Commission Implementing Regulation (EU) 2022/128 of 21 December 2021 laying down rules for the application of Regulation (EU) 2021/2116 of the European Parliament and of the Council on paying agencies and other bodies, financial management, clearance of accounts, checks, securities and transparency

COMMISSION IMPLEMENTING REGULATION (EU) 2022/128 of 21 December 2021 laying down rules for the application of Regulation (EU) 2021/2116 of the European Parliament and of the Council on paying agencies and other bodies, financial management, clearance of accounts, checks, securities and transparency

CHAPTER I

Paying agencies and other bodies

Article 1

Procedure for the accreditation of paying agencies

Member States shall designate an authority at ministerial level responsible for:

(a) the issuing, reviewing and withdrawing of accreditation of paying agencies;

(b) carrying out the tasks assigned to the competent authority pursuant to this Chapter.

The examination (pre-accreditation review) to be carried out by the audit body shall cover, in particular:

(a) the procedures and systems in place for the authorisation and execution of payments and for the execution of the annual performance reporting;

(b) the division of duties and the adequacy of internal and external control in respect of transactions financed by the European Agricultural Guarantee Fund (EAGF) and the European Agricultural Fund for Rural Development (EAFRD), hereinafter together referred to as ‘the Funds’;

(c) the extent to which the procedures and systems put in place are apt to safeguard the Union budget including risk-based anti-fraud measures;

(d) the security of information systems;

(e) the maintenance of accounting records.

The audit body shall prepare a report detailing the audit work carried out, the results of that work and its assessment as to whether the paying agency complies with the accreditation criteria. The report shall be provided to the competent authority which shall then assess the results and issue the accreditation act where it is satisfied that the paying agency complies with the accreditation criteria.

Pending the implementation of any necessary changes in order to fulfil such specific conditions, accreditation may be issued provisionally for a period to be determined taking into account the severity of the problems identified, which shall not exceed 12 months. In duly justified cases, the Commission may, upon request of the Member State concerned, grant an extension of that period.

The information provided for in Article 90(1), first subparagraph, point (a), of Regulation (EU) 2021/2116 shall be communicated immediately after the paying agency is first accredited and in any case before any expenditure effected by it is charged to the Funds. That information shall be accompanied by declarations and documents concerning:

(a) the responsibilities vested in the paying agency;

(b) the allocation of responsibilities between the departments of the paying agency;

(c) the relationship of the paying agency with other bodies, public or private, which are responsible for implementing any measures under which the paying agency charges expenditure to the Funds;

(d) the procedures by which claims by beneficiaries are received, verified, and validated, and by which expenditure is authorised, paid and accounted for;

(e) the provisions concerning the security of information systems;

(f) the report of the pre-accreditation review carried out by the audit body referred to in paragraph 3.

Article 2

Review and withdrawal of accreditation of paying agencies

Every 3 years, the competent authority shall report in writing to the Commission on its supervision of paying agencies and monitoring of their activities. The report shall include a review of the paying agencies’ continuous compliance with the accreditation criteria, together with a summary of the actions taken to remedy the deficiencies. The competent authority shall confirm whether a paying agency for which it is responsible continues to comply with the accreditation criteria.

Article 3

Procedure for issuing, reviewing and withdrawing the accreditation of the coordinating body

The communication of information provided for in Article 90, first subparagraph, point (a), of Regulation (EU) 2021/2116 shall be made immediately after the coordinating body is first accredited and, in any case, before any expenditure for which it is responsible is charged to the Funds. That information shall be accompanied by declarations and documents concerning:

(a) the responsibilities vested in the coordinating body;

(b) the allocation of responsibilities within the coordinating body;

(c) the relationship of the coordinating body with other bodies, public or private, which are responsible to collaborate with it on the performance of its tasks;

(d) the procedures and systems in place in place to ensure the performance of its tasks;

(e) the provisions concerning the security of information systems;

(f) the result of the examination on the compliance with the accreditation criteria referred to in paragraph 2.

Pending the implementation of any necessary changes in order to meet the accreditation criteria, accreditation may be:

(a) issued provisionally for a new coordinating body;

(b) put under probation for an existing coordinating body provided that an action plan is followed to remedy the situation.

The accreditation shall be withdrawn if the accreditation criteria have not been fulfilled and the competent authority considers that the coordinating body cannot fulfil its tasks.

Article 4

Management declarations

The management declarations shall be in the forms set out in Annexes I and II respectively to this Regulation and may be qualified by reservations quantifying the potential financial impact. In the event that reservations are expressed, the declaration shall include a remedial action plan and a precise a time frame for its implementation.

Article 5

Certification

Where there is more than one certification body in a Member State, that Member State may designate a public certification body at the national level to be responsible for coordination.

That opinion shall be based on the audit work to be carried out in accordance with Articles 6 and 7 of this Regulation.

The certification body shall draw up a report of its findings. The report shall also cover the delegated functions of the paying agency in accordance with Section 1.(D) of Annex I to Delegated Regulation (EU) 2022/127. The report shall state whether, for the period covered by the report:

(a) the paying agency complied with the accreditation criteria;

(b) the paying agency’s procedures were such as to give reasonable assurance that the expenditure charged to the Funds was effected in compliance with Union rules, thus ensuring that: (i) as regards the types of intervention referred to in Regulation (EU) 2021/2115, the expenditure has corresponding reported output and that it has been effected in accordance with the applicable governance systems, and that recommendations for improvements, if any, have been followed up; (ii) the underlying transactions were legal and regular, as regards the measures laid down in Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and Regulation (EU) No 1144/2014 of the European Parliament and of the Council (¹), as well as for the crop-specific payment for cotton and support for early retirement under Title III, Chapter II, Section 3, Subsection 2, and Article 155(2), respectively, of Regulation (EU) 2021/2115, and that recommendations for improvements, if any, have been followed up;

(c) the performance reporting on output indicators and the performance reporting on result indicators for the multiannual performance monitoring referred to in Article 134 of Regulation (EU) 2021/2115, demonstrating that Article 37 of Regulation (EU) 2021/2116 is complied with, was correct;

(d) the annual accounts referred to in Article 33 of this Regulation were kept in accordance with the books and records of the paying agency;

(e) the statements of expenditure and of public intervention operations were a materially true, complete and accurate record of the operations charged to the Funds;

(f) the financial interests of the Union were properly protected as regards advances paid, guarantees obtained, intervention stocks and amounts to be collected.

The report shall include information on the number and qualifications of staff conducting the audit, the work done, the systems examined, the level of materiality and confidence obtained where applicable, any weaknesses found and recommendations made for improvement and the operations of both the certification body and other audit bodies, internal and external to the paying agency, from which all or part of the certification body’s assurance on the matters reported was gained.

Article 6

Audit principles

This shall be done through system audit and compliance testing as regards the functioning of governance system, completeness and accuracy testing and analytical procedures for the performance reporting system.

As regards the audit of annual accounts substantive testing of expenditure shall be applied, including test of details. As regards the audit of the legality and regularity of the underlying transactions as referred to in the first subparagraph, the testing shall include verification on-the-spot.

The Commission shall establish guidelines, which contain, in particular:

(a) further clarification and guidance in respect of the certification audit to be performed;

(b) the determination of the reasonable level of audit assurance to be achieved from auditing.

Article 7

Audit methods

In the context of guarantee funds, the certification body may conduct audits of the bodies providing new underlying loans only when either one or both of the following situations occur:

(a) supporting documents, providing evidence of the support from the financial instrument to final recipients, are not available at the level of the managing authority or at the level of the bodies implementing the financial instrument;

(b) there is evidence that the documents available at the level of the managing authority or at the level of the bodies implementing the financial instrument do not represent a true and accurate record of the support provided.

