lost her job after refusing to refrain from publicly voicing
her perceptions on the flawed state of the EU accounting
Muis has announced that he will leave his post in April 2004,
but in the meantime, his job requires that he continue to challenge shortcomings in EU financial control matters. In November 2003, for example, he was asked to brief the European
Parliament about Eurostat, the EU’s statistical body, and its poor
fiduciary handling of its procurement processes, which was at
the base of a major new scandal within
Muis recently spoke with Internal
Auditor from his office in Brussels,
Your resignation doesn’t take effect
until next April. Why did you give
notice of your intention to leave so far
I needed three years for the IAS to reach
critical mass on the basis of the mandate I received when I came, which was
to build a mature IAS. In this pioneering period, we have had to do quite a
lot of uphill climbing. We are right
in the vanguard of cultural change. Off
and on, we have had good traction, but
also off and on, we have been spinning
our wheels. Now that much of the
tough work is done and the service is
reaching cruising speed, I want to give
it the opportunity to have a different captain, earlier rather than
later. As I stated in writing to the EC, I think it would be good
for the commission, for the service, and for myself to have a different face and a different voice.
The impression one might get from recent developments at
the commission, like the Eurostat scandal, is that it’s the
culture of the EC, as regards financial controls and internal
auditing, that has been very resistant to change. But it
sounds, from what you’ve just said, that you think you’ll have
made enough progress by the end of your term that you can
leave without misgivings.
When I leave, I will probably have achieved 50 percent of what
I set out to do and what I could have done had the EC apparatus been a more willing partner in implementing the Reform
White Paper it adopted some three years ago. And, let me hasten to add that I also would have had to have been more patient
with a culture that has reached its absorption limits of change
to have the other 50 percent.
The Reform White Paper was predicated on the rollout
of The Committee of Sponsoring Organizations of the
Treadway Commission (COSO) concept of controls. It was
thus also predicated on a mature governance construct, under
which you have proper separation between the management
function and the monitoring function, where you have a
mature controller or accountant, and where you have checks
and balances. The commission has made progress on that
score, but it has traditionally suffered from tremendous capacity deficits in controls and auditing.
Therefore, you have to show
patience when the commission
moves more slowly than an idealistic reform paper would suggest.
The barriers are not only resources,
but also, to some extent, the will to
create transparent governance structures. The EC has been progressing;
we are going in the right direction.
But the key question is, are we going
to get where we want to go? And will
we get there by design or principally
by default? The commission still has
quite a way to go before it actually gets
to the end station of what reform was
supposed to be.
There are two distinct reasons for
this. The first is that the EC grossly
underestimated the importance of
the EU’s central accounting system.
That was not part of the original
reform package but became part of it as a result of strengthened controls and also, I have to add, as a result of unsolicited
adverse publicity — an example of change by default rather
The architects of reform may not have recognized a second
element — governance — but I have particularly been emphasizing it. You cannot talk about good controls if you do not
also include the EC’s own governance construct. We have had
very loose reporting lines, if any, from the bottom up. We
have too little feeling of responsibility for controls, top down.
Ownership of horizontal control issues, if any, is fragmented
and fragile. The commission’s accountant traditionally felt
that he had no responsibility for the systemic issues that go
with good controls, anything from the hard-core systems
up to the soft controls, tone at the top, and everything else.
If you don’t feel you have that responsibility, you then lack
the main driver — the leadership that should go with a reform
process of which controls are a particular feature. Leadership
really should start in a reform process with the accountant or
FEBRUARY 2004 INTERNAL AUDITOR