{
  "url": "https://openlegislation.uk/eu-regulation-2018-1291/annex",
  "json_url": "https://openlegislation.uk/eu-regulation-2018-1291/annex.json",
  "legislation": "eur/2018/1291",
  "legislation_title": "Commission Delegated Regulation (EU) 2018/1291 of 16 May 2018 amending Delegated Regulation (EU) No 1042/2014 supplementing Regulation (EU) No 514/2014 of the European Parliament and of the Council with regard to the designation and management and control responsibilities of Responsible Authorities and with regard to status and obligations of Audit Authorities",
  "legislation_url": "https://openlegislation.uk/eu-regulation-2018-1291",
  "path": "annex",
  "kind": "annex",
  "number": null,
  "heading": null,
  "text": "‘ANNEX II\nModel for the annual control report\nAnnual control report [FUND]\n(1)\nINTRODUCTION\nThis section shall include the following information:\n1.1 Identification of the Audit Authority and other bodies that have been involved in preparing the report.\n1.2 Reference period (i.e. the financial year).\n(2)\nCOMPLIANCE WITH DESIGNATION CRITERIA AND SIGNIFICANT CHANGES IN MANAGEMENT AND CONTROL SYSTEM(S) (if applicable)\nThis section shall include the following information:\n2.1 Details of any significant changes in the management and control systems related to the competent authorities' responsibilities (including, where applicable, any delegation of functions), the effective date of such changes as well as the impact of these changes on the audit work.\n2.2 Based on the audit work carried out by the Audit Authority, confirmation of whether the management and control system still complies with the designation criteria defined in Article 2 and Annex I of Commission Delegated Regulation (EU) No 1042/2014.\n2.3 Information on reporting to the Designating Authority on the Responsible Authority's compliance with the designation criteria set out in Article 2.2 and Annex I of Commission Delegated Regulation (EU) No 1042/2014.\n(3)\nCHANGES TO THE AUDIT STRATEGY\nThis section shall include the following information:\n3.1 Details of changes that have been made to the audit strategy and an explanation of the reasons for those changes, in particular details of any modifications to the sampling method used for audits of expenditure (see section 5 below).\n(4)\nSYSTEM AUDITS\nThis section shall include the following information:\n4.1 Details of the bodies that have carried out system audits to verify whether the management and control system of the fund have functioned effectively (as provided for in Article 14(2) of Commission Delegated Regulation (EU) No 1042/2014).\n4.2 In relation to Table 10.1 “Results of system audits” annexed to the annual control report, a description of the main findings and conclusions drawn from system audits on key requirements.\n4.3 Indication of whether any problems detected are considered to be systemic in nature, quantification of irregular financial data and applicable corrective measures to address such systemic errors, including any related financial corrections made in accordance with Article 46 of Regulation (EU) No 514/2014 and Implementing Regulation (EU) No 378/2015.\n4.4 Information on the follow-up of audit recommendations from system audits carried out in previous years.\n(5)\nAUDITS OF EXPENDITURE\nThis section shall include the following information:\n5.1 Details of the bodies that carried out the audits of expenditure (as provided for in Articles 14.3 and 14.4 of Commission Delegated Regulation (EU) No 1042/2014).\n5.2 Description of the sampling methodology applied, specifying the sampling parameters used and the underlying calculations and professional judgement applied to the sample selection, the calculation of the total error rate (including stratification where applicable) and information on whether the methodology is in line with the audit strategy. If stratification is applied, the strata parameters need to be described.\n5.3 Analysis of the principal results of the audits of expenditure, describing the number of sample items audited, the respective amounts and type of financial data audited, the nature and type of errors detected and the applicable corrective measures proposed by the Audit Authority (including measures to avoid similar errors in the future, financial corrections for the individual irregularities detected as well as any applicable extrapolated or flat-rate financial corrections). If stratification is applied, further information by strata is to be provided in this section and summarised in Table 10.2 “Results of audits of expenditure” annexed to the annual control report.\n5.4 If the audit sample includes interim payments and/or final payment clearing advance payments declared in the accounts of previous financial years, the amount of the advance payments falling within the scope of audits of expenditure, the errors detected and applicable financial corrections relating to these advance payments shall be presented in Table 10.3 “Results of audits on additional expenditure” annexed to the annual control report.\n5.5 Explanations on how the error rates presented in Table 10.2 are calculated and, if applicable, information on the audits of additional expenditure presented in Table 10.3.\n5.6 Information on whether any irregularities detected by the audits of expenditure are considered to be systemic in nature and therefore entail a risk to other payments, including the quantification of their impact on the population and any related financial corrections.\n5.7 Information on the status of implementation by the Responsible Authority of the corrective measures including financial corrections proposed by the Audit Authority as a result of the audits of expenditure before submitting the “final accounts” to the Commission. Any possible deviations between the corrections proposed by the Audit Authority and the corrections implemented by the Responsible Authority should be disclosed.