initial expenditure and may be carried over without limit; (ii) EFTA appropriations: The agreement on the European Economic Area
(EEA) provides for financial contribution by its members to certain activities
in the EU budget. The budget lines concerned and the amounts projected are
published in Annex III of the EU budget. These budget lines are increased by
the EFTA contribution. Appropriations not used at the year-end are cancelled
and returned to the EEA countries; (iii) Revenue
from third parties/ other countries that have concluded agreements with the EU
involving a financial contribution to EU activities. The amounts received are
considered to be revenue from third parties which is allocated to the budget
lines concerned (often in the field of research) and may be carried over
without limit; (iv) Work
for third parties: As part of their research activities, the EU research
centres may work for outside bodies. As with the revenue from third parties,
the work for third parties is assigned to specific budget lines and may be
carried over without limit; and (v) Appropriations made available again as a result of repayment of
payments on account: These are EU funds which have been repaid by beneficiaries
and may be carried over without limit. Composition of Appropriations
Available – Initial budget = appropriations voted in year N-1; – Final budget appropriations = initial budget appropriations adopted
+ amending budget appropriations + transfers + additional appropriations; –
Additional appropriations = assigned revenue
(see above) + appropriations carried over from the previous financial year or
made available again following decommitments. Calculation of the Budget
Result The amounts of own resources
entered in the accounts are those credited in the course of the year to the
accounts opened in the Commission's name by the governments of the Member
States. Revenue comprises also, in the case of a surplus, the budget result for
the previous financial year. The other revenue entered in the accounts is the
amount actually received during the course of the year. For the purposes of calculating the
budget result for the year, expenditure comprises payments made against the
year's appropriations plus any of the appropriations for that year that are
carried over to the following year. Payments made against the year's
appropriations means payments that are made by the accounting officer by 31
December of the financial year. For the EAGF, payments are those effected by
the Member States between 16 October N-1 and 15 October N, provided that the accounting
officer was notified of the commitment and authorisation by 31 January N+1.
EAGF expenditure may be subject to a conformity decision following controls in
the Member States. The budget result comprises two
elements: the result of the EU and the result of the participation of the EFTA
countries belonging to the EEA. In accordance with Article 15 of Regulation No
1150/2000 on own resources, this result represents the difference between: – total revenue received for that year; and –
total payments made against that year's
appropriations plus the total amount of that year's appropriations carried over
to the following year. – The following are added to or deducted from the resulting figure: ·
the net balance of cancellations of payment
appropriations carried over from previous years and any payments which, because
of fluctuations in the euro rate, exceed non-differentiated appropriations
carried over from the previous year; and ·
the balance of exchange-rate gains and losses
recorded during the year. Appropriations carried over from
the previous financial year in respect of contributions by and work for third
parties, which by definition never lapse, are included with the additional
appropriations for the financial year. This explains the difference between
carryovers from the previous year in the 2013 budget implementation statements
and those carried over to the following year in the 2012 budget implementation
statements. Payment appropriations for re-use and appropriations made available
again following the repayment of payments on account are disregarded when
calculating the budget result. Payment appropriations carried over
include: automatic carryovers and carryovers by decision. The cancellation of
unused payment appropriations carried over from the previous year shows the
cancellations on appropriations carried over automatically and by decision. It
also includes the decrease in assigned revenue appropriations carried over to
the next year in comparison with 2012. 1.
RESULT OF IMPLEMENTATION OF THE EU BUDGET 1.1
EU BUDGET RESULT || || EUR millions || 2013 || 2012 Revenue for the financial year || 149 504 || 139 541 Payments against current year appropriations || (147 567) || (137 738) Payment appropriations carried over to year N+1 || (1 329) || (936) Cancellation of unused payment appropriations carried over from year N-1 || 437 || 92 Exchange differences for the year || (42) || 60 Budget result* || 1 002 || 1 019 * Of which EFTA result is EUR
(4) million in 2013 and EUR (4) million in 2012. The
budget result of the EU is returned to the Member States during the following
year through deduction of their amounts due for that financial year. 1.2
RECONCILIATION OF ECONOMIC RESULT WITH BUDGET
RESULT || || EUR millions || 2013 || 2012 ECONOMIC RESULT OF THE YEAR || (4 685) || (5 008) || || Revenue || || Entitlements established in current year but not yet collected || (2 062) || (1 986) Entitlements established in previous years and collected in current year || 3 343 || 4 567 Accrued revenue (net) || (134) || (38) Expenses || || Accrued expenses (net) || 3 217 || (1 590) Amount from liaison account || 3 075 || 2 842 Expenses prior year paid in current year || (1 123) || (2 695) Net-effect pre-financing || (823) || 844 Payment appropriations carried over to next year || (908) || (4 028) Payments made from carry-overs & cancellation of unused payment appropriations || 899 || 4 203 Movement in provisions || 4 323 || 7 591 Other || (1 069) || (701) || || BUDGET RESULT OF THE YEAR (COMMISSION) || 4 053 || 4 001 || || BUDGET RESULT OTHER INSTITUTIONS || (3 051) || (2 981) || || BUDGET RESULT OF THE YEAR (EU) || 1 002 || 1 019 The economic
result of the year is calculated on the basis of accrual accounting principles.
The budget result is however based on modified cash accounting rules, in
accordance with the Financial Regulation. As the economic result and the budget
result both cover the same underlying operational transactions, it is a useful
control to ensure that they are reconcilable. In 2013, prepaid expenses relating
to financial engineering instruments and aid schemes (see 2.6.2 and 2.10.2)
have been included in the 'net-effect pre-financing ' category for the first
time. The same reclassification has been made to the comparative figures above.
Reconciling items - Revenue The actual budgetary revenue for a
financial year corresponds to the revenue collected from entitlements
established in the course of the year and amounts collected from entitlements
established in previous years. Therefore the entitlements
established in the current year but not yet collected are to be deducted
from the economic result for reconciliation purposes as they do not form part
of budgetary revenue. On the contrary the entitlements
established in previous years and collected in current year must be
added to the economic result for reconciliation purposes. The net
accrued revenue mainly consists of accrued revenue for agricultural
levies, own resources and interests and dividends. Only the net-effect, i.e.
accrued revenue for current year minus reversal accrued revenue from previous
year, is taken into consideration. Reconciling items - Expenditure
The net
accrued expenses mainly consist of accruals made for year-end cut-off
purposes, i.e. eligible expenses incurred by beneficiaries of EU funds but not
yet reported to the Commission. While accrued expenses are not considered as
budgetary expenditure, payments made in the current
year relating to invoices registered in prior years are part of current
year's budgetary expenditure. The net
effect of pre-financing is the combination of (1) the new pre-financing
amounts paid in the current year and recognised as budgetary expenditure of the
year and (2) the clearing of the pre-financing paid in current year or previous
years through the acceptance of eligible costs. The latter represent an expense
in accrual terms but not in the budgetary accounts since the payment of the initial
pre-financing had already been considered as a budgetary expenditure at the
time of its payment. Besides the payments made against
the year's appropriations, the appropriations for that year that are carried to the next year also need to be taken into
account in calculating the budget result for the year (in accordance with
Article 15 of Regulation No 1150/2000). The same applies for the budgetary
payments made in the current year from carry-overs and
the cancellation of unused payment appropriations. The movement
in provisions relates to year-end estimates made in the accrual accounts
(employee benefits mainly) that do not impact the budgetary accounts. Other reconciling amounts comprise different elements
such as asset depreciation, asset acquisitions, capital lease payments and
financial participations for which the budgetary and accrual accounting
treatments differ. 1.3
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL
AMOUNTS 1.3.1.
REVENUE || || || || EUR millions || || Initial Budget || Final Budget || Actual Revenue 1. || Own resources || 131 288 || 140 326 || 140 100 || Of which Customs duties || 18 632 || 14 857 || 15 164 || Of which VAT || 15 030 || 14 680 || 14 542 || Of which GNI || 97 503 || 110 823 || 110 032 3. || Surpluses, balances and adjustments || 0 || 1 057 || 698 4. || Revenue accruing from persons working with the institutions and with other Union bodies || 957 || 957 || 905 5. || Revenue accruing from the administrative operation of the institutions || 52 || 52 || 279 6. || Contributions and refunds in connection with Union agreements and programmes || 60 || 60 || 3 888 7. || Interests on late payments and fines || 123 || 1 642 || 2 973 8. || Borrowing and lending operations || 4 || 4 || 2 9. || Miscellaneous revenue || 30 || 30 || 22 Total || || 132 514 || 144 128 || 148 866 1.3.2.
EXPENDITURE BY FINANCIAL FRAMEWORK HEADING || || || || EUR millions || || Initial Budget || Final Budget* || Payments made 1. || Sustainable growth || 59 085 || 73 528 || 71 238 || 1.1 Competetiveness for Growth & Employment || 11 886 || 16 290 || 14 307 || 1.2 Cohesion for Growth & Employment || 47 199 || 57 238 || 56 931 2 || Preservation & management of natural resources || 57 484 || 60 404 || 59 524 3 || Citizenship, freedom, security and justice || 1 515 || 2 197 || 1 883 4 || The EU as a global player || 6 323 || 7 200 || 7 055 5 || Administration || 4 903 || 5 559 || 4 990 6 || Compensations || 0 || 75 || 75 Total || || 129 310 || 148 964 || 144 766 * Including amending budgets,
appropriations carried over and assigned revenue. 1.3.3.
