title: 2006/888/EC: Decision of the European Central Bank of 10 November 2006 on the annual accounts of the European Central Bank (ECB/2006/17)

text:
               11.12.2006

               EN

               Official Journal of the European Union

               L 348/38

      DECISION OF THE EUROPEAN CENTRAL BANK

   of 10 November 2006
   on the annual accounts of the European Central Bank
   (ECB/2006/17)
   (2006/888/EC)
   THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK,
   Having regard to the Statute of the European System of Central Banks and of the European Central Bank, and in particular to Article 26.2 thereof,
   Whereas:

               (1)

               Decision ECB/2002/11 of 5 December 2002 on the annual accounts of the European Central Bank (1) (ECB) requires significant amendment. From 1 January 2007 the European System of Central Banks (ESCB) will use the economic approach as defined in Guideline ECB/2006/16 of 10 November 2006 on the legal framework for accounting and financial reporting in the European System of Central Banks (2) to record foreign exchange transactions, financial instruments denominated in foreign currency and related accruals. It is desirable for reasons of clarity to recast the Decision in a single text.

               (2)

               Decisions ECB/2002/11, ECB/2005/12 and ECB/2006/3 which are replaced by this Decision should be repealed,

         HAS DECIDED AS FOLLOWS:
   CHAPTER I
   GENERAL PROVISIONS
   Article 1
   Definitions
   1.   For the purposes of this Decision, ‘Eurosystem’ and ‘national central banks’ (NCBs) shall have the same meaning as in Article 1 of Guideline ECB/2006/16.
   2.   Other technical terms used in this Decision shall have the same meaning as in Annex II to Guideline ECB/2006/16.
   Article 2
   Scope of application
   The rules set out in this Decision shall apply to the annual accounts of the ECB comprising the balance sheet, items recorded in the books of the ECB off-balance sheet, the profit and loss account and the notes to the annual accounts of the ECB.
   Article 3
   Basic accounting assumptions
   The basic accounting assumptions defined in Article 3 of Guideline ECB/2006/16 shall also apply for the purposes of this Decision.
   Article 4
   Recognition of assets and liabilities
   A financial or other asset/liability shall only be recognised in the balance sheet of the ECB in accordance with Article 4 of Guideline ECB/2006/16.
   Article 5
   Economic and cash/settlement approaches
   Article 5 of Guideline ECB/2006/16 shall apply to this Decision.
   CHAPTER II
   COMPOSITION AND VALUATION RULES FOR THE BALANCE SHEET
   Article 6
   Composition of the balance sheet
   The composition of the balance sheet shall be based on the structure set out in Annex I.
   Article 7
   Provision for foreign exchange rate, interest rate and gold price risks
   Taking into due consideration the nature of the ECB's activities, the Governing Council may establish a provision for foreign exchange rate, interest rate and gold price risks in the balance sheet of the ECB. The Governing Council shall decide on the size and use of the provision on the basis of a reasoned estimate of the ECB's risk exposures.
   Article 8
   Balance sheet valuation rules
   1.   Current market rates and prices shall be used for balance sheet valuation purposes unless specified otherwise in Annex I.
   2.   The revaluation of gold, foreign currency instruments, securities and financial instruments both on-balance-sheet and off-balance-sheet, shall be performed at the year-end at mid-market rates and prices.
   3.   No distinction shall be made between price and currency revaluation differences for gold, but a single gold revaluation difference shall be accounted for, based on the euro price per defined unit of weight of gold derived from the euro/US dollar exchange rate on the revaluation date. Revaluation shall take place on a currency-by-currency basis for foreign exchange, including on-balance-sheet and off-balance-sheet transactions, and on a code-by-code basis i.e. same ISIN number/type for securities, except for those securities included in the item ‘Other financial assets’, which shall be treated as separate holdings.
   Article 9
   Reverse transactions
   Reverse transactions shall be accounted for in accordance with Article 8 of Guideline ECB/2006/16.
   Article 10
   Marketable equity instruments
   Marketable equity instruments shall be accounted for in accordance with Article 9 of Guideline ECB/2006/16. All points of Article 9(3) shall apply to the ECB.
   CHAPTER III
   INCOME RECOGNITION
   Article 11
   Income recognition
   1.   Article 11(1), (2), (3), (5) and (7) of Guideline ECB/2006/16 shall apply to income recognition.
   2.   Holdings on special revaluation accounts stemming from contributions according to Article 49.2 of the Statute with respect to central banks of Member States for which the derogation has been abrogated shall be used to offset unrealised losses when exceeding previous revaluation gains registered in the corresponding standard revaluation account as laid down by Article 11(1)(c) of Guideline ECB/2006/16, prior to the offsetting of such losses in accordance with Article 33.2 of the Statute. The holdings on special revaluation accounts for gold, for currencies and for securities shall be reduced pro rata in the event of a reduction in the holdings of the relevant assets.
   Article 12
   Cost of transactions
   Article 12 of Guideline ECB/2006/16 shall apply to this Decision.
   CHAPTER IV
   ACCOUNTING RULES FOR OFF-BALANCE-SHEET INSTRUMENTS
   Article 13
   General rules
   Article 13 of Guideline ECB/2006/16 shall apply to this Decision.
   Article 14
   Foreign exchange forward transactions
   Foreign exchange forward transactions shall be accounted for in accordance with Article 14 of Guideline ECB/2006/16.
   Article 15
   Foreign exchange swaps
   Foreign exchange swaps shall be accounted for in accordance with Article 15 of Guideline ECB/2006/16.
   Article 16
   Interest rate futures
   Interest rate futures shall be accounted for in accordance with Article 16 of Guideline ECB/2006/16.
   Article 17
   Interest rate swaps
   Interest rate swaps shall be accounted for in accordance with Article 17 of Guideline ECB/2006/16. Unrealised losses taken to the profit and loss account at the year-end shall be amortised in subsequent years according to the straight-line method.
   Article 18
   Forward rate agreements
   Forward rate agreements shall be accounted for in accordance with Article 18 of Guideline ECB/2006/16.
   Article 19
   Forward transactions in securities
   Forward transactions in securities shall be accounted for in accordance with Method A in Article 19(1) of Guideline ECB/2006/16.
   Article 20
   Options
   Options shall be accounted for in accordance with Article 20 of Guideline ECB/2006/16.
   CHAPTER V
   ANNUAL PUBLISHED BALANCE SHEET AND PROFIT AND LOSS ACCOUNT
   Article 21
   Formats
   1.   The format for the ECB's published annual balance sheet shall follow the format in Annex II.
   2.   The format of the ECB's published profit and loss account shall comply with Annex III.
   CHAPTER VI
   FINAL PROVISIONS
   Article 22
   Development, application and interpretation of rules
   1.   The ESCB's Accounting and Monetary Income Committee (AMICO) shall report to the Governing Council, via the Executive Board, on the development, application and implementation of the ESCB's accounting and financial reporting rules.
   2.   In interpreting this Decision, account shall be taken of the preparatory work, the accounting principles harmonised by Community law and generally accepted international accounting standards.
   3.   If a specific accounting treatment is not laid down in this Decision and in the absence of a decision to the contrary by the Governing Council, the ECB shall follow valuation principles in accordance with International Accounting Standards as adopted by the European Union relevant to the activities and accounts of the ECB.
   Article 23
   Repeal
   Decisions ECB/2002/11, ECB/2005/12 and ECB/2006/3 are hereby repealed. References to the repealed Decisions shall be construed as references to this Decision and shall be read in accordance with the correlation table in Annex IV.
   Article 24
   Final provision
   This Decision shall enter into force on 1 January 2007.

