How to run a CFS audit in Horizon 2020?

How to run a CFS audit in Horizon 2020?

In Horizon 2020, if your entity received more than 325.000€ of grant, you will have to submit a certificate on the financial statements (CFS) to the European Commission (EC) during the final reporting. To obtain such certificate, you need to go through a CFS audit for Horizon 2020 performed by and external independent auditor.

You can download from the EC website the Model for the Certificate on the Financial Statements, which will be used by the auditor. The CFS is then submitted jointly with the final financial report that is automatically generated by the IT system within the Funding & Tenders Portal.

The CFS is composed of two separate documents:

  • The Terms of Reference to be signed by the beneficiary and the Auditor
  • The Auditor’s Independent Report of Factual Findings to be issued on the Auditor’s letterhead, dated, stamped and signed by the Auditor which includes the agreed-upon procedures to be performed by the Auditor, and the standard factual findings to be confirmed by the Auditor

During a CFS audit in Horizon 2020 and to make sure you get as little as possible costs rejected, you should prepare yourself well by studying the eligibility rules of the Annotated Model Grant Agreement (Art. 6 on eligible and ineligible costs) as early as possible. This implies a perfect bookkeeping with all necessary supporting documents at hand. Ask also for support to the coordinator of the project.

The Example of Letter of Representation related to the Certificate on the Financial Statements CFS provided by the EC is also useful as it has to be submitted with the CFS.