The document outlines an agenda for a day 4 training on FP7 finance and funding schemes. The agenda includes sessions on funding schemes and participation, budgeting exercises, recording project costs, certification requirements, and European Commission audits. Key topics covered are reimbursement rates, eligible costs, indirect costs calculation methods, and risk avoidance mechanisms for FP7 projects.

1. Irene Larroy, 9- 14th May 2010
www.lavic.cat

2. DAY 4
FP7 finance
and funding schemes
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

3. Day 4 – FP7 Finance and funding schemes
9.00-10.30 Session 1:
 Funding schemes, FP7 participation, subcontractors, third parties
 Risk sharing finance facility, guarantee mechanism
 From AC to full costs. Funding regimes, lump sums, flat rates. Funding rate
per activities
10.30-11.00 Coffee-break
11.00-12.00 Session 2:
 Personnel costs, average personnel costs, employment issues
 Eligible & ineligible costs
 Overhead, possible methods
12.00-13.00 Lunch
13.00-14.30 Session 3:
 Exercise 9 “Building the budget of a project”
 Financial planning, financial spreadsheet
 Bookkeeping, accounting records, timesheets, cost recording
 Certificate on financial statement
 EU audits, liquidated damages
14.30-15.00 Coffee-break
15.00-16.00 Session 4:
 Exercise 10 “Recording the costs of the project”
16.00-17.00 Optional time for individual questions with trainer
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

4. Important definitions
Public body:
• any legal entity established as such by national law, and
international organisations.
Research organisation
• a legal entity established as a non-for-profit organisation which
carries out research or technological development as one of its
main objectives.
Higher and secondary education establishments
• Includes universities, schools for applied sciences and similar.
SMEs
• Micro, small and medium-sized enterprises within the meaning of
Recommendation 2003/361/EC in the version of 6 May 2003 (OJ
L 124, 20.5.2003, p. 36).
International cooperation partner countries:
• FP6 INCO countries – three categories according to income per
capita (low-income, lower-middle-income, or upper-middle-
income); will be identified as such in the work programmes.
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

5. FP7 Terminology
• “Contract” becomes “Grant Agreement”
• “Contractor” becomes “Beneficiary”
• “Instruments” become “Funding Schemes”
• “Audit certificate” becomes “Certificate on Financial
Statement”
• The results of the project (knowledge in FP6)
becomes “Foreground”
• Pre-existing know-how becomes “Background”
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

6. Conditions for participation
• Minimum condition, general rule, at least 3 independent
participants from 3 different Member States (MS) or Associated
Countries (AC).
• Additional conditions can be established by the Work
Programme (number or type of participant, place of establishment)
• Specific conditions may also apply for:
– Frontier research actions (IDEAS), at least 1 legal entity
established in a MS or Ac
– INCO-CAPACIPIES: Collaborative projects addressing the
participation of International Cooperation Partner Countries
(ICPC) minimum is 4 participants, 2 of which from MS or AC
and another 2 from ICPC countries unless otherwise
foreseen in the WP
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

7. Upper funding limits (1)
• Reimbursed will be according to the type of activity!
• Research and technological development activities: up to
50% of eligible costs for Large enterprises, or up to 75% for:
• Non profit public bodies
• secondary and higher education establishments
• research organisations
• SMEs
• Security related research, for highly reliable capabilities with impact
on security of European citizens and targeted to a limited number of
public users
• Demonstration activities: up to 50%
• Other activities including management: up to 100%
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

8. Upper funding limits (2)
Actions that will be reimbursed up to 100%:
• Frontier research (IDEAS)
• Coordination and support actions (in all blocks)
• Training and career development of researchers
(PEOPLE)
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

9. Maximum
reimbursement Research and Demonstration Management Other
rates of technological activities of the activities
eligible costs development (*) consortium (**)
activities
Network of 50% 100% 100%
excellence 75% (***)
Collaborative 50% 50% 100% 100%
project 75% (***)
Coordination 100% (****) 100% (****)
and support
action
(*) Research and technological development includes operational activities directly related to the protection of foreground and
coordination of research activities.
(**) Other activities means any "specific activity" covered by Annex I.
(***) For beneficiaries that are non profit public bodies, secondary and higher education establishments, research organisations and
SMEs
(****) The reimbursement of indi rect eligible costs, in the case of coordination and support actions, may reach a maximum 7% of the
direct eligible costs, excluding the direct eligible costs for subcontracting and the costs of reimbursement of resources made
available by third parties wh ich are not used on the premises of the beneficiary.
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

10. Exercise 9: building the budget of a project
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

11. Most funding schemes use reimbursement of eligible costs
Eligible costs: they must be:
• actual (average personnel costs may be used if do not
differ significantly from actual)
• incurred during duration of project
• in accordance with the beneficiary usual accounting and
management principles
• recorded in the accounts of beneficiary
• used for the sole purpose of achieving the objectives of
the project
Non-eligible costs (identifiable indirect taxes including VAT…)
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

12. Indirect Costs
• Participants may charge eligible direct and indirect costs
• Reimbursement of indirect costs:
– For all:
• either actual overhead
• flat rate of 20% of direct costs
– For Non profit Public Bodies, Secondary and Higher Education
establishments, Research Organisations, and SMEs unable to
identify real indirect costs, may apply for a flat rate of 60% for funding
schemes with Research, Technological Development & Demonstration
– For Coordination and Support Actions limit of 7% of direct costs for
all participants
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

13. Simplified method
• A participant may use a simplified method to calculate its
indirect costs if this is in accordance with its usual
management and accounting principles
• Why this new approach?
• The Council wished to introduce a way to facilitate the
transition from the Additional Cost model (abolished)
towards the declaration of actual indirect costs
• The EC added the 60% flat rate for indirect costs for
specific entities, being unable to identify their indirect
costs
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

14. Exercise 10: recording the costs of the project
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

15. Certification on financial statements
Under FP7 we do not talk anymore about audit certificates but
about certificate on financial statements (CFS)
Certificate on financial statements:
• Mandatory when requested funding reaches 375,000
Euro per beneficiary (except for project of 2 years or less:
CFS submitted at the end)
• If above the threshold, mandatory for every beneficiary,
except if a certification on the methodology is provided
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

16. European Commission audits
Independently of the certification on financial statements, the EC
may conduct at any time an audit.
These audits are very deep and time-consuming.
The EC normally conducts audits to those organisations which are
participating in several FP7 projects, or those that have been
detected as suspicious for any reason. Random audits also take
place, especially to the coordinators of big projects.
The auditors will ask for proven record of all the costs that the
organisation has claimed.
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

17. Risk avoidance mechanism
Participant Guarantee Fund (“the Fund”):
• All beneficiaires contribute to the Fund to insure against
losses of a defaulting participant
• The contribution shall not exceed 5% of the EC financial
contribution due to each participant
• Financial interests generated by the Fund will serve to cover
financial risk
• In principle this amount will be reimbursed at the end of the
action
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat

18. CONTACT
Irene Larroy
LAVIC Technologies
C/Montserrat 8, D
08172 Sant Cugat del Vallès
Barcelona
t. +34 93 5895936
f. +34 93 6742159
irene.larroy@lavic.cat
Jornada ACTec: Introducció a–la redacció de Amman 9-14de projectes d'R+D+i
FP7 Training STRD Project – memòries May 2010 www.lavic.cat