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Who can issue a Certificate on the Financial Statement (CFS) after an audit?

Certificate on the Financial Statement (CFS) – Horizon Europe

A Certificate on the Financial Statement (CFS) must be issued by a qualified auditor following the completion of an audit. The auditor is required to use the European Commission’s official template, which includes:

  • The Terms of Reference (the model agreement between the beneficiary or affiliated entity and the auditing firm)
  • The CFS model report itself

As a beneficiary, you can consult this template for guidance on what the auditor is expected to check. In their report, the auditor will flag any irregularities or errors identified during the audit. It is the responsibility of the European Commission or the relevant funding agency to determine the consequences of any such findings.

When is a CFS Required?

Under Horizon Europe, a CFS is mandatory when the total EU contribution claimed by a beneficiary exceeds the threshold of €430,000, based on actual costs and/or usual cost accounting practices.

Purpose of the CFS

The primary goal of the CFS is to provide the EU granting authority with clear, audit-based findings to help assess whether:

  • Declared costs (based on actuals or usual accounting practices)
  • And, if applicable, revenues

…comply with the terms of the Grant Agreement.

Cost and Eligibility of CFS Audits

A CFS audit typically costs between €2,500 and €8,000, depending on the size and complexity of the project. These costs are eligible for reimbursement, provided that:

  • The audit is mandatory
  • The costs meet the eligibility criteria set out in Article 6 of the Grant Agreement

These eligible costs can be included in the final financial report.

Audit Requirements and Professional Standards

The auditor must adhere to the highest professional standards. Specifically:

  • The Terms of Reference, checklist, and report template must be followed exactly—no modifications are allowed.
  • The engagement must be properly planned to ensure effective performance.
  • The auditor must base the report on evidence obtained through the agreed-upon procedures.
  • All important findings and supporting evidence must be clearly documented.
  • The report must detail each finding and quantify any affected amounts, allowing both the participant and the granting authority to take appropriate action.