Financial guidelines and reports - VLIR-UOS

Report
FINANCIAL GUIDELINES AND
REPORTS
South Initiatives and TEAM
(TEAM only for DRC in this info session)
25 June 2014
Content
1.
2.
3.
4.
5.
6.
Introduction
General provisions
Reports: activity and financial report
Budget lines
Financial reporting model
Budget changes
1. Introduction
• 2nd Call for projects within Country
Strategies (2013, 2014)
TEAM DRC
Duration
Budget
Max. 4 years
Max. 250.000 EUR
South Initiative
Max. 2 years
(Cuba, DR Congo,
Ecuador,
Tanzania,
Uganda, Vietnam,
South Africa and
Ethiopia)
Max. 75.000 EUR
3
2. General provisions
• How to start…
• Signed contracts, “starting date” …
• Opening of a bank account in partner country
– Link SI : no account – no local coordination cost
– For Cuba : start very quickly to establish the terms of
references with MINCEX
– preparing a North-South budget
• Financial agreements between partners
4
• Contract (tripartite agreement)
• Agreement between 3 stakeholders in the
project:
1. VLIR-UOS
2. Flemish Higher Education partner
3. Partner university
• Contract contains basic information and mutual
obligations of the three parties involved
5
• North-South budget
• The budget contains funds for spending in
Belgium and in partner country
• A proposal for division is made, based on the
activities and discussion between the partners:
what to spend where?
• This North-South division can always be
changed
• Based on the division, a money transfer can be
organized as soon as possible…
6
• Opening bank account in partner
country
• Separate account for the project:
– At a well-known, trustworthy bank
– Never on a person’s name, but with the university as
account holder
• Mandate holders of the account:
– At least two persons have to sign for a withdrawal
– They have to be able to represent the university
• Currency? USD, EUR, local currency?
7
Budget transfer from Belgium to partner country
• 4 transfers per activity year from VLIR-UOS to
the Flemish partner (UGent; KU Leuven:
debitnote)
• Transfers always conditionned by receipt of
funding from DGD.
S = 25%
Year 1
Year 2
Year 3
Year 4
Year 5
S1
< 4 w after sign.
Contract : S1
Apr :
25%
Reports Reports
Y1? Apr Y2? Apr
Reports
Y3? Apr.
S2
< 4 w after sign.
Contract :S 2
July
July
July
July
S3
Okt. N
Okt.
Okt.
Okt.
Okt.
S4
Jan. N+1
Jan.
Jan.
Jan.
Jan.
8
Budget transfer from Belgium to partner
country
• Own policy of the Flemish partner to transfer
money to the South.
 Good practice : work with cash call (planned
activities and budget needed; copies of
justifications of previous cash calls sent? Copy of
bank statement to show there is an insufficiency of
funds and matches provisionary report
expenditures?)
 Good practice : cash call : T3 if 80% of T1 has
been justified; T4 if missing 20% of T1 is justified
and 80% of T2, etc…
 Good practice : never transfer large sums in 1 time
(risk of bank failure, exchange rate risk,…)
 Good practice : never wire money before KB is
signed, wait for tripartite agreement to be signed
9
Budget transfer from Belgium to partner
country (contd.)
• When money arrives, bank statement will
indicate exchange rate
 In principle, all transfers can be considered
“advances”, and before the next one comes you
should be able to demonstrate the last one has been
(largely) spent
 Good practice : send statement to partner in the North
because it will be used to calculate exchange rate
10
• Budget management
• Clear procedures:
– Who approves expenses?
– Who makes the payments and who controls them?
– Is it clear that personnel costs and other allowances
cannot be changed without agreement with three
partners?
– Control: keeping track of advances, reconciling
bank/cash, honor declaration (exceptional + approved
by responsible)
 Accounting and reporting
• Have the E2 also correctly registered.
11
• How to spend the money? (important)
• For every expense we need a correct
justification
– Clearly numbered and classified
– The originals are kept in the partner country, the
scans/pdfs are sent to Belgium
12
• How to spend the money? (important)
• What is a correct justification piece?
– For every purchase of a good or service there has to
–
–
–
–
–
be a “tax invoice” from the provider
For per diems: a signed proof of receipt (no sitting
allowances!)
For workshops: a list of attendants, signed by each +
invoice from supplier (refreshments, food, …)
Never accept pro forma invoices as justification
Payments to persons: only on the basis of signed
service contract or employment contract
Are the invoices addressed to the university and not
to a person?
