REPORT on the nomination of Iliana Ivanova as a Member of the Court of Auditors

PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

on the nomination of Iliana Ivanova as a Member of the Court of Auditors

(C10-0123/2024 - 2024/0804(NLE))

(Consultation)

The European Parliament,

- having regard to Article 286(2) of the Treaty on the Functioning of the European Union, pursuant to which the Council consulted Parliament (C10-0123/2024),

- having regard to Rule 133 of its Rules of Procedure,

- having regard to the report of the Committee on Budgetary Control (A10-0018/2024),

A. whereas, by letter of 9 October 2024, the Council consulted Parliament on the nomination of Iliana Ivanova as a Member of the Court of Auditors;

B. whereas Parliament's Committee on Budgetary Control then proceeded to evaluate Iliana Ivanova's credentials, in particular in view of the requirements laid down in Article 286(1) of the Treaty on the Functioning of the European Union; whereas in carrying out that evaluation, the committee received a curriculum vitae from Iliana Ivanova, as well as the replies to the written questionnaire that she had been sent;

C. whereas the committee subsequently held a hearing with Iliana Ivanova on 21 November 2024, at which she made an opening statement and then answered questions put by the members of the committee;

1. Delivers a favourable opinion on the Council's nomination of Iliana Ivanova as a Member of the Court of Auditors;

2. Instructs its President to forward this decision to the Council and, for information, to the Court of Auditors, the other institutions of the European Union and the audit institutions of the Member States.

ANNEX 1: CURRICULUM VITÆ OF ILIANA IVANOVA

Iliana Ivanova

Born on Sep 14th, 1975 in Stara Zagora, Bulgaria

Professional experience:

2023 - until now - European Commissioner, responsible for innovation, research, culture, education and youth

2013 -2023 Member of the European Court of Auditors (ECA)

• Dean of ECA audit Chamber II (three terms, 2016-2022) Responsible for the overall coordination of the audit tasks in the field of the regional, social and cohesion policy

• Chair of the ECA's Audit Quality Control Committee

• Chair of the Professional Standards Committee within the International organisation of supreme

audit institutions (INTOSAI)

• Member of the ECA audit Chamber II (Investment for cohesion, growth and inclusion). Rapporteur for 27 assignments including on topics such as regional development and cohesion, Youth Employment Initiative, Youth Guarantee, EU digital agenda, digital skills, education, as well as the instruments for the EU response to the COVID crisis - SURE, REACT-EU

2009 - 2012 Member of the European Parliament

• Vice-chair of the Committee on Budgetary control (CONT)

• Vice-chair of the special Committee on the financial, economic and social crisis (CRIS)

• Vice-chair of the EU-China Delegation

• Member of the Committee of Internal market and consumer protection (IMCO)

• Substitute member of the Committee of economic and monetary affairs (ECON)

2007 - 2009 Member of Sofia City Council

2004 -2006 Investment and business analyst in various financial and banking institutions in the USA

1999 - 2002 Coordinator for international financial institutions in the Bulgarian Ministry of Agriculture and Food

Education:

1998 Bachelor's degree in international economic relations, University of economics, Varna, Bulgaria

1999 Master's degree in international economic relations, University of economics, Varna

2004 MBA in global management, Thunderbird School of Global Management (Arizona State University), Arizona, USA

Foreign languages: English, French, German

ANNEX 2: ANSWERS BY ILIANA IVANOVA TO THE QUESTIONNAIRE

Questionnaire for Candidates for Membership of the Court of Auditors

Professional experience

1. Please list your professional experience in public finance be it in budgetary planning, budget implementation or management or budget control or auditing.

I have over 22 years of professional experience taking up different positions in the public and private sector related to financial management, auditing and reporting. I have served the European Union since 2009, with a focus on budgetary management from legislative, executive and budgetary control perspective. From the very start of my career, I was dedicated to matters of financial management, auditing and reporting.

Initially, at national level, I spent 3 years as the lead expert in charge of international financial institutions at the Bulgarian Ministry of Agriculture and Food. I was Coordinator for international financial institutions since 1999 and my key responsibilities included managing the relations between the Ministry and the World Bank, the International Monetary Fund, and the EBRD.

