Responsibilities related to implementation

Signing financing agreement 

If application of financial support is accepted, an agreement will be concluded between the Operator of Programme concerned (OP) and Beneficiary. Whole procedure will proceed in accordance to the modalities established by relevant OP. Project financial agreement describes commitment and entitlement as well as agenda of the project and its budget. Subject of an agreement is an implementation of the project, according previously submitted application, which becomes an attachment to the documentation. Any possible changes in project agreement need to be accepted by proper OP. 

Eligible expenditures

During project realisation, its need to be remembered, that not every expenditure can be subsidised. Only expenditures from catalog of eligible costs are eligible for funding. The other costs are covered from Beneficiary’s own resources. General principles of eligibility of expenditures under EEA and Norway Grants 2014-2021 constitute that:

1. Eligible expenditures of projects are those actually incurred within the project, which meet the following criteria:
   1.  they are incurred between the first and final dates of eligibility of a project as specified in the project contract;
   2.  they are connected with the subject of the project contract and they are indicated in the detailed budget of the project;
   3.  they are proportionate and necessary for the implementation of the project;
   4.  they must be used for the sole purpose of achieving the objective(s) of the project and its expected outcome(s), in a manner consistent with the principles of economy, efficiency and effectiveness;
   5.  they are identifiable and verifiable, in particular through being recorded in the accounting records of the Project Promoter and/or project partner and determined according to the applicable accounting standards of the country where the Project Promoter and/or project partner is established and according to generally accepted accounting principles; and
   6. they comply with the requirements of applicable tax and social legislation.
2. Expenditures are considered to have been incurred when the cost has been invoiced, paid and the subject matter delivered (in case of goods) or performed (in case of services and works). Exceptionally, costs in respect of which an invoice has been issued in the final month of eligibility are also deemed to be incurred within the dates of eligibility if the costs are paid within 30 days of the final date for eligibility. Overheads and depreciation of equipment are considered to have been incurred when they are recorded on the accounts of the Project Promoter and/or project partner. 
3. Where new or second hand equipment is purchased, only the portion of the depreciation corresponding to the duration of the project and the rate of actual use for the purposes of the project may be considered eligible expenditure.
4. The Project Promoter’s internal accounting and auditing procedures must permit direct reconciliation of the expenditures and revenue declared in respect of the project with the corresponding accounting statements and supporting documents. 
5. In case of projects implemented by an international organisation or body or an agency thereof, the programme agreement may include specific provisions with regard to the eligibility of expenditure.

Catalog of direct and indirect costs was defined in articles 8.3 and 8.5 of Regulationson the implementation of the EEA and Norwegian Financial Mechanism 2014-2021 

The following costs shall not be considered eligible:

• interest on debt, debt service charges and late payment charges;
• charges for financial transactions and other purely financial costs, except costs related to accounts required by the NMFA, the National Focal Point or the applicable law and costs of financial services imposed by the project contract;
• provisions for losses or potential future liabilities
• exchange losses;
• recoverable VAT;
• costs that are covered by other sources;
• fines, penalties and costs of litigation, except where litigation is an integral and necessary component for achieving the outcomes of the project; and
• fines, penalties and costs of litigation, except where litigation is an integral and necessary component for achieving the outcomes of the project

Acceptance of funding means obligation to incur all expenditures with respect a principle of fair competition, efficiency, full disclosure and transparency, as well as make every effort to avoid a conflict of interest. Entities required by low to apply public procurement low, select contractors according those provisions. Entities, which are not obliged to apply public procurement low, should apply provisions of making expenditures for Beneficiaries not required to use public procurement low, outlined in detail in the guidelines. 

Control

Control accompanies realisation of every project, which received financial support from EEA and Norway Grants.

Project may be subject to the following control procedures:

• Validation of request for payments by Programme Operator – every submitted request for payment will be checked for integrity and accounting; additionally it will be verified, whether expenditures included in that request or settlement represent eligible expenditures.
• Validation of project in the place of its realisation or head office undertaken by Programme Operator – it may be carried out during realisation of the project, at the end of the project or after completion of the project; documentation and range of works within the project will be subject to control.
• Control performed according separate provisions – by: EFTA Board of Auditors, Financial Mechanism Committee (established by a decision of the Standing Committee of the EFTA States No. 4/2004/SC of 3 June 2004), and President of the Public Procurement Office, Audit Institution, and Supreme Audit Office. 

Reporting, financial settlement of the project and documentation

During project implementation period Programme Operator should be informed about progress made in the project. Reports should be prepared on a form drawn up by the Operator of the Programme concerned. The frequency of reporting is determined in the agreement for funding – usually quarterly reports are required or reports related to current level of expenditures in the project. Reports should inform about undertaken actions, obtained effects and incurred expenses – all this with respect to assumptions made in the application for funding.

