1.   All items of revenue and expenditure of the Centre shall be included in estimates based on a costed annual work programme to be drawn up for each financial year and shall be shown in the budget.

2.   The revenue and expenditure shown in the budget shall be in balance.

1.   Revenue shall include the contribution by the EDF, the amount levied in taxes on the salaries, wages and other emoluments paid by the Centre, and other miscellaneous receipts.

2.   Revenue shall include contributions from other donors to the budget of the Centre.

3.   In accordance with Article 4(3) of its Statutes and Rules of Procedure, the Centre may also manage on behalf of third Parties resources intended for the execution of activities laid down for it in the Agreement. The financial rules applicable to the management of these resources are set out in Article 37 of this Financial Regulation.

1.   The financial year shall begin on 1 January and end on 31 December.

2.   Appropriations entered in the budget shall be authorised for a period of one financial year.

3.   If, at the beginning of a financial year, the budget for that year has not been finally adopted, the Director shall, in order to ensure continuity in the operation of the Centre, authorise commitment to, authorisation of and payment of monthly administrative and operating expenditure in accordance with the procedures laid down in this Financial Regulation. Such monthly expenditure for the current year may not, however, exceed one twelfth of the corresponding appropriations, article by article, approved in the budget for the preceding year.

1.   Budget appropriations shall be used in accordance with the principle of sound financial management, that is to say economy, efficiency and effectiveness.

2.   The principle of economy requires that the resources used by the Centre to implement its activities shall be made available in due time, in appropriate quantity and quality and at the best price.

The principle of efficiency is concerned with the best relationship between resources employed and results achieved.

The principle of effectiveness is concerned with attaining the specific objectives set and achieving the intended results.

3.   Specific, measurable, achievable, relevant and timed objectives shall be set for all sectors of activity covered by the budget. Achievement of those objectives shall be monitored by performance indicators for each activity, and information shall be provided to the Executive Board by the Director. This information shall be provided annually at the latest in the documents accompanying the preliminary draft budget and should be provided along with the documents supplied to the Commission justifying the annual amount requested by the Centre from the EDF.

4.   In order to improve decision-making, the Centre shall regularly carry out ex ante and ex post evaluations of programmes or activities in accordance with a multi-annual programme of evaluation to be fixed in agreement with the Commission. Evaluation results shall be included in the documents supplied to the Commission justifying the annual amount requested by the Centre from the EDF.

1.   Within the limits of the overall budget allocated to the Centre by the financial protocol, increased by possible contributions from other donors, and on the basis of the guidelines laid down by the strategy approved by the Committee, the Director shall draw up a draft annual work programme and related budget. This draft shall be forwarded to the Executive Board no later than 15 July of the year preceding its implementation.

The annual work programme and related budget shall be approved by the Executive Board by 31 July and submitted to the Committee of Ambassadors for adoption. The budget shall be forwarded to the Commission of the European Communities (hereinafter referred to as the Commission), which shall initiate the Community procedures in force as regards the contribution requested from the EDF, on the basis of the separate allocation provided for this purpose.

2.   The budget shall only be available for commitment as from the date on which the competent Community authority takes the financing decision on the contribution requested from the EDF. The Centre shall be informed of this decision.

3.   The terms and conditions applicable to the contribution from the EDF shall be fixed in a financing agreement signed between the Centre and the Commission.

4.   The budget shall include proper estimates of revenue from other donors.

1.   The dates for the payment of the contribution from the EDF shall be fixed in the financing agreement referred to in Article 7(3). The contribution from preceding financial years representing lapsed appropriations shall be deducted.

2.   The budget shall be subdivided into titles (budget headings), chapters, articles and items according to the nature or purpose of the revenue or expenditure.

1.   The Director shall implement the budget on his own responsibility, in accordance with the principles set out in section I, and within the limits of the appropriations authorised. He shall report to the Executive Board on the administration of the budget.

2.   The authorised appropriations shall be used only in accordance with the principles and rules laid down in the Financial Regulation and in particular the principle of sound financial management as defined in Article 6.

1.   No revenue shall be collected or expenditure effected unless credited to or charged against an appropriate article in the budget.

No expenditure may be committed or authorised in excess of the appropriations authorised for the financial year concerned or of the appropriations carried over from previous financial years.

2.   Revenue and expenditure shall be entered in full in the accounts without any adjustment against each other.

1.   Transfers from one title to another shall be decided by the Director, except where transfers from or to articles related to staff emoluments are concerned. He shall inform the Executive Board of his decisions at its next meeting.

