Programme Funds
To carry out the Programme, an overall financing of  38,734.43 Euro has been allocated, subdivided per Expenditure Items as in the table below (in Euro):

Table:Programme Funds

Table: Tranches’ System

Tranche	Amount (€)
GRANT
I	5.681.025,89
II	3.000.000,00
III	2.681.025,89
IV	2.582.284,50
SOFT LOAN
I	5,164,568.99
II	7,746,853.49
III	7,746,853.49
IV	2,582,284.50

The Programme grant funds shall be deposited via subsequent installments in a Special Current Account opened by MOFCOM via CICETE in the selected Bank of China. The soft loan financing shall be deposited via subsequent installments on another dedicated bank account opened by MOF in the Pudong Development Bank (see table above).
The funds shall be used for the financing of the Programme activities foreseen in the MOU and in the project documents: training, equipment, PPMO operational costs, technical assistance, procurement, and auditing and CICETE fees.
It shall not be considered eligible for funding:

According to the grant Agreement, grant funds shall be used for the purchase of training and technical assistance services (at least 70% of the grant component) and equipment pertaining to the approved projects.
The procurement of those services, civil works and goods shall be restricted, for an amount of at least 80%, (i) to qualified Italian entities, including Italian Universities and Italian NGOs recognized by MAE / DGCS, with proven experience in specialized vocational training, school management or employment services management (depending on the nature of the contract), or (ii) to consortia composed and led by at least one of such entities.
The correct application of what stated in the MOU will be audited by the DELOITTE, Auditing Company selected through international tender by MOFCOM to assure that all aspects of Grant financed Programme activity will be conducted in accordance with the Agreement.

According to the soft loan Agreement, the soft loan funds shall be used for the purchase of equipment (at least 70% of the soft loan component of the Programme); the remaining 30% will be used for civil works and technical assistance pertaining to the approved projects.
The procurement of goods and services will be restricted to Italian companies or consortia of Italian companies, while the procurement of civil works will be restricted to Chinese companies. No more than 40% (forty per cent) of the entire Soft Loan may be used to purchase goods, services and works having their origins in China or third countries.
The correct application of what stated in the MOU will be audited by the National Audit Office of the PRC, Auditing Company appointed by MOF to assure that all aspects of soft loan financed Programme activities will be conducted in accordance with specific terms of the Agreement.
The civil works will be awarded separately from the goods and shall be tendered and governed by the principles of the Practical Guide to contract procedures for EC external actions - 2006 edition. The bidding documents for tendering the civil works will be based on the tender document, ‘Civil Works Model Bidding Document’, utilized by the Chinese Government for awarding construction works contracts.

Projects Budget
The Programme’s funds are almost equally divided between the two provinces and are attributed to the final beneficiaries depending on their needs, dimension and financial conditions.
The budget included in each project document presented by the schools specifies the funds committed to the implementation of the project. Once the NMC issues its “no objection”, the budget becomes legally bound and sets the financial limit for project activities.
The key principles with respect to the budget are that:

1. The total budget for the entire duration of the project should in no case be exceeded;
2. All project expenditures should be charged to the correct budget line and certified by supporting documents, which should be recorded, filed and kept available for verification;
3. Any change to the approved budget shall be authorized by the NMC.