"Whilst recognising that no tax collection system can ensure that all those who have a tax liability comply with their obligations, the National Audit Office’s work in 2006-07 provided assurance that HM Revenue & Customs has framed adequate regulations and procedure to secure an effective check on the assessment, collection and proper allocation of revenue, and that they were being duly carried out. That assurance is subject to reservations  about the level of claimant error and fraud in the award of tax credits (see Part 2 of this report). The report also includes observations on the collection of income tax through PAYE and Self Assessment and the administration of Value Added Tax."

Full report at: http://www.nao.org.uk/publications/nao_reports/06-07/0607626.pdf

"Subject to reservations" sounds a bit like a qualified audit report to me.

I was also not suprised to see in the press today either that half of Government Department fraud (that's the parts they actually find so no doubt there is probably a lot more going on!) takes places at HMRC.  Many commentators seem to have the view that HMRC is a department a little wayward in both it's approach and execution of many of it's processes and activities. It is a department that could do with a bit more supervision and accountability. However when the Chairman of HMRC "resigns" after the department lost the biggest blunder in data protection in UK history but is then moved immediately to the Cabinet Office as a "punishment" it is hardly suprising that "supervision" is not effective.