19. Regrets the lack of compatibility between the Court of Auditors' estimation of the most likely error rate based on the annual approach of the Court of Auditors and current methodology, on one hand, and the Commission's practice to refer to the net residual error rate covering more than one year, on the other hand; believes that the approach based on the residual error rate in its current form does not provide comparable data for the annual discharge procedure; notes with satisfaction that the Commission agrees with the Court of Auditors that further quantified evidence should be found; calls on the Commission to complete the proce ...[+++]ss of developing the key indicator to estimate the financial impact of residual error within the set timeframe, i.e. by 2013;

159. Is deeply worried that the calculation of the residual error rate is based on assumptions which do not always hold true in reality such as the 'extrapolation' of errors found in one cost statement to other cost statements of the same beneficiary; shares the Court of Auditors' view that limited reliance ...[+++] can be placed on the residual error rate (Annual Report, point 6.32); believes that this also calls into question the reliability of reservations made by the Director-Generals, as one of the main indicators used for deciding whether to make a reservation is the residual error rate;

19. Regrets the lack of compatibility between the Court of Auditors' estimation of the most likely error rate based on the annual approach of the Court of Auditors and current methodology, on one hand, and the Commission's practice to refer to the net residual error rate covering more than one year, on the other hand; believes that the approach based on the residual error rate in its current form does not provide comparable data for the annual discharge procedure; notes with satisfaction that the Commission agrees with the Court of Auditors that further quantified evidence should be found; calls on the Commission to complete the proce ...[+++]ss of developing the key indicator to estimate the financial impact of residual error within the set timeframe, i.e. by 2013;

The ECA compares the estimated error rate with a materiality limit of 2% to determine – together with other evidence – whether the error is material.

Based on the examination referred to above, it is my opinion that the final statement of expenditure presents fairly, in all material respects, the expenditure paid under the operational programme, that the application for payment of the balance of the Community contribution to this programme is valid and that the underlying transactions covered by the final statement of expenditure are legal and regular, except with regard to the matters referred to at point 2 above and/or to the observations at point 3 regarding the error rates and cases of irregularity and the way they have been dealt with by the managing authority, the impact of whic ...[+++]h is quantified above.

As in previous years, the Court found evidence that the expenditure under the Common Agricultural Policy, viewed as a whole, was still materially affected by errors.