department of finance external review of the compilation ... · pdf file3 external review of...

8th May 2012

Department of Finance

External Review of the

Compilation of General

Government Debt Statistics

1 External Review of the Compilation of General Government Debt

Contents

1. Background and Approach .................................................................................. 2

2. Summary and Key Conclusions ........................................................................... 4

3. Overview of the GGD Reporting Process ............................................................ 8

4. Review Framework ............................................................................................ 11

5. Organisation ...................................................................................................... 13

6. Process and Systems ........................................................................................ 19

7. Communication .................................................................................................. 22

8. Resourcing ........................................................................................................ 24

9. Data Management ............................................................................................. 26

10. Statement of Responsibility ............................................................................... 28

Appendix A – Abbreviations ..................................................................................... 29

Appendix B – RACI Models ...................................................................................... 30

Appendix C – List of Recommendations .................................................................. 32


1. Background and Approach

1.1 Introduction

Following the identification of a €3.6 billion statistical reporting discrepancy in the General Government Debt (GGD) in October 2011, two reviews were initiated by the Department of Finance (the Department):-

1. An internal management review (Internal Review) which focused on the specific

circumstances surrounding the statistical reporting discrepancy. 2. An external review to, inter alia, examine the respective roles of the key agencies

involved in the calculation and reporting of GGD, and to make recommendations for improvement in the related processes, governance and organisation arrangements.

Following a selection process Deloitte & Touche (Deloitte) was engaged by the Department to undertake the external review. This Report represents the output of our review.

1.2 Terms of Reference

The Terms of Reference were as follows:-

Review the respective roles of the Department of Finance, the CSO and the NTMA in the compilation of the General Government Debt figures;

Review the inter-action between all three organisations, including communications processes;

Drawing on the findings of the Internal Review, this process should summarise the reasons for the error with regard to processes, systems, staffing, and control issues; (Individual staff performance is excluded from the scope of this review), and

Making recommendations, if any, to (for example):

– improve the inter-action between the three organisations, including the development of a communications protocol for all three organisations;

– clarify and, if appropriate, reallocate the responsibilities for the compilation and reporting of the General Government Debt;

– restructure the systems and work flows/responsibilities within the relevant areas of each of the three organisations;

– identify system wide issues in this regard for more general applicability; and – enable mistakes to be picked up in the system through appropriate checks and

balances

A Steering Group comprising representatives of the Department, the National Treasury Management Agency (NTMA) and the Central Statistics Office (CSO) was appointed to support our work. It was subsequently agreed to amend the Terms of Reference to include consideration of the respective roles of other agencies, where necessary.


It should be noted that while we used the Internal Review Report as an input to our work we did not validate its findings or re-perform underlying analysis. The focus of the Internal Review Report was an examination of the specific events surrounding the statistical discrepancy, whereas our work examined the process for the calculation and reporting of GGD more broadly focusing on the roles, responsibilities, interactions and process. Our review focussed on the processes supporting the calculation and reporting of GGD statistics. We did not test, audit or verify the calculations or reports issued.

1.3 Our Approach

The approach to this External Review is summarised in the Figure 1.1 below. The key focus of our work was to make recommendations for improvement in the workflows, roles and responsibilities, communications, and governance and organisation arrangements in the process for the calculation and reporting of GGD, in order to minimise the risks of similar issues recurring in the future. In undertaking this Review we met with various members of management and staff from the Department, the NTMA, the CSO and the Housing Finance Agency (HFA).

Figure 1.1 – Approach to the External Review

1.4 Acknowledgements

Deloitte wish to thank the members of the Steering Group, and the members of management and staff in the Department, the NTMA, the CSO and the HFA for their support and cooperation through the course of our work.


2. Summary and Key Conclusions

2.1 Summary of the Reasons Giving Rise to the Statistical Reporting Discrepancy

The conclusions set out in the Internal Review Report provide the background as to the reasons for the error with regard to processes, systems, staffing, and control issues. The following is a brief synopsis thereof.

The calculation of GGD is carried out by both the Department and the CSO independently of each other. The joint responsibility of the Department and the CSO for a range of historic statistics means that there is considerable duplication of effort between the two Offices.

There are a number of agencies and bodies involved in the compilation of statistics for National Debt and GGD, and there was a shortfall in documentation setting out the specific roles of each of the bodies involved.

Although other Government entities supplied information to the Statistics Unit (of the Department), this was not the case for the HFA and the Statistics Unit relied on the CSO to provide this data.

The compilation of figures on GGD is a complex process with expertise centered in a small number of people.

GGD work has increased significantly since 2010 as a result of increased reporting responsibilities to the Troika and, for example, additional classification issues resulting from the recapitalisation of the banking sector.

The current systems carry a significant risk of errors or omissions occurring and this has increased considerably in recent years due to increased pressure generally within the Central Budget Office.

The Statistics Unit relies on a wide range of inputs from the CSO, the NTMA, DPER and other central and local Government bodies and relies on the professional support and advice which the seconded Statistician receives from his colleagues in the CSO.

2.2 Summary Conclusion

The Internal Report notes in Section 2.8.2 that “The double count error and the circumstances outlined in this report in relation to expert knowledge, management oversight, inter-agency dependencies, information and communication flows and risk factors highlight areas where improvements are possible. Existing procedures can be enhanced, exposures to errors and vulnerabilities in systems can be reassessed and controls updated to provide greater assurance that all reasonable steps have been and are being taken to address key risks”.

The work undertaken as part of our review supports this assessment, and our recommendations set out a series of actions that should address the relevant issued around governance, processes, communication, resource levels and data management practices that underlie the current process and contributed to the issues under review.


2.3 Summary Recommendations

Applying this general conclusion to our Review Framework which sets out key principles (see Section 4.1), we would make the following summary observations and refer to 20 recommendations detailed in the body of our report. This summary and the relevant sections of the Report, by their nature, highlight weaknesses and areas where improvements can be made. Nevertheless, it is noted that this is a complex area of work, which in recent years has been subject to additional resource and reporting pressures. Staff are committed and work to tight deadlines.

Principle Observation Summary of

Recommendations

Section

Reference

Effective

Organisational

Arrangements

Whilst organisations

were able to manage

workloads with resource

constraints and time

pressures, there were

general deficiencies in

organisational

arrangements and in

particular a lack of

clearly defined roles and

responsibilities, and

governance structures.

There was a lack of an

overarching quality

assurance programme

across the relevant

agencies, and the GGD

reporting process did not

fall within the scope of

work or consideration of

internal audit or the Audit

Committees in the

Department or CSO.

