In his annual report for 2001/2002, he says: ‘I look forward to the further implementation of the recommendations set out in Lord Sharman’s report into audit and accountability in central government to widen my responsibilities, particularly in terms of facilitating my appointment as the external auditor of all non-governmental public bodies and formalising in statute my rights of access to private sector organisations in receipt of public funds.
‘The National Audit Office will continue its active participation in the development of new guidance, through taking an active role in bodies such as the Public Audit Forum and the Auditing Practices Board.
‘We will also continue to work with those bodies tasked with strengthening oversight within the profession.
‘The input of the National Audit Office into the work of such bodies is another way in which the assurance provided to Parliament from the Office’s financial audit can be enhanced, through the development of appropriate auditing and accounting guidance for the central government sector and by ensuring that the accounting and auditing regime within the UK is robust.’
Sir John said that over government the quality of accounting and financial management was improving but added: ‘I remain concerned at the time taken by many bodies to prepare and render accounts for audit, particularly at departmental level.
‘Accounts that are not rendered until some months after the year end date are of reduced usefulness and will in the longer temr impact on the timeliness of whole government accounts.’
He welcomed Treasury moves to tackle the problem but said there had been a ‘significant and welcome improvement’ in producing the new resource accounts.
However he said there was in some departments ‘an over-reliance on too few key personnel and a lack of technically competent support staff’ adding that some departments had still to develop the ‘accruals-based management information systems required to embed both resource budgeting and resource accounting into routing financial management.’
Sir John said the new resource accounting system had led to qualifying more accounts in 2001/2002 than 2000/2001 (16 compared to nine) but this was not on the basis of truth and fairness but because the new system meant any excess spending result in qualification which was not the case with the old government appopriation accounts system.
He welcomed new moves to improve coprorate governance and risk management in government departments.
As a member of the Department of Trade and Industry’s Co-Ordinating Group on Audit and Accountancy Issuesÿ which issues its final report in January, Sir Johnÿ said: ‘I welcome the recommendations made by the Co-ordinating Group and by accompanying reports whichÿ aimÿ to esnure a robust regulatory framework for the audit and accountancy professions. I and the National Audit Office are committed to playing an active role in the development of the new arrangements.’
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