OUT-IN: O rganising, U sing and T ransferring IN novation LLP-LDV/TOI/07/IT/017

1. OUT-IN: Organising, Using and Transferring INnovation  LLP-LDV/TOI/07/IT/017 LLP ADMINISTRATIVE AND FINANCIAL RULES INTERIM AND FINAL REPORT Second transnational workshop Riga, 12th - 13th January 2009 Venue: Nordic Hotel Bellevue (Riga)

2. SECTION A GENERAL PROVISIONS

3. Project total budget

4. LLP Programme funding procedure LLP Grant from NA to Project Promoter The National Agency for LLP Programme will transfer to Project Promoter (MCG) the project amount correspondent to the LLP Grant approved (euro 279.510,00) through 3 different tranche of payment: - 1st tranche 40% of total LLP Grant: Euro 111.804,00 after 45 gg from the signing of the Agreement between National Agency and Project Promoter and the submitting, on the side of the promoter, of financial guarantee; - 2nd tranche 30% of total LLP Grant: Euro 83.853,00 after 45 gg from the submitting of the Interim report to the National Agency; - 3rd tranche 30% - balance after the submitting of the Final Report to the National Agency and validation of the expenses declared. The total balance will depend on the amount of costs that will be valuated as eligible.

5. LLP Programme funding procedure LLP Grant from Project Promoter to All partners • After the signing of agreements between Project Promoter (MCG) and all partners (2 copies) and after that the Project Promoter has received each tranche from the National Agency, the relative tranche will be transferred from the Project Promoter to each partner. • 1st tranche 40% of total LLP Grant foreseen in each partner’s own budget and ruled in the agreement between Project Promoter and Partner • After having received the 1st tranche from the NA; • - 2nd tranche 30% of total LLP Grant foreseen in each partner’s own budget and ruled in the agreement between Project Promoter and Partner • After having received the 2nd tranche from the NA; • - 3rd tranche 30% - balance • After having received the total balance calculated by the NA on the base of the total amount of costs valuated as eligible.

6. On the bases of LLP Programme rules, all projects are requested to submit to the National Agency in Charge for Technical Assistance and Monitoring two main Financial Reports that include also the Activities report and the presentation of related outcomes and outputs: - The Interim Report (after 12 months) - The Final Report (at the end of the project)

7. The Interim Report Project period concerned The Interim Report is the 1st Official Check Point on the project work in progress requested by the National Agency (NA) The Report concerns the first 12 months of project implementation. The period concerned by our financial interim reporting will be from the 5th December 2007 to the 4th December 2008, But the deadline to submit the Interim Report to the NA is the 14th March 2009. .

8. It is important to know that the Interim report is articulated in two main sections: • Activities report (word file) • Financial report (excel file) • The related formats to be filled in will have been provided by the National Agency to the project promoter. • All partners are requested to use only the official financial format (excel file) sent by the promoter to account the expenses covered during the first year of project implementation.

9. In general, the activity reporting (word file) is under the responsibility of the promoter. Partners will be asked only to provide some specific information (e.g. Dissemination activities realised) that will be used by the promoter to make the complete report on project activities realised.

10. The Activity report implies: • The description of all activities realised • The description of all outcomes achieved and outputs realised. • All outputs (project products) realised have to be printed and annexed to the report. • Also dissemination products are considered project outputs so, please remind to send to the promoter all dissemination products you have used or realised (e.g. CD, reviews, newsletters, etc.). • If you have these products on file (*pdf, word, etc.) just send them by e-mail. If you have printed material, send it by post courier.

11. The Interim Report Object of the NA evaluation The Interim Report is the check point to be passed to receive the 2nd financial tranche of the project total budget LLP Grant (30%) from the National Agency (the first tranche transferred at the beginning of the project is equivalent to the 40% of the total budget – LLP Grant). The National Agency will evaluate the Interim Report provided by the project with respect to: some Assessment Principles; the total amount of costs declared by the project on the whole: after 12 months, in fact, we are supposed to have spent at least the 70% of the total amount that the project have received with the 1st tranche (40% of the project total budget). If the project has spent less of the 70% of the 40%, the 2nd tranche transfer will be equal to the % of costs declared and evaluated as eligible.