After completing with Honors a second master's degree in international management and finance in Thunderbird School of Global Management (Arizona State University), Phoenix, AZ, USA, I continued my professional career in the private sector as investment and business analyst in various financial and banking institutions in the USA.

My strong involvement in budgetary control matters continued when I became member of the European Parliament (EP) in 2009, full member and Vice-Chair of the Committee on Budgetary control (CONT). I worked as rapporteur on a number of dossiers in CONT: 2010 European Investment Bank (EIB) annual report, Regulation on Hercule III Programme to promote activities in the field of the protection of the European Union's financial interests, Regulation on the financing, management and monitoring of the Common Agricultural Policy, Opinion on innovative financial instruments in the context of the next multiannual financial framework, Study on the liability of the European Union budget concerning the EFSM and the ESM and interference on budget control by the European Parliament, Working document on Special Report 11/2009 of the ECA on the sustainability and the Commission's management of the LIFE-Nature projects, Study on pre-accession financing for Bulgaria and Romania: What lessons can be learned for future enlargements. In addition, I was involved in the annual discharge procedure process as shadow rapporteur. (Commission 2009, European Parliament 2010, ECA reports for 2010 Commission Discharge).

In 2013, I was appointed as Member of the European Court of Auditors (ECA). Upon my arrival, I joined Chamber II, where I served from 2013 to 2022. During this period, I was rapporteur for 13 special reports, 4 reviews and 3 opinions. In addition to these publications, I was also reporting Member for the Chapter on employment and social affairs of the ECA's annual report for three years (2012-2014), the Chapter on Cohesion and social inclusion for two years (2015-2016), as well as for the follow up of two Chamber II special reports within the follow up exercise of the 2012 Annual Report. All together I was responsible for 27 ECA assignments. From 2016 until 2022 I was elected 3 consecutive terms Dean of Chamber II, responsible for the overall coordination of the audit tasks in the field of regional, social and cohesion policy.

As of 2022 I became Chair of the ECA's Audit Quality Control Committee and Chair of the Professional Standards Committee of the International Organization of Supreme Audit Institutions (INTOSAI).

In 2023, I was nominated by the Bulgarian government as European Commissioner for Innovation, Research, Culture, Education and Youth. Over this past year I have constantly strived for the policies under my portfolio to deliver value for money, incorporating my significant experience from budgetary control perspective.

2. What have been your most significant achievements in your professional career?

My first most important professional achievement was to put in place prudent and credible practices related to the process of monitoring and reporting on large restructuring loans for the public sector in Bulgaria. Within my responsibilities at the Bulgarian Ministry of Agriculture, I took part in the preparation, negotiations and completion of one of the most significant projects to support the country's Balance of payments - the 50 million USD agricultural sector adjustment loan ASAL II. The project aimed at supporting major reforms in the Bulgarian agricultural sector. At a time when Bulgarian ministries were still building strong administrative capacity, the importance of such projects went way beyond the financial management of an adjustment loan. The purpose of these instruments was to implement the necessary fundamental reforms that made it possible for Bulgaria to join the EU and be prepared to manage European funds. The project was completed successfully and contributed to improving the competitiveness of the Bulgarian agricultural sector.

As a Member of the European Parliament, I would point out the successful adoption of my report for the EIB activities in 2010. The report stressed on the crucial role of the EIB as the "European" bank expected to be one of the significant instruments to help Europe come out of the financial, economic and social crisis. Recommendations pointed out to important aspects of EIB's activities aimed at improving transparency and efficiency of funding for SMEs through establishment of clear performance indicators, strengthening the control mechanisms to measure the effectiveness of external lending and the specific and important role of financial instruments that need to be better measured through the establishment of relevant benchmarks and further explained to the European taxpayers.

As a Member of the European Court of Auditors, I was rapporteur for numerous ECA publications, but I would highlight in particular the series of reports that we published under my leadership on youth unemployment and the implementation of the Youth Guarantee, this work has had a significant impact on policy makers in the field and delivered tangible results that improved the design and reporting arrangements for the proposed actions; as well as two special reports on SURE and CRII/CRII+/REACT EU, which examined the EU's initial reaction following the COVID-19 pandemic break-out in March 2020.

