Administration of the activities

Administration is an integral part of the management of all types of projects. Sound contractual and financial management, project documentation, monitoring and reporting are the basis for being able to steer the project in the right direction and for being in a position to account to the funder for the resources invested. An official Project Management Handbook should be provided by the coordinator as an integral part of the Grant Agreement. It explains in detail the rules and regulations which apply in a Partnership. The Grant Agreement and the Project Handbook are crucial documents for the implementation of a Partnership. They set the legal basis for the project and should be read intensively and discussed during the project meetings.

The administrative tasks demanded by the EU funding programme are an important factor in contributing to the project’s success.

Monitoring can be defined as a continuous process of assessing the progress made towards stated objectives and identifying gaps between the original project plan and the actual achievements. It is understood to be the regular assessment of the three basic project constraints: Scope, cost and time. In other words, it is a mechanism to analyse whether the planned range of products are being developed to the agreed quality, on time and within the allocated project budget.

The co-ordinator of a Partnership Project always needs to have a clear picture of the performance of geographically dispersed team members with regard to the fulfilment of agreed tasks within the predetermined time span and allocated resources. Only with this clear picture in mind does the co-ordinator have a chance to adopt corrective action, if needed, and thus steer the project successfully.

Main tasks

The management of contractual relations

The project management manual is a tangible file held at the co-ordinator’s workplace. To make it available as an important reference document for all partners it can also be uploaded onto the virtual project workspace. In this way it serves these functions:

• Information: Everybody can look up the documents whenever needed
• Transparency: Everybody has access to essential management information
• Quality: To maintain the value of the manual, constant updating is necessary.

In addition to recording project activities and maintaining a project management manual the introduction of a document standard is also useful. A standard helps to identify a document, clarify its author, status and purpose and contributes to a sense of ownership of the project amongst team members.

 Documentation of activities

Documentation of activities is concerned that a project has not achieved anything unless the achievements are documented. In the final assessment of the project the funder expects proof of the implemented activities, and the impact achieved. This is a weak point in many projects. Signed participation lists, photos, agendas of meetings, conference programmes etc. add considerably to the credibility of the project and help the assessors of project reports to evaluate the project positively. From the beginning of the project documentation requirements as specified in the final report forms should be taken into account and evidence systematically collected. This saves a lot of time at the reporting stage.

With regard to management-related documents, it is advisable to introduce a project management manual.

Internal progress reporting

A European project co-ordinator should insist on regular written reports from the partners in all cases. However, the frequency of these reports can vary from project to project. The reporting periods may depend on several factors:

• How complex are the various strands of activities carried out by the partners?
• How important are the partners’ tasks for the success of the project?
• How independently from the co-ordinator do the partners act?
• How much money is involved?
• Which type of financial management has been chosen: Are funds administered by the partners themselves or is this done centrally by the co-ordinator?
• Does the co-ordinator know the partners from previous projects or are they co-operating for the first time?

In many cases two or three progress reports during the lifetime of the project have proved to be good practice. They give the co-ordinator sufficient information without overloading partners with reporting tasks.

It is helpful to establish in the partnership the understanding that reporting is not entirely about spreading good news and success stories. Problems, obstacles and failures are much more relevant, as it is this kind of news which requires remedial action. It is from the shortcomings in particular that the whole team can learn the most valuable lessons and improve the overall project performance. The data in the reports from each partner must be easily comparable. This is why the project co-ordinator is wise to introduce a uniform set of reporting tools which everybody is obliged to use. The set of reporting forms may even constitute an annex to the partner agreement to make sure they are noticed.

The administrative workload involved in a European project is big enough, so doubling the paperwork should be avoided. The format and frequency of internal project reporting should therefore correspond with and feed into the co-ordinator’s reporting obligations towards the funder. To ensure this congruency of information, many Partnership Projects pass on to their partners the reporting sheets the co-ordinator has to complete for their reports to the Executive Agency.

Documentation of costs

It is crucial that the project co-ordinator ensures that costs are sufficiently documented in all partner organisations, especially in those with decentralised systems of financial management.

All project costs need to be visible in the bookkeeping of the partner organisation, i.e. the project needs to have a unique account number and all costs should be clearly and unmistakably allocated to that account. Furthermore, all partners are required to have evidence of all expenditures made such as invoices, bills, tickets, etc. as well as proof that these costs were actually paid (balance statements, receipts, etc.).

Many partner organisations insist on keeping the originals of these documents in their own finance departments. A safe way for the co-ordinator to handle this need is to ask for certified copies (note: True copy of the original, plus date, stamp and signature of the financial officer) and to make clear to partners that they will have to keep the cost documentation for at least five years after the termination of the project. During this period the Executive Agency can do a randomly chosen audit and request to see all the financial documents.