12. ! Pay attention Financial Reporting (Interim and Final) in LDV are referred to the project Total Cost and Budget. It means that to receive the 2nd tranche (30%) and the final balance after the end of the project (30%), all partners must contribute with their own expenditures (the project total expenditures are the sum of the expenditures made by each partner). Financial reporting is related to the activities realised by the project on the whole. So each partner must consider itself as a part of a project partnership contributing: to the achievement of all activities planned and so, to the achievement of the minimum financial ceiling expected (70% of 40% only for the Interim Report).

13. The Interim Report NA Assessment Principles The PRINCIPLE guiding the ASSESSMENT of the Interim Report is the CONFORMITY among aims, products and costs planned and realised. • therefore, • Aspects evaluated by the National Agency will be: • Level of achievement of the aims stated • Products realised compared to products expected • Quality of contents, outputs and outcomes • Consistency of expenditures declared with all that has been realised

14. General Rules for a successful Interim Report Cooperate to ACHIEVE THE OBJECTIVES Cooperate to REALISE THE PLANNED PRODUCTS SPEND AT LEAST 70% of the 1st tranche of LLP contribution received

15. Financial Accounting At FINAL REPORTING, THE PERIOD CONCERNED BY THE FINANCIAL REPORT WILL BE THE TWO-YEARS OF PROJECT IMPLEMENTATION (24 months). It means that the Final reporting will concern all expenditures actually made by each partner from the 5 December 2007 to the 4th December 2009. In this case each partner will have to provide the Contractor with all documents justifying all expenditures declared, with respect to the rules of the LLP Programme and the deadlines foreseen in the subcontract signed with the Contractor.

16. Operative Direct Costs The eligible direct costs of the action are those directly linked to the execution of the project. They are subdivided in specific categories foreseen in the project total budget approved. Indirect Costs The indirect costs of the action eligible for Community funding is a flate rate amount set at maximum 7% of the total amount of eligible direct costs. The corresponding costs need not be justified by accounting documents

17. Expenses are considered eligible according to: • Progress of the project • Supporting documents provided (receipts/invoices) with respect to the Programme rules • Conformity to Programme Administrative and Financial rules

18. SECTION B DETAILED INFORMATION HOW TO MAKE THE FINANCIAL REPORT AND TO FILL IN THE TABLE PROVIDED (EXCEL FILE)

19. Eligible Costs: Direct Costs Direct Costs are those which are identifiable as specific costs directly linked to the project realisation. They include 5 specific categories: • Staff costs • Travel and Subsistence Costs • Equipment Costs • Subcontracting Costs • Other Costs

20. Eligible Costs: Indirect Costs • They are not identifiable as specific costs directly linked to the project realisation, but which have nevertheless incurred in connection with eligible direct costs. They may not include any eligible direct cost. • Examples for indirect costs are: • All costs for equipment related to the administration of the project • Communication costs (postage, fax, telephone, mailing) • Infrastructure costs (rent, electricity) of the premises where the project is being carried out • Office supplies (paper, CD, DVD) • Photocopies

21. ... But when costs are considered “Eligible”? • To be considered as eligible costs of the project, costs must satisfy the following general criteria: • to be directly linked to the object of the Agreement signed with the National Agency for LLP Programme and included in the project Budget approved; • to be necessary for project realisation and connected with the project (i.e. relevant for the project and be directly connected with the execution of the project in accordance with the work plan); • to be reasonable and justified and must accord with the principles of sound financial management, in particular in terms of value for money and cost – effectiveness; • to be generated during the lifetime of the project; • to be actually incurred by the beneficiaries (partner); • to be identifiable and verifiable; • to be related to activities involving the eligible countries in the Programme.

22. ... And when costs are considered “Not Eligible”? • Under no circumstance can the following types of costs be considered as eligible: • return on capital; • debt and debt service charges; • provisions for losses or potential future liabilities (provisions for contractual and moral obligations, fines, financial penalties and legal costs); • interest owed; • doubtful debts; • exchange losses; • VAT, unless the applicant can show that he is unable to recover it (by declaration); • costs declared by the applicant and covered by another action or work programme receiving a community grant; • excessive or reckless expenditure; • purchase of capital assets; • in the case of rental or leasing of equipment, the cost of any buy-out option at the end of the lease or rental period; • costs of opening and operating bank accounts; • costs incurred in relation to any document required to be submitted with the application; • costs related to “silent partners” involved in the project.

23. 1. Staff costs: definition “…comprise any salary and/or remuneration paid to persons employed by a partner organisation or working regularly or recurrently for the project. This figure should include salary costs (for salaried and other personnel) which is paid under the personnel budget (for normal accountancy purposes) plus all the usual contributions paid by the employer, such as social security contributions, social fees, holiday payments and pension costs but must exclude any bonuses, incentive payments or profit-sharing schemes.” This figure must not include costs relating to persons undertaking subcontracted tasks.