The Member State shall define the arrangements to ensure the audit trail for financial instruments in accordance with the template set out in Annex III, demonstrating the fulfilment of conditions or achievement of results.

CHAPTER II

Financial management of the Funds

Section 1

General provisions

Article 8

Paying agencies’ accounts

Member States shall make available for the Commission the information of the expenditure effected and assigned revenue received on its request.

As regards the EAFRD, each paying agency shall keep accounts enabling all the operations for each plan and each intervention to be identified. Such accounts shall include in particular:

(a) the amount of public expenditure and the amount of the Union contribution paid for each operation;

(b) the amounts to be recovered from beneficiaries for irregularities or negligence found;

(c) the amounts recovered, with an indication of the original operation.

Section 2

EAGF accounts

Article 9

Establishment of the declaration of expenditure

Article 10

Communication of information by Member States

However, the communication on expenditure effected and assigned revenue received between 1 and 15 October shall be sent by 25 October at the latest.

All relevant information shall be provided on the basis of the model made available by the Commission to Member States through information systems.

The declaration of expenditure referred to in paragraph 1 shall consist of at least:

(a) a statement, drawn up by each paying agency, broken down according to the nomenclature of the Union budget and by expenditure and assigned revenue, based on a detailed nomenclature made available within the information systems to the Member States covering: (i) the expenditure effected and assigned revenue received during the preceding month; (ii) total expenditure effected and assigned revenue received from the beginning of the financial year until the end of the preceding month; (iii) estimates of expenditure and assigned revenue covering separately the next three months and, as appropriate, the total of estimates of expenditure and assigned revenue to the end of the financial year. Where the estimates for the next three months, as referred to in the first subparagraph, point (iii), fall in the next financial year, only the total per month needs to be provided;

(b) the accounts evidencing expenditure and revenue relating to public intervention.

Article 11

General rules on the declaration of expenditure and on assigned revenue

That expenditure and assigned revenue shall be entered in the accounts of the EAGF budget in respect of the corresponding financial year.

However:

(a) expenditure which may be paid prior to the implementation of the provision permitting it to be wholly or partially borne by the EAGF may be declared only: (i) in respect of the month during which the provision in question was implemented; or (ii) in respect of the month following implementation of that provision;

(b) revenue assigned to the EAGF shall be declared in respect of the month during which the time limit for payment of the corresponding amounts, laid down in Union legislation, expires. Where corrections to assigned revenue lead, at paying agency level, to the declaration of negative revenue assigned for a budget line, surplus corrections shall be carried over to the following month.

Where payments due under the EAGF are encumbered by claims, they shall be deemed to have been effected in their entirety for the purpose of applying paragraph 1:

(a) on the date of the payment of the sum due to the beneficiary, if the claim is less than the expenditure settled;

(b) on the date of set-off, if the expenditure is less than or equal to the claim.

Article 12

Special rules on declarations of expenditure relating to public storage

However:

(a) in the case of operations carried out in the course of September, the values and amounts shall be entered in the accounts by paying agencies by 15 October at the latest;

(b) in the case of the overall depreciation amounts referred to in Article 3(1), point (e), of Delegated Regulation (EU) No 906/2014, the amounts shall be entered in the accounts on the date laid down in the decision providing for them.

Article 13

Payment decision by the Commission

Article 14

Making resources available to Member States

By deciding to make the monthly payments, the Commission shall place at the disposal of the Member States, within the framework of the budget appropriations, the resources needed to cover expenditure to be financed by the EAGF, less the corresponding amount of assigned revenue, in the account opened by each Member State.

When the amount established by the Commission for the application of Article 13(1) is negative for a Member State in total or for a given budget line, the effective offsetting may be deferred to the following months.

Article 15

Communication under public intervention

Paying agencies shall transmit to the Commission:

(a) at the Commission’s request, the documents and information referred to in Article 3(7) of Delegated Regulation (EU) 2022/127 and the additional national administrative provisions adopted for the application and management of intervention measures;

(b) by the day provided for in Article 10(1), of this Regulation, the information on public storage, on the basis of the models made available by the Commission to Member States through information systems.

Article 16

Content of the public storage accounts to be kept by paying agencies

The stock accounts provided for in Article 3(3), first subparagraph, point (a), of Delegated Regulation (EU) 2022/127 shall contain the following categories of elements, shown separately:

(a) the quantities of products recorded on entry into and removal from storage, with or without physical movement;

(b) the quantities used for free distribution to the most deprived persons under the Fund for European Aid to the Most Deprived, and accounted for under Article 4(3) of Delegated Regulation (EU) No 906/2014, distinguishing those which are the subject of a transfer to another Member State;

(c) quantities taken as samples, distinguishing samples taken by purchasers;

(d) the quantities which, after checking by visual examination in the context of the annual stock-taking or during the inspection after taking into intervention, may no longer be repackaged and are the subject of direct sales;

(e) quantities missing, for identifiable or unidentifiable reasons, including those corresponding to the legal tolerance limits;

(f) quantities which have deteriorated;

(g) surplus quantities;

(h) missing quantities exceeding the tolerance limits;

(i) quantities which have entered into storage and been found not to meet the requirements and for which taking-over has therefore been refused;

(j) net quantities in storage at the end of each month or accounting year, which are carried forward to the next month or accounting year.

The financial accounts provided for in Article 3(3), first subparagraph, point (a), of Delegated Regulation (EU) 2022/127 shall contain:

(a) the value of the quantities referred to in paragraph 1, point (a), of this Article, showing separately the value of the quantities bought in and of the quantities sold;

(b) the book value of the quantities used or taken into account under the free distribution arrangements referred to in paragraph 1, point (b), of this Article;

(c) the financing costs referred to in Article 3(1), point (a), of Delegated Regulation (EU) No 906/2014;

(d) expenditure on physical operations as referred to in Article 3(1), points (b) and (c), of Delegated Regulation (EU) No 906/2014;

(e) amounts resulting from depreciation as referred to in Article 3(1), point (e), of Delegated Regulation (EU) No 906/2014;

(f) the amounts collected or recovered from sellers, purchasers and storers, other than those referred to in Article 21 of this Regulation;

(g) the amount from direct sales carried out after the annual stock-taking or following checks after products are taken into intervention storage;

(h) losses and gains on removals of products, taking account of depreciation as referred to in point (e) of this paragraph;

(i) other debits and credits, in particular those corresponding to the quantities referred to in paragraph 1, points (c) to (g), of this Article;

(j) the average book value, expressed per tonne.

Article 17

Accounting related to public intervention

The records and calculations referred to in paragraph 1 shall be made subject to the application of the following rules:

(a) the removal costs relating to quantities for which quantitative losses or deterioration have been recorded, in accordance with the rules laid down in Annexes VI and VII to Delegated Regulation (EU) No 906/2014, shall be entered in the accounts only for the quantities actually sold and removed from storage;

(b) quantities recorded as missing on transfer between Member States shall not be deemed to have entered storage in the Member State of destination and shall not be covered by standard entry costs;

(c) the standard entry and removal costs fixed for transport and transfer shall be entered in the accounts if those costs are not considered, under the Union rules, to be an integral part of the transport costs;

(d) unless specific Union rules provide otherwise, amounts accruing from sales of products which have deteriorated and any other amounts received in this context shall not be entered in the EAGF account records;

(e) any surplus quantities recorded shall be entered in the accounts as a negative amount, in the missing quantities in the stock situation and movements. Those quantities shall be included when determining the quantities exceeding the tolerance limit;

(f) samples other than those taken by purchasers shall be entered in the accounts in accordance with point 2(a) of Annex VII to Delegated Regulation (EU) No 906/2014.

