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Financial Management and Auditing Reporting by the Lead Partner 3 rd round operations

Financial Management and Auditing Reporting by the Lead Partner 3 rd round operations Rostock , 03 . 02 .2005 Elise Oukka. Reporting by the Lead Partner. TWO KINDS OF REPORTS TO THE JTS: Preparation cost report Progress report

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Financial Management and Auditing Reporting by the Lead Partner 3 rd round operations

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  1. Financial Management and Auditing • Reporting by the Lead Partner • 3rd round operations • Rostock, 03.02.2005 • Elise Oukka

  2. Reporting by the Lead Partner • TWO KINDS OF REPORTS TO THE JTS: • Preparation cost report • Progress report • In addition the LP has to ensure the proper financial management of the whole operation (monitoring constantly and carefully the partner budgets & activities)!

  3. Reporting by the Lead Partner INTERREG IIIC NORTH The JTS checks the report and if needed will ask further details. When the report is approved, the payment will be executed to the LP. check check The Lead Partner checks the partner reports and compiles one joint Progress report (= Activity and audited financial report)on all costs of the operationand sends it to the Managing Authority (MA)/JTS. Partner Lead Partner Partner Partner All the partners submit an audited report to the LP on their own costs

  4. Reporting by the Lead Partner check INTERREG IIIC North Every six months:RFOActivity and audited financial reportto the MA/JTS Activity and audited financial reportconcerning the own activities and expenditure to RFO Lead partner Lead Partner Regional Partner Regional Partner check AUDITING Activity and audited financial reportto RFO level check Lead participant Lead participant Lead participant Activity and audited financial report to Lead Participant Pt Pt Pt Pt Pt Pt Pt Pt Pt

  5. Financial Reporting The reported expenditure: • has to be paid out during the reporting period • has to be eligible • INTERREG IIIC rules, EU rules, national rules • has to be assigned to the correct budget line • CHECK the current budget status – does budget line exist/ • is there still budget left? • has to be documented • e.g. for personnel costs time sheets

  6. Financial Reporting Staff costs = personnel costs for partners of the operation = salary, tax, employer’s contribution for social security in accordance with national legislation = based on real costs (actual salary rate) = certified on the basis of documents like contracts, time sheets, payslips and other documentation of payments

  7. Financial Reporting Calculation of Staff Costs (example) Hours spent on project activities (see time sheet): 120 Employees gross salary: EUR 50,000.00 Employer’s contribution: EUR 25,000.00 Total costs: EUR 75,000.00 Hours worked per year : 1700 h Hourly rate: total costs/hours worked per year EUR 44.12 Staff costs to be reported: Hourly rate*hours spentEUR 5,294.12

  8. Financial Reporting Administration Costs • linked to the operation • administration costs linked to services provided by external experts must be reported under the budget line “External Expertise” • all direct general costs (office rent, mail, fax, phone, heating, • electricity etc.)

  9. Financial Reporting Administration Costs Indirect general costs (overheads) • related to the operation • based on real costs • calculated on a pro rata basis, according to the duly justified, fair and equitable method • documentation of the calculation method!

  10. Financial Reporting Travel and Accommodation • have to be in accordance with the existing internal rules of the LP and partner organisations and national rules • of the respective Member State • based on actual costs • in case of subsistence costs, payment on a daily allowance • basis possible if this is foreseen in internal rules of the • organisation and payment evidence available

  11. Financial Reporting External expertise • Has to be consistent with the specification provided in the application • No new items can be added in the report! • Public procurement • Documentation (contracts, invoices etc) • Subcontracting of partners is not allowed!

  12. Financial Reporting Investments • Have to be consistent with the specification provided in the application • No new items can be added in the report • Reporting either as a total amount or as depreciations • (national rules!) • Documentation; invoices, depreciation method etc.

  13. Financial Reporting Other costs • Has to be consistent with the specification provided in the application • No new items can be added in the report! • Documentation

  14. Financial Reporting Common costs • Sharing of management and coordination costs among partners • Transparent, fair and equitable method • WRITTEN AGREEMENT! • Clear accountancy & reporting  no double reporting! PLEASE NOTE: In most cases, it should be possible to share the activities by sharing responsibilities equally among partners

  15. LESSONS LEARNED FROM THE PREVIOUS REPORTS • Ignored error messages • Clarifications on the activities (e.g. vs. expenditure incurred) • Clarifications on the expenditure (e.g. vs. application’s budget lines and specifications) • Clarifications on the involvement of the partners (activities vs. expenditure) • Signatures wrongly dated – auditor should sign only after the Lead Partner has signed!

  16. THANK YOU FOR YOUR ATTENTION!

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