1. Communication campaign
Most common issues identified:
Personnel costs & Other direct costs
Antonio Requena Fernández
FCH JU Financial Officer

2. Hours dedicated to the project
Personnel costs
Personnel costs
Hours dedicated to the project
Hourly rate = X

3. = Hourly rate Total annual costs Total annual costs Total annual costs
Salary
Social security
Pension contribution
Total annual costs
Health insurance
Total annual costs
Other statutary costs…
Total annual costs
Total annual costs
Hourly rate of an employee
Total annual costs =
Annual productive hours

4. Hourly rate: Productive hoursvs
Standard (ALL employees)
Total days in a year
365
Weekends
-104
Subtotal
261
Annual holidays
-21
Statutory holidays
-15
Illness & others
Productive days per year
210
Working hours per day 8
Productive hours per year
1 680
Actual (individual)
You compute the actual individual number of productive hours for each employee
The time recording system must allow keeping track of this number of actual individual productive hours
If actual productive hours exceeds standard use actual!!!
Don’t use billable hours!!!

5. Overtime may be accepted
If actually paid according to beneficiary’s policy AND
If there is a system that allows the identification of normal / overtime hours worked for the project
The hourly rate applicable to these «overtime» hours has to be calculated separately from the hourly rate applicable to the normal working hours
The hourly rate is calculated:
Adding in the numerator: normal costs + «overtime» costs (if any)
Adding in the denominator: normal hours + «overtime» hours
In any other case: either overtime not paid or there is not clear distinction between normal and overtime hours

6. Hourly rate: Productive hours
Activities included
Normal working activities of the personnel, including:
Sales and Marketing
Preparation of proposals
Administrative time
Non-project related, general research activities
Teaching, training and similar hours (in the case of universities/similar bodies)
Activities excluded
General training (if not project related)
General internal meetings (if not project related)

7. Hours dedicated to the project
The golden rule: Claim ONLY actual hours worked on the project
Timesheets
Alternative evidence
Whole duration of the project
Must give the same level of assurance as the timesheets
Full name of beneficiary
Name and signature of employee
To be assessed by the auditors
Title of the project
Daily, weekly or monthly basis
Amount of hours claimed for the project
Name and signature of a supervisor
Reconcilable with the absences register

8. Example of timesheet
Reference to the WP
Brief description of tasks

9. Actual personnel costs. Some errors
Annual costs
Hours
Personnel costs =
Hours X
Productive hours +
Timesheets not reliable
Claim of more hours than dedicated to the project
Claim of more hours than substantiated by timesheets

10. Actual personnel costs. Some errors
Annual costs
Personnel costs =
Hours X
Personnel costs
Hours
Productive hours -
Timesheets not reliable
Claim of less hours than dedicated to the project
Claim of less hours than substantiated by timesheets

11. Actual personnel costs. Some errors
Annual costs
Personnel costs =
Hours X
Productive hours
Productive hours -
Use of standard hours instead of actual when the latter are higher
Use of billable hours instead of productive hours

12. Average personnel costs
Acceptability criteria for average personnel costs
Based on the usual cost accounting practice of the beneficiary and consistently applied to their participations in the Framework Programme
Based on the actual personnel costs of the beneficiary as registered in its statutory accounts, without estimated or budgeted elements
They exclude any ineligible cost item and any cost claimed under other costs categories in order to avoid double funding
Number of productive hours shall correspond to usual management practice of the beneficiary and reflects its actual working standards

13. = SME owners X Hourly rate 1 575 100
SME owners and other natural person who do not receive a salary
Annual living allowance corresponding to the appropriate research category published in the ‘People’ Work Programme of the year of the publication of the call to which the proposal has been submitted
Country correction factor published in the same document
Hourly rate = X
1 575
100

14. Use the tool available at CORDIS
SME owners
Example: SME owner without salary from Austria with 5 years of experience at the time of deadline of submission of a proposal 2011
Use the tool available at CORDIS
€/year
106.9
39.71 €/h = X
1 575
100

15. Other direct costs
The golden rule: Costs attributed directly to the project which can be identified as such according to the accounting principls of the beneficiary
Travel costs
Only for staff taking part in the project
In case of conferences/seminars: copy of the presentations to show direct link to the project
Expenses related to daily commute to work are not considered travel costs.
Consumables and supplies
If they are necessary for the implementation of the project
Subject to the accounting principles of the beneficiary, the following consumables/supplies can be considered either direct or indirect costs:
Water, heating, electricity, maintenance, insurance
Communication expenses, postal charges, office supplies
Costs related to general administration and management
Miscellaneous recurring consumables

16. Other direct costs
The golden rule: Costs attributed directly to the project which can be identified as such according to the accounting principls of the beneficiary
Minor tasks
Minor services not identifed in Annex I but needed for the implementation of the project
Examples:
Organisation of the rooms and catering for a meeting (logistic support)
Printing of material, leaflets, etc.
Services related to setting up and maintenance of a project website
To be reported under type of activity “Management”, category of costs “Subcontracting”

17. Other direct costs
The golden rule: Costs attributed directly to the project which can be identified as such according to the accounting principls of the beneficiary
Equipment
If necessary for the implementation of the project
Costs to be determined according to the beneficiary’s usual accounting practice
Possibility of charge 100% equipment acquisition price in 1 reporting period if national legislation allows it
Otherwise, depreciation to be charged in each relevant periodic report
Consider percentage of use in the project
Depreciation costs for equipment bought before the start of the project
Yes, if the equipment has not yet been fully depreciated , then the remaining depreciation can be eligible under the project
Subject to the accounting principles of the beneficiary, computers and office software can be considered either direct or indirect costs