Article 18

Dates for entering expenditure and revenue and product movements in the accounts for public intervention

However, the following dates shall apply in the cases set out below:

(a) the date of receipt, in the case of amounts received or recovered, as referred to in Article 16(2), points (f) and (g), of this Regulation;

(b) the date of actual payment of costs relating to physical operations, where such costs are not covered by standard amounts.

However, the following dates shall apply in the cases set out below:

(a) the date of taking-over of products by the paying agency, in accordance with Article 22(2) of Commission Implementing Regulation (EU) 2016/1240 (³), for quantities entering public storage without any change in the place of storage;

(b) regarding missing or deteriorated and surplus quantities, the date of the finding as to the facts in the case of missing or deteriorated and surplus quantities;

(c) the date of actual removal from storage, in the case of direct sales of products remaining in storage which can no longer be repackaged after visual examination in the context of the annual stock-taking or during the inspection after taking into intervention;

(d) the last day of the accounting year, for any losses exceeding the tolerance limit referred to in Article 4(2) of Delegated Regulation (EU) 2022/127.

Article 19

Amount financed under public intervention

Article 20

Declarations of public intervention expenditure and revenue

Section 3

EAFRD accounts

Article 21

Forecast of funding requirements

For each CAP Strategic Plan as referred to in Article 118 of Regulation (EU) 2021/2115, and in accordance with Article 90(1), first subparagraph, point (c)(ii), of Regulation (EU) 2021/2116, Member States shall send to the Commission, twice per year, by 31 January and 31 August at the latest, their forecasts of the amounts to be funded by the EAFRD for the financial year. In addition, Member States shall send an updated estimate of their funding requests for the following financial year.

Those forecasts and that updated estimate shall be sent on the basis of the model made available by the Commission to Member States through information systems.

Article 22

Declarations of expenditure

For each CAP Strategic Plan, paying agencies shall specify in a declaration of expenditure at least the following:

(a) the amount of eligible public expenditure, excluding additional national financing as referred to in Article 115(5) of Regulation (EU) 2021/2115, for which the paying agency has actually paid the corresponding EAFRD contribution during each of the reference periods referred to in paragraph 2 of this Article;

(b) the information on financial instruments as referred to in Article 32(4) and (5) of Regulation (EU) 2021/2116;

(c) the additional information on advances paid to beneficiaries as referred to in Article 44(3) of Regulation (EU) 2021/2116;

(d) the amount recovered during the current period as referred to in paragraph 2 of this Article, in respect of the CAP Strategic Plan;

(e) the amount recovered during the current period as referred to in paragraph 2 of this Article in respect of the EAFRD rural development programmes from 2007 onwards, for which Member States is no more obliged to send interim declaration of expenditure;

(f) the amounts related to technical assistance.

The expenditure effected and to be declared to the EAFRD shall take account of penalties applied in the framework of Member States’ management and control system in case of non-compliance.

Once the Commission has approved a CAP Strategic Plan, Member States shall send to the Commission, in accordance with Article 90(1), first subparagraph, point (c)(i), of Regulation (EU) 2021/2116, their declarations of expenditure by the following deadlines:

(a) by 30 April at the latest in the case of expenditure in the period 1 January to 31 March;

(b) by 31 July at the latest in the case of expenditure in the period 1 April to 30 June;

(c) by 10 November at the latest in the case of expenditure in the period 1 July to 15 October;

(d) by 31 January at the latest in the case of expenditure in the period 16 October to 31 December.

If in a Member State the CAP Strategic Plan is implemented by more than one paying agency, the coordinating body shall ensure that the declarations of expenditure are transmitted on the same day.

However, all expenditure paid by paying agencies to the beneficiaries in accordance with Article 86 of Regulation (EU) 2021/2115 until the end of the last period, as specified in the first subparagraph of this paragraph, prior to the approval of a CAP Strategic Plan as referred to in Article 118 of that Regulation, is made under the Member States’ responsibility and shall be declared to the Commission in the first declaration of expenditure following the approval of that plan. Recovered amounts for the corresponding period, as referred to in paragraph 1, second subparagraph, points (d) and (e), of this Article shall also be declared in that declaration. The same rule shall apply mutatis mutandis in case of amendment of a CAP Strategic Plan as referred to in Article 119 of Regulation (EU) 2021/2115, except for financing plan adjustments as referred to in Article 23 of this Regulation.

As regards financial instruments set up in accordance with Article 58 of Regulation (EU) 2021/1060 and Article 80 of Regulation (EU) 2021/2115, the expenditure shall be declared in the financial year when the conditions as referred to in Article 32(3) and (4) of Regulation (EU) 2021/2116 are met and it had been effected by the paying agency before the end of the financial year.

All the financial information required under this Article shall be communicated in euro.

Article 23

Calculation of the amount to be paid

The Union contribution to be paid in respect of the eligible public expenditure, excluding additional national financing as referred to in Article 115(5) of Regulation (EU) 2021/2115, shall be mentioned in the financing plan in force on the first day of the reference period and calculated as regards the CAP Strategic Plans referred to in Article 118 of that Regulation as follows:

(a) for each reference period referred to in Article 22(2) of this Regulation on the basis of the EAFRD contribution rate as provided for in Article 91 of Regulation (EU) 2021/2115 and approved by the Commission in accordance with Article 118 of that Regulation;

(b) for certain eligible types of expenditure, referred to in Article 155 of Regulation (EU) 2021/2115 in the period 2023–2027, on the basis of the contribution rate of the intervention set in the CAP Strategic Plan, subject to the conditions in that Article;

(c) technical assistance on the basis of a flat rate, as referred to in Article 94(2) of Regulation (EU) 2021/2115.

The calculation shall take account of the corrections to the Union contribution as declared in the declaration of expenditure for that period.

Article 24

Automatic decommitment

In case a Member State does not submit a revised financing plan, as provided for in Article 34(6) of Regulation (EU) 2021/2116, and the related amendment of the CAP Strategic Plan by 30 June, the Commission shall reduce the amounts allocated to each type of intervention pro rata, by amending the decision approving the Member State’s CAP Strategic Plan no later than 30 September.

Section 4

Common provisions for the Funds

Article 25

Electronic exchange of information and documents

The information systems referred to in paragraph 1 shall be able to process in particular:

(a) the data required for financial transactions, in particular those relating to the annual accounts of paying agencies, declarations of expenditure and assigned revenue and the transmission of information and documents referred to in Article 3 of Delegated Regulation (EU) 2022/127 and Articles 8, 10, 11, 12, 14, 18, 19, 21, 22, 23 and 32 of this Regulation;

(b) documents of common interest enabling the monthly and interim declarations of expenditure and annual accounts to be monitored and the information and documents which paying agencies must make available to the Commission to be consulted;

(c) the Union texts and Commission guidelines on the financing of the Common Agricultural Policy by authorities accredited and designated under Regulation (EU) 2021/2116, and the guidelines on the harmonised application of the relevant legislation.

Those models shall be adapted and updated by the Commission, after having informed the Committee on the Agricultural Funds.

Article 26

Requirements for the reimbursement of expenditure for the Funds

Article 27

Suspension of payments

The implementing acts determining the monthly payments referred to in Article 21(3) of Regulation (EU) 2021/2116 or the interim payments referred to in Article 32 of that Regulation shall take account of the suspension of payments decided in accordance with Articles 40(1) and (2), 41(2) and 42(2) of that Regulation.

Article 28

Action plans in relation to the multi-annual performance monitoring

Article 29

Action plans in relation to deficiencies in the governance systems

CHAPTER III

Clearance of accounts

Section 1

Recovery of debts

Article 30

Recovery of undue payments

Article 31

Recovery by offsetting

Without prejudice to any other enforcement action provided for by national law, Member States shall offset any undue amount arising from a pending irregularity of a beneficiary established in accordance with national law against any future payments in favour of that beneficiary, to be made by the paying agency responsible for the recovery of the debt.

