External auditors blamed for delays to local government accounts

“Auditors scrutinising local authority accounts and the body responsible for appointing them have come under fire after new figures showed 40% of audit opinions missed the target date of 31 July.

Public Sector Audit Appointments (PSAA), the body responsible for appointing auditors, this week revealed that 210 out of 486 audit opinions on local government bodies for 2018/19 were not delivered on time.

The figure has jumped sharply from last year, when only 13% of opinions missed the deadline.

Graham Liddell, managing director at financial reporting consultancy LPFG and former senior technical manager at the Audit Commission, said: “This is a failure of the audit firms and of PSAA who appointed them.

“Of course, local authorities can make improvements, but by and large local authorities delivered the accounts, and by and large auditors failed to audit them.

“All the audit firms have enough staff to deliver their portfolio of local authority audits, it is just that they have chosen to maintain their margins and prioritise other sectors.

“I have immense sympathy for public sector audit teams who have been a handed an impossible job by their employers, but none for the firms themselves.”

He said that PSAA has presided over a process which has seen audit fees driven down to unsustainable levels.

“The big question is what does it do next? For a start, PSAA needs to stop defending auditors and blaming local authorities.

“It then needs to think carefully about audit fee rebates and how loudly it is going to name and shame the culprits.”

In a statement, the PSAA said a number of factors had driven the deterioration in performance, including, in some cases, a shortage of appropriately skilled and experienced auditors.

It said that, in other cases, the standard and timeliness of draft accounts, or working papers, has been lacking.

Other delayed opinions arose from difficulties in obtaining responses to and resolving audit queries, and unresolved technical issues including matters arising within group accounts, it said. …”

Auditors and PSAA slammed after jump in accounts deadline failures

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