Knowledge Exploitation Fund (KEF)

Transcription

1 Knowledge Exploitation Fund (KEF) Procedural Guidance Manual Revised June 2003

2 Contents Page Contents Page 1. Introduction 6 2. Introduction to KEF Strategic Aims 7 3. Strategy for Entrepreneurship Introduction Institution Operational Plan Eligible Expenditure Beneficiaries Application Process Assessment Process Strategy for Innovation Introduction Institution Operational Plan Eligible Expenditure Beneficiaries Application Process Assessment Process Consortia for Training and e-training Networks Introduction Eligible Expenditure Beneficiaries 40 2

3 6. Entrepreneurship Scholarships Introduction The Role of the EC ES Business Planning Guide Eligibility Criteria Application Process Assessment Process Assessment Criteria Allocation of Funds Payment of Scholarships ES Monthly Monitoring Reports Inputting Scholarship Data to IPM 7. Technology Transfer Projects Introduction Application Process Technology Transfer Networks Technology Transfer Centres Eligible Expenditure Claims, Auditing and Monitoring Evaluation Publicity KEF Help Desk 77 3

4 GLOSSARY EC ERDF TTC TTN ESF FEI HEED HEI IPM KEF SME WAG WDA WEFO Entrepreneurship Champion European Regional Development Fund Technology Transfer Center Technology Transfer Network European Social Fund Further Education Institution Higher Education Economic Development Higher Education Institution Internet Project Monitor Knowledge Exploitation Fund Small and Medium Sized Enterprises Welsh Assembly Government Welsh Development Agency Welsh European Funding Office 4

5 Contact: Knowledge Exploitation Fund ELWa South West Wales Ty r Llyn Waterside Business Park Clos Llyn Cwm Swansea Enterprise Park SWANSEA SA6 8AH Website: Kefhelpdesk@elwa.org.uk Helpdesk:

6 THE KNOWLEDGE EXPLOITATION FUND 1. INTRODUCTION The purpose of the Knowledge Exploitation Fund (KEF) is to provide support for the effective transfer of knowledge, skills and ideas from Further Education (FE) and Higher Education (HE) institutions to industry, in order to stimulate the knowledge economy of Wales. It does this by working to change the culture of FE and HE institutions in respect of their attitudes towards entrepreneurship and innovation, the twin engines of the knowledge exploitation process. KEF is raising the capacity of FE and HE institutions to develop and implement entrepreneurship and innovation strategies. KEF has completed a successful first phase ( ) and while the second phase will continue to support the Entrepreneurship Action Plan, it will also focus on supporting the emerging Innovation Action Plan/Strategy of the Welsh Assembly Government. In order to bring about the required cultural changes in FE and HE institutions, and so achieve long term benefits for the economy, it is essential that KEF s main activity of building institutions capacities to become more entrepreneurial and innovative is sustained. KEF will promote capacity building for entrepreneurship and innovation by, inter alia, embedding institutions strategies into action plans, tailored to meet local needs as well as the pursuit of excellence in research and development. KEF will assist by contributing towards the support of entrepreneurship and innovation strategic planning, development and related activities of each FE and HE institution. It will also provide specific support for the development of sector specific training consortia, as well as commercial exploitation and technology transfer activities. In addition to responding to the Assembly s economic priorities, KEF will also underpin the National Council s goal of developing the ability to apply knowledge, as well as supporting the work of the Higher Education Council in requiring HE institutions to develop sustainable and coherent strategies for Economic Development activity. KEF is advised by a steering group, which is strengthened by the inclusion of additional business interests. The steering group is chaired by HEFCW s Director of Higher Education, and comprises two senior representatives from each of the WDA, WAG, FE and HE sectors, and industry, and one officer each from the National Council and the Higher Education Council. In addition, regular liaison by the management team with WDA and Assembly colleagues continues to be fundamental to delivery of KEF 6

7 2. INTRODUCTION TO KEF STRATEGIC AIMS The key elements of KEF s future strategy are outlined below under three goals, each of which gives rise to a number of actions and performance targets. Goal 1 To ensure a cultural change towards innovation and entrepreneurship within HE and FE institutions through activities designed to create, value and promote innovations with a view to commercialisation Key actions: 1. Support institutional strategies for innovation and entrepreneurship which will improve awareness, increase the impact within the curriculum and build up the level of expertise within institutions of the skills and appreciation of the value of innovation and entrepreneurship; 2. Collaborate with joint activities of the Entrepreneurship Action Plan. This will support the WDA culture projects, education projects and the EAP on-line strategy; 3. Facilitate events including exhibitions, conferences, seminars and enterprise days to raise awareness and celebrate success; and 4. Promote entrepreneurship and innovation through the development of the KEF web site and the joint development of the innovation4wales web site, in partnership with the WDA to raise awareness, celebrate success and promote case studies of successful entrepreneurship scholarships and innovation developments Goal 2 To raise entrepreneurship and innovation skill levels, confidence and ability both of staff and students in Further and Higher education institutions Key Actions: 1. Provide training for entrepreneurship for an additional 8,000 students in Welsh institutions. 2. Develop new training programmes for innovation at NVQ levels 3-5 to include technology management postgraduate degrees, linking technical innovation and entrepreneurship; 3. Support innovation in companies through the development of sector specific training consortia for key growth industries in Wales, which will, with the innovation strategy and action plan increase the workforce development capacity of institutions, 4. Build on the successful SME e-training consortium project in South West Wales to provide an all-wales initiative for e-training. This will support the ELWa e-learning strategy, thus enabling the sharing of digital education resource material as well as accreditation and assessment methodologies 7

