Accountability for subsidies

We require complete annual accounts, even if we only subsidize part of the activities. These annual accounts must include an overview of income and expenditure (income statement) and the balance sheet:

• Overview of income and expenditure
  The overview of income (received) and expenditure (paid) provides information about the available funds and what they have been spent on. This overview clearly shows the municipal subsidy as income.
• 
  balance sheet The balance sheet provides information about the composition of equity, provisions, and reserves.

The explanatory notes state:

• an explanation and substantiation of the financial results;
• a comparison between the result and the budget submitted with the grant application. With an explanation of the differences, the causes of the differences, and possible consequences;
• information about special income and/or special expenses;
• the changes in reserves (what went in and what came out). With an explanation of where the amount for a reserve comes from and the plans for using the reserve;
• whether the final balance (profit or loss) is determined before or after the changes in the reserve.

The audit focuses on:

• the reliability of the financial reporting and
• the legitimacy of the use of the subsidy provided.

By reliability check, we mean:

• checking whether the financial statements correspond to the actual situation;
• checking whether the financial accountability complies with the requirements set by the municipality in the decision (and appendices) on the granting of the subsidy;
• checking that the content report does not contain any contradictions with the financial statements.

By checking the legality, we mean:

• checking whether the financial accountability complies with applicable laws and regulations;
• verification that the subsidy has been used for the purpose and during the period specified in the subsidy agreement.

We also expect the accountant to:

• determines whether financial management is accessible, reliable, and verifiable;
• Errors that have been identified, that affect the amount of the subsidy, and that can be corrected, will be corrected.
• take irrecoverable errors into account in the opinion of the audit report;
• ensures accurate and complete accounting of co-financing contributions.

The determination of reliability meets the following requirements

• A minimum reliability percentage of 95% is used.
• The extent of the inaccuracies and/or uncertainties is expressed as a percentage of the subsidy received. The following conclusions are applied:
  • onjuistheden < 1%: goedkeurend
  • inaccuracies ≥ 1% and ≤ 3%: with restriction
  • incorrectness > 3%: rejected
  • onzekerheden < 3%: goedkeurend
  • uncertainties ≥ 3% and ≤ 10%: with restriction
  • uncertainties > 10%: withhold judgment
• An explanation of the conclusion if the extent of inaccuracies is ≥1% and/or the uncertainties are ≥3%.

Audit opinion

The auditor records the results of his audit in an audit report. This report also states whether the amount of the subsidy has been spent correctly.

Example of the auditor's statement

The financial statements give a true and fair view of:

• de grootte en de samenstelling van het totale bezit op 31 december <jaartal>
• het resultaat over <jaartal>
• that the financial accountability complies with the general requirements.

We declare that:

• the subsidy has been spent for the purpose and activities for which it was granted;
• the activities are accurately represented in terms of number and scope;
• the conditions set out in the subsidy decision have been complied with;
• in de financiële verantwoording over <jaartal> een juiste vergelijking tussen de jaarrekening en de begroting is opgenomen.

For substantive accountability, the municipality requests an annual report detailing the activities carried out, objectives, and results for which the subsidy was granted. The annual report meets the specific requirements set by the municipality in the subsidy grant decision.

Were certain activities not carried out or targets and results not achieved?

The annual report or a letter accompanying the annual report will then state which results were not achieved and the reasons for this. It will include a description of possible conclusions, solutions, or plans for improvement.