Intra-Africa Workshop on Financial Management
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1 Intra-Africa Workshop on Financial Management Alina FILIMON Nathalie HOSTE-LUXEN Alba Chiara TIBERI EACEA A Projects kick-off meeting meeting Brussels, 5-6 February 2018 Image :: Shutterstock.com DEVCO European Commission
2 Outline of the presentation Introduction on project budget: Lump Sums and Unit Costs Lump Sums and Unit Costs subheadings: relevant rules, calculation and supporting documents How to calculate the EU contribution to the scholarships - Rules on calculation of mobility duration - exercises on calculation of scholarships Exchange rate: recommendations 2
3 PROJECT BUDGET Lump sums and unit costs 3
4 1. Lump sum (for organisation of the mobility) To cover management costs (e.g. organisation/participation in partnership meetings, participation in EACEA meetings, promotional activities, hiring support staff, etc.) Each partner should be actively involved in the management activities of the partnership. 4
5 2. Unit costs (for implementation of the mobility) Sub-headings: A. subsistence, settling-in, female students allowances B. participation costs C. research costs D. travel and visa costs E. insurance costs Unit costs eligible at the end of the project if the individual mobility took place and respects the Call and Grant Agreement's provisions 5
6 NO transfer of budget allowed between 1. Organisation of the mobility (lump-sum) and 2. Implementation of the mobility (Unit cost) but ONLY WITHIN the sub-headings of 2. Implementation of the mobility 6
7 Example of budget transfers: Budget in (Grant Agreement) Case 1- Transfer allowed Expenditure in (after implementation) Case 2- Transfer not allowed 1. Organisation of the mobility Implementation of the mobility Subsistence allowances Travel costs Participation costs Research costs Insurance costs TOTAL
8 1. LUMP-SUM Organisation of the mobility A. How is it calculated? x number of active partners, including the EU Technical Partner B. How can it be distributed among partners? - It's an internal decision - depending on the needs of each partner - ALL partners must AGREE with the distribution and include it in the Memorandum of Understanding (to be signed by the LRs) 8
9 2. Unit Costs - Implementation of the mobility A. ALLOWANCES Subsistence allowance monthly instalments for the total duration in months of the mobility to be paid in full and on a monthly basis Settling-in allowance (for students only) Allowance for female scholarship holders 1 more instalment of subsistence allowance provided upon arrival 1 more instalment per academic year only for mobility equal or longer than 2 academic years (minimum 20 months + fulfilment of academic obligations) The total duration of the mobility and the various allowances to be paid to the scholarship holder must be clearly indicated in the student/mobility agreement. 9
10 B. PARTICIPATION COSTS (tuition and/or registration fees, additional library costs, student unions, residence permit, language courses costs etc.) Mobility of more than 10 months One unit cost per academic year* per mobility Total amount managed by the partnership / share based on actual participation costs of incoming students (rules to be established in the MoU) Mobility of less than 10 months No participation costs Students continue paying tuition fees at their home institution *1 academic year = minimum 10 months + all the academic obligations corresponding to 1 academic year fulfilled 10
11 C. RESEARCH COSTS (laboratory consumable expenses, field research costs, registration for online research platforms etc.) Mobility of more than 10 months Mobility of less than 10 months One unit cost per academic year* per mobility The total amount is managed by the partnership / share based on actual research needs of incoming students (rules to be established in the MoU) No research costs *1 academic year = minimum 10 months + all the academic obligations corresponding to 1 academic year fulfilled 11
12 D. TRAVEL AND VISA COSTS One unit costs granted for each student/staff in mobility (inbound+ outbound travel) For mobility equal or longer than 2 academic years* => 2 unit costs granted (if 2 travels have taken place) Amount based on the distance ''as the crow flies'' (departure location - depending on target group -> host institution) The total amount is managed by the partnership *2 academic year = minimum 20 months + all the academic obligations corresponding to 2 academic years fulfilled 12
13 Calculation of Unit Costs for travel and visa Target Group Distance (Km) DURATION Travel and visa costs Distance between host HEI and: TG1 location of the home HEI To apply the correct unit cost, calculate Km using the tool indicated in the Call For mobility = or > than 2 academic years two unit costs are allowed TG2 location of origin of the student 13
14 E. INSURANCE COSTS One unit cost per month/scholarship holder. Insurance cover must take effect by the time the scholarship holder start her/his journey to participate in the mobility and must be valid until one month after the end of the mobility. The total amount is managed by the partnership to ensure full insurance coverage for each student. 14
