Institutional Set-Up

NIPAC is a high-ranking official in the state administration, who shall ensure the overall coordination of assistance under the IPA Regulation. He shall, in particular:

1. ensure partnership between the Commission and the Republic of Macedonia, and a close link between the general accession process and the use of assistance under the IPA Regulation;
2. bear overall responsibility for:
   • the coherence and coordination of the programmes provided under this Regulation,
   • the annual programming for the transition assistance and institution building component at national level,
   • the coordination of the participation of the beneficiary country in the relevant cross-border programmes, both with Member States and with other beneficiary countries, as well as in the transnational, interregional or sea basins programmes under other Community instruments. The national IPA coordinator may delegate the tasks relating to this coordination to a cross-border cooperation coordinator,
3. draw up and, after examination by the IPA monitoring committee, submit the IPA annual and final reports on implementation to the Commission with a copy to the national authorising officer.

The main responsibility of SC is to ensure the coordination of the Regional Development Component and Human Resources Development Component under the responsibility of the NIPAC. SC shall be an entity within the state administration of the Republic of Macedonia, with no direct involvement in the implementation of components concerned.SC shall, in particular:

• coordinate assistance granted under the regional development component and the human resources development component;
• draft the Strategic Coherence Framework as defined in Article 154 IPA IR;
• ensure coordination between sectoral strategies and programmes.

CAO shall be a high-ranking official in the government of the Republic of Macedonia. CAO shall be responsible for issuing, monitoring and suspending or withdrawing the accreditation of the National Authorising Officer and the National Fund, in accordance with Articles 12 and 15 of IPA IR.

NAO shall be a high-ranking official in the state administration of the of the Republic of Macedonia. NAO shall:

• as the head of the National Fund, bear overall responsibility for the financial management of EU funds in the beneficiary country; he shall be responsible for the legality and regularity of the underlying transactions;
• be responsible for the effective functioning of management and control systems under the IPA Regulation.

For the purposes of point (1), the National Authorising Officer shall in particular fulfill the following tasks:

• provide assurance about the regularity and legality of underlying transactions;
• draw up and submit to the Commission certified statements of expenditure and payment applications; the National Authorising Officer shall bear overall responsibility for the accuracy of the payment application and for the transfer of funds to the Operating Structures and/or final beneficiaries;
• verify the existence and correctness of the co-financing elements;
• ensure the identification and immediate communication of any irregularity;
• make the financial adjustments required in connection with irregularities detected, according to the provisions of Article 50 of IPA IR;
• be the contact point for financial information sent between the Commission and the Republic of Macedonia.

For the purposes of point (2), the National Authorising Officer shall in particular fulfill the following tasks:

• be responsible for issuing, monitoring and suspending or withdrawing the accreditation of the Operating Structures;
• ensure the existence and effective functioning of systems of management of assistance under the IPA Regulation;
• ensure that the system of internal control concerning the management of funds is effective and efficient;
• report on the management and control systems;
• ensure that a proper reporting and information system is functioning;
• follow-up the findings of audit reports from the audit authority, in accordance with Article 30(1) of IPA IR;
• immediately notify the Commission, with a copy of the notification to the competent accrediting officer, of any significant change concerning the management and control systems.

Pursuant to the responsibilities laid down in points (1) and (2), the National Authorising Officer shall draw up an annual statement of assurance, as defined in Article 27 of IPA IR.

The National Fund shall be a body located in the Ministry of Finance in the Treasury Department, the department which has central budgetary competence. The National Fund shall act as a central treasury and be in charge of tasks of financial management of assistance under the IPA Regulation, under the responsibility of the National Authorising Officer.It shall in particular be in charge of organising the bank accounts, requesting funds from the Commission, authorising the transfer of funds received from the Commission to the operating structures or to the final beneficiaries, and the financial reporting to the Commission. Head of National Fund is a government official responsible for the proper performance of the functions of the National Fund, being directly responsible to the NAO.

