IMPLEMENTATION OF GRANT CONTRACTS

1

• IMPLEMENTATION OF GRANT CONTRACTS
• UNDER CARDS 2004
• PART I
• Social Service Delivery by the non- profit
  sector
• "Support to Civil Society Organizations active in
  the Field of Environment Protection and
  Sustainable Development

2
Topic

• 1.Monitoring
• 2.Visibility requirements
• 3. Final Publication
• ? Questions answers

3
Decentralised Implementation System
Central Finance and Contracting Unit (CFCU)
Succesfull applicant

• GRANT CONTRACT
• roles and responsibilities
• of each contractual side

Ex ante control Monitoring of grant scheme
Monitoring Support
Government office for co-operation with NGOs

Delegation of the European Comission
4
Decentralised Implementation System
CFCU CA (Contracting Authority) ? Signs
contract ? Carries out payments ? Monitors
implementation financial side ? Provides
guidance and supervision
DELEGATION OF EUROPEAN COMMISSION ? Performs
ex-ante control ? Provides guidance and
supervision towards CFCU
GOVERNMENT OFFICE FOR CO-OPERATION WITH NGOs
(Project Implementation Unit) ? Monitors
implementation technical side ? Provides
guidance and supervision
5
Monitoring Reporting

• Monitoring performed by
• ? 1st level monitoring- GOfNGOs
• GOfNGOs checks reports (quarterly, interim and
  final) and
• verifies them in relation to CFCU
• GOfNGOs visits all projects at least once
  during the lifetime and checks on the spot
  project mangement and financial management
• ? Final approval- CFCU
• checks financial side of reports, based on
  verification of narrative part by GOfNGOs

6
GRANT BENEFICIARY

• ? Signs contract with the CFCU
• Implements Action in the following manner
• So that results are delivered
• as specified
• Efficiently and effectively with respect to
  financial, material and human resources
• According to set rules and procedures
• ? Reports to the CA and GOfNGOs
• ? Responsible for carrying out the action and
  sound financial management (also for the
  partners part)

7
Visibility

• ? Beneficiary must publicise EU financing
• ? Visibility measures must comply with visibility
  rules see Guidelines at
• http//europa.eu.int/comm/europeaid/visibility/ind
  ex_en.htm
• ? Any project output will be promoted by
  using appropriate Communication tools as
  described in Guidelines

8

• Visibility
• EC Communication Tools

• Press releases
• Press conferences
• Leaflets and brochures
• Newsletter
• Web page

• Display panels
• Commemorative plaques
• Banners
• Vehicle panels
• Promotional items

9
Press release
Leafleat
10
Report / brochure
Newsletter
11
Studies and reports
Visibility

• ? Use report template available in the
  Visibility Guidelines
• ? Insert disclaimer"This publication has been
  produced with the financial assistance of the
  European Union. The contents of this document are
  the sole responsibility of ltname of the
  author/contractor/implementing partnergt and can
  under no circumstances be regarded as reflecting
  the position of the European Union.
• ? Issue at least one press release

12
Supplies and equipment
Visibility

• ? Any supplies or equipment must visibly carry
  the EU logo and the mention Provided with the
  support of the EU in English and in Croatian.
• ? Issue at least one press release

• Infrastructure
• Use display panels commemorative plaques in
  accordance with EC Visibility guidelines to
  publicize any infrastructure works (roads,
  bridges, building, houses, etc.)
• ? Issue at least one press release

13
Events
Visibility

• ? Those attending EU-funded training courses,
  conferences, seminars, fairs, exhibitions and
  workshops must be made aware that the EU is
  financing the event
• ? Invite CFCU and GOfNGOs
• ? Use EU logo on any documents
• ? Display EU flags and/or banners
• ? Use display panels
• ? Issue at least one press release

14
FINAL PUBLICATION

• Introduction About the Programme
• List of all co-financed projects
• Basic information of the Beneficiary (Address,
  Phone, Fax, e-mail, Project Leader, Project
  Value, Total Project Costs, Amount of Grant, own
  contribution, Website)

