Hercule III Programme

Guide for Applicants

Version 2.0
12 February 2020
IMPORTANT NOTICE

The Guide for Applicants aims to explain to applicants and beneficiaries the
main rules that apply to the evaluation of their proposals and management of their
EU grants.
It covers action grants awarded under the Hercule III Programme.
It is designed to be your main practical reference for preparing and submitting
your proposal and — if successful — for managing your grant.

As far as possible, please try to find yourself the answers you need (we have
limited resources for handling direct enquiries).
All terms are explained in the Glossary.
Details on processes and procedures are described in the Online Manual. The
Online Manual also contains FAQs and detailed instructions for the Electronic
Exchange System .
A complete list of reference documents (including legislation, work programme and
templates) can be found on the Participant Portal Reference Documents page.

HISTORY OF CHANGES
PUBLICATION
VERSION CHANGE
DATE

1.0 22.02.2019 Initial version.

Updated hyperlinks + correction typos
2.0 12.02.2020
UK/Brexit disclaimer
EU Grants: Guidance — Guide for Applicants (action grants): V2.0 – 12.02.2020

TABLE OF CONTENTS

1. Legal framework .................................................................................................... 4

2. Projects that will be funded — Eligibility criteria — Admissibility criteria —

Exclusion criteria — Selection criteria — Award criteria ..................................... 4

3. Participants: Roles & responsibilities ..................................................................... 4

4. Type of grant ......................................................................................................... 4

5. How to submit your proposal ................................................................................. 5

5.1 Preparing your submission .............................................................................6

5.2 How to fill out your application........................................................................7

5.3 Help .......................................................................................................... 12

5.4 Submission — Acknowledgement of receipt — Complaints ................................ 13

6. Information on the evaluation results ................................................................. 13

7. Preparing your grant agreement & final legal checks .......................................... 13

8. Managing your grant............................................................................................ 13

APPENDIX 1 — ELIGIBLE COSTS ............................................................................ 15

APPENDIX 2 — LIST OF RECORDS & SUPPORTING DOCUMENTS PER COST

CATEGORY ..................................................................................... 47

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1. Legal framework

If you are in any doubt about any issues mentioned in this guide, the legally binding
rules and conditions for the calls are in the following documents:
 Regulation (EU, Euratom) 2018/1046 (EU Financial Regulation) of 18 July 2018;
 the basic act (Regulation (EU) No 250/2014) of 26 February 2014;
 the annual work programme;
 the call document;
 the model grant agreements (MGAs).

2. Projects that will be funded — Eligibility criteria — Admissibility

criteria — Exclusion criteria — Selection criteria — Award criteria

The types of projects and activities that will be funded are set out in the EU work
programme and call document.

Eligibility, admissibility, exclusion, selection and award criteria are explained in the
call document.

3. Participants: Roles & responsibilities

Applicants are responsible for their proposal and for submitting correct information
in the proposal. After grant signature, they become responsible for implementing
the project activities (in accordance with part B of the proposal which becomes an
annex to the grant agreement if the project is selected for funding). If a project is not
finished, the grant may have to be reduced.

Your project may involve subcontractors to help with the project activities.

If you use third parties, they and their contribution must be mentioned (and justified) in
Part B of your application.

Core tasks of the project may NOT be subcontracted (generally, tasks representing more
than 40% of the total eligible costs will be considered core tasks, unless specified otherwise
in the call document; above this limit, it will be accepted only in exceptional cases and with
specific justification).

4. Type of grant

The grant is a reimbursement of eligible costs grant.

This means that it reimburses ONLY the costs you actually incur for your project (NOT
the budgeted costs). The costs will be reimbursed at the reimbursement rate and
up to the maximum grant amount fixed in the grant agreement.

The grant will be paid out in one or more parts:

 pre-financing payment(s) (if foreseen in the grant agreement) — designed to
provide beneficiaries with a float; normally paid at the beginning of the
project;
payment of the balance — reimburses the outstanding part of the costs incurred for
the project implementation; calculated as the difference of total amount due and
payments already made; paid on receipt and approval of the final reports.

If the total amount of earlier payments is greater than the final grant amount,
we will have to recover the difference (i.e. you will have to pay back money).

.
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5. How to submit your proposal

All proposals must be submitted directly online via the Funding & Tenders Portal
Submission System system. Paper applications are no longer accepted.

The submission process is explained in the Funding & Tenders Portal Online Manual
(together with detailed instructions for the IT tool).

Submission is a 2-step process:

a) register your organisation;
b) submit the proposal — in 3 parts, as follows:
 Part A of the application form includes administrative information about the
applicant organisation and the summarised budget for the proposal.
Fill in directly online.
 Part B of the application form (description of the action) covers the
technical content of the proposal.
Fill in the word template and upload as PDF file.
 Annexes (the scanned version of the detailed budget and any other annex
as required in the call document)).
Upload as PDF files.
You are also requested to send the Word (.docx) version of your application
documents (Part A and Part B), as well as the Excel version (.xlsx, not
locked) of the Annex 2 – Budget form, with the acronym and the reference
number of your application, to the relevant mailbox:
- [email protected] for the "Technical Assistance" call;
- [email protected] for the "Training, Conference and
Staff Exchange" call;
- [email protected] for the "Legal Training and
Studies".

The proposal must be submitted before the call deadline (specified in the call
document). If you miss the deadline, your proposal will be automatically disregarded
by the system and considered as not submitted.
Documents must be uploaded to the right category (otherwise your proposal might
be incomplete and therefore inadmissible).
You can submit your proposal in any official EU language. However, for reasons of
efficiency, we strongly advise you to use English. If you need the call document in
another official EU language, please be aware that, depending on the language
requested, it could take between 1 to 3 weeks to obtain a translation of the call
documents. The deadline for submission will not be extended. Please submit a request
within 10 days after call publication.

We strongly advise you to complete your proposal sufficiently in advance of the

deadline, to avoid any last minute problems. Any technical problems due to last minute
submissions (e.g. congestion, etc.) will be at your risk. The call deadline will NOT be
extended.

Even though you can save successive versions of your application as you go, we
strongly encourage you to have fully prepared your proposal before starting the online
submission process (sample text can be downloaded from the Funding & Tenders Portal
Reference Documents page).

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To complete part A, all applicants must be registered in the Participant Register and
have communicated their PIC (Participant Identification Code) to the coordinator.
Subcontractors do NOT need to register.

You may submit several proposals (and an organisation may participate in several
applications), however those proposals must be for different projects.
If you have made several applications for the same project, you will be asked to clarify
which application you would like us to evaluate (projects may normally receive only one
grant from the EU budget).

If you submit Part B of the proposal in a language other than English, please write
your abstract/project summary (both in Part A and in Part B) in English.

5.1 Preparing your submission

You must do 3 things before submitting your application:

 read the key background documents: work programme and call documents;
 create an EULogin user account (if you don't already have one; former ECAS
account);
 register your organisation in the Participant Register.

Read the background documents

Check whether:
 your project falls within the scope of the call;
 your organisation/proposal meets the eligibility criteria;
and inform yourself about the:
 award criteria;
 financial and operational capacity requirements;
 exclusion criteria;
 admissibility conditions (e.g. call deadline, page-limits, etc.);
 other (e.g. pre-financing guarantees).

For UK applicants: Please be aware that following the entry into force of the EU-UK
Withdrawal Agreement1on 1 February 2020 and in particular Articles 127(6), 137 and
138, the references to natural or legal persons residing or established in a Member
State of the European Union are to be understood as including natural or legal
persons residing or established in the United Kingdom. UK residents and entities are
therefore eligible to participate under this call.

Create a user account

To use the Funding & Tenders Portal Electronic Submission System (the only way to
apply), all participants need to create an EULogin user account.

1
Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the
European Union and the European Atomic Energy Community.

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Register your organisation in the Participant Register

Once you have an EULogin account, you can register your organisation in the
Participant Register.

When your registration is finalised, you will receive a 9-digit Participant Identification
Code (PIC). You will need the PIC number of your organisation to complete Part A of
the application. PICs of linked third parties are not needed at this stage (they will
have to register later on).

The person who registered the organisation can submit updates and corrections
(including supporting documents) at any point before the call deadline (afterwards
this can be done only by the legal entity appointed representative (LEAR)).

You don't need to complete the registration process in a single session. You can enter
some information, save it and continue later.
.

5.2 How to fill out your application

To give your proposal the best chance of being selected for funding, make sure it is:
 relevant — address the relevant priorities in the topic.
 complete — include all the relevant information. Follow closely the format of
the template in part B and ensure you upload all the information requested.
 clear & concise — don't interpret completeness as a requirement to include as
much information (and words) as possible. Your proposal must also be easy to
understand, precise and focused on substance.
Respect the page limit. Do not repeat information.
 management-focused — clearly indicate the resources you will allocate to
managing the intended activities, especially financial management (ensuring
the funding you are requesting will be adequate to finance the planned
activities).
 results/impact-oriented — clearly show the results that will be achieved, and
how you intend to disseminate/use them. Include a sound and credible
evaluation plan, not only focusing on process evaluation, but also looking at
outcomes.

Part A — Administrative forms

Part A of the proposal must be filled out directly online.

Contact details

Please make sure the e-mail address you give is correct and working during the whole
time of the procedure — we may have to contact you for more information, when
evaluating your proposal.

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Budget overview table

The budget overview table should show the total estimated expenditure and receipts
of the applicant, per budget category.

Column Budget category

A Direct personnel costs

Indicate costs for personnel. Include only persons working on the action (and
only for their estimated time of work on the action).

B.1, B.2 Direct costs of travel & subsistence

Indicate costs for travels and subsistence.

C Direct costs of subcontracting

Indicate costs for subcontracted action tasks.

D Costs of financial support to third parties - Not applicable.

E Other direct costs

Include costs for equipment, consumables, conferences, publications and
other goods and services, provided they are not for subcontracted action
tasks.

F Indirect costs
Automatically calculated (at the indirect cost flat-rate set out in the call
document).

G Total costs
Automatically calculated.

Reimbursement rate
H
Pre-filled (at the reimbursement rate set out in the call document).

Maximum EU contribution
I
Automatically calculated.

Reguested grant amount

J
Indicate the amount of EU funding you would like to have for the project (it
cannot be higher than the maximum EU contribution).

Action's estimated receipts

K, L
Indicate project-generated income (K) and financial contributions from third
parties that are specifically to be used to cover eligible costs (L).

Only the white cells of the budget table in the Submission System need to be filled in
(the grey cells are not applicable or automatically filled by the system).

