On September 22, 2005, by Resolution of the Mayor of the Ayamonte City Council, the request formulated by the mercantile FADESA INMOBILIARIA SL, to proceed to the constitution of the Urbanistic Entity of Conservation was approved. Subsequently, the Statutes of the EUC Costa Esuri were published in the Official Journal of Huelva number 204 of October 26, 2005.

The EUC was to be governed by the provisions of Law 7/2002 of Urban Planning of Andalusia and by the Regulation of Urban Management R.D. 3288/1978 of 25 August.

The EUC has an administrative nature, legal personality and full legal capacity for the fulfillment of its purposes.

The Entity is registered in the Register of Collaborating Urban Entities of the Ministry of Public Works and Transport of the Government of Andalusia.

Members of the EUC are all the owners of the plots, residential buildings, non-residential facilities of private ownership.

The EUC acts under the Urban control of the Council of Ayamonte, and a representative of the current administration will be part of the Governing Council of the EUC.

The purpose of the EUC is to maintain municipal urban services.

For the fulfillment of its object and purpose, the EUC shall distribute the maintenance costs among all its members in accordance with their coefficient of property.

The Title IV of the Statutes regulates the economic regime of the EUC Costa Esuri.

The Article 40 of the Statutes paragraph 3, states that the accounts and the Annual Accounts shall be kept and obtained on the basis of generally accepted principles defined in the framework of accounting law. And in point 2 it says that the Ordinary Annual Meeting Assembly will approve all or part of the financial statements, as well as the management derived from the administration of the funds of the EUC.

The Article 18 of the Statutes, establishes that the AGM will meet once a year, within the first quarter of the year, in order to censor the common management and approve, where appropriate, the Reports and Accounts for the preceding financial year and the Budgets for the financial year.

The Article 29, concerning the EUC’s Governing Council and its powers, states that it is the specific function of the Governing Council to administer the funds of the EUC, formalizing the Report and the Accounts corresponding to each financial year, which are to be submitted to the General Assembly.

The Article 37, paragraph 3.A), states that it is the function of the Administrator to maintain the administration and accounting of the economic and financial management of the EUC on the basis of generally accepted accounting principles. And in point 3.I), prepare budgets and reports with accountability.

Conclusion: In the Statutes of the EUC Costa Esuri it is provided that the accounts and the Annual Accounts shall be kept and obtained on the basis of generally accepted principles defined in the framework of accounting law, and that the documents to be drawn up by the Governing Council with the assistance of the Administrator are the Budget for the current financial year and the Annual Accounts and Reports for the previous financial year; which must be submitted for approval by the AGM to be held in the first quarter of the year (calendar year) or by the appropriate Extraordinary General Meeting.

Framework of Accounting Law.

In the Accounting Law that establishes the principles and accounting criteria of general acceptance (mandatory) for the recording and valuation of assets, there are two scenarios or fields of application, one the private-commercial, regulated and standardized in the General Accounting Plan with specific adaptations for sectors of activity or companies; and other the public sector regulated in the General Accounting Plan, which governs the accounting of State agencies, Autonomic Communities, Provincial Councils, Town Councils and other public entities.

The General Plan of Public Accounting was approved by Order of the Ministry of Economy and Finance on May 6, 1994, and its implementation by all State Public Administrations has been mandatory since January 1, 1995.

With regard to local authorities, in accordance with article 203 of the Consolidated Text of the Local Finance Act, approved by the Legislative Decree 2/2004 of 5 March 2004, the power to approve the General Accounting Plan under the General Public Accounting Plan was granted to the Minister of Finance, and the Accounting Instructions for Local Entities were approved in 2004.

Over time, amendments and adaptations have been made to Community legislation and international standards.

Order HAP/1781/2013 of 20 September 2013, which approved the Instruction on the Standard Local Accounting Model, currently applies, making it mandatory from 01-01-2015 for accounting for the financial year 2015, laying down the rules for the transition of accounting from 2014 to 2015.

The Normal Model of Local Accounting is applicable to municipalities whose budget exceeds 3,000,000 euros, as well as to those whose population is more than 5,000 inhabitants and the budget exceeds 300,000 euros. The same model applies to self-governing bodies under local authorities.

Each local entity or autonomous body within the scope of the Instruction constitutes an accounting entity.

Let us look at what some rules of Instruction say.

Rule 3 states that: In accordance with the provisions of art. 201 of the Consolidated Text of the Local Finance Act, the entities included in the scope of this Instruction, are required to report to the Court of Auditors (Tribunal de Cuentas) on their operations of any kind. If necessary, it must also be submitted to the external control body of its Autonomous Community.

Rule 6 states that: a) The recording of accounting operations shall be subject to the conceptual framework of public accounting and the recognition and measurement standards set out in Parts One and Two of the Instruction.

Rule 7 states that: Accounting information prepared by local authorities shall be directed to the following recipients: 

To the Plenary of the Local Corporation

To management bodies at the political and administrative level

To the Court of Auditors and external audit bodies of the Contracting Parties.

Bodies of public administrations exercising guardianship functions.

To the creditors of the Entity

To other public and private entities, associations, users of the services provided by the accounting entity and to citizens in general.

Rule 34 states that: Any act or act which, pursuant to the provisions of Title II of the Instruction, is required to give rise to entries in the accounts of the entity must be duly evidenced by supporting documents showing its relationship.

Rule 45 states that: The Annual Accounts that make up the Account of the local entity itself and those that must form each of its autonomous agencies are the following:

The Balance Sheet

The Economic-Patrimonial Result Account

The Statement of Changes in Equity

The cash flow statement

The Budget Clearance State

The Memory

All such accounts shall be prepared in accordance with the rules and models set out in the Instruction.

To the Annual Accounts, they will be added: Statement of assets of cash in Cash at the end of the financial year and Certifications of existence of the balance of the deposits accounts in banks that are owned by the entity.


Conclusion: It is my opinion that if art. 40 of the EUC’s Statutes states that the accounts and the annual accounts shall be kept and obtained on the basis of generally accepted principles defined in the framework of accounting law, the documentation submitted by the Governing Board and the Administrator as the Annual Accounts of the EUC Costa Esuri does not comply with the requirements contained in the instruction on the standard local accounting model, regardless of the veracity and justification of the amounts contained in the documents which would be the subject of an audit report.

The objective of the Annual Accounts is to show the faithful image of the assets, the financial situation, the economic result patrimonial and the execution of the budget of the accounting entity.

The information in the Annual Accounts should meet the requirements of clarity, relevance, reliability and comparability.

For the information to be reliable, it must be complete and objective, and it must be prudent in the estimates and valuations to be made under conditions of uncertainty.

The accounting principles to be taken into account are: continuous management, accrual, uniformity, prudence, non-compensation, materiality, budgetary allocation, disconnection, correlation of revenue and expenditure, the recording or accounting recognition of transactions, the purchase price.

The elements of the annual accounts are assets, liabilities, equity, income and expenses, receipts and payments.

The EUC’s Governing Council should be urged to ensure that the Budget and the various documents forming the Annual Accounts are drawn up and formulated in accordance with generally accepted accounting principles defined in the public accounting law of local authorities, and the administrator is required to keep the accounts in the form prescribed by the Instruction for the Standard Local Accounting Model and the Annual Accounts are formulated in accordance with the models approved in that instruction.

Autor: F. Tapia

10 mayo 2021


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