Interim and final payments

After each reporting period the consortium submits its technical report and financial statements, the Commission assesses them, and an interim payment follows for the costs it accepts. Assessment normally runs to around 90 days from receipt, and it stops if the report is incomplete or if questions are asked.

Payments are capped in aggregate before the end. Pre-financing plus all interim payments cannot exceed 90% of the maximum grant amount, so a fixed share of the grant is only ever paid after the project is over and the final report accepted. The consortium finances that last slice itself throughout.

The FINAL payment settles the balance: total accepted costs times the funding rate, minus everything already paid, plus the return of the amount withheld for the Mutual Insurance Mechanism where nothing is owed. It can also be zero, or negative, if earlier payments exceeded what the accepted costs justify, in which case money is recovered.

Rejected costs are the common cause of an unpleasant final settlement. Costs disallowed in an early period are not usually recovered immediately; they reduce the balance at the end, which means a consortium that has been spending against a number it believed was accepted discovers the correction at the point where it has nothing left to adjust.

Cash flow planning for a multi-year EU project therefore assumes: an advance at the start, a long gap, periodic payments that lag the spending by six to nine months, and a final settlement that may arrive a year after the work finished. Organisations that cannot carry that gap should be partners with small budgets rather than coordinators.