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									N+3 as a Tool for Strategic
   Fund Management

  LOTHAR - the way it works
            Tsvyatko Velikov
              DG REGIO Bulgaria
        Tsvyatko.Velikov@ec.europa.eu
Key principles to set up the system
   A uniform approach across OPs
   Using same method for all (with a view to
    aggregate data)
   Forecast at the lowest meaningful level
    (considering time and efficiency)
   Forecast as much as possible
   Forecast as far as possible and using your best
    guess
   Freeze the forecast and establish baseline
    monitoring
 The key principles in a diagram

                                          OP level

                                       Priority axis 2..   Priority axis N
              Priority axis 1

               Operation 2..
Operation 1                             Operation N


                   Call 1/ Major project 1
                     -Funds Contracted
                 -Funds paid to beneficiaries
              -Funds certified to the Commission

                   Call 2/Major project 2...


                    Call 3/Major project 3...
    The elements of LOTHAR
 Flashsheets for the state of play
 N+3 sheets for the forecast
             Flash sheets
3  core indicators: contracting, payment,
  certification
 Sub-indicators for each of the core
  indicators
 Sub-indicators are different for calls and
  for major projects
 30 columns and 70 rows – printable in A3
An overview of the Flash sheet
 OP                 Calls         Project        Contracts     Payments      Certificati
      structu       specificati   selection      performan     performan     on
      re            on            projects       ce projects   ce            performan
                    budget, EU    received       contracted,   Total paid,   ce
                    funds,        /selected/to   total         EU share,     Total
                    interventio   tal budget     budget,       forecast      certified,
                    n rate                       forecast                    EU share,
                                                                             forecast
 Operation 1 -n


 Call 1-n




 Major project 1-
     n

 Works Contract
     1-n
              N+3 Sheets
 The  Commitment profile and the N+3
  profile are based on the total OP
  allocations. These targets are imposed.
 The contracting, payment and certification
  forecast are established by e.g. the MA
 Indicators measure the real contracting,
  payment and certification performance
 Charts and 120 excel sheets for each OP
  and priority axes
An overview of an OP N+3 sheet
           Commitment   N+3/2     Contracts      Payments       Certification
           profile      profile   forecast and   forecast and   forecast and
                                  performance    performance    performance


QI 2007




QII 2007




….




IV/2015
Analysis of the flash
       sheet
      a case study
    The analysis of the Flash Sheet -
              contracting
The grid of the Flash Sheet follows
   the project cycle, both for calls
   and projects. The analysis allows
   to establish:
 The pipeline for calls (could also
   be projects):
        When are the next calls; what are
         the deadlines for submission of
         projects?
   The pipeline for project contracting
        When does project selection
         start?+ How many proposals?
         How complex is evaluation? How
         complex is the negotiation of
         contracts? How long does it take
         to transform some project
         proposals into contracts? (i.e.
         award of financing)
 The analysis of the Flash Sheet –
    payment and certification
 The   pipeline for payments
     What are the provisions for advance
      payments, re-imbursements and final
      payments
 The   pipeline for certification
     How long does it take to process a bill, from
      submission by Beneficiary to submission of
      certifications of expenditure to the European
      Commission
                      Forecasting
         An example: 1 January 2009 forecast
             10 million € call for proposals
 Call deadline: 31 January 2009
 500 projects anticipated (jungle drums) = more
  than expected. Only 100 can be financed
 Project selection in two phases: technical +
  quality. Result only when all projects evaluated.
  Originally expected 2 month, now 3 month, i.e.
  30 April
 Contract negotiation easy, while standardised
  contract + no major eligibility question. Contracts
  can be signed gradually: 25 contracts per week,
  100 contracts signed 31 May
                         Forecasting
            An example: 1 January 2009 forecast
                10 million € call for proposals
   No certifiable advance payments. Project selection
    based on mature documents (e.g. building permits;
    tender documents). Tendering needed, but small scale:
   Average 3 months from award of contract to tender
    result
   first bills expected from Beneficiaries 5 months after
    contracting
   First bills available for estimated 20% of project value,
    for estimated 25% of all projects having reached this
    stage (the rest are delayed) by 31 October
 Expected expenditure 31 October = 5 million €
 Expected certification submission 3 months later = 31
  January 2010

								
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