24. ! How to account staff costs Staff costs must be accounted considering the real daily staff cost rates, but these rates cannot exceed the maximum rate indicated by the Community per category (Managers, Technical, Researchers, etc.). Real daily staff cost rates are based on average rates corresponding to the applicant’s usual policy of remuneration, comprising salaries plus social security charges and others statutory costs included in the remuneration. These costs result from multiplying the number of days with the real daily staff cost rate, referring to each person representing each professional category. Not statutory costs like bonuses, lease car, expense account schemes, incentive payments or profit-sharing schemes are excluded.

25. ! Pay attention Staff costs are those relating to the following categories: Statutory staff, having either a permanent or a temporary employment contract with the partner. Temporary staff, recruited through a specialised external agency. Costs related to staff working through subcontracting shall be included under the category “Subcontracting costs”. Staff members of Project partners are not allowed to operate in a subcontracting capacity for the project.

26. ! Pay attention • Please remind that you do not have to attach evidences of the staff cost declared, since Staff Costs are not submitted to a detailed financial report. In any case it could happen that the National Agency would ask the Promoter, and to all partners, to look over some specific administrative and financial documents. • Therefore, it is necessary that all partners have available in any moment, all kind of documents useful to support the reporting of expenses declared, as for example: • invoices or wage packets, • contracts for collaboration, • time sheets, • internal service order.

27. ...to sum up • When accounting staff costs, please remind to: • refer to the actual salary for each professional figure involved in the realisation of project activities; • provide, for each person, the date of start and end of the involvement of the person on project activities (consistently with start/end date of project. In this case please refer only to one year of project implementation); • indicate number of working days spent on project activities for each person; • indicate the real salary per day, for each person; • cover the total amount (LLP grant + own funds) available for staff costs in your own budget. STAFF COSTS ARE REPORTED FILLING IN THE TABLE G3 (See EXAMPLE following)

28.  Staff costs – Table G3  example

29.  VERY IMPORTANT NOTE (TABLE G3 STAFF COSTS) When reporting staff costs using the Table, you have to remind that: The final total cost you declare must result from LdV grant + own funds = total amount of staff costs e.g. if your own budget is: You have to account personnel for 37.599,00 Euro. Obviously, for the Interim report you do not have to spend the total amount available for staff costs, but only a part of it. The rest will be accounted at Final Reporting (end of project) Please remind that in general the persons who travelled (e.g. to participate to project workshops or meetings) and that you have indicated in table G4 - Travel costs - must be included in the list of the Table G3). Otherwise you have to declare that the person x who travelled to y is part of the internal staff involved in the project but you have decided not to charge it on staff costs. It is not possible to charge travel costs of external experts on Table G4 (they have to be charged on “other costs” or “subcontracting” consistently with the figures you have in your budget voices.

30. ...further information • Since staff costs generally do not require accounting documents to be justified, the National Agency, in occasion of Interim and Final report, askSall partner to attach to the staff costs account a declaration signed by the Legal Representative, stamped and dated, in which the organisation describes for each professional figure (administrative, managers, technicians, etc.) the detailed composition of the daily salary indicated. • It means that for each professional figure the cost implies, as example, the following items: • Ordinary salary • Social security contributions • Social fees • Holiday payments • Pension costs • Etc….. • Please remind that bonuses, incentive payments or profit-sharing tasks must be excluded from the staff costs.

31. 2. Travel and subsistence costs They imply journeys directly linked to the project activities foreseen in project workplan. Journeys are strictly referred to the internal staff of each organisation partner. Subsistence costs must not exceed maximum daily subsistence rates per country defined in the administrative-financial guide for the LLP Programme. TRAVEL AND SUBSISTENCE COSTS ARE REPORTED IN THE SAME TABLE (See Example TG4 following)

32. Travel costs Travel costs for staff taking part in the project considered, provided that they are in line with partner’s usual practices on travels costs. Costs may be claimed only for journeys directly connected to specific and clearly identifiable project-related activities. Reimbursement is based on real costs, independent of the means of travel chosen (rail, bus, taxi, plane, hire car). Partners are required to use the cheapest means of travel (e.g use Apex tickets for air travel and take advantage of reduced fares, where this is not the case then a full explanation should be provided). For information on charging Travel costs for non-staff members, please refer to “Other Costs” and “Subcontracting Costs”.

