30.12.2004 |
EN |
Official Journal of the European Union |
C 324/106 |
REPORT
on the annual accounts of the Office for Harmonization in the Internal Market for the 2003 financial year together with the Office's replies
(2004/C 0324/15)
CONTENTS
1 |
INTRODUCTION |
2-5 |
THE COURT'S OPINION |
6-10 |
OBSERVATIONS |
Tables 1–4
The Office's replies
INTRODUCTION
1. |
The Office for Harmonization in the Internal Market (hereinafter called ‘the Office’) was set up by Council Regulation (EC) No 40/94 (1) of 20 December 1993. Its mandate is to implement the Community legislation on trade marks and designs, which gives undertakings uniform protection throughout the area of the Union. The Office's duties and activities are summarised, on the basis of information submitted by the Office, in Table 1. |
THE COURT's OPINION
2. |
This opinion is addressed to the Office's Budget Committee pursuant to Article 137(2) of Council Regulation (EC) No 40/94 (). |
3. |
The Court has examined the Office's annual accounts for the financial ended 31 December 2003. In accordance with Article 119(2)(c) of Council Regulation (EC) No 40/94, the Office's budget was implemented on the responsibility of its President. This responsibility includes the drawing-up and presentation of the accounts (2), in accordance with the internal financial provisions provided for in Article 138 of Council Regulation (EC) No 40/94. The Court of Auditors is required under Article 248 of the Treaty establishing the European Community to examine these accounts. |
4. |
The Court carried out its audit in accordance with its audit policies and standards, which have been adapted from generally accepted international auditing standards to reflect the specific nature of the Community context. It examined the accounting documents and applied the audit procedures it considered necessary in that context. |
5. |
The Court has thus obtained reasonable assurance that the annual accounts for the financial year ended on 31 December 2003 are reliable and that the underlying transactions, taken as a whole, are legal and regular. The content of the following observations does not call into question the audit opinion expressed by the Court in this report. |
OBSERVATIONS
6. |
The implementation of the appropriations for the financial year 2003, and of the appropriations carried over from the previous year, is set out in Table 2. The Office's revenue and expenditure account and balance sheet for the financial year 2003 are presented in summary form in Tables 3 and 4. |
7. |
The total value of appropriations carried over was 18,3 million euro. More attention should be given to evaluating whether carry-overs are really necessary. Tests performed on a 35 % sample of this amount revealed unjustified carry-overs of around 586 000 euro, 350 000 euro for search reports and 236 000 euro for professional training activities. |
8. |
A large number of carry-overs correspond to provisional commitments, the unused balance of which is carried over at the year's end in its entirety, even where all or part of this balance does not relate to duly contracted obligations. This situation is irregular. |
9. |
Computer licences and software are not included under fixed assets, in contravention of the Regulation on inventory (3). As at 31 December 2003, it was estimated that they might have a value of up to 700 000 euro. |
10. |
In spite of the Court's previous observations (4), the Office has not reviewed its inventory system: duties are still poorly defined and there is still insufficient staff training. It is difficult to keep the inventory correctly in such circumstances. For example, items of computer equipment and furniture recorded in the accounts at a value of around 500 000 euro could not be located when a physical inventory was made. |
This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 29 and 30 September 2004.
For the Court of Auditors
Juan Manuel FABRA VALLÉS
President
(2) As required under Article 137(1) of Council Regulation (EC) No 40/94, the accounts of all the Office's revenue and expenditure for the 2003 financial year were drawn up on 28 February 2004 and sent to the Court of Auditors. They were received by the Court on 24 September 2004. A summarised version of these accounts is presented in the tables annexed to this report.
(3) Commission Regulation (EC) No 2909/2000 of 29 December 2000 (OJ L 336, 30.12.2000, p. 75).
(4) Paragraph 13 of the report on the financial year 2002 (OJ C 319, 30.12.2003, p. 84).
