FP 6 Financial Management and Reporting 1

FP 6 – Financial Management and Reporting 1 April 2006 Sofia, Bulgaria 1

FP 6 - Budgeting The Community financial contribution – a grant to the budget or grant for integration (Networks of Excellence), no profit can be generated, reimbursement of eligible costs Principals: n the principle of non-profit n the principle of co-financing 2

FP 6 - Budgeting Proposal preparation: n Cost models – FC, FCF, AC Full Cost with actual indirect costs (FC) all eligible direct and indirect costs are charged by the contractors. Full Cost with indirect flat rate costs (FCF) all eligible direct costs and a flat rate for indirect costs are charged. The flat rate is 20% of all direct eligible costs minus the cost of sub-contracts. Additional Costs with indirect flat rate costs (AC) all eligible direct additional costs and a flat rate for indirect costs are charged. The flat rate is 20% of all direct additional costs minus the cost of sub-contracts. 3

FP 6 - Budgeting Proposal preparation: n Budget items: Personnel – ~ 50% of the overall budget, 210 working days per year (17. 5 working days per month, 8 hours per day) Travel and subsistence – 10 -12%, travel abroad and domestic travel Equipment – 3 years of depreciation Other specific project costs – seminars, web-sites, brochures, publication of reports Overhead – depending on the cost model Subcontracting – up to 20% Management costs (+auditing) – 7% of the Community contribution, if FCF or AC applied in the case of CA or SSA no overhead, if FC applied – 20% on the direct costs n Financial management section in the proposal – description of the budget items per partner, the explanation of the subcontracting category is a must 4

FP 6 – Project implementation n n Consortium agreement to complement the contract with the Commission – specifies the internal reporting deadlines, quality assurance criteria, means of communications, rights and obligations of the partners, remedy mechanisms in the case of nonperforming partners Advance payment by the Commission – within 45 days after the accession to the contract by all partners Reporting – 45 days after the end of the corresponding period Interim payments – within 45 days after the approval of the corresponding periodic report and the financial statements 5

FP 6 – Project implementation n Transfers between the budget items Transfers between the partners – above 20% - annex to the contract Subcontractors – 3 offers, work to be subcontracted must be described in the Technical Annex 6

FP 6 – Project reporting Audit certtificate The audit certificate is a document provided by an external auditor (or in the case of a public body it may be provided by a competent public officer) certifying that the costs claimed during a specific period meet the contractual requirements established by the FP 6 model contract. The audit certificate is a project deliverable which is presented by the contractor through the co-ordinator to the Commission together with a Financial Statement (Form C) at the end of reporting periods as determined by the contract. 7

FP 6 – Project reporting Audit certificates n n If an audit certificate is submitted, a payment is made to settle the amounts justified and accepted during the reporting period; and an intermediate pre-financing of the estimated Community financial contribution corresponding to the subsequent period and the first six months of the period following, indicated in the table of estimated breakdown of costs for this period in Annex I. If an audit certificate has not been submitted there is an intermediate pre-financing of the estimated Community financial contribution corresponding to the subsequent period and the first six months of the period following, indicated in the table of estimated breakdown of costs for this period in Annex I. 8

FP 6 – Project reporting Auditing If the AC/FCF cost reporting model is used, indirect costs do not need to be examined as a flat rate is applied. If the FC cost reporting model is used the indirect costs will need to be certified. . 9

FP 6 – Project reporting Reporting n The coordinator, on behalf of the consortium must submit to the Commission, by electronic means and by mail, within 45 calendar days following the end of each reporting period (mentioned in Article 6 of the core-contract) the following periodic reports a periodic activity report containing an overview of the activities carried out by the consortium during that period, a description of progress toward the objectives of the project, a description of progress towards the milestones and deliverables foreseen, the identification of any problems encountered and corrective action taken. An updated plan for using and disseminating the knowledge shall be included as a separate part of this report 10

FP 6 – Project reporting n a periodic management report on that period including: Ø Ø a justification of the resources deployed by each contractor, linking them to activities implemented and justifying their necessity; Form C (Financial statement per activity) (the model format is set out in Annex VI to the contract) provided by each contractor for that period: a report on the distribution made between contractors of the Community financial contribution during that period any supplementary reports required by any Annex to the contract, especially Annex I (technical annex) and Annex III (specific provisions). 11

FP 6 – Project reporting FINAL REPORTS n a final activity report covering all the work, objectives, results and conclusions, and the final plan for using and disseminating the knowledge, including a summary of all these aspects; n a final management report covering the full duration of the project including a summary financial report consolidating the claimed costs of all the contractors in an aggregate form covering the entire duration of the project, based on the information provided in Form C by each contractor; n any supplementary reports required by any Annex to this contract, especially Annex I (technical annex) and Annex III (specific provisions) 12

FP 6 – Project reporting FINAL REPORTS n The coordinator, on behalf of the consortium must submit to the Commission, by electronic means and by mail, within 60 calendar days following the date of reception of the last payment of the Commission a report on the distribution of the Community financial contribution between contractors made after the end of the project 13

Thank you for your kind attention! Zoya Damianova ARC Fund Zoya. Damianova@online. bg Tel. +359 -2 -986 -7557 14