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Sir John Bourn, head of the NAO, today welcomed the continued improvements made by departments in the quality of the accounts they submit for audit, although he noted that there was more they could do to avoid spending more resources than permitted by Parliament and to ensure that they were able to submit accounts for audit in a more timely manner.

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Sir John qualified his opinion on only half as many accounts for 2002/03 as in the previous year. Departments have made good overall progress in improving the quality of accounting and financial management and in reacting to the challenges of resource accounting. But concerns remain over the time taken by many departments to prepare and render accounts for audit. Sir John also warned that some departments still view the accounts production process as merely a year end activity, rather than as something that underpins effective in-year financial management and resource planning.

Progress towards whole of government accounts continues to be made. The first dry run of central government accounts was generally successful. Sir John welcomed the decision to proceed with the publication of whole of government accounts beginning from the year ending 31 March 2007.

Sir John also welcomed the orders made by the Treasury extending his statutory rights of access to those private sector bodies in receipt of public funds, and transferring the audits of a number of non-departmental public bodies to him.

The organisations audited by Sir John continue to make good progress in developing their corporate governance and risk management arrangements. By 31 March 2003, over 80 per cent of organisations were able to report that they had all the necessary procedures in place. For those remaining, the majority envisage full compliance by 31 March 2004.

The NAO continues to make a wider contribution towards improved financial management and effective internal control within audited bodies and is heavily involved in developing the wider accounting and auditing framework within which central government bodies operate.

"I am pleased by the improvements that I have seen in financial management across central Government in the past year and, in particular, by the strengthening of corporate governance arrangements. The NAO and I will continue to provide expertise as well as oversight in assisting further progress."

Sir John Bourn


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