33. ! How to account travel costs The travel cost for a journey should include all costs and all means for travel from the point of origin to the point of destination (and vice versa) and may include visa fees, travel insurance and cancellation costs. If, as a member of the partnership, you are participating to a meeting and, so, travelling, please remind, when accounting your travel: A - to provide all detailed information requested as: • Name of the person/persons who travelled (they should be part of the staff declared in accounting staff costs); • Place of origin and place of destination; • Period concerned (from _ to_); • Total days spent (please remind that a Full day includes an overnight stay, so calculate days referring to numbers of nights); • Object of the travel (e.g. 1st transnational workshop); • Travel costs (all tickets for transports from/to the airport e.g. train, flight but also taxi); • Subsistence costs (accommodation, local transports, meals).

34. ! How to account travel costs B – To attach to your report a copy of each of the following items per travel: • Boarding cards of all travels reported and evidence of the payment made (example: invoice of the travel agency or copy of the ticket with the related cost); • Invoices or receipt of all meals, dated; • Receipt of taxis, bus, underground, etc, dated; • Invoices of all hotels, including check in and out date, number of nights, name of the person.

35.  Further information on Transport type ! How to account travel costs Expenses for private car travel (personal or company cars), where substantiated and where the price is not excessive, will be refunded as follows: • either a rate per km. in accordance with the internal rules of the organisation concerned up to a max of Euro 0,22; • or the correspondent price of a rail, bus or plane ticket. Only one ticket shall be reimbursed, independently of the number of people travelling in the same vehicle. For hire cars (maximum category B or equivalent) or taxis: the actual cost where this is not excessive compared with other means of travel (also taking account of any influencing factors i.e. Time, excessive luggage). Reimbursement take place independently of the number of people travelling in the same vehicle (it means that will considered 1 person only).

36.  Further information on Transport type ! How to account travel costs • TRAINS or underground/bus ticket airport-hotel (A/D) are to be reported as travel. • TAXI, from the airport to the hotel or to the airport to Home, are to be declared as travel. • Taxi or bus or underground for short trips inside the city, are to be reported as subsistence and so are included in the maximum rate per day. • Please remind that in the taxi invoice must be clearly indicated: • Itinerary • Date • Total amount

37. Subsistence costs Subsistence costs are for staff taking part in the action. As far as subsistence costs are concerned (hotel + meals + local transports) the maximum of the costs eligible in a country are fixed by the European Community. If the amount spent per day overcomes the maximum eligible, the balance won’t be financed. The rate applied is the one from the destination country, i.e. Where accommodation costs are incurred. For information on charging subsistence costs for non-staff members please refer to “Other cost or Subcontracting costs”. * Accordingly to the Maximum eligible daily rates recently revised by the EC.

38. Subsistence costs Costs may be claimed only for journeys directly connected to specific and clearly identifiable project-related activities. Reimbursement is based on the existing internal rules of the partner organisation, which may be on an actual cost (reimbursement of receipts) or daily allowance basis. In either case, proof of attendance and overnight accommodation will be required to substantiate declared costs at reporting stage. Subsistence rates cover accommodation, meals and all local travels costs (but not local travel costs incurred to travel from point of origin to point of destination). In calculating the number of days for which to apply the daily subsistence rate it should be noted that a FULL day normally includes an overnight stay.

39. Travel and Subsistence figures Referring to travel and subsistence costs, the figures included in our project budget are the following: ALL THIS FIGURES REFER TO TRAVELS MADE BY INTERNAL STAFF ONLY

40.  Table G.4 – Travel and subsistence costs  example *1 Travel for 1 person (2 ways are implied!!!!!!!) ** to calculate duration you have to refer to the number of nights spent in the City *** the amount indicated is the total of Airplane + taxi + underground. PLEASE DO NOT SPLIT THIS VOICES SINCE THEY REFER TO THE SAME TRAVEL: YOU HAVE TO SUM THEM AND TO INDICATE THEM IN THE SAME LINE OF THE TABLE.

