No. The extent of rebuilding assurance work will depend on the circumstances of the individual body, including the nature of previous audit opinions, the availability of audit evidence, and the auditor’s assessment of risk.
The independence requirements for all auditors in the local public audit regime are the same, whether locally appointed or part of the appointing person regime. These requirements are specified by the Financial Reporting Council in the Ethical Standard and applied to local public audit as determined by the NAO.
The services that an auditor can provide are the same whether appointed by PSAA or through local arrangements.
As the Appointing Person, PSAA performs the role otherwise required of an Independent Auditor Panel to advise the body on ensuring the independence of the auditor (Local Audit and Accountability Act 2014 section 10(1)).
Yes. Where auditors undertake additional work to rebuild assurance, any associated costs will continue to be considered through PSAA’s fee variation process. Audit firms must submit evidence to support the work undertaken and PSAA will review the information before determining any fee variation.
Yes. The scale fee covers the expected recurring audit work based on the information available when fees are set. Fee variations may still be required where additional work is needed because of specific local circumstances, new issues arising during the audit, or where the actual audit work is substantially more or less than envisaged when the scale fee was determined. The impact of IFRS 16 (Leases) and ISA (UK) 600 (Group Audits) is not currently included because the level of additional audit work remains highly dependent on individual bodies’ circumstances. Work to rebuild assurance is also excluded from the scale fee and will continue to be considered through fee variation arrangements.
The proposed 2026/27 scale fee is based on PSAA’s current statutory responsibilities and the audit contracts in place. We will explain any material effect of the Local Audit Office or wider reforms on future fee arrangements when the Government confirms the relevant responsibilities and implementation timetable.
Across all audited bodies, the proposed average scale fee increase was 4%. Where there were no confirmed changes in the level of audit work required, the increase will be 2.8%. Any increase above 2.8% reflects a confirmed additional requirement, such as the inclusion of a new group in the audit scope. Taken together, these adjustments result in an overall average increase.
As part of the Scale fee setting process we reviewed all proposed increases and we wrote to all audited bodies with the proposed 2025/26 Scale Fee. Each letter included an explanation of any specific changes applicable to that organisation. Consultation letters were sent to the Section 151 officer or equivalent at each audited body. Amendments throughout this process resulted in an average increase of 3.08% (2.8% inflation plus 0.28% specific increases). We publish the final scale fees and consultation outcome on our website.