13
• How to spend the money? (important)
• Purchases in partner country
– Purchases over 8,500 EUR need at least 3 pro forma
invoices for VLIR-UOS
– What about the own university procurement
procedures?
• Imported goods in partner country
– Custom duties or any other taxes are to be paid by
the partner university from its own resources (if no
exemption is granted)
• When goods are purchased, they have to be
registered and marked (VLIR-UOS stickers) and
put on an inventory list
14
Starting date of the project
•
Please let VLIR-UOS know the date of your first
expenditure. That date will be the starting date
of your activity year.
•
The first expenditure needs to be before
31/12/2014
15
Knowledge sharing and
procedures
• Plan an information session with
Southern partner
•
•
•
Funding : Cash call
Deviations from budget : clear procedure
Justifications :
•
•
•
Reporting : details in the reports
»
»
•
formal aspects
Follow up
E.g per diem 20 EUR*5 days from 20 July till 24 July +
accommodation cost 32 * 4 for X : survey field work
E.g. airline ticket econ. Class from Vietnam to Belgium dd 20/04 –
27/4 for Prof X
Deadlines : internal and towards VLIR-UOS
16
3. Reports
• Activity reporting (AAR) and financial
reporting (AFR)
•
•
•
•
Yearly, and continuously!
Final report at the end of the project
Following VLIR-UOS formats (see website)
Timing:
–
–
for projects with a starting date before 30/06/13: at
the latest 31/08/14
for projects with a starting date between 01/07/13
and 31/12/13: at the latest 28/02/15
 Internal deadlines within the university?
17
• Annual Activity Report (AAR)
1. Basic information
2. Overview of the realized activities
3. Comparison between what was planned and the actual
4.
5.
6.
7.
accomplishment
Comments on the performance of the project
Justification of the differences between the budget and the
expenditures
Perspectives for next year(s)
“Soft indicators” = information concerning:
•
Attitudes on decision making, conflict resolution, articulation of ideas,
conceptual and strategic thinking etc.
8. List containing:
•
•
•
•
Purchased materials (investments)
Staff (personnel) involved in the project
Scholars (name, type of scholarship, time period, topic, guest
institution)
Overview international mobility
9. Optional: pictures, interviews, anecdotes, scientific material, press
articles, etc.
18
• Annual Financial Report (AFR)
• Basically a list of expenses
• Format in excel from VLIR-UOS
• Made up of different sheets
1. Model IA: basic information
2. Model IB: overview of expenses per budget line
3. Model IC: details of the expenses made from the
Belgian account
4. Model ID: details of the expenses made from the
local account
5. Model IIB: cash and bank registers
6. Exchange rate calculation: weighted average
exchange rate based on money transfers from
Belgium to partner country
19
• Control procedure
In response to the reports VLIR-UOS will send
comments and questions
 Opportunity to reply and adapt
 Careful with the risk of refused expenses!
 When expenses are refused they have to be paid for
by other means, ideally the E2. Coordination costs (=
lump sum)
 At the end of a project year there will be a comparison
between the accepted expenses and the transfers
that have been made
20
Control procedure
Deadlines : 1 submission date of AR (see contract), 1 control report from
VLIR-UOS, 1 formal adapted report with provided answers and copies of
requested information and within a limited time frame (1 month or
alternative date if this is requested before 1 week after control report).
Risk of refusal of expenditures.
Warning : Often late or incomplete submission of south report and
justifications lead to considerable delays and considerable risk for future
refusal of expenditures.