It is noted that at the time

the potential error was

first raised in 2010 there

were particular pressures

on many parties involved

in the process.

The statistical techniques

and procedures in use

within the CSO are not in

question and it is noted

that Eurostat, in its

Dialogue Visits, has not

raised any issues in this

regard,

The CSO should take

overall responsibility

for GGD reporting,

subject to the specific

requirements of the

Department in relation

to current year and

forecast EDP debt.

A more robust

governance structure

and clearly defined

roles and

responsibilities should

be put in place for the

organisations in

relation to this work.

The GGD process

should come within the

scope of work of the

internal audit functions

and Audit Committees

in the Department and

CSO.

Section 5

7 Recommen-

dations

(5A – 5G)


Principle Observation Summary of

Recommendations

Section

Reference

Efficient

Processes &

Systems

To a large extent

processes and systems

were inefficient, involved

duplication, and lacked

documentation.

There was no systematic

reconciliation process for

inter-agency

transactions.

The risk of incorrect

calculation and/or

reporting of GGD had not

featured on the risk

registers of either the

Department or CSO.

Improved process

documentation and

procedures should be

developed.

A reconciliation

process for inter-

agency transactions

should be put in place.

Management should

review their risk

registers to consider

what, if any, updates

are necessary in

relation to the

calculation and

reporting of key GGD

data.

Section 6

5 Recommen-

dations

(6A – 5E)

Clarity of

Communications

Communication was

generally informal.

There were no inter-

agency service level

arrangements and no

formal process for issue

escalation and

resolution, relying

instead on judgement as

to when to escalate

matters to a more senior

official.

Formal

communications

protocols, inter-agency

service level

agreements and issue

management

processes should be

improved.

Section 7

3 Recommen-

dations

(7A – 7C)

Appropriate

Resourcing

Resource levels appear

to have been under

pressure and there was

no formal training for

Department staff in what

is a technically complex

area. CSO staff did

receive training via

various Eurostat

courses.

Resource levels and

capability to be

reviewed by

management as a

matter of priority.

A training / technical

update programme

should be put in place

on at least an annual

basis.

Section 8

3 Recommen-

dations

(8A – 8C)

Data Integrity Data collection templates

were inadequate, and

there is no central data

repository.

Data collection

templates to be

updated and

consolidated.

Enhanced document

management

techniques should be

adopted.

Section 9

2 Recommen-

dations

(9A – 9B)


It is important to note that in some instances the relevant parties have begun to address key process issues already, and that this commenced as soon as the GGD statistical discrepancy came to light.

2.4 Implementation

As noted above, we have recommended that the CSO should take overall responsibility for GGD reporting, subject to the specific requirements of the Department in relation to current year and forecast EDP debt. We have also recommended that an active governance structure be put in place representing all key agencies, to ensure that the overall process for the classification and reporting of GGD is managed in an appropriate manner taking on board the recommendations of this review. Therefore the CSO, with support from the governance group referenced above should, in our opinion, take lead responsibility for implementation of the recommendations set out in this report. It should be a matter for the governance group to determine the priority and timing of implementation, and for the CSO to prepare and report progress against an appropriate implementation plan.


3. Overview of the GGD Reporting

Process

3.1 Introduction

In this Section we present an overview of the process for compilation and reporting of GGD figures.

3.2 Key Participants and Interactions

While a number of bodies and agencies provide data inputs to the GGD process, there are certain key participants and interactions as depicted in Figure 3.1.

Figure 3.1 – Key Participants and Interactions in the GGD Process

The roles of each of the parties identified in Figure 3.1 can be summarised as follows:-


Organisation Role

Central Bank Provides currency data to the CSO.

Recipient of ESA 95 quarterly debt return prepared by

CSO.

Central Statistics Office Under the terms of EU Regulation 1222/2004 and ESA 95

Accounting rules, the CSO independently compiles and

reports the stock of Quarterly General Government Debt

(as well as Quarterly Central and Local Government Debt)

to Eurostat, the Central Bank and European Central Bank,

using Table 28 as per the ESA 95 guidelines. The

quarterly debt return is submitted on a quarterly basis,

within 90 days of the end of each quarter as part of the

ESA 95.

Provides historical debt statistical figures as GGD

adjustments to the Department.

Department of the

Environment, Heritage and

Local Government

Provides quarterly Local Authority data, supporting return

data to the CSO.

Department of Finance

(Central Budget

Office/Statistics Unit)

To fulfil EDP reporting requirements to Eurostat, the

Statistics Unit within the Central Budget Office of the

Department is responsible for compiling estimates of the

level of GGD (also known as Maastricht Debt) outstanding

at the end of each of the previous four years.

Responsible and accountable for EDP reporting and

submits the final report to the Statistical Office of the

European Commission (Eurostat) twice-yearly, at the end

of March and September.

Provides the CSO with additional debt related information

relating to NCSSBs and Extra Budgetary Funds collected

via the ‘Debt & Deposits’ file which is circulated to all

Government Departments for completion (Troika reporting).

Provides GG Balance forecasts and, together with the

CSO, historical statistical reporting.

European Central Bank

(ECB)

Recipient of ESA 95 quarterly GGD return prepared by

CSO

Eurostat Enforce debt reporting requirements as defined by EU

Regulations.

Recipients and key reviewers of ESA 95 quarterly GGD

return prepared by CSO and EDP GGD return prepared by

the Department.

Government Departments Supplies the Department with debt and deposit data

relating to NCSSBs data and Extra Budgetary/Exchequer

Funds within their remit. Information is collated via routine

surveys conducted by the Department, which issues the

‘Debt and Deposits’ file to the Government bodies for

population.

Housing Finance Agency Provides quarterly Government Financial Accounts and

supporting data to the CSO.

Miscellaneous Bodies (Irish

Rail, HSE, Voluntary

Hospitals, HRI, NORA,

TG4)

Supply the CSO with data (annual report, or other formats)

for ESA quarterly debt reporting purposes.


Organisation Role

National Treasury

Management Agency

(NTMA)

Provides a breakdown of National Debt, an estimate of

National Debt interest on an ESA 95 basis, data relating to

the changes in Exchequer balances and funding (e.g. Post

Office Savings Bank Fund (POSBF) debt and other

supplementary data)

Fulfils ad hoc data requests relating to specific lending data

as requested by the Department for the Central Treasury

Loan programme operated by the POSBF.

3.3 Key Observations

A number of observations can be made at this point:-

Calculation of GGD is a complex activity governed by a set of policies and statistical standards, EU regulations and ESA methods.