EXPENDITURE BY POLICY AREA || || || || EUR millions || || Initial Budget || Final Budget* || Payments made 01 || Economic and financial affairs || 428 || 411 || 397 02 || Enterprise || 1 162 || 1 587 || 1 456 03 || Competition || 92 || 107 || 93 04 || Employment and social affairs || 10 429 || 14 286 || 14 107 05 || Agriculture and rural development || 56 344 || 59 234 || 58 339 06 || Mobility and transport || 984 || 1 120 || 1 059 07 || Environment and Climate action || 391 || 438 || 406 08 || Research || 4 808 || 6 556 || 5 771 09 || Communications networks, content and technology || 1 389 || 2 024 || 1 826 10 || Direct research || 411 || 959 || 496 11 || Maritime affairs and Fisheries || 794 || 831 || 820 12 || Internal market || 103 || 127 || 116 13 || Regional policy || 37 434 || 43 960 || 43 494 14 || Taxation and customs union || 112 || 140 || 129 15 || Education and culture || 2 373 || 3 301 || 3 052 16 || Communication || 253 || 273 || 252 17 || Health and consumer protection || 593 || 622 || 599 18 || Home affairs || 799 || 1 053 || 1 035 19 || External relations || 3 089 || 3 354 || 3 295 20 || Trade || 102 || 112 || 104 21 || Development and relations with ACP States || 1 207 || 1 377 || 1 345 22 || Enlargement || 832 || 933 || 920 23 || Humanitarian aid || 829 || 1 278 || 1 249 24 || Fight against fraud || 73 || 83 || 73 25 || Commission's policy coordination & legal advice || 194 || 221 || 193 26 || Commission’s administration || 1 013 || 1 318 || 1 082 27 || Budget || 67 || 146 || 135 28 || Audit || 12 || 13 || 12 29 || Statistics || 115 || 147 || 126 30 || Pensions and related expenditure || 1 399 || 1 401 || 1 397 31 || Language Services || 397 || 506 || 436 32 || Energy || 814 || 838 || 758 33 || Justice || 184 || 208 || 195 40 || Reserves || 80 || 0 || 0 Total || || 129 310 || 148 964 || 144 766 * Including amending budgets,
appropriations carried over and assigned revenue. 1.3.4.
COMMITMENTS BY FINANCIAL FRAMEWORK HEADING || || || || EUR millions || || Initial Budget || Final Budget* || Commitments 1. || Sustainable growth || 70 630 || 75 054 || 72 682 || 1.1 Competetiveness for Growth & Employment || 16 121 || 19 191 || 17 723 || 1.2 Cohesion for Growth & Employment || 54 509 || 55 863 || 54 959 2. || Preservation & management of natural resources || 60 149 || 62 540 || 61 463 3. || Citizenship, freedom, security and justice || 2 106 || 2 846 || 2 777 4. || The EU as a global player || 9 583 || 10 015 || 9 793 5. || Administration || 4 903 || 5 258 || 5 040 6. || Compensations || 0 || 75 || 75 Total || || 147 371 || 155 788 || 151 829 * Including amending budgets,
appropriations carried over and assigned revenue. 1.3.5.
COMMITMENTS BY POLICY AREA || || || || EUR millions || || Initial Budget || Final Budget* || Commitments 01 || Economic and financial affairs || 556 || 527 || 517 02 || Enterprise || 1 154 || 1 269 || 1 241 03 || Competition || 92 || 99 || 94 04 || Employment and social affairs || 12 004 || 12 823 || 12 131 05 || Agriculture and rural development || 58 852 || 61 226 || 60 167 06 || Mobility and transport || 1 741 || 1 843 || 1 807 07 || Environment and Climate action || 498 || 518 || 506 08 || Research || 6 878 || 8 130 || 7 915 09 || Communications networks, content and technology || 1 805 || 2 131 || 2 085 10 || Direct research || 424 || 1 000 || 518 11 || Maritime affairs and Fisheries || 1 024 || 1 043 || 997 12 || Internal market || 106 || 123 || 117 13 || Regional policy || 43 389 || 44 464 || 44 170 14 || Taxation and customs union || 145 || 151 || 147 15 || Education and culture || 2 813 || 3 433 || 3 303 16 || Communication || 266 || 275 || 269 17 || Health and consumer protection || 634 || 648 || 635 18 || Home affairs || 1 296 || 1 444 || 1 420 19 || External relations || 5 001 || 5 088 || 5 023 20 || Trade || 107 || 111 || 108 21 || Development and relations with ACP States || 1 572 || 1 701 || 1 664 22 || Enlargement || 1 062 || 1 152 || 1 147 23 || Humanitarian aid || 917 || 1 360 || 1 339 24 || Fight against fraud || 79 || 79 || 79 25 || Commission's policy coordination & legal advice || 193 || 205 || 194 26 || Commission’s administration || 1 030 || 1 184 || 1 119 27 || Budget || 67 || 138 || 134 28 || Audit || 12 || 13 || 12 29 || Statistics || 134 || 144 || 134 30 || Pensions and related expenditure || 1 399 || 1 401 || 1 397 31 || Language Services || 397 || 482 || 435 32 || Energy || 738 || 818 || 782 33 || Justice || 218 || 235 || 225 40 || Reserves || 764 || 528 || 0 Total || || 147 371 || 155 788 || 151 829 * Including amending
budgets, appropriations carried over and assigned revenue. In the initial adopted EU budget,
signed by the President of the European Parliament on 12 December 2012, the
amount of payment appropriations was EUR 132 837 million (of which EUR 129 310
million was for the Commission) and the amount to be financed by own resources
totalled EUR 131 288 million. The revenue and expenditure estimates in the
initial budget are typically adjusted during the budgetary year, such
modifications being presented in amending budgets. Adjustments in the GNI-based
own resources ensure that budgeted revenue matches exactly budgeted
expenditure. In accordance with the principle of equilibrium, budget revenue
and expenditure (payment appropriations) must be in balance. Revenue: During 2013 nine amending budgets
were adopted. Taking them into account, the total final budgeted revenue for
2013 amounted to EUR 144 451 million (of which EUR 144 128 was for the
Commision). This was financed by own resources totalling EUR 140 326
million (thus EUR 9 038 million more than initially forecasted) and the
remainder by other revenue. The increased need for financing payment
appropriations was covered mainly from the call of the GNI-based resource
entered in Amending Budgets No. 2 and 8/2013. The amending letter to the Amending
Budget No. 6/2013 included fines on undertakings totalling
EUR 1 614 million that where known at the time the Draft Amending Budget No.
6/2013 was established. By 31 December 2013, other fines became definitive,
either after a definitive judgement or because companies did not appeal new
fine decisions. Revenue, contributions and refunds
in connection with Union agreements and programmes total an amount of EUR
3 888 million. The principal amounts concern the EAGF and EAFRD (and in
particular the clearance of accounts and irregularities), the participation of
third countries in research programs and other contributions and refunds to
Union programs/activities. A substantial part of this total is made of
earmarked revenue, which typically gives rise to the entering of additional
appropriations in the expenditure side. As far as the own resources result
is concerned, the collection of traditional own resources was close to the
forecasted amounts. This is primarily because the budget estimates that were modified
at the time the Amending Budget No. 6/2013 was established (they were decreased
by EUR 1 871 million according to the new macroeconomic forecasts of spring
2013) were once again amended in the Amending Letter to that Amending Budget to
take into account the actual rhythm of collection. Thus, they were once again
decreased by EUR 2 062 million. The final Member States' VAT and
GNI payments also correspond closely to the final budgetary estimates. The
differences between the forecasted amounts and the amounts actually paid are
due to the differences between the euro rates used for budgetary purposes and
the rates in force at the time when the Member States outside the EMU actually
made their payments. Expenditure: The year 2013 was the last year of
the programming period 2007-2013. The initial budget for all institutions set
commitment appropriations at EUR 150 898 million, representing
an increase of 1.7 % compared to the final 2012 budget. This was a
reduction of EUR 160 million compared to the Commission's Draft
Budget, and left a margin of EUR 2.45 billion below the ceiling of
the multi-annual financial framework. Payment appropriations were finally
set at EUR 132 837 million, after a cut of
EUR 4.96 billion to the Draft Budget 2013. This meant a decrease of
2.2 % compared to the final budget for 2012. The initial level of payment
appropriations in 2013 corresponded to 0.99 % of the Union's GNI and left
a margin of EUR 11.24 billion below the financial framework ceiling. Looking in particular at the Commission's
budget (Section III) for commitments (initial amount
EUR 147 371 million), the final budget appropriations (EUR 148 564 million),
and hence the political targets set, were fully implemented (99.8% excluding
the un-mobilised reserves). The most notable adjustments by means of
amending budgets during the year concerned the amounts necessary to accommodate
the accession of Croatia (EUR 655 million), the mobilisation of the
European Union Solidarity Fund (EUR 415 million), unforeseeable
expenditure by its very nature, and additional commitments under heading 1b for
France, Italy and Spain (EUR 150 million) arising from an agreement
by the European Council to increase their allocation under the structural
funds. The total implementation of EUR 147 684 million left EUR 880
million unused. After the carryover to 2014, an amount of EUR 702 million
lapses. However, most of this concerns un-mobilised reserves:
EUR 464 million for the European Globalisation Adjustment Fund, EUR 64 million
for the Emergency Aid Reserve and EUR 43 million from the reserve for
international fisheries agreements. The total increases to the initial
budgeted payment appropriations, introduced via amending budgets, amounted to
EUR 11.6 billion. Confronted with the heavy pressure of payment
claims and the backlog of outstanding claims from 2012, the Budget Authority
adopted increases of EUR 11.2 billion in payment appropriations in
two steps (Amending Budgets 2/2013 and 8/2013). This brought the level of
payment appropriations up to that of the ceiling of the financial framework,
helping to reduce the growth of outstanding commitments (RAL). The payment needs of the European
Union Solidarity Fund were covered by EUR 15 million of fresh
appropriations via Amending Budget 5/2013 and with a reallocation of
EUR 250 million via Amending Budget 9/2013 from some budget lines
which the Commission had proposed in the context of the Global Transfer. The
remaining EUR 150 million in payments were entered in the 2014
budget. The total implementation of final
budget payment appropriations was EUR 139 908 million, being 99.3%. This
is EUR 8 billion more than in 2012 but also EUR 7 billion
more than the financial framework ceiling for 2014. Nevertheless, the backlog
of unpaid payment claims at year-end in Cohesion increased further to
EUR 26.2 billion. Once account is taken of the carryover of payment
appropriations to 2014, a total of EUR 107 million lapses. More than half of lapsing
Commission’s appropriations arises from the rejection by the Council’s refusal
to transfer appropriations related to the salary adjustment. From payment
appropriations carried forward from 2012, an amount of EUR 54 million was
cancelled. A more detailed analysis of
budgetary adjustments, their relevant context, their justification and their
impact is presented in Commission's Report on Budgetary and Financial
Management 2013, Part A "Overview at budget level" and Part B dealing
with each heading of the multi-annual financial framework. 2.
