CFS Thresholds and the Systems and Processes Audit (SPA)

  • The ‘standard’ threshold for a CFS will increase from €325 000 in Horizon 2020 to €430 000 in Horizon Europe. Organisations receiving EU contribution from the programme, which is equal to or higher than this amount will need to submit an audit certificate with their final report.
  • Another important change concerns the calculation of the thresholds. In Horizon Europe the CFS threshold will be based on EU contribution calculated on all costs (including flat rates, etc.), which is not the case in Horizon 2020. This means that costs such as overheads will now count towards the higher CFS threshold.
  • There will be a higher CFS threshold (€725 000) for beneficiaries with the best classification after the so-called Systems and Processes Audit (SPA), which will be a new element of the control strategy in Horizon Europe designed to reduce administrative burden for selected beneficiaries by resulting in fewer, more focused audits.
  • The SPA will only be available to the most active beneficiary organisations with a large portfolio of projects (both in terms of numbers and EU contribution received). 
  • The SPA will consist of two main elements aiming to assess the financial risk at the level of the participating organisations: test of the beneficiary’s financial control systems and test of the beneficiary’s financial transactions. The combined review will result in either low-, medium-, or high-risk classification. Organisations with the low-risk assessment will benefit from the higher CFS threshold, thus reducing the need for internal audits. It is yet unclear how the low-risk SPA classification will impact financial audits conducted by the European Commission.