 Timesheets

Teams need to get paid and timesheets are a tool that helps accomplish that. As in any employment, timesheets are a way to track the number of hours a person has worked over the course of a specific time, usually a week or biweekly.

In project management, timesheets do more than just facilitate payment. They’re used as project controls to record the amount of time that the team member has spent on their specific tasks, though they can also track time on a project or for a particular client.

Timesheets can be used in a variety of different modes, from paper to spreadsheets and software. Online timesheets can even update in real time. However, you use a timesheet, they’re vital for payment, meeting deadlines and keeping to your budget.

 Financial management

Once the contractor has signed the financial agreement with the Executive Agency and received the first instalment of the grant financial management issues become an important part of the project work. Several tasks are involved in financial management:

• Revising the project budget
• Forwarding the European grant to the partners
• Ensuring an understanding of the financial rules in the partnership
• Establishing an efficient internal financial reporting system
• Monitoring the eligibility of expenditure and its congruence with the budget plan
• Ensuring that the necessary claim documents are provided by all partners
• Reporting expenditure to the funding body

The central document in all financial matters of a Partnership is the official Project Handbook which is an annex to the Grant Agreement. The co-ordinator as well as the project partners should be well aware of these regulations. They do not need to be repeated here. Instead, the more general aspects of financial management will be discussed.

The lead partner has the overall responsibility for financial management, but each partner organisation must monitor its spending and keep its own records on expenditures for the project in question. The task for the lead partner is to make sure that project partners only report expenditure in line with their original budget, do not exceed the budget for different categories of costs, or claim costs under headings where they have no budget. In most cases, however, the new online systems being put in place should make this kind of basic mistake impossible. Lead partners need to be aware of how different programmes address these kinds of formal errors. Some have a degree of flexibility. Others will rule expenditure ineligible if it is in conflict with the approved budget in any way.

 Financial control

Every time a project claims money from a programme, the spending report has to go through a financial control check to make sure that spending rules have not been broken. This check is normally called First Level Control. In addition, because the controllers responsible for this First Level Control (‘control’) do not always spot all problems, a Second Level Control (‘audit’) has been set up. This involves re-checking some project spending to make sure that there are not too many mistakes. In addition, there are sometimes checks by the European Commission and the European Court of Auditors. Projects must therefore know the basic requirements and rules for spending and reporting costs before they start; there are quite a lot of formal requirements, and partners need to make sure they can provide the documentation required.

Illegally claiming money from the EU budget can lead to financial cuts in the project and – in severe cases – to court procedures. Make sure you are familiar with basic rules such as public procurement and ensure that all of the project partners in your project can always document expenditure. Then you should not have any problems. The result of many project controls and audits is zero negative findings, and zero reduction to the funds claimed. That said, some projects seem to have almost endless problems and may have to pay back most, if not all, of the funding they have received.

• How do you make sure you are managing the budget correctly?
• Be absolutely clear about what the EU, programme and national rules are for every type of expenditure you are claiming.
• Communicate this to every project partner and make sure they are living up to every requirement. Do this repeatedly and never assume that what you have said is the same as what has been understood – experience shows this is generally not the case.
• Stay away from borderline costs. You can claim costs which are necessary for delivery of the project – and only these costs. If you are in any doubt, ask the programme secretariat.
• Make sure you know your controller and make sure he/she knows your project and what you are trying to achieve.

Some controllers are willing to provide useful information and help you improve your financial reporting. Financial control and audit can have many layers but behind all of these lies one basic fact: All funds claimed from the European Commission must be eligible, and every Member State needs to set up an effective system for ensuring that this is the case. The risks are significant. If one of the control or audit bodies carries out a check and finds that ineligible expenditure has been paid out to a project, this may result in significant cuts to accepted project expenditure. Each country therefore designs a system that it feels is safe based on its own needs and experiences, and although programmes try to harmonise basic requirements it is possible that different project partners in the same project face different control requirements.

 Eligibility rules

In order to receive funding, all of the costs reported by a project must not only be ‘correct’ – calculated and entered accurately in your organisation’s book-keeping system, they must also be ‘eligible’ – meaning that they live up to a number of special rules governing EU expenditure. The EU, programme and national levels will all have eligibility rules to make sure that funds granted to projects are not wasted or misused.

Never assume that the rules and systems in place in your country automatically apply to the rest of the partnership. Every project partner needs to check eligibility rules carefully before and during implementation to make sure that any proposed expenditure is allowed in their country.