2. Financing and Reporting
Dave Catherall
Head of External Funding
Partner 1 Oldham
Churchgate House, Oxford Road, manchester

3. Agenda: Eligibility period Basic principles reporting expenditure
Budget lines
Reporting periods
Other eligibility rules
First level Control
Decommittment Rule (N+3)
Budget reallocation
Questions

4. 1) Eligibility period:
Costs are eligible from 1 January 2017 to June 2021
ALL costs must to be paid within this period in order to be eligible
Start preparing and auditing the final report in time to meet the date of submitting to the lead partner ( including FLC)

5. Reporting and changes Reporting Procedures in programme manual
Phase 1 (till 31 dec 2018), every six months
Phase 2 ( ) once a year
Including Fist Level control for expenditure
Archiving of documents: period will be communicated by MA after the closure of the project
Changes
Budget reallocation beyond 20% flexibility
Possible changes over flexibility, once during the project lifetime

6. 2) Basic principles reporting expenditure:
Expenditure can only be reported if the following principles are fulfilled:
The calculation is based on actual costs (except administration costs = flat rate and preparation cost = lump sum)
The costs are definitively borne by the partner body and would not have arisen without the project
The expenditure had actually been paid out. Expenditure is considered to be paid when the amount is debt from the partner institution’s bank account
The expenditure is directly linked to the project. Costs related to activities that are not described in the application form are not eligible

7. 3) Budget lines: Staff costs Administration costs
Travel and Accommodation
External expertise and services
Equipment  not in project budget

8. Staff costs:
Personnel must be directly employed by the partner organisation
Personnel external to the official organisation must be reported under the budget line External Expertise
Gross employment costs: salary payments, employment taxes, social security (including health coverage and pension contributions)
No overhead costs
Calculation must be based on the actual salary rate of the individual employee
Supporting documents: working contract, payslip, payment of proof, time sheets, etc.

9. Staff Costs - calculations
4 options:
1) Working full time on the project:
- 100% of monthly salary costs
2) Working partly on the project:
- X% of monthly salary costs
3) Working partly on the project at a flexible percentage: - Contractual hours hours
4) Employed on a hourly basis (fixed hourly rate)

10. Staff Costs Option 1) working full time on the project:
Supporting documents:
Employment contract;
Working contract proving 100% working for the project;
Payslips;
Proof of payment;
No time sheets needed

11. Staff Costs Option 2) working partly on the project:
Supporting documents:
Employment contract
Working contract proving X% working for the project
Payslips
Proof of payment
No time sheets needed

12. Staff Costs
Option 3a) working partly on the project at a flexible percentage (contractual hours): Supporting documents:
Employment contract
Document proving monthly / weekly working time
Payslips
Proof of payment
Document showing calculation hourly rate
Timesheets of 100% monthly working time

13. Staff Costs
Option 3b) working partly on the project at a flexible percentage (1.720 hours): Supporting documents:
Employment contract
Payslips
Proof of payment
Document showing calculation hourly rate
Time sheets of 100% monthly working time

14. Staff Costs Option 4) Employed on a hourly basis:
Employment contract (including hourly rate)
Payslips
Proof of payment
Time sheets of 100% monthly working time

15. Admin Costs Administration costs (15% of total staff costs):
- Flat rate of 15% of total staff costs
- Includes office rent, electricity, office supplies, archives etc.
- No supporting documents

16. Travel & Accomodation
This cost category is only reserved for T&A costs of personnel employed by the partner organisations officially listed in the Application Form
Travel
Meals
Accommodation
Visa requirements
Daily allowances – if payable

17. T & A continued
T&A costs of external expert have to be reported under the budget line “External expertise and services”;
The trips are justified by the project’s activities foreseen in the AF;
Daily allowance is possible as long as it is actually paid by the partner body to the employee and this is in line with national and institutional conditions;
It is not allowed to claim daily allowance and paid subsistence costs as well; Supporting documents: agenda of meeting, paid invoices, bank statements, travel tickets, boarding passes, daily allowance claims, CO2 compensation (included in ticket price) etc.

18. External Expertise
Limited list of services and expertise (see programme manual)
Expenses paid by the partners to external service providers on the basis of:
* contracts/agreement
* invoices/request for reimbursement
Whenever a partner purchases services, goods, equipment, etc. externally procurements rules must be adhered, including European public procurement rules and the relevant national and internal rules of the partner responsible for subcontracting
Supporting documents: * selection process; * contract; * invoice and proof of payment; * output of the work or service deliverables
Travel and accommodation costs for stakeholders
Project partners can not contract one another;

19. Reporting periods
Phase 1 (1/1/2017 – 21/12/2019): period 1/1 – 30/6: 15 August (JS = 1 October)
period 1/7 – 31/12: 15 February (JS = 1 April)
Phase 2 (1/1/2020 – 31/12/2021): annual
Year 2020:15 February 2021 (JS = 1 April 2021) Year 2021 final report):30 September 2021 (JS = 31 December 2021)

