Frequently Asked Questions – Page 2

Does the appointing person take on all auditor panel roles and therefore mitigate the need for there to be one in each individual authority?

Opting in to the appointing person scheme removes the need for a body to set up an independent auditor panel. The detailed requirements for this are set out in the Local Audit and Accountability Act 2014 and the Local Audit (Appointing Person) Regulations 2015.

Does the unnecessary complexity of local government accounts prevent smaller firms entering the marketplace and make audits unnecessarily long?

MHCLG has recognised this issue in the Spring statement and elsewhere.

Extending the deadlines beyond September is not the answer

We appreciate the disruption that result from delayed audits, as summarised by the NAO in its report in March 2021 on the timeliness of local government audit reporting. We also recognise that the impact on bodies with small finance teams can be more intense. However, regardless of the statutory position or the contractual requirements, a […]

Given we are operating in a broken market, should we go for a shorter contract? 5 years at 80-20 seems like a blank cheque for too long a period.

Our view is that a key part of fixing the market is to go for a long contract as this gives the firms some certainty and acknowledges the investment they have to make in this specialist area. We certainly do not think that the 80-20 weighting is a blank cheque, as although audit quality is […]

Have you considered the minimum fee approach as not just a monetary figure but setting a maximum percentage change from the existing fee structure?

We are currently researching the potential to introduce a minimum fee for some audits. This includes the possible impact on those bodies which had a current scale fee below any new minimum fee structure. We are engaging with all funding bodies regarding the fee procurement so that they are aware of our minimum fee proposals. […]

How are audit fee levels set for each individual body?

PSAA follows the requirements of the Local Audit (Appointing Person) Regulations 2015. PSAA consults annually on the fee scale. Individual scale fees are published on this website each year once confirmed by the PSAA Board following consultation. We will continue to pool scheme costs and charge fees to audited bodies in accordance with our published […]

How can you assess the quality elements?

We will publish a summary of our approach to the quality assessment of tender responses once it has been agreed by the PSAA Board.

How do you measure quality?

Our current arrangements for measuring the quality of audit services are published. We will be reviewing the evaluation methodology that we used in the last procurement (that can be found here [weblink]). Please note that it is the FRC that assesses the quality of the firms’ audit work in line with its statutory responsibilities.

How does an eligible body become an opted-in body?

A decision to become an opted-in body must be taken in accordance with the Regulations that is by the members of an authority meeting as a whole, except where the authority is a corporation sole, such as a police and crime commissioner, in which case this decision can be taken by the holder of that […]

How does PSAA procure audit services contracts?

The procurement of audit services for opted-in bodies is a key component of the appointing person arrangements. For the appointing period 2018/19 to 2022/23, PSAA has published the outcome of its procurement in 2017 to establish contracts. We are currently developing our arrangements for the scheme for the five-year appointing period from 2023/24 to 2027/28. […]