Section 2

Clearance

Article 32

Content of the annual accounts

The annual accounts referred to in Article 90(1), first subparagraph, point (c)(iii), of Regulation (EU) 2021/2116 shall include:

(a) the assigned revenue referred to in Article 45 of that Regulation;

(b) the expenditure of the EAGF after deduction of any undue payments not recovered at the end of the financial year other than those referred to in point (f) of this paragraph, including any interests thereon, summarised by item and sub-item of the Union budget;

(c) the expenditure of the EAFRD, by programme, measure or type of intervention as applicable and specific contribution rate. The annual statement of expenditure shall also include information on the amounts recovered. Once a programme or CAP Strategic Plan is closed, any undue payments not recovered other than those referred to in point (f) of this paragraph, including any interests thereon, shall be deducted from the expenditure of the financial year in question;

(d) a table of differences by item and sub-item or, in the case of the EAFRD by programme, measure or by type of intervention as applicable and by specific contribution rate and focus area where applicable, between the expenditure and the assigned revenue declared in the annual accounts and that declared for the same period in the documents referred to in Article 10(2) of this Regulation, as far as the EAGF is concerned, and Article 22(2) of this Regulation, as far as the EAFRD is concerned, accompanied by an explanation for every difference;

(e) separately, the amounts to be borne by, respectively, the Member State concerned and the Union in accordance with Article 54(2), first subparagraph, and (3) of Regulation (EU) No 1306/2013 of the European Parliament and of the Council (⁵) in relation to: (i) expenditure incurred and payments made for support schemes under Regulation (EU) No 1307/2013 of the European Parliament and of the Council (⁶) in respect of calendar year 2022 and before; (ii) measures laid down in Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and (EU) No 1144/2014 until 31 December 2022; (iii) aid for operational programmes of recognised producer organisations or their associations in the fruit and vegetables sector and support programmes in the wine sector as referred to in Article 5(6) and (7), respectively, of Regulation (EU) 2021/2117 of the European Parliament and of the Council (⁷) in relation to expenditure incurred and payments made for operations implemented pursuant to Regulation (EU) No 1308/2013 after 31 December 2022 until the end of the operational programmes or the support programmes in accordance with Article 5(6)(c) and (7), respectively, of Regulation (EU) 2021/2117; (iv) revenue declared in the framework of the implementation of rural development programmes approved by the Commission pursuant to Regulation (EU) No 1305/2013, Council Regulation (EC) No 1698/2005 (⁸) and Commission Regulation (EC) No 27/2004 (⁹);

(f) an extract of the undue payments yet to be recovered at the end of the financial year as a consequence of irregularities within the meaning of Article 1(2) of Council Regulation (EC, Euratom) No 2988/95 (¹⁰), including any penalties provided for by the applicable sectoral Union rules and the interest thereon, to be presented in a table in accordance with the model set out in Annex V to this Regulation. For expenditure referred to point (e) of this paragraph, an extract of the undue payments shall be presented in a table in accordance with the model set out in Annex II to Implementing Regulation (EU) No 908/2014;

(g) an extract from the debtors ledger of the amounts to be recovered and credited to either the EAGF or the EAFRD other than those referred to in point (b), (c), (e) and (f) of this paragraph, including any penalties and interest thereon, to be presented in a table in accordance with the model set out in Annex III to Implementing Regulation (EU) No 908/2014 in respect of expenditure referred to in point (e) of this paragraph;

(h) a summary of intervention operations and a statement of the quantity and location of stocks at the end of the financial year;

(i) confirmation that expenditure, assigned revenue and the details of each movement of intervention storage is held on the paying agency’s files and accounting records;

(j) the closing balance at the end of the financial year of unused/un-cleared cumulated advances paid by Member States to beneficiaries, detailed for the EAGF by intervention and for the EAFRD by programme, or by type of intervention as applicable and for the latter, including the financial instruments. For the financial instruments, the closing balance concerns amounts paid as advances by the Commission in accordance with Article 32(4) point (a), of Regulation (EU) 2021/2116 that have neither been used by Member States for payments to or for the benefit of final recipients, nor have been committed for guarantee contracts or paid as management fees and costs in accordance with Article 80(5) of Regulation (EU) 2021/2115.

Article 33

Transmission of information

For the purpose of the clearance of accounts pursuant to Article 53 of Regulation (EU) 2021/2116, each Member State shall send to the Commission:

(a) the items included in the annual accounts, as referred to in Article 32 of this Regulation;

(b) the annual performance report referred to in Article 134 of Regulation (EU) 2021/2115;

(c) the opinion and reports established by the certification body or bodies, as referred to in Article 5(3) and (4) of this Regulation;

(d) the management declarations referred to in  Article 4 of this Regulation;

(e) an annual summary of the final audit reports and of controls carried out, including an analysis of the nature and extent of errors and weaknesses identified in systems, as well as corrective action taken or planned, as provided for in Article 63(5), point (b), of Regulation (EU, Euratom) 2018/1046 and Article 9(3), first subparagraph, point (c), of Regulation (EU) 2021/2116, submitted with the Paying Agency management declaration referred to in Article 3 of this Regulation.

Upon request by the Commission, the Member State shall provide the complete records of all the accounting information required for statistical and control purposes, related to expenditure as regards the measures laid down in Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and (EU) No 1144/2014.The form and content of the accounting information shall be specified by the Commission.

Those documents shall bear a compulsory electronic signature within the meaning of Regulation (EU) No 910/2014.

Article 34

Conservation of accounting information

Documents may only be kept exclusively in electronic form if the national law of the Member State concerned permits the use of electronic documents as evidence of the underlying transactions in national court proceedings.

If the documents are kept in electronic form only, the system for doing so shall comply with Section 3.(B) of Annex I to Delegated Regulation (EU) 2022/127.

Article 35

Financial clearance

For the EAFRD, the amount determined by the clearance of accounts decision shall include the funds which are re-usable by reallocation by the Member State concerned pursuant to Article 57 of Regulation (EU) 2021/2116.

As regards the EAFRD, the amount which, as a result of the clearance of accounts decision, is recoverable from or payable to each Member State shall be established by deducting the intermediate payments in respect of the financial year concerned from the expenditure recognised for the same year in accordance with paragraph 1.

The Commission shall deduct that amount from or add it to the first payment for which the declaration of expenditure is submitted by the Member State after the decision pursuant to Article 53 of Regulation (EU) 2021/2116 has been adopted.

Article 37

Conformity procedure

The Member State shall reply within 2 months of receipt of the communication. In its reply the Member State shall have the opportunity, in particular, to:

(a) demonstrate to the Commission that the actual extent of the non-compliance or the risk for the Funds is less than what was indicated by the Commission;

(b) inform the Commission of the corrective measures it has undertaken to ensure compliance with Union rules and the effective date of their implementation.

In justified cases, the Commission may, upon reasoned request of the Member State, authorise an extension of the 2-month period by a maximum of 2 months. The justified reason may be the certification body’s assessment of the Member State’s calculation. The request shall be addressed to the Commission before the expiry of that period.

If the Member State considers that a bilateral meeting is not required, it shall inform the Commission accordingly in its reply to the communication.

The Commission shall within 30 working days of the bilateral meeting draw up the minutes and send them to the Member State. The Member State may send its observations to the Commission within 15 working days after receipt of the minutes.

The Commission shall within 6 months after sending the minutes of the bilateral meeting formally communicate its conclusions to the Member State on the basis of the information received in the framework of the conformity procedure. That communication shall evaluate the expenditure to be excluded from Union financing under Article 55 of Regulation (EU) 2021/2116 and Articles 14 and 15 of Delegated Regulation (EU) 2022/127. The communication shall make reference to Article 43(1) of this Regulation.

