Financial management of H2020 projects€¦ · Economics and Business Administration Social...
Transcript of Financial management of H2020 projects€¦ · Economics and Business Administration Social...
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
BESTPRAC Training School: "Finance for Beginners"
Per Inge AndresenSenior adviser
NTNU ‐ Norwegian University of Science and Technology
Financial management of H2020 projects
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
NTNU – Norwegian University of Science and Technology
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
TRONDHEIM GJØVIK ÅLESUND
NTNU – 3 cities
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
NTNU – Profile
• Main profile in science and technology
• Academic breadth: humanities, social sciences, medicine, health sciences, science of education, architecture, fine arts and performing arts
• Headquarters in Trondheim with campuses in Gjøvik and Ålesund
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
NTNU – Key figures
• 8 faculties, 55 departments and NTNU University Museum
• 7 134 full‐time equivalent staff (2017)• Over 40 000 students (2017)• 6,800 completed bachelor’s and
master’s degrees (2016)• 366 doctoral degrees (2016)• Budget of ≈ € 875 Mill. (2017), of which
≈ € 210 Mill. from external sources (at current exchange rate)
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
NTNU – Students
The seven largest education areas
Over 40 000 students:o Trondheim: 85 %o Gjøvik: 10 %o Ålesund: 5 %
• Just over half are women
• 9 % international, from 121 countries
• Most first‐priority applicantsin Norway, almost 23 000 in 2017
• The university that recruits most nationally
‐ 2 000 4 000 6 000 8 000 10 000 12 000
Nursing education
Economics and Business Administration
Social Sciences
Engineering
Humanities
Matematics and Natural Sciences
Technology
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
NTNU – Research• Participating in 106 Horizon 2020 projects as of end of April 2018• Granted ≈ € 55 million from the Horizon 2020 programme so far. • Is the institution that is awarded the most funding from the
Research Council of Norway• Host or partner for 35 major research centres (SFF, SFI, and FME)• 366 doctoral degrees completed in 2016, of which 42% by
international PhD candidates• Internal initiatives to develop and recruit top researchers• Strategic research areas and enabling technologies in 2014 – 2023:
NTNU BIOTECHNOLOGY
NTNU DIGITAL NANO@NTNUENERGY HEALTH OCEANS SUSTAINABILITY
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Per Inge Andresen – Personal background
• BA in Environmental and Resources Studies and Comparative Development Studies (Joint Major)
• MSc in Economics and Business Administration• 22 years' professional experience in different fields of
research administration and management• Two periods as elected internal auditor of EARMA
(http://www.earma.org/)• MC member and member of WG Finance of the
BESTPRAC COST Action
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Agenda
• Where are we in the project life‐cycle?• Preparing for project implementation• Setting up the project in your system(s)• Payment transfers of EU funding (monitoring)• Internal project follow‐up (monitoring)• Consortium project follow‐up• Budget reallocations• Questions?
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Project implementation – Where are we in the project's life ?
• The linear project stage model• The project life‐cycle model
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
The implementation stage in thelinear project stage model
•Cost estimate•Budget
Pro‐posal
•Cost update•Budget update
Grant preparation
• Project account setup
• Info on proce‐dures
• Pre‐finance
Project start
•Book‐keeping
• Time recording
•Cost vs budget follow‐up
•Periodic report
•Budget re‐allocations
• Interim payment
Imple‐men‐tation
•Final report•Audit•Closing of accounts•Eva‐luation
Project end
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Implementation in the project life‐cycle model
Proposal
Grant preparation
Project start
Implemen‐tation
Project end
• Cost estimate• Budget
• Cost update• Budget update
• Project account setup• Info on procedures• Pre‐finance
• Book‐keeping• Time recording• Cost vs budget follow‐up• Periodic report• Budget reallocations• Interim payment
• Final report• Audit• Closing of accounts• Eva‐luation
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Grant preparation stage
• Consortium Agreement– Financial provisions– Also for MSCA's
• Financial validation• MSCA
– Fellow recruitment
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Project startup ‐ beneficiary
• Providing banking information to the Coordinator
• Establishing the project in the accounting system– Tag/label/identifier in the accounting system facilitating tracing of all project costs
• Timesheet procedures• Receiving prefinance
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Project startup – consortium
• Collecting banking information from the beneficiaries
• Distributing prefinance• Agreeing on internal reporting arrangements
– Unless it is decided in the Consortium Agreement
• Agreeing on monitoring/follow‐up procedures• Unless it is decided in the Consortium Agreement
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Implementation stage – Key tasks
• Time recording (timesheeets)• Bookkeeping• Internal monitoring/follow‐up• Reporting• Payments of EU funding
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Payments – Transfers of EU funding
• Where does the EU funding flow?• EU payment schedule• Consortium payment schedule• Simplified cash flow model
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Where does the EU funding flow?
