By Julien Sudre, grant writer and Horizon Europe project manager, founder of Grant360 and Innotrope. Originally published 11 November 2025. Updated: 23 September 2026.
Horizon Europe beneficiaries should prepare for checks and audits by keeping records that demonstrate the work performed and, for actual-cost grants, the eligibility of costs claimed. An audit may examine financial statements and supporting systems; a project review examines implementation and other grant obligations. Beneficiaries can comment on a draft audit report before findings are finalised. The rules in the signed Grant Agreement govern the specific project, while the Commission's Annotated Grant Agreement (AGA) and Online Manual on checks, audits and reviews explain the general framework.
This guide draws on the author's experience writing more than a hundred grant applications and managing European projects. It is a practical overview for coordinators and beneficiaries, not a substitute for the signed agreement or the formal audit notice. In particular, lump-sum grants are different: the Commission says they are not subject to financial audits of actual costs, although implementation and other obligations may still be checked or reviewed. Online Manual: checks and audits.
What is the difference between a check, a project review and a financial audit?
A project review assesses whether the action is being implemented properly and whether the consortium is meeting its Grant Agreement obligations. It may examine deliverables, reports and other aspects of the work. A financial audit examines the reliability of financial statements and compliance with the applicable cost rules. Checks and investigations are other forms of scrutiny with different purposes and powers. The Commission's Online Manual distinguishes reviews, audits and investigations under the grant framework.
For example, a review might ask whether a promised clinical pilot actually took place and produced the agreed deliverable. In an actual-cost grant, a financial audit might examine the personnel and purchase costs claimed for that work. Under a lump-sum grant, the granting authority can review proper implementation without auditing the beneficiary's actual costs for payment purposes. Do not call every contact from the project officer an audit; read the notice to understand its scope.
Which documents should beneficiaries keep from the start?
Keep records that prove proper implementation and, where actual costs are claimed, support the amounts declared. The Online Manual on keeping records states that all participants must retain supporting documentation and explicitly distinguishes lump-sum grants: they need evidence of implementation, but not records of actual costs incurred for grant cost verification. Article 20 of the AGA explains the detailed rules and retention period applicable to the agreement.
For an actual-cost purchase, retain the records required to show the cost, its link to the action and compliance with the applicable purchasing rules. For personnel, use the cost calculation and evidence method permitted by the agreement; do not assume the same timesheet or salary formula applies to every grant and beneficiary. For any funding model, keep relevant deliverables, activity evidence, approvals and decisions that establish the work was carried out as promised.
Set clear file ownership, access permissions and handover arrangements. If the staff member who managed a pilot leaves, another person should still be able to locate its protocol, approvals, results and submitted deliverable. Check the agreement's record-retention clause before setting a deletion date; a universal "two years after project end" rule would be unsafe.
How can a coordinator and beneficiaries prepare before an audit notice?
Build the evidence trail during the project. Each beneficiary should know who holds finance, human resources, procurement and technical records; the coordinator should maintain the consortium-level account of activities, submitted deliverables, changes and reporting. An internal review can sample a few declarations and ask whether the supporting evidence can be retrieved and explained. This is a management practice, not a Commission requirement to conduct a formal "mock audit."
For example, select one personnel declaration, one purchase and one travel claim from an actual-cost grant. Compare each with the relevant rules, underlying records and described project activity. If a document is missing, investigate while colleagues and systems are still available. Do not create backdated records to make a file appear complete; document a genuine clarification and its provenance instead.
Include scientific and administrative teams in the review. A finance team may understand the amount claimed while a work package leader can explain the task and output it supported. For the wider project routines that keep these accounts aligned, see How do you manage a Horizon Europe project effectively?.
What happens when a financial audit is announced?
Read the formal notice to identify the beneficiary, grant agreements or periods covered, timetable, auditors and requested documents. Assign a contact person, alert the affected internal teams and agree how records and explanations will be supplied. The precise procedure follows the notice and the applicable agreement; the AGA's provisions on checks, reviews and audits are the starting point.
