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FP6 Financial Info & FAQs --> Proposal --> Cost Models --> Additional Cost Model (AC) --> AC FAQs

Q:

How can we charge Staff costs if we use the AC cost model?

A:

We recieve many variants of this question from contractors using the AC model.

 

Please refer to page 45 of the financial guidelines where there is reference to the problem of using  staff in universities etc. 

 

To summarise the situation:

 

1. General permanent staff (whether they are lecturers, professors, scientists, machine tool operators, technicians etc) who receive their salary under employment contracts and the costs are funded from the core activities of the institution can not be considered additional costs and  their salaries etc are not eligible costs (although there travel costs etc for the project would normally be classified as eligible costs - so long as they are really working on the project)

 

2. Where the employment of the staff (again whether  they  are lecturers, professors, scientists, machine tool operators, technicians etc) is dependent entirely, or in part, upon outside funding (e.g. EU grants, specific donations etc) and their employment will automatically cease if these outside funds are not forthcoming, or the time they work and the salary costs will be reduced in accordance with the amounts not received from non-core sources, the salary costs (including employer's costs and social benefits etc) are eligible costs to be included in the cost statements.The 20% overhead under AC will apply to these costs.

 

3. In addition where permanent staff are employed in the management of the project, their salary costs can be charged to the project (without the addition of 20% overheads) but subject to the usual overall restriction of this not exceeding 7% of the total project funding for all partners. (For FC and FCF cost models the contractor may be able to  recover excess management costs as R&D with 50% funding, but we don't think the project officer will allow AC contractors to shift the management costs for staff to R&D, since this goes against the "spirit" of the concession).

 

As usual wherever personnel costs (salaries and benefits etc) are charged to EU they must be evidenced by:

 

1. Signed timesheets in the appropriate form (in our view showing the amount of time spent on the project and the amount of time worked generally each day and the total for the  month should be recorded)

 

2. Recording the expense in the contractor's books of account and in its annual accounts. It should be noted that normally  only actual amounts paid will be allowed and provisions made for pensions, holidays, sickness  and other funds within the books of account of the contractor are not eligible costs unless paid to a third party. In our view  accruing salaries due each month, and paid with a couple of weeks of the start of the next month, are within the definition of "incurred expense" and can be included in the cost statements.



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