Independent review into council audits

Communities Secretary James Brokenshire has launched a review into the quality of local authority audits.

Assessing whether audits, in their current capacity, are spotting warning signs early enough, the government says that the work, to be led by former local authority treasurer Sir Tony Redmond, will examine the effectiveness of local authority financial reporting and audit regime.

In England, local authorities are responsible for 22 per cent of public sector expenditure, making the way councils report their accounts of high importance, with transparency and quality highlighted as key factors. The review will examine if auditors are using their powers appropriately and if councils are heeding recommendations to help improve the financial management of their accounts.

Speaking at the annual conference of the Chartered Institute of Public Finance and Accountancy, Brokenshire said: "A robust local audit system is absolutely pivotal to work on oversight, not just because it reinforces confidence in financial reporting but also service delivery and, ultimately, our faith in local democracy.

"There are potentially far-reaching consequences when audits aren’t carried out properly and they fail to detect significant problems. I am delighted Sir Tony Redmond will be leading this work and I await his report towards the end of this year."