PracticePeople In PracticePublic sector accounts watchdog slates Bank of England accounting

Public sector accounts watchdog slates Bank of England accounting

The Bank of England's financial management has received stinging criticism in the first published inspection of the country's official gold and currency reserves, which it manages.

A report from Sir John Bourn, head of the National Audit office, gave the Exchange Equalisation Account an unqualified opinion on its accounts, but highlighted problems with the way the accounts are prepared and difficulties with tracing transactions.

‘In order to reconcile underlying cash movements some transactions, such as profits and losses on sales and interest receipts, were initially included in the accounts more than once,’ said an NAO statement.

The report notes EEA accounts were drawn using both accruals and cash accounting methods.

A lack of a ready trail from individual transactions to accounting records was also underlined by the report.

The Bank is now embarked on changing the way it does the accounts and a retaining records of transactions on a daily basis.

The EEA holds the UK’s official reserves of gold, foreign currencies and is managed by the Bank on behalf of the Treasury.

The NAO report covers the accounts for 1997/98 and is the first to be made public. Previously the NAO was only required to confirm the regularity of transactions under the account.

Business backlash over plans to give NAO powers of access over working families tax credit

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