• Partners
• Purpose,
• Objectives,
• Problem issues
• Target Groups
• Results and added value
• Impact of the partnership
• Cross border impact (if applicable)
• Sustainability

15

• THANK YOU FOR YOUR ATTENTION
• Contact

CARDS2004.pitanja_at_uzuvrh.hr
16

• Workshop for Successful Applicants
• PART II
• Grant Schemes CARDS 2004 Social Service
  Delivery by the Non-Profit Sector and
• CARDS 2004 Support to Civil Society
  Organisations active in the Field of Environment
  Protection and Sustainable Development
• July 2007

17
Project implementation and narrative reporting

• Principles for successful project implementation
• Reporting on project implementation
• Narrative reports
• Amending contracts
• QA

18
1. PRINCIPLES FOR SUCCESSFUL PROJECT
IMPLEMENTATION

• Time management
• Human resource management
• Communication
• Quality control and quality assurance
• Risk management
• Financial management
• USE THE AVAILABLE ASSISTANCE Monitoring Experts
  and GOfNGOs

19
1. Principles for successful project
implementation Time management (1)

• Meeting project schedule gives a good chance of
  staying within their project budget
• Frequent problems encountered
• Lack of resources (time, people) to complete
  the tasks sequentially
• Overlapped tasks - several happen at the same
  time
• Recomendations
• Identify the tasks with some flexibility from
  those with zero flexibility concerning the start
  and finish date
• The Project Manager's key time management task is
  to manage those without flexibility.

20
1. Principles for successful project
implementation Time management (2)

• Also
• Use an activity tracker, based on the activity
  planner, which supports the report
• Use a finance tracker, based on the finance
  planner, which supports the report
• Use an objective tracker - for use at project
  reports

21
1. Principles for successful project
implementation Human resource management

• Managing the people resources means
• Having the right people, with the right skills
  and the proper tools, in the right quantity at
  the right time.
• For the project purpose
• Hold at least once at week regular narrower
  project team meeting (project manager, assistant,
  activity leaders, book keeper)
• Ensure that they know what needs to be done,
  when, and how.
• Motivate them to take ownership in the project
  too.
• Keep personnel time sheet tracking (working
  hours, travels)
• Hold at least once at month meeting with partners
  (subcontractors, collaborators, stakeholders)
• Maintain good communication

22
1. Principles for successful project
implementation Communication

• Within the organization - clear
  responsibilities, decision making process and
  established communication channels are important
  for successful project implementation
• Among the partners and partner organizations
• Possible problems in partnership cooperation
• Different opinions
• Only declarative participation
• Partnership as a way of realization own goals
• To avoid misunderstandings use all means of
  communication
• Telephone, fax , mail Formal and informal
  meetings Common documentation exchange /
  creation Common appearance in media Common
  visiting beneficiaries

23
1. Principles for successful project
implementationQuality control (1)

• Each project has to fulfill specific quality
  task.
• The most important elements of that task are
• Quality assurance
• Refers to the process used to create the
  deliverables
• Project auditors can perform a quality assurance
  review on your project
• Quality control
• Used to verify that deliverables are of
  acceptable quality and that they are complete and
  correct
• Refers to project indicators
• Can be tested through the evaluation

24
1. Principles for successful project
implementation Quality control (2)

• Evaluation
• External and Internal
• Internal measure
• Quantity
• Activities comparing with plan from contracting
  document and expressed in (obligatory in
  quarterly report)
• Number of beneficiaries - (standard
  documentation as statistics, list of
  participants, number of web site visitors,
  registration forms)
• Quality
• Evaluation forms, beneficiaries feed back, press
  clipping

25
1. Principles for successful project
implementation Risk management (1)

