Select Committee on Northern Ireland Affairs Fifth Report


6. The Department's memorandum[5] sets out the history of the implementation by the Northern Ireland Office of RAB. At the same time as this was submitted, the Department sent us the 'dry run' Resource Accounts for 1998- 99 and 'dry run' resource based Estimates for 2000-01, together with an illustrative commentary.[6]

7. We are grateful to the Northern Ireland Office for supplying this material. We were pleased to note that the 1998-99 accounts had enabled the Principal Accounting Officer to offer assurances to the Treasury that the department remained on track to produce resource accounts for 1999-2000 capable of withstanding audit[7] and that the informal audit opinion from the Comptroller and Auditor General on the 1998-99 resource accounts concluded that no substantive issues of concern arose. The Northern Ireland Office commented thus:[8]

    "Any issues which were identified by the NAO during their audit work do not have a significant impact on the department's introduction of RAB in accordance with the planned timetable. The issues identified are being addressed by the department and, where appropriate, changes to procedures and/or systems are being put in place and will ensure further improvements leading to better quality 'dry-run' accounts in 1999-2000 and a clear audit opinion for the 2000-01 accounts."

8. In the oral evidence session, the witnesses helpfully clarified a number of matters relating to the detail of resource based estimates and accounts and the control mechanisms in particular.[9] They also explained that four of the five Requests for Resources in essence reflect the broad functional areas of responsibility of the Northern Ireland Office,[10] with the fifth, which constitutes the bulk of the overall resources, representing the transfer to the Northern Ireland Consolidated Fund. The witnesses told us that the detail lying behind this estimate was a matter for the devolved administration.[11]

9. In the event, progress in preparing the formal resource accounts for 1999-2000 was not as smooth as had been initially anticipated by the Northern Ireland Office. These, like those of other departments, were due to be laid before Parliament by 31 January 2001, to enable departmental committees to scrutinise them, if they so wished, before the Vote on Account for 2001-02 was put to the House.[12] For this reason, special arrangements were made to defer the cut off date for the Vote on Account to be considered.[13]

10. When the accounts did not appear by 31 January 2001, we sought an explanation from the Northern Ireland Office. This revealed that three areas of difficulty had emerged after discussion with the auditors which, if not resolved, would have been likely to have led to the accounts being qualified.[14] These were:

  • the need for a full review of capitalisation policy following the identification of inconsistencies in the 1998-99 'dry run' account;
  • difficulty in extracting accurate accruals data quickly from the Northern Ireland Office's systems; and
  • the absence of key members of staff with the necessary accountancy skills.

The last two points are being addressed as part of a review of the Northern Ireland Office's accountancy function.

11. A new timetable for the completion of the accounts was applied which required the audited accounts to be laid before the House by 31 March 2001. The Votes and Proceedings formally recorded their laying by the Department on 30 March as Cm 5058. This involved the provision of two typescript copies to the Journal Office, which were subsequently delivered by that Office to the Library. Copies were not generally available in the Vote Office until 27 April, some four weeks later.[15]

12. Although the technical minimum formal laying requirement was met by 31 March, we do not consider that the Northern Ireland Office, like a number of other departments, complied in practice with the spirit of the requirement to lay these accounts by 31 March 2001. We regard it as unfortunate that the material difficulties with these accounts were not identified earlier, with the result that their completion was significantly delayed. As a result, we were deprived of any opportunity to look at the accounts before the Vote on Account for 2001-02 had to be agreed by the House. We also regret that, given the prior interest we had displayed in the development of resource accounting, the Department was not pro-active in informing us of the difficulties it encountered subsequent to the evidence session, but left us to take the initiative in this matter. If a similar situation arises in future, we hope the Department will take the initiative and explain the problem and its proposed solution.

13. These criticisms notwithstanding, we congratulate the Northern Ireland Office on producing resource accounts for 1999-2000 that have received on unqualified opinion from the Comptroller and Auditor General. Not all departments have achieved this.[16]

5  Ev. p. 1. Back

6  Ev. p. 3. Back

7  Ev. p. 1. Back

8  Ev. p. 2. Back

9  See Q 6 to 30. Back

10  Q 5. Back

11  Q 23. Back

12  See paragraph 119 of the Memorandum from HM Treasury to the Treasury Committee, submitted on 22 January 2000. This was published by the Treasury Committee as HC 308-i (1999-2000); see p. 14. Back

13  The Vote on Account for the coming financial year is normally agreed by the House not later than 6 February (see Standing Order No. 55), typically in the preceding December. For the Vote on Account for 2001-02, the House agreed to defer the cut-off until 18 March 2001; see Official Report, 27 February 2001, Vol. 363, Cols. 854 to 876. The Treasury proposed such a deferment in February 1998, to allow Parliament an additional three months to scrutinise departments' 1999-2000 resource accounts before voting Supply on a resource basis for the first time. See HC 308-i (1999-2000), p. 14, paragraph 119. Back

14  Appendix 1, p. 26. Back

15  See also Appendix 2, p. 27. Back

16  See, for example, Cm.5055 and Cm. 5057. Back

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