8 providing in the first instance e-training networks in South West, North and South East Wales; 5. Provide master classes in entrepreneurship and innovation for academic staff; and 6. Increase the level of commercial consultancy and training for Welsh companies undertaken by institutions. Goal 3 To accelerate the successful application of knowledge and the commercialisation of ideas and products developed in institutions Key Actions: 1. Develop and introduce Proof of Concept support for the commercialisation of products developed in HE and FE institutions. This will include identification and protection of ideas, opportunity analysis and demonstration/development trials of products; 2. Award Entrepreneurship Scholarships to recognise and support the excellence of knowledge based enterprises by graduates from FE and HE Institutions and to track these enterprises to learn from their experience and promote their success; 3. Provide additional incubator places in institutions; 4. Develop centres of expertise and knowledge transfer, optimising the use of resources in FE and HE institutions; 5. Support collaborative projects between institutions and/or companies exploiting new technology in order to increase the R&D capacity in the region. 6. Support technology transfer networks clustered around the knowledge transfer centres; 7. Create new high technology jobs through the demonstration and consultancy services of the technology transfer centres, collaborative projects transferring technology to industry and proof of concept activities; 8. Assist the development of new companies through assisted incubator places, entrepreneurship scholarships as well as resultant spinout and joint venture initiatives from the proof of concept funding, and 9. Appoint Innovation Champions to support clusters of FE Institutions in the development of the commercialisation process for FE institutions. 8

9 3. Strategy for Entrepreneurship 3.1 Introduction Entrepreneurship is widely recognised as a key factor in business success. KEF is helping develop a new generation of entrepreneurs through the provision of training for both students and academic staff. If the full benefits of the KEF project are to be taken advantage of by institutions then the culture within the institution must become conducive to entrepreneurial activity from both staff and students. To make this happen key personnel will need to be involved in the management of change which will be necessary. The direction for entrepreneurship under the KEF project is to build on past successes and further develop areas and examples of good practice throughout Wales. KEF strives to push forward the boundaries of knowledge exploitation from both Higher Education and Further Education institutions within Wales. The development of a fertile culture with the correct structures and available support for staff is essential. Institutions can take advantage of the support which KEF can offer to help change practices, attitudes and the ways of doing things to help build a long term and prosperous future for all stakeholders in Wales plc. 3.2 Institution Operational Plan In order to mainstream the Culture Change within institutions there should be evidence of the commitment to the support and promotion of entrepreneurship within the strategic plan of an institution. In HEI this will be evidenced throughout the HEED plan and in FEI as part of the institutions operational planning document. The commitment should include measures to ensure increased access to, and training for entrepreneurship for all students, to improve support for entrepreneurship students and graduate entrepreneurs and a planned programme of staff development in entrepreneurship awareness and skills. The strategic planning document (i.e. the HEED Plan or the FE Operational Plan) should be supplemented by an operational plan for entrepreneurship detailing the activities and resources proposed in order to support the KEF remit. This plan should be for nineteen months in the first instance, from 1 st January 2004 to 31 st July There after in accord with institutions internal planning cycle, operational plans will be submitted on an annual basis. As part of the ongoing evaluation of KEF, institutions will be asked to contribute to a biennial audit of Entrepreneurship. 9

10 3.3 Eligible Expenditure Staff Costs Staff hours given to the KEF project (whether dedicated Full Time to KEF, or occasional Part Time work for KEF) may be claimed. Eligible Staff Costs could include:- Development and Lecturing Staff salaries Managers of elements of KEF, lecturing staff who develop and/or deliver pilot training material or who replace staff undertaking staff development activities. Administrative Staff salaries Administrative, clerical and secretarial staff who provide support for KEF. Overtime Overtime will only be paid where an institution has actually paid out the cost for KEF related work over and above the normal contracted hours. Staff Recruitment Costs Time spent interviewing and inducting KEF funded staff and cost of advertisements which carry the appropriate logos. Staff Travel and Subsistence Costs The costs of travel on KEF related business including the cost of refreshments (no alcohol) and hotel accommodation can be claimed providing they are supported by signed and approved travel claims, car parking receipts, hotel invoices etc. Institutionally agreed default mileage rates, daily subsistence rates, ceilings on the cost of hotel accommodation etc. apply. For the avoidance of doubt, expertise bought in from outside (Contract Services) would be classed as Other Costs. 10

