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statement on the system of internal financial control
As Accounting Officer, I acknowledge my responsibility for ensuring that an effective system of internal financial control is maintained and operated by the Scottish Fisheries Protection Agency (SFPA).
The system can provide only reasonable and not absolute assurance that assets
are safeguarded, transactions authorised and properly recorded, and that material errors or irregularities are either prevented or would be detected within a timely period.
The system of internal financial control is based on a framework of regular management information, administrative procedures including the segregation of duties, and a system of delegation and accountability. In particular, it includes:
comprehensive budgeting systems with allocations to budget holders being agreed and kept under review by the Senior Management Board;
regular reviews by the Senior Management Board of periodic and annual financial reports which indicate financial performance against the forecasts;
setting targets to measure financial and other performance;
clearly defined capital investment control guidelines;
as appropriate, formal project management disciplines.
SFPA has an internal audit contract, which operates to standards defined in the Government Internal Audit Manual. The work of the internal auditors is informed by an analysis of the risk to which the Agency is exposed, and annual internal audit plans are based on this analysis. The analysis of risk and the internal audit plans are endorsed by the Agency's Senior Management Board and approved by me. At least annually, the Internal Auditors provide me with a report on internal audit activity in the Agency. The report includes the Internal Auditor's independent opinion on the adequacy and effectiveness of the Agency's system of internal financial control.
Separate internal audit reports were issued for each of the projects reviewed during the year summarising the extent to which each system is effectively controlled and detailing weaknesses identified, recommendations and a course of action agreed with management directly responsible for each project.
Overall, the systems reviewed were found to be well controlled with most of
the risks associated with each system adequately addressed by appropriate
control procedures. A brief follow-up review of the implementation of agreed action will be performed during the programme of work for 1999 - 2000.
My review of the effectiveness of the system of internal financial control is informed by the work of the internal auditors, the Senior Management Board which oversees the work of the internal auditors, the senior managers within the Agency who have responsibility for the development and maintenance of the financial control framework, and comments made by the external auditors in their management letter and other reports.
P E DU VIVIER
Chief Executive
8
July 1999
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