The budgeted costs should be based on a detailed and accurate estimation of your
estimated project costs (based on the cost eligibility rules set out in Article 6 of the
grant agreement and Appendix 1 to this guide).

They should include all your estimated costs.

You may include only eligible costs (i.e. costs that fulfil the eligibility conditions).

Keep your estimates on file — you may be required to produce them later on.

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Part B — Description of the action (DoA)

1. Project abstract, context & needs analysis, aim & objectives, methodology

These sections should contain a pitch for the project, its context, aims and objectives
and methodology.

Make sure that the information given in part A of the application form is consistent
with the information provided in part B.

Please explain abbreviations and acronyms used.

Section 1: Project summary

This section must contain the same information as indicated in Part A of the
application form.

2. Context and needs analysis

Which of the categories below does your action belong to? - each box corresponds to
one of the specific objectives listed in Article 8(b) of Regulation (EU) No 250/2014.
You may tick several boxes.

Place and time of the proposed events - make a list of the events that will take place
in the course of the action. Internal preparation meetings are not considered as
events. For each event, indicate the duration in days, the venue, the provisional dates
and the provisional number of participants. Create a specific provisional agenda for
each event and fill it in annex I of the application form part B.

Estimated total number of participants to all the event(s) - indicate the estimated
total number of participants for the event(s) and the target group.

Context and needs analysis - describe why you would like to undertake this project.
Justify the timing and explain why it would be the right moment to implement it.

3. Objectives, impact and methodology

Objectives – define the project's specific objectives (they should be clear, measurable
and realistic) as well as appropriate indicators for measuring their achievement.

Relevance – explain how the project conttributes to the general, specific and
operational objectives of the Programme.

Impact – define the short, medium and long-term effects.

Concept and methodology – Explain the project's methodology and shortly describe
how you will proceed in order to:

• ensure a smooth implementation of the action within the timetable as indicated in

the call document;

• ensure the participation of the expected speakers, trainers and participants;

• take action in the event of a contingency;

• if relevant, justify the sequence of the main events;

• specify the key steps of the action in a timeline from its preparation to its
evaluation.

Cost effectiveness – demonstrate that the proposed budget is sufficient and

appropriate for a proper implementation of the project.

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European added value – illustrate the EU dimension of the planned activities: trans-
national dimension, possibility to use the results in other Member States, etc.

6.1 Applicant information - please tick the box that you consider the most appropriate
for your organisation.

Description - give a description of the activities undertaken by your organisation that

are most relevant in relation to this call. You must demonstrate that your organisation
contributes to the protection of the financial interests of the Union and the fight
against fraud, corruption and any other irregularities perpetrated against the financial
interests of the Union.

Confirmation - tick the box you consider most relevant. If you tick the "No" box, your
application will not be considered eligible. If you tick the "Yes" box, this can only be
done on the basis of the justification given under question III.2.

Research and educational institutes and non-profit-making entities must confirm that
they have been established and have been operating for at least one year in
accordance with Article 6(b) of Regulation No 250/2014.

If you are not in a position to tick the option "Yes, I confirm", your application is
considered not eligible and will not be further examined.

6.2. Project management

Project management – explain the overall management concept. Present the

structure of the organisation, departments, number of permanent employees, etc.
Indicate the role and responsibilities of the project team and its place in the
organisation. You also have to indicate whether the team will be set up for the
implementation of the action only, or whether it has a fixed place in your
organisation.

Staff involved - indicate the roles, functions and tasks of the staff members
responsible for implementing the action. Give a description of the skills and abilities of
each team member relevant to the implementation of the action. It shall include the
name (if already known), language proficiency, education degree, training and current
function description. It is not necessary to include CVs of the team members, but it is
important to demonstrate that the team members have the appropriate qualifications
that are relevant for the tasks the staff member will carry out to ensure that the
action is smoothly and timely implemented.

In addition, please indicate whether the team will be set up for the implementation of
the action only or whether it has a fixed place in your organisation.

Monitoring and evaluation strategy - indicate how you will monitor and measure the
impact of the project.

For conferences, seminars and trainings, explain how the participants' satisfaction will
be ensured, in particular with regard to:

• the overall organisation of the event;

• the acquired competences and skills (in particular for training events);
• the networking opportunities;
• their perception of the mid-term impact of the event.

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For the "Legal Training and Studies" and "Training, Conferences and Staff Exchange"
calls, if awarded a grant, you will receive a template for a user survey to be filled-in
by the participants to the event(s). In addition, you will be asked to carry out a
survey among the participants six months after the event took place ("post-event
survey").

6.3 Dissemination and communication activities - please explain how the results of
the action will be disseminated on the basis of the following points:

 the type of activities;

 the purpose of the dissemination;
 the format (hard copy, electronic copy, publication on internet), and justify why
you prefer hard copies, since this is generally more expensive than electronic ones;
 the specific audience(s) to which the documents will be disseminated;
 Commission's right to publish an electronic version of the deliverables on the
Commission's website;
 the planning (timetable) of the dissemination;
 the language(s) of the documents.

7. Declarations and signature - Part B of the application form must be signed by a

person that is the legal representative of the organisation, duly authorised to
represent the applicant for the action for which this application is submitted.

Once filled in and signed, Part B must be scanned and uploaded onto the
Funding & Tenders Portal.

Annexes & supporting documents

Use the forms provided inside the Submission System (not the documents available on
the Reference Documents or Call Topic page — they are only for information).
Please be aware that if your proposal is successful, you will be asked to submit further
documents later on (e.g. financial documents, legal entity validation documents, LEAR
appointment documents, etc).

Annexes to application form part B - "Legal Training and Studies" and

"Training, Conference and Staff Exchange" calls for proposals:

1) Draft agenda/outline (if applicable)

For the conferences, please indicate a proposed agenda, including topics to be

addressed and indication of the time slots for each topic/speaker. If already known,
the names of proposed speakers and their function should also be provided. The
agenda should leave enough time for:

• questions/answers and exchange of information between the participants;

• lunch and/or coffee breaks.
For proposed comparative law studies, please insert a provisional outline indicating
the proposed topic, geographical scope, structure/chapters and methodology to be
used.

For proposed periodical publication, please mention the publication frequency, profile
of the editorial committee members (area of activity, professional qualifications,
country, organisation), provisional contents of the first publication, and other
information deemed relevant.

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2) Detailed budget table

The detailed budget table (annex to Part B) should show the detailed budget
breakdown of the estimated costs in the Part A budget overview table. You can
download a detailed budget template from the Call Topic page.

It will be taken into account for the evaluation (cost efficiency).

The itemised expenditure should match the project activities described in Part B and
linked to the work packages for which they will be used.

Annexes to application form part B – "Technical Assistance" call for

proposals:

1) Quotes from the suppliers for the purchase of specialised equipment

and services

2) Detailed budget table

The detailed budget table must be in line with the amounts entered into the Part A
budget overview table.
You should budget ONLY eligible costs (see the grant agreement and the Appendix
1 to this guide).
Keep your estimates on file (you may be required to produce them later on).

5.3 Help

In principle, you should find the answers to your questions in:

- Online Manual

- FAQs on the Call Topic page

You are strongly advised to consult the Call Topic page regularly, since we may
publish new information (e.g. call updates, FAQs).

Please be aware that we have limited resources for handling direct requires.

Nevertheless, should you not find an answer to your question after consulting the
available Manual and FAQs, you can contact us as follows:

 IT helpdesk — for technical questions about the Funding & Tenders Portal
Submission System (forgotten passwords, access rights and roles, technical
aspects of proposal submission, etc.).

 Non-IT questions — use the relevant mailbox:

 [email protected] for the "Technical Assistance" call;

 [email protected] for the "Training, Conference and

Staff Exchange" call;

 [email protected] for the "Legal Training and Studies"

call.

Questions on submission must be:

 sent at the latest 7 days before the submission deadline;
 indicating clearly the reference of the call you are interested in or applying to
(see call document cover page).

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5.4 Submission — Acknowledgement of receipt — Complaints

Once the proposal is submitted, you will receive a confirmation e-mail (with date and
time of your application).

If you do not receive this email, it means your proposal has NOT been submitted.
If you believe this is due to a fault in the Electronic Submission System, you should
immediately file a complaint via the Funding & Tenders Portal, explaining the circumstances
and attaching a copy of the proposal (and, if possible, screenshots to show what happened).

6. Information on the evaluation results

After submission, you will normally not hear from us until after evaluation — unless
we need to clarify matters such as eligibility or request additional information.

We will check eligibility and admissibility and evaluate your proposal against the
award criteria set out in the call document.

Proposals that do not pass the evaluation will receive a letter at the end of evaluation.

To ensure equal treatment for all applicants, we can NOT answer any questions on the
outcome of the call before the evaluation is completed.

7. Preparing your grant agreement & final legal checks

Successful proposals will be invited to prepare the grant agreement directly online in
the Funding & Tenders Portal (so-called ‘grant preparation’).

At the same time, you will be requested to submit your financial data and appoint
your LEAR and we will finalise the mandatory legal checks (legal entity validation,
operational and financial capacity, exclusion and double funding).

If all requirements are fulfilled, you will receive an invitation to sign your grant
agreement (signature first by the beneficiary and then by the EU).

Our model grant agreement clauses cannot be altered and are the same for all
beneficiaries.

8. Managing your grant

Your grant will be managed exclusively via the the Funding & Tenders Portal Grant
Management System. Paper or e-mail communications are no longer accepted.

The system will prompt any action on your side via PNS e-mail notifications.

For a successful proposal implementation, we mainly require the following:

 implement the project as described in the description of the action (DoA)
and
 report regularly by filling out the information in the:
o Funding & Tenders Portal Continuous Reporting Module — always open
(for submission of deliverables and reporting on milestones, critical
risks, summary for publication etc.)

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o Funding & Tenders Portal Periodic Reporting Module — open only at the
end of the reporting period(s) (for periodic and final reports)

Proper project implementation will allow us to process your reports quickly and make
the payments provided for in the grant agreement.

You will be prompted to submit a financial statement to request payment of the

costs incurred during the reporting period.
You should declare ONLY the eligible costs actually incurred for the project
implementation (NOT the budgeted costs or other ineligible costs; see the grant
agreement and the Appendix 1 to this guide).
Budget transfers are subject to ceilings/limits (see the grant agreement). Beyond
those ceilings/limits, you will have to request a formal amendment.
Keep your calculations on file (you may be required to produce them later on and
during an audit you will have to show how each cost item you declared can be
reconciled with your accounts).