      Done at Frankfurt am Main, 10 November 2006.

            The President of the ECB

         Jean-Claude TRICHET

      (1)  OJ L 58, 3.3.2003, p. 38. Decision as last amended by Decision ECB/2006/3 (OJ L 89, 28.3.2006, p. 56).

      (2)  See page … of this Official Journal.

      ANNEX I
      COMPOSITION AND VALUATION RULES FOR THE BALANCE SHEET

         Note: the numbering relates to the balance sheet format given in Annex II.
      ASSETS

                  Balance sheet item

                  Categorisation of contents of balance sheet items

                  Valuation principle

                  1

                     Gold and gold receivables

                  Physical gold (i.e. bars, coins, plates, nuggets) in storage or ‘under way’. Non-physical gold, such as balances in gold sight accounts (unallocated accounts), term deposits and claims to receive gold arising from the following transactions: upgrading or downgrading transactions and gold location or purity swaps where there is a difference of more than one business day between release and receipt

                  Market value

                  2

                     Claim on non-euro area residents denominated in foreign currency

                  Claims on counterparties resident outside the euro area including international and supranational institutions and central banks outside the euro area denominated in foreign currency

                  2.1

                     Receivables from the IMF

                              (a)

                              Drawing rights within the reserve tranche (net)
                              National quota minus balances in euro at the disposal of the IMF. The No 2 account of the IMF (euro account for administrative expenses) may be included in this position or under the item ‘Liabilities to non-euro area residents denominated in euro’

                              (a)

                              Drawing rights within the reserve tranche (net)
                              Nominal value, translation at the year-end foreign exchange market rate

                              (b)

                              Special drawing rights
                              Holdings of special drawing rights (gross)

                              (b)

                              Special drawing rights
                              Nominal value, translation at the year-end foreign exchange market rate

                              (c)

                              Other claims
                              General arrangements to borrow (GAB), loans under special borrowing arrangements, deposits within the framework of the Poverty Reduction and Growth Facility (PRGF)

                              (c)

                              Other claims
                              Nominal value, translation at the year-end foreign exchange market rate

                  2.2

                     Balances with banks and security investments, external loans and other external assets

                              (a)

                              Balances with banks outside the euro area
                              Current accounts, fixed-term deposits, day-to-day money, reverse repo transactions

                              (a)

                              Balances with banks outside the euro area
                              Nominal value, translation at the year-end foreign exchange market rate

                              (b)

                              Security investments other than equity shares, participations and other securities under asset item ‘Other financial assets’ outside the euro area
                              Marketable notes and bonds, bills, zero bonds, money market paper, all issued by non-euro area residents

                              (b)

                              Marketable securities
                              Market price and foreign exchange market rate at year-end

