Part-financed by the European Union Eligibility of expenditure Joint Technical Secretariat Information Seminar for Latvian Project Partners Riga, 29 April

Part-financed by the European Union

Eligibility of expenditure

Joint Technical Secretariat

Information Seminar for Latvian Project PartnersRiga, 29 April 2009

2Information Seminar for Latvian Project Partners, Riga, 29 April 2009

Content

1. Budget line specific rules

2. Horizontal rules& Use of the Euro (exchange rate system)

3. Management and accounting tool: Cost itemisation list


Content





Budget line specific rules

BL1 – Personnel

BL2 – External services

BL3 – Travel and accommodation

BL4 – Equipment and investment

BL5 – Other direct costs


project data form

accounting (cost itemisation list)

progress report

0

1

2

3

4

5

TOTAL: 510,000.00 398,358.00

--Other example WP 150,000.00 32,154.00

Example WP 200,000.00 316,546.00

Comm. & Info. 50,000.00 1,647.00

Man. & Admin. 100,000.00 2,313.00

Preparation 10,000.00 45,698.00

(BL1) (BL2)

BUDGET LINES (EUR)

Personnel External servicesWork Packages

BudgetPrevious reports

Current report

Remaining budget

[Euro] [Euro] [Euro] [Euro] [% ] [Euro]

0 Preparation 10,000.00 5,000.00 5,000.00 50.0 5,000.00

1 100,000.00 1,000.00 6,000.00 7,000.00 7.0 93,000.00

2 50,000.00 500.00 1,500.00 2,000.00 4.0 48,000.00

3 200,000.00 0.00 13,000.00 13,000.00 6.5 187,000.00

4 150,000.00 100.00 70,000.00 70,100.00 46.7 79,900.00

5 0.00 - 0.00

510,000.00 6,600.00 90,500.00 97,100.00 19.0 412,900.00TOTAL

Comm. & I nfo.

Example WP

Other example WP

BL 1 - Personnel [ERDF]

Work packageAccumulated

Man. & Admin.

Budget line structure in …



BL1 – Personnel






BL1 – Personnel

• Personnel costs of project staff

– Directly employed by project partners listed in the project data form

– Carrying out project activities

• Documentation by

– Employment/labour contract

– Payslips/other adequate accounting documents

– Time sheets

– Other documents required by FLC


BL1 – Personnel

• Unpaid voluntary work

– Carrying out project activities

– No remuneration at all

– Limit: project partner’s contribution (10%, 15%, 25%, 50%)

• Documentation

– Written agreement

– Time sheets

– Documentation of the work value estimation

– Other documents required by FLC


BL1 – Personnel

• NON-ELIGIBLE

– Any voluntary remuneration and employer contribution

– Unpaid overtime

– Administration costs

– Unpaid voluntary work of project partner’s own staff



BL1 – Personnel







• Expenses paid by project partners to external providers

• Basis:

– Contracts of work, supply contracts, service contracts

– Invoices/requests for reimbursement.

• Public procurement / Bit-at-three rule ! (=> horizontal rules)

• Advance Payments:

– Reported after partial of full delivery only



• NON-ELIGIBLE

– Contracting between project partners

– Contracting of employees of the project partner organisation

– Services provided by another unit of the project partner => BL 1

– Advance payments, which are not based on an invoice


#Start: 1

ERDF paid

NOR paid

ENPI paid

Nat. curr.

Exch. rate

[1 EUR = ?] [EUR]

of it

[national currency]

Payment date

WP & BL

TOTALamount paid

Specification of the invoice

Eligible net

amount

Eligible VAT

Creditor(e.g. registered name of the

supplier)

PP no°

I nternal no°

I nvoice no°

I nvoice date

Reporting period 01/01/2009 End: 30/06/2009 No.

* * * FR_ 2 - Specification of BL 2 'External services' * * *

Project 100 Acronym: TESTproject

project data form

itemisation

list

progress report



BL1 – Personnel







• Travel and accommodation + subsistence allowances

• Essential for project activities

• Most economic way of transport

• Observe national and organisation internal rules!

• Prior approval of travels outside the programme area and the EU!

• Documentation

– Agenda/programme of the meeting/event

– Travel report/equivalent memo

– Original tickets and other original documentary evidence



• NON-ELIGIBLE

– Costs exceeding national/EU limits

– Travel in first/business class except no other option was available

– Subsistence allowance for third persons

– Use of car or taxi if public transport is available



BL1 – Personnel







EQUIPMENT

• Tool/device to carry out project activities

• Not used by project target group after completion of activities

• Depreciation costs only!

INVESTMENT

• Result of project activities

• Used by project target group after completion of activities

• Full costs


* * * FR_ 4 - Specification of 'I nvestments' (BL 4) * * *

#Start: 1

ERDF paid

NOR paid

Nat. curr.

