1.Whether It S Correct Way of Thinking That an Interest Accrued on the Bank Account Opened

1. Whether it’s correct way of thinking that an interest accrued on the bank account opened solely for the purpose of the project is not considered as revenue generated by the project? These include interest accrued from the funds of the partner, which has been credited to a bank account in order to make transfers. These percentages are therefore not being generated by the project. Under the assumption that the interest generated are linked to the partner’s own funds and not to any ERDF, we would not consider this as revenue generated by the project, because the interest are not ERDF relevant.

2. Whether it’s correct way of thinking that if a project partner charges contractual penalties, accrued the supplier / contractor services for e.g. penalties for untimely and / or improper execution of the contract, the penalty should be considered as income generated by the project? This kind of penalties should not be considered as income generated by the project, but we would expect that the amount of the penalty will be deducted from the eligible expenditure to be reported.

If the penalty is deducted from the remuneration payable to the supplier / contractor, then automatically eligible expenditure is reduced in the project? Yes, this would be our understanding.

If the penalty is paid by the supplier / contractor on partner account , then it must be demonstrated in the report as income of the project, which reduces the eligible costs of the project? This is case seems very unlikely, in our experience we have never been confronted with such a situation. In any case the principle stays the same: the amount of the penalty should be deducted from the reported expenditure.

3. Whether sponsorship is eligible in the program? Again, this seems to us like a very rare case. But as a general rule, contributions in-kind are not eligible in Interreg Europe, and that all regulations regarding revenues have to be respected. We could imagine a situation where a partner organises a conference and for instance a networking-cocktails is provided by a sponsor. However, as only real costs can be reported in Interreg Europe (with the exception of the lump sum for preparation costs and the flat rate for administration costs), the partner could not in such case declare the costs of the networking-cocktail as its own partner contribution.

4. Whether FLC should check all procurements below national thresholds in compliance with internal rules, including publicity requirements? If so, when the rules of internal procedure on procurements below national thresholds allows the award of a contract without a procedure providing documentation proving equal treatment, transparency rules, project partner is entitled to apply this internal rules, or the procedure has to be conducted in accordance with programme procurement principles, regardless of internal procedures, and project partner has to present certain documentation, for example: mailing list, copies of www, contractors offers, …? As stated in programme manual section 7.7.6, as a matter of principle, the stricter rules must always be applied. Also, what has to be remembered is that at the heart of the rules governing the public procurement is the fact that whenever purchases are made and contracts are awarded to external suppliers, project partners have to be in a position to demonstrate the good use of public funds. Exactly how the partners have to prove it depends on the EU public procurement directives, the national rules, and the internal rules of the partner organisation. Please note that the rules that we mention in the programme manual are the existing European and national laws, Interreg Europe does not define its own additional programme rules on public procurement.

5. What is a threshold for the bid-at-three rule and how has to be documented? As stated above, there are no programme-specific thresholds for public procurement, thus no programme-specific rules concerning the bid-at-three. The rules that have to be respected by project partners (and their compliance subsequently checked by the controllers) are the EU public procurement directives, the national rules, and the internal rules of the partner organisation that apply to public institutions regardless of whether EU funding is involved. 6. “Central to ensuring adherence to the public procurement rules is the tender documentation, which usually consists of the following:”(p. 111) - Does it apply to all proceedings, regardless of the threshold ? Is every item of expenditure, without insight on its value requires documentary proof that every contract has been awarded on the basis of objective criteria which ensure compliance with the principles of transparency, non-discrimination and equal treatment and which guarantee that tenders are assessed in compliance with competitiveness rule? Having in mind our experience, the national rules should be followed here. As far as we are aware, the auditors usually do not require additional proofs that are not compulsory at the national level.

7. “Private non-profit bodies participating in an Interreg Europe project also have to be able to prove how they awarded project-related contracts in compliance with these principles and relevant national rules and guidelines “(p.112)- These institutions are exempt from the application of the polish Public procurement law act. Does it mean that all project partners, including private companies and NGO’, so partners which according to EU and national law are not follow into category of institutions obliged to employ public procurement law, under the programme rules have to follow a polish Public Procurement Law and respective EU law ? From our point of view, the principles of transparency, non-discrimination, equal treatment and competition should be complied with in any case when EU funding is involved. Moreover the general principles of eligibility also apply to private non-profit bodies. They have to prove that their costs are reasonable, justified and consistent (sound financial management).