• Risks could be defined on two ways
• Cause of the situation
• 1.1. External
• Project assumptions are not accomplished
• Influence of not included solution strategies
• Money problems
• 1.2. Internal
• Staff changes
• Low service quality
• Lack of volunteers
• Consequence
• Budget will be exceeded
• Goals not achieved
• Time limits will be

26
1. Principles for successful project
implementation Risk management (2)

• Four things for risk response
• Avoid the risk. Do something to remove it. Use
  another contractor or collaborator for example.
• Transfer the risk. Perhaps a partner can be made
  responsible for a particularly risky part of the
  project.
• Diminish the risk. Take actions to reduce the
  impact or chance of the risk occurring. If you
  need to add or change some activities for
  example, you can start the procedure for set up
  the contract addendum (only if really necessary)
  
• Accept the risk. The risk might be so small the
  effort to do anything is not worth while.

27
1. Principles for successful project
implementation Financial management

• In this case covers the policies and practices
  regarding accounting, reporting, auditing,
  organizational management and personnel of a
  project
• Important
• Strictly respect all book-keeping rules and low
  in force
• Have separate expenditure tables form other
  donors
• Manage with care and keep well all documentation
  as bills, treasury book, payment and pay-in
  receipts, authoring and work contracts, belonging
  calculations all will be the subjects of
  control (Art.16 GC)
• Use attached templates as
• Time sheet
• Project participants payment review
• Statement of expenditure on actual work
• Information on procurement
• Mid term / Final progress report
• Traveling expenses form

28
Reporting on project implementationReports

• Quarterly, Interim, Final Report
• Narrative and financial section
• Cover action as a whole, regardless of which part
  is financed by EC
• In English signed by person responsible for
  project
• No need to attach bills and receipts. They will
  be subject of on the spot control
• Approved if no written reply within 45 days
• CFCU any time may request additional information
  to be supplied within 30 days

29
2. Reporting on project implementation
Narrative Reports

• The Report must be completed and signed by the
  Contract person
• The information must correspond to the financial
  information that appears in the Financial Report
• The Contracting Authority will reject any
  incomplete or badly completed reports
• The answer to all questions must cover the
  reporting period.
• Names of actions and activities (nomenclature)
  should be consistent with those in project
  contract.

30
Reporting on project implementation Quarterly
Reports

• Every three months
• Deadline in 30 days after exceeding the period
• Only narrative (with indication of amount spent)
• Short description of activities undertaken and
  planned
• Presentation of changes in budget headings
• Send by e-mail to
• GOfNGOs info_at_uzuvrh.hr
• DEK (rima.joujou_at_ec.europa.eu )
• CFCU (ivan.serdarusic_at_mfin.hr )

• After applied corrections, to return by e-mail

31
2. Reporting on project implementation Interim
Report

• After 12 months or unless other specified (Art.
  4.1. SC)
• Deadline 30 days after exceeding the period
• Narrative and financial section
• Shall include a work-plan for the next phase of
  the Actions implementation
• Must accompany every request for payment
• It has to be approved.
• Send by e-mail to
• GOfNGOs info_at_uzuvrh.hr
• DEK (rima.joujou_at_ec.europa.eu )
• CFCU (ivan.serdarusic_at_mfin.hr ) hard copy
• After applied corrections, send again by e-mail
  and signed hard copy by post to CFCU

32
2. Reporting on project implementation Final
Report

• No later than 3 months after the implementation
  period
• Narrative and financial section
• Annex with proof of transfer of ownership
• Audit report - attached to Final report (and
  request for payment of balance), if grant gt
  100.000
• To be sent
• GOfNGOs info_at_uzuvrh.hr
• DEK (rima.joujou_at_ec.europa.eu )
• CFCU (ivan.serdarusic_at_mfin.hr ) hard copy
• After applied corrections, send again by e-mail
  and signed hard copy by post to CFCU

33
2. Reporting on project implementation Audit
Report

• Attached to Final report (and request for payment
  of balance), if grant gt 100.000
• By approved auditor a member of an
  internationally recognized supervisory body for
  statutory auditing (or a member of Croatian Audit
  Chamber)
• Auditor examines whether declared costs are real,
  exact and eligible

