WORKING WITH DG ECHO AS AN NGO FPA
Depreciation or rental costs for the use of durable equipment may be charged to the ECHO Action in proportion to its actual use as long as the rules on eligibility in Article 10.2 (a) are observed. This possibility applies regardless of who owns the durable equipment as long as it was necessary for use in the ECHO funded Action and the normal financial safeguards were ensured.
Where the durable equipment belongs to an Implementing Partner who is not an FPA Signatory itself that Implementing Partners should use a rental/depreciation rate and methodology which is at least comparable or consistent with that (if any) used by the Partner for durable equipment in that Action. This is to avoid having dramatically different rental/depreciation rates applied in the same Action which would be hard to reconcile or justify.
The depreciation/rental costs must be reflected in the accounting system in a consistent and verifiable way.
An important exception to this is if the durable equipment was bought using ECHO Funding. In cases where ECHO has already covered or contributed to the purchase cost of a piece of durable equipment the related depreciation or rental costs can never be charged to a future ECHO funded Action - to do so would be contrary to normal financial safeguards and would constitute double funding.
In cases where it is not possible to charge rent/depreciation to an ECHO funded Action it may still possible to charge the maintenance and running costs of that durable equipment to the Action's budget.
It is possible to charge a depreciation rate related to the local office building. This is different from a mortgage loan, which is not eligible under the General Conditions.
The assessment of the residual economic value will be done at the end of the eligibility period of the Action, when the partner will have to decide on the end use of the equipment fully charged to the Action. To calculate this value, the partner has to simulate the depreciation costs of the equipment as if it was proposed for a depreciation from the date of its purchase until the end of the eligibility period of the Action. This remains the same even if the equipment was used by an Implementing Partner .