Spending of agri-food institute fell short of standards: auditor

A PUBLIC body has been criticised after auditors found failures in governance in its spending.

It follows an examination of the accounts of the Agri-Food and Biosciences Institute (AFBI).

A report published today said some financial practices at AFBI showed a fundamental disregard for the principles of public sector accounting.

The institute provides high-level scientific services to customers in the agri-food sector.

Today’s report by Auditor General Kieran Donnelly flags issues with its 2016/17 accounts.

It highlights failures in governance within AFBI which led to material financial transactions that were outside accepted practice in public sector financial management.

During 2015/16 AFBI entered into an agreement with the Centre for Innovation and Excellence in Livestock (CIEL), a collaboration aimed at delivering industry-led research to make the livestock sector more efficient.

Concerned: Kieran Donnelly

In 2015/16 and 2016/17 AFBI issued sales and pro-forma, or estimated, invoices worth £1.8m to CIEL.

AFBI provided these invoices for CIEL to secure funding in advance of year-end deadlines for eligible spending. The invoices were intended to ensure that AFBI would be able to maximise funding in future years.

However, no assets had been bought by AFBI at that time.

Mr Donnelly said the use of these invoices was “concerning”, and outside the accepted practice in public sector accounting.

His report adds: “AFBI failed to disclose their existence over several months during the course of the audit ... What is of most concern is that these actions were taken with the full knowledge of senior management and authorised by AFBI’s [then] chief executive(s).”

The report states this was behaviour and standards “that fall far short of those a public sector body should display”.

The report notes the arrangement with CIEL was a new way of working for AFBI.

A spokesperson for AFBI said: “AFBI has been working closely with the NIAO on the audit of the Annual Report & Accounts for the financial year 2016/17 accepting all recommendations arising from the NIAO report and identifying a number of actions to be undertaken to ensure that all recommendations are implemented fully.”

AFBI falls under the remit of the Department of Agriculture, Environment and Rural Affairs (DAERA). It said: “The department has been working closely with AFBI’s executive management team to ensure that these significant control issues are robustly addressed.”