The Home Office has been commended by MPs for improvements in financial management.

The public accounts committee said the department had made big improvements since the highly critical capability review of 2006 – the same year in which then-home secretary John Reid described it as “not fit for purpose”.

MPs said officials had responded well to criticism in recent years by recruiting more trained accountants and pointed out that the splitting of Home Office responsibility with the Ministry of Justice had also helped improve performance.

There was praise for the department’s decision to boost accountability for money given to arms-length bodies, including the strengthened role of HM Inspectorate of Constabulary in monitoring value for money among police forces.

But the committee called for the department to place an even greater priority on financial training among staff, particularly given the anticipated period of spending cuts ahead.

Committee chair Edward Leigh said the department’s financial management had been in “disarray”, but improved to the extent that the cabinet secretary now pointed to the Home Office as an “exemplar”.

"This does not mean that sound financial management has now been established at all levels throughout the Home Office and in all its business activities,” he added.

“That must be the overriding objective. But there has been great improvement and things are going in the right direction. The department must build on the momentum it has achieved.”