1. LIFE Platform meeting Denmark 2008 Tommy Sejersen, Financial Desks EC DG ENV – LIFE Unit Telephone +32.2.295.15.35 E-mail: tommy.sejersen@ec.europa.eu

2. Legal Framework: Grant Agreement Common Provisions (CP) Application guide Financial Forms

3. Grant Agreement: Maximum grant amount Funding rate Project period Common Provisions (integrated in GA) Approved proposal (Annexed to GA)  Project participants  Budget of the project

4. Common Provisions Project Actors: Beneficiary (Art 4) Partner (s) (Art 5) Co-financer (s) (Art 7) Subcontractor (s) (Art 6)  Art 6.4 : Public tenders obligatory for public beneficiary/partner Competitive tenders for private beneficiary/partners  Art 6.5: Clear reference to the LIFE-project shall be included in the invoices/order form (also in Art 4.8 & 5.6) Amendment to the agreement (Art 13) Art 13.2 8th bullet point : 10% and 10.000 € rule

5. CP define: Eligible costs (Art 21.1 -21.12)  Provided for in the provisional budget/ Directly necessary for the project  Incurred during the lifetime of the project: - Legal obligation to pay (the cost) has been contracted after the project start and before the end date - Execution of corresponding action starts after the project start and is completed before the end date - Full payment before submission of final reports - Incurred by the project participants Exception: Costs for independent audit Art 27 can be executed after project end date – but must be terminated, invoiced and fully paid before submission of final report, and auditor is given the assignment before the project ends

6. CP define: Ineligible costs (Art 22) Some examples:  Exchange rate losses  Debtors interest/interest on borrowed capital  Services in kind (e.g. voluntary work)  Licence or patent fees related to the protection of intellectual property right

7. CP define: Payments (Art 23)  The First pre-financing payment (40%)  The Second pre-financing payment (30%)  at least 150% of the first pre-financing used New from 2005 (other conditions for the projects of 2004 and earlier)  The Balance  final payment

8. Application guide Section “How to fill in the financial application forms” Example: Personnel costs and calculation of annual number of working days, Information requested in the financial reporting

9. FINANCIAL FORMS Where to find the model of financial forms: http://ec.europa.eu/environment/life/toolbox/fi nancial_sheet.htm Excel based model offering conversion facility New on-line financial reporting tool - FIRE

10. Statement of expenditure and income To be delivered:  Project consolidated statement of expenditure, completed and signed by beneficiary  Participant statement of expenditure, completed and signed by each participant  In balance  Project income (profits generated by the project – Art 20.4)  No profit for beneficiary/partner (Art 20.3)  Interest accrued on the pre-financing amount (Art 20.6)

14. FIRE

15. Financial check list General principles: Analytical accounting system (“cost centre”). Identifiable and exclusive person to approve costs. Costs incurred by non-participants (Company groups) –Legal entities Mention of the project on the invoice received

16. Financial check list Personnel costs (Art 21.2): Time registration (time sheets). Model - monthly time-sheet http://ec.europa.eu/environment/life/toolbox/times heet.htm Signature and approval of time sheets. Annual number of working days. Actual annual gross salary. Public staff

17. Calculation of personnel costs

18. Financial check list Travel and subsistence (Art 21.3): Internal rules for re-imbursement of travel expenses Prior approval by Commission for ex-EU travels Detailed specification of travel expenses, two lines if necessary. Group low value travel expenses (supported by accounting documents)

19. Financial check list External Assistance Art 21.4): 1.Tender requirement of Art 6.4. 2.Mention the project in the invoice (Art 4.8, 5.6 & 6.5) 3.Subcontractors not project participants.

20. Financial Check list Durable goods (Art 21.5 – 21.8): Purchased in the project period (Art 21.8) Actual depreciation (internal accounting standard) up to 25%/50% ceiling (Art 21.6) Inventory Clearly identifiable Nature projects 100% eligible – approved 25%/50% - not approved, but technically justified Prototype not used for commercial activities (Art 21.7)

21. Financial check list Overheads (Art 21.12): 2005 projects 7% flat rate maximum Earlier projects overhead costs should be explained.

22. Financial check list Partnership agreements (Art 4.7): Is there signed a partnership agreement Clear rules for collecting partner’s costs

23. GENERAL HINTS FOR FINANCIAL REPORTING

24.  Study carefully the Common Provisions (CP) and « re-read » them whenever a problem of administrative-financial nature occurs  Distribute the CP to all project partners and make sure that CP are applied by them  Oblige your partners to forward their project accounting data to you regularly.  Respect the classification of the budget

25.  Keep the project accounting up-to-date, including regular update of the financial forms  Introduce all data requested, i.e. complete all “cells” of the financial forms, or explain why they remain “empty”  Describe with sufficient detail the types of purchased services/goods and their link with the work programme or action  Keep all appropriate supporting documentation for all expenditure and income – including copies of the partners’ supporting documentation Supporting documentation - Examples: e.g. purchase orders, invoices, payment proofs, public tendering documents for personnel: monthly salary slips, presence/time sheets, calculation of social charges if not included in salary Commission staff have made a confidentiality promise

26.  VAT: For VAT charges to be considered eligible the beneficiary must provide a declaration from the relevant national authorities that it and/or its partners must pay and may not recover the VAT for the assets and services required for the project.  Currency of the reports: only the Euro (€), Art. 25.4 Payments made in different currencies: use the exchange rate applied by the European Central Bank on the first day of the month in which the financial report is presented to the Commission Where to find: http://ec.europa.eu/budget/inforeuro/index.cfm

27. INDEPENDENT AUDIT New from 2005  Maximum amount of grant ≥ € 500.000  pre-financing (s) > € 750.000  Final payment request > € 150.000

28. External/Independent Auditor’s Report Find a model of the standard audit report at: http://ec.europa.eu/environment/life/toolbox/standardaudit.htm

29. Thank you for your attention !