If a Member State notifies the Commission that a bilateral meeting is not required, the 6-month period starts from the date of receipt by the Commission of the notification.

Where the Member State has made use of the conciliation procedure referred to in Article 43, the Commission shall communicate its conclusions to the Member State no later than 6 months after:

(a) the receipt of the conciliation body report; or

(b) the receipt of additional information from the Member State within the deadline referred to in Article 43(3), second subparagraph, provided that the conditions set out in paragraph 6 of this Article are met.

In order to apply paragraphs 3 and 4 within the respective time periods, the Commission shall have available all information relevant at that particular step of the procedure. Where the Commission deems it lacks information, it may at any time within the time periods set out in those paragraphs:

(a) ask for additional information from the Member State, to which the Member State shall reply within 2 months of receipt of the communication; and/or

(b) inform the Member State of its intention to carry out an additional audit mission to conduct the necessary verifications.

In that case, the time periods referred to in paragraphs 3 and 4 shall start again either on the receipt by the Commission of the requested additional information or from the last day of the additional audit mission.

Where the time periods referred to in paragraphs 2, 3 and 4 and in this paragraph include fully or partially the month of August, the running of those time periods will be suspended during that month.

When evaluating the expenditure to be excluded from Union financing, the information communicated by the Member State after the Commission’s formal communication referred to in paragraph 3, third subparagraph, may only be taken into account:

(a) where it is necessary to avoid the gross overestimation of the financial damage caused to the Union budget; and

(b) if the late transmission of the information is duly justified by external factors and does not jeopardise the timely adoption by the Commission of the decision pursuant to Article 55 of Regulation (EU) 2021/2116.

As regards the EAFRD, the deductions from Union financing shall be made by the Commission from the payment for which the declaration of expenditure is submitted by the Member State after the decision pursuant to Article 55 of Regulation (EU) 2021/2116 has been adopted.

However, at the Member State’s request and after consultation of the Committee on the Agricultural Funds, the Commission may adopt an implementing decision setting a different date for the deductions or authorising their reimbursement in not more than three instalments where this is warranted by the materiality of the deductions included in an implementing act adopted on the basis of Article 55 of Regulation (EU) 2021/2116. This request for instalments shall be submitted by the Member State to the Commission not later than 5 days after the consultation of the Committee on the Agricultural Funds on the decision pursuant to Article 55 of that Regulation.

The deferral decision shall authorise the deductions to be made after the end of the deferral period in three annual instalments. Where the total amount subject to the deferral decision represents more than 0,02 % of the Member State's gross domestic product, the Commission may authorise the reimbursement in maximum five annual instalments.

The Commission may decide, at the Member State's request and after consultation of the Committee on the Agricultural Funds, to extend once, for a period not exceeding 12 months, the time period of deferral referred to in the first subparagraph.

The Member State benefitting from a deferral decision shall ensure that the deficiencies which have been the reasons for the deductions and which persist at the time of adoption of the deferral decision are being remedied on the basis of an action plan, established in consultation with the Commission, including deadlines and clear progress indicators. The Commission shall amend or repeal the deferral decision, taking into account the principle of proportionality, in one of the following cases:

(a) the Member State fails to take the necessary actions to remedy the deficiencies as foreseen in the action plan;

(b) the progress of the remedial actions is not sufficient according to the progress indicators; or

(c) the outcome of the actions is not satisfactory.

Article 38

Decision not to start or pursue a conformity inquiry

Article 39

Conciliation body

For the purpose of the conformity procedure provided for in Article 55 of Regulation (EU) 2021/2116, a conciliation body shall be established. It shall perform the following tasks:

(a) to examine any matter referred to it by a Member State which has received a formal communication from the Commission pursuant to Article 37(3), third subparagraph, of this Regulation, including an evaluation of expenditure which the Commission intends to exclude from Union financing;

(b) to try to reconcile the divergent positions of the Commission and the Member State concerned;

(c) at the end of its examination, to draw up a report on the results of its reconciliation efforts, making any remarks it deems useful should all or some of the points of dispute remain unresolved.

Article 40

Composition of the conciliation body

They must be nationals of different Member States.

The terms of office may be renewed for a year at a time only, the Committee on the Agricultural Funds having been informed. However, if the chairperson to be appointed is already a member of the Conciliation Body, the initial term of office as chairperson shall be three years.

The names of the chairperson, the members and the substitute members shall be published in the C series of the Official Journal of the European Union.

In that case, the member concerned shall be replaced for the remainder of the period for which that member was appointed by a substitute member, the Committee on the Agricultural Funds being informed.

If the chairperson’s term of office is terminated, the member who is to perform the chairperson’s duties for the remainder of the period for which the chairperson was appointed shall be appointed by the Commission after consultation of the Committee on the Agricultural Funds.

Article 41

Independence of the conciliation body

The members shall not take part in the work of the conciliation body or sign a report if, in a previous office, they have been personally involved in the matter at issue.

Article 42

Working arrangements

The secretariat of the conciliation body shall be provided by the Commission.

The reports shall be signed by the chairperson and members who have taken part in the deliberations. They shall be co-signed by the secretariat.

Article 43

Conciliation procedure

A request for conciliation shall only be admissible where the amount envisaged to be excluded from the Union financing according to the Commission’s communication either:

(a) exceeds EUR 1 million; or

(b) represents at least 25 % of the Member State’s total annual expenditure under the budget items concerned.

In addition, if during the preceding discussions the Member State claimed and demonstrated that the matter is one of principle relating to the application of Union rules, the chairperson of the conciliation body may declare a request for conciliation to be admissible. However, such a request shall not be admissible if it relates solely to a matter of legal interpretation.

However, if the Member State considers it necessary to present in its request for conciliation information which has not yet been communicated to the Commission, the conciliation body may invite the Commission to assess that new information only if the conditions set out in Article 37(6) are met. The information shall be communicated to the Commission at the latest 2 months after the report referred to in Article 39, point (c), has been sent.

The report shall be sent to:

(a) the Member State concerned;

(b) the Commission, for examination before communicating its conclusions to the Member State;

(c) the other Member States in the framework of the Committee on the Agricultural Funds.

CHAPTER IV

Checks

Section 1

General rules

Article 44

Information to be collected on the identification of beneficiaries

Member States shall ensure that beneficiaries provide in the aid applications and payment claims the information necessary for their identification, including, where applicable, the identification of the group, as defined in Article 2(11) of Directive 2013/34/EU of the European Parliament and of the Council (¹³) in which they participate as of a certain date to be set by the Member State. That information shall include at least:

(a) name of the entity;

(b) VAT or tax identification number;

(c) name of the parent entity and VAT or tax identification number;

(d) ultimate parent and VAT or tax identification number;

(e) subsidiaries and VAT or tax identification numbers.

The information referred to in the first subparagraph may be used when drawing up the check sample referred to in Article 60(1), second subparagraph, of Regulation (EU) 2021/2116. The information may, in particular, be used to carry out checks as regards circumvention as referred to in Article 62 of that Regulation.

Article 45

Requirements for the data-mining tool

In order to make use on a voluntary basis of the data-mining tool referred to in Article 59(2) of Regulation (EU) 2021/2116 to be made available by the Commission for the checks under Article 60 of that Regulation, Member States shall ensure that:

(a) the management and control systems, including the integrated administration and control system referred to in Article 65(1) of Regulation (EU) 2021/2116, can be linked electronically to the tool and, in order to minimise the administrative burden and manual intervention, the exchange of data shall be automatic and in machine-readable format;

(b) the information and the checks performed with the data-mining tool can automatically fed back to the management and control systems, and can be recorded and stored there.

