Magazine article Public Finance

Local Government 'Sacrificing Quality' When Preparing Accounts

Magazine article Public Finance

Local Government 'Sacrificing Quality' When Preparing Accounts

Article excerpt

Public sector organisations lag far behind their private sector counterparts when it comes to accurate and timely financial reporting, auditors said this week.

The Audit Commission said action was needed to improve the present situation where a quarter of councils have to resubmit their accounts because of errors. This is a deterioration on last year's figure of one in five.

'Because local authorities are being required to produce accounts earlier they are focusing on speed and sacrificing quality in that process,' Audit Commission chief executive Steve Bundred told Public Finance.

Matters are better in the NHS, where auditors reported a significant improvement in 2004 compared with the previous year. But concerns remain about the quality of accounts at 18% of primary care trusts.

Bundred said it was disappointing that managers in both local government and the NHS were not taking their financial reporting responsibilities seriously enough.

'In local government, there is no requirement to have internal audit committees, whereas in the NHS audit committees are standard,' Bundred said. …

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