A new report by the National Audit provides a timely warning to any public sector unit thinking of contracting out its finance function. The NAO has produced a report on the Public Health Laboratory Service Board Accounts for 1998-99, where financial control broke down after the contract went live in April 1998.The report shows failure, by the contractor CSL Ltd, to perform timely and complete bank reconciliations, inaccurate accounting records for debtors and cash, and poor controls over the making of payments for goods and the creation of creditors on the CSL accounting system. Since then the Board and CSL have taken steps to recover, and earlier this year the Board commissioned an external accounting firm to review all the major financial systems in place at CSL. There is confidence the system is now under control.

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A new Government report praises forty-five examples of modernisation seen to have improved practice. Citizens First, the modernising government annual report produced by the Cabinet Office, attempts to find progress across many sectors.Kirklevington Grange and Holme House prisons, Teesside, are saluted for their enterprising work with prisoners -they have set up a ‘passport’ service to help prisoners collect and complete all the necessary forms they need to put them on a crime-free track on finishing their sentence.

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