34
Amending contracts

• Any change to Action/budget must be set out in
  writing in a Addendum to the contract (PRAG E10)
• Request to CFCU at least 1 month before it will
  enter into force, preferably 2 months before
• Request must be substantially justified!
• Maximum grant amount cannot be increased
• Request cannot cause change of initial
  competition conditions
• Addendum has to be signed by both parties and
  endorsed by ECD before entry into force

35
Amending contracts

• No retroactive modifications!
• Reallocation between Administrative costs and
  other budget headings not allowed
• Addendum not necessary if
• Basic purpose of the Action not affected
• Financial impact is transfer within same main
  budget heading or between main budget headings
  involving variation of lt15 of the original
  amount of the heading
• Still prior consultation with CFCU via e mail!

36
THANK YOU FOR YOUR ATTENTION!

• questions, GOfNGOs
• CARDS2004.pitanja_at_uzuvrh.hr

37
PART IIIProject implementation

• Financial Provisions
• Financial Reporting
• VAT exemption
• Procurement by Grant beneficiaries (Annex IV of
  the Contract)
• ? Questions answers

38
I. Financial provisions - Payment procedure

• OPTION 1. Actions with an implementation
  project lt 12 months
• Project Start Pre-financing 80 of budget
  within 45 days of receipt by CFCU of
• Signed contract by both parties
• Request for payment (Contract Annex V)
• Project End the balance (20) within 45 days of
  CFCU approving the final report
• Final Report
• Request for payment (Contract Annex V)

• OPTION 2. Actions with an implementation period
  gt 12 months
• Project Start Pre-financing 80 of budget
  within 45 days of receipt by CFCU of
• Signed contract by both parties
• Request for payment (Annex V)
• End of Year 1 - Further pre-financing 12-months
  budget within 45 days of receipt by CFCU of
• Interim Report
• Request for payment (Annex V
• Project End the balance (20) within 45 days of
  CFCU approving the final report
• Final Report
• Request for payment (Contract Annex V)

39
Financial provisions

• Further pre-financing only if 70 of previous
  payment has been spent!!!
• If request inadmissible (no supporting docs,
  amount not due..), CFCU may suspend 45-days time
  limit
• In case of late payments beneficiary can claim
  interest
• Payments made to separate bank account

40
Financial provisions

• Payments made in HRK to Croatian entities/ in EUR
  to foreign entities
• Interests on pre-financing mentioned in reports
  and refunded!
• In case of late refund CFCU can claim interest!

41
Financial provisions - Accounting and Financial
Management

• REMINDER - Eligible costs are
• Necessary (connected to activity!)
• Stipulated in the Budget
• Cost-effective
• Recorded in accounts, identifiable, verifiable
  and backed by originals

42
Financial provisions Accounting

• According to Croatian accounting rules and
  Practical Guid to Contract Procedures for EC
  External Actions (PRAG), but double-entry book
  keeping, either as part of regular system or as
  separate system!!!
• Beneficiary as well as partners!!!
• Clear and easy reconciliation between activity ?
  original supporting documents ? accounts ?
  financial reports
• Refer to the recommendations
• in the Financial Management part

43
VAT (PDV) exemption

• CARDS grant contracts are exempt from Value Added
  Tax (VAT) and customs charges
• VAT is not eligible cost, unless the Beneficiary
  (or, where applicable, his partners) cannot
  reclaim it and the applicable regulations
  authorise coverage of taxes
• Grant beneficiaries must obtain VAT customs
  exemption certificate from CFCU, based on the
  pro-forma invoice of the subcontractor WITHOUT
  VAT and custom charges
• The beneficiary sends the VAT exemption form (3
  originals) with the Pro-forma invoice (VAT 0)
  to CFCU
• Make a reference to Budget item that the cost
  relates to!!

