The CIPFA LASAAC Local Authority Code Board has announced an emergency consultation to explore proposals for change to the 2021/22 Code of Practice on Local Authority Accounting in the United Kingdom and the 2022/23 code that might serve to improve current issues around timeliness of the publication of audited financial statements.
The consultation follows a request from the Department for Levelling Up, Housing and Communities (DLUHC) to consider time limited proposals. While CIPFA LASAAC does not see the code as a cause of the delays, the board is minded to explore ways the code might be part of a temporary solution.
Due to the urgency of the local audit situation, the consultation period will be open for four weeks, the minimum period allowed by its terms of reference. Any consequential changes to the 2021/22 code will need to be finalised by 31 March 2022.
After considering a wide range of options after DLUHC's request, CIPFA LASAAC decided to explore two specific options:
Rob Whiteman, CIPFA CEO said: "The timeliness of the publication of audited financial statements is a very real and growing issue in the sector. Only 9% met the 2020/21 deadline, amid significant backlogs from the previous year's audits. The outlook for the market is bleak.
"DLUHC is understandably concerned about this growing crisis – and CIPFA shares this concern. We're committed to supporting CIPFA LASAAC in its exploration of the options that may improve timeliness issues, without significantly impacting accountability. But this is a difficult issue, and we need feedback from stakeholders on whether and how this might work."
Conrad Hall, Chair of CIPFA LASAAC and Corporate Director of Resources London Borough of Newham commented: "I hope the sector gives this necessarily short consultation the serious attention it requires. The delays in 2020/21 do not reflect well on the overall system for local authority audit and accounts. All of us have a part to play in addressing that. Given the constrained timelines, we are also hoping to organise outreach activities to discuss the issues raised – and we welcome participation from the sector."
Notes to editor
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