                              (c)

                              External loans (deposits)
                              Loans to and non-marketable securities other than equity shares, participations and other securities under asset item ‘Other financial assets’ issued by non-euro area residents

                              (c)

                              External loans
                              Deposits at nominal value, non-marketable securities at cost; both translated at the year-end foreign exchange market rate

                              (d)

                              Other external assets
                              Non-euro area banknotes and coins

                              (d)

                              Other external assets
                              Nominal value, translation at the year-end foreign exchange market rate

                  3

                     Claims on euro area residents denominated in foreign currency

                              (a)

                              Securities
                              Marketable notes and bonds, bills, zero bonds, money market paper other than equity shares, participations and other securities under asset item ‘Other financial assets’

                              (a)

                              Marketable securities
                              Market price and foreign exchange market rate at year-end

                              (b)

                              Other claims
                              Non-marketable securities other than equity shares, participations and other securities under asset item ‘Other financial assets’, loans, deposits, reverse repo transactions, sundry lending

                              (b)

                              Other claims
                              Deposits at nominal value, non-marketable securities at cost, both translated at the year-end foreign exchange market rate

                  4

                     Claims on non-euro area residents denominated in euro

                  4.1

                     Balances with banks, security investments and loans

                              (a)

                              Balances with banks outside the euro area
                              Current accounts, fixed-term deposits, day-to-day money, reverse repo transactions in connection with the management of securities denominated in euro

                              (a)

                              Balances with banks outside the euro area
                              Nominal value

                              (b)

                              Security investments other than equity shares, participations and other securities under asset item ‘Other financial assets’ outside the euro area
                              Marketable notes and bonds, bills, zero bonds, money market paper, all issued by non-euro area residents

                              (b)

                              Marketable securities
                              Market price at year-end

                              (c)

                              Loans outside the euro area
                              Loans to and non-marketable securities issued by non-euro area residents

                              (c)

                              Loans outside the euro area
                              Deposits at nominal value, non-marketable securities at cost

                              (d)

                              Securities issued by entities outside the euro area
                              Securities issued by supranational or international organisations e.g. the EIB, irrespective of their geographical location

                              (d)

                              Securities issued by entities outside the euro area
                              Market price at year-end

                  4.2

                     Claims arising from the credit facility under ERM II

                  Lending according to the ERM II conditions

                  Nominal value

                  5

                     Lending to euro area credit institutions related to monetary policy operations denominated in euro

                  Items 5.1 to 5.5: transactions according to the respective monetary policy instruments described in Annex I to Guideline ECB/2000/7 of 31 August 2000 on monetary policy instruments and procedures of the Eurosystem (1)

                  5.1

                     Main refinancing operations

                  Regular liquidity-providing reverse transactions with a weekly frequency and normally a maturity of one week

                  Nominal value or repo cost

                  5.2

                     Longer-term refinancing operations

                  Regular liquidity-providing reverse transactions with a monthly frequency and normally a maturity of three months

                  Nominal value or repo cost

                  5.3

                     Fine-tuning reverse operations

                  Reverse transactions, executed as ad hoc transactions for fine-tuning purposes

                  Nominal value or repo cost

                  5.4

                     Structural reverse operations

                  Reverse transactions adjusting the structural position of the Eurosystem vis-à-vis the financial sector

                  Nominal value or repo cost

                  5.5

                     Marginal lending facility

                  Overnight liquidity facility at a pre-specified interest rate against eligible assets (standing facility)

                  Nominal value or repo cost

                  5.6

                     Credits related to margin calls

                  Additional credit to credit institutions, arising from value increases of underlying assets regarding other credit to these credit institutions

                  Nominal value or cost

                  6

                     Other claims on euro area credit institutions denominated in euro

                  Current accounts, fixed-term deposits, day-to-day money, reverse repo transactions in connection with the management of security portfolios under the asset item ‘Securities of euro area residents denominated in euro’, including transactions resulting from the transformation of former foreign currency reserves of the euro area, and other claims. Correspondent accounts with non-domestic euro area credit institutions. Other claims and operations unrelated to monetary policy operations of the Eurosystem

                  Nominal value or cost

                  7

                     Securities of euro area residents denominated in euro

                  Marketable securities other than equity shares, participations and other securities under asset item ‘Other financial assets’: notes and bonds, bills, zero bonds, money market paper held outright including government securities stemming from before EMU denominated in euro; ECB debt certificates purchased for fine-tuning purposes

                  Market price at year-end

                  8

                     General government debt denominated in euro

                  Claims on government stemming from before EMU (non-marketable securities, loans)

                  Deposits/loans at nominal value, non-marketable securities at cost

                  9

                     Intra-Eurosystem claims

                  9.1

                     Claims related to promissory notes backing the issuance of ECB debt certificates

                  Only an ECB balance sheet item
                  Promissory notes issued by NCBs, due to the back-to-back agreement in connection with ECB debt certificates

                  Nominal value

                  9.2

                     Claims related to the allocation of euro banknotes within the Eurosystem

                  Claims related to the ECB's banknote issue, according to Decision ECB/2001/15 of 6 December 2001 on the issue of euro banknotes (2)