11 Methodologies The following paragraphs explain the method for charging staff costs in each of these instances. Individuals employed Full Time (100%) on KEF (Project Specific) For individuals employed full time on KEF (Project Specific) it is acceptable to charge actual salary costs plus actual on costs (i.e. employers NI including rebate if applicable and employers superannuation) as recorded each month in the payroll. Time sheets will not be required to support hours worked on the project, however the following checks will be undertaken to ensure that an individual is 100% KEF (Project Specific):- The contract of Employment will be reviewed to ensure that a person is 100% KEF (i.e. the contract complies with the criteria). A review of the personnel records to ensure that the individual has not undertaken non-kef work. A review of the individuals expenses to confirm that the individual has not incurred expenses on non-kef work. A review of personal diaries or computerised work schedules. Should there be any evidence that an individual is not 100% KEF, then the individual will have to retrospectively account for their time by completing time sheets, derived from time recording methods such as diaries etc. Please note that KEF will reimburse: The maternity benefit entitlement of a full time member of staff or the salary of their replacement, but not both. The sick pay entitlement of a full time member of staff or the salary of their replacement but not both. (NB: Sick Pay of up to and including 10 working days can be reimbursed). The entry into ipm should read as follows:- Hours Worked = 1 Hourly Rate = monthly payroll cost Total (calculated by ipm) = monthly payroll cost Please ensure the payroll amounts are obtained on, at least, a quarterly basis to coincide with the claim periods. NB: Payroll amounts will change as a result of variations such as incremental salary increases, inflationary salary increases, changes in National Insurance rates (this occurs every tax year) etc. Therefore, it is essential that these changes are reflected in the staff time cost to ensure that the amounts claimed from KEF are consistent with the actual payroll expenditure. 11

12 Individuals employed Full Time (100%) on KEF (Several Projects) Claims for staff who are 100% funded from KEF, but are not project specific, i.e individuals who work hours for different KEF projects, must be supported by a signed and approved global time sheet. This time sheet must clearly highlight each project reference and the time must be clearly allocated to each specific project. Overtime will not be paid unless it has been actually paid out by the institution, and therefore, the time sheets must be limited (in the absence of overtime) to the actual contracted hours ( Usually 7.5 hours per day). Approved staff time sheet templates can be downloaded from the KEF website (at although you may use an institutional equivalent providing it captures the same data. The time sheet must provide a good description of the activity undertaken, and should be completed on a monthly basis. It is not sufficient for the description to state KEF or KEF Admin. It is recommended that the time sheet illustrates as a minimum:- The date the work was undertaken The number of hours spent on the activity (to the nearest hour) The relevant project number to which the time is related. A good description of the activity undertaken Time sheets must be signed by the relevant member of staff and approved by the relevant authority (e.g. project manager or EC). Claims for staff working Full Time (100%) for KEF (Several projects) will be based on the following:- Contracted hours: Total number of hours contracted to work (normally 7.5 hours per day) on KEF and confirmed by time sheets. Default hourly rate: The default hourly rate must be calculated as follows:- Annual gross salary plus on costs (employers NI minus rebate, superannuation) Total hours available to work (260 days minus annual and public holiday entitlement multiplied by the number of hours required to work each day) Multiply the result by the number of hours given to the project and this is the amount to be claimed from KEF via ipm. NB: If they work part time or leave during the year, work out their reduced number of hours. Please ensure these rates are re-visited on, at least, a quarterly basis, to coincide with the claim periods, when details should be checked for each month during that quarter. 12

13 Hourly rates will change as a result of payroll variations such as incremental salary increases, inflationary salary increases, changes in National Insurance rates (this occurs every tax year) etc. Therefore, it is essential that these changes are reflected in the hourly rate to ensure that the amounts claimed from KEF are consistent with the actual payroll expenditure. Individuals working Part Time on KEF Claims for staff who are not 100% funded from KEF, i.e. individuals who work occasional hours for KEF, must be supported by signed and approved timesheets. Approved staff time sheet templates can be downloaded from the KEF website (at although you may use an institutional equivalent providing it captures the same data. The time sheets must provide a good description of the activity undertaken. It is not sufficient for the description to state KEF or KEF Admin. It is recommended that the time sheet illustrates as a minimum:- The date the work was undertaken The number of hours spent on the activity (to the nearest hour) The relevant project number to which the time is related. A good description of the activity undertaken Time sheets must be signed by the relevant member of staff and approved by the relevant authority (e.g. Project manager or EC). Claims for staff working Part Time for KEF will be based on: Hours worked: Total number of hours actually worked on KEF and confirmed by timesheets. Default hourly rate: The default hourly rate must be calculated as follows:- Annual gross salary plus on costs (employers NI minus rebate, superannuation) Total hours available to work (260 days minus annual and public holiday entitlement multiplied by the number of hours required to work each day) Multiply the result by the number of hours given to the project and this is the amount to be claimed from KEF via ipm. NB: If they work part time or leave during the year, work out their reduced number of hours. Please ensure these rates are re-visited on, at least, a quarterly basis, to coincide with the claim periods, when details should be checked for each month during that quarter. Hourly rates will change as a result of payroll variations such as incremental salary increases, inflationary salary increases, changes in National Insurance 13

