Framework for Reporting by the Comptroller and Auditor General

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1 1 Framework for Reporting by the Comptroller and Auditor General Financial Accountability of Public Bodies Government departments and State bodies are responsible for the conduct of public business within their respective remits, and for spending and safeguarding public money. Such public bodies are accountable to Dáil Éireann, and through Dáil Éireann to the public, for ensuring that the business is conducted in accordance with the law and with proper standards of accounting and governance, and that public money is used economically, efficiently and effectively. Public audit Article 33 of Bunreacht na héireann provides for the existence a Comptroller and Auditor General (C&AG) to audit all accounts of moneys administered by or under the authority of the Oireachtas and who shall report to Dáil Éireann at stated periods as determined by law The Comptroller and Auditor General (Amendment) Act 1993 (the Act) sets out the general legislative framework for his/her auditing work, and how such work must be reported. (Some additional specific/specialised functions are defined in individual acts e.g. the NAMA Act, the Central Bank Acts but these broadly reflect the provisions of the 1993 Act.) The following diagram summarises the reporting provisions that exist for the various aspects of the C&AG s audit remit. Overview of Reporting by the C&AG Financial/ revenue audit Regularity, propriety and governance reviews VFM examinations Specific issue reports General issues Audit opinion/ emphasis of matter Audit certificates Report on the Accounts of the Public Services (Central Gov Depts only) Special reports

2 2 Report on the Accounts of the Public Services Section 3 (10) of the 1993 Act requires the C&AG to present a report to Dáil Éireann by end September each year. This must be presented simultaneously with all of the audited appropriation accounts (about 40 accounts). This means that the accounts of all such central Government departments and offices are published by the C&AG, rather than by the bodies themselves. The Section 3 (10) report (referred to as the Report on the Accounts of the Public Services) requires/allows the C&AG to report annually directly to Dáil Éireann on any matters s/he considers appropriate arising from the audits of the appropriation accounts, including any concerns about the internal accounting controls operated by departments the results of examinations carried out on the accounts of the receipt of revenue of the State generally (but not exclusively) those collected by the Revenue Commissioners. Some specific legislative provisions require the C&AG to report additionally in the Section 3 (10) report on the accounts of public bodies specifically the National Treasury Management Agency and the Fiscal Advisory Council. A chapter is also provided each year in the section 3 (10) report on the main results of the audited annual Finance Accounts. The section 3 (10) report is structured each year to reflect the various sources of the material reported. (Annex A is a copy of the 2015 report table of contents, which illustrates this.) Audit Reports/Certificates Following the audit of the financial statements of a non-departmental State body, the C&AG produces an individual audit report or audit certificate. The report/certificate is issued to the audited body, which is obliged to send the certificate and the related accounts to the relevant Minister. The Minister is in turn obliged to present the accounts and report to the Houses of the Oireachtas. Each financial audit report reflects the relevant statutory provisions for the State body s financial accounting and audit, and typically includes an opinion on the completeness and accuracy of the accounts (e.g. accounts give a true and fair view or are properly presented) confirmation that all information and explanations considered necessary for the purposes of the audit has been obtained an opinion regarding the adequacy of the accounting records kept by the entity confirmation that the accounts are in agreement with the accounting records (where appropriate), exception reports e.g. where public money has not been used in a regular/compliant manner; or there is a material departure from standards set for the conduct of public business. Annex B is the 2013/2014 audit certificate for NUIG, which illustrates the structure of the report.

3 3 Audit certificate supplements Section 7 of the 1993 Act (as amended) provides for the C&AG to audit the financial statements of the Education and Training Boards. In that case, the Act provides for the C&AG to issue an audit certificate and, where s/he considers it appropriate, to also produce a separate report on any matter(s) of concern around control or regularity of spending arising from the audit of the Board. Such reports are attached to the audit certificate (and referred to as audit supplements ). This is modelled on the framework for reporting on matters arising from the audit of the appropriation accounts. A difference is that the report is formally presented to the Oireachtas by the Minister, rather than by the C&AG. The option of producing an audit supplement-type report is not available to the C&AG in relation to the audit of non-departmental State bodies or of departmental funds. As a result, the general approach the C&AG s Office takes to exception issues in such cases is to encourage the audited body in line with their financial reporting obligations to disclose the relevant facts in the financial statements or the statement on internal financial control, and the audit report/certificate then makes a cross reference to the relevant section(s). A concern identified during a financial audit that potentially may result in an audit certificate exception reference (or supplement report) often results in delay in the completion of the audit until the relevant facts have been reliably established, and the extent of the required disclosures is agreed with the audited body. Special Reports of the C&AG Section 11 of the 1993 Act provides for the C&AG to compile a special report, where s/he considers it appropriate to do so, in relation to the findings of a value for money examination (carried out under section 9 of the 1993 Act) or of an inspection of a State grant-funded body (under section 8 of the 1993 Act), or any general matter arising in relation to audits, inspections or examinations. The 1993 Act does not define the term any general matters arising in relation to audits, inspections or examinations. In practice, it is taken to mean an issue of concern that arises in the audits of a number of agencies e.g. a significant level of non-competitive procurement, weaknesses in the management of grant-funding provision or oversight, a novel form of fraud, the handling of severance payments, etc. Unlike the report on the accounts of the public services, the C&AG does not present his/her special reports directly to Dáil Éireann. Instead, such reports must be presented to the relevant Minister, who is then obliged within 3 months of the date of receipt of the report, to ensure that it is presented to the Dáil. Office of the Comptroller and Auditor General 9 May 2017

4 4 Annex A Report on the Accounts of the Public Services 2015, Table of Contents Central Government 1 Exchequer Financial Outturn for Government Debt 19 Voted Expenditure 3 Vote Accounting and Budget Management 33 4 Central Government Funding of Local Authorities 47 5 Progress under the Land Aggregation Scheme 59 6 Procurement and Management of Contracts for Direct Provision 67 7 EU Refunds and Levies in the Agriculture Sector 85 8 Disposal of Government Jet 97 9 Regularity of Social Welfare Payments Roll-out of the Public Services Card Guardian ad Litem Service 127 Revenue 12 Tackling Fuel Laundering Revenue s Review of Medical Consultants Tax Affairs Research and Development Tax Credit Taxpayer Compliance Deferral of Tobacco Stamp Liability 213 Other Matters 17 Accounts of National Treasury Management Agency Irish Fiscal Advisory Council 233

5 5 Annex B Audit Certificate of NUIG, 2013/2014

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UNCLASSIFIED. Framework Agreement

UNCLASSIFIED. Framework Agreement UNCLASSIFIED Framework Agreement September 2011 Revised as of 1 September 2013 to take account of the commencement of relevant sections of the Protection of Freedoms Act 2012 under the Protection of Freedoms