Audit Committee, 21 Dec 2004
Meeting date: Tuesday, December 21, 2004
Official Report
335KB pdf
“The 2003/04 Audit of Historic Scotland”
Agenda item 3 is a briefing from the Auditor General for Scotland on his report under section 22 of the Public Finance and Accountability (Scotland) Act 2000, on the 2003-04 audit of Historic Scotland. Before we hear from the Auditor General, I mention to members that the report makes reference to a fraud case, in relation to which legal proceedings are active, so questions to the Auditor General must be on the broader issues that arise from the briefing. I will rule out of order questions on the specifics of the case.
The report is on the accounts of Historic Scotland for the 2003-04 financial year. It brings to the Parliament's attention an allegation of a sizeable fraud, which resulted in the suspension of a member of staff of Historic Scotland. A police investigation is currently going on. Historic Scotland considers that the suspected fraud might have been going on since 2001 and estimates the value at £112,000.
I am pleased to report that Historic Scotland appears to have taken prompt action in response to the fraud. An internal investigation uncovered a number of control weaknesses, which are being addressed. I expect the appointed auditor to monitor the action that has been taken, as part of the audit of the current year.
I am also able to say that the Scottish Executive has required all its executive agencies to examine their controls regarding such things as the segregation of duties and the use of the Government procurement card, which is also involved. That analysis and tightening of control are on-going.
As the convener indicated, there is a live court case and I will not be able to discuss in detail how the alleged fraud might have occurred, in light of the fact that a criminal prosecution might be considered at some stage.
The report states:
"Historic Scotland and the Scottish Executive have taken a number of steps to learn lessons and prevent recurrence."
Surely that means that the lessons learned in one area should be applied and tested throughout the Scottish Government system and assurances sought that effective financial checks and balances are in place throughout the system. What advice can you give us about ensuring that such lessons are being or will be applied throughout the system?
That is really a matter for the Scottish Executive. As I indicated, it has responded by taking a corporate initiative across the whole of the Scottish Executive. The auditors will be monitoring that and reporting as necessary.
If there are no further questions, that is item 3 covered. We will consider the section 22 report on Historic Scotland in private later in the meeting.