Examination of Witnesses (Questions 474
- 479)
WEDNESDAY 1 MARCH 2000
RT HON
HILARY ARMSTRONG
MP, MR ANDREW
WHETNALL AND
MR PAUL
ROWSELL
Chairman
474. May I welcome you to our final session
on the Audit Commission. I am not quite sure whether you are as
tired as most of the Members of the Committee.
(Hilary Armstrong) Fairly.
475. Could you introduce your team.
(Hilary Armstrong) Good morning, Andrew. I have here
Andrew Whetnall who is Director of Local Government in the Department
and Paul Rowsell who is Divisional Manager of Local Government
Sponsorship.
476. Do you want to say a few words to us to
start with or are you happy to go straight into questions?
(Hilary Armstrong) I am more than happy just to go
straight into questions.
Mrs Ellman
477. What is the aim of the external audit regime?
(Hilary Armstrong) External audit is now well established
in the public sector. What it really is there to do is to provide
that essential link in the accountability chain from those responsible
for spending decisions to those relying on the services being
funded from public funds, very importantly, therefore, to the
general public who are the ultimate providers of these funds.
Auditors in the public sector are independent of an authority
and they have a duty to check that the financial systems that
an authority is using are accurate and that the authority has
set in place adequate arrangements to ensure that its financial
standing is soundly based. It is also their responsibility to
check that the body has an effective system of internal financial
control so that we know what is going on internally but also to
check that the authority has set in place adequate arrangements
to maintain proper standards of financial conduct to prevent and
to detect fraud but also to report on the scope, nature and extent
of work carried out in relation to financial aspects of the corporate
governance of a council. There are clearly stated principles which
the Public Audit Forum, of which the Audit Commission is a member,
have agreed and have published and they form the real core of
the objectives of public audit.
478. You have not mentioned an aim of improving
public services, is that part of their remit?
(Hilary Armstrong) Clearly with Best Value coming
in that is part of how the new legislation is moving in order
to encourage and enable auditors to be part of the regime to enable
councils to both have examined what they are saying they want
to do through the Best Value performance plan but also for the
public then is the Best Value performance plan up to scratch,
is that dealing with the issues the public think are important
and doing that in a way that can be delivered and then have they
delivered what they have said to the public they will do? That
is going to be part of public audit in the future.
479. Do you see value for money as important,
as probity?
(Hilary Armstrong) We certainly do. When I have been
to the Committee before I have talked to the Committee about how
value for money is a part of the whole regime that we are ensuring
is put in place but it has been an aspect of the Audit Commission
since its inception. That is why the Audit Commission have had
national value for money studies and then external auditors have
looked to see how individual local authorities have implemented
those value for money studies in their normal day to day business.
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