Mr. Brendan Gleeson:

We are an accredited paying agency. Accredited means we had to pass tests and meet standards. Every division has a set of written procedures. We have an internal audit unit that audits this stuff on a regular basis. We report to the Commission and we have this external audit body that looks at us. We have an accreditation review group. I periodically chair a group that makes sure we follow up on audit findings from the EU. In a systematic way, once a quarter, we go through every audit finding we have and make sure every division is following up on those audit findings. We have a very robust governance structure. I would be a foolish man if I said we will have no disallowances next year because there are audits every year, but our objective is to have no disallowances.

In the context of a disallowance, there is quite a complex procedure at EU level. We can make our views known to the Commission, it may or may not agree with us, and there is then a conciliation procedure. We bring our case to the conciliation body. Frequently, and I am certain it was the case in this instance, the Commission will propose a much higher disallowance than the net result and we negotiate it down.