MoD accounts not signed off. Again.

[Al R]

Report of the Comptroller and Auditor General on the 2009-10 accounts of the Ministry of Defence

The MOD have been unable to provide evidence to support the existence and value of certain assets and inventory balances. In addition, the Department’s accounting policies are not fully compliant with International Financial Reporting Standards. "Despite action by the Department to improve its asset management and accounting, the issues I have identified are systemic and deep-rooted. The level of control exercised by the Department is not yet sufficient to enable me to provide an opinion on a significant proportion of assets reported in the financial statements."

Amyas Morse, head of the National Audit Office, 26 July 2010

Once or twice, fair enough (maybe, in times of crisis and financial and operational uncertainty). But this is now the fourth year on the trot.

[GOLF_BRAVO_ZULU]

As regards the "certain assets and inventory balances", I suspect that the weak link will be the professionals in the Defence Storage and Distribution Agency, again. Stores System 3 and the Base Ordnance Depot Management System, for various reasons, do not seem quite up to the task. We will probably find that the Naval Base held stores on the Comprehensive RNSTS Inventory System Project and the integrated Warehouse Information Technology System have been signed off, again.

Guess which one is being replaced by which. Funny old world.

[tucumseh]

the issues I have identified are systemic and deep-rooted.

It may only be 4 consecutive years by the CAG, but the root cause of these systemic problems were highlighted in 1987 (in the case of the RN - the RAF already had the problem) and were the subject of a very critical report in June 1996 by MoD's own internal auditors (who reported direct to PUS, the Chief Accounting Officer). This report made 19 recommendations. None were implemented.

It may seem like beancounting, but this has significance across procurement, especially in these days of "incremental acquisition", which frequently involves modifying what you have. By definition this means you need to know what you already have in order to quantify and then cost the modification. If you don't know what you have, then the programme can't be costed properly, which leads to (a) programme not being approved or (b) if it is approved, either cost escalation as you've bought too little or wastage as you've bought too much. Sound familiar?

As a former MoD Commercial Director, Mr Morse would be well aware of the above report. Wonder why he didn't mention it?

[EODFelix]

The shortfall in asset/inventory management IIRC relates to issues with the MERLIN/MAESTRO systems and also the further accounting for BOWMAN assets

[Al R]

The mistakes are just very basic ones. The fact that the MoD cannot conform to International Standards is bemusing, 4 years on. Perhaps this is a case of gamekeeper turning poacher and knowing where the skeletons are hidden.

This made me smile (if thats the correct word) though - nothing changes. On JPA..

Action has also been taken to address the issues identified last year of a lack of documentation and levels of error identified in the payment of allowances and expenses made via the Joint Personnel Administration system. This has meant that the C&AG has been able to remove the qualification of his opinion in this area although his qualification on deductions from pay for food and accommodation continues. There remains significant further work to be done to establish a robust control environment and ensure that processes are sound.

[Jabba_TG12]

"As regards the "certain assets and inventory balances", I suspect that the weak link will be the professionals in the Defence Storage and Distribution Agency, again. Stores System 3 and the Base Ordnance Depot Management System, for various reasons, do not seem quite up to the task. We will probably find that the Naval Base held stores on the Comprehensive RNSTS Inventory System Project and the integrated Warehouse Information Technology System have been signed off, again."


Certainly one of the weakest links, as the report highlights. Kinda figures that JPA would take a kicking, as would the issues with Bowman, but for the criticism of DSDA to be highlighted in the way it was must be galling for the service personnel who have to work alongside them both at Bicester and other locations. The problems are indeed deep rooted and systemic and show no real signs of being addressed with the likes of FLIS and MJDI being offered as the mythical baskets into which we should put all our eggs rather than ensuring that what we have got in the meantime is fit for purpose. The more things change....

I was rather hoping that when the LAIPT was shunted out of the way into the long grass that it belongs in, that the situation may improve and that the outsourcers looking after the likes of BODMS/WTMS, AMANDA, et al would be kept on a tighter leash - as the usual syndrome of the IPT getting too cosy with the supplier led, as ever to the end user's concerns being often ignored or over-ridden.... a problem oft observed at DSDA with a certain Teir1 telco/outsourcer.

However... not a chance of that with the current management in Building C16. Regrettably, the comments about the shortcomings of DSDA come as no surprise.