Good financial practice :
- discuss this risk with your partner and have these deadlines
respected
- keep copies of justifications and tender documents in Belgium
- cash calls
- use control checklist before submitting the report to VLIR-UOS
21
4. Budget lines
A. Investment costs
B. Operational costs
C. Personnel costs
D. Scholarship costs
E. Coordination costs
→ See project proposal, annex ‘budget proposal’
22
Budget lines
TOTAL (EUR)
A. Investment costs (max. 25% of the total budget)
0
A.2. Equipment
0
A.4. Office furniture
0
A.5. Others
0
B. Operational costs
0
B.1. Preparation costs
0
B.2. Maintenance of equipment
0
B.3. Consumer goods
0
B.4. Communication
0
B.5. Representation costs (max. 500 EUR per year)
0
B.6. Travel costs in Belgium and locally
0
B.7. Congress registrations
0
B.8. Local per diem
0
B.9. International travel costs
0
B.10. International overnight expenses
0
B.11. Shipment costs
0
B.12. Others
0
C. Personnel costs (max. 25% of the total budget)
0
C.1. Service contracts
0
C.2. Topping-up
0
C.3. Employment contracts
0
D. Scholarship costs
0
D.1. Short term funding in Belgium
0
D.2. Study scholarships (e.g. Master) in Belgium
0
D.4. Study scholarships (e.g. Master) in partner country
0
Subtotal A-D
0
E. Coordination Costs
0
E.1. In Belgium (lump sum 5% of the A-D total)
0
E.2. Local coordination costs (lump sum 5% of the A-D total)*
0
TOTAL
0
23
A. Investment costs
 Durable goods (> 125 EUR) with long use
 Should be registered and handed over to the
partner university at the end of the project
• A.1. Buildings
•
New physical infrastructure and renovation of
existing infrastructure is not possible
• A.2. Equipment
• A.3. Vehicles
•
No vehicles in South Initiatives
• A.4. Office furniture
• A.5. Other
24
B. Operational costs
 project related costs, directly linked to activities
leading to a previously defined IR (intermediate
result)
 ↔ coordination costs for general management of
the project
e.g.:
• costs related to the organization of a workshop,
• consumer goods,
• field trip transport,
• publications,
• software licenses,
• travel costs ….
25
B. Operational costs: detailed lines
• B.1. Preparation costs
•
•
•
Preparatory activities, e.g. fact-finding mission
by Flemish promoter to partner country
Between date of approval by Belgian Minister
and starting date of the project
max 2,500 EUR
• B.2. Maintenance of equipment
•
An amount to anticipate necessary
maintenance
• B.3. Consumer goods
•
•
Consumables necessary for the achievement of
project results
E.g. small lab material, chemicals, books,
replacement pieces, office supplies, fuel, ….
26
B. Operational costs: detailed lines
• B.4. Communication
• Telephone, internet, fax, invitations,
brochures,…
• Always based on invoices, no lump sums
• B.5. Representation
• Max. 500 EUR per project year
• Diners, receptions, small gifts, ….
• Has it been budgeted?
27
B. Operational costs: detailed lines
• B.6. Travel costs in Belgium and partner country
 Always based on invoices, no lump sums
 Careful: when using local transport within the same city
during a (international) visit the per diem is supposed to
cover the costs
 In Belgium
•
•
Public transport (train, bus)
Taxi: only with justification, in exceptional cases
•
Car: fixed kilometer allowance
 In partner country
–
–
•
•
If necessary rental car
Train, boat, bus, metro or other means of transport
–
•
no higher than Belgian kilometer allowance (0,3461 EUR/km)
» Updates on VLIR-UOS website
the allowance covers costs for fuel, driver, insurance, etc.
Reimbursement of the ticket
Plane: local economy flight
28
B. Operational costs: detailed lines
• B.7. Congress registrations
• When there is an active participation
(poster, paper)
• B.8. Local per diem
• = Lump sum compensation to cover travel
•
•
•
•
related expenses (transport within city,
meals, communication, etc.)
≠ Salary or service contract
Only when travelling to another city
= Based on the local scales : maximum 20
EUR/day
Costs of hotel covered separately based on
invoices with a proposed maximum of 50
EUR/night (DRC: max 100 EUR/night)
29
• For local missions in RD Congo:
1 . Follow budget
2. Or follow country strategy agreements
per diem local in EUR
Bukavu
Max 34
Goma
Max 37
Kinshasa
Max 52
Kisangani
Max 32
Lubumbashi
Max 55
Autres endroits
Max 23
B. Operational costs: detailed lines
• B.9. International travel costs
•
•
•
•
Travel costs for international visitors, NOT for
scholarships
Based on invoices
Plane ticket: economy class, airport taxes, handling
fees
Other costs:
–
–
–
–
–
–
transport to and from the airport
visa (careful! visa for Belgium is free!)
passport
passport pictures
costs for certificates
insurances
31
B. Operational costs: detailed lines
• B.10. International overnight expenses
•
•
•
Residential costs for visitors, NOT for
scholarships
Visit can take a max. of 21 days
International per diem
–
–
–
•
= lump sum allowance calculated on the nights spent
in the country
List of per diem amounts per country (changes
frequently!)
