Background to the report

Local government audit provides transparency and accountability to both taxpayers and their local elected representatives. It provides authorities with accurate and reliable financial information with which to plan and manage their services, and finances, effectively. It also provides assurance to the wider public sector, supporting the audit of certain central government departments and the Whole of Government Accounts.

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The arrangements for local audit in England changed significantly following the abolition of the Audit Commission in 2015. From 2018-19, local government bodies appointed private firms to undertake their audits, either directly or through a national scheme. Other responsibilities for regulation and standard setting were spread across multiple organisations. The Department for Levelling Up, Housing & Communities (DLUHC) also sought to compress the timetable for accounts production and audit from 2017-18, to increase public interest in local accounts and encourage more rigorous in-year monitoring.

Since 2017-18 there has been a significant decline in the number of local government body accounts including an audit opinion published by the deadlines set by government. We first reported on this in 2021, when 45% of accounts for 2019-20 were published by the deadline, down from 97% in 2015-16. This report provides an update on developments.

Scope of the report

This report provides a factual update on local auditor reporting since our March 2021 report. We set out:

  • An up-to-date position on the timeliness of audit opinions issued on local government bodies in England (local authorities, local police bodies, local fire bodies) and other bodies (combined authorities, functional bodies, local transport, national parks authorities, pensions authorities and waste disposal authorities)
  • An assessment of the impact of delays to local government audit opinions
  • the steps government and others have taken to address concerns reflected in PAC’s 2021 and 2022 recommendations. These concerns covered the need to: support the local audit market; increase the supply of qualified auditors; and reform the local audit system


Delays to local government audit opinions continue to have impacts elsewhere in the public audit system. In turn, delays in one sector disrupt audit firms’ planning and delivery for the other sectors. Issues include:

  • Delays to the certification of central government accounts that have material pensions valuations. The Ministry of Justice (MOJ) and the Department for Digital, Culture, Media & Sport (DCMS) both have a number of agencies or arm’s-length bodies with material Local Government Pension Scheme liabilities. The National Audit Office (NAO) requires local auditor assurances over these liabilities in order to certify these organisations’ accounts and the departmental accounts they feed into. Delays to these local auditor assurances contributed to MOJ and DCMS accounts for 2021-22 being certified between four and five months after the Parliamentary summer recess
  • Delays in publication and risks of reduced quality for the Whole of Government Accounts. Local audit delays were one of several factors affecting the 2019-20 Whole of Government Accounts, which were certified 26 months after the year end and five months later than the statutory deadline. PAC reported in 2022 how local government data that were unaudited or missing, due to local audit delays, risk adversely affecting the quality of the accounts and any insights based on them
  • Adverse impacts on NHS bodies which rely on the same audit market as local government bodies. NHS bodies have reported growing concerns about the capacity of their external auditors, resulting in the auditors carrying out fewer interim audits, which puts pressure on the audit of final accounts. They also report concerns around the attractiveness of the market to audit providers and the capacity of NHS finance staff to meet accounts preparation timetables


Publication details

Press release

View press release (25 Jan 2023)

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