Tuesday, March 16

Accounting Standards are driven by the Governments and their own accounts are not signed off

Accounting Standards are being driven by the governments across the world for corporates. If Governments had to follow corporate accounting standards, then people would have been in jail. So how many people have you heard who have been fired for bad accounting for years and decades? Think EU and other govts. And these people are responsible for setting standards for corporates. And they spend more than corporates. Good Heavens. Some examples:

1. Defense Ministry’s Accounting ‘Unacceptable,’ U.K. Panel Says

The U.K. Defense Ministry is guilty of administrative failures that have led to officials losing track of sensitive equipment and wasting hundreds of millions of pounds, a panel of lawmakers said.

The cross-party Defense Committee criticized the failure of the ministry to gain full approval for its accounts from the National Audit Office for the third successive year.


2. The Department for Work and Pensions’ numbers have been qualified for 17 years in a row.

And its not just that, here’s some more detail.

Accounts from the department of work and pensions, defence and the Equalities Commission were also qualified in reports slipped out amid a deluge of paperwork from Whitehall.

Morse said he declined to sign off the Treasury's resource accounts for 2008/09 because the department incurred £24bn more expenditure than Parliament authorised, arising from losses from the operation of the Asset Protection Scheme.

Morse also reported the Treasury's balance sheet showed the net of total assets, less liabilities, now stand at £44bn – up £2bn on 2007/08.

The NAO qualified the accounts of the DWP for the 20th consecutive year because they showed a net £2.7bn loss in fraud and error across all benefits except the state pension.

And Revenue and Customs' were subject to error and fraud in the tax credit system

totaling between £1.58bn and £1.84bn (up on the £1.31bn to £1.54bn in 2006/07).

Morse said he qualified the MoD's accounts because of a ‘net error’ of £140m in the amount a new computer system that allows servicemen and women to enter expense claims without further checks. There was missing radio and computer equipment worth £155m and a ‘significant risk of error’ over £14.1bn in raw materials and spares.

The Equality Commission’s accounts were qualified because £629,000 was spent paying consultancy fees to former staff whose departure terms excluded being rehired.

But the EU goes one better

3. EU’s spending of agricultural money and the structural fund, have been beset with so many difficulties that the court of auditors has not signed off the numbers for 12 years in a row. 

That was 3 years back. In 2009, they were still not signed off making it a grand total of 15 years.

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