\n5.8 Information on the follow-up of audits of expenditure carried out in previous years, in particular on deficiencies of a systemic nature.\n(6)\nAUDITS OF ACCOUNTS\nThis section shall include the following information:\n6.1 Details of the bodies that have carried out audits of accounts (as provided for in Article 14.5 of Commission Delegated Regulation (EU) No 1042/2014).\n6.2 Description of the audit approach used to verify the financial data in the accounts accompanying the request for payment of the annual balance submitted by the Responsible Authority defined in Article 14.5 of Commission Delegated Regulation (EU) No 1042/2014. This should include a reference to the audit work carried out as part of the system audits (detailed in section 4) and the audits of expenditure (detailed in section 5) with relevance to the assurance required on the accounts.\n6.3 Conclusions drawn from the audit of accounts regarding the true and fair view of the financial data in the accounts accompanying the request for payment of the annual balance submitted by the Responsible Authority, as well as the financial corrections made and reflected in the accounts as a result of such audits.\n6.4 Indication of whether any irregularities detected are considered to be systemic in nature and the applicable corrective measures taken.\n(7)\nCOORDINATION BETWEEN AUDIT BODIES AND SUPERVISORY WORK BY THE AUDIT AUTHORITY (where applicable)\nThis section shall include the following information:\n7.1 Description of the procedure for coordination between the Audit Authority and any audit bodies that carried out audits as provided for in Article 13 of Commission Delegated Regulation (EU) No 1042/2014, where appropriate.\n7.2 Description of the procedure for supervision and quality review applied by the Audit Authority on the audit work carried out by such audit bodies.\n(8)\nOTHER INFORMATION\nThis section shall include the following information:\n8.1 Where applicable, information on reported fraud and suspicions of fraud detected as part of the audits performed by the Audit Authority (including the cases reported by other national or EU bodies and related to the operations audited by the Audit Authority), together with the measures taken.\n8.2 Where applicable, subsequent events that occurred after the “draft accounts” for the financial year were transmitted to the Audit Authority and before the associated annual control report was transmitted to the Commission, which may be relevant for the opinion issued by the Audit Authority. In particular, any variances between the financial data presented by the Responsible Authority in the “draft accounts” (i.e. the population from which the audit sample was drawn) and the final accounts submitted to the Commission should be disclosed and explained.\n(9)\nOVERALL LEVEL OF ASSURANCE\n9.1\nIndication of the overall level of assurance on the proper functioning of the management and control system, and explanation of how such a level was obtained from the combination of the results of the system audits, audits of expenditure and accounts. Where relevant, the Audit Authority shall also take into account the results of the audit work carried out by other national or EU audit bodies which may have an impact on the financial data reported for the financial year.\n9.2\nAssessment of any mitigating and corrective measures implemented by the Responsible Authority such as financial corrections, and an indication of whether additional corrective measures are needed from both a system and financial perspective.\n(10)\nANNEXES TO THE ANNUAL CONTROL REPORT\n10.1\nResults of system audits (template defined below)\n10.2\nResults of audits of expenditure (template defined below)\n10.3\nResults of audits on additional expenditure (if applicable)\n10.1\nResults of system audits\nCategory 1, 2, 3, 4 as defined in Table 2 — Annex I to Commission Implementing Regulation (EU) No 378/2015\nAudited Entity (e.g. Responsible Authority, Delegated Authority, etc.)\nTitle of the audit\nDate of the final audit report\nKey requirements (where applicable)[as defined in Table 1- Annex I to Commission Implementing Regulation (EU) No 378/2015]\nKR 1\nKR2\nKR3\nKR4\nKR5\nKR6\nKR7\nKR8\nKR9\nOverall assessment (category 1, 2, 3, 4) (as defined in Table 2 — Annex I to Commission Implementing Regulation (EU) No 378/2015)\nComments\n10.2\nResults of audits of expenditure\nA\nB\nC\nD\nE\nF\nG\nH\nI\nJ\nFund/type of payment (1)\nAmount in EUR corresponding to the population or sub-population in the “draft accounts” from which the sample was drawn (2)\nAudit sample (EUR amount) (3)\nAudit sample (as % of population) [D = C/B]\nAmount of errors detected by the Audit Authority in the sample EUR (4)\nError rate % in the sample[F = E/C] (4)\nTotal error rate in the population (5)\nTotal errors in the population (EUR amount)[H = G * B]\nFinancial corrections(EUR amount) implemented by the Responsible Authority as a result of the total error rate (6)\nResidual total error rate (7)[J = (H – I)/B]\nComments\nStrata (if applicable) (1)\nTotal (A)\nTotal (B)\nAmount EUR\n%\n10.3\nResults of audits on additional expenditure (8)\nK\nL\nM\nN\nO\nDescription\nFund/project/payment reference no.\nAdditional expenditure audited (3)\nAmount of errors in the additional expenditure audited (4)\nFinancial corrections implemented by the Responsible Authority on the additional expenditure audited (6)\nComments\nExpenditure linked to interim payments or final payments included in the random/statistical sample\nOther (to be described) …\n(1)\nIf the financial data — i.e. the audit population — is divided into different strata (e.g. advance payments, interim payments or final payments, other), the information is to be provided by strata where applicable. One line for each stratum and the strata parameters must be described in section 5 of the annual control report.