8. “If objective proofs do not exist, an open tender still has to be organised. Its outcome will then prove if there is really no equivalent alternative on the market “(p. 112/113)- Should this condition apply to all contracts ,even below national threshold? Please be informed, that at national level, direct award procedure was set with full compliance with the Directive. Again from our perspective it is the Directive, the national and the internal rules that set the frame for public procurement. No such rules are set at programme level.

9. Sick pay in salary calculations based on hourly rate : whether employee a sick pay paid by the employer may be proportionally allocated to the project i.e. according to number of monthly worked hours?

Example for reporting period January June: sickness allocated to the project in a given month = hourly rate x indicator of employee time commitment to the project during the reporting period x number of hours of illness in a given month where: hourly rate set in contract/result of salary calculation indicator of employee time commitment to the project during the reporting period = (number of hours devoted to the project during the reporting period)/(number of working hours in the reporting period)

Example: The hourly rate of remuneration of Mr. John Smith was in contract 50 pln / h. (He worked 100 working hours in January)

In January, Mr. Smith was three days on sick leave paid by the employer.

In the reporting period January - June Mr. Smith devoted 136 hours to the project \ with respect to 992 working hours in the reporting period. Ratio was: 13.71%.

Therefore, the project can be allocated for the leave salary of: 50 pln / hour x 3 days x 8 hours per day x 13.71% = 164,52 pln As stated in INTERACT document Questions & Answers: Eligibility of expenditure in cooperation programmes (attached) in an answer to question 21: For part-time staff with a flexible number of hours worked on the project, eligible staff cost is calculated based on an hourly rate and the actual time worked on the project. If an employee is on a sick leave, the time worked on the project equals zero.

10. Staff: One of documents necessary to control is: “Proof of payment”. How JS understand this provision? Could be for example: bank statement, a statement of account ledger, confirmation of payment for individual salary components: tax, social security, net salary? Whether these documents are required together? The above mentioned document in the answer to question 13, indicates that a proof of payment of salaries and the employer’s contribution is necessary. The exact documents are not specified.

11. Whether is possible to change a salary calculation methods during a project lifetime ? In our opinion, the salary calculation method depends on the type of contract. Thus, the change of the calculation method is possible, if the employees contract changes in relation to the project (for instance, s/he passes from a full-time employment with the project to a fixed percentage contract).

12. Whether the transport costs should always be carried out in the most economical way? One of the general principles of eligibility, as stated in section 7.1 of the programme manual is compliance with sound financial management. All costs must be reasonable, justified, consistent with usual internal rules of the partner, the EU, the programme and national rules.

13. Whether the journey in the first class train and plane is eligible? In accordance with the above mentioned rules, it could be eligible, provided that the internal rules of the partner institution allow it.

14. Whether a justification for the use of taxi and private car is needed? Again, this is something, we think depends on the internal rules of the partner institution.

15. Whether all travel tickets and boarding passes must be strictly collected and retained for audit purposes ? In our opinion, as a general principle – yes. However, we have seen auditors accept other documents of equivalent probative value in cases where boarding passes were not available (e.g. signed participants lists, photos of the event).

16. What in situation of a lack of a ticket/boarding passes, what will be sufficient to confirm conducted trip? Whether only list of attendance is sufficient to prove travel? Please see our answer above.

17. Generally the time frame of journey should meet deadlines for a delegation (the day before / after the meeting, seminar, conferences), whether is possible that the exceptions to the rule are those cases where there is evidence that the additional costs associated with the extension of the duration of the delegation (eg. the cost of additional accommodation) do not exceed savings resulting from extension of travel duration(eg. reduced flight costs) ? In our experience, this could be possible, provided that the internal rules of the partner institution allow it. What also needs to be taken into consideration here is the already mentioned principle of sound financial management (programme manual section 7.1).

18. In accordance with the personnel policy of the partner organisation, costs such as bonuses, fuel, lease car, relocation benefits, luncheon vouchers etc. can be fully or partly take into consideration to calculating the eligible share for the project - entry in the Manual allows take all the possible ingredients if they are in accordance with a remuneration regulation of the institution. the question is whether the costs below are eligible : occasional awards, service awards; recognition awards, the amount of which is not justified by the implementation of project activities; retirement benefits; benefits funded by the social fund (social benefits such as recovery for cinema/theater ticket, recovery for holiday costs) , additional packages of medical health care financed by employer through social fund, a Christmas bonus and other occasional bonuses not recovered by employer)? We could imagine that they could be eligible, if they are in accordance with internal rules and in accordance with the regulations (EU and national).

