Options to appoint an external auditor

There are three ways for a principal local government or police body to appoint its auditor for the five financial years from 2023/24, namely:

  • undertake an individual auditor procurement and appointment exercise;
  • undertake a joint audit procurement and appointing exercise with other bodies, those in the same locality for example; or
  • join PSAA’s sector led national scheme.

All of the above options require a local auditor to be appointed not later than 31 December in the financial year preceding the financial year of the accounts to be audited. For the audit of the accounts of the 2023/24 financial year, there must be a local auditor appointed by 31 December 2022.

There is a local auditor register maintained by the ICAEW which lists the audit firms that have been registered as local auditors and the key audit partners who have met the eligibility criteria.

Individual or joint procurement (options 1 and 2)

The legislation requires the establishment of an independent auditor panel. Guidance on auditor panels was issued by CIPFA in 2017 for local government bodies: CIPFA guidance on auditor panels.

PSAA’s national scheme (option 3)

We believe that the national scheme stands out as the best option for all eligible bodies, offering excellent value for money and assuring the independence of the auditor appointment.

The company is staffed by a team with significant experience of working within the context of the Regulations to appoint auditors, manage contracts with audit firms, and set and determine audit fees. All of these roles are undertaken with a detailed, ongoing, and up-to-date understanding of the distinctive context of a highly regulated service and profession which is subject to dynamic pressures for change.

We plan to run the scheme in a way that will save time and resources for local bodies – time and resources which can be deployed to address other pressing priorities.

By joining the scheme, bodies can:

  • avoid the necessity to establish an independent auditor panel (detailed requirements specified by the Local Audit & Accountability Act, 2014);
  • avoid the need to manage their own auditor procurement;
  • benefit from PSAA undertaking a robust process to validate fee variation proposals; and
  • assuming a high level of participation, be able to support market sustainability and encourage realistic prices in a challenging market.

If you have a specific enquiry about the appointment of auditors from 2023/24, please contact us at auditorappointments@psaa.co.uk.