skip to primary navigationskip to content

Arts Humanities and Social Sciences Research

The School of Arts and Humanities and the School of the Humanities and Social Sciences

Studying at Cambridge

 

Audits

Audits- purpose and preparation

Verification of costs incurred on an EC project is a key process in ensuring compliance with funder terms and conditions.

Audits for EC projects are conducted by an external accountancy firm, and are arranged by the Research Operations Office. Where an audit is required for an EC project, it will fall in the second month following the close of the reporting period i.e. if the reporting period ends on 31st March, the audit will be in early May. This allows time for documentation to be prepared, and any queries or amendments arising from the audit to be resolved within the 60 day EC reporting window.

The requirement for an audit on an EC project is dependent on the expenditure incurred by the University, and both the threshold and audit process are different for FP7 and H2020 projects as follows:

FP7

  • An audit is required where project expenditure exceeds €375,000, including Overheads.

  • Audits are conducted after the close of each reporting period where expenditure has exceeded €375,000 since the last point of audit e.g. large projects may be audited on multiple occasions.

H2020

  • An audit is required where project expenditure on Direct Costs (excluding Overheads) exceeds €325,000.

  • A single audit is required by the EC after the end date of the project.

  • An interim audit will be organised following the first reporting period, unless a Department opts out with the ROO. This is intended to pick up any errors and resolve them, minimising impact and potential losses to the project. The interim audit policy is available here.

Auditors will review the following documents, and guidance is provided below on key information to be aware of:

Employment contracts, HR information and timesheets for all Personnel

All employment contracts, or equivalent documentation for students on EC projects, will be reviewed by auditors. Dates of employment, salary costs and time commitment to the EC project will be checked in these contracts and via CHRIS.

In addition, auditors will check all project timesheets, ensuring each member of Personnel has submitted and signed timesheets for every month they’ve been working on the project. The time individuals allocate to the project as reported on their timesheets should match the agreed allocation of time outlined in the EC Grant Agreement.

Missing or unsigned timesheets are not uncommon on large EC projects with several members of Personnel, so it is prudent to have systems in place within the Department for collating timesheets and employment contracts, to save time when preparing for an audit.

For further guidance on effective timesheet completion, please see here for details.

Sample of project invoices

Prior to the audit, the Department will be notified of a sample of expenditure transactions selected by the auditors for review.  A range of invoices and expense claims will be checked, and some of the most frequently chosen transactions include:

  • Equipment purchases

  • Subcontracting

  • High value transactions

  • Expenditure without a clear description on CUFS

  • Transactions where VAT appears to be included (relevant to FP7 only, where VAT is ineligible to claim)

Transactions are reviewed to ensure costs are correct and eligible, that the activity took place within the project duration, and to ensure both funder and University policies are being followed e.g. travel and subsistence charges.

Following the audit feedback, any adjustments are made before the expenditure for the period is confirmed and reported to the EC.

The HSS SRT provide comprehensive support to Departments preparing for EC audits – please contact the team for more information. The ROO also provide advice via their website here.