Per diem includes local transport, food, drinks,
personal expenses, communication,…
Hotel costs
–
–
–
Based on invoice
“indicative maximums” per country
NOT for: meals, room service, internet, telephone,
etc.
32
B. Operational costs: detailed lines
• B.11. Shipment costs
• Shipment of investment and consumer
goods to partner country
• Packing, transport and insurance costs
• Local costs such as stocking, security,
handling, local transport, ….
• NOT: import taxes!
To be charged to the partner country who
needs to undertake steps with relevant
authorities to waiver these taxes
• B.12. Other
33
C. Personnel costs
• C.1. Service contracts
• C.2. Topping-up
• C.3. Employment contracts
 max. 25% of total project budget
 Changes to the personnel budget always have
to be approved by VLIR-UOS
 Performance based
 Belgian academic personnel must be made
available by the Flemish institution
 Guest lecturers and visitings: no fee except
reimbursement of travel and accommodation
costs (incl. per diem) – no teaching allowances
34
C. Personnel costs: detailed lines
• C.1. Service contracts (max 25% of personnel budget)
•
•
•
External forces for a very specific task
Local scales
Drawing up a contract
•
Supplement to the salary of university staff involved
in the project
Max. 40% of gross salary and max 25% of project
budget
Justification: salary slip
• C.2. Topping-up
•
•
• C.3. Employment contracts
•
•
•
(Temporary) university personnel paid by the project
Academic (researchers, etc.) , administrative
(secretary, etc.), technical (driver, etc.)
University salary scales
35
D. Scholarship costs
• In Belgium:
•
•
•
Short term allowance (study/research stay – max. 6
months)
Master scholarship (study scholarship – max. 2
years)
PhD scholarship - only TEAM
» Sandwich formula (1/3 Belgium, 2/3 partner
country); deviations must be requested to and
approved by VLIR-UOS, in any case max. 24
months Belgium and max. 4 academic years
• Transport costs scholars (NOT on B.9)
 Scholarships are supposed to aim at capacity
building for partner institution
 Detailed guidelines (incl. amounts) on VLIR-UOS
website, updated regularly
36
D. Scholarship costs
• Points of attention:
 Correct amounts, without mixing up different







guidelines
Transparency of calculation in financial report
No double accounting of lump sums (e.g. indirect
travel costs)
No extras on top of the lump sums
Visa to Belgium are always free
Costs may not go beyond the project duration
Accommodation: keep justification pieces, no
accounting of guarantees/cautions
Participating in a congress :
 for PhD : no payment of per diem since the scholarship

continues to be paid ; hotel payment from the research
allowance
For MsC: extra hotel reimbursement
37
D. Scholarship costs
• Transport costs:
•
International plane ticket in economy class + travel
insurance (so, not under B.9.)
•
Indirect travel costs (visa = free)
– Medical expenses for obtaining a doctor’s certificate (including
–
–
•
If it is necessary to make a long trip (e.g. to the capital) to
obtain the visa
–
–
–
•
costs for obligatory vaccinations and necessary medicines);
Legalisation of documents (e.g. photos);
Transportation to and from the Embassy and/or airport in the home
country and Belgium
Most economical national or international itinerary (airplane or
bus, 1 economy ticket)
A per diem of € 20 per day (DRC: 52 EUR/night)
Accommodation costs up to a maximum of € 50 per night for up to
10 days if a stay is required by the Embassy (DRC: max 100
EUR/night; upon receipt of hotel invoice)
No travel costs in Belgium are reimbursed for scholarships
(↔ visits)
38
E. Coordination costs
• E.1. Coordination costs in Belgium
•
Lump sum: 5% of the A-D total
•
•
Lump sum: 5% of the A-D total
Only if a local project account has been opened for
management of local funds
• E.2. Coordination costs in partner country
 ! Before 2013: 5% of actual expenditure (A-D)!
 ! From 2013: 5% of the approved budget (A-D)!
 Costs related to the administration and coordination of the
project
e.g. mailing, telephone, rental for offices, bank costs, …

Exception : Banking costs have been accepted for RD Congo
under B. Operational cost since banks are extremely costly.
 Save part of it as a reserve in case expenses are refused by

VLIR-UOS!
