BOARD – SUMMARY REPORT
Date of Board meeting:
8th June 2010
Title of Report:
Letter of Representation
Title of Director:
Director of Finance & Information
Paper Number:
WL1855
Purpose of the report:
The report presents the Letter of Representation to the Board.
Recommendations to the Board:
To APPROVE the Letter of Representation.
Action required:
The Letter of Representation is signed by the Chief Executive and the Chairman. This letter is
required by the external auditors prior to the Appointed auditor signing the Accounts with an
unqualified opinion and forwards to the DH before the deadline of 11th June (9am)
Relationship with the Assurance Framework (Risks, Controls, and Assurance):
CO1: To provide a safe and effective service
CO3: To become a provider of choice
CO5: To build an engaged and patient focused workforce
Healthcare Standards (Core/Developments):
Regulation 10: Assessing and monitoring the quality of service provision.
Summary of Financial and Legal Implications:
The letter of representation is a key document in the Annual Accounts process and it
provides assurance to PWC on matters in the annual accounts 2009/10.
Equality & Diversity and Public & Patient Involvement Implications:
None
WEST LONDON MENTAL HEALTH NHS TRUST
TRUST LETTER OF REPRESENTATION
FROM THE DIRECTOR OF FINANCE AND INFORMATION
The Board is asked to APPROVE the Letter of Representation
1. Introduction
The purpose of this paper is to present the Letter of Representation of the Trust to the Board for
approval.
2. Letter of Representation
The letter of representation provides assurance to PWC, our external auditors on matters
within the annual accounts 2009/10.
The letter includes a list of the differences found during the audit process that have not
been adjusted in the final version of the accounts due to the fact that they are not
considered to be material by the Trust as agreed with the external auditors.
This list of adjustments also forms part of the Audit Memorandum Report to those
Charged with Governance (Item 6 on the agenda) and were subject to review by the
audit committee on Thursday 3rd June.
3. Conclusion
The letter of representation is required in order for our external auditors to sign our
Annual Accounts in line with the Department of Health deadline of 11th June.
The Board is asked to APPROVE the Letter of Representation.
Barbara Byrne
Director of Finance and Information
June 2010
PricewaterhouseCoop
ers LLP
8th June 2010
80 Strand
London
WC2R 0AF
This representation letter is provided in connection with your audit of the financial statements
of West London Mental Health NHS Trust (“the Trust”) for the period ended 31 March 2010.
Your audit is conducted for the purpose of expressing an opinion as to whether the financial
statements of the Trust give a true and fair view, in accordance with International Financial
Reporting Standards (IFRSs) as adopted by the European Union and interpreted by the
Department of Health Manual for Accounts, of the gains and losses, cash flows and financial
state at the end of the financial period ended 31 March 2010 in accordance with the direction
of the Secretary of State.
We acknowledge as directors our responsibilities under the National Health Service Act
2006 for preparing financial statements of the Trust which give a true and fair view, in
accordance with IFRSs, and for making accurate representations to you.
We acknowledge that the Chief Executive has been designated as the Accountable Officer
for the Trust by the Secretary of State and that the following requirements included in the
Accountable Officer Memorandum have been complied with:
“You have a particular responsibility for ensuring that expenditure by the Trust complies with
Parliamentary requirements. The basic principle which must be observed is that funds
should be applied only to the extent and for the purpose authorised by Parliament…”
“As the Accountable Officer you have a responsibility to see that appropriate advice is
tendered to the Board on all matters of financial probity and regularity…”
“If the Board or the Chairman is contemplating a course of action which you consider would
infringe the requirements of propriety and regularity, you should set out in writing to the
Chairman and the Board your objection to the proposal and the reasons for it.”
We confirm that the following representations are made on the basis of enquiries of
management and staff of the Trust with relevant knowledge and experience and, where
appropriate, of inspection of supporting documentation sufficient to satisfy ourselves that we
can properly make each of the following representations to you.
We confirm, for all directors at the time the directors’ report is approved, to the best of our
knowledge and belief and having made the appropriate enquiries, the following
representations:
Accounting records
Each director has taken all the steps that he or she ought to have taken as a director in order
to make himself or herself aware of any relevant audit information and to establish that you
(the Trust's auditors) are aware of that information, including that:

All the accounting records, whether for the purposes of financial reporting or any
other purpose such as fiscal reporting, have been made available to you for the
purpose of your audit and all the transactions undertaken by the Trust have been
properly reflected and recorded in the accounting records.