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APPENDIX 1 — ELIGIBLE COSTS

GENERAL CONDITIONS

ARTICLE 6 — ELIGIBLE AND INELIGIBLE COSTS

6.1 General conditions for costs to be eligible

‘Eligible costs’ are costs that meet the following criteria:

(a) for actual costs:

(i) they must be actually incurred by the beneficiary;

(ii) they must be incurred in the period set out in Article 3, with the exception of costs relating to
the submission of the final report (see Article 15);

(iii) they must be indicated in the estimated budget set out in Annex 2;

(iv) they must be incurred in connection with the action as described in Annex 1 and necessary
for its implementation;

(v) they must be identifiable and verifiable, in particular recorded in the beneficiary’s accounts in
accordance with the accounting standards applicable in the country where the beneficiary is
established and with the beneficiary’s usual cost accounting practices;

(vi) they must comply with the applicable national law on taxes, labour and social security, and

(vii) they must be reasonable, justified and must comply with the principle of sound financial
management, in particular regarding economy and efficiency;

(b) for unit costs: [OPTION 1: not applicable;]

1. Eligible costs

The grant can only reimburse eligible costs (i.e. costs that comply with the general
and specific conditions set out in this Article) (‘reimbursement of eligible costs
grant’).

ONLY eligible costs may be entered into the estimated budget for the action (see
Article 4) and declared in the financial statements (see Article 15).
Record-keeping & burden of proof — The burden of proof for eligibility is on the
beneficiaries. They must keep sufficient supporting documents (see Article 13) to
show that the costs they declare are eligible.
Compliance with eligibility rules may be subject to a check or audit by us. Any
ineligible costs found will be rejected (see Article 28).

If a beneficiary declares ineligible costs, the ineligible costs will be rejected

and, if needed, other measures specified in Chapter 6 (e.g. suspension,
termination, grant reduction, etc.) may be taken.

Article 6.1 refers to general eligibility conditions, applicable per cost form.

Article 6.2 refers to specific eligibility conditions, applicable per budget.

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2. General eligibility conditions for actual costs

In order to be eligible, actual costs must be:

 actually incurred by the beneficiary (i.e.:

o real and not estimated, budgeted or imputed and

o definitively and genuinely borne by the beneficiary (not by any other

entity).

 incurred during the action duration (i.e. the generating event that triggers
the costs must take place during the action duration)

The ‘action duration’ is the period running from the action starting date to
the end date of the action (see Article 3).

If costs are invoiced or paid later than the end date, they are eligible only if
the debt existed already during the action duration (supported by
documentary evidence) and the final cost was known at the moment of the
financial report.

Costs of services or equipment supplied to a beneficiary may be invoiced

and paid after the end date of the action if the services or equipment were
used by the beneficiary during the action duration. By contrast, costs of
services or equipment supplied after the end of the action (or after GA
termination) are not eligible.

Example: A conference for which costs are claimed must take place
during the action duration; a publication for which costs are claimed
must have been completed during the action.

Certain other costs incurred before or after the action duration may be
considered exceptionally eligible if the timing is imposed by us (i.e. a bank
guarantee to be provided before the action starting date (if any); kick-off
meeting organised before the action starting date).

 entered as eligible costs in the estimated budget of the action, under

the relevant budget category (see Annex 2)

When the final amount of the grant is calculated, the eligible costs cannot
include costs under budget categories that did not appear in the action
estimated budget, unless the initial estimated budget was amended or, for
subcontracts, if these additional costs were approved in accordance with Article
10.

Costs included in the estimated budget may be transferred between

beneficiaries and budget categories without amending the GA under the
conditions set out in Article 4.2.

Budget transfers between categories must stay below 20% of the total costs
for the action set out in Annex 2, unless they are approved by an amendment
(see Article 4.2).

 connected to the action as described in Annex 1 (i.e. necessary to

achieve the action’s objectives)

The EU grant cannot be used to finance activities other than those approved by
us.

Project management — Coordination and administration tasks are considered

action tasks.

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 identifiable and verifiable (i.e. come directly from the beneficiary’s accounts
(be directly reconcilable with them) and supported by documentation)

The beneficiaries must be able to show (with records and supporting

documents; see Article 18) the actual costs of the work, i.e. what was actually
paid for the work (and for depreciation costs: what is actually recorded in the
beneficiary’s profit and loss accounts).

Costs must be calculated according to the applicable accounting rules of the

country in which the beneficiary is established and according to the
beneficiary’s usual cost accounting practices.

This may NOT be used as an excuse for non-compliance with other GA

provisions. A beneficiary must make any changes needed to bring its usual
cost accounting practices in line with all GA provisions.

Examples: conditions for calculation of productive hours (see below);

conditions for the eligibility of depreciation costs (in line with the
international accounting standards, which may deviate from the
accounting rules of the country)

Where national taxation and accounting rules do not require an invoice, an

accounting document of equivalent value must be supplied (i.e. a
document that (i) is produced to prove that the accounting entry is
accurate and (ii) complies with the applicable accounting law).

 in compliance with applicable national laws on taxes, labour and social

security

AND

 reasonable, justified and must comply with the principles of sound

financial management, in particular regarding economy and efficiency
(i.e. be in line with good housekeeping practice when spending public money
and not be excessive)

‘Economy’ means minimising the costs of resources used for an activity

(input), while maximising quality; ‘efficiency’ is the relationship between
outputs and the resources used to produce them.

Examples:
1. The beneficiary may NOT increase the remuneration of its personnel,
upgrade its travel policy or its purchasing rules because of the EU grant.
2. Entertainment or luxurious expenses (including gifts, special meals and
gastronomic dinners) are generally not eligible.

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DIRECT & INDIRECT COSTS

ARTICLE 6 — ELIGIBLE AND INELIGIBLE COSTS

[…]

6.2 Specific conditions for costs to be eligible

Costs are eligible if they comply with the general conditions (see above) and the specific conditions set
out below for each of the following budget categories:

A. direct personnel costs;

B. direct travel and subsistence costs;
C. direct costs of subcontracting;
D. not applicable;
E. other direct costs;
F. indirect costs.

‘Direct costs’ are costs that are directly linked to the action implementation and can therefore be
attributed to it directly. They must not include any indirect costs (see Point F below).

‘Indirect costs’ are costs that are not directly linked to the action implementation and therefore
cannot be attributed directly to it.

[…]

1. Direct costs

‘Direct costs’ are specific costs directly linked to the performance of the action and
which can therefore be directly booked to it.

They are:

 either costs that have been caused in full by the activities of the action

 or costs that have been caused in full by the activities of several actions
(projects), the attribution of which to a single action can, and has been,
directly measured (i.e. not attributed indirectly via an allocation key, a cost
driver or a proxy).

The beneficiaries must be able to show (with records and supporting evidence) the
link to the action.

2. Indirect costs

‘Indirect costs’ are costs that cannot be identified as specific costs directly linked to
the performance of the action.

In practice, they are costs whose link to the action can NOT be (or has not been)
measured directly, but only by means of cost drivers or a proxy (i.e. parameters
that apportion the total indirect costs (overheads) among the different activities of
the beneficiary).

Indirect costs are automatically declared as a 7% fixed flat-rate of the eligible

PERSONNEL COSTS
direct costs (see Article 6.2.F).
For the "Technical Assistance" call, the indirect costs are not eligible (0% fixed flat-
rate).
.
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PERSONNEL COSTS

ARTICLE 6 — ELIGIBLE AND INELIGIBLE COSTS

[…]

A. Direct personnel costs

Types of eligible personnel costs

A.1 Personnel costs are eligible if they are related to personnel working for the beneficiary under an
employment contract (or equivalent appointing act) and assigned to the action (‘costs for
employees (or equivalent)’). They must be limited to salaries, social security contributions, taxes
and other costs included in the remuneration, if they arise from national law or the employment
contract (or equivalent appointing act).

They may also include additional remuneration for personnel assigned to the action (including
payments on the basis of supplementary contracts regardless of their nature), if:

(a) it is part of the beneficiary’s usual remuneration practices and is paid in a consistent manner
whenever the same kind of work or expertise is required;

(b) the criteria used to calculate the supplementary payments are objective and generally
applied by the beneficiary, regardless of the source of funding used.

A.2 The costs for natural persons working under a direct contract with the beneficiary other
than an employment contract or seconded by a third party against payment are eligible
personnel costs, if:

(a) the person works under conditions similar to those of an employee (in particular regarding
the way the work is organised, the tasks that are performed and the premises where they
are performed);

(b) the result of the work carried out belongs to the beneficiary (unless agreed otherwise), and

(c) the costs are not significantly different from those for personnel performing similar tasks
under an employment contract with the beneficiary.

Calculation

Personnel costs must be calculated by the beneficiaries as follows:

- for persons working exclusively on the action:

{monthly rate for the person

multiplied by

number of actual months worked on the action}

The months declared for these persons may not be declared for any other EU grant.

The ‘monthly rate’ is calculated as follows:

{annual personnel costs for the person divided by 12}

using the personnel costs for each full financial year covered by the reporting period
concerned. If a financial year is not closed at the end of the reporting period, the
beneficiaries must use the monthly rate of the last closed financial year available.

- for persons working part-time on the action:

{daily rate for the person

multiplied by

number of actual days worked on the action (rounded up or down to the nearest half-
day}

The number of actual days declared for a person must be identifiable and verifiable (see
Article 13).

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Therefore, the maximum number of hours that can be declared for the grant are:

{number of annual productive days for the year (see below)

minus

total number of hours declared by the beneficiary, for that person for that year, for
other EU grants}

The ‘daily rate’ is calculated as follows:

{actual annual personnel costs for the person

divided by

number of individual annual productive days}

using the personnel costs and the number of annual productive days for each full
financial year covered by the reporting period concerned. If a financial year is not
closed at the end of the reporting period, the beneficiaries must use the daily rate of
the last closed financial year available.

The ‘number of individual annual productive days is the total actual hours worked by
the person in the year. It may not include holidays and other absences (such as sick
leave, maternity leave, special leave, etc). However, it may include overtime and hours
spent in meetings, trainings and other similar activities.

The Commission may accept other calculation methods (such as, for instance, daily rates, daily rates
calculated with annual personnel costs and 215 fixed annual productive days or a pro-rata
apportionment of the monthly salary costs), if it considers that they reflect the actual costs incurred
in a fair, objective, realistic way and if there are sufficient records to support these costs (see Article
13).

1. Personnel costs (category A)

What costs?

This budget category covers personnel costs (employees or equivalent, natural

persons under direct contract and seconded persons).

The personnel costs should correspond to the adequate human resources needed to
ensure the successful implementation of the project.

The costs must be calculated on the basis of actual gross salary or wages plus
obligatory social charges and any other statutory costs included in the remuneration.

