Dear Mr Paterson

This email is to acknowledge and respond to your freedom of information request dated 10 September.

Audit Scotland does not hold the information you have requested and therefore under section 17 of the Freedom of Information (Scotland) Act 2002 I must inform you that Audit Scotland does not hold the information requested.

This request is now closed.

However under the duty to assist an applicant I can inform you that the dates for the annual Audits during 2020 have been changed to allow for the impact of Covid-19. The Audit of the Scottish Government consolidated accounts is due to be completed by the 31 December 2020.

On completion of the audit we will be in a position to respond regarding the information you have requested.

I have spoken with the auditor and diarised a meeting, in January 2021, to provide a response to the information you are seeking. This will mean you do not need to resubmit your request and I will contact you in January 2021.

I hope this is helpful to you.

Yours sincerely

Ian Metcalfe
Corporate Performance Officer
Audit Scotland, 4th Floor, 102 West Port, Edinburgh EH3 9DN
T: 0131 625 1861
[mobile number]
E: [email address]
www.audit-scotland.gov.uk

During the current COVID-19 suppression measures I am working from home. For more information on Audit Scotland’s work during this situation, read the statement on our website. https://www.audit-scotland.gov.uk/

show quoted sections

Thank you for your email, however I am out of the office and will be back
from  9:30am on the 7 January 2021.

I will get back to you as soon as I can after that.

Dear Mr Paterson

Following my email in September 2020 I said I would update you once the
Scottish Government audit was complete. The 2019/20 audit of the
[1]Scottish Government Consolidated Accounts were published in December
2020 and I can confirm that the Scottish Government's 2019/20 annual audit
report will be available on our website soon.

I am now able to respond to your Freedom of information request in which
you asked for:

“In relation to Audit Scotland’s audit of the Scottish Government’s
Consolidated Accounts for the year ended 2019/20, for each of the
organisations listed below, please provide a copy of Audit Scotland’s
assessment of:

(1)(a) the gross valuation of the loan or equity investment (before taking
account of the risk of default and other factors) at the year-end 2019/20.

(1)(b) the extent of any unpaid interest and charges added to the
principal and therefore included in the response to (1)(a) at the year-end
2019/20.

(2) the net valuation of the loan or equity investment (after taking
account of the risk of default and other factors) at the year-end 2019/20.

Where there is both a loan and an investment in an organisation (e.g.
Burntisland Fabrications Limited) please provide a separate response to
questions 1 and 2 for the loan and for the investment.

Organisations:

o Burntisland Fabrications Limited
o Ferguson Marine Engineering Limited (in administration)
o Ferguson Marine Engineering (Holdings) Limited (in administration)
o Ferguson Marine (Port Glasgow) Limited and associated companies
o Glasgow Prestwick Airport Limited and associated companies
o Lochaber Aluminium Smelter
o Our Power Community Benefit Society Limited (in administration)

Please also provide a list of loans and investments in commercial
organisations not otherwise listed above where the gross loan or
investment is £10 million or above at the end of March 2020.  Please also
provide the net valuation of the loan or investment.”

Our audit work in relation to loans made by the Scottish Government was
carried out as part of our audit of the 2019/20 Scottish Government
consolidated accounts.  In preparing these accounts, the Scottish
Government was required to comply with the 2019/20 Government Financial
Reporting Manual (FReM).  Our annual audit opinion on the consolidated
accounts concludes that the accounts have been properly prepared in
accordance with International Financial Reporting Standards as interpreted
and adapted by the 2019/20 FReM.  Our audit work is carried out in
accordance with applicable law and International Standards on Auditing
(UK).

Auditing and accounting standards require us to evaluate the
appropriateness of balances and disclosures in the Scottish Government’s
consolidated accounts 2019/20, with a financial year end of 31 March
2020.  On the 11 December 2020, the consolidated accounts were authorised
for issue and the independent auditor’s report was certified.  All
material events between the 31 March and 11 December are required to be
considered and appropriately disclosed in the consolidated accounts to
ensure that they provide a true and fair view and are free from material
misstatements. 

The FReM requires bodies, including the Scottish Government, to account
for financial instruments (such as commercial loans) in accordance with
International Accounting Standards (IAS) 39 Financial instruments:
recognition and measurement, IAS 32 Financial instruments: presentation
and IFRS 7 Financial instruments: disclosures.

·         Burntisland Fabrications Limited

Gross value of loans drawn down by BiFab was £37.4 million of the £41
million loan facility. This was subsequently converted to equity by the
Scottish Government representing a total equity stake of 32 per cent.  In
the 2019/20 Consolidated Accounts, the Scottish Government’s stake was
valued at nil to reflect expected losses in line with accounting
requirements (IFRS 9).  We agreed with this impairment as it is consistent
with the company’s financial position.

During 2019/20, BiFab drew down £9 million of the £10 million loan
facility made available to support business restructuring and subsequently
wrote off this loan after 31 March. The write off is disclosed in the
2019/20 Consolidated Accounts.  There is £1.4 million of accrued interest
on the £9 million loan at 31 March 2020.

·         Ferguson Marine Engineering Limited (in administration)

Gross value of loans drawn down by FMEL was £45 million as at 31 March
2020, valued at nil at 31 March 2020.

·         Ferguson Marine Engineering (Holdings) Limited (in
administration)

We do not hold this information.

·         Ferguson Marine (Port Glasgow) Limited and associated companies

We do not hold this information.

·         Glasgow Prestwick Airport Limited and associated companies

Gross value of loans drawn down by Prestwick airport of £43.4 million as
at 31 March 2020. Loans valued at £10 million at 31 March 2020.

·         Lochaber Aluminium Smelter

We do not hold this information. Our audit work covered the financial
guarantee for Lochaber Aluminium Smelter.

·         Our Power Community Benefit Society Limited (in administration)

We do not hold this information.

Please also provide a list of loans and investments in commercial
organisations not otherwise listed above where the gross loan or
investment is £10 million or above at the end of March 2020. Please also
provide the net valuation of the loan or investment.

We do not hold this information.

Yours sincerely

Ian Metcalfe

Corporate Performance Officer

Audit Scotland, 4th Floor, 102 West Port, Edinburgh EH3 9DN

T: 0131 625 1861

[mobile number]

E: [2][email address]

[3]www.audit-scotland.gov.uk

During the current COVID-19 suppression measures I am working from home.
For more information on Audit Scotland’s work during this situation, read
the statement on our website. [4]https://www.audit-scotland.gov.uk/

[5][IMG]

Right of review and appeal

If you are dissatisfied with how we have handled your information request
or would like us to reconsider the decision we made, please write to:
Diane McGiffen, Chief Operating Officer, at 102 West Port, Edinburgh, EH3
9DN. You should do this as soon as possible and within 40 working days of
the date of issue of our response to your request.

If, after that, you are still not satisfied you can ask the Scottish
Information Commissioner to review how we dealt with your request. This
should be done within 6 months after the date of receipt of our response
to your review. The Commissioner is independent of Audit Scotland and can
decide whether we acted properly and according to the Freedom of
Information (Scotland) Act 2002.

The Information Commissioner can be contacted at: The Scottish Information
Commissioner, Kinburn Castle, Doubledykes Road, St Andrews, Fife, KY16
9DS, Tel 01334 464 610, email [6][email address]

References

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