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Eligibility of costs

Seminar for Beneficiaries 13-14 August Rēzekne, Latvia. Eligibility of costs. Joint Technical Secretariat. Eligible periods. Only costs made during the project implementation period a re eligible. 2. Eligible periods.

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Eligibility of costs

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  1. Seminar for Beneficiaries 13-14 August Rēzekne, Latvia Eligibility of costs Joint Technical Secretariat

  2. Eligible periods Only costs made during the projectimplementationperiodare eligible 2

  3. Eligible periods • The only exception are costs relating to final reports, expenditure verification and evaluation of the project, which can be incurred not later than the date of submission of the final report • Preparatory costs (expenditures before project starting date) are ineligible 3

  4. Main eligibility rules In order to be eligible, costs have to be: • Shownin the approvedFullApplicationForm • Comply with the visibility requirements • Necessary for the implementation of the project 4

  5. Main eligibility rules • Identifiable and verifiable, in particular being recorded in the accounting records • Incurred in compliance with the relevant procurement procedures • Reasonable, justified and comply with the requirements of sound financial management 5

  6. Main budgetary principles The project budget has to be in line with the principles of economy, efficiencyand effectiveness • The principle of economyrequires that the resources used by the institution for the pursuit of its activities shall be made in due time, in appropriate quantity and quality and at the best price 6

  7. Main budgetary principles • The principle of efficiency is concerned with the best relationship between resources employed and results achieved • The principle of effectiveness is concerned with attaining the specific objectives set and achieving the intended results 7

  8. Ineligible costs • Debts and provisions for losses or debts • Interest owed • Items already financed in another framework (double financing) • Purchases of land or buildings 8

  9. Ineligible costs • Currency exchange losses • Taxes (exceptemploymenttaxes, social security charges), including recoverable VAT • Credits (loans) to third parties • Fines, financial penalties and expenses of litigation 9

  10. Humanresources Includes only the cost of the staff of the Beneficiary and the project partner(s) assigned directly to the projectonbaseofemployment (labour) contract– salary (including taxes, health insurance and other remuneration related costs due in the respective country) 10

  11. Humanresources • Pay attention: • Please do not exceed rates and workload stated in the FAF • Prepare copy of contracts, orders and other supporting documents • Start filling-in the timesheet from the very beginning 11

  12. Travelcosts • Costs can include - flight, train and bus tickets (economy class), fuel for a car, rent of vehicle for travel, visa and travel insurance costs, accommodation (hotel expenses), local transportation within the place of mission • Only costs for staff and participants can be covered • Subsistence costs may be paid directly to travel agencies(i.e.the hotel) or to the persons (reimbursement sheets or pay slips) 12

  13. Travelcosts • Costs may not exceed those normally borne by the Beneficiary or partner; • Any flat-rate for the subsistence (Daily allowance, per diems) must be in accordance with national legislation and not exceed the rates set out in the project budget and published by the European Commission at the time of signing the contract. http://ec.europa.eu/europeaid/work/procedures/implementation/per_diems/index_en.htm 13

  14. Travelcosts Supportingdocuments: • Invoice from travel agency, including proof of payment; • Original transportation tickets (plane, train, boat), • Boarding passes, 14

  15. Travelcosts • Meeting or event related documents: agenda, list of participants, materials, pictures, organisation's internal documents (orders etc.) NB! Subsistence costs under “Human resources” may be paid to staff or to participants of seminars and conferences. Any subsistence cost to external experts has to be included in the contract of particular expert under Budget Heading 5 “Other costs and external services” 15

  16. Equipment and supplies The purchase or rental of equipment and supplies (new or used) is eligible if it is specifically neededfor the purposes of the project The cost of related services, such as transportation or installation is also eligible. The costs have to correspond to market rates 16

  17. Equipment and supplies • All equipment must be procured according to the nationallegislation • Every co-financed piece of equipment must comply with the information and publicity rules • NB! The production equipment, which is used for the profit generation is not eligible under the Programme 17