Following my appointment as Chair of the ECA's Audit Quality Control Committee, I took on the responsibility for the Court's overall audit methodology and the quality control review of all documents related to the Recovery and Resilience Facility (RRF). This is particularly important, as selecting relevant audit topics is prerequisite for producing a good special report, but it is equally important to deliver unambiguous messages and clear recommendations, fully in line with the international auditing standards.

I am proud and grateful for being elected three times Dean of Chamber II where thanks to the great work of many different colleagues and the hard work of our staff, a number of excellent special reports, opinions and reviews have been produced, along with the significant contributions to the relevant chapters for the Annual report.

My most recent achievement is being appointed European Commissioner for Innovation, Research, Culture, Education and Youth. I embarked on this role for the remaining last year of the Commission term, and I put as my primary objective to be the guardian of efficient investments in all areas, related to my portfolio. During this short period, I undertook several measures related to simplification, streamlining of processes and oversaw the important evaluations of the programs that will help to prepare better for the ones to follow.

3. What has been your professional experience of international multicultural and multilinguistic organisations or institutions based outside your home country?

Throughout my whole professional career, I have had significant exposure to international and multicultural environments.

For example, as Coordinator for the international financial institutions for the Ministry of Agriculture and Food in Bulgaria from 1999 to 2002, I was the lead expert for the relationship with the World Bank, the International Monetary Fund and the EBRD, as well as for the bilateral relations with several Member States of the EU.

Being Member of the European Parliament from 2009-2013, I was also Vice-chair of the EU-China Delegation. This experience broadened further my multicultural exposure.

As a Member of the European Court of Auditors for the period 2013-2023 I have led many multi-national and multi-cultural teams, especially with my latest assignment as Chair of the Professional Standards Committee, I had the pleasure and honour to represent the ECA at the 24thINTOSAI congress where supreme audit institutions (SAIs) from the whole world meet and discuss how to tackle the common challenges we face, related to improving the control over public finances. We engaged with Presidents of the SAIs worldwide in adopting the Strategic Development Plan for the INTOSAI Framework of Professional Pronouncements.

As European Commissioner 2023-2024, I had the honour to the represent the Commission in many High-level dialogues with partners from the whole world, including G-7 ministerial meetings. I led a significant number of successful discussions and negotiations related to the association for Horizon Europe Program with many international partners such as the UK, Canada, Switzerland, Japan, South Korea and others.

4. Have you been granted discharge for the management duties you carried out previously, if such a procedure applies?

Yes, I have been granted discharge as European Commissioner by the European Parliament within the 2022 Discharge procedure.

5. Which of your previous professional positions were a result of a political nomination?

My nomination as European Commissioner was made by the Bulgarian Government in 2023 in accordance with the Treaty on European Union (TEU).

Before this, I have also been nominated by the Bulgarian Government as Member of the ECA in accordance with the TFEU.

I was elected Member of the European Parliament in 2009. (2009-2012)

Since 2013, I am not a member, and I do not hold a function in any political party. I have kept the highest standards of professionalism, independence and integrity while exercising all my duties.

6. What are the three most important decisions to which you have been party in your professional life?

• As European Commissioner for Innovation, Research, Culture, Education and Youth I am proud to have expanded the openness of Horizon Europe program to new international partners. The association to one of the most prestigious public funding programs for research and innovation in the world brings a win-win for excellence in research where joint efforts can meet better the common challenges before our societies. This decision to open up for new partners has triggered additional interest from other like-minded countries and today we have 19 associated partners and participants to Horizon Europe such as individual researchers, universities or consortia from almost 180 countries.

• As Member of the ECA, as well as Member of its Administrative Committee, I have taken part in many important decisions related to the leading of special reports, the management and functioning of Chamber II and actively engaged in Court activities. Some of the most important decisions in which I was involved were related to the COVID response legislation and the emergency with which all institutions had to react in order to provide quickly adequate response to the crisis. I led a few audit tasks that were done in extremely tight deadlines but provided useful analysis on the legislation adopted and raised early warnings about potential red flags for the future. These were the ECA Opinion 3/2020 on specific measures to provide exceptional flexibility for the use of the ESIF in response to the COVID-19 outbreak; ECA Opinion 4/2020 on CRII+/REACT-EU.