Regular clarification is required as to the public bodies and items that should be included in the various elements of GGD reporting.

By its nature there are multiple parties involved in the calculation and/or provision of input data.

As this is statistical reporting there are estimations involved, and hence regular revisions to adjust for updated information specifically bi-annual / quarterly revisions to numbers, retrospectively for four years. This is common across all countries.

Given the significance of General Government Debt (and deficit) calculations and reporting, greater awareness amongst all Government departments, agencies and local authorities is required and this should form part of future budgetary/expenditure reform processes.


4. Review Framework

4.1 Overview

In order to gain an understanding of the process for the compilation and reporting of General Government Debt, and to identify opportunities for improvement, we conducted individual process “walk throughs” and reviews with the Department, the CSO and the NTMA. During the course of these sessions we reviewed source data and other inputs used, internal processes within each organisation, the outputs produced and their interactions with other bodies and agencies. In each case we documented our understanding of the process and validated it with each organisation. As part of our work we compared the key processes against a series of “good practices” that one would typically expect to be in place for the capture, processing and reporting of critical data. These are as follows:-

Principle Good Practice Section

Reference

Effective

Organisational

Arrangements

Clearly defined roles and responsibilities

Clearly defined governance process

Management review

Quality assurance/compliance review process

Verification and audit

Audit Committee Oversight

Section 5

Efficient

Processes &

Systems

Clearly defined and documented end to end process

Written procedures available to all parties and

updated as required

Automated systems for data capture, storage and

reporting

Reconciliation and confirmation procedures for inter-

agency transactions

Risk assessment and control

Section 6

Clarity of

Communications

Communications protocol

Inter-agency cooperation and service level

agreements

Escalation procedures for key issues

Section 7

Appropriate

Resourcing

Appropriate resource levels

Appropriately skilled and experienced resources

Training and technical updates at appropriate

intervals

Section 8


Principle Good Practice Section

Reference

Data Integrity Comprehensive data collection templates with

supporting notes

Central data repository

Section 9

It is noted that while areas for improvement in relation to the good practices have been identified, Eurostat reviews have not identified issues of non-compliance with Eurostat and ESA requirements. There is good cooperation between all parties involved and a clear desire to continue to enhance the processes, procedures and organisational arrangements to best effect. It is also noted that in some cases the agencies have begun to address some of the recommendations set out in this report.

4.2 Risk Management, and Internal Audit and Control

As part of our work, we sought to understand the extent to which the calculation and reporting of GGD had been considered within the context of the Department’s and the CSO’s risk management, and internal audit and control procedures. Specifically we considered this in the context of two sets of requirements/guidance:-

Report of the Working Group on the Accountability of Secretaries General and Accounting Officers (Mullarkey Report; July 2002); and

Risk Management Guidance for Government Departments and Offices (issued by the Department of Finance, March 2004).

The results of our enquiries are set out in the relevant sections below.

4.3 EU and Eurostat Regulations

GGD reporting is covered by EU Regulations and Eurostat policy and guidance. As part of our work we reviewed key EU Regulations, however our terms of reference did not extend to examining detailed Eurostat policy and guidance. Regulation (EC) No 2103/2005 which deals with the quality of statistical data in the context of the excessive deficit procedure states that:- 1. Member States shall provide the Commission (Eurostat) with a detailed inventory of the

methods, procedures and sources used to compile actual deficit and debt data and the underlying government accounts.

2. The inventories shall be prepared in accordance with guidelines adopted by the Commission (Eurostat) after consultation of CMFB.

3. The inventories shall be updated following revisions in the methods, procedures and sources adopted by Member States to compile their statistical data.

4. Member States shall make their inventories public. 5. The issues referred to in paragraphs 1, 2 and 3 may be addressed in the visits

mentioned in Article 8d. This is important in the context of the statistical discrepancy and on-going GGD reporting. In the context of the current Euro zone crises we understand that Eurostat will likely increase its examination of member state deficit and debt data.


5. Organisation

5.1 Introduction

In Section 3 we presented an overview of the process for compilation and reporting of GGD figures, together with the various participants in the process. In this Section we comment in more detail on the organisational aspects and specifically roles, responsibilities and interactions between the agencies. In reviewing organisational arrangements we considered the following good practice principles.

Principle Good Practice

Effective

Organisational

Arrangements


Clearly defined governance process

Management review

Quality assurance/compliance review process

Verification and audit

Audit Committee oversight

5.2 Good Practice Principle – Clearly defined roles and responsibilities

Observation and Comment

Under EU Regulations it is the responsibility of each Member State to designate the body responsible for the collation and reporting of statistical data to Eurostat. In the majority of cases this is the national statistical institute (i.e. the CSO in Ireland). There are a small number of exceptions to this. As prescribed by EU Regulations (specifically Regulation (EC) No 223/2009) and national legislation (the Statistics Act 1993), the CSO is responsible for all matters pertaining to statistical methodology and statistical standards used. The CSO is the “National Arbiter” of ESA rules and in most European Countries it is the national statistical institute (or central bank) that produces financial accounts under the ESA requirements. In relation to the collation and reporting of GGD, and specifically for EDP purposes, a joint responsibility has evolved over time between the CSO and the Department. This originated when EDP reporting was being introduced in 1994, as the CSO could not produce data on its own in the timeframe required. It is the Department that submits the EDP returns to Eurostat and the ECB.

As such there appeared to be dual ownership in the compilation, calculation and reporting of GGD with the Department and CSO independently computing and reporting the level of GGD, albeit for two different purposes (i.e. ESA and EDP returns). There is clear


duplication of effort, added complexity in the flows of data between various parties and increased risk of mis-communication, as illustrated below.

Compilation of

Inputs

The two parties collaborate in sourcing and sharing the key GGD

data inputs.

Computation &

Reporting

The Department and CSO currently undertake a similar process,

with two exceptions relating to the age profile of GGD data reported

and the timing of same.

For EDP purposes, the Department report estimates of the level of

GGD (Maastricht Debt) outstanding at the end of each of the

previous four years, on a twice yearly basis (March and October)

and are principally interested in annual data. The CSO produces full

time series data dating back to Q1 2000 and reports to Eurostat via

the ESA return on a quarterly basis. Note, the CSO also report

Central and Local Government quarterly debt data as part of the

ESA return.

Reconciliation

Before the EDP submission, both parties jointly review, on a line by

line basis, and reconcile the two computed GGD balances in order

to finalise the GGD figure for submission for EDP and ESA

purposes.

