Dear Dr Maistrello,
Thank you for the supplementary information you sent to INTAS in relation to the report for the above infrastructure action. There appears to be some confusion as to the need to provide additional information. This was motivated by the fact that the contract is based on Actual Cost and not Fixed Cost. Thus, under the terms of Articles 18, 19 and 20 of the General Conditions applicable to this contract INTAS reimburses only those costs which are actually incurred in the execution of the work during the period of the contract. To do so we need to know the actual expenditure under the different cost headings, where necessary (such as with equipment) with some detail. In your report of the 31 st May you justify in table 1 on page 5 the expenditure of 141,233 Euro, most of which is equipment and labour specified in detail in your earlier report. Such justification is therefore adequate.However, you then go on to say that you still have 20,767 Euro in hand and give an indicative breakdown of what you may do with this and the residual maximum of 18,000 Euro which could be paid under the contract. Thus for about 20% of the total budget we have an estimate and not the actual cost. For a final report of an Actual Cost contract such a situation is not acceptable since we only reimburse the costs actually incurred. This is why I asked Dr Vardapetian to obtain the necessary information to justify that this money had been spent during the lifetime of the contract. Given the current finanicial situation in the NIS, I am of course willing to accept estimates for that part of the money still to be paid to enable things to be finalized. Where this involves equipment quotations should be obtained to assess the actual amount. Please note at this point that there is no money blocked at the General Bank: what happened was that INTAS paid the supplier the actual cost of the equipment supplied. The difference between this amount and that returned from Moscow remained available for use under the terms of the contract if it could be justified. As I am sure that you will appreciate, as we are speaking of public money, for which we will have to give an account to our auditors and Management Board, we have to be prudent whilst at the same time as flexible in the light of the difficult situation in the NIS. To do so we need to apply the contract rules for what is one of our largest projects without resorting to requesting actual invoices, as would be the case if we decide to audit a project. For my part I have asked Dr Vardapetian to review in detail all the information supplied to determine the total amount payable under the contract as opposed to just paying the maximum specified in the contract. Contrary to what Prof Yurov wrote in his e-mail of the 6 September, we have no interest in decreasing the total amount payable but merely seek to assure that the correct amount is paid in fairness to all those who seek INTAS funds,

Yours sincerely,
Dr David Gould
Head of the INTAS Secretariat