14 rates (this happens every tax year) etc. Therefore, it is essential that these changes are reflected in the hourly rate to ensure that the amounts claimed from KEF are consistent with the actual payroll expenditure. Staff Cost related KEF Records All payroll records, timesheets, working papers (e.g. methodology for the calculation of the staff hourly rate), contracts of employment etc. must be kept on file in accordance with European requirements. Due to the sensitive nature of this material, it is acceptable to keep such records in the Finance/Personnel Department instead of in KEF project files. However, such records must be made available for audit purposes. Other costs Costs, in the categories described below, incurred in the delivery of the KEF Operational Plan may be claimed, provided they are supported by paid invoices or from invoices you know will be paid i.e. they have been approved for payment by the relevant authority. VAT paid on items and services can be included in the amounts claimed from KEF if the institution cannot later recover all or part of the VAT paid from Customs and Excise. VAT which is recoverable, refunded or offset by whatever means cannot be considered eligible, and therefore cannot be part financed by the Structural Funds. VAT liability on the purchase of items / services may vary even within your own institution so it is therefore essential that KEF obtains a declaration from the Director of Finance (or equivalent) of each FE & HE institution, which clearly states the VAT status of the institution. Institutions with partial exemption status will need to provide KEF with the agreed partial exemption rate applicable to financial year 2003/4 initially and for 2004/5 and 2005/6 where sub-project activity continues and the new rate of partial exemption is known. Advertising and promotion The cost of producing publicity and promotional materials for the project. Consumables The cost of any item consumed within the life of the project e.g. light refreshments for meetings (with the exception of alcohol), limited-life training materials. Depreciation of Owned Equipment Depreciation of items you buy or already own which are necessary for the project unless it has been previously claimed from an ESF project. You may calculate depreciation of the total cost (including irrecoverable VAT) of the item over three years from the date of purchase. 14

15 Equipment items < 1,000 You may claim the full cost of items necessary for the project, which cost no more than 1,000 (including irrecoverable VAT). You may claim for any number of items within this cost limit. N.B. This does not include ICT equipment for students resource or drop-in centres which must be funded from alternative sources. Operating Equipment lease costs You may claim for the cost of hiring a piece of equipment for the project provided it remains the property of the person who leases the equipment to you. Telephone/Postage/ Fax/ Stationery/Office supplies You may claim these costs provided they are directly attributable to the project, you cannot claim for apportioned or estimated costs. Professional fees You may claim for services provided to the project by external contractors on condition that they were selected following competitive tender. Room hire You may claim the cost of hiring training and/or meeting rooms where suitable alternatives on site are not available. Expenditure Records The following records must be retained in order to support expenditure. This list is not necessarily exhaustive and if in doubt, you should always retain all documentation. Staff Time Sheets for staff working part time on KEF projects, time sheets must be kept showing time spent on the project and all time (part time only) spent on other activities (the latter need not be itemised unless required elsewhere). For staff working full time on various KEF projects, time sheets must be kept on a monthly basis that clearly shows all time spent between each separate project. Staff working full time on a specific KEF project need not keep time sheets, however, proof of employment such as recruitment adverts, job descriptions and other related documentation should be retained. Staff Travel and Subsistence claims for staff who have incurred costs for KEF related activities. Normal institutional records should be retained including all receipts. Order and Invoice Records for purchases made must be retained on file to support project costs. Tender Documentation for larger purchases and the procurement of external expertise, showing conformance with the tendering policy of the institution. Full EU procurement must be followed. Telephone and Fax Records should be retained on the project files. 15

16 Only costs that can be clearly identified as being associated with the project can be claimed. Apportionment is not eligible. Internal (Institutional) Re-Charge Records such as Postage, Photocopying, Stationery etc. should be retained on the project files. Any internal recharges must be clearly identifiable as being associated with KEF (such as a charge to the KEF finance code) and/or authorised by the relevant supplying department. Payroll/Personnel Records must be retained to support any Staff Costs. Due to the sensitive nature of this information, it is acceptable to keep this information within the Finance/Personnel Department. Methodology for calculating staff time costs must be retained to support the staff time recharged to KEF. Activity Records Beneficiary Enrolment Forms to be completed for each individual beneficiary. Beneficiary Time Sheet to be completed with number of hours of support a beneficiary has received from the project. Beneficiary Evaluation and Destination Form to be completed when evaluating the effectiveness of the activity with the beneficiary. 16

