October 25, 2005October 25, 2005

Pathways To Successful Pathways To Successful

EU-Research ProjectsEU-Research Projects

Financial management in FP 6 projectsFinancial management in FP 6 projects

Praha, October 25, 2005Praha, October 25, 2005

Claudia LabischClaudia LabischKoWi Office KoWi Office BrusselsBrussels

cl@kowi.decl@kowi.dephone: 0032-2-548.02.12phone: 0032-2-548.02.12

www.kowi.dewww.kowi.de

October 25, 2005October 25, 2005

Problems encountered in EU-research projects:

Which cost model do I have to go for?

Definition of "personnel"

Eligibility of personnel costs

Limited use of subcontracts

Audit certificates

Communication

October 25, 2005October 25, 2005

Which cost model do I have to go for?

• Make sure you choose the right cost model as of proposal submission

• Change of cost model during lifetime of Framework Programme

• Change of cost model during project's lifetime

• No change of initially allocated budget!

October 25, 2005October 25, 2005

Definition of "personnel" within a EU-project

• Employees having permanent working contracts with

the contractor

• Employees having temporary working contracts with the

contractor

• Personnel made available by a third party on basis of

prior agreement (contribution of third parties)

October 25, 2005October 25, 2005

Eligibility of personnel costs

• Contractors using the FC- or FCF-model may charge any

personnel costs to the project (according to above

definition of "personnel").

• Contractors using the AC-model may only charge costs of

permanent staff involved in the project for management of

consortium activities! (or other, if additional costs)

October 25, 2005October 25, 2005

Limited use of subcontracts

• Core elements of the project can not be subcontracted

(project management!)

• Only for tasks which cannot be carried out by the contractors

• If there is a subcontract, it must always become part of the

contract with the European Commission (contract amendment)

October 25, 2005October 25, 2005

Audit certificates – who can deliver the audit certificate?

Each contractor is free to choose any qualified external auditor,including its usual external auditor, provided that it meets the cumulative following professional requirements:• external auditor must be independent from the contractor;• external auditor must be qualified to carry out statutory audits of

accounting documents in accordance with the 8th Council directive 84/253/EEC of 10 April 1984 or similar national regulations. 

A contractor that is a public body may opt for a competent publicofficer to provide an audit certificate, provided that the relevantnational authorities have established the legal capacity of thatcompetent public officer to audit that public body.(Rules for auditing and auditors: Articles II.26 and II.29, Annex II to the Model Contract)

October 25, 2005October 25, 2005

Audit certificates /II

• In case of internal audit (for public bodies), the service concerned may claim only real costs of effecting the audit (no subcontracting).

• Claim of overheads on audit costs for contractors in AC-model only if costs of audit are additional direct costs;

• Charge of audit costs in the relevant reporting period;

October 25, 2005October 25, 2005

Audit certificates / III

• There is no standard format for an audit certificate;

• External auditor or public officer should follow model proposed by the Commission (see Annex 7 of Financial Guide)

• Audit certificate should be issued in one of the official languages of the EU; should be the same language used for all other reports; otherwise, external auditor must attach translation in that language.

October 25, 2005October 25, 2005

Communication ...

... on different levels in order to avoid problems and misunderstanding:

• Internal communication (financial department, legal service)

• External communication = at consortium level, to clarify important matters (cost model, allocated budget, reimbursement of audit costs, clause 39 ...)

October 25, 2005October 25, 2005

Information on Financial Management ofEU-Projects within FP6:

http://www.cordis.lu/fp6/project-management.htm

http://www.cordis.lu/fp6/find-doc.htm#reporting

http://www.kowi.de/en/fp/projects/default.htm