IMPLEMENTATION OF EU BUDGET REVENUE 2.1
SUMMARY OF THE IMPLEMENTATION OF BUDGET REVENUE || || || || || || || || || || || EUR millions || Title || Income appropriations || Entitlements established || Revenue || Receipts as || Outstanding || || Initial || Final || Current year || Carried over || Total || On entitlements current year || On entitlements carried over || Total || % of budget || 1. || Own resources || 131 288 || 140 326 || 140 102 || 45 || 140 147 || 140 097 || 3 || 140 100 || 99.84% || 47 3. || Surpluses, balances and adjustments || 0 || 1 057 || 698 || 0 || 698 || 698 || 0 || 698 || 65.99% || 0 4. || Revenue accruing from persons working with the institutions & with other EU bodies || 957 || 957 || 911 || 4 || 916 || 901 || 4 || 905 || 94.56% || 11 5. || Revenue from administrative operation of institutions || 52 || 52 || 275 || 17 || 292 || 265 || 14 || 279 || 533.09% || 13 6. || Contributions and refunds in connection with community agreements & programmes || 60 || 60 || 3 593 || 503 || 4 096 || 3 493 || 396 || 3 888 || 6480.30% || 208 7. || Interest on late payments and fines || 123 || 1 642 || 2 631 || 10 774 || 13 406 || 634 || 2 338 || 2 973 || 181.05% || 10 433 8. || Borrowing and lending operations || 4 || 4 || 35 || 222 || 257 || 2 || 0 || 2 || 49.77% || 255 9. || Miscellaneous revenue || 30 || 30 || 23 || 8 || 31 || 20 || 2 || 22 || 73.39% || 9 || Total || 132 514 || 144 128 || 148 268 || 11 573 || 159 841 || 146 110 || 2 756 || 148 866 || 103.29% || 10 975 || || || || || || || || || || || Detail Title 1: Own resources || Chapter || Income appropriations || Entitlements established || Revenue || Receipts as || Outstanding || || Initial || Final || Current year || Carried over || Total || On entitlements current year || On entitlements carried over || Total || % of budget || 11. || Sugar levies || 123 || (35) || 202 || 0 || 202 || 202 || 0 || 202 || (582.66)% || 0 12. || Customs duties || 18 632 || 14 857 || 15 166 || 45 || 15 211 || 15 161 || 3 || 15 164 || 102.06% || 47 13. || VAT || 15 030 || 14 680 || 14 542 || 0 || 14 542 || 14 542 || 0 || 14 542 || 99.06% || 0 14. || GNI || 97 503 || 110 823 || 110 032 || 0 || 110 032 || 110 032 || 0 || 110 032 || 99.29% || 0 15. || Correction of budgetary imbalances || 0 || 0 || 166 || 0 || 166 || 166 || 0 || 166 || 0.00% || 0 16. || Reduction GNI-based contributions NL, S || 0 || 0 || (6) || 0 || (6) || (6) || 0 || (6) || 0.00% || 0 || Total || 131 288 || 140 326 || 140 102 || 45 || 140 147 || 140 097 || 3 || 140 100 || 99.84% || 47 Detail Title 3: Surpluses, balances and adjustments || Chapter || Income appropriations || Entitlements established || Revenue || Receipts as || Outstanding || || Initial || Final || Current year || Carried over || Total || On entitlements current year || On entitlements carried over || Total || % of budget || 30. || Surplus from previous year || 0 || 1 057 || 1 054 || 0 || 1 054 || 1 054 || 0 || 1 054 || 99.65% || 0 31. || VAT balances || 0 || 0 || (522) || 0 || (522) || (522) || 0 || (522) || 0.00% || 0 32. || GNI balances || 0 || 0 || 162 || 0 || 162 || 162 || 0 || 162 || 0.00% || 0 34. || Adjustment for non-participation in JHAP || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0.00% || 0 35. || UK correction-adjustments || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0.00% || 0 36. || UK correction - intermediate calculation || 0 || 0 || 4 || 0 || 4 || 4 || 0 || 4 || 0.00% || 0 || Total || 0 || 1 057 || 698 || 0 || 698 || 698 || 0 || 698 || 65.99% || 0 2.1.1.
Own resources revenue The vast majority of revenue comes
from own resources. This is laid down in Article 311 of the Treaty on the
Functioning of the EU, which states that: "Without prejudice to other
revenue, the budget shall be financed wholly from own resources." The main
bulk of budgetary expenditure is financed by own resources. Other revenue
represents only a minor part of total financing. Own resources can be divided into
the following categories: (1) Traditional own resources (TOR) consist of customs duties and sugar
levies. These own resources are levied on economic operators and collected by
Member States on behalf of the EU. However, Member States keep 25% as a
compensation for their collection costs. Customs duties are levied on imports
of products coming from third countries, at rates based on the Common Customs
Tariff. Sugar levies are paid by sugar producers to finance the export refunds
for sugar. TOR usually account for +/- 13% of own resource revenue. (2) The own resource based on value added tax (VAT) is levied on Member
States' VAT bases, which are harmonised for this purpose in accordance with EU
rules. The same percentage is levied on the harmonised base of each Member State. However, the VAT base to take into account is capped at 50% of each Member State’s GNI. The VAT-based resource usually accounts for around 12% of own resource
revenue. (3) The resource based on gross national income (GNI) is used to balance
budget revenue and expenditure, i.e. to finance the part of the budget not
covered by any other sources of revenue. The same percentage rate is levied on
each Member States' GNI, which is established in accordance with EU rules. The
GNI-based resource usually accounts for +/- 75% of own resource revenue. The allocation of own resources is
made in accordance with the rules laid down in the Council Decision No.
2007/436/EC, Euratom of 7 June 2007 on the system of the EU's own resources
(ORD 2007). 2.1.2.
Traditional own resources Traditional own resources: All
established traditional own resource amounts must be entered in one or other of
the accounts kept by the competent authorities. –
In the ordinary account provided for in Article
6(3)(a) of Regulation No 1150/2000: all amounts recovered or guaranteed. –
In the separate account provided for in Article
6(3)(b) of Regulation No 1150/2000: all amounts not yet recovered and/or not
guaranteed; amounts guaranteed but challenged may also be entered in this
account. For the separate account, the
Member States quarterly statement to the Commission includes: –
the balance to be recovered during the previous
quarter, –
the established entitlements during the quarter
in question, –
rectifications of the base
(corrections/cancellations) during the quarter in question, –
amounts written off (which cannot be made
available according to Article 17(2) of Regulation 1150/2000), –
the amounts recovered during the quarter in
question, –
the balance to be recovered at the end of the
quarter in question. Traditional own resources must be
entered in the Commission's account with the Treasury or the body appointed by
the Member State at the latest on the first working day following the 19th day
of the second month following the month during which the entitlement was
established (or recovered in the case of the separate account). Member States
retain, by way of collection costs, 25% of traditional own resources. The
contingent own resources entitlements are adjusted on the basis of the
likelihood of their recovery. 2.1.3.