Transfers from one title to another, where articles related to staff emoluments are concerned, shall be decided by the Executive Board, on the basis of a proposal from the Director.

2.   Transfers from one chapter to another and within chapters shall de decided by the Director, who shall inform the Executive Board accordingly.

1.   The financial control shall be composed of a financial controller and, if necessary, one or more assistant controllers, who must all be experienced in the financial regulations of international organisations.

2.   The controller shall report for administrative purposes directly to the Director and the assistant controllers shall report directly to the controller.

3.   The controller and the assistant controllers shall be appointed by the Executive Board. The controller and the assistant controllers shall be bound by the Staff Regulations in force. However, any measures relating to disciplinary action, suspension, termination of employment or legal proceedings must be endorsed by the Executive Board, on the basis of a fully substantiated proposal from the Director.

4.   Before any operation is authorised by an authorising officer, the operational and financial aspects shall be verified by the financial control. The purpose of this verification shall be to ascertain that:

This verification shall result in the granting or withholding of approval.

The financial control shall withhold its approval if it considers that the above conditions are not fulfilled. In each case where approval is withheld, the financial control shall make a written statement, stating the full reasons therefor, and shall notify the Director.

Except where the availability of the appropriations is in doubt, the Director may, by a decision stating the full reasons therefor and taken on his sole responsibility, overrule such a refusal. This decision shall be final and binding and shall be communicated for information to the financial control. The Director shall inform the Executive Board of all such decisions in writing at its next meeting.

The financial control shall have access to all the supporting documents and to any other document relating to the expenditure and revenue to be verified. It may carry out verifications on the spot.

5.   In carrying out their duties, the controller and the assistant controllers shall enjoy complete independence. They shall not receive any instruction nor have any restriction imposed with regard to carrying out the duties assigned to them by virtue of this Financial Regulation as a consequence of their appointment.

6.   The Director may request the financial control to give its opinion on matters relating to the diagnosis, organisation or improvement of the Centre’s internal procedures. The Director may also request the financial control to carry out verifications of documents and, where appropriate, on-the-spot verifications to check that operations financed by the budget have been correctly implemented.

7.   At the end of each financial year, and no later than 30 April of the following year, the financial control shall prepare an activity report in which it gives its opinion on the financial management and on the implementation of the budget. It shall submit its report to the Director, who shall forward it, along with his comments if necessary, to the Executive Board at its next meeting.

1.   The budget of the Centre shall be administered in accordance with the principle that authorising officers and accounting officers are different individuals.

2.   The duties of authorising officer, controller and accounting officer shall be mutually incompatible.

3.   The appropriations shall be administered by the authorising officer, who alone shall be empowered to enter into commitments regarding expenditure, determine entitlements to be collected and issue recovery and payment orders. Collection and payment operations shall be carried out by the accounting officer.

1.   All measures which may give rise to expenditure payable by the Centre shall be preceded by a proposal for commitment from the authorising officer. The proposal, accompanied by the original supporting documents, shall be sent to the financial control for prior verification.

2.   A provisional commitment may be entered into in respect of recurrent expenditure.

3.   An account shall be kept of commitments and payment orders.

1.   The purpose of validation of expenditure by the authorising officer shall be:

2.   Validation of any expenditure shall be subject to the submission of supporting documents showing the creditor’s claim and, where appropriate, the service rendered.

1.   Authorisation is the act whereby the authorising officer, by the issue of a payment order, instructs the accounting officer to pay an item of expenditure which he has validated.

2.   The payment order shall be accompanied by the original supporting documents, which shall bear or be accompanied by the approval of the authorising officer confirming that the amounts to be paid are correct, that the supplies have been received or that the service has been performed.

3.   Copies of the supporting documents, certified as true copies by the authorising officer may, in some cases, be accepted in place of the originals.

4.   Payment orders shall be sent to the financial control for prior verification.

1.   Payment is the final action whereby the Centre is discharged of its obligations towards its creditors.

2.   Payment shall be made by the accounting officer within the limits of the funds available.

3.   In the event of a substantive error or of the validity of the discharge being contested or of failure to observe the formalities prescribed by this Financial Regulation, the accounting officer shall immediately inform the authorising officer and the financial control. The Director may require in writing, and on his own responsibility, that payment is made. The Director shall inform the Executive Board of all such decisions in writing at its next meeting.

1.   Payments shall, as a general rule, be made through a bank account, preferably by bank transfer or, where good grounds exist, by cheque. The transactions shall be denominated in euro. In exceptional cases, and if appropriate, another currency may be used.

