The Certificate on the Financial Statements (CFS) is one of the most important compliance requirements in Horizon Europe and the former Horizon 2020 (H2020) framework. For many beneficiaries, it can feel like a complex administrative step, but in reality, the CFS audit is a safeguard. It protects both the European Commission (EC) and project participants by verifying that reported costs are accurate, eligible, and compliant with EU grant rules.
If your project requests more than €430,000 in EC contribution for Horizon Europe, you will need a CFS audit as part of your EU project reporting requirements. In this guide, you’ll learn:
- What a CFS audit is and when it becomes mandatory;
- The CFS threshold in Horizon Europe;
- Who can issue a CFS audit and what the process looks like;
- Which costs are eligible and reimbursable;
- Why the CFS benefits beneficiaries;
- How Vistiveri Consulting supports compliance and project management.
What is a CFS in Horizon Europe?
A Certificate on the Financial Statements (CFS) is an external audit that confirms the accuracy of your project’s declared costs. It is an official audit certificate issued by an independent statutory auditor.
The CFS is part of Horizon Europe financial reporting obligations. It ensures your project’s financial position, performance, and use of funds are consistent with the EU grant compliance rules.
The CFS is submitted within 60 days of the last reporting period as part of the Final Report, which includes:
- A Final Technical Report: summarizing project results.
- A Final Financial Report: including the summary financial statement and the CFS audit.
Think of the CFS as your project’s financial passport, essential for demonstrating compliance with EU funding requirements.
When is a CFS required?
The CFS threshold in Horizon Europe is €430,000.
- If the total EU contribution claimed by a beneficiary exceeds this amount, a CFS is mandatory (Grant Agreement Article 24.2, Annex 5);
- The rule applies to each beneficiary and to any linked third parties claiming above the threshold.
Failing to provide a CFS when required can lead to rejected costs, delayed reimbursements, or even additional Horizon Europe audit preparation requests.
Are CFS audit costs eligible?
Yes. The cost of a CFS audit is eligible under EU funding rules.
It falls under cost category C.3 Other goods, works and services. This means the auditor’s fee can be included in your project’s financial reporting and reimbursed, provided it directly relates to the grant.
Understanding the difference between eligible vs ineligible costs in EU projects is critical here — and a consultant can help ensure your reporting stays compliant.
Who can issue a CFS?
A CFS audit can only be performed by a qualified statutory auditor in the EU, in line with Directive 2006/43/EC.
- In Romania, this can be verified via the ASPAAS official register;
- At Vistiveri Consulting, we partner with licensed auditors (AF4881 and FA238/338/22) experienced in Horizon Europe, H2020 audits and all 2021-2027 EU programmes.
To remain compliant, ensure your chosen auditor is properly certified.
Horizon Europe CFS audit process: step by step
The process follows Annex 5 of the Grant Agreement and includes:
- Terms of Reference: signed between auditor and beneficiary;
- Certificate template: the EC’s official model;
- Audit procedures: detailed review of personnel costs, subcontracting, travel, and other expenses;
- Error identification: irregularities are flagged;
- EC review: the auditor reports, but the Commission decides how errors affect reimbursement.
For beneficiaries, this process doubles as Horizon Europe audit preparation. It ensures you are ready not only for the final report but also for potential second-level audits by the Commission.
Why the CFS audit benefits beneficiaries;
Many beneficiaries worry about audits, but the CFS audit is also an opportunity. It highlights weaknesses and prevents future problems.
Common EU grant financial errors to avoid include:
- Miscalculating personnel costs or timesheets;
- Reporting subcontracting incorrectly;
- Overlooking travel documentation.
By addressing these early, you strengthen compliance and improve financial management. A CFS audit helps you:
- Prepares you for a possible incoming audit from the EC;
- Avoid clawbacks for ineligible costs;
- Improve systems for EU project management support;
- Build credibility with project partners and the EC.
FAQs – Horizon Europe CFS
- What is the Horizon Europe CFS threshold?
The threshold is €430,000 in EU contribution claimed. - Are CFS audit costs reimbursable?
Yes, they are considered eligible under “other goods and services.” - Who can perform a CFS audit?
Only a qualified statutory auditor in the EU. - What happens if I don’t submit a CFS when required?
The EC may reject costs, request corrections, or delay payments.
Why work with Vistiveri Consulting?
At Vistiveri Consulting, we don’t just issue CFS audits. We provide consultancy for EU project reporting and complete EU project management support. Our services include:
- Full preparation and issuance of CFS audits;
- Guidance on financial reporting for EU grants;
- Identifying weaknesses in internal processes;
- Support in Horizon Europe audit preparation and EC second-level audits.
If you’re looking for a consulting firm for EU grants or want to hire EU funding consultants with experience in Horizon Europe, we’re here to help.
Our work is driven by purpose, and our clients’ success is at the heart of everything we do.
If you need guidance or support in your EU projects, feel free to reach out to us.
Image Source: Andy Goodman
Note: This article is based on official information from the European Commission Funding & Tenders Portal and related EU programme websites.
Go further with Vistiveri.
1. Learn — Academy by Vistiveri
Our learning platform for everyone working with EU grants: expert-led courses on EU funding fundamentals, cost eligibility, personnel costs, funding, reporting, and audit preparation: built by experts or auditors in EU grants.2. Start here — EU Funding Basics course
New to EU funding? This is the structured entry point — programmes, eligibility, the application process, and the rules your project will be measured against at audit.3. Get audited — CFS-Audit by Vistiveri
Already running a project? We deliver independent ISRS 4400 Certificates on Financial Statements for Horizon Europe, LIFE, H2020 etc. beneficiaries across Europe.
This article is for information purposes only and does not constitute personalised legal, tax, or audit advice. For specific situations, contact the Vistiveri team.
