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Document 52015TA1209(11)
Report on the annual accounts of the Executive Agency for Small and Medium-sized Enterprises for the financial year 2014, together with the Agency’s reply
Report on the annual accounts of the Executive Agency for Small and Medium-sized Enterprises for the financial year 2014, together with the Agency’s reply
Report on the annual accounts of the Executive Agency for Small and Medium-sized Enterprises for the financial year 2014, together with the Agency’s reply
IO C 409, 9.12.2015, p. 90–101
(BG, ES, CS, DA, DE, ET, EL, EN, FR, HR, IT, LV, LT, HU, MT, NL, PL, PT, RO, SK, SL, FI, SV)
9.12.2015 |
EN |
Official Journal of the European Union |
C 409/90 |
REPORT
on the annual accounts of the Executive Agency for Small and Medium-sized Enterprises for the financial year 2014, together with the Agency’s reply
(2015/C 409/11)
INTRODUCTION
1. |
The Executive Agency for Small and Medium-sized Enterprises (hereinafter ‘the Agency’, aka ‘EASME’), which is located in Brussels, replaced and succeeded the Executive Agency for Competitiveness and Innovation (EACI) and was established for the period 1 January 2014 to 31 December 2024 by Commission Implementing Decision 2013/771/EU (1), repealing Commission Decision 2007/372/EC (2). Its considerably extended mandate is to manage, in close cooperation with seven Directorates-General of the Commission, EU actions in the fields of research and innovation, competitiveness of SMEs, environment and climate action, maritime and fisheries, and also, as in the past, parts of the competitiveness and innovation programme 2007-2013. |
INFORMATION IN SUPPORT OF THE STATEMENT OF ASSURANCE
2. |
The audit approach taken by the Court comprises analytical audit procedures, direct testing of transactions and an assessment of key controls of the Agency’s supervisory and control systems. This is supplemented by evidence provided by the work of other auditors (where relevant) and an analysis of management representations. |
STATEMENT OF ASSURANCE
The management’s responsibility
The auditor’s responsibility
Opinion on the reliability of the accounts
Opinion on the legality and regularity of the transactions underlying the accounts
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10. |
The comments which follow do not call the Court’s opinions into question. |
COMMENTS ON BUDGETARY MANAGEMENT
11. |
The extent to which budget appropriations carried over from 2013 were cancelled in 2014 (2 60 209 euro, i.e. 20 % of carry-overs (19 % in 2013)) demonstrates an overestimation of budgetary needs at the end of 2013, as was the case in the previous year. |
12. |
Although the Agency’s initial budget was amended and reduced in September 2014 by 3 million euro, only 91 % of the reduced budget appropriations were committed by the Agency. This low implementation rate is mainly explained by organisational and operational challenges linked to the extended mandate of the Agency for the implementation of additional programmes and tasks in close cooperation with the Commission. Nonetheless, the significant under-consumption of the budget shows the need to improve the Agency’s budget planning. |
13. |
This is also reflected in the high and increased level of committed appropriations carried over to 2015, amounting to 3,8 million euro, i.e. 17 % (2013: 1,3 million euro, i.e. 8 %), mainly related to Title III (programme support expenditure) with 2,6 million euro, i.e. 72 % (2013: 0,6 million euro, i.e. 35 %) which is at odds with the budgetary principle of annuality. |
FOLLOW-UP OF PREVIOUS YEAR’S COMMENTS
14. |
An overview of the corrective actions taken in response to the Court's comments from the previous year is provided in Annex I. |
This Report was adopted by Chamber IV, headed by Mr Milan Martin CVIKL, Member of the Court of Auditors, in Luxembourg at its meeting of 8 September 2015.
For the Court of Auditors
Vítor Manuel da SILVA CALDEIRA
President
(1) OJ L 341, 18.12.2013, p. 73.
(2) OJ L 140, 1.6.2007, p. 52.
(3) These include the balance sheet and the statement of financial performance, the cash flow table, the statement of changes in net assets and a summary of the significant accounting policies and other explanatory notes.
(4) These comprise the budgetary outturn account and the annex to the budgetary outturn account.
(5) Articles 62 and 68 in conjunction with Articles 53 and 58 of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council (OJ L 298, 26.10.2012, p. 1).
(6) The accounting rules adopted by the Commission’s accounting officer are derived from the International Public Sector Accounting Standards (IPSAS) issued by the International Federation of Accountants or, where relevant, the International Accounting Standards (IAS)/International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board.
(7) Article 162 of Regulation (EU, Euratom) No 966/2012.
