The mechanism for allocating the costs of individual firm bids is the scale fee, which allocates the total costs of all firms’ tenders and PSAA total costs (approximately 2%) in a proportionate way across all bodies.
The scale fee does not vary in relation to which firm is appointed as auditor. Contingencies are not built into the fees and where additional audit work is required after the scale fee has been set, this results in a fee variation in line with the statutory framework. These may result in a permanent adjustment to the scale fee (for example group accounts are now required) or maybe for a single year only (for example a change of a key financial system). The scale fee is linked to the relative risk and cost of a particular body’s audit.