I certify that I have audited the financial statements of the House of Lords for the year ended 31 March 2010. These comprise the Statement of Parliamentary Supply, the Operating Cost Statement, the Statement of Financial Position, the Statement of Cashflows, the Statement of Changes in Taxpayers' Equity, the Statement of Operating Costs by Aim and Core Tasks and the related notes. These financial statements have been prepared under the accounting policies set out within them. I have also audited the information in the Remuneration Report that is described in that report as having been audited.

RESPECTIVE RESPONSIBILITIES OF THE ACCOUNTING OFFICER AND AUDITOR

As explained more fully in the Statement of Accounting Officer's Responsibilities, the Accounting Officer is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. My responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require me and my staff to comply with the Auditing Practices Board's Ethical Standards for Auditors.

SCOPE OF THE AUDIT OF THE FINANCIAL STATEMENTS

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the House of Lords' circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the House of Lords; and the overall presentation of the financial statements.

In addition, I am required to obtain evidence sufficient to give reasonable assurance that the expenditure and income reported in the financial statements have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them.

OPINION ON REGULARITY

In my opinion, in all material respects the expenditure and income have been applied to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them.

OPINION ON FINANCIAL STATEMENTS

In my opinion:

• the financial statements give a true and fair view of the state of the House of Lords' affairs as at 31 March 2010 and of its net cash requirement, net resource outturn, net operating cost, net operating costs applied to the House of Lords' aim and core tasks, changes in taxpayers' equity and cash flows for the year then ended; and
• the financial statements have been properly prepared in accordance with the House of Lords' Financial Reporting Manual.

OPINION ON OTHER MATTERS

In my opinion:

• the part of the Remuneration Report to be audited has been properly prepared in accordance with the House of Lords' Financial Reporting Manual; and
• the information given in the Foreword and the unaudited part of the Remuneration Report for the financial year for which the financial statements are prepared is consistent with the financial statements.

MATTERS ON WHICH I REPORT BY EXCEPTION

I have nothing to report in respect of the following matters which I report to you if, in my opinion:

adequate accounting records have not been kept; or

the financial statements are not in agreement with the accounting records or returns; or

I have not received all of the information and explanations I require for my audit; or

the Statement on Internal Control does not reflect compliance with HM Treasury's guidance.

REPORT

I have no observations to make on these financial statements.

Amyas C E Morse

Comptroller and Auditor General

National Audit Office

157-197 Buckingham Palace Road

Victoria, London, SW1W 9SP

22 July 2010