APPENDIX 2
INTERVENTION BOARD EXECUTIVE AGENCY: APPROPRIATION
ACCOUNTS (PAC 97-98/289)
LETTER OF
REPRESENTATION PROVIDED
TO THE
C&AG ON THE
BOARDS' 1996-97 AGENCY
ACCOUNTS
AGENCY ACCOUNTS
1996-97
I am writing to confirm, to the best of my knowledge
and belief, the following information in respect of the above
accounts.
Accounting Policies
1. The major accounting policies adopted are
set out in Note 1 to the accounts.
Fixed Assets
2. All fixed assets, including acquisitions
and disposals, have been disclosed in the accounts and have been
valued and depreciated in accordance with stated accounting policies.
All assets were in existence at the balance sheet date. All software
included as an asset is currently used within, or is being developed
for, live systems. All relevant software has been included and
is fairly valued (and where appropriate, revalued) based on the
staff and any resources devoted to it, and in line with stated
accounting policies. All fixed assets have been included in the
Agency submission for the National Asset Register.
Stocks
3. The stocks appearing on the balance sheet
comprise the whole of the Agency's intervention stock and reflect
the book value only. Full reconciliation with the EAGGF annual
accounts is carried out at 30 September 1996.
In our opinion, such stock remains of intervention
quality and is saleable under EC Regulations. Valuation is in
accordance with EC Regulation and all stocks are held free from
any charge. Stocks held on behalf of other parties have been excluded.
4. Provision has been made for all losses sustained
up to the balance sheet date.
Bovine Spongiform Encephalopathy (BSE)
5. The possible link between BSE and Creutzfeldt-Jakob
Disease (CJD) triggered a number of measures aimed at ensuring
public health and at giving aid to the beef industry.
The Over Thirty Months Scheme (OTMS) was introduced
to remove animals over 30 months old from the food chain. The
slaughter premium is partially funded by the EU, whilst the costs
of operation remain with the Agency. The EU funding is in two
elements, 80 per cent on the rendering of the carcasses and 20
per cent on the final destruction. Pending destruction of the
rendered product the Agency is unable to claim the 20 per cent.
The Agency has therefore included the value of this 20 per cent,
£51,682,000, as work in progress.
At the balance sheet date there was also a number
of animals slaughtered under the OTM scheme for which the claim
for Community funding remained outstanding. Finalisation details
to support a claim were not available in all cases. These have
been included as a note to the account.
Debtors
6. The debtors figure includes all debts owing
to the Agency and has been properly produced and valued in accordance
with stated accounting policies.
7. Provision has been made for bad debts and
takes account of all known expected losses.
EC Reimbursements
8. The amounts recoverable from EAGGF are valid
but are subject from 1993 onwards to clearance by the Commission
Auditors.
Creditors
9. The creditors figures include all liabilities
owed by the Agency and has been properly produced and valued in
accordance with stated accounting policies. All creditors fall
due within one year.
Liabilities
10. Other than those liabilities appearing in
the accounts and the provision made for losses, no material or
contingent liabilities exist. There are no known material commitments
in respect of capital expenditure.
General
12. The accounting records provided for the
purpose of your audit, record all the transactions undertaken
by the Agency and are complete except for the following reconciliations:
Between the General Ledger Orders Receivable
Account and Paymaster. Although a complete reconciliation
has not been finalised (by £503k), the reconciliations of
the Daily Cash Sheets to Paymaster, subsequent entries into the
General Ledger, and Direct Paymaster receipts to General Ledger
provide reassurance that all cash received has been recorded within
the system.
Cash Securities Suspense Account (difference
between cash and accrual sets of books £6,872k) and Unapplied
Receipts Suspense Account (differences between cash and accrual
set of books £136k).
13. In addition, a small number of administrative
suspense accounts which are minor in value remain to be validated.
14. These outstanding issues will not materially
affect the account and work is in hand for the early resolution
of these outstanding matters.
15. The accounts include all of the activities
of the Intervention Board that relate to the operation of the
Common Agricultural Policy (CAP).
16. All matters relating to Paying Agency's
schemes have been taken into account in the accounts including
those which require notification under Treasury rules, Companies
Acts requirements or accounting standards.
Events subsequent to the date of the Balance Sheet
17. There are no post balance sheet events.
Intervention Board
27 November 1997
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