The costs you declare must correspond to the actual time worked on the project by
the staff concerned.

The rates at which staff are charged to the project must correspond to the normal
remuneration policy of each beneficiary (documented by salary grids, long-term work
contracts, etc.).
It should not significantly exceed the market rates generally applicable in the
geographical area and sector (especially with respect to the profile of the staff
concerned), and must be justified by the nature of the work.
Any amount paid in excess of these rates may be considered an ineligible cost.

Overtime — Overtime is included and reimbursed just like normal working time.
Overtime pay must be included in the annual personnel costs. Overtime worked (paid or
unpaid) must be added to the annual workable days to calculate the annual productive
days.

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How to calculate them?

Please use the detailed budget table available in the Funding & Tenders Portal Submission
System to build your grant budget. It follows the cost categories and eligibility rules of the grant
agreement.

Budgeting personnel costs

For the estimated budget, you should indicate for each participant the total amount of
staff costs they estimate to be necessary for the project.

These amounts should be a detailed and accurate estimate of individual staff costs
(estimated person-months per staff category), following the calculation method
described below. Only eligible costs should be budgeted.

The cost details should contain:

 number of persons per staff category (names are optional)
 function in the project
 working status, e.g.
 recruited specifically for the project or permanent employee?
 under a contract other than an employment contract?
 part-time or full-time on the project?
 civil servant or private law employee?
 number of working hours included in the daily rate

Record-keeping — Keep these detailed estimates on file (they may be needed during
grant preparation or later on in case of an audit).

Reporting personnel costs (financial statement)

For the financial statement you should claim the personnel costs by using a daily
rate x days worked on the action:

Daily Days
rate worked
EUR/day time records

Thus, personnel costs will effectively be based on 3 elements:

a) annual personnel costs (gross salary, including social charges and other
statutory costs)
b) annual productive days (actual annual working time)
c) time actually worked on the action

(a) annual gross salary + social charges

(c) actual number of days working
X on the action
(b) total actual annual productive working days

For reporting periods running over several years, the daily rate must be calculated
separately for each individual year. If a financial year is not closed at the end of the
reporting period, the beneficiary must use the daily rate of the last closed financial
year.
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(a) Annual personnel costs

This means costs actually paid by the beneficiary over a year, including: salary, taxes,
employer's contribution for national security schemes etc.

Calculate as follows:
1 Annual gross salary including paid overtime and salaries
for 13th and 14th 'month', if applicable
How? Add up the gross salary on every monthly salary
slip
+2 Holiday allowance, if not included in item 1 above
+3 Obligatory/compulsory social charges imposed by law,
such as pension/health/insurance schemes,
contributions to labour market funds, etc
+4 Statutory pension schemes under national law
-5 Compensation received from insurance or other
sickness/employment schemes to reactivate
unemployed people
Total Annual staff cost
(sum of 1 to 4 minus 5)

Base the calculation on statutory documents, such as salary slips and payroll
summary, so the amounts can easily be traced and verified.

Ineligible costs for this calculation:

 all additional (non-statutory) and individual pension schemes and/or sickness
insurance schemes
 company cars
 bonuses and similar fringe benefits
 dividends or profit sharing.
 amounts paid for long-term illness or maternity leave.

(b) Total actual annual productive time

This means total time in days worked over a year.

Calculate as follows:

1 Total number of days in a year 365

-2 Minus weekends 104
-3 Minus public holidays
-4 Minus annual leave actually taken
-5 Minus time compensation or flexitime
-6 Minus sickness
+7 Plus any (paid or unpaid) overtime
Total number of productive days in the year
(1 minus 2 to 6, plus 7)

Meetings trainings and similar absences — Are considered productive working

time and should not be deducted.

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(c) Actual time worked on the action

For persons allocated exclusively to the project, the time worked on the project will
not be calculated in days, but in months.

For all other persons, the time worked for the project must be calculated in days. It
must be clearly substantiated by timesheets (or equivalent time registration system).

For this purpose, every beneficiary must establish a time registration system that
meets at least the following rules:
 The timesheets (paper or electronic) must contain at least the following
information:
 grant agreement number
 name of employer
 name of employee
 day, month and year
 number of time units (days) worked on the project during the period of the
timesheet
 number of time units (days) worked on other projects/activities
 total number of time units (days) worked
 details of the tasks performed for the project
 date and signature of employee
 date and signature of supervisor.
 The timesheet should cover either a week or a month and be filled in regularly,
usually every day (timesheets created retroactively are not acceptable).
 The timesheet should be signed by the employee and approved by the supervisor
in a timely manner – ideally during the week after.

 Summary sheets (showing e.g. "x" days spent per month) are not accepted as
supporting documentation.

Record-keeping — You are strongly recommended to create a written

description of your time registration procedure, for future reference.

Specific cases (personnel costs (A)):

Persons working exclusively on the action — There is a different calculation
method for staff working 100 % on the project. They are allowed to use monthly rates
instead of hourly rates.
Moreover, they do not need to keep timesheets (but sign a declaration on exclusive
work for the action; see Article 13.1.2).
If the declaration covers months in which the person was absent for more than half of
the working days those months can NOT be taken into account to calculate the hours
worked in the action (— unless the absence is linked to annual leave).
Natural persons with direct contract — Costs for in-house consultants and similar
persons (i.e. self-employed natural persons) that work on the action under conditions
similar to those of an employee may be an eligible cost (budget category A.2), if the
following conditions are met:
 the person works for the beneficiary under a direct contract)

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 the person works under conditions similar to those of the employees (regarding
the way the work is organised and the tasks that are performed)
 the costs for the person are reasonable and not significantly different from the
costs of the employees performing similar tasks
 the person uses the beneficiary’s infrastructure/ works on the premises (i.e.
generates indirect costs for the beneficiary).
 travel and subsistence costs for the person for participating in project meetings or
project travel are paid by the beneficiary under conditions similar to those of the
employees
 the result of the person’s work belongs to the beneficiary under conditions similar
to those of the employees.

The calculation of the eligible costs for such persons follows the same rules as for
employees (i.e. daily or monthly rate, depending on part-time or exclusive work
on the action — except if the grant agreement exceptionally explicitly allows for
calculation on the basis not of time spent, but deliverables). The daily rate must
be calculated according to the rules in the grant agreement.

If the person does not work exclusively for the project, timesheets are
mandatory.

If the same person is contracted/recruited to work on different projects, with

different contracts but performing similar roles, the rates may not be higher for
the EU project.

This category does NOT cover staff provided by a temporary work agency (because
in this case there is no direct contract between the person and the beneficiary; the
contract is not with the beneficiary but with the entity hiring the person). Such staff
therefore qualifies typically as purchase of services. Thus, although NOT eligible as
"direct personnel costs" (category A), the costs can normally be charged under
budget category C.1 "subcontracted staff", if they comply with the eligibility
conditions (especially best value for money and no conflict of interest; see Article 9).

Seconded staff — Costs for persons that are seconded by a third party against
payment maybe an eligible cost under the same conditions as non-permanent staff.
Staff seconded to the beneficiary for free cannot be declared as a cost by that
beneficiary.
Permanent staff of a public organisation — For public organisations (i.e. public
bodies, with the exception of universities), the salary costs of permanent staff can be
claimed only if they relate to the costs of project activities which the organisation
would not have carried out if the project had not been undertaken.

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SUBCONTRACTING COSTS VERSUS PURCHASE COSTS

ARTICLE 9 — PURCHASE OF GOODS, WORKS OR SERVICES

9.1 Rules for purchasing goods, works or services

9.1.1 If necessary to implement the action, the beneficiaries may purchase goods, works or services.

The beneficiaries must make such purchases ensuring the best value for money or, if appropriate, the
lowest price. In doing so, they must avoid any conflict of interests (see Article 20).

The beneficiaries must ensure that the Commission, the European Court of Auditors (ECA) and the
European Anti-Fraud Office (OLAF) can exercise their rights under Articles 17 and 18 also towards their
contractors.

9.1.2 If the beneficiary is a ‘contracting authority’within the meaning of Directive 2004/18/EC (or
2014/24/EU) or ‘contracting entity’ within the meaning of Directive 2004/17/EC (or 2014/25/EU), it
must comply with the applicable national law on public procurement.

9.2 Consequences of non-compliance

If a beneficiary breaches any of its obligations under Article 9.1.1, the costs related to the contract
concerned will be ineligible (see Article 6) and will be rejected (see Article 26).

If a beneficiary breaches any of its obligations under Article 9.1.2, the grant may be reduced (see
Article 27).

Such breaches may also lead to any of the other measures described in Chapter 6.

ARTICLE 10 — IMPLEMENTATION OF ACTION TASKS BY SUBCONTRACTORS

10.1 Rules for subcontracting action tasks

10.1.1 If necessary to implement the action, the beneficiary may award subcontracts covering the
implementation of certain action tasks described in Annex 1.

Subcontracting may cover only a limited part of the action.

The beneficiary must award the subcontracts ensuring the best value for money or, if appropriate, the
lowest price. In doing so, they must avoid any conflict of interests (see Article 20).

The tasks to be implemented and the estimated cost for each subcontract must be set out in Annex 1
and the total estimated costs of subcontracting must be set out in Annex 2. The Commission may
however approve subcontracts not set out in Annex 1 and 2 without amendment (see Article 39), if:

- they are specifically justified in the finaltechnical report and

- they do not entail changes to the Agreement which would call into question the decision
awarding the grant or breach the principle of equal treatment of applicants.

The beneficiary must ensure that the Commission, the European Court of Auditors (ECA) and the
European Anti-Fraud Office (OLAF) can exercise their rights under Articles 17 and 18 also towards their
subcontractors.

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10.1.2 The beneficiary must ensure that its obligations under Articles 20, 21, 22 and 30 also apply to
the subcontractors.

If the beneficiary is a ‘contracting authority’ within the meaning of Directive 2004/18/EC (or
2014/24/EU) or ‘contracting entity’ within the meaning of Directive 2004/17/EC (or 2014/25/EU), it
must comply with the applicable national law on public procurement.

10.2 Consequences of non-compliance

If the beneficiary breaches any of its obligations under Article 10.1.1, the costs related to the
subcontract concerned will be ineligible (see Article 6) and will be rejected (see Article 26).

If the beneficiary breaches any of its obligations under Article 10.1.2, the grant may be reduced (see
Article 27).

Such breaches may also lead to any of the other measures described in Chapter 6..

1. Subcontracting costs versus purchase costs (categories C vs B/E)

How to distinguish them?