An auditor may examine selected transactions, cost calculations, supporting documents and relevant internal practices. Answer requests with the original or reliably retrievable records and a concise explanation of how they relate to the declared amount. If a request is unclear or a deadline cannot reasonably be met, raise that promptly through the indicated channel rather than guessing what is wanted.
A financial audit is not necessarily on-site, nor does every audit examine the same cost categories or every project in a beneficiary's portfolio. Avoid relying on a generic checklist as a prediction of its exact scope. Keep a request log with the document supplied, version, date and person responsible so the team can respond consistently.
How should you respond to draft findings?
Review each proposed finding against the applicable grant rule, the claimed transaction and the evidence. The Commission's Online Manual confirms that beneficiaries receive a draft audit report and can submit observations. Check the response deadline in the formal communication.
Prepare a response table with the finding, factual point disputed or accepted, applicable provision, supporting documents and requested correction. For instance, if an auditor questions a purchase's link to the action, point to the relevant task and the contemporaneous procurement and use records. Where a calculation is genuinely wrong, state the corrected amount and assess whether the same method affected other declarations.
The opportunity to comment is meaningful, but no evidence supports a general claim that "most findings" are overturned. A clear response may correct a misunderstanding or reveal a real error. The final outcome depends on the facts and the granting authority's procedures. Seek specialist financial or legal advice when a significant finding or interpretation warrants it.
Can an audit finding affect other projects?
Yes, a systemic error can have implications beyond the sampled transaction or audited period. The Commission's Online Manual says the granting authority may extend audit findings to non-audited grant agreements or periods when systemic errors are found. Whether this happens and how it is calculated depend on the findings and the applicable rules in the AGA.
For example, an isolated missing invoice is a different issue from a personnel cost method used incorrectly across several grants. When a draft finding concerns a method or internal policy, identify every declaration that may have used it, check the underlying rule and preserve the analysis. Correct the process for future claims while the formal finding is resolved.
Is a Certificate on the Financial Statements the same as an EU audit?
No. A Certificate on the Financial Statements (CFS) is produced by an independent auditor or eligible public officer under a prescribed template when the grant and claimed contribution meet the applicable conditions. It accompanies financial reporting; it does not remove the granting authority's right to perform later checks or audits. The Online Manual on reports and payment requests explains the CFS and notes that thresholds depend on the programme and action.
Check your topic and signed agreement before assuming a certificate is required. Plan for the necessary review well before final reporting if it applies, and provide the practitioner with the underlying records. A certificate can help identify issues, but it is not an advance approval of every cost item.
How long can checks or audits occur after a project ends?
Use the time limits and record-retention periods in your signed Grant Agreement, measured from the contractual event specified there, rather than from an informal "end of project" date. Different powers can have different limits, and an initiated procedure or other circumstances may affect the period. The AGA's explanations of Articles 20 and 25 set out the general record-keeping and control framework.
The original article stated that ex-post audits can be initiated up to two years after payment of the balance. That may describe a particular contractual audit power, but it does not mean all records can be deleted then or that every type of check and investigation ends at that point. Ask the grants and legal teams to record the applicable retention date for the project and any reason to extend it.
What is the most useful audit-readiness routine?
Assign an owner to each evidence category, keep records as work and costs occur, reconcile the technical and financial accounts at each reporting period, and test a small sample before files become difficult to retrieve. When a notice arrives, respond to its actual scope and timetable. When draft findings arrive, answer each one with the relevant rule and evidence. This routine improves traceability whether or not a financial audit takes place.
For a broader view of grant governance and reporting, read How do you manage a Horizon Europe project effectively?. If you organise project records in a shared tool, Grant Hub describes Grant360's current product capabilities; the signed agreement and Portal remain the authoritative sources for obligations and official submissions.