In our view, the dual role of the Department and the CSO in the compilation and reporting of GGD is unusual, although it is noted that it reflects developments over-time to meet GGD reporting requirements. Nevertheless it does not comply with good practice in terms of clear lines of accountability and responsibility. It should be noted that, arising from its ”Dialogue Visit” of November 2010, Eurostat requested that an alternative approach be considered i.e. primary responsibility for EDP returns be assigned to the CSO. The Department has a clear role in supporting Government in the management of the economy and national finances, and associated budgetary and debt policy. As such it is important that it has an appropriate expert understanding of ESA rules so as to provide input into policy decisions that would impact the level of reported debt, reviews and signs off of GGD returns. It is noted that the interpretation of ESA rules is a statistical function for which the CSO is responsible.

Recommendation 5A – Centralised Responsibility

Overall responsibility for the GGD compilation and reporting processes should be centralised in one organisation. This would reduce or eliminate duplication of effort, improve standardisation and communications, and ensure clear accountability. In our opinion the most appropriate agency for this is the CSO. However, it is noted that there will be some elapsed time before the CSO is in a position to take on this work. The respective interests and roles of other parties should be recognised through appropriate responsibility, accountability and governance structures (see below). In particular, the critical interest and role of the Department in current year and forecast GGD data should be recognised and accommodated appropriately. Specifically responsibility for GGD forecasts should remain with the Department, while bearing in mind that the CSO should maintain its present data quality control function in relation to complying with the relevant provisions of the ESA.



Although there appeared to be a reasonable degree of understanding of the roles played by each stakeholder in the GGD process, there is an opportunity to better clarify and formalise the roles and responsibilities of all parties involved. The parallel processes operated by the Department and CSO, the various flows of data, and the lack of formally documented process and procedures, make it difficult to define exactly where responsibility and accountability lies. It was noted that suppliers of data were not aware in this case of how data would be used by another party e.g. the NTMA indicated that it did not know that the BoP report was being used for GGD compilation purposes, as it provided another report for this purpose.

A RACI model (Responsible, Accountable, Consulted, Informed) would be of considerable benefit in the calculation and reporting of GGD. A RACI model is a tool used by organisations as a way to clearly define, document and communicate the roles and responsibilities of all stakeholders involved in a particular process. Serving as a responsibility assignment matrix, the RACI model is designed to assign tasks, activities, responsibilities, accountability, decision making and support to all process stakeholders and to clarify expectations on the level of their participation.

An illustrative example of a high level RACI matrix for the ‘EDP GGD reporting’ process is included in Appendix B.

Recommendation 5B – Formal Accountability Model

We recommend the development of a formal RACI (Responsibility, Accountability, Consulted, Informed) structure for all roles. The model should provide for clear cascade of responsibility from senior management, and for appropriate levels of validation and sign-off.

5.3 Good Practice Principle – Clearly defined governance process


The specific issue of the statistical discrepancy, and the subsequent internal and external reviews have highlighted weaknesses at a governance level. While there were regular communications and engagement between the parties, there was limited structure and formality to such communications. The Internal Report recommended the establishment of a General Government Group to improve co-operation between key parties, specifically the Department, the Department of Public Expenditure and Reform, the CSO, the NTMA and the Central Bank. We understand that there is also an existing Government Finance Statistics Liaison Committee, which comprises representatives of the CSO, the Department and the Central Bank. This Committee was set up in 2009, and has met on six occasions since its inception. Utilising existing structures may be a practical approach to improving governance. The more important consideration, however, is that whatever structure is put in place should have a clear mandate and work programme, it should meet regularly and should have representation from key stakeholder departments and agencies. Representation on the group should include the organisations referenced above and others where appropriate e.g. as the local government sector is a significant contributor to GGD it should perhaps be represented.


Recommendation 5C – Formal Coordination There is a need for greater and more formal coordination between the key parties involved in the calculation and reporting of GGD, and a governance group should be put in place to give effect to this. The group should include senior representatives of Department, the Department of Public Expenditure and Reform, the CSO, the NTMA, the Central Bank and other stakeholders where appropriate.

The mandate and meeting frequency of this group may evolve over time, but we would propose that initially it meets on a regular (e.g. monthly) basis. There is a considerable body of work to implement the recommendations arising from the Internal and External Reviews and in our opinion this Group should oversee this work from a governance perspective. Other recommended functions of the group should include:-

Review of changes to ESA and EDP rules and guidelines and associated implications for Ireland’s statistical reporting

Communication of policy decisions to all impacted stakeholders

Review and resolution of issues and risks associated with the GGD reporting process

Review and agreement of changes to processes and procedures

Quarterly reviews of GGD statistics and monitoring of relevant controls

5.4 Good Practice Principle – Management review


A small core group of staff within the CSO and the Department are responsible for the preparation and review of GGD reports. The management and external reporting of debt and deficit data will be key features of the Department’s work for the foreseeable future, and changes as a result of the Fiscal Compact Treaty, revised ESA rules, etc. will have a significant impact on reported data. The Internal Review reported that the Review Team was not aware of anyone within the Department being assigned the task of supervisory checks of the GGD calculation.

Recommendation 5D – Independent Management Review

Provision should be made, where it does not already exist, for independent line management review within and across the CSO and the Department of all ESA/EDP returns. The Department should also evaluate the need for the appointment of a senior resource to oversee, quality assure and standardise all elements of external debt and deficit reporting that fall within its remit.

5.5 Good Practice Principle – Quality assurance / compliance review process

Observation and Comment While the CSO does exercise a quality assurance function in relation to the statistical methodologies and standards used, and compliance with ESA standards, there was no overall quality assurance process in operation at the Department across all elements of the GGD process.


Such a review process would be expected to consider the effectiveness of processes and systems in use, the quality of the procedural documentation and the extent to which it is kept up to date, the process for communication of relevant updates, and the issue and risk management process.

Recommendation 5E – Quality Assurance Process

Management within the CSO and the Department should put in place a requirement for periodic quality assurance reviews by staff external to the GGD process. These may be staff from other sections, who while not necessarily expert in the subject matter, would have the competence to review the processes, procedures and general organisational arrangements.

