If you can’t deliver improved timeliness of audits what are you going to do to help – it feels like the the auditors have all the control?

Issues with the timeliness of audit opinion delivery are caused by a variety of factors and PSAA shares your views and recognises your disappointment and frustration at the prospect of a future delayed audit process.

In December 2021, DLUHC published a new package of measures to support the improved timeliness of local audit. It sets out a range of measures agreed with key partners to support the timely completion of local government audits and the ongoing stability of the local audit market. These measures will help to ensure that audit provides transparency and accountability in local councils. The issuing of this guidance paper was featured as one of our ‘latest news items’.

In common with all stakeholders in the local audit system, we want to see the earliest possible return to a position in which virtually all local bodies are able to publish their audited accounts by the target date specified in the Accounts and Audit Regulations.

Unfortunately, there are a number of significant obstacles which need to be overcome before that goal can be realised. They include:

  • a backlog of delayed prior year audit opinions which are still outstanding;
  • a shortage of audit staff with the requisite skills and experience;
  • more demanding regulatory requirements which increase the time and resources needed to complete each audit;
  • local bodies entering more frequently into innovative transactions which require detailed examination by auditors, and capacity shortages in finance and other staff to deal with the volume and complexity of local government accounts; and
  • the challenges posed by the pandemic including its implications for auditors’ work in relation to the financial resilience of bodies.

None of these hurdles lend themselves to quick fixes. Unfortunately, there are no easy solutions which we or any other parties can simply action. The reality is that returning to a more predictable and stable position is going to take some time and will be a gradual process.

With respect to financial penalties the Ethical Standard precludes contracts that contain fees that vary according to a pre-determined measure (for example specifying a date by which an audit opinion must be given).