Audits & certificates
The European Commission`s audit policy in the area of research and innovation funding is generally based upon three pillars: Certification (“audit certificates”, certificates on the financial statements – CFS), certificates on the methodology, and the so called ex-post audits.
Audit certificates (certificates on the financial statements) serve as proof of correct accounting of all eligible costs. Audit certificates are mandatory starting from a EU- contribution of EUR 325,000 (without lump sums, flat rates and unit costs, with exception of the average personnel costs) per partner at the end of the project and have to be issued by a qualified auditor.
As concerns the choice of an auditor, public institutions, universities and research institutions have two possibilities: They can either appoint an
external auditor (independent and qualified after the directive 2006/43/EG) or an
‘competent public officer’, e.g. an internal auditor, who is not involved in the creation of the financial statements, and who has to be approved by a national, higher-ranked agency.
The costs incurred for an external auditor are eligible if the certificate required for the respective partner. In Horizon 2020, the costs for the audit certificate are no longer considered a subcontract, but a service. Annex 5 of the Model Grant Agreement provides guidelines and a check-list for the examination procedure that has to be followed by the auditor.
Certificates on the methodology
Participants that claim personnel costs on the basis of unit costs in accordance with their organisation’s usual accounting practice, can voluntarily hand in a certificate on the methodology. If the certificate is accepted by the Commission, methodical accounting mistakes are excluded when using the certified method. The certificate on the methodology is valid for all actions in Horizion 2020.
Annex 6 of the Model Grant agreement provides a guidance for preparing the certificate on the methodology.
Ex-post audits are financial audits carried out by the Commission, resp. by specifically appointed auditors. Their goal is to ensure that the accounting of the beneficiaries has been correct. Each project partner can be chosen until up to two years after the end of a project (starting from the moment of final payment) for an ex-post audit. Project documents have to be preserved for five years after the final payment, and for three years in case of smaller contributions up to a value of EUR 60,000.