Auditor appointment process from 1 April 2018

Appointments for all bodies that had opted into PSAA’s national appointing person scheme before 31 December 2017 were confirmed, following consultation, in December 2017.

From time to time it is necessary to make additional appointments, for example where a newly created body opts in. The process that applies for these appointments is explained below.

Developing proposals

For each body that opts in, we consider the most appropriate firm to appoint as the auditor, having regard to the following six principles approved by the PSAA Board:

  1. ensuring auditor independence;
  2. meeting our contractual commitments;
  3. accommodating joint/shared working arrangements where possible;
  4. ensuring a blend of authority types for each audit firm;
  5. taking account of a firm’s principal locations; and
  6. providing continuity of audit firm, if possible.

The primary consideration in allocating proposed appointments to individual opted-in bodies is to ensure independence, and then to balance the remaining principles.

PSAA is committed to ensuring good quality audits for opted-in bodies and has comprehensive contract management arrangements in place to secure a high level of audit quality for opted-in bodies. In making and reviewing auditor appointments to opted-in bodies, we take account of the results of this monitoring. Audit quality reports are published on the audit quality pages of this website.

Consulting on the proposed auditor appointment

We consult the opted-in body on the firm we propose to appoint as their auditor. Where a body accepts the appointment we propose, no further action is needed. We will confirm the appointment formally once it has been approved by the PSAA Board.

We recognise that in some instances there could be valid reasons why the proposed firm may not be appointed. Opted-in bodies therefore have the opportunity to make representations about the firm we have proposed, setting out the reasons formally in response to PSAA. The following may represent acceptable reasons:

  1. there is an independence issue, of which PSAA had not been informed;
  2. there are formal and relevant joint working arrangements, of which PSAA had not been informed; or
  3. there is another valid reason, for example a body can demonstrate a history of inadequate service from a particular firm.

Representations are considered carefully and PSAA makes a formal response in every case, whether accepted or rejected. Where representations are accepted, we consult on a revised appointment proposal.

Finalising and confirming appointments

The PSAA Board approves all proposed appointments, following consultation with audited bodies. The Board’s decision on the appointment of an auditor is final.