The paying agency’s organisational structure shall allow it to execute the following main functions in respect of EAGF and EAFRD expenditure:
Authorisation and control of payments to establish that the amount to be paid to a beneficiary is in conformity with Union rules, which shall include, in particular, administrative and on-the-spot controls;
Execution of payments of the authorised amount to beneficiaries (or their assignees) or, in the case of rural development, the Union co-financing part;
Accounting to record all payments in the paying agency’s separate accounts for EAGF and EAFRD expenditure, in the form of an information system, and the preparation of periodic summaries of expenditure, including the monthly (for EAGF), quarterly (for EAFRD) and annual declarations to the Commission. The paying agency’s accounts shall also record the assets financed by the Funds, in particular concerning intervention stocks, uncleared advances, securities and debtors.
The paying agency’s organisational structure shall provide for clear assignment of authority and responsibility at all operational levels and for separation of the three functions referred to in the first paragraph, the responsibilities of which shall be defined in an organisational chart. It shall include the technical services and the internal audit service referred to under point 4.
The agency shall ensure that:
Appropriate human resources are allocated to carry out operations and existence of appropriate technical skills as required at different operational levels.
The division of duties is such that no official has responsibility for more than one of the responsibilities for authorising, paying or accounting of sums charged to the EAGF or to the EAFRD, and no official performs any of those tasks without the supervision of a second official.
The responsibilities of each official are defined in a written job description, including the setting of financial limits to his/her authority.
Staff training is appropriate at all operational levels, including fraud awareness, and there is a policy for rotating staff in sensitive positions, or alternatively for increased supervision.
Appropriate measures are taken to avoid a conflict of interests where a person occupying a position of responsibility or a sensitive position with regard to the verification, authorisation, payment and accounting of claims or payment request also fulfils other functions outside the paying agency.
A written agreement must be concluded between the paying agency and that body specifying, apart from the delegated tasks, the nature of the information and the supporting documents to be submitted to the paying agency and the time limit within which they must be submitted. The agreement must enable the paying agency to comply with the accreditation criteria.
The paying agency shall in all cases remain responsible for the efficient management of the Funds concerned. It remains fully responsible for the legality and regularity of the underlying transactions, including protecting the Union’s financial interest, as well as for declaring the corresponding expenditure to the Commission and for preparing the accounts accordingly.
The responsibilities and obligations of the other body, notably concerning the control and verification of the compliance with Union rules, shall be clearly defined.
The paying agency shall ensure that the other body has effective systems for ensuring that it fulfils its tasks in a satisfactory manner.
The other body shall explicitly confirm to the paying agency that it in fact fulfils its tasks and shall describe the means employed.
The paying agency shall regularly review the tasks delegated to confirm that the work performed is of satisfactory standard and that it is in compliance with Union rules.
The paying agency shall adopt the following procedures:
The paying agency shall lay down detailed procedures for the receipt, recording and processing of claims, including a description of all documents to be used.
Each official responsible for authorisation shall have at his/her disposal a detailed checklist of the verifications to be carried out, and shall attest in the supporting documents of the claim that those checks have been carried out. That attestation may be made by electronic means. There shall be evidence of systematic, such as sample, system or plan based review of the work by a senior staff member.
A claim shall be authorised for payment only after sufficient checks have been carried out to ensure compliance with Union rules.
The checks shall include those required by the relevant Regulation governing the specific measure under which aid is claimed, and those required pursuant to Article 58 of Regulation (EU) No 1306/2013 to prevent and detect fraud and irregularity with particular regard to the risks incurred. For the EAFRD, there shall in addition be procedures for verifying that the conditions for the granting of aid, including contracting, have been respected and that all applicable Union and national rules, including those fixed in the rural development program, have been complied with.
The management of the paying agency shall, at an appropriate level, be informed on a regular and timely basis of the results of administrative and on-the-spot checks carried out, so that the sufficiency of those controls may always be taken into account before a claim is settled.
The work performed shall be detailed in a report accompanying each claim, batch of claims or, if appropriate, in a report covering one marketing year. The report shall be accompanied by an attestation of the eligibility of the approved claims and of the nature, scope and limits of the work done. In addition, for the EAFRD there shall be an assurance that the criteria for the granting of aid, including contracting, have been respected and that all applicable Union and national rules, including those fixed in the rural development program, have been complied with. If any physical or administrative checks are not exhaustive, but performed on a sample of claims, the claims selected shall be identified, the sampling method described, the results of all inspections and the measures taken in respect of discrepancies and irregularities reported upon. The supporting documents shall be sufficient to provide assurance that all the required checks on the eligibility of the authorised claims have been performed.