Generally speaking, the article on subcontracting sets the rules for the contracting out
of parts of the action (i.e. action tasks mentioned in Annex 1 GA), while article on
purchases sets the rules for buying of equipment, consumables and other services.
Purchases cover the procurement of ordinary services, goods or equipment needed to
carry out the project. Unlike subcontracting, they do not involve the outsourcing of
entire parts of the project (project tasks or project activities described in the
description of the action).

Examples (purchases): Dissemination of information, evaluation, audits,

translations, reproduction, purchase of tickets, renting of rooms and
accommodation, purchase of consumables and supplies, website development.

While all subcontracting must be declared under a specific budget category (C.
"subcontract"), purchases must be declared either under categories B.1 "travel
costs", B2 "Subsistence and Hotel costs", E.1 "equipment" or E.2 "other direct
costs/ other goods and services". Equipment is for assets, while other goods and
services is for consumables.

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SUBCONTRACTING COSTS

ARTICLE 6 — ELIGIBLE AND INELIGIBLE COSTS

[…]

C. Direct costs of subcontracting (including related duties, taxes and charges — except for value
added tax (VAT)) are eligible if the conditions in Article 10.1.1 are met.

[…]

1. Subcontracting costs (category C)

What costs?

This budget category covers the costs for subcontracting of a part of the action tasks
(i.e. externalising a part of the action to a third party).

You may subcontract action tasks — if you follow these rules:

 You must NOT also act as a subcontractor in the project (not possible for
beneficiaries).
 Subcontract only a limited part of the project; subcontracting all or most of the
activities would raise questions on the ownership of the project and capacity to
implement it.
 Subcontract only tasks that are absolutely necessary due to the nature of the
project and its implementation needs.
 Do NOT subcontract the management and general administration of the
project.
 For subcontracting going beyond 30% of the total eligible costs, give specific
reasons.
 Specify in Part B of the Proposal Form the tasks that will be subcontracted (and
explain what value subcontracting will add and why the relevant expertise is
not available in your consortium) and show the estimated costs in your
estimated budget.
After the grant is awarded, if you want to subcontract any tasks that were not
described in your application: notify us as specified in the grant agreement
(‘simplified approval procedure’; new subcontract must be included and
explained in the technical periodic report in the section ‘unforeseen
subcontractor’; see Article 10).

The approval is at the full discretion of the Commission and there is no automatic
entitlement to it. Beneficiaries that rely on the ‘simplified approval procedure’ bear the
full risk of non-approval and rejection of costs by the Commission.

 Retain sole responsibility for carrying out the project and for compliance with
the provisions of the grant agreement.

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 Ensure that:
o the European Commission, European Court of Auditors (ECA) and
European Anti-Fraud Office (OLAF) can exercise their rights under
Articles 17 and 18 of the grant agreement also towards your
subcontractors
o your obligations under Articles 20, 21, 22 and 30 of the grant
agreement also apply to your subcontractors.

Typically, your subcontracts should include the following terms:

 goods/services to be provided and their links to the project
 start and end dates
 price to be paid (breakdown and description of the costs)
 detailed description of the tasks/work schedule/completion phases
 detailed description of the costs on which the price is based
 payment arrangements (one or more advance payments, staggered
payments, etc.)
 clauses addressing non-performance or late completion.
 Ensure that the subcontracts are based on the best value for money
(considering the quality of the service proposed, i.e. the best price-quality
ratio) or on the lowest price.
This does NOT in all cases require a competitive selection procedure. You can
organise the tender according to your internal practices – if you can
demonstrate that you will:

 select the tender offering best value for money, or the lowest price
 avoid any conflicts of interest.

If you are acting as a contracting authority or entity (as defined, respectively,

in Directives 2014/24/EU and 2014/25/EU2), you must abide by the applicable
national public procurement rules.

How to calculate them?

Budgeting subcontracting costs

For the estimated budget, you should enter an estimate of the total amount of
subcontracts needed for the project, for each partner.

2
New directives in force since 2016:
Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public
procurement (OJ L 94, 28.3.2014, p. 65) and repealing Directive 2004/18/EC (OJ L 94, 28.03.2014,
p.65).
Directive 2014/25/EU of the European Parliament and of the Council of 26 February 2014 on public
procurement by entities operating in the water, energy, transport and postal services sectors and
repealing Directive 2004/17/EC (OJ L 94, 28.3.2014, p. 243).
Old directives:
Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the
coordination of procedures for the award of public work contracts, public supply contracts and public
service contracts (OJ L 134, 30.4.2004, p. 114).
Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the
procurement procedures of entities operating in the water, energy, transport and postal services
sectors (OJ L 134, 30.4.2004, p. 1).

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Reporting subcontracting costs (financial statement)

For the financial statement, you should include include all costs incurred for the
subcontracts.

The costs you declare must correspond to the price you paid to the subcontractors
(including all related taxes; for VAT, see Article 6.4).

Specific cases (subcontracting (C):

Framework contracts or subcontracts — Framework contracts can be used for
selecting a provider if this is the usual practice of the beneficiary (e.g. for a type of
service). In order to be eligible, the framework contract must (have) be(en) awarded
on the basis of best-value-for-money and absence of conflict of interest. The
framework contract does not necessarily have to be concluded before the start of the
action.

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PURCHASE COSTS: TRAVEL and SUBSISTENCE - EQUIPMENT -

OTHER DIRECT COSTS

ARTICLE 6 — ELIGIBLE AND INELIGIBLE COSTS

[…]

B. Direct travel and subsistence costs

Travel and subsistence costs (including related duties, taxes and charges, except for value added
tax (VAT) are eligible if they are in line with the beneficiary’s usual practices on travel.

[…]

E. Other direct costs

E.1 The depreciation costs of equipment, infrastructure or other assets (new or second-hand)
as recorded in the beneficiary’s accounts are eligible, if they were purchased in accordance with Article
9.1.1 and written off in accordance with international accounting standards and the beneficiary’s usual
accounting practices.

The costs of renting or leasing equipment, infrastructure or other assets (including related duties,
taxes and charges - except for value added tax (VAT) - are also eligible, if they do not exceed the
depreciation costs of similar equipment, infrastructure or assets and do not include any financing fees.

The only portion of the costs that will be taken into account is that which corresponds to the duration
of the action and rate of actual use for the purposes of the action.

E.2 Costs of other goods and services (including related duties, taxes and charges — except for
value added tax (VAT)) are eligible, if they are purchased specifically for the action and in accordance
with Article 9.1.1.

Such goods and services include, for instance, consumables and supplies, dissemination, protection of
results, certificates on the financial statements (if they are required by the Agreement), translations
and publications.

1. Travel and subsistence costs (category B)

What costs?

This budget category covers the travel costs and related subsistence allowances spent
for the action.

Only travel costs relating to specific and clearly identifiable activities are eligible for
EU funding and must have been incurred by people directly involved in or contracted
for such activities.

Travel and subsistence costs must be reasonable and in line with your usual practices
on travel costs.

Travel and subsistence costs of participants in conferences and seminars should also
be included under this category.

How to calculate them?

Budgeting travel & subsistence and hotel costs costs

For the estimated budget, you should enter an estimate of the total amount of travel
costs and subsistence costs (actual or per diems) needed for the project, for each
partner.

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These amounts should be a detailed and accurate estimate, based on the corporate
policy, destination, number of people involved, etc. Only eligible costs should be
budgeted.

Ideally the details should show the:

– reason for travelling (e.g. second project meeting, study visit, etc.)
– places of origin and destination
– number and, if already known, names of the people travelling/receiving
subsistence allowances
– type of unit (e.g. flights, train journeys).

Record-keeping — Keep the detailed estimates on file. You must provide these to us if
requested and you will need them at the reporting stage.

Reporting travel & subsistence and hotel costs (financial statement)

The costs you declare must correspond to the costs you incurred for travels.

Travel costs (Sub-category B.1)

For the financial statement, you should include all costs from the point of origin to the
destination, including transfers to/from airports/train stations.

All people travelling in connection with the project are required to make every effort to
use the cheapest fare and method — wherever possible, public transport.
Rail travel — First-class fares are accepted
Air travel — You must take the cheapest fare.

Cars — If air/rail travel is not cheap or possible, costs for travelling by car will be
refunded as follows:
 private vehicles (own or company cars): amount equivalent to the corresponding
(or an equivalent) rail fare
Only 1 ticket will be reimbursed, even where several people are travelling in the
same vehicle.

Record-keeping — Evidence of the corresponding rail fare (e.g. declaration of costs

from a travel agent, online quote) should be kept on file (it will be needed later on in
case of an audit).

 hire cars (maximum category B or equivalent) or taxis: actual cost, if not excessive
compared with other means of travel
Only 1 taxi fare will be reimbursed even where several people are travelling in the
same vehicle.

Subsistence and Hotel costs (Sub-category B.2)

This means cost of accommodation, meals, local travel at the place of assignment and
sundry expenses.

Such costs are eligible, if they are:

 in line with local prices
 exclusively linked to the project
 reasonable (for a guide to what is considered reasonable in each country, see
these daily (per diem) amounts).

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Record-keeping — All supporting documents for the real expenses (e.g. hotel ticket,
taxi receipts, restaurant bills) should be kept on file (it will be needed later on in case of
an audit).
You are also strongly recommended to create a written description of your
organisation’s reimbursement practices (actual costs incurred or daily per diem system).

Specific cases (travel (B)):

Rate per mile/km — Rates per mile/km will only be reimbursed if the beneficiary
provides good reasons why the normal means of calculation for car travel costs
cannot be applied.

Record-keeping — Full supporting documentation for the rate and that the rate was
actually paid should be kept on file (it will be needed later on in case of an audit).

2. Equipment costs (category E.1)

What costs?

The depreciation costs of other equipment (purchased before the beginning of the
project) are in principle part of the ‘indirect costs’ (project overheads, category F).
However, if you need to buy/rent specific equipment for the project (e.g. audiovisual
equipment), it can be charged as ‘equipment costs’ — if you follow these rules:
 Clearly demonstrate why the equipment needs to be purchased, rented or
leased for the project
 Respect the contracting rules, e.g. compare the prices of different suppliers to
see who offers the best value for money (taking account of price and quality)
 Charge to the project only the cost of equipment purchased or rented during
the period covered by the grant agreement, at a rate that reflects the degree
and duration of use for the project in that period
 Itemise the equipment with an inventory number in the organisation where it is
installed.
 Calculate the depreciation in accordance with international accounting
standards and your usual accounting practices, taking into account the rate of
actual use for the project.

Record-keeping — Keep evidence of the procedure followed for selecting the

supplier on file. You must provide these to us if requested.