VAT-based resources and GNI-based resources VAT-based own resources derive from
the application of a uniform rate, for all Member States, to the harmonised VAT
base determined in accordance with the rules of Article 2(1)(b) of the ORD
2007. The uniform rate is fixed at 0.30% except for the period 2007-2013 in
which the rate of call for Austria is fixed at 0.225%, for Germany at 0.15% and for Netherlands and Sweden at 0.10%. The VAT base is capped at 50% of GNI for
all Member States. The GNI-based resource is a
variable resource intended to supply the revenue required, in any given year,
to cover expenditure exceeding the amount collected from traditional own
resources, VAT resources and miscellaneous revenue. The revenue derives from
the application of a uniform rate to the aggregate GNI of all the Member
States. VAT and GNI-based resources are determined on the basis of forecasts of
VAT and GNI bases made when the draft budget is being prepared. These forecasts
are subsequently revised; the figures are updated during the budget year in
question by means of an amending budget. The actual figures for the VAT and
GNI bases are available in the course of the year following the budget year in
question. The Commission calculates the differences between the amounts due by
the Member States by reference to the actual bases and the sums actually paid
on the basis of the (revised) forecasts. These VAT and GNI balances, either
positive or negative, are called in by the Commission from the Member States
for the first working day of December of the year following the budget year in
question. Corrections may still be made to the actual VAT and GNI bases during
the subsequent four years, unless a reservation is issued. The balances
calculated earlier are adjusted and the difference is called in at the same
time as the VAT and GNI balances for the previous budget year. When conducting controls of VAT
statements and GNI data, the Commission may notify reservations to the Member
States regarding certain points which may have consequences to their own
resources contributions. These points, for example, may result from an absence
of acceptable data, or a need to develop a suitable methodology. These
reservations have to be seen as potential claims on the Member States for
uncertain amounts as their financial impact cannot be estimated with accuracy.
When the exact amount can be determined, the corresponding VAT and GNI-based
resources are called either in connection with VAT and GNI balances or by
individual calls for funds. 2.1.4.
UK correction This mechanism reduces the own
resources payments of the UK in proportion to what is known as its
"budgetary imbalance" and increases the own resources payments of the
other Member States correspondingly. The budgetary imbalance correction
mechanism in favour of the United Kingdom was instituted by the European
Council in Fontainebleau (June 1984) and the resulting Own Resources Decision
of 7 May 1985. The purpose of the mechanism was to reduce the budgetary
imbalance of the UK through a reduction in its payments to the EU. Germany, Austria, Sweden and Netherlands benefit from a reduced financing of the correction
(restricted to one fourth of their normal share). 2.1.5.
Gross reduction The European Council of 15 and 16
December 2005 concluded that the Netherlands and Sweden shall benefit from
gross reductions in their annual GNI-based contributions during the period
2007-2013. Thus this mechanism of compensation stipulates that the Netherlands shall benefit from a gross reduction in its annual GNI contribution of EUR 605 million
and Sweden from a gross reduction in its annual GNI contribution of EUR 150
million, measured in 2004 prices. 3.
IMPLEMENTATION OF EU BUDGET EXPENDITURE 3.1
BREAKDOWN & CHANGES IN COMMITMENT &
PAYMENT APPROPRIATIONS BY FINANCIAL FRAMEWORK HEADING || || || || || || || || || || || || EUR millions || Commitment appropriations || Payment appropriations Financial Framework Heading || Approps. adopted || Modifications (Transfers & AB) || Carried over || Assigned revenue || Total additional || Total authorised || Approps. adopted || Modifications (Transfers & AB) || Carried over || Assigned revenue || Total additional || Total authorised || 1 || 2 || 3 || 4 || 5=3+4 || 6=1+2+5 || 7 || 8 || 9 || 10 || 11=9+10 || 12=7+8+11 1 || Sustainable growth || 70 630 || 620 || 28 || 3 777 || 3 805 || 75 054 || 59 085 || 10 037 || 157 || 4 250 || 4 407 || 73 528 2 || Preservation and management of natural resources || 60 149 || (4) || 2 || 2 393 || 2 395 || 62 540 || 57 484 || 552 || 36 || 2 332 || 2 368 || 60 404 3 || Citizenship, freedom, security and justice || 2 106 || 507 || 0 || 233 || 233 || 2 846 || 1 515 || 450 || 9 || 224 || 232 || 2 197 4 || The EU as a global player || 9 583 || (4) || 2 || 433 || 435 || 10 015 || 6 323 || 500 || 30 || 346 || 377 || 7 200 5 || Administration || 4 903 || 0 || 0 || 355 || 355 || 5 258 || 4 903 || (1) || 299 || 358 || 657 || 5 559 6 || Compensations || 0 || 75 || 0 || 0 || 0 || 75 || 0 || 75 || 0 || 0 || 0 || 75 || Total || 147 371 || 1 193 || 31 || 7 192 || 7 223 || 155 788 || 129 310 || 11 614 || 530 || 7 510 || 8 040 || 148 964 3.2
IMPLEMENTATION OF COMMITMENT APPROPRIATIONS BY
FINANCIAL FRAMEWORK HEADING || || || || || || || || || || || || || || EUR millions || Financial Framework Heading || Commitment approps. || Commitments made || Appropriations carried over || Appropriations lapsing || || authorised || From the year’s approps. || From carry-overs || From assigned revenue || Total || % || Assigned revenue || Carry-overs by decision || Total || % || From the year’s budget approps. || From carry overs || Assigned revenue || Total || % || || 1 || 2 || 3 || 4 || 5=2+3+4 || 6=5/1 || 7 || 8 || 9=7+8 || 10=9/1 || 11 || 12 || 13 || 14=11+ 12+13 || 15=14/1 1 || Sustainable growth || 75 054 || 70 585 || 28 || 2 069 || 72 682 || 96.84% || 1 708 || 169 || 1 877 || 2.50% || 495 || 0 || 0 || 495 || 0.66% 2 || Preservation and management of natural resources || 62 540 || 60 080 || 2 || 1 381 || 61 463 || 98.28% || 1 012 || 1 || 1 013 || 1.62% || 64 || 0 || 0 || 64 || 0.10% 3 || Citizenship, freedom, security and justice || 2 846 || 2 606 || 0 || 171 || 2 777 || 97.59% || 62 || 2 || 64 || 2.26% || 4 || 0 || 0 || 4 || 0.15% 4 || The EU as a global player || 10 015 || 9 500 || 2 || 291 || 9 793 || 97.78% || 142 || 6 || 149 || 1.48% || 74 || 0 || 0 || 74 || 0.73% 5 || Administration || 5 258 || 4 838 || 0 || 202 || 5 040 || 95.85% || 153 || 0 || 153 || 2.92% || 65 || 0 || 0 || 65 || 1.24% 6 || Compensations || 75 || 75 || 0 || 0 || 75 || 100.00% || 0 || 0 || 0 || 0.00% || 0 || 0 || 0 || 0 || 0.00% || Total || 155 788 || 147 684 || 31 || 4 114 || 151 829 || 97.46% || 3 078 || 178 || 3 256 || 2.09% || 702 || 0 || 0 || 702 || 0.45% 3.3
IMPLEMENTATION OF PAYMENT APPROPRIATIONS BY
