The European Court of Auditors has rebuked the European Commission for ignoring repeated warnings about deficiencies in its accounting system.
In its annual report published in Brussels yesterday, the Court said the Commission's 2001 budget faithfully represented revenue and expenditure for the year.
But it said that accounting errors and the Commission's flawed accounting system made it impossible for the Court to give a Statement of Assurance to that effect.
The Court's president, Mr Juan Manuel Fabra Valles, pointed out that annual reports had criticised the Commission's accounting system since 1994.
"Urgent, well considered action is needed in order to remedy the situation once and for all. We take due note of the Commission's reply to our report, in which it acknowledged these shortcomings and undertakes to present a plan to modernise the accounting system before the end of 2002, with a precise timetable and provision for necessary resources," he said.
Based in Luxembourg, the Court of Auditors examines EU finances, with the aim of improving financial management and reporting to citizens on how public funds are used.
Ireland's member of the Court, Ms Maire Geoghegan-Quinn, said that Ireland's debate on the Nice Treaty had made citizens more determined to find out what is happening in the EU.
"The quest for information about what is happening is unstoppable. All of that is good and positive," she said.
The Commission's chief accountant resigned earlier this year after a few months in office, complaining that the accounting system was inadequate.
Ms Geoghegan-Quinn said that, although the Commission acknowledged deficiencies in its accounting system, it was not devoting enough resources to overcoming them.
"The Commission needs urgently to develop a plan and a timetable that is reasonable and realistic," she said.
Responding to the report yesterday, the Budget Commissioner, Ms Michaele Schreyer, said the Commission was aware of its inadequacies and was taking action to improve its accounting system.