• Another important flagship decision during my time in the ECA was the leadership of series of reports on Youth unemployment. This topic is close to my heart as our youth are the future of Europe. We established a holistic plan for a series of audit reports relating to the different EU instruments aimed at helping EU youth employment. Thanks to our recommendations, actions were taken to improve the definition of "good quality" offer for young people that were not in employment, education, or training. To maximise the effects of our audit conclusions and recommendations, I have initiated several high-level events on the topic to raise awareness and discuss with key stakeholders at EU and national level on how to make these instruments a success story (ECA Conference in the European Parliament "Youth employment - Confronting challenges and finding solutions", Joint ECA-Bulgarian National Audit Office round table on youth employment). I also joined the Members of the CONT Committee during their fact-finding visit to Italy on the topic of youth employment schemes.

Independence

7. The Treaty stipulates that the Members of the Court of Auditors must be 'completely independent' in the performance of their duties. How would you act on this obligation in the discharge of your prospective duties?

Being independent from any influence that might compromise the Court's professional judgement is one of the core values of the ECA. If approved as a Member of the Court, I will continue to serve the European Union in an unbiased and impartial manner.

Throughout my 10 years as a Member of the ECA, and in all my other functions, I believe I have proven not only in words but also in action that I have always been guided in my work by the best interest of the European taxpayers. I also always exercised my work with integrity, professional judgment and independently from any external influences, following the professional auditing standards and the principles set out in the Lima and Mexico declarations.

With regards to my last role as European commissioner, I will make sure that if approved by the EP, I do not engage in any audit activity or Chamber related to the portfolio I was responsible for.

8. Do you or your close relatives (parents, brothers and sisters, legal partner and children) have any business or financial holdings or any other commitments, which might conflict with your prospective duties?

No.

9. Are you prepared to disclose all your financial interests and other commitments to the President of the Court and to make them public?

Yes. My financial interests and commitments have been public since 2009 and I will disclose them also in the future, as required by Article 14 of the Code of Conduct for the Members and former Members of the Court.

10. Are you involved in any current legal proceedings? If so, please provide us with details.

No.

11. Do you have any active or executive role in politics, if so at what level? Have you held any political position during the last 18 months? If so, please provide us with details.

I was appointed as European Commissioner for Innovation, Research, Culture, Education and Youth in September 2023. This role will be terminated before the end of 2024. I do not hold any political party membership or function.

12. Will you step down from any elected office or give up any active function with responsibilities in a political party if you are appointed as a Member of the Court?

Since 2013 I have not been member of any political party. My role as European Commissioner will end before the end of 2024.

13. How would you deal with a major irregularity or even fraud and/or corruption case involving persons in your Member State of origin?

The Treaty of the functioning of the European Union Article 285 stipulates that the Members of the ECA shall be completely independent in the performance of their duties. I see the impartiality in the decision-making processes as indispensable for the exercise of Members' duties. I would follow the rules provided for such type of cases in the ECA procedures no matter in which country an irregularity, fraud, or corruption case had occurred.

I would react in accordance with Article 2 of Decision 99-2004 of the ECA by communicating without delay the information to the Member responsible, and to OLAF, or to EPPO, depending on the nature of the case, related to the jurisdictions of OLAF or EPPO.

I see the role of the Court as the guardian and defender of the interests of all EU taxpayers. The Treaty obligations in Article 287 of TFEU clearly state that all revenue and expenditure of all accounts should be examined for legality and regularity of the underlying transactions, and checks should be made whether financial management has been sound.

In all my previous work I have adhered to and applied these principles and if confirmed, I intend to continue to do so. I would treat any Member State the same way when suspected of fraud or any other illegal activity, and any different approach would be unacceptable for me.

Performance of duties

14. What should be the main features of a sound financial management culture in any public service? How could the ECA help to enforce it?

The many crises which the European Union has faced over the past 15 years proved that the sound financial management at national and EU level is of utmost importance for the good functioning of public services. In times when public trust in institutions is weakening, it is even more relevant to ensure transparency and accountability for the European taxpayer.

