Professional Expenditures Verification

Professional Expenditure Verification reduces the risk of cutting the reimbursement of your awarded grants from the Contracting Authority.  The financial and administrative controls exercised by the European Commission are becoming increasingly more frequent and demanding.This is why a professional and robust expenditure verification exercise will help reduce the risk of the subsequent need to refund any element of the grant previously received to the Contracting Authority.

An independent auditor,member of a recognised supervisory body for statutory auditing, must prepare the expenditure verification report. This is a contractual requirement that must accompany payment requests.

For FP7,Horizon 2020 and other EU programs, the expenditure verification is not only an audit and does not provide any formal confirmation or direct assurance that the costs as claimed for reimbursable are all contractually eligible.  It is a report of factual findings based on a series of pre-determined and described tests and procedures set by the Commission  which the auditor must follow and report on.  Based on this report, the Contracting Authority itself  determines the total amount of eligible expenditure.

Some programmes even require expenditure verification before submitting the proposal. 

EuropaBook is able to offer this service through its exclusive alliance and collaboration with a group of specially selected firms led by gda Revisori Indipendenti spa.

gda Revisori Indipendenti spa is a highly reputed Milan-based audit company.  Its fellow group firms are also equally highly regarded in their own countries, with  long-standing experience in EC grant auditing and other assurance services since 1999.

Operational arrangements

The submission of quotes certificates of financial statements  - or other related services - will be coordinated by gda.

Services in Italy will be provided directly by gda. In other EU Member States and selected third countries, services will be delivered by selected audit companies either belonging to the IGAF Polaris International Association (www.igafpolaris.org) or trusted contact firms with whom gdaRevisori Indipendenti has successfully collaborated on EC work and have shown themselves previously to be considered professional, experienced and reliable. For the record, IGAF Polaris International currently comprises of 384 independent accounting and auditing firms in 89 countries.

The value added by gda and its associates for this service lies in their individual and collective experience:

  • Proven experience in audit and expenditure verification services for EU grant contracts, especially related to research programmes all over Europe.
  • Extensive past experience in working with or for many different types of grant beneficiaries including private limited companies, research centres, universities, municipalities and other public bodies. Since 1999, the group has successfully completed over 3,600 discreet contract financial audit assignments directly for commission services covering research, humanitarian and development aid, as well as, education and training programmes.
  • gda has directly audited 680 different grant contracts for audited eligible costs amounting to 700 million euros.  This has encompassed more than 1,700 cost statements and over 300 various beneficiaries in Italy.
  • Full technical understanding not only of the relevant International Standards on Auditing and related professional guidance, but also their interaction with the underlying fundamental grant agreement terms.
  • Our collective many years of experience working for and with the Commission services gives us a good understanding of how they will respond in specific circumstances and thus how to approach particular issues to ensure the maximum opportunity for obtaining Commission concurrence in the shortest and least stressful time period.
  • Through all of the above, EuropaBook provides its clients with tools and aids in the effective preparation of cost statements.

Service quality

Audit services – from signing the engagement letter to issuing the auditor report – are performed in accordance with national legislation and International Standards on Auditing (ISA), defined by the International Federation of Accountants (www.IFAC.org).

The preparation of Expenditure Verification Reports is specifically governed by International Standard of Related Services (ISRS) 4400 – Engagements to perform agreed-upon procedures regarding financial information.

In addition, ISA 210 – Agreeing the terms of audit engagement is relevant in that it stipulates that the auditor must perform preliminary procedures to gain adequate knowledge regarding the client, the service required and the associated risk in order to sign a binding engagement letter.

As required by the International Standard on Auditing concerning “Management Representations” (ISA 580), the beneficiary must sign a “Representation Letter” at the end of the assignment before the Certificate of Financial Statement is issued. The “Representation Letter” acknowledges the beneficiary’s responsibility for the accurate and complete presentation of Financial Statements in accordance with EU contract rules and confirms any important verbal communication held with the auditor during the audit. 

Terms of provision

  • For services within the 28 Member States and within five working days of receiving the form, EuropaBook will send you a preliminary financial offer in Euros. gda Revisori Indipendenti and its fellow group members reserve the right to amend or withdraw this offer at any point in time if the facts and / or other detailed information (as supplied by the beneficiary) upon which the offer was made prove to be materially inaccurate in any form.
  • The offer will be made through gda Revisori Indipendenti, though details of the proposed responsible firm will be disclosed.  Any questions or further clarifications should be submitted, to gda Revisori Indipendenti.  A response will aim to be provided within 24 hours.
  • Where a more detailed proposal including, for example, technical details or expertise, is requested, will be prepared without undue delay and subject to direct discussion between the beneficiary and the firm selected to offer the service.
  • Any offer is prepared on the basis of the information provided in the Service Form. This offer is a non-binding quotation valid for ten working days. The fee will be established on the basis of the cost statements submitted to the audit and other details requested, as summarised in the service form. This will give you a reasonable indication of the estimated cost.
  • For services outside the 28 Member States, tailored solutions will be provided based on the specific circumstances and requirements as advised by the beneficiary.
  • As soon as you confirm your acceptance of an offer, gda will advise the relevant audit firm and contact you directly to collect any additional material You will receive an engagement letter in accordance with the prescribed contractual terms of the grant agreement.
  • The gda offer is valid for 10 working days and you have the right to accept or decline the aforementioned letter.
  • Any specific requirements related to your organisation’s tendering procedures such as the period of validity, standard proposal, etc., will be discussed on a case-by-case basis.
  • As soon as you accept the engagement letter and all other formalities, including satisfying prevailing national and international client acceptance procedures are met, the service will be set in motion. The responsible audit firm will then contact you in order to plan the engagement cycle.

The engagement letter signed by the auditor will be prepared in compliance with the International Standard on Auditing “Terms of Audit Engagement” (ISA 210). In addition, you will  be required to provide the auditor with all the necessary information to comply with the applicable anti-money-laundering legislation.