Characteristics of projects in EU research programmesCharacteristics of projects in EU research programmes

Kai TulliusKai Tullius

DG Information Society and MediaDG Information Society and Media

Unit E2Unit E2

Kai TulliusKai Tullius

DG Information Society and MediaDG Information Society and Media

Unit E2Unit E2

Outline of PresentationOutline of Presentation

• Project Selection Process Project Selection Process

• Contract overviewContract overview

• Overview of reporting & financingOverview of reporting & financing

• Reporting

• Review

• Costs / Receipts

• Payment

• Audit certificates

• Amendments

• Collective Responsibility

• ConclusionsConclusions

Contract OverviewContract Overview

Contract – between whom?Contract – between whom?

• Between EC and co-ordinator (Between EC and co-ordinator (the legal the legal

representative of the consortiumrepresentative of the consortium))

• All contractors must accede within time limit All contractors must accede within time limit

specified in contract (30 days) from the date of the specified in contract (30 days) from the date of the

signature signature

Contract OverviewContract Overview

Consortium agreement in place, EC Consortium agreement in place, EC contract takes precedence in case of contract takes precedence in case of conflictsconflicts

Should cover issues:Should cover issues:

• Decision-making process and dispute settlingDecision-making process and dispute settling

• IPRIPR

• Payment modalities between partnersPayment modalities between partners

• Global Risk ManagementGlobal Risk Management

0 6 12 18 24 30 36 Months

Reporting

Accepted costs

Reporting Detailed work plan

Accepted costs Adjusted pre-financing

Reporting

Accepted costs Detailed work plan

Adjusted pre-financing

Detailed work plan

Initial pre-financing

Contract OverviewContract Overview

Payment & Reporting Schedule (IP)

ReportingReporting

• 45 days after end of each reporting period 45 days after end of each reporting period

• Annual Activity ReportAnnual Activity Report

• Annual Management ReportAnnual Management Report

• Report on the distribution between contractors of the Community Report on the distribution between contractors of the Community financial contributionfinancial contribution

• Any additional report defined in AnnexesAny additional report defined in Annexes

• Updated Implementation Plan (IP only)Updated Implementation Plan (IP only)

• Financial Statements (Form C) and Audit Certificates (if Financial Statements (Form C) and Audit Certificates (if applicable) applicable)

• Final period:Final period:

• all + all +

• Final Activity Report Final Activity Report covering the full durationcovering the full duration

• Final management report Final management report covering the full durationcovering the full duration. .

• Any additional report defined in annexes.Any additional report defined in annexes.

• Report on the final financial distribution (60 days after receiving it)Report on the final financial distribution (60 days after receiving it)

Annual ReviewAnnual Review

• Review is a contractual requirement to be carried Review is a contractual requirement to be carried out after each reporting period - successful outcome out after each reporting period - successful outcome required for paymentrequired for payment

• Review is based on: Review is based on:

• Reports and Deliverables (technical objectives timely Reports and Deliverables (technical objectives timely achieved with adequate quality?)achieved with adequate quality?)

• Resources deployed appropriate?Resources deployed appropriate?

• Annual Management ReportAnnual Management Report

• proposal for update to Implementation Plan (IP)proposal for update to Implementation Plan (IP)

Costs / ReceiptsCosts / Receipts

• Cost basis FC/FCF/ACCost basis FC/FCF/AC

• AC participants cannot charge costs of permanent staff AC participants cannot charge costs of permanent staff

(except for management)(except for management)

• Direct/indirect CostsDirect/indirect Costs

• Eligible/ineligibleEligible/ineligible

• eligible = eligible = economiceconomic and necessary and necessary

• No reckless expenditureNo reckless expenditure

• no sub-contracting unless specified in Technical Annex, no sub-contracting unless specified in Technical Annex, except for minor tasks (services, brochures, audit except for minor tasks (services, brochures, audit certificates)certificates)

• ineligible costs include bank interest, losses etc.ineligible costs include bank interest, losses etc.