FINANCIAL FRAMEWORK HEADING || || || || || || || || || || || || || || || || EUR millions || Financial Framework Heading || Payment || Payments made || Appropriations carried over || Appropriations lapsing || || approps. authorised || From the year’s approps. || From carry-overs || From assigned revenue || Total || % || Automatic carry-overs || Carry-overs by decision || Assigned revenue || Total || % || From the year’s approps. || From carry- overs || Assigned revenue || Total || % || || 1 || 2 || 3 || 4 || 5=2+3+4 || 6=5/1 || 7 || 8 || 9 || 10=7+8+9 || 11=10/1 || 12 || 13 || 14 || 15=12+ 13+14 || 16= || || || || || || || || || || || || || || || || || 15-Jan 1 || Sustainable growth || 73 528 || 68 804 || 138 || 2 296 || 71 238 || 96.89% || 135 || 165 || 1 954 || 2 254 || 3.06% || 18 || 18 || 0 || 37 || 0.05% 2 || Preservation & management of natural resources || 60 404 || 57 980 || 32 || 1 512 || 59 524 || 98.54% || 34 || 2 || 820 || 856 || 1.42% || 20 || 4 || 0 || 24 || 0.04% 3 || Citizenship, freedom, security & justice || 2 197 || 1 703 || 8 || 173 || 1 883 || 85.71% || 9 || 251 || 51 || 311 || 14.15% || 2 || 1 || 0 || 3 || 0.15% 4 || The EU as a global player || 7 200 || 6 786 || 26 || 243 || 7 055 || 97.99% || 34 || 1 || 103 || 138 || 1.92% || 2 || 5 || 0 || 7 || 0.09% 5 || Administration || 5 559 || 4 559 || 274 || 157 || 4 990 || 89.76% || 278 || 0 || 200 || 478 || 8.61% || 65 || 26 || 0 || 91 || 1.64% 6 || Compensations || 75 || 75 || 0 || 0 || 75 || 100.00% || 0 || 0 || 0 || 0 || 0.00% || 0 || 0 || 0 || 0 || 0.00% || Total || 148 964 || 139 908 || 477 || 4 381 || 144 766 || 97.18% || 490 || 418 || 3 128 || 4 037 || 2.71% || 107 || 54 || 0 || 161 || 0.11% 3.4
MOVEMENTS IN COMMITMENTS OUTSTANDING - BY
FINANCIAL FRAMEWORK HEADING || || || || || || || || || || EUR millions || || Commitments outstanding at the end of the previous year || Commitments of the year || || Financial Framework Heading || Commitments carried forward from previous year || Decommitments /Revaluations/ Cancellations || Payments || Commitments outstanding at year-end || Commitments made during the year || Payments || Cancellation of commitments which cannot be carried over || Commitments outstanding at year-end || Total Commitments outstanding at year-end 1 || Sustainable growth || 166 271 || (1 019) || (63 822) || 101 430 || 72 682 || (7 416) || (3) || 65 263 || 166 693 2 || Preservation and management of natural resources || 26 886 || (396) || (13 444) || 13 045 || 61 463 || (46 080) || 0 || 15 383 || 28 428 3 || Citizenship, freedom, security and justice || 2 316 || (133) || (628) || 1 555 || 2 777 || (1 255) || 0 || 1 522 || 3 077 4 || The EU as a global player || 21 429 || (852) || (5 002) || 15 575 || 9 793 || (2 053) || (2) || 7 738 || 23 313 5 || Administration || 320 || (28) || (289) || 3 || 5 040 || (4 701) || (1) || 339 || 342 6 || Compensations || 0 || 0 || 0 || 0 || 75 || (75) || 0 || 0 || 0 || Total || 217 222 || (2 427) || (83 186) || 131 609 || 151 829 || (61 580) || (5) || 90 244 || 221 853 3.5
BREAKDOWN OF COMMITMENTS OUTSTANDING BY YEAR OF
ORIGIN - BY FINANCIAL FRAMEWORK HEADING || || || || || || || || || || EUR millions || Financial Framework Heading || <2007 || 2007 || 2008 || 2009 || 2010 || 2011 || 2012 || 2013 || Total 1 || Sustainable growth || 4 097 || 337 || 859 || 3 760 || 12 112 || 28 399 || 51 867 || 65 263 || 166 693 2 || Preservation & management of natural resources || 479 || 46 || 95 || 139 || 219 || 2 571 || 9 496 || 15 383 || 28 428 3 || Citizenship, freedom, security and justice || 6 || 16 || 50 || 144 || 214 || 398 || 728 || 1 522 || 3 077 4 || The EU as a global player || 956 || 415 || 823 || 1 237 || 2 375 || 3 845 || 5 923 || 7 738 || 23 313 5 || Administration || 0 || 0 || 0 || 0 || 0 || 1 || 3 || 339 || 342 || Total || 5 537 || 815 || 1 827 || 5 280 || 14 920 || 35 214 || 68 016 || 90 244 || 221 853 3.6
BREAKDOWN AND CHANGES IN COMMITMENT AND PAYMENT
APPROPRIATIONS BY POLICY AREA || || || || || || || || || || || || EUR millions || Commitment appropriations || Payment appropriations || Approps adopted || Modifications (Transfer /AB) || Carried over || Assigned revenue || Total additional || Total authorised || Approps adopted || Modifications (Transfer/ AB) || Carried over || Assigned revenue || Total additional || Total authorised || 1 || 2 || 3 || 4 || 5=3+4 || 6=1+2+5 || 7 || 8 || 9 || 10 || 11=9+10 || 12=7+8+11 01 || Economic & financial affairs || 556 || (60) || 0 || 31 || 31 || 527 || 428 || (52) || 6 || 29 || 35 || 411 02 || Enterprise || 1 154 || (16) || 0 || 131 || 131 || 1 269 || 1 162 || 214 || 19 || 192 || 211 || 1 587 03 || Competition || 92 || 1 || 0 || 6 || 6 || 99 || 92 || 1 || 8 || 6 || 13 || 107 04 || Employment & social affairs || 12 004 || 276 || 24 || 518 || 542 || 12 823 || 10 429 || 3 303 || 38 || 517 || 555 || 14 286 05 || Agriculture & rural develop. || 58 852 || (33) || 2 || 2 406 || 2 407 || 61 226 || 56 344 || 512 || 27 || 2 351 || 2 378 || 59 234 06 || Mobility & transport || 1 741 || 0 || 0 || 102 || 102 || 1 843 || 984 || 18 || 6 || 112 || 118 || 1 120 07 || Environment & Climate || 498 || (1) || 0 || 21 || 21 || 518 || 391 || 9 || 18 || 19 || 37 || 438 08 || Research || 6 878 || (4) || 0 || 1 256 || 1 256 || 8 130 || 4 808 || 174 || 26 || 1 548 || 1 573 || 6 556 09 || Communications networks, content and technology || 1 805 || 6 || 0 || 320 || 321 || 2 131 || 1 389 || 167 || 14 || 454 || 468 || 2 024 10 || Direct research || 424 || 0 || 0 || 576 || 576 || 1 000 || 411 || 8 || 48 || 491 || 539 || 959 11 || Maritime affairs & Fisheries || 1 024 || 15 || 0 || 4 || 4 || 1 043 || 794 || 30 || 3 || 4 || 7 || 831 12 || Internal market || 106 || 0 || 0 || 16 || 16 || 123 || 103 || 2 || 6 || 17 || 22 || 127 13 || Regional policy || 43 389 || 780 || 3 || 292 || 295 || 44 464 || 37 434 || 6 222 || 12 || 292 || 304 || 43 960 14 || Taxation & customs union || 145 || 1 || 0 || 6 || 6 || 151 || 112 || 16 || 7 || 5 || 12 || 140 15 || Education & culture || 2 813 || 15 || 0 || 604 || 604 || 3 433 || 2 373 || 254 || 13 || 661 || 674 || 3 301 16 || Communication || 266 || 1 || 0 || 8 || 8 || 275 || 253 || (2) || 14 || 8 || 23 || 273 17 || Health & consumer protection || 634 || (14) || 0 || 28 || 28 || 648 || 593 || (5) || 11 || 23 || 34 || 622 18 || Home affairs || 1 296 || 60 || 0 || 88 || 88 || 1 444 || 799 || 174 || 5 || 75 || 80 || 1 053 19 || External relations || 5 001 || (125) || 0 || 212 || 212 || 5 088 || 3 089 || 118 || 13 || 134 || 147 || 3 354 20 || Trade || 107 || 0 || 0 || 3 || 4 || 111 || 102 || 2 || 4 || 3 || 7 || 112 21 || Development & relations ACP || 1 572 || 1 || 2 || 127 || 129 || 1 701 || 1 207 || 23 || 11 || 136 || 147 || 1 377 22 || Enlargement || 1 062 || 54 || 0 || 35 || 35 || 1 152 || 832 || 76 || 8 || 17 || 25 || 933 23 || Humanitarian aid || 917 || 411 || 0 || 32 || 32 || 1 360 || 829 || 410 || 7 || 32 || 39 || 1 278 24 || Fight against fraud || 79 || 0 || 0 || 0 || 0 || 79 || 73 || 0 || 10 || 0 || 10 || 83 25 || Policy coordination & legal advice || 193 || 0 || 0 || 11 || 11 || 205 || 194 || 0 || 16 || 11 || 27 || 221 26 || Commission administration || 1 030 || (2) || 0 || 156 || 156 || 1 184 || 1 013 || 14 || 133 || 158 || 290 || 1 318 27 || Budget || 67 || 63 || 0 || 7 || 7 || 138 || 67 || 63 || 8 || 7 || 16 || 146 28 || Audit || 12 || 0 || 0 || 1 || 1 || 13 || 12 || 0 || 1 || 1 || 1 || 13 29 || Statistics || 134 || (1) || 0 || 11 || 11 || 144 || 115 || 7 || 6 || 19 || 24 || 147 30 || Pensions & related || 1 399 || 0 || 0 || 1 || 1 || 1 401 || 1 399 || 0 || 0 || 1 || 1 || 1 401 31 || Language Services || 397 || 0 || 0 || 86 || 86 || 482 || 397 || 0 || 24 || 86 || 109 || 506 32 || Energy || 738 || 1 || 0 || 80 || 80 || 818 || 814 || (70) || 6 || 88 || 93 || 838 33 || Justice || 218 || 1 || 0 || 16 || 16 || 235 || 184 || 4 || 4 || 15 || 19 || 208 40 || Reserves || 764 || (236) || 0 || 0 || 0 || 528 || 80 || (80) || 0 || 0 || 0 || 0 || Total || 147 371 || 1 193 || 31 || 7 192 || 7 223 || 155 788 || 129 310 || 11 614 || 530 || 7 510 || 8 040 || 148 964 3.7