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Categories of EU payments (H2020)Category Why? How much? When?Pre‐financing
Provide a "float" (improved cash‐flow)
Usual practise (no fixed rule):
. Exception:Projects with only 1 period* 5% of max Grant is deducted from pre‐financing for Guarantee Fund
Latest of <30 days after:a) EU signature of GAb) 10 days before starting date
of action
Interim payments
Fund costs/activities for a reporting period
Reimbursement rate * (multiplied by) approved amounts for the reporting period• Eligible costs• Flat rates• Lump sums
≈ 5 months (150 days) after end of period:1. Reporting deadline: 60 days
+2. EU report approval deadline:
90 days
Payment of the balance (final payment)
• Release funding that has been retained (withheld)
• Fund remainingcosts/activities
Retained funding:Guarantee Fund allocation (5%)Final 10% of grant (90% limit)Any remaining funding beyond this (calculation as for interim payments)
≈ 5 months (150 days) after end of action (project):1. Reporting deadline: 60 days
+2. EU report approval deadline:
90 days
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Costs and payments ‐ ExampleMaximum EU contribution (€) 3 000 000Project duration (years) : 4Number of reporting periods: 3Guarantee Fund retention rate 5 %Funding retained until EU approval of final report 10 %
Reporting periods:Start month no.
End month no.
Approved funding
P1 1 18 1 100 000 P2 19 36 1 200 000 P3 37 48 700 000 P4 ‐
Month No. 1 6 12 18 24 30 36 42 48 54 60M1 M6 M12 M18 M24 M30 M36 M42 M48 M54 M60 Total
Prefinance 1 000 000 Transfer to Guarantee Fund 150 000 Funding equivalent of approved costs for the period 350 000 350 000 400 000 400 000 400 000 400 000 350 000 350 000 3 000 000 Funding previously released by the EU 1 000 000 1 000 000 1 000 000 1 000 000 2 100 000 2 100 000 2 100 000 2 700 000 2 700 000 3 000 000 Retained by the EU for the period ‐ ‐ ‐ ‐ ‐ ‐ 600 000 ‐ 700 000 ‐ Released from the Guarantee Fund ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 150 000 ‐ Released after approval of final report ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 300 000 ‐ Funding transferred by the EU for the 850 000 ‐ ‐ ‐ 1 100 000 ‐ ‐ 600 000 ‐ 450 000 ‐ 3 000 000
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
EU Payments vs. costs per period
‐
200 000
400 000
600 000
800 000
1 000 000
1 200 000
M1 M6 M12 M18 M24 M30 M36 M42 M48 M54 M60
Cash flow ‐ costs vs. EU funding
Funding equivalent of approved costs for the period Funding transferred by the EU for the period
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Cumulative, net "cash flow"
‐1 000 000
‐500 000
‐
500 000
1 000 000
1 500 000
2 000 000
2 500 000
3 000 000
3 500 000
M1 M6 M12 M18 M24 M30 M36 M42 M48 M54 M60
Costs, EU funding and net EU transfer
Cumulative funding equivalent of approved costs Cumulative funding transferred by the EU Net funding balance
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Consortium payment schedule
• EU rules:– "The coordinator must distribute …without unjustifieddelay"
• BUT, the guidelines also say:– "How and when the payments are distributed is in principle an internal matter for the consortium"
– This is for the Consortium Agreement• This concerns the timing:
– Periods for payments, instalments, pre‐conditions for payments• …and the amounts allocated to each beneficiary:
– "distribution of the funding which is different from the costs claimed"
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Consortium payment schedule –good practise• Two main "Schools"A. Distribute all EU payments as they arrive to
