Following the definitions of Direct & Indirect Costs (above), you may include HQ staff costs under 'direct costs' only if they:
• Relate to the achievement of the Action's operational results and have accordingly been identified as an operational activity in section 4.3.2 of the Single Form. (e.g.: the preparation of a training module under a capacity building program, or of an awareness raising campaign in a DIPECHO action.); or
• Cover the preparation of the final reports - the salary costs of one person may be charged as a direct cost for the drafting of the final reports (max. 3 months), independent of the actual location of the person drafting the report (in the field or at HQ); or
• Cover the actual presence of HQ staff in the field (e.g. monitoring missions, needs assessment, etc.).
In all other cases, the HQ staff costs cannot be considered as direct costs of an Action - nor can they be charged on a pro rata basis to the action (calculated for instance on the basis of the time HQ staff spent on the concerned activities).
Reference: Articles 18.1 and 18.7 General Conditions
ECHO accepts to finance some HQ costs as direct costs, where these are compliant with the eligibility criteria (FAQ above) and are “identifiable staff costs at headquarters level directly related to the Action”, in addition to the already agreed indirect costs. To avoid the risk of double-funding, for HQ staff costs to be eligible as direct costs they must correspond to costs outside the typical indirect costs.
- For HQ staff costs declared as direct costs and amounting less than 3% of the direct costs, a concise description and justification needs to be provided at final reporting stage.
- For HQ staff costs declared as direct costs exceeding 3% of the direct costs, full details (i.e. names, periods, number of man-hours, amounts and detailed description of the tasks) will need to be provided at final reporting stage.
Reference: Articles 18.1 and 18.7 General Conditions.
The following are examples of HQ costs which may be eligible as direct costs because they are not typical indirect support costs:
• Program/project travel, accommodation, per diem, and incidentals for desk officers.
• Costs associated with program/project final reporting and related administrative costs (e.g. reproduction, translation).
• Procurement of goods specifically required for the execution of the program/project and related shipping costs (e.g. packaging, containers, freight, freight insurance).
• Any other direct costs necessary to implement the program/project which are verifiable and auditable. Prior written approval must be obtained from DG ECHO for the cost to be eligible.
Reference: Articles 18.1 and 18.7 General Conditions.
The following are examples of HQ costs are not eligible as direct costs because they are typical indirect support costs:
• Advertising and promotion (non-program/project specific)
• Amortization/depreciation of headquarter buildings, equipment, furniture etc.
• Bank charges (non-program/project specific)
• Board and headquarter management activities
• Business development activities
• Capital taxes
• Communication costs (non-program/project specific)
• Financing costs such as interest expenses and costs to obtain irrevocable letters of credit
• Headquarter ITC and other maintenance expenses
• Insurance (e.g. office, board of directors, liability)
• Internal or external audits of the organization
• Memberships and subscriptions
• Non-program/project specific office supplies and equipment
• Non-program/project specific rent and utilities
• Non-program/project specific repairs and maintenance expenses
• Organization restructuring costs
• Other indirect/overhead type of expenditures relating to the organization's office(s) in Europe
• Professional fees relating to the administration of the organization (e.g. legal, accounting, etc.)
• Proposal preparation activities
• Review and negotiation of agreements
• Salaries and fringe benefits relating to the administration of the organization
• Staff recruitment (unless specifically linked to a DG ECHO funded Action)
• Staff training
• Strategic planning activities
• Travel (non-program/project specific)
• Workstations, including computers
Reference: Articles 18.1 and 18.7 General Conditions