Transport for LondonIndependent Auditors' report to the Board of Transport for London
Skip to navigationOpinion on the financial statements
We have audited the financial statements of Transport for London ('the Corporation') and the Transport for London Group ('the Group') for the year ended 31 March 2006, which comprise the Explanatory Foreword, the Corporation and Group Revenue Accounts, Balance Sheets, Statements of Movements in Reserves, Cash Flow Statements and the related notes. These financial statements have been prepared in accordance with the accounting policies set out therein.
This report is made solely to Transport for London, as a body, in accordance with Part II of the Audit Commission Act 1998. Our audit work has been undertaken so that we might state to Transport for London, as a body, those matters we are required to state to it in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Transport for London, as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of the Chief Finance Officer and the Auditor
As described on Page 93 the Chief Finance Officer is responsible for the preparation of the financial statements in accordance with applicable laws and regulations and The Code of Practice on Local Authority Accounting in the United Kingdom 2005: A Statement of Recommended Practice.
Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements present fairly the financial position of the Corporation and the Group in accordance with applicable laws and regulations and the 2005 SORP.
We review whether the information given in the Statement of Corporate Governance Assurance on pages 94 to 98 is consistent with the financial statements and reflects compliance with CIPFA's Guidance 'The Statement on Internal Control in Local Government: Meeting the Requirements of the Accounts and Audit Regulations 2003'. We report if the Statement does not comply with proper practices specified by CIPFA or if the Statement is misleading or inconsistent with other information we are aware of from our audit of the financial statements. We are not required to consider whether the Statement covers all risks and controls, or to form an opinion on the effectiveness of the Corporation's corporate governance arrangements or its risk and control procedures. Our review was not performed for any purpose connected with any specific transaction and should not be relied upon for any such purpose.
We read other information published with the financial statements, and consider whether it is consistent with the audited financial statements. This other information comprises the Annual Report. We consider the implications for our report if we become aware of any apparentmisstatements or material inconsistencies with the financial statements. Our responsibilities do not extend to any other information.
Basis of audit opinion
We conducted our audit in accordance with the Audit Commission Act 1998, the Code of Audit Practice issued by the Audit Commission and International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the Corporation and the Group in the preparation of the financial statements, and of whether the accounting policies are appropriate to the Corporation and the Group's circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion, we evaluated the overall adequacy of the presentation of information in the financial statements.
Opinion
In our opinion the financial statements present fairly, in accordance with applicable laws and regulations and The Code of Practice on Local Authority Accounting in the United Kingdom 2005: A Statement of Recommended Practice, the financial position of the Corporation and the Group at 31 March 2006 and their income and expenditure for the year then ended.
KPMG LLP
Chartered Accountants
London
21 August 2006
Conclusion on arrangements for securing economy, efficiency and effectiveness in the use of resources
The Corporation's Responsibilities
The Corporation is responsible for putting in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources, to ensure proper stewardship and governance, and to regularly review the adequacy and effectiveness of these arrangements.
Under the Local Government Act 1999, the Corporation is required to prepare and publish a best value performance plan summarising the Corporation's assessment of its performance and position in relation to its statutory duty to make arrangements to ensure continuous improvement in the way in which its functions are exercised, having regard to a combination of economy, efficiency and effectiveness.
Auditor's Responsibilities
We are required by the Audit Commission Act 1998 to be satisfied that proper arrangements have been made by the Corporation for securing economy, efficiency and effectiveness in its use of resources. The Code of Audit Practice issued by the Audit Commission requires us to report to you our conclusion in relation to proper arrangements, having regard to relevant criteria specified by the Audit Commission for other local government bodies. We report if significant matters have come to our attention which prevent us from concluding that the Corporation has made such proper arrangements. We are not required to consider, nor have we considered, whether all aspects of the Corporation's arrangements for securing economy, efficiency and effectiveness in its use of resources are operating effectively.
We are required by section 7 of the Local Government Act 1999 to carry out an audit of the Corporation's best value performance plan and issue a report:
- Certifying that we have done so
- Stating whether we believe that the plan has been prepared and published in accordance with statutory requirements set out in section 6 of the Local Government Act 1999 and statutory guidance
- Where relevant, making any recommendations under section 7 of the Local Government Act 1999
Conclusion
We have undertaken our audit in accordance with the Code of Audit Practice and we are satisfied that, having regard to the criteria for other local government bodies specified by the Audit Commission, in all significant respects, the Corporation made proper arrangements to secure economy, efficiency and effectiveness in its use of resources for the year ended 31 March 2006.
Best Value Performance Plan
We issued our statutory report on the audit of the Corporation's Best Value Performance Plan for the financial year 2005/06 on 10 November 2005. We did not identify any matters to be reported to the Corporation and did not make any recommendations on procedures in relation to the plan.
Certificate
We certify that we have completed the audit of the accounts in accordance with the requirements of the Audit Commission Act 1998 and the Code of Audit Practice issued by the Audit Commission.
KPMG LLP
Chartered Accountants
London
21 August 2006
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