All other records and related information which might affect the truth and fairness of,
or necessary disclosure in, the financial statements, including minutes of directors’
and relevant management meetings, have been made available to you and no such
information has been withheld.
So far as each director is aware, there is no relevant audit information of which you are
unaware.
Accounting policies
We confirm that we have reviewed the Trust’s accounting policies and estimation techniques
and, having regard to the possible alternative policies and techniques, the accounting
policies and estimation techniques selected for use in the preparation of the financial
statements are the most appropriate to give a true and fair view for the Trust’s particular
circumstances, as directed by the Secretary of State.
Related parties
We confirm that we have disclosed all related party transactions relevant to the Trust and
that we are not aware of any other such matters required to be disclosed in the financial
statements whether under IAS 24 or other requirements, for example, the Manual for
Accounts.
Employee benefits
We confirm that we have made you aware of all employee benefit schemes in which
employees of the Trust participate.
Contractual arrangements/agreements
All contractual arrangements (including side-letters to agreements) entered into by the Trust
with third parties have been properly reflected in the accounting records or, where material
(or potentially material) to the financial statements, have been disclosed to you.
The Trust has complied with all aspects of contractual agreements that could have a
material effect on the financial statements in the event of non-compliance. There has been
no non-compliance with requirements of regulatory authorities that could have a material
effect on the financial statements in the event of non-compliance.
We have disclosed all material agreements that have been undertaken by the Trust in
carrying on its business.
Laws and regulations
We are not aware of any instances of actual or potential breaches of, or non-compliance
with, laws and regulations which provide a legal framework within which the Trust conducts
its business and which are central to the Trust’s ability to conduct its business or that could
have a material effect on the financial statements.
We are not aware of any irregularities, or allegations of irregularities, involving management
or employees who have a significant role in the accounting and internal control systems, or
that could have a material effect on the financial statements.
Fraud
We acknowledge our responsibility for the design and implementation of internal control to
prevent and detect fraud.
We have disclosed to you:
i)
the results of our assessment of the risk that the financial statements may be
materially misstated as a result of fraud
ii) our knowledge of fraud or suspected fraud affecting the Trust and involving:
 Management
 Employees who have significant roles in internal control, or
 Others where the fraud could have a material effect on the financial statements;
iii) our knowledge of any allegations of fraud, or suspected fraud, affecting the Trust’s
financial statements communicated by employees, former employees, analysts,
regulators or others.
Assets and liabilities
We have no plans or intentions that may materially alter the carrying value or classification of
assets and liabilities reflected in the financial statements.
In our opinion, on realisation in the ordinary course of the business of the Trust the current
assets in the balance sheet are expected to produce no less than the net book amounts at
which they are stated.
The Trust has satisfactory title to all assets and there are no liens or encumbrances on the
Trust's assets.
We confirm that we have carried out impairment reviews appropriately, including an
assessment of when such reviews are required, where they are not mandatory. We confirm
that we have used the appropriate assumptions with those reviews.
Provisions
Full provision has been made for all liabilities at the balance sheet date including
guarantees, commitments and contingencies where the items are expected to result in
significant loss Other such items, where in our opinion provision is unnecessary have been
appropriately disclosed in the financial statements. We confirm we believe all provisions for
liabilities and charges held in the balance sheet as at 31 March 2010 meet the requirements
of IAS 37.
Income and expenditure
We confirm that we have recognised all income receivable in 2009/10 in the income and
expenditure account except where this income relates to specific activity to be delivered in
future years.
We confirm the Trust has prepared the financial statements on the accruals basis for
both income and expenditure.
Misstatements detected during the audit
We acknowledge our responsibility for the design and implementation of internal control to
prevent and detect error.
We confirm that the financial statements are free from material misstatement, including
omissions.
We confirm that the reasons why the misstatements that you have brought to our attention
below in the attachment to this letter have not been adjusted in the financial statements is
because the directors believe their effect both individually and in aggregate is not material to
the truth and fairness of the financial statements either taken as a whole or in connection
with the ability properly to assess the performance and/or the financial position of the Trust.
Taxation
We have complied with the taxation requirements of all countries within which we operate
and have brought to account all liabilities for taxation due to the relevant tax authorities
whether in respect of any corporation or other direct tax or any indirect taxes. We are not
aware of any non-compliance that would give rise to additional liabilities by way of penalty or
interest.
In particular:

In connection with any tax accounting requirements, we are satisfied that our
systems are capable of identifying all material tax liabilities and transactions subject
to tax and have maintained all documents and records required to be kept by the
relevant tax authorities in accordance with the law of each country or in accordance
with any agreement reached with such authorities.

We have submitted all returns and made all payments that were required to be made
(within the relevant time limits) to the relevant tax authorities including any return
requiring us to disclose any tax planning transactions that have been undertaken,
whether for the Trust’s benefit or any other party’s benefit.

We are not aware of any taxation, penalties or interest that are yet to be assessed
relating to either the NHS body or any associated company for whose taxation
liabilities the Trust may be responsible.
Subsequent events
There have been no circumstances or events subsequent to the period end which require
adjustment of or disclosure in the financial statements or in the notes thereto.
As minuted by the board of West London Mental Health NHS Trust at its meeting on 8th June
2010.
........................................
(Chairman)
For and on behalf of West London Mental Health NHS Trust.
Date ……………………
........................................
Chief Executive
ENCLOSURE B
Paper WL1855
Appendix – Summary of Unadjusted Misstatements
We have identified the following misstatements during our audit of the financial statements that
have not been adjusted by management.
Unadjusted
Misstatement
Statement of Comprehensive
Income
Dr
Cr
Statement of Financial Position
Dr
Cr
Adjustments which impact on the financial position
Depreciation
Testing of
depreciation revealed
negative depreciation
in respect of negative
additions (£5,000) and
also depreciation had
not been applied to
non-operational
assets (£201,000)
Expenditure
£206,000
Accumulated
depreciation
£206,000
Accruals – Revenue
Our work identified
two under accruals
relating to revenue
expenditure.
Expenditure
£53,000
Accruals
£53,000
Other operating
income
Testing of other
operating income
identified one item
which is being
disputed by the
customer and is not
deemed to be
recoverable.
Expenditure
£6,000
Provision for
impairment of
receivables
£6,000
ENCLOSURE B
Paper WL1855
Unadjusted
Misstatement
Statement of Comprehensive
Income
Dr
Cr
Statement of Financial Position
Dr
Cr
Provisions
£2,000
Patient monies
control account
£7,000
Adjustments which impact on the financial position
Patient’s monies –
Ealing
It was noted that total
assets held for Ealing
patient monies did not
fully net off against
the liabilities held.
Expenditure
£5,000
Provisions
There was a
difference noted
between the
Capsticks provision
per the confirmation
provided and the
value of the legal
provision held in the
accounts.
Expenditure
£7,000
Capitalised costs
Our review of the
repairs and
maintenance
expenditure
highlighted three
items charged to
revenue that should
have been capitalised.
Expenditure
£19,000
Intra-NHS
receivables
One item tested was
found not to be an
NHS receivable as at
the year end.
Unadjusted
Misstatement
Provisions
£7,000
Additions
£19,000
Income
£9,000
NHS
receivables
£9,000
Statement of Comprehensive
Income
Dr
Cr
Statement of Financial Position
Dr
Cr
Property, plant
and equipment
£23,000
Accruals
£23,000
Classification adjustments
Accruals – Capital
Our work identified
one under accrual
relating to a capital
addition.
ENCLOSURE B
Paper WL1855