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Meeting Notes - Horizon Integrity
Location: Coton House, Rugby
Date: 06.12.05
Those Present:
Keith Baines Fujitsu Contract Manager
Marie Cockett Project Manager, Finance
Mike Gallagher Systems Architect
Dave Hulbert Service Manager, Ops Control
John Legg Agency Contracts Manager
Jennifer Robson Debt Recovery Manager
Mandy Talbot Litigation Team Leader, Legal
Services
Graham Ward Investigation Team Casework
Manager
Alvin West Risk & Internal Control Manager
Flip Charts from the Meeting
“Flip Charts from 6
December.doc"
Findings.
1. There is no generally understood process for identifying
emerging cases in which the integrity of accounting
information produced by Horizon may become an issue.
2. There are a number of channels by which such cases may
enter Post Office (see flipchart list) and there is no process
for making information about them available to all relevant
functions. This increases the risk that different parts of the
business may be dealing with the same issue and not co-
ordinate responses.
3. The transaction logs that can be obtained from Fujitsu via
audit query requests provide the data that is required for the
investigation of claimed anomalies in particular cases.
However, interpretation of this data is not simple. It requires a
considerable level of understanding of branch transaction and
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accounting processes and how these are implemented on
Horizon, as well as the skills to analyse such data using PC-
based tools.
4. Fujitsu's price for providing the data and for skilled resource
to analyse and report on it is high, and the capacity provided
in the contract currently is fully used to support investigations
relating to potential criminal cases.
5. To date, the number of cases in which the integrity of Horizon
data has been an issue is small; however, recent
correspondence in The Subpostmaster may well cause an
increase; also there may also be an effect from the
introduction of transaction corrections, replacing error notices.
6. The NFSP has had no involvement in cases to date, and this
is expected to continue unless there was considerable
momentum for a change of policy from their membership.
7. Challenges to Horizon data integrity may arise late in the
process; for example following a suspension or issue of a late
account (to recover monies from a former subpostmaster).
8. If all potential cases were to require Horizon data to be
analysed early in the process, then the workload would be
considerable — and much would later prove unnecessary;
Currently there are around 12 suspensions per week, and a
significant proportion of them will relate to financial
discrepancies. Most of these are subsequently settled by
agreement, or are not contested.
9. Where a case does go to court, it is essential that Post Office
is able to refute any suggestion that Horizon is unreliable (in
general) or that it could have caused specific losses to the
subpostmaster bringing the case. The evidence needed for
these 2 points will be different.
10. For the general point, evidence will need to be in the
form of a credible expert opinion that confirms that the system
has been designed, built and operated in accordance with
good practice and that its overall performance provides
confidence that it is operating as intended.
11. On the specific errors claimed to have been caused in a
particular case, evidence will need to show (by reporting a
detailed analysis of the transactions, and other system log
entries recorded at the branch) that the system recorded
transactions and calculated accounts accurately; and that the
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transaction data is an accurate record of what was recorded
in the branch at the time transactions took place.
12. Because some discrepancies may arise in the wider
end to end process — for example, transaction discrepancies
based on client settlement data — the evidence may need to
cover a wider scope than just Horizon.
13. Such evidence will be given greater weight by a court if
it is provided by an expert who is distanced from Post Office
and Fujitsu. Evidence will need to be given by the person who
carried out the analysis — this may mean that in some
circumstances an independent expert would need to repeat
analysis for himself that Post Office or Fujitsu had already
carried out.
14. The Castleton (Marine Drive branch) case, scheduled
for 7 February is the first of the current cases that may require
expert testimony; this will not be needed on 7 February, but
could be needed the next time this case is in court; internal
analysis of the data by POL and Fujitsu will be required
before 7 February to confirm that POL’s position is valid.
Recommendations
1. Aco-ordination role should be established to maintain a
list of all current civil cases and potential civil cases where
accuracy of Horizon accounting information may be an
issue, and ensure that all relevant business functions are
made aware of these cases.
2. _ Briefing is required — primarily for the contracts and
services managers, but for all staff dealing with
subpostmasters — setting out business policy, lines to take,
and how to identify potential emerging cases.
3. Data available from Fujitsu is adequate for the analysis
required in these potential cases — though costly to obtain.
However, the capability to analyse and interpret such data
is not available in POL. The workload would not be
predictable, and when cases arise, will need to take
priority over other work. If the capability is provided in-
house more than one individual would be needed to
ensure adequate cover. Additional cost will be required
whether this is resourced internally or externally; and in
either case training would be needed to provide individuals
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with the full skills and knowledge required. On balance it
would probably be best to provide this resource in-house
but it would not be a self-contained full time role because
of the variable and unpredictable workload.
Appointing an external expert is likely to give the best
results in court. The expert will need to be able to testify
both on the overall status of Horizon and related systems
and on the analysis of data relating to individual cases.
Such an expert may be needed for the Castleton (Marine
Drive) case after February 7". Therefore discussions with
Fujitsu should be initiated on the role, ToR and access to
Fujitsu staff and information for such an expert Advice
should be obtained from Peter Corbett on the desirability
of using our external auditors to provide such an expert,
even though such a person may be seen as less
independent by a court.
There are some issues relating to the BIMS process. Post
Office staff dealing with the BIMS reports from Fujitsu are
sometimes unclear what action is appropriate in response
to the report, and no contact details are provided for
clarification to be obtained. These reports can result in
transaction corrections being issued and this may be
challenged by the subpostmaster.
Specific Actions
1.
JR / MC — to look at internal POL issues on handling of
BIMS reports from Fujitsu and brief DH on issues that
need to be raised with Fujitsu.
DH — to investigate BIMS process with Fujitsu and identify
any additional information or process improvements that
POL needs.
KB — to prepare and circulate to meeting attendees a first
draft of a Business Policy document (targeted at the
Service line) on Horizon including guidance on what
should be said to subpostmasters raising concerns (and
why). This should also provide guidance on how to
recognise potential cases.
DH - to propose a process for co-ordinating business
response to potential cases.
KB — to discuss the need for and ToR of an external expert
with Fujitsu.
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KB — to brief Dave Smith on the meeting’s
recommendations.
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