                  Nominal value

                  9.3

                     Other claims within the Eurosystem (net)

                  Net position of the following sub-items:

                              (a)

                              net claims arising from balances of TARGET accounts and correspondent accounts of NCBs i.e. the net figure of claims and liabilities - see also liability item ‘Other liabilities within the Eurosystem (net)’

                              (a)

                              Nominal value

                              (b)

                              other intra-Eurosystem claims that may arise, including the interim distribution of ECB seigniorage income to NCBs

                              (b)

                              Nominal value

                  10

                     Items in course of settlement

                  Settlement account balances (claims), including the float of cheques in collection

                  Nominal value

                  11

                     Other assets

                  11.1

                     Coins of euro area

                  Euro coins

                  Nominal value

                  11.2

                     Tangible and intangible fixed assets

                  Land and buildings, furniture and equipment including computer equipment, software

                  Cost less depreciation
                  Depreciation is the systematic allocation of the depreciable amount of an asset over its useful life. The useful life is the period over which a fixed asset is expected to be available for use by the entity. Useful lives of individual material fixed assets may be reviewed on a systematic basis, if expectations differ from previous estimates. Major assets may comprise components with different useful lives. The lives of such components should be assessed individually
                  Capitalisation of expenditure: limit based (below EUR 10 000 excluding VAT: no capitalisation)

                  11.3

                     Other financial assets

                              —

                              Equity instruments, participating interests and investments in subsidiaries

                              —

                              Securities held as an earmarked portfolio

                              —

                              Financial fixed assets

                              —

                              Reverse repo transactions with credit institutions in connection with the management of securities portfolios under this item

                              (a)

                              Marketable equity instruments
                              Market value

                              (b)

                              Participating interests and illiquid equity shares
                              Cost subject to impairment

                              (c)

                              Investment in subsidiaries or significant interests
                              Net asset value

                              (d)

                              Marketable securities
                              Market value

                              (e)

                              Non-marketable securities
                              Cost

                              (f)

                              Financial fixed assets
                              Cost subject to impairment

                        Premiums/discounts are amortised
                  For equity instruments, the detailed rules are set out in Article 10 of this Decision

                  11.4

                     Off-balance sheet instruments revaluation differences

                  Valuation results of foreign exchange forwards, foreign exchange swaps, interest rate swaps, forward rate agreements, forward transactions in securities, foreign exchange spot transactions from trade date to settlement date

                  Net position between forward and spot, at the foreign exchange market rate

                  11.5

                     Accruals and prepaid expediture

                  Income not due in, but assignable to the reported period. Prepaid expenditure and accrued interest paid (3)

                  Nominal value, foreign exchange translated at market rate

                  11.6

                     Sundry

                              (a)

                              Advances, loans, other minor items. Loans on a trust basis

                              (a)

                              Nominal value/cost

                              (b)

                              Investments related to customer gold deposits

                              (b)

                              Market value

                              (c)

                              Net pension assets

                              (c)

                              As per Article 22(3)

                  12

                     Loss for the year

                  Nominal value

      LIABILITIES

                  Balance sheet item

                  Categorisation of contents of balance sheet items

                  Valuation principle

                  1

                     Banknotes in circulation

                  Euro banknotes issued by the ECB, according to Decision ECB/2001/15

                  Nominal value

                  2

                     Liabilities to euro area credit institutions related to monetary policy operations denominated in euro

                  Items 2.1, 2.2, 2.3 and 2.5: deposits in euro as described in Annex I to Guideline ECB/2000/7

                  2.1

                     Current accounts (covering the minimum reserve system)

                  Euro accounts of credit institutions that are included in the list of financial institutions subject to minimum reserves according to the Statute. This item contains primarily accounts used in order to hold minimum reserves

                  Nominal value

                  2.2

                     Deposit facility

                  Overnight deposits at a pre-specified interest rate (standing facility)

                  Nominal value

                  2.3

                     Fixed-term deposits

                  Collection for liquidity absorption purposes owing to fine-tuning operations

                  Nominal value

                  2.4

                     Fine-tuning reverse operations

                  Monetary policy-related transactions with the aim of liquidity absorption

                  Nominal value or repo cost

                  2.5

                     Deposits related to margin calls

                  Deposits of credit institutions, arising from value decreases of underlying assets regarding credits to these credit institutions

                  Nominal value

                  3

                     Other liabilities to euro area credit institutions denominated in euro

                  Repo transactions in connection with simultaneous reverse repo transactions for the management of securities portfolios under asset item ‘Securities of euro area residents denominated in euro’. Other operations unrelated to Eurosystem monetary policy operations. No current accounts of credit institutions

                  Nominal value or repo cost

                  4

                     ECB debt certificates issued

                  Only an ECB balance sheet item
                  Debt certificates as described in Annex I to Guideline ECB/2000/7
                  Discount paper, issued with the aim of liquidity absorption

                  Nominal value

                  5

                     Liabilities to other euro area residents denominated in euro

                  5.1

                     General government

                  Current accounts, fixed-term deposits, deposits repayable on demand

                  Nominal value

                  5.2

                     Other liabilities

                  Current accounts of staff, companies and clients including financial institutions listed as exempt from the obligation to hold minimum reserves - see liability item 2.1, etc.; fixed-term deposits, deposits repayable on demand