2.   Cheques and bank transfer orders shall bear two signatures, one of which must be that of the accounting officer.

3.   For duly substantiated reasons, the Director may authorise cash payments. A receipt shall be obtained in respect of those payments.

4.   In the absence of the actual exchange rates used, the conversion rates to be used for the calculation in euro of payments to be made, or of revenue to be collected in local ACP currencies, shall be those in force on the first working day of the month in which the real date of the operation falls, as recorded by the European Central Bank.

1.   For the payment of certain categories of expenditure, imprest accounts may be set up in accordance with the conditions laid down by the Centre.

2.   Each decision to grant an imprest account shall be taken by the Director on the basis of a proposal from the staff member in charge of the file. Prior to submission to the Director, each proposal must be approved by the accounting officer and agreed by the financial control.

3.   Each decision shall specify:

4.   Each payment of an advance must also be preceded by a commitment.

5.   The authorising officer and the accounting officer shall take whatever steps are necessary to ensure that clearances in respect of the advances granted are issued for the correct amounts and within an appropriate lapse of time.

1.   The Director shall be the authorising officer for the appropriations entered in the budget of the Centre.

2.   The Director may delegate some of his duties to staff members under his authority. Each decision to delegate powers shall state the duration and extent of the mandate to act as authorising officer.

3.   The Director may delegate certain duties related to implementation to carefully selected appropriate third parties.

1.   The accounting officer shall be appointed by the Director with the endorsement of the Executive Board.

2.   He shall be responsible in the Centre for:

3.   The accounting officer shall obtain from the authorising officer, who shall guarantee its reliability, all the information necessary for the production of accounts which accurately represent the Centre’s financial assets and budget implementation.

4.   Subject to paragraph 5 of this Article and Article 22, the accounting officer is the only person empowered to manage monies and other assets. He shall be responsible for their safekeeping.

5.   The accounting officer may delegate certain tasks to subordinates subject to the Staff Regulations, where this is indispensable for the performance of his duties.

6.   The instrument of delegation shall lay down the tasks entrusted to the subordinates and their rights and obligations.

1.   The recovery of any sum due to the Centre shall give rise to the issue of a recovery order by the authorising officer. Recovery orders shall be submitted to the internal control body for prior verification.

2.   The accounting officer shall assume responsibility for recovery orders forwarded to him by the authorising officer.

3.   A receipt shall be issued in respect of all cash payments made to the accounting officer or imprest administrator.

1.   The accounts shall be kept in euro, by the double entry method and on the basis of the calendar year. They shall show all revenue and expenditure from 1 January to 31 December of each year and shall include the original supporting documents.

The accounts shall be closed at the end of the financial year to enable the Centre’s financial statements to be drawn up.

2.   Entries shall be made on the basis of an accounting system comprising a nomenclature of budgetary items which makes a clear distinction between the accounts that permit the balance sheet to be drawn up and those that permit the revenue and expenditure account to be drawn up. These entries may be recorded in a computerised system, which will make it possible to draw up a general monthly balance. All imprests shall be entered in a suspense account and cleared no later than the end of the following financial year, except in the case of standing imprests.

3.   When the authorising officer, the controller and the accounting officer consider by mutual agreement that the system offers guarantees that satisfy requirements in terms of security, the Centre may use electronic processing.

4.   The separate accounts kept for the resources managed on behalf of third Parties, as provided for in Article 37, shall be consolidated in the balance sheet and the revenue and expenditure account of the Centre.

5.   The Centre shall draw up a balance sheet and a revenue and expenditure account no later than 31 March of year N + 1.

The balance sheet shall show the assets and liabilities of the Centre at 31 December of year N.

The revenue and expenditure account shall include:

6.   Each quarter a statement shall be drawn up showing the situation as regards implementation of the current budget and use of the appropriations carried over; this statement shall be certified by the financial control and forwarded to the Executive Board.

1.   The Executive Board shall appoint a firm of auditors of international repute for a period of three years from a list of at least three proposed firms in order to audit the financial statements of the Centre. However, the same firm of auditors cannot be appointed for more than three consecutive years.

2.   The auditors shall audit the books and the cash held at the Centre, verify that the inventories and balance sheets have been drawn up in a proper manner and in good faith, in accordance with proper accounting procedures, and ensure that the information regarding the accounts of the Centre is correct.

The purpose of the audit shall be to establish that all revenue due has been received and all expenditure incurred in a lawful and proper manner and that the financial management has been sound.

The auditors shall certify that the financial statements have been drawn up in a proper manner according to international accounting standards, and that they represent a true and fair view of the financial position of the Centre.