If (exceptionally) explicitly authorised in your grant agreement, you may declare the
full purchase costs of the equipment (i.e. more than the depreciation for the months
of the action).

How to calculate them?

Budgeting equipment costs

For the estimated budget, you should enter an estimate of the total amount of
equipment costs needed for the project, for each partner.

This amount should be a detailed and accurate estimate, based on the depreciation.
Only eligible costs should be budgeted.

Record-keeping — Keep the detailed estimates on file. You must provide these to
us if requested and you will need them at the reporting stage.

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3. Other direct costs / other goods and services (Sub-category E.2)

What costs?

This budget category covers consumables, conferences and seminars, publications

and dissemination, translation and other costs not covered in the previous categories.

The costs of consumables and supplies are eligible — if they are exclusively used for
the project and identifiable as such in your accounts and if the purchasing rules were
complied with (best value for money).

Publications must be produced specifically for the project and comply with the
Guidelines on visibility of EU funding.

Costs for conferences, seminars and other events do NOT include any travel and
subsistence allowances provided for participants (these should be put under ‘travel’,
category B).
Other costs not falling under any other category can be charged under category E, if
they are necessary and specific to the project activities and contribute to its final
results.

Typically these includes:

• costs of services (e.g. experts not considered staff members, specific
evaluation of the project, auditor fees)
• conference fees; meeting registration costs
• charges for financial transactions; fees for a bank guarantee requested by us
• purchase of information materials specific and key to project implementation
(books, studies, electronic data)
• project-specific press releases and event advertisements (one-off costs)
• purchase of copyrights and other intellectual property rights (IPR)
• intellectual property costs connected with publishing project materials (e.g.
CD-ROMs)
• other costs stemming from obligations under the grant agreement which are
not budgeted for under another budget category.
General office supplies (pens, paper, folders, ink cartridges, electricity supply,
telephone and postal services, internet connection, software, etc.) are ‘indirect costs’,
belonging in category F — unless unusually high quantities of such supplies are
required due to the specific circumstances.

Costs of purchasing land or immovable property are not eligible. For the costs of
premises rented to carry out the project, you will have to provide a specific rental
contract/lease indicating a clear and exclusive link with the project. If this link is not
demonstrated, the cost will be considered covered by the indirect costs.

How to calculate them?

Budgeting other goods & services costs

For the estimated budget, you should enter an estimate of the total amount of all
other goods and services needed for the project, for each partner.

These amounts should be a detailed and accurate estimate, based on type of

publication (languages and number of copies/pages, etc), conference/seminar/event
or other cost. Only eligible costs should be budgeted.

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Publication & dissemination

Publication and dissemination costs include costs for editing, translation and printing,
as well as costs for website creation and/or maintenance (keep track of these costs
separately — separate lines for editing, printing, translation, etc.).

The details should include the following:

for publications:
– title
– reference number of the output in Annex 1 GA (e.g. work package
4, output 3 - Conference)
– type of publication (e.g. brochure, leaflet)
– language(s) in which it will be produced
– estimated number of pages
– number of copies
– type of unit (usually number of pages or number of copies).
for translations:
– title of the publication
– reference number of the output in Annex I (e.g. work package 4,
output 3)
– source and target languages (e.g. from English into Italian)
– number of pages
– type of unit (e.g. pages).

Conferences, seminars and other events

Costs for conferences, seminars and other events include costs for renting of rooms,
interpreting, catering, etc. (keep track of these costs separately — separate lines for
renting of rooms, interpreting, catering, etc.).

The details should show:

for renting of rooms:
- expected number of participants
- duration of the event (e.g. days, half-days or number of hours)
- title of the event in Annex 1 GA
for interpreting:
- number of interpreters per day
- number of days interpreting needed
- source and target languages (e.g. English into French & vice versa)
- type of unit to count (e.g. days of interpreting)

for catering:
- type of catering costs (e.g. lunch, coffee break)
- number of items
- number of participants
- type of unit to count (e.g. participants).

Record-keeping — Keep the detailed estimates on file. You must provide these to us if
requested and you will need them at the reporting stage.

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Reporting other goods & services costs (financial statement)

For the financial statement, you should include costs for goods and services.

Catering costs must not include people receiving subsistence allowance for the same
event, unless such costs are deducted from their allowance.

Specific cases (travel, equipment & other goods and services (B, E):
Rate per mile/km — Rates per mile/km will only be reimbursed if the beneficiary
provides good reasons why the normal means of calculation for car travel costs cannot
be applied.

Record-keeping — Full supporting documentation for the rate and that the rate was
actually paid should be kept on file (it will be needed later on in case of an audit).

Beneficiary per diem system (daily allowance) — Per diems will be reimbursed if
they are part of the beneficiary's usual practices (i.e. you can demonstrate that such
a system was officially in place before the grant was awarded).
The per diem rate cannot exceed the maximum limits per country set by the
European Commission. Any costs declared in excess of this limit will be considered
ineligible.
Per diems including accommodation will be accepted only when an overnight stay is
necessary (because of the timing of the return). If the overnight stay was not
necessary, a proportion of 60% will be considered for accommodation and rejected.

FINANCIAL SUPPORT TO THIRD PARTIES (Not applicable)

ARTICLE 6 — ELIGIBLE AND INELIGIBLE COSTS

D. Direct costs of providing financial support to third parties

Not applicable

Not applicable.

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INDIRECT COSTS

F. Indirect costs

For the "Training, Conference and Staff Exchange" and "Legal Training and Studies" Calls:

Indirect costs are eligible if they are declared on the basis of the flat-rate of 7% of the eligible
direct costs (see Article 5.2 and Points A to E above).

Beneficiaries receiving an EU operating grant1 cannot declare indirect costs for the period covered by
the operating grant, unless they can demonstrate that the operating grant does not cover any costs
of the action.]

For the"Technical Assistance" Call:

Indirect costs are not eligible.

[…]

21
For the definition, see Article 121(1)(b) of the REGULATION (EU, Euratom) 2018/1046 of
the European Parliament and of the Council of 18 July 2018 on the financial rules
applicable to the general budget of the Union, amending Regulations (EU) No
1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No
1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 83/2014, and
Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012:
‘operating grant’ means direct financial contribution, by way of donation, from the budget in
order to finance the functioning of a body which pursues an aim of general Union interest or has
an objective forming part of and supporting an EU policy.

1. Indirect costs (category F)

Commonly known as overheads. These are costs that cannot be identified as specific
costs directly linked to the project and so booked to it directly.

They cover general indirect costs you incur in implementing the project, typically:
• general rental costs or depreciation of buildings and equipment
• maintenance costs
• telecommunication and postal fees
• water, gas, electricity, heating, etc.
• office furniture
• supplies and petty office equipment
• insurance
• costs connected with support services, such as administrative and financial
management, human resources, training, documentation, IT, etc.

Eligible indirect costs are calculated (automatically by the system), with a flat-rate
instead of actual costs.
This rate fixed in the grant agreement is:
- 7% of the direct eligible costs for the "Training, Conference and Staff
Exchange" and "Legal Training and Studies" calls,
- 0% of the direct eligible costs for the "Technical Assistance" call.

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This means that your indirect costs will depend directly on your direct costs. And that
you will not need to keep track of your actual indirect costs.

Combining action & operating grants — Beneficiaries that also receive an EU operating
grant can NOT charge any indirect costs for the reporting period(s) covered by the operating grant,
unless they are able to demonstrate cost separation (i.e. that the operating grant does not cover
any costs that may be claimed under the action).
Operating grants are annual grants to finance the operation and running costs of an entity (e.g.
call COMM-C2/01-2013 under the Europe for Citizens programme).
Example: Entity A receives an operating grant under the Europe for Citizens programme for
the financial year 2016 (i.e. from 01.01.2016 until 31.12.2016) The operating grant is not
renewed in 2017. On 01.04.2016, entity A signs an COSME action grant with one reporting
period of 18 months (01.04.2016 – 31.12.2017). Beneficiary A may declare the indirect costs
in the COSME action grant as follows:
 from 01.04.2016 to 31.12.2016 ONLY IF it can demonstrate that the operating grant
does not cover any costs of the action (see beow);
 from 01.01.2017 – 31.12.2017 under the normal COSME rules (i.e 7% of the direct
eligible costs since there is no operating grant covering the 2017 financial year).
To demonstrate cost separation, the following conditions must be fulfilled:
 the operating grant may NOT cover 100% of the beneficiary’s annual budget (i.e. it may
not be a full operating grant)
 the beneficiary must use analytical accounting which allows for a cost accounting
management with cost allocation keys and cost accounting codes AND must apply these
keys and codes to identify and separate the costs (i.e. to allocate them to either the action
grant or the operating grant)
 the beneficiary must record:
 all costs incurred for the operating grant (i.e. personnel, general running costs and
other operating costs linked to the WP) and
 all costs incurred for the action grants (including the indirect costs linked to the action)
 the allocation of the costs must be done in a way that leads to a fair, objective and
realistic result.
Beneficiaries that cannot fulfil these conditions must EITHER:
 terminate the operating grant, in order to sign the action grant with indirect costs
 keep the operating grant, but sign the action grant without indirect costs.
The possibility to combine operating grants with action grants if costs are separated was introduced
with GA version 4.0. It applies also to older grant agreements, if the beneficiaries can demonstrate
that there is no double funding, in accordance with the above-listed principles (analytical
accounting tools, full cost recording, fair allocation).
Best practice: In case of an overlapping EU operating grant, the beneficiary should immediately
contact the Commission (via the Funding & Tenders Portal). Be aware that operating grants are not
always easy to identify. They exist under various labels (operating grants; financial
contributions/support to the functioning/operation of entities; etc.). Check your call text.

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INELIGIBLE COSTS

6.4 Ineligible costs

‘Ineligible costs’ are:

(a) costs that do not comply with the conditions set out above (Article 6.1 to 6.3), in particular:
(i) costs related to return on capital;
(ii) debt and debt service charges;
(iii) provisions for future losses or debts;
(iv) interest owed;
(v) doubtful debts;
(vi) currency exchange losses;
(vii) bank costs charged by the beneficiary’s bank for transfers from the Commission;
(viii) excessive or reckless expenditure;
(ix) VAT (deductible or not deductible) ;
(x) costs incurred during suspension of the implementation of the action (see Article 33);
(xi) in-kind contributions provided by third parties;

(b) costs declared under another EU grant (including grants awarded by a Member State and financed
by the EU budget and grants awarded by bodies other than the Commission for the purpose of
implementing the EU budget); in particular, indirect costs if the beneficiary is already receiving an
operating grant financed by the EU budget in the same period, unless they can demonstrate that
the operating grant does not cover any costs of the action;

(c) costs for staff of a national (or regional/local) administration, for activities that are part of the
administration’s normal activities (i.e. not undertaken only because of the grant);

(d) costs (especially travel and subsistence costs) for staff or representatives of EU institutions, bodies
or agencies;

6.5 Consequences of declaration of ineligible costs

Declared costs that are ineligible will be rejected (see Article 26).

