MPs have ordered the Foreign Office to recruit ‘professionally qualified,
experienced people’ at a senior level to take charge of finance ‘without
delay’ following a row over its delayed annual resource accounts and a
£790,000 fraud scandal.
The House of Commons foreign affairs committee demanded a full explanation
for the ‘excessive’ delay delivering the 2004-05 accounts, which should have
signed-off last September, but were delayed to October and further to the end of
November and then not made available until mid-January.
The committee said: ‘This had the unacceptable consequence of depriving
Parliament and the public of an important tool for exercising scrutiny.’
The hold-up was said to have been caused by problems with a computer system.
The report also accused the department of having ‘failed seriously in its
duty’ by not informing MPs of the fraud at its Tel Aviv embassy described
by the National Audit Office as ‘the largest identified loss by fraud in its
The report said this incident raised concerns both about its financial
controls and detection systems and about giving information to the
A subsequent paper from the department detailing the lessons learned from
this and other unidentified frauds ‘sets out a number of sensible
procedures and safeguards which should already have been in place’.
The MPs also protested they had been kept in the dark over a consultants
report by Collinson Grant Limited which identified £66 million in potential
annual savings. Senior managers were accused of having failed to co-operate
including those in charge of the Paris embassy, which the report said
deserved ‘the severest censure’.
The report criticised top management as weak and unwilling to make changes.
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Head of editorial Kevin Reed discusses this week's important accountancy news, including Brexit and audit market evolution