FM EEA/Norway in the Czech Republic

Sofia 28th May 2009

NFP Czech Republic

• Implementation status

• NFP structure

• NFP Manuals & Guidelines

• National Appraisal Process

• Financial Flows

• PIR processing & complementary monitoring

• On-the-spot monitoring & Financial Audits

• PCR processing

Presentation points:

Implementation statusTotal allocation: 104,58 MEUR

Committed

Disbursed to Project Promoters

% (disbursed vs.

committed)

Block grants/Funds 19 624 955,00 14 627 309,00 74,53%

1st Call 23 654 509,00 16 278 937,00 68,82%

2nd Call 38 401 534,00 2 388 076,00 6,22%

3rd Call 22 842 495,00 61 418,00 0,27%

Savings from Calls recommited to Scholarship Fund

56 090,00

Total 104 579 583,00 33 355 740,00 31,90%

NFP – Division of responsibilities

• NFP CR located at the Ministry of Finance (Government resolution)

• Programming & Assessment CFA 1

• Implementation, Monitoring, Evaluation CFA 2

• Contracts & Payments to Promoters CFCU

• Financial flows to/from the FMO Paying Authority

(NF)

• Controls Department of Control of the MoF

NFP Manuals & Guidelines• Internal:

– NFP Manual for FM EEA/Norway

• External:– Guidelines for Applicants– Guidebook for Project Promoters/Intermediaries

– Project deadlines– Project modifications– Tender procedures– Accountancy & documentation– VAT

– Guidelines for Eligibility of Expenditures– Guidelines for PIR and PCR filling-in– Methodology of financial flows and controls

NATIONAL APPRAISAL PROCESS

• change of the national appraisal process under the 3rd Call – approved simplification of the appraisal process

• shortening of the whole appraisal

process

• the appraisal process more efficient

LEVELS OF THE NATIONAL APPRAISAL PROCESS

1) Level I – Checking of administrative compliance and eligibility criteria (at Regional Contact Points)

2) Level II – Evaluation of quality (Contact Points at Ministries)

3) Level III – NFP Assessment

LEVEL I - Checking of administrative compliance and

eligibility criteria• Regional Contact Points (RCP) - submission

of applications according to the place of a project implementation

• Checking of administrative compliance and eligibility criteria (in accordance with relevant checklists)

• Submission of recommended complied applications to the relevant CP at Ministries (according to the prevailing FM EEA/N priority area)

LEVEL II - Evaluation of quality

• Contact Points at Ministries (MCP) – each application is evaluated by 2 external evaluators

• Evaluation of quality (in accordance with the evaluation criteria)

• Evaluation Committee (nominated by MCP) – non-voting and voting members

• Recommended applications (within the allocation for the relevant priority area) are submitted to the NFP

LEVEL III – NFP Assessment (1)

The NFP assessment is primarily focused on:

• Needs analysis

• Appropriate correspondence between activities and schedule

• Measurable indicators

• Justified budget

LEVEL III – NFP Assessment (2)

2 phases of the NFP assessment:

• Phase I – External Assessment (TA)

• Phase II – Reasoned Opinion issued by the NFP

LEVEL III – NFP Assessment (3)

External assessment (TA):

• Independent assessment by external TA team (selected under an open tender procedure, TA team is not allowed to be involved in the preparation of any application under FM EEA/N)

• TA carries out a detailed assessment of all applications (Czech versions) submitted to the NFP

LEVEL III – NFP Assessment (4)

External assessment (TA):

• Outputs of the detailed assessment:

1) Reasoned Opinion in Czech (detailed information about projects for discussion in the Monitoring Committee meeting)

2) Appraisal Summary in English (based on a Detailed Appraisal Report of the FMO Appraisal Manual; the aim is to provide a background scoring and identification of issues of strength and weakness for a project assessment and elaboration of a Czech RO)

LEVEL III – NFP Assessment (5)

External assessment (TA):

• MoC meeting, recommendations of projects to be submitted to the FMO

• Successful Applicants asked by the NFP to submit an English version of the application

• TA team checks EN applications and if the identified problems maintain or are insufficiently clarified, the applicants are asked to provide additional information or missing annexes/documents

LEVEL III – NFP Assessment (6)

Reasoned opinion (RO) completion by the NFP:

• TA elaborate a draft RO in English (serve as a basis for the NFP decision on sending the applications to the FMO)

• NFP will complete the RO and Appraisal Summary to each recommended applications