This may also lead to any of the other measures described in Chapter 6.

1. Ineligible costs

Costs are ineligible, if one of the following applies:

 they do not meet the general and specific eligibility conditions set out in
Articles 6.1 to 6.3
Examples: costs incurred in relation to activities not indicated in Annex 1 to the
grant agreement (description of the action); subcontracting costs do not comply
with Article 10; taxes for which you are liable in your capacity as a business (e.g.
IRAP in Italy, Gewerbesteuer in Germany); gifts and presents;
recreational/tourism/cultural activities; costs not entailing a cash flow for you;
costs incurred by a third party to the grant agreement.
 they are listed in Article 6.4, in particular:
 costs related to return on capital or return generated by an investment
Examples: dividends paid as remuneration for investing in the action;
remuneration paid as a share in the company’s equity.

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 debt and debt service charges

‘Debt service’ is the amount paid on a loan in principal and interest over a
period of time.
Example: If a beneficiary takes a loan used to acquire equipment or
consumables for the project of EUR 100 000 at 9 percent interest for 10 years,
the debt service for the first year (principal and interest) is EUR 15 582.
 provisions for future losses or debts
‘Provision’ means an amount set aside in an organisation’s accounts, to cover
for a known liability of uncertain timing or amount. This includes allowances for
doubtful or bad debts.
 interest owed (i.e. interest on a loan to borrow capital)
 excessive or reckless expenditure
‘Excessive’ means paying significantly more for products, services or personnel
than the prevailing market rates or the usual practices of the beneficiary (and
thus resulting in an avoidable financial loss to the action).
‘Reckless’ means failing to exercise care in the selection of products, services or
personnel (and thus resulting in an avoidable financial loss to the action).
 currency exchange losses (i.e. for beneficiaries using currencies other than
euros or being invoiced in a currency other than the currency they use: any loss
due to exchange rate fluctuations (e.g. between the date of invoicing and the
date of payment))
This includes insurance premiums against risk of exchange rate losses.
 bank costs charged by the beneficiary’s bank for transfers from us.
Conversely, bank charges for the distribution of the EU funding may constitute
an eligible cost for the coordinator (if the eligibility conditions of Article 6.1 and
Article 6.2.E.2 are met).
 VAT
 costs incurred during the suspension of the implementation of the
action
Example: Action is suspended and one of the beneficiaries continues working
on it after the date of the suspension
 costs declared under another EU grant (i.e. double funding)
This includes:
 costs funded directly by other EU programmes managed by the European
Commission or its executive agencies or funding bodies (e.g. H2020 grants,
Euratom grants)
 costs managed/funded/awarded by Member States but co-funded with EU
funds (e.g. European Structural and Investment Funds (ESIF))
 costs for grants awarded/funded/managed by other EU, international or
national bodies and co-funded with EU funds (e.g. Joint Undertakings, Article
185 TFEU bodies)
 if a beneficiary is receiving an EU operating grant3, then the indirect costs of
that beneficiary are not eligible and the indirect cost flat-rate should not be
3
For the definition, see Article 180(2)(b) of the Financial Regulation (EU, Euratom) 2018/1046:
‘operating grant’ means direct financial contribution, by way of donation, from the budget in order to
finance the functioning of a body which pursues an aim of general Union interest or has an objective
forming part of and supporting an EU policy.

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applied — unless it can demonstrate that the operating grant does not cover
any costs of the action (see Article 6.2.F).
Examples (operating grants): Grants awarded to support the running
costs of certain institutions pursuing an aim of European interest, such as:
College of Europe, European standards bodies (CEN, CENELEC, ETSI)
 costs for staff of a national (or local) administration, for activities that are part
of the administration’s normal activities (i.e. not undertaken only because of the
grant)
For public organisations (i.e. public bodies, with the exception of universities),
the salary costs of permanent staff be claimed only if they relate to the costs of
project activities which the organisation would not have carried out if the project
not been undertaken.
 travel, subsistence and any other costs for EU staff (or elected representatives
of the EU Parliament)
The eligible countries are listed in the call document. You can have project
activities outside these countries, but this will be solely at your own expense —
they will not be eligible.
 cost categories explicitly excluded in the call (if option applies).

If a beneficiary declares ineligible costs, the ineligible costs will be rejected and, if
needed, other measures specified in Chapter 6 (e.g. suspension, termination, grant
reduction, etc.) may be taken.

Specific cases (ineligible costs):

Duties — The eligibility of duties depends on the eligibility of the cost item to which
they are linked (i.e. in whose price they are included). If the item is eligible, the duty
is also eligible.
In-kind contributions — This means non-financial resources made available free of
charge by third parties to a beneficiary, such as:
 donations of raw materials (e.g. paper and ink for publication purposes)
 unpaid volunteer work or provision of services
 any other good or service provided to the project whose cost is borne by another
organisation and not reimbursed by the beneficiary.
They are not an eligible cost and can NOT be included when calculating total eligible
costs and the final grant amount (nor should they be reported as receipt at final
reporting stage).

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KEEPING RECORDS — SUPPORTING DOCUMENTATION

ARTICLE 13 — KEEPING RECORDS — SUPPORTING DOCUMENTATION

13.1 Obligation to keep records and other supporting documentation

The beneficiaries must — for a period of [OPTION 1 by default: five][OPTION 2 for low value
1
grants : three] years after the payment of the balance — keep records and other supporting
documentation in order to prove the proper implementation of the action and the costs they declare
as eligible.

They must make them available upon request (see Article 12) or in the context of checks, reviews,
audits or investigations (see Article 17).

If there are on-going checks, reviews, audits, investigations, litigation or other pursuits of claims
under the Agreement (including the extension of findings; see Article 17), the beneficiaries must
keep the records and other supporting documentation until the end of these procedures.

The beneficiaries must keep the original documents. Digital and digitalised documents are
considered originals if they are authorised by the applicable national law. The Commission may
accept non-original documents if they considers that they offer a comparable level of assurance.

13.1.1 Records and other supporting documentation on the technical implementation

The beneficiaries must keep records and other supporting documentation on the technical
implementation of the action, in line with the accepted standards in the respective field.

13.1.2 Records and other documentation to support the costs declared

The beneficiaries must keep the records and documentation supporting the costs declared, in
particular the following:

(a) for actual costs: adequate records and other supporting documentation to prove the costs
declared, such as contracts, subcontracts, invoices and accounting records. In addition, the
beneficiaries’ usual cost accounting practices and internal control procedures must enable
direct reconciliation between the amounts declared, the amounts recorded in their accounts
and the amounts stated in the supporting documentation;

(b) for unit costs, flat-rate costs and lump-sum costs: not applicable

In addition, for personnel costs (declared as actual costs), the beneficiaries must keep time
records for the number of days declared. The time records must be in writing and approved by the
persons working on the action and their supervisors, at least monthly. In the absence of reliable
time records of the days worked on the action, the Commission may accept alternative evidence
supporting the number of days declared, if it considers that it offers an adequate level of assurance.

As an exception, for persons working exclusively on the action, there is no need to keep time
records, if the beneficiary signs a declaration confirming that the persons concerned have worked
exclusively on the action.

[OPTION to be added if Article 11 applies: For costs declared by linked third parties (see Article
11), it is the beneficiary that must keep the originals of the financial statement(s) and the
certificates on the financial statement(s) of its linked third parties.]

13.2 Consequences of non-compliance

If a beneficiary breaches any of its obligations under this Article, costs insufficiently substantiated
will be ineligible (see Article 6) and will be rejected (see Article 26), and the grant may be reduced
(see Article 27).

Such breaches may also lead to any of the other measures described in Chapter 6.

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1. Records and other supporting documentation

The beneficiaries must keep appropriate and sufficient evidence to prove the
eligibility of all the costs declared, proper implementation of the action and
compliance with all the other obligations under the GA.

Costs that are not supported by appropriate and sufficient evidence may be
rejected (and other measures described in Chapter 6 may be applied as well).

.
The evidence must be the same as that which would be accepted by the national (tax)
authorities.
The evidence must be verifiable, auditable and available. It must be persuasive
enough .for our auditors, who assess it according to generally accepted audit
standards.4

Appendix 2 lists the records and documents (per cost category) that may serve as
evidence.
It must be kept for at least 5 years after the balance is paid (3 years for grants up to
EUR 60 000). If you throw supporting documents away during this period, you risk
that the grant is reduced, that costs are rejected and that amounts already paid to
you will be recovered.

We may require to see documents of any beneficiary in the consortium (both

coordinator and co-beneficiaries).
If there are ongoing procedures such as audits, investigations or litigations, the
evidence must be kept until these end, even if this is longer than five (or three)
years.

The rules in the grant agreement do not affect national laws on keeping documents
(which may require additional measures).

2. Original documents

The beneficiaries must keep original documents.

They will be accepted by us as originals, if considered an original under national law.

Examples:
1. The Commission will accept authenticated copies or digitally-signed documents,
if national law accepts these as originals.
2. The Commission will accept digitalised copies of documents (instead of hard
copies), if this is acceptable under national law.

This means that documents should be kept in the format in which they were received
or created:

 documents received or created in paper form should be kept in paper form

 documents received or created electronically should be kept in their electronic
format.

4
International Standard on Auditing ISA 500 ‘Audit Evidence’.

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Hard copies of original electronic documents are not needed.

Costs that are not supported by appropriate and sufficient evidence may be rejected (and
other measures described in Chapter 6 may be applied as well).

If you are asked to provide supporting documents, it is enough to send copies.

3. Records for actual costs

For actual
. costs, the beneficiaries must:

 keep detailed records and other supporting documents to prove the eligibility of
the costs declared

 use cost accounting practices and internal control procedures that make it
possible to verify that the amounts declared, amounts recorded in the accounts
and amounts recorded in supporting documentation match up.

Best practice: The information included in the financial statements for each budget
category (i.e. personnel costs, travel and subsistence costs, subcontracting costs,
other direct costs) must be broken down into details and must match the amounts
recorded in the accounts and in supporting documentation.