Where documents (in paper or electronic form) relating to the claims authorised and controls made are retained by other bodies, both those bodies and the paying agency shall set up procedures to ensure that the location of all such documents relevant to specific payments is recorded.
The paying agency shall adopt the necessary procedures to ensure that payments are made only to bank accounts belonging either to beneficiaries or to their assignees. The payment shall be made by the paying agency’s bank, or, as appropriate, a governmental payments office, within five working days of the date of charge to the EAGF or to the EAFRD. Procedures shall be adopted to ensure that all payments for which transfers are not executed are not declared to the Funds for reimbursement. If such payments have already been declared to the Funds these should be re-credited to the Funds via the next monthly/quarterly declarations or in the annual accounts at the latest. No payments shall be made in cash. The approval of the authorising official and/or his/her supervisor may be made by electronic means, provided an appropriate level of security over those means is ensured, and the identity of the signatory is entered into the electronic records.
The paying agency shall adopt the following procedures:
Accounting procedures shall ensure that monthly (for EAGF), quarterly (for the EAFRD) and annual declarations are complete, accurate and timely, and that any errors or omissions are detected and corrected, in particular through checks and reconciliations performed at regular intervals.
The accounting for intervention storage shall ensure that the quantities and associated costs are correctly and promptly processed and recorded per identifiable lot and in the correct account at each stage from the acceptance of an offer to the physical disposal of the product, in compliance with the applicable regulations, and ensure that the quantity and nature of stocks at every location may be determined at any time.
Procedures shall be adopted to ensure that:
Payments of advances are separately identified in the accounting or subsidiary records.
Guarantees are obtained only from financial institutions which fulfil the conditions of Chapter IV of this Regulation and which are approved by the appropriate authorities and which remain valid until cleared or called upon, on the simple request of the paying agency.
The advances are cleared within the stipulated time limits and those overdue for clearing are promptly identified and the guarantees promptly called upon.
All the criteria provided for in points (A) to (D) shall apply, mutatis mutandis, to levies, forfeited guarantees, reimbursed payments, assigned revenues etc. which the paying agency is required to collect on behalf of the EAGF and of the EAFRD.
The paying agency shall set up a system for the recognition of all amounts due and for the recording in a single debtor’s ledger of all such debts prior to their receipt. The debtor’s ledger shall be inspected at regular intervals and action shall be taken to collect debts that are overdue.
The information regarding documentary evidence of the authorisation, accounting and payment of claims and handling of advances, securities and debts shall be available in the paying agency to ensure at all times a sufficiently detailed audit trail.
The paying agency shall adopt the necessary procedures to ensure that every change in the Union’s regulations, and in particular the rates of aid applicable, are recorded and the instructions, databases and checklists updated in good time.
International Standards Organisation 27002: Code of practice for Information Security controls (ISO);
Bundesamt für Sicherheit in der Informationstechnik: IT-Grundschutzhandbuch/IT Baseline Protection Manual (BSI);
Information Systems Audit and Control Association: Control objectives for Information and related Technology (COBIT).
The Commission may authorise Member States to certify their information systems security in accordance with other accepted standards if those standards guarantee a level of security at least equivalent to that provided by ISO 27001.
For paying agencies responsible for the management and control of a yearly expenditure not higher than EUR 400 million, the Member State may decide not to apply the provisions of the first subparagraph. Those Member States shall continue to apply the provisions of point (i). They shall inform the Commission of their decision.
The internal control activities shall cover at least the following areas:
Monitoring of the technical services and delegated bodies responsible for carrying out the controls and other functions to ensure a proper implementation of regulations, guidelines and procedures.
Initiating of system changes in order to improve control systems in general.
Reviewing claims and requests submitted to the paying agency as well as other information providing suspicion of irregularities.
Monitoring procedures to prevent and detect fraud and irregularity with particular regard to those areas of CAP expenditure under the paying agency’s competence which are exposed to a significant risk of fraud or other serious irregularities.
Ongoing monitoring is built into the normal, recurring operating activities of the paying agency. At all levels the daily operations and controls activities of the agency shall be monitored on an ongoing basis to ensure a sufficiently detailed audit trail.
The paying agency shall adopt in this respect the following procedures:
The internal audit service shall be independent of the paying agency’s other departments and shall report directly to the paying agency’s director.
The internal audit service shall verify that procedures adopted by the agency are adequate to ensure that compliance with Union rules is verified and that the accounts are accurate, complete and timely. Verifications may be limited to selected measures and to samples of transactions provided that an audit plan ensures that all significant areas, including the departments responsible for authorisation, are covered over a period not exceeding five years.
