Source · Select Committees · Public Accounts Committee
Recommendation 1
1
Accepted
Government progress on improving timeliness of local government audit opinions reviewed.
Conclusion
On the basis of a report by the Comptroller and Auditor General (C&AG) we took evidence from the Department for Levelling Up, Housing and Communities (the Department), the Financial Reporting Council (FRC), and Public Sector Audit Appointments Ltd (PSAA) about progress government has made improving the timeliness of audit opinions issued on local government bodies in England.1 We also received written evidence from a number of individuals and organisations.
Government Response Summary
The government agrees, stating the Minister has outlined work by DLUHC and FRC to clear the audit backlog. The NAO and department are proposing final deadlines for auditors and local bodies to complete outstanding audits, with implementation anticipated by year-end, measuring progress by audits completed.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. (Minister for local government and building safety) also wrote to the Levelling-Up, Housing and Communities Committee outlining work being led by the Department of Levelling up Housing and Communities (DLUHC (the department)) and the Financial Reporting Council (FRC) to clear the backlog of delayed audits, including commitments from organisations across the local audit system, of which more detail can be found in the letter to the Committee accompanying this Treasury Minute. In order to prioritise the production of reliable and up-to-date financial information as quickly as possible, the NAO and the department are proposing to set a series of final deadlines for auditors and local bodies to clear the backlog of delayed audits. Auditors will be required to provide as much assurance as possible for these outstanding years and where necessary, limit their opinion to areas in which they have managed to carry out work. Auditors will still be required to report on value for money, while use of their statutory powers will remain paramount, ensuring residents can remain assured about council expenditure. These proposals have the support of the Local Audit Liaison Committee, who will continue to advise on implementation, which the department anticipates should be in train by year end, following a period of engagement over the summer. This builds on work the government has committed to in its response to the Redmond Review and its December 2021 package of measures to improve local audit delays. DLUHC and FRC will measure progress through monitoring the number of audits completed by the new deadlines.