Framework Document between The Scottish Government and Crown Estate Scotland

5. External accountability

5.1 Annual Report and Accounts

Crown Estate Scotland financial and reporting year runs from 1 April until 31 March.

Crown Estate Scotland must have it’s Annual Report and Accounts prepared and submitted in draft to the Sponsor Team by 30 June each year. The Annual Report should cover the activities of any subsidiary or joint venture under the control of Crown Estate Scotland. The report must list any direction given to Crown Estate Scotland during that year, subject to the requirements of section 26(4) of the 2019 Act.

• The accounts will, so far as appropriate, comply with the SPFM and with any Accounts Direction or other relevant direction issued by the Scottish Ministers.
• Crown Estate Scotland are also expected to provide a realistic estimate of expected outturn position and Provisional Outturn Statement to Sponsor Team who will submit these to the Scottish Parliament.
• the final version of the report and accounts shall be laid before the Scottish Parliament later that year by the Scottish Ministers in keeping with the timetable as advised by the Sponsor Team. The accounts must not be published before they have been laid.
• Crown Estate Scotland have responsibility for their proper presentation as described in the relevant Accounts Direction issued by Scottish Ministers. Crown Estate Scotland shall be responsible, once laid in Parliament, for the publication of the report and accounts.
• Crown Estate Scotland will ensure that a copy of the Annual Report and Accounts are delivered to the Sponsor Team and to His Majesty.

5.2 External Audit

Whilst the statutory date under Section 22(5a) of the Public Finance and Accountability (Scotland) Act 2000 for laying and publishing accounts audited by the AGS is by 31 December, following the close of the previous financial year, there is an expectation on part of the Scottish Ministers that accounts will be laid in Parliament, and published at the earliest possible date following the completion of the formal sign-off and approval process.

Crown Estate Scotland's accounts will be audited by Audit Scotland or a firm of external auditors appointed by the AGS. The Sponsor Team shall submit the audited accounts to the Scottish Ministers, who shall lay them, together with the annual report, before the Parliament.

Crown Estate Scotland shall include copies of all external audit management letters (and correspondence relating to those letters) and responses in the audit committee papers which are shared with the Sponsor Team in the normal course of business.

5.3 Internal Audit

Crown Estate Scotland will:

• establish and maintain arrangements for internal audit in accordance with the Public Sector Internal Audit Standards and the Internal Audit section of the SPFM;
• set up an Audit Committee of its Board, in accordance with the Audit Committees section of the SPFM, to advise both the board and Chief Executive in his/her capacity as the Accountable Officer;
• ensure that the Sponsor Team and the Portfolio AO/Senior Sponsor receive promptly after they are produced or updated: the audit charter, strategy, periodic audit plans and annual audit assurance report, including the Head of Internal Audit opinion on risk management, control and governance – and provide any other relevant audit reports as requested by sponsors;
• keep records of, and prepare and forward promptly to the Scottish Government an annual report on fraud and theft suffered by Crown Estate Scotland and notify the Portfolio AO or Senior Sponsor immediately of any unusual or major incidents.
• The Scottish Government’s Internal Audit and Assurance Directorate has an expectation of cooperation and access to relevant material if required. Crown Estate Scotland will provide information as requested, in line with the statutory requirements of Section 40 of the 2019 Act, subject to data protection and GDPR requirements.

5.4 Value For Money / 3E Examinations

The AGS, under section 23 of the Public Finance and Accountability (Scotland) Act 2000, may initiate examinations into the economy, efficiency and effectiveness (3E examinations) under which certain bodies have used their resources in discharging their functions. 3E examinations are also commonly referred to as "section 23 examinations/reports", "value for money examinations/reports" and "performance audits/reports".

Crown Estate Scotland shall provide, in conditions to grants and contracts, for the AGS to exercise such access to documents held by grant recipients as may be required for these examinations; and shall use its best endeavours to secure access for the AGS to any other documents required by the AGS which are held by other bodies.