Progress reports are usually integral part of the request for payment. In principle report is a basis for the payment of granted support. Depending on the characteristics of the programme, payments may take the form of down payment, interim payment and/or final payment.

Progress reports shall be verified in terms of compliance with assumptions included in the application for funding and in terms of correctness of the expenditures incurred. If there are mistakes or ambiguities, the application should be completed or corrected. If it turns out that project is implemented not in accordance with assumptions included in the application for funding or intended objective has not been reached, financing could be withdrawn. If the procedures related for instance with selection of contractors or service providers are not maintained, all or a part of support will be withdrawn.

During project implementation, collection of all data related to the project is very important. As a rule, they shall be presented with the request for payment. Any documentary evidence related to purchase or installation of fixed assets or use of services provided in the project are necessary for correct documentation. First of all sales invoices and a wire receipts are requested, but also protocols of good transfers, reception of contract works or services. If there are employees in the project – no matter if their salary was a subject to support or not – a full documentation confirming the recruitment process must be collected, as well as documentation concerning concluded contracts and meeting commitments to employees, Social Security Office and State Treasury.

Every accounting document shall be labelled in a way assigning it clearly to the particular project – for instance by application of the appropriate stamp. This was intended to prevent use of the same document for obtaining refund of costs in more than one project.

 All documents concerning the project should be recorded in a way allowing fast, easy and unambiguous identification. So called separate accounting records might mean implementation of uniform labelling of subsidized items or itemising the costs on specially created accounts.
For transparency of accounting, it is recommended that payments in the project shall be performed using separate bank account, indicated in the project agreement.

Promotion and labelling

Communication is an integral part of the implementation of the funding made available from Iceland, Liechtenstein and Norway through the financial mechanisms (called EEA and Norway Grants). All information and communication measures undertaken by the National Focal Points, Programme Operators, Project Promoters, and entities acting as partners in the implementation of the EEA and Norway Grants shall bring to the attention of the general public of the European Economic Area the contribution of the grants to the overall objectives: (a) contribute to the reduction of economic and social disparities in the European Economic Area; and (b) strengthen bilateral relations between Iceland, Liechtenstein and/or Norway and the Beneficiary States.

If you implement EEA and Norway Grants, you have not only the right, but also an obligation, to inform about that. Information about support should be published during realisation of the project, in the process of all information and communication actions, that are being taken.

The documents intended for publication and for the project participants, place of realisation of your project and web page (if available) should be labelled in an appropriate manner. In this way you inform public about financing from the specific programme.

Such an action is intended to increase public awareness concerning existence of EEA and Norway Grants, their aims, opportunities for bilateral cooperation with entities from Iceland,Liechtenstein or Norway, as well as increase common understanding of your project introduction, its results and impact.

You shall develop a Communication Strategy and report to Programme Operator how you perform your information and communication duties. You should include your Communication Strategy in the project application. 

Guidance on content of the Plan please find in the Annex 3 - Information and Communication Requirements, EEA and Norway Grants 2014-2021 (PDF 102 KB).The Project Promoter shall, during the implementation of the project, put up a billboard at the site of each operation which fulfils the following conditions: (a) the total public contribution to the operation exceeds € 50,000; (b) the operation consists in the financing of a physical object, infrastructure or of construction operations.

The Project Promoter shall replace the billboard with a permanent commemorative plaque that is visible, of significant size no later than six months after completion of the project.

Detailed rules of promotion and labelling of the projects under EEA and Norway Grants are described in the handbook Communication and Design Manual(PDF 6 MB).

Project sustainability

The completion of the project does not mean that all obligations have been fulfilled. The EEA and Norway Grants provide so called period of durability of the project, when the project is operational after approval of the project completion. This is the period, in which effects of the project, declared in the project proposal, should be maintained, in the intact form and dimension. The determination of this period shall be guided by the aim of promoting the sustainability of the project and of ensuring that the financial support provided to the project generates the maximum benefits to its target group and final beneficiaries.

The Programme Operator shall ensure that projects that involve investment are operational for at least five years after the Programme Operator’s approval of the project completion report and that investment is used for the purpose of the project as described in the project contract. For other projects, the period of minimum post-completion operation shall be determined by the Programme Operator, described in the call for proposals and included in the project contract.

After completion of the project there is an obligation to retain full documentation of the project for a period identified in the grant agreement. Documentation should be stored at head office of the Beneficiary. 

In the above specified period, there is an obligation to keep documentation at the disposal of institution which supported the project, The National Focal Point and Donor institution – if necessary.