Under the Decentralised Implementation System in the Republic of Macedonia, the Central Financing and Contracting Department as part of the Operating Structure for the first four IPA Components, in charge of tendering, contracting and payments will perform the role of a Contracting Authority, being responsible for the financial and administrative side of the procurement of services, supplies, works, grants and twinning of all programmes/projects and timely implementation and execution of EU funded projects/ programmes. In this process the European Commission (EC) will exercise systematic ex-ante control over the processes in the Operating Structure.Article 28 of IPA IR lists the functions and responsibilities of the Operating Structure. The Operating Structure shall be responsible for managing and implementing the programme or programmes concerned in accordance with the principle of sound financial management.For those purposes, it shall carry out a number of functions that include:

• drafting the annual or multi-annual programmes;
• monitoring programme implementation and guiding the work of the sectoral monitoring committee as defined in Article 59 of IPA IR, notably by providing the documents necessary for monitoring the quality of implementation of the programmes;
• drawing up the sectoral annual and final implementation reports defined in Article 61(1) of IPA IR and, after their examination by the sectoral monitoring committee, submitting them to the Commission, to the national IPA coordinator and to the national authorising officer;
• ensuring that operations are selected for funding and approved in accordance with the criteria and mechanisms applicable to the programmes, and that they comply with the relevant Community and national rules;
• setting up procedures to ensure the retention of all documents required to ensure an adequate audit trail, in accordance with Article 20 of IPA IR;
• arranging for tendering procedures, grant award procedures, the ensuing contracting, and making payments to, and recovery from, the final beneficiary;
• ensuring that all bodies involved in the implementation of operations maintain a separate accounting system or a separate accounting codification;
• ensuring that the national fund and the national authorising officer receive all necessary information on the procedures and verifications carried out in relation to expenditure;
• setting up, maintaining and updating the reporting and information system;
• carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate;
• ensuring internal audit of its different constituting bodies;
• ensuring irregularity reporting;
• ensuring compliance with the information and publicity requirements.

The heads of the bodies constituting the operating structure shall be clearly designated and shall be responsible for the tasks assigned to their respective bodies, in accordance with Article 11(3) of IPA IR.

The Operating Structure has a final objective of establishment of a fully decentralised system whereby the Commission’s ex-ante approval on project selection, tendering and contracting is waived.

An Audit Authority, functionally independent from all actors in the management and control systems and complying with internationally accepted audit standards, was established in the State Audit Office. The Audit Authority shall be responsible for verifying the effective and sound functioning of the management and control systems. The Audit Authority shall be responsible for verifying the effective and sound functioning of the management and control systems.The Audit Authority, under the responsibility of its head, shall in particular:

• during the course of each year, establish and fulfil an annual audit work plan which encompasses audits aimed at verifying:
  • the effective functioning of the management and control systems,
  • the reliability of accounting information provided to the Commission.

  The audit work shall include audits of an appropriate sample of operations or transactions, and an examination of procedures.

  The annual audit work plan shall be submitted to the national authorising officer and the Commission before the start of the year in question.

• submit the following:
  • an annual audit activity report following the model to be found in the framework agreement, setting out the resources used by the Audit Authority, and a summary of any weaknesses found in the management and control systems or in transaction findings from the audits carried out in accordance with the annual audit work plan during the previous 12 month period, ending on 30 September of the year concerned. The annual audit activity report shall be addressed to the Commission, the national authorising officer, and the competent accrediting officer, by 31 December each year. The first such report shall cover the period from the entry into force of this regulation up until 30 November 2007,
  • an annual opinion following the model set out in the framework agreement as to whether the management and control systems functions effectively and con-forms to the requirements of this Regulation and/or any other agreements between the Commission and the Republic of Macedonia. This opinion shall be addressed to the Commission, the national authorising officer, and the competent accrediting officer. It shall cover the same period and have the same deadline as the annual audit activity report,
  • an opinion on any final statement of expenditure submitted to the Commission by the national authorising officer, for the closure of any programme or of any part thereof. Where appropriate, the final statement of expenditure may include payment applications in the form of accounts submitted annually. The opinion on any final statement of expenditure shall follow the model provided in annex to the framework agreement. It shall address the validity of the final payment application and the accuracy of the financial information, and, where appropriate, be supported by a final audit activity report. It shall be sent to the Commission and to the competent accrediting officer, at the same time as the relevant final statement of expenditure submitted by the national authorising officer, or at least within three months of the submission of that final statement of expenditure.

Further specific requirements for the annual audit work plan and/or the reports and opinions mentioned in paragraph (b) may be set out in the sectoral or financing agreements.

With regard to the methodology for the audit work, reports and audit opinions required by this IPA IR, the Audit Authority shall comply with international standards on auditing, in particular as regards the areas of risk assessment, audit materiality and sampling. That methodology may be complemented by any further guidance and definitions from the Commission, notably in relation to an appropriate general approach to sampling, confidence levels and materiality.