3.   The auditors shall advise the Centre on dealing with risks by issuing independent opinions on the quality of management and control systems and by issuing recommendations for improving the conditions of implementation of operations and promoting sound financial management.

The auditors shall be responsible for:

4.   The auditors shall perform their duties on all the Centre’s activities and units. They shall enjoy full and unlimited access to all information required to perform their duties.

5.   After the close of each financial year the auditors shall draw up a report by 30 June at the latest. This report shall be forwarded to the Director, who shall in turn forward it, with his comments if necessary, to the Executive Board. The Executive Board shall then forward the report to the Committee with its recommendations.

On the basis of this report and the financial statements, the Committee shall give the Director a discharge in respect of the implementation of the budget.

1.   The accounting officer and assistant accounting officers shall render themselves liable to disciplinary action and, where appropriate, to payment of compensation as regards payments made by them in violation of Article 19.

They shall render themselves liable to disciplinary action and to payment of compensation as regards any loss or damage of the monies, assets and documents in their keeping, where such loss or damage was caused intentionally or was the result of serious negligence on their part.

Under the same conditions, they shall be responsible for the correct execution of orders received by them in respect of the use and the administration of the bank accounts, and in particular:

2.   Imprest administrators shall render themselves liable to disciplinary action and, where appropriate, to payment of compensation in the following cases:

Imprest administrators shall be liable to disciplinary action and to payment of compensation in respect of any loss or damage of the monies, assets and documents in their keeping, where such loss or damage was caused intentionally or was the result of serious negligence on their part.

1.   The accounting officer, assistant accounting officers and imprest administrators shall be insured against the risks inherent in their respective duties.

The Centre shall cover the insurance costs relating thereto. It shall specify the categories of staff members serving as accounting officers, assistant accounting officers and imprest administrators, as well as the conditions subject to which it will cover the insurance costs borne by the said staff members to guard against the risks inherent in their respective duties.

2.   Special allowances shall be granted to the accounting officer, assistant accounting officers and imprest administrators. The level of these allowances shall be laid down in a regulation drawn up by the Centre. The amounts corresponding to these allowances shall be credited each month to an account opened by the Centre on behalf of each of these staff members in order to establish a guarantee fund for the purpose of covering any loss for which the person concerned might render himself liable, insofar as such a loss has not been covered by refunds from insurance companies.

The credit balance in these guarantee accounts shall be paid to the persons concerned after the end of their appointment as accounting officer, assistant accounting officer or impress administrator and after they have received the final discharge in respect of their management.

3.   The discharge to the accounting officer, assistant accounting officers and imprest administrators will be given by the Director, based on the external auditors’ report within two years after the closing of the financial year concerned.

1.   A permanent inventory shall be kept of all movable and immovable property belonging to the Centre. Only movable property whose value is EUR 350 or more shall be entered in the inventory. The inventory number shall be entered on each invoice before the latter is paid.

2.   Any sale of movable property and equipment of a unit purchase value in excess of EUR 1 000 shall be suitably advertised, in accordance with an internal directive to be drawn up by the Director.

3.   A record signed by both the Director and the person responsible for the equipment and certified by the internal control shall be drawn up whenever any property or article in the inventory is disposed of, scrapped or is found to be missing on account of loss or theft, or for any other reason.

4.   The Centre shall keep a physical and an accounting inventory, which shall be reconciled on a regular basis. This reconciliation shall be cleared by the internal control body.

1.   The Centre may also manage resources intended for the execution of activities laid down for it in the Agreement on behalf of third Parties. The list of these resources shall be given in an annex to the budget of the Centre.

2.   This Financial Regulation shall be applicable to the management of these resources.

However, the management of the other resources made available by the Commission shall be governed by the financial provisions laid down in the agreement signed by the Commission and the Centre. If there are no such provisions, this Financial Regulation shall remain applicable.

3.   Proper estimates of the expenses that will be financed by these resources shall also be annexed to the budget of the Centre. A clear distinction shall be made between operating and intervention expenses.

4.   Separate accounts shall be kept for the management of these resources on behalf of third Parties.

5.   The financial statements of each fund managed by the Centre on behalf of a third Party shall include a balance sheet and a revenue and expenditure account, indicating the situation as at 31 December of the financial year concerned. They shall be certified in accordance with the provisions of the agreement signed between the Centre and the donor.

If there are no such provisions, the certification shall be carried out by the financial control of the Centre.

6.   These financial statements shall be attached as an annex to the financial statements of the Centre.