Examples:
1. For costs declared in category A (Direct personnel costs): the costs must be
detailed for each person carrying out work for the action (individual daily rate
multiplied by the actual days worked for the action). They must match the
accounting records (i.e. general ledger transactions, annual financial
statements) and supporting documentation (i.e. labour contracts, collective
labour agreements, applicable national law on taxes, labour and social security
contributions, payslips, time records, bank statements showing salary
payments, etc.).
2. For costs declared in categories B, C and E (Travel, susbsistence,
subcontracting and other direct costs): the beneficiary must keep a breakdown
of costs declared by type (i.e. travel costs and related subsistence allowances,
depreciation, costs of other goods and services etc.). It should be able to
provide details of individual transactions for each type of cost. For
depreciation, it must be able to provide details per individual equipment used
for the action. Declared costs must match accounting records (i.e. general
ledger transactions, annual financial statements) and supporting
documentation (i.e. purchase orders, delivery notes, invoices, contracts, bank
statements, asset usage logbook, depreciation policy, etc.).

4. Records for unit costs set by the EU

(Not applicable)

5. Records for unit costs calculated in accordance with the

beneficiary’s usual cost accounting practices

(Not applicable)

6. Certificate on the methodology (CoMUC)

(Not applicable)

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7. Records for flat-rate costs

For flat-rate costs, the beneficiaries must:

 keep detailed records and other supporting documents to prove that the costs to
which the flat rate is applied are eligible.

Example: For the flat rate of 7 % of direct costs, the auditors will verify (and the
beneficiaries must be able to demonstrate) that the actual direct costs are
eligible, using the detailed records and supporting documents detailed above.

8. Records for lump-sum costs

(Not applicable)

9. Records for personnel costs — Days worked for the action

The records for personnel costs depend on whether the person worked exclusively for
the action or not.

Exclusive work or not matters ALSO for the calculation of the costs to be declared (— in
this case they must be calculated through an simple monthly rate; see Article 6.2.A).

For persons who work exclusively for the action (regardless if they are full-time
or .part-time employees), the beneficiary may either:

 sign a declaration on exclusive work for the action (one per reporting period), to
confirm that the person worked exclusively for the action, either:

 during the whole reporting period

or

 during an uninterrupted time-period, covering at least a full calendar month

within the reporting period.

Best practice: Beneficiaries should take a prudent approach and use this
possibility only if it is planned that the person works exclusively on the action
during a long and continuous period of time. If there are any doubts, a record
of actual hours worked should be kept (e.g. time-sheets).

‘Exclusive work’ means that the person carried out NO OTHER activities for the
beneficiary than those of the action.

Intermittent (i.e. sporadic or random) periods of ‘exclusive’ dedication can NOT

be subject of a declaration. If a person worked randomly for the action after an
uninterrupted time-period covered by a declaration, time-sheets are needed
for the period of random work.

Example: The person worked for the action exclusively from 15/02 to 31/05
and then worked again in the action some days in July and October and the
full month of November. The declaration will cover the period from 15/02 to
31/05 and time records must be kept for the time the person worked for the
action in July, October and November.

If a person worked under different regimes during the reporting period

(exclusive and non-exclusive), the declaration may be used ONLY for a period
of exclusive work. The other months must be recorded with time-sheets.

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If there were several periods of exclusive work during one reporting period,
the beneficiary may choose to use the declaration for the longest one (and use
the monthly time-sheets for the others).

The declaration must be dated and signed by the person concerned AND the
supervisor.

 keep time records.

Best practice: If the person works exclusively for the action during a full
financial year, it is strongly recommended that the beneficiary signs the
‘declaration on exclusive work for the action’ (— even if the person keeps time
records). In this way, the declaration can serve as evidence that the person
worked for the action all her/his annual productive hours.

For persons who do NOT work exclusively for the action, the beneficiaries must:

 show the actual hours worked, with reliable time records (i.e. time-sheets)
either on paper or in a computer-based time recording system.

Time records must be dated and signed at least monthly by the person
working for the action and his/her supervisor.

If the time recording system is computer-based, the signatures may be

electronic (i.e. linking the electronic identity data (e.g. a password and user
name) to the electronic validation data, with a documented and secure process
for managing user rights and an auditable log of all electronic transactions).

Time records should include, as a minimum:

 the title and number of the action, as specified in the GA
 the beneficiary’s full name, as specified in the GA
 the full name, date and signature of the person working for the action
 the number of hours worked for the action in the period covered by the
time record
 the supervisor’s full name and signature
 a reference to the action tasks or work packages of Annex 1, to which
the person has contributed by the reported working hours.

Information included in time-sheets must match records of annual leave,

sick leave, other leaves and work-related travel.

A template for time-sheets with these minimum requirements is available.

(This template is not mandatory; beneficiaries may use their own model,
provided that it fulfils the minimum conditions and it contains at least the
information detailed above.)

If time records are not reliable, the Commission may exceptionally accept
alternative evidence if it proves the number of hours worked on the action with
a similar (or at least satisfactory) level of assurance (assessed against generally-
accepted audit standards).

The Commission has full discretion to accept or refuse the alternative evidence
and there is no entitlement to it. Beneficiaries that rely on alternative evidence
bear the full risk of refusal and rejection of costs by the Commission.

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Examples of possible alternative evidence (non-exhaustive list): travel

documents proving participation in a project meeting (boarding pass,
obliterated travel ticket, hotel invoice, etc.); agenda and minutes of the
meeting; attendance lists; working papers; laboratory log books;
professional/personal diaries; documents related to presentations; scientific
publications; correspondence such as letters, notes, memos, emails; etc.

The auditors will use the following three criteria to assess how credible the
alternative evidence is:
1. Clear identification of the person concerned
2. Clear link to the project under scrutiny
3. Possibility to quantify time spent on project-related tasks.

Alternative evidence will only be accepted if these three criteria are met.

Example (acceptable alternative evidence):

A researcher submits the following email as alternative evidence: ‘I hereby
send you the results of the analysis of project XYZ that I have been
working on for the last two weeks.’
Criterion 1 is met – the sender of the email is the person concerned
Criterion 2 is met – the project is identified as XYZ
Criterion 3 is met – the time is quantified: two weeks

Example (not acceptable alternative evidence):

A beneficiary submits the following email as alternative evidence: ‘I hereby
send you the results of the analysis recently carried out by my team.’
Criterion 1 is not met – it is unclear who the person concerned is; the team
members and their contributions are unknown
Criterion 2 is not met: the project name is not mentioned
Criterion 3 is not met – the time is not quantified

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APPENDIX 2 - LIST OF RECORDS & SUPPORTING

DOCUMENTS PER COST CATEGORY
Personnel costs

All staff categories

 The total cost of the employee (comprising actual salary, statutory social
security charges and other statutory costs included in the remuneration) and
the amount allocated to the project
 Proof of regular salaries (salary grids) in your organisation.

Staff working exclusively on the project

 Their existing contract with the beneficiary

 Assignment letter, specifying their tasks, a reference to the project and the
duration of their allocation to it
 Declaration on exclusive work
 Monthly salary slips
 Proof of payment.

Such staff must be registered in the beneficiary's payroll and accounting system.

Timesheets are NOT required.

Staff allocated partly to the project

 . Their existing contract with the beneficiary

 Timesheets (or equivalent time-recording system)
 Salary slips
 Proof of payment
 Calculation of the daily rate requested

Such staff must be registered in the beneficiary's payroll and accounting system.

Timesheets are mandatory.

Non-permanent staff

Natural. persons with direct contract (non-permanent staff)

 Direct contract with the beneficiary with description of tasks, the duration of
the contract, working time and remuneration
 Timesheets (or equivalent time-recording system)
 Invoices stating tasks performed, date, number of hours worked and amount
to be paid
 Proof of payment.

The calculation of the eligible costs for such persons follows the same rules as for
employees (i.e. daily or monthly rate, depending on part-time or exclusive work on the
action — except if the grant agreement explicitly allows for calculation on the basis not of
time spent, but deliverables). The hourly/daily rate must be calculated according to the
rules in the grant agreement.

If the person does not work exclusively for the project, timesheets are
mandatory.

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Travel & subsistence costs

Travel costs

 Copies of tickets (airplane, train, bus, etc.), including boarding passes when
applicable
 Copies of invoices for flight or rail tickets (if bought online, a confirmation
email is acceptable, providing it states the price paid)
 Travel by car: reimbursement claim, explanation of the reimbursement
calculation, copy of the internal reimbursement policy, if available (maximum
of the equivalent first-class rail fare)
 Proof of payment
 Attendance list signed by the participants (for meetings and conferences).

Subsistence costs

 Expenses claim form indicating place, date and time — signed and dated by
the employee and the organisation authorising the expenditure (employer)
 Proof of accommodation (hotel invoice)
 Copies of all receipts related to food and beverages, local transport and other
expenses
 Attendance list signed by the employees
 Proof the employee was reimbursed for their claimed costs.

Direct costs of subcontracting

 Invoice
 Documentation of the procedure used to award contracts: copies of bids
received, records related to the award process (comparisons of individual bids,
minutes of meetings, etc.)
 Proof of payment
 Subcontracting agreement.

The subcontracting agreement should include the following terms:

 goods/service to be provided and links with the project (it is advisable to
include a reference to the project)
 start and end dates
 price to be paid (breakdown and description of the costs)
 detailed description of the tasks/work schedule/completion phases
 detailed description of the costs on which the price is based
 payment arrangements (one or more advance payments, staggered
payments, etc.)
 clauses/penalties for non-performance or late completion.

Equipment
.
 Copies of invoices stating when the equipment was purchased and delivered
 Proof of payment
 Calculation of the amount requested
 Internal rules on depreciation.

Invoices related to the purchase of goods or equipment must bear the grant reference,
date of purchase and delivery. Invoices for services must also specify the date(s) the
services were provided.

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Other direct costs

 Invoice, stating the following:

o editing — type/name of the publication and number of pages/words
o translations — title of the publication/document, translated languages
(from-to) and number of pages/words
o printing — type/title of the publication, number of pages and number of
copies
o conferences — detailed calculations of the relevant costs, e.g.:
o for room rental — number of participants, number of days/hours
of the stay
o for interpreting services — cost per interpreter per day,
languages involved)
 Procedure used to award contracts:
 Copies of price offers requested, including the description of the good or
service to be provided
 Copies of bids received
 Records related to the award procedure (comparisons of individual bids,
minutes of meetings, etc.)
 Proof of payment.

Invoices related to the purchase of goods or equipment must bear the grant reference,
date of purchase and delivery. Invoices for services must also specify the date(s) the
services were provided.

Indirect costs

No supporting documents are required (amount automatically calculated as flat-rate

of the eligible direct costs).

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