17 3.4 Beneficiaries KEF beneficiaries for the Entrepreneurship Strategy are either students of the institution or institutional staff. A Beneficiary is somebody taking part in an ESF-funded project who is legally resident in Britain. Beneficiaries must satisfy some fundamental ESF eligibility conditions before being supported by the KEF project. ESF eligibility should be established as follows: Eligibility of individuals To be eligible for KEF support an individual must: be aged 16 years+ if employed, work in the same objective area in which the institution is located or if unemployed, live in the same objective area in which the institution is located. Unitary authorities in the Objective 1 area: Isle of Anglesey, Gwynedd, Conwy, Denbighshire, Ceredigion, Pembrokeshire, Carmarthenshire, Swansea, Neath Port Talbot, Bridgend, Rhondda Cynon Taff, Merthyr, Caerphilly, Blaenau Gwent, Torfaen. Other unitary authorities in Wales will be in the Objective 2 or 3 areas. If you are working with beneficiaries outside your Objective area please contact the KEF office for advice on how to access funds from the appropriate source. not have benefited from an ESF supported programme for more than 3 consecutive calendar or academic years. complete appropriate supporting documentation to establish the eligibility of themselves and the supported activity they are undertaking (see page 15). Beneficiary Records Each institution must complete and retain specific records (signed by the beneficiary and approved by a senior member of the project staff) for each type of beneficiary, both staff and students. WEFO has developed a set of ESF approved templates for recording beneficiary activity (available to download from the KEF web site at www. Kef-wales.org.uk) or you can develop/adapt your own institutional equivalents provided they capture the same data. Record Keeping The European Commission requires complete and comprehensive record keeping. Full records to support claims for expenditure must be kept as well as records showing progress against targets. 17

18 Retention of Documents European regulations require that supporting documents relating to the implementation of ESF assistance in all projects is retained for a period of three years following the final payment made by the European Commission for each programme. The deadline for the final payment by the Commission for your project is 31 December 2008 and the documents relating to the implementation of your project should be retained until 31 st December The European Commission has recently provided clarification on the form in which documents can be retained. Documents must be retained either as original or on the following data carriers: Photocopies of original documents Microfiches of original documents Electronic versions of original documents on optical data carriers (such as CD-ROM. Hard disk or magnetic disk Documents existing in electronic format only 3.5 Application Process The institutional strategy should be supported by an operational plan developed in the first instance for nineteen months from the 1 st January 2004 to 31 st July The plan should detail the activities and resources required to support and deliver the strategy. Subsequent plans will be submitted on an annual basis in line with the normal planning cycle of the sector. An application form is available from the KEF website at under resources in the publications page, and is the recommended template for entrepreneurship operational plans. This can be completed online and printed off for signature by the institutions Principal or Vice Chancellor and Entrepreneurship Champion. Completed, signed operational plans should be sent to the Swansea office: ELWa South West Wales Tyr Llyn Waterside Business Park Clos Llyn Cwm Swansea Enterprise Park Swansea SA6 8AH NOTE: Only signed plans submitted by the due dates will be considered. 18

19 3.6 Assessment Process Stage 1 For FEI the institutions operational plan is assessed by the provision development manager and the relevant ELWa regional office and comments forwarded to KEF Swansea Office. For HEI, HEED plans are assessed by HEFCW and comments on the Entrepreneurship Strategy logged with the KEF Swansea office. Stage 2 Operational plans are submitted to KEF Swansea office and are reviewed by the Entrepreneurship Champion and the ESF Project Manager. Stage 3 Assessment of the plans by a panel drawn from KEF Steering Group Members and including representatives from the WDA Entrepreneurship action plan. All comments on the strategies and plans are taken into account and funding is assigned to support the plan. The panels are chaired by the KEF Director with the ESF Project Manager and Entrepreneurship Champion attending in an advisory position. Notification of the panel s decision is sent by letter to Heads of Institutions and Entrepreneurship Champions within one week of the panel. 19