                  Nominal value

                  6

                     Liabilities to non-euro area residents denominated in euro

                  Current accounts, fixed-term deposits, deposits repayable on demand including accounts held for payment purposes and accounts held for reserve management purposes: of other banks, central banks, international/supranational institutions including the Commission of the European Communities; current accounts of other depositors. Repo transactions in connection with simultaneous reverse repo transactions for the management of securities denominated in euro. Balances of TARGET accounts of central banks of Member States that have not adopted the euro

                  Nominal value or repo cost

                  7

                     Liabilities to euro area residents denominated in foreign currency

                  Current accounts. Liabilities under repo transactions; usually investment transactions using foreign currency assets or gold

                  Nominal value, translation at year-end foreign exchange market rate

                  8

                     Liabilities to non-euro area residents denominated in foreign currency

                  8.1

                     Deposits, balances and other liabilities

                  Current accounts. Liabilities under repo transactions; usually investment transactions using foreign currency assets or gold

                  Nominal value, translation at the year-end foreign exchange market rate

                  8.2

                     Liabilities arising from the credit facility under ERM II

                  Borrowing according to the ERM II conditions

                  Nominal value, translation at the year-end foreign exchange market rate

                  9

                     Counterpart of special drawing rights allocated by the IMF

                  SDR-denominated item which shows the amount of SDRs that were originally allocated to the respective country/NCB

                  Nominal value, translation at the year-end foreign exchange market rate

                  10

                     Intra-Eurosystem liabilities

                  10.1

                     Liabilities equivalent to the transfer of foreign reserves

                  ECB balance sheet item, denominated in euro

                  Nominal value

                  10.2

                     Other liabilities within the Eurosystem (net)

                  Net position of the following sub-items:

                              (a)

                              net liabilities arising from balances of TARGET accounts and correspondent accounts of NCBs i.e. the net figure of claims and liabilities -see also asset item ‘Other claims within the Eurosystem (net)’

                              (a)

                              Nominal value

                              (b)

                              other intra-Eurosystem liabilities that may arise, including the interim distribution of ECB income on euro banknotes to NCBs

                              (b)

                              Nominal value

                  11

                     Items in course of settlement

                  Settlement account balances (liabilities), including the float of giro transfers

                  Nominal value

                  12

                     Other liabilities

                  12.1

                     Off-balance sheet instruments revaluation differences

                  Valuation results of foreign exchange forwards, foreign exchange swaps, interest rate swaps, forward rate agreements, forward transactions in securities, foreign exchange spot transactions from trade date to settlement date

                  Net position between forward and spot, at the foreign exchange market rate

                  12.2

                     Accruals and income collected in advance

                  Expenditure falling due in a future period but relating to the reporting period. Income received in the reported period but relating to a future period

                  Nominal value, foreign exchange translated at market rate

                  12.3

                     Sundry

                              (a)

                              Taxation suspense accounts. Foreign currency credit or guarantee cover accounts. Repo transactions with credit institutions in connection with simultaneous reverse repo transactions for the management of securities portfolios under asset item ‘Other financial assets’. Compulsory deposits other than reserve deposits. Other minor items. Liabilities on a trust basis

                              (a)

                              Nominal value or (repo) cost

                              (b)

                              Customer gold deposits

                              (b)

                              Market value

                              (c)

                              Net pension liabilities

                              (c)

                              As per Article 22(3)

                  13

                     Provisions

                  For foreign exchange rate, interest rate and gold price risks, and for other purposes e.g. expected future expenses and contributions according to Article 49.2 of the Statute with respect to central banks of Member States whose derogations have been abrogated

                  Cost/nominal value

                  14

                     Revaluation accounts

                              (a)

                              Revaluation accounts related to price movements for gold, for every type of euro-denominated securities, for every type of foreign currency-denominated securities, for options; market valuation differences related to interest rate risk derivatives; revaluation accounts related to foreign exchange rate movements for every currency net position held, including foreign exchange swaps/forwards and SDRs

                              (b)

                              Special revaluation accounts stemming from contributions according to Article 49.2 of the Statute with respect to central banks of Member States whose derogations have been abrogated - see Article 11(2)

                  Revaluation difference between average cost and market value, foreign exchange translated at market rate

                  15

                     Capital and reserves

                  15.1

                     Capital

                  Paid-up capital

                  Nominal value

                  15.2

                     Reserves

                  Legal reserves, according to Article 33 of the Statute and contributions according to Article 49.2 of the Statute with respect to central banks of Member States whose derogations have been abrogated

                  Nominal value

                  16

                     Profit for the year

                  Nominal value

         (1)  OJ L 310, 11.12.2000, p. 1.

         (2)  OJ L 337, 20.12.2001, p. 52.

         (3)  I.e. accrued interest purchased with a security.

