Mr. Seamus McCarthy:

One of the recommendations was that there be a central unit somewhere in the system that determined what are the accounting frameworks to be used and why. At present, in the Department of Public Expenditure and Reform the rules for appropriation accounting are made. It is completely a matter for the Department of Finance how the finance accounts will be structured and presented. One has the Department of Education and Skills making determinations in relation to the third level bodies we were talking about this morning and education and training boards, and one has the Minister for Health making determinations in relation to how health bodies will do their financial reporting. Anybody who does not fit into such categories comes under FRS 102, which is accrual-based accounting. We have a lot of different things happening in an unco-ordinated fashion. That was a core view of the IMF, that there needs to be more coherence around it.

One point I would make is that we have talked this morning about a cash accounting basis or an accrual accounting basis. In fact, what we have is not a pure cash accounting basis. It is a modified cash accounting. If one looks at an appropriation account, one can see that there is a statement of assets and liabilities in it. That is an accrual based concept and the aim is to provide a certain amount of information on an accruals basis. It is not as simple as saying we will do it on a cash basis or we will do it on an accrual basis; there is an intermediate space. What one really needs is a central view on what is appropriate.