the CoordinatorB. Divide the EU payments into instalments for
distribution within the consortium– More frequent transfers– Smaller amounts with each payment
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Why not transfer all EU funding "immediately"?• Additional incentive for beneficiaries to perform their tasks, including
reporting obligations• Quick adaptation to changing circumstances
– If tasks are reallocated from beneficiary A to beneficiary B, the coordinator may transfer additional prefinance to beneficiary B without waiting for beneficiary A to return EU funding
• It is not uncommon for beneficiaries to spend less than their budget• EU funding stuck with non‐performing or defaulting beneficiaries• Waiting for beneficiaries to return excess funding often takes a long
time – sometimes years• The Guarantee Fund mechanism takes time to act• The Guarantee Fund only acts when the EU is owed funding• In cases of beneficiaries owing funding to other beneficiries, the
Guarantee Fund does not act
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Project follow‐up (monitoring)
• Why monitor the project?• What to look for• Monitoring from the financial perspective• Cost budget follow‐up• Progress report
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Why monitor the project?
• Identify needs for action as early as possible– The earlier it is discovered, the easier it is to fix– Also generally less costly to fix at an early stage
• Catch things before it is too late• Once the project is finished, it is too late to change anything
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
What to look for• Ineligible costs• Incurred costs that should be, but have not been charged to the project accounts
• Significant deviations– From plan– From the budget
• "Threats" to the successful completion of the project
• Is there a need to adjust the plan or the budget?• Ideas on what adjustments to propose (if any)
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Monitoring from the financial perspective• Are there ineligible costs charged to the project?• Costs that are "missing" in the project accounts (charged somewhere else)
• Are the costs significantly higher or lower than expected?
• Are there costs that were not expected?– Not included in the budget or Grant Agreement?
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Internal financial monitoring –Levels of detail and complexityLevel
Simplified /complex?
Analytical focus Cost structure Project structure
1 Low Planned & remaining
Person months & Total costs(No split)
Project total(No split)
2 Medium Planned vs. ActualPerson months , Personnel costs, Subcontracting, Other costs
Split by WP (Work Package)
3 High Earned Value Management
Person months & Costs for each cost category in Form C
Split by WP and Task or Deliverable
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Monitoring at the beneficiary level
• Overall costs vs. budget• Is the remaining budget sufficient for completion of remaining tasks / deliverables?
• Actual vs. planned costs• Personnel
– Staff categories and costs according to plan?• Incurred cost categories that were not in the budget?– Ask the EU for approval before reporting?
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Monitoring at the consortium level
• Same questions as for the beneficiary levelPlus:
• Are there imbalances between beneficiaries?– Tight vs. generous budgets?– Budgets reflecting responsibilities (tasks / deliverables)?
• Any reasons to suggest budget reallocations?