The internal audit service’s work shall be performed in accordance with internationally accepted standards, shall be recorded in working papers and shall result in reports and recommendations addressed to the agency’s top management.
Each storage point shall be inspected at least once every year in accordance with the rules set out in point B, to ascertain in particular:
the procedure for collecting information on public storage;
whether the accounting data held on the spot by the storer tallies with the information sent to the paying agency;
the physical presence in the store of the quantities mentioned in the storer’s accounting records and which served as a basis for the latest monthly statement provided by the storer, assessed visually or, in case of doubt or dispute, by weighing or measuring;
the sound, fair and marketable quality of the products stored.
Physical presence shall be established by a sufficiently representative physical inspection, covering at least the percentages set out in point B and making it possible to conclude that the entire quantities listed in the stock accounts are actually present.
Checks on quality shall comprise visual, olfactory and/or organoleptic checks and, if there are any doubts, in-depth analyses.
If an anomaly is detected during the physical inspection, a further percentage of the quantities in intervention storage shall be inspected using the same method. If necessary, inspection may extend to weighing all the products in the lot or store being inspected.
the name of the storer, the address of the store visited and the description of the lots inspected;
the date and time when the inspection began and ended;
the place where the inspection took place and a description of the conditions of storage, packaging and accessibility;
the full identity of the persons conducting the inspection, their status and the terms of their authorisation;
the inspection measures undertaken and procedures used to establish volume, such as measuring methods, calculations, interim and final results, and the conclusions drawn;
for each lot or quality stored, the quantity in the paying agency’s books, the quantity in the store’s books and any discrepancies between the two sets of books;
for each lot or quality physically inspected, the information referred to in point (f) and the quantity verified on the spot and any discrepancies, the lot or quality number, the pallets, boxes, silos, vats or other receptacles involved and the weight (both net and gross if appropriate) or volume;
the statements made by the storer where there are discrepancies or differences;
the place, date and signature of the person drawing up the report and of the storer or representative;
any extended inspection conducted in the case of anomalies, specifying the percentage of the stored quantities covered by the extended inspection, discrepancies found and explanations given.
Immediately after receipt of the report, the paying agency’s accounts shall be corrected in the light of the discrepancies and differences detected.
the checks carried out, clearly indicating which are physical inspections (inventory checks),
the quantities checked,
the anomalies detected in relation to the monthly and annual statements, and the reasons for those anomalies.
The quantities checked and the anomalies detected shall be indicated for each product concerned, in terms of weight or volume and as a percentage of the total quantities held.
This summary document shall list separately the checks to verify the quality of the products stored. It shall be sent to the Commission at the same time as the annual accounts referred to in Article 7(3)(a) of Regulation (EU) No 1306/2013.
identifying the control numbers of the lots and boxes on the basis of purchase or entry notes,
weighing the pallets (one in 10) and the boxes (one per pallet),
visually checking the contents of a box (one in five pallets),
checking the condition of the packaging.
identifying the control numbers of the lots and bags on the basis of purchase or entry notes,
weighing the pallets (one in 10) and bags (one in 10),
visually checking the contents of a bag (one in five pallets),
checking the condition of the packaging.
Selection shall be based on the paying agency’s stock records, but the storer shall not be informed.
verification of the presence of cereals or rice in the selected bins or storerooms,
identification of the cereals or rice,
inspection of storage conditions and check on the quality of the products stored in the conditions provided for in Regulation (EU) No 1272/2009(1),
comparison of the place of storage and identity of the cereals or rice with the store’s records,
evaluation of the quantities stored by a method previously approved by the paying agency, a description of which shall be lodged at its head office.
The cereals or rice shall be stored in such a way that their volume may be verified.
Some tolerance is permitted when verifying the volume.
The rules laid down in Annex III, point II shall thus apply where the weight of the products stored as recorded during the physical inspection differs from the book weight by 5 % or more for cereals and for rice in the case of storage in silos or on-floor storage.
Where cereals or rice are stored in a warehouse, the quantities weighed on entry into storage may be recorded instead of those resulting from a volume assessment if the latter does not provide an adequate degree of accuracy and provided the difference between the two figures is not excessive.