41. 3. Equipment costs • 1. Purchase, rent or lease of equipment (new or second-hand), including the installation, maintenance and insurance costs, is considered: • only when specific and necessary for achieving the goals of the project/action. Equipment costs must always be duly justified; • provided that it is written off in accordance with the tax and accounting rules applicable to the beneficiary and generally accepted for items of the same kind. Only the portion of the equipment’s depreciation corresponding to the duration of the action and the rate of actual use for the purposes of the action may be taken into account. • 2. All equipment related to the administration of the project (i.e. PC’s, portables, etc.) and all equipment purchased before the start of a project is covered by indirect costs. ! Please note that: No equipment costs are foreseen in our project budget

42.  example  Table G.5 –Equipment

43. 4. Other costs • They imply all costs: • Not covered under any other budget heading • Necessary to project activities • 1- In particular are costs arising directly: • from requirements imposed by the grant agreement are eligible (dissemination of information, specific evaluation of the action, audits, translations, reproduction, etc.), including the costs of any financial services (especially the of financial guarantees); • from the realisation of specific actions or of products/results of the project are eligible (i.e. the organisation of seminars – when they are foreseen as a product/result and where the task-related costs are easily identifiable -; the production of proceedings of a seminar, the production of a video, the purchase of product-related consumables – reams of paper for printing of publications, blank DVD, etc.. 2 – Only activities which are specific and necessary for achieving the goals of the project are considered. 3 – When travel and/or subsistence costs are reimbursed to third parties, the rules applicable to staff of partners will be applied.

44. Other costs: figures Referring to Other costs, the figures included in our project budget are the following:

45.  example  Table G.6 –Other Costs  Note1: do not insert the name of your organisation partner ONLY THE NUMBER AS REQUESTED and do not change the number provided under the column reference  Note 2: if you do not fill in the other columns (description, justification, cost date, etc.), the cost will be considered not eligible. PLEASE REMIND THAT ITEM AND PURPOSE MUST TO BE COHERENT WITH THE FIGURES FORESEEN IN YOUR BUDGET UNDER OTHER COSTS.

46. 4. Subcontracting costs: definition “Any amount paid to an external body or organisation [or individuals who may be self-employed] carrying out a specific one-off task in connection with the project (e.g. translation, expert consultancy, interpretation, design & printing, conference/seminar organisation)”.

47. Subcontracting costs: general info In order to maintain the concept of the project partnership, the management and the general administration of the project may not be subcontracted. Costs are based on a verifiable estimate or, if the subcontractor is identified, on the basis of an offer. The estimate/offer will cover all costs (i.e. staff costs plus travel costs) THESE COSTS MUST BE SUPPORTED BY SPECIFIC DOCUMENTS (CONTRACTS AND INVOICES) THAT MUST BE ATTACHED TO THE INTERIM REPORT.

48. ! How to account subcontracting costs For each cost declared under thevoices foreseen in subcontracting (Experts, Translations, Printing/Publishing, etc), please provide attached to your Final Financial Report the following accounting documents: • Copy of the contract stipulated with the external experts/organisations. In this case a purchase order has the same value of the agreement. • Evidence of the payment made towards the external experts/organisations providing the service (OPTIONAL). • Invoice/receipt of the external expert/organisations that provided the service.

49. ! How to account subcontracting costs Contracts (or similar documents) you stipulate need to be formulated with respect to the indications provided in the Administrative and Financial Handbook of the Programme. • Subcontracting agreements (to be provided along with relevant invoices) must include, as a minimum, the following information: • title and code of the project; • purpose of the Agreement (object); • dates on which the Agreement begins and ends; • amount to be paid; • detailed description of the costs on which this figure is based; • work schedule/completion phases; • payment arrangements (one or more advance payments, staggered payments, etc.); • clauses in respect of non-performance or late completion.

50. ! How to account subcontracting costs Please remember that all subcontracts must clearly indicate in the object that the activity requested is referred to the project “OUT-IN: Organizing, Using and Transferring Innovation”, financed within LLP Programme 2007-2013 Leonardo da Vinci Multilateral Projects - Transfer of Innovation (TOI), Project ID.: LLP-LDV/TOI/07/IT/017 All subcontracts must imply a period included within the 24 months of project life and must clearly indicate the kind of activity requested and the amount allocated. Please remind that if you do not follow the indications provided, agreements will not evaluated eligible. Please remind that is also requested a translation in English or French of all subcontracts that are in languages difficult to be understood (e.g. Latvian, German, Polish, Greek, Bulgarian, etc). Where it is not possible to conclude a full subcontracting agreement, for example, the subcontracting of printing activities, then as a minimum, evidentiary documentation (e.g. quotation or purchase orders and final invoice) should be provided and should aim to include the majority of the above information demands.