Source · Select Committees · Public Accounts Committee
Recommendation 19
19
Accepted in Part
NHS England and Department are addressing audit timeliness, but external factors still impact progress.
Conclusion
We challenged NHS England and the Department on the extent they were acting on the proposals to improve audit timeliness set out in their 2022–23 governance statements. NHS England stated that it had regular update meetings with all audit firms, as well as working with the Department and cross-government groups looking at local audit delivery. 24 Q 58 25 Qq 79, 84 26 Q 81 27 Q 94 28 Qq 83–84 29 Q 84; Report by the Comptroller and Auditor General, NHS England Annual Report and Accounts 2022–23, HC 468, 25 January 2024, page 135 14 Department of Health and Social Care2022–23 Annual Report and Accounts NHS England advised it worked closely with bodies where major financial reporting issues arise, citing University Hospitals Leicester as an example. NHS England also stated that some factors were outside of its control, such as Local Government Pension Scheme (LGPS) audits, the late delivery of which continues to impact some NHS provider audits. A small number of NHS providers have staff who are members of the LGPS, and their share of pension scheme assets and liabilities must be accounted for in the NHS provider account.30 30 Qq 79–82, 94, 96–102; Department of Health and Social Care, Annual Report and Accounts 2022–23, HC 33, 25 January 2024, pages 130–131; and NHS England, Annual Report and Accounts 2022–23, HC 468, 25 January 2024, pages 76–77 Department of Health and Social Care2022–23 Annual Report and Accounts 15 2 Departmental expenditure and planning for a future pandemic Clinical negligence
Government Response Summary
The government agrees with the committee's findings and is implementing a multi-year plan to gradually improve audit timeliness, targeting a return to pre-summer recess laying for the 2026-27 financial year, while acknowledging external challenges in the local audit system.
Government Response
Accepted in Part
HM Government
Accepted in Part
2.1 The government agrees with the Committee’s recommendation. Target implementation date: Summer 2027 2.2 The Department of Health and Social Care (the department) is implementing a multi-year plan which aims to bring forward the publication of its Annual Report and Accounts (ARA) by at least one month per year and targets a return to pre-summer recess laying for the 2026-27 financial year. For 2023-24 audit, the Department has jointly agreed with the NAO that C&AG certification should be planned for the end of November 2024 and laying before Parliament in early December 2024, which would be nearly two months earlier than the 2022-23 accounts were laid. 2.3 The department is actively engaging with key stakeholders across government and externally to address the ongoing capacity issues in the local audit system. Addressing these issues is critical to bringing forward the laying date of the ARA. In addition to audit firm capacity, the regulatory environment in which audit firms operate is creating further pressure on timetables as requirements on audit firms continue to increase. Noting that these challenges are not wholly within the control of the department to resolve, the achievement of pre-summer recess laying of the ARA will be challenging and there is no realistic prospect of this in the short term. In summary, the department will continue doing all it can to work towards a pre-recess laying of the ARA, recognising that this will be challenging and also depends on factors outside of the department’s direct control.