19. Whether a performance cost of artists and tickets for entertainment venues/guided tours are eligible? In principle, as indicated in the programme manual section 7.5, the project partners need to prove (and the FLC has to verify) that the expenditure is directly linked to project implementation and necessary for successful project implementation. Pure entertainment or touristic activities are usually not considered eligible.

20. Whether purchase of alcohol for project meeting is eligible ? In our experience this depends on national and internal rules of the partner.

21. Whether the cost of general training for employees (eg. language courses, MS Office) is eligible ? It could be eligible, provided that it fulfils the general conditions stated in section 7.1 of the programme manual, and especially it would have to relate to activities planned in the application form, be necessary for carrying out these activities and achieve the project’s objectives and be included in the estimated budget.

22. Whether all orders/ contracts they must be in writing or especially lower costs can be supported only by invoice? As a general principle (see section 7.2.4 of the programme manual), a contract or other written agreements of equivalent probative value laying down the services to be provided with a clear link to the project [for instance an email], is required for all external expenditure. However, if it is a general commercial principle that a contract is not required (for instance, a purchase done in a supermarket), then the written contract should not be required.

23. Whether the attendance list at the meeting organized by the partner / conference / seminar, along with hand-written signatures of participants is required ? A signed participant’s list is the most straightforward way of proving participation, in our experience, we see little alternative to that. However, we have seen electronic registration systems for events with a large number of participants (e.g. more than 500 people), which was then also accepted by first level controllers.

24. Whether the purchase of equipment is subject to the durability of the project - (public institutions 5 years) ? Article 71 of Regulation No 1303/2013 only refers to investments, but not to equipment (in the sense it is potentially purchased in Interreg Europe projects). Therefore this article does not apply to Interreg Europe.

25. Whether a computer or printer for the project, which is eligible under category project equipment so is not a part of investment, doesn’t need to be marked? If you mean whether it needs to comply with any specific publicity requirements (like a sticker with a logo etc.), in such a case the programme publicity rules (derived from the Regulation) does not require such a sticker.

26. If partners are not obliged to apply a regulation on business trips according to national rules (private bodies), to calculate the cost of travel is used internal regulations adopted in the institution. In the absence of internal regulations travel expenses are accounted for on the actual expenditure (invoices, receipts) - how properly calculate real costs? Whether there are any restrictions in this regard ? Do partners have to calculate travel allowance according to Council Regulation (EC, Euratom) No 337/2007 of 27 March 2007 as a maximum rate? Also this issue should be decided based on the principle of sound financial management mentioned in section 7.1 of the programme manual. 27. Do we need a copy of documents (such as payrolls, invoices) confirmed as true copy? Please be informed that national circumstances do not allow to collect original accounting documents such as invoices, payrolls. The programme manual states in section 7.5 that the lead partner and the partners must ensure that all accounting documentation related to the project is available and filed separately, even if this leads to a dual treatment of accounts (for example, if the usual accounting management requires central filing, a copy should also be kept in a separate file to allow quick access to the project’s supporting documents). Whether this should be a certified copy is not defined by the programme and depends on national accounting requirements. What we often see is that the desk check is based on copies and then the controller verifies the compliance with originals during an on-the-spot check.

28. Is the cost of designing and making the logo eligible? Whether every time partners have to have permission of JS? As indicated in section 8.1.2 of the programme manual, the projects are not encouraged to develop their own project logo, because they have a limited shelf life. Developing a logo is costly compared to the benefit such special branding can bring to the project during its limited lifetime. A specific logo might however be considered for an output/ result with a lifetime going beyond the project. Prior approval of the joint secretariat would then be required.

29. Annulling of the documents. We don’t see any requirements concerning limiting of risk of double-founding by marking/describing invoices, payrolls, ect. with at least acronym, project name, a description of the program. Are there any obligations concerning this matter? Must documents such as invoices be marked/stamped? As stated in the programme manual in section 7.5, it must be possible to clearly identify which expenditure has been allocated and reported for the project and to ensure that expenditure is not reported twice (in two different budget lines, reporting periods, projects/funding schemes). This can be ensured either by a separate accounting system or an adequate accounting code to be used for all expenditure related to Interreg Europe. Exactly how the institution decides to show this information in their accounting documents (e.g. directly printed on the document or by stamp / handwritten annotation) is not prescribed by the programme. We only require that the system is coherent, and the expenditure related to the project is clearly identifiable.