Project reporting under SME Instrument Phase2

Reporting is an essential activity during the lifetime of any Horizon 2020 project, as every project manager needs to not only maintain control and steer project progress but also inform the project sponsor about progression of the work towards its agreed objectives.

Juan Jose Vazquez | May 15. 2020
Juan Jose about Project reporting under SME Instrument Phase 2

With today’s blog article I’d like to give an overview about project reporting in Horizon 2020 (H2020) funded projects, particularly those running under an SME Instrument phase 2.

What is project reporting?

Reporting is an essential activity during the lifetime of Horizon 2020 project, as every project manager needs to not only maintain control and steer project progress but also inform the project sponsor about progression of the work towards its agreed objectives. In the case of SME Instrument, the main project sponsor is the European Commission (EC) through their Executive Agency for Small and Medium-sized Enterprises (EASME).

When reporting in Horizon 2020 on the project status, you will have to cover not only scientific and technical advances but also financial aspects like cost consumption and other activities related to commercialization, communication, and project management.

Why is project reporting important?

Project reporting is an essential part of any company’s project management best practices, as it allows a comparison of how the project is performing against the original planning, schedule, and budget. It assists in early detection of deviations and indicates if resources are being distributed efficiently. In my view, the most important benefit of good project reporting is to improve the decision-making process: an informed decision could potentially lead to a better outcome.

For projects running under SME Instrument Phase 2, accurate and complete project reporting is particularly important since interim payments by the EC are directly associated with the reports’ approvals.

How to report in Horizon 2020?

In the past, there used to be a few ways to provide the EC with a summary progress report but lately the EC asks to upload a set of aggregated project reporting data online via the Funding & Tenders Portal or simply participant portal.

In Horizon 2020 project reporting is divided into three categories or types of report, and each of these is rated slightly differently.

  • Continuous reporting

As implied by its name, this type of project reporting in Horizon 2020 runs in a continuum from the beginning to the end of the project. Partners mainly provide information on the status of deliverables and milestones, but there are many other areas that you could inform the EC about: such as risks affecting the project, scientific papers published, advancement on intellectual property management, or project dissemination initiatives.

Information provided during continuous project reporting is assessed at the time of each periodic report is submitted.

  • Periodic Report

As the name suggests, for the periodic report in Horizon 2020 you have to report on the progression of work done over a certain period of time, also known as the reporting period. The length of such periods can vary from 3 to 18 months and they are defined by the EC in the grant agreement (GA) at the beginning of the project.

The Periodic Report is subdivided into technical and financial reports. While the technical report describes progression of scientific/technical work, the financial report covers project budget allocation and the financial statements.

The Technical report in Horizon 2020 itself consists of two parts, Part A (directly entered into forms onto the Participant Portal) and Part B (uploaded as PDF to the Participant Portal).

Part A covers identical areas to the continuous project reporting, i.e. if you have kept the continuous project reporting up to date and in a timely manner, then it is very likely that most of the job is done by the time of preparing the Periodic Report. There is a particular section in Part A called summary for publication where you are asked to provide an overview summary on progression of work done towards the expected impact of your Horizon 2020 project on the economy, society, and environment. Later, this section of Part A is going to be published on the EC’s Community Research and Development Information Service website (CORDIS) where it will become publicly accessible to anyone. The idea behind CORDIS is to centralize project achievements and outcomes and serve as source of networking and synergies among business and organizations.

Part B is a project status report and completely different from Part A, since it covers an extensive and fully detailed narrative of the progression of the work done, from project objectives, work packages, and tasks’ progress descriptions to the use of resources (human and financial). Most Horizon 2020 project managers request interim reports and continuously gather required information from partners, WP or task leaders during the project reporting period, in order to be on track and have everything ready for the Periodic Report. Also, any deviations from original planning should be explained here.

The Financial Report in Horizon 2020 refers to the consumption of the project costs incurred during the period. If you have implemented a regular interim cost reporting, then you will most likely only have to pull out the financial data covering the period for this report. This financial data is then summarized on a financial statement containing aggregated figures of the different costs categories such as personnel, subcontracting, travels, equipment, and other goods and services, and indirect costs. The financial statements are prepared and submitted online via the Participant Portal. Every interim payment by the EC is subject to approval of the financial report and represents a percentage to be reimbursed on total cost accepted by EC (some costs may be rejected during assessment due to not being eligible), normally 70% reimbursement rate for for-profit entities.

In Horizon 2020 one Periodic Report is prepared and submitted per period.

During periodic reporting no other documents, apart from the ones mentioned above, have to be provided to EC. Meaning that invoices, contracts, time-sheets, and other proof of payments must be kept on file, but are not required to be submitted unless explicitly asked for. The EC may even order an audit up to 2 years after the final payment.

  • Final report

This is similar to periodic reporting, in the sense that it includes both technical and financial aspects, where the tech part is also divided into A and B and a financial statement needs to be submitted. The main difference to a periodic report is that the final statement must be certified. This is also known in Horizon 2020 as certification on financial statements or CFS. An independent auditor certifies that costs of the financial statements are eligible.

In case of financial errors committed in previous periods, the final report would provide an opportunity to correct them.

In summary, project reporting represents a fair amount of administrative work, however it is mandatory under SME Instrument Phase 2, and the more detailed and clear the information is prepared, the fewer clarifications will be asked, which reflect in faster interim payments.

Also, good to know: project reporting documentation is reviewed by EC (project office, financial officer, potentially an ethics committee) and a pool of external independent experts in the project field. From project reporting submission date, EC has up to 90 days to review and pay.

Juan Jose Vazquez,

Project Manager EU programmes Horizon Europe & Horizon 2020 – MBA (candidate)

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