Accounting Standards

National Citizen Service reported for drawing out ‘unnecessary funds’

The Comptroller & Auditor General has issued a report to Parliament stating that the National Citizen Service breached cash management guidance in 2019-20

The National Citizen Service (NCS) has been reported to Parliament by the Comptroller and Auditor General for drawing out “unnecessary funds” in 2019-2020, breaching guidance relating to cash management.

Last month, Gareth Davies, the Comptroller and Auditor General (C&AG) and head of the National Audit Office (NAO), issued a report to Parliament concerning the NCS’ management of public funds during the year ended 31 March 2020. 

In 2019-2020, NCS’s funding primarily consisted of £158.6m of grant-in-aid from DCMS, with the majority of its other income of £3.5m originating from the small fees paid by participants on NCS programmes. 

According to Davies, the NCS maintained a cash balance significantly greater than operational requirements during 2019-20 and did not adjust the drawdown requests it made of DCMS. 

Oliver Simms, manager for Public Sector Audit & Assurance at the Institute of Chartered Accountants in England and Wales, said: “The Comptroller & Auditor General’s reporting powers are a valuable tool, as they allow him to report issues to Parliament even if an issue is not material to his audit opinion. 

“The National Citizen Service Trust has reacted positively and already taken steps to reduce their excess cash balance and to strengthen cash management.”

He added: “The reported breach of Cabinet Office spending controls in 2020-21 suggests that the Trust has more work to do in strengthening financial controls to ensure that adequate processes are in place to comply with applicable guidance and ensure it uses taxpayers’ money effectively.”

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