Conditions for the eligibility of costs

Conditions for the eligibility of costs

Article 19 of the General Conditions defines the mandatory principles that have to be respected for the cost to be considered eligible.
In order to be eligible costs must be:


The costs must be necessary for carrying out the Action, meaning that they are directly attributable to the Action and arise as a direct consequence of its implementation;


Meaning that they are real costs borne by the UN Agency;

Incurred during the eligibility period of the Action

The eligibility period of the Action is set out in Article 2.3 of the Delegation Agreement. This means that:
a) in case of services and works, they relate to activities performed during the eligibility period of the Action,

b) in case of supplies, the costs should relate to supplies distributed/made available to the beneficiaries during the eligibility period of the Action.

The only exceptions to this rule regard the costs incurred for the

  • preparation of the Final Report, up to a maximum of 1 full time staff for the period of the Final Report specified in the IMDA + the overhead linked to the work of this staff.
  • the costs of post-distribution monitoring: for the staff in charge and related running costs
  • and the costs of final evaluation of the Action.

These costs shall be deemed eligible, even if incurred after the eligibility period of the Action;

Reasonable, justified, and comply with the principle of sound financial management

This principle means that the budget of the Action must be used in accordance with the principles of economy and efficiency.

  • The principle of economy requires that the resources used in the pursuit of an activity be made available in due time, in appropriate quantity and quality and at the best price.
  • The principle of efficiency refers to the best relationship between resources employed and results achieved.

Throughout the Action, the UN Agency will have to make sure that this principle is respected. At the end of the Action, in cases where this principle could not be respected, the UN Agency will have to justify the reasons and the impact on the result.

Identifiable, Verifiable and backed by supporting evidence

The costs must be recorded in the accounting records of the UN Agency, and must comply with the accounting standards of the UN Agency. The costs should also be backed by supporting evidence. (e.g. invoice, receipts, agreements, time-sheet, etc).

Covered by the budget of the Action

This requirement means that all the costs must be included in the overall budget of the Action distinguishing, to the extent possible, the costs of Budget Implementation Tasks.
It does not mean that all those costs will be “visible” in the financial statement as the financial statement presents only the costs up to a certain level (level 3). Eventually, all the costs that will be presented in the ledger at Final Report stage must fall into one of the budget headings presented on the Financial Statement annexed to the Single Form.

Compliant with the requirements of applicable tax and social legislation

The UN Agency must comply with the applicable tax and social legislation e.g. the legislation of the country of registration of the UN Agency and of the country of implementation.