5.6 Good Practice Principle – Verification and audit

Observation and Comment There is no requirement for verification or audit of the GGD returns, although Eurostat may undertake “Dialogue” and/or “Methodological” visits. Ireland has had a number of Dialogue visits, most recently in 2010. Methodological visits are only undertaken “in cases where substantial risks or potential problems with the quality of the data are identified”. Ireland has not had any methodological visits. Our investigations have indicated that the process for calculation and reporting of GGD has not fallen within the remit or scope of work of the internal audit functions in either the Department or CSO. Within the Department, the focus of the Internal Audit Unit has been on items within the Appropriation Account, EU Structural Funding, the Financial Management System and salaries. Within the CSO the focus was on a range of other areas but not National Accounts. In line with the 2004 Department of Finance Risk Management Guidance for Government Departments and Offices, internal audit functions have an important role in advising Accounting Officers on risk management processes. In doing so the full remit of activities of their functions should be considered not just those pertaining to income and expenditure by the department or office.

Recommendation 5F – Internal Audit Review It is recommended that GGD reporting process is included in the scope of the internal audit function in both the Department and the CSO. The focus should be on the effectiveness of the processes and procedures, as opposed to necessarily audit of the reported figures.

5.7 Good Practice Principle – Audit Committee oversight

Observation and Comment In line with the focus of the internal audit functions, neither Audit Committee in the Department or CSO considered GGD reporting. As above, the Risk Management Guidance for Government Departments and Offices indicates that Audit Committees should be responsible for reviewing and agreeing the processes for managing risk in department and offices. In doing so the full remit of activities


should be considered not just those pertaining to income and expenditure by the department or office.

Recommendation 5G – Audit Committee Oversight It is recommended that the GGD reporting process is given consideration from a risk management perspective by the Audit Committee in both the Department and CSO.


6. Process and Systems

6.1 Introduction

In this Section we comment on our findings and make recommendations in relation to Processes and Systems. In doing so we considered the following good practice principles:-


Efficient

Processes &

Systems

Clearly defined and documented end to end process

Written procedures available to all parties and updated as

required

Automated systems for data capture, storage and reporting

Reconciliation and confirmation procedures for inter-agency

transactions

Risk assessment and control

6.2 Good Practice Principle – Clearly defined and documented end to end process / Written procedures available to all parties and updated as required


While each organisation was aware of its own processes, and there are some levels of documentation available there is no clearly and consistently defined documentation which sets out inputs and outputs, activities and controls performed, points of interaction and handover, and the individuals responsible for all elements of the GGD compilation and reporting process. Likewise there are no procedures manuals in place which would define the tasks involved at each stage of the process.

The absence of documented processes impacts negatively on the ability of the Department and CSO to ensure that an efficient and effective process exists, with appropriate levels of control.

Recommendation 6A – Process Documentation

Clearly and consistently defined process documentation and procedures should be prepared for the end to end GGD process. These should be communicated to and made available to all parties, and updated at appropriate intervals.


6.3 Good Practice Principle - Automated systems for data capture, storage and reporting


There is a lack of automation in the data gathering and calculation process. Computations are input manually into MS Excel. Both the CSO and Department use separate computation files to derive their respective GGD figures. By its nature, the reliance on manual computation tools creates exposure to human error which may compromise data quality. This risk is compounded by the large range of data contained within files e.g. historic data dating back to 2000 for ESA quarterly debt reporting purposes. By automating the data collation elements of this process, the supplier of data could provide the ‘required’ GGD data inputs on a ‘right first time’ basis; directly into a centralised system which would be used to compute the GGD figure. Validation checks to flag anomalies/variances/imbalances for further investigation could be built into the system as quality assurance controls. As an alternative to a 100% line by line checking of the GGD files computed by the Department and CSO, an automated system would support the alignment of both computations and enable the identification of reconciliation differences for further investigation, in a timely manner. As a result this would reduce the significant degree of time spent on this reconciliation and balancing activity at each EDP quarter, and free resources to invest in other strategic, value added activities e.g. investigation of conflicting GGD balances etc. It is noted that the CSO is planning a significant IT Transformation Project in relation to National Accounts. Preliminary work in relation to process mapping and streamlining has already been undertaken.

Recommendation 6B – Standard GGD Model

The Department and the CSO should jointly explore the feasibility of developing a standard GGD calculation and reporting model (using a consolidation/reporting tool) to reduce the manual effort currently involved in this process. That model might serve both EDP and ESA debt reporting requirements and would enhance the reconciliation process. The proposed development of a standard data input template (see Recommendation 9A) could complement this model by automatically linking to same in achieving a streamlined GGD calculation process. This recommendation should be considered in the context of the timing of the CSO’s IT Transformation Project.

6.4 Good Practice Principle - Reconciliation and confirmation procedures for inter-agency transactions


Where State agencies are permitted to borrow or have other forms of liabilities to/from each other, a process of inter-agency reconciliation should be in place as part of the controls in the GGD process. It is our understanding that there is no such complete listing at present. It is likely that the statistical discrepancy could have been detected if a process of inter-agency reconciliation and cross checking had been in place. In a commercial corporate group this would be common-place and referred to as “intercompany reconciliations” and intercompany eliminations on consolidation”.


Recommendation 6C – Reconciliation of Data

A comprehensive listing of State agencies which are permitted to borrow or have (or are likely to have) other forms of liabilities between each other should be developed, and reconciliations of both the amounts and definitions of assets/liabilities between agencies should be incorporated as part of the GGD process. The Departments of Finance, and Public Expenditure and Reform, and the CSO should cooperate in developing and maintaining this list.

6.5 Good Practice Principle - Risk assessment and control


The Report of the Working Group on the Accountability of Secretaries General and Accounting Officers, 2002 (Mullarkey Report) recommended that risk assessment and management should be integrated into the management processes of Departments and offices. The Report recommended that the risk management system should concentrate on the principal risks to the organisation as well as the principal risks arising from its relationship with other organisations. It identified four categories of risk – strategic, operational, financial and reputational. Critical among these points in the context of GGD calculation and reporting are “principal risks arising from its relationship with other organisations” and “reputational” risks. Our investigations have indicated that the calculation and reporting of GGD has not featured on the risk registers of the Department or the CSO. This is not to suggest that there was an omission per se, but rather the likelihood that the calculation and reporting of GGD was considered a lower risk area.

Recommendation 6D – Risk Register Review In light of the statistical discrepancy, we recommend that management within the Department, the CSO, NTMA, the HFA and other key agencies review their risk registers to consider what, if any, updates are necessary in relation to the calculation and reporting of GGD.

Recommendation 6E – Department of Finance Risk Management Review As per our terms of reference, the scope of our work was limited to General Government Debt. However, this is just one element of a wide range of debt, deficit and other external reporting related to the national finances. As such, it is recommended that the Department of Finance conducts a formal risk assessment of all such areas to determine the likelihood and impact of potential misstatements. This determination would be based on factors such as the complexity of the process, the number of parties involved, and the reliability of underlying systems and data. Other Departments and offices should participate in this process as appropriate.