      ANNEX II
      Annual balance sheet of the ECB

                  (EUR million)

                  Assets

                  Reporting year

                  Previous year

                  Liabilities

                  Reporting year

                  Previous year

                              1

                              Gold and gold receivables

                              2

                              Claims on non-euro area residents denominated in foreign currency

                                          2.1

                                          Receivables from the IMF

                                          2.2

                                          Balances with banks and security investments, external loans and other external assets

                              3

                              Claims on euro area residents denominated in foreign currency

                              4

                              Claims on non-euro area residents denominated in euro

                                          4.1

                                          Balances with banks, security investments and loans

                                          4.2

                                          Claims arising from the credit facility under ERM II

                              5

                              Lending to euro area credit institutions related to monetary policy operations denominated in euro

                                          5.1

                                          Main refinancing operations

                                          5.2

                                          Longer-term refinancing operations

                                          5.3

                                          Fine-tuning reverse operations

                                          5.4

                                          Structural reverse operations

                                          5.5

                                          Marginal lending facility

                                          5.6

                                          Credits related to margin calls

                              6

                              Other claims on euro area credit institutions denominated in euro

                              7

                              Securities of euro area residents denominated in euro

                              8

                              General government debt denominated in euro

                              9

                              Intra-Eurosystem claims

                                          9.1

                                          Claims related to promissory notes backing the issuance of ECB debt certificates

                                          9.2

                                          Claims related to the allocation of euro banknotes within the Eurosystem

                                          9.3

                                          Other claims within the Eurosystem (net)

                              10

                              Items in course of settlement

                              11

                              Other assets

                                          11.1

                                          Coins of euro area

                                          11.2

                                          Tangible and intangible fixed assets

                                          11.3

                                          Other financial assets

                                          11.4

                                          Off-balance sheet instruments revaluation differences

                                          11.5

                                          Accruals and prepaid expenses

                                          11.6

                                          Sundry

                              12

                              Loss for the year

                              1

                              Banknotes in circulation

                              2

                              Liabilities to euro area credit institutions related to monetary policy operations denominated in euro

                                          2.1

                                          Current accounts covering the minimum reserve system

                                          2.2

                                          Deposit facility

                                          2.3

                                          Fixed-term deposits

                                          2.4

                                          Fine-tuning reverse operations

                                          2.5

                                          Deposits related to margin calls

                              3

                              Other liabilities to euro area credit institutions denominated in euro

                              4

                              ECB debt certificates issued

                              5

                              Liabilities to other euro area residents denominated in euro

                                          5.1

                                          General government

                                          5.2

                                          Other liabilities

                              6

                              Liabilities to non-euro area residents denominated in euro

                              7

                              Liabilities to euro area residents denominated in foreign currency

                              8

                              Liabilities to non-euro area residents denominated in foreign currency

                                          8.1

                                          Deposits, balances and other liabilities

                                          8.2

                                          Liabilities arising from the credit facility under ERM II

                              9

                              Counterpart of special drawing rights allocated by the IMF

                              10

                              Intra-Eurosystem liabilities

                                          10.1

                                          Liabilities equivalent to the transfer of foreign reserves

                                          10.2

                                          Other liabilities within the Eurosystem (net)

                              11

                              Items in course of settlement

                              12

                              Other liabilities

                                          12.1

                                          Off-balance sheet instruments revaluation differences

                                          12.2

                                          Accruals and income collected in advance

                                          12.3

                                          Sundry

                              13

                              Provisions

                              14

                              Revaluation accounts

                              15

                              Capital and reserves

                                          15.1

                                          Capital

                                          15.2

                                          Reserves

                              16

                              Profit for the year

                  Total assets

                  Total liabilities

         (1)  The ECB may alternatively publish exact euro amounts, or amounts rounded in a different manner.

      ANNEX III
      PUBLISHED PROFIT AND LOSS ACCOUNT OF THE ECB

                  (EUR million)

                  Profit and loss account for the year ending 31 December …

                  Reporting year

                  Previous year

                  1.1.1

                     Interest income on foreign reserve assets

                  1.1.2

                     Interest income arising from the allocation of euro banknotes within the Eurosystem

                  1.1.3

                     Other interest income

                  1.1

                     Interest income

                  1.2.1

                     Remuneration of NCBs’ claims in respect of foreign reserves transferred

                  1.2.2

                     Other interest expense

                  1.2

                     Interest expense

                  1

                  Net interest income

                  2.1

                     Realised gains/losses arising from financial operations

                  2.2

                     Write-downs on financial assets and positions

                  2.3

                     Transfer to/from provisions for foreign exchange rate and price risks

                  2

                  Net result of financial operations, write downs and risk provisions

                  3.1

                     Fees and commissions income

                  3.2

                     Fees and commissions expense

                  3

                  Net income/expense from fees and commissions (2)

                  4

                  Income from equity shares and participating interests

                  5

                  Other income

                     Total net income

                  6

                  Staff costs (3)

                  7

                  Administrative expenses (3)

                  8

                  Depreciation of tangible and intangible fixed assets

                  9

                  Banknote production services (4)

                  10

                  Other expenses

                     (Loss)/profit for the year

         (1)  The ECB may alternatively publish exact euro amounts, or amounts rounded in a different manner.

         (2)  The breakdown between income and expense may alternatively be provided in the explanatory notes to the annual accounts.

         (3)  Including administrative provisions.