Section 2

Scrutiny of transactions

Article 46

Scrutiny by Member States

Article 47

Mutual assistance

Member States shall send a request for mutual assistance referred to in Article 79 of Regulation (EU) 2021/2116 to each Member State in which an undertaking as referred to in that Article is established. The request shall contain all the details necessary to enable the Member State of destination to identify the undertakings and to undertake its scrutiny obligations. The Member State of destination shall be responsible for the scrutiny of such undertakings in accordance with Article 77 of that Regulation.

Article 48

Annual control plans and reports

CHAPTER V

Securities

Section 1

Scope, information technology, force majeure

Article 49

Scope

This Chapter shall apply in all cases where the agricultural legislation provides for a security, whether or not the particular term ‘security’ is used.

This Chapter shall not apply to securities lodged to ensure payment of import and export duties referred to in Regulation (EU) No 952/2013 of the European Parliament and of the Council (¹⁴).

Article 50

e-Administration

Communications, documents and securities may be produced, processed, and managed by using IT systems on condition that the systems applicable are managed under the officially approved quality and security protocols fit for those systems.

If competent authorities cannot access required documents for verification because of differences in IT systems, those documents shall be printed out and certified as genuine by the authority competent for the management of those IT systems (‘the issuing authority’) or by an authority competent for certifying documents as genuine copies.

Such print-outs may be replaced by an electronic message between the issuing authority and the beneficiary or the competent authority, on condition that the issuing authority provides in an officially approved certification protocol ensuring the genuineness of the message.

Article 51

Force majeure time limits

Section 2

Form of securities

Article 52

Form

A security may be given:

(a) as a cash deposit as referred to in Article 20(2) and (3) of Delegated Regulation (EU) 2022/127; and/or

(b) by providing a guarantor in accordance with Article 22 of Delegated Regulation (EU) 2022/127.

At the discretion of the competent authority, a security may be given by:

(a) pledging cash deposits in a bank;

(b) pledging recognised claims against a public body or public funds, which are due and payable and against which no other claim has precedence; and/or

(c) pledging collateral negotiable in the Member State concerned provided they are issued or guaranteed by that Member State.

Article 53

Negotiable collateral

Article 54

Replacement and assignment

However, the agreement of the competent authority shall be required in the following cases:

(a) where the original security has been forfeited but not yet realised; or

(b) where the replacement security is of a type listed in Article 52(2).

Section 3

Release and forfeiture

Article 55

Partial release

Where specific Union rules do not specify a minimum quantity, the competent authority may itself restrict the number of partial releases of any one security and may specify a minimum sum for any such release.

Before releasing all or part of a security the competent authority may require that a written request for release be provided.

In the case of securities covering more than 100 % of the sum required to be secured, that part of the security exceeding 100 % shall be released when the remainder of the sum secured is finally released or forfeited.

Article 56

Forfeiture

Where payment has not been made at the end of that period, the competent authority shall:

(a) without delay clear any security of the type described in Article 52(1), point (a), to the appropriate account;

(b) without delay require the guarantor referred to in Article 52(1), point (b), to pay, allowing up to 30 days from the day of receipt of demand for payment;

(c) without delay take steps to: (i) convert the securities described in Article 52(2), points (b) and (c), into money sufficient to recover the sum due; (ii) clear pledged cash deposits referred to in Article 52(2), point (a), to its own account.

The competent authority may without delay clear any security of the type described in Article 52(1), point (a), to the appropriate account without first requiring the person concerned to effect payment.

Without prejudice to paragraph 1:

(a) where the decision to forfeit a security is taken but on appeal is subsequently postponed in accordance with national law, the party concerned shall pay interest on the sum actually forfeited over the period starting 30 days from the day of receipt of the demand for payment as referred to in paragraph 1 and ending on the day prior to the payment of the sum actually forfeited;

(b) where following the outcome of the appeal procedure the party concerned is asked to pay within 30 days the sum forfeited, for the purpose of calculating interest the Member State may consider payment to be made on the 20th day following the date of such request;

(c) the rate of interest applicable is calculated in accordance with national law, but shall in no case be lower than the interest rate applicable in case of recovery of national amounts;

(d) paying agencies shall deduct the interest paid from EAGF or EAFRD expenditure in accordance with Regulation (EU) 2021/2116;

(e) Member States may claim periodically an increase of the security in respect of the interest involved.

Section 4

Information

Article 57

Information on securities forfeiture, types of securities and guarantors

Member States shall keep at the Commission’s disposal a list of:

(a) the types of institutions authorised to act as guarantors and the requirements laid down in that respect;

(b) the types of security accepted pursuant to Article 52(2) and the requirements laid down in that respect.

CHAPTER VI

Transparency

Article 58

Form and way of presentation

Article 59

Publication of beneficiaries in case of small amounts

Article 60

Date of publication

The information referred to in this Chapter shall be published by 31 May each year for the preceding financial year.

Article 61

Information to the beneficiary

The information to the beneficiaries referred to in Article 99 of Regulation (EU) 2021/2116 shall be provided by including it in the application forms for receiving support from the EAGF or the EAFRD, or otherwise at the time when the data are collected.

Article 62

Cooperation between the Commission and Member States

CHAPTER VII

Data for WTO notification of domestic support

Article 63

Data and transmission

CHAPTER VIII

Final provisions

Article 64

Repeal

Implementing Regulation (EU) No 908/2014 is repealed with effect from 1 January 2023.

However:

(a) Article 2, Article 3(1), first subparagraph, Article 3(2), Article 4(1), point (b), Articles 5, 6 and 7, Articles 21 to 25, Articles 27, 28 and 29, Article 30(1), points (a), (b) and (c), Article 30(2), (3) and (4), and Articles 31 to 40 of that Implementing Regulation shall continue to apply: (i) in relation to expenditure incurred and payments made for support schemes under Regulation (EU) No 1307/2013 in respect of the calendar year 2022 and before; (ii) for measures implemented until 31 December 2022 under Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and (EU) No 1144/2014; (iii) for the aid schemes referred to in Article 5(6), first subparagraph, point (c), and Article 5(7) of Regulation (EU) 2021/2117 in relation to expenditure incurred and payments made for operations implemented pursuant to Regulation (EU) No 1308/2013 after 31 December 2022 and until the end of those aid schemes; and (iv) as regards the EAFRD, in relation to expenditure incurred by the beneficiaries and payments made by the paying agency in the framework of the implementation of rural development programmes pursuant to Regulation (EU) No 1305/2013;

(b) Articles 57 and 59 of that Implementing Regulation shall continue to apply to all payments made on the basis of Regulation (EU) No 1306/2013 for all the financial years up to and including 2022;

(c) Annexes II and III to that Regulation shall continue to apply for the purposes of Article 32, points (f) and (g), of this Regulation.

Article 65

Entry into force and application

This Regulation shall enter into force on the seventh day following that of its publication in the Official Journal of the European Union.

It shall apply from 1 January 2023.

However:

(a) Articles 9, 10 and 11 shall apply to expenditure incurred and assigned revenue received by Member States from 16 October 2022;

(b) Article 22(1), second subparagraph, point (e), shall apply in respect of the assigned revenue recovered from 1 January 2026 for the rural development programmes approved by the Commission pursuant to Regulation (EU) No 1305/2013;

(c) Article 60 shall apply from financial year 2023.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

ANNEX I

I, …, Director of the … Paying Agency, present the accounts for this Paying Agency for the financial year 16/10/xx to 15/10/xx+1.