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Financial monitoring example – FP7
WP1 WP2 WP3 … WPnTotal
incurred costs
Budget /Plan
Remaining budget
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 60,0% 60,0% 60,0% 60,0% 60,0% ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 100,0% 75,0% 75,0% 75,0% 50,0% ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
TotalReimbursement rate (%)Maximum EC contributionRequested EC contributio
EquipmentOther costs
Total other direct costsIndirect costs rate (%)Indirect costsLump sum/flat rate/scale
Work package
Person MonthsPersonnel costsSubcontracting
TravelConsumables
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Financial monitoring example – H2020
Person months
(A) Direct Personnel costs
(B) Direct costs of sub‐contracting
(D) Other direct costs
(E) Indirect costs Total Costs Receipts
Maximum EU Contribution
Total budget (Grant)
Remaining budget (Grant)
WP1 ‐ ‐ ‐ ‐ WP2 ‐ ‐ ‐ ‐ WP3 ‐ ‐ ‐ ‐ WP4 ‐ ‐ ‐ ‐ WP5 ‐ ‐ ‐ ‐ WP6 ‐ ‐ ‐ ‐ WP7 ‐ ‐ ‐ ‐ WP8 ‐ ‐ ‐ ‐ WP9 ‐ ‐ ‐ ‐ WP10 ‐ ‐ ‐ ‐ Total ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Financial monitoring example 2 – H2020
Person months
(A) Direct Personnel costs
(B) Direct costs of sub‐contracting
[C] Direct costs of financial support to third parties Travel Equipment
Consum‐ables
Costs of large
research infastructure
(D) Other direct costs
(E) Indirect costs
(F) Costs of.. Total Costs Receipts
Reimbursement rate
Maximum EU Contribution
Requested EU Contribution
Total budget (Grant)
Remaining budget (Grant)
Partner1 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner2 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner3 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner4 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner5 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner6 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner7 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner8 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner9 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Partner10 ‐ ‐ ‐ 100 % ‐ ‐ ‐ Total ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Progress report
• For deadlines that have passed:– Have tasks and deliverables been completed on schedule?
• For remaining tasks and deliverables:– Percent complete?– Expected delays?
• Time remaining vs. remaining tasks and deliverables
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Progress & Cost follow‐up
ResearchFinance
Resources
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Progress & Cost follow‐up
• Remaining budget vs. remaining time• Remaining budget vs. remaining tasks/deliverables
• Cost deviation vs progress deviation:– Planned vs. actual costs
– vs.
– Planned vs. actual progress/completion
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Progress – Planned vs. Actual effort
WP No. Task No. Task Name
Planned Actual Diff./ Remain
WP1 - - - Task 1.1 - Task 1.2 - Task 1.3 - Task 1.4 -
Partner 1
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Progress – Planned vs. Actual effortWP No. Task No. Task Name
Planned Actual Diff./ Remain Planned Actual Diff./
Remain Planned Actual Diff./ Remain Planned Actual Diff./
Remain Planned Actual Diff./ Remain Planned Actual Diff./
Remain WP1 - - - - - - - - - - - - - - - - - -
Task 1.1 - - - - - - - - Task 1.2 - - - - - - - - Task 1.3 - - - - - - - - Task 1.4 - - - - - - - -
WP2 - - - - - - - - - - - - - - - - - - Task 2.1 - - - - - - - - Task 2.2 - - - - - - - - Task 2.3 - - - - - - - - Task 2.4 - - - - - - - -
WP3 - - - - - - - - - - - - - - - - - - Task 3.1 - - - - - - - - Task 3.2 - - - - - - - - Task 3.3 - - - - - - - - Task 3.4 - - - - - - - -
WP4 - - - - - - - - - - - - - - - - - - Task 4.1 - - - - - - - - Task 4.2 - - - - - - - - Task 4.3 - - - - - - - - Task 4.4 - - - - - - - -
WP5 - - - - - - - - - - - - - - - - - - Task 5.1 - - - - - - - - Task 5.2 - - - - - - - - Task 5.3 - - - - - - - - Task 5.4 - - - - - - - -
Totals - - - - - - - - - - - - - - - - - -
Consortium totalsPartner 1 Partner 2 Partner 3 Partner 4 Partner 5
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Finance & Progress: Remaining budget vs. remaining work – FP7
WP1 WP2 WP3 … WPnTotal incurred
costsBudget /Plan
Remaining budget
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 60,0% 60,0% 60,0% 60,0% 60,0% ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐
‐ ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 100,0% 75,0% 75,0% 75,0% 50,0% ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
‐ ‐
‐ ‐ ‐ ‐ ‐ ‐ ‐
Total
Maximum EC contributionRequested EC contribution
ConsumablesEquipmentOther costs
Total other direct costs
Indirect costsLump sum/flat rate/scale of unit declared
Indirect costs rate (%)
Reimbursement rate (%)
Work package
Person MonthsPersonnel costsSubcontracting
Travel
BudgetRemaining budget (€)
% complete (tasks/deliverables)Remaining budget vs. remaining work
Remaining budget (%)
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Finance & Progress: Remaining budget vs. remaining work – H2020
Person months
(A) Direct Personnel costs
(B) Direct costs of sub‐contracting
(D) Other direct costs
(E) Indirect costs Total Costs Receipts
Maximum EU Contribution
Total budget (Grant)
Remaining budget (Grant)
Remaining budget (%)
% complete (tasks/deliverables)
Remaining budget vs. remaining work
WP1 ‐ ‐ ‐ ‐ ‐ ‐ WP2 ‐ ‐ ‐ ‐ ‐ ‐ WP3 ‐ ‐ ‐ ‐ ‐ ‐ WP4 ‐ ‐ ‐ ‐ ‐ ‐ WP5 ‐ ‐ ‐ ‐ ‐ ‐ WP6 ‐ ‐ ‐ ‐ ‐ ‐ WP7 ‐ ‐ ‐ ‐ ‐ ‐ WP8 ‐ ‐ ‐ ‐ ‐ ‐ WP9 ‐ ‐ ‐ ‐ ‐ ‐ WP10 ‐ ‐ ‐ ‐ ‐ ‐ Total ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Finance & Progress: Remaining budget vs. remaining work – H2020
Person months
(A) Direct Personnel costs
(B) Direct costs of sub‐contracting
[C] Direct costs of financial support to third parties Travel Equipment
Consum‐ables
Costs of large
research infastructure
(D) Other direct costs
(E) Indirect costs
(F) Costs of.. Total Costs Receipts
Reimbursement rate
Maximum EU Contribution
Requested EU Contribution
Total budget (Grant)
Remaining budget (Grant)
Remaining budget (%)
% complete (tasks/deliverables)
Remaining budget vs. remaining work
Partner1 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner2 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner3 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner4 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner5 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner6 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner7 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner8 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner9 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Partner10 ‐ ‐ ‐ 100 % ‐ ‐ ‐ ‐ ‐ Total ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Beyond cost & progress: Earned Value Management
Source: NASA Earned Value Management, https://evm.nasa.gov/
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Budget reallocations
• Budget revisions/changes• Reallocations
– Individual beneficiary– Between beneficiaries
• Adding/replacing beneficiaries
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Reallocations by a beneficiary
• With or without prior EU approval?• Changes that require no prior approval• Changes were prior approval is recommended, but not required
• Changes were prior approval is required
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Reallocations between beneficiaries
• Basis: Same rules as for each beneficiaryPlus:
• Budgetary implications of reallocation of tasks• Rectifying any budget imbalances between
beneficiaries• Consortium procedures
– Check the Consortium Agreement– Negotiations between involved parties before formal decision
– Normally: General Assembly decision
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Adding/replacing beneficiaries
• Identify the tasks and deliverables that are going to be reallocated
• Determine what resources are required for these tasks• Verify cost rates for new beneficiaries• Recalculate budget based on cost rates for the
beneficiaries that take over tasks• Calculate budget amount that is "freed up" by leaving
beneficiaries – Establish what costs that have been accepted by the EU
• Determine whether revised budget is within max EU grant
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Project finish
• Budget reallocations in the closing stages of the project
• Scenario:– One or more beneficiaries have spent less than their budget
– One or more beneficiaries have spent more than their budget, and this appears to be justified
• Follow consortium procedures for reallocation before submission deadline for final report
TN1302: BESTPRAC
BESTPRAC Training School: "Finance for beginners". Belgrade, Serbia 4 - 6 June, 2018
Any questions?
Thank you very much for your attention!