The paying agency shall make use of this option where justified by circumstances, on a case-by-case basis and on its own responsibility. It shall indicate that it has done so in its inspection report, based on the following model:
CEREALS — STOCK INSPECTION
| Product: | Storer: Store, silo:Cell number: | Date: |
|---|---|---|
| Lot | Quantity stated in stock accounts | |
| Chamber No | Volume stated in specification m3 (A) | Free volume recorded m3 (B) | Volume of stored cereals m3 (A-B) | Specific gravity recorded kg/hl = 100 | Weight of cereals or rice |
|---|---|---|---|---|---|
Total (A): …
| Storeroom No | Storeroom No | Storeroom No | ||||
|---|---|---|---|---|---|---|
| Area covered … Height … | … m2 … … … m | … … m3 … | … m2 … … … m | … … m3 … | … m2 … … … m | … … m3 … |
| Corrections … | … m3 | … m3 | … m3 | |||
| Volume … | … m3 | … m3 | … m3 | |||
| Specific gravity … | … kg/hl | … kg/hl | … kg/hl | |||
| Total weight | … tonnes | … tonnes | … tonnes | |||
Total (B): …
Total weight in the store: …
Difference from book weight: …
In %: …
…, [date]
… (Stamp and signature)
Paying agency inspector:
identifying the lots and pallets and verifying the number of boxes,
checking the weight of 10 % of the pallets or containers,
checking the weight of 10 % of the boxes from each pallet weighed,
visually checking the contents of the boxes and the condition of the packaging in each box.
The pallets shall be chosen having regard to the different cuts in store.
Storers shall be responsible for ensuring that the products covered by Union intervention measures are properly conserved. They shall bear the financial consequences of any failure to do so.
Where the quality of intervention products in storage deteriorates as a result of poor or inappropriate storage conditions, the losses shall be borne by the storer and entered in the public storage accounts as a loss resulting from deterioration of the product due to storage conditions.
The tolerance limits provided for in Annex II, points B. III(2) shall apply without prejudice to the other tolerances referred to in the first subparagraph.
place of storage (with identification of the bin or vat where relevant),
quantity carried over from the previous month,
entries and removals by lot,
stock at the end of the period.
These documents shall permit precise identification of the quantities in store at any time, and shall take account of purchases and sales that have been agreed but for which the corresponding entries or removals of stock have not yet occurred.
| Products: | Storer:Store: No:Address: | Month: | |||
|---|---|---|---|---|---|
| Lot | Description | Quantity (kg, tonnes, hl, boxes, items, etc.) | Date | Comments | |
| Entry | Exit | ||||
| Quantity carried over | |||||
| Quantity to be carried over | |||||
(Stamp and signature)
Place and date:
Name:
It shall be made available to storers in electronic form by the paying agencies.
| Products: | Storer:Store: No:Address: | Year: | |
|---|---|---|---|
| Lot | Description | Quantity and/or weight booked | Comments |
(Stamp and signature)
Place and date:
Name:
Public storage contracts concluded between the paying agency and the storer shall contain provisions which make it possible to guarantee compliance with Union legislation.
They shall require the following:
the keeping of computerised intervention stock accounts;
direct, immediate availability of a permanent inventory;
availability at all times of all the documents relating to the entry, storage and removal of stock and the accounting documents and records drawn up under this Regulation and held by the storer;
permanent access to those documents for staff of the paying agency and the Commission, and for any person duly authorised by them.
The form and content of the documents referred to in points 1 and 2 of paragraph III shall be established in accordance with Article 104 of Regulation (EU) No 1306/2013.
Supporting documents relating to all public storage operations shall be kept by the storer for the full period required under the rules adopted based on Article 104 of Regulation (EU) No 1306/2013 for the clearance of accounts procedures, without prejudice to the relevant national provisions.
cereals 0,2 %
paddy rice, maize 0,4 %
skimmed-milk powder 0,0 %
butter 0,0 %
beef and veal 0,6 %
These tolerances shall apply during the physical stock inspections. They shall be calculated, for each product, on the basis of all the quantities stored by a paying agency.
The actual weight at entry and removal shall be the recorded weight minus the standard packaging weight, as laid down in the conditions of entry or, where no such conditions have been laid down, minus the average packaging weight used by the agency.
Commission Regulation (EU) No 1272/2009 of 11 December 2009 laying down common detailed rules for the implementation of Council Regulation (EC) No 1234/2007 as regards buying-in and selling of agricultural products under public intervention (OJ L 349, 29.12.2009, p. 1).
Commission Regulation (EU) No 65/2011 of 27 January 2011 laying down detailed rules for the implementation of Council Regulation (EC) No 1698/2005, as regards the implementation of control procedures as well as cross-compliance in respect of rural development support measures (OJ L 25, 28.1.2011, p. 8).