         (4)  This item is used in case of outsourced banknote production (for the cost of the services provided by external companies in charge of the production of banknotes on behalf of the central banks). It is recommended that the costs incurred in connection with the issue of euro banknotes should be taken to the profit and loss account as they are invoiced or otherwise incurred, see also Guideline ECB/2006/16.

      ANNEX IV
      CORRELATION TABLE

                  Decision ECB/2002/11

                  This Decision

                  —

                  Article 7

                  Article 7

                  Article 8

                  Article 8

                  Article 9

                  Article 9

                  Article 10

                  Article 10

                  Article 11

                  Article 11

                  Article 12

                  Article 12

                  Article 13

                  Article 13

                  Article 14

                  Article 14

                  Article 15

                  Article 15

                  Article 16

                  Article 16

                  Article 17

                  Article 17

                  Article 18

                  Article 18

                  Article 19

                  —

                  Article 20

                  Article 19

                  Article 21

                  Article 20

                  Article 22

                  Article 21

                  Article 23

                  Article 22

                  Article 24


title: Decision of the European Parliament of 5 May 2010 on discharge in respect of the implementation of the budget of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008

text:
               25.9.2010

               EN

               Official Journal of the European Union

               L 252/196

         DECISION OF THE EUROPEAN PARLIAMENT
   of 5 May 2010
   on discharge in respect of the implementation of the budget of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008
   (2010/542/EU)
   THE EUROPEAN PARLIAMENT,
   having regard to the final annual accounts of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008,
   having regard to the Court of Auditors’ report on the final annual accounts of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008, together with the Foundation’s replies (1),
   having regard to the Council’s recommendation of 16 February 2010 (5827/2010 — C7-0061/2010),
   having regard to Article 276 of the EC Treaty and Article 319 of the Treaty on the Functioning of the European Union,
   having regard to Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (2), and in particular Article 185 thereof,
   having regard to Regulation (EEC) No 1365/75 of the Council of 26 May 1975 on the creation of a European Foundation for the Improvement of Living and Working Conditions (3), and in particular Article 16 thereof,
   having regard to Commission Regulation (EC, Euratom) No 2343/2002 of 19 November 2002 on the framework Financial Regulation for the bodies referred to in Article 185 of Regulation (EC, Euratom) No 1605/2002 (4), and in particular Article 94 thereof,
   having regard to Rule 77 of, and Annex VI to, its Rules of Procedure,
   having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Employment and Social Affairs (A7-0088/2010),

               1.

               Grants the Director of the European Foundation for the Improvement of Living and Working Conditions discharge in respect of the implementation of the Foundation’s budget for the financial year 2008;

               2.

               Sets out its observations in the resolution below;

               3.

               Instructs its President to forward this Decision and the resolution that forms an integral part of it to the Director of the European Foundation for the Improvement of Living and Working Conditions, the Council, the Commission and the Court of Auditors, and to arrange for their publication in the Official Journal of the European Union (L series).

            The President

         Jerzy BUZEK

            The Secretary-General

         Klaus WELLE

      (1)  OJ C 304, 15.12.2009, p. 142.

      (2)  OJ L 248, 16.9.2002, p. 1.

      (3)  OJ L 139, 30.5.1975, p. 1.

      (4)  OJ L 357, 31.12.2002, p. 72.
    ---documentbreak---

               25.9.2010

               EN

               Official Journal of the European Union

               L 252/198

         RESOLUTION OF THE EUROPEAN PARLIAMENT
   of 5 May 2010
   with observations forming an integral part of its Decision on discharge in respect of the implementation of the budget of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008
   THE EUROPEAN PARLIAMENT,
   having regard to the final annual accounts of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008,
   having regard to the Court of Auditors’ report on the final annual accounts of the European Foundation for the Improvement of Living and Working Conditions for the financial year 2008, together with the Foundation’s replies (1),
   having regard to the Council’s recommendation of 16 February 2010 (5827/2010 — C7-0061/2010),
   having regard to Article 276 of the EC Treaty and Article 319 of the Treaty on the Functioning of the European Union,
   having regard to Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (2), and in particular Article 185 thereof,
   having regard to Regulation (EEC) No 1365/75 of the Council of 26 May 1975 on the creation of a European Foundation for the Improvement of Living and Working Conditions (3), and in particular Article 16 thereof,
   having regard to Commission Regulation (EC, Euratom) No 2343/2002 of 19 November 2002 on the framework Financial Regulation for the bodies referred to in Article 185 of Regulation (EC, Euratom) No 1605/2002 (4), and in particular Article 94 thereof,
   having regard to Rule 77 of, and Annex VI to, its Rules of Procedure,
   having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Employment and Social Affairs (A7-0088/2010),

               A.

               whereas the Court of Auditors states that it has obtained reasonable assurances that the annual accounts for the financial year 2008 are reliable and that the underlying transactions are legal and regular,

               B.

               whereas on 23 April 2009 Parliament granted the Director of the European Foundation for the Improvement of Living and Working Conditions discharge for implementation of the Foundation’s budget for the financial year 2007 (5), and in its resolution accompanying the discharge decision, inter alia:

                           —

                           deplored the fact that in 2007, as in 2006, the Court of Auditors found weaknesses in recruitment procedures; in particular, the Court of Auditors again found a case where the selection criteria were not defined in conformity with the vacancy notice,

                           —

                           was concerned that in three procurement procedures the Court of Auditors found the following anomalies:

                                       (a)

                                       the financial evaluation procedure for a contract was not clearly specified in the tender documents,

                                       (b)

                                       the selection criteria did not make it possible to evaluate the financial capacity of the candidates properly,

               1.