The Financial Regulation sets three principles for a sound financial management, the 3Es - economy, efficiency and effectiveness. Article 33 from the Regulation stipulates that "economy" means that the resources used for an activity shall be made available "in due time, in appropriate quantity and quality and at the best price". The principle of "efficiency" establishes the best possible ratio between the resources used for the results achieved. The "effectiveness" ensures the achievement of the set objectives and results.

To adhere to these principles, I believe it is important to consider proper planning and budgeting, followed by transparency in reporting, developing robust auditing processes and accountability, involving adequate management of revenues and costs, and identifying the potential risks that could hamper the outputs and results.

The ECA has invested many resources and ideas into improving the quality, relevance and timeliness of its special reports in the past years. Of course, processes can always be further refined to bring more added value. I believe the ECA can and should contribute to fostering the sound financial management culture by continuing its strive to deliver special reports that address critical areas of EU spending, targeting carefully the scope, keeping the 13 month deadline for publication and providing clear and relevant recommendations, such that can be easily measurable and followed up.

15. Under the Treaty, the Court is required to assist Parliament in exercising its powers of control over the implementation of the budget. How would you further improve the cooperation between the Court and the European Parliament (in particular, its Committee on Budgetary Control) to enhance both the public oversight of the general spending and its value for money?

The relationship between the European Court of Auditors and the European Parliament is clearly defined in Article 287 of the TFEU. The ECA plays an important role in providing the European Parliament with relevant and systematic information about the implementation of the EU budget. I see this requirement not only as an obligation as per the Treaties but also as an important need and a natural process for the crucial roles that both institutions play in protecting EU's financial interests.

The constant dialogue between the ECA and the EP, and the Committee on Budgetary Control in particular, has a very high added value for me. Both the Court and the Parliament play their respective roles in monitoring and exercising the necessary control on the EU budget. The ECA provides the expert input and information to the EP which takes the political decisions, based on the analysis and recommendations provided by the Court.

What I find particularly important, with the beginning of a new parliamentary term, is that the ECA creates a strong connection and engages with CONT members with regards to all areas of ECA's work. If I am approved by the CONT Committee as member of the ECA, I would spare no effort to work on continuing and further strengthening the excellent relationship with CONT.

The process of communication is very important and while the ECA is an independent institution, I believe that good coordination with CONT and the EP will contribute to better targeting the priority areas for audits and thus will provide Members of CONT with relevant information in specific areas of interest in a timely manner.

If confirmed, I would listen carefully to your comments, concerns and suggestions. I believe keeping good contact with the Chair, vice chairs, the coordinators and with the individual members, as well as their teams is crucial for enhancing the cooperation between both sides.

16. What added value do you think performance auditing brings and how should the findings be incorporated in management procedures?

According to the INTOSAI implementation guidelines for performance auditing, the main objective of performance auditing is to constructively promote economical, efficient and effective governance. It also contributes to accountability and transparency.

The added value of this reporting is becoming increasingly important due to the growing need for informed decision-making and the complexity of the financial landscape. As explained earlier in my previous answers, through the 3Es the auditors provide objective assessment whether:

- The resources are optimally used, be it in due time, quality and quantity and at most economical cost.

- Through the available resources a maximum output is achieved. The evaluation looks at the link between resources and output.

- The achieved results meet the initial objectives.

In this respect, performance audits can help decision makers to make informed choices through an evidence-based analysis and clear recommendations how to address deficiencies. With timely and relevant recommendations that are applied consistently, decision makers can improve processes, optimise and streamline procedures that could lead to savings and better value for money. Performance audits could highlight and promote good practices.

They can play an important role also in the prevention and crisis management as through identifying areas of underperformance or potential risks, they could point out and mitigate issues before they escalate. All these elements could ultimately improve policy developments in a continuous and sustainable way. I believe that through performance auditing we contribute significantly towards building a stronger trust from the stakeholders and taxpayers.

For the future, I see these elements gaining even a greater role in the context of new funding models linked to performance. The challenge for the SAIs would be to quickly address these emerging needs by developing methods and practices that would allow with the limited resources available to address in a flexible way the growing demands for areas to be audited. I would underline the role of digitalisation and AI that could help optimize some processes but in the performance assessment it is critical to keep a human-centred element in the evaluation as it goes beyond standard compliance checks.