• in general, follow your internal rules and practicesin general, follow your internal rules and practices

• must be auditable -> document carefullymust be auditable -> document carefully

• Receipts have to be declared Receipts have to be declared

PaymentPayment

• Pre-financing max. 80% of estimated cost of first Pre-financing max. 80% of estimated cost of first 18 months18 months

• Next payment within 45 days of approval of Next payment within 45 days of approval of annual activity reports annual activity reports

• Payment for a period normally combined with pre-Payment for a period normally combined with pre-financing for next period financing for next period

• Usual provisions concerning suspension of Usual provisions concerning suspension of payment terms due to missing/incomplete payment terms due to missing/incomplete information etc.information etc.

• Receipts reduce grant and must be declared in Receipts reduce grant and must be declared in cost claims. cost claims.

Audit CertificatesAudit Certificates

• Audit certificates (depending on contract)Audit certificates (depending on contract)

• Free to chose auditor (no need for tendering…)Free to chose auditor (no need for tendering…)

• Independent, external auditor, qualified to national Independent, external auditor, qualified to national regulations – exception: “Competent public officer” for regulations – exception: “Competent public officer” for public bodiespublic bodies

• Certify that costs incurred during period meet the Certify that costs incurred during period meet the conditions required by the contract, should expressly conditions required by the contract, should expressly state amounts verifiedstate amounts verified

• make early contract with your external auditormake early contract with your external auditor

• establish with him how to submit cost claims/certificates 45 establish with him how to submit cost claims/certificates 45 days after end of period - continuous assessment process?days after end of period - continuous assessment process?

• Payments supported by audit certificates are finalPayments supported by audit certificates are final

• except in case of fraud, over-charging etc.except in case of fraud, over-charging etc.

• Cost of audit certificates is an eligible cost (if economic!)Cost of audit certificates is an eligible cost (if economic!)

AmendmentsAmendmentsAmendmentsAmendments

• Amendments: no tacit approvalAmendments: no tacit approval

• To be submitted by registered mail by an To be submitted by registered mail by an AUTHORISED signatory of the COORDINATOR with AUTHORISED signatory of the COORDINATOR with all supporting documentsall supporting documents

• Request must adhere strictly to template Request must adhere strictly to template (amendment guidelines on Cordis)(amendment guidelines on Cordis)

• May include 1 or many modificationsMay include 1 or many modifications

• Binary processing: everything acceptable or Binary processing: everything acceptable or everything rejectedeverything rejected

Collective Responsibility

1.1. Technical Collective ResponsibilityTechnical Collective Responsibility

• Each contractor obliged to take all necessary measures to attain the objectives of the project and to carry out the work incumbent on the defaulting contractor

2.2. Financial Collective ResponsibilityFinancial Collective Responsibility

• Should either the contract or participation of a contractor be terminated and any contractor does not honour the reimbursement of the amount due by that contractor, the Consortium is responsible to reimburse that amount to the Commission

• Amount to be recovered to be allocated between the remaining contractors in accordance with their pro rata share in the project

ConclusionConclusion

• FP6 very different to FP5!FP6 very different to FP5!

• Increased responsibility for consortiumIncreased responsibility for consortium

• all aspects - management, budget, technical work…...all aspects - management, budget, technical work…...

• Expenditure/accounting according to your own, normal Expenditure/accounting according to your own, normal rules and practicesrules and practices

• no more permission requests - but you may have to justify no more permission requests - but you may have to justify your actions/expenditure later!your actions/expenditure later!

• Bigger projects, greater opportunity, greater riskBigger projects, greater opportunity, greater risk

• Greater visibility and higher expectations Greater visibility and higher expectations

• Expect more scrutiny from tax-payer and politiciansExpect more scrutiny from tax-payer and politicians

• More than ever, need strong management in all areas, More than ever, need strong management in all areas, clear focus, effective implementation!clear focus, effective implementation!

• you must deliver!!you must deliver!!

ConclusionConclusion

• New financial regulations require strict compliance New financial regulations require strict compliance with contract and deadlines with contract and deadlines

• EC must also demonstrate that it has implemented EC must also demonstrate that it has implemented contracts correctly contracts correctly andand ensure proper use of public ensure proper use of public moneymoney

• especially important for annual activity reports, especially important for annual activity reports, cost claims, cost claims, audit certificatesaudit certificates

• avoid delays with review and approval of programme avoid delays with review and approval of programme of work/amendment for following periodof work/amendment for following period