20 4. STRATEGY FOR INNOVATION 4.1 Introduction In order to build capacity within institutions for the support and development of innovation, institutions are asked to indicate their commitment to innovation through their strategic planning process. Within Higher Education Institutions this will be demonstrated in the HEED plan and for Further Education Institutions it will be demonstrated in the institutions operational plan. The commitment should include measures, to develop and implement institution wide ipr policies for both staff and students, development of resources to support knowledge application and exploitation, and the development of staff involved in commercial activities and services, to ensure longer progression, and a long term approach to the support of innovation in the institutions. 4.2 Institution Operational Plan Annual operating plans submitted as application for KEF support will be assessed for the extent to which they support the aim of KEF i.e: To build the capacity of FEIs and HEIs to meet the learning needs of SMEs by supporting strategic plans for the development of innovation, science and technology related training resources at NVQ levels 3-5 or equivalent. Capacity-building activities in FEIs and HEIs could include: Enhancing/updating the institution s knowledge of the local SME market. Much will already be available from the institution s commercial, business development and academic departments. Much will be available from other agencies and industry representatives such as the WDA, Federation of Small Businesses, Community Consortia for Education and Training, Sector Skills Councils and professional associations. It may be necessary to gather intelligence directly from local SMEs by undertaking training needs analyses. Enhancing/updating the knowledge and skills of staff involved in delivering the KEF remit e.g. technological advances and innovations in process and production management, developing customised training resources for SMEs, alternative training delivery methodology appropriate for SMEs, consultancy skills. Establishing/developing contacts with employer networks to - for example - pilot developed training resources, develop joint initiatives etc. Developing and piloting high level, customised training resources to meet the innovation, science and technology related needs of SMEs. Augmenting the institution s equipment resources to be used to meet the high level, innovation, science and technology related learning needs of SMEs. 20

21 Developing an institutional culture (i.e. policies and behaviours) that will support and encourage engagement with innovative SMEs. Measurable outcomes Annual operating plans submitted as applications for KEF support must include quantitative and qualitative targets that can be used by institutions and the KEF team to monitor progress during the operating period. Targets should realistically reflect the institution s capability to implement the institution s strategic plans for Innovation within the current year. Therefore institutions will not be asked to set targets at minimum levels in any category unless the total offered by all institutions in the Objective area do not reach projections agreed by KEF in order to secure European Social Funds. It is accepted that measurable outcomes can only be projected at the beginning of an operating year but institutions are encouraged to use projections to monitor actual performance at regular intervals throughout the year. Please notify the KEF team where targeted outcomes need to be adjusted as plans are periodically reviewed. The KEF team will also monitor actual performance against projections when quarterly claims for reimbursement are submitted and will require institutions to make adjustments where the variance is in excess of 15%. 4.3 Eligible Expenditure Staff Costs Staff hours given to the KEF project (whether dedicated Full Time to KEF, or occasional Part Time work for KEF) may be claimed. Eligible Staff Costs could include:- Development and Lecturing Staff salaries Managers of elements of KEF, lecturing staff who develop and/or deliver pilot training or who replace staff undertaking staff development activities. Administrative Staff salaries Administrative, clerical and secretarial staff who provide support for KEF. Overtime Overtime will only be paid where an institution has actually paid out the cost for KEF related work over and above the normal contracted hours. Staff Recruitment Costs Time spent interviewing and inducting KEF funded staff and cost of advertisements which carry the appropriate logos. 21

22 Staff Travel and Subsistence Costs The costs of travel on KEF related business including the cost of refreshments (no alcohol) and hotel accommodation can be claimed providing they are supported by signed and approved travel claims, car parking receipts, hotel invoices etc. Institutionally agreed default mileage rates, daily subsistence rates, ceilings on the cost of hotel accommodation etc. apply. For the avoidance of doubt, expertise bought in from outside (Contract Services) would be classed as Other Costs. Methodologies The following paragraphs explain the method for charging staff costs in each of these instances. Individuals employed Full Time (100%) on KEF (Project Specific) For individuals employed full time on KEF (Project Specific) it is acceptable to charge actual salary costs plus actual on costs (i.e. employers NI including rebate if applicable and employers superannuation) as recorded each month in the payroll. Time sheets will not be required to support hours worked on the project, however the following checks will be undertaken to ensure that an individual is 100% KEF (Project Specific):- The contract of Employment will be reviewed to ensure that a person is 100% KEF A review of the personnel records to ensure that the individual has not undertaken non-kef work. A review of the individuals expenses to confirm that the individual has not incurred expenses on non-kef work. A review of personal diaries or computerised work schedules. Should there be any evidence that an individual is not 100% KEF, then the individual will have to retrospectively account for their time by completing time sheets, derived from time recording methods such as diaries etc. Please note that KEF will reimburse: The maternity benefit entitlement of a full time member of staff or the salary of their replacement, but not both. The sick pay entitlement of a full time member of staff or the salary of their replacement but not both. (NB: Sick Pay of up to and including 10 working days can be reimbursed). The entry into ipm should read as follows:- Hours Worked = 1 Hourly Rate = monthly payroll cost 22