IMPLEMENTATION OF COMMITMENT APPROPRIATIONS BY
POLICY AREA || || || || || || || || || || || || || || EUR millions || Policy Area || Commitment approps. authorised || Commitments made || Appropriations carried over || Appropriations lapsing || || || From the year’s approps. || From carry-overs || Assigned revenue || Total || % || Assigned revenue || Carry-overs: decision || Total || % || From year’s budget approps. || From carry-overs || Assigned revenue || Total || % || || 1 || 2 || 3 || 4 || 5=2+3+4 || 6=5/1 || 7 || 8 || 9=7+8 || 10=9/1 || 11 || 12 || 13 || 14=11+12+13 || 15=14/1 01 || Economic & financial affairs || 527 || 488 || 0 || 29 || 517 || 98.09% || 2 || 0 || 2 || 0.44% || 8 || 0 || 0 || 8 || 1.47% 02 || Enterprise || 1 269 || 1 135 || 0 || 105 || 1 241 || 97.77% || 26 || 0 || 26 || 2.03% || 2 || 0 || 0 || 2 || 0.19% 03 || Competition || 99 || 91 || 0 || 3 || 94 || 94.88% || 3 || 0 || 3 || 2.62% || 2 || 0 || 0 || 2 || 2.50% 04 || Employment & social affairs || 12 823 || 12 097 || 24 || 10 || 12 131 || 94.61% || 509 || 168 || 677 || 5.28% || 14 || 0 || 0 || 14 || 0.11% 05 || Agriculture & rural development || 61 226 || 58 797 || 2 || 1 368 || 60 167 || 98.27% || 1 038 || 0 || 1 038 || 1.69% || 21 || 0 || 0 || 21 || 0.03% 06 || Mobility & transport || 1 843 || 1 734 || 0 || 73 || 1 807 || 98.03% || 30 || 0 || 30 || 1.61% || 7 || 0 || 0 || 7 || 0.36% 07 || Environment & Climate || 518 || 495 || 0 || 11 || 506 || 97.67% || 10 || 0 || 10 || 1.88% || 2 || 0 || 0 || 2 || 0.45% 08 || Research || 8 130 || 6 874 || 0 || 1 041 || 7 915 || 97.35% || 215 || 0 || 215 || 2.64% || 0 || 0 || 0 || 0 || 0.01% 09 || Communications networks, content and technology || 2 131 || 1 810 || 0 || 276 || 2 085 || 97.84% || 45 || 0 || 45 || 2.10% || 1 || 0 || 0 || 1 || 0.06% 10 || Direct research || 1 000 || 424 || 0 || 94 || 518 || 51.79% || 482 || 0 || 482 || 48.21% || 0 || 0 || 0 || 0 || 0.00% 11 || Maritime affairs & Fisheries || 1 043 || 995 || 0 || 1 || 997 || 95.55% || 2 || 0 || 2 || 0.20% || 44 || 0 || 0 || 44 || 4.25% 12 || Internal market || 123 || 104 || 0 || 13 || 117 || 95.22% || 4 || 0 || 4 || 3.10% || 2 || 0 || 0 || 2 || 1.69% 13 || Regional policy || 44 464 || 44 162 || 3 || 5 || 44 170 || 99.34% || 287 || 0 || 287 || 0.65% || 7 || 0 || 0 || 7 || 0.02% 14 || Taxation & customs union || 151 || 144 || 0 || 3 || 147 || 97.21% || 3 || 0 || 3 || 1.81% || 1 || 0 || 0 || 1 || 0.97% 15 || Education & culture || 3 433 || 2 826 || 0 || 477 || 3 303 || 96.20% || 127 || 0 || 127 || 3.71% || 3 || 0 || 0 || 3 || 0.09% 16 || Communication || 275 || 264 || 0 || 5 || 269 || 98.10% || 3 || 0 || 3 || 1.08% || 2 || 0 || 0 || 2 || 0.82% 17 || Health & consumer protection || 648 || 614 || 0 || 20 || 635 || 97.88% || 8 || 1 || 9 || 1.35% || 5 || 0 || 0 || 5 || 0.77% 18 || Home affairs || 1 444 || 1 352 || 0 || 68 || 1 420 || 98.31% || 20 || 2 || 22 || 1.50% || 3 || 0 || 0 || 3 || 0.19% 19 || External relations || 5 088 || 4 869 || 0 || 153 || 5 023 || 98.71% || 58 || 5 || 64 || 1.25% || 2 || 0 || 0 || 2 || 0.04% 20 || Trade || 111 || 105 || 0 || 2 || 108 || 96.66% || 2 || 0 || 2 || 1.40% || 2 || 0 || 0 || 2 || 1.94% 21 || Development & relations ACP || 1 701 || 1 564 || 2 || 99 || 1 664 || 97.82% || 28 || 1 || 29 || 1.71% || 8 || 0 || 0 || 8 || 0.46% 22 || Enlargement || 1 152 || 1 115 || 0 || 31 || 1 147 || 99.53% || 4 || 0 || 4 || 0.35% || 1 || 0 || 0 || 1 || 0.13% 23 || Humanitarian aid || 1 360 || 1 326 || 0 || 12 || 1 339 || 98.42% || 20 || 0 || 20 || 1.46% || 2 || 0 || 0 || 2 || 0.11% 24 || Fight against fraud || 79 || 79 || 0 || 0 || 79 || 99.81% || 0 || 0 || 0 || 0.04% || 0 || 0 || 0 || 0 || 0.15% 25 || Policy coord & legal advice || 205 || 188 || 0 || 6 || 194 || 94.96% || 5 || 0 || 5 || 2.45% || 5 || 0 || 0 || 5 || 2.59% 26 || Commission administration || 1 184 || 1 028 || 0 || 91 || 1 119 || 94.50% || 64 || || 65 || 5.46% || 0 || 0 || 0 || 0 || 0.03% 27 || Budget || 138 || 129 || 0 || 4 || 134 || 96.82% || 3 || 0 || 3 || 2.23% || 1 || 0 || 0 || 1 || 0.95% 28 || Audit || 13 || 11 || 0 || 0 || 12 || 93.31% || 0 || 0 || 1 || 4.03% || 0 || 0 || 0 || 0 || 2.66% 29 || Statistics || 144 || 126 || 0 || 8 || 134 || 93.14% || 3 || 0 || 3 || 2.37% || 6 || 0 || 0 || 6 || 4.49% 30 || Pensions & related expenditure || 1 401 || 1 397 || 0 || 0 || 1 397 || 99.74% || 1 || 0 || 1 || 0.10% || 2 || 0 || 0 || 2 || 0.16% 31 || Language Services || 482 || 387 || 0 || 48 || 435 || 90.08% || 38 || 0 || 38 || 7.84% || 10 || 0 || 0 || 10 || 2.08% 32 || Energy || 818 || 734 || 0 || 48 || 782 || 95.66% || 31 || 0 || 31 || 3.82% || 4 || 0 || 0 || 4 || 0.52% 33 || Justice || 235 || 216 || 0 || 8 || 225 || 95.71% || 8 || 0 || 8 || 3.23% || 2 || 0 || 0 || 2 || 1.06% 40 || Reserves || 528 || 0 || 0 || 0 || 0 || 0.00% || 0 || 0 || 0 || 0.00% || 528 || 0 || 0 || 528 || 100.00% || Total || 155 788 || 147 684 || 31 || 4 113 || 151 829 || 97.46% || 3 078 || 178 || 3 256 || 2.09% || 702 || 0 || 0 || 702 || 0.45% 3.8
IMPLEMENTATION OF PAYMENT APPROPRIATIONS BY
POLICY AREA || || || || || || || || || || || || || || || || EUR millions || Policy Area || Payment approps. || Payments made || Appropriations carried over || Appropriations lapsing || || authorised || From the year's approps. || From carry-overs || Assigned revenue || Total || % || Automatic carry-overs || Carry-overs by decision || Assigned revenue || Total || % || From the year's approps. || From carry-overs || Assigned revenue || Total || % || || 1 || 2 || 3 || 4 || 5=2+3+4 || 6=5/1 || 7 || 8 || 9 || 10=7+8+9 || 11=10/1 || 12 || 13 || 14 || 15=12+13+14 || 16=15/1 01 || Economic & financial affairs || 411 || 366 || 6 || 26 || 397 || 96.68% || 8 || 0 || 3 || 11 || 2.60% || 2 || 1 || 0 || 3 || 0.72% 02 || Enterprise || 1 587 || 1 359 || 17 || 80 || 1 456 || 91.76% || 14 || 0 || 111 || 126 || 7.91% || 3 || 2 || 0 || 5 || 0.33% 03 || Competition || 107 || 84 || 7 || 2 || 93 || 87.19% || 7 || 0 || 3 || 10 || 9.61% || 2 || 1 || 0 || 3 || 3.20% 04 || Employment & social affairs || 14 286 || 13 672 || 36 || 399 || 14 107 || 98.74% || 14 || 36 || 117 || 168 || 1.18% || 9 || 2 || 0 || 11 || 0.08% 05 || Agriculture & rural development || 59 234 || 56 815 || 23 || 1 501 || 58 339 || 98.49% || 21 || 0 || 850 || 871 || 1.47% || 20 || 4 || 0 || 24 || 0.04% 06 || Mobility & transport || 1 120 || 990 || 5 || 64 || 1 059 || 94.58% || 6 || 0 || 48 || 54 || 4.86% || 5 || 1 || 0 || 6 || 0.56% 07 || Environment & Climate || 438 || 377 || 17 || 12 || 406 || 92.71% || 21 || 0 || 7 || 28 || 6.41% || 3 || 1 || 0 || 4 || 0.89% 08 || Research || 6 556 || 4 958 || 23 || 790 || 5 771 || 88.02% || 24 || 0 || 758 || 782 || 11.92% || 0 || 3 || 0 || 3 || 0.05% 09 || Communications networks, content and technology || 2 024 || 1 539 || 13 || 273 || 1 826 || 90.21% || 15 || 0 || 181 || 196 || 9.69% || 1 || 1 || 0 || 2 || 0.10% 10 || Direct research || 959 || 366 || 41 || 89 || 496 || 51.68% || 54 || 0 || 402 || 456 || 47.57% || 0 || 7 || 0 || 7 || 0.75% 11 || Maritime affairs & Fisheries || 831 || 816 || 3 || 1 || 820 || 98.71% || 3 || 1 || 2 || 7 || 0.87% || 3 || 1 || 0 || 4 || 0.42% 12 || Internal market || 127 || 97 || 5 || 13 || 116 || 90.79% || 6 || 0 || 3 || 9 || 7.08% || 2 || 1 || 0 || 3 || 2.13% 13 || Regional policy || 43 960 || 43 262 || 10 || 222 || 43 494 || 98.94% || 12 || 380 || 70 || 461 || 1.05% || 2 || 2 || 0 || 4 || 0.01% 14 || Taxation & customs union || 140 || 120 || 7 || 3 || 129 || 