20. Other Rules Not eligible: VAT: only eligible if not recoverable;
Fines, financial penalty’s, interest on debt;
Contributions in kind;
Expenditure already 100% cofinanced by EU funding;
Gifts: only when related to promotion / communication activities (< € 50)  prior approval of JS in any case
Net revenues: must be deducted from costs;
Public procurement:
EU rules (unlikely in this project);
National rules apply;
Internal rules partner organisation

21. First Level Control
Each progress report should be verified and confirmed by an independent controller compliant with the FLC control system of the Member State.
Designation of FLC:
Controller who is authorised by Member State  see programme website;
Controller is independent and qualified for control of expenditure;
Internal controller: separated unit from project activities and finances;
External controller: no contractual relations with the project or partner that could lead to a confict of matters;

22. First Level Control
Four models: * centralised: public administrative body or private firm * decentralised: central short list or internal or external selected by partner and approved on national level;
Decentralised: each partner has to provide an “approbation certificate” delivered by the approbation body designated by the Partner State  delivered with the first progress report;
Standard documents for FLC: * independent first level control certificate (availabale at website JS); * control template with control checklist (available at website JS);
FLC has to check 100% of reported costs or by random sample method;
On the spot check at least once during project lifetime

23. Decommittment n+3
The ERDF amounts have to be spent within 3 years of the year when is committed within the Interreg Europe programme (n+3);
Any of the allocations which at the end of 3 years are not covered by project expenditure will be lost decommitted);
If the loss results form certain partners lagging behind their spending targets, the LP will be obliged to reduce the budget of these partners.

24. Budget Changes
Changes in budget lines and partner budgets are allowed as long as the maximum amount of ERDF awarded remains the same (= flexibility rules);
All minor changes can be reported as deviations in the progress reports, including justification;
Major changes are obliged to request for approval by JS: * change of partnership; * change of core activities; * change of budget > 20% for budget line or partner; * change of project duration
Only once during project lifetime a budget change > 20%
Important: the spending plan can not be modified because of decommitment rules

25. Exchange Rates
Partners located outside the EURO-zone will have to convert their expenditure in euro’s. The exchange rate of the Commission applicable in the month the documents are submitted for verification to the first level controller.
The month exchange rate of the Commission are published on:

26. Technical reporting

27. Reporting activities Why?
To follow the project’s progress not only in terms of activities / outputs but also in terms of results
To demonstrate the project’s / programme’s success and usefulness
How is it carried out?
Mainly through the progress reports
Through project’s website, publications and good practices
Maybe through the JS participation in project event(s)

28. Reporting activities Basic principles
Same template for phase 1 and phase 2: only certain sections are adapted according to the phase
Two parts in the achievements reporting:
Part 1: Insight into project’s implementation
Part 2: Insight into project’s results (from the first period!)
Part 1: Implementation
Overview of day-to-day project implementation
Consolidated information
2 sections: overview and work plan

29. Implementation

30. Implementation 1.1. Overview
Exchange of experience process (Phase 1) / Monitoring of action plan (Phase 2)
Involvement of partners
Policy learning process / difficulties
Stakeholders involvement in this process / all regions?
Participation in PLP
1.2 Storytelling
What are you particularly proud of in this reporting period?

31. Activities Ouputs’ points of attention
N° of policy learning events organised
Back-to-back events
Include stakeholder group meetings
N° of people with increased capacity
Include active members of the stakeholder groups
To be reported in the last semester of phase 1 only
N° of action plans developed

32. Activities Activities reporting per semester
Progress made in comparison with initial plans

33. Good practices

34. Results Insight into project’s results Organised per policy instrument
Distinction between
‘policy change’: direct result of exchange of experience
‘territorial impact’: longer term results

35. Part 2: Results Results: points of attention
Indicators: automatically calculated based on the information provided under each policy instrument
To be completed only if the policy change has already occurred (intention does not count)
Financial impact: funds directly influenced by the change

36. Part 2: Case study
The geographical coverage of the policy instrument refers to the NUTS level covered by the policy instrument itself
ROP Andalusia – NUTS 2
Municipal Mobility Plan – NUTS 3
A policy change can be reported only when the policyinstrument has been successfully influenced
implementation of new projects
change in the management of the policy instrument
change in the strategic focus

37. Part 2: Case study The policy change has to be very well described:
What is the change (e.g. new call launched, new measure introduced in the OP, new monitoring system)
Source of the lessons learnt (Interregional workshops, Study visits, Staff Exchange, etc.)
Indicator ‘estimated amount of funding influenced’
Tangible, already defined and directly related to the change
The territorial impact and the self-defined indicators can evolve during the project lifetime

38. Final recommendations
To ensure that the report is self-explanatory
To ensure that the report is understandable
even when the theme tackled is quite specialised, non specialists should be able to understand
role of the LP to ‘digest’ and summarise information coming from the whole partnership
To ensure consistency between output indicators, activities and project website
To ensure a clear link between activities and finance reporting
E.g. description of the external expertise to be in line with activities

39. Final recommendations
To be as precise as possible e.g. activities to be described in details (dates, location, content, participants)
To provide ‘qualitative’ information. Monitoring of outputs important but not sufficient.

40. Thank you!
Questions welcome