Is your Horizon Europe grant higher than €430,000? If so, this is an important threshold, as it comes with additional formal obligations that should not be overlooked.

In particular, you will be required to submit the Certificate on Financial Statements (CFS) as part of the final project report. This certificate is a mandatory document issued by an independent auditor that confirms the direct costs of your project are eligible.

This means that financial management, documentation, and reporting processes must be approached with greater precision, as additional verification measures apply.

There is no need to panic, however. Being aware of the relevant requirements will help ensure compliance and avoid any issues later in the reporting process.

What is a CFS?

First, it is important to understand that the CFS is a highly detailed financial audit carried out by an independent auditor in line with EU-defined procedures. It is based on a sample of financial documents and follows the Horizon Europe rules on cost eligibility.

If auditors determine that certain costs do not meet eligibility criteria, they may:

• Exclude them from the certified amount

• Reclassify them under different categories

• Request corrections to the financial statement

These adjustments can have tangible consequences, including a reduction in the final grant amount.

Documentation: from archive to backbone

At the moment of audit, the auditors will request supporting documents for sampled transactions, and sometimes for entire categories of expenditure. They will expect consistency, completeness, and accessibility.

This changes how organizations must approach document management. It is no longer enough to simply “have” documents. They need to be:

• Well-organized and logically structured

• Complete with all relevant elements

• Easily retrievable within short timeframes

• Clearly linked to reported figures

Even small gaps can create problems. A missing invoice, an unsigned contract, or an unclear payment trail can lead to a cost being considered ineligible, even if the expense itself was fully legitimate.

That’s why good document management is not just an administrative task but a key part of project management, ensuring compliance and avoiding issues during the audit.

Operational impact: time, pressure, and coordination

Crossing the CFS threshold doesn’t just introduce an audit requirement, it changes how the project operates on a day-to-day basis.

First, timing becomes tighter and less flexible. Preparing for the final report requires additional steps, including internal checks, document reconciliation, and coordination with the external auditor. What used to be a relatively straightforward reporting exercise becomes a more structured and time-consuming process, often requiring preparation well in advance of submission deadlines.

Second, there is an increase in operational pressure. The project team must ensure that every cost can be recognised, supported, and justified. Small inconsistencies that might have gone unnoticed can now lead to significant issues during the audit.

Finally, the shift introduces a stronger need for coordination across teams. Financial, administrative, and technical staff must work closely together to ensure that reported activities, costs, and documentation are fully aligned.

In practice, the CFS requirement transforms the project from a reporting-driven exercise into a continuously monitored, audit-ready operation. Preparing early makes it much easier to handle the additional workload and avoid last-minute issues.

How to prepare for a CFS

To navigate the transition successfully:

• Start early: Don’t wait until the audit begins to organize documents

• Maintain audit-ready records: Keep files complete, consistent, and accessible

• Align with guidelines: Carefully review EIC funding rules (e.g. included in Annotated Grant Agreement) and ensure compliance

• Communicate internally: Ensure finance and project teams are aligned

• Conduct a pre-audit: A great way to reduce stress and ensure you are well prepared for the official audit

Yes, a larger grant brings additional responsibilities—but with good preparation, clear processes, and consistent record-keeping, the final audit becomes a manageable step rather than a hurdle race.

If you need support with verifying cost eligibility, have questions about the rules, or would like to conduct a pre-audit, we will be happy to help you, just get in touch: [email protected]