7. Communication

7.1 Introduction

In this Section we comment on our findings and make recommendations in relation to Communications. In doing so we considered the following good practice principles.


Clarity of

Communications

Communications protocol

Inter-agency cooperation and service level agreements

Escalation procedures for key issues

7.2 Good Practice Principle - Communications protocol


There are some formal elements to the existing processes e.g. at each EDP quarter, the Department and CSO meet to perform the reconciliation and balancing activity before transmission of the ESA Quarterly debt file and the EDP return to Eurostat. However, there is also a high degree of engagement between the Department and the CSO with frequent communication and information exchanges. We noted a significant informal element to this with verbal discussions and email prevailing as the primary vehicles of communication. Communications with other stakeholders often followed a similar pattern. While there is a clear benefit to informal communications in fostering a good working relationship, and discussing matters in a timely manner, there is also a need for more formal communications processes particularly in relation to, for example, matters of policy, interpretation of ESA guidelines or issue escalation. At a senior level, relationships between the parties are good, and officials are available and supportive.

Recommendation 7A – Communications Policy

The recommendations set out in Section 5, in relation to organisation arrangements, roles and responsibilities, and governance should greatly improve the quality and effectiveness of communications between parties. In addition, a formal communications policy should be developed to address matters such as frequency of review meetings, issue escalation and circulation of materials.


7.3 Good Practice Principle - Inter-agency cooperation and service level agreements


There are no inter-agency cooperation or service level agreements in place. GGD reporting to Eurostat is standardised, regular reporting which is required on a permanent basis. In such cases it would be common to expect a formalised arrangement to be in place between key parties that would define, for example, the data to be provided, format for transmission, timelines and quality standards expected. Such agreements should be appropriate in scope and detail to the requirement. The existing good working relationships would be enhanced by the additional structure that these agreements would bring.

Recommendation 7B – Statement of Requirements

It is recommended that the CSO, in the context of the role envisaged for it in recommendations 5A, coordinates the preparation of a concise statement of requirements/service agreement between the key parties in the GGD process that define the service arrangements including the data to be provided, format for transmission, timelines, accountabilities and quality standards expected.

7.4 Good Practice Principle - Escalation procedures for key issues


The Internal Review Report indicates that there were indicators of an issue during 2010 and 2011, including specific e-mails raising queries that should have prompted greater action. This indicates that there was a lack of a formal mechanism to raise and resolve issues.

In addition, Section 2.5.9 of the Internal Review Report explains the historical context to the statistical discrepancy dating back to when the HFA was first reclassified into the General Government Sector in March 2007, and the reclassification errors relating to this that occurred.

Recommendation 7C – Issue Management Process

A formal issue management process should be put in place as part of the governance structures supporting GGD calculation and reporting. This should include the classification of issues which would allow items of significant risk or uncertainty to be escalated quickly.

The issue management process should include a formal assessment and sign-off by relevant parties, where issues identified give rise to policy changes requiring restatement or different treatment of data.


8. Resourcing

8.1 Introduction

In this Section we comment on our findings and make recommendations in relation to resourcing. In doing so we considered the following good practice principles.


Appropriate

Resourcing

Appropriate resource levels

Appropriately skilled and experienced resources

Training and technical updates at appropriate intervals

8.2 Good Practice Principle - Appropriate resource levels


It is noted that the Statistics Unit within the Department operated for a period with reduced resources, much of this at a time when the workload was increasing due, for example, to additional reporting to the IMF/EU/ECB Troika.

Recommendation 8A – Resource Review

The adequacy of the resources in the Statistics Unit should be reviewed on a regular basis by Management within the Department, to ensure that staffing is at a level commensurate with the workload of the Unit and the relative risk profile of its work.

8.3 Good Practice Principle - Appropriately skilled and experienced resources


The availability within the Statistics Unit of the necessary expertise in relation to significant elements of the Unit’s work was limited, although recourse was available to other resources within the Department, to the CSO and other agencies as required.


Recommendation 8B – Skills Need Analysis

The capability of the resources within the Statistics Unit should be reviewed by management, against a defined competency model. Subject to any changes in organisational arrangements (see Section 5), the seconding of a resource from the CSO should continue as it should leverage available expertise and facilitates cooperation. However, the Department should continue to supplement this resource with adequately experienced and trained resources to ensure that it can deliver on its responsibilities. Appointments to the Unit should only be on the basis of candidates having the necessary mix of statistical, accounting, economic and policy competency.

8.4 Good Practice Principle - Training and technical updates at appropriate intervals

Observation and Comment GGD reporting is a technical and complex area, and yet there is limited cross agency training and technical updates available. It is also an area that may have further policy change e.g. through the Fiscal Compact Treaty.

Recommendation 8C - Training A training / technical update programme should be put in place for staff, management and internal audit on at least an annual basis.


9. Data Management

9.1 Introduction

In this Section we comment on our findings and make recommendations in relation to data management. In doing so we considered the following good practice principles.


Data Integrity Comprehensive data collection templates with supporting notes

Central data repository

9.2 Good Practice Principle - Comprehensive data collection templates with supporting notes


There is an absence of a standardised template for GGD data collection with multiple sources submitting various forms of data, varying in detail and format e.g. Annual reports in protected PDFs, data contained within the body of emails, etc. Data provided, in some cases, also exceeds the necessary GGD input requirement. This is both an ineffective and inefficient means of collecting data. It is manually intensive and error prone. General experience in such circumstances suggests that too much time in spent collecting and entering data, rather than reviewing it for accuracy and consistency. During the course of our review, there was general consensus that the data collection templates currently in use are in need of enhancement. It is worth noting that Public Financial Procedures (Section C6 4) states that in general, it is the responsibility of the user Department to define requirements clearly.

Recommendation 9A – Standard Template

Develop a standardised template (or set of templates) for all counterparty data, with a separate, tailored section to address source-specific reporting requirements for ESA and EDP reporting purposes. The objective should be to establish a more streamlined information exchange process, removing the amount of rework and manual data entry while improving the overall efficiency and accuracy of data collation.


Each supplying agency should complete one agreed data collection template which meets the needs of both the Department and the CSO, for historical, current and forecast data as appropriate. Recommendation 7B should also be considered in this context. GGD information suppliers should have explained to them the specific data requirements and the impact on the overall GGD calculation process.

Clear, simple language should be used with guidance on requirements. Technical terms should be clearly explained.

