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FP6 Financial Info & FAQs --> Project --> Costs --> 7% Management Costs --> Management Costs FAQs

Q:

I am working for a British SME that is participating in two FP6 projects as an FCF partner. I would like to ask you some more information about the following statement on your website about the FCF model "It is also possible to include non-technical staff such as administrators etc., directly working on the project." Could you perhaps indicate where I could find this back in the EU regulations? Does this mean that we could for example charge the time of our financial administrators making the financial statements on the project? If so how would we do that, because in the description of work of our project this work was not foreseen in the workpackages and would not fit in any of them.

A:

Please see page 41 of the Financial Guidelines.

 

“Management of the consortium activities cover actions that can be carried out by every contractor or can be limited to only a few contractors (except for the audit certificates) include the following tasks :

“- obtaining audit certificates by each of the contractors.

- implementation of competitive calls by the consortium for the participation of new contractors, in accordance with the provisions of the contract.

- maintenance of the consortium agreement if it is obligatory

- obtaining any financial security such as bank guarantees when requested by the Commission;

- any other management activities at the consortium level not covered by any other activity, such as:

- coordination of the technical activities of the project;

- the overall legal, contractual, ethical, financial and administrative management;

- coordination of knowledge management and other innovation-related activities;

- overseeing the promotion of gender equality in the project;

- overseeing science and society issues related to the research activities conducted within the project;

-   any other management activities foreseen by the annexes.”

 

Thus if the administrators to which you refer are “normally” charged as a direct cost within your normal accounting procedures, they can be considered direct costs of the project. The funding rate may be 100% (Management rate) or 50% (RTD rate), depending on whether the 7% management ceiling has been exceeded. Again see page 41 of Financial Guidelines:

 

“The costs of these management activities are reimbursed at a rate of 100% to all contractors regardless of their cost model, up to a limit of 7% of the Community financial contribution to the project:

“The costs relating to management activities identified in Article II.2 [definitions] may be charged, up to the maximum level of Community reimbursement for management activities [7% of the Community financial contribution- see table of Article II.25]. Where the costs incurred for management activities exceed the limit of 7% of the Community financial contribution, such costs may be charged to the other relevant activity to which they correspond if they meet the conditions of Articles II.19 [eligible costs of the project], II.20 [direct costs], and II.21 [indirect costs] applicable to those activities.”

Once the limit of 7% of the Community financial contribution is reached, a management activity that is linked to another activity of the project can be charged under this activity if that activity is necessary to carry out the project. In that case, the maximum reimbursement rate of eligible costs for that activity per cost model applies.

The limitation of 7% of the Community financial contribution does not apply to each individual contractor but to the project as a whole.

 

Please also note the following quote:

 

“Finally, management of the consortium activities also cover activities carried-out by organisations specialised in project management which are allowed to participate in FP6 projects, even if they do not carry out specific RTD tasks.”

 

The fact that this Administration/financial work was not foreseen could be a problem (see quote above “any other management activities foreseen by the annexes”) but may be acceptable under above quote “the overall legal, contractual, ethical, financial and administrative Management”.

Your coordinator/PO is going to have to agree that you can include your element of financial management and that it is part of “overall ………management”



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