23 Total (calculated by ipm) = monthly payroll cost Please ensure the payroll amounts are obtained on, at least, a quarterly basis to coincide with the claim periods. NB: Payroll amounts will change as a result of variations such as incremental salary increases, inflationary salary increases, changes in National Insurance rates (this occurs every tax year) etc. Therefore, it is essential that these changes are reflected in the staff time cost to ensure that the amounts claimed from KEF are consistent with the actual payroll expenditure. Individuals employed Full Time (100%) on KEF (Several Projects) Claims for staff who are 100% funded from KEF, but are not project specific, i.e individuals who work hours for different KEF projects, must be supported by a signed and approved global time sheet. This time sheet must clearly highlight each project reference and the time must be clearly allocated to each specific project. Overtime will not be paid unless it has been actually paid out by the institution, and therefore, the time sheets must be limited (in the absence of overtime) to the actual contracted hours ( Usually 7.5 hours per day). Approved staff time sheet templates can be downloaded from the KEF website (at although you may use an institutional equivalent providing it captures the same data. The time sheet must provide a good description of the activity undertaken, and should be completed on a monthly basis. It is not sufficient for the description to state KEF or KEF Admin. It is recommended that the time sheet illustrates as a minimum:- The date the work was undertaken The number of hours spent on the activity (to the nearest hour) The relevant project number to which the time is related. A good description of the activity undertaken Time sheets must be signed by the relevant member of staff and approved by the relevant authority (e.g. project manager or EC). Claims for staff working Full Time (100%) for KEF (Several projects) will be based on the following:- Contracted hours: Total number of hours contracted to work (i.e. 7.5 hours per day) on KEF and confirmed by time sheets. Default hourly rate: The default hourly rate must be calculated as follows:- Annual gross salary plus on costs (employers NI minus rebate, superannuation) 23

24 Total hours available to work (260 days minus annual and public holiday entitlement multiplied by the number of hours required to work each day) Multiply the result by the number of hours given to the project and this is the amount to be claimed from KEF via ipm. NB: If they work part time or leave during the year, work out their reduced number of hours. Please ensure these rates are re-visited on, at least, a quarterly basis, to coincide with the claim periods, when details should be checked for each month during that quarter. Hourly rates will change as a result of payroll variations such as incremental salary increases, inflationary salary increases, changes in National Insurance rates (this occurs every tax year) etc. Therefore, it is essential that these changes are reflected in the hourly rate to ensure that the amounts claimed from KEF are consistent with the actual payroll expenditure. Individuals working Part Time on KEF Claims for staff who are not 100% funded from KEF, i.e. individuals who work occasional hours for KEF, must be supported by signed and approved timesheets. Approved staff time sheet templates can be downloaded from the KEF website (at although you may use an institutional equivalent providing it captures the same data. The time sheets must provide a good description of the activity undertaken. It is not sufficient for the description to state KEF or KEF Admin. It is recommended that the time sheet illustrates as a minimum:- The date the work was undertaken The number of hours spent on the activity (to the nearest hour) The relevant project number to which the time is related. A good description of the activity undertaken Time sheets must be signed by the relevant member of staff and approved by the relevant authority (e.g. Project manager or EC). Claims for staff working Part Time for KEF will be based on: Hours worked: Total number of hours actually worked on KEF and confirmed by timesheets. Default hourly rate: The default hourly rate must be calculated as follows:- 24

25 Annual gross salary plus on costs (employers NI minus rebate, superannuation) Total hours available to work (260 days minus annual and public holiday entitlement multiplied by the number of hours required to work each day) Multiply the result by the number of hours given to the project and this is the amount to be claimed from KEF via ipm. NB: If they work part time or leave during the year, work out their reduced number of hours. Please ensure these rates are re-visited on, at least, a quarterly basis, to coincide with the claim periods, when details should be checked for each month during that quarter. Hourly rates will change as a result of payroll variations such as incremental salary increases, inflationary salary increases, changes in National Insurance rates (this happens every tax year) etc. Therefore, it is essential that these changes are reflected in the hourly rate to ensure that the amounts claimed from KEF are consistent with the actual payroll expenditure. Staff Cost related KEF Records All payroll records, timesheets, working papers (e.g. methodology for the calculation of the staff hourly rate), contracts of employment etc. must be kept on file in accordance with European requirements. Due to the sensitive nature of this material, it is acceptable to keep such records in the Finance/Personnel Department, instead of in KEF project files. However, such records must be made available for audit purposes. Other costs Costs, in the categories described below, incurred in the delivery of the KEF Operational Plan may be claimed provided they are supported by paid invoices or from invoices you know will be paid i.e. they have been approved for payment by the relevant authority. VAT paid on items and services can be included in the amounts claimed from KEF if the institution cannot later recover all or part of the VAT paid from Customs and Excise. VAT which is recoverable, refunded or offset by whatever means cannot be considered eligible, and therefore cannot be part financed by the Structural Funds. VAT liability on the purchase of items / services may vary even within your own institution so it is therefore essential that KEF obtains a declaration from the Director of Finance (or equivalent) of each FE & HE institution, which clearly states the VAT status of the institution. Institutions with partial exemption status will need to provide KEF with the agreed partial exemption rate applicable to financial year 2003/4 initially and for 2004/5 and 2005/6 where sub-project activity continues and the new rate of partial exemption is known. 25

