Source · Select Committees · Public Accounts Committee
Recommendation 7
7
Accepted
UKHSA claims understanding of financial control issues and progress on 2021-22 audit problems.
Conclusion
We asked UKHSA whether it had sufficient organisational understanding and acceptance of the level of cultural change and process improvement required to fix these issues with its accounts. UKHSA responded that it understood and accepted this. It drew a distinction between the issues which had resulted in its 2022–23 accounts being disclaimed, and those which had resulted in its 2021–22 accounts being disclaimed, which it asserted were “quite different”. It stressed that, in 2021–22, it was a new organisation and had “inherited a number of issues on coming into being” and that it had made “very good progress” in trying to address the issues that had led to its 2021–22 accounts being disclaimed. It also told us that one of the issues it had encountered in its 2022–23 accounts was that it had “very little headroom because of the disclaimed accounts last year”, as well as a separate issue with its covid vaccine model. It explained that it had set up a Finance Control and Improvement Board, chaired by the Accounting Officer, and set up required governance arrangements that were not in place in the prior year.9
Government Response Summary
The government agrees with the committee's observation and commits to achieving an improved (though qualified) audit opinion for UKHSA's 2023-24 accounts by November. It details a comprehensive audit plan, external support from PWC, and an ongoing Finance and Control Improvement Programme.
Government Response
Accepted
HM Government
Accepted
1.1 The government agrees with the Committee’s recommendation. Target implementation date: January 2025 1.2 Following its 2021-22 disclaimed accounts, the UK Health Security Agency (UKHSA) established a Finance and Control Improvement Programme to develop, implement and embed a robust programme of work to support the production of auditable accounts. While UKHSA received a further disclaimed audit opinion for its 2022-23 accounts, the Comptroller and Auditor General recognised the improvements that had already been made in UKHSA’s financial controls and emphasised that the work of the programme should be accelerated. 1.3 There is now greater confidence both within UKHSA and DHSC of an improved audit opinion for the 2023-24 accounts. While an unqualified opinion is not possible this year due to the prior year disclaimer, we are working hard to produce quality, auditable accounts and to have certification from the NAO in November. UKHSA will then target laying its annual report and accounts pre-summer recess, without any qualifications, at the earliest opportunity. 1.4 A comprehensive audit plan is in place for UKHSA, agreed with the NAO, to support the 2023-24 audit process and in particular, the resolution of the specific 2022-23 Covid Vaccines Unit issue. PWC have been engaged by UKHSA to provide external support and third-party verification to the 2023-24 audit.