HMSO accounts showed lack of proper procedure

The National Audit Office yesterday highlighted a lack of financial control over the accounts of Her Majesty's Stationery Office prior to its privatisation last year, and qualified the figures because of poor procedure.

HMSO was sold in September, but prior to that it had been divided up into 14 business units. While the units were responsible for their own invoicing, payments were made to HMSO's central bank account, and therefore it was difficult to reconcile payments with invoices. As a result, pounds 1.6m is being held in a temporary account because it has not been matched to particular debtors.

The Comptroller General, Sir John Bourn, also qualified the accounts because of "an unresolved net imbalance of pounds 482,000" on trading between HMSO's business units. He said: "there was no effective system of control over the accounting of for these inter-business transactions."

The terms of the sale, which raised pounds 54m, are the subject of a separate NAO inquiry. The NAO points out that a number of outstanding claims against HMSO were transferred to the Cabinet Office before the sale went through, including one for pounds 3.7m by Siba Systems Ltd, over an alleged breach of public procurement rules, but this was subsequently dropped.