It must be one of the longest running accounting rows around. The Ordnance
Survey (OS) has for ten years refused to take the advice of the National Audit
Office over the capitalisation of data.The NAO said they should. The mapmaker
has argued that the data is unique and therefore cannot be valued.
The stand-off has lasted for a decade and for all those years the OS has had
its accounts qualified. But no more. Peace has broken out. The OS has changed
its policy due to international accounting standards and the NAO has at last
signed off on the accounts.
Over the ten years the OS position did not change. It believed the data it
collects could not be valued because of its unique status and because there was
no functioning market on which it could be valued.
OS claimed this was what was required under Financial Reporting Standard 10
Goodwill and Intangible Assets.
The head of the NAO said: “My decision to qualify OS’s accounts in 1999-2000
and subsequent years reflected my opinion that under the provisions of Financial
Reporting Standard 15 the data would be more appropriately accounted for as a
tangible fixed asset and should be capitalised.”
But time passes and circumstances change.
The 2008 Budget announced that from 2009-10 the accounts of central
government departments and entities in the wider public sector would have to use
International Financial Reporting Standards and in doing so OS applied
International Accounting Standard 38 Intangible Assets and capilatised all
development expenditure, including data related costs, puting a total net book
value of £16.5m on transition to IFRS as at 1 Apeil 2009.
In a note to the 2009-10 Annual Report and Accounts Morse said the total net
book value of all OS’s intangible assets was £63.3m.
He said that as OS had now implemented the new standards and amended its
accounting policies on asset recognition and capitalising data, “I have removed
the qualification of my audit opinion”.
OS’s finance director Paul Hemslery saw things slightly differently.
He said OS had now capitalised the measurable development costs incurred
since 1999, at 1 April 2008, at £37.3 million.
But he insisted: “The overall value of OS survey data and the brand are not
capable of being valued reliably and are therefore not capitalised.”
One thing is however still not clear: who won?
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