26 Advertising and promotion The cost of producing publicity and promotional materials for the project. Consumables The cost of any item consumed within the life of the project e.g. light refreshments for meetings (with the exception of alcohol), limited-life training materials. Depreciation of Owned Equipment Depreciation of items you buy or already own which are necessary for the project unless it has been previously claimed from an ESF project. You may calculate depreciation of the total cost (including irrecoverable VAT) of the item over three years from the date of purchase. Equipment items < 1,000 You may claim the full cost of items necessary for the project, which cost no more than 1,000 (including irrecoverable VAT). You may claim for any number of items within this cost limit. N.B. This does not include ICT equipment for students resource or drop-in centres which must be funded from alternative sources. Operating Equipment lease costs You may claim for the cost of hiring a piece of equipment for the project provided it remains the property of the person who leases the equipment to you. Telephone/Postage/ Fax/ Stationery/Office supplies You may claim these costs provided they are directly attributable to the project, you cannot claim for apportioned or estimated costs. Professional fees You may claim for services provided to the project by external contractors on condition that they were selected following competitive tender. Room hire You may claim the cost of hiring training and/or meeting rooms where suitable alternatives on site are not available. Expenditure Records The following records must be retained in order to support expenditure. This list is not necessarily exhaustive and if in doubt, you should always retain all documentation. Staff Time Sheets for staff working part time on KEF projects, time sheets must be kept showing time spent on the project and all time (part time only) spent on other activities (the latter need not be itemised unless required elsewhere). For staff working full time on various KEF projects, time sheets must be kept on a monthly basis that clearly shows all time spent between each separate project. 26

27 Staff working full time on a specific KEF project need not keep time sheets, however, proof of employment such as recruitment adverts, job descriptions and other related documentation should be retained. Staff Travel and Subsistence claims for staff who have incurred costs for KEF related activities. Normal institutional records should be retained including all receipts. Order and Invoice Records for purchases made must be retained on file to support project costs. Tender Documentation for larger purchases and the procurement of external expertise, showing conformance with the tendering policy of the institution. Full EU procurement must be followed. Telephone and Fax Records should be retained on the project files. Only costs that can be clearly identified as being associated with the project can be claimed. Apportionment is not eligible. Internal (Institutional) Re-Charge Records such as Postage, Photocopying, Stationery etc. should be retained on the project files. Any internal recharges must be clearly identifiable as being associated with KEF (such as a charge to the KEF finance code) and/or authorised by the relevant supplying department. Payroll/Personnel Records must be retained to support any Staff Costs. Due to the sensitive nature of this information, it is acceptable to keep this information within the Finance/Personnel Department. Methodology for calculating staff time costs must be retained to support the staff time recharged to KEF. Activity Records Beneficiary Enrolment Forms to be completed for each individual beneficiary. Beneficiary Time Sheet to be completed with number of hours of support a beneficiary has received from the project. Beneficiary Evaluation and Destination Form to be completed when evaluating the effectiveness of the activity with the beneficiary. Company Enrolment Form to be completed when an SME or supply chain company has been assisted. 3.4 Beneficiaries KEF beneficiaries for the Entrepreneurship Strategy are either students of the institution or institutional staff. A Beneficiary is somebody taking part in an ESF-funded project who is legally resident in Britain. 27

28 Beneficiaries must satisfy some fundamental ESF eligibility conditions before being supported by the KEF project. ESF eligibility should be established as follows: Eligibility of individuals To be eligible for KEF support an individual must: be aged 16 years+ if employed, work in the same objective area in which the institution is located or if unemployed, live in the same objective area in which the institution is located. Unitary authorities in the Objective 1 area: Isle of Anglesey, Gwynedd, Conwy, Denbighshire, Ceredigion, Pembrokeshire, Carmarthenshire, Swansea, Neath Port Talbot, Bridgend, Rhondda Cynon Taff, Merthyr, Caerphilly, Blaenau Gwent, Torfaen. Other unitary authorities in Wales will be in the Objective 2 or 3 areas. If you are working with beneficiaries outside your Objective area please contact the KEF office for advice on how to access funds from the appropriate source. not have benefited from an ESF supported programme for more than 3 consecutive calendar or academic years. complete appropriate supporting documentation to establish the eligibility of themselves and the supported activity they are undertaking (see page 15). Beneficiary Records Each institution must complete and retain specific records (signed by the beneficiary and approved by a senior member of the project staff) for each type of beneficiary, both staff and students. WEFO has developed a set of ESF approved templates for recording beneficiary activity (available to download from the KEF web site at www. Kef-wales.org.uk) or you can develop/adapt your own institutional equivalents provided they capture the same data. Record Keeping The European Commission requires complete and comprehensive record keeping. Full records to support claims for expenditure must be kept as well as records showing progress against targets. Retention of Documents European regulations require that supporting documents relating to the implementation of ESF assistance in all projects is retained for a period of three years following the final payment made by the European Commission for each programme. The deadline for the final payment by the Commission for your project is 31 December 2008 and the documents relating to the implementation of your project should be retained until 31 st December