15 Supporting documents All the documents for a grantee must be coherent (same duration, same dates) A. Allowances B. Participation C. Research student agreement, proof of bank transfers in favour of the grantee, cash receipt signed by the grantee based on real duration of the mobility and various supporting documents (student agreement, research activities report, ) D. Visa and Travel tickets, boarding pass, travel agency invoice E. Insurance nominal insurance certificate, insurance policy contract justifying/proving the actual respect of the minimum insurance requirements 15
16 Calculation of the EU contribution per mobility: Subsistence allowances To be paid in full to scholarship holders per month of mobility 600 / month for Master 900 / month for Doctorate / month for Staff Duration of mobility (in months) Participation Costs Research costs Travel and visa costs <10 months=0 > or = 10 months= Master/academic year Doctorate/academic year <10 months = 0 > or= 10 months = 600 Master/academic year Doctorate/academic year Based on target group + distance in Km + mobility duration -> one or two Unit Costs Managed by the partnership Insurance costs 75 x number of months for each scholarship holder 16
17 Calculation of the final grant Final Grant is solely calculated based on the activities actually occurred and NOT on the real costs incurred Example Grant Awarded and paid (pre-financings): Final Grant calculated: Amount to be reimbursed: EUR EUR EUR (even if real costs incurred = EUR) NO actual costs to be reported 17
18 Examples and exercises How to calculate the mobility duration and the EU contribution for the scholarships 18
19 How to calculate mobility duration in months Duration in months = Duration in days / 30 Duration in days = number of calendar days between start and end (30 = average number of days per month) The result (2 decimals) must be rounded to the nearest integer: if the decimals are < 49 => the number of months is rounded down; if the decimals are > or = to 50, the number of months is rounded up. Example start date 20/01/2017, end date 30/07/2017 => 191 days 191:30 = 6,37 the nearest integer to 6,37 is 6 => 6 months to be encoded in EMT 19
20 EXAMPLE 1 Allowances to be paid to female scholarship holders: - Female, Doctorate candidate - Duration of the mobility 20 months (01/01/ /08/2019) j Settling-in allowance: 1 instalment Subsistence allowance: 20 instalments Allowance for female scholarships: 2 instalments TOTAL: 23 instalments 23 x 900 EUR = EUR to be paid in full to the scholarship holder To be encoded in EMT and in the student agreement: 20 months of duration BUT 23 instalments of subsistence allowances 20
21 EXAMPLE 2 Allowances to be paid to female scholarship holders: Female, Doctorate candidate - Duration of the mobility 19 months (01/01/ /07/2019) Settling-in allowance: 1 instalment Subsistence allowance: 19 instalments Allowance for female scholarships: 0 instalments TOTAL: 20 instalments 20 x 900 EUR = EUR to be paid in full to the scholarship holder To be encoded in EMT and in the student agreement: 19 months of duration BUT 20 instalments of subsistence allowances 21
22 Exercise 1 Male, Master candidate, Target Group 1 Duration of the mobility: 24 months (01/01/ /12/2019) Place of origin of the student: Johannesburg, South Africa Home institution: University of Cape Town, South Africa Host institution: University of Nairobi, Kenya 22
23 Calculation of EU Contribution Amount (EUR) Settling-in allowance 1 instalment 600 Subsistence allowance 24 instalments Participation costs 2 x unit cost for Master Research costs 2 x unit cost for Master Insurance costs 24 x unit cost Travel and visa costs 2 x unit cost for distance between Cape Town and Nairobi = km TOTAL
24 Exercise 2 Female, Doctorate, Target Group 2 Duration of the mobility: 36 months (01/01/ /12/2020) Place of origin of the student: Johannesburg, South Africa Home institution: University of Cape Town, South Africa Host institution: University of Nairobi, Kenya 24
25 Calculation of EU Contribution Amount (EUR) Settling-in allowance 1 instalment 900 Subsistence allowance 36 instalments Allowance for female scholarships 3 instalments Participation costs 3 x unit cost for Doctorate Research costs 3 x unit cost for Doctorate Insurance costs 36 x unit cost Travel and visa costs 2 x unit cost for distance between Johannesburg and Nairobi = 2.929,63 km TOTAL
26 Exercise 3 Female, Doctorate, Target Group 2 Duration of the mobility: 9 months (01/01/ /09/2018) Place of origin of the student: Johannesburg, South Africa Home institution: University of Cape Town, South Africa Host institution: University of Nairobi, Kenya 26
27 Calculation of EU Contribution Amount (EUR) Settling-in allowance 1 instalment 900 Subsistence allowance 9 instalments Allowance for female scholarships Participation costs Research costs no no no Insurance costs 9 x unit cost Travel and visa costs 1 x unit cost for distance between Johannesburg and Nairobi = 2.929,63 km TOTAL
