16th Report - Whole of Government Accounts 2022-23

We also expressed concern as to whether MHCLG has the tools necessary to ensure local authorities produce audited accounts in future in line with the various backstop deadlines. MHCLG replied that, though backstop requirements are statutory, in the event a … Read more We also expressed concern as to whether MHCLG has the tools necessary to ensure local authorities produce audited accounts in future in line with the various backstop deadlines. MHCLG replied that, though backstop requirements are statutory, in the event a local authority does not meet that statutory requirement, it would first engage with a given local authority, and then publish a list of those that fail to publish accounts in time. It insisted that MHCLG does have intervention powers and has shown it is prepared to use them.43 However, in MHCLG’s view, there may be reasonable explanations for why local authorities cannot produce audited accounts in time, so did not think it reasonable to intervene in every instance of a body missing a backstop.44 We accept this explanation but we would expect MHCLG to always ask for an explanation as to why each account is late so that every local authority knows that they are being carefully scrutinised. 43 Q 21 44 Q 21 14 2 Useability and focus of the WGA Accessibility to readers Show less

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The Treasury told us that it was providing £45 million of funding to MHCLG to support local authorities in purchasing audit services. It confirmed that such funding was to address where audit costs have risen faster than fees paid.27 We challenged the Treasury and MHCLG about whether it would need …

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The Treasury and MHCLG also described other measures that they think will resolve the local authority audit issues. Beyond the backstop and additional funding, MHCLG said it is working to simplify the financial reporting requirements for local authorities, as the current level of complexity is, in MHCLG’s view, a barrier …

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