Financial Requirements
BMW Regional Assembly
17th May 2012
Outline
1.
2.
3.
4.
5.
6.
7.
Role of Lead Partner & Project Partners in Financial Management
Financial Reporting
Expenditure Claims
Eligibility of Expenditure
First Level Control
Preparatory Costs
Legal Requirements
Devolved legal and financial responsibility
The Lead Partner
• ensures sound management and the delivery of outputs
• drafts the Partnership Agreement, establishing mutual rights, obligations
and duties among project partners.
• ensures that expenditure is eligible, even if partners remain liable for their
own actions and related expenditure
• is responsible for reporting and other administrative actions to the JTS
• distributes ERDF to partners.
The BMW Regional Assembly (LP) will be responsible for ensuring copies of
all documentation are available for audit, to assist with this all partners will
be required to forward copies of all invoices, timesheets etc to LP when
submitting claim (scanned, microfiches accepted or hard copy).
Claims will be required by JTS on 30th April and 31st October each year, these
dates are non-negotiable.
In order that LP may meet these deadlines it will be necessary for Project
Partners (PP) to submit certified claims by mid-February and mid August
each year
Project Partners
• Prepare eligible expenditure claims for validation (FLC)
• Assume responsibility for any financial corrections arising from
expenditure already declared
• Retain all original documentation up to 31st December 2021
• Ensure adequate internal controls and procedures
• Co-operate with second level controls (audits)
• Designate a financial control contact person to liaise with LP Financial
Manager
Partnership Agreement
Lead Partner Principle
Overall responsibility
project implementation:
project content + financial
management
Responsibility for Project
Management
• Signature of Subsidy Contract
• Transfer of received ERDF funds
to partners
• Organisation of audit of all
expenditure
Contact with JTS
Submission of progress
reports, payment
claims, audit reports,
project modifications,
day-to-day questions…
Implementation stage
• Joint implementation: activities must be carried out and coordinated
by all partners.
• Reporting and monitoring: jointly, timely, activities + expenditure.
Progress Reports make a link with the Application and the Payment
Claim.
• First Level Control and control regulations: national rules apply
• Payments: the principles of post-reimbursement, the time lag
between expenditure and reimbursement and the grant rate must be
clear.
• Irregularities / recoveries: prevention is better than cure
• Decommitment issues: information plays a vital role!
Partner Claims
All partners submitting claims should ensure the following are forwarded to Lead
Partner in either hard or soft copy.
1.
2.
3.
4.
5.
6.
7.
8.
9.
Completed Partner Claim
Detailed Verification Sheet
Signed FLC Certificate
Copies of all Invoices, timesheets etc
Completed Expenditure Forecast for next 6 months
Progress reports will be required with each claim
April Claim will be accompanied with the long version Progress Report
October Claim will require short version Progress Report
Each claim should include:
i. Completed claim form
ii. Detailed Verification Sheets - full schedule of costs incurred
iii. Signed FLC Declarations for all partners
General considerations: the big picture
 EU regulations in general, esp. General Regulation 1083/2006.
 Regulations (EC) 1080/2006 and 1828/2006
Regulations (EC) 846/2009 amending Regulation 1828/2006
 Public procurement rules
 State aid
 Country specific eligibility rules (Wallonia, Ireland…)
 NWE Guidance notes
Eligibility Period
Start Date
Costs are eligible from the start date indicated on the Application Form ,
(1st January 2011), at the earliest one year prior to the closure of the call
for proposals as long as the actions have not been completed before that
date
End Date
The end date indicated in the Application Form, (31st May 2015) is the
date by which the final report should be submitted to the Secretariat.
NB
Any expenditure (including costs linked to the project closure) incurred,
invoiced or paid after the official project end date is ineligible.
Eligibility of Expenditure
Partner Staff
• Staff costs are the costs of the actual time worked by persons
directly carrying out the work under the project and directly
employed by the partners
• Partner time claimed must be supported by timesheet. It is
the preference of the JTS that such timesheets show all time
worked and not just time appropriate to project.
• Daily/hourly rate claimed should be supported by rationale
applied for calculation of such rate.
External Expertise
• Work done by independent consultants must be essential to the project
and be reasonably priced (limited to €800 per day)
• Costs must be paid on the basis of contracts/invoices – it is the Partner’s
responsibility to ensure that public procurement rules are respected
• Travel and accommodation expenses for external experts should be
recorded under the external expertise budget line.
• Exceptions such as website development or communications should be
recorded under the “Publicity” budget line, all audit costs are recorded
under the “Audit/First Level Control” budget line
Travel & Accommodation
• Only certified, paid expenses should be included
• Claims should be supported by copies of tickets, receipts,
invoices etc as appropriate.
• Costs must be directly related to and essential for the
effective delivery of the project and cover economy class
travel on public transport.
• National guidelines for payment of Travel & Subsistence will
apply.
• Payments must also be consistent with organisational
rules/rates
Meetings & Seminars
• Costs related directly to the organisation of meetings and
events, i.e. renting premises, hire of equipment, provision of
meals etc.
• Participation in meetings and seminars related specifically to
the project should be charged to this budget line.
• Related travel costs for external experts must not be claimed under this
budget line, this should be charged to the appropriate specified budget
line, i.e. External expertise, publicity, audit.
Publicity
• Expenditure with the main aim of promoting the Project
should be part of this cost category. This should include
website, promotional material and printed publications.
• Public Procurement rules must be observed in selecting
company or individual who will carry out the assignment.
Equipment
• Durable equipment charged to the project must be essential for the
delivery of the project and used for that purpose.
• Depreciation rules will apply to all equipment charged to the project.