Exch. rate

[1 EUR = ?] [EUR]

of it

[national currency]

TOTALamount paid

Specification of the invoice

Eligible net

amount

Eligible VAT

Creditor(e.g. registered name of the

supplier)

PP no°

I nternal no°

I nvoice no°

I nvoice date

Reporting period 01/01/2009 End: 30/06/2009 No.

* * * FR_ 3 - Specification of 'Equipment' (BL 4) * * *

Project 100 Acronym: TESTproject

project data form itemisationlist

progress report



• NON-ELIGIBLE

– Equipment and investment financed by other financial instrument

– Fully depreciated equipment

– Equipment and investments not listed in the project data form

– Equipment and investments not complying with information and publicity rules



BL1 – Personnel







• ELIGIBLE

– Direct office running costs

– Transnational transfer charges and charges for project account

– Participation fees for external events

• Other expenses

– essential for project implementation

– exist because of the project

– supported by invoices directly attributable to the project/project staff



• NON-ELIGIBLE

– Overheads & other general costs allocated on a percentage or pro rata basis

– National transfer charges

– Exchange rate losses and debit interest

– Awards an prizes

– Expenditure belonging into an other budget line





Content


Horizontal rules

• Rules applicable to all budget lines

• Chapter 5.1.6. of the Programme manual

• Regular updates (Nov 2008)


1. No contracting between project partners

• No contracting for carrying out project activities

• No profit margin

• Cost-sharing Contracting


2. Conflict of interest

• Person involved compromised by family, political etc. reasons

• All necessary precautions to be undertaken


3. Budget flexibility rule I.

BL1 BL2 BL3 BL4 BL5 Total

WP0 Flexibility

WP1 Flexibility

WP2 Flexibility

WPn Flexibility

Total Flexibility Flexibility Flexibility Flexibility Flexibility Total budget

Reallocated amount (cumulated since project start) ≤ 20% or 40,000 EUR, whichever is higher

• NOT POSSIBLE

- Changes of equipment/investment items

- Changes between project partners’ budgets


4. Public procurement

• For PPs from the EU Member States and Norway

- Transparency, equality, objectivity

- Institutional, regional, national and EU regulations

• For PPs from Belarus

- PRAG

- Rule of Nationality, Rule of Origin


5. Bid-at-three rule

• Value of purchase below the institutional, national and Community thresholds

BUT

• Value of purchase above 1,000 EUR excl. VAT

• Collection of 3 offers

• Proper documentation


"BID-AT-THREE" support document

Selected x Selected Selected

Price: Price: Price:

The name of the offerer:



J ustification of the decision

Description of the purchased goods or

servicesOffer no 1 Offer no 2 Offer no 3


6. Publicity rules

• Commission Regulation (EC) No 1828/2006 (Article 8,9 and Annex I)

• Indication of the EU’s participation

• Indication of the BSR Programme 2007-2013

• Recovery of funds unduly paid!


8. Treatment of cash in-flows

2/17/2009

Cash in-flows

Revenues

Charges borne directly by users for the use of goods

and services provided by the project,e.g. tariffs, tolls, fees, rents.

Other cash in-flows

Private and public contributions and/or financial gains that are not considered

as revenues, e.g. sponsoring, government contributions


Examples of cash-in flows

Investments in infrastructure

• Revenues: User fee – fares paid by train travellers

• Other cash in-flows: Government contribution for construction


A. Treatment of revenues

• Project application

• Project implementation

- In the Progress report

- Information to FLC

- Deduction from the eligible expenditure

• Project closure

- Reference period/5 years following the project completion


Revenues in the Progress report

(a) Description [max. 300 characters]

WP:

EUR BSR fund:

* * * FR_ 7 - Revenues * * *

Link to the project

Source of revenues:Amount:

Project partner:


B. Treatment of other cash in-flows

• Public contributions

- NO double financing

- co-financing NOT higher than partner’s contribution

- funding under ONLY one operational programme

• Private contributions

- NOT ELIGIBLE

- e.g. airline company sponsoring air fares of PP


Use of the EURO (Exchange rate calculation)

• All funds in EUR

• Other currency to EUR

• Monthly accounting exchange rate of the European Commission

http://ec.europa.eu/budget/inforeuro/

• When converting 4 digits after the comma

• Chapter 10.4.5. of the Programme Manual


Content

I. Budget line specific rules

II. Horizontal rules& Use of the Euro (exchange rate system)

III. Management and accounting tool: Cost itemisation list


Cost itemisation list

• Management toolkit on the website (under General accounting)

http://eu.baltic.net/Press_corner.3264.html?

• Compulsory

• Adjustments are possible

• For the LP (entire project) and for each PP

Part-financed by the European Union

Eligibility of expenditure

Rostislav ZatloukalAdviser for Audit and Control, Joint Technical Secretariat

Information Seminar for Latvian Project PartnersRiga, 29 April 2009

Documents

Part-financed by the European Union Eligibility of expenditure Joint Technical Secretariat Information Seminar for Latvian Project Partners Riga, 29 April