Source · Select Committees · Housing, Communities and Local Government Committee
Recommendation 31
31
Acknowledged
Introduce new guidance for local authority auditors to proactively flag potential issues earlier
Recommendation
The Department should work with the organisation that prepares the Audit Code (which is currently the National Audit Office but will be the system leader) to introduce new guidance for the auditors of local authorities in order to encourage them to make more proactive use of their existing powers to flag potential issues earlier in the audit process, both to managers internal to the authority and publicly by issuing Public Interest Reports. The Department should assess the effect of the guidance 12 months after it has been introduced and share that assessment with us. (Paragraph 135) Financial Reporting and Audit in Local Authorities 39
Government Response Summary
The government agrees with the importance of auditors using their powers and will work with the NAO and FRC to consider the merits of introducing new guidance. However, it does not commit to introducing the guidance or assessing its effect.
Government Response
Acknowledged
HM Government
Acknowledged
The government agrees with the Committee as to the importance of auditors using their existing powers and this will continue to remain a high priority under the proposals to clear the backlog. In communications to the sector, we have consistently encouraged greater use of these powers to flag concerns in line with the requirements of the Code of Audit Practice and existing guidance. We will work with the NAO and FRC to consider the merits of new guidance to further reinforce those expectations.