Table 1
Office for Harmonization in the Internal Market (Alicante)
Area of Community competence deriving from the Treaty |
Competence of the Office as specified in the Parliament and Council Regulation — Council Regulation (EC) No 40/94 of 20 December 1993 |
Governance |
Resources available to the Office in 2003 (2002 figures) |
Products and services supplied in 2003 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
Free movement of goods Prohibitions or restrictions justified on grounds of the protection of industrial and commercial property must not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. (From Article 30 of the Treaty) Restrictions on freedom to provide services within the Community are prohibited in respect of nationals of Member States who are established in a State of the Community other than that of the person for whom the services are intended. (From Article 49 of the Treaty) |
Objectives To implement the Community legislation on trade marks and designs, which gives undertakings the right to uniform protection throughout the area of the Union |
Tasks
|
|
Final budget 157 million euro (155 million euro). Community contribution: 0 % (0 %) Staff numbers as at 31 December 2003 Number of posts in establishment plan: 675 (675) Posts occupied: 650 (633) +31 (*) other staff (auxiliary contracts, seconded national experts, local employees, temporary replacements) Total staff: 681 (*) Assigned to the following duties:
(*): figures unavailable for 2002 |
Trade marks Number of applications: 57 637 Number of registrations: 34 290 Number of cases of opposition: 9 929 Number of cases settled: 9 396 Appeals to the Boards of Appeal: 719 Average time for registration (excluding opposition or appeal):
Designs Designs received: 37 084 Designs registered: 24 801 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Source:Information submitted by the Office. |
Table 2
Office for Harmonization in the Internal Market — Implementation of the budget for the 2003 financial year
(million euro) |
||||||||||||||||
Revenue |
Expenditure |
|||||||||||||||
Source of revenue |
Revenue entered in the final budget for the financial year |
Revenue received |
Allocation of expenditure |
Final budget appropriations |
Appropriations carried over from the previous financial year |
Appropriations available (2003 budget and 2002 financial year) |
||||||||||
entered |
committed |
paid |
carried over |
cancelled |
commitments outstanding |
paid |
cancelled |
appropriations |
committed |
paid |
carried over |
cancelled |
||||
Fees |
101,4 |
105,6 |
Title I Staff |
52,4 |
48,6 |
47,4 |
1,2 |
3,8 |
0,9 |
0,7 |
0,2 |
53,3 |
49,5 |
48,1 |
1,2 |
4,0 |
Other revenue |
4,3 |
4,9 |
Title II Administration |
26,1 |
24,3 |
16,4 |
7,9 |
1,8 |
9,7 |
9,3 |
0,4 |
35,8 |
34,0 |
25,7 |
7,9 |
2,2 |
Outturn for the previous financial year |
51,7 |
55,4 |
Title III Operating activities |
27,2 |
23,4 |
14,1 |
9,3 |
3,8 |
8,7 |
7,8 |
0,9 |
35,9 |
32,1 |
21,9 |
9,3 |
4,7 |
Title X Reserve |
51,7 |
0,0 |
0,0 |
0,0 |
51,7 |
0,0 |
0,0 |
0,0 |
51,7 |
0,0 |
0,0 |
0,0 |
51,7 |
|||
Total |
157,4 |
165,9 |
Total |
157,4 |
96,3 |
77,9 |
18,4 |
61,1 |
19,3 |
17,8 |
1,5 |
176,7 |
115,6 |
95,7 |
18,4 |
62,6 |
NB:Totals may include differences due to rounding Source:Office data — These tables summarise the data supplied by the Office in its own accounts. |
Table 3
Office for Harmonization in the Internal Market — Revenue and expenditure account for the financial years 2003 and 2002
(1000 euro) |
||
|
2003 |
2002 |
Revenue |
||
Own revenue |
107 056 |
97 329 |
Financial revenue |
3 460 |
3 141 |
Total revenue (a) |
110 516 |
100 470 |
Budgetary expenditure for the financial year |
||
Staff — Title I of the budget |
||
Payments |
47 416 |
46 106 |
Appropriations carried over |
1 168 |
934 |
Administration — Title II of the budget |