• Package – Application Form, RO, AS and Recommendation letter – sent to the FMO for each application

CONCLUSIONS

• Simplification of the whole appraisal process

• Removing of the duplicity of the appraisal process between the NFP and FMO (the FMO required the DARs only for problematic projects)

• Shortening of the period between the deadline for applications submission and the 1st project approved by the FM

FINANCIAL FLOWS

State BudgetCo-financing

GBCFM

EEA/Norway

National Fund Universal account (settlement of FX

rate difs. of refunds)

NF resources –

FM EEA (EUR)

NF – resources Norwegian FM (EUR)

CFCU resources – FM EEA/Norway (EUR)

Refunds(CZK)

Tax Off.

PP´s accountSupplier

PIRs PROCESSING• PIR generated, template checked and sent to the PP • PIR + all supporting docs. received (electronically)• PIR check

» CFA – progress of implementation, changes, project conditions» CFCU - eligibility of expenditures, request for payment,

budgetary limits

• Commenting of the PIR – financial and factual part together• PIR approval by Head of Unit (PIR+checklist+supporting docs)• PIR hard-copy sent to the CFCU, check of compliance with last

approved electronic version, signatures • Request for payment sent to the Paying Authority (NF)

Close cooperation between the CFA PM and CFCU PM Checklists Keeping of separate budgetary tables (per headings and activities) Clear and reasonable requirements on conditions fulfilment Problems in particular PIRs solved on the HoU level

Monitoring (1)Approval of project

modifications

below 15% activity/heading NFP – in PIR

above 15% activity/heading FMO ex-ante

X

PIR templates not fitting the GA conditions,

(only total grant drawing is checked) „automatic“ reallocations between activities

and budget headings, which is non-eligible

Eligibility of expenditures

a. Continuous monitoring of limits by using special xls. tables

b. „early warning“ to the PP if expenditures are close to limit or systematically underspent possibility to apply for project modifications in time possible savings in one activity may be utilised to cover additional expenditures in another efficient utilisation of project allocation

Monitoring (2)Project conditions

Specific conditions stated in the GA

FMO requires their fulfilment– prior to first reimbursement– during project implementation– after project completion

Insurance (during/after completion)Waste management (during)Maintenance (after completion)Ethical standards (during)Using results in accordance with the purpose Reinvestment of incomes into the project+ others

Non-compliance with the conditions:During implementation – suspension of reimbursementsUpon completion – breach of Implementation contract

Obligations of PPs

PP accepts all conditions in the „Acceptance letter“

PP is bound to meet them in line with the „Contract“

Some conditions are financially demanding

it is crucial that:

PP is informed about the conditions and their impact before signing the Contract

PP is able to meet the conditions set for the project

PP ensures sufficient financial resources for the implementation and sustainability period

On-the-spot monitoring• Complement to „formal“ monitoring

• Based on quarterly updated risk analysis (risk factors)

• Independent and expert assessment of project

OSM team: administrative compliance & expert view• Project progress in compliance with PIP and Contract

• Fulfilment of project conditions and indicators

• Tenders, accountancy, project management, adequacy of controls

• Publicity, documentation, cooperation with partners etc.

• Adequacy and eligibility of expenditures, their effectiveness

• Assessment of quality of the works

• Effectiveness of proposed changes

• OSM = two functions: monitoring & consultations

Financial audits

• Independent from the NFP – contracted company

• At the project closure positive audit statement is a precondition for the PCR approval

• Check of all documents related to the project

• Check of eligible expenditures and financial reporting

• Detailed check of the tender procedures

• Detailed check of the project accountancy

• Check of invoices and delivery of invoiced goods/services

• Potential findings from audits:• Suspicion of irregularity

• Suspicion of breach of the Contract and/or the Budgetary rules

– CFCU and Control Department/Financial Offices take appropriate steps

PCR processing• STAGES:

1. Approval of the Final PIR

2. Filling in the PCR (NFP Guideline)

3. Financial audit (plus OSM)

4. PCR approval

5. Payment of retention money

• SUPPORTING DOCUMENTS

– Approval from the building authority

– Transfer of assets

– Lists of participants/Study visits reports

– Insurance contract + first instalment

– Maintenance account – statement of account with 1st instalment

– Statutory declaration on environmentally sound waste management

– Statutory declarations on proper utilisation in line with the purpose

– Publicity/press articles/photos

Thank you for your attention.

www.eeagrants.czczp@mfcr.cz