Supplementary Information from the European
Community Humanitarian Office (ECHO)
CONTROLS ON FUNDING FROM THE EUROPEAN COMMUNITY
HUMANITARIAN OFFICE (ECHO)
The financial management of ECHO is conceived
in order to fulfil, on the one hand, the requirements for speed
and efficiency of humanitarian operations in the field and, on
the other, the need for rigour in the management of the public
funds which are common to all of the Commission Services.
The flexibility granted in the administrative
procedures of ECHO's financial decisions does not in any way imply
that they are exempted or not very likely to be controlled internally
or externally.
I. THE DIFFERENT
CONTROLS TO
WHICH ECHO AND
ITS PARTNERS
ARE SUBMITTED
The humanitarian operations funded by the Humanitarian
Office are submitted to the following controls:
ECHO's internal control, in particular by the
Unit responsible for the management of financial resources;
"ex ante" control by Financial
Control of all decisions, engagements and payments (the last by
survey);
"ex post" controls by Financial
Control and the Court of Auditors (according to their programmes);
evaluations made on a regular basis by independent
consultants at the request of the Unit responsible for evaluation
inside ECHO.
Moreover, control reports on the way ECHO works
as well as on its financial management are regularly the subject
of extensive verifications, carried out at ECHO headquarters and/or
at field level such as:
— The report of the General Inspectorate
of Services of the Commission (issued in July 1995).
— The special report of the Court of
Auditors on the humanitarian aid provided between 1992 and 1995
(OJ 12 May 1997).
— The internal audit (systematic) report
for 1995 issued by the Financial Control in January 1997.
II. FRAMEWORK PARTNERSHIP
AGREEMENT
The European Community Humanitarian Office works
essentially through a Framework Partnership Agreement that sets
out the way in which Community funding is allocated. It also stipulates
the procedures that partners undertake to follow in order to report
on their actions, both from an operational and a financial point
of view. This system was adopted by the Commission and has been
positively valued by the Court of Auditors in its special report
of humanitarian aid between 1992 and 1995 (Official Journal of
12 May 1997). This Framework Partnership Agreement has been signed
by almost 200 partners (Humanitarian Agencies of the UN, the Red
Cross family and NGOs). It has enabled both quick and efficient
response to humanitarian emergency situations.
The Framework Partnership Agreement foresees:
That Partners submit financial and accounting
reports for each project funded by ECHO; and
That they keep receipts for a period of five
years for control and audit purposes by the Commission.
III. AUDITS OF
PARTNERS
The purpose of ECHO audits is as follows:
In general
To analyse and evaluate the financial and accounting
management systems and the internal control of our partners. The
analysis of management and control systems is undertaken by means
of several questionnaires, filled out during interviews with those
responsible and the members of the association. The replies are
then surveyed to ensure their conformity and the financial information
contained therein is verified. On the basis of the replies given
to these questionnaires, the audit team is able to assess the
level of control and the amount of risk in the financial field.
In particular
To control the appropriateness between original
receipts and the declarations of expenditure (financial reports)
submitted to ECHO by the partner. The methodology used is based
upon the verification, for every contract, of a sample of expenses,
each one of which should correspond to and entry in the accounting
system of the partner and should be justified by an invoice or
some other proof of expenditure.
In total, between December 1995 and October
1998, those responsible for audits within ECHO carried out a total
of 66 audits of partners. These audits were carried out on those
partners who have received 82 per cent of ECHO's operational funds,
including those relative to funding during the 1992 and 1995 period.
IV. THE EVALUATIONS
Since the end of 1993, ECHO has carried out
244 evaluations of humanitarian operations. One hundred and twenty-nine
of its partners (NGO and international organisations) have thus
been evaluated in almost every region of the world.
Throughout these evaluations, the implementation
of the humanitarian aid finance by ECHO is thoroughly analysed
as well as the manner in which the amounts allocated have been
used by our partners.
All of these evaluations have been carried out
by independent evaluators, in co-ordination with ECHO correspondents
and EC Delegations at field level.
V. THE INTERNAL
AUDIT REPORT
OF FINANCIAL
CONTROL
The appreciation of the Financial Control report
on ECHO, for 1995, was generally satisfactory. The report took
into account the specific "modis operandi" of ECHO that
consists of dispatching humanitarian and emergency aid through
its partners in accordance with the modalities foreseen in the
Framework Partnership Agreement (financial and operational reports
as well as the making available to the Commission of receipts
for the purpose of control over a period of five years).
The same audit report noted that, in the second
half of 1995, ECHO had started to carry out audits of its partners
that covered, evidently, projects funded during previous years.
VI. THE SPECIAL
REPORT OF
THE COURT
OF AUDITORS
ON HUMANITARIAN
AID
Mid 1994, the Court of Auditors undertook an
enquiry which aimed at appreciating the clarity of the humanitarian
aid policy of the European Union (its objective and the means
at its disposal), to examine the coherence and the complementary
of the various instruments in order to establish whether the Commission
had the means necessary for an effective implementation of its
aid and to verify procedures for reporting on the actions undertaken
and the results obtained.
The operations verified by the Court for the
period between 1992 and 1995 and the enquiry covered 134 humanitarian
aid projects for a total of 470 MECUs. This special report of
the Court of Auditors was published in the Official Journal of
12 May 1997 and, in point 1.17, the Court underlined that "whatever
the difficulties encountered during the 1992-95 period, namely
with regard to the qualitative appreciation of the impact of assistance,
it is necessary to bear in mind that the Commission has managed
to show, in particularly difficult areas due to the presence of
armed conflicts, an amount of assistance without precedent using
relatively limited means. The contribution of the European Union
to the actions of international solidarity remains a major credit
to be attributed to the Commission's Services. The creation of
ECHO has certainly helped in the accomplishment of this task".
ECHO
10 October 1998
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