17. How could cooperation between the Court of Auditors, the national audit institutions and the European Parliament (Committee on Budgetary Control) on auditing of the EU budget be improved?

As guardians of the control over public funding, all three types of institutions are committed to protecting the taxpayer's interest and thus enhancing the trust of the citizens. Besides the complexity of the financial landscape there are a number of emerging challenges such as new priorities resulting from geopolitical tensions, crises and wars near the EU borders that require even closer cooperation between the institutions that share the same goal. The increasing risks before the EU public spending will require even more and faster joint efforts to provide timely and adequate responses to these challenges making sure that the funding reaches beneficiaries as quickly as possible, to achieve its intended goals, however without any compromise to the rules. Today, still more than 80% of the EU programmes are subject of shared management between the European Commission and the Member States, therefore a good partnership between the European and national level is key.

I believe that in this context the ECA could have a central and very active role as it has the CONT Committee as a main counterpart in the EP and keeps the important relations with the national SAIs within the Contact Committee. We have already many good examples of bilateral cooperation with SAIs on specific audit topics. During my time in the ECA, I have led a series of audits on youth unemployment and youth guarantee that have served as a basis for a fruitful exchange with national SAIs, led to the organisation of joint conferences and sharing of good practices.

The relationship with the CONT committee is regular and of prime importance not only because of its role for the discharge procedure but also regarding all special reports, opinions and reviews that the Court issues.

It is possible to find an intersection point between these different relationships when there is a common topic, a common challenge that everyone is facing and looking for ways to address. I would recall from my experience as Chair of the Audit Quality Control Committee that one such common subject was the auditing of the Recovery and Resilience Facility. From all perspectives, for all of us this was a new subject and sharing experiences was very much sought and proved to be very useful. The role of the ECA could be to help identify such common subjects and facilitate organising joint meetings, conferences or workshops where knowledge and ideas could be shared; that would lead to our common better understanding of the problems with the aim of improving our efficiencies and optimising the use of resources.

18. How would you further develop the reporting of the ECA to give the European Parliament all the necessary information on the accuracy of the data provided by the Member States to the European Commission?

I find it of utmost importance to ensure that the European Parliament receives most accurate and relevant data needed for its decision making. And the ECA plays an important role in providing strong audit assurances for this process in an even more challenging and changing environment. This is also one of the main goals in ECA's audit strategy.

Members states provide data to the Commission through many different national databases, business and tax registers and public procurement platforms. The responsibility whether this data is correct and reliable lays first on the Commission which in turn has a complicated mix of IT systems and datasets. The ECA has continuously recommended for simplification and improvement of this data accuracy.

Clearly, one way to address this gap is though digitalisation of the shared management approach. It could provide more standardisation through common definitions and concepts as well as more extensive use of emerging technologies, including AI; data sharing among the entities involved in the management of EU funds could also bring more efficiency in the process. It is also important to note that the benefits of digitalisation would work only if all parties in the process are committed to it and take active part in its implementation, otherwise the effect would be as weak as its weakest link.

The Court has advocated strongly for relying more on digital audits while fully realising that the digitalisation and standardisation of IT tools and data governance are not equally advanced in all Member States.

I strongly believe that the ECA should continue to focus its efforts on further promoting the benefits of digitalisation for the transparency and protection of the EU budget.

Other questions

19. Will you withdraw your candidacy if Parliament's opinion on your appointment as Member of the Court is unfavourable?

Yes.

ANNEX: ENTITIES OR PERSONS FROM WHOM THE RAPPORTEUR HAS RECEIVED INPUT

Pursuant to Article 8 of Annex I to the Rules of Procedure, the rapporteur declares that he has received input from the following entities or persons in the preparation of the report, prior to the adoption thereof in committee:

The list above is drawn up under the exclusive responsibility of the rapporteur.

Where natural persons are identified in the list by their name, by their function or by both, the rapporteur declares that he has submitted to the concerned natural persons the European Parliament's Data Protection Notice No 484 (https://www.europarl.europa.eu/data-protect/index.do), which sets out the conditions applicable to the processing of their personal data and the rights linked to that processing.

INFORMATION ON ADOPTION IN COMMITTEE RESPONSIBLE