I declare, based on my own judgement and on the information at my disposal, including, inter alia, the results of work of the internal audit service, that:

— the accounts presented give, to the best of my knowledge, a true, complete and accurate view of the expenditure and receipts for the financial year referred to above. In particular, all debts, advances, guarantees and stocks known to me have been recorded in the accounts, and all receipts collected relating to the EAGF and the EAFRD have been properly credited to the appropriate funds;

— I have put in place a system which provides reasonable assurance: (i) that payments are legal and regular in relation to expenditure incurred and payments made for support schemes under Regulation (EU) No 1307/2013 in respect of the calendar year 2022 and before; as regards the measures laid down in Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and (EU) No 1144/2014; for aid schemes referred to in Article 5(6), first subparagraph, point (c), and Article 5(7) of Regulation (EU) 2021/2117 of the European Parliament and of the Council in relation to expenditure incurred and payments made for operations implemented pursuant to Regulation (EU) No 1308/2013 after 31 December 2022 and until the end of those aid schemes; and as regards the EAFRD, in relation to expenditure incurred by the beneficiaries and payments made by the paying agency in the framework of the implementation of rural development programmes pursuant to Regulation (EU) No 1305/2013; (ii) that the governance systems as referred to in Article 9(3), first subparagraph, point (d)(ii), of Regulation (EU) 2021/2116 are functioning properly and ensure that the expenditure was made in accordance with Article 37 of that Regulation; (iii) on the quality and reliability of the reporting system and of data on indicator as regards types of interventions referred to in Regulation (EU) 2021/2115 and that the expenditure matches the corresponding reported output and that it has been effected in accordance with the applicable governance systems.

The expenditure entered in the accounts was used for its intended purpose, as defined in Regulation (EU) 2021/2116.

Furthermore, I confirm that effective and proportionate anti-fraud measures under Article 59 of Regulation (EU) 2021/2116 are in place and take account of the risks identified.

That assurance is, however, subject to the following reservations:

Finally, I confirm that I am not aware of any undisclosed matter which could be damaging to the financial interest of the Union.

Signature

ANNEX II

I, …, Director of the … Coordinating Body, present the annual performance report for … (Member State) for the financial year 16/10/xx to 15/10/xx+1.

I declare, based on my own judgement and on the information at my disposal, including, inter alia, the results of the work of the certification body, that:

— the annual performance report referred to in Article 134 of Regulation (EU) 2021/2115 has been compiled following the accredited procedure and systems in place at the coordinating body and based on the certified data provided by the paying agencies (…list) in … (Member State).

That assurance is, however, subject to the following reservations:

Finally, I confirm that I am not aware of any undisclosed matter, which could be damaging to the financial interest of the Union.

Signature

ANNEX III

1.documents on the establishment of the financial instrument, such as funding agreements, etc.;

2.documents identifying the amounts contributed by the CAP Strategic Plan and under each type of intervention to the financial instrument, the expenditure that is eligible under the CAP Strategic Plan and the interest and other gains generated by support from the EAFRD and re-use of resources attributable to the EAFRD in accordance with Articles 60 and 62 of Regulation (EU) 2021/1060;

3.documents on the functioning of the financial instrument, including those related to monitoring, reporting and control;

4.documents concerning exits of CAP Strategic Plan contributions and the winding-up of the financial instrument;

5.documents on the management costs and fees;

6.application forms, or equivalent, submitted by final recipients with supporting documents, including business plans and, when relevant, previous annual accounts;

7.checklists and reports from the bodies implementing the financial instrument;

8.declarations made in connection with de minimis aid, when applicable;

9.agreements signed in connection with the support provided by the financial instrument, including for equity, loans, guarantees or other forms of investment provided to final recipients;

10.evidence that the support provided through the financial instrument is to be used for its intended purpose;

11.records of the financial flows between the paying agency and the financial instrument, and within the financial instrument at all levels, down to the final recipients, and, for guarantees, proof that underlying loans were disbursed;

12.separate records or accounting codes for a CAP Strategic Plan contribution paid or a guarantee committed by the financial instrument for the benefit of the final recipient.

ANNEX IV

1. Introduction

1.1.Identification of the external audit firm that has been involved in preparing the report.

1.2.Reference period (16 October N-1 to 15 October N).

1.3.Identification of the financial instrument(s)/mandate(s) and CAP Strategic Plan(s) covered by the audit report. Identification of the funding agreement to which the report relates to (the ‘Funding agreement’).

2. Audit of internal control systems applied by the EIB/EIF or other international financial institutions

Results of the external audit of the internal control system of the EIB or other international financial institutions (IFIs), in which a Member State is a shareholder, assessing the set-up and effectiveness of this internal control system and covering the following elements:

2.1. Mandate acceptance process.

2.2. Process for the appraisal and selection of financial intermediaries: formal and quality assessment.

2.3. Process for the approval of transactions with financial intermediaries and signature of relevant funding agreements.

2.4. Processes for the monitoring of financial intermediaries relating to: 2.4.1. reporting by financial intermediaries; 2.4.2. maintenance of records; 2.4.3. disbursements to final recipients; 2.4.4. eligibility of support to final recipients; 2.4.5. management fees and costs charged by the financial intermediaries; 2.4.6. visibility, transparency and communication requirements; 2.4.7. implementation of State aid and cumulation of aid requirements by the financial intermediaries; 2.4.8. differentiated treatment of investors, where relevant; 2.4.9. compliance with applicable Union law related to money laundering, terrorism financing, tax avoidance, tax fraud or tax evasion.

2.5. Systems for the processing of payments received from the paying agency.

2.6. Systems for the calculation and payment of amounts related to management costs and fees.

2.7. Systems for the processing of payments to financial intermediaries.

2.8. Systems for the processing of interest and other gains generated by support from the CAP Strategic Plan(s) to financial instruments.

2.9. For the annual audit report concerning the final accounting year information on the following elements shall be covered in addition to those of points 2.1 to 2.8: 2.9.1. Use of differentiated treatment of investors; 2.9.2. Achieved multiplier ratio compared to the agreed multiplier ratio in the guarantee agreements for financial instruments delivering guarantees; 2.9.3. Use of interest and other gains attributable to the support from the CAP Strategic Plan paid to financial instruments in line with Article 60 of Regulation (EU) 2021/1060; 2.9.4. Use of resources paid back to financial instruments, which are attributable to the support from the EAFRD, until the end of the eligibility period and arrangements put in place for the use of those resources after the end of the eligibility period in line with Article 62 of Regulation (EU) 2021/1060.

For points 2.1, 2.2 and 2.3, following the submission of the first annual audit report, only information on updates or changes to the procedures or arrangements in place need to be provided.

3. Audit conclusions

3.1.Conclusion as to whether the external audit firm can provide reasonable assurance on the set-up and effectiveness of the internal control system put in place by the EIB or other IFIs, in which a Member State is a shareholder, in accordance with the applicable rules, as per the elements referred to in section 2.

3.2.Findings and recommendations resulting from the audit work carried out.

Points 3.1 and 3.2 shall be based on the results of the audit work referred to in section 2 and where relevant, take account of the results of other national or Union audit work carried out in relation to the same body implementing financial instruments and/or to the same mandate for financial instruments.

ANNEX V

The information referred to in Article 32(1), point (f), shall be provided per paying agency by using the following table:

a	b	c	d	e	f	g	h	i	j
Paying Agency	Fund	Currency unit	Balance 15 October N-1	Total ‘new cases’ (financial year N)	Total ‘corrections’ (financial year N)	Total ‘interests’ (financial year N)	Total ‘recoveries’ (financial year N)	Total ‘irrecoverable’ amounts (year N)	Amount for which recovery is ongoing (Balance 15 October N)

ANNEX VI

Control plan for scrutiny as referred to in Article 80(1) of Regulation (EU) 2021/2116 and Article 48 of this Regulation

PROPOSED CONTROL PLAN FOR THE SCRUTINY PERIOD …

A description shall be provided of the procedure to be applied in order to select the undertakings to be scrutinised.