To be accounted for, but not reported to VLIR-UOS…
39
5. Financial reporting model
•
•
•
•
AFR = Annual Financial Report
Basically a list of expenses
Format in excel from VLIR-UOS (see website)
Made up of different sheets
1. Model IA: basic information
2. Model IB: overview of expenses per budget line
3. Model IC: details of the expenses made from the Belgian
account
4. Model ID: details of the expenses made from the partner
country account
5. Model IIB: cash and bank registers
6. Exchange rate calculation: weighted average exchange
rate based on money transfers from Belgium to partner
country
40
AFR: Model 1A
AFR: Model 1A
41
AFR: Model 1B
AFR: Model 1A
42
AFR: Model 1C
AFR: Model 1A
43
AFR: Model 1D
44
AFR: Model 2B
• Bank and cash registers
 Based on real bank and cash registers
 Separate Model 2B for every currency used
 Can be replaced by the use of bank statements
45
AFR: Rate
46
AFR: Exchange rate
• Three ways to calculate exchange rate:
1. Based on the transfers from Belgium: an average
rate will be calculated automatically for the entire
year
2. Exchange rate per transfer
3. Exchange rate per expense: keeping all proof!
47
AFR: rate method 1 = yearly average
• Working year 1: per transfer
•
•
•
Gross the amount leaving the Belgian account
in EUR
Net the amount arriving on the local account in
the target currency
Yearly average exchange rate: (Σ a) / (Σ b)
 Bank charges of the transfers should be calculated
within this exchange rate calculation
• Working year 2 and the next:
•
•
Same method
But the local balance (rest) of the previous year
should be included in the rate calculation,
using, the yearly average of that previous year
48
AFR: rate method 2 = per transfer
• Use the rate indicated by transfer for that
amount, until the amount is finished
• Next rate with money from next transfer
• In model 1D overwrite existing formulas with
the correct exchange rates for every used
amount
49
AFR: rate method 3 = daily rate
• Can be used
• Justification piece required for every
expense
• In model 1D overwrite existing formulas with
the correct exchange rate for every expense
• Time-consuming, and not recommended by
VLIR-UOS
• Possible through www.oanda.com
50
AFR: Work flow
51
AFR: Points of attention before
submitting
• SEE CHECKLIST ON WEBSITE
• Respecting the financial guidelines
• Only the division in budget lines A to E is relevant
•
•
•
•
•
for reporting (so no B.9, C.2 etc.)
Listing all expenses individually in Model IC of ID
All invoice dates should fall within the spending
period of the project year
Listing the expenses in the currency in which they
have been paid, with calculation to EUR and
exchange rate justification when needed
Transfer costs are part of the exchange rate
calculation (so no separate accounting)
Extra costs on hotel bill (apart from room cost) are
to be paid with per diem
52
AFR: Points of attention before
submitting
• Detailed description:
 e.g.: per diem: country, amount per day, dates
 Plane ticket: trajectory, dates, passenger
 Workshop: theme, amount of participants, meal,…
(special attention for those countries of which
justifications are in a language we donot understand –
Vietnam, Ethiopia,…)
• No import taxes
• Keep copies of justification pieces (invoices or
receipts) for all local expenses at the Flemish
partner
• No advances or commitments in the AFR
• Coordination costs reported as a lump sum,
accounted separately
53
6. Budget changes
• Budget shift: shift in the budget within a
project year, from one budget line to another
 E.g. from A. Investments to B. Operations
• Budget transfer: transfer of (a part of) the
budget from one project year to another
• Budget extension period: for extending the
project
54
Budget shift
= shift in the budget from one budget line to
another within a project year:
• Is possible up to 20% of the last approved
budget for that budget line
• With a good justification and approval of
VLIR-UOS it is possible to shift more than
20%
– Request electronically through VLIR-UOSformats (see website):
» Word-document: narrative justification
» Excel-document: figures
– This should always be submitted before the end
of that project year
55
Budget transfer
The unspent balance of one project year can
be transferred to the next project years
• Approval needed from VLIR-UOS
– Request electronically through VLIR-UOSformats (see website):
» Word-document: narrative justification
» Excel-document: figures
– To be submitted at the same time as the AFR of
the previous year
56
Information on website
 http://www.vliruos.be/guidelines
1. International hotel and per diem allowances
2. Kilometer allowance
3. Scholarship guidelines
4. Financial guidelines
5. Reporting formats
6. Budget change formats
7. Control checklists 2014
57
GOOD LUCK AND THANK YOU!
www.vliruos.be

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