Equipment and Goods
Equipment refer to durable items that can be used multiple times over their estimated economic useful lifespan.
They comprise both support equipment, intended to assist the implementation of the Action, and operational equipment, intended for the direct benefit of the beneficiaries.
New or second-hand equipment used for the Action may be charged under the following options:
- depreciation rate
- rental cost
- lease cost
- full purchase price
It is used if the Partner has purchased the equipment using its own funds.
Conditions: The rates taken into account have to be recorded in the accounting statements and have to be in line with:
- partner usual accounting practices;
- the applicable national legalisation where the partner is established;
- international accounting standards;
- the principle of economy and efficiency;
- the principle of proportionality (only the portion of the actual use is taken into account).
When the partners collaborate with implementing partners which are FPA partners, the FPA partners can use their own depreciation rates.
Where the durable equipment belongs to an implementing partner which is not a FPA signatory, the implementing partner should use a depreciation rate and methodology which is at least comparable or consistent with the one used by the partner for durable equipment in that Action. This is to avoid having different depreciation rates applied in the same Action which would be hard to reconcile or justify.
When applicable depreciation procedures allow an accelerated depreciation in emergency contexts, ECHO expects that the depreciated equipment will be used in subsequent actions.
Depreciation rules apply to second hand equipment, provided that the appropriate actual useful life of the asset is taken into account.
If the durable equipment was bought using donor funding during a previous Action and in cases where a donor has already paid or co-financed 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 these cases, it may still possible to charge the maintenance and running costs of that durable equipment to the Action's budget.
Rental costs of equipment are eligible.
Conditions: only the portion of the equipment's rental costs, corresponding to the rate of actual use for the purposes of the Action is taken into account and the adequate procurement procedures have been respected.
To know more, see also the FAQs nr. 89
Lease costs of equipment are eligible.
Conditions: these costs are exclusive of any finance fee and only the portion of the equipment's lease costs, corresponding to the rate of actual use for the purposes of the Action is taken into account.
Purchase costs of equipment are eligible.
Conditions: they respect the procurement eligibility conditions and the rules about their disposal at the end of the action.
- Equipment purchased towards the end of the action is in most cases considered as not necessary for the Action and will be declared ineligible unless duly justified operationally.
- Stationary has to be considered as equipment, and, as a general rule, has to be included in indirect costs or field office costs. Stationary items necessary for a specific activity (e.g. for a training for beneficiaries) are eligible as direct costs.
- As concern stocks, please refer to this page
Goods refer to items intended for direct consumption or use by the beneficiaries including nondurable items and consumables.
The costs are eligible when the good is directly assigned to the Action, including costs related to transport, storage and distribution, provided they respect the procurement conditions and the rules about their disposal at the end of the action.
Information on goods have to be provided in the Single Form in Section 6.3
References & useful links