volvox finance 2 how we will manage the finance angela pettit – contracts officer

Volvox Finance 2

How we will manage the FinanceAngela Pettit – Contracts Officer

Principles

• IT’S YOUR BUDGET

The EC• Volvox is Unique

• Large Subcontractor

• We will follow EC Financial Guidelines

• ftp://ftp.cordis.lu/pub/documents_r5/natdir0000074/s_2034005_20041008_154155_2034en.pdf

• They are Draft!

EC

• A “light touch”

• BUT

• Prove we are spending EC money effectively

•AUDIT

Coordinator’s role

• To act as intermediary between Consortium and Commission (ESTI)

• To pay money to the Partners promptly

• To ensure that reports – including financial statements and audit certificates are submitted promptly.

Reporting

• Annual reporting to ESTI

• Six monthly internal reporting.

Eligible costs 1

• Actual, economic and necessary

• Determined by usual accounting principles

• Incurred during the project

• Recorded in the accounts.

Eligible costs 2• Actual

– REAL costs (not estimated)

• Economic– “good housekeeping”

• Spending public money effectively

• Necessary– Directly linked to subject matter and scope of

the project.

Usual Accounting Principles

• There are no cost categories therefore

– Use the usual definitions for your Institution.

• Use your rules for Depreciation

• Use your definition of Consumables.

• You cannot have a specific set of EC definitions.

Direct Costs

• Directly related to the project which can be clearly identified and justified by the accounting rules and principles of the contractor.

Additional Costs

• These are the direct costs which are

additional to the recurring costs.

Additional Costs Employees• Direct Costs of personnel shall be limited to

the actual costs of the personnel assigned to the project where the contractor has concluded with the personnel– A temporary contract for working on

Community RTD projects– A temporary contract for completing a

doctorate– A contract which depends in full or in part upon

external funding in addition to the normal recurring funding of the contractor.

Indirect Costs• Those costs which are not directly related to the

project, not identified as direct costs and which do not include costs already directly charged to the project.– General administration and management– Office or lab space, inc rent and depreciation on

buildings and equipment, water, heat…– Communications expenses, network connection

charges– Common office equipment – Miscellaneous recurring consumables.

Volvox

• Reporting.

Periodic Reports• Submitted by electronic means and by mail

45 calendar days from the end of the period i.e. annually

• Reports consist of – Activity Report– Management Report– Financial Statement– Audit Report.

Activity Report 1

• Overview of the activities carried out

• Description of progress towards the objectives of the project

• Description of progress towards the milestones and deliverables foreseen

• Identification of any problems encountered and the corrective action taken.

Activity Report 2

• An updated plan for using and disseminating the Knowledge shall be included as a separate part of the Activity Report.

Activity Report 3

• Overview of the activities carried out

• Description of progress towards the objectives of the project

• Description of progress towards the milestones and deliverables foreseen

• Identification of any problems encountered and the corrective action taken.

Activity Report 4

• An updated plan for using and disseminating the knowledge shall be included as a separate part of the activity report.

Management Report 1

• Justification of the resources deployed

• This should possess the following qualities

that render the information useful to any

reader.

Management Report 2

• Understandable

– Avoid overly complex formats

– Present information fully, clearly and precisely

• Relevant

– Covers the full nature and extent of the financial activity.

Management Report 3

• Reliable

– Accurate, free from bias, complete and

verifiable

• Timely

– The most recent information available

– Cover the period in question.

Management Report 4

• Consistent

– Use the same basis each year

• If this changes this must be fully explained

• Comparable– The basis for accounting and presentation and

the effect of any changes from one period to the next, should be highlighted and clearly explained.

Management Report 5

• Material

– Insignificant events can be disregarded.

Form C, the Financial Statement• Standard form for all contractors

• All costs must be in Euro– Either

• Convert at the rate that would have applied on the date the costs incurred

• Rate applicable on the first day of the month following the end of the reporting period

• Use same basis for the whole project and state which

• Rates can be found at – http://www.ecb.int/stats/eurofxref/

Summary Financial Report

• Reading has to create a consolidated report

of all the Forms C

• Reading has to make a report of the funds distributed.

Audit Certificate

• This is a certification of the costs claimed

• Must be carried out by– External auditor qualified to carry our statutory

audits of accounting documents

– For a public body a public competent officer

– Must be independent of the Contract.

Commission Review

• The annual review assess the progress of the project and the prospects for achieving its overall objectives

• The Commission indicates the results of the review and recommendations. The consortium may then submit revised objectives.