Depreciation will be made in accordance with the internal accounting
rules of the partners .
• Only the portion of the equipment’s depreciation corresponding to the
duration of the project and the rate of actual use for the purpose of the
project may be taken into account.
• Goods purchased prior to the start of the project may be claimed at a
depreciated rate as long as they have not previously been financed by any
other source.
Audit Costs
• Audit costs are those related directly to any audits /First Level
Control checks carried out on project. All invoices must be
paid prior to period close date.
• Any expenditure incurred in relation to closure which has not
been paid cannot be claimed.
• To maximise expenditure it will be acceptable to obtain a ProForma invoice from your First Level Controller for the final
claim which should be paid prior to period end date to allow
for inclusion in final claim
Administration Costs
Administration costs include items such as office rent,
maintenance and furniture, electricity, heating, water,
insurances, telephone, fax, internet, stationery and other
administrative structure costs.
Since April 2011 a flat rate of 11% of Partner Staff will be
automatically applied for administration costs
Preparation Costs
Preparation costs may be claimed in relation to:
• Costs related to project development and application
• Activities must show a direct demonstrable connection to the development of
the project
• Costs must have been incurred and paid after 1st January 2011, all expenditure
incurred prior to this date is deemed to be ineligible
• They may include costs under all budget lines and are limited to a ceiling of
€100,000 in total eligible costs, for the entire project.
• Preparation costs must be claimed by all partners together.
It is proposed that Claim 1 to be submitted in October 2012 will include
Preparation Costs only.
Ineligible Expenditure
•
•
•
•
•
National banking charges
VAT – unless it is genuinely and definitively borne by the final beneficiary
Fines, financial penalties and expenditure on legal disputes
Interest on debt
For partners from the NWE area, any expenditure incurred outside the
eligible area (for example, costs of a meeting or conference held outside
the area) must be justified in full and a clear need for the expenditure to
be incurred in the area must be demonstrated
• In-kind contribution can only be included in Payment Claims if it was
included in the Approved Application Form attached to the Subsidy
Contract
Payment Claim
• Partners should agree a reasonable timeframe with
their First Level Controllers, having regard for the
timeframe for Lead Partner submitting claim to their
First Level Controller.
• Partners should be aware that final 15% ERDF
payment will be withheld pending completion and
acceptance of final progress report and payment
claim
First Level Control
• Project Partners should ensure First Level Controller has been approved.
• Any amendments to claim by First Level Controller should be clearly noted
on the claim form. It would be preferable if, in the event of an
amendment, individual amounts were not revised on the Verification
Sheets but a negative adjustment shown separately and referenced to the
actual amount declared. It should also be clearly noted in the text field by
the First Level Controller whether or not such adjustments have, in fact,
been applied.
• FLC Certificate accompanying claim must be signed by the approved First
Level Controller only.
• First Level Controller’s declaration in claim form must not be altered.
• FLC should comply with 2 month rule – Art 9.2 of Subsidy Contract.
Payment Flowchart
Joint Technical Secretariat
Payment Claim Flow
Money Flow
Certifying Authority
Assesses the Progress Report and
the Payment Claim received
Programme Bank Account
Prepares the payment request to the
Certifying Authority
Payment Claim
Project Lead Partner
Submits a Progress Report and a Payment Claim:
end April - full version and end October - light version
Reimburses the other project partners according to their
expenditure
Project Partner
Project Partner
The first payment claim
The following documents are necessary for payment of the first claim:
• a signed Subsidy Contract.
• a signed Partnership Agreement.
• first level controller approbation certificates for all partners submitting
expenditure and, in any case, the Lead Partner.
• a letter confirming the project’s bank details for payments, ideally with a
bank document showing the IBAN.
Expenditure Targets
Reporting
Deadline
Year
Annual Target
(total eligible
costs)
Cumulative Target
(total eligible costs)
31 October 2012
2011
€69,852.40
€69,852.40
30 April 2013
2012
€693,170.60
€763,023.00
30 April 2014
2013
€1,191,696.38
€1,954,719.37
30 April 2015
2014
€1,279,203.85
€3,233,923.22
30 April 2016
2015
€598,517.00
€3,832,440.22
Audit Trail
• Original Documents must be retained at partner level
• Copies of all documents (photocopies, microfiche or electronic) must be
retained by Lead Partner
• All documentation must retained and accessible for a period of three
years following the last payment to the Programme, i.e. 31st December
2021.
• Projects who cannot provide sufficient documentation risk losing their
ERDF grant.
Project Modifications
• 3 modifications are allowed over lifetime of project
• No changes permitted within last 6 months of the
project
• Can spend up to 120% of a budget line with
notification
• Can spend more than 120% of a budget line, with
approval
• Changes to the application form, partnerships and
end date also require approval
Common Errors
•
•
•
•
•
•
•
•
•
•
Mistakes in timesheets
Using incorrect budget line
Missing original documents or poor quality copies
Not project related
Breach of public procurement
FLC comments in checklist does not correspond to payment claim.
Double Financing
Claiming recoverable VAT and other recoverable charges
Publicity
Revenues/Receipts not declared
Useful Website Links
•
•
•
•
•
•
•
www.eustructuralfunds.ie
www.nweurope.eu
www.finance.gov.ie
www.bmwassembly.ie
www.seregassembly.ie
www.ec.europa.eu
Project Website to be agreed
Lead Partner Contacts
Project Manager
- Kieran Moylan ([email protected])
Project Coordinator
- Michael O’Brien ([email protected] )
Communications Manager - Barry Guckian ([email protected])
Finance Manager
- Catherine Burke ([email protected])
Telephone:
Fax:
- (00353) 94 9862970
- (00353) 94 9863973