92.07% || 7 || 0 || 3 || 9 || 6.71% || 1 || 0 || 0 || 2 || 1.22% 15 || Education & culture || 3 301 || 2 614 || 12 || 426 || 3 052 || 92.45% || 11 || 0 || 235 || 247 || 7.47% || 2 || 1 || 0 || 3 || 0.08% 16 || Communication || 273 || 234 || 14 || 5 || 252 || 92.32% || 14 || 0 || 4 || 17 || 6.34% || 3 || 1 || 0 || 4 || 1.34% 17 || Health & consumer protection || 622 || 574 || 10 || 15 || 599 || 96.32% || 12 || 0 || 8 || 19 || 3.09% || 3 || 1 || 0 || 4 || 0.59% 18 || Home affairs || 1 053 || 966 || 5 || 64 || 1 035 || 98.33% || 4 || 0 || 11 || 15 || 1.41% || 2 || 1 || 0 || 3 || 0.26% 19 || External relations || 3 354 || 3 189 || 11 || 94 || 3 295 || 98.23% || 17 || 0 || 39 || 56 || 1.68% || 1 || 2 || 0 || 3 || 0.09% 20 || Trade || 112 || 99 || 4 || 2 || 104 || 93.10% || 3 || 0 || 2 || 5 || 4.67% || 2 || 0 || 0 || 2 || 2.23% 21 || Development & relations ACP || 1 377 || 1 212 || 9 || 124 || 1 345 || 97.67% || 11 || 0 || 12 || 24 || 1.71% || 7 || 2 || 0 || 8 || 0.61% 22 || Enlargement || 933 || 901 || 6 || 12 || 920 || 98.56% || 5 || 0 || 5 || 10 || 1.07% || 2 || 2 || 0 || 3 || 0.37% 23 || Humanitarian aid || 1 278 || 1 230 || 7 || 12 || 1 249 || 97.74% || 8 || 0 || 20 || 28 || 2.17% || 1 || 0 || 0 || 1 || 0.09% 24 || Fight against fraud || 83 || 65 || 8 || 0 || 73 || 87.45% || 9 || 0 || 0 || 9 || 10.39% || 0 || 2 || 0 || 2 || 2.16% 25 || Policy coordination & legal advice || 221 || 175 || 13 || 5 || 193 || 87.38% || 14 || 0 || 6 || 20 || 9.04% || 5 || 3 || 0 || 8 || 3.57% 26 || Commission administration || 1 318 || 894 || 125 || 64 || 1 082 || 82.08% || 134 || 0 || 94 || 227 || 17.26% || 1 || 8 || 0 || 9 || 0.67% 27 || Budget || 146 || 124 || 8 || 3 || 135 || 91.97% || 6 || 0 || 4 || 10 || 6.75% || 1 || 1 || 0 || 2 || 1.29% 28 || Audit || 13 || 11 || 0 || 0 || 12 || 89.13% || 0 || 0 || 0 || 1 || 8.05% || 0 || 0 || 0 || 0 || 2.82% 29 || Statistics || 147 || 115 || 5 || 7 || 126 || 85.55% || 6 || 0 || 12 || 18 || 12.02% || 2 || 1 || 0 || 4 || 2.43% 30 || Pensions & related expenditure || 1 401 || 1 397 || 0 || 0 || 1 397 || 99.74% || 0 || 0 || 1 || 1 || 0.10% || 2 || 0 || 0 || 2 || 0.16% 31 || Language Services || 506 || 371 || 22 || 44 || 436 || 86.22% || 16 || 0 || 42 || 58 || 11.42% || 10 || 2 || 0 || 12 || 2.36% 32 || Energy || 838 || 734 || 5 || 20 || 758 || 90.53% || 5 || 0 || 68 || 73 || 8.76% || 5 || 1 || 0 || 6 || 0.71% 33 || Justice || 208 || 183 || 3 || 9 || 195 || 93.62% || 4 || 0 || 6 || 10 || 4.62% || 2 || 1 || 0 || 4 || 1.75% 40 || Reserves || 0 || 0 || 0 || 0 || 0 || 0.00% || 0 || 0 || 0 || 0 || 0.00% || 0 || 0 || 0 || 0 || 0.00% || Total || 148 964 || 139 908 || 476 || 4 381 || 144 766 || 97.18% || 489 || 419 || 3 128 || 4 037 || 2.71% || 107 || 54 || 0 || 161 || 0.11% 3.9
MOVEMENTS IN COMMITMENTS OUTSTANDING BY POLICY
AREA || || || || || || || || || || EUR millions || || Commitments outstanding at end of the previous year || Commitments of the year || || Policy Area || Commitments carried forward from previous year || Decommitments /Revaluations/Cancellations || Payments || Commitments outstanding at year-end || Commitments made during the year || Payments || Cancellation commitments which cannot be carried over || Commitments outstanding at year-end || Total commitments outstanding at year-end 01 || Economic & financial affairs || 623 || (3) || (142) || 478 || 517 || (256) || 0 || 261 || 739 02 || Enterprise || 2 090 || (20) || (963) || 1 107 || 1 241 || (493) || 0 || 748 || 1 855 03 || Competition || 8 || (1) || (7) || 0 || 94 || (86) || 0 || 8 || 8 04 || Employment & social affairs || 29 668 || (133) || (13 541) || 15 994 || 12 131 || (566) || 0 || 11 565 || 27 559 05 || Agriculture & rural development || 23 847 || (320) || (12 377) || 11 150 || 60 167 || (45 962) || 0 || 14 205 || 25 354 06 || Mobility and transport || 3 317 || (64) || (885) || 2 368 || 1 807 || (174) || 0 || 1 633 || 4 001 07 || Environment & Climate || 1 002 || (12) || (268) || 723 || 506 || (138) || 0 || 368 || 1 090 08 || Research || 10 781 || (92) || (3 109) || 7 579 || 7 915 || (2 661) || (2) || 5 252 || 12 831 09 || Communications networks, content and technology || 2 594 || (31) || (952) || 1 611 || 2 085 || (874) || 0 || 1 211 || 2 822 10 || Direct research || 199 || (20) || (121) || 59 || 518 || (375) || 0 || 143 || 202 11 || Maritime affairs & Fisheries || 2 290 || (107) || (633) || 1 551 || 997 || (188) || 0 || 809 || 2 360 12 || Internal market || 21 || (2) || (16) || 4 || 117 || (100) || 0 || 17 || 21 13 || Regional policy || 112 307 || (811) || (42 832) || 68 664 || 44 170 || (662) || 0 || 43 508 || 112 172 14 || Taxation & customs union || 93 || (5) || (59) || 29 || 147 || (70) || 0 || 77 || 106 15 || Education & culture || 2 194 || (57) || (938) || 1 199 || 3 303 || (2 114) || 0 || 1 188 || 2 387 16 || Communication || 119 || (10) || (84) || 25 || 269 || (168) || 0 || 101 || 126 17 || Health & consumer protection || 642 || (62) || (293) || 288 || 635 || (306) || 0 || 328 || 616 18 || Home affairs || 1 677 || (69) || (331) || 1 277 || 1 420 || (704) || 0 || 715 || 1 992 19 || External relations || 11 342 || (352) || (2 421) || 8 569 || 5 023 || (874) || 0 || 4 149 || 12 718 20 || Trade || 18 || (1) || (11) || 6 || 108 || (93) || 0 || 15 || 21 21 || Development & relations ACP || 3 453 || (103) || (905) || 2 444 || 1 664 || (439) || 0 || 1 225 || 3 669 22 || Enlargement || 3 039 || (58) || (763) || 2 218 || 1 147 || (157) || (1) || 988 || 3 206 23 || Humanitarian aid || 831 || (3) || (555) || 273 || 1 339 || (694) || 0 || 645 || 918 24 || Fight against fraud || 35 || (3) || (18) || 14 || 79 || (55) || 0 || 25 || 38 25 || Policy coordination & legal advice || 17 || (3) || (14) || 0 || 194 || (179) || 0 || 15 || 15 26 || Commission administration || 174 || (10) || (153) || 11 || 1 119 || (929) || 0 || 190 || 201 27 || Budget || 8 || (1) || (8) || 0 || 134 || (127) || 0 || 7 || 7 28 || Audit || 1 || 0 || 0 || 0 || 12 || (11) || 0 || 1 || 1 29 || Statistics || 114 || (9) || (48) || 57 || 134 || (78) || 0 || 55 || 113 30 || Pensions & related expenditure || 0 || 0 || 0 || 0 || 1 397 || (1 397) || 0 || 0 || 0 31 || Language Services || 24 || (2) || (22) || 0 || 435 || (415) || 0 || 20 || 20 32 || Energy || 4 517 || (40) || (639) || 3 838 || 782 || (119) || 0 || 664 || 4 502 33 || Justice || 179 || (25) || (79) || 75 || 225 || (116) || 0 || 109 || 184 || Total || 217 222 || (2 427) || (83 186) || 131 609 || 151 829 || (61 580) || (5) || 90 244 || 221 853 3.10
BREAKDOWN OF COMMITMENTS OUTSTANDING BY YEAR OF