  18. Equipment and supplies Supporting documents: • Documents related to the award procedure, including a contract and a purchase order. They have to give evidence of the market rates (atleast 3 proposalsmustbecompared) • Proof of delivery • Invoice from contractor and proof of payment 18

  19. Direct local office costs Costs which are invoiced directly to the project - costs of the local office in case a separate office is rented for the needs of the project, office running and transport costs (rent or lending of a car used by the project on daily base) 19

  20. Direct local office costs • The activity reports have to indicate which is the staff working in the local office and its tasks have to correspond to its cost. The cost has to be reasonable and according to the principle of efficiency • Rent of a separate office is rather exceptional and its need has to be clearly justified 20

  21. Direct local office costs Supporting documents: • Documents related to the award procedure (procurement) • Invoices from contractors and proof of payment The cost of the headquarters of the beneficiary and partners has to be financed through the administrative costs 21

  22. Other costs and external services All services/works sub-contracted to an external service provider based on the applicable public procurement procedure, such as: • Audit • Visibilityactivities • Bankservices • Externalexperts • Otherservices 22

  23. Other costs and external services The Beneficiary and the project partner(s) as well as associates are not allowed to sub-contract each other 23

  24. Other costs and external services Supporting documents: • Documents related to the award procedure • Proof of delivery of services • Invoices from contractors and proof of payment 24

  25. Other costs and external services Supporting documents: • Materials published • Proof of respect of the rules for visibility • Additional specific to action documents 25

  26. Infrastructure • Works and services related to construction, renovation, installation of infrastructure aswellas supervision costs (according to national legislation) • Investments co-financed by the Programme should be aimed at public use during the project implementation, i.e. their use can not be limited only to the partners of the project 26

  27. Infrastructure Relevant project partner has to be the owner of the land and/or have the building rights on the land 27

  28. Infrastructure Supportingdocuments: • Documents related to the award procedure • Proof of infrastructureworkscompleted • Invoices from contractors and proof of payment 28

  29. Infrastructure Supportingdocuments: • Proof of respect of the rules for visibility (onthesight) • Proof of respect of the rule of nationality and origin (for materials) 29

  30. Administrativecosts • Indirect administrative costs are related to office running for the purposes of the project (electricity, heating, consumables, Internet costs…) • Indirect costs are eligible if they do not include costs assigned to another heading of the budget • The flat rate does not need to be supported by accounting documents 30

  31. In-kind Unpaid voluntary work and use of the Beneficiary’s and/or the project partner’s own premises for implementation of the project activities (max 10% from the total project budget and not exceed own funds). Unpaid voluntary work must be: • essential to the project • based on a written agreement 31

  32. In-kind • proved by timesheets indicating the hours worked for the project and signed by the volunteer and his/her supervisor • minimum monthly or hourly official national net salary level is followed when calculating the value of in-kind contribution • Ifusingown premises – organisation’s order must be prepared, stating general rent cost for the premises. 32

  33. Supportingdocuments 33

  34. Supportingdocuments 34

  35. Supportingdocuments 35

  36. Contingency reserve The contingency reserve can only be used in case of unforeseeable circumstances and with thewritten authorisation of the Joint ManagingAuthority 36

  37. 10% rule Up to 10% of the project's total budget can be spent forimplementation of the project soft activities outside the Programme area: • Costshave to beclearlyindicated, specifiedandjustifiedinreports 37

  38. Double financing • No single project and activity may be financed by more than one European Community grant • The project activities duplicated those already financed from any EU fund, international, national, regional and/or local funds are not eligible as this is considered double-financing 38

  39. JTS contacts Thank You for Your attention! www.estlatrus.eu Email:info@estlatrus.eu Phone: +371 6750 9524 Address: Ausekla Str. 14-3, Riga 39

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