The EU Court of Auditors approved all examined Joint Undertakings’ accounts this year, signalling their endorsement.
The European Court of Auditors (ECA) is the external auditor of the EU’s finances and is mandated to carry out an examination of the annual accounts and the underlying transactions for EU Joint Undertakings (JUs). JUs are partnerships between the EU, represented by the Commission and private partners from industry and research organisations. The primary mission of JUs is to foster the transformation of scientific knowledge into marketable innovations within a strategic vision that the partners share.
The ECA’s 2022 annual audit of the JUs’ annual accounts and underlying transactions was designed to address the key risks identified by the ECA in their risk assessment for 2022. Overall, the auditors have provided all the JUs with a clean bill of health, issuing unqualified (“clean”) audit opinions on the legality and regularity of the revenue underlying the annual accounts for the year 2022. The ECA finds that transactions were legal and regular in all material respects.
Having said that, the report also reveals areas that need improvement. First, while JUs are actively participating in new research and innovation programmes like Horizon Europe, Digital Europe, and CEF 2, various JUs are continuing numerous projects sanctioned in prior budgetary cycles. Since their lifespans were extended in subsequent budgetary cycles, these JUs are not bound by deadlines for executing projects funded in previous ones. Consequently, JUs that are impacted by this, like the Innovative Health Initiative or Chips JU, should establish a time-scheduled action plan for finalising the implementation of projects approved under previous budgetary cycles.
Second, for the Horizon 2020 programme, the JUs’ founding regulations set the contribution target per member category (EU, private members, Participating States, international organisations) to be provided for the JU-specific research and innovation activities under the programme. However, European High Performance Computing JU (EuroHPC) and Circular bio-based Europe JU (CBE) will not have achieved their private members’ contribution targets by the end of the Horizon 2020 programme implementation period. The ECA, therefore, recommends CBE and EuroHPC to monitor the private members’ individual contribution achievements annually, based on a strategic programme implementation plan.
Third, contributions to JUs’ research programmes vary significantly per member category (EU, private members, participating states). EU cash contributions are acknowledged upon payment at the project’s start, whereas other members’ (private members, participating states) in-kind and cash contributions are recognised after validating costs incurred in implemented projects. The ECA finds that the discrepancy between EU cash contributions and other members’ contributions was not adequately addressed in the JUs’ 2022 annual accounts due to the lack of information regarding the members’ legal commitments by year-end. Hence, the ECA recommends that JUs include in their annual accounts programme-specific details about members’ contributions to achieve transparency enhancement. This should encompass legal contribution targets, received contributions, and committed volumes for each member category by the year’s end across the programmes they function under. In conclusion, JUs have taken corrective action in response to the observations in the ECA’s specific annual reports from previous years and the auditors confirm the positive results of previous audits.