Annual Audit Letter

D-Harold

Description

Annual Audit LetterNational Probation Service - Teesside Audit 2007/08 November 2008 Contents Summary 3 Purpose, responsibilities and scope 4 Audit of the accounts 5 Use of resources 6 Closing remarks 8 Status of our reports The Statement of Responsibilities of Auditors and Audited Bodies issued by the Audit Commission explains the respective responsibilities of auditors and of the audited body. Reports prepared by appointed auditors are addressed to non-executive directors/members or officers. They are prepared for the sole use of the audited body. Auditors accept no responsibility to: • any director/member or officer in their individual capacity; or • any third party. TTTSummary Summary Key messages 1 I issued an unqualified audit opinion on the Board's 2007/08 accounts on 24 July 2008. Prior to this, an interim letter of assurance was sent to the National Offender Management Service (NOMS) by the deadline of 27 June 2008, because the information from the Pension Fund auditor was not available in sufficient time. 2 In 2008/09, it is likely that the national deadline for production of the financial statements will be brought forward, and the transitional arrangements leading to the implementation of new International Financial Reporting Standards will also have an impact. The Board should consider how arrangements with the Pension Fund Authority can be improved to enable earlier release of information required for the accounts ...

Informations

• Publié par: Usle
• Nombre de lectures: 11
• Langue: English

Extrait

Annual Audit

Letter

National Probation Service - Teesside

Audit 2007/08

November 2008

Status of our reports

The Statement of Responsibilities of Auditors and Audited Bodies issued by the Audit

Commission explains the respective responsibilities of auditors and of the audited body.

Reports prepared by appointed auditors are addressed to non-executive

directors/members or officers. They are prepared for the sole use of the audited body.

Auditors accept no responsibility to:

•

any director/member or officer in their individual capacity; or

•

any third party.

Contents

Summary

3

Purpose, responsibilities and scope

4

Audit of the accounts

5

Use of resources

6

Closing remarks

8

TTTSummary

Summary

Key messages

1

I issued an unqualified audit opinion on the Board's 2007/08 accounts on

24 July 2008. Prior to this, an interim letter of assurance was sent to the National

Offender Management Service (NOMS) by the deadline of 27 June 2008, because the

information from the Pension Fund auditor was not available in sufficient time.

2

In 2008/09, it is likely that the national deadline for production of the financial

statements will be brought forward, and the transitional arrangements leading to the

implementation of new International Financial Reporting Standards will also have an

impact. The Board should consider how arrangements with the Pension Fund Authority

can be improved to enable earlier release of information required for the accounts and

audit.

3

I concluded that the Board did have proper arrangements in place to secure economy,

efficiency and effectiveness in its use of resources against all seven specified criteria.

4

The Board achieved an underspend of £36,000 against its resource limit of

£13.65 million in 2007/08, with an agreed carry forward under the budget exchange

scheme of £30,000.

Recommendation

R1

The Board should liaise with the Pension Fund Authority to enable timely release of

financial information for inclusion in the financial statements 2008/09.

3

National Probation Service - Teesside

TTTPurpose, responsibilities and scope

Purpose, responsibilities and

scope

5

This Annual Audit Letter (letter) summarises the key issues arising from our work

carried out during the year. I have addressed this letter to Board members as it is the

responsibility of the Board to ensure that arrangements are in place for the conduct of

its business and that it safeguards and properly accounts for public money. I have

made recommendations to assist the Board in meeting its responsibilities.

6

The letter also communicates the significant issues to key external stakeholders,

including members of the public. I will publish this letter on the Audit Commission

website at

www.audit-commission.gov.uk

.

7

I have prepared this letter as required by the Statement of Responsibilities of Auditors

and Audited Bodies issued by the Audit Commission. This is available from

www.audit-commission.gov.uk

.

8

As your appointed auditor I am responsible for planning and carrying out an audit that

meets the requirements of the Audit Commission’s Code of Audit Practice (the Code).

Under the Code, I review and report on:

•

the Board's accounts; and

•

whether the Board has made proper arrangements for securing economy,

efficiency and effectiveness in its use of resources.

9

This letter summarises the significant issues arising from both these areas of work.

The closing remarks section at the end of this letter details reports issued to the Board

relating to the 2007/08 audit.

National Probation Service - Teesside 4

TTTAudit of the accounts

Audit of the accounts

10

I issued an unqualified opinion on the financial statements on 24 July 2008. In advance

of this I issued an interim letter of assurance to NOMS prior to the deadline of 27 June,

as the Pension Fund auditor assurance was not received in sufficient time to complete

the audit. This is because local government and pension fund deadlines are later than

those for probation boards. In my opinion:

•

the financial statements give a true and fair view of the probation board's financial

affairs and of its net operating costs for the year; and

•

in all material respects the expenditure and income have been applied in

accordance with relevant authorities.

