Financial corrections on EU projects: where they come from

A financial correction never comes from an unexpected place. It comes from the same six, year after year, at different beneficiaries. We list them in the order we meet them.

1. The procurement procedure

This is the most frequent and the most expensive source. Procurement carried out without following the procedure the funding body requires attracts a correction even if the price paid was good and the goods were genuinely delivered. Publication, deadlines, award criteria and the reasoning behind the choice are all checked.

Checked before the reimbursement claim is submitted, a weak procedure can sometimes be run again. Checked at inspection, it cannot.

2. Eligibility in time

The expenditure has to fall within the eligibility period. Invoices issued before the financing contract was signed, or after the end date, appear often, particularly for services invoiced in instalments.

3. The audit trail

Every amount claimed has to be traceable from the reimbursement claim through to the supporting document and the actual payment. A chain broken somewhere in the middle is treated as unproven, even where the expenditure is real.

4. Staff costs

The problem here is not the salary, it is the timesheet. Time charged to the project has to be supported by records consistent with the rest of that person’s work. Someone charged full time to the project who signs documents for ordinary business in the same period produces a correction.

5. Double funding

The same cost claimed from two sources. Rarely deliberate, often careless, and most common at beneficiaries running several projects at once.

6. Information and publicity

Visibility obligations look minor until their absence becomes a percentage applied to the whole project value. The sign, the acknowledgement on materials and on the website are contractual requirements, not suggestions.

What can be done in time

All six are visible in a check carried out before the claim is submitted. That is the useful part of a project audit: it does not only confirm that you spent correctly, it shows where you did not, while there is still something to be done about it.