ORIGIN BY POLICY AREA || || || || || || || || || || EUR millions || Policy Area || <2007 || 2007 || 2008 || 2009 || 2010 || 2011 || 2012 || 2013 || Total 01 || Economic & financial affairs || 32 || 10 || 0 || 0 || 73 || 184 || 180 || 261 || 739 02 || Enterprise || 4 || 14 || 23 || 55 || 135 || 364 || 513 || 748 || 1 855 03 || Competition || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 8 || 8 04 || Employment & social affairs || 673 || 57 || 7 || 246 || 924 || 4 862 || 9 225 || 11 565 || 27 559 05 || Agriculture & rural development || 196 || 0 || 0 || 2 || 144 || 2 079 || 8 729 || 14 205 || 25 354 06 || Mobility & transport || 21 || 103 || 48 || 211 || 375 || 707 || 903 || 1 633 || 4 001 07 || Environment & Climate || 8 || 45 || 65 || 105 || 133 || 170 || 197 || 368 || 1 090 08 || Research || 102 || 85 || 209 || 397 || 1 003 || 2 069 || 3 714 || 5 252 || 12 831 09 || Communications networks, content and technology || 7 || 15 || 30 || 115 || 188 || 394 || 863 || 1 211 || 2 822 10 || Direct research || 3 || 1 || 9 || 5 || 5 || 8 || 27 || 143 || 202 11 || Maritime affairs & Fisheries || 275 || 1 || 3 || 10 || 44 || 490 || 728 || 809 || 2 360 12 || Internal market || 0 || 0 || 0 || 0 || 1 || 0 || 3 || 17 || 21 13 || Regional policy || 3 583 || 9 || 421 || 1 560 || 7 925 || 19 331 || 35 836 || 43 508 || 112 172 14 || Taxation & customs union || 0 || 0 || 0 || 0 || 0 || 7 || 22 || 77 || 106 15 || Education & culture || 1 || 33 || 54 || 81 || 138 || 332 || 560 || 1 188 || 2 387 16 || Communication || 0 || 0 || 0 || 0 || 1 || 3 || 19 || 101 || 126 17 || Health & consumer protection || 4 || 1 || 30 || 29 || 52 || 65 || 108 || 328 || 616 18 || Home affairs || 0 || 14 || 41 || 128 || 183 || 340 || 570 || 715 || 1 992 19 || External relations || 335 || 318 || 573 || 822 || 1 257 || 1 971 || 3 293 || 4 149 || 12 718 20 || Trade || 0 || 0 || 0 || 0 || 0 || 2 || 4 || 15 || 21 21 || Development & relations ACP || 92 || 41 || 118 || 227 || 352 || 609 || 1 005 || 1 225 || 3 669 22 || Enlargement || 137 || 45 || 125 || 172 || 369 || 600 || 770 || 988 || 3 206 23 || Humanitarian aid || 1 || 1 || 9 || 14 || 28 || 37 || 182 || 645 || 918 24 || Fight against fraud || 0 || 1 || 1 || 1 || 2 || 3 || 6 || 25 || 38 25 || Policy coordination & legal advice || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 15 || 15 26 || Commission administration || 0 || 0 || 0 || 0 || 0 || 0 || 11 || 190 || 201 27 || Budget || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 7 || 7 28 || Audit || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 1 || 1 29 || Statistics || 2 || 0 || 0 || 1 || 6 || 18 || 31 || 55 || 113 30 || Pensions & related expenditure || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 31 || Language Services || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 20 || 20 32 || Energy || 61 || 21 || 62 || 1 095 || 1 576 || 549 || 475 || 664 || 4 502 33 || Justice || 0 || 0 || 2 || 5 || 7 || 18 || 43 || 109 || 184 || Total || 5 537 || 815 || 1 827 || 5 280 || 14 920 || 35 214 || 68 016 || 90 244 || 221 853 Financial
Framework 2007-2013 || || || || || || || EUR millions || 2007 || 2008 || 2009 || 2010 || 2011 || 2012 || 2013 || Total 1. Sustainable Growth || 53 979 || 57 653 || 61 696 || 63 555 || 63 974 || 67 614 || 70 644 || 439 115 2. Preservation & management of natural resources || 55 143 || 59 193 || 56 333 || 59 955 || 59 888 || 60 810 || 61 289 || 412 611 3. Citizenship, freedom, security & justice || 1 273 || 1 362 || 1 518 || 1 693 || 1 889 || 2 105 || 2 407 || 12 247 4. EU as a global player || 6 578 || 7 002 || 7 440 || 7 893 || 8 430 || 8 997 || 9 595 || 55 935 5. Administration || 7 039 || 7 380 || 7 525 || 7 882 || 8 091 || 8 523 || 8 492 || 54 932 6. Compensations || 445 || 207 || 210 || 0 || 0 || 0 || 75 || 937 Commitment appropriations: || 124 457 || 132 797 || 134 722 || 140 978 || 142 272 || 148 049 || 152 502 || 975 777 || || || || || || || || Total payment appropriations: || 122 190 || 129 681 || 120 445 || 134 289 || 133 700 || 141 360 || 144 285 || 925 950 This section describes the main
categories of EU expenditure, classified by heading of the financial framework
2007-2013. The 2013 financial year was the seventh and last covered by the
financial framework 2007-2013. The overall ceiling on commitments
appropriations for 2013 comes to EUR 152 502 million, equivalent to
1.15% of GNI. The corresponding ceiling on the appropriations for payments
comes to EUR 144 285 million, i.e. 1.08 % of GNI. The above table shows the
financial framework at current prices. Heading 1 – Sustainable growth This heading is divided into two
separate, but interlinked components: 1a. Competitiveness for growth and employment, encompassing expenditure
on research and innovation, education and training, trans-European networks,
social policy, the internal market and accompanying policies. 1b. Cohesion for growth and employment, designed to enhance convergence
of the least developed Member States and regions, to complement the EU strategy
for sustainable development outside the less prosperous regions and to support
inter regional cooperation.. Heading 2 – Preservation and management of
natural resources Heading 2 includes the common
agricultural and fisheries policies, rural development and environmental
measures, in particular Natura 2000. The amount earmarked for the common
agricultural policy reflects the agreement reached at the European Council in
October 2002. Heading 3 – Citizenship, freedom, security
and justice Heading 3 (Citizenship, freedom,
security and justice) reflects the growing importance attached to certain
fields where the EU has been assigned particular tasks – justice and home
affairs, border protection, immigration and asylum policy, public health and
consumer protection, culture, youth, information and dialogue with citizens. It
is split in two components: 3a. Freedom, Security and Justice 3b. Citizenship Heading 4 – The EU as a global player Heading 4 covers all external
action, including pre-accession instruments. Whereas the Commission had
proposed to integrate the EDF into the financial framework, the European
Parliament and the European Council agreed to leave it outside. Heading 5 - Administration This heading covers administrative
expenditure for all institutions, pensions and the European Schools. For the
Institutions other than the Commission, these costs make up the total of their
expenditure, but the Agencies and other bodies make both administrative and
operational expenditure. Heading 6 - Compensations In accordance with the political
agreement that the new Member States should not become net-contributors to the
budget at the very beginning of their membership, compensation was foreseen
under this heading. This amount was available as transfers to them to balance
their budgetary receipts and contributions. Policy areas As part of its use of Activity
Based Management (ABM) the Commission implements Activity Based Budgeting (ABB)
in its planning and management processes. ABB involves a budget structure where
budget titles correspond to policy areas and budget chapters to activities. ABB
aims to provide a clear framework for translating the Commission's policy
objectives into action, either through legislative, financial or any other
public policy means. By structuring the Commission's work in terms of
activities, a clear picture is obtained of the Commission's undertakings and
simultaneously a common framework is established for priority setting.
Resources are allocated to priorities during the budget procedure, using the
activities as the building blocks for budgeting purposes. By establishing such
a link between activities and the resources allocated to them, ABB aims to
increase efficiency and effectiveness in the use of resources in the
Commission. A policy area may be defined as a
homogeneous grouping of activities constituting parts of the Commission's work,
which are relevant for the decision-making process. Each policy area
corresponds, in general, to a DG, and encompassing an average of about 6 or 7
individual activities. Policy areas are mainly operational, since their core
activities aim at benefiting a third-party beneficiary within their respective
domains of activity. The operational budget is completed with the necessary
administrative expenditure for each policy area.