Skip to main content

Financial Auditing and Reporting: 1998-99 General Report of the Comptroller and Auditor General

Sir John Bourn, head of the National Audit Office, has reported to Parliament on the outcome of financial audit work undertaken in central government by his staff over the past year.
Sir John qualified his audit opinion on 13 accounts and reported on a further 13.

Sir John examines the progress made by Government departments and other bodies in developing resource accounts, which are similar to commercial financial reporting, on a dry run basis for 1998-99 and in a fully audited form from 1999-2000. He notes that a significant number of departments were still not fully prepared to produce resource accounts at stage 2 (opening balances) of the timetable for preparing resource accounts. He also noted that very few departments produced their 1998-99 accounts by the mid-August 1999 timetable set by the Treasury for stage 3 (dry-run accounts) and that some accounts were not received by the end of 1999.

Sir John notes that a consequence of the pressures on departments and agencies to prepare resource accounts is a continuation of the trend toward later submission of accounts, a trend he has reported on previously.

Performance measurement is assuming a much greater importance for bodies in central government, as a means of improving accountability and achieving better value for money. Validating performance information is a key factor in achieving these objectives and the National Audit Office are continuing to work with the Treasury to secure a creditable and effective system to do this. The Committee of Public Accounts, in considering the Government Resources and Accounts Bill currently being considered by Parliament, noted the need for independent validation of performance measurement to be placed on a systematic footing.

Sir John also reports on developments in corporate governance and the requirement for the 1998-99 accounting period for departments, agencies and other bodies to prepare and publish statements on the system of internal financial control with their accounts. Overall they have been introduced successfully with nearly all bodies preparing statements in the form required by the Treasury. It is also clear that the requirement to produce such statements has raised awareness of corporate governance issues generally within many bodies.

Other matters raised by Sir John in his report include:

  • the impact of Devolution in terms of changes to accountability and audit arrangements in the Public Sector; and
  • the results of a review of the National Audit Office of the performance of a sample of government departments and agencies in paying their suppliers promptly. The review found that only some 58 per cent of the organisations in the sample met the target of paying 95 per cent of their invoices within 30 days of receipt, and nearly one in four failed to achieve payment of 90 per cent of invoices within the same time.

"My General Report summarises progress on a number of important issues facing departments, including resource accounting, corporate governance and performance measurement. It is clear that they face major challenges in these areas, and the National Audit Office and I will continue to work with them to ensure that a robust system of audit and accountability to Parliament is secured".

Sir John Bourn

Notes for Editors


The Comptroller and Auditor General’s General Report is published annually with the Appropriation Accounts, which show expenditure by government departments and agencies from funds voted by Parliament. The 1998-99 report draws the attention of Parliament and others concerned to the outcome of the Comptroller and Auditor General’s audit of accounts for that year, and to current financial audit and accounting issues in the central government sector.


Press notices and reports are available from the date of publication on the NAO website at Hard copies can be obtained from The Stationery Office on 0845 702 3474.


The Comptroller and Auditor General, Sir John Bourn, is the head of the National Audit Office employing some 750 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.


PN: 18/00