9.3 Good Practice Principle - Central data repository


As referenced above, data is transmitted and received in many formats, and shared between several parties. Spread-sheets are currently the most common tool in use. In such a data intensive environment, data and document management is critical to ensure efficiency and data integrity.

Recommendation 9B – Data Management

Enhanced document management techniques and technologies should be adapted including cost effective approaches such as eRooms and secure shared drives.


10. Statement of Responsibility

We take responsibility for this report, which is prepared on the basis of the limitations set out below. Our work is carried out under an Engagement Letter dated 18th January 2012. The scope and objective of this review is summarised in Section 1 - Background and Approach, of this Report. Our work consisted of a review of processes and did not include any audit or verification work on statistical reports previously produced. The matters raised in this report are only those which came to our attention during our review and are not necessarily a comprehensive statement of all weaknesses that exist, or all actions that might be taken. This report is addressed to the Department of Finance. We do not accept or assume responsibility to anyone other than the Department of Finance. We do however understand that a copy of our report will be sent to the Committee of Public Accounts. If it is proposed to make this report available to any other party we would expect you to inform us in advance. Any party who obtains access to our report or a copy and chooses to rely on our report (or any part of it) will do so at its own risk.

Deloitte & Touche Deloitte & Touche House Earlsfort Terrace Dublin 2 Date 8th May 2012


Appendix A – Abbreviations

Abbreviation Description

BoP Balance of Payments

CB The Central Bank of Ireland

CMFB Committee on Monetary, Financial and Balance of Payments Statistics

CSO Central Statistics Office

DEHLG The Department of Environment, Heritage and Local Government

Deloitte Deloitte & Touche

The Department The Department of Finance

ECB European Central Bank

EDP Excessive Deficit Procedure

ESA European System of Accounts

EU European Union

Eurostat Statistical Office of the European Union

GGD General Government Debt

HFA Housing Finance Agency

HRI Horse Racing Ireland

HSE Health Service Executive

NCSSB Non Commercial State Sponsored Body

NORA National Oil Reserve Agency

NTMA National Treasury Management Agency

POSBF Post Office Savings Bank Fund

RACI Responsible, Accountable, Consulted, Informed


Appendix B – RACI Models

This Appendix contains further details of the RACI (Responsible, Accountable, Consulted, Informed) Models discussed in Section 5. A RACI model is a tool used by organisations as a way to clearly define, document and communicate the roles and responsibilities of all stakeholders involved in a particular process. Serving as a responsibility assignment matrix, the RACI model is designed to assign tasks, activities, responsibilities, accountability, decision making and support to all process stakeholders and to clarify expectations on the level of their participation. An illustrative example of a high level RACI matrix for the ‘EDP GGD reporting’ process undertaken by the Statistics Unit of the Department is illustrated below -

The high level matrix outlines the key top-level activities in the EDP GGD reporting process, and the associated roles for each of the key stakeholders. By adopting the RACI matrix development approach above, the related stakeholders could collaborate in designing an appropriate model which would clearly articulate the key activities at a top and sub process level, for each component of the GGD compilation process.

RACI model charting delivers multiple benefits to an organisation including;


Increased productivity through well-defined accountability

Increased capacity by eliminating overlaps and redundancies

Less confusion/misunderstandings by encouraging teamwork

Reduced duplication of effort

GGDebt compilation and reporting

Ro

le #

1

Ro

le #

2

Ro

le #

3

Ro

le #

1

Ro

le #

2

Ro

le #

3

Ro

le #

1

Ro

le #

2

Ro

le #

3

Ro

le #

1

Ro

le #

2

Ro

le #

3

Ro

le #

1

Ro

le #

2

Ro

le #

3

Ro

le #

1

Ro

le #

2

Ro

le #

3

Compilation and Reporting of General

Government Debt to Eurostat twice

yearly (EDP Reporting)

Data collation

Data input

GG Debt calculation

GG Debt consolidation,validation and

reconciliation

GG Debt balancing with the CSO

Final submission to Eurostat I

Other 'General

Government'

bodies

CC

I

Government

Depts

CC

R, A R

R, A I I I

R, A

R, A

R, A R C

R, A C

NTMA Eurostat

RACI Matrix Template

DoF - SU CSO

R, A C, I C C

Role

Activity

SAMPLE


Streamlined work process by eliminating unnecessary interfaces and assigning ‘accountability’ where it belongs

Improved organisational effectiveness by allowing disciplines to cooperate and share responsibility

The RACI Model Components

The RACI Matrix Approach

A RACI matric supports the model and is used to discuss, agree and communicate roles and responsibilities.

The individual/(s) who does the work to achieve the task or activity and is/are responsible for action and/or roll-out.

Responsibility is often shared, with each individual’s degree of responsibility

determined by the individual with the “A”.

‘Accountable’ is the person or role who has the final authority and accountability to a given task. For any given task, there is only one role/person accountable. This

accountability can’t be delegated to other roles or individuals or entities.

.

Responsible Accountable

‘Consulted’ are the people/roles who are consulted and taken advice from before

and during performing the task. These are the individuals who must be consulted

prior to a final decision or action. “Consult” implies two-way communication.

‘Informed’ are the people/roles who need to be informed after a decision or action is

taken because they, in turn, may take action or make a decision based on the output. “Inform” is FYI and implies only

one-way communication.

Consulted Informed


Appendix C – List of

Recommendations

Principle Recommendations

Effective

Organisational

Arrangements

(Reference

Section 5)

Recommendation 5A – Centralised Responsibility

Overall responsibility for the GGD compilation and reporting processes should

be centralised in one organisation. This would reduce or eliminate duplication of

effort, improve standardisation and communications, and ensure clear

accountability. In our opinion the most appropriate agency for this is the CSO.

However, it is noted that there will be some elapsed time before the CSO is in a

position to take on this work.

The respective interests and roles of other parties should be recognised through

appropriate responsibility, accountability and governance structures (see below).

In particular, the critical interest and role of the Department in current year and

forecast GGD data should be recognised and accommodated appropriately.

Specifically responsibility for GGD forecasts should remain with the Department,

while bearing in mind that the CSO should maintain its present data quality

control function in relation to complying with the relevant provisions of the ESA.

Recommendation 5B – Formal Accountability Model

We recommend the development of a formal RACI (Responsibility,

Accountability, Consulted, Informed) structure for all roles. The model should

provide for clear cascade of responsibility from senior management, and for

appropriate levels of validation and sign-off.

Recommendation 5C – Formal Coordination

There is a need for greater and more formal coordination between the key

parties involved in the calculation and reporting of GGD, and a governance

group should be put in place to give effect to this. The group should include

senior representatives of Department, the Department of Public Expenditure and

Reform, the CSO, the NTMA, the Central Bank and other stakeholders where

appropriate.

