Commission Implementing Regulation (EU) 2015/840 of 29 May 2015 on controls carried out by Responsible Authorities pursuant to Regulation (EU) No 514/2014 of the European Parliament and of the Council laying down general provisions on the Asylum, Migration and Integration Fund and on the instrument for financial support for police cooperation, preventing and combating crime, and crisis management

Article 1

Administrative controls

The Responsible Authority shall carry out administrative controls on all financial declarations sent by the beneficiaries with the aim of receiving Union funding, in accordance with the grant agreements defined in point (d) of Article 1 of Commission Delegated Regulation (EU) No 1042/2014 (¹) (‘financial declarations’). These controls shall, as a minimum, include the following elements:

(a) checks designed to confirm the formal correctness and the arithmetic accuracy of the financial declarations;

(b) checks to confirm that the project has achieved the objectives set out in the grant agreement or that progress is being made towards achieving those objective;

(c) an analytical review to assess the relevance of the declared expenditure in the financial declarations and its compliance with the requirements set out in the grant agreement and the applicable Union and national rules.

Article 2

General principles regarding on-the-spot controls

The Responsible Authority shall carry out financial and operational on-the-spot controls.

On-the-spot controls shall be carried out on the basis of documentation and records held by the project beneficiaries.

Unannounced on-the-spot controls may be carried out in accordance with the national law where the level of assurance could be undermined if prior notice was given.

Article 3

Financial on-the-spot controls

The Responsible Authority shall verify that:

(a) the expenditure in relation to the financial declarations corresponds to the accounting records and supporting documents held by the project beneficiaries;

(b) the expenditure in relation to the financial declarations satisfies the eligibility requirements set out in the grant agreement and the applicable Union and national rules;

(c) the sources of financing comply with Article 16(2) of Regulation (EU) No 514/2014.

Article 4

Conditions for reducing or increasing financial on-the-spot controls

The Responsible Authority may reduce the coverage of financial on-the-spot controls in the following financial year N+1 when the two following conditions are met:

(a) the error rate is less than 2 % of the Union contribution controlled in the annual accounts for financial year N,

(b) the financial on-the-spot controls carried out since the start of the national programme cover a minimum of 10 % of the cumulated Union contribution to all the projects declared as finalised in the annual accounts since the start of the programme.

The financial on-the-spot controls for the following financial year (N+1) shall cover a percentage of the cumulated Union contribution to the projects declared as finalised in the annual accounts for the financial year N+1 that is higher than the corresponding percentage in financial year N. This higher percentage shall not be lower than 10 %. Additionally, up to financial year N+1 the financial on-the-spot controls carried out since the start of the national programme shall cover a minimum of 10 % of the cumulated Union contribution to all the projects declared as finalised in the annual accounts since the start of the programme.

Where the error rate resulting from the increased controls carried out in year N+1 falls below 2 %, the Responsible Authority shall, in the next financial year (N+2) carry out financial on-the-spot controls on a minimum of 10 % of the cumulated Union contribution to the projects declared as finalised in the annual accounts for financial year N+2.

Article 5

Operational on-the-spot controls

Article 6

Sample methodology for on-the-spot controls

The Responsible Authority shall carry out on-the-spot controls on a sample of projects representing an appropriate mix of types and sizes of projects, transactions, beneficiaries and implementing modes. The sample shall take into account any risk factors as well as cost-benefit aspects of the controls.

Article 7

Control reports

The Responsible Authority shall draw up a report on each administrative and on-the-spot control, giving the following information:

(a) full identification of the project and its corresponding grant agreement;

(b) the name and signature of the controller;

(c) the beneficiary's name;

(d) the type of controls (administrative, financial or operational on-the-spot or a combination);

(e) where necessary, the scope of the control;

(f) the expenditure falling within the scope of the control and the expenditure (sample) actually verified;

(g) the amount of expenditure considered ineligible; and

(h) a description of the major findings, weaknesses, errors and irregularities, additional controls and analysis carried out, recommendations and corrective measures proposed and the reaction of the beneficiary.

Article 8

Specific conditions

Where the Responsible Authority acts as executing body, as referred to in Article 8 of Delegated Regulation (EU) No 1042/2014, the administrative and on-the-spot controls referred to in Articles 1 and 2 of this Regulation shall be carried out by an entity or a person functionally independent from the entities or persons managing the projects.

Article 9

Retention of supporting documents

To that end, the Responsible Authority shall lay down rules regarding the retention of records, documents and metadata by the beneficiaries.

Documents may be kept exclusively in electronic form only 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.

Article 10

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

This Regulation shall be binding in its entirety and directly applicable in the Member States in accordance with the Treaties.