Audits and auditors—England
Produced in partnership with Stephen Sheen
Audits and auditors—England

The following Local Government practice note produced in partnership with Stephen Sheen provides comprehensive and up to date legal information covering:

  • Audits and auditors—England
  • External audits
  • The appointment of external auditors
  • Conduct of local audit
  • Audit outputs
  • Action by the auditor
  • The rights of the public
  • Audit costs
  • Grants and returns
  • Audit quality
  • More...

Local authority external audits in England are unique in the way they operate. They are more legalistic than the audits of companies and they extend beyond the focus on the annual accounts that is typical of the private sector audit. This Practice Note highlights key features of external audit and internal audit in England. The audit approach in Wales and Scotland is similar but the legal framework and detailed arrangements differ.

For the 2019/20 financial year, local government external audit operates fully under the framework of the Local Audit and Accountability Act 2014 (LAAA 2014). The LAAA 2014 provided for the closure of the Audit Commission on 31 March 2015, with its functions transferring to a number of bodies:

  1. Public Sector Audit Appointments (PSAA)—a limited company owned by the Local Government Association (LGA) and established to manage the audit contracts awarded by the Commission before its closure. These contracts expired after the 2017/18 financial year and auditors were appointed under contracts awarded either by PSAA or individual authorities under the LAAA 2014 framework

  2. National Audit Office (NAO)—maintaining the Code of Audit Practice and providing guidance to which auditors must have regard

  3. Cabinet Office—responsibility for the National Fraud Initiative and counter-fraud (working together with CIPFA)

  4. Financial Reporting Council—recognising and supervising recognised supervisory bodies

  5. recognised supervisory bodies—responsible for registering audit firms and regulating their activity

  6. appointing persons—appointing

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