44
II. Financial Reporting

• Forecast budget and follow-up
• Interim Financial Report
• Final Financial Report
• Supporting forms

45
Forecast budget and follow-up

• CFCU in contract, for information purposes
  only it allows the follow-up by operational and
  financial services.
• It concerns forecasts and also allows to observe
  adaptation capacity in revising forecasts and
  their implementation.

46
(No Transcript)
47
Interim/Final Financial Report

• Expenses for each currency in which the budget
  has been implemented during the specific
  reporting period (including the where the
  exchange Fx rate into will be 1 ) the report
  will
• establish the exchange rates (local currency gt
  ) to be used by having, for the period, the
  simple arithmetical average of the InforEuro
  exchange rate
• InforEuro is freely available at
  http//europa.eu.int/comm/budget/inforeuro/index.c
  fm?languageen

48
(No Transcript)
49
(No Transcript)
50
Supporting Forms

• INVOICES BY BUDGET HEADING
• Support for monitoring of expenses by budget
  headings in align with the project budget and
  interim/final financial report
• Excel file on the CD ROM

51
III. Rules and procedures related to procurement
Annex 4

• Whenever acquiring goods, services or works,
  grant beneficiary must apply EU procurement rules
• Rules in Practical Guide to Contract Procedures
  for EC External Actions (PRAG), revised 2006
  edition
• EuropeAid web page http//europa.eu.int/comm/euro
  peaid/tender/gestion/index_en.htm

52
Procurement

• General rules
• Nationality rule procurement is open on equal
  terms to all legal persons from EU CARDS
  countries
• Rule of Origin goods tendered for the project
  has to originate from EU or CARDS countries
  (supplier has to provide Certificate of Origin to
  beneficiary)
• Eligibility legal persons not entitled to
  tender if bankrupt, convicted, involved in
  fraud, etc. 2.3.3. PRAG
• Tenderer has to provide sworn statement (during
  procedure) and official document (if awarded a
  contract)

53
Procurement

• General rules
• Conflict of interest anybody involved in project
  preparation cannot bid
• Period for bidding leave enough time to ensure
  competition
• Awarding principles transparency, equal
  treatment, non-discrimination
• Non-retroactivity no retroactive awards
• Record keeping full tender documentation to be
  kept for 7 years after the payment of balance

54
Types of procedure
? Depends on the subject of procurement
Technical assistance, preparation of projects,
studies, analysis, evaluations, transfer of
know-how, etc.
SERVICES
Public procurement(EC rules)
Material, equipment, tools machines, etc.
SUPPLIES
Execution of works (construction reconstruction)
WORKS
55
? And on the value of the goods
SERVICES
SUPPLIES
WORKS
56
SINGLE TENDER (lt 5.000 EUR)

• ? Draft a request for services, supplies or
  works
• ? Send a request to sufficient number of firms
  in order to get at least 1 compliant offer
• ? Negotiate with the firm offering the most
  economically advantageous offer
• ? Sign contract

57
NEGOTIATED PROCEDURE (services 5000-200.000 EUR,
supplies5000-30 000 EUR, works 5000-300.000
EUR)

• ? Prepare documentation (tender dossier)
• ? Draw a list of firms to be contacted
• ? Send the invitation accompanied with tender
  dossier to at least 3 candidates and set a date
  for submission
• ? Establish the Evaluation Committee
• ? Evaluate offers (at least 3 compliant offers!)
  according to criteria agreed beforehand and
  select economically most advantageous one
• ? Draft the Evaluation report
• ? Sign the contract

58

• ? Local / international
• ? Open/ restricted
• ? Publish the tender and its corresponding
  documents in the appropriate media (daily press
  and/or Official Gazette)
• ? Corresponding documents Tender Dossier
• Terms of reference
• Technical specifications
• Bills of quantity
• ? Evaluation Committee
• ? Contract signature

59

• The Beneficiary is not allowed to artificially
  split the amount to be tendered in order to
  simplify/circumvent the obligatory tendering
  procedure !!!