               Expresses its satisfaction that the Court of Auditors has declared the annual accounts of the Foundation for the financial year 2008 to be legal and regular;

      Performance

               2.

               Notes that in 2007 the Foundation carried out an ex-post assessment of its 2001-2004 work programme in order to determine its impact, added value and effectiveness; congratulates the Foundation on having demonstrated, by means of that assessment, that the planned operations were duly completed; notes, further, that recent information included in the assessment of the Agencies ordered by the Commission in 2009 showed that in 2008 as well the Foundation duly completed its planned operations;

               3.

               Congratulates the Foundation on launching another ex-post assessment exercise, in this case of its 2005-2008 work programme; calls on the Foundation, therefore, to keep it informed of the results of that assessment so that it can determine more effectively the Foundation’s impact, added value and effectiveness during that specific period;

               4.

               Calls on the Foundation to set out, in a table to be annexed to the Court of Auditors’ next report, a comparison of operations carried out during the year for which discharge is to be granted and in the previous financial year, so as to enable the discharge authority to assess more effectively its performance from one year to the next;

      Operating appropriations carried over

               5.

               Notes that, according to the Court of Auditors, the amount carried over represented more than 55 % of appropriations (EUR 4 900 000) for the financial year 2008; acknowledges, however, the Foundation’s reply to the effect that shortcomings exist, but that the level of appropriations carried over is lower than that indicated by the Court of Auditors (10 %) by virtue of the fact that its annual programming in any case made provision for 45 % of the appropriations under Title 3 to be carried over, in view of the duration of the study contracts and the Foundation’s payment schedule; stresses, nevertheless, that this state of affairs indicates shortcomings in the planning and programming of the Foundation’s operational activities and is at odds with the principle of annuality; calls on the Foundation, therefore, to take action to prevent this situation recurring in future and then to inform the discharge authority of what it has done;

      Budget transfers without supporting documents

               6.

               Notes the Court of Auditors’ statement that budget transfers were not properly justified, since no estimate of needs had been provided and the Administrative Board had not been informed; congratulates the Foundation, however, on having now remedied this shortcoming;

      Procurement procedures

               7.

               Calls on the Foundation to take steps to improve the monitoring of its contracts and the programming of its procurement procedures, by issuing new invitations to tender well before the corresponding contracts come to an end; in that connection, emphasises that the Court of Auditors states that in two cases the Foundation improperly extended a contract beyond the maximum authorised duration and that in another case it failed to provide any justification for using a negotiated procedure;

      Human resources

               8.

               Calls on the Foundation’s management to take steps, as part of its human resources management policy and in keeping with its obligations concerning implementation of the budget, to make better provision in advance for the departure of key staff members;

               9.

               Calls on the Foundation to enter staff numbers, including contract staff (87 persons), in the activity report in a transparent manner;

               10.

               Congratulates the Foundation on having introduced, in 2008, recruitment procedures consistent with the recommendations made by the Court of Auditors in the last two years; in particular, notes that on this occasion the Court of Auditors no longer identifies shortcomings in the Foundation’s recruitment procedures (for example, as regards the selection criteria) which were such as to undermine the transparency and non-discriminatory nature of those procedures;

      Internal audit

               11.

               Expresses concern at the fact that the Foundation’s financial statements for 2008 were inadequate and inconsistent with the 2007 accounts and consequently required substantial correction in the course of the audit; notes that this state of affairs can be explained by the fact that the Foundation was forced to recruit a temporary member of staff for a short period of time in order to close the 2008 accounts and that, in addition, the handover from one accounting officer to the next was not seamless; calls on the Foundation, therefore, to take steps to ensure that such a situation does not recur in the future;

               12.

               Acknowledges that 26 out of the 54 recommendations made by the Internal Audit Service (IAS) have been implemented since 2006; notes that, amongst the 28 which still need to be implemented, eight are considered to be ‘very important’; in particular, urges the Foundation to put in place the remaining internal control standards (i.e. delegation for financial actors), to follow up the implementation of other internal control standards (i.e. effective coordination of the internal control system and compliance of procurement procedures with the Financial Regulation and its implementing rules), and to introduce an effective planning and monitoring system (e.g. by setting up a risk-assessment system in respect of the Foundation’s activities, putting in place an activity-based methodology and monitoring IT tools);

               13.

               Refers for other observations accompanying its Decision on discharge, which are of a horizontal nature, to its resolution of 5 May 2010 (6) on the performance, financial management and control of the agencies.

      (1)  OJ C 304, 15.12.2009, p. 142.

      (2)  OJ L 248, 16.9.2002, p. 1.

      (3)  OJ L 139, 30.5.1975, p. 1.

      (4)  OJ L 357, 31.12.2002, p. 72.

      (5)  OJ L 255, 26.9.2009, p. 190.

      (6)  Texts adopted, P7_TA(2010)0139. See page 241 of this Official Journal.