28 Interruption of mobility STAFF mobility: can be interrupted and split in several periods depending on the academic / administrative needs STUDENTS mobility: can be interrupted only in duly justified and well documented cases a) For personal reasons: if student catches up on the academic activities the scholarship can be paid for the duration of the interruption if agreed by the partners if the student cannot catch up the scholarship is not paid for the duration of interruption (but mobility can be extended - respecting maximum duration allowed > split mobility) b) For academic reasons: mobility can be interrupted but the scholarship is not paid for the duration of the interruption Compulsory/institutional breaks imposed by the academic calendar are not considered interruptions 28
29 Exchange rate Why the Coordinator must open a project dedicated bank account in EURO, USD or in a currency pegged to EUR/USD? (ref. Call for proposals) To avoid (account in EURO) or limit (account in USD/local currency pegged to EURO/USD) the risk of exchange losses. 29
30 Exchange rate Article I.10 Special Provisions on the conversion of costs incurred in another currency into Euro all costs incurred on amount of 1 st pre-fin all costs incurred on amount of 2 nd pre-fin Month of reception of the 1 st pre-fin Month of reception of the 2 nd pre-fin Monthly accounting rate established by the Commission u/budget/contract s_grants/info_cont racts/inforeuro/ind ex_en.cfm all costs incurred on amount of 3 rd pre-fin Month of reception of the 3 rd pre-fin 30
31 Exchange rate Recommendations: The Coordinator should centralise as much as possible payments (in particular of allowances) if the partners' local currency is not pegged to EURO/USD. Limit transfers to other currencies as much as possible. In case partners receive transfers to pay allowances, they should preferably open a bank account in EURO if their currency is not pegged to EURO/USD. The methodology to be applied must be agreed within the partnership, stated in the MoU and information duly communicated to scholarship holders (in the student/mobility agreement) to avoid misunderstanding. 31
32 Reference documents/links - Call for proposals - Grant Agreement + Annexes - Minimum Selection requirements - Minimum Insurance requirements - Guidance on contractual project management Beneficiaries space on Intra-Africa website
33 33
34 Answers to additional questions Question 1. My project is a huge success and I would like to select more grantees than initially foreseen. As a consequence, the amount of the subsistence allowance and insurance that I need would be higher than the ones foreseen in the initial budget with EUR. However, for participation costs, research costs and for travel costs (calculated with unit costs) I have spent EUR less than planned. A. I cannot select more grantees as the subsistence allowance in the initial budget is the maximum allowed. B. I cannot select more grantees than the number indicated in the initial budget. C. I can select the grantees. As long as the total budget for implementation is respected, the amounts (calculated with unit costs) for subsistence, insurance, travel, participation and research can be lower or higher than the ones in the initial budget. 34
35 Question 2. The Master course, with a total duration of 10 months, includes a traineeship period of 2 months in the home country. A. I continue paying the scholarship during the traineeship period. B. I don't pay the scholarship for these 2 months. C. I don't pay the scholarship for these 2 months but I can claim the unit cost for travel twice. 35
36 Question 3. A Doctorate student was granted a 15 months mobility. The amount of the participation costs that I can claim for his mobility is: A EUR B EUR C EUR 36
37 Question 4. The mobility of a female Doctorate scholarship holder starts on 01/01/2017 and ends on 30/06/2018. The total of her subsistence rights (subsistence allowance, settling-in allowance and extra-allowance for females) is: A. 18 instalments of monthly subsistence allowance B. 19 instalments of monthly subsistence allowance C. 21 instalments of monthly subsistence allowance 37
38 Question 5. The mobility of a female Doctorate scholarship holder starts on 01/01/2017 and ends on 30/06/2019. The total of her subsistence rights (subsistence allowance, settling in allowance and extra-allowance for females) is: A. 32 instalments of subsistence allowance B. 33 instalments of subsistence allowance C. 34 instalments of subsistence allowance 38
39 Question 6. The real cost of the return ticket for a grantee is EUR but the unit cost for travel that I can claim for his mobility, according to the distance, is only EUR. The unit cost for insurance is 75 EUR/month but the real cost is only 70 EUR/month, for all the scholarship holders. What should I do regarding the travel ticket? A. I cancel the mobility of that student because the price of the ticket cannot be higher than the unit cost. B. I inform the grantee that I will buy him only the incoming ticket and he has to buy himself the outgoing ticket. C. I buy the ticket and I cover the difference from the insurance leftovers. 39
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