11

Before giving my opinion, I reported to the Board on the issues arising from the

2007/08 audit. I issued this report on 23 June 2008, followed by an updated letter to

the Board prior to giving the opinion on 24 July 2008.

12

There were no material unadjusted errors. During the audit, several non-material

adjustments to the accounts were made resulting in a reduction to net operating costs

of £79,000.

13

Going forward, we recognise the challenge to the joint finance team for Teesside and

Durham Probation Boards of preparing two sets of accounts to potentially earlier

deadlines for production of the financial statements. Next year's deadlines are likely to

be earlier; in addition, the subsequent year will see the change to the new International

Financial Reporting Standards. We will work closely with the Treasurer to ensure

deadlines are met whilst maintaining the quality of the financial statements.

5

National Probation Service - Teesside

TTTUse of resources

Use of resources

Financial position

14

The Board continues to operate within tight financial constraints.

15

Expenditure in 2007/08 was contained within the resource limit of £13.650 million, with

a £36,000 underspend and £30,000 carried over to 2008/09 under the agreed budget

exchange scheme.

This compares with the underspend carried forward from 2006/07

of £207,000 against a resource limit of £13.025 million.

Value for Money conclusion

16

I have assessed the arrangements of the Board as adequate in all seven areas

specified by the Audit Commission and concluded that the Board had proper

arrangements in place to secure economy, efficiency and effectiveness in the use of

resources. The assessment has considered the following areas:

Table 1

Value for money conclusion criteria

•

Monitoring and reviewing performance

•

Maintaining a sound system of internal control

•

Risk management arrangements

•

Managing and improving value for money

•

Matching resources and spending

•

Matching performance against budgets

•

Ensuring probity and propriety

17

Looking forward, the Board faces further change with the increased sub-regional

collaboration between Durham and Teesside Probation Boards, potential transition to

Trust status and the introduction of the Best Value regime for probation boards. We

have made recommendations arising from our VFM conclusion work to both help

support continuing improvement and to prepare for future changes:

•

publish the Annual Report on the external website (once the website is developed);

•

continue to keep under review the adequacy of governance arrangements in

response to changes arising out of increased sub-regional collaboration;

National Probation Service - Teesside 6

TTTUse of resources

•

ensure updated Standing Orders and Financial Regulations are made available to

all staff; and

•

ensure that all policies and procedures are updated upon any transition to Trust

status.

National Fraud Initiative

18

Since 1996 the Audit Commission has run the National Fraud Initiative (NFI), an

exercise that matches electronic data within and between audited bodies to prevent

and detect fraud. This includes police authorities, local probation boards, fire and

rescue authorities as well as local councils. To date, an estimated £450 million of fraud

and overpayments have been identified from this work nationally and the initiative has

attracted international recognition.

19

This data matching exercise identifies inconsistencies or other circumstances that

might indicate fraud or error. It also helps auditors to assess the arrangements that

audited bodies have put in place to deal with fraud.

20

As well as the benefit of these savings, the NFI process also gives assurance to

Boards that action is being taken to tackle instances of fraud. The Board has again

engaged well with the process and no specific instances of fraud were identified.

Although complete protection against fraud is not possible, this work contributes to the

assurance the Board has that controls over fraud have operated adequately.

7

National Probation Service - Teesside

TTTClosing remarks

Closing remarks

21

I have discussed and agreed this letter with the Chief Probation Officer

and the

Director of Finance. I will present a copy of the letter at the Probation Board in

December 2008, and provide copies to all Board members.

22

Reports issued to the Board are listed below.

Table 2

Report

Date of issue

Audit plan

March 2007

Annual Governance Report (updated by supplementary

letter to the Board 21 July)

June 2008

Interim letter of assurance to NOMS

27 June 2008

Audit Opinion on the accounts and VFM conclusion

24 July 2008

Annual audit letter

December 2008

23

The Board has again taken a positive and constructive approach to our audit. I would

like to thank the Board and in particular the Director of Finance and his team for their

help and cooperation during the audit.

Lynne Snowball

District Auditor

November 2008

National Probation Service - Teesside 8

The Audit Commission

The Audit Commission is an independent watchdog, driving economy, efficiency and

effectiveness in local public services to deliver better outcomes for everyone.

Our work across local government, health, housing, community safety and fire and rescue

services means that we have a unique perspective. We promote value for money for

taxpayers, covering the £180 billion spent by 11,000 local public bodies.

As a force for improvement, we work in partnership to assess local public services and

make practical recommendations for promoting a better quality of life for local people.

Copies of this report

If you require further copies of this report, or a copy in large print, in Braille,

on tape, or in a language other than English, please call 0844 798 7070.

© Audit Commission 2008

For further information on the work of the Commission please contact:

Audit Commission, 1st Floor, Millbank Tower, Millbank, London SW1P 4HQ

Tel: [phone]

Fax: [phone]

Textphone (minicom): 0844 798 2946

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