\n(2)\nColumn B shall refer to the auditable population, i.e. the “draft accounts” representing all payments made by the Responsible Authority in the current financial year from which the sample was drawn.\n(3)\nIf the audit sample drawn from the current financial year includes interim payments and/or final payments clearing advance payments declared in the accounts of previous financial years, these advance payments shall fall within the scope of the audit of expenditure for the sampled interim payments and/or final payment.\nHowever, for reporting purposes only the interim payments or final payments sampled from the draft accounts of the current financial year shall be reported in Table 10.2 (Column C) and taken into consideration for calculating the audit coverage for the current financial year (Column D).\nThe “amount of the advance payments” cleared by interim payments and/or final payments and verified within the scope of audits of expenditure shall be reported in Table 10.3, Column M. See also footnote 8.\n(4)\nThe Audit Authority shall report the errors detected in the sample (as amounts and as percentage of the sample) before any financial corrections are applied by the Responsible Authority as a result of the audit work carried out by the Audit Authority.\nOnly the amount of errors relating to the audited interim payments or final payments drawn from the draft accounts of the current financial year shall be taken into consideration for the calculating and reporting of the amount of errors and the error rate in Table 10.2, columns E and F.\nThe amount of detected errors that have an impact on the “amount of advance payments” cleared should be reported in Table 10.3, Column N.\n(5)\nThe total error rate in the population is the Audit Authority's estimation of the total error rate in the “draft accounts” for the current financial year. The total error rate shall be calculated before any financial corrections are applied by the Responsible Authority.\nThe Audit Authority shall describe the methodology used to estimate the total error rate as well as the underlying calculations (including information on stratification, where applicable) in section 5 of the annual control report. In principle, the total error rate shall be the sum of the projected random errors and, if applicable, the total amount of systemic errors in the population and any uncorrected anomalous errors, divided by the population.\n(6)\nColumn I shall disclose the financial corrections implemented by the Responsible Authority solely on the auditable population, i.e. the “draft accounts” for the current financial year from which the sample was drawn.\nAny financial corrections relating to the “amount of advance payments” cleared should be reported in Table 10.3, Column O.\n(7)\nColumn J should disclose the residual error rate in the accounts after the Responsible Authority has implemented the financial corrections for the current financial year only.\nAny non-corrected errors in the “amount of advance payments” cleared should not be included in the calculation of the residual error rate for the accounts for the current financial year.\n(8)\nIn Table 10.3, the Audit Authority must report the results of any audits carried out on items other than the sampled amounts reported in Table 10.2. If the Audit Authority considers it necessary to carry out additional audits (e.g. risk-based audits, audits on negative or zero payments), the results of these additional audits should also be presented in Table 10.3.’",
  "extent": "E+W+S+N.I.",
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "footnote",
      "label": "f1",
      "text": "As defined in Article 38 of Regulation (EU) No 514/2014."
    },
    {
      "type": "footnote",
      "label": "f2",
      "text": "The sampling parameters include the sampling unit, population value and size, sample value and size, audit coverage (in EUR and the percentage of items and amounts covered) and the sampling criteria. For statistical sampling, the materiality level, confidence level, expected error rate and sampling interval should also be indicated."
    },
    {
      "type": "footnote",
      "label": "f3",
      "text": "If non-statistical sampling is applied, the Audit Authority should indicate the steps taken to ensure randomness of the sample (and its representativity) and provide a sufficient sample size to enable the Audit Authority to estimate the total error of the population and draw up a valid audit opinion."
    },
    {
      "type": "footnote",
      "label": "f4",
      "text": "For example: eligibility, public procurement, state aid."
    },
    {
      "type": "footnote",
      "label": "f5",
      "text": "Random, systemic or anomalous errors."
    },
    {
      "type": "footnote",
      "label": "f6",
      "text": "Flat-rate and/or extrapolated financial corrections may be applicable for example if there are systemic errors and/or if the total error rate on the draft accounts is material."
    },
    {
      "type": "footnote",
      "label": "f7",
      "text": "Column B of Table 10.2."
    },
    {
      "type": "footnote",
      "label": "f8",
      "text": "The overall level of assurance shall correspond to one of the four categories defined in Commission Implementing Regulation (EU) 2017/646: Category 1 (Works well. No or only minor improvement(s) needed), Category 2 (Works. Some improvement(s) needed), Category 3 (Works partially. Substantial improvements needed) and Category 4 (Essentially does not work)."
    },
    {
      "type": "footnote",
      "label": "f9",
      "text": "Category 1, 2, 3, 4 as defined in Table 2 — Annex I to Commission Implementing Regulation (EU) No 378/2015"
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/eur/2018/1291/annex",
    "retrieved_at": "2026-11-01T14:43:56.789081+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}