1. At the Committee of Public Accounts' hearing on 20 January 2010 (Qq100-104), Mr Davidson asked the C&AG to provide a note to the Committee on:
- "the extent to which there was a benefit to the Government as a result of it (Mapeley) being offshore; and
- whether or not the company have played fair in terms of giving the price back."
Mapeley committed to providing the information necessary for the National Audit Office to complete this review.
2. We have assessed, with HM Revenue and Customs, how the tax savings arising from the offshore status of various Mapeley companies were reflected in Mapeley's financial model that underpins the contract and the prices paid by the Department. We also considered the likely tax savings obtained to 2009. In doing so we have examined accounts for the various companies involved and records provided by Mapeley. While Mapeley provided some information in February, most of the information was provided in mid-March. We are unable to be precise about the tax advantages obtained because of the complexity of the tax computations (which include the treatment of expenses, and offsetting losses in different periods, between trading income and capital gains, and between companies within the group). Nevertheless we have been able to reach broad conclusions on the two questions posed in paragraph 1 above.