||
Payments |
16 366 |
15 095 |
Appropriations carried over |
7 891 |
9 718 |
Operating activities — Title III of the budget |
||
Payments |
14 137 |
16 431 |
Appropriations carried over |
9 262 |
8 651 |
Total expenditure (b) |
96 240 |
96 934 |
Outturn for the financial year (a – b) |
14 276 |
3 536 |
Other expenditure/provisions for the year |
||
Provision for procedural expenditure |
1 094 |
–1 363 |
Subtotal |
1 094 |
–1 363 |
Balance carried over from the previous financial year |
55 368 |
51 349 |
Appropriations carried over and cancelled |
1 506 |
1 817 |
Sums for re-use from the previous financial year not used |
115 |
11 |
Provision for procedural expenditure from previous financial years |
0 |
0 |
Exchange-rate differences and extraordinary revenue |
–6 |
17 |
Balance for the financial year |
72 353 |
55 368 |
NB:Totals may include differences due to rounding. Source:Office data — These tables summarise the data supplied by the Office in its own accounts. |
Table 4
Office for Harmonization in the Internal Market — Balance sheet as at 31 December 2003 and 31 December 2002
(1000 euro) |
|||||
Assets |
2003 |
2002 |
Liabilities |
2003 |
2002 |
Fixed assets |
|
|
Fixed capital |
|
|
Buildings |
26 747 |
26 286 |
Own capital |
27 921 |
28 065 |
Equipment and furniture |
3 828 |
3 783 |
Balance for the financial year |
72 353 |
55 368 |
Transport equipment |
115 |
111 |
Subtotal |
100 274 |
83 433 |
Computer equipment |
11 241 |
9 636 |
Long-term debt |
|
|
Intangible assets |
24 |
24 |
Long-term creditors |
24 |
23 |
Depreciation |
–14 035 |
–11 775 |
Subtotal |
24 |
23 |
Subtotal |
27 920 |
28 065 |
Current liabilities |
|
|
Current assets |
|
|
Automatic carry-overs of appropriations |
18 322 |
19 303 |
Suppliers and missions |
200 |
167 |
Advances from clients |
29 395 |
22 289 |
Other sundry accounts receivable |
107 |
89 |
Amounts outstanding |
51 |
14 |
Subtotal |
307 |
256 |
Sundry accounts payable |
757 |
664 |
Cash accounts |
|
|
Provision for procedural expenditure |
13 644 |
14 738 |
Bank accounts |
134 239 |
112 256 |
Subtotal |
62 169 |
57 008 |
Cash |
1 |
2 |
Suspense accounts |
|
|
Subtotal |
134 240 |
112 258 |
Revenue to be re-used |
0 |
115 |
|
|
|
Subtotal |
0 |
115 |
Total |
162 467 |
140 579 |
Total |
162 467 |
140 579 |
NB:Totals may include differences due to rounding. Source:Office data — These tables summarise the data supplied by the Office in its own accounts. |
THE OFFICE'SREPLIES
7. |
Concerning the search reports, the improvement in the computer application used to manage these reports, the abolition of the annual adjustment as from 1 January 2004 and the establishment of specific commitments for each of the national offices will help to better evaluate the appropriations to be carried over. For training, commitment requirements will be the subject of two examinations as from 2004, one in August and another in December. Amounts are already being decommitted as measures are being implemented. |
8. |
The Office has taken note of this observation and will take the necessary measures to reduce the carry-overs corresponding to provisional commitments. |
9. |
The Office will examine all the contracts concerned in order to determine the exact amount to be recorded as intangible assets in accordance with Commission Regulation (EC) No 2909/2000. |
10. |
Since 2003, the Office has been implementing measures to improve the keeping of its inventory, in particular by reorganising the inventory under a single department, aligning the headings with those of the Commission and reviewing the labelling and decommissioning of assets. Concerning the definition of duties and training, the Office is currently reviewing the Regulation on inventory and the underlying procedures and drawing up written instructions for physical inventory verification. |