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Financial Framework FP6

Understand FP6 Contract Structure & Instruments. Learn about consent, accession, financial statements, subcontracting, financing, receipts, audit certificates in project operations.

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Financial Framework FP6

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  1. Financial Framework FP6

  2. Contract structure & instruments

  3. Contract Structure • Annex IV - Form A Consent of contractors identified in the core-contract (article 1.2) to accede to the contract. To be signed by the contractor concerned and by the coordinator. • Annex V - Form B Accession of new legal entities to the contract. To be signed by the new contractor concerned and by the coordinator • Annex VI - Form C Financial statement per activity. Specific to each Instrument and/or type of action. To be filled periodically by each contractor

  4. Coordinator • A contractor among other contractors • No leadership • No additional rights BUT • Additional obligations • Administrative tasks: single entry point for communication, payments, reporting etc.

  5. Third parties identified in Annex I • In most of the cases they do not participate, they simply make their resources available to a contractor, this is not a case of participation but only a question of eligibility of the cost of these resources • In exceptional cases: “participation” of members of entities such as EEIG,UMR, SMEs Associations: • these entities are contractors (EEIG, UMR) • their members can do some of the work on the project even though they are third parties • contractor and third parties must have a previous agreement, normally the constitution • the third parties, the agreement and the tasks must be identified in Annex I

  6. Subcontracting • Contractors shall ensure that the work to be performed can be carried out by them. • Exception: where it is necessary to subcontract certain elements of the work, this should be clearly identified in Annex I. • Minor services may be subcontracted: • which do not represent core elements of the project • which cannot be directly assumed by contractors • where necessary for the performance of the project

  7. Financing : what ? Community FinancialContribution (Arts 5 and II.24) • Based on a calculation method • Based on activities: Articles II.2 and II.25 • Based on costs:Articles II.19, II.20 and II.21 • Based on costs reporting models: Art II.22 • Confirmed by an audit certificate: Art II.26

  8. Financing: calculation method Grant for integration Grant to the budget Flat-rate Networks of excellence  Integrated Projects  Specific targeted research projects  Coordination actions  Specific support actions  

  9. Financing: type of activity • Research and technological development (including innovation related activity) • Demonstration • Training • Other specific support activities • NewConsortium Management : costs reimbursed up to 100% within the limit of 7% of Community contribution

  10. Financing: costs • New principles: • 1 - cost categories are replaced by conformity to contractors’ own accounting rules and legal environment • 2 - simplify the eligibility criteria • 3 - focus resources on the reality and the necessity of the cost, rather than on formality (cost categories) • Therefore, costs must be : • actual, economic and necessary for the project • incurred during the duration of the project (exception: costs of the final reports) • recorded in the accounts(or third parties) • and must exclude indirect taxes, duties, interests, costs reimbursed in respect of another Community project, and not give rise to profit

  11. Financing: receipts (a) • Three kinds of receipts must be taken into consideration in order to avoid any possibility of profit: • Financial transfers or their equivalent to the contractor from third parties ; • Contributions in kind from third parties; • Income generated by the project. • In the first two cases (financial transfers or contributions in kind), these endowments are considered as receipts of the project if the third party has provided them specifically to be used in the project. • If, on the other hand, these endowments are at the discretion of thecontractor they are not to be considered as receipts.

  12. Financing: receipts • In thefirst two cases, where contributions from third parties are used for the project by the contractor, the latter is required toinformthe third party of this use and in accordance with the national legislation or practice in force. • In the case of income generated by the project itself: • General rule: any income generated by the project itself, including the sale of assets bought for the project, are considered as income to the project (receipts) • Derogation: income generated by the use of the knowledge resulting from the project is not considered as a receipt

  13. Financing: audit certificates • each contractor shall provide an audit certificate prepared and certified by an external auditor (for public bodies - competent public officer) • to transform an advance into a final payment • Based on the reporting periodicity of the contract (see next section) • for IP/NoE : every 12 months • other instruments: periods to be negotiated - at least one at the end • where requesting a Community financial contribution exceeding 750.000€ for a specific reporting period, even though an audit certificate is not required for this specific period

  14. Reporting periodicity • The project is divided into reporting periods of 12 months for IP and NOE • For other instruments, reporting periods are established on an ad hoc basis in the contract • P1: from month 1 to month X • P2: from month X+1 to month Y • P3: from month Y+1 to month Z • final: from month N+1 to the last month of the project

  15. Payment modalities • The Community financial contribution shall be paid in accordance with the provisions of Article 8 and II.28. Differences between: • 1] one single reporting period • 2] several reporting periods - with an audit certificate for each period - without an audit certificate for each period

  16. Payments and reporting schedule for an IP(example of a 4 year contract) Activity report Final payment Certified costs Activity report Detailed work plan Certified costs Payment + new advance Activity report Detailed work plan Certified costs Payment + new advance Activity report Detailed work plan Certified costs Payment + new advance Detailed work plan Initial advance 0 6 12 18 24 30 36 42 48 Months

  17. Payments and reporting schedule for a STREP, I3, SMEs project CA or SSA(example of a 3 year contract) Final activity report Final payment Certified costs Intermediate advance or payment + advance Periodic activity report (mid-term review : optional) Reported costs OR certified costs Detailed work plan Initial advance 0 6 12 14 18 20 24 26 30 36 38 Months

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