Furthermore, a clear indication shall be made on the use of the risk analysis specifying if such procedure is complemented by random and/or manual selection.

In addition, an explanation shall be provided on how the different sectors/measures and regions will be covered in the selection of the undertakings.

Where risk analysis shall be applied, information shall be provided on all risk factors taken into consideration and the subsequent possible values assigned to those risk factors. That information shall be included in the tables provided below.

Where appropriate, a description shall be provided of the procedure to be applied to weight the risk factors.

Risk factors and risk values applicable to all sectors/measures subject to risk analysis	Weighting of risk factors
Risk factors	Risk values
Description	Values
Specific risk factors and risk values applicable to … (sector/measure)	Weighting of risk factors
---	---	---	---
Risk factors	Risk values
Description	Values

Where applicable, additional boxes for risk factors and risk values to sector/measures shall be added.

Information shall be provided on how the results of the risk analysis and the adopted procedures led to the selection of undertakings into the final scrutiny control plan.

Sectors/measures to be excluded shall be clearly identified and the reasons for exclusion shall be described.

Reasons to select undertakings whose receipts or payments, or the sum thereof, were less than EUR 40 000 , shall be provided.

Population from which the selection is made:
(C) Total number
(D) Total number whose receipts or payments, or the sum thereof, were exceeding EUR 350 000
(E) Total number whose receipts or payments, or the sum thereof, were EUR 350 000 or less, but not less than EUR 40 000
(F) Total number whose receipts or payments, or the sum thereof, were less than EUR 40 000
Undertakings proposed for scrutiny:
(G) Total number
(H) Total based upon risk analysis (*1)
(I) Total number whose receipts or payments, or the sum thereof, were exceeding EUR 350 000
(J) Total number whose receipts or payments, or the sum thereof, were EUR 350 000 or less, but not less than EUR 40 000
(K) Total number whose receipts or payments, or the sum thereof, were less than EUR 40 000
(1) Undertakings in this category include only those selected through risk analysis and exclude those added randomly and/or manually to the control plan no subject to risk analysis. Note on table:*
(A) EAGF Budget Item No	(B) EAGF Budget Article
---	---
Totals:
Note on table: Where applicable, additional rows shall be added.

ANNEX VII

Scrutiny report as referred to in Article 80(2), point (B) of Regulation (EU) 2021/2116 and Article 48 of this Regulation

REPORT FOR THE SCRUTINY PERIOD …

(A) The total number of undertakings to be scrutinised:
(B) The total number of undertakings scrutinised:
(C) The total number of undertakings in the course of scrutiny:
(D) The total number of undertakings not yet scrutinised
(A) EAGF Budget Item No	(B) EAGF Budget Article
---	---
(D) Expenditure actually scrutinised (EUR)*	(E) Total expenditure related to those undertakings (EUR)
Totals:
Notes on table: *  Relates only to the expenditure of the invoices that have been effectively scrutinised (which are those selected for verification and/or cross-checked). Where applicable, additional rows shall be added.
(A) EAGF Budget Article	(B) EAGF Budget Item N.
---	---
Totals:
Notes on table: *  For preceding scrutiny periods, only those not reported in previous reports. Each undertaking with irregularity(ies) should be reported in a separate line. Where applicable, additional rows are to be added.
Execution of scrutinies relating to preceding scrutiny control plans	(A) Number of undertakings
---	---
4.1.  Undertakings declared in previous report as in the course of scrutiny (4.1 = 4.2+ 4.3)
4.2.  Undertakings in 4.1 for which scrutinies have been completed
4.3.  Undertakings in 4.1 for which scrutinies are still in course
4.4.  Undertakings for which scrutinies in previous report were declared as not started (4.4 = 4.5+4.6+4.7)
4.5.  Undertakings in 4.4 for which scrutinies have been completed
4.6.  Undertakings in 4.4 for which scrutinies are still in course
4.7.  Undertakings in 4.4 for which scrutinies have not been started
Notes on table: *  Relates only to the expenditure of the invoices that has been effectively scrutinised (those selected for verification and/or cross-checked).

A summary of mutual assistance requests made and received under Title IV, Chapter III, of Regulation (EU) 2021/2116, shall be provided.

Information on the requests sent and the replies received shall be included in the tables provided below:

(A) Member State to whom request has been sent	(B) Date of request	(C) Date of reply and a summary of the results
Note on table: Where applicable, additional rows shall be added.

The number of staff, expressed in person/years, allocated to scrutinies, per control body and, where appropriate, per region shall be provided.

Information shall be provided on any difficulties encountered in the application of Title IV, Chapter III, of Regulation (EU) 2021/2116 and the measures taken to overcome them or proposals to that end.

Where appropriate, suggestions shall be made for the improvement of the application of Title IV, Chapter III, of Regulation (EU) 2021/2116.

ANNEX VIII

Name of the beneficiary/Legal entity/association	Surname of beneficiary	If belonging to a group, name of the parent entity and VAT or Tax identification number	Municipality	Code of the measure/type of intervention/sector as set in Annex IX	Specific objective (1)	Start date (2)	End date (3)	Amount by operation under EAGF	Total of EAGF amount for that beneficiary	Amount by operation under EAFRD	Total of EAFRD amount for that beneficiary	Amount by operation under co-financing	Total of co-financed amount for that beneficiary	Total of EAFRD and co-financed amounts	Total of the EU amount and co-financed amount for that beneficiary
									50		70		40	110	160
				Code A				20
				Code B						40		25
				Code C				30
				Code D						30		15
(1) The specific objective of the operation shall correspond to one or more objectives set in the relevant Union legislation governing the operation concerned as described in Annex IX. In particular, the specific objective(s) of an operation under Regulation (EU) 2021/2115 shall correspond to the specific objectives laid down in Article 6 thereof and be consistent with the CAP Plan of the Member State. Furthermore, the specific objective(s) of an operation under Regulations (EU) No 1305/2013, (EU) No 1307/2013 and (EU) No 1308/2013 shall correspond to the objectives laid down in Article 110(2) of Regulation (EU) No 1306/2013 (for further guidance Member States may refer to the Technical Handbook on the Monitoring and Evaluation Framework of the Common Agricultural Policy 2014 – 2020). (2) The information on the start date of the types of intervention in the form of direct payments, the types of interventions for rural development interventions with regard to natural or other area-specific constraints and to area-specific disadvantages resulting from certain mandatory requirements as well as of the measures under Regulations (EU) No 228/2013 and (EU) No 229/2013 is not relevant as those measures and types of intervention operations are annual. (3) The information on the end date of the types of interventions in the form of direct payments, the types of intervention for rural development interventions with regard to natural or other area-specific constraints and to area-specific disadvantages resulting from certain mandatory requirements as well as of the measures under Regulations (EU) No 228/2013 and (EU) No 229/2013 is not relevant as those measures and types of intervention operations are annual. (4) For the publication of the following information: (a) expenditure incurred and payments made for support schemes under Regulation (EU) No 1307/2013 in respect of the calendar year 2022 and before; (b) for measures implemented under Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and (EU) No 1144/2014 until 31 December 2022; (c) for the aid schemes referred to in Article 5(6), first subparagraph, point (c), and Article 5(7) of Regulation (EU) 2021/2117 in relation to expenditure incurred and payments made for operations implemented pursuant to Regulation (EU) No 1308/2013 after 31 December 2022 and until the end of those aid schemes; and (d) payments made by the paying agency in the framework of the implementation of rural development programmes pursuant to Regulation (EU) No 1305/2013; only the information prescribed in Article 111 of Regulation (EU) No 1306/2013 shall be published in this table, the other columns shall be left blank or marked with N/A.

ANNEX IX