ANNEX I
Follow-up of previous year’s comments
Year |
Court's comment |
Status of corrective action (Completed/Ongoing/Outstanding/N/A) |
2013 |
Although budget implementation rates for 2013 were satisfactory, the extent to which appropriations carried over from 2012 were cancelled in 2013 (2 15 000 euro, or 19 % of carry-overs) indicates weaknesses in the Agency’s budget planning and is at odds with the budgetary principle of annuality. These cancellations are mainly related to provisional commitments made for routine administrative expenditure. |
Outstanding |
ANNEX II
Executive Agency for Small and Medium-sized Enterprises (Brussels)
Competences and activities
Areas of Union competence deriving from the Treaty on the Functioning of the European Union (TFEU) |
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Competences of the Agency (as defined in Commission Implementing Decision (2013/771/EU) |
Objectives The Agency is responsible for the management of Union actions in the fields of SME support, energy, environment, maritime and fisheries, entrepreneurship and innovation (including eco-innovation). It is entrusted with the implementation of parts of the following Union programmes:
In addition, the Agency is entrusted with the implementation of the legacy of the following actions under the CIP: (a) the ‘Intelligent energy Europe’ (IEE II); (b) the ‘Eco-innovation initiative’; (c) the ‘Enterprise Europe network’; (d) the ‘Your Europe business portal’; (e) the ‘European IPR helpdesk’; (f) the ‘IPorta project’. The Agency strives to provide ‘high-quality support to our beneficiaries, turning EU policy into action. As an executive agency of the European Commission, we manage significant parts of COSME, LIFE, Horizon 2020 and EMFF. We ensure that actions funded by these programmes deliver results and provide the Commission with valuable input for its policy tasks’. Tasks The Agency shall be responsible for the following tasks related to the implementation of the parts of the Union programmes referred to above:
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Governance |
Steering Committee Comprises five members and three observers appointed by the European Commission. It adopts the Agency’s annual work programme after approval by the European Commission. In addition, it adopts the administrative budget of the Agency and its annual activity report. Director Appointed by the European Commission. External audit European Court of Auditors. Discharge authority European Parliament, acting on a recommendation by the Council. |
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Resources made available to the Agency in 2014 (2013) |
Budget Operational budget The 1 056,5 (1) (242,9) million euro planned (of which 100 % came from the general budget of the EU) were committed and 123,11 (2) (213,9) million euro was paid of the appropriations (98,98 %) voted by the Budget Authority. The EASME implements the operational budget under the responsibility of the Commission:
Administrative budget 24,5(16,4) million euro (100 % EU subsidy) for the administrative budget, for which the EASME is independently responsible. Staff at 31 December 2014
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Products and services 2014 |
The year 2014 was the first year of the new mandate for the Agency which differs considerable from the previous mandates. The new portfolio includes the legacy programmes EIP and IEE and also the new programmes H2020, COSME, LIFE and EMFF. EASME is responsible for the management of Union actions in the fields of SME support, energy, environment, maritime and fisheries, entrepreneurship and innovation (including eco-innovation), under the following Union programmes. New programmes
Legacy programmes
COSME — the programme for the competitiveness of enterprises and small and medium-sized enterprises (SMEs) is associated with strengthening the competitiveness and sustainability of the Union’s enterprises and targeted towards encouraging an entrepreneurial culture to promote the creation and growth of SMEs. Key activities
Horizon 2020 — the EU’s funding programme for research and innovation aims to stimulate the economy and secure the science and technology base and industrial competitiveness for the future, contributing towards a smarter, more sustainable and more inclusive society. It promises more breakthroughs, discoveries and world-firsts by taking great ideas from the lab to the market. Innovation in SMEs Key activities
SME instrument Key activities
The Agency contributes to the specific objective of ‘Making the transition to a reliable, affordable, publicly accepted, sustainable and competitive energy system, aiming at reducing fossil fuel dependency in the face of increasingly scarce resources, increasing energy needs and climate change’ in Societal Challenge 3 ‘Secure, clean and efficient energy’. Key activities
The Agency contributes to DG RTD’s and DG GROW’s common specific objectives: to achieve a resource- and water-efficient and climate-change-resilient economy and society, the protection and sustainable management of natural resources and ecosystems, and a sustainable supply and use of raw materials, in order to meet the needs of a growing global population within the sustainable limits of the planet’s natural resources and eco-systems in Societal Challenge 5 ‘Climate action, environment and resource efficiency and raw materials’. Key activities
The Agency manages the programme for the Environment and Climate Action (LIFE) which provides support for reaching specific objectives related to environment policy and climate action at Union and international level. Key activities
The Agency implemented parts of the European Maritime and Fisheries Fund (EMFF), which aimed to contribute to promoting competitive, environmentally sustainable, economically viable and socially responsible fisheries and aquaculture and to enhancing the development and implementation of the EU integrated maritime policy (IMP). Key activities
Intelligent energy Europe (IEE) Key activities The ‘Intelligent energy Europe’ programme (IEE) supports the European Union’s energy policy and its ambitious ‘20-20-20’ commitment, i.e. reducing greenhouse gas emissions by 20 %, increasing the share of renewables in energy consumption to 20 %, and reducing energy use by 20 %, all by 2020.
Eco-innovation Key activities One of the key objectives of the entrepreneurship and innovation programme (EIP) is to support eco-innovation. Eco-innovation projects focus on cleaner production, environmental management and new products and services to make sustainable development become a business reality. In 2014 efforts were concentrated on:
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(1) Figure includes all credit lines.
(2) Idem.
Source: Annex supplied by the Agency.
THE AGENCY’S REPLY
11. |
The Agency reviews all the commitments at the end of each year. The year 2014 was an exceptional one as it was the first year of EASME’s new mandate. This transitional year included many changes such as a new operational structure, many organisational changes, new programmes and a significant increase in the number of staff employed by the Agency. A variety of new tasks were delegated to the Agency and this increase in tasks reflected also on the budget. A part of these budget appropriations was cancelled because the payments due were lower than expected. The main reasons were: variable costs in rent and maintenance of the building (due to the increase of office needs to accommodate the newly recruited staff), and unknown cost of additional services provided by OIB and DG HR. To rectify the situation, EASME is putting in place more precise budget planning and monitoring. |