The mandate and meeting frequency of this group may evolve over time, but we

would propose that initially it meets on a regular (e.g. monthly) basis. There is a

considerable body of work to implement the recommendations arising from the

Internal and External Reviews and in our opinion this Group should oversee this

work from a governance perspective.

Other recommended functions of the group should include:-



Review of changes to ESA and EDP rules and guidelines and associated

implications for Ireland’s statistical reporting

Communication of policy decisions to all impacted stakeholders

Review and resolution of issues and risks associated with the GGD reporting

process

Review and agreement of changes to processes and procedures

Quarterly reviews of GGD statistics and monitoring of relevant controls

Recommendation 5D – Independent Management Review

Provision should be made, where it does not already exist, for independent line

management review within and across the CSO and the Department of all

ESA/EDP returns. The Department should also evaluate the need for the

appointment of a senior resource to oversee, quality assure and standardise all

elements of external debt and deficit reporting that fall within its remit.

Recommendation 5E – Quality Assurance Process

Management within the CSO and the Department should put in place a

requirement for periodic quality assurance reviews by staff external to the GGD

process. These may be staff from other sections, who while not necessarily

expert in the subject matter, would have the competence to review the

processes, procedures and general organisational arrangements.

Recommendation 5F – Internal Audit Review

It is recommended that GGD reporting process is included in the scope of the

internal audit function in both the Department and the CSO. The focus should be

on the effectiveness of the processes and procedures, as opposed to

necessarily audit of the reported figures.

Recommendation 5G – Audit Committee Oversight

It is recommended that the GGD reporting process is given consideration from a

risk management perspective by the Audit Committee in both the Department

and CSO.



Efficient

Processes &

Systems

(Reference

Section 6)

Recommendation 6A – Process Documentation

Clearly and consistently defined process documentation and procedures should

be prepared for the end to end GGD process. These should be communicated

to and made available to all parties, and updated at appropriate intervals.

Recommendation 6B – Standard GGD Model

The Department and the CSO should jointly explore the feasibility of developing

a standard GGD calculation and reporting model (using a consolidation/reporting

tool) to reduce the manual effort currently involved in this process. That model

might serve both EDP and ESA debt reporting requirements and would enhance

the reconciliation process. The proposed development of a standard data input

template (see Recommendation 9A) could complement this model by

automatically linking to same in achieving a streamlined GGD calculation

process. This recommendation should be considered in the context of the timing

of the CSO’s IT Transformation Project.

Recommendation 6C – Reconciliation of Data

A comprehensive listing of State agencies which are permitted to borrow or have

(or are likely to have) other forms of liabilities between each other should be

developed, and reconciliations of both the amounts and definitions of

assets/liabilities between agencies should be incorporated as part of the GGD

process. The Departments of Finance, and Public Expenditure and Reform, and

the CSO should cooperate in developing and maintaining this list.

Recommendation 6D – Risk Register Review

In light of the statistical discrepancy, we recommend that management within the

Department, the CSO, NTMA, the HFA and other key agencies review their risk

registers to consider what, if any, updates are necessary in relation to the

calculation and reporting of GGD.

Recommendation 6E – Department of Finance Risk Management Review

As per our terms of reference, the scope of our work was limited to General

Government Debt. However, this is just one element of a wide range of debt,

deficit and other external reporting related to the national finances. As such, it

is recommended that the Department of Finance conducts a formal risk

assessment of all such areas to determine the likelihood and impact of potential

misstatements. This determination would be based on factors such as the

complexity of the process, the number of parties involved, and the reliability of

underlying systems and data. Other Departments and offices should participate

in this process as appropriate.



Clarity of

Communications

(Reference

Section 7)

Recommendation 7A – Communications Policy

The recommendations set out in Section 5, in relation to organisation

arrangements, roles and responsibilities, and governance should greatly improve

the quality and effectiveness of communications between parties. In addition, a

formal communications policy should be developed to address matters such as

frequency of review meetings, issue escalation and circulation of materials.

Recommendation 7B – Statement of Requirements

It is recommended that the CSO, in the context of the role envisaged for it in

recommendations 5A, coordinates the preparation of a concise statement of

requirements/service agreement between the key parties in the GGD process

that define the service arrangements including the data to be provided, format

for transmission, timelines, accountabilities and quality standards expected.

Recommendation 7C – Issue Management Process

A formal issue management process should be put in place as part of the

governance structures supporting GGD calculation and reporting. This should

include the classification of issues which would allow items of significant risk or

uncertainty to be escalated quickly.

The issue management process should include a formal assessment and sign-

off by relevant parties, where issues identified give rise to policy changes

requiring restatement or different treatment of data.

Appropriate

Resourcing

(Reference

Section 8)

Recommendation 8A – Resource Review

The adequacy of the resources in the Statistics Unit should be reviewed on a

regular basis by Management within the Department, to ensure that staffing is at

a level commensurate with the workload of the Unit and the relative risk profile of

its work.

Recommendation 8B – Skills Need Analysis

The capability of the resources within the Statistics Unit should be reviewed by

management, against a defined competency model. Subject to any changes in

organisational arrangements (see Section 5), the seconding of a resource from

the CSO should continue as it should leverage available expertise and facilitates

cooperation. However, the Department should continue to supplement this

resource with adequately experienced and trained resources to ensure that it

can deliver on its responsibilities. Appointments to the Unit should only be on

the basis of candidates having the necessary mix of statistical, accounting,

economic and policy competency.

Recommendation 8C - Training

A training / technical update programme should be put in place for staff,

management and internal audit on at least an annual basis.



Data Integrity

(Reference

Section 9)

Recommendation 9A – Standard Template

Develop a standardised template (or set of templates) for all counterparty data,

with a separate, tailored section to address source-specific reporting

requirements for ESA and EDP reporting purposes. The objective should be to

establish a more streamlined information exchange process, removing the

amount of rework and manual data entry while improving the overall efficiency

and accuracy of data collation.

Each supplying agency should complete one agreed data collection template

which meets the needs of both the Department and the CSO, for historical,

current and forecast data as appropriate. Recommendation 7B should also be

considered in this context.

GGD information suppliers should have explained to them the specific data

requirements and the impact on the overall GGD calculation process.

Clear, simple language should be used with guidance on requirements.

Technical terms should be clearly explained.

Recommendation 9B – Data Management

Enhanced document management techniques and technologies should be

adapted including cost effective approaches such as eRooms and secure shared

drives.

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