The Internal Audit and Investigations Department includes the EU Funds Audits Directorate, appointed as the official Audit Authority for EU funds and the Certification Body for EU Agricultural Funds in Malta. This designation is stipulated under Article 123(4) of Regulation (EU) No. 1303/2013, which mandates that each operational program is overseen by an audit authority functionally independent from the managing and certifying authorities.

Article 124 of Regulation (EU) No. 1303/2013 lays down the procedures for the designation of the Managing Authority and the Certifying Authority.  The designations are based on a report and an opinion of an independent audit body that assesses the fulfilment by the authorities of the criteria relating to the internal control environment, risk management, management and control activities, and monitoring.  

The Directorate is responsible for monitoring a diverse array of EU funding programs which are instrumental in supporting the implementation of EU policies and objectives. These include, but not limited to, Agricultural Funds, EU Regional Policy, Employment, Social Affairs and Inclusion, European Territorial Cooperation (INTERREG), Fisheries, and Next Generation EU (NGEU) aimed at fostering Post-COVID Recovery, Health, Sustainable and Digital Transition. Additionally, it covers Migration and Border Management, as well as Security and Defence, ensuring comprehensive oversight and rigorous audit standards across multiple domains.

The Audit Authority is tasked with providing reasonable assurance on the completeness, accuracy, and veracity of amounts declared in the accounts, in accordance with Article 137 of Regulation (EU) No. 1303/2013. In this regard, the Audit Authority undertakes a range of critical activities. These include developing and annually updating an audit strategy to guide all audits, as deduced by paragraph 4 of Article 127 of Regulation (EU) No. 1303/2013. Additionally, this Directorate also performs systems audits as stipulated in the same article to evaluate internal controls and conducts audits on operations to ensure operational compliance. Moreover, the Audit Authority carries out follow-up audits on both system and operational audits to ensure resolution of issues. It also performs detailed financial audits to meet the requirements of Article 137 of Regulation (EU) No. 1303/2013 and compiles Annual Control Reports, summarizing findings and enhancing transparency.

The Audit Authority is rigorously audited by both the European Commission and the European Court of Auditors to ensure compliance with EU funding regulations. In addition to these, bilateral